(Reuters) -Intel said on Friday it amended the CHIPS Act funding deal with the U.S. Department of Commerce to remove earlier project milestones and received about $5.7 billion in cash sooner than planned.
The move will give Intel more flexibility over the funds.
The amended agreement, which revises a November 2024 funding deal, retains some guardrails that prevent the chipmaker from using the funds for dividends and buybacks, doing certain control-changing deals and from expanding in certain countries.
As part of the deal, Intel issued the U.S. government 274.6 million shares and promised the government the option to buy up to 240.5 million more shares under certain conditions.
Intel said it has set aside 158.7 million shares in an escrow account to be released after the government makes available more CHIPS funds for the Secure Enclave program, designed to expand advanced chips manufacturing.
The company also said it has spent at least $7.87 billion on eligible CHIPS Act-funded projects.
The U.S. government's move to take a 9.9% equity stake in Intel sparked questions about the outlook for corporate America after President Donald Trump said he plans to do other similar deals.
The government's $8.9 billion investment is in addition to the $2.2 billion in grants Intel has previously received, making for a total investment of $11.1 billion, the company has said.
The Intel stake, announced by the U.S. government last week, is an incentive for the chipmaker to retain control of its contract manufacturing business, or foundry, Intel's finance chief David Zinsner said at an investor conference on Thursday.
(Reporting by Jaspreet Singh in Bengaluru and David Shepardson; Editing by Alan Barona)
