EXHIBIT 10.77
RESTRUCTURING, SETTLEMENT
AND MUTUAL RELEASE AGREEMENT
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This Restructuring, Settlement and Mutual Release Agreement (this "Agreement")
is entered into as of this 24th day of April, 1998, by and among Microelectronic
Packaging, Inc. ("MPI"), on behalf of itself and its predecessors, successors,
former or current subsidiaries, affiliates, officers, directors, shareholders,
agents, attorneys, representatives, insurers, employees and assigns
(collectively with MPI, the "MPI Releasees"), and Texas Instruments Singapore
(Pte) Ltd ("TI"), and its predecessors, successors, subsidiaries, affiliates,
officers, directors, stockholders, agents, attorneys, representatives, insurers,
employees and assigns (collectively with TI, the "TI Releasees").
W I T N E S S E T H:
WHEREAS, pursuant to a Loan and Security Agreement dated May 16, 1995 by and
among MPI, Microelectronic Packaging (S) Pte Ltd ("MPS") and TI (including the
Form of Promissory Note executed by MPS pursuant thereto, collectively, the
"Initial Loan Agreement"), TI made a lump sum advance in the amount of US$3.5
million to MPS, a subsidiary of MPI currently in liquidation, upon which certain
interest amounts were thereafter due and payable periodically under the Initial
Loan Agreement as amended by Addendum One to the Loan and Security Agreement,
which was last signed on July 15, 1996, and Addendum Two to the Loan and
Security Agreement dated April 2, 1997 (collectively with the Initial Loan
Agreement, the "Loan Agreement");
WHEREAS, MPI entered into a Form of Corporate Guarantee dated May 16, 1995
with TI (the "Guarantee"), pursuant to which MPI agreed to guaranty the
obligations of MPS under the Loan Agreement;
WHEREAS, MPI entered into a Loan and Security Agreement dated May 13, 1997
with TI (the "Loan and Security Agreement"), pursuant to which TI loaned MPI
funds with which MPI purchased the debt of MPS under the Loan Agreement;
WHEREAS, MPI has defaulted on its obligations under the Loan and Security
Agreement; and
WHEREAS, the parties wish to settle all obligations under the Loan Agreement,
the Guarantee and the Loan and Security Agreement, and terminate and release all
rights and obligations under such documents and all other related agreements,
and settle all other disputes that may exist between MPI and each of the other
MPI Releasees, and TI and each of the other TI Releasees.
NOW, THEREFORE, in consideration of the mutual promises contained herein and
for other good and sufficient consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties agree as follows:
1. Definitions.
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a. "Payment Date" shall mean the calendar date after MPI completes the full
performance of its obligations under subsection 2 of this Agreement that the
payment to TI called for is such subsection have been received.
b. "Release Date" shall be the calendar date that is ninety (90) days after
the Payment Date.
c. "Insolvency Action" shall mean the commencement of a voluntary or
involuntary case against MPI under the United States Bankruptcy Code or an
assignment for the benefit of creditors by MPI that is not dismissed within
sixty (60) days of its commencement.
d. "Non-TI Creditor" shall mean any creditor of MPI other than TI, to which
MPI owes a Non-TI Debt.
e. "Non-TI Creditor Debt" shall mean any liability, debt or monetary
obligation (including without limitation a contingent, unliquidated or disputed
liability) of MPI in excess of US$500,000 as of the Effective Date (as defined
below) for which MPI is not liable to TI, where for purposes of such
determination, any liability, debt or monetary obligation involving multiple
future payments (e.g., installment loan or license royalty payments) shall be
treated as a single lump sum liability, debt or monetary obligation based on the
estimated or actual aggregate amount of projected payments; provided, however,
that "Non-TI Creditor Debt" shall not include any liability, debt or monetary
obligation owed by MPI (1) to Schlumberger Technologies, Inc. and its affiliates
or Details, Inc., (2) in connection with any real property or equipment lease,
or (3) otherwise in the ordinary course of MPI's business.
f. "Non-TI Creditor Settlement" shall mean any past, present or future
agreement, contract or arrangement between MPI and any Non-TI Creditor which
addresses the modification, settlement, discharge, release, resolution, accord
or satisfaction of such Non-TI Creditor's Non-TI Creditor Debt(s).
g. "Effective Date" shall mean the date which first appears above.
h. Other defined terms shall have the meanings assigned to them herein.
2. Settlement. In order to settle the defaults, amounts owed, debts,
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liabilities and other obligations pursuant to, in connection with, or arising
out of the Loan Agreement, the Guarantee, the Loan and Security Agreement and
each of their respective related agreements, letters, documents and instruments
(collectively, the "Loan Documents"), MPI agrees that, within six (6) calendar
months of the Effective Date, it will pay to TI the amount of US$1,077,147, by
wire transfer in accordance with the wire transfer instructions provided by TI.
3. Release Procedure. If and only if no Insolvency Action has occurred, then
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effective the Release Date:
a. TI, on behalf of itself and the other TI Releasees, agrees as follows:
i. TI, on behalf of itself and each other TI Releasee, fully and
forever releases and discharges each of the MPI Releasees from and against any
and all claims, damages and causes of action they may have against each such
person or entity with respect to any matter under the provisions of, arising out
of or in connection with, the Loan Documents, including any breach of any
representation or warranty or noncompliance or nonfulfillment of any covenant or
agreement set forth in such documents; provided that such release and discharge
shall not extend to any claims, damages and causes of action any TI Releasee may
have against any MPI Releasee for fraud or willful misconduct with respect to
any of the Loan Documents or any of the transactions contemplated by this
Agreement.
ii. TI agrees that each of the Loan Documents, regardless of whether
they are in default, are fully and completely terminated and rendered devoid of
legal effect and unenforceable, such that even provisions of the Loan Documents
that, according to their terms, survive termination, are terminated and
nullified. Further, TI acknowledges and agrees that any loan, debt, liability or
other obligation created pursuant to or arising out of the Loan Documents, as
well as any writings, agreements, notes or certificates representing such loan,
debt, liability or obligations, are canceled and rendered devoid of force and
effect.
b. MPI, on behalf of itself and the other MPI Releasees, agrees as follows:
i. MPI, on behalf of itself and each other MPI Releasee, fully and
forever releases and discharges each of the TI Releasees from any claims,
damages, and causes of action it or they may have against any of them with
respect to any matter under the provisions of, arising out of or in connection
with the Loan Documents; provided that such release and discharge shall not
extend to any claims, damages and causes of action any MPI Releasee may have
against any TI Releasee for fraud or willful misconduct with respect to any of
the Loan Documents or any of the transactions contemplated by this Agreement.
ii. MPI acknowledges and agrees that each of the Loan Documents are
fully and completely terminated and rendered devoid of force and effect, such
that even provisions of the Loan Documents and each of their respective related
agreements, letters, documents and instruments that, according to their terms,
survive termination, are terminated and nullified.
4. Confidentiality. No party to this Agreement shall, except as may be
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mandated by statutory or regulatory requirements, as may be required by legal
process in the course of actual litigation or in the case of a subpoena, as may
be necessary for MPI to negotiate with its creditors, disclose to others the
fact or terms of this settlement, the amounts referred to in this Agreement or
the fact of the payment of said amounts, except that each such party may
disclose to each such party's attorneys, accountant or other advisors to whom
the disclosure is necessary to effectuate the purposes for which such party has
consulted with such professional advisors and except that MPI may file this
Agreement with any governmental or regulatory body, describe it and refer to it
in any filing it makes pursuant to federal and state securities laws or to its
Board of Directors or shareholders; provided, however, that (i) TI may discuss
the terms of this Agreement with any Non-TI Creditor that is party to a Non-TI
Creditor Settlement to the extent required to enforce its rights under Section
5, and (ii) MPI may issue a press release describing the general terms of this
Agreement in connection with any public filing it makes with any governmental or
regulatory body.
5. Arrangements With Other Creditors. MPI hereby agrees that, if a Non-TI
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Creditor is a party to a Non-TI Creditor Settlement that provides such Non-TI
Creditor with the benefit of rights that are, in the aggregate, materially more
favorable than the same rights contained in this Agreement, including without
limitation terms regarding the amount of repayment (as a percentage of the total
Non-TI Creditor Debt(s) in question), with respect to such Non-TI Creditor's
claims related solely to its Non-TI Creditor Debt(s), then MPI will work with TI
to amend this Agreement so that TI is, in the aggregate, in generally the same
position as such Non-TI Creditor. TI acknowledges that certain Non-TI Creditors
of MPI have claims against MPI other than Non-TI Creditor Debt(s), and agrees
that it has no rights under this Section 5 with respect to settlements of such
other claims, which settlements may include without limitation the granting of
warrants to a Non-TI Creditor who is also a shareholder of MPI to compensate
such Non-TI Creditor for dilution of its equity holdings as well as certain
agreements, guarantees and cash payments related to an interest held by the Non-
TI Creditor in pending litigation. TI acknowledges that certain Non-TI
Creditors of MPI have structured their settlements differently, including
without limitation accepting a warrant for MPI's shares instead of a percentage
payment for part of its Non-TI Creditor Debt, and agrees that it has no rights
under this Section 5 with respect to such arrangements. Further, TI
acknowledges that this Agreement and the Non-TI Creditor Settlements each have
been separately negotiated, such that Non-TI Creditor Settlements may contain
different terms, rights and procedures from this Agreement, and agrees that, to
the extent that such different terms, rights and procedures do not render such
Non-TI Creditor Settlement materially more favorable to such Non-TI Creditor
than this Agreement is to TI, such differences do not give rise to rights under
this Section 5.
6. Representations and Warranties.
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a. MPI. MPI represents and warrants that:
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i. It has all requisite corporate power and authority to execute
and deliver, and fulfill its obligations under this Agreement. This Agreement
(notwithstanding the lack of approval of MPS), upon execution and delivery by
MPI and assuming due and proper execution and delivery by the other parties,
will constitute a valid and binding obligation of MPI, enforceable in accordance
with its terms, except as such enforcement may be limited by bankruptcy,
insolvency, moratorium and other laws of general application affecting the
enforcement of creditors' rights.
ii. No consent, approval, order or authorization, or registration,
qualification, designation, declaration or filing with, any federal, state or
local governmental authority on the part of MPI is required in connection with
the execution, delivery and performance of this Agreement by MPI, other than
state securities law filings.
iii. No consent, approval, waiver or other action by any person under
any contract, agreement, indenture, lease, instrument or other document to which
MPI is a party or by which it is bound is necessary for the execution, delivery
and performance of this Agreement by MPI.
b. TI. TI represents and warrants that:
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i. It has all requisite corporate power and authority to execute
and deliver,
and fulfill its obligations under this Agreement. This Agreement
(notwithstanding the lack of approval of MPS), upon execution and delivery by
TI, and assuming due and proper execution and delivery by MPI, will constitute a
valid and binding obligation of TI, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency, moratorium
and other laws of general application affecting the enforcement of creditors'
rights.
ii. No consent, approval, order or authorization, or registration,
qualification, designation, declaration or filing with, any foreign, federal,
state or local governmental or other authority or third party on the part of TI
is required in connection with the execution, delivery and performance of this
Agreement.
iii. No consent, approval, waiver or other action by any person under
any contract, agreement, indenture, lease, instrument or other document or law,
ordinance, statute, rule or regulation to which TI is a party or by which it or
its property is bound is necessary for the execution, delivery and performance
of this Agreement.
7. Miscellaneous. MPI and TI hereby agree as follows:
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a. Severability. If any provision of this Agreement is found to be
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unenforceable, it shall not affect the enforceability of the remaining
provisions and the court shall enforce all remaining provisions to the extent
permitted by law. All parties agree that, notwithstanding the lack of execution
of this Agreement by MPS, this Agreement is valid, binding and enforceable on
all parties.
b. Prior Agreements. This Agreement shall supersede and render null and
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void any and all prior agreements between MPI and/or MPS, on one hand, and TI
and/or any TI Releasee, on the other hand, concerning the subject matter
contained herein.
c. Successors and Assigns. This Agreement shall bind and benefit each of TI
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and its successors and assigns and shall also bind and benefit each MPI and its
successors and assigns. This Agreement may not be assigned by MPI, by operation
of law (e.g., merger) or otherwise (e.g., sale of substantially all assets),
without the prior written consent of TI.
d. Governing Law. This Agreement shall be deemed to have been entered into
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in the State of California and shall be construed and interpreted in accordance
with the laws of California.
e. Jurisdiction. The parties to the Agreement hereby (i) irrevocably submit
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to the jurisdiction of the courts of the State of California and the Federal
courts of the United States sitting in the State of California for the purpose
of any action or proceeding arising out of or relating to this Agreement and any
other documents and instruments relating hereto, (ii) agree that all claims in
respect of any such action or proceeding may be heard and determined in such
courts, (iii) irrevocably waive (to the extent permitted by applicable law) any
objection which any of them now or hereafter may have to the laying of venue of
any such action or proceeding brought in any of the foregoing courts, and any
objection on the ground that any such action or proceeding in any such court has
been brought in an inconvenient forum and (iv) agree that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner permitted by law.
f. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
g. Titles and Subtitles. The titles and subtitles used in this Agreement
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are used for convenience only and are not to be considered in construing or
interpreting this Agreement.
h. Amendment. No amendment, modification or waiver of this Agreement or any
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part thereof shall be effective unless it is in writing and is signed by MPI and
TI. No delay on the part of any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof. Nor shall any waiver on
the part of any party of any such right, power or privilege, nor any single or
partial exercise of any such right, power or privilege, preclude any further
exercise thereof or the exercise of any other such right, power or privilege.
The rights and remedies herein provided are cumulative and are not exclusive of
any rights or remedies that any party may otherwise have at law or in equity.
The rights and remedies of any party based upon, arising out of or otherwise in
respect of any inaccuracy in or breach or nonfulfillment of or noncompliance
with any representation, warranty, covenant or agreement contained in this
Agreement shall in no way be limited by the fact that the act, omission,
occurrence or other state of facts upon which any claim of any such inaccuracy
or breach is based may also be the subject matter of any other representation,
warranty, covenant or agreement contained in this Agreement (or in any other
agreement between the parties) as to which there is no inaccuracy or breach.
i. Termination. This Agreement may be terminated upon the mutual written
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consent of MPI and TI. TI may terminate this Agreement upon three (3) business
days' written notice to MPI in the event (i) an Insolvency Action occurs or (ii)
MPI commits a material breach of this Agreement. Unless previously terminated
pursuant to Section 3 of this Agreement, the Loan Documents shall remain in full
force and effect upon any termination of this Agreement.
j. Survival of Representations, Warranties, Covenants and Agreements. The
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representations, warranties, covenants and agreements contained in this
Agreement shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.
k. Notices. All notices, demands or other communications to be given or
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delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when delivered personally to the
recipient, sent to the recipient by reputable overnight courier service (charges
prepaid), mailed to the recipient by certified or registered mail, return,
receipt requested and postage prepaid, or transmitted by facsimile (with request
for immediate confirmation of receipt in a manner customary for communications
of such type and with physical delivery of the communication being made by one
of the other means specified in this Section as promptly as practicable
thereafter). Such notices, demands and other communications shall be addressed
as follows:
If to TI:
c/o Texas Instruments Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to MPI:
Attn: President
Microelectronic Packaging, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
Two Embarcadero Place
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party
(provided that notice of a change of address shall be effective only upon
receipt thereof).
m. Strict Construction. This Agreement is the result of arms-length
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negotiations between the parties hereto and has been prepared jointly by the
parties. In applying and interpreting the provisions of this Agreement, there
shall be no presumption that the Agreement was prepared by any one party or that
the Agreement shall be construed in favor of or against any one party.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on and as of the day and year first above written.
MICROELECTRONIC PACKAGING, INC.
By: /s ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Chief Financial Officer
TEXAS INSTRUMENTS SINGAPORE (PTE) LTD
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇▇
Finance Director