| ITEM 1.01 | ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT |
On December 11, 2023, Stryker Corporation (the “Company”) completed a public offering (the “Offering”) of €600,000,000 aggregate principal amount of the Company’s 3.375% Notes due 2028 (the “Notes”).
The Notes were sold pursuant to an Underwriting Agreement, dated December 6, 2023 (the “Underwriting Agreement”), between the Company and Barclays Bank PLC, Goldman Sachs & Co. LLC, Mizuho International plc and Wells Fargo Securities International Limited, as representatives of the underwriters. The Offering was made pursuant to the Company’s Automatic Shelf Registration Statement on Form S-3 (File No. 333-275853) and the Prospectus included therein, filed with the Securities and Exchange Commission on December 1, 2023, and supplemented by the Prospectus Supplement dated December 6, 2023.
The Notes were issued under an Indenture, dated January 15, 2010 (the “Base Indenture”), between the Company and U.S. Bank Trust Company, National Association, as successor in interest to U.S. Bank, National Association, as trustee (the “Trustee”), as supplemented by the Twenty-Seventh Supplemental Indenture, dated December 11, 2023, between the Company and the Trustee (the “Supplemental Indenture” and, the Base Indenture as so supplemented, the “Indenture”).
The Notes will bear interest at a rate of 3.375% per year. Interest on the Notes is payable on December 11 of each year, commencing on December 11, 2024. The Notes will mature on December 11, 2028.
The Company may redeem the Notes at its option, in whole, but not in part, for cash, at any time prior to their maturity at a price equal to 100% of the outstanding principal amount of the Notes, plus accrued and unpaid interest to, but not including, the redemption date, if certain tax events occur that would obligate the Company to pay additional amounts as described in the Indenture. In addition, prior to September 11, 2028, the Company may redeem the Notes at the Company’s option for cash, any time in whole or from time to time in part, at a redemption price that includes accrued and unpaid interest and the applicable make-whole premium, as specified in the Indenture. However, no make-whole premium will be paid for redemption of the Notes on or after September 11, 2028.
The Company expects to receive net proceeds of approximately €597 million (or $649 million based on an exchange rate of €1 to $1.0878 on December 1, 2023, as published by the U.S. Federal Reserve Board), after deducting the underwriting discount and the Company’s estimated expenses related to the Offering. The Company intends to use the net proceeds from the Offering for general corporate purposes.
The Company may issue additional debt from time to time pursuant to the Indenture. The Indenture contains covenants that limit the Company’s ability to, among other things, incur certain liens securing indebtedness, engage in certain sale and leaseback transactions, and enter into certain consolidations, mergers, conveyances, transfers or leases of all or substantially all of the Company’s assets. Subject to certain limitations, in the event of the occurrence of both (1) a change of control of the Company and (2) a downgrade of the Notes below investment grade rating by both Moody’s Investors’ Services, Inc. and Standard & Poor’s Ratings Services within a specified time period, the Company will be required to make an offer to purchase the Notes at a price equal to 101% of the principal amount of the Notes, plus accrued and unpaid interest to, but not including, the date of repurchase.
The foregoing description of the Underwriting Agreement, the Base Indenture and the Supplemental Indenture does not purport to be complete and is qualified in its entirety by reference to the full text of such documents, which are filed as Exhibits 1.1, 4.1 and 4.2 hereto, respectively, and incorporated herein by reference.
| ITEM 2.03 | CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT |
The information set forth in Item 1.01 above with respect to the Notes is hereby incorporated by reference into this Item 2.03, insofar as it relates to the creation of a direct financial obligation.
