Kronos Worldwide Inc filed SEC Form 8-K: Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation, Financial Statements and Exhibits
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Item 1.01 Entry into a Material Definitive Agreement.
Private Placement of Additional Notes
On September 15, 2025, Kronos International, Inc. (the “Issuer”), a wholly owned subsidiary of Kronos Worldwide, Inc. (the “Company”), completed the institutional private placement of €75 million in aggregate principal amount of 9.50% senior secured notes due 2029 (the “New Notes”). The New Notes were issued as additional notes to the existing €351,174,000 aggregate principal amount of 9.50% senior secured notes due 2029 that the Issuer issued on February 12, 2024 and July 30, 2024 (the “Existing Notes”). The New Notes were issued pursuant to a third supplemental indenture dated September 15, 2025 (the “Third Supplemental Indenture”) to that certain indenture dated as of February 12, 2024, by and among the Issuer, the Company, the subsidiary guarantors and Deutsche Bank Trust Company Americas, as trustee, collateral agent, paying agent, transfer agent and registrar (the “Base Indenture”), as previously supplemented by the first supplemental indenture dated as of July 30, 2024 (the “First Supplemental Indenture”), and the second supplemental indenture dated as of August 8, 2024 (the “Second Supplemental Indenture” and, together with the Base Indenture, the First Supplemental Indenture and the Third Supplemental Indenture, the “Indenture”). The New Notes were sold to persons reasonably believed to be qualified institutional buyers within the United States in reliance on Rule 144A under the Securities Act or outside the United States to non-U.S. persons in accordance with Regulation S under the Securities Act.
The transaction resulted in net proceeds to the Company of approximately €77.3 million (approximately $90.4 million at current exchange rates), after fees and expenses, which were used to pay amounts due under the Company’s 3.75% Senior Secured Notes due September 15, 2025 at maturity. The Company will use any remaining proceeds for general corporate purposes.
The Existing Notes and the New Notes (collectively, the “Notes”) constitute one series under the Indenture. The New Notes are identical in all respects to the Existing Notes, except that the New Notes were issued on September 15, 2025, at a price of 105.0% of their principal amount. The New Notes issued pursuant to Regulation S will trade separately under a temporary ISIN and Common Code number, and will not be fungible with the Existing Notes, until 40 days after the date hereof.
Interest on the Notes accrues at the rate of 9.50% per annum, which is payable semi-annually in arrears on each March 15 and September 15. The Issuer will make each interest payment to the Holders of record of the Notes at the close of business on the immediately preceding March 1 and September 1. Interest on the New Notes will accrue from September 15, 2025, and the first interest payment date will be March 15, 2026. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months. The Notes will mature on March 15, 2029.
The Indenture contains a number of covenants and restrictions which, among other things, restrict the ability of the Company and its subsidiaries to incur or guarantee debt, incur liens, make dividend payments or other restricted payments, enter into transactions with affiliates, or merge or consolidate with, or sell or transfer all or substantially all of their respective assets to, another entity. These covenants are subject to a number of important qualifications and exceptions. Further, during any such time when the Notes are rated investment grade by each of Moody’s Investors Service, Inc. and Standard & Poor’s and no Default (as defined in the Indenture) has occurred and is continuing, certain of the covenants will be suspended with respect to the Notes.
At the Company’s option, prior to March 15, 2026, some or all of the Notes may be redeemed at a price equal to 100% of the principal amount thereof, plus a “make-whole” premium (as defined in the Indenture), plus accrued and unpaid interest. At the Company’s option, the Notes may be redeemed on or after March 15, 2026 at redemption prices ranging from 104.750% of the principal amount, declining to 100% on or after March 15, 2028, plus accrued and unpaid interest. In addition, on or before March 15, 2026, the Company may redeem up to 40% of the Notes with the net proceeds of certain public or private equity offerings at 109.50% of the principal amount, plus accrued and unpaid interest, provided that following the redemption at least 50% of the sum of the Notes that were originally issued under the Base Indenture plus any notes issued after the date of the Base Indenture remain outstanding. If the Company or its subsidiaries experience certain change of control events, as outlined in the Indenture, the Issuer would be required to make an offer to purchase the Notes at 101% of the principal amount thereof, plus accrued and unpaid interest. The Company would also be required to make an offer to purchase a specified portion of the Notes at par value in the event the registrant and its subsidiaries generate a certain amount of net proceeds from the sale of assets outside the ordinary course of business, and such net proceeds are not otherwise used for specified purposes within a specified time period.
The Notes are fully and unconditionally guaranteed, jointly and severally, on a senior secured basis by the Company and each of its direct and indirect domestic, wholly-owned subsidiaries (other than the Issuer), subject to certain exceptions. The Notes and the related guarantees are secured on a first priority basis by (i) 100% of the common stock or other ownership interests of each existing and future direct domestic subsidiary of the Issuer or any guarantor and (ii) 65% of the voting common stock or other ownership interests and 100% of the non-voting common stock or other ownership interests of each foreign subsidiary that is directly owned by the Issuer or any guarantor.
For a further description of the terms of the Indenture and the Notes, see the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission on February 12, 2024 and July 30, 2024. The description of the Indenture contained
herein and therein does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full text of the Indenture.
Item 2.03 | Creation of Direct Financial Obligation or an Obligation under and Off-Balance Sheet Arrangement of a Registrant. |
The disclosure set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
Item 9.01Financial Statements and Exhibits
(d)Exhibits
10.1 |
10.2 |
104Cover Page Interactive Data File (embedded within Inline XBRL document).
SIGNATURE
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.
KRONOS WORLDWIDE, INC. | ||
(Registrant) | ||
Date: September 15, 2025 | By: | /s/ Bradley E. Troutman |
Bradley E. Troutman, | ||
Senior Vice President and Chief Financial Officer | ||