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• | adverse changes in general economic conditions, including the interest rate environment and the financial markets; |
• | risks associated with the global outbreak of a novel strain of coronavirus (“COVID-19”), including additional strains of COVID-19 that continue to emerge, and the mitigation efforts by governments and related effects on us, our customers, and our employees; |
• | our estimates of the allowance for finance receivable losses may not be adequate to absorb actual losses, causing our provision for finance receivable losses to increase, which would adversely affect our results of operations; |
• | increased levels of unemployment and personal bankruptcies; |
• | adverse changes in the rate at which we can collect or potentially sell our finance receivables portfolio; |
• | natural or accidental events such as earthquakes, hurricanes, tornadoes, fires, or floods affecting our customers, collateral, or our branches or other operating facilities; |
• | war, acts of terrorism, riots, civil disruption, pandemics, disruptions in the operation of our information systems, or other events disrupting business or commerce; |
• | risks related to the acquisition or sale of assets or businesses or the formation, termination, or operation of joint ventures or other strategic alliances, including increased loan delinquencies or net charge-offs, integration or migration issues, increased costs of servicing, incomplete records, and retention of customers; |
• | a failure in or breach of our operational or security systems or infrastructure or those of third parties, including as a result of cyber-attacks, or other cyber-related incidents involving the loss, theft or unauthorized disclosure of personally identifiable information (“PII”) of our present or former customers; |
• | our credit risk scoring models may be inadequate to properly assess the risk of customer unwillingness or lack of capacity to repay; |
• | adverse changes in our ability to attract and retain employees or key executives to support our businesses; |
• | increased competition, or changes in customer responsiveness to our distribution channels, an inability to make technological improvements, and the ability of our competitors to offer a more attractive range of personal loan products than we offer; |
• | changes in federal, state, or local laws, regulations, or regulatory policies and practices that adversely affect our ability to conduct business or the manner in which we currently are permitted to conduct business, such as licensing requirements, pricing limitations or restrictions on the method of offering products, as well as changes that may result from increased regulatory scrutiny of the sub-prime lending industry, our use of third-party vendors and real estate loan servicing, or changes in corporate or individual income tax laws or regulations, including effects of the Tax Act, the Coronarvirus Aid, Relief, and Economic Security Act (the “CARES Act”), the Consolidated Appropriations Act of 2021 (the “CAA”), and the American Rescue Plan of 2021 (the “ARPA”); |
• | risks associated with our insurance operations, including insurance claims that exceed our expectations or insurance losses that exceed our reserves; |
• | our inability to successfully implement our growth strategy for our consumer lending business; |
• | a change in the proportion of secured loans may affect our finance receivables and portfolio yield; |
• | increases in actual or projected delinquencies or net charge-offs or declines in collateral values; |
• | potential liability relating to finance receivables which we have sold or securitized or may sell or securitize in the future if it is determined that there was a non-curable breach of a representation or warranty made in connection with such transactions; |
• | the costs and effects of any actual or alleged violations of any federal, state, or local laws, rules or regulations, including any associated litigation and damage to our reputation; |
• | the costs and effects of any fines, penalties, judgments, decrees, orders, inquiries, investigations, subpoenas, or enforcement or other proceedings of any governmental or quasi-governmental agency or authority and any associated litigation and damage to our reputation; |
• | our continued ability to access the capital markets and maintain adequate current sources of funds to satisfy our cash flow requirements; |
• | our ability to comply with our debt covenants; |
• | our ability to generate sufficient cash to service all of our indebtedness; |
• | any material impairment or write-down of the value of our assets; |
• | the ownership of OMH’s common stock continues to be highly concentrated, which may prevent other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest; |
• | the effects of any downgrade of our debt ratings by credit rating agencies, which could have a negative impact on our cost of and/or access to capital; |
• | our substantial indebtedness, which could prevent us from meeting our obligations under our debt instruments and limit our ability to react to changes in the economy or our industry or limit our ability to incur additional borrowings; |
• | our ability to maintain sufficient capital levels in our regulated and unregulated subsidiaries; |
• | changes in accounting standards or tax policies and practices and the application of such new standards, policies and practices; |
• | management estimates and assumptions, including estimates and assumptions about future events, may prove to be incorrect; and |
• | other risks described in “Risk Factors” in this prospectus supplement. |
1 | As of July 15, 2021, we had 133,810,184 shares outstanding. The number of shares of common stock outstanding as of July 15, 2021 excludes 1,015,569 unvested restricted stock units (including performance-based restricted stock units, assuming maximum performance is achieved) that have been granted to certain of our non-employee directors, executive officers and other employees. |
| | For the Six Months Ended June 30, | | | For the Years Ended December 31, | ||||||||||
(dollars in millions, except per share amounts) | | | 2021 | | | 2020 | | | 2020 | | | 2019 | | | 2018 |
Consolidated Statements of Operations Data: | | | | | | | | | | | |||||
Interest income | | | $ 2,130 | | | $ 2,184 | | | $ 4,368 | | | $ 4,127 | | | $ 3,658 |
Interest expense | | | 465 | | | 527 | | | 1,027 | | | 970 | | | 875 |
Provision for finance receivable losses | | | 130 | | | 954 | | | 1,319 | | | 1,129 | | | 1,048 |
Net interest income after provision for finance receivables losses | | | 1,535 | | | 703 | | | 2,022 | | | 2,028 | | | 1,735 |
Other revenues | | | 241 | | | 289 | | | 526 | | | 622 | | | 574 |
Other expenses | | | 766 | | | 831 | | | 1,571 | | | 1,552 | | | 1,685 |
Income before income taxes | | | 1,010 | | | 161 | | | 977 | | | 1,098 | | | 624 |
Income tax expense | | | 247 | | | 40 | | | 247 | | | 243 | | | 177 |
Net income | | | $763 | | | $121 | | | $730 | | | $855 | | | $447 |
| | | | | | | | | | ||||||
Earnings per share of OneMain Holdings, Inc.: | | | | | | | | | | | |||||
Basic | | | $5.68 | | | $0.90 | | | $5.42 | | | $6.28 | | | $3.29 |
Diluted | | | $5.67 | | | $0.90 | | | $5.41 | | | $6.27 | | | $3.29 |
| | At June 30, | | | At December 31, | |||||||
(dollars in millions) | | | 2021 | | | 2020 | | | 2020 | | | 2019 |
Consolidated Balance Sheet Data: | | | | | | | | | ||||
Net finance receivables, less unearned insurance premium and claim reserves and allowance for finance receivable losses | | | $ 15,435 | | | $ 14,606 | | | $ 15,044 | | | $ 16,767 |
Total assets | | | 22,377 | | | 22,508 | | | 22,471 | | | 22,817 |
Long-term debt(a) | | | 17,605 | | | 18,010 | | | 17,800 | | | 17,212 |
Total liabilities | | | 18,840 | | | 19,337 | | | 19,030 | | | 18,487 |
Total shareholders’ equity | | | 3,537 | | | 3,171 | | | 3,441 | | | 4,330 |
(a) | Long-term debt is comprised of the following: |
| | At June 30, | | | At December 31, | |||||||
(dollars in millions) | | | 2021 | | | 2020 | | | 2020 | | | 2019 |
Long-term debt: | | | | | | | | | ||||
Consumer securitization debt | | | $7,466 | | | $7,835 | | | $7,789 | | | $7,643 |
Total existing senior notes | | | 9,967 | | | 10,003 | | | 9,839 | | | 9,397 |
Total existing senior debt | | | 17,433 | | | 17,838 | | | 17,628 | | | 17,040 |
Junior subordinated debt (hybrid debt) | | | 172 | | | 172 | | | 172 | | | 172 |
Total debt | | | $ 17,605 | | | $ 18,010 | | | $ 17,800 | | | $ 17,212 |
| | Six Months Ended June 30, | | | Year Ended December 31, | ||||||||||
(dollars in millions) | | | 2021 | | | 2020 | | | 2020 | | | 2019 | | | 2018 |
Consumer and Insurance | | | | | | | | | | | |||||
Income before income taxes—Segment Accounting Basis | | | $ 1,041 | | | $ 179 | | | $ 1,021 | | | $ 1,168 | | | $ 787 |
Adjustments: | | | | | | | | | | | |||||
Direct costs associated with COVID-19(1) | | | 4 | | | 9 | | | 17 | | | — | | | — |
Acquisition-related transaction and integration expenses | | | — | | | 8 | | | 11 | | | 14 | | | 47 |
Net loss on repurchases and repayments of debts | | | 39 | | | — | | | 36 | | | 30 | | | 63 |
Net gain on sale of cost method investment | | | — | | | — | | | — | | | (11) | | | — |
Restructuring charges | | | — | | | 7 | | | 7 | | | 5 | | | 8 |
Adjusted pretax income (non-GAAP) | | | $1,084 | | | $203 | | | $1,092 | | | $1,206 | | | $905 |
| | | | | | | | | | ||||||
Other | | | | | | | | | | | |||||
Loss before income tax benefit—Segment Accounting Basis | | | $(4) | | | $(2) | | | $(9) | | | $(3) | | | $(131) |
Adjustments: | | | | | | | | | | | |||||
Additional net gain on sale of SpringCastle interests | | | (1) | | | — | | | (4) | | | (7) | | | — |
Lower of cost or fair value adjustment(2) | | | 2 | | | — | | | 7 | | | — | | | — |
Non-cash incentive compensation expense | | | — | | | — | | | — | | | — | | | 106 |
Net loss on sale of real estate loans(3) | | | — | | | — | | | — | | | 1 | | | 6 |
Adjusted pretax loss (non-GAAP) | | | $(3) | | | $(2) | | | $(6) | | | $(9) | | | $(19) |
(1) | Direct costs associated with COVID-19 include (i) information technology costs to transition employees to work remotely, (ii) branch, central operations, and corporate locations sanitization services and supplies, (iii) installation of protective barriers and other appropriate safety measures and (iv) other costs and fees directly related to COVID-19. |
(2) | The carrying value of the remaining real estate loans classified in finance receivables held for sale exceeded their fair value, and accordingly, were marked to fair value and an impairment was recorded in other revenue during the six months ended June 30, 2021 and year ended December 31, 2020. |
(3) | In 2019 and 2018, the resulting impairments of finance receivables held for sale that remained after the February 2019 and the December 2018 real estate loan sales were combined with the respective gains on sales. |
| | Beneficial Ownership Prior to Offering | | | Number of Shares of Common Stock Being Offered Hereby Assuming Underwriters’ Option is Not Exercised | | | Beneficial Ownership After Offering Assuming Underwriters’ Option is Not Exercised(c) | | | Number of Shares of Common Stock Being Offered Hereby Assuming Underwriters’ Option is Exercised | | | Beneficial Ownership After Offering Assuming Underwriters’ Option is Exercised(c) | ||||||||||
Name | | | Common Stock | | | Percentage of Common Stock | | | Common Stock | | | Percentage of Common Stock | | | Common Stock | | | Percentage of Common Stock | ||||||
Apollo Management Holdings GP, LLC(a)(b) | | | 36,537,500 | | | 27.3% | | | 8,000,000 | | | 28,537,500 | | | 21.6% | | | 9,200,000 | | | 27,337,500 | | | 20.7% |
(a) | All information about Apollo is based on a Schedule 13D/A (the “Apollo Schedule 13D”) filed with the SEC by Apollo Management Holdings GP, LLC and the other reporting persons listed therein on May 6, 2021. As set forth in the Apollo Schedule 13D, each of Apollo Management Holdings GP, LLC, Apollo Management Holdings, L.P., Apollo Management GP, LLC, Apollo Management, L.P., AIF VIII Management, LLC, Management VIII, Uniform GP, and OMH Holdings, L.P. beneficially owns and has shared voting and dispositive power over 36,537,500 shares of Company common stock; each of OMH (ML), L.P and OMH (ML) GP, LLC beneficially owns and has shared dispositive power over 28,985,208 shares of Company common stock (up to 9,200,000 of which are being sold in this offering, assuming the underwriter’s option to purchase additional shares is exercised in full); and each of V-OMH (ML) II, L.P and V-OMH (ML) GP II, LLC beneficially owns and has shared voting power over 7,552,292 shares of Company common stock (none of which are being sold in this offering). Various relationships among such persons are described in the Apollo Schedule 13D. As set forth in the Apollo Schedule 13D, the principal address for OMH (ML), L.P, OMH (ML) GP, LLC, and OMH Holdings, L.P. is One Manhattanville Road, Suite 201, Purchase, New York 10577; the principal address for V-OMH (ML) II, L.P and V-OMH (ML) GP II, LLC is 901 Marquette Avenue, South, Suite 3300, Minneapolis, MN 55402; and the principal address of each of Apollo Management Holdings, GP, LLC, Apollo Management Holdings, L.P., Apollo Management GP, LLC, Apollo Management, L.P., AIF VIII Management, LLC, Management VIII, and Uniform GP is 9 West 57th Street, 43rd Floor, New York, New York 10019. |
(b) | As of December 16, 2019, the Apollo-Värde Group informed OMH that it had undertaken to pledge all of its 54,937,500 shares of Company common stock beneficially owned at that time pursuant to margin loan agreements and related documentation on a non-recourse basis. The Apollo-Värde Group further informed OMH that the loan to value ratio in connection with the loans on January 22, 2021 was equal to approximately 19%. The Apollo-Värde Group informed OMH that the margin loan agreements contain customary default provisions, and in the event of an event of default under the loan agreements, the lenders thereunder may foreclose upon any and all shares of Company common stock pledged to them. In connection with the margin loan facility, on December 16, 2019, OMH Holdings, L.P. contributed 43,581,932 shares of Company common stock to OMH (ML), L.P. and 11,355,568 shares of Company common stock to V-OMH (ML) II, L.P. Accordingly, among the Apollo-Värde Group, the selling stockholder, an entity managed by affiliates of Apollo, and V-OMH (ML) II, L.P., an entity managed by an affiliate of Värde, are the holders of record of the securities of the Company. During the first and second quarters of 2021, the selling stockholder and V-OMH (ML) II, L.P. sold 14,596,724 and 3,803,276 shares of Company common stock, respectively, in underwritten registered public offerings. |
(c) | The percentage of beneficial ownership of our common stock after this offering is based on 132,110,184 shares of common stock outstanding as of July 15, 2021 after giving effect to the repurchase by OMH of 1,600,000 shares in the Concurrent Share Buyback). |
• | offer, pledge, sell or contract to sell any common stock, |
• | sell any option or contract to purchase any common stock, |
• | purchase any option or contract to sell any common stock, |
• | grant any option, right or warrant for the sale of any common stock, |
• | otherwise dispose of or transfer any common stock, |
• | request or demand that we file a registration statement related to the common stock, or |
• | enter into any swap or other agreement that transfers, in whole or in part, the economic consequence of ownership of any common stock whether any such swap or transaction is to be settled by delivery of shares or other securities, in cash or otherwise. |
• | Combined Annual Report of OMH and OMFC on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 9, 2021; |
• | Combined Quarterly Report of OMH and OMFC on Form 10-Q for the quarter ended March 31, 2021, filed with the SEC on April 27, 2021 and the combined Quarterly Report of OMH and OMFC on Form 10-Q for the quarter ended June 30, 2021, filed with the SEC on July 23, 2021; |
• | Current Reports of OMH on Form 8-K filed with the SEC on February 16, 2021, March 10, 2021, May 4, 2021, May 27, 2021, June 17, 2021, June 22, 2021 and July 16, 2021; |
• | those portions of the Definitive Proxy Statement of OMH on Schedule 14A filed with the SEC on April 13, 2021 incorporated by reference in the Annual Report of OMH on Form 10-K for the year ended December 31, 2020; and |
• | the description of OMH common stock set forth in its registration statement on Form 8-A filed with the SEC on October 11, 2013. |
• | shares of its common stock; |
• | shares of its preferred stock, which it may issue in one or more series; |
• | depositary shares representing shares of its preferred stock; |
• | debt securities, which may be senior, subordinated or junior subordinated debt securities; |
• | warrants to purchase debt or equity securities; |
• | stock purchase contracts to purchase shares of its common stock; and |
• | stock purchase units, each representing ownership of a stock purchase contract and debt securities, preferred securities or debt obligations of third-parties, including U.S. treasury securities or any combination of the foregoing, securing the holder’s obligation to purchase its common stock or other securities under the stock purchase contracts. |
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• | Combined Annual Report of OMH and SFC (now known as OMFC) on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 14, 2020 (“2019 Annual Report on Form 10-K”); |
• | Combined Quarterly Reports of OMH and SFC (now known as OMFC) on Form 10-Q for the quarter ended March 31, 2020, and Combined Quarterly Reports of OMH and OMFC on Form 10-Q for the quarters ended June 30, 2020 and September 30, 2020, filed with the SEC on April 29, 2020, July 30, 2020, and October 29, 2020, respectively; |
• | Current Reports of OMH on Form 8-K, filed with the SEC on March 3, 2020, March 18, 2020, April 23, 2020, May 14, 2020, May 22, 2020, June 29, 2020, July 17, 2020, July 20, 2020 and August 31, 2020; |
• | Current Reports of OMFC on Form 8-K, filed with the SEC on May 14, 2020 and June 29, 2020; |
• | Those portions of the Definitive Proxy Statement of OMH on Schedule 14A filed with the SEC on April 6, 2020 incorporated by reference in the 2019 Annual Report on Form 10-K; and |
• | The description of OMH’s common stock set forth in its registration statement on Form 8-A filed with the SEC on October 11, 2013. |
• | adverse changes in general economic conditions, including the interest rate environment and the financial markets; |
• | risks associated with the global outbreak of a novel strain of coronavirus (“COVID-19”) and the mitigation efforts by governments and related effects on us, our customers, and employees; |
• | our estimates of the allowance for finance receivable losses may not be adequate to absorb actual losses, causing our provision for finance receivable losses to increase, which would adversely affect our results of operations; |
• | increased levels of unemployment and personal bankruptcies; |
• | adverse changes in the rate at which we can collect or potentially sell our finance receivables portfolio; |
• | natural or accidental events such as earthquakes, hurricanes, tornadoes, fires, or floods affecting our customers, collateral, or our branches or other operating facilities; |
• | war, acts of terrorism, riots, civil disruption, pandemics, disruptions in the operation of our information systems, or other events disrupting business or commerce; |
• | risks related to the acquisition or sale of assets or businesses or the formation, termination, or operation of joint ventures or other strategic alliances, including increased loan delinquencies or net charge-offs, integration or migration issues, increased costs of servicing, incomplete records, and retention of customers; |
• | a failure in or breach of our operational or security systems or infrastructure or those of third parties, including as a result of cyber-attacks, or other cyber-related incidents involving the loss, theft or unauthorized disclosure of personally identifiable information, or “PII,” of our present or former customers; |
• | our credit risk scoring models may be inadequate to properly assess the risk of customer unwillingness or lack of capacity to repay; |
• | adverse changes in our ability to attract and retain employees or key executives to support our businesses; |
• | increased competition, or changes in customer responsiveness to our distribution channels, an inability to make technological improvements, and the ability of our competitors to offer a more attractive range of personal loan products than we offer; |
• | changes in federal, state, or local laws, regulations, or regulatory policies and practices that adversely affect our ability to conduct business or the manner in which we currently are permitted to conduct business, such as licensing requirements, pricing limitations or restrictions on the method of offering products, as well as changes that may result from increased regulatory scrutiny of the sub-prime |
• | risks associated with our insurance operations, including insurance claims that exceed our expectations or insurance losses that exceed our reserves; |
• | our inability to successfully implement our growth strategy for our consumer lending business or successfully acquire portfolios of personal loans; |
• | a change in the proportion of secured loans may affect our personal loan receivables and portfolio yield; |
• | declines in collateral values or increases in actual or projected delinquencies or net charge-offs; |
• | potential liability relating to finance receivables which we have sold or securitized or may sell or securitize in the future if it is determined that there was a non-curable breach of a representation or warranty made in connection with such transactions; |
• | the costs and effects of any actual or alleged violations of any federal, state, or local laws, rules or regulations, including any associated litigation and damage to our reputation; |
• | the costs and effects of any fines, penalties, judgments, decrees, orders, inquiries, investigations, subpoenas, or enforcement or other proceedings of any governmental or quasi-governmental agency or authority and any associated litigation and damage to our reputation; |
• | our continued ability to access the capital markets and maintain adequate current sources of funds to satisfy our cash flow requirements; |
• | our ability to comply with our debt covenants; |
• | our ability to generate sufficient cash to service all of our indebtedness; |
• | any material impairment or write-down of the value of our assets; |
• | the ownership of OMH’s common stock continues to be highly concentrated, which may prevent other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest; |
• | the effects of any downgrade of our debt ratings by credit rating agencies, which could have a negative impact on our cost of and/or access to capital; |
• | our substantial indebtedness, which could prevent us from meeting our obligations under our debt instruments and limit our ability to react to changes in the economy or our industry or our ability to incur additional borrowings; |
• | our ability to maintain sufficient capital levels in our regulated and unregulated subsidiaries; |
• | changes in accounting standards or tax policies and practices and the application of such new standards, policies and practices; and |
• | management estimates and assumptions, including estimates and assumptions about future events, may prove to be incorrect. |
• | whether the issuer of the debt securities is OMH or OMFC; |
• | the title and aggregate principal amount of the debt securities and any limit on the aggregate principal amount; |
• | whether the debt securities will be senior, subordinated or junior subordinated; |
• | any applicable subordination provisions for any subordinated debt securities; |
• | the maturity date(s) or method for determining same; |
• | the interest rate(s) or the method for determining same; |
• | the dates on which interest will accrue or the method for determining dates on which interest will accrue and dates on which interest will be payable and whether interest shall be payable in cash or additional securities; |
• | whether the debt securities are convertible or exchangeable into other securities and any related terms and conditions; |
• | redemption or early repayment provisions; |
• | authorized denominations; |
• | if other than the principal amount, the principal amount of debt securities payable upon acceleration; |
• | place(s) where payment of principal and interest may be made, where debt securities may be presented and where notices or demands upon the issuer may be made; |
• | whether such debt securities will be issued in whole or in part in the form of one or more global securities and the date on which the securities are dated if other than the date of original issuance; |
• | amount of discount or premium, if any, at which such debt securities will be issued; |
• | whether the indenture will contain any additional covenants, or eliminate or change any covenants described herein, that apply to the debt securities; |
• | any additions or changes in the defaults and events of default applicable to the particular debt securities being issued; |
• | the guarantors of each series, if any, and the extent of the guarantees (including provisions relating to seniority, subordination and release of the guarantees), if any; |
• | the currency, currencies or currency units in which the purchase price for, the principal of and any premium and any interest on, such debt securities will be payable; |
• | the time period within which, the manner in which and the terms and conditions upon which the holders of the debt securities or the issuer can select the payment currency; |
• | our obligation or right to redeem, purchase or repay debt securities under a sinking fund, amortization or analogous provision; |
• | any restriction or conditions on the transferability of the debt securities; |
• | provisions granting special rights to holders of the debt securities upon occurrence of specified events; |
• | additions or changes relating to compensation or reimbursement of the trustee of the series of debt securities; |
• | additions or changes to the provisions for the defeasance of the debt securities or to provisions related to satisfaction and discharge of the indenture; |
• | provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture and the execution of supplemental indentures for such series; and |
• | any other terms of the debt securities (which terms shall not be inconsistent with the provisions of the TIA, but may modify, amend, supplement or delete any of the terms of the indenture with respect to such debt securities). |
(a) | The issuer will not at any time, directly or indirectly, suffer to exist, and shall not cause, suffer or permit any Subsidiary to create, assume or suffer to exist, any Mortgage of or upon any of its or their properties or assets, real or personal, whether owned at the issue date or thereafter acquired, or of its or upon any income or profit therefrom, without making effective provision, and the issuer covenants that in any such case the issuer will make or cause to be made effective provision, whereby the debt securities shall be secured by such Mortgage equally and ratably with or prior to any and all other obligations and Indebtedness to be secured thereby, so long as any such other obligations and Indebtedness shall be so secured. |
(b) | Nothing in this covenant shall be construed to prevent the issuer or any Subsidiary from creating, assuming or suffering to exist, and the issuer or any Subsidiary is hereby expressly permitted to create, assume or suffer to exist, without securing the debt securities as hereinabove provided, any Mortgage of the following character: |
(1) | any Mortgage on any properties or assets of the issuer or any Subsidiary existing on the issue date; |
(2) | any Mortgage on any properties or assets of the issuer or any Subsidiary, in addition to those otherwise permitted by this subsection (b) of this covenant, securing Indebtedness of the issuer or any Subsidiary and refundings or extensions of any such Mortgage and the Indebtedness secured thereby for amounts not exceeding the principal amount of the Indebtedness so refunded or extended at the time of the refunding or extension thereof and covering only the same property theretofore securing the same; provided that at the time such Indebtedness was initially incurred, the aggregate amount of secured Indebtedness permitted by this paragraph (2), after giving effect to such incurrence, does not exceed 10% of Consolidated Net Tangible Assets, as applicable; |
(3) | any Mortgage on any property or assets of any Subsidiary to secure Indebtedness owing by it to the issuer or to a Wholly-owned Subsidiary; |
(4) | any Mortgage on any property or assets of any Subsidiary to secure, in the ordinary course of business, its Indebtedness, if as a matter of practice, prior to the time it became a Subsidiary, it had borrowed on the basis of secured loans or had customarily deposited collateral to secure any or all of its obligations; |
(5) | any purchase money Mortgage on property, real or personal, acquired or constructed by the issuer or any Subsidiary after the issue date, to secure the purchase price of such property (or to secure Indebtedness incurred for the purpose of financing the acquisition or construction of any such property to be subject to such Mortgage), or Mortgages existing on any such property at the time of acquisition, whether or not assumed, or any Mortgage existing on any property of any corporation at the time it becomes a Subsidiary, or any Mortgage with respect to any property hereafter acquired; provided, however, that the aggregate principal amount of the Indebtedness secured by all such Mortgages on a particular parcel of property shall not exceed 75% of the cost of such property, including the improvements thereon, to the issuer or any such Subsidiary; and provided, further, that any such Mortgage does not spread to other property owned prior to such acquisition or construction or to property thereafter acquired or constructed other than additions to such property; |
(6) | refinancing, refunding, extension, renewal or replacement (or successive refinancings, refundings, extensions, renewals or replacements) of any Mortgage permitted by this subsection (b) of this covenant (other than pursuant to paragraph (2) hereof) for amounts not exceeding (A) the principal amount of the Indebtedness so refinanced, refunded, extended, renewed or replaced at the time of the refunding or extension thereof, and (B) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement, and covering only the same property theretofore securing the same; |
(7) | deposits, liens or pledges to enable the issuer or any Subsidiary to exercise any privilege or license, or to secure payments of workmen’s compensation, unemployment insurance, old age pensions or other social security, or to secure the performance of bids, tenders, contracts or leases to which the issuer or any Subsidiary is a party, or to secure public or statutory obligations of the issuer or any Subsidiary, or to secure surety, stay or appeal bonds to which the issuer or any Subsidiary is a party; or other similar deposits, liens or pledges made in the ordinary course of business; |
(8) | mechanics’, workmen’s, repairmen’s, materialmen’s, or carriers’ liens; or other similar liens arising in the ordinary course of business; or deposits or pledges to obtain the release of any such liens; |
(9) | liens arising out of judgments or awards against the issuer or any Subsidiary with respect to which the issuer or such Subsidiary shall in good faith be prosecuting an appeal or proceedings for review; or liens incurred by the issuer or any Subsidiary for the purpose of obtaining a stay or discharge in the course of any legal proceeding to which the issuer or such Subsidiary is a party; |
(10) | liens for taxes not yet subject to penalties for non-payment or contested, or minor survey exceptions, or minor encumbrances, easements or reservations of, or rights of others for, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or |
(11) | other liens, charges and encumbrances incidental to the conduct of its business or the ownership of its property and assets which were not incurred in connection with the borrowing of money or the obtaining of advances or credit, and which do not in the aggregate materially detract from the value of its property and assets or materially impair the use thereof in the operation of its business; and |
(12) | any Mortgage created by the issuer or any Subsidiary in connection with a transaction intended by the issuer or such Subsidiary to be one or more sales of properties or assets of the issuer or such Subsidiary; provided that such Mortgage shall only apply to the properties or assets involved in such sale or sales, the income from such properties or assets and/or the proceeds of such properties or assets. |
(c) | If at any time the issuer or any Subsidiary shall create or assume any Mortgage not permitted by subsection (b) of this covenant, to which the covenant in subsection (a) of this covenant is applicable, the issuer shall promptly deliver to the trustee (1) an officers’ certificate stating that the covenant of the issuer contained in subsection (a) of this covenant has been complied with; and (2) an opinion of counsel to the effect that such covenant has been complied with, and that any instruments executed by the issuer in the performance of such covenant comply with the requirements of such covenant. |
(d) | In the event that the issuer shall hereafter secure the debt securities equally and ratably with (or prior to) any other obligation or Indebtedness pursuant to the provisions of this covenant, the trustee is hereby authorized to enter into an indenture or agreement supplemental hereto and to take such action, if any, as the Company may deem advisable to enable the trustee to enforce effectively the rights of the holders of the debt securities so secured equally and ratably with (or prior to) such other obligation or indebtedness. |
(a) | (i) in the case of a merger, the issuer is the surviving entity in such merger, or (ii) in the case of a merger in which the issuer is not the surviving entity or in the case of a consolidation or a sale or conveyance of assets, the entity into which the issuer is merged or the entity which is formed by such consolidation or which acquires by sale or conveyance all or substantially all of the issuer’s assets shall be a corporation, association, company or business trust organized and existing under the laws of the United States of America or a State thereof and such successor entity shall expressly assume the due and punctual payment of the principal of and any premium and interest on all the debt securities, according to their tenor, and the due and punctual performance and observance of all of the covenants under the applicable indenture and the debt securities to be performed or observed by the issuer by a supplemental indenture in form satisfactory to the trustee, executed and delivered to the trustee by such entity; and |
(b) | the issuer or such successor entity, as the case may be, shall not, immediately after such merger or consolidation, or such sale or conveyance, be in default in the performance or observance of any such covenant and shall not immediately thereafter have outstanding (or otherwise be liable for) any Indebtedness secured by a Mortgage not expressly permitted by the provisions of the applicable indenture or shall have secured the debt securities thereunder equally and ratably with (or prior to) any Indebtedness secured by any Mortgage not so permitted; and |
(c) | the issuer shall have delivered to the trustee an officer’s certificate and an opinion of counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with the indenture and an opinion of counsel stating that such supplemental indenture (if any) has been duly authorized, executed and delivered and is a legal, valid and binding agreement enforceable against the successor entity. |
• | change the Stated Maturity of the principal of, or any installment of principal of, or interest on, any outstanding debt security; |
• | reduce the principal amount of, or the rate or amount of interest on, or any premium payable with respect to, any debt security; |
• | change the places or currency of payment of the principal of, or any premium or interest on, any debt security; |
• | impair the right to sue for the enforcement of any payment of principal of, or any premium or interest on, any debt security on or after the date the payment is due; |
• | reduce the percentage in aggregate principal amount of outstanding debt securities of any series necessary to: |
(a) | modify or amend the applicable indenture with respect to that series, |
(b) | waive any past default or compliance with certain restrictive provisions, or |
(b) | constitute a quorum or take action at a meeting; or |
• | otherwise modify the provisions of the indenture concerning modification or amendment or concerning waiver of compliance with certain provisions of, or certain defaults and their consequences under, the indenture, except to: |
(a) | increase the percentage of outstanding debt securities necessary to modify or amend the indenture or to give the waiver, or |
(b) | provide that certain other provisions of the applicable indenture cannot be modified or waived without the consent of the holder of each outstanding debt security affected by the modification or waiver. |
• | to evidence that another entity is the issuer’s or a guarantor’s successor, as applicable, and has assumed the issuer’s or guarantors obligations with respect to the debt securities; |
• | to add to the issuer’s or a guarantor’s covenants, as applicable, for the benefit of the holders of all or any series of debt securities or to surrender any of the issuer’s or guarantor’s rights or powers under the applicable indenture; |
• | to add any Events of Default to all or any series of debt securities; |
• | to delete or modify any Events of Default with respect to all or any series of debt securities and to specify the rights and remedies of the trustee and the holders of such securities in connection therewith; |
• | to change or eliminate any restrictions on the payment of the principal of, or any premium or interest on, any debt securities, to modify the provisions relating to global debt securities, or to permit the issuance of debt securities in uncertificated form, so long as in any such case the interests of the holders of debt securities are not adversely affected in any material respect; |
• | to add to, change or eliminate any provision of the applicable indenture in respect of one or more series of debt securities, so long as either |
(a) | there is no outstanding debt security of any series entitled to the benefit of the provision; or |
(b) | the amendment does not apply to any then outstanding debt security; |
• | to secure any series of the debt securities’ |
• | to provide for the appointment of a successor trustee with respect to the debt securities of one or more series and to add to or change any of the provisions to facilitate the administration of the trusts under the applicable indenture by more than one trustee; |
• | to facilitate the satisfaction and discharge, or Legal Defeasance or Covenant Defeasance with respect to the debt securities of any series by the deposit in trust of money and/or Government Obligations; |
• | to cure any ambiguity, defect, mistake or inconsistency in the applicable indenture, debt security or debt security guarantee; or |
• | to make any other changes with respect to matters or questions arising under the applicable indenture, or any series of debt security or debt security guarantee so long as the action does not adversely affect the interests of the holders of the debt securities of any series in any material respect. |
(a) | either |
(1) | all debt securities that have been authenticated, except lost, stolen or destroyed debt securities that have been replaced or paid and debt securities for whose payment money has been deposited in trust and thereafter repaid to the issuer, have been delivered to the trustee for cancellation; or |
(2) | all debt securities that have not been delivered to the trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the trustee for the giving of notice of redemption by the trustee in the name, and at the expense of the issuer, and the issuer has irrevocably deposited or caused to be deposited with the trustee as trust funds in trust solely for the benefit of the holders, cash in U.S. dollars, Government Obligations, or a combination of cash in U.S. dollars and Government Obligations, in such amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the Notes not delivered to the trustee for cancellation for principal, premium, if any, and accrued interest to the date of maturity or redemption; |
(b) | the issuer has paid or caused to be paid all sums payable by it under the indenture; and |
(c) | in the event of a deposit as provided in clause (i)(b) above, the issuer has delivered irrevocable instructions to the trustee under the indenture to apply the deposited money toward the payment of the debt securities at maturity or the redemption date, as the case may be. |
(a) | a default in the payment of any interest payable in respect of any debt security, when such interest becomes due and payable, and continuance of such default for a period of 30 days; |
(b) | a default in the payment of the principal of and any premium on any debt security when it becomes due and payable at its maturity; |
(c) | a default in the deposit of any sinking fund payment, when and as due by the terms of a security of that series; |
(d) | a default by the issuer in the performance or breach of any covenant or warranty under the Indentures, and the continuance of such default or breach for a period of 90 days; and |
(e) | certain events in bankruptcy, insolvency or reorganization of the issuer. |
• | 2,000,000,000 shares of common stock, par value $0.01 per share; and |
• | 300,000,000 shares of preferred stock, par value $0.01 per share. |
• | restricting dividends in respect of our common stock; |
• | diluting the voting power of our common stock or providing that holders of preferred stock have the right to vote on matters as a class; |
• | impairing the liquidation rights of our common stock; or |
• | delaying or preventing a change of control of us. |
• | a number of directors equal to a majority of the OMH board of directors, plus one director, who are designated by the Acquisition Entity, for so long as the Acquisition Entity directly or indirectly beneficially owns, together with its Permitted Transferees, at least 33% of our voting power; |
• | a number of directors equal to a majority of the OMH board of directors, minus one director, who are designated by the Acquisition Entity, for so long as the Acquisition Entity directly or indirectly |
• | a number of directors (rounded up to the nearest whole number) that would be required to maintain the Acquisition Entity’s proportional representation on the OMH board of directors who are designated by the Acquisition Entity for so long as the Acquisition Entity directly or indirectly beneficially owns, together with its Permitted Transferees, less than 20% but at least 10% of our voting power, provided that if the OMH board of directors consists of six or fewer directors, then the Acquisition Entity shall have the right to designate two directors; and |
• | a number of directors (rounded up to the nearest whole number) that would be required to maintain the Acquisition Entity’s proportional representation on the OMH board of directors who are designated by the Acquisition Entity for so long as the Acquisition Entity directly or indirectly beneficially owns, together with its Permitted Transferees, less than 10% but at least 5% of our voting power, provided that if the OMH board of directors consists of six or fewer directors, then the Acquisition Entity shall have the right to designate one director. |
• | the Acquisition Entity’s status as an equity holder of the Company; |
• | the ownership or the operation of our assets or properties and the operation or conduct of our business; and |
• | any other activities we engage in. |
• | prior to such time, our board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; |
• | upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of our outstanding voting stock at the time the transaction commenced, excluding certain shares; or |
• | at or subsequent to that time, the business combination is approved by our board of directors and authorized at an annual or special meeting of stockholders and not by written consent by the affirmative vote of holders of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder. |
• | any breach of the director’s duty of loyalty to us or our stockholders; |
• | intentional misconduct or a knowing violation of law; |
• | liability under Delaware corporate law for an unlawful payment of dividends or an unlawful stock purchase or redemption of stock; or |
• | any transaction from which the director derives an improper personal benefit. |
• | The Acquisition Entity and its affiliates have the right to and have no duty to abstain from, exercising such right to, engage or invest in the same or similar business as us, do business with any of our clients, customers or vendors or employ or otherwise engage any of our officers, directors or employees; |
• | if the Acquisition Entity or any of its affiliates or any of their officers, directors or employees acquire knowledge of a potential transaction that could be a corporate opportunity, they have no duty to offer such corporate opportunity to us, our stockholders or affiliates; |
• | we have renounced any interest or expectancy in, or in being offered an opportunity to participate in, such corporate opportunities; and |
• | all outstanding depositary shares to which it relates have been redeemed or converted; or |
• | the depositary has made a final distribution to the holders of the depositary shares issued under the deposit agreement upon our liquidation, dissolution or winding up. |
• | the title of the warrants; |
• | the designation, amount and terms of the securities for which the warrants are exercisable; |
• | the designation and terms of the other securities, if any, with which the warrants are to be issued and the number of warrants issued with each other security; |
• | the price or prices at which the warrants will be issued; |
• | the aggregate number of warrants; |
• | any provisions for adjustment of the number or amount of securities receivable upon exercise of the warrants or the exercise price of the warrants; |
• | the price or prices at which the securities purchasable upon exercise of the warrants may be purchased; |
• | if applicable, the date on and after which the warrants and the securities purchasable upon exercise of the warrants will be separately transferable; |
• | if applicable, a discussion of the material U.S. federal income tax considerations applicable to the exercise of the warrants; |
• | any other terms of the warrants, including terms, procedures and limitations relating to the exchange and exercise of the warrants; |
• | the date on which the right to exercise the warrants will commence, and the date on which the right will expire; |
• | the maximum or minimum number of warrants that may be exercised at any time; and |
• | information with respect to book-entry procedures, if any. |
• | directly to one or more purchasers; |
• | through agents; |
• | to or through underwriters, brokers or dealers; or |
• | through a combination of any of these methods. |
• | a block trade in which a broker-dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order to facilitate the transaction; |
• | purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account; |
• | ordinary brokerage transactions and transactions in which a broker solicits purchasers; or |
• | privately negotiated transactions. |
• | enter into transactions with a broker-dealer or affiliate thereof in connection with which such broker-dealer or affiliate will engage in short sales of the common stock pursuant to this prospectus, in which case such broker-dealer or affiliate may use shares of common stock received from us to close out its short positions; |
• | sell securities short and redeliver such shares to close out our short positions; |
• | enter into option or other types of transactions that require us to deliver common stock to a broker-dealer or an affiliate thereof, who will then resell or transfer the common stock under this prospectus; or |
• | loan or pledge the common stock to a broker-dealer or an affiliate thereof, who may sell the loaned shares or, in an event of default in the case of a pledge, sell the pledged shares pursuant to this prospectus. |
• | the name or names of any underwriters or agents and the amounts of securities underwritten or purchased by each of them, if any, and any obligations in relation thereto; |
• | the public offering price or purchase price of the securities and the net proceeds to be received by us from the sale; |
• | any delayed delivery arrangements; |
• | any underwriting discounts or agency fees and other items constituting underwriters’ or agents’ compensation; |
• | any discounts or concessions allowed or reallowed or paid to dealers; and |
• | any securities exchange or markets on which the securities may be listed. |
• | at a fixed price or prices, which may be changed; |
• | at market prices prevailing at the time of sale; |
• | at prices related to the prevailing market prices; or |
• | at negotiated prices. |
• | transfer its common stock in other ways not involving market maker or established trading markets, including directly by gift, distribution, or other transfer; |
• | sell its common stock under Rule 144 or Rule 145 of the Securities Act rather than under this prospectus, if the transaction meets the requirement of Rule 144 or Rule 145; or |
• | sell its common stock by any other legally available means. |
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