8-KMaterial AgreementsExhibits & Filings

APPLIED MATERIALS INC /DE 8-K Report, Material Agreement (Jun 6, 2011)

Filed June 6, 2011For Securities:AMAT

Summary

Applied Materials, Inc. (AMAT) filed an 8-K report on June 6, 2011, disclosing the entry into a material definitive agreement for the issuance and sale of senior unsecured notes. The company entered into an Underwriting Agreement on June 1, 2011, with J.P. Morgan Securities LLC and Citigroup Global Markets Inc. as representatives for underwriters, for the sale of $1.75 billion in senior unsecured notes. The proceeds from this offering are earmarked to fund a portion of the consideration and associated costs for its proposed merger with Varian Semiconductor Equipment Associates, Inc. (Varian), as previously announced. This demonstrates a strategic move by AMAT to secure financing for a significant corporate action, which could impact its capital structure and future growth prospects.

Key Highlights

  • 1Entered into an Underwriting Agreement on June 1, 2011, for the issuance and sale of $1.75 billion in senior unsecured notes.
  • 2The notes are offered in three tranches: $400 million of 2.650% notes due 2016, $750 million of 4.300% notes due 2021, and $600 million of 5.850% notes due 2041.
  • 3Net proceeds are expected to be approximately $1.73 billion after deducting underwriting discounts and expenses.
  • 4The primary use of proceeds is to fund the proposed merger with Varian Semiconductor Equipment Associates, Inc.
  • 5The offering is being conducted under a registration statement on Form S-3.
  • 6Customary representations, warranties, closing conditions, indemnification, and termination provisions are included in the Underwriting Agreement.

Frequently Asked Questions

The primary purpose of the note issuance is to secure funding for a portion of the consideration and related expenses for Applied Materials' proposed merger with Varian Semiconductor Equipment Associates, Inc.

The notes are being issued in three tranches: $400 million with a 2.650% interest rate due in 2016, $750 million with a 4.300% interest rate due in 2021, and $600 million with a 5.850% interest rate due in 2041.

Applied Materials expects to receive approximately $1.73 billion in net proceeds after accounting for underwriting discounts and estimated offering expenses.

J.P. Morgan Securities LLC and Citigroup Global Markets Inc. are acting as the representatives for the several underwriters in this offering.