Walgreens 2015 Annual Report Download - page 97

Former Walgreens Guarantee
Upon issuance, the notes were guaranteed on an unsecured and unsubordinated basis by Walgreens pursuant to a
guarantee agreement dated as of November 20, 2014. Pursuant to the terms of the Guarantee Agreement, such
Guarantee Agreement would automatically terminate, and Walgreens’ obligations thereunder would be
unconditionally released and discharged, if and when (i) the aggregate outstanding principal amount of Capital
Markets Indebtedness, including the Existing Notes, and Commercial Bank Indebtedness (as each such
capitalized term is defined in the Guarantee Agreement), in each case, of Walgreens is less than $2.0 billion and
(ii) Walgreens does not guarantee any Capital Markets Indebtedness (other than the notes or the U.S. Dollar notes
issued on November 18, 2014 described above) or Commercial Bank Indebtedness, in each case, of Walgreens
Boots Alliance. Once released in accordance with its terms, the guarantees will not subsequently be required to
be reinstated. On August 10, 2015, as a result of the redemption of certain notes of Walgreens described below,
the Guarantee Agreement was automatically terminated in accordance with its terms, without penalty to
Walgreens or Walgreens Boots Alliance, and the obligations of Walgreens thereunder were unconditionally
released and discharged.
Redemption Option
Walgreens Boots Alliance may redeem (a) the Euro notes, at any time prior to August 20, 2026 in whole or from
time to time prior to August 20, 2026 in part, (b) the Pound Sterling notes due 2020, at any time prior to October
20, 2020 in whole or from time to time prior to October 20, 2020 in part, and (c) the Pound Sterling notes due
2025, at any time prior to August 20, 2025 in whole or from time to time prior to August 20, 2025 in part, in each
case, at Walgreens Boots Alliance’s option for the sum of accrued and unpaid interest plus at a redemption price
equal to the greater of:
(1) 100% of the principal amount of the notes to be redeemed; and
(2) the sum of the present values of the remaining scheduled payments of principal and interest thereon (not
including any portion of such payments of interest accrued as of the redemption date), discounted to the
redemption date on an annual basis at the applicable Comparable Government Bond Rate, (as defined in the
applicable series of notes), plus 20 basis points for the Euro notes, 20 basis points for the Pound Sterling
notes due 2020 and 20 basis points for Pound Sterling the notes due 2025.
In addition, at any time on or after August 20, 2026 with respect to the Euro notes, October 20, 2020 with respect
to the Pound Sterling notes due 2020, or August 20, 2025 with respect to the Pound Sterling notes due 2025,
Walgreens Boots Alliance may redeem some or all of the applicable series of notes at its option, at a redemption
price equal to 100% of the principal amount of the applicable notes to be redeemed, plus, in every case, accrued
and unpaid interest on the notes to be redeemed to, but excluding, the redemption date.
Change in Control
If Walgreens Boots Alliance experiences a change of control triggering event, unless Walgreens Boots Alliance
has exercised its option to redeem the fixed rate notes or has defeased the notes as described in the indenture,
Walgreens Boots Alliance will be required to offer payment of cash equal to 101% of the aggregate principal
amount of the notes plus accrued and unpaid interest.
$4.0 Billion Note Issuance
On September 13, 2012, Walgreens obtained net proceeds from a public offering of $4.0 billion of notes with
varying maturities and interest rates, the majority of which, at issuance, were fixed rate. The notes are unsecured
senior debt obligations and rank equally with all other unsecured and unsubordinated indebtedness of Walgreens.
On December 31, 2014, Walgreens Boots Alliance fully and unconditionally guaranteed the outstanding notes on
an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured,
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