CY » Topics » Financial Commitment Between Cypress and SunPower:

This excerpt taken from the CY 10-K filed Mar 1, 2007.

Financial Commitment Between Cypress and SunPower:

In conjunction with the acquisition, Cypress entered into a commitment letter with SunPower during the fourth quarter of fiscal 2006 under which Cypress agreed to lend to SunPower up to $130 million in cash in order to facilitate the financing of the acquisition or working capital requirements. The commitment letter is available to be drawn against for a period not to exceed six months from the closing date. Any borrowings by SunPower will be evidenced by a senior subordinated note (the “SunPower Note”). The SunPower Note is unsecured and will be subordinated to existing and future revolving credit loans, term loans, lines of credit or letters of credit of SunPower. The interest rate will be LIBOR on the issuance date plus 475 basis points, and the SunPower Note will mature on the first anniversary of the issuance date. A mandatory pre-payment of any amounts outstanding under the SunPower Note is due upon the closing of any bank credit, debt or equity financing completed by SunPower. As of December 31, 2006, no borrowings were outstanding. In February 2007, Cypress and SunPower mutually terminated the commitment letter. No borrowings were outstanding at the termination date.

In addition, in conjunction with the acquisition, Cypress has entered into an agreement with PowerLight in which Cypress has agreed not to solicit to sell, make any agreement to sell, or make any demand registration

 

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rights for any of its 52.0 million SunPower class B common shares upon the earlier of (1) June 30, 2007 and (2) 60 days after the date on which the Registration Statement on Form S-3 is filed with the Securities and Exchange Commission.

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