Exhibit 10.7
AMENDMENT NUMBER TWO TO
CREDIT AGREEMENT
     This Amendment Number Two to Credit Agreement (“Amendment”) is entered into
as of April 30, 2007, by and among WELLS FARGO FOOTHILL, INC., a California
corporation, as Agent (the “Agent”) for the Lenders set forth in the signature
pages hereof (the “Lenders”) and the Lenders, on the one hand, and BOOKHAM,
INC., a Delaware corporation (“Parent”), and each of Parent’s Subsidiaries
identified on the signature pages hereof (such Subsidiaries, together with
Parent, are referred to hereinafter each individually as a “Borrower”, and
individually and collectively, jointly and severally, as the “Borrowers”):
     A. Agent, Lenders and Borrowers have previously entered into that certain
Credit Agreement, dated as of August 2, 2006 (as amended, supplemented, amended
and restated, or otherwise modified, the “Agreement”).
     B. Borrowers, Agent and Lenders desire to amend the Agreement as provided
for and on the conditions herein.
     NOW, THEREFORE, Borrowers, Agent and Lenders hereby amend and supplement
the Agreement as follows:
     DEFINED TERMS. All initially capitalized terms used but not defined in this
Amendment have the meanings assigned to such terms in the Agreement.
     AMENDMENT.
          Section 2.12(a)(ii) of the Agreement, is hereby amended to read as
follows:
               “(ii) the Letter of Credit Usage would exceed $6,000,000, or”
          The introductory paragraph in the definition of Eligible Accounts in
Schedule 1.1 to the Agreement is hereby amended to read as follows:
               “‘Eligible Accounts” means, without duplication, (i) the Eligible
Wuhan Accounts, (ii) the Eligible Marconi Accounts, (iii) the Eligible Siemens
Accounts, (iv) Eligible Alcatel Italia Accounts, and (v) those Accounts created
by a Borrower in the ordinary course of its business, that arise out of its sale
of goods or rendition of services, that comply with each of the representations
and warranties respecting Eligible Accounts made in the Loan Documents, and that
are not excluded as ineligible by virtue of one or more of the excluding
criteria set forth below; provided, however, that such criteria may be revised
from time to time by Agent in Agent’s Permitted Discretion to address the
results of any audit performed by Agent from time to time after the Closing
Date. In determining the amount to be included, Eligible Accounts shall be
calculated net of customer deposits and unapplied cash. Eligible Accounts shall
not include the following:”
          The following definition is hereby added to Schedule 1.1 to the
Agreement in the appropriate alphabetical order:
               “‘Eligible Alcatel Italia Accounts” means Accounts created by a
Borrower owing from Alcatel Italia SPA (“Alcatel Italia”) to Borrowers that
(i) would otherwise constitute Eligible Accounts but for the exclusionary
criteria set forth in parts (a) or (f) of the definition of Eligible Accounts;
(ii) Alcatel Italia has not failed to pay within the earlier of 120 days of
original invoice date or 60 days after the due date; and (iii) do not contain
selling terms of more than 120 days.”

 

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     REPRESENTATIONS AND WARRANTIES. Each Borrower hereby affirms to Agent and
Lenders that all of such Borrower’s representations and warranties set forth in
the Agreement are true, complete and accurate in all material respects as of the
date hereof.
     NO DEFAULTS. Borrowers hereby affirms to the Lender Group that no Event of
Default has occurred and is continuing as of the date hereof.
     CONDITION PRECEDENT. The effectiveness of this Amendment is expressly
conditioned upon receipt by Agent of a fully executed copy of this Amendment.
     COSTS AND EXPENSES. Borrowers shall pay to Agent, in accordance with the
requirements of the Credit Agreement, all of Agent’s out-of-pocket costs and
reasonable expenses (including, without limitation, the fees and expenses of its
counsel, which counsel may include any local counsel deemed necessary, search
fees, filing and recording fees, documentation fees, appraisal fees, travel
expenses, and other fees) arising in connection with the preparation, execution,
and delivery of this Amendment and all related documents.
     LIMITED EFFECT. In the event of a conflict between the terms and provisions
of this Amendment and the terms and provisions of the Agreement, the terms and
provisions of this Amendment shall govern. In all other respects, the Agreement,
as amended and supplemented hereby, shall remain in full force and effect.
     COUNTERPARTS; EFFECTIVENESS. This Amendment may be executed in any number
of counterparts and by different parties on separate counterparts, each of which
when so executed and delivered shall be deemed to be an original. All such
counterparts, taken together, shall constitute but one and the same Amendment.
This Amendment shall become effective upon the execution of a counterpart of
this Amendment by each of the parties hereto.
* * * * *
     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first set forth above.

            WELLS FARGO FOOTHILL, INC.,
a California corporation
      By:           Name:           Title:      

 

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            BOOKHAM, INC.,
a Delaware corporation, as Parent
      By:           Name:   Steve Abely        Title:   Chief Financial Officer 
      BOOKHAM TECHNOLOGY PLC,
a limited liability company incorporated under the laws of
England and Wales, as a Borrower
      By:           Name:   Steve Abely        Title:   Director        NEW
FOCUS, INC.,
a Delaware corporation, as a Borrower
      By:           Name:   Steve Abely        Title:   President        BOOKHAM
(US), INC.,
a Delaware corporation, as a Borrower
      By:           Name:   Steve Abely        Title:   President