MILLERKNOLL, INC.MLKN
MILLERKNOLL, INC. Debt Disclosure
Short-Term Borrowings and Long-Term Debt
Long-term debt consisted of the following obligations:
| (In millions) | May 31, 2025 | June 1, 2024 | |||||||||
Syndicated revolving line of credit, due April 2030 | $ | 330.8 | $ | 390.0 | |||||||
Term Loan A, 6.0768%, due April 2030 | 400.0 | 345.0 | |||||||||
Term Loan B, 6.4413%, due July 2028 | 603.1 | 609.4 | |||||||||
| Supplier financing program | 2.0 | 2.0 | |||||||||
| 1.1 | 1.4 | ||||||||||
| Total debt | $ | 1,337.0 | $ | 1,347.8 | |||||||
| Less: Unamortized discount and issuance costs | (10.4) | (12.6) | |||||||||
| Less: Current debt | (16.0) | (43.5) | |||||||||
| Long-term debt | $ | 1,310.6 | $ | 1,291.7 | |||||||
In connection with the acquisition of Knoll, in July 2021, the Company entered into a credit agreement that provided for a syndicated revolving line of credit (the "Revolver") and two term loans. The Revolver provides the Company with up to $725.0 million in revolving variable interest borrowing capacity that matures in July 2026, replacing the previous $500.0 million syndicated revolving line of credit. The term loans consist of a five-year senior secured "Term Loan A" facility with an aggregate principal amount of $400.0 million and a seven-year senior secured "Term Loan B" facility with an aggregate principal amount of $625.0 million, the proceeds of which were used to finance a portion of the cash consideration for the acquisition of Knoll, for the repayment of certain debt of Knoll, and to pay fees, costs, and expenses related thereto.
In January 2023, the Company entered into an Amendment to the credit agreement which transitioned the benchmark rate from LIBOR to the Secured Overnight Financing Rate ("SOFR") for U.S. dollar borrowings. SOFR is the recommended risk-free reference rate of the Federal Reserve Board and Alternative Reference Rates Committee, as defined within the credit agreement. The indebtedness incurred under the revolving line of credit and term loans is secured by substantially all of the Company’s tangible and intangible assets, including, without limitation, the Company’s intellectual property. The Company’s
direct and indirect wholly-owned domestic subsidiaries have also guaranteed the obligations of the Company and the foreign borrowers under the revolving line of credit and term loans and pledged substantially all of their tangible and intangible assets as security for their obligations under such guarantee.
In April 2025, the Company entered into an amendment to the Credit Agreement. Amended terms for the Revolver and Term Loan A include extending the maturity to April 2030, a new amortization schedule of required quarterly principal payments for Term Loan A, and a higher maximum first lien secured net leverage ratio with no step downs. The Company also increased liquidity by raising the amount borrowed on Term Loan A to $400.0 million and applying excess cash to reduce the outstanding Revolver balance. The Revolver continues to be a $725.0 million facility. In connection with the execution of the amendment, the accounting treatment of Term Loan A and the Revolver was assessed on a lender-by-lender basis in accordance with ASC 470-50. Based on the specific facts and circumstances applicable to each lender in the syndicate, the amendment was accounted for as a modification, extinguishment, or new loan, as appropriate.
The Company made principal payments on Term Loans A and B during the year ended May 31, 2025, in the amount of $35.0 million and $6.3 million, respectively, and during the year ended June 1, 2024, in the amount of $25.0 million and $6.3 million, respectively.
Available borrowings under the syndicated revolving line of credit were as follows for the periods indicated:
| (In millions) | May 31, 2025 | June 1, 2024 | |||||||||
| Syndicated revolving line of credit borrowing capacity | $ | 725.0 | $ | 725.0 | |||||||
| Less: Borrowings under the syndicated revolving line of credit | 330.8 | 390.0 | |||||||||
| Less: Outstanding letters of credit | 12.0 | 12.7 | |||||||||
Available borrowings under the syndicated revolving line of credit | $ | 382.2 | $ | 322.3 | |||||||
The senior secured revolving credit facility restricts, without prior consent, the Company's borrowings, capital leases, investments, liens, mergers, consolidations, restricted payments, and the sale of certain assets. In addition, for the Revolver and Term Loan A, the Company agreed to a maximum first lien secured net leverage ratio covenant which is measured by the ratio of first lien debt (less unrestricted cash) to trailing four quarter adjusted consolidated EBITDA (as defined in the credit agreement) and is required to be less than 4.00:1 for each trailing four quarter period except that the Company may elect, under certain conditions, a step-up in the covenant level of 0.50-1.00 for the four subsequent trailing four quarter periods immediately following a permitted acquisition. Adjusted EBITDA is generally defined in the credit agreement as EBITDA adjusted by certain items which include non-cash share-based compensation, non-recurring restructuring costs and extraordinary items. At May 31, 2025 the Company was in compliance with these restrictions and performance ratios.
Annual maturities of debt for the five fiscal years subsequent to May 31, 2025 are as shown in the table below.
| (In millions) | |||||
| 2026 | $ | 16.0 | |||
| 2027 | 24.1 | ||||
| 2028 | 26.6 | ||||
| 2029 | 612.0 | ||||
| 2030 | 658.3 | ||||
| Thereafter | — | ||||
| Total | $ | 1,337.0 | |||
Supplier Financing Program
The Company has an agreement with a third-party financial institution that allows certain participating suppliers the ability to finance payment obligations from the Company. Under this program, participating suppliers may finance payment obligations of the Company, prior to their scheduled due dates, at a discounted price to the third-party financial institution.
The Company has lengthened the payment terms for certain suppliers that have chosen to participate in the program. As a result, certain amounts due to suppliers have payment terms that are longer than standard industry practice and as such, these amounts have been excluded from "Accounts payable" in the Consolidated Balance Sheets as the amounts have been accounted for by the Company as a current debt, within "Short-term borrowings and current portion of long-term debt". The liability related to the supplier financing program was $2.0 million as of May 31, 2025 and June 1, 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jul 21, 2025 | Showing above |
| 2024 | Jul 30, 2024 | |
| 2023 | Jul 26, 2023 | |
| 2022 | Jul 26, 2022 | |
| 2021 | Jul 27, 2021 | |
| 2020 | Jul 28, 2020 | |
| 2019 | Jul 30, 2019 | |
| 2018 | Jul 31, 2018 | |
| 2017 | Aug 1, 2017 | |
| 2016 | Jul 26, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.