Item 1.01. Entry into a Material Definitive Agreement.
Issuance of 4.750% senior notes due 2031
On June 8, 2021, Boyd Gaming Corporation (the “Company”) issued $900 million aggregate principal amount of 4.750% senior notes due 2031 (the “2031 Notes”). The 2031 Notes were sold to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and in offshore transactions to non-U.S. persons under Regulation S of the Securities Act. As previously announced, the Company is using the proceeds from the offering to finance a portion of the redemption of all of its outstanding 6.375% senior notes due 2026 and 6.000% senior notes due 2026.
Indenture relating to 2031 Notes
The 2031 Notes were issued pursuant to an Indenture, dated as of June 8, 2021, by and among the Company, the guarantors named therein and Wilmington Trust, National Association, as trustee (the “Indenture”).
The Indenture provides that the 2031 Notes will bear interest at a rate of 4.750% per annum, payable semi-annually on March 15 and September 15 of each year, commencing on September 15, 2021. The 2031 Notes will mature on June 15, 2031 and are fully and unconditionally guaranteed by certain of the Company’s current and future domestic restricted subsidiaries.
Prior to June 15, 2026, the Company may redeem the 2031 Notes, in whole or in part, at a redemption price of 100% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest (as defined in the Indenture), if any, up to, but excluding, the applicable redemption date, plus a make-whole premium.
The Company may redeem some or all of the 2031 Notes on or after June 15, 2026 at the redemption prices specified below, plus accrued and unpaid interest and Additional Interest, if any, up to, but excluding, the applicable redemption date:
| | | | |
Year | | Percentage | |
2026 | | | 102.375 | % |
2027 | | | 101.583 | % |
2028 | | | 100.792 | % |
2029 and thereafter | | | 100.000 | % |
In addition, at any time prior to June 15, 2024, the Company may redeem up to 40% of the aggregate principal amount of the 2031 Notes at a redemption price equal to 104.750% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, if any, up to, but excluding, the applicable redemption date, with the net cash proceeds that the Company raises in one or more equity offerings.
The Indenture contains covenants that, subject to exceptions and qualifications, among other things, limit the Company’s ability and the ability of its Restricted Subsidiaries (as defined in the Indenture) to (i) incur additional indebtedness or liens; (ii) pay dividends or make distributions or repurchase the Company’s capital stock; (iii) make certain investments; and (iv) sell or merge with other companies. Upon the occurrence of a Change of Control (as defined in the Indenture), the Company will be required, unless certain conditions are met, to offer to repurchase the 2031 Notes at a price equal to 101% of the principal amount of the 2031 Notes, plus any accrued and unpaid interest and Additional Interest, if any, up to, but not including, the date of purchase. If the Company sells assets, it will be required under certain circumstances to offer to purchase the 2031 Notes.
The Indenture contains customary events of default including, without limitation, failure to make required payments, failure to comply with certain agreements or covenants, cross-acceleration to certain other indebtedness in excess of specified amounts, certain events of bankruptcy and insolvency, and failure to pay certain judgments. An event of default under the Indenture will allow either the trustee or the holders of at least 30% in aggregate principal amount of the then outstanding 2031 Notes to accelerate, or in certain cases, will automatically cause the acceleration of, the amounts due under the 2031 Notes.
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