Item 1.01. Entry into a Material Definitive Agreement.
Credit Agreement
On
Amounts outstanding under the Credit Agreement initially accrue interest at a rate equal to, at Cadence's option, either (1) LIBOR plus a margin of between 0.750% and 1.250%, determined by reference to the rating of Cadence's unsecured debt , or (2) base rate plus a margin of 0.000% to 0.250%, determined by reference to the rating of Cadence's unsecured debt. Additionally, Cadence will pay commitment fees on the undrawn amount of the revolving commitments at a rate between 0.07% and 0.175%, determined by reference to the rating of Cadence's unsecured debt.
The covenants of the Credit Agreement include customary negative covenants that,
among other things, restrict Cadence's ability to incur additional secured
indebtedness and grant liens. In addition, the Credit Agreement contains a
financial covenant that requires Cadence to maintain a funded debt to EBITDA
ratio not greater than 3.25 to 1, with a step-up to 3.75 to 1 for one year
following an acquisition by Cadence of at least
A copy of the Credit Agreement is attached hereto as Exhibit 10.01 and is incorporated herein by reference. The foregoing description is qualified in its entirety by reference to the Credit Agreement.
Item 1.02. Termination of a Material Definitive Agreement
The information set forth under Item 1.01 of this Current Report on Form 8-K regarding the termination of the Prior Credit Agreement is hereby incorporated by reference into this Item 1.02.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference into this Item 2.03.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits Exhibit No. Description 10.01 Credit Agreement, dated as ofJune 30, 2021 , by and amongCadence Design Systems, Inc. ,Bank of America, N.A . and other lenders party thereto. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). 2
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