8-KMaterial AgreementsFinancial EventsExhibits & Filings

AMGEN INC 8-K Report, Material Agreement (May 23, 2008)

Filed May 23, 2008For Securities:AMGN

Summary

Amgen Inc. (AMGN) has filed an 8-K report detailing a significant debt offering and the subsequent redemption of existing debt. On May 20, 2008, the company entered into an underwriting agreement to issue and sell $1 billion in aggregate principal amount of senior notes, split equally between 6.15% Senior Notes due 2018 and 6.90% Senior Notes due 2038. This offering, which closed on May 23, 2008, generated net proceeds of approximately $990.9 million after accounting for underwriter discounts and expenses. The primary purpose of this debt issuance was to fund the redemption of $1.0 billion of Amgen's outstanding Senior Floating Rate Notes due 2008. This move indicates a strategic financial management decision to refinance maturing debt with longer-term, fixed-rate obligations, potentially to lock in borrowing costs and manage interest rate risk.

Key Highlights

  • 1Amgen Inc. issued $1 billion in new senior notes: $500 million of 6.15% Senior Notes due 2018 and $500 million of 6.90% Senior Notes due 2038.
  • 2The notes were issued under an effective registration statement on Form S-3 and pursuant to an indenture dated August 4, 2003.
  • 3Net proceeds from the offering amounted to approximately $990.9 million.
  • 4The proceeds are earmarked for the redemption of $1.0 billion of Amgen's Senior Floating Rate Notes due 2008.
  • 5The new notes rank equally with Amgen's other existing and future senior unsecured indebtedness.
  • 6A change in control triggering event may allow noteholders to require Amgen to purchase their notes at 101% of the principal amount plus accrued interest.
  • 7The filing includes the Underwriting Agreement, the Indenture, and an Officers' Certificate as exhibits.

Frequently Asked Questions

The main purpose of this filing is to report on Amgen's entry into a material definitive agreement, specifically an underwriting agreement for the issuance and sale of $1 billion in senior notes, and the subsequent creation of a direct financial obligation under these notes.

Amgen raised approximately $990.9 million in net proceeds from the sale of $1 billion aggregate principal amount of its 6.15% Senior Notes due 2018 and 6.90% Senior Notes due 2038. These funds are intended to be used for the redemption of $1.0 billion of its outstanding Senior Floating Rate Notes due 2008.

The newly issued notes consist of $500 million of 6.15% Senior Notes due June 1, 2018, and $500 million of 6.90% Senior Notes due June 1, 2038. Interest will be paid semi-annually, starting December 1, 2008. The notes are senior unsecured debt and include a provision allowing noteholders to require Amgen to repurchase their notes at 101% of the principal amount plus accrued interest in the event of a change in control triggering event.

The new notes rank equally in right of payment with Amgen's other existing and future senior unsecured indebtedness. They are senior to any subordinated indebtedness and effectively subordinated to the obligations of Amgen's subsidiaries and subordinated to its secured obligations to the extent of the assets securing such obligations.