Crucial 2012 Annual Report Download - page 265

20
INOTERA MEMORIES, INC.
NOTES TO FINANCIAL STATEMENTS
(Continued)
In addition, the long-term loan agreements require that (i) no material adverse change shall be made to the
supply agreement signed by the Company, Nanya Technology Corporation (NTC), and Micron Technology
Inc., and (ii) NTC and Micron Technology Inc. and their affiliates, taken as a whole, directly or indirectly,
shall remain the largest shareholders of the Company and retain control over the Company. No such changes
occurred as of December 31, 2011.
In the event that any of the above financial covenants is breached, the Company is required to cure the breach,
no later than the end of November in the relevant calendar year, for a breach in respect of any semi-annual
financial statements, and for a breach in respect of any annual financial statements, no later than the end of
June of the following calendar year, or to submit a formal letter to the managing bank at least two months
prior to the expiration of the Remedial Period, so that the managing bank can convene a meeting of the Banks
to discuss the aforesaid breach and to resolve before the expiration of the Remedial Period on whether a
waiver of the breach will be granted.
On October 21, 2010, the syndicate banks formally agreed further to waive the Company's obligation to
comply with its financial loan covenants under its first syndicate loan of US$400,000 thousand and
$27,000,000 in connection with their review of the financial statements for the six-month period ended June
30, 2010. Also, on June 14 and November 10, 2011, the syndicate banks formally agreed further to waive
the Company's obligation to comply with its financial loan covenants under its first syndicate loan of US
$400,000 thousand and $27,000,000 and second syndicate loan of $35,000,000 in connection with their
review of the financial statements for the year ended December 31, 2010 and for the six-month period ended
June 30, 2011, respectively.
(3) On April 24, 2009, the Company contracted with Taichung Bank, under which, Taichung Bank granted
mortgage loan and unsecured loan facility to the Company totaling $1,670,000. The mortgage loan is secured
by a land (accounted for as idle asset) that is intended for the construction of the third Fab. Each of these
loans, with a term of two years and which bears interest rate based on two-year time deposit floating rate,
is payable in lump sum on maturity date. On December 24, 2010, the Company renewed the loan agreement
with Taichung Bank, under which, Taichung Bank agreed to prolong the term of mortgage loan and unsecured
loan facility granted to the Company to a term of three years. These mortgage loan and unsecured loan
facility, which bear interest rate based on 90-day or 180-day commercial paper rate in the secondary market
appearing on Moneyline Telerate plus margin, are payable in lump sum on maturity date and do not include
any financial covenants.