EXHIBIT 2.5
AMENDED AND RESTATED
FOUR YEAR REVOLVING TERM CREDIT AGREEMENT
CELESTICA INC. AND CELESTICA INTERNATIONAL INC.,
AS BORROWERS
- AND -
THE BANK OF NOVA SCOTIA,
AS ADMINISTRATIVE AGENT
- AND -
THE FINANCIAL INSTITUTIONS NAMED IN SCHEDULE A,
AS LENDERS
U.S. $500,000,000
FOUR YEAR REVOLVING TERM CREDIT FACILITY
MADE AS OF DECEMBER 17, 2002
OSLER, XXXXXX & XXXXXXXX XXX
X.X. XXX 00, 0 XXXXX XXXXXXXX XXXXX
XXXXXXX, XXXXXXX
TABLE OF CONTENTS
PAGE
ARTICLE 1
INTERPRETATION..........................................................................................2
1.1 Definitions....................................................................................2
1.2 Headings......................................................................................20
1.3 Use of Defined Terms..........................................................................20
1.4 Extended Meanings.............................................................................20
1.5 Cross References..............................................................................20
1.6 Reference to Agent or Lenders.................................................................20
1.7 Accounting Terms..............................................................................21
1.8 Consolidated Financial Statements and Consolidated Accounts...................................21
1.9 Non-Banking Days..............................................................................21
1.10 References to Time of Day.....................................................................21
1.11 Severability..................................................................................21
1.12 Currency......................................................................................22
1.13 References to Statutes........................................................................22
1.14 References to Agreements......................................................................22
1.15 Consents and Approvals........................................................................22
1.16 Schedules.....................................................................................22
ARTICLE 2
THE FACILITY...........................................................................................23
2.1 Establishment of the Facility.................................................................23
2.2 Purpose, Nature and Term of the Facility......................................................23
2.3 Availability of Advances......................................................................23
2.4 Lenders' Obligations..........................................................................24
2.5 Repayment of Facility.........................................................................24
2.6 Payments/Cancellation or Reduction............................................................25
2.7 Extension of Maturity Date....................................................................25
2.8 Interest on Base Rate Canada Advances.........................................................28
2.9 LIBOR Advances................................................................................28
2.10 Method and Place of Payment...................................................................30
2.11 Fees..........................................................................................30
2.12 Conversion Options............................................................................30
2.13 Execution of Notices..........................................................................31
2.14 Evidence of Indebtedness......................................................................31
2.15 Interest on Unpaid Costs and Expenses.........................................................31
2.16 Criminal Rate of Interest.....................................................................31
2.17 Compliance with the Interest Act (Canada).....................................................31
2.18 Nominal Rate of Interest......................................................................32
2.19 Swing Line Facility...........................................................................32
2.20 Increase In Aggregate Commitment Amount To U.S.$750,000,000...................................34
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TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 3
CHANGE OF CIRCUMSTANCES AND INDEMNIFICATION............................................................36
3.1 Lender Representation.........................................................................36
3.2 Increased Costs...............................................................................36
3.3 Illegality....................................................................................37
3.4 Mitigation....................................................................................37
3.5 Taxes.........................................................................................39
3.6 Tax Refund....................................................................................41
ARTICLE 4
CONDITIONS PRECEDENT TO DRAWDOWN.......................................................................42
4.1 Conditions for Closing........................................................................42
4.2 Conditions for First Drawdown.................................................................43
4.3 Conditions for Subsequent Drawdowns...........................................................43
ARTICLE 5
PROVISIONS RELATING TO SUBSIDIARIES....................................................................44
5.1 Material Restricted Subsidiaries to Provide Guarantees........................................44
5.2 Unrestricted Subsidiaries.....................................................................44
ARTICLE 6
REPRESENTATIONS AND WARRANTIES.........................................................................46
6.1 Representations and Warranties................................................................46
6.2 Survival of Representations and Warranties....................................................50
6.3 Deemed Repetition of Representations and Warranties...........................................50
ARTICLE 7
COVENANTS..............................................................................................51
7.1 Affirmative Covenants.........................................................................51
7.2 Negative Covenants............................................................................56
7.3 Financial Covenants...........................................................................58
ARTICLE 8
DEFAULT AND ACCELERATION...............................................................................60
8.1 Events of Default.............................................................................60
8.2 Acceleration..................................................................................63
8.3 Remedies Cumulative and Waivers...............................................................63
8.4 Suspension of Lenders' Obligations............................................................64
8.5 Application of Payments After an Event of Default.............................................64
ARTICLE 9
THE ADMINISTRATIVE AGENT AND ADMINISTRATION OF THE FACILITY............................................65
9.1 Authorization of Action.......................................................................65
9.2 Procedure for Making Advances.................................................................65
9.3 Remittance of Payments........................................................................66
9.4 Redistribution of Payment.....................................................................67
9.5 Duties and Obligations........................................................................68
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TABLE OF CONTENTS
(CONTINUED)
PAGE
9.6 Prompt Notice to the Lenders..................................................................69
9.7 Administrative Agent's Authority..............................................................69
9.8 Lender's Independent Credit Decision..........................................................69
9.9 Indemnification...............................................................................70
9.10 Successor Agent...............................................................................70
9.11 Taking and Enforcement of Remedies............................................................70
9.12 Reliance Upon Lenders.........................................................................72
9.13 Reliance upon Administrative Agent............................................................72
9.14 Replacement of Cancelled Commitments..........................................................72
9.15 Disclosure of Information.....................................................................73
9.16 Adjustments of Rateable Portions..............................................................74
ARTICLE 10
COSTS, EXPENSES AND INDEMNIFICATION....................................................................75
10.1 Costs and Expenses............................................................................75
10.2 Indemnification by the Borrowers..............................................................75
10.3 Funds.........................................................................................75
10.4 General Indemnity.............................................................................76
10.5 Environmental Claims..........................................................................77
ARTICLE 11
GENERAL................................................................................................79
11.1 Term..........................................................................................79
11.2 Survival......................................................................................79
11.3 Benefit of the Agreement......................................................................79
11.4 Notices.......................................................................................79
11.5 Amendment and Waiver..........................................................................80
11.6 Governing Law.................................................................................81
11.7 Further Assurances............................................................................81
11.8 Enforcement and Waiver by the Lenders.........................................................81
11.9 Execution in Counterparts.....................................................................81
11.10 Assignment by the Borrowers...................................................................81
11.11 Assignments and Transfers by a Lender.........................................................81
11.12 Certain Requirements in Respect of Merger, Etc................................................84
11.13 Location of Lenders...........................................................................86
11.14 Set-Off.......................................................................................86
11.15 Time of the Essence...........................................................................86
11.16 Advertisements................................................................................86
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TABLE OF CONTENTS
PAGE
Schedules:
Schedule A - Lenders
Schedule B - Lenders' Commitments
Schedule C - Applicable Margin and Facility Fee
Schedule D - Quarterly Certificate on Covenants
Schedule E - Conversion Notice
Schedule F - Drawdown Notice and Notice of Swing Line Borrowing
Schedule G - Guarantees
Schedule H - Rollover Notice
Schedule I - Transfer Notice
Schedule J - Mandatory Cost Calculation
Schedule K - Opinions of Counsel
Schedule L - Extension Request
Schedule M - Permitted Encumbrance Certificate
AMENDED AND RESTATED
FOUR YEAR REVOLVING TERM CREDIT AGREEMENT
MADE as of the 17th day of December, 2002.
B E T W E E N:
CELESTICA INC.,
a corporation incorporated under the laws of the Province of
Ontario,
OF THE FIRST PART,
- and -
CELESTICA INTERNATIONAL INC.,
a corporation incorporated under the laws of the Province of
Ontario,
OF THE SECOND PART,
- and -
THE BANK OF NOVA SCOTIA,
a Canadian chartered bank, as Administrative Agent
OF THE THIRD PART,
- and -
THE FINANCIAL INSTITUTIONS NAMED IN SCHEDULE
A, as Lenders,
OF THE FOURTH PART.
WHEREAS
Celestica Inc., Celestica International Inc., The Bank of Nova Scotia as
the Administrative Agent, and the financial institutions named therein as the
Lenders are parties to a
Four Year Revolving Term Credit Agreement dated as of
July 31, 2001 (the "EXISTING CREDIT AGREEMENT")
AND WHEREAS the parties hereto wish to amend and restate the Existing Credit
Agreement on the terms set forth herein;
NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the premises,
the covenants herein contained and other valuable consideration, the parties
hereto agree as follows:
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ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"ACQUIRED INDEBTEDNESS" means Indebtedness of any Person (i) which is
outstanding at the time that such Person becomes a Restricted Subsidiary or is
amalgamated with, or merged with or into, a Borrower or a Restricted Subsidiary;
or (ii) which is outstanding at the time that assets of a Person are acquired by
a Borrower or a Restricted Subsidiary and the obligation for repayment of which
is assumed by such Borrower or Restricted Subsidiary in connection with the
acquisition of such assets;
"ACQUIRING LENDERS" has the meaning specified in Section 2.7(b)(iii);
"ACQUISITION DATE" has the meaning specified in Section 2.7(b)(iii);
"ADDITIONAL COMPENSATION" has the meaning specified in Section 3.2;
"ADMINISTRATIVE AGENT" means Scotiabank when acting in its capacity as
administrative agent hereunder;
"ADVANCE" means a LIBOR Advance, a Base Rate Canada Advance made by the Lenders
or a Lender, as applicable and "ADVANCES" means all of them;
"AFFECTED LENDER" has the meaning specified in Section 3.4(b);
"AFFILIATE" means an affiliated body corporate and, for the purposes of this
Agreement, (i) one body corporate is affiliated with another body corporate if
one such body corporate is the Subsidiary of the other or both are Subsidiaries
of the same body corporate or each of them is controlled by the same Person and
(ii) if two bodies corporate are affiliated with the same body corporate at the
same time, they are deemed to be affiliated with each other; for greater
certainty for the purposes of this definition, "BODY CORPORATE" shall include a
Canadian Chartered Bank;
"AGREEMENT" means this agreement and all Schedules attached hereto as the same
may be amended, restated, replaced or superseded from time to time;
"ALTERNATE LENDERS" has the meaning specified in Section 2.7(b)(iv);
"APPLICABLE LAW" means, with respect to any Person, property, transaction or
event, all applicable laws, statutes, rules, regulations, codes, treaties,
conventions, judgements, orders, awards or determinations of courts, arbitrators
or mediators, and decrees in any applicable jurisdiction which are binding on
such Person, property, transaction or event;
"APPLICABLE MARGIN" shall have the meaning specified in Schedule C;
"APPROVED CREDIT RATING AGENCY" means any one of Standard & Poor's Ratings
Services (a division of The XxXxxx-Xxxx Companies, Inc.) ("STANDARD & POOR'S"),
Moody's Investors
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Service, Inc. ("MOODY'S") and any other similar agency agreed
to by Celestica and the Administrative Agent;
"APPROVING LENDERS" has the meaning specified in Section 2.7(b);
"ARM'S LENGTH" has the meaning ascribed thereto under the INCOME TAX ACT
(Canada) in effect as of the date hereof;
"ASSENTING LENDER" has the meaning specified in Section 3.4(b);
"AVAILABLE SWING LINE COMMITMENT" means the monetary amount which is the
Commitment of the Swing Line Lender as may be increased or decreased from time
to time pursuant to Section 2.19(j);
"BANKING DAY" means a day, other than a Saturday or a Sunday and, where used in
the context of a notice, delivery, payment or other communication addressed to
the Administrative Agent, which is also a day on which banks are not required or
authorized to close in Toronto, Canada;
"BASE RATE CANADA" means, on any day on which such rate is determined, the
greater of (i) the variable rate of interest per annum, expressed on the basis
of a year of 365 or 366 days, as the case may be, established or quoted from
time to time by the Administrative Agent as the reference rate of interest then
in effect for determining interest rates on United States Dollar denominated
commercial loans made by it in Canada; and (ii) the Federal Funds Effective Rate
plus 1/2 of 1% per annum;
"BASE RATE CANADA ADVANCE" means a loan made by the Lenders to a Borrower on
which interest is payable based on the Base Rate Canada plus the Applicable
Margin;
"BORROWERS' COUNSEL" means Xxxxxx Xxxx Philips & Xxxxxxxx XXX, Xxxxxxx, Xxxxxxx
or such other firm of legal counsel as the Borrowers may from time to time
designate;
"BORROWERS" means Celestica and Celestica International from time to time and
their respective permitted successors and assigns and "BORROWER" means any of
them;
"BUSINESS" means the business of:
(a) conducting a broad range of electronics manufacturing services,
including the manufacturing, assembly and testing of printed circuit
boards, printed circuit board assembly, backplanes,
electro-mechanical sub-assembly, memory modules, photonics,
opto-electronic assembly, full system assembly, product testing,
quality assurance, failure analysis, and other related manufacturing
services;
(b) a full range of supply chain management, services such as materials
procurement, inventory management, logistics, packaging,
distribution, after-market support and refurbishment;
(c) design services including concept and product design, product
documentation and data management, prototype services, product
qualification, design for manufacturability and new product
introduction;
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(d) the design, production, distribution and sale of power products; and
(e) any incidental businesses conducted by businesses acquired by a
Borrower or a Restricted Subsidiary whose principal business involves
one or more of the businesses described in paragraphs (a) through (d)
of this definition;
"CANADIAN DOLLARS" and "CDN. $" mean the lawful currency of Canada in
immediately available funds;
"CAPITAL LEASE" means any leasing or similar arrangement which, in accordance
with GAAP, would be classified a capital lease;
"CAPITAL LEASE OBLIGATIONS" means all monetary obligations of Celestica or a
Subsidiary under a Capital Lease and for the purposes of this Agreement and each
other Loan Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP;
"CELESTICA" means
Celestica Inc., a corporation duly incorporated, organized and
subsisting under the laws of the Province of
Ontario, and any successor or
continuing corporation;
"CELESTICA CORP." means Celestica Corporation, a corporation duly incorporated,
organized and subsisting under the laws of the State of Delaware, and any
successor corporation;
"CELESTICA INTERNATIONAL" means Celestica International Inc., a corporation duly
incorporated, organized and subsisting under the laws of the Province of
Ontario, and any successor or continuing corporation;
"CERCLA" means the United States COMPREHENSIVE ENVIRONMENTAL RESPONSE,
COMPENSATION AND LIABILITY ACT OF 1980;
"CERCLIS" means the United States Comprehensive Environmental Response
Compensation Liability Information System List;
"CLAIMS" has the meaning specified in Section 10.4(a);
"CLOSING" means the consummation of the transactions contemplated herein,
including, without limitation, the satisfaction of the conditions precedent set
out in Section 4.1 and the Facility becoming available to the Borrowers subject
to the terms of this Agreement;
"CLOSING DATE" means December 17, 2002;
"CODE" means the United States INTERNAL REVENUE CODE OF 1986;
"COMMITMENT" means the commitment of each Lender to loan a portion of the
aggregate amount of the Facility, in the amount set opposite its name in
Schedule B, as such Schedule B may be amended pursuant to (a) Section 2.20 or
(b) under a Transfer Notice pursuant to Section 11.11;
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"CONTINGENT LIABILITY" means any agreement, undertaking or arrangement by which
any Person guarantees, endorses or otherwise becomes or is contingently liable
for the Indebtedness for borrowed monies of any other Person;
"CONTROL" means, with respect to control of a body corporate by a Person, the
holding (other than by way of security only) by or for the benefit of that
Person, or Affiliates of that Person of securities of such body corporate or the
right to vote or direct the voting of securities of such body corporate to
which, in the aggregate, are attached more than 50% of the votes that may be
cast to elect directors of the body corporate, provided that the votes attached
to those securities are sufficient, if exercised, to elect a majority of the
directors of the body corporate;
"CONTROLLED GROUP" means all members of a controlled group of corporations and
all members of a controlled group of trades or business (whether or not
incorporated) under common control which, together with the Borrowers, are
treated as a single employer under Section 414(b) or Section 414(c) of the Code;
"CONVERSION" means the conversion of one type of Advance into another type of
Advance pursuant to Section 2.12;
"CONVERSION NOTICE" means a notice substantially in the form set out in
Schedule E;
"CORPORATE REORGANIZATION" has the meaning specified in Section 11.12;
"DEFAULT" means an event which, with the giving of notice or the passage of time
or the making of any determination or any combination thereof as provided for
herein, would constitute an Event of Default;
"DESIGNATED ACCOUNT" means an account of a Borrower of which the Administrative
Agent is notified by such Borrower from time to time for the purposes of
transactions under this Agreement;
"DISSENTING LENDERS" has the meaning specified in Section 2.7(b);
"DRAWDOWN" means a drawdown of an Advance;
"DRAWDOWN DATE" means, in relation to any Advance, the date, which shall be a
Banking Day, on which the Drawdown of such Advance is made by a Borrower
pursuant to a Drawdown Notice;
"DRAWDOWN NOTICE" means a notice substantially in the form set out in Exhibit 1
to Schedule F;
"EBITDA" means, for any particular period, the aggregate of:
(a) Net Income for such period;
(b) all amounts deducted in the calculation of Net Income in respect of
Taxes, whether paid or deferred (in accordance with GAAP);
(c) all amounts deducted in the calculation of Net Income in respect of
depreciation;
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(d) all amounts deducted in the calculation of Net Income in respect of
amortization;
(e) all amounts deducted in the calculation of Net Income in respect of
Interest Expense;
(f) all amounts deducted in the calculation of Net Income in connection
with the implicit financing costs of synthetic leases and Permitted
Securitization Transactions;
(g) all amounts deducted in the calculation of Net Income in determining
all non-recurring charges; and
(h) non-cash charges and purchase accounting deductions,
provided that, in the event of the acquisition by Celestica or a Restricted
Subsidiary of (i) a corporation which becomes a new Restricted Subsidiary or
(ii) any other entity or a group of assets or an operation, provided that such
operation comprises a going concern which becomes a division or part of the
business of Celestica or a Restricted Subsidiary (an "OPERATION"), EBITDA will,
subject to (x) and (y), include the EBITDA for the newly acquired Restricted
Subsidiary or operation for its immediately preceding four fiscal quarters
completed prior to such acquisition.
(x) If such newly acquired Restricted Subsidiary or operation was,
immediately prior to such acquisition, accounted for on a stand-alone
basis, EBITDA for such newly acquired Restricted Subsidiary or
operation shall only be included in the above calculation if EBITDA
for such newly acquired Restricted Subsidiary or operation, as the
case may be, can be determined by reference to historical financial
statements satisfactory to the Administrative Agent; and
(y) If such newly acquired Restricted Subsidiary or operation:
(A) was not, immediately prior to such acquisition, accounted for
on a stand-alone basis; or
(B) was immediately prior to such acquisition, accounted for on a
stand-alone basis but, in the determination of the
Administrative Agent acting reasonably, the business of such
newly acquired Restricted Subsidiary or operation will not be
conducted by Celestica or its Restricted Subsidiary, as the
case may be, in substantially the same form or the same manner
as conducted by the vendor immediately prior to such
acquisition,
then subject to the satisfaction of the Administrative Agent and the Majority
Lenders with the method of determination thereof acting reasonably, EBITDA for
such newly acquired Restricted Subsidiary or operation will be determined having
regard to historical financial results together with, and having regard to,
contractual arrangements and any other changes made or proposed to be made by
Celestica or its Restricted Subsidiary, as the case may be, to the business of
such newly acquired Restricted Subsidiary or operation;
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"ENVIRONMENTAL LAWS" means applicable federal, provincial, state, municipal or
other local law, statute, regulation or by-law, code, ordinance, decree,
directive, standard, policy, guideline, rule, order, treaty, convention,
judgment, award or determination for the protection of the environment or human
health or relating to the manufacture, processing, distribution, use, treatment,
storage, Release, transport or handling of Hazardous Materials;
"ERISA" means the United States EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974;
"EVENT OF DEFAULT" means any of the events described in Section 8.1;
"EXEMPTED JURISDICTION" has the meaning specified in Section 11.12;
"EXISTING CREDIT AGREEMENT" has the meaning specified in the first recital
hereto;
"EXTENSION REQUEST" means a request made in writing by Celestica to the
Administrative Agent substantially in the form set out in Schedule L;
"FACILITY" means the four year revolving term credit facility in an initial
aggregate principal amount of U.S.$500,000,000 to be made available to the
Borrowers as set forth in Article 2 as same may be increased and/or extended
subject to the terms set forth herein;
"FACILITY FEE" has the meaning specified in Section 2.11(a) and calculated in
accordance with Schedule C;
"FEDERAL FUNDS EFFECTIVE RATE" means, for any particular day, the variable rate
of interest per annum, calculated on the basis of a 360-day year as determined
by the Administrative Agent for the actual number of days elapsed, equal to:
(a) the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers as published for such day (or, if such day is
not a Banking Day, for the next preceding Banking Day) by the Federal
Reserve Bank of New York, or
(b) for any Banking Day on which such rate is not so published by the
Federal Reserve Bank of New York, the average of the quotations for
such day for such transactions received by the Administrative Agent
from three federal funds brokers of recognized standing selected by
the Administrative Agent in consultation with Celestica;
"FINAL MATURITY DATE" means the day which is one year from the Maturity Date;
"GAAP" means those Canadian generally accepted accounting principles as now or
(except as provided in item (a) (iii) of the definition of Gross Funded Debt)
hereafter adopted by the Canadian Institute of Chartered Accountants or any
successor thereto;
"GLOBAL RATEABLE PORTION" means, with respect to any Lender, at any time, the
ratio, expressed as a decimal fraction, of:
(a) such Lender's Commitment at such time to
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(b) the aggregate of the Commitments of all of the Lenders at such time;
"GROSS FUNDED DEBT" of Celestica, on a consolidated basis, means at any
particular time and without duplication, the aggregate of:
(a) the following amounts determined in accordance with GAAP:
(i) the outstanding monetary Obligations at such time;
(ii) the Capital Lease Obligations outstanding at such time;
(iii) any other Indebtedness for borrowed money (including, without
limitation and without duplication, all Indebtedness in
respect of bankers' acceptances and letters of credit)
outstanding at such time but excluding (A) Permitted
Subordinated Indebtedness, and (B) any Indebtedness which, in
accordance with GAAP adopted as at the date of incurring such
Indebtedness, qualified as equity, so long as the terms
governing such Indebtedness are not amended after the date of
incurring the Indebtedness in a manner that would have
resulted in such Indebtedness not qualifying as equity in
accordance with GAAP as adopted as at the date of incurring
such Indebtedness;
(iv) the aggregate net marked-to-market liability under all Hedging
Obligations;
(v) any Acquired Indebtedness outstanding at such time;
(vi) the outstanding amounts under any Permitted Securitization
Transactions; and
(vii) the aggregate amounts outstanding under synthetic leases to
which Celestica and its Restricted Subsidiaries are parties
being the aggregate original cost of the assets subject to all
such leases less all payments made on account of principal
under all such leases on or prior to the date on which such
amounts are determined;
plus
(b) Contingent Liabilities of Celestica or any Restricted Subsidiary in
existence at such time;
"GUARANTEES" means the guarantees of each of the Guarantors substantially in the
form set forth in Schedule G;
"GUARANTOR" means each Person which, on the date of this Agreement, is or, after
the date of this Agreement, becomes a Material Restricted Subsidiary and
"GUARANTORS" means two or more of them;
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"HAZARDOUS MATERIAL" means any contaminant, pollutant, waste of any nature,
hazardous or toxic substance or material or dangerous good as defined,
judicially interpreted or identified in any Environmental Law or any substance
that causes harm or degradation to the surrounding environment or injury to
human health and, without restricting the generality of the foregoing, includes
any pollutant, contaminant, waste, hazardous waste, deleterious substance or
dangerous good present in such quantity or state that it contravenes any
Environmental Laws or gives rise to any liability or obligation under any
Environmental Law;
"HEDGING OBLIGATIONS" means, with respect to any Person, all liabilities of such
Person under interest rate swap agreements, interest rate cap agreements,
interest rate collar agreements and all such other agreements or arrangements
designed to protect such Person against fluctuations in interest rates;
"INDEBTEDNESS" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all obligations
of such Person evidenced by bonds, debentures, notes or other similar
instruments;
(b) all obligations, contingent or otherwise, relative to the face amount
of all letters of credit, whether drawn or undrawn, and bankers'
acceptances issued for the account of such Person;
(c) all obligations of such Person as lessee under leases which have been
or should be, in accordance with GAAP, recorded as Capital Leases,
including liabilities in respect of Capital Leases incurred by such
Person in connection with sale/leaseback transactions;
(d) net liabilities of such Person under all Hedging Obligations or net
liabilities of such Person under currency, swap, forward or other
foreign exchange hedging agreements;
(e) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest
thereon), secured by a lien on the property owned or being purchased
by such Person (including indebtedness arising under conditional
sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in
recourse;
(f) all Contingent Liabilities of such Person; and
(g) any Acquired Indebtedness.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer;
"INDEMNIFIED PERSON" has the meaning specified in Section 3.5(b);
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"INDEMNIFYING PARTY" has the meaning specified in Section 10.4(c);
"INDEMNITEE" has the meaning specified in Section 10.4(a);
"INTEREST EXPENSE" means, for any period, the aggregate consolidated interest
expense of Celestica on a consolidated basis as determined in accordance with
GAAP including the portions of any payment made in respect of Capital Leases
allocable to interest expenses but excluding deferred financing costs and other
non-cash interest expense;
"INTEREST PAYMENT DATE" shall have the meaning set out in Section 2.8;
"INTEREST PERIOD" means relative to any LIBOR Advance, the period commencing on
(and including) the date on which such LIBOR Advance is made or continued as, or
converted into, a LIBOR Advance, and ending on (but excluding) the day which
numerically corresponds to such date one, two, three or six months thereafter
(or, if such month has no numerically corresponding date, on the last Banking
Day of such month) as the Borrower may select; provided, however, that:
(a) if such Interest Period would otherwise end on a day which is not a
Banking Day, such Interest Period shall end on the next following
Banking Day (unless, if such Interest Period applies to LIBOR
Advances, and such next following Banking Day is the first Banking
Day of a calendar month, in which case such Interest Period shall end
on the Banking Day next preceding such numerically corresponding
day);
(b) the Borrowers shall not be permitted to select, collectively or in
the aggregate, Interest Periods to be in effect at any one time which
have expiration dates occurring on more than ten different dates,
unless otherwise previously consented to in writing by the
Administrative Agent; and
(c) no Interest Period may end later than the Maturity Date;
"LENDERS" means, collectively, the financial institutions set out in Schedule A
and "LENDER" shall mean any such financial institution;
"LENDERS' COUNSEL" means the firm of Osler, Xxxxxx & Harcourt LLP, Toronto,
Ontario, or such other firm of legal counsel as the Administrative Agent may
from time to time designate;
"LIBO RATE" means, relative to any LIBOR Advance:
(a) the rate of interest per annum of the offered quotations for deposits
in United States Dollars for a period equal or comparable to the
Interest Period in an amount comparable to the Advance as such rate
is reported on the display designated as "page 3750" or "page 3740",
as applicable (or any replacement pages) by "Telerate - The Financial
Information Network" published by Telerate Systems, Inc. (or such
other company or service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying
British Bankers' Association Interest Settlement Rates for deposits
in United
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States Dollars) at or about 10:00 a.m. (London, England time) on the
applicable Rate Fixing Day; or
(b) if a rate cannot be determined under paragraph (a) above, the rate
determined by the Administrative Agent to be the arithmetic average
(rounded up if necessary, to the nearest 1/16 of 1%) of such rates as
reported on the LIBO page by Reuters Money Market Service (or its
successor) for a period equal to or comparable to the Interest Period
and in an amount comparable to the Advance at or about 10:00 a.m.
(London, England time) on the applicable Rate Fixing Day provided
that at least two such rates are reported on such page; or
(c) if a rate cannot be determined under either of paragraphs (a) and (b)
above, the rate determined by the Administrative Agent for a
particular Interest Period to be the arithmetic average of the rates
per annum at which deposits in United States Dollars in immediately
available funds are offered by prime London banks to the LIBOR
Offices in the London interbank market for a period equal to or
comparable to the Interest Period and an amount comparable to the
Advance at or about 10:00 a.m. (London, England time) on the
applicable Rate Fixing Day.
For the purposes of this definition, "RATE FIXING DAY" means in respect of each
Interest Period, the second Banking Day before the first day of such Interest
Period.
"LIBOR ADVANCE" means a loan made by the Lenders to a Borrower on which interest
is payable at the LIBO Rate plus the Applicable Margin;
"LIBOR OFFICE" means, relative to any Lender, the office of such Lender
designated as such in Schedule A, if applicable, or designated in the Transfer
Notice by which a financial institution becomes a Lender pursuant to Section
11.11, or such other office of a Lender (or any successor, assign or Affiliate
of such Lender) as designated from time to time by notice from such Lender to
Celestica and the Administrative Agent, whether or not outside Canada, which may
be making or maintaining the LIBOR Advances of such Lender;
"LIENS" means any security interest, mortgage, pledge, hypothec, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise) or
charge against or interest in property to secure payment of a debt or
performance of an obligation (including the interest of a vendor or lessor under
any conditional sale agreement, or of a lessor under any lease including a
Capital Lease or other title retention agreement);
"LOAN DOCUMENTS" means this Agreement, the Guarantees provided for herein and
all other agreements, documents or instruments to be executed and delivered to
the Administrative Agent, the Lenders or any of them by the Borrowers, the
Guarantors or any of them hereunder or thereunder or pursuant hereto or thereto;
"LOSSES" has the meaning specified in Section 10.4(a);
"MAIN FACILITY COMMITMENT" means, at any time, the amount, if any, by which the
Commitment of the Swing Line Lender exceeds the Available Swing Line Commitment
at that time;
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"MAIN FACILITY RATEABLE PORTION" means, with respect to any Lender, at any time,
subject to adjustment by the Administrative Agent in accordance with Section
9.16 of this Agreement and also subject to Section 2.3 of this Agreement, the
ratio, expressed as a decimal fraction, of:
(a) such Lender's Commitment at such time (or, if such Lender is
Scotiabank, or an affiliate thereof, the Main Facility Commitment) to
(b) the aggregate of the Commitments of all of the Lenders (other than
Scotiabank and its affiliates) at such time and the Main Facility
Commitment at such time;
"MAJORITY LENDERS" means the Lenders, the Commitments of which are in the
aggregate more than 51% of the aggregate amount of Commitments;
"MANDATORY COST" means, in relation to a LIBOR Advance, an amount determined in
accordance with Schedule J;
"MATERIAL ADVERSE CHANGE" means any change of circumstances or any event which
would reasonably be likely to have a Material Adverse Effect;
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the business,
assets, operations, prospects or condition, financial or otherwise, of Celestica
and of the Restricted Subsidiaries taken as a whole, or (b) the ability of any
Borrower to perform any of its Obligations, or (c) the rights of the
Administrative Agent and the Lenders against the Obligors on a consolidated
basis pursuant to the Loan Documents;
"MATERIAL RESTRICTED SUBSIDIARY" means any Restricted Subsidiary of Celestica
whose assets total greater than U.S. $150,000,000 on an unconsolidated basis on
the date referenced in the most recently delivered set of financial statements
delivered pursuant to Section 7.1(a)(ii); provided, however, that the
unconsolidated assets of all Restricted Subsidiaries which are not Material
Restricted Subsidiaries shall not exceed on the date referenced in such
financial statements, in the aggregate, ten per cent (10%) of the unconsolidated
assets of the Borrowers and the Restricted Subsidiaries on such date, and in the
event that the unconsolidated assets of all Restricted Subsidiaries which are
not Material Restricted Subsidiaries exceeds, on the date referenced in such
financial statements, in the aggregate, ten percent (10%) of the unconsolidated
assets of the Borrowers and Restricted Subsidiaries, Celestica shall set out in
a Schedule to the Officer's Certificate to be delivered in accordance with
Section 7.1(a)(iii) the Restricted Subsidiaries which it wishes to designate as
Material Restricted Subsidiaries such that unconsolidated assets of all of the
Restricted Subsidiaries which are not Material Restricted Subsidiaries shall not
exceed ten percent (10%) of the unconsolidated assets of the Borrowers and
Restricted Subsidiaries on such date;
"MATURITY DATE" means July 30, 2005 or, if the Maturity Date has been extended
pursuant to the provisions of Section 2.7, the Final Maturity Date;
"NET INCOME" means, for any particular period, net income of Celestica for such
period determined on a consolidated basis in accordance with GAAP;
"NOTICE OF AMOUNT" has the meaning specified in Section 3.2;
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"NOTICE OF SWING LINE BORROWING" means a notice substantially in the form set
out in Exhibit 2 to Schedule F;
"NOTIFICATION DATE" has the meaning specified in Section 10.5(c);
"OBLIGATIONS" means all obligations (monetary and otherwise) of the Borrowers
arising under or in connection with this Agreement and each other Loan Document;
"OBLIGORS" means, collectively, the Borrowers and the Guarantors and "OBLIGOR"
means any one of them;
"OFFICER'S CERTIFICATE" means a certificate signed by any one of the Chairman of
the Board, the President, the Chief Executive Officer, the Chief Operating
Officer, the Chief Financial Officer, any Senior Vice-President, any
Vice-President, the Treasurer, the Controller, the Assistant Treasurer, the
Secretary or the Assistant Secretary of Celestica;
"OFFICIAL BODY" means any national, federal or provincial government or any
government of any political subdivision thereof, or any agency, authority,
board, central bank, monetary authority, commission, department or
instrumentality thereof, or any court, tribunal, grand jury, mediator or
arbitrator, whether foreign or domestic, or any non-governmental regulatory
authority to the extent that the rules, regulations and orders of such body have
the force of law;
"ORGANIC DOCUMENT" means, relative to any body corporate, its articles of
incorporation, its by-laws and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its Shares;
"OTHER TAXES" means any present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies which arise from any
payment made hereunder or from the execution, delivery or registration of, or
otherwise with respect to, any of the Loan Documents, or any other document in
connection herewith;
"OUTSTANDING AMOUNT" has the meaning specified in Section 2.3(c);
"PBGC" means the Pension Benefit Guaranty Corporation and any entity succeeding
to any or all of its functions under ERISA;
"PENSION PLAN" means:
(a) any plan, program, agreement or arrangement that is a pension plan
for the purposes of any federal or provincial pension benefit law or
under the INCOME TAX ACT (Canada) (whether or not registered under
such law) which is maintained or contributed to, or to which there is
or may be an obligation to contribute by any of the Borrowers in
respect of its employees in Canada; and
(b) a "PENSION PLAN", as such term is defined in Section 3(2) of ERISA,
which is subject to Title IV of ERISA (other than a multi-employer
plan as defined in Section 4001(a)(3) of ERISA), and to which the
Borrowers or any of the Subsidiaries or any corporation, trade or
business that is, along with the Borrowers, a member of a Controlled
Group, may have liability;
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"PERMITTED ENCUMBRANCES" means any one or more of the following with respect to
the assets of Celestica or any Restricted Subsidiary:
(a) inchoate or statutory Liens for Taxes, assessments and other
governmental charges or levies which are not delinquent (taking into
account any relevant grace periods) or the validity of which are
currently being contested in good faith by appropriate proceedings
and in respect of which there shall have been set aside a provision
or reserve (to the extent required by GAAP) in an amount which is
adequate therefor;
(b) inchoate or statutory Liens of contractors, sub-contractors,
mechanics, workers, suppliers, materialmen, carriers and others in
respect of construction, maintenance, repair or operation of assets
of Celestica or the relevant Restricted Subsidiary, or otherwise
arising in the ordinary course provided that such Liens are related
to obligations not due or delinquent (taking into account any
applicable grace or cure periods), are not registered as encumbrances
against title to any of the assets of Celestica or the relevant
Restricted Subsidiary and adequate holdbacks are being maintained as
required by applicable legislation or such Liens are being contested
in good faith by appropriate proceedings and in respect of which
there shall have been set aside a provision or reserve (to the extent
required by GAAP) in an amount which is adequate with respect thereto
and provided further that such Liens do not, in the aggregate,
materially detract from the value of the assets of Celestica or any
Material Restricted Subsidiary encumbered thereby or materially
interfere with the use thereof in the operation of the business of
Celestica or any Material Restricted Subsidiary;
(c) easements, rights-of-way, servitudes, restrictions and similar rights
in real property comprised in the assets of Celestica or the relevant
Restricted Subsidiary or interests therein granted or reserved to
other persons, provided that such rights do not, in the aggregate,
materially detract from the value of the assets of Celestica or any
Material Restricted Subsidiary or materially interfere with the use
thereof in the operation of the business of Celestica or any Material
Restricted Subsidiary;
(d) title defects or irregularities which are of a minor nature and which
do not, in the aggregate, materially detract from the value of the
assets of Celestica or any Material Restricted Subsidiary or
materially interfere with the use thereof in the operation of the
business of Celestica or any Material Restricted Subsidiary;
(e) Liens incidental to the conduct of the business or the ownership of
the assets of Celestica or the relevant Restricted Subsidiary (other
than those described in Clauses (f) and (g) of this definition) which
were not incurred in connection with the borrowing of money or the
obtaining of advances of credit (including, without limitation,
unpaid purchase price), and which do not, in the aggregate,
materially detract from the value of the assets of Celestica or any
Material Restricted Subsidiary or materially interfere with the use
thereof in the operation of the business of Celestica or any Material
Restricted Subsidiary;
-15-
(f) Liens securing appeal bonds or other similar Liens arising in
connection with court proceedings (including, without limitation,
surety bonds, security for costs of litigation where required by law
and letters of credit) or any other instrument serving a similar
purpose;
(g) attachments, judgments and other similar Liens arising in connection
with court proceedings; provided, however, that such Liens are in
existence for less than 30 days after the entry thereof or the
execution or other enforcement of such Liens is effectively stayed
and the claims secured thereby are being actively contested in good
faith and by appropriate proceedings;
(h) Liens given to a public utility or any municipality or governmental
or other public authority when required by such utility or other
authority in connection with the operation of the business or the
ownership of the assets of Celestica or the relevant Restricted
Subsidiary, provided that such Liens do not have a Material Adverse
Effect;
(i) Purchase Money Obligations arising in the ordinary course of
business, provided that such Lien is limited to the property so
acquired and is created, issued or assumed substantially concurrently
with the acquisition of such property;
(j) the right reserved to or vested in any Official Body by any statutory
provision or by the terms of any lease, licence, franchise, grant or
permit of any of Celestica or the relevant Restricted Subsidiary, to
terminate any such lease, licence, franchise, grant or permit, or to
require annual or other payments as a condition to the continuance
thereof;
(k) the interests of lessors (including without limitation, security
interests granted in favour of lessors) pursuant to all leases,
including Capital Leases and synthetic leases, under which Celestica
or the relevant Restricted Subsidiary is the lessee;
(l) the extension, renewal or refinancing of any Permitted Encumbrance,
provided that the amount so secured does not exceed the original
amount secured immediately prior to such extension, renewal or
refinancing;
(m) Liens granted over the assets securitized in connection with any
Permitted Securitization Transaction;
(n) Liens granted by Celestica Corp. pursuant to and in accordance with
the Synthetic Lease provided that neither Celestica nor any other
Subsidiary other than Celestica, Celestica Corp. or Celestica
International has any liability in respect of such indebtedness;
(o) Liens granted by Celestica and/or any Restricted Subsidiary pursuant
to future subsidized financing by development entities on terms and
conditions satisfactory to the Administrative Agent and the Majority
Lenders;
(p) Liens granted to secure Acquired Indebtedness, to the extent that (i)
such Liens exist at the time such person or the assets subject to
such Lien are acquired by
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Celestica or a Restricted Subsidiary; (ii) such Liens were not
created in contemplation of the transaction by which the subject
Indebtedness became Acquired Indebtedness; and (iii) such Liens
either (A) only extend to the assets acquired or the assets of the
Person acquired, as applicable, in the transaction pursuant to which
the Acquired Indebtedness became an obligation of a Borrower or a
Restricted Subsidiary or (B) are discharged within 60 days of such
acquisition;
(q) Liens granted in respect of Shares of Unrestricted Subsidiaries;
(r) Liens of the nature contemplated in (b), (c), (d) or (e) above, but
exceeding the materiality thresholds specified therein, securing
indebtedness in the aggregate not greater than U.S. $50,000,000; and
(s) Liens granted by Celestica International in favour of Celestica in
connection with a Loan Agreement made as of November 4, 1996, as
amended, between Celestica International (under its form name
Celestica, Inc.) and 1201541
Ontario Inc. (a predecessor in interest
to Celestica).
"PERMITTED ENCUMBRANCE CERTIFICATE" means a certificate in the form of
Schedule M;
"PERMITTED SECURITIZATION TRANSACTION" means any transaction providing for the
sale, securitization or other asset-backed financing (collectively,
"Securitization Transactions") of:
(i) trade accounts receivable of or owing to Celestica or any Restricted
Subsidiary (and/or contractual rights relating thereto) having an
aggregate book value on the date the relevant Securitization
Transaction is completed that does not exceed the sum of (A) 30% of
the aggregate book value of the trade accounts receivable of or owing
to Celestica and its Restricted Subsidiaries determined on a
consolidated basis, before giving effect to prior Securitization
Transactions of trade accounts receivable that have not been
collected, on or prior to the date on which the relevant
Securitization Transaction is completed, and (B), as long as there
are no Advances outstanding under this Agreement and no advances
(other than letters of credit) under any other credit agreement under
which Celestica or any Restricted Subsidiary is a borrower
(excluding, for greater certainty, overdraft facilities and Acquired
Indebtedness), 50% of the amount by which (1) the aggregate book
value of the inventory that is otherwise available for Securitization
Transactions involving inventory under (ii) below, exceeds (2) the
aggregate book value of all inventory that has been subject to prior
Securitization Transactions effected by Celestica and its Restricted
Subsidiaries; or
(ii) inventory of Celestica or any Restricted Subsidiary (and/or
contractual rights relating thereto) having an aggregate book value
on the date the relevant Securitization Transaction is completed that
does not exceed the sum of (A) 30% of the aggregate book value of the
inventory of Celestica and its Restricted Subsidiaries determined on
a consolidated basis, before giving effect to prior Securitization
Transactions of inventory that has not been incorporated into product
sold to a third party, on or prior to the date on which the relevant
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Securitization Transaction is completed, and (B), as long as there
are no Advances outstanding under this Agreement and no advances
(other than letters of credit) under any other credit agreement under
which Celestica or any Restricted Subsidiary is a borrower
(excluding, for greater certainty, overdraft facilities and Acquired
Indebtedness), 50% of the amount by which (1) the aggregate book
value of the trade accounts receivable of or owing to Celestica and
its Restricted Subsidiaries that are otherwise available for
Securitization Transactions of trade accounts receivable under (i)
above, exceeds (2) the aggregate book value of all trade accounts
receivable that have been subject to prior Securitization
Transactions effected by Celestica and its Restricted Subsidiaries;
provided that the terms and conditions of all such Securitization
Transactions shall be on an Arms' Length basis and on commercially
reasonable and usual terms;
"PERMITTED SUBORDINATED INDEBTEDNESS" means all unsecured Indebtedness of
Celestica, which, in respect of principal, is subordinated in right of payment
to the payment in full in cash of all monetary Obligations and, in respect of
interest, is only so subordinated upon the occurrence and during the continuance
of a Default, in each case, on terms satisfactory to the Administrative Agent
and the Majority Lenders, the terms of which permit Celestica at Celestica's
sole option in all circumstances to satisfy such indebtedness by the issue of
Shares or other securities convertible in all circumstances at the sole option
of Celestica into Shares of Celestica;
"PERSON" means an individual, company, partnership (whether or not having
separate legal personality), corporation (including a business trust and a
Canadian chartered bank), joint stock company, trust, unincorporated
association, joint venture or other entity, or a government, state or political
subdivision thereof or any agency of such government, state or political
subdivision;
"POUNDS STERLING" and "(Pound)" means the lawful currency of the United Kingdom;
"PREDECESSOR CORPORATION" has the meaning described thereto in Section 11.12;
"PREDECESSOR GUARANTEE" has the meaning described thereto in Section 11.12;
"PROPERTY" has the meaning ascribed thereto in Section 10.5(a);
"PURCHASE MONEY OBLIGATIONS" means any Lien created, issued or assumed by
Celestica or any Subsidiary to secure indebtedness assumed as part of, or issued
or incurred to pay or provide funds to pay, all or a part of the purchase price
of any property (other than the shares, stock or other securities of any
Subsidiary or of any corporation which becomes a Subsidiary upon such purchase,
except for an Unrestricted Subsidiary);
"RELEASE" has the meaning specified in Section 6.1(h)(i);
"RESTRICTED SUBSIDIARY" means each and every Subsidiary of Celestica which is
not at the time an Unrestricted Subsidiary. For greater certainty, a Subsidiary
of an Unrestricted Subsidiary shall not be a Restricted Subsidiary;
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"ROLLOVER" means a rollover of a LIBOR Advance pursuant to and in accordance
with Section 2.9;
"ROLLOVER NOTICE" means a notice substantially in the form of Schedule H;
"SCOTIABANK" means The Bank of Nova Scotia, a Canadian chartered bank;
"SENIOR UNSECURED CREDIT AGREEMENT" means the Amended and Restated Credit
Agreement dated as of June 8, 2001 among Celestica and the Subsidiaries of
Celestica designated therein, as borrowers, Scotiabank as Administrative Agent,
Canadian Facility Agent, U.S. Facility Agent and U.K. Facility Agent and
Scotiabank and the Financial Institutions named therein as lenders as same may
be amended, restated, supplemented, extended or replaced from time to time;
"SHARES", as applied to the shares of any corporation or other entity, means the
shares or other ownership interests of every class whether now or hereafter
authorized, regardless of whether such shares or other ownership interests shall
be limited to a fixed sum or percentage with respect to the rights of the
holders thereof to participate in dividends and in the distribution of assets
upon the voluntary or involuntary liquidation, dissolution or winding-up of such
corporation or other entity;
"SPECIAL PURPOSE SUBSIDIARY" means any Subsidiary of Celestica which (a) is
formed for the purpose of effecting any Permitted Securitization Transaction and
engaging in other activities reasonably related thereto, and, where applicable,
(b) is structured as a "BANKRUPTCY-REMOTE SUBSIDIARY" in accordance with
customary practices in the asset-backed securitization market;
"SUBSIDIARY" means, with respect to any Person, any corporation, company or
other similar business entity (including, for greater certainty, a Canadian
chartered bank) of which more than fifty per cent (50%) of the outstanding
Shares or other equity interests (in the case of Persons other than
corporations) having ordinary voting power to elect a majority of the board of
directors or the equivalent thereof of such corporation, company or similar
business entity (irrespective of whether at the time Shares of any other class
or classes of the Shares of such corporation, company or similar business entity
shall or might have voting power upon the occurrence of any contingency) is at
the time directly or indirectly owned by such Person, by such Person and one or
more other Subsidiaries of such Person, or by one or more other Subsidiaries of
such Person;
"SUBSTITUTE LENDERS" has the meaning specified in Section 9.14;
"SUCCESSOR AGENT" has the meaning specified in Section 9.10;
"SUCCESSOR CORPORATION" has the meaning specified in Section 11.12(a);
"SWING LINE ADVANCE" means an Advance made pursuant to the provisions of
Section 2.19(a);
"SWING LINE LENDER" means Scotiabank or such other Lender as may have agreed to
act as a Swing Line Lender and to which Scotiabank and Celestica may have agreed
to acting as a Swing Line Lender from time to time;
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"SYNTHETIC LEASE" means the Master Lease and Open-end Mortgage dated as of
February 12, 1998 made between Celestica Corp. (under its former name, Celestica
Colorado, Inc.) and BMO Leasing (U.S.) Inc., as same may be amended, restated,
supplemented, extended or replaced from time to time, including, without
limitation, the amendment dated December 31, 1998 pursuant to which Celestica
Corp. (under its former name Celestica (USA), Inc.) assumed the liabilities of
Celestica Colorado, Inc. under such Master Lease and Open-end Mortgage;
"TAKE-OVER BID" means an offer to acquire made by Celestica or any Restricted
Subsidiary, alone or acting jointly or in concert with any other Person or
Persons (collectively, the "OFFEROR") to any holder of Shares or securities
convertible, exchangeable or exercisable into Shares (the "TARGET SHARES") of
the offeree issuer, which has not been solicited by or made at the request of
the board of directors of the offeree issuer or with respect to which the board
of directors of the offeree issuer has not recommended acceptance, where the
Target Shares subject to the offer to acquire, together with the Target Shares
held by or on behalf of the offeror on the date of the offer, constitute, in
aggregate, 20% (or such lesser percentage as would require compliance with the
formal requirements governing take-over bids (such as the delivery of circulars
or equivalent disclosure documents to shareholders under Applicable Law)) or
more of the outstanding Target Shares at the date of the offer to acquire, but
excluding any such offer which, under the Applicable Law of the jurisdiction in
which such offer is made, would be exempt from such formal requirements;
"TAKE-OVER BID NOTICE" has the meaning specified in Section 2.3;
"TANGIBLE NET WORTH" of Celestica, on a consolidated basis, means, at any
particular time, without duplication, the sum, determined in accordance with
GAAP, of:
(a) capital stock;
(b) preferred stock;
(c) paid-in capital;
(d) retained earnings; and
(e) cumulative translation adjustment (whether positive or negative);
minus the sum of any amounts shown on account of any:
(f) patents, patent applications, service marks, industrial designs,
copyright and trade marks;
(g) goodwill and other intangibles; and
(h) any equity in, loan to or other investment or interest in an
Unrestricted Subsidiary whatsoever;
"TAXES" includes all present and future income, corporation, capital gains,
capital and value-added and goods and services taxes and all stamp, franchise
and other taxes and levies, imposts, deductions, duties, charges and
withholdings whatsoever together with interest thereon and
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penalties with respect thereto, if any, and charges, fees and other amounts made
on or in respect thereof;
"TORONTO OFFICE" means the office of the Administrative Agent located at 00 Xxxx
Xxxxxx Xxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0 (facsimile:
416-866-5991) or such other address as the Administrative Agent may designate by
notice to Celestica;
"TRANSFER NOTICE" means a notice substantially in the form of Schedule I;
"UNITED STATES DOLLARS" and "U.S. $" means the lawful currency of the United
States of America in immediately available funds; and
"UNRESTRICTED SUBSIDIARY" means a Subsidiary of Celestica designated by
Celestica as such in accordance with Section 5.2 of this Agreement and any
Subsidiary of an Unrestricted Subsidiary.
1.2 HEADINGS
The division of this Agreement into Articles and Sections and the insertion of
an index and headings are for convenience of reference only and shall not affect
the construction or interpretation hereof. The terms "THIS AGREEMENT", "HEREOF",
"HEREUNDER" and similar expressions refer to this Agreement and not to any
particular Article, Section, paragraph or other portion hereof and include any
agreement supplemental hereto. Save as expressly provided herein, references
herein to Articles and Sections are to Articles and Sections of this Agreement.
1.3 USE OF DEFINED TERMS
Unless otherwise defined or the context otherwise requires, terms for which
meanings are provided in this Agreement shall have such meanings when used in
each Drawdown Notice, Conversion Notice, Rollover Notice, Loan Document, notice
and other communication delivered from time to time in connection with this
Agreement or any other Loan Document.
1.4 EXTENDED MEANINGS
Words importing the singular number only shall include the plural and VICE
VERSA, and words importing any gender shall include all genders.
1.5 CROSS REFERENCES
Unless otherwise specified, references in this Agreement and in each other Loan
Document to any Article or Section are references to such Article or Section of
this Agreement or such other Loan Document, as the case may be, and unless
otherwise specified referenced in the Article, Section or definition to any
Clause are references to such Clause of such Article, Section or definition.
1.6 REFERENCE TO AGENT OR LENDERS
Any reference in this Agreement to the Administrative Agent or a Lender shall be
construed so as to include its permitted successors, transferees or assigns
hereunder in accordance with their respective interests.
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1.7 ACCOUNTING TERMS
Unless otherwise specified, all accounting terms used herein or in any other
Loan Document shall be interpreted, all accounting determinations and
computations hereunder or thereunder shall be made, and all financial statements
required to be delivered hereunder or thereunder shall be prepared in accordance
with GAAP and all financial data submitted pursuant to this Agreement shall be
prepared in accordance with such principles, consistently applied; provided
that, if Celestica notifies the Administrative Agent that it wishes to amend any
covenant in Section 7.3 to eliminate the effect of any change in GAAP or any
change in the application of accounting policies on the operation of such
covenant (or the Administrative Agent notifies Celestica that the Majority
Lenders wish to amend Section 7.3 for such purpose), Celestica's compliance with
such covenant shall be determined on the basis of GAAP or accounting policies in
effect immediately before the relevant change in GAAP or change in accounting
policies became effective, until either such notices are withdrawn or such
covenant is amended in a manner satisfactory to Celestica, the Administrative
Agent and the Majority Lenders.
1.8 CONSOLIDATED FINANCIAL STATEMENTS AND CONSOLIDATED ACCOUNTS
Notwithstanding Section 1.7, wherever in this Agreement reference is made to a
consolidated financial statement of Celestica or to a determination to be made
on a consolidated basis, such reference shall be deemed to be to a consolidated
financial statement or consolidated basis, determined in accordance with GAAP,
which consolidates only the financial statements or accounts of Celestica and
its Subsidiaries, excluding all Unrestricted Subsidiaries, with investments by
Celestica or any Restricted Subsidiary in Unrestricted Subsidiaries accounted
for using equity accounting. At any time that Celestica and all Restricted
Subsidiaries have no Unrestricted Subsidiaries, all references to consolidated
financial statements herein shall be deemed to be references to the fully
consolidated financial statements of Celestica.
1.9 NON-BANKING DAYS
Except as otherwise specified herein, whenever any payment to be made hereunder
shall be stated to be due or any action to be taken hereunder shall be stated to
be required to be taken on a day other than a Banking Day, such payment shall be
made or such action shall be taken on the next succeeding Banking Day and, in
the case of the payment of any monetary amount, the extension of time shall be
included for the purposes of computation of interest or fees thereon.
1.10 REFERENCES TO TIME OF DAY
Except as otherwise specified herein, a time of day shall be construed as a
reference to Toronto, Canada time.
1.11 SEVERABILITY
In the event that one or more of the provisions contained in this Agreement
shall be invalid, illegal or unenforceable in any respect under any Applicable
Law, the validity, legality or enforceability of the remaining provisions hereof
shall not be affected or impaired thereby.
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1.12 CURRENCY
All monetary amounts in this Agreement refer to United States Dollars unless
otherwise specified.
1.13 REFERENCES TO STATUTES
Except as otherwise provided herein, any reference in this Agreement to a
statute shall be construed to be a reference to such statute as the same may
have been, or may from time to time be, amended, reformed or otherwise modified
or re-enacted from time to time.
1.14 REFERENCES TO AGREEMENTS
Except as otherwise provided herein, any reference herein to this Agreement, any
other Loan Document or any other agreement or document shall be construed to be
a reference to this Agreement, such Loan Document or such other agreement or
document, as the case may be, as the same may have been, or may from time to
time be, amended, restated, extended, supplemented or replaced.
1.15 CONSENTS AND APPROVALS
Whenever the consent in writing or approval in writing of a party hereto is
required in a particular circumstance, unless otherwise expressly provided for
therein, such consent or approval shall not be unreasonably withheld or delayed
by such party.
1.16 SCHEDULES
The following are the Schedules attached hereto and incorporated by reference
and deemed to be part hereof:
Schedule A - Lenders
Schedule B - Lenders' Commitments
Schedule C - Applicable Margin and Facility Fee
Schedule D - Quarterly Certificate on Covenants
Schedule E - Conversion Notice
Schedule F - Drawdown Notice and Notice of Swing Line Borrowing
Schedule G - Guarantees
Schedule H - Rollover Notice
Schedule I - Transfer Notice
Schedule J - Mandatory Cost Calculation
Schedule K - Opinions of Counsel
Schedule L - Extension Request
Schedule M - Permitted Encumbrance Certificate
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ARTICLE 2
THE FACILITY
2.1 ESTABLISHMENT OF THE FACILITY
Upon the terms and subject to the conditions hereof, each of the Lenders hereby
severally agrees to make its Global Rateable Portion of the Facility available
to the Borrowers as specified in Sections 2.2, 2.3 and 2.19.
2.2 PURPOSE, NATURE AND TERM OF THE FACILITY
(a) The Facility is being made available to the Borrowers by the
Lenders for the business and operations of the Borrowers and
their respective Restricted Subsidiaries, including, without
limitation and for greater certainty, to finance acquisitions of
companies which, after the acquisition thereof, will become
Restricted Subsidiaries or assets which, after the acquisition
thereof, will be owned by Celestica or a Restricted Subsidiary,
the repayment of existing indebtedness and for commercial paper
support.
(b) Advances under the Facility shall not be used by any Borrower to
finance the acquisition of, investment in, loan to or to provide
working capital to an Unrestricted Subsidiary.
(c) Subject to the terms and conditions of this Agreement (including,
without limitation, Section 2.7) the Facility shall be a
revolving credit facility and the Borrowers may borrow, repay and
reborrow under the Facility as they see fit. The Facility shall
terminate, subject to Section 2.7, on the Maturity Date.
2.3 AVAILABILITY OF ADVANCES
(a) The Facility shall be available for Drawdowns by the Borrowers,
at the option of the Borrowers, as follows:
(i) to Celestica or Celestica International, Drawdowns from
Lenders, each in a minimum amount of U.S. $5,000,000 and
integral multiples of U.S. $100,000 in excess thereof, in
United States Dollars by way of Base Rate Canada Advances;
and
(ii) to Celestica or Celestica International, Drawdowns from
Lenders, each in a minimum amount of U.S. $5,000,000 and
integral multiples of U.S. $100,000 in excess thereof, in
United States Dollars by way of LIBOR Advances.
(b) Each Drawdown of an Advance pursuant to Section 2.3(a)(i) or (ii)
shall be made by irrevocable Drawdown Notice, which Drawdown
Notice shall be given by Celestica or Celestica International to
the Administrative Agent, not later than (y) 10:00 a.m. Toronto,
Canada time on the Banking Day prior to the relevant Drawdown
Date in the case of Base Rate Canada Advances, and (z) 10:00 a.m.
London, England time and 10:00 a.m. New York, New York time on
the third
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Banking Day prior to the relevant Drawdown Date in the case of a
LIBOR Advance in United States Dollars.
(c) A Borrower may not make a Drawdown under the Facility if, as a
result of such Drawdown, the sum of (i) the aggregate principal
amount of all LIBOR Advances in United States Dollars outstanding
under the Facility, plus (ii) the aggregate principal amount of
all Base Rate Canada Advances outstanding under the Facility
(collectively, the "OUTSTANDING AMOUNT") would exceed the
aggregate of all Commitments of the Lenders at such time (or such
lesser amount as may be available following a cancellation in
part of the Facility pursuant to Section 2.6).
(d) If a Borrower wishes to make a Drawdown under the Facility for
the purpose of financing a Take-over Bid, such Borrower shall
deliver to the Administrative Agent a written notice (a
"TAKE-OVER BID NOTICE") thereof at least ten (10) Banking Days
prior to the day on which it gives to the Administrative Agent a
Drawdown Notice requesting such Drawdown. Such Take-over Bid
Notice shall include the details of such Take-over Bid. As soon
as possible, but in any event within five (5) Banking Days of the
giving of the Take-over Bid Notice, each Lender shall, acting
reasonably and in good faith, determine whether or not it wishes
to fund its Main Facility Rateable Portion of such Drawdown.
Notwithstanding any other provisions hereof, if any Lender
determines that it does not wish to fund its Main Facility
Rateable Portion of such Drawdown, such Lender shall not be
required to fund its Main Facility Rateable Portion of such
Drawdown and the Drawdown shall be reduced accordingly.
(e) This Section 2.3 shall not apply to Swing Line Advances.
2.4 LENDERS' OBLIGATIONS
(a) The obligations of the Lenders hereunder are several and not
joint.
(b) Save as otherwise specifically provided herein, each Lender shall
participate in each Advance (other than, for certainty, any Swing
Line Advance) referred to in the applicable provisions of Section
2.3 in accordance with its Main Facility Rateable Portion.
The failure of any Lender to make available its share of any Advance required to
be made by it under this Agreement shall not relieve any other Lender of its
obligation to make available its share of any Advance required to be made under
this Agreement.
2.5 REPAYMENT OF FACILITY
(a) Provided that the Facility is not prepaid or accelerated in
accordance with Article 8, each Borrower shall repay the
principal amount of all Advances made to it outstanding under the
Facility, together with accrued and unpaid interest thereon,
subject to Section 2.6 and Section 2.7, on the Maturity Date to
the Administrative Agent.
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(b) All repayments of the Facility by the Borrowers shall be in a
minimum amount equal to the minimum amount of a Drawdown of each
type of Advance set out in Section 2.3 and amounts in excess
thereof in integral multiples of U.S. $100,000, except in the
event of a Rollover of an Advance into a lesser amount than the
Advance then outstanding or a repayment pursuant to paragraph (a)
of this Section 2.5 which may be in any amount.
2.6 PAYMENTS/CANCELLATION OR REDUCTION
Celestica may at any time, upon giving at least three (3) Banking Days' prior
notice to the Administrative Agent, repay, or cause another Borrower to repay
and, in each case, cancel, any drawn portion of the Facility or cancel in full
or, from time to time, in part, any undrawn portion of the Facility; provided,
however, that:
(a) in the event that any such repayment relates to a LIBOR Advance
other than on the scheduled last day of the applicable Interest
Period, the Borrower to which such Advance was made shall
contemporaneously pay to the Administrative Agent all applicable
breakage costs, being any loss or expense incurred by the Lenders
by reason of the resulting liquidation or re-employment of
deposits of funds;
(b) any such reduction shall be in a minimum amount of U.S.
$5,000,000 and cancellations in excess thereof shall be in
increments of U.S. $100,000;
(c) any cancellation shall reduce the Commitment of each Lender on a
PRO RATA basis having regard to the Commitment of each Lender;
and
(d) any such cancellation shall permanently reduce the Facility and
may not be reinstated.
2.7 EXTENSION OF MATURITY DATE
(a) MATURITY DATE. Subject to Section 2.6, this Section 2.7, Section
8.2 and Section 8.5, the Facility shall be available until the
Maturity Date. Notwithstanding the termination of availability of
the Facility, until all of the Obligations (other than contingent
indemnity obligations) of the Borrowers shall have been fully and
indefeasibly paid and satisfied and all financing arrangements
among the Borrowers and the Lenders with respect to the
Obligations shall have been cancelled or terminated, all of the
rights and remedies under this Agreement and the other Loan
Documents shall survive.
(b) EXTENSION OF MATURITY DATE. Not more than 90 days nor less than
60 days before the Maturity Date, Celestica may request, by
delivery of an Extension Request (which shall include the consent
of all Guarantors) to the Administrative Agent, that the Maturity
Date be extended for an additional period of one year. Within 5
days after receipt of such Extension Request, the Administrative
Agent shall notify each Lender of the Extension Request by
Celestica and provide each Lender with a copy of such Extension
Request. Within 25 days after Celestica
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has delivered such Extension Request, each Lender shall give the
Administrative Agent notice in writing of its decision to agree
to so extend or to deny the requested extension (and the failure
to provide such notice shall be deemed to be a decision to deny
the requested extension). Within 5 days following the aforesaid
25 day period, the Administrative Agent shall give written notice
to Celestica and the Lenders advising as to those Lenders who
have agreed to the requested extension (for purposes of this
Section 2.7, the "APPROVING LENDERS") and those Lenders who have
not agreed to or who have been deemed to have not agreed to the
requested extension (for purposes of this Section 2.7, the
"DISSENTING LENDERS").
(i) If all Lenders approve the requested extension, the
Facility shall be extended for a further one year and the
Facility shall be available until and each Borrower shall
repay all Advances and other amounts in accordance with
Section 2.5 on the Final Maturity Date.
(ii) If Lenders having Commitments equal to at least 66-2/3%
but less than 100% of the Commitments approve the
requested extension then an Approving Lender, at its
option, may acquire all or any portion of the rights and
obligations of the Dissenting Lenders under the Facility
by giving written notice to the Administrative Agent of
the portion of the rights and obligations of the
Dissenting Lenders which such Approving Lender is
prepared to acquire. Such notice shall be given within
10 days following receipt of the notice from the
Administrative Agent advising as to the Approving
Lenders and the Dissenting Lenders pursuant to Section
2.7(b). If more than one Approving Lender gives notice
to the Administrative Agent that it wishes to acquire
all or a portion of the rights and obligations of the
Dissenting Lenders under the Facility, then each
Approving Lender shall, subject to Section 2.7(b)((iii)
be entitled to acquire its pro rata share of the rights
and obligations of the Dissenting Lenders under the
Facility. For the purpose of this Section 2.7(b)(ii),
the Approving Lenders' pro rata shares shall be
determined based on the Commitments (before acquisition
under this Section 2.7(b)(ii)) of each of the Approving
Lenders wishing to acquire a portion of the rights and
obligations of the Dissenting Lenders under the
Facility. The Administrative Agent shall give written
notice to Celestica within five days following the
expiry of the time for Approving Lenders to give notice
of acquisition pursuant to this Section 2.7(b)(ii), of
the Commitments of the Dissenting Lenders so acquired.
(iii) If one or more of the Approving Lenders (for purposes of
this Section 2.7(b)(iii), the "ACQUIRING LENDERS") has
given notice to the Administrative Agent that it wishes to
acquire all or a portion of the rights and obligations of
the Dissenting Lenders under the Facility pursuant to
Section 2.7(b)(ii), then, concurrently with the notice
given to Celestica pursuant to Section 2.7(b)(ii), the
Administrative Agent shall give notice to each of the
Acquiring Lenders setting out the Commitments of and the
amount of the outstanding Advances made by the Dissenting
Lenders to
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be acquired by each of the Acquiring Lenders in accordance
with Section 2.7(b)(ii) and of the date (for purposes of
this Section 2.7(b)(iii), the "ACQUISITION DATE") on which
the acquisition shall be effective. The Acquisition Date
shall be the tenth day following the date of the notice
given pursuant to this Section 2.7(b)(iii). At or before
11:00 a.m. (Toronto, Canada time) on the Acquisition Date,
each Acquiring Lender shall deposit with or transfer to the
Administrative Agent for the account of the Dissenting
Lenders an amount equal to the amount of the outstanding
credit to be acquired by it pursuant to this Section
2.7(b)(iii). Upon receipt of such amounts, the
Administrative Agent shall (i) disburse such amounts to
each of the Dissenting Lenders in accordance with their
respective entitlement thereto against delivery of forms of
Transfer Notice executed by each of the Dissenting Lenders;
and (ii) make appropriate entries in the books of account
regarding the Facility. The provisions of Section 11.11(b),
(c) and (d) shall apply MUTATIS MUTANDIS to any acquisition
pursuant to this Section 2.7(b)(iii). Each acquisition of
the outstanding Advances of a Dissenting Lender by an
Acquiring Lender shall be subject to the prior consent of
Celestica, which consent shall not be unreasonably withheld
or delayed, provided that it shall not be unreasonable for
Celestica to withhold its consent if such acquisition gives
rise to a claim for increased costs pursuant to Article 3
or any obligation on the part of an Obligor to deduct or
withhold any Taxes from or in respect of any sum payable
under this Agreement, in excess of what would have been the
case without such acquisition, but it shall be unreasonable
for Celestica to withhold its consent if such Acquiring
Lender waives the rights to any benefits under Section 3.5
in respect of the Advances purchased by it pursuant to this
clause (iii).
(iv) If Lenders having Commitments equal to at least 66-2/3%
but less than 100% of the Commitments approve the
requested extension and if the Acquiring Lenders have
not acquired all of the rights and obligations of the
Dissenting Lenders pursuant to Section 2.7(b)(iii), then
Celestica may, at its option, either (A) locate one or
more other financial institutions (for purposes of this
Section 2.7(b)(iv), "ALTERNATE LENDERS"), satisfactory
to the Administrative Agent acting reasonably, to become
Lenders and to acquire all or a pro rata share of the
rights and obligations of the Dissenting Lenders under
the Facility which have not been acquired by the
Acquiring Lenders or (B) repay to the Administrative
Agent on behalf of such Dissenting Lenders all of the
outstanding Advances which have been advanced by such
Dissenting Lenders and all accrued and unpaid interest
and fees thereon without any repayment to any other
Lenders. For the purpose of this Section 2.7(b)(iv), the
Alternate Lenders' pro rata shares shall be determined
based on the Commitments of each of the Alternate
Lenders wishing to acquire a portion of the rights and
obligations of the Dissenting Lenders under the
Facility. If all of the rights and obligations of the
Dissenting Lenders have not been acquired by Acquiring
Lenders or Alternate Lenders or both or if all of the
credit outstanding hereunder
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which has been extended by such Dissenting Lenders and all
accrued and unpaid interest and fees thereon have not been
repaid as aforesaid on or before the Maturity Date, there
shall be no extension of the Maturity Date and Section
2.7(b)(v) shall apply. If (A) all of the rights and
obligations of the Dissenting Lenders have been acquired by
Acquiring Lenders and/or Alternate Lenders and/or (B) if
all of the Advances outstanding hereunder which have been
advanced by such Dissenting Lenders and all accrued and
unpaid interest and fees thereon have been repaid as
aforesaid on or before the Maturity Date, the Facility
shall be extended for a further one year and this Facility
shall be available until and each Borrower shall repay all
Advances and other amounts in accordance with Section
2.5(b) on the Final Maturity Date.
(v) If Lenders having Commitments of less than 66-2/3% of the
Commitments under the Facility approve the requested
extension then the Facility shall be available until, and
each Borrower shall repay all Advances and other amounts in
accordance with Section 2.5 on the Maturity Date.
A Dissenting Lender shall remain committed to make Advances under the Facility
until the earlier of the date on which the Obligations owing to it are assigned
or repaid as aforesaid and the Maturity Date.
2.8 INTEREST ON BASE RATE CANADA ADVANCES
Interest on each Base Rate Canada Advance shall accrue at a rate per annum equal
to the Base Rate Canada in effect from time to time during the period of time
that the Base Rate Canada Advance is outstanding plus the Applicable Margin.
Such interest shall be payable to the Administrative Agent at its Toronto Office
in United States Dollars quarterly in arrears on the last Banking Day of each of
March, June, September and December (each hereinafter referred to as an
"INTEREST PAYMENT DATE") in each year for the period from and including the
Drawdown Date for such Advance (or, if applicable, the date on which such
Advance was converted into a Base Rate Canada Advance) or the preceding Interest
Payment Date for such Base Rate Canada Advance, as the case may be, to and
including the day preceding such Interest Payment Date and shall be calculated
on the principal amount of the Base Rate Canada Advance from time to time
outstanding during such period and on the basis of the actual number of days
elapsed and the number of days deemed to be included in a year by the definition
of the rate used to set Base Rate Canada. Changes in the Base Rate Canada shall
cause an automatic and immediate adjustment of the interest rate payable on Base
Rate Canada Advances without the necessity of any notice to the Borrowers.
2.9 LIBOR ADVANCES
(a) LIBOR Advances shall be available for Drawdown, Conversion or
Rollover in United States Dollars in minimum principal amounts of
U.S. $5,000,000 and integral multiples of U.S. $100,000 in excess
thereof. Each Drawdown Notice shall specify the applicable
Interest Period for the LIBOR Advance. The duration of each such
Interest Period shall be for a period of approximately one, two,
three or six months, as the Borrower requesting such Drawdown,
Conversion or
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Rollover may select in the applicable Drawdown Notice, Conversion
Notice or Rollover Notice. No LIBOR Advance may have an Interest
Period ending after the Maturity Date. If any Interest Period
would end on a day which is not a Banking Day, such Interest
Period shall be extended to the next succeeding Banking Day
unless such next succeeding Banking Day falls in the next
calendar month, in which case such Interest Period shall be
shortened to end on the immediately preceding Banking Day.
(b) If a Lender determines that deposits of the necessary amount for
the applicable Interest Period are not available in the London
interbank market or if for any other reason the Administrative
Agent, acting reasonably, is unable to determine the applicable
LIBO Rate, then the relevant LIBOR Advance will not be made, and
the Administrative Agent will discuss with such Borrower the
particular circumstances and implications of such event. In the
event that such determination is made by the Administrative Agent
in the case of a proposed Rollover of an existing LIBOR Advance
or a proposed Conversion of a Base Rate Canada Advance into a
LIBOR Advance, the proposed LIBOR Advance will automatically be
deemed to be a Base Rate Canada Advance.
(c) Interest on any LIBOR Advance shall be calculated at a rate per
annum equal to the LIBO Rate plus the Applicable Margin, plus any
applicable Mandatory Cost then in effect, shall accrue from day
to day and shall be calculated on the basis of the actual number
of days elapsed (including the first day of each Interest Period
but excluding the last day thereof) and divided by 360 or by 365
where market practice so requires. Interest on any LIBOR Advance
shall be payable to the Administrative Agent in United States
Dollars in arrears on the last day of the Interest Period
relating thereto; provided, however, that if the Interest Period
is for a term of more than three months, interest shall be
payable on the last Banking Day of the first three-month period
and on the last Banking Day of each three-month period
thereafter, as well as on the last day of the Interest Period.
(d) If a LIBOR Advance to a Borrower is neither repaid on the last
day of an Interest Period nor converted into another type of
Advance on such date pursuant to Section 2.12, and if the
Administrative Agent has not received a Rollover Notice or a
Conversion Notice specifying the term of the next Interest Period
for such LIBOR Advance at or before 10:00 a.m. (local time in
Toronto, Canada) on the third Banking Day prior to the last day
of the then current Interest Period, then the outstanding LIBOR
Advance shall be deemed to be converted, by way of Conversion on
the last day of the then current Interest Period, into a Base
Rate Canada Advance.
(e) Except as otherwise provided herein, LIBOR Advances shall not be
repaid, prepaid or converted into another type of Advance except
on the last day of any Interest Period relating thereto.
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2.10 METHOD AND PLACE OF PAYMENT
(a) Each payment to be made by a Borrower under this Agreement shall
be made without deduction, set-off or counterclaim.
(b) All payments of principal, interest and fees hereunder shall be
made for value at or before 12:00 noon (Toronto, Canada time) on
the day such amount is due by deposit or transfer thereof to the
account of the Administrative Agent maintained at its Toronto
Office. Payments received after such time shall be deemed to have
been made on the next following Banking Day.
(c) Subject to Section 9.16, each Lender shall be entitled to its
Main Facility Rateable Portion of each repayment or prepayment of
principal of a Base Rate Canada Advance (other than a Swing Line
Advance) or a LIBOR Advance.
(d) Notwithstanding Section 2.9(c), in the event that a Borrower is
required to pay Additional Compensation to a Lender, such
Borrower may prepay all or any portion of the Advances made by
such Lender to such Borrower, without any obligation to prepay
any portion of the Advances made by other Lenders to whom the
Borrower is not required to pay Additional Compensation;
provided, however, that any prepayment of a LIBOR Advance shall
be subject to the provisions of Section 10.2.
2.11 FEES
(a) During the period commencing on the date hereof and ending on the
Maturity Date (the "RELEVANT PERIOD"), Celestica on behalf of
itself and Celestica International shall pay to the
Administrative Agent for the account of the Lenders a fee (the
"FACILITY FEE") calculated at the rate per annum set forth in
Schedule C on the aggregate Commitments (after giving effect to
any increase, cancellation or reduction pursuant to Sections 2.6,
2.7 and 2.20) hereunder during the relevant period from day to
day which fee shall be payable quarterly in arrears.
(b) Celestica shall pay to the Administrative Agent for its own
account the fees specified in the letter dated June 26, 2001
addressed by the Administrative Agent to Celestica.
2.12 CONVERSION OPTIONS
Subject to the provisions of this Agreement, provided that no Event of Default
has occurred and is continuing, a Borrower may convert any type of Advance
outstanding under the Facility as follows:
(a) a Base Rate Canada Advance or a portion thereof into a LIBOR
Advance by giving the Administrative Agent a Conversion Notice no
later than 10:00 a.m. three (3) Banking Days prior to the date of
the proposed Conversion;
(b) a LIBOR Advance or a portion thereof into a Base Rate Canada
Advance on the last day of the Interest Period of the relevant
LIBOR Advance by giving the
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Administrative Agent a Conversion Notice no later than 10:00 a.m.
one (1) Banking Day prior to the date of the proposed Conversion.
2.13 EXECUTION OF NOTICES
All Drawdown Notices, Conversion Notices, Rollover Notices and notices of
repayment or cancellation and, unless otherwise provided herein, all other
notices, requests, demands or other communications to be given to the
Administrative Agent by a Borrower hereunder shall be executed by any one
officer or director of the Borrower making each such Drawdown Notice, Conversion
Notice, Rollover Notice or notice of repayment or cancellation.
2.14 EVIDENCE OF INDEBTEDNESS
The Administrative Agent shall open and maintain in accordance with its usual
practice books of account evidencing all Advances and all other amounts owing by
the Borrowers to the Administrative Agent and the Lenders hereunder, details of
every Drawdown Date in respect of each Advance and all amounts from time to time
owing or paid by a Borrower to the Administrative Agent for its own account or
for the account of the Lenders hereunder, the amounts of principal, interest and
fees payable from time to time hereunder and the unused portion of each Lenders'
Commitment available to be drawn down by the Borrowers. The information entered
in the foregoing accounts shall constitute, in the absence of manifest error,
PRIMA FACIE evidence of the obligations of the Borrowers to the Administrative
Agent and the Lenders hereunder, the date the Lenders made each Advance
available to the Borrowers and the amounts the Borrowers have paid from time to
time on account of the principal of and interest on the Advances.
2.15 INTEREST ON UNPAID COSTS AND EXPENSES
Unless the payment of interest is otherwise specifically provided for herein,
where a Borrower fails to pay any amount required to be paid by a Borrower
hereunder when due, having received notice that such amount is due, such
Borrower shall pay interest to the Administrative Agent on such unpaid amount,
including overdue interest from the time such amount is due until paid at an
annual rate equal to the sum of (i) 2%, plus (ii) the Base Rate Canada. Such
interest shall be determined daily, compounded quarterly in arrears on each
Interest Payment Date in each year and payable on demand.
2.16 CRIMINAL RATE OF INTEREST
Notwithstanding the foregoing provisions of this Article 2, the Borrowers shall
in no event be obliged to make any payments of interest or other amounts payable
to the Lenders hereunder in excess of an amount or rate which would be
prohibited by law or would result in the receipt by the Lenders of interest at a
criminal rate (as such terms are construed under the CRIMINAL CODE (Canada)).
2.17 COMPLIANCE WITH THE INTEREST ACT (CANADA)
For the purposes of this Agreement, whenever any interest is calculated on the
basis of a period of time other than a calendar year, the annual rate of
interest to which each rate of interest determined pursuant to such calculation
is equivalent for the purposes of the INTEREST ACT
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(Canada) is such rate as so determined multiplied by the actual number of days
in the calendar year in which the same is to be ascertained and divided by the
number of days used in the basis of such determination.
2.18 NOMINAL RATE OF INTEREST
The parties acknowledge and agree that all calculations of interest under the
Loan Documents are to be made on the basis of the nominal interest rate
described herein and not on the basis of effective yearly rates or on any other
basis which gives effect to the principle of deemed reinvestment of interest.
The parties acknowledge that there is a material difference between the stated
nominal interest rates and the effective yearly rates of interest and that they
are capable of making the calculations required to determine such effective
yearly rates of interest.
2.19 SWING LINE FACILITY
(a) SWING LINE ADVANCES. Subject to subsections (b) and (k), the
Swing Line Lender hereby agrees, on the terms and conditions set
forth in this Agreement, to make Swing Line Advances in United
States Dollars to Celestica or Celestica International from time
to time from the date hereof to the Maturity Date.
(b) LIMITATION ON SWING LINE ADVANCES. No Swing Line Advance shall be
made by the Swing Line Lender if:
(i) the sum of (A) the amount of such Swing Line Advance and
(B) the aggregate principal amount of all Swing Line
Advances outstanding on such day exceeds the Available
Swing Line Commitment; or
(ii) immediately after such Swing Line Advance is made, the
aggregate outstanding principal amount of all Advances
exceeds the aggregate Commitments.
(c) AMOUNT OF EACH SWING LINE ADVANCE. Each Swing Line Advance shall
be in an aggregate principal amount of U.S. $1,000,000 or any
integral multiple thereof.
(d) INTEREST RATES. Each Swing Line Advance shall bear interest on
the outstanding principal amount thereof, for each day from the
date such Swing Line Advance is made until it becomes due, at a
rate per annum equal to, the Base Rate Canada plus the Applicable
Margin.
(e) PROCEDURE FOR REQUESTING SWING LINE ADVANCES. The relevant
Borrower shall give to the Administrative Agent telephonic notice
no later than 10:00 a.m. (local time) on the date of each Swing
Line Advance specifying (i) the date of such Swing Line Advance,
which shall be a Banking Day in Toronto, Canada; and (ii) the
amount of such Swing Line Advance. Such telephonic notice shall
be followed by delivery by the relevant Borrower by no later than
3:00 p.m. local time on the same day of a Notice of Swing Line
Borrowing. Promptly after receiving such Notice of Swing Line
Borrowing, the Administrative Agent shall notify the relevant
Swing Line Lender of the contents thereof and such Notice of
Swing Line Borrowing shall not thereafter be revocable by such
Borrower.
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(f) FUNDING OF SWING LINE ADVANCES. On the date of each Swing Line
Advance, the Swing Line Lender shall make available such Swing
Line Advance no later than 12:00 noon, Toronto, Canada time.
(g) OPTIONAL PREPAYMENT OF SWING LINE ADVANCES. Any Borrower may
prepay its Swing Line Advance in whole at any time or from time
to time in part in a minimum principal amount of U.S. $1,000,000,
as the case may be, or any integral multiple thereof, by giving
notice of such prepayment to the Administrative Agent not later
than 10:00 a.m. Toronto, Canada time on the date of prepayment
and paying the principal amount to be prepaid (together with
interest accrued thereon to the date of prepayment) to the
Administrative Agent for the account of the Swing Line Lender.
(h) MATURITY OF SWING LINE ADVANCES. Any Swing Line Advance
outstanding on the seventh day after such Swing Line Advance, if
not repaid by such Borrower on such seventh day, shall convert to
a Base Rate Canada Advance. If, prior to the seventh day after
such Swing Line Advance was made, the Administrative Agent
declares the Advances to be immediately due and payable or the
Commitments automatically terminate, each as set out in Section
8.2, such Swing Line Advance shall be due and payable on the date
of such declaration by the Administrative Agent or automatic
termination.
(i) REFUNDING UNPAID SWING LINE ADVANCES. If any Swing Line Advance
is converted, pursuant to subsection (h), to another form of
Advance, the Swing Line Lender shall forthwith notify the
Administrative Agent and the Administrative Agent shall, by
notice to the Lenders (including the Swing Line Lender in its
capacity as Lender), require the Lenders to pay to the
Administrative Agent, for the account of the Swing Line Lender,
their Main Facility Rateable Portion of the aggregate amount of
such other form of Advance. Such other form of Advance shall
constitute, a Base Rate Canada Advance, provided that if the
Lenders are prevented from making such Advances by provisions of
applicable bankruptcy laws or otherwise, the amount so paid by
each Lender shall constitute a purchase by it of a participation
in the unpaid principal amount of such converted Swing Line
Advances. Any such notice to the Lenders shall specify the date
on which such payments are to be made by them. No later than
12:00 noon Toronto, Canada time on the date so specified each
Lender shall pay the amount so notified to it in immediately
available funds to the Administrative Agent for the account of
the Swing Line Lender. Each Lender's obligations to make payments
for the account of the Swing Line Lender under this subsection
shall be absolute and unconditional and shall not be affected by
any circumstance provided that no Lender shall be obligated to
make any payment to the Administrative Agent under this Section
with respect to a Swing Line Advance made by the Swing Line
Lender at a time when the Swing Line Lender had received written
notice from Celestica or the Administrative Agent that a Default
had occurred and was continuing.
(j) INCREASING OR DECREASING AVAILABLE SWING LINE COMMITMENT. At any
time and from time to time, Celestica may, by written notice to
the Administrative
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Agent, increase or decrease the Available Swing Line Commitment,
provided that the Available Swing Line Commitment shall at no
time exceed U.S. $75,000,000 less the amount, if any, that the
Commitment of the Swing Line Lender has been reduced pursuant to
Section 2.6 or be less than zero.
(k) TAKE-OVER BIDS. If a Borrower wishes to make a Drawdown of a
Swing Line Advance for the purpose of financing a Take-over Bid,
such Borrower shall deliver to the Swing Line Lender a Take-over
Bid Notice at least ten (10) Banking Days prior to the day on
which it gives to the Swing Line Lender a telephonic notice or
Notice of Swing Line Borrowing requesting such Drawdown. Such
Take-over Bid Notice shall include the details of such Take-over
Bid. As soon as possible, but in any event within five (5)
Banking Days of the giving of the Take-over Bid Notice, the Swing
Line Lender shall, acting reasonably and in good faith, determine
whether or not it wishes to fund such Swing Line Advance.
Notwithstanding any other provisions hereof, if the Swing Line
Lender determines that it does not wish to fund such Swing Line
Advance, the Swing Line Lender shall not be required to fund such
Swing Line Advance.
2.20 INCREASE IN AGGREGATE COMMITMENT AMOUNT TO U.S.$750,000,000
(a) Notwithstanding any other provision of this Agreement, each of
the parties hereto agree that Celestica may, from time to time
and at any time, give notice to the Administrative Agent that one
or more financial institutions (each an "ADDITIONAL LENDER") have
agreed to make commitments (each an "ADDITIONAL COMMITMENT")
hereunder (provided, however, that Celestica shall not be
entitled to give such notice at any time at which the aggregate
Commitments is equal to U.S. $750,000,000 (or such lesser amount
as may be available following a cancellation in part of the
Facility pursuant to Section 2.6)). Upon receipt of such written
notice, each party hereto hereby irrevocably authorizes the
Administrative Agent to:
(i) insert the name of the Additional Lender that will become a
Lender on Schedule A;
(ii) amend Schedule B to reflect the Additional Commitment of
the Additional Lender;
(iii) affix signature pages of the Additional Lender to this
Agreement; and
(iv) if Advances (other than Swing Line Advances) are
outstanding at the time such notice is given, then the
Additional Lender shall make available to the
Administrative Agent an amount equal to its Main Facility
Rateable Portion (calculated as if the Additional
Commitment were a Commitment) of such Advances and the
Administrative Agent shall make available to each Lender
that Lender's Main Facility Rateable Portion (calculated
without reference to the Additional Commitment) of such
amount,
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whereupon each of the Borrowers, the Administrative Agent,
each Lender and the Additional Lender shall acquire the
same rights and assume the same obligations between
themselves as they would have acquired and assumed had such
Additional Lender been original parties hereto as Lenders.
(b) Each of the parties hereto agrees that it will promptly execute
and deliver all such documents, including, without limitation,
all such additional conveyances, transfers and consents and other
assurances, and do all such other acts and things as may from
time to time be desirable in order to better evidence or give
effect to this Section 2.20.
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ARTICLE 3
CHANGE OF CIRCUMSTANCES
AND INDEMNIFICATION
3.1 LENDER REPRESENTATION
Each Lender represents to each of Celestica and Celestica International and the
Administrative Agent that it is resident in Canada for the purposes of the
INCOME TAX ACT (Canada) and that it is beneficially entitled to the principal,
interest and fees payable to it under the Loan Documents. The foregoing
representation shall be true and correct and shall be deemed to be given by each
Lender on each day that a payment of interest, principal or fees is to be made
to it pursuant to a Loan Document.
3.2 INCREASED COSTS
In the event of (i) any Applicable Law coming into force after the date hereof,
(ii) any change in any Applicable Law, or in the interpretation or application
thereof by any court or by any governmental, regulatory, other authority or
central bank charged with the administration thereof, or (iii) compliance by any
Lender with any direction, request or requirement (whether or not having the
force of law but, if not having the force of law, one with which a responsible
bank acting reasonably would comply) of any government, monetary authority,
central bank or comparable agency (each such event being hereinafter referred to
as a "CHANGE IN LAW") which now or hereafter:
(a) subjects a Lender to any Tax or changes the basis of taxation, or
increases any existing Tax (in each case, except for the coming
into force of any Tax or change in the basis of taxation in
respect of or the change in the rate of Tax charged on net income
as a whole, on franchises or capital applicable to the relevant
jurisdictions of the Lender), on payments of principal, interest
or other amounts payable by the Borrowers to such Lender under
any Loan Document or on or by reference to the amount of any
Advances made or to be made by any Lender hereunder or on or by
reference to the Commitment of any Lender, or
(b) imposes, modifies or deems applicable any reserve, deposit, ratio
or similar requirements or otherwise imposes any cost on any
Lender in funding or maintaining all or any of the Advances or
its Commitment; or
(c) has the effect of increasing the amount of overall capital
required to be maintained by a Lender, taking into account the
existence of such Lender's participation in any Advance or any of
its obligations under any Loan Document (including, without
limitation, all or any part of its Commitment),
and the result of any of the foregoing is to increase the cost to
a Lender, reduce the income receivable by it or reduce the
effective return on the capital of such Lender in respect of any
Advances and/or its Commitment to an extent which such Lender
believes to be material (after consultation with Celestica), the
Lender shall give notice thereof to the Administrative Agent and
the Administrative Agent shall give notice thereof to the
Borrowers (herein called a "NOTICE OF
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AMOUNT") stating the event by reason of which it believes it is
entitled to Additional Compensation, such cost and/or such
reduction in such return (or such proportion of such reduction as
is, in the reasonable and BONA FIDE opinion of such Lender,
attributable to its obligations hereunder), the amount of such
Additional Compensation (as hereinafter defined) incurred by such
Lender and supplying reasonable supporting evidence (including,
in the event of change of Applicable Law, a photocopy of the
Applicable Law evidencing such change together with a certificate
of a duly authorized officer of the Lender setting forth the
Additional Compensation and the basis for calculation of such
Additional Compensation and an opinion in writing of such
Lender's counsel confirming such change); provided that the
Lender shall not be required to disclose any information required
to be kept confidential by Applicable Law (in which case the
requirement of such confidentiality shall be supported by an
opinion of such Lender's Counsel) within ten (10) Banking Days of
the date of receipt of any Notice of Amount, the amount set out
therein (in this Article 3 referred to as "ADDITIONAL
COMPENSATION") shall be paid to the Lender by Celestica and
Celestica International. In the event such Lender subsequently
recovers all or part of the Additional Compensation paid by the
Borrowers, it shall repay an equal amount to such Borrowers.
3.3 ILLEGALITY
If, with respect to any Lender, the implementation of any existing provision of
Applicable Law or the adoption of any Applicable Law, or any change therein or
in the interpretation or application thereof by any court or by any statutory
board or commission now or hereafter makes it unlawful for such Lender to make,
fund or maintain all or any portion of an outstanding Advance, to maintain all
or any part of its Commitment hereunder or to give effect to its obligations in
respect of all or any portion of an outstanding Advance, such Lender may, by
written notice thereof to the Borrowers and the other Lenders through the
Administrative Agent (supported, at the request and expense of the Borrowers, by
an opinion of such Lender's counsel), declare the obligations of such Lender
under this Agreement to be terminated whereupon the same shall forthwith
terminate, and the Borrowers to whom such Lender has made Advances shall repay
within the time required by such law (or as promptly as practicable if already
unlawful or at the end of such longer period, if any, as such Lender in its BONA
FIDE opinion may agree) the principal of the Advances made by such Lender. If
any such change shall affect only that portion of such Lender's obligations
under this Agreement that is, in the BONA FIDE opinion of such Lender, severable
from the remainder of this Agreement so that the remainder of this Agreement may
be continued in full force and effect without otherwise affecting any of the
obligations of such Lender or the Borrowers hereunder, such Lender shall declare
its obligations under only that portion so terminated.
3.4 MITIGATION
(a) If, in respect of any Lender, circumstances arise which would
result, upon the giving of notice, in:
(i) Additional Compensation being paid by a Borrower to a
Lender under Section 3.2; or
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(ii) a reduction of all or any of an Advance by such Lender or
the Lender's Commitment pursuant to Section 3.3; or
(iii) the prepayment of the portion of the Advances outstanding
to it pursuant to Section 3.3; or
(iv) the payment of any amount by an Obligor under Section 3.5;
then such Lender, promptly upon becoming aware of the same and
the possible results thereof, shall notify the Administrative
Agent thereof and the Administrative Agent shall notify the
Borrowers thereof and, in consultation with the Borrowers shall
take such steps, if any, as such Lender in its BONA FIDE opinion
considers appropriate to mitigate the effects of such
circumstances. Without limiting the generality of the foregoing,
if it is commercially reasonable, such Lender shall make
reasonable efforts to limit the incidence of any such Additional
Compensation and seek recovery for the account of the Borrowers
upon the Borrower's request and at the Borrower's expense;
provided that such Lender in its reasonable determination suffers
no appreciable economic, legal, regulatory or other disadvantage.
In all events, the Lenders shall promptly co-operate with the
Borrowers to the extent possible, to rearrange the affected
availment to one that may not be affected by such change, but
failure to effect a change in availment shall not relieve the
relevant Borrower of its obligation to pay the Additional
Compensation. Notwithstanding the foregoing provisions, a Lender
shall only be entitled to rely upon the provisions of Section 3.2
if and for so long as it is not treating the Borrowers in any
materially different or in any less favourable manner than is
applicable to any other customers of any Lender, where such other
customers are bound by similar provisions to the foregoing
provisions of Section 3.2.
(b) If any Lender seeks Additional Compensation pursuant to Section
3.2 hereof (the "AFFECTED LENDER"), then the relevant Borrowers
may indicate to the Administrative Agent in writing that they
desire to (i) replace the Affected Lender with one or more of the
other Lenders, and/or (ii) amend a Drawdown Notice or Notice of
Swing Line Borrowing to reduce the amount sought to be borrowed
to reflect the reduced amount hereunder, and the Administrative
Agent shall then forthwith give notice to the other Lenders that
any Lender or Lenders may, in the aggregate, advance all or part
of the Affected Lender's Main Facility Rateable Portion of such
Advance and, in the aggregate, assume all or part of the Affected
Lender's Commitment and obligations hereunder and acquire all or
part of the rights of the Affected Lender and assume all or part
of the obligations of the Affected Lender under each of the other
Loan Documents (but in no event shall any other Lender or the
Administrative Agent be obliged to do so). If a Lender shall so
agree in writing (herein collectively called the "ASSENTING
LENDERS" and individually called an "ASSENTING LENDER") with
respect to such advance, acquisition and assumption, the Main
Facility Rateable Portion of such Advance of each Assenting
Lender (other than a Swing Line Advance) and the Commitment and
the obligations of such Assenting Lender under this Agreement and
the rights and obligations of such Assenting Lender under each of
the other
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Loan Documents shall be increased accordingly on a date mutually
acceptable to such Assenting Lender and the Borrowers. On such
date, the Assenting Lender shall advance to the relevant
Borrowers the relevant portion of the Affected Lender's Main
Facility Rateable Portion of the outstanding Advances (other than
Swing Line Advances) and the relevant Borrowers shall prepay to
the Affected Lender the Advances of the Affected Lender then
outstanding, together with all interest accrued thereon and all
other amounts owing to the Affected Lender hereunder, and, upon
such advance and prepayment, the Affected Lender shall cease to
be a "LENDER" for purposes of this Agreement and shall no longer
have any obligations hereunder. Upon the assumption of the
Affected Lender's Commitment as aforesaid by an Assenting Lender,
Schedule B hereto shall be deemed to be amended to increase the
Commitment of such Assenting Lender by the amount of such
assumption and to reduce the Commitment of the Affected Lender by
a like amount. If no Assenting Lender is found, then in such
event, the relevant Borrower is entitled to repay the Affected
Lender and reduce its obligations hereunder by such amount so
repaid.
3.5 TAXES
(a) All payments by any Obligor under this Agreement or the
Guarantees shall be made free and clear of and without deduction
or withholding for any and all Taxes, unless required by law. If
an Obligor shall be required by law, rule, regulation or the
interpretation thereof by the relevant governmental authority to
deduct or withhold any such Taxes from or in respect of any sum
payable under this Agreement,
(i) the sum payable shall be increased by such additional
amount as may be necessary so that after making all
required deductions or withholdings (including deductions
or withholdings applicable to additional amounts paid under
this Section 3.5), the Lenders or the Administrative Agent,
as applicable, receive a net amount equal to the full
amount they would have received if no deduction or
withholding had been made;
(ii) the Obligor shall make such required deductions or
withholdings;
(iii) the Obligor shall pay the full amount deducted or withheld
to the relevant taxation or other authority in accordance
with Applicable Law; and
(iv) such Obligor shall deliver to the relevant Lender or
Administrative Agent, as applicable, as soon as practicable
after it has made such payment to the applicable authority
(x) a copy of such receipt as is issued by such authority
evidencing the deduction or withholding of all amounts
required to be deducted or withheld from the sum payable
hereunder or (y) if such a receipt is not available from
such authority, notice of the payment of such amount
deducted or withheld;
provided that the obligations of an Obligor to pay
additional amounts pursuant to hereto shall not apply with
respect to Taxes ("EXCLUDED
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TAXES") arising by virtue of a Lender or the Administrative
Agent, as applicable, having a connection with the
jurisdiction that imposes the Taxes other than merely by
the execution of this Agreement, receipt of payments under
this Agreement, the holding and disposition of Advances,
the performance of its obligations or the enforcement of
its rights under this Agreement.
(b) Without prejudice to the foregoing provisions of this Section
3.5, if the Administrative Agent or any Lender (in this Section
3.5, an "INDEMNIFIED PERSON") is required at any time (whether
before or after any Obligor has discharged all of its other
obligations hereunder) to make any payment on account of any Tax
which an Obligor is required to withhold in accordance with
Section 3.5(a) hereof or for which an Obligor is otherwise
required to indemnify a Lender or the Administrative Agent
pursuant to Sections 3.5(a), (c) or (d) hereof, or if any
liability in respect of any such payment is asserted, imposed,
levied or assessed against such Indemnified Person, the Obligor
in respect of which such sum was received or receivable shall,
within 30 days of written demand of the Administrative Agent or
Lender, promptly indemnify such Indemnified Person against such
payment or liability, together with interest, penalties and
expenses payable or incurred in connection therewith including,
without limitation, any Tax imposed by any jurisdiction on or in
relation to any amounts paid to or for the account of such
Indemnified Person pursuant to this Section 3.5. An Indemnified
Person intending to make a claim pursuant to this Section 3.5
shall notify the Obligor of the event in respect of which it
believes it is entitled to make such claim and supply reasonable
supporting evidence including a copy of the relevant portion of
any written assessment, provided that any such Indemnified Person
shall not be required to disclose any information required to be
kept confidential by regulation or contract (in which case the
basis of such confidentiality, at the request and expense of the
Borrowers, shall be supported by an opinion of counsel of
reputable standing).
(c) If an Obligor fails to pay any Taxes required to be paid by it
pursuant to this Section 3.5 when due to the appropriate taxing
authority or fails to remit to the Administrative Agent, for the
account of the respective Lenders, for the account of any other
Agent or for the Administrative Agent's own account, as
applicable, the required receipts or other documentary evidence
required by Section 3.5(a)(ii), the Obligor shall indemnify the
Lenders or Agent, as applicable, for any incremental Taxes,
interest or penalties that may become payable by any Lender or
the Administrative Agent as a result of any such failure. For
purposes of this Section 3.5, a distribution by the
Administrative Agent or any Lender to or for the account of any
Lender shall be deemed a payment by the Obligor.
(d) Each Obligor will indemnify the Lenders and Agents for the full
amount of Taxes imposed by any jurisdiction and paid by such
Lender or Agent, as applicable with respect to any amounts
payable pursuant to this Section 3.5, and any liability arising
therefrom or with respect thereto, whether or not such Taxes were
correctly or legally asserted. This indemnification shall be made
within 30 days from the date such Lender or Agent, as applicable
makes written demand therefor
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which demand shall identify the nature and amount of Taxes for
which indemnification is being sought and shall include a copy of
the relevant portion of any written assessment from the relevant
taxing authority demanding payment of such Taxes.
(e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in
this Section 3.5 shall survive the payment in full of principal,
interest, fees and any other amounts payable hereunder and the
termination of this Agreement and the Guarantees.
3.6 TAX REFUND
(a) If, following the imposition of any Tax on any payment by any
Obligor in consequence of which such Obligor pays an additional
amount under Section 3.5(a), any Lender receives or is granted a
refund of any Tax actually paid by it which in such Lender's sole
opinion (acting in good faith) is attributable to such additional
amount paid by such Obligor and is both identifiable and
quantifiable by it without requiring such Lender or its
professional advisers to expend a material amount of time or
incur a material cost in so identifying or quantifying (any of
the foregoing, to the extent so identifiable and quantifiable,
being referred to as a "REFUND"), such Lender shall, to the
extent that it can do so without prejudice to the retention of
the relevant refund and subject to such Obligor's obligation to
repay promptly on demand by the Lender the amount to such Lender
if the relevant refund is subsequently disallowed or cancelled,
reimburse such Obligor promptly after receipt of such refund by
such Lender with such amount as such Lender shall in its sole
opinion but in good faith have concluded to be the amount or
value of the relevant refund.
(b) Nothing contained in this Agreement shall interfere with the
right of any Lender to arrange its Tax and other affairs in
whatever manner it thinks fit. No Lender shall be required to
disclose any confidential information relating to the
organization of its affairs.
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ARTICLE 4
CONDITIONS PRECEDENT TO DRAWDOWN
4.1 CONDITIONS FOR CLOSING
The following conditions shall be satisfied by the Borrowers on or prior to
Closing:
(a) each Obligor shall have duly authorized, executed and delivered
to the Administrative Agent each of the Loan Documents to which
it is a party and each such Loan Document shall constitute a
legal, valid and binding obligation of such Obligor, enforceable
against such Obligor in accordance with its terms;
(b) each Obligor shall have delivered to the Administrative Agent:
(i) a certified copy of its Organic Documents,
(ii) a certified copy of the resolutions authorizing it to enter
into, execute and deliver the Loan Documents to which it is
a party and to perform its obligations thereunder;
(iii) a certificate as to the incumbency of its officers signing
the Loan Documents to which it is a party; and
(iv) a certificate of status, good standing or like certificate
with respect to such Obligor issued by the appropriate
government officials of the jurisdiction of its
incorporation;
(c) there shall have been no Material Adverse Change since September
30, 2002;
(d) no Default or Event of Default shall have occurred and be
continuing;
(e) each Material Restricted Subsidiary shall have executed and
delivered to the Administrative Agent (i) a confirmation of its
Guarantee if previously provided in connection with the Existing
Credit Agreement; or (ii) a Guarantee;
(f) Celestica shall have executed and delivered to the Administrative
Agent a Guarantee of the monetary Obligations of Celestica
International;
(g) opinions of Borrowers' Counsel, and local counsel to each
Guarantor, substantially in form of Schedule K, shall have been
delivered to the Administrative Agent;
(h) none of the undertaking, property or assets of the Borrowers or
any of the Restricted Subsidiaries shall be subject to any Liens
other than (i) Permitted Encumbrances or (ii) Liens with respect
to which the Administrative Agent shall have received
satisfactory evidence of the repayment of the underlying
obligation and fully executed discharges and releases thereof and
Celestica and each of the Restricted Subsidiaries shall have
delivered to the Administrative Agent a
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Permitted Encumbrance Certificate if any of the undertaking,
property or assets of such Restricted Subsidiary is subject to
any Liens; and
(i) all amounts owing by the Borrowers to the Lenders and the Agents
under the Senior Unsecured Credit Agreement shall have been fully
repaid and such Senior Unsecured Credit Facility shall have been
terminated and cancelled and shall cease to be of any further
force and effect.
The conditions set forth in this Section 4.1 are inserted for the sole benefit
of the Lenders and may be waived by the Administrative Agent on behalf of the
Lenders in whole or in part, with or without terms or conditions.
4.2 CONDITIONS FOR FIRST DRAWDOWN
The following conditions shall be satisfied by the Borrowers on or prior to the
first Drawdown Date after the date hereof:
(a) the representations and warranties set forth in Section 6.1 shall
be true and correct in all material respects on and as of the
Drawdown Date, both before and after giving effect to the
Drawdown of such Advance and to the application of proceeds
therefrom on the Drawdown Date;
(b) no Default or Event of Default shall have occurred and be
continuing, nor shall any such event occur as a result of making
the Advances or the application of proceeds therefrom on the
Drawdown Date; and
(c) any Borrower which intends to make a Drawdown shall have given
the appropriate Drawdown Notice to the Administrative Agent in
accordance with the provisions of Section 2.3.
4.3 CONDITIONS FOR SUBSEQUENT DRAWDOWNS
The following conditions shall be satisfied by the Borrower requesting an
Advance at or prior to the time of each Drawdown of an Advance under the
Facility subsequent to the first Drawdown after the date hereof:
(a) a Borrower shall have given to the Administrative Agent a
Drawdown Notice in accordance with the provisions of Section 2.3;
(b) the representations and warranties set forth in Section 6.1 shall
be, MUTATIS MUTANDIS, true and correct in all material respects
on and as of the Drawdown Date, both before and after giving
effect to the Drawdown of such Advance and to the application of
proceeds therefrom on the Drawdown Date; and
(c) no Default or Event of Default shall have occurred and be
continuing, nor shall any such event occur as a result of making
the Advances or the application of proceeds therefrom on the
Drawdown Date.
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ARTICLE 5
PROVISIONS RELATING TO SUBSIDIARIES
5.1 MATERIAL RESTRICTED SUBSIDIARIES TO PROVIDE GUARANTEES
(a) Each Subsidiary of Celestica which is or becomes a Material
Restricted Subsidiary shall comply with the requirements of
Subsection 7.1(m).
(b) In the event that a Material Restricted Subsidiary ceases to be a
Material Restricted Subsidiary as a result of the diminution of
the value of its assets such that the aggregate value thereof
does not meet the applicable threshold set out in the definition
of Material Restricted Subsidiary under this Agreement, Celestica
may request and the Administrative Agent shall, in its reasonable
discretion, release the Guarantee executed by such Material
Restricted Subsidiary.
5.2 UNRESTRICTED SUBSIDIARIES
Celestica may, from time to time and at any time hereafter, designate any
Subsidiary as an Unrestricted Subsidiary so long as:
(a) (i) such Subsidiary shall not be a Subsidiary existing as at the
date of this Agreement; and (ii) such Subsidiary shall never have
been a Restricted Subsidiary;
(b) neither Celestica nor any of its Subsidiaries (other than
Unrestricted Subsidiaries) shall be liable, contingently or
otherwise, for any indebtedness or other liability or obligation
of the Unrestricted Subsidiary, except for guarantees provided by
the immediate parent of such Unrestricted Subsidiary in respect
of indebtedness of such Unrestricted Subsidiary, where such
guarantees are:
(i) made solely for the purpose of facilitating a pledge by the
guarantor of Shares of such Unrestricted Subsidiary; and
(ii) the recourse under such guarantees are limited to such
pledged Shares; and
(c) neither Celestica nor any of its Restricted Subsidiaries shall
have applied the proceeds of any Advance under the Facility to
fund the equity of, or otherwise capitalize the Unrestricted
Subsidiary.
Provided that an Event of Default has not occurred and is not continuing,
Celestica may from time to time and at any time hereafter, designate an
Unrestricted Subsidiary as a Restricted Subsidiary provided that:
(i) immediately upon giving effect to such designation,
Celestica shall remain in compliance with all covenants set
out in Section 7.3 on a pro-forma (four quarter) basis; and
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(ii) the designation of such Unrestricted Subsidiary as a
Restricted Subsidiary would not otherwise result in the
occurrence of a Default or an Event of Default.
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES
6.1 REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants as follows to the Administrative Agent and
the Lenders and acknowledges and confirms that the Administrative Agent and the
Lenders are relying upon such representations and warranties:
(a) ORGANIZATION, ETC. Each Obligor is validly organized and existing
and in good standing under the laws of the jurisdiction of its
incorporation, creation or continuance, is duly qualified to do
business and is qualified as a foreign corporation, company or
other entity in each jurisdiction where the nature of its
business requires such qualification, except where the failure to
be so qualified would not reasonably be likely to have Material
Adverse Effect, and has full power and authority and holds all
requisite governmental licences, permits and other approvals to
enter into and perform its obligations under the Loan Documents
to which it is a party and except where failure to hold such
licenses, permits or approvals would not reasonably be likely to
have a Material Adverse Effect to own or hold under lease its
property and to conduct its business substantially as currently
conducted by it.
(b) VALIDITY, ETC. Each Obligor has duly executed and delivered each
Loan Document to which it is a party and each such Loan Document
constitutes a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms.
(c) DUE AUTHORIZATION, NON-CONTRAVENTION ETC. The execution, delivery
and performance by each Obligor of each Loan Document to which it
is a party are within its corporate powers, have been duly
authorized by all necessary corporate action by it, and do not
(i) contravene its Organic Documents;
(ii) contravene any Applicable Law or contractual restriction;
or
(iii) result in, or require the creation or imposition of, any
Lien on any of its properties.
(d) GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or
approval or other action by, and no consent from, notice to or
filing with, any Official Body or other Person is required for
the due execution, delivery or performance by any Obligor of any
Loan Document to which it is a party or in order to render any
such Loan Document legal, valid, binding or enforceable against
such Obligor.
(e) FINANCIAL STATEMENTS. The consolidated unaudited financial
statements of Celestica and its Subsidiaries as at September 30,
2002 fairly present the financial condition of Celestica and its
Subsidiaries as at such date and the results of their operations
for the fiscal quarter and nine month period then ended, in
accordance
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with GAAP consistently applied. Since September 30, 2002 (or, for
the purposes of Sections 4.2 and 4.3, if the Maturity Date has
been extended pursuant to Section 2.7, the date of the quarterly
or annual financial statements delivered most recently prior to
the date of the most recent of such extensions pursuant to
Section 7.1(a), there has been no Material Adverse Change;
(f) LITIGATION, LABOUR CONTROVERSIES, ETC. There is no pending or, to
the knowledge of Celestica and the Restricted Subsidiaries,
threatened litigation, action, proceeding, or labour controversy
affecting Celestica or any of the Restricted Subsidiaries, or any
of their respective properties, businesses, assets or revenues,
which would reasonably be likely to have a Material Adverse
Effect or purports to affect the legality, validity or
enforceability of any Loan Document.
(g) LICENCES, ETC. AND COMPLIANCE WITH LAWS. All material licences,
franchises, certificates, consents, rights, approvals,
authorizations, registrations, orders and permits required under
Applicable Law (other than Environmental Laws) to enable each of
the Borrowers and each Restricted Subsidiary to carry on their
respective businesses as now conducted by them and to own or
lease their respective properties have been duly obtained and are
currently subsisting. Each of the Borrowers and each Restricted
Subsidiary have complied in all material respects with the terms
and provisions presently required to be complied with by them in
all such material licences, franchises, certificates, consents,
rights, approvals, authorizations, registrations, orders and
permits and with Applicable Law (other than Environmental Laws)
and are not in violation of any of the respective provisions
thereof if such non-compliance or violation would reasonably be
likely to have a Material Adverse Effect.
(h) COMPLIANCE WITH ENVIRONMENTAL LAWS. Each of the Borrowers and the
Subsidiaries and all facilities and property now or formerly
owned, operated or leased by them:
(i) are and have been in compliance with all Environmental
Laws, including, without limitation, with respect to the
release, spill, leak, pumping, pouring, emptying,
injection, escape, leaching, dumping, spraying, burial,
abandonment, incineration, seepage, placement, emission,
deposit, issuance, discharge, transportation or disposal
("RELEASE") of any Hazardous Material in or over the water,
atmosphere or soil other than for non-compliance with
Environmental Laws which would not reasonably be likely to
have a Material Adverse Effect;
(ii) have no contingent liabilities in connection with any
Release or likely Release of Hazardous Materials and have
not Released or caused or permitted the Release of
Hazardous Materials, and have no knowledge of Releases by
others, at, on or under any property now or previously
owned, operated or leased by Celestica and its Material
Restricted Subsidiaries that, with respect to any of the
foregoing, singly or in the aggregate, would reasonably be
likely to have a Material Adverse Effect;
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(iii) have not received notice of and are not aware of any
pending or threatened claims, complaints, notices, orders,
directions, instructions or requests for information with
respect to any alleged violation of or potential liability
under any Environmental Law which would reasonably be
likely to have a Material Adverse Effect;
(iv) have been issued and are in compliance with all permits,
certificates, approvals, licences and other authorizations
relating to environmental matters and necessary or
desirable for the Business other than for any such
non-issuances and non-compliances which would not
reasonably be likely to have a Material Adverse Effect and
each such permit, certificate, approval, licence or other
authorization the absence of which would reasonably be
likely to have a Material Adverse Effect is in good
standing and there are no proceedings pending or, to the
knowledge of the Borrowers, threatened to revoke, amend or
limit in any material respect any such permit, certificate,
approval, licence or other authorization;
(v) have no underground storage tanks, active or, to the
knowledge of the Borrowers, abandoned, including petroleum
storage tanks, on or under any such property that, singly
or in the aggregate, would reasonably be likely to have a
Material Adverse Effect;
(vi) have not directly transported or directly arranged for the
transportation of any Hazardous Substances in violation of
Environmental Laws or to any location which would
reasonably be likely to lead to claims against them for any
remedial work, damage to the environment or natural
resources or personal injury, including claims under
CERCLA, which in any such case would reasonably be likely
to have a Material Adverse Effect;
(vii) have no polychlorinated biphenyls or friable asbestos
present at any such property that, singly or in the
aggregate, would reasonably be likely to have a Material
Adverse Effect;
(viii) have no conditions which exist at, on or under any such
property which, with or without the passage of time, or the
giving of notice or both, would give rise to liability
under any Environmental Laws which would reasonably be
likely to have a Material Adverse Effect; and
(ix) is not listed or proposed for listing on the National
Priorities List pursuant to CERCLA, on the CERCLIS or on
any similar state list of sites or Persons requiring
investigation or clean up where the liability imposition
and allocation regime provided for in the applicable state
Environmental Law is similar to CERCLA, including, without
limitation, the ability of governments and other parties to
recover costs from other responsible or potentially
responsible persons, except for any such listing or
proposed listing which would not reasonably be likely to
have a Material Adverse Effect.
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(i) ENCUMBRANCES. There are no Liens on any of the assets or
undertaking of the Borrowers or any Restricted Subsidiary other
than Permitted Encumbrances.
(j) NO DEFAULT OR EVENT OF DEFAULT. No Default or Event of Default
has occurred and is continuing.
(k) ACCURACY OF INFORMATION. All factual information heretofore or
contemporaneously furnished by or on behalf of Celestica in
writing to the Administrative Agent for the purposes of or in
connection with this Agreement is true and accurate in every
material respect on the date as of which such information is
dated or certified and as of the date of execution and delivery
of this Agreement, and such information is not incomplete by
omitting to state any material fact necessary to make such
information not misleading.
(l) NO ACTION FOR WINDING-UP OR BANKRUPTCY. There has been no
involuntary action taken against any of the Borrowers or any
Restricted Subsidiary for any such corporation's winding-up,
dissolution, liquidation, bankruptcy, receivership,
administration or similar or analogous events in respect of such
corporation or all or any material part of its assets or
revenues.
(m) TAXES. Each Borrower and each of its Subsidiaries have duly filed
on a timely basis all tax returns required to be filed by them
except where such failure to file would not reasonably be likely
to have a Material Adverse Effect and have paid all Taxes which
are due and payable by them, and all assessments and
re-assessments, and all other Taxes, governmental charges,
governmental royalties, penalties, interest and fines claimed
against them, other than those for which liability is being
contested by them in good faith by appropriate proceedings and
for which adequate provision has been made where required in
accordance with GAAP or in respect of which such failure to pay
would not reasonably be likely to have a Material Adverse Effect,
and all required instalment payments have been made in respect of
Taxes payable for the current period for which returns are not
yet required to be filed except where such failure to pay would
not reasonably be likely to have a Material Adverse Effect; there
are no agreements, waivers or other arrangements providing for an
extension of time with respect of the filing of any tax returns
by them or the payment of any Taxes except where such agreements,
waivers or other arrangements would not reasonably be likely to
have a Material Adverse Effect; there are no actions or
proceedings to be taken by any taxation authority of any
jurisdiction to enforce the payment of any Taxes by them other
than those which are being contested by them in good faith by
appropriate proceedings and which proceedings have been stayed
for the duration of such contestation.
(n) PENSION PLANS. Except as would not be reasonably likely to have a
Material Adverse Effect, (i) all Pension Plans are duly
established, registered, qualified, administered and invested in
compliance with the terms thereof, any applicable collective
agreements and Applicable Law; (ii) no events have occurred and
no action has been taken by any Person which would reasonably be
likely to result in the termination or partial termination of any
Pension Plan, whether by declaration
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of any Superintendent of Pensions or otherwise; (iii) none of the
Borrowers have withdrawn any assets held in respect of any
Pension Plan except as permitted under the terms thereof and
Applicable Laws; (iv) no Pension Plan has a "SOLVENCY DEFICIENCY"
or "GOING CONCERN UNFUNDED LIABILITY" as defined in the PENSION
BENEFITS ACT (
Ontario) and the regulations enacted thereunder, as
amended; (v) all contributions, premiums and other payments
required to be paid to or in respect of each Pension Plan have
been paid in a timely fashion in accordance with the terms
thereof and Applicable Law and no taxes, penalties or fees are
owing or exigible in respect of any Pension Plan; and (vi) no
actions, suits, claims, or proceedings are pending or, to the
knowledge of the Borrower, threatened in respect of any Pension
Plan or its assets, other than routine claims for benefits. For
the purposes of this section, "APPLICABLE LAW" shall include any
federal or provincial pension benefits legislation and the INCOME
TAX ACT (Canada).
(o) REGULATIONS U AND X. No Borrower is engaged in the business of
extending credit for the purpose of purchasing or carrying margin
stock. None of the proceeds from the Facility will be used for
the purpose of purchasing or carrying directly or indirectly
margin stock or for any other purpose that would constitute this
transaction a "PURPOSE CREDIT" within the meaning of Regulations
U and X of the Board of Governors of the Federal Reserves System,
as any of them may be amended from time to time.
(p) INVESTMENT COMPANY ACT. No Obligor is an "investment company"
within the meaning of the United States INVESTMENT COMPANY ACT OF
1940.
(q) PUBLIC UTILITY HOLDING COMPANY ACT. No Obligor is an "affiliate"
or a "subsidiary company" of a "public utility company" for a
"holding company" or an "affiliate" or a "subsidiary company" of
a "public utility company" as such terms are defined in the
United States PUBLIC UTILITY HOLDING COMPANY ACT OF 1935.
6.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The representations and warranties set out in this Article 6 and in any Loan
Document shall survive the execution and delivery of this Agreement and the
making of any Advances to the Borrowers, notwithstanding any investigations or
examinations which may be made by the Administrative Agent or any Lender or any
counsel to any of them.
6.3 DEEMED REPETITION OF REPRESENTATIONS AND WARRANTIES
Each of the representations set out in Section 6.1 shall be true and correct in
all material respects and shall be deemed to be given on the occurrence of the
Drawdown, Conversion or Rollover of an Advance, in each case by reference to the
facts and circumstances existing on the date of such Drawdown, Conversion or
Rollover.
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ARTICLE 7
COVENANTS
7.1 AFFIRMATIVE COVENANTS
Celestica covenants and agrees with each of the Lenders that, unless the
Majority Lenders otherwise consent in writing, so long as any amount payable
hereunder or under the Loan Documents is outstanding or any of the Lenders has
any Commitment hereunder:
(a) FINANCIAL REPORTING. Celestica shall deliver to the
Administrative Agent, with sufficient copies for distribution to
each of the Administrative Agent and each of the Lenders:
(i) within 60 days after the end of each of its fiscal quarters
in each fiscal year, commencing with the fiscal quarter
ending December 31, 2002, the unaudited financial
statements of Celestica on a consolidated basis, each
consisting of a balance sheet, statement of income and
statement (in the form customarily prepared by Celestica
for internal reporting purposes) of changes in financial
position as at the end of such fiscal quarter and for the
period commencing with the end of the previous fiscal
quarter and ending with the end of such fiscal quarter,
together with the figures for the year-to-date and setting
forth, in each case, in comparative form to the figures for
the corresponding fiscal quarter of the previous fiscal
year;
(ii) within 120 days after the end of each fiscal year of
Celestica, the audited consolidated financial statements of
Celestica for such year setting forth the corresponding
figures for the previous fiscal year in comparative form,
together with the report thereon of an independent auditor
of recognized national standing, each consisting of a
balance sheet, statement of income and statement of changes
in financial position;
(iii) within 60 days after the end of each fiscal quarter of
Celestica in each fiscal year, commencing with the fiscal
quarter ending December 31, 2002, an Officer's Certificate
of Celestica substantially in the form of Schedule D
stating that:
(A) Celestica is in compliance with the covenants set
forth in this Article 7 and that no Default or Event
of Default has occurred and is continuing (or
specifying such non-compliance or Default or Event of
Default and stating what action, if any, Celestica is
taking or is causing to be taken in connection
therewith) and providing a calculation of the ratios
referred to in Sections 7.3(a), (b) and (c), and a
statement as to the amount and calculation of
Tangible Net Worth, EBITDA, Interest Expense and
Gross Funded Debt, in each case as at the last day of
the relevant period; and
(B) Celestica has determined that the unconsolidated
assets of all Restricted Subsidiaries which are not
Material Restricted
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Subsidiaries do not, or will not, after giving effect
to the Guarantees delivered by the Restricted
Subsidiaries listed in a schedule thereto, exceed ten
per cent (10%) of the unconsolidated assets of the
Borrowers and the Restricted Subsidiaries on the date
referenced in the most recently delivered set of
financial statements delivered pursuant to Section
7.1(a)(ii);
(iv) in the event that Celestica delivers filings other than the
financial statements referred to in clauses (i) to (iii)
above to any securities commission, stock exchange or
similar regulatory authority, such filings concurrently
with the delivery of such filings to the securities
commission, stock exchange or similar regulatory authority;
and
(v) such other information respecting the condition or
operations, financial or otherwise, of Celestica or any
Subsidiary (other than an Unrestricted Subsidiary) as any
Lender through the Administrative Agent may from time to
time reasonably request, including without limitation,
particulars of Advances advanced or applied by either of
the Borrowers to or for the benefit of Celestica Italia
S.r.l or by any of Celestica's Restricted Subsidiaries to
or for the benefit of Celestica Italia S.r.l.
(b) CORPORATE STATUS. Subject to transactions undertaken in
compliance with Section 11.12, Celestica shall remain a
corporation duly incorporated and validly subsisting under the
laws of the Province of
Ontario or the federal laws of Canada and
each of the Restricted Subsidiaries shall remain validly
organized and existing and in good standing under the laws of its
jurisdiction of formation or continuance.
(c) MAINTENANCE OF BUSINESS AND PROPERTIES. Each of Celestica and
each Restricted Subsidiary shall, and shall cause each of its
Subsidiaries (except for Unrestricted Subsidiaries) to, continue
its business, maintain, preserve, protect and keep its properties
in good repair, working order and condition, reasonable wear and
tear excepted, and make necessary and proper repairs, renewals
and replacements so that its business carried on in connection
therewith may be properly conducted at all times unless Celestica
or such Restricted Subsidiary determines in good faith that the
continued maintenance of any of its properties is no longer
desirable.
(d) NOTICE OF EVENT OF DEFAULT. Celestica shall deliver to the
Administrative Agent, forthwith upon becoming aware of any
Default or Event of Default, a certificate of an officer of
Celestica specifying such Default or Event of Default together
with a statement of an officer of Celestica setting forth details
of such Default or Event of Default and the action which has
been, or is proposed to be, taken with respect thereto.
(e) OTHER NOTIFICATIONS. Celestica shall at any time upon request of
the Administrative Agent, acting reasonably, provide to the
Administrative Agent an up to date corporate chart showing
Celestica and all of its Subsidiaries and shall promptly notify
the Administrative Agent of:
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(i) any change in the name or organization of any of the
Borrowers or any Material Restricted Subsidiary and of any
change in the location of the registered office or
executive office of any of them;
(ii) the non-compliance with any Environmental Law or any
environmental claim, complaint, notice or order issued to
any of the Borrowers, or any of the Subsidiaries, or any
other environmental condition or event where such
non-compliance, condition or event would reasonably be
likely to have a Material Adverse Effect. As soon as
practicable thereafter, Celestica shall advise the
Administrative Agent as to the actions which the Borrowers
or any such Subsidiary intends to take in connection with
any such claim, complaint, notice or order; and
(iii) the institution of any steps by the Borrower or any other
Person to terminate any Pension Plan which would reasonably
be likely to have a Material Adverse Effect, failure to
make a required contribution to any Pension Plan if such
failure is sufficient to give rise to a Lien under Section
3.02(f) of ERISA, the taking of any action with respect to
a Pension Plan which could reasonably be expected to result
in the requirement that a Borrower furnish a bond or other
security to the PBGC or such Pension Plan, the occurrence
of any event with respect to any Pension Plan which would
reasonably be likely to have a Material Adverse Effect and
copies of all documentation relating thereto.
(f) COMPLIANCE WITH LAWS, ETC. Each of Celestica and the Restricted
Subsidiaries will, and will cause each of its Subsidiaries to,
comply in all material respects with Applicable Laws, such
compliance to include (without limitation) its qualification as a
foreign corporation in all jurisdictions in which such
qualification is legally required for the conduct of its
business.
(g) PAYMENT OF TAXES. The Borrowers shall, and the Borrowers shall
cause each of the Subsidiaries to, pay or cause to be paid, when
due, all Taxes including, property taxes, business taxes, social
security premiums, assessments and governmental charges or levies
imposed upon it or upon its income, sales, capital or profit or
any property belonging to it unless any such Tax, social security
premiums, assessment, charge or levy is contested by it in good
faith with adequate provision or reserve, where required by GAAP,
and to withhold and remit when due all payroll and withholding
taxes.
(h) INSURANCE. Each of Celestica and the Restricted Subsidiaries
will, and will cause each of its Subsidiaries (except for
Unrestricted Subsidiaries) to, maintain or cause to be maintained
insurance with responsible insurance companies with respect to
its properties and business against such casualties and
contingencies, of such types, and in such amounts as is customary
in the case for similar businesses operating in similar
geographic locations. Notwithstanding the foregoing, Celestica
and each of the Restricted Subsidiaries shall be permitted to
self-insure only where self-insurance is usual and customary for
the type of risk, and for companies in substantially the same
line of business and operating in the same
-54-
geographic location as Celestica or the Restricted Subsidiary, as
applicable, and where customary and usual reserves or provisions
are taken in respect of such self-insurance by Celestica or the
Restricted Subsidiary, as applicable. Upon request of the
Administrative Agent, Celestica will furnish to the
Administrative Agent for distribution to the Lenders at
reasonable intervals a certificate of an Authorized Officer of
Celestica setting forth the nature and extent of all insurance
maintained by Celestica and the Restricted Subsidiaries in
accordance with this Section which certificate shall specify the
risks for which Celestica or any Restricted Subsidiary have
self-insured and the amount of the provisions or reserves, if
any, held or made in respect of such self-insurance.
(i) BOOKS AND RECORDS. Celestica and each Restricted Subsidiary will,
and will cause each of its Subsidiaries to, keep books and
records which accurately reflect all of its business affairs and
transactions. Celestica will permit the Administrative Agent and
each Lender or any of their respective representatives, at
reasonable times and customary intervals during normal business
hours, to visit Celestica's offices and to discuss its financial
matters with Celestica's financial officers. Upon the occurrence
of and during the continuation of a Default, Celestica and each
Restricted Subsidiary shall permit the Administrative Agent and
each Lender or any of their respective representatives at any
time to visit all of its offices, to discuss its financial
matters with its officers and its independent chartered
accountant (and each of Celestica and each Restricted Subsidiary
hereby authorizes such independent chartered accountant to
discuss their financial matters with the Administrative Agent and
each Lender or its representatives whether or not any
representative of Celestica or the Restricted Subsidiary is
present) and to examine (and, at the expense of the Borrowers,
photocopy extracts from) any of its books or corporate records.
The Borrowers shall pay any fees of such independent chartered
accountant incurred in connection with the Administrative Agent's
or any Lender's exercise of its rights pursuant to this Section.
(j) CELESTICA INTERNATIONAL TO REMAIN SUBSIDIARY. Celestica
International (or its Successor Corporation within the meaning of
Section 11.12) shall remain a directly or indirectly wholly-owned
Subsidiary of Celestica.
(k) PUNCTUAL PAYMENT. Celestica will, and will cause each Obligor to
duly and punctually pay or cause to be paid all amounts due under
this Agreement and the other Loan Documents at the dates and
places, in the currencies and in the manner provided in this
Agreement and any other Loan Documents.
(l) RATINGS MAINTENANCE. Celestica shall maintain a credit rating
with the Approved Credit Rating Agencies and shall forthwith
notify the Administrative Agent in the event that any rating by
an Approved Credit Rating Agency is downgraded or in the event
that the rating of Celestica shall have been placed under review
by an Approved Credit Rating Agency.
(m) MATERIAL RESTRICTED SUBSIDIARY GUARANTEES.
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(i) Subject to clauses (ii) and (iii), Celestica shall:
(A) within 45 days of the acquisition or incorporation of
a Subsidiary which is a Restricted Subsidiary, whose
assets total greater than U.S. $150,000,000 on an
unconsolidated basis on the date of such acquisition
or incorporation; and
(B) upon the designation of a Restricted Subsidiary as a
Material Restricted Subsidiary on the Schedule to the
Officer's Certificate delivered pursuant to Section
7.1(a)(iii) within 45 days of such delivery of the
Officer's Certificate making such designation,
cause such Material Restricted Subsidiary to (I) authorize,
execute and deliver a Guarantee to the Administrative Agent
substantially in the form of Schedule G with such changes
as the Administrative Agent and the Material Restricted
Subsidiary may necessarily require on the advice of their
respective counsel to reflect local legal requirements;
(II) deliver to the Administrative Agent certified copies
of its Organic Documents and a resolution authorizing the
Guarantee, a certificate of its officers signing the
Guarantee and a certificate of status, good standing or
like certificate with respect to it issued by appropriate
government officials of its jurisdiction of incorporation;
and (III) cause to be delivered an opinion of counsel to
the newly acquired or incorporated Material Restricted
Subsidiary substantially in the form of Schedule K, with
only those changes which are satisfactory to the Lender's
Counsel.
(ii) In the event that any Material Restricted Subsidiary is not
a wholly-owned Subsidiary of Celestica, on the later of (i)
the date of execution of a Guarantee or (ii) the date of
acquisition by any Person which is not Celestica or a
Subsidiary of Celestica of any Share of such Material
Restricted Subsidiary, Celestica shall deliver an
acknowledgement addressed by such Person to the
Administrative Agent acknowledging the Guarantee executed
by such Material Restricted Subsidiary and the
enforceability thereof against the Material Restricted
Subsidiary to the full extent set out in the Guarantee
(subject to the same qualifications as set out in the
opinion of legal counsel to such Material Restricted
Subsidiary with respect to such Guarantee) notwithstanding
the ownership of Shares of the Material Restricted
Subsidiary by such Person and any agreement between such
Person and Celestica or any Subsidiary of Celestica.
(iii) The Borrowers and Guarantors shall, and the Borrowers shall
cause each of its Subsidiaries to, take all such steps and
do such things as may be necessary, in the opinion of the
Administrative Agent, to ensure the continuous
enforceability of each Guarantee granted by each Borrower
and each Material Restricted Subsidiary.
(n) ACCURACY OF INFORMATION. All factual information hereafter
furnished by or on behalf of Celestica in writing to the
Administrative Agent for the purposes of or in
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connection with this Agreement shall be true and accurate in
every material respect on the date as of which such information
is dated or certified and shall not be incomplete by the omission
to state any material fact necessary to make such information not
misleading.
7.2 NEGATIVE COVENANTS
Celestica covenants and agrees with each of the Lenders that, unless the
Majority Lenders otherwise consent in writing, so long as any amount payable
hereunder is outstanding or the Lenders shall have any Commitment hereunder:
(a) NO MERGER, AMALGAMATION, ETC. None of the Borrowers or any
Restricted Subsidiary shall, directly or indirectly, merge,
amalgamate or enter into any similar or other business
combination pursuant to statutory authority or otherwise with any
other Person except upon compliance with Section 11.12.
(b) RESTRICTION ON DISPOSITION OF ASSETS. None of the Borrowers or
any Restricted Subsidiary shall sell, assign, transfer, lease,
convey or otherwise dispose of any property, assets or
investments, (in each case a "SALE") other than:
(i) sales made in compliance with Section 11.12; or
(ii) sales of obsolete equipment in the ordinary course of
business; or
(iii) sales, assignments and transfers pursuant to a Permitted
Securitization Transaction; or
(iv) sale/leaseback transactions of:
(A) any real property owned by a Borrower or Restricted
Subsidiary; and
(B) any property or assets acquired by a Borrower or
Restricted Subsidiary, as the case may be, which is
completed within six months of the date on which such
property or assets were acquired, provided that any
Borrowing made to finance such acquisition shall be
repaid within two Banking Days of the completion of
such sale/leaseback transaction; or
(v) sales of Shares of any Unrestricted Subsidiary; or
(vi) sales of assets and property, including inventory, in the
ordinary course of business; or
(vii) sales of any fixed assets together with associated
intellectual property not otherwise permitted in clauses
(i) to (vi) above, subject to an aggregate limit of sales
under this clause (vii) in any fiscal year by the Borrowers
and Restricted Subsidiaries in an amount equal to 10% of
the aggregate net book value of the fixed assets plus 10%
of the aggregate net book
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value of intellectual property of Celestica on a
consolidated basis (the "DISPOSITION ALLOWANCE") and
provided that, in any fiscal year in which the Borrowers
and Restricted Subsidiaries do not sell fixed assets and
associated intellectual property under this clause (vii)
having aggregate net book values totalling the disposition
allowance, the Borrowers and Restricted Subsidiaries may
carry forward into the following fiscal years the unused
disposition allowance, and further provided that none of
the Borrowers or Restricted Subsidiaries shall sell any
intellectual property under this clause (vii) unless such
sale is incidental to a sale of fixed assets; or
(viii) sales of assets, property or investments from a Borrower
or Restricted Subsidiary to another Borrower or Restricted
Subsidiary provided that no Borrower or Restricted
Subsidiary shall so sell assets, property or investments
during the occurrence and continuance of a Default or where
such sale, alone or as part of a series of previously or
concurrently occurring sales, would reasonably be likely to
have a Material Adverse Effect.
(c) RESTRICTION ON CERTAIN INTER-COMPANY TRANSACTIONS. Except as
otherwise permitted by this Section 7.2, none of the Borrowers or
any Restricted Subsidiary shall enter into any agreement or
complete any transaction with any other Borrower or any
Restricted Subsidiary during the occurrence and continuance of a
Default or where such agreement or transaction, alone or as part
of a series of previously or concurrently occurring agreements or
transactions, would reasonably be likely to have a Material
Adverse Effect.
(d) NEGATIVE PLEDGE/PARI PASSU RANKING. None of the Borrowers or any
of the Restricted Subsidiaries shall create, incur, assume or
permit to exist any Lien, other than Permitted Encumbrances, on
any of its property, undertaking or assets now owned or hereafter
acquired. Each Obligor's monetary Obligations shall rank at least
pari passu with all other unsecured Indebtedness of such Obligor
and no Obligor shall, or shall agree with any other Person to,
pay any other Indebtedness in priority to payment of all monetary
Obligations as and when due.
(e) RESTRICTION ON NON-ARM'S LENGTH TRANSACTIONS. The Borrowers shall
not, and shall not permit any Restricted Subsidiary to, enter
into any transaction or agreement with any Person which is not at
Arm's Length with the Borrowers or such Restricted Subsidiary
(other than other Borrowers, Restricted Subsidiaries or
Unrestricted Subsidiaries) unless,
(i) such transaction or agreement is in the ordinary course of
business and is on terms no less favourable to the
Borrowers or such Restricted Subsidiary as would be
obtainable in a comparable transaction with a Person which
is at Arm's Length with the Borrower or such Restricted
Subsidiary, and
(ii) such transaction or agreement complies with the terms of
Section 7.2(c).
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(f) RESTRICTION ON CHANGE OF BUSINESS. None of the Borrowers or the
Restricted Subsidiaries shall, either directly or indirectly,
enter into any business other than the Business without the prior
written consent of the Majority Lenders.
(g) NO CHANGE IN ACCOUNTING TREATMENT OR REPORTING PRACTICES. Subject
to the provisions of Section 1.7, none of the Borrowers nor any
Restricted Subsidiary shall make any material change in its
accounting or reporting or financial reporting practices, except
as consistent with GAAP or Applicable Law, which changes shall be
disclosed to the Lenders.
(h) RESTRICTIONS ON TRANSACTIONS WITH UNRESTRICTED SUBSIDIARIES. No
Borrower shall, or shall permit any Restricted Subsidiary to,
(i) sell assets or lend monies to any Unrestricted Subsidiary
unless such sale is permitted pursuant to Section
7.2(b)(vi) and such sale or loan is in the ordinary course
of business and is on terms no less favourable to such
Borrower or such Restricted Subsidiary as would be
obtainable in a comparable transaction with a Person which
is at Arm's Length with the Borrower or such Restricted
Subsidiary; or
(ii) provide financial assistance by means of a guarantee to an
Unrestricted Subsidiary unless the financial assistance is
in the form of a guarantee granted by the immediate parent
of such Unrestricted Subsidiary, where such guarantee is
(A) made solely for the purpose of facilitating a pledge by
the guarantor of Shares of such Unrestricted Subsidiary;
and (B) the recourse thereunder is limited to the Shares of
the Unrestricted Subsidiary; and (C) a pledge of the Shares
of the Unrestricted Subsidiary.
(i) RESTRICTIONS ON TRANSACTIONS WITH CELESTICA ITALIA S.R.L. No
Borrower shall, or shall permit any Restricted Subsidiary to,
(i) invest Advances in, contribute equity to, or otherwise
apply Advances for the benefit of Celestica Italia S.r.l.
except, subject to Section 7.2(i)(ii), by loaning such
Advances to Celestica Italia S.r.l.; and
(ii) lend Advances to Celestica Italia S.r.l where the amount of
Advances that has been advanced to or for the benefit of
Celestica Italia S.r.l. outstanding at such time would
exceed U.S.$200,000,000.
7.3 FINANCIAL COVENANTS
(a) MINIMUM TANGIBLE NET WORTH. Celestica shall maintain, at all
times, a minimum Tangible Net Worth in an amount that shall not
be less than an amount equal to the sum of U.S. $1,750,000,000,
plus 50% of cumulative annual positive Net Income commencing with
the fiscal year ending December 31, 2000 and in each subsequent
fiscal year.
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(b) MINIMUM EBITDA:INTEREST EXPENSE RATIO. Celestica shall maintain
an EBITDA:Interest Expense ratio, calculated on a rolling four
quarter basis of at least 3.5:1.0.
(c) MAXIMUM GROSS FUNDED DEBT: EBITDA RATIO. Celestica shall maintain
a Gross Funded Debt: EBITDA ratio calculated on a rolling four
quarter basis of not more than 3.25:1.0.
(d) CALCULATION OF FINANCIAL RATIOS. For the purposes of Sections
7.3(a), (b) and (c), all of the calculations shall be made on a
consolidated basis in accordance with the provisions of Sections
1.7 and 1.8.
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ARTICLE 8
DEFAULT AND ACCELERATION
8.1 EVENTS OF DEFAULT
The occurrence of any one or more of the following events (each such event and
the expiry of the cure period, if any, provided in connection therewith, being
herein referred to as an "EVENT OF DEFAULT") shall constitute a default under
this Agreement:
(a) if a Borrower shall default in (i) the payment when due of any
principal of any Advance; (ii) the payment when due of any
interest on any Advance (and such default shall continue
unremedied, in the case of interest, for a period of three (3)
days); or (iii) the payment when due of any fee or any other
Obligation (and any of such defaults described in item (iii)
shall continue unremedied for a period of five (5) days);
(b) any representation or warranty made or deemed to be made
hereunder or in any other Loan Document or any other writing or
certificate furnished by on behalf of an Obligor to the
Administrative Agent for the purposes of or in connection with
this Agreement or any such other Loan Document is or shall be
incorrect when made in any material respect;
(c) any Obligor shall default in the service or performance of any
agreement, covenant or condition contained herein or in any other
Loan Document (other than as set forth above) and such failure
shall remain unremedied for a period of thirty (30) days after
notice in writing has been given by the Administrative Agent to
Celestica;
(d) if, on, prior to or in connection with any Indebtedness having a
principal amount, individually or in the aggregate, in excess of
U.S. $50,000,000 becoming Acquired Indebtedness, (i) a default
shall have occurred in the payment when due, whether by
acceleration or otherwise, of any such Acquired Indebtedness, or
(ii) a default shall occur or shall have occurred in the
performance or observance of any obligation or condition with
respect to such Indebtedness or as a result of such Indebtedness
becoming Acquired Indebtedness, if the effect of such default is
to accelerate the maturity of such Acquired Indebtedness or such
default shall continue unremedied and unwaived for any applicable
grace period of time sufficient to permit the holder or holders
of such Acquired Indebtedness, or any trustee or agent for such
holders, to have the right to cause such Acquired Indebtedness to
become due and payable prior to its expressed maturity; provided
that where such Acquired Indebtedness has a principal amount
individually or in the aggregate, of up to and including U.S.
$100,000,000, a default described in clauses (i) or (ii) shall
only be an Event of Default under this Agreement if unremedied
for 60 days from the date such Indebtedness becomes Acquired
Indebtedness;
(e) a default shall occur in the payment when due, whether by
acceleration or otherwise, of any Indebtedness (other than as set
forth in (a) and (d) above) of any
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Borrower or any Restricted Subsidiary having a principal amount,
individually or in the aggregate, in excess of U.S.$ 50,000,000,
or a default shall occur in the performance or observance of any
obligation or condition with respect to any such Indebtedness if
the effect of such default is to accelerate the maturity of any
such Indebtedness or such default shall continue unremedied and
unwaived for any applicable grace period of time sufficient to
permit the holder or holders of such Indebtedness, or any trustee
or agent for such holders, to have the right to cause such
Indebtedness to become due and payable prior to its expressed
maturity;
(f) any judgment or order for the payment of money in excess of U.S.$
25,000,000, which is not covered by insurance, shall be rendered
against any Borrower or any Restricted Subsidiary and either:
(i) enforcement proceedings shall have been commenced by any
creditor upon such judgment or order; or
(ii) there shall be any period of 30 consecutive days during
which a stay of enforcement of such judgment or order, by
reason of a pending appeal or otherwise, shall not be in
effect and such judgment shall not have been paid or
otherwise satisfied;
(g) any Borrower or any Restricted Subsidiary shall:
(i) become (or be deemed by any Applicable Law to be) insolvent
or generally fail to pay, or admit in writing its inability
or unwillingness to pay its debts as they generally become
due;
(ii) apply for, consent to, or acquiesce in, the appointment of
a trustee, receiver, receiver and manager, liquidator,
sequestrator, administrator or other custodian in
connection with the insolvency of a Borrower or a
Restricted Subsidiary or any property of any thereof except
as permitted under Section 11.12, or make a general
assignment for the benefit of creditors;
(iii) in the absence of an application referred to in Section
8.1(g)(ii), consent or acquiescence, permit or suffer to
exist the appointment of a trustee, receiver, receiver and
manager, liquidator, sequestrator, administrator or other
custodian for a Borrower or a Restricted Subsidiary or for
a substantial part of the property of any of them except as
permitted under Section 11.12, and such trustee, receiver,
receiver and manager, liquidator, sequestrator,
administrator or other custodian shall not be discharged
within 60 days, provided that the Borrowers hereby
expressly authorize the Administrative Agent and each
Lender to appear in any court conducting any relevant
proceeding relating to any of them or any Restricted
Subsidiary during such 60-day period to preserve, protect
and defend their rights under the Loan Documents;
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(iv) permit or suffer to exist the commencement of any
bankruptcy, reorganization, debt arrangement,
administration or other case or proceeding under any
bankruptcy, insolvency or similar law, or any dissolution,
winding up, administration or liquidation proceeding, in
respect of any Borrower or any Restricted Subsidiary
(except as permitted under Section 11.12), and, if any such
case or proceeding is not commenced by such Borrower or
such Restricted Subsidiary, such case or proceeding shall
be consented to or acquiesced in by such Borrower or such
Restricted Subsidiary or shall result in the entry of an
order for relief or shall remain for 60 days undismissed,
provided that each Borrower and each Restricted Subsidiary
is hereby deemed to expressly authorize the Administrative
Agent and each Lender to appear in any court conducting any
such case or proceeding relating to any of them or any
Restricted Subsidiary during such 60-day period to
preserve, protect and defend their rights under the Loan
Documents; or
(v) take any corporate action authorizing, or in furtherance
of, any of the matters referred to in clauses (ii), (iii)
or (iv) above;
(h) Onex Corporation shall cease to control Celestica unless the
shares of Celestica become widely held such that no one Person or
group of Persons acting jointly or in concert (within the meaning
of Part XX of the SECURITIES ACT (
Ontario)) controls Celestica,
provided that any Person or group of Persons acting jointly or in
concert which owns or controls securities of Celestica to which
are attached more than 20% of the votes that may be cast to elect
the directors of Celestica shall, in the absence of evidence
satisfactory to the Administrative Agent, acting reasonably, be
deemed to control Celestica;
(i) any Loan Document shall (except in accordance with its terms), in
whole or in part, terminate, cease to be effective or cease to be
the legally valid, binding and enforceable obligation of any
Obligor that is a party thereto; or any Obligor shall, directly
or indirectly, contest in any manner such effectiveness,
validity, binding nature or enforceability of any Loan Document;
or
(j) any Borrower or any governmental authority declares, orders or
proposes to order a full or partial wind up of any Pension Plan
which, in either case, would reasonably be likely to have a
Material Adverse Effect or if any of the following events shall
occur with respect to a Pension Plan:
(i) the institution of any step by a Borrower, any member of
its Controlled Group or any other Person to terminate a
Pension Plan if, as a result of such termination, the
Borrowers or any such member of its Controlled Group would
reasonably be likely to be required to make a contribution
to such Pension Plan or could reasonably expect to incur a
liability or obligation to such Pension Plan which, in
either case, would reasonably be likely to have a Material
Adverse Effect; or
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(ii) a contribution failure occurs with respect to any Pension
Plan sufficient to give rise to a Lien under Section 302(f)
of ERISA.
8.2 ACCELERATION
Upon the occurrence of an Event of Default (other than as set forth in Section
8.1(g) or (h)) and at any time thereafter while an Event of Default is
continuing, the Administrative Agent may, in consultation with the Lenders (and,
if so instructed by the Majority Lenders, shall) by written notice to the
Borrowers:
(a) declare the Advances made to the Borrowers to be immediately due
and payable (whereupon the same shall become so payable together
with accrued interest thereon and any other sums then owed by the
Borrowers hereunder or under any other Loan Document) or declare
such Advances to be due and payable on demand of the
Administrative Agent; and/or
(b) if not theretofore terminated, declare that all of the
Commitments shall be cancelled, whereupon the same shall be
cancelled and the Commitment of each Lender shall be reduced to
zero.
If, pursuant to this Section 8.2, the Administrative Agent declares any Advances
made to the Borrowers to be due and payable on demand, then, and at any time
thereafter, the Administrative Agent may (and, if so instructed by the Majority
Lenders, shall) by written notice to the Borrowers call for repayment of such
Advances on such date or dates as it may specify in such notice (whereupon the
same shall become due and payable on such date together with accrued interest
thereon and any other sums then owed by the Borrowers hereunder or under any
other Loan Document and the provisions of Section 8.4 shall apply) or withdraw
its declaration with effect from such date as it may specify in such notice.
Upon the occurrence of an Event of Default set forth in Section 8.1(g) or (h),
the Commitments shall automatically terminate and the outstanding principal
amount of all outstanding Advances (together with accrued interest thereon and
any other sums then owed by the Borrowers hereunder or under any other Loan
Document and the provisions of Section 8.4 shall apply) shall automatically be
and become immediately due and payable, without notice or demand.
8.3 REMEDIES CUMULATIVE AND WAIVERS
It is expressly understood and agreed that the rights and remedies of the
Lenders, the Administrative Agent and each of them hereunder or under any other
Loan Document or other instrument executed pursuant to this Agreement are
cumulative and are in addition to and not in substitution for any rights or
remedies provided by law or by equity; and any single or partial exercise by the
Lenders, the Administrative Agent or any of them of any right or remedy for a
default or breach of any term, covenant, condition or agreement contained in
this Agreement or any other Loan Document shall not be deemed to be a waiver of
or to alter, affect or prejudice any other right or remedy or other rights or
remedies to which the Lenders, the Administrative Agent or any of them may be
lawfully entitled for such default or breach. Any waiver by the Lenders, the
Administrative Agent or any of them of the strict observance, performance or
compliance with any term, covenant, condition or other matter contained herein
or in any other
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Loan Document and any indulgence granted, either expressly or by course of
conduct, by the Lenders, the Administrative Agent or any of them shall be
effective only in the specific instance and for the purpose for which it was
given and shall be deemed not to be a waiver of any rights and remedies of the
Lenders, the Administrative Agent or any of them under this Agreement or any
other Loan Document as a result of any other default or breach hereunder or
thereunder.
8.4 SUSPENSION OF LENDERS' OBLIGATIONS
Without prejudice to the rights which arise out of this Agreement or by law, the
occurrence of an Event of Default shall, while such Event of Default shall be
continuing, relieve the Lenders of all obligations to make any Advances
hereunder (whether or not any Drawdown Notice in respect of any such Advance
shall have been received by the Administrative Agent prior to the occurrence of
an Event of Default) or to accept or comply with any Drawdown Notice, Conversion
Notice or Rollover Notice.
8.5 APPLICATION OF PAYMENTS AFTER AN EVENT OF DEFAULT
If any Event of Default shall occur and be continuing, all payments made by the
Borrowers hereunder or payments made pursuant to any of the provisions of any of
the Guarantees shall be applied in the following order:
(a) to amounts due hereunder as costs and expenses of the
Administrative Agent;
(b) to amounts due hereunder as costs and expenses of the Lenders;
(c) to amounts due hereunder as fees;
(d) to any other amounts (other than amounts in respect of interest
or principal) due hereunder;
(e) to amounts due hereunder as interest; and
(f) to amounts due hereunder as principal.
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ARTICLE 9
THE ADMINISTRATIVE AGENT AND
ADMINISTRATION OF THE FACILITY
9.1 AUTHORIZATION OF ACTION
Each Lender hereby irrevocably appoints and authorizes the Administrative Agent
to be its Agent in its name and on its behalf and to exercise such rights or
powers granted to the Administrative Agent under this Agreement and the Loan
Documents to the extent specifically provided herein and therein and on the
terms hereof and thereof, together with such rights, powers and discretions as
are reasonably incidental thereto. As to any matters not expressly provided for
by this Agreement or the Loan Documents, the Administrative Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Majority Lenders, and such
instructions shall be binding upon all Lenders; provided, however, that no Agent
shall be required to take any action which exposes Agent to liability in such
capacity, which could result in the Administrative Agent incurring any costs and
expenses or which is contrary to this Agreement or Applicable Law.
9.2 PROCEDURE FOR MAKING ADVANCES
(a) The Administrative Agent shall make Advances available to the
relevant Borrowers as required hereunder by debiting the account
of the Administrative Agent to which the Lenders' Main Facility
Rateable Portions of such Advances have been credited in
accordance with Section 9.2(b) (or causing such account to be
debited) and, in the absence of other arrangements agreed to by
the Administrative Agent and Celestica in writing, by
transferring (or causing to be transferred) like funds in
accordance with the instructions of the Borrower as set forth in
the Drawdown Notice in respect of each Advance; provided that the
obligation of the Administrative Agent hereunder shall be limited
to taking such steps as are commercially reasonable to implement
such instructions, which steps once taken shall constitute
conclusive and binding evidence that such funds were advanced
hereunder in accordance with the provisions relating thereto and
the Administrative Agent shall not be liable for any damages,
claims or costs which may be suffered by the Borrower and
occasioned by the failure of such Advance to reach the designated
destination, except to the extent such damages, claims or costs
are the result of the gross negligence or wilful misconduct of
the Administrative Agent.
(b) Unless the Administrative Agent has been notified by a Lender on
the Banking Day prior to the Drawdown Date requested by a
Borrower that such Lender will not make available to the
Administrative Agent its Main Facility Rateable Portion of such
Advance, the Administrative Agent may assume that such Lender has
made such portion of the Advance available to the Administrative
Agent on the Drawdown Date in accordance with the provisions
hereof and the Administrative Agent may, in reliance upon such
assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent such Lender shall not
have so made its Main Facility Rateable Portion of the Advance
available to the
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Administrative Agent, then such Lender shall pay to the
Administrative Agent forthwith on demand such Lender's Main
Facility Rateable Portion of the Advance and all reasonable costs
and expenses incurred by the Administrative Agent in connection
therewith together with interest thereon (at the rate payable
thereunder by the Borrower in respect of such Advance) for each
day from the date such amount is made available to the Borrower
until the date such amount is paid to the Administrative Agent;
provided, however, that notwithstanding such obligation, if such
Lender fails to so pay, the Borrower covenants and agrees that
without prejudice to any rights such Borrower may have against
such Lender, it shall reimburse such amount to the Administrative
Agent forthwith after demand therefor by the Administrative
Agent. The amount payable to the Administrative Agent pursuant
hereto shall be as set forth in a certificate delivered by the
Administrative Agent to such Lender and such Borrower (which
certificate shall contain reasonable details of how the amount
payable is calculated) and shall be conclusive and binding, for
all purposes, in the absence of manifest error. If such Lender
makes the payment to the Administrative Agent required herein,
such Lender shall be considered to have made its Main Facility
Rateable Portion of the Advance for purposes of this Agreement
and the Administrative Agent shall make appropriate entries in
the books of account maintained by the Administrative Agent.
(c) The failure of any Lender to make its Main Facility Rateable
Portion of any Advance shall not relieve any other Lender of its
obligation, if any, hereunder to make its Main Facility Rateable
Portion of such Advance on the Drawdown Date, but no Lender shall
be responsible for the failure of any other Lender to make the
Main Facility Rateable Portion of the Advance to be made by such
other Lender on the date of any Advance.
(d) Where a Drawdown under the Facility and a repayment of an Advance
under the Facility are to occur on the same day, the
Administrative Agent shall not make available to the relevant
Borrower the amount of the Advance to be drawn down until the
Administrative Agent is satisfied that it has received
irrevocable and irreversible payment of the amount to be prepaid
or repaid. Notwithstanding the foregoing, in the absence of gross
negligence or wilful misconduct on the part of the Administrative
Agent, the risk of non-receipt of the amount to be repaid is that
of the Lenders and not of the Administrative Agent.
(e) This Section 9.2 shall not apply to Swing Line Advances.
9.3 REMITTANCE OF PAYMENTS
Forthwith after receipt of any repayment of principal or payment of interest or
fees pursuant to any provision of this Agreement, the Administrative Agent which
has received such repayment or payment shall remit to each Lender its Main
Facility Rateable Portion thereof; provided, however, that the Administrative
Agent shall be entitled to set off against and deduct from any amount payable to
a Lender any outstanding amounts payable by such Lender to the Administrative
Agent pursuant to Section 9.2(b). Forthwith after receipt of any payment of
Facility Fees pursuant to Section 2.11, the Administrative Agent shall remit to
each Lender its
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Main Facility Rateable Portion of such payment. If the Administrative Agent, on
the assumption that it will receive on any particular date a payment of
principal, interest or fees hereunder, remits such payment to the Lenders and
the Borrowers fail to make such payment, each of the Lenders agrees to repay to
the Administrative Agent forthwith on demand the amount received by it together
with all reasonable costs and expenses incurred by the Administrative Agent in
connection therewith to the extent not reimbursed by the Borrower and interest
thereon at the rate and calculated in the manner applicable to the Advance in
respect of which such payment was made for each day from the date such amount is
remitted to the Lenders, the exact amount of the repayment required to be made
by the Lenders pursuant hereto to be as set forth in a certificate delivered by
the Administrative Agent to each Lender, which certificate shall be conclusive
and binding for all purposes in the absence of manifest error. The
Administrative Agent shall make appropriate entries in the register maintained
by it to reflect the foregoing.
9.4 REDISTRIBUTION OF PAYMENT
(a) If any Lender receives or recovers (whether by payment or
combination of accounts or otherwise) an amount owed to it by a
Borrower under this Agreement otherwise than through the
Administrative Agent, then such Lender shall, within two Banking
Days following such receipt or recovery, notify the
Administrative Agent (who shall in turn notify the other Lenders)
of such fact.
(b) Subject to the other terms and conditions of this Agreement, if
at any time the proportion which any Lender (a "RECOVERING
LENDER") has received or recovered (whether by payment or
combination of accounts or otherwise) in respect of its portion
of any payment to be made under this Agreement by a Borrower for
the account of such Recovering Lender and one or more other
Lenders is greater (the amount of the excess being herein called
the "EXCESS AMOUNT") than the proportion thereof received or
recovered by the Lender or Lenders receiving or recovering the
smallest proportion thereof, then:
(i) the Recovering Lender shall, within two Banking Days
following such receipt or recovery, pay to the
Administrative Agent an amount equal to the excess amount;
and
(ii) the Administrative Agent shall treat the amount received by
it from the Recovering Lender pursuant to paragraph (i)
above as if such amount had been received by it from such
Borrower pursuant to its obligations under this Agreement
and shall pay the same to the Persons entitled thereto
(including such Recovering Lender) PRO RATA to their
respective entitlements thereto in which event, for all
purposes in connection herewith, the Recovering Lender
shall be deemed only to have received or recovered from
such Borrower that portion of the excess amount which is
actually paid to the Recovering Lender by the
Administrative Agent pursuant to this Section 9.4(b)(ii).
(c) If a Lender that has paid an excess amount to the Administrative
Agent in accordance with Section 9.4(b)(i) is required to refund
the whole (or a portion) of such excess amount to the Borrower,
then each of the other Lenders shall pay to
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the Administrative Agent for the account of that Lender the whole
(or that proportion) of the amount received by it as a result of
the distribution in respect of that excess amount made by the
Administrative Agent pursuant to Section 9.4(b)(ii).
9.5 DUTIES AND OBLIGATIONS
(a) Neither the Administrative Agent nor any of its directors,
officers, agents or employees (and, for purposes hereof, the
Administrative Agent shall be deemed to be contracting for and on
behalf of such Persons) shall be liable for any action taken or
omitted to be taken by it or them under or in connection with
this Agreement except for its or their own gross negligence or
wilful misconduct. Without limiting the generality of the
foregoing, the Administrative Agent:
(i) may assume that there has been no assignment or transfer by
any means by any Lender of its rights hereunder, unless and
until the Administrative Agent has received a duly
completed and executed assignment in form satisfactory to
it;
(ii) may consult with legal counsel (including the Lenders'
Counsel), independent public accountants and other experts
of reputable standing selected by it and shall not be
liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel,
accountants or experts;
(iii) shall incur no liability under or in respect of this
Agreement by acting upon any notice, consent, certificate
or other instrument or writing believed by it to be genuine
and signed or sent by the proper party or parties or by
acting upon any representation or warranty of the Borrowers
or any Guarantor made or deemed to be made hereunder;
(iv) may assume that no Event of Default has occurred and is
continuing unless an appropriate officer charged with the
administration of this Agreement has actual notice or
knowledge to the contrary;
(v) may rely as to any matters of fact which might reasonably
be expected to be within the knowledge of any Person upon a
certificate signed by or on behalf of such Person; and
(vi) shall incur no liability for its failure to distribute to
any Lender the financial statements or other information
provided to the Administrative Agent by the Borrowers or
any Guarantor.
Further, the Administrative Agent (a) shall not have any duty to
ascertain or to enquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement on
the part of any of the Borrowers or any Guarantor or to inspect
the property (including the books and records) of any of the
Borrowers or any Guarantor and (b) shall not be responsible to
any Lender for
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the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any
instrument or document furnished pursuant hereto.
(b) The Administrative Agent makes no warranty or representation to
any Lender nor shall the Administrative Agent be responsible to
any Lender for the accuracy or completeness of the data made
available to any of the Lenders in connection with the
negotiation of this Agreement, or for any statements, warranties
or representations (whether written or oral) made in or in
connection with this Agreement.
(c) Except as otherwise provided for herein, the Administrative Agent
may, but is not obligated to, seek the approval of the Majority
Lenders to any consents required to be given by the
Administrative Agent hereunder.
9.6 PROMPT NOTICE TO THE LENDERS
Subject to the provisions of Section 9.5(a)(vi), the Administrative Agent agrees
to provide to the Lenders, copies where appropriate, of all information, notices
and reports required to be given to the Administrative Agent by the Borrowers
and the Guarantors hereunder or pursuant to any other Loan Document, promptly
upon receipt of same, excepting therefrom information and notices relating
solely to the role of the Administrative Agent hereunder.
9.7 ADMINISTRATIVE AGENT'S AUTHORITY
With respect to its Commitment and the Advances made by it as a Lender, the
Administrative Agent shall have the same rights and powers under this Agreement
as any other Lender and may exercise the same as though they were not Agents.
The Administrative Agent may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrowers and the Subsidiaries or any
corporation or other entity owned or controlled by any of them and any Person
which may do business with any of them, all as if the Administrative Agent was
not the Administrative Agent hereunder and without any duties to account
therefor to the Lenders.
9.8 LENDER'S INDEPENDENT CREDIT DECISION
It is understood and agreed by each Lender that it has itself been, and will
continue to be, solely responsible for making its own independent appraisal of
and investigations into the financial condition, creditworthiness, condition,
affairs, status and nature of the Borrowers and its Subsidiaries. Accordingly,
each Lender confirms with the Administrative Agent that it has not relied, and
will not hereafter rely, on the Administrative Agent (i) to check or enquire on
its behalf into the adequacy, accuracy or completeness of any information
provided by the Borrowers or any other Person under or in connection with this
Agreement, the other Loan Documents or the transactions herein or therein
contemplated (whether or not such information has been or is hereafter
distributed to such Lender by the Administrative Agent), or (ii) to assess or
keep under review on its behalf the financial condition, creditworthiness,
condition, affairs, status or nature of the Borrowers or any Subsidiary. Each
Lender acknowledges that a copy of this Agreement has been made available to it
for review and each Lender acknowledges that it is satisfied with the form and
substance of this Agreement.
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9.9 INDEMNIFICATION
Each Lender hereby agrees to indemnify the Administrative Agent (to the extent
not reimbursed by the Borrowers) in its Global Rateable Portion, from and
against any and all liabilities, obligations, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the
Administrative Agent (in its capacity as agent for the Lenders) in any way
relating to or arising out of this Agreement or any other Loan Documents or any
action taken or admitted by the Administrative Agent under or in respect of this
Agreement or any other Loan Documents; provided that no Lender shall be liable
for any portion of such liabilities, obligations, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's gross negligence or wilful misconduct. Without limiting
the generality of the foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand in the proportion specified herein in
respect of any out-of-pocket expenses (including counsel fees) incurred by the
Administrative Agent in connection with the preservation of any rights of Agents
or the Lenders under, or the enforcement of, or legal advice in respect of the
rights or responsibilities under, this Agreement or any other Loan Documents, to
the extent that the Administrative Agent is not reimbursed for such expenses by
the Borrowers.
9.10 SUCCESSOR AGENT
The Administrative Agent may, as hereinafter provided, resign at any time by
giving not less than 30 days' written notice thereof to the Lenders and the
Borrowers. The Administrative Agent may, as hereinafter provided, be removed at
any time on not less than 30 days' written notice thereof by the Majority
Lenders provided that the Majority Lenders have designated a successor who is
prepared to act hereunder and which is acceptable to Celestica, acting
reasonably. Upon any such resignation or removal, the Majority Lenders shall
have the right to appoint a successor agent (the "SUCCESSOR AGENT") which shall
be a Lender and which shall be acceptable to the Borrowers, acting reasonably.
Upon the acceptance of any appointment hereunder by a Successor Agent, such
Successor Agent shall thereupon become Administrative Agent hereunder and shall
succeed to and become vested with all the rights, powers, privileges and duties
of Scotiabank and Scotiabank shall thereupon be discharged from its further
duties and obligations as Administrative Agent under this Agreement. After any
resignation or removal of Scotiabank under this Section 9.10, the provisions of
this Article 9 shall continue to enure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent hereunder.
9.11 TAKING AND ENFORCEMENT OF REMEDIES
(a) Each of the Lenders hereby acknowledges that, to the extent
permitted by Applicable Law, the remedies provided hereunder to
the Lenders are for the benefit of the Lenders collectively and
acting together and not severally and further acknowledges that
its rights hereunder are to be exercised not severally, but
collectively by the Administrative Agent upon the decision of the
Lenders regardless of whether declaration or acceleration was
made pursuant to Section 8.2; accordingly, notwithstanding any of
the provisions contained herein, each of the Lenders hereby
covenants and agrees that it shall not be entitled to take any
action with respect to the Facility, including, without
limitation, any declaration
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or acceleration under Section 8.2, but that any such action shall
be taken only by the Administrative Agent with the prior written
consent of the Lenders or the Majority Lenders, as applicable,
provided that, notwithstanding the foregoing:
(i) in the absence of instructions from the Lenders or from the
Majority Lenders, as applicable, and where in the sole
opinion of the Administrative Agent the exigencies of the
situation warrant such action, the Administrative Agent may
without notice to or consent of the Lenders take such
action on behalf of the Lenders as it deems appropriate or
desirable in the interest of the Lenders; and
(ii) the commencement of litigation before any court shall be
made in the name of each Lender individually unless the
laws of the jurisdiction of such court permit such
litigation to be commenced in the name of the
Administrative Agent on behalf of the Lenders (whether
pursuant to a specific power of attorney in favour of the
Administrative Agent or otherwise) and the Administrative
Agent agrees to commence such litigation in its name;
each of the Lenders hereby further covenants and agrees that upon
any such written consent being given by the Lenders or the
Majority Lenders, as applicable, they shall co-operate fully with
the Administrative Agent to the extent requested by the
Administrative Agent in the collective realization including,
without limitation, the appointment of a receiver and manager to
act for their collective benefit; and each Lender covenants and
agrees to do all acts and things and to make, execute and deliver
all agreements and other instruments, including, without
limitation, any instruments necessary to effect any
registrations, so as to fully carry out the intent and purpose of
this Section 9.11; and each of the Lenders hereby covenants and
agrees that it has not heretofore and shall not seek, take,
accept or receive any security for any of the obligations and
liabilities of the Borrowers or any Guarantor hereunder or under
any other document, instrument, writing or agreement ancillary
hereto and shall not enter into any agreement with any of the
parties hereto or thereto relating in any manner whatsoever to
the Facility, unless all of the Lenders shall at the same time
obtain the benefit of any such agreement.
(b) Notwithstanding any other provision contained in this Agreement,
no Lender shall be required to be joined as a party to any
litigation commenced against the Borrowers or any Guarantor by
the Administrative Agent or the Majority Lenders hereunder
(unless otherwise required by any court of competent
jurisdiction) if it elects not to be so joined in which event any
such litigation shall not include claims in respect of the rights
of such Lender against the Borrowers and the Guarantors hereunder
until such time as such Lender does elect to be so joined;
provided that if at the time of such subsequent election it is
not possible or practicable for such Lender to be so joined, then
such Lender may commence proceedings in its own name in respect
of its rights against the Borrowers and the Guarantors hereunder.
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9.12 RELIANCE UPON LENDERS
The Administrative Agent shall be entitled to rely upon any certificate, notice
or other document provided to it by a Lender on behalf of all financial
institutions and Affiliates which together constitute a Lender pursuant to this
Agreement and the Administrative Agent shall be entitled to deal with the
Lenders with respect to the matters under this Agreement which are the
Administrative Agent's responsibilities without any liability whatsoever to the
Lenders for relying upon any certificate, notice or other document provided to
it by such Lender notwithstanding any lack of authority of the Lender to provide
the same or to bind the other financial institutions and Affiliates which
together constitute a Lender.
9.13 RELIANCE UPON ADMINISTRATIVE AGENT
The Borrower and the Guarantors shall be entitled to rely upon any certificate,
notice or other document provided to any of them by the Administrative Agent
pursuant to this Agreement and the Borrowers and the Guarantors shall be
entitled to deal with the Administrative Agent (and, except as otherwise
specifically provided, not to deal with any Lender prior to an Event of Default)
with respect to all matters under this Agreement without any liability
whatsoever to the Lenders for relying upon any certificate, notice or other
document provided to any of them by the Administrative Agent, notwithstanding
any lack of authority of the Administrative Agent to provide the same. Without
limiting the generality of the foregoing, but subject as herein otherwise
specifically provided, none of the Lenders shall have any right to enforce
directly any of the provisions of this Agreement or to communicate with the
Borrowers and the Guarantors except through the Administrative Agent in
accordance with the terms of this Agreement or as otherwise specifically
provided in this Agreement. The provisions of this Article 9 are for the benefit
of the Administrative Agent and the Lenders and, except for the provisions of
Sections 9.2, 9.12, 9.13 and 9.14, may not be relied upon by the Borrowers or
the Guarantors.
9.14 REPLACEMENT OF CANCELLED COMMITMENTS
If, at any time prior to the Maturity Date, the Commitment of any Lender or
Lenders is cancelled, or any Lender fails to perform its obligations hereunder,
the Administrative Agent may, and at the request of the Borrowers, provided that
no Default or Event of Default has occurred and is continuing, shall use its
reasonable efforts to locate one or more other Persons ("SUBSTITUTE LENDERS")
satisfactory to the Borrowers (who may be an existing Lender) to become a Lender
and to assume all or a portion of the Commitment so cancelled, provided that the
Administrative Agent shall not be under any obligation to assume such cancelled
Commitment itself if the Administrative Agent is unable to locate any Substitute
Lenders. Upon locating one or more Substitute Lenders, the Administrative Agent
(on behalf of each of the parties hereto other than the Borrowers, the
Guarantors and the Lender or Lenders whose Commitment has been cancelled), the
Borrowers, the Guarantors and the Substitute Lenders shall make any appropriate
amendments to this Agreement which are required to incorporate such Substitute
Lender or Lenders hereunder. If any Substitute Lender is not an existing Lender,
then Celestica shall pay to the Administrative Agent an administration fee of
U.S. $3,500.
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9.15 DISCLOSURE OF INFORMATION
(a) The Borrowers agree that, if Celestica has given its prior
written consent to a Person being an assignee or transferee
hereunder, then the Administrative Agent or any Lender may
provide any such assignee or transferee or proposed assignee or
transferee pursuant to Section 11.11 with any information it has
concerning the financial condition of the Borrowers and their
Subsidiaries other than information delivered by the Borrowers to
the Administrative Agent and/or the Lenders on a confidential
basis which is not in the public domain; provided that, for
greater certainty, nothing in this Section 9.15(a) shall prevent
the Administrative Agent or any Lender from disclosing the terms
of this Agreement on a confidential basis to any proposed
assignee or transferee of any Lender; and provided further that
consent of the Borrowers shall not be required if an Event of
Default has occurred and is continuing.
(b) Subject to Section 9.15(a), the Administrative Agent and each of
the Lenders acknowledges the confidential nature of the
financial, operational and other information and data provided
and to be provided to it by the Borrowers pursuant hereto that is
not at the time it is so provided or (other than through a breach
of this Agreement) thereafter in the public domain and agrees to
use reasonable efforts to prevent the disclosure of such
information; provided, however, that:
(i) the Administrative Agent or any Lender may disclose all or
any part of such information if, (A) in the sole reasonable
opinion (stated in writing) of the Lenders' Counsel, such
disclosure is compellable by Applicable Law in connection
with any threatened judicial, administrative or
governmental proceeding or is required in connection with
any actual judicial, administrative or governmental
proceeding or (B) such disclosure is compellable by
Applicable Law, provided that in any such event the
Administrative Agent or the Lender will make reasonable
efforts to provide Celestica with prompt written notice of
any such compellable disclosure so that Celestica may seek
a protective order or other appropriate remedy or relief to
prevent such disclosure from being made. The failure to
deliver such notice or, where applicable, the giving of
such notice, shall not preclude disclosure by the
Administrative Agent or the Lender where legally required
in the opinion of Lenders' Counsel. In any event, the
Administrative Agent or Lender will furnish only that
portion of such information which, in the reasonable
opinion of the Lenders' Counsel, it is legally required to
disclose and will exercise reasonable efforts to obtain
reliable assurances that confidential treatment will be
accorded such information;
(ii) it shall incur no liability in respect of any disclosure of
such information to any, or pursuant to the requirements of
any, judicial authority, law enforcement agency, tax or
regulatory authority which it is required to make in
accordance with Applicable Law;
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(iii) it shall inform the Borrowers, as soon as is practicable,
of any disclosure of such information made by it unless
such disclosure is in the ordinary course of its business
or such tax or regulatory authority or such judicial
authority or law enforcement agency requires the
Administrative Agent or such Lender not to inform the
Borrowers of the disclosure of such information to it;
(iv) the Administrative Agent and each Lender may disclose all
or any part of such information on a confidential basis to
its auditors or to Lenders' Counsel or other counsel of
reputable standing on a confidential basis for the purpose
of seeking or obtaining accounting or legal advice;
(v) the Administrative Agent and each Lender may disclose such
information on a confidential basis to any Subsidiary or
Affiliate of the Administrative Agent or Lender if such
disclosure is required in connection with the
administration of the Facility;
(vi) if an Event of Default has occurred and is continuing, the
Administrative Agent or any Lender may disclose such
information to any other Agent or other Lenders on a
confidential basis in connection with any discussions
regarding or related to the resolution of such Event of
Default; and
(vii) the Administrative Agent and each Lender may disclose such
information with the prior written consent of Celestica.
9.16 ADJUSTMENTS OF RATEABLE PORTIONS
(a) In connection with any Drawdown (other than a Drawdown of a Swing
Line Advance), Conversion or Rollover or any reimbursement or
repayment of an Obligation, the Administrative Agent shall, in
its sole and unfettered discretion, have the right (but not the
obligation) to make adjustments of the amount of such Drawdown,
Conversion or Rollover advanced or paid by such Lender or the
amount of such reimbursement or repayment to be received by such
Lender in order to maintain the balances of the Advances made by
each Lender in the same portion as the Main Facility Rateable
Portion of each Lender.
(b) Upon the occurrence of an acceleration under Section 8.1(g),
8.1(h) or 8.2, if, with respect to any Lender, the aggregate of
all outstanding Advances made by such Lender is less than its
Global Rateable Portion (after giving effect to any adjustment
made pursuant to Subsection 9.16(a)) of the aggregate of all
outstanding Advances, the Administrative Agent may, by written
notice, require such Lender to pay to the Administrative Agent,
for the credit of the other Lenders, in such currency or
currencies as the Administrative Agent may in its discretion
determine, such amount as may be required so as to bring the
aggregate of all outstanding Advances made by such Lender equal
to its Global Rateable Portion of the aggregate of all
outstanding Advances. The Administrative Agent shall credit the
funds received from such Lender to any other Lender or Lenders,
as it may determine in its discretion, so as to render the
aggregate of the
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outstanding Advances made by each Lender equal to the Global
Rateable Portion of each Lender of all outstanding Advances.
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ARTICLE 10
COSTS, EXPENSES AND INDEMNIFICATION
10.1 COSTS AND EXPENSES
Each Borrower shall pay promptly, upon request by the Administrative Agent
accompanied by reasonable supporting documentation or other evidence, all
reasonable costs and expenses in connection with the due diligence pertaining to
or the preparation, printing, execution and delivery of this Agreement and the
other documents to be delivered hereunder including, without limitation, the
reasonable fees and out-of-pocket expenses of the Lenders' Counsel with respect
thereto. Except for ordinary expenses of the Administrative Agent relating to
the day-to-day administration of this Agreement, each Borrower further agrees to
pay all reasonable out-of-pocket costs and expenses (including reasonable fees
and expenses of counsel, accountants and other experts) in connection with the
syndication of the Facility and the interpretation, preservation or enforcement
of rights of the Administrative Agent and the Lenders under this Agreement and
the Loan Documents including, without limitation, all reasonable costs and
expenses sustained by them as a result of any failure by any of the Borrowers or
Guarantors to perform or observe its obligations contained in any of this
Agreement and the Loan Documents.
10.2 INDEMNIFICATION BY THE BORROWERS
In addition to any liability of each Borrower to any Lender or the
Administrative Agent under any other provision hereof, each Borrower shall
indemnify the Lenders and the Administrative Agent and hold each Lender and the
Administrative Agent harmless against any reasonable costs or expenses incurred
by a Lender or the Administrative Agent as a result of (i) any failure by such
Borrower to fulfil any of its obligations hereunder or under any Loan Document
in the manner provided herein including, without limitation, any cost or expense
incurred by reason of the liquidation or re-employment in whole or in part of
deposits or other funds required by any Lender to fund or maintain any Advance
as a result of the failure of such Borrower to complete a Drawdown or to make
any repayment or other payment on the date required hereunder or specified by it
in any notice given hereunder; or (ii) the failure of such Borrower to pay any
other amount including, without limitation, any interest or fee due hereunder on
its due date; or (iii) the prepayment or repayment by such Borrower of any LIBOR
Advance prior to its date of maturity or the last day of the then current
Interest Period for such Advance.
10.3 FUNDS
Each amount advanced, made available, disbursed or paid hereunder shall be
advanced, made available, disbursed or paid, as the case may be, in immediately
available funds or, after notice from the Administrative Agent, in such other
form of funds as may from time to time be customarily used in the jurisdiction
in which the Advance is advanced, made available, disbursed or paid in the
settlement of banking transactions similar to the banking transactions required
to give effect to the provisions of this Agreement on the day such advance,
disbursement or payment is to be made.
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10.4 GENERAL INDEMNITY
(a) INDEMNITY. Subject to paragraphs (b), (c) and (d) below, the
Borrowers agree to indemnify and save harmless the Administrative
Agent, the Lenders, their respective Affiliates involved in the
syndication or administration of the Facility, their respective
officers, directors, employees and agents (collectively, the
"INDEMNITEES" and individually, an "INDEMNITEE") from and against
any and all liabilities, claims, damages and losses (including
reasonable legal fees and disbursements of counsel but excluding
loss of profits and special or consequential damages)
(collectively, the "LOSSES") as a result of any claims, actions
or proceedings ("CLAIMS") asserted against the Indemnitees, by a
Person other than the Indemnitees in connection with the
agreement of the Lenders to provide the Facility, the Commitments
of the Lenders and the Advances made by the Lenders including,
without limitation: (i) the costs of defending and/or
counterclaiming or claiming over against third parties in respect
of any Claim; and (ii) subject to the provisions set forth in
paragraph (d) below, any Losses arising out of a settlement of
any Claim made by the Indemnitees.
(b) LIMITATIONS TO INDEMNITY. The foregoing obligations of
indemnification shall not apply to (i) any Losses suffered by the
Indemnitees or any of them or to any Claim asserted against the
Indemnitees or any of them to the extent such Loss or Claim has
resulted from the gross negligence or wilful misconduct of the
Indemnitees or any of them; and (ii) any Losses with respect to
Taxes for which an Indemnitee may claim an indemnity from an
Obligor pursuant to Section 3.5(b) of this Agreement.
(c) NOTIFICATION. Whenever a Lender or the Administrative Agent shall
have received notice that a Claim has been commenced or
threatened, which, if successful, would subject a Borrower (the
"INDEMNIFYING PARTY") to the indemnity provisions of this Section
10.4, the Lender or Agent shall as soon as reasonably possible
notify (to the extent permitted by law) the Indemnifying Party in
writing of the Claim and of all relevant information the Lender
or the Administrative Agent possesses relating thereto; provided,
however, that failure to so notify the Indemnifying Party shall
not release it from any liability which it may have on account of
the indemnity set forth in this Section 10.4, except to the
extent that the Indemnifying Party shall have been materially
prejudiced by such failure.
(d) DEFENCE AND SETTLEMENT. The Indemnifying Party shall have the
right, but not the obligation, to assume the defence of any Claim
in any jurisdiction with legal counsel of reputable standing in
order to protect the rights and interest of the Indemnitees. In
such respect, (i) the Indemnifying Party shall require the
consent of the Indemnitees to the choice of legal counsel in
connection with the Claim, which consent shall not be
unreasonably withheld or delayed; and (ii) without prejudice to
the rights of the Indemnitees to retain counsel and participate
in the defence of the Claim, the Indemnifying Party and the
Indemnitees shall make all reasonable efforts to co-ordinate
their course of action in connection with the defence of such
Claim. The related costs and expenses sustained in such respect
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by the Indemnitees shall be at the expense of the Indemnifying
Party, provided that the Indemnifying Party shall only be liable
for the costs and expenses of one firm of separate counsel in
addition to the cost of any local counsel that may be required.
If the Indemnifying Party fails to assume defence of the Claim,
the Indemnitees will (upon further notice to the Borrowers) have
the right to undertake, at the expense of the Indemnifying Party,
the defence, compromise or settlement of the Claim on behalf and
for the account and risk of the Indemnifying Party, subject to
the right of the Indemnifying Party to assume the defence of the
Claim at any time prior to settlement, compromise or final
determination thereof.
Notwithstanding the foregoing, in the event the Indemnitee, acting reasonably,
does not agree with the manner or timeliness in which the legal counsel of the
Indemnifying Party is carrying on the defence of the Claim, or, pursuant to the
opinion of a reputable counsel retained by the Indemnitee, there may be one or
more legal defences available different from the one carried on by the legal
counsel of the Indemnifying Party, the Indemnitee shall have the right to assume
its own defence in the Claim by appointing its own legal counsel. The costs and
the expenses sustained by the Indemnitee shall be at the expense of the
Indemnifying Party provided that the Indemnifying Party shall only be liable for
the costs and expenses of one firm of separate counsel, in addition to the costs
of any local counsel that may be required.
The Indemnifying Party shall not be liable for any settlement of any Claim
effected without its written consent (which shall not be unreasonably withheld
or delayed). In addition, the Indemnifying Party will not, without the prior
written consent of the Indemnitee (which consent shall not be unreasonably
withheld or delayed), settle, compromise or consent to the entry of any judgment
in or otherwise seek to terminate any Claim or threatened Claim in respect of
which indemnification or contribution may be sought hereunder.
If an offer for settlement made to any Indemnitee which the Indemnifying Party
has recommended for acceptance is rejected by the Indemnitee and the final
liability of the Indemnitee in respect of such action and all related damages is
greater than such offer, the liability of the Indemnifying Party will only be to
indemnify the Indemnitee up to the amount of such offer.
10.5 ENVIRONMENTAL CLAIMS
(a) INDEMNITY. Subject to paragraphs (b), (c) and (d) below, the
Borrowers agree to indemnify and save harmless the Indemnitees
from and against any and all Losses as a result of any Claims
asserted against the Indemnitees by a Person other than the
Indemnitees with respect to any material presence or Release on,
into, onto, under or from any property owned, leased or operated
by any of the Borrowers or any Subsidiary (the "PROPERTY") of any
Hazardous Material regardless of whether caused by, or within the
control of, the Borrower or any Subsidiary or which arises out of
or in connection with any action of, or failure to act by, the
Borrowers or any Subsidiary or any predecessor or successor
thereof in contravention of any present or future applicable
Environmental Laws, whether or not having the force of law,
including, without limitation: (i) the costs of defending and/or
counterclaiming or claiming over against third parties in respect
of any such Claim; and (ii) subject to the provisions set forth
in paragraph (d)
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below, any Losses arising out of a settlement made by the
Indemnitees of any Claim.
(b) LIMITATIONS TO INDEMNITY. The foregoing obligations of
indemnification shall not apply to any Losses suffered by the
Indemnitees or any of them or to any Claim asserted against the
Indemnitees or any of them which relates directly to any action
or omission taken by any of the Indemnitees while in possession
or control of the Property which is grossly negligent or
constitutes wilful misconduct but shall apply to any Claim
occurring during such period that relates to a continuation of
conditions previously in existence or of a practise previously
employed by any Obligor.
(c) NOTIFICATION. Whenever an Indemnitee shall have received notice
that a Claim has been commenced or threatened, which, if
successful, would subject the Borrowers to the indemnity
provisions of this Section 10.5, the Indemnitee shall as soon as
reasonably possible and in any event on or before the expiry of
the date (the "NOTIFICATION DATE") which is the earlier of (i)
the tenth Banking Day after the receipt of such notice by the
Indemnitee, and (ii) such date as will afford sufficient time for
the Borrowers to prepare and file a timely answer to the Claim,
notify the Borrowers of the Claim and of all relevant information
the Indemnitee possesses relating thereto. If the Indemnitee
shall fail to so notify the Borrowers and provide it with such
information on or before the Notification Date, the Borrowers
shall not have any liability hereunder in respect of any Losses
suffered by the Indemnitee in respect of such Claim to the extent
such Losses may be reasonably attributable to such failure by the
Indemnitee.
(d) DEFENCE AND SETTLEMENT. The provisions of Section 10.4(d) shall
apply to any Claims under this Section 10.5.
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ARTICLE 11
GENERAL
11.1 TERM
The Facility shall expire on the Maturity Date.
11.2 SURVIVAL
All covenants, agreements, representations and warranties made herein or in
certificates delivered in connection herewith by or on behalf of the Borrowers
and each Guarantor shall survive the execution and delivery of this Agreement
and the making of the Drawdowns hereunder and shall continue in full force and
effect so long as there is any obligation of the Borrowers and each Guarantor to
the Administrative Agent, and the Lenders hereunder.
11.3 BENEFIT OF THE AGREEMENT
This Agreement shall enure to the benefit of and be binding upon the successors
and permitted assigns of the Borrowers and the successors and permitted assigns
of the Administrative Agent and the Lenders.
11.4 NOTICES
All notices, requests, demands or other communications to or from the parties
hereto shall be in writing and shall be given by overnight delivery service, by
hand delivery or by telecopy to the addressee as follows:
(i) If to the Borrowers:
0xx Xxxxx
00 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
Attention: Vice-President and Corporate Treasurer
Telecopier: 000-000-0000
with a copy to:
0xx Xxxxx
00 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
Attention: Vice-President and General Counsel
Telecopier: 000-000-0000
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(ii) If to the Administrative Agent (in respect of all
matters):
The Bank of Nova Scotia
Loan Syndications
00 Xxxx Xxxxxx Xxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx
X0X 0X0
Attention: Managing Director
Telecopier: 000-000-0000
(iii) if to a Lender, at the addresses set out in
Schedule A or in the relevant Transfer Notice;
or at such other address or to such other individual as the Borrowers may
designate by notice to the Administrative Agent and as the Administrative Agent
or a Lender may designate by notice to the Borrowers and the Lenders or the
Administrative Agent, as the case may be.
11.5 AMENDMENT AND WAIVER
This Agreement and any Loan Documents collateral hereto may be modified or
amended and a waiver of any breach of any term or provision of this Agreement
shall be effective only if the Borrowers, the Administrative Agent and the
Majority Lenders so agree in writing, provided that in all cases the Borrowers
shall be entitled to rely upon the Administrative Agent, without further inquiry
in respect of any amendments or waivers agreed to by the Administrative Agent
and which the Administrative Agent has confirmed have been agreed to by the
Majority Lenders; provided further, however, that no amendment, waiver or
consent, unless in writing and signed by all of the Lenders shall: (i) increase
the Commitment of any Lender or subject any Lender to any additional obligation;
(ii) reduce the principal of, or interest on, the Advances or reduce any fees
hereunder; (iii) postpone any date fixed for any payment of principal of, or
interest on, the Advances or any other amounts payable hereunder; (iv) change
the Global Rateable Portion of any Lender except for adjustments thereto made by
the Administrative Agent in accordance with the terms of this Agreement, or the
aggregate unpaid principal amount of the Advances, or the number of Lenders
which shall be required for the Lenders to take any action hereunder; (v) amend
the definition of Majority Lenders; (vi) amend or release any Guarantee, except
to the extent that a release of a Guarantee may be effected pursuant to a
transaction subject to Section 11.12 or is otherwise authorized pursuant to the
terms of this Agreement and except to the extent that an amendment, as
determined by the Administrative Agent and Lenders' Counsel, each acting
reasonably, does not materially impair the enforceability or unconditionality of
such Guarantee; or (vii) amend this Section 11.5; and provided, further, that no
amendment, waiver or consent, unless in writing and signed by the Administrative
Agent or Swing Line Lender, as applicable, in addition to the Lenders required
herein above to take such action, affects the rights or duties of the
Administrative Agent or Swing Line Lender, as applicable, under this Agreement
or any Advance. A waiver of any breach of any term or provision of this
Agreement shall be limited to the specific breach waived.
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11.6 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of
the Province of
Ontario and the laws of Canada applicable therein. The
Administrative Agent, Lenders and Borrowers agree that any legal suit, action or
proceeding arising out of this Agreement or any Loan Document may be instituted
in the courts of Ontario, and the Administrative Agent, Lenders and Borrowers
hereby accept and irrevocably submit to the nonexclusive jurisdiction of said
courts and acknowledge their competence and agree to be bound by any judgment
thereof.
11.7 FURTHER ASSURANCES
Each Obligor shall promptly cure any default in its execution and delivery of
this Agreement or in any of the other instruments referred to or contemplated
herein to which it is a party. Each Obligor, at its expense, will promptly
execute and deliver, or cause to be executed and delivered, to the
Administrative Agent, upon request, all such other and further documents,
agreements, certificates and instruments in compliance with, or accomplishment
of the covenants and agreements of such Obligor hereunder or more fully to state
the obligations of such Obligor as set out herein or to make any recording, file
any notice or obtain any consents, all as may be necessary or appropriate in
connection therewith.
11.8 ENFORCEMENT AND WAIVER BY THE LENDERS
Subject to Section 9.11, the Lenders shall have the right at all times to
enforce the provisions of this Agreement and agreements to be delivered pursuant
hereto in strict accordance with the terms hereof and thereof, notwithstanding
any conduct or custom on the part of the Lenders in refraining from so doing at
any time or times. The failure of the Lenders at any time or times to enforce
their rights under such provisions, strictly in accordance with the same, shall
not be construed as having created a custom in any way or manner, modified or
waived the same. All rights and remedies of the Lenders are cumulative and
concurrent and the exercise of one right or remedy shall not be deemed a waiver
or release of any other right or remedy.
11.9 EXECUTION IN COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be
considered an original and all of which taken together shall constitute a single
agreement.
11.10 ASSIGNMENT BY THE BORROWERS
The rights and obligations of the Borrowers under this Agreement are not
assignable to any other Person, except in accordance with Article 5, without the
prior written consent of all of the Lenders, which consent shall not be
unreasonably withheld.
11.11 ASSIGNMENTS AND TRANSFERS BY A LENDER
(a) With the prior written consent of the Administrative Agent and
Celestica, such consent not to be unreasonably withheld or
delayed, any Lender may, at any time, assign all or any of its
rights and benefits hereunder or transfer in accordance with
Section 11.11(b) all or any of its rights, benefits and
obligations hereunder; provided that in the event that such
assignment would give rise to a claim for
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increased costs pursuant to Article 3, it shall not be
unreasonable for Celestica to withhold its consent to such
assignment. Any assignment or transfer shall be with respect to a
minimum Commitment of U.S. $25,000,000 and integral multiples of
U.S. $1,000,000 in excess thereof. A lesser amount may be
assigned or transferred by any Lender if such amount represents
the remaining balance of such Lender's Commitment.
Notwithstanding the foregoing, the consent of the Administrative
Agent and Celestica is not required in connection with the
assignment or transfer of all or any of the rights, benefits and
obligations hereunder (i) to any Subsidiary or Affiliate of a
Lender or to any other Lender hereunder provided that notice is
given to the Administrative Agent and Celestica, and provided
that, in either case, any such assignment or transfer does not
give rise to a claim for increased costs pursuant to Article 3 or
any obligation on the part of an Obligor to deduct or withhold
any Taxes from or in respect of any sum payable hereunder to the
Administrative Agent or the Lenders, in either case, in excess of
what would have been the case without such assignment, or such
assignee waives the rights to any benefits under Section 3.5; or
(ii) to any financial institution if an Event of Default has
occurred and is continuing.
(b) If any Lender assigns all or any of its rights and benefits
hereunder in accordance with Section 11.11(a), then, unless and
until the assignee has agreed with the Administrative Agent and
the other Lenders (in a Transfer Notice or otherwise) that it
shall be under the same obligations towards each of them as it
would have been under if it had been an original party hereto as
a Lender, none of the Administrative Agent or any of the other
Lenders or the Borrowers shall be obliged to recognize such
assignee as having the rights against each of them which it would
have had if it had been such a party hereto.
(c) If any Lender wishes to assign all or any of its rights, benefits
and/or obligations hereunder as contemplated in Section 11.11(a),
then such transfer may be effected upon:
(i) receipt of the written consent of the Administrative Agent
and Celestica as referred to in Section 11.11(a) delivered
to the relevant assignee by the Administrative Agent unless
an Event of Default has occurred and is continuing in which
case consent of Celestica shall not be required;
(ii) the delivery to and countersignature by the Lender of a
duly completed and duly executed Transfer Notice; and
(iii) if any Lender wishes to assign any of its rights, benefits
and/or obligations hereunder to a financial institution
which is not a Lender or a Subsidiary or Affiliate of a
Lender, such Lender shall have paid to the Administrative
Agent a fee in the amount of U.S. $3,500;
in which event, on the later of the effective date, if any,
specified in such Transfer Notice and the fifth Banking Day
after the date of delivery of such Transfer Notice to the
Administrative Agent (unless the Administrative Agent
agrees to a shorter period):
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(iv) to the extent that in such Transfer Notice the Lender party
thereto seeks to transfer its rights and obligations
hereunder, each of the Obligors and such Lender shall be
released from further obligations towards one another
hereunder and their respective rights against one another
shall be cancelled (such rights and obligations being
referred to in this Section 11.11(c) as "DISCHARGED RIGHTS
AND OBLIGATIONS");
(v) each of the Obligors and the assignee party thereto shall
assume obligations towards one another and/or acquire
rights against one another which differ from such
discharged rights and obligations only insofar as such
Obligor and such Assignee have assumed and/or acquired the
same in place of such Obligor and such Lender; and
(vi) the Administrative Agent, such assignee and the other
Lenders shall acquire the same rights and assume the same
obligations between themselves as they would have acquired
and assumed had such assignee been an original party hereto
as a Lender with the rights and/or obligations acquired or
assumed by it as a result of such transfer.
(d) Each of the parties hereto confirms that:
(i) the delivery to an assignee of a Transfer Notice signed by
a Lender constitutes an irrevocable offer (subject to the
conditions of Section 11.11(c)) by each of the parties
hereto to accept such transferee (subject to the conditions
set out herein) as a Lender party hereto with the rights
and obligations so expressed to be transferred;
(ii) such offer may be accepted by such assignee by the
execution of such Transfer Notice by such assignee and upon
fulfilment of the conditions set forth in Section 11.11(c);
and
(iii) the provisions of this Agreement shall apply to the
contract between the parties thereto arising as a result of
acceptance of such offer.
(e) The Administrative Agent shall not be obliged to accept any
Transfer Notice received by it hereunder and no such Transfer
Notice may take effect on any day on or after the receipt by the
Administrative Agent of a Drawdown Notice and prior to the date
for the making of the proposed Advance.
(f) No transfer pursuant to this Section 11.11 shall, unless the
Administrative Agent otherwise decides in its absolute discretion
and notifies the parties to such transfer accordingly, be
effective if the date for effectiveness of such transfer on the
day on which the Administrative Agent receives the applicable
Transfer Notice is on, or less than five Banking Days before, the
day for the payment of any interest or fee hereunder.
(g) Any Lender may participate all or any part of its interest
hereunder, provided that any such participation does not give
rise to a claim for increased costs pursuant to
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Article 3 or any obligation on the part of an Obligor to deduct
or withhold any Taxes from or in respect of any sum payable
hereunder to the Administrative Agent or the Lenders, or such
Lender and participant waive the right to any benefits under
Section 3.5 and, in such case, notice of such participation has
been given to the Administrative Agent and Celestica. Such
participant shall not be entitled to any vote as a Lender. The
Borrowers shall not be obligated to deal with any participant and
shall be entitled to deal solely with the Lender and the Lender
shall not be released from any of its obligations to the
Borrowers as a result of such participation except to the extent
that the participant has fulfilled such obligations. Such
participants shall be bound to the same confidentiality
provisions with respect to the Facility, the Borrowers and the
Guarantors as are applicable to the Lenders.
11.12 CERTAIN REQUIREMENTS IN RESPECT OF MERGER, ETC.
No Borrower shall, and the Borrowers shall not permit any Restricted Subsidiary
(in each case, a "PREDECESSOR CORPORATION") to, enter into any transaction
(whether by way of liquidation, dissolution, amalgamation, merger, transfer,
sale or otherwise) whereby all or substantially all of its undertaking, property
and assets would become the property of any other Person or, in the case of any
such amalgamation or merger, of the continuing company resulting therefrom, or
whereby the obligation of the Predecessor Corporation to pay amounts under this
Agreement would become subject to novation or assumed or undertaken by any other
such Person or continuing company (a "CORPORATE REORGANIZATION"), provided that
it may do so (and if the Predecessor Corporation is a Borrower or a Material
Restricted Subsidiary such Person or continuing company shall become a party to
this Agreement or to the Guarantee provided by such Material Restricted
Subsidiary, as the case may be) if:
(a) such other Person or continuing company (herein referred to as a
"SUCCESSOR CORPORATION") is a Borrower or Restricted Subsidiary;
(b) where required in the reasonable opinion of Lenders' Counsel, a
Successor Corporation which is a Borrower or Material Restricted
Subsidiary shall execute and/or deliver to the Administrative
Agent an agreement supplemental hereto or to the Guarantee or
Guarantees executed by a Predecessor Corporation or Predecessor
Corporations, as the case may be, in form reasonably satisfactory
to the Administrative Agent and execute and/or deliver such other
instruments, if any, which to the reasonable satisfaction of the
Administrative Agent and in the opinion of Lenders' Counsel are
necessary to evidence (i) the assumption by the Successor
Corporation of liability under each Loan Document to which the
Predecessor Corporation is a party for the due and punctual
payment of all money payable by the Predecessor Corporation
thereunder, and (ii) the covenant of the Successor Corporation to
pay the same and (iii) the agreement of the Successor Corporation
to observe and perform all the covenants and obligations of the
Predecessor Corporation under each Loan Document to which the
Predecessor Corporation was a party and to be bound by all the
terms of each such Loan Document so far as they relate to the
Predecessor Corporation which instruments, if any, shall be in
form reasonably satisfactory to the Administrative Agent;
-86-
(c) such transaction would not have a Material Adverse Effect;
(d) all Other Taxes payable as a result of such transaction have been
paid;
(e) such transaction will not result in any claim for increased costs
pursuant to Section 3.2 or result in any Tax being levied on or
payable by the Administrative Agent or any Lender (except for
Taxes on the overall net income or capital of the Administrative
Agent or a Lender provided there is no increase in such Taxes as
a result of such transaction);
(f) such transaction will not cause, or have the result of the
Administrative Agent, the Lenders or any of them being in default
under, noncompliance with, or violation of, any Applicable Law;
(g) an opinion of Borrowers' counsel substantially in the form and as
to matters addressed in the opinion of Borrowers' Counsel
delivered pursuant to Section 4.1 shall have been delivered to
the Administrative Agent;
(h) each of the covenants set forth in Section 7.3 shall be satisfied
on an actual and PRO FORMA basis after giving effect to such
transaction; and
(i) no Default or Event of Default shall have occurred and be
continuing or will occur as a result of such transaction.
Sections 11.12(a), (b) and (g) shall not apply to (i) the respective liquidation
or dissolution of Celestica Ireland B.V. and Celestica Denmark A/S or (ii) the
merger of Celestica Japan EMS K.K. with and into Celestica Japan K.K.
This Section 11.12 shall not apply to permit any consolidation, amalgamation or
merger by or of Celestica unless, as the result thereof, the Successor
Corporation is Celestica.
A Successor Corporation shall not be required to comply with Section 11.12(b)
and (g) in respect of a Corporate Reorganization where one or more of the
participants in the subject Corporate Reorganization is a Predecessor
Corporation which is a Borrower or Restricted Subsidiary existing under the laws
of an Exempted Jurisdiction and which, prior to the completion of such Corporate
Reorganization, delivered a Guarantee in accordance with Section 7.1(m)(i) and
the Guarantee delivered by such Predecessor Corporation (the "PREDECESSOR
GUARANTEE") has not been terminated or released. In this paragraph, "EXEMPTED
JURISDICTION" means:
(i) the Province of Ontario, unless, following the date hereof,
the laws of such Province change in a manner that would
adversely affect the enforceability of the Predecessor
Guarantee against the Successor Corporation;
(ii) Canada, unless following the date hereof, the laws of
Canada or the laws of the Province of Canada which govern
such Guarantee change in a manner that would adversely
affect the enforceability of the Predecessor Guarantee
against the Successor Corporation; and
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(iii) the State of Delaware, unless, following the date hereof,
the laws of such State change in a manner that would
adversely affect the enforceability of the Predecessor
Guarantee against the Successor Corporation.
11.13 LOCATION OF LENDERS
Unless otherwise agreed between the Administrative Agent and Celestica, each
Lender shall be resident in Canada. In respect of any Lender which assigns or
shares part of its Commitment with an Affiliate or Subsidiary, the provisions of
Article 9 relating to the appointment and authorization of the Administrative
Agent and the indemnification of the Administrative Agent shall apply equally to
each such Affiliate and Subsidiary.
11.14 SET-OFF
If an Event of Default has occurred, the Administrative Agent and Lender shall
have the right to set off against any accounts, credits or balances maintained
by the Obligors with the Administrative Agent or any Lender, any amount due
hereunder.
11.15 TIME OF THE ESSENCE
Time shall be of the essence in this Agreement.
11.16 ADVERTISEMENTS
The Administrative Agent and the Lenders agree that prior to any advertisement
with respect to this transaction, the Administrative Agent shall obtain the
written consent of Celestica as to the form and content of such advertisement,
such consent not to be reasonably withheld and to be provided as soon as
practicable.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement.
THE BANK OF NOVA SCOTIA,
AS ADMINISTRATIVE AGENT
By: /s/ XXXXXX XXXXX
-------------------------------------
Name: Xxxxxx Xxxxx
Title: Managing Director
CELESTICA INC.
By: /s/ XXXX XXXXXXXXX
-------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Vice President & Corporate
Treasurer
CELESTICA INTERNATIONAL INC.
By: /s/ XXXX XXXXXXXXX
-------------------------------------
Name: Xxxx Xxxxxxxxx
Title: Vice President & Corporate
Treasurer
SIGNATURE PAGE FOR THE BANK OF NOVA SCOTIA, AS LENDER
THE BANK OF NOVA SCOTIA
By: /s/ XXXXX XXXXXXX
-------------------------------------
Name: Xxxxx Xxxxxxx
Title: Managing Director, Corporate
Banking - Communications
& Technology
By: /s/ XXXXX ORANGE
-------------------------------------
Name: Xxxxx Orange
Title: Associate Director, Corporate
Banking - Communications
& Technology
SIGNATURE PAGE FOR BANK OF AMERICA, N.A., CANADA BRANCH, AS LENDER
BANK OF AMERICA, N.A., CANADA BRANCH
By: /s/ XXXXXX SALES XX XXXXXXX
-------------------------------------
Name: Xxxxxx Sales xx Xxxxxxx
Title: Assistant Vice President
SIGNATURE PAGE FOR ROYAL BANK OF CANADA, AS LENDER
ROYAL BANK OF CANADA
By: /s/ XXXX X. XXXXXX
-------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
By: /s/ XXXXXX XXXXXX
-------------------------------------
Name: Xxxxxx Xxxxxx
Title: Senior Manager
SIGNATURE PAGE FOR CANADIAN IMPERIAL BANK OF COMMERCE, AS LENDER
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ XXXXX XXXXX
-------------------------------------
Name: Xxxxx Xxxxx
Title: Managing Director
By: /s/ XXXXX XXXXXXXXX
-------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Executive Director
SIGNATURE PAGE FOR CITIBANK N.A., CANADA BRANCH, AS LENDER
CITIBANK N.A., CANADA BRANCH
By: /s/ XXXXXXXX X. XXXXX
-------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Managing Director
SIGNATURE PAGE FOR CREDIT SUISSE FIRST BOSTON, TORONTO BRANCH, AS LENDER
CREDIT SUISSE FIRST BOSTON,
TORONTO BRANCH
By: /s/ XXXXX XXXXXX
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Director
By: /s/ XXXXX XXXXXXX
-------------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
SIGNATURE PAGE FOR DEUTSCHE BANK AG, CANADA BRANCH, AS LENDER
DEUTSCHE BANK AG, CANADA BRANCH
By: /s/ XXXXXX X XXXXXXXX
-------------------------------------
Name: Xxxxxx X Xxxxxxxx
Title: Vice President
By: /s/ XXXXX XXXXXX
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
SIGNATURE PAGE FOR THE BANK OF NOVA SCOTIA (ON ITS OWN ACCOUNT),
AS LENDER IN RESPECT OF THE COMMITMENT OF THE ROYAL BANK OF SCOTLAND PLC
THE BANK OF NOVA SCOTIA (ON ITS OWN
ACCOUNT, AND NOT AS AGENT), AS LENDER IN
RESPECT OF THE COMMITMENT OF THE ROYAL
BANK OF SCOTLAND PLC
By: /s/ XXXXX XXXXXXX
-------------------------------------
Name: Xxxxx Xxxxxxx
Title: Managing Director
SIGNATURE PAGE FOR NATIONAL BANK OF CANADA, AS LENDER
NATIONAL BANK OF CANADA
By: /s/ XX XXXXXX
-------------------------------------
Name: Xx Xxxxxx
Title: Vice President
By: /s/ XXXXX XXXXX
-------------------------------------
Name: Xxxxx Xxxxx
Title: Managing Director
SCHEDULE C
APPLICABLE MARGIN AND FACILITY FEE
INSERT FROM CREDIT AGREEMENT
--------------------------------------------------------------------------------------------------------------------------------
XXXXX X XXXXX XX XXXXX XXX XXXXX XX(0) XXXXX X LEVEL VI
--------------------------------------------------------------------------------------------------------------------------------
Senior Debt Rating(2) > or = BBB+/Baa 1 BBB/Baa2 BBB-/Baa3 XXxXx0 XX/Xx0 < BB/Ba2
(S&P/Xxxxx'x)
--------------------------------------------------------------------------------------------------------------------------------
LIBOR Margin 57.5 bps 67.5 bps 77.5 bps 95.0 bps 120.0 bps 145.0
Applicable Margin(3)
--------------------------------------------------------------------------------------------------------------------------------
Base Rate Applicable 0.0 bps 0.0 bps 0.0 bps 0.0 bps 20.0 bps 45.0
Margin(3)
--------------------------------------------------------------------------------------------------------------------------------
Facility Fee(4) 7.5 bps 20.0 bps 22.5 bps 30.0 bps 40.0 bps 50.0
--------------------------------------------------------------------------------------------------------------------------------
NOTES:
1. Level IV will apply at closing.
2. In the event of a split rating, the higher rating shall apply, unless
there are two or more gradations between ratings, in which case, the
rating one level below the higher rating shall apply.
3. "Applicable Margin" expressed as basis points per annum.
4. Facility Fee is payable regardless of usage on the aggregate
Commitments (after giving effect to any cancellation, reduction, or
increase pursuant to Sections 2.6, 2.7, and 2.20).
SCHEDULE J
CALCULATION OF THE MANDATORY COST
1. The Mandatory Cost for a LIBOR Advance for each of its Interest Period
is the rate determined by the Administrative Agent in accordance with
the following formulae:
IN RELATION TO ANY LIBOR ADVANCE:
F x 0.01 % per annum = Mandatory Cost
---------
300
WHERE ON THE DAY OF APPLICATION OF THE FORMULA:
F is the charge payable by the Administrative Agent to the
Financial Services Authority under paragraph 2.02 or 2.03 (as
appropriate) of the Fees Regulations but where for this
purpose, the figure in paragraph 2.02b and 2.03b will be
deemed to be zero expressed in pounds per L1 million of
the fee base of the Administrative Agent
2. For the purposes of this Schedule "J":
i. "FEE BASE" has the meaning given to it in the
Fees Regulations;
"FEES REGULATIONS" means any regulations governing the
payment of fees for banking supervision.
ii. "RELEVANT PERIOD" in relation to each Interest Period,
means:
A. if it is three months or less, that Interest
Period; or
B. if it is more than three months, each
successive period of three months and any
necessary shorter period comprised in that
Interest Period.
3. i. The formula is applied on the first day of each
relevant period comprised in the relevant
Interest Period.
ii. Each rate calculated in accordance with the formula is,
if necessary, rounded upward to the nearest 1/16th of
one percent.
4. If the Administrative Agent determines that a change in circumstances
has rendered, or will render, the formula inappropriate, the
Administrative Agent shall notify
Celestica Inc. and Celestica
International Inc. of the manner in which the Mandatory Cost will
subsequently be calculated. The manner of calculation so notified by
the Administrative Agent shall, in the absence of manifest error, be
binding on all the parties.
