Item 1.01. Entry into a Material Definitive Agreement.
On May 8, 2020, Venator Finance S.à r.l, a private limited liability company
(société à responsabilité limitée) incorporated under the laws of the Grand
Duchy of Luxembourg (the "Issuer") and Venator Materials LLC, a Delaware limited
liability company (the "Co-Issuer" and, together with the Issuer, the
"Issuers"), each a wholly owned subsidiary of Venator Materials PLC (the
"Company"), entered into a purchase agreement (the "Purchase Agreement"), by and
among the Issuers, the guarantors party thereto and J.P. Morgan Securities LLC,
as representative of the initial purchasers listed in Schedule I thereto
(collectively, the "Initial Purchasers"), pursuant to which the Issuers agreed
to issue and sell to the Initial Purchasers $225 million in aggregate principal
amount of the Issuers' 9.500% senior secured notes due 2025 (the "Notes").
The Notes will be senior secured obligations of the Issuers, and interest will
be payable semi-annually in arrears. The Notes will be guaranteed (the
"Guarantees") on a senior secured basis by the Company and each of the Company's
restricted subsidiaries (other than the Issuers and certain other excluded
subsidiaries) that is a guarantor under the Company's term loan credit facility
(the "Term Loan Facility"). In the future, the Notes will also be guaranteed on
a senior secured basis by each of the Company's restricted subsidiaries (other
than the Issuers and certain other excluded subsidiaries) that is a guarantor
under the Company's asset-based revolving lending facility (the "ABL Facility").
The Notes will be secured on a first-priority basis by liens on all of the
assets that secure the Term Loan Facility on a first-priority basis and will be
secured on a second-priority basis in all inventory, accounts receivable,
deposit accounts, securities accounts, certain related assets and other current
assets that secure the ABL Facility on a first-priority basis and the Term Loan
Facility on a second-priority basis, in each case other than certain excluded
The Notes and the Guarantees will be sold to the Initial Purchasers at 98.008%
of par, and the sale will result in gross proceeds (after deducting the Initial
Purchasers' discount and estimated offering expenses) to the Issuers of
approximately $220,518,000, which the Issuers intend to use to repay borrowings
under the ABL Facility, to pay fees and expenses related to the offering and for
general corporate purposes, including enhancing the Company's liquidity
position. The closing of the issuance and sale of the Notes and the Guarantees
is expected to occur on or about May 22, 2020, subject to customary closing
The Notes and the Guarantees will be issued and sold to the Initial Purchasers
pursuant to an exemption from the registration requirements of the Securities
Act of 1933, as amended (the "Securities Act"), pursuant to
Section 4(2) thereunder. The Initial Purchasers intend to resell the Notes and
Guarantees (i) inside the United States to persons reasonably believed to be
"qualified institutional buyers," as defined in Rule 144A ("Rule 144A"), under
the Securities Act in private sales exempt from registration under the
Securities Act in accordance with Rule 144A and (ii) to non-U.S. persons
pursuant to offers and sales that occur outside the United States within the
meaning of Regulation S under the Securities Act ("Regulation S") in accordance
with Regulation S. The Notes and Guarantees will not initially be registered
under the Securities Act or applicable state securities laws 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 and
applicable state laws.
The Purchase Agreement contains customary representations, warranties and
covenants and includes the terms and conditions for the sale of the Notes and
the Guarantees, indemnification (including indemnification for liabilities under
the Securities Act) and contribution obligations and other terms and conditions
customary in agreements of this type.
The Initial Purchasers and their affiliates have engaged, and may in the future
engage, in investment banking, commercial banking and other financial advisory
and commercial dealings with the Company and its affiliates. Certain affiliates
of the Initial Purchasers are lenders under the ABL Facility and will receive a
portion of the proceeds from the offering to the extent that such proceeds are
being used to repay borrowings under the ABL Facility.
In addition, the Issuers and the Guarantors have agreed with the Initial
Purchasers not to offer, sell, contract to sell, pledge or otherwise dispose of
any debt securities (other than the Notes) issued or guaranteed by the Issuers
or any of the Guarantors for a period of 45 days after the date of the Purchase
Agreement without the prior consent of J.P. Morgan Securities LLC.
The foregoing description of the Purchase Agreement is qualified in its entirety
by reference to the Purchase Agreement, a copy of which is attached hereto as
Exhibit 10.1 and is incorporated herein by reference.
Item 7.01. Regulation FD Disclosure.
On May 8, 2020, the Company issued a press release announcing the pricing of the
A copy of the press release is furnished with this Form 8-K as Exhibit 99.1 and
incorporated into this Item 7.01 by reference.
The information in this Item 7.01 (including the exhibits) shall not be deemed
to be "filed" for purposes of Section 18 of the Exchange Act of 1934, as amended
(the "Exchange Act") or otherwise subject to the liabilities of that section,
and is not incorporated by reference into any filing under the Securities Act or
the Exchange Act.
Item 9.01. Financial Statements and Exhibits.
Number Description of Exhibits
10.1 Purchase Agreement, dated May 8, 2020, by and among Venator Finance
S.à r.l, Venator Materials LLC, the guarantors party thereto and J.P.
Morgan Securities LLC, as representative of the initial purchasers
listed in Schedule I thereto.
99.1 Press release dated May 8, 2020 regarding the pricing of the Notes.
104 The cover page from this Current Report on Form 8-K, formatted in Inline
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