|
Item 1.01
|
Entry into a Material Definitive Agreement
|
On August 20, 2021, Midas OpCo Holdings LLC (the “Issuer”),
a subsidiary of Stagwell Inc. (the “Company”), entered into an indenture (the “Indenture”) among the Issuer, each
of the Company’s subsidiaries signatory thereto, as guarantors (the “Guarantors”), and The Bank of New York Mellon Trust
Company, N.A., as trustee, relating to the issuance by the Issuer of 5.625% Senior Notes due 2029 (the “Notes”). The Notes
bear interest at a rate of 5.625% per annum, accruing from August 20, 2021. Interest is payable semiannually in arrears in cash on February
15 and August 15 of each year, beginning on February 15, 2022. The Notes will mature on August 15, 2029, unless earlier redeemed or repurchased.
The Notes are guaranteed on a senior unsecured basis by all of the
Company’s domestic subsidiaries that guarantee the Issuer’s amended and restated $500 million senior secured revolving credit
facility (the “Facility”), except for certain entities that will be added as guarantors of the Notes within 90 days after
the issue date of the Notes. The Notes are senior unsecured obligations of the Issuer and rank (i) equally in right of payment with all
of the Issuer’s or any Guarantor’s existing and future unsubordinated indebtedness, (ii) senior in right of payment to the
Issuer’s or any Guarantor’s existing and future subordinated indebtedness, (iii) effectively subordinated to any of the Issuer’s
or any Guarantor’s existing and future secured indebtedness to the extent of the collateral securing such indebtedness, including
the Facility, and (iv) structurally subordinated to all existing and future liabilities of the Issuer’s subsidiaries that are not
Guarantors.
The Issuer may, at its option, redeem the Notes in whole at any time
or in part from time to time, on and after August 15, 2024 at a redemption price of 102.813% of the principal amount thereof if redeemed
during the twelve-month period beginning on August 15, 2024, at a redemption price of 101.406% of the principal amount thereof if redeemed
during the twelve-month period beginning on August 15, 2025 and at a redemption price of 100.000% of the principal amount thereof if redeemed
on August 15, 2026 and thereafter.
Prior to August 15, 2024, the Issuer may, at its option, redeem some
or all of the Notes at a price equal to 100% of the principal amount of the Notes plus a “make whole” premium (as described
in the Indenture) and accrued and unpaid interest. The Issuer may also redeem, at its option, prior to August 15, 2024, up to 40% of the
Notes with the net proceeds from one or more equity offerings at a redemption price of 105.625% of the principal amount thereof.
If the Issuer experiences certain kinds of changes of control (as defined
in the Indenture), holders of the Notes may require the Issuer to repurchase any Notes held by them at a price equal to 101% of the principal
amount of the Notes plus accrued and unpaid interest. In addition, if the Issuer sells assets under certain circumstances, it must offer
to repurchase the Notes at a price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest.
The Indenture includes covenants that, among other things, restrict
the Issuer’s ability and the ability of its restricted subsidiaries (as defined in the Indenture) to incur or guarantee additional
indebtedness; pay dividends on or redeem or repurchase the capital stock of the Issuer; make certain types of investments; create restrictions
on the payment of dividends or other amounts from the Issuer’s restricted subsidiaries; sell assets; enter into transactions with
affiliates; create liens; enter into sale and leaseback transactions; and consolidate or merge with or into, or sell substantially all
of the Issuer’s assets to, another person. These covenants are subject to a number of important limitations and exceptions. The
Notes are also subject to customary events of default, including cross-payment default and cross-acceleration provisions.
The foregoing description of the Indenture does not purport to be complete
and is qualified in its entirety by reference to the full text of the Indenture, which is filed hereto as Exhibit 4.1 and is incorporated
herein by reference.