Company: SNPS
Filing Date: 2025-05-28
Form Type: 10-Q
Source: 0000883241-25-000017
Chunk: 26

Company: SYNOPSYS INC
Filing Date: 2025-05-28
Form: 10-Q
Item: Item 4
Chunk 26
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 risks relating to competition in the EDA industry and other industries, see “The growth of our business depends primarily on the semiconductor and electronics industries” and “We operate in highly competitive industries, and if we do not continue to meet our customers’ demand for innovative technology at lower costs, our products may not be competitive or may become obsolete.”

Our ability to manage our business and growth will require us to continue to improve our operational, financial and management controls, reporting systems and procedures. We may also encounter risks, costs and expenses associated with any undisclosed or other unanticipated liabilities and use more cash and other financial resources on integration and implementation activities than we expect. We may not be able to integrate the Ansys business into our existing operations on our anticipated timelines or realize the full expected economic benefits of the Ansys Merger, which may have a material adverse effect on our business, operating results and financial condition.

In addition, the completion of the Ansys Merger may heighten the potential adverse effects on our business, operating results or financial condition described elsewhere in the Risk Factors in this Quarterly Report.

Our significant debt may limit our financial flexibility following the Ansys Merger.

We have incurred and we expect that we will continue to incur a substantial amount of debt in connection with the Ansys Merger. As of April 30, 2025, we have entered into the Bridge Commitment Letter and the Term Loan Agreement and issued the Senior Notes for the purpose of financing a portion of the cash consideration to be paid in the Ansys Merger and paying related fees and expenses in connection with the Ansys Merger and the other transactions contemplated by the Merger Agreement. We also expect to use a portion of these proceeds to repay Ansys’ existing credit facility substantially concurrently with the completion of the Ansys Merger.

Following the Ansys Merger, the substantial indebtedness incurred in connection with the Ansys Merger could have adverse effects on our business, operating results and financial condition, including, among other things:

•increasing our vulnerability to changing economic, regulatory and industry conditions;

•limiting our ability to compete and our flexibility in planning for, or reacting to, changes in our business and the industry;

•placing us at a competitive disadvantage compared to our competitors with less indebtedness;

•increasing our interest expense and potentially requiring us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing the availability of cash to fund our business needs;

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•limiting our ability to return equity through our stock