Item 1.01.
Entry into a Material Definitive Agreement.
2.600
% Senior Notes due 2022, 3.400% Senior Notes due 2027 and 4.500% Senior Notes due 2047
On May 26, 2017, Activision Blizzard, Inc. (the Company) completed its previously announced offering of three series of senior unsecured notes in an aggregate principal amount of $1.2 billion, in a public underwritten offering, consisting of $400 million of 2.600% Senior Notes due 2022 (the 2022 Notes), $400 million of 3.400% Senior Notes due 2027 (the 2027 Notes) and $400 million of 4.500% Senior Notes due 2047 (the 2047 Notes and, together with the 2022 Notes and the 2027 Notes, the Notes).
The Notes are the general senior obligations of the Company.
Each series of Notes will be effectively subordinated to all of the Companys future senior secured debt, if any, to the extent of the value of the assets securing such debt. The Notes will not be guaranteed by any of the Companys subsidiaries.
The Notes were offered and sold by the Company pursuant to its automatic shelf Registration Statement on Form S-3 (the Registration Statement) (Registration Statement No. 333-213520), filed with the Securities and Exchange Commission (the SEC) on September 7, 2016, as supplemented by the prospectus supplement dated May 23, 2017.
The Indenture and the Supplemental Indenture
The Notes were issued pursuant to a base indenture, dated May 26, 2017 (the Base Indenture), as supplemented by a supplemental indenture, dated as of May 26, 2017 (the Supplemental Indenture and, together with the Base Indenture, the Indenture), between the Company and Wells Fargo Bank, National Association, as trustee (the Trustee). The 2022 Notes will accrue interest at the rate of 2.600% per year and will mature on June 15, 2022. The 2027 Notes will accrue interest at the rate of 3.400% per year and will mature on June 15, 2027. The 2047 Notes will accrue interest at the rate of 4.500% per year and will mature on June 15, 2047. Interest on the Notes will be payable semi-annually in arrears on each June 15 and December 15. Interest on the Notes will accrue from May 26, 2017.
The 2022 Notes, the 2027 Notes and the 2047 Notes will be redeemable at the option of the Company, in whole or in part, at any time on or after May 15, 2022, March 15, 2027 and December 15, 2046, respectively, in each case at 100% of the aggregate principal amount thereof plus accrued and unpaid interest, if any to, but excluding, the redemption date.
In addition, the Company may redeem some or all of the 2022 Notes, the 2027 Notes and the 2047 Notes prior to May 15, 2022, March 15, 2027 and December 15, 2046, respectively, in each case at a price equal to 100% of the aggregate principal amount thereof plus a make-whole premium and accrued and unpaid interest, if any, to, but excluding, the redemption date.
Upon the occurrence of certain change of control events, the Company will be required to offer to repurchase the Notes at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to, but excluding, the purchase date applicable to such Notes.
The Indenture contains covenants that limit the ability of the Company to create or incur secured indebtedness and the ability of the Company and any of its Restricted Subsidiaries (as such term is defined in the Indenture) to, among other things enter into sale or leaseback transactions and consolidate, merge, sell or otherwise dispose of all or substantially all of the Companys assets.
The Indenture also provides for customary events of default.
The foregoing summaries of the Base Indenture, the Supplemental Indenture, the 2022 Notes, the 2027 Notes and the 2047 Notes are not complete and are qualified in their entirety by reference to the full and complete texts of the Base Indenture, the Supplemental Indenture and the forms of the 2022 Notes, the 2027 Notes and the 2047 Notes, copies of which are attached as Exhibits 4.1, 4.2, 4.3, 4.4 and 4.5, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
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