UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 20, 2020
ADT Inc.
(Exact name of Registrant as specified in its charter)
| Delaware | | 001-38352 | | 47-4116383 |
(State of Incorporation) | | (Commission File Number) | | (I.R.S. Employer Identification No.) |
1501 Yamato Road Boca Raton, Florida | | 33431 |
| (Address of principal executive offices) | | (Zip Code) |
(561) 988-3600
(Registrant’s telephone number, including area code)
(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:
| ☐ | 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 Symbol(s) | | Name of each exchange on which registered |
| Common Stock, par value $0.01 per share | | ADT | | New York Stock Exchange |
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
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 |
First-Priority Senior Secured Notes
General
On August 20, 2020 (the “Closing Date”), Prime Security Services Borrower, LLC, a Delaware limited liability company (the “Issuer”), and Prime Finance Inc., a Delaware corporation (the “Co-Issuer” and, together with the Issuer, the “Issuers”), each a wholly owned indirect subsidiary of ADT Inc. (the “Company”), successfully completed the previously announced offering (the “Offering”) of $1,000 million aggregate principal amount of 3.375% first-priority senior secured notes due 2027 (the “Notes”).
The Issuers expect to use the proceeds from the Offering, along with cash on hand and/or borrowings under the Issuer's revolving credit facility, to (i) redeem all of the $1,000 million outstanding aggregate principal amount of the 6.250% Senior Notes due 2021 (the “2021 Notes”) of The ADT Security Corporation, an indirect wholly owned subsidiary of the Company (“ADTSC”), and (ii) pay related fees and expenses in connection with the transactions.
The Notes were offered and sold to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to persons outside of the United States in compliance with Regulation S under the Securities Act. The Notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent an effective registration statement or an applicable exemption from registration requirements or a transaction not subject to the registration requirements of the Securities Act or any state securities laws.
On the Closing Date, the Issuers and certain subsidiaries of the Issuers (the “Guarantors”) entered into an Indenture relating to the Notes, dated as of the Closing Date, by and among the Issuers, the Guarantors, as guarantors, and Wells Fargo Bank, National Association, as trustee (the “Trustee”) (the “Indenture”). The Issuers’ obligations under the Notes and the Indenture are guaranteed, jointly and severally, on a senior secured first-priority basis, by each of the Issuer’s existing domestic subsidiaries that guarantees its Ninth Amended and Restated First Lien Credit Agreement, dated as of July 1, 2015, as amended and restated on May 2, 2016, June 23, 2016, December 28, 2016, February 13, 2017, June 29, 2017, March 16, 2018, December 3, 2018, March 15, 2019 and September 23, 2019, and by each of its future domestic subsidiaries that guarantees certain of its debt. The Notes and the related guarantees are secured by first-priority security interests in substantially all of the tangible and intangible assets owned by each Issuer and Guarantor, subject to certain permitted liens and exceptions as further described in the Indenture and the related security documents.
Maturity and Interest Payments
The Notes will mature on August 31, 2027. Interest on the Notes will accrue at 3.375% per annum and will be paid semi-annually, in arrears on June 15 and December 15 of each year, beginning December 15, 2020.
Redemption
On or after August 31, 2026, the Issuers may redeem the Notes at their option, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed. In addition, prior to August 31, 2026, the Issuers may redeem the Notes at their option, in whole at any time or in part from time to time, at a redemption price equal to the greater of (i) 100% of the principal amount of the Notes to be redeemed and (ii) as determined by a quotation agent and delivered to the Trustee in writing, the sum of the present values of the aggregate principal amount of the Notes to be redeemed and the remaining scheduled payments of interest thereon due on any date after the redemption date to and including August 26, 2026 discounted at an adjusted treasury rate plus 50 basis points.
Certain Covenants
The Indenture contains covenants that limit the ability of each Issuer and its restricted subsidiaries to, among other things: (i) incur certain liens; (ii) enter into sale leaseback transactions; and (iii) consolidate, merge or sell all or substantially all of its assets.
These covenants are subject to a number of important limitations and exceptions. Additionally, upon the occurrence of specified change of control events, the Issuers may be required to redeem the Notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The Indenture also provides for customary events of default.
The foregoing description of the Indenture, does not purport to be complete and is subject to, and qualified in its entirety by reference to the full text of the Indenture, a copy of which is filed as Exhibit 4.1 and which is incorporated by reference herein.
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 under Item 1.01 is incorporated into this Item 2.03 by reference.
Item 7.01. Regulation FD.
On the Closing Date, ADTSC delivered a Notice of Redemption (the “Redemption Notice”) with respect to all of the outstanding 2021 Notes. The Redemption Notice was issued pursuant to the terms of the Indenture, dated as of July 5, 2012, as amended and supplemented through the date hereof (the “2021 Notes Indenture”), between ADTSC, the guarantors party thereto and Wells Fargo Bank, National Association, as trustee. Consequently, ADTSC will redeem all of the outstanding 2021 Notes on September 19, 2020 (the “Redemption Date”) at a redemption price (the “Redemption Price”) calculated pursuant to the 2021 Notes Indenture, plus the accrued and unpaid interest on the 2021 Notes so redeemed (the “Redemption”). ADTSC shall calculate the final Redemption Price prior to the Redemption Date in accordance with the provisions of the 2021 Notes Indenture. Because the Redemption Date is not a business day, payment of the Redemption Price will be made on September 21, 2020.
The information in this Item 7.01 is furnished solely pursuant to Item 7.01 of this Form 8-K. Consequently, it is not deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Exchange Act or Securities Act, if such subsequent filing specifically references this Form 8-K.
| B. | Closing of the Offering |
On the Closing Date, the Company issued a press release announcing the closing of the Offering and the Redemption. A copy of this press release is attached to this report as Exhibit 99.1 and incorporated by reference herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. | | Description |
| | | |
| 4.1 | | First-Priority Senior Secured Notes Indenture, dated as of August 20, 2020, by and among Prime Security Services Borrower, LLC, Prime Finance Inc., the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee and collateral agent. |
| | | |
| 99.1 | | Press Release, dated August 20, 2020, announcing Closing of First-Priority Senior Secured Notes. |
| | | |
| 104 | | Cover page Interactive Data File (embedded with the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Date: August 20, 2020 | ADT Inc. | |
| | | | |
| | By: | /s/ Jeffrey Likosar | |
| | Name: | Jeffrey Likosar | |
| | Title: | Executive Vice President, Chief Financial Officer and Treasurer | |
