Item 1.01. Entry into a Material Definitive Agreement.
Indenture for 6.125% Senior Secured Notes due 2029
On March 25, 2021, Endo Luxembourg Finance Company I S.à r.l. (“Endo Luxembourg”) and Endo U.S. Inc. (together with Endo Luxembourg, the “Issuers”), each a wholly-owned subsidiary of Endo International plc (the “Company”), entered into an indenture, dated as of March 25, 2021 (the “Indenture”), among the Issuers, the guarantors named therein and Wells Fargo Bank, National Association, as trustee (the “Trustee”), governing the terms of the Issuers’ $1,295,000,000 aggregate principal amount of 6.125% Senior Secured Notes due 2029 (the “Notes”). The Notes were issued on March 25, 2021.
The Notes were issued in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), to qualified institutional buyers in accordance with Rule 144A under the Securities Act and to persons outside of the United States pursuant to Regulation S under the Securities Act. The Notes are senior secured obligations of the Issuers and are (i) guaranteed on a senior secured basis by the Company and certain of the Company’s subsidiaries that also guarantee the obligations under the Restated Credit Agreement (as defined below) and (ii) secured by first priority liens on the same collateral that secures the obligations under the Restated Credit Agreement and the Company’s existing first lien senior secured notes in accordance with the terms of the Indenture and the collateral trust agreement among the Company, the Borrowers (as defined below), the Issuers, certain other grantors party thereto, the Administrative Agent (as defined below), the Trustee and Wilmington Trust, National Association, as collateral trustee. The Notes and the related guarantees have not been, and will not be, registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
The Notes bear interest at a rate of 6.125% per year, accruing from March 25, 2021. Interest on the Notes is payable semiannually in arrears on April 1 and October 1 of each year, beginning on October 1, 2021. The Notes will mature on April 1, 2029, subject to earlier repurchase or redemption in accordance with the terms of the Indenture.
The Issuers may redeem some or all of the Notes at any time prior to April 1, 2024 at a price equal to 100% of the principal amount of the Notes redeemed plus accrued and unpaid interest, if any, to, but not including, the redemption date and a make-whole premium set forth in the Indenture. On or after April 1, 2024, the Issuers may redeem some or all of the Notes at any time at redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, at any time prior to April 1, 2024, the Issuers may redeem up to 40% of the aggregate principal amount of the Notes at a specified redemption price set forth in the Indenture plus accrued and unpaid interest, if any, to, but not including, the redemption date, with the net cash proceeds of specified equity offerings. If the Company experiences certain change of control events, the Issuers must offer to repurchase the Notes at 101% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the repurchase date.
The Indenture contains covenants that, among other things, restrict the Company’s ability and the ability of its restricted subsidiaries to incur certain additional indebtedness and issue preferred stock, make certain dividend payments, distributions, investments and other restricted payments, sell certain assets, agree to any restrictions on the ability of restricted subsidiaries to make certain payments to the Company or any of its restricted subsidiaries, create certain liens, merge, consolidate or sell all or substantially all of the Company’s assets, enter into certain transactions with affiliates or designate subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of important exceptions and qualifications, including the fall away or revision of certain of these covenants upon the Notes receiving investment grade credit ratings.
The Company intends to use the net proceeds from the offering, together with the proceeds of the New Term Loan (as defined below), to refinance the Existing Term Loan (as defined below).
The foregoing summary of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Indenture and the Notes, copies of which are filed with this Current Report on Form 8-K as Exhibits 4.1 and 4.2 and are incorporated herein by reference.
Certain of the initial purchasers and/or their affiliates participate in, or are agents and lenders under our Existing Credit Agreement and, as a result, will receive a portion of the net proceeds from the offering of the Notes.
