Page 7 of 9 – SEC Filing Page 7 of 9 Pages Anchorage also agreed to certain customary standstill provisions, effective as of the date of the Agreement, that will apply during the Stockholder Designee’s (or a replacement designee’s) tenure on the Board and at least until 30 days prior to the expiration of the Issuer’s advance notice period for the nomination of directors at the Issuer’s 2018 annual meeting of stockholders (the “Restricted Period”). The standstill provisions generally include, among other things and with certain carve-outs, restrictions on: (i) soliciting proxies or initiating a stockholder proposal with respect to the Issuer; (ii) forming or influencing any “group” (as defined pursuant to Section 13(d) of the Act) with respect to securities of the Issuer; (iii) acquiring additional Shares where it would result in Capital Group beneficially owning more than 20% of the Shares outstanding; (iv) other than in an underwritten widely dispersed public offering, knowingly transferring Shares to any person or group that would beneficially own more than 10% of the Shares outstanding as a result of such transfer; (v) making disparaging public statements regarding the Issuer or its affiliates (with the Issuer agreeing to a reciprocal restriction) or making public proposals regarding changes in the Issuer’s business or financial condition; and (vi) initiating legal proceedings against the Issuer or requesting inspection of the Issuer’s corporate books and records. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.
Item 6 of the Schedule 13D is hereby restated in its entirety as follows: The responses to Item 3 and Item 4 of the Schedule 13D are incorporated by reference herein. In connection with the Restructuring, on June 22, 2012, Anchorage and other shareholders entered into an Investor Rights Agreement (the “Investor Rights Agreement”) with the Issuer which contained, among others, provisions granting certain registration rights and provisions related to confidentiality, holdback agreements and the Issuer’s reporting obligations. This description of the Investor Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of such document, which is included as Exhibit C to the Schedule 13D and is incorporated by reference herein. ACMO and PCI Fund are lenders to the Issuer pursuant to the Amended Term Loan Credit Agreement described below. On May 29, 2015, in connection with the acquisition by the Issuer of certain assets comprising the Educational Technology and Services business of Scholastic Corporation and its wholly-owned subsidiary, Scholastic Inc. (the “Acquisition”), certain investment vehicles to which Capital Group serves as collateral manager and certain other lender parties, acting as lenders, entered into an amended and restated term loan credit agreement (the “Amended Term Loan Credit Agreement”) with the Issuer, certain of its wholly-owned subsidiaries, as borrowers, and Citibank, N.A. as the administrative agent and collateral agent. Pursuant to the terms of the Amended Term Loan Credit Agreement, the outstanding indebtedness under the existing Superpriority Senior Secured Debtor-In-Possession and Exit Term Loan Credit Agreement dated as of May 22, 2012, as amended, was refinanced, and the Issuer obtained additional financing to consummate the Acquisition. Specifically, the Amended Term Loan Credit Agreement increased the Issuer’s outstanding term loan credit facility from $178.9 million to $800.0 million. The Amended Term Loan Credit Agreement matures on May 29, 2021 and the interest rate is based, at the borrowers’ election, on LIBOR (subject to a floor of 1.0%) plus 3.00% or an alternative base rate plus applicable margins. Such investment vehicles subsequently disposed of their interests in the Amended Term Loan Credit Agreement. This description of the Amended Term Loan Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended Term Loan Credit Agreement, which is included as Exhibit D to the Schedule 13D and is incorporated by reference herein. Follow Houghton Mifflin Harcourt Co (NASDAQ:HMHC)
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Page 7 of 9 Pages
Anchorage also agreed to certain customary standstill provisions, effective as of the date of the Agreement, that will apply during the Stockholder Designee’s (or a replacement designee’s) tenure on the Board and at least until 30 days prior to the expiration of the Issuer’s advance notice period for the nomination of directors at the Issuer’s 2018 annual meeting of stockholders (the “Restricted Period”). The standstill provisions generally include, among other things and with certain carve-outs, restrictions on: (i) soliciting proxies or initiating a stockholder proposal with respect to the Issuer; (ii) forming or influencing any “group” (as defined pursuant to Section 13(d) of the Act) with respect to securities of the Issuer; (iii) acquiring additional Shares where it would result in Capital Group beneficially owning more than 20% of the Shares outstanding; (iv) other than in an underwritten widely dispersed public offering, knowingly transferring Shares to any person or group that would beneficially own more than 10% of the Shares outstanding as a result of such transfer; (v) making disparaging public statements regarding the Issuer or its affiliates (with the Issuer agreeing to a reciprocal restriction) or making public proposals regarding changes in the Issuer’s business or financial condition; and (vi) initiating legal proceedings against the Issuer or requesting inspection of the Issuer’s corporate books and records.
| Item 6. | Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. |
Item 6 of the Schedule 13D is hereby restated in its entirety as follows:
The responses to Item 3 and Item 4 of the Schedule 13D are incorporated by reference herein.
In connection with the Restructuring, on June 22, 2012, Anchorage and other shareholders entered into an Investor Rights Agreement (the “Investor Rights Agreement”) with the Issuer which contained, among others, provisions granting certain registration rights and provisions related to confidentiality, holdback agreements and the Issuer’s reporting obligations. This description of the Investor Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of such document, which is included as Exhibit C to the Schedule 13D and is incorporated by reference herein.
ACMO and PCI Fund are lenders to the Issuer pursuant to the Amended Term Loan Credit Agreement described below. On May 29, 2015, in connection with the acquisition by the Issuer of certain assets comprising the Educational Technology and Services business of Scholastic Corporation and its wholly-owned subsidiary, Scholastic Inc. (the “Acquisition”), certain investment vehicles to which Capital Group serves as collateral manager and certain other lender parties, acting as lenders, entered into an amended and restated term loan credit agreement (the “Amended Term Loan Credit Agreement”) with the Issuer, certain of its wholly-owned subsidiaries, as borrowers, and Citibank, N.A. as the administrative agent and collateral agent. Pursuant to the terms of the Amended Term Loan Credit Agreement, the outstanding indebtedness under the existing Superpriority Senior Secured Debtor-In-Possession and Exit Term Loan Credit Agreement dated as of May 22, 2012, as amended, was refinanced, and the Issuer obtained additional financing to consummate the Acquisition. Specifically, the Amended Term Loan Credit Agreement increased the Issuer’s outstanding term loan credit facility from $178.9 million to $800.0 million. The Amended Term Loan Credit Agreement matures on May 29, 2021 and the interest rate is based, at the borrowers’ election, on LIBOR (subject to a floor of 1.0%) plus 3.00% or an alternative base rate plus applicable margins. Such investment vehicles subsequently disposed of their interests in the Amended Term Loan Credit Agreement. This description of the Amended Term Loan Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended Term Loan Credit Agreement, which is included as Exhibit D to the Schedule 13D and is incorporated by reference herein.
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