Dow Chemical 2009 Annual Report Download - page 89

Table of Contents
In May 2009, the Company entered into a purchase agreement with the Haas Trusts and Paulson, whereby the Haas Trusts and Paulson agreed to sell to
the Company their shares of the preferred series B in consideration for shares of the Company’s common stock and/or notes at the discretion of the Company.
On May 6, 2009, the Company launched a public offering of 150.0 million shares of its common stock. Included in the 150.0 million shares offered to
the public were 83.3 million shares issued to the Haas Trusts and Paulson in a private transaction in consideration for 1.2 million shares of preferred series B,
at par plus accrued dividends, held by the Haas Trusts and Paulson. Gross proceeds were $2,250 million, of which the Company’s net proceeds (after
underwriting discounts and commissions) were $966 million for the sale of the Company’s 66.7 million shares.
On May 7, 2009, the Company issued $6 billion of debt securities in a public offering. The offering included $1.75 billion aggregate principal amount
of 7.6 percent notes due 2014; $3.25 billion aggregate principal amount of 8.55 percent notes due 2019; and $1 billion aggregate principal amount of
9.4 percent notes due 2039. An aggregate principal amount of $1.35 billion of the 8.55 percent notes due 2019 were offered by accounts and funds managed
by Paulson and the Haas Trusts. These investors received notes from the Company in payment for 1.3 million shares of preferred series B, at par plus
accrued dividends. The Company used the net proceeds received from this offering for refinancing, renewals, replacements and refunding of outstanding
indebtedness, including repayment of a portion of the Term Loan.
Upon the consummation of the above transactions, all shares of preferred series B were retired.
On May 26, 2009, the Company entered into an underwriting agreement and filed the corresponding shelf registration statement to effect the conversion of
preferred series C into the Company’s common stock. On June 9, 2009, following the end of the sale period and determination of the share conversion
amount, the Company issued 31.0 million shares of common stock to the Haas Trusts and all shares of preferred series C were retired.
On August 4, 2009, the Company issued $2.75 billion of debt securities in a public offering. The offering included $1.25 billion aggregate principal
amount of 4.85 percent notes due 2012; $1.25 billion aggregate principal amount of 5.90 percent notes due 2015; and $0.25 billion aggregate principal
amount of floating rate notes due 2011. The Company used the net proceeds received from this offering for refinancing, renewals, replacements and refunding
of outstanding indebtedness, including repayment of a portion of the Term Loan.
On October 1, 2009, the remaining balance of the Term Loan was fully repaid using proceeds from the sale of the Salt business. See Note E to the
Consolidated Financial Statements for more information on the divestiture of the Salt business.
See Notes D, O, V and W to the Consolidated Financial Statements for more information on the acquisition of Rohm and Haas and the corresponding
financing activities.
On June 4, 2009, the preferred partner of Tornado Finance V.O.F., a consolidated foreign subsidiary of the Company, notified Tornado Finance V.O.F.
that the preferred partnership units would be redeemed in full on July 9, 2009 as permitted by the terms of the partnership agreement. On July 9, 2009, the
preferred partnership units and accrued dividends were redeemed for a total of $520 million. See Note U to the Consolidated Financial Statements.
On August 21, 2009, the Company executed a buy-back of 175 million Euro of private placement debt acquired from Rohm and Haas and recognized a
$56 million pretax loss on early extinguishment included in “Sundry income – net.”
Between May and December 2009, the Company issued $640 million in retail medium-term notes with varying maturities in 2014, 2016 and 2019, at
various interest rates averaging 6.45 percent.
On May 1, 2008, the Company issued $800 million in unsecured notes with a coupon rate of 5.70 percent, semi-annual interest payments due every May
and November, and the principal amount due at maturity on May 15, 2018. Between May and December 2008, the Company issued $579 million in retail
medium-term notes with varying maturities in 2013, 2015 and 2018 and at various interest rates averaging 6.15 percent. Net proceeds from the notes were
primarily used to refinance maturing debt. On September 29, 2008, Calvin Capital LLC (“Calvin”), a newly formed wholly owned subsidiary of the
Company, issued a three-year $674 million note payable (“Note”) with a floating rate based on London Interbank Offered
59