AMENDED AND RESTATED ADDENDUM TO SECURITY AGREEMENT: SECURITIES ACCOUNT
EXHIBIT 10.12
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CONFIDENTIAL
TREATMENT REQUESTED
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CONFIDENTIAL
PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY
FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION
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AMENDED
AND RESTATED ADDENDUM TO SECURITY AGREEMENT: SECURITIES ACCOUNT
THIS AMENDED AND RESTATED ADDENDUM,
dated as of May 19, 2008, is attached to and made a part of that certain
Security Agreement: Securities Account executed by SUNPOWER CORPORATION
("Debtor") in favor of XXXXX FARGO BANK, NATIONAL ASSOCIATION ("Bank"), dated as
of April 4, 2008 (the "Agreement") and amends and restates the Addendum to the
Agreement dated as of April 4, 2008.
The following provisions are hereby
incorporated into the Agreement:
1. Securities Account
Activity. So long as no Event of Default exists, Debtor, or
any party authorized by Debtor to act with respect to the Securities Account,
may (a) receive payments of interest and/or cash dividends earned on financial
assets maintained in the Securities Account, (b) subject to the limitation in
the following sentence (and, unless and until Bank sends notice pursuant to
Section 3.3 of the Securities Account Control Agreement dated March 18, 2008,
notwithstanding any provision to the contrary in said Securities Account Control
Agreement), withdraw Collateral, and (c) trade financial assets maintained in
the Securities Account. Without Bank's prior written consent, except
as permitted by the preceding sentence, neither Debtor nor any party other than
Bank may withdraw or receive any distribution of any Collateral from the
Securities Account. The Collateral Value of the Securities Account
shall at all times be equal to or greater than one hundred percent (100%) of the
aggregate amount available to be drawn under outstanding Letters of Credit plus
the amount drawn and not yet reimbursed under Letters of Credit (the “Exposure
Amount”), less the amount then in Debtor’s deposit account * * * (the “Deposit
Account”) at Bank (such result, the “Required Amount”.)
Debtor
understands that Bank will not consider the Collateral Value of the Securities
Account unless and until Debtor has at least $100,000,000.00 in the Deposit
Account. If the $100,000,000.00 Deposit Account balance condition in
the preceding sentence is satisfied and the Collateral Value, for any reason and
at any month end (as reflected in the monthly Securities Account statement
issued by Xxxxx Capital Management Incorporated) is less than the Required
Amount, Debtor shall promptly deposit additional assets of a nature satisfactory
to Bank into the Securities Account or Deposit Account, in either case in
amounts or with values sufficient to achieve the Required Amount. If
the Deposit Account balance is greater than or equal to the Exposure Amount,
Debtor has no obligation to maintain Collateral in the Securities
Account.
2. ”Collateral Value"
means the percentage set forth below of the lower of the face or market value,
or the lower of the face or redemption value, as appropriate, for each type of
investment property held in the Securities Account at the time of computation,
with such value and the classification of any particular investment property in
all instances determined by Bank in its sole discretion, and excluding from such
computation all WF Securities and Collective Investment
Funds. Notwithstanding the foregoing, Bank shall exclude from the
determination of Collateral Value, at Bank's sole discretion (a) any stock with
a market value of $10.00 or less, and (b) all investment property from an issuer
if Bank determines such issuer to be ineligible:
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CONFIDENTIAL MATERIAL REDACTED AND SEPARATELY FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION.
1
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Listed
Money Market (MM)
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95%
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U.S.
Government Bills, Notes and Bonds and U.S. Government sponsored agency
securities with maturities =/< 5 years
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90%
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U.S.
Government Bills, Notes and Bonds and U.S. Government sponsored agency
securities with maturities > 5 years, but =/< 10
years
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85%
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U.S.
Government Bills, Notes and Bonds and U.S. Government sponsored agency
securities with maturities > 10 years
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80%
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High
Grade Corporate or Municipal Bonds/Notes (AAA/Aaa, AA/Aa, SP-1) with
maturities =/< 5 years
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85%
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High
Grade Corporate or Municipal Bonds/Notes (AAA/Aaa, AA/Aa, SP-1) with
maturities > 5 years, but =/< 10 years
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80%
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High
Grade Corporate or Municipal Bonds/Notes (AAA/Aaa, AA/Aa, SP-1) with
maturities > 10 years
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75%
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Intermediate
Grade Corporate or Municipal Bonds/Notes (A, Baa, BBB, SP-2) with
maturities =/< 5 years
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75%
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Intermediate
Grade Corporate or Municipal Bonds/Notes (A, Baa, BBB, SP-2) with
maturities > 5 years, but =/< 10 years
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70%
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Intermediate
Grade Corporate or Municipal Bonds/Notes (A, Baa, BBB, SP-2) with
maturities > 10 years
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65%
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A1
and P1 Graded Commercial Paper
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85%
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MUTUAL
FUNDS:
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Short
Term Corporate Taxable Bond
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90%
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Short
Term Municipal Bond
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90%
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Short
Term U.S. Taxable Bond
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90%
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Intermediate
Term Municipal Bond
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85%
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Intermediate
Term Corporate Taxable Bond
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85%
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Intermediate
U.S. Taxable Bond
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85%
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General
U.S. Taxable Bond
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80%
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Long
Term U.S. Taxable Bond
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80%
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Long
Term Corporate Taxable Bond
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75%
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General
Municipal or Insured All Maturities or Single State Bonds
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75%
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2
3. Exclusion from
Collateral. Notwithstanding anything herein to the contrary,
the terms "Collateral" and "Proceeds" do not include, and Bank disclaims a
security interest in all WF Securities and Collective Investment Funds now or
hereafter maintained in the Securities Account.
4. "Collective Investment
Funds" means collective investment funds as described in 12 CFR 9.18 and
includes, without limitation, common trust funds maintained by Bank for the
exclusive use of its fiduciary clients.
5. "WF Securities" means
stock, securities or obligations of Xxxxx Fargo & Company or of any
affiliate thereof (as the term affiliate is defined in Section 23A of the
Federal Reserve Act (12 USC 371(c), as amended from time to
time).
6. Limitation on
Indebtedness. Notwithstanding anything in this Agreement to
the contrary, the obligations secured hereby are limited to all present and
future Indebtedness of Debtor to Bank arising under or in connection with the
Letter of Credit Line and all Letters of Credit issued thereunder, as such terms
are defined in a Credit Agreement dated as of July 13, 2007 between Bank and
Debtor (as amended, extended or renewed – the “Credit Agreement).
7. Events of
Default. The occurrence of any of the following shall
constitute an "Event of Default" under this Agreement: (a) any defined event of
default, under the Credit Agreement, as defined above; (b) any representation or
warranty made by Debtor herein shall prove to be incorrect, false or misleading
in any material respect when made; (c) Debtor shall fail to observe or perform
any obligation or agreement contained herein; or (d) any impairment of the
rights of Bank in any Collateral or Proceeds, or any attachment or like levy on
any Collateral or Proceeds.
IN WITNESS WHEREOF, this Addendum has
been executed as of the date indicated above.
| SUNPOWER CORPORATION |
XXXXX
FARGO BANK,
NATIONAL ASSOCIATION
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By:
/s/ Xxxxxxxx X.
Xxxxxxxxx
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By:
/s/ Xxxxxxx
Xxxxxxxxx
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Xxxxxxxx
X. Xxxxxxxxx
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Xxxxxxx
Xxxxxxxxx
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Chief
Financial Officer
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Vice
President
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