Item 1.01. Entry Into a Material Definitive Agreement.
On September 28, 2017, TTM Technologies, Inc. (the “Company”) and certain of its domestic subsidiaries entered into a number of
material definitive agreements in connection with the Company’s previously announced debt refinancing, including the closing of the Company’s offering (the “Offering”) of $375.0 million in aggregate principal amount of its
5.625% senior notes due 2025 (the “Notes”) and the syndication of a new $350.0 million senior secured term loan that matures in September 2024 (the “New Term Loan Facility”). The Offering was conducted as a private placement
exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Company used the Offering proceeds, together with borrowings under its New Term Loan Facility, to refinance the full amount of
indebtedness outstanding under its previous term loan facility and repay a portion of the amounts outstanding under its U.S. senior secured revolving credit facility, as well as to pay related fees and expenses.
Senior Notes Indenture
On September 28, 2017, the Company issued and sold the Notes, which were priced at par value. Interest on the Notes accrues at the rate of
5.625% per annum and is payable semi-annually in cash in arrears on April 1 and October 1of each year, beginning on April 1, 2018. The Notes were issued pursuant to an indenture, dated as of September 28, 2017 (the
“Indenture”), by and among the Company, the Guarantors (as defined below) and Wilmington Trust, National Association, as trustee (in such capacity, the “Indenture Trustee”).
The Notes are irrevocably and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Company’s existing and
future domestic subsidiaries, subject to certain exceptions (collectively, the “Guarantors”). The Notes and related guarantees are senior unsecured obligations of, respectively, the Company and its Guarantors, and rank equally in right of
payment with all of the Company’s and Guarantors’ existing and future senior unsecured indebtedness. The Notes and related guarantees will be effectively subordinated to any of the Company’s and Guarantors’ existing and future
secured debt, including the New Term Loan Facility and the Company’s U.S. asset-based lending credit agreement to the extent of the value of the assets securing such debt. In addition, the Notes and related guarantees are structurally
subordinated to the liabilities of the Company’s
non-guarantor
subsidiaries, including indebtedness of the Company’s foreign subsidiaries under the Company’s Asia asset-based lending credit
agreement.
The Notes will mature on October 1, 2025. Prior to October 1, 2020, the Company may on any one or more occasions
redeem up to 40% of the original aggregate principal amount of the Notes at a redemption price of 105.625% of the aggregate principal amount of the Notes redeemed, with the net cash proceeds of certain equity offerings (in each case, within 90 days
of the closing date of any such offerings), so long as at least 60% of the original aggregate principal amount of Notes originally issued under the Indenture remains outstanding immediately after the occurrence of each such redemption. At any time
prior to October 1, 2020, the Company may redeem some or all of the Notes at a redemption price equal to 100% of the principal amount of the Notes plus a “make-whole” premium. On or after October 1, 2020, the Company may redeem
some or all of the Notes at the applicable redemption price as set forth in the Indenture. If the Company undergoes a change of control (as defined in the Indenture), it will be required to offer to purchase Notes from holders at 101% of their
principal amount. If the Company or its restricted subsidiaries dispose of assets, under certain circumstances when the cumulative amount of excess net proceeds not otherwise applied as permitted under the Indenture exceeds $50.0 million, the
Company will be required to use such cumulative amount of excess net proceeds to offer to purchase Notes from holders at an offer price in cash equal to 100% of the outstanding principal amount of such Notes. These restrictions and prohibitions are
subject to certain qualifications and exceptions. Accrued and unpaid interest to the date of redemption or purchase on the Notes would also be payable in each of the foregoing events of redemption or purchase. The Company is not required to make
mandatory redemption or sinking fund payments with respect to the Notes.
The Indenture contains customary covenants that, among other
things, limit the ability of the Company and its restricted subsidiaries to pay dividends on, redeem or repurchase the Company’s capital stock, make investments or restricted payments, prepay, redeem or repurchase certain debt, enter into
transactions with affiliates, sell assets, create liens, incur or guarantee additional indebtedness, designate unrestricted subsidiaries, issue certain preferred stock or similar equity securities, engage in a merger, sale or consolidation, and
enter into agreements restricting the ability of the Company’s restricted subsidiaries to pay dividends and make other distributions. Certain of the covenants will be suspended upon the Notes achieving an investment grade rating from specified
rating agencies. In addition, the Indenture requires, among other things, the Company to prepare financial and current reports and make such reports available to the Indenture Trustee and holders of the Notes or file such reports electronically with
the U.S. Securities and Exchange Commission (the “SEC”). All of the covenants are subject to a number of important exceptions, limitations and qualifications under the Indenture.
Repayment of the Notes may be accelerated upon the occurrence of customary events of default, including, but not limited to, failure to make
payment, failure to comply with the obligations set forth in the Indenture, certain defaults on certain other indebtedness, and invalidity of the guarantees under the notes issued pursuant to the Indenture.
Copies of the Indenture and form of Note are filed as Exhibits 4.1 and 4.2, respectively, to this
Current Report on Form
8-K
(“Report”) and incorporated herein by reference thereto. 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 Notes.
The Company has various relationships with the initial purchasers
of the Notes. Certain of the initial purchasers and their affiliates have engaged, and may in the future engage, in investment banking, commercial banking and other financial advisory and commercial dealings with the Company and its affiliates. In
particular, affiliates of certain of the initial purchasers have a lending relationship with the Company under the New Term Loan Facility and the Company’s U.S. senior secured revolving credit facility and, accordingly, received a portion of
the net proceeds from the Offering. These initial purchasers, or their respective affiliates, have received, and may in the future receive, customary fees and expenses for those services.
New Term Loan Facility
Concurrent with the closing of the Offering, on September 28, 2017, the Company entered into the New Term Loan Facility pursuant to a
Second Amendment (“Amendment”) to the Term Loan Credit Agreement dated May 31, 2015, as amended by the First Amendment, dated as of September 27, 2016 (the “TLB Agreement”), among the Company, the several lenders from
time to time parties thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other agents thereto. Pursuant to the Amendment, the TLB Agreement was amended to (a) reduce the amount outstanding under the TLB Agreement to
$350.0 million, (b) reduce the applicable margin for Eurodollar Loans to 2.50% and the applicable margin for ABR Loans to 1.50% (which is a reduction of 1.75% for each type of loan), (c) extend the maturity date of the TLB Agreement
from May 31, 2021 to September 28, 2024 and (d) make certain other changes to the TLB Agreement.
A copy of the New Term
Loan Facility is filed as Exhibit 10.1 to this Report and incorporated herein by reference thereto. The foregoing summary of the amendments to the TLB Agreement pursuant to the Amendment does not purport to be complete and is qualified in its
entirety by reference to the full text of the TLB Agreement as amended by the Amendment.