Exhibit 10-j-8
FIRST AMENDMENT
FINANCING AGREEMENT
AGREEMENT dated as of November 6, 2002 among Conexant Systems, Inc., a
Delaware corporation ("CONEXANT"), Skyworks Solutions, Inc., a Delaware
corporation formerly known as Alpha Industries, Inc. ("SKYWORKS"), and the
subsidiaries of Skyworks that are parties to the Financing Agreement referred to
below ("SKYWORKS SUBSIDIARIES").
PRELIMINARY STATEMENTS
A. Conexant, Skyworks and the Skyworks Subsidiaries are parties to a Financing
Agreement dated as of June 25, 2002 (the "FINANCING AGREEMENT").
B. Conexant and Skyworks are parties to a Refinancing Agreement dated as of
November 6, 2002 (the "REFINANCING AGREEMENT").
C. The Refinancing Agreement provides for the Financing Agreement to be amended
as set forth in this Agreement.
SECTION 1
DEFINED TERMS; RULES OF CONSTRUCTION
1.1 DEFINED TERMS. In this Agreement, terms defined in the preamble, preliminary
statements or other sections of this Agreement shall have the meanings set forth
therein, and capitalized terms used but not otherwise defined in this Agreement
which are defined in the Refinancing Agreement or the Financing Agreement shall
have the meanings set forth in the Refinancing Agreement or the Financing
Agreement.
1.2 RULES OF CONSTRUCTION. The rules of construction set forth in Exhibit A to
the Financing Agreement shall apply to this Agreement.
SECTION 2
AMENDMENTS
2.1 COMMITMENT REDUCTION. Section 2.1.1.2 of the Financing Agreement is amended
and restated to read in its entirety as follows:
"2.1.1.2 COMMITMENT AMOUNT. The Commitment shall be $50,000,000,
subject to reduction and termination as provided in Section 2.1.1.3
(the "COMMITMENT")."
2.2 ACQUISITION NOTES.
2.2.1 AMENDMENT OF SECTION 2.2. Section 2.2 of the Financing
Agreement is amended and restated to read in its entirety
as follows:
"2.2 INTERIM CONVERTIBLE NOTES. Each of the Interim
Convertible Notes issued pursuant to the Refinancing
Agreement shall be:
2.2.1 an Alpha Note, an Alpha Obligation and a
Note for all purposes of this Agreement;
2.2.2 entitled to the benefit of the
guaranties set forth in Section 3 of
this Agreement; and
2.2.3 an Obligation secured by the security
interest granted in Section 4 of this
Agreement and by each of the other
Security Documents."
2.2.2 REFERENCES TO ACQUISITION NOTES. Each reference in the
Financing Agreement to "Acquisition Notes" shall be deleted.
2.3 MANDATORY PREPAYMENTS OF ACQUISITION NOTES. Sections 2.1.5.4 and
2.1.5.5 of the Financing Agreement are amended and restated to read in
their entirety as follows:
"2.1.5.4 MANDATORY PREPAYMENTS; RELEVANT TRANSACTIONS. In
addition to any other mandatory prepayments or commitment
reductions required pursuant to this Agreement, not later
than one Business Day after Alpha receives any Net Cash
Proceeds from any Relevant Transaction, Alpha shall apply
all of the Net Cash Proceeds of such Relevant Transaction
to prepay Revolving Loans then outstanding (whereupon the
Commitment shall be reduced as provided in Section
2.1.1.3). Notwithstanding the foregoing, Alpha may retain
that portion of the Net Cash Proceeds of such Relevant
Transaction as may be required to assure that the amount of
Available Cash is not less than $60,000,000; provided that
nothing herein shall permit Alpha to retain any amount of
Available Cash in excess of $60,000,000 after the Excess
Cash Payment Date immediately following the receipt of such
Net Cash Proceeds; and provided, that this Section shall
not apply to the proceeds of the sale of Junior Notes which
Skyworks is permitted to retain under Section 3.1 of the
First Amendment."
"2.1.5.5 MANDATORY PREPAYMENTS; EXCESS CASH. In addition
to any other mandatory prepayments or commitment reductions
required pursuant to this Agreement, on each Excess Cash
Payment Date following July 31, 2002, Alpha shall apply an
amount equal to all Excess Cash to
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prepay Revolving Loans then outstanding (whereupon the
Commitment shall be reduced as provided in Section
2.1.1.3); and provided, that this Section shall not apply
to the proceeds of the sale of Junior Notes which Skyworks
is permitted to retain under Section 3.1 of the First
Amendment."
2.4 DEFINED TERMS.
2.4.1 AMENDMENT OF EXHIBIT A. Exhibit A of the Financing Agreement
is amended as follows:
2.4.1.1 Each of the following defined terms is deleted:
2.4.1.1.1 Acquisition Notes
2.4.1.1.2 Eligible Receivables, including Schedule
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2.4.1.1.3 Reserve.
2.4.1.2 The term "Alpha Notes" is amended and restated to
read in its entirety as follows:
"ALPHA NOTES" shall mean the Interim Convertible
Notes.
2.4.1.3 The term "Commitment" is added in the appropriate
alphabetical order and defined as follows:
"COMMITMENT" shall have the meaning set forth in
Section 2.1.1.2.
2.4.1.4 The term "Financing Documents" is amended and
restated to read in its entirety as follows:
"FINANCING DOCUMENTS" shall mean this Agreement,
the First Amendment, the Security Documents, any
Financing Agreement Supplement, the Interim
Convertible Notes, the Revolving Note, the
Mexicali Note, the Closing Certificate, any
Compliance Certificate, and any other document,
instrument or certificate required by this
Agreement or any Security Document to be delivered
to Conexant by or on behalf of any Obligor,
individually and collectively.
2.4.1.5 The term "First Amendment" is added in the
appropriate alphabetical order and defined as
follows:
"FIRST AMENDMENT" shall mean the First Amendment
of Financing Agreement dated as of November 6,
2002.
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2.4.1.6 The term "Interim Convertible Note" is added in
the appropriate alphabetical order and defined as
follows:
"INTERIM CONVERTIBLE NOTES" shall have the meaning
set forth in the Refinancing Agreement.
2.4.1.7 The term "Junior Convertible Notes" is added in
the appropriate alphabetical order and defined as
follows:
"JUNIOR NOTES" shall have the meaning set forth in
the Refinancing Agreement.
2.4.1.8 The term "Notes" is amended and restated to read
in its entirely as follows:
"NOTES" shall mean the Interim Convertible Notes
and the Revolving Note, if issued, individually
and collectively.
2.4.1.9 The term "Refinancing Agreement" is added in the
appropriate alphabetical order and defined as
follows:
"REFINANCING AGREEMENT" shall mean the Refinancing
Agreement dated as of November 6, 2002 by and
among Conexant and Alpha.
2.4.1.10 The term "Senior Convertible Notes" is added in
the appropriate alphabetical order and defined as
follows:
"SENIOR CONVERTIBLE NOTES" shall have the meaning
set forth in the Refinancing Agreement.
2.5 COVENANT AMENDMENTS.
2.5.1 AMENDMENT OF SECTION 7.8. Section 7.8 of the Financing
Agreement is amended by adding, at the end thereof, the
following:
"(h) a sale and leaseback disposition of Skyworks'
facilities located in Woburn, Massachusetts,
Mexicali, Mexico and Newbury Park, California may
be made where:
(1) the consideration received consists
entirely of cash; and
(2) the Net Cash Proceeds of which (x) are
at least equal to 75% of the book value
of such assets, as shown on the
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consolidated balance sheet of Alpha for
the fiscal quarter ended immediately
prior to such sale and leaseback
disposition, and (y) are immediately
applied solely to the prepayment of
Revolving Loans, in accordance with
Section 2.1.5.4, without regard to the
amount of Available Cash at the time of
such prepayment."
"(i) sales, leases, transfers or other dispositions of
assets may be made where:
(i) the Net Cash Proceeds of any single
sale, lease, transfer or other
disposition, or any group of sales,
leases, transfers or other dispositions
which are consummated on the same day,
are immediately applied solely to the
prepayment of Revolving Loans in
accordance with Section 2.1.5.4, without
regard to the amount of Available Cash
at the time of such prepayment, and
after giving effect to such prepayment,
the outstanding principal amount of the
Revolving Loans and the amount of the
Commitment are each less than $20
million."
2.5.2 AMENDMENT OF SECTION 7.9. Section 7.9 of the Financing
Agreement is amended by adding, at the end, the phrase " and
(iii) Liens securing the Senior Convertible Notes."
2.5.3 AMENDMENT OF SECTION 7.12. Section 7.12(a) of the Financing
Agreement is amended as follows:
2.5.2.1 by adding, at the end of clause (i), the phrase ",
including the Interim Convertible Notes" and
2.5.2.2 by adding, at the end of clause (iv), the phrase
", and any Indebtedness of Alpha provided that all
of the Net Cash Proceeds of that Indebtedness are
immediately applied solely to prepay Revolving
Loans in accordance with Section 2.1.5.4, without
regard to the amount of Available Cash at the time
of such prepayment, and after giving effect to
such prepayment, the outstanding principal amount
of the Revolving Loans and the amount of the
Commitment are each less than $20 million" and
2.5.2.3 by adding, at the end of clause (xii), a new
clause (xiii) as follows: "(xiii) Indebtedness
under the Senior Convertible Notes".
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2.5.4 BENEFIT OF GUARANTIES AND SECURITY. A new Section 9.17 is
added to the Financing Agreement and reads in its entirety
as follows:
"9.17 BENEFIT OF GUARANTIES AND SECURITY. Each of the
Interim Convertible Notes and the Senior Convertible Notes,
for so long as they are held by, and, in the case of the
Senior Convertible Notes, registered in the name of,
Conexant, shall be entitled to the benefits of the
Guaranties set forth in Section 3, the Security Interests
set forth in Section 4 and the other Security Documents and
are, for such purposes, Alpha Obligations, until such
benefits are terminated in accordance with the provisions of
this Agreement."
SECTION 3
WAIVERS
3.1 LIMITED WAIVER OF PREPAYMENT. Notwithstanding Section 2.1.5.4 of the
Financing Agreement, Skyworks may retain Net Cash Proceeds from the sale of the
Junior Notes in an aggregate amount equal to (x) $40,000,000 (or such lesser
amount equal to the Net Cash Proceeds from the sale of Junior Notes retained by
Skyworks after giving effect to the payments required to be made pursuant to
Section 2.1 of the Refinancing Agreement), plus (y) if (and only if) Net Cash
Proceeds from the sale of the Junior Notes exceed $160,000,000 an amount equal
to one half of the amount by which such Net Cash Proceeds exceed $160,000,000;
provided that all other Net Cash Proceeds are applied as provided in Section 2.1
of the Refinancing Agreement.
3.2 MEXICALI EQUIPMENT. The existing Default under the Financing Agreement
arising from the transfer of Equipment to the Mexicali facility from United
States locations, as described in the letter dated October 30, 2002 addressed to
Xxxx Xxxx from Xxxx X. Xxxxxxx, is waived.
SECTION 4
REPRESENTATIONS AND WARRANTIES
4.1 REFINANCING AGREEMENT. Each of the representations and warranties set forth
in Section 5.2 of the Refinancing Agreement is true and correct as of the date
hereof and is made by each of the Obligors, jointly and severally, as of the
date hereof as if set forth verbatim in this Agreement.
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SECTION 5
CONDITIONS PRECEDENT
5.1 CONDITIONS TO EFFECTIVENESS. This Agreement shall become effective on the
date that each of the following conditions shall have been satisfied (or waived
in accordance with Section 6.7):
5.1.1 This Agreement shall have been signed by each of the parties
hereto.
5.1.2 Skyworks shall have received proceeds (without giving effect
to any discounts or commissions required to be paid) of not
less that $160 million pursuant to the sale of the Junior
Notes on the terms and conditions set forth in the Junior
Note Documentation.
5.1.3 Skyworks shall have performed and complied with all of its
covenants and agreements in the Refinancing Agreement
required to be performed by Skyworks on or prior to the date
that the conditions in Sections 5.1.1 and 5.1.2 have first
been satisfied.
5.2 EFFECTIVENESS. Subject to Section 5.1, the provisions of this Agreement
shall become effective as follows:
5.2.1 Section 3.1 shall become effective immediately upon
satisfaction of the conditions precedent in Section 5.1.
5.2.2 Section 2 and the other provisions of this Agreement shall
become effective only when the following additional
conditions have been satisfied:
5.2.2.1 All Net Cash Proceeds from the sale of the Junior
Notes, other than the amounts Skyworks is
expressly permitted to retain pursuant to Section
3.1 of this Agreement, have been applied to the
prepayment or repayment of principal of
Acquisition Notes and Revolving Loans as provided
in Section 2.1.5.4 of the Financing Agreement,
prior to giving effect to Section 2 of this
Agreement, and such prepayments or repayments of
principal shall not be less than the amounts
provided in Sections 2.1.1 and 2.1.2 of the
Refinancing Agreement.
5.2.2.2 Skyworks shall have authorized, executed, issued
and delivered to Conexant Interim Convertible
Notes, dated the date hereof, in an aggregate
principal amount equal to the aggregate principal
amount of Acquisition Notes outstanding after
giving effect to the prepayments required by
Section 5.2.2.1 of this Agreement and Section 2.1
of the Refinancing Agreement.
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SECTION 6
MISCELLANEOUS
6.1 NO WAIVER. The execution and delivery by Conexant of this Agreement shall
not be deemed (i) to create a course of dealing or otherwise obligate Conexant
to forbear or execute similar amendments or waivers under the same or similar
circumstances in the future, or (ii) to amend, relinquish or impair any right of
Conexant to receive any indemnity or similar payment from any Person or entity
as a result of any matter arising from or relating to this Agreement.
6.2 EFFECT ON FINANCING AGREEMENT. Except as herein modified or waived, all
terms, covenants and provisions of the Financing Agreement are and shall remain
in full force and effect and all references therein or in any other Financing
Documents to the Financing Agreement shall henceforth refer to the Financing
Agreement as modified by this Agreement. This Agreement shall be deemed
incorporated into, and a part of, the Financing Agreement.
6.3 BINDING AGREEMENT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. No
third party beneficiaries are intended in connection with this Agreement.
6.4 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of New York.
6.5 COUNTERPARTS. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all such counterparts together
shall constitute but one and the same instrument. Each of the parties hereto
understands and agrees that this document (and any other document required
herein) may be delivered by any party thereto either in the form of an executed
original or an executed original sent by facsimile transmission to be followed
promptly by mailing of a hard copy original, and that receipt by Conexant of a
facsimile transmitted document purportedly bearing the signature of any Obligor
shall bind such Obligor, with the same force and effect as the delivery of a
hard copy original. Any failure by Conexant to receive the hard copy executed
original shall not diminish the binding effect of receipt of the facsimile
transmitted copy of such document of the party whose hard copy page was not
received by Conexant.
6.6 ENTIRE AGREEMENT. This Agreement, together with the Refinancing Agreement,
the Financing Agreement and the other Financing Documents, and the Refinancing
Documents contain the entire and exclusive agreement of the parties hereto with
reference to the matters discussed herein and therein. This Agreement supersedes
all prior drafts and communications with respect thereto.
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6.7 AMENDMENTS AND WAIVERS. This Agreement may not be amended, modified or
waived except in accordance with the provisions of Section 9.2 of the Financing
Agreement.
6.8 SEVERABILITY. If any term or provision of this Agreement shall be deemed
prohibited by or invalid under any applicable law, such provision shall be
invalidated without affecting the remaining provisions of this Agreement or any
of the Financing Documents.
6.9 SECURITY AND GUARANTIES CONFIRMED AND EXTENDED. Each Obligor confirms that
the Security Documents secure the Interim Convertible Notes and the Senior
Convertible Notes (for so long as they are held by and, in the case of the
Senior Convertible Notes, registered in the name of, Conexant) and all
Obligations under the Financing Agreement as modified by this Agreement. Each
Guarantor confirms that the benefit of such Guarantor's Guaranty applies to the
Interim Convertible Notes and the Senior Convertible Notes (for so long as they
are held by and, in the case of the Senior Convertible Notes, registered in the
name of, Conexant) and all Obligations under the Financing Agreement as modified
by this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date first
above written.
CONEXANT SYSTEMS, INC.
By: /s/ Balakrishnan X. Xxxx
--------------------------------------
Name: Balakrishnan X. Xxxx
Title: Senior Vice President and
Chief Financial Officer
SKYWORKS SOLUTIONS, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
ALPHA INDUSTRIES LIMITED,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
ALPHA SECURITIES CORPORATION,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
TRANSTECH, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
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AIMTA, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
CFP HOLDING COMPANY, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
4067959 CANADA, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
CONEXANT SYSTEMS, S.A. de C.V.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
LEADERCO JAPAN KK,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
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LEADERCO WORLDWIDE, INC.,
as an Obligor
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxx
Title:
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