Valmont Industries,Inc. (NYSE:VMI) Files An 8-K Entry into a Material Definitive AgreementItem 1.01. Entry into a Material Definitive Agreement
As previously announced, on June8, 2018, Valmont Industries,Inc. (the “Company”) and its subsidiaries Valmont Coatings,Inc., PiRod,Inc., Valmont Newmark,Inc. and Valmont Queensland Pty Ltd. (the “Subsidiary Guarantors”) entered into an underwriting agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC, as representative of the several underwriters named in the Underwriting Agreement, with respect to the issuance and sale of $200 million aggregate principal amount of the Company’s 5.00% Senior Notes due 2044 (the “2044 Notes”) and $55 million aggregate principal amount of the Company’s 5.25% Senior Notes due 2054 (the “2054 Notes” and, together with the 2044 Notes, the “Notes”) and the guarantee of the Notes by the Subsidiary Guarantors. The Notes were issued and sold on June19, 2018 in a public offering to a Registration Statement on FormS-3 (Registration No.333-224935) and a related prospectus supplement, each filed with the Securities and Exchange Commission.
The Notes were issued to an Indenture dated as of April12, 2010, a Second Supplemental Indenture dated as of September22, 2014 (with respect to the 2044 Notes) and a Third Supplemental Indenture dated as of September22, 2014 (with respect to the 2054 Notes), each among the Company, the Subsidiary Guarantors and Wells Fargo Bank, National Association, as trustee (collectively, the “Indenture”). The Notes were issued as additional notes under the Indenture, to which the Company previously issued $250 million aggregate principal amount of 2044 Notes and $250 million aggregate principal amount of 2054 Notes.
The Notes are guaranteed by the Subsidiary Guarantors to the terms of the Indenture. The 2044 Notes will pay interest semi-annually on April1 and October1, beginning on October1, 2018, at a rate of 5.00% per annum until maturity at October1, 2044. Interest on the 2044 Notes accrues from April1, 2018. The 2054 Notes will pay interest semi-annually on April1 and October1, beginning on October1, 2018, at a rate of 5.25% per annum until maturity at October1, 2054. Interest on the 2054 Notes accrues from April1, 2018. Repayment of the Notes may be accelerated upon the occurrence of a change of control triggering event specified in the Indenture or certain customary events of default specified in the Indenture. Upon the occurrence of a change of control triggering event, the Company will be required to make an offer to purchase the Notes at a price in cash equal to 101% of the principal amount plus accrued and unpaid interest through the date of repurchase.
The issuance and sale of the Notes resulted in net proceeds, before offering expenses but after deducting underwriting discounts, of approximately $235.3 million. The Company intends to use the net proceeds to fund a portion of the redemption of all $250.2 million of its outstanding 6.625% Senior Notes due 2020 (the “2020 Notes”) on July9, 2018. The 2020 Notes will be redeemed at a redemption price equal to the greater of (a)50% of the principal amount of the notes to be redeemed or (b)the sum of the present values of the remaining scheduled payments of principal and interest on the notes (not including any portion of those payments of interest accrued to the redemption date) from the redemption date to the maturity date of the notes. In each case, the 2020 Notes to be redeemed will be discounted to the redemption date on a semi-annual basis at the Adjusted Treasury Rate (as defined in the 2020 Notes) plus 45 basis points, plus accrued and unpaid interest on the notes from April20, 2018 to, but excluding, the redemption date. The redemption price for the 2020 Notes will be calculated in accordance with
