ITEM 1.01 - ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On January 18, 2022, Ciena Corporation (the "Company") entered into an Indenture
among the Company, as issuer, certain domestic subsidiaries of the Company, as
guarantors (collectively, the "Guarantors"), and U.S. Bank National Association,
as trustee (the "Trustee"), pursuant to which it issued $400 million in
aggregate principal amount of 4.00% senior notes due 2030 (the "Notes").
The Company's obligations under the Notes and the Indenture are irrevocably and
unconditionally guaranteed, jointly and severally, on an unsecured senior basis
by each of the Company's domestic subsidiaries that is a borrower under or
guarantor with respect to the Company's existing term loan and senior secured
asset-based revolving credit facility (the "Credit Agreements").
The Notes and related guarantees have not been and will not be registered under
the Securities Act or the securities laws of any other jurisdiction and were
offered and sold in the United States to persons reasonably believed to be
qualified institutional buyers pursuant to Rule 144A under the Securities Act
and to non-U.S. persons in accordance with Regulation S under the Securities
The net proceeds from the sale of the Notes, after deducting discounts and
commissions, were approximately $395.5 million. The Company intends to use the
net proceeds from the Offering for general corporate purposes.
The Notes bear interest at a rate of 4.00% per annum and mature on January 31,
2030. Interest is payable on the Notes in arrears on January 31 and July 31 of
each year, commencing on July 31, 2022.
The Notes and related subsidiary guarantees are the general unsubordinated
unsecured senior obligations of the Company and the Guarantors, respectively,
and (i) rank equally in right of payment with all other existing and future
senior indebtedness of the Company and the Guarantors; (ii) are effectively
subordinated to all existing and future secured indebtedness of the Company and
the Guarantors, including indebtedness under the Credit Agreements, to the
extent of the value of the assets securing such indebtedness; (iii) are
structurally subordinated to all existing and future obligations, including
indebtedness, of the Company's subsidiaries that do not guarantee the Notes; and
(iv) are senior in right of payment to all of the Company's existing and future
unsecured indebtedness that is, by its terms, expressly subordinated in right of
payment to the Notes.
The Indenture contains restrictive covenants that limit the ability of the
Company and the Restricted Subsidiaries (as defined in the Indenture) or the
Guarantors, as applicable, to, among other things, create certain liens or
consolidate or merge with or into, or sell, lease, transfer, convey or otherwise
dispose of all or substantially all the assets of the Company or the Company and
its subsidiaries taken as a whole. These covenants are subject to a number of
important exceptions and qualifications as set forth in the Indenture.
The Indenture provides for events of default (subject in certain cases to
customary grace and cure periods) that include, among others, nonpayment of
principal or interest when due, breach of covenants or other agreements in the
Indenture, defaults in payment of certain other indebtedness and certain events
of bankruptcy or insolvency. Generally, if an event of default occurs, the
Trustee or the holders of at least 25% in principal amount of the outstanding
Notes may declare the principal of and accrued but unpaid interest on all of the
Notes to be due and payable immediately, provided that such amounts become due
and payable without any further action or notice in the case of an event of
bankruptcy or insolvency that constitutes an event of default.
Prior to January 31, 2025, the Company may redeem the Notes, in whole or part,
at a price equal to 100% of the principal amount thereof, plus a "make-whole"
premium and any accrued and unpaid interest. On or after January 31, 2025, the
Company may redeem the Notes, in whole or part, at the redemption prices set
forth in the Indenture and form of Notes, plus any accrued and unpaid interest.
In addition, until January 31, 2025, the Company may redeem up to 40% of the
aggregate principal amount of the Notes with the net cash proceeds of certain
equity offerings, as described in the Indenture, at a redemption price equal to
104% of the principal amount of the Notes to be redeemed, plus any accrued and
unpaid interest. If a change of control triggering event occurs, as described in
the Indenture, the Company must offer to repurchase all of the Notes (unless
otherwise redeemed) at a price equal to 101% of the principal amount thereof,
plus any accrued and unpaid interest.
The foregoing summary is qualified in its entirety by reference to the full text
of the Indenture, which is filed as Exhibit 4.1 to this Current Report on Form
8-K and incorporated herein by reference.
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 in Item 1.01 is incorporated by reference into this
ITEM 9.01 - FINANCIAL STATEMENTS AND EXHIBITS
(d) The following exhibits are being filed herewith:
Exhibit Number Description of Document
4.1 Indenture, dated as of January 18, 2022, by and among Ciena
Corporation, the subsidiary guarantors party thereto and U.S.
Bank National Association, as trustee
4.2 Form of 4.00% Senior Notes due 2030 (included in Exhibit
104 Cover Page Interactive Data File (embedded within the Inline
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