| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
As previously disclosed, on October 9, 2020, Garrett Motion Inc. (the “Company”) and certain of its subsidiaries (collectively, the “Debtors”) entered into a Senior Secured Super-Priority Debtor-in-Possession Credit Agreement, as amended on October 12, 2020 (the “DIP Credit Agreement”), with the lenders party thereto and Citibank N.A. as administrative agent.
On October 26, 2020, the Company borrowed a $100 million delayed draw loan under the DIP Credit Agreement. The delayed draw borrowing was available after the Company received final approval for the DIP Credit Agreement pursuant to an order of the United States Bankruptcy Court for the Southern District of New York on October 23, 2020 (the “Final Order”). In addition to granting final approval for the DIP Credit Agreement, the Final Order reduced the delayed draw commitment available under the DIP Credit Agreement from $150 million to $100 million, which reduced the total capacity under the DIP Credit Agreement from $250 million to $200 million. Following the delayed draw borrowing on October 26, the Company has $200 million of loans outstanding under the DIP Credit Agreement and no remaining unfunded commitments.
Cautionary Information Regarding Trading in the Company’s Securities.
As previously disclosed, on September 20, 2020, the Debtors filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code in the Bankruptcy Court (the “Chapter 11 Cases”). The Company’s securityholders are cautioned that trading in the Company’s securities during the pendency of the Chapter 11 Cases is highly speculative and poses substantial risks. Trading prices for the Company’s securities may bear little or no relationship to the actual recovery, if any, by holders thereof in the Company’s Chapter 11 Cases. Accordingly, the Company urges extreme caution with respect to existing and future investments in its securities.
Forward-Looking Statements
This Current Report on Form 8-K contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of fact, that address activities, events or developments that the Company or the Company’s management intend, expect, project, believe or anticipate will or may occur in the future are forward-looking statements including without limitation the Company’s statements regarding the Company’s Chapter 11 process. Although the Company believes forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results or performance of the company to be materially different from any future results or performance expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to those described in the Company’s annual report on Form 10-K for the year ended December 31, 2019, as updated by the Company’s quarterly report on Form 10-Q for the period ended June 30, 2020, as well as the Company’s other filings with the Securities and Exchange Commission, under the headings “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements.” You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document. Forward-looking statements are not guarantees of future performance, and actual results, developments and business decisions may differ from those envisaged by the Company’s forward-looking statements.
