Item 1.01 |
Entry Into a Material Definitive Agreement. |
Exchange Offer
As previously announced, on May 14, 2024, Owens Corning, a Delaware corporation (“Owens Corning”), issued a press release announcing the early results of its previously announced offer to exchange (the “Exchange Offer”) any and all 3.50% Senior Notes due 2030 (the “Existing Masonite Notes”) issued by Masonite International Corporation, a British Columbia corporation (“Masonite”), and held by certain eligible holders for up to an equal aggregate principal amount of new 3.50% Senior Notes due 2030 (the “New Owens Corning Notes”) issued by Owens Corning, on the terms and subject to the conditions set forth in Owens Corning’s Offering Memorandum and Consent Solicitation Statement, dated May 1, 2024, as amended (the “Statement”).
On May 22, 2024, Owens Corning accepted the Existing Masonite Notes that had been validly tendered and not validly withdrawn and related consents that had been validly delivered and not validly revoked at 5:00 p.m., New York City time, on May 14, 2024, and consummated the exchange of such Existing Masonite Notes by issuing an equal aggregate principal amount of New Owens Corning Notes and making a cash consent payment to exchanging eligible holders, on the terms and subject to the conditions set forth in the Statement. The Exchange Offer was made in connection with the acquisition of Masonite by MT Acquisition Co ULC, a British Columbia unlimited liability company and a wholly owned subsidiary of Owens Corning, which closed on May 15, 2024.
New Owens Corning Notes
Pursuant to the Exchange Offer, Owens Corning issued approximately $373.2 million in aggregate principal amount of New Owens Corning Notes on May 22, 2024.
The New Owens Corning Notes mature on February 15, 2030 and bear interest at a rate of 3.50% per annum, payable semi-annually on February 15 and August 15 of each year.
The New Owens Corning Notes are general senior unsecured obligations of Owens Corning and rank equally in right of payment with all of Owens Corning’s existing and future senior unsecured indebtedness and rank senior in right of payment to all of its existing and future subordinated indebtedness. The New Owens Corning Notes are effectively subordinated to Owens Corning’s secured indebtedness, to the extent of the value of the collateral securing such indebtedness, and are structurally subordinated to all existing and future obligations of Owens Corning’s subsidiaries.
The New Owens Corning Notes have not been registered under the Securities Act of 1933 (the “Securities Act”), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act.
The terms of the New Owens Corning Notes are governed by the indenture, dated as of June 2, 2009, between Owens Corning, and Computershare Trust Company, N.A., as trustee (the “Trustee”), as supplemented and amended, including by the Thirteenth Supplemental Indenture, dated as of May 22, 2024 (the “Thirteenth Supplemental Indenture”), between Owens Corning and the Trustee (as so supplemented and amended, the “Indenture”). The Indenture contains customary covenants that, among other things, limit Owens Corning’s and its subsidiaries’ ability to create liens on property that secure indebtedness, enter into sale and leaseback transactions and merge, consolidate or amalgamate with another company. Upon the occurrence of a “Change of Control Repurchase Event,” as defined in the Thirteenth Supplemental Indenture, Owens Corning is required to offer to repurchase the New Owens Corning Notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest, if any, to, but excluding, the repurchase date.
Owens Corning may redeem the New Owens Corning Notes, in whole or in part, prior to August 15, 2029, at a make-whole redemption price, and on or after August 15, 2029, at a redemption price equal to 100% of the principal amount thereof, in each case, plus any accrued and unpaid interest to the date of redemption.
The Indenture contains customary events of default, including failure to make required payments, failure to comply with certain agreements or covenants, failure to pay or acceleration of certain other indebtedness and certain events of bankruptcy and insolvency. An event of default under the Indenture will allow either the Trustee or the holders of not less than 25% in aggregate principal amount of the then-outstanding New Owens Corning Notes issued under the Indenture to accelerate, or in certain cases, will automatically cause the acceleration of, the amounts due under the New Owens Corning Notes.
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