SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 22, 2020
(Exact name of registrant as specified in its charter)
(State or other jurisdiction
100 Winchester Circle
Los Gatos, CA 95032
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number including area code: (408) 540-3700
(Former name or address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
|☐||Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)|
|☐||Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)|
|☐||Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))|
|☐||Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))|
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Name of each exchange
on which registered
Common Stock Par value $0.001 per share
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
|Item 1.01.||Entry into a Material Definitive Agreement.|
On April 23, 2020, 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 $500 million aggregate principal amount of its 3.625% Senior Notes due 2025 (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 €470 million aggregate principal amount of its 3.000% Senior Notes due 2025 (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 Form 8-K is qualified in its entirety by reference to the complete text of the applicable Purchase Agreement, copies of which are filed as Exhibits 10.1 and 10.2 hereto and incorporated herein by reference.
On April 28, 2020, 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 June 15, 2025. The Dollar Notes bear interest at a rate of 3.625% per annum and the Euro Notes bear interest at a rate of 3.000% 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, 2020.
The Company may redeem either series of Notes, in whole or in part, at any time prior to March 15, 2025 at a price equal to 100% of the principal amount of the Notes to be redeemed plus a “make-whole” premium and accrued and unpaid interest, if any. On and after March 15, 2025, the Company may redeem the Notes at 100% of the principal amount plus 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.
Each Indenture contains covenants that, among other things, restrict the ability of the Company and its domestic restricted subsidiaries to:
|•||create certain liens and enter into sale and lease-back transactions;|
|•||create, assume, incur or guarantee certain indebtedness; and|
|•||consolidate or merge with, or convey, transfer or lease all or substantially all of the Company and its subsidiaries assets, to another person.|
These covenants are subject to a number of other limitations and exceptions set forth in the applicable Indenture.
Each Indenture provides for customary events of default, including, but not limited to, failure to pay principal and interest, failure to comply with covenants, agreements or conditions, and certain events of bankruptcy or insolvency involving the Company and its significant subsidiaries. In the case of an event of default arising from specified events of bankruptcy or insolvency, all outstanding Notes under the applicable Indenture will become due and payable immediately without further action or notice. If any other event of default under the applicable Indenture occurs or is continuing, the applicable Trustee or holders of at least 25% in aggregate principal amount of the applicable series of outstanding Notes under the applicable Indenture may declare all the Notes of such series to be due and payable immediately.
The description of the Notes and each Indenture contained in this Current Report on Form 8-K is qualified in its entirety by reference to the complete text of (i) the Indentures which are filed as Exhibits 4.1 and 4.3 hereto and are incorporated herein by reference and (ii) the Form of 3.625% Senior Note due 2025 and the Form of 3.000% Senior Note due 2025, which are filed as Exhibits 4.2 and 4.4, respectively, hereto and are incorporated herein by reference.
|Item 2.03.||Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.|
The information set forth in Item 1.01 above is incorporated herein by reference.
|Item 8.01.||Other Events.|
On April 22, 2020, the Company issued a press release announcing that it proposes to offer approximately $1.0 billion aggregate principal amount of U.S. dollar denominated and euro denominated senior unsecured notes in two series. A copy of the press release is attached as Exhibit 99.1.
On April 23, 2020, the Company issued a press release announcing the pricing of its offering of $500 million aggregate principal amount of its 3.625% Senior Notes due 2025 and €470 million aggregate principal amount of its 3.000% Senior Notes due 2025. A copy of the press release is attached as Exhibit 99.2.
|Item 9.01||Financial Statements and Exhibits.|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
/s/ Spencer Neumann
Chief Financial Officer
Dated: April 28, 2020