| Item 1.01 | Entry into a Material Definitive Agreement. |
On October 7, 2020, Conagra Brands, Inc. (the “Company”) agreed to sell $1,000,000,000 aggregate principal amount of its 1.375% Senior Notes due 2027 (the “Notes”) pursuant to an underwriting agreement, dated October 7, 2020 (the “Underwriting Agreement”), by and among the Company and BofA Securities, Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC and Mizuho Securities USA LLC, acting as representatives of the several underwriters named therein. The offering of the Notes was registered under the Securities Act of 1933, as amended, pursuant to the Company’s Registration Statement on Form S-3 (Registration No. 333-227740). A prospectus supplement relating to the offering and sale of the Notes was filed with the Securities and Exchange Commission on October 8, 2020.
The terms of the Notes will be governed by an indenture, dated as of October 12, 2017 (the “Base Indenture”), as supplemented by a supplemental indenture, dated as of October 16, 2020 (the “Third Supplemental Indenture” and, collectively with the Base Indenture, the “Indenture”), in each case by and between the Company and Wells Fargo Bank, National Association, as trustee. The Indenture contains customary covenants that, among other things, limit the ability of the Company, with certain exceptions, to incur debt secured by liens, engage in sale and leaseback transactions and enter into certain consolidations, mergers and transfers of all or substantially all of the assets of the Company and its subsidiaries, taken as a whole.
The Company may redeem some or all of the Notes at any time and from time to time prior to their maturity at the redemption prices described in the prospectus supplement. Upon the occurrence of a “Change of Control Triggering Event,” as defined in the Third Supplemental Indenture, the Company will be required to offer to repurchase the Notes at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase.
The Indenture contains customary events of default, including failure to make required payments of principal and interest, certain events of bankruptcy and insolvency and default in the performance or breach of any covenant or warranty contained in the Indenture or the Notes.
The Notes will mature on November 1, 2027 and bear interest at a rate equal to 1.375% per year, commencing on May 1, 2021.
The Notes will be senior unsecured obligations of the Company and rank equally in right of payment with all of its other senior unsecured debt, are effectively junior to any of the Company’s secured debt to the extent of the value of collateral securing such debt, and are effectively junior to all existing and future secured and unsecured debt of the Company’s subsidiaries.
The underwriters and their affiliates have provided, are currently providing and in the future may continue to provide investment banking, commercial banking and other financial services, including the provision of credit facilities, to the Company in the ordinary course of business for which they have received and will receive customary compensation.
The foregoing description of the Indenture is qualified in its entirety by reference to the full text of the Base Indenture and the Third Supplemental Indenture, copies of which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The description contained under Item 1.01 above is hereby incorporated by reference in its entirety into this Item 2.03.
