Item 1.01 Entry into a Material Definitive Agreement
On November 10, 2009, Service Corporation International ("SCI") issued a
press release that it had completed the public offering of $150,000,000
aggregate principal amount of its 8.00% Senior Notes due 2021 (the "Notes"). In
connection with the offering, SCI entered into an Underwriting Agreement with JP
Morgan Securities Inc., as representative of the underwriters named therein,
dated November 5, 2009 (the "Underwriting Agreement").
SCI registered the sale of the Notes with the Securities and Exchange
Commission (the "SEC") pursuant to an automatic shelf Registration Statement on
Form S-3 (Registration No. 333-162894) filed on November 5, 2009 (the
"Registration Statement"). SCI will use the net proceeds from the offering of
approximately $143.3 million, together with available cash, to fund SCI's
acquisition of Keystone North America Inc. Pending consummation of the Keystone
acquisition, the net proceeds from the Offering will be held in an escrow
account. In the event that the acquisition is not consummated on or prior to
June 30, 2010, SCI will be required to redeem the notes using the escrowed net
proceeds of the offering plus an amount of escrowed cash or treasury securities
such that the escrowed funds are sufficient to fund the redemption, at a
redemption price equal to 101% of the principal amount, plus accrued and unpaid
interest to, but not including, the date of redemption. The notes may also be
redeemed at SCI's option, in whole, but not in part, at any time prior to
June 30, 2010, if, in SCI's sole judgment, the acquisition will not be
consummated by that date.
The terms of the Notes are governed by the Indenture dated as of February 1,
1993 (the "Original Indenture"), between SCI and The Bank of New York Mellon
Trust Company, N.A., as successor trustee to The Bank of New York (the
"Trustee"), as supplemented by the Eighth Supplemental Indenture, dated as of
November 10, 2009 (the "Eighth Supplemental Indenture"; the Original Indenture,
as amended and supplemented by the Eighth Supplemental Indenture, the
"Indenture").
The Notes will mature on November 15, 2021, and interest is payable on the
Notes on each May 15 and November 15, commencing on May 15, 2010. The record
date is May 1 and November 1. SCI may redeem some or all of the Notes at any
time at the "make-whole" redemption prices specified in the Indenture. If SCI
experiences a change of control, as described in the Indenture, each holder of a
Note will have the right to require SCI to repurchase the Note at 101% of the
principal amount thereof, plus accrued and unpaid interest, if any, to the date
of such repurchase.
The Notes will be SCI's general unsecured obligations and will rank equal in
right of payment with all of SCI's other unsubordinated indebtedness and senior
in right of payment to any of SCI's future subordinated indebtedness. The Notes
will be effectively subordinated to all of SCI's existing and future secured
indebtedness to the extent of the collateral securing such indebtedness and to
all indebtedness and other obligations of SCI's subsidiaries, whether secured or
not secured, including subsidiary guarantees of obligations under SCI's amended
and restated senior credit facility.
Under the Indenture, SCI has agreed to certain restrictions on its ability to
create or incur liens and to enter into certain sale/leaseback transactions.
These covenants are subject to important exceptions and qualifications.
The Indenture contains customary events of default. If an event of default
under the Indenture occurs and is continuing, the Trustee or the holders of at
least 25% in principal amount of the outstanding Notes may declare the unpaid
principal of, the optional redemption premium, if any, and accrued and unpaid
interest, if any, on the Notes to be due and payable.
Other material terms of the Notes, the Original Indenture and the Eighth
Supplemental Indenture are described in the prospectus supplement, dated
November 5, 2009, as filed by SCI with the SEC on November 6, 2009. The
foregoing descriptions of the Underwriting Agreement, Original Indenture, the
Eighth Supplemental Indenture and the Notes are qualified in their entirety by
reference to such Underwriting Agreement, Original Indenture and Eighth
Supplemental Indenture (including the form of Note attached thereto), copies of
which are filed herewith as Exhibits 1.1, 4.1 and 4.2, respectively, and are
incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The description contained under Item 1.01 above is incorporated by reference
in its entirety into this Item 2.03.
Item 7.01 Regulation FD Disclosure.
A copy of the press release referenced above is furnished as Exhibit 99.1 to
this Current Report on Form 8-K.
The information in Item 7.01 of this Current Report on Form 8-K shall not be
deemed "filed" for purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or incorporated by reference in any
filing under the Securities Act or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
Add
SCI to Portfolio
Set Alert
Email to a
Friend