Item 1.01 |
Entry into a Material Definitive Agreement |
On December 11, 2024, Microchip Technology Incorporated, a Delaware corporation (the “Company”), issued $1,000,000,000 aggregate principal amount of its 4.900% Senior Notes due 2028 (the “2028 Notes”) and $1,000,000,000 aggregate principal amount of 5.050% Senior Notes due 2030 (the “2030 Notes” and, together with 2028 Notes, the “Notes”) in a public offering. The Notes are guaranteed by the Subsidiary Guarantors (as defined below) and were offered and sold pursuant to the Company’s shelf registration statement on Form S-3 (No. 333-277512) (the “Registration Statement”) filed with the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”), on February 29, 2024. The net proceeds from the sale of the Notes were approximately $1,992,170,000, after deducting the underwriters’ discount but before other expenses and will be used to repay the Company’s senior term loan facility, a portion of the debt outstanding under the Company’s commercial paper program and to pay fees and expenses related to the offering of the Notes.
The Notes are governed by the Indenture, dated as of February 29, 2024 (the “Base Indenture”), between the Company and Computershare Trust Company, National Association, as trustee (the “Trustee”), as supplemented by the Second Supplemental Indenture, dated as of December 16, 2024 (the “Second Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company, certain subsidiaries of the Company, as guarantors (the “Subsidiary Guarantors”) and the Trustee.
The 2028 Notes will accrue interest from December 16, 2024 and will mature on March 15, 2028. Interest on the 2028 Notes will be payable semi-annually in arrears on March 15 and September 15 of each year, beginning on March 15, 2025.
The 2030 Notes will accrue interest from December 16, 2024 and will mature on February 15, 2030. Interest on the 2030 Notes will be payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2025.
The Company may redeem the 2028 Notes at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1)(a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Second Supplemental Indenture), plus 15 basis points, less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the 2028 Notes to be redeemed, plus, in either case, accrued and unpaid interest, if any, thereon, to, but excluding, the redemption date.
Prior to January 15, 2030 (one month prior to the maturity date for the 2030 Notes) (the “par call date”), the Company may redeem the 2030 Notes at its option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1)(a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2030 Notes matured on the par call date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Second Supplemental Indenture), plus 15 basis points, less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the 2030 Notes to be redeemed; plus, in either case, accrued and unpaid interest thereon to, but excluding, the redemption date. On or after the par call date, the Company may redeem the 2030 Notes in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2030 Notes being redeemed, plus accrued and unpaid interest thereon, if any, to, but excluding, the redemption date.