Item 1.01. Entry into a Material Definitive Agreement.
Notes Offering
On September 21, 2022, Medtronic Global Holdings S.C.A. ("Medtronic Luxco"), an
indirect wholly owned subsidiary of Medtronic public limited company ("Medtronic
plc"), issued €500,000,000 aggregate principal amount of its 2.625% Senior Notes
due 2025 (the "2025 Notes"), €1,000,000,000 aggregate principal amount of its
3.000% Senior Notes due 2028 (the "2028 Notes"), €1,000,000,000 aggregate
principal amount of its 3.125% Senior Notes due 2031 (the "2031 Notes"), and
€1,000,000,000 aggregate principal amount of its 3.375% Senior Notes due 2034
(the "2034 Notes" and together with the 2025 Notes, the 2028 Notes and the 2031
Notes, the "Notes"), in an underwritten offering (the "Offering") pursuant to a
registration statement on Form S-3 (the "Registration Statement") (File
No. 333-236739) filed with the Securities and Exchange Commission (the
"Commission") on February 28, 2020, and a preliminary prospectus supplement and
prospectus supplement filed with the Commission related to the offering of the
Notes. The Notes are fully and unconditionally guaranteed by Medtronic plc and
Medtronic, Inc., an indirect wholly owned subsidiary of Medtronic plc (the
"Guarantees," and together with the Notes, the "Securities").
Medtronic Luxco expects to receive net proceeds from the Offering of
approximately €3.47, billion, after deducting the underwriting discount and
estimated offering expenses payable by Medtronic Luxco. Medtronic Luxco expects
to use the net proceeds of the Offering to repay at maturity its outstanding
0.00% Senior Notes due 2022, its 0.375% Senior Notes due 2023 and its 0.00%
Senior Notes due 2023 and for general corporate purposes. While Medtronic Luxco
may elect at a later date to repay, redeem or repurchase such notes prior to
maturity, it currently has no intention to repay, redeem or repurchase such
notes prior to maturity.
The Company has applied to list each series of Notes on the New York Stock
Exchange.
Indenture and Agency Agreement
The Notes were issued under an indenture dated as of March 28, 2017 (the "Base
Indenture"), among Medtronic Luxco, Medtronic, Inc., Medtronic plc and
Computershare Trust Company, N.A., as successor to Wells Fargo Bank, N.A., as
trustee (the "Trustee"), as supplemented by the Fifth Supplemental Indenture
dated as of September 21, 2022 (the "Fifth Supplemental Indenture" and together
with the Base Indenture, the "Indenture"), among Medtronic Luxco, Medtronic,
Inc., Medtronic plc, the Trustee and Elavon Financial Services DAC, as paying
agent ("Elavon"), and shall be subject to the Agency Agreement dated as of
September 21, 2022 (the "Agency Agreement") between the Company and Elavon.
The 2025 Notes will mature on October 15, 2025, the 2028 Notes will mature on
October 15, 2028, the 2031 Notes will mature on October 15, 2031 and the 2034
Notes will mature on October 15, 2034. The 2025 Notes will bear interest at a
rate of 2.625% per annum. The 2028 Notes will bear interest at a rate of 3.000%
per annum. The 2031 Notes will bear interest at a rate of 3.125% per annum. The
2034 Notes will bear interest at a rate of 3.375% per annum.
At any time prior to the applicable Par Call Date (as defined below) Medtronic
Luxco will have the right, at its option, to redeem any series of the Notes, in
whole or in part, at any time and from time to time, at a redemption price equal
to the greater of 100% of the principal amount of the Notes to be redeemed and a
specified make-whole redemption price, in either case plus accrued and unpaid
interest to, but not including, the date of redemption. "Par Call Date" means
September 15, 2025 (1 month prior to the maturity date of the 2025 Notes), in
the case of the 2025 Notes; July 15, 2028 (3 months prior to the maturity date
of the 2028 Notes), in the case of the 2028 Notes; July 15, 2031 (3 months prior
to the maturity date of the 2031 Notes), in the case of the 2031 Notes; and
July 15, 2034 (3 months prior to the maturity date of the 2034 Notes), in the
case of the 2034 Notes.
In addition, on and after the applicable Par Call Date, Medtronic Luxco will
have the option to redeem any series of the Notes, in whole at any time or in
part from time to time, at a redemption price equal to 100% of the principal
amount of the Notes to be redeemed, plus accrued and unpaid interest, if any,
to, but excluding, the date of redemption.
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The Notes will be general unsecured senior obligations of Medtronic Luxco and
will rank equally in right of payment with all of Medtronic Luxco's other
existing and future unsecured senior indebtedness and will rank senior to any
subordinated indebtedness that Medtronic Luxco may incur. The Guarantees will
rank equally in right of payment with all of Medtronic plc's and Medtronic,
Inc.'s other existing and future unsecured senior indebtedness and will rank
senior to any subordinated indebtedness from time to time outstanding that
Medtronic plc or Medtronic, Inc. may incur, and be structurally subordinated to
all existing and any future obligations of each of Medtronic plc's subsidiaries
(other than Medtronic Luxco and Medtronic, Inc.).
Upon the occurrence of an event of default with respect to the Notes, which
includes payment defaults, defaults in the performance of certain covenants, and
bankruptcy and insolvency related defaults, Medtronic Luxco's obligations under
the Notes may be accelerated, in which case the entire principal amount of the
Notes would be immediately due and payable.
Medtronic plc and its affiliates maintain ordinary banking relationships and
credit facilities with the Trustee. In addition, the Trustee is the trustee for
certain of Medtronic plc's affiliates' other debt securities, and from time to
time provides services relating to Medtronic plc's investment management, stock
repurchase and foreign currency hedging programs.
The above description of the Base Indenture and the Fifth Supplemental Indenture
is qualified in its entirety by reference to the Base Indenture and the Fifth
Supplemental Indenture. The executed Base Indenture was previously filed as
Exhibit 4.1 to the Current Report on Form 8-K filed by Medtronic plc on
March 28, 2017. The executed Fifth Supplemental Indenture is filed as Exhibit
4.1 hereto. Each of the foregoing documents is incorporated herein and into the
Registration Statement by reference.
Item 7.01. Regulation FD Disclosure.
On September 21, 2022, Medtronic plc issued a press release announcing the
closing of the Offering, the net proceeds of which are expected to be used to
repay at maturity Medtronic Luxco's outstanding 0.00% Senior Notes due 2022, its
0.375% Senior Notes due 2023 and its 0.00% Senior Notes due 2023 and for general
corporate purposes. While Medtronic Luxco may elect at a later date to repay,
redeem or repurchase such notes prior to maturity, it currently has no intention
to repay, redeem or repurchase such notes prior to maturity. The financial
impact from the Offering and the expected use of proceeds was reflected in
Medtronic plc's fiscal year 2023 adjusted earnings per share guidance that
Medtronic plc reiterated on August 23, 2022.
Item 8.01. Other Events.
Underwriting Agreement
On September 15, 2022, Medtronic Luxco, Medtronic plc and Medtronic, Inc.
entered into an underwriting agreement (the "Underwriting Agreement") with the
underwriters listed therein, for which Barclays Bank PLC, BofA Securities Europe
SA, Citigroup Global Markets Limited and HSBC Continental Europe acted as
representatives, to issue and sell the Notes to the underwriters.
Certain of the underwriters party to the Underwriting Agreement and their
respective affiliates have in the past performed commercial banking, investment
banking and advisory services for Medtronic plc and its affiliates from time to
time for which they have received customary fees and reimbursement of expenses
and may, from time to time, engage in transactions with and perform services for
Medtronic plc in the ordinary course of their business for which they may
receive customary fees and reimbursement of expenses. Certain of the
underwriters or their respective affiliates have been or are lenders under one
or more of Medtronic, Inc.'s and Medtronic Luxco's credit facilities.
A copy of the Underwriting Agreement is attached hereto as Exhibit 1.1 and is
incorporated by reference into the Registration Statement. The foregoing
description of the Underwriting Agreement does not purport to be complete and is
qualified in its entirety by reference to such exhibit.
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In connection with the Offering, Medtronic plc is filing as Exhibits 5.1, 5.2,
5.3 and 5.4 hereto opinions of counsel addressing the validity of the Notes and
the Guarantees and certain related matters. Such opinions are incorporated by
reference into the Registration Statement.
Item 9.01. Exhibits.
Exhibit
Number Description
1.1 Underwriting Agreement, dated as of September 15, 2022, among
Medtronic Global Holdings S.C.A., Medtronic plc and Medtronic, Inc.,
and Barclays Bank PLC, BofA Securities Europe SA, Citigroup Global
Markets Limited and HSBC Continental Europe, as representatives of the
several underwriters named therein.
4.1 Fifth Supplemental Indenture, dated as of September 21, 2022, among
Medtronic Global Holdings S.C.A., Medtronic, Inc. and Medtronic plc,
Computershare Trust Company, N.A., as successor to Wells Fargo Bank,
N.A., as trustee, and Elavon Financial Services DAC, as paying agent
(including the forms of the 2025 Notes, the 2028 Notes, the 2031 Notes
and the 2034 Notes).
5.1 Opinion of Wilmer Cutler Pickering Hale and Dorr LLP, U.S. counsel
to Medtronic plc, Medtronic Global Holdings S.C.A. and Medtronic, Inc.
5.2 Opinion of A&L Goodbody, Irish counsel to Medtronic plc.
5.3 Opinion of DLA Piper, Luxembourg counsel to Medtronic Global
Holdings S.C.A.
5.4 Opinion of Thomas L. Osteraas, Legal Director - Corporate and
Securities of Medtronic, Inc.
23.1 Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included in
Exhibit 5.1).
23.2 Consent of A&L Goodbody (included in Exhibit 5.2).
23.3 Consent of DLA Piper (included in Exhibit 5.3).
23.4 Consent of Thomas L. Osteraas, Principal Legal Counsel, Corporate &
Securities of Medtronic, Inc. (included in Exhibit 5.4).
104 Cover Page Interactive Data File (embedded with the Inline XBRL
document).
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