Irinquiries@prestigebrands.com
Prestige Consumer Healthcare Inc.
660 White Plains Road – Ste 250
Tarrytown, NY 10591
Telephone: 914-524-6819
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
_____________
FORM
8-K
_____________
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
report (Date of earliest event reported): March 24, 2010
PRESTIGE
BRANDS HOLDINGS, INC.
(Exact
Name of Registrant as Specified in Charter)
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Delaware
(State
or Other Jurisdiction
of
Incorporation)
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001-32433
(Commission
File Number)
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20-1297589
(IRS
Employer Identification No.)
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90 North
Broadway, Irvington, New York 10533
(Address
of Principal Executive Offices)
(914)
524-6810
(Registrant’s
telephone number, including area code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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£
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Written
communications pursuant to Rule 425 under the Securities
Act.
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£
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Soliciting
material pursuant to Rule 14a-12 under the Exchange
Act.
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£
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Pre-commencement
communications pursuant to Rule 14d-2b under the Exchange
Act.
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£
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act.
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Item
1.01 Entry into a Material Definitive
Agreement.
Indenture
On March 24, 2010, Prestige Brands
Holdings, Inc. (the “Company”), its wholly-owned subsidiary Prestige Brands,
Inc. (“Prestige Brands”), and certain subsidiaries of the Company (together with
the Company, the “Guarantors”) entered into an indenture (the “Indenture”) with
U.S. Bank National Association, as trustee, relating to the issuance by Prestige
Brands of $150 million aggregate principal amount of 8¼% senior notes due 2018
(the “New Notes”). The New Notes were sold in a private placement
transaction pursuant to Rule 144A and Regulation S under the Securities Act of
1933, as amended.
The terms of the New Notes are governed
by the Indenture. The New Notes were issued at a discount of 1.436%
for gross proceeds of approximately $147,846,000 and bear a stated interest rate
of 8¼% per annum, payable semi-annually on April 1 and October 1 of each year,
beginning on October 1, 2010. The New Notes mature on April 1,
2018. The New Notes are senior unsecured obligations of Prestige
Brands and are guaranteed on a senior unsecured basis by the
Guarantors. The New Notes are effectively junior in right of payment
to all existing and future secured obligations of Prestige Brands and the
Guarantors, equal in right of payment with all existing and future senior
unsecured indebtedness of Prestige Brands and the Guarantors, and senior in
right of payment to all future subordinated debt of Prestige Brands and the
Guarantors.
At any
time prior to April 1, 2014, Prestige Brands may redeem the New Notes in whole
or in part at a redemption price equal to 100% of the principal amount of the
notes redeemed, plus a “make-whole premium” calculated as set forth in the
Indenture, together with accrued and unpaid interest, if any, to the date of
redemption. Prestige Brands may redeem the New Notes in whole or in
part at any time on or after the 12-month period beginning April 1, 2014 at a
redemption price of 104.125% of the principal amount thereof, at a redemption
price of 102.063% of the principal amount thereof if the redemption occurs
during the 12-month period beginning on April 1, 2015, and at a redemption price
of 100% of the principal amount thereof on and after April 1, 2016, in each
case, plus accrued and unpaid interest, if any, to the redemption
date. In addition, on or prior to April 1, 2013, with the net cash
proceeds from certain equity offerings, Prestige Brands may redeem up to 35% in
aggregate principal amount of the New Notes at a redemption price of 108.250% of
the principal amount of the New Notes to be redeemed, plus accrued and unpaid
interest to the redemption date.
Within 30
days of the occurrence of a change of control triggering event, as defined in,
and subject to the exceptions in, the Indenture, Prestige Brands shall make a
change of control offer to each holder of New Notes. The holders of
the New Notes will have the right to accept the offer and require Prestige
Brands to repurchase all or any portion of such holder’s New Notes at a
redemption price of 101% of the principal amount thereof, plus any accrued and
unpaid interest to the repurchase date.
The
Indenture contains certain covenants that will limit, among other things, the
ability of Prestige Brands and the Guarantors to:
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incur
additional indebtedness;
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pay
dividends or make other restricted
payments;
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make
certain investments;
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create
or permit certain liens;
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sell
assets;
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create
or permit restrictions on the ability of their restricted subsidiaries to
pay dividends or other
distributions;
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engage
in transactions with affiliates;
and
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consolidate
or merge with or into other companies or sell all or substantially all of
their assets.
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The
Indenture contains customary events of default, including:
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Failure
to make required payments;
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Failure
to comply with certain agreements or
covenants;
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Failure
to pay, or acceleration of, certain other material
indebtedness;
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Failure
to pay certain judgments; and
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Certain
events of bankruptcy and
insolvency.
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An event
of default under the Indenture will allow either the trustee or the holders of
at least 25% in principal amount of the then-outstanding New Notes to
accelerate, or in certain cases, will automatically cause the acceleration of,
the amounts due under the New Notes.
Prestige
Brands used $147,846,000 of net proceeds from the sale of the New Notes combined
with other available funds to fund the purchase of the outstanding 9¼% senior
subordinated notes due 2012 (the “Old Notes”) and certain costs relating to the
early settlement of Prestige Brand’s cash tender offer and consent solicitation
with respect to $97,913,000 in aggregate principal amount of the Old Notes and
to retire its existing credit agreement. Accrued interest on the tendered Old
Notes was also paid.
The
foregoing summary of the material terms of the New Notes and the Indenture does
not purport to be complete and is qualified in its entirety by reference to the
Indenture (including the form of New Notes attached thereto), copies of which
will be filed as exhibits to the Company’s Annual Report on Form 10-K for the
fiscal year ending March 31, 2010.
Registration
Rights Agreement
In
connection with the issuance of the New Notes, Prestige Brands, the Guarantors
and the initial purchasers for the New Notes entered into a registration rights
agreement dated March 24, 2010 (the “Registration Rights
Agreement”). Under the Registration Rights Agreement, Prestige Brands
and the Guarantors agree, among other things, to use their commercially
reasonable efforts to file and cause to become effective an exchange offer
registration statement with the Securities and Exchange Commission (“SEC”) with
respect to a registered offer (the
3
The
foregoing summary of the material terms of the Registration Rights Agreement
does not purport to be complete and is qualified in its entirety by reference to
the Registration Rights Agreement, a copy of which will be filed as an exhibit
to the Company’s Annual Report on Form 10-K for the fiscal year ending March 31,
2010.
Fourth
Supplemental Indenture
On March
24, 2010, Prestige Brands, the Guarantors, and U.S. Bank National Association,
as trustee, executed a fourth supplemental indenture (the “Fourth Supplemental
Indenture”) supplementing and amending the indenture governing the Old Notes,
dated as of April 6, 2004 (as supplemented and amended, including as
supplemented and amended by the Fourth Supplemental Indenture, the “Old Notes
Indenture”). The execution of the Fourth Supplemental Indenture was
accomplished as a result of the receipt of tenders and related consents from the
holders of at least a majority in principal amount of the Old Notes in response
to Prestige Brands’ previously announced tender offer and consent solicitation
(the “Tender Offer and Consent Solicitation”).
The
Fourth Supplemental Indenture amends the Old Notes Indenture to, among other
modifications, eliminate substantially all of the restrictive covenants and
certain events of default contained therein, and to make conforming changes to
the Old Notes Indenture. In addition, the Fourth Supplemental
Indenture also amends the Old Notes Indenture to reduce the minimum redemption
notice period from 30 days to at least three days prior to a redemption
date. Any Old Notes tendered on or before 5:00 p.m., New York City
time, on March 23, 2010, that were not validly withdrawn before such time can
not be withdrawn, nor can any Old Notes tendered after such time be withdrawn
after April 6, unless in either case the Company is otherwise required by
applicable law to permit the withdrawal.
The
foregoing summary of the material terms of the Fourth Supplemental Indenture
does not purport to be complete and is qualified in its entirety by reference to
the Fourth Supplemental Indenture, a copy of which will be filed as an exhibit
to the Company’s Annual Report on Form 10-K for the fiscal year ending March 31,
2010.
4
Credit
Agreement
On March
24, 2010, the Company and Prestige Brands (the “Borrower”) entered into a credit
agreement (the “Credit Agreement”) with Bank of America, N.A., as administrative
agent, Deutsche Bank Securities Inc., as syndication agent, and a syndicate of
financial institutions and institutional lenders.
The
Credit Agreement provides for:
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A
senior secured term loan facility in an aggregate principal amount of $150
million; and
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A
non-amortizing senior secured revolving credit facility in an aggregate
principal amount of up to $30 million (a portion of this facility is
available for swing loans and for the issuance of letters of
credit).
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A portion
of the net proceeds of the Credit Agreement, along with cash on hand and the
proceeds of the offering of the New Notes, were used (and in the case of certain
Old Notes, will be used) to purchase, redeem or otherwise retire all of the Old
Notes and to repay all amounts under our former credit facility and terminate
the associated credit agreement. The revolving credit facility will
also be used for working capital and general corporate needs.
Uncommitted Incremental Increases.
The Borrower has the right to increase the commitments under the Credit
Agreement by up to $200 million, provided certain conditions are
met. None of the lenders under the Borrower’s Credit Agreement has
committed or is obligated to provide any such increase in the
commitments.
Collateral and Guarantees.
All obligations of the Borrower under the Credit Agreement and any
exposure in respect of secured cash management transactions incurred on behalf
of the Borrower or any other loan party, or under any secured interest rate
agreement or other secured hedging arrangements entered into with any of the
lenders, is unconditionally guaranteed by the Guarantors, including the Company,
and, under certain limited circumstances, certain of the Company’s future
foreign subsidiaries.
Except as
provided below, the obligations under the Credit Agreement are secured by a
first-priority security interest in substantially all of the assets of the
Borrower and each Guarantor, including but not limited to:
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A
perfected, first-priority pledge of all of the capital stock held by the
Borrower or any Guarantor, except for 35% of the voting stock of certain
non-U.S. subsidiaries, to the extent that such pledge would result in
adverse tax consequences to the Borrower or a Guarantor,
and
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Perfected
first-priority security interests in substantially all other tangible and
intangible assets of the Borrower and the
Guarantors.
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Interest and Fees. All loans
will bear interest, at the option of the Borrower, at one of the following
rates:
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Base Rate Loans. (1) at
a rate per annum equal at all times to the highest of (a) Bank of America
N.A.’s “prime rate”; (b) 0.50% per annum plus the Federal Funds Rate; and
(c) the Eurodollar Rate for an interest period of one month plus 1.00%
plus (2) the
applicable margin then in effect.
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Eurodollar Rate Loans.
(1) at a rate per annum equal to the sum of (a) the Eurodollar Rate
determined for the applicable interest period and (b) the applicable
margin then in effect.
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Default Interest. During the
continuance of a material event of default or, upon (i) receipt by the Borrower
of a notice from the administrative agent or (ii) receipt by the administrative
agent of a notice from the requisite lenders, during the continuance of any
other event of default, loans shall bear interest at an additional 2% per
annum.
Unused Commitment Fee. An
unused commitment fee equal to 0.50% per annum of the daily average unused
portion of the revolving credit facility will accrue, payable quarterly in
arrears and at maturity of the revolving credit facility.
Repayment; Prepayments. The
term loan facility will mature on March 24, 2016. Each loan
thereunder will amortize during the period such loan is outstanding in quarterly
installments that shall each be equal to 0.25% of the initial principal amount
of the loans made under the term loan facility with the balance of such loan
payable on the maturity date.
The
revolving credit facility will mature, and the revolving credit commitments
relating thereto will terminate, on March 24, 2015.
Optional
prepayments of borrowings under the Credit Agreement, and optional reductions of
the unutilized portion of the revolving credit facility commitments, will be
permitted at any time, in minimum principal amounts, without premium or penalty,
subject to reimbursement of the lenders’ redeployment costs in the case of a
prepayment of Eurodollar Rate borrowings other than a prepayment made on the
last day of the relevant interest period.
Mandatory Prepayments. The
Credit Agreement requires, subject to certain exceptions, prepayments from
excess cash flow, and from the proceeds of certain asset sales, issuances of
debt, and insurance.
Certain Covenants. The Credit
Agreement requires the Borrower to meet certain financial tests, including
without limitation, a maximum leverage ratio, a minimum interest coverage ratio
and a maximum capital expenditures covenant. In addition, the Credit
Agreement contains certain representations and warranties and affirmative and
negative covenants which, among other things, limit the incurrence of additional
indebtedness, guarantees, investments, distributions, transaction with
affiliates, asset sales, acquisitions, capital expenditures, mergers and
consolidations, prepayment of other indebtedness, liens and encumbrances and
other matters customarily restricted in such agreements.
Events of Default. The Credit
Agreement contains customary events of default, including, without limitation,
payment defaults, breaches of representations and warranties, covenant defaults,
cross-defaults to certain other indebtedness in excess of specified amounts,
certain
6
The
foregoing summary of the material terms of the Credit Agreement does not purport
to be complete and is qualified in its entirety by reference to the Credit
Agreement, a copy of which will be filed as an exhibit to the Company’s Annual
Report on Form 10-K for the fiscal year ending March 31, 2010.
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Item
1.02.
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Termination
of a Material Definitive Agreement.
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On March 24, 2010, upon completion of
the Company’s refinancing of its existing indebtedness, as described in Item
1.01 above, the Credit Agreement, dated as of April 6, 2004, as amended (the
“Existing Credit Agreement”), among Prestige Brands, Prestige Brands
International, LLC, the lenders and issuers parties thereto, Citicorp North
America, Inc., as administrative and collateral agent, Bank of America, N.A., as
syndication agent, and Merrill Lynch Capital, a division of Merrill Lynch
Business Financial Services Inc., as documentation agent, together with the
related agreements executed in connection with the Existing Credit Agreement,
were terminated. In addition, on March 24, 2010, Prestige Brands
issued a Notice of Redemption for the remaining outstanding Old Notes, which
Prestige Brands expects to redeem on April 15, 2010. Upon
consummation of the redemption of the Old Notes outstanding on April 15, 2010,
the Old Notes Indenture, together with the related agreements executed in
connection with the Old Notes Indenture, will terminate.
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Item
2.03.
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Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
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The information included in Item 1.01
of this Report is incorporated by reference into this Item 2.03.
| Item 3.03. | Material Modifications to Rights of Security Holders. |
The information contained in Item 1.01
of this Report under the heading “Fourth Supplemental Indenture” is incorporated
by reference into this Item 3.03.
| Item 7.01 | Regulation FD Disclosure. |
Refinancing
Press Release
On March 24, 2010, the Company
announced via press release that Prestige Brands, Inc., a wholly-owned
subsidiary of the Company, had completed its offering of the New Notes and the
early settlement of its previously announced cash tender offer and consent
solicitation with respect to the Old Notes. A copy of the press
release is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
7
DenTek
Oral Care, Inc. Litigation
Reference
is made to part II, Item 1 of the Company’s Quarterly Report on Form10-Q for the
quarterly period ended December 31, 2009 and filed with the Commission on
February 9, 2010, which is incorporated herein by this reference.
On March
25, 2010, Medtech Products Inc. (“Medtech”), a wholly-owned subsidiary of the
Company and plaintiff in the pending law suit against DenTek Oral Care, Inc.
(“DenTek”) and others in the U.S. District Court for the Southern District of
New York, settled all of the claims and counterclaims involving DenTek in the
law suit on terms mutually agreeable to Medtech and DenTek. No payment by
Medtech or the Company is required as part of the settlement.
| Item 9.01. | Financial Statements and Exhibits. |
(d) See Exhibit Index immediately
following the signature page to this report, which is incorporated herein by
this reference.
8
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
| PRESTIGE BRANDS HOLDINGS, INC. | |||
| Date: March 30, 2010 | |||
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By:
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/s/ Peter J. Anderson | |
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Name: Peter
J. Anderson
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Title: Chief
Financial Officer
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9
EXHIBIT
INDEX
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Exhibit Number
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Description
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99.1
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Press
Release dated March 24, 2010, announcing the completion of the previously
announced private placement offering by Prestige Brands, Inc. and the
early settlement of the previously announced cash tender offer and consent
solicitation by Prestige Brands,
Inc.
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10
Exhibit 99.1
News
Release
Prestige
Brands, Inc. Announces Closing of Notes Offering
IRVINGTON,
N.Y., March 24, 2010 -- Prestige Brands Holdings, Inc. (NYSE: PBH) (the
“Company”) announced today that its wholly-owned subsidiary Prestige Brands,
Inc. (“Prestige Brands”) has completed its offering of $150 million aggregate
principal amount of its new 8 ¼% Senior Notes due 2018 (the “New Notes”) and the
early settlement of its previously announced cash tender offer and consent
solicitation (the “Tender Offer”) with respect to its outstanding 9 ¼% Senior
Subordinated Notes due 2012 (the “Old Notes”). The New Notes were
privately offered to qualified institutional buyers pursuant to Rule 144A and
Regulations S under the Securities Act of 1933, as amended.
Prestige
Brands used the net proceeds from the sale of the New Notes, together with other
available funds, to fund the purchase of the Old Notes and the related costs to
be incurred in connection with the Tender Offer. As of 5:00 p.m., New
York City time, on March 23, 2010 (the “Consent Payment Deadline”), $97,913,000
aggregate principal amount of Old Notes had been validly tendered and not
withdrawn, which represented 77.71% of the outstanding aggregate principal
amount of the Old Notes. On March 24, 2010, Prestige Brands accepted
for purchase and payment the Old Notes that had been validly tendered at or
prior to the Consent Payment Deadline. Holders of Old Notes who
tendered their Old Notes at or prior to the Consent Payment Deadline received
$1,005.00 for each $1,000 principal amount of the Old Notes validly tendered
(which included the consent payment of $30.00 per $1,000 principal amount of Old
Notes), plus any accrued and unpaid interest on the Old Notes up to, but not
including, March 24, 2010.
In
conjunction with the Tender Offer, Prestige Brands solicited consents to adopt
proposed amendments to the indenture, dated as of April 6, 2004, under which the
Old Notes were issued (as supplemented, the “Indenture”), that, among other
things, eliminated substantially all of the restrictive covenants and certain
events of default in the Indenture, and shortened the minimum notice period for
a redemption from 30 days to three business days. As of the Consent
Payment Deadline, consents from holders of 77.71% had been received and not
withdrawn, representing a sufficient amount to approve the proposed amendments,
and on March 24, 2010, a supplement to the Indenture was executed effecting the
proposed amendments.
Those
holders who did not tender their Old Notes or respond to the consent
solicitation by the Consent Payment Deadline are entitled to do so at or prior
to 11:59 p.m., New York City time, on April 6, 2010 (the “Expiration
Date”). The Expiration Date marks the expiration of the Tender
Offer. However, holders who respond to the Tender Offer after the
Consent Payment Deadline but on or prior to the Expiration Date will not receive
the consent payment of $30.00 per $1,000 principal amount of Old Notes, and will
only be eligible to receive $975.00 per $1,000 principal amount of Old Notes
tendered. Holders who validly tender their Old Notes will also
receive accrued and unpaid interest on the Old Notes up to, but not including,
the date of payment for the Old Notes tendered on or prior to the Expiration
Date.
Prestige
Brands has engaged BofA Merrill Lynch as Dealer Manager and Solicitation Agent
for the Tender Offer. Persons with questions regarding the Tender Offer should
contact BofA Merrill
Lynch at
(888) 292-0070 (toll free) or (980) 388-9217 (collect). Requests for copies of
the Offer to Purchase or other tender offer materials may be directed to D.F.
King & Co., Inc., the Information Agent, at (800) 769-7666 (toll-free) or
(212) 269-5550 (collect), or in writing at 48 Wall Street, 22nd
Floor, New York, NY 10005.
This
announcement does not constitute an offer to purchase the Old Notes or a
solicitation of consents to amend the Indenture. The Tender Offer was
made solely pursuant to the Offer to Purchase and Consent Solicitation
Statement. This announcement does not constitute an offer to sell or
the solicitation of an offer to buy the New Notes. The New Notes have
not been registered under the Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an applicable
exemption from registration requirements.
About
Prestige Brands Holdings, Inc.
The
Company markets and distributes brand name over-the-counter healthcare, personal
care and household products throughout the United States, Canada and certain
international markets. Key brands include Compound W(R) wart
treatments, Chloraseptic(R) sore throat relief and allergy treatment products,
New Skin(R) liquid bandage, Clear Eyes(R) and Murine(R) eye care products,
Little Remedies(R) pediatric over-the-counter healthcare products, The
Doctor’s(R) NightGuard(TM) dental protector, Cutex(R) nail polish remover,
Comet(R) and Spic and Span(R) household cleaners, and other well-known
brands.
SOURCE:
Prestige Brands Holdings, Inc.
Company
Contact: Dean Siegal, (914) 524-6819