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Exhibit
10.3
AMENDED AND RESTATED
GUARANTEE
August 10,
2007
Wachovia Capital Finance Corporation
(Canada), as Agent
141 Adelaide Street West, Suite
1500
Toronto, Ontario M5H 3L9
| Re: |
SMTC Manufacturing Corporation of Canada/Societe De
Fabrication SMTC Du Canada (the
“Borrower”) |
Ladies and Gentlemen:
WHEREAS Congress Financial
Corporation (Canada) (“ Congress ”) (predecessor
to Wachovia Capital Finance Corporation (Canada) (“
Wachovia ”)) has entered into certain financing
arrangements with Borrower and affiliates of Borrower pursuant to
which Congress made loans and provided other financial
accommodations to Borrower and its affiliates set forth in the Loan
Agreement dated as of June 1, 2004 (as amended pursuant to a
first amending agreement dated March 31, 2005, a second
amending agreement dated August 17, 2005, a third amending
agreement dated June 12, 2006, an extension letter dated
August 1, 2006 and a fourth amending agreement dated
September 20, 2006, collectively, the “ Original Loan
Agreement ”) and other agreements, documents and
instruments referred to therein or at any time executed and/or
delivered in connection therewith or related thereto, including a
guarantee provided by the undersigned in favour of Congress dated
as of June 1, 2004 (the “ Original Guarantee
”) (all of the foregoing, including the Original Loan
Agreement, being collectively referred to herein as the “
Original Financing Agreements ”).
WHEREAS Borrower has
requested that Wachovia (in such capacity, together with any
successors and assigns if any, the “ Agent ”)
for and on behalf of itself and as agent for Monroe Capital
Management Advisors LLC, a Delaware limited liability company (in
such capacity together with any successors and assigns if any, the
“ Tranche B Agent ”) and the lenders from time
to time party to the Loan Agreement (as hereinafter defined)
(collectively, the “ Lenders ”) amend and
restate the Original Loan Agreement pursuant to an amended and
restated loan agreement dated as of the date hereof (as the same
now exists or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced, the “ Loan
Agreement ”) and Borrower, Agent, Tranche B Agent and
Lenders have also agreed to amend and restate the other Original
Financing Agreements, including the Original Guarantee (all of the
foregoing, including the Loan Agreement, as the same now exists or
may hereafter be amended, modified, supplemented, extended,
renewed, restated or replaced, collectively the “
Financing Agreements ”); and
WHEREAS due to the close
business and financial relationships between Borrower and each of
the undersigned (individually, a “ Guarantor ”
and collectively, the “ Guarantors ”), in
consideration of the benefits which will accrue to Guarantors and
as an inducement for and in consideration of Agent, Tranche B Agent
and Lenders making loans and advances and providing
GUARANTEE RE CDN
LOAN
other financial accommodations to
Borrower and its affiliates pursuant to the Loan Agreement and
other Financing Agreements, each Guarantor hereby jointly and
severally agrees to amend and restate the Original Guarantee and
provide this Amended and Restated Guarantee (the “
Guarantee ”) as follows:
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(a) |
Each Guarantor absolutely and unconditionally guarantees and
agrees to be liable for the full and indefeasible payment and
performance when due of the following (all of which are
collectively referred to herein as the “ Guaranteed
Obligations ”): |
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(i) |
all obligations, liabilities and indebtedness of any kind,
nature and description of Borrower to Agent, Tranche B Agent and
Lenders and/or their affiliates, including principal, interest,
charges, fees, costs and expenses, however evidenced, whether as
principal, surety, endorser, guarantor or otherwise, whether
arising under the Loan Agreement and other Financing Agreements or
otherwise, whether now existing or hereafter arising, whether
arising before, during or after the initial or any renewal term of
the Loan Agreement or after the commencement of any case with
respect to Borrower and/or its affiliates under the Bankruptcy
and Insolvency Act (Canada) (“ BIA ”),
Companies’ Creditors Arrangement Act (Canada) (“
CCAA ”) or any similar statute in any jurisdiction
(the “ Insolvency Legislation ”) (including,
without limitation, the payment of interest and other amounts,
which would accrue and become due but for the commencement of such
case, whether or not such amounts are allowed or allowable in whole
or in part in any such case and including loans, interest, fees,
charges and expenses related thereto and all other obligations of
Borrower or its affiliates or successors to Agent, Tranche B Agent
and Lenders arising after the commencement of such case), whether
direct or indirect, absolute or contingent, joint or several, due
or not due, primary or secondary, liquidated or unliquidated,
secured or unsecured, and however acquired by Agent, Tranche B
Agent and Lenders and/or their affiliates; and |
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(ii) |
all expenses
(including, without limitation, attorneys’ fees and legal
expenses) incurred by Agent, Tranche B Agent and Lenders in
connection with the preparation, execution, delivery, recording,
administration, collection, liquidation, enforcement and defence of
Borrower’s and its affiliates’ obligations, liabilities
and indebtedness as aforesaid to Agent, Tranche B Agent and
Lenders, the rights of Agent, Tranche B Agent and Lenders in any
collateral or under this Guarantee and all other Financing
Agreements or in any way involving claims by or against Agent,
Tranche B Agent and Lenders directly or indirectly arising out of
or related to the relationships between Borrower and its
affiliates, any Guarantor or any other Obligor (as hereinafter
defined) and Agent, Tranche B Agent and Lenders, whether such
expenses are incurred before, during or after the
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GUARANTEE RE CDN
LOAN
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initial or any renewal
term of the Loan Agreement or other Financing Agreements or after
the commencement of any case with respect to Borrower or any
Guarantor under the Insolvency Legislation.
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(b) |
This Guarantee is a guaranty of payment and not of collection.
Each Guarantor agrees that Agent for itself, Tranche B Agent and
Lenders need not attempt to collect any Guaranteed Obligations from
Borrower and/or its affiliates, any other Guarantor or any other
Obligor or to realize upon any collateral, but may require any
Guarantor to make immediate payment of all of the Guaranteed
Obligations to Agent for itself, Tranche B Agent and Lenders when
due, whether by maturity, acceleration or otherwise, or at any time
thereafter. Agent shall apply any amounts received in respect of
the Guaranteed Obligations to any of the Guaranteed Obligations, in
whole or in part (including attorneys’ fees and legal
expenses incurred by Agent, Tranche B Agent or Lenders with respect
thereto or otherwise chargeable to Borrower and/or its affiliates
or Guarantors) and in accordance with the Loan
Agreement. |
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(c) |
Payment by a Guarantor shall be made to Agent, Tranche B Agent
and Lenders at the office of Agent from time to time, on demand, as
Guaranteed Obligations become due. Each Guarantor shall make all
payments to Agent for itself, Tranche B Agent and Lenders on the
Guaranteed Obligations free and clear of, and without deduction or
withholding for or on account of, any set-off, counterclaim,
defence, duties, taxes, levies, imposts, fees, deductions,
withholding, restrictions or conditions of any kind. One or more
successive or concurrent actions may be brought hereon against any
Guarantor either in the same action in which Borrower and/or its
affiliates or any other Obligor is sued or in separate actions. In
the event any claim or action, or action on any judgment, based on
this Guarantee is brought against any Guarantor, each Guarantor
agrees not to deduct, set-off, or seek any counterclaim for or
recoup any amounts which are or may be owed by Agent to any
Guarantor. |
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(a) |
Notice of acceptance of this Guarantee, the making of loans and
advances and providing other financial accommodations to Borrower
and its affiliates and presentment, demand, protest, notice of
protest, notice of non-payment or default and all other notices to
which Borrower and/or its affiliates or any Guarantor is entitled
are hereby waived by each Guarantor. Each Guarantor also waives
notice of and hereby consents to: |
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(i) |
any amendment, modification, supplement, extension, renewal, or
restatement of the Loan Agreement and other Financing Agreements,
including, without limitation, extensions of time of payment of or
increase or decrease in the amount of any of the Guaranteed
Obligations, the interest rate, fees, other charges, or any
collateral, and the guarantee made herein shall apply to the Loan
Agreement and other Financing Agreements and the Guaranteed
Obligations as so amended, modified, supplemented, renewed,
restated or extended, increased or decreased; |
GUARANTEE RE CDN
LOAN
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(ii) |
the taking, exchange, surrender and releasing of collateral or
guarantees now or at any time held by or available to Agent for the
obligations of Borrower and/or its affiliates or any other party at
any time liable on or in respect of the Guaranteed Obligations or
who is the owner of any property which is security for the
Guaranteed Obligations (individually, an “ Obligor
” and collectively, the “ Obligors
”); |
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(iii) |
the exercise of, or refraining from the exercise of any rights
against Borrower and/or its affiliates, any Guarantor or any other
Obligor or any collateral; |
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(iv) |
the settlement, compromise or release of, or the waiver of any
default with respect to, any of the Guaranteed Obligations. Each
Guarantor agrees that the amount of the Guaranteed Obligations
shall not be diminished and the liability of each Guarantor
hereunder shall not be otherwise impaired or affected by any of the
foregoing; and |
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(v) |
any Financing by Agent or Lenders of Borrower under
Section 364 of the United Bankruptcy Code or consent to the
use of cash collateral by Agent under Section 363 of the
United States Bankruptcy Code. |
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(b) |
No invalidity, irregularity or unenforceability of all or any
part of the Guaranteed Obligations shall affect, impair or be a
defence to this Guarantee, nor shall any other circumstance which
might otherwise constitute a defence available to or legal or
equitable discharge of Borrower or its affiliates in respect of any
of the Guaranteed Obligations, or any Guarantor in respect of this
Guarantee, affect, impair or be a defence to this Guarantee.
Without limitation of the foregoing, the liability of each
Guarantor hereunder shall not be discharged or impaired in any
respect by reason of any failure by Agent to perfect or continue
perfection of any lien or security interest in any collateral or
any delay by Agent in perfecting any such lien or security
interest. As to interest, fees and expenses, whether arising before
or after the commencement of any case with respect to Borrower or
its affiliates under any Insolvency Legislation, each Guarantor
shall be liable therefor, even if Borrower’s or its
affiliates’ liability for such amounts does not, or ceases
to, exist by operation of law. Each Guarantor acknowledges that
Agent has not made any representations to any Guarantor with
respect to Borrower and its affiliates or any other Obligor or
otherwise in connection with the execution and delivery by each
Guarantor of this Guarantee and each Guarantor is not in any
respect relying upon Agent or any statements by Agent in connection
with this Guarantee. |
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(c) |
Each
Guarantor hereby irrevocably and unconditionally waives and
relinquishes all statutory, contractual, common law, equitable and
all other claims against Borrower and its affiliates, any
collateral for the Guaranteed Obligations or other
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GUARANTEE RE CDN
LOAN
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assets of Borrower and/or
its affiliates or any other Obligor, for subrogation,
reimbursement, exoneration, contribution, indemnification, set-off
or other recourse in respect to sums paid or payable to Agent, for
itself, and for the benefit of Tranche B Agent and Lenders by each
Guarantor hereunder and each Guarantor hereby further irrevocably
and unconditionally waives and relinquishes any and all other
benefits which a Guarantor might otherwise directly or indirectly
receive or be entitled to receive by reason of any amounts paid by
or collected or due from such Guarantor, Borrower and/or its
affiliates or any other Obligor upon the Guaranteed Obligations or
realized from their property.
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(d) |
Notwithstanding anything to the contrary contained herein, the
amount of the obligations payable by each Guarantor under this
Guarantee shall be the aggregate amount of the Guaranteed
Obligations unless a court of competent jurisdiction adjudicates
Guarantor’s obligations to be invalid, avoidable or
unenforceable for any reason (including, without limitation,
because of any applicable state or federal law relating to
fraudulent conveyances or transfers), in which case the amount of
the Guaranteed Obligations payable by each Guarantor hereunder
shall be limited to the maximum amount that could be guaranteed by
each Guarantor without rendering such Guarantor’s obligations
under this Guarantee invalid, avoidable or unenforceable under such
applicable law. |
| 3. |
Subordination . Payment of all amounts now or hereafter
owed to each Guarantor by Borrower and/or its affiliates or any
other Obligor is hereby subordinated in right of payment to the
indefeasible payment in full to Agent, for itself, Tranche B Agent
and Lenders of the Guaranteed Obligations and all such amounts and
any security and guarantees therefor are hereby assigned to Agent
as security for the Guaranteed Obligations. |
| 4. |
Acceleration . Notwithstanding anything to the contrary
contained herein or any of the terms of any of the other Financing
Agreements, the liability of each Guarantor for the entire
Guaranteed Obligations shall mature and become immediately due and
payable, even if the liability of Borrower and/or its affiliates or
any other Obligor therefor does not, upon the occurrence of any
act, condition or event which constitutes an Event of Default (as
such term is defined in the Loan Agreement). |
| 5. |
Account Stated . The books and records of Agent showing
the account between Agent and Borrower shall be admissible in
evidence in any action or proceeding against or involving a
Guarantor as prima facie proof of the items therein set forth, and
the monthly statements of Agent rendered to Borrower, to the extent
to which no written objection is made within thirty (30) days
from the date of sending thereof to Borrower, shall be deemed
conclusively correct and constitute an account stated between Agent
and Borrower and be binding on all Guarantors. |
| 6. |
Termination . This Guarantee is continuing, unlimited,
absolute and unconditional. All Guaranteed Obligations shall be
conclusively presumed to have been created in reliance on this
Guarantee. A Guarantor shall continue to be liable hereunder until
one of Agent’s officers actually receives a written
termination notice from such Guarantor sent to Agent
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GUARANTEE RE CDN
LOAN
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at its address set forth
above by certified mail (return receipt requested) and thereafter
as set forth below. Revocation or termination hereof by a Guarantor
shall not affect, in any manner, the rights of Agent or any
obligations or duties of such Guarantor under this Guarantee with
respect to:
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(a) |
Guaranteed Obligations which have been created, contracted,
assumed or incurred prior to the receipt by Agent of such written
notice of revocation or termination as provided herein, including,
without limitation: |
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(i) |
all amendments, extensions, renewals and modifications of such
Guaranteed Obligations (whether or not evidenced by new or
additional agreements, documents or instruments executed on or
after such notice of revocation or termination); |
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(ii) |
all interest, fees and similar charges accruing or due on and
after revocation or termination; and |
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(iii) |
all attorneys’ fees and legal expenses, costs and other
expenses paid or incurred on or after such notice of revocation or
termination in attempting to collect or enforce any of the
Guaranteed Obligations against Borrower and/or its affiliates, any
Guarantor or any other Obligor (whether or not suit be brought);
or |
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(b) |
Guaranteed Obligations which have been created, contracted,
assumed or incurred after the receipt by Agent of such written
notice of revocation or termination as provided herein pursuant to
any contract entered into by Agent prior to receipt of such notice.
The sole effect of such revocation o |
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