Micron Technology enters into $600 million incremental term loan

By William Gullotti

Buffalo, N.Y., Jan. 5 – Micron Technology, Inc. entered into a first incremental amendment to its $2.6 billion term loan credit agreement signed Nov. 3 with Wells Fargo Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission on Thursday.

The first incremental amendment did not alter the existing indenture regarding the company’s original term A-1 loans, term A-2 loans or term A-3 loans, instead increasing aggregate commitments by $600 million with identical terms. The aggregate commitments for incremental term loan credit agreement now total $4.4 billion.

$125 million was drawn at closing from the term A-1 loans maturing Nov. 3, 2025, $250 million was drawn from the term A-2 loans maturing Nov. 3, 2026 and $225 million was drawn from the term A-3 loans maturing Nov. 3, 2027.

As previously reported Nov. 3 with the initial signing, the term A-1 loan does not amortize. The term A-2 and A-3 loans each amortize in equal quarterly installments in an amount equal to 1.25% of the original principal amount.

Borrowings bear interest at SOFR plus a credit spread adjustment of 10 basis points plus a spread ranging from 100 bps to 200 bps, depending on the company’s corporate ratings.

The company is required to maintain on a consolidated basis a leverage ratio of total debt to EBITDA as of the last day of each fiscal quarter, not to exceed 3.25x, subject to a temporary four fiscal quarter to 3.75x following certain material acquisitions.

Wells Fargo Securities, LLC, Mizuho Bank, Ltd. and Truist Securities, Inc. acted as joint bookrunners and joint lead arrangers.

Proceeds from the incremental loans will be used for general corporate purposes, which may include capital expenditures.

Micron is a Boise, Idaho-based semiconductor manufacturer.

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