UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On December 14, 2022, Synopsys, Inc. (“Synopsys”) entered into a Fifth Extension and Amendment Agreement (the “Fifth Amendment”), which amends and restates Synopsys’ previous credit agreement, dated as of January 22, 2021 (as amended and restated, the “Credit Agreement”).
The Fifth Amendment upsizes the existing senior unsecured revolving credit facility from $650 million to $850 million and extends the maturity date of such revolving credit facility from January 22, 2024 to December 14, 2027, which may be further extended at Synopsys’ option. The Credit Agreement also provides an uncommitted incremental revolving loan facility of up to $150 million in the aggregate principal amount. As of the date hereof, there is no outstanding balance under the Credit Agreement.
The Credit Agreement contains a financial covenant requiring that Synopsys maintain a maximum Consolidated Leverage Ratio (as defined in the Credit Agreement, with levels set forth therein), as well as other non-financial covenants. Interest will accrue on the loans at a floating rate based on, at Synopsys’ election, (i) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus an applicable margin or (ii) the greatest of (a) the NYFRB Rate (as defined in the Credit Agreement) plus 0.50%, (b) the one-month Adjusted Term SOFR Rate plus 1% and (c) the prime rate quoted by the Wall Street Journal (such greatest rate, the “ABR”). The applicable margin for Term SOFR Rate based loans ranges from 0.785% to 0.975%, based upon Synopsys’ Consolidated Leverage Ratio. The applicable margin for ABR based loans is 0.00%. In addition to the interest on any outstanding loans, Synopsys is also required to pay a facility fee on the entire portion of the revolving credit facility ranging from 0.09% to 0.15% based on Synopsys’ Consolidated Leverage Ratio on the daily amount of the revolving commitment.
The Credit Agreement contains customary events of default, including payment failures; failure to comply with covenants; failure to satisfy other obligations under the Credit Agreement or related documents; inaccurate representations and warranties; defaults in respect of other material indebtedness; bankruptcy, insolvency and inability to pay debts when due; material judgments; material ERISA defaults; and the invalidity of any guaranty agreement. If any event of default under the Credit Agreement occurs, the Administrative Agent (as defined in the Credit Agreement) or the other lenders under the Credit Agreement may terminate their respective commitments and declare immediately due all borrowings under the Credit Agreement.
The foregoing summary of the Credit Agreement is not complete and is qualified in its entirety by reference to the Credit Agreement (as attached as Exhibit A to the Fifth Amendment, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K).
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information included under Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit Number |
Exhibit Title | |
| 10.1 | Fifth Extension and Amendment Agreement, dated December 14, 2022, among Synopsys as Borrower, the Lenders parties thereto and JPMorgan Chase Bank, N.A., as administrative agent for the lenders. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| SYNOPSYS, INC. | ||||||
| Dated: December 14, 2022 | By: | /s/ John F. Runkel, Jr. | ||||
| John F. Runkel, Jr. | ||||||
| General Counsel and Corporate Secretary | ||||||