Item 1.01
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Entry into a Material Definitive Agreement.
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On September 29, 2017, Pilgrims Pride
Corporation (the Company) completed a sale of $250 million aggregate principal amount of its 5.750% Senior Notes due 2025 (the Additional 2025 Notes) and $600 million aggregate principal amount of its 5.875% Senior
Notes due 2027 (the 2027 Notes and, together with the Additional 2025 Notes, the Notes). The Company intends to use the net proceeds from the sale of the Notes to repay in full the £562.5 million ($736.8 million)
indebtedness outstanding under the promissory note issued on September 8, 2017 by Onix Investments UK Limited, a wholly-owned subsidiary of the Company, and guaranteed by the Company to JBS S.A. in connection with the Companys acquisition
of Moy Park Holdings (Europe) Ltd. The balance of the net proceeds from the sale of the Notes will be used for general corporate purposes.
The Notes were
sold to qualified institutional buyers pursuant to Rule 144A under the U.S. Securities Act of 1933, as amended (the Securities Act), and outside the United States to
non-U.S.
persons pursuant to
Regulation S under the Securities Act. This Current Report on Form
8-K
shall not constitute an offer to sell or the solicitation of an offer to buy the Notes.
The Company issued the Additional 2025 Notes pursuant to the Companys existing Indenture dated as of March 11, 2015 by and among the Company,
Pilgrims Pride Corporation of West Virginia, Inc., and Wells Fargo Bank, National Association, as Trustee (the 2025 Indenture). The 2025 Indenture provides, among other things, that the Additional 2025 Notes will bear interest at a
rate of 5.750% per annum from the date of issuance until maturity, payable semi-annually in cash in arrears, beginning on March 15, 2018. The Additional 2025 Notes were issued at a price of 102.000% of the aggregate principal amount, reflecting
a yield to maturity of 5.420%. The Additional 2025 Notes are guaranteed on a senior unsecured basis by Pilgrims Pride Corporation of West Virginia, Inc., Goldn Plump Poultry, LLC, Goldn Plump Farms, LLC and JFC LLC (the
Guarantors). The Additional 2025 Notes and related guarantees are unsecured senior obligations of the Company and Guarantors and rank equally with all of the Companys and Guarantors other unsubordinated indebtedness. The
Additional 2025 Notes will be treated as a single class with the existing 2025 notes for all purposes under the 2025 Indenture and will have the same terms as those of the existing 2025 notes.
The 2027 Notes are governed by, and were issued pursuant to, the Companys Indenture dated as of September 29, 2017 by and among the Company, the
Guarantors, and U.S. Bank National Association, as Trustee (the 2027 Indenture and, together with the 2025 Indenture, the Indentures). The 2027 Indenture provides, among other things, that the 2027 Notes will bear interest at
a rate of 5.875% per annum from the date of issuance until maturity, payable semi-annually in cash in arrears, beginning on March 30, 2018. The 2027 Notes are guaranteed on a senior unsecured basis by the Guarantors. The 2027 Notes and related
guarantees are unsecured senior obligations of the Company and Guarantors and rank equally with all of the Companys and Guarantors other unsubordinated indebtedness.
The Notes and the Indentures also contain customary covenants and events of default, including failure to pay principal or interest on the Notes when due,
among others.
The foregoing description of the material terms of the Indentures are qualified in its entirety by reference to the 2025 Indenture and the
2027 Indenture, which are attached to this Current Report on Form
8-K
as Exhibit 4.1 and 4.2, respectively, and incorporated herein by reference.