Debt



As of	May 31, 2018										August 31, 2017
Instrument	Stated Rate		Effective Rate		Current		Long-Term		Total		Current		Long-Term		Total
MMJ Creditor Payments	N/A		6.52	%	$	237	$	259	$	496	$	157	$	474	$	631
Capital lease obligations	N/A		3.80	%	346		605		951		357		833		1,190
2021 MSAC Term Loan	4.42	%	4.65	%	—		—		—		99		697		796
2021 MSTW Term Loan	2.85	%	3.01	%	—		1,993		1,993		—		2,640		2,640
2022 Term Loan B	3.74	%	4.15	%	5		721		726		5		725		730
2023 Notes	5.25	%	5.43	%	—		—		—		—		991		991
2023 Secured Notes	7.50	%	7.69	%	—		—		—		—		1,238		1,238
2024 Notes	5.25	%	5.38	%	—		—		—		—		546		546
2025 Notes	5.50	%	5.56	%	—		515		515		—		515		515
2026 Notes	5.63	%	5.73	%	—		—		—		—		128		128
2032C Notes⁽¹⁾⁽²⁾	2.38	%	5.95	%	504		—		504		—		211		211
2032D Notes⁽¹⁾	3.13	%	6.33	%	77		149		226		—		159		159
2033E Notes⁽¹⁾	1.63	%	1.63	%	43		—		43		202		—		202
2033F Notes⁽¹⁾	2.13	%	4.93	%	123		—		123		278		—		278
2043G Notes⁽¹⁾	3.00	%	6.76	%	10		679		689		—		671		671
IMFT Member Debt	0.00	%	0.00	%	—		969		969		—		—		—
Other notes	1.84	%	2.46	%	109		—		109		164		44		208
					$	1,454	$	5,890	$	7,344	$	1,262	$	9,872	$	11,134

⁽¹⁾

Since the closing price of our common stock exceeded 130% of the conversion price per share for at least 20 trading days in the 30 trading day period ended on March 31, 2018, these notes are convertible by the holders at any time through the calendar quarter ended June 30, 2018. Current debt as of May 31, 2018 included an aggregate of $553 million for the settlement obligation (including principal and amounts in excess of principal) for conversions of certain convertible notes that will settle in cash in the fourth quarter of 2018. Additionally, the closing price of our common stock also exceeded the thresholds for the calendar quarter ended June 30, 2018; therefore, these notes are convertible by the holders at any time through September 30, 2018.


⁽²⁾	The 2032C Notes were classified as current as of May 31, 2018 because the holders can require us to repurchase for cash all or a portion of the 2032C Notes on May 1, 2019.

The carrying values in the table above as of May 31, 2018 include $4 million of principal amount of our 2033E Notes for which we announced we would redeem on June 15, 2018 and $553 million for the aggregate settlement obligation of certain convertible notes that had been converted but not settled. Additionally, in June 2018, we made an irrevocable election under the terms of the 2021 MSTW Term Loan to prepay principal of 25 billion New Taiwan dollars (equivalent to $836 million as of May 31, 2018) on July 6, 2018. These items had an aggregate carrying value of $1.39 billion as of May 31, 2018 that will settle in the fourth quarter of 2018 and reduce the carrying value of our debt.

Debt Prepayments, Repurchases, and Conversions

During the first nine months of 2018, we prepaid, repurchased, and settled conversions of debt with an aggregate of $4.73 billion principal amount. When we receive a notice of conversion for any of our convertible notes and elect to settle in cash any amount of the conversion obligation in excess of the principal amount, the cash settlement obligations become derivative debt liabilities subject to mark-to-market accounting treatment based on the volume-weighted-average price of our common stock over a period of 20 consecutive trading days. Accordingly, at the date of our election to settle a conversion in cash, we reclassify the fair value of the equity component of the converted notes from additional capital to derivative debt liability within current debt in our consolidated balance sheet.

The following table presents the effects of prepayments, repurchases, and conversions of debt in the first nine months of 2018:



Nine months ended May 31, 2018	Decrease in Principal			Increase (Decrease) in Carrying Value			Decrease in Cash			Decrease in Equity			Gain (Loss)
Prepayments and repurchases
2021 MSAC Term Loan	$	(730	)	$	(727	)	$	(730	)	$	—		$	(3	)
2021 MSTW Term Loan	(671		)	(668		)	(671		)	—			(3		)
2023 Notes	(1,000		)	(991		)	(1,046		)	—			(55		)
2023 Secured Notes	(1,250		)	(1,238		)	(1,373		)	—			(135		)
2024 Notes	(550		)	(546		)	(572		)	—			(25		)
2026 Notes	(129		)	(129		)	(139		)	—			(11		)
2033F Notes	(66		)	(63		)	(316		)	(252		)	(1		)
Settled conversions
2032C Notes	(52		)	(49		)	(240		)	(195		)	4
2033E Notes⁽¹⁾	(161		)	(191		)	(491		)	(251		)	(49		)
2033F Notes	(119		)	(114		)	(575		)	(447		)	(14		)
Conversions not settled⁽²⁾
2032C Notes	—			338			—			(264		)	(74		)
2032D Notes	—			64			—			(51		)	(13		)
2033E Notes	—			31			—			(29		)	(3		)
2033F Notes	—			17			—			(14		)	(3		)
2043G Notes	—			6			—			(5		)	(1		)
	$	(4,728	)	$	(4,260	)	$	(6,153	)	$	(1,508	)	$	(386	)


⁽¹⁾	Settlement included issuance of 4 million shares of our treasury stock in addition to payment of cash.


⁽²⁾	As of May 31, 2018, an aggregate of $101 million in principal amount of our convertible notes (with a carrying value of $553 million) had converted but not settled. These notes will settle in cash in the fourth quarter of 2018.

IMFT Member Debt

In the first nine months of 2018, Intel provided debt financing ("IMFT Member Debt") of $969 million to IMFT pursuant to the terms of the IMFT joint venture agreement. IMFT Member Debt bears no interest, matures upon the completion of an auction and sale of assets of IMFT prior to the dissolution, liquidation, or other wind-up of IMFT, and is convertible, at the election of Intel, in whole or in part, into a capital contribution to IMFT. Additionally, to the extent IMFT distributes cash to its members under the terms of the IMFT joint venture agreement, Intel may, at its option, designate any portion of the distribution to be a repayment of the IMFT Member Debt. In the event Intel exercises its right to put its interest in IMFT to us, or if we exercise our right to call from Intel its interest in IMFT, Intel will transfer to Micron any IMFT Member Debt outstanding at the time of the closing of the put or call transaction. (See "Equity – Noncontrolling Interest in Subsidiaries – IMFT" note.)

2022 Senior Secured Term Loan B Repricing Amendment

On October 26, 2017 and April 27, 2018, we amended our 2022 Term Loan B, substantially all of which was treated as a debt modification, to reduce the interest rate margins. As of May 31, 2018, the 2022 Term Loan B bears interest at LIBOR plus 1.75%.

Convertible Senior Notes

As of May 31, 2018, the trading price of our common stock was higher than the initial conversion prices of our convertible notes. As a result, the conversion values for these notes exceeded the principal amounts by $3.21 billion as of May 31, 2018.