CDK Global, Inc. (NASDAQ:CDK) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 Entry into a Material Definitive Agreement.
On June 18, 2018, the Company closed its offering of the $500,000,000 in aggregate principal amount of 5.875% Senior Notes due 2026 (the “Notes”). The Notes were issued to an Indenture, dated as of June 18, 2018, between the Company and U.S. Bank National Association, as trustee, as supplemented by the Officer’s Certificate, dated as of June 18, 2018 (the “Indenture”). The net proceeds from the sale of the Notes will be used by the Company for general corporate purposes, which may include share repurchases, dividends, acquisitions, repayments of debt, and working capital and capital expenditures.
The Indenture provides, among other things, that the Notes will be senior unsecured obligations of the Company. Interest is payable on the Notes on June 15 and December 15 of each year, beginning December 15, 2018. The Notes will mature on June 15, 2026.
Prior to June 15, 2021, the Company may redeem the Notes in whole or in part at a price equal to 50% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, plus the applicable “make-whole” premium.
On or after June 15, 2021, the Company may redeem the Notes at a price equal to: (i)102.938% of the aggregate principal amount of the Notes redeemed prior to June 15, 2022; (ii)101.958% of the aggregate principal amount of the Notes redeemed on or after June 15, 2022 but prior to June 15, 2023; (iii)100.979% of the aggregate principal amount of the Notes redeemed on or after June 15, 2023 but prior to June 15, 2024; and (iv) 100.000% of the aggregate principal amount of the Notes redeemed thereafter.
Subject to certain limitations, in the event of a change of control of the Company, the Company will be required to make an offer to purchase the Notes at a purchase price equal to 101.000% of the principal amount of the Notes, plus accrued and unpaid interest to (but not including) the date of purchase.
As the general unsecured obligations of the Company, the Notes rank (i) equally in right of payment with all of the Company’s existing and future senior indebtedness, including indebtedness under the Company’s credit facilities and existing senior notes, (ii) senior to all of the Company’s future subordinated indebtedness, (iii) effectively subordinated to all of the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing such indebtedness and (iv) structurally subordinated to the obligations of the Company’s subsidiaries.
The Indenture contains covenants that limit the Company and its subsidiaries’ ability to, among other things: (i) incur liens on any of their properties or assets; (ii) enter into any sale/leaseback transaction; and (iii) consolidate with, merge with or into, or sell, convey, transfer or lease all or substantially all its assets to, any other person. These covenants are subject to a number of important exceptions and qualifications, as described in the Indenture. The Indenture also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all the then outstanding Notes to be due and payable immediately.
The foregoing description of the Notes and the Indenture are qualified in its entirety by reference to the full text of the Indenture, which is included as Exhibit 4.1 to this report, and the Officer’s Certificate, which is included as Exhibit 4.2 to this report, each of which is incorporated into this Current Report on Form 8-K.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Please see the discussion set forth under Item 1.01, “Entry into a Material Definitive Agreement,” of this Form 8-K, which discussion is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit | |
| Number | Description of Exhibit |
| 4.1 | Base Indenture, dated as of June 18, 2018, between CDK Global, Inc. and U.S. Bank National Association, as trustee |
| 4.2 | Officer’s Certificate, dated as of June 18, 2018 (including the form of the Company’s 5.875% Senior Notes due 2026) |
| 5.1 | Opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP |
| 23.1 | Consent of Paul, Weiss, Rifkind, Wharton & Garrison LLP (included in Exhibit 5.1 hereto) |
CDK Global, Inc. ExhibitEX-4.1 2 exh_41.htm EXHIBIT 4.1 Exhibit 4.1 CDK GLOBAL,…To view the full exhibit click here
About CDK Global, Inc. (NASDAQ:CDK)
CDK Global, Inc. provides integrated information technology and digital marketing solutions. The Company’s segments include Retail Solutions North America, Advertising North America and CDK International. Through its Retail Solutions North America segment, the Company provides technology-based solutions, including automotive Website platforms, that help automotive retailers, original equipment manufacturers (OEMs) and other industry participants manage the acquisition, sale, financing, insuring, parts supply, repair and maintenance of vehicles. Through its Advertising North America segment, the Company provides advertising solutions, including management of digital advertising spend, for OEMs and automotive retailers. As of June 30, 2016, through its CDK International segment, it provided technology-based solutions similar to the retail solutions provided in its Retail Solutions North America segment in approximately 100 countries outside of the United States and Canada.
