Article 1.01. The conclusion of an important definitive agreement.
November 16, 2021, MGP Ingredients, Inc.(the "Company"), completed the previously announced private placement of $201,212,500in aggregate principal amount of 1.875% Convertible Senior Notes due 2041 (the "Notes"). The total aggregate principal amount of the Notes includes $26.25 millionaggregate principal amount of Notes purchased by the initial purchasers in the offering pursuant to their exercise in full of their option to purchase additional Notes under the purchase agreement for the offering. The Notes were offered and sold in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The Notes were issued pursuant to an indenture, dated as of November 16, 2021(the "Indenture"), by and among the Company, as issuer, Luxco, Inc., MGPI Processing, Inc.and MGPI of Indiana, LLC, as subsidiary guarantors (collectively, the "Subsidiary Guarantors"), and U.S. Bank National Association, as trustee (the "Trustee"). Under the Indenture, the Notes will bear interest at a rate of 1.875% per year, payable semiannually in arrears on May 15and November 15of each year, beginning on May 15, 2022. Beginning with the six-month interest period commencing on November 15, 2026, the Company will pay contingent interest on the Notes during any six-month interest period if the trading price per $1,000principal amount of the Notes for each of the five trading days immediately preceding the first day of such interest period equals or exceeds $1,200. Any contingent interest payable on the Notes will be in addition to the regular interest payable on the Notes. The Notes will mature on November 15, 2041, unless previously repurchased, redeemed or converted. Notes will be unconditionally guaranteed on a senior unsecured basis by each of the Subsidiary Guarantors. Holders may surrender their Notes for conversion at any time prior to the close of business on the business day immediately preceding the maturity date only if one or more of the following conditions is satisfied: (i) during any calendar quarter commencing after the calendar quarter ending on March 31, 2022(and only during such calendar quarter), if the closing sale price of the Company's common stock for at least 20 trading days (whether or not consecutive) in the period of 30 consecutive trading days ending on, and including, the last trading day of the calendar quarter immediately preceding the calendar quarter in which the conversion occurs is more than 130% of the applicable conversion price of the Notes on each such trading day; (ii) during the five consecutive business day period following any ten consecutive trading day period in which the trading price for the Notes for each such trading day was less than 98% of the product of the closing sale price of the Company's common stock on each such trading day and the applicable conversion rate on each such trading day; (iii) if the Company calls any or all of the Notes for redemption, at any time prior to the close of business on the business day prior to the redemption date; (iv) upon the occurrence of specified corporate events; or (v) during either the period beginning on, and including, July 15, 2026and ending at the close of business on the business day immediately preceding November 20, 2026or the period beginning on, and including, July 15, 2041and ending at the close of business on the business day immediately preceding the maturity date. Upon conversion, the Company will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of the Company's common stock or a combination of cash and shares of the Company's common stock, at its election, in respect of the remainder, if any, of the Company's conversion obligation in excess of the aggregate principal amount of the Notes being converted. The initial conversion rate will be 10.3911 shares of the Company's common stock for each $1,000principal amount of Notes, which represents an initial conversion price of approximately $96.24per share of the Company's common stock. The conversion rate will be subject to adjustment for certain events described in the Indenture, but will not be adjusted for accrued interest. In addition, following certain corporate events that occur prior to November 20, 2026or if the Company delivers a notice of redemption for which the relevant redemption date occurs prior to November 20, 2026, the Company will increase the conversion rate for a holder that elects to convert its Notes in connection with such a corporate event or notice of redemption, as the case may be. The Company may not redeem the Notes prior to November 20, 2024. The Company may redeem for cash all or any portion of the Notes, at its option, (i) on or after November 20, 2024if the closing sale price of the Company's common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of --------------------------------------------------------------------------------
reimbursement and (ii) on or after
Holders have the right to require the Company to repurchase for cash all or part of their Notes on each of
November 15, 2026, November 15, 2031and November 15, 2036at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the relevant repurchase date. In addition, if a fundamental change, as defined in the Indenture, occurs prior to the maturity date, holders may require the Company to repurchase for cash all or part of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The Notes are the Company's senior unsecured obligations and will rank senior in right of payment to any of the Company's indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to any of the Company's unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of the Company's secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (excluding intercompany obligations and liabilities of a type not required to be reflected on a balance sheet of such subsidiaries in accordance with GAAP) of the Company's subsidiaries (other than the Subsidiary Guarantors).
The deed contains the usual conditions and commitments, including those in the event of default occurring and continuing, whether the trustee or the. . .
Article 2.03. Creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a registrant.
See section 1.01, which is incorporated here by reference.
Item 9.01. Financial Statements and Exhibits. (d) Exhibits Exhibit Number Description 4.1* Indenture, dated
November 16, 2021, among the Company, the Subsidiary Guarantorsand U.S. Bank National Association, as trustee. 4.2* Form of 1.875% Convertible Senior Note due 2041
(included as Exhibit A to
Exhibit 4.1 above). 104 The cover page from this Current Report on Form 8-K, formatted in iXBRL (Inline Extensible Business Reporting Language) * Filed herewith
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