HP Inc. (“HP”) (NYSE:HPQ) today announced it has commenced a cash
tender offer (the “Tender Offer”) to purchase outstanding debt
securities of HP:
- Up to a combined aggregate principal amount of the notes listed
in the table below (collectively, the “Notes,” and each a “Series”
of Notes) from each registered holder of the applicable Series of
Notes (each, a “Holder,” and collectively, the “Holders”) equal to
$1,750,000,000 (the “Maximum Amount”), subject to certain
acceptance priority levels and the applicable Maximum Tender
SubCaps, each as specified in the table below.
- HP remains committed to a strong balance sheet, maintaining an
investment grade credit rating, and a more balanced long-term debt
maturity profile.
Title of Security |
CUSIP / ISIN |
Aggregate Principal Amount
Outstanding |
Maximum Tender SubCap |
Acceptance Priority Level |
Early Tender Premium (1) |
Reference Security |
Bloomberg Reference Page |
Fixed Spread |
HypotheticalTotal Consideration (1) (2) (3)
(4) |
4.650% Global Notes due December 9, 2021 |
428236BV4/ US428236BV43 |
$1,500,000,000 |
$1,750,000,000 |
1 |
$30 |
2.250% U.S. Treasury Notes due February 15, 2021 |
FIT1 |
55 bps |
$1,058.82 |
4.375% Global Notes due September 15, 2021 |
428236BQ5/ US428236BQ57 |
$1,000,000,000 |
2 |
$30 |
2.250% U.S. Treasury Notes due February 15, 2021 |
FIT1 |
55 bps |
$1,046.32 |
4.300% Global Notes due June 1, 2021 |
428236BM4/ US428236BM44 |
$1,250,000,000 |
3 |
$30 |
2.250% U.S. Treasury Notes due February 15, 2021 |
FIT1 |
50 bps |
$1,041.90 |
4.050% Global Notes due September 15, 2022 |
428236BX0/ US428236BX09 |
$500,000,000 |
$450,000,000 |
4 |
$30 |
2.625% U.S. Treasury Notes due February 28, 2023 |
FIT1 |
55 bps |
$1,036.06 |
3.750% Global Notes due December 1, 2020 |
428236BF9/ US428236BF92 |
$648,781,000 |
5 |
$30 |
2.250% U.S. Treasury Notes due February 29, 2020 |
FIT1 |
55 bps |
$1,024.34 |
6.000% Global Notes due September 15, 2041 |
428236BR3/ US428236BR31 |
$1,200,000,000 |
$300,000,000 |
6 |
$30 |
2.750% U.S. Treasury Notes due November 15, 2047 |
FIT1 |
225 bps |
$1,082.63 |
2.750% Global Notes due January 14, 2019 |
428236BY8/ US428236BY81 |
$299,794,000 |
N/A |
7 |
$30 |
1.125% U.S. Treasury Notes due January 15, 2019 |
FIT4 |
20 bps |
$1,003.80 |
(1) Per $1,000 principal amount of Notes. |
(2) Includes a consent fee for the Consents with respect to
the 4.650% Notes. |
(3) Includes the Early Tender Premium per $1,000 principal
amount of Notes for each Series as set forth in this table. |
(4) Hypothetical Total Consideration as of 11:00 a.m., New
York City time, on March 8, 2018 and assuming Initial
Settlement Date of March 26, 2018. |
Indicative timetable for the Tender Offer: |
Event |
Calendar Date
and Time |
Commencement |
March 9, 2018 |
Early Tender
Deadline |
5:00 p.m., New York
City time, on March 22, 2018, unless extended with respect to one
or more Series of Notes. |
Withdrawal
Deadline |
5:00 p.m., New York
City time, on March 22, 2018, except in certain limited
circumstances where additional withdrawal rights are required by
law. |
Price Determination
Date |
11:00 a.m., New York
City time, on March 23, 2018, unless extended with respect to one
or more Series of Notes. |
Initial Settlement
Date |
Promptly after the
Early Tender Deadline. Expected to be March 26, 2018, but
subject to change. |
Expiration Time |
11:59 p.m., New York
City time, on April 5, 2018, unless extended with respect to one or
more Series of Notes. |
Final Settlement
Date |
Promptly after the
Expiration Time. Expected to be April 6, 2018, the first
business day following the Expiration Time, but subject to
change. |
|
In connection with the Tender Offer, HP also commenced a
solicitation (the “Consent Solicitation”) of consents (the
“Consents”) from Holders of HP’s 4.650% Global Notes due
December 9, 2021 (the “4.650% Notes”) to amend certain
provisions (the “Proposed Amendments”) of the Senior Debt
Securities Indenture dated as of June 1, 2000 (the “Indenture”)
under which the 4.650% Notes were issued and as it relates to the
4.650% Notes. The Proposed Amendments would amend the
applicable Indenture as described in the Offer to Purchase to,
among other things, eliminate substantially all of the restrictive
covenants under the Indenture exclusively with respect to the
4.650% Notes. The Proposed Amendments must be consented to by
Holders of a majority in principal amount of the outstanding 4.650%
Notes issued under the Indenture in order to be adopted with
respect to the 4.650% Notes.
The complete terms of the Tender Offer and the Consent
Solicitation are set forth in the Offer to Purchase and Consent
Solicitation Statement dated March 9, 2018 (as it may be
amended or supplemented from time to time, the “Offer to Purchase”)
and in the accompanying Consent and Letter of Transmittal (the
“Letter of Transmittal”). Consummation of the Tender Offer
and the Consent Solicitation is subject to a number of conditions,
including the absence of certain adverse legal and market
developments. Subject to applicable law, HP may waive any and
all of these conditions or extend, terminate or withdraw the Tender
Offer and/or the Consent Solicitation with respect to one or more
Series of Notes and/or increase or decrease the Maximum Amount
and/or any Maximum Tender SubCap. The Tender Offer is neither
conditioned upon any minimum amount of Notes being tendered nor on
the satisfaction of the conditions to the Consent
Solicitation. There are no guaranteed delivery provisions
applicable to the Tender Offer or the Consent Solicitation.
The Tender Offer and the Consent Solicitation will expire at
11:59 p.m., New York City time, on April 5, 2018, unless
extended (such date and time, as the same may be extended, the
“Expiration Time”). Holders of Notes must validly tender and
not validly withdraw their Notes and, with respect to the 4.650%
Notes, validly deliver and not validly revoke Consents to the
Proposed Amendments to the Indenture, at or before 5:00 p.m., New
York City time, on March 22, 2018, unless extended (such date
and time, as the same may be extended, the “Early Tender
Deadline”), to be eligible to receive the applicable Total
Consideration (as set forth in the table above) for their tendered
Notes, which includes an early tender payment of $30 per $1,000
principal amount of the Notes accepted for purchase (the “Early
Tender Premium”) as set forth in the table above. The “Total
Consideration” for each $1,000 principal amount of Notes of any
Series tendered and accepted for purchase pursuant to the Tender
Offer will be determined in the manner described in the Offer to
Purchase by reference to the applicable fixed spread (the “Fixed
Spread”) specified for such Series (as set forth in the table
above) over the yield (the “Reference Yield”) corresponding to the
bid-side price of the applicable Reference U.S. Treasury Security
specified for such Series in the table above (the “Reference U.S.
Treasury Security”), as calculated by BofA Merrill Lynch and
Citigroup Global Markets Inc. at 11:00 a.m., New York City time, on
March 23, 2018 (such time and date, as the same may be extended,
the “Price Determination Time”). Assuming the Tender Offer
and Consent Solicitation are not extended and the conditions to the
Tender Offer and Consent Solicitation are satisfied or waived, HP
expects that settlement for Notes validly tendered and not validly
withdrawn on or before the Early Tender Deadline (the “Initial
Settlement Date”) will be on March 26, 2018, and that
settlement for Notes validly tendered after the Early Tender
Deadline and on or before the Expiration Time will be on
April 6, 2018. Notes tendered may be validly withdrawn,
and Consents may be validly revoked, at any time on or before 5:00
p.m., New York City time, on March 22, 2018 (such time and
date, as the same may be extended, the “Withdrawal Deadline”), but
not thereafter, except in certain limited circumstances where
additional withdrawal rights are required by law.
Holders of Notes who validly tender and do not validly withdraw
their Notes and, with respect to the 4.650% Notes, validly deliver
and do not validly revoke their Consents, after the Early Tender
Deadline and on or before the Expiration Time will be eligible to
receive the applicable Tender Consideration (as set forth in the
table above) per $1,000 principal amount of Notes tendered by such
Holder that are accepted for purchase, which is equal to the
applicable Total Consideration minus the Early Tender Premium.
Holders whose Notes are accepted for purchase pursuant to the
Tender Offer will also receive accrued and unpaid interest on their
purchased Notes from the last interest payment date for such Notes
to, but excluding, the applicable settlement date.
In addition, HP will only accept for purchase (I) a combined
aggregate principal amount of $1,750,000,000 (such aggregate
principal amount, subject to, from time to time, increase, decrease
or elimination by HP at its own discretion, the “First Maximum
Tender SubCap”) of (i) 4.650% Notes, (ii) 4.375% Global Notes due
September 15, 2021 (the “4.375% Notes”), and (iii) 4.300%
Global Notes due June 1, 2021 (the “4.300% Notes” and,
together with the 4.650% Notes and the 4.375% Notes, the “First
Maximum Tender SubCap Notes”), (II) a combined aggregate principal
amount of $450,000,000 (such aggregate principal amount, subject
to, from time to time, increase, decrease or elimination by HP at
its own discretion, the “Second Maximum Tender SubCap”) of (i)
4.050% Global Notes due September 15, 2022 (the “4.050%
Notes”), and (ii) 3.750% Global Notes due December 1, 2020 (the
“3.750% Notes” and, together with the 4.050% Notes, the “Second
Maximum Tender SubCap Notes”), and (III) an aggregate principal
amount of $300,000,000 (such aggregate principal amount, subject
to, from time to time, increase, decrease or elimination by HP at
its own discretion, the “Third Maximum Tender SubCap”) of the
6.000% Global Notes due September 15, 2041 (the “6.000% Notes” or
the “Third Maximum Tender SubCap Notes” and, together with the
First Maximum Tender SubCap Notes and the Second Maximum Tender
SubCap Notes, the “Maximum Tender SubCap Notes”), each subject to
the applicable Acceptance Priority Levels and the Maximum
Amount.
Any Holder who tenders 4.650% Notes pursuant to the Tender Offer
must also deliver a Consent to the Proposed Amendments pursuant to
the related Consent Solicitation. Holders who validly tender their
4.650% Notes pursuant to the Tender Offer will be deemed to have
delivered their Consents pursuant to the Consent Solicitation by
virtue of such tender. Holders of 4.650% Notes may not deliver
Consents without also tendering their 4.650% Notes. A Holder
may not revoke a Consent without withdrawing the previously
tendered 4.650% Notes. 4.650% Notes tendered and Consents
delivered prior to the Withdrawal Deadline may be validly withdrawn
and validly revoked, respectively, at any time prior to the
Withdrawal Deadline, but not thereafter (except in certain limited
circumstances where additional withdrawal rights are required by
law). A valid withdrawal of tendered 4.650% Notes prior to
the Withdrawal Deadline will constitute the concurrent valid
revocation of such Holder’s Consents. Notes tendered and
Consents delivered after the Withdrawal Deadline may not be validly
withdrawn or validly revoked at any time (except in certain limited
circumstances where additional withdrawal rights are required by
law).
The amount of each Series of Notes that is purchased pursuant to
the Tender Offer on any settlement date will be determined in
accordance with the acceptance priority levels specified in the
table above and on the cover page of the Offer to Purchase in the
column entitled “Acceptance Priority Level” (the “Acceptance
Priority Level”), with 1 being the highest Acceptance Priority
Level and 7 being the lowest Acceptance Priority Level.
HP reserves the right to increase or decrease the Maximum Amount
and/or any Maximum Tender SubCap at its own discretion. If Holders
tender more Notes than they expect to be accepted for purchase by
HP, based on the Acceptance Priority Level of the Notes being
tendered, and HP subsequently accepts more of such Notes tendered
and not validly withdrawn on or before the Withdrawal Deadline,
such Holders will not be able to withdraw any of their previously
tendered Notes. Accordingly, Holders should not tender any Notes
that they do not wish to be accepted for purchase.
All Notes validly tendered and not validly withdrawn, and all
Consents validly delivered and not validly revoked, on or before
the Early Tender Deadline having a higher Acceptance Priority Level
will be accepted before any tendered Notes having a lower
Acceptance Priority Level are accepted in the Tender Offer, and all
Notes validly tendered, and all Consents validly delivered and not
validly revoked, after the Early Tender Deadline having a higher
Acceptance Priority Level will be accepted before any Notes
tendered after the Early Tender Deadline having a lower Acceptance
Priority Level are accepted in the Tender Offer. Notes validly
tendered and not validly withdrawn, and Consents validly delivered
and not validly revoked, on or before the Early Tender Deadline
will be accepted for purchase in priority to other Notes tendered,
with Consents validly delivered, after the Early Tender Deadline,
even if such Notes tendered after the Early Tender Deadline have a
higher Acceptance Priority Level than the Notes tendered on or
before the Early Tender Deadline.
If purchasing all of the tendered Notes of a Series on any
settlement date would cause the Maximum Amount and/or the
applicable Maximum Tender SubCap to be exceeded, the amount of that
Series of Notes purchased on that settlement date will be prorated
based on the aggregate principal amount of that Series of Notes
tendered in respect of that settlement date such that the Maximum
Amount and/or the applicable Maximum Tender SubCap will not be
exceeded. Furthermore, if the amount of Notes validly tendered and
not validly withdrawn and, with respect to the 4.650% Notes, the
Consents validly delivered and not validly revoked, on or prior to
the Early Tender Deadline exceeds the Maximum Amount and/or the
applicable Maximum Tender SubCap, Holders who validly tender Notes
after the Early Tender Deadline will not have any of their Notes
accepted for purchase regardless of the Acceptance Priority Level
of such Notes.
Subject to applicable law, the Tender Offer and the
Consent Solicitation may be amended, extended, terminated or
withdrawn with respect to one or more Series of Notes at any time.
If the Tender Offer is terminated with respect to any Series of
Notes without Notes of such Series being accepted for purchase,
Notes of such Series tendered pursuant to the Tender Offer will
promptly be returned to the tendering Holders. Notes tendered
pursuant to the Tender Offer and not purchased due to the priority
acceptance procedures or due to proration will be returned to the
tendering Holders promptly following the Expiration Time or, if the
Tender Offer is fully subscribed as of the Early Tender Deadline,
promptly following the Early Tender Deadline.
HP’s obligation to accept for purchase, and to pay for, validly
tendered and not validly withdrawn Notes (with Consents validly
delivered and not validly revoked with respect to the 4.650%
Notes), and accepted for purchase pursuant to the Tender Offer and
Consent Solicitation, is subject to, and conditioned upon,
satisfaction or, where applicable, waiver of the conditions to the
Tender Offer and the Consent Solicitation described in the Offer to
Purchase.
This news release is neither an offer to purchase nor a
solicitation of an offer to sell securities. No offer,
solicitation, purchase or sale will be made in any jurisdiction in
which such offer, solicitation, or sale would be unlawful. The
Tender Offer and the Consent Solicitation are being made solely
pursuant to terms and conditions set forth in the Offer to Purchase
and the Letter of Transmittal.
BofA Merrill Lynch and Citigroup Global Markets Inc. are serving
as the Dealer Managers and the Solicitation Agents in connection
with the Tender Offer and the Consent Solicitation. Questions
regarding the terms of the Tender Offer and the Consent
Solicitation should be directed to BofA Merrill Lynch at (888)
292-0070 (toll free) or (980) 387-3907 (collect) or to Citigroup
Global Markets Inc. at (800) 558-3745 (toll free) or (212) 723-6106
(collect). Any questions or requests for assistance or
additional copies of the Offer to Purchase and the Letter of
Transmittal or the documents incorporated by reference therein may
be directed to Global Bondholder Services Corporation, which is
acting as the Tender Agent and the Information Agent for the Tender
Offer and the Consent Solicitation, at the following telephone
numbers: banks and brokers at (212) 430-3774 (collect); all others
at (866) 924-2200 (toll free).
Forward-Looking Statements
This news release contains forward-looking statements that
involve risks, uncertainties and assumptions. All statements
other than statements of historical fact are statements that could
be deemed forward-looking statements, including, but not limited
to, statements about the expected timing, size or other terms of
the Tender Offer and the Consent Solicitation and HP’s ability to
complete the Tender Offer and the Consent Solicitation. These
forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond HP’s control, which could
cause HP’s actual results to differ materially from those indicated
in HP’s forward-looking statements. Please see the Cautionary
Statement Regarding Forward-Looking Statements in the Offer to
Purchase, as well as other risks that are described in HP’s Annual
Report on Form 10-K for the fiscal year ended October 31, 2017, and
HP’s other filings with the U.S. Securities and Exchange
Commission. HP disclaims and does not undertake any obligation to
update or revise any forward-looking statement in this news
release, except as required by applicable law or regulation.
About HP Inc.
HP Inc. creates technology that makes life better for everyone,
everywhere. Through our portfolio of printers, PCs, mobile devices,
solutions, and services, we engineer experiences that amaze. More
information about HP Inc. (NYSE:HPQ) is available at
http://www.hp.com.
© Copyright 2018 HP Development Company, L.P. The information
contained herein is subject to change without notice. The only
warranties for HP Inc. products and services are set forth in the
express warranty statements accompanying such products and
services. Nothing herein should be construed as constituting an
additional warranty. HP Inc. shall not be liable for technical or
editorial errors or omissions contained herein.
Editorial contacts
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