[8-K] Applied Optoelectronics, Inc. Reports Material Event

Rhea-AI Filing Summary

Applied Optoelectronics (AAOI) has strengthened its liquidity profile. On 31 Jul 2025 the company executed a three-year, $35 million secured revolving Credit Facility with BOKF, NA dba BOK Financial. The agreement includes an accordion that can expand total commitments to $75 million, subject to lender approval, and will be used for general working-capital and operating needs.

Borrowings are secured by substantially all domestic assets (foreign-subsidiary assets excluded) and accrue interest at Term SOFR + 0.10% plus an Applicable Margin. Interest is payable monthly and the outstanding principal is due at maturity. The facility contains customary representations, financial covenants and default provisions typical for similar credit arrangements.

Items 1.01 and 2.03 of the Form 8-K disclose the entry into, and creation of, this direct financial obligation. The Loan and Security Agreement and Revolving Note are filed as Exhibits 10.1 and 10.2, respectively. No earnings figures were provided in the filing.

Positive

• $35 million revolving credit line improves immediate liquidity and working-capital flexibility.
• Accordion feature up to $75 million offers additional borrowing capacity without new negotiations.
• Competitive pricing at Term SOFR + 0.10% plus margin indicates favorable borrowing terms.

Negative

• Facility is secured by nearly all domestic assets, increasing collateral encumbrance.
• New financial covenants and default provisions may restrict operational flexibility.
• Exposure to floating SOFR rates could raise interest expense if rates climb.

Insights

Financial Analyst

TL;DR: New $35 m revolver adds flexibility; modestly positive.

The credit line immediately boosts short-term liquidity and offers headroom up to $75 m via the accordion. Pricing at SOFR + 0.10% (before margin) is competitive, suggesting the lender’s confidence in AAOI’s credit quality. While covenants may restrict leverage, the facility provides working-capital support without equity dilution. Because the borrowing base excludes foreign assets, offshore expansion remains ring-fenced. Overall impact is mildly accretive to financial flexibility but not transformational.

Credit Risk Analyst

TL;DR: Secured debt introduces lien; covenant risk moderate.

The revolver is secured by nearly all U.S. assets, which subordinates future unsecured creditors and could raise recovery risk. Financial covenants (not disclosed in detail) may tighten headroom if operating volatility persists. Variable-rate exposure links interest cost to SOFR movements. Nonetheless, the three-year tenor and accordion option provide manageable near-term liquidity. Net credit impact is balanced: liquidity positive offset by incremental secured leverage.

8-K Event Classification

3 items: 1.01, 2.03, 9.01

3 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Financial

The company incurred a new significant debt or off-balance-sheet obligation.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Understanding 8-K Material Events →

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 31, 2025

Applied Optoelectronics, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-36083	76-0533927
(State of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

13139 Jess Pirtle Blvd.
Sugar Land, Texas 77478

(Address of principal executive offices and zip code)

(281) 295-1800

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Trading Name of each exchange on which registered
Common Stock, Par value $0.001	AAOI	NASDAQ Global Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 1.01 Entry into a Material Definitive Agreement.

On July 31, 2025, Applied Optoelectronics, Inc. (the “Company”) entered into a Loan and Security Agreement (the “Credit Facility”) with BOKF, NA dba BOK Financial, as agent for secured parties. The Credit Facility provides the Company with a three-year, $35 million revolving line of credit. The Credit Facility includes an accordion feature that allows the Company to request additional lender commitments in an aggregate amount not to exceed $40 million (for a total aggregate amount of $75 million) pursuant to certain conditions. Borrowings under the Credit Facility will be used for general working capital purposes and business operations.

The Company's obligations under the Credit Facility will be secured by substantially all of the Company's assets excluding assets of the Company’s foreign subsidiaries. As defined in the Loan and Security Agreement, borrowings under the Revolving Advances will bear interest at a rate equal to Term Secured Overnight Financing Rate (SOFR) plus 0.10% and the Applicable Margin, and on all other Obligations at the same rate unless otherwise agreed. The Company will make monthly payments of accrued interest, and the principal shall be repaid upon maturity.

The Credit Facility requires the Company to maintain certain financial covenants and contains representations and warranties, and events of default applicable to the Company that are customary for agreements of this type.

The foregoing description of the Credit Facility does not purport to be a complete statement of the parties’ rights and obligations under the Credit Facility and is qualified in its entirety by reference to the full text of the Loan and Security Agreement and Revolving Note, dated July 31, 2025, copies of which are attached as Exhibit 10.1 and 10.2 to this Current Report on Form 8-K and incorporated by reference herein.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information contained in Item 1.01 of this Current Report on Form 8-K with respect to the Credit Facility is incorporated by reference herein and made a part hereof.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

10.1	Loan and Security Agreement, dated July 31, 2025, between Applied Optoelectronics, Inc. and BOKF, NA dba BOK Financial.
10.2	Revolving Note, dated July 31, 2025, between Applied Optoelectronics, Inc. and BOKF, NA dba BOK Financial.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 6, 2025	APPLIED OPTOELECTRONICS, INC.
	By:	/s/ David C. Kuo
	Name:	David C. Kuo
	Title:	Senior Vice President and Chief Legal Officer

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FAQ

What is the size of Applied Optoelectronics’ new credit facility?

The company obtained a $35 million revolving line of credit with the option to expand to $75 million via an accordion feature.

Who is the lender for AAOI’s new revolver?

The facility is provided by BOKF, NA dba BOK Financial, acting as agent for secured parties.

What assets secure the credit facility?

Borrowings are secured by substantially all of AAOI’s domestic assets, excluding assets of its foreign subsidiaries.

What interest rate applies to the borrowings?

Loans accrue interest at Term SOFR plus 0.10% and an Applicable Margin, with interest payable monthly.

How long does the credit facility last?

The revolver has a three-year term; principal is due upon maturity.

Where can I find the full agreement details?

The Loan and Security Agreement (Ex. 10.1) and Revolving Note (Ex. 10.2) are attached to the Form 8-K.