LOAN AND SECURITY AGREEMENT

Exhibit 10.51

[EXECUTION COPY]

 

MULTI-FINELINE ELECTRONIX, INC.

AND

MULTI-FINELINE ELECTRONIX SINGAPORE PTE. LTD.,

as Borrowers

 

LOAN AND SECURITY AGREEMENT

Dated as of February 12 , 2009

 

CERTAIN FINANCIAL INSTITUTIONS,

as Lenders

and

BANK OF AMERICA, N.A.,

as Agent

 

TABLE OF CONTENTS

 

 

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TABLE OF CONTENTS

(continued)

 

 

-ii-

TABLE OF CONTENTS

(continued)

 

 

-iii-

TABLE OF CONTENTS

(continued)

 

 

-iv-

LIST OF EXHIBITS AND SCHEDULES

 

 

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LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT is dated as of February 12, 2009, among MULTI-FINELINE ELECTRONIX, INC., a Delaware corporation (“ U.S. Borrower ”), MULTI-FINELINE ELECTRONIX SINGAPORE PTE. LTD., a Singapore company (“ Singapore Borrower , and together with U.S. Borrower, collectively, “ Borrowers ”), the financial institutions party to this Agreement from time to time as lenders (collectively, “ Lenders ”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“ Agent ”).

R E C I T A L S :

Borrowers have requested that Lenders provide a credit facility to Borrowers to finance their mutual and collective business enterprise.

Lenders are willing to provide such credit facility on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties agree as follows:

SECTION 1. DEFINITIONS; RULES OF CONSTRUCTION

1.1. Definitions . As used herein, the following terms have the meanings set forth below:

AAA : as defined in Section  14.14 .

Account : as defined in the UCC, including all rights to payment for goods sold or leased, or for services rendered.

Account Debtor : a Person who is obligated under an Account, Chattel Paper or General Intangible.

Accounts Formula Amount : at any time, as to each Borrower, an amount equal to 85% of the Value of Eligible Accounts of such Borrower; provided , however , that such percentage shall be reduced by 1.0% for each whole percentage point (or portion thereof) that the Dilution Percent exceeds 5%.

Adjusted Cash Liquidity : as of any date (calculated as of the last day of preceding calendar month), the sum of (a) (i) cash and Cash Equivalents of Borrowers on deposit in Deposit Accounts subject to a Deposit Account Control Agreement in favor of Agent plus (ii) cash and Cash Equivalents of any Subsidiary of any Borrower plus (iii) the aggregate amount of Capital Expenditures that have been identified in the Capital Expenditures Budget and paid during the current Fiscal Year, minus the sum of (b) (i) the aggregate principal amount of all Revolver Loans and LC Obligations, plus (ii) the aggregate principal amount of trade payables

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

that are more than 70 days past the applicable invoice date, plus (iii) the aggregate amount of Capital Expenditures that have been identified in the Capital Expenditures Budget during the current Fiscal Year.

Adjusted Fixed Charge Coverage Ratio : as of any date the ratio, determined on a consolidated basis for U.S. Borrower and its Subsidiaries for the 12 full Fiscal Month period immediately preceding such date for which financial statements have been delivered or were required to be delivered pursuant to Section 10.1.2 , of (a) EBITDA to (b) Fixed Charges plus the aggregate amount of repurchases of Equity Interests of U.S. Borrower pursuant to Section 10.2.3(a)(iii) .

Affiliate : with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. “ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have correlative meanings.

Agent Indemnitees : Agent and its officers, directors, employees, Affiliates, agents and attorneys.

Agent Professionals : attorneys, accountants, appraisers, auditors, business valuation experts, environmental engineers or consultants, turnaround consultants, and other professionals and experts retained by Agent.

Aggregate Availability : the Aggregate Borrowing Base minus the aggregate outstanding principal amount of all Revolver Loans and LC Obligations.

Aggregate Borrowing Base : as of any date the sum of the Singapore Borrowing Base and the U.S. Borrowing Base.

Anti-Terrorism Laws : any laws relating to terrorism or money laundering, including the Patriot Act.

Applicable Law : all laws, rules, regulations and governmental guidelines applicable to the Person, conduct, transaction, agreement or matter in question, including all applicable statutory law, common law and equitable principles, and all applicable provisions of constitutions, treaties, statutes, rules, regulations, orders and decrees of Governmental Authorities.

Applicable Margin : with respect to any Type of Revolver Loan, the margin set forth below, as determined by the Adjusted Fixed Charge Coverage Ratio as of the last day of each Fiscal Quarter:

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Notwithstanding the foregoing, until such time as MFC3 Plant costs are no longer excluded from the calculation of “Fixed Charges” as provided in the definition of “Capital Expenditures” margins shall be determined as if Level III were applicable. Thereafter, the margins shall be subject to increase or decrease upon receipt by Agent pursuant to Section 10.1.2 of the financial statements and corresponding Compliance Certificate for the last Fiscal Quarter, which change shall be effective on the first day of the calendar month following receipt. If, by the first day of a month, any financial statements and Compliance Certificate due in the preceding month have not been received, then, at the option of Agent or Required Lenders, the margins shall be determined as if Level III were applicable, from such day until the first day of the calendar month following actual receipt.

Approved Fund : any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in its ordinary course of activities, and is administered or managed by a Lender, an entity that administers or manages a Lender, or an Affiliate of either.

Asset Disposition : a sale, lease, license, consignment, transfer or other disposition of Property of an Obligor, including a disposition of Property in connection with a sale-leaseback transaction or synthetic lease.

Assignment and Acceptance : an assignment agreement between a Lender and Eligible Assignee, in the form of Exhibit B .

Aurora Optical : Aurora Optical, Inc., a Delaware corporation.

Availability Block : $6,000,000 and, if the Revolver Commitments are increased pursuant to Section 2.1.7 to an amount greater than $40,000,000, $10,000,000. The Availability Block may be apportioned between the Singapore Revolver Loans and the U.S. Revolver Loans in the discretion of Agent.

Availability Reserve : the sum (without duplication) of (a) the LC Reserve; (b) the Bank Product Reserve; (c) the aggregate amount of liabilities secured by Liens upon Collateral that are senior to Agent’s Liens (but imposition of any such reserve shall not waive an Event of Default arising therefrom); (d) the Pelikon Note Reserve; (e) the Pelikon Contingent Note Reserve; (f)

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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the Rent and Charges Reserve; and (g) such additional reserves, in such amounts and with respect to such matters, as Agent in its discretion may elect to impose from time to time.

Bank of America : Bank of America, N.A., a national banking association, and its successors and assigns.

Bank of America Indemnitees : Bank of America and its officers, directors, employees, Affiliates, agents and attorneys.

Bank of America-Singapore Branch : Bank of America, N.A. acting through its Singapore branch.

Bank Product : any of the following products, services or facilities extended to any Borrower or Subsidiary by Bank of America or any of its Affiliates: (a) Cash Management Services; (b) products under Hedging Agreements; (c) commercial credit card and merchant card services; and (d) leases and other banking products or services as may be requested by any Borrower or Subsidiary, other than Letters of Credit.

Bank Product Debt : Debt and other obligations of an Obligor relating to Bank Products.

Bank Product Reserve : the aggregate amount of reserves established by Agent from time to time in its discretion in respect of Bank Product Debt.

Bankruptcy Code : Title 11 of the United States Code.

Base Rate : for any day, a per annum rate equal to the greatest of (a) the Prime Rate for such day; (b) the Federal Funds Rate for such day, plus 0.50%; or (c) LIBOR for a 30 day interest period as determined on such day, plus 1.0%.

Base Rate Revolver Loan : collectively and individually, the U.S. Base Rate Revolver Loans and Singapore Base Rate Revolver Loans.

Board of Governors : the Board of Governors of the Federal Reserve System.

Borrowed Money : with respect to any Obligor, without duplication, its (a) Debt that (i) arises from the lending of money by any Person to such Obligor, (ii) is evidenced by notes, drafts, bonds, debentures, credit documents or similar instruments, (iii) accrues interest or is a type upon which interest charges are customarily paid (excluding trade payables owing in the Ordinary Course of Business), or (iv) was issued or assumed as full or partial payment for Property; (b) Capital Leases; (c) reimbursement obligations with respect to letters of credit; and (d) guaranties of any Debt of the foregoing types owing by another Person. Without limiting the foregoing, the Pelikon Notes and the Pelikon Contingent Note constitute Borrowed Money.

Borrower Agent : as defined in Section 4.4 .

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Borrowing : a group of Revolver Loans of one Type that are made on the same day or are converted into Revolver Loans of one Type on the same day.

Borrowing Base : the U.S. Borrowing Base, in the case of U.S. Borrower, or the Singapore Borrowing Base, in the case of Singapore Borrower; as the context may require, refers also to the U.S. Borrowing Base and the Singapore Borrowing Base, collectively.

Borrowing Base Certificate : a certificate, in form and substance satisfactory to Agent, by which Borrower Agent certifies its calculation of the Borrowing Base of each Borrower.

Business Day : (a) any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or are in fact closed in, North Carolina and California; (b) if such day relates to a LIBOR Revolver Loan, any such day on which dealings in Dollar deposits are conducted between banks in the London interbank Eurodollar market; and (c) if such day relates to any borrowing, payment or rate selection by Singapore Borrower, (i) any such day on which dealings in Dollar deposits are conducted between banks in the Singapore interbank SIBOR market and (ii) commercial banks are not authorized to close under the laws of, or are in fact closed in, Singapore.

Capital Expenditures : all liabilities incurred, expenditures made or payments due (whether or not made) by a Borrower or Subsidiary for the acquisition of any fixed assets, or any improvements, replacements, substitutions or additions thereto with a useful life of more than one year, including the principal portion of Capital Leases; provided that, for the period on or prior to December 31, 2009, the costs of constructing and equipping the MFC3 Plant in an amount not to exceed [CONFIDENTIAL TREATMENT REQUESTED] shall not constitute Capital Expenditures for purposes of the definition of “Fixed Charges”.

Capital Expenditures Budget : the annual budget of U.S. Borrower and its Subsidiaries of Capital Expenditures as approved by Agent.

Capital Lease : any lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.

Cash Collateral : cash, and any interest or other income earned thereon, that is delivered to Agent to Cash Collateralize any Obligations.

Cash Collateral Account : a demand deposit, money market or other account established by Agent at such financial institution as Agent may select in its discretion, which account shall be subject to Agent’s Liens for the benefit of Secured Parties.

Cash Collateralize : the delivery of cash to Agent, as security for the payment of Obligations, in an amount equal to (a) with respect to LC Obligations, 105% of the aggregate LC Obligations, and (b) with respect to any inchoate, contingent or other Obligations (including Obligations arising under Bank Products), Agent’s good faith estimate of the amount due or to

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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become due, including all fees and other amounts relating to such Obligations. “ Cash Collateralization ” has a correlative meaning.

Cash Equivalents : (a) marketable obligations issued or unconditionally guaranteed by, and backed by the full faith and credit of, the United States government, maturing within 12 months of the date of acquisition; (b) certificates of deposit, time deposits and bankers’ acceptances maturing within 12 months of the date of acquisition, and overnight bank deposits, in each case which are issued by a commercial bank organized under the laws of the United States or any state or district thereof, rated A-1 (or better) by S&P or P-1 (or better) by Moody’s at the time of acquisition, and (unless issued by a Lender) not subject to offset rights; (c) repurchase obligations with a term of not more than 30 days for underlying investments of the types described in clauses (a) and (b) entered into with any bank meeting the qualifications specified in clause (b); (d) commercial paper rated A-1 (or better) by S&P or P-1 (or better) by Moody’s, and maturing within nine months of the date of acquisition; and (e) shares of any money market fund that has substantially all of its assets invested continuously in the types of investments referred to above, has net assets of at least $500,000,000 and has the highest rating obtainable from either Moody’s or S&P.

Cash Management Services : any services provided from time to time by Bank of America or any of its Affiliates to any Borrower or Subsidiary in connection with operating, collections, payroll, trust, or other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic funds transfer, wire transfer, controlled disbursement, overdraft, depository, information reporting, lockbox and stop payment services.

Cayman Share Charge : the Share Charge of U.S. Borrower in respect of its Equity Interests in MFlex Cayman, in form and substance satisfactory to Agent, executed and delivered by U.S. Borrower on the Closing Date.

CERCLA : the Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. § 9601 et seq .).

CFC Foreign Subsidiary : as defined in Section 7.1.3 .

Change in Law : the occurrence, after the date hereof, of (a) the adoption or taking effect of any law, rule, regulation or treaty; (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority; or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

Change of Control : (a) any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934) other than WBL Corporation becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 35%, or more, of the Equity Interests of U.S. Borrower having the right to vote for the election of members of the board of directors of U.S. Borrower; (b) U.S. Borrower

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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ceases to beneficially own and control all Equity Interests in Singapore Borrower; or (c) all or substantially all of a Borrower’s assets are sold or transferred, other than sale or transfer to another Borrower.

Chattel Paper : as defined in the UCC.

Claims : all liabilities, obligations, losses, damages, penalties, judgments, proceedings, interest, costs and expenses of any kind (including remedial response costs, reasonable attorneys’ fees and Extraordinary Expenses) at any time (including after Full Payment of the Obligations, resignation or replacement of Agent, or replacement of any Lender) incurred by or asserted against any Indemnitee in any way relating to (a) any Revolver Loans, Letters of Credit, Loan Documents, or the use thereof or transactions relating thereto, (b) any action taken or omitted to be taken by any Indemnitee in connection with any Loan Documents, (c) the existence or perfection of any Liens, or realization upon any Collateral, (d) exercise of any rights or remedies under any Loan Documents or Applicable Law, or (e) failure by any Obligor to perform or observe any terms of any Loan Document, in each case including all costs and expenses relating to any investigation, litigation, arbitration or other proceeding (including an Insolvency Proceeding or appellate proceedings), whether or not the applicable Indemnitee is a party thereto; provided , however , that except with respect to the general indemnity of each Borrower in favor of Lenders hereunder, the fees and out-of-pocket expenses of Lenders shall only constitute Claims to the extent set forth in the last sentence of Section 14.2 .

Closing Date : as defined in Section 6.1 .

Code : the Internal Revenue Code of 1986, as amended from time to time.

Collateral : all Property described in Section 7.1 , all Property described in any Security Documents as security for any Obligations, and all other Property that now or hereafter secures (or is intended to secure) any Obligations.

Commercial Tort Claim : as defined in the UCC.

Commitment Termination Date : the earliest to occur of (a) the Revolver Termination Date; (b) the date on which Borrowers terminate the Revolver Commitments pursuant to Section 2.1.4 ; or (c) the date on which the Revolver Commitments are terminated pursuant to Section 11.2 .

Compliance Certificate : a certificate, in the form of Exhibit D , in form and substance satisfactory to Agent, by which Borrower Agent certifies (a) compliance with Sections 10.2.3 and 10.3 and (b) the calculation of Adjusted Fixed Charge Coverage Ratio and Adjusted Cash Liquidity.

Contingent Obligation : any obligation of a Person arising from a guaranty, indemnity or other assurance of payment or performance of any Debt, lease, dividend or other obligation

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(“ primary obligations ”) of another obligor (“ primary obligor ”) in any manner, whether directly or indirectly, including any obligation of such Person under any (a) guaranty, endorsement, co-making or sale with recourse of an obligation of a primary obligor; (b) obligation to make take-or-pay or similar payments regardless of nonperformance by any other party to an agreement; and (c) arrangement (i) to purchase any primary obligation or security therefor, (ii) to supply funds for the purchase or payment of any primary obligation, (iii) to maintain or assure working capital, equity capital, net worth or solvency of the primary obligor, (iv) to purchase Property or services for the purpose of assuring the ability of the primary obligor to perform a primary obligation, or (v) otherwise to assure or hold harmless the holder of any primary obligation against loss in respect thereof. The amount of any Contingent Obligation shall be deemed to be the stated or determinable amount of the primary obligation (or, if less, the maximum amount for which such Person may be liable under the instrument evidencing the Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability with respect thereto.

CWA : the Clean Water Act (33 U.S.C. §§ 1251 et seq .).

Debt : as applied to any Person, without duplication, (a) all items that would be included as liabilities on a balance sheet in accordance with GAAP, including Capital Leases, but excluding trade payables incurred and being paid in the Ordinary Course of Business; (b) all Contingent Obligations; (c) all reimbursement obligations in connection with letters of credit issued for the account of such Person; and (d) in the case of a Borrower, the Obligations. The Debt of a Person shall include any recourse Debt of any partnership in which such Person is a general partner or joint venturer.

Default : an event or condition that, with the lapse of time or giving of notice, would constitute an Event of Default.

Default Rate : for any Obligation (including, to the extent permitted by law, interest not paid when due), 2% plus the interest rate otherwise applicable thereto.

Defaulting Lender : any Lender that (a) fails to make any payment or provide funds to Agent or any Borrower as required hereunder or fails otherwise to perform its obligations under any Loan Document, and such failure is not cured within one Business Day, or (b) is the subject of any Insolvency Proceeding.

Deposit Account : as defined in the UCC.

Deposit Account Control Agreements : (a) in the case of U.S. Borrower or any Domestic Subsidiary, the Deposit Account control agreements to be executed by each institution maintaining a Deposit Account for each such Person, in favor of Agent for the benefit of Secured Parties, as security for the Obligations, each which Deposit Account Control Agreement shall be satisfactory to Agent; and (b) in the case of Singapore Borrower and each Foreign Subsidiary that is an Obligor, the Deposit Account Control Agreements to be executed by each institution maintaining a Deposit Account for each such Person, in favor of Agent for the benefit of the

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Secured Parties, as security for the Singapore Obligations, each which Deposit Account Control Agreement shall be satisfactory to Agent.

Dilution Percent : the percent, determined for each Borrower’s most recent Fiscal Quarter (or such other period as determined by Agent in its discretion) equal to (a) bad debt write-downs or write-offs, discounts, returns, promotions, credits, credit memos and other dilutive items with respect to Accounts included in the Borrowing Base of such Borrower, divided by (b) gross sales of the Accounts included in the Borrowing Base of such Borrower.

Distribution : any declaration or payment of a distribution, interest or dividend on any Equity Interest (other than payment-in-kind); any distribution, advance or repayment of Debt to a holder of Equity Interests; or any purchase, redemption, or other acquisition or retirement for value of any Equity Interest, including dividends pursuant to Section 10.2.3(a)(ii) but excluding repurchases of Equity Interests of U.S. Borrower (i) pursuant to Section 10.2.3(a)(iii) and (ii) the cash-less exercise of a warrant or option to purchase Equity Interests of U.S. Borrower by an employee, officer or director of U.S. Borrower.

Document : as defined in the UCC.

Dollars and $ : lawful money of the United States.

Domestic Subsidiary : a Subsidiary that is not a Foreign Subsidiary.

Dominion Account : (a) a special account of U.S. Borrower established at Bank of America, over which Agent has exclusive control for withdrawal purposes; (b) a special account of Singapore Borrower established at Bank of America-Singapore Branch, over which Agent has exclusive control for withdrawal purposes.

EBITDA : determined on a consolidated basis for U.S. Borrower and its Subsidiaries, net income, calculated before interest expense, provision for income taxes, depreciation and amortization expense, any non-cash items relating to share based employee compensation expenses, any non-cash expenses or charges arising from the Existing Auction Rate Securities, any losses arising from the sale of capital assets, any gains arising from the write-up of assets, and any extraordinary gains (in each case, to the extent included in determining net income).

Eligible Account : an Account owing to a Borrower that arises in the Ordinary Course of Business from the sale of goods, is payable in Dollars and is deemed by Agent, in its discretion, to be an Eligible Account. Without limiting the foregoing, no Account shall be an Eligible Account if:

(a) it is unpaid for more than 60 days after the original due date, or more than 90 days after the original invoice date;

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(b) 25% or more of the Accounts owing by the Account Debtor are not Eligible Accounts under the foregoing clause;

(c) except as set forth in the proviso in this clause and clause (g)(ii), when aggregated with other Accounts owing by the Account Debtor, it exceeds 15% of the aggregate Eligible Accounts (or such higher percentage as Agent may establish for the Account Debtor from time to time); provided , however , in the case of Accounts owing by

(i) [CONFIDENTIAL TREATMENT REQUESTED], it exceeds [CONFIDENTIAL TREATMENT REQUESTED] of the aggregate Eligible Accounts,

(ii) [CONFIDENTIAL TREATMENT REQUESTED], it exceeds [CONFIDENTIAL TREATMENT REQUESTED] of the aggregate Eligible Accounts, or

(iii) [CONFIDENTIAL TREATMENT REQUESTED], it exceeds [CONFIDENTIAL TREATMENT REQUESTED] of the aggregate Eligible Accounts (or, in the case of the preceding clause (i), (ii) or (iii), such other percentage as established for the applicable Account Debtor from time to time by Agent based on Agent’s opinion of the creditworthiness and risk profile of the Account Debtor);

(d) it does not conform with a covenant or representation herein;

(e) it is owing by a creditor or supplier, or is otherwise subject to a potential offset, counterclaim, dispute, deduction, discount, recoupment, reserve, defense, chargeback, credit or allowance (but ineligibility shall be limited to the amount thereof);

(f) an Insolvency Proceeding has been commenced by or against the Account Debtor; or the Account Debtor has suspended or ceased doing business, is liquidating, dissolving or winding up its affairs, or is not Solvent; or a Borrower is not able to bring suit or enforce remedies against the Account Debtor through judicial process;

(g) the Account Debtor is organized or has its principal offices or assets outside the United States or Canada; provided that

(i) notwithstanding the foregoing [CONFIDENTIAL TREATMENT REQUESTED] shall, in any event, be acceptable Account Debtors pursuant to this clause (g) and subject to the concentration limits set forth in clause (c) above; and

(ii) Accounts in which the Account Debtor is organized or has its principal office or assets outside of Brazil, Mexico, China, Vietnam or Thailand

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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may be Eligible Accounts if (A) the applicable Account Debtor is acceptable to Agent, (B) the principal office and assets of the applicable Account Debtor are located in a country that is acceptable to Agent and (C) the aggregate amount of all such Accounts that is included as part of the Aggregate Borrowing Base does not exceed 5% of the Revolver Commitment (it being understood that [CONFIDENTIAL TREATMENT REQUESTED] shall be subject to the requirements preceding clause (g)(i));

(h) it is owing by a Government Authority, unless the Account Debtor is the United States or any department, agency or instrumentality thereof and the Account has been assigned to Agent in compliance with the Assignment of Claims Act;

(i) it is not subject to a duly perfected, first priority Lien in favor of Agent, or is subject to any other Lien;

(j) the goods giving rise to it have not been delivered to and accepted by the Account Debtor, the services giving rise to it have not been accepted by the Account Debtor, or it otherwise does not represent a final sale;

(k) it is evidenced by Chattel Paper or an Instrument of any kind, or has been reduced to judgment;

(l) its payment has been extended, the Account Debtor has made a partial payment, or it arises from a sale on a cash-on-delivery basis;

(m) it arises from a sale to an Affiliate, from a sale on a bill-and-hold, guaranteed sale, sale or return, sale on approval, consignment, or other repurchase or return basis, or from a sale to a Person for personal, family or household purposes;

(n) it represents a progress billing or retainage; or

(o) it includes a billing for interest, fees or late charges, but ineligibility shall be limited to the extent thereof. In calculating delinquent portions of Accounts under clauses (a) and (b), credit balances more than 90 days old will be excluded.

Eligible Assignee : a Person that is (a) a Lender, an Affiliate of a Lender or Approved Fund; (b) any other financial institution approved by Agent and Borrower Agent (which approval by Borrower Agent shall not be unreasonably withheld or delayed, and shall be deemed given if no objection is made within five Business Days after notice of the proposed assignment), that is organized under the laws of the United States or any state or district thereof, has total assets in excess of $5 billion, extends asset-based lending facilities in its ordinary course of business and whose becoming an assignee would not constitute a prohibited transaction under Section 4975 of the Code or any other Applicable Law; and (c) during any Event of Default, any Person (other than a Person engaged in the business of manufacturing or selling flexible printed circuits, value-

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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added component assembly solutions or any other reasonably similar electronics and technology) acceptable to Agent in its discretion.

Enforcement Action : any action to enforce any Obligations or Loan Documents or to realize upon any Collateral (whether by judicial action, self-help, notification of Account Debtors, exercise of setoff or recoupment, or otherwise).

Environmental Laws : all Applicable Laws (including all programs, permits and guidance promulgated by regulatory agencies), relating to public health (but excluding occupational safety and health, to the extent regulated by OSHA) or the protection or pollution of the environment, including CERCLA, RCRA and CWA.

Environmental Notice : a notice (whether written or oral) from any Governmental Authority or other Person of any possible noncompliance with, investigation of a possible violation of, litigation relating to, or potential fine or liability under any Environmental Law, or with respect to any Environmental Release, environmental pollution or hazardous materials, including any complaint, summons, citation, order, claim, demand or request for correction, remediation or otherwise.

Environmental Release : a release as defined in CERCLA or under any other Environmental Law.

Equipment : as defined in the UCC, including all machinery, apparatus, equipment, fittings, furniture, fixtures, motor vehicles and other tangible personal Property (other than Inventory), and all parts, accessories and special tools therefor, and accessions thereto.

Equity Interest : the interest of any (a) shareholder in a corporation; (b) partner in a partnership (whether general, limited, limited liability or joint venture); (c) member in a limited liability company; or (d) other Person having any other form of equity security or ownership interest.

ERISA : the Employee Retirement Income Security Act of 1974.

ERISA Affiliate : any trade or business (whether or not incorporated) under common control with an Obligor within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

ERISA Event : (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Obligor or ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by any Obligor or ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a U.S. Plan amendment as a termination under Section 4041

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) any Obligor or ERISA Affiliate fails to meet any funding obligations with respect to any Pension Plan or Multiemployer Plan, or requests a minimum funding waiver; (f) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (g) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Obligor or ERISA Affiliate.

Event of Default : as defined in Section 11 .

Excluded Tax : with respect to Agent, any Lender, Issuing Bank or any other recipient of a payment to be made by or on account of any Obligation, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located; (b) any branch profits taxes imposed by any jurisdiction in which the relevant Borrower is located; (c) any backup withholding tax required by the Code to be withheld from amounts payable to a Lender that has failed to comply with Section 5.9 ; and (d) in the case of a Foreign Lender, any withholding tax imposed by the jurisdiction in which the relevant Borrower is organized that is (i) required pursuant to laws in force at the time such Lender becomes a Lender (or designates a new Lending Office) hereunder, or (ii) attributable to such Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 5.9 , except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from Borrowers with respect to such withholding tax.

Existing Auction Rate Securities : the auction rate securities reflected in U.S. Borrower’s audited balance sheet as of September 30, 2008 as a long-term investment with a fair value of $12,138,000, as further described in Note 1- Basis of Presentation and Significant Account Policies – Investments, to U.S. Borrower’s audited financial statements for the Fiscal Year ended September 30, 2008.

Extraordinary Expenses : all costs, expenses or advances that Agent may incur during a Default or Event of Default, or during the pendency of an Insolvency Proceeding of an Obligor, including those relating to (a) any audit, inspection, repossession, storage, repair, appraisal, insurance, manufacture, preparation or advertising for sale, sale, collection, or other preservation of or realization upon any Collateral; (b) any action, arbitration or other proceeding (whether instituted by or against Agent, any Lender, any Obligor, any representative of creditors of an Obligor or any other Person) in any way relating to any Collateral (including the validity, perfection, priority or avoidability of Agent’s Liens with respect to any Collateral), Loan Documents, Letters of Credit or Obligations, including any lender liability or other Claims; (c) the exercise, protection or enforcement of any rights or remedies of Agent in, or the monitoring

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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of, any Insolvency Proceeding; (d) settlement or satisfaction of any taxes, charges or Liens with respect to any Collateral; (e) any Enforcement Action; (f) negotiation and documentation of any modification, waiver, workout, restructuring or forbearance with respect to any Loan Documents or Obligations; and (g) Protective Advances. Such costs, expenses and advances include transfer fees, Other Taxes, storage fees, insurance costs, permit fees, utility reservation and standby fees, legal fees, appraisal fees, brokers’ fees and commissions, auctioneers’ fees and commissions, accountants’ fees, environmental study fees, wages and salaries paid to employees of any Obligor or independent contractors in liquidating any Collateral, and travel expenses.

Federal Funds Rate : (a) the weighted average of interest rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on the applicable Business Day (or on the preceding Business Day, if the applicable day is not a Business Day), as published by the Federal Reserve Bank of New York on the next Business Day; or (b) if no such rate is published on the next Business Day, the average rate (rounded up, if necessary, to the nearest 1/8 of 1%) charged to Bank of America on the applicable day on such transactions, as determined by Agent.

Fee Letter : the fee letter agreement between Agent and Borrowers.

Fiscal Month : each month of a Fiscal Year.

Fiscal Quarter : each period of three months, commencing on the first day of a Fiscal Year.

Fiscal Year : the fiscal year of U.S. Borrower and its Subsidiaries for accounting and tax purposes, ending on September 30 of each year.

Fixed Charge Coverage Ratio : the ratio, determined on a consolidated basis for U.S. Borrower and its Subsidiaries for the most recent 12 Fiscal Months, of (a) EBITDA to (b) Fixed Charges.

Fixed Charges : the sum of interest expense (other than payment-in-kind), principal payments made on Borrowed Money, Capital Expenditures (except those financed with Borrowed Money other than Revolver Loans), cash taxes paid and Distributions made.

Fixed Rate Loan : collectively and individually, the LIBOR Revolver Loans, the Singapore Swap Rate Revolver Loans and the SIBOR Revolver Loans.

[CONFIDENTIAL TREATMENT REQUESTED] : [CONFIDENTIAL TREATMENT REQUESTED], a Singapore company, and each following company if it is a Wholly-Owned Subsidiary of [CONFIDENTIAL TREATMENT REQUESTED]; provided that if any of the foregoing companies has its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent it shall not be included as part of this definition.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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FLSA : the Fair Labor Standards Act of 1938.

Foreign Lender : (a) with respect to U.S. Borrower, any Lender that is organized under the laws of a jurisdiction other than the laws of the United States, or any state or district thereof; and (b) with respect to a Singapore Borrower, any Lender that is (i) not a resident in Singapore for Singapore tax purposes and (ii) whose Lending Office has not been granted a waiver by the Inland Revenue Authority of Singapore in respect of payments under Section 12(6) of the Income Tax Act, Chapter 134 of Singapore (“ITA”) to be made to such Lending Office free of Singapore withholding tax.

Foreign Plan : any employee benefit plan or arrangement maintained or contributed to by any Obligor that is not subject to the laws of the United States, or any employee benefit plan or arrangement mandated by a government other than the United States for employees of any Obligor.

Foreign Subsidiary : a Subsidiary that is a “controlled foreign corporation” under Section 957 of the Code, such that a guaranty by such Subsidiary of the Obligations or a Lien on the assets of such Subsidiary to secure the U.S. Obligations would result in material tax liability to Borrowers.

Full Payment : with respect to any Obligations, (a) the full and indefeasible cash payment thereof, including any interest, fees and other charges accruing during an Insolvency Proceeding (whether or not allowed in the proceeding); (b) if such Obligations are LC Obligations or inchoate or contingent in nature, Cash Collateralization thereof (or delivery of a standby letter of credit acceptable to Agent in its discretion, in the amount of required Cash Collateral); and (c) a release of any Claims of Obligors against Agent, Lenders and Issuing Bank arising on or before the payment date. No Revolver Loans shall be deemed to have been paid in full until all Revolver Commitments related to such Revolver Loans have expired or been terminated.

GAAP : generally accepted accounting principles in effect in the United States from time to time.

General Intangibles : as defined in the UCC, including choses in action, causes of action, company or other business records, inventions, blueprints, designs, patents, patent applications, trademarks, trademark applications, trade names, trade secrets, service marks, goodwill, brand names, copyrights, registrations, licenses, franchises, customer lists, permits, tax refund claims, computer programs, operational manuals, internet addresses and domain names, insurance refunds and premium rebates, all rights to indemnification, and all other intangible Property of any kind.

Goods : as defined in the UCC.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Governmental Approvals : all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and required reports to, all Governmental Authorities.

Governmental Authority : any federal, state, municipal, foreign or other governmental department, agency, commission, board, bureau, court, tribunal, instrumentality, political subdivision, or other entity or officer exercising executive, legislative, judicial, regulatory or administrative functions for or pertaining to any government or court, in each case whether associated with the United States, a state, district or territory thereof, or a foreign entity or government.

Guarantors : each Person who guarantees payment or performance of any Obligations.

Hedging Agreement : an agreement relating to any swap, cap, floor, collar, option, forward, cross right or obligation, or combination thereof or similar transaction, with respect to interest rate, foreign exchange, currency, commodity, credit or equity risk.

[CONFIDENTIAL TREATMENT REQUESTED]: [CONFIDENTIAL TREATMENT REQUESTED], provided that such company does not have its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent.

[CONFIDENTIAL TREATMENT REQUESTED]: [CONFIDENTIAL TREATMENT REQUESTED], a New York corporation, and each following company if it is a Wholly-Owned Subsidiary of [CONFIDENTIAL TREATMENT REQUESTED]; provided that if any of the foregoing companies has its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent it shall not be included as part of this definition.

Increase Effective Date : as defined in Section 2.1.7 .

Indemnified Taxes : Taxes other than Excluded Taxes.

Indemnitees : Agent Indemnitees, Lender Indemnitees, Issuing Bank Indemnitees and Bank of America Indemnitees.

Insolvency Proceeding : any case or proceeding commenced by or against a Person, or corporate action or other procedure or step is taken, under any state, provincial, federal or foreign law for or in relation, or any agreement of such Person to, (a) the entry of an order for relief or the filing of a proposal or intent to file a proposal under the Bankruptcy Code or any other insolvency, debtor relief or debt adjustment law; (b) the suspension of payments, a moratorium of any indebtedness, winding-up, judicial management, dissolution, administration or reorganization (by way of voluntary arrangement, scheme of arrangement or otherwise) of such Person; (c) the appointment of a receiver, trustee, liquidator, administrator, judicial manager,

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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conservator or other custodian for such Person or any part of its Property; (d) a composition, compromise, assignment or arrangement with any creditor of such Person; (e) the enforcement of any security over any assets of such Person; (f) an assignment or trust mortgage for the benefit of creditors; (g) the Agent (as Security Agent under the UK Debenture) receiving a notice of intention to appoint, or the taking of any steps in relation to appointing, an administrator to manage the affairs, business and assets of MFlex UK pursuant to the Insolvency Act 1986 or an application being made pursuant to the Insolvency Act 1986 for an administration order to be made in respect of MFlex UK; or (h) any analogous procedure or step is taken in any jurisdiction which would have an analogous or equivalent effect to any of the foregoing clauses (a) to (g) of this definition.

Instrument : as defined in the UCC.

Insurance Assignment : each collateral assignment of insurance pursuant to which an Obligor assigns to Agent, for the benefit of Secured Parties, such Obligor’s rights under business interruption or other insurance policies as Agent deems appropriate, as security for the Obligations; provided that any such assignment by Singapore Borrower or any other Foreign Subsidiary that is an Obligor shall only provide security for the Singapore Obligations.

Intellectual Property : all intellectual and similar Property of a Person, including inventions, designs, patents, copyrights, trademarks, service marks, trade names, trade secrets, confidential or proprietary information, customer lists, know-how, software and databases; all embodiments or fixations thereof and all related documentation, applications, registrations and franchises; all licenses or other rights to use any of the foregoing and all goodwill relating thereto; and all books and records relating to the foregoing.

Intellectual Property Claim : any claim or assertion (whether in writing, by suit or otherwise) that a Borrower’s or Subsidiary’s ownership, use, marketing, sale or distribution of any Inventory, Equipment, Intellectual Property or other Property violates another Person’s Intellectual Property.

Interest Period : as defined in Section 3.1.3 .

Interest Rate Fixing Day : in relation to any period for which the SWAP Rate or SIBOR is agreed or to be agreed or, as the case may be, is determined or to be determined, two Business Days before the first day of that period.

Inventory : as defined in the UCC, including all goods intended for sale, lease, display or demonstration; all work in process; and all raw materials, and other materials and supplies of any kind that are or could be used in connection with the manufacture, printing, packing, shipping, advertising, sale, lease or furnishing of such goods, or otherwise used or consumed in a Borrower’s business (but excluding Equipment).

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Investment : any acquisition of all or substantially all assets of a Person; any acquisition of record or beneficial ownership of any Equity Interests of a Person; or any advance or capital contribution to or other investment in a Person.

Investment Property : as defined in the UCC.

IRS : the United States Internal Revenue Service.

Issuing Bank : U.S. Issuing Bank, in the case of U.S. Letters of Credit issued in favor of U.S. Borrower, and Singapore Issuing Bank, in the case of Singapore Letters of Credit issued in favor of Singapore Borrower.

Issuing Bank Indemnitees : Issuing Bank and its officers, directors, employees, Affiliates, agents and attorneys.

[CONFIDENTIAL TREATMENT REQUESTED]: [CONFIDENTIAL TREATMENT REQUESTED], a Delaware corporation, and each following company if it is a Wholly-Owned Subsidiary of [CONFIDENTIAL TREATMENT REQUESTED]; provided that if any of the foregoing companies has its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent it shall not be included as part of this definition.

LC Application : an application by a Borrower (or Borrower Agent on behalf of any Borrower) to Issuing Bank for issuance of a Letter of Credit, in form and substance satisfactory to Issuing Bank.

LC Conditions : the following conditions necessary for issuance of a Letter of Credit: (a) each of the conditions set forth in Section 6 ; (b) after giving effect to such issuance, the sum of all LC Obligations do not exceed the Letter of Credit Subline, no Overadvance exists and, if no Revolver Loans are outstanding, the U.S. LC Obligations do not exceed the U.S. Borrowing Base (without giving effect to the LC Reserve for purposes of this calculation) and the Singapore LC Obligations do not exceed the Singapore Borrowing Base (without giving effect to the LC Reserve for purposes of this calculation); (c) the expiration date of such Letter of Credit is (i) no more than 365 days from issuance, in the case of standby letters of credit, (ii) no more than 120 days from issuance, in the case of documentary letters of credit, and (iii) at least 20 Business Days prior to the Revolver Termination Date; (d) such Letter of Credit and payments thereunder are denominated in Dollars; and (e) the form of such Letter of Credit is satisfactory to Agent and Issuing Bank in their discretion.

LC Documents : all documents, instruments and agreements (including LC Requests and. LC Applications) delivered by Borrowers or any other Person to Issuing Bank or Agent in connection with issuance, amendment or renewal of, or payment under, any Letter of Credit.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

18

LC Obligations : the U.S. LC Obligations, in the case of U.S. Borrower, or the Singapore LC Obligations, in the case of Singapore Borrower; as the context may require, refers also to the U.S. LC Obligations and the Singapore LC Obligations, collectively.

LC Request : a request for issuance of a Letter of Credit, to be provided by a Borrower (or Borrower Agent on behalf of such Borrower) to Issuing Bank, in form satisfactory to Agent and Issuing Bank.

LC Reserve : with respect to the U.S. Letters of Credit, the aggregate of all U.S. LC Obligations, and with respect to the Singapore Letters of Credit, the Singapore LC Obligations, in each case, other than (a) those that have been Cash Collateralized; and (b) if no Default or Event of Default exists, those constituting charges owing to the Issuing Bank.

Lender Indemnitees : Lenders and their officers, directors, employees, Affiliates, agents and attorneys.

Lenders : as defined in the preamble to this Agreement, including Agent in its capacity as a provider of Swingline Loans and any other Person who hereafter becomes a “Lender” pursuant to an Assignment and Acceptance.

Lending Office : the office designated as such by the applicable Lender at the time it becomes party to this Agreement or thereafter by notice to Agent and Borrower Agent.

Letter of Credit : the U.S. Letters of Credit, in the case of U.S. Borrower, or the Singapore Letters of Credit, in the case of Singapore Borrower; as the context may require, refers also to the U.S. Letters of Credit and the Singapore Letters of Credit, collectively.

Letter of Credit Right : as defined in the UCC.

Letter of Credit Subline : $10,000,000.

LIBOR : for any Interest Period with respect to a LIBOR Revolver Loan, the per annum rate of interest (rounded upward, if necessary, to the nearest 1/16th of 1%), determined by Agent at approximately 11:00 a.m. (London time) two Business Days prior to commencement of such Interest Period, for a term comparable to such Interest Period, equal to (a) the British Bankers Association LIBOR Rate (“ BBA LIBOR ”), as published by Reuters (or other commercially available source designated by Agent); or (b) if BBA LIBOR is not available for any reason, the interest rate at which Dollar deposits in the approximate amount of the LIBOR Revolver Loan would be offered by Bank of America’s London branch to major banks in the London interbank Eurodollar market. If the Board of Governors imposes a Reserve Percentage with respect to LIBOR deposits, then LIBOR shall be the foregoing rate, divided by 1 minus the Reserve Percentage.

LIBOR Revolver Loan : a U.S. Revolver Loan that bears interest based on LIBOR.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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License : any license or agreement under which an Obligor is authorized to use Intellectual Property in connection with any manufacture, marketing, distribution or disposition of Collateral, any use of Property or any other conduct of its business.

Licensor : any Person from whom an Obligor obtains the right to use any Intellectual Property.

Lien : any Person’s interest in Property securing an obligation owed to, or a claim by, such Person, whether such interest is based on common law, statute or contract, including liens, security interests, pledges, hypothecations, statutory trusts, reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting Property.

Lien Waiver : an agreement, in form and substance satisfactory to Agent, by which (a) for any material Collateral located on leased premises, the lessor waives or subordinates any Lien it may have on the Collateral, and agrees to permit Agent to enter upon the premises and remove the Collateral or to use the premises to store or dispose of the Collateral and (b) for any Collateral subject to a Licensor’s Intellectual Property rights, the Licensor grants to Agent the right, vis-à-vis such Licensor, to enforce Agent’s Liens with respect to the Collateral, including the right to dispose of it with the benefit of the Intellectual Property, whether or not a default exists under any applicable License.

Loan Account : the loan account established by each Lender on its books pursuant to Section 5.7 .

Loan Documents : this Agreement, Other Agreements and Security Documents.

Loan Year : each 12 month period commencing on the Closing Date and on each anniversary of the Closing Date.

Local Time : (a) local time in Singapore with respect to the receipt and sending of notices, and the disbursements and payments made with respect to, the Singapore Facility, and (b) local time in California in all circumstances, other than those referred to in the preceding clause (a).

Margin Stock : as defined in Regulation U of the Board of Governors.

Market Disruption Event : before close of business on any Interest Rate Fixing Day for any Interest Period, Agent receives notification from a Lender that the cost to it of obtaining matching deposits in the applicable interbank market would be in excess of SIBOR or the SWAP Rate, as the case may be.

Material Adverse Effect : the effect of any event or circumstance that, taken alone or in conjunction with other events or circumstances, (a) has or could be reasonably expected to have

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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a material adverse effect on the business, operations, Properties, prospects or condition (financial or otherwise) of any Obligor, on the value of any material Collateral, on the enforceability of any Loan Documents, or on the validity or priority of Agent’s Liens on any Collateral; (b) impairs the ability of any Obligor to perform any obligations under the Loan Documents, including repayment of any Obligations; or (c) otherwise impairs the ability of Agent or any Lender to enforce or collect any Obligations or to realize upon any Collateral.

Material Contract : any agreement or arrangement to which a Borrower or any Obligor is party (other than the Loan Documents) (a) for which breach, termination, nonperformance or failure to renew could reasonably be expected to have a Material Adverse Effect or (b) that relates to Subordinated Debt, or Debt in an aggregate amount of $2,000,000 or more (it being agreed that for purposes of this definition, the Debt outstanding pursuant to the Pelikon Notes and the Pelikon Contingent Note shall be aggregated and constitute one Debt obligation.

MFC1 : Multi-Fineline Electronix (Suzhou) Co., Ltd.

MFC2 : Multi-Fineline Electronix (Suzhou No.2) Co., Ltd.

MFC3 Plant : the manufacturing plant proposed to be built by MFC1 or MFC2 at North Shanfeng Road/East Yinzhong South Road, Hedong Industrial Park, Wuzhong Economic Development Zone, Suzhou, Jiangsu Province, People’s Republic of China.

MFlex Cayman : M-Flex Cayman Islands, Inc., a Cayman Islands corporation.

MFlex Malaysia : Multi-Fineline Electronix Malaysia Sdn. Bhd., a Malaysian corporation.

MFlex UK : Pelikon Limited, a company incorporated in England and Wales (registered number 03880306) whose registered office is at Unit R, Trecenydd Industrial Estate, Caerphilly, Glamorgan CF83 2RZ.

Moody’s : Moody’s Investors Service, Inc., and its successors.

[CONFIDENTIAL TREATMENT REQUESTED]: [CONFIDENTIAL TREATMENT REQUESTED], a Delaware corporation, and each following company if it is a Wholly-Owned Subsidiary of [CONFIDENTIAL TREATMENT REQUESTED] [CONFIDENTIAL TREATMENT REQUESTED]; provided that if any of the foregoing companies has its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent it shall not be included as part of this definition.

Multiemployer Plan : any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which any Obligor or ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Net Proceeds : with respect to an Asset Disposition, proceeds (including, when received, any deferred or escrowed payments) received by a Borrower or Subsidiary in cash from such disposition, net of (a) reasonable and customary costs and expenses actually incurred in connection therewith, including legal fees and sales commissions; (b) amounts applied to repayment of Debt secured by a Permitted Lien senior to Agent’s Liens on Collateral sold; (c) transfer or similar taxes; and (d) reserves for indemnities, until such reserves are no longer needed.

Notes : each Revolver Note or other promissory note executed by a Borrower to evidence any Obligations.

Notice of Borrowing : a written notice in the form of Exhibit E or electronic request for Borrowing provided in a manner and in form and substance satisfactory to Agent, to be provided by a Senior Officer of (a) U.S. Borrower to request the funding of a Borrowing of U.S. Revolver Loans or (b) Singapore Borrower to request the funding of a Borrowing of Singapore Revolver Loans.

Notice of Conversion/Continuation : a written notice or electronic request for conversion or continuation of any Revolver Loans provided in a manner and in form and substance satisfactory to Agent, to be provided by a Senior Officer of (a) U.S. Borrower to request a conversion or continuation of any Revolver Loans as LIBOR Revolver Loans or (b) Singapore Borrower (or Borrower Agent on behalf of Singapore Borrower) to request a conversion or continuation of any Revolver Loans as SIBOR Revolver Loans or Singapore Swap Rate Revolver Loans.

Obligations : collectively, the Singapore Obligations and the U.S. Obligations. Agent may exercise its discretion in determining whether an Obligation is a U.S. Obligation or a Singapore Obligation.

Obligor : each Borrower, Guarantor, or other Person that is liable for payment of any Obligations or that has granted a Lien in favor of Agent on its assets to secure any Obligations.

Ordinary Course of Business : the ordinary course of business of any Borrower or Subsidiary, consistent with past practices and undertaken in good faith.

Organic Documents : with respect to any Person, its charter, certificate or articles of incorporation, bylaws, memorandum and articles of organization, memorandum and articles of association, limited liability agreement, operating agreement, members agreement, shareholders agreement, partnership agreement, certificate of partnership, certificate of formation, voting trust agreement, or similar agreement or instrument governing the formation or operation of such Person.

Original Currency : as defined in Section 14.17 .

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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OSHA : the Occupational Safety and Health Act of 1970.

Other Agreement : each Note; LC Document; Lien Waiver; Borrowing Base Certificate, Compliance Certificate, financial statement or report delivered hereunder; or other document, instrument or agreement (other than this Agreement or a Security Document) now or hereafter delivered by an Obligor or other Person to Agent or a Lender in connection with any transactions relating hereto.

Other Taxes : all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.

Overadvance : as defined in Section 2.1.5 .

Overadvance Loan : a Base Rate Revolver Loan made when an Overadvance exists or is caused by the funding thereof.

Participant : as defined in Section 13.2 .

Pass-through Foreign Subsidiary : as defined in Section 7.1.3 .

Patriot Act : the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001).

Payment Intangible : as defined in the UCC.

Payment Item : each check, draft or other item of payment payable to a Borrower, including those constituting proceeds of any Collateral.

PBGC : the Pension Benefit Guaranty Corporation.

Pelikon Contingent Note : the Unsecured Contingent Consideration Promissory Note issued by Singapore Borrower to Michael Powell, as the representative of the holders of the Pelikon Notes, in a principal amount on the Closing Date not to exceed $9,426,000.

Pelikon Contingent Note Reserve : a reserve to be established, at Agent’s discretion based upon the amount of any payment to be made from time to time on the Pelikon Contingent Note (which reserve amount shall not exceed the amount of each relevant payment to be so made).

Pelikon Notes : each of the Unsecured Promissory Notes issued by Singapore Borrower described on Schedule 1.1A, in a principal amount on the Closing Date not to exceed $10,775,844.78.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Pelikon Note Reserve : a reserve to be established, at Agent’s discretion, on July 1, 2010, in an amount equal to $1,783,333 and increased by $1,783,333 on the first of each month thereafter until such time as the Pelikon Note Reserve equals $10,700,000 or such lesser amount as determined by Agent in its discretion based upon the principal payments made on the Pelikon Notes.

Pension Plan : any employee pension benefit plan (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Obligor or ERISA Affiliate or to which the Obligor or ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the preceding five plan years.

Permitted Asset Disposition : as long as all Net Proceeds are remitted to Agent, an Asset Disposition that is (a) a sale of Inventory in the Ordinary Course of Business; (b) a disposition of assets (other than an Account owing to any Borrower) that, in the aggregate during any 12 month period, has a fair market or book value (whichever is more) of $1,000,000 or less; provided that before and after giving effect to any such disposition no Default or Event of Default has occurred and is continuing; (c) a disposition of Inventory that is obsolete, unmerchantable or otherwise unsalable in the Ordinary Course of Business; (d) termination of a lease of real or personal Property that is not necessary for the Ordinary Course of Business, could not reasonably be expected to have a Material Adverse Effect and does not result from an Obligor’s default; (e) a sale of the Existing Auction Rate Securities, (f) consummated as part of the dissolution of Aurora Optical; or (g) approved in writing by Agent and Required Lenders.

Permitted Contingent Obligations : Contingent Obligations (a) arising from endorsements of Payment Items for collection or deposit in the Ordinary Course of Business; (b) arising from Hedging Agreements permitted hereunder; (c) existing on the Closing Date, and any extension or renewal thereof that does not increase the amount of such Contingent Obligation when extended or renewed; (d) incurred in the Ordinary Course of Business with respect to surety, appeal or performance bonds, or other similar obligations; (e) arising from customary indemnification obligations in favor of purchasers in connection with dispositions of Equipment permitted hereunder; (f) arising under the Loan Documents; or (g) in an aggregate amount of $1,000,000 or less at any time.

Permitted Investment Basket : for any Fiscal Year, the sum of (a) the amount set forth in the Capital Expenditures Budget projected to be expended during such Fiscal Year, (b)  minus the amount of Capital Expenditures made during such Fiscal Year, (c)  minus the amount of Restricted Investments made pursuant to clause (e) of such definition during such Fiscal Year, (d)  minus the aggregate principal amount of loans made pursuant Section 10.2.6(e) during such Fiscal Year, and (e)  plus the aggregate principal amount of loans made pursuant to Section 10.2.6(e) that have been repaid in cash to the applicable Borrower during such Fiscal Year.

Permitted Lien : as defined in Section 10.2.2 .

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Permitted Purchase Money Debt : Purchase Money Debt of Borrowers and Subsidiaries that is unsecured or secured only by a Purchase Money Lien, as long as the aggregate amount does not exceed $2,000,000 at any time and its incurrence does not violate Section 10.2.2 .

Person : any individual, corporation, limited liability company, partnership, joint venture, joint stock company, land trust, business trust, unincorporated organization, Governmental Authority or other entity.

Pledged Equity Interests : as defined in Section 7.1.1(m) .

Pledged Notes : as defined in Section 7.1.1(n) , each Pledged Note to be in form and substance reasonably satisfactory to Agent.

Prime Rate : the rate of interest announced by Bank of America from time to time as its prime rate. Such rate is set by Bank of America on the basis of various factors, including its costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above or below such rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

Pro Rata : with respect to any Lender, a percentage (carried out to the ninth decimal place) determined (a) while Revolver Commitments are outstanding, by dividing the amount of such Lender’s Revolver Commitment by the aggregate amount of all Revolver Commitments; and (b) at any other time, by dividing the amount of such Lender’s Revolver Loans and LC Obligations by the aggregate amount of all outstanding Revolver Loans and LC Obligations.

Properly Contested : with respect to any obligation of either Borrower or any Subsidiary thereof, (a) the obligation is subject to a bona fide dispute regarding amount or such Person’s liability to pay; (b) the obligation is being properly contested in good faith by appropriate proceedings promptly instituted and diligently pursued; (c) appropriate reserves have been established in accordance with GAAP; (d) non-payment could not have a Material Adverse Effect, nor result in forfeiture or sale of any assets of such Person; (e) no Lien is imposed on assets of such Person, unless bonded and stayed to the satisfaction of Agent; and (f) if the obligation results from entry of a judgment or other order, such judgment or order is stayed pending appeal or other judicial review.

Property : any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

Protective Advances : as defined in Section 2.1.6 .

Purchase Money Debt : (a) Debt (other than the Obligations) for payment of any of the purchase price of fixed assets; (b) Debt (other than the Obligations) incurred within 10 days

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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before or after acquisition of any fixed assets, for the purpose of financing any of the purchase price thereof; and (c) any renewals, extensions or refinancings (but not increases) thereof.

Purchase Money Lien : a Lien that secures Purchase Money Debt, encumbering only the fixed assets acquired with such Debt and constituting a Capital Lease or a purchase money security interest under the UCC.

RCRA : the Resource Conservation and Recovery Act (42 U.S.C. §§ 6991-6991i).

Real Estate : all right, title and interest (whether as owner, lessor or lessee) in any real Property or any buildings, structures, parking areas or other improvements thereon.

Reference Banks : in relation to SIBOR, the principal Singapore office of Bank of America, N.A. and, in relation to the SWAP Rate, the principal Singapore office of Bank of America, N.A. or such other banks as may be appointed by Agent in consultation with Singapore Borrower.

Refinancing Conditions : the following conditions for Refinancing Debt: (a) it is in an aggregate principal amount that does not exceed the principal amount of the Debt being extended, renewed or refinanced; (b) it has a final maturity no sooner than, a weighted average life no less than, and an interest rate no greater than, the Debt being extended, renewed or refinanced; (c) it is subordinated to the Obligations at least to the same extent as the Debt being extended, renewed or refinanced; (d) the representations, covenants and defaults applicable to it are no less favorable to Borrowers than those applicable to the Debt being extended, renewed or refinanced; (e) no additional Lien is granted to secure it; (f) no additional Person is obligated on such Debt; and (g) upon giving effect to it, no Default or Event of Default exists.

Refinancing Debt : Borrowed Money that is the result of an extension, renewal or refinancing of Debt permitted under Section 10.2.1(b) , (d)  or (f) .

Reimbursement Date : as defined in Section 2.2.2 .

Rent and Charges Reserve : the aggregate of (a) all past due rent and other amounts owing by an Obligor to any landlord or other Person who owns or controls the real property in which any books and records relating to the Accounts of Borrowers is located or could assert a Lien on any such books and records; and (b) a reserve at least equal to three months rent and other charges that could be payable to any such Person, unless it has executed a Lien Waiver.

Report : as defined in Section 12.2.3 .

Reportable Event : any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Required Lenders : Lenders (subject to Section 4.2 ) having (a) Revolver Commitments in excess of 50% of the aggregate Revolver Commitments; and (b) if the Revolver Commitments have terminated, Revolver Loans in excess of 50% of all outstanding Revolver Loans; provided , however , that at any time there are not more than two Lenders, “Required Lenders” means the consent of both Lenders.

Reserve Percentage : the reserve percentage (expressed as a decimal, rounded upward to the nearest 1/16th of 1%) applicable to member banks under regulations issued from time to time by the Board of Governors for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “ Eurocurrency liabilities ”).

Restricted Investment : any Investment by a Borrower or Obligor, other than

(a) Investments in Subsidiaries to the extent existing on the Closing Date;

(b) Cash Equivalents, provided that in the case of Borrowers and the other Obligors such Cash Equivalents are subject to Agent’s Lien and control, pursuant to documentation in form and substance satisfactory to Agent;

(c) loans and advances permitted under Section 10.2.6 ;

(d) amounts deposited in accounts for the purpose of paying, in the Ordinary Course of Business, payroll, payroll taxes or employee benefits;

(e) other Investments to fund Capital Expenditures in an aggregate amount not to exceed the Permitted Investment Basket;

(f) other Investments to fund payroll, payroll taxes and other operating expenses of MFlex Malaysia, in each case to the extent that the foregoing are incurred in the Ordinary Course of Business of MFlex Malaysia, in an aggregate amount not to exceed the lesser of (A) [CONFIDENTIAL TREATMENT REQUESTED] and (B) the amount set forth in the quarterly budget referred to in sub-clause (iii) in the parenthetical following clause (h) in this definition minus the aggregate principal amount of loans outstanding on such date pursuant to Section 10.2.6(g) to MFlex Malaysia;

(g) other Investments to fund payroll, payroll taxes and other operating expenses of MFlex UK, in each case to the extent that the foregoing are incurred in the Ordinary Course of Business of MFlex UK, in an aggregate amount not to exceed the lesser of (A) [CONFIDENTIAL TREATMENT REQUESTED] and (B) the amount set forth in the quarterly budget referred to in sub-clause (iii) in the parenthetical following clause (h) in this definition minus the aggregate principal amount of loans outstanding on such date pursuant to Section 10.2.6(h) to MFlex UK;

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(h) other Investments to fund payroll, payroll taxes and other operating expenses of Subsidiaries (other than MFlex Cayman and MFlex UK), in each case to the extent that the foregoing are incurred in the Ordinary Course of Business of each such Subsidiary in an aggregate amount not to exceed on any date $50,000 minus the aggregate principal amount of loans outstanding on such date pursuant to Section 10.2.6(i) to such Subsidiaries ( provided that with respect to the making of any Investment pursuant to

(i) clauses (e) through (g) (other than an Investment which is applied to pay payroll or payroll taxes) Borrowers are in compliance with Section 10.3.1 if a Trigger Period is continuing at the time of making such Investment,

(ii) clause (h) (other than an Investment which is applied to pay payroll or payroll taxes) no Default or Event of Default exists at the time thereof or after giving effect thereto, and

(iii) clause (f) or (g), Borrower Agent has delivered a quarterly budget that is acceptable to Agent); and

(i) other Investments if

(i) no Default or Event of Default has occurred and is continuing or would result therefrom, (ii) the Aggregate Availability after giving effect to any such Investment is not less than 20% of the Revolver Commitments,

(iii) the Fixed Charge Coverage Ratio after giving effect to any such Investment is, at any time on or before March 31, 2009, at least 0.90 to 1.0 or, at any time thereafter, not less than 1.0 to 1.0, and

(iv) the aggregate amount of such Investments (A) made at any one time or as part of a series of related Investments shall not exceed [CONFIDENTIAL TREATMENT REQUESTED] in the aggregate or (B) since the Closing Date shall not exceed [CONFIDENTIAL TREATMENT REQUESTED] in the aggregate minus the aggregate amount of Distributions made pursuant to Section 10.2.3(ii) .

Restrictive Agreement : an agreement (other than a Loan Document) that conditions or restricts the right of any Borrower or other Obligor to incur or repay Borrowed Money, to grant Liens on any assets, to declare or make Distributions, to modify, extend or renew any agreement evidencing Borrowed Money, or to repay any intercompany Debt.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Revolver Commitment : for any Lender, its obligation to make Revolver Loans and to participate in LC Obligations up to the maximum principal amount shown in Schedule 1.1 as such amount may be increased from time to time pursuant to Section 2.1.7 , or as hereafter determined pursuant to each Assignment and Acceptance to which it is a party. “Revolver Commitments” means the aggregate amount of such commitments of all Lenders.

Revolver Loan : collectively, each U.S. Revolver Loan and Singapore Revolver Loan.

Revolver Note : a promissory note to be executed by Borrowers in favor of a Lender in the form of Exhibit A , which shall be in the amount of such Lender’s Revolver Commitment and shall evidence the Revolver Loans made by such Lender.

Revolver Termination Date : February 20, 2012.

Royalties : all royalties, fees, expense reimbursement and other amounts payable by a Borrower under a License.

S&P : Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.

Screen Rate :

(a) in relation to SIBOR, the arithmetic average (rounded upwards to five decimal places) of the displayed rates for the relevant period appearing under the heading page “SIBO” on the Reuters screen; and

(b) in relation to the SWAP Rate, the rate per annum (expressed as a percentage) for the relevant period appearing under the caption “ASSOCIATION OF BANKS IN SINGAPORE SIBOR AND SWAP OFFER RATES AT 11 A.M. SINGAPORE TIME” and the row headed “SGD” on the page “ABSIRFIX01” of the Reuters Monitor Money Rates Service Screen.

If the agreed page is replaced or the service ceases to be available, Agent may specify another page or service displaying the appropriate rate after consultation with Borrowers and the Lenders.

Second Currency : as defined in Section 14.17 .

Secured Parties : Agent (including as Security Agent under the Singapore Debenture, the Singapore Share Charge, the UK Debenture and UK Share Charge), Issuing Bank, Lenders and providers of Bank Products.

Security Documents : the Insurance Assignments, Deposit Account Control Agreements, the UK Debenture, the UK Share Charge, the Singapore Debenture, the Singapore Share Charge,

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

29

the Cayman Share Charge and all other documents, instruments and agreements now or hereafter securing (or given with the intent to secure) or guaranteeing the payment of any Obligations, including those agreements entered into pursuant to Section 10.1.9 .

Senior Officer : the chairman of the board, president, chief executive officer or chief financial officer of a Borrower or, if the context requires, an Obligor.

Settlement Report : a report delivered by Agent to Lenders summarizing the Revolver Loans and participations in LC Obligations outstanding as of a given settlement date, allocated to Lenders on a Pro Rata basis in accordance with their Revolver Commitments.

SIBOR : for any Interest Period with respect to a SIBOR Revolver Loan:

(a) the applicable Screen Rate; or

(b) if no Screen Rate is available for U.S. Dollars for the Interest Period of that Revolver Loan, the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to Agent at its request quoted by the Reference Banks to leading banks in the Singapore interbank market, appearing as of 11:00 a.m. (Local Time) on the Interest Rate Fixing Day for the offering of deposits in U.S. Dollars for a period comparable to the Interest Period for that Revolver Loan.

SIBOR Revolver Loan : a Singapore Revolver Loan that bears interest based on SIBOR.

Singapore Availability : the Singapore Borrowing Base minus the aggregate principal amount of all Singapore Revolver Loans and all Singapore LC Obligations.

Singapore Base Rate Revolver Loan : a Singapore Revolver Loan that bears interest based on the Base Rate.

Singapore Borrowing Base : on any date of determination, an amount equal to (a) the lesser of (i) the Accounts Formula Amount attributable to Singapore Borrower minus the Availability Block to the extent attributable to Singapore Borrower in Agent’s discretion, or (ii) the Revolver Commitment minus (b) the Availability Reserve to the extent attributable to Singapore Borrower in Agent’s discretion.

Singapore Debenture : the Debenture of Singapore Borrower, in form and substance satisfactory to Agent, executed and delivered by Singapore Borrower to Agent on the Closing Date.

Singapore Facility : the credit facility described in Section 2.1.1(b) hereof to be provided to Singapore Borrower on the terms and conditions set forth in this Agreement.

Singapore Issuing Bank : Bank of America- Singapore Branch.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Singapore LC Obligations : the sum (without duplication) of (a) all amounts owing by Singapore borrower for any drawings under Singapore Letters of Credit; (b) the stated amount of all outstanding Singapore Letters of Credit; and (c) all fees and other amounts owing with respect to Singapore Letters of Credit.

Singapore Letters of Credit : any standby or documentary letter of credit issued by Singapore Issuing Bank for the account of Singapore Borrower, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit support issued by Agent or Singapore Issuing Bank for the benefit of Singapore Borrower.

Singapore Obligations : (a)(i) the principal of and premium, if any, and interest on, the Singapore Revolver Loans made hereunder to, or for the benefit of, Singapore Borrower, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise (including any interest that accrues after the commencement of any case or proceeding by or against Singapore Borrower under any debtor relief law, whether or not allowed in such case or proceeding), and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of Singapore Borrower to a Lender or Singapore Issuing Bank under this Agreement and the other Loan Documents (including the Singapore LC Obligations), (b) the due and punctual payment and performance of all covenants, agreements, obligations and liabilities of Singapore Borrower under or pursuant to this Agreement or the other Loan Documents, (c) obligations of Singapore Borrower under any indemnity for Claims, (d) Extraordinary Expenses of Singapore Borrower, (e) Bank Product Debt, and (f) other Debts, obligations and liabilities of any kind owing by Singapore Borrower pursuant to the Loan Documents, whether now existing or hereafter arising, whether evidenced by a note or other writing, whether allowed in any Insolvency Proceeding, whether arising from an extension of credit, issuance of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise, and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or several.

Singapore Revolver Loan : any revolving loan made by Lenders to Singapore Borrower pursuant to the terms of Section 2.1.1(b) hereof, and any Singapore Swingline Loan, Overadvance Loan or Protective Advance attributable to Singapore Borrower.

Singapore Share Charge : the Share Charge of MFlex Cayman in respect of its Equity Interests in Singapore Borrower, in form and substance satisfactory to Agent, executed and delivered by MFlex Cayman on the Closing Date.

Singapore Swap Rate Revolver Loan : a Singapore Revolver Loan that bears interest based on the SWAP Rate.

Singapore Swingline Loan : any Borrowing of Singapore Base Rate Revolver Loans funded with Agent’s funds, until such Borrowing is settled among Lenders or repaid by Singapore Borrower.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Solvent : as to any Person, (I) if such Person is U.S. Borrower or a Domestic Subsidiary (a) owns Property whose fair salable value is greater than the amount required to pay all of its debts (including contingent, subordinated, unmatured and unliquidated liabilities); (b) owns Property whose present fair salable value (as defined below) is greater than the probable total liabilities (including contingent, subordinated, unmatured and unliquidated liabilities) of such Person as they become absolute and matured; (c) is able to pay all of its debts as they mature; (d) has capital that is not unreasonably small for its business and is sufficient to carry on its business and transactions and all business and transactions in which it is about to engage; (e) is not “insolvent” within the meaning of Section 101(32) of the Bankruptcy Code; and (f) has not incurred (by way of assumption or otherwise) any obligations or liabilities (contingent or otherwise) under any Loan Documents, or made any conveyance in connection therewith, with actual intent to hinder, delay or defraud either present or future creditors of such Person or any of its Affiliates. “Fair salable value” means the amount that could be obtained for assets within a reasonable time, either through collection or through sale under ordinary selling conditions by a capable and diligent seller to an interested buyer who is willing (but under no compulsion) to purchase; (II) if such Person is Singapore Borrower, such Person is neither (a) insolvent or unable to pay all of its debts (including subordinated and contingent debts) nor (b) determined by a court to be unable to pay its debts within the meaning of Section 254(2) of the Companies Act, Chapter 50 of Singapore; and (III) if such Person is a Foreign Subsidiary (other than Singapore Borrower) (a) owns Property whose fair salable value is greater than the amount required to pay all of its debts (including contingent, subordinated, unmatured and unliquidated liabilities); (b) owns Property whose present fair salable value (as defined below) is greater than the probable total liabilities (including contingent, subordinated, unmatured and unliquidated liabilities) of such Person as they become absolute and matured; (c) is able to pay all of its debts as they mature; (d) has capital that is not unreasonably small for its business and is sufficient to carry on its business and transactions and all business and transactions in which it is about to engage; and (e) is not “insolvent” within the meaning of Applicable Law.

[CONFIDENTIAL TREATMENT REQUESTED]: [CONFIDENTIAL TREATMENT REQUESTED]; provided that such company does not have its principal office or any assets in any of Brazil, China, Mexico, Vietnam, Thailand or any other country that is not acceptable to Agent.

Subordinated Debt : Debt incurred by a Borrower that is expressly subordinate and junior in right of payment to Full Payment of all Obligations, and is on terms (including the amount, maturity, interest, fees, repayment, covenants and subordination) satisfactory to Agent.

Subsidiary : (a) any entity at least 50% of whose voting securities or Equity Interests is owned by a Borrower or any combination of Borrowers (including indirect ownership by a Borrower through other entities in which such Borrower directly or indirectly owns 50% of the voting securities or Equity Interests) or (b) in relation to Singapore Borrower, a subsidiary within the meaning of Section 5 of the Companies Act, Chapter 50 of Singapore.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Supporting Obligation : as defined in the UCC.

SWAP Rate : in relation to any Singapore Swap Rate Revolver Loan:

(a) the applicable Screen Rate as of the 11:00 a.m. (Local Time) on the Interest Rate Fixing Day for the displaying of the swap offer rate for a period comparable to the Interest Period for that Revolver Loan; or

(b) if no Screen Rate is available for the Interest Period of that Revolver Loan, the arithmetic mean of the rates (rounded upwards to four decimal places), as supplied to Agent at its request quoted by the Reference Banks to leading banks in the Singapore interbank market, to be in relation for the Interest Period for that Revolver Loan, equal to Y (rounded upwards to four decimal places) calculated in accordance with the following formula:

 

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Swingline Loan : collectively the U.S. Swingline Loans and the Singapore Swingline Loans.

Taxes : all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

Transferee : any actual or potential Eligible Assignee, Participant or other Person acquiring an interest in any Obligations.

Trigger Commencement Date : any day that (a) a Default or an Event of Default occurs or (b) the Aggregate Availability is less than 20% of the Revolver Commitment.

Trigger Period : the period (a) commencing on the Trigger Commencement Date and (b) ending on the Trigger Termination Date.

Trigger Termination Date : any day following a Trigger Commencement Date when both (a) all Defaults and any Events of Default are no longer continuing, and (b) if the circumstances described in clause (b) of the definition of “Trigger Commencement Date” caused or followed the occurrence of any Trigger Commencement Date, for the 90 consecutive day period preceding such date the Aggregate Availability is greater than 25% of the Revolver Commitment.

Type : any type of a Revolver Loan (i.e., Base Rate Revolver Loan, SIBOR Revolver Loan, Singapore Swap Rate Revolver Loan, or LIBOR Revolver Loan) that has the same interest option and, in the case of LIBOR Revolver Loans, SIBOR Revolver Loans or Singapore Swap Rate Revolver Loans, the same Interest Period.

UCC : the Uniform Commercial Code as in effect in the State of California or, when the laws of any other jurisdiction govern the perfection or enforcement of any Lien, the Uniform Commercial Code of such jurisdiction.

UK Debenture : the Debenture of MFlex UK, in form and substance satisfactory to Agent, executed and delivered by MFlex UK to Agent on the Closing Date.

UK Share Charge : the Share Charge of Singapore Borrower in respect of its Equity Interests in MFlex UK, in form and substance satisfactory to Agent, executed and delivered by Singapore Borrower to Agent on the Closing Date.

Unfunded Pension Liability : the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Upstream Payment : a Distribution by (a) a Subsidiary of a Borrower to such Borrower, (b) a Subsidiary that is not an Obligor to an Obligor or (c) Singapore Borrower to U.S. Borrower (it being agreed that such Distribution, in a substantially contemporaneous transaction, shall be transmitted through MFlex Cayman to U.S. Borrower).

U.S. Availability : the U.S. Borrowing Base minus the aggregate principal amount of all U.S. Revolver Loans and all U.S. LC Obligations.

U.S. Base Rate Revolver Loan : a U.S. Revolver Loan that bears interest based on the Base Rate.

U.S. Borrowing Base : on any date of determination, an amount equal to (a) the lesser of (i) the Accounts Formula Amount attributable to U.S. Borrower minus the Availability Block to the extent attributable to U.S. Borrower in Agent’s discretion or (ii) the Revolver Commitment, minus (b) the Availability Reserve to the extent attributable to U.S. Borrower in Agent’s discretion.

U.S. Facility : the credit facility described in Section 2.1.1(a) hereof to be provided to U.S. Borrower on the terms and conditions set forth in this Agreement.

U.S. Issuing Bank : Bank of America or an Affiliate of Bank of America.

U.S. LC Obligations : the sum (without duplication) of (a) all amounts owing by U.S. Borrower for any drawings under U.S. Letters of Credit; (b) the stated amount of all outstanding U.S. Letters of Credit; and (c) all fees and other amounts owing with respect to U.S. Letters of Credit.

U.S. Letter of Credit : any standby or documentary letter of credit issued by U.S. Issuing Bank for the account of U.S. Borrower, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit support issued by Agent or U.S. Issuing Bank for the benefit of U.S. Borrower.

U.S. Obligations : (a)(i) the principal of and premium, if any, and interest on, the U.S. Revolver Loans made hereunder to, or for the benefit of, U.S. Borrower, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise (including any interest that accrues after the commencement of any case or proceeding by or against U.S. Borrower under any debtor relief law, whether or not allowed in such case or proceeding), and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of U.S. Borrower to a Lender or U.S. Issuing Bank under this Agreement and the other Loan Documents (including the U.S. LC Obligations), (b) the due and punctual payment and performance of all covenants, agreements, obligations and liabilities of U.S. Borrower under or pursuant to this Agreement or the other Loan Documents, (c) obligations of U.S. Borrower under any indemnity for Claims, (d) Extraordinary Expenses of U.S. Borrower, (e) Bank Product Debt, and (f) other

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Debts, obligations and liabilities of any kind owing by U.S. Borrower pursuant to the Loan Documents, whether now existing or hereafter arising, whether evidenced by a note or other writing, whether allowed in any Insolvency Proceeding, whether arising from an extension of credit, issuance of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise, and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or several.

U.S. Plan : any employee benefit plan (as such term is defined in Section 3(3) of ERISA) established by an Obligor or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, an ERISA Affiliate.

U.S. Revolver Loan : any revolving loan made to U.S. Borrower pursuant to Section 2.1.1(a) , and any U.S. Swingline Loan, Overadvance Loan or Protective Advance attributable to U.S. Borrower.

U.S. Swingline Loan : any Borrowing of U.S. Base Rate Revolver Loans funded with Agent’s funds, until such Borrowing is settled among Lenders or repaid by U.S. Borrower.

Value : for an Account, its face amount, net of any returns, rebates, discounts (calculated on the shortest terms), credits, allowances or Taxes (including sales, excise or other taxes) that have been or could be claimed by the Account Debtor or any other Person.

Wholly-Owned Subsidiary : any Subsidiary of which 100% of its Equity Interests (except in the case of a corporation for directors’ qualifying shares) is owned, either directly or indirectly, by a Borrower or any combination of Borrowers.

1.2. Accounting Terms . Under the Loan Documents (except as otherwise specified herein), all accounting terms shall be interpreted, all accounting determinations shall be made, and all financial statements shall be prepared, in accordance with GAAP applied on a basis consistent with the most recent audited financial statements of U.S. Borrower delivered to Agent before the Closing Date and using the same inventory valuation method as used in such financial statements, except for any change required or permitted by GAAP if Borrowers’ certified public accountants concur in such change, the change is disclosed to Agent, and Section 10.3 is amended in a manner satisfactory to Required Lenders to take into account the effects of the change.

1.3. Certain Matters of Construction . The terms “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision. Any pronoun used shall be deemed to cover all genders. In the computation of periods of time from a specified date to a later specified date, “from” means “from and including,” and “to” and “until” each mean “to but excluding.” The terms “including” and “include” shall mean “including, without limitation” and, for purposes of each Loan Document, the parties agree that the rule of ejusdem generis shall not be applicable to limit any provision. Section titles appear as a matter of convenience only and shall not affect the

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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interpretation of any Loan Document. All references to (a) laws or statutes include all related rules, regulations, interpretations, amendments and successor provisions; (b) any document, instrument or agreement include any amendments, waivers and other modifications, extensions or renewals (to the extent permitted by the Loan Documents); (c) any section mean, unless the context otherwise requires, a section of this Agreement; (d) any exhibits or schedules mean, unless the context otherwise requires, exhibits and schedules attached hereto, which are hereby incorporated by reference; (e) any Person include successors and assigns; or (f) unless otherwise specified, discretion of Agent, Issuing Bank or any Lender mean the sole and absolute discretion of such Person. A Default or Event of Default shall be deemed to exist at all times during the period commencing on the date that such Default or Event of Default occurs to the date on which such Default or Event of Default is waived by the Required Lenders pursuant to this Agreement or, in the case of a Default, is cured (as confirmed by Agent) within any period of cure expressly provided for in this Agreement. All calculations of Value, fundings of Revolver Loans, issuances of Letters of Credit and payments of Obligations shall be in Dollars and, unless the context otherwise requires, all determinations (including calculations of Borrowing Base and financial covenants) made from time to time under the Loan Documents shall be made in light of the circumstances existing at such time. Borrowing Base calculations shall be consistent with historical methods of valuation and calculation, and otherwise satisfactory to Agent (and not necessarily calculated in accordance with GAAP). Borrowers shall have the burden of establishing any alleged negligence, misconduct or lack of good faith by Agent, Issuing Bank or any Lender under any Loan Documents. No provision of any Loan Documents shall be construed against any party by reason of such party having, or being deemed to have, drafted the provision. Whenever the phrase “to the best of Borrowers’ knowledge” or words of similar import are used in any Loan Documents, it means actual knowledge of a Senior Officer or controller of a Borrower, or knowledge that a Senior Officer or such controller would have obtained if he or she had engaged in good faith and diligent performance of his or her duties, including reasonably specific inquiries of employees or agents and a good faith attempt to ascertain the matter to which such phrase relates.

SECTION 2. CREDIT FACILITIES

2.1. Revolver Commitment .

2.1.1. Revolver Loans .

(a) U.S. Revolver Loans . Each Lender agrees, severally on a Pro Rata basis up to its Revolver Commitment, on the terms set forth herein, to make U.S. Revolver Loans to U.S. Borrower from time to time through the Commitment Termination Date. The U.S. Revolver Loans may be repaid and reborrowed as provided herein. In no event shall Lenders have any obligation to honor a request for a U.S. Revolver Loan if, after giving effect thereto, (i) the aggregate principal amount of all U.S. Revolver Loans and all U.S. LC Obligations would exceed the lesser of the U.S. Borrowing Base or the Revolver Commitment, or (ii) the aggregate principal amount of all Revolver Loans and

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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all LC Obligations would exceed the lesser of the Aggregate Borrowing Base or the Revolver Commitment.

(b) Singapore Revolver Loans . Each Lender agrees, severally on a Pro Rata basis up to its Revolver Commitment, on the terms set forth herein, to make Singapore Revolver Loans to Singapore Borrower from time to time through the Commitment Termination Date. The Singapore Revolver Loans may be repaid and reborrowed as provided herein. In no event shall Lenders have any obligation to honor a request for a Singapore Revolver Loan if, after giving effect thereto, (i) the aggregate principal amount of all Singapore Revolver Loans and all Singapore LC Obligations would exceed the lesser of the Singapore Borrowing Base and the Revolver Commitment, or (ii) the aggregate principal amount of all Revolver Loans and all LC Obligations would exceed the lesser of the Aggregate Borrowing Base and the Revolver Commitment.

2.1.2. Revolver Notes . The Revolver Loans made by each Lender and interest accruing thereon shall be evidenced by the records of Agent and such Lender. At the request of any Lender, each Borrower shall deliver a Revolver Note to such Lender.

2.1.3. Use of Proceeds . The proceeds of Revolver Loans shall be used by each Borrower solely to finance Capital Expenditures, for working capital and other lawful corporate purposes of such Borrower.

2.1.4. Termination of Revolver Commitments .

(a) The Revolver Commitments shall terminate on the Revolver Termination Date, unless sooner terminated in accordance with this Agreement. Upon at least 90 days prior written notice to Agent, Borrowers may, at their option, terminate the Revolver Commitments and this credit facility. Any notice of termination given by Borrowers shall be irrevocable. On the termination date, U.S. Borrower shall make Full Payment of all U.S. Obligations and Singapore Borrower shall make Full Payment of all Singapore Obligations.

(b) Concurrently with any termination of the Revolver Commitments, for whatever reason (including an Event of Default), Borrowers shall pay to Agent, for the Pro Rata benefit of Lenders and as liquidated damages for loss of bargain (and not as a penalty), an amount equal to (i) if the termination occurs during the first Loan Year, 1.0% of the Revolver Commitments being terminated; (ii) if it occurs during the second Loan Year, 0.50% of the Revolver Commitments being terminated; and (iii) if it occurs thereafter, 0.25% of the Revolver Commitments being terminated. No termination charge shall be payable if termination occurs on the Revolver Termination Date or in connection with a refinancing of this credit facility by Bank of America or any of its Affiliates.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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2.1.5. Overadvances . If the aggregate principal amount of all Revolver Loans and LC Obligations of either Borrower exceeds the Borrowing Base of such Borrower at any time (each an “ Overadvance ”), the excess amount shall be payable by such Borrower on demand by Agent, but all such Revolver Loans shall nevertheless constitute U.S. Obligations or Singapore Obligations, as the case may be, secured by the applicable Collateral and entitled to all benefits of the Loan Documents. Unless its authority has been revoked in writing by Required Lenders, Agent may require Lenders to honor requests for Overadvance Loans and to forbear from requiring Borrowers to cure an Overadvance, (a) when no other Event of Default is known to Agent, as long as (i) the Overadvance does not continue for more than 30 consecutive days (and no Overadvance may exist for at least five consecutive days thereafter before further Overadvance Loans are required), and (ii) the Overadvance is not known by Agent to exceed 10% of the Aggregate Borrowing Base; and (b) regardless of whether an Event of Default exists, if Agent discovers an Overadvance not previously known by it to exist, as long as from the date of such discovery the Overadvance (i) is not increased by more than 10% of the Revolver Commitment, and (ii) does not continue for more than 30 consecutive days. In no event shall Overadvance Loans be required that would cause the outstanding Revolver Loans and LC Obligations to exceed the aggregate Revolver Commitments minus the Availability Reserve. Any funding of an Overadvance Loan or sufferance of an Overadvance shall not constitute a waiver by Agent or Lenders of the Event of Default caused thereby. In no event shall any Borrower or other Obligor be deemed a beneficiary of this Section nor authorized to enforce any of its terms.

2.1.6. Protective Advances . Agent shall be authorized, in its discretion, at any time that any conditions in Section 6 are not satisfied, and without regard to the Aggregate Availability, Singapore Availability or U.S. Availability, to make Base Rate Revolver Loans (“ Protective Advances ”) (a) up to an aggregate amount of 10% of the Revolver Commitment outstanding at any time, if Agent deems such Revolver Loans necessary or desirable to preserve or protect Collateral, or to enhance the collectibility or repayment of Obligations; or (b) to pay any other amounts chargeable to Obligors under any Loan Documents, including costs, fees and expenses. All Protective Advances allocable to the Singapore Obligations (as determined by Agent) shall be Singapore Obligations, secured by the applicable Collateral; all Protective Advances allocable to the U.S. Obligations (as determined by Agent) shall be U.S. Obligations, secured by the applicable Collateral. All Protective Advances shall be treated for all purposes as Extraordinary Expenses. Each Lender shall participate in each Protective Advance on a Pro Rata basis. Required Lenders may at any time revoke Agent’s authority to make further Protective Advances by written notice to Agent. Absent such revocation, Agent’s determination that funding of a Protective Advance is appropriate shall be conclusive.

2.1.7. Increases in Revolver Commitments .

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(a) Provided there exists no Default or Event of Default, and subject to the other terms and conditions of this Section 2.1.7 , upon notice to Agent and Lenders Borrower Agent (on behalf of Borrowers) may request, twice during the term of this Agreement, that the Revolver Commitments be increased by an aggregate amount equal to $30,000,000. Each Lender shall notify Agent within 10 Business Days from the date of delivery of each such notice whether or not it agrees to increase its Revolver Commitment and, if so, whether by an amount equal to, greater than, or less than its Pro Rata share of such requested increase. Any Lender not responding within such time period shall be deemed to have declined to increase its Revolver Commitment. Agent shall notify Borrower Agent and each Lender of the Lenders’ responses to each request made hereunder. If the existing Lenders shall have declined to provide the full amount of the requested increase, to achieve the full amount of the requested increase Agent may (in consultation with Borrower Agent), request that additional lending institutions that constitute Eligible Assignees become Lenders pursuant to a joinder agreement in form and substance satisfactory to Agent and its counsel. Nothing in this Agreement shall be construed to obligate any Lender to increase its Revolver Commitment.

(b) If the Revolver Commitments are increased in accordance with this Section 2.1.7 , Agent and Borrowers shall determine the effective date of each such increase in the Revolver Commitment (the date of each such increase being the “ Increase Effective Date ”), and Agent shall determine the final allocation of such increase. Agent shall promptly notify Borrower Agent and the Lenders of the final allocation of such increase and the applicable Increase Effective Date. As a condition precedent to such increase, (i) Agent shall have received amendments to this Agreement and the Loan Documents, joinder agreements, and all other promissory notes, agreements, documents and instruments requested by Agent in its discretion; and (ii) Borrowers shall (A) pay to Agent (1) for the account of each Lender that is increasing its Revolver Commitment, a closing fee as agreed by Borrower Agent and such Lenders, and (2) for Agent’s own account the fees and reasonable expenses of Agent incurred in connection with such increase; and (B) deliver to Agent a certificate of a Senior Officer of Borrower Agent dated as of the applicable Increase Effective Date, certifying (1) attached true and correct copies of the resolutions adopted by Borrowers approving or consenting to such increase, and (2) that, before and after giving effect to such increase, (x) the representations and warranties contained in Section 9 of the Agreement and the other Loan Documents are true and correct in all material respects on and as of the applicable Increase Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and (y) no Default or Event of Default exists.

2.2. Letter of Credit Facility .

2.2.1. Issuance of Letters of Credit . Issuing Bank agrees to issue Letters of Credit from time to time until 30 days prior to the Revolver Termination Date (or until

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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the Commitment Termination Date, if earlier), on the terms set forth herein, including the following:

(a) Each Borrower acknowledges that Issuing Bank’s willingness to issue any Letter of Credit is conditioned upon Issuing Bank’s receipt of a LC Application with respect to the requested Letter of Credit, as well as such other instruments and agreements as Issuing Bank may customarily require for issuance of a letter of credit of similar type and amount. Issuing Bank shall have no obligation to issue any Letter of Credit unless (i) Issuing Bank receives a LC Request and LC Application at least three Business Days prior to the requested date of issuance from the applicable Borrower (or Borrower Agent on behalf of Singapore Borrower); (ii) each LC Condition is satisfied; and (iii) if a Defaulting Lender exists, such Lender or Borrowers have entered into arrangements satisfactory to Agent and Issuing Bank to eliminate any funding risk associated with the Defaulting Lender. If Issuing Bank receives written notice from a Lender at least five Business Days before issuance of a Letter of Credit that any LC Condition has not been satisfied, Issuing Bank shall have no obligation to issue the requested Letter of Credit (or any other) until such notice is withdrawn in writing by that Lender or until Required Lenders have waived such condition in accordance with this Agreement. Prior to receipt of any such notice, Issuing Bank shall not be deemed to have knowledge of any failure of LC Conditions.

(b) Letters of Credit may be requested by a Borrower only (i) to support obligations of such Borrower incurred in the Ordinary Course of Business; or (ii) for other purposes as Agent and Lenders may approve from time to time in writing. The renewal or extension of any Letter of Credit shall be treated as the issuance of a new Letter of Credit, except that delivery of a new LC Application shall be required at the discretion of Issuing Bank.

(c) Borrowers assume all risks of the acts, omissions or misuses of any Letter of Credit by the beneficiary. In connection with issuance of any Letter of Credit, none of Agent, Issuing Bank or any Lender shall be responsible for the existence, character, quality, quantity, condition, packing, value or delivery of any goods purported to be represented by any Documents; any differences or variation in the character, quality, quantity, condition, packing, value or delivery of any goods from that expressed in any Documents; the form, validity, sufficiency, accuracy, genuineness or legal effect of any Documents or of any endorsements thereon; the time, place, manner or order in which shipment of goods is made; partial or incomplete shipment of, or failure to ship, any goods referred to in a Letter of Credit or Documents; any deviation from instructions, delay, default or fraud by any shipper or other Person in connection with any goods, shipment or delivery; any breach of contract between a shipper or vendor and a Borrower; errors, omissions, interruptions or delays in transmission or

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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delivery of any messages, by mail, cable, telegraph, telex, telecopy, e-mail, telephone or otherwise; errors in interpretation of technical terms; the misapplication by a beneficiary of any Letter of Credit or the proceeds thereof; or any consequences arising from causes beyond the control of Issuing Bank, Agent or any Lender, including any act or omission of a Governmental Authority. The rights and remedies of Issuing Bank under the Loan Documents shall be cumulative. Issuing Bank shall be fully subrogated to the rights and remedies of each beneficiary whose claims against Borrowers are discharged with proceeds of any. Letter of Credit.

(d) In connection with its administration of and enforcement of rights or remedies under any Letters of Credit or LC Documents, Issuing Bank shall be entitled to act, and shall be fully protected in acting, upon any certification, documentation or communication in whatever form believed by Issuing Bank, in good faith, to be genuine and correct and to have been signed, sent or made by a proper Person. Issuing Bank may consult with and employ legal counsel, accountants and other experts to advise it concerning its obligations, rights and remedies, and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by such experts. Issuing Bank may employ agents and attorneys-in-fact in connection with any matter relating to Letters of Credit or LC Documents, and shall not be liable for the negligence or misconduct of agents and attorneys-in-fact selected with reasonable care.

2.2.2. Reimbursement; Participations .

(a) If Issuing Bank honors any request for payment under a Letter of Credit, the applicable Borrower shall pay to Issuing Bank, on the same day (“ Reimbursement Date ”), the amount paid by Issuing Bank under such Letter of Credit, together with interest at the interest rate for U.S. Base Rate Revolver Loans, in the case of the U.S. LC Obligations, and the Singapore Base Rate Revolver Loans, in the case of the Singapore LC Obligations, in each case from the Reimbursement Date until payment by the applicable Borrower. The obligation of each Borrower to reimburse Issuing Bank for any payment made under a Letter of Credit issued on its behalf shall be absolute, unconditional and irrevocable, and shall be paid without regard to any lack of validity or enforceability of any such Letter of Credit or the existence of any claim, setoff, defense or other right that any Borrower may have at any time against the beneficiary. Whether or not a Borrower or Borrower Agent submits a Notice of Borrowing, U.S. Borrower shall be deemed to have requested a Borrowing of U.S. Base Rate Revolver Loans and/or Singapore Borrower shall be deemed to have requested a Borrowing of Singapore Base Rate Revolver Loans, in each case in an amount necessary to pay all amounts due Issuing Bank by such Borrower on the applicable Reimbursement Date and each Lender agrees to fund its Pro Rata share of such Borrowing whether or not the Revolver Commitments

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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have terminated, an Overadvance exists or is created thereby, or the conditions in Section 6 are satisfied.

(b) Upon issuance of a Letter of Credit, each Lender shall be deemed to have irrevocably and unconditionally purchased from Issuing Bank, without recourse or warranty, an undivided Pro Rata interest and participation in all LC Obligations relating to such Letter of Credit. If Issuing Bank makes any payment under a Letter of Credit and the applicable Borrower does not reimburse such payment on the applicable. Reimbursement Date, Agent shall promptly notify Lenders and each Lender shall promptly (within one Business Day) and unconditionally pay to Agent, for the benefit of Issuing Bank, such Lender’s Pro Rata share of such payment. Upon request by a Lender, Issuing Bank shall furnish copies of any Letters of Credit and LC Documents in its possession at such time.

(c) The obligation of each Lender to make payments to Agent for the account of Issuing Bank in connection with Issuing Bank’s payment under a Letter of Credit shall be absolute, unconditional and irrevocable, not subject to any counterclaim, setoff, qualification or exception whatsoever, and shall be made in accordance with this Agreement under all circumstances, irrespective of any lack of validity or unenforceability of any Loan Documents; any draft, certificate or other document presented under a Letter of Credit having been determined to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or the existence of any setoff or defense that any Obligor may have with respect to any Obligations. Issuing Bank does not assume any responsibility for any failure or delay in performance or any breach by any Borrower or other Person of any obligations under any LC Documents. Issuing Bank does not make to Lenders any express or implied warranty, representation or guaranty with respect to the Collateral, LC Documents or any Obligor. Issuing Bank shall not be responsible to any Lender for any recitals, statements, information, representations or warranties contained in, or for the execution, validity, genuineness, effectiveness or enforceability of any LC Documents; the validity, genuineness, enforceability, collectibility, value or sufficiency of any Collateral or the perfection of any Lien therein; or the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Obligor.

(d) No Issuing Bank Indemnitee shall be liable to any Lender or other Person for any action taken or omitted to be taken in connection with any LC Documents except as a result of its actual gross negligence or willful misconduct. Issuing Bank shall not have any liability to any Lender if Issuing Bank refrains from any action under any Letter of Credit or LC Documents until it receives written instructions from Required Lenders.

2.2.3. Cash Collateral . If any LC Obligations, whether or not then due or payable, shall for any reason be outstanding at any time (a) that an Event of Default exists, (b) that Aggregate Availability is less than zero, (c) after the Commitment

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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Termination Date, or (d) within 10 Business Days prior to the Revolver Termination Date, each Borrower shall, at Issuing Bank’s or Agent’s request, Cash Collateralize the stated amount of all its outstanding Letters of Credit and pay to the applicable Issuing Bank the amount of all its other LC Obligations. Each Borrower shall, within five Business Days after demand by the applicable Issuing Bank or Agent from time to time, Cash Collateralize its LC Obligations that relate to any Defaulting Lender. If either Borrower fails to provide any Cash Collateral as required hereunder, Lenders may (and shall upon direction of Agent) advance, as Revolver Loans to such Borrower (which Revolver Loans shall accrue interest at the Base Rate plus (i) the Applicable Margin for U.S. Base Rate Revolver Loans, in the case of U.S. Borrower, or (ii) the Applicable Margin for Singapore Base Rate Loans, in the case of Singapore Borrower), the amount of the Cash Collateral required (whether or not the Commitments have terminated, an Overadvance exists or the conditions in Section 6 are satisfied).

SECTION 3. INTEREST, FEES AND CHARGES

3.1. Interest .

3.1.1. Rates and Payment of Interest .

(a) The Obligations shall bear interest (i) if a U.S. Base Rate Revolver Loan, at the Base Rate in effect from time to time, plus the Applicable Margin for U.S. Base Rate Revolver Loans; (ii) if a LIBOR Revolver Loan, at LIBOR for the applicable Interest Period, plus the Applicable Margin for LIBOR Revolver Loans; (iii) if a Singapore Base Rate Revolver Loan, at the Base Rate in effect from time to time, plus the Applicable Margin for Singapore Base Rate Revolver Loans; (iv) if a SIBOR Revolver Loan, at SIBOR for the applicable Interest Period, plus the Applicable Margin for SIBOR Revolver Loans; (v) if a Singapore Swap Rate Revolver Loan, at the SWAP Rate for the applicable Interest Period, plus the Applicable Margin for Singapore Swap Rate Revolver Loans; (vi) if any other Singapore Obligation (including, to the extent permitted by law, interest not paid when due), at the Base Rate in effect from time to time, plus the Applicable Margin for Singapore Base Rate Revolver Loans; and (vii) if any other U.S. Obligation (including, to the extent permitted by law, interest not paid when due), at the Base Rate in effect from time to time, plus the Applicable Margin for U.S. Base Rate Revolver Loans. Interest shall accrue from the date the Revolver Loan is advanced or the Obligation is incurred or payable, until paid by the applicable Borrower. If a Revolver Loan is repaid on the same day made, one day’s interest shall accrue.

(b) During an Insolvency Proceeding with respect to any Borrower, or during any other Event of Default if Agent or Required Lenders in their discretion so elect, Obligations shall bear interest at the Default Rate (whether before or after any judgment). Each Borrower acknowledges that the cost and expense to Agent and Lenders due to an Event of Default are difficult to ascertain and that the Default Rate is a fair and reasonable estimate to compensate Agent and Lenders for such added cost and expense.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(c) Interest accrued on the Revolver Loans shall be due and payable in arrears, (i) on the first day of each month, in the case of each Base Rate Revolver Loan, and on the last day of each applicable Interest Period, in the case of each Fixed Rate Loan; (ii) on any date of prepayment, with respect to the principal amount of Revolver Loans being prepaid; and (iii) on the Commitment Termination Date. Interest accrued on any other Obligations shall be due and payable as provided in the Loan Documents and, if no payment date is specified, shall be due and payable on demand . Notwithstanding the foregoing, interest accrued at the Default Rate shall be due and payable on demand .

3.1.2. Application to Fixed Rate Loans .

(a) Each Borrower (or Borrower Agent on behalf of Singapore Borrower) may on any Business Day, subject to delivery of a Notice of Conversion/Continuation, elect to convert any portion of its Base Rate Revolver Loans to, or to continue any Fixed Rate Loan at the end of its Interest Period as, a LIBOR Revolver Loan, in the case of U.S. Borrower, or a SIBOR Revolver Loan or a Singapore Swap Rate Revolver Loan, in the case of Singapore Borrower. During any Default or Event of Default, Agent may (and shall at the direction of Required Lenders) declare that no Revolver Loan may be made, converted or continued as a Fixed Rate Loan.

(b) Whenever a Borrower desires to convert or continue Revolver Loans as Fixed Rate Loans, such Borrower (or Borrower Agent on behalf of Singapore Borrower) shall give Agent a Notice of Conversion/Continuation, no later than 11:00 a.m. (Local Time) at least three Business Days before the requested conversion or continuation date. Promptly after receiving any such notice, Agent shall notify each Lender thereof. Each Notice of Conversion/Continuation shall be irrevocable, and shall specify the aggregate principal amount of Revolver Loans to be converted or continued, the conversion or continuation date (which shall be a Business Day), and the duration of the Interest Period (which shall be deemed to be 30 days if not specified). If, upon the expiration of any Interest Period in respect of any Fixed Rate Loans, the applicable Borrower shall have failed to deliver a Notice of Conversion/Continuation, it shall be deemed to have elected to convert (a) such Fixed Rate Loans that are LIBOR Revolver Loans into U.S. Base Rate Revolver Loans, and (b) such Fixed Rate Loans that are SIBOR Revolver Loans or Singapore Swap Rate Revolver Loans into Singapore Base Rate Revolver Loans.

3.1.3. Interest Periods . In connection with the making, conversion or continuation of any Fixed Rate Loan, the applicable Borrower shall select an interest period (“ Interest Period ”) to apply, which interest period shall be 30, 60, or 90 days; provided , however , that:

(a) the Interest Period shall commence on the date the Revolver Loan is made or continued as, or converted into, the applicable Fixed Rate Loan, and shall expire on the numerically corresponding day in the calendar month at its end;

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(b) if any Interest Period commences on a day for which there is no corresponding day in the calendar month at its end or if such corresponding day falls after the last Business Day of such month, then the Interest Period shall expire on the last Business Day of such month; and if any Interest Period would expire on a day that is not a Business Day, the period shall expire on the next Business Day; and

(c) no Interest Period shall extend beyond the Revolver Termination Date.

3.1.4. Interest Rate Not Ascertainable . If Agent shall determine that on any date for determining the interest rate for any Fixed Rate Loan, due to any circumstance affecting the applicable interbank market, adequate and fair means do not exist for ascertaining the applicable interest rates related thereto, then Agent shall immediately notify Borrower Agent of such determination. Until Agent notifies Borrower Agent that such circumstance no longer exists, the obligation of Lenders to make the affected Fixed Rate Loans shall be suspended and no further Revolver Loans may be converted into or continued as such affected Fixed Rate Loans.

3.2. Fees .

3.2.1. Unused Line Fee . Borrowers shall pay to Agent, for the Pro Rata benefit of Lenders, a per annum fee equal to the unused line fee referred to in the definition of Applicable Margin on the amount by which the Revolver Commitments exceed the average daily balance of Revolver Loans and stated amount of Letters of Credit during any month. Such fee shall be payable in arrears, on the first day of each month and on the Commitment Termination Date.

3.2.2. LC Facility Fees . (a) (i) U.S. Borrower shall pay to Agent, for the Pro Rata benefit of Lenders, a fee equal to the Applicable Margin in effect for LIBOR Revolver Loans on the average daily stated amount of U.S. Letters of Credit, and (ii) Singapore Borrower shall pay to Agent, for the benefit of Lenders, a fee equal to the Applicable Margin in effect for SIBOR Revolver Loans on the average daily stated amount of Singapore Letters of Credit, in each case which fees shall be payable monthly in arrears, on the first day of each month; (b) each Borrower shall pay to Agent, for its own account, a fronting fee equal to 0.125% of the stated amount of each Letter of Credit issued on its behalf, which fee shall be payable upon issuance of each Letter of Credit, on each one year anniversary date of the issuance of each Letter of Credit and on the date of any increase in the stated amount of any Letter of Credit made between any such dates; and (c) each. Borrower shall pay to Issuing Bank, for its own account, all customary charges associated with the issuance, amending, negotiating, payment, processing, transfer and administration of each Letter of Credit issued on its behalf, in each case which charges shall be paid as and when incurred. During an Event of Default, the fees payable under this Section 3.2.2 shall be increased by 2% per annum.

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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3.2.3. Closing Fee . U.S. Borrower shall pay to Agent, for the Pro Rata benefit of Lenders, a closing fee of $150,000, which shall be paid concurrently with the funding of the initial Revolver Loans hereunder.

3.2.4. Agent Fees . In consideration of Agent’s syndication of the Revolver Commitments and service as Agent hereunder, U.S. Borrower shall pay to Agent, for its own account, the fees described in the Fee Letter.

3.3. Computation of Interest, Fees, Yield Protection . All interest, as well as fees and other charges calculated on a per annum basis, shall be computed for the actual days elapsed, based on a year of 360 days. Each determination by Agent of any interest, fees or interest rate hereunder shall be final, conclusive and binding for all purposes, absent manifest error. All fees shall be fully earned when due and shall not be subject to rebate, refund or proration. All fees payable under Section 3.2 are compensation for services and are not, and shall not be deemed to be, interest or any other charge for the use, forbearance or detention of money. A certificate as to amounts payable by Borrowers under Section 3.4 , 3.7 , 3.9 or 5.8 , submitted to Borrower Agent by Agent or the affected Lender, as applicable, shall be final, conclusive and binding for all purposes, absent manifest error, and Borrowers shall pay such amounts to the appropriate party within 10 days following receipt of the certificate.

3.4. Reimbursement Obligations . Borrowers shall reimburse Agent for all Extraordinary Expenses. Borrowers shall also reimburse Agent for all reasonable legal, accounting, appraisal, consulting, and other fees, costs and expenses (including, without limitation, reasonable travel expenses) incurred by it in connection with (a) negotiation and preparation of any Loan Documents, including any amendment or other modification thereof; (b) administration of and actions relating to any Collateral, Loan Documents and transactions contemplated thereby, including any actions taken to perfect or maintain priority of Agent’s Liens on any Collateral, to maintain any insurance required hereunder or to verify Collateral; and (c) subject to the limits of Section 10.1.1(b) , each inspection, audit or appraisal with respect to any Obligor or Collateral, whether prepared by Agent’s personnel or a third party. All reasonable legal, accounting and consulting fees shall be charged to Borrowers by Agent’s professionals at their full hourly rates, regardless of any reduced or alternative fee billing arrangements that Agent, any Lender or any of their Affiliates may have with such professionals with respect to this or any other transaction. If, for any reason (including inaccurate reporting on financial statements or a Compliance Certificate), it is determined that a higher Applicable Margin should have applied to a period than was actually applied, then the proper margin shall be applied retroactively and Borrowers shall immediately pay to Agent, for the Pro Rata benefit of Lenders, an amount equal to the difference between the amount of interest and fees that would have accrued using the proper margin and the amount actually paid. All amounts payable by Borrowers under this Section shall be due and payable on demand .

3.5. Illegality . If any Lender determines that any Applicable Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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its applicable Lending Office to make, maintain or fund a Fixed Rate Loan, or to determine or charge interest rates with respect thereto, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the applicable interbank market, then, on notice thereof by such Lender to Agent, any obligation of such Lender to make or continue affected Fixed Rate Loans or to convert U.S. Base Rate Revolver Loans to LIBOR Revolver Loans, or Singapore Base Rate Revolver Loans to SIBOR Revolver Loans or Singapore Swap Rate Revolver Loans shall be suspended until such Lender notifies Agent that the circumstances giving rise to such determination no longer exist. Upon delivery of such notice, Borrowers shall prepay or, if applicable, convert all affected Fixed Rate Loans of such Lender to U.S. Base Rate Revolver Loans, in the case the affected Fixed Rate Loan is a LIBOR Revolver Loan, or to Singapore Base Rate Revolver Loans, in the case the affected Fixed Rate Loan is a SIBOR Revolver Loan or a Singapore Swap Rate Revolver Loan, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain the affected Fixed Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain the affected Fixed Rate Loans. Upon any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted.

3.6. Inability to Determine Rates . If Required Lenders notify Agent for any reason in connection with a request for a Borrowing of, or conversion to or continuation of, a Fixed Rate Loan that (a) Dollar deposits are not being offered to banks in the applicable interbank market for the applicable amount and Interest Period of such affected Fixed Rate Loan, (b) adequate and reasonable means do not exist for determining the interest rate with respect thereto for the requested Interest Period, or (c) the interest rate with respect to an affected Fixed Rate Loan for the requested Interest Period does not adequately and fairly reflect the cost to such Lenders of funding such affected Fixed Rate Loan, then Agent will promptly so notify Borrower Agent and each Lender. Thereafter, the obligation of Lenders to make or maintain such Type of Fixed Rate Loans shall be suspended until Agent (upon instruction by Required Lenders) revokes such notice. Upon receipt of such notice, Borrower Agent may revoke any pending request for a Borrowing of, conversion to or continuation of an affected Fixed Rate Loan or, failing that, will be deemed to have submitted a request for a U.S. Base Rate Revolver Loan, in the case the affected Fixed Rate Loan is a LIBOR Revolver Loan, or a Singapore Base Rate Revolver Loan, in the case the affected Fixed Rate Loan is a SIBOR Revolver Loan or a Singapore Swap Rate Revolver Loan.

3.7. Increased Costs; Capital Adequacy .

3.7.1. Change in Law . If any Change in Law shall:

(a) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in LIBOR, SIBOR or the SWAP Rate, as applicable) or Issuing Bank;

 

Information in this exhibit marked [CONFIDENTIAL TREATMENT REQUESTED] has been omitted and will be filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. Confidential treatment has been requested with respect to the omitted portions.

 

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(b) subject any Lender or Issuing Bank to any Tax with respect to any Revolver Loan, Loan Document, Letter of Credit or participation in LC Obligations, or change the basis of taxation of payments to such Lender or Issuing Bank in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 5.8 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or Issuing Bank); or

(c) impose on any Lender or Issuing Bank or the applicable interbank market any other condition, cost or expense affecting any Revolver Loan, Loan Document, Letter of Credit or participation in LC Obligations; and the result thereof shall be to increase the cost to such Lender of making or maintaining any Fixed Rate Loan (or of maintaining its obligation to make any such Fixed Rate Loan), or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or Issuing Bank, Borrowers will pay to such Lender or Issuing Bank, as applicable, such additional amount