8-K: Current report filing
Published on August 22, 2023
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| (Address of principal executive offices) (Zip Code) |
Registrant’s telephone number, including area code:
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
Trading |
Name of each exchange |
||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry into a Material Definitive Agreement. |
Indenture Governing 9.000% Senior Secured Notes Due 2028
On August 22, 2023, Clear Channel Outdoor Holdings, Inc. (the “Company”) completed the sale of $750 million in aggregate principal amount of 9.000% Senior Secured Notes due 2028 (the “Notes”) in a private placement to persons reasonably believed to be qualified institutional buyers in reliance on the exemption from registration pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to persons outside the United States in compliance with Regulation S under the Securities Act. The Notes were issued pursuant to an indenture, dated as of August 22, 2023 (the “Indenture”), among the Company, the subsidiaries of the Company acting as guarantors party thereto (collectively, the “Guarantors”) and U.S. Bank Trust Company, National Association, as trustee and as collateral agent.
The Notes mature on September 15, 2028 and bear interest at a rate of 9.000% per annum. Interest on the Notes is payable to the holders thereof semi-annually on March 15 and September 15 of each year, beginning on March 15, 2024. The Notes are guaranteed fully and unconditionally on a senior secured basis by the Guarantors and any of the Company’s future wholly-owned domestic subsidiaries that guarantee the Company’s obligations under the Company’s senior secured term loan facility (the “Term Loan Facility”), its senior secured revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “Senior Secured Credit Facilities”) and its receivables-based credit facility (the “ABL Facility”).
The Notes and the guarantees are secured on a first-priority basis by security interests in all of the Company’s and the Guarantors’ assets securing the Senior Secured Credit Facilities and the Existing Secured Notes (as defined below) (other than the assets securing the ABL Facility on a first-priority basis), subject to certain exceptions, on a pari passu basis with the liens on such assets (such assets, other than accounts receivable and certain other assets securing the ABL Facility on a first priority basis, the “Notes Priority Collateral”), and on a second-priority basis by security interests in all of the Company’s and the Guarantors’ assets securing the Company’s ABL Facility on a first-priority basis (the “ABL Priority Collateral” and, together with the Notes Priority Collateral, the “Notes Collateral”), in each case, other than any excluded assets set forth in the Indenture and subject to intercreditor agreements. The ABL Facility is secured on a second-priority basis by the Notes Priority Collateral.
The Notes and the guarantees are general senior secured obligations of the Company and the Guarantors and rank pari passu in right of payment with the Company’s and the Guarantors’ existing and future senior indebtedness, including the Senior Secured Credit Facilities, the ABL Facility, the 5.125% senior secured notes due 2027 (the “Existing Secured Notes”), the 7.750% senior notes due 2028 and the 7.500% senior notes due 2029 and will be senior in right of payment to all existing and future subordinated indebtedness of the Company and the Guarantors. The Notes are effectively equal to all of the Company’s and the Guarantors’ existing and future indebtedness secured by a first-priority lien on the Notes Priority Collateral (including the Senior Secured Credit Facilities and the Existing Secured Notes), to the extent of the value of such collateral, are effectively subordinated to all of the Company’s and the Guarantors’ existing and future indebtedness secured by a first-priority lien on the ABL Priority Collateral (including the ABL Facility), to the extent of the value of such collateral, and are structurally subordinated to any existing and future indebtedness and other liabilities, including preferred stock, of existing and future subsidiaries of the Company that do not guarantee the Notes, including Clear Channel International B.V.’s 6.625% senior secured notes due 2025.
The Company may redeem all or a portion of the Notes beginning on September 15, 2025 at the redemption prices set forth in the Indenture. Prior to September 15, 2025, the Company may redeem all or a portion of the Notes at a redemption price equal to 100.000% of the principal amount of the Notes, plus the “make-whole” premium described in the Indenture. The Company may redeem up to 40% of the aggregate principal amount of the Notes at any time prior to September 15, 2025 using the net proceeds from certain equity offerings at 109.000% of the principal amount of the Notes. During any twelve-month period prior to September 15, 2025, subject to certain exceptions and conditions, the Company may also redeem up to 10% of the then-outstanding aggregate principal amount of Notes at a redemption price equal to 103.000% of the aggregate principal amount of the Notes being redeemed; provided that, at the time of any such redemption, there are no outstanding borrowings under the Senior Secured Credit Facilities (including any amounts drawn under any revolving credit facility or other borrowings outstanding in respect of any term loans), and no such redemption can be made with the proceeds of any indebtedness that refinances existing indebtedness. If the Company experiences certain specific types of changes in control, the Company must offer to repurchase all of the notes at 101.000% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.
The Indenture contains covenants that limit the Company’s ability and the ability of its restricted subsidiaries to, among other things: (i) incur or guarantee additional debt or issue certain preferred stock; (ii) redeem, purchase or retire subordinated debt; (iii) make certain investments; (iv) create restrictions on the payment of dividends or other amounts from the Company’s restricted subsidiaries that are not Guarantors; (v) enter into certain transactions with affiliates; (vi) merge or consolidate with another person or sell or otherwise dispose of all or substantially all of the Company’s assets; (vii) sell certain assets, including capital stock of the Company’s subsidiaries; (viii) designate the Company’s subsidiaries as unrestricted subsidiaries; (ix) pay dividends, redeem or repurchase capital stock or make other restricted payments; and (x) incur certain liens.
Copies of the Indenture and the Notes are attached hereto as Exhibits 4.1 and 4.2, respectively, and are incorporated herein by reference. The foregoing descriptions of the Indenture and the Notes do not purport to be complete and are qualified in their entirety by reference to the complete text of the Indenture and the Notes, respectively.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
| Item 9.01 | Financial Statements and Exhibits. |
| Exhibit No. | Description |
|
| 4.1 | Indenture, dated as of August 22, 2023, by and among Clear Channel Outdoor Holdings, Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and as collateral agent, governing the 9.000% Senior Secured Notes due 2028. | |
| 4.2 | Form of 9.000% Senior Secured Notes due 2028 (incorporated by reference to Exhibit A to Exhibit 4.1 filed herewith). | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CLEAR CHANNEL OUTDOOR HOLDINGS, INC. | ||||||
| Date: August 22, 2023 | By: | /s/ Brian D. Coleman |
||||
| Brian D. Coleman | ||||||
| Chief Financial Officer | ||||||