AMKOR TECHNOLOGY, INC. 8-K

What Happened

• On May 5, 2026, Amkor Technology, Inc. announced it issued $1,150,000,000 aggregate principal amount of 0.00% Convertible Senior Notes due July 15, 2031 (the “Notes”) under an indenture with U.S. Bank Trust Company, N.A. as trustee. The amount includes $150.0 million of additional Notes issued upon full exercise of the initial purchasers’ option.
• The Notes bear no regular interest (0.00% coupon) but may accrue special or additional interest up to 0.50% per year in limited circumstances. The initial conversion rate is 9.4013 shares of common stock per $1,000 principal (implied conversion price ≈ $106.37 per share). The Notes are senior unsecured obligations and are guaranteed by the subsidiaries that guarantee Amkor’s 5.875% senior notes due 2033.

Key Details

• Principal and maturity: $1,150,000,000 issued; maturity July 15, 2031; issued May 5, 2026.
• Conversion terms: initial conversion rate 9.4013 shares per $1,000 (≈ $106.37/share); convertible under certain conditions before April 15, 2031 and freely convertible from April 15, 2031 until just before maturity. Company may settle conversions in cash or cash plus shares.
• Redemption and repurchase: Company may redeem notes (subject to conditions) starting May 15, 2029 if stock trades above 130% of conversion price under specified tests; noteholders can require repurchase on certain “Fundamental Change” events.
• Capped-call hedges: Amkor entered capped-call transactions covering the shares underlying the Notes with an initial cap price of $139.50 and an approximate cost of $56.4 million to reduce potential dilution or offset cash conversion payments.

Why It Matters

• This issuance creates a new sizable, senior unsecured obligation on Amkor’s balance sheet ($1.15B), increasing funded debt but with no cash coupon payments, which can preserve near‑term cash flow versus traditional interest-bearing debt.
• The notes are convertible into equity, so they pose potential dilution to existing shareholders if conversions occur; the capped-call transactions reduce some dilution risk up to the cap price but do not eliminate dilution above the cap.
• Redemption features and repurchase rights on Fundamental Change events provide mechanisms that could accelerate cash outflows or conversions in certain scenarios; investors should watch the company’s stock price relative to the conversion and cap prices and monitor future filings for any conversions, redemptions, or related hedging activity.