1
EXHIBIT 10.7.1
FIRST AMENDMENT TO THE CREDIT AGREEMENT
FIRST AMENDMENT, dated as of December 31, 1998 (this "First
Amendment"), to the Credit Agreement, dated as of July 23, 1997 (as amended,
supplemented, or otherwise modified from time to time, the "Credit Agreement"),
among GENERAL SEMICONDUCTOR, INC., a Delaware corporation (the "Company"), the
several lenders from time to time parties thereto (the "Banks"), THE CHASE
MANHATTAN BANK, a New York banking corporation, as administrative agent for the
Banks (in such capacity, the "Administrative Agent"), and the financial
institutions named therein as co-agents for the Banks (in such capacity,
collectively, the "Co-Agents"; each, individually, a "Co-Agent").
W I T N E S S E T H:
WHEREAS, the Company, the Banks, the Administrative Agent and
the Co-Agents are parties to the Credit Agreement;
WHEREAS, the Company has requested that the Banks amend the
Credit Agreements as set forth herein;
WHEREAS, the Banks, the Administrative Agent and the Co-Agents
are willing to agree to such amendment to the Credit Agreement, subject to the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein, the Company, the Banks, the Administrative Agent and
the Co-Agents hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein, capitalized
terms which are defined in the Credit Agreement are used herein as therein
defined.
2. Amendments to Credit Agreement. (a) Subsection 1.1 of the
Credit Agreement is hereby amended by deleting clause (b) from the definition of
"Available Revolving Credit Commitments" and substituting therefor the phrase
"(b) the Aggregate Extensions of Credit".
(b) The definitions of "Consolidated EBITDA" in subsection 1.1
of the Credit Agreement is hereby amended (other than for purposes of
calculating the Applicable Margin) by (i) deleting the proviso clause, (ii)
amending the phrase "and (d)" appearing therein to read ", (d)" and (iii)
inserting the following new clause at the end thereof.
and (e) all of the Company's restructuring and other charges
associated with the restructuring of the Company's operations
in an aggregate amount not to exceed $14 million for the
quarter ending December 31, 1998;
(c) Subsection 1.1 of the Credit Agreement is hereby amended
by deleting from the definition of "Consolidated Total Indebtedness" the phrase
", excluding to the extent otherwise included the Taiwan Mortgage Indebtedness"
and deleting the comma after the word "GAAP" and substituting in lieu thereof a
period.
(d) Subsection 1.1 of the Credit Agreement is amended by
deleting the definitions "Taiwan Mortgage Indebtedness" and "Taiwan Mortgaged
Real Property".
2
2
(e) Subsection 5.2 of the Credit Agreement is hereby amended
by deleting from paragraph (e) thereof the phrase ", other than the Taiwan
Mortgage Indebtedness".
(f) Subsection 7.2 of the Credit Agreement is amended by
deleting clause (h) and substituting therefor the phrase "(h) INTENTIONALLY
OMITTED;".
(g) Subsection 7.6 of the Credit Agreement is hereby amended
by deleting from paragraph (c) the amounts "$100,000,000" and "$250,000,000" and
substituting therefor the amounts "$30,000,000" and "$100,000,000",
respectively.
(h) Subsection 7.9 of the Credit Agreement is hereby amended
by deleting such subsection and substituting therefor the following:
7.9 Maintenance of Leverage Ratio. Permit (a) as of the last
day of any fiscal quarter ending on or before March 31, 1999, the
Leverage Ratio to be greater than 4.0 to 1.0, (b) as of the last day of
the fiscal quarter ending June 30, 1999, the Leverage Ratio to be
greater than 3.85 to 1.0 and (c) as of the last day of any fiscal
quarter ending after June 30, 1999, the Leverage Ratio to be greater
than 3.5 to 1.0.
(i) Subsection 7.14 of the Credit Agreement is hereby amended
by deleting clause (b) and substituting therefor the phrase "(b) INTENTIONALLY
OMITTED;".
3. Representations and Warranties. The Company hereby
confirms, reaffirms and restates the representations and warranties set forth in
Section 4 of the Credit Agreement. The Company represents and warrants that,
after giving effect to this First Amendment, no Default or Event of Default has
occurred and is continuing.
4. Effectiveness. Upon receipt of the Administrative Agent of
counterparts of this First Amendment duly executed by the Company and the
Required Banks, this First Amendment shall become effective as of the date (the
"Effective Date") that is the later of (i) the date of receipt by the
Administrative Agent of such counterparts, and (ii) December 31, 1998.
5. Amendment Fee. The Borrower will pay to the Administrative
Agent, for the account of each Lender which executes and returns this First
Amendment to the Administrative Agent on or prior to the Effective Date, an
amendment fee equal to .15% of the Revolving Credit Commitment of such Lender,
such fee to be payable on the Effective Date.
6. Continuing Effect of the Credit Agreement. This First
Amendment shall not constitute an amendment of any other provision of the Credit
Agreement not expressly referred to herein and shall not be construed as a
waiver of consent to any further or future action on the part of the Company
that would require a waiver or consent of the Banks, the Administrative Agent or
the Co-Agents. Except as expressly amended hereby, the provisions of the Credit
Agreement are and shall remain in full force and effect.
7. Counterparts. This First Amendment may be executed by the
parties hereto in any member of separate counterparts (including telecopied
counterparts), each of which shall be deemed to be an original, and all of which
taken together shall be deemed to constitute one and the same instrument.
8. GOVERNING LAW. THIS FIRST AMENDMENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
3
3
IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS FIRST
AMENDMENT TO BE DULY EXECUTED AND DELIVERED IN NEW YORK, NEW YORK BY THEIR
RESPECTIVE PROPER AND DULY AUTHORIZED OFFICERS AS OF THE DAY AND YEAR FIRST
ABOVE WRITTEN.
GENERAL SEMICONDUCTOR, INC.
BY: /S/ XXXXXXX X. XXXXXX
-----------------------------------------
TITLE: VICE PRESIDENT AND TREASURER
THE CHASE MANHATTAN BANK, AS ADMINISTRATIVE
AGENT, AS A CO-AGENT AND AS A BANK
BY: /S/ XXXXXX X. FALKSTEAD
-----------------------------------------
TITLE: VICE PRESIDENT
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, AS A CO-AGENT AND AS A
BANK
BY: /S/
-----------------------------------------
TITLE:
BANK OF MONTREAL, AS A CO-AGENT AND AS A BANK
BY: /S/
-----------------------------------------
TITLE:
THE BANK OF NOVA SCOTIA, AS A CO-AGENT AND AS
A BANK
BY: /S/
-----------------------------------------
TITLE:
4
4
CIBC INC., AS A CO-AGENT AND AS A BANK
BY: /S/
-----------------------------------------
TITLE:
CREDIT LYONNAIS NEW YORK BRANCH, AS A CO-
AGENT AND AS A BANK
BY: /S/
-----------------------------------------
TITLE:
FLEET NATIONAL BANK, AS A CO-AGENT AND AS A
BANK
BY: /S/
-----------------------------------------
TITLE:
WACHOVIA BANK, N.A., AS A CO-AGENT AND AS A
BANK
BY: /S/
-----------------------------------------
TITLE:
THE BANK OF NEW YORK
BY: /S/
-----------------------------------------
TITLE:
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
BY: /S/
-----------------------------------------
TITLE:
5
5
BANKBOSTON, N.A.
BY: /S/
-----------------------------------------
TITLE:
BANQUE NATIONALE DE PARIS
BY: /S/
-----------------------------------------
TITLE:
PARIBAS
BY: /S/
-----------------------------------------
TITLE:
CREDIT AGRICOLE INDOSUEZ
BY: /S/
-----------------------------------------
TITLE:
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
BY: /S/
-----------------------------------------
TITLE:
6
6
THE SANWA BANK LIMITED, CHICAGO BRANCH
BY: /S/
-----------------------------------------
TITLE:
SOCIETE GENERALE, NEW YORK BRANCH
BY: /S/
-----------------------------------------
TITLE:
THE SUMITOMO BANK, LTD., CHICAGO BRANCH
BY: /S/
-----------------------------------------
TITLE:
