Item 1.01.
Entry into a Material Definitive Agreement
.
Underwriting Agreement
On May 7, 2019, OneMain Holdings, Inc. (“OMH,” “we,” “us” or “our”), as a guarantor, entered into an underwriting agreement (the “Underwriting Agreement”) with Springleaf Finance Corporation, an indirect subsidiary of OMH (“SFC”), as the issuer,
and Morgan Stanley & Co. LLC and RBC Capital Markets, LLC, as representatives of the several underwriters named therein (the “Underwriters”), relating to the issuance and sale by SFC of $800.0 million aggregate principal amount of SFC’s 6.625%
Senior Notes due 2028 (the “Notes”) in an underwritten public offering made pursuant to a registration statement and related prospectus supplement filed with the Securities and Exchange Commission (the “SEC”). As further described below, the
offering closed on May 9, 2019.
The Underwriting Agreement includes customary representations, warranties and covenants by each of SFC and OMH. It also provides for customary
indemnification by each of SFC, OMH and the Underwriters against certain liabilities and customary contribution provisions in respect of those liabilities.
The foregoing description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the
Underwriting Agreement, a copy of which is filed as Exhibit 1.1 to this Current Report on Form 8‑K and is incorporated herein by reference.
SFC intends to use the net proceeds from the offering for general corporate purposes, which may include debt repurchases and repayments.
Some of the Underwriters and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the
ordinary course of business with us, our subsidiaries or our affiliates, including SFC. They have received, or may in the future receive, customary fees and commissions for these transactions. Some of the underwriters and their affiliates have
entered into, and may in the future enter into, financing arrangements (including offerings of asset-backed notes) in which they act as initial purchaser or serve as lender to us, our subsidiaries or our affiliates, including SFC.
Supplemental Indenture
On May 9, 2019, SFC issued the Notes under an Indenture, dated as of December 3, 2014 (the “Base Indenture”), with OMH, as guarantor, and Wilmington Trust,
National Association, as trustee (the “Trustee”), as supplemented by an Eighth Supplemental Indenture, dated as of May 9, 2019 (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), among SFC, OMH and the Trustee,
pursuant to which OMH provided a guarantee of the Notes. The Notes were offered pursuant to a Prospectus Supplement, dated May 7, 2019, to the Prospectus, dated November 7, 2017, filed as part of SFC’s Registration Statement on Form S‑3
(Registration No. 333-221391) filed with the SEC. The Notes are guaranteed on an unsecured basis by OMH.
The Notes will mature on January 15, 2028 and bear interest at a rate of 6.625% per annum, payable semiannually in arrears on January 15 and July 15 of each
year, beginning on January 15, 2020. The Notes are SFC’s senior unsecured obligations and rank equally in right of payment to all of its other existing and future unsubordinated indebtedness from time to time outstanding. The Notes are guaranteed
by us and will not be guaranteed by any of SFC’s subsidiaries, including OneMain Financial Holdings, LLC, or any other party. The Notes are effectively subordinated to all of SFC’s secured obligations to the extent of the value of the assets
securing such obligations, structurally subordinated to all existing and future liabilities of our subsidiaries (other than SFC), and rank senior in right of payment to all existing and future subordinated indebtedness of OMH.
The Notes may be redeemed, in whole or in part, at SFC’s option, at any time or from time to time (i) prior to July 15, 2027 (six months prior to the maturity
date of the Notes), at a “make-whole” redemption price specified in the Indenture, and (ii) on and after July 15, 2027 (six months prior to the maturity date of the Notes), at a redemption price equal to 100% of the principal amount of the Notes
being redeemed, in each case plus accrued and unpaid interest on such principal amount to, but not including, the applicable redemption date. The Notes will not have the benefit of any sinking fund.
The Indenture contains covenants that, among other things, limit SFC’s ability to create liens on assets and restrict SFC’s ability to consolidate, merge or
sell its assets. The Indenture also provides for customary events of default (subject in certain cases to customary grace and cure periods),
which include
nonpayment, breach of covenants in the Indenture and certain events of bankruptcy and insolvency. Generally, if an event of default occurs, the Trustee or holders of at least 25% in aggregate principal amount of the then outstanding Notes may
declare the principal amount of all the Notes to be due and payable immediately.
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
Base Indenture and Supplemental Indenture (and form of 6.625% Senior Notes due 2028 included therein as Exhibit A), copies of which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and are incorporated herein by
reference. In connection with the issuance of the Notes, Jack R. Erkilla, Esq., Senior Vice President, Deputy General Counsel and Secretary of SFC, and Sidley Austin LLP provided SFC with the legal opinions filed as Exhibits 5.1 and 5.2,
respectively, to this Current Report on Form 8-K and are incorporated herein by reference.