UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 22, 2015
RESTAURANT BRANDS INTERNATIONAL INC.
RESTAURANT BRANDS INTERNATIONAL LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
| Canada Ontario |
001-36786 001-36787 |
98-1202754 98-1206431 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
Restaurant Brands International Inc.
Restaurant Brands International Limited Partnership
226 Wyecroft Road
Oakville, Ontario L6K 3X7
(Address of principal executive offices, including Zip Code)
(905) 845-6511
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. Entry into a Material Definitive Agreement.
Indenture
Overview
On May 22, 2015, 1011778 B.C. Unlimited Liability Company, an unlimited liability company organized under the laws of British Columbia (the “Issuer”), and New Red Finance, Inc., a Delaware corporation and a direct wholly owned subsidiary of the Issuer (the “Co-Issuer” and, together with the Issuer, the “Issuers”), each a subsidiary of Restaurant Brands International Inc., a corporation organized under the laws of Canada (the “Company”), entered into an indenture (the “Indenture”), by and among the Issuers, the guarantors party thereto (the “Guarantors”) and Wilmington Trust, National Association, as trustee and as collateral agent, in connection with the issuance and sale by the Issuers to J.P. Morgan Securities LLC and certain other initial purchasers of $1.25 billion aggregate principal amount of 4.625% First Lien Senior Secured Notes due 2022 (the “Notes”). Proceeds from the issuance of the Notes, together with cash on hand, were used to repay approximately $1,550 million of the outstanding borrowings under the Issuers’ term loan facility (the “Term Loan Facility”) and to pay related premiums, fees and expenses.
Interest; Ranking; Guarantees; Security
The Notes will mature on January 15, 2022, and bear interest at a rate of 4.625% per annum, payable semi-annually in cash in arrears on January 15 and July 15 of each year, beginning on July 15, 2015.
The Notes are first lien senior secured obligations and rank (i) equal in right of payment with all of the Issuers’ existing and future senior debt, including borrowings under the Issuers’ Term Loan Facility and revolving credit facility (together with the Term Loan Facility, the “Senior Secured Credit Facilities”) and the Issuers’ 6.00% Second Lien Senior Secured Notes due 2022 (the “Second Lien Notes”); (ii) equal in right of payment with all of the Issuers’ existing and future first-priority senior secured debt, including the borrowings under the Issuers’ Senior Secured Credit Facilities, to the extent of the value of the collateral securing such debt; (iii) effectively senior in the right of payment to all of the Issuers’ existing and future unsecured senior debt and junior lien debt, including the Second Lien Notes, to the extent of the value of collateral securing the Notes; (iv) senior in right of payment to all of the Issuers’ existing and future subordinated debt; and (v) structurally subordinated to all existing and future liabilities of the Issuers’ non-guarantor subsidiaries.
The Notes are guaranteed (the “Guarantees”) fully and unconditionally, and jointly and severally on a senior secured basis by each of the Issuers’ wholly owned restricted subsidiaries that guarantee the Issuers’ obligations under certain credit facilities (including the Senior Secured Credit Facilities).
The Guarantees will be the Guarantors’ first-priority senior secured obligations and will be (i) equal in right of payment with all of such Guarantors’ existing and future senior debt, including borrowings under and guarantees of the Issuers’ Senior Secured Credit Facilities, guarantees in respect of the Second Lien Notes and the existing notes of The TDL Group Corp. (the ultimate successor to Tim Hortons Inc.) (the “THI Notes”); (ii) equal in right of payment with all of such Guarantors’ existing and future first-priority senior secured debt, including the THI Notes and borrowings under and guarantees of the Issuers’ Senior Secured Credit Facilities, to the extent of the value of the collateral securing such debt; (iii) effectively senior to all of such Guarantors’ existing and future unsecured senior debt and junior lien debt, including guarantees in respect of the Second Lien Notes, to the extent of the value of the collateral securing the guarantees; and (iv) senior in right of payment to all of such Guarantors’ existing and future subordinated debt.
Optional Redemption
The Issuers may redeem some or all of the Notes at any time prior to October 1, 2017 at a price equal to 100% of the principal amount of the Notes redeemed plus a “make whole” premium and, at any time on or after October 1, 2017, at the redemption prices set forth in the Indenture. In addition, at any time prior to October 1, 2017, up to 40% of the aggregate principal amount of the Notes may be redeemed with the net proceeds of certain equity offerings, at the redemption price specified in the Indenture.
In connection with any tender offer for the Notes, including a change of control offer or an asset sale offer, the Issuer will have the right to redeem the Notes at a redemption price equal to the amount offered in that tender offer if holders of not less than 90% in aggregate principal amount of the outstanding Notes validly tender and do not withdraw such Notes in such tender offer.
Change of Control
If the Issuer experiences a change of control, the holders of the Notes will have the right to require the Issuers to offer to repurchase the Notes at a purchase price equal to 101% of their aggregate principal amount plus accrued and unpaid interests and Additional Amounts (as defined in the Indenture), if any, to the date of such repurchase.
Covenants and Events of Default
The terms of the Indenture, among other things, limit the ability of the Issuers and their restricted subsidiaries to (i) incur additional indebtedness or guarantee indebtedness; (ii) create liens or use assets as security in other transactions; (iii) declare or pay dividends, redeem stock or make other distributions to stockholders; (iv) make investments; (v) merge, amalgamate or consolidate, or sell, transfer, lease or dispose of substantially all of the Issuers’ assets; (vi) enter into transactions with affiliates; (vii) sell or transfer certain assets; and (viii) agree to certain restrictions on the ability of restricted subsidiaries to make payments to us. These covenants are subject to a number of important qualifications, limitations and exceptions that are described in the Indenture.
The Indenture provides for customary events of default (subject in certain cases to customary grace and cure periods), which include payment defaults, a failure to pay certain judgments and certain events of bankruptcy and insolvency. These events of default are subject to a number of important qualifications, limitations and exceptions that are described in the Indenture.
The foregoing summary of the Indenture does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Indenture, filed as Exhibit 4.1 hereto, and the form of Notes, filed as Exhibit 4.2 hereto, each of which is incorporated herein by reference.
Amendment No. 1 to the Credit Agreement
On May 22, 2015, the Issuers entered into a first amendment (the “Amendment”) to the Credit Agreement dated as of October 27, 2014 (the “Credit Agreement”), by and among the Issuers, 1013421 B.C. Unlimited Liability Company, as holdings, the Guarantors, the lenders party thereto (the “Lenders”) and JPMorgan Chase Bank, N.A., as administrative agent. The Amendment amends the Credit Agreement and the Issuers’ Senior Secured Credit Facilities to, among other things, reduce the interest rate applicable to the Term Loan Facility to, at the Issuers’ option, either (i) a base rate plus an applicable margin equal to 1.75% or (ii) a Eurocurrency rate plus an applicable margin equal to 2.75%. Borrowings under the Term Loan Facility will be subject to a floor of 1.00% in the case of Eurocurrency loans. For a description of the Credit Agreement, see the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 2, 2015.
The foregoing summary of the Amendment does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Amendment, filed as Exhibit 10.1 hereto and incorporated herein by reference.
Certain Relationships
The initial purchasers and their affiliates and the Lenders and their affiliates from time to time have provided in the past and may provide in the future various financial advisory, investment banking and other commercial lending services in the ordinary course of business to the Company and its affiliates. In addition, affiliates of certain of the initial purchasers are lenders and/or agents under the Senior Secured Credit Facilities and as such are entitled to certain fees and expenses in connection therewith and may receive a portion of the proceeds of the Notes offering in connection with the repayment of a portion of the Senior Secured Credit Facilities.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information included in Item 1.01 of this Current Report is incorporated by reference into this Item 2.03.
Item 8.01 Other Events
On May 22, 2015, the Company issued a press release to announce the closing of the offering of the Notes and the refinancing of the Senior Secured Credit Facilities. A copy of the press release is attached hereto as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
| (d) | Exhibits. |
| Exhibit |
Description | |
| 4.1 | Indenture, dated as of May 22, 2015, by and among 1011778 B.C. Unlimited Liability Company, as issuer, New Red Finance, Inc., as co-issuer, the guarantors from time to time party thereto and Wilmington Trust, National Association, as trustee and collateral agent. | |
| 4.2 | Form of 4.625% Senior Notes due 2022 (included as Exhibit A to Exhibit 4.1). | |
| 10.1 | Amendment No. 1, dated May 22, 2015, to the Credit Agreement dated as of October 27, 2014, among 1011778 B.C. Unlimited Liability Company, an unlimited liability company organized under the laws of British Columbia, New Red Finance, Inc., a Delaware corporation, 1013421 B.C. Unlimited Liability Company, an unlimited liability company organized under the laws of British Columbia, the other guarantors party thereto, JPMorgan Chase Bank, N.A., as administrative agent, collateral agent and swing line lender and each L/C issuer and lender from time to time party thereto. | |
| 99.1 | Press release dated May 22, 2015. | |
SIGNATURES
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.
| RESTAURANT BRANDS INTERNATIONAL INC. RESTAURANT BRANDS INTERNATIONAL LIMITED PARTNERSHIP, by its general partner RESTAURANT BRANDS INTERNATIONAL INC. | ||||||
| /s/ Jill Granat | ||||||
| Date: May 26, 2015 | Name: | Jill Granat | ||||
| Title: | General Counsel and Corporate Secretary | |||||
INDEX TO EXHIBITS
| Exhibit |
Description | |
| 4.1 | Indenture, dated as of May 22, 2015, by and among 1011778 B.C. Unlimited Liability Company, as issuer, New Red Finance, Inc., as co-issuer, the guarantors from time to time party thereto and Wilmington Trust, National Association, as trustee and collateral agent. | |
| 4.2 | Form of 4.625% Senior Notes due 2022 (included as Exhibit A to Exhibit 4.1). | |
| 10.1 | Amendment No. 1, dated May 22, 2015, to the Credit Agreement dated as of October 27, 2014, among 1011778 B.C. Unlimited Liability Company, an unlimited liability company organized under the laws of British Columbia, New Red Finance, Inc., a Delaware corporation, 1013421 B.C. Unlimited Liability Company, an unlimited liability company organized under the laws of British Columbia, the other guarantors party thereto, JPMorgan Chase Bank, N.A., as administrative agent, collateral agent and swing line lender and each L/C issuer and lender from time to time party thereto. | |
| 99.1 | Press release dated May 22, 2015. | |