j2 Global, Inc. (NASDAQ:JCOM) Files An 8-K Entry into a Material Definitive Agreement

ITEM1.01

On June27, 2017, j2 Cloud Services, LLC (j2 Cloud), a
wholly-owned subsidiary of j2 Global, Inc., and j2 Cloud
Co-Obligor, Inc., a wholly-owned subsidiary of j2 Cloud (the
Co-Issuer and together with j2 Cloud, the Issuers) completed the
issuance and sale of $650million aggregate principal amount of
its 6.000% senior notes due 2025 (the Notes) in a private
placement to persons reasonably believed to be qualified
institutional buyers to Rule 144A under the Securities Act of
1933, as amended (the Act) and to certain non-U.S. persons in
transactions outside the United States in reliance on Regulation
S under the Act (the Senior Notes Offering). The Notes were sold
to a purchase agreement, dated June22, 2017 (the Purchase
Agreement), among the Issuers, certain of j2 Clouds direct and
indirect wholly-owned subsidiaries that are signatories to the
Purchase Agreement (collectively, the Guarantors) and Citigroup
Global Markets Inc., as representative of the several initial
purchasers (the Initial Purchasers).

j2 Cloud estimates that the net proceeds from the Senior Notes
Offering are approximately $636.4million, after deducting the
Initial Purchasers discounts and commissions and the Issuers
estimated offering expenses. The Issuers intend to use the net
proceeds from the Senior Notes Offering to redeem all of j2
Clouds outstanding 8.000% Senior Notes due 2020 (the 2020 Notes),
to distribute sufficient net proceeds to j2 Global, Inc. (j2
Global) to pay off all amounts outstanding under j2 Globals
existing credit facility (Credit Facility) and, to the extent any
proceeds remain thereafter, for general corporate purposes, which
may include acquisitions.

Indenture

The Notes are governed by an indenture dated as of June27, 2017
(the Indenture), between the Issuers, the Guarantors and U.S.
Bank National Association, as trustee. The Notes bear interest at
a rate of 6.000% per annum, payable semiannually in arrears in
cash on January15 and July15 of each year, commencing on
January15, 2018. The Notes mature on July15, 2025, and are senior
unsecured obligations of the Issuers and are guaranteed on an
unsecured basis by the Guarantors. If j2 Cloud or any of its
restricted subsidiaries acquires or creates a domestic restricted
subsidiary, other than an Insignificant Subsidiary (as defined in
the Indenture), after the issue date, or any Insignificant
Subsidiary ceases to fit within the definition of Insignificant
Subsidiary, such restricted subsidiary is required to
unconditionally guarantee, jointly and severally, on an unsecured
basis, the Issuers obligations under the Notes.

The Issuers may redeem some or all of the Notes at any time on or
after July15, 2020 at specified redemption prices plus accrued
and unpaid interest, if any, to, but excluding the redemption
date. Before July15, 2020, and following certain equity
offerings, the Issuers also may redeem up to 35% of the Notes at
a price equal to 106.000% of the principal amount, plus accrued
and unpaid interest, if any, to, but excluding the redemption
date. In addition, at any time prior to July15, 2020, the Issuers
may redeem some or all of the Notes at a price equal to 50% of
the principal amount, plus accrued and unpaid interest, if any,
to the redemption date, plus an applicable make-whole premium.

The Indenture contains covenants that will limit the Issuers
ability and, in certain instances, the ability of certain of the
j2 Clouds subsidiaries to (i)pay dividends or make distributions
on j2 Clouds capital stock or repurchase j2 Clouds capital stock;
(ii)make certain restricted payments; (iii)create liens or enter
into sale and leaseback transactions; (iv)enter into transactions
with affiliates; (v)merge or consolidate with another company;
and (vi)transfer and sell assets. These covenants include certain
exceptions.

A copy of the Indenture (including the Form of Note) is filed as
Exhibit 4.1 to this Current Report on Form 8-K and is
incorporated herein by reference. The description of the
Indenture in this report is only a summary and is qualified in
its entirety by the terms of the Indenture (including the Form of
Note).

8.000% Senior Notes Due 2020

On June27, 2017, j2 Cloud notified U.S. Bank National
Association, as trustee (the 2012 Trustee) under the indenture,
dated as of July26, 2012 (as amended, supplemented or otherwise
modified, the 2012 Indenture), between j2 Global and the 2012
Trustee, as supplemented by the First Supplemental Indenture,
dated as of June10, 2014, among j2 Cloud (formerly known as j2
Cloud Services, Inc.), j2 Global and the 2012 Trustee, governing
the 2020 Notes that j2 Cloud would redeem the 2020 Notes and
satisfy and discharge (the Satisfaction and Discharge) the 2012
Indenture using the net proceeds from the offering of the Notes.

On June27, 2017, the j2 Cloud deposited sufficient funds with the
2012 Trustee to fund the redemption of the outstanding aggregate
principal amount of the 2020 Notes, to pay the redemption premium
equal to 102% of the principal amount on the 2020 Notes and to
pay accrued and unpaid interest on the 2020 Notes to, but
excluding, the redemption date (the principal, premium and
interest collectively referred to herein as the Redemption
Price), which will be August1, 2017 (the Redemption Date). The
2012 Trustee has acknowledged that the Satisfaction and Discharge
of the 2012 Indenture was effective on June27, 2017. The
Redemption Price will be paid to holders of the 2020 Notes on the
Redemption Date.

Credit Agreement

On June27, 2017, net proceeds from the Senior Notes Offering were
used to, among other things, repay the Credit Agreement, dated as
of December5, 2016 (as amended, supplemented, waived or otherwise
modified from time to time), among j2 Global, as borrower, the
lenders party thereto, MUFG Union Bank, N.A., as administrative
agent and as joint lead arranger, and Citigroup Global Markets
Inc., as joint lead arranger.

The information set forth in Item 1.01 above is incorporated by
reference into this Item 2.03.

On June27, 2017, the j2 Global and j2 Cloud issued a joint press
release announcing the completion of its issuance and sale of the
Notes in a private placement. A copy of the press release is
attached as Exhibit 99.1 to this Form 8-K.

On June27, 2017, j2 Cloud delivered its Notice of Redemption for
all of the outstanding 2020 Notes to U.S. Bank National
Association, as trustee, and to the holders of the 2020 Notes.
The redemption of the 2020 Notes is expected to occur on the
Redemption Date.

(d) Exhibits

J2 GLOBAL, INC. Exhibit
EX-4.1 2 d404529dex41.htm EXHIBIT 4.1 Exhibit 4.1 Exhibit 4.1     EXECUTION VERSION     j2 CLOUD SERVICES,…
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