8-KFinancial EventsExhibits & Filings

Mondelez International, Inc. 8-K Report, Financial Obligation (Sep 20, 2019)

Filed September 20, 2019For Securities:MDLZ

Summary

Mondelēz International, Inc. (MDLZ) reported through its wholly-owned Dutch subsidiary, Mondelez International Holdings Netherlands B.V. (MIHNBV), the issuance of $1 billion in aggregate principal amount of debt securities. This issuance comprises $500 million of 2.125% Notes due 2022 and $500 million of 2.250% Notes due 2024. The notes are guaranteed by the parent company, Mondelēz International, Inc., on a senior unsecured basis. The transaction was conducted in a private placement, exempt from Securities Act registration requirements. These new notes are intended to further diversify the company's funding sources and manage its capital structure. The covenants associated with these notes are generally consistent with existing debt agreements, including restrictions on liens, sale and leaseback transactions, and asset transfers. A specific provision allows for a purchase offer at 101% of principal if a change of control event coincides with a rating downgrade below investment grade. Investors should note the notes are subject to transfer restrictions.

Key Highlights

  • 1Issuance of $1 billion in new debt: $500 million of 2.125% Notes due 2022 and $500 million of 2.250% Notes due 2024.
  • 2The new debt is issued by a wholly-owned Dutch subsidiary (MIHNBV) and guaranteed by the parent company (MDLZ) on a senior unsecured basis.
  • 3The issuance was conducted as a private placement, exempt from registration under the Securities Act.
  • 4Interest payments are semi-annual, due on March 19 and September 19 each year.
  • 5Covenants include customary restrictions on liens, sale and leaseback transactions, and asset disposals.
  • 6A change of control provision requires a 101% purchase offer if combined with a sub-investment grade rating downgrade.
  • 7The notes are subject to transferability and resale restrictions.

Frequently Asked Questions

While the specific use of proceeds is not detailed in this filing, such issuances are typically used for general corporate purposes, which can include funding operations, capital expenditures, acquisitions, or refinancing existing debt. This issuance likely serves to diversify funding and manage the company's capital structure.

If Mondelēz International, Inc. undergoes a change of control event AND the notes are downgraded below investment grade by both Moody's and S&P within a specified timeframe, the issuer (MIHNBV) must offer to repurchase the notes at 101% of their principal amount plus accrued interest. This provides some protection to noteholders in adverse scenarios.

No, these notes were issued in a transaction exempt from registration under the Securities Act of 1933. They are not registered and are subject to restrictions on transferability and resale, indicating they are not intended for broad public trading.

The primary financial obligation is the repayment of $1 billion in principal for the 2022 and 2024 notes, along with semi-annual interest payments at the stated rates (2.125% and 2.250% respectively). The parent company guarantees these obligations.