Allegro MicroSystems Enters Material Definitive Agreement

TL;DR

Allegro MicroSystems just signed a big deal with a new financial obligation.

AI Summary

On August 6, 2024, Allegro MicroSystems, Inc. entered into a Material Definitive Agreement related to a direct financial obligation. The filing details the creation of this obligation under an off-balance sheet arrangement. Specific details regarding the nature of the agreement and the financial obligation are not fully disclosed in the provided text, but it constitutes a significant event for the company.

Why It Matters

This filing indicates a new material agreement and potential financial obligation for Allegro MicroSystems, which could impact its financial structure and future operations.

Risk Assessment

Risk Level: medium — The creation of a material definitive agreement and a direct financial obligation can introduce new financial risks and operational complexities for the company.

Key Players & Entities

• Allegro MicroSystems, Inc. (company) — Registrant
• August 6, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share ALGM The Nasdaq Stock Mar
• $400 million — The Second Amendment provides for a new $400 million tranche of term loans maturing in 2030

Filing Documents

• dp216206_8k.htm (8-K) — 27KB
• dp216206_ex1001.htm (EX-10.1) — 2148KB
• 0000950103-24-011823.txt ( ) — 2732KB
• algm-20240806.xsd (EX-101.SCH) — 3KB
• algm-20240806_lab.xml (EX-101.LAB) — 33KB
• algm-20240806_pre.xml (EX-101.PRE) — 22KB
• dp216206_8k_htm.xml (XML) — 3KB

01. Entry into a Material Definitive Agreement

Item 1.01. Entry into a Material Definitive Agreement. Term Loan Increase and Refinancing On August 6, 2024, Allegro MicroSystems, Inc. (the "Company", "our" or "us") entered into an Amendment No. 2 (the "Second Amendment") to the Credit Agreement, dated as of June 21, 2023 (as amended by Amendment No. 1, dated as of October 31, 2023 and as further amended, restated, supplemented or otherwise modified, refinanced or replaced from time to time, the "Credit Agreement"), by and among the Company, Allegro MicroSystems, LLC, the lending institutions from time to time party thereto and Morgan Stanley Senior Funding, Inc. as the Administrative Agent and the Collateral Agent. Capitalized terms used herein, but not otherwise defined herein, are as defined in the Credit Agreement as amended by the Second Amendment. The Second Amendment provides for a new $400 million tranche of term loans maturing in 2030 (the "Increased and Refinanced Loans"), the proceeds of which were used, in relevant part, to (i) repurchase a portion of the Company's common stock, par value $0.01 per share, pursuant to that certain Share Repurchase Agreement (the "Share Repurchase Agreement"), dated as of July 23, 2024, between the Company and Sanken Electric Co., Ltd. ("Sanken"), (ii) refinance all outstanding Existing Amendment No. 1 Term Loans, (iii) pay fees and expenses in connection with the foregoing and (iv) for general corporate purposes. The Increased and Refinanced Loans will amortize at a rate of 1.00% per annum. The Increased and Refinanced Loans will bear interest, at the Company's option, at a rate equal to (i) Term SOFR (as defined in the Credit Agreement) in effect from time to time plus 2.25% or (ii) the highest of (x) the Federal funds rate, as published by the Federal Reserve Bank of New York, plus 0.50%, (y) the prime lending rate or (z) the one-month Term SOFR plus 1.0% in effect from time to time plus 1.25%. The Increased and Refinanced Loans will mature on October 31, 2030.

03 Creation of a Direct Financial Obligation or an Obligation

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The information set forth in Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference into this Item 2.03.

01. Other Events

Item 8.01. Other Events. On August 7, 2024, the Company completed the repurchase of the 10,017,315 remaining shares of the total 38,767,315 shares of its common stock from Sanken pursuant to the terms of the Share Repurchase Agreement concurrently with the receipt of the proceeds from the Increased and Refinanced Loans. The shares repurchased pursuant to the Share Repurchase Agreement will be retired as of the same date.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits Exhibit No. Description 10.1 Amendment No. 2 to the Credit Agreement by and among Allegro MicroSystems, Inc., Allegro MicroSystems, LLC, Morgan Stanley Senior Funding, Inc. and each lender from time to time party thereto, effective as of August 6, 2024. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. ALLEGRO MICROSYSTEMS, INC. Date: August 7, 2024 By: /s/ Derek P. D'Antilio Derek P. D'Antilio Executive Vice President, Chief Financial Officer and Treasurer

View Full Filing

View this 8-K filing on SEC EDGAR