capital and other general corporate purposes. Simultaneously with its entry into the New 364-Day Credit Agreement, KDP intends to terminate the commitments
under its existing 364-day credit agreement, dated as of April 14, 2020 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the Existing 364-Day Credit Agreement), by and among KDP, as borrower, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent.
The interest rate applicable to borrowings under the New 364-Day Credit Facility is expected to range
from a rate equal to LIBOR plus a margin of 1.000% to 1.625% or a base rate plus a margin of 0.000% to 0.625%, depending on the rating of senior, unsecured, long-term indebtedness for borrowed money of KDP that is not guaranteed by any other person
(other than, for the avoidance of doubt, a subsidiary of KDP) or subject to any other credit enhancement. KDP is expected to also be obligated to pay a commitment fee on the unused commitments under the New
364-Day Credit Facility at a rate ranging from 0.080% to 0.225% of such unused commitments, depending on the rating of senior, unsecured, long-term indebtedness for borrowed money of KDP that is not guaranteed
by any other person (other than, for the avoidance of doubt, a subsidiary of KDP) or subject to any other credit enhancement. The commitments under the New 364-Day Credit Facility are expected to terminate 364
days from the effectiveness of the facility (the Termination Date), subject to KDPs option to extend the maturity date by one year so long as certain customary conditions are satisfied to convert any revolving loans outstanding on
the Termination Date into term loans.
The New 364-Day Credit Facility is expected to contain
customary representations and warranties for investment grade financings. The New 364-Day Credit Facility is also expected to contain (i) certain customary affirmative covenants, including those that
impose certain reporting and/or performance obligations on KDP and its subsidiaries, (ii) certain customary negative covenants that generally limit, subject to various exceptions, KDP and its subsidiaries from taking certain actions, including,
without limitation, incurring liens, consummating certain fundamental changes and entering into transactions with affiliates, (iii) a financial covenant in the form of a total net leverage ratio and (iv) customary events of default
(including a change of control) for financings of this type, in each case substantially similar to the terms of the Existing 364-Day Credit Agreement.
KDP is also party to (1) that certain credit agreement, dated as of February 28, 2018 (as amended, restated, amended and restated,
supplemented or otherwise modified from time to time, the 2018 Credit Agreement, and together with the Existing 364-Day Credit Agreement, the Existing Revolving Credit Facilities), by
and among KDP, as borrower, the lenders party thereto and the Administrative Agent and (2) that certain term loan agreement, dated as of February 8, 2019 (as amended, restated, amended and restated, supplemented or otherwise modified from
time to time, the Term Loan Facility) by and among KDP, as borrower, the lenders party thereto and the Administrative Agent. We intend to use a portion of the net proceeds from this offering to permanently repay in full and terminate the
Term Loan Facility. See Use of Proceeds.
Redemption
We intend to use a portion of the net proceeds from this offering to redeem (x) all of (i) our 3.200% Senior Notes due
November 15, 2021 (CUSIP No. 26138E AP4), of which $250,000,000 aggregate principal amount is currently outstanding (the 2021-A Notes), (ii) our 2.530% Senior Notes due November 15, 2021
(CUSIP No. 26138E AV1), of which $250,000,000 aggregate principal amount is currently outstanding (the 2021-B Notes) and (iii) our 2.700% Senior Notes due November 15, 2022 (CUSIP No.
26138E AR0), of which $250,000,000 aggregate principal amount is currently outstanding (the 2022 Notes) and (y) a portion of our 4.057% Senior Notes due May 25, 2023 (144A CUSIP No. 565122 AC2, CUSIP No. 49271V AG5), of
which $2,000,000,000 aggregate principal amount is currently outstanding (the 2023 Merger Notes and together with the 2021-A Notes, the 2021-B Notes and the
2022 Notes, the Redemption Notes), in accordance with the terms of the applicable indentures governing each series of the Redemption Notes (the Redemption). See Use of Proceeds.