On November 2, 2020, Philip Morris International Inc. (“PMI”) issued US$750,000,000 aggregate principal amount of its 0.875% Notes due 2026 (the “2026 Notes”) and US$750,000,000 aggregate principal amount of its 1.750% Notes due 2030 (the “2030 Notes” and, together with the 2026 Notes, the “Notes”). The Notes were issued pursuant to an Indenture dated as of April 25, 2008, by and between PMI and HSBC Bank USA, National Association, as trustee.
In connection with the issuance of the Notes, on October 29, 2020 PMI entered into a Terms Agreement (the “Terms Agreement”) with Barclays Capital Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. LLC, HSBC Securities (USA) Inc., Santander Investment Securities Inc. and SG Americas Securities, LLC, as representatives of the several underwriters named therein (the “Underwriters”), pursuant to which PMI agreed to issue and sell the Notes to the Underwriters. The provisions of an Underwriting Agreement, dated as of April 25, 2008 (the “Underwriting Agreement”), are incorporated by reference in the Terms Agreement.
PMI has filed with the Securities and Exchange Commission a Prospectus dated February 11, 2020 and a Prospectus Supplement (the “Prospectus Supplement”) dated October 29, 2020 (Registration No. 333-236366) in connection with the public offering of the Notes.
The Notes are subject to certain customary covenants, including limitations on PMI’s ability, with significant exceptions, to incur debt secured by liens and engage in sale/leaseback transactions. PMI may redeem the Notes, in whole or in part, at the applicable redemption prices described in the Prospectus Supplement, plus accrued and unpaid interest thereon to, but excluding, the applicable redemption date. PMI may also redeem all, but not part, of the Notes of each series upon the occurrence of specified tax events as described in the Prospectus Supplement.
Interest on the 2026 Notes is payable from November 2, 2020 semiannually in arrears on May 1 and November 1, commencing May 1, 2021, to holders of record on the preceding April 15 and October 15, as the case may be. Interest on the 2030 Notes is payable from November 2, 2020 semiannually in arrears on May 1 and November 1, commencing May 1, 2021, to holders of record on the preceding April 15 and October 15, as the case may be.
The 2026 Notes will mature on May 1, 2026 and the 2030 Notes will mature on November 1, 2030.
The Notes will be PMI’s senior unsecured obligations and will rank equally in right of payment with all of its existing and future senior unsecured indebtedness.
For a complete description of the terms and conditions of the Underwriting Agreement, the Terms Agreement and the Notes, please refer to such agreements and the form of Notes, each of which is incorporated herein by reference and is an exhibit to this report as Exhibits 1.1, 1.2, 4.1 and 4.2, respectively.
Certain of the Underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory, commercial and investment banking services for PMI, for which they received or will receive customary fees and expenses. Certain of the Underwriters and their respective affiliates are lenders under PMI’s credit facilities. PMI and some of its subsidiaries may enter into foreign exchange and other derivative arrangements with certain of the Underwriters or their respective affiliates. In addition, certain of the Underwriters or their respective affiliates act as dealers in connection with PMI’s commercial paper programs.
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