| Item 1.01 | Entry into a Material Definitive Agreement |
On March 30, 2023, Lowe’s Companies, Inc. (the “Company”) issued an aggregate of $3.0 billion of unsecured notes, consisting of $1.0 billion aggregate principal amount of its 4.800% Notes due April 1, 2026 (the “2026 Notes”), $1.0 billion aggregate principal amount of its 5.150% Notes due July 1, 2033 (the “2033 Notes”), $500 million aggregate principal amount of its 5.750% Notes due July 1, 2053 (the “2053 Notes”) and $500 million aggregate principal amount of its 5.850% Notes due April 1, 2063 (the “2063 Notes” and, together with the 2026 Notes, 2033 Notes and 2053 Notes, the “Notes”). The Company received net proceeds, after expenses and the underwriting discount, of approximately $2.978 billion from the issuance of the Notes.
The Notes are governed by and were issued pursuant to the terms of an Amended and Restated Indenture, dated as of December 1, 1995 (the “Base Indenture”), between the Company and U.S. Bank Trust Company, National Association, as successor in interest to U.S. Bank National Association as successor trustee (the “Trustee”), as supplemented by a Twenty-Second Supplemental Indenture, dated as of March 30, 2023, between the Company and the Trustee (the “Twenty-Second Supplemental Indenture” and, the Base Indenture as supplemented by the Twenty-Second Supplemental Indenture, the “Indenture”).
The Notes are unsecured obligations and rank equally with the Company’s existing and future unsecured senior indebtedness. The Indenture contains covenants restricting the issuance of debt by the Company’s subsidiaries but does not restrict the Company from incurring additional indebtedness. Each series of the Notes is a new issue of securities with no established trading market. The Company does not intend to apply for the listing of any series of the Notes on any securities exchange or for quotation of such Notes on any automated dealer quotation system.
The 2026 Notes will mature on April 1, 2026, the 2033 Notes will mature on July 1, 2033, the 2053 Notes will mature on July 1, 2053 and the 2063 Notes will mature on April 1, 2063, in each case, unless earlier redeemed or repurchased by the Company. The 2026 Notes will bear interest at a rate of 4.800% per annum, the 2033 Notes will bear interest at a rate of 5.150% per annum, the 2053 Notes will bear interest at a rate of 5.750% per annum and the 2063 Notes will bear interest at a rate of 5.850% per annum. The Company will pay interest on the Notes semiannually in arrears (i) for the 2026 Notes, on each April 1 and October 1, commencing October 1, 2023; (ii) for the 2033 Notes, on each January 1 and July 1, commencing July 1, 2023, (iii) for the 2053 Notes, on each January 1 and July 1, commencing July 1, 2023 and (iv) for the 2063 Notes, on each April 1 and October 1, commencing October 1, 2023. Interest will be computed on the basis of a 360-day year composed of twelve 30-day months. Payments of principal and interest to owners of book-entry interests will be made in accordance with the procedures of The Depository Trust Company and its participants in effect from time to time.
Prior to March 1, 2026 (with respect to the 2026 Notes), April 1, 2033 (with respect to the 2033 Notes), January 1, 2053 (with respect to the 2053 Notes) and October 1, 2062 (with respect to the 2063 Notes) (each such date, a “Par Call Date”), the Company may redeem the Notes at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a principal amount and rounded to three decimal places) equal to the greater of: (1)(a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming that the Notes matured on the applicable Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Twenty-Second Supplemental Indenture) plus 15 basis points (with respect to the 2026 Notes), 25 basis points (with respect to the 2033 Notes), 30 basis points (with respect to the 2053 Notes) or 35 basis points (with respect to the 2063 Notes), less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the Notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to the redemption date.
On or after the applicable Par Call Date, the Company may redeem the Notes in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest thereon to the redemption date.
In addition, upon a Change of Control Triggering Event (as defined in the Twenty-Second Supplemental Indenture), the holders of the Notes may require the Company to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of their Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest, if any, on such Notes to, but excluding, the date of purchase (unless the Company has exercised its right to redeem the Notes within 30 days of the Change of Control Triggering Event).
