Park-Ohio Holdings Corp. (NASDAQ:PKOH) Files An 8-K Entry into a Material Definitive Agreement
Item1.01
| Entry into a Material Definitive Agreement. |
Indenture
On April17, 2017, Park-Ohio Industries, Inc. (the Company), an
Ohio corporation and a wholly owned subsidiary of Park-Ohio
Holdings Corp. (the Parent), and its material domestic
subsidiaries (the Guarantors) entered into an indenture (the
Indenture) with Wells Fargo Bank, National Association, as
trustee (the Trustee), relating to the issuance by the Company of
$350million aggregate principal amount of 6.625% Senior Notes due
2027 (theNotes). The Notes were sold on April17, 2017 in a
private transaction exempt from the registration requirements of
the Securities Act of 1933 (the Securities Act), have not been
and will not be registered under the Securities Act, and may not
be offered or sold in the United States absent registration or an
applicable exemption from the registration requirements of the
Securities Act.
The Notes bear an interest rate of 6.625% per annum and will be
payable semi-annually in arrears on April15 and October15 of each
year, commencing on October15, 2017. The Notes mature on April15,
2027. The Notes are unsecured senior obligations of the Company
and are guaranteed on an unsecured senior basis by the
Guarantors.
The terms of the Notes are governed by the Indenture. The
Indenture contains customary covenants that, among other things,
limit the Companys and the Guarantors abilities to incur
additional indebtedness and issue preferred stock, pay dividends
on or purchase the Companys and the Guarantors equity interests,
make certain investments, incur liens on assets, enter into sale
and leaseback transactions, merge or consolidate with another
company, transfer or sell all or substantially all of the
Companys assets, and enter into transactions with affiliates.
Upon the occurrence of a change of control, as defined in the
Indenture, the Company is required to offer to repurchase the
Notes at 101% of the aggregate principal amount thereof, plus any
accrued and unpaid interest, if any, to the repurchase date.
The Company may redeem the Notes at any time on or after April15,
2022 at redemption prices of 103.313%, 102.208% and 101.104% of
the principal amount thereof if the redemption occurs during the
12-month periods beginning April15 of the years 2022, 2023 and
2024, respectively, and at a redemption price of 50% of the
principal amount thereof on and after April15, 2025, in each
case, plus accrued and unpaid interest, if any, to the applicable
redemption date. In addition, on or prior to April15, 2020 the
Company may redeem up to 40% of the aggregate principal amount of
the Notes with net cash proceeds of certain equity offerings of
the Company or Parent at a redemption price of 106.625% of the
principal amount thereof, plus accrued and unpaid interest, if
any, to the redemption date. The Company may also redeem all or
part of the Notes at a redemption price of 50% of the principal
amount thereof, plus a make-whole premium, on one or more
occasions prior to April15, 2022.
The Indenture contains customary events of default, including
failure to make required payments, failure to comply with certain
agreements or covenants, failure to pay or acceleration of
certain other indebtedness, certain events of bankruptcy and
insolvency, and failure to pay certain judgments. An event of
default under the Indenture will allow either the Trustee or the
holders of at least 25% in aggregate principal amount of the
then-outstanding Notes to accelerate, or in certain cases, will
automatically cause the acceleration of, the amounts due under
the Notes.
The foregoing description of the Indenture does not purport to be
complete, and is qualified in its entirety by reference to the
full text of the Indenture, a copy of which is filed as Exhibit
4.1 to this Current Report on Form 8-K and is incorporated herein
by reference.
Supplemental Indenture
On April17, 2017, the Company entered into a sixth supplemental
indenture (the Supplemental Indenture), among the Company, the
guarantors named therein and the Trustee, to the indenture, dated
April7, 2011, among the Company, the guarantors named therein and
the Trustee (the 2021 Notes Indenture), under which the Company
issued its 8.125% Senior Notes due 2021 (the 2021 Notes). The
Supplemental Indenture amends the 2021 Notes Indenture by, among
other things, eliminating certain restrictive covenants contained
in the 2021 Notes Indenture and reducing the minimum period
required for notice of redemption from 30 days to three business
days.
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The amendments to the 2021 Notes Indenture contained in the
Supplemental Indenture were effective as of April17, 2017 and
became operative when the Company accepted for purchase validly
tendered 2021 Notes representing a majority of the outstanding
2021 Notes to the Companys tender offer for all outstanding 2021
Notes (the Offer). As of 5:00 p.m., New York City time, on
Thursday, April13, 2017, the Company had received tenders of
approximately $238,978,000 aggregate principal amount of the 2021
Notes, representing approximately 95.59% of the aggregate
principal amount of the 2021 Notes outstanding.
The foregoing description of the Supplemental Indenture does not
purport to be complete, and is qualified in its entirety by
reference to the full text of the Supplemental Indenture, a copy
of which is filed as Exhibit 4.2 to this Current Report on Form
8-K and is incorporated herein by reference.
Registration Rights Agreement
In connection with the issuance of the Notes, the Company also
entered into a registration rights agreement dated April17, 2017
(the Registration Rights Agreement) among the Company, the
Guarantors and the initial purchasers of the Notes. Under the
Registration Rights Agreement, the Company and the Guarantors
agreed, among other things, (i)to file an exchange offer
registration statement with the Securities and Exchange
Commission (the SEC) with respect to the Notes and the guarantees
thereof within 180 days after April17, 2017, (ii) to use all
commercially reasonable efforts to have such exchange offer
registration statement declared effective by the SEC within 240
days after April17, 2017, and (iii)subject to certain
limitations, to consummate the exchange offer to which the
exchange offer registration statement relates within 30 business
days after the date on which the registration statement is
declared effective by the SEC. Under certain circumstances, the
Company and the Guarantors have agreed to file a shelf
registration statement with the SEC with respect to the resale of
the Notes and the guarantees thereof. If the Company does not
comply with these obligations, subject to limitations set forth
in the Registration Rights Agreement, the Company and the
Guarantors jointly and severally will be required to pay special
interest in an amount equal to 0.25% per annum of the principal
amount of the Notes, for the first 90 days following default.
Thereafter, the amount of special interest will increase by an
additional 0.25% per annum with respect to each subsequent 90-day
period until the default is cured, up to a maximum amount of 1.0%
per annum.
The initial purchasers of the Notes and their affiliates have,
from time to time, provided certain investment banking,
commercial banking and financial advisory services to the Company
and its affiliates, including acting as lender to the Company and
its affiliates and as a dealer-manager in connection with the
Companys tender offer for, and consent solicitation with respect
to, the 2021 Notes, for which they received customary fees and
commissions.
The foregoing description of the Registration Rights Agreement is
qualified in its entirety by reference to the Registration Rights
Agreement, a copy of which is filed as Exhibit 10.1 to this
current Report on Form 8-K and is incorporated herein by
reference.
Amended and Restated Credit Agreement
On April17, 2017, the Company also entered into a seventh amended
and restated credit agreement (the Credit Agreement) among the
Company, RBW Corporation of Canada the European borrowers party
thereto, the other loan parties thereto, the lenders party
thereto, JPMorgan Chase Bank, N.A., as administrative agent,
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian agent,
J.P. Morgan Europe Limited, as European agent and J.P. Morgan
Securities Inc., as sole lead arranger and bookrunning manager.
The Credit Agreement, among other things, provides an increased
revolving credit facility of up to $350million, extends the
maturity date of borrowings under the facility to April17, 2022
and amends fee and pricing terms. Furthermore, the Company has
the option, to the Credit Agreement, to increase the availability
under the revolving credit facility by an aggregate incremental
amount up to $100million.
Some of the financial institutions party to the Credit Agreement,
and some of their affiliates, have, from time to time, provided
certain investment banking, commercial banking and financial
advisory services to the Company and its affiliates, including
acting as lender to the Company and its affiliates and as a
dealer-manager in connection with the Companys tender offer for,
and consent solicitation with respect to, the 2021 Notes, for
which they received customary fees and commissions.
The foregoing description of the Credit Agreement is qualified in
its entirety by reference to the Credit Agreement, a copy of
which is filed as Exhibit 4.3 to this Current Report on Form 8-K
and is incorporated herein by reference.
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| Item2.03. |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The disclosure under Item 1.01 of this Current Report on Form 8-K
relating to the Indenture and the Credit Agreement is
incorporated herein by reference.
| Item9.01. | Financial Statements and Exhibits. |
(d) Exhibits:
|
Number |
Exhibit |
|
| 4.1 |
Indenture, dated April17, 2017, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee (including Form of Note). |
|
| 4.2 |
Sixth Supplemental Indenture, dated April17, 2017, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and Wells Fargo Bank, National Association, as trustee. |
|
| 4.3 |
Seventh Amended and Restated Credit Agreement, dated April17, 2017. Among Park-Ohio Industries, Inc., RBW Corporation of Canada, the European Borrowers (as defined therein) party thereto, the other Loan Parties (as defined therein), the Lenders (as defined therein), JPMorgan Chase Bank, N.A., as administrative agent, JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian agent, J.P. Morgan Europe Limited, as European agent and J.P. Morgan Securities Inc., as sole lead arranger and bookrunning manager. |
|
| 10.1 |
Registration Rights Agreement, dated April17, 2017, among Park-Ohio Industries, Inc., the Guarantors (as defined therein) and the initial purchasers that are party thereto. |
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About Park-Ohio Holdings Corp. (NASDAQ:PKOH)
Park-Ohio Holdings Corp. operates through the subsidiaries owned by its direct subsidiary, Park-Ohio Industries, Inc. (Park-Ohio). Park-Ohio is an industrial supply chain logistics and diversified manufacturing business operating in three segments: Supply Technologies, Assembly Components and Engineered Products. Supply Technologies provides its customers with Total Supply Management services for a range of production components. Assembly Components manufactures cast and machined aluminum components, automotive and industrial rubber and thermoplastic products, gasoline direct injection systems, fuel filler and hydraulic assemblies for automotive, agricultural equipment, construction equipment, heavy-duty truck and marine equipment industries. Engineered Products operates a group of manufacturing businesses that design and manufacture a range of products engineered for specific customer applications. Park-Ohio Holdings Corp. (NASDAQ:PKOH) Recent Trading Information
Park-Ohio Holdings Corp. (NASDAQ:PKOH) closed its last trading session up +0.75 at 36.60 with 34,259 shares trading hands.