|3 Months Ended|
Mar. 26, 2022
|Subsequent Events [Abstract]|
|Pending Acquisition||Subsequent Events
On April 3, 2022, the Company entered into a definitive agreement to acquire Pensando Systems, Inc., for $1.9 billion (Pensando Merger), subject to certain working capital adjustments. The acquisition of Pensando will add a leading distributed services platform to the Company’s high-performance CPU, GPU, FPGA and adaptive SoC portfolio, and expand the Company’s ability to offer leadership solutions for cloud, enterprise and edge customers. The closing of the Pensando Merger is subject to customary closing conditions, including regulatory approval. The transaction is currently expected to close in the second quarter of 2022.
On April 29, 2022, the Company entered into a revolving credit agreement (Revolving Credit Agreement) with Wells Fargo Bank, N.A. as administrative agent and other banks identified therein as lenders. The Revolving Credit Agreement provides for a five-year unsecured revolving credit facility in aggregate principal amount of $3.0 billion. Borrowings under the Revolving Credit Agreement will bear interest at a fluctuating rate per annum equal to, at the Company’s option, the alternate base rate or the adjusted Term Secured Overnight Financing Rate (SOFR) (as defined in the Revolving Credit Agreement), in each case, plus an applicable margin that is calculated based on the Company’s credit ratings from time to time and ranges from 0.00% to 0.25% in the case of loans accruing at the alternate base rate, and 0.625% to 1.250% in the case of loans accruing at the adjusted Term. In addition, the Company has agreed to pay to the lenders under the Revolving Credit Agreement certain customary fees, including a commitment fee on the average daily unused portion of the Revolving Credit Commitments (as defined in the Revolving Credit Agreement) which ranges between 0.05% and 0.125% based on the Company’s credit ratings from time to time. The Revolving Credit Agreement contains a sustainability-linked pricing component which provides for interest rate margin and commitment fee reductions or increases by meeting or missing targets related to environmental sustainability, specifically, greenhouse gas emissions. Also, on April 29, 2022, in connection with the entry into the Revolving Credit Agreement, the Company terminated its existing $500 million credit agreement dated as of June 7, 2019, among the Company, the lenders party thereto and Wells Fargo Bank, National Association (the Revolving Credit Facility). There were no amounts drawn upon the Revolving Credit Facility prior to termination.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef