Business Context and Reporting Period
This Form 8-K Current Report was filed by Applied Optoelectronics, Inc. on December 11, 2018. The report details a material definitive agreement entered into by Prime World International Holdings Ltd., a wholly owned subsidiary of the registrant.
Key Financial Metrics
The filing discloses the establishment of a new credit facility rather than reporting period-end financial performance metrics such as revenue, profit, or cash flow.
- Credit Facility Amount: NT$150 million.
- Purpose: Short-term working capital.
- Term: One-year facility available from December 11, 2018, to October 31, 2019.
- Draw Term: Up to 120 days per draw.
- Interest Rate (NTD): Bank's Enterprise Swap Index Rate plus 1.2% (Index rate at execution: 0.69%).
- Interest Rate (Foreign Currency): Bank's Cost of Fund lending rate plus 1.2% (Rate at execution: 3.40%).
Material Changes
The primary material change is the creation of a direct financial obligation through the new credit facility with CTBC Bank Co., Ltd. The filing does not provide comparative financial data against prior periods as it is a current report regarding a specific event.
Outlook, Risks, and Contingencies
The agreement includes customary representations, warranties, and events of default. The filing notes that the description provided is not a complete statement of rights and obligations and refers to attached exhibits for full terms. No specific forward-looking guidance or management commentary regarding future earnings or operational outlook is included in this document.
Investor Verification Checklist
- Verify the utilization of the NT$150 million facility against the company's actual working capital needs.
- Review the full text of Exhibits 10.1 through 10.4 for specific covenants and default conditions.
- Monitor the impact of the variable interest rates (Enterprise Swap Index and Cost of Fund) on future interest expense.
- Confirm the repayment schedule for principal and accrued interest at the end of each 120-day draw term.