SECURITIES AND EXCHANGE COMMISSION
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ITEM 7.01. REGULATION FD DISCLOSURE.
On August 5, 2022, Owens Brockway Glass Container Inc. (“OBGC”), an indirect wholly owned subsidiary of O-I Glass, Inc. (the “Company”), completed a sale and leaseback transaction with 2900 Fruitland Avenue Investors LLC and 2901 Fruitland Avenue Investors LLC (collectively, the “Buyer”), pursuant to which the Buyer purchased OBGC’s plant in Vernon, California for a purchase price of approximately $181 million.
In connection with this transaction, OBGC, as tenant, and the Company, as a guarantor, agreed to lease the Vernon plant from Buyer for an initial term of 10 years. The lease terms require OBGC to make base rent payments of approximately $7.2 million in the first year, gradually increasing to approximately $10.3 million in the tenth year. OBGC, in its discretion, has extension options for up to 13 additional years, via two options to extend for an additional five years each along with a third option to extend for an additional three years. OBGC also has termination options at no cost during the initial term, as early as the fifth anniversary, subject to OBGC providing the required advance notice.
On August 8, 2022, the Company issued a press release announcing the completion of this sale and leaseback transaction. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information set forth in this Item 7.01, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in this Item 7.01, including Exhibit 99.1, shall not be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
|99.1||Press Release, dated August 8, 2022|
|104||Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|O-I GLASS, INC.|
|Date: August 8, 2022||By:||/s/ John A. Haudrich|
|Name:||John A. Haudrich|
|Title:||Senior Vice President and Chief Financial Officer|
O-I Glass Completes
Sale-Leaseback of Vernon, CA Property
Completes Full $1.5 Billion Portfolio Optimization Program
PERRYSBURG, Ohio, (AUG 8, 2022)— O-I Glass, Inc. (NYSE: OI) today announced the completion of a sale and leaseback transaction for its plant located in Vernon, California. The $181 million agreement includes a long-term lease as well as additional renewal options.
With this sale and leaseback agreement, O-I will have completed its $1.5 billion Portfolio Optimization program, designed to re-align the company’s business portfolio, improve Return on Invested Capital, and fund organic growth, such as the recently announced new greenfield glass packaging production facility in Bowling Green, KY, which will leverage the company’s revolutionary MAGMA technology.
“This sale marks the completion of our $1.5 billion Portfolio Optimization Program,” said Andres Lopez, O-I Glass CEO. “This milestone is a key enabler of our Capital Expansion Plan to enable profitable growth over the next three years, adding much-needed capacity to address current customer demand and market trends.”
O-I Glass news releases are available on the O-I Glass website at www.o-i.com.
About O-I Glass
At O-I Glass, Inc. (NYSE: OI), we love glass and we’re proud to be one of the leading producers of glass bottles and jars around the globe. Glass is not only beautiful, it’s also pure and completely recyclable, making it the most sustainable rigid packaging material. Headquartered in Perrysburg, Ohio (USA), O-I is the preferred partner for many of the world’s leading food and beverage brands. We innovate in line with customers’ needs to create iconic packaging that builds brands around the world. Led by our diverse team of more than 24,000 people across 70 plants in 19 countries, O-I achieved net sales of $6.4 billion in 2021. Learn more about us: o-i.com / Facebook / Twitter / Instagram / LinkedIn. The company routinely posts important information on its website – www.o-i.com/investors.
This press release contains “forward-looking” statements related to O-I Glass, Inc. (“O-I” or the “company”) within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Section 27A of the Securities Act of 1933, as amended. Forward-looking statements reflect the company’s current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words “achieve,” “believe,” “expect,” “anticipate,” “will,” “could,” “would,” “should,” “may,” “plan,” “estimate,” “intend,” “predict,” “potential,” “continue,” and the negatives of these words and other similar expressions generally identify forward-looking statements.
|O-I Glass, Inc.||o-i.com|
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It is possible that the company’s future financial performance may differ from expectations due to a variety of factors including, but not limited to the following: (1) the impact of the COVID-19 pandemic and the various governmental, industry and consumer actions related thereto, (2) the company’s ability to obtain the benefits it anticipates from the Corporate Modernization, (3) the company’s ability to manage its cost structure, including its success in implementing restructuring or other plans aimed at improving the company’s operating efficiency and working capital management, and achieving cost savings, (4) the company’s ability to acquire or divest businesses, acquire and expand plants, integrate operations of acquired businesses and achieve expected benefits from acquisitions, divestitures or expansions, (5) the company’s ability to achieve its strategic plan, (6) the company’s ability to improve its glass melting technology, known as the MAGMA program, and implement it within the timeframe expected, (7) foreign currency fluctuations relative to the U.S. dollar, (8) changes in capital availability or cost, including interest rate fluctuations and the ability of the company to refinance debt on favorable terms, (9) the general political, economic and competitive conditions in markets and countries where the company has operations, including uncertainties related to economic and social conditions, disruptions in the supply chain, competitive pricing pressures, inflation or deflation, changes in tax rates and laws, war, civil disturbance or acts of terrorism, natural disasters, and weather, (10) the company’s ability to generate sufficient future cash flows to ensure the company’s goodwill is not impaired, (11) consumer preferences for alternative forms of packaging, (12) cost and availability of raw materials, labor, energy and transportation (including impacts related to the current conflict between Russia and Ukraine), (13) consolidation among competitors and customers, (14) unanticipated expenditures with respect to data privacy, environmental, safety and health laws, (15) unanticipated operational disruptions, including higher capital spending, (16) the company’s ability to further develop its sales, marketing and product development capabilities, (17) the failure of the company’s joint venture partners to meet their obligations or commit additional capital to the joint venture, (18) the ability of the company and the third parties on which it relies for information technology system support to prevent and detect security breaches related to cybersecurity and data privacy, (19) changes in U.S. trade policies, (20) risks related to recycling and recycled content laws and regulations, (21) risks related to climate-change and air emissions, including related laws or regulations and the other risk factors discussed in the company's filings with the Securities and Exchange Commission.
It is not possible to foresee or identify all such factors. Any forward-looking statements in this document are based on certain assumptions and analyses made by the company in light of its experience and perception of historical trends, current conditions, expected future developments, and other factors it believes are appropriate in the circumstances. Forward-looking statements are not a guarantee of future performance and actual results or developments may differ materially from expectations. While the company continually reviews trends and uncertainties affecting the company’s results or operations and financial condition, the company does not assume any obligation to update or supplement any particular forward-looking statements contained in this document.
|O-I Glass, Inc.||o-i.com|
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Vice President of Investor Relations
Director of Corporate Communications
|O-I Glass, Inc.||o-i.com|