8-KRegulation FD

APPLIED MATERIALS INC /DE 8-K Report, Regulation FD Disclosure (Apr 6, 2009)

Filed April 6, 2009For Securities:AMAT

Summary

This 8-K filing from Applied Materials, Inc. (AMAT) announced a significant amendment to a previously disclosed sales agreement concerning its SunFab™ thin film solar production equipment. Originally valued at approximately $1.9 billion with a private "Buyer," the amended agreement drastically reduces the scope, cutting the aggregate purchase price to approximately $250 million. This revision is attributed to the "deterioration in global economic and financial market conditions." Under the amended terms, the production capacity to be supplied is reduced, and the agreement's continuation is contingent upon the Buyer fulfilling specific payment and security obligations, as well as other conditions. Importantly, Applied Materials has not recognized any orders related to either the original or amended agreements. The company also states that parties will explore future opportunities, contingent on financing and market conditions.

Key Highlights

  • 1Amendment to a major solar equipment sales agreement originally valued at $1.9 billion.
  • 2Aggregate purchase price reduced significantly to approximately $250 million due to economic conditions.
  • 3Reduced production capacity to be supplied to the "Buyer".
  • 4Continuation of the amended agreement is subject to Buyer's satisfaction of payment, security, and other conditions.
  • 5Applied Materials has not recognized any orders related to this agreement (original or amended).
  • 6Parties will explore future business opportunities, dependent on financing and market conditions.

Frequently Asked Questions

The primary reason cited for amending the agreement was the significant deterioration in global economic and financial market conditions.

The aggregate purchase price has been reduced from approximately $1.9 billion under the original agreements to approximately $250 million under the amended agreement.

No, Applied Materials explicitly stated that it has not recognized any orders in connection with either the original or the amended agreement.

The amended agreement requires the Buyer to perform specified payment and security obligations, and for certain other conditions to be satisfied. Upon fulfillment of these, the original agreements concerning the remaining equipment will terminate, except for specified rights and obligations.