Item 7.01 Regulation FD Disclosure.
As previously disclosed, on September 20, 2020 (the "Petition Date"), the
Company and certain of its subsidiaries (collectively, the "Debtors") each filed
a voluntary petition for relief under chapter 11 of title 11 of the United
States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for
the Southern District of New York (the "Bankruptcy Court"). The Debtors' chapter
11 cases (the "Chapter 11 Cases") are being jointly administered under the
caption "In re Garrett Motion Inc., 20-12212."
Also as previously disclosed, on the Petition Date, certain of the Debtors (the
"Sellers") also entered into a share and asset purchase agreement (the "Stalking
Horse Purchase Agreement") with AMP Intermediate B.V. (the "Stalking Horse
Bidder") and AMP U.S. Holdings, LLC, each affiliates of KPS Capital Partners,
LP, pursuant to which the Stalking Horse Bidder has agreed to purchase, subject
to the terms and conditions contained therein, all of the equity interests in
each of Garrett LX I S.à r.l., and Garrett Transportation I Inc. (subject to an
election by the Stalking Horse Bidder to purchase substantially all of the
assets of Garrett Transportation I Inc., instead of its equity), along with
certain other assets and liabilities of the Debtors (the "Acquired Assets")
pursuant to a plan of reorganization under the Bankruptcy Code. The acquisition
of the Acquired Assets pursuant to the Stalking Horse Purchase Agreement is
subject to approval of the Bankruptcy Court and an auction to solicit higher or
otherwise better bids pursuant to a bidding procedures order to be entered by
the Bankruptcy Court (the "Bidding Procedures Order"). Under the Bidding
Procedures Order, the Stalking Horse Purchase Agreement serves as the minimum or
floor bid on which the Debtors, their creditors, suppliers, vendors, and other
bidders may rely.
On October 19, 2020, the Company issued a press release, (i) disclosing that it
had received a proposal from the Stalking Horse Bidder to revise the terms of
the Stalking Horse Purchase Agreement following approval of the Bidding
Procedures Order by the Bankruptcy Court (the "Stalking Horse Bidder Revised
Proposal") and (ii) referencing the public announcement that Honeywell
International Inc., Centerbridge Partners, L.P. and Oaktree Management L.P.
(collectively, the "Bidding Group") had entered into a coordination agreement in
anticipation of submitting to the Company an alternative proposal for a plan of
reorganization (the "Alternative Proposal") (the "Press Release"). The Press
Release is furnished herewith as Exhibit 99.1, which is incorporated herein by
reference.
The Alternative Proposal was delivered to the Company on October 16, 2020, and
was publicly disclosed in (i) Amendment No. 1 to the Schedule 13D filed by
Oaktree Capital Management, L.P. and certain of its affiliates ("Oaktree") on
October 16, 2020 (the "Oaktree Amended 13D") and (ii) Amendment No. 1 to the
Schedule 13D filed by Centerbridge Credit Partners Master, L.P. and certain of
its affiliates on October 16, 2020. The proposed terms of the Alternative
Proposal are described in the coordination agreement, previously filed by
Oaktree as Exhibit II to the Oaktree Amended 13D, which is incorporated by
reference and furnished herewith as Exhibit 99.2. In connection with the
Alternative Proposal, the Company received a letter from the Bidding Group's
attorneys on October 16, 2020, a copy of which is furnished herewith as Exhibit
99.3 and incorporated herein by reference (the "Bidding Group Letter"). The
Company responded to the Bidding Group Letter through its attorneys by letter on
October 19, 2020 (the "Garrett Letter"). A copy of the Garrett Letter is
furnished herewith as Exhibit 99.4 and incorporated herein by reference.
The Stalking Horse Bidder Revised Proposal was delivered to the Company on
October 19, 2020. The proposed terms of the Stalking Horse Bidder Revised
Proposal are described in the letter of intent of the same date furnished
herewith as Exhibit 99.5, which is incorporated herein by reference. The
Stalking Horse Bidder Revised Proposal is subject to Bankruptcy Court approval
of the Debtors' proposed Bidding Procedures Order. The Stalking Horse Purchase
Agreement would remain subject to higher or better offers in the Chapter 11
Cases. Closing of the transaction is subject to customary regulatory approvals,
as well as Bankruptcy Court approval and other customary conditions. Following
Bankruptcy Court approval of the Debtors' proposed Bidding Procedures Order, the
Company expects to discuss with the Stalking Horse Bidder amendments to the
Stalking Horse Purchase Agreement and other transaction documentation to reflect
the terms of the revised bid.
The information furnished pursuant to this Item 7.01, including Exhibits 99.1,
99.2, 99.4 and 99.5, shall not be deemed "filed" for purposes of Section 18 of
the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to
the liabilities under that Section and shall not be deemed to be incorporated by
reference into any filing of the Company under the Securities Act of 1933 or the
Exchange Act.
--------------------------------------------------------------------------------
Cautionary Information Regarding Trading in the Company's Securities.
The Company's securityholders are cautioned that trading in the Company's
securities during the pendency of the Chapter 11 Cases is highly speculative and
poses substantial risks. Trading prices for the Company's securities may bear
little or no relationship to the actual recovery, if any, by holders thereof in
the Company's Chapter 11 Cases. Accordingly, the Company urges extreme caution
with respect to existing and future investments in its securities.
Forward-Looking Statements
This Current Report on Form 8-K contains "forward-looking statements" within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended. All
statements, other than statements of fact, that address activities, events or
developments that the Company or the Company's management intend, expect,
project, believe or anticipate will or may occur in the future are
forward-looking statements including without limitation the Company's statements
regarding the Alternative Proposal and the Stalking Horse Bidder Revised
Proposal. Although the Company believes forward-looking statements are based
upon reasonable assumptions, such statements involve known and unknown risks,
uncertainties, and other factors, which may cause the actual results or
performance of the company to be materially different from any future results or
performance expressed or implied by such forward-looking statements. Such risks
and uncertainties include, but are not limited to those described in the
Company's annual report on Form 10-K for the year ended December 31, 2019, as
updated by the Company's quarterly report on Form 10-Q for the period ended
June 30, 2020, as well as the Company's other filings with the Securities and
Exchange Commission, under the headings "Risk Factors" and "Cautionary Statement
Concerning Forward-Looking Statements." You are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the date of
this document. Forward-looking statements are not guarantees of future
performance, and actual results, developments and business decisions may differ
from those envisaged by the Company's forward-looking statements.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
99.1 Press Release of Garrett Motion Inc., dated October 19, 2020.
99.2 Coordination Agreement by and among the parties identified therein
(incorporated by reference to Exhibit II to Amendment No. 1 to the
Schedule 13D jointly filed on October 16, 2020 by Oaktree Capital
Management, L.P., among others).
99.3 Letter from the Bidding Group's Attorneys to the Company's
Attorneys, dated October 16, 2020.
99.4 Letter from the Company's Attorneys to the Bidding Group's
Attorneys, dated October 19, 2020.
99.5 Letter of Intent of KPS Capital Partners, L.P., dated October 19,
2020.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses
GARRETT MOTION INC. 
