On August 10, 2018, Starbucks Corporation (
Starbucks
or the
Company
) completed a public offering pursuant to an
underwriting agreement (the
Underwriting Agreement
) with Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan Stanley & Co. LLC, as
representatives of the several underwriters named therein, under which Starbucks agreed to issue and sell to the several underwriters (i) $1,250,000,000 aggregate principal amount of its 3.800% Senior Notes due 2025 (the
2025
Notes
), (ii) $750,000,000 aggregate principal amount of its 4.000% Senior Notes due 2028 (the
2028 Notes
) and (iii) $1,000,000,000 aggregate principal amount of its 4.500% Senior Notes due 2048 (the
2048
Notes
and, together with the 2025 Notes and the 2028 Notes, the
Notes
).
The Notes are being issued under the Indenture,
dated as of September 15, 2016 (the
Base Indenture
), by and between the Company and U.S. Bank National Association, as trustee (the
Trustee
), as supplemented by the Fourth Supplemental Indenture, dated as
of August 10, 2018 (the
Fourth Supplemental Indenture
and, together with the Base Indenture, the
Indenture
), by and between the Company and the Trustee.
Starbucks will pay interest on the 2025 Notes on each February 15 and August 15, beginning on February 15, 2019. The 2025 Notes will mature on
August 15, 2025. At any time prior to June 15, 2025 (two months prior to the maturity date of the 2025 Notes), Starbucks may redeem the 2025 Notes at a redemption price equal to 100% of the principal amount of such series, plus a
make whole premium as described in the Indenture and accrued and unpaid interest. At any time on and after June 15, 2025, Starbucks may redeem the 2025 Notes at par, plus accrued and unpaid interest.
Starbucks will pay interest on the 2028 Notes on each May 15 and November 15, beginning on November 15, 2018. The 2028 Notes will mature on
November 15, 2028. At any time prior to August 15, 2028 (three months prior to the maturity date of the 2028 Notes), Starbucks may redeem the 2028 Notes at a redemption price equal to 100% of the principal amount of such series, plus a
make whole premium as described in the Indenture and accrued and unpaid interest. At any time on and after August 15, 2028, Starbucks may redeem the 2028 Notes at par, plus accrued and unpaid interest.
Starbucks will pay interest on the 2048 Notes on each May 15 and November 15, beginning on November 15, 2018. The 2048 Notes will mature on
November 15, 2048. At any time prior to May 15, 2048 (six months prior to the maturity date of the 2048 Notes), Starbucks may redeem the 2048 Notes at a redemption price equal to 100% of the principal amount of such series, plus a
make whole premium as described in the Indenture and accrued and unpaid interest. At any time on and after May 15, 2048, Starbucks may redeem the 2048 Notes at par, plus accrued and unpaid interest.
In addition, upon the occurrence of a change of control triggering event relating to a particular series of the Notes (which involves the occurrence of both a
change of control and a below investment grade rating of the applicable series of the Notes by Moodys and S&P), Starbucks will be required to make an offer to repurchase such series of the Notes at a price equal to 101% of the principal
amount of such series of the Notes, plus accrued and unpaid interest.
The Notes will be the Companys senior unsecured obligations and will rank
equally in right of payment with all of the Companys other senior unsecured indebtedness, whether currently existing or incurred in the future. The Notes will be effectively subordinated to any existing or future indebtedness or other
liabilities, including trade payables, of any of the Companys subsidiaries. The Notes are subject to customary covenants and events of default, as set forth in the Indenture.
The foregoing disclosure is qualified in its entirety by reference to the Base Indenture and the Fourth Supplemental Indenture. The Base Indenture was filed
as Exhibit 4.1 to the Companys Registration Statement on Form
S-3
(SEC Registration
No. 333-213645)
(the
Registration Statement
) and is
incorporated herein by reference. The Fourth Supplemental Indenture is attached hereto as Exhibit 4.2 and incorporated herein by reference.