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
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SECTION 1.01.
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Credit
Agreement
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1
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SECTION
1.02.
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Other Defined
Terms
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1
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ARTICLE II
GUARANTY
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SECTION 2.01.
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Guaranty
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2
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SECTION
2.02.
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Guaranty of
Payment
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2
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SECTION
2.03.
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No
Limitations
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2
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SECTION
2.04.
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Reinstatement
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3
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SECTION
2.05.
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Agreement To
Pay; Subrogation
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3
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SECTION
2.06.
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Information
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4
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ARTICLE III
INDEMNITY, SUBROGATION AND
SUBORDINATION
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SECTION 3.01.
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Indemnity and
Subrogation
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4
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SECTION 3.02.
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Contribution
and Subrogation
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4
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SECTION 3.03.
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Subordination
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4
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ARTICLE IV
MISCELLANEOUS
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SECTION 4.01.
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Notices
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5
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SECTION 4.02.
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Waivers;
Amendment
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5
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SECTION 4.03.
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Administrative
Agent's Fees and Expenses, Indemnification
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5
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SECTION 4.04.
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Successors and
Assigns
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6
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SECTION 4.05.
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Survival of
Agreement
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6
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SECTION 4.06.
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Counterparts;
Effectiveness; Several Agreement
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6
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SECTION 4.07.
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Severability
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7
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SECTION 4.08.
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Right of
Set-Off
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7
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SECTION 4.09.
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Governing Law;
Jurisdiction; Consent to Service of Process
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7
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SECTION 4.10.
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WAIVER OF JURY
TRIAL
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8
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SECTION 4.11.
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Headings
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8
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SECTION 4.12.
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Security
Interest Absolute
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8
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SECTION 4.13.
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Termination or
Release
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9
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SECTION 4.14.
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Additional
Restricted Subsidiaries
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9
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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
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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.
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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