8-KMaterial AgreementsFinancial EventsExhibits & Filings

TransDigm Group INC 8-K Report, Material Agreement (Mar 7, 2017)

Filed March 7, 2017For Securities:TDG

Summary

TransDigm Group Inc. (TDG), through its wholly-owned subsidiary TransDigm Inc., has issued an additional $300 million aggregate principal amount of 6.500% Senior Subordinated Notes due 2025. These notes are an add-on to the existing notes issued in May 2015, and they will be treated as a single class under the existing indenture. The issuance was conducted via a private offering to qualified institutional buyers and persons outside the United States. The primary purpose of this filing is to report the material definitive agreement related to the issuance of these new notes. The company has also entered into a registration rights agreement, which obligates TransDigm to file for an exchange offer registration statement within 210 days and have it declared effective within 300 days to allow for the exchange of these restricted notes for freely tradable notes. Failure to meet these deadlines could result in additional interest payments.

Key Highlights

  • 1TransDigm issued an additional $300 million of 6.500% Senior Subordinated Notes due 2025.
  • 2The new notes are fungible with the existing $450 million of 6.500% Senior Subordinated Notes due 2025.
  • 3The issuance was conducted as a private placement under Rule 144A and Regulation S.
  • 4A registration rights agreement was executed, requiring an exchange offer for registered notes within specified timelines.
  • 5Failure to complete the exchange offer or register the notes could trigger additional interest payments up to 1.0% per annum.
  • 6The new notes are subordinated debt and are guaranteed on a senior subordinated unsecured basis by the parent company and domestic subsidiaries.
  • 7The indenture includes covenants that restrict the company's ability to incur additional debt, pay dividends, make investments, and engage in certain other transactions.

Frequently Asked Questions

This 8-K filing primarily reports on TransDigm's entry into a material definitive agreement related to the issuance of an additional $300 million of its 6.500% Senior Subordinated Notes due 2025. It also incorporates this information under the section for the creation of a direct financial obligation.

The new notes are an additional issuance under the existing indenture and will be treated as a single class with the initial notes. This means they are fungible and will share the same interest rate, maturity date, and terms, except for initial transfer restrictions and CUSIP numbers until an exchange offer is completed.

The registration rights agreement requires TransDigm to facilitate an exchange offer to convert these privately placed notes into freely tradable, registered notes. There are strict deadlines for filing and effectiveness of registration statements, and failure to comply will result in TransDigm paying additional interest to the noteholders, potentially up to 1.0% per annum.

The Senior Subordinated Notes are subordinated to all of TransDigm's existing and future senior debt. They rank equally with existing and future senior subordinated debt and senior to any future debt that is expressly subordinated to these notes. They are also structurally subordinated to the liabilities of TransDigm's non-guarantor subsidiaries.