Item 1.01 Entry into Definitive Material Agreement.
On the Effective Date, the Company entered into a Credit Agreement with the lenders and L/C Issuers named therein, Bank of America, N.A., as
administrative agent (in such capacity, the Administrative Agent), and the other parties from time to time party thereto (the Credit Agreement). The Credit Agreement provides for a $5.0 billion unsecured revolving credit
facility (the Revolving Facility), a $9.0 billion unsecured term
A-3
facility (the Term
A-3
Facility) and a $9.0 billion unsecured term
A-5
facility (the Term
A-5
Facility). The Companys obligations under the Credit Agreement are guaranteed on an unsecured basis by Broadcom Corporation,
a California corporation, Broadcom Cayman Finance Limited, an exempted company incorporated with limited liability under the laws of the Cayman Islands and Broadcom Pte. Ltd. (formerly Broadcom Limited), a private company limited by shares
incorporated under the laws of Singapore.
The term loans under the Term
A-3
Facility and Term
A-5
Facility were made in a single borrowing on the Effective Date and will mature and be payable in full on the third or fifth anniversary, respectively, of the Effective Date. The Revolving Facility is a five-year
unsecured revolving facility. Initially, the aggregate commitment of all revolving lenders under the Credit Agreement is equal to $5.0 billion, of which $500 million is available for the issuance of multicurrency letters of credit. The
issuance of letters of credit reduces the aggregate amount otherwise available under the Revolving Facility for the making of revolving loans. Subject to the terms of the Credit Agreement, the Company may borrow, repay and reborrow revolving loans
at any time prior to the earlier of (a) the fifth anniversary of the Effective Date, and (b) the date of termination in whole of the revolving lenders commitments under the Credit Agreement in accordance with the terms thereof. The
Company had no borrowings outstanding under the Revolving Facility on the Effective Date.
Borrowings under the Revolving Facility, Term
A-3
Facility and Term
A-5
Facility will bear interest at a fluctuating rate per annum equal to, at the Companys option, the alternate base rate or the reserve adjusted
Eurocurrency rate, in each case, plus an applicable margin that varies by facility and is calculated based on the Companys credit ratings from time to time. In addition, the Company will also pay to the revolving lenders under the Credit
Agreement certain customary fees, including a commitment fee on the daily actual excess of each lenders revolving commitment over its outstanding revolving credit exposure under the Credit Agreement, calculated based on the Companys
credit ratings from time to time.
Voluntary prepayments of the loans and voluntary reductions of the unutilized portion of the revolving
commitments under the Credit Agreement are permissible without penalty (other than customary Eurocurrency loan breakage), subject to certain conditions pertaining to minimum notice and minimum reduction amounts as described in the Credit Agreement.
The Credit Agreement contains representations and warranties and affirmative and negative covenants customary for unsecured financings of
this type, as well as a financial covenant requiring that,