Ciena Corporation Secures $1.16 Billion Refinancing Amendment

Ciena Corporation (NYSE: CIEN) recently announced the completion of a significant financial agreement. According to a current report on Form 8-K filed with the Securities and Exchange Commission on January 17, 2025, Ciena Corporation entered into a Refinancing Amendment to Credit Agreement. This amendment, effective as of the same date, involved a refinancing transaction that saw Ciena incurring a new single tranche of senior secured term loans totaling approximately $1.16 billion.

The purpose of this refinancing was to address an outstanding senior secured term loan, which amounted to the same figure, and was set to mature on October 24, 2030. The new loan, termed the 2025 Term Loan, was funded through a combination of the loan proceeds and existing cash reserves. This strategic move allowed Ciena to completely pay off the Existing Term Loan, covering both principal and accrued interest, in addition to clearing associated transaction fees and expenses.

Key elements of the Refinancing Amendment to Credit Agreement include provisions that specify the following:
– The 2025 Term Loan will mature on October 24, 2030.
– Amortization will be executed in equal quarterly installments equivalent to about 0.25% of the principal amount of the 2025 Term Loan at the Closing Date, with any remaining balance due at maturity.
– Mandatory prepayment is required based on specific events akin to those set for the Existing Term Loan, such as asset sales, debt issuances, and annual Excess Cash Flow receipts as defined in the Credit Agreement.
– Interest rates are at the discretion of Ciena, with the option to choose either SOFR plus an applicable margin of 1.75% or a base rate plus an applicable margin of 0.75%.
– Repayment is allowed at any time, but a prepayment premium of 1% of the aggregate principal amount is applicable if utilizing proceeds from certain debts for repayment before July 17, 2025.

Apart from these outlined changes, all other terms and conditions from the original Credit Agreement remain unchanged. The detailed specifics of the Refinancing Amendment can be found in Exhibit 10.1 included in the aforementioned Form 8-K filing.

This recent financial move by Ciena Corporation signifies a strategic step in managing its debt arrangements effectively and ensuring financial stability moving forward.

Please note that the abovementioned details are based on the information provided in Ciena Corporation’s Form 8-K filing with the Securities and Exchange Commission.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Ciena’s 8K filing here.

Ciena Company Profile

Ciena Corporation provides hardware and software services for delivery of video, data, and voice traffic metro, aggregation, and access communications network worldwide. The company’s Networking Platforms segment offers convergence of coherent optical transport, open optical networking, optical transport network switching, IP routing, and switching services.