ON Semiconductor amends credit facility, modifying financial covenants

By Sara Rosenberg

New York, April 22 - ON Semiconductor Corp. amended its senior credit facilities, changing certain financial covenants. The amendment, however, will not be put into effect until the Phoenix, Ariz. power-and-data management semiconductor company completes an offering of senior secured notes, a company press release said. Proceeds from the note sale will be used to repay a portion of outstanding debt under the bank loans.

According to the release, under the amended credit facility minimum interest expense coverage ratio and maximum leverage ratio requirements will not apply until periods beginning after Dec. 31, 2003. Currently, under the credit agreement, ratio requirements apply after Dec. 31, 2002.

Also, from Jan. 1, 2004 to June 30, 2006, the minimum required interest expense coverage ratio will decrease and the maximum permitted leverage ratio will increase from current ratios. Minimum EBITDA levels will apply until Dec. 31, 2003 and minimum cash levels will apply until certain minimum interest coverage ratio and maximum leverage ratio requirements are met.

And, lastly, sales of plant, property and equipment in connection with specified restructuring activities will be permitted.

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