Item 1.01 Entry into a Material Definitive Agreement.
Exit Credit Agreement
On the Effective Date, Windstream Services II, LLC, a Delaware limited liability
company and wholly owned subsidiary of New Windstream Holdings (the "Borrower"),
entered into the Credit Agreement ("Exit Credit Agreement") with New Windstream
Holdings, certain subsidiary guarantors, JPMorgan Chase Bank, N.A., as
administrative agent and collateral agent ("Exit Agent"), each letter of credit
issuer party thereto and each other lender from time to time party thereto.
Pursuant to the Exit Credit Agreement, the Borrower obtained (a) a "first out"
senior secured revolving credit facility (the "New Super-Senior Exit Revolving
Facility") in an aggregate committed amount of up to $500,000,000 and (b) a
senior secured first lien term loan facility (the "New Exit Term Facility" and,
together with the New Super-Senior Exit Revolving Facility, the "Exit
Facilities") in an aggregate principal amount of $750,000,000 (the loans
thereunder, the "Term Loans").
The proceeds of loans extended under the Exit Facilities have been or will be
used (i) for working capital and other general corporate purposes (ii) to pay
transaction costs, professional fees and other obligations and expenses incurred
in connection with the Exit Facilities, the consummation of the Plan and the
transactions contemplated thereunder, and (iii) for permitted acquisitions,
capital expenditures and transaction costs.
Loans under the New Exit Term Facility bear interest, at the option of Borrower,
at a rate equal to either LIBOR plus 6.25% or base rate plus 5.25%. Loans under
the New Super-Senior Exit Revolving Facility bear interest, at the option of
Borrower, at a rate equal to either LIBOR plus 3.00% or base rate plus 2.00%,
subject to two step downs of 25 basis points each based on achievement of
certain first lien secured leverage ratios. The New Super-Senior Exit Revolving
Facility and the New Exit Term Facility have a LIBOR floor of 1.00%.
The Exit Credit Agreement includes usual and customary negative covenants for
exit loan agreements of this type, including covenants limiting Borrower and its
restricted subsidiaries' (other than certain covenants therein which are limited
to subsidiary guarantors) ability to, among other things, incur additional
indebtedness, create liens on assets, make investments, loans or advances,
engage in mergers, consolidations, sales of assets and acquisitions, pay
dividends and distributions and make payments in respect of certain material
payment subordinated indebtedness, in each case subject to customary exceptions
. . .
Item 1.02 Termination of a Material Definitive Agreement.
Prepetition Indebtedness
Pursuant to the Plan, on the Effective Date, the obligations of the Debtors
under (i) the Prepetition Credit Agreement, dated as of dated July 17, 2006 (the
"Prepetition Credit Agreement"), by and among Windstream Services, LLC, as
borrower, the lenders party thereto, JPMorgan Chase Bank, N.A., as
administrative agent and collateral agent, as amended and restated (ii) the
indenture, dated November 6, 2017, among Windstream Services, LLC and Windstream
Finance Corp., as co-issuers (the "Pre-Petition Co-Issuers"), the entities
specified therein, as guarantors, and Delaware Trust Company, as successor
trustee and collateral agent, (iii) the Indenture, dated February 23, 1998, by
and among Windstream Holding of the Midwest, Inc., as issuer, and Ankura Trust
Company, LLC, in its capacity as successor trustee, (iv) the indenture, dated
August 2, 2018, between the Pre-Petition Co-Issuers, the entities specified
therein, as guarantors, and Wilmington Trust, National Association, as trustee
and collateral agent, (v) the indenture, dated August 2, 2018, between the
Pre-Petition Co-Issuers, the entities specified therein, as guarantors, and
Wilmington Trust, National Association, as trustee and collateral agent, and (v)
the indentures governing the Pre-Petition Co-Issuers' unsecured notes, were
cancelled.
Equity Interests
In accordance with the Plan, on the Effective Date, all shares of Windstream
Holdings' common stock issued and outstanding immediately prior to the Effective
Date, and any rights of any holder in respect thereof, were deemed cancelled,
discharged and of no further force or effect.
DIP Facilities
On the Effective Date, the senior secured superpriority debtor-in-possession
credit agreement, dated as of March 13, 2019, by and among Windstream Holdings,
Windstream Services, LLC, the other guarantors party thereto, the lenders party
thereto and Citibank, N.A., as administrative agent and collateral agent, was
paid in full and terminated.
Item 1.03 Bankruptcy or Receivership
On September 21, 2020, the Debtors filed a Notice of (I) Entry of Confirmation
Order, (II) Occurrence of Effective Date, and (III) Related Bar Dates. The
information set forth in the explanatory note is incorporated by reference into
this Item 1.03.
Item 2.03 Creation of Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 is incorporated by reference into this
Item 2.03.
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Item 3.02 Unregistered Sales of Equity Securities.
Pursuant to the Plan and following the cancellation of Windstream Holdings'
outstanding common stock described in this Current Report, on the Effective
Date, New Windstream Holdings issued new common units ("Units") and special
warrants to purchase Units to holders of allowed first lien claims and
participants in the $750 million rights offering. The issuance of the Units and
special warrants was exempt from registration under the Securities Act pursuant
to section 1145 of the Bankruptcy Code or another exemption from registration.
Item 3.03 Material Modification to the Rights of Security Holders.
The information set forth under the Introductory Note and Items 1.01, 1.02,
1.03, 5.01 and 5.03 of this Current Report on Form 8-K is incorporated herein by
reference.
Item 5.01 Changes in Control of Registrant.
On the Effective Date, pursuant to the Plan, and all equity interests in
Windstream Holdings outstanding immediately prior to the Effective Date, were
cancelled, discharged, and of no force and effect. On the Effective Date,
pursuant to the Plan, New Windstream Holdings issued Units and special warrants
to purchase such Units to holders of allowed first lien claims and participants
in the $750 million rights offering.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Pursuant to the Plan, Alan L. Wells, Samuel E. Beal III, Jeannie H.
Diefenderfer, Jeffrey T. Hinson, Julie A. Shimer, Michael G. Stoltz and Walter
L. Turek ceased to be directors of Windstream Holdings and Windstream Services.
David Brown, Randy Dunbar, Bruce Kenny, William G. LaPerch, W. Robert Mudge,
Paul H. Sunu, Tony Thomas, Anand Vadapalli, Michael C. Watchorn, Johannes Weber
and Jon Weber were designated as members of the Board of Managers of New
Windstream Holdings (the "Board of Managers"). Tony Thomas and Kristi M. Moody
are the members of the Board of Managers of Windstream Services II, LLC..
Management Incentive Plan
Pursuant to the Plan, New Windstream Holdings adopted a new management incentive
plan (the "Management Incentive Plan") providing for the issuance from time to
time, as approved by the Board of Managers, of equity and equity-based awards
with respect to New Windstream Holdings' common units. The common units issued
under the Management Incentive Plan on the Effective Date and in the future will
dilute all of the common units issued on the Effective Date.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
On the Effective Date, in connection with New Windstream Holdings'
implementation of the Plan, New Windstream Holdings' Amended Certificate of
Formation (the "Amended Certificate") and the Limited Liability Agreement were
adopted and approved, and the Amended Certificate was filed with the Delaware
Secretary of State.
Item 8.01 Other Events
Deregistration of Common Stock
In conjunction with its emergence from bankruptcy, Windstream Holdings and
Windstream Services (together, the "Registrants") intend to file post-effective
amendments to each of their respective Registration Statements on Form S-8 and
promptly file a Form 15 with the Securities and Exchange Commission (the "SEC")
to deregister their securities under Section 12(g) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and suspend each Registrant's
reporting obligations under Sections 13(a) and 15(d) of the Exchange Act. Upon
the filing of the Form 15, the Registrants' obligation to file periodic and
current reports with the SEC, including Forms 10-K, 10-Q and 8-K, will be
immediately suspended.
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Press Release
On September 21, 2020 the Company issued a press release announcing its
emergence from the restructuring process and successful consummation of the
Plan. A copy of the press release is attached hereto as Exhibit 99.1 and is
incorporated by reference into this Item 8.01.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are filed with this report:
Exhibit Number Description
99.1 Windstream Press Release dated September 21, 2020.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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