UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant |
On May 21, 2025 (the “Closing Date”), pursuant to a purchase agreement among Voya Financial, Inc. (the “Company”), Voya Holdings Inc. (the “Subsidiary Guarantor”), TD Securities (USA) LLC and BofA Securities, Inc., as representatives of the several initial purchasers, and Peachtree Corners Funding Trust II, a Delaware statutory trust (the “Trust”), the Trust completed the issuance and sale of 600,000 of its Pre-Capitalized Trust Securities redeemable May 15, 2035 (the “P-Caps”) for an aggregate purchase price of $600,000,000 in a private placement pursuant to Rule 144A under the Securities Act of 1933, as amended. The P-Caps will pay distributions at an annual rate of 6.012%, payable semi-annually. The P-Caps do not carry registration rights and may be held only by qualified institutional buyers, as defined in Rule 144A under the Securities Act of 1933, as amended, that are also “qualified purchasers” for purposes of Section 3(c)(7) of the Investment Company Act of 1940, as amended. The Trust invested the proceeds from the sale of the P-Caps in a portfolio of principal and/or interest strips of U.S. Treasury securities (the “Eligible Assets”). The P-Caps provide the Company with a new source of contingent liquidity, the proceeds of which, if drawn, would be used for general corporate purposes.
On the Closing Date, the Company and the Subsidiary Guarantor entered into a facility agreement (the “Facility Agreement”) with the Trust and U.S. Bank Trust Company, National Association, as notes trustee. The Facility Agreement provides that the Company has the right to require the Trust to purchase, on one or more occasions, from the Company (the “Issuance Right”) the Company’s 6.012% Senior Notes due 2035 (the “Senior Notes”) in an aggregate principal amount at any one time outstanding and held by the Trust of up to $600,000,000 in exchange for a portion of the Eligible Assets that corresponds to the portion of the Issuance Right being exercised at that time. The Company may direct the Trust to grant the right to exercise the Issuance Right with respect to all or a designated amount of the Senior Notes to one or more assignees (who are consolidated subsidiaries of the Company or persons to whom the Company or its consolidated subsidiaries have an obligation), who may cause the Senior Notes to be issued to the Trust and receive the corresponding portion of the Eligible Assets that would otherwise have been delivered to the Company pursuant to the exercise of such Issuance Right. Upon an exercise of the Issuance Right, the Company may in certain circumstances elect to deliver, in lieu of some or all of the Senior Notes, an amount in cash equal to the redemption price of such Senior Notes, plus accrued and unpaid interest on such Senior Notes to, but excluding, the settlement date. In consideration of the Issuance Right, the Company will pay to the Trust a facility premium (the “Facility Premium”) calculated at a rate of 1.5175% per annum on an amount equal to the maximum aggregate principal amount of Senior Notes that it could issue and sell to the Trust, if any, as of the close of business on the business day immediately preceding each May 15 and November 15, commencing on November 15, 2025, to and including May 15, 2035 (or, if any such day is not a business day, the following business day). On the Closing Date, the Company and the Subsidiary Guarantor also entered into a trust expense reimbursement agreement with the Trust (the “Trust Expense Reimbursement Agreement”), pursuant to which the Company agreed to reimburse the Trust for its expenses in connection with the transaction, including trustee’s fees. The Senior Notes, if issued and sold to the Trust, and the Company’s obligations under the Facility Agreement and Trust Expense Reimbursement Agreement are fully, unconditionally and irrevocably guaranteed by the Subsidiary Guarantor.
The Issuance Right will be deemed to be exercised automatically in full (1) if the Company or the Subsidiary Guarantor fails to pay any Facility Premium under the Facility Agreement when due or any amount due and owing under the Trust Expense Reimbursement Agreement or fails to purchase and pay for any Eligible Assets that are due and not paid on their payment date, and such failure is not cured (including payment of any premium as a result of such failure) within 30 days, or (2) upon certain bankruptcy events involving the Company or the Subsidiary Guarantor. The Company will be required to exercise the Issuance Right in full if (a) it reasonably believes that its consolidated stockholders’ equity, determined in accordance with U.S. GAAP but excluding accumulated other comprehensive income (loss) and equity of non-controlling interests, has fallen below $1.5 billion, which amount may be adjusted from time to time upon the occurrence of certain specified events, (b) an event of default under the indenture that governs the Senior Notes has occurred or would have occurred had the Senior Notes been outstanding or (c) certain events relating to the Trust’s status as an “investment company” under the Investment Company Act of 1940, as amended, have occurred. In addition, at any time following exercise of the Issuance Right in whole or in part, other than upon an automatic exercise or a required exercise as described in this paragraph, the Company will have the right to repurchase any or all of the Senior Notes then held by the Trust in exchange for Eligible Assets that entitle the Trust to receive payments of principal and interest in the same amounts that the Trust would have received on the Eligible Assets that it delivered to the Company upon the exercise of the Issuance Right in respect of the Senior Notes to be so repurchased.
The Company has the right to redeem, at its option, outstanding Senior Notes then held by the Trust, in whole or in part. If any Senior Notes are redeemed prior to February 15, 2035, the redemption price will be equal to the greater of (1) 100% of the principal amount of the Senior Notes being redeemed and (2) a make-whole amount, plus in either case, accrued and unpaid interest on such Senior Notes to, but excluding, the redemption date. If any Senior Notes are redeemed on or after February 15, 2035, the redemption price will equal 100% of the principal amount of such Senior Notes being redeemed, plus accrued and unpaid interest on such Senior Notes to, but excluding, the redemption date. If the Company redeems any of the outstanding Senior Notes held by the Trust prior to maturity or elects to deliver cash in lieu of Senior Notes upon a voluntary exercise of the Issuance Right, the Trust will redeem P-Caps having an aggregate initial purchase price equal to the aggregate principal amount of Senior Notes to be contemporaneously redeemed or as to which the Company has elected to deliver cash, at a redemption price equal to the redemption price for such Senior Notes, plus accrued and unpaid interest on such Senior Notes to, but excluding, the date of redemption of such Senior Notes. The outstanding P-Caps will be redeemed mandatorily on May 15, 2035 (or, if such day is not a business day, the following business day), unless redeemed earlier. The Trust may also dissolve upon the occurrence of certain other events.
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.
| Voya Financial, Inc. | ||
| (Registrant) | ||
| By: | /s/ Julie Watson | |
| Name: | Julie Watson | |
| Title: | Vice President, Counsel and Corporate Secretary | |
Dated: May 21, 2025