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Subsequent Events
3 Months Ended
Jan. 31, 2012
Subsequent Events [Abstract]  
Subsequent Events

Note 18. Subsequent Events

On February 10, 2012, the parties to the Magma Lawsuits entered into a memorandum of understanding (MOU) in which they agreed on the terms of a proposed settlement of the lawsuits, which would include the dismissal with prejudice of all claims against all of the defendants. Pursuant to the MOU, Magma agreed to make certain additional disclosures concerning Magma's acquisition by Synopsys, which supplemented the information provided in Magma's proxy statement filed with the Securities and Exchange Commission on January 10, 2012, and to pay certain legal fees and expenses of plaintiffs' counsel. The MOU contemplates that the parties will enter into a stipulation of settlement. The stipulation of settlement will be subject to customary conditions, including court approval following notice to Magma's stockholders.

 

On February 17, 2012, the Company entered into an amended and restated credit agreement with several lenders (the "Credit Agreement") providing for (i) a $350.0 million senior unsecured revolving credit facility and (ii) a $150.0 million senior unsecured term loan facility. The Credit Agreement amends and restates the Company's previous credit agreement providing for the credit facility referred to in Note 8, in order to add a new term loan facility to finance a portion of the purchase price for the acquisition of Magma on February 22, 2012. Other than the inclusion of the new term loan facility, the terms and conditions of the Credit Agreement are substantially similar to the previous credit agreement. The Credit Agreement terminates on October 14, 2016. Subject to obtaining additional commitments from lenders, the principal amount of the loans provided under the Credit Agreement may be increased by the Company by up to an additional $150.0 million. The Credit Agreement contains financial covenants requiring the Company to operate within a maximum leverage ratio and maintain specified levels of cash, as well as other non-financial covenants. Borrowings bear interest at a floating rate based on a margin over the Company's choice of base rates as defined in the Credit Agreement. In addition, commitment fees are payable on the revolving credit facility at rates between 0.150% and 0.300% per year based on the Company's leverage ratio on the daily amount of the revolving commitment. The Company has drawn down $100.0 million under the revolving credit facility and $150.0 million under the term loan facility as of March 6, 2012. The Company expects its borrowings under the Credit Agreement will fluctuate from quarter to quarter.

On February 22, 2012, the Company completed its previously-announced acquisition of Magma. Pursuant to the merger agreement governing the acquisition, each share of Magma common stock issued and outstanding immediately prior to the acquisition was converted into the right to receive $7.35 in cash, without interest, on the terms and subject to the conditions set forth in the merger agreement. In addition, certain equity awards held by employees of Magma were converted into cash or assumed and converted into the Company's equity awards per the terms of the merger agreement. The total merger consideration was approximately $523.1 million, net of cash acquired. The Company funded the acquisition with existing cash and borrowings under the Credit Agreement. The initial accounting for this acquisition is incomplete due to the limited amount of time between the date of the acquisition and the filing of the financial statements.