| Item 1.01 |
Entry into a Material Definitive Agreement |
On October 22, 2020, Lowe’s Companies, Inc. (the “Company”) issued an aggregate of $4.0 billion of unsecured notes, consisting of $1 billion aggregate principal amount of its 1.300% Notes due April 15, 2028 (the “2028 Notes”), $1.25 billion aggregate principal amount of its 1.700% Notes due October 15, 2030 (the “2030 Notes”), and $1.75 billion aggregate principal amount of its 3.000% Notes due October 15, 2050 (the “2050 Notes” and, together with the 2028 Notes and the 2030 Notes, the “Notes”). The Company received net proceeds, after expenses and the underwriting discount, of approximately $3.962 billion from the issuance of the Notes.
The Notes are governed by and were issued pursuant to the terms of an Amended and Restated Indenture, dated as of December 1, 1995 (the “Base Indenture”), between the Company and U.S. Bank National Association, as successor trustee (the “Trustee”), as supplemented by a Seventeenth Supplemental Indenture, dated as of October 22, 2020, between the Company and the Trustee (the “Seventeenth Supplemental Indenture” and, the Base Indenture as supplemented by the Seventeenth Supplemental Indenture, the “Indenture”).
The Notes are unsecured obligations and rank equally with the Company’s existing and future unsecured senior indebtedness. The Indenture contains covenants restricting the issuance of debt by the Company’s subsidiaries but does not restrict the Company from incurring additional indebtedness. Each series of the Notes is a new issue of securities with no established trading market. The Company does not intend to apply for the listing of any series of the Notes on any securities exchange or for quotation of such Notes on any automated dealer quotation system.
The 2028 Notes will mature on April 15, 2028, the 2030 Notes will mature on October 15, 2030 and the 2050 Notes will mature on October 15, 2050, in each case, unless earlier redeemed or repurchased by the Company. The 2028 Notes will bear interest at a rate of 1.300% per annum, the 2030 Notes will bear interest at a rate 1.700% per annum and the 2050 Notes will bear interest at a rate of 3.000% per annum. The Company will pay interest on the Notes semiannually in arrears on April 15 and October 15, commencing April 15, 2021. Interest will be computed on the basis of a 360-day year composed of twelve 30-day months. Payments of principal and interest to owners of book-entry interests will be made in accordance with the procedures of The Depository Trust Company and its participants in effect from time to time.
At any time prior to the date that is two months (with respect to the 2028 Notes), three months (with respect to the 2030 Notes) or six months (with respect to the 2050 Notes) prior to the applicable maturity date for such series of Notes, the Notes of each series will be redeemable, in whole at any time or in part from time to time, at the Company’s option, at a redemption price, to be calculated by the Company, equal to the greater of (i) 100% of the principal amount of the Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments of principal and interest on such Notes that, but for the redemption, would be due after the related redemption date through the applicable par call date with respect to the series of Notes being redeemed, assuming such Notes matured on the applicable par call date (not including any portion of such payments of interest accrued as of the date of redemption), discounted to the date of redemption on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Seventeenth Supplemental Indenture), plus 15 basis points with respect to the 2028 Notes, 15 basis points with respect to the 2030 Notes and 25 basis points with respect to the 2050 Notes; plus, in each case, accrued and unpaid interest thereon to, but excluding, the date of redemption.
On or after the date that is two months (with respect to the 2028 Notes), three months (with respect to the 2030 Notes) or six months (with respect to the 2050 Notes) prior to the applicable maturity date for such series of Notes, the 2028 Notes, the 2030 Notes and the 2050 Notes will be redeemable, in whole at any time or in part from time to time, at the Company’s option, at par plus accrued and unpaid interest thereon to, but excluding, the date of redemption.
In addition, upon a Change of Control Triggering Event (as defined in the Seventeenth Supplemental Indenture), the holders of the Notes may require the Company to repurchase all or any part of their Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest, if any, on such Notes to the date of purchase (unless the Company has exercised its right to redeem the Notes).
