SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2020
Commission File Number: 000-38511
(Exact name of registrant as specified in its charter)
Level 18, Sohu.com Media Plaza
Block 3, No. 2 Kexueyuan South Road, Haidian District
Beijing 100190, Peoples Republic of China
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐ No ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐ No ☒
On April 17, 2020, the registrant announced the completion of its previously announced going private transaction with respect to Changyou.com Limited (Changyou) (the Changyou Merger). A copy of the press release issued by the registrant regarding the foregoing is furnished herewith as Exhibit 99.1.
Funds for the registrants consummation of the Changyou Merger are being provided by Industrial and Commercial Bank of China Limited, Tokyo Branch (ICBC Tokyo) pursuant to a facility agreement (the Facility Agreement) entered into as of April 3, 2020 between ICBC Tokyo, the registrants indirect wholly-owned subsidiary Sohu.com (Game) Limited (Sohu Game) as borrower and the registrant as guarantor. The Facility Agreement provides for a term loan facility of up to $250 million (the Term Facility), subject to customary conditions, consisting of (i) a one-year term facility for term loans of up to $100 million (the One-Year Facility) and (ii) a four-year term facility for term loans of up to $150 million (the Four-Year Facility). The outstanding principal amount of the loans under the One-Year Facility will be due in full on the one-year anniversary of the date of the first utilization of the One-Year Facility. The outstanding principal amount of the loans under the Four-Year Facility will be due in installments, with $7.5 million due and payable at the end of each of the second and third calendar years during the term of the Four-Year Facility and the remaining outstanding principal amount due and payable on the fourth anniversary of the date of the first utilization of the One-Year Facility.
The Term Facility bears interest at a rate of LIBOR plus a margin of 1.75%, with Three Month LIBOR to be determined by ICBC on the basis of the London InterBank Offered Rate published two business days before the first day of each three calendar month interest period. Accrued interest will be due every three calendar months on the first day after the end of each such three-month interest period.
The obligations of Sohu Game as borrower under the Term Facility are initially fully guaranteed by the registrant, and are initially secured by first priority share pledges or mortgages over 97.9% of the outstanding equity interests in Changyou. In addition, Sohu Game is required to cause Changyou, within one (1) month after the initial funding under the Term Facility, to pledge a deposit certificate evidencing a Renminbi, the legal currency of China (RMB), deposit equivalent to not less $125 million at an exchange rate of $1.00 = RMB7.20 and, within three months after the initial funding under the Term Facility, to pledge RMB deposit certificates evidencing amounts equivalent to the Facility Agreement amount (including the initial $125 million-equivalent deposit certificate). Upon the effectiveness of such additional pledge, the registrants guarantee and all share pledges or mortgages over the outstanding equity interests in Changyou will be released and discharged.
|99.1||Press Release issued by the registrant on April 17, 2020.|
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.
|Title:||Chief Financial Officer|
Date: April 17, 2020
Sohu.com Announces Completion of Changyou Going-Private Transaction
BEIJING, China, April 17, 2020 Sohu.com Limited (NASDAQ: SOHU) (Sohu), Chinas leading online media, video, search and gaming business group, today announced that it has completed the acquisition of all of the outstanding shares of Changyou.com Limited (Changyou) that it did not already beneficially own, through the merger (the Changyou Merger) of an indirect wholly-owned subsidiary (Changyou Merger Co.) of Sohu with and into Changyou, with Changyou being the company surviving the Changyou Merger. As a result of the Changyou Merger, Changyou has become a private company wholly owned directly and indirectly by Sohu and the American depositary shares of Changyou (the Changyou ADSs), each of which represented two Changyou Class A ordinary shares (Changyou Class A Ordinary Shares), are no longer traded on the Nasdaq Global Select Market.
Pursuant to the plan of merger for the Changyou Merger, each Changyou Class A Ordinary Share issued and outstanding immediately prior to the effectiveness of the Changyou Merger, other than Changyou Class A ordinary shares owned beneficially by Sohu, was cancelled in exchange for the right to receive $5.40 in cash without interest, and each outstanding Changyou ADS was cancelled in exchange for the right to receive $10.80 in cash without interest (less $0.05 per ADS cancellation fees and other fees as applicable). Because Changyou Merger Co. owned over 90% of the voting power represented by all issued and outstanding shares of Changyou prior to the effectiveness of the Changyou Merger and the Changyou Merger was in the form of a short-form merger in accordance with section 233(7) of the Companies Law of the Cayman Islands, the Changyou Merger was not subject to a vote of the shareholders of Changyou.
In connection with the Changyou Merger, each outstanding and fully-vested option (each, a Vested Option) to purchase Changyou Class A Ordinary Shares under Changyous share incentive plans was cancelled, and each holder of a Vested Option has the right to receive an amount in cash determined by multiplying (x) the excess, if any, of $5.40 over the applicable exercise price of such Vested Option by (y) the number of Changyou Class A Ordinary Shares underlying such Vested Option; and each outstanding but unvested option (each, an Unvested Option) to purchase Changyou Class A Ordinary Shares under Changyous share incentive plans will remain outstanding and continue to vest following the effectiveness of the Changyou Merger in accordance with the applicable Changyou share incentive plan and award agreement governing such Unvested Option in effect immediately prior to the effectiveness of the Changyou Merger.
Changyou has requested that trading of Changyou ADSs on the Nasdaq Global Select Market be suspended, and that the Nasdaq Stock Market LLC (Nasdaq) file with the Securities and Exchange Commission (the SEC) a Form 25 notifying the SEC of Nasdaqs withdrawal of the Changyou ADSs from listing on Nasdaq and intention to withdraw the Changyou Class A Ordinary Shares from registration under Section 12(b) of the Securities Exchange Act of 1934, as amended (the Exchange Act). Changyou has informed Sohu that it intends to file with the SEC, ten days after Nasdaq files the Form 25, a Form 15 suspending Changyous reporting obligations under the Exchange Act and withdrawing the registration of Changyou Class A Ordinary Shares under the Exchange Act. Changyous obligations to file with or furnish to the SEC certain reports and forms, including Form 20-F and Form 6-K, will be suspended immediately as of the filing date of the Form 15 and will terminate once the deregistration of Changyou Class A Ordinary Shares becomes effective.
China Renaissance, through its subsidiary CRP-Fanya Investment Consultants (Beijing) Limited, has served as financial advisor to Sohu in connection with the Changyou Merger; Goulston & Storrs PC has served as U.S. legal counsel to Sohu; and Han Kun Law Offices has served as PRC legal counsel to Sohu.
Houlihan Lokey (China) Limited has served as financial advisor to the committee of independent and disinterested directors established by Changyous board of directors (the Changyou Special Committee) to review and evaluate the Changyou Merger; and Skadden, Arps, Slate, Meagher & Flom LLP has served as U.S. legal counsel to the Changyou Special Committee.
Conyers Dill & Pearman has advised as to Cayman Islands legal matters with respect to the Changyou Merger.
Sohu is Chinas premier online brand and indispensable to the daily life of millions of Chinese, providing a network of web properties and community based/web 2.0 products which offer the vast Sohu user community a broad array of choices regarding information, entertainment and communication. Sohu has built one of the most comprehensive matrices of Chinese language web properties and proprietary search engines, consisting of the mass portal and leading online media destination www.sohu.com; interactive search engine www.sogou.com; developer and operator of online games www.changyou.com and the online video website tv.sohu.com.
Sohus corporate services consist of online brand advertising on Sohus matrix of websites as well as bid listing and home page on its in-house developed search directory and engine. Sohu also provides multiple news and information services on mobile platforms, including Sohu News App and the mobile news portal m.sohu.com. Sohus online game subsidiary Changyou develops and operates a diverse portfolio of PC and mobile games, such as Tian Long Ba Bu (TLBB), one of the most popular PC games in China. Changyou also owns and operates the 17173.com Website, a game information portal in China. Sohus online search subsidiary Sogou (NYSE: SOGO) has grown to become the second largest search engine by mobile queries in China. It also owns and operates Sogou Input Method, the largest Chinese language input software. Sohu, established by Dr. Charles Zhang, one of Chinas internet pioneers, is in its twenty-fourth year of operation.
For investor and media inquiries, please contact:
Ms. Pu Huang
Tel: +86 (10) 6272-6645
In the United States:
Ms. Linda Bergkamp
Tel: +1 (480) 614-3004