Summary
Uber Technologies, Inc. (UBER) filed an 8-K on May 15, 2020, to report on a material agreement: the private offering of $900.0 million aggregate principal amount of 7.500% Senior Notes due 2025. The net proceeds of approximately $892.1 million are intended for working capital and general corporate purposes, including potential strategic transactions and acquisitions. This offering provides Uber with additional liquidity, which is crucial for navigating its operational landscape. The notes are unsecured senior obligations, effectively subordinated to secured debt and structurally subordinated to non-guarantor subsidiaries. The indenture outlines various covenants that restrict the company's and certain subsidiaries' ability to incur liens, take on additional indebtedness, enter into sale-leaseback transactions, or dispose of substantially all assets. These terms are standard for senior notes and aim to protect bondholders.
Key Highlights
- 1Completed a private offering of $900 million in 7.500% Senior Notes due 2025.
- 2Net proceeds of approximately $892.1 million are earmarked for working capital and general corporate purposes, potentially including acquisitions.
- 3The notes are unsecured senior obligations, ranked equally with existing unsecured debt but subordinated to secured debt.
- 4The indenture imposes covenants limiting the company's ability to incur liens, additional indebtedness (for certain subsidiaries), enter into sale-leaseback transactions, and dispose of substantial assets.
- 5Includes provisions for redemption by Uber starting May 15, 2022, or under specific make-whole or change of control circumstances.
- 6The company can redeem up to 40% of notes with proceeds from certain equity offerings before May 15, 2022, at a premium.
- 7Guarantees are in place from Rasier, LLC, and other domestic restricted subsidiaries that are borrowers/guarantors under the Term Loan Agreement.