| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant. |
The information provided in Item 8.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
| Item 7.01. | Regulation FD Disclosure |
On March 9, 2021, Flowers Foods, Inc. (the “Company”) instructed Wells Fargo Bank, National Association (the “Trustee”), the trustee for the Company’s 4.375% Notes due 2022 (the “2022 Notes”), to deliver a notice of redemption to the holders of the 2022 Notes. Pursuant to the notice of redemption, the Company will redeem the entire aggregate principal amount of the 2022 Notes currently issued and outstanding under the Indenture, in accordance with the terms for redemption contained in the Indenture. The Company will redeem the 2022 Notes, which are subject to a customary make-whole premium, on April 9, 2021 for a redemption price set forth in the redemption notice.
On March 2, 2021, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with BofA Securities, Inc. and Deutsche Bank Securities Inc., as representatives of the several underwriters named therein, in connection with the offer and sale of the Company’s 2.400% Senior Notes due 2031 (the “Notes”). The Underwriting Agreement includes the terms and conditions of the offer and sale of the Notes, indemnification and contribution obligations and other terms and conditions customary in agreements of this type. The Company will use the net proceeds from this offering to redeem its outstanding 2022 Notes and the balance of the net proceeds for general corporate purposes.
Some of the underwriters and their affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings in the ordinary course of business with us. They have received customary fees and commissions for these transactions. In particular, affiliates of Deutsche Bank Securities Inc., BofA Securities, Inc. and certain other underwriters are parties to, and lenders under, our existing revolving credit facility. Our existing revolving credit facility was negotiated on an arms’ length basis and contains customary terms pursuant to which the lenders receive customary fees.
The Notes were issued under an indenture, dated as of April 3, 2012 (the “Indenture”), by and between the Company, as issuer, and the Trustee. The terms and conditions of the Notes were established pursuant to, and are set forth in, the Officer’s Certificate of the Company (the “Officer’s Certificate”) and the form of 2.400% Senior Notes due 2031 (“Form of Note”), which are attached hereto as Exhibit 4.2 and Exhibit 4.3, respectively.
The Company will pay interest on the Notes on each March 15 and September 15, beginning on September 15, 2021. The Notes will mature on March 15, 2031. Before December 15, 2030, the Company may, at any time, redeem the Notes at a redemption price equal to 100% of the principal amount of such series, plus a “make-whole” premium described in the Indenture. On or after December 15, 2030, the Company may redeem the Notes at par, plus accrued and unpaid interest.
If a change of control triggering event (as defined in the Form of Note) occurs, unless we have exercised our option to redeem the Notes, we will be required to make an offer to each holder of the Notes to repurchase all or any part (equal to a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof) of such Holder’s notes. In a change of control offer, we will be required to offer payment in cash equal to 101% of the aggregate principal amount of the notes plus unpaid interest, if any, accrued to, but not including, the date of repurchase, subject to the rights of holders of notes on a record date to receive interest due to the related interest payment date.
The Notes are subject to the covenants in the Indenture and Officer’s Certificate, which include certain limitations on liens, sale and leaseback transactions, sales of assets, mergers and consolidations.
The Indenture contains customary events of default, including: (i) failure to pay principal or premium, if any, on any Note when due; (ii) failure to pay any interest on any Note for 30 days after the interest becomes due; (iii) failure to perform or breach of any other covenant in the Indenture for 60 days after written notice thereof; (iv) certain defaults under any mortgage, indenture or instrument of the Company securing or evidencing the Company’s indebtedness; and (v) specified events of bankruptcy, insolvency or reorganization involving the Company or any significant subsidiary (or group of subsidiaries that, taken together, would constitute a significant subsidiary) of the Company.
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