SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D/A (Amendment No. 2) Under the Securities Exchange Act of 1934 PSi Technologies Holdings, Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Common Shares, par value 1 2/3 Philippine Pesos per share - -------------------------------------------------------------------------------- (Title of Class of Securities) 74438Q 10 9 - -------------------------------------------------------------------------------- (CUSIP Number) c/o Merrill Lynch Global Emerging Markets Partners, L.P. 4 World Financial Center North Tower New York, NY 10080 Telephone: (212) 449-1000 With a copy to: Frank J. Marinaro, Esq. Merrill Lynch & Co., Inc. 4 World Financial Center North Tower New York, NY 10080 Telephone: (212) 449-1000 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) July 3, 2003 ------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. Note: Schedules filed in paper format shall include a signed original and five copies of the Schedule, including all exhibits. See Section 240.13d-7(b) for other parties to whom copies are to be sent. The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Note). 2 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Global Emerging Markets Partners, L.P. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6% * - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- 3 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Global Capital, L.L.L. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6%* - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON 00 - -------------------------------------------------------------------------------- 4 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Global Partners, Inc. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6%* - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 5 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON ML IBK Positions, Inc. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6%* - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- 6 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Group, Inc. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6%* - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON HC, CO - -------------------------------------------------------------------------------- 7 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch & Co., Inc. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 9,862,712* -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 9,862,712* - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 9,862,712* - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 61.6%* - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON HC, CO - -------------------------------------------------------------------------------- 8 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Global Emerging Markets Partners, LLC - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 2,721,088*. See Item 5. -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,721,088*. See Item 5. - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,721,088*. See Item 5. - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 17.0%*. See Item 5. - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 9 SCHEDULE 13D/A - -------------------------------------- CUSIP No. 74438Q 10 9 - -------------------------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Merrill Lynch Global Emerging Markets Partners II, LLC - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] Not Applicable - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS 00 - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] Not Applicable - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7 NUMBER OF SOLE VOTING POWER SHARES BENEFICIALLY Not Applicable OWNED BY -------------------------------------------------- EACH REPORTING 8 SHARED VOTING POWER PERSON WITH 2,721,088*. See Item 5. -------------------------------------------------- 9 SOLE DISPOSITIVE POWER Not Applicable - -------------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,721,088*. See Item 5. - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,721,088*. See Item 5. - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] Not Applicable - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 17.0%*. See Item 5. - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- 10 * Includes 2,721,088 shares of common stock of the Issuer issuable pursuant to the Exchange Agreement, attached hereto as Exhibit 2, representing 17.0% of the currently outstanding common stock of the Issuer and assuming the issuance of such 2,721,088 shares of common stock. 11 This Amendment No. 2 to Schedule 13D (this "Second Amendment") amends and supplements the Schedule 13D (the "Schedule 13D") and the Amendment No.1 to Schedule 13D (the "First Amendment") filed by the parties with the Securities and Exchange Commission on May 29, 2001 and June 13, 2003 respectively by adding Merrill Lynch Global Emerging Markets Partners, LLC ("MLGEMP LLC") and Merrill Lynch Global Emerging Markets Partners II, LLC ("MLGEMP II LLC") as parties. Further, except as specifically amended below, all other provisions of the Schedule 13D and the First Amendment remain in effect. Item 2. Identity and Background. The following paragraphs amend and supplement Item 2: This Second Amendment is being filed jointly by the parties who filed the Schedule 13D and the First Amendment, MLGEMP LLC and MLGEMP II LLC. MLGEMP LLC and MLGEMP II LLC are limited liability companies organized under the laws of Delaware. Appendix A is amended to include the following information with respect to MLGEMP LLC and MLGEMP II LLC: (a) name; (b) principal business; and (c) address of principal business and office. Appendix B is amended to include the following information with respect to the executive officers and directors of MLGEMP LLC and MLGEMP II LLC: (a) name; (b) business address (or residence where indicated); (c) present principal occupation or employment and the name, principal business and address of any corporation or other organization in which such employment is conducted; and (d) citizenship. With the exception of the events listed hereafter, during the last five years, no entity listed on Appendix A and, to the knowledge of the reporting persons, no person listed on Appendix B, has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and, as a result of such proceeding, was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. On February 20, 2003, Merrill Lynch agreed with the staff of the Securities and Exchange Commission (the "Commission") to a settlement in principle that would resolve the Commission's investigation regarding two transactions between Merrill Lynch and Enron in 1999. Without 12 admitting or denying any wrongdoing, Merrill Lynch would consent to an injunction enjoining Merrill Lynch from violations of the anti-fraud provisions of the federal securities laws. This settlement would conclude the Commission's investigation into Enron-related matters with respect to Merrill Lynch. Under the settlement Merrill Lynch would pay a total of $80 million in disgorgement, penalties and interest. Merrill Lynch would record this payment in its fourth quarter 2002 financial results, as it represented a subsequent event according to accounting principles. It was included in Merrill Lynch's 2002 10-K report, filed in March 2003. On March 17, 2003, Merrill Lynch announced that it had entered into a final settlement agreement with the Commission regarding the investigation disclosed above into two 1999 transactions with Enron. This agreement, in which the firm neither admits or denies any wrongdoing, finalized the reported settlement-in-principle of February 20, 2003 and concluded the Commission's investigation of all Enron-related matters with respect to Merrill Lynch. Item 4. Purpose of Transaction. The following paragraphs amend and supplement Item 4: On July 3, 2003, MLGEMP LLC, the Issuer and PSi Technologies entered into a Purchase Agreement (the "Purchase Agreement") pursuant to which MLGEMP LLC purchased from PSi Technologies a $4.0 million aggregate principal amount of 10.00% Exchangeable Senior Subordinated Note (the "Note") from PSi Technologies for a cash consideration of $4.0 million. The terms of the Note provide that PSi Technologies will pay interest on the unpaid principal amount of the Note at a rate per annum equal to 10.00%, payable semi-annually in arrears on each interest payment date as set forth in the Note. However, if on any such date PSi Technologies is prohibited from paying cash interest due to restrictions set forth in the Note, then PSi Technologies will pay all or any portion of such interest by adding it to the principal amount of the Note. Such amount will bear interest at the aforesaid rate and will no longer be considered to be interest due. On July 3, 2003, MLGEMP LLC, the Issuer and PSi Technologies entered into an Exchange Agreement (the "Exchange Agreement") pursuant to which the Issuer granted MLGEMP LLC an irrevocable right to exchange all or part of the Note for shares of common stock of the Issuer (the "Exchange Rights") at a per share price of $1.47 (the "Note Exercise Price"). The Note Exercise Price is subject to reduction if the Issuer fails to meet two performance targets. If (i) the Issuer fails to meet the first performance target, then the Note Exercise Price will be reduced to $1.29 and (ii) if the Issuer fails to meet the second target then the Note Exercise Price will be reduced to $1.15, if the Note Exercise Price was reduced pursuant to (i) above and the Note Exercise Price will be $1.29, if the Note Exercise Price was not reduced pursuant to (i) above. MLGEMP LLC may also, in its sole discretion, elect to replace all of its Exchange Rights with the right (the "Mandatory Issuance Rights") to assign a portion or all of the Note to the Issuer and subscribe for shares of common stock of the Issuer at 13 a price per share equal to the then par value of one share of common stock of the Issuer. If MLGEMP LLC exercises its Mandatory Issuance Rights, the number of shares of common stock of the Issuer to be issued to MLGEMP LLC shall be determined by dividing the aggregate principal amount of the Note then outstanding by the Note Exercise Price then in effect. The Note Exercise Price is also subject to anti-dilution adjustments as stated in the Exchange Agreement, which take effect if the Issuer issues or sells Common Stock or Common Stock Equivalents (as defined in the Exchange Agreement) without consideration or at a price per share less then their current market price while any Exchange Right or Mandatory Issuance Right is outstanding. The descriptions of the Purchase Agreement, the Exchange Agreement and the Note contained in this Second Amendment do not purport to be complete and are qualified by the complete text of the agreements filed as Exhibits to this Second Amendment. Item 5. Interest in Securities of the Issuer. The following paragraphs amend and supplement Item 5: On July 3, 2003, MLGEMP LLC purchased from PSi Technologies a $4.0 million aggregate principal amount 10.00% Exchangeable Senior Subordinated Note for a cash consideration of $4.0 million. Pursuant to the Exchange Agreement, MLGEMP LLC has Exchange Rights or Mandatory Issuance Rights, at its option, to exchange the Note for or to subscribe to 2,721,088 shares of common stock of the Issuer at the Note Exercise Price of $1.47 per share; provided however, that if the Issuer pays any of the accrued interest by adding it to the principal amount of the Note, such number of shares shall be increased accordingly. If the Issuer fails to meet certain performance targets for the three-month period ending September 30, 2003, then the Note Exercise Price will be reduced to $1.29 and MLGEMP LLC can exchange the Note for or subscribe to 3,100,775 shares of common stock of the Issuer; provided however, that if the Issuer pays any of the accrued interest by adding it to the principal amount of the Note, such number of shares shall be increased accordingly. If the Note Exercise Prices is reduced as above and if the Issuer fails to meet certain performance targets for the three-month period ending December 31, 2003, then the Note Exercise Price will be reduced to $1.15 and MLGEMP LLC can exchange the Note or subscribe to 3,478,260 shares of common stock of the Issuer; provided however, that if the Issuer pays any of the accrued interest by adding it to the principal amount of the Note, such number of shares shall be increased accordingly. If the Issuer meets the performance target for the three-month ending September 30, 2003 but fails to meet the performance target for December 31, 2003, then the Note Exercise Price will be reduced to $1.29 and MLGEMP LLC can exchange the Note for or subscribe to 3,100,775 shares of common stock of the Issuer; provided however, that if the Issuer pays any of the accrued interest by adding it to the principal amount of the Note, such number of shares shall be increased accordingly. The Note Exercise Price is also subject to anti-dilution adjustments as stated in the Exchange Agreement, which take effect if the Issuer issues or sells Common Stock or Common Stock Equivalents (as defined in the Exchange Agreement) without consideration or at a price per share less then their current market price while any Exchange Right or Mandatory Issuance Right is outstanding. 14 Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer. The following paragraphs amend and supplement Item 6: On July 3, 2003, MLGEMP LLC, the Issuer and PSi Technologies entered into the Purchase Agreement pursuant to which MLGEMP LLC purchased a $4.0 million aggregate principal amount 10.00% Exchangeable Senior Subordinated Note from PSi Technologies for a cash consideration of $4.0 million. The terms of the Note provide that PSi Technologies will pay interest on the unpaid principal amount of the Note at a rate per annum equal to 10.00%, payable semi-annually in arrears on each interest payment date as set forth in the Note. However, if on any such date PSi Technologies is prohibited from paying cash interest due to restrictions set forth in the Note, then PSi Technologies will pay all or any portion of such interest by adding it to the principal amount of the Note. Such amount will bear interest at the aforesaid rate and will no longer be considered to be interest due. On July 3, 2003, MLGEMP LLC, the Issuer and PSi Technologies entered into the Exchange Agreement pursuant to which the Issuer granted MLGEMP LLC the Exchange Rights at the Note Exercise Price of $1.47 per share. The Note Exercise Price is subject to reduction if the Issuer fails to meet two performance targets. If (i) the Issuer fails to meet the first performance target, then the Note Exercise Price will be reduced to $1.29 and (ii) if the Issuer fails to meet the second target then the Note Exercise Price will be reduced to $1.15, if the Note Exercise Price was reduced pursuant to (i) above and the Note Exercise Price will be $1.29, if the Note Exercise Price was not reduced pursuant to (i) above. MLGEMP LLC may also, in its sole discretion, elect to replace all of its Exchange Rights with the Mandatory Issuance Rights. If MLGEMP LLC exercises its Mandatory Issuance Rights, the number of shares of common stock of the Issuer to be issued to MLGEMP LLC shall be determined by dividing the aggregate principal amount of the Note then outstanding by the Note Exercise Price then in effect. The Note Exercise Price is also subject to anti-dilution adjustments as stated in the Exchange Agreement, which take effect if the Issuer issues or sells Common Stock or Common Stock Equivalents (as defined in the Exchange Agreement) without consideration or at a price per share less then their current market price while any Exchange Right or Mandatory Issuance Right is outstanding. The descriptions of the Purchase Agreement, the Exchange Agreement and the Note contained in this Second Amendment do not purport to be complete and are qualified by the complete text of the agreements filed as Exhibits to this Second Amendment. Item 7. Materials to be filed as Exhibits. 1. Purchase Agreement dated as of July 3, 2003, by and between Merrill Lynch Global Emerging Markets Partners, LLC, PSi Technologies Holdings, Inc. and PSi Technologies, Inc. 15 2. Exchange Agreement dated as July 3, 2003, by and between Merrill Lynch Global Emerging Markets Partners, LLC, PSi Technologies Holdings, Inc. and PSi Technologies, Inc. 3. $4,000,000 10.00% Exchangeable Senior Subordinated Note dated as of July 3, 2003. SIGNATURE After reasonable inquiry and to the best of our knowledge and belief, we certify that the information set forth in this Amendment is true, complete and correct. Date: July ___, 2003
MERRILL LYNCH GLOBAL EMERGING MERRILL LYNCH & CO., INC. MARKETS PARTNERS, LLC By: /S/ Frank J. Marinaro --------------------- Name: Frank J. Marinaro By: Merrill Lynch Global Emerging Partners, L.P., Title: Authorized Person* as its Managing Member MERRILL LYNCH GROUP, INC. By: Merrill Lynch Global L.L.C., as its General Partner By: /S/ Frank J. Marinaro --------------------- Name: Frank J. Marinaro By: Merrill Lynch Global Partners, Inc., as its Title: Authorized Person* Managing Member ML IBK POSITIONS, INC. By: /S/ Frank J. Marinaro --------------------- Name: Frank J. Marinaro By: /S/ Frank J. Marinaro Title: Vice President and Secretary --------------------- Name: Frank J. Marinaro Title: Vice President and Secretary MERRILL LYNCH GLOBAL EMERGING MARKETS PARTNERS II, LLC MERRILL LYNCH GLOBAL PARTNERS, INC. By: /S/ Frank J. Marinaro --------------------- By: Merrill Lynch Global Emerging Partners, L.P., Name: Frank J. Marinaro as its Managing Member Title: Vice President and Secretary By: Merrill Lynch Global L.L.C., as its General Partner By: Merrill Lynch Global Partners, Inc., as its Managing Member By: /S/ Frank J. Marinaro --------------------- Name: Frank J. Marinaro Title: Vice President and Secretary
16 MERRILL LYNCH GLOBAL EMERGING MARKETS PARTNERS, L.P. By: Merrill Lynch Global Capital, L.L.C. Its General Partner By: Merrill Lynch Global Partners, Inc. Its Managing Member By: /S/ Frank J. Marinaro Name: Frank J. Marinaro Title: Vice President and Secretary MERRILL LYNCH GLOBAL CAPITAL, L.L.C. By: Merrill Lynch Global Partners, Inc. Its Managing Member By: /S/ Frank J. Marinaro --------------------- Name: Frank J. Marinaro Title: Vice President and Secretary * The Powers of Attorney filed with the Commission on February 9, 2001 in connection with the reporting persons' Schedule 13G regarding the Issuer are hereby incorporated by reference 17 APPENDIX A CORPORATIONS, LIMITED PARTNERSHIP AND LIMITED LIABILITY COMPANY The names and principal businesses of the reporting persons are set forth below. Unless otherwise noted, the reporting persons have as the address of their principal business and office 4 World Financial Center, North Tower, New York, NY 10080. NAME PRINCIPAL BUSINESS Merrill Lynch Global Emerging Markets Investment partnership. Partners, L.P. Merrill Lynch Global Capital, L.L.C. Acts as general partner for an investment partnership. Merrill Lynch Global Partners, Inc. Acts as a manager of the affairs of the general partner in investment partnerships. ML IBK Positions, Inc. Holds proprietary investments for Merrill Lynch & Co., Inc. Merrill Lynch Group, Inc. Holding company. Merrill Lynch & Co., Inc. A holding company that, through its subsidiaries and affiliates, provides investment, financing, insurance and related services on a global basis. Merrill Lynch Global Emerging Markets Investment entity Partners, LLC Merrill Lynch Global Emerging Markets Investment entity Partners II, LLC 18 APPENDIX B EXECUTIVE OFFICERS AND DIRECTORS The names and principal occupations of each of the executive officers and directors of Merrill Lynch Global Partners, Inc., ML IBK Positions, Inc., Merrill Lynch Group, Inc. and Merrill Lynch & Co., Inc. are set forth below. Unless otherwise noted, all of these persons are United States citizens, and have as their business address 4 World Financial Center, New York, NY 10080. Merrill Lynch Global Emerging Markets Partners, LLC Merrill Lynch Global Emerging Markets Partners, L.P. is the managing member of Merrill Lynch Global Emerging Markets Partners, LLC. See Appendix A and the information set forth below with respect to Merrill Lynch Global Emerging Markets Partners, L.P. Merrill Lynch Global Emerging Markets Partners II, LLC Merrill Lynch Global Emerging Markets Partners, L.P. is the managing member of Merrill Lynch Global Emerging Markets Partners II, LLC. See Appendix A and the information set forth below with respect to Merrill Lynch Global Emerging Markets Partners, L.P. MERRILL LYNCH GLOBAL EMERGING MARKETS PARTNERS, L.P. Merrill Lynch Global Capital, L.L.C. is the general partner of Merrill Lynch Global Emerging Markets Partners, L.P. See Appendix A and the information set forth below with respect to Merrill Lynch Global Capital, L.L.C. MERRILL LYNCH GLOBAL CAPITAL, L.L.C. Merrill Lynch Global Partners, Inc. is the managing member of Merrill Lynch Global Capital, L.L.C. See Appendix A and the information set forth below with respect to Merrill Lynch Global Partners, Inc. MERRILL LYNCH GLOBAL PARTNERS, INC. PRESENT PRINCIPAL OCCUPATION Nathan C. Thorne Managing Director, Private Equity Director, President George A. Bitar Managing Director, Private Equity Director, Vice President Citizenship: Lebanon Jerome P. Kenney Managing Director, Investment Banking Director 19 Guido Padovano Managing Director, Private Equity Director, Vice President Citizenship: Italy Mandakini Puri Managing Director, Private Equity Director, Vice President Brian A. Renaud Managing Director, Private Equity Director, Vice President ML IBK POSITIONS, INC. PRESENT PRINCIPAL OCCUPATION Gary M. Carlin First Vice President, Investment President Banking Finance Nathan C. Thorne Managing Director, Private Equity Director, Vice President George A. Bitar Managing Director, Private Equity Director, Vice President Citizenship: Lebanon Mandakini Puri Managing Director, Private Equity Director, Vice President MERRILL LYNCH GROUP, INC. PRESENT PRINCIPAL OCCUPATION John Fosina First Vice President, Corporate Director, Vice President Controller D. Kevin Dolan Senior Vice President, Corporate Tax Director, Vice President John C. Stomber Senior Vice President, Treasurer Director, President & Treasurer Katherine Hudson Zrike First Vice President, Global Private Director, Vice President Client Counsel MERRILL LYNCH & CO., INC. PRESENT PRINCIPAL OCCUPATION Rosemary T. Berkery Executive Vice President, General Executive Officer Counsel 20 W. H. Clark Corporate Director Director c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Jill K. Conway Visiting Scholar, Massachusetts Director Institute of Technology c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Alberto Cribiore Managing Partner, Brera Capital Director Partners c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Robert C. Doll Senior Vice President, President and Executive Officer Chief Investment Officer, Merrill Lynch Investment Managers Ahmass L. Fakahany Executive Vice President, Chief Executive Officer Financial Officer James P. Gorman Executive Vice President; President of Executive Officer Global Private Client George B. Harvey Corporate Director Director c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Robert P. Luciano Corporate Director Director c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Heinz-Joachim Neuburger Executive Vice President and Chief Director Financial Officer of Siemens AG; Citizenship: Germany Member of the Executive Committee of the Managing Board of Siemens AG c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 21 David K. Newbigging Chairman of the Board of Friends' Director Provident plc Citizenship: United Kingdom c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 E. Stanley O'Neal Chairman of the Board, President and Director and Executive Officer Chief Executive Officer Thomas H. Patrick Executive Vice Chairman, Finance and Executive Officer Administration Aulana L. Peters Corporate Director Director c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 John P. Phelan Corporate Director Director c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Joseph W. Prueher Corporate Director, Consulting Director Professor to the Stanford-Harvard Preventive Defense Project c/o Corporate Secretary's Office 222 Broadway, 17th Floor New York, NY 10038 Arshad R. Zakaria Executive Vice President, President of Executive Officer Global Markets and Investment Banking 22 INDEX TO EXHIBITS Exhibit No. Description - ----------- ----------- 1. Purchase Agreement dated as of July 3, 2003, by and between Merrill Lynch Global Emerging Markets Partners, LLC, PSi Technologies Holdings, Inc. and PSi Technologies, Inc. 2. Exchange Agreement dated as July 3, 2003, by and between Merrill Lynch Global Emerging Markets Partners, LLC, PSi Technologies Holdings, Inc. and PSi Technologies, Inc. 3. $4,000,000 10.00% Exchangeable Senior Subordinated Note dated as of July 3, 2003. 23