(NewsDirect)
Cooper-Standard Holdings Inc. (NYSE:CPS) (“CPS”) today announced that:
- its previouslyannounced Concurrent Notes Offering, Exchange Offer and ConsentSolicitation (each as defined below) each have expired in accordancewith their terms;
- $518,296,700 of New First Lien Notes (asdefined below) were validly subscribed for in the Concurrent NotesOffering, and an additional $61,703,300 of New First Lien Notes willbe issued pursuant to the commitments by the backstop commitmentparties;
- approximately 89.36% of the 2026 Senior Notes (asdefined below) were validly tendered and accepted for exchange by theIssuer (as defined below) in the Exchange Offer;
- theRequisite Consents (as defined below) for the Consent Solicitationhave been received; and
- the Exchange Offer and ConcurrentNotes Offering are expected to settle on or about January 27, 2023(the “Settlement Date”).
CPS’s announcement relates to the previouslyannounced commencement by CPS’s wholly-owned subsidiary,Cooper-Standard Automotive Inc. (the “Issuer”), of certainrefinancing transactions (the “Refinancing Transactions”)including (i) a fully backstopped private offering (the “ConcurrentNotes Offering”) of $580.0 million aggregate principal amount of theIssuer’s newly issued 13.50% Cash Pay / PIK Toggle Senior SecuredFirst Lien Notes due 2027 (the “New First Lien Notes”) to holdersof the Issuer’s existing 5.625% Senior Notes due 2026 (the “2026Senior Notes) or their designees who participated in the ExchangeOffer (as defined herein), (ii) an offer (the “Exchange Offer”) tothe holders of 2026 Senior Notes who participated in the ConcurrentNotes Offering to exchange any and all of the $400.0 million aggregateprincipal amount of 2026 Senior Notes outstanding for the Issuer’snewly issued 5.625% Cash Pay / 10.625% PIK Toggle Senior Secured ThirdLien Notes due 2027 (the “New Third Lien Notes”, and together withthe New First Lien Notes, the “New Notes”) on a par-for-par basisand (iii) a consent solicitation (the “Consent Solicitation”)whereby the Issuer solicited, and holders of 2026 Senior Notes whotendered pursuant to the Exchange Offer were required to deliver,consents to amend the indenture under which the 2026 Senior Notes wereissued (the “2026 Senior Notes Indenture”) to remove substantiallyall of the covenants, certain events of default and certain otherprovisions contained in the 2026 Senior Notes and 2026 Senior NotesIndenture and to release and discharge the guarantee of the 2026Senior Notes by CPS. In order to approve the amendment to the 2026Senior Notes Indenture, consents were required to be delivered and notrevoked in respect of at least a majority of the outstanding principalamount of the 2026 Senior Notes (the “Requisite Consents”). Eachof the Concurrent Notes Offering, the Exchange Offer and the ConsentSolicitation was conducted upon the terms and subject to theconditions set forth in a confidential offering memorandum and consentsolicitation statement, dated December 19, 2022 (as so amended,supplemented, modified and updated, the “OfferingMemorandum”).
The Concurrent Notes Offering, the Exchange Offer and theConsent Solicitation expired one minute past 11:59 PM, New York Citytime, on January 18, 2023 (such time and date, the “ExpirationTime”). As of the Expiration Time, based on information provided byKroll Issuer Services (US) (“Kroll” or the “Exchange andSubscription Agent”), (i) approximately $518,296,700 in aggregateprincipal amount of the New First Lien Notes had been subscribed forand accepted in the Concurrent Notes Offering (excluding theadditional New First Lien Notes to be issued to the backstopcommitment parties), (ii) approximately $357,446,000 in aggregateprincipal amount of the 2026 Senior Notes, representing approximately89.36% of the aggregate outstanding principal amount of the 2026Senior Notes, had been validly tendered and accepted for exchange bythe Issuer in connection with the Exchange Offer, and (iii) theRequisite Consents to effectuate the proposed amendments to the 2026Senior Notes Indenture had been delivered. On the terms and subject tothe conditions set forth in the Offering Memorandum, concurrently withthe settlement of the Concurrent Notes Offering and the ExchangeOffer, the Issuer expects to issue approximately $61,703,300 inaggregate principal amount of additional New First Lien Notes tocertain backstop commitment parties, which New First Lien Notes willbe in addition to the pro rata portion of the New First Lien Notesissued to such parties as part of the Concurrent Notes Offering. As aresult, on the Settlement Date, the Issuer expects to issue $580.0million aggregate principal amount of New First Lien Notes.
On the terms and subjectto the conditions set forth in the Offering Memorandum, as a result ofreceiving the Requisite Consents, on January 20, 2023, the Issuerentered into a supplemental indenture to the 2026 Senior NotesIndenture, effectuating the proposed amendments, which amendments willbecome operative as of the Settlement Date.
The RefinancingTransactions may not be consummated on the terms described in thispress release or at all. The complete terms and conditions of theRefinancing Transactions are set forth in the OfferingMemorandum.
Goldman Sachs & Co. LLC is acting as dealer manager inconnection with the Exchange Offer and as financial advisor to CPS andthe Issuer in connection with the Refinancing Transactions. SimpsonThacher & Bartlett LLP is acting as legal counsel to CPS and theIssuer in connection with the Refinancing Transactions. Houlihan LokeyCapital, Inc. is acting as financial advisor and Willkie Farr &Gallagher LLP as legal advisor to the backstop commitmentparties.
Thiscommunication is for informational purposes only and does notconstitute an offer to sell, or a solicitation of an offer to buy, anysecurity and does not constitute an offer, solicitation or sale of anysecurity in any jurisdiction in which such offer, solicitation or salewould be unlawful.
The Concurrent Notes Offering and the Exchange Offer were made,and the New Notes are being offered and issued, pursuant to anexemption from the registration requirements of the Securities Act of1933, as amended (the “Securities Act”), only (a) in the UnitedStates, to holders of 2026 Senior Notes who are “qualifiedinstitutional buyers” (as defined in Rule 144A under the SecuritiesAct) and (b) outside the United States, to holders of 2026 SeniorNotes who are persons other than U.S. persons.
Forward LookingStatements
This press release includes “forward-looking statements”within the meaning of U.S. federal securities laws, and we intend thatsuch forward-looking statements be subject to the safe harbor createdthereby. Our use of words “estimate,” “expect,”“anticipate,” “project,” “plan,” “intend,”“believe,” “outlook,” “guidance,” “forecast,” orfuture or conditional verbs, such as “will,” “should,”“could,” “would,” or “may,” and variations of such wordsor similar expressions are intended to identify forward-lookingstatements. All forward-looking statements are based upon our currentexpectations and various assumptions. Our expectations, beliefs, andprojections are expressed in good faith and we believe there is areasonable basis for them. However, we cannot assure you that theseexpectations, beliefs and projections will be achieved.Forward-looking statements are not guarantees of future performanceand are subject to significant risks and uncertainties that may causeactual results or achievements to be materially different from thefuture results or achievements expressed or implied by theforward-looking statements. Among other items, such factors mayinclude: our ability to complete the Refinancing Transactions;impacts, including commodity cost increases and disruptions, relatedto the war in Ukraine and the ongoing COVID-19 pandemic; our abilityto offset the adverse impact of higher commodity and other coststhrough negotiations with our customers; the impact, and expectedcontinued impact, of the COVID-19 outbreak on our financial conditionand results of operations; significant risks to our liquiditypresented by the COVID-19 pandemic risk; prolonged or materialcontractions in automotive sales and production volumes; our inabilityto realize sales represented by awarded business; escalating pricingpressures; loss of large customers or significant platforms; ourability to successfully compete in the automotive parts industry;availability and increasing volatility in costs of manufacturedcomponents and raw materials; disruption in our supply base;competitive threats and commercial risks associated with ourdiversification strategy through our Advanced Technology Group;possible variability of our working capital requirements; risksassociated with our international operations, including changes inlaws, regulations, and policies governing the terms of foreign tradesuch as increased trade restrictions and tariffs; foreign currencyexchange rate fluctuations; our ability to control the operations ofour joint ventures for our sole benefit; our substantial amount ofindebtedness and variable rates of interest; our ability to refinanceour indebtedness and obtain adequate financing sources in the future;operating and financial restrictions imposed on us under our debtinstruments; the underfunding of our pension plans; significantchanges in discount rates and the actual return on pension assets;effectiveness of continuous improvement programs and other costsavings plans; manufacturing facility closings or consolidation; ourability to execute new program launches; our ability to meetcustomers’ needs for new and improved products; the possibility thatour acquisitions and divestitures may not be successful; productliability, warranty and recall claims brought against us; laws andregulations, including environmental, health and safety laws andregulations; legal and regulatory proceedings, claims orinvestigations against us; work stoppages or other labor disruptions;the ability of our intellectual property to withstand legalchallenges; cyber-attacks, data privacy concerns, other disruptionsin, or the inability to implement upgrades to, our informationtechnology systems; the possible volatility of our annual effectivetax rate; the possibility of a failure to maintain effective controlsand procedures; the possibility of future impairment charges to ourgoodwill and long-lived assets; our ability to identify, attract,develop and retain a skilled, engaged and diverse workforce; ourability to procure insurance at reasonable rates; and our dependenceon our subsidiaries for cash to satisfy our obligations; and otherrisks and uncertainties, including those detailed from time to time inperiodic reports filed by CPS with the Securities and ExchangeCommission.
Youshould not place undue reliance on these forward-looking statements.Our forward-looking statements speak only as of the date of this pressrelease and we undertake no obligation to publicly update or otherwiserevise any forward-looking statement, whether as a result of newinformation, future events or otherwise, except where we are expresslyrequired to do so by law.
This pressrelease also contains references to estimates and other informationthat are based on industry publications, surveys and forecasts. Thisinformation involves a number of assumptions and limitations, and wehave not independently verified the accuracy or completeness of theinformation.
Contact Details
Contact forMedia:
Chris Andrews
+1 248-596-6217
Contactfor Analysts:
Roger Hendriksen
+1248-596-6465
roger.hendriksen@cooperstandard.com
CompanyWebsite
https://www.cooperstandard.com/
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