8-KMaterial AgreementsFinancial EventsExhibits & Filings

MICRON TECHNOLOGY INC 8-K Report, Material Agreement (Dec 8, 2014)

Filed December 8, 2014For Securities:MU

Summary

Micron Technology, Inc. (MU) announced on December 8, 2014, the execution of a new Credit Agreement on December 2, 2014. This agreement establishes a $600 million asset-based revolving credit facility for the company and its domestic subsidiary, Micron Semiconductor Products, Inc. (MSP). The facility, which matures in December 2019, is secured by eligible inventory and accounts receivable. It provides significant flexibility, including the potential to increase the facility size up to $800 million under certain conditions. The primary purpose of this credit facility is to support working capital and general corporate needs. Importantly, as of the filing date, there were no borrowings outstanding, indicating a proactive approach to securing financing without immediate reliance. The credit agreement does not include restrictive financial covenants, such as those limiting dividend payments or restricted payments, offering considerable operational freedom to the company. This new facility enhances Micron's financial flexibility and liquidity.

Key Highlights

  • 1Established a new $600 million asset-based revolving credit facility with a 5-year maturity (December 2, 2019).
  • 2The credit facility can be increased up to $800 million at the borrowers' request if additional commitments are agreed upon by financial institutions.
  • 3The facility is secured by eligible inventory (raw materials, finished goods, work-in-progress) and accounts receivable of Micron and its subsidiary MSP.
  • 4Borrowings under the facility are intended for working capital and general corporate purposes.
  • 5No borrowings were outstanding under the credit facility as of the filing date, indicating strong current liquidity.
  • 6The agreement includes a $100 million letter of credit sublimit and a $40 million discretionary swingline sublimit.
  • 7The credit agreement does not contain financial covenants or restrictions on dividend payments or other restricted payments.

Frequently Asked Questions

The $600 million asset-based revolving credit facility is intended to provide Micron Technology and its subsidiary, Micron Semiconductor Products, Inc., with funding for working capital and general corporate purposes. It enhances the company's financial flexibility.

The credit facility is secured on a first-priority basis by eligible inventory (including raw materials, finished goods, and work-in-process) and eligible accounts receivable of both Micron Technology and Micron Semiconductor Products, Inc., along with certain related assets.

No, the credit agreement notably does not contain any financial covenants. It also does not include covenants that restrict the payment of dividends or other restricted payments by the borrowers, offering significant operational freedom.

As of the filing date of this report (December 8, 2014), there were no borrowings outstanding under the new credit facility. This suggests the company has sufficient liquidity and is proactively securing this line of credit for future needs.