Summary
Microsoft Corporation (MSFT) filed an 8-K on August 4, 2016, reporting on the issuance and sale of a substantial aggregate principal amount of senior unsecured notes. On August 1, 2016, the company entered into an Underwriting Agreement for the issuance of notes totaling $17,650,000,000, with maturities ranging from 2019 to 2056 and fixed interest rates between 1.100% and 3.950%. This debt issuance represents a significant capital raising event for Microsoft. The funds are expected to be used for general corporate purposes, though the specific use is not detailed in this filing. Investors should note the long-term nature of some of these notes, indicating a strategic approach to financing Microsoft's operations and future investments. The notes are senior unsecured obligations, ranking equally with other unsecured and unsubordinated debt.
Key Highlights
- 1Microsoft issued $17.65 billion in senior unsecured notes across various maturities.
- 2Note maturities range from 3 years (2019) to 40 years (2056).
- 3Interest rates on the notes range from 1.100% for the shortest maturity to 3.950% for the longest.
- 4The issuance was conducted under an Underwriting Agreement with several major financial institutions acting as representatives.
- 5The notes will be governed by an indenture and a supplemental indenture, with U.S. Bank National Association acting as trustee.
- 6Interest payments are to be made semi-annually.
- 7Microsoft retains the option to redeem the notes under certain circumstances outlined in the Prospectus Supplement.