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NVIDIA CORP 8-K Report, Agreement Terminated (Feb 8, 2022)

Reports
Material Agreements
Filing Date
Filed February 8, 2022
Period End
February 8, 2022
Security
NVDA
In the record · 2016–202610-K1110-Q328-K110

NVDA filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 110 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Feb ’17Feb ’17
  2. Leadership change8-K · Apr ’19Apr ’19
  3. Leadership change8-K · Mar ’21Mar ’21
  4. Material agreement8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed February 8, 2022. Cited figures are marked; the original filing is the authoritative source.

NVIDIA Corporation (NVDA) announced on February 8, 2022, the mutual termination of its Share Purchase Agreement with SoftBank Group Capital Limited and SVF Holdco (UK) Limited concerning the acquisition of Arm Limited.

The termination was driven by significant regulatory challenges that prevented the deal's consummation. As a result of the termination, NVIDIA will not acquire Arm. The $1.25 billiona prepayment made by NVIDIA will be retained by SoftBank.

However, NVIDIA will maintain its existing 20-year Arm license. The company expects to record a charge of $1.36 billionb in the first quarter of fiscal year 2023, which includes the initial prepayment, due to this termination.

02—Key points

Key Highlights

  1. Termination of the Arm acquisition agreement between NVIDIA and SoftBank was mutually agreed upon.
  2. The primary reason for termination cited is significant regulatory challenges.
  3. NVIDIA will not acquire Arm.
  4. NVIDIA's $1.25 billion prepayment will be retained by SoftBank.
  5. NVIDIA retains its existing 20-year Arm license.
  6. NVIDIA will record a $1.36 billion charge in Q1 FY2023 related to the termination, including the prepayment.
  7. The transaction was originally announced on September 14, 2020.

03—Questions

Frequently Asked Questions

  1. Why did NVIDIA terminate the Arm acquisition?

    NVIDIA mutually terminated the Arm acquisition agreement due to significant regulatory challenges that prevented the consummation of the transaction.

  2. What happens to the $1.25 billion NVIDIA paid upfront?

    NVIDIA's $1.25 billion prepayment made at the signing of the agreement will be retained by SoftBank Group Capital Limited and SVF Holdco (UK) Limited.

  3. Will NVIDIA still have access to Arm's technology?

    Yes, NVIDIA will retain its existing 20-year Arm license, allowing continued access to Arm's technology.

  4. What is the financial impact of this termination on NVIDIA?

    NVIDIA expects to record a charge of $1.36 billion in the first quarter of fiscal year 2023. This charge includes the $1.25 billion prepayment and other associated costs related to the termination.

04—Continue

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