LETTER WAIVER
Exhibit 4.1.3
LETTER WAIVER
Dated as of August 10, 2006
To the banks, financial institutions |
Ladies and Gentlemen:
We refer to the Amended and Restated Credit and Guaranty Agreement, dated as of December 16, 2005, entered into by and among Sanmina-SCI Corporation (the Company), certain subsidiaries of the Company, as guarantors, the lenders from time to time party thereto, Bank of America, N.A., as Initial Issuing Bank, Citicorp USA, Inc., as Syndication Agent, The Bank of Nova Scotia, Deutsche Bank Trust Company Americas and KeyBank National Association, as Co-Documentation Agents, Banc of America Securities LLC and Citigroup Global Markets Inc., as Joint Book Managers and Joint Lead Arrangers, the Administrative Agent and Citibank, N.A., as Collateral Agent (the Collateral Agent), as amended by Amendment No. 1 to Amended and Restated Credit and Guaranty Agreement, dated as of June 30, 2006 (as so amended, the Credit Agreement). Capitalized terms not otherwise defined in this Letter Waiver have the same meanings as specified in the Credit Agreement.
Section 5.1 (a) of the Credit Agreement requires that we deliver to the Administrative Agent and the Lender Parties as soon as available, and in any event within forty five (45) days after the end of each of the first three Fiscal Quarters of each Fiscal Year, the consolidated balance sheets of Company and its Subsidiaries as at the end of such Fiscal Quarter and the related consolidated statements of income, stockholders equity and cash flows of Company and its Subsidiaries for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter together with a Financial Officer Certification and a Narrative Report with respect thereto. Section 5.1(c) of the Credit Agreement requires that we deliver to the Administrative Agent and the Lender Parties within five (5) days after each delivery of financial statements of Company and its Subsidiaries pursuant to Sections 5.1(a) and 5.1(b), a duly executed and completed Compliance Certificate.
We believe that we will be unable to deliver the financial statements for the Fiscal Quarter ended July 1, 2006, and the Financial Officer Certification and Narrative Report with Respect thereto, within the forty-five-day period required under Section 5.1(a), and therefore will be unable to deliver a Compliance Certificate pursuant to Section 5.1(c). Such failure to the
deliver such financial statements, and the Financial Officer Certification and Narrative Report with respect thereto, and the corresponding Compliance Certificate, within the required period will constitute a Default under the Credit Agreement. This Letter Waiver shall constitute notice of such Default pursuant to Section 5.1(e) of the Credit Agreement.
Section 8.1 (b) of the Credit Agreement provides that, if any there is a breach or default with respect to any material term of any indenture or other agreement relating to any Indebtedness in a principal amount of $50 million or greater and such breach or default would cause, or permit the holders of such Indebtedness (or a trustee on behalf of such holders) to cause, such Indebtedness to become or be declared due and payable or redeemable prior to its stated maturity, the occurrence of such breach or default beyond the applicable grace period set forth in such Indebtedness shall be an Event of Default under the Credit Agreement. We have been advised that it is a possibility that the trustees in respect of, or the holders of, the Companys 8.125% Senior Subordinated Notes due 2016, the New Senior Subordinated Notes and the 3% Notes, respectively, may notify us, in accordance with the respective terms thereof that our failure to deliver the financial statements for the Fiscal Quarter ended July 1, 2006 constitutes a default thereunder and will become an event of default if not cured or waived within he applicable grace period, at which time they may declare such Indebtedness due and payable as a consequence of such failure.
We hereby request that you waive the requirements of Section 5.1(a), Section 5.l(c) and Section 8.1(b) of the Credit Agreement, solely for the period commencing on the date first above written through the earlier to occur of (i) the date that is one day prior to the date upon which the Company shall have any obligation to prepay any of its Senior Subordinated Notes or its Convertible Notes pursuant to the respective terms thereof and (ii) September 5, 2006 (the Waiver Termination Date), and solely with respect to the delivery of the financial statements of the Company for the Fiscal Quarter of the Company ended July 1, 2006 and the Financial Officer Certification and Narrative Report with respect thereto. On the Waiver Termination Date, without any further action by the Administrative Agent and the Lenders, all of the terms and provisions set forth in the Credit Agreement with respect to the Defaults thereunder that are waived hereunder and not cured prior to the Waiver Termination Date shall have the same force and effect as if this Letter Waiver had not been entered into by the parties hereto, and the Administrative Agent and the Lenders shall have all of the rights and remedies afforded to them under the Credit Agreement with respect to such Defaults as though no waiver had been granted by them hereunder.
We further request that you waive the requirements of (i) Section 3.2(b) with respect to the representations and warranties contained in Sections 4.14 and 4.15 of the Credit Agreement through the Waiver Termination Date and solely with respect to any defaults under Contractual Obligations or Material Contracts arising from the failure of the Company to deliver the financial statements of the Company for the Fiscal Quarter ended July 1, 2006 or to file and deliver its Quarterly Report on Form 10-Q for the Fiscal Quarter ended July 1, 2006, (ii) Section 3.2(b) with respect to the representations and warranties contained in Sections 4.7, 4.9, 4.11 and 4.23 of the Credit Agreement through the Waiver Termination Date and solely with respect to the review by the Company of its stock option practices, the inquiry by the SEC with respect thereto and the results of the foregoing and the matters referred to in clause (i), and (iii) Section 3.2(c) solely with respect to the Defaults for which waivers are granted under this Letter Waiver
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(it being understood that the Company may qualify any Funding Notice or Notice of Issuance with respect to the foregoing clauses (i) through (iii)).
This Letter Waiver and the waivers requested herein shall become effective as of the date first above written when, and only when the Administrative Agent shall have received counterparts of this Letter Waiver executed by us and the Requisite Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Letter Waiver, and the consent attached hereto executed by each Guarantor and each Grantor. This Letter Waiver is subject to the provisions of Section 10.5 of the Credit Agreement.
The Credit Agreement and each of the other Credit Documents, except to the extent of the waiver specifically provided above, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. Without limiting the generality of the foregoing, the Collateral Documents and all of the Collateral described therein do and shall Continue to secure the payment of all Obligations of the Credit Parties under the Credit Documents. The execution, delivery and effectiveness of this Letter Waiver shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or any Agent under any of the Credit Documents, nor constitute a waiver of any provision of any of the Credit Documents.
If you agree to the terms and provisions of this Letter Waiver, please evidence such agreement by executing and returning four counterparts of this Letter Waiver to Eldyne Perrou at Shearman & Sterling, 525 Market Street, San Francisco, CA 94105, Facsimile: (415) 616 1325, Telephone ###-###-#### by no later than 5:00 P.M. (New York City time) on August 10, 2006.
This Letter Waiver may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Letter Waiver by telecopier shall be effective as delivery of a manually executed counterpart of this Letter Waiver.
This Letter Waiver shall be governed by, and construed in accordance with, the laws of the State of New York.
[BALANCE OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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Very truly yours, | ||||||
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| SANMINA-SCI CORPORATION | |||||
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| By | /s/ Walter Boileau |
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| Title: VP and Treasurer | ||||
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Agreed as of the date first above written: |
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BANK OF AMERICA, N.A., |
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as Administrative Agent and as Lender |
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By | /s/ [ILLEGIBLE] |
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| Title: Senior Vice President |
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Citicorp USA, Inc., as Lender |
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By | /s/ Avrum Spiegel |
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| Name: | Avrum Spiegel |
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| Title: | Vice President |
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The Bank of Nova Scotia, as Lender |
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By | /s/ Mark Sparrow |
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| Mark Sparrow |
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| Director |
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Deutsche Bank Trust Company Americas, as Lender |
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By | /s/ Paul OLeary |
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| Title: | Vice President |
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By | /s/ Evelyn Thierry |
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| Title: | Evelyn Thierry |
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| Vice President |
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KEYBANK NATIONAL ASSOCIATION, as Lender |
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By | /s/ [ILLEGIBLE] |
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| Title: Vice President |
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SUNTRUST BANK, as Lender |
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By | /s/ [ILLEGIBLE] |
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| Title: | Director |
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WELLS FARGO BANK, N.A., as Lender |
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By | /s/ Ling Li |
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| Title: Ling Li |
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CONSENT
Dated as of August , 2006
Each of the undersigned, as a Guarantor under the Credit Agreement and a Grantor under the Pledge and Security Agreement, dated as of October 26, 2004, among the Company, the other grantors party thereto, and the Collateral Agent (the Pledge and Security Agreement), in favor of the Administrative Agent and, for its benefit and the benefit of the Lenders parties to the Credit Agreement referred to in the foregoing Letter Waiver, hereby consents to such Letter Waiver and hereby confirms and agrees that (a) notwithstanding the effectiveness of such Letter Waiver, each of its Guaranty and the Pledge and Security Agreement is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, and (b) the Collateral Documents to which such Grantor is a party and all of the Collateral described therein do, and shall continue to, secure the payment of all of the Secured Obligations (in each case, as defined therein).
HADCO CORPORATION | |||||
| HADCO SANTA CLARA, INC. | ||||
| SCI TECHNOLOGY, INC. | ||||
| VIKING INTERWORKS INC. | ||||
| COMPATIBLE MEMORY, INC. | ||||
| SCI SYSTEMS, INC. | ||||
| SANMINA-SCI SYSTEMS (ALABAMA) INC. | ||||
| SANMINA-SCI SYSTEMS HOLDINGS, INC. | ||||
| INTERAGENCY, INC. | ||||
| SANMINA-SCI SYSTEMS ENCLOSURES | ||||
| SCIMEX, INC. | ||||
| NEWISYS, INC. | ||||
| SANMINA-SCI ENCLOSURES USA INC. | ||||
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| All By: | /s/ Walter Boileau |
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| Name: | Walter Boileau | ||
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| Title: | VP and Treasurer | ||
SCI PLANT No. 5, L.L.C. | |||||
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| By: | ||||
| SANMINA-SCI SYSTEMS (ALABAMA) INC., its | ||||
| Sole Member | ||||
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| By: | /s/ Walter Boileau |
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| Name: | Walter Boileau | ||
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| Title: | VP and Treasurer | ||
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| SCI PLANT No. 22, L.L.C. | ||||
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| By: | ||||
| SCI TECHNOLOGY, INC., | ||||
| its Sole Member | ||||
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| By: | /s/ Walter Boileau |
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| Name: | Walter Boileau | ||
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| Title: | VP and Treasurer | ||
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| SANMINA GENERAL, L.L.C. | ||||
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| All by: | ||||
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| SANMINA-SCI CORPORATION, | ||||
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| By: | /s/ Walter Boileau |
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| Name: | Walter Boileau | ||
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| Title: | VP and Treasurer | ||
SANMINA TEXAS, L.P. | |||||
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| By: | SANMINA GENERAL, L.L.C, | |||
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| By: | |||
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| SANMINA-SCI CORPORATION, | |||
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| its Sole Member | |||
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| By: | /s/ Walter Boileau |
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| Name: | Walter Boileau | ||
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| Title: | VP and Treasurer | ||