Item 1.01 Entry into a Material Definitive Agreement. On December 31, 2013 , Applied Optoelectronics, Inc. (the "Company") entered into a Credit Facility Agreement (the "Credit Facility") with E. Sun Commercial Bank Co., Ltd in Taipei, Taiwan (the "Bank") for a $4 million , one year revolving credit facility. Borrowings under the Credit Facility will be used for general corporate purposes. The Company's obligations under the Credit Facility are secured by the Company's $4 million cash deposit in a one-year CD with the Bank. Borrowings under the Credit Facility will bear interest at a rate (which adjusts quarterly) equal to either the Taiwan Time Deposit Interest Rate Index (the interest rate applicable to one-year time deposits adopted by various reference banks) plus 0.41% in the case of New Taiwan Dollar borrowings or LIBOR plus 1.28% in the case of US Dollar borrowings. The Credit Facility contains representations and warranties, affirmative, restrictive and financial covenants, and events of default (applicable to the Company) which are customary for credit facilities of this type. 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 Amendment is incorporated by reference herein and made a part hereof.
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