exv4w2



 





Exhibit 4.2




CHIPPAC, INC., as Company




ST ASSEMBLY TEST SERVICES LTD, as Parent




and




U.S. BANK NATIONAL ASSOCIATION, as Trustee




FIRST SUPPLEMENTAL INDENTURE




TO THE INDENTURE DATED AS OF MAY 28, 2003




Dated as of August 4, 2004




2.50% Convertible Subordinated Securities Due 2008




 









 








     FIRST SUPPLEMENTAL INDENTURE (this “First Supplemental Indenture”), dated
as of August 4, 2004, between ChipPAC, Inc., a corporation duly organized and
existing under the laws of the State of Delaware (the “Company”), ST Assembly
Test Services Ltd, a Singapore public company limited by shares (the “Parent”)
and U.S. Bank National Association, a banking association duly organized and
existing under the laws of the United States of America, as trustee (the
“Trustee”).



RECITALS




     WHEREAS, the Company and the Trustee have heretofore executed an Indenture
(the “Base Indenture” and as amended hereby, the “Indenture”) dated as of May
28, 2003, pursuant to which the Company issued $150,000,000 aggregate principal
amount of 2.50% Convertible Subordinated Securities due 2008 (the
“Securities”);



     WHEREAS, the Company has entered into the Agreement and Plan of Merger and
Reorganization dated as of February 10, 2004 (the “Merger Agreement”) by and
among Parent, Camelot Merger, Inc., a Delaware corporation and a wholly owned
subsidiary of Parent (“Acquisition Corp”), and the Company, pursuant to which
Acquisition Corp will merge (the “Merger”) with and into the Company, with the
Company continuing as the surviving corporation of the Merger, and each share
of the Company’s Class A common stock, $0.01 par value per share immediately
prior to the effective time (“Effective Time”) of the Merger will be converted
into the right to receive 0.87 ADSs (as defined below);



     WHEREAS, Section 5.11 of the Base Indenture requires the Company to enter
into a supplemental indenture as a condition precedent to the Merger to provide
that the Securities be convertible into ADSs. Pursuant to Section 5.11 of the
Base Indenture, Parent is also required to execute this First Supplemental
Indenture to agree to be bound by the provisions relating to the conversion of
the Securities into ADSs;



     WHEREAS, the Company and Parent desire to amend the Base Indenture to
provide that the Securities are convertible into ADSs in accordance with
Section 5.11 of the Base Indenture;



     WHEREAS, all conditions and requirements necessary to make this First
Supplemental Indenture a valid, binding and legal instrument in accordance with
the terms of the Indenture have been performed and fulfilled and the execution
and delivery hereof by the Company and Parent have been in all respects duly
authorized;



     NOW, THEREFORE, for and in consideration of the above premises, it is
hereby covenanted and agreed, for the equal and proportionate benefit of the
Holders of the Securities, as follows:



 









 




ARTICLE 1




RELATION TO BASE INDENTURE, DEFINITIONS




     Section 1.01 Relation to Base Indenture. This First Supplemental
Indenture constitutes an integral part of the Indenture. In the event of
inconsistencies between the Base Indenture and this First Supplemental
Indenture, the terms of this First Supplemental Indenture shall govern.



     Section 1.02 Definitions. For all purposes of this First Supplemental
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:



     (a) capitalized terms used herein without definition have the meanings
specified in the Indenture;



     (b) all other terms used herein without definition which are defined in
the TIA, either directly or by reference therein, have the meanings assigned to
them therein; and



     (c) unless the context otherwise requires, any reference to an “Article”
or a “Section” refers to an Article or a Section, as the case may be, of this
First Supplemental Indenture.



     Section 1.03 Amendment to Definitions in Indenture. The following
definitions are hereby added to Section 1.01 of the Indenture in its
alphabetical location:



     “ADRs” means American depositary receipts which evidence ADSs.



     “ADSs” means the American depositary shares issued pursuant to the Deposit
Agreement, each of which represents the right to receive ten Ordinary Shares.



     “ADS Depositary” means Citibank, N.A., as depositary, appointed pursuant
to the Deposit Agreement or such other depositary appointed by Parent with
respect to the ADSs from time to time.



     “Deposit Agreement” means the Deposit Agreement, dated as of February 8,
2000, by and among Parent, the ADS Depositary, and all holders and beneficial
owners from time to time of the ADSs evidenced by ADRs issued thereunder, as
the same may be amended and/or supplemented from time to time in accordance
with its terms.



     “Ordinary Shares” includes any stock of any class of Parent which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of Parent and
which is not subject to redemption by Parent. However, subject to the
provisions of Section 5.11 of the Indenture,
ADSs issuable on conversion of the Securities shall represent only shares
of the class designated as Ordinary Shares of Parent at the date of this First
Supplemental Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or



2









 





involuntary liquidation, dissolution or winding-up of Parent (except for any
right the record date for which precedes the Conversion Date for such
Securities; with respect to preemptive rights in connection with rights issues
and rights to dividends, except in the case where the record date for closure
of Parent’s register of shareholders for a shareholders’ meeting precedes such
Conversion Date; and except for any other right excluded by mandatory
provisions of applicable law) and which are not subject to redemption by
Parent; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares
of all such classes resulting from all such reclassifications.




     The definition of “Common Stock” is hereby deleted in its entirety. Other
than the provisions that have been specifically amended in this First
Supplemental Indenture, in each instance in the Indenture where there is a
reference to “Common Stock” or “the Company’s Common Stock”, such terms shall
be replaced by “ADSs” or “Parent’s ADSs”.



     The following definitions in Section 1.01 of the Indenture are hereby
replaced in their entirety as follows:



     “Board of Directors” means the Board of Directors of the Company except
where the context specifies “Board of Directors of Parent”, in which case, it
means the Board of Directors of Parent, and in both cases, include any
committee thereof duly authorized to act on behalf of such Board.



     “Officer” means, with respect to Parent or the Company, as the case may
be, the Chief Executive Officer, the Chief Financial Officer, the President,
any Vice President, the Treasurer, the Corporate Controller or the Secretary of
Parent or the Company.



     “Officer’s Certificate” means a certificate signed by an Officer of the
Company, except where the context specifies “Officer’s Certificate of Parent”,
in which case, it means an Officer’s Certificate signed by an Officer of
Parent.



     “Opinion of Counsel” means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to
Parent, the Company or the Trustee.



     The following definition in Section 4.07 of the Indenture is hereby
replaced in its entirety as follows:



     A “Change of Control” shall be deemed to have occurred if any of the
following occurs after the date hereof:



     (1) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than Parent, is or becomes the “beneficial owner” (as
defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of
a majority in the aggregate of the total voting power of the Voting Stock of
the Company or has the power, directly or indirectly, to elect a majority of
the members of the Board of Directors of the Company (for the purposes of this
clause (1), such person shall be deemed to (A) beneficially



3









 





own any Voting
Stock of a person (the “specified person”) held by any other person (the
“parent entity”) so long as such person beneficially owns (as so defined),
directly or indirectly, in the aggregate a majority of the voting power of the
Voting Stock of the parent entity and (B) have “beneficial ownership” of all
shares that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time);




     (2) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), is or becomes the “beneficial owner” (as defined in Rules 13d-3
and 13d-5 under the Exchange Act), directly or indirectly, of a majority in the
aggregate of the total voting power of the Voting Stock of Parent or has the
power, directly or indirectly, to elect a majority of the members of the Board
of Directors of Parent (for the purposes of this clause (2), such person shall
be deemed to (A) beneficially own any Voting Stock of a person (the “specified
person”) held by any other person (the “parent entity”) so long as such person
beneficially owns (as so defined), directly or indirectly, in the aggregate a
majority of the voting power of the Voting Stock of the parent entity and (B)
have “beneficial ownership” of all shares that any such person has the right to
acquire, whether such right is exercisable immediately or only after the
passage of time);



     (3) the merger or consolidation of the Company with or into another Person
or the merger of another Person with or into the Company, or the sale of all or
substantially all the assets of the Company and its Subsidiaries (determined on
a consolidated basis) to another Person other than a transaction following
which Holders of securities that represented 100% of the Voting Stock of the
Company or Parent, as the case may be, immediately prior to such transaction
(or other securities into which such securities are converted as part of such
merger or consolidation transaction) own, directly or indirectly, at least a
majority of the voting power of the Voting Stock of the surviving Person;



     (4) the merger or consolidation of Parent with or into another Person or
the merger of another Person with or into Parent, or the sale of all or
substantially all the assets of Parent (determined on a consolidated basis) to
another Person other than a transaction following which Holders of securities
that represented 100% of the Voting Stock of Parent, as the case may be,
immediately prior to such transaction (or other securities into which such
securities are converted as part of such merger or consolidation transaction)
own, directly or indirectly, at least a majority of the voting power of the
Voting Stock of the surviving Person; or



     (5) the adoption of a plan relating to the liquidation or dissolution of
the Company or Parent.



     Notwithstanding anything to the contrary set forth in this Section 4.07, a
Change of Control will not be deemed to have occurred if either:



     (a) the ADS Closing Price (as defined in Section 5.06(f)) for any five
Trading Days during the ten Trading Days immediately preceding the Change of
Control is at least equal to 105% of the Conversion Price in effect immediately
preceding the Change of Control; or



     (b) 100% of the consideration (excluding cash payments for fractional
shares) received or to be received by the holders of shares of the Company’s
common stock or Parent’s



4









 





Ordinary Shares in the transaction or transactions
constituting a Change of Control consists of shares of common stock, or
American depositary shares representing shares of common stock, that are, or
upon issuance will be, traded on a national securities exchange in the United
States or though the Nasdaq National Market and as a result of such transaction
or transactions the Securities become convertible solely into such common stock
or American depositary shares.




ARTICLE 2




AMENDMENT TO FORM OF SECURITY




     Section 2.01 Form of Security. Exhibit A of the Indenture is replaced in
its entirety in the form attached to this First Supplemental Indenture. Upon
the execution of this First Supplemental Indenture, the Company shall execute
and the Trustee shall authenticate and deliver, Securities in the form set
forth in Exhibit A, in substitution for Securities then outstanding and all
Securities presented or delivered to the Trustee on and after the Effective
Time shall be in the form of Exhibit A attached hereto to give effect to the
First Supplemental Indenture.



     Nothing contained in this First Supplemental Indenture shall require the
Holder of any Security to submit or exchange such Security prior to the
Effective Time. The Trustee shall not at any time be under any responsibility
to acquire or cause any Security now or hereafter outstanding to be presented
or delivered to it for any purposes provided for in this Section 2.01.



ARTICLE 3




AMENDMENT TO CONVERSION PROVISIONS




     Article 5 of the Indenture is hereby replaced in its entirety as follows:



     Section 5.01 “Conversion Privilege. Subject to the further provisions of
this Article 5, a Holder of a Security may, at the Holder’s option, convert the
principal amount of such Security (or any portion thereof equal to $1,000 or
any integral multiple of $1,000 in excess thereof) into ADSs at any time prior
to the close of business on the Business Day immediately preceding June 1,
2008, at the Conversion Price then in effect; provided, however, that if such
Security is submitted or presented for purchase pursuant to Article 4 of this
Indenture, such conversion right shall terminate at the close of business on
the Business Day immediately preceding the Change of Control Purchase Date for
such Security or such earlier date as the Holder presents such Security for
purchase (unless the Company shall default in making the Change of Control
Purchase Price payment when due, in
which case the conversion right shall terminate at the close of business
on the date such default is cured and such Security is purchased). The number
of ADSs issuable upon conversion of a Security shall be determined by dividing
the principal amount of the Security or portion thereof surrendered for
conversion by the Conversion Price in effect on the Conversion Date. The
Conversion Price as of the date hereof is $9.267 and is subject to adjustment
as provided in this Article 5.



5









 





     Provisions of this Indenture that apply to conversion of all of a Security
also apply to conversion of a portion of a Security.



     A Security in respect of which a Holder has delivered a Change of Control
Purchase Notice pursuant to Section 4.07(c) of the Indenture exercising the
option of such Holder to require the Company to purchase such Security may be
converted only if such Change of Control Purchase Notice is withdrawn by a
written notice of withdrawal delivered to a Paying Agent prior to the close of
business on the Business Day immediately preceding the Change of Control
Purchase Date in accordance with Section 4.08 of this Indenture.



     A Holder of Securities is not entitled to any rights of a holder of ADSs
until such Holder has converted its Securities into ADSs, and only to the
extent such Securities are deemed to have been converted into ADSs pursuant to
this Article.



     The ADSs, when issued, shall be subject to the terms of the Deposit
Agreement.



     Section 5.02 Conversion Procedure. To convert a Security, a Holder must
(a) complete Part I of and manually sign the conversion notice on the back of
the Security (the “Conversion Notice”) and deliver such notice to a Conversion
Agent, (b) surrender the Security to a Conversion Agent, (c) furnish
appropriate endorsements and transfer documents if required by a Registrar or a
Conversion Agent and (d) pay any transfer or similar tax, if required. The
date on which the Holder satisfies all of those requirements is the “Conversion
Date”. As soon as practicable after the Conversion Date, Parent shall deliver
to the Holder through a Conversion Agent the number of ADSs issuable upon the
conversion and cash in lieu of any fractional ADSs pursuant to Section 5.03.
Anything herein to the contrary notwithstanding, in the case of Global
Securities, conversion notices may be delivered and such Securities may be
surrendered for conversion in accordance with Applicable Procedures as in
effect from time to time.



     The Conversion Agent shall use commercially reasonable efforts to procure
the completion of Part II of the Conversion Notice by the Holder who converts a
Security. The Conversion Agent shall promptly, but in no event later than two
Business Days following the Conversion Date, deliver a copy of such duly
completed Conversion Notice to the ADS Depositary, the Custodian (as defined in
the Deposit Agreement), the Company and counsel to the Company.



     As soon as practicable after the Conversion Date, Parent shall, on behalf
of such Holder, deliver to and deposit with the ADS Depositary or its
custodian, in accordance with the applicable terms and conditions of the
Deposit Agreement, such number of Ordinary Shares represented by the number of
ADSs such Holder will receive upon conversion, based on the
applicable Ordinary Share-to-ADS ratio then in effect. Such Ordinary
Shares will be registered in the name of the ADS Depositary or its nominee.
Subject to compliance with the terms of the Deposit Agreement, the ADS
Depositary will issue such number of ADSs representing the deposited Ordinary
Shares to such Holder.



     The ADS Depositary or its nominee shall be deemed to be the registered
holder of the Ordinary Shares represented by the ADSs issued upon conversion on
the date it is registered as such in Parent’s share register. Upon conversion
of a Security, a Holder shall no longer be



6









 





considered a Holder of such
Security. No payment or adjustment will be made for dividends or distributions
on Ordinary Shares issued upon conversion of a Security.




     Securities so surrendered for conversion (in whole or in part) during the
period from the close of business on any regular record date to the opening of
business on the next succeeding interest payment date (excluding Securities or
portions thereof which are subject to purchase following a Change of Control on
a date during the period beginning at the close of business on a regular record
date and ending at the opening of business on the first Business Day after the
next succeeding interest payment date, or if such interest payment date is not
a Business Day, the second such Business Day) shall also be accompanied by
payment in funds acceptable to the Company in an amount equal to the interest
payable on such interest payment date on the principal amount of such Security
then being converted, and such interest shall be payable to such registered
Holder notwithstanding the conversion of such Security, subject to the
provisions of this Indenture relating to the payment of defaulted interest by
the Company. Except as otherwise provided in this Section 5.02, no payment or
adjustment will be made for accrued interest on a converted Security. If the
Company defaults in the payment of interest payable on such interest payment
date, the Company shall promptly repay such funds to such Holder.



     Nothing in this Section shall affect the right of a Holder in whose name
any Security is registered at the close of business on a record date to receive
the interest payable on such Security on the related interest payment date in
accordance with the terms of this Indenture and the Securities. If a Holder
converts more than one Security at the same time, the number of ADSs issuable
upon the conversion shall be based on the aggregate principal amount of
Securities converted.



     Upon surrender of a Security that is converted in part, the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder, a new
Security equal in principal amount to the unconverted portion of the Security
surrendered.



     Section 5.03 Fractional Shares. The ADS Depositary will not issue
fractional ADSs upon conversion of Securities. In lieu thereof, Parent will
pay an amount in cash based upon the ADS Closing Price on the Trading Day
immediately prior to the Conversion Date.



     Section 5.04 Taxes on Conversion. If a Holder converts a Security, the
Company shall pay any documentary, stamp or similar issue or transfer tax due
on the issue of ADSs upon such conversion. However, the Holder shall pay any
such tax which is due because the Holder requests the ADSs to be issued in
a name other than the Holder’s name. The Conversion Agent may refuse to
deliver the ADSs being issued in a name other than the Holder’s name until the
Conversion Agent receives a sum sufficient to pay any tax which will be due
because the ADSs are to be issued in a name other than the Holder’s name.
Nothing herein shall preclude any tax withholding required by law or
regulation.



     Section 5.05 Parent To Provide Ordinary Shares. Parent shall from time
to time as may be necessary, reserve, out of its authorized but unissued
Ordinary Shares, a sufficient number of Ordinary Shares to permit the
conversion of all outstanding Securities into ADSs.



7









 





     All ADSs delivered upon conversion of the Securities and all of the
Ordinary Shares represented by such ADSs shall be newly issued securities, and
such Ordinary Shares shall be duly authorized, validly issued, fully paid and
nonassessable and shall be free from preemptive (and similar) rights, free of
any lien, encumbrance, security interest, charge, mortgage or adverse claim and
shall rank fully pari passu, including with regards to trading and settlement,
with all other Ordinary Shares outstanding at the time of deposit with the ADS
Depositary.



     Parent will endeavor promptly to comply with all federal and state
securities laws regulating the offer and delivery of ADSs upon conversion of
Securities, if any, and will list or cause to have quoted such ADSs on a
national securities exchange or on the Nasdaq National Market or other
over-the-counter market or such other market on which the ADSs are then listed
or quoted; provided, however, that if rules of such automated quotation system
or exchange permit Parent to defer the listing of such ADSs until the first
conversion of the Securities into ADSs in accordance with the provisions of
this Indenture, Parent covenants to list such ADSs issuable upon conversion of
the Securities in accordance with the requirements of such automated quotation
system or exchange at such time.



     Section 5.06 Adjustment of Conversion Price. The conversion price as
stated in Section 5.01 (the “Conversion Price”) shall be adjusted from time to
time by Parent as follows:



     (a) In case Parent shall (i) pay a dividend on its Ordinary Shares in the
form of Ordinary Shares, (ii) make a distribution on its Ordinary Shares in the
form of Ordinary Shares, (iii) subdivide its outstanding Ordinary Shares into a
greater number of Ordinary Shares, or (iv) combine its outstanding Ordinary
Shares into a smaller number of Ordinary Shares, the Conversion Price in effect
immediately prior thereto shall be adjusted so that, assuming the same Ordinary
Share-to-ADS ratio applies prior to and after such event, the Holder of any
Security thereafter surrendered for conversion shall be entitled to receive the
number of ADSs which it would have owned had such Security been converted
immediately prior to the happening of such event. An adjustment made pursuant
to this subsection (a) shall become effective immediately after the record date
in the case of a dividend or distribution and shall become effective
immediately after the effective date in the case of subdivision or combination.



     (b) In case Parent shall issue rights or warrants to all or substantially
all holders of its Ordinary Shares entitling them (for a period commencing no
earlier than the record date described below and expiring not more than 60 days
after such record date) to subscribe for or purchase Ordinary Shares (or
securities convertible into Ordinary Shares) at a price per share (or having a
conversion price per share) less than the Current Market Price Per Ordinary
Share (as defined in Section 5.06(g)) on the record date for the determination
of shareholders entitled to receive such rights or warrants, the Conversion
Price in effect immediately prior thereto shall be adjusted so that the same
shall equal the price determined by multiplying the Conversion Price in effect
immediately prior to such record date by a fraction of which (x) the numerator
shall be the number of Ordinary Shares outstanding on such record date plus the
number of Ordinary Shares which the aggregate offering price of the total
number of Ordinary Shares so offered (or the aggregate conversion price of the
convertible securities so offered, which shall be determined by multiplying the
number of Ordinary Shares issuable upon conversion of such convertible
securities by the conversion price per Ordinary Share pursuant to the terms of
such convertible



8









 





securities) would purchase at the Current Market Price Per
Ordinary Share on such record date, and (y) the denominator shall be the number
of Ordinary Shares outstanding on such record date plus the number of
additional Ordinary Shares offered (or into which the convertible securities so
offered are convertible). Such adjustment shall be made successively whenever
any such rights or warrants are issued, and shall become effective immediately
after such record date. If at the end of the period during which such rights
or warrants are exercisable not all rights or warrants shall have been
exercised, the adjusted Conversion Price shall be immediately readjusted to
what it would have been based upon the number of additional Ordinary Shares
actually issued (or the number of Ordinary Shares issuable upon conversion of
convertible securities actually issued).




     (c) In case Parent shall distribute to all or substantially all holders of
its Ordinary Shares any shares of capital stock of Parent (other than in the
form of Ordinary Shares), evidences of indebtedness or other non-cash assets
(including securities of any person other than Parent but excluding (1)
dividends or distributions paid in cash or (2) dividends or distributions
referred to in subsection (a) of this Section 5.06), or shall distribute to all
or substantially all holders of its Ordinary Shares rights or warrants to
subscribe for or purchase any of its securities (excluding those rights and
warrants referred to in subsection (b) of this Section 5.06 and also excluding
the distribution of rights to all holders of Ordinary Shares pursuant to the
adoption of a stockholders’ rights plan, if any), then in each such case the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the current Conversion Price by a fraction of which
(x) the numerator shall be the Current Market Price Per Ordinary Share on the
record date mentioned below less the fair market value on such record date (as
reasonably determined in good faith by the Board of Directors of Parent, whose
determination shall be conclusive evidence of such fair market value and which
shall be evidenced by an Officers’ Certificate of Parent delivered to the
Trustee) of the portion of the capital stock, evidences of indebtedness or
other non-cash assets so distributed or of such rights or warrants applicable
to one Ordinary Share (determined on the basis of the number of Ordinary Shares
outstanding on the record date), and (y) the denominator shall be the Current
Market Price Per Ordinary Share on such record date. Such adjustment shall be
made successively whenever any such distribution is made and shall become
effective immediately after the record date for the determination of
shareholders entitled to receive such distribution.



     (d) In case Parent shall, by dividend or otherwise, at any time distribute
(a “Triggering Distribution”) to all or substantially all holders of its
Ordinary Shares cash in an aggregate amount that, together with the aggregate
amount of (i) any cash and the fair market value (as reasonably determined in
good faith by the Board of Directors of Parent, whose determination shall be
conclusive evidence of such fair market value and which shall be evidenced by
an Officers’ Certificate of Parent delivered to the Trustee) of any other
consideration payable in respect of any purchase by Parent for Ordinary Shares
consummated within the 12 months preceding the date of payment of the
Triggering Distribution and in respect of which no Conversion Price adjustment
pursuant to this Section 5.06 has been made and (ii) all other cash
distributions to all or substantially all holders of its Ordinary Shares made
within the 12 months preceding the date of payment of the Triggering
Distribution and in respect of which no Conversion Price adjustment pursuant to
this Section 5.06 has been made, exceeds an amount equal to 10.0% of the
product of the Current Market Price Per Ordinary Share on the Business Day
immediately preceding the day on which such Triggering Distribution is declared
by Parent (the “Determination Date”) multiplied by the number of Ordinary
Shares outstanding on the



9









 





Determination Date, the Conversion Price shall be
reduced so that the same shall equal the price determined by multiplying such
Conversion Price in effect immediately prior to the Determination Date by a
fraction, of which the numerator shall be the Current Market Price Per Ordinary
Share on the Determination Date less the sum of the aggregate amount of cash
and the aggregate fair market value (as reasonably determined in good faith by
the Board of Directors of Parent, whose determination shall be conclusive
evidence of such fair market value and which shall be evidenced by an Officers’
Certificate of Parent delivered to the Trustee) of any such other consideration
so distributed, paid or payable within such 12 months (including, without
limitation, the Triggering Distribution) applicable to one Ordinary Share
(determined on the basis of the number of Ordinary Shares outstanding on the
Determination Date) and the denominator shall be such Current Market Price Per
Ordinary Share on the Determination Date, such reduction to become effective
immediately prior to the opening of business on the day following the date on
which the Triggering Distribution is paid.




     (e) In case any purchase made by Parent of Ordinary Shares and such
purchase shall involve the payment of aggregate consideration in an amount
(determined as the sum of the aggregate amount of cash consideration and the
aggregate fair market value (as reasonably determined in good faith by the
Board of Directors of Parent, whose determination shall be conclusive evidence
of such fair market value and which shall be evidenced by an Officers’
Certificate of Parent delivered to the Trustee) of any other consideration)
that, together with the aggregate amount of (i) any cash and the fair market
value (as reasonably determined in good faith by the Board of Directors of
Parent, whose determination shall be conclusive evidence of such fair market
value and which shall be evidenced by an Officers’ Certificate of Parent
delivered to the Trustee) of any other consideration payable in respect of any
other purchase by Parent for Ordinary Shares consummated within the 12 months
preceding the Expiration Date (as defined below) and in respect of which no
Conversion Price adjustment pursuant to this Section 5.06 has been made and
(ii) all cash distributions to all or substantially all holders of its Ordinary
Shares made within the 12 months preceding the Expiration Date and in respect
of which no Conversion Price adjustment pursuant to this Section 5.06 has been
made, exceeds an amount equal to 10.0% of the product of the Current Market
Price Per Ordinary Share as of the most recent date (the “Expiration Date”)
where a purchase was made (the last time at which a purchase was made on the
Expiration Date is hereinafter sometimes called the “Expiration
Time”) multiplied by the number of Ordinary Shares outstanding (including
shares purchased within the last 12 months preceding the Expiration Date, the
“Purchased Shares”) at the Expiration Time, then, immediately prior to the
opening of business on the day after the Expiration Date, the Conversion Price
shall be reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the close of
business on the Expiration Date by a fraction of which the numerator shall be
the product of the number of Ordinary Shares outstanding (including Purchased
Shares) at the Expiration Time multiplied by the Current Market Price Per
Ordinary Share on the Trading Day next succeeding the Expiration Date and the
denominator shall be the sum of (x) the aggregate consideration (determined as
aforesaid) payable to shareholders of all Purchased Shares and (y) the product
of the number of Ordinary Shares outstanding (less any Purchased Shares) at the
Expiration Time and the Current Market Price Per Ordinary Share on the Trading
Day next succeeding the Expiration Date, such reduction to become effective
immediately prior to the opening of business on the day following the
Expiration Date. In the event that Parent is obligated to purchase Ordinary
Shares, but Parent is permanently prevented by applicable law from effecting
any or all



10









 





such purchases or any or all such purchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which would
have been in effect based upon the number of Ordinary Shares actually
purchased. If the application of this Section 5.06(e) to any purchase would
result in an increase in the Conversion Price, no adjustment shall be made for
such purchase under this Section 5.06(e).




     (f) For the purpose of any computation under subsections (b), (c), (d) and
(e) of this Section 5.06, the current market price per Ordinary Share (the
“Current Market Price Per Ordinary Share”) on any date shall be deemed to be
the average of the daily Closing Prices for the 30 consecutive Trading Days
commencing 45 Trading Days before (i) the Determination Date or the Expiration
Date, as the case may be, with respect to distributions or purchases under
subsection (e) of this Section 5.06 or (ii) the record date with respect to
distributions, issuances or other events requiring such computation under
subsection (b), (c) or (d) of this Section 5.06. The Closing Price for each day
(the “Closing Price”) shall be the ADS Closing Price for such day as adjusted
by the then effective Ordinary Shares-to-ADS ratio. The ADS Closing Price of
each day (the “ADS Closing Price”) shall be the last reported sales price or,
in case no such reported sale takes place on such date, the average of the
reported closing bid and asked prices in either case on the New York Stock
Exchange (the “NYSE”) or the Nasdaq National Market (the “NNM”), or, if
Parent’s ADS is not listed or admitted to trading on the NYSE or the NNM, the
principal national securities exchange or quotation system on which Parent’s
ADS is quoted or listed or admitted to trading or, if not quoted or listed or
admitted to trading on any national securities exchange or quotation system,
the closing sales price or, in case no reported sale takes place, the average
of the closing bid and asked prices, as furnished by any two members of the
National Association of Securities Dealers, Inc. selected from time to time by
Parent for that purpose. If no such ADS Closing Prices are available, the
Current Market Price Per Ordinary Share shall be the fair value of an Ordinary
Share (as reasonably determined in good faith by the Board of Directors of
Parent whose determination shall be conclusive evidence of such fair market
value and which shall be evidenced by an Officers’ Certificate of Parent
delivered to the Trustee).



     (g) In case the Ordinary Shares-to-ADS ratio is adjusted, then the
Conversion Price shall be adjusted proportionately so that the Holder of any
Security thereafter surrendered
for conversion shall be entitled to receive ADSs representing the number
Ordinary Shares as if the Security had been converted immediately prior to the
Ordinary Shares-to-ADS ratio adjustment, provided, that if the adjustment to
the Ordinary Shares-to-ADS ratio is adjusted pursuant to, or in connection
with, or as a result of, an event described in subsections (a) to (e) of this
Section 5.06, and an adjustment to the Conversion Price has been made pursuant
to the applicable subsection, no adjustment to the Conversion Price shall be
made pursuant to this subsection (g). An adjustment made pursuant to this
subsection (g) shall become effective immediately after the effectiveness of
the Ordinary Shares-to-ADS adjustment.



     (h) In any case in which this Section 5.06 shall require that an
adjustment be made following a record date or a Determination Date or
Expiration Date, as the case may be, established for purposes of this Section
5.06, Parent may elect to defer (but only until five Business Days following
the filing by Parent with the Trustee of the certificate described in Section
5.09) issuing to the Holder of any Security converted after such record date or
Determination Date or Expiration Date the Ordinary Shares and other capital
stock of Parent


11









 





issuable upon such conversion over and above the Ordinary
Shares and other capital stock of Parent
 issuable upon such conversion only on
the basis of the Conversion Price prior to adjustment; and, in lieu of the
Ordinary Shares the issuance of which is so deferred, Parent shall issue or
cause its transfer agent to issue due bills or other appropriate evidence
prepared by Parent of the right to receive the Ordinary Shares. If any
distribution in respect of which an adjustment to the Conversion Price is
required to be made as of the record date or Determination Date or Expiration
Date therefor is not thereafter made or paid by Parent for any reason, the
Conversion Price shall be readjusted to the Conversion Price which would then
be in effect if such record date had not been fixed or such effective date or
Determination Date or Expiration Date had not occurred.




     Section 5.07 No Adjustment. No adjustment in the Conversion Price shall
be required unless the adjustment would require an increase or decrease of at
least 1 % in the Conversion Price as last adjusted; provided, however, that any
adjustments which by reason of this Section 5.07 are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Article 5 shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.



     No adjustment need be made for issuances of Ordinary Shares pursuant to a
plan for reinvestment of dividends or interest or for a change in the par value
or a change to no par value of the Ordinary Shares.



     To the extent that the Securities become convertible into the right to
receive cash, no adjustment need be made thereafter as to the cash. Interest
will not accrue on the cash.



     Section 5.08 Adjustment for Tax Purposes. Parent shall be entitled to
make such reductions in the Conversion Price, in addition to those required by
Section 5.06, as it in its discretion shall determine to be advisable in order
that any stock dividends, subdivisions of shares, distributions of rights to
purchase stock or
securities or distributions of securities convertible into or exchangeable
for stock hereafter made by Parent to its shareholders shall not be taxable.



     Section 5.09 Notice of Adjustment. Whenever the Conversion Price or
conversion privilege is adjusted, Parent shall promptly mail to Securityholders
a notice of the adjustment and file with the Trustee an Officer’s Certificate
of Parent briefly stating the facts requiring the adjustment and the manner of
computing it. Unless and until the Trustee shall receive an Officer’s
Certificate of Parent setting forth an adjustment of the Conversion Price, the
Trustee may assume without inquiry that the Conversion Price has not been
adjusted and that the last Conversion Price of which it has knowledge remains
in effect.



     Section 5.10 Notice of Certain Transactions. In the event that:



     (i) Parent takes any action which would require an adjustment in the
Conversion Price;



     (j) Parent consolidates or merges with or into, or transfers all or
substantially all of its property and assets to, another corporation or another
corporation merges into Parent and, in each such case, shareholders of Parent
must approve the transaction; or



12









 





     (k) there is a dissolution or liquidation of Parent,



     Parent shall mail to Holders and file with the Trustee a notice stating
the proposed record or effective date, as the case may be. Parent shall mail
the notice at least ten days before such date. Failure to mail such notice or
any defect therein shall not affect the validity of any transaction referred to
in clause (1), (2) or (3) of this Section 5.10.



     Section 5.11 Effect of Reclassification, Consolidation, Merger or Sale on
Conversion Privilege. If any of the following shall occur, namely: (a) any
reclassification or change of Ordinary Shares represented by ADSs issuable upon
conversion of the Securities (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of a
subdivision or combination, or any other change for which an adjustment is
provided in Section 5.06); (b) any consolidation or merger or combination to
which Parent is a party other than a merger in which Parent is the continuing
corporation and which does not result in any reclassification of, or change
(other than in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination) in,
outstanding Ordinary Shares; or (c) any sale, conveyance, transfer or lease of
the property and assets of Parent as an entirety or substantially as an
entirety, directly or indirectly, to any Person, then Parent, or such
successor, purchasing, transferee or leasing Person, as the case may be, shall,
as a condition precedent to such reclassification, change, combination,
consolidation, merger, sale, conveyance, transfer or lease, execute and deliver
to the Trustee a supplemental indenture providing that the Holder of each
Security then outstanding shall have the right to convert such Security into
the
kind and amount of shares of stock and other securities and property
(including cash) receivable upon such reclassification, change, combination,
consolidation, merger, sale, conveyance, transfer or lease by a holder of the
number of ADSs deliverable upon conversion of such Security immediately prior
to such reclassification, change, combination, consolidation, merger, sale,
conveyance, transfer or lease. Such supplemental indenture shall provide for
adjustments of the Conversion Price that shall be as nearly equivalent as may
be practicable to the adjustments of the Conversion Price provided for in
Article 5. If, in the case of any such consolidation, merger, combination,
sale, conveyance, transfer or lease the stock or other securities and property
(including cash) receivable thereupon by a holder of Ordinary Shares, include
shares of stock or other securities and property of a Person other than the
successor, purchasing, transferee or leasing Person, as the case may be, in
such consolidation, merger, combination, sale, conveyance, transfer or lease,
then such supplemental indenture shall also be executed by such other Person
and shall contain such additional provisions to protect the interests of the
Holders of the Securities as the Board of Directors of the Company or Parent
shall reasonably consider necessary by reason of the foregoing. The provisions
of this Section 5.11 shall similarly apply to successive reclassifications,
changes, combinations, consolidations, mergers, sales, conveyances, transfers
or leases.



     In the event the Company or Parent shall execute a supplemental indenture
pursuant to this Section 5.11, Parent shall promptly file with the Trustee (x)
an Officer’s Certificate of Parent briefly stating the reasons therefor, the
kind or amount of shares of stock or other securities or property (including
cash) receivable by Holders of the Securities upon the conversion of their
Securities after any such reclassification, change, combination, consolidation,
merger, sale, conveyance, transfer or lease, any adjustment to be made with
respect thereto and that all conditions precedent have been complied with and
(y) an Opinion of Counsel that all



13









 





conditions precedent have been complied
with, and shall promptly mail notice thereof to all Holders.




     Section 5.12 Trustee’s Disclaimer. The Trustee shall have no duty to
determine when an adjustment under this Article 5 should be made, how it should
be made or what such adjustment should be, but may accept as conclusive
evidence of that fact or the correctness of any such adjustment, and shall be
protected in relying upon, an Officer’s Certificate of the Company or Parent,
including the Officer’s Certificate of Parent with respect thereto which Parent
is obligated to file with the Trustee pursuant to Section 5.09. The Trustee
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Securities, and the Trustee shall not be responsible
for the Company’s or Parent’s failure to comply with any provisions of this
Article 5.



     The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 5.11, but may accept as conclusive evidence of the
correctness thereof, and shall be fully protected in relying upon, the
Officer’s Certificate with respect thereto which Parent is obligated to file
with the Trustee pursuant to Section 5.11.



     Section 5.13 Voluntary Reduction. Parent from time to time may voluntarily reduce the Conversion Price by
any amount for any period of time if the period is at least 20 days and if the
reduction is irrevocable during the period if the Board of Directors of Parent
determines that such reduction would be in the best interests of Parent, and
Parent provides 15 days’ prior notice of any voluntary reduction in the
Conversion Price; provided, however, that in no event may Parent reduce the
Conversion Price to be less than the par value of an Ordinary Share, and
provided, further, that no such decrease shall be taken into account for
purposes of the determination of whether the ADS Closing Price exceeds 105% of
the Conversion Price pursuant to Section 4.07.”



ARTICLE 4




AMENDMENT TO EVENTS OF DEFAULT




     Section 4.01 Amendment to Definition of “Events of Default”. The
definition of “Events of Default” in Section 7.01 of the Indenture is amended
as follows:



     (a) by adding “or Parent” after each instance the word “Company” is used
in clause (6) or (7), deleting the word “or” at the end of clause (7), deleting
the period at the end of clause (8) and adding the word “or”;



     (b) by adding the following clauses after clause (8):




	 	(9)	 	Parent fails to comply with any of
its agreements contained in the Securities or this
Indenture and such failure continues for 60 days after
the notice specified below:




14









 











     (c) by replacing in each instance the words “clauses (3) or (5)” with
“clauses (3), (5) or (9)” in the third to the last and the penultimate
paragraphs of Section 7.01.



ARTICLE 5




MISCELLANEOUS




     Section 5.01 Notices. Any notice or communication shall be in writing and
delivered or mailed to the address set forth below:



     if to the Company:


ChipPAC, Inc.

47400 Kato Road

Fremont, CA 94538

Facsimile No.: (510) 979-8000

Attention: Chief Financial Officer



     if to Parent:


ST Assembly Test Services Ltd

10 Ang Mo Kio Street 65

#05-17/20 Techpoint

Singapore 569059

Facsimile No.: (65) 6824-7629

Attention: General Counsel



     if to the Trustee:


U.S. Bank National Association

60 Livingston Avenue

St. Paul, MN 55107-2292

Telephone No. (651) 495-3913

Facsimile: (651) 495-8097

Attention: Corporate Trust Department



     The Company, Parent or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.



     Any notice or communication mailed to a Securityholder shall be mailed to
the Securityholder at the Securityholder’s address as it appears on the
registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.



     Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to any other
Securityholder. If a notice or



15









 





communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.




     Section 5.02 Communication by Holders with Other Holders. Securityholders
may communicate pursuant to TIA § 312(b) with other Securityholders with
respect to their rights under this Indenture or the Securities. The Company,
Parent, the Trustee, the Registrar and anyone else shall have the protection of
TIA § 312(c).



     Section 5.03 Separability Clause. In case any provision in this First
Supplemental Indenture shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.



     Section 5.04 Confirmation; Effectiveness. As amended by this First
Supplemental Indenture, the Indenture and the Securities are ratified and
confirmed in all respects and the Indenture as so amended shall be read, taken
and construed as one and the same instrument. The provisions of this First
Supplemental Indenture shall become operative as of the date of this First
Supplemental Indenture.



     Section 5.05 GOVERNING LAW. THIS FIRST SUPPLEMENTAL INDENTURE AND THE
SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.



     Section 5.06 No Recourse Against Others. A director, officer, employee or
stockholder, or shareholder, as such, of the Company or Parent shall not have
any liability for any obligations of the Company under the Securities, the
Indenture or this First Supplemental Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder shall waive and release all such liability. This
waiver and release shall be part of the consideration for the execution of this
First Supplemental Indenture.



     Section 5.07 Successors. All agreements of the Company and Parent in this
First Supplemental Indenture, the Indenture and the Securities shall bind their
successors. All agreements of the Trustee in this First Supplemental
Indenture, the Indenture and the Securities shall bind its successors.



     Section 5.08 Multiple Originals. The parties may sign any number of
copies of this First Supplemental Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement. One signed
copy is enough to prove this First Supplemental Indenture.



     Section 5.09 Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this First
Supplemental Indenture and the Indenture have been inserted for convenience of
reference only, are not intended to be considered a part hereof and shall not
modify or restrict any of the terms or provisions hereof.



16









 





     IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be executed by their duly authorized officers as of the date first
above written.



	 	 	 	 	 
	 	 	CHIPPAC, INC.
	 	 	
By:
	 	/s/ Dennis McKenna



Name:  Dennis McKenna

Title:    President and Chief Executive Officer







 









 






     IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be executed by their duly authorized officers as of the date first
above written.



	 	 	 	 	 
	 	 	ST ASSEMBLY TEST SERVICES LTD
	 	 	
By:
	 	/s/  Tan Lay Koon



Name:  Tan Lay Koon

Title:    President and Chief Executive Officer







 









 






     IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be executed by their duly authorized officers as of the date first
above written.



	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION
	 	 	
By:
	 	/s/  Frank P. Leslie III



Name:  Frank P. Leslie III

Title:    Vice President







 









 







EXHIBIT A




[FORM OF FACE OF SECURITY]




     [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY
IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN
THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.]1



     [THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND THIS SECURITY AND THE ST ASSEMBLY TEST
SERVICES LTD ORDINARY SHARES REPRESENTED BY AMERICAN DEPOSITARY SHARES (“ADSs”)
ISSUABLE UPON CONVERSION THEREOF MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER
OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.]2









	1	 	These paragraphs should be included only if the Security is a Global
Security.
	 
	2	 	These paragraphs to be included only if the Security is a Transfer Restricted
Security.




A-1









 










     [THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF CHIPPAC, INC. THAT
(a) THIS SECURITY AND THE ADSs ISSUABLE UPON CONVERSION THEREOF MAY BE OFFERED,
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH
(IV), IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (b) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (a) ABOVE. IN ANY CASE, THE HOLDER HEREOF WILL NOT, DIRECTLY OR
INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY
EXCEPT AS PERMITTED UNDER THE SECURITIES ACT.]2



     [THE HOLDER OF THIS SECURITY IS ENTITLED TO THE BENEFITS OF A REGISTRATION
RIGHTS AGREEMENT (AS SUCH TERM IS DEFINED IN THE INDENTURE REFERRED TO ON THE
REVERSE HEREOF) AND, BY ITS ACCEPTANCE HEREOF, AGREES TO BE BOUND BY AND TO
COMPLY WITH THE PROVISIONS OF SUCH REGISTRATION RIGHTS AGREEMENT.]



     [THIS SECURITY MAY NOT BE SOLD OR TRANSFERRED TO, AND EACH PURCHASER BY
ITS PURCHASE OF THIS SECURITY SHALL BE DEEMED TO HAVE REPRESENTED AND
COVENANTED THAT IT IS NOT ACQUIRING THIS SECURITY FOR OR ON BEHALF OF, AND WILL
NOT TRANSFER THIS SECURITY TO, ANY EMPLOYEE BENEFIT PLAN (A “PLAN”) AS DEFINED
IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED (“ERISA”), EXCEPT THAT SUCH PURCHASE FOR OR ON BEHALF OF A PLAN SHALL
BE PERMITTED:



     1. TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF A BANK
COLLECTIVE INVESTMENT FUND MAINTAINED BY THE PURCHASER IN WHICH NO PLAN
(TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE
ORGANIZATION) HAS AN INTEREST IN EXCESS OF 10% OF THE TOTAL ASSETS IN SUCH
COLLECTIVE INVESTMENT FUND, AND THE OTHER APPLICABLE CONDITIONS OF PROHIBITED
TRANSACTION CLASS EXEMPTION 91-38 ISSUED BY THE DEPARTMENT OF LABOR ARE
SATISFIED;



     2. TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN INSURANCE
COMPANY POOLED SEPARATE ACCOUNT MAINTAINED BY



A-2









 





THE PURCHASER IN WHICH, AT ANY TIME WHILE THESE SECURITIES ARE
OUTSTANDING, NO PLAN (TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE SAME
EMPLOYER OR EMPLOYEE ORGANIZATION) HAS AN INTEREST IN EXCESS OF 10% OF THE
TOTAL OF ALL ASSETS IN SUCH POOLED SEPARATE ACCOUNT, AND THE OTHER APPLICABLE
CONDITIONS OF PROHIBITED TRANSACTION CLASS EXEMPTION 90-1 ISSUED BY THE
DEPARTMENT OF LABOR ARE SATISFIED;




     3. TO THE EXTENT SUCH PURCHASE IS MADE BY AN INVESTMENT FUND ON BEHALF OF
A PLAN BY (A) AN INVESTMENT ADVISER REGISTERED UNDER THE INVESTMENT ADVISERS
ACT OF 1940, AS AMENDED (THE “1940 ACT”), THAT HAD AS OF THE LAST DAY OF ITS
MOST RECENT FISCAL YEAR TOTAL ASSETS UNDER ITS MANAGEMENT AND CONTROL IN EXCESS
OF $50.0 MILLION AND HAD STOCKHOLDERS’ OR PARTNERS’ EQUITY IN EXCESS OF
$750,000, AS SHOWN IN ITS MOST RECENT BALANCE SHEET PREPARED IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, OR (B) A BANK AS DEFINED IN SECTION
202(A)(2) OF THE 1940 ACT WITH EQUITY CAPITAL IN EXCESS OF $1.0 MILLION AS OF
THE LAST DAY OF ITS MOST RECENT FISCAL YEAR, OR (C) AN INSURANCE COMPANY WHICH
IS QUALIFIED UNDER THE LAWS OF MORE THAN ONE STATE TO MANAGE, ACQUIRE OR
DISPOSE OF ANY ASSETS OF A PENSION OR WELFARE PLAN, WHICH INSURANCE COMPANY HAS
AS OF THE LAST DAY OF ITS MOST RECENT FISCAL YEAR, NET WORTH IN EXCESS OF $1.0
MILLION AND WHICH IS SUBJECT TO SUPERVISION AND EXAMINATION BY A STATE
AUTHORITY HAVING SUPERVISION OVER INSURANCE COMPANIES AND, IN ANY CASE, SUCH
INVESTMENT ADVISER, BANK OR INSURANCE COMPANY IS OTHERWISE A QUALIFIED
PROFESSIONAL ASSET MANAGER, AS SUCH TERM IS USED IN PROHIBITED TRANSACTION
CLASS EXEMPTION 84-14 ISSUED BY THE DEPARTMENT OF LABOR, AND THE ASSETS OF SUCH
PLAN WHEN COMBINED WITH THE ASSETS OF OTHER PLANS ESTABLISHED OR MAINTAINED BY
THE SAME EMPLOYER (OR AFFILIATE THEREOF) OR EMPLOYEE ORGANIZATION AND MANAGED
BY SUCH INVESTMENT ADVISER, BANK OR INSURANCE COMPANY, DO NOT REPRESENT MORE
THAN 20% OF THE TOTAL CLIENT ASSETS MANAGED BY SUCH INVESTMENT ADVISER, BANK OR
INSURANCE COMPANY AT THE TIME OF THE TRANSACTION, AND THE OTHER APPLICABLE
CONDITIONS OF SUCH EXEMPTION ARE OTHERWISE SATISFIED;



     4. TO THE EXTENT SUCH PLAN IS A GOVERNMENTAL PLAN, AS DEFINED IN SECTION
3(32) OF ERISA WHICH IS NOT SUBJECT TO THE PROVISIONS OF TITLE 1 OF ERISA, AND
AS DEFINED IN SECTION 414(d) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE “CODE”);



     5. TO THE EXTENT SUCH PURCHASE IS MADE BY OR ON BEHALF OF AN INSURANCE
COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT, THE RESERVES AND LIABILITIES
FOR THE GENERAL ACCOUNT CONTRACTS HELD BY OR ON BEHALF OF ANY PLAN, TOGETHER
WITH ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER (OR ITS AFFILIATES) OR
EMPLOYEE



A-3









 





ORGANIZATION, DO NOT EXCEED 10% OF THE TOTAL RESERVES AND LIABILITIES OF
THE INSURANCE COMPANY GENERAL ACCOUNT (EXCLUSIVE OF SEPARATE ACCOUNT
LIABILITIES), PLUS SURPLUS AS SET FORTH IN THE NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONERS ANNUAL STATEMENT FILED WITH THE STATE OF DOMICILE OF
THE INSURER, IN ACCORDANCE WITH PROHIBITED TRANSACTION CLASS EXEMPTION 95-60,
AND THE OTHER APPLICABLE CONDITIONS OF SUCH EXEMPTION ARE OTHERWISE SATISFIED;




     6. TO THE EXTENT PURCHASE IS MADE BY AN IN-HOUSE ASSET MANAGER WITHIN THE
MEANING OF PART IV(A) OF PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, SUCH
MANAGER HAS MADE OR PROPERLY AUTHORIZED THE DECISION FOR SUCH PLAN TO PURCHASE
THIS SECURITY, UNDER CIRCUMSTANCES SUCH THAT PROHIBITED TRANSACTION CLASS
EXEMPTION 96-23 IS APPLICABLE TO THE PURCHASE AND HOLDING OF THIS SECURITY; OR



     7. TO THE EXTENT SUCH PURCHASE WILL NOT OTHERWISE GIVE RISE TO A
TRANSACTION DESCRIBED IN SECTION 406 OR SECTION 4975(C)(1) OF THE CODE FOR
WHICH A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.]



A-4









 





CHIPPAC, INC.




CUSIP No. [*]




             No. 1



ISIN No. [*]




2.50% CONVERTIBLE SUBORDINATED NOTE DUE 2008




     ChipPAC, Inc., a Delaware corporation (the “Company”, which term shall
include any successor corporation under the Indenture referred to on the
reverse hereof), promises to pay to Cede & Co., or registered assigns, the
principal sum of 150,000,000 US Dollars on June 1, 2008 [or such
greater or lesser amount as is indicated on the Schedule of Exchanges of
Securities on the other side of this Security].3



     Interest Payment Dates: June 1 and December 1, beginning December 1, 2003



     Record Dates: May 15 and November 15



     This Security is convertible as specified on the other side of this
Security. Additional provisions of this Security are set forth on the other
side of this Security.



[Signatures on Following Pages]










	3	 	This phrase should be included only if the Security is a Global Security




A-5









 










     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.



	 	 	 	 	 
	 	 	CHIPPAC, INC.
	 	 	
By:
	 	 



Name:
Title:







Trustee’s Certificate of Authentication: This is one

of the Securities referred to in the within-mentioned

Indenture.




U.S. BANK NATIONAL ASSOCIATION,

as Trustee,







Authorized Signatory




By: Frank P. Leslie III




A-6









 








[FORM OF REVERSE SIDE OF SECURITY]




CHIPPAC, INC.

2.50% CONVERTIBLE SUBORDINATED NOTE DUE JUNE 1, 2008




1. Interest




     ChipPAC, Inc., a Delaware corporation (the “Company” which term shall
include any successor corporation under the Indenture hereinafter referred to),
promises to pay interest on the principal amount of this Security at the rate
of 2.50% per annum. The Company shall pay interest semiannually on June 1 and
December 1 of each year, commencing December 1, 2003; provided, however, that
such interest may be increased by any Additional Interest accruing from time to
time on the principal amount of this Security as provided in the Registration
Rights Agreement. Any reference herein to interest accrued or payable as of
any date shall include any Additional Interest accrued or payable on such date
as provided in the Registration Rights Agreement. Interest on the Securities
shall accrue from the most recent date to which interest has been paid or, if
no interest has been paid, from May 28, 2003; provided, however, that if there
is not an existing Default in the payment of interest and if this Security is
authenticated between a record date referred to on the face hereof and the next
succeeding interest payment date, interest shall accrue from such interest
payment date. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.



2. Method of Payment




     The Company shall pay interest on this Security (except defaulted
interest) to the person who is the Holder of this Security at the close of
business on May 15 or November 15, as the case may be, next preceding the
related interest payment date. The Holder must surrender this Security to a
Paying Agent to collect payment of principal. The Company will pay principal
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. The Company may, however, pay
principal and interest in respect of any Certificated Security by check or wire
payable in such money; provided, however, that a Holder with an aggregate
principal amount in excess of $2,000,000 will be paid by wire transfer in
immediately available funds at the election of such Holder. The Company may
mail an interest check to the Holder’s registered address. Notwithstanding the
foregoing, so long as this Security is registered in the name of a Depositary
or its nominee, all payments hereon shall be made by wire transfer of
immediately available funds to the account of the Depositary or its nominee.



     3. Paying Agent, Registrar and Conversion Agent



     Initially, U.S. Bank National Association (the “Trustee”, which term shall
include any successor trustee under the Indenture hereinafter referred to) will
act as Paying Agent, Registrar and Conversion Agent. The Company may change
any Paying Agent, Registrar or Conversion Agent without notice to the Holder.
The Company or any of its Subsidiaries may, subject to certain limitations set
forth in the Indenture, act as Paying Agent or Registrar.



A-7









 





4. Indenture, Limitations




     This Security is one of a duly authorized issue of Securities of the
Company designated as its 2.50% Convertible Subordinated Notes Due 2008 (the
“Securities”) issued under an Indenture dated as of May 28, 2003 (together with
any supplemental indentures thereto, the “Indenture”), among the Company, STATS
ChipPAC, Ltd and the Trustee. Capitalized terms herein are used as defined in
the Indenture unless otherwise defined herein. The terms of this Security
include those stated in the Indenture and those required by or made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended, as in
effect on the date of the Indenture. This Security is subject to all such
terms, and the Holder of this Security is referred to the Indenture and said
Act for a statement of them. The Securities are subordinated unsecured
obligations of the Company limited to $150,000,000 aggregate principal amount.
The Indenture does not limit other debt of the Company, secured or unsecured,
including Senior Indebtedness.



5. Purchase of Securities at Option of Holder Upon a Change of Control




     At the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall become obligated to purchase all or any part
specified by the Holder (so long as the principal amount of such part is $1,000
or an integral multiple of $1,000 in excess thereof) of the Securities held by
such Holder on the date that is no less than 30 days and not more than 60 days
after notice of the occurrence of a Change of Control is given as provided in
Section 4.07, at a purchase price equal to 100% of the principal amount thereof
together with accrued interest up to, but excluding, the Change of Control
Purchase Date. The Holder shall have the right to withdraw any Change of
Control Purchase Notice (in whole or in a portion thereof that is $1,000 or an
integral multiple of $1,000 in excess thereof) at any time prior to the close
of business on the Business Day next preceding the Change of Control Purchase
Date by delivering a written notice of withdrawal to the Paying Agent in
accordance with the terms of the Indenture.



6. Conversion




     A Holder of a Security may convert the principal amount of such Security
(or any portion thereof equal to $1,000 or any integral multiple of $1,000 in
excess thereof) into ADSs at any time prior to the close of business on the
Business Day immediately preceding June 1, 2008; provided, however, that if the
Security is subject to purchase upon a Change of Control, the conversion right
will terminate at the close of business on the Business Day immediately
preceding the Change of Control Purchase Date for such Security or such earlier
date as the Holder presents such Security for purchase (unless the Company
shall default in making the Change of Control Purchase Price when due, in which
case the conversion right shall terminate at the close of business on the date
such default is cured and such Security is purchased). The initial Conversion
Price is $9.267, subject to adjustment under certain circumstances. The ADSs,
when issued, shall be subject to the terms of the Deposit Agreement. The
number of ADSs issuable upon conversion of a Security is determined by dividing
the principal amount of the Security or portion thereof being converted by the
Conversion Price in effect on the Conversion Date. No fractional ADSs will be
issued upon conversion; in lieu thereof, an amount will be paid in cash based
upon the ADS Closing Price on the Trading Day immediately prior to



A-8









 





the Conversion Date. To convert a Security, a Holder must (a) complete
and manually sign the conversion notice set forth below and deliver such notice
to a Conversion Agent, (b) surrender the Security to a Conversion Agent, (c)
furnish appropriate endorsements and transfer documents if required by a
Registrar or a Conversion Agent and (d) pay any transfer or similar tax, if
required. The Conversion Agent shall use commercially reasonable efforts to
procure the completion of Part II of the Conversion Notice by the Holder who
converts a Security. The Conversion Agent shall promptly, but in no event
later than two Business Days following the Conversion Date, deliver a copy of
such duly completed Conversion Notice to the ADS Depositary, the Custodian (as
defined in the Deposit Agreement), the Company and counsel to the Company.
Securities so surrendered for conversion (in whole or in part) during the
period from the close of business on any regular record date to the opening of
business on the next succeeding interest payment date (excluding Securities or
portions thereof which are subject to purchase following a Change of Control on
a date during the period beginning at the close of business on a regular record
date and ending at the opening of business on the first Business Day after the
next succeeding interest payment date, or if such interest payment date is not
a Business Day, the second such Business Day) shall also be accompanied by
payment in funds acceptable to the Company of an amount equal to the interest
payable on such interest payment date on the principal amount of such Security
then being converted, and such interest shall be payable to such registered
Holder notwithstanding the conversion of such Security, subject to the
provisions of this Indenture relating to the payment of defaulted interest by
the Company. If the Company defaults in the payment of interest payable on such
interest payment date, the Company shall promptly repay such funds to such
Holder. A Holder may convert a portion of a Security equal to $1,000 or any
integral multiple thereof. A Security in respect of which a Holder had
delivered a Change of Control Purchase Notice exercising the option of such
Holder to require the Company to purchase such Security may be converted only
if the Change of Control Purchase Notice is withdrawn in accordance with the
terms of the Indenture.




7. Subordination




     The indebtedness evidenced by the Securities is, to the extent and in the
manner provided in the Indenture, subordinate and junior in right of payment to
the prior payment in full of all Senior Indebtedness of the Company. Any
Holder by accepting this Security agrees to and shall be bound by such
subordination provisions and authorizes the Trustee to give them effect. In
addition to all other rights of Senior Indebtedness described in the Indenture,
the Senior Indebtedness shall continue to be Senior Indebtedness and entitled
to the benefits of the subordination provisions irrespective of any amendment,
modification or waiver of any terms of any instrument relating to the Senior
Indebtedness or any extension or renewal of the Senior Indebtedness.



8. Denominations, Transfer, Exchange



     The Securities are in registered form without coupons in denominations of
$1,000 and integral multiples of $1,000. A Holder may register the transfer of
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes or other governmental charges that may
be imposed in relation thereto by law or permitted by the Indenture.



A-9









 





9. Persons Deemed Owners




     The Holder of a Security may be treated as the owner of it for all
purposes.



10. Unclaimed Money




     If money for the payment of principal or interest remains unclaimed for
two years, the Trustee or Paying Agent will pay the money back to the Company
at its written request. After that, Holders entitled to money must look to the
Company for payment.



11. Amendment, Supplement and Waiver



     Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Securities then outstanding, and an existing Default
or Event of Default and its consequence or compliance with any provision of the
Indenture or the Securities may be waived in a particular instance with the
consent of the Holders of a majority in principal amount of the Securities then
outstanding. Without the consent of or notice to any Holder, the Company and
the Trustee may amend or supplement the Indenture or the Securities to, among
other things, cure any ambiguity, defect or inconsistency or make any other
change that does not adversely affect the rights of any Holder.



12. Successor Corporation




     When a successor corporation assumes all the obligations of its
predecessor under the Securities and the Indenture in accordance with the terms
and conditions of the Indenture, the predecessor corporation will (except in
certain circumstances specified in the Indenture) be released from those
obligations.



13. Defaults and Remedies




     Under the Indenture, an Event of Default includes: (1) the Company
defaults in any payment of interest on any Security when the same becomes due
and payable, whether or not such payment shall be prohibited by Article 11, and
such default continues for a period of 30 days; (2) the Company (i) defaults in
the payment of the principal of any Security when the same becomes due and
payable at its Stated Maturity, upon declaration of acceleration or otherwise,
whether or not such payment shall be prohibited by Article 11 or (ii) fails to
purchase Securities when required pursuant to this Indenture or the Securities,
whether or not such purchase shall be prohibited by Article 11; (3) the Company
fails to comply with its obligations with respect to a Change of Control in
accordance with Sections 4.07, 4.08, 4.09, 4.10 and 4.11 (other than its
obligation to purchase securities properly submitted for purchase); (4) the
Company fails to comply with its obligations under Section 6.01; (5) the
Company or Parent fails to comply with any of its agreements in the Securities
or the Indenture (other than those referred to in clauses (1) through (4)
above) and such failure continues for 60 days after the notice specified below;
or (6) the Company or Parent pursuant to or within the meaning of any
Bankruptcy Law: (A) commences a voluntary case; (B) consents to the entry of an
order for relief against it in an involuntary case; (C) consents to the
appointment of a Custodian of it or for a substantial part of its property; or
(D) makes a general assignment for the benefit of its creditors; (7) a court of




A-10









 





competent jurisdiction enters an order or decree under any Bankruptcy Law
that: (A) is for relief against the Company or Parent in an involuntary case;
(B) appoints a Custodian of the Company or Parent or for all or substantially
all of its property; or (C) orders the winding up or liquidation of the Company
or Parent; and the order or decree remains unstayed and in effect for 60 days
(together with Clause (6), the “bankruptcy provisions”); and (8) Indebtedness
of the Company is not paid within 15 days of any applicable grace period after
final maturity or is accelerated by the holders thereof because of a default
and the total amount of such Indebtedness unpaid or accelerated exceeds $15.0
million (the “cross acceleration provision”).



     If an Event of Default (other than an event of default as described in
clauses (6) and (7) with respect to the Company) occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the Securities
then outstanding may declare all unpaid principal to the date of acceleration
on the Securities then outstanding to be due and payable immediately, all as
and to the extent provided in the Indenture. If an Event of Default occurs as
a result of certain events of bankruptcy, insolvency or reorganization of the
Company or as described in clauses (6) and (7) herein, unpaid principal of the
Securities then outstanding shall become due and payable immediately without
any declaration or other act on the part of the Trustee or any Holder, all as
and to the extent provided in the Indenture. Holders may not enforce the
Indenture or the Securities except as provided in the Indenture. The Trustee
may require indemnity satisfactory to it before it enforces the Indenture or
the Securities. Subject to certain limitations, Holders of a majority in
principal amount of the Securities then outstanding may direct the Trustee in
its exercise of any trust or power. The Trustee may withhold from Holders
notice of any continuing Default (except a Default in payment of principal or
interest) if it determines that withholding notice is in their interests. The
Company is required to file periodic reports with the Trustee as to the absence
of Default.



14. Trustee Dealings with the Company




     U.S. Bank National Association, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from and
perform services for the Company or an Affiliate of the Company, and may
otherwise deal with the Company or an Affiliate of the Company, as if it were
not the Trustee.



15. No Recourse Against Others




     A director, officer, employee or shareholder, as such, of the Company or
Parent shall not have any liability for any obligations of the Company or
Parent under the Securities or the Indenture nor for any claim based on, in
respect of or by reason of such obligations or their creation. The Holder of
this Security by accepting this Security waives and releases all such
liability. The waiver and release are part of the consideration for the
issuance of this Security.



16. Authentication




     This Security shall not be valid until the Trustee or an authenticating
agent manually signs the certificate of authentication on the other side of
this Security.



A-11









 





17. Abbreviations and Definitions



     Customary abbreviations may be used in the name of the Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian) and UGMA (= Uniform Gifts to Minors
Act). All terms defined in the Indenture and used in this Security but not
specifically defined herein are defined in the Indenture and are used herein as
so defined.



18. Indenture to Control; Governing Law



     In the case of any conflict between the provisions of this Security and
the Indenture, the provisions of the Indenture shall control. This Security
shall be governed by, and construed in accordance with, the laws of the State
of New York, without regard to principles of conflicts of law.



     The Company will furnish to any Holder, upon written request and without
charge, a copy of the Indenture. Requests may be made to: ChipPAC, Inc., 47400
Kato Road, Fremont, California 94538, Attention: Corporate Secretary.



A-12









 





ASSIGNMENT FORM




          To assign this Security, fill in the form below:



I or we assign and transfer this Security to









(Insert assignee’s soc. sec. or tax I.D. no.)





















(Print or type assignee’s name, address and zip code




and irrevocably appoint










agent to transfer this Security on the books of the Company. The agent
may substitute another to act for him or her.



	 	 	 	 	 
	

	 	 	 	Your Signature
	Date:
	 	 	 	 
	

	 	

	 	

	

	 	 	 	(Sign exactly as your name appears on the
other side of this Security)
	*Signature guaranteed by:	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	

	 	
	 	 







*Signature(s) must be guaranteed by a qualified guarantor institution with
membership in an approved signature guarantee program pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended.



A-13









 








CHIPPAC, INC. (the “Company”)

US$150,000,000

2.50% Convertible Subordinated Notes due 2008

(CUSIP No.       )




CONVERSION NOTICE




PART I




     To convert this security (the “Security”) into ST Assembly Test Services
Ltd (the “Parent”) Ordinary Shares represented by American Depositary Shares
(“ADSs”), check this box: o



     To convert only part of this Security, state the principal amount to be
converted (must be $1,000 or a multiple of $1,000): $                    .



PART II





	A.	 	If you wish to receive ADSs upon conversion of your Securities, check and
complete items 1. OR 2. below.
	 
	1.	 	Check here o and complete the grid below if you are requesting conversion
of your Securities for ADSs AND the ADSs have been sold to a third party
pursuant to an effective registration statement under the Securities Act:
	 
	 	 	Deliver ADSs (CUSIP No. 85771T104) to:





	 
	Name of DTC Participant:

	 

	DTC Participant Account No.:

	 

	Account No. for Purchaser at DTC Participant (f/b/o information):

	 

	Onward Delivery instructions to Purchaser:

	 

	Contact person at DTC Participant:

	 

	Daytime Telephone Number of contact person at DTC Participant:








             By checking above and completing the above grid, I/we (i) represent that
I/we am/are not acting on behalf of Parent, the Company or any affiliate of
either Parent or the Company and that the ADSs to be delivered upon conversion
of my/our Securities have been sold pursuant to a resale registration statement
which has been declared effective under the



A-14









 





Securities Act (and which continues to be effective at the time of transfer),
and (ii) certify that the prospectus delivery requirements, if any, of the
Securities Act have been satisfied with respect to the sale described above and
that the person who signed this Conversion Notice is the beneficial owner of
the Securities surrendered herewith and is named as a selling securityholder in
the applicable Prospectus or in amendments or supplements thereto, and that the
number of ADSs transferred are all or a portion of the ADSs listed in such
Prospectus, as amended or supplemented opposite such owner’s name. Details of
my/our designee to receive such ADSs are set forth above.



OR





	2.	 	Check here o and complete the grid below if you are requesting conversion
of your Securities (without concurrent resale under a resale registration
statement) into Restricted ADSs:





	 
	Deliver Restricted ADR (CUSIP No. 85227G888) to:

	 

	Name of Holder:

	 

	Address:

	 

	Tax ID Number:

	 

	Fax Number:

	 

	Daytime Telephone No.:

	 

	Federal Express Account No.:*









	 	*	 	The Restricted ADR(s) will be mailed by U.S. mail unless a
Federal Express Account number is included above.
	 
	 	**	 	Upon receipt of this Conversion Notice, the Conversion Agent
will complete this Conversion Notice, and will promptly, but in any
event not later than two business days following the Conversion
Date, fax the completed Conversion Notice to the ADS Depositary and
the Custodian as specified herein.





     By checking and completing the grid above, I/we (x) represent and agree
that, at the time of signing and delivery of this Conversion Notice, I/we
am/are, or the person who has the beneficial interest in such Securities is,
not Parent, the Company or an affiliate of either Parent or the Company and (i)
is not a U.S. Person (within the meaning of Regulation S under the Securities
Act (“Regulation S”)) and I/we, or such person, purchased such Securities, or
the beneficial interest therein, in a transaction made in accordance with
Regulation S, (ii) is a “qualified institutional buyer” (“QIB”) within the
meaning of Rule 144A under the Securities Act, or (iii) is an “accredited
investor” within the meaning of Regulation D under the Securities Act, (y)
understand that ADSs issued upon conversion of the Securities have not been and
will



A-15









 





not be registered under the Securities Act, and (z) agrees that such ADSs
will be issued in the form of certificated Restricted ADR(s) and may not be
offered, sold, pledged or otherwise transferred except (A) (1) pursuant to Rule
144A under the Securities Act to a person that the holder reasonably believes
is a QIB within the meaning of Rule 144A, (2) in an offshore transaction to a
non-U.S. person made in accordance with Regulation S, (3) pursuant to an
effective registration statement under the Securities Act, or (4) pursuant to
an exemption from registration under the Securities Act and (B) in accordance
with any applicable securities laws of any state of the United States and the
applicable laws of any other jurisdiction. The undersigned understands that
the Restricted ADSs are subject to the terms of a Letter Agreement, dated as of
August 4, 2004, by and between Parent and Citibank, N.A., as ADS Depositary,
which sets forth the restrictions applicable to the Restricted ADSs.



Please read and complete Items C through E below:





	B.	 	The Securities converted hereby and any documents required in relation to
the declarations below or to verify the same accompany this form.
	 
	C.	 	I/we hereby declare that I/we have been notified by Parent that Parent’s
register of shareholders may be closed from time to time. I/We hereby
declare that any applicable condition to conversion of the Securities, if
any, has been complied with by me/us, that I/we am/are not acting on
behalf of Parent, the Company or an affiliate of either.
	 
	D.	 	I/We hereby declare that all stamp, issue, registration or similar taxes
and duties payable on conversion of the Securities in the jurisdiction
where the Securities are delivered to the Conversion Agent have been paid.
	 
	E.	 	Converting Securityholder Information and Signature:
	 
	 	 	Please complete the following information with respect to the converting
Securityholder:





	 
	Name:

	Date:

	Address:

	 
	Telephone Number:

	Signature:








	 	 	 
	*Signature guaranteed by:
	 
	 	 
	By:
	 	 
	

	 	








*Signature(s) must be guaranteed by a qualified guarantor institution with
membership in an approved signature guarantee program pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended.



A-16









 








For Conversion Agent’s use only:




	 	 	 	 	 
	1.

	 	(A)
	 	Securities conversion identification reference: ChipPAC, Inc. 2.50% Convertible
Subordinated Notes due 2008
 (CUSIP                    )
	 
	 	 	 	 
	

	 	(B)
	 	Deposit Date:                                                                                                                                                                   
	 
	 	 	 	 
	

	 	(C)
	 	Conversion Date:    
                           
                                                                                                                           
	 
	 	 	 	 
	2.

	 	(A)
	 	Aggregate principal amount of
Securities deposited for conversion:       
                                                                    
	 
	 	 	 	 
	

	 	(B)
	 	Conversion Price on Conversion Date:                                                                                                                          
	 
	 	 	 	 
	

	 	(C)
	 	Number of ADSs deliverable:
                            
                                                                                                          
	

	 	 	 	(disregard fractions)
	 
	 	 	 	 
	

	 	(D)
	 	Number of Restricted ADSs
deliverable:                                                                                                                       
	

	 	 	 	(disregard fractions)
	 
	 	 	 	 
	N.B.

	 	 
	 	The Conversion Agent must complete items 1 and 2.
	 
	 	 	 	 
	

	 	 	 	Upon receipt, a copy of this Conversion Notice shall be forwarded to:







	 	 	 	 	 
	

	 	a)
	 	Citibank, N.A.
	

	 	 	 	ADR Department
	

	 	 	 	15th Floor
	

	 	 	 	111 Wall Street
	

	 	 	 	New York, New York 10043
	

	 	 	 	Attn: Rosanne Devonshire
	

	 	 	 	Facsimile No: (212) 825-2029
	 
	 	 	 	 
	

	 	b)
	 	Citibank N.A. – Singapore
	

	 	 	 	300 Tampines Avenue 5
	

	 	 	 	#07-00 Tampines Junction
	

	 	 	 	Singapore, 529653
	

	 	 	 	Facsimile No.: 011-65-6426-8661







                    Notwithstanding anything herein to the contrary, Ordinary Shares which
would be represented by a fraction of one ADS shall not be issuable by the
Company or deposited with the Custodian or the ADS Depositary.



A-17









 





OPTION TO ELECT REPURCHASE

UPON A CHANGE OF CONTROL




To: ChipPAC, Inc.




     The undersigned registered owner of this Security hereby irrevocably
acknowledges receipt of a notice from ChipPAC, Inc. (the “Company”) as to the
occurrence of a Change of Control, and requests and instructs the Company to
redeem the entire principal amount of this Security, or the portion thereof
(which is $1,000 or an integral multiple thereof) below designated, in
accordance with the terms of the Indenture referred to in this Security at the
Change of Control Purchase Price, together with accrued interest to, but
excluding, such date, to the registered Holder hereof.



	 	 	 	 	 
	Date:
	 	 	 	 
	

	 	

	 	

	

	 	 	 	Signature(s)
	 
	 	 	 	 
	

	 	 	 	Signature(s) must be guaranteed by a
qualified guarantor institution with membership in an
approved signature guarantee program
pursuant to Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended.
	 
	 	 	 	 
	

	 	 	 	

	

	 	 	 	Signature Guaranty







Principal amount to be redeemed (in an integral multiple of $1,000, if less
than all):









NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.



A-18









 








SCHEDULE OF EXCHANGES OF SECURITIES4




     The following exchanges, repurchases or conversions of a part of this
global Security have been made:



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Principal Amount	 	 	 	 	 	Amount of	 	Amount of
	 	 	 	 	of this Global	 	Authorized	 	Decrease in	 	Increase in
	 	 	 	 	Security Following	 	Signatory of	 	Principal Amount	 	Principal Amount
	Date of	 	Such Decrease (or	 	Securities	 	of this Global	 	of this Global
	Exchange
	 	Increase)
	 	Custodian
	 	Security
	 	Security










	4	 	 This schedule should be included only if the Security is a Global Security.




A-19









 










CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION

OF TRANSFER OF TRANSFER RESTRICTED SECURITIES5





	 	 	Re: 2.50% Convertible Subordinated Securities Due 2008 (the “Securities”) of ChipPAC, Inc.





     This certificate relates to $                    principal amount of Securities
owned in (check applicable box)



	 	 	 
	o book-entry or

	 	o definitive form by                                        (the “Transferor”).







     The Transferor has requested a Registrar or the Trustee to exchange or
register the transfer of such Securities.



     In connection with such request and in respect of each such Security, the
Transferor does hereby certify that the Transferor is familiar with transfer
restrictions relating to the Securities as provided in Section 2.08 of the
Indenture dated as of May 28, 2003, between ChipPAC, Inc. and U.S. Bank
National Association (the “Indenture”), and the transfer of such Security is
being made pursuant to an effective registration statement under the Securities
Act of 1933, as amended (the “Securities Act”) (check applicable box) or the
transfer or exchange, as the case may be, of such Security does not require
registration under the Securities Act because (check applicable box):



	 	 	 
	o

	 	Such Security is being transferred pursuant to an effective
registration statement under the Securities Act.
	 
	 	 
	o

	 	Such Security is being transferred to the Company.
	 
	 	 
	o

	 	Such Security is being transferred inside the United States to a
person the Transferor reasonably believes is a “qualified
institutional buyer” (as defined in Rule 144A or any successor
provision thereto (“Rule 144A”) under the Securities Act) that is
purchasing for its own account or for the account of a “qualified
institutional buyer”, in each case to whom notice has been given
that the transfer is being made in reliance on such Rule 144A, and
in each case in reliance on Rule 144A.
	 
	 	 
	o

	 	Such Security is being transferred outside the United States in an
offshore transaction within the meaning of Regulation S under the
Securities Act in compliance with Rule 904 under the Securities
Act.
	 
	 	 
	o

	 	Such Security is being transferred pursuant to and in compliance
with an exemption from the registration requirements under the
Securities Act in accordance with Rule 144 (or any successor
thereto) (“Rule 144”) under the Securities Act.













	5	 	This certificate should only be included if this Security is a Transfer Restricted Security.




A-20









 










	 	 	 
	o

	 	Such Security is being transferred pursuant to and in compliance
with an exemption from the registration requirements of the
Securities Act (other than an exemption referred to above) and as a
result of which such Security will, upon such transfer, cease to be
a “restricted security” within the meaning of Rule 144 under the
Securities Act.







     The Transferor acknowledges and agrees that, if the transferee will hold
any such Securities in the form of beneficial interests in a Global Security
which is a “restricted security” within the meaning of Rule 144 under the
Securities Act, then such transfer can only be made pursuant to Rule 144A under
the Securities Act and such transferee must be a “qualified institutional
buyer” (as defined in Rule 144A).



	 	 	 	 	 
	Date:
	 	 	 	 
	

	 	

	 	

	

	 	 	 	(Insert Name of Transferor)








A-21