Filing Details

CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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CUSIP No. 366505105

Schedule 13D

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This amendment (this “Amendment No. 1”) amends the Schedule 13D filed by the Reporting Persons on May 13, 2021 (the “Original Schedule 13D” and, as amended by this Amendment No. 1, the “Schedule 13D”). Capitalized terms used herein but not defined herein shall have the respective meanings defined in the Original Schedule 13D. The Original Schedule 13D is amended hereby only as specifically set forth herein, provided that with respect to any Item amended herein, if such Item is incorporated by reference into any other Item in the Original Schedule 13D as previously amended, such incorporation by reference is also amended hereby.

Item 4.

Purpose of Transaction

Item 4 is hereby amended by the addition of the following:

On April 12, 2023, Credit Partners Master and SC III-Flex entered into a Transaction Agreement with the Company (the “Transaction Agreement”).  Pursuant to the Transaction Agreement, the Company has agreed to repurchase approximately $280 million of shares of its Series A Preferred Stock from Credit Partners Master and SC III-Flex (the “Series A Repurchase”). The Company will pay to Credit Partners Master and SC III-Flex a cash price of $8.10 per repurchased share, which amount will be adjusted to equal the volume-weighted average price of the Company’s Common Stock for the fifteen (15) trading days following the announcement of the transactions, subject to a minimum price of $7.875 and a maximum price of $8.50 (the “Investor Purchase Price”).  In addition to the Investor Purchase Price, for each repurchased share, Credit Partners Master and SC III-Flex will be entitled to receive at the closing of the Series A Repurchase all dividends or other amounts paid or payable on the shares of Series A Preferred Stock, consisting of $0.17 per share, representing the preference dividends that will accrue on the Series A Preferred Stock from April 1, 2023 through June 30, 2023; approximately $0.6835 per share, representing other accrued and unpaid preference dividends on the Series A Preferred Stock; and $0.144375 per share, representing the preference dividends that would have accrued on the Series A Preferred Stock from July 1, 2023 through September 30, 2023.

In addition, pursuant to the Transaction Agreement, Credit Partners Master and SC III-Flex consented to an amendment and restatement to the current certificate of designations for the Series A Preferred Stock (as so amended and restated, the “Second Amended and Restated Certificate of Designations”). After the effectiveness of the Second Amended and Restated Certificate of Designations until September 30, 2023, the Second Amended and Restated Certificate of Designations suspends the potential occurrence of an “Automatic Conversion Event” (as defined therein), and requires the Company to cause a conversion of all shares of Series A Preferred Stock into shares of Common Stock if the Series A Repurchase has been completed (the “Conversion”). Upon the Conversion, each holder of Series A Preferred Stock as of the Conversion will receive one (1) share of Common Stock for each share of Series A Preferred Stock then held, plus any dividends or other amounts payable on the shares of Series A Preferred, as described above.

Pursuant to the Transaction Agreement, the board designation rights of the Reporting Persons will be reduced from three (3) designees to one (1) designee. Furthermore, this number will be reduced to zero at such time as the Reporting Persons beneficially own less than ten percent (10%) of the outstanding voting securities of the Company on an as-converted basis.

The Transaction Agreement provides, among other things, that the Reporting Persons (i) will not acquire beneficial ownership of additional shares of the Company’s equity securities if such acquisition would result in the Reporting Persons beneficially owning more than fifteen percent (15%) of the outstanding voting securities of the Company on an as-converted basis, and (ii) will vote any shares held in excess of eighteen percent (18%) of the voting power of the Company’s voting securities in the manner voted by holders who beneficially own less than eighteen percent (18%) of the Company’s equity securities. These limitations will terminate on the earliest to occur of (i) eighteen (18) months from the date of the Transaction Agreement, (ii) the commencement of an unsolicited tender offer for a majority of the voting securities of the Company, or (iii) any insolvency or bankruptcy of the Company.

 

The Transaction Agreement provides that, from the date of the Transaction Agreement, the Reporting Person will not (i) directly or indirectly transfer or dispose of any shares of the Company, (ii) enter into certain transactions that transfer or dispose of their economic or other interests in such shares, or (iii) publicly disclose any intention to do either of the foregoing. The lock-up restrictions will be released with respect to 50% of the shares beneficially owned by the Reporting Persons on the date that is six (6) months from the earlier to occur of (x) the completion of the Series A Repurchase and (y) 45 days from the execution of the Transaction Agreement (the “Lock-Up Trigger Date”), and

with respect to all of the shares beneficially owned by the Reporting Persons on the date that is twelve (12) months from the Lock-Up Trigger Date. The lock-up restrictions are subject to exceptions, including transfers made with the prior written consent of the Company and the approval of the Company’s Preferred Stock Conversion Committee, as well as customary exceptions for transfers in connections with tender offers, certain other fundamental transactions, and the grant of proxies in connection with annual or special meetings of the Company.

The foregoing description of the Transaction Agreement is qualified in its entirety by reference to the full text of the Transaction Agreement, which is incorporated herein by reference.

Item 5.

Interest in Securities of the Issuer.

Item 5 is hereby amended and restated to read as follows:

(a) and (b).

The information required by Items 5(a) – (b) is set forth in rows 7 – 13 of the cover page for each of the Reporting Persons and is incorporated herein by reference.

Item 6.

Contracts, Arrangement, Understandings or Relationships with Respect to Securities of the Issuer.

Credit Partners Master and SC III-Flex are parties to the Transaction Agreement. The summary of the Transaction Agreement set forth in Item 4 is incorporated in this Item 6 by reference.

Item 7.	Material to be Filed as Exhibits.
99.1	Transaction Agreement, dated as of April 12, 2023, by and among Garrett Motion Inc., Credit Partners Master and SC III-Flex, as filed pursuant to the Form 8-K filed by the Company on April 14, 2023, and incorporated herein by reference.