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GUARANTY

Guarantee Agreement

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This Guarantee Agreement involves

FREESCALE SEMICONDUCTOR INC

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Title: GUARANTY
Governing Law: New York     Date: 3/8/2007
Industry: Semiconductors     Sector: Technology

GUARANTY, Parties: freescale semiconductor inc
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Exhibit 10.18

 


GUARANTY

dated as of

December 1, 2006

among

FREESCALE ACQUISITION HOLDINGS CORP.,

as Holdings

FREESCALE HOLDINGS (BERMUDA) I, LTD.

FREESCALE HOLDINGS (BERMUDA) II, LTD.

FREESCALE HOLDINGS (BERMUDA) III, LTD.,

as Parent

FREESCALE HOLDINGS (BERMUDA) IV, LTD.,

as Foreign Holdings

CERTAIN SUBSIDIARIES OF PARENT

IDENTIFIED HEREIN

and

CITIBANK, N.A.,

as Administrative Agent


TABLE OF CONTENTS

ARTICLE I

DEFINITIONS

 

 

 

 

 

 

SECTION 1.01.

  

Credit Agreement

  

1

SECTION 1.02.

  

Other Defined Terms

  

1

ARTICLE II

GUARANTY

 

 

 

 

 

 

SECTION 2.01.

  

Guaranty

  

2

SECTION 2.02.

  

Guaranty of Payment

  

2

SECTION 2.03.

  

No Limitations

  

2

SECTION 2.04.

  

Reinstatement

  

3

SECTION 2.05.

  

Agreement To Pay; Subrogation

  

3

SECTION 2.06.

  

Information

  

4

ARTICLE III

INDEMNITY, SUBROGATION AND SUBORDINATION

 

 

 

 

 

 

SECTION 3.01.

  

Indemnity and Subrogation

  

4

SECTION 3.02.

  

Contribution and Subrogation

  

4

SECTION 3.03.

  

Subordination

  

4

ARTICLE IV

MISCELLANEOUS

 

 

 

 

 

 

SECTION 4.01.

  

Notices

  

5

SECTION 4.02.

  

Waivers; Amendment

  

5

SECTION 4.03.

  

Administrative Agent's Fees and Expenses, Indemnification

  

5

SECTION 4.04.

  

Successors and Assigns

  

6

SECTION 4.05.

  

Survival of Agreement

  

6

SECTION 4.06.

  

Counterparts; Effectiveness; Several Agreement

  

6

SECTION 4.07.

  

Severability

  

7

SECTION 4.08.

  

Right of Set-Off

  

7

SECTION 4.09.

  

Governing Law; Jurisdiction; Consent to Service of Process

  

7

SECTION 4.10.

  

WAIVER OF JURY TRIAL

  

8

SECTION 4.11.

  

Headings

  

8

SECTION 4.12.

  

Security Interest Absolute

  

8

SECTION 4.13.

  

Termination or Release

  

9

SECTION 4.14.

  

Additional Restricted Subsidiaries

  

9


GUARANTY dated as of December 1, 2006, among FREESCALE ACQUISITION HOLDINGS CORP. (“ Holdings ”), FREESCALE HOLDINGS (BERMUDA) III, LTD. (“ Parent ”), FREESCALE HOLDINGS (BERMUDA) IV, LTD. (“ Foreign Holdings ”), FREESCALE HOLDINGS (BERMUDA) I, LTD. (“ FH I ”), FREESCALE HOLDINGS (BERMUDA) II, LTD. (“ FH II ”), the Subsidiaries of Parent from time to time party hereto and CITIBANK, N.A., as Administrative Agent.

Reference is made to the Credit Agreement dated as of December 1, 2006 (as amended, supplemented or otherwise modified from time to time, the “ Credit Agreement ”), among Freescale Acquisition Corporation (prior to the Merger, the “ Borrower ”), to be merged with and into Freescale Semiconductor, Inc. (after the Merger, the “ Borrower ”), Foreign Holdings, Holdings, Parent, Citibank, N.A., as Administrative Agent, Swing Line Lender and an L/C Issuer, and each lender from time to time party thereto (collectively, the “ Lenders ” and individually, a “ Lender ”). The Lenders have agreed to extend credit to the Borrower subject to the terms and conditions set forth in the Credit Agreement. The obligations of the Lenders to extend such credit are conditioned upon, among other things, the execution and delivery of this Agreement. FH I, FH II, Foreign Holdings, Parent and Holdings are affiliates of the Borrower, will derive substantial benefits from the extension of credit to the Borrower pursuant to the Credit Agreement and are willing to execute and deliver this Agreement in order to induce the Lenders to extend such credit. Accordingly, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.01. Credit Agreement . (a) Capitalized terms used in this Agreement and not otherwise defined herein have the meanings specified in the Credit Agreement.

(b) The rules of construction specified in. Article I of the Credit Agreement also apply to this Agreement.

SECTION 1.02. Other Defined Terms . As used in this Agreement, the following terms have the meanings specified below:

Administrative Agent ” means Citibank, N.A., in it capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

Agreement ” means this Guaranty.

Claiming Party ” has the meaning assigned to such term in Section 3.02.

Contributing Party ” has the meaning assigned to such term in Section 3.02.

Credit Agreement ” has the meaning assigned to such term in the preliminary statement of this Agreement.


Guarantor ” means FH I, FH II, Foreign Holdings, Parent, Holdings, each Restricted Subsidiary that is a Material Domestic Subsidiary and not an Excluded Subsidiary, each Material Foreign Subsidiary that is not a direct or indirect Subsidiary of Holdings and each party that becomes a party to this Agreement after the Closing Date.

Guaranty Parties ” means, collectively, the Borrower and each Guarantor.

Guaranty Supplement ” means an instrument in the form of Exhibit I hereto.

Holdings ” has the meaning assigned to such term in the preliminary statement of this Agreement.

Parent ” has the meaning assigned to such term in the preliminary statement of this Agreement.

ARTICLE II

GUARANTY

SECTION 2.01. Guaranty . Each Guarantor unconditionally guarantees, jointly with the other Guarantors and severally, as a primary obligor and not merely as a surety, the due and punctual payment and performance of the Obligations. Each of the Guarantors further agrees that the Obligations may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its guarantee notwithstanding any extension or renewal of any Obligation. Each of the Guarantors waives presentment to, demand of payment from and protest to the Borrower or any other Guaranty Party of any of the Obligations, and also waives notice of acceptance of its guarantee and notice of protest for nonpayment.

SECTION 2.02. Guaranty of Payment . Each of the Guarantors further agrees that its guarantee hereunder constitutes a guarantee of payment when due and not of collection, and waives any right to require that any resort be had by the Administrative Agent or any other Secured Party to any security held for the payment of the Obligations, or to any balance of any deposit account or credit on the books of the Administrative Agent or any other Secured Party in favor of the Borrower or any other Person.

SECTION 2.03. No Limitations . (a) Except for termination of a Guarantor’s obligations hereunder as expressly provided in Section 4.13, the obligations of each Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of the Obligations, or otherwise. Without limiting the generality of the foregoing, the obligations of each Guarantor hereunder shall not be discharged or impaired or otherwise affected by (i) the failure of the Administrative Agent or any other Secured Party to assert any claim or demand or to enforce any right or remedy under the provisions of any Loan Document or otherwise; (ii) any rescission, waiver, amendment or modification of, or any release from any of the terms or provisions of, any Loan Document or any other agreement, including with respect to any other Guarantor under this Agreement; (iii) the release of any security held by the Collateral

 

4


Agent or any other Secured Party for the Obligations; (iv) any default, failure or delay, willful or otherwise, in the performance of the Obligations; or (v) any other act or omission that may or might in any manner or to any extent vary the risk of any Guarantor or otherwise operate as a discharge of any Guarantor as a matter of law or equity (other than the indefeasible payment in full in cash of all the Obligations). Each Guarantor expressly authorizes the Secured Parties to take and hold security for the payment and performance of the Obligations, to exchange, waive or release any or all such security (with or without consideration), to enforce or apply such security and direct the order and manner of any sale thereof in their sole discretion or to release or substitute any one or more other guarantors or obligors upon or in respect of the Obligations, all without affecting the obligations of any Guarantor hereunder.

(b) To the fullest extent permitted by applicable law, each Guarantor waives any defense based on or arising out of any defense of the Borrower or any other Guaranty Party or the unenforceability of the Obligations, or any part thereof from any cause, or the cessation from any cause of the liability of the Borrower or any other Guaranty Party, other than the indefeasible payment in full in cash of all the Obligations. The Administrative Agent and the other Secured Parties may in accordance with the terms of the Collateral Documents, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Obligations, make any other accommodation with the Borrower or any other Guaranty Party or exercise any other right or remedy available to them against the Borrower or any other Guaranty Party, without affecting or impairing in any way the liability of any Guarantor hereunder except to the extent the Obligations have been fully and indefeasibly paid in full in cash. To the fullest extent permitted by applicable law, each Guarantor waives any defense arising out of any such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Guarantor against the Borrower or any other Guaranty Party, as the case may be, or any security.

SECTION 2.04. Reinstatement . Each of the Guarantors agrees that its guarantee hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Obligation, is rescinded or must otherwise be restored by the Administrative Agent or any other Secured Party upon the bankruptcy or reorganization of the Borrower, any other Guaranty Party or otherwise.

SECTION 2.05. Agreement To Pay; Subrogation . In furtherance of the foregoing and not in limitation of any other right that the Administrative Agent or any other Secured Party has at law or in equity against any Guarantor by virtue hereof, upon the failure of the Borrower or any other Guaranty Party to pay any Obligation when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will forthwith pay, or cause to be paid, to the Administrative Agent for distribution to the Secured Parties in cash the amount of such unpaid Obligation. Upon payment by any Guarantor of any sums to the Administrative Agent as provided above, all rights of such Guarantor against the Borrower or any other Guaranty Party arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subject to Article III.

 

5


SECTION 2.06. Information . Each Guarantor assumes all responsibility for being and keeping itself informed of the Borrower’s and each other Guaranty Party’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations, and the nature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and agrees that none of the Administrative Agent or the other Secured Parties will have any duty to advise such Guarantor of information known to it or any of them regarding such circumstances or risks.

ARTICLE III

INDEMNITY, SUBROGATION AND SUBORDINATION

SECTION 3.01. Indemnity And Subrogation . In addition to all such rights of indemnity and subrogation as the Guarantors may have under applicable law (but subject to Section 3.03), the Borrower agrees that in the event a payment of an obligation shall be made by any Guarantor under this Agreement, the Borrower shall indemnify such Guarantor for the full amount of such payment and such Guarantor shall be subrogated to the rights of the Person to whom such payment shall have been made to the extent of such payment.

SECTION 3.02. Contribution And Subrogation . Each Guarantor (a “ Contributing Party ”) agrees (subject to Section 3.03) that, in the event a payment shall be made by any other Guarantor hereunder in respect of any Obligation and such other Guarantor (the “ Claiming Party ”) shall not have been fully indemnified by the Borrower as provided in Section 3.01, the Contributing Party shall indemnify the Claiming Party in an amount equal to the amount of such payment, in each case multiplied by a fraction of which the numerator shall be the net worth of the Contributing Party on the date hereof and the denominator shall be the aggregate net worth of all the Contributing Parties together with the net worth of the Claiming Party on the date hereof (or, in the case of any Guarantor becoming a party hereto pursuant to Section 4.14, the date of the Guaranty S


 
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