| Item 1.01. | Entry into a Material Definitive Agreement |
In connection with the initial public offering by Reynolds Consumer Products Inc. (the “Company”) of its common stock, par value $0.001 per share (the “Common Stock”), described in the Registration Statement on FormS-1 (FileNo. 333-234731), as amended (the “Registration Statement”), the following agreements were entered into:
| | • | | Registration Rights Agreement dated February 4, 2020, between the Company and Packaging Finance Limited (“PFL”) (the “Registration Rights Agreement”); |
| | • | | Stockholders Agreement dated February 4, 2020, between the Company and PFL (the “Stockholders Agreement”); |
| | • | | Tax Matters Agreement dated February 4, 2020 among the Company, Reynolds Group Holdings Limited and Reynolds Group Holdings Inc. (the “Tax Matters Agreement”); |
| | • | | Credit Agreement dated February 4, 2020, by and among the Company, as parent, Reynolds Consumer Products LLC, as borrower, Credit Suisse AG, Cayman Islands Branch, as administrative agent, and certain lenders from time to time party thereto (the “Credit Agreement”); |
| | • | | Transition Services Agreement, dated February 4, 2020 between the Company and Reynolds Group Holdings Inc. (the “RGHI TSA”); and |
| | • | | Transition Services Agreement, dated January 22, 2020 between the Company and Rank Group Limited. (the “Rank TSA”). |
The Registration Rights Agreement, the Stockholders Agreement, the Tax Matters Agreement, the Credit Agreement, the RGHI TSA and the Rank TSA are filed herewith as Exhibits 10.1, 10.2, 10.3, 10.4, 10.5 and 10.6 respectively, and are incorporated herein by reference. The terms of these agreements are substantially the same as the terms described in the Registration Statement.
As described in Item 2.03 below, on February 4, 2020, the Company and Reynolds Consumer Products LLC entered into the Credit Agreement. The disclosure provided in Item 2.03 of this Current Report on Form8-K is hereby incorporated by reference into this Item 1.01.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under anOff-Balance Sheet Arrangement of a Registrant. |
On February 4, 2020, the Company, as parent, and Reynolds Consumer Products LLC, as borrower (the “Borrower”) entered into a Credit Agreement with Credit Suisse AG, Cayman Islands Branch, as administrative agent, and certain lenders from time to time party thereto (the “Credit Agreement”), which provides for a $2,475 million senior secured term loan facility (the “New Term Loan Facility”) and a $250 million senior secured revolving facility (the “New Revolving Facility,” and together with the New Term Loan Facility, the “New Credit Facilities”).
The New Revolving Facility includes asub-facility for letters of credit. In addition, the New Credit Facilities provide the Borrower with the right at any time, subject to customary conditions, to request incremental term loans or incremental revolving credit commitments.
Borrowings under the New Credit Facilities bear interest at a rate per annum equal to (i) in the case of LIBO Rate Borrowings, LIBO Rate plus 1.75% and (ii) in the case of ABR Borrowings, base rate plus 0.75%.
All obligations under the New Credit Facilities are guaranteed by the Company and are secured, subject to permitted liens and other exceptions, by a perfected first-priority pledge of all equity interests of each domestic wholly-owned material restricted subsidiary of the Company, the Borrower or a subsidiary guarantor, and perfected first-priority security interests in substantially all tangible and intangible personal property of the Company, the Borrower and the subsidiary guarantors.
The New Credit Facilities contain a number of covenants that, among other things, restrict the Company’s ability to:
| | • | | incur or guarantee additional debt and issue certain equity securities; |
