Amazon.com, Inc. Announces Commencement of Exchange Offer and Consent Solicitation for Whole Foods Market, Inc. 5.200% Notes Due 2025
Amazon.com, Inc. (NASDAQ:AMZN) ("Amazon" or the "Company") today announced that it commenced an offer to exchange all validly tendered (and not validly withdrawn) and accepted 5.200% Senior Notes due 2025 (CUSIP Nos. 966837AE6/966837AD8/U96710AA3) (the "Whole Foods Market Notes") issued by Whole Foods Market, Inc. ("Whole Foods Market") for 5.200% Notes due 2025 to be issued by Amazon (the "Amazon Notes"). Amazon filed a Registration Statement on Form S-4 (the "Registration Statement") for the issuance of the Amazon Notes with the Securities and Exchange Commission ("SEC") on November 20, 2017, but the Registration Statement has not yet been declared effective. Completion of the exchange offer and consent solicitation is expected to ease administration of our consolidated indebtedness.
Amazon is also soliciting consent from holders of the Whole Foods Market Notes to amend the indenture governing the Whole Foods Market Notes to, among other things, eliminate (1) substantially all of the restrictive covenants, (2) the change of control provisions, (3) certain requirements that must be met for Whole Foods Market to consolidate, merge or sell all or substantially all of its assets, and (4) certain events of default in the indenture governing the Whole Foods Market Notes so they will no longer apply (collectively, the "Proposed Amendments"). If the Proposed Amendments are adopted, any remaining Whole Foods Market Notes not tendered and exchanged for Amazon Notes will be governed by the amended indenture, which will be less restrictive and afford reduced protections to any remaining holders of Whole Foods Market Notes compared to those currently in place.
The exchange offer and consent solicitation (together, the "Exchange Offer") commenced on November 20, 2017 and expire at 11:59 p.m., New York City time, on December 19, 2017, unless extended (the "Expiration Date").
In exchange for each $1,000 principal amount of Whole Foods Market Notes validly tendered and accepted before 5:00 p.m., New York City time, on December 5, 2017, unless extended (the "Early Participation Date"), and not validly withdrawn, holders of the tendered Whole Foods Market Notes will be eligible to receive the "Total Consideration," which consists of $1,000principal amount of Amazon Notes (which amount includes the "Early Participation Premium" of $30 principal amount of Amazon Notes), and a cash amount of $1.00.
In exchange for each $1,000 principal amount of Whole Foods Market Notes validly tendered and accepted after the Early Participation Date but before the Expiration Date, and not validly withdrawn, holders of the tendered Whole Foods Market Notes will receive only the "Exchange Consideration," which consists of $970 principal amount of Amazon Notes and a cash amount of $1.00.
Holders of the Whole Foods Market Notes may not consent to the Proposed Amendments without tendering their Whole Foods Market Notes in the Exchange Offer and they may not tender their Whole Foods Market Notes for exchange without consenting to the Proposed Amendments. Each Amazon Note issued in exchange for a Whole Foods Market Note will have an interest rate and maturity date that are the same as the current interest rate and maturity date of such tendered Whole Foods Market Note, as well as the same interest payment dates and optional redemption terms. No accrued but unpaid interest will be paid on the Whole Foods Market Notes in connection with the Exchange Offer. The first interest payment for the Amazon Notes issued in the exchange will reflect interest accrued from the most recent interest payment date for such tendered Whole Foods Market Note. Subject to the minimum denominations and minimum consideration amounts as described in the Registration Statement, the principal amount of each Amazon Note will be rounded down, if necessary, to $2,000 or the nearest lesser whole multiple of $1,000 that is larger than $2,000, as applicable, and we will pay cash equal to the remaining portion, if any, of the exchange price of the Whole Foods Market Note. The Amazon Notes will be senior unsecured obligations of Amazon and will rank equally with all of Amazon's other unsecured indebtedness from time to time outstanding.
The dealer manager for the Exchange Offer is:
BofA Merrill Lynch
By Phone
Collect: (980) 387-3907
Toll-Free: (888) 292-0070
By Mail or Hand:
214 North Tryon Street, 14th Floor
Charlotte, North Carolina 28255
Attention: Liability Management Group
The exchange agent and information agent for the Exchange Offer is:
Global Bondholder Services Corporation
By Facsimile (Eligible Institutions Only):
(212) 430-3775 or
By Phone
Toll Free: (866) 470-3900
By Mail or Hand:
New York, New York 10006
Amazon makes the Exchange Offer under the terms and conditions set forth in its preliminary prospectus, dated as of November 20, 2017 (the "Prospectus"), which forms a part of the Registration Statement, and the related Letter of Transmittal and Consent (the "Letter of Transmittal"). Tendered Whole Foods Market Notes, and related consents, may be validly withdrawn at any time before the Expiration Date and Amazon may terminate or withdraw the Exchange Offer at any time for any reason.
The consummation of the Exchange Offer is subject to, and conditional upon, the satisfaction or, where permitted, waiver of the conditions discussed in the Prospectus, including, among other things, the receipt of valid consents to the Proposed Amendments from the holders of at least a majority of the outstanding aggregate principal amount of the Whole Foods Market Notes and the Registration Statement having been declared effective by the SEC.
The Exchange Offer may be made solely under the terms and conditions of the Prospectus, the Letter of Transmittal, and the other related materials. Amazon has filed a Registration Statement for the Amazon Notes with the SEC, but the Registration Statement is not yet effective. The Amazon Notes may not be issued, nor may tenders of Whole Foods Market Notes be accepted, before the time the Registration Statement is declared effective by the SEC.
This press release is not an offer to sell or a solicitation of an offer to buy any of the securities described in this press release and is also not a solicitation of the related consent. These securities will not be sold in any state or other jurisdiction where any offer, solicitation or sale would be unlawful before registration or qualification under the securities laws of any state or other jurisdiction.
About Amazon
Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. Customer reviews, 1-Click shopping, personalized recommendations, Prime, Fulfillment by Amazon, AWS, Kindle Direct Publishing, Kindle, Fire tablets, Fire TV, Amazon Echo, and Alexa are some of the products and services pioneered by Amazon. For more information, visit www.amazon.com/about and follow @AmazonNews.
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements. All statements other than statements of historical fact, including statements regarding guidance, industry prospects, or future results of operations or financial position, made in this press release are forward-looking. We use words such as anticipates, believes, expects, future, intends, and similar expressions to identify forward-looking statements. Forward-looking statements reflect management's current expectations and are inherently uncertain. Actual results could differ materially for a variety of reasons, including, among others, fluctuations in foreign exchange rates, changes in global economic conditions and customer spending, world events, the rate of growth of the Internet, online commerce, and cloud services, the amount thatAmazon invests in new business opportunities and the timing of those investments, the mix of products and services sold to customers, the mix of net sales derived from products as compared with services, the extent to which we owe income or other taxes, competition, management of growth, potential fluctuations in operating results, international growth and expansion, the outcomes of legal proceedings and claims, fulfillment, sortation, delivery, and data center optimization, risks of inventory management, seasonality, the degree to which we enter into, maintain, and develop commercial agreements, proposed and completed acquisitions and strategic transactions, payments risks, and risks of fulfillment throughput and productivity. In addition, the current global economic climate amplifies many of these risks. These risks and uncertainties, as well as other risks and uncertainties that could cause our actual results to differ significantly from management's expectations, are described in greater detail in Amazon's filings with the SEC, including its most recent Annual Report on Form 10-K and subsequent filings. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law, you are advised to consult any additional disclosures we make in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC.
