Credit Facilities

3 Months Ended

Mar. 30, 2012

Credit Facilities [Abstract]

CREDIT FACILITIES

NOTE 8: CREDIT FACILITIES

Harmonic has a bank line of credit facility with Silicon Valley Bank, which provides for borrowings of up to $10.0 million and matures on August 25, 2012. As of March 30, 2012, other than standby letters of credit and guarantees (Note 13), there were no amounts outstanding under the line of credit facility and there were no borrowings during the three months ended March 30, 2012. This facility, which became effective in August 2011, contains a financial covenant that requires Harmonic to maintain a ratio of unrestricted cash, accounts receivable and short term investments to current liabilities (less deferred revenue) of at least 1.75 to 1.00. As of March 30, 2012, the Company’s ratio under that covenant was 3.92 to 1. In the event of noncompliance by Harmonic with the covenants under the facility, including the financial covenant referenced above, Silicon Valley Bank would be entitled to exercise its remedies under the facility, including declaring all obligations immediately due and payable. At March 30, 2012, Harmonic was in compliance with the covenants under the line of credit facility. Borrowings pursuant to the line would bear interest at the bank’s prime rate (3.25% at March 30, 2012) or at LIBOR for the desired borrowing period (an annualized rate of 0.24% for a one month borrowing period at March 30, 2012) plus 1.75%, or 1.99%. Borrowings are not collateralized.