Item 1.01.
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Entry into a Material Definitive Agreement.
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On January 22, 2019, Vistra Operations Company LLC, a Delaware limited liability company (Vistra Operations) and an indirect,
wholly owned subsidiary of Vistra Energy Corp., a Delaware corporation (the Company), entered into a purchase agreement (the Purchase Agreement) by and among Vistra Operations, certain subsidiaries of the Company (the
Subsidiary Guarantors), and J.P. Morgan Securities LLC as representative of the several initial purchasers named in Schedule I thereto (the Initial Purchasers). The Purchase Agreement provides for the offer and sale (the
Offering) by Vistra Operations, and the purchase by the Initial Purchasers, of $1,300,000,000 aggregate principal amount of Vistra Operations 5.625% senior notes due 2027 (the Notes).
The Offering is expected to close on or about February 6, 2019, subject to customary closing conditions. The sale of the Notes will not be not
registered under the Securities Act of 1933, as amended (the Securities Act), and the Notes will be sold on a private placement basis to persons reasonably believed to be qualified institutional buyers under Rule 144A under the
Securities Act and outside the United States to
non-U.S.
persons in compliance with Regulation S under the Securities Act.
The Purchase Agreement contains customary representations, warranties, covenants and agreements by Vistra Operations, the Subsidiary
Guarantors and the Initial Purchasers, including indemnification for certain liabilities under the Securities Act, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the Purchase
Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties.
The foregoing is only a brief description of the material terms of the Purchase Agreement and does not purport to be a complete description of
the rights and obligations of the parties thereunder. Such description is qualified in its entirety by reference to the Purchase Agreement, which is attached to this Current Report on Form
8-K
as Exhibit 10.1
and is incorporated by reference into this Item 1.01.
The Company intends to use the net proceeds from the Offering to fund a cash tender
offer (the Tender Offer) to purchase for cash its outstanding 7.375% Senior Notes due 2022 (the Notes) for a maximum aggregate purchase price (excluding accrued and unpaid interest) of up to $1,275,000,000, and pay any
related fees and expenses thereof, and for general corporate purposes. The Company has retained one of the Initial Purchasers to act as lead dealer manager in connection with the Tender Offer and has agreed to reimburse it for its reasonable
out-of-pocket
expenses.
Additionally, affiliates of the Initial
Purchasers are lenders under that certain credit agreement, dated October 3, 2016, by and among Vistra Operations, as borrower, the guarantors party thereto, the various lenders party, and Credit Suisse AG, Cayman Islands Brach, as
administrative agent and collateral agent (as amended, the Credit Agreement), and will receive a portion of the net proceeds from the Offering to the extent such proceeds are used to repay borrowings under the Credit Agreement. Further,
the Initial Purchasers and their affiliates have performed commercial banking, investment banking and advisory services for the Company and Vistra Operations from time to time for which they have received customary fees and reimbursement of
expenses. The Initial Purchasers or their affiliates may, from time to time, engage in transactions with and perform services for the Company and Vistra Operations in the ordinary course of their business for which they may receive customary fees
and reimbursement of expenses.