NORTEL NETWORKS LIMITED as Seller and FLEXTRONICS TELECOM SYSTEMS LTD. as Purchaser FIFTH AMENDING AGREEMENT TO ASSET PURCHASE AGREEMENT May 8, 2006 Stikeman Elliott LLP
Exhibit 10.3
NORTEL NETWORKS LIMITED
as Seller
and
FLEXTRONICS TELECOM SYSTEMS LTD.
as Purchaser
FIFTH AMENDING AGREEMENT TO ASSET PURCHASE AGREEMENT
May 8, 2006
Stikeman Elliott LLP
FIFTH AMENDING AGREEMENT
TO ASSET PURCHASE AGREEMENT
TO ASSET PURCHASE AGREEMENT
THIS FIFTH AMENDING AGREEMENT TO ASSET PURCHASE AGREEMENT is made as of the 8th day
of May, 2008 (“Amending Agreement”) by and among Flextronics Telecom Systems Ltd., a Mauritius
corporation (“Purchaser”), Flextronics International Ltd., a Singapore corporation acting through
its Hong Kong office (the “Guarantor”) and Nortel Networks Limited, a Canadian corporation
(“Seller”).
WHEREAS the Purchase, the Seller and the Guarantor (collectively the “Asset Purchase Agreement
Parties”) entered into an Asset Purchase Agreement dated as of June 29, 2004, whereby the Seller
agreed to sell, or cause the Designated Sellers to sell, as the case may be, and the Purchaser
agreed to purchase, or cause the Designated Purchasers to purchase, as the case may be, the Assets
related to the Operations (the “Purchase Agreement”);
AND WHEREAS the Asset Purchase Agreement Parties entered into an amending agreement dated as
of the 1st day of November, 2004 (the “First Amending Agreement”), whereby the Parties
amended certain terms and conditions of the Purchase Agreement and certain of the Transaction
Documents;
AND WHEREAS the Asset Purchase Agreement Parties entered into a second amending agreement
dated as of the 7th day of February, 2005 (the “Second Amending Agreement”), whereby the
Parties amended certain terms and conditions of the Purchase Agreement and certain of the
Transaction Documents;
AND WHEREAS the Asset Purchase Agreement Parties entered into a third amending agreement dated
as of the 22nd day of August, 2005 (the “Third Amending Agreement”), whereby the Parties
amended certain terms and conditions of the Purchase Agreement and certain of the Transaction
Documents;
AND WHEREAS immediately prior to the execution of this Agreement the Asset Purchase Agreement
Parties entered into a fourth amending agreement dated as of the 8th day of May, 2006
(the “Fourth Amending Agreement”), whereby the Parties amended certain terms and conditions of the
Purchase Agreement and certain of the Transaction Documents;
AND WHEREAS the Purchaser and Nortel Networks U.K. Limited completed as of the 1st
day of November, 2004 the Facility/Design Closing pertaining to the Design Operations carried on by
the UK Design Employees;
AND WHEREAS the Purchaser, Seller and Nortel Networks Technology Corporation completed as of
the 1st day of November, 2004 the Facility/Design Closing pertaining to the Design
Operations carried on by the Canada Design Employees at the Ottawa Lab 2/Lab 10 Facility;
AND WHEREAS the Purchaser and the Seller completed as of the 7th day of February,
2005 the Facility/Design Closing for the Montreal Ban 1 Facility and the Montreal Ban 3 Facility;
AND WHEREAS the Purchaser and the Seller completed as of the 22nd day of August, 2005 the
Facility/Design Closing for the Chateaudun Facility (the “Chateaudun Closing”);
AND WHEREAS the Asset Purchase Agreement Parties agreed that the Seller shall retain, and the
Purchaser shall not purchase, the Monkstown Facilities and entered into the Fourth Amending
Agreement to reflect such agreement; and
AND WHEREAS the Asset Purchase Agreement Parties have agreed to complete the Closing for the
Calgary Westwinds Facility on May 8, 2006 (the “Calgary Closing”), and have agreed to enter into
this Amending Agreement concurrently with this transaction; and
AND WHEREAS the Asset Purchase Agreement Parties have further agreed to amend certain
additional terms and conditions of the Purchase Agreement and certain of the Transaction Documents
in accordance with the provisions of this Amending Agreement;
NOW THEREFORE, in consideration of the mutual covenants herein contained, the sufficiency and
receipt of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
DEFINITIONS
Section 1.1 Capitalized Terms and Section References.
All capitalized terms unless otherwise defined herein shall have the meaning ascribed thereto
in the Purchase Agreement, and all section references unless otherwise specified shall refer to the
Purchase Agreement.
Section 2.1 Alberta Employees
The parties hereby acknowledge that for purposes of Exhibits D-3 and D-3A, and the schedules
thereto, the term “Designated Purchaser”, insofar as it relates to the Alberta Employees, shall
refer to Flextronics (Canada) Inc.
Section 2.2 U.S. Employees
The parties hereby acknowledge that for the purposes of Exhibit D-9, D-9A and D-9B, and the
schedules thereto, the term “Designated Purchaser” refers to Flextronics International U.S.A., Inc.
ARTICLE 3
AMENDMENTS TO THE PURCHASE AGREEMENT
AMENDMENTS TO THE PURCHASE AGREEMENT
Section 3.1 Leased PC Equipment
Pursuant to Section 2.6 of the Asset Purchase Agreement, the Seller and Purchaser agreed to
certain matters regarding Leased PC Equipment. Subsequent to the Chateaudun Closing the Seller
revised its agreement with the vendor that provided the desktop and other PC support, and the
Seller purchased from that vendor the equipment that was formerly Leased PC Equipment. In order to
reflect this change, the following is hereby inserted after Section 2.6:
“Section 2.6A Certain Personal Computers. With respect to any Facility / Design
Closing which occurs after December 31, 2005, the Parties hereby agree as follows:
| (1) | Seller or the Designated Seller now own certain of the PCs and ancillary equipment used by the Employees in the Operations which were previously leased (collectively, the “Previously Leased PC Equipment”). The Parties agree that, in accordance with the specific terms of this Section 2.6A, these PCs and ancillary equipment form part of the Facility/Design Assets. The temporary use by the Purchaser and the Designated Purchaser, as the case may be, following the applicable Closing Date of Previously Leased PC Equipment shall be governed by the Shared Services Agreement. | ||
| (2) | The Parties acknowledge the Purchaser and its Affiliates may, but shall not be obligated to purchase such equipment from the |
| Seller or the Designated Seller, as the case may be, following the expiry of the Shared Services Agreement. | |||
| (3) | Schedule 2.6A lists and separately identifies each piece of Previously Leased PC Equipment used in the Operations. No later than (30) days prior to the termination of the applicable “SSA Period” (as that term is defined in the Shared Services Agreement), the Purchaser shall be entitled to request to purchase such equipment. The Seller will notify the Purchaser of the proposed transfer date (the “Transfer Date”) and the value (the “Transfer Value”), which amount shall be the Seller’s or Designated Seller’s, as the case may be, net book value of each item of such equipment as of the Transfer Date. Upon receipt of such notification, the Purchaser or relevant Designated Purchasers shall promptly advise the Seller whether it wishes to purchase the Previously Leased PC Equipment and, if it wishes to make such a purchase, upon receipt of a ▇▇▇▇ of sale from the Seller evidencing transfer of title of such Previously Leased PC Equipment, the Purchaser agrees to pay to the Seller as agent for the relevant Designated Seller on the relevant Transfer Date, (in immediately available funds in United States Dollars), the Transfer Value of the Previously Leased PC Equipment being transferred (and any applicable Transfer Taxes), in which case such equipment shall be deemed to be Owned Equipment and transferred pursuant to the terms of this Agreement as part of the transfer of the Facility/Design Assets for the applicable Facility or the Design Operations, as the case may be.” |
ARTICLE 4
DELIVERED AND REVISED SCHEDULES AND EXHIBITS
DELIVERED AND REVISED SCHEDULES AND EXHIBITS
Section 4.1 Delivered Schedules to the Purchase Agreement.
In relation to the Calgary Closing and pursuant to Section 5.1(3) of the Purchase Agreement,
the Parties hereby acknowledge delivery by the Seller or Purchaser, as the case may be, and
acceptance by the Seller or Purchaser, as the case may be, of the delivered schedules attached to
this Amending Agreement as Exhibit ”A”. For greater certainty, these schedules are provided
only in relation to the Calgary Closing.
Section 4.2 List of Delivered Schedules.
The schedules delivered pursuant to Section 4.1 of this Agreement are listed on Exhibit
“B”.
Section 4.3 Exhibits to the Nortel Proprietary Software License Agreement.
The complete list of Nortel Business Software Applications, which is Exhibit A to the Nortel
Proprietary Software License Agreement, is attached as Exhibit “C” hereto.
ARTICLE 5
FULL FORCE
FULL FORCE
Section 5.1 Full Force and Effect.
Other than for the foregoing amendments and for the correction set forth in Section 5.2 below,
the Purchase Agreement and certain schedules thereto, all other agreements agreed to or entered
into as of June 29, 2004, the First Amending Agreement, the Second Amending Agreement, the Third
Amending Agreement and the Fourth Amending Agreement shall remain in full force and effect,
unamended.
Section 5.2 Correction to Prior Amending Agreements.
Article 6 of each of the Second Amending Agreement and the Third Amending Agreement are hereby
amended to delete the word “Ontario” and replace it with “Alberta”.
ARTICLE 6
GENERAL
GENERAL
Section 6.1 Governing Law.
This Amending Agreement shall be governed by and construed in accordance with the laws of the
Province of Alberta and the laws of Canada applicable therein.
Section 6.2 Counterparts.
This Amending Agreement may be executed in one or more counterparts (including counterparts by
facsimile), each of which shall be deemed an original and all of which together constitute one and
the same instrument.
IN WITNESS WHEREOF the parties hereto have duly executed this Fifth Amending Agreement as of the
day, month and year first above written.
| FLEXTRONICS TELECOM SYSTEMS LTD. | ||||
| By: | /s/ ▇. ▇▇▇▇▇▇▇▇▇ | |||
| Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | ||||
| Title: Authorized Signatory | ||||
| NORTEL NETWORKS LIMITED | ||||
| By: | J. ▇▇▇▇ ▇▇▇▇▇▇▇ | |||
| Name: ▇▇▇▇ ▇▇▇▇▇▇▇ | ||||
| Title: Senior Vice-President, | ||||
| Global Supply Chain and Quality | ||||
| FLEXTRONICS INTERNATIONAL LTD., acting through its Hong Kong branch | ||||
| By: | /s/ ▇. ▇▇▇▇▇▇▇▇▇ | |||
| Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | ||||
| Title: Authorized Signatory | ||||
EXHIBIT “A”
DELIVERED SCHEDULES
DELIVERED SCHEDULES
See attached.
EXHIBIT “B”
LIST OF DELIVERED SCHEDULES
LIST OF DELIVERED SCHEDULES
| Schedule | Delivering Party | |
Schedule 1.1 — Designated Purchasers and Purchase Price Allocations
|
NNL / Flex | |
Schedule 1.1(33) — Collective Labour Agreements
|
NNL | |
Schedule 1.1(37) — Contracts
|
NNL | |
Schedule 1.1(44) — Design Employees
|
NNL | |
Schedule 1.1(57) — End of Life Inventory
|
NNL | |
Schedule 1.1(63) — Equipment At Third Party Locations
|
NNL | |
Schedule 1.1(113) — Inventory
|
NNL | |
Schedule 1.1(118) — IS Software
|
NNL | |
Schedule 1.1(122) — Key Employees
|
NNL | |
Schedule 1.1(123)(i) — NNL’s “Knowledge” List
|
NNL | |
Schedule 1.1(123)(ii) — Flex’s “Knowledge” List
|
Flex | |
Schedule 1.1(125) — Leased Equipment
|
NNL | |
Schedule 1.1(133) — Logistics Employees
|
NNL | |
Schedule 1.1(173) — Permitted Encumbrances
|
NNL | |
Schedule 1.1(199) — Repair Employees
|
NNL | |
Schedule 1.1(200) — Repair Inventory
|
NNL | |
Schedule 2.1(1)(d) — Owned Equipment
|
NNL | |
Schedule 2.1(1)(l) — Operating Permits
|
NNL | |
Schedule 2.1(1)(n) — Security Deposits
|
NNL | |
Schedule 2.1(1)(q) — Prepaid Expenses
|
NNL | |
Schedule 2.1(2)(p) — Other Excluded Assets
|
NNL | |
Schedule 2.3(2) — Cash Flow Payments
|
NNL | |
Schedule 2.6 — List of PCs and Ancillary Equipment To Be Transferred
|
NNL | |
Schedule 2.6A — List of Previously Leased PCs and Ancillary Equipment
To Be Transferred
|
NNL | |
Schedule 3.2(2)
— Flex’ Conflicts Exceptions
|
Flex | |
Schedule 3.6 — Flex’ Employee Plans and Actions
|
Flex | |
Schedule 4.1(3) — Nortel Subsidiaries Conducting Operations
|
NNL | |
Schedule 4.10 — Litigation
|
NNL | |
Schedule 4.11(1) — NNL’s Employee Plans
|
NNL | |
Schedule 4.11(2) — Compensation and Benefit Claims
|
NNL | |
Schedule 4.12(1) — Employees
|
NNL | |
Schedule 4.12(2) — Work Stoppages
|
NNL | |
Schedule 4.12(3) — Compliance with Employment Law Exception
|
NNL | |
Schedule 4.12(4) — Leave Employees
|
NNL |
| Schedule | Delivering Party | |
Schedule 4.12(5) — Long-Term Disability Leave Employees
|
NNL | |
Schedule 4.12(6) — Labour Relations Exceptions
|
NNL | |
Schedule 4.12(7) — Visa Employees
|
NNL | |
Schedule 4.12(8) — Workers’ Compensation Law Exceptions
|
NNL | |
Schedule 4.12(9) — Employee Accrued and Unused Vacation
|
NNL | |
Schedule 4.12(10) — Design, Repair and Logistics Employees
|
NNL | |
Schedule 4.12(11) — Collective Labour Agreement
|
NNL | |
Schedule 4.12(13) — U.S. Employee Job-Related Felony Convictions
|
NNL | |
Schedule 4.15 — Inventory Exceptions
|
NNL | |
Schedule 4.15 (1) — Inventory Forecasts
|
NNL | |
Schedule 4.17 — Equipment Exceptions
|
NNL | |
Schedule 4.19 — Sufficiency of Assets
|
NNL | |
Schedule 4.2(2) — NNL’s Conflicts Exceptions
|
NNL | |
Schedule 4.20 — Other Purchase Agreements
|
NNL | |
Schedule 4.21 — Government Assistance Programs
|
NNL | |
Schedule 4.3 — Financial Information
|
NNL | |
Schedule 4.5 — Absence of Certain Developments
|
NNL | |
Schedule 4.6 — Compliance with Laws, Permits and Licenses Exceptions
|
NNL | |
Schedule 4.8 — Contracts Exceptions
|
NNL | |
Schedule 4.8(9) — Other Third Party Payment Exceptions
|
NNL | |
Schedule 4.8(10) — Company-Wide Contracts Rights or Licenses
|
NNL | |
Schedule 4.9(1) — Other Intellectual Property Agreements/ Obligations
|
NNL | |
Schedule 4.9(2) — Intellectual Property Rights Claims Exceptions
|
NNL | |
Schedule 4.9(3) — Intellectual Property Rights Infringement Exceptions
|
NNL | |
Schedule 5.1(2) — Filings and Approvals
|
Flex | |
Schedule 5.2 — Operation of Business Exception
|
NNL |
EXHIBIT “C”
“Exhibit A” to the Nortel Proprietary Software License Agreement
“Exhibit A” to the Nortel Proprietary Software License Agreement
See Attached.