Document:

Exhibit 10.1

 

CONFIDENTIAL TREATMENT REQUESTED BY
NXP B.V.

 

EXECUTION VERSION

 

 

€500,000,000

 

SECURED REVOLVING CREDIT AGREEMENT

 

Dated as of September 29, 2006

 

among

 

KASLION ACQUISITION B.V.,

 

NXP B.V.,

 

NXP FUNDING LLC, 

as the Borrowers

 

The Several Lenders 

from Time to Time Parties Hereto

 

MORGAN STANLEY SENIOR FUNDING, INC.,

as Administrative Agent and Global Collateral Agent

 

MORGAN STANLEY BANK INTERNATIONAL LIMITED, 

DEUTSCHE BANK AG, LONDON BRANCH

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
  as Joint Lead Arrangers and Joint
Bookrunners

 

DEUTSCHE BANK AG, LONDON BRANCH, 

as Syndication Agent

 

and

 

MERRILL LYNCH CAPITAL CORPORATION, 

as Documentation Agent

 

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.

  	
   

  	
  DEFINITIONS

  	
   

  	
  2

  
	
   

  	
  1.1.

  	
   

  	
  Defined
  Terms

  	
   

  	
  2

  
	
   

  	
  1.2.

  	
   

  	
  Other
  Interpretive Provisions

  	
   

  	
  58

  
	
   

  	
  1.3.

  	
   

  	
  Accounting
  Terms

  	
   

  	
  59

  
	
   

  	
  1.4.

  	
   

  	
  Rounding

  	
   

  	
  59

  
	
   

  	
  1.5.

  	
   

  	
  References
  to Agreements, Laws, Etc.

  	
   

  	
  59

  
	
   

  	
  1.6.

  	
   

  	
  Exchange
  Rates

  	
   

  	
  59

  
	
   

  	
  1.7.

  	
   

  	
  Liability
  of Co-Borrower

  	
   

  	
  59

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
   

  	
  AMOUNT
  AND TERMS OF CREDIT

  	
   

  	
  60

  
	
   

  	
  2.1.

  	
   

  	
  Commitments

  	
   

  	
  60

  
	
   

  	
  2.2.

  	
   

  	
  Minimum
  Amount of Each Borrowing; Maximum Number of Borrowings

  	
   

  	
  60

  
	
   

  	
  2.3.

  	
   

  	
  Notice
  of Borrowing

  	
   

  	
  61

  
	
   

  	
  2.4.

  	
   

  	
  Disbursement
  of Funds

  	
   

  	
  62

  
	
   

  	
  2.5.

  	
   

  	
  Repayment
  of Loans; Evidence of Debt

  	
   

  	
  62

  
	
   

  	
  2.6.

  	
   

  	
  Conversions
  and Continuations

  	
   

  	
  63

  
	
   

  	
  2.7.

  	
   

  	
  Pro Rata Borrowings

  	
   

  	
  64

  
	
   

  	
  2.8.

  	
   

  	
  Interest

  	
   

  	
  64

  
	
   

  	
  2.9.

  	
   

  	
  Interest
  Periods

  	
   

  	
  65

  
	
   

  	
  2.10.

  	
   

  	
  Increased
  Costs, Illegality, etc.

  	
   

  	
  66

  
	
   

  	
  2.11.

  	
   

  	
  Compensation

  	
   

  	
  68

  
	
   

  	
  2.12.

  	
   

  	
  Change
  of Lending Office

  	
   

  	
  69

  
	
   

  	
  2.13.

  	
   

  	
  Notice
  of Certain Costs

  	
   

  	
  69

  
	
   

  	
  2.14.

  	
   

  	
  Additional
  Alternative Currencies

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
   

  	
  LETTERS
  OF CREDIT

  	
   

  	
  71

  
	
   

  	
  3.1.

  	
   

  	
  Letters
  of Credit

  	
   

  	
  71

  
	
   

  	
  3.2.

  	
   

  	
  Letter
  of Credit Requests

  	
   

  	
  72

  
	
   

  	
  3.3.

  	
   

  	
  Letter
  of Credit Participations

  	
   

  	
  72

  
	
   

  	
  3.4.

  	
   

  	
  Agreement
  to Repay Letter of Credit Drawings

  	
   

  	
  75

  
	
   

  	
  3.5.

  	
   

  	
  Increased
  Costs

  	
   

  	
  76

  
	
   

  	
  3.6.

  	
   

  	
  New
  or Successor Letter of Credit Issuer

  	
   

  	
  77

  
	
   

  	
  3.7.

  	
   

  	
  Issuance
  By Affiliates

  	
   

  	
  78

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
   

  	
  FEES;
  COMMITMENTS

  	
   

  	
  78

  
	
   

  	
  4.1.

  	
   

  	
  Fees

  	
   

  	
  78

  
	
   

  	
  4.2.

  	
   

  	
  Voluntary
  Reduction of Commitments

  	
   

  	
  79

  
	
   

  	
  4.3.

  	
   

  	
  Mandatory
  Termination of Commitments

  	
   

  	
  80

  

 

i

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
   

  	
  PAYMENTS

  	
   

  	
  80

  
	
   

  	
  5.1.

  	
   

  	
  Voluntary
  Prepayments

  	
   

  	
  80

  
	
   

  	
  5.2.

  	
   

  	
  Mandatory
  Prepayments and Cash Collateral

  	
   

  	
  80

  
	
   

  	
  5.3.

  	
   

  	
  Method
  and Place of Payment

  	
   

  	
  82

  
	
   

  	
  5.4.

  	
   

  	
  Net
  Payments

  	
   

  	
  82

  
	
   

  	
  5.5.

  	
   

  	
  Computations
  of Interest and Fees

  	
   

  	
  84

  
	
   

  	
  5.6.

  	
   

  	
  Limit
  on Rate of Interest

  	
   

  	
  84

  
	
   

  	
  5.7.

  	
   

  	
  Currency
  Indemnity

  	
   

  	
  85

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
   

  	
  CONDITIONS
  PRECEDENT TO INITIAL BORROWING

  	
   

  	
  85

  
	
   

  	
  6.1.

  	
   

  	
  Credit
  Documents

  	
   

  	
  85

  
	
   

  	
  6.2.

  	
   

  	
  Acquisition
  Agreement

  	
   

  	
  86

  
	
   

  	
  6.3.

  	
   

  	
  Indebtedness

  	
   

  	
  86

  
	
   

  	
  6.4.

  	
   

  	
  Solvency
  Certificate

  	
   

  	
  86

  
	
   

  	
  6.5.

  	
   

  	
  Legal
  Opinions

  	
   

  	
  87

  
	
   

  	
  6.6.

  	
   

  	
  Closing
  Certificates

  	
   

  	
  87

  
	
   

  	
  6.7.

  	
   

  	
  Corporate
  Proceedings of Each Credit Party

  	
   

  	
  87

  
	
   

  	
  6.8.

  	
   

  	
  Corporate
  Documents

  	
   

  	
  87

  
	
   

  	
  6.9.

  	
   

  	
  Collateral

  	
   

  	
  87

  
	
   

  	
  6.10.

  	
   

  	
  Fees

  	
   

  	
  88

  
	
   

  	
  6.11.

  	
   

  	
  Bridge
  Loans and Senior Notes

  	
   

  	
  88

  
	
   

  	
  6.12.

  	
   

  	
  Know
  Your Customer

  	
   

  	
  88

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
   

  	
  CONDITIONS
  PRECEDENT TO ALL CREDIT EVENTS AND CERTAIN FUNDS

  	
   

  	
  88

  
	
   

  	
  7.1.

  	
   

  	
  No
  Default; Representations and Warranties

  	
   

  	
  88

  
	
   

  	
  7.2.

  	
   

  	
  Notice
  of Borrowing; Letter of Credit Request

  	
   

  	
  89

  
	
   

  	
  7.3.

  	
   

  	
  Certain
  Funds

  	
   

  	
  89

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
   

  	
  REPRESENTATIONS,
  WARRANTIES AND AGREEMENTS

  	
   

  	
  89

  
	
   

  	
  8.1.

  	
   

  	
  Organization;
  Powers

  	
   

  	
  90

  
	
   

  	
  8.2.

  	
   

  	
  Authorization

  	
   

  	
  90

  
	
   

  	
  8.3.

  	
   

  	
  Enforceability

  	
   

  	
  90

  
	
   

  	
  8.4.

  	
   

  	
  Governmental
  Approvals; Other Consents

  	
   

  	
  90

  
	
   

  	
  8.5.

  	
   

  	
  Federal
  Reserve Regulations

  	
   

  	
  91

  
	
   

  	
  8.6.

  	
   

  	
  Investment
  Company Act

  	
   

  	
  91

  
	
   

  	
  8.7.

  	
   

  	
  Use
  of Proceeds

  	
   

  	
  91

  
	
   

  	
  8.8.

  	
   

  	
  Solvency

  	
   

  	
  91

  
	
   

  	
  8.9.

  	
   

  	
  Financial
  Statements; No Material Adverse Effect

  	
   

  	
  91

  
	
   

  	
  8.10.

  	
   

  	
  Litigation

  	
   

  	
  92

  
	
   

  	
  8.11.

  	
   

  	
  No
  Default

  	
   

  	
  92

  
	
   

  	
  8.12.

  	
   

  	
  Ownership
  of Properties; Liens

  	
   

  	
  92

  
	
   

  	
  8.13.

  	
   

  	
  Environmental
  Compliance

  	
   

  	
  92

  
	
   

  	
  8.14.

  	
   

  	
  Taxes

  	
   

  	
  93

  
	
   

  	
  8.15.

  	
   

  	
  Subsidiaries;
  Equity Interests

  	
   

  	
  93

  

 

ii

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  8.16.

  	
   

  	
  No
  Material Misstatements

  	
   

  	
  93

  
	
   

  	
  8.17.

  	
   

  	
  Compliance
  With Laws

  	
   

  	
  93

  
	
   

  	
  8.18.

  	
   

  	
  Intellectual
  Property Licenses

  	
   

  	
  94

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
   

  	
  AFFIRMATIVE
  COVENANTS

  	
   

  	
  94

  
	
   

  	
  9.1.

  	
   

  	
  Financial
  Statements

  	
   

  	
  94

  
	
   

  	
  9.2.

  	
   

  	
  Certificates;
  Other Information

  	
   

  	
  96

  
	
   

  	
  9.3.

  	
   

  	
  Notices

  	
   

  	
  97

  
	
   

  	
  9.4.

  	
   

  	
  Payment
  of Obligations

  	
   

  	
  97

  
	
   

  	
  9.5.

  	
   

  	
  Preservation
  of Existence; Assets

  	
   

  	
  97

  
	
   

  	
  9.6.

  	
   

  	
  Maintenance
  of Properties

  	
   

  	
  98

  
	
   

  	
  9.7.

  	
   

  	
  Maintenance
  of Insurance

  	
   

  	
  98

  
	
   

  	
  9.8.

  	
   

  	
  Compliance
  with Laws

  	
   

  	
  98

  
	
   

  	
  9.9.

  	
   

  	
  Inspection
  Rights

  	
   

  	
  98

  
	
   

  	
  9.10.

  	
   

  	
  Use
  of Proceeds

  	
   

  	
  99

  
	
   

  	
  9.11.

  	
   

  	
  Guarantees
  by Holdings and Restricted Subsidiaries

  	
   

  	
  99

  
	
   

  	
  9.12.

  	
   

  	
  Additional
  Liens and Security Interests

  	
   

  	
  99

  
	
   

  	
  9.13.

  	
   

  	
  Further
  Assurances

  	
   

  	
  100

  
	
   

  	
  9.14.

  	
   

  	
  Insurance
  Endorsements

  	
   

  	
  101

  
	
   

  	
  9.15.

  	
   

  	
  Equal
  and Ratable Security

  	
   

  	
  101

  
	
   

  	
  9.16.

  	
   

  	
  Security
  Over Cash and Bank Accounts

  	
   

  	
  101

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
   

  	
  NEGATIVE
  COVENANTS

  	
   

  	
  102

  
	
   

  	
  10.1.

  	
   

  	
  Limitation
  on Indebtedness

  	
   

  	
  102

  
	
   

  	
  10.2.

  	
   

  	
  Limitation
  on Restricted Payments

  	
   

  	
  107

  
	
   

  	
  10.3.

  	
   

  	
  Limitation
  on Liens

  	
   

  	
  114

  
	
   

  	
  10.4.

  	
   

  	
  Limitation
  on Restrictions on Distributions from Restricted Subsidiaries

  	
   

  	
  115

  
	
   

  	
  10.5.

  	
   

  	
  Limitation
  on Sales of Assets and Subsidiary Stock

  	
   

  	
  117

  
	
   

  	
  10.6.

  	
   

  	
  Limitation
  on Affiliate Transactions

  	
   

  	
  121

  
	
   

  	
  10.7.

  	
   

  	
  Limitation
  on Business Activities of the Co-Borrower

  	
   

  	
  124

  
	
   

  	
  10.8.

  	
   

  	
  Limitation
  on Business Activities of Holdings

  	
   

  	
  124

  
	
   

  	
  10.9.

  	
   

  	
  Merger
  and Consolidation by the Company

  	
   

  	
  124

  
	
   

  	
  10.10.

  	
   

  	
  Merger
  and Consolidations by the Co-Borrower and Guarantors

  	
   

  	
  125

  
	
   

  	
  10.11.

  	
   

  	
  Impairment
  of Liens

  	
   

  	
  126

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 11.

  	
   

  	
  EVENTS
  OF DEFAULT

  	
   

  	
  127

  
	
   

  	
  11.1.

  	
   

  	
  Events
  of Default

  	
   

  	
  127

  
	
   

  	
  11.2.

  	
   

  	
  Clean-up
  Period

  	
   

  	
  129

  
	
   

  	
  11.3.

  	
   

  	
  Application
  of Funds

  	
   

  	
  130

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 12.

  	
   

  	
  THE
  AGENTS

  	
   

  	
  130

  
	
   

  	
  12.1.

  	
   

  	
  Appointment

  	
   

  	
  130

  
	
   

  	
  12.2.

  	
   

  	
  Delegation
  of Duties

  	
   

  	
  131

  
	
   

  	
  12.3.

  	
   

  	
  Exculpatory
  Provisions

  	
   

  	
  131

  
										

 

iii

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.4.

  	
   

  	
  Reliance
  by Agents

  	
   

  	
  132

  
	
   

  	
  12.5.

  	
   

  	
  Notice
  of Default

  	
   

  	
  132

  
	
   

  	
  12.6.

  	
   

  	
  Non-Reliance
  on Agents and Other Lenders

  	
   

  	
  132

  
	
   

  	
  12.7.

  	
   

  	
  Indemnification

  	
   

  	
  133

  
	
   

  	
  12.8.

  	
   

  	
  Agents
  in their Individual Capacity

  	
   

  	
  133

  
	
   

  	
  12.9.

  	
   

  	
  Successor
  Agents

  	
   

  	
  133

  
	
   

  	
  12.10.

  	
   

  	
  Withholding
  Tax and Deductions

  	
   

  	
  134

  
	
   

  	
  12.11.

  	
   

  	
  Administrative
  Agent May File Proofs of Claim

  	
   

  	
  134

  
	
   

  	
  12.12.

  	
   

  	
  Joint
  and Several Claims

  	
   

  	
  135

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 13.

  	
   

  	
  MISCELLANEOUS

  	
   

  	
  135

  
	
   

  	
  13.1.

  	
   

  	
  Professional
  Market Party Representations

  	
   

  	
  135

  
	
   

  	
  13.2.

  	
   

  	
  Amendments
  and Waivers

  	
   

  	
  136

  
	
   

  	
  13.3.

  	
   

  	
  Notices

  	
   

  	
  137

  
	
   

  	
  13.4.

  	
   

  	
  No
  Waiver; Cumulative Remedies

  	
   

  	
  138

  
	
   

  	
  13.5.

  	
   

  	
  Survival
  of Representations and Warranties

  	
   

  	
  138

  
	
   

  	
  13.6.

  	
   

  	
  Payment
  of Expenses and Taxes

  	
   

  	
  138

  
	
   

  	
  13.7.

  	
   

  	
  Successors
  and Assigns; Participations and Assignments

  	
   

  	
  139

  
	
   

  	
  13.8.

  	
   

  	
  Replacements
  of Lenders under Certain Circumstances

  	
   

  	
  143

  
	
   

  	
  13.9.

  	
   

  	
  Resignation
  as Letter of Credit Issuer upon Assignment

  	
   

  	
  143

  
	
   

  	
  13.10.

  	
   

  	
  Assignment
  to SPCs

  	
   

  	
  144

  
	
   

  	
  13.11.

  	
   

  	
  Adjustments;
  Set-off

  	
   

  	
  145

  
	
   

  	
  13.12.

  	
   

  	
  Counterparts

  	
   

  	
  145

  
	
   

  	
  13.13.

  	
   

  	
  Severability

  	
   

  	
  145

  
	
   

  	
  13.14.

  	
   

  	
  Integration

  	
   

  	
  145

  
	
   

  	
  13.15.

  	
   

  	
  GOVERNING
  LAW

  	
   

  	
  146

  
	
   

  	
  13.16.

  	
   

  	
  Submission
  to Jurisdiction; Waivers

  	
   

  	
  146

  
	
   

  	
  13.17.

  	
   

  	
  Acknowledgments

  	
   

  	
  146

  
	
   

  	
  13.18.

  	
   

  	
  WAIVERS OF JURY TRIAL

  	
   

  	
  147

  
	
   

  	
  13.19.

  	
   

  	
  Confidentiality

  	
   

  	
  147

  
	
   

  	
  13.20.

  	
   

  	
  Direct
  Website Communications

  	
   

  	
  147

  
	
   

  	
  13.21.

  	
   

  	
  USA
  PATRIOT Act

  	
   

  	
  149

  

 

iv

 

SCHEDULES

 

	
  Schedule 1.1 (a)

  	
   

  	
  Agreed Security Principles

  
	
  Schedule 1.1 (b)

  	
   

  	
  Commitments

  
	
  Schedule 1.1 (c)

  	
   

  	
  Compliance Certificate

  
	
  Schedule 1.1 (d)

  	
   

  	
  Mandatory Costs Formula

  
	
  Schedule 1.1 (e)

  	
   

  	
  Security Documents

  
	
  Schedule 6.12

  	
   

  	
  Post Closing Matters

  
	
  Schedule 8.10

  	
   

  	
  Litigation (except intellectual property litigation)

  
	
  Schedule 8.13

  	
   

  	
  Environmental Claims

  
	
  Schedule 8.15

  	
   

  	
  Subsidiaries

  
	
  Schedule 8.18

  	
   

  	
  Intellectual Property Litigation

  
	
  Schedule 9.2

  	
   

  	
  Company’s website

  
	
  Schedule 13.2

  	
   

  	
  Notices

  

 

	
  EXHIBITS

  
	
   

  
	
  Exhibit A

  	
   

  	
  Assignment and Acceptance

  
	
  Exhibit B

  	
   

  	
  Nature of Borrowing

  
	
  Exhibit C

  	
   

  	
  Letter of Credit Request

  
	
  Exhibit D

  	
   

  	
  Form of Closing Certificates

  
	
  Exhibit E

  	
   

  	
  Form of Promissory Note

  

 

v

 

CREDIT AGREEMENT
dated as of September 29, 2006, among KASLION ACQUISITION B.V. with its
corporate seat in Amsterdam, the Netherlands (“Holdings”), NXP B.V. with
its corporate seat in Eindhoven, the Netherlands (the “Company”), NXP
FUNDING LLC (the “Co-Borrower”), the lending institutions from time to
time parties hereto (each a “Lender” and, collectively, the “Lenders”),
MORGAN STANLEY SENIOR FUNDING, INC., as Administrative Agent (in such capacity,
the “Administrative Agent”) and Global Collateral Agent (in such
capacity, the “Global Collateral Agent”), MORGAN STANLEY BANK
INTERNATIONAL LIMITED, DEUTSCHE BANK SECURITIES INC. and MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED, as Joint Lead Arrangers (each, in such
capacity, a “Joint Lead Arranger”) and Joint Bookrunners (each, in such
capacity, a “Joint Bookrunner”), DEUTSCHE BANK SECURITIES INC., as
Syndication Agent (in such capacity, the “Syndication Agent”), and
MERRILL LYNCH CAPITAL CORPORATION, as Documentation Agent (in such capacity,
the “Documentation Agent”).

 

WHEREAS, pursuant to
the Stock Purchase Agreement (as amended from time to time in accordance
therewith, the “Acquisition Agreement”), dated as of September 29, 2006,
between Koninklijke Philips Electronics N.V. (the “Seller”) and
Holdings, Holdings will acquire (the “Acquisition”) all of the Capital
Stock of the Company. In connection with the Acquisition, the Seller will
acquire 19.9% of the equity interests in Holdings;

 

WHEREAS, to fund
the Acquisition, the Sponsors, Approved Equity Investors and the Seller will
contribute an amount in cash to Holdings in exchange for common and/or
preferred Stock (such contribution, the “Equity Investments”) in an
amount no less than €4,305 million, which cash will be paid by Holdings to the
Seller in exchange for 100% of the Capital Stock of the Company. Upon
consummation of the Acquisition the Sponsors and Approved Equity Investors
will, collectively, own 80.1% of the equity of Holdings and 19.9% of the equity
will be owned by the Seller;

 

WHEREAS,
immediately prior to and in connection with the Acquisition, certain
intercompany indebtedness of the Company and its Subsidiaries owed to the
Seller will be repaid (the “Refinancing”);

 

WHEREAS, to
consummate the transactions contemplated by the Refinancing, the Company will
borrow up to €1,500,000,000 and US$1,921,290,000 of senior secured increasing
rate bridge loans under the Secured Bridge Facility and up to €1,500,000,000 of
senior unsecured increasing rate bridge loans under the Unsecured Bridge
Facility. The borrowings under the Bridge Facilities are expected to be
refinanced (in whole or in part) through the issuance by the Company and the
Co-Borrower of approximately €3.0 billion of Senior Secured Notes (denominated
in Euro and Dollars) and approximately €1.5 billion of Senior Unsecured Notes
(denominated in Euro and Dollars) in a Rule 144A or other private placement
(the “Senior Notes Offering”);

 

WHEREAS, the
Borrowers have requested that the Lenders extend credit in the form of Loans
and Letters of Credit on the terms and subject to the conditions set forth in
this Agreement;

 

 

 

WHEREAS, the
proceeds of Loans will be used by the Borrowers on or after the Closing Date
for general corporate purposes (including permitted acquisitions) and Letters
of Credit will be used by the Borrowers for general corporate purposes; and

 

WHEREAS, the
Lenders and Letter of Credit Issuers are willing to make available to the
Borrowers Loans and Letter of Credit facilities upon the terms and subject to
the conditions set forth herein.

 

NOW, THEREFORE, in
consideration of the premises and the covenants and agreements contained
herein, the parties hereto hereby agree as follows:

 

SECTION 1.       Definitions

 

1.1.                  Defined Terms.
(a) As used herein, the following terms shall have the meanings specified in
this Section 1.1 unless the context otherwise requires:

 

“ABR” shall
mean, for any day, a rate per  annum (rounded upwards, if necessary, to
the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day or (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in the ABR due to a change in the Prime
Rate or the Federal Funds Effective Rate shall be effective as of the opening
of business on the effective day of such change in the Prime Rate or the
Federal Funds Effective Rate, respectively.

 

“ABR Loan”
shall mean each loan bearing interest at the rate provided in Section 2.8(a).

 

“Acquired
Indebtedness” means Indebtedness (a) of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary, or (b)
assumed in connection with the acquisition of assets from such Person, in each
case whether or not Incurred by such Person in connection with such Person
becoming a Restricted Subsidiary of the Company or such acquisition or (c) of a
Person at the time such Person merges with or into or consolidates or otherwise
combines with the Company or any Restricted Subsidiary. Acquired Indebtedness
shall be deemed to have been Incurred, with respect to clause (a) on the date
such Person becomes a Restricted Subsidiary and, with respect to clause (b) on
the date of consummation of such acquisition of assets and, with respect to
clause (c), on the date of the relevant merger, consolidation or other
combination.

 

“Acquisition”
shall have the meaning provided in the preamble to this Agreement.

 

“Acquisition
Agreement” shall have the meaning provided in the preamble to this
Agreement (including all exhibits and schedules thereto).

 

“Acquisition
Side Letter” means the letter dated as of September 29, 2006 between the
Seller and Holdings in relation to the completion of the Reorganization in
Russia and Germany.

 

2

 

“Additional
Alternative Currency” means any currency which is approved in accordance
with Section 2.14.

 

“Additional
Assets” means:

 

(a)                      any property
or assets (other than Indebtedness and Capital Stock) used or to be used by the
Company, a Restricted Subsidiary or otherwise useful in a Similar Business (it
being understood that capital expenditures on property or assets already used
in Similar Business or to replace any property or assets that are the subject
of such Asset Disposition shall be deemed an investment in Additional Assets);

 

(b)                     the Capital
Stock of a Person that is engaged in a Similar Business and becomes a
Restricted Subsidiary as a result of the acquisition of such Capital Stock by
the Company or a Restricted Subsidiary of the Company; or

 

(c)                      Capital
Stock constituting a minority interest in any Person that at such time is a
Restricted Subsidiary of the Company.

 

“Adjusted Total
Commitment” shall mean at any time the Total Commitment less the aggregate
Commitments of all Defaulting Lenders.

 

“Administrative
Agent’s Office” shall mean in respect of all Credit Events, the office of
the Administrative Agent located at 20 Cabot Square, Canary Wharf, London E14
4QW, or such other office as the Administrative Agent may hereafter designate
in writing as such to the other parties hereto.

 

“Administrative
Questionnaire” shall have the meaning provided in Section 13.7(b).

 

“Affiliate”
of any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with such
specified Person. For the purposes of this definition, “control” when
used with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms “controlling”
and “controlled” have meanings correlative to the foregoing. For the
avoidance of doubt, neither the Seller nor any of its subsidiaries, joint
ventures or operations shall be deemed to be an “Affiliate” of the Company or
any Restricted Subsidiary due solely to its ownership of Voting Stock of the
Company or the presence of its or their nominee on the Board of Directors of
the Company, in each case at the percentage level disclosed in the offering
memorandum relating to the Senior Notes Offering.

 

“Affiliate
Transactions” has the meaning given in Section 10.6(a).

 

“Agency Fee
Letter” means the letter entitled “Project Lion Administrative Agency Fee
Letter” dated as of August 15, 2006 between the Administrative Agent and the
Company.

 

3

 

“Agent Parties”
shall have the meaning provided in Section 13.20(c).

 

“Agents”
shall mean each Joint Lead Arranger, each Joint Bookrunner, the Administrative
Agent, each Collateral Agent, the Syndication Agent and the Documentation
Agent.

 

“Aggregate
Outstandings” shall have the meaning provided in Section 5.2(b).

 

“Agreed
Security Principles” means the principles set forth on Schedule 1.1(a) as
applied reasonably and in good faith by the Company.

 

“Alternative
Currency” means US Dollars, Sterling, Yen, Swiss Francs, Singapore Dollars
(subject to the Singapore Dollars Sublimit), HK Dollars (subject to the HK
Dollars Sublimit) or any Additional Alternative Currency.

 

“Applicable ABR
Margin” shall mean with respect to any ABR Loan (a) from the Closing Date
until the date which is six months after the Closing Date, 1.75% per annum, and (b) thereafter, the
applicable percentage per  annum set forth below based upon the
Status in effect on such date:

 

	
  Status

  	
   

  	
  Applicable ABR Margin for 

  ABR Loans

  	
   

  
	
  Level I Status

  	
   

  	
  1.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level II Status

  	
   

  	
  1.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level III Status

  	
   

  	
  1.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level IV Status

  	
   

  	
  1.00

  	
  %

  

 

“Applicable
EURIBOR Margin” shall mean with respect to a EURIBOR Loan (a) from the
Closing Date until the date which is six months after the Closing Date, 2.75% per annum, (b) thereafter, the applicable
percentage per  annum set forth below based upon the
Status in effect on such date:

 

	
  Status

  	
   

  	
  Applicable EURIBOR Margin for

  EURIBOR Loans

  	
   

  
	
  Level I Status

  	
   

  	
  2.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level II Status

  	
   

  	
  2.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level III Status

  	
   

  	
  2.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level IV Status

  	
   

  	
  2.00

  	
  %

  

 

“Applicable
LIBOR Margin” shall mean with respect to a LIBOR Loan (a) from the Closing
Date until the date which is six months after the Closing Date, 2.75% per  annum,

 

4

 

(b) thereafter, the
applicable percentage per  annum set forth below based upon the
Status in effect on such date:

 

	
  Status

  	
   

  	
  Applicable LIBOR Margin for

  LIBOR Loans

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Level I Status

  	
   

  	
  2.75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level II Status

  	
   

  	
  2.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level III Status

  	
   

  	
  2.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Level IV Status

  	
   

  	
  2.00

  	
  %

  

 

“Approved
Equity Investor” means any Person notified in writing by the Sponsors to
the Joint Lead Arrangers prior to the Closing Date and any vehicle established
for the benefit of management of the Company.

 

“Approved Fund”
shall have the meaning provided in Section 13.7.

 

“ASMC”
means Advanced Semiconductor Manufacturing Corporation of Shanghai and any
successor business thereto and their respective subsidiaries, assets and
businesses.

 

“Asset
Disposition” means any direct or indirect sale, lease (other than an
operating lease entered into in the ordinary course of business), transfer,
issuance or other disposition, or a series of related sales, leases (other than
operating leases entered into in the ordinary course of business), transfers,
issuances or dispositions that are part of a common plan, of shares of Capital
Stock of a Subsidiary (other than directors’ qualifying shares), property or
other assets (each referred to for the purposes of this definition as a “disposition”)
by the Company or any of its Restricted Subsidiaries, including any disposition
by means of a merger, consolidation or similar transaction. Notwithstanding the
preceding provisions of this definition, the following items shall not be
deemed to be Asset Dispositions:

 

(a)                      a
disposition by a Restricted Subsidiary to the Company or by the Company or a
Restricted Subsidiary to a Restricted Subsidiary;

 

(b)                     a disposition
of cash, Cash Equivalents, Temporary Cash Investments or Investment Grade
Securities;

 

(c)                      a disposition
of inventory or other assets in the ordinary course of business;

 

(d)                     a disposition
of obsolete, surplus or worn out equipment or other assets or equipment or
other assets that are no longer useful in the conduct of the business of the
Company and its Restricted Subsidiaries;

 

5

 

(e)                      transactions
permitted under Section 10.9 or 10.10 or a transaction that constitutes a
Change of Control;

 

(f)                        an
issuance of Capital Stock by a Restricted Subsidiary to the Company or to
another Restricted Subsidiary or as part of or pursuant to an equity incentive
or compensation plan approved by the Board of Directors;

 

(g)                     any
dispositions of Capital Stock, properties or assets in a single transaction or
series of related transactions with a fair market value (as determined in good
faith by the Company) of less than €30,000,000;

 

(h)                     any
Restricted Payment that is permitted to be made, and is made, under Section
10.2 and the making of any Permitted Payment or Permitted Investment or, solely
for purposes of Section 10.5(a)(iii), asset sales, the proceeds of which are
used to make such Restricted Payments or Permitted Investments;

 

(i)                         dispositions
in connection with Permitted Liens;

 

(j)                         dispositions
of receivables in connection with the compromise, settlement or collection
thereof in the ordinary course of business or in bankruptcy or similar
proceedings and exclusive of factoring or similar arrangements;

 

(k)                      the
licensing or sub-licensing of intellectual property or other general
intangibles and licenses, sub-licenses, leases or subleases of other property,
in each case, in the ordinary course of business;

 

(l)                         foreclosure,
condemnation or any similar action with respect to any property or other
assets;

 

(m)                   the sale or
discount (with or without recourse, and on customary or commercially reasonable
terms and for credit management purposes) of accounts receivable or notes
receivable arising in the ordinary course of business, or the conversion or
exchange of accounts receivable for notes receivable;

 

(n)                     any
disposition of Capital Stock, Indebtedness or other securities of an
Unrestricted Subsidiary (with the exception of Investments in Unrestricted
Subsidiaries acquired pursuant to clause (o) of the definition of Permitted
Investments);

 

(o)                     any
disposition of Capital Stock of a Restricted Subsidiary pursuant to an
agreement or other obligation with or to a Person (other than the Company or a
Restricted Subsidiary) from whom such Restricted Subsidiary was acquired, or
from whom such Restricted Subsidiary acquired its business and assets (having
been newly formed in connection with such acquisition), made as part of such
acquisition and in each case comprising all or a portion of the consideration
in respect of such sale or acquisition;

 

(p)                     any surrender
or waiver of contract rights or the settlement, release or surrender of
contract, tort or other claims of any kind;

 

6

 

(q)                     any
disposition of assets to a Person who is providing services related to such
assets, the provision of which have been or are to be outsourced by the Company
or any Restricted Subsidiary to such Person; provided,  however,
that the Board of Directors shall certify that in the opinion of the Board of
Directors, the outsourcing transaction will be economically beneficial to the
Company and its Restricted Subsidiaries (considered as a whole); provided,
further, that the fair market value of the assets disposed of, when
taken together with all other dispositions made pursuant to this clause (r),
does not exceed €50,000,000; and

 

(r)                        any
disposition with respect to property built, owned or otherwise acquired by the
Company or any Restricted Subsidiary pursuant to customary sale and lease-back
transactions, asset securitizations and other similar financings permitted by
this Agreement.

 

“Assignment and
Acceptance” shall mean an assignment and acceptance substantially in the
form of Exhibit A.

 

“Associate”
means (a) any Person engaged in a Similar Business of which the Company or its
Restricted Subsidiaries are the legal and beneficial owners of between 20% and
50% of all outstanding Voting Stock, (b) any joint venture entered into by the
Company or any Restricted Subsidiary of the Company and (c) until and unless
designated otherwise by the Company in a notice to the Administrative Agent,
Crolles.

 

“Authorized
Officer” shall mean, with respect to any Person, the President, the Chief
Executive Officer, the Chief Financial Officer, any Managing Director (if
authorized to act individually), the Treasurer or any other senior officer (or
two such officers if the Company so elects) of such Person authorized to
represent such Person and designated as such in writing to the Administrative
Agent by such Person.

 

“Available
Commitment” shall mean an amount equal to the excess, if any, of (a) the
amount of the Total Commitment over (b) the sum of (i) the aggregate principal
amount of all Loans then outstanding and (ii) the aggregate Letters of Credit
Outstanding at such time.

 

“Bank
Indebtedness” means any and all amounts, whether outstanding on the Closing
Date or Incurred after the Closing Date, payable under or in respect of any
Credit Facility and any related notes, security documents, letters of credit
and Guarantees and any net obligations under Hedging Obligations entered into
in connection with any Credit Facility, including principal, premium, if any,
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization at the rate specified therein whether or not a
claim for post filing interest is allowed in such proceedings), fees, charges,
expenses, reimbursement obligations, Guarantees and all other amounts payable
thereunder or in respect thereof.

 

“Base Currency”
means Euros.

 

7

 

“Base Currency
Equivalent” shall mean, on any date of determination, (a) with respect to
any amount denominated in the Base Currency, such amount, and (b) with respect
to any amount denominated in any Foreign Currency, the equivalent in the Base
Currency of such amount, determined by the Administrative Agent using the
applicable Exchange Rate,

 

“Board”
shall mean the Board of Governors of the Federal Reserve System of the United
States (or any successor).

 

“Board of
Directors” means (a) with respect to a Dutch Borrower or any Credit Party
organized or established under the laws of the Netherlands, its managing board;
(b) with respect to any corporation, the board of directors or managers, as
applicable, of the corporation, or any duly authorized committee thereof; (c)
with respect to any partnership, the board of directors or other governing body
of the general partner of the partnership or any duly authorized committee
thereof; and (d) with respect to any other Person, the board or any duly
authorized committee of such Person serving a similar function. Whenever any
provision requires any action or determination to be made by, or any approval
of, a Board of Directors, such action, determination or approval shall be
deemed to have been taken or made if approved by a majority of the directors
(excluding employee representatives, if any) on any such Board of Directors
(whether or not such action or approval is taken as part of a formal board
meeting or as a formal board approval).

 

“Borrower”
means a Dutch Borrower or the Co-Borrower.

 

“Borrowing”
shall mean the incurrence of one Type of Loan on a given date (or resulting
from conversions on a given date) having, in the case of LIBOR Loans or EURIBOR
Loans, the same Interest Period; provided that ABR Loans incurred
pursuant to Section 2.10(b) shall be considered part of any related Borrowing
of LIBOR Loans or EURIBOR Loans (as the case may be).

 

“Bridge Facility”
means the Secured Bridge Facility and/or the Unsecured Bridge Facility, as the
context requires.

 

“Bridge Lender”
means, at any time, a lender under a Bridge Facility at that time (and includes
such Lender as the holder of any exchange notes issued thereunder).

 

“Bridge Loan”
means a loan made under a Bridge Facility, including any Bridge Rollover Loan
and exchange notes issued in exchange for such loans pursuant to a Bridge
Facility.

 

“Bridge Period”
means any period during which a Bridge Loan (other than a Bridge Rollover Loan
or exchange note issued in respect thereof) is outstanding under a Bridge
Facility.

 

“Bridge
Rollover Loan” means a Bridge Loan which is outstanding after the first
anniversary of the closing under the Bridge Facilities.

 

8

 

“Business Day” means a day (other than a Saturday or Sunday) on
which banks are open for general business in London, United Kingdom and
Amsterdam, The Netherlands and:

 

(a)                      in relation to any date for payment or
purchase of a currency other than Euro, the principal financial centre of the
country of that currency; or

 

(b)                     in relation to any date for payment or
purchase of Euro, any day on which the Trans-European Automated Real-time Gross
Settlement Express Transfer (“TARGET”) payment system is open for the
settlement of payments.

 

“Capital Stock” of any Person means any and all shares of, rights
to purchase, warrants or options for, or other equivalents of or partnership or
other interests in (however designated), equity of such Person, including any
Preferred Stock, but excluding any debt securities convertible into such
equity.

 

“Capitalized Lease Obligations” means an obligation that is
required to be classified and accounted for as a capitalized lease for
financial reporting purposes on the basis of GAAP. The amount of Indebtedness
represented by such obligation will be the capitalized amount of such
obligation at the time any determination thereof is to be made as determined on
the basis of GAAP, and the Stated Maturity thereof will be the date of the last
payment of rent or any other amount due under such lease prior to the first
date such lease may be terminated without penalty.

 

“Cash Collateralize” has the meaning given in Section 5.2(c).

 

“Cash Equivalents” means:

 

(a)                      securities issued or directly and fully
Guaranteed or insured by the United States or Canadian governments, a member
state of the European Union, Switzerland or Norway or, in each case, any agency
or instrumentality of thereof (provided that the full faith and credit of such
country or such member state is pledged in support thereof), having maturities
of not more than two years from the date of acquisition;

 

(b)                     certificates of deposit, time deposits,
eurodollar time deposits, overnight bank deposits or bankers’ acceptances
having maturities of not more than one year from the date of acquisition
thereof issued by any Lender or by any bank or trust company (i) whose
commercial paper is rated at least “A-l” or the equivalent thereof by S&P
or at least “P-l” or the equivalent thereof by Moody’s (or if at the time
neither is issuing comparable ratings, then a comparable rating of another
Nationally Recognized Statistical Rating Organization) or (ii) (in the event
that the bank or trust company does not have commercial paper which is rated)
having combined capital and surplus in excess of €500,000,000;

 

9

 

(c)                      repurchase obligations with a term of not more
than 30 days for underlying securities of the types described in clauses (a)
and (b) entered into with any bank meeting the qualifications specified in
clause (b) above;

 

(d)                     commercial paper rated at the time of
acquisition thereof at least “A-2” or the equivalent thereof by S&P or “P-2”
or the equivalent thereof by Moody’s or carrying an equivalent rating by a
Nationally Recognized Statistical Rating Organization, if both of the two named
rating agencies cease publishing ratings of investments or, if no rating is
available in respect of the commercial paper, the issuer of which has an
equivalent rating in respect of its long-term debt, and in any case maturing
within one year after the date of acquisition thereof;

 

(e)                      readily marketable direct obligations issued
by any state of the United States of America, any province of Canada, any
member of the European Union, Switzerland or Norway or any political
subdivision thereof, in each case, having one of the two highest rating
categories obtainable from either Moody’s or S&P (or, if at the time,
neither is issuing comparable ratings, then a comparable rating of another
Nationally Recognized Statistical Rating Organization) with maturities of not
more than two years from the date of acquisition;

 

(f)                        Indebtedness or preferred stock issued by
Persons with a rating of “BBB-” or higher from S&P or “Baa3” or higher from
Moody’s (or, if at the time, neither is issuing comparable ratings, then a
comparable rating of another Nationally Recognized Statistical Rating
Organization) with maturities of 12 months or less from the date of
acquisition;

 

(g)                     bills of exchange issued in the United States,
Canada, a member state of the European Union, Switzerland, Norway or Japan
eligible for rediscount at the relevant central bank and accepted by a bank (or
any dematerialized equivalent);

 

(h)                     interests in any investment company, money
market or enhanced high yield fund which invests 95% or more of its assets in
instruments of the type specified in clauses (a) through (g) above; and

 

(i)                         for purposes of clause (b) of the definition
of “Asset Disposition”, the marketable securities portfolio owned by the
Company and its Subsidiaries on the Closing Date.

 

“Change in Law” shall mean (a) the adoption of any law, treaty,
order, policy, rule or regulation after the date of this Agreement, (b) any
change in any law, treaty, order, policy, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
date of this Agreement or (c) compliance by the Lender with any guideline,
request or directive issued or made after the date hereof by any central bank
or other governmental or quasi-governmental authority (whether or not having
the force of law).

 

10

 

“Change of Control” means:

 

(a)                      the Company becomes aware of (by way of a
report or any other filing pursuant to Section 13(d) of the Exchange Act,
proxy, vote, written notice or otherwise) any “person” or “group” of related persons
(as such terms are used in Sections 13(d) and 14(d) of the Exchange Act as in
effect on the Closing Date), other than one or more Permitted Holders, is or
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act as in effect on the Closing Date), directly or indirectly, of more
than 50% of the total voting power of the Voting Stock of the Company, provided
that for the purposes of this clause, (x) no Change of Control shall be deemed
to occur by reason of the Company becoming a Subsidiary of a Successor Parent
and (y) any Voting Stock of which any Permitted Holder is the “beneficial owner”
(as so defined) shall not be included in any Voting Stock of which any such
person or group is the “beneficial owner” (as so defined), unless that person
or group is not an affiliate of a Permitted Holder and has greater voting power
with respect to that Voting Stock;

 

(b)                     following the Initial Public Offering of the
Company or any Parent, during any period of two consecutive years, individuals
who at the beginning of such period constituted the majority of the directors
(excluding any employee representatives, if any) on the Board of Directors of
the Company or any Parent (together with any new directors whose election by
the majority of such directors on such Board of Directors of the Company or any
Parent or whose nomination for election by shareholders of the Company or any
Parent, as applicable, was approved by a vote of the majority of such directors
on the Board of Directors of the Company or any Parent then still in office who
were either directors at the beginning of such period or whose election or
nomination for election was previously so approved) ceased for any reason to
constitute the majority of the directors (excluding any employee
representatives, if any) on the Board of Directors of the Company or any
Parent, then in office; or

 

(c)                      the sale, lease, transfer, conveyance or other
disposition (other than by way of merger, consolidation or other business
combination transaction), in one or a series of related transactions, of all or
substantially all of the assets of the Company and its Restricted Subsidiaries
taken as a whole to a Person, other than a Restricted Subsidiary or one or more
Permitted Holders.

 

“Clean-up Period” has the meaning given in Section 11.2.

 

“Closing Date” shall mean the date on which the Administrative
Agent confirms in writing that the conditions precedent required to be
delivered pursuant to Section 6 have been satisfied or waived.

 

“Code” means the United States Internal Revenue Code of 1986, as
amended.

 

“Collateral” shall have the meaning provided in any Security
Document.

 

11

 

“Collateral
Agency Agreement” means the Collateral Agency Agreement dated as of the
date of this Agreement among the Collateral Agents, the Borrower, the Secured
Parties and the Guarantors.

 

“Collateral
Agent” means the Global Collateral Agent or the Taiwan Collateral Agent.

 

“Commitment”
shall mean, (a) with respect to each Lender that is a Lender on the date
hereof, the amount set forth opposite such Lender’s name on Schedule 1.1(b) as
such Lender’s “Commitment” and (b) in the case of any Lender that becomes a
Lender after the date hereof, the amount specified as such Lender’s “Commitment”
in the Assignment and Acceptance pursuant to which such Lender assumed a
portion of the Total Commitment, in each case of the same may be changed from
time to time pursuant to terms hereof. The aggregate amount of the Commitments
as of the Closing Date is €500,000,000.

 

“Commitment Fee
Rate” shall mean, with respect to the Available Commitment on any day (a)
from the Closing Date until the date which is six months after the Closing
Date, 0.50% per annum, and (b)
thereafter, the rate per  annum set forth below opposite the Status
in effect on such day:

 

	
  Status

  	
   

  	
  Commitment Fee Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Level A Status

  	
   

  	
  0.50

  	
  %

  
	
  Level B Status

  	
   

  	
  0.375

  	
  %

  

 

“Commitment
Letter” means the Commitment Letter dated as of August 3, 2006, between
Morgan Stanley Senior Funding, Inc., Morgan Stanley Bank International Limited,
Deutsche Bank Securities Inc., Deutsche Bank AG New York Branch, Deutsche Bank
AG Cayman Islands Branch, Deutsche Bank AG London Branch, Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Merrill Lynch Capital Corporation.

 

“Commitment
Percentage” shall mean at any time, for each Lender, the percentage
obtained by dividing 

(a) such Lender’s Commitment by (b) the aggregate amount of the Commitments, provided
that at any time when the Total Commitment shall have been terminated, each
Lender’s Commitment Percentage shall be its Commitment Percentage as in effect
immediately prior to such termination.

 

“Commodity
Hedging Agreements” means in respect of a Person any commodity purchase
contract, commodity futures or forward contract, commodities option contract or
other similar contract (including commodities derivative agreements or
arrangements), to which such Person is a party or a beneficiary.

 

“Communications”
shall have the meaning provided in 13.20(a).

 

“Compliance
Certificate” means a certificate in substantially the form set forth in
Schedule 1.1(c).

 

12

 

“Confidential
Information” shall have the meaning provided in Section 13.19.

 

“Consolidated
EBITDA” for any period means, without duplication, the Consolidated Net
Income for such period, plus the following to the extent deducted in
calculating such Consolidated Net Income:

 

(a)                      Fixed
Charges and items (D), (E) and (F) in clause (a) of the definition of
Consolidated Interest Expense;

 

(b)                     Consolidated
Income Taxes;

 

(c)                      consolidated
depreciation expense;

 

(d)                     consolidated
amortization expense;

 

(e)                      any
expenses, charges or other costs related to any Equity Offering, Investment,
acquisition (including one-time amounts paid in connection with the acquisition
or retention of one or more individuals comprising part of a management team
retained to manage the acquired business; provided that such payments
are made in connection with such acquisition and are consistent with the
customary practice in the industry at the time of such acquisition), disposition,
recapitalization or the Incurrence of any Indebtedness permitted by this
Agreement (in each case whether or not successful) (including any such fees,
expenses or charges related to the Transactions (including any expenses in
connection with related due diligence activities)), in each case, as determined
in good faith by an Officer of the Company;

 

(f)                        any
minority interest expense (whether paid or not) consisting of income
attributable to minority equity interests of third parties in such period;

 

(g)                     the amount of
management, monitoring, consulting and advisory fees and related expenses paid
in such period to the Permitted Holders to the extent permitted by Section
10.6; and

 

(h)                     other
non-cash charges, write-downs or items reducing Consolidated Net Income
(excluding any such non-cash charge, write-down or item to the extent it
represents an accrual of or reserve for cash charges in any future period) or
other items classified by the Company as special items less other non-cash
items of income increasing Consolidated Net Income (excluding any such non-cash
item of income to the extent it represents a receipt of cash in any future
period).

 

Notwithstanding
the foregoing, the provision for taxes and the depreciation, amortization,
non-cash items, charges and write-downs of a Restricted Subsidiary shall be
added to Consolidated Net Income to compute Consolidated EBITDA only to the
extent (and in the same proportion, including by reason of minority interests)
that the net income (loss) of such Restricted Subsidiary was included in
calculating Consolidated Net Income for the purposes of this definition.

 

13

 

“Consolidated
Income Taxes” means taxes or other payments, including deferred Taxes,
based on income, profits or capital (including without limitation withholding
taxes) and franchise taxes of any of the Company and its Restricted
Subsidiaries whether or not paid, estimated, accrued or required to be remitted
to any Governmental Authority.

 

“Consolidated
Interest Expense” means, with respect to any Person for any period, without
duplication, the sum of:

 

(a)                      consolidated
interest expense of such Person and its Restricted Subsidiaries for such
period, to the extent such expense was deducted (and not added back) in
computing Consolidated Net Income (including (i) amortization of original issue
discount resulting from the issuance of Indebtedness at less than par, (ii) all
commissions, discounts and other fees and charges owed with respect to letters
of credit or bankers acceptances, (iii) non-cash interest payments (but
excluding any non-cash interest expense attributable to the movement in the
mark to market valuation of Hedging Obligations or other derivative instruments
pursuant to GAAP), (iv) the interest component of Capitalized Lease
Obligations, and (v) net payments, if any, pursuant to interest rate Hedging
Obligations with respect to Indebtedness, and excluding (A) accretion or
accrual of discounted liabilities other than Indebtedness, (B) any expense
resulting from the discounting of any Indebtedness in connection with the
application of purchase accounting in connection with any acquisition, (C) any
additional interest pursuant to a registration rights agreement with respect to
the Bridge Loans or any securities, (D) amortization of deferred financing
fees, debt issuance costs, commissions, fees and expenses, (E) any expensing of
bridge, commitment and other financing fees, and (F) interest with respect to
Indebtedness of any direct or indirect parent of such Person appearing upon the
balance sheet of such Person solely by reason of push-down accounting under
GAAP; plus

 

(b)                     consolidated
capitalized interest of such Person and its Restricted Subsidiaries for such
period, whether paid or accrued; less

 

(c)                      interest
income for such period.

 

For purposes of
this definition, interest on a Capitalized Lease Obligation shall be deemed to
accrue at an interest rate reasonably determined by such Person to be the rate
of interest implicit in such Capitalized Lease Obligation in accordance with
GAAP.

 

“Consolidated
Leverage” means the sum of the aggregate outstanding Indebtedness of the
Company and its Restricted Subsidiaries (excluding Hedging Obligations except
to the extent provided in Section 10.1(g)(iii)).

 

“Consolidated
Leverage Ratio” means, as of any date of determination, the ratio of (a)
Consolidated Leverage at such date to (b) the aggregate amount of Consolidated
EBITDA for the period of the most recent four consecutive fiscal quarters
ending prior to the date of such determination for which internal consolidated
financial statements of the Company are available;

 

14

 

provided,
however, that for the purposes of calculating Consolidated EBITDA for
such period, if, as of such date of determination:

 

(i)                         since the
beginning of such period the Company or any Restricted Subsidiary has disposed
of any company, any business, or any group of assets constituting an operating
unit of a business (any such disposition, a “Sale”) or if the
transaction giving rise to the need to calculate the Consolidated Leverage Ratio
is such a Sale, Consolidated EBITDA for such period will be reduced by an
amount equal to the Consolidated EBITDA (if positive) attributable to the
assets which are the subject of such Sale for such period or increased by an
amount equal to the Consolidated EBITDA (if negative) attributable thereto for
such period; provided that if any such Sale constitutes “discontinued
operations” in accordance with the then applicable GAAP, Consolidated Net
Income shall be reduced by an amount equal to the Consolidated Net Income (if
positive) attributable to such operations for such period or increased by an
amount equal to the Consolidated Net Income (if negative) attributable thereto
for such period;

 

(ii)                      since the
beginning of such period, the Company or any Restricted Subsidiary (by merger
or otherwise) has made an Investment in any Person that thereby becomes a
Restricted Subsidiary, or otherwise has acquired any company, any business, or
any group of assets constituting an operating unit of a business (any such
Investment or acquisition, a “Purchase”), including any such Purchase
occurring in connection with a transaction causing a calculation to be made
hereunder, Consolidated EBITDA for such period will be calculated after giving pro
forma effect thereto as if such Purchase occurred on the first day of
such period; and

 

(iii)                   since the
beginning of such period, any Person (that became a Restricted Subsidiary or
was merged or otherwise combined with or into the Company or any Restricted
Subsidiary since the beginning of such period) will have made any Sale or any
Purchase that would have required an adjustment pursuant to clause (i) or (ii)
above if made by the Company or a Restricted Subsidiary since the beginning of
such period, Consolidated EBITDA for such period will be calculated after
giving pro  forma effect thereto as if such Sale or Purchase
occurred on the first day of such period.

 

For the purposes
of this definition and the definitions of Consolidated EBITDA, Consolidated
Income Taxes, Consolidated Interest Expense and Consolidated Net Income, (a)
calculations will be as determined in good faith by a responsible financial or
chief accounting officer of the Company (including in respect of cost savings
and synergies) and (b) in determining the amount of Indebtedness outstanding on
any date of determination, pro  forma effect shall be given to any
Incurrence, repayment, repurchase, defeasance or other acquisition, retirement
or discharge of Indebtedness as if such transaction had occurred on the first
day of the relevant period.

 

“Consolidated
Net Income” means, for any period, the net income (loss) of the Company and
its Restricted Subsidiaries determined on a consolidated basis on the basis of
GAAP; provided, however, that there will not be included in such
Consolidated Net Income:

 

15

 

(a)                      subject to
the limitations contained in clause (c) below, any net income (loss) of any
Person if such Person is not a Restricted Subsidiary, except that the Company’s
equity in the net income of any such Person for such period will be included in
such Consolidated Net Income up to the aggregate amount of cash or Cash
Equivalents actually distributed by such Person during such period to the
Company or a Restricted Subsidiary as a dividend or other distribution or return
on investment or could have been distributed, as reasonably determined by an
Officer of the Company (subject, in the case of a dividend or other
distribution or return on investment to a Restricted Subsidiary, to the
limitations contained in clause (b) below);

 

(b)                     solely for
the purpose of determining the amount available for Restricted Payments under
Section 10.2(a)(iv)(C)(1), any net income (loss) of any Restricted Subsidiary
(other than Guarantors) if such Subsidiary is subject to restrictions, directly
or indirectly, on the payment of dividends or the making of distributions by
such Restricted Subsidiary, directly or indirectly, to the Company or a
Guarantor by operation of the terms of such Restricted Subsidiary’s charter or
any agreement, instrument, judgment, decree, order, statute or governmental
rule or regulation applicable to such Restricted Subsidiary or its shareholders
(other than (i) restrictions that have been waived or otherwise released, (ii)
restrictions pursuant to this Agreement, any Bridge Facility, any exchange
notes issued in exchange for any Bridge Loans, the Senior Notes or any Note
Indenture, and (iii) restrictions specified in Section 10.4(b)(xi)), except
that the Company’s equity in the net income of any such Restricted Subsidiary
for such period will be included in such Consolidated Net Income up to the
aggregate amount of cash or Cash Equivalents actually distributed or that could
have been distributed by such Restricted Subsidiary during such period to the
Company or another Restricted Subsidiary as a dividend or other distribution
(subject, in the case of a dividend to another Restricted Subsidiary, to the
limitation contained in this clause);

 

(c)                      any net gain
(or loss) realized upon the sale or other disposition of any asset or disposed
operations of the Company or any Restricted Subsidiaries (including pursuant to
any sale/leaseback transaction) which is not sold or otherwise disposed of in
the ordinary course of business (as determined in good faith by an Officer or
the Board of Directors of the Company);

 

(d)                     any
extraordinary, exceptional, unusual or nonrecurring gain, loss or charge or any
charges or reserves in respect of any restructuring, redundancy or severance or
any expenses, charges, reserves or other costs related to the Transactions
(including (i) in relation to expenses relating to consulting or operational
improvement initiatives, (iii) expenses associated with the closing out of
existing management equity programs and (iii) start-up and transaction costs);

 

(e)                      the
cumulative effect of a change in accounting principles;

 

(f)                        any
non-cash compensation charge or expense arising from any grant of stock, stock
options or other equity based awards and any non-cash deemed finance charges in
respect of any pension liabilities or other provisions;

 

16

 

(g)                     all deferred
financing costs written off and premiums paid or other expenses incurred
directly in connection with any early extinguishment of Indebtedness and any
net gain (loss) from any write-off or forgiveness of Indebtedness;

 

(h)                     any
unrealized gains or losses in respect of Hedging Obligations or any
ineffectiveness recognized in earnings related to qualifying hedge transactions
or the fair value of changes therein recognized in earnings for derivatives
that do not qualify as hedge transactions, in each case, in respect of Hedging
Obligations;

 

(i)                         any
unrealized foreign currency transaction gains or losses in respect of
Indebtedness of any Person denominated in a currency other than the functional
currency of such Person and any unrealized foreign exchange gains or losses
relating to translation of assets and liabilities denominated in foreign
currencies;

 

(j)                         any
unrealized foreign currency translation or transaction gains or losses in
respect of Indebtedness or other obligations of the Company or any Restricted
Subsidiary owing to the Company or any Restricted Subsidiary;

 

(k)                      the purchase
accounting effects including, but not limited to, adjustments to inventory,
property and equipment, software and other intangible assets and deferred
revenue in component amounts required or permitted by GAAP and related
authoritative pronouncements (including the effects of such adjustments pushed
down to the Company and the Restricted Subsidiaries), as a result of the
Transactions or the disentanglement, any consummated acquisition, or the
amortization or write-off of any amounts thereof (including any write-off of in
process research and development);

 

(1)                      any goodwill
or other intangible asset impairment charge or write-off;

 

(m)                   solely for the
purpose of determining the amount available for Restricted Investments (but not
other Restricted Payments) under Section 10.2(a)(iv)(C)(1): (i) only to the
extent not otherwise added back to Consolidated Net Income, depreciation and
amortization expense to the extent in excess of capital expenditures on
property, plant and equipment and (ii) Consolidated Income Taxes to the extent
in excess of cash payments made in respect of such Consolidated Income Taxes;
and

 

(n)                     the impact of
capitalized, accrued or accreting or pay-in-kind interest or principal on
Subordinated Shareholder Funding.

 

“Consolidated
Secured Leverage Ratio” means the Consolidated Leverage Ratio, but (a)
calculated by excluding all Indebtedness other than Secured Indebtedness
(except Secured Indebtedness Incurred pursuant to Section 10.1(b)(xiii) and
secured only by assets in the applicable jurisdiction but, for the avoidance of
doubt, including Indebtedness secured by Liens permitted under clause (u) of
the definition of “Permitted Liens”) and (b) calculating Consolidated
EBITDA for the purposes of such definition as though (i) consolidated
depreciation expense included such expense of the Company and its consolidated
Subsidiaries attributable to

 

17

 

SSMC and Jilin and (ii)
consolidated amortization expense included such expense of the Company and its
consolidated Subsidiaries attributable to SSMC and Jilin.

 

“Contingent Obligations” means, with respect to any Person, any
obligation of such Person guaranteeing in any manner, whether directly or
indirectly, any operating lease, dividend or other obligation that does not
constitute Indebtedness (“primary obligations”) of any other Person (the
“primary obligor”), including any obligation of such Person, whether or
not contingent:

 

(a)                      to purchase any such primary obligation or any
property constituting direct or indirect security therefor;

 

(b)                     to advance or supply funds:

 

(i)                         for the purchase or payment of any such
primary obligation; or

 

(ii)                      to maintain the working capital or equity capital of the primary obligor
or otherwise to maintain the net worth or solvency of the primary obligor; or

 

(c)                      to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation against loss in respect thereof.

 

“Credit Documents” shall mean this Agreement, the Security
Documents, the Guaranty (including any supplement thereto), each Letter of
Credit and any promissory notes issued by any Borrower hereunder.

 

“Credit Event” shall mean and include the making (but not the
conversion or continuation) of a Loan or the issuance of a Letter of Credit.

 

“Credit Exposure” shall mean, with respect to any Lender at any
time, the sum of (a) the aggregate principal amount of the Loans of such Lender
then outstanding and (b) such Lender’s Letter of Credit Exposure at such time.

 

“Credit Facility” means, with respect to the Company or any of
its Subsidiaries, one or more debt facilities, indentures or other arrangements
(including this Agreement or commercial paper facilities and overdraft
facilities) with banks, other financial institutions or investors providing for
revolving credit loans, term loans, notes, receivables financing (including
through the sale of receivables to such institutions or to special purpose
entities formed to borrow from such institutions against such receivables),
letters of credit or other Indebtedness, in each case, as amended, restated,
modified, renewed, refunded, replaced, restructured, refinanced, repaid,
increased or extended in whole or in part from time to time (and whether in
whole or in part and whether or not with the original administrative agent and
lenders or another administrative agent or agents or other banks or
institutions and whether provided under this Agreement or one or more other
credit or other agreements, indentures, financing agreements or otherwise) and
in each case including all agreements, instruments and documents executed and

 

18

 

delivered pursuant to or
in connection with the foregoing (including any notes and letters of credit
issued pursuant thereto and any Guarantee and collateral agreement, patent and
trademark security agreement, mortgages or letter of credit applications and
other Guarantees, pledges, agreements, security agreements and security
documents). Without limiting the generality of the foregoing, the term “Credit
Facility” shall include any agreement or instrument (a) changing the
maturity of any Indebtedness Incurred thereunder or contemplated thereby, (b)
adding Subsidiaries of the Company as additional borrowers or guarantors
thereunder, (c) increasing the amount of Indebtedness Incurred thereunder or
available to be borrowed thereunder or (d) otherwise altering the terms and
conditions thereof.

 

“Credit Party” shall mean each Borrower, each Guarantor or any
other Subsidiary of the Company that is a party to a Credit Document.

 

“Crolles” means the alliance operated by or to be operated by the
Company and its Restricted Subsidiaries (and assets owned by the Company and
its Restricted Subsidiaries that are deployed in such alliance, and activities
undertaken by any of them as part of such alliance, shall be deemed to be a
part of Crolles) and any successor thereto.

 

“Currency Agreement” means in respect of a Person any foreign
exchange contract, currency swap agreement, currency futures contract, currency
option contract, currency derivative or other similar agreement to which such
Person is a party or beneficiary.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United
States, and all other liquidation, conservatorship, bankruptcy, assignment for
the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights
of creditors generally (including, in the case of Credit Parties incorporated
or organized in England or Wales, administration, administrative receivership,
voluntary arrangement and schemes of arrangement).

 

“Default” shall mean any event, act or condition that with notice
or lapse of time, or both, would constitute an Event of Default.

 

“Defaulting Lender” shall mean any Lender with respect to which a Lender Default is in
effect.

 

“Designated Non-Cash Consideration” means the fair market value (as determined
in good faith by the Company) of non-cash consideration received by the Company
or one of its Restricted Subsidiaries in connection with an Asset Disposition
that is designated as Designated Non-Cash Consideration pursuant to an Officer’s
Certificate, setting forth the basis of such valuation, less the amount of
cash, Cash Equivalents or Temporary Cash Investments received in connection
with a subsequent payment, redemption, retirement, sale or other disposition of
such Designated Non-Cash Consideration. A particular item of Designated
Non-Cash Consideration will no longer be considered to be outstanding when and
to the extent it has been paid, redeemed or otherwise retired or sold or
otherwise disposed of in compliance with Section 10.5.

 

19

 

“Designated Preference Shares” means, with respect to the Company
or any Parent, Preferred Stock (other than Disqualified Stock) (a) that is
issued for cash (other than to the Company or a Subsidiary of the Company or an
employee stock ownership plan or trust established by the Company or any such
Subsidiary for the benefit of their employees to the extent funded by the
Company or such Subsidiary) and (b) that is designated as “Designated
Preference Shares” pursuant to an Officer’s Certificate of the Company at or
prior to the issuance thereof, the Net Cash Proceeds of which are excluded from
the calculation set forth in Section 10.2(a)(iv)(C)(2).

 

“Disinterested Director” means, with respect to any Affiliate
Transaction, a member of the Board of Directors of the Company having no
material direct or indirect financial interest in or with respect to such
Affiliate Transaction. A member of the Board of Directors of the Company shall
be deemed not to have such a financial interest by reason of such member’s
holding Capital Stock of the Company or any Parent or any options, warrants or
other rights in respect of such Capital Stock.

 

“Disqualified Stock” means, with respect to any Person, any
Capital Stock of such Person which by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable) or upon
the happening of any event:

 

(a)                      matures or is mandatorily redeemable for cash
or in exchange for Indebtedness pursuant to a sinking fund obligation or
otherwise;

 

(b)                     is convertible or exchangeable for
Indebtedness or Disqualified Stock (excluding Capital Stock which is
convertible or exchangeable solely at the option of the Company or a Restricted
Subsidiary); or

 

(c)                      is or may become (in accordance with its
terms) upon the occurrence of certain events or otherwise redeemable or
repurchasable for cash or in exchange for Indebtedness at the option of the
holder of the Capital Stock in whole or in part,

 

in each case on or prior
to the earlier of (i) the Stated Maturity of the Notes or (ii) the date on
which there are no Notes outstanding; provided, however, that (x)
only the portion of Capital Stock which so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option
of the holder thereof prior to such date will be deemed to be Disqualified
Stock and (y) any Capital Stock that would constitute Disqualified Stock solely
because the holders thereof have the right to require the Company to repurchase
such Capital Stock upon the occurrence of a change of control or asset sale
(howsoever defined or referred to) shall not constitute Disqualified Stock if
any such redemption or repurchase obligation is subject to compliance by the
relevant Person with Section 10.2.

 

“Dutch Banking Act” means the Credit System Supervision Act 1992 (Wet toezicht kredietwezen 1992).

 

“Dutch Borrower” means the Company or Holdings.

 

20

 

“Enforcement
Event” has the meaning given in the Collateral Agency Agreement.

 

“Environmental Claims” shall mean any and all actions, suits,
orders, decrees, demands, demand letters, claims, liens, notices of
noncompliance, violation or potential responsibility or investigation (other
than internal reports prepared by the Borrower or any of the Subsidiaries (a)
in the ordinary course of such Person’s business or (b) as required in
connection with a financing transaction or an acquisition or disposition of
real estate) or proceedings relating in any way to any Environmental Law or any
permit issued, or any approval given, under any such Environmental Law
(hereinafter, “Claims”), including, without limitation, (i) any and all
Claims by governmental or regulatory authorities for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law and (ii) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief relating to the presence, release or threatened release of
Hazardous Materials or arising from alleged injury or threat of injury to
health or safety (to the extent relating to human exposure to Hazardous
Materials), or the environment including, without limitation, ambient air,
surface water, groundwater, land surface and subsurface strata and natural
resources such as wetlands.

 

“Environmental Law” shall mean any applicable Federal, state,
foreign or local statute, Law, rule, regulation, ordinance, code and rule of
common law now or hereafter in effect and in each case as amended, and any
binding judicial or administrative interpretation thereof, including any
binding judicial or administrative order, consent decree or judgment, relating
to the protection of environment, including, without limitation, ambient air,
surface water, groundwater, land surface and subsurface strata and natural
resources such as wetlands, or human health or safety (to the extent relating
to human exposure to Hazardous Materials), or Hazardous Materials.

 

“Equity Investments” shall have the meaning provided in the
preamble to this Agreement.

 

“Equity Offering” means (a) a sale of Capital Stock of the
Company (other than Disqualified Stock) other than offerings registered on Form
S-8 (or any successor form) under the Securities Act or any similar offering in
other jurisdictions, or (b) the sale of Capital Stock or other securities, the
proceeds of which are contributed to the equity (other than through the issuance
of Disqualified Stock or Designated Preference Shares or through an Excluded
Contribution) of the Company or any of its Restricted Subsidiaries.

 

“Escrowed Proceeds” means the proceeds from the offering of any
debt securities or other Indebtedness paid into an escrow account with an
independent escrow agent on the date of the applicable offering or Incurrence
pursuant to escrow arrangements that permit the release of amounts on deposit
in such escrow account upon satisfaction of certain conditions or the occurrence
of certain events. The term “Escrowed Proceeds” shall include any
interest earned on the amounts held in escrow.

 

“EURIBOR Loan” means a loan bearing interest at the rate provided
in Section 2.8(c).

 

21

 

“EURIBOR Rate” shall mean, in the case of EURIBOR Loan, with
respect to each day during each Interest Period pertaining to such EURIBOR
Loan, the rate appearing on Telerate Page 248 at approximately 11:00 a.m.
(Brussels time) two Business Days prior to the commencement of such Interest
Period as the rate for deposits in the Base Currency with a maturity comparable
to such Interest Period. In the event that any such rate does not appear on the
applicable Page of the Telerate Service (or otherwise on such service), the “EURIBOR
Rate” for the purposes of this paragraph shall be determined by reference
to such other publicly available service for displaying EURIBOR rates as may be
agreed upon by the Administrative Agent and the Company or, in the absence of
such agreement, the “EURIBOR Rate” for the purposes of this paragraph
shall instead be the arithmetic mean of the rates per annum (rounded upwards to four decimal places) notified
to the Administrative Agent by the Reference Banks as the rate at which each
such Reference Bank quotes to leading banks in the Relevant Interbank Market
for Euro deposits at or about 11:00 a.m. (Brussels time) two Business Days
prior to the beginning of such Interest Period for a period comparable to such
Interest Period and an amount comparable to the amount of such EURIBOR Loan.

 

“Euro” and “€” means the lawful currency of Participating
Member States.

 

“European Government Obligations” means any security that is (a)
a direct obligation of Ireland, Belgium, the Netherlands, France, Germany or
any country that is a member of the European Monetary Union on the date of this
Agreement, for the payment of which the full faith and credit of such country
is pledged or (b) an obligation of a person controlled or supervised by and
acting as an agency or instrumentality of any such country the payment of which
is unconditionally Guaranteed as a full faith and credit obligation by such
country, which, in either case under the preceding clause (a) or (b), is not
callable or redeemable at the option of the Company thereof.

 

“Event of Default” shall have the meaning provided in Section 11.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder, as
amended.

 

“Exchange Rate” means (a) for the purposes of Section 10, the
spot rate for the purchase of the Base Currency with the applicable currency
other than Euro as published in The Financial Times in the “Currency Rates”
section (or, if The Financial Times is no longer published, or if such
information is no longer available in The Financial Times, such source as may
be selected in good faith by the Company) on the date of such determination, or
(b) for the purposes of determining the Base Currency Equivalent of the amount
of any Loan or the Stated Amount of any Letter of Credit as of any Revaluation
Date or US Dollar equivalent of any Loan on any date for the purposes of any
redenomination pursuant to Section 2.10(b), the rate at which such currency may
be exchanged into the Base Currency or US Dollars (as the case may be), as set
forth at approximately 11:00 a.m. on such day on the Reuters World Currency
Page for such currency; in the event that such rate does not appear on any
Reuters World Currency Page, the Exchange Rate shall be determined by reference
to such other publicly available service for displaying exchange rates as may
be agreed upon by the Administrative Agent and the Company, or, in the absence
of such agreement, such Exchange Rate shall instead be the arithmetic average

 

22

 

of the spot rates of
exchange of the Administrative Agent in the market where its foreign currency
exchange operations in respect of such currency are then being conducted, at or
about 11:00 a.m. on such date for the purchase of the Base Currency or US
Dollars (as the case may be) for delivery two Business Days later.

 

“Excluded Contribution” means Net Cash Proceeds or property or
assets received by the Company as capital contributions to the equity (other
than through the issuance of Disqualified Stock or Designated Preference
Shares) of the Company after the Closing Date or from the issuance or sale
(other than to a Restricted Subsidiary or an employee stock ownership plan or
trust established by the Company or any Subsidiary of the Company for the
benefit of its employees to the extent funded by the Company or any Restricted
Subsidiary) of Capital Stock (other than Disqualified Stock or Designated
Preference Shares) of the Company, in each case, to the extent designated as an
Excluded Contribution pursuant to an Officer’s Certificate of the Company and
to the extent not required to be used to prepay Loans or Cash Collateralize
Letters of Credit.

 

“Excluded Taxes” shall mean, with respect to any Agent, any
Lender or any Participant (a) (i) net income taxes and franchise taxes (imposed
in lieu of net income taxes) and capital taxes imposed on such Agent, such
Lender or such Participant and (ii) any taxes imposed on such Agent, such
Lender or such Participant as a result of such Agent, such Lender or such
Participant doing business in the jurisdiction of the Governmental Authority
imposing such tax or any political subdivision or taxing authority thereof or
therein (other than any such connection arising solely from such Agent, such
Lender or such Participant having executed, delivered or performed its
obligations or received a payment under, or having been a party to (or
participating in) or having enforced this Agreement or any other Credit
Document) and (b) in the case of a Lender not parry to this Agreement at the
Closing Date, (i) any withholding tax that is imposed on amounts payable to
such Lender by a Relevant Taxing Jurisdiction under the law in effect at the
time such Lender becomes a party to this Agreement (or, in the case of a
Participant not party to this Agreement at the Closing Date, on the date such
Participant became a Participant hereunder); provided that this clause
(b)(i) shall not apply to the extent that (x) the indemnity payments or
additional amounts any Lender (or Participant) would be entitled to receive
(without regard to this clause (b)(i)) do not exceed the indemnity payment or
additional amounts that the person making the assignment, participation or
transfer to such Lender (or Participant) would have been entitled to receive in
the absence of such assignment, participation or transfer or (y) any Tax is
imposed on a Lender in connection with an interest or participation in any Loan
or other obligation that such Lender was required to acquire pursuant to
Section 13.11 (a) or that such Lender acquired pursuant to Section 13.8 (it
being understood and agreed, for the avoidance of doubt, that any withholding
tax imposed on a Lender as a result of a Change in Law occurring after the time
such Lender became a party to this Agreement (or designates a new lending
office) shall not be an Excluded Tax), (ii) any Tax to the extent attributable
to such Lender’s failure to comply with Section 5.4(d) or (iii) any taxes
imposed as a result of the gross negligence or willful misconduct of any Agent
or Lender.

 

“Exemption Regulation to the Dutch Banking Act” means the
Exemption Regulation to the Dutch Banking Act (Vrijstellingsregeling
Wet toezicht Kredietwezen 1992)

 

23

 

dated 26 June 2002 of the
Minister of Finance of the Netherlands as promulgated in connection with the
Dutch Banking Act.

 

“fair market
value” may be conclusively established by means of an Officer’s Certificate
or a resolution of the Board of Directors of the Company setting out such fair
market value as determined by such Officer or such Board of Directors in good
faith.

 

“Federal Funds
Effective Rate” shall mean, for any day, the weighted average of the per annum rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average (rounded upward, if necessary, to a whole
multiple of 1/100 of 1%) of the quotations for the day of such transactions received
by the Administrative Agent from three federal funds brokers of recognized
standing selected by it.

 

“Fee Letter”
means the JLA Fee Letter or the Agency Fee Letter.

 

“Fees”
shall mean all amounts payable pursuant to, or referred to in, Section 4.1.

 

“Fixed Charge
Coverage Ratio” means, with respect to any Person on any determination
date, the ratio of (x) Consolidated EBITDA of such Person for the most recent
four consecutive fiscal quarters ending immediately prior to such determination
date for which internal consolidated financial statements are available to (y)
the Fixed Charges of such Person for such four consecutive fiscal quarters. In
the event that the Company or any Restricted Subsidiary Incurs, assumes,
guarantees, redeems, defeases, retires or extinguishes any Indebtedness (other
than Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) or issues
or redeems Disqualified Stock or Preferred Stock subsequent to the commencement
of the period for which the Fixed Charge Coverage Ratio is being calculated but
prior to or simultaneously with the event for which the calculation of the
Fixed Charge Coverage Ratio is made (the “Fixed Charge Coverage Ratio
Calculation Date”), then the Fixed Charge Coverage Ratio shall be
calculated giving pro  forma effect to such Incurrence,
assumption, guarantee, redemption, defeasance, retirement or extinguishment of
Indebtedness, or such issuance or redemption of Disqualified Stock or Preferred
Stock, as if the same had occurred at the beginning of the applicable
four-quarter period.

 

For purposes of
making the computation referred to above, any Investment, acquisitions,
dispositions, mergers, consolidations and disposed operations that have been
made by the Company or any of its Restricted Subsidiaries, including the
Transactions, during the four-quarter reference period or subsequent to such
reference period and on or prior to or simultaneously with the Fixed Charge
Coverage Ratio Calculation Date shall be calculated on a pro  forma
basis assuming that all such Investments, acquisitions, dispositions, mergers,
consolidations and disposed or discontinued operations (and the change in any
associated fixed charge obligations and the change in Consolidated EBITDA
resulting therefrom) had occurred on the first day of the four-quarter
reference period. If since the beginning of such period any Person that
subsequently became a Restricted Subsidiary or was merged with or into the

 

24

 

Company or any of its
Restricted subsidiaries since the beginning of such period shall have made any
Investment, acquisition, disposition, merger, consolidation or disposed or
discontinued operation that would have required adjustment pursuant to this definition,
then the Fixed Charge Coverage Ratio shall be calculated giving pro  forma
effect thereto for such period as if such Investment, acquisition, disposition,
merger, consolidation or disposed operation had occurred at the beginning of
the applicable four-quarter period.

 

For purposes of
this definition, whenever pro  forma effect is to be given to a
transaction, the pro  forma calculations shall be made in good
faith by a responsible financial or chief accounting officer of the Company
(including cost savings and synergies). If any Indebtedness bears a floating
rate of interest and is being given pro  forma effect, the
interest on such Indebtedness shall be calculated as if the rate in effect on
the Fixed Charge Coverage Ratio Calculation Date had been the applicable rate
for the entire period (taking into account any Hedging Obligations applicable
to such Indebtedness). Interest on a Capitalized Lease Obligation shall be
deemed to accrue at an interest rate reasonably determined by a responsible
financial or accounting officer of the Company to be the rate of interest
implicit in such Capitalized Lease Obligation in accordance with GAAP. For
purposes of making the computation referred to above, interest on any
Indebtedness under a revolving credit facility computed with a pro  forma
basis shall be computed based upon the average daily balance of such
Indebtedness during the applicable period except as set forth in the first
paragraph of this definition. Interest on Indebtedness that may optionally be
determined at an interest rate based upon a factor of a prime or similar rate,
a eurocurrency interbank offered rate, or other rate, shall be determined to
have been based upon the rate actually chosen, or if none, then based upon such
optional rate chosen as the Company may designate.

 

“Fixed Charges”
means, with respect to any Person for any period, the sum of:

 

(a)                      Consolidated
Interest Expense of such Person for such Period;

 

(b)                     all cash
dividends or other distributions paid (excluding items eliminated in consolidation)
on any series of Preferred Stock during such period; and

 

(c)                      all cash
dividends or other distributions paid (excluding items eliminated in
consolidation) on any series of Disqualified Stock during this period.

 

“Foreign
Currency” shall mean any currency other than the Base Currency.

 

“Fronting Fee”
shall have the meaning provided in Section 4.1(c).

 

“GAAP”
means generally accepted accounting principles in the United States of America
as in effect on the date of any calculation or determination required
hereunder. Except as otherwise set forth in this Agreement, all ratios and
calculations based on GAAP contained in this Agreement shall be computed in
accordance with GAAP. At any time after the Closing Date, the Company may elect
to establish that GAAP shall mean the GAAP as in effect on or prior to the date
of such election, provided that any such election, once made, shall be

 

25

 

irrevocable. The Company
shall give notice of either such election to the Administrative Agent and the
Lenders.

 

“Governmental
Authority” shall mean any nation, sovereign or government, any state,
province, territory or other political subdivision thereof, and any entity or
authority exercising executive, legislative, judicial, regulatory,
self-regulatory or administrative functions of or pertaining to government,
including a central bank or stock exchange.

 

“Guarantee”
means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person, including any such
obligation, direct or indirect, contingent or otherwise, of such Person:

 

(a)                      to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness of such other Person (whether arising by virtue of partnership
arrangements, or by agreements to keep-well, to purchase assets, goods,
securities or services, to take-or-pay or to maintain financial statement
conditions or otherwise); or

 

(b)                     entered into
primarily for purposes of assuring in any other manner the obligee of such Indebtedness
of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part);

 

provided,
however, that the term “Guarantee” will not include endorsements
for collection or deposit in the ordinary course of business. The term “Guarantee”
used as a verb has a corresponding meaning.

 

“Guarantor”
means each Restricted Subsidiary that Guarantees the obligations of the
Borrowers under this Agreement pursuant to the Guaranty.

 

“Guaranty”
means the Guaranty dated as of the date of this Agreement between the
Administrative Agent, the Taiwan Collateral Agent, Holdings, the Company and
each Guarantor (as supplemented from time to time).

 

“Hazardous
Materials” shall mean (a) any petroleum or petroleum products, radioactive
materials, friable asbestos, urea formaldehyde foam insulation, transformers or
other equipment that contain dielectric fluid containing regulated levels of
polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or
substances defined as or included in the definition of “hazardous substances”, “hazardous
waste”, “hazardous materials”, “extremely hazardous waste”, “restricted
hazardous waste”, “toxic substances”, “toxic pollutants”, “contaminants”, or “pollutants”,
or words of similar import, under any applicable Environmental Law; and (c) any
other chemical, material or substance, which is prohibited, limited or
regulated by any Environmental Law.

 

“Hedge
Agreement” shall mean an Interest Rate Agreement, Currency Agreement or
Commodity Hedging Agreement.

 

26

 

“Hedging
Obligations” of any Person means the obligations of such Person pursuant to
any Hedge Agreement.

 

“HK Dollars”
or “HK$” means the lawful currency of Hong Kong, the special
administrative region of the Republic of China.

 

“HK Dollars
Sublimit” means €250,000,000 (or its equivalent in HK Dollars).

 

“Holdings
Borrowing Limit” means an aggregate amount of €20,000,000 or its equivalent
in any Alternative Currency.

 

“Immaterial
Subsidiary” means any Restricted Subsidiary that (a) has not guaranteed any
other Indebtedness of a Borrower and (b) has Total Assets (as determined in
accordance with GAAP) and Consolidated EBITDA of less than 2.5% of the Company’s
Total Assets and Consolidated EBITDA measured, in the case of Total Assets, at
the end of the most recent fiscal period for which internal financial
statements are available and, in the case of Consolidated EBITDA, for the four
quarters ended most recently for which internal financial statements are
available, in each case measured on a pro  forma basis giving
effect to any acquisitions or dispositions of companies, division or lines of
business since such balance sheet date or the start of such four quarter
period, as applicable, and on or prior to the date of acquisition of such
subsidiary.

 

“Incur”
means issue, create, assume, enter into any Guarantee of, incur, extend or
otherwise become liable for; provided, however, that any Indebtedness or
Capital Stock of a Person existing at the time such Person becomes a Restricted
Subsidiary (whether by merger, consolidation, acquisition or otherwise) will be
deemed to be Incurred by such Restricted Subsidiary at the time it becomes a
Restricted Subsidiary and the terms “Incurred” and “Incurrence”
have meanings correlative to the foregoing and any Indebtedness pursuant to any
revolving credit or similar facility shall only be “Incurred” at the
time any funds are borrowed thereunder.

 

“Indebtedness”
means, with respect to any Person on any date of determination (without
duplication):

 

(a)                      the
principal of indebtedness of such Person for borrowed money;

 

(b)                     the principal
of obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;

 

(c)                      all
reimbursement obligations of such Person in respect of letters of credit,
bankers’ acceptances or other similar instruments (the amount of such
obligations being equal at any time to the aggregate then undrawn and unexpired
amount of such letters of credit or other instruments plus the aggregate amount
of drawings thereunder that have not been reimbursed) (except to the extent
such reimbursement obligations relate to trade payables and such obligations
are satisfied within 30 days of Incurrence);

 

27

 

(d)                     the principal
component of all obligations of such Person to pay the deferred and unpaid
purchase price of property (except trade payables), which purchase price is due
more than one year after the date of placing such property in service or taking
final delivery and title thereto;

 

(e)                      Capitalized
Lease Obligations of such Person;

 

(f)                        the
principal component of all obligations, or liquidation preference, of such
Person with respect to any Disqualified Stock or, with respect to any
Restricted Subsidiary, any Preferred Stock (but excluding, in each case, any
accrued dividends);

 

(g)                     the principal
component of all Indebtedness of other Persons secured by a Lien on any asset
of such Person, whether or not such Indebtedness is assumed by such Person; provided,
however, that the amount of such Indebtedness will be the lesser of (i)
the fair market value of such asset at such date of determination (as
determined in good faith by the Company) and (ii) the amount of such
Indebtedness of such other Persons;

 

(h)                     Guarantees by
such Person of the principal component of Indebtedness of other Persons to the
extent Guaranteed by such Person; and

 

(i)                         to the
extent not otherwise included in this definition, net obligations of such
Person under Currency Agreements and Interest Rate Agreements (the amount of
any such obligations to be equal at any time to the termination value of such
agreement or arrangement giving rise to such obligation that would be payable
by such Person at such time).

 

The term “Indebtedness”
shall not include Subordinated Shareholder Funding or any lease, concession or
license of property (or Guarantee thereof) which would be considered an
operating lease under GAAP as in effect on the Closing Date, any prepayments of
deposits received from clients or customers in the ordinary course of business,
or obligations under any license, permit or other approval (or Guarantees given
in respect of such obligations) Incurred prior to the Closing Date or in the
ordinary course of business.

 

The amount of
Indebtedness of any Person at any time in the case of a revolving credit or
similar facility shall be the total amounts of funds borrowed and then
outstanding and, in the case of letters of credit, bankers’ acceptances and
similar instruments, reimbursement obligations outstanding (to the extent such
obligations constitute Indebtedness under clause (c) above). The amount of
Indebtedness of any Person at any date shall be determined as set forth above
or otherwise provided in this Agreement, and (other than with respect to
letters of credit or Guarantees or Indebtedness specified in clause (g) or (h)
above) shall equal the amount thereof that would appear on a balance sheet of
such Person (excluding any notes thereto) prepared on the basis of GAAP.

 

Notwithstanding
the above provisions, in no event shall the following constitute Indebtedness:

 

(i)                         Contingent
Obligations Incurred in the ordinary course of business;

 

28

 

(ii)                      in
connection with the purchase by the Company or any Restricted Subsidiary of any
business, any post-closing payment adjustments to which the seller may become
entitled to the extent such payment is determined by a final closing balance
sheet or such payment depends on the performance of such business after the
closing; provided, however, that, at the time of closing, the
amount of any such payment is not determinable and, to the extent such payment
thereafter becomes fixed and determined, the amount is paid within 30 days
thereafter; or

 

(iii)                   for the
avoidance of doubt, any obligations in respect of workers’ compensation claims,
early retirement or termination obligations, pension fund obligations or
contributions or similar claims, obligations or contributions or social
security or wage Taxes.

 

“Indemnified
Taxes” shall mean all Taxes (other than Excluded Taxes) and Other Taxes.

 

“Independent
Financial Advisor” means an investment banking or accounting firm of
international standing or any third party appraiser of international standing; provided,
however, that such firm or appraiser is not an Affiliate of the Company.

 

“Initial
Investors” means (a) the Sponsors and funds or partnerships related,
managed or advised by any of them or any Affiliate of them, and (b) Koninklijke
Philips Electronics N.V. and its Subsidiaries.

 

“Initial Public
Offering” means an Equity Offering of common stock or other common equity
interests of the Company or any Parent or any successor of the Company or any
Parent (the “IPO Entity”) following which there is a Public Market and,
as a result of which, the shares of common stock or other common equity
interests of the IPO Entity in such offering are listed on an internationally
recognized exchange or traded on an internationally recognized market.

 

“Interest
Period” shall mean, with respect to any Loan, the interest period
applicable thereto, as determined pursuant to Section 2.9.

 

“Interest Rate
Agreement” means with respect to any Person any interest rate protection
agreement, interest rate future agreement, interest rate option agreement,
interest rate swap agreement, interest rate cap agreement, interest rate collar
agreement, interest rate hedge agreement or other similar agreement or
arrangement to which such Person is party or a beneficiary.

 

“Investment”
means, with respect to any Person, all investments by such Person in other
Persons (including Affiliates) in the form of any direct or indirect advance,
loan or other extensions of credit (other than advances or extensions of credit
to customers, suppliers, directors, officers or employees of any Person in the
ordinary course of business, and excluding any debt or extension of credit
represented by a bank deposit other than a time deposit) or capital
contribution to (by means of any transfer of cash or other property to others
or any payment for property or services for the account or use of others), or
the Incurrence of a Guarantee of any

 

29

 

obligation of, or any
purchase or acquisition of Capital Stock, Indebtedness or other similar
instruments issued by, such other Persons and all other items that are or would
be classified as investments on a balance sheet prepared on the basis of GAAP; provided,
however, that endorsements of negotiable instruments and documents in
the ordinary course of business will not be deemed to be an Investment. If the
Company or any Restricted Subsidiary issues, sells or otherwise disposes of any
Capital Stock of a Person that is a Restricted Subsidiary such that, after
giving effect thereto, such Person is no longer a Restricted Subsidiary, any
Investment by the Company or any Restricted Subsidiary in such Person remaining
after giving effect thereto will be deemed to be a new Investment at such time.

 

For purposes of
Section 10.2:

 

(a)                      “Investment”
will include the portion (proportionate to the Company’s equity interest in a
Restricted Subsidiary to be designated as an Unrestricted Subsidiary) of the
fair market value of the net assets of such Restricted Subsidiary of the
Company at the time that such Restricted Subsidiary is designated an
Unrestricted Subsidiary; provided, however, that upon a
redesignation of such Subsidiary as a Restricted Subsidiary, the Company will
be deemed to continue to have a permanent “Investment” in an
Unrestricted Subsidiary in an amount (if positive) equal to (i) the Company’s “Investment”
in such Subsidiary at the time of such redesignation less (ii) the portion
(proportionate to the Company’s equity interest in such Subsidiary) of the fair
market value of the net assets (as conclusively determined by the Board of
Directors of the Company in good faith) of such Subsidiary at the time that
such Subsidiary is so redesignated a Restricted Subsidiary; and

 

(b)                     any property
transferred to or from an Unrestricted Subsidiary will be valued at its fair
market value at the time of such transfer, in each case as determined in good
faith by the Board of Directors of the Company.

 

The amount of any
Investment outstanding at any time shall be the original cost of such
Investment, reduced (at the Company’s option) by any dividend, distribution,
interest, payment, return of capital, repayment or other amount or value
received in respect of such Investment.

 

“Investment
Grade Securities” means:

 

(a)                      securities
issued or directly and fully Guaranteed or insured by the United States or
Canadian government or any agency or instrumentality thereof (other than Cash
Equivalents);

 

(b)                     securities
issued or directly and fully guaranteed or insured by a member of the European
Union, or any agency or instrumentality thereof (other than Cash Equivalents);

 

(c)                      debt
securities or debt instruments with a rating of “A-” or higher from S&P or
“A3” or higher by Moody’s or the equivalent of such rating by such rating

 

30

 

organization or, if no
rating of Moody’s or S&P then exists, the equivalent of such rating by any
other Nationally Recognized Statistical Ratings Organization, but excluding any
debt securities or instruments constituting loans or advances among the Company
and its Subsidiaries; and

 

(d)                     investments
in any fund that invests exclusively in investments of the type described in
clauses (a), (b) and (c) above which fund may also hold cash and Cash
Equivalents pending investment or distribution.

 

“IPO Market
Capitalization” means an amount equal to (a) the total number of issued and
outstanding shares of common stock or common equity interests of the IPO Entity
at the time of closing of the Initial Public Offering multiplied by (b) the
price per share at which such shares of common stock or common equity interests
are sold in such Initial Public Offering.

 

“Jilin”
means Philips Jilin Semiconductors Co. Ltd.

 

“JLA Fee Letter”
means the letter entitled “Project Lion Fee Letter” dated as of August 3, 2006
between the Joint Lead Arrangers and the Company, as amended and restated as of
September 11, 2006.

 

“Law”
includes common or customary law, principles of equity and any constitution,
code of practice, decree, judgment, decision, legislation, order, ordinance,
regulation, by-law, statute, treaty or other legislative measure in any
jurisdiction or any present or future directive, regulation, guideline,
request, rule or requirement (in each case, whether or not having the force of
law but, if not having the force of law, the compliance with which is in
accordance with the general practice of persons to whom the directive,
regulation, guideline, request, rule or requirement is intended to apply) of
any Governmental Authority.

 

“L/C Advance”
means, with respect to each Lender, such Lender’s funding of its participation
in any L/C Borrowing in accordance with its Commitment Percentage pursuant to
Section 3.3(d). All L/C Advances shall be denominated in the currency in which
the relevant Letter of Credit is (or was) denominated.

 

“L/C Borrowing”
means any extension of credit resulting from a drawing under a Letter of Credit
which has not been reimbursed on the date when due or refinanced as a Loan.

 

“L/C Maturity
Date” shall mean the date that is five Business Days prior to the Maturity
Date.

 

“L/C
Participant” shall have the meaning provided in Section 3.3(a).

 

“L/C
Participation” shall have the meaning provided in Section 3.3(a).

 

“L/C Sublimit”
means €250,000,000.

 

“Legal Reservations”
means:

 

31

 

(a)                      the
principle that equitable remedies may be granted or refused at the discretion
of a court and the limitation of enforcement by laws relating to insolvency,
reorganization and other laws of any applicable jurisdiction generally affecting
the rights of creditors;

 

(b)                     the time
barring of claims under the applicable limitation laws, the possibility that an
undertaking to assume liability for or indemnify a person against non-payment
of stamp duty (or similar taxes) may be void and defences of set-off or
counterclaim; and

 

(c)                      any other
matters which are set out as qualifications or reservations as to matters of
law in the legal opinions referred to in Section 6 and delivered to the
Administrative Agent at the Closing Date or later delivered in connection with
the provision of any Guarantee or Lien under any Security Document.

 

“Lender”
shall have the meaning provided in the preamble to this Agreement.

 

“Lender Default”
shall mean (a) the failure (which has not been cured) of a Lender to make
available its portion of any Borrowing or to fund its portion of any
unreimbursed payment under Section 3.3, (b) a Lender having notified the
Administrative Agent and/or the Borrower that it does not intend to comply with
the obligations under Section 2. l(a) or 3.3 or (c) a Lender being deemed
insolvent or becoming the subject of a bankruptcy or insolvency proceeding.

 

“Letter of
Credit” has the meaning given in Section 3.1.

 

“Letter of
Credit Exposure” shall mean, with respect to any Lender, at any time, the
sum of (a) the amount of any Unpaid Drawings in respect of which such Lender
has made (or is required to have made) an L/C Advance to the Letter of Credit
Issuer pursuant to Section 3.3(c) at such time and (b) such Lender’s Commitment
Percentage of the Letters of Credit Outstanding at such time (excluding the
portion thereof consisting of Unpaid Drawings in respect of which the Lenders
have made (or are required to have made) payments to the Letter of Credit
Issuer pursuant to Section 3.4).

 

“Letter of
Credit Fee” shall have the meaning provided in Section 4.1(b).

 

“Letter of
Credit Issuer” shall mean (a) Morgan Stanley Senior Funding, Inc., (b)
Deutsche Bank AG, London Branch, (c) Bank of America, N.A., (d) HSBC Bank plc,
(e) BNP Paribas, (f) Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A., (g)
ABN AMRO Bank N.V., (h) any of their respective Affiliates, or (i) any
replacement, successor or new Letter of Credit Issuer appointed pursuant to
Section 3.6. Any Letter of Credit Issuer may, in its discretion, arrange for
one or more Letters of Credit to be issued by Affiliates of such Letter of
Credit Issuer, and in each such case the term “Letter of Credit Issuer”
shall include any such Affiliate with respect to Letters of Credit issued by
such Affiliate. In the event that there is more than one “Letter of Credit
Issuer” at any time, references herein and in the other Credit

 

32

 

Documents to the Letter
of Credit Issuer shall be deemed to refer to the Letter of Credit Issuer in
respect of the applicable Letter of Credit or to all Letter of Credit Issuers,
as the context requires.

 

“Letters of
Credit Outstanding” shall mean, at any time, the sum of, without
duplication, (a) the aggregate Stated Amount of all outstanding Letters of
Credit and (b) the aggregate amount of all Unpaid Drawings in respect of all
Letters of Credit.

 

“Letter of
Credit Request” shall have the meaning provided in Section 3.2.

 

“Level A Status”
shall exist on any date if the Net Leverage Ratio as of such date, or the most
recent determination date occurring prior to such date, is equal to or greater
than 3.00 to 1.00.

 

“Level B Status”
shall exist on any date if the Net Leverage Ratio as of such date, or the most
recent determination date occurring prior to such date, is less than 3.00 to
1.00.

 

“Level I Status”
shall exist on any date if the Net Leverage Ratio as of such date, or the most
recent determination date occurring prior to such date, is greater than 3.25 to
1.00.

 

“Level II
Status” shall exist on any date if Level I Status does not exist on such
date and the Net Leverage Ratio as of such date, or the most recent
determination date occurring prior to such date, is greater than or equal to
2.75 to 1.00 but less than or equal 3.25 to 1.00.

 

“Level III
Status” shall exist on any date if the Net Leverage Ratio is greater than
or equal to 2.25 to 1.00 but less than 2.75 to 1.00 as of such date.

 

“Level IV
Status” shall exist on any date if the Net Leverage Ratio as of such date,
or the most recent determination date occurring prior to such date, is less
than 2.25 to 1.00.

 

“LIBOR Loan”
shall mean any Loan bearing interest at the rate provided in Section 2.8(b).

 

“LIBOR Rate”
shall mean, in the case of any LIBOR Loan, with respect to each day during each
Interest Period pertaining to such LIBOR Loan, (a) the rate of interest
determined on the basis of the British Bankers’ Association Interest Settlement
Rate for the relevant currency for a period equal to such Interest Period
commencing on the first day of such Interest Period appearing on Page 3750 of
the Telerate screen as of 11:00 a.m. two Business Days prior to the beginning
of such Interest Period multiplied by (b) the Statutory Reserve Rate. In the
event that any such rate does not appear on the applicable Page of the Telerate
Service (or otherwise on such service), the “LIBOR Rate” for the
purposes of this paragraph shall be determined by reference to such other
publicly available service for displaying LIBOR rates as may be agreed upon by
the Administrative Agent and the Company or, in the absence of such agreement,
the “LIBOR Rate” for the purposes of this paragraph shall instead be the
arithmetic mean of the rates per annum (rounded
upwards to four decimal places) notified to the Administrative Agent by the
Reference Banks as the rate at which each such Reference Bank quotes to leading
banks in the Relevant Interbank Market for deposits in the relevant currency at
or about 11:00 a.m. two Business Days prior to the beginning of such Interest
Period for a period

 

33

 

comparable to such
Interest Period and an amount comparable to the amount of such LIBOR Loan.

 

“Lien”
means any mortgage, pledge, security interest, encumbrance, lien or charge of
any kind (including any conditional sale or other title retention agreement or
lease in the nature thereof).

 

“Loan”
shall mean any ABR Loan, EURIBOR Loan or LIBOR Loan made by any Lender
hereunder.

 

“Major Default”
means (a) any Credit Document is or becomes unenforceable or ineffective as
against a Borrower, or any Borrower repudiates any of its obligations under any
Credit Document, or it becomes illegal for any Borrower to perform any of its
obligations under any Credit Document, in any such case to an extent which is
or could reasonably be expected to be materially prejudicial to the interests
of the Lenders under the Credit Documents; or (b) any of the following Events
of Default with respect to the Borrowers only: (i) Section 11.1(a), (ii)
Section 11.l(b), (iii) Section 11.1 (h) insofar as it relates to a breach of
any Major Representation, or (iv) Section 11.1(g).

 

“Major
Representation” means a representation or warranty under any of Section 8.1
to 8.4 (inclusive).

 

“Management
Advances” means loans or advances made to, or Guarantees with respect to
loans or advances made to, directors, officers, employees or consultants of any
Parent, the Company or any Restricted Subsidiary:

 

(a)                      (i) in
respect of travel, entertainment or moving related expenses Incurred in the
ordinary course of business or (ii) for purposes of funding any such person’s
purchase of Capital Stock or Subordinated Shareholder Funding (or similar
obligations) of the Company, its Subsidiaries or any Parent with (in the case
of this sub-clause (ii)) the approval of the Board of Directors;

 

(b)                     in respect of
moving related expenses Incurred in connection with any closing or
consolidation of any facility or office; or

 

(c)                      not
exceeding €5,000,000 in the aggregate outstanding at any time.

 

“Management
Investors” means the officers, directors, employees and other members of
the management of or consultants to any Parent, the Company or any of their
respective Subsidiaries, or spouses, family members or relatives thereof, or
any trust, partnership or other entity for the benefit of or the beneficial
owner of which (directly or indirectly) is any of the foregoing, or any of
their heirs, executors, successors and legal representatives, who at any date
beneficially own or have the right to acquire, directly or indirectly, Capital
Stock of the Company, any Restricted Subsidiary or any Parent.

 

“Mandatory Cost”
means the percentage rate per annum calculated by the Administrative Agent in
accordance with Schedule 1.1(d).

 

34

 

“Market
Capitalization” means an amount equal to (a) the total number of issued and
outstanding shares of common stock or common equity interests of the IPO Entity
on the date of the declaration of the relevant dividend multiplied by (b) the
arithmetic mean of the closing prices per share of such common stock or common
equity interests for the 30 consecutive trading days immediately preceding the
date of declaration of such dividend.

 

“Material
Adverse Effect” means a material adverse effect on:

 

(a)                      the
consolidated business, assets or financial condition of the Company and its
Subsidiaries taken as a whole such that the Company and its Subsidiaries taken
as a whole would be reasonably likely to be unable to perform their payment
obligations under any of the Credit Documents; and/or

 

(b)                     subject to
the Legal Reservations and the Agreed Security Principles, the validity of any
security granted pursuant to the Credit Documents to which any Credit Party is
a party in any way which is materially adverse to the interests of the Lenders
under the Credit Documents taken as a whole and, without duplication of any
other cure period, if capable of remedy, not remedied within 20 Business Days
of Holdings becoming aware of the issue or being given notice of the issue by
the Administrative Agent.

 

“Maturity Date”
shall mean September 29, 2012, or, if such date is not a Business Day, the next
preceding Business Day.

 

“Minimum
Borrowing Amount” shall mean (a) with respect to a Borrowing of LIBOR Loans
or EURIBOR Loans, €1,000,000 and (b) with respect to a Borrowing of ABR Loans,
$500,000 or, in either case, its equivalent in any Alternative Currency.

 

“Moody’s”
means Moody’s Investors Service, Inc. or any of its successors or assigns that
is a Nationally Recognized Statistical Rating Organization.

 

“Nationally
Recognized Statistical Rating Organization” means a nationally recognized
statistical rating organization within the meaning of Rule 436 under the
Securities Act.

 

“Net Available
Cash” from an Asset Disposition means cash payments received (including any
cash payments received by way of deferred payment of principal pursuant to a
note or installment receivable or otherwise and net proceeds from the sale or
other disposition of any securities received as consideration, but only as and
when received, but excluding any other consideration received in the form of
assumption by the acquiring person of Indebtedness or other obligations
relating to the properties or assets that are the subject of such Asset
Disposition or received in any other non-cash form) therefrom, in each case net
of:

 

(a)                      all legal,
accounting, investment banking, title and recording tax expenses, commissions
and other fees and expenses Incurred, and all Taxes paid or required to be paid
or accrued as a liability under GAAP (after taking into account any available
tax

 

35

 

credits or deductions and
any tax sharing agreements), as a consequence of such Asset Disposition;

 

(b)                     all payments
made on any Indebtedness which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon such assets, or
which by applicable law be repaid out of the proceeds from such Asset
Disposition;

 

(c)                      all
distributions and other payments required to be made to minority interest
holders (other than any Parent, the Company or any of their respective
Subsidiaries) in Subsidiaries or joint ventures as a result of such Asset
Disposition; and

 

(d)                     the deduction
of appropriate amounts required to be provided by the seller as a reserve, on
the basis of GAAP, against any liabilities associated with the assets disposed
of in such Asset Disposition and retained by the Company or any Restricted
Subsidiary after such Asset Disposition.

 

“Net Cash
Proceeds” with respect to any issuance or sale of Capital Stock or
Subordinated Shareholder Funding, means the cash proceeds of such issuance or
sale net of attorneys’ fees, accountants’ fees, underwriters’ or placement
agents’ fees, listing fees, discounts or commissions and brokerage, consultant
and other fees and charges actually Incurred in connection with such issuance
or sale and net of taxes paid or payable as a result of such issuance or sale
(after taking into account any available tax credit or deductions and any tax sharing
arrangements).

 

“Net Leverage
Ratio” means, as of any date of determination, the ratio of (a)
Consolidated Leverage at such date minus the aggregate amount of cash
and Cash Equivalents, in each case which are free and clear of any Liens,
included on the most recent consolidated balance sheet of the Company and its
Restricted Subsidiaries delivered pursuant to Section 9.1, to (b) the aggregate
amount of Consolidated EBITDA for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such determination for
which internal consolidated financial statements of the Company are available
as adjusted in accordance with the proviso in the definition of “Consolidated
Leverage Ratio”.

 

“Non-Consenting
Lender” shall have the meaning provided in Section 13.20(b).

 

“Non-Defaulting
Lender” shall mean and include each Lender other than a Defaulting Lender.

 

“Note Indenture”
means the Secured Note Indenture or the Unsecured Note Indenture.

 

“Notice of
Borrowing” shall have the meaning provided in Section 2.3(a).

 

“Notice of
Conversion or Continuation” shall have the meaning provided in Section 2.6.

 

36

 

“Offer Letter”
means the irrevocable letter of offer dated as of August 3, 2006 between the
Sponsors and the Seller in relation to the Acquisition.

 

“Officer”
means, with respect to any Person, (a) the Chairman of the Board of Directors,
the Chief Executive Officer, the President, the Chief Financial Officer, any
Vice President, the Treasurer, any Managing Director (or any two Managing Directors
if elected by such Credit Party) or the Secretary (i) of such Person or (ii) if
such Person is owned or managed by a single entity, of such entity; or (b) any
other individual designated as an “Officer” for the purposes of this
Agreement by the Board of Directors of such Person.

 

“Officer’s
Certificate” means, with respect to any Person, a certificate signed by one
Officer (or two officers, if elected by such Person) of such Person.

 

“Opinion of
Counsel” means a written opinion from legal counsel reasonably satisfactory
to the Administrative Agent. The counsel may be an employee of or counsel to
the Company or its Subsidiaries.

 

“Other Taxes”
shall mean any and all present or future stamp, documentary or any other
excise, property or similar taxes (including interest, fines, penalties,
additions to tax and related expenses with regard thereto) arising directly
from any payment made or required to be made under this Agreement or from the
execution or delivery of, registration or enforcement of, consummation or
administration of, or otherwise with respect to, this Agreement or any other
Credit Document, other than any such taxes that arise from the assignment or
participation of any rights or obligations under this Agreement in accordance
with Section 13.7.

 

“Parent”
means any Person of which the Company at any time is or becomes a Subsidiary
after the Closing Date and any holding companies established by any Permitted
Holder for purposes of holding its investment in any Parent.

 

“Parent
Expenses” means:

 

(a)                      costs
(including all professional fees and expenses) Incurred by any Parent in
connection with reporting obligations under or otherwise Incurred in connection
with compliance with applicable laws, rules or regulations of any Governmental
Authority, this Agreement, the Bridge Facilities, the Senior Notes or any other
agreement or instrument relating to Indebtedness of the Company or any
Restricted Subsidiary, including in respect of any reports filed with respect
to the Securities Act, Exchange Act or the respective rules and regulations
promulgated thereunder;

 

(b)                     customary
indemnification obligations of any Parent owing to directors, officers,
employees or other Persons under its charter or by-laws or pursuant to written
agreements with any such Person to the extent relating to the Company and its
Subsidiaries;

 

(c)                      obligations
of any Parent in respect of director and officer insurance (including premiums
therefor) to the extent relating to the Company and its Subsidiaries;

 

37

 

(d)                     fees and
expenses payable by any Parent in connection with the Transactions;

 

(e)                      general
corporate overhead expenses, including (i) professional fees and expenses and
other operational expenses of any Parent related to the ownership or operation
of the business of the Company or any of its Restricted Subsidiaries or (ii)
costs and expenses with respect to any litigation or other dispute relating to
the Transactions;

 

(f)                        other
fees, expenses and costs relating directly or indirectly to activities of the
Company and its Subsidiaries in an amount not to exceed €5,000,000 in any
fiscal year; and

 

(g)                     expenses
Incurred by any Parent in connection with any public offering or other sale of
Capital Stock or Indebtedness:

 

(i)                         where the
net proceeds of such offering or sale are intended to be received by or
contributed to the Company or a Restricted Subsidiary,

 

(ii)                      in a
pro-rated amount of such expenses in proportion to the amount of such net
proceeds intended to be so received or contributed, or

 

(iii)                   otherwise on an
interim basis prior to completion of such offering so long as any Parent shall
cause the amount of such expenses to be repaid to the Company or the relevant
Restricted Subsidiary out of the proceeds of such offering promptly if
completed.

 

“Pari Passu
Indebtedness” means Indebtedness of the Company or any Guarantor if such
Indebtedness ranks equally in right of payment to the Loans or Unpaid Drawings
(or the Guaranty with respect thereto, in the case of a Guarantor) and is, in
each case, secured by Liens on assets of the Company or such Guarantor.

 

“Participant”
shall have the meaning provided in Section 13.7(c).

 

“Participating
Member State” means any member state of the European Communities that
adopts or has adopted the Euro as its lawful currency in accordance with
legislation of the European Community relating to Economic and Monetary Union.

 

“Patriot Act”
shall have the meaning provided in Section 13.21.

 

“Permitted
Asset Swap” means the concurrent purchase and sale or exchange of assets
used or useful in a Similar Business or a combination of such assets and cash,
Cash Equivalents or Temporary Cash Investments between the Company or any of
its Restricted Subsidiaries and another Person; provided that any cash
or Cash Equivalents received in excess of the value of any cash or Cash
Equivalents sold or exchanged must be applied in accordance with Section 10.5.

 

38

 

“Permitted
Collateral Liens” means (a) Liens on the Collateral (i) arising by
operation of law that are described in one or more of clauses (c), (d) and (i)
of the definition of “Permitted Liens” and that, in each case, would not
materially interfere with the ability of a Collateral Agent to enforce the Lien
on the Collateral or (ii) that are Liens over cash and bank accounts equally
and ratably granted to cash management banks securing cash management
obligations pursuant to Section 9.16, (b) Liens on the Collateral to secure
Indebtedness of the Company or a Restricted Subsidiary that is permitted to be
Incurred under clauses (i), (ii) (in the case of clause (ii), to the extent
such Guarantee is in respect of Indebtedness otherwise permitted to be secured
and specified in this definition of Permitted Collateral Liens), (iv)(A) (with
regard to the Bridge Facilities and any Senior Secured Notes only) and (iv)(C)
(if the original Indebtedness was so secured), (vi), (xi) or (xiii) secured
only by assets in the applicable jurisdiction) of Section 10.1(b) and any
Refinancing Indebtedness in respect of such Indebtedness; provided, however,
that such Lien ranks equal to all other Liens on such Collateral securing
Indebtedness of the Company or such Restricted Subsidiary, as applicable
(except that a Lien in favor of Indebtedness incurred under Section 10.1(b)(i)
and obligations under Hedging Agreements provided by Lenders or Affiliates of
Lenders (at the time such Hedging Agreements were entered into) may have super
priority not materially less favourable to the Lenders than that accorded to
the Credit Documents on the Closing Date and (c) Liens on the Collateral securing
Indebtedness incurred under Section 10.1 (a) and Section 10.1(b)(xii); provided
that, in the case of this clause (c), after giving effect to such Incurrence on
that date, the Consolidated Secured Leverage Ratio is less than 3.25:1.

 

“Permitted
Holders” means, collectively, (a) the Initial Investors and any one or more
Persons whose beneficial ownership constitutes or results in a Change of
Control in respect of which a Change of Control Offer is made in accordance
with the requirements of this Agreement, (b) Senior Management and (c) any
Person who is acting as an underwriter in connection with a public or private
offering of Capital Stock of any Parent or the Company, acting in such
capacity.

 

“Permitted
Investment” means (in each case, by the Company or any of its Restricted
Subsidiaries):

 

(a)                      Investments
in (i) a Restricted Subsidiary (including the Capital Stock of a Restricted
Subsidiary) or the Company or (ii) a Person (including the Capital Stock of any
such Person) that is engaged in any Similar Business and such Person will, upon
the making of such Investment, become a Restricted Subsidiary;

 

(b)                     Investments
in another Person if such Person is engaged in any Similar Business and as a
result of such Investment such other Person is merged, consolidated or
otherwise combined with or into, or transfers or conveys all or substantially
all its assets to, the Company or a Restricted Subsidiary;

 

(c)                      Investments
in cash, Cash Equivalents, Temporary Cash Investments or Investment Grade
Securities;

 

39

 

(d)                     Investments
in receivables owing to the Company or any Restricted Subsidiary created or
acquired in the ordinary course of business;

 

(e)                      Investments
in payroll, travel and similar advances to cover matters that are expected at
the time of such advances ultimately to be treated as expenses for accounting
purposes and that are made in the ordinary course of business;

 

(f)                        Management
Advances;

 

(g)                     Investments
in Capital Stock, obligations or securities received in settlement of debts
created in the ordinary course of business and owing to the Company or any
Restricted Subsidiary, or as a result of foreclosure, perfection or enforcement
of any Lien, or in satisfaction of judgments or pursuant to any plan of
reorganization or similar arrangement including upon the bankruptcy or
insolvency of a debtor;

 

(h)                     Investments
made as a result of the receipt of non-cash consideration from a sale or other
disposition of property or assets, including an Asset Disposition (but
excluding a Permitted Asset Swap), in each case, that was made in compliance
with Section 10.5;

 

(i)                         Investments
in existence on, or made pursuant to legally binding commitments in existence
on, the Closing Date and including the committed investment in PSSL (not
exceeding €5,000,000);

 

(j)                         Currency
Agreements, Interest Rate Agreements, Commodity Hedging Agreements and related
Hedging Obligations, which transactions or obligations are Incurred in
compliance with Section 10.1;

 

(k)                      After the
expiry of the Bridge Period, Investments, taken together with all other
Investments made pursuant to this clause (k) and at any time outstanding, in an
aggregate amount at the time of such Investment not to exceed €300,000,000; provided
that, if an Investment is made pursuant to this clause in a Person that is not
a Restricted Subsidiary and such Person subsequently becomes a Restricted
Subsidiary or is subsequently designated a Restricted Subsidiary pursuant to
Section 10.2, such Investment shall thereafter be deemed to have been made
pursuant to clause (a) or (b) of the definition of “Permitted Investments”
and not this clause;

 

(l)                         pledges
or deposits with respect to leases or utilities provided to third parties in
the ordinary course of business or Liens otherwise described in the definition
of “Permitted Liens” or made in connection with Liens permitted under
the covenant described under Section 10.3;

 

(m)                   any Investment
to the extent made using Capital Stock of the Company (other than Disqualified Stock)
or Capital Stock of any Parent as consideration;

 

40

 

(n)                     any
transaction to the extent constituting an Investment that is permitted and made
in accordance with the provisions of Section 10.6(b) (except those described in
Section 10.6(c)(i), 10.6(c)(iii), 10.6(c)(vi), 10.6(c)(viii), 10.6(c)(ix) and
10.6(c)(xii);

 

(o)                     Investments
consisting of purchases and acquisitions of inventory, supplies, materials and
equipment or licenses or leases of intellectual property, in any case, in the
ordinary course of business and in accordance with this Agreement;

 

(p)                     Guarantees
not prohibited by Section 10.1 and (other than with respect to Indebtedness)
guarantees, keepwells and similar arrangements in the ordinary course of
business;

 

(q)                     Investments
(i) in SSMC to increase the Company’s percentage ownership thereof; provided
that, after giving effect to such Investment, the Company is able to incur
€1.00 of Indebtedness under Section 10.1(a) or (ii) after the expiry of the
Bridge Period, in SSMC or any other Person partially financed by a Singapore
government agency (or another project finance with a local or multilateral
Governmental Authority) in an aggregate amount under this sub-clause (ii) not
to exceed €300,000,000;

 

(r)                        Loans to
Jilin on terms consistent with past practices between Jilin and the Seller, not
to exceed €25,000,000 at any one time outstanding; and

 

(s)                      Investments
in Crolles (or, in the event that Crolles is not continued, a similar research
and development program) to fund research and development activities and
maintenance capital expenditures in an aggregate amount not to exceed
€190,000,000 in the first two years after the Closing Date and €50,000,000 per
annum thereafter (with a carry over of unused amounts).

 

“Permitted
Liens” means, with respect to any Person:

 

(a)                      Liens on
assets or property of a Restricted Subsidiary that is not a Guarantor securing
Indebtedness of any Restricted Subsidiary that is not a Guarantor;

 

(b)                     pledges,
deposits or Liens under workmen’s compensation laws, unemployment insurance
laws, social security laws or similar legislation, or insurance related
obligations (including pledges or deposits securing liability to insurance
carriers under insurance or self-insurance arrangements), or in connection with
bids, tenders, completion guarantees, contracts (other than for borrowed money)
or leases, or to secure utilities, licenses, public or statutory obligations,
or to secure surety, indemnity, judgment, appeal or performance bonds,
guarantees of government contracts (or other similar bonds, instruments or
obligations), or as security for contested taxes or import or customs duties or
for the payment of rent, or other obligations of like nature, in each case
Incurred in the ordinary course of business;

 

(c)                      Liens
imposed by law, including carriers’, warehousemen’s, mechanics’, landlords’,
materialmen’s and repairmen’s or other like Liens, in each case for sums not

 

41

 

yet overdue for a period
of more than 60 days or that are bonded or being contested in good faith by appropriate
proceedings;

 

(d)                     Liens for
taxes, assessments or other governmental charges not yet delinquent or which
are being contested in good faith by appropriate proceedings; provided
that appropriate reserves required pursuant to GAAP have been made in respect
thereof;

 

(e)                      Liens in
favor of issuers of surety, performance or other bonds, guarantees or letters
of credit or bankers’ acceptances (not issued to support Indebtedness for
borrowed money) issued pursuant to the request of and for the account of the
Company or any Restricted Subsidiary in the ordinary course of its business;

 

(f)                        encumbrances,
ground leases, easements (including reciprocal easement agreements), survey
exceptions, or reservations of, or rights of others for, licenses, rights of
way, sewers, electric lines, telegraph and telephone lines and other similar
purposes, or zoning, building codes or other restrictions (including minor
defects or irregularities in title and similar encumbrances) as to the use of
real properties or Liens incidental to the conduct of the business of the
Company and its Restricted Subsidiaries or to the ownership of its properties
which do not in the aggregate materially adversely affect the value of said
properties or materially impair their use in the operation of the business of
the Company and its Restricted Subsidiaries;

 

(g)                     Liens on
assets or property of the Company or any Restricted Subsidiary securing Hedging
Obligations permitted under this Agreement;

 

(h)                     leases,
licenses, subleases and sublicenses of assets (including real property and
intellectual property rights), in each case entered into in the ordinary course
of business;

 

(i)                         Liens
arising out of judgments, decrees, orders or awards not giving rise to an Event
of Default so long as any appropriate legal proceedings which may have been
duly initiated for the review of such judgment, decree, order or award have not
been finally terminated or the period within which such proceedings may be
initiated has not expired;

 

(j)                         Liens on
assets or property of the Company or any Restricted Subsidiary for the purpose
of securing Capitalized Lease Obligations or Purchase Money Obligations, or
securing the payment of all or a part of the purchase price of, or securing
other Indebtedness Incurred to finance or refinance the acquisition,
improvement or construction of, assets or property acquired or constructed in
the ordinary course of business; provided that (i) the aggregate
principal amount of Indebtedness secured by such Liens is otherwise permitted
to be Incurred under this Agreement and (ii) any such Lien may not extend to
any assets or property of the Company or any Restricted Subsidiary other than
assets or property acquired, improved, constructed or leased with

 

42

 

the proceeds of such
Indebtedness and any improvements or accessions to such assets and property;

 

(k)                      Liens
arising by virtue of any statutory or common law provisions relating to
banker’s Liens, rights of set-off or similar rights and remedies as to deposit
accounts or other funds maintained with a depositary or financial institution;

 

(1)                      Liens
arising from Uniform Commercial Code financing statement filings (or similar
filings in other applicable jurisdictions) regarding operating leases entered
into by the Company and its Restricted Subsidiaries in the ordinary course of
business;

 

(m)                   Liens existing
on the Closing Date, excluding Liens securing the Senior Notes and the Bridge
Facilities;

 

(n)                     Liens on
property, other assets or shares of stock of a Person at the time such Person
becomes a Restricted Subsidiary (or at the time the Company or a Restricted
Subsidiary acquires such property, other assets or shares of stock, including
any acquisition by means of a merger, consolidation or other business
combination transaction with or into the Company or any Restricted Subsidiary);
provided, however, that such Liens are not created, Incurred or
assumed in anticipation of or in connection with such other Person becoming a
Restricted Subsidiary (or such acquisition of such property, other assets or stock);
provided, further, that such Liens are limited to all or part of
the same property, other assets or stock (plus improvements, accession,
proceeds or dividends or distributions in connection with the original
property, other assets or stock) that secured (or, under the written
arrangements under which such Liens arose, could secure) the obligations to
which such Liens relate;

 

(o)                     Liens on
assets or property of the Company or any Restricted Subsidiary securing
Indebtedness or other obligations of the Company or such Restricted Subsidiary
owing to the Company or another Restricted Subsidiary, or Liens in favor of the
Company or any Restricted Subsidiary;

 

(p)                     Liens (other
than Permitted Collateral Liens) securing Refinancing Indebtedness Incurred to
refinance Indebtedness that was previously so secured, and permitted to be
secured under this Agreement; provided that any such Lien is limited to
all or part of the same property or assets (plus improvements, accessions,
proceeds or dividends or distributions in respect thereof) that secured (or,
under the written arrangements under which the original Lien arose, could
secure) the Indebtedness being refinanced or is in respect of property that is
or could be the security for or subject to a Permitted Lien hereunder;

 

(q)                     any interest
or title of a lessor under any Capitalized Lease Obligation or operating lease;

 

(r)                        (i)                        mortgages,
liens, security interests, restrictions, encumbrances or any other matters of
record that have been placed by any government, statutory or regulatory

 

43

 

authority, developer,
landlord or other third party on property over which the Company or any
Restricted Subsidiary of the Company has easement rights or on any leased
property and subordination or similar arrangements relating thereto and (ii)
any condemnation or eminent domain proceedings affecting any real property;

 

(s)                      any
encumbrance or restriction (including put and call arrangements) with respect
to Capital Stock of any joint venture or similar arrangement pursuant to any joint
venture or similar agreement;

 

(t)                        Liens on
property or assets under construction (and related rights) in favor of a
contractor or developer or arising from progress or partial payments by a third
party relating to such property or assets;

 

(u)                     Liens on cash
accounts securing Indebtedness incurred under Section 10.1(b)(xi) with local
financial institutions;

 

(v)                     Liens on
Escrowed Proceeds for the benefit of the related holders of debt securities or
other Indebtedness (or the underwriters or arrangers thereof) or on cash set
aside at the time of the Incurrence of any Indebtedness or government
securities purchased with such cash, in either case to the extent such cash or
government securities prefund the payment of interest on such Indebtedness and
are held in an escrow account or similar arrangement to be applied for such
purpose;

 

(w)                   Liens securing
or arising by reason of any netting or set-off arrangement entered into in the
ordinary course of banking or other trading activities or Liens over cash accounts
securing cash pooling arrangements;

 

(x)                       Liens
arising out of conditional sale, title retention, hire purchase, consignment or
similar arrangements for the sale of goods entered into in the ordinary course
of business;

 

(y)                     Liens
Incurred in the ordinary course of business with respect to obligations (other
than Indebtedness for borrowed money) which do not exceed €50,000,000 at any
one time outstanding;

 

(z)                       Permitted
Collateral Liens;

 

(aa)                Liens on Capital
Stock or other securities or assets of any Unrestricted Subsidiary that secure
Indebtedness of such Unrestricted Subsidiary; and

 

(bb)              any security granted
over the marketable securities portfolio described in clause (i) of the
definition of “Cash Equivalents” in connection with the disposal thereof
to a third party.

 

“Person”
means any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization, limited liability
company, government or any agency or political subdivision thereof or any other
entity.

 

44

 

“Platform”
shall have the meaning provided in Section 13.20(b).

 

“PMP” means
a professional market party (professionele
marktpartif)  within the meaning of the
Exemption Regulation to the Dutch Banking Act.

 

“Preferred
Stock.” as applied to the Capital Stock of any Person, means Capital Stock
of any class or classes (however designated) which is preferred as to the
payment of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation or dissolution of such Person, over shares of Capital
Stock of any other class of such Person.

 

“Prime Rate”
shall mean the rate of interest per
annum publicly announced from
time to time by Deutsche Bank AG New York Branch as its reference rate in
effect at its principal office in New York City (the Prime Rate not being
intended to be the lowest rate of interest charged by Deutsche Bank AG New York
Branch in connection with extensions of credit to debtors).

 

“PSSL”
means Philips Semiconductors (Suzhou) Co. Ltd.

 

“Public Market”
means any time after:

 

(a)                      an Equity
Offering has been consummated; and

 

(b)                     shares of
common stock or other common equity interests of the IPO Entity having a market
value in excess of €100,000,000 on the date of such Equity Offering have been
distributed pursuant to such Equity Offering.

 

“Public
Offering” means any offering, including an Initial Public Offering, of
shares of common stock or other common equity interests that are listed on an
exchange or publicly offered (which shall include an offering pursuant to Rule
144A and/or Regulation S under the Securities Act to professional market
investors or similar persons).

 

“Purchase Money
Obligations” means any Indebtedness Incurred to finance or refinance the
acquisition, leasing, construction or improvement of property (real or
personal) or assets (including Capital Stock), and whether acquired through the
direct acquisition of such property or assets or the acquisition of the Capital
Stock of any Person owning such property or assets, or otherwise.

 

“Reference
Banks” means, in relation to LIBOR. and Mandatory Cost the principal London
offices of Morgan Stanley Bank International Limited, Deutsche Bank AG London
Branch and Merrill Lynch Capital Corporation and, in relation to EURIBOR, the
principal office in London of Morgan Stanley Bank International Limited,
Deutsche Bank AG London Branch or Merrill Lynch Capital Corporation or such
other banks as may be appointed by the Administrative Agent in consultation
with the Company.

 

“Refinance”
means refinance, refund, replace, renew, repay, modify, restate, defer,
substitute, supplement, reissue, resell, extend or increase (including pursuant
to any

 

45

 

defeasance or discharge
mechanism) and the terms “refinances.” “refinanced” and “refinancing”
as used for any purpose in this Agreement shall have a correlative meaning.

 

“Refinancing
Indebtedness” means Indebtedness that is Incurred to refund, refinance,
replace, exchange, renew, repay or extend (including pursuant to any defeasance
or discharge mechanism) any Indebtedness existing on the date of this Agreement
or Incurred in compliance with this Agreement (including Indebtedness of the
Company that refinances Indebtedness of any Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary that refinances Indebtedness of the
Company or another Restricted Subsidiary) including Indebtedness that
refinances Refinancing Indebtedness; provided, however, that:

 

(a)                      if the
Indebtedness being refinanced constitutes Subordinated Indebtedness, the
Refinancing Indebtedness has a final Stated Maturity at the time such
Refinancing Indebtedness is Incurred that is the same as or later than the
final Stated Maturity of the Indebtedness being refinanced or, if shorter, this
Agreement;

 

(b)                     such
Refinancing Indebtedness is Incurred in an aggregate principal amount (or if
issued with original issue discount, an aggregate issue price) that is equal to
or less than the sum of the aggregate principal amount (or if issued with
original issue discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced (plus, without duplication, any additional
Indebtedness Incurred to pay interest or premiums required by the instruments
governing such existing Indebtedness and costs, expenses and fees Incurred in
connection therewith);

 

(c)                      if the
Indebtedness being refinanced is expressly subordinated to this Agreement, such
Refinancing Indebtedness is subordinated to this Agreement on terms at least as
favorable to the Lenders as those contained in the documentation governing the
Indebtedness being refinanced;

 

provided,
however, that Refinancing Indebtedness shall not include Indebtedness of
the Company or a Restricted Subsidiary that refinances Indebtedness of an
Unrestricted Subsidiary.

 

Refinancing
Indebtedness in respect of any Credit Facility or any other Indebtedness may be
Incurred from time to time after the termination, discharge or repayment of any
such Credit Facility or other Indebtedness.

 

“Register”
shall have the meaning provided in Section 13.7(b)(iv).

 

“Regulation D”
shall mean Regulation D of the Board as from time to time in effect and any
successor to all or a portion thereof establishing reserve requirements.

 

“Regulation T”
shall mean Regulation T of the Board as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.

 

“Regulation U”
shall mean Regulation U of the Board as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.

 

46

 

“Regulation X”
shall mean Regulation X of the Board as from time to time in effect and any
successor to all or a portion thereof establishing margin requirements.

 

“Reimbursement
Date” has the meaning given in Section 3.4.

 

“Related
Parties” shall mean, with respect to any specified Person, such Person’s
Affiliates and the directors, officers, employees, agents, trustees, advisors
of such Person and any Person that possesses, directly or indirectly, the power
to direct or cause the direction of the management or policies of such Person,
whether through the ability to exercise voting power, by contract or otherwise.

 

“Related Person”
with respect to any Permitted Holder means:

 

(a)                      any
controlling equityholder or Subsidiary of such Person; or

 

(b)                     in the case
of an individual, any spouse, family member or relative of such individual, any
trust or partnership for the benefit of one or more of such individual and any
such spouse, family member or relative, or the estate, executor, administrator,
committee or beneficiaries of any thereof; or

 

(c)                      any trust,
corporation, partnership or other Person for which one or more of the Permitted
Holders and other Related Persons of any thereof constitute the beneficiaries,
stockholders, partners or owners thereof, or Persons beneficially holding in
the aggregate a majority (or more) controlling interest therein; or

 

(d)                     in the case
of the Initial Investors any investment fund or vehicle managed, sponsored or
advised by such Person or any successor thereto, or by any Affiliate of such
Person or any such successor.

 

“Related Taxes”
means

 

(a)                      any Taxes,
including sales, use, transfer, rental, ad valorem, value added, stamp,
property, consumption, franchise, license, capital, registration, business,
customs, net worth, gross receipts, excise, occupancy, intangibles or similar
Taxes (other than (x) Taxes measured by income and (y) withholding imposed on
payments made by any Parent), required to be paid (provided such Taxes are in
fact paid) by any Parent by virtue of its:

 

(i)                         being organized
or having Capital Stock outstanding (but not by virtue of owning stock or other
equity interests of any corporation or other entity other than, directly or
indirectly, the Company or any of the Company’s Subsidiaries);

 

(ii)                      issuing or
holding Subordinated Shareholder Funding;

 

(iii)                   being a holding
company parent, directly or indirectly, of the Company or any of the Company’s
Subsidiaries;

 

47

 

(iv)                  receiving
dividends from or other distributions in respect of the Capital Stock of,
directly or indirectly, the Company or any of the Company’s Subsidiaries; or

 

(v)                     having made
any payment in respect to any of the items for which the Company is permitted
to make payments to any Parent pursuant to Section 10.2; or

 

(b)                     if and for so
long as the Company is a member of a group filing a consolidated or combined
tax return with any Parent, any Taxes measured by income for which such Parent
is liable up to an amount not to exceed with respect to such Taxes the amount
of any such Taxes that the Company and its Subsidiaries would have been
required to pay on a separate company basis or on a consolidated basis if the
Company and its Subsidiaries had paid tax on a consolidated, combined, group,
affiliated or unitary basis on behalf of an affiliated group consisting only of
the Company and its Subsidiaries.

 

“Relevant
Interbank Market” means in relation to the Base Currency, the European
interbank market and, in relation to any other currency, the London interbank
market.

 

“Relevant
Taxing Jurisdiction” shall mean any jurisdiction in which the Borrowers are
organized or otherwise considered to be a resident for tax purposes at the time
such Lender becomes a party to this Agreement, or any political subdivision or
Governmental Authority thereof or therein having the power to tax.

 

“Reorganization”
means the restructure by the Seller to facilitate the Acquisition as
contemplated by the Acquisition Agreement and the Acquisition Side Letter.

 

“Required
Lenders” shall mean, at any date, (a) until the Total Commitments are
reduced to zero, Non-Defaulting Lenders having or holding more than 50% of the
sum of (i) aggregate principal amount of Loans outstanding, (ii) Letter of
Credit Exposures and (iii) the Adjusted Total Commitment, in each case, as at
such date, or (b) if the Total Commitments have been terminated, the holders
(excluding Defaulting Lenders) of a majority of the outstanding principal
amount of the Loans and Letter of Credit Exposures (excluding the Loans and
Letter of Credit Exposure of Defaulting Lenders) in the aggregate at such date
(with the aggregate Base Currency Equivalent of each Lender’s risk
participation and funded participation in L/C Borrowings being deemed “held” by
such Lender for the purposes of the definition).

 

“Requirement of
Law” shall mean, as to any Person, the Certificate of Incorporation and
by-laws or other organizational or governing documents of such Person, and any
law, treaty, rule or regulation or determination of an arbitrator or a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or assets or to which such Person or any of its
property or assets is subject.

 

“Responsible
Officer” means:

 

48

 

(a)                      when used
with respect to the Administrative Agent, any officer within the Loan
Operations Group (or any successor group of the Administrative Agent) or any
other officer of the Administrative Agent customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer
to whom such matter is referred because of his knowledge of and familiarity
with the particular subject; or

 

(b)                     when used
with respect to any Credit Party or any of its Subsidiaries, the chief executive
officer, chief financial officer, where customary in the relevant jurisdiction,
any Managing Director (or any two Managing Directors, if elected by such Credit
Party), treasurer, controller or any other senior officer (or two such
officers, if the relevant Credit Party so elects) authorized to represent such
Credit Party and designated as such by the Company in writing to the
Administrative Agent.

 

“Restricted
Investment” means any Investment other than a Permitted Investment.

 

“Restricted
Payment” has the meaning given in Section 10.2(a)(iv).

 

“Restricted
Subsidiary” means any Subsidiary of the Company other than an Unrestricted
Subsidiary and for the avoidance of doubt does not include the Crolles assets
as in existence on the date hereof unless and until designated otherwise by the
Company in a notice to the Administrative Agent.

 

“Revaluation
Date” means (a) each date on which a Credit Event occurs, (b) each date of
a continuation or conversion of a Loan pursuant to Section 2.6, (c) the last
day of the Interest Period with respect to a Loan or, if earlier, the date
which is three months after the date of the Borrowing of a Loan, (d) each date
of an amendment, extension or renewal of any Letter of Credit having the effect
of increasing the amount thereof, and (e) each date of any payment or
disbursement by a Letter of Credit Issuer under any Letter of Credit.

 

“S&P”
means Standard & Poor’s Investors Ratings Services or any of its successors
or assigns that is a Nationally Recognized Statistical Rating Organization.

 

“SEC” shall
mean the Securities and Exchange Commission or any successor thereto.

 

“Secured Bridge
Facility” means the €1,500,000,000 and US$1,921,290,000 Senior Secured
Increasing Rate Bridge Facility dated as of the date of this Agreement between
the Company and the Co-Borrower (as co-borrowers), Morgan Stanley Senior
Funding, Inc. as administrative agent and the banks and financial institutions
from time to time party thereto as lenders.

 

“Secured
Indebtedness” means any Indebtedness secured by a Lien.

 

“Secured Note
Indenture” means the Indenture relating to the issuance of the Senior
Secured Notes expected to be entered into between the Company and the
Co-Borrower

 

49

 

(as co-issuers), Deutsche
Bank Trust Company Americas, as trustee and certain subsidiaries of the Company
named as parties thereto as guarantors.

 

“Secured
Obligations” shall have the meaning assigned to such term in the Security
Documents.

 

“Secured
Parties” shall have the meaning assigned to such term in the applicable
Security Documents.

 

“Securities Act”
means the U.S. Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder, as amended.

 

“Security
Documents” shall mean, collectively, (a) the Collateral Agency Agreement,
(b) each of the documents, agreements and instruments set forth or Schedule
1.1(e), and (c) each other security agreement or other instrument or document
executed and delivered pursuant to Section 9.11, 9.12 or 9.13 or pursuant to
any of the Security Documents to secure any of the Secured Obligations.

 

“Seller”
has the meaning given in the preamble.

 

“Senior
Management” means the officers, directors, and other members of senior
management of the Company or any of its Subsidiaries, who at any date
beneficially own or have the right to acquire, directly or indirectly, Capital
Stock of the Company or any Parent and with an equity investment in excess of
€250,000.

 

“Senior Notes”
means Senior Secured Notes or Senior Unsecured Notes.

 

“Senior Notes
Offering” has the meaning given in the preamble to this Agreement.

 

“Senior Secured
Notes” means senior secured notes issued by the Company pursuant to the
Secured Note Indenture.

 

“Senior
Unsecured Notes” means senior unsecured notes issued by the Company
pursuant to the Unsecured Note Indenture.

 

“Significant
Subsidiary” means any Restricted Subsidiary that meets any of the following
conditions:

 

(a)                      the
Company’s and its Restricted Subsidiaries’ investments in and advances to the
Restricted Subsidiary exceed 10% of the total assets of the Company and its
Restricted Subsidiaries on a consolidated basis as of the end of the most
recently completed fiscal year;

 

(b)                     the Company’s
and its Restricted Subsidiaries’ proportionate share of the total assets (after
intercompany eliminations) of the Restricted Subsidiary exceeds 10%

 

50

 

of the total assets of
the Company and its Restricted Subsidiaries on a consolidated basis as of the
end of the most recently completed fiscal year; or

 

(c)                      the
Company’s and its Restricted Subsidiaries’ equity in the income from continuing
operations before income taxes, extraordinary items and cumulative effect of a
change in accounting principle of the Restricted Subsidiary exceeds 10% of such
income of the Company and its Restricted Subsidiaries on a consolidated basis
for the most recently completed fiscal year.

 

“Similar
Business” means (a) any businesses, services or activities engaged in by
the Company or any of its Subsidiaries or any Associates on the Closing Date
and (b) any businesses, services and activities engaged in by the Company or
any of its Subsidiaries or any Associates that are related, complementary,
incidental, ancillary or similar to any of the foregoing or are extensions or
developments of any thereof.

 

“Singapore
Dollars” or “S$” means the lawful currency of the Republic of
Singapore.

 

“Singapore
Dollars Sublimit” means €250,000,000 (or its equivalent in Singapore
Dollars).

 

“Sponsor”
means KKR European Fund II, Limited Partnership, KKR Millennium Fund
(Overseas), Limited Partnership, Silver Lake Partners II, Cayman L.P.,
AlpInvest CS Investments 2006 C.V., Bain Capital Fund IX, L.P., Bain Capital
Fund VII-E, L.P., Apax Europe Fund V-A, L.P., Apax Europe Fund VI-A, L.P., or
any other Person approved in writing by the Joint Lead Arrangers prior to the
date hereof.

 

“SSMC”
means Systems On Silicon Manufacturing Company Pte Ltd.

 

“Stated Amount”
of any Letter of Credit shall mean the maximum amount from time to time
available to be drawn thereunder, determined without regard to whether any
conditions to drawing could then be met.

 

“Stated
Maturity” means, with respect to any security, the date specified in such
security as the fixed date on which the payment of principal of such security
is due and payable, including pursuant to any mandatory redemption provision,
but shall not include any contingent obligations to repay, redeem or repurchase
any such principal prior to the date originally scheduled for the payment
thereof.

 

“Status”
shall mean, as to any Borrower as of any date, the existence of Level I Status,
Level II Status, Level III Status, Level IV Status and/or Level A Status or
Level B Status, as the case may be on such date. Changes in Status resulting
from changes in the Net Leverage Ratio shall become effective (the date of such
effectiveness, the “Effective Date”) as of the first day following the
last day of the most recent fiscal year or period for which (a) Section 9.1
Financials are delivered to the Lenders under Section 9.1 and (b) an officer’s
certificate is delivered by the Borrower to the Lenders setting forth, with
respect to such Section 9.1

 

51

 

Financials, the
then-applicable Status, and shall remain in effect until the next change to be
effected pursuant to this definition, provided that (i) if any Borrower
shall have made any payments in respect of interest or commitment fees during
the period (the “Interim Period”) from and including the Effective Date
to but excluding the day any change in Status is determined as provided above,
then the amount of the next such payment due on or after such day shall be
increased or decreased by an amount equal to any underpayment or overpayment so
made by any Borrower during such Interim Period and (ii) each determination of
the Net Leverage Ratio pursuant to this definition shall be made with respect
to the period ending at the end of the fiscal period covered by the relevant
financial statements.

 

“Statutory
Reserve Rate” shall mean for any day as applied to any LIBOR Loan, a
fraction (expressed as a decimal), the numerator of which is the number one and
the denominator of which is the number one minus the aggregate of the maximum
reserve percentages that are in effect on that day (including any marginal,
special, emergency or supplemental reserves), expressed as a decimal, as
prescribed by the Board and to which the Administrative Agent is subject, for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities”
in Regulation D of the Board). Such reserve percentages shall include those
imposed pursuant to such Regulation D. LIBOR Loans shall be deemed to
constitute eurocurrency funding and to be subject to such reserve requirements
without benefit of or credit for proration, exemptions or offsets that may be
available from time to time to any Lender under such Regulation D or any
comparable regulation. The Statutory Reserve Rate shall be adjusted automatically
on and as of the effective date of any change in any reserve percentage.

 

“Sterling”
and “£” means the lawful currency of the United Kingdom.

 

“Subordinated
Indebtedness” means, with respect to any person, any Indebtedness (whether
outstanding on the Closing Date or thereafter Incurred) which is expressly
subordinated in right of payment to the obligations of the Borrowers under this
Agreement pursuant to a written agreement.

 

“Subordinated
Shareholder Funding” means, collectively, any funds provided to the Company
by a Parent in exchange for or pursuant to any security, instrument or
agreement other than Capital Stock, in each case issued to and held by
Holdings, together with any such security, instrument or agreement and any
other security or instrument other than Capital Stock issued in payment of any
obligation under any Subordinated Shareholder Funding; provided, however,
that such Subordinated Shareholder Funding:

 

(a)                      does not
mature or require any amortization, redemption or other repayment of principal
or any sinking fund payment prior to September 29, 2013 (other than through
conversion or exchange of such funding into Capital Stock (other than
Disqualified Stock) of the Company or any funding meeting the requirements of
this definition);

 

(b)                     does not
require, prior to September 29, 2013, payment of cash interest, cash
withholding amounts or other cash gross-ups, or any similar cash amounts;

 

52

 

(c)                      contains no
change of control or similar provisions and does not accelerate and has no right
to declare a default or event of default or take any enforcement action or
otherwise require any cash payment, in each case, prior to September 29, 2013;

 

(d)                     does not
provide for or require any security interest or encumbrance over any asset of
the Company or any of its Subsidiaries; and

 

(e)                      pursuant to
its terms is fully subordinated and junior in right of payment to this
Agreement, the Bridge Loans and Senior Notes pursuant to subordination, payment
blockage and enforcement limitation terms which are customary in all material
respects for similar funding.

 

“Subsidiary”
means, with respect to any Person:

 

(a)                      any
corporation, association, or other business entity (other than a partnership,
joint venture, limited liability company or similar entity) of which more than
50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time of determination owned
or controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person or a combination thereof; or

 

(b)                     any
partnership, joint venture, limited liability company or similar entity of
which:

 

(i)                         more than
50% of the capital accounts, distribution rights, total equity and voting
interests or general or limited partnership interests, as applicable, are owned
or controlled, directly or indirectly, by such Person or one or more of the
other Subsidiaries of that Person or a combination thereof whether in the form
of membership, general, special or limited partnership interests or otherwise;
and

 

(ii)                      such Person
or any Subsidiary of such Person is a controlling general partner or otherwise
controls such entity.

 

“Successor
Parent” with respect to any Person means any other Person with more than
50% of the total voting power of the Voting Stock of which is, at the time the
first Person becomes a Subsidiary of such other Person, “beneficially owned”
(as defined below) by one or more Persons that “beneficially owned” (as
defined below) more than 50% of the total voting power of the Voting Stock of
the first Person immediately prior to the first Person becoming a Subsidiary of
such other Person. For purposes hereof, “beneficially own” has the
meaning correlative to the term “beneficial owner.” as such term is
defined in Rules 13d-3 and 13d-5 under the Exchange Act (as in effect on the
Closing Date).

 

“Swiss Francs”
and “Fr” means the lawful currency of the Federal Republic of
Switzerland.

 

53

 

“Taiwan
Collateral Agent” means Mizuho Corporate Bank, Ltd. or any successor acting
in that role.

 

“Tax Credit”
means any credit against any Taxes or any relief or remission for Taxes (or
their repayment).

 

“Tax
Distribution” shall mean any distribution permitted to be paid pursuant to
Section 10.2(c)(ix)(A).

 

“Taxes”
means all present and future taxes, levies, imposts, deductions, charges,
duties and withholdings and any charges of a similar nature (including
interest, penalties and other liabilities with respect thereto) that are
imposed by any government or other taxing authority.

 

“Tax Sharing
Agreement” means any tax sharing or profit and loss pooling or similar
agreement with customary or arm’s-length terms entered into with any Parent or
Unrestricted Subsidiary, as the same may be amended, supplemented, waived or
otherwise modified from time to time in accordance with the terms thereof and
of this Agreement.

 

“Temporary Cash
Investments” means any of the following:

 

(a)                      any
investment in:

 

(i)                         direct
obligations of, or obligations Guaranteed by, (A) the United States of America
or Canada, (B) any European Union member state, (C) Switzerland or Norway, (D)
any country in whose currency funds are being held specifically pending
application in the making of an investment or capital expenditure by the
Company or a Restricted Subsidiary in that country with such funds or (E) any
agency or instrumentality of any such country or member state, or

 

(ii)                      direct
obligations of any country recognized by the United States of America rated at
least “A” by S&P or “A-l” by Moody’s (or, in either case, the equivalent of
such rating by such organization or, if no rating of S&P or Moody’s then
exists, the equivalent of such rating by any Nationally Recognized Statistical
Rating Organization);

 

(b)                     overnight
bank deposits, and investments in time deposit accounts, certificates of
deposit, bankers’ acceptances and money market deposits (or, with respect to
foreign banks, similar instruments) maturing not more than one year after the
date of acquisition thereof issued by:

 

(i)                         any
Lender;

 

(ii)                      any
institution authorized to operate as a bank in any of the countries or member
states referred to in subclause (a)(i) above; or

 

54

 

(iii)                   any bank or
trust company organized under the laws of any such country or member state or
any political subdivision thereof;

 

in each case, having
capital and surplus aggregating in excess of €250,000,000 (or the foreign
currency equivalent thereof) and whose long-term debt is rated at least “A” by
S&P or “A-2” by Moody’s (or, in either case, the equivalent of such rating
by such organization or, if no rating of S&P or Moody’s then exists, the
equivalent of such rating by any Nationally Recognized Statistical Rating Organization)
at the time such Investment is made;

 

(c)                      repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (a) or (b) above entered into with a Person
meeting the qualifications described in clause (b) above;

 

(d)                     Investments
in commercial paper, maturing not more than 270 days after the date of
acquisition, issued by a Person (other than the Company or any of its
Subsidiaries), with a rating at the time as of which any Investment therein is
made of “P- 2” (or higher) according to Moody’s or “A-2” (or higher) according
to S&P (or, in either case, the equivalent of such rating by such
organization or, if no rating of S&P or Moody’s then exists, the equivalent
of such rating by any Nationally Recognized Statistical Rating Organization);

 

(e)                      Investments
in securities maturing not more than one year after the date of acquisition
issued or fully Guaranteed by any state, commonwealth or territory of the
United States of America, Canada, any European Union member state or
Switzerland, Norway or by any political subdivision or taxing authority of any
such state, commonwealth, territory, country or member state, and rated at
least “BBB” by S&P or “Baa3” by Moody’s (or, in either case, the equivalent
of such rating by such organization or, if no rating of S&P or Moody’s then
exists, the equivalent of such rating by any Nationally Recognized Statistical
Rating Organization);

 

(f)                        bills of
exchange issued in the United States, Canada, a member state of the European
Union, Switzerland, Norway or Japan eligible for rediscount at the relevant
central bank and accepted by a bank (or any dematerialized equivalent);

 

(g)                     any money
market deposit accounts issued or offered by a commercial bank organized under
the laws of a country that is a member of the Organization for Economic
Co-operation and Development, in each case, having capital and surplus in
excess of €250,000,000 (or the foreign currency equivalent thereof) or whose
long term debt is rated at least “A” by S&P or “A2” by Moody’s (or, in
either case, the equivalent of such rating by such organization or, if no rating
of S&P or Moody’s then exists, the equivalent of such rating by any
Nationally Recognized Statistical Rating Organization) at the time such
Investment is made;

 

55

 

(h)                     investment
funds investing 95% of their assets in securities of the type described in
clauses (a) through (g) above (which funds may also hold reasonable amounts of
cash pending investment and/or distribution); and

 

(i)                         investments
in money market funds complying with the risk limiting conditions of Rule 2a-7
(or any successor rule) of the SEC under the U.S. Investment Company Act of
1940, as amended.

 

“Termination
Date” shall mean the date on which the Commitments shall have terminated,
no Loans shall be outstanding and the Letters of Credit Outstanding shall have
been reduced to zero.

 

“Total Assets”
means the consolidated total assets of the Company and its Restricted
Subsidiaries in accordance with GAAP as shown on the most recent balance sheet
of such Person; provided that pending the acquisitions of ASMC and
Jilin, such balance sheet shall give pro forma effect to such acquisitions.

 

“Total
Commitments” shall mean the sum of the Commitments of all the Lenders.

 

“Transactions”
means the acquisition by Holdings of the Company and its Subsidiaries and the
related transactions (including the repayment of existing indebtedness of the
Company and the disentanglement) pursuant to the Acquisition Agreement
(including the Equity Investments) and the Acquisition Side Letter, the drawing
of the Bridge Loans and the refinancing thereof with Senior Notes, and the
extensions of credit under this Agreement.

 

“Transaction
Expenses” shall mean any fees or expenses incurred or paid by the Company
or any of its Subsidiaries in connection with the Transactions, this Agreement
and the other Credit Documents and the transactions contemplated hereby and
thereby.

 

“Transferee”
shall have the meaning provided in Section 13.7(e).

 

“Type”
shall mean, in relation to any Loan, its nature as an ABR Loan, a LIBOR Loan or
a EURIBOR Loan.

 

“Uniform
Commercial Code” means the New York Uniform Commercial Code.

 

“Unpaid Drawing”
shall have the meaning provided in Section 3.4.

 

“Unrestricted
Subsidiary” means SSMC and (upon acquisition of Jilin by the Company or a
Restricted Subsidiary) Jilin and:

 

(a)                      any
Subsidiary of the Company (other than the Co-Borrower) that at the time of
determination is an Unrestricted Subsidiary (as designated by the Board of
Directors of the Company in the manner provided below); and

 

(b)                     any
Subsidiary of an Unrestricted Subsidiary.

 

56

 

The Board of
Directors of the Company may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary or a Person becoming a Subsidiary
through merger, consolidation or other business combination transaction, or
Investment therein) to be an Unrestricted Subsidiary only if:

 

(i)                         such
Subsidiary or any of its Subsidiaries does not own any Capital Stock or
Indebtedness of, or own or hold any Lien on any property of, the Company or any
other Subsidiary of the Company which is not a Subsidiary of the Subsidiary to
be so designated or otherwise an Unrestricted Subsidiary; and

 

(ii)                      such
designation and the Investment of the Company in such Subsidiary complies with
Section 10.2.

 

Any such
designation by the Board of Directors of the Company shall be evidenced to the
Administrative Agent by filing with the Administrative Agent a resolution of
the Board of Directors of the Company giving effect to such designation and an
Officer’s Certificate certifying that such designation complies with the
foregoing conditions.

 

The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided, that immediately after giving effect to
such designation (a) no Default or Event of Default would result therefrom, and
(b)(i) the Fixed Charge Coverage Ratio would not be greater than 2.00 to 1.00
or (ii) the Fixed Charge Coverage Ratio would not be worse than it was immediately
prior to giving effect to such designation, in each case, on a pro  forma
basis taking into account such designation. Any such designation by the Board
of Directors shall be evidenced to the Administrative Agent by promptly filing
with the Administrative Agent a copy of the resolution of the Board of
Directors giving effect to such designation or an Officer’s Certificate
certifying that such designation complied with the foregoing provisions.

 

“Unsecured
Bridge Facility” means the €1,500,000,000 Senior Unsecured Increasing Rate
Bridge Facility dated as of the date of this Agreement between the Company and
the Co-Borrower (as borrowers), Morgan Stanley Senior Funding, Inc. as
administrative agent and the banks and financial institutions from time to time
party thereto as lenders.

 

“Unsecured Note
Indenture” means the Indenture relating to the issuance of the Senior
Unsecured Notes expected to be entered into between the company and the
Co-Borrower (as co-issuers), Deutsche Bank Trust Company Americas as trustee
and certain subsidiaries of the Company named as parties thereto as guarantors.

 

“US Dollars”,
“Dollars” and “US$” means the lawful currency of the United
States of America.

 

“US Government
Obligations” means securities that are (a) direct obligations of the United
States of America for the timely payment of which its full faith and credit is
pledged or (b) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the United States of America the timely payment
of which is unconditionally

 

57

 

Guaranteed as a full
faith and credit obligation of the United States of America, which, in either
case, are not callable or redeemable at the option of the Company thereof, and
shall also include a depositary receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such US
Government Obligations or a specific payment of principal of or interest on any
such US Government Obligations held by such custodian for the account of the
holder of such depositary receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depositary receipt from any amount received by the
custodian in respect of the US Government Obligations or the specific payment
of principal of or interest on the US Government Obligations evidenced by such
depositary receipt.

 

“Voting Stock”
of a Person means all classes of Capital Stock of such Person then outstanding
and normally entitled to vote in the election of directors.

 

“Wholly-Owned
Subsidiary” means a Restricted Subsidiary of the Company, all of the
Capital Stock of which (other than directors’ qualifying shares or shares
required by any applicable law or regulation to be held by a Person other than
the Company or another Wholly-Owned Subsidiary) is owned by the Company or
another Wholly-Owned Subsidiary.

 

“Yen” and “¥”
means the lawful currency of Japan.

 

1.2.                  Other
Interpretive Provisions. With reference to this Agreement and each other
Credit Document, unless otherwise specified herein or in such other Credit
Document:

 

(a)                      The meanings
of defined terms are equally applicable to the singular and plural forms of the
defined terms.

 

(b)                     The words
“herein”, “hereto”, “hereof” and “hereunder” and words of similar import when
used in any Credit Document shall refer to such Credit Document as a whole and
not to any particular provision thereof.

 

(c)                      Article,
Section, Exhibit and Schedule references are to the Credit Document in which
such reference appears.

 

(d)                     The term
“including” is by way of example and not limitation.

 

(e)                      The term
“documents” includes any and all instruments, documents, agreements,
certificates, notices, reports, financial statements and other writings,
however evidenced, whether in physical or electronic form.

 

(f)                        In the
computation of periods of time from a specified date to a later specified date,
the word “from” means “from and including”; the words “to” and “until” each
mean “to but excluding”; and the word “through” means “to and including”.

 

(g)                     Section
headings herein and in the other Credit Documents are included for convenience
of reference only and shall not affect the interpretation of this Agreement or
any other Credit Document.

 

58

 

(h)                     Any reference
herein to any Person shall be construed to include such Person’s successors and
assigns.

 

(i)                         Any
reference to a time of day is a reference to London time.

 

(j)                         Any
reference to a “Managing Director” of a Dutch Borrower or a Credit Party
organized or established under the laws of the Netherlands means a managing
director (bestuurder).

 

1.3.                  Accounting
Terms. All accounting terms not specifically or completely defined herein
shall be construed in conformity with, and all financial data (including
financial ratios and other financial calculations) required to be submitted
pursuant to this Agreement shall be prepared in conformity with, GAAP.

 

1.4.                  Rounding.
Any financial ratios required to be maintained by the Company pursuant to this
Agreement (or required to be satisfied in order for a specific action to be
permitted under this Agreement) shall be calculated by dividing the appropriate
component by the other component, carrying the result to one place more than
the number of places by which such ratio is expressed herein and rounding the
result up or down to the nearest number (with a rounding-up if there is no
nearest number).

 

1.5.                  References to
Agreements, Laws, Etc. Unless otherwise expressly provided herein, (a)
references to organizational and constitutive documents, agreements (including
this Agreement and each of the other Credit Documents) and other contractual
instruments shall be deemed to include all subsequent amendments, restatements,
amendment and restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, amendment
and restatements, extensions, supplements and other modifications are permitted
by any Credit Document; and (b) references to any Law shall include all
statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Law.

 

1.6.                  Exchange
Rates. For purposes of determining compliance under Sections 10.2 (other
than with respect to determining the amount of any Indebtedness) and 10.5, with
respect to any amount in a Foreign Currency, such amount shall be deemed to
equal the Base Currency Equivalent thereof based on the average Exchange Rate
for a Foreign Currency for the most recent twelve-month period immediately
prior to the date of determination determined in a manner consistent with that
used in calculating Consolidated EBITDA for the related period. For purposes of
determining compliance with Sections 10.1, 10.2 and 10.3, with respect to any
amount of Indebtedness in a Foreign Currency, compliance will be determined at
the time of Incurrence or advancing thereof using the Base Currency Equivalent
thereof at the Exchange Rate in effect at the time of such Incurrence or
advancement.

 

1.7.                  Liability of
Co-Borrower. The Co-Borrower shall be jointly and severally liable for all
of the obligations and liabilities of the Company under this Agreement and the
other Credit Documents; provided that the obligations of the Co-Borrower
under this Agreement and the other Credit Documents shall be limited to an
aggregate amount that would

 

59

 

not
render such obligations subject to avoidance under Section 548 of the United
States Bankruptcy Code or any comparable provisions of applicable law.

 

SECTION 2.         Amount
and Terms of Credit

 

2.1.         Commitments. (a) Subject to and upon the terms and
conditions herein set forth, each Lender severally agrees to make a Loan or
Loans denominated in the Base Currency or any Alternative Currency to the
Borrowers which Loans (i) shall be made at any time and from time to time on
and after the Closing Date and prior to the Maturity Date provided that
the aggregate Base Currency Equivalent of Loans made on the Closing Date or
during the period of 10 Business Days thereafter shall not exceed €100,000,000,
(ii) may, at the option of the relevant Borrower be incurred and maintained as,
and/or converted into, ABR Loans (in the case of Loans denominated in US
Dollars), LIBOR Loans or EURIBOR Loans, provided that all Loans made by
each of the Lenders pursuant to the same Borrowing shall, unless otherwise
specifically provided herein, consist entirely of Loans of the same Type, (iii)
may be repaid and reborrowed in accordance with the provisions hereof, (iv)
shall not, for any such Lender at any time, after giving effect thereto and to
the application of the proceeds thereof, result in such Lender’s Credit
Exposure at such time exceeding such Lender’s Commitment at such time, (v)
shall not, after giving effect thereto and to the application of the proceeds
thereof, result at any time in the aggregate amount of the Lenders’ Credit
Exposures at such time exceeding the Total Commitment then in effect and (vi)
shall not, after giving effect thereto and to the application of the proceeds
thereof, result at any time in the aggregate amount of the Lenders’ Credit
Exposures at such time denominated in Singapore Dollars or HK Dollars exceeding
the Singapore Dollars Sublimit or the HK Dollars Sublimit (as applicable).

 

(b)          Each
Lender may at its option make any EURIBOR Loan or LIBOR Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan,
provided that (i) any exercise of such option shall not affect the obligation
of the relevant Borrower to repay such Loan and (ii) in exercising such option,
such Lender shall use its reasonable efforts to minimize any increased costs to
the relevant Borrower resulting therefrom (which obligation of the Lender shall
not require it to take, or refrain from taking, actions that it determines
would result in increased costs for which it will not be compensated hereunder
or that it determines would be otherwise disadvantageous to it and in the event
of such request for costs for which compensation is provided under this
Agreement, the provisions of Section 2.10 shall apply). All Loans shall be
repaid in full together with all accrued but unpaid interest thereon pursuant
to Section 2.8(e) on the Maturity Date or as otherwise required by Section 2.5.
In the event that any Loan is made by any domestic or foreign branch or
Affiliate of a Lender on behalf of such Lender as contemplated by this clause
(b) all of the provisions of this Agreement applicable to Lenders shall apply
to and be enforceable by any such domestic or foreign branch or Affiliate.

 

2.2.         Minimum
Amount of Each Borrowing; Maximum Number of Borrowings. The aggregate principal amount of each Borrowing
shall be in a multiple of, in the case of LIBOR Loans and EURIBOR Loans,
€1,000,000 (or its equivalent in any Alternative Currency) or, in the case of
ABR Loans, $500,000 and, in each case, shall not be less than the Minimum
Borrowing Amount with respect thereto. More than one Borrowing may be incurred

 

60

 

on
any date, provided that at no time shall there be outstanding more than
25 Borrowings of Loans under this Agreement.

 

2.3.         Notice
of Borrowing  (a) Whenever a
Borrower desires to incur Loans (other than borrowings to repay Unpaid
Drawings), it shall give the Administrative Agent at the Administrative Agent’s
Office, (i) prior to 10:00 a.m. at least two Business Days’ prior written
notice (or telephonic notice promptly confirmed in writing) of each Borrowing
of LIBOR Loans or EURIBOR Loans, and (ii) prior to 12:00 Noon at least one
Business Day’s prior written notice (or telephonic notice promptly confirmed in
writing) of each Borrowing of ABR Loans. Each such notice (a “Notice of
Borrowing”), except as otherwise expressly provided in Section 2.10, shall
specify (i) the aggregate principal amount of the Loans to be made pursuant to
such Borrowing, (ii) the date of Borrowing (which shall be a Business Day),
(iii) the currency of such Borrowing (which shall be US Dollars in the case of
ABR Loans, the Base Currency in the case of EURIBOR Loans or an Alternative
Currency in the case of LIBOR Loans) and (iv) whether the respective Borrowing
shall consist of ABR Loans, LIBOR Loans or EURIBOR Loans and, if LIBOR Loans or
EURIBOR Loans, the Interest Period to be initially applicable thereto. If a
Borrower specifies a Type of Loan but fails to specify the currency of such
Loan in a Notice of Borrowing, then the Loan so requested shall be made in the
Base Currency in the case of EURIBOR Loans or US Dollars in the case of LIBOR
Loans and ABR Loans. If a Borrower specifies the currency of a Loan but fails
to specify a Type of Loan in a Notice of Borrowing, then the Loan so required
shall be a EURIBOR Loan (in the case of Loans denominated in the Base Currency)
or a LIBOR Loan (in the case of Loans denominated in an Alternative Currency).
If a Borrower fails to specify both the currency of a Loan and the Type of Loan
in a Notice of Borrowing, then the Loan so requested shall be a made in the
Base Currency and shall be a EURIBOR Loan. If a Borrower fails to specify an
Interest Period (if applicable) of a Loan in a Notice of Borrowing then the
Loan so requested shall have an initial Interest Period of one month. Upon receipt
of a Notice of Borrowing, the Administrative Agent shall confirm there are
sufficient Available Commitments and that neither the HK Dollars Sublimit nor
the Singapore Dollars Sublimit (nor, in the case of a Borrowing by Holdings,
the Holdings Sublimit) will be exceeded after giving effect to the proposed
Borrowing and the Administrative Agent shall promptly give each Lender written
notice (or telephonic notice promptly confirmed in writing) of each proposed
Borrowing, of such Lender’s proportionate share thereof and of the other
matters covered by the related Notice of Borrowing.

 

(b)          Borrowings
to reimburse Unpaid Drawings shall be made upon the notice specified in Section
3.4.

 

(c)          Without
in any way limiting the obligation of a Borrower to confirm in writing any
notice it may give hereunder by telephone, the Administrative Agent may act
prior to receipt of written confirmation without liability upon the basis of
such telephonic notice believed by the Administrative Agent in good faith to be
from an Authorized Officer of a Borrower. In each such case, such Borrower
hereby waives the right to dispute the Administrative Agent’s record of the
terms of any such telephonic notice. Any Notice of Borrowing delivered in
writing to the Administrative Agent shall be in substantially the form set
forth in Exhibit B.

 

61

 

2.4.         Disbursement
of Funds. (a) No later than
12:00 Noon on the date specified in each Notice of Borrowing, each Lender will
make available its pro rata portion,
if any, of each Borrowing requested to be made on such date in the manner
provided below.

 

(b)          Each
Lender shall make available all amounts it is to fund to a Borrower under any
Borrowing in immediately available funds in the relevant currency to the
Administrative Agent at the Administrative Agent’s Office and the
Administrative Agent will (except in the case of Borrowings to repay Unpaid
Drawings) make available to such Borrower, by depositing to an account
designated by such Borrower to the Administrative Agent the aggregate of the amounts
so made available in the relevant currency. Unless the Administrative Agent
shall have been notified by any Lender prior to the date of any such Borrowing
that such Lender does not intend to make available to the Administrative Agent
its portion of the Borrowing or Borrowings to be made on such date, the
Administrative Agent may assume that such Lender has made such amount available
to the Administrative Agent on such date of Borrowing, and the Administrative
Agent, in reliance upon such assumption, may (in its sole discretion and
without any obligation to do so) make available to the relevant Borrower a
corresponding amount. If such corresponding amount is not in fact made
available to the Administrative Agent by such Lender and the Administrative Agent
has made available same to the relevant Borrower, the Administrative Agent
shall be entitled to recover such corresponding amount from such Lender. If
such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent’s demand therefor the Administrative Agent shall promptly
notify the relevant Borrower, and such Borrower shall immediately pay such
corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover from such Lender or such Borrower interest on
such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Administrative Agent to the
relevant Borrower to the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal
to (i) if paid by such Lender, the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking
industry practice on interbank compensation, plus any administrative,
processing or similar fees customarily charged by the Administrative Agent in
connection with the foregoing, or (ii) if paid by the Borrower, the
then-applicable rate of interest, calculated in accordance with Section 2.8,
for the relevant Loans.

 

(c)          Nothing
in this Section 2.4 shall be deemed to relieve any Lender from its obligation
to fulfill its commitments hereunder or to prejudice any rights that any
Borrower may have against any Lender as a result of any default by such Lender
hereunder (it being understood, however, that the obligations of each Lender
hereunder are several and no Lender shall be responsible for the failure of any
other Lender to fulfill its obligations hereunder).

 

2.5.         Repayment
of Loans; Evidence of Debt.
(a) Each Borrower shall repay to the Administrative Agent, for the benefit of
the Lenders, on the Maturity Date, the then-unpaid Loans made to such Borrower,
provided that each Borrower shall repay to the Administrative Agent, for
the benefit of the Lenders, the full amount of any and all Loans made to such
Borrower on the Closing Date or during the 10 Business Day period after the
Closing Date, no later than the date which is 10 Business Days after the
Closing Date.

 

62

 

(b)          Each
Lender shall maintain in accordance with its usual practice an account or
accounts evidencing the indebtedness of each Borrower to the appropriate
lending office of such Lender resulting from each Loan made by such lending
office of such Lender from time to time, including the amounts of principal and
interest payable and paid to such lending office of such Lender from time to
time under this Agreement.

 

(c)          The
Administrative Agent shall maintain the Register pursuant to Section 13.7(b),
in which Register shall be recorded (i) the amount of each Loan made hereunder,
the Borrower of such Loan, the Type of each Loan made and the Interest Period
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the relevant Borrower to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder from the relevant Borrower and each Lender’s share thereof.

 

(d)          The
entries made in the Register and accounts maintained pursuant to paragraphs (b)
and (c) of this Section 2.5 shall, to the extent permitted by applicable Law,
be prima facie evidence of the existence and amounts of the obligations of a
Borrower therein recorded; provided,  however, that the failure of
any Lender or the Administrative Agent to maintain such account, such Register
or such subaccount, as applicable, or any error therein, shall not in any
manner affect the obligation of any Borrower to repay (with applicable
interest) the Loans made to such Borrower by such Lender in accordance with the
terms of this Agreement.

 

2.6.         Conversions
and Continuations. (a) A
Borrower shall have the option on any Business Day to convert all or a portion
equal to at least the Minimum Borrowing Amount of the outstanding principal
amount of Loans made to such Borrower of one Type into a Borrowing or
Borrowings of another Type and such Borrower shall have the option on any
Business Day to continue the outstanding principal amount of any LIBOR Loans or
EURIBOR Loans, as the case may be, for an additional Interest Period, provided
that (i) no partial conversion of LIBOR Loans or EURIBOR Loans shall reduce the
outstanding principal amount of LIBOR Loans or EURIBOR Loans made pursuant to a
single Borrowing to less than the Minimum Borrowing Amount, (ii) ABR Loans may
not be converted into LIBOR Loans if a Default or Event of Default is in
existence on the date of the conversion and the Administrative Agent has or the
Required Lenders have determined in its or their sole discretion not to permit
such conversion, (iii) LIBOR Loans denominated in US Dollars may not be
continued as LIBOR Loans for an additional Interest Period if an Event of
Default is in existence on the date of the proposed continuation and the
Administrative Agent has or the Required Lenders have determined in its or their
sole discretion not to permit such continuation, and (iv) Borrowings resulting
from conversions pursuant to this Section 2.6 shall be limited in number as
provided in Section 2.2. Each such conversion or continuation shall be effected
by the relevant Borrower by giving the Administrative Agent at the
Administrative Agent’s Office prior to 10:00 a.m. at least two Business Days’
(or one Business Day’s notice in the case of a conversion into ABR Loans) prior
written notice (or telephonic notice promptly confirmed in writing) (each, a “Notice
of Conversion or Continuation”) specifying the Loans to be so converted or
continued, the Type of Loans to be converted or continued into and, if such
Loans or are to be converted into or continued as LIBOR Loans or EURIBOR Loans,
the Interest Period to be initially applicable

 

63

 

thereto.
The Administrative Agent shall give each Lender notice as promptly as
practicable of any such proposed conversion or continuation affecting any of
its Loans.

 

(b)          If any
Default or Event of Default is in existence at the time of any proposed
continuation of any LIBOR Loans denominated in US Dollars and the
Administrative Agent has or the Required Lenders have determined in its or
their sole discretion not to permit such continuation, such LIBOR Loans shall
be automatically converted on the last day of the current Interest Period into
ABR Loans. If upon the expiration of any Interest Period in respect of LIBOR
Loans or EURIBOR Loans, a Borrower has failed to specify a new Interest Period
to be applicable thereto as provided in paragraph (a) above, such Borrower
shall be deemed to have specified an Interest Period of one month, effective as
of the expiration date of such current Interest Period. If a Borrower requests
the conversion to, or continuation of, a LIBOR Loan or a EURIBOR Loan, but
fails to specify an Interest Period, it will be deemed to have specified an
Interest Period of one month. No Loan may be converted into or continued as a
Loan denominated in a different currency, but instead such Loan must be prepaid
in the original currency of such Loan and a new Loan reborrowed in the other
currency.

 

2.7.         Pro Rata Borrowings. Each Borrowing of Loans under this Agreement shall be granted by the
Lenders pro rata on the basis of
their then-applicable Commitments, respectively. It is understood that (a) no
Lender shall be responsible for any default by any other Lender in its
obligation to make Loans hereunder and that each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure
of any other Lender to fulfill its commitments hereunder and (b) other than as
expressly provided herein with respect to a Defaulting Lender, failure by a
Lender to perform any of its obligations under any of the Credit Documents
shall not release any Person from performance of its obligation under any
Credit Document.

 

2.8.         Interest. (a) The unpaid principal amount of each ABR
Loan shall bear interest from the date of the Borrowing thereof until maturity
(whether by acceleration or otherwise) at a rate per annum that shall at all times be the Applicable ABR
Margin plus the ABR in effect from time to time.

 

(b)          The
unpaid principal amount of each LIBOR Loan shall bear interest from the date of
the Borrowing thereof until maturity thereof (whether by acceleration or
otherwise) at a rate per annum
that shall at all times be aggregate of (i) the Applicable LIBOR Margin in
effect from time to time, (ii) the relevant LIBOR Rate, and (iii) the Mandatory
Cost, if any.

 

(c)          The
unpaid principal amount of each EURIBOR Loan shall bear interest for the date
of the Borrowing thereof until maturity thereof (whether by acceleration or
otherwise) at a rate per annum
that shall at all times be the aggregate of (i) the Applicable EURIBOR Margin
in effect from time to time, (ii) the relevant EURIBOR Rate, and (iii) the
Mandatory Cost, if any.

 

(d)          If all
or a portion of (i) the principal amount of any Loan (ii) the principal amount
of any Unpaid Drawing or (iii) any interest payable thereon shall not be paid
when due (whether at the stated maturity, by acceleration or otherwise), such
overdue amount shall bear

 

64

 

interest
at a rate per annum that is (x)
in the case of overdue principal on any Loan or Unpaid Drawing, the rate that
would otherwise be applicable thereto plus 1% or (y) in the case of any
overdue interest, to the extent permitted by applicable law, the rate described
in Section 2.8(a), (b) or (c), as applicable, plus 1%, in each case from
and including the date of such non-payment to but excluding the date on which
such amount is paid in full (after as well as before judgment).

 

(e)          Interest
on each Loan shall accrue from and including the date of any Borrowing to but
excluding the date of any repayment thereof and shall be payable (i) in respect
of each ABR Loan, quarterly in arrears on the last day of each March, June,
September and December, (ii) in respect of each LIBOR Loan and EURIBOR Loan, on
the last day of each Interest Period applicable thereto and, in the case of an
Interest Period in excess of three months, on each date occurring at
three-month intervals after the first day of such Interest Period, and (iii) in
respect of each Loan (except, other than in the case of prepayments, any ABR
Loan), on any prepayment (on the amount prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.

 

(f)           All
computations of interest hereunder shall be made in accordance with Section
5.5.

 

(g)          Each
Lender shall supply the Administrative Agent with any information required by
the Administrative Agent in order to calculate the Mandatory Cost in accordance
with Schedule 1.1(d).

 

(h)          The
Administrative Agent, upon determining the interest rate for any Borrowing of
Loans, shall promptly notify the relevant Borrower and the relevant Lenders
thereof. Each such determination shall, absent clearly demonstrable error, be
final and conclusive and binding on all parties hereto.

 

2.9.         Interest
Periods. At the time a
Borrower gives a Notice of Borrowing or Notice of Conversion or Continuation in
respect of the making of, or conversion into or continuation as, a Borrowing of
LIBOR Loans or EURIBOR Loans (in the case of the initial Interest Period
applicable thereto) or prior to 10:00 a.m. at least two Business Days prior to
the expiration of an Interest Period applicable to a Borrowing of LIBOR Loans
or EURIBOR Loans, such Borrower shall have the right to elect by giving the
Administrative Agent written notice (or telephonic notice promptly confirmed in
writing) the Interest Period applicable to a Borrowing, which Interest Period
shall, at the option of the relevant Borrower be a one, two, three, or six
month period, provided that the initial Interest Period may be for a
period less than one month if agreed upon by the relevant Borrower and the
Administrative Agent.

 

Notwithstanding anything to the contrary contained above:

 

(a)          the
initial Interest Period for any Borrowing of LIBOR Loans or EURIBOR Loans shall
commence on the date of such Borrowing (including the date of any conversion
from a Borrowing of ABR Loans) and each Interest Period occurring thereafter in
respect of such Borrowing shall commence on the day on which the next preceding
Interest Period expires;

 

65

 

(b)          if any
Interest Period relating to a Borrowing of LIBOR Loan or EURIBOR Loan begins on
the last Business Day of a calendar month or begins on a day for which there is
no numerically corresponding day in the calendar month at the end of such
Interest Period, such Interest Period shall end on the last Business Day of the
calendar month at the end of such Interest Period;

 

(c)          if any
Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day, provided
that if any Interest Period in respect of a LIBOR Loan or EURIBOR Loan would
otherwise expire on a day that is not a Business Day but is a day of the month
after which no further Business Day occurs in such month, such Interest Period
shall expire on the next preceding Business Day;

 

(d)          the
Borrower shall not be entitled to elect any Interest Period in respect of any
LIBOR Loan or EURIBOR Loan if such Interest Period would extend beyond the
Maturity Date; and

 

(e)          after
giving effect to all Borrowings, all conversions of Loans from one Type to the
other, and all continuations of Loans as the same Type, there shall not be more
than 25 Interest Periods in effect with respect to LIBOR Loans and EURIBOR
Loans.

 

2.10.       Increased
Costs, Illegality, etc. (a) In the event that (x) in the case of clause (i)
below, the Administrative Agent or (y) in the case of clauses (ii) and (iii)
below, any Lender shall have reasonably determined (which determination shall,
absent clearly demonstrable error, be final and conclusive and binding upon all
parties hereto):

 

(i)           on
any date for determining the LIBOR Rate or EURIBOR Rate for any Interest Period
that (x) deposits in the principal amounts of the Loans comprising such
Borrowing are not generally available in the relevant currency in the Relevant
Interbank Market for a period equivalent to the relevant Interest Period or (y)
by reason of any changes arising on or after the Closing Date affecting the
Relevant Interbank Market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in the
definition of LIBOR Rate or EURIBOR Rate (as the case may be); or

 

(ii)          at
any time, that such Lender shall incur any increase in the cost to such Lender
or reductions in the amounts received or receivable hereunder in connection
with making or agreeing to make, funding or maintaining, LIBOR Loans, EURIBOR
Loans or its Commitment hereunder (other than any such increase or reduction
attributable to Taxes) because of (x) any Change in Law, such as, for example,
without limitation, a change in official reserve requirements, and/or (y) other
circumstances affecting the Relevant Interbank Market or the position of such
Lender in such market; or

 

(iii)         at any time, that the making or continuance of
any LIBOR Loan or EURIBOR Loan or its Commitment hereunder has become unlawful
by compliance by such Lender in good faith with any Law, governmental rule,
regulation, guideline or

 

66

 

order (or would conflict
with any such governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be
unlawful), or has become impracticable as a result of a contingency occurring
after the date hereof that materially and adversely affects the Relevant
Interbank Market;

 

then, and in any
such event, such Lender (or the Administrative Agent, in the case of clause (i)
above) shall within a reasonable time thereafter give notice (if by telephone,
confirmed in writing) to the relevant Borrower and to the Administrative Agent
of such determination (which notice the Administrative Agent shall promptly
transmit to each of the other Lenders). Thereafter (x) in the case of clause
(i) above, LIBOR Loans and EURIBOR Loans shall no longer be available until
such time as the Administrative Agent notifies the relevant Borrower and the
Lenders that the circumstances giving rise to such notice by the Administrative
Agent no longer exist (which notice the Administrative Agent agrees to give at
such time when such circumstances no longer exist), and any Notice of Borrowing
or Notice of Conversion or Continuation given by any Borrower with respect to
LIBOR Loans or EURIBOR Loans that have not yet been incurred shall be deemed
rescinded by the relevant Borrower (y) in the case of clause (ii) above, the
relevant Borrower shall pay to such Lender, promptly after receipt of written
demand therefor such additional amounts (in the form of an increased rate of,
or a different method of calculating, interest or otherwise as such Lender in
its reasonable discretion shall determine) as shall be required to compensate
such Lender for such increased costs or reductions in amounts receivable
hereunder (it being agreed that a written notice as to the additional amounts
owed to such Lender, showing in reasonable detail the basis for the calculation
thereof, submitted to the relevant Borrower by such Lender shall, absent
clearly demonstrable error, be final and conclusive and binding upon all
parties hereto) and (z) in the case of clause (iii) above, the Borrower shall
take one of the actions specified in Section 2.10(b) as promptly as possible
and, in any event, within the time period required by Law.

 

(b)          At any
time that any LIBOR Loan or EURIBOR Loan is affected by the circumstances
described in Section 2.10(a)(ii) or (iii), the relevant Borrower may (and in
the case of a LIBOR Loan or EURIBOR Loan affected pursuant to Section
2.10(a)(iii) shall) either (i) if the affected LIBOR Loan or EURIBOR Loan has
been requested pursuant to a Notice of Borrowing or a Notice of Conversion or
Continuation but has not been made, cancel said Borrowing by giving the
Administrative Agent telephonic notice (confirmed promptly in writing) thereof
on the same date that such Borrower was notified by a Lender pursuant to 2.10(a)(ii)
or (iii); or (ii) if the affected LIBOR Loan or EURIBOR Loan is then
outstanding (x) upon at least three Business Days’ notice to the Administrative
Agent (if such Lender may lawfully continue to maintain such LIBOR Loans or
EURIBOR Loans to such day or immediately, if such Lender may not lawfully
continue to maintain such LIBOR Loans or EURIBOR Loans), require the affected
Lender to convert each such LIBOR Loan and EURIBOR Loan into an ABR Loan if
such conversion would overcome the illegality and each Loan so converted shall,
unless already denominated in Dollars, be redenominated into Dollars at the
applicable Exchange Rate, (y) prepay the affected EURIBOR Loans or LIBOR Loans
on the last day of the Interest Period applicable thereto, if such Lender may
lawfully continue to maintain such LIBOR Loan or EURIBOR Loan to such date, or
immediately, if such Lender may not lawfully continue to maintain such LIBOR
Loan or EURIBOR Loan, or (z) cause any affected Lender to assign the affected
EURIBOR Loans or LIBOR Loans to another Lender or to

 

67

 

another bank or
institution willing to accept such assignment (which assignment shall be
subject to and in compliance with Section 13.7) to the extent any such affected
Lender may lawfully continue to maintain the relevant LIBOR Loans or EURIBOR
Loans until such time as such assignment becomes effective in accordance with
the terms hereof. Upon any such conversion or prepayment, the relevant Borrower
shall also pay accrued interest on the amount so converted or prepaid all
amounts due, if any, in connection with such prepayment or conversion under
Section 2.11. The relevant Borrower shall pay all reasonable costs and expenses
incurred by any Lender in connection with any assignment pursuant to sub-clause
(z). If more than one Lender is affected at any time, then all affected Lenders
must be treated in the same manner pursuant to this Section 2.10(b).

 

(c)          If, after
the date hereof, the adoption of any applicable Law, rule or regulation
regarding capital adequacy, or any Change in Law, or any change in the
interpretation or administration thereof by any Governmental Authority, the
National Association of Insurance Commissioners, any central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by a Lender or its parent with any request or directive made or adopted after
the date hereof regarding capital adequacy (whether or not having the force of
law) of any such authority, association, central bank or comparable agency, has
or would have the effect of reducing the rate of return on such Lender’s or its
parent’s or its Affiliate’s capital or assets as a consequence of such Lender’s
commitments or obligations hereunder to a level below that which such Lender or
its parent or its Affiliate could have achieved but for such adoption,
effectiveness, change or compliance (taking into consideration such Lender’s or
its parent’s policies with respect to capital adequacy), then from time to
time, promptly after demand by such Lender (with a copy to the Administrative
Agent), the relevant Borrower shall pay to such Lender such additional amount
or amounts as will compensate such Lender or its parent or its Affiliates for
such reduction, it being understood and agreed, however, that a Lender shall
not be entitled to compensation for such reduction except to the extent
resulting from the adoption of any applicable Law, rule or regulation regarding
capital adequacy, or any Change in Law, or any change in the interpretation or
administration thereof by any Governmental Authority, the National Association
of Insurance Commissioners, any central bank or comparable agency charged with
the interpretation or administration thereof, after the date hereof. Each
Lender, upon determining in good faith that any additional amounts will be
payable pursuant to this Section 2.10(c), will give prompt written notice
thereof to the relevant Borrower which notice shall set forth in reasonable
detail the basis of the calculation of such additional amounts, although the
failure to give any such notice shall not, subject to Section 2.13, release or
diminish such Borrower’s obligations to pay additional amounts pursuant to this
Section 2.10(c) upon receipt of such notice.

 

(d)          It is
understood that this Section 2.10 shall not apply to Excluded Taxes or to any
amounts that would be payable under Section 5.4 but for another provision of
Section 5.4 or, to the extent duplicative of Section 5.4, this Section 2.10
shall not apply to Taxes.

 

2.11.       Compensation.
If (a) any payment of principal of any LIBOR Loan or EURIBOR Loan is made by a
Borrower to or for the account of a Lender, or is converted or continued, other
than on the last day of the Interest Period for such LIBOR Loan or EURIBOR Loan
as a result of a payment or conversion pursuant to Section 2.5, 2.6, 2.10, 5.1,
5.2 or 13.8, as

 

68

 

a result of acceleration
of the maturity of the Loans pursuant to Section 11 or for any other reason,
(b) any Borrowing of LIBOR Loans or EURIBOR Loans is not made as a result of a withdrawn
Notice of Borrowing or as a result of the operation of any of the provisions of
this Agreement, (c) any ABR Loan is not converted into a LIBOR Loan as a result
of a withdrawn Notice of Conversion or Continuation or as a result of the
operation of any of the provisions of this Agreement, (d) any LIBOR Loan or
EURIBOR Loan is not continued as a LIBOR Loan or EURIBOR Loan (as the case may
be), as a result of a withdrawn Notice of Conversion or Continuation or as a
result of the operation of any of the provisions of this Agreement, (e) any
prepayment of principal of any LIBOR Loan or EURIBOR Loan is not made as a
result of a withdrawn notice of prepayment pursuant to Section 5.1 or 5.2 or as
a result of the operation of any of the provisions of this Agreement, (f) any
assignment of a LIBOR Loan or EURIBOR Loan on a day other than the last day of
the Interest Period for such Loan as a result of a request by the Company
pursuant to Section 13.8(a), the relevant Borrower shall, after receipt of a
written request by such Lender (which request shall set forth in reasonable
detail the basis for requesting such amount), pay to the Administrative Agent
for the account of such Lender any amounts required to compensate such Lender
for any additional losses, costs or expenses that such Lender may reasonably
incur as a result of such payment, failure to convert, failure to continue or
failure to prepay, including any loss, cost or expense (excluding loss of
anticipated profits) actually incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or
maintain such LIBOR Loan or EURIBOR Loan.

 

For purposes of
calculating amounts payable by a Borrower to the Lenders under this Section
2.11, each Lender shall be deemed to have funded each LIBOR Loan or EURIBOR
Loan (as the case may be) made by it by a matching deposit or other borrowing
in the Relevant Interbank Market in the relevant currency for a comparable
amount and for a comparable period, whether or not such LIBOR Loan or EURIBOR
Loan (as the case may be) was in fact so funded.

 

2.12.       Change
of Lending Office. Each Lender agrees that, upon the occurrence of any
event giving rise to the operation of Section 2.10(a)(ii), 2.10(a)(iii),
2.10(b), 3.5 or 5.4 with respect to such Lender, it will, if requested by the
relevant Borrower use commercially reasonable efforts (subject to overall
policy considerations of such Lender) to designate another lending office for
any Loans affected by such event or to assign its rights and obligations
hereunder to another of its branches or Affiliates, provided that such
designation or assignment is made on such terms that would eliminate or reduce
amounts payable pursuant to Section 2.10(a)(ii), 2.10(a)(iii), 2.10(b), 3.5 or
5.4, as the case may be, and that, in such Lender’s judgment, cause such Lender
and its lending office suffer no economic (including becoming subject to any
unreimbursed cost or expense), legal or regulatory disadvantage. Nothing in
this Section 2.12 shall affect or postpone any of the obligations of any
Borrower or the right of any Lender provided in Section 2.10, 3.5 or 5.4.

 

2.13.       Notice
of Certain Costs. Notwithstanding anything in this Agreement to the
contrary, to the extent any notice required by Section 2.10, 2.11, 3.5 or 5.4
is given by any Lender more than 180 days after such Lender has knowledge (or
should have had knowledge) of the occurrence of the event giving rise to the
additional cost, reduction in amounts, loss, tax or other additional amounts
described in such Sections, such Lender shall not be entitled to

 

69

 

compensation under
Section 2.10, 2.11, 3.5 or 5.4, as the case may be, for any such amounts
incurred or accruing prior to the 181st day prior to the giving of such notice
to the Borrower.

 

2.14.       Additional
Alternative Currencies. (a) A Borrower may from time to time request that
LIBOR Loans be made and/or a Letter of Credit be issued in an Additional
Alternative Currency. A currency will only constitute an Additional Alternative
Currency for the purposes of a Credit Event if (i) it is a lawful currency that
is readily available in the amount required and freely transferable and
convertible into the Base Currency in the Relevant Interbank Market on the date
the Administrative Agent receives the relevant Notice of Borrowing or Letter of
Credit Request (as applicable) and the date on which the Credit Event occurs,
and (ii) it has been approved by the Administrative Agent (acting on the
instructions of, in the case of the making of a LIBOR Loan, all the Lenders and
in the case of the issuance of a Letter of Credit, all the Lenders and the
Letter of Credit Issuer) on or prior to receipt by the Administrative Agent of
the relevant Notice of Borrowing or Letter of Credit Request (as applicable)
for that Credit Event.

 

(b)          Any such
request for approval of an Additional Alternative Currency pursuant to clause
(a) above shall be made to the Administrative Agent not later than 11:00 a.m.,
five Business Days prior to the date of the proposed Credit Event (or such
other time or date as may be agreed by the Administrative Agent). In the case
of any such request pertaining to a LIBOR Loan, the Administrative Agent shall
promptly notify each Lender thereof and, in the case of any such request
pertaining to the issuance of Letters of Credit, the Administrative Agent shall
promptly notify each Letter of Credit Issuer thereof. Each Lender (in the case
of any such request pertaining to LIBOR Loans) or the Letter of Credit Issuer
(in the case of a request pertaining to the issuance of Letters of Credit)
shall notify the Administrative Agent, not later than 11:00 a.m., two Business
Days after receipt of such request whether it consents, in its sole discretion,
to the making of LIBOR Loans or the issuance of Letters of Credit, as the case
may be, in such requested currency and the minimum amount (and, if required,
integral multiples) for any subsequent Credit Event in that currency.

 

(c)          The
failure by a Lender or any Letter of Credit Issuer, as the case may be, to
respond to such notice within the time period specified in clause (b) above
shall be deemed to be a refusal by such Lender or the Letter of Credit Issuer,
as the case may be, to permit LIBOR Loans to be made or Letters of Credit to be
issued in the requested currency.

 

(d)          If the
Administrative Agent and all the Lenders and the Letters of Credit Issuers (as
the case may be) consent to making LIBOR Loans or the issuance of Letters of
Credit (as the case may be) in the currency requested by a Borrower, the
Administrative Agent shall promptly notify the relevant Borrower mat the
requested currency is acceptable and such currency shall thereupon be deemed
for all purposes to be an Additional Alternative Currency hereunder for
purposes of LIBOR Loans and Letters of Credit.

 

(e)          The
Administrative Agent shall promptly notify the relevant Borrower and the
Company (if different) if any Lender and (if applicable) the Letter of Credit
Issuer does not approve the relevant currency requested.

 

70

 

SECTION 3.  Letters of Credit

 

3.1.         Letters
of Credit. (a) Subject to and upon the terms and conditions herein set
forth, at any time and from time to time on and from the Closing Date and prior
to the L/C Maturity Date, the Letter of Credit Issuer agrees to issue upon the
request of, and for the benefit of the Borrowers and the Restricted
Subsidiaries standby letters of credit, letters of credit or bank guarantees in
the Base Currency or any Alternative Currency (the “Letters of Credit”
and each, a “Letter of Credit”) in such form as may be approved by such
Letter of Credit Issuer in its reasonable discretion; provided that the
Company shall be a co-applicant, and jointly and severally liable with respect
to, each Letter of Credit issued for the account of a Restricted Subsidiary.

 

(b)          Notwithstanding
the foregoing, (i) no Letter of Credit shall be issued the Stated Amount of
which, when added to the Letters of Credit Outstanding at such time, would
exceed the L/C Sublimity then in effect; (ii) no Letter of Credit shall be
issued the Stated Amount of which would cause the aggregate amount of the
Lenders’ Credit Exposures at such time to exceed the Total Commitments then in
effect; (iii) each Letter of Credit shall have an expiration date occurring no
later than one year after the date of issuance thereof, unless otherwise agreed
upon by the Administrative Agent and the Letter of Credit Issuer but may by its
terms be automatically renewed for additional 12 month periods, provided
that in no event shall such expiration date occur later than the L/C Maturity
Date; (iv) each Letter of Credit shall be denominated in the Base Currency or
any Alternative Currency; (v) no Letter of Credit shall be issued if it would
be illegal under any applicable Law or is prohibited by any order, judgment,
decree of any Governmental Authority or arbitrator which, by its terms,
purports to enjoin or restrain the Letter of Credit Issuer from issuing such
Letter of Credit or any request or directive (whether or not having the force
of Law) from any Governmental Authority with jurisdiction over the Letter of
Credit Issuer shall prohibit, or request that the Letter of Credit Issuer
refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular; (vi) no Letter of Credit shall be issued by Morgan
Stanley Bank International Limited or any of its Affiliates if the Stated
Amount of such Letter of Credit, when added to the Letters of Credit
Outstanding of Morgan Stanley Bank International Limited and its Affiliates at
such time, would result in Morgan Stanley Bank International Limited and its
Affiliates having issued Letters of Credit with an aggregate Stated Amount in
excess of, in aggregate, £150,000,000 (or its equivalent in any Alternative
Currency); (vii) no Letter of Credit shall be issued which is denominated in
Singapore Dollars if the Stated Amount of such Letter of Credit, when added to
the aggregate amount of the Lenders’ Credit Exposures at such time denominated
in Singapore Dollars, would exceed the Singapore Dollars Sublimit; (viii) no
Letter of Credit shall be issued which is denominated in HK Dollars if the
Stated Amount of such Letter of Credit when added to the aggregate amount of
the Lenders’ Credit Exposures at such time denominated in HK Dollars, would
exceed the HK Dollars Sublimit; and (ix) without limiting Section 7.1, no
Letter of Credit shall be issued by a Letter of Credit Issuer after it has
received a written notice from any Credit Party or any Lender stating that a
Default or Event of Default has occurred and is continuing until such time as
the Letter of Credit Issuer shall have received a written notice of (x)
rescission of such notice from the party or parties originally delivering such
notice or (y) the waiver of such Default or Event of Default in accordance with
the provisions of Section 13.2.

 

71

 

(c)          Upon at
least three Business Day’s prior written notice (or telephonic notice promptly
confirmed in writing) to the Administrative Agent and the Letter of Credit
Issuer (which notice the Administrative Agent shall promptly transmit to each
of the applicable Lenders), a Borrower shall have the right, on any day,
permanently to terminate or reduce the L/C Sublimit in whole or in part, provided
that, after giving effect to such termination or reduction, the Letters of Credit
Outstanding shall not exceed the L/C Sublimit.

 

3.2.         Letter
of Credit Requests. (a) Whenever a Borrower desires that a Letter of Credit
be issued for its account, it shall give the Administrative Agent and the
Letter of Credit Issuer prior to 12:00 Noon at least five (or such lesser
number as may be agreed upon by the Administrative Agent and the Letter of
Credit Issuer) Business Days’ written notice thereof. Each notice shall be
executed by such Borrower and shall be in the form of Exhibit C (each a “Letter
of Credit Request”). Each Letter of Credit Request shall specify (i) the
initial Stated Amount of the Letter of Credit, (ii) the date of issuance (which
shall be a Business Day) and (iii) the currency in which the Letter of Credit
shall be denominated (which shall be the Base Currency or an Alternative
Currency). Upon receipt of a Letter of Credit Request the Administrative Agent
shall confirm there are sufficient Available Commitments and that neither the
HK Dollars Sublimit nor the Singapore Dollars Sublimit will be exceeded after
giving effect to the issuance of the relevant Letter of Credit and the
Administrative Agent shall promptly transmit copies of each Letter of Credit
Request to each Lender.

 

(b)          The making
of each Letter of Credit Request shall be deemed to be a representation and
warranty by the relevant Borrower that the Letter of Credit may be issued in
accordance with, and will not violate the requirements of, Section 3.1(b) and
Section 7.

 

3.3.         Letter
of Credit Participations. (a) Immediately upon the issuance by the Letter
of Credit Issuer of any Letter of Credit, the Letter of Credit Issuer shall be
deemed to have sold and transferred to each other Lender (each such other
Lender, in its capacity under this Section 3.3, an “L/C Participant”),
and each such L/C Participant shall be deemed irrevocably and unconditionally
to have purchased and received from the Letter of Credit Issuer, without
recourse or warranty, an undivided interest and participation (each an “L/C
Participation”), to the extent of such L/C Participant’s Commitment
Percentage in such Letter of Credit, each substitute letter of credit, each
drawing made thereunder and the obligations of the relevant Borrower under this
Agreement with respect thereto, and any security therefor or Guarantee
pertaining thereto; provided that the Letter of Credit Fees will be paid
directly to the Administrative Agent for the ratable account of the L/C
Participants as provided in Section 4.1(b) and the L/C Participants shall have
no right to receive any portion of any Fronting Fees.

 

(b)          Each
Lender and each Borrower agrees that, in paying any drawing under a Letter of
Credit, the Letter of Credit Issuer shall not have any responsibility to obtain
any document (other than any sight draft, certificates and documents expressly
required by the Letter of Credit) or to ascertain or inquire as to the validity
or accuracy of any such document or the authority of the Person executing or
delivering any such document. None of the Letter of Credit Issuer, the
Administrative Agent, any of their respective Related Parties nor any
correspondent, participant or assignee of the Letter of Credit Issuer shall be
liable to any Lender for (i) any action taken or omitted in connection herewith
at the request or with the approval of the Lenders

 

72

 

or the Required Lenders,
as applicable; (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any document or instrument related to any Letter
of Credit or any other document. The Borrowers hereby assume all risks of the
acts or omissions of any beneficiary or transferee with respect to its use of
any Letter of Credit; provided, however, that this assumption is
not intended to, and shall not, preclude any Borrower pursuing such rights and
remedies as it may have against the beneficiary or transferee at law or under
any other agreement. None of the Letter of Credit Issuer, the Administrative
Agent, any of their respective Related Parties nor any correspondent,
participant or assignee of the Letter of Credit Issuer shall be liable or
responsible for any of the matters described in clauses (i) through (v) of
Section 3.3(g); provided, however,  that anything in such
clauses to the contrary notwithstanding, the relevant Borrower may have a claim
against the Letter of Credit Issuer, and the Letter of Credit Issuer may be
liable to such Borrower, to the extent, but only to the extent, of any direct,
as opposed to consequential or exemplary, damages suffered by such Borrower
which were caused by the Letter of Credit Issuer’s willful misconduct or gross
negligence or the Letter of Credit Issuer’s willful failure to pay under any
Letter of Credit after the presentation to it by the beneficiary of a sight
draft and certificate(s) strictly complying with the terms and conditions of a
Letter of Credit. In furtherance and not in limitation of the foregoing, the
Letter of Credit Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the Letter of Credit Issuer shall
not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.

 

(c)          In the
event that the Letter of Credit Issuer makes any payment under any Letter of
Credit issued by it and the relevant Borrower shall not have repaid such amount
in full to the respective Letter of Credit Issuer pursuant to Section 3.4, the
Letter of Credit Issuer shall promptly notify the Administrative Agent and each
L/C Participant of such failure, and each such L/C Participant shall promptly
and unconditionally pay to the Administrative Agent for the account of the
Letter of Credit Issuer, the amount of such L/C Participant’s Commitment
Percentage of such unreimbursed payment in the currency in which such payment
was made by the Letter of Credit Issuer and in immediately available funds. If
the Letter of Credit Issuer so notifies, prior to 11:00 a.m. on any Business
Day, each L/C Participant shall make available to the Administrative Agent for
the account of the Letter of Credit Issuer such L/C Participant’s Commitment
Percentage of the amount of such payment on such Business Day in immediately
available funds. If and to the extent such L/C Participant shall not have so
made its Commitment Percentage of the amount of such payment available to the
Administrative Agent for the account of the Letter of Credit Issuer, such L/C
Participant agrees to pay to the Administrative Agent for the account of the
Letter of Credit Issuer, forthwith on demand, such amount, together with
interest thereon for each day from such date until the date such amount is paid
to the Administrative Agent for the account of the Letter of Credit Issuer at
the Federal Funds Effective Rate. A certificate from the relevant Letter of
Credit Issuer submitted to any L/C Participant (through the Administration
Agent) with respect to amounts owing under this Section 3.3(c) shall be
conclusive absent manifest error. The failure of any L/C Participant to make
available to the

 

73

 

Administrative Agent for
the account of the Letter of Credit Issuer its Commitment Percentage of any
payment under any Letter of Credit shall not relieve any other L/C Participant
of its obligation hereunder to make available to the Administrative Agent for
the account of the Letter of Credit Issuer its Commitment Percentage of any
payment under such Letter of Credit on the date required, as specified above,
but no L/C Participant shall be responsible for the failure of any other L/C
Participant to make available to the Administrative Agent such other L/C
Participant’s Commitment Percentage of any such payment.

 

(d)          With
respect to any Unpaid Drawing that is not fully reimbursed pursuant to Section
3.4 or refinanced by a Borrowing of Loans because the conditions set forth in
Section 7 cannot be satisfied or for any other reason, the relevant Borrower
shall be deemed to have incurred from the relevant Letter of Credit Issuer an
L/C Borrowing in the amount of the Unpaid Borrowing that is not so refinanced,
which L/C Borrowing shall be due and payable on demand (together with interest)
and shall bear interest at the ABR Rate plus the Applicable ABR Margin plus
1% per annum. In such event, each L/C Participant’s payment to the Administrative
Agent for the account of the relevant Letter of Credit Issuer pursuant to
Section 3.3(c) shall be deemed payment in respect of its participation in such
L/C Borrowing and shall constitute an L/C Advance from such Lender in
satisfaction of its participation obligation under this Section 3.3.

 

(e)          Each L/C
Participant’s obligation to make a Loan or L/C Advances to reimburse a Letter
of Credit Issuer for amounts drawn under Letter of Credit, as contemplated by
this Section 3.3(c), shall be absolute and unconditional and shall not be
affected by any circumstance, including (x) any setoff, counterclaim,
recoupment, defense or other right which such L/C Participant may have against
the relevant Letter of Credit Issuer, any Borrower or any other Person for any
reason whatsoever; (y) the occurrence or continuance of a Default or any Event
of Default; or (z) any other occurrence, event or condition, whether or not
similar to any of the foregoing; provided that each Lender’s obligation
to make Loans pursuant to this Section 3.3(c) is subject to the conditions set
forth in Section 7 (other than delivery by the relevant Borrower of a Notice of
Borrowing). No such making of an L/C Advance shall relieve or otherwise impair
the obligation of the relevant Borrower to reimburse the Letter of Credit
Issuer for the amount of any payment made by such Letter of Credit Issuer under
any Letter of Credit, together with interest as provided herein.

 

(f)           Until
each Lender funds its Loan or L/C Advance pursuant to this Section 3.3 to
reimburse the Letter of Credit Issuer for any Unpaid Drawing, interest in
respect of such Lender’s Commitment Percentage of such amount shall be solely
for the account of the Letter of Credit Issuer.

 

(g)          Whenever
the Letter of Credit Issuer receives a payment from a Borrower in respect of an
Unpaid Drawing as to which the Administrative Agent has received for the
account of the Letter of Credit Issuer any L/C Advances from the L/C
Participants pursuant to this Section 3.3, the Letter of Credit Issuer shall
pay to the Administrative Agent and the Administrative Agent shall promptly pay
to each L/C Participant that has paid its Commitment Percentage of such
reimbursement obligation, in the relevant currency and in immediately available
funds, an amount equal to such L/C Participant’s share (based upon the
proportionate aggregate amount originally funded by such L/C Participant to the
aggregate amount funded by

 

74

 

all L/C Participants) of
the principal amount of such Unpaid Drawing and interest thereon accruing after
the purchase of the respective L/C Participations.

 

(h)          The
obligations of the Borrowers to make payments to the Administrative Agent for
the account of a Letter of Credit Issuer with respect to drawings under Letters
of Credit shall be absolute, unconditional and irrevocable and not subject to
counterclaim, set-off or other defense or any other qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of
this Agreement under all circumstances, including under any of the following
circumstances:

 

(i)           any
lack of validity or enforceability of the Letter of Credit, this Agreement or
any of the other Credit Documents;

 

(ii)          the
existence of any claim, set-off, defense or other right that any Credit Party may
have at any time against a beneficiary named in a Letter of Credit, any
transferee of any Letter of Credit (or any Person for whom the beneficiary or
any such transferee may be acting), the Administrative Agent, the relevant
Letter of Credit Issuer, any Lender or other Person, whether in connection with
this Agreement, any Letter of Credit, the transactions contemplated herein or
any unrelated transactions (including any underlying transaction between a
Borrower and the beneficiary named in any such Letter of Credit);

 

(iii)         any draft, demand, certificate or any other
document presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under such Letter
of Credit;

 

(iv)         the
surrender or impairment of any security for the performance or observance of
any of the terms of any of the Credit Documents; or

 

(v)          the
occurrence of any Default or Event of Default.

 

3.4.         Agreement
to Repay Letter of Credit Drawings. Each Borrower hereby agrees to
reimburse the relevant Letter of Credit Issuer, by making payment in the
currency in which the relevant Letter of Credit is issued, to the
Administrative Agent in immediately available funds, for any payment or
disbursement made by the Letter of Credit Issuer under any Letter of Credit
(each such amount so paid until reimbursed, an “Unpaid Drawing”) no later
than the date that is three Business Days after the date on which the relevant
Borrower receives notice of such payment or disbursement (the “Reimbursement
Date”), with interest on the amount so paid or disbursed by the Letter of
Credit Issuer, to the extent not reimbursed prior to 5:00 p.m. on the date of
such payment or disbursement, from and including the date on which such payment
or disbursement was made by the Letter of Credit Issuer to but excluding the
date the Letter of Credit Issuer is reimbursed therefor at a rate per annum that shall at all times be the
Applicable ABR Margin plus the ABR Rate as in effect from time to time, provided
that, notwithstanding anything contained in this Agreement to the contrary, (i)
unless the relevant Borrower shall have

 

75

 

notified the
Administrative Agent and the relevant Letter of Credit Issuer prior to 10:00
a.m. at least two Business Days prior to the Reimbursement Date that such
Borrower intends to reimburse the relevant Letter of Credit Issuer for the amount
of such drawing with funds other than the proceeds of Loans, such Borrower
shall be deemed to have given a Notice of Borrowing requesting that, with
respect to Letters of Credit, the Lenders make Loans on the Reimbursement Date
in the relevant currency in the amount of such Unpaid Drawing which Loans, in
the case of Unpaid Drawings denominated in US Dollars, shall be ABR Loans, in
the case of Unpaid Drawings denominated in the Base Currency, shall be EURIBOR
Loans and in the case of Unpaid Drawings denominated in any Alternative
Currency other than US Dollars, shall be LIBOR Loans; and (ii) the
Administrative Agent shall promptly notify each relevant L/C Participant of
such drawing and the amount of its Loan to be made on the Reimbursement Date in
respect thereof, and each L/C Participant shall be obligated to make a Loan to
the relevant Borrower in the manner deemed to have been requested in the amount
of its Commitment Percentage of the applicable Unpaid Drawing by 12:00 noon on
such Reimbursement Date by making the amount of such Loan available to the
Administrative Agent if, and only if, there are Available Commitments
sufficient to make such Loan and the conditions set forth in Section 7 (other
than the delivery of a Notice of Borrowing) shall be satisfied. Such Loans
shall be made without regard to the Minimum Borrowing Amount or multiples. The
initial interest period for any EURIBOR Loan or LIBOR Loan made pursuant to
this Section 3.4 shall be one month. The Administrative Agent shall use the proceeds
of such Loans solely for purpose of reimbursing the Letter of Credit Issuer for
the related Unpaid Drawing.

 

3.5.         Increased
Costs. If after the date hereof, the adoption of any applicable Law, rule
or regulation, or any change therein, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
actual compliance by the Letter of Credit Issuer or any L/C Participant with
any request or directive made or adopted after the date hereof (whether or not
having the force of law), by any such Governmental Authority, central bank or
comparable agency shall either (a) impose, modify or make applicable any
reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by the Letter of Credit Issuer, or any L/C Participant’s L/C
Participation therein, or (b) impose on the Letter of Credit Issuer or any L/C
Participant any other conditions affecting its obligations under this Agreement
in respect of Letters of Credit or L/C Participations therein or any Letter of
Credit or such L/C Participant’s L/C Participation therein, and the result of
any of the foregoing is to increase the cost to the Letter of Credit Issuer or
such L/C Participant of issuing, maintaining or participating in any Letter of
Credit, or to reduce the amount of any sum received or receivable by the Letter
of Credit Issuer or such L/C Participant hereunder (other than any such
increase or reduction attributable to Taxes) in respect of Letters of Credit or
L/C Participations therein, then, promptly after receipt of written demand to
each relevant Borrower by the Letter of Credit Issuer or such L/C Participant,
as the case may be, (a copy of which notice shall be sent by the Letter of
Credit Issuer or such L/C Participant to the Administrative Agent (with respect
to Letter of Credit issued on account of such Borrower)) such Borrower shall
pay to the Letter of Credit Issuer or such L/C Participant such additional
amount or amounts as will compensate the Letter of Credit Issuer or such L/C
Participant for such increased cost or reduction, it being understood and
agreed, however, that the Letter of Credit Issuer or a L/C Participant shall
not be entitled to

 

76

 

such compensation as a
result of such Person’s compliance with, or pursuant to any request or
directive to comply with, any such Law, rule or regulation as in effect on the
date hereof. A certificate submitted to a Borrower by the relevant Letter of
Credit Issuer or a L/C Participant, as the case may be, (a copy of which
certificate shall be sent by the Letter of Credit Issuer or such L/C
Participant to the Administrative Agent (with respect to Letters of Credit
issued on account of the Borrower)) setting forth in reasonable detail the
basis for the determination of such additional amount or amounts necessary to
compensate the Letter of Credit Issuer or such L/C Participant as aforesaid
shall be conclusive and binding on the Borrower absent clearly demonstrable
error.

 

3.6.         New or
Successor Letter of Credit Issuer.

 

(a)          A Letter
of Credit Issuer may resign as a Letter of Credit Issuer upon 60 days’ prior
written notice to the Administrative Agent, the Lenders and the Company. The
Company may replace a Letter of Credit Issuer for any reason upon five Business
Days written notice to the Administrative Agent and the relevant Letter of
Credit Issuer. The Company may add Letter of Credit Issuers at any time upon
notice to the Administrative Agent. If the Letter of Credit Issuer shall resign
or be replaced, or if a new Letter of Credit Issuer under this Agreement shall
be added in accordance with this Section 3.6, then the Company may appoint from
among the Lenders a successor issuer of Letters of Credit or a new Letter of
Credit Issuer, as the case may be, or, with the consent of the Administrative
Agent (such consent not to be unreasonably withheld), another successor or new
issuer of Letters of Credit, whereupon such successor issuer shall succeed to
the rights, powers and duties of the replaced or resigning Letter of Credit
Issuer under this Agreement and the other Credit Documents, or such new issuer
of Letters of Credit shall be granted the rights, powers and duties of a Letter
of Credit Issuer hereunder, and the term “Letter of Credit Issuer” shall mean
such successor or such new issuer of Letters of Credit effective upon such
appointment. At the time such resignation or replacement shall become
effective, the Company shall pay to the resigning or replaced Letter of Credit
Issuer all accrued and unpaid fees pursuant to Sections 4.1(c) and 4.1(d). The
acceptance of any appointment as a Letter of Credit Issuer hereunder whether as
a successor issuer or new issuer of Letters of Credit in accordance with this Agreement,
shall be evidenced by an agreement entered into by such new or successor issuer
of Letters of Credit, in a form satisfactory to the Company and the
Administrative Agent and, from and after the effective date of such agreement,
such new or successor issuer of Letters of Credit shall become a “Letter of
Credit Issuer” hereunder. After the resignation or replacement of a Letter of
Credit Issuer hereunder, the resigning or replaced Letter of Credit Issuer
shall remain a party hereto and shall continue to have all the rights and
obligations of a Letter of Credit Issuer under this Agreement and the other
Credit Documents with respect to Letters of Credit issued by it prior to such
resignation or replacement, but shall not be required to issue additional
Letters of Credit. In connection with any resignation or replacement pursuant
to this clause (a) (but, in case of any such resignation, only to the extent
that a successor issuer of Letters of Credit shall have been appointed), either
(i) the Company, the resigning or replaced Letter of Credit Issuer and the
successor issuer of Letters of Credit shall arrange to have any outstanding
Letters of Credit issued by the resigning or replaced Letter of Credit Issuer
replaced with Letters of Credit issued by the successor issuer of Letters of
Credit or (ii) the Company shall cause the successor issuer of Letters of
Credit, if such successor issuer is reasonably satisfactory to the replaced or
resigning Letter of Credit Issuer, to issue “back-stop”

 

77

 

Letters of Credit, in a
form and substance reasonably satisfactory to the resigning or replaced Letter
of Credit, naming the resigning or replaced Letter of Credit Issuer as
beneficiary for each outstanding Letter of Credit issued by the resigning or
replaced Letter of Credit Issuer, which new Letters of Credit shall have a face
amount equal to the Letters of Credit being back-stopped and the sole
requirement for drawing on such new Letters of Credit shall be a drawing on the
corresponding back-stopped Letters of Credit. After any resigning or replaced
Letter of Credit Issuer’s resignation or replacement as Letter of Credit
Issuer, the provisions of this Agreement relating to a Letter of Credit Issuer
shall inure to its benefit as to any actions taken or omitted to be taken by it
(A) while it was a Letter of Credit Issuer under this Agreement or (B) at any
time with respect to Letters of Credit issued by such Letter of Credit Issuer.

 

(b)          To the
extent that there are, at the time of any resignation or replacement as set
forth in clause (a) above, any outstanding Letters of Credit, nothing herein
shall be deemed to impact or impair any rights and obligations of any of the
parties hereto with respect to such outstanding Letters of Credit (including,
without limitation, any obligations related to the payment of Fees or the
reimbursement or funding of amounts drawn), except that the Company, the
resigning or replaced Letter of Credit Issuer and the successor issuer of
Letters of Credit shall have the obligations regarding outstanding Letters of
Credit described in clause (a) above.

 

3.7.         Issuance
By Affiliates. In the event that any Letter of Credit is issued by an
Affiliate of a Letter of Credit Issuer on behalf of such Letter of Credit
Issuer as contemplated by the definition of “Letter of Credit Issuer” all of
the provisions of this Agreement applicable to Letter of Credit Issuers shall
apply to and be enforceable by any such Affiliate.

 

SECTION 4.         Fees;
Commitments

 

4.1.         Fees.
(a) (i) The Company agrees to pay to the Administrative Agent in the Base
Currency, for the account of each Lender (in each case pro rata according to the respective
Commitments of all such Lenders), a commitment fee for each day from and
including the Closing Date to but excluding the Termination Date. Such
commitment fee shall be payable in arrears (x) on the last day of each March,
June, September and December (for the three-month period (or portion thereof)
ended on such day for which no payment has been received), (y) on the cancelled
amount of the relevant Lender’s Commitment on the date on which such Commitment
is cancelled pursuant to this Agreement and (z) on the Termination Date (for
the period ended on such date for which no payment has been received pursuant
to clause (x) above), and shall be computed for each day during such period at
a rate per annum equal to the
Commitment Fee Rate in effect on such day on the Available Commitments in
effect on such day.

 

(ii)          Notwithstanding
the foregoing, (i) any commitment fee accrued with respect to any of the
Commitments of a Defaulting Lender during the period prior to the time such
Lender became a Defaulting Lender and unpaid at such time shall not be payable
by the Company so long as such Lender shall be a Defaulting Lender except to
the extent that such commitment fee shall otherwise have been due and payable
by the Company prior to such time, and (ii) no commitment fee shall accrue on
any of the

 

78

 

Available Commitment of a
Defaulting Lender so long as such Lender shall be a Defaulting Lender.

 

(b)          The
Company agrees to pay to the Administrative Agent in the Base Currency for the
account of the Lenders pro rata on
the basis of their respective Letter of Credit Exposure, a fee in respect of
each Letter of Credit (the “Letter of Credit Fee”), for the period from
and including the date of issuance of such Letter of Credit to but excluding
the termination date of such Letter of Credit computed at the per annum rate for each day equal to the
Applicable LIBOR Margin for Loans minus 0.125%
per annum on the average daily Stated Amount of such Letter of
Credit. Such Letter of Credit Fees shall be due and payable quarterly in
arrears on the last day of each March, June, September and December and on the
date upon which the Total Commitment terminates and the Letters of Credit
Outstanding shall have been reduced to zero.

 

(c)          The
Company agrees to pay to the Administrative Agent in the Base Currency for the
account of each Letter of Credit Issuer a fee in respect of each Letter of
Credit issued by it (the “Fronting Fee”), for the period from and
including the date of issuance of such Letter of Credit to but excluding the
termination date of such Letter of Credit, computed at the rate for each day
equal to 0.125% per annum on the
average daily Stated Amount of such Letter of Credit (or at such other rate per
annum as agreed in writing between the Company and the Letter of Credit
Issuer). Such Fronting Fees shall be due and payable quarterly in arrears on
the last day of each March, June, September and December and on the date upon
which the Total Commitment terminates and the Letters of Credit Outstanding
shall have been reduced to zero.

 

(d)          The
Company agrees to pay directly to the Letter of Credit Issuer in the Base
Currency upon each issuance of, drawing under, amendment and/or cancellation
of, a Letter of Credit issued by it such amount as the Letter of Credit Issuer
and the Company shall have agreed upon for issuances of, drawings under or
amendments of, Letters of Credit issued by it.

 

4.2.         Voluntary
Reduction of Commitments. Upon at least three Business Days prior written
notice (or telephonic notice promptly confirmed in writing) to the
Administrative Agent at the Administrative Agent’s Office (which notice the
Administrative Agent shall promptly transmit to each of the Lenders), the
Company (on behalf of each of the Borrowers) shall have the right, without
premium or penalty, permanently to terminate or reduce the Commitments in whole
or in part, provided that (a) any such reduction shall apply proportionately
and permanently to reduce the Commitment of each of the Lenders, (b) any
partial reduction pursuant to this Section 4.2 shall be in the amount of at
least €5,000,000 and in integral multiples of €1,000,000 in excess thereof, (c)
after giving effect to such termination or reduction and to any prepayments of
the Loans made on the date thereof in accordance with this Agreement, the
aggregate amount of the Lenders’ Credit Exposures shall not exceed the Total
Commitment and (d) if, after giving effect to any reduction of the Commitments,
the Singapore Dollar Sublimit, the L/C Sublimit or the Holdings Borrowing Limit
exceeds the amount of the Total Commitments, such limit or sublimit (as
applicable) shall be automatically reduced by the amount of such excess. The
amount of any such reduction in the Total Commitment reduction shall not be
applied to the Singapore Dollar Sublimit or the L/C Sublimit unless otherwise
specified by the Company.

 

79

 

4.3.         Mandatory
Termination of Commitments. The Total Commitment shall terminate at 5:00
p.m. on the Maturity Date.

 

SECTION 5.         Payments

 

5.1.         Voluntary
Prepayments. A Borrower shall have the right to prepay Loans, without
premium or penalty, in whole or in part from time to time on the following
terms and conditions: (a) such Borrower shall give the Administrative Agent and
at the Administrative Agent’s Office written notice (or telephonic notice
promptly confirmed in writing) of its intent to make such prepayment, the
amount of such prepayment and (in the case of LIBOR Loans or EURIBOR Loans) the
specific Borrowing(s) to be prepaid, which notice shall be given by such
Borrower no later than (i) in the case of EURIBOR Loans, 10:00 a.m. two
Business Days prior to, or (ii) in the case of LIBOR Loans denominated (x) in
Dollars, 10:00 a.m. three Business Days, and (y) in an Alternative Currency,
10:00 a.m. five Business Days prior to, the date of such prepayment and shall
promptly be transmitted by the Administrative Agent to each of the Lenders; (b)
each partial prepayment of any LIBOR Loans or EURIBOR Loans shall be in an
integral multiple of €1,000,000 (or its equivalent in an Alternative Currency)
and in an aggregate principal amount of at least €5,000,000 (or its equivalent
in an Alternative Currency) and each partial prepayment of ABR Loans shall be
in an integral multiple of $100,000 and in an aggregate principal amount of at
least $500,000 or, in each case, if less, the entire principal amount thereof
then outstanding, provided that no partial prepayment of Loans made
pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant
to such Borrowing to an amount less than the applicable Minimum Borrowing
Amount, and (c) any prepayment of LIBOR Loans or EURIBOR Loans pursuant to this
Section 5.1 on any day other than the last day of an Interest Period applicable
thereto shall be subject to compliance by the relevant Borrower with the
applicable provisions of Section 2.11. Each such prepayment shall be applied to
the Lenders’ participation in each such Loan pro rata. At the relevant
Borrower’s election in connection with any prepayment pursuant to this Section
5.1, such prepayment shall not be applied to any Loan of a Defaulting Lender.

 

5.2.         Mandatory
Prepayments and Cash Collateral. (a) If on any Revaluation Date the
aggregate amount of the Lenders’ Credit Exposures (such aggregate Credit
Exposures, the “Aggregate Outstandings”) exceeds 100% of the Total
Commitment as then in effect, the Borrowers shall forthwith repay on such
Revaluation Date a principal amount of Loans in an amount (in the Base
Currency) equal to such excess. If, after giving effect to the prepayment of
all outstanding Loans, the Aggregate Outstandings exceed the Total Commitment
then in effect, the Company shall Cash Collateralize the then Letters of Credit
Outstanding in an amount (in the Base Currency) equal to such excess.

 

(b)          In
addition to the obligations under clause (a) above:

 

(i)           if,
as of the L/C Maturity Date, there shall be any Letters of Credit Outstanding
for any reason, the Company shall immediately Cash Collateralize the full
amount of the then Letters of Credit Outstanding; and

 

80

 

(ii)          if
the Administrative Agent notifies the Company on any Revaluation Date that the
Letters of Credit Outstanding (in the Base Currency) at such time exceeds the
L/C Sublimit then in effect, then, within two Business Days after receipt of
such notice, the Company shall Cash Collateralize the then Letters of Credit
Outstanding in an amount equal to the amount by which the then Letters of
Credit Outstanding exceeds the L/C Sublimit.

 

(c)          As used
herein, “Cash Collateralize” means to pledge and deposit with or deliver
to the Administrative Agent, for the benefit of the Letter of Credit Issuers
and the Lenders, as collateral for the obligations of the Borrowers in respect
of the Letters of Credit Outstanding, cash or deposit account balances pursuant
to documentation in form and substance satisfactory to the Administrative Agent
and the Letter of Credit Issuers which documents are hereby consented to by the
Lenders and which shall permit certain Investments in Permitted Investments
satisfactory to the Administrative Agent, until the proceeds are applied to the
Secured Obligations. Derivatives of such term have corresponding meanings. Each
Borrower hereby grants to the Administrative Agent, for the benefit of each
Letter of Credit Issuer and the Lenders, a security interest in all such cash,
deposit accounts and all balances therein and all proceeds of the foregoing.
Cash Collateral shall be maintained in blocked, non-interest bearing deposit
accounts at the Administrative Agent (or an Affiliate thereof).

 

(d)          Any
prepayment of a LIBOR Loan or EURIBOR Loan pursuant to this Section on a day
other than the last day of the Interest Period applicable thereto shall be
subject to compliance by the relevant Borrower with the applicable provisions
of Section 2.11.

 

(e)          With
respect to each prepayment of Loans by a Borrower pursuant to Section 5.2(a),
such Borrower may designate the Types of Loans that are to be prepaid and the
specific Borrowing(s) pursuant to which made, provided that (y) each
prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata among such Loans; and (z)
notwithstanding the provisions of the preceding clause (y), no prepayment made
pursuant to Section 5.2(a) of Loans shall be applied to the Loans of any
Defaulting Lender. In the absence of a designation by the relevant Borrower as
described in the preceding sentence, the Administrative Agent shall, subject to
the above, make such designation in its reasonable discretion with a view, but
no obligation, to minimize breakage costs owing under Section 2.11.

 

(f)           In lieu
of making any payment pursuant to this Section 5.2 in respect of any LIBOR Loan
or EURIBOR Loan other than on the last day of the Interest Period therefor and
so long as no Event of Default shall have occurred and be continuing, the
relevant Borrower, at its option may deposit with the Administrative Agent an
amount equal to the amount of the LIBOR Loan or EURIBOR Loan to be prepaid and
such LIBOR Loan or EURIBOR Loan (as the case may be) shall be repaid on the
last day of the Interest Period therefor in the required amount with the
proceeds of the amount so deposited. Such deposit shall be held by the
Administrative Agent in a corporate time deposit account established on terms
reasonably satisfactory to the Administrative Agent, earning interest at the
then-customary rate for accounts of such type. Such deposit shall constitute
cash collateral for the Secured Obligations, provided that the relevant
Borrower may at any time direct that such deposit be applied to make the

 

81

 

applicable payment
required pursuant to this Section 5.2 (subject, in all cases, to compliance by
the relevant Borrower with Section 2.11).

 

5.3.         Method
and Place of Payment. (a) Except as otherwise specifically provided herein,
all payments under this Agreement shall be made by each Borrower, without
set-off, counterclaim or deduction of any kind, to the Administrative Agent for
the ratable account of the Lenders entitled thereto or the Letter of Credit
Issuer entitled thereto, as the case may be, not later than 12:00 Noon on the date
when due and shall be made in immediately available funds at the Administrative
Agent’s Office or at such other office as the Administrative Agent shall
specify for such purpose by notice to the Borrowers, it being understood that
written or facsimile notice by a Borrower to the Administrative Agent to make a
payment from the funds in such Borrower’s account at the Administrative Agent’s
Office shall constitute the making of such payment to the extent of such funds
held in such account. All repayments or prepayments of Loans (whether of
principal, interest or otherwise) hereunder shall be made in the currency in
which such amounts are denominated. The Administrative Agent will thereafter
cause to be distributed on the same day (if payment was actually received by
the Administrative Agent prior to 12:00 noon on such day) like funds relating
to the payment of principal or interest or Fees ratably to the Lenders entitled
thereto. If, for any reason, any Borrower is prohibited by any Law from making
any required payment hereunder in an Alternative Currency, such Borrower shall
make such payment in the Base Currency Equivalent of such amount.

 

(b)          Any
payments under this Agreement that are made later than 1:00 p.m. shall be
deemed to have been made on the next succeeding Business Day. Whenever any
payment to be made hereunder shall be stated to be due on a day that is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day and, such extension of time shall be reflected in computing
interest or fees (as the case may be) at the applicable rate in effect
immediately prior to such extension.

 

5.4.         Net
Payments. (a) Any and all payments made by or on behalf of any Credit Party
under this Agreement or any other Credit Document shall be made free and clear
of, and without deduction or withholding for or on account of, any Indemnified
Taxes; provided that if a Credit Party shall be required by law to
deduct or withhold any Indemnified Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required
deductions and withholdings (including deductions or withholdings applicable to
additional sums payable under this Section 5.4), the Administrative Agent, any
Collateral Agent or any Lender, as the case may be, receives an amount equal to
the after tax sum it would have received had no such deductions or withholdings
been made, (ii) the relevant Credit Party shall make such deductions or
withholdings and (iii) the relevant Credit Party shall pay the full amount
deducted or withheld to the relevant Governmental Authority in accordance with
applicable law. Whenever any Indemnified Taxes are payable by a Credit Party,
as promptly as possible thereafter, such Credit Party shall send to the Administrative
Agent for its own account or for the account of such Lender, as the case may
be, a certified copy of an original official receipt in such form as provided
in the ordinary course by the relevant Governmental Authority and as is
reasonably available to the relevant Credit Party (or other evidence acceptable
to such Lender, acting reasonably) received by such Credit Party showing
payment thereof.

 

82

 

(b)          Each
Credit Party shall pay and shall jointly and severally indemnify and hold
harmless, on an after tax basis, the Administrative Agent, each Collateral
Agent and each Lender (whether or not such Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority) with regard
to any Other Taxes.

 

(c)          Each
Credit Party shall jointly and severally indemnify and hold harmless, on an
after tax basis, the Administrative Agent, each Collateral Agent and each
Lender within 15 Business Days after written demand therefor, for the full
amount of any Indemnified Taxes imposed on the Administrative Agent, each
Collateral Agent or such Lender as the case may be, on or with respect to any
payment by or on account of any obligation of any Credit Party hereunder or
under any other Credit Document (including Indemnified Taxes imposed or asserted
on or attributable to amounts payable under this Section 5.4) and any
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. Upon the request of any Borrower, such
Administrative Agent, Collateral Agent, or a Lender must provide details of how
it calculated the amount of Indemnified Taxes for which it claimed liability
under this Section 5.4. A certificate as to the amount of such payment or
liability delivered to a Credit Party by a Lender or by the Administrative
Agent or a Collateral Agent on its own behalf or on behalf of a Lender shall be
conclusive absent manifest error.

 

(d)          Each
Lender shall to the extent it is legally entitled to do so:

 

(i)           upon
the request of any Borrower or the Administrative Agent deliver to the
Borrowers and the Administrative Agent two copies of any certification,
information, documents or other evidence concerning the nationality, residence
or identity of such Lender or make any declaration of similar claim or satisfy
any other reporting requirement relating to such matters, which is required by
a statute, regulation or administrative practice of a relevant Governmental
Authority as a precondition to exemption from all or a part of any Taxes,
assessment or other governmental charge; and

 

(ii)          deliver
to the Borrowers and the Administrative Agent two further copies of any such
form or certification (or any applicable successor form) on or before the date
that any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form previously
delivered by it to any Borrower;

 

unless in any such case
any Change in Law has occurred prior to the date on which any such delivery
would otherwise be required that renders any such form inapplicable or would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender so advises the Borrowers and the Administrative
Agent. Each Person that shall become a Participant pursuant to Section 13.7 or
a Lender pursuant to Section 13.7 shall, upon the effectiveness of the related
transfer, be required to provide all the forms and statements required pursuant
to this Section 5.4(d), provided that in the case of a Participant such
Participant shall furnish all such required forms and statements to the Lender
from which the related participation shall have been purchased.

 

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(e)          If a
Credit Party determines in good faith that a reasonable basis exists for
contesting any taxes for which indemnification has been demanded hereunder or
any other Credit Document, the relevant Lender, the Administrative Agent or a
Collateral Agent, as applicable, shall cooperate with such Credit Party in
challenging such taxes at such Credit Party’s expense if so requested by such
Credit Party. If any Lender, the Administrative Agent or a Collateral Agent, as
applicable, receives a refund of, or determines that a Tax Credit is available
to it with respect to, a tax for which a payment has been made by a Credit
Party pursuant to this Agreement, which refund or Tax Credit in the good faith
judgment of such Lender, the Administrative Agent or a Collateral Agent, as the
case may be, is attributable to such payment made by such Credit Party, then
the Lender, the Administrative Agent or a Collateral Agent, as the case may be,
shall reimburse such Credit Party for such amount (together with any interest
received thereon) as the Lender, the Administrative Agent or a Collateral
Agent, as the case may be, determines to be the proportion of the refund or Tax
Credit as will leave it, after such reimbursement, in no better or worse
position (taking into account expenses or any taxes imposed on the refund) than
it would have been in if the payment had not been required. A Lender, the
Administrative Agent or a Collateral Agent shall claim any refund or Tax Credit
that it determines is available to it, unless it concludes in its reasonable
discretion that it would be adversely affected by making such a claim. Neither
the Lender, the Administrative Agent nor any Collateral Agent shall be obliged
to disclose any information regarding its tax affairs or computations to the
any Credit Party in connection with this paragraph (e) or any other provision
of this Section 5.4.

 

(f)           The
agreements in this Section 5.4 shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.

 

5.5.         Computations
of Interest and Fees. (a)
Interest on LIBOR Loans, EURIBOR Loans and, except as provided in the next
succeeding sentence, ABR Loans shall be calculated on the basis of a 360-day
year for the actual days elapsed. Interest on ABR Loans in respect of which the
rate of interest is calculated on the basis of the Prime Rate and interest on
overdue interest shall be calculated on the basis of a 365- (or 366-, as the
case may be) day year for the actual days elapsed.

 

(b)          Fees
and Letters of Credit Outstanding shall be calculated on the basis of a 360-day
year for the actual days elapsed.

 

5.6.         Limit
on Rate of Interest.

 

(a)          No
Payment shall exceed Lawful Rate. Notwithstanding any other term of this Agreement, no Borrower shall be
obliged to pay any interest or other amounts under or in connection with this
Agreement in excess of the amount or rate permitted under or consistent with
any applicable law, rule or regulation.

 

(b)          Payment
at Highest Lawful Rate. If a
Borrower is not obliged to make a payment which it would otherwise be required
to make, as a result of Section 5.6(a), such Borrower shall make such payment
to the maximum extent permitted by or consistent with applicable laws, rules
and regulations.

 

84

 

(c)          Adjustment
if any Payment exceeds Lawful Rate. If any provision of this Agreement or any of the other Credit
Documents would obligate any Borrower to make any payment of interest or other
amount payable to any Lender in an amount or calculated at a rate which would
be prohibited by any applicable Law, rule or regulation, then notwithstanding
such provision, such amount or rate shall be deemed to have been adjusted with
retroactive effect to, in the case of EURIBOR Loans and LIBOR Loans, the
beginning of the relevant Interest Period or, in the case of ABR Loans, the
relevant date, the maximum amount or rate of interest, as the case may be, as
would not be so prohibited by Law, such adjustment to be effected, to the
extent necessary, by reducing the amount or rate of interest required to be
paid by such Borrower to the affected Lender under Section 2.8.

 

Notwithstanding
the foregoing, and after giving effect to all adjustments contemplated thereby,
if any Lender shall have received from any Borrower an amount in excess of the
maximum permitted by any applicable Law, rule or regulation, then such Borrower
shall be entitled, by notice in writing to the Administrative Agent to obtain
reimbursement from that Lender in an amount equal to such excess, and pending
such reimbursement, such amount shall be deemed to be an amount payable by that
Lender to such Borrower.

 

5.7.         Currency
Indemnity

 

(a)          If any
sum due from a Credit Party under the Credit Documents (a “Sum”), or any
order, judgment or award given or made in relation to a Sum, has to be
converted from the currency (the “First Currency”) in which that Sum is
payable into another currency (the “Second Currency”) for the purpose
of: (i) making or filing a claim or proof against that Credit Party; (ii)
obtaining or enforcing an order, judgment or award in relation to any litigation
or arbitration proceedings, in either case that Credit Party shall as an
independent obligation, within three Business Days of demand, indemnify each
Lender to whom that Sum is due against any cost, loss or liability arising out
of or as a result of the conversion including any discrepancy between (A) the
rate of exchange used to convert that Sum from the First Currency into the
Second Currency and (B) the rate or rates of exchange available to that person
at the time of its receipt of that Sum.

 

(b)          Each
Credit Party waives any right it may have in any jurisdiction to pay any amount
under the Credit Documents in a currency or currency unit other than that in
which it is expressed to be payable.

 

SECTION 6.         Conditions
Precedent to Initial Borrowing

 

The occurrence of the initial Credit Event under this Agreement is
subject to the satisfaction of the following conditions precedent (subject to
the final paragraph of this Section 6), except as otherwise agreed in writing
between the Company and the Administrative Agent. The Administrative Agent
shall, upon such conditions precedent being satisfied, promptly confirm such
satisfaction in writing to the Lenders and the Company.

 

6.1.         Credit
Documents. The Administrative
Agent shall have received:

 

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(a)          this
Agreement, executed and delivered by a duly authorized signatory of each
Borrower and each Lender;

 

(b)          the
Guaranty, executed and delivered by a duly authorized signatory of each
Guarantor;

 

(c)          the
Collateral Agency Agreement, executed and delivered by a duly authorized
signatory of each party thereto; and

 

(d)          each
of the Security Documents set forth on Schedule 1.l(e), executed and delivered
by a duly authorized signatory of each party thereto.

 

6.2.         Acquisition
Agreement. The Acquisition
Agreement (which, solely for the purposes of this Section 6.2, shall mean the
execution version of the Acquisition Agreement dated as of September 27, 2006),
the Acquisition Side Letter (in the form in effect on the date hereof) and the
other agreements, instruments and documents relating to the Transactions shall
not, in any case, have been altered, amended or otherwise changed or
supplemented or any condition therein waived, or any right or power exercised
pursuant to Section 6.3 of the Acquisition Agreement, in a manner materially
adverse to the Lenders without the prior written consent of the Joint Lead
Arrangers. Evidence shall be provided that all conditions precedent to the
Reorganization, Refinancing and the Acquisition (other than as to funding) have
been satisfied and that the Reorganization, Refinancing and Acquisition have
been (or will immediately after funding be) consummated in accordance with the
terms of the Acquisition Agreement and the Acquisition Side Letter (in the form
in effect on the date hereof) without any modification that is materially
adverse to the Lenders (it being acknowledged and agreed that closing of the
acquisition of the ownership interests in Jilin and ASMC in accordance with the
terms of the Acquisition Agreement is not materially adverse to the Lenders);
and that the Reorganization, to the extent not finalized on the date hereof
(and except with respect to any actions or steps specifically contemplated in
the schedules to the Acquisition Agreement or in the Acquisition Side Letter
(in the form in effect on the date hereof) or to be taken after the Closing
Date), be finalized in a manner that does not have a material adverse effect on
the Guaranty and Liens created or to be created under the Security Documents,
as a whole, from that contemplated under the Commitment Letter as of the date
thereof (except with the prior written consent of the Joint Lead Arrangers).

 

6.3.         Indebtedness. No Indebtedness or financing preferred stock
of Holdings or its Subsidiaries to third parties shall remain outstanding as of
the Closing Date (after giving effect to the Transactions) and no shareholder
loans shall have been made without the consent of the Joint Lead Arrangers,
other than (i) Indebtedness pursuant to this Agreement, (ii) the Bridge
Facilities, (iii) the Senior Notes, (iv) Indebtedness outstanding on August 3,
2006, (v) Indebtedness owed to the Seller pursuant to the Acquisition Agreement
which will be repaid in full to complete the Reorganization in accordance with
the Acquisition Agreement and (vi) other Indebtedness not exceeding €50,000,000.

 

6.4.         Solvency
Certificate. On the Closing Date, the Administrative Agent shall have
received a certificate from an Authorized Officer of the Company in a form

 

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reasonably satisfactory
to the Administrative Agent demonstrating that after giving effect to the
consummation of the Transactions, the Company on a consolidated basis with its
Subsidiaries is solvent.

 

6.5.         Legal
Opinions. The Administrative Agent shall have received the executed legal
opinions of (a) Sullivan & Cromwell LLP, special New York counsel to the
Borrowers, (b) Sullivan & Cromwell LLP, special German counsel to the
Borrowers, (c) De Brauw Blackstone Westbroek N.V., special Dutch counsel to the
Borrowers, (d) Davis Polk & Wardwell, special French counsel to the
Lenders, (e) Slaughter and May, special Hong Kong counsel to the Lenders, (f)
SyCip Salazar Hernandez & Gatmaitan, special Philippines counsel to the
Lenders, (g) Allen & Gledhill, special Singapore counsel to the Lender, (h)
Russin & Vecchi, special Taiwan counsel to the Lenders, (i) Linklaters,
special Thailand counsel to the Lenders, and (j) Slaughter and May, special
English counsel to the Lenders; in each case in a form and substance reasonably
satisfactory to the Administrative Agent and, in each case, to the extent
applicable to entities that are Credit Parties on the Closing Date. The
Borrowers, the other Credit Parties and the Administrative Agent hereby
instruct such counsel to deliver such legal opinions.

 

6.6.         Closing
Certificates. The Administrative Agent shall have received a certificate of
each Credit Party, dated the Closing Date, substantially in the form of Exhibit
D, with appropriate insertions, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of such Credit Party (or where
customary in the relevant jurisdiction, executed by a director of such Credit
Party), and attaching the documents referred to in Sections 6.7 and 6.8 below.

 

6.7.         Corporate
Proceedings of Each Credit Party. The Administrative Agent shall have
received a copy of the resolutions, in form and substance satisfactory to the
Administrative Agent, of the Board of Directors and, to the extent required
under applicable Law or the organizational documents of any Credit Party, the
shareholders and/or the supervisory board of directors of each Credit Party (or
a duly authorized committee thereof) authorizing (a) the execution, delivery
and performance of the Credit Documents (and any agreements relating thereto)
to which it is a party and (b) in the case of the Borrowers, the extensions of
credit contemplated hereunder.

 

6.8.         Corporate
Documents. The Administrative Agent shall have received true and complete
copies of the certificate of incorporation, by-laws (or equivalent
organizational documents) and, to the extent available in the relevant
jurisdiction, an extract of the trade register of each Credit Party.

 

6.9.         Collateral.
All documents and instruments, including Uniform Commercial Code or other
applicable personal property and fixture security financing statements,
required by Law or reasonably requested by a Collateral Agent, as applicable,
to be filed, registered or recorded in any relevant jurisdiction to create the Liens
intended to be created by the Security Documents and perfect such Liens to the
extent required by, and with the priority required by, the Security Documents,
shall have been filed, registered or recorded or delivered to such Collateral
Agent for filing, registration or recording, subject to the Agreed Security
Principles.

 

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6.10.       Fees.
The Agents and Lenders shall have received evidence that the fees in the
amounts previously agreed in writing by the Agents and such Lenders to be
received on the Closing Date and all expenses for which the Borrowers are
responsible and in relation to which invoices have been presented prior to the
Closing Date shall be paid on the Closing Date, and Holdings and its
Subsidiaries that are party thereto shall have complied in all material
respects with all of the other terms of the Fee Letter to be complied with on
or before the Closing Date.

 

6.11.       Bridge
Loans and Senior Notes. The Administrative Agent shall have received
satisfactory evidence of receipt by the Borrowers of (or the issuance by the
Borrowers of irrevocable borrowing requests in respect of) not less than
€1,500,000,000 and US$3,842,580,000 of cash proceeds from the advance of the
Bridge Loans or the issuance of the Senior Notes.

 

6.12.       Know
Your Customer. The Lenders shall have received such documentation and other
evidence as shall have been reasonably requested in order for each such Lender
to carry out and be satisfied with the results of all necessary “know your
customer” or other similar identification procedures.

 

Notwithstanding
anything in this Section 6, to the extent any Liens over the intended
Collateral or any action or deliverable related to the creation or perfection
of Liens over the intended Collateral (other than any Collateral the Liens over
which may be perfected by the filing of a UCC financing statement or, subject
to the Agreed Security Principles, the delivery of stock certificates and the
Security Document giving rise to the Lien therein) or any Guarantee is not
provided on the Closing Date after use by the Borrowers and the other Credit
Parties of commercially reasonable efforts to do so, the provision of any such
Lien or deliverable or Guarantee shall not constitute a condition precedent to
the initial Credit Event under this Agreement but shall be required to be
delivered as soon as reasonably practicable, and in any event not later than 90
days or, in the case of the Security Documents set forth in paragraphs 5(b) and
5(c) of Schedule 6.12, seven months, after the Closing Date (or, in any such
case, such longer period as may be agreed by the Administrative Agent with the
consent of the Required Lenders); it being acknowledged and agreed that the
Guarantees and Security Documents set forth on Schedule 6.12 shall not be
provided on the Closing Date but shall be delivered within such period.

 

SECTION 7.         Conditions
Precedent to All Credit Events and Certain Funds

 

The agreement of
each Lender to make any Loan requested to be made by it on any date and the
obligation of the Letter of Credit Issuer to issue Letters of Credit on any
date is subject to the satisfaction of the following conditions precedent:

 

7.1.         No
Default, Representations and Warranties. At the time of each Credit Event
and also after giving effect thereto (subject to Section 7.3 in the case of
Credit Events on the Closing Date) (a) no Default or Event of Default shall
have occurred and be continuing and (b) all representations and warranties made
by any Credit Party contained herein or in the other Credit Documents shall be true
and correct in all material respects with the same effect as though

 

88

 

such representations and
warranties had been made on and as of the date of such Credit Event (except
where such representations and warranties expressly relate to an earlier date,
in which case such representations and warranties shall have been true and
correct in all material respects as of such earlier date).

 

7.2.         Notice
of Borrowing, Letter of Credit Request. (a) Prior to the making of each
Loan, the Administrative Agent shall have received a Notice of Borrowing
(whether in writing or by telephone) meeting the requirements of Section 2.3.

 

(b)          Prior to
the issuance of each Letter of Credit, the Administrative Agent and the Letter
of Credit Issuer shall have received a Letter of Credit Request meeting the
requirements of Section 3.2(a).

 

The acceptance of the
benefits of each Credit Event shall constitute a representation and warranty by
each Credit Party to each of the Lenders that all the applicable conditions
specified above exist as of that time.

 

7.3.         Certain
Funds. Subject only to satisfaction of the conditions set forth in Section
6, during the period from and including the date of this Agreement to and
including the earlier of March 31, 2007 and the Closing Date (the “Certain
Funds Period”) and notwithstanding any other provision of the Credit
Documents to the contrary, no Lender may refuse to lend in accordance with its
obligations under this Agreement, cancel any of its Commitment, exercise any
right to rescission, termination or similar right or remedy or any other right
of enforcement which it may have in relation to its rights and obligations
under this Agreement, accelerate, make demand or cause or require repayment or
prepayment of any Loan or exercise any right of set-off or counterclaim in
respect of any facility unless:

 

(a)          any Major
Default is continuing unremedied and unwaived;

 

(b)          it is
unlawful for that Lender to perform any of its obligations under the Credit
Documents;

 

(c)          any
termination right which may be exercised by the Company or Holdings has arisen
under the Acquisition Agreement unless the Lenders have agreed that the Company
or Holdings may not exercise such right (other than such right waived
consistent with Section 6.2); or

 

(d)          a Change
of Control occurs,

 

provided
that upon the expiry of the Certain Funds Period (subject to the Clean-up
Period) all such rights, remedies and entitlements shall be available to the
Lenders notwithstanding that they may not have been used or been available for
use during the Certain Funds Period.

 

SECTION 8.         Representations,
Warranties and Agreements

 

In order to induce
the Lenders and Letter of Credit Issuers to enter into this Agreement, to make
the Loans and issue or participate in Letters of Credit as provided for herein,

 

89

 

each Borrower makes the
following representations and warranties to, and agreements with, the Lenders,
each Agent, each Letter of Credit Issuer, all of which shall survive the
execution and delivery of this Agreement and the making of the Loans and the
issuance of the Letters of Credit:

 

8.1.         Organization;
Powers. Each of the Credit Parties (a) is a partnership, limited liability
company, exempted company or corporation duly organized, validly existing and
in good standing (or, if applicable in a foreign jurisdiction, enjoys the
equivalent status under the laws of any jurisdiction of organization outside
the United States) under the laws of the jurisdiction of its organization and
(b) has the power and authority to execute, deliver and perform its obligations
under each of the Credit Documents and each other agreement or instrument
contemplated thereby to which it is or will be a party and, in the case of the
Borrowers, to borrow and otherwise obtain credit hereunder.

 

8.2.         Authorization.
The execution, delivery and performance by each of the Credit Parties of each
of the Credit Documents to which it is a party, and the borrowings and
extensions of credit hereunder (a) have been duly authorized by all corporate,
stockholder, shareholder, limited liability company or partnership action
required to be obtained by each Credit Party and (b) will not (i) violate (A)
any material provision of any material law, statute, rule or regulation, or of
the certificate or articles of incorporation or other constitutive documents or
by-laws of any Credit Party, (B) any applicable order of any court or any rule,
regulation or order of any Governmental Authority or (C) any provision of any
indenture, certificate of designation for preferred stock, agreement or other
instrument to which any Credit Party is a party or by which any or any of their
property is or may be bound, except for any such conflict, breach or default
described in this paragraph (C) that could not reasonably be expected to have a
Material Adverse Effect or otherwise have a material adverse effect on the
rights and remedies of the Lenders under the Credit Documents, (ii) be in
conflict with, result in a breach of or constitute (alone or with notice or
lapse of time or both) a default under, give rise to a right of or result in
any cancellation or acceleration of any right or obligation (including any
payment) or to a loss of a benefit under any such indenture, certificate of
designation for preferred stock, agreement or other instrument, except for any
such conflict, breach or default described in this sub-clause (ii) that could
not reasonably be expected to have a Material Adverse Effect or otherwise have
a material adverse effect on the rights and remedies of the Lenders under the
Credit Documents, or (iii) result in the creation or imposition of any Lien
upon or with respect to any material property or assets now owned or hereafter
acquired by any Credit Party.

 

8.3.         Enforceability.
This Agreement has been duly executed and delivered by each Credit Party party
hereto and constitutes, and each other Credit Document when executed and
delivered by each Credit Party that is party thereto will constitute, a legal,
valid and binding obligation of such Credit Party enforceable against each such
Credit Party in accordance with its terms, subject to Debtor Relief Laws and to
general principles of equity.

 

8.4.         Governmental
Approvals; Other Consents. No action, consent or approval of, registration
or filing with or any other action by, any Governmental Authority or any other
Person is or will be required in connection with the execution, delivery and
performance of the Credit Documents, except for (a) such as have been made or
obtained and are in full force and effect, (b) filings necessary to perfect the
Liens on the Collateral granted by the

 

90

 

Credit Parties in favor
of the Secured Parties and (c) those approvals, consents, exemptions,
authorizations or other actions, notices or filings, the failure of which to
obtain or make could not reasonably be expected to have a Material Adverse
Effect.

 

8.5.         Federal
Reserve Regulations. (a) No Credit Party nor any Restricted Subsidiary is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying Margin Stock.

 

(b)          No part of
the proceeds of any Loan or the issue of any Letter of Credit will be used,
whether directly or indirectly, and whether immediately, incidentally or
ultimately, for any purpose that entails a violation of Regulation U or
Regulation X.

 

8.6.         Investment
Company Act. No Credit Party nor any Restricted Subsidiary is an
“investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940, as amended.

 

8.7.         Use of
Proceeds. The proceeds of the Loans and the issuance of Letters of Credit
will be used for general corporate purposes not in contravention of any law or
any Credit Document, provided that any Loans made on the Closing Date shall be
used solely for working capital purposes.

 

8.8.         Solvency.
(a) (i) Immediately after giving effect to the Transactions, (A) the fair value
of the assets of Holdings and its Subsidiaries on a consolidated basis, at a
fair valuation, will exceed the debts and liabilities, direct, subordinated,
contingent or otherwise, of Holdings and its Subsidiaries on a consolidated
basis, respectively; (B) the present fair saleable value of the property of
Holdings and its Subsidiaries on a consolidated basis will be greater than the
amount that will be required to pay the probable liability of Holdings and its
Subsidiaries on a consolidated basis on their debts and other liabilities,
direct, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (C) Holdings and its Subsidiaries on a
consolidated basis will be able to pay their debts and liabilities, direct,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (D) Holdings and its Subsidiaries on a consolidated
basis will not have unreasonably small capital with which to conduct the
businesses in which they are engaged as such businesses are now conducted and
are proposed to be conducted following the Closing Date and (ii) after giving
effect to the Transactions, each Credit Party (A) has not ceased, and does not
expect that it will cease, making payments on its liabilities when due and (B)
can, and expects that it can, obtain credit in the ordinary course of business.

 

(b)          No Credit
Party intends to, and does not believe that it or any of the Restricted
Subsidiaries will, incur debts beyond its ability to pay such debts as they
mature, taking into account the timing and amounts of cash to be received by it
or any such Subsidiary and the timing and amounts of cash to be payable on or
in respect of its Indebtedness or the Indebtedness of any such Subsidiary.

 

8.9.         Financial
Statements; No Material Adverse Effect. (a) The audited financial
statements of the Company and the semiconductors business of the Seller as at

 

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December 31, 2005 and for
the fiscal year then ended together with the notes thereto (i) were prepared in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein; and (ii) fairly present,
in all material respects, the combined financial condition of the Company and
the semiconductors business of the Seller as of the date thereof and their
results of operations for the period covered thereby in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein.

 

(b)          The
unaudited consolidated balance sheets of the Company and the semiconductors
business of the Seller as at June 30, 2006 and for the period then ended, and
the related consolidated statements of income or operations, shareholders’
equity and cash flows together with the notes thereto (i) were prepared in
accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein, and (ii) fairly present,
in all material respects, the combined financial condition of the Company and
the semiconductors business of the Seller as of the date thereof and their
results of operations for the period covered thereby, subject, in the case of sub-clauses
(i) and (ii), to the absence of footnotes and to normal year-end audit
adjustments.

 

(c)          Since the
date of the audited financial statements described in clause (a) above, there
has been no event or circumstance, either individually or in the aggregate,
that has had or could reasonably be expected to have a Material Adverse Effect.

 

8.10.       Litigation.
Except as specifically disclosed on Schedule 8.10, there are no actions, suits,
proceedings, claims or disputes pending or, to the knowledge of the Borrowers,
threatened in writing, at law, in equity, in arbitration or before any
governmental authority, by or against Holdings or any of its Subsidiaries or
against any of their properties or revenues that either individually or in the
aggregate, have had or could reasonably be expected to have a Material Adverse
Effect.

 

8.11.       No
Default. Neither Holdings nor any Subsidiary thereof is in default under
any contractual obligation that could, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

 

8.12.       Ownership
of Properties; Liens. Holdings and each Subsidiary thereof has good record
and marketable title in fee simple to, or valid leasehold interests in, all
real property necessary in the ordinary conduct of its business, except for
such defects in title as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The property of
Holdings and its Subsidiaries is subject to no Liens, other than Permitted
Liens and Permitted Collateral Liens.

 

8.13.       Environmental
Compliance. Holdings and its Subsidiaries conduct in the ordinary course of
business a review of the effect of existing Environmental Laws and claims
alleging potential liability or responsibility for violation of any
Environmental Law on their respective businesses, operations and properties,
and as a result thereof to the best knowledge of Holdings, except as
specifically disclosed in Schedule 8.13, such Environmental Laws and

 

92

 

claims could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

8.14.       Taxes.
Except as could not, either individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect, Holdings and its Subsidiaries
have filed all federal, state and other material tax returns and reports
required to be filed, and have paid all federal, state and other material
taxes, assessments, fees and other governmental charges levied or imposed upon
them or their properties, income or assets otherwise due and payable, except
those (a) which are not overdue by more than 30 days or (b) which are being
contested in good faith by appropriate proceedings diligently conducted and for
which adequate reserves have been provided in accordance with GAAP.

 

8.15.       Subsidiaries;
Equity Interests. As of the Closing Date, Holdings has no Subsidiaries
other than those specifically disclosed in Schedule 8.15, and (except as
disclosed on such Schedule) all of the outstanding equity interests in such
Subsidiaries have been validly issued, are fully paid and nonassessable and are
owned by Holdings or a Subsidiary thereof in the amounts specified in Schedule
8.15 free and clear of all Liens other than (a) those created under the
Security Documents and (b) any Permitted Lien. As of the Closing Date, neither
Holdings nor any of its Subsidiaries has any equity investments in any other
corporation or entity other than those specifically disclosed in Schedule 8.15.

 

8.16.       No
Material Misstatements. All written information (other than projections)
(the “Information”) furnished by or on behalf of any Credit Party to any
Lenders or the Administrative Agent in connection with the Transactions (as
such Information may have been supplemented in writing prior to the Closing Date)
or the other transactions contemplated by the Credit Documents, when taken as a
whole, was true and correct in all material respects, as of the date such
Information was furnished to the Lenders or the Administrative Agent (as the
case may be) and (in the case of such Information delivered prior to the
Closing Date) as of the Closing Date and did not contain any material
misstatement of fact as of any such date or omit to state a material fact
necessary in order to make the statements contained therein not materially
misleading in light of the circumstances under which such statements were made;
provided that, with respect to projected financial information and pro
forma financial information, the Credit Parties represent only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time of preparation; it being understood that such
projections may vary from actual results and that such variances may be
material.

 

8.17.       Compliance
With Laws. Holdings, the Company and each of its Restricted Subsidiaries is
in compliance in all material respects with the requirements of all laws and
all orders, writs, injunctions and decrees applicable to it or to its
properties, except in such instances in which (a) such requirement of law or
order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted or (b) the failure to comply
therewith, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect. Without limitation of the
foregoing, Holdings, the Company and each of its Restricted Subsidiaries is in
compliance (i) with all applicable provisions of law and all applicable
regulations and published interpretations thereunder with respect to any
employee pension benefit plan or other social security and employee benefit
plan governed by

 

93

 

the laws in any
jurisdiction in which it operates and (ii) with the terms of any such plan,
except, in each case, for (x) such requirement of law, applicable regulation,
published interpretations or plan term is being contested in good faith by
appropriate proceeding diligently conducted; or (y) such noncompliance that
could not reasonably be expected to have a Material Adverse Effect.

 

8.18.       Intellectual
Property Licenses. Holdings, the Company and its Restricted Subsidiaries
own, license or possess the right to use, all of the trademarks, service marks,
trade names, copyrights, patents, patent rights, franchises, licenses and other
intellectual property rights (collectively, “IP Rights”) that are
reasonably necessary for the operation of their respective businesses as
currently conducted, without conflict with the rights of any other person,
except to the extent such conflicts, either individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect. To the best
knowledge of Holdings, no slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now contemplated to
be employed, by Holdings or any Subsidiary infringes upon any rights held by
any other person, except to the extent such infringements, either individually
or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect. Except as specifically disclosed in Schedule 8.18, no claim or
litigation regarding any of the foregoing is pending or, to the knowledge of
Holdings, threatened in writing, which, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

 

SECTION 9.         Affirmative
Covenants

 

Each Borrower
hereby covenants and agrees that on the Closing Date and thereafter, until the
Commitments and each Letter of Credit have terminated and the Loans and Unpaid
Drawings, together with interest, Fees and all other Secured Obligations
incurred hereunder, are paid and performed in full:

 

9.1.         Financial
Statements. The Company will deliver to the Administrative Agent for prompt
further distribution to each Lender:

 

(a)          as soon as
available, but in any event on or before the date on which such financial
statements would be required to be filed with the SEC but no later than 120
days after the end of the fiscal year (or, if such financial statements are not
required to be filed with the SEC, within 120 days after the end of each fiscal
year of the Company) a consolidated balance sheet of the Company and its
Subsidiaries as at the end of such fiscal year, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for
such fiscal year, setting forth in each case in comparative form the figures
for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, audited and accompanied by a report and opinion of KPMG,
Ernst & Young or another registered public accounting firm of
internationally recognized standing reasonably acceptable to the Administrative
Agent, which report and opinion shall be prepared in accordance with generally
accepted auditing standards and shall not be subject to any “going concern” or
like qualification or exception or any qualification or exception as to the
scope of such audit;

 

(b)          as soon as
available, but in any event on or before the date on which such financial
statements would be required to be filed with the SEC (or, if such financial
statements

 

94

 

are not required to be
filed with the SEC, within 60 days (or 90 days in the case of the fiscal
quarter ending September 30, 2006) after the end of each of the first three
fiscal quarters of each fiscal year of the Company) beginning with the fiscal
quarter ending September 30, 2006 a consolidated balance sheet of the Company
and its Subsidiaries as at the end of such fiscal quarter, and the related
consolidated statements of income or operations, shareholders’ equity and cash
flows for such fiscal quarter and for the portion of the Company’s fiscal year
then ended, setting forth in each case in comparative form the figures for the
corresponding fiscal quarter of the previous fiscal year and the corresponding
portion of the previous fiscal year (provided that information for prior year
interim periods ending prior to the Closing Date may be based on management
reports), all in reasonable detail and, other than in the case of the financial
statements included in the quarterly report for the fiscal quarter ended
September 30, 2006, certified by the chief executive officer, chief financial
officer, treasurer or controller of the Company as fairly presenting in all
material respects the financial condition, results of operations, shareholders’
equity and cash flows of the Company and its Subsidiaries in accordance with
GAAP, subject only to normal year-end audit adjustments and the absence of
footnotes. The financial statements included in the quarterly report for the
fiscal quarter ended September 30, 2006 shall be prepared on the same basis as
the unaudited financial statements for the six months ended June 30, 2006
included in the offering memorandum relating to the Senior Notes Offering with
such pro forma adjustments thereto as management believes appropriate in
relation to the allocation of costs and expenses, and shall include a statement
of cash flows prepared on a consistent basis with the income statement and
balance sheet;

 

(c)          as soon as
available, but in any event within, in the case of the fiscal year of the
Company commencing on January 1, 2007, 120 days after the commencement of such
fiscal year and, thereafter, 90 days after the commencement of each fiscal year
of the Company, forecasts prepared by management of the Company, in reasonable
detail as customarily prepared by management of the Company for their internal
use, of consolidated balance sheets and statements of income or operations and
cash flows of the Company and its Subsidiaries for such fiscal year (including
the fiscal year in which the maturity date occurs).

 

At any time that
any of the Company’s Subsidiaries are Unrestricted Subsidiaries and any such
Unrestricted Subsidiary or group of Unrestricted Subsidiaries, if taken together
as one Subsidiary, constitutes a Significant Subsidiary of the Company, then
the annual and quarterly financial information required by the clauses (a) and
(b) above shall include either (i) a reasonably detailed presentation, either
on the face of the financial statements or in the footnotes thereto, of the
financial condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of operations of
the Unrestricted Subsidiaries of the Company or (ii) stand-alone audited or
unaudited financial statements, as the case may be, of such Unrestricted
Subsidiary or Unrestricted Subsidiaries (as a group or otherwise) together with
an unaudited reconciliation to the financial information of the Company and its
Subsidiaries, which reconciliation shall include the following items: revenue,
EBITDA, net income, cash, total assets, total debt, shareholders equity,
capital expenditures and interest expense.

 

Notwithstanding
the foregoing, the obligations in clauses (a) and (b) above may be satisfied
with respect to financial information of the Company and its Subsidiaries by

 

95

 

furnishing (i) the
applicable financial statements of Holdings (or any direct or indirect parent
of Holdings) or (ii) the Company’s or Holdings’ (or any direct or indirect
parent thereof), as applicable, Form 20-F or 6-K, as applicable, filed with the
SEC; provided that, with respect to each of sub-clauses (i) and (ii),
(A) to the extent such information relates to Holdings (or a parent thereof),
such information is accompanied by consolidating information that explains in
reasonable detail the differences between the information relating to Holdings
(or such parent), on the one hand, and the information relating to the Company
and its Subsidiaries on a standalone basis, on the other hand and (B) to the
extent such information is in lieu of information required to be provided under
this Section 9.1, such materials are accompanied by a report and opinion of an
independent registered public accounting firm of internationally recognized
standing, which report and opinion shall be prepared in accordance with
generally accepted auditing standards and shall not be subject to any “going
concern” or like qualification or exception or any qualification or exception
as to the scope of such audit.

 

9.2.         Certificates;
Other Information. The
Company will deliver to the Administrative Agent for prompt further
distribution to each Lender:

 

(a)          not
later than 5 Business Days after the delivery of the financial statements
referred to in Section 9.1(a), a certificate of the registered public
accounting firm certifying such financial statements; and

 

(b)          not
later than 5 Business Days after the delivery of the financial statements
referred to in Section 9.1(a) and 9.1(b), a duly completed Compliance
Certificate signed by the chief executive officer, chief financial officer,
treasurer or controller of the Company.

 

Documents required to be delivered pursuant to Section 9.1(a) or 9.1(b)
above may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (a) on which Holdings or the Company posts such
documents, or provides a link thereto on Holdings’ or the Company’s website on
the internet at the website address listed on Schedule 9.2; or (b) on which
such documents are posted on Holdings’ or the Company’s behalf on an internet
or intranet website, if any, to which each Lender and the Administrative Agent
have access (whether a commercial, third-party website or whether sponsored by
the Administrative Agent); provided that: (i) upon written request by the
Administrative Agent, Holdings or the Company shall deliver paper copies of
such documents to the Administrative Agent for further distribution to each
Lender that requests Holdings or the Company to deliver such paper copies until
a written request to cease delivering paper copies is given by the
Administrative Agent or such Lender and (ii) Holdings or the Company shall
notify the Administrative Agent for further notification to each Lender (by
telecopier or electronic mail) of the posting of any such documents and provide
to the Administrative Agent by electronic mail electronic versions (i.e., soft
copies) of such documents. Notwithstanding anything contained herein, in every
instance Company shall be required to provide paper copies of the Compliance
Certificates to the Administrative Agent. Each Lender shall be solely
responsible for timely accessing posted documents or requesting delivery of
paper copies of such documents from the Administrative Agent and maintaining
its copies of such documents.

 

96

 

9.3.         Notices. (a) Each Borrower will, or will cause the
relevant Subsidiary (other than Jilin and SSMC or any other Unrestricted
Subsidiary) to, promptly after a Responsible Officer of the Company or such
Subsidiary obtains knowledge thereof, notify the Administrative Agent:

 

(i)           of
the occurrence of any Default; and

 

(ii)          of any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including (A) breach or non-performance
of, or any default under, a contractual obligation of Holdings or any
Subsidiary thereof; (B) any dispute, litigation, investigation, proceeding or
suspension between Holdings or any Subsidiary thereof and any Governmental
Authority; or (C) the commencement of, or any material development in, any
litigation or proceeding affecting Holdings or any Subsidiary thereof,
including pursuant to any applicable Environmental Laws, which, in any such
case, has resulted or could reasonably be expected to result in a Material
Adverse Effect.

 

(b)          Each
notice pursuant to this Section 9.3 shall be accompanied by a statement of a
Responsible Officer of the Company setting forth material details of the
occurrence referred to therein and stating what action the Company or the
relevant Subsidiary has taken and proposes to take with respect thereto.

 

9.4.         Payment
of Obligations. Each Borrower
will, and will cause each of its Restricted Subsidiaries to, pay and discharge
as the same shall become due and payable, all its obligations and liabilities
in respect of taxes, assessments and governmental charges or levies upon it or
its properties or assets, unless (a) the same are being contested in good faith
by appropriate proceedings diligently conducted and adequate reserves, if any,
in accordance with GAAP are being maintained by Holdings or such Restricted
Subsidiary; or (b) the failure to pay or discharge the same could not, either
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

 

9.5.         Preservation
of Existence; Assets. Each
Borrower will, and will cause each of its Restricted Subsidiaries to:

 

(a)          preserve,
renew and maintain in full force and effect its legal existence and good
standing under the laws of the jurisdiction of its organization, except to the
extent the failure to do so could not, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect;

 

(b)          take
all reasonable action to maintain all rights, privileges, permits, licenses and
franchises necessary or desirable in the normal conduct of its business, except
(i) to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect or (ii) pursuant to a transaction permitted by
Section 10.9 or 10.10; and

 

(c)          preserve
or renew all of its registered patents, trademarks, trade names and service
marks, the non preservation of which could reasonably be expected to have a
Material Adverse Effect.

 

97

 

9.6.         Maintenance
of Properties. Each Borrower
will, and will cause each of its Restricted Subsidiaries to, maintain, preserve
and protect all of its material properties and equipment necessary in the
operation of its business in good working order and condition, ordinary wear
and tear excepted and casualty and condemnation excepted, and make all
necessary repairs thereto and renewals and replacements thereof (in accordance
with prudent industry practice) except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect.

 

9.7.         Maintenance
of Insurance. Each Borrower
will, and will cause each of its Restricted Subsidiaries to, maintain with
financially sound and reputable insurance companies, insurance with respect to
its properties and business against loss or damage of the kinds customarily
insured against by persons engaged in the same or similar business, of such
types and in such amounts (after giving effect to any self-insurance reasonable
and customary for similarly situated persons engaged in the same or similar
businesses as the Company and its Restricted Subsidiaries) as are customarily
carried under similar circumstances by such other persons.

 

9.8.         Compliance
with Laws. Each Borrower
will, and will cause each of its Restricted Subsidiaries to, comply in all
material respects with the requirements of all laws and all orders, writs,
injunctions and decrees applicable to it or to its business or property, except
in such instances in which (a) such requirement of law or order, writ,
injunction or decree is being contested in good faith by appropriate
proceedings diligently conducted; or (b) the failure to comply therewith could
not reasonably be expected to have a Material Adverse Effect. Without
limitation of the foregoing, Holdings and each of its Restricted Subsidiaries
shall at all times comply (i) with all applicable provisions of law and all
applicable regulations and published interpretations thereunder with respect to
any employee pension benefit plan or other social security and employee benefit
plan governed by the laws in any jurisdiction in which it operates and (ii)
with the terms of any such plan (including funding obligations thereunder),
except, in each case, for (x) such requirement of law, applicable regulation,
published interpretations or plan term is being contested in good faith by
appropriate proceeding diligently conducted; or (y) such noncompliance that
could not reasonably be expected to have a Material Adverse Effect.

 

9.9.         Inspection
Rights. Each Borrower will,
and will cause each of its Restricted Subsidiaries to, permit representatives
and independent contractors of the Administrative Agent and the Required
Lenders to visit and inspect any of its properties, to examine its corporate,
financial and operating records, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants, at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to Holdings; provided,
however, that, excluding any such visits and inspections during the
continuation of an Event of Default, only the Administrative Agent on behalf of
the Lenders may exercise rights of the Administrative Agent and the Required
Lenders under this Section 9.9 and the Administrative Agent shall not exercise
such rights more often than two times during any calendar year absent the
existence of an Event of Default and for one such time the reasonable expenses
of the Administrative Agent in connection with such visit and inspection shall
be for the Company’s account; provided further that when an
Event Of Default exists the Administrative Agent or any Lender (or any of their
respective representatives or independent

 

98

 

contractors) may do any
of the foregoing at the reasonable expense of the Company at any time during
normal business hours and upon reasonable advance notice.

 

9.10.       Use
of Proceeds. Each Borrower will use the proceeds of the extensions of
credit under this Agreement for general corporate purposes not in contravention
of any law or any Credit Document.

 

9.11.       Guarantees
by Holdings and Restricted Subsidiaries. (a) Subject to the Agreed Security
Principles, all existing Wholly Owned Subsidiaries (other than an Immaterial
Subsidiary and the Co-Borrower) will fully and unconditionally guarantee this
Agreement. If the Company or any of its Restricted Subsidiaries acquires or
creates a Wholly Owned Subsidiary (other than an Immaterial Subsidiary) after
the Closing Date and the issuance of a Guarantee by such Guarantor is not
precluded by the Agreed Security Principles, the new Restricted Subsidiary
must, within 30 days (or such longer period as the Administrative Agent may
agree in writing) after becoming a Restricted Subsidiary, provide a Guarantee
of this Agreement by executing a supplement to the Guaranty in the form
attached thereto.

 

(b)          The
obligations of each Guarantor under the Guaranty will be limited to the maximum
amount that would not render the Guarantors obligations subject to avoidance
under applicable fraudulent conveyance provisions of the United States
Bankruptcy Code or any comparable provision of foreign or state law.

 

(c)          The
obligations of a Guarantor under the Guaranty will terminate upon:

 

(i)           a
sale or other disposition (including by way of consolidation or merger) of the
Guarantor or the sale or disposition of all or substantially all the assets of
the Guarantor (other than to the Company or a Restricted Subsidiary), in each
case, as permitted by this Agreement;

 

(ii)          the
designation in accordance with this Agreement of the Guarantor as an
Unrestricted Subsidiary;

 

(iii)         to the extent that the Guarantor is not an
Immaterial Subsidiary due to the operation of clause (a) of the definition of
“Immaterial Subsidiary”, upon the release of the guarantee referred to in such
clause; or

 

(iv)         repayment
in full of all amounts due and payable under the Credit Documents and
cancellation of Commitments hereunder.

 

9.12.       Additional
Liens and Security Interests. (a) Subject to the Agreed Security
Principles, within 60 days (or such longer period as the Administrative Agent
may agree in writing) after (i) any Restricted Subsidiary becomes a Guarantor
in accordance with Section 9.11 or (ii) any Credit Party acquires any material
property that is not automatically subject to a perfected security interest
under the Security Documents, the relevant Credit Party shall, in each case at
its sole cost and expense, duly execute and deliver to the Administrative Agent
such mortgages, security agreement supplements and other security documents, as
reasonably

 

99

 

specified by and in form
and substance reasonably satisfactory to the Administrative Agent (in form and
scope, and covering such collateral on such terms, in each case consistent with
the mortgages, security agreements and other security documents in effect on
the Closing Date), granting a security interest in favor of the Secured
Parties, and take such additional actions (including the giving of notices, the
filing of statements and the provision of all instruments and documents
reasonably requested by the Administrative Agent) to perfect and protect the
security interests of the Secured Parties under the Security Documents.
Notwithstanding the foregoing, no Credit Party shall be required to provide a
security interest pursuant to this Section 9.12 (x) except as provided in
Section 9.16, in cash or bank accounts prior to the occurrence of an
Enforcement Event, (y) if the Agreed Security Principles would not so require
or (z) over assets or properties that are not subject to Liens under the
Security Documents specifically set forth on Schedule 1.1(e) (whether or not
such Security Documents shall have been executed on the Closing Date) as a
result of the application of the Agreed Security Principles. Any security
interest provided pursuant to this Section 9.12 shall be accompanied with such
opinions of counsel to the Company as customarily given by borrower’s counsel
in the relevant jurisdiction, in form and substance customary for such jurisdiction.
The Company will use reasonable endeavors to procure that its counsel in any
relevant jurisdiction provides a legal opinion in respect of any such security
interest.

 

(b)          The
obligations of a Credit Party under the Security Documents to which it is a
party will terminate upon:

 

(i)           such
Credit Party ceasing to be a Guarantor in accordance with Section 9.1l(c);

 

(ii)          except
in the case of Holdings, the designation in accordance with this Agreement of
such Credit Party as an Unrestricted Subsidiary; or

 

(iii)         payment and performance in full of the Secured
Obligations and the cancellation of Commitments hereunder.

 

(c)          The assets
or property of a Credit Party forming part of the Collateral shall be released
from the Lien created under any Security Document to which such Credit Party is
a party upon the sale or disposition of such assets or property (other than to
the Company or a Restricted Subsidiary) in a transaction permitted by this
Agreement (other than a sale or disposition subject to Section 10.9 or
10.10(c)).

 

9.13.       Further
Assurances. Subject to the Agreed Security Principles, promptly upon
request by the Administrative Agent, (a) correct any material defect or error
that may be discovered in any Credit Document or in the execution, acknowledgment,
filing or recordation thereof, and (b) do, execute, acknowledge, deliver,
record, re-record, file, re-file, register and re-register any and all such
further acts, deeds, certificates, assurances and other instruments as the
Administrative Agent, may reasonably require from time to time in order to
carry out more effectively the purposes of any Credit Document.

 

100

 

9.14.       Insurance
Endorsements. Within 10 Business Days (or 30 days in the case of the
Guarantor organized under the laws of Thailand) after the Closing Date and the
end of each calendar year, the Lenders shall have received endorsements naming
the relevant Collateral Agent, on behalf of the Lenders, as an additional
insured or loss payee, as the case may be, under all material insurance policies
to be renewed following the Closing Date or entered into prior to the end of
such fiscal year with respect to the properties of Holdings and its
Subsidiaries forming part of the Collateral.

 

9.15.       Equal
and Ratable Security. In the event that assets of the Guarantor organized
under the laws of the Philippines or the Capital Stock in such Guarantor are
provided as security (other than through sharing the benefit of any conditional
assignment granted by such a Guarantor on the Closing Date) for Indebtedness
referred to in Section 10. l(b)(i), 10.1(b)(iv), 10.1(b)(xi) or 10.1(b)(xiii)
in excess of an aggregate of €25,000,000, then the Company shall, or shall
cause the relevant Restricted Subsidiary to, provide that the obligations of
the Borrowers under the Credit Documents are secured equally and ratably with
all the Indebtedness that causes that threshold to be exceeded, for so long as
such Indebtedness is so secured.

 

9.16.       Security
Over Cash and Bank Accounts. (a) On or before the Closing Date the Company
shall establish bank accounts held, in each case, with the Global Collateral
Agent in London and denominated in US Dollars, Euros and Sterling (each an “Initial
Secured Account” and together the “Initial Secured Accounts”) and
shall, on the Closing Date, deposit a nominal amount into each Initial Secured
Account.

 

(a)       Upon the occurrence and
during the continuance of an Enforcement Event the Company shall, and shall
procure that each of its Restricted Subsidiaries shall (i) pay the proceeds of
the sale or collection of Collateral to a bank account or bank accounts that do
not contain other cash of the Company or the relevant Restricted Subsidiary (as
the case may be) that is not the proceeds of Collateral, (ii) not commingle the
proceeds of Collateral with other cash of the Company or the relevant
Restricted Subsidiary and (iii) pay the proceeds of Collateral denominated in
US Dollars, Sterling and Euros that are paid to, or received by, the Company or
a Restricted Subsidiary promptly to the relevant Initial Secured Account and,
to the extent practicable, direct counterparties to pay the proceeds of
Collateral directly to the relevant Initial Secured Account.

 

(b)       Upon the occurrence and
during the continuance of an Enforcement Event, the Company shall, and shall
procure that each of its Restricted Subsidiaries shall, grant, subject to the
Agreed Security Principles, a perfected Lien in all bank accounts held by the
Company or any Restricted Subsidiary to which proceeds of Collateral are paid,
to the extent of the proceeds of such Collateral (any such account, an “Additional
Secured Account”, and together with the Initial Secured Accounts, the “Secured
Accounts”); provided that, to the extent any of the Additional
Secured Accounts are or become part of the bank accounts used in the cash
management system of the Company, the Company and its Restricted Subsidiaries
shall each be entitled to grant a Lien over the Additional Secured Accounts in
favor of the bank providing cash management facilities to secure the Company’s
obligations to such bank, which Lien shall rank equally and ratably with the
Lien created in favor of the Global Collateral Agent.

 

101

 

SECTION 10.       Negative
Covenants

 

Holdings and each
Borrower hereby covenants and agrees that on the Closing Date and thereafter,
until the Commitments and each Letter of Credit have terminated and the Loans
and Unpaid Drawings, together with interest, Fees and all other Secured
Obligations incurred hereunder, are paid and performed in full:

 

10.1.       Limitation
on Indebtedness. (a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, Incur any Indebtedness (including Acquired
Indebtedness); provided, however, that after the expiry of the
Bridge Period the Company and any of the Guarantors may Incur Indebtedness if
on the date of such Incurrence and after giving pro  forma effect
thereto (including pro  forma application of the proceeds
thereof), the Fixed Charge Coverage Ratio for the Company and its Restricted
Subsidiaries is greater than 2.00 to 1.0.

 

(b)          Clause
(a) will not prohibit the Incurrence of the following Indebtedness:

 

(i)           Indebtedness
Incurred pursuant to any Credit Facility (including in respect of letters of
credit or bankers’ acceptances issued or created thereunder), and any
Refinancing Indebtedness in respect thereof and Guarantees in respect of such
Indebtedness in a maximum aggregate principal amount at any time outstanding
not exceeding (A) €750,000,000, plus (B) in the case of any refinancing of any
Indebtedness permitted under this sub-clause (i) or any portion thereof, the
aggregate amount of fees, underwriting discounts, premiums and other costs and
expenses Incurred in connection with such refinancing;

 

(ii)      (A) (1)
Guarantees by the Company or any Restricted Subsidiary of Indebtedness of the
Company or any Guarantor and (2) co-issuance by the Co-Borrower of any
Indebtedness of the Company, in each case so long as the Incurrence of such
Indebtedness is permitted under this Agreement; or

 

(B)       without
limiting Section 10.3, Indebtedness arising by reason of any Lien granted by or
applicable to such Person securing Indebtedness of the Company or any
Restricted Subsidiary so long as the Incurrence of such Indebtedness is
permitted under this Agreement;

 

(iii)         Indebtedness of the Company owing to and held
by any Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing
to and held by the Company or any Restricted Subsidiary; provided, however,
that:

 

(A)      any
subsequent issuance or transfer of Capital Stock or any other event which
results in any such Indebtedness being beneficially held by a Person other than
the Company or a Restricted Subsidiary of the Company; and

 

(B)       any
sale or other transfer of any such Indebtedness to a Person other than the
Company or a Restricted Subsidiary of the Company,

 

102

 

shall be deemed, in each
case, to constitute an Incurrence of such Indebtedness by the Company or such
Restricted Subsidiary, as the case may be;

 

(iv)         Indebtedness
represented by (A) the Bridge Loans issued on the Closing Date and exchange
notes issued in respect thereof or the Senior Notes issued on or after the
Closing Date, (B) any Indebtedness (other than Indebtedness described in
sub-clauses (i) and (iii) above) outstanding on the Closing Date, (C) Refinancing
Indebtedness Incurred in respect of any Indebtedness described in this
sub-clause (iv) or sub-clauses (v), (vii), or (xi) below or Incurred pursuant
to clause (a) above, (D) Management Advances and (E) obligations arising under
a declaration of joint and several liability in respect of a Restricted
Subsidiary used for the purpose of section 2:403 of the Dutch Civil Code (Burgerlijk Wetboek) (and any residual
liability under such declaration arising pursuant to section 2:404(2) of the
Dutch Civil Code) to the extent that such obligations constitute Indebtedness;

 

(v)          Indebtedness
of any Person Incurred and outstanding on the date on which such Person becomes
a Restricted Subsidiary of the Company or another Restricted Subsidiary of the
Company or is merged, consolidated, amalgamated or otherwise combined with
(including pursuant to any acquisition of assets and assumption of related
liabilities) the Company or any Restricted Subsidiary (other than Indebtedness
Incurred (A) to provide all or any portion of the funds utilized to consummate
the transaction or series of related transactions pursuant to which such Person
became a Restricted Subsidiary or was otherwise acquired by the Company or a
Restricted Subsidiary or (B) otherwise in connection with or contemplation of
such acquisition); provided, however, with respect to this
sub-clause (v), that at the time of such acquisition or other transaction (x)
the Company would have been able to Incur €1.00 of additional Indebtedness
pursuant to clause (a) above after giving effect to the Incurrence of such
Indebtedness pursuant to this sub-clause (v), or (y) the Fixed Charge Coverage
Ratio would not be lower than it was immediately prior to giving effect to such
acquisition or other transaction;

 

(vi)         Indebtedness
under Currency Agreements, Interest Rate Agreements and Commodity Hedging
Agreements entered into for bona fide hedging purposes of the Company or its
Restricted Subsidiaries and not for speculative purposes (as determined in good
faith by the Board of Directors or senior management of the Company);

 

(vii)        Indebtedness represented by Capitalized Lease
Obligations or Purchase Money Obligations, and in each case any Refinancing
Indebtedness in respect thereof, in an aggregate outstanding principal amount
which, when taken together with the principal amount of all other Indebtedness
Incurred pursuant to this sub-clause (vii) and then outstanding, will not
exceed at any time outstanding the greater of (A) €100,000,000 and (B) 1% of
Total Assets;

 

(viii)       Indebtedness in respect of (A) workers’
compensation claims, self-insurance obligations, performance, indemnity,
surety, judgment, appeal, advance payment, customs, VAT or other tax or other
guarantees or other similar bonds,

 

103

 

instruments or
obligations and completion guarantees and warranties provided by the Company or
a Restricted Subsidiary or relating to liabilities, obligations or guarantees
Incurred in the ordinary course of business, (B) letters of credit, bankers’
acceptances, guarantees or other similar instruments or obligations issued or
relating to liabilities or obligations Incurred in the ordinary course of
business, (C) the financing of insurance premiums in the ordinary course of
business and (D) any customary cash management, cash pooling or netting or
setting off arrangements in the ordinary course of business;

 

(ix)         Indebtedness
arising from agreements providing for customary guarantees, indemnification,
obligations in respect of earnouts or other adjustments of purchase price or,
in each case, similar obligations, in each case, Incurred or assumed in
connection with the acquisition or disposition of any business or assets or
Person or any Capital Stock of a Subsidiary (other than Guarantees of
Indebtedness Incurred by any Person acquiring or disposing of such business or
assets or such Subsidiary for the purpose of financing such acquisition or
disposition); provided that the maximum liability of the Company and its
Restricted Subsidiaries in respect of all such Indebtedness shall at no time
exceed the gross proceeds, including the fair market value of non-cash proceeds
(measured at the time received and without giving effect to any subsequent
changes in value), actually received by the Company and its Restricted
Subsidiaries in connection with such disposition;

 

(x)        (A) Indebtedness arising
from the honoring by a bank or other financial institution of a check, draft or
similar instrument drawn against insufficient funds in the ordinary course of
business; provided, however, that such Indebtedness is
extinguished within five Business Days of Incurrence;

 

(B)       Customer
deposits and advance payments received in the ordinary course of business from
customers for goods purchased in the ordinary course of business;

 

(C)       Indebtedness
owed on a short-term basis of no longer than 30 days to banks and other
financial institutions incurred in the ordinary course of business of the
Company and its Restricted Subsidiaries with such banks or financial
institutions that arises in connection with ordinary banking arrangements to
manage cash balances of the Company and its Restricted Subsidiaries; and

 

(D)      Indebtedness
incurred by a Restricted Subsidiary in connection with bankers acceptances,
discounted bills of exchange or the discounting or factoring of receivables for
credit management purposes, in each case incurred or undertaken in the ordinary
course of business on arm’s length commercial terms on a recourse basis;

 

(xi)         Indebtedness
in an aggregate outstanding principal amount which, when taken together with
any Refinancing Indebtedness in respect thereof and the principal amount of all
other Indebtedness Incurred pursuant to this sub-clause (xi) and then
outstanding, will not exceed €450,000,000;

 

104

 

(xii)                 Indebtedness in
an aggregate outstanding principal amount which, when taken together with any
Refinancing Indebtedness in respect thereof and the principal amount of all
other Indebtedness Incurred pursuant to this sub-clause (xii) and then
outstanding, will not exceed 100% of the Net Cash Proceeds received by the
Company from the issuance or sale (other than to a Restricted Subsidiary) of
its Capital Stock (other than Disqualified Stock, Designated Preference Shares
or an Excluded Contribution) or otherwise contributed to the equity (other than
through the issuance of Disqualified Stock, Designated Preference Shares or an
Excluded Contribution) of the Company, in each case, subsequent to the Closing
Date; provided, however, that (A) any such Net Cash Proceeds that
are so received or contributed shall be excluded for purposes of making
Restricted Payments under clause (a) above and Sections 10.2(c)(i), (vi), and
(x) to the extent the Company and its Restricted Subsidiaries incur
Indebtedness in reliance thereon, and (B) any Net Cash Proceeds that are so
received or contributed shall be excluded for purposes of Incurring
Indebtedness pursuant to this sub-clause (xii) to the extent the Company or any
of its Restricted Subsidiaries makes a Restricted Payment under Section 10.2
and Sections 10.2(c)(i), (vi), and (x) in reliance thereon;

 

(xiii)              Indebtedness of
Non-Guarantor Restricted Subsidiaries incurred as a result of (A) any
governmental or regulatory restrictions, limitations or penalties in the nature
of capital controls, exchange controls or similar restrictions affecting the
incurrence or repayment of intercompany Indebtedness by any Restricted
Subsidiary or (B) any ordinary course country risk management policies of the
Company restricting or limiting transfers or distributions from the Company or any
Restricted Subsidiary to the Company or any Restricted Subsidiary, provided
that the principal amount of such Indebtedness so incurred when aggregated with
other Indebtedness previously incurred in reliance on this sub-clause (xiii)
and still outstanding shall not in the aggregate exceed €350,000,000; and

 

(xiv)             the guarantee by the
Company or a Restricted Subsidiary of Debt of any Person in which the Company
or a Restricted Subsidiary has beneficial ownership of 15% or more of the
Voting Stock in respect of performance, bid or surety bonds issued by or on
behalf of any such Person in the ordinary course of business in an aggregate
amount, together with all other guarantees of the Company outstanding pursuant
to this sub-clause (xiv) on the date of such incurrence, not to exceed
€15,000,000.

 

(c)                      For purposes
of determining compliance with, and the outstanding principal amount of any
particular Indebtedness Incurred pursuant to and in compliance with, this
Section 10.1:

 

(i)                         in the
event that Indebtedness meets the criteria of more than one of the types of
Indebtedness described in clauses (a) and (b) above, the Company, in its sole
discretion, will classify, and may from time to time reclassify, such item of
Indebtedness and only be required to include the amount and type of such
Indebtedness in one of the sub-clauses of clause (b) or clause (a);

 

(ii)                      all
Indebtedness outstanding on the Closing Date under this Agreement shall be
deemed initially Incurred on the Closing Date under clause (b)(i) above and not

 

105

 

clause (a) or
clause (b)(v)(B) above, and may not be reclassified pursuant to sub-clause (i)
above;

 

(iii)                   Guarantees of,
or obligations in respect of letters of credit, bankers’ acceptances or other
similar instruments relating to, or Liens securing, Indebtedness that is
otherwise included in the determination of a particular amount of Indebtedness
shall not be included;

 

(iv)                  if obligations
in respect of letters of credit, bankers’ acceptances or other similar
instruments are Incurred pursuant to any Credit Facility and are being treated
as Incurred pursuant to clause (b)(i), (vii), (xi), (xii) or (xiii) or clause
(a) above and the letters of credit, bankers’ acceptances or other similar
instruments relate to other Indebtedness, then such other Indebtedness shall
not be included;

 

(v)                     the principal
amount of any Disqualified Stock of the Company or a Restricted Subsidiary, or
Preferred Stock of a Restricted Subsidiary, will be equal to the greater of the
maximum mandatory redemption or repurchase price (not including, in either
case, any redemption or repurchase premium) or the liquidation preference
thereof;

 

(vi)                  Indebtedness
permitted by this covenant need not be permitted solely by reference to one
provision permitting such Indebtedness but may be permitted in part by one such
provision and in part by one or more other provisions of this covenant
permitting such Indebtedness; and

 

(vii)               the amount of
Indebtedness issued at a price that is less than the principal amount thereof
will be equal to the amount of the liability in respect thereof determined on
the basis of GAAP.

 

(d)                     Accrual of
interest, accrual of dividends, the accretion of accreted value, the accretion
or amortization of original issue discount, the payment of interest in the form
of additional Indebtedness, the payment of dividends in the form of additional
shares of Preferred Stock or Disqualified Stock or the reclassification of
commitments or obligations not treated as Indebtedness due to a change in GAAP,
will not be deemed to be an Incurrence of Indebtedness for purposes of this
Section 10.1.

 

(e)                      The amount
of any Indebtedness outstanding as of any date shall be (i) the accreted value
thereof in the case of any Indebtedness issued with original issue discount and
(ii) the principal amount, or liquidation preference thereof, in the case of
any other Indebtedness.

 

(f)                        If at any
time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any
Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted
Subsidiary of the Company as of such date (and, if such Indebtedness is not
permitted to be Incurred as of such date under this Section 10.1 the Company
shall be in Default of this covenant).

 

(g)                     For purposes
of determining compliance with any euro-denominated restriction on the
Incurrence of Indebtedness, the Base Currency Equivalent of the principal

 

106

 

amount of Indebtedness
denominated in another currency shall be calculated based on the relevant
currency exchange rate in effect on the date such Indebtedness was Incurred, in
the case of term Indebtedness, or, at the option of the Company, first
committed, in the case of Indebtedness Incurred under a revolving credit
facility; provided that (i) if such Indebtedness is Incurred to
refinance other Indebtedness denominated in a currency other than euros, and
such refinancing would cause the applicable euro-denominated restriction to be
exceeded if calculated at the relevant currency exchange rate in effect on the
date of such refinancing, such euro-denominated restriction shall be deemed not
to have been exceeded so long as the principal amount of such Refinancing
Indebtedness does not exceed the principal amount of such Indebtedness being
refinanced; (ii) the Base Currency Equivalent of the principal amount of any
such Indebtedness outstanding on the Closing Date shall be calculated based on
the relevant currency exchange rate in effect on the Closing Date; and (iii) if
and for so long as any such Indebtedness is subject to a Currency Agreement
with respect to the currency in which such Indebtedness is denominated covering
principal and interest on such Indebtedness, the amount of such Indebtedness,
if denominated in euros, will be the amount of the principal payment required
to be made under such Currency Agreement and, otherwise, the Base Currency
Equivalent of such amount plus the Base Currency Equivalent of any premium
which is at such time due and payable but is not covered by such Currency
Agreement.

 

(h)                     Notwithstanding
any other provision of this covenant, the maximum amount of Indebtedness that
the Company or a Restricted Subsidiary may Incur pursuant to this Section 10.1
shall not be deemed to be exceeded solely as a result of fluctuations in the
exchange rate of currencies. The principal amount of any Indebtedness Incurred
to refinance other Indebtedness, if Incurred in a different currency from the
Indebtedness being refinanced, shall be calculated based on the currency
exchange rate applicable to the currencies in which such Refinancing
Indebtedness is denominated that is in effect on the date of such refinancing.

 

(i)                         If the
Company adopts the US Dollars as its reporting currency, it may elect
irrevocably to convert all Euro-denominated restrictions into US
Dollar-denominated restrictions at the applicable Exchange Rate prevailing on
the date of such election, and all references in this Agreement to determining
Base Currency Equivalents and Base Currency amounts shall apply mutatis
mutandis as though referring to US Dollars.

 

10.2.            Limitation on
Restricted Payments. (a) The Company will not, and will not permit any of
its Restricted Subsidiaries, directly or indirectly, to:

 

(i)                         declare
or pay any dividend or make any distribution on or in respect of the Company’s
or any Restricted Subsidiary’s Capital Stock (including any payment in
connection with any merger or consolidation involving the Company or any of its
Restricted Subsidiaries) except:

 

(A)                  dividends or
distributions payable in Capital Stock of the Company (other than Disqualified
Stock) or in options, warrants or other rights to purchase such Capital Stock
of the Company or in Subordinated Shareholder Funding; and

 

107

 

(B)                    dividends or
distributions payable to the Company or a Restricted Subsidiary (and, in the
case of any such Restricted Subsidiary making such dividend or distribution, to
holders of its Capital Stock other than the Company or another Restricted
Subsidiary on no more than a pro rata basis, measured by value);

 

(ii)                      purchase,
redeem, retire or otherwise acquire for value any Capital Stock of the Company
or any direct or indirect Parent of the Company held by Persons other than the
Company or a Restricted Subsidiary of the Company (other than in exchange for
Capital Stock of the Company (other than Disqualified Stock));

 

(iii)                   purchase,
repurchase, redeem, defease or otherwise acquire or retire for value, prior to
scheduled maturity, scheduled repayment or scheduled sinking fund payment, any
Subordinated Indebtedness (other than (A) any such purchase, repurchase,
redemption, defeasance or other acquisition or retirement or in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity,
in each case, due within one year of the date of purchase, repurchase,
redemption, defeasance or other acquisition or retirement and (B) any
Indebtedness Incurred pursuant to Section 10.1(b)(iii)) or any Subordinated
Shareholder Funding; or

 

(iv)                  make any
Restricted Investment in any Person;

 

(any such dividend,
distribution, purchase, redemption, repurchase, defeasance, other acquisition,
retirement or Restricted Investment referred to in sub-clauses (i) through (iv)
above are referred to herein as a “Restricted Payment”), in the case of
any payment described in sub-clauses (i), (ii) or (iii) at any time during the
Bridge Period. If such payment is a Restricted Investment or, in the case of
any such payment after the expiry of the Bridge Period, such payment may be
made unless, at the time the Company or such Restricted Subsidiary makes such
Restricted Payment:

 

(A)                  a Default shall
have occurred and be continuing (or would result immediately thereafter
therefrom);

 

(B)                    the Fixed
Charge Coverage Ratio would not exceed 2.00 to 1.00 after giving effect, on a pro forma
basis, to such Restricted Payment; or

 

(C)                    the aggregate
amount of such Restricted Payment and all other Restricted Payments made
subsequent to the Closing Date (and not returned or rescinded) (including
Permitted Payments permitted below by clauses (c)(vi), (x), (xi), and (xii),
but excluding all other Restricted Payments permitted by clause (c)) would
exceed the sum of (without duplication):

 

(1)                       50% of
Consolidated Net Income for the period (treated as one accounting period) from
the first day of the first fiscal quarter commencing after the Closing Date to
the end of the most recent fiscal quarter ending prior to the date of such
Restricted Payment for which

 

108

 

internal consolidated
financial statements of the Company are available (or, in the case such
Consolidated Net Income is a deficit, minus 100% of such deficit);

 

(2)                       100% of the
aggregate Net Cash Proceeds, and the fair market value (as determined in
accordance with clause (b) below) of property or assets or marketable
securities, received by the Company from the issue or sale of its Capital Stock
(other than Disqualified Stock or Designated Preference Shares) or Subordinated
Shareholder Funding subsequent to the Closing Date or otherwise contributed to
the equity (other than through the issuance of Disqualified Stock or Designated
Preference Shares) of the Company subsequent to the Closing Date (other than
(x) Net Cash Proceeds or property or assets or marketable securities received
from an issuance or sale of such Capital Stock to a Restricted Subsidiary or an
employee stock ownership plan or trust established by the Company or any
Subsidiary of the Company for the benefit of its employees to the extent funded
by the Company or any Restricted Subsidiary, (y) Net Cash Proceeds or property
or assets or marketable securities to the extent that any Restricted Payment
has been made from such proceeds in reliance on clause (c)(vi) below, and (z)
Excluded Contributions);

 

(3)                       100% of the
aggregate Net Cash Proceeds, and the fair market value (as determined in
accordance with clause (b) below) of property or assets or marketable
securities, received by the Company or any Restricted Subsidiary from the
issuance or sale (other than to the Company or a Restricted Subsidiary of the
Company or an employee stock ownership plan or trust established by the Company
or any Subsidiary of the Company for the benefit of its employees to the extent
funded by the Company or any Restricted Subsidiary) by the Company or any
Restricted Subsidiary subsequent to the Closing Date of any Indebtedness that
has been converted into or exchanged for Capital Stock of the Company (other
than Disqualified Stock or Designated Preference Shares) or Subordinated
Shareholder Funding (plus the amount of any cash, and the fair market value (as
determined in accordance with clause (b) below) of property or assets or
marketable securities, received by the Company or any Restricted Subsidiary
upon such conversion or exchange);

 

(4)                       the amount
equal to the net reduction in Restricted Investments made by the Company or any
of its Restricted Subsidiaries resulting from:

 

(a)                    repurchases,
redemptions or other acquisitions or retirements of any such Restricted
Investment, proceeds realized upon the sale or other disposition to a Person
other than the Company or a Restricted

 

109

 

Subsidiary of any such Restricted
Investment, repayments of loans or advances or other transfers of assets
(including by way of dividend, distribution, interest payments or returns of
capital) to the Company or any Restricted Subsidiary; or

 

(b)                   the
redesignation of Unrestricted Subsidiaries as Restricted Subsidiaries (valued,
in each case, as provided in the definition of “Investment”) not to exceed, in
the case of any Unrestricted Subsidiary, the amount of Investments previously
made by the Company or any Restricted Subsidiary in such Unrestricted
Subsidiary, which amount, in each case under this sub-paragraph (4), was
included in the calculation of the amount of Restricted Payments; provided,
however, that no amount will be included in Consolidated Net Income for
purposes of sub-paragraph (1) above to the extent that it is (at the Company’s
option) included under this sub-paragraph (4); and

 

(5)                       the amount
of the cash and fair market value (as determined in accordance with the next
succeeding paragraph) of property or assets or of marketable securities
received by the Company or any of its Restricted Subsidiaries in connection
with:

 

(a)                       the sale or
other disposition (other than to the Company or a Restricted Subsidiary or an
employee stock ownership plan or trust established by the Company or any
Subsidiary of the Company for the benefit of its employees to the extent funded
by the Company or any Restricted Subsidiary) of Capital Stock of an
Unrestricted Subsidiary of the Company; and

 

(b)                      any dividend
or distribution made by an Unrestricted Subsidiary or Affiliate to the Company
or a Restricted Subsidiary;

 

provided,
however, that no amount will be included in Consolidated Net Income for
purposes of sub-paragraph (1) above to the extent that it is (at the Company’s
option) included under this sub-paragraph (5) above; provided further,
however, that such amount shall not exceed the amount included in the
calculation of the amount of Restricted Payments.

 

(b)                     The fair
market value of property or assets other than cash covered by clause (a) above
shall be the fair market value thereof as determined in good faith by the Board
of Directors of the Company or the relevant Restricted Subsidiary.

 

110

 

(c)                      Clause (a)
above will not prohibit any of the following (collectively, “Permitted Payments”):

 

(i)                         any
purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Capital Stock, Disqualified Stock, Designated Preference Shares,
Subordinated Shareholder Funding or Subordinated Indebtedness made by exchange
(including any such exchange pursuant to the exercise of a conversion right or
privilege in connection with which cash is paid in lieu of the issuance of
fractional shares) for, or out of the proceeds of the substantially concurrent
sale of, Capital Stock of the Company (other than Disqualified Stock or
Designated Preference Shares), Subordinated Shareholder Funding or a
substantially concurrent contribution to the equity (other than through the
issuance of Disqualified Stock or Designated Preference Shares or through an
Excluded Contribution) of the Company; provided, however, that to
the extent so applied, the Net Cash Proceeds, or fair market value (as
determined in accordance with the preceding sentence) of property or assets or
of marketable securities, from such sale of Capital Stock, Subordinated
Shareholder Funding or such contribution will be excluded from clause
(a)(iv)(C)(2) above;

 

(ii)                      any purchase, repurchase, redemption, defeasance or other acquisition or
retirement of Subordinated Indebtedness made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Refinancing Indebtedness
permitted to be Incurred pursuant to Section 10.1;

 

(iii)                   any purchase, repurchase, redemption, defeasance or other acquisition or
retirement of Preferred Stock of the Company or a Restricted Subsidiary made by
exchange for or out of the proceeds of the substantially concurrent sale of
Preferred Stock of the Company or a Restricted Subsidiary, as the case may be,
that, in each case, is permitted to be Incurred pursuant to Section 10.1, and
that in each case, constitutes Refinancing Indebtedness;

 

(iv)                  any purchase,
repurchase, redemption, defeasance or other acquisition or retirement of Subordinated Indebtedness:

 

(A)                  (1) from Net Available Cash to the extent
permitted under Section 10.5, but only if the Company shall have first complied
with Section 10.5 and purchased all Loans tendered pursuant to any offer to
repurchase all the Loans required thereby, prior to purchasing, repurchasing,
redeeming, defeasing or otherwise acquiring or retiring such Subordinated
Indebtedness and (2) at a purchase price not greater than 100% of the principal
amount of such Subordinated Indebtedness plus accrued and unpaid interest;

 

(B)                    to the extent required by the agreement governing
such Subordinated Indebtedness, following the occurrence of a Change of Control
(or other similar event described therein as a “change of control”), but only
(1) if the Company shall have first paid in full all amounts due under this
Agreement as a result of such Change of Control and purchased all Loans
tendered pursuant to the

 

111

 

offer to repurchase all
the Loans required thereby, prior to purchasing, repurchasing, redeeming,
defeasing or otherwise acquiring or retiring such Subordinated Indebtedness and
(2) at a purchase price not greater than 101% of the principal amount of such
Subordinated Indebtedness plus accrued and unpaid interest; or

 

(C)                    (1) consisting of Acquired Indebtedness (other
than Indebtedness Incurred (x) to provide all or any portion of the funds
utilized to consummate the transaction or series of related transactions
pursuant to which such Person became a Restricted Subsidiary or was otherwise
acquired by the Company or a Restricted Subsidiary or (y) otherwise in
connection with or contemplation of such acquisition) and (2) at a purchase
price not greater than 100% of the principal amount of such Subordinated
Indebtedness plus accrued and unpaid interest and any premium required by the
terms of any Acquired Indebtedness;

 

(v)                     any dividends paid within 60 days after the
date of declaration if at such date of declaration such dividend would have
complied with this provision;

 

(vi)                  the
purchase, repurchase, redemption, defeasance or other acquisition, cancellation
or retirement for value of Capital Stock of any Parent (including any options,
warrants or other rights in respect thereof) and loans, advances, dividends or
distributions by the Company to any Parent to permit any Parent to purchase,
repurchase, redeem, defease or otherwise acquire, cancel or retire for value
Capital Stock of any Parent (including any options, warrants or other rights in
respect thereof), or payments to purchase, repurchase, redeem, defease or
otherwise acquire, cancel or retire for value Capital Stock of the any Parent
(including any options, warrants or other rights in respect thereof), in each
case from Management Investors: provided that such payments, loans,
advances, dividends or distributions do not exceed an amount (net of repayments
of any such loans or advances) equal to (A) €40,000,000 plus (B) €20,000,000
multiplied by the number of calendar years that have commenced since the
Closing Date plus (C) the Net Cash Proceeds received by the Company or its
Restricted Subsidiaries since the Closing Date (including through receipt of
proceeds from the issuance or sale of its Capital Stock or Subordinated
Shareholder Funding to a Parent) from, or as a contribution to the equity (in
each case under this clause (C), other than through the issuance of Disqualified
Stock or Designated Preference Shares) of the Company from, the issuance or
sale to Management Investors of Capital Stock (including any options, warrants
or other rights in respect thereof), to the extent such Net Cash Proceeds are
not included in any calculation under clause (a)(iv)(C)(2) above;

 

(vii)               the
declaration and payment of dividends to holders of any class or series of
Disqualified Stock, or of any Preferred Stock of a Restricted Subsidiary,
Incurred in accordance with Section 10.1;

 

(viii)            purchases,
repurchases, redemptions, defeasances or other acquisitions or retirements of
Capital Stock deemed to occur upon the exercise of stock options, warrants

 

112

 

or other rights in
respect thereof if such Capital Stock represents a portion of the exercise
price thereof;

 

(ix)                    dividends, loans, advances or distributions to any Parent or other
payments by the Company or any Restricted Subsidiary in amounts equal to
(without duplication):

 

(A)                  the amounts required for any Parent to pay any
Parent Expenses or any Related Taxes; or

 

(B)                    amounts constituting or to be used for
purposes of making payments (1) in connection with, and of fees and expenses
Incurred in connection with, the Transactions or (2) to the extent specified in
Sections 10.6(c)(ii), (iii), (v), (vii) and (xii).

 

(x)                       so long as no Default or Event of Default has
occurred and is continuing (or would result from), the declaration and payment
by the Company of, or loans, advances, dividends or distributions to any Parent
to pay, dividends on the common stock or common equity interests of the Company
or any Parent following a Public Offering of such common stock or common equity
interests, in an amount not to exceed in any fiscal year the greater of (A) 6%
of the Net Cash Proceeds received by the Company from such Public Offering or
contributed to the equity (other than through the issuance of Disqualified
Stock or Designated Preference Shares or through an Excluded Contribution) of
the Company and (B) following the Initial Public Offering, an amount equal to
the greater of (1) the greater of (x) 7% of the Market Capitalization and (y)
7% of the IPO Market Capitalization; provided that after giving pro
forma effect to such loans, advances, dividends or distributions, the
Consolidated Leverage Ratio shall be equal to or less than 2.75 to 1.00 and (2)
the greater of (x) 5% of the Market Capitalization and (y) 5% of the IPO Market
Capitalization; provided that after giving pro  forma
effect to such loans, advances, dividends or distributions, the Consolidated
Leverage Ratio shall be equal to or less than 3.25 to 1.00;

 

(xi)                    so long as no Default or Event of Default has occurred and is continuing
(or would result from), Restricted Payments (including loans or advances) in an
aggregate amount outstanding at any time not to exceed €200,000,000; provided
that during the Bridge Period, such amounts may only be applied to make
Restricted Investments;

 

(xii)                 payments
by the Company, or loans, advances, dividends or distributions to any Parent to
make payments, to holders of Capital Stock of the Company or any Parent in lieu
of the issuance of fractional shares of such Capital Stock, provided, however,
that any such payment, loan, advance, dividend or distribution shall not be for
the purpose of evading any limitation of this covenant or otherwise to
facilitate any dividend or other return of capital to the holders of such
Capital Stock (as determined in good faith by the Board of Directors);

 

113

 

(xiii)              Investments in an
aggregate amount outstanding at any time not to exceed the aggregate cash
amount of Excluded Contributions, or
consisting of non-cash Excluded Contributions, or Investments to the extent
made in exchange for or using as consideration Investments previously made
under this sub-clause (xiii);

 

(xiv)             [Reserved];

 

(xv)                [Reserved];

 

(xvi)             (A)
the declaration and payment of dividends to holders of any class or series of
Designated Preference Shares of the Company issued after the Closing Date; and
(B) the declaration and payment of dividends to any Parent or any Affiliate
thereof, the proceeds of which will be used to fund the payment of dividends to
holders of any class or series of Designated Preference Shares of such Parent
issued after the Closing Date; provided, however, that, in the
case of paragraphs (A) and (B), the amount of all dividends declared or paid
pursuant to sub-clause (xvi) shall not exceed the Net Cash Proceeds received by
the Company or the aggregate amount contributed in cash to the equity (other
than through the issuance of Disqualified Stock or an Excluded Contribution or,
in the case of Designated Preference Shares by Parent or an Affiliate the
issuance of Designated Preference Shares) of the Company, from the issuance or
sale of such Designated Preference Shares;

 

(xvii)          [Reserved];

 

(xviii)       dividends
or other distributions of Capital Stock of Unrestricted Subsidiaries (unless
the Unrestricted Subsidiary’s principal asset is cash and Cash Equivalents or
to the extent the assets owned by such Unrestricted Subsidiary were contributed
in contemplation to such dividend or distribution); and

 

(xix)               [Reserved].

 

(d)                     The amount of all Restricted Payments (other
than cash) shall be the fair market value on the date of such Restricted
Payment of the asset(s) or securities proposed to be paid, transferred or
issued by the Company or such Restricted Subsidiary, as the case may be,
pursuant to such Restricted Payment. The fair market value of any cash
Restricted Payment shall be its face amount, and the fair market value of any
non-cash Restricted Payment shall be determined conclusively by the Board of
Directors of the Company acting in good faith.

 

10.3.            Limitation on Liens. The Company will not, and will not permit
any Restricted Subsidiary to, directly or indirectly, create, Incur or suffer
to exist any Lien (other than Permitted Liens or, in the case of assets
constituting Collateral, Permitted Collateral Liens) upon any of its property
or assets (including Capital Stock of a Restricted Subsidiary of the Company),
whether owned on the Closing Date or acquired after that date, or any interest
therein or any income or profits therefrom, which Lien secures any
Indebtedness.

 

114

 

10.4.            Limitation on Restrictions on Distributions
from Restricted Subsidiaries.
(a) The Company will not, and will not permit any Restricted Subsidiary to,
create or otherwise cause or permit to exist or become effective any consensual
encumbrance or consensual restriction on the ability of any Restricted
Subsidiary to:

 

(i)                         pay dividends or make any other distributions
in cash or otherwise on its Capital Stock or pay any Indebtedness or other
obligations owed to the Company or any Restricted Subsidiary;

 

(ii)                      make any loans or advances to the Company or
any Restricted Subsidiary; or

 

(iii)                   sell, lease or transfer any of its property or
assets to the Company or any Restricted Subsidiary;

 

provided that (x) the priority of any Preferred Stock
in receiving dividends or liquidating distributions prior to dividends or
liquidating distributions being paid on common stock and (y) the subordination
of (including the application of any standstill requirements to) loans or
advances made to the Company or any Restricted Subsidiary to other Indebtedness
Incurred by the Company or any Restricted Subsidiary shall not be deemed to
constitute such an encumbrance or restriction.

 

(b)                     Clause (a) above will not prohibit:

 

(i)                         any encumbrance or restriction pursuant to (A)
any Credit Facility (including the Credit Documents and the Bridge Facilities)
or (B) any other agreement or instrument, in each case, in effect at or entered
into on the Closing Date;

 

(ii)                      any encumbrance or restriction pursuant to an agreement or instrument of
a Person or relating to any Capital Stock or Indebtedness of a Person, entered
into on or before the date on which such Person was acquired by or merged,
consolidated or otherwise combined with or into the Company or any Restricted
Subsidiary, or was designated as a Restricted Subsidiary or on which such
agreement or instrument is assumed by the Company or any Restricted Subsidiary
in connection with an acquisition of assets (other than Capital Stock or
Indebtedness Incurred as consideration in, or to provide all or any portion of
the funds utilized to consummate, the transaction or series of related transactions
pursuant to which such Person became a Restricted Subsidiary or was acquired by
the Company or was merged, consolidated or otherwise combined with or into the
Company or any Restricted Subsidiary entered into or in connection with such
transaction) and outstanding on such date; provided that, for the
purposes of this sub-clause (ii), if another Person is the Successor Company,
any Subsidiary thereof or agreement or instrument of such Person or any such
Subsidiary shall be deemed acquired or assumed by the Company or any Restricted
Subsidiary when such Person becomes the Successor Company;

 

115

 

(iii)                   any encumbrance or restriction pursuant to an agreement or instrument
effecting a refinancing of Indebtedness Incurred pursuant to, or that otherwise
refinances, an agreement or instrument referred to in sub-clause (i) or (ii)
above or this sub-clause (iii) (an “Initial Agreement”) or contained in any
amendment, supplement or other modification to an agreement referred to in
sub-clause (i) or (ii) above or this sub-clause (iii); provided, however,
that the encumbrances and restrictions with respect to such Restricted
Subsidiary contained in any such agreement or instrument are no less favorable
in any material respect to the Lenders taken as a whole than the encumbrances
and restrictions contained in the Initial Agreement or Initial Agreements to
which such refinancing or amendment, supplement or other modification relates
(as determined in good faith by the Company);

 

(iv)                  any
encumbrance or restriction:

 

(A)                  that restricts in a customary manner the
subletting, assignment or transfer of any property or asset that is subject to
a lease, license or similar contract, or the assignment or transfer of any
lease, license or other contract;

 

(B)                    contained in mortgages, pledges or other
security agreements permitted under this Agreement or securing Indebtedness of
the Company or a Restricted Subsidiary permitted under this Agreement to the
extent such encumbrances or restrictions restrict the transfer of the property
or assets subject to such mortgages, pledges or other security agreements; or

 

(C)                    pursuant to customary provisions restricting
dispositions of real property interests set forth in any reciprocal easement
agreements of the Company or any Restricted Subsidiary;

 

(v)                     any encumbrance or restriction pursuant to
Purchase Money Obligations and Capitalized Lease Obligations permitted under
this Agreement, in each case, that impose encumbrances or restrictions on the
property so acquired or any encumbrance or restriction pursuant to a joint
venture agreement that imposes restrictions on the transfer of the assets of
the joint venture;

 

(vi)                  any
encumbrance or restriction with respect to a Restricted Subsidiary (or any of
its property or assets) imposed pursuant to an agreement entered into for the
direct or indirect sale or disposition to a Person of all or substantially all
the Capital Stock or assets of such Restricted Subsidiary (or the property or
assets that are subject to such restriction) pending the closing of such sale
or disposition;

 

(vii)               customary
provisions in leases, licenses, joint venture agreements and other similar
agreements and instruments entered into in the ordinary course of business;

 

(viii)            encumbrances
or restrictions arising or existing by reason of applicable law or any
applicable rule, regulation or order, or required by any regulatory authority;

 

116

 

(ix)                    any
encumbrance or restriction on cash or other deposits or net worth imposed by
customers under agreements entered into in the ordinary course of business;

 

(x)                       any
encumbrance or restriction pursuant to Currency Agreements, Interest Rate
Agreements or Commodity Hedging Agreements;

 

(xi)                    any
encumbrance or restriction arising pursuant to an agreement or instrument
relating to any Indebtedness permitted to be Incurred subsequent to the Closing
Date pursuant to Section 10.1 if the encumbrances and restrictions contained in
any such agreement or instrument taken as a whole are not materially less
favorable to the Lenders than (A) the encumbrances and restrictions contained
in this Agreement, together with the Security Documents associated therewith as
in effect on the Closing Date or (B) in comparable financings (as determined in
good faith by the Company) and where, in the case of paragraph (B), the Company
determines at the time of issuance of such Indebtedness that such encumbrances
or restrictions will not adversely affect, in any material respect, the
Borrowers’ ability to make principal or interest payments on the Loans or
Unpaid Drawings;

 

(xii)                 [Reserved]; or

 

(xiii)              any encumbrance or
restriction existing by reason of any Lien permitted under Section 10.3.

 

10.5.         Limitation on Sales of
Assets and Subsidiary Stock. (a) The Company will not, and will not permit
any of its Restricted Subsidiaries to, make any Asset Disposition unless:

 

(i)                         the
Company or such Restricted Subsidiary, as the case may be, receives
consideration (including by way of relief from, or by any other Person assuming
responsibility for, any liabilities, contingent or otherwise) at least equal to
the fair market value (such fair market value to be determined on the date of
contractually agreeing to such Asset Disposition), as determined in good faith
by the Board of Directors of the Company, of the shares and assets subject to
such Asset Disposition (including, for the avoidance of doubt, if such Asset
Disposition is a Permitted Asset Swap);

 

(ii)                      in any such
Asset Disposition, or series of related Asset Dispositions (except to the
extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the
consideration from such Asset Disposition (excluding any consideration by way
of relief from, or by any other Person assuming responsibility for, any
liabilities, contingent or otherwise, other than Indebtedness) received by the
Company or such Restricted Subsidiary, as the case may be, is in the form of
cash, Cash Equivalents or Temporary Cash Investments; and

 

(iii)                   an amount equal
to 100% of the Net Available Cash from such Asset Disposition is applied by the
Company or such Restricted Subsidiary, as the case may be:

 

117

 

(A)                  to the extent
the Company or any Restricted Subsidiary, as the case may be, elects (or is
required by the terms of any Indebtedness of a Restricted Subsidiary), (1) to
prepay, repay or purchase any Indebtedness of a non-Guarantor Restricted
Subsidiary (in each case, other than Indebtedness owed to the Company or any
Restricted Subsidiary) or Indebtedness under this Agreement within 365 days
from the later of (x) the date of such Asset Disposition and (y) the receipt of
such Net Available Cash; provided, however, that such prepayment
shall only be required after the Company and the Co-Borrower have complied with
Section 10.5(b)(ii) and in connection with any prepayment, repayment or
purchase of Indebtedness pursuant to this paragraph (A), the Company or such
Restricted Subsidiary will retire such Indebtedness and will cause the related
commitment (if any) (except in the case of this Agreement) to be permanently
reduced in an amount equal to the principal amount so prepaid, repaid or
purchased; or (2) to prepay, repay or purchase Pari Passu Indebtedness at a
price of no more than 100% of the principal amount of such Pari Passu
Indebtedness plus accrued and unpaid interest to the date of such prepayment,
repayment or purchase; provided that the Company shall redeem, repay or
repurchase Pari Passu Indebtedness pursuant to this sub-paragraph (2) only if
the Company makes (at such time or subsequently in compliance with this Section
10.5) an offer to Lenders to purchase Loans in accordance with the provisions
set forth below for an Asset Disposition Offer for an aggregate principal
amount of Loans at least equal to the proportion that (x) the total aggregate
principal amount of Loans outstanding bears to (y) the sum of the total
aggregate principal amount of Loans outstanding plus the total aggregate
principal amount outstanding of such Pari Passu Indebtedness; or

 

(B)                    to the extent
the Company or such Restricted Subsidiary elects, to invest in or commit to
invest in Additional Assets (including by means of an investment in Additional
Assets by a Restricted Subsidiary with Net Available Cash received by the
Company or another Restricted Subsidiary) within 365 days from the later of (1)
the date of such Asset Disposition and (2) the receipt of such Net Available
Cash; provided, however, that any such reinvestment in Additional
Assets made pursuant to a definitive binding agreement or a commitment approved
by the Board of Directors of the Company that is executed or approved within
such time will satisfy this requirement, so long as such investment is
consummated within 180 days of such 365th day; provided that to the
extent that any disposition in such Asset Sale was of Collateral, the assets
(including Voting Stock) acquired with the Net Cash Proceeds thereof shall,
subject to the Agreed Security Principles, be pledged as Collateral under the
Security Documents substantially simultaneously with such acquisition; provided
further that neither the Company nor any Restricted Subsidiary shall be
entitled to rely on the Agreed Security Principles so as not to provide
security over the assets so acquired to the extent that it would result in more
than 60% of the fair market value of the assets so acquired (as determined on
the date of the acquisition thereof) not being subject to security interests
(perfected to the extent required by the Security

 

118

 

Documents specifically
set forth on Schedule 1.1 (e) or otherwise in accordance with the Agreed
Security Principles);

 

provided
that, pending the final application of any such Net Available Cash in
accordance with paragraph (A)(l) or paragraph (B) above, the Company and its
Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest
such Net Available Cash in any manner not prohibited by this Agreement.

 

(b)                     (i) Any Net
Available Cash from Asset Dispositions that is not applied or invested or
committed to be applied or invested as provided in clause (a) above will be
deemed to constitute “Excess Proceeds.” On the 366th day after an Asset
Disposition, if the aggregate amount of Excess Proceeds exceeds €50,000,000,
the Borrowers will, subject to sub-clause (ii) below, be required to make an
offer (“Asset Disposition Offer”‘) to all Lenders and, to the extent the
Company elects, to all holders of other outstanding Pari Passu Indebtedness, to
purchase the maximum principal amount of Loans and any such Pari Passu
Indebtedness to which the Asset Disposition Offer applies that may be purchased
out of the Excess Proceeds, at an offer price in respect of the Loans in an
amount equal to (and, in the case of any Pari Passu Indebtedness, an offer
price of no more than) 100% of the principal amount of the Loans and 100% of
the principal amount of Pari Passu Indebtedness, in each case, plus accrued and
unpaid interest, if any, to, but not including, the date of purchase, in
accordance with the procedures set forth herein or the agreements governing the
Pari Passu Indebtedness, as applicable.

 

(ii)                      The
Borrowers shall only be required to make an Asset Disposition Offer to Lenders
and apply any Excess Proceeds to purchase Loans after the Company and the
Co-Borrower have (A) during the Bridge Period, complied with any mandatory
prepayment obligations under each of the Bridge Facilities and (B) after the
Bridge Period has expired, at the election of the Company and the Co-Borrower,
prepaid, repaid or repurchased Indebtedness under the Note Indentures in
respect of the Senior Notes, and, in each case, then only to the extent of the
Excess Proceeds available after the Company and the Co-Borrower have complied
with such obligations or made such prepayment, repayment or repurchase (as the
case may be).

 

(c)                      To the
extent that the aggregate amount of Loans and Pari Passu Indebtedness so
validly tendered and not properly withdrawn pursuant to an Asset Disposition
Offer is less than the Excess Proceeds, the Company may use any remaining
Excess Proceeds for general corporate purposes, subject to the other provisions
of this Agreement. If the aggregate principal amount of the Loans surrendered
in any Asset Disposition Offer by Lenders and other Pari Passu Indebtedness
surrendered by holders or lenders, collectively, exceeds the amount of Excess
Proceeds, the Excess Proceeds shall be allocated among the Loans and Pari Passu
Indebtedness to be purchased on a pro rata basis on the basis of the aggregate
principal amount of tendered Loans and Pari Passu Indebtedness. For the
purposes of calculating the principal amount of any such Indebtedness not
denominated in the Base Currency, such Indebtedness shall be calculated by
converting any such principal amounts into their Base Currency Equivalent
determined as of a date selected by the Company that is within the Asset
Disposition Offer Period (as defined in clause (e) below). Upon completion of
any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at
zero.

 

119

 

(d)                     To the extent
that any portion of Net Available Cash payable in respect of the Loans is
denominated in a currency other than the currency in which the relevant Loans
are denominated, the amount thereof payable in respect of such Loans shall not
exceed the net amount of funds in the currency in which such Loans are
denominated that is actually received by the Company upon converting such
portion into such currency.

 

(e)                      The Asset
Disposition Offer will remain open for a period of not less than 20 Business
Days following its commencement (the “Asset Disposition Offer Period”).
No later than five Business Days after the termination of the Asset Disposition
Offer Period (the “Asset Disposition Purchase Date”), the Borrowers will
purchase the principal amount of Loans and, to the extent they elect, Pari
Passu Indebtedness required to be purchased pursuant to this covenant (the “Asset
Disposition Offer Amount”) or, if less than the Asset Disposition Offer
Amount has been so validly tendered, all Loans and Pari Passu Indebtedness
validly tendered in response to the Asset Disposition Offer.

 

(f)                        On or
before the Asset Disposition Purchase Date, the Borrowers will, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Asset Disposition Offer Amount of Loans and Pari Passu Indebtedness or portions
of Loans and Pari Passu Indebtedness so validly tendered and not properly
withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset
Disposition Offer Amount has been validly tendered and not properly withdrawn,
all Loans and Pari Passu Indebtedness so validly tendered and not properly
withdrawn. The Company will deliver to the Administrative Agent an Officer’s
Certificate stating that such Loans or portions thereof were accepted for
payment by the Company in accordance with the terms of this Section 10.5. The
relevant Borrowers will promptly (but in any case not later than five Business
Days after termination of the Asset Disposition Offer Period) pay to the
Administrative Agent for the account of each tendering Lender an amount equal
to the purchase price of the Loans so validly tendered and not properly
withdrawn by such Lender, and accepted by the Borrowers for purchase.

 

(g)                     For the
purposes of clause (a)(ii) above, the following will be deemed to be cash:

 

(i)                         after the
expiry of the Bridge Period, the assumption by the transferee of Indebtedness
of the Company or Indebtedness of a Restricted Subsidiary (other than
Subordinated Indebtedness of the Company or a Guarantor) and the release of the
Company or such Restricted Subsidiary from all liability on such Indebtedness
in connection with such Asset Disposition;

 

(ii)                      securities,
notes or other obligations received by the Company or any Restricted Subsidiary
of the Company from the transferee that are converted by the Company or such
Restricted Subsidiary into cash or Cash Equivalents within 180 days following
the closing of such Asset Disposition;

 

(iii)                   Indebtedness of
any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result
of such Asset Disposition, to the extent that the Company and each

 

120

 

other Restricted
Subsidiary are released from any Guarantee of payment of such Indebtedness in
connection with such Asset Disposition;

 

(iv)                  after the expiry
of the Bridge Period, consideration consisting of Indebtedness of the Company
(other than Subordinated Indebtedness) received after the Closing Date from
Persons who are not the Company or any Restricted Subsidiary; and

 

(v)                     any
Designated Non-Cash Consideration received by the Company or any Restricted
Subsidiary in such Asset Dispositions having an aggregate fair market value,
taken together with all other Designated Non-Cash Consideration received
pursuant to this covenant that is at that time outstanding, not to exceed the
greater of €100,000,000 and 1% of Total Assets (with the fair market value of
each item of Designated Non-Cash Consideration being measured at the time
received and without giving effect to subsequent changes in value).

 

10.6.            Limitation on
Affiliate Transactions.

 

(a)                      The Company
will not, and will not permit any of its Restricted Subsidiaries to, directly
or indirectly, enter into or conduct any transaction (including the purchase,
sale, lease or exchange of any property or the rendering of any service) with
any Affiliate of the Company (an “Affiliate Transaction” involving aggregate
value in excess of €20,000,000 unless:

 

(i)                         the terms
of such Affiliate Transaction taken as a whole are not materially less
favorable to the Company or such Restricted Subsidiary, as the case may be,
than those that could be obtained in a comparable transaction at the time of
such transaction or the execution of the agreement providing for such
transaction in arm’s-length dealings with a Person who is not such an
Affiliate; and

 

(ii)                      in the event
such Affiliate Transaction involves an aggregate value in excess of
€50,000,000, the terms of such transaction have been approved by a majority of
the members of the Board of Directors of the Company or the relevant Restricted
Subsidiary (as applicable).

 

(b)                     Any Affiliate
Transaction shall be deemed to have satisfied the requirements set forth in
clause (a)(ii) above if such Affiliate Transaction is approved by a majority of
the Disinterested Directors. If there are no Disinterested Directors, any
Affiliate Transaction shall be deemed to have satisfied the requirements set
forth in this Section 10.6 if the Company or any of its Restricted
Subsidiaries, as the case may be, delivers to the Administrative Agent a letter
from an Independent Financial Advisor stating that such transaction is fair to
the Company or such Restricted Subsidiary from a financial point of view or
stating that the terms are not materially less favorable to the Company or its
relevant Restricted Subsidiary than those that would have been obtained in a
comparable transaction by the Company or such Restricted Subsidiary with an
unrelated Person on an arm’s length basis.

 

121

 

(c)                      The
provisions of clause (b) above will not apply to:

 

(i)                         any
Restricted Payment permitted to be made pursuant to Section 10.2, any Permitted
Payments (other than pursuant to Section 10.2(c)(ix)(B)(2)) or any Permitted
Investment (other than Permitted Investments as defined in clauses (a)(ii),
(b), (k) and (o) of the definition thereof);

 

(ii)                      any issuance
or sale of Capital Stock, options, other equity-related interests or other
securities, or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, or entering into, or maintenance of,
any employment, consulting, collective bargaining or benefit plan, program,
agreement or arrangement, related trust or other similar agreement and other
compensation arrangements, options, warrants or other rights to purchase
Capital Stock of the Company, any Restricted Subsidiary or any Parent,
restricted stock plans, long-term incentive plans, stock appreciation rights
plans, participation plans or similar employee benefits or consultants’ plans
(including valuation, health, insurance, deferred compensation, severance,
retirement, savings or similar plans, programs or arrangements) or indemnities
provided on behalf of officers, employees, directors or consultants approved by
the Board of Directors of the Company, in each case in the ordinary course of
business;

 

(iii)                   any Management
Advances and any waiver or transaction with respect thereto;

 

(iv)                  any transaction
between or among the Company and any Restricted Subsidiary (or entity that
becomes a Restricted Subsidiary as a result of such transaction), or between or
among Restricted Subsidiaries;

 

(v)                     the payment
of reasonable fees and reimbursement of expenses to, and customary indemnities
(including under customary insurance policies) and employee benefit and pension
expenses provided on behalf of, directors, officers, consultants or employees
of the Company, any Restricted Subsidiary of the Company or any Parent (whether
directly or indirectly and including through any Person owned or controlled by
any of such directors, officers or employees);

 

(vi)                  the Transactions
and the entry into and performance of obligations of the Company or any of its
Restricted Subsidiaries under the terms of any transaction arising out of, and
any payments pursuant to or for purposes of funding, any agreement or
instrument in effect as of or on the Closing Date, as these agreements and
instruments may be amended, modified, supplemented, extended, renewed or
refinanced from time to time in accordance with the other terms of this Section
10.6 or to the extent not more disadvantageous to the Lenders in any material
respect and the entry into and performance of any registration rights or other
listing agreement in connection with any Public Offering;

 

122

 

(vii)               execution, delivery
and performance of any Tax Sharing Agreement or the formation and maintenance
of any consolidated group for tax, accounting or cash pooling or management
purposes in the ordinary course of business;

 

(viii)            transactions with
customers, clients, suppliers or purchasers or sellers of goods or services, in
each case in the ordinary course of business, which are fair to the Company or
the relevant Restricted Subsidiary in the reasonable determination of the Board
of Directors or the senior management of the Company or the relevant Restricted
Subsidiary, or are on terms no less favorable than those that could reasonably
have been obtained at such time from an unaffiliated party;

 

(ix)                    any
transaction in the ordinary course of business between or among the Company or
any Restricted Subsidiary and any Affiliate of the Company or an Associate or
similar entity that would constitute an Affiliate Transaction solely because
the Company or a Restricted Subsidiary or any Affiliate of the Company or a
Restricted Subsidiary or any Affiliate of any Permitted Holder owns an equity
interest in or otherwise controls such Affiliate, Associate or similar entity;

 

(x)                       (A)
issuances or sales of Capital Stock (other than Disqualified Stock or
Designated Preference Shares) of the Company or options, warrants or other
rights to acquire such Capital Stock or Subordinated Shareholder Funding; provided
that the interest rate and other financial terms of such Subordinated
Shareholder Funding are approved by a majority of the members of the Board of
Directors in their reasonable determination and (B) any amendment, waiver or
other transaction with respect to any Subordinated Shareholder Funding in
compliance with the other provisions of this Agreement;

 

(xi)                    without
duplication in respect of payments made pursuant to sub-clause (xii) below, (A)
payments by the Company or any Restricted Subsidiary to any Permitted Holder
(whether directly or indirectly, including through any Parent) of annual
customary management, consulting, monitoring or advisory fees and related
expenses customary for portfolio companies of the Initial Investors described
in clause (a) of the definition thereof and (B) customary payments by the
Company or any Restricted Subsidiary to any Permitted Holder (whether directly
or indirectly, including through any Parent) for financial advisory, financing,
underwriting or placement services or in respect of other investment banking
activities, including in connection with acquisitions or divestitures, which
payments in respect of this paragraph (B) are approved by a majority of the
Board of Directors in good faith; and

 

(xii)                 payment to any
Permitted Holder of all reasonable out of pocket expenses Incurred by such
Permitted Holder in connection with its direct or indirect investment in the
Company and its Subsidiaries.

 

123

 

10.7.            Limitation on
Business Activities of the Co-Borrower. The Co-Borrower may not hold any
material assets, become liable for any material obligations or engage in any
business activities; provided that it may be a co-obligor with respect
to the notes or any other Indebtedness issued by the Company or a Guarantor,
and may engage in any activities directly related thereto or necessary in
connection therewith. The Co-Borrower shall be a Wholly-Owned Subsidiary of the
Company at all times.

 

10.8.            Limitation on
Business Activities of Holdings. (a) Holdings may not hold any material
assets, become liable for any material obligations or engage in any material
business activities, except those related to its ownership of the Company; provided
that it may guarantee this Agreement, the Senior Notes, the Bridge Facilities
and any other Indebtedness issued by the Company or a Guarantor and may incur
any Indebtedness in an aggregate amount not to exceed €20,000,000 and
Subordinated Shareholder Funding, and may engage in any activities directly
related thereto or necessary in connection therewith.

 

(b)                     During the
Bridge Period, Holdings shall not, and shall ensure that any Parent that owns
directly or indirectly all or substantially all of the Voting Stock of the
Company shall not, incur any Indebtedness (other than Indebtedness under this
Agreement in an aggregate amount not to exceed €20,000,000) at any time other
than (i) Guarantees of Debt of the Company and (ii) Subordinated Shareholder
Funding to a Permitted Holder.

 

10.9.            Merger and
Consolidation by the Company, (a) The Company will not consolidate with or
merge with or into, or convey, transfer or lease all or substantially all its
assets to, any Person, unless:

 

(i)                         the
resulting, surviving or transferee Person (the “Successor Company”) will
be a Person organized and existing under the laws of any member state of the
European Union on January 1, 2004, or the United States of America, any State
of the United States or the District of Columbia, Canada or any province of
Canada, Norway or Switzerland and the Successor Company (if not the Company)
will expressly assume, by supplemental agreements, executed and delivered to
the Administrative Agent, in form reasonably satisfactory to the Administrative
Agent, all the obligations of the Company under the Credit Documents;

 

(ii)                      immediately
after giving effect to such transaction (and treating any Indebtedness that
becomes an obligation of the Successor Company or any Subsidiary of the
Successor Company as a result of such transaction as having been Incurred by
the Successor Company or such Subsidiary at the time of such transaction), no
Default or Event of Default shall have occurred and be continuing;

 

(iii)                   immediately
after giving effect, on a pro forma basis, to such
transaction, either (A) the Fixed Coverage Ratio of the Successor Company would
exceed 2.00 to 1.00 or (B) the Fixed Charge Coverage Ratio would not be lower
than it was immediately prior to giving effect to such transaction; and

 

124

 

(iv)                  the Company
shall have delivered to the Administrative Agent an Officer’s Certificate and
an Opinion of Counsel, each to the effect that such consolidation, merger or
transfer and such supplemental agreement (if any) comply with this Agreement
and an Opinion of Counsel to the effect that such supplemental agreement (if
any) has been duly authorized, executed and delivered and is a legal, valid and
binding agreement enforceable against the Successor Company (in each case, in
form and substance reasonably satisfactory to the Administrative Agent),
provided that in giving an Opinion of Counsel, counsel may rely on an Officer’s
Certificate as to any matters of fact, including as to satisfaction of
sub-clauses (ii) and (iii) above.

 

(b)                     Any
Indebtedness that becomes an obligation of the Company or any Restricted
Subsidiary (or that is deemed to be Incurred by any Restricted Subsidiary that
becomes a Restricted Subsidiary) as a result of any such transaction undertaken
in compliance with this covenant, and any Refinancing Indebtedness with respect
thereto, shall be deemed to have been Incurred in compliance with Section 10.1.

 

(c)                      For purposes
of this covenant, the sale, lease, conveyance, assignment, transfer, or other
disposition of all or substantially all of the properties and assets of one or
more Subsidiaries of the Company, which properties and assets, if held by the
Company instead of such Subsidiaries, would constitute all or substantially all
of the properties and assets of the Company on a consolidated basis, shall be
deemed to be the transfer of all or substantially all of the properties and
assets of the Company.

 

(d)                     The Successor
Company will succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Agreement and the other Credit Documents
but in the case of a lease of all or substantially all its assets, the
predecessor company will not be released from its obligations under this
Agreement or the other Credit Documents.

 

(e)                      Notwithstanding
clauses (a)(ii) and (a)(iii) above (which do not apply to transactions referred
to in this clause (e)) and, other than with respect to clause (c) above and
clause (a)(iv) above, (i) any Restricted Subsidiary of the Company may
consolidate or otherwise combine with, merge into or transfer all or part of
its properties and assets to the Company and (ii) any Restricted Subsidiary may
consolidate or otherwise combine with, merge into or transfer all or part of
its properties and assets to any other Restricted Subsidiary. Notwithstanding
clause (a)(ii) or (a)(iii) above (which does not apply to the transactions
referred to in this clause (e)), the Company may consolidate or otherwise
combine with or merge into an Affiliate incorporated or organized for the
purpose of changing the legal domicile of the Company, reincorporating the
Company in another jurisdiction, or changing the legal form of the Company.

 

(f)                        This
Section 10.9 (other than the requirements of clause (a)(ii) above) shall not
apply to the creation of a new subsidiary as a Restricted Subsidiary of the
Company.

 

10.10.      Merger and Consolidations
by the Co-Borrower and Guarantors, (a) The Co-Borrower may not consolidate
with, merge with or into any person or permit any person to merge with or into
the Co-Borrower unless:

 

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(i)                         concurrently
therewith, a Subsidiary of the Company that is a limited liability company or
corporation organized under the laws of the United States of America or any
state thereof or the District of Columbia (which may be the Co-Borrower or the
continuing person as a result of such transaction) expressly assumes all of the
obligations of the Co-Borrower under this Agreement and the other Credit
Documents; or

 

(ii)                      after giving
effect to the transaction, at least one obligor on the Senior Notes is a
limited liability company or corporation organized under the laws of the United
States of America or any state thereof or the District of Columbia.

 

(b)                     Upon the
consummation of any transaction effected in accordance with this Section 10.10,
the resulting, surviving or transferee Co-Borrower will succeed to, and be
substituted for, and may exercise every right and power of, the Co-Borrower
under each Credit Document with the same effect as if such successor Person had
been named as the Co-Borrower under such Credit Documents. Upon such
substitution, the Co-Borrower will be released from its obligations under each
Credit Document.

 

(c)                      No Guarantor
may (i) consolidate with or merge with or into any Person, or (ii) sell,
convey, transfer or dispose of, all or substantially all its assets as an
entirety or substantially as an entirety, in one transaction or a series of
related transactions, to any Person, or (iii) permit any Person to merge with
or into the Guarantor, unless, in any such case:

 

(A)                  except in the
case of Holdings, the other Person is the Company or any Restricted Subsidiary
that is Guarantor or becomes a Guarantor concurrently with the transaction; or

 

(B)                    (1)                     either (x) a Guarantor
is the continuing Person or (y) the resulting, surviving or transferee Person
expressly assumes all of the obligations of the Guarantor under the Credit
Documents to which such Guarantor is a party; and

 

(2)                       immediately
after giving effect to the transaction, no Default has occurred and is
continuing; or

 

(C)                    except in the
case of Holdings, the transaction constitutes a sale or other disposition
(including by way of consolidation or merger) of the Guarantor or the sale or
disposition of all or substantially all the assets of the Guarantor (in each
case other than to the Company or a Restricted Subsidiary) otherwise permitted
by this Agreement.

 

10.11.      Impairment of Liens.
The Company shall not, and shall not permit any Restricted Subsidiary to, take
or omit to take any action that would have the result of materially impairing
the Lien with respect to the Collateral (it being understood that the
Incurrence of Permitted Collateral Liens shall under no circumstances be deemed
to materially impair the Lien with respect to the Collateral) for the benefit
of the Secured Parties, and the Company shall not, and shall not permit any
Restricted Subsidiary to, grant to any Person other than a Collateral

 

126

 

Agent, for the benefit of
the Secured Parties, any interest whatsoever in any of the Collateral, except
that the Company and its Restricted Subsidiaries may Incur Permitted Collateral
Liens and the Collateral may be discharged and released in accordance with the
Credit Documents.

 

SECTION 11.                                    Events
of Default

 

11.1.            Events of Default. Any of the following shall constitute an
Event of Default:

 

(a)                      Non-Payment of Interest. Default in any payment of interest on any
Loan, L/C Advance or any Unpaid Drawing when due and payable and such default
continues for 30 days;

 

(b)                     Non-Payment of Principal. Default in the payment of the principal
amount of or premium, if any, on any Loan or any Unpaid Drawing when due at its
Stated Maturity, upon optional redemption, upon required repurchase, upon
declaration or otherwise;

 

(c)                      Breach of Specific Covenants. Failure to comply for 30 days after notice
by the Administrative Agent on behalf of the Lenders or the Required Lenders
with any covenant, warranty or other agreement with respect to Section 9.11,
Section 9.12 or Section 10;

 

(d)                     Breach of Other Covenants. Failure to comply for 60 days after notice
by the Administrative Agent on behalf of the Lenders or the Required Lenders
with its other agreements (not specified in clause (a), (b) or (c) above)
contained in any Credit Document;

 

(e)                      Cross-Default. Any Credit Party or any Restricted
Subsidiary (i) fails to make any payment beyond the applicable grace period
with respect thereto, if any (whether by scheduled maturity, required
prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness
(other than Indebtedness under the Credit Documents and Indebtedness referred
to in clauses (d) and (f) of the definition thereof) having an aggregate
principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than €100,000,000 or (ii) fails to observe or
perform any other agreement or condition relating to any such Indebtedness or
contained in any instrument or agreement evidencing, securing or relating
thereto, or any other event occurs, the effect of which default or other event
is to cause, or to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased, prepaid,
defeased or redeemed (automatically or otherwise), or an offer to repurchase,
prepay, defease or redeem such Indebtedness to be made, prior to its stated
maturity provided that this sub-clause (ii) shall not apply to secured
Indebtedness that becomes due as a result of the voluntary sale or transfer of
the property or assets securing such Indebtedness, if such sale or transfer is
permitted hereunder;

 

(f)                        Change of Control. Any Change of Control occurs;

 

127

 

(g)                     Insolvency. Any Credit Party or any of the Restricted Subsidiaries institutes or
consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator, administrator, administrative receiver or similar office is appointed
without the application or consent of such Person and the appointment continues
undischarged or unstayed for sixty (60) calendar days; or any proceeding under
any Debtor Relief Law relating to any such Person or to all or any material
part of its property or assets is instituted without the consent of such Person
and continues undismissed or unstayed for (60) calendar days, or an order for
relief is entered in any such proceeding;

 

(h)                     Breach of Representations. Any representation or warranty made or
deemed made by any Credit Party (or any of its officers) under or in connection
with any Credit Document shall prove to have been incorrect in any material
respect when made or deemed made;

 

(i)                         Security Documents. (i) Any Lien under the Security Document on
any material Collateral shall, at any time, cease to be in full force and
effect (other than in accordance with the terms of the relevant Security
Document and this Agreement) for any reason other than the satisfaction in full
of all of the Secured Obligations or the release of any such Lien in accordance
with the terms hereof or (ii) any Security Document or any Lien created
thereunder on any material Collateral shall be declared invalid or
unenforceable or a Borrower shall assert in writing that any such Lien is
invalid or unenforceable, and, in any such case, such event or circumstance
continues for 10 days.

 

(j)                         Judgments. Failure by any Credit Party or any Significant Subsidiary or group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for Holdings, the Borrowers and their
Restricted Subsidiaries), would constitute a Significant Subsidiary, to pay
final judgments aggregating in excess of €100,000,000 (exclusive of any amounts
that a solvent insurance company has acknowledged liability for), which
judgments are not paid, discharged or stayed for a period of 60 days after the
judgment becomes final; or

 

(k)                      Guaranty. The Guaranty ceases to be in full force and effect, other than in
accordance the terms of the Credit Documents and the Agreed Security
Principles, or a Guarantor denies or disaffirms its obligations under the
Guaranty, other than in accordance with the terms thereof or upon release of
the Guaranty in accordance with the Credit Documents;

 

then, and in any such
event, and at any time thereafter, if any Event of Default shall then be
continuing, the Administrative Agent shall, upon the written request of the
Required Lenders, by written notice to the Borrowers, take any or all of the following
actions, without prejudice to the rights of the Administrative Agent or any
Lender to enforce its claims against the Borrowers, except as otherwise
specifically provided for in this Agreement: (i) declare the Total Commitment
terminated, whereupon the Commitments of each Lender shall forthwith terminate
immediately and any Fees theretofore accrued shall forthwith become due and
payable without any other notice of any kind; (ii) declare the principal of and
any accrued interest and fees in respect of all Loans, L/C Advances and all
other amounts owing hereunder or under any other

 

128

 

Credit Document to be,
whereupon the same shall become, forthwith due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrowers; (iii) terminate any Letter of Credit that may be terminated in
accordance with its terms; and/or (iv) direct the Company to Cash Collateralize
the aggregate Stated Amount of all Letters of Credit then outstanding, provided
that upon the occurrence of any Event of Default under Section 11.1 (g) the
Total Commitment and Commitment of each Lender shall automatically terminate,
the unpaid principal amount of all outstanding Loans, L/C Advances and all
interest and other amounts as aforesaid shall automatically become due and
payable, and the obligation of the Company to Cash Collateralize the then
Letters of Credit Outstanding as aforesaid shall automatically become
effective, in each case without further act of the Administrative Agent or any
Lender.

 

11.2.            Clean-up Period. (a) Notwithstanding any other terms of this
Agreement, during the period commencing on the Closing Date and expiring 90
days after the Closing Date (the “Clean-up Period”), if any matter or
circumstance that exists in respect of the Company or any of its Subsidiaries
would constitute (i) a breach of a representation or warranty made in Section
8; or (ii) a breach of an undertaking in Section 9 or Section 10; or (iii) a
Default or an Event of Default, (a “Relevant Default”) then:

 

(A)                  promptly upon
becoming aware of its occurrence, the Company shall notify the Administrative
Agent of that Relevant Default and the related event or circumstance (and the
steps, if any, being taken to remedy it); and

 

(B)                    subject to clause (b) below, during the
Clean-up Period that Relevant Default shall not constitute a Default or an
Event of Default and the Administrative Agent shall not be entitled to take any
action under Section 11.1 with respect to that Relevant Default until (if that
Relevant Default is then continuing) the earlier of (1) the date immediately
after the end of the Clean-up Period; and (2) the date (if any) on which a
Material Adverse Effect occurs as a result of that Relevant Default.

 

(b)                     Clause (a)(B)
above shall not apply with respect to any Relevant Default to the extent that:

 

(i)                         the Relevant Default is not capable of remedy;
or

 

(ii)                      the Relevant
Default is capable of remedy and reasonable steps are not being taken to remedy
it within 20 Business Days of the Administrative Agent giving notice to the
Company or the Company becoming aware of the occurrence of that Relevant
Default; or

 

(iii)                   the Relevant
Default has been procured by or approved by the Company or Holdings.

 

129

 

(c)                      For the avoidance of doubt, subject to Section
7.3, clause (a)(B) above shall not restrict the Administrative Agent’s right to
take any action under Section 11.1 with respect to any Default or Event of
Default which is not a Relevant Default.

 

11.3.            No Breach for Reorganization or Refinancing. Notwithstanding any other provision of this
Agreement, no Credit Party shall be in breach of any of its obligations under
Section 9 or Section 10 as a result of any actions or steps taken in order to
complete the Reorganization and, to the extent applicable, the Refinancing, to
the extent not finalized on the Closing Date, in accordance with terms of the
Acquisition Agreement, including the schedules thereto (which for the purposes
of this Section 11.3 shall mean the execution version of the Acquisition
Agreement dated September 27, 2006) and the Acquisition Side Letter (in the
form in effect on the date hereof) which, in each case, shall not have been
altered, amended or otherwise changed or supplemented or any condition therein
waived, or, any right or power exercised pursuant to Section 6.3 of the
Acquisition Agreement, in a manner materially adverse to the Lenders without
the prior written consent of the Required Lenders.

 

11.4.            Application of Funds. After the exercise of remedies as provided in
Section 11.1 (or after the Commitments have been automatically cancelled,
Loans, L/C Advances and all other amounts have automatically become due and
payable and the Letters of Credit Outstanding have automatically been required
to be Cash Collateralized as set forth in the proviso to Section 11.1), any
amounts received by the Administrative Agent on account of the Secured
Obligations shall be applied in accordance with Section 4 of the Collateral
Agency Agreement.

 

SECTION 12.                                    The Agents

 

12.1.            Appointment (a) Each Lender hereby irrevocably designates and appoints the
Administrative Agent as the agent of such Lender under this Agreement and the
other Credit Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Credit Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Credit
Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Credit Document or otherwise exist against the
Administrative Agent.

 

(b)                     The Administrative Agent, each Lender and each
Letter of Credit Issuer hereby irrevocably designate and appoint each
Collateral Agent as its agent under this Agreement and the other Credit
Documents, and the Administrative Agent, each Lender and each Letter of Credit
Issuer irrevocably authorize each Collateral Agent, in such capacity, to take
such action on their behalf under the provisions of this Agreement and the
other Credit Documents and to exercise such powers and perform such duties as
are expressly delegated to each Collateral Agent by the terms of this Agreement
and the other Credit Documents, together

 

130

 

with such other powers as
are reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, each Collateral Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with the Administrative Agent, any Lender or any Letter of Credit
Issuer, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other
Credit Document or otherwise exist against a Collateral Agent.

 

(c)                      Each Joint Lead Arranger, each Joint
Bookrunner, the Syndication Agent and the Documentation Agent, each in its
capacity as such, shall not have any obligations, duties or responsibilities
under this Agreement but shall be entitled to all benefits of this Section 12.

 

(d)                     Each Lender and Letter of Credit Issuer confirms
that each Joint Lead Arranger and the Administrative Agent has authority to
accept on its behalf (and ratifies the acceptance on its behalf of any letters
or reports already accepted by the Joint Lead Arranger or Administrative Agent)
the terms of any reliance letter or engagement letters relating to any reports
or letters provided by accountants in connection with the Credit Documents or
the transactions contemplated in the Credit Documents (including any net asset
letter in connection with the financial assistance procedures) and to bind it
in respect of those reports or letters and to sign such letters on its behalf
and further confirms that it accepts the terms and qualifications set out in
such letters.

 

12.2.            Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Credit Documents by or through
agents or attorneys- in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

 

12.3.            Exculpatory Provisions. No Agent nor any of its respective officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (a)
liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Credit Document
(except for its or such Person’s own gross negligence or willful misconduct) or
(b) responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower, any Guarantor,
any other Credit Party or any officer thereof contained in this Agreement or
any other Credit Document or in any certificate, report, statement or other
document referred to or provided for in, or received by the Administrative
Agent or any Collateral Agent under or in connection with, this Agreement or
any other Credit Document, or the perfection or priority of any Lien or
security interest created or purported to be created under the Security
Documents, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Credit Document or
for any failure of the Borrower, any Guarantor or any other Credit Party to
perform its obligations hereunder or thereunder. No Agent shall be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Credit Document, or to inspect the properties, books or
records of any Credit Party.

 

131

 

12.4.            Reliance by Agents.
Each Agent shall be entitled to rely, and shall be fully protected in relying,
upon any writing, resolution, notice, consent, certificate, affidavit, letter,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including counsel to any Credit Party), independent accountants
and other experts selected by such Agent. Each Agent may deem and treat the
Lender specified in the Register with respect to any amount owing hereunder as
the owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent. Each Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Credit Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action.
Each Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement and the other Credit Documents in accordance
with a request of the Required Lenders (or such greater number or percentage of
Lenders as may be expressly required by this Agreement in any instance), and
such request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders and all future holders of the Loans.

 

12.5.            Notice of Default.
No Agent shall be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default hereunder unless it has received notice from a
Lender or a Borrower referring to this Agreement, describing such Default or
Event of Default and stating that such notice is a “notice of default”. In the
event that the Administrative Agent receives such a notice, it shall give
notice thereof to the Lenders. The Administrative Agent shall take such action
with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders, provided that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Lenders (except to the extent
that this Agreement requires that such action be taken only with the approval
of the Required Lenders or each of the Lenders, as applicable).

 

12.6.            Non-Reliance on
Agents and Other Lenders. Each Lender expressly acknowledges that no Agent
nor any of its respective officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to
it and that no act by any Agent hereinafter taken, including any review of the
affairs of a Borrower, any Guarantor or any other Credit Party, shall be deemed
to constitute any representation or warranty by any Agent to any Lender or any
Letter of Credit Issuer. Each Lender and Letter of Credit Issuer represents to
each Agent that it has, independently and without reliance upon such Agent or
any other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of
each Borrower, any Guarantor and any other Credit Party and made its own
decision to make its Loans hereunder and enter into this Agreement. Each Lender
also represents that it will, independently and without reliance upon any Agent
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time,

 

132

 

continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Credit Documents, and to make such investigation
as it deems necessary to inform itself as to the business, operations,
property, financial and other condition and creditworthiness of any Borrower,
any Guarantor and any other Credit Party. Except for notices, reports and other
documents expressly required to be famished to the Lenders by the
Administrative Agent hereunder, no Agent shall have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, assets, operations, properties, financial condition, prospects or
creditworthiness of any Borrower, any Guarantor or any other Credit Party that
may come into the possession of such Agent any of its respective officers,
directors, employees, agents, attorneys-in-fact or Affiliate.

 

12.7.            Indemnification.
The Lenders agree to indemnify each Agent, each in its capacity as such (to the
extent not reimbursed by any Credit Party and without limiting the obligation
of any Credit Party to do so), ratably according to their respective portions
of the Total Credit Exposure in effect on the date on which indemnification is
sought (or, if indemnification is sought after the date upon which the
Commitments shall have terminated and the Loans shall have been paid in full,
ratably in accordance with their respective portions of the Total Credit
Exposure in effect immediately prior to such date), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever that may at any
time (including at any time following the payment of the Loans) be imposed on,
incurred by or asserted against such Agent in any way relating to or arising
out of, the Commitments, this Agreement, any of the other Credit Documents or
any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
such Agent under or in connection with any of the foregoing, provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from such Agent’s gross
negligence or willful misconduct; it being acknowledged and agreed that no
action taken in accordance with the instructions of the Required Lenders (or
such other number or percentage of the Lenders as shall be required by the
Credit Documents) shall constitute gross negligence or willful misconduct. The
agreements in this Section 12.7 shall survive termination of the Commitment,
the repayment of the Loans and all other amounts payable hereunder.

 

12.8.            Agents in their
Individual Capacity. Each Agent and its Affiliates may make loans to,
accept deposits from and generally engage in any kind of business with any
Borrower, any Guarantor, and any other Credit Party as though it were not an
Agent hereunder and under the other Credit Documents. With respect to the Loans
made by it, each Agent shall have the same rights and powers under this
Agreement and the other Credit Documents as any Lender and may exercise the
same as though it were not an Agent, and the terms “Lender” and “Lenders” shall
include each Agent in its individual capacity.

 

12.9.            Successor Agents.
The Administrative Agent may resign as Administrative Agent upon 20 days’ prior
written notice to the Lenders and the Borrowers. If the Administrative Agent
shall resign as Administrative Agent under this Agreement and the other Credit
Documents, then the Required Lenders shall appoint from among the Lenders a
successor Administrative Agent which successor agent shall be approved by the
Company (which approval

 

133

 

shall not be unreasonably
withheld or delayed) so long as no Default or Event of Default is continuing.
If no successor agent has accepted appointment as the Administrative Agent by
the date which is twenty (20) days following the retiring Administrative
Agent’s notice of resignation, the retiring Administrative Agent’s resignation
shall nevertheless thereupon become effective and the Lenders shall perform all
of the duties of the Administrative Agent hereunder until such time, if any, as
the Required Lenders appoint a successor agent as provided for above. Upon the
acceptance of any appointment as the Administrative Agent hereunder by a
successor (or upon the Lenders assuming such role as provided above) and upon
the execution and filing or recording of such financing statements, or
amendments thereto, and such amendments or supplements to the Security
Documents, and such other instruments or notices, as may be necessary or
desirable, as the Required Lenders may request, in order to (a) continue the
perfection of the Liens granted or purported to be granted by the Security
Documents or (b) otherwise ensure that the requirements set forth in Section
9.11 are satisfied, the Administrative Agent shall thereupon succeed to the
rights, powers and duties of the Administrative Agent and the term
“Administrative Agent” shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent’s rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. After any retiring
Administrative Agent’s resignation as Administrative Agent, the provisions of
this Section 12 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this Agreement and
the other Credit Documents..

 

12.10.      Withholding Tax and
Deductions. To the extent required by any applicable Law, the
Administrative Agent may withhold from any interest payment to any Lender an
amount equivalent to any applicable withholding tax. If the Internal Revenue Service
or any authority of the United States or other jurisdiction asserts a claim
that the Administrative Agent did not properly withhold tax from amounts paid
to or for the account of any Lender (because the appropriate form was not
delivered, was not properly executed, or because such Lender failed to notify
the Administrative Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason), such Lender shall indemnify the Administrative Agent (to the extent
that the Administrative Agent has not already been reimbursed by a Credit Party
and without limiting the obligation of any Credit Party to do so) fully for all
amounts paid, directly or indirectly, by the Administrative Agent as tax or
otherwise, including penalties and interest, together with all expenses
incurred, including legal expenses, allocated staff costs and any out of pocket
expenses.

 

12.11.      Administrative Agent May
File Proofs of Claim. In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Credit Party, the
Administrative Agent (irrespective of whether the principal of any Loan or
Unpaid Drawing shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether the Administrative Agent
shall have made any demand on any Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise:

 

134

 

(a)                      to file and
prove a claim for the whole amount of the principal and interest owing and
unpaid in respect of the Loans, Unpaid Drawings and all other Secured
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the Letter
of Credit Issuers and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders,
Letter of Credit Issuers and the Administrative Agent and their respective
agents and counsel and all other amounts due the Lenders, Letter of Credit
Issuers and the Administrative Agent under Sections 4.1 and 14.5) allowed in
such judicial proceeding; and

 

(b)                     to collect
and receive any monies or other property payable or deliverable on any such
claims and to distribute the same;

 

and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender and Letter
of Credit to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders and Letter of Credit Issuers, to pay to the Administrative
Agent any amount due for the reasonable compensation, expenses, disbursements
and advances of the Agents and their respective agents and counsel, and any
other amounts due the Administrative Agent under Sections 4.1 and 14.5.

 

Nothing contained
herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender or Letter of Credit
Issuer any plan of reorganization, arrangement, adjustment or composition
affecting the Secured Obligations or the rights of any Lender or Letter of
Credit Issuer or to authorize the Administrative Agent to vote in respect of
the claim of any Lender in any such proceeding.

 

12.12.      Joint and Several Claims.
Each of the Agents, Lenders and Letter of Credit Issuers hereby agree that as
regards any Collateral located in or related to the Republic of China, the
Taiwan Collateral Agent shall be deemed to be a creditor jointly and severally
with each of them with respect to the rights and claims against the Credit Parties
hereunder and under any of the other Credit Documents pursuant to Article 283
of the Republic of China Civil Code and that the Taiwan Collateral Agent shall
be entitled to exercise and pursue all such rights and claims against the
Credit Parties in its capacity as a joint and several creditor and for the
joint and several benefit of the Agents, Lenders and Letter of Credit Issuers.

 

SECTION 13.                                    Miscellaneous

 

13.1.            Professional Market
Party Representations. (a) For the purpose of this Section 13.1, each
Lender includes the domestic or foreign branch office or Affiliate making a
Loan and each Letter of Credit Issuer includes its Affiliates issuing Letters
of Credit.

 

(b)                     Without
limiting the Borrower’s obligations under the Dutch Banking Act and the Exemption
Regulation to the Dutch Banking Act, each Lender and Letter of Credit Issuer
which is a party to this Agreement on the date hereof represents and warrants
to each party to this Agreement on the date hereof that it is a PMP.

 

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(c)                      If, on the
date on which a party becomes a Lender or a Letter of Credit Issuer (as the
case may be), it is a requirement of Dutch law that such party be a PMP, each
such new Lender or Letter of Credit Issuer represents and warrants to each
party to this Agreement on the date on which it becomes a party to this
Agreement as a Lender or a Letter of Credit Issuer (as the case may be) that it
is a PMP.

 

(d)                     Each Lender
and Letter of Credit Issuer acknowledges that (i) it is aware of the
consequences of the representation and warranty made by it under this Section
13.1 and (ii) each of the Agents and other Lenders and Dutch Borrowers has
relied upon such representation and warranty.

 

13.2.            Amendments and
Waivers. (a) Neither this Agreement nor any other Credit Document, nor any
terms hereof or thereof may be amended, supplemented, modified or waived except
in accordance with the provisions of this Section 13.2. The Required Lenders
may, or, with the written consent of the Required Lenders, the Administrative
Agent may, from time to time (i) enter into with the relevant Credit Party or
Credit Parties written amendments, supplements, modifications or waivers hereto
and to the other Credit Documents for the purpose of adding any provisions to
this Agreement or the other Credit Documents or changing in any manner the
rights of the Lenders or of the Credit Parties hereunder or thereunder or (ii)
waive in writing, on such terms and conditions as the Required Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any
of the requirements of this Agreement or the other Credit Documents or any
Default or Event of Default and its consequences; provided, however,
that no such waiver and no such amendment, supplement, modification or waiver
shall directly (A) forgive or reduce or waive any portion of any Loan or L/C
Advance or extend the final scheduled maturity date of any Loan or any L/C
Advance or reduce the stated rate (it being understood that any change to the
definition of Net Leverage Ratio or in the component definitions thereof shall
not constitute a reduction in the rate and only the consent of the Required
Lenders shall be necessary to waive any obligation of the Borrowers to pay
interest at the “default rate” or amend Section 2.8), or forgive any portion,
or extend the date for the payment, of any interest or fee payable hereunder
(other than as a result of waiving the applicability of any post-default
increase in interest rates), or extend the final expiration date of any
Lender’s Commitment or extend the final expiration date of any Letter of Credit
beyond the L/C Maturity Date, or increase the aggregate amount of the
Commitments of any Lender, or amend or modify any provisions of Section 5.3(a)
(with respect to the ratable allocation of any payments only) and 13.11(a), in
each case without the written consent of each Lender directly and adversely
affected thereby, (B) amend, modify or waive any provision of this Section 13.2
or reduce the percentages specified in the definitions of the terms “Required
Lenders” or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, or consent to the
assignment or transfer by any Borrower of its rights and obligations under any
Credit Document to which it is a party (except as permitted pursuant to
Sections 10.9 or 10.10), (in any such case) without the written consent of each
Lender, (C) amend Section 2.14 or the definition of “Alternative Currency” in
each case without the written consent of each Lender directly and adversely
affected thereby, (D) amend, modify or waive any provision of Section 12
without the written consent of each Agent, (E) in addition to the Lenders required
above, amend, modify or waive any provision hereof relating to a Letter of
Credit Issuer or to

 

136

 

any Letter of Credit
without the written consent of each Letter of Credit Issuer, or (F) release all
or substantially all of the Guarantors under the Guaranty (except as expressly
permitted by the Guaranty) or release all or substantially all of the
Collateral under any of the Security Documents, without the prior written
consent of each Lender and each Letter of Credit Issuer, or (G) amend Section
2.9 so as to permit Interest Periods of greater than six months without the
written consent of each Lender directly and adversely affected thereby, or (H)
affect the rights, duties, privileges, liabilities or obligations of, or any
fees or other amounts payable to, the Administrative Agent under this Agreement
or the other Credit Documents, without the written consent of the
Administrative Agent. Any such waiver and any such amendment, supplement or
modification shall apply equally to each of the affected Lenders and shall be
binding upon the Borrowers, the Lenders, the Administrative Agent and all
future holders of the affected Loans. In the case of any waiver, the Borrowers,
the Lenders and the Administrative Agent shall be restored to their former
positions and rights hereunder and under the other Credit Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing, it being understood that no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon.

 

(b)                     Notwithstanding
anything to the contrary herein, no Defaulting Lender shall have any right to
approve or disapprove any amendment, waiver or consent hereunder, except that
the Commitment of such Lender may not be increased or extended without the
consent of such Lender (it being understood that any Commitments or Loans held
or deemed held by any Defaulting Lender shall be excluded for a vote of the
Lenders hereunder requiring any consent of the Lenders).

 

(c)                      In the event
that any covenant contained in any Note Indenture is amended, varied, modified,
supplemented or replaced as a result of negotiations with potential investors
in the Senior Notes prior to the issue date of such Senior Notes, the Lenders
or the Company shall have the right to require that the corresponding covenant
herein is so amended, varied, modified, supplemented or replaced and the
Borrowers and the Lenders shall promptly execute such documents as may be
required to give effect to any such amendment, variation, modification,
supplement or replacement.

 

13.3.            Notices. Unless
otherwise expressly provided herein, all notices and other communications
provided for hereunder or under any other Credit Document shall be in writing
(including by facsimile transmission). All such written notices shall be
mailed, faxed or delivered to the applicable address, facsimile number or
electronic mail address, and all notices and other communications expressly
permitted hereunder to be given by telephone shall be made to the applicable
telephone number, as follows:

 

(a)                      if to a
Borrower, the Administrative Agent, any Collateral Agent or any Letter of
Credit Issuer, to the address, facsimile number, electronic mail address or
telephone number specified for such Person on Schedule 13.2 or to such other
address, facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the other parties; and

 

137

 

(b)                     if to any
other Lender, to the address, facsimile number, electronic mail address or
telephone number specified in its Administrative Questionnaire or to such other
address, facsimile number, electronic mail address or telephone number as shall
be designated by such party in a notice to the Borrowers, the Administrative
Agent, any Collateral Agent and the Letter of Credit Issuers.

 

All such notices and
other communications shall be deemed to be given or made upon the earlier to
occur of (i) actual receipt by the relevant party hereto and (ii) (A) if
delivered by hand or by courier, when signed for by or on behalf of the
relevant party hereto; (B) if delivered by mail, three (3) Business Days after
deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail, when delivered; provided that notices and other communications to
the Administrative Agent or the Lenders pursuant to Sections 2.3, 2.6, 2.9,
3.2, 4.2 and 5.1 shall not be effective until received.

 

13.4.            No Waiver:
Cumulative Remedies. No failure to exercise and no delay in exercising, on
the part of the Administrative Agent, a Collateral Agent, any Lender or any
Letter of Credit Issuer, any right, remedy, power or privilege hereunder or
under the other Credit Documents shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.

 

13.5.            Survival of
Representations and Warranties. All representations and warranties made
hereunder, in the other Credit Documents and in any document, certificate or
statement delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the making of the Loans and the
issuance of Letters of Credit hereunder.

 

13.6.            Payment of Expenses
and Taxes. The Company and the Co-Borrower jointly and severally agree (a)
to pay or reimburse the Agents for all their reasonable out-of- pocket costs
and expenses incurred after the Closing Date in connection with any amendment,
supplement or modification to, this Agreement and the other Credit Documents
and any other documents prepared in connection therewith including the
reasonable fees, disbursements and other charges of the Administrative Agent’s
counsel, (b) to pay or reimburse each Lender, Agent and Letters of Credit
Issuers for all its reasonable and documented costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, the other Credit Documents and any such other documents, including
the reasonable fees, disbursements and other charges of counsel to each Lender,
the Agents and each Letter of Credit Issuer, (c) subject to the Agreed Security
Principles, to pay, indemnify, and hold harmless each Lender, each Letter of
Credit Issuer and Agent from, any and all recording and filing fees incurred on
or after the Closing Date and (d) to pay, indemnify, and hold harmless each
Lender, Letter of Credit Issuer and Agent and their respective directors,
officers, employees, advisors and agents from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever,
including

 

138

 

reasonable and documented
fees, disbursements and other charges of counsel, with respect to the
enforcement, performance and (except in the case of each Agent and Letter of
Credit Issuer) administration of this Agreement, the other Credit Documents and
any such other documents, including, without limitation, any of the foregoing
relating to any violation of, noncompliance with or liability under, any
Environmental Law or to any actual or alleged presence, release or threatened
release of Hazardous Materials involving or attributable to the operations of
any Borrower, any of its Subsidiaries (all the foregoing in this clause (d),
collectively, the “indemnified  liabilities”), provided
that the Company and the Co-Borrower shall have no obligation hereunder to the
Administrative Agent, any Lender or any Letter of Credit Issuer nor any of
their respective Related Parties with respect to indemnified liabilities to the
extent attributable to (i) the gross negligence or willful misconduct of the
party to be indemnified or any of its Related Parties or (ii) disputes among
the Administrative Agent, the Lenders, the Letters of Credit Issuers and/or
their transferees. All amounts payable under this Section 13.6 shall be paid
within ten Business Days of receipt by the Company or the Co-Borrower (as the
case may be) of an invoice relating thereto setting forth such expense in
reasonable detail. The agreements in this Section 13.6 shall survive
resignation of any Agent, the replacement of any Lender or Letter of Credit
Issuer, the termination of the Total Commitments and repayment of the Loans and
all other amounts payable hereunder.

 

13.7.            Successors and
Assigns; Participations and Assignments. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby (including any
Affiliate of the Letter of Credit Issuer that issues any Letter of Credit),
except that (i) no Borrower may assign or otherwise transfer any of its rights
or obligations hereunder without the prior written consent of each Lender (and
any attempted assignment or transfer by any Borrower or without such consent
shall be null and void) and (ii) no Lender may assign or otherwise transfer its
rights or obligations hereunder except in accordance with this Section 13.7.
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby (including any Affiliate of the Letter of Credit Issuer
that issues any Letter of Credit), Participants (to the extent provided in
paragraph (c) of this Section 13.7) and, to the extent expressly contemplated
hereby, the Related Parties of each of the Administrative Agent, the Letter of
Credit Issuer and the Lenders) any legal or equitable right, remedy or claim
under or by reason of this Agreement.

 

(b)                     (i) Subject
to the conditions set forth in paragraph (b)(ii) below, any Lender may assign
to one or more assignees all or a portion of its rights and obligations under
this Agreement (including all or a portion of its Commitments and the Loans at
the time owing to it) with the prior written consent (such consent not be
unreasonably withheld or delayed; it being understood that, without limitation,
the Company shall have the right to withhold its consent to any assignment if,
in order for such assignment to comply with applicable Law, the Company would
be required to obtain the consent of, or make any filing or registration with,
any Governmental Authority) of:

 

(A)                  the Company
(which consent shall not be unreasonably withheld or delayed), provided
that no consent of the Company shall be required for an assignment to a Lender,
an Affiliate of a Lender, an Agent or an Affiliate of an

 

139

 

Agent (unless increased costs
would result therefrom except if an Event of Default under Section 11.1(a), (b)
or, with respect to any Credit Party, (g) has occurred and is continuing), an
Approved Fund or, if an Event of Default under Section 11.1(a), (b) or, with
respect to any Credit Party, (g) has occurred and is continuing, any other
assignee; and

 

(B)                    the
Administrative Agent (which consent shall not be unreasonably withheld or
delayed) and the Letter of Credit Issuers, provided that no consent of
the Administrative Agent or any Letter of Credit Issuer, as applicable, shall
be required for an assignment of (1) any Commitment to an assignee that is a
Lender or (2) any Loan to a Lender, an Affiliate of a Lender, an Agent or an
Affiliate of an Agent or an Approved Fund.

 

(ii)                      Assignments
shall be subject to the following additional conditions:

 

(A)                  except in the
case of an assignment to a Lender, an Affiliate of a Lender, an Agent or an
Affiliate of an Agent or an Approved Fund or an assignment of the entire
remaining amount of the assigning Lender’s Commitment or Loans, the amount of
the Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
€5,000,000, and whole increments of €1,000,000 in excess thereof, unless each
of the Company and the Administrative Agent otherwise consents (which consents
shall not be unreasonably withheld or delayed), provided that no such consent
of the Company shall be required if an Event of Default under Section 11.1(a),
(b) or, with respect to any Credit Party, (g) has occurred and is continuing; provided,
further, that contemporaneous assignments to a single assignee made by
Affiliates of Lenders and related Approved Funds shall be aggregated for
purposes of meeting the minimum assignment amount requirements stated above;

 

(B)                    each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement;

 

(C)                    the parties to
each assignment shall execute and deliver to the Administrative Agent an
Assignment and Acceptance, together with a processing and recordation fee of €3,500,
provided that the Administrative Agent may, in its sole discretion,
elect to waive such processing and recordation fee, and provided  further
that only one such fee shall be payable in the event of simultaneous
assignments to or from two or more Approved Funds; and

 

(D)                   the assignee,
if it shall not be a Lender, shall deliver to the Administrative Agent an
administrative questionnaire in a form approved by the Administrative Agent
(the “Administrative Questionnaire”).

 

140

 

For
the purpose of this Section 13.7(b), the term “Approved
Fund” means any Person (other than a natural person) that is (or will at
the time of the relevant assignment be) engaged in making, purchasing, holding
or investing in bank loans and similar extensions of credit in the ordinary
course and that is managed by (a) a Lender, (b) an Affiliate of a Lender or (c)
an entity or an Affiliate of an entity that manages a Lender.

 

(iii)                   Subject to
acceptance and recording thereof pursuant to paragraph (b)(v) of this Section
13.7, from and after the effective date specified in each Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the extent
of the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender thereunder
shall, to the extent of the interest assigned by such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of the assigning Lender’s
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections
2.10, 2.11, 3.5, 5.4 and 13.6). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
Section 13.7 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section 13.7.

 

(iv)                  The
Administrative Agent, acting for this purpose as an agent of the Borrowers
shall maintain at the Administrative Agent’s Office a copy of each Assignment
and Acceptance delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitments of, and principal amount of
the Loans and any payment made by the Letter of Credit Issuer under any Letter
of Credit owing to, each Lender pursuant to the terms hereof from time to time
(the “Register”). Further, the Register
shall contain the name and address of the Administrative Agent and the lending
office through which each such Person acts under this Agreement. The entries in
the Register shall be conclusive, and the Borrowers, the Administrative Agent,
the Letter of Credit Issuer and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrowers, the Letter of
Credit Issuer and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

 

(v)                     Upon its
receipt of a duly completed Assignment and Acceptance executed by an assigning
Lender and an assignee, the assignee’s completed Administrative Questionnaire
(unless the assignee shall already be a Lender hereunder), the processing and
recordation fee referred to in paragraph (b) of this Section 13.7 and any
written consent to such assignment required by paragraph (b) of this Section
13.7, the Administrative Agent shall accept such Assignment and Acceptance and
record the information contained therein in the Register. Promptly following
any change to the Register, the Administrative Agent shall deliver to the
Company an updated version thereof.

 

141

 

(c)                      (i) Any
Lender may, without the consent of the Borrowers, the Administrative Agent or
any Letter of Credit Issuer, sell participations to one or more banks or other
entities (each, a “Participant”) in all or a portion of such Lender’s
rights and obligations under this Agreement (including all or a portion of its
Commitments and the Loans owing to it), provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (C) the Borrowers, the Administrative Agent, the Letter of
Credit Issuers and the other Lenders shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement and (D) at any time it is a requirement of Dutch law on the date
participations are sold to a Participant, such Participant is a PMP. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement or any other Credit Document, provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, modification or waiver
described in the first proviso to Section 13.2 that affects such Participant.
Subject to paragraph (c)(ii) of this Section 13.7, each Borrower agrees that
each Participant shall be entitled to the benefits of Sections 2.10, 2.11 and
5.4 to the same extent as if it were a Lender (subject to the requirements of
those Sections) and had acquired its interest by assignment pursuant to
paragraph (b) of this Section 13.7. To the extent permitted by Law, each
Participant also shall be entitled to the benefits of Section 13.11(b) as
though it were a Lender, provided such Participant agrees to be subject
to Section 13.7(a) as though it were a Lender.

 

(ii)                      A Participant
shall not be entitled to receive any greater payment under Section 2.10 or 5.4
than the applicable Lender would have been entitled to receive with respect to
the participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Company’s prior written
consent (which consent shall not be unreasonably withheld or delayed).

 

(d)                     Any Lender
may, without the consent of the Borrowers or the Administrative Agent, at any
time pledge or assign a security interest in all or any portion of its rights
under this Agreement to secure obligations of such Lender, including any pledge
or assignment to secure obligations to a Federal Reserve Bank, and this Section
13.7 shall not apply to any such pledge or assignment of a security interest, provided
that no such pledge or assignment of a security interest shall release a Lender
from any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto. In order to facilitate such pledge
or assignment, each Borrower hereby agrees that, upon request of any Lender at
any time and from time to time after such Borrower has made its initial
borrowing hereunder, such Borrower shall provide to such Lender, at such
Borrower’s own expense, a promissory note, substantially in the form of Exhibit
E, as the case may be, evidencing the Loans owing to such Lender; provided
that any such promissory note shall be governed by the laws of the State of New
York and the relevant Borrower shall not be required to pay for any
notarization of any such promissory note.

 

(e)                      Subject to
Section 13.19, each Borrower authorizes each Lender to disclose to any
Participant, secured creditor of such Lender or assignee (each, a “Transferee”)

 

142

 

and any prospective
Transferee any and all financial information in such Lender’s possession
concerning the Borrowers and their respective Affiliates that has been
delivered to such Lender by or on behalf of the Borrowers and their respective
Affiliates pursuant to this Agreement or any other Credit Document or which has
been delivered to such Lender by or on behalf of the Borrowers and their
respective Affiliates in connection with such Lender’s credit evaluation of the
Borrowers and their respective Affiliates prior to becoming a party to this
Agreement.

 

13.8.            Replacements of
Lenders under Certain Circumstances. (a) A Borrower shall be permitted to
replace any Lender that (i) requests reimbursement for amounts owing pursuant
to Section 2.10, 3.5 or 5.4; (ii) is affected in the manner described in
Section 2.10(a)(iii) and as a result thereof any of the actions described in
such Section is required to be taken; (iii) becomes a Defaulting Lender; or
(iv) fails to approve an Additional Alternative Currency requested pursuant to
Section 2.14 and with respect to which the Required Lenders shall have approved
such request, with (in any such case) a replacement bank or other financial
institution, provided that (A) such replacement does not conflict with
any Law, (B) no Event of Default shall have occurred and be continuing at the
time of such replacement, (C) such Borrower shall repay (or the replacement
bank or institution shall purchase, at par) all Loans, L/C Advances and other
amounts (other than any disputed amounts), pursuant to Section 2.10, 2.11, 3.5
or 5.4, as the case may be) owing to such replaced Lender prior to the date of
replacement, (D) the replacement bank or institution, if not already a Lender,
and the terms and conditions of such replacement, shall be reasonably satisfactory
to the Administrative Agent and the Letter of Credit Issuer, (E) the replaced
Lender shall be obligated to make such replacement in accordance with the
provisions of Section 13.7 (provided that the relevant Borrower shall be
obligated to pay the registration and processing fee referred to therein) and
(F) any such replacement shall not be deemed to be a waiver of any rights that
such Borrower, the Administrative Agent or any other Lender shall have against
the replaced Lender.

 

(b)                     If any Lender
(such Lender, a “Non-Consenting Lender”) has failed to consent to a
proposed amendment, waiver, discharge or termination which pursuant to the
terms of Section 13.2 requires the consent of all of the Lenders affected and
with respect to which the Required Lenders shall have granted their consent,
then provided no Event of Default then exists, the Company shall have the right
(unless such Non-Consenting Lender grants such consent) to replace such
Non-Consenting Lender by requiring such Non-Consenting Lender to assign its
Loans, and its Commitments hereunder to one or more assignees reasonably
acceptable to the Administrative Agent, provided that: (i) all Secured
Obligations of the Borrowers owing to such Non-Consenting Lender being replaced
shall be paid in full to such Non-Consenting Lender concurrently with such
assignment, and (ii) the replacement Lender shall purchase the foregoing by
paying to such Non-Consenting Lender a price equal to the principal amount
thereof plus accrued and unpaid interest thereon. In connection with any such
assignment, the Borrowers, Administrative Agent, such Non-Consenting Lender and
the replacement Lender shall otherwise comply with Section 13.7.

 

13.9.            Resignation as
Letter of Credit Issuer upon Assignment. (a) Notwithstanding anything to
the contrary contained herein, if at any time a Lender assigns all of its
Commitment and Loans pursuant to this Section 13.9, it may, upon three Business
Days notice to the Company and the Administrative Agent, resign as Letter of
Credit Issuer. In the

 

143

 

event of any such
resignation as Letter of Credit Issuer, the Company shall be entitled to
appoint from among the Lenders a successor Letter of Credit Issuer hereunder in
accordance with Section 3.6; provided, however, that no failure by
the Company to appoint any such successor shall affect the resignation of the
relevant Lender as Letter of Credit Issuer. If a Letter of Credit Issuer
resigns, it shall retain all the rights, powers, privileges and duties of the
Letter of Credit Issuer hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as Letter of Credit
Issuer and all Letter of Credit Exposure with respect thereto (including the
right to require the Lenders to make Loans or fund risk participations in
Unpaid Drawings pursuant to Section 3). Upon the appointment of a successor
Letter of Credit Issuer such successor shall succeed to and become vested with
all of the rights, powers, privileges and duties of the retiring Letter of
Credit Issuer in accordance with Section 3.6.

 

(b)       Notwithstanding anything to the contrary
contained above the Lender that acts as the Administrative Agent may not be
replaced hereunder except in accordance with the terms of Section 12.9.

 

13.10.      Assignment to SPCs.
Notwithstanding anything to the contrary contained herein, any Lender (a “Granting
Lender”) may grant to a special purpose funding vehicle identified as such
in writing from time to time by the Granting Lender to the Administrative Agent
and the Company (an “SPC”) the option to provide all or any part of any
Loan that such Granting Lender would otherwise be obligated to make pursuant to
this Agreement; provided that (i) such SPC makes the representations and
warranties applicable to Lenders set forth in Section 13.1 (ii) nothing herein
shall constitute a commitment by any SPC to fund any Loan, and (iii) if an SPC
elects not to exercise such option or otherwise fails to make all or any part
of such Loan, the Granting Lender shall be obligated to make such Loan pursuant
to the terms hereof. Each party hereto hereby agrees that (i) neither the grant
to any SPC nor the exercise by any SPC of such option shall increase the cost
or expenses or otherwise increase or change the obligations of any Borrower
under this Agreement (including its obligations under Section 2.10, 2.11, 3.5
or 5.4, (ii) no SPC shall be liable for any indemnity or similar payment
obligation under this Agreement for which a Lender would be liable, and (iii)
the Granting Lender shall for all purposes, including the approval of any
amendment, waiver or other modification of any provision of any Credit
Document, remain the lender of record hereunder. The making of a Loan by an SPC
hereunder shall utilize the Commitment of the Granting Lender to the same
extent, and as if, such Loan were made by such Granting Lender. Notwithstanding
anything to the contrary contained herein, any SPC may (i) with notice to, but
without prior consent of any Borrower and the Administrative Agent and with the
payment of a processing fee of €3,500 assign all or any portion of its right to
receive payment with respect to any Loan to the Granting Lender and (ii)
disclose on a confidential basis any non-public information relating to its
funding of Loans to any rating agency, commercial paper dealer or provider of
any surety or Guarantee or credit or liquidity enhancement to such SPC; provided
that the information disclosed shall be limited to the extent necessary to
satisfy the requirements of any such rating agency, commercial paper dealer,
provider of any surety or Guarantee or credit or liquidity enhancement and
shall not include (without the prior written consent of the Company) non-public
projections, forecasts or any other forward looking information provided by, or
relating to, the Company.

 

144

 

13.11.      Adjustments; Set-off.
(a) If any Lender (a “benefited Lender”) shall at any time receive any
payment of all or part of its Loans, or interest thereon, or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, pursuant to events or proceedings of the nature referred to in Section
11.1(g), or otherwise), in a greater proportion than any such payment to or
collateral received by any other Lender, if any, in respect of such other Lender’s
Loans, or interest thereon, such benefited Lender shall purchase for cash from
the other Lenders a participating interest in such portion of each such other
Lender’s Loan, or shall provide such other Lenders with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause such
benefited Lender to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however,
that if all or any portion of such excess payment or benefits is thereafter
recovered from such benefited Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such recovery, but
without interest.

 

(b)                     After the
occurrence and during the continuance of an Event of Default, in addition to
any rights and remedies of the Lenders provided by law, each Lender shall have
the right, without prior notice to any Borrower, any such notice being
expressly waived by each Borrower to the extent permitted by applicable Law,
upon any amount becoming due and payable by a Borrower hereunder (whether at
the stated maturity, by acceleration or otherwise) to set-off and appropriate
and apply against such amount any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any of its Affiliates or any branch or agency thereof
to or for the credit or the account of such Borrower. Each Lender agrees
promptly to notify the relevant Borrower and the Administrative Agent after any
such set-off and application made by such Lender, provided that the
failure to give such notice shall not affect the validity of such set-off and
application.

 

13.12.      Counterparts. This
Agreement may be executed by one or more of the parties to this Agreement on
any number of separate counterparts (including by facsimile or other electronic
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.

 

13.13.      Severability. Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

 

13.14.      Integration. This
Agreement and the other Credit Documents represent the agreement of the Borrowers,
the Collateral Agents, the Administrative Agent and the Lenders with respect to
the subject matter hereof, and there are no promises, undertakings,
representations or warranties by the Borrowers, the Administrative Agent, the
Collateral Agents or any Lender relative to subject matter hereof not expressly
set forth or referred to herein or in the other Credit Documents.

 

145

 

13.15.      GOVERNING LAW. THIS
AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.

 

13.16.      Submission to
Jurisdiction; Waivers. Each party hereto hereby irrevocably and
unconditionally:

 

(a)                      submits for
itself and its property in any legal action or proceeding relating to this
Agreement and the other Credit Documents to which it is a party, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York
and appellate courts from any thereof;

 

(b)                     consents that
any such action or proceeding may be brought in such courts and waives any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
an inconvenient court and agrees not to plead or claim the same;

 

(c)                      in the case
of each Credit Party party hereto (other than the Co-Borrower) appoints the
Co-Borrower (the “Process Agent”) as its agent to receive on behalf of
such Credit Party and its property service of copies of the summons and
complaint and any other process which may be served by the Administrative Agent
or any Lender or Letter of Credit Issuer in any such action or proceeding in
any aforementioned court in respect of any action or proceeding arising out of
or relating to this Agreement. Such service may be made by delivering a copy of
such process to such Credit Party by courier and by certified mail (return
receipt requested), fees and postage prepaid, both (iv) in care of the Process
Agent at the Process Agent’s address and (v) at the relevant Credit Party’s
address specified pursuant to Section 13.3, and each Credit Party hereby
irrevocably authorizes and directs the Process Agent to accept such service on
its behalf that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address set forth on Schedule 13.2 at such other address of which the
Administrative Agent shall have been notified pursuant to Section 13.3;

 

(d)                     agrees that
nothing herein shall affect the right to effect service of process in any other
manner permitted by law or shall limit the right to sue in any other
jurisdiction; and

 

(e)                      waives, to
the maximum extent not prohibited by law, any right it may have to claim or
recover in any legal action or proceeding referred to in this Section 13.16 any
special, exemplary, punitive or consequential damages.

 

13.17.      Acknowledgments. Each
Borrower hereby acknowledges that:

 

(a)                      it has been
advised by counsel in the negotiation, execution and delivery of this Agreement
and the other Credit Documents;

 

146

 

(b)                     no Agent nor any Lender has any fiduciary
relationship with or duty to any Borrower arising out of or in connection with
this Agreement or any of the other Credit Documents, and the relationship
between such Agent and Lenders, on one hand, and the Borrowers, on the other
hand, in connection herewith or therewith is solely that of debtor and
creditor; and

 

(c)                      no joint
venture is created hereby or by the other Credit Documents or otherwise exists
by virtue of the transactions contemplated hereby among the Lenders or among
the Borrowers and the Lenders.

 

13.18.      WAIVERS OF JURY TRIAL. EACH BORROWER, EACH AGENT AND EACH LENDER
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR
ANY COUNTERCLAIM THEREIN.

 

13.19.      Confidentiality. The Administrative Agent and each Lender
shall hold all non-public information furnished by or on behalf of a Borrower
in connection with such Lender’s evaluation of whether to become a Lender
hereunder or obtained by such Lender or the Administrative Agent pursuant to
the requirements of this Agreement (“Confidential Information”),
confidential in accordance with its customary procedure for handling confidential
information of this nature and (in the case of a Lender that is a bank) in
accordance with safe and sound banking practices and in any event may make
disclosure (a) as required or requested by any Governmental Authority or
representative thereof or pursuant to legal process, or (b) to such Lender’s or
the Administrative Agent’s attorneys, professional advisors or independent
auditors or Affiliates, (c) to any other party to this Agreement, (d) to any
pledgee referred to in Section 13.7(d), provided that the information disclosed
shall be limited to the extent necessary to satisfy the requirements of such
pledgee and shall not include (without the prior written consent of the
Company) non-public projections, forecasts or other forward looking information
provided by, or relating to, the Company, (e) to the extent such Confidential
Information becomes publicly available other than as a result of a breach of
this Section 13.19 and (f) otherwise with prior written consent of the Company,
provided that unless specifically prohibited by applicable Law or court
order or similar process, each Lender and the Administrative Agent shall notify
the Company of any request by any Governmental Authority or representative
thereof (other than any such request in connection with an examination of the
financial condition of such Lender by such Governmental Authority) for
disclosure of any such non-public information prior to disclosure of such
information, and provided, further, that in no event shall
any Lender, Letter of Credit Issuer or the Administrative Agent be obligated or
required to return any materials furnished by a Borrower or any Subsidiary of a
Borrower. Each Lender and the Administrative Agent agrees that it will not
provide to prospective Transferees or to prospective direct or indirect
contractual counterparties in Hedge Agreements to be entered into in connection
with Loans made hereunder any of the Confidential Information unless such
Person is advised of and agrees to be bound by the provisions of this Section
13.19.

 

147

 

13.20.      Direct Website Communications.

 

(a)                      (i) A Borrower may, at its option but subject
to the limitations set forth in Sections 9.1 and 9.2, provide to the
Administrative Agent any information, documents and other materials that it is
obligated to furnish to the Administrative Agent pursuant to the Credit
Documents, including, without limitation, all notices, requests, financial
statements, financial and other reports, certificates and other information
materials, but excluding any such communication that (A) relates to a request
for a new, or a conversion of an existing, Borrowing or other Credit Event
(including any election of an Interest rate or Interest Period relating
thereto), (B) relates to the payment of any principal or other amount due under
the Credit Agreement prior to the scheduled date therefor, (C) provides notice
of any Default or Event of Default or (D) is required to be delivered to
satisfy any condition precedent to the effectiveness of the Credit Agreement
and/or any Borrowing or other Credit Event (all such non-excluded
communications being referred to herein collectively as “Communications”),
by transmitting the Communications in an electronic/soft medium in a format
reasonably acceptable to the Administrative Agent to David.Hobbs@morganstanley.com.
Nothing in this Section 13.20 shall prejudice the right of the Borrowers, the
Administrative Agent or any Lender to give any notice or other communication
pursuant to any Credit Document in any other manner specified in such Credit
Document.

 

(ii)                      The Administrative Agent agrees that the receipt of the Communications
by the Administrative Agent at its e-mail address set forth above shall
constitute effective delivery of the Communications to the Administrative Agent
for purposes of the Credit Documents. Each Lender agrees that notice to it (as
provided in the next sentence) specifying that the Communications have been
posted to the Platform shall constitute effective delivery of the
Communications to such Lender for purposes of the Credit Documents. Each Lender
agrees (A) to notify the Administrative Agent in writing (including by
electronic communication) from time to time of such Lender’s e-mail address to
which the foregoing notice may be sent by electronic transmission and (B) that
the foregoing notice may be sent to such e-mail address.

 

(b)                     Each Borrower further agrees that the
Administrative Agent may make the Communications available to the Lenders by
posting the Communications on Intralinks or a substantially similar electronic
transmission system (the “Platform”), so long as the access to such
Platform is limited (i) to the Agents and the Lenders and (ii) remains subject
the confidentiality requirements set forth in Section 13.19.

 

(c)                      The Platform is provided “as is” and “as
available”. The Agent Parties do not warrant the accuracy or completeness of
the Communications, or the adequacy of the Platform and expressly disclaim
liability for errors or omissions in the Communications. No warranty of any
kind, express, implied or statutory, including, without limitation, any
warranty of merchantability, fitness for a particular purpose, non-infringement
of third party rights or freedom from viruses or other code defects, is made by
the Agent Parties in connection with the Communications or the Platform. In no
event shall the Administrative Agent, a Collateral Agent or any of its
Affiliates or any of their respective officers, directors, employees, agents,
advisors or representatives (collectively, “Agent Parties”) have any liability
to any Borrower, any Lender or any other person or entity for damages of any
kind, including, without limitation, direct or indirect, special, incidental or
consequential damages, losses or expenses (whether in tort,

 

148

 

contract
or otherwise) arising out of a Borrower’s or the Administrative Agent’s
transmission of Communications through the internet, except to the extent the
liability of any Agent Party resulted from such Agent Party’s (or any of its
Related Parties) gross negligence or willful misconduct.

 

13.21.      USA PATRIOT Act. Each Lender hereby notifies each Borrower
that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L.
107-56 (signed into law October 26, 2001)) (the “Patriot Act”), it is
required to obtain, verify and record information that identifies the
Borrowers, which information includes the name and address of the Borrowers and
other information that will allow such Lender to identify the Borrowers in
accordance with the Patriot Act.

 

149

 

IN WITNESS WHEREOF,
each of the parties hereto has caused a counterpart of this Agreement to be
duly executed and delivered as of the date first above written.

 

150

 

 

	
   

  	
   

  	
   

  	
   

  	
  KASLION ACQUISITION B.V.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Axel Holtrup

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: AXEL HOLTRUP

  
	
   

  	
   

  	
   

  	
   

  	
  Title: DIRECTOR

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Kees De Ru

  
	
  representing AlpInvest
  Partners N.V. in its turn 

  representing AlpInvest
  Partners 2006 B.V.

  
							

 

 

	
   

  	
   

  	
   

  	
   

  	
  NXP B.V.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Ingen Housz

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: INGEN HOUSZ

  
	
   

  	
   

  	
   

  	
   

  	
  Title: J.M.L.M. 

  
								

 

 

 

	
   

  	
   

  	
   

  	
   

  	
    NXP
  FUNDING LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: [Illegible]

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Secretary

  
								

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  ADMINISTRATIVE
  AGENT AND

  GLOBAL COLLATERAL AGENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  MORGAN
  STANLEY SENIOR 

  FUNDING, INC.,

  as Administrative Agent and as 

  Global Collateral Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Mathias Blumschein

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Mathias Blumschein

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Authorised
  Attorney

  
								

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  JOINT
  LEAD ARRANGERS AND

  JOINT BOOKRUNNERS

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  MORGAN
  STANLEY BANK

  INTERNATIONAL LIMITED,

  as Joint Lead Arranger and Joint

  Bookrunner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Mathias Blumschein

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Mathias Blumschein

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Authorised
  Signatory

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  
									

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  DEUTSCHE
  BANK AG, LONDON

  BRANCH,

  as Joint Lead Arranger and Joint

  Bookrunner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Paul Cahalan

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Paul Cahalan

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Managing
  Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Nick Jansa

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Nick Jansa

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Managing
  Director

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  MERRILL
  LYNCH, PIERCE,

  FENNER & SMITH 

  INCORPORATED,

  as
  Joint Lead Arranger and Joint

  Bookrunner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Anand Melvani

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Anand Melvani

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Director

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  SYNDICATION
  AGENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  DEUTSCHE
  BANK AG, LONDON

  BRANCH,

  as Syndication Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Paul Cahalan

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Paul Cahalan

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Managing
  Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Nick Jansa

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Nick Jansa

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Managing
  Director

  
									

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  DOCUMENTATION
  AGENT

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  MERRILL
  LYNCH CAPITAL

  CORPORATION,

  as Documentation Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Arminee H. Bowler

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Arminee H. Bowler

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Vice President

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  LENDERS

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  MERRILL
  LYNCH CAPITAL

  CORPORATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Arminee H. Bowler

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Arminee H. Bowler

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Vice President

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  MORGAN
  STANLEY SENIOR 

  FUNDING, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Mathias Blumschein

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Mathias Blumschein

  
	
   

  	
   

  	
   

  	
   

  	
  Title:   Authorised
  Attorney

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  DEUTSCHE
  BANK AG, LONDON 

  BRANCH

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Paul Cahalan

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Paul Cahalan

  
	
   

  	
   

  	
   

  	
   

  	
  Title:   Managing
  Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Nick Jansa

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Nick Jansa

  
	
   

  	
   

  	
   

  	
   

  	
  Title:   Managing
  Director

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  BANK
  OF AMERICA, N.A.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Oscar William Cranz
  III

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Oscar
  William Cranz III

  
	
   

  	
   

  	
   

  	
   

  	
  Title:   Principal

  

 

 

 

[GRAPHIC]

 

	
   

  	
   

  	
   

  	
   

  	
  ABN
  AMRO BANK N.V.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Edwin Ezinga

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Edwin Ezinga

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  ASSISTANT DIRECTOR

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  /s/ LA van Waart

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  LA van Waart

  

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  MIZUHO
  CORPORATE BANK, LTD.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ M Kobayashi

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  M Kobayashi

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Joint General Manager

  
									

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  HSBC
  BANK PLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ David Ewing

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  David Ewing

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Global Relationship Manager

  
									

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  BNP
  PARIBAS, AMSTERDAM 

  BRANCH

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ J.A.C. NIESSEN

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  J.A.C. NIESSEN

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  Head of Corp. Group

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  /s/ R. van der VELDEN

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  R. van der VELDEN

  
									

 

 

 

	
   

  	
   

  	
   

  	
   

  	
  COOPERATIEVE
  CENTRALE 

  RAIFFEISEN-

  BOERENLEEN BANK B.A.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ [ILLEGIBLE]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  [ILLEGIBLE]

  
	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
   

  
									

 

 

 

SCHEDULE 1.1(a)

 

AGREED SECURITY
PRINCIPLES

 

1.                          Agreed
Security Principles

 

1.1                    The Guarantees
and Liens to be provided by the Loan Parties will be given in accordance with
certain agreed security principles (the “Agreed Security Principles”).
This Schedule 1.1(a) identifies the Agreed Security Principles and addresses
the manner in which the Agreed Security Principles will impact on or be determinant
of the Guarantees and Liens to be taken in relation to this Agreement.

 

1.2                    The Agreed
Security Principles embody a recognition by all parties that there may be
certain legal, commercial and practical difficulties in obtaining effective
security from the Company and each of its Restricted Subsidiaries in every
jurisdiction in which the Company and its Restricted Subsidiaries are located.
In particular:

 

(a)                    general
statutory limitations, financial assistance, corporate benefit, fraudulent
preference, “thin capitalization” rules, retention of title claims and similar
matters may limit the ability of the Company or any of its Restricted
Subsidiaries to provide a Guarantee or Liens or may require that it be limited
as to amount or otherwise, and if so the same shall be limited accordingly, provided
that the Company or the relevant Restricted Subsidiary shall use reasonable
endeavors to overcome such obstacle. The Company will use reasonable endeavors
to assist in demonstrating that adequate corporate benefit accrues to each of
the Restricted Subsidiary;

 

(b)                   the Company and
its Restricted Subsidiaries will not be required to give Guarantees or enter
into Security Documents if (or to the extent) it is not within the legal
capacity of the Company or its relevant Restricted Subsidiary or if the same
would conflict with the fiduciary duties of their directors or contravene any
legal prohibition or regulatory condition or result in, or could reasonably be
expected to result in, a material risk of personal or criminal liability for
any officer or director of the Company or any of the Restricted Subsidiaries, provided
that the Company and each of its Restricted Subsidiaries shall use reasonable
endeavors to overcome any such obstacle;

 

(c)                    a key factor
in determining whether or not security shall be taken is the applicable cost
(including adverse effects on interest deductibility, registration taxes and
notarial costs) which shall not be disproportionate to the benefit to the
Lenders of obtaining such security;

 

(d)                   where there is
material incremental cost involved in creating security over all assets owned
by any of the Borrowers or a Guarantor in a particular category (e.g. real
estate), regard shall be had to the principle stated at paragraph 1.2(c) of
this Schedule 1.1 (a) which shall apply to the immaterial assets and, subject
to the Agreed Security Principles, only the material assets in that category
(e.g. real estate of material economic value) shall be subject to security;

 

 

 

(e)                    it is
expressly acknowledged that it may be either impossible or impractical to
create security over certain categories of assets in which event security will
not be taken over such assets;

 

(f)                      any assets
subject to contracts, leases, licenses or other arrangements with a third party
that exist concurrently (but which are not created in contemplation of the
Transactions) or are not prohibited by this Agreement and which (subject to
override by the UCC and other relevant provisions of applicable law),
effectively prevent those assets from being charged will be excluded from any
relevant Security Document; provided that reasonable endeavors to obtain
consent to creating Liens in any such assets shall be used by the Company and
each of its Restricted Subsidiaries to avoid or overcome such restrictions if
the Administrative Agent reasonably determines that the relevant asset is
material (which endeavors shall not include the payment of any consent fees),
but unless effectively prohibited by contracts, leases, licenses or other
arrangements with a third party that exist concurrently (but which are not
created in contemplation of the Transactions) or are not prohibited by this
Agreement, this shall not prevent security being given over any receipt or
recovery under such contract, lease or license;

 

(g)                   the giving of a
Guarantee, the granting of security or the perfection of the security granted
will not be required if it would have a material adverse effect (as reasonably
determined in good faith by management of the relevant obligor) on the ability
of the relevant obligor to conduct its operations and business in the ordinary
course as otherwise permitted by this Agreement;

 

(h)                   in the case of
accounts receivable, a material adverse effect on Holdings’, either
Co-Borrower’s or a Guarantor’s relationship with or sales to the customer
generating such receivables or material legal or commercial difficulties (as
reasonably determined by management of the relevant obligor in good faith) provided
that none of Holdings, the Borrowers and the Guarantors may utilize this
exception unless, after giving effect thereto no less than a majority of the
book value of the accounts receivable of the Company and its Subsidiaries on a
consolidated basis (as measured at the end of each fiscal quarter) is subject to
perfected liens, and provided further that any accounts receivable of
the Borrowers and the Guarantors excluded from collateral by virtue of this
clause (except where prohibited by law and subject to the remainder of these
Agreed Security Principles) shall be subject to perfected Liens promptly if and
when the corporate credit of the Company is downgraded to “B” or lower from
S&P and “B2” or lower from Moody’s;

 

(i)                       security
will be limited so that the aggregate of notarial costs and all registration
and like taxes relating to the provision of security shall not exceed an amount
to be agreed. Any additional costs may be paid by the Lenders at their option;
and

 

(k)                    all security
shall be given in favor of a single security trustee or collateral agent and
not the secured parties individually. “Parallel debt” provisions and other
similar structural options will be used where necessary and such provisions
will be contained in the intercreditor agreement and not the individual
security documents unless

 

 

 

required under
local law. No action will be required to be taken in relation to the guarantees
or security when any lender assigns or transfers any of its participation in
this Agreement to a new lender.

 

2.                          Terms
of Security Documents

 

The following principles will
be reflected in the terms of any Security Document to be executed and delivered
as part of the Transactions:

 

(a)                    subject to
permitted liens and these Agreed Security Principles the security will be first
ranking and the perfection of security (when required) and other legal
formalities will be completed as soon as practicable and, in any event, within
the time periods specified in the Credit Documents or, if earlier or to the
extent no such time period is specified in the Credit Documents, within the time
periods specified by applicable law in order to ensure due perfection;

 

(b)                   the security
will not be enforceable until an Event of Default has occurred and notice of
acceleration of the Loans has been given by the applicable Administrative Agent
or the Loans have otherwise become due and payable prior to the scheduled
maturity thereof (an “Enforcement Event”);

 

(c)                    prior to the
Maturity Date, notification of any Liens over bank accounts will be given
(subject to legal advice) to the banks with whom the accounts are maintained
only if an Enforcement Event has occurred;

 

(d)                   notification of
receivables security to debtors who are not members of the Company or its
Subsidiaries will only be given if an Enforcement Event has occurred;

 

(e)                    notification
of any security interest over insurance policies will be served on any insurer
of the Company’s or any Restricted Subsidiaries’ assets (other than in respect
of any insurance policy maintained by the Company or any of its Restricted
Subsidiaries which is due to expire on or before December 31, 2006);

 

(f)                      the Security
Documents should only operate to create security rather than to impose new
commercial obligations. Accordingly, they should not contain material
additional representations, undertakings or indemnities (such as in respect of
insurance, information or the payment of costs) unless these are the same as or
consistent with those contained in this Agreement or are necessary for the
creation or perfection of the security;

 

(g)                   in respect of
the share pledges and pledges of intra-group receivables, until an Enforcement
Event has occurred, the pledgors will be permitted to retain and to exercise
voting rights to any shares pledged by them in a manner which does not
materially adversely affect the value of the security (taken as a whole) or the
validity or enforceability of the security or cause an Event of Default to
occur, and the pledgors will be permitted to receive dividends on pledged
shares and payment of intra-group receivables and retain the proceeds and/or
make the proceeds available to Holdings and its Subsidiaries to the extent not
prohibited under this Agreement;

 

 

 

(h)                    Secured
Parties will only be able to exercise a power of attorney in any Security
Document following the occurrence of an Enforcement Event or with respect to
perfection or further assurance obligations that following request, the
relevant obligor has failed to satisfy;

 

(i)                        no obligor
shall be required to provide surveys on real property (unless such surveys
already exist in which case there shall be no requirement that such surveys be
certified to the Lenders) or to remove any encumbrances on title (not created
in contemplation of the Transactions) that are reflected in any title insurance
or any other existing encumbrances on real property (not created in
contemplation of the Transactions) (not including Liens securing Indebtedness
of the Company or any of its Restricted Subsidiaries);

 

(j)                        no obligor
shall be required to protect any Liens in the United States prior to the
occurrence of an Enforcement Event by means other than customary filings
(including UCC-1s, mortgage or deed of trust filings and patent and trademark
filings) and delivery of share certificates (accompanied by powers of attorney
executed in blank) and any intercompany promissory notes; and

 

(k)                     information,
such as lists of assets, will be provided if, and only to the extent, required
by local law to be provided to protect or create, perfect or register the
security and, to the extent so required will be provided annually (unless
required to be provided by local law more frequently, but not more frequently
than quarterly) and following the occurrence and during the continuance of an
Event of Default, on the applicable Administrative Agent’s reasonable request.

 

 

 

SCHEDULE 1.1(b)

 

COMMITMENTS

 

	
  Initial Lender

  	
   

  	
  Commitment

  	
   

  
	
  Merrill Lynch Capital Corporation

  	
   

  	
  €

  	
  73,333,333.33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Morgan Stanley Senior Funding, Inc.

  	
   

  	
  €

  	
  73,333,333.33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank AG, London Branch

  	
   

  	
  €

  	
  73,333,333.33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  €

  	
  40,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ABN AMRO Bank N.V.

  	
   

  	
  €

  	
  40,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mizuho Corporate Bank Limited

  	
   

  	
  €

  	
  40,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  HSBC Bank plc

  	
   

  	
  €

  	
  80,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas, Amsterdam Branch

  	
   

  	
  €

  	
  40,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cooperatieve Centrale Raiffeisen- Boerenleenbank
  B.A.

  	
   

  	
  €

  	
  40,000,000

  	
   

  

 

 

 

SCHEDULE 1.1(c )

 

FORM OF COMPLIANCE
CERTIFICATE

 

Financial
Statement Date:                   ,

 

To:                 Morgan Stanley
Senior Funding, Inc., as Administrative Agent

 

Ladies and
Gentlemen:

 

Reference is made to the
Secured Revolving Credit Agreement dated as of September 29, 2006 (the “Credit
Agreement”), among KASLION ACQUISITION B.V., NXP B.V. (the “Company”),
NXP FUNDING LLC, the lenders from time to time parties thereto (each a “Lender”
and, collectively, the “Lenders”). MORGAN STANLEY SENIOR FUNDING, INC.,
as Administrative Agent and Global Collateral Agent, MORGAN STANLEY BANK
INTERNATIONAL LIMITED, DEUTSCHE BANK AG, LONDON BRANCH and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED, as Joint Lead Arrangers and Joint Bookrunners,
DEUTSCHE BANK AG, LONDON BRANCH, as Syndication Agent and MERRILL LYNCH CAPITAL
CORPORATION, as Documentation Agent. All capitalized terms used but not defined
herein shall have the meanings given in the Credit Agreement.

 

This is a Compliance Certificate
for the purposes of the Credit Agreement.

 

The undersigned
hereby certifies as of the date hereof that he/she is the [Title](1)
 of the Company, and that, as
such, he/she is authorized to execute and deliver this Compliance Certificate
to the Administrative Agent on the behalf of the Company, and that:

 

[Use following paragraph 1 for
fiscal year-end financial
statements]

 

1.                          Attached
hereto as Schedule 1 are the year-end audited financial statements
required by Section 9.01(a) of the Credit Agreement for the fiscal year
of the Company ended as of the above date, together with the report and opinion
of [                                
] required by and in conformance with such section.

 

[Use following paragraph 1 for
fiscal quarter-end financial statements]

 

2.                          Except
as otherwise permitted by the Credit Agreement, attached hereto as Schedule
1 are the unaudited financial statements required by Section 9.01(b)
of the Credit Agreement for the fiscal quarter of the Company ended as of the
above date. Such financial statements fairly present, in all material respects,
the financial condition, results of operations shareholders’ equity and cash
flows of the Company and its Subsidiaries in accordance with GAAP as at such
date and for such period, subject only to normal year-end audit adjustments and
the absence of footnotes.

 

(1) Must be the
chief executive officer, chief financial officer, treasurer or controller of
the Company.

 

 

 

3.                          The
undersigned has reviewed and is familiar with the terms of the Credit Agreement
and has made, or has caused to be made under his/her supervision, a detailed
review of the transactions and condition (financial or otherwise) of the
Company and its Subsidiaries during the accounting period covered by the
attached financial statements.

 

IN WITNESS
WHEREOF, the undersigned has executed this Compliance Certificate as of                            ].

 

	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

 

SCHEDULE l.1(d)

 

MANDATORY COSTS

 

1.                          The
Mandatory Cost is an addition to the interest rate to compensate Lenders for
the cost of compliance with (a) the requirements of the Bank of England and/or
the Financial Services Authority (or, in either case, any other authority which
replaces all or any of its functions) or (b) the requirements of the European
Central Bank.

 

2.                          On the
first day of each Interest Period (or as soon as possible thereafter) the
Administrative Agent shall calculate, as a percentage rate, a rate (the “Additional
Cost Rate”) for each Lender, in accordance with the paragraphs set out
below. The Mandatory Cost will be calculated by the Administrative Agent as a
weighted average of the Lenders’ Additional Cost Rates (weighted in proportion
to the percentage participation of each Lender in the relevant Loan) and will
be expressed as a percentage rate per annum.

 

3.                          The
Additional Cost Rate for any Lender lending from a Facility Office in a
Participating Member State will be the percentage notified by that Lender to
the Administrative Agent. This percentage will be certified by that Lender in
its notice to the Administrative Agent to be its reasonable determination of
the cost (expressed as a percentage of that Lender’s participation in all Loans
made from that Facility Office) of complying with the minimum reserve
requirements of the European Central Bank in respect of loans made from that
Facility Office.

 

4.                          The
Additional Cost Rate for any Lender lending from a Facility Office in the
United Kingdom will be calculated by the Administrative Agent as follows:

 

(a)                    in relation to
a sterling Loan:

 

	
  AB+C(B—D)+Ex0.01

  	
   

  	
  per cent. per annum 

  
	
  100— (A+C)

  	
   

  

 

(b)                   in relation to
a Loan in any currency other than sterling:

 

	
  E
  x 0.01

  	
   

  	
  per cent. per annum 

  
	
  300

  	
   

  

 

Where:

 

A                         is the
percentage of Eligible Liabilities (assuming these to be in excess of any
stated minimum) which that Lender is from time to time required to maintain as
an interest free cash ratio deposit with the Bank of England to comply with
cash ratio requirements.

 

B                           is the
percentage rate of interest (excluding the Applicable LIBOR Margin or the
Applicable EURIBOR Margin (as the case may be) and the Mandatory Cost and any
additional rate of interest charged on overdue amounts pursuant to Section Error! Reference source not found.) payable
for the relevant Interest Period on the Loan.

 

C                           is the
percentage (if any) of Eligible Liabilities which that Lender is required from
time to time to maintain as interest bearing Special Deposits with the Bank of
England.

 

D                          is the
percentage rate per annum payable by the Bank of England to the Administrative
Agent on interest bearing Special Deposits.

 

E                            is
designed to compensate Lenders for amounts payable under the Fees Rules and is
calculated by the Administrative Agent as being the average of the most recent
rates of

 

 

 

charge supplied by the
Reference Banks to the Administrative Agent pursuant to paragraph 7 below and
expressed in pounds per £1,000,000.

 

5.                          For the
purposes of this Schedule:

 

(a)                    “Eligible
Liabilities” and “Special Deposits” have the meanings given to them
from time to time under or pursuant to the Bank of England Act 1998 or (as may
be appropriate) by the Bank of England;

 

(b)                   “Facility
Office” means, in respect of any Lender, the jurisdiction of the office out
of which such Lender is making available its participation in the relevant
Loan;

 

(c)                    “Fees Rules”
means the rules on periodic fees contained in the FSA Supervision Manual or
such other law or regulation as may be in force from time to time in respect of
the payment of fees for the acceptance of deposits;

 

(d)                   “Fee Tariffs”
means the fee tariffs specified in the Fees Rules under the activity group A.1
Deposit acceptors (ignoring any minimum fee or zero rated fee required pursuant
to the Fees Rules but taking into account any applicable discount rate); and

 

(e)                    “Tariff Base”
has the meaning given to it in, and will be calculated in accordance with, the
Fees Rules.

 

6.                          In
application of the above formulae, A, B, C and D will be included in the
formulae as percentages (i.e. 5 per cent. will be included in the formula as 5
and not as 0.05). A negative result obtained by subtracting D from B shall be
taken as zero. The resulting figures shall be rounded to four decimal places.

 

7.                          If
requested by the Administrative Agent, each Reference Bank shall, as soon as
practicable after publication by the Financial Services Authority, supply to
the Administrative Agent, the rate of charge payable by that Reference Bank to
the Financial Services Authority pursuant to the Fees Rules in respect of the
relevant financial year of the Financial Services Authority (calculated for
this purpose by that Reference Bank as being the average of the Fee Tariffs
applicable to that Reference Bank for that financial year) and expressed in
pounds per £1,000,000 of the Tariff Base of that Reference Bank.

 

8.                          Each
Lender shall supply any information required by the Administrative Agent for
the purpose of calculating its Additional Cost Rate. In particular, but without
limitation, each Lender shall supply the following information on or prior to
the date on which it becomes a Lender:

 

(a)                    the
jurisdiction of its Facility Office; and

 

(b)                   any other
information that the Administrative Agent may reasonably require for such
purpose.

 

Each Lender shall
promptly notify the Administrative Agent of any change to the information
provided by it pursuant to this paragraph.

 

9.                          The
percentages of each Lender for the purpose of A and C above and the rates of
charge of each Reference Bank for the purpose of E above shall be determined by
the Administrative Agent based upon the information supplied to it pursuant to
paragraphs 7 and 8 above and on the assumption that, unless a Lender notifies
the Administrative

 

 

 

Agent to the
contrary, each Lender’s obligations in relation to cash ratio deposits and
Special Deposits are the same as those of a typical bank from its jurisdiction
of incorporation with a Facility Office in the same jurisdiction as its
Facility Office.

 

10.                    The
Administrative Agent shall have no liability to any person if such
determination results in an Additional Cost Rate which over or under
compensates any Lender and shall be entitled to assume that the information
provided by any Lender or Reference Bank pursuant to paragraphs 3, 7 and 8
above is true and correct in all respects.

 

11.                    The
Administrative Agent shall distribute the additional amounts received as a
result of the Mandatory Cost to the Lenders on the basis of the Additional Cost
Rate for each Lender based on the information provided by each Lender and each
Reference Bank pursuant to paragraphs 3, 7 and 8 above.

 

12.                    Any
determination by the Administrative Agent pursuant to this Schedule in relation
to a formula, the Mandatory Cost, an Additional Cost Rate or any amount payable
to a Lender shall, in the absence of manifest error, be conclusive and binding
on all parties hereto.

 

13.                    The
Administrative Agent may from time to time, after consultation with the Company
and the Lenders, determine and notify to all parties any amendments which are
required to be made to this Schedule in order to comply with any change in law,
regulation or any requirements from time to time imposed by the Bank of
England, the Financial Services Authority or the European Central Bank (or, in
any case, any other authority which replaces all or any of its functions) and
any such determination shall, in the absence of manifest error, be conclusive
and binding on all parties.

 

 

 

SCHEDULE 1.1(e)

 

SECURITY DOCUMENTS

 

1.                          FRANCE

 

(a)                    Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee, in relation to the shares in Philips Semiconductors France SAS.

 

(b)                   Intercompany
Debt Pledge Agreement between NXP B.V. and Morgan Stanley Senior Funding, Inc.,
as Global Collateral Agent.

 

(c)                    IP Security
Agreement between NXP B.V. and Morgan Stanley Senior Funding, Inc., as Global
Collateral Agent, relating to intellectual property in France.

 

(d)                   Pledge of
Shares between Philips Semiconductors France SAS, as pledgor, and Morgan
Stanley Senior Funding, Inc., as pledgee, in relation to the shares in Crolles.

 

(e)                    Pledge of
Trade Receivables between Philips Semiconductors France SAS, as pledgor, and
Morgan Stanley Senior Funding, Inc., as pledgee.

 

(f)                      Pledge of
Business as an Ongoing Concern between Philips Semiconductors France SAS, as
pledgor, and Morgan Stanley Senior Funding, Inc., as pledgee.

 

2.                          GERMANY

 

(a)                    Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee, in relation to the shares in Philips Semiconductors Germany GmbH.

 

(b)                   Pledge of
Shares between Philips Semiconductors Germany GmbH, as pledgor, and Morgan
Stanley Senior Funding, Inc., as pledgee, in relation to the shares in Philips
Semiconductors Dresden AG.

 

(c)                    Land Charge
Deeds between Philips Semiconductors Germany GmbH and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

(d)                   Security
Transfer of Moveable Assets between Philips Semiconductors Germany GmbH and
Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

(e)                    Global
Assignment of Receivables between Philips Semiconductors Germany GmbH and
Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

(f)                      IP Security
Agreement between NXP B.V. and Morgan Stanley Senior Funding, Inc., as Global
Collateral Agent, relating to intellectual property in Germany.

 

3.                          HONG
KONG

 

(a)                    Share and
Receivables Charge over the shares and receivables in Philips Semiconductors
Hong Kong Limited between NXP B.V. and Morgan Stanley Senior Funding, Inc., as
Global Collateral Agent.

 

 

 

(b)                   Debenture
between Philips Semiconductors Hong Kong Limited and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

4.                          NETHERLANDS

 

(a)                    Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee, in relation to the shares in Philips Semiconductors B.V.

 

(b)                   Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee, in relation to the shares in Philips Software B.V.

 

(c)                    Pledge of
Shares between KASLION Acquisition B.V., as. pledgor, and Morgan Stanley Senior
Funding, Inc., as pledgee, in relation to the shares in NXP B.V.

 

(d)                   Disclosed
Pledge of Insurance Receivables between NXP B.V. and Philips Semiconductors
B.V., as pledgors, and Morgan Stanley Senior Funding, Inc., as pledgee.

 

(e)                    Disclosed
Pledge of Intercompany Receivables between KASLION Acquisition B.V., NXP B.V.
and Philips Semiconductors B.V., as pledgors, and Morgan Stanley Senior
Funding, Inc., as pledgee.

 

(f)                      Undisclosed
Pledge of Third Party Receivables between NXP B.V. and Philips Semiconductors
B.V., as pledgors, and Morgan Stanley Senior Funding, Inc., as pledgee.

 

(g)                   Non-Possessory
Pledge of Moveable Assets between KASLION Acquisition B.V., NXP B.V. and
Philips Semiconductors B.V., as pledgors, and Morgan Stanley Senior Funding,
Inc., as pledgee.

 

(h)                   Pledge of IP
Rights between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee.

 

(i)                       Deed of
Mortgage between Philips Semiconductors B.V. and Morgan Stanley Senior Funding,
Inc., as Global Collateral Agent.

 

5.                          PHILIPPINES

 

(a)                    Deed of
Conditional Assignment to be entered into among Philips Semiconductors
Philippines, Inc. and NXP B.V., as Assignors, and Hong Kong Shanghai Banking
Corporation, Philippine Branch, as Assignee and Escrow Agent.

 

6.                          SINGAPORE

 

(a)                    Charge over
the shares in Philips Semiconductors Singapore Pte. Ltd. between NXP B.V. and
Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

(b)                   Charge over the
shares in Systems On Silicon Manufacturing Company Pte Ltd. between NXP B.V.
and Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

(c)                    Debenture
between Philips Semiconductors Singapore Pte. Ltd. and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

 

 

7.                          TAIWAN

 

(a)                    Mortgage over
the shares in Philips Electronics Building Elements Industries (Taiwan) Ltd. to
be entered into between Mizuho Corporate Bank, Ltd., as Taiwan Collateral
Agent, and NXP B.V.

 

(b)                   Mortgage of
land and buildings to be entered into between Mizuho Corporate Bank, Ltd., as
Taiwan Collateral Agent, and Philips Electronics Building Elements Industries
(Taiwan) Ltd.

 

(c)                    Mortgage of
equipment to be entered into between Mizuho Corporate Bank, Ltd., as Taiwan
Collateral Agent, and Philips Electronics Building Elements Industries (Taiwan)
Ltd.

 

(d)                   Assignment of
accounts receivable to be entered into between Mizuho Corporate Bank, Ltd., as
Taiwan Collateral Agent, and Electronics Building Elements Industries (Taiwan)
Ltd.

 

8.                          THAILAND

 

(a)                    Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee, in relation to the shares in Philips Semiconductors (Thailand) Co.
Ltd.

 

(b)                   Assignment of
Receivables from material contracts and insurances between Philips
Semiconductors (Thailand) Co. Ltd. and Morgan Stanley Senior Funding, Inc., as
Global Collateral Agent.

 

(c)                    Mortgage of
Real Property between Philips Semiconductors (Thailand) Co. Ltd. and Morgan
Stanley Senior Funding, Inc., as Global Collateral Agent.

 

(d)                   Mortgage of
Machinery between Philips Semiconductors (Thailand) Co. Ltd. and Morgan Stanley
Senior Funding, Inc., as Global Collateral Agent.

 

9.                          UNITED
KINGDOM

 

(a)                    Debenture
between NXP B.V. and Morgan Stanley Senior Funding, Inc., as Global Collateral
Agent, in relation to security over shares, receivables, intellectual property
rights and certain bank accounts.

 

(b)                   Debenture
between Philips Semiconductors UK Limited and Morgan Stanley Senior Funding,
Inc., as Global Collateral Agent.

 

(c)                    Charge over
intercompany receivables between Philips Semiconductors (Thailand) Co. Ltd. and
Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

10.                    UNITED STATES

 

(a)                    Security
Agreement among Philips Semiconductors USA Inc., NXP Funding LLC, and Morgan
Stanley Senior Funding, Inc., as Global Collateral Agent.

 

 

 

(b)                   Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee in relation to the shares in Philips Semiconductors USA Inc.

 

(c)                    Deed of Trust
between Philips Semiconductors USA Inc. and Morgan Stanley Senior Funding,
Inc., as Global Collateral Agent.

 

(d)                   Leasehold
Mortgage between Philips Semiconductors USA Inc. and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

(e)                    IP Security
Agreement between NXP B.V. and Morgan Stanley Senior Funding, Inc., as Global
Collateral Agent, relating to intellectual property in the United States and
any short form version thereof to be filed with any relevant governmental
authorities.

 

(f)                      Pledge of
Shares between NXP B.V., as pledgor, and Morgan Stanley Senior Funding, Inc.,
as pledgee in relation to the shares in non-Guarantor subsidiaries.

 

 

 

SCHEDULE 6.12

 

POST CLOSING MATTERS

 

This Schedule sets forth
those Security Documents and Guarantees that shall not constitute conditions
precedent to the initial Credit Event under the Agreement but shall be required
to be delivered in accordance with the final paragraph of Section 6, subject in
each case to the Agreed Security Principles.

 

1.                          GERMANY

 

(a)                    Land Charge
Deeds between Philips Semiconductors Germany GmbH and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

(b)                   IP Security
Agreement between NXP B.V. and Morgan Stanley Senior Funding, Inc., as Global
Collateral Agent, relating to intellectual property in Germany.

 

2.                          JAPAN

 

(a)                    Security over
intellectual property registered in Japan between NXP B.V. and Morgan Stanley
Senior Funding, Inc., as Global Collateral Agent.

 

3.                          SINGAPORE

 

(a)                    Charge over
the shares in Systems On Silicon Manufacturing Company Pte Ltd. between NXP
B.V. and Morgan Stanley Senior Funding, Inc., as Global Collateral Agent.

 

4.                          TAIWAN

 

(a)                    Mortgage of
land and buildings to be entered into between Mizuho Corporate Bank, Ltd., as
Taiwan Collateral Agent, and Philips Electronics Building Elements Industries
(Taiwan) Ltd.

 

(b)                   Mortgage of
equipment to be entered into between Mizuho Corporate Bank, Ltd., as Taiwan
Collateral Agent, and Philips Electronics Building Elements Industries (Taiwan)
Ltd.

 

5.                          THAILAND

 

(a)                    Supplement in
relation to the Guaranty.

 

(b)                   Mortgage of
Real Property between Philips Semiconductors (Thailand) Co. Ltd. and Morgan
Stanley Senior Funding, Inc., as Global Collateral Agent in relation to the
land represented by title deeds Nos. 1432, 1902, 1904, 8365, 8366, 8367, 8368,
8369 and

 

 

 

8370, Land Nos. 2419, 35,
10, 1050, 1051, 1052, 1053, 1054 and 1055, Survey Page Nos. 104, 23, 162, 1334,
1335, 1336, 1337, 1338 and 1339 located at Talard Bang Khen Sub-District, Bang
Khen District, Bangkok Metropolis, including any building from time to time
constructed thereon, and registration thereof.

 

(c)                    Mortgage of
Machinery between Philips Semiconductors (Thailand) Co. Ltd. and Morgan Stanley
Senior Funding, Inc., as Global Collateral Agent and registration thereof.

 

(d)                   Approval in
principle from the Bank of Thailand in connection with the conversion and
remittance from Thailand of amounts that may become due and payable by Philips
Semiconductors (Thailand) Co., Ltd. under the Guaranty.

 

6.                          UNITED
KINGDOM

 

(a)                    Supplement in
relation to the Guaranty.

 

(b)                   Debenture
between Philips Semiconductors UK Limited and Morgan Stanley Senior Funding,
Inc., as Global Collateral Agent.

 

7.                          UNITED
STATES

 

(a)                    Deed of Trust
between Philips Semiconductors USA Inc. and Morgan Stanley Senior Funding,
Inc., as Global Collateral Agent.

 

(b)                   Leasehold
Mortgage between Philips Semiconductors USA Inc. and Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent.

 

 

 

SCHEDULE 8.10

 

LITIGATION (EXCEPT
INTELLECTUAL PROPERTY LITIGATION)

 

NETHERLANDS/CENTRAL

 

A.                      Major European Customer

 

•                            On May
9, 2005, one of our significant European customers filed a request for
arbitration with the ICC International Court of Arbitration in relation to a
product warranty claim that arose in March 2002 over the reliability of certain
of our integrated circuit products that were delivered between 1999 and 2002
and were used by the customer in its products. The claims relate to a molding
compound supplied to us by Sumitomo Bakelite Company of Japan (“Sumitomo”)
during that period. It is the customer’s current view that over time all
affected products supplied by us will fail and, as a result, the customer
anticipates very large damages, which it claims from us in the arbitration. We
believe that the defect rate will be substantially smaller than anticipated by
the customer and dispute our liability on that basis, as well as on the basis
of the limited warranty provision the customer has invoked. We also believe
that, even if the customer were to be successful in the arbitration, we would
not be liable to the extent of the damages claimed by the customer. We intend
to defend the case vigorously. Moreover, on May 10, 2006, we filed a request
for arbitration with the ICC International Court of Arbitration to recover from
Sumitomo any amount that we become liable to pay to the customer. In addition,
Philips has agreed to indemnify us with respect to any damages or losses we may
sustain in relation to this arbitration and accordingly do not expect this case
to have a material adverse effect on our results or financial condition.

 

 

 

 

 

SCHEDULE 8.13

 

ENVIRONMENTAL CLAIMS

 

All information
contained in the documents provided at the Virtual Data Room (as defined in the
Acquisition Agreement) locations listed below is expressly incorporated in this
Section 8.13.

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations /

  Additional Information

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  China

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Guangdong

  	
   

  	
  •        Environmental Impact Assessment increased
  production volume and waste water treatment

  	
   

  	
  EUR 60,000

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0010 — Guangdong China Environmental
  Assessment

  
	
   

  	
   

  	
  •        Minor improvements

  	
   

  	
  EUR 25,000

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  France

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Caen

  	
   

  	
  •        Soil and groundwater pollution

  	
   

  	
  EUR 3 million

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0007 — Caen
  France Environmental Assessment

  
	
   

  	
   

  	
  •        Asbestos in buildings

  	
   

  	
  EUR 260,000

  	
   

  	
  •                             J01-04-PD-0002 — Caen
  Final ACM

  •                             J01-04-PD-0003 — Caen
  Table 1 ACM removal cost

  
	
   

  	
   

  	
  •        USTs and ASTs (Storage Tanks)

  	
   

  	
  EUR 60,000

  	
   

  	
  •                             J01-04-PD-0005 — Caen
  Appendix build WaterWork

  •                             J01-04-PD-0006 — Caen
  Appendix build Y

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  EUR 30,000

  	
   

  	
  •                             J01-04-PD-0007 — Caen
  Appendix build B-C

  
	
   

  	
   

  	
  •        Storm water

  	
   

  	
   

  	
   

  	
  •                             J01-04-PD-0008 — Caen
  Appendix G

  •                             J01-04-PD-0009 — Caen
  Appendix build Hprime

  •                             J01-04-PD-0010 —
  Appendix build J

  •                             J01-04-PD-0011 — Caen
  Appendix build Lprirme

  

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations /

  Additional Information

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  •                             J01-04-PD-0012
  — Appendix build N-R

  •                             J01-04-PD-0013
  — Caen Appendix build N-R GF

  •                             J01-04-PD-0014-Appendix
  build Pprime

  •                             J01-04-PD-0078
  — Caen R6014278 edr V01 annexe 1a

  •                             J01-04-PD-0079
  — R6014278 edr V01 annexe 1b

  •                             J01-04-PD-0080
  — R6014278 evaluation risques.V01

  •                             J01-04-PD-0081 — R6014294 ESR
  phase 1

  •                             J01-03-PD-0002
  — Summary Environmental Assessment

  •                             J01-04-PD-0082
  — R6014294 ESR phase 1 Annexe 1

  •                             J01-04-PD-0083
  — R6014294 ESR phase 1 Annexe 6

  •                             J01-04-PD-0084
  — R6014294 ESR phase 1 Annexe 7

  •                             J01-04-PD-0085
  — R6014294 ESR phase 1 Annexe 8

  •                             J01-04-PD-0093
  — Rapport ICF-05-INV-185-Investigations CORIO

  •                             J01-04-PD-0094
  — Resume concentration-metaux-A3

  •                             J01-04-PD-0095
  — Resume concentration- solvants A3

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Germany

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hamburg

  	
   

  	
  Soil and groundwater
  pollution

  	
   

  	
  EUR 16 million

  	
   

  	
  •                             J01-03-PD-0002
  — Summary Environmental Assessment

  •                             J01-03-PD-0011
  — Hamburg Germany Environmental Assessment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Netherlands

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Nijmegen

  	
   

  	
  •        Soil and groundwater pollution

  	
   

  	
  EUR 2.5 million

  	
   

  	
  •                             J01-03-PD-0002
  — Summary Environmental Assessment

  •                             J01-03-PD-0016
  — Nijmegen Netherlands Environmental

  
										

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations /

  Additional Information

  
	
   

  	
   

  	
  •        Environmental licenses required

  	
   

  	
  EUR 500,000

  	
   

  	
  Assessment

  •                             J01-04-PD-0097 —
  Nijmegen fase 3 rapport 1998

  •                             J01-04-PD-0098 — Nijmegen
  bijlagen fase 3 rapport 1998

  
	
   

  	
   

  	
  •        Asbestos in foundation parking lot

  	
   

  	
  EUR 175,000

  	
   

  	
  •                             J01-04-PD-0099
  — Definiitief Bodemrisicoanalyse

  •                             J01-04-PD-0100
  — Nijmegen 2 NRB rapport

  •                             J01-04-PD-0101
  — Nijmegen GW-resultaat

  •                             J01-04-PD-0102
  — Nijmegen updated map 2006

  
	
  Lent 

  	
   

  	
  Soil and groundwater
  pollution 

   

  This matter involves
  premises at Pastoor van Laakstraat 90-92, Lent. Philips owned and occupied
  this site until selling it to C.C.A. BV on December 31, 1984. Under the sale
  agreement, Philips retained liability for soil and groundwater pollution. Ownership
  of site has changed hands several times since then; it is currently owned by
  the Municipality of Nijmegen, which purchased it in 1995.

   

  The Stichting
  Bodemsanering NS (SBNS) has indicated that it

  	
   

  	
  0 (but maximum
  potential liability of EUR 6 million) 

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations/
 Additional Information

  
	
   

  	
   

  	
  will
  hold Philips liable for all damages that NS Vastgoed and/or Prorail, who are
  developing the property, may suffer as a result of soil and groundwater
  contamination on the premises caused by Philips. Philips has denied liability
  on the grounds that SBNS has not established that the soil and groundwater
  contamination was caused by Philips. It is considered very unlikely that a
  claim against Philips in connection with this matter will be made
  successfully.

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Philippines

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pamplona

  	
   

  	
  Soil
  and groundwater pollution

  	
   

  	
  EUR
  700,000

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-04-PD-0075 — Las
  Pinas CAP final

  •                             J01-04-PD-0076 — Las Pinas
  reassessment

  
	
  Calamba

  	
   

  	
  Pollution

  	
   

  	
  EUR
  100,000

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0008 — Calamba
  Philippines Environmental Assessment

  •                             J01-04-PD-0053 —
  Philippines

  

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations/
 Additional Information

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Calamba part 1

  •                             J01-04-PD-0054 —
  Philippines Calamba part 2

  
	
  Cabayuao

  	
   

  	
  Improvements
  and permits required

  	
   

  	
  EUR
  25,000

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0006 — Cabuyo
  Philippines Environmental Assessment J01-04-PD-0049 — Philippines Cabuyo part
  1

  •                             J01-04-PD-0050 —
  Philippines Cabuyo part 2

  •                             J01-04-PD-0051 — Philippines
  Cabuyo part 3

  •                             J01-04-PD-0052 —
  Philippines Cabuyo part 4

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Singapore

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SSMC

  	
   

  	
  Oil
  spill

  	
   

  	
  EUR
  30,000

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0019 —
  Singapore SSMC Environmental Assessment

  •                             J01-04-PD-0030 —
  Singapore SSMC

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  United Kingdom

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Southampton

  	
   

  	
  Asbestos in buildings

  	
   

  	
  EUR 800,000

  	
   

  	
  •                             J01-03-PD-0002
  — Summary Environmental Assessment

  •                             J01-03-PD-0022
  — Southampton UK Environmental Assessment

  •                             J01-04-PD-0034
  — Southampton Final

  •                             J01-04-PD-0035
  —Southampton Tables Southampton

  •                             J01-04-PD-0036
  — Southampton Fig 1 Site Location

  •                             J01-04-PD-0037
  — Southampton Fig2 Site Layout and borehole Locations

  •                             J01-04-PD-0038
  —

  

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations/
 Additional Information

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Southampton Fig3
  groundwater elevations

  •                             J01-04-PD-0039 —
  Southampton Fig4 Tier I exceedances

  •                             J01-04-PD-0040 —
  Southampton Appendix A Borehole logs

  •                             J01-04-PD-0041 —
  Southampton Appendix B Laboratory certificates

  •                             J01-04-PD-0043 —
  Southampton Asbestos Final

  •                             J01-04-PD-0044 —
  Southampton Site Location

  •                             J01-04-PD-0045 —
  Southampton Site Layout

  •                             J01-04-PD-0046 —
  Southampton Risk Assessment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hazel
  Grove

  	
   

  	
  Asbestos
  in building and foundation

   

  Possible
  soil and groundwater pollution

  	
   

  	
  EUR
  800,000

   

  Unknown

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  •                             J01-03-PD-0012 — Hong kong
  PSCCHK Environmental Assessment

  •                             J01-04-PD-0031 — Hazel
  Grove Asbestos Survey

  •                             J01-04-PD-0032 — Hazel
  Grove Location Map

  •                             J01-04-PD-0033 — Hazel
  Grove Layout Plan

  •                             J01-04-PD-0057 — UK
  Hazel Grove Final report Stockport

  •                             J01-04-PD-005 8 — UK
  Hazel Grove Tables 1 to 13

  •                             J01-04-PD-0059 — UK
  Hazel Grove Figure 1 Site Location

  •                             J01-04-PD-0060 — UK
  Hazel Grove Figure 2 Site Layout

  •                             J01-04-PD-0061 — UK
  Hazel Grove Figure 3 Shallow Groundwater Levels

  •                             J01-04-PD-0062 — UK Hazel
  Grove Appendix A Borehole Log Records

  •                             J01-04-PD-0063,
  J01-04-PD-0064 — UK Hazel Grove Appendix C Analytical certificates1

  

 

 

 

	
  Site

  	
   

  	
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  Virtual Data Room Locations / Additional Information

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  •                             J01-04-PD-0065 — UK
  Hazel Grove Appendix C Analytical certificates2 xxx

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  United
  States

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sunnyvale

  	
   

  	
  Soil and groundwater
  pollution

   

  This matter concerns
  soil and/or groundwater pollution at six sites in Sunnyvale, California: (1) 

  811E. Arques;

  (2) 440 Wolfe; (3) 740 Kifer;

  (4) 760 Evelyn;

  (5) 680 Maude; and 

  (6) 915 De Guigne. None of the locations are currently used by Philips.
  Remediation activities are being performed at each of these sites at a total
  cost of approximately 

  USD 1.1 million per year and are expected to continue for some time into the
  future.

  	
   

  	
  USD 13.6 million.
  Liability for clean-up will remain with Philips following the Transaction.

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Albuquerque

  	
   

  	
  Facility cleanup and
  removal of remaining hazardous materials (if any) prior to sale

  	
   

  	
  USD 2.5 million

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  

 

 

 

	
  Site

  	
   

  	
  Issue

  	
   

  	
  Expected Liability

  	
   

  	
  Virtual Data Room Locations / Additional Information

  
	
  San Antonio

  	
   

  	
  Potential improper closure
  of chemical tank

  	
   

  	
  Uncertain

  	
   

  	
  •                             J01-03-PD-0002 — Summary
  Environmental Assessment

  

 

 

 

SCHEDULE 8.15

 

SUBSIDIARIES

 

	
  No.

  	
   

  	
  Subsidiary

  	
   

  	
  Jurisdiction of Organization

  	
   

  	
  Ownership

  Interest

  
	
  1.

  	
   

  	
  Philips Semiconductors B.V.

  	
   

  	
  Netherlands

  	
   

  	
  100%

  
	
  2.

  	
   

  	
  Philips Software B.V.

  	
   

  	
  Netherlands

  	
   

  	
  100%

  
	
  3.

  	
   

  	
  Philips Semiconductors Dresden AG

  	
   

  	
  Germany

  	
   

  	
  100%

  
	
  4.

  	
   

  	
  SMST UK GmbH (Unterstutzungs Kasse)

  	
   

  	
  Germany

  	
   

  	
  100%

  
	
  5.

  	
   

  	
  Philips Semiconductors Germany GmbH

  	
   

  	
  Germany

  	
   

  	
  100%

  
	
  6.

  	
   

  	
  Philips Semiconductors Austria GmbH

  	
   

  	
  Austria

  	
   

  	
  100%

  
	
  7.

  	
   

  	
  Philips Semiconductors Switzerland AG

  	
   

  	
  Switzerland

  	
   

  	
  100%

  
	
  8.

  	
   

  	
  Philips Semiconductors Belgium N.V.

  	
   

  	
  Belgium

  	
   

  	
  100%

  
	
  9.

  	
   

  	
  Philips Semiconductors Crolles R&D SAS

  	
   

  	
  France

  	
   

  	
  100%

  
	
  10.

  	
   

  	
  Philips Semiconductors France SAS

  	
   

  	
  France

  	
   

  	
  100%

  
	
  11.

  	
   

  	
  Philips Semiconductors Italy SpA

  	
   

  	
  Italy

  	
   

  	
  100%

  
	
  12.

  	
   

  	
  Philips Semiconductors Finland Oy

  	
   

  	
  Finland

  	
   

  	
  100%

  
	
  13.

  	
   

  	
  Philips Semiconductors Sweden AB

  	
   

  	
  Sweden

  	
   

  	
  100%

  
	
  14.

  	
   

  	
  Philips Semiconductors UK Limited

  	
   

  	
  UK

  	
   

  	
  100%

  
	
  15.

  	
   

  	
  Philips Semiconductors Hungary Ltd

  	
   

  	
  Hungary

  	
   

  	
  100%

  
	
  16.

  	
   

  	
  Philips Semiconductors Electronic Ticaret A.S

  	
   

  	
  Turkey

  	
   

  	
  100%

  
	
  17.

  	
   

  	
  Philips Semiconductors Poland Sp. z.o.o

  	
   

  	
  Poland

  	
   

  	
  100%

  
	
  18.

  	
   

  	
  Philips Semiconductors Russia O.O.O.(1)

  	
   

  	
  Russia

  	
   

  	
  100%

  
	
  19.

  	
   

  	
  Philips Semiconductors (Guangdong) Company Ltd

  	
   

  	
  China

  	
   

  	
  100%

  
	
  20.

  	
   

  	
  Philips Electronics (Beijing) Co. Ltd

  	
   

  	
  China

  	
   

  	
  100%

  
	
  21.

  	
   

  	
  Philips Semiconductors (Suzhou) Co. Ltd

  	
   

  	
  China

  	
   

  	
  100%

  
	
  22.

  	
   

  	
  Philips Jilin Semiconductors Co Ltd

  	
   

  	
  China

  	
   

  	
  60%

  
	
  23.

  	
   

  	
  Philips Semiconductors (Shanghai) Company Ltd

  	
   

  	
  China

  	
   

  	
  100%

  
	
  24.

  	
   

  	
  Philips Semiconductors HK Limited

  	
   

  	
  Hong Kong

  	
   

  	
  100%

  
	
  25.

  	
   

  	
  Philips Semiconductors Japan, Ltd

  	
   

  	
  Japan

  	
   

  	
  100%

  
	
  26.

  	
   

  	
  Philips Semiconductors Korea Ltd.

  	
   

  	
  Korea

  	
   

  	
  100%

  
	
  27.

  	
   

  	
  Philips Semiconductors Singapore Pte. Ltd

  	
   

  	
  Singapore

  	
   

  	
  100%

  
	
  28.

  	
   

  	
  P.T. RFS Batam

  	
   

  	
  Indonesia

  	
   

  	
  100%

  
	
  29.

  	
   

  	
  Philips Electronics Building Elements Industries
  (Taiwan) Ltd

  	
   

  	
  Taiwan

  	
   

  	
  100%

  
	
  30.

  	
   

  	
  Philips Semiconductors Seremban Sdn Berhad

  	
   

  	
  Malaysia

  	
   

  	
  100%

  

 

	
   

  	
   

  	
  (1) To be incorporated.

  	
   

  	
   

  	
   

  	
   

  

 

 

 

	
  31.

  	
   

  	
  Philips Semiconductors Philippines Inc

  	
   

  	
  Philippines

  	
   

  	
  100%

  
	
  32.

  	
   

  	
  Laguna Ventures Philippines Inc.

  	
   

  	
  Philippines

  	
   

  	
  39.99%

  
	
  33.

  	
   

  	
  Philips Semiconductors (Thailand) Co. Ltd

  	
   

  	
  Thailand

  	
   

  	
  99.99%

  
	
  34.

  	
   

  	
  Philips Semiconductors SMO (Thailand) Co. Ltd.

  	
   

  	
  Thailand

  	
   

  	
  99.99%

  
	
  35.

  	
   

  	
  Philips Semiconductors India Pvt Ltd.

  	
   

  	
  India

  	
   

  	
  100%

  
	
  36.

  	
   

  	
  Philips Semiconductors US Inc

  	
   

  	
  USA

  	
   

  	
  100%

  
	
  37.

  	
   

  	
  Philips Semiconductors Canada Inc

  	
   

  	
  Canada

  	
   

  	
  100%

  
	
  38.

  	
   

  	
  Philips Semiconductors Brasil Ltda

  	
   

  	
  Brazil

  	
   

  	
  100%

  
	
  39.

  	
   

  	
  SSMC (Systems on Silicon Manufacturing Company Pte.
  Ltd.)

  	
   

  	
  Singapore

  	
   

  	
  50.5%

  
	
  40.

  	
   

  	
  NXP Funding LLC

  	
   

  	
  USA

  	
   

  	
  100%

  

 

EQUITY INVESTMENTS

 

	
  No.

  	
   

  	
  JV Entity

  	
   

  	
  Country

  	
   

  	
  JV Stakeholder(2)

  	
   

  	
  Ownership

  Interest

  
	
  1.

  	
   

  	
  Advanced Semiconductor
  Manufacturing Corporation Limited

  	
   

  	
  China

  	
   

  	
  Philips Electronics
  China B.V. (3)

  	
   

  	
  26.65%

  
	
  2.

  	
   

  	
  Beijing T3G Technology
  Company Limited

  	
   

  	
  China

  	
   

  	
  NXP B.V.

  	
   

  	
  40.84%

  
	
  3.

  	
   

  	
  Sunext Technology Co.
  Ltd.

  	
   

  	
  Taiwan

  	
   

  	
  NXP B.V.

  	
   

  	
  32.3%

  

 

	
   

  	
   

  	
  (2)                     As
  far as the NXP B.V. stake is concerned.

  	
   

  	
   

  
	
   

  	
   

  	
  (3)                     Ownership to be
  transferred to NXP B.V. following expiration of lock up.

  	
   

  	
   

  

 

 

 

SCHEDULE 8.18

 

INTELLECTUAL PROPERTY
LITIGATION

 

NETHERLANDS/CENTRAL

 

A.                      Litigation
matters

 

I.                                                               Biax (Case TA 129)

 

•                            Biax
Corporation of Boulder, Colorado (Biax) filed a complaint with the U.S.
International Trade Commission (ITC). The ITC case was originally filed on
December 8, 2005, with a third amended complaint filed on February 17, 2006.

 

•                            The
complaint alleges that Philips Semiconductors B.V., Philips Consumer
Electronics B.V., Philips Consumer Electronics North America Corp. and 2Wire,
Inc. are infringing Biax’s U.S. patents Nos. 5,021,945, 5,517,628 and 6,253,313
by importing into the U.S., selling for importation into the U.S. and the
selling within the U.S. after importation of certain digital processors and
digital processing systems, in particular the Nexperia line of processors that
contain a TriMedia core and the televisions produced and/or sold by Philips
containing these chips.

 

•                            In
parallel proceedings, Biax filed a patent infringement action in the Eastern
District Court of Texas. In the Texas case all three of the above-mentioned
patents are at issue, along with U.S. patent No. 4,847,755. The infringement
proceedings in Texas have been stayed until the ITC action has been resolved.

 

•                            The
TriMedia core technology is used in digital television sets and (multimedia)
mobile phones. The TriMedia core technology was developed by Philips,
subsequently spun off as TriMedia Technologies, Inc., and later re-acquired by
Philips.

 

•                            2Wire
has a non-exclusive, non-transferable, royalty-bearing, worldwide license to
the TriMedia technology and uses this technology in its products. According to
the license agreement TriMedia – now Philips Semiconductors, Inc. – is obliged
to defend and indemnify 2Wire at its expense for any loss suffered in any
action based on a claim that the TriMedia technology, when used in accordance with
the license, infringes U.S. patents. 2Wire has sent Philips Semiconductors,
Inc. a notice regarding Philips’s obligations under the license. Philips
understands the indemnification agreement to cap its obligations at USD 2
million, including legal fees incurred by 2Wire. However, 2Wire also purchases
TriMedia chips from Philips and wants to claim part of the liability under the
sales relationship.

 

•                            On
January 9, 2006 the ITC issued a notice of investigation in which it announced
that an investigation will be instituted on the basis of the complaint. In
response to the ITC, Philips denied the alleged patent infringement as set out
in the complaint and gave an outline of its defenses. On February 9, 2006 the
ITC ordered the parties to file a statement of discovery with the ITC, which
was discussed in a preliminary conference at the ITC held on March 1, 2006.

 

 

 

•                            The
discovery phase of the litigation has been finalized. Expert witnesses have
been identified and depositions of Philips experts have been filed. Philips
further filed several motions of non-infringement and
invalidity/unenforceability.

 

•                            Judge
Harris has found non-infringement on the Firing Time patent. We are waiting for
the Commission to approve the judge’s Summary Determination decision. We are
still waiting to hear on several motions still outstanding on the two Condition
Code patents.

 

•                            The
hearing in this matter will commence immediately following the conclusion of a
prehearing conference, and is scheduled for October 12th through October 18th.

 

•                            Biax
has filed a motion requesting a 3-month delay in the hearing based on 1) the
spinoff of NXP, 2) the need to review the Philips’ workaround and 3) time to
give Commission to review the Summary Determination decision on the Firing Time
patent.

 

•                            The
risks associated with the ITC action centre around ‘exclusion orders’ which may
bar infringing products– and ‘downstream’ products containing infringing
products –from import into the United States. The total sales of TriMedia
products amount to USD 200 million, of which 20% is sold directly in the United
States. Part of the chips sold outside the United States is incorporated in
products sold in the United States. Monetary damages are not at issue in the
ITC investigation. If and when the Texas action is revived, Biax may claim
monetary damages in that action.

 

•                            Biax
has previously asserted its patents against IBM, Apple and Motorola in the
District of Delaware, and against Texas Instruments before the ITC. The
IBM/Apple/Motorola case was settled pursuant to undisclosed terms. Texas
Instruments won summary determination of no infringement of two patents and
settled the remainder of the case pursuant to undisclosed terms. Biax is
currently asserting its patents against Intel and Analog Devices in the Eastern
District of Texas.

 

•                            Philips
is aiming at a settlement. An early overture to Biax concerning settlement in
the range of anticipated litigation costs, USD 3-4 million, was not accepted by
Biax. Through July 2006, legal expenses totaled approximately USD 3.3 million.
Philips provided Biax with relevant sales information. It is believed that Biax
expected Philips to have had higher sales than it actually does. On June 13,
2006 Biax made an offer of USD 38 million paid for the life of the Biax patent
portfolio, which would also cover chips made by 2Wire. Although Biax indicated
that this was more of a gut response to Philips’s low offer of USD 3.3 million,
and that they were willing to negotiate, Philips indicated at that time to Biax
that it did not want to meet until Biax reduces its offer to a more reasonable
level. After Philips won the summary determination motion in the ITC of
non-infringement on 1 of the 3 patents, BIAX has now lowered its settlement
offer to USD 15 million. Further, design around efforts have been undertaken to
cap exposure.

 

II                           Sumitomo Special Metals /
Neomax (Cases TA 405 and TA 406)

 

•                            Neomax
(formerly Sumitomo Special Metals Co. Ltd.) filed patent infringement actions
in Germany against the mobile phone operators T-Mobile and Vodafone D2. The
actions are based on the German part of their European patent EP 0 101 552
relating to magnet material. T-Mobile and Vodafone D2 are allegedly infringing
this

 

 

 

patent
by selling and distributing (about twelve brands of) mobile phones which
allegedly make use of Nd-Fe-B magnets in their loudspeakers and vibrators. The
claim is based on a patent that expired in July 2003. Neomax therefore only
claims damages for past use; from September 1989 through July 2003. Patent
nullification actions were filed by T-Mobile at the Federal Patent Court on
December 7, 2004 and by SonyEricsson on December 7, 2005.

 

•                            T-Mobile
and Vodafone D2 have sent third party notices to their suppliers of mobile
phones and speakers.

 

•                            T-Mobile
sent third party notices to Alcatel SEL AG, Robert Bosch GmbH, Motorola GmbH,
Nokia GmbH, Panasonic Deutschland GmbH, Philips Consumer Electronics, Research
in Motion UK Ltd., Samsung Electronics GmbH, Sharp Electronics GmbH, Siemens
AG, Sony Ericsson Mobile Communications Int. AB, Philips Austria GmbH, Sony
Deutschland GmbH and Ericsson GmbH. The litigation has been joined by Nokia,
Philips, SonyEricsson, Ericsson, Samsung, Siemens and Research in Motion.

 

•                            It is
believed that Vodafone D2 has sent third party notices to Nokia GmbH, Philips
GmbH, Philips France, Alcatel, Sagem and Sony Ericsson. Philips Austria GmbH
and Sonion A/S received a third party notice from Nokia. The litigation has
been joined by Nokia GmbH, Philips GmbH, Sonion A/S and Ericsson GmbH.

 

•                            Some
suppliers of mobile phones have in their turn sent third party notices to
Philips Semiconductors, because Philips Semiconductors manufactures the
speakers containing the allegedly infringing magnet material in question and
supplied them with such speakers for their mobile phones. The relationships
between particular mobile phones, particular speakers and especially particular
magnets have been very difficult to establish. Philips has supplied most of the
parties with part of their products, where the largest customers would be Nokia
(supposedly purchased 100% from Philips), Motorola and Siemens. Samsung,
Panasonic and Sony Ericsson, however, may not have been customers for these
particular products. All of these companies may hold Philips liable. Philips’s
indemnification provisions are not identical among all the companies involved,
and some indemnification provisions are not limited to the value of the goods
delivered. The indemnification provisions do require that the customer hand
over the management of the litigation to the supplier (which T-Mobile and
Vodafone have not done, and Nokia and others could not do). In the end this
would come down to a negotiation process with the customers, taking the long
term relationship into account. Philips Semiconductors purchases the allegedly
infringing magnet material from small Chinese suppliers. According to Philips
it is doubtful whether they can get an indemnification from such suppliers.

 

•                            In the
T-Mobile case, appeal proceedings at the Oberlandesgericht Düsseldorf are
pending. The Oberlandesgericht did not render a final decision yet but has
given a preliminary opinion. It decided to appoint an expert to take evidence
on the infringement question. The expert will commence his activities in the
near future. Neomax has filed revision to the Bundesgerichtshof against the
judgment in part of the Oberlandesgericht.

 

•                              In
the Vodafone D2 case, the Landgericht Düsseldorf split the litigation into
separate cases for different mobile phone models/suppliers (Nokia, Siemens, Ericsson,
Motorola, Alcatel, Philips and Sagem phones). The Landgericht has decided to

 

 

 

appoint an expert to take
evidence on the infringement question. No decision has been rendered yet.

 

•                            Neomax
dismissed its initial claim of approximately USD 100 million, which was based
on the profits made by the sales of the mobile phones involved. The court
recently indicated that a link to the sales price of mobile phones (or even to
the telephone operator’s business) will not be considered. Philips’s best guess
is that the financial risk involved, based on what they consider to be a
reasonable royalty per magnet, is substantially lower than this amount. If the
royalty would ultimately be linked to, for example, the speakers instead of the
magnets inside the speakers, the total risk could be higher (but still
significantly lower than if the amount would be linked to the sales prices of
the mobile phones or the telephone operator’s business). Neomax has recently
shown an interest in negotiating with Philips Semiconductors directly, on the
condition that a total solution with all parties can be achieved. Philips
Semiconductors is now in discussions with Sonion, the (only) other speaker
supplier involved, to agree an aligned approach. Philips Semiconductors intends
to propose a settlement for use of the (expired) patents anywhere in the world,
against the royalty rate that was available to the industry (5%), even dropping
arguments about parts of its purchased magnets already being licensed. This
would amount to a payment of less than USD 1 million. Neomax’s benefit in this
would be that they remove the risk of being held liable for the involved
parties’ legal costs.

 

III.                                                      Kreft (Case TA 184)

 

•                            Technische
Beteiligungsgesellschaft Hanau GmbH (TBH) sued Giesecke & Devrient GmbH and
Philips Semiconductors GmbH on July 11,2006 for infringing patent DE 3,935,364.
Philips sells smart card ICs that communicate via a contact and a contact-less
interface with a reader, and TBH claims that the patent covers the way the
switching between these two interfaces operates. Giesecke & Devrient buys
Philips ICs and manufactures dual interface smart cards. Philips has indemnity
obligations towards Giesecke & Devrient.

 

•                            The
first assertion by the patent owner (Mr. Kreft) was in April 2001. Philips
always took the position that its ICs did not infringe, although there is a
risk that Philips’s solution could be judged as an equivalent solution. The
case was dormant for years but was renewed with a new assertion letter dated
March 3, 2006.

 

•                            The
claimed amount in the German lawsuit is EUR 500,000, but it is believed that
the worldwide financial risk is less than this amount based on the worldwide
sales and a reasonable royalty. As this lawsuit is in an early phase,
additional information may required a modified assessment.

 

B.                        Claims –
pending cases

 

I.                                                              Tessera (Case TA 489)

 

•                            There
is a risk that Tessera will file suit against Philips Semiconductors for
alleged infringement of the patent “family” that includes U.S. patents Nos.
5,852,326, 5,679,977, 6,433,419, 6,465,893, European Patent EP1111672 and
corresponding patents in Korea and Japan. These patents relate to the packaging
of integrated circuits (“ICs”), and more specifically to an important subclass
of ball grid arrays (“BGAs”). A product falls within the subclass when its
substrate is relatively flexible or thin and the pitch between terminals is
relatively small. This subclass is

 

 

 

particularly relevant for
the applications for which miniaturization is key (such as mobile phones). The
patents expire in September 2011.

 

•                            Tessera
has not filed a lawsuit yet against Philips Semiconductors, but it did make
statements on its actual liability. Philips estimates that the chances that the
outcome of a lawsuit would be unfavorable to Philips Semiconductors are over 70
percent. Tessera has already been successful in its lawsuits against Texas
Instruments, Sharp and Samsung, and several competitors have taken a license
against considerable payments. A number of lawsuits are currently pending against
other competitors and foundries, including STMicroelectronics, Infineon, Micron
and ASE. Infineon, Micron, STMicroelectronics and Philips have in turn filed
oppositions against EP1111672 before the European Patent Office.

 

•                            Philips
Intellectual Property and Standards, on behalf of Philips Semiconductors, have
been discussing license terms with Tessera since the third quarter of 2004.
Tessera explained its licensing program and showed reverse engineering data on
one of Philips IC packages. The package had a similarity to one of Intel’s IC
packages, for which Intel pays royalties to Tessera. After signing a
non-disclosure agreement, Tessera presented its model for licensing payments.
Although counsel believes that Tessera’s position outside the United States is
weaker than inside the United States, Tessera refuses to take that into account
in the royalty calculation and wants a worldwide license with worldwide
payment. For the period up to and including 2005, Tessera claims a one-off
payment for past use in the amount of about USD 7 million. Tessera has always
indicated that there is some flexibility in this past use amount. Tessera wants
to agree on a running royalty per BGA package depending on its number of pins,
with a maximum of USD 0.06 per BGA package. This would amount to approximately
EUR 5-8 million per year for Philips Semiconductors including packages sourced
from its subcontractors, depending on sales. It is Philips’s position that the
subcontractors are responsible for the packages they supply to Philips. Tessera
had indicated that Philips may let its subcontractors pay their own royalties.
Tessera indicated that the royalty rate proposed in February 2006 was the
lowest possible, so they may not be inclined to lower it further.

 

•                            Philips
sent a proposal to Tessera on July 8, 2006 to pay the past use and part of the
running royalties with a back license under Philips’s U.S. patents 5,739,591,
6,177,295 and 5,504,036 and their respective family members (which will all
transfer to the Company or a Company Subsidiary in connection with the
Transaction) for the Shellcase technologies including the right to sublicense
these patents to Tessera’s Shellcase licensees. On July 28, 2006 Philips was
informed by Tessera that they are not willing to accept this form of payment.

 

•                            The
proposal made by Philips on September 1, 2006 included a past use payment of
USD 3 million, including the whole of 2006 and a proposal not to pay for
packages supplied by Philips Semiconductors’ main subcontractors. Tessera’s
counter offer included a past use payment of USD 10 million, including the
first half of 2006 with a responsibility to pay for packages supplied by
subcontractors. For the packages supplied by subcontractors we are coordinating
with NXP’s purchasing department. For the past use, including Q3 2006 we expect
to be able to settle for about 5.5 million Euros.

 

•                            The
discussions with Tessera remain mainly focused on the following issues:

 

•                            the
amount of the past use payment

 

 

 

•         and
responsibility for royalty payments in case packaging is carried out by
subcontractors.

 

•                            In
relation to products manufactured by Philips using technology licensed from
Amkor, Amkor has an indemnification obligation capped at USD 1 million under
the applicable license and technology transfer agreement.

 

II.                                                          Alliacense (Cases TA443, TA486, TA13621 and TA13864)

 

•                            Several
assertions have been made relating to alleged infringement of U.S. patent No.
5,440,749 and related dependent patents (the so-called Moore Patent Portfolio)
relating to microprocessor technology and co-owned by Technology Properties and
Patriot Scientific (now joined in the new company Alliacense). Because of sales
by Philips of TriMedia microprocessors in the U.S., Technology Properties and
Patriot Scientific in the past offered to settle for USD 22 million but did not
want to substantiate their case. Philips refused the offer and is of the
opinion that its microprocessors did not infringe the patents involved.

 

•                            Patriot
Scientific approached a number of Japanese PC companies, such as Sony,
Matsushita, Fujitsu, NEC and Toshiba. Intel, as supplier of Pentium chips, came
to their defense. In 2004, Sanyo asked Philips for assistance in their defense.
Philips explained that it does not believe that the Philips microprocessors
infringe. Recently, Intel, which produces similar microprocessors to those that
Philips does, took a license from Technology Properties and Patriot Scientific
for an amount of USD 10 to 25 million. In addition, Bosch and Agfa Gevaert
recently sent a letter to Philips indicating that they had been approached by
Alliacense for alleged infringement by products incorporating Philips
microprocessors and asking for indemnification. Philips Semiconductors is
receiving questions from more customers about the Moore patents. Recently,
Alliacense approached Philips Consumer Electronics again to present their claim
against microprocessors used in products from both Philips Consumer Electronics
and Philips Medical Systems. Because the patents pertain to microprocessor technology,
Philips Consumer Electronics and Philips Medical Systems are requesting
indemnification from their suppliers, including Philips Semiconductors.

 

•                            Alliacense
primarily approaches companies such as Sanyo, Bosch, Agfa Gevaert, and Philips
Consumer Electronics that manufacture finished products incorporating
microprocessors, relying on patent claims that allegedly cover the combination
of microprocessors with other components. Although Philips Semiconductors is
generally not liable for infringement by the combinations, Philips
Semiconductors could be liable in case their products implement all features of
one or more of the Moore patent claims. Besides from indemnification requests
by customers, liability could also arise from Alliacense directly if they would
decide to approach Philips Semiconductors (risking exhaustion of their patents.
However, Alliacense like their predecessors declined to discuss a license on
the chip level, keeping their focus on higher value products.

 

•                            Several
manufacturers have recently entered into license agreements with Alliacense,
including Fujitsu, HP, Sony, apparently not protected by their customer status
of Intel and AMD.

 

 

 

III.                                                      Silicon Image (Case TA 189)

 

•                            In
2003, Philips Semiconductors wanted to make ICs using a standard developed by
Silicon Image. Philips Semiconductors performed a check under which patents a
license might be required. No such patents were identified.

 

IV.                                                      IGR (Cases TA 190 and TA 204)

 

•                            Interessengemeinschaft
fur Rundfunkschutzrechte (IGR) sued Quelle in Germany under patents DE
3,137,535; DE 2,827,159 and DE 2,902,933, all of which are now all expired.
Philips is not a party to the litigation.

 

•                            Quelle
is seeking indemnification from Elektronika Velenje and Vestel. Both Velenje
(case TA190) and Vestel is seeking indemnification from Philips (case TA204).
Philips products concerned are stereo sound ICs TDA9870, 9875, 9840 , and 9820.
These TV manufacturers also bought similar products from Micronas, which makes
it difficult to calculate possible liability.

 

•                            Philips
already has a license under these patents from the IGR, which is acknowledged
by IGR, but IGR claims that the patent claims (and thus the license) do not
cover ICs. In Philips’s view, the patents are so broad that they do cover ICs.
If so, Philips’s ICs are covered, and the patents are exhausted with respect to
the Quelle TVs that incorporate Philips ICs. However, if the patent claims are
considered insufficiently broad to cover ICs, and only TVs are covered by the
patents, there would be no such exhaustion. Philips Semiconductors cannot be
held liable vis-a-vis Velenje and/or Vestel for more than the ICs themselves.

 

V.                                                          Peng Tan (Case TA 316)

 

•                            In
February 2002, American Invention and Patent, which is believed to be an entity
owned and operated by the inventor of the asserted patent, Peng Tan, approached
Philips for alleged infringement of U.S. patent 4,682,857 by employing an IC
die or wafer failure analysis method of hot spot detection utilizing liquid
crystal material. While various claims of the patent have been mentioned, only
one very broadly-worded claim provides any significant risk of infringement.
Philips filed for re-examination with the USPTO and was successful in the first
instance. An appeal is pending, and no negotiations are ongoing. Submissions on
appeal by Peng Tan and by the Examiner have been filed. The next step is for
Board of Patent Appeals and Interferences to decide the appeal; it is not known
when the Board will hear the case.

 

•                            The
royalties claimed are in the order of USD 500,000. The patent expired in April
2005.

 

VI.                                                      Technology Properties /Leckrone (Case TA 443)

 

•                            See
Alliacense (Cases TA 13621 and TA 13864).

 

VII.                                                  Innovatron (Case TA 450)

 

•                            On
December 11, 2003, Innovatron asserted the following patents against Philips
Semiconductors B.V.:

 

•                            ISO
Patents: all family members of FR9615163; FR9702501; FR9800383

•                            Application
Patents: all family members of FR9804453; FR9812770.

 

 

 

•                            In a
letter dated Jan 12, 2004, Innovatron informed Philips about the terms and
conditions of Innovatron’s license program: lump sum or USD 100,000 and
royalties of 2% of net sales price, or lump sum of USD 10,000 and royalties of
4% of net sales price.

 

•                            Philips
has since negotiated with Innovatron, and it seems that not all their patens
are relevant. The total estimated financial risk to Philips for the years 2002
to 2009 is EUR 2 million.

 

VIII.                                              Patriot Scientific (Case TA 486)

 

•                            See
Alliacense (Cases TA 13621 and TA 13864).

 

IX.                                                     WiLAN (Case TA 491)

 

•                            WiLAN
has claimed that their patents U.S. 5,282,222 and U.S. Re37,802 covered the
standards for 802.11b/g and 802.15.3a (UWB). In 1999, Philips licensed WiLAN’s
technology, but the collaboration was short-lived. In June 2004, WiLAN claimed
that as a result of Philips’s use of WiLAN’s technology, Philips owed royalties
of 7% under the license agreement. Philips maintains that it did not use their
technology and hence does not owe any royalty. After a meeting, WiLAN they
backed off position but continued to claim that Philips owed royalties for
allegedly infringing their patents. Philips suggested that WiLAN join the
patent pool; WiLAN reportedly applied to the patent pool but failed
essentiality test. Contractual issues remain.

 

•                            WiLAN
is still considering Philips settlement offer (around USD 200,000). No changes
since September 2005.

 

X.                                                         Eastman Kodak (Case TA 497)

 

•                            Eastman
Kodak filed an infringement case in the United States against Sony Ericsson
under 11 U.S. patents relating to digital cameras. Sony Ericsson requested indemnification
from Philips Semiconductors for supplying image sensors of the type OM6800/01.
Philips denied liability on the basis that Philips did not infringe and
liability arising from combining the image sensors with other parts was
excluded in the sales agreement. Sony Ericsson did not address these arguments.
The latest message from Philips to Sony Ericsson was communicated on April 29,
2005, and no response has been received. The image sensor business has since
been discontinued.

 

XI.                                                     Cryptography Research (Case TA 509)

 

•                            On or
about August 2004, Cryptography Research, Inc. (CRI) asked Philips
Semiconductors GmbH to license U.S. patent Nos. 6,298,442, 6,304,658,
6,654,884, 6,327,661, 6,510,518, 6,381,699, 6278,783, and 6,539,092 along with
continuations and European counterpart patent applications. CRI states that
these patents cover various cryptographic counter measures to Differential
Power Analysis (DPA) attacks.

 

•                            Philips
sells integrated circuits (IC’s) used in smart cards, passports and similar
applications. These IC’s are tamper-resistant. DPA is one kind of tampering
technique. CRI claims to have all countermeasures for DPA attacks covered by
their patents. If CRI’s claim is accurate, Philips’ smart card IC’s would be
implicated.

 

 

 

•                            In June
2006, Philips and CRI representatives met in Hamburg, Germany to discuss a term
sheet that was provided by CRI detailing the terms of the CRI proposal. Philips
is considering CRI’s proposal, which would result in a royalty-bearing license.
CRI offered Philips a royalty-bearing patent license at a rate of approximately
USD 2.5 million per year.

 

•                            Negotiations
with CRI are ongoing. One possible outcome is an agreement by Philips to accept
a license from CRI.

 

XII.                                                 Intermec (Case TA 513)

 

•                            Intermec
Technologies Corporation (Subsidiary of UNOVA) asserted in September 2004 the
following patents against Philips Semiconductors B.V.: US4,739,328;
US5,030,807; US5,777,561; US5,828,693; US5,850,181; US5,912,632; US5,995,019;
US6,429,775; US6,288,629; US5,528,222; US6,371,375. In a meeting with Intermec
in February 2005, it was clarified that Philips Semiconductors B.V. is licensed
for several of these patents under an old cross license agreement with IBM.

 

•                            Intermec
is an aggressive licensor and, for example, has sued Matrix based on four of
above patents. Philips Semiconductors B.V., based on the fact that it is
already licensed for several of these patents, decided not take any further
licenses. Since September 2005, there has been no communication in this case,
and it is more or less dormant. For the new EPC Global GEN 2 IC, which will
have high volume in the future (2007) a solution with Intermec will be needed.

 

XIII.                                             Motorola (Case TA 528)

 

•                            In
October 2004, Philips customer VTech informed Philips that Motorola asserted
U.S. patent 5,784,585 against VTech in relation to the use one of Philips’s ICs
(PCD80710). This IC incorporates an ARM7 with the “Thumb” instruction set.
Philips relayed this back to ARM, and they provided reasoning for
non-infringement which was passed on to VTech. Since then Motorola have been
applying pressure in VTech. Because of a chain of indemnity between ARM,
Philips and VTech, Philips is in the middle of a discussion which should be
between ARM and Motorola. Philips has initiated a dialogue between ARM and
Motorola and hopes that they will sort out the matter themselves.

 

XIV.                                             Sennheiser Electronic (Case TA 553)

 

•                            Sennheiser
Electronic GmbH & Co. KG presented their patents EP0889544B1 and U.S.
6,210,241B to Nokia. Philips Sound Solutions (PSS) received a notice from Nokia
on January 19, 2005 and directly from Sennheiser via their lawyers on September
2, 2005.

 

•                            Sennheiser
claims that a speaker, which they found in a Nokia phone, infringes these
patents. Sennheiser offered their patents for sale; as an alternative, they
offered a license on their patents. It is unlikely that Sennheiser will attempt
to bar PSS from producing loudspeakers, and at worst Philips would have to take
a license (although Philips does not believe that it is infringing Sennheiser’s
patents).

 

 

 

•                            On
February 14, 2006, Philips sent its most recent letter to Sennheiser. Philips
cited two speakers, which are novelty destroying for U.S. 6,210,241 and EP 0
889 554. Thus, from Philips’s point of view the Sennheiser patents are not
valid. As evidence, drawings, invoices, and a declaration under oath were
presented. Furthermore evidence was requested whether the speaker found in the
Nokia phone indeed is a Philips product. No answer has been received so far.

 

XV.                                                 Cabot Microelectronics Corporation (Case TA 557)

 

•                            Cabot
Microelectronics believes that Cheil, a Samsung company, is infringing patents
EP0844290, SG65839 and U.S. 5,980,775 covering the IC wafer polishing slurry
claims. IC manufacturers using the Cheil product are alleged to infringe the
method claims in the patents. Cabot first wrote to Philips Semiconductors on
January 21, 2005 to inform Philips Semiconductors about their issues with
Cheil. Philips Semiconductors is not directly implicated, as they only use the
Cheil product in Nijmegen, while Cabot does not have a patent in the
Netherlands, and as under European patent laws, the Nijmegen ICs cannot be
considered as directly obtained by the patented process. However, Samsung would
not provide full indemnification and is also not willing to file a nullity
action, and the contract party, Braztek, is not strong enough to indemnify.
Therefore, Philips Semiconductors has planned to stop using the Samsung/Cheil
slurry in the IC Manafacturing Operations but to continue using the slurry from
Cabot for manufacturing operations in those countries where Cabot does have a
patent.

 

•                            A
German court case initiated by Cabot to get more information from Cheil was
withdrawn for procedural reasons. In March 2006, Cabot filed an action against
Cheil before the U.S. International Trade Commission.

 

•                            Philips’s
most recent contact with Cabot was in March 2005.

 

XVI.                                             Scanner Technologies Corporation (Case TA 5938)

 

•                            Philips
received a notice from Alacron on July 18, 2005 following Alacron’s receipt of
a letter from Scanner Technologies stating that Philips products resold by
Alacron allegedly infringed Scanner Technologies’ patents.

 

•                            Scanner
Technologies claims that any chip with ball grid arrays (BGA) that are
inspected using their patented method infringe their U.S. Patents No.
6,064,757; 6,072,898; and 6,862,365. The three patents cover a method for
inspecting the BGA on chips. These chips include numerous Philips Nexperia
chips with BGAs, specifically including PNX1302EH and PNX1501E.

 

•                            Philips
has not had direct contact with Scanner Technologies. Alacron informed Philips
that in their initial conversation with Scanner Technologies, Scanner
Technologies indicated that they were seeking a 10% royalty for every chip that
is inspected under their claimed method of inspection.

 

•                            No
lawsuit has been filed in this assertion. The asserted patents cover a method
of testing BGA on chips. Testing on Philips’s chips occurs in Taiwan either in
an ASE facility or in Philips’s own facility using ICOS equipment Both ICOS and
ASE have been contacted regarding indemnity. ASE has indemnification
obligations under the contract between ASE and Philips. ICOS is aware of the
matter and filed for declaratory judgment against Scanner Technologies in July 2005
seeking a ruling

 

 

 

that chips with BGA that
are tested using the patented method outside the U.S. do not infringe the
patent. ICOS has also been involved in litigation with Scanner Technologies in
Federal Court in New York regarding these patents since 2000.

 

•                            Philips
has communicated with both ASE and ICOS regarding indemnification. The last
date of communication with ICOS was October 12, 2005, when Philips received a
letter of assurance from ICOS that the ICOS equipment does not practice any
claims of the asserted Scanner Technologies patents.

 

•                            Scanner
Technologies’s assertion is considered weak assertion because they are trying
to claim that an inspection method used outside of the country infringes a U.S.
patent.

 

XVII.                                         Avante International Technology (Case TA 12834)

 

•                            Avante
International Technology Inc. sent an assertion letter dated October 10, 2005
and asserted patents U.S. 6,665,193 and U.S. 10/732,984 against RF tags made by
Philips Semiconductors B.V. The patents relate to the manufacturing of RF tags.

 

•                            In
December 2005 a letter was sent to Avante pursuant to which Philips requested a
claim chart that clarifies why Avante is of the opinion that Philips products
infringe their patent. No response has yet been received.

 

XVIII.                                     Vcode Holdings an Acacia Technologies, Inc.
subsidiary (Case TA 13136)

 

•                            Acacia’s
patents U.S. 4,924,078; U.S. 5,612,524 and EP 0438841 allegedly cover a two
dimensional data matrix ID tag that holds more data than a standard bar code.
It is alleged that Philips Semiconductors sells IC’s with labels having this
type of tag. Philips Semiconductors have contacted our supplier of bar code
label printers, Intermec, with a request to indemnify.

 

•                            Acacia
has asked for USD 0.5 - 2 million for a fully paid license for the life of the
patent. The life is 18 months from April 15, 2006. Philips received notice in
November 2005.

 

•                            Philips
can and is willing to design around by using the PDF-417 bar code (as used by
Fed Ex) instead of the DataMatrix bar code alleged to be infringing. Acacia
represented that it believes that this PDF-417 bar code is not covered by the
patents at issue. .

 

XIX.                                            Samsung (Case TA 13182)

 

•                            Samsung
asserted U.S. 5,581,716 against BENQ relating to a DVD RW using a Philips
PNX7860E IC. Samsung’s claim appeared to be based on compliance with the ATA-3
standard (a CD/hard disc interface standard). This was relayed back to BENQ.

 

XX.                                                Curitel cq. Pantech (Case TA 13285)

 

•                            In
one of Philips’s licensing programs, the other party claimed that U.S.
6,215,905; KR 413,979; KR 086,267 were of interest for Nexperia in an attempt
to get a cross-license.

 

 

 

XXI.                                            Ericsson (Case TA 13513)

 

•                            Ericsson
has initiated lawsuits against Samsung for alleged patent infringement of 15
U.S. patents by their GSM/GPRS mobile phones, along with six patents in Germany
and two in the Netherlands. Ericsson has started a case in the UK as well.
Samsung requested assistance from Philips because Philips chipsets OM6359EL,
PCF5212, and PCF5213 are incorporated into Samsung GSM/GPRS mobile phones.
Philips believes that the 15 U.S. patents asserted by Ericsson against Samsung
to fall within the scope of a patent cross-license agreement for Mobile Radio
Communication Systems between Philips and Ericsson as regards their subjects
and as regards the time period up till July 1, 2000. The cross-license
agreement extends only to the Philips products and not to combinations thereof.

 

XXII.                                        Avermedia (Case TA 13532)

 

•                            This
case relates to an injunction action in Taiwan by Avermedia against Animation
based on alleged infringement by Animation of Avermedia’s TW patent I240169 on
an audio video signal transceiving device. Animation uses a product design that
may be based on a reference design and chip set of Philips Semiconductors.
Animation has requested Philips support (although Philips has no formal
obligation to provide it). Both Avermedia and Animation are customers of
Philips, and Philips wants to keep a good relation with both. Philips provided
Animation with prior art but will not start legal action itself. The patent
seems weak.

 

XXIII.                                    Card Soft (Case TA 13618)

 

•                            Card
Soft Inc. of San Mateo, California sent an assertion letter dated March 10,
2006 that their patent U.S. 6,934,935 is essential to a GPD/STIP Specification
2.2 drafted by the Global Platform. It seems that this letter was sent to all
members of the Global Platform. Philips acknowledged the receipt of the letter
and asked for a claim chart showing why a product of Philips infringes. On
April 7, 2006, Philips received a claim chart with regard to the GPD/STIP
Specification 2.2. It is Philips’s understanding that the claim does not read
on a product of Philips Semiconductors, but further discussions may be
required.

 

XXIV.                                    LG Electronics (Case TA 13902, TA 14066)

 

•                            LG
Electronics (LGE) asserted patents EP 0 335 521, EP 0 548 054, EP 0 719 439 and
foreign counterparts thereof against Philips’s cell phone business
semiconductor businesses. These patents were previously owned by British
Telecom. LGE claims these patents cover the GSM/3GPP standards that are used in
cell phones. They also asserted the patents against Nexperia Baseband Chipset
including PCF 5212, PCF 5213, PNX 5220, PNX 5221 and PNX 5230. Samsung is
probably the largest customer of these chips and Samsung already asked Philips
Semiconductors for comments. LGE also seized some phones in France and some
other financial documents based on this assertion.

 

•                            Philips
argues that, under a JPEG licensing-out program between Philips and LGE, LGE is
obliged to license these patents to Philips under similar terms as the JPEG
licenses. Further, British Telecom entered into some undertakings to ETSI that
are still believed relevant for these patents.

 

 

 

•                            In
August 2006, LGE added LGE’s US Patent 6,529,730 which is allegedly essential for
the AMR technology as used in the GSM standard.

 

•                            For
all these patents, Philips Semiconductors’ position is that they are not liable
for standard essential patents.

 

XXV.                                        Canon (Case TA 13986)

 

•                            On
22 March 2006, we received a claim chart from Canon claiming that their patent
US 5,231,495 is infringed by Philips’ Nexperia and DVD products, in particular
the PNX8550. Canon did not specify any damages. Although the US patent has
rather broad claims, the only family member JP3321802 has claims that had been
restricted to overcome Japanese prior art. This is under investigation.

 

•                            On
2 August, Canon extended this assertion by including a larger product list and
citing in addition the patents US 5,566,002; US 5,790,265; US 6,278,486 and US
5,966,495 including their Japanese counterparts JP3542572 and JP2925281.

 

C.                        Claims –
dormant cases

 

I.                                                              Smart Card (Case TA 130)

 

•                            Philips
received a letter in 2000 from Smart Card LLC stating that Smart Card had sued
a number of internet security companies under patents U.S. 5,530,232 and U.S.
5,578,808. Philips does not believe that it is at risk as a customer.

 

II.                                                          Microtune (Case TA 247)

 

•                            In
April 2001, Microtune asserted U.S. patent 6,169,569 against Ericsson for
alleged infringement by a cable modem tuner. Ericsson, as customer of Philips,
in turn requested indemnification from Philips in July 2001. Philips has not
had any direct contact with Microtune, and the case has been dormant since
2003.

 

III.                                                      LSI LOGIC Corporation (Case TA 260)

 

•                            In
December 2001, LSI Logic asserted 28 U.S. patents against various products in
response to the I2C assertion by Philips. After repeated requests for
information relating to their claim of infringement by Philips, no evidence has
been provided. No further communications have been received from LSI in over
two years.

 

IV.                                                      Polycom (Case TA 298)

 

•                            In
January 2002, Philips received a patent assertion by Polycom in response to
other patent assertions against Polycom by Philips. The Polycom assertion
concerned Philips Products (encoders/decoders) using various ITU standards,
G.722.1, H.261 & H.263. H.323 and Polycom patents: U.S. 5924064, 6304928,
5767897, 5367385, 5283646, 4794455, 4727422, 4703350,l 5821986, 5778082.
Polycom has provided no evidence that Philips is infringing its patents.
Philips informed that Polycom that it does not believe there is any
infringement over four years ago, and Polycom has not responded.

 

 

 

V.                                                          Robert Bosch (Case TA 309)

 

•                            In
early 2004, Bosch, along with Siemens and Temic, joined the Safe-By-Wire consortium.
All necessary patent claims of each consortium member are royalty free, so this
issue is now considered resolved.

 

VI.                                                      Technology Licensing Corporation / IP Innovation
(Case TA 338)

 

•                            This
case covers a series of claims made against various Philips Semiconductors's
customers. James Carl Cooper uses a plurality of business names, including
Technology Licensing Corp and IP Innovation. Mr. Cooper’s assertions are
generally somewhat specious, although in one case Philips did indemnify Sanyo
for USD 200,000 after Sanyo settled a case with Mr. Cooper. Philips
Semiconductors has not been approached by Mr. Cooper directly, but from
time to time is requested for assistance by its customers.

 

VII.                                                  Inside Technologies (Case TA 348)

 

•                            Philips
licenses certain patents which are essential for the ISO14.443 and ISO15.693
standards in the radio frequency identification area. Philips asserted its
ISO14.443 and ISO15.693 patents against Inside Technologies (now Inside
Contactless) as they have potentially infringing products on the market. Inside
responded by asserting that their patents U.S. 6,337,619 (WO97/42578) and U.S.
6,033,777 (WO98/06057)) are allegedly relevant for these standards. Based on
Philips’s evaluation, only one of Inside’s patents may be relevant, and on
balance Philips has a stronger position and that Inside would be the net debtor
in this situation.

 

•                            In
2002, Inside filed an opposition against one of the Philips patents. The
opposition procedure is ongoing, and Philips will wait for the outcome before
reviewing the case and possible restarting negotiations with Inside.

 

VIII.                                              Wisconsin Alumni Research Foundation (“WARF”) (Case
TA 352)

 

•                            On
September 4, 2002 Philips received a letter from Intersil Corporation to the
effect that they had received a notice letter from WARF asserting a claim of
infringement of the patents U.S. 4,630,094 (Expired December 16, 2003); U.S.
4,494,136 (Expired December 21,1999) and U.S. 4,350,994 (Expired December
21,1999) for Semiconductors products containing amorphous films, and requesting
that Philips defend and indemnify Intersil. WARF has not identified infringing
products. In August 2003, there was a consensus among the engineers that the
chips that Philips makes do not contain the amorphous barriers that are recited
in all the relevant claims of WARF’s patents. In March 2004, Joseph Grear of
Intersil admitted that “WARF does not currently have a Philips chip that
infringes the WARF ‘094 patent,” but suggests that a Philips .13 micron copper
interconnect chip would infringe because similar competitor chips do.
Mr. Grear states that Toshiba has obtained a license under the patents,
and litigation against Toshiba and Sony (a Toshiba customer) has been
dismissed. Agilent, Rohm, Hitachi, Intel, Matsushita, NEC, New Japan Radio,
Sanyo and Sharp also took licenses. In April/May 2004, a lawsuit was filed
against Samsung.

 

•                            In
October 2005, Philips received another letter from Intersil stating that they
have not heard from Philips regarding this matter, and asking that Philips let
him know how it would like to proceed.

 

 

 

IX.                                                     Siemens (Case TA 396)

 

•                            On
April 9, 2003, V-Tech, a DECT-phone manufacturer and a customer of Philips
Semiconductors, had sent an inquiry letter to Philips Semiconductors with
respect to the relevance of Siemens Patent DE 195 25 425 to a Philips Software
Stack. This patent covers an apparatus for receiving video signals. It appeared
that because Philips was already licensed, it could not be held liable under
this patent. Vtech also cited other Siemens patents which Philips VEGA/ABC
products allegedly would infringe. Philips denies liability in each case either
because Philips is not responsible for any infringement, because the patents
relate to separate software not included in the chipset or because they relate
to standard (e.g. DECT) essential technologies, respectively.

 

•                            On
September 30, 2003 Siemens came forward with a similar patent infringement
claim against Philips customer Detewe.

 

•                            There
have been no further contacts between Philips and Siemens about this issue for
over two years.

 

X.                                                         Optrex (Case TA 397)

 

•                            In
the first half of 2003, Optrex asked Philips’s Japanese IP&S department for
its point of view on some of their Japanese patents on MRA display drivers.
Philips decided to refrain from any analysis of the Optrex patents until Optrex
has explained its claims against Philips in more detail and in an official
letter. There has been no news with respect to this matter since then.

 

XI.                                                     eFLASH (Case TA 413)

 

•                            In
June 2003, eFlash claimed that the Philips compact 2T flash cell infringed
their patent U.S. 5,455,792. This 2T flash cell was one of the several options
investigated at Philips Research and was not in production. It is unlikely that
the compact 2T cell, also referred to as CMP cell, will ever become a product.
In August 2003, Philips Semiconductors sent a message to eFlash indicating that
Philips has no business interest in a license. There has been no contact with
respect to this matter since then.

 

XII.                                                 Raben (Case TA 434)

 

•                            Mr. Raben
approached Philips in September 2003 for damages resulting from infringement of
patent application PCT/EP 93/00814 by ADSL chipsets. Because Philips could not
find any patent rights resulting from this application that were still in
force, Philips responded with a letter in early 2004 saying that because patent
databases showed no pending patent rights, there could be no damage so Philips
would not respond farther to his demand.

 

XIII.                                             Alcatel (Case TA 458)

 

•                            In
October 2003, Philips received a request for assistance from Arima, a customer
of Philips, because Arima was approached by Alcatel on alleged infringement on
Alcatel’s patents by Arima’s GSM/GPRS phones using a Philips IC (GSM GPRS
SySol2 System Solution) purchased from Philips Semiconductors Zurich. Because
Philips’s contract with Arima excludes any liability in case of this patent
infringement, Philips decided not to assist Arima in this case.

 

 

 

XIV.                                             InterDigital Communication Corporation (Case TA 459)

 

Philips customer Arima
requested assistance in relation to a claim by Interdigital against Arima for
the alleged patent infringement of Interdigital’s patents on TDMA wireless
communications products for 2G mobile phones. As in Case TA 458 above, Philips
decided not to assist Arima in this matter.

 

XV.                                                 Texas Instruments (via 3Com) (Case TA 460)

 

•                            In
November 2003, Philips received notice of a possible indemnification claim from
its customer 3Com in connection with very broad assertion by TI against 3Com of
30 TI patents, only a relatively small number of which may be relevant to
Philips. There is a good possibility of settlement by 3Com. At the end of 2003,
Philips sent contact information to 3Com; to date, no further contact made.

 

XVI.                                             Cisco (Case TA 476)

 

•                            In
April 2004, Cisco asserted its U.S. patents 4,963,034 and 4,868,867 against
codecs used in Philips Nexperia products. Philips intended to settle this
counter assertion in the same deal as the license from Philips to Cisco, but
because of the relatively low license income expected from this deal, this
matter has become something of low priority.

 

XVII.                                         Lexar Media (Case
TA 477)

 

•                            In
April 2004, we received a letter from Lexar which discussed the IP owned by
Lexar for various types of flash memory. The letter was not specific about the
products involved. Philips internal counsel phoned Lexar’s attorney to ask him
which Philips products Lexar considered to be infringing. Philips has not
received any response for two years. It is believed that this was just a
‘blanket’ letter and that it relates more to Consumer Electronics than to
Semiconductors.

 

XVIII.                                     MGate (Case TA 529)

 

•                            In
May 2005, Mgate GmbH of Germany sent an assertion letter with a two-page patent
DE 197 28 004 C2. Mgate is of the opinion that this patent reads on Near Field
Communication Devices like mobile phones that comply with the ISO18.092
standard. In 2006, Philips started to sell ICs that comply with this standard.
Philips requested Mgate to send a claim chart that proves why they think a
product of Philips infringes their patent. No response has been received.

 

XIX.                                            Michael Branigin (Case TA 534)

 

•                            In
July 2004, Branigin claimed infringement of U.S. patent 5,471,593 by
microprocessors. No substantiation or identification of individual Philips
products was There have been no further contact with Branigin for a year and a
half.

 

XX.                                                Thomson (Case TA 558)

 

•                            In
February 2005, Philips received notice from LGE that Thomson asserted patent
EP0581835B1 (incl. U.S. 5,389,893) against their LCD TV’s which use a Philips
IC TDA9817. Further, Thomson filed a patent infringement case and ITC action
against BenQ. Philips believes that the TDA9817 does not infringe; the TDA9800
is to be investigated, but Philips has have good prior art. In November 2005,
BenQ won the

 

 

 

ITC case, and the judge
held that Philips’s IC did not infringe Thomson’s patent. BenQ thereafter took
a license under five Thomson patents including the one asserted against
Philips’s IC. However, not all outstanding assertions are yet resolved.

 

XXI.                                            Magellan Technology (Case TA 560)

 

•                            Magellan
Technology said in a letter to Philips Semiconductors dated April 15, 2005 that
their patent US2003/112128 is relevant for all products that will comply with
an EPC Global Standard. WalMart and other stores in 2006 started to request all
suppliers to deliver all their products with tags that comply with this EPC
Global Standard that will replace barcodes in the long run. Philips will start
to sell such ICs in the first quarter of 2007.

 

•                            In
an earlier case, Philips had to take a license from Magellan under a different
patent in the same technology area. However, the current case is now dormant,
as Philips has not had any further communication with Magellan since the
initial letter did not sell such ICs in 2005 and 2006; it is expected that
Philips will have to pay a reasonable royalty or can compensate in a
cross-license with Philips patents relevant to that EPC Global Standard.

 

XXII.                                        Washington Research Foundation (Case TA 567)

 

•                            In
March 2005, Plantronics requested indemnification from Philips Semiconductors
with respect to a letter from the Washington Research Foundation (which is
associated with the University of Washington). The letter from WSF was an
informational letter stating that WRF had patents that covered Bluetooth, but no
specific claims were made with respect to Philips or Plantronics products. An
initial assessment found no infringement.

 

•                            In
November 2005, Philips sent a letter to WRF stating: “If we do not receive
substantive evidence of infringement from you, including a claim chart relating
all attributes of our product to every limitation in the claims, we will assume
that you, as we, consider this matter settled.” Because Philips has not heard
from WRF since the initial March 2005 letter, and because WRF has not responded
to Philips November 2005 letter, this matter is considered dormant.

 

XXIII.                                    Amiga Technologies (Case TA 12777)

 

•                            In
September 2005, HP notified Philips Electronics North America Corporation of a
“potential” indemnification claim with respect to a patent infringement lawsuit
filed by Amiga Technologies, Inc. (a subsidiary of Gateway). The lawsuit
alleged that certain “graphics cards/chipsets or optical drives” infringed U.S.
Patent Nos. 4,874,164 and 5,412,667. In connection with the lawsuit, Amiga
served a subpoena on Philips Semiconductors requesting documents and
information relating to Philips’ CD/DVD error correction algorithms. Philips
supplied certain documents and information relating to the error correction
algorithms and processes used in Philips CD/DVD error correction chips and
explained that Philips chips (and associated optical drives incorporating those
chips) were not using the algorithms claimed in the relevant patents. After
reviewing the documents and information, Amiga voluntarily dropped its patent
infringement claims against HP with respect to the relevant patents.

 

 

 

XXIV.                                    Atmel-Deister (Case TA 13413)

 

•                            Deister
Electronics GmbH co-owns patent U.S. 5,286,955 together with Atmel Corporation.
Philips Semiconductors has close business relations with Deister. Atmel is a
competitor of Philips and entered into a license agreement with respect to a
patent from Philips that Philips asserted in 2004.

 

•                            In
February 2006, the CEO of Deister informed Philips that Atmel plans to use U.S.
5,286,955 that might have relevance for some Philips Semiconductors’ ICs, for
backfire. For this purpose, Atmel asked Deister to sell the 50% ownership of
that patent to Atmel. Mr. Stobbe mentioned to Philips that he would be
interested in looking for a solution with Philips to keep the good relations
between the companies. Philips patent EP 0 473 569 B1 is an elder right for the
EP family member and it appears that Philips already had a first product on the
European market at the time the Stobbe patent was first filed. There has been
no assertion letter yet, and it is possible that there never will be.

 

SPAIN

 

A.                      Claim
against Philips Ibérica for alleged illegal use of “whycry001” software. All
information contained in section I01-01-ES-0001 of the Virtual Data Room is
expressly incorporated in this Schedule 8.18.

 

 

 

SCHEDULE 9.2 

 

COMPANY’S WEBSITE

 

 

http://www.nxp.com

 

 

 

SCHEDULE 13.2 

 

NOTICES

 

1.                          To the
Administrative Agent

 

Morgan Stanley Senior
Funding, Inc.

20 Cabot Square

Canary Wharf

London E14 4QW

England

Facsimile No: +44 20 7056 3377

Telephone No: +44 20 7672 4012

E-mail: David.Hobbs@Morganstanley.com

Attention: David Hobbs

 

2.                          To the Global Collateral Agent

 

Morgan Stanley Senior
Funding, Inc.

20 Cabot Square

Canary Wharf

London E14 4QW

England

Facsimile No: +44 20 7056 3377

Telephone No: +44 20 7672 4012

E-mail: David.Hobbs@Morganstanley.com

Attention: David Hobbs

 

3.                          To Holdings, the Company or the Co-Borrower:

 

NXP B.V.

High Tech Campus 60 

5656 AG Eindhoven 

The Netherlands 

Telephone: (31) 40 272-2041 

Telecopy: (31) 40 272-4005 

Email: guido.dierick@nxp.com

Attention: Guido Dierick

 

With a copy to:

 

KASLION Acquisition B.V. 

High Tech Campus 60

5656 AG Eindhoven

 

 

 

The Netherlands 

Telephone: (31) 20 5407575 

Telecopy: (31) 20 5407500 

Email: erik.thyssen@alpinvest.com 

Attn: Erik Thyssen

 

4.                          To the
Letter of Credit Issuers

 

Morgan
Stanley Senior Funding, Inc.

20 Cabot Square
 Canary Wharf
 London E14 4QW
 England
 Facsimile No: +44 20 7056 3377
 Telephone No: +44 20 7672 4012
 E-mail: David.Hobbs@Morganstanley.com
 Attention: David Hobbs

 

Deutsche
Bank AG, London Branch

Global Transaction Banking
 1 Great Winchester Street
 London EC2N 2DB
 England
 Facsimile No: +44 20 7545 4949
 Telephone No: +44 20 7545 4606
 E-mail: jim.mcsweeney@db.com
 Attention: Jim McSweeney

 

Bank
of America, N.A.

26 Elmfield Rd.,
 Bromley, BR1 1WA,
 United Kingdom
 Facsimile No.: +44 20 8313 2140
 Telephone No.: +44 20 8695 3090
 E-mail: gary.durrell@bankofamerica.com
 Attention: Gary Durrell

 

HSBC
Bank plc

Level 32
 S Canada Square
 London E14 5HQ
 Facsimile No.: + 44 20 7991 4637
 Telephone No.: + 44 20 7991 0563 or
21494
 E-mail: traceyreading@hsbc.com,
davidkimerlin@hsbc.com
 Attention: Tracy Reading or David
Kimberlin

 

 

 

BNP Paribas, Amsterdam
Branch 

Herengracht 477 

1017 BS, Amsterdam 

The Netherlands

Facsimile No: +31 (0)20 550 1373 

Telephone No.: +31 (0)20 550 1316 

Email: joost.niessen@bnpparibas.com

Attention: Joost Niessen

 

Coöperatieve
Centrale Raiffeisen-Boerenleenbank B.A.

Rabobank Nederland

Trade Services UHP-4038

Gildenkwartier l99
 3511 DH Utrecht
 The Netherlands
 Facsimile No.: +31 3 216 6306
 Telephone No.: +31 (0)30 216 3200
 Email: middofficets@m.rabobank.nl
 Attention: Mid Office Trade Services

 

ABN
AMRO Bank N.V.

(GF 3050)
 P.O. Box 949
 3000 DD Rotterdam
 The Netherlands
 Facsimile No: +31 (0)10 402 5073
 Telephone No: +31 (0)20 535 9200
 Email: RSC.inquiry@nl.abnamro.com
 Attention: Mr. Barend Nout

 

Address
courier only
 ABN AMRO Bank N.V.
 (GF 3050) 5th Floor
 Aert van Nesstraat 45
 3012 CA Rotterdam
 The Netherlands
 Attention: Trade Processing Centre

 

 

 

EXHIBIT
A

 

FORM OF
ASSIGNMENT AND ACCEPTANCE

 

This Assignment
and Acceptance (the “Assignment and Acceptance”) is dated as of the
Effective Date (as defined below) and is entered into by and between the
Assignor (as defined below) and the Assignee (as defined below). Capitalized
terms used in this Assignment and Acceptance and not otherwise defined herein
shall have the meanings specified in the Secured Revolving Credit Agreement
dated as of September 29, 2006 (as amended, restated, supplemented or otherwise
modified, refinanced or replaced from time to time, the “Credit Agreement”),
among KASLION ACQUISITION B.V., NXP B.V. (the “Company”). NXP FUNDING
LLC, the lenders from time to time parties thereto (each a “Lender” and,
collectively, the “Lenders”), MORGAN STANLEY SENIOR FUNDING, INC., as
Administrative Agent and Global Collateral Agent, MORGAN STANLEY BANK
INTERNATIONAL LIMITED, DEUTSCHE BANK AG, LONDON BRANCH and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED, as Joint Lead Arrangers and Joint
Bookrunners, DEUTSCHE BANK AG, LONDON BRANCH, as Syndication Agent and MERRILL
LYNCH CAPITAL CORPORATION, as Documentation Agent.

 

The Standard Terms
and Conditions set forth in Annex 1 attached hereto are hereby agreed to and
incorporated herein by reference and made a part of this Assignment and
Acceptance as if set forth herein in full.

 

For an agreed
consideration, the Assignor hereby irrevocably sells and assigns to the
Assignee, and the Assignee hereby irrevocably purchases and assumes from the
Assignor, subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all the Assignor’s rights and
obligations in its capacity as a Lender under the Credit Agreement, the other
Credit Documents and any other documents or instruments delivered pursuant
thereto to the extent related to the amount and percentage interest identified
below of the Credit Facility identified below and (ii) to the extent permitted
to be assigned under applicable law, all claims, suits, causes of action and
any other right of the Assignor (in its capacity as a Lender) against any
Person, whether known or unknown, arising under or in connection with the
Credit Agreement and the other Credit Documents, any other documents or
instruments delivered pursuant thereto or the loan transactions governed
thereby or in any way based on or related to any of the foregoing, including
contract claims, tort claims, malpractice claims, statutory claims and all
other claims at law or in equity related to the rights and obligations sold and
assigned pursuant to clause (i) above (the rights and obligations sold and
assigned pursuant to clauses (i) and (ii) above being referred to herein
collectively as the “Assigned Interest”). Such sale and assignment is
without recourse to the Assignor and, except as expressly provided in this
Assignment and Acceptance, without representation or warranty by the Assignor.

 

A-1

 

1.                          Assignor
(the “Assignor”):                      

 

2.                          Assignee
(the “Assignee”):                      

 

3.                          Assigned
Interest:

 

	
  Total Commitment

  of all Lenders/Loans

  for all Lenders

  	
   

  	
  Amount of

  Commitment/

  Loans Assigned

  	
   

  	
  Percentage Assigned of

  Total Commitment/Loans

  of all Lenders (set forth,

  to at least 9 decimals,

  as a percentage of the,

  Total Commitment/Loans of

  all Lenders)

  	
   

  
	
  $

  	
   

  	
   

  	
   

  	
  [0.000000000

  	
  %]

  

 

4.         Effective Date of Assignment (the “Effective Date”:                ,
20   (1).

 

The terms set
forth in this Assignment and Acceptance are hereby agreed to:

 

	
   

  	
   

  	
  [NAME OF ASSIGNOR], as Assignor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [NAME OF ASSIGNEE], as Assignee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Accepted:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  MORGAN STANLEY SENIOR FUNDING, INC.,

  
	
   

  	
   

  	
  as Administrative Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
						

 

(1)       To
be inserted by Administrative Agent and which shall be the effective date of
recordation of the transfer in the Register.

 

A-2

 

	
   

  	
   

  	
  Consented to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NXP B.V

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:                                           ]

  

 

A-3

 

ANNEX 1

 

STANDARD TERMS AND CONDITIONS FOR 

ASSIGNMENT AND ACCEPTANCE

 

1.         Representations and Warranties and Agreements.

 

1.1       Assignor. The Assignor (a)
represents and warrants that (i) it is the legal and beneficial owner of the
Assigned Interest, (ii) the Assigned Interest is free and clear of any lien,
encumbrance or other adverse claim and (iii) it has full power and authority,
and has taken all action necessary, to execute and deliver this Assignment and
Acceptance and to consummate the transactions contemplated hereby and (b)
assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or any other
Credit Document, (ii) the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Documents or any collateral
thereunder, (iii) the financial condition of any of the Credit Parties, any of
their Subsidiaries or Affiliates or any other Person obligated in respect of
any Credit Document or (iv) the performance or observance by any of the Credit
Parties, any of their Subsidiaries or Affiliates or any other Person obligated
in respect of any Credit Document of any of their respective obligations under
any Credit Document.

 

1.2       Assignee. The Assignee (a)
represents and warrants that (i) it has full power and authority, and has taken
all action necessary, to execute and deliver this Assignment and Acceptance and
to consummate the transactions contemplated hereby and to become a Lender under
the Credit Agreement, (ii) it satisfies the requirements, if any, specified in
the Credit Agreement that are required to be satisfied by it in order to
acquire the Assigned Interest and become a Lender thereunder (including, if it
is a requirement of Dutch law, that it is a PMP), (iii) from and after the
Effective Date, it shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of
a Lender under the Credit Agreement, and (v) it has received a copy of the
Credit Agreement, together with copies of the most recent financial statements
delivered pursuant to Section 9.1 of the Credit Agreement, and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance and to
purchase the Assigned Interest on the basis of which it has made such analysis
and decision independently and without reliance on the Administrative Agent or
any other Lender and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the Assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Documents are
required to be performed by it as a Lender.

 

2.         Payments. From and after the
Effective Date, the Administrative Agent shall make all payments in respect of
the Assigned Interest (including payments of principal, interest, fees and
other amounts) to the Assignor for amounts which have accrued to but excluding
the Effective Date and to the Assignee for amounts which have accrued from and
after the Effective Date.

 

A-4

 

3.         General Provisions.

 

3.1       In accordance with
Section l3.17 of the Credit Agreement, upon execution, delivery,
acceptance and recording of this Assignment and Acceptance, from and after the
Effective Date, (a) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender under the Credit Agreement with a Commitment as set
forth herein and (b) the Assignor shall, to the extent of the Assigned Interest
assigned pursuant to this Assignment and Acceptance, be released from its
obligations under the Credit Agreement (and, in the case of this Assignment and
Acceptance covers all of the Assignor’s rights and obligations under the Credit
Agreement, the Assignor shall cease to be a party to the Credit Agreement.

 

3.2       This Assignment and Acceptance shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. This Assignment and Acceptance may be
executed by one or more of the parties to this Assignment and Acceptance on any
number of separate counterparts (including by facsimile or other electronic
transmission), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. This Assignment and Acceptance and the
rights and obligations of the parties hereunder shall be construed in accordance
with and governed by and interpreted under the law of the state of New York.

 

A-5

EXHIBIT B

 

NOTICE OF BORROWING

 

	
  Morgan Stanley Senior Funding, Inc.

  20 Cabot Square

  Canary Wharf

  London E14 4QW

  Attention: [         ]

  	
   

  	
  Date: [          ]

  

 

This Notice of
Borrowing is delivered pursuant to the Secured Revolving Credit Agreement dated
as of September 29, 2006 (as amended, the “Credit Agreement”) among KASLION
ACQUISITION B.V., NXP B.V., NXP FUNDING LLC, the lending institutions from time
to time parties thereto, and MORGAN STANLEY SENIOR FUNDING, INC., as
Administrative Agent. All capitalized terms used but not defined herein shall
have the meanings given in the Credit Agreement.

 

[KASLION
ACQUISITION B.V./ NXP B.V./NXP FUNDING LLC](2) (the “Borrower”) hereby
requests a Borrowing as follows:

 

	
  1.

  	
   

  	
  Amount of Borrowing:

  	
   

  	
  [                            ]
  (3)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Date of Borrowing:

  	
   

  	
  [                            ] (4)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Type of Borrowing:

  	
   

  	
  [ABR Loan] [LIBOR Loan] [EURIBOR Loan].

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Currency of Borrowing:

  	
   

  	
  [                            ] (5)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Interest Period:

  	
   

  	
                         month(s)(6)

  

 

The Borrower
certifies that on and as of the date of the proposed Borrowing and after giving
effect thereto:

 

(i)        no Default or Event of Default shall
have occurred and be continuing; and

 

(2)       Delete as appropriate.

 

(3)       Must be at least the applicable Minimum
Borrowing Amount.

 

(4)       Must be a Business Day.

 

(5)       Must be the Base Currency or an
Alternative Currency.

 

(6)       Applicable only to LIBOR Loans or EURIBOR
Loans.

 

B-1

 

(ii)       all representations and warranties made
by any Credit Party contained in the Credit Agreement or in the other Credit
Documents shall be true and correct in all material respects with the same
effect as though such representations and warranties had been made on and as of
the date of the Borrowing (except where such representations and warranties
expressly relate to an earlier date, in which case such representations and
warranties shall have been true and correct in all material respects as of said
earlier date).

 

	
   

  	
  [KASLION
  ACQUISITION B.V./ NXP

  B.V./NXP FUNDING LLC] (7)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

(7)       Delete as appropriate.

 

B-2

 

EXHIBIT C

 

LETTER OF CREDIT REQUEST

 

	
  Morgan Stanley Senior
  Funding, Inc. 

  20 Cabot Square 

  Canary Wharf 

  London E14 4QW 

  Attention:
  [             ]

  	
   

  	
  Date:
  [             ]

  

 

This Letter of
Credit Request is delivered pursuant to the Credit Agreement dated as of
September 29, 2006 (as amended, the “Credit Agreement”) among KASLION
ACQUISITION B.V. (“Holdings”), NXP B.V. (the “Company”), NXP
FUNDING LLC, (the “Co-Borrower”), the lenders from time to time parties
thereto (each a “Lender” and, collectively, the “Lenders”),
MORGAN STANLEY SENIOR FUNDING, INC., as Administrative Agent (in such capacity,
the “Administrative Agent”). All capitalized terms used but not defined
herein shall have the meanings given in the Credit Agreement.

 

[KASLION
ACQUISITION B.V./NXP B.V./NXP FUNDING LLC](8), (the “Borrower”) hereby
irrevocably requests the issuance of a Letter of Credit as follows:

 

	
  1.

  	
   

  	
  Requested Date of Issuance:
  [                ]
  (9)

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Initial Stated Amount and currency: [                ] (10),(11)

  
	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Expiration Date: [                ] (12)

  

 

The Borrower
certifies that on and as of the date of the proposed Credit Event and after
giving effect thereto:

 

(i)        no Default or Event of Default shall
have occurred and be continuing; and

 

(ii)       all representations and warranties made
by any Credit Party contained in the Credit Agreement or in the other Credit
Documents shall be true and correct in all material respects with the same
effect as though such representations and warranties had been made on and as of
the date of the Credit Event (except where such representations and warranties

 

(8)                   Delete as
appropriate.

 

(9)                   Must be a
Business Day.

 

(10)            Must be at least the
applicable minimum Borrowing Amount.

 

(11)            Must be the Base
Currency or an Alternative Currency.

 

(12)            Must be not more than
12 months after the issue date.

 

C-1

 

expressly relate to an
earlier date, in which case such representations and warranties shall have been
true and correct in all material respects as of said earlier date).

 

	
   

  	
  [KASLION ACQUISITION
  B.V./ NXP

  B.V./NXP FUNDING LLC](13)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

(13)            Delete as appropriate.

 

C-2

 

EXHIBIT D-l

 

SEPTEMBER 29, 2006 

[Insert Name of Company] 

OFFICER’S CERTIFICATE

 

I,                     ,
hereby certify that I am the duly elected, qualified and acting [President/Vice President/Secretary/Assistant
Secretary]  of [Insert
Name of Company] (the “Company”), and am authorized to execute this
Certificate on behalf of the Company. Reference is made to the Secured
Revolving Credit Agreement (the “Credit Agreement”), dated as of
September 29, 2006, among KASLION ACQUISITION B.V., PHILIPS SEMICONDUCTORS
INTERNATIONAL B.V, NXP FUNDING LLC, MORGAN STANLEY SENIOR FUNDING, INC., as
Administrative Agent and Global Collateral Agent, MORGAN STANLEY BANK
INTERNATIONAL LIMITED, DEUTSCHE BANK AG, LONDON BRANCH and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED, as Joint Lead Arrangers and Joint
Bookrunners, DEUTSCHE BANK AG, LONDON BRANCH as Syndication Agent, MERRILL
LYNCH CAPITAL CORPORATION, as Documentation Agent and the Lenders party
thereto. All capitalized terms used herein and not otherwise defined are used
as defined in the Credit Agreement.

 

Solely in my
capacity as [President/Vice
President/Secretary/Assistant Secretary]  of the Company, I hereby certify that:

 

1.                        Attached
as Annex A hereto is a true, correct, and complete copy of the organizational
documents of the Company.

 

2.                        Attached
as Annex B hereto is a true, correct, and complete copy of the bylaws or
equivalent of the Company, including all amendments, as in effect on the date
hereof, and, to the extent required, an extract of the trade register of the
Company.

 

3.                        Attached
as Annex C hereto are true, correct, and complete copies of resolutions duly
adopted by the Board of Directors of the Company authorizing the execution,
delivery and performance of the Credit Documents (and any agreements relating
thereto) to which it is a party. Such resolutions have not been modified or
rescinded and remain in full force and effect as of the date hereof.

 

4.                        Attached
as Annex D hereto are true, correct, and complete copies of resolutions duly
adopted by the Shareholders of the Company authorizing the execution, delivery
and performance of the Credit Documents (and any agreements relating thereto)
to which it is a party. Such resolutions have not been modified or rescinded
and remain in full force and effect as of the date hereof.

 

5.                        Attached
as Annex E hereto is a copy of the [Certificate of Good Standing] for the
Company certified by [relevant authority].

 

D-1-1

 

6.                        The
persons whose names appear on Annex F attached hereto are duly elected,
qualified and acting officers of the Company occupying the offices set forth
below their respective names on Annex F, and the signatures set forth above
their respective names are their true signatures, and each such officer is duly
authorized to execute and deliver on behalf of the Company the Credit Documents
and any other document delivered prior to the date hereof in connection with
the Credit Documents and to act as an Authorized Officer on behalf of the
Company under such Credit Documents.

 

D-1-2

 

IN WITNESS
WHEREOF, the undersigned has executed this Certificate as of the date first
written above.

 

	
   

  	
   

  	
  [Company]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

The undersigned, being
the duly elected and qualified[President/Vice
President/Secretary/Assistant Secretary]of  the Company, hereby certifies that [name] is the duly
elected and qualified [President/Vice
President/Secretary/Assistant Secretary]  of the Company and that the foregoing signature appearing
above his name is his genuine signature.

 

IN WITNESS
WHEREOF, I have hereunto set my hand on behalf of the Corporations as of the
date first written above.

 

 

	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

D-1-3

 

Annex A

 

D-1-4

 

Annex B

 

D-1-5

 

Annex C

 

D-1-6

 

Annex D

 

D-1-7

 

Annex E

 

D-1-8

 

Annex F

 

D-1-9

 

EXHIBIT D-2

 

SEPTEMBER
29, 2006

NXP B.V.

OFFICER’S CERTIFICATE

 

I,                    ,
hereby certify that I am the duly elected, qualified and acting [Authorized Officer] of NXP B.V. (the “Company”),
and am authorized to execute this Certificate on behalf of the Company.
Reference is made to the Secured Revolving Credit Agreement (the “Credit
Agreement”), dated as of September 29, 2006, among KASLION ACQUISITION
B.V., NXP B.V, NXP FUNDING LLC, MORGAN STANLEY SENIOR FUNDING, INC., as
Administrative Agent and Global Collateral Agent, MORGAN STANLEY BANK
INTERNATIONAL LIMITED, DEUTSCHE BANK AG, LONDON BRANCH and MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED, as Joint Lead Arrangers and Joint
Bookrunners, DEUTSCHE BANK AG, LONDON BRANCH as Syndication Agent, MERRILL
LYNCH CAPITAL CORPORATION, as Documentation Agent and the Lenders party
thereto. All capitalized terms used herein and not otherwise defined are used
as defined in the Credit Agreement.

 

Solely in my
capacity as [Authorized Officer]
of the Company, I hereby certify that:

 

1.                        No
Indebtedness or financing preferred stock of Holdings or its Subsidiaries to
third parties will be outstanding following the Closing Date.

 

2.                        No
shareholder loans have been made without the consent of the Joint Lead
Arrangers, other than (i) Indebtedness pursuant to Credit Agreement, (ii) the
Bridge Facilities, (iii) the Senior Notes, (iv) Indebtedness outstanding on
August 3, 2006, and (v) other Indebtedness not exceeding €50,000,000.

 

3.                        I have
reviewed the audited financial statements of the Company and as at December 31,
2005 and the unaudited consolidated balance sheets of the Company and the
semiconductors business of the Seller as at June 30, 2006 referred to in
Section 8.9(a) and 8.9(b) respectively of the Credit Agreement (the “Financial
Statements”). I am familiar with the financial performance and prospects of
the Company and hereby confirm that as of the date hereof, after giving effect
to the transactions contemplated by the Credit Documents:

 

i.                             The
fair value of the assets of Holdings and its Subsidiaries on a consolidated
basis, at a fair valuation, exceeds the debts and liabilities, direct,
subordinated, contingent or otherwise, of Holdings and its Subsidiaries on a
consolidated basis, respectively.

 

ii.                          The
present fair saleable value of the property of Holdings and its Subsidiaries on
a consolidated basis is greater than the amount that is required to pay the
probable liability of Holdings and its Subsidiaries on a consolidated basis on
their debts

 

D-2-1

 

and other liabilities,
direct, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured.

 

iii.                       Holdings
and its Subsidiaries on a consolidated basis are able to pay their debts and
liabilities, direct, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured.

 

iv.                      Holdings and
its Subsidiaries on a consolidated basis do not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted following the
Closing Date.

 

v.                         Each
Credit Party has not ceased, and does not expect that it will cease, making
payments on its liabilities when due.

 

vi.                      Each Credit
Party can, and expects that it can, obtain credit in the ordinary course of
business.

 

vii.                   No Credit Party
intends to, and does not believe that it or any of the Restricted Subsidiaries
will, incur debts beyond its ability to pay such debts as they mature, taking
into account the timing and amounts of cash to be received by it or any such
Subsidiary and the timing and amounts of cash to be payable on or in respect of
its Indebtedness or the Indebtedness of any such Subsidiary.

 

D-2-2

 

IN WITNESS
WHEREOF, the undersigned has executed this Certificate as of the date first
written above.

 

 

	
   

  	
  NXP B.V.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
				

 

D-2-3

 

EXHIBIT E 

 

FORM OF PROMISSORY NOTE

 

$                                                                                                                                                       ,
                                           

 

FOR VALUE
RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to the
order of [LENDER] (the “Lender”), on the Maturity Date (as defined in
the Credit Agreement referred to below) the principal amount of                           ,
or such lesser principal amount of Loans (as defined in such Credit Agreement)
due and payable by the Borrower to the Lender on the Maturity Date under that
certain Credit Agreement dated as of September 29, 2006 (as amended, the
“Credit Agreement”) among KASLION ACQUISITION B.V. (“Holdings”), NXP
B.V. (the “Company”), NXP FUNDING LLC (the “Co-Borrower”), the
lending institutions from time to time parties thereto (each a “Lender”
and, collectively, the “Lenders”), MORGAN STANLEY SENIOR FUNDING, INC.,
as Administrative Agent (the terms defined therein being used herein as therein
defined).

 

The Borrower
promises to pay interest on the unpaid principal amount of each Loan from the
date of such Loan until such principal amount is paid in full, at such interest
rates, in the currency, in the manner and at such times as are specified in the
Credit Agreement. All payments of principal and interest shall be made to the
Lender in immediately available funds at the Lender’s lending office. If any
amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per annum
rate set forth in the Credit Agreement.

 

This Note is the
promissory note referred to in Section 13.7(d) of the Credit Agreement, and is
a “Credit Document” for the purposes of the Credit Agreement and entitled to
the benefits thereof and is subject to optional and mandatory prepayment in
whole or in part as provided in the Credit Agreement. This Note is also
entitled to the benefits of the Guaranty. Upon the occurrence and continuation
of one or more of the Events of Default specified in the Agreement, all amounts
then remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Credit Agreement. Loans made
by the Lender shall be evidenced by one or more loan accounts or records
maintained by the Lender in the ordinary course of business. The Lender may
also attach schedules to this Note and endorse thereon the date, amount and
maturity of the Loans and payments with respect thereto.

 

E-1

 

The Borrower, for
itself, its successors and assigns, hereby waives diligence, presentment,
protest and demand and notice of protest, demand, dishonor and non-payment of
this Note.

 

E-2

 

THIS NOTE SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

 

	
   

  	
   

  	
   

  	
  [BORROWER]

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
  Name

  	
   

  
	
   

  	
   

  	
   

  	
  Title

  	
   

  
								

 

E-3

 

EXECUTION VERSION

 

AMENDMENT
NO. 1 TO SECURED REVOLVING CREDIT AGREEMENT

 

 

AMENDMENT dated as
of October 12, 2006 (the “Amendment”) among KASLION ACQUISITION B.V.
with its corporate seat in Amsterdam, the Netherlands (“Holdings”), NXP
B.V. with its corporate seat in Eindhoven, the Netherlands (the “Company”),
NXP FUNDING LLC (the “Co-Borrower”), the Lenders party hereto and MORGAN
STANLEY SENIOR FUNDING, INC., as Administrative Agent (in such capacity, the “Administrative
Agent”).

 

WHEREAS, the
Borrowers, the Lenders, the Administrative Agent, Morgan Stanley Senior
Funding, Inc., as Global Collateral Agent, Morgan Stanley Bank International
Limited, Deutsche Bank AG, London Branch and Merrill Lynch, Pierce, Fenner
& Smith Incorporated, as Joint Lead Arrangers and Joint Bookrunners,
Deutsche Bank AG, London Branch, as Syndication Agent and Merrill Lynch Capital
Corporation, as Documentation Agent, are parties to the Secured Revolving
Credit Agreement dated as of September 29, 2006 (the “Credit Agreement”);
and

 

WHEREAS, the
Borrowers and the Lenders have agreed to amend the Credit Agreement with effect
on and from the Effective Date subject to and upon the terms and conditions set
forth herein.

 

NOW, THEREFORE, in
consideration of the premises and the covenants and agreements contained
herein, the parties hereto hereby agree as follows:

 

Section 1. Definitions
and Interpretations. Unless the context requires otherwise, terms used
herein have the respective meanings given in the Credit Agreement.

 

Section 2. Amendments
to Section 1.1 of the Credit Agreement. (a) Clause (h) of the definition of
“Asset Disposition” in Section 1.1 of the Credit Agreement is hereby amended by
inserting the words “other than sales of securities or indebtedness of SSMC so
long as it is not a Restricted Subsidiary” after the words “asset sales”.

 

(b) Clause (n) of
the definition of “Asset Disposition” in Section 1.1 of the Credit Agreement is
hereby amended by inserting “(x) SSMC and (y)” after the words “with the
exception of”.

 

(c) Clause (a) of
the definition of “Board of Directors” in Section 1.1 of the Credit Agreement
is hereby amended by inserting “(x) for the purposes of the definition of
Change of Control only, its managing board or supervisory board and (y) for all
other purposes,” after the words “laws of the Netherlands,”.

 

(d) Clause (a) of
the definition of “Consolidated Net Income” in Section 1.1 of the Credit
Agreement is hereby amended by inserting the words “(except in the case of SSMC
so long as it is not a Restricted Subsidiary, but this exception shall only
apply for the purpose of

 

 

determining the amount
available for Restricted Payments (other than Restricted Investments) under
Section 10.2(c)(i))” after the words “return on investment or”.

 

(e) The definition
of “SSMC” in Section 1.1 of the Credit Agreement is hereby amended by adding
the following sentence immediately after the end of the first sentence:

 

“For
purposes of Section 10.2 and the definition of “Asset Disposition”, references
to SSMC shall also refer to any Unrestricted Subsidiary (x) any Capital Stock
or debt of which is owned directly or indirectly by SSMC or (y) which has
received a cash distribution or dividend from SSMC.”

 

Section 3. Amendments
to Section 10.2 of the Credit Agreement. (a) Section 10.2(a)(iv)(C)(4)(b)
of the Credit Agreement is hereby amended by (i) inserting the words “(other
than SSMC)” after the words “redesignation of Unrestricted Subsidiaries” and
(ii) inserting the words “referred to in the first sentence of this sub-clause
(C)” after the words “the amount of Restricted Payments”.

 

(b) Section
10.2(a)(iv)(C)(5) of the Credit Agreement is hereby amended by (i) in
sub-paragraph (a), inserting the words “(other than SSMC)” after the words
“Unrestricted Subsidiary of the Company”, (ii) in sub-paragraph (b), inserting
the words “(other than SSMC)” after the words “Unrestricted Subsidiary or
Affiliate”, and (iii) in the proviso, inserting the words “referred to in the
first sentence of this sub-clause (C)” after the words “the amount of
Restricted Payments”.

 

(c) Section
10.2(c)(xviii) of the Credit Agreement is hereby amended by inserting the words
“other than SSMC” after the words “Capital Stock of Unrestricted Subsidiaries”.

 

(d) Section 10.2
of the Credit Agreement is hereby amended by inserting new clause (e) as
follows:

 

“(e)
In addition to the foregoing, it will be a breach of this Section 10.2 if any
of the Initial Investors receives directly or indirectly from SSMC payments
that would, if made by the Company, constitute Restricted Payments of the types
described in clauses (a)(i) to (iii) above (inclusive), other than through
distributions and dividends (x) to the Company and the making of such payments
by the Company in a manner permitted by the covenant set forth above or (y) on
a pro rata basis (proportionate to its ownership of SSMC) to another portfolio
company of any Initial Investor, or, in the case of the Seller, another
operating subsidiary, engaged in an active business that owns Capital Stock of
SSMC at such time.”

 

Section 4. Amendments
to Section 13.7 of the Credit Agreement. Section 13.7(b)(i)(B) of the
Credit Agreement is hereby deleted and replaced with the following:

 

“(B)
the Administrative Agent and the Letter of Credit Issuers (in each case, which
consent shall not be unreasonably withheld or delayed), provided that

 

2

 

no consent of the
Administrative Agent or any Letter of Credit Issuer shall be required for (x)
an assignment of any Commitment to an assignee that is a Lender, except for the
consent of each Specified LC Issuer (such consent not to be unreasonably
withheld or delayed) unless the assignee Lender of such Commitment has a
corporate rating of at least “A+” from S&P or a corporate family rating of at
least “Al” from Moody’s or has its obligations unconditionally and irrevocably
guaranteed by an entity with such rating or (y) any Loan to a Lender, an
Affiliate of a Lender, an Agent or an Affiliate of an Agent or an Approved
Fund. As used in this sub-clause (B), “Specified LC Issuer” means Coöperatieve
Centrale Raiffeisen-Boerenleenbank B.A. or any of its Affiliates that may from
time to time be a Letter of Credit Issuer hereunder.

 

Section 5. Representations
of Borrowers. Each Borrower represents and warrants that (a) the
representations and warranties of such Borrower set forth in Section 8 of the
Credit Agreement are true and correct in all material respects with the same
effect as though such representations and warranties had been made on and as of
the Effective Date and (b) no Default or Event of Default shall have occurred
and be continuing on and as of the Effective Date.

 

Section 6. Conditions
to Effectiveness. This Amendment shall become effective on the date (the “Effective
Date”) on which the Administrative Agent shall have received from each of
the Borrowers and the Required Lenders a counterpart hereof signed by such
party or facsimile or other written confirmation (in form satisfactory to the
Administrative Agent) that such party has signed a counterpart hereof. The
Administrative Agent shall promptly notify the Lenders and the Company of the
occurrence of the Effective Date.

 

Section 7. Miscellaneous.
(a) Except to the extent expressly amended hereby, the Credit Agreement and
each of the other Credit Documents remain in full force and effect and are
hereby ratified and affirmed.

 

(b) This Amendment
shall be limited precisely as written and shall not be deemed (i) to be a
consent granted pursuant to, or a waiver or modification of, any other term or
condition of the Credit Agreement, any other Credit Document or any of the
instruments or agreements referred to therein or (ii) to prejudice any right or
rights which the Agents or the Lenders may now have or have in the future under
or in connection with the Credit Agreement, any other Credit Document or any of
the instruments or agreements referred to therein.

 

(c) On and from
the Effective Date whenever the “Agreement” or the “Credit Agreement” is
referred to in the Credit Agreement, any other Credit Document or any of the
instruments, agreements or other documents or papers executed or delivered in
connection therewith, such reference shall be deemed to mean the Credit
Agreement as modified by this Amendment.

 

Section 8. Governing
Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND

 

3

 

CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.

 

Section 9. Counterparts.
This Amendment may be executed by one or more of the parties to this Amendment
on any number of separate counterparts (including by facsimile or other
electronic transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.

 

4

 

IN WITNESS
WHEREOF, each of the parties hereto has caused a counterpart of this Amendment
to be duly executed and delivered as of the date first above written.

 

 

	
   

  	
  BORROWERS 

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  KASLION ACQUISITION
  B.V.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name: Illegible

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

AMENDMENT NO. 1 TO
SECURED REVOLVING CREDIT AGREEMENT

 

 

	
   

  	
  NXP
  B.V.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

	
   

  	
  NXP
  FUNDING LLC

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

AMENDMENT NO. 1 TO
SECURED REVOLVING CREDIT AGREEMENT

 

 

	
   

  	
  ADMINISTRATIVE
  AGENT

  
	
   

  	
   

  
	
   

  	
  MORGAN STANLEY SENIOR 

  
	
   

  	
  FUNDING, INC.,

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mathias Blumschein

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  MORGAN STANLEY SENIOR 

  
	
   

  	
  FUNDING, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  LENDERS

  
	
   

  	
   

  
	
   

  	
  MERRILL LYNCH CAPITAL

  
	
   

  	
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephanie Vallillo

  	
   

  
	
   

  	
   

  	
  Name: Stephanie
  Vallillo

  
	
   

  	
   

  	
  Title: Vice President

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  DEUTSCHE BANK AG,
  LONDON 

  
	
   

  	
  BRANCH

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ N Jansa

  	
   

  
	
   

  	
   

  	
  Name: N JANSA

  
	
   

  	
   

  	
  Title: MD

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name: [Illegible]

  
	
   

  	
   

  	
  Title: Managing
  Director

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  MIZUHO CORPORATE BANK,
  LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name: [Illegible]

  
	
   

  	
   

  	
  Title: Director

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.E. Fowler

  	
   

  
	
   

  	
   

  	
  Name: J.E. FOWLER

  
	
   

  	
   

  	
  Title: VICE PRESIDENT

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  ABN AMRO BANK N.V.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Edwin Ezinga

  	
   

  
	
   

  	
   

  	
  Name: EDWIN EZINGA

  
	
   

  	
   

  	
  Title: ASSISTANT
  DIRECTOR

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  BNP PARIBAS, AMSTERDAM 

  
	
   

  	
  BRANCH

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.A.C. Niessen    /s/ P. van der
  Velden

  	
   

  
	
   

  	
   

  	
  Name: J.A.C. NIESSEN    P. van der
  VELDEN

  
	
   

  	
   

  	
  Title: [Illegible]

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  HSBC BANK PLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name: [Illegible]

  
	
   

  	
   

  	
  Title: Global
  Relationship Manager

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit Agreement

 

 

	
   

  	
  COÖPERATIEVE CENTRALE 

  
	
   

  	
  RAIFFEISEN-

  
	
   

  	
  BOERENLEENBANK B.A.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Illegible    /s/ Illegible

  	
   

  
	
   

  	
   

  	
  Name: [Illegible]     [Illegible]

  
	
   

  	
   

  	
  Title:

  

 

Signature Page to
Amendment No. 1 to the Secured Revolving Credit AgreementExhibit 10.2

 

Execution
Version

 

SHAREHOLDERS
AGREEMENT

 

among

 

KASLION
Holding B.V.,

 

Koninklijke
Philips Electronics N.V.,

 

KASLION
Acquisition B.V.,

 

Stichting
Management Co-Investment NXP

 

and

 

NXP B.V.

 

Dated as
of September 29, 2006

 

 

 

TABLE OF CONTENTS

 

	
   

  	
  ARTICLE I 

  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  1.1.

  	
  Certain Defined Terms

  	
  2

  
	
  Section
  1.2.

  	
  Other Terms 

  	
  10

  
	
  Section
  1.3.

  	
  Other Definitional Provisions

  	
  10

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE II

  CORPORATE GOVERNANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  2.1.

  	
  Corporate Governance Principles

  	
  11

  
	
  Section
  2.2.

  	
  Initial Composition of Newco and NXP Boards; Board
  Committees

  	
  11

  
	
  Section
  2.3.

  	
  Philips Ongoing Rights with Respect to Newco and NXP
  Boards

  	
  12

  
	
  Section
  2.4.

  	
  Governance Rights 

  	
  13

  
	
  Section
  2.5

  	
  Organizational Documents

  	
  16

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE III 

  TRANSFER OF SHARES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  3.1.

  	
  Transfer Restrictions

  	
  16

  
	
  Section
  3.2.

  	
  Permitted Transfers

  	
  16

  
	
  Section
  3.3.

  	
  “Drag-Along” Rights

  	
  18

  
	
  Section
  3.4.

  	
  “Philips Tag-Along” Rights

  	
  20

  
	
  Section
  3.5.

  	
  Excluded Transactions

  	
  23

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE IV 

  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  4.1.

  	
  Power and Authority; Valid and Binding Obligations;
  No Conflict or Violation

  	
  23

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE V 

  FINANCIAL REPORTING AND ACCOUNTING

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  5.1.

  	
  Provision of Information by Newco to Philips

  	
  24

  
	
  Section
  5.2.

  	
  Auditors and Audits; Annual and Quarterly Statements
  and Accounting

  	
  25

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE VI 

  CONFIDENTIALITY

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  6.1.

  	
  Confidentiality

  	
  26

  
	
  Section
  6.2.

  	
  Information

  	
  27

  

 

i

 

	
  Section
  6.3.

  	
  CFC

  	
  27

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE VII 

  REGISTRATION OF SUBJECT SECURITIES

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  7.1.

  	
  Demand Registration Rights

  	
  28 

  
	
  Section
  7.2.

  	
  Piggyback Registration Rights

  	
  30

  
	
  Section
  7.3.

  	
  Offer Procedures

  	
  32

  
	
  Section
  7.4.

  	
  Expenses

  	
  35

  
	
  Section
  7.5.

  	
  Indemnification

  	
  35

  
	
  Section
  7.6.

  	
  No Shareholder Consent Necessary to Conduct a Public
  Offering

  	
  38

  
	
   

  	
   

  	
   

  
	
   

  	
  ARTICLE VIII 

  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section
  8.1.

  	
  Termination

  	
  38

  
	
  Section
  8.2.

  	
  Additional Securities

  	
  38

  
	
  Section
  8.3.

  	
  Notices

  	
  39

  
	
  Section
  8.4.

  	
  Amendment; Waiver

  	
  45

  
	
  Section
  8.5.

  	
  No Assignment or Benefit to Third Parties

  	
  45 

  
	
  Section
  8.6.

  	
  Entire Agreement

  	
  46

  
	
  Section
  8.7.

  	
  Dispute Resolution 

  	
  46

  
	
  Section
  8.8.

  	
  Governing Law; Submission to Jurisdiction; Selection
  of Forum; Waiver of Trail by Jury

  	
  46

  
	
  Section
  8.9. 

  	
  Counterparts            

  	
  47

  
	
  Section
  8.10. 

  	
  Headings

  	
  47

  
	
  Section
  8.11.

  	
  Severability

  	
  47

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULES

  	
   

  
	
   

  	
   

  	
   

  
	
  Schedule
  1

  	
   

  	
  Signature Page for Additional Parties

  	
   

  
	
  Schedule
  2

  	
   

  	
  Newco Articles of Association

  	
   

  

 

ii

 

This SHAREHOLDERS
AGREEMENT is made as of the 29th day of September 2006 among KASLION
Holding B.V., a limited liability company organized under the laws of The
Netherlands (“Investor”), Koninklijke Philips Electronics N.V., a
limited liability company organized under the laws of The Netherlands (“Philips”).
KASLION Acquisition B.V., a limited liability company organized under the laws
of The Netherlands (“Newco”), Stichting Management Co-Investment NXP, a
foundation organized under the laws of The Netherlands (the “Stichting
Management”), and NXP B. V., a limited liability company organized under
the laws of The Netherlands (“NXP”).

 

WHEREAS, Newco is
a limited liability company duly organized under the laws of The Netherlands
which, prior to the closing of the Subscription Agreement (as defined below),
has an issued share capital of 18 ordinary shares, par value €1,000 per share;

 

WHEREAS, Philips,
NXP and Newco have entered into a Stock Purchase Agreement, dated as of
September 28, 2006 (the “Stock Purchase Agreement”), pursuant to which
Newco will acquire all of the common equity of NXP from Philips;

 

WHEREAS, Newco,
Philips, Investor and Stichting Management have entered into a Subscription
Agreement, dated as of September 28, 2006 (the “Subscription Agreement”),
pursuant to which Philips, Investor and Stichting Management will make capital
contributions to Newco in connection with Newco’s acquisition of all of the
outstanding shares of NXP from Philips;

 

WHEREAS, following
the amendment of Newco’s Articles of Associations and the funding of the
capital contributions pursuant to the Subscription Agreement, Investor, Philips
and Stichting Management shall become the shareholders of Newco (the “Shareholders”),
with Investor owning 70.488% of the then-outstanding ordinary Shares and 80.1%
of the Company’s then-outstanding cumulative preferred Shares, Philips owning
17.512% of the then-outstanding ordinary Shares and 19.9% of the
then-outstanding cumulative preferred shares and Stichting Management owning
12.0% of the then-outstanding ordinary Shares; and

 

WHEREAS, Stichting
Management may from time to time sell and transfer Shares to one or more
appropriate vehicles designated by Investor and managed by one or more
representatives of Investor or certain directors or employees of NXP or its
Subsidiaries for the benefit of certain of the directors, officers and
employees of NXP and its Subsidiaries, which, upon execution of a copy of
Schedule 1 and receipt of such Shares, would become Parties to this Agreement
(together with Stichting Management, the “Management Trusts”); and

 

WHEREAS, the
Shareholders, Newco, NXP and the Management Trust desire to enter into certain
agreements relating to the Shares, Newco and NXP;

 

NOW, THEREFORE, in
consideration of the foregoing, and the mutual rights and obligations set forth
below, the Parties agree as follows:

 

 

ARTICLE
I 

DEFINITIONS

 

Section 1.1. Certain
Defined Terms. As used in this Agreement, the following terms shall have
the following meanings:

 

“Additional
Securities” means Equity Securities of Newco other than Equity Securities
issued in connection with the IPO.

 

“Advisors”
has the meaning set forth in Section 7.3(a)(vi).

 

“Affiliate”
means, with respect to any Person, any Person directly or indirectly
controlling, controlled by or under common control with such other Person as of
the date on which, or at any time during the period for which, the
determination of affiliation is being made. For purposes of this definition,
the term “control” (including the correlative meanings of the terms “controlled
by” and ‘“under common control with”), as used with respect to any Person,
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

 

“Affiliate
Transaction” means a transaction between Newco, NXP or any of their
respective Subsidiaries, on the one hand, and Investor or an Investor
Affiliate, on the other hand, except for routine commercial transactions
entered into on an arm’s length basis in the ordinary course of business with
an Investor Affiliate (which routine commercial transactions, for the avoidance
of doubt, shall include the payment of any customary and reasonable management
or similar fees not exceeding in total EUR 2 million per annum by Newco, NXP
and any of their respective Subsidiaries to all Investor Affiliates, provided a
separate annual payment is made to Philips in an amount equal to the amount of
any such management and similar fees multiplied by a fraction the numerator of
which is Philips’s then percentage of ownership of Shares and the denominator
of which is the then percentage of the Investor’s ownership of Shares.

 

“AFM” means
the Stichting Autoriteit Financiele Markten of The Netherlands or such other
regulator as shall be serving as competent authority of The Netherlands for
purposes of the Prospectus Directive.

 

“Agreement”
means this Shareholders Agreement, including all Schedules thereto, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with the terms hereof.

 

“Applicable
Regulatory Requirements” has the meaning set forth in Section 5.1 (a).

 

“Blackout
Period” has the meaning set forth in Section 7.1 (e)(i).

 

“Board”
means board of directors, management board or supervisory board, or such other
governing body, committee or position, such as manager or trustee, that entails
responsibility for management and direction of any Person.

 

2

 

“Cash
Equivalents” shall mean any of the following: (a) direct obligations of the
United States of America, the United Kingdom or the European Union, or
obligations of any governmental agency of the United States of America, the
United Kingdom or the European Union, with a maturity of one year or less; (b)
commercial paper having a rating from S&P, of at least A-l or from Moody’s
of at least P-l; (c) certificates of deposit and other time deposits issued by
any bank or trust company having capital surplus and undivided profits of at
least $500 million, and whose long-term unsecured indebtedness is rated at
least A- by S&P or at least A3 by Moody’s; and (d) repurchase agreements
with respect to (and secured by a pledge of) securities described in clause (a)
above and entered into with any commercial bank that meets the requirements set
out in clause (c) above or any securities broker-dealer of national standing in
the United States of America or in any member state of the European Union.

 

“Cause” has
the meaning set forth in Section 2.3(c).

 

“Chairman”
has the meaning set forth in Section 2.1.

 

“Chosen Courts”
has the meaning set forth in Section 8.8.

 

“Closing”
has the meaning given to it in the Stock Purchase Agreement.

 

“Closing Date”
has the meaning given to it in the Stock Purchase Agreement.

 

“Confidential
Information” has the meaning set forth in Section 6.1.

 

“Demand Request”
has the meaning set forth in Section 7.1 (a).

 

“Demanding
Shareholder” has the meaning set forth in Section 7.1 (a).

 

“Disputes”
has the meaning set forth in Section 8.7.

 

“EB1TDA”
means consolidated net income plus, to the extent that they have been deducted
in arriving at consolidated net income, (a) depreciation and amortization
expenses, (b) non-recurring restructuring expenses, charges and losses, (c)
financial expenses, (d) income tax expense, (e) losses relating to
unconsolidated companies, (f) minority interests, (g) loss from discontinued
operations, (h) loss from the cumulative effect of changes in accounting
principles (net of tax) and (i) loss from extraordinary items minus, to the
extent they have been added in arriving at consolidated net income, (a)
financial income, (b) any credit for income taxes, (c) results relating to
unconsolidated companies (including any net dilution gains), (d) minority
interests, (e) discontinued operations, (f) the cumulative effect of changes in
accounting principles (net of tax), (g) gains from extraordinary items and (h)
any aggregate net gain (but not any aggregate net loss) from the sale, exchange
or other disposition of capital assets.

 

“Equity
Securities” means any shares of any class or series or any securities
(including debt securities) convertible into or exercisable or exchangeable for
shares of any class or series of capital stock of any Person (or which are
convertible into

 

3

 

or exercisable or
exchangeable for another security which is, in turn, convertible into or
exercisable or exchangeable for shares of any class or series of capital stock,
of such Person), whether now authorized or not.

 

“EU Prospectus”
shall mean a prospectus with respect to a Public Offering within the European
Union approved and published under the Prospectus Directive or a prospectus
exempt from the approval requirements of the Prospectus Directive pursuant to
the national implementing legislation of the IPO Entity’s Home Member State, in
each case as amended or supplemented by any supplement thereto and including
all material incorporated therein.

 

“Executive
Period” has the meaning set forth in Section 8.7(d).

 

“Facilities”
means the Debt Financing as defined in the Stock Purchase Agreement and NXP’s
senior revolving credit facility that is in effect on the Closing Date.

 

“Fixed Charge
Coverage Ratio” means, as of any date, the ratio of (a)EBITDA for the four
consecutive fiscal quarters immediately preceding such date divided by (b)
Fixed Charges for the current fiscal quarter and three consecutive fiscal
quarters immediately succeeding such date.

 

“Fixed Charges”
means, for any period, the sum (without duplication) of (a) consolidated cash
interest expense, including pro forma cash interest expense of any debt or
other obligation to be incurred, and (b) scheduled amortization payments of
principal in respect of consolidated total debt, excluding any final payment of
principal at maturity of any such debt, minus (c) consolidated cash interest
income.

 

“Governmental
Authority” means any federal, state or local court, administrative body or
other governmental or quasi-governmental entity with competent jurisdiction.

 

“Holdco”
has the meaning set forth in Section 3.3 and Section 3.4.

 

“Home Member
State” means the home member state of the IPO Entity, as determined under
the Prospectus Directive with respect to a Public Offering.

 

“Indemnified
Party” has the meaning set forth in Section 7.5(d).

 

“Indemnifying
Party” has the meaning set forth in Section 7.5(d).

 

“Information”
means information, whether or not patentable or copyrightable, in written,
oral, electronic or other tangible or intangible forms, stored in any medium,
including studies, reports, records, books, contracts, instruments, surveys,
discoveries, ideas, concepts, know-how, techniques, designs, specifications,
drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data,
computer data, disks, diskettes, tapes, computer programs or other software,
marketing plans, customer names, 
communications  by  or to 
attorneys  (including  attorney-client  privileged

 

4

 

communications), memos
and other materials prepared by attorneys or under their direction (including
attorney work product), and other technical, financial, employee or business
information or data.

 

“Initial
Chairman” has the meaning set forth in Section 2.2.

 

“Initial
Directors” has the meaning set forth in Section 2.2.

 

“Initial
Managers” has the meaning set forth in Section 2.2.

 

“Initial
Meeting” has the meaning set forth in Section 2.2.

 

“Initial
Members” has the meaning set forth in Section 2.2.

 

“Initiating
Notice” has the meaning set forth in Section 8.7(a).

 

“Initiator”
has the meaning set forth in Section 8.7.

 

“IFRS”
means International Financial Reporting Standards.

 

“Investor
Affiliate” means any Affiliate of Investor or of a direct or indirect
shareholder of Investor, including limited and general partners, investment
managers and any of their respective Affiliates.

 

“Investor”
has the meaning set forth in the Preamble.

 

“Investor
Equity Commitment Letters” has the meaning set forth in the Stock Purchase
Agreement.

 

“Investor
Representative” means Johannes Huth or a successor designated in a written
notice to Philips, Newco, NXP and the Management Trust signed by Investor.

 

“IPO” means
the Public Offering, if any, pursuant to which the IPO Entity first becomes a
Public Company.

 

“IPO Entity”
means Newco or any other Person that the Parties mutually agree to be the IPO
Entity, provided that such other Person agrees to be bound by the provisions of
Article VII hereof. At any time that the IPO Entity is a Person other than
Newco, Newco shall not be bound by the provisions of Article VII hereof.

 

“IRC” means
the U.S. Internal Revenue Code of 1986, as amended from time to time, or any
similar federal statute then in effect, and a reference to a particular section
thereof shall be deemed to include a reference to the comparable section, if
any, of any such similar federal statute.

 

“Issuer Free
Writing Prospectus” means an issuer free writing prospectus within the
meaning of Rule 433(h) under the Securities Act prepared by or on behalf of the
IPO Entity or used or referred to by the IPO Entity.

 

5

 

“Law” means
any law, statute, ordinance, rule, regulation, code, order, judgment,
injunction or decree enacted, issued, promulgated, enforced or entered by a
Governmental Authority or Self-Regulatory Organization.

 

“Losses”
has the meaning set forth in Section 7.5(a).

 

“Management
Trust” has the meaning set forth in the Preamble.

 

“Management
Trust Drag-Along Sale” has the meaning set forth in Section 3.3(e).

 

“Management
Trust Tag-Along Notice” has the meaning set forth in Section 3.4(g).

 

“Management
Trust Tag-Along Offer” has the meaning set forth in Section 3.4(g).

 

“Management
Trust Tag-Along Sale” has the meaning set forth in Section 3.4(a).

 

“Management
Trust Tag-Along Shares” has the meaning set forth in Section 3.4(g).

 

“Maximum Number”
has the meaning set forth in Section 7. l(e)(iv).

 

“Moody’s”
means Moody’s Investor Service, Inc.

 

“NASD”
means National Association of Securities Dealers, Inc.

 

“Net Debt”
means, as of any date (and without duplication), (a) the sum of the following
items, calculated on a consolidated basis (whether or not then due and
payable): (i) all outstanding indebtedness (A) for borrowed money, (B)
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or, without duplication, reimbursement agreements in respect thereof)
or (C) representing the deferred and unpaid balance of the purchase price of
any property (including capitalized leased obligations), except any such
balance that constitutes a trade payable or similar obligation to a trade
creditor, in each case accrued in the ordinary course of business, and (ii)
accrued interest payable with respect to indebtedness referred to in clause (i)
minus (b) cash and cash equivalents (net of all overdrafts), calculated on a
consolidated basis.

 

“Net Debt
Leverage Ratio” means, as of any date, the ratio of (a) Net Debt as of such
date divided by (b) EBITDA for the four consecutive fiscal quarters immediately
preceding such date.

 

“Newco” has
the meaning set forth in the Preamble.

 

“Newco Auditor”
has the meaning set forth in Section 5.2(a).

 

6

 

“Newco Group”
means Newco and its Subsidiaries, taken as a whole.

 

“Nomination
Notice” has the meaning set forth in Section 2.3.

 

“NXP” has
the meaning set forth in the Preamble.

 

“Offer” has
the meaning set forth in Section 3.2.

 

“Offer Document”
shall mean an EU Prospectus and/or a Registration Statement, as the context may
require.

 

“Organizational
Documents” means with respect to any corporation, its articles or
certificate of incorporation and by-laws, and with respect to any other type of
entity, its organizational documents.

 

“Override
Notice” has the meaning set forth in Section 7.2(a).

 

“Parties”
means each of NXP, Newco, the IPO Entity, the Shareholders and any other
parties to this Agreement from time to time.

 

“Participation
Request” has the meaning set forth in Section 7.1(b).

 

“Person”
means an individual, a corporation, a partnership, an association, a limited
liability company, a Governmental Authority, a trust or any other entity or
organization.

 

“Philips”
has the meaning set forth in the Preamble.

 

“Philips
Auditor” has the meaning set forth in Section 5.2(b).

 

“Philips
Director” has the meaning set forth in Section 2.3(d).

 

“Philips
Drag-Along Notice” has the meaning set forth in Section 3.3(b).

 

“Philips
Drag-Along Sale” has the meaning set forth in Section 3.3(a).

 

“Philips Group”
means Philips and its Subsidiaries, taken as a whole.

 

“Philips
Minimum Percentage” means 10%.

 

“Philips
Nominee” has the meaning set forth in Section 2.3.

 

“Philips
Tag-Alone Notice” has the meaning set forth in Section 3.4(a).

 

“Philips
Tag-Along Offer” has the meaning set forth in Section 3.4(a).

 

“Philips
Tag-Along Sale” has the meaning set forth in Section 3.4(a).

 

“Philips
Tag-Along Shares” has the meaning set forth in Section 3.4(a).

 

7

 

“Philips
Transferee Minimum Percentage” means 15%.

 

“Priority
Period” has the meaning set forth in Section 7.2(c).

 

“Proceeds”
has the meaning set forth in Section 2.4(d).

 

“Prospectus
Directive” means Directive 2003/71/EC of the European Parliament and of the
Council of November 4, 2003 on the prospectus to be published when securities
are offered to the public or admitted to trading and amending Directive
2001/34/EC, or any EU directive, regulation or other legislation then in effect
which has replaced such statute, and a reference to a particular section
thereof shall be deemed to include a reference to the comparable section, if any,
of any such replacement directive, regulation or other legislation.

 

“Public Company”
means a Person if, as of any date of determination, ten percent (10%) of its
then outstanding Equity Securities have been sold in one or more Public
Offerings.

 

“Public
Offering” means a public offering of Subject Securities.

 

“Qualification”
means (a) in the case of an EU Prospectus required to be approved by the
competent authority of the Home Member State, the approval of such EU
Prospectus by such competent authority and publication thereof under the terms
of the Prospectus Directive, (b) in the case of any other EU Prospectus, the
publication thereof in accordance with applicable Law and regulation and (c) in
the case of a Registration Statement, the declaration of effectiveness thereof
by the SEC.

 

“Qualified
Public Offering” means a Public Offering of an amount of Subject Securities
which, immediately following the closing of such Public Offering, equals or
exceeds 10% of the IPO Entity’s then issued and outstanding Equity Securities,
provided that (a) immediately after the closing of such Public Offering, the
IPO Entity’s Equity Securities are traded on a national securities exchange or
through the Nasdaq National Market, the London Stock Exchange, or are otherwise
actively traded over-the-counter and (b) the aggregate gross proceeds of such
Public Offering (net of underwriting discounts and commissions) equal or exceed
€1,000,000,000 (or the equivalent in other currencies).

 

“Records”
has the meaning set forth in Section 7.3(a)(vi).

 

“Registration
Statement” means any registration statement under the Securities Act that
covers Subject Securities, including the prospectus, amendments and supplements
to such registration statement, including post-effective amendments, all
exhibits, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.

 

“Regulator”
means, in the case of a Public Offering made in the European Union, the AFM or
any other applicable securities regulator, or, in the case a Public Offering
made in the United States, the SEC.

 

8

 

“Reporting
Period” means any financial reporting period for which Philips accounts or
reasonably expects to account for its interest in the Newco Group in its
consolidated financial statements.

 

“Respondent”
has the meaning set forth in Section 8.7.

 

“S&P”
means Standard & Poor’s, a division of The McGraw Hill Companies, Inc.

 

“Sale”
means any sale, assignment, transfer, pledge, creation of a usufruct,
distribution or other disposition of a security or of a participation or other
rights therein, whether voluntarily or by operation of law. The terms “Sell”
and “Sold” have corresponding meanings.

 

“SEC” means
the U.S. Securities and Exchange Commission.

 

“SEC Required
Period” shall mean with respect to a “shelf registration” requested
pursuant to Section 7.1 two years following the first day of effectiveness of
such Registration Statement, and with respect to any other Registration
Statement, 90 days following the first day of effectiveness of such
Registration Statement.

 

“Securities Act”
means the U.S. Securities Act of 1933, as amended, and the SEC’s rules and
regulations thereunder.

 

“Self-Regulatory
Organization” means the National Association of Securities Dealers, Inc.,
the American Stock Exchange, the National Futures Association, the Chicago
Board of Trade, the New York Stock Exchange, any national securities exchange
(as defined in the Exchange Act), any other securities exchange, futures
exchange, contract market, any other exchange or corporation or similar self-regulatory
body or organization.

 

“Selling
Shareholder” has the meaning set forth in Section 7.3(a)(i).

 

“Shareholders”
means Investor, Philips, the Management Trust and any other Persons that may
from time to time own Shares and become Parties to this Agreement.

 

“Shares”
means the issued and outstanding Equity Securities of Newco from time to time.

 

“Stichting
Management” has the meaning set forth in the Preamble.

 

“Stock Purchase
Agreement” has the meaning set forth in the Preamble.

 

“Subject
Securities” means Equity Securities of the IPO Entity.

 

“Subscription
Agreement” has the meaning set forth in the Preamble.

 

9

 

“Subsidiary”
means with respect to any Person (other than a natural person) any other Person
of which (i) the first mentioned Person or any Subsidiary thereof is a general
partner, (ii) voting power to elect a majority of the Board or others
performing similar functions with respect to such other Person is held by the
first mentioned Person and/or by any one or more of its Subsidiaries, or (iii)
at least 50% of the equity interests of such other Person is, directly or
indirectly, owned or controlled by such first mentioned Person and/or by any
one or more of its Subsidiaries.

 

“Third Party”
means, with respect to any Shareholder, any Person other than an Affiliate of
such Shareholder.

 

“Underwriters”
has the meaning set forth in Section 7.3(a)(i).

 

“U.S. GAAP”
means generally accepted accounting principles in the United States.

 

“U.S.
Prospectus” means a prospectus with respect to the Public Offering within
the European Union included in any Registration Statement (including a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective Registration Statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Subject Securities covered by such Registration Statement, and by all
other amendments and supplements to the U.S. Prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such U.S. Prospectus.

 

Section 1.2. Other
Terms. Other terms may be defined elsewhere in the text of this Agreement
and, unless otherwise indicated, shall have such meaning throughout this
Agreement.

 

Section 1.3. Other
Definitional Provisions. Unless the express context otherwise requires:

 

(a) Unless
otherwise specifically indicate, the word “day” means “calendar day”;

 

(b) the words “hereof,
“herein”, “hereunder” and “hereby” and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole and not to any
particular provision of this Agreement;

 

(c) the terms
defined in the singular have a comparable meaning when used in the plural, and
vice versa;

 

(d) the terms “Dollars”
and “$” mean U.S. Dollars;

 

(e) the terms “euros”
and “€” mean Euros;

 

10

 

(f) references in
this Agreement to a specific Section, Subsection or Schedule shall  refer, respectively, to  Sections, Subsections or Schedules of this
Agreement;

 

(g) wherever the
word “include,” “includes,” or “including” is used in this Agreement, it shall
be deemed to be followed by the words “without limitation”; and

 

(h) references in
this Agreement to any gender include each other gender.

 

ARTICLE
II 

CORPORATE GOVERNANCE

 

Section 2.1. Corporate
Governance Principles. The Parties agree that (a) the Organizational
Documents of Newco shall at all times provide that Newco shall have (i) a
supervisory board comprised of at least three and no more than ten directors
and (ii) a management board comprised of at least three and no more than seven
directors, (b) the Organizational Documents of NXP shall at all times provide
that NXP shall have (i) a supervisory board comprised of at least three and no
more than ten directors and (ii) a management board comprised of at least three
and no more than seven directors, (c) the chairman of the supervisory board of
NXP (the “Chairman”) shall at all times be a director mutually
acceptable to Investor and Philips and not affiliated with any of the
Shareholders, it being understood that the Chairman shall not have any special
rights or authority, other than as specified in Section 2.4(b), (d) the
composition of the supervisory board of Newco shall at all times be identical
to that of the supervisory board of NXP, except that the Chairman shall not be
a member of the supervisory board of Newco, (e) Investor shall have the right
to appoint a majority of the members of the management board of Newco, a
majority of the members of the supervisory board of Newco and a majority of the
members of the supervisory board of NXP, (f) all of the rights provided for in
this Article II shall exist for only so long as Philips holds a percentage of
the outstanding Shares that equals or exceeds the Philips Minimum Percentage
and (g) no Shareholder shall take any action that is inconsistent with these
principles.

 

Section 2.2. Initial
Composition of Newco and NXP Boards: Board Committees. The supervisory
board of NXP shall initially be comprised of eight directors, six of whom shall
be designated by Investor and one of whom shall be designated by Philips, plus
an additional director not affiliated with any of the Shareholders and having
the necessary qualifications that would be appropriate for an independent,
unaffiliated director serving on an audit committee of a public company
comparable in size to NXP, who shall be designated jointly by Investor and
Philips based on the selection by Philips from a list of at least five
potential candidates meeting such qualifications submitted to Philips in good
faith by the Investor, and who shall serve as the chairman of the management
board of Newco and the supervisory board of NXP. The initial designees of
Investor shall be Johannes Huth, Adam Clammer, Michel Plantevin, Ian Loring,
Egon Durban and Christian Reitberger and the initial designee of Philips shall
be Eric Coutinho (collectively, the “Initial Members”), and the initial
chairman shall be

 

11

 

Sir Peter Bonfield (the “Initial
Chairman” and, together with the Initial Members, the “Initial Directors”).
The management board of NXP shall initially be comprised of the following four
directors: Frans van Houten (CEO), Peter van Bommel (CFO), Theo Claasen and
Hein van der Zeeuw (the “Initial Managers”). Each Shareholder agrees to
vote its Shares in favor of the election of each of the Initial Members as a
member of the supervisory board of Newco. In addition, each of Newco and each
Shareholder agrees to use its best efforts to cause each of the Initial
Directors to be elected as a member of the supervisory board of NXP, the Initial
Chairman appointed as chairman of the supervisory board of NXP and each of the
Initial Managers to be elected as a member of the management board of NXP. The
management board and supervisory board of Newco and the supervisory board of
NXP shall have such committees as shall from time to time be determined by such
boards. The Philips Director shall not be a member of any such committees but
shall have full observation and information rights with respect to any
committee meetings with full power of substitution in the event the Philips
Director is unable to participate in any such committee meeting.

 

Section 2.3. Philips
Ongoing Rights with Respect to Newco and NXP Boards. (a) For so long as
Philips holds a percentage of the outstanding Shares that equals or exceeds the
Philips Minimum Percentage, (i) Philips shall have the right at any time and
from time to time to cause each of Newco and NXP to convene a shareholders
meeting for the purpose of electing directors to the supervisory board of Newco
or the supervisory board of NXP, as the case may be and (ii) in connection with
each shareholders meeting of Newco or NXP at which directors are to be
considered for election to the supervisory board of Newco or the supervisory
board of NXP, respectively, Philips shall have the right to nominate for
election from among its current and former employees one director (the “Philips
Nominee”) by giving written notice (the “Nomination Notice”) of the
Philips Nominee to the other Shareholders at least fifteen (15) days in advance
of the relevant shareholders meeting (or within five (5) days of the date that
notice is given of any such meeting if scheduled less than fifteen (15) days
following the date of such notice).

 

(b) For so long as
Philips has the right to nominate a Philips Nominee pursuant to Section 2.3,
each Shareholder agrees (i) to vote its Shares at each regular or special
shareholders meeting of Newco called for the purpose of filling positions on
the supervisory board of Newco and use its best efforts to cause the directors
of Newco to vote the Equity Securities of NXP held by Newco at each regular or
special shareholders meeting of NXP called for the purpose of filling positions
on the supervisory board of NXP, and (ii) if action is to be taken with respect
to Newco, to vote its Shares in favor of the election as a member of the
supervisory board of Newco of the Philips Nominee, and in each case to take all
other necessary and appropriate actions in its capacity as a Shareholder to
cause the aforesaid results to occur and not to take any action that is
inconsistent with these results. In addition, for so long as Philips has the
right to nominate a Philips Nominee pursuant to Section 2.3, each of Newco and
each Shareholder agrees, if action is to be taken with respect to NXP, to use
its best efforts to cause the directors of Newco to cause the Philips Nominee
to be elected as a member of the supervisory board of NXP and an individual
agreed to by Investor and Philips to be

 

12

 

the Chairman in
accordance with the provisions of Section 2.2 to be elected as a member of the
supervisory board of NXP and appointed as Chairman.

 

(c)
Notwithstanding anything to the contrary in this Section 2.3, each Shareholder
shall have the right to call for the removal of any member of the supervisory
board or management board of Newco or the supervisory board or management board
of NXP for Cause. “Cause” means (i) any act of fraud, misappropriation
or willful misconduct by a director, (ii) a director’s conviction for, or the
entering of a guilty plea or plea of nolo contendere with respect to, a felony,
the equivalent thereof, any other crime with respect to which imprisonment is a
possible punishment or which is expected to result in significant economic or
reputational injury to Newco or NXP or (iii) the disclosure by a director of
confidential information of Newco, NXP or any Shareholder to the detriment of
Newco, NXP or any such Shareholder (except pursuant to customary
confidentiality arrangements in a form approved by the board of which the
relevant individual is a director).

 

(d) For so long as
Philips has the right to nominate a Philips Nominee pursuant to Section 2.3,
Philips may at any time request that a director nominated by it (a “Philips
Director”) be removed from the supervisory board of Newco or the
supervisory board of NXP. Each Shareholder agrees to vote its Shares in favor
of the removal from the supervisory board of Newco of any Philips Director whom
Philips requests be removed pursuant to the preceding sentence, and take all
other necessary and appropriate actions in its capacity as a Shareholder to
cause the aforesaid results to occur and not to take any action that is
inconsistent with these results. In addition, each of Newco and each
Shareholder agrees to use its best efforts to cause the removal from the
supervisory board of NXP of any Philips Director whom Philips requests be
removed pursuant to the preceding sentence. For so long as Philips has the
right to nominate a Philips Director pursuant to Section 2.3, Philips shall
have the right to nominate a replacement director in accordance with this
Section 2.3.

 

(e) Philips
agrees, at any time Philips holds a percentage of the outstanding Shares that
is less than the Philips Minimum Percentage, upon the request of Investor, to
use its best efforts cause the Philips Director to resign from the board of
Newco and the supervisory board of NXP.

 

Section 2.4. Governance
Rights. (a) Philips Approval Rights. For so long as Philips has the
right to nominate a Philips Nominee pursuant to Section 2.3, neither Newco nor
NXP, nor any of their respective Subsidiaries, shall take any of the following
actions without the approval of both the majority of the management board of
Newco and, if applicable, the supervisory board of NXP, and the approval of the
Philips Director:

 

(i)
amend its Organizational Documents with respect to any matter, if such
amendment would adversely affect or interfere with Philips’s rights as a
Shareholder or its rights under this Agreement;

 

13

 

(ii)
engage in, or permit any of its Subsidiaries to engage in, an Affiliate
Transaction;

 

(iii)
in the case of Newco, modify or waive the preemptive rights attaching to the
Shares, engage in a legal merger, demerger or liquidation of Newco, redeem or
repurchase any Shares other than on a pro rata basis, redeems or repurchases
other Equity Securities, preferred securities and shareholder loans other than
on a basis that treats Philips and Investor equally on a pro rata basis, or
issue to any Third Party any debt or preferred securities other than customary
indebtedness for the purpose of funding the normal operations of Newco. For the
avoidance of doubt Philips and the Investor hereby waive and agree to waive
their pre-emption rights in relation to any issuance by Newco of Equity
Securities in connection with an IPO or to one or more appropriate vehicles
designated by Investor and managed by one or more representatives of Investor
or certain directors or employees of NXP or its Subsidiaries for the benefit of
certain of the directors, officers and employees of NXP and its Subsidiaries,
provided that, as a precondition to such issuance, such vehicles shall agree to
become Parties to this Agreement and Philips shall receive a copy of Schedule 1
executed by such vehicle and acknowledged and agreed to by each other
Shareholder and upon such receipt, the vehicles shall become part of the
Management Trust for purposes of this Agreement;

 

(iv)
in the case of Newco, acquire or make an investment in any entity other than
NXP; and

 

(v)
sell Equity Securities and/or assets representing all or substantially all of
NXP’s assets in exchange for Equity Securities of a Person that is not active
in the semiconductor industry.

 

(b) NXP
Chairman Rights. NXP shall not take any of the following actions without,
in addition to approval by the supervisory board of NXP, the written approval
of the Chairman:

 

(i)
except if and to the extent permitted under the terms of the Facilities, incur
or permit any of its Subsidiaries to incur, any indebtedness, or issue any debt
securities or assume, guarantee or endorse any material obligations of any
other Person, if following such incurrence, issuance, assumption, guarantee or
endorsement (i) NXP’s Fixed Charge Coverage Ratio would be less than 2.5:1.00
or (ii) NXP’s Net Debt Leverage Ratio would exceed 3.91:1.00;(1) or

 

(1)           The Parties agree that the
ratio 3.9:1 is an estimate. The final ratio will be set equal to the Company’s
and Company’s Subsidiaries actual consolidated Net Debt Leverage Ratio as of
the Closing Date (as defined in the Stock Purchase Agreement). Following the
preparation of the Closing Date Financial Statements (as defined in the Stock
Purchase Agreement), the Parties shall in good faith determine that ratio and
amend this Shareholders’ Agreement to reflect that final ratio.

 

14

 

(ii)
except to the extent required to enable Newco to pay to Philips any Adjustment
Amount (as defined in the Stock Purchase Agreement) and then only in an amount
equal to the lesser of (A) the Adjustment Amount (as defined in the Stock
Purchase Agreement) and (B) the difference between the Closing Date Net Cash
Position (as defined in the Stock Purchase Agreement) and the Reference Net
Cash Position (as defined in the Stock Purchase Agreement) (in which case Newco
hereby agrees to use such funds to make the required payment to Philips
pursuant to Section 2.7 of the Stock Purchase Agreement), pay dividends or make
other distributions with respect to its Equity Securities, redeem or repurchase
any Equity Securities or make any loans to Newco, other than loans for the
purpose of funding the normal operations of Newco if, after taking into account
NXP’s free cash flow, its liquidity situation generally and its short- and
medium-term prospects, in each case at the time of the proposed dividend or
distribution, NXP would not have, in the reasonable judgment of the Chairman,
sufficient and available liquidity for its foreseeable needs.

 

(c) Other
Rights. For so long as Philips holds a percentage of the outstanding Shares
that equals or exceeds 5% but does not equal or exceed the Philips Minimum
Percentage or the Management Trust holds a percentage of the outstanding
ordinary Shares that equals or exceeds 5%, the Shareholders shall not take any
of the following actions without the approval of Philips or the Management
Trust, as the case may be:

 

(i)
amend the Articles of Association of Newco with respect to any matter, if such
amendment would disproportionately and adversely affect or interfere with the
rights of Philips or the Management Trust, as the case may be, as a Shareholder
or its rights under this Agreement;

 

(ii)
in the case of Newco, modify or waive the preemptive rights attaching to the
Shares held by Philips or the Management Trust, as the case may be, unless doing
so would affect all Shareholders of that class on a pro rata basis, it being
understood that Philips and the Management Trust hereby waive and agree to
waive their respective pre-emption rights in relation to any issuance by Newco
of Equity Securities pursuant to this Section 2.4(c)(ii): (i) in connection
with an IPO or other Public Offering; (ii) to any Person in connection with and
as consideration or to raise the requisite consideration for Newco’s direct or
indirect acquisition by merger, other business combination or otherwise of any
Person, business or assets; or (iii) to one or more appropriate vehicles
designated by Investor and managed by one or more representatives of Investor
or certain directors or employees of NXP or its Subsidiaries for the benefit of
certain of the directors, officers and employees of NXP and its Subsidiaries,
provided that, as a precondition to such issuance, such vehicles shall agree to
become Parties to this Agreement and Philips shall receive a copy of Schedule 1
executed by such vehicle and acknowledged and agreed to by each other
Shareholder and upon such receipt, the vehicles shall become part of the
Management Trust for purposes of this Agreement; and

 

15

 

(iii)
engage in a legal merger, demerger or liquidation of Newco, unless the proposed
transaction would have substantially the same effect on all holders of Shares
of the class held by Philips or the Management Trust, as the case may be.

 

(d) Sale of NXP
for Cash. In the event that Newco (i) Sells Equity Securities of NXP or
(ii) causes NXP or any of its Subsidiaries, in one or a series of transactions
to dispose of stock and/or assets representing substantially all of the
business of NXP and its Subsidiaries, in each case for cash and/or Cash
Equivalents net of related expenses including taxes (the “Proceeds”),
Newco shall, immediately following completion of such Sale (y) if Newco was not
the recipient of the Proceeds, cause the Proceeds to be distributed to Newco
and (z) distribute an amount of cash equal to the Proceeds to the Shareholders
on a pro rata basis in a manner that is reasonably intended to be the most tax
efficient to the Shareholders.

 

Section 2.5. Organizational
Documents. The Parties agree, and shall use their best efforts to procure,
that (a) as of the Closing the Articles of Association of Newco and NXP will be
in the form set forth in Schedule 2 and (b) for the duration of this Agreement,
notwithstanding anything to the contrary in this Article 11, the Organizational
Documents of Newco shall not be amended with respect to any matter in any way
which based on the number of Shares held by each Shareholder would have a
disproportionate effect on Philips’s position as a Shareholder. The Parties
agree that, whenever there is a conflict between any provision of this
Agreement and any provision of the Organizational Documents of Newco, NXP or
any of their respective Subsidiaries, the provisions of this Agreement shall
prevail. Further, each Party undertakes to vote its Shares at each regular or
special shareholders meeting of Newco in a way that it is not inconsistent with
this Agreement.

 

ARTICLE
III 

TRANSFER OF SHARES

 

Section3.1. Transfer
Restrictions. Except as otherwise provided herein, no Shareholder shall
Sell directly or indirectly any Shares or any interest therein. The Shares are
to be treated as a stapled strip and, accordingly, no Shareholder shall
transfer any class of Share without at the same time transferring a pro rata
portion of every other class of Share held by that Shareholder immediately
prior to such transfer.

 

Section 3.2. Permitted
Transfers. Notwithstanding Section 3.1,

 

(a) Investor may
Sell directly or indirectly Shares in accordance with Section 3.3 and Section
3.4, provided that, as a precondition to such Sale, the Person to whom such
Sale is made shall agree to become a Party to this Agreement on terms
reasonably satisfactory to Philips, unless in connection with such Sale Philips
ceases to hold a percentage of the outstanding Shares that equals or exceeds
the Philips Minimum Percentage,

 

16

 

(b)
notwithstanding sub-section (a), Section 3.3 and Section 3.4, Investor may in
one or more transactions in the period up to the date that falls three (3)
months after the Closing Sell Shares together with proportionally related
capital contributions to Newco, provided that (i) following such Sale,
Investor, together with one or more Investor Affiliates, shall continue to own
or control (as such term is used in the definition of Affiliate) a number of
Shares equal to at least 50% of the Shares held by Investor as of the Closing,
(ii)any such Sale or any agreement to Sell such Shares at or before the Closing
shall be disregarded in determining the extent of Investor’s liability for
obligations under or breaches of this Agreement or the Investor Equity
Commitment Letters prior to the Closing, (iii) as a precondition to such Sale,
the Person to whom such Sale is made shall agree to become a Party to this
Agreement on the same terms as Investor and (iv) to the extent that, prior to
any such Sales, Investor provides to Philips written notice of the identities
of the proposed purchasers and the number of Shares to be purchased,

 

(c) Philips may
Sell Shares to any Person other than to a direct competitor of NXP provided
that (i) Philips shall (A) first give written notice to Investor of its
intention to Sell such Shares, (B) Investor shall have the right, by written
notice to Philips within fifteen (15) days after receipt of such notice, to
offer to purchase all, but not a portion of, such Shares (the “Offer”)
and (C) in the event that Philips accepts the terms and conditions stipulated
in the Offer, it shall Sell such Shares to Investor within fifteen (15) days of
Philips’s receipt of the notice given pursuant to (B) and (ii) in the event
that Philips does not accept the terms and conditions stipulated in the Offer,
it may within ninety (90) days following the expiration of the period set forth
under (i)(B) proceed with such Sale to such Person, provided that (A) the price
per Share shall be no less than that stipulated in the Offer and the other
terms and conditions of such Sale shall be no less favorable to Philips than
those stipulated in the Offer and (B) as a precondition to such Sale, such
Person shall agree to become, and NXP, Newco, Investor and the Management Trust
hereby agree to such Person becoming, a Party to this Agreement on the same
terms as Philips, except that, in lieu of the rights provided by Article II,
for so long as such Person holds a percentage of the outstanding Shares that equals
or exceeds the Philips Transferee Minimum Percentage (l) such Person shall have
the right at any shareholders meeting of Newco or NXP convened for the purpose
of electing directors to the management board of Newco or the supervisory board
of NXP, respectively, to nominate for election from among its current and
former employees one director, (2) if necessary, the size of the management
board of Newco and of the supervisory board of NXP shall be increased to
accommodate such director and (3) each Shareholder hereby agrees to vote its
Shares and to take all other necessary and appropriate actions in its capacity
as a Shareholder to cause the results described under (1) and (2) to occur and
not to take any action that is inconsistent with these results;

 

(d) In addition,
any Shareholder that is not a natural Person may transfer Shares to a
wholly-owned Subsidiary and Investor may transfer Shares to an Investor
Affiliate, provided that such wholly-owned Subsidiary or Investor Affiliate, as
the case may be, agrees in writing to be bound by this Agreement; and

 

17

 

(e)
notwithstanding anything to the contrary in this Section 3.2, Section 3.3 and
Section 3.4, (i) Investor may Sell depositary receipts (or similar equity
instruments) for Shares issued or sold to the Management Trust to the
directors, officers and employees of NXP and its Subsidiaries, and (ii) if
Investor approves, the Management Trust may directly or indirectly Sell Shares
to any other vehicle Management Trust, provided that, as a precondition to such
Sale, such vehicle shall agree to become a Party to this Agreement and Philips
shall receive a copy of Schedule I executed by such vehicle and acknowledged
and agreed to by each other Shareholder and upon such receipt, the vehicle
shall become part of the Management Trust for purposes of this Agreement,

 

Section 3.3. “Drag-Along”
Rights. (a) If Investor, prior to a Qualified Public Offering, proposes in
a transaction or series of related transactions, directly or indirectly, to
Sell to a Third Party a number of Shares that equals or exceeds 90% of the
Shares then held by Investor (a “Philips Drag-Along Sale”), Investor
shall have the right to require Philips also to Sell all (but not less than
all) of its Shares to such Third Party, and such Sale by Philips shall be made
at the same price per Share and, subject to Section 3.3(c), on the same terms
and conditions as the Sale made by Investor. Notwithstanding the foregoing,
under no circumstances shall Philips be required to agree to accept any consideration
not wholly consisting of a combination of cash, Cash Equivalents and/or Equity
Securities listed or qualified for trading on a generally recognized and
generally accepted stock exchange or quotation service in the United States or
Europe.

 

(b) Investor
shall, within ten (10) days after the later of agreeing definitive
documentation with respect to, or consummating, a Philips Drag-Along Sale with
respect to which Investor wishes to exercise its rights under this Section 3.3
provide to Philips written notice (the “Philips Drag-Along Notice”)
specifying the material terms and conditions of the Philips Drag-Along Sale,
including the identity of the buyer to which the Philips Drag-Along Sale is
proposed to be made and the price per Share to be paid. If the Philips
Drag-Along Sale is not consummated within ninety (90) days from the date of the
Philips Drag-Along Notice, Investor shall deliver another Philips Drag-Along
Notice in order to be entitled to exercise their rights under this Section 3.3.

 

(c) Philips shall
(i) make or agree to the same representations, covenants, indemnities (with
respect to all matters other than Investor’s ownership of Shares) and other
agreements as Investor on a pro rata basis reflecting the number of Shares Sold
by Philips, provided that (a) any such representations, covenants and other
agreements shall be made or agreed severally and not jointly, and (b) Philips’s
representations, covenants and other agreements shall only survive the closing
of the Sale if (x) Philips consents, which consent shall not be unreasonably
withheld, and (y) if and to the extent that the Investor’s representations,
covenants and other agreements shall survive the closing of the Sale and (ii)
take all such actions and exercise its voting rights with respect to its Shares
or its right to act by written consent, as applicable, in such manner as may be
necessary and appropriate to ensure that the Philips Drag-Along Sale or
Management Trust Drag-Along Sale is consummated. No action by Newco shall be
required in connection with a Philips Drag-Along Sale or Management Trust
Drag-Along

 

18

 

Sale, as the case may be,
except for ministerial actions not requiring action on the part of the
management board of Newco.

 

(d) At the closing
of a Philips Drag-Along Sale, Investor shall remit to Philips, or procure the
remittance to Philips of, Philips’s share of the consideration for the Shares
sold by Philips in the Philips Drag-Along Sale, it being understood that
Philips shall bear its proportionate share of all third party transaction fees
and expenses (and specifically excluding any transaction fees paid to any
Investor Affiliate) in connection with the Philips Drag-Along Sale.

 

(e) If Investor,
prior to a Qualified Public Offering, proposes, directly or indirectly, to Sell
to a Third Party any Shares then held by Investor and which are of the same
class as the Shares held by the Management Trust (a “Management Trust
Drag-Along Sale”). Investor shall have the right to require the Management
Trust also to Sell a pro rata portion if its Shares of the relevant class to
such Third Party, and such Sale by the Management Trust shall be made at the
same price per Share as the Sale made by Investor and otherwise on customary
terms and conditions, which will include procuring that, to the extent
reasonably requested by the Investor, the relevant directors, officers and
employees of NXP and its Subsidiaries that are beneficiaries of the Management
Trust make representations and warranties concerning the relevant underlying
business, it being understood that the CEO of NXP shall be entitled to
negotiate such representations and warranties on behalf of the relevant
individuals, such individuals shall be entitled to make fair disclosure against
such representations and warranties and, if and to the extent Investor, acting
in its sole and unfettered discretion, decides to give similar representations
and warranties, any indemnification or other liability thereunder shall be
shared by the Investor and the relevant directors, officers and employees
giving such representations and warranties pro rata according to the number of
Shares held by them or for their benefit. The Management Trust shall take all
such actions and exercise their respective voting rights with respect to their
respective Shares or their respective rights to act by written consent, as
applicable, in such manner as may be necessary and appropriate to ensure that
the Philips Drag-Along Sale or Management Trust Drag-Along Sale (as the case
may be) is consummated.

 

(f) At the closing
of a Management Trust Drag-Along Sale, investor shall remit to the relevant
Management Trust, or procure the remittance to the relevant Management Trust
of, that Management Trust’s share of the consideration for the Shares sold by
that Management Trust in the Management Trust Drag-Along Sale, it being
understood the Management Trust shall bear its proportionate share of all third
parry transaction fees and expenses in connection with the Management Trust
Drag-Along Sale, such proportionate share being determined according to the
gross proceeds to be received by each seller in the relevant sale.

 

(g) If the
transaction giving rise to a Philips Drag-Along Sale or a Management Trust
Drag-Along Sale is triggered by a proposed transaction to Sell Equity Securities
of an entity that directly or indirectly owns 100% of the Equity Securities of
Investor (each such entity, a “Holdco”), Investor shall have the right,
instead of requiring Philips or the Management Trust, as the case may be, to
Sell the Philips Drag-Along

 

19

 

Shares or the Management
Trust Drag-A long Shares, as the case may be, to the relevant Third Party, to
require Philips or the Management Trust, as the case may be, to either, at
Investor’s discretion, (i) contribute such Shares to Holdco (it being
understood that such contribution may occur in several steps via contributions
to Investor and any other wholly-owned intermediate entities) in exchange for
Equity Securities issued by Holdco that are equivalent in terms of economics to
such contributed Shares (taking into account the provisions of this Agreement)
and then to effect a Sale of such Equity Securities to such Third Party as
though such Sale were a Philips Drag-Along Sale or a Management Trust
Drag-Along Sale, as the case may be or (ii) immediately prior to the time
scheduled for the closing of such Sale, to transfer such Shares to Investor by
way of a repurchase and cancellation, subject, in each case, to the conditions
that (i) the Sale of such Equity Securities to such Third Party or such
repurchase and cancellation actually occurs and (ii) as a result of such Sale
or repurchase and cancellation, the net proceeds payable to Philips or the
Management Trust, as the case may be, in respect of the Shares so contributed
or repurchased and cancelled is not less than the net proceeds that would have
been payable to Philips or the Management Trust, as the case may be, if such
Shares had been Sold to such Third Party in a Philips Drag-Along Sale or
Management Trust Drag-Along Sale, as the case may be.

 

Section 3.4. “Philips
Tag-Along” Rights. (a) (i) If Investor, prior to a Qualified Public
Offering, proposes to Sell (a “Philips Tag-Along Sale”) Shares (the
Shares proposed to be Sold in the Philips Tag-Along Sale being referred to as
the “Philips Tag-Along Shares”) to a Third Party, Investor shall (i)
procure that the buyer to which the Philips Tag-Along Sale is proposed to be
made makes a written offer to Philips to purchase from Philips up to a number
of Shares equal to the portion of Philips’s Shares representing the same
percentage of the total number of Shares held by Philips as the portion of the
Shares being Sold by Investor represents of the total number of Shares held by
Investor immediately prior to the Philips Tag-Along Sale at the same price per
Share and on the same terms and conditions as offered to Investor (the “Philips
Tag-Along Offer”), (ii) within ten (10) days of agreeing definitive
documentation with respect to the Philips Tag-Along Sale provide to Philips
written notice (the “Philips Tag-Along Notice”) specifying the material
terms and conditions of the Philips Tag-Along Sale, including the identity of
the buyer to which the Philips Tag-Along Sale is proposed to be made, the price
per Share to be paid and the maximum number of Shares that Philips may sell
pursuant to the Philips Tag-Along Offer and (iii) in the event that Philips
accepts the Philips Tag-Along Offer, condition the closing of the Philips
Tag-Along Sale on the closing of Philips’s Sale of Shares pursuant to the Philips
Tag-Along Offer.

 

(b) Philips may
accept a Philips Tag-Along Offer within thirty (30) days of receiving a Philips
Tag-Along Notice by providing to Investor on the one hand and the proposed
buyer on the other hand a written notice of acceptance, specifying the number
of Shares that it wishes to Sell to the buyer pursuant to the Philips Tag-Along
Offer.

 

(c) Upon
acceptance by Philips of a Philips Tag-Along Offer, Philips shall be deemed to
have agreed to Sell the number of Shares specified in the Philips Tag-Along
Notice and shall (i) make or agree to the same representations, covenants,

 

20

 

indemnities (with respect
to all matters other than Investor’s ownership of Shares) and other agreements
as Investor on a pro rata basis reflecting the number of Shares Sold by
Philips, provided that any such representations, covenants, indemnities and
other agreements shall be made or agreed severally and not jointly and (ii)
take all such actions and exercise its voting rights with respect to its Shares
or its right to act by written consent, as applicable, in such manner as may be
necessary and appropriate to ensure that the Philips Tag-Along Sale is
consummated.

 

(d) Investor shall
be under no obligation to Philips pursuant to this Section 3.4 as a result of
any decision by Investor not to consummate a Philips Tag-Along Sale (it being
understood that such decision shall be made by Investor in its sole
discretion).

 

(e) Philips shall
bear its proportionate share of all third party transaction fees and expenses
(and specifically excluding any transaction fees paid to any Investor
Affiliate) in connection with a Philips Tag-Along Sale.

 

(f) Philips shall
take all such actions and exercise its voting rights with respect to its Shares
or its right to act by written consent, as applicable, in such manner as may be
necessary and appropriate to ensure that a Management Trust Tag-Along Sale may
be consummated.

 

(g) If Investor,
prior to a Qualified Public Offering, proposes to Sell (a “Management Trust
Tag-Along Sale”) Shares which are of the same class as the Shares held by
the Management Trust (the Shares proposed to be Sold in the Management Trust
Tag-Along Sale being referred to as the “Management Trust Tag-Along Shares”)
to a Third Party, Investor shall (i) procure that the buyer to which the
Management Trust Tag-Along Sale is proposed to be made makes a written offer to
the Management Trust to purchase from that Management Trust up to a number of
Shares of the relevant class equal to the portion of that Management Trust’s
Shares representing the same percentage of the total number of Shares held by
that Management Trust as the portion of the Shares being Sold by Investor
represents of the total number of Shares held by Investor immediately prior to
the Management Trust Tag-Along Sale at the same price per Share and otherwise
on customary terms and conditions, which will include procuring that, to the
extent reasonably requested by the Investor, the relevant directors, officers
and employees of NXP and its Subsidiaries that are beneficiaries of the
Management Trust make representations and warranties concerning the relevant
underlying business it being understood that the CEO of NXP shall be entitled
to negotiate such representations and warranties on behalf of the relevant
individuals, such individuals shall be entitled to make fair disclosure against
such representations and warranties and, if and to the extent Investor, acting
in its sole and unfettered discretion, decides to give similar representations
and warranties, any indemnification or other liability thereunder shall be
shared by the Investor and the relevant directors, officers and employees
giving such representations and warranties pro rata according to the number of
ordinary Shares held by them or for their benefit (the “Management Trust
Tag-Along Offer”), (ii) within ten (10) days of agreeing definitive
documentation with respect to the Management Trust Tag-Along Sale provide to
the Management Trust written notice (the “Management Trust

 

21

 

Tag-Along Notice”)
specifying the material terms and conditions of the Management Trust Tag-Along
Sale, including the identity of the buyer to which the Management Trust
Tag-Along Sale is proposed to be made, the price per Share to be paid and the
maximum number of Shares that the Management Trust may sell pursuant to the
Management Trust Tag-Along Offer and (iii) in the event that the Management
Trust accepts the Management Trust Tag-Along Offer, condition the closing of
the Management Trust Tag-Along Sale on the closing of that Management Trust’s
Sale of Shares pursuant to the Management Trust Tag-Along Offer.

 

(h) The Management
Trust may accept a Management Trust Tag-Along Offer within fifteen (15) days of
receiving a Management Trust Tag-Along Notice by providing to Investor on the
one hand and the proposed buyer on the other hand a written notice of
acceptance, specifying the number of Shares that it wishes to Sell to the buyer
pursuant to the Management Trust Tag-Along Offer.

 

(i) Upon
acceptance by the Management Trust of a Management Trust Tag-Along Offer, that
Management Trust shall be deemed to have agreed to Sell the number of Shares
specified in the Management Trust Tag-Along Notice and shall take all such
actions and exercise its voting rights with respect to its Shares or its right
to act by written consent, as applicable, in such manner as may be necessary
and appropriate to ensure that the Management Trust Tag-Along Sale is
consummated.

 

(j) Investor shall
be under no obligation to the Management Trust pursuant to this Section 3.4 as
a result of any decision by Investor not to consummate a Management Trust
Tag-Along Sale (it being understood that such decision shall be made by
Investor in its sole discretion).

 

(k) The Management
Trust shall bear its proportionate share of all third party transaction fees
and expenses (and specifically excluding any transaction fees paid to any
Investor Affiliate) in connection with a Management Trust Tag-Along Sale, such
proportionate share being determined according to the gross proceeds to be
received by each seller in the relevant sale.

 

(l) The Management
Trust shall take all such actions and exercise its voting rights with respect
to its Shares or its right to act by written consent, as applicable, in such
manner as may be necessary and appropriate to ensure that a Philips Tag-Along
Sale may be consummated.

 

(m) If the
transaction giving rise to a Philips Tag-Along Sale or a Management Trust
Tag-Along Sale is triggered by a proposed transaction to Sell Equity Securities
of a Holdco, Investor shall have the right, instead of having to procure that
Philips or the Management Trust, as the case may be, may Sell the Philips
Tag-Along Shares or the Management Trust Tag-Along Shares, as the case may be,
to the relevant Third Party, to require Philips or the Management Trust, as the
case may be, to either, at Investor’s discretion, (i) contribute such Shares to
Holdco (it being understood that such contribution may occur in several steps
via contributions to Investor and any other wholly-owned intermediate entities)
in exchange for Equity Securities issued by Holdco

 

22

 

that are equivalent in
terms of economics to such contributed Shares (taking into account the
provisions of this Agreement) and then to effect a Sale of such Equity Securities
to such Third Party as though such Sale were a Philips Tag-Along Sale or a
Management Trust Tag-Along Sale, as the case may be or (ii) immediately prior
to the time scheduled for the closing of such Sale, to transfer such Shares to
Investor by way of a repurchase and cancellation, subject, in each case, to the
conditions that (i) the Sale of such Equity Securities to such Third Party or
such repurchase and cancellation actually occurs and (ii) as a result of such
Sale or repurchase and cancellation, the net proceeds payable to Philips or the
Management Trust, as the case may be, in respect of the Shares so contributed
or repurchased and cancelled is not less than the net proceeds that would have
been payable to Philips or the Management Trust, as the case may be, if such
Shares had been Sold to such Third Party in a Philips Tag-Along Sale or
Management Trust Tag-Along Sale, as the case may be.

 

Section 3.5. Excluded
Transactions. Notwithstanding anything to the contrary herein, the
restrictions set forth in this Article III shall not prohibit any issuance or
Sale of Shares for cancellation in exchange for other securities of Newco
pursuant to a recapitalization of Newco approved by the Board, it being
understood that the provisions of this Agreement shall apply to any securities
received by Shareholders pursuant to such recapitalization.

 

ARTICLE
IV 

REPRESENTATIONS AND WARRANTIES

 

Section 4.1. Power
and Authority; Valid and Binding Obligations; No Conflict or Violation.
Each Shareholder represents and warrants that:

 

(a) Such
Shareholder has full corporate power and authority to execute and deliver this
Agreement and perform its obligations hereunder.

 

(b) This Agreement
has been duly authorized, executed and delivered by such Shareholder and
constitutes a valid and legally binding agreement of such Shareholder,
enforceable in accordance with its terms, subject, as to enforceability, to
bankruptcy, insolvency, reorganization and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles.

 

(c) Neither the
execution and delivery of this Agreement by such Shareholder nor the
performance by such Shareholder of its obligations hereunder, will (i) violate
any provision of the Organizational Documents of such Shareholder or (ii)
violate or result in a breach of or constitute a default under any Law to which
such Shareholder is subject.

 

ARTICLE V

FINANCIAL REPORTING AND ACCOUNTING

 

Only for so long
as Philips holds a percentage of the outstanding Shares that equals or exceeds
the Philips Minimum Percentage:

 

23

 

Section 5.1. Provision
of Information by Newco to Philips. (a) Newco agrees to provide, or cause
to be provided, to Philips or its designee(s), as promptly as reasonably
practicable upon written request therefor, any Information in the possession or
under the control of any member of the Newco Group that Philips reasonably
requires (i) to comply with reporting, disclosure, filing or other requirements
imposed on any member of the Philips Group by a Governmental Authority having
jurisdiction over such member, including under applicable securities or tax
laws, including the Sarbanes-Oxley Act of 2002 and the rules and regulations
thereunder, or applicable rules of any Self-Regulatory Organization (collectively,
the “Applicable Regulatory Requirements”), (ii) for use in any judicial,
regulatory, administrative, tax or other proceeding or (iii) in order to
satisfy any audit, accounting, claims, regulatory, litigation, tax or other
similar requirements, provided that in the event that Newco determines in its
reasonable discretion that any such provision of Information would result in a
violation of any statute or any order, rule or regulation of any Governmental
Authority having jurisdiction over Newco or any of its Subsidiaries, the
Parties shall take reasonable measures to permit Newco to comply with this
Section 5.1(a) in a manner that avoids any such violation.

 

(b) Disclosure
Controls and Procedures and Internal Controls over Financial Reporting.
During any Reporting Period, Newco shall maintain, at its own cost and expense,
systems of disclosure controls and procedures and internal controls over
financial reporting sufficient to enable Philips to satisfy its reporting,
accounting, audit and other obligations, including under the Sarbanes-Oxley Act
of 2002 and the rules and regulations thereunder, and to provide reasonable
assurance of the adequacy of such controls and procedures to Philips on an
annual basis or more frequently, if requested, in such form and detail as shall
enable Philips to satisfy such obligations, including to the effect that (i)
records are maintained that in reasonable detail accurately and fairly reflect
transactions and dispositions of assets, (ii) transactions are executed in accordance
with management’s general or specific authorizations, (iii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset
accountability, (iv) access to assets is permitted only in accordance with
management’s general or specific authorization and (v) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

 

(c) Philips
Compliance Matters. During any Reporting Period, Newco shall maintain
accounting records and prepare financial statements in compliance with U.S.
GAAP and IFRS in such detail as is necessary in order for Philips to comply with
the Applicable Regulatory Requirements, and in each case respond to requests
from Philips for any such Information as soon as reasonably practicable upon
written request therefor.

 

(d) Record
Retention. To facilitate the delivery of Information pursuant to this 0,
Newco agrees to use its reasonable commercial efforts to retain all Information
in its possession or control on the Closing Date substantially in accordance
with Newco’s policies as in effect on the Closing Date and as may be reasonably
amended from time to time, provided that such policies, as amended, are
consistent with those practices customarily adopted and implemented by listed
public companies.

 

24

 

(e) Production
of Witnesses; Records; Cooperation. Newco shall use its reasonable commercial
efforts to make available to Philips, upon written request, at Philips’s cost
and expense, Newco’s former, current and future officers, employees, other
personnel and agents as witnesses and any books, records or other documents
within its control or which it otherwise has the ability to make available to
the extent that any such person (giving consideration to business demands of
such officers, employees, other personnel and agents) or books, records or
other documents may reasonably be required in connection with any legal,
regulatory, administrative or other proceedings in which Philips may from time
to time become involved.

 

(f) Ownership
of Information. Any Information owned by Newco that is provided to Philips
pursuant to this Article V shall remain the property of Newco. Unless
specifically set forth herein, nothing contained in this Agreement shall be
construed as granting or conferring rights of license or otherwise in respect
of any such Information.

 

(g) Other
Agreements Providing For Delivery of Information. All of Philips’s rights
and Newco’s obligations set forth in this Section 5.1 are subject to Section
6.1.

 

Section 5.2. Auditors
and Audits; Annual and Quarterly Statements and Accounting.

 

(a) Auditors.
Unless Philips otherwise consents, for the purpose of auditing its consolidated
financial statements and providing an audit opinion thereon with respect to any
Reporting Period, Newco shall engage one of Deloitte, Ernst & Young, KPMG and
PricewaterhouseCoopers for the purpose of auditing its consolidated financial
statements and providing an audit opinion thereon, provided that Newco shall
have the right to select a different accounting firm to the extent the audit
committee of Newco reasonably determines that it would be in Newco’s best interests
to select a different accounting firm and such selection would not cause
Philips to violate with the Applicable Regulatory Requirements and provided
that with respect to any Reporting Period, Newco shall, and shall cause its
auditor from time to time (the “Newco Auditor”) to, comply with Philips’s
auditors independence policies with respect to the Philips Group, as amended
from time to time.

 

(b) Annual and
Quarterly Financial Statements. Newco shall provide, and shall cause the
Newco Auditor to provide, to Philips (and each other Shareholder) on a timely
basis all such Information as Philips may require to meet its schedule for the
preparation, printing, filing, and public dissemination of its consolidated
annual and quarterly financial statements for any Reporting Period. Without
limiting the generality of the foregoing, Newco shall on a timely basis provide
to the Newco Auditor sufficiently detailed Information with respect to Newco
and its Subsidiaries to permit the Newco Auditor to take such steps and perform
such reviews, and shall provide such assistance to Philips’s auditor (the “Philips
Auditor”), as may be required by Philips in connection with the preparation
of its consolidated annual and quarterly financial statements for any Reporting
Period. Newco shall use its reasonable commercial efforts to make its

 

25

 

quarterly and annual
results announcements no later than the time at which Philips shall make its
corresponding quarterly and annual results announcements, provided that Newco
shall not be required to incur any additional costs or expenses in connection
with such efforts.

 

(c) Identity of
Personnel Performing Annual Audit and Quarterly Reviews. Newco shall
authorize the Newco Auditor to make available to the Philips Auditors both the
personnel who performed or are performing the annual audits and quarterly
reviews of Newco’s consolidated financial statements and work papers related to
such audits and reviews, in all cases within a reasonable time prior to the
date of the Newco Auditor’s opinion or report thereon so that the Philips
Auditor is able to perform all procedures it considers necessary to take
responsibility for the work of the Newco Auditors as it relates to any opinion
or report to be issued by the Philips Auditor on Philips’s consolidated
financial statements, all within sufficient time to enable Philips to meet its
schedule for the preparation, printing, filing and public dissemination of
Philips’s consolidated annual and quarterly financial statements for any
Reporting Period.

 

(d) Changes to
Accounting Principles and Restatements or Revisions of Financial Statements.
Newco shall give Philips as much prior notice as reasonably practicable of any
proposed changes in its critical accounting policies or significant accounting
principles or any proposed restatement or revision to Newco’s financial
statements, if any such change, restatement or revision could affect Philips’s
consolidated annual or quarterly financial statements for any Reporting Period.
If requested by Philips, Newco will consult with Philips and the Philips
Auditor, and permit Philips and the Philips Auditor to consult with the Newco
Auditor for a reasonable period of time, with respect to any such change,
restatement or revision. Without the prior written approval of Philips, Newco
shall not (i) make any change to any of its accounting policies or principles
or (ii) restate or revise its consolidated financial statements with respect to
any prior Reporting Periods, in each case if such restatement, revision or change
could affect, or could require Philips to restate, revise or change, Philips’s
consolidated financial statements or its future consolidated financial
statements, provided that if in the opinion of the Newco Auditor, Newco’s
failure to make any such restatement, revision or change would cause Newco’s
consolidated financial statements not to be in compliance, in any material
respect, with applicable accounting principles, Newco may make any such
restatement, revision or change after (A) providing Philips with as much prior
notice thereof as reasonably practicable and (B) consulting with Philips and
the Philips Auditor, and permitting Philips and the Philips Auditor to consult
with the Newco Auditor for a reasonable period of time, regarding such change, restatement
or revision.

 

ARTICLE
VI 

CONFIDENTIALITY

 

Section 6.1. Confidentiality.
Each Shareholder agrees that it will not at any time disclose or use any
Confidential Information (as defined below) of which such Shareholder is or
becomes aware, whether or not such information is developed by such
Shareholder, except to the extent that such disclosure or use is directly
related to and required by such Shareholder’s performance of duties, if any,
assigned to such

 

26

 

Shareholder by Newco, or
such Shareholder’s holding, managing or disposing of Shares, or the reporting
requirements from time to time of the Investor or the Investor’s direct or
indirect shareholders, provided that, prior to any such disclosure of
Confidential Information as permitted hereby, such Shareholder shall inform the
person to whom such disclosure is to be made of the confidential nature of such
information and obtain the agreement of such person to be bound by the
provisions of this Section 6.1 if substantially equivalent confidentiality
obligations do not otherwise exist. As used in this Agreement, the term “Confidential
Information” means any and all information (in any form or media)
concerning Newco’s or its Affiliates’ customers, prospective customers
(including lists of customers and prospective customers), methods of operation,
manufacturing processes, trade secrets, research and development activities,
know-how, designs, computer software, business or financial plans, contracts,
distributors, distribution channels, pricing information, billing rates or
procedures, suppliers, vendor lists, business methods, management, employees,
employee compensation, acquisition opportunities, books and records, or any
other business information relating to Newco or its Affiliates (whether constituting
a trade secret or proprietary or otherwise) that has value to Newco or its
Affiliates and is treated by Newco or its Affiliates as being confidential,
provided that Confidential Information shall not include any information that
has been published (through no breach by any Shareholder of its obligations
hereunder) in a form generally available to the public prior to the date a
Shareholder proposes to disclose or use such information, that is required to
be disclosed by Law or that is disclosed by Newco or its Affiliates to a Third
Party that is under no obligation to keep such information confidential.

 

Section 6.2. Information.
Subject only to Section 6.1, nothing in this Agreement will limit the principle
that all information will be made available to the Investor and Philips on the
basis of full transparency and that Newco shall procure that the members of the
Newco Group and their auditors or other relevant advisers supply Investor and
each Investor Director and Philips and each Philips Director with such
financial or management information relating to the Newco Group, its
activities, affairs, plans and prospects as the Investor or Philips may
require, within such timeframe as Investor or Philips may reasonably require.

 

Section 6.3. CFC.
Newco shall provide, and shall use all reasonable endeavors to procure that NXP
and its Subsidiaries provide, to Investor or any Investor Affiliate, as the
case maybe, such information as Investor or such Investor Affiliate may
reasonably request at any time or from time to time in order to permit Investor
or such Investor Affiliate, (a) to determine whether any member of Newco’s
group is a “controlled foreign corporation” (or a corporation having a similar
status) for the purposes of the IRC, (b) to determine the consequences to the
Investor or Investor Affiliate (as relevant) of such status and (c) any other
information that may be reasonably necessary for Investor or such Investor
Affiliate to duly complete and file any income tax returns.

 

27

 

ARTICLE
VII

REGISTRATION OF SUBJECT SECURITIES

 

Section 7.1.        Demand Registration Rights. (a)
Prior to a Qualified Public Offering, Shareholders who, collectively, hold more
than 50% of the Shares and, following a Qualified Public Offering, each
Shareholder (each such Shareholder, the “Demanding Shareholder”) shall
have the right, at any time and from time to time on or after the third
anniversary of the date hereof, to demand that the IPO Entity publish an EU
Prospectus and/or file and have declared effective by the SEC a Registration
Statement for one or more Public Offerings of all or part of the Demanding
Shareholder’s Subject Securities, by giving written notice to the IPO Entity
specifying the number of Subject Securities to be covered by such EU Prospectus
or Registration Statement and the intended method of distribution thereof (the “Demand
Request”). In the event a Demand Request is made prior to a Qualified
Public Offering, the Demanding Shareholder shall forward such Demand Request to
the other Shareholders. In the case of an EU Prospectus, the Demanding
Shareholder may specify that such prospectus shall be in the form of a
registration document, an offering supplement and a summary or such other form
as the AFM or other relevant competent authority may from time to time accept
to facilitate delayed or continuous offerings of securities. In the case of a
Registration Statement, the Demanding Shareholder may specify that such
registration statement shall be in the form of a “shelf” registration statement,
providing for the offer and sale of Subject Securities by the Demanding
Shareholder on a delayed or continuous basis as permitted by the Securities
Act, in which case the intended method of distribution contained in the Demand
Request may be general in nature or contemplate multiple methods of
distribution. Any Demanding Shareholder wishing to deliver a Demand Request
shall notify the IPO Entity of its intention to do so at least fourteen (14)
days prior to its intended date of delivery, and the IPO Entity shall forthwith
negotiate in good faith to determine the timing of the Demand Request and the
number of Subject Securities to be specified therein. If the Demanding
Shareholder and the IPO Entity shall agree such matters within the 14-day
consultation period, the Demand Request shall reflect such agreement; if the
Demanding Shareholder and the IPO Entity fail to agree such matters within the
14-day consultation period, the Demanding Shareholder shall be entitled to
deliver the Demand Request on such terms as the Demanding Shareholder, in its
sole discretion, sees fit.

 

(b)       Each Shareholder shall have the right,
within twenty (20) days of receiving a Demand Request by a Demanding
Shareholder prior to a Qualified Public Offering, or within such lesser period
of time as specified in the Demand Request which shall in any event be at least
five (5) Business Days if the Public Offering is reasonably required to occur
on an accelarated timetable, to request that the IPO Entity include in the
Offer Document all or a portion of the Subject Securities held by such other
Shareholder (a “Participation Request”).

 

(c)       Upon receipt of a Demand Request, the IPO
Entity shall as promptly as practicable file with each applicable Regulator an
Offer Document and shall use its best efforts to obtain the Qualification of
such Offer Document, covering the Subject Securities included in the Demand
Request and, if applicable, the Subject

 

28

 

Securities included in any Participation Request, for disposition in
accordance with the intended method of disposition stated in the Demand
Request.

 

(d)       The IPO Entity shall use reasonable
efforts to keep a Registration Statement that has become effective as
contemplated by Section 7.1 (a) continuously effective and not subject to any
stop order, injunction or other similar order or requirement of the SEC, until
the earlier of (i) the expiration of the SEC Required Period and (ii) the date
on which all Subject Securities covered by the Registration Statement (A) have
been disposed of pursuant to such Registration Statement or (B) cease to be
subject to the registration requirements of the Securities Act, provided that
in no event will such period expire prior to the expiration of the applicable
period referred to in Section 4(3) of the Securities Act and Rule 174
promulgated thereunder. In the event of any stop order, injunction or other
similar order or requirement of the SEC relating to the Registration Statement,
the SEC Required Period shall be extended by the number of days during which such
stop order, injunction or similar order or requirement remains in effect.

 

(e)       The IPO Entity’s obligations under
subsections (a) to (d) are subject to the following limitations:

 

(i)        The IPO Entity shall not be required to
comply with its obligations under subsections (a) to (d) during any period of
time (not to exceed 90 days in the aggregate with respect to each request) with
respect to which it has in good faith decided to proceed with a Public Offering
for its own account and, in the good faith judgment of the managing
underwriters thereof, the compliance with such obligations would have a
material adverse effect on such Public Offering (any such period of time being
hereinafter referred to as a “Blackout Period”); provided that (A) any
such Blackout Period shall terminate earlier upon the completion or abandonment
of such Public Offering, (B) the IPO Entity shall furnish to each Shareholder a
certificate of a member of its Board demonstrating that, prior to the
commencement of the consultation period specified in Section 7.1 (a), it
engaged an investment bank of international standing to conduct the Public
Offering and (C) if during the Blackout Period a Demand Request is withdrawn,
such request shall not be considered a Demand Request and such request shall be
of no further effect.

 

(ii)       The IPO Entity shall not be required to
comply with its obligations under subsections (a) to (d) during any period of
time (not to exceed 90 days in the aggregate with respect to each request) with
respect to which in the good faith judgment of the Board of the IPO Entity it
would be materially detrimental to the IPO Entity and its shareholders for any
EU Prospectus or Registration Statement to be filed because such filing would
(A) require disclosure of material nonpublic information, the disclosure of
which would be reasonably likely to materially adversely affect the IPO Entity
and its Subsidiaries taken as a whole or (B) adversely effect an existing or
prospective material financing, acquisition, merger, disposition or other
comparable transaction or negotiation involving the IPO Entity, provided that
in any such case the IPO Entity shall have the right to

 

29

 

suspend the filing or use
of but not the filing of, any EU Prospectus or Registration Statement and provided
further that the IPO Entity shall not be entitled to exercise this right more
than three times for a period of 90 days each time.

 

(iii)      The minimum aggregate offering price of
the Subject Securities in any Public Offering, as estimated in good faith by
the managing underwriters thereof immediately prior to the time the
Qualification of the relevant Offer Document becomes effective, shall be at
least €250 million (or the equivalent in other currencies).

 

(iv)      The number of Subject Securities to be offered
and sold in any Public Offering shall not exceed the maximum number that the
managing underwriter engaged for the Public Offering considers in good faith to
be appropriate based on market conditions and other relevant factors, including
pricing, the identity of the Shareholders and the proportion of the Subject
Securities being offered and sold by the IPO Entity and the Shareholders (the “Maximum
Number”).

 

(v)       If the number of Subject Securities to be
offered and sold in a Public Offering following a Demand Request exceeds the
Maximum Number, then the aggregate number of Subject Securities to be offered
and sold shall be reduced to the Maximum Number and the IPO Entity shall
include in the Offer Document up to the Maximum Number (A) first, all of the Subject
Securities requested by the Demanding Shareholder and the other requesting
Shareholders to be included in the Offer Document, allocated among them pro
rata on the basis of the number of Subject Securities then held by them and (B)
second, to the extent that the number of Subject Securities to be included in
the Offer Document pursuant to (A) is less than the Maximum Number, any Subject
Securities that the IPO Entity proposes to offer and sell for its own account.

 

(vi)      The IPO Entity shall not be obligated to
give effect to a Demand Request in the event that a registration pursuant to
Section 7.2 has been available to any Shareholder within the ninety (90) days
preceding the date of the Demand Request.

 

(vii)     The IPO Entity shall not be obligated to give
effect to more than two Demand Requests in any twelve-month period.

 

(f)        A request by a Shareholder that the IPO
Entity file an Offer Document shall not be considered a Demand Request if the
Offer Document does not become Qualified.

 

Section 7.2.        Piggyback Registration Rights.
(a) If the IPO Entity proposes to seek Qualification of an Offer Document in
respect of any authorized but unissued Subject Securities for purposes of a
Public Offering of such Subject Securities, the IPO Entity shall give written
notice to each Shareholder of such proposal at least

 

30

 

thirty (30) days before the commencement of preparations for such
Public Offering. Such notice shall specify at a minimum the number of Subject
Securities proposed to be included in the Offer Document, the proposed filing
date of the Offer Document, the proposed method of distribution of the Subject
Securities and the proposed managing underwriters, if any. If the IPO Entity
intends to deliver such a notice, it shall notify each Shareholder of its
intention to do so at least fourteen (14) days prior to its intended date of
delivery, and the IPO Entity and the Shareholders shall forthwith negotiate in
good faith to determine the timing of such notice, the type and amount of
securities to be specified therein and the possibility for permitting the
inclusion of each Shareholder’s Subject Securities in the Offer Document. If
the IPO Entity and the Shareholders shall agree such matters within the
fourteen (14)-day consultation period, the notice given by the IPO Entity to
the Shareholders shall reflect such agreement; if the IPO Entity and the
Shareholders fail to agree such matters within the fourteen (14)-day
consultation period; the IPO Entity shall be entitled to give such notice upon
such terms as it, in its sole discretion, sees fit (any such notice hereinafter
being referred to as an “Override Notice”).

 

(b)       If permitted by the notice given by the
IPO Entity, each Shareholder shall be entitled to submit a written request
within fifteen (15) days after receipt of such notice that all or a portion of
the Subject Securities held by it shall be included in the Offer Document, and
the IPO Entity shall use its best efforts to include in the Offer Document the
Subject Securities referred to in such request, provided that any offer and
sale of such Subject Securities shall be on substantially the same terms and
conditions as the Subject Securities offered and sold by the IPO Entity and
provided further that the number of Subject Securities to be included in the
Offer Document shall not exceed the Maximum Number. If the number of Subject
Securities to be offered and sold in a Public Offering pursuant to Section
7.2(a) exceeds the Maximum Number, the aggregate number of Subject Securities
to be offered and sold shall be reduced to the Maximum Number and the IPO
Entity shall include in the Offer Document up to the Maximum Number (A) first,
all of the Subject Securities that the IPO Entity proposes to offer and sell
for its own account and (B) second, to the extent that the number of Subject
Securities to be included in the Offer Document pursuant to (A) is less than
the Maximum Number, any Subject Securities requested by any requesting
Shareholders to be included in the Offer Document, allocated among them pro rata
on the basis of the number of Subject Securities then held by them. A
Shareholder who has submitted a request to have Subject Securities included in
the Offer Document pursuant to this Section 7.2(b) shall be entitled to
withdraw this request by giving written notice to the IPO Entity of its
election to do so at least five (5) days prior to the proposed date of
Qualification of such Offer Document.

 

(c)       In the event that the IPO Entity delivers
an Override Notice to the Shareholders, then notwithstanding any other
provision of this Agreement, for a period of six months following the later of
the first day of trading of the Subject Securities specified in the Override
Notice or the expiration of any related lock-up period (the “Priority Period”):

 

31

 

(i)        The IPO Entity may not deliver a notice
pursuant to this Section 7.2 without first providing the Shareholders at least
forty-five (45) days’ advance notice thereof and an opportunity for the
Shareholders to deliver a Demand Request, which shall have priority over any
notice delivered by the IPO Entity during the Priority Period;

 

(ii)       Any Demand Request delivered by a
Shareholder during the Priority Period shall be deemed to have been delivered
prior to any notice delivered by the IPO Entity pursuant to this Section 7.2
during the Priority Period.

 

(iii)      The IPO Entity may not refuse to comply
with any Demand Request delivered during the Priority Period on the ground that
it has previously engaged an investment bank to conduct a Public Offering.

 

Section 7.3.        Offer Procedures. If and whenever
the IPO Entity is required by Section 7.1 or Section 7.2 to use its best
efforts to obtain the Qualification of an Offer Document in respect of any
Subject Securities, the following provisions shall apply:

 

(a)       The IPO Entity shall:

 

(i)        As promptly as practicable prepare and
file with each applicable Regulator an Offer Document with respect to the
Subject Securities and use its best efforts to cause such Offer Document to
become and remain Qualified, provided that, before filing any Offer Document or
any amendments or supplements thereto, the IPO Entity shall furnish to and
afford each Shareholder holding Subject Securities covered by such Offer
Document (a “Selling Shareholder”), its advisors and the managing
underwriters (the “Underwriters”), if any, a reasonable opportunity to
review and comment on copies of all such documents (including copies of any
documents to be incorporated by reference therein and all exhibits thereto)
proposed to be filed.

 

(ii)       As promptly as practicable, prepare and
file with each applicable Regulator such amendments and supplements to an Offer
Document as may be necessary to keep the Qualification of the Offer Document
current and effective and to comply with the provisions of applicable law with
respect to the sale or disposition of the Subject Securities.

 

(iii)      Promptly notify each Selling Shareholder
(A) when an Offer Document or any amendment or supplement thereto has been
filed and when it has become Qualified, (B) of any request by any applicable
Regulator for amendments or supplements to an Offer Document or for additional
information or (iii) of any order issued or threatened by any applicable
Regulator suspending the Qualification of an Offer Document; the IPO Entity
shall use its best efforts to prevent the issuance of any such order and, if
any such order is issued, shall use its best efforts to obtain the withdrawal
of such order at the earliest possible moment.

 

32

 

(iv)      Immediately upon becoming aware thereof,
notify each Selling Shareholder and the Underwriters, if any, at any time when
a U.S. Prospectus or an EU Prospectus is required to be made available under
applicable law or regulations, of the occurrence of an event requiring the
preparation of a supplement or amendment to an Offer Document so that, as
thereafter delivered to the purchasers of the Subject Securities, such Offer
Document will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and promptly make available to each Selling Shareholder
and the Underwriters, if any, any such supplement or amendment.

 

(v)       Use its best efforts to register or
qualify the Subject Securities under such securities or blue sky laws of such
jurisdictions in the United States as the Selling Shareholders or the
Underwriters, if any, shall reasonably request, and do any and all other acts
and things that may be reasonably necessary to enable each participating
Selling Shareholder or the Underwriters, if any, to consummate the disposition
of the Subject Securities in such jurisdictions, provided that in no event
shall the IPO Entity be required to qualify to do business as a foreign
corporation in any jurisdiction where it is not so qualified, or to execute or
file any general consent to service of process under the laws of any
jurisdiction.

 

(vi)      Make available upon reasonable advance
notice for inspection by any Selling Shareholder, any Underwriters and any
attorney, accountant or other professional retained by any such Selling
Shareholder or Underwriter (collectively, the “Advisors”), all financial
and other records, pertinent corporate documents and properties of the IPO
Entity (collectively, the “Records”) as shall be reasonably necessary to
enable them to conduct a “reasonable” investigation for purposes of Section
11(a) of the Securities Act and other applicable antifraud and securities laws
and cause the IPO Entity’s directors, officers and employees to supply all
information reasonably requested by any Advisors in connection with such Offer
Document.

 

(vii)     Use its best efforts to cause all Subject
Securities covered by-an Offer Document to be listed or qualified for trading
on any stock exchange or quotation service on which the IPO Entity’s
outstanding equity securities are listed or qualified for trading or, if none
of the IPO Entity’s outstanding equity securities are listed or qualified for
trading on any stock exchange or quotation services, a generally recognized and
generally accepted stock exchange or quotation service in the United States or
Europe.

 

(viii)    Furnish to each Selling Shareholder and each
Underwriter, if any, such number of copies of an Offer Document, each amendment
and supplement thereto (in each case including all exhibits thereto and
documents incorporated by reference therein) and such other documents as such
Selling Shareholder or Underwriter may reasonably request in order to facilitate
the disposition of the Subject Securities owned by such Selling Shareholder.

 

33

 

(ix)       In connection with an underwritten
offering of Subject Securities, enter into an underwriting agreement in such
form as is customary in underwritten offerings made by selling security holders
and take all such other actions as are reasonably requested by the Underwriters
in order to expedite or facilitate the registration or the disposition of such
Subject Securities, and in such connection (A) make such representations and
warranties to the Underwriters with respect to the business of the IPO Entity
and its Subsidiaries, and the relevant Offer Document and documents, if any,
incorporated or deemed to be incorporated by reference therein, as are
customarily made by issuers to underwriters in underwritten offerings made by
selling security holders, and confirm the same on the settlement date for the
offering, (B) cause opinions of counsel to the IPO Entity (which counsel and
opinions shall be reasonably satisfactory to the managing underwriters) to be
delivered to the Underwriters covering the matters customarily covered in
opinions requested in underwritten offerings by selling security holders, (C)
cause “cold comfort” letters and updates thereof (which letters and updates
shall be reasonably satisfactory to the managing underwriters) from the
independent certified public accountants of the IPO Entity (and, if necessary,
any other independent certified public accountants of any Subsidiary or equity
investee of the IPO Entity or of any business acquired or owned by the IPO
Entity for which financial statements and financial data are, or are required
to be, included in the Offer Document) to be delivered to the Underwriters,
such letters to be in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with underwritten
offerings by selling security holders and (D) agree to customary
indemnification and contribution provisions in favor of both the Selling
Shareholders and the Underwriters or selling agents.

 

(x)        Comply with all applicable rules and
regulations of each applicable Regulator and, in the case of a U.S. Public
Offering, make generally available to security holders earning statements
satisfying the provisions of Section II (a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) not later
than forty-five (45) days after the end of any 12-month period (or 90 days
after the end of any twelve (12)-month period if such period is a fiscal year)
(A) commencing at the end of any fiscal quarter in which Subject Securities are
offered and sold in a Public Offering and (B) if not sold to underwriters in
such an offering, commencing on the first day of the fiscal quarter of the IPO
Entity after the effective date of a Registration Statement, which statements
shall cover said twelve (12)-month period.

 

(xi)       Cooperate with each Selling Shareholder
and the Underwriters in connection with any filings required to be made with any
Self-Regulatory Organization.

 

(xii)      Use its best efforts to take all other
steps reasonably necessary to effect the Qualification, offering and sale of
the Subject Securities covered by an Offer Document and enter into any other
customary agreements and take such

 

34

 

other actions, including
participation in “road shows”, as are reasonably required in order to expedite
or facilitate the disposition of the Subject Securities.

 

(b)       Each Selling Shareholder shall agree to
any lock-up restrictions requested by the Underwriters prohibiting and/or
restricting the transfer of Subject Securities and any hedging or other trading
activities with respect to such securities, provided that the form of lock-up
agreement agreed to by Investor and the Management Trust shall be substantially
the same as that required of any other Selling Shareholder.

 

Section 7.4.        Expenses, (a) All fees and
expenses incident to the Qualification and offer and sale of the Subject
Securities in a Public Offering pursuant to Section 7.1 or Section 7.2 shall be
borne by the IPO Entity, including (a) all registration and filing fees
(including (i) fees with respect to filings required to be made with any
Self-Regulatory Organization and (ii) fees and expenses of compliance with
state securities or blue sky laws (including fees and disbursements of counsel
for the IPO Entity and the Underwriters in connection with such matters)), (b)
printing expenses (including any costs of printing certificates for Subject
Securities in a form eligible for deposit with clearing agencies, printing EU
Prospectuses and U.S. Prospectuses, and printing or preparing any underwriting
agreement, agreement among underwriters and related syndicate or selling group
agreements, pricing agreements and blue sky memoranda), (c) the fees and
expenses of any “qualified independent underwriter” or other independent
appraiser participating in an offering pursuant to the conduct rules of the
NASD, (d) the expenses and costs of any road show (including travel, meals,
accommodation and other arrangements for investor presentations or meetings);
(e) the fees, expenses and costs of any public relations, investor relations or
other consultants retained in connection with any road show (including travel
and other arrangements for any investor presentations or meetings); (f) fees
and disbursements of counsel for the IPO Entity, (g) fees and disbursements of
all independent certified public accountants for the IPO Entity (including the
expenses of any “cold comfort” letters required by or incident to such
performance) and (h) costs and expenses incurred in connection with the
quotation or listing of the Subject Securities on any securities exchange or
automated securities quotation system.

 

(b)       Notwithstanding anything to the contrary
in Section 7.4(a), the IPO Entity will bear all costs and expenses associated
with any offering-related liability insurance, if the IPO Entity desires to
obtain such insurance.

 

Section 7.5.        Indemnification. (a) In
connection with any Offer Document in respect of any Public Offering pursuant
to this Article VII, the IPO Entity shall agree to indemnify and hold harmless
each Selling Shareholder and each Underwriter, if any, and each of their
respective officers, directors or employees, each Person, if any, who controls
such Selling Shareholder or such Underwriter within the meaning of Section 15
of the Securities Act, Section 20 of the Exchange Act and each Person of which,
under the laws of The Netherlands, such Selling Shareholder or such
Underwriter, directly or indirectly, is a subsidiary (dochtermaatschappij) or group company (groepsmaatschappij), from and against any
and all losses, claims, damages and liabilities (“Losses”) and any
actions in respect thereof (including any legal or other

 

35

 

expenses incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in any Offer Document, EU Prospectus,
U.S. Prospectus, Issuer Free Writing Prospectus or form of prospectus (as
amended or supplemented if the IPO Entity shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to state
therein a material fact necessary to make the statements therein in the light
of the circumstances under which they were made not misleading, except insofar
as such losses, claims, damages or liabilities or actions in respect thereof
are caused by any such untrue statement or omission or alleged untrue statement
or omission based upon (i) any information relating to any Selling Shareholder
furnished to the IPO Entity by or on behalf of such Selling Shareholder
expressly for use therein or (ii) any information relating to such Underwriter
furnished to the IPO Entity by such Underwriter expressly for use therein.

 

(b)       In connection with any Offer Document in
respect of any Public Offering pursuant to Article VII in which a Shareholder
is not participating, the IPO Entity shall indemnify and hold harmless such
Shareholder and its officers, directors or employees, each Person, if any, who
controls such Selling Shareholder within the meaning of Section 15 of the
Securities Act, Section 20 of the Exchange Act and each Person of which, under
the laws of The Netherlands, such Shareholder, directly or indirectly, is a
subsidiary (dochtermaatschappij) or
group company (groepsmaaischappij), from
and against any and all losses, claims, damages and liabilities and any actions
in respect thereof (including any legal or other expenses incurred in connection
with defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in an Offer
Document, EU Prospectus, U.S. Prospectus, Issuer Free Writing Prospectus or
form of prospectus (as amended or supplemented if the IPO Entity shall have
furnished any amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading, except insofar as such losses, claims, damages or liabilities
or actions in respect thereof are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information
provided by such Shareholder to the IPO Entity in writing expressly for use
therein.

 

(c)       Each Selling Shareholder shall agree to
indemnify and hold harmless the IPO Entity and each Underwriter, if any, and
each of their respective officers, directors or employees, each Person, if any,
who controls any such Underwriter within the meaning of either Section 15 of
the Securities Act, Section 20 of the Exchange Act and each Person of which,
under the laws of The Netherlands, the IPO Entity or such Underwriter, directly
or indirectly, is a subsidiary (dochtermaatschatppij)
or group company (groepsmaaischappij),
from and against any and all losses, claims, damages and liabilities
and any actions in respect thereof (including any legal or other expenses
incurred in connection with defending or investigating any such action or
claim) caused by any untrue statement or alleged untrue statement of a material
fact contained in any Offer Document or any amendment thereof, or any EU
Prospectus, U.S. Prospectus or form of prospectus (as amended or supplemented
if the IPO Entity shall have furnished any amendments or supplements thereto),
or caused by any omission or alleged omission

 

36

 

to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only with respect
to any information relating to such Selling Shareholder furnished to the IPO
Entity by or on behalf of such Selling Shareholder expressly for use therein.

 

(d)       In the event a claim arises pursuant to
subsection (a) through (c), any person in respect of which indemnification may
be sought (the “Indemnified Party”) shall notify the Party against whom
the claim for indemnification is made of such claim and the facts constituting
the basis for such claim in reasonable detail. The Party against whom the claim
for indemnification is made is hereinafter referred to as the “Indemnifying
Party”. Failure to notify an Indemnifying Party shall not relieve such
Indemnifying Party from its obligations hereunder to the extent it is not
materially prejudiced as a result thereof.

 

(e)       Counsel to the Indemnified Party shall be
selected by the Indemnifying Party and shall be reasonably satisfactory to the
Indemnified Party, provided that counsel to the Indemnified Party shall not
(except with the consent of the relevant Indemnified Party) also be counsel to
the Indemnifying Party. The Indemnifying Party may participate at its own
expense in the defense of any claim arising pursuant to subsections (a) through
(c) and, to the extent it shall wish and be legally permitted, assume the
defense thereof, jointly with any other Indemnifying Party similarly notified,
provided, however, that in the event the Indemnified Party shall have
reasonably concluded that there may be defenses available to it that are
different from or additional to those available to the Indemnifying Party, the
Indemnifying Party shall not have the right to direct the defense of such
action as it relates to such defenses on behalf of such Indemnified Party and
the fees and expenses of separate counsel (selected by the Indemnified Party
and reasonably satisfactory to the Indemnifying Party) relating to such
defenses for such Indemnified Party shall be borne by the Indemnifying Party.
After notice from the Indemnifying Party to such Indemnified Party of its
election to assume the defense of any such claim and after election of counsel
to the Indemnified Party as set forth above, the Indemnifying Party shall not
be liable for any legal expenses of other counsel (except for separate counsel,
but not more than the costs of one such separate counsel for all Indemnified
Parties, in the circumstances described above) subsequently incurred by such
Indemnified Party. Except as provided in the preceding sentences, the
Indemnifying Party shall not be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from its own counsel for
all Indemnified Parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No Indemnifying Party shall, without the
prior written consent of the Indemnified Parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification could
be sought under this Section 7.5 (whether or not the Indemnified Parties are actual
or potential parties thereto), unless such settlement, compromise or consent
(i) includes an unconditional release of each Indemnified Party from all
liability arising out of such litigation or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act by or
on behalf of any Indemnified Party.

 

37

 

(f)        If at any time an Indemnified Party
shall have requested an Indemnifying Party to reimburse the Indemnified Party
for fees and disbursements of counsel, such Indemnifying Party agrees that it
shall be liable for any settlement effected without its written consent if (i)
such settlement is entered into more than forty-five (45) days after receipt by
such Indemnifying Party of the aforesaid request, (ii) such Indemnifying Party
shall have received notice of the terms of such settlement at least thirty (30)
days prior to such settlement taking effect and (iii) such Indemnifying Party
shall not have reimbursed such Indemnified Party in accordance with such request
prior to the date of such settlement. Notwithstanding the immediately preceding
sentence, if at any time an Indemnified Party shall have requested an
Indemnifying Party to reimburse the Indemnified Party for fees and
disbursements of counsel, an Indemnifying Party shall not be liable for any
settlement effected without its consent if such Indemnifying Party (i)
reimburses such Indemnified Party in accordance with such request to the extent
it considers such request to be reasonable and (ii) provides written notice to
the Indemnified Party substantiating the unpaid balance as unreasonable, in
each case prior to the date of such settlement.

 

(g)       The indemnity and reimbursement
obligations under this Section 7.5 shall be in addition to any liability each Indemnifying
Party may otherwise have and shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any Indemnified
Party but may be modified as appropriate and agreed by the Parties in
connection with entering any customary underwriting agreement which may, among
other matters, provide for contribution arrangements.

 

(h)       In the event of any conflict between the
provisions set forth in this Section 7.5 and those set forth in any
underwriting agreement entered pursuant to this Article VII, the underwriting
agreement shall control.

 

Section 7.6.        No Shareholder Consent Necessary to
Conduct a Public Offering. Notwithstanding anything in this Agreement to
the contrary, Philips shall not have the right to object to a Public Offering
initiated by Newco, Investor or the Management Trust.

 

ARTICLE
VIII

MISCELLANEOUS

 

Section 8.1.        Termination. The provisions of
Article II shall terminate on the date Philips no longer holds a percentage of
the outstanding Shares that equals or exceeds the Philips Minimum Percentage.
With respect to Philips, this Agreement shall terminate on the date that
Philips ceases to owns any Shares of Newco. With respect to the Management
Trust, this Agreement shall terminate on the date that the Management Trust
ceases to owns any Shares of Newco. This Agreement shall also terminate, except
for Article VI, on the date of consummation of a Qualified Public Offering,

 

Section 8.2.        Additional Securities. Any
Additional Securities shall be considered Shares for purposes of this Agreement
and shall be subject to the provisions hereof.

 

38

 

Section 8.3.        Notices. All notices and
communications under this Agreement shall be deemed to have been duly given and
made if in writing and if served by personal delivery upon the party for whom
it is intended or delivered by registered or certified mail, return receipt
requested, or if sent by telecopier or email, provided that the telecopy or
email is promptly confirmed by telephone confirmation thereof, to the person at
the address set forth below, or such other address as may be designated in
writing hereafter, in the same manner, by such person:

 

To Investor or the
initial Investor Representative:

 

KASLION Holding B.V.

High Tech Campus 60

5656 AG Eindhoven

The Netherlands

Telephone: (31) 20 5407575

Telecopy: (31) 20 5407500

Email: erik.thyssen@alpinvest.com

Ann: Erik Thyssen

 

With a copy to:

 

Clifford Chance LLP

Droogbak IA

1013 GE Amsterdam

The Netherlands

Telephone: (31) 20 711-9000

Telecopy: (31) 20 711-9999

Email: thijs.alexander@cliffordchance.com

Attn: Thijs Alexander

 

Kohlberg Kravis Roberts
& Co. Ltd.

Stirling Square

7 Carlton Gardens

London

SW1Y 5AD

United Kingdom

Telephone: (44) 207 839-9800

Telecopy: (44) 207 839-9801

Email: huthj@kkr.com

Attn: Johannes Huth 

 

39

 

Silver Lake Management
Company, L.L.C.

2775 Sand Hill Road,
Suite 100

Menlo Park, CA 94025

United States

Telephone: (650) 233-8158

Telecopy: (650) 233-8125

Email: karen.king@silverlake.com

Ann: Karen King, General Counsel

 

Bain Capital, Ltd.

Devonshire House

Mayfair Place

London WIJ 8AJ

United Kingdom

Telephone: (44) 20 7514 5252

Telecopy: (44) 20 7514 5250

Email: mplantevin@baincapital.com

Attn: Michel Plantevin

 

Apax Partners
Beteiligungsberatung GmbH

Possartstrasse 11
 8l679 München
 Germany

Telephone: (49) 89 998909 0

Telecopy: (49) 89 998909 33

Email: Christian.Reitberger@apax.de

Attn: Christian Reitberger

 

Alplnvest Partners CS
Investments 2006 C.V.

Jachthavenweg 118

1081 KJ Amsterdam

The Netherlands

Telephone: (31) 20 5407575

Telecopy: (31) 20 5407500

Email:
erik.thyssen@alpinvest.com

Attn: Erik Thyssen

 

40

 

To Philips:

 

Koninklijke Philips
Electronics N.V.

Breitner Center,

Amstelplein 2,

1096 BC Amsterdam,

The Netherlands

Telephone: (31) 20 597-7232

Telecopy: (31) 20 597-7150

Email: eric.coutinho@philips.com

Attn: Eric Coutinho

 

With
a copy to:

 

Sullivan
& Cromwell LLP

I New Fetter Lane

London EC4A 1AN

United Kingdom

Telephone: (44) 20 7959-8900

Telecopy: (44) 20 7959-8950

Email: brayg@sullcrom.com

Attn: Garth W. Bray

 

and

 

De
Brauw Blackstone Westbroek

Tripolis

Burgerweeshuispad 301

1076 HR Amsterdam

Telephone: (31) 20 577-1421

Telecopy: (31) 20 577-1874

Email: arne.grimme@debrauw.com

Attn: Arne Grimme

 

To
Newco:

 

KASLION
Acquisition B.V.

High Tech Campus 60

5656 AG Eindhoven

The Netherlands

Telephone: (31) 20 5407575

Telecopy: (31) 20 5407500

Email: erik.thyssen@alpinvest.com

Attn: Erik Thyssen

 

41

 

With
a copy to:

 

Clifford Chance LLP

Droogbak 1A

1013 GE Amsterdam

The Netherlands

Telephone: (31) 20 711-9000

Telecopy: (31) 20 711-9999

Email: thijs.alexander@cliffordchance.com

Attn: Thijs Alexander

 

Kohlberg Kravis Roberts
& Co. Ltd.

Stirling Square

7 Carlton Gardens

London

SW1Y 5AD

United Kingdom

Telephone: (44) 207 839-9800

Telecopy: (44) 207 839-9801

Email: huthj@kkr.com

Attn: Johannes Huth

 

Silver Lake Management
Company, L.L.C.

2775 Sand Hill Road, Suite 100

Menlo Park, CA 94025

United States

Telephone: (650) 233-8158

Telecopy: (650) 233-8125

Email: karen.king@silverlake.com

Attn: Karen King, General Counsel

 

Bain Capital, Ltd.

Devonshire House

Mayfair Place

London W1J 8AJ

United Kingdom

Telephone: (44) 20 7514 5252

Telecopy: (44) 20 7514 5250

Email: mplantevin@baincapital.com

Attn: Michel Plantevin

 

42

 

Apax Partners
Beteiligungsberatung GmbH

Possartstrasse 11
 81679 Munchen

Germany

Telephone: (49) 89 998909 0

Telecopy: (49) 89 998909 33

Email: Christian.Reitberger@apax.de

Attn: Christian Reitberger

 

AlpInvest Partners CS
Investments 2006 C.V.

Jachthavenweg 118

1081 KJ Amsterdam

The Netherlands

Telephone: (31) 20 5407575

Telecopy: (31) 20 5407500

Email: erik.thyssen@alpinvest.com

Attn: Erik Thyssen

 

To NXP:

 

NXP B.V.

High Tech Campus

Professor Holstlaan 4

Buidling HTC – 60

5656 AA Eindhoven

The Netherlands

Telephone: (31) 40 272-2041

Telecopy: (31) 40 272-4005

Email: guido.dierick@philips.com

Attn: Guido Dierick

 

To Stichting Management:

 

Stichting Management
Co-Investment NXP

High Tech Campus 60

5656 AG Eindhoven

The Netherlands

Telephone: +31 (0) 40 272 3028

Telecopy: +31 (0) 40 272 3093

Email: frans.van.houten@philips.com

Attn: Frans van Houten

 

43

 

With a copy to:

 

Clifford Chance LLP

Droogbak 1A

1013 GE Amsterdam

The Netherlands

Telephone: (31) 20 711-9000

Telecopy: (31) 20 711-9999

Email: thijs.alexander@cliffordchance.com

Attn: Thijs Alexander

 

Kohlberg Kravis Roberts
& Co. Ltd.

Stirling Square

7 Carlton Gardens

London

SW1Y 5AD

United Kingdom

Telephone: (44) 207 839-9800

Telecopy: (44) 207 839-9801

Email: huthj@kkr.com

Attn: Johannes Huth

 

Silver Lake Management
Company, L.L.C.

2775 Sand Hill Road, Suite 100

Menlo Park, CA 94025

United States

Telephone: (650) 233-8158

Telecopy: (650) 233-8125

Email: karen.king@silverlake.com

Attn: Karen King, General Counsel

 

Bain Capital, Ltd.

Devonshire House

Mayfair Place

London W1J 8AJ

United Kingdom

Telephone: (44) 20 7514 5252

Telecopy: (44) 20 7514 5250

Email: mplantevin@baincapital.com

Attn: Michel Plantevin

 

44

 

Apax Partners
Beteiligungsberatung GmbH

Possartstrasse 11

81679 Munchen

Germany

Telephone: (49) 89 998909 0

Telecopy: (49) 89 998909 33

Email: Christian.Reitberger@apax.de

Attn: Christian Reitberger

 

AlpInvest Partners CS
Investments 2006 C.V.

Jachthavenweg 118

1081 KJ Amsterdam

The Netherlands

Telephone: (31) 20 5407575

Telecopy: (31) 20 5407500

Email: erik.thyssen@alpinvest.com

Attn: Erik Thyssen

 

Each such notice, request
or communication shall be effective when received or, if given by mail, when
delivered at the address or addresses specified in this Section or on the fifth
business day following the date on which such communication is posted,
whichever occurs first.

 

Section 8.4.        Amendment; Waiver. Any provision
of this Agreement may be amended or waived if, and only if, such amendment or
waiver is in writing and signed, in the case of an amendment, by Investor and
the Management Trust, on the one hand, and Philips, on the other hand, or in
the case of a waiver, by the Party against whom the waiver is to be effective.
No failure or delay by any Party in exercising any right, power or privilege
under this Agreement shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies in
this Agreement provided shall be cumulative and not exclusive of any rights or
remedies provided by Law.

 

Section 8.5.        No Assignment or Benefit to Third
Parties. This Agreement shall be binding upon and inure to the benefit of
the Parties and their respective successors, legal representatives and
permitted assigns. Except as permitted in Article III, no  Party may assign any of its rights or
delegate any of its obligations under this Agreement, by operation of Law or
otherwise, without the prior written consent of the other Parties, except that
any Shareholder who is not a natural Person may assign its rights and obligations
under this Agreement to its wholly-owned subsidiary, and that Investor may
assign its rights and obligations under this Agreement to an Investor
Affiliate, in each case, without any such consent, provided that such
wholly-owned subsidiary or Investor Affiliate, as the case may be, agrees in
writing to be bound by this Agreement.

 

45

 

Section 8.6.        Entire Agreement. This Agreement
contains the entire agreement between the Parties with respect to the subject
matter hereof and thereof and supersedes all prior agreements and
understandings, oral or written, with respect to such matters.

 

Section 8.7.        Dispute Resolution. The Parties
acknowledge and agree that it is their mutual desire and intention to work
together to fulfill their respective obligations under this Agreement.
Nevertheless, the Parties acknowledge that in the course of working together
for such purpose, there may arise differences of opinion or conflicts as to the
nature or extent of such obligations (“Disputes”). In the event that
Investor or Philips, as the case may be (the “Initiator”), identifies a
matter or matters that it believes have evolved to the status of a Dispute,
Philips or Investor, as the case may be (the “Respondent”), agree to
follow the procedure set forth below:

 

(a)       Immediately following identification of a
Dispute, the Initiator shall give the Respondent written notice (the “Initiating
Notice”) of the particulars of the Dispute and the Initiator’s desire to
resolve it. The Initiating Notice shall also provide (i) the names of one or
more representatives of the Initiator designated to serve as contact persons
for the Dispute and (ii) the proposed place, date and time of a meeting with
the Respondent for the purpose of resolving the Dispute.

 

(b)       Upon receipt of an Initiating Notice, the
Respondent shall provide the names of one or more representatives of the
Respondent designated to serve as contact persons for the Dispute.

 

(c)       The representatives of the Initiator and
the Respondent shall proceed to meet with each other at the place, date and
time proposed by the Initiator or at such other place, date and time as the
Initiator and the Respondent may agree (the “Initial Meeting”). In no
event shall the Initial Meeting be held more than thirty (30) days after the
date of the Initiating Notice.

 

(d)       If the Dispute is not resolved to the
satisfaction of the Initiator and Respondent at the Initial Meeting or within
fourteen (14) days thereafter, Investor Representative and a designated officer
of Philips shall for a period of thirty (30) days attempt to resolve the
Dispute in good faith and in a reasonable manner, including by holding at least
one meeting at which each of them is present in person (the “Executive  Period”).

 

(e)       If, and only if, the Initiator and
Philips have followed the procedure provided by this Section 8.7 and following
the expiration of the Executive Period the Dispute is not resolved to the
satisfaction of Investor and Philips, the Initiator or any other Party may
bring an action or proceeding in a Chosen Court in accordance with Section 8.8.

 

Section 8.8.        Governing Law; Submission to
Jurisdiction; Selection of Forum; Waiver of Trial by Jury. This Agreement
and any agreements to be entered into pursuant to it, save as expressly
otherwise provided therein, shall be governed by and

 

46

 

construed in accordance with the laws of The Netherlands. The Parties
irrevocably agree that all disputes which may arise out of or in connection
with this Agreement and the existence and validity thereof, shall be exclusively
resolved by the district court of Amsterdam, The Netherlands.

 

Section 8.9.        Counterparts. This Agreement may
be executed in one or more counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same Agreement.

 

Section 8.10.      Headings. The heading references in
this Agreement and the table of contents hereof are for convenience purposes
only, and shall not be deemed to limit or affect any of the provisions hereof.

 

Section 8.11.      Severability. The provisions of this
Agreement shall be deemed severable and the invalidity or unenforceability of
any provision shall not affect the validity or enforceability of the other
provisions hereof. If any provision of this Agreement, or the application
thereof to any Person or any circumstance, is invalid or unenforceable, (a) a
suitable and equitable provision shall be substituted therefor in order to
carry out, so far as may be valid and enforceable, the intent and purpose of
such invalid or unenforceable provision and (b) the remainder of this Agreement
and the application of such provision to other Persons or circumstances shall
not be affected by such invalidity or unenforceability, nor shall such
invalidity or unenforceability affect the validity or enforceability of such provision,
or the application thereof, in any other jurisdiction.

 

47

 

IN WITNESS WHEREOF, the
Parties have caused this Agreement to be executed as of the day and year first
above written.

 

 

	
   

  	
   

  	
  NXP B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Guido Dierick

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Guido Dierick

  
	
   

  	
   

  	
   

  	
  Title:

  	
  General Counsel

  
						

 

 

	
   

  	
   

  	
  KASLION Acquisition
  B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  Koninklijke Philips
  Electronics N.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Eric Coutinho

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Eric Coutinho

  
	
   

  	
   

  	
   

  	
  Title:

  	
  General Secretary

  
						

 

 

	
   

  	
   

  	
  KASLION Holding B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  Stichting Management
  Co-Investment NXP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

[Shareholders Agreement
Signature Page]

 

 

IN WITNESS WHEREOF, the
Parties have caused this Agreement to be executed as of the day and year first
above written.

 

	
   

  	
   

  	
  Philips Semiconductors
  International B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  KASLION Acquisition
  B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Illegible

  
	
   

  	
   

  	
   

  	
  Title:

  	
  DIRECTOR

  
						

 

 

	
   

  	
   

  	
  Koninklijke Philips
  Electronics N.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  representing AlpInvest
  Partners N.V. in its turn

  	
   

  	
  By:

  	
   

  	
   

  
	
  representing AlpInvest
  Partners 2006 B.V.

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  KASLION Holding B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Illegible

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Illegible

  
	
   

  	
   

  	
   

  	
  Title:

  	
  MANAGER

  
						

 

 

	
   

  	
   

  	
  Stichting Management Co-Investment
  NXP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

[Shareholders Agreement
Signature Page]

 

 

IN WITNESS WHEREOF, the
Parties have caused this Agreement to be executed as of the day and year first
above written.

 

	
   

  	
   

  	
  Philips Semiconductors
  International B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  KASLION Acquisition
  B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  Koninklijke Philips
  Electronics N.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  KASLION Holding B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

	
   

  	
   

  	
  Stichting Management
  Co-Investment NXP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Johannes Huth

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Johannes Huth

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

[Shareholders Agreement
Signature Page]

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