| Item 1.01 | Entry into a Material Definitive Agreement. |
On June 11, 2024, Applied Materials, Inc. (“Applied”) completed a registered public offering of $700 million in aggregate principal amount of 4.800% senior unsecured notes due 2029 (the “Notes”) pursuant to an underwriting agreement (the “Underwriting Agreement”) with BofA Securities, Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named therein, and an indenture dated as of June 11, 2024 (the “Base Indenture”), between Applied and The Bank of New York Mellon Trust Company, N.A., as trustee, as supplemented by a supplemental indenture dated as of June 11, 2024 (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”). Applied intends to use the net proceeds from the offering for general corporate purposes. The Notes were issued and sold pursuant to Applied’s registration statement on Form S-3ASR (File No. 333-279682).
Indenture
Applied issued the Notes under the Indenture, which establishes the terms and forms of the Notes. Interest is payable on the Notes semi-annually in arrears on June 15 and December 15 each year, commencing December 15, 2024.
The Indenture contains limited covenants of Applied. The negative covenants limit the ability of Applied and its subsidiaries to incur debt secured by liens on principal property or on shares of stock of Applied’s principal subsidiaries; to engage in sale and leaseback transactions with respect to any principal property; and to consolidate, merge or sell (or otherwise dispose of) all or substantially all of Applied and its subsidiaries’ property and assets taken as a whole. Applied may be required to offer to repurchase the Notes upon a change in control and a contemporaneous downgrade of the Notes below an investment grade rating, and it may elect to redeem the Notes in whole or in part at any time, as further specified in the Indenture.
Events of default under the Indenture include a failure to make payments, non-performance of covenants, and bankruptcy and insolvency-related events. Applied’s obligations may be accelerated upon an event of default, in which case the entire principal amount of the Notes would become immediately due and payable.
The foregoing description of certain terms of the Indenture does not purport to be complete and is qualified in its entirety by reference to the full text of the Base Indenture and the Supplemental Indenture (including the form of the Notes included therein), which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
On June 6, 2024, Applied entered into the Underwriting Agreement for the sale of the Notes. The Underwriting Agreement contains customary representations, warranties and agreements by Applied, and customary closing conditions, indemnification rights and termination provisions.
The above description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Underwriting Agreement, which is filed as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Wilson Sonsini Goodrich Rosati, Professional Corporation, counsel to Applied, has issued an opinion to Applied dated June 11, 2024 regarding the legality of the Notes. A copy of the opinion is filed as Exhibit 5.1 hereto.
