Item 1.01. Entry into a Material Definitive Agreement.
On February 25, 2021, Bristow Group Inc. (the “Company”) and its wholly-owned subsidiaries Bristow Holdings U.S. Inc., BHNA Holdings Inc., Bristow Helicopters Inc., Bristow U.S. Leasing LLC, Bristow U.S. LLC, Era Aeróleo LLC, Aeróleo Internacional, LLC, Era Helicopters, LLC, Era Leasing LLC, Bristow U.S. Holdings LLC, BL US Holdings LLC, Bristow Holdings Company Ltd., Bristow Holdings Company Ltd. III, Bristow Cayman Ltd., BriLog Leasing Ltd., Bristow Equipment Leasing Ltd., Bristow Canadian Real Estate Company Inc. and Bristow Canada Holdings Inc. (collectively, the “Guarantors”) entered into an Indenture (the “Indenture”) with U.S. Bank National Association, as trustee (the “Trustee”) and as collateral agent (the “Collateral Agent”), pursuant to which the Company issued $400,000,000 aggregate principal amount of its 6.875% Senior Secured Notes due 2028 (the “Notes”) in a private offering (the “Offering”) to eligible purchasers pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended (the “Securities Act”).
The Notes will initially be fully and unconditionally guaranteed, jointly and severally, on a senior secured basis by the Guarantors and will be secured by first priority security interests on certain helicopters and related assets, together with substantially all of the other tangible and intangible personal property assets of the Company and the Guarantors (other than certain excluded assets) (the “Collateral”) as collateral security for their obligations under the Notes, subject to certain permitted encumbrances and exceptions. Certain of the security interests will be granted in connection with the execution and delivery of the Indenture, while security interests anticipated to cover approximately 93 aircraft will be granted within the periods described in the Indenture.
The Notes will bear interest at a rate of 6.875% per year, payable semi-annually in arrears on March 1 and September 1 of each year, beginning on September 1, 2021. The Notes will mature on March 1, 2028. The Company may redeem all or a portion of the Notes at any time on or after March 1, 2024 at the applicable redemption price in accordance with the terms of the Notes and the Indenture, plus accrued and unpaid interest and Additional Amounts (as defined in the Indenture), if any, to the redemption date. At any time prior to March 1, 2024, the Company may redeem all or a portion of the Notes at a price equal to 100% of the principal amount of Notes to be redeemed plus a “make-whole” premium, plus accrued and unpaid interest and Additional Amounts, if any, to the redemption date. In addition, on one or more occasions, on or prior to March 1, 2024, the Company may redeem up to 35% of the aggregate principal amount of the Notes at a redemption price equal to 106.875% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest and Additional Amounts, if any, to the redemption date, with an amount of cash not greater than the net cash proceeds of certain qualified equity offerings by the Company.
The Indenture contains customary covenants that, among other things, limit our ability to incur additional liens or financial indebtedness and to sell or otherwise transfer the Collateral, including the pledged aircraft. The Indenture also contains customary events of default. If an event of default occurs and is continuing, the Trustee or the holders of at least 25% in principal amount of the then outstanding Notes may declare the unpaid principal of, and any premium and accrued and unpaid interest on, all the Notes then outstanding to be due and payable immediately. In case of certain events of bankruptcy, insolvency or reorganization with respect to the Company, any Guarantor or any significant subsidiary, all of the principal of and accrued and unpaid interest and Additional Amounts on the Notes will automatically become due and payable. Upon a Change of Control Trigger Event (as defined in the Indenture), we will be required to make an offer to repurchase all or any part of each Note at an offer price in cash equal to 101% of the aggregate principal amount, plus accrued and unpaid interest and Additional Amounts, if any, to the date of repurchase.
The proceeds of the Notes were used, together with cash on hand, to repay approximately $153.4 million with respect to the Company’s secured equipment term loan with Macquarie Bank Limited and approximately $206.2 million with respect to the Company’s term loans with PK AirFinance S.à r.l. (collectively, the “Term Loans”) and will be used to fund the previously announced redemption of all of the Company’s outstanding 7.750% Senior Notes due 2022 with an aggregate principal amount of approximately $132.0 million outstanding, which notes were satisfied and discharged on the closing date of the Offering.
The foregoing description of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Indenture and the form of Note, copies of which are filed as Exhibits 4.1 and 4.2 hereto, respectively.
