Item 1.01 Entry into a Material Definitive Agreement
On August 28, 2017, The AES Corporation (the Company or AES) completed its previously announced offering of $500,000,000 aggregate
principal amount of its 5.125% Senior Notes due 2027 (the Notes). J.P. Morgan Securities LLC, Credit Agricole Securities (USA) Inc., Goldman Sachs & Co. LLC and SG Americas Securities, LLC acted as joint book-running managers
for the offering of the Notes.
The public offering price of the Notes was 100.00% of the principal amount. AES intends to use the net proceeds from the
offering of the Notes to fund the concurrent tender offer to purchase its outstanding 8.00% senior notes due 2020 and to pay certain related fees and expenses. If any net proceeds from the offering remain after completion of the tender offer, AES
intends to use such proceeds to retire certain other outstanding indebtedness.
The Notes were offered and sold pursuant to an Underwriting Agreement (the
Underwriting Agreement), dated August 14, 2017, among AES and J.P. Morgan Securities LLC, under AESs automatic shelf registration statement (the Registration Statement) on Form S-3 (Registration
No. 333-209671), filed with the Securities and Exchange Commission (the SEC) on February 23, 2016. AES has filed with the SEC a prospectus supplement, dated August 14, 2017, together with the accompanying prospectus,
dated February 23, 2016, relating to the offer and sale of the Notes.
The Notes were issued on August 28, 2017 pursuant to a Senior Indenture,
dated as of December 8, 1998 (the Base Indenture), as amended and supplemented by a ninth supplemental indenture, dated as of April 3, 2003 (the Ninth Supplemental Indenture) and the twenty-first supplemental
indenture, dated as of August 28, 2017 (the Twenty-First Supplemental Indenture, and together with the Base Indenture and the Ninth Supplemental Indenture, the Indenture), between AES and Deutsche Bank Trust Company
Americas, as successor to Wells Fargo Bank, N.A. and Bank One, National Association (formerly known as The First National Bank of Chicago), as Trustee.
Interest on the Notes accrues at a rate of 5.125% per annum, and interest is payable on March 1 and September 1 of each year, beginning
March 1, 2018. The Notes will mature on September 1, 2027. The Company may redeem all or a part of the Notes on or after September 1, 2022, on any one or more occasions, as described in the Indenture. In addition, at any time prior to
September 1, 2022, the Company may redeem all or a part of the Notes, on any one or more occasions, at a redemption price equal to 100.00% of the principal amount of the Notes to be redeemed plus a make-whole premium as of, and
accrued and unpaid interest, if any, to, but not including, the date of redemption, as described in the Indenture. In addition, at any time and on one or more occasions, on or prior to September 1, 2020, the Company may redeem, in the aggregate
for all such redemptions, up to 35% of the aggregate principal amount of the notes with the net cash proceeds from certain equity offerings at a redemption price equal to 105.125% of the principal amount of the notes to be redeemed, plus accrued and
unpaid interest, if any, to, but not including, the date of redemption, as described in the Indenture.
Upon the occurrence of a Change of Control
Triggering Event (as defined in the Indenture), the Company must offer to repurchase the Notes at a price equal to 101.00% of their principal amount, plus accrued and unpaid interest, if any, to, but not including, the date of repurchase. The
Indenture also contains covenants, subject to certain exceptions, restricting the ability of the Company to incur debt secured by any Principal Property (as defined in the Indenture) or by the debt or capital stock of any subsidiary held by the
Company; to enter into any sale-lease back transactions involving any Principal Property; or to consolidate, merge, convey or transfer substantially all of its assets; as well as other covenants that are customary for debt securities like the Notes.
In addition, the Indenture contains customary events of default.
The above description of the Underwriting Agreement, the Indenture and the Notes is qualified in its entirety by
reference to the Underwriting Agreement, the Indenture and the form of Notes. The Base Indenture has been incorporated by reference as Exhibit 4.3 to the Registration Statement and the Underwriting Agreement has been incorporated by reference
as Exhibit 1.1 to AESs Current Report on Form 8-K filed with the SEC on August 16, 2017. The Twenty-First Supplemental Indenture and form of Notes are attached to this Current Report on Form 8-K as Exhibit 4.1 and Exhibit 4.2,
respectively, and are incorporated by reference into the Registration Statement. An opinion regarding the legality of the Notes is incorporated by reference into the Registration Statement and is attached to this Current Report on Form 8-K as
Exhibit 5.1.