Item 1.01. Entry into a Material Definitive Agreement.
Indenture and Notes
On December 7, 2020, Shift4
Payments, Inc. (the Company) issued $690,000,000 principal amount of its 0.00% Convertible Senior Notes due 2025, which amount includes the Option Notes (as defined below) (the Notes). The Notes were issued pursuant to, and
are governed by, an indenture (the Indenture), dated as of December 7, 2020, between the Company and U.S. Bank National Association, as trustee (the Trustee). Pursuant to the purchase agreement between the Company and
the initial purchasers of the Notes, the Company granted the initial purchasers an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes are first issued, up to an additional $90,000,000 principal
amount of Notes (the Option Notes). On December 3, 2020, the initial purchasers exercised their option to purchase the Option Notes in full.
The Notes will be the Companys senior, unsecured obligations and will be equal in right of payment with the Companys existing and future senior,
unsecured indebtedness, senior in right of payment to the Companys future indebtedness that is expressly subordinated to the Notes and effectively subordinated to the Companys existing and future secured indebtedness, to the extent of
the value of the collateral securing that indebtedness. The Notes will be structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof)
preferred equity, if any, of the Companys subsidiaries.
The Notes will not bear regular interest, and the principal amount of the Notes will not
accrete. The Notes will mature on December 15, 2025, unless earlier repurchased, redeemed or converted. Before September 15, 2025, noteholders will have the right to convert their Notes only upon the occurrence of certain events. From and
after September 15, 2025, noteholders may convert their Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or
delivering, as applicable, cash, shares of its Class A common stock or a combination of cash and shares of its Class A common stock, at the Companys election. The initial conversion rate is 12.4262 shares of Class A common stock
per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $80.48 per share of Class A common stock. The conversion rate and conversion price will be subject to customary adjustments upon the occurrence
of certain events. In addition, if certain corporate events that constitute a Make-Whole Fundamental Change (as defined in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period
of time.
The Notes will be redeemable, in whole or in part, at the Companys option at any time, and from time to time, on or after
December 20, 2023 and on or before the 40th scheduled trading day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid special interest, if any, to,
but excluding, the redemption date, but only if the last reported sale price per share of the Companys Class A common stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive,
during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (2) the trading day immediately before the date the Company sends such notice. In
addition, calling any Note for redemption will constitute a Make-Whole Fundamental Change with respect to that Note, in which case the conversion rate applicable to the conversion of that Note will be increased in certain circumstances if it is
converted after it is called for redemption and prior to the second business day immediately before the related redemption date.
If certain corporate
events that constitute a Fundamental Change (as defined in the Indenture) occur, then, subject to a limited exception for certain cash mergers, noteholders may require the Company to repurchase their Notes at a cash repurchase price
equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date. The definition of Fundamental Change includes certain business combination
transactions involving the Company and certain de-listing events with respect to the Companys Class A common stock.