Item 1.01. Entry into a Material Definitive Agreement.
Purchase Agreements
On April 24, 2019, Netflix, Inc. (the “Company”) entered into (i) a purchase agreement (the “Dollar Note Purchase Agreement”) with Morgan Stanley & Co. LLC, as representative of the several initial purchasers listed in Schedule 1 thereto (the “Dollar Note Initial Purchasers”), relating to the sale by the Company of $900.0 million aggregate principal amount of its 5.375% Senior Notes due 2029 (the “Dollar Notes”) and (ii) a purchase agreement (the “Euro Note Purchase Agreement” and together with the Dollar Note Purchase Agreement, the “Purchase Agreements”) with Morgan Stanley & Co. International plc, as representative of the several initial purchasers listed in Schedule 1 thereto (the “Euro Note Initial Purchasers” and together with the Dollar Note Initial Purchasers, the “Initial Purchasers”), relating to the sale by the Company of €1.2 billion aggregate principal amount of its 3.875% Senior Notes due 2029 (the “Euro Notes” and together with the Dollar Notes, the “Notes”), in private placements to “qualified institutional buyers” pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and outside the United States pursuant to Regulation S under the Securities Act (the “Offering”). The Company intends to use the net proceeds from the Offering for general corporate purposes, which may include content acquisitions, production and development, capital expenditures, investments, working capital and potential acquisitions and strategic transactions. The Purchase Agreements contain customary representations, warranties and covenants by the Company together with customary closing conditions. Under the terms of the Purchase Agreements, the Company has agreed to indemnify the applicable Initial Purchasers against certain liabilities.
The description of the Purchase Agreements contained in this Current Report on Form8-K is qualified in its entirety by reference to the complete text of the applicable Purchase Agreement, copies of which are filed as Exhibit 10.1 and Exhibit 10.2 hereto and incorporated herein by reference.
Indentures
On April 29, 2019, the Company entered into (i) an indenture, relating to the issuance of the Dollar Notes (the “Dollar Note Indenture”), and (ii) an indenture, relating to the issuance of the Euro Notes (the “Euro Note Indenture” and together with the Dollar Note Indenture, “the “Indentures”), in each case, by and between the Company and Wells Fargo Bank, National Association, as trustee (the “Trustee”).
Each series of Notes matures on November 15, 2029. The Dollar Notes bear interest at a rate of 5.375% per annum and the Euro Notes bear interest at a rate of 3.875% per annum. Interest on each series of Notes is payable semi-annually in arrears on June 15 and December 15 of each year, commencing on December 15, 2019.
The Company may redeem either series of Notes, in whole or in part, at any time prior to the applicable maturity at a price equal to 100% of the principal amount of the Notes of to be redeemed plus a “make-whole” premium and accrued and unpaid interest, if any.
If the Company experiences a change of control triggering event (as defined in the applicable Indenture), the Company must offer to repurchase each series of Notes at a repurchase price equal to 101% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to the applicable repurchase date.
