Exhibit 2.2
AMENDMENT NO. 1
dated as of June 16, 1999
to the
AGREEMENT AND PLAN OF RECAPITALIZATION AND MERGER
dated as of March 13, 1999
by and among
HYUNDAI ELECTRONICS INDUSTRIES CO., LTD.,
HYUNDAI ELECTRONICS AMERICA,
CHIPPAC, INC.,
and
CHIPPAC MERGER CORP.
This AMENDMENT NO. 1 dated as of June 16, 1999 ("Amendment No. 1") to the
AGREEMENT AND PLAN OF RECAPITALIZATION AND MERGER, dated as of March 13, 1999
(the "Original Recapitalization Agreement"), is made and entered into by and
among Hyundai Electronics Industries Company, Ltd., a Republic of Korea
corporation ("HEI"), Hyundai Electronics America, a California corporation
("HEA"), ChipPAC, Inc., a California corporation (the "Company"), and ChipPAC
Merger Corp., a Delaware corporation ("Merger Sub"). Capitalized terms not
otherwise defined herein have the meanings set forth in the Original
Recapitalization Agreement.
Recitals
--------
The parties have heretofore entered into the Original Recapitalization
Agreement. The parties now wish to amend certain provisions of the Original
Recapitalization Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Amendment No. 1, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Section 1. The definition of "Cash Consideration" in Section 1.1 of the
Original Recapitalization Agreement is hereby amended and restated so as to read
in its entirety as follows:
""Cash Consideration" means an aggregate total of three hundred
eighty-five million dollars ($385,000,000), comprised of (i) the sum of (A)
the Korean Stock Sale Proceeds before adding or subtracting the Korean
Stock Sale Adjustments, (B) the Chinese Equity Sale Proceeds before
subtracting the Chinese Debt Payoff and the Chinese Intercompany Payoff,
(C) the ChipPAC Korea Note payment plus the Estimated Korean Debt Payoff,
and (D) the Intellectual Property Note payment, minus (ii) forty million
dollars ($40,000,000) (constituting the amount of the HEA Investment)."
Section 2. The following definition is hereby added to Section 1.1 of the
Original Recapitalization Agreement:
""HEA Investment" has the meaning assigned in Section 2.2(k)."
Section 3. The introductory paragraph of Section 2.2 of the Original
Recapitalization Agreement is hereby amended to insert the words "and subsection
(k)" immediately following each appearance of the phrase "subsections (a)
through (g)".
Section 4. The reference in each of Section 2.2(e)(ii) and Section
2.2(f)(i) to "sixty-seven million dollars ($67,000,000)" is hereby deleted and
replaced with "one hundred seven million dollars ($107,000,000)".
Section 5. Section 2.2(e)(iv)(C) of the Original Recapitalization
Agreement is hereby
-2-
amended and restated so as to road in its entirety as follows:
"(C) one hundred eleven million dollars ($111,000,000) to ChipPAC BVI;"
Section 6. The following Section 2.2(k) is hereby added to the Original
Recapitalization Agreement:
"(k) Purchase of Company Senior Preferred Stock. At the Closing, HEA
shall purchase from the Company, for forty million dollars ($40,000,000) in
cash, Company Senior Preferred Stock with an aggregate liquidation value of
forty million dollars ($40,000,000) (the "HEA Investment")."
Section 7. Section 2.3(a)(i)(y) of the Original Recapitalization Agreement
is hereby amended and restated so as to read in its entirety as follows:
"(y) to HEA or HEI, as HEA shall direct by written notice to Merger
Sub not less than two Business Days prior to the Closing: Company Senior
Preferred Stock with an initial aggregate liquidation value of thirty
million dollars ($30,000,000) (together with the HEA Investment, the
"Preferred Stock Consideration"), up to twenty million dollars
($20,000,000) of which shall be subject to redemption pursuant to the earn-
out provisions of the first sentence of Section 2.5;"
Section 8. The first sentence of Section 2.5 of the Original
Recapitalization Agreement is hereby amended and restated so as to read in its
entirety as follows:
"HEI will be eligible to receive from the Company additional consideration
(the "HEI Earn-Out") during the four (4) year period commencing January 1,
1999 (the "Earn-Out Period"), payable annually, if earned (the "Earn-Out
Payment"), and calculated in the manner set forth below; provided, however,
that the HEI Earn-Out shall not exceed the aggregate amount of fifty-five
million dollars ($55,000,000) (the "Earn-Out Maximum"); provided further,
that, subject to Section 2.5(f), if aggregate Earn-Out Payments shall
exceed the sum of thirty-five million dollars ($35,000,000), the portion of
the HEI Earn-Out in excess of thirty-five million dollars ($35,000,000)
shall be paid by, and applied to, the redemption of a number of shares of
Company Senior Preferred Stock with an aggregate Liquidation Preference as
defined in the Amended and Restated Articles of Incorporation annexed as
Exhibit C to this Agreement (including accrued and unpaid dividends to the
time of such redemption) equal to the amount of such excess (which shares
of Company Senior Preferred Stock shall then be canceled and retired); and
provided further, that the Earn-Out Maximum and the Company's obligation to
pay the Earn-Out Payment in the manner described in the immediately
preceding proviso shall be reduced on a dollar-for-dollar basis to the
extent of the last twenty million dollars ($20,000,000) of then-outstanding
Company Senior Preferred Stock issued to HEA (measured on the basis of
-3-
Liquidation Preference at the time of redemption) which is redeemed other
than pursuant to the terms of this Section 2.5. It is the intention of the
parties to avoid double payment of (A) the twenty million dollars
($20,000,000) of Company Senior Preferred Stock (measured on the basis of
Liquidation Preference) which is subject to redemption as provided in the
preceding sentence and (B) the final twenty million dollars ($20,000,000)
of the HEI Earn-Out, and no such double payment shall be required or
permitted."
Section 9. Article III Part A and Article III Part A Section 1 of the
Amended and Restated Articles of Incorporation of ChipPAC, Inc. annexed as
Exhibit C to the Original Recapitalization Agreement are hereby amended and
restated in their entirety as follows:
"Part A. Authorized Shares. The total number of shares of capital
stock which the Corporation has authority to issue is 485,000 shares,
consisting of:
1. 105,000 shares of Class B Preferred Stock, par value $.01 per
share ("Senior Preferred Stock");"
Section 10. Except as expressly set forth herein, all terms and conditions
of the Original Recapitalization Agreement shall remain unchanged.
-4-
IN WITNESS WHEREOF, this Amendment No. 1 has been duly executed and
delivered by the duly authorized officer of each party hereto as of the date
first written above.
HYUNDAI ELECTRONICS INDUSTRIES CO., LTD.
By: /s/ Dr. C. S. Park
------------------------------------------
Name: Dr. C. S. Park
Title: Executive Vice President
HYUNDAI ELECTRONICS AMERICA
By: /s/ Dr. C. S. Park
------------------------------------------
Name: Dr. C. S. Park
Title: President & CEO
CHIPPAC, INC.
By: /s/ Dr. C. S. Park
------------------------------------------
Name: Dr. C. S. Park
Title: Chairman of the Board
CHIPPAC MERGER CORP.
By: /s/ David Dominik
------------------------------------------
Name: David Dominik
Title: Chief Executive Officer
-4-