Crucial 2011 Annual Report Download - page 64

Cash Repurchase at the Option of the Holder : Upon a change in control or a termination of trading, as defined in the indenture, we may be
required to repurchase for cash all or a portion of the 2013 Notes at a repurchase price equal to 100% of the principal plus any accrued and unpaid
interest to, but excluding, the repurchase date.
2027 Notes
In connection with the Exchange Transaction on November 3, 2010, we issued $175 million of 2027 Notes. The initial conversion rate is
91.7431 shares of common stock per $ 1,000 principal amount or approximately $10.90 per share, and is subject to adjustment upon the
occurrence of certain events specified in the indenture.
Upon the issuance of the 2027 Notes, we recorded $ 130 million of debt, $ 40 million of additional capital and $ 2 million of deferred debt
issuance costs (included in other noncurrent assets). The amount recorded as debt is based on the fair value of the debt component as a standalone
instrument, and was determined using an average interest rate for similar nonconvertible debt issued by entities with credit ratings comparable to
ours at the time of issuance (Level 2). The $ 45 million
difference between the debt recorded at inception and its principal amount will be accreted
to principal through interest expense to June 2017, the expected life of the 2027 Notes. The fair value of the 2027 Notes was based on the trading
price on the exchange date (Level 1).
Conversion Rights : Holders may convert their 2027 Notes under the following circumstances: (1) during any calendar quarter if the closing
price of our common stock for at least 20 trading days in the 30 consecutive trading days ending on the last trading day of the immediately
preceding calendar quarter is more than 130% of the conversion price (approximately $ 14.17 per share); (2) if the 2027 Notes have been called
for redemption; (3) if specified distributions or corporate events occur; (4) if the trading price of the 2027 Notes is less than 98% of the product of
the closing price of our common stock and the conversion rate of the 2027 Notes during the period specified in the indenture; (5) upon our election
to terminate the conversion right of the 2027 Notes; or (6) after March 1, 2027 .
Upon conversion, we will pay cash up to the aggregate principal amount and shares of common stock or cash, at our option, for any
remaining conversion obligation. As a result of the conversion provisions in the indenture, upon conversion of the 2027 Notes only the amounts
payable in excess of the principal amounts of the 2027 Notes are considered in diluted earnings per share under the treasury stock method.
Cash Redemption at Our Option : We may redeem for cash the 2027 Notes on or after June 1, 2014 at a price equal to the principal amount
plus accrued and unpaid interest.
Cash Repurchase at the Option of the Holder : We may be required by the holders of the 2027 Notes to repurchase for cash the 2027 Notes
on June 1, 2017. The repurchase price is equal to the principal amount, plus accrued and unpaid interest. Upon a change in control or a termination
of trading, as defined in the indenture, we may be required by the holders of the 2027 Notes to repurchase for cash all or a portion of their 2027
Notes at a repurchase price equal to the principal amount plus accrued and unpaid interest.
Termination of Conversion Rights : We may elect to terminate the conversion right of the 2027 Notes if the daily volume weighted average
price of our common stock is greater than or equal to 130% of the conversion price (approximately $ 14.17 per share) for at least 20 trading days
during any 30 consecutive trading day period. If we terminate the conversion right prior to June 1, 2014 and any 2027 Notes are converted in
connection with the termination, we will pay a make-whole premium equal to the accrued interest as of the conversion date plus the present value
of remaining interest that would have been paid through May 31, 2014
, discounted using a U.S. Treasury bond with an equivalent term. Subject to
the terms of the indenture, we may, at our election, deliver shares of common stock in lieu of cash with respect to this make-whole payment.
TECH Credit Facility
In the third quarter of 2011, we repaid the remaining $ 250 million outstanding principal balance of the TECH credit facility, plus accrued
interest, that was due in periodic payments through May 2012. In connection therewith, $ 60 million of cash that was previously restricted was
released to us. (See "TECH Semiconductor Singapore Pte. Ltd." note.)
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