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): April 1, 2016

 

 

Power Solutions International, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   000-35944   33-0963637

(State or other jurisdiction of

incorporation or organization)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

201 Mittel Drive, Wood Dale, Illinois 60191

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (630) 350-9400

 

 

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 (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 1.01. Entry into a Material Definitive Agreement.

On April 1, 2016, the Company entered into a second supplemental indenture (the “Supplemental Indenture”) to the indenture (“Indenture”) governing its $55.0 million 5.50% Senior Notes due 2018 (the “Notes”).

The material terms of the Supplemental Indenture include:

Interest Rate . Interest on the Notes has been increased to 6.50% per annum from 5.50% per annum.

Special Mandatory Offer to Purchase . The Special Mandatory Offer to Purchase has been eliminated.

Increase in Permitted Indebtedness. The basket for permitted credit agreement indebtedness has been increased to $145.0 million (from $125.0 million), with such amount reducing to $135.00 million effective February 1, 2017. The $10.0 million general permitted indebtedness basket has been eliminated.

The foregoing description of the Supplemental Indenture is not complete and is qualified in its entirety by reference to the Supplemental Indenture, a copy of which is attached hereto as Exhibit 4.1, and is incorporated herein by reference.

 

Item 7.01. Regulation FD Disclosure.

On April 4, 2016, the Company issued a press release announcing the execution of the Supplemental Indenture, a copy of which is furnished herewith as Exhibit 99.1.

 

Item 9.01. Financial Statements and Exhibits.

 

(d)    Exhibits:
4.1    Second Supplemental Indenture dated as of April 1, 2016 by and among Power Solutions International, Inc., The Bank of New York Mellon, as Trustee, and the Guarantors party thereto.
99.1    Press Release of Power Solutions International, Inc. dated April 4, 2016 (furnished herewith).

 


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.

 

POWER SOLUTIONS INTERNATIONAL, INC.
By:   /s/ Michael P. Lewis
  Michael P. Lewis
  Chief Financial Officer

Dated: April 4, 2016

Exhibit 4.1

SECOND SUPPLEMENTAL INDENTURE

SECOND SUPPLEMENTAL INDENTURE (this “ Second Supplemental Indenture ”), dated as of April 1, 2016 among Power Solutions International, Inc., a Delaware corporation (the “ Company ”), the Guarantors party thereto (the “ Guarantors ”), and The Bank of New York Mellon, as trustee (the “ Trustee ”) under the Indenture, dated as of April 29, 2015, among the Company, the Guarantors party thereto, and the Trustee (as amended, supplemented or otherwise modified from time to time, the “ Indenture ”).

W I T N E S S E T H

WHEREAS, the Company and the Guarantors have heretofore executed and delivered the Indenture providing for the issuance by the Company of its 5.50% Senior Notes due 2018 (the “ Securities ”);

WHEREAS, the Company and the Guarantors desire to execute and deliver an amendment to certain provisions of the Indenture, including an amendment to increase the interest rate on the Securities from 5.50% per annum to 6.50% per annum;

WHEREAS, the Company has solicited the Holders to direct the Trustee to execute and deliver a supplemental indenture to the Indenture to effect the amendments to the Indenture contemplated hereby;

WHEREAS, pursuant to Section 9.02 of the Indenture, the parties hereto are authorized to execute and deliver this Second Supplemental Indenture to amend the Indenture with the consent of the Holders of at least a majority in principal amount of the Securities Outstanding;

WHEREAS, consents have been received from Holders of all the Securities Outstanding; and

WHEREAS, all Holders are entitled to receive a consent fee of $5.00 per $1,000 principal amount of Securities held (the “ Consent Fee ”) payable upon execution of this Second Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the Company, the Guarantors and the Trustee mutually covenant and agree as follows for the equal and ratable benefit of the Holders as follows:

ARTICLE ONE

DEFINITIONS

Section 1.1 Defined Terms . Capitalized terms used herein without definition shall have the meanings ascribed to them in the Indenture. The words “ herein ,” “ hereof ” and “ hereby ” and other words of similar import used in this Second Supplemental Indenture refer to this Second Supplemental Indenture as a whole and not to any particular section hereof.

ARTICLE TWO

AMENDMENTS TO THE INDENTURE

Section 2.1 Credit Facility Basket . Clause (b)(i) of Section 10.08 of the Indenture is amended to replace clause (x) in its entirety with the words “(x) $145.0 million (such amount reducing to $135.0 million effective February 1, 2017) and”.


Section 2.2 Outstanding Indebtedness Basket . Clause (b)(v) of Section 10.08 of the Indenture is amended and restated in its entirety as follows: “Indebtedness of the Company and the Restricted Subsidiaries outstanding at the date of the Second Supplemental Indenture (other than Indebtedness described in clauses (i) and (ii) of this definition);”.

Section 2.3 No General Indebtedness Basket . Section 10.08 of the Indenture is amended by deleting clause (b)(xvi) in its entirety. The semicolon at the end of clause (b)(xv) of Section 10.08 shall be replaced with a period and the word “and” shall be added to the end of clause (b)(xiv).

Section 2.4 No Special Mandatory Offer to Purchase. Section 11.01 of the Indenture is amended by deleting clause (d) in its entirety. Section 10.14 of the Indenture is amended by deleting the text in its entirety and replacing it with “[Reserved]”. The reverse of the form of Security is amended by deleting the paragraph referencing the Special Mandatory Offer to Purchase. Section 1.02 is amended by removing all definitions and references related to the Special Mandatory Offer to Purchase. The sixth paragraph of Section 3.01 is amended by deleting the words “or pursuant to a Special Mandatory Offer to Purchase as provided in Section   10.14”.

Section 2.5 Change in Coupon . Effective on April 1, 2016, all references in the Indenture and Securities to “5.50%” shall be amended to read “6.50%”. For purposes of clarity, interest due on May 1, 2016 shall be paid at the rate of 5.50% for the months of November 2015 through March 2016, and at the rate of 6.50% for the month of April 2016, assuming 30 day months for all purposes of calculation. Interest payable for each interest period after May 1, 2016, shall be payable at the rate of 6.50%.

ARTICLE 3

MISCELLANEOUS

Section 3.1 Effectiveness . This Second Supplemental Indenture shall become binding upon execution and effective upon the payment of the Consent Fee. Upon execution and delivery of this Second Supplemental Indenture, the Indenture shall be modified, amended and supplemented in accordance with this Second Supplemental Indenture, and all the terms and conditions of both shall be read together as though they constitute one instrument, except that, in the case of conflict, the provisions of this Second Supplemental Indenture will control. In the case of a conflict between the terms and conditions contained in the Securities and those contained in the Indenture, as modified, amended and supplemented by this Second Supplemental Indenture, the provisions of the Indenture, as modified, amended and supplemented by this Second Supplemental Indenture, shall control.

Section 3.2 Ratification of Indenture; Supplemental Indentures Part of Indenture . Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Second Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

Section 3.3 Severability . In case any provision in this Second Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and such provision shall be ineffective only to the extent of such invalidity, illegality or unenforceability.

Section 3.4 Governing Law . THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SECOND SUPPLEMENTAL INDENTURE.

 

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Section 3.5 Waiver of Jury Trial . EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS SECOND SUPPLEMENTAL INDENTURE, THE INDENTURE, THE SECURITIES, THE GUARANTEES OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 3.6 Counterparts . The parties may sign any number of copies of this Second Supplemental Indenture (including by electronic transmission). Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Second Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Second Supplemental Indenture as to the parties hereto and may be used in lieu of any original Second Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

Section 3.7 Effect of Headings . The Section headings herein are for convenience only and shall not affect the construction hereof.

Section 3.8 Trustee . The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Second Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guarantors and the Company.

[SIGNATURE PAGES FOLLOW]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed and attested, all as of the date first above written.

 

The Company and the Guarantors:
P OWER S OLUTIONS I NTERNATIONAL , I NC .
T HE W G ROUP , I NC .
P OWER S OLUTIONS , I NC .
P ROFESSIONAL P OWER P RODUCTS , I NC .
P OWER G REAT L AKES , I NC .
A UTO M ANUFACTURING , I NC .
T ORQUE P OWER S OURCE P ARTS , I NC .
P OWER P RODUCTION , I NC .
P OWER G LOBAL S OLUTIONS , I NC .
PSI I NTERNATIONAL , LLC
XIS YNC LLC
P OWER P ROPERTIES , L.L.C.
P OWERTRAIN I NTEGRATION A CQUISITION , LLC
B I -P HASE T ECHNOLOGIES , LLC
By:  

  /s/ Michael Lewis

              Michael Lewis
               Chief Financial Officer

[Signature Page to Supplemental Indenture]


THE BANK OF NEW YORK MELLON, as Trustee
By:  

  /s/ Laurence J. O’Brien

  Name:   Laurence J. O’Brien
  Title:   Vice President

[Signature Page to Supplemental Indenture]

Exhibit 99.1

 

LOGO

Power Solutions International , Inc.   

201 Mittel Drive

Wood Dale, IL 60191

www.psiengines.com

Power Solutions International Announces Amendment to Indenture

WOOD DALE, Ill., April 4, 2016 (GLOBE NEWSWIRE) — Power Solutions International, Inc. (“PSI” or “the Company”) (NASDAQ:PSIX), a leader in the design, engineer and manufacture of emissions-certified alternative-fuel and conventional power systems, today announced an amendment to its April 29, 2015 indenture (“Indenture”) covering its $55.0 million 5.50% Senior Notes due 2018 (“Notes”). The amendment provides the Company with increased financial flexibility throughout the remaining term of the Notes, and includes, among other things:

 

    an increase of permitted indebtedness to $145.0 million (as defined by the agreement, with such amount reducing to $135.0 million effective February 1, 2017);

 

    the elimination of the special mandatory offer to purchase (as defined by the agreement); and

 

    an increase in the interest rate to 6.50%.

Michael Lewis, Chief Financial Officer of PSI, stated, “PSI gains meaningful financial flexibility from these amended terms, an important step in restructuring our debt to support the expected growth in on-road opportunities during the second half of 2016. The second half ramp-up of these opportunities is critical to meet our financial goals for the year, and to establish a solid base for 2017 and beyond.”

About Power Solutions International, Inc.

Power Solutions International, Inc. (PSI or the Company) is a leader in the design, engineer and manufacture of emissions-certified, alternative-fuel power systems. PSI provides integrated turnkey solutions to leading global original equipment manufacturers in the industrial and on-road markets. The Company’s unique in-house design, prototyping, engineering and testing capacities allow PSI to customize clean, high-performance engines that run on a wide variety of fuels, including natural gas, propane, biogas, gasoline and diesel.

PSI develops and delivers complete industrial power systems that are used worldwide in stationary and mobile power generation applications supporting standby, prime, and Co-generation power (CHP) applications; mobile industrial applications that include forklifts, aerial lifts, industrial sweepers, aircraft ground support, arbor, agricultural and construction equipment. In addition, PSI develops and delivers power systems purpose built for the Class 3 through Class 7 medium duty trucks and buses for the North American and Asian markets.

For more information on PSI, visit www.psiengines.com .

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements regarding the current expectations of the Company about its prospects and opportunities. These forward-looking statements are covered by the


“Safe Harbor for Forward-Looking Statements” provided by the Private Securities Litigation Reform Act of 1995. The Company has tried to identify these forward looking statements by using words such as “expect,” “contemplate,” “anticipate,” “estimate,” “plan,” “will,” “would,” “should,” “forecast,” “believe,” “outlook,” “guidance,” “projection,” “target” or similar expressions, but these words are not the exclusive means for identifying such statements. The Company cautions that a number of risks, uncertainties and other factors could cause the Company’s actual results to differ materially from those expressed in, or implied by, the forward-looking statements, including, without limitation, the continued development and expansion of the market for alternative-fuel power systems; technological and other risks relating to the Company’s development of its 8.8 and 4.3 liter engines, introduction of other new products and entry into on-road markets (including the risk that these initiatives may not be successful); the timing of new products; the Company’s ability to integrate recent acquisitions into the business of the Company successfully and the amount of time and expense spent and incurred in connection with the integration; the risk that the economic benefits, cost savings and other synergies that the Company originally anticipated as a result of recent acquisitions are not fully realized or take longer to realize than expected; the significant strain on the Company’s senior management team, support teams, manufacturing lines, information technology platforms and other resources resulting from rapid expansion of the Company’s operations (including as a result of recent acquisitions); volatility in oil and gas prices; changes in environmental and regulatory policies; significant competition; global economic conditions (including their impact on demand growth); and the Company’s dependence on key suppliers. For a detailed discussion of factors that could affect the Company’s future operating results, please see the Company’s filings with the Securities and Exchange Commission, including the disclosures under “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in those filings. Except as expressly required by the federal securities laws, the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events or for any other reason.

Contact:

Power Solutions International, Inc.

Michael Lewis

Chief Financial Officer

+1 (630) 350-9400

michael.lewis@psiengines.com

The Blueshirt Group

Gary Dvorchak, CFA

Managing Director

+1 (323) 240-5796

gary@blueshirtgroup.com