BROADCOM INC. Item 1.01 Entry into a Material Definitive Agreement
On
Pursuant to the Exchange Offers, the aggregate principal amount of each series of the Existing Notes set forth below was validly tendered, accepted for exchange by the Company and subsequently cancelled:
i. $117,133,000 aggregate principal amount of 2.200% Senior Notes due 2021,
issued by Broadcom Corporation , a California corporation ("Broadcom
Corporation ");
ii. $200,499,000 aggregate principal amount of 3.125% Senior Notes due 2021,
issued by the Company;
iii. $297,061,000 aggregate principal amount of 3.000% Senior Notes due 2022,
issued by Broadcom Corporation ;
iv. $216,359,000 aggregate principal amount of 3.600% Senior Notes due 2022,
issued by CA, Inc., a Delaware corporation ("CA, Inc. ");
v. $806,970,000 aggregate principal amount of 3.125% Senior Notes due 2022,
issued by the Company;
vi. $1,146,823,000 aggregate principal amount of 3.625% Senior Notes due 2024,
issued by Broadcom Corporation ; and
vii. $955,389,000 aggregate principal amount of 3.625% Senior Notes due 2024,
issued by the Company.
Following such cancellation, the aggregate principal amount of each series of Existing Notes set forth below remain outstanding:
i. $281,737,000 aggregate principal amount of 2.200% Senior Notes due 2021,
issued by Broadcom Corporation ;
ii. $525,342,000 aggregate principal amount of 3.125% Senior Notes due 2021,
issued by the Company;
--------------------------------------------------------------------------------
iii. $841,913,000 aggregate principal amount of 3.000% Senior Notes due 2022,
issued by Broadcom Corporation ;
iv. $283,641,000 aggregate principal amount of 3.600% Senior Notes due 2022,
issued by CA, Inc.;
v. $693,030,000 aggregate principal amount of 3.125% Senior Notes due 2022,
issued by the Company;
vi. $1,353,177,000 aggregate principal amount of 3.625% Senior Notes due 2024,
issued by Broadcom Corporation ; and
vii. $1,044,611,000 aggregate principal amount of 3.625% Senior Notes due
2024, issued by the Company.
The New Notes and Indenture
In connection with the early settlement of the Exchange Offers, the Company
issued (i)
The New Notes were issued pursuant to an Indenture, dated
Optional Redemption Provisions and Change of Control Purchase Right
The Company may, at its option, redeem or purchase, in whole or in part, the
2026 New Notes and 2028 New Notes at any time prior to
In the event that certain changes in the tax law of any relevant jurisdiction would impose withholding taxes on payments on the New Notes, the Company may redeem a series of New Notes in whole, but not in part, at any time, at a redemption price of 100% of the principal amount, plus accrued and unpaid interest thereon, if any, and Additional Amounts (as defined in the Indenture), if any, to the redemption date.
The holders of the New Notes will also have the right to require the Company to purchase their New Notes upon the occurrence of a Change of Control Triggering Event, as defined in the Indenture, at an offer price equal to 101% of the aggregate principal amount of the New Notes purchased plus accrued and unpaid interest thereon to, but excluding, the date of purchase.
Ranking
Under the terms of the Indenture, the New Notes and the guarantees are the Company's and the Guarantors' respective senior unsecured obligations and (i) rank equal in right of payment with all of the Company's and the Guarantors' respective existing and future senior unsecured indebtedness, (ii) rank senior in right of payment to the Company's and the Guarantors' respective existing and future subordinated indebtedness, (iii) are effectively subordinated in right of payment to the Company's and the Guarantors' respective existing and future secured obligations, to the extent of the assets securing such obligations and (iv) are structurally subordinated in right of payment to any existing and future indebtedness or other liabilities, including trade payables, of the Company's subsidiaries (excluding the Guarantors) and the Guarantors' respective subsidiaries.
Restrictive Covenants
The Indenture contains covenants that, subject to certain qualifications and exceptions, limit the ability of the Company, the Guarantors and their subsidiaries to, among other things, (i) incur certain secured debt; (ii) enter into certain sale and lease-back transactions and (iii) consolidate, merge, sell or otherwise dispose of all or substantially all of their assets.
--------------------------------------------------------------------------------
Events of Default
Upon the occurrence of an event of default under the Indenture with respect to the New Notes, which includes payment defaults, defaults in the performance of certain covenants and bankruptcy and insolvency related defaults, the Company's obligations under the New Notes may be accelerated, in which case the entire principal amount of the New Notes would be immediately due and payable.
The foregoing description of the Indenture does not purport to be complete and is qualified in its entirety by reference to the full text of the Indenture. A copy of the Indenture is attached as Exhibit 4.1 to this Current Report on Form 8-K, and is incorporated by reference herein.
Registration Rights Agreement
On
If the exchange offer is not completed on or before
If the Company and the Guarantors fail to satisfy this obligation with respect
to a series of the New Notes (a "registration default") under the Registration
Rights Agreement, then additional interest will accrue on the principal amount
of the New Notes of such series at an annual rate of 0.250%. The annual interest
rate on such series of the New Notes will increase by an additional 0.250% for
each subsequent 90-day period during which the registration default continues,
up to a maximum of 1.000%. The additional interest will accrue to and including
the date such registration default ends, at which time the interest rate on the
applicable series of New Notes will revert to the original level. A registration
default ends with respect to any New Notes when such New Notes cease to be
If the Company is required to pay additional interest due to a registration default, the Company will pay such additional interest to the holders of the New Notes in cash on the same dates that the Company makes other interest payments . . .
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement
The information disclosed above under Item 1.01 is incorporated herein by reference.
Cautionary Note Regarding Forward-Looking Statements
This report contains forward-looking statements (including within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act) concerning the Company. These statements include, but are not limited to, statements that address our expected future business and financial
--------------------------------------------------------------------------------
performance and other statements identified by words such as "will", "expect", "believe", "anticipate", "estimate", "should", "intend", "plan", "potential", "predict", "project", "aim", and similar words, phrases or expressions. These forward-looking statements are based on current expectations and beliefs of the management of the Company, as well as assumptions made by, and information currently available to, such management, current market trends and market conditions and involve risks and uncertainties, many of which are outside the Company's and management's control, and which may cause actual results to differ materially from those contained in forward-looking statements. Accordingly, you should not place undue reliance on such statements.
Particular uncertainties that could materially affect future results include risks associated with: our acquisition of Symantec Corporation's Enterprise Security business ("Symantec Business"), including (1) potential difficulties in employee retention, (2) unexpected costs, charges or expenses, and (3) our ability to successfully integrate the Symantec Business and achieve the anticipated benefits of the transaction; any loss of our significant customers and fluctuations in the timing and volume of significant customer demand; our dependence on contract manufacturing and outsourced supply chain; our dependency on a limited number of suppliers; global economic conditions and concerns; international political and economic conditions; any acquisitions we may make, such as delays, challenges and expenses associated with receiving governmental and regulatory approvals and satisfying other closing conditions, and with integrating acquired businesses with our existing businesses and our ability to achieve the benefits, growth prospects and synergies expected by such acquisitions, including our recent acquisition of the Symantec Business; government regulations and trade restrictions; our significant indebtedness and the need to generate sufficient cash flows to service and repay such debt; dependence on and risks associated with distributors and resellers of our products; dependence on senior management and our ability to attract and retain qualified personnel; involvement in legal or administrative proceedings; quarterly and annual fluctuations in operating results; our ability to accurately estimate customers' demand and adjust our manufacturing and supply chain accordingly; cyclicality in the semiconductor industry or in our target markets; our competitive performance and ability to continue achieving design wins with our customers, as well as the timing of any design wins; prolonged disruptions of our or our contract manufacturers' manufacturing facilities, warehouses or other significant operations; our ability to improve our manufacturing efficiency and quality; our dependence on outsourced service providers for certain key business services and their ability to execute to our requirements; our ability to maintain or improve gross margin; our ability to protect our intellectual property and the unpredictability of any associated litigation expenses; compatibility of our software products with operating environments, platforms or third-party products; our ability to enter into satisfactory software license agreements; sales to our government clients; availability of third party software used in our products; use of open source code sources in our products; any expenses or reputational damage associated with resolving customer product warranty and indemnification claims; market acceptance of the end products into which our products are designed; our ability to sell to new types of customers and to keep pace with technological advances; our compliance with privacy and data security laws; our ability to protect against a breach of security systems; changes in accounting standards; fluctuations in foreign exchange rates; our provision for income taxes and overall cash tax costs, legislation that may impact our overall cash tax costs and our ability to maintain tax concessions in certain jurisdictions; and other events and trends on a national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature. Many of the foregoing risks and uncertainties are, and will be, exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result.
--------------------------------------------------------------------------------
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
4.1 Indenture, dated as of May 21, 2020 , by and among the Company, the
Guarantors and Wilmington Trust, National Association , as trustee.
4.2 Form of 3.459% Senior Notes due 2026 (included in Exhibit 4.1)
4.3 Form of 4.110% Senior Notes due 2028 (included in Exhibit 4.1)
4.4 Registration Rights Agreement, dated as of May 21, 2020 , by and
among the Company, the Guarantors and Barclays Capital Inc. and
Credit Suisse Securities (USA) LLC , as dealer-managers in connection
with the Exchange Offers.
104 Cover Page Interactive Data File (formatted as Inline XBRL).
--------------------------------------------------------------------------------
© Edgar Online, source
