Business Context and Reporting Period
Company: Amkor Technology, Inc.
Filing Type: Form 8-K (Current Report)
Report Date: April 30, 2026 (Event Date: May 5, 2026)
Context: The Company announced the issuance of convertible senior notes and the entry into related capped call transactions to manage potential dilution.
Key Financial Metrics and Transaction Details
| Metric | Value |
|---|---|
| Aggregate Principal Amount Issued | $1,150,000,000 |
| Instrument Type | 0.00% Convertible Senior Notes due 2031 |
| Initial Conversion Price | Approx. $106.37 per share |
| Initial Conversion Rate | 9.4013 shares per $1,000 principal |
| Maximum Potential Shares Issuable | 16,487,435 shares |
| Capped Call Transaction Cost | Approx. $56.4 million |
| Capped Call Cap Price | $139.50 per share |
| Interest Rate | 0.00% (Special interest up to 0.50% may accrue upon specific events) |
Material Changes and Transaction Structure
- Debt Issuance: On May 5, 2026, the Company issued $1.15 billion in 0.00% Convertible Senior Notes due 2031. This included a full exercise of an option by initial purchasers to purchase an additional $150 million.
- Guarantees: The Notes are fully and unconditionally guaranteed on a senior, unsecured basis by subsidiaries that guarantee the Company's existing 5.875% senior notes due 2033.
- Seniority: The Notes rank equal to existing senior unsecured indebtedness and are effectively subordinated to secured indebtedness.
- Conversion Mechanics: Conversion is restricted before April 15, 2031, except upon specific events. Settlement may be in cash, stock, or a combination thereof, determined by an "Observation Period" of 20 trading days.
- Redemption: The Company may redeem the Notes on or after May 15, 2029, if the stock price exceeds 130% of the conversion price for a specified period.
Outlook, Risks, and Management Commentary
- Dilution Management: The Company entered into Capped Call Transactions with a cost of approximately $56.4 million. These are designed to offset potential dilution and cash payments upon conversion, provided the stock price does not exceed the cap price of $139.50.
- Repurchase Rights: Noteholders have the right to require the Company to repurchase the Notes at par plus accrued interest if a "Fundamental Change" (e.g., business combination or delisting) occurs.
- Events of Default: Includes payment defaults, failure to convert, bankruptcy, and defaults on other indebtedness exceeding $100 million. Certain reporting defaults may be cured by paying special interest rather than triggering immediate acceleration.
- Unregistered Sales: The Notes were sold to qualified institutional buyers under Rule 144A and Section 4(a)(2) of the Securities Act.
Investor Verification Checklist
- Verify the full text of the Indenture (Exhibit 4.1) for specific definitions of "Fundamental Change" and "Make-Whole Fundamental Change."
- Confirm the impact of the $56.4 million cost of Capped Call Transactions on the Company's current cash position and liquidity.
- Review the "Observation Period" mechanics to understand the potential for cash versus stock settlement upon conversion.
- Assess the Company's ability to meet the redemption conditions (stock price >130% of conversion price) if the Company chooses to call the notes after May 2029.
- Monitor the Company's compliance with reporting covenants to avoid the accrual of special interest (up to 0.50%).