On November 17, 2020 , Gannett Co., Inc. (the “Company”) joined into a change contract (the “Exchange Agreement”) with specific associated with the loan providers (the “Exchanging Lenders”) beneath the business’s senior secured 11.5% term loan Credit Agreement dated November 19, 2019 (the “Credit Agreement”) pursuant to which the business as well as the Exchanging Lenders consented to trade roughly $500 million in aggregate amount that is principal of business’s newly released 6% Senior Secured Convertible Notes due 2027 (the “Notes”) for the your your retirement of an equal number of term loans underneath the Credit contract (the “Exchange”). After the Exchange, the term that is remaining may have a highly skilled principal stability of $1.118 billion (the “Remaining Term Loan”). The Notes were granted pursuant to an Indenture (the “Indenture”) dated at the time of 17, 2020 , between the Company and U.S. Bank National Association , as trustee november.
Relating to the Exchange, the business joined into an Investor contract (the “Investor Agreement”) with all the holders associated with the records (the “Holders”) developing specific stipulations regarding the liberties and limitations regarding the Holders with regards to the Holders’ ownership associated with Notes. The organization additionally entered into an amendment to your Registration Rights Agreement dated 19, 2019 between the Company and FIG LLC november . In addition, the Remaining Term Loan will likely be amended as described below (the “Amendment”).
Records and Indenture
The Notes are fully guaranteed by Gannett Holdings LLC and any subsidiaries of this business (collectively, the “Guarantors”) that guarantee the Remaining Term Loan. The Notes is guaranteed because of the same collateral securing the Remaining Term Loan. The Notes ranking as senior secured financial obligation regarding the Company, utilizing the following security priorities: (i) prior to a Permitted Refinancing (as defined within the Indenture) of all of the staying indebtedness under the Remaining Term Loan with brand new first lien debt that meets certain requirements of the Refinancing Facility (as defined within the Indenture), including, among other items, that (a) the key number of this new financial obligation will not surpass the total amount associated with the Remaining Term Loan (plus interest and charges), (b) the all-in-yield of this brand new debt will not go beyond 9.5% per year and (c) one other regards to this new financial obligation are no less favorable to your business, the Notes and staying Term Loan will share within the security underneath the Remaining Term Loan on a pari passu foundation; and (ii) after any Permitted Refinancing, the Notes is supposed to be guaranteed by a second concern lien on a single security package securing the indebtedness incurred associated with the Permitted Refinancing.
The business will probably pay interest in the Notes at a annual price of 6.000% payable on June 1 and December 1 of every year, starting on June 1, 2021 . The Notes will grow on 1, 2027 , unless earlier repurchased or converted december.
Each Note is convertible into that true quantity of stocks of typical stock (“Common Stock”) of this business add up to $1,000 divided by the transformation cost (the “Conversion speed”). The records can be converted whenever you want by the holders into money, shares regarding the organization’s typical stock (“Common Stock”) or any mixture of cash and typical look at here now inventory, in the business’s election, centered on an initial conversion price of 200 stocks of Common Stock per $1,000 principal number of the Notes (that will be corresponding to a transformation price of $5.00 per share of Common Stock (the “Conversion Price”), representing a transformation premium of around 187% in line with the closing price of $1.74 per share of typical Stock on November 16 , 2020).
The transformation price is at the mercy of customary modification conditions as supplied into the Indenture. The Notes would be convertible into approximately 42% of the Common Stock after giving effect to such issuance or sale (assuming the initial principal amount of the Notes remains outstanding) in addition, the conversion rate will be subject to adjustment in the event of any issuance or sale of Common Stock (or securities convertible into Common Stock) at a price equal to or less than the Conversion Price in order to ensure that following such issuance or sale.
In case a ” Make-Whole Fundamental Change” (since defined when you look at the Indenture) happens, the organization will in a few circumstances raise the transformation price for the certain period of the time. In case a “Fundamental modification” (because defined into the Indenture) does occur, the business will undoubtedly be necessary to provide to repurchase the Notes at a repurchase cost of 110per cent for the principal quantity thereof.
The Company will have the right to redeem for cash up to approximately $100 million of the Notes at a redemption price of 130% of the principal amount thereof, with such amount reduced ratably by any principal amount of Notes that has been converted by the holders or redeemed or purchased by the Company until the four-year anniversary of the issuance date.
After a meeting of Default (because defined in the Indenture), the Notes will soon be susceptible to an “asset sale” sweep, “excess cash flow” sweep and “unrestricted cash” sweep substantially identical into the matching conditions into the Remaining Term Loan. Mandatory prepayments pursuant to these conditions will likely to be provided ratably between holders of this Notes and holders for the term that is remaining as supplied within the Indenture and related intercreditor agreements.
Holders for the Notes could have the ability to set up to about $100 million associated with Notes at par, (a) for provided that the residual Term Loan continues to be outstanding, on or following the 4th anniversary associated with the issuance date, or (b) after a Permitted Refinancing, on or following the date that is 91 times following the readiness date of such refinancing that is permitted.
The business may refinance the Remaining Term Loan with brand new very first lien financial obligation, so long as this new first lien financial obligation satisfies certain requirements of the Permitted Refinancing. In case the business proposes to get into a Permitted Refinancing, Holders regarding the Notes may have the possibility to require the Company to repurchase their Notes at a high price corresponding to 101.5per cent of par, which amount increase by 1.5percent for each three thirty days anniversary of this issuance date regarding the Notes. The Indenture permits the organization to increase extra first lien or 2nd lien debt to invest in such repurchases, at the mercy of particular conditions established therein.