Lumentum Holdings Inc. 8-K

What Happened

• On December 19, 2025 (Effective Date), Lumentum Holdings Inc. announced a new senior secured revolving credit agreement providing a $400.0 million facility (with a $23.0 million sublimit for letters of credit). Wells Fargo Bank, N.A. is the administrative and collateral agent. The company filed the 8-K on December 22, 2025.
• As of the Effective Date, Lumentum had no outstanding borrowings or letters of credit under the new facility. Proceeds may be used for working capital and general corporate purposes.

Key Details

• Facility size: $400.0 million total; $23.0 million letters of credit sublimit. Maturity: December 19, 2030 (subject to earlier maturity in certain circumstances tied to convertible notes).
• Interest: Borrowings at company option of (a) base rate + 0.50%–1.50% or (b) term SOFR + 1.50%–2.50%, with margins stepping based on Lumentum’s secured net leverage ratio. Default interest adds 2.00% if an event of default occurs.
• Fees and costs: Quarterly commitment fee on unused capacity of 0.15%–0.35% (based on leverage), plus customary facility fees and breakage costs.
• Covenants & security: Financial covenants tested quarterly — secured net leverage ratio ≤ 3.25:1.00 (temporary 0.50 step-up for four quarters for a material acquisition) and interest coverage ratio ≥ 3.00:1.00. Obligations guaranteed by certain U.S. subsidiaries and secured by substantially all assets (subject to customary exceptions). Lenders may accelerate on customary events of default.

Why It Matters

• Provides Lumentum with an on‑demand source of liquidity and flexibility for working capital and general corporate needs without immediate borrowings. This can support operations, capital allocation, or buffering near-term cash needs.
• Financial covenants and security terms matter to investors because they limit leverage and require the company to maintain certain financial ratios; breaching these could restrict actions (like dividends or acquisitions) or trigger lender remedies. The facility’s pricing is tied to leverage, so higher leverage would increase borrowing costs.