EXHIBIT 4.5
GUARANTY
This GUARANTY is entered into as of August 5, 1999, by CHIPPAC, INC., a
California corporation ("ChipPAC"), and THE UNDERSIGNED DIRECT AND INDIRECT
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SUBSIDIARIES OF CHIPPAC (each such undersigned Subsidiary, a "Subsidiary
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Guarantor", and all such Subsidiaries, collectively, the "Subsidiary
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Guarantors"; the Subsidiary Guarantors and ChipPAC being referred to herein
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collectively as the "Guarantors"; provided that, Guarantors shall be deemed to
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include any Additional Guarantors (as hereinafter defined)), in favor of CREDIT
SUISSE FIRST BOSTON ("CSFB"), as administrative agent (in such capacity, the
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"Administrative Agent") for the banks, financial institutions and other entities
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(collectively, the "Lenders") from time to time party to the Credit Agreement
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referred to below, any Interest Rate Exchangers (as hereinafter defined), any
Indemnitees (as defined in the Credit Agreement) and any other Beneficiaries (as
defined below).
RECITALS
A. ChipPAC International Company Limited, a British Virgin Islands
company (the "Company") has entered into that certain Credit Agreement dated as
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of August 5, 1999 (as amended, restated, supplemented or otherwise modified from
time to time, the "Credit Agreement") with the Lenders and CSFB, as the
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Administrative Agent, the Sole Lead Arranger and the Collateral Agent
(collectively, the "Agents"), pursuant to which the Lenders have severally
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agreed to make Loans to the Company and to issue (or participate in) Letters of
Credit for the account of ChipPAC and its Subsidiaries upon, and subject to, the
terms and conditions set forth therein.
B. ChipPAC and its Subsidiaries may from time to time enter, or may
from time to time have entered, into one or more Interest Rate Agreements
(collectively, the "Lender Interest Rate Agreements") with one or more Lenders
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or their Affiliates (in such capacity, collectively, the "Interest Rate
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Exchangers") in accordance with the terms of the Credit Agreement, and it is
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desired that the obligations of ChipPAC and its Subsidiaries under the Lender
Interest Rate Agreements, including without limitation the obligation of ChipPAC
and its Subsidiaries to make payments thereunder in the event of early
termination thereof, be guarantied hereunder.
C. A portion of the proceeds of the Loans may be advanced to the
Subsidiary Guarantors such that the Guarantied Obligations (as hereinafter
defined) are otherwise being incurred for and will inure to the benefit of the
Guarantors, and each Guarantor will derive substantial direct and indirect
benefit from the making of the Loans to, and the issuance of the Letters of
Credit for the account of, the Company.
D. It is a condition precedent to the obligations of each Lender to
make its respective Loans and to issue (or participate in) the Letters of Credit
under the Credit Agreement that each of the Guarantors guaranty the Guarantied
Obligations and execute and deliver this Guaranty to the Administrative Agent
for the ratable benefit of the Beneficiaries.
E. Each of the Guarantors is willing irrevocably and unconditionally to
guaranty such obligations pursuant to the terms hereof.
NOW, THEREFORE, based upon the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
in order to induce the Lenders to enter into the Credit Agreement and to make
the Loans and other extensions of credit thereunder (including without
limitation the issuance of (and participation in) the Letters of Credit) and to
induce the Interest Rate Exchangers to enter into the Lender Interest Rate
Agreements, each of the Guarantors hereby agrees as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms.
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Capitalized terms used herein (including in the Recitals hereto) and not
defined herein shall have the meanings assigned to such terms in the Credit
Agreement. As used in this Guaranty, the following terms shall have the
following meanings unless the context otherwise requires:
"Additional Guarantors" has the meaning assigned to that term in subsection
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3.12.
"Beneficiaries" means the Lenders, the Agents, any Interest Rate Exchangers
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and any Indemnitees and their respective successors, transferees, assigns and
endorsees.
"Company" has the meaning assigned to that term in the first recital.
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"CSFB" has the meaning assigned to that term in the preamble.
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"Guarantied Obligations" means, collectively, at any time:
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(a) (i) all unpaid principal of and interest on (including, without
limitation, interest accruing after the maturity of the Loans and interest
accruing after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding, relating to the Company,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) the Loans, (ii) all reimbursement obligations and unpaid
drawings in respect of Letters of Credit and (iii) all other obligations and
liabilities of every nature owing by the Company or any other Loan Party to any
Beneficiary arising under, out of or in connection with the Credit Agreement,
any other Loan Document, the Loans or the Letters of Credit;
(b) all obligations and liabilities of every nature owing by ChipPAC or any
of its Subsidiaries to any Interest Rate Exchangers arising under, out of or in
connection with the Lender Interest Rate Agreements; all of the foregoing,
whether direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter arising, created or incurred, as may be changed, modified
or altered from time to time, howsoever arising; and all of the foregoing
obligations shall include obligations which, but for any automatic stay under
any
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applicable Bankruptcy Law, including Section 362(a) of Title 11 of the United
States Code, would be, or would have become, due.
"Guarantors" has the meaning assigned to that term in the preamble.
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"Guaranty" means this Guaranty as it may be amended, restated, supplemented
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or otherwise modified from time to time in accordance with the provisions hereof
and the Credit Agreement.
"Interest Rate Exchangers" has the meaning assigned to that term in the
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second recital.
"Lender Interest Rate Agreements" has the meaning assigned to that term in
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the second recital.
"Obligee Guarantor" has the meaning assigned to that term in subsection
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2.7.
"payment in full," "paid in full" or any similar term means payment in
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full, in cash, of the Guarantied Obligations (other than indemnification
obligations not due and payable), including, without limitation, all principal,
interest, costs, fees and expenses (including, without limitation, reasonable
legal fees and expenses) of the Beneficiaries as required under the Loan
Documents and the Lender Interest Rate Agreements.
"Requisite Obligees" means (i) prior to the Guarantied Obligation described
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in clause (a) of the definition thereof having been satisfied or paid in full
(other than indemnification obligations not due and payable) and the Commitments
having been terminated and all Letters of Credit having expired or been
canceled, the Requisite Lenders, and (ii) thereafter, the holders of a majority
of the aggregate notional amount under all Lender Interest Rate Agreements (or,
with respect to any Lender Interest Rate Agreement that has been terminated in
accordance with its terms, the amount then due and payable (exclusive of
expenses and similar payments but including any early termination payments then
due) under such Lender Interest Rate Agreement).
Section 1.2 Interpretation.
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(a) References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Guaranty unless otherwise specifically
provided.
(b) In the event of any conflict or inconsistency between the terms,
conditions and provisions of this Guaranty and the terms, conditions and
provisions of the Credit Agreement, the terms, conditions and provisions of the
Credit Agreement shall prevail.
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ARTICLE II
THE GUARANTY
Section 2.1 Guaranty of the Guarantied Obligations.
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Subject to the provisions of subsection 2.2(a), each of the Guarantors
hereby jointly and severally, irrevocably and unconditionally, guaranties to the
Administrative Agent for the ratable benefit of the Beneficiaries, the prompt,
complete and punctual performance, compliance and payment in full of all
Guarantied Obligations when the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or
otherwise.
Section 2.2 Limitation on Amount Guarantied; Contribution by
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Guarantors.
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(a) Anything contained in this Guaranty to the contrary notwithstanding,
(i) this Agreement shall not constitute a guarantee by any Subsidiary Guarantor
which is not organized under the laws of the United States or any political
subdivision thereof of the Obligations of any Loan Party which is organized
under the laws of the United States or any political subdivision thereof and
(ii) the maximum liability of each Subsidiary Guarantor hereunder shall in no
event exceed the amount which can be guarantied by such Subsidiary Guarantor
pursuant hereto under applicable federal, state and foreign laws relating to the
insolvency of debtors and fraudulent conveyances or transfers. Each Guarantor
agrees that the Guarantied Obligations may at any time, and from time to time,
exceed the amount of the liability of such Guarantor hereunder without impairing
the guaranty of such Guarantor contained in subsection 2.1 or affecting the
rights and remedies of the Administrative Agent or any Beneficiary hereunder.
(b) Each Guarantor hereby agrees that to the extent that a Guarantor shall
have paid more than its proportionate share of any payment made hereunder, such
Guarantor shall be entitled to seek and receive contribution from and against
any other Guarantor hereunder which has not paid its proportionate share of such
payment and each other Guarantor agrees that it will contribute its
proportionate share of such payment to the applicable Guarantor. Each
Guarantor's right of contribution shall be subject to the terms and conditions
of subsections 2.6 and 2.7. The provisions of this subsection 2.2(b) shall in no
respect limit the obligations and liabilities of any Guarantor to any
Beneficiary, and each Guarantor shall remain liable to any Beneficiary for the
full amount guarantied by such Guarantor hereunder, subject only to subsection
2.2(a).
Section 2.3 Payment by Guarantors; Application of Payments.
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Subject to the provisions of subsection 2.2(a), each of the Guarantors
hereby jointly and severally agrees, in furtherance of the foregoing and not in
limitation of any other right which any Beneficiary may have at law or in equity
against any Guarantor by virtue hereof, that upon the failure of the Company to
pay or perform any of the Guarantied Obligations when and as the same shall
become due, whether at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise, each Guarantor will promptly, following
written demand, pay, or cause to be paid, to the Administrative Agent for the
ratable benefit of the Beneficiaries, all Guarantied Obligations then due. All
payments made hereunder shall be made on the same basis as, and in accordance
with, subsection 2.4E of the Credit Agreement and shall be applied promptly from
time to time as provided in subsection 2.4D of the Credit Agreement.
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Section 2.4 Liability of Guarantors Absolute.
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Each Guarantor agrees that its obligations hereunder are irrevocable,
absolute, independent and unconditional and shall not be affected by any event,
condition or circumstance whatsoever including, without limitation, any which
constitutes, a legal or equitable discharge of the Company for the underlying
Guarantied Obligations or of any Guarantor of its guaranty hereunder or
otherwise of a guarantor or surety other than payment in full of the Guarantied
Obligations. In furtherance of the foregoing and without limiting the generality
thereof, each Guarantor agrees as follows:
(a) This Guaranty is a guaranty of payment when due and not of
collectibility. This Guaranty is a primary obligation of each Guarantor and not
merely a contract of surety.
(b) The obligations of each Guarantor hereunder are exclusive and
independent of (i) the obligations of the Company under the Loan Documents or
the Lender Interest Rate Agreements, (ii) the obligations of any other guarantor
(including any other Guarantor) of the obligations of the Company under the Loan
Documents or the Lender Interest Rate Agreements, and (iii) any security or
collateral for such obligations of the Company or any guaranties thereof,
whether granted by the Company, any Guarantor or any other Person; and a
separate action or actions may be brought and prosecuted against such Guarantor
whether or not any action is brought against the Company or any of such other
guarantors, security or collateral and whether or not the Company is joined in
any such action or actions.
(c) Payment by any Guarantor of a portion, but not all, of the Guarantied
Obligations shall in no way limit, affect, modify or abridge any Guarantor's
liability for any portion of the Guarantied Obligations which has not been paid
or performed. Without limiting the generality of the foregoing, if the
Administrative Agent or any Beneficiary is awarded a judgment in any suit
brought to enforce the obligations of any Guarantor in respect of the Guarantied
Obligations then, to the maximum extent permitted by applicable law, such
judgment shall not be deemed to release such Guarantor from its obligation to
pay the portion of the Guarantied Obligations that is not the subject of such
suit, and such judgment shall not, except to the extent satisfied by such
Guarantor, limit, affect, modify or abridge any other Guarantor's liability
hereunder in respect of the Guarantied Obligations.
(d) Any Beneficiary, upon such terms as it deems appropriate, without
notice, demand, consent or incurring responsibility to any Guarantor and without
affecting the validity or enforceability of this Guaranty or giving rise to any
reduction, limitation, impairment, discharge or termination of any Guarantor's
obligations or liability hereunder, from time to time may (i) renew, alter,
extend, accelerate, increase the rate of interest on or otherwise change or
modify the time, place, manner or terms of payment of the Guarantied
Obligations; (ii) settle, compromise, release or discharge, or accept or refuse
any offer of performance with respect to, or substitutions for, the Guarantied
Obligations or any agreement relating thereto and/or subordinate the payment of
the same to the payment of any other obligations; (iii) request and accept other
guaranties of the Guarantied Obligations and take and hold security for the
payment of this Guaranty or the Guarantied Obligations; (iv) release, surrender,
exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or
modify, with or without consideration, any security for payment of the
Guarantied Obligations, any other guaranties of the Guarantied Obligations, or
any other obligation of any Person (including any other Guarantor) with respect
to the Guarantied Obligations; (v) sell, exchange, release, surrender, realize
or foreclose, enforce
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and apply or otherwise deal with in any manner and in any order any security now
or hereafter held by or on behalf of, or for the benefit of, such Beneficiary in
respect of this Guaranty or the Guarantied Obligations; (vi) apply any sums by
whomsoever paid or howsoever realized to any of the Guarantied Obligations;
(vii) consent to or waive any breach of, or any act, omission or default under,
any of the Loan Documents, the Lender Interest Rate Agreements or any of the
instruments or agreements in connection therewith, or otherwise amend, modify or
supplement any of the Loan Documents, the Lender Interest Rate Agreements or any
of the instruments or agreements in connection therewith; and (viii) exercise or
refrain from exercising any other rights available to it under the Loan
Documents or the Lender Interest Rate Agreements.
(e) This Guaranty and the obligations of the Guarantors hereunder shall be
valid and enforceable and shall not be subject to any reduction, limitation,
impairment, discharge or termination for any reason (other than payment in full
of the Guarantied Obligations), including, without limitation, the occurrence of
any of the following, whether or not any Guarantor shall have had notice or
knowledge of any of them: (i) any failure or omission to assert or enforce, or
agreement or election not to assert or enforce, or the stay or enjoining, by
order of court, by operation of law or otherwise, of the exercise or enforcement
of, any claim or demand or any right, power or remedy (whether arising under the
Loan Documents, the Lender Interest Rate Agreements, at law, in equity or
otherwise) with respect to the Guarantied Obligations or any agreement or
instrument relating thereto, or with respect to any other guaranty of, or
security for the payment of, the Guarantied Obligations; (ii) any rescission,
waiver, amendment or modification of, or any consent to departure from, any of
the terms or provisions (including, without limitation, provisions relating to
events of default) of the Credit Agreement, any of the other Loan Documents, any
of the Lender Interest Rate Agreements or any agreement or instrument relating
thereto, or of any other guaranty or security for the Guarantied Obligations, in
each case whether or not in accordance with the terms of the Credit Agreement or
such Loan Document, such Lender Interest Rate Agreement or any agreement
relating to such other guaranty or security; (iii) the application of payments
received from any source (other than payments received pursuant to other Loan
Documents or any Lender Interest Rate Agreements or from the proceeds of any
security for the Guarantied Obligations) to the payment of indebtedness other
than the Guarantied Obligations, even though any Beneficiary might have elected
to apply such payment to any part or all of the Guarantied Obligations; (iv)
except as permitted pursuant to subsection 7.7 of the Credit Agreement, any
Beneficiary's consent to the change, reorganization or termination of the
corporate structure or existence of the Company or any of its Subsidiaries and
to any corresponding restructuring of the Guarantied Obligations; (v) any
failure to perfect or continue perfection of a security interest in any
collateral which secures any of the Guarantied Obligations; (vi) any defenses,
set-offs or counterclaims which the Company, any Guarantor or any other Person
may allege or assert against any Beneficiary in respect of the Guarantied
Obligations, including, but not limited to, failure of consideration, breach of
warranty, payment, statute of frauds, statute of limitations, accord and
satisfaction and usury; and (vii) any other act or thing or omission, or delay
to do any other act or thing, which may or might in any manner or to any extent
vary the risk of any Guarantor as an obligor in respect of the Guarantied
Obligations.
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Section 2.5 Waivers by Guarantors.
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Each Guarantor hereby waives, for the benefit of the Beneficiaries:
(a) any right to require any Beneficiary, as a condition of payment by such
Guarantor, to (i) proceed against the Company, any other guarantor (including
any other Guarantor) of the Guarantied Obligations or any other Person, (ii)
proceed against or exhaust any security held from the Company, any such other
guarantor or any other Person, (iii) proceed against or have resort to any
balance of any deposit account or credit on the books of any Beneficiary in
favor of the Company or any other Person, or (iv) pursue any other remedy in the
power of any Beneficiary whatsoever;
(b) any defense based on or arising out of the Company or any other
guarantor (including any other Guarantor) or any other Person, including,
without limitation, any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of the Company, any other guarantor
(including any other Guarantor) or any other Person, any defense based on or
arising out of the lack of validity or the unenforceability of the Guarantied
Obligations or any agreement or instrument relating thereto or by reason of the
cessation of the liability of the Company from any cause other than payment in
full of the Guarantied Obligations;
(c) any defense based upon any statute or rule of law which provides that
the obligation of a surety must be neither larger in amount nor in other
respects more burdensome than that of the principal;
(d) (i) any principles or provisions of law, statutory or otherwise, which
are or might be in conflict with the terms of this Guaranty, (ii) the benefit of
any statute of limitations affecting such Guarantor's liability hereunder or the
enforcement hereof, (iii) any rights to set-offs, recoupments and counterclaims,
and (iv) any requirement that any Beneficiary protect, secure, perfect or insure
any security interest or lien or any property subject thereto; and
(e) promptness, diligence, notices, demands, presentments, protests,
notices of protest, notices of dishonor and notices of any action or inaction,
including acceptance of this Guaranty, notices of default under the Credit
Agreement, any other Loan Document, the Lender Interest Rate Agreements or any
agreement or instrument related thereto, notices of any renewal, extension or
modification of the Guarantied Obligations or any agreement related thereto,
notices of any extension of credit to Company, notices of the existence,
creation or incurrence of any additional Indebtedness and notices of any of the
matters referred to in subsection 2.4 and any right to consent to any thereof.
Section 2.6 Guarantors' Rights of Subrogation, Contribution, etc.
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Until the Guarantied Obligations (other than indemnification obligations
not due and payable) have been satisfied or paid in full and the Commitments
terminated and all Letters of Credit shall have expired or been canceled, each
Guarantor hereby waives and agrees that it shall not assert or seek or be
entitled to any claim, right or remedy, direct or indirect, that such Guarantor
now has or may hereafter have against the Company or any of its assets in
connection with this Guaranty or the performance by such Guarantor of its
obligations hereunder, in each case whether such claim, right or remedy arises
in equity, under contract, by statute, under common law or otherwise and
including, without limitation, (a) any right of subrogation, reimbursement,
contribution or indemnification that such Guarantor now has or may hereafter
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have against the Company with respect to the Guarantied Obligations, (b) any
right to enforce, or to participate in, any claim, right or remedy that any
Beneficiary now has or may hereafter have against the Company and (c) any
benefit of, and any right to participate in, any collateral or security now or
hereafter held by, on behalf of or for any Beneficiary. In addition, until the
Guarantied Obligations (other than indemnification obligations not due and
payable) shall have been satisfied or paid in full and the Commitments shall
have terminated and all Letters of Credit shall have expired or been canceled,
each Guarantor shall withhold exercise of any right of contribution such
Guarantor may have against any other guarantor (including any other Guarantor)
of the Guarantied Obligations (including, without limitation, any such right of
contribution under subsection 2.2(b)). Each Guarantor further agrees that, to
the extent the waiver or agreement to withhold the exercise of its rights of
subrogation, reimbursement, indemnification and contribution with respect to the
Guarantied Obligations as set forth herein is found by a court of competent
jurisdiction to be void or voidable for any reason, any rights of subrogation,
reimbursement, contribution or indemnification such Guarantor may have against
the Company, any such other guarantor or against any collateral or security,
shall be junior and subordinate to any rights any Beneficiary may have against
the Company, to all right, title and interest any Beneficiary may have in any
such collateral or security, and to any right any Beneficiary may have against
such other guarantor. If any amount shall be paid to any Guarantor on account of
any such subrogation, reimbursement, indemnification or contribution rights with
respect to the Guarantied Obligations at any time when all of the Guarantied
Obligations (other than indemnification obligations not due and payable) shall
not have been satisfied or paid in full and the Commitments shall not have
terminated and all Letters of Credit shall have not expired or been canceled,
such amount shall be held in trust for and on behalf of Beneficiaries and shall
forthwith be paid over to the Administrative Agent for the benefit of
Beneficiaries to be credited and applied against the Guarantied Obligations,
whether matured or unmatured, in accordance with the terms hereof.
Section 2.7 Subordination of Other Obligations.
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Any indebtedness of the Company now or hereafter held by any Guarantor (the
"Obligee Guarantor") is hereby subordinated in right of payment to the
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Guarantied Obligations, and any such indebtedness collected or received by the
Obligee Guarantor after an Event of Default has occurred and is continuing shall
be held in trust for the Administrative Agent on behalf of Beneficiaries and
shall forthwith be paid over to the Administrative Agent for the benefit of
Beneficiaries to be credited and applied against the Guarantied Obligations but
without affecting, impairing or limiting in any manner the liability of the
Obligee Guarantor under any other provision of this Guaranty.
Section 2.8 Expenses.
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Guarantors jointly and severally agree to pay, or cause to be paid,
promptly upon written demand, and to save the Beneficiaries harmless against
liability for, any and all reasonable costs and reasonable expenses (including
reasonable fees and disbursements of counsel and allocated costs of internal
counsel) incurred or expended by the Administrative Agent or any Beneficiary in
connection with this Guaranty, including, without limitation, any enforcement,
or, if requested by or for the benefit of the Company or any Guarantor any
amendment, consent or waiver.
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Section 2.9 Continuing Guaranty.
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This Guaranty is a continuing guaranty and shall remain in effect until all
of the Guarantied Obligations (other than indemnification obligations not due
and payable) shall have been satisfied or paid in full and the Commitments shall
have terminated and all Letters of Credit shall have expired or been canceled.
Each Guarantor hereby irrevocably waives any right to revoke this Guaranty as to
future transactions giving rise to any Guarantied Obligations.
Section 2.10 Authority of Guarantors or Company.
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It is not necessary for any Beneficiary to inquire into the capacity or
powers of any Guarantor or the Company or the officers, directors or any agents
acting or purporting to act on behalf of any of them.
Section 2.11 Financial Condition of Company.
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Any Loans may be granted to the Company or continued from time to time, and
any Lender Interest Rate Agreement may be entered into from time to time, in
each case without notice to or authorization from any Guarantor regardless of
the financial or other condition of the Company at the time of any such grant or
continuation or at the time such Lender Interest Rate Agreement is entered into,
as the case may be. No Beneficiary shall have any obligation to disclose or
discuss with any Guarantor its assessment, or any Guarantor's assessment, of the
financial condition of the Company. Each Guarantor has adequate means to obtain
information from the Company on a continuing basis concerning the financial
condition of the Company and its ability to perform its obligations under the
Loan Documents and the Lender Interest Rate Agreements, and each Guarantor
assumes the responsibility for being and keeping informed of the financial
condition of the Company and of all circumstances bearing upon the risk of
nonpayment of the Guarantied Obligations. Each Guarantor hereby waives and
relinquishes any duty on the part of any Beneficiary to disclose any matter,
fact or thing relating to the business, operations or conditions of the Company
now known or hereafter known by any Beneficiary.
Section 2.12 Rights Cumulative.
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The rights, powers, privileges and remedies given to the Administrative
Agent for the ratable benefit of the Beneficiaries by this Guaranty are
cumulative and shall be in addition to and independent of, and may be exercised
singly or concurrently, and are exclusive of, all rights, powers and remedies
given to the Agents and the Beneficiaries by virtue of any statute or rule of
law or in any of the other Loan Documents, any of the Lender Interest Rate
Agreements or any agreement between any Guarantor and any Beneficiary or
Beneficiaries or between the Company and any Beneficiary or Beneficiaries. Any
forbearance, indulgence or failure to exercise, and any delay by the
Administrative Agent or any Beneficiary in exercising, any right, power,
privilege or remedy hereunder shall not impair any such right, power, privilege
or remedy or be construed to be a waiver thereof nor shall it preclude the
future or further exercise of any such or other right, power, privilege or
remedy. No single or partial exercise of any right, power, privilege or remedy
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power, privilege or remedy. A waiver by the Administrative
Agent or any Beneficiary of any right, power, privilege or remedy hereunder on
any one occasion shall not be construed to be
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a bar to any right, power, privilege or remedy which the Administrative Agent or
any Beneficiary would otherwise have on any future occasion. No notice to or
demand on any Guarantor in any case shall entitle such Guarantor or any other
Guarantor to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of any Beneficiary to any
other or further action in any circumstances without notice or demand.
Section 2.13 Bankruptcy; Post-Petition Interest; Reinstatement of
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Guaranty.
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(a) So long as any Guarantied Obligations (other than indemnification
obligations not due and payable) remain outstanding, no Guarantor shall, without
the prior written consent of the Administrative Agent acting pursuant to the
instructions of Requisite Obligees, commence or join with any other Person in
commencing any bankruptcy, reorganization or insolvency proceedings of, or
against, the Company. The obligations of the Guarantors under this Guaranty
shall not be reduced, limited, impaired, discharged, deferred, suspended or
terminated by any proceeding, voluntary or involuntary, involving the
bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement
of the Company, or by any defense which the Company may have by reason of the
order, decree or decision of any court or administrative body resulting from any
such proceeding.
(b) To the extent permitted by applicable law, each Guarantor acknowledges
and agrees that any interest on any portion of the Guarantied Obligations which
accrues after the commencement of any proceeding referred to in clause (a) above
(or, if interest on any portion of the Guarantied Obligations ceases to accrue
by operation of law by reason of the commencement of said proceeding, such
interest as would have accrued on such portion of the Guarantied Obligations if
said proceedings had not been commenced) shall be included in the Guarantied
Obligations, because it is the intention of the Guarantors and the Beneficiaries
that the Guarantied Obligations which are guarantied by the Guarantors pursuant
to this Guaranty should be determined without regard to any rule of law or order
which may relieve the Company of any portion of such Guarantied Obligations. The
Guarantors will permit any trustee in bankruptcy, receiver, debtor in
possession, assignee for the benefit of creditors or similar person to pay the
Administrative Agent, or allow the claim of the Administrative Agent in respect
of, any such interest accruing after the date on which such proceeding is
commenced.
(c) In the event that all or any portion of the Guarantied Obligations are
paid by any Person or Persons, the obligations of Guarantors hereunder shall be
reinstated but only in the event that all or any part of such payment(s) are
rescinded or recovered directly or indirectly from any Beneficiary, or otherwise
are repaid, returned or restored by, any Agent or any Beneficiary for the
following (or similar) reasons (i) the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Company or any Guarantor, (ii) the
appointment of a receiver, intervenor, conservator, trustee or similar officer
of, for or on behalf of the Company or any Guarantor or any of its property,
(iii) any judgment, decree or order of any court or administrative body having
jurisdiction over any Beneficiary or any of its property, or (iv) any settlement
or compromise of any such claim effected by such Beneficiary with any such
claimant (including the Company or any Guarantor)), and any such payments which
are so rescinded or recovered shall constitute Guarantied Obligations for all
purposes under this Guaranty and each Guarantor shall be and remain liable
hereunder for the amount so repaid, returned, restored,
10
rescinded or recovered to the same extent as if such amount had never originally
been received by any such Beneficiary.
Section 2.14 Set Off.
-------
In addition to any other rights any Beneficiary may have under law or in
equity, if any amount shall at any time be due and owing by any Guarantor to any
Beneficiary under this Guaranty, such Beneficiary is authorized at any time or
from time to time upon the occurrence and during the continuation of any Event
of Default or any payment default under any Lender Interest Rate Agreement,
without notice to any Guarantor or any other Person (any such notice being
hereby expressly waived), to set off and to appropriate and to apply any and all
deposits (general or special, including, but not limited to, indebtedness
evidenced by certificates of deposit, whether matured or unmatured) and any
other indebtedness of such Beneficiary owing to such Guarantor and any other
property of such Guarantor held by any Beneficiary to, or for the credit or the
account of, such Guarantor against and on account of the Guarantied Obligations
and liabilities of such Guarantor to any Beneficiary under this Guaranty.
Section 2.15 Discharge of Guaranty Upon Sale of Guarantor.
--------------------------------------------
If all of the stock or assets of any Subsidiary Guarantor or any of its
successors in interest under this Guaranty shall be sold or otherwise disposed
of (including by merger or consolidation) in an Asset Sale permitted by, and in
compliance with the provisions of subsections 7.7 and 2.4B(iii)(a) of the Credit
Agreement or otherwise consented to by Requisite Lenders, the guaranty of such
Subsidiary Guarantor or such successor in interest, as the case may be,
hereunder shall automatically be discharged and released without any further
action by any Beneficiary or any other Person effective as of the time of such
Asset Sale.
ARTICLE III
MISCELLANEOUS
Section 3.1 Survival of Warranties.
----------------------
All agreements, representations and warranties made herein shall survive
the execution and delivery of this Guaranty and the other Loan Documents and the
Lender Interest Rate Agreements and any increase in the Commitments under the
Credit Agreement.
Section 3.2 Notices.
--------
Any notice or other communication herein required or permitted to be given
shall be in writing and may be personally served, telecopied, telexed or sent by
United States mail or courier service and shall be deemed to have been given
when delivered in person or by courier service, upon receipt of telecopy or
telex, or four (4) Business Days after depositing it in the United States mail,
registered or certified, with postage prepaid and properly addressed. For the
purposes hereof, the address of each party hereto shall be as provided in
subsection 10.8 of the Credit Agreement or as set forth under such party's name
on the signature pages hereof or, as to any party, such other address as shall
be designated by such party in a written notice delivered to the other parties
hereto.
11
Section 3.3 Severability.
------------
In case any provision in or obligation under this Guaranty shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
Section 3.4 Amendments and Waivers.
----------------------
No amendment, modification, termination or waiver of any provision of this
Guaranty, and no consent to any departure by any Guarantor therefrom, shall in
any event be effective without the written concurrence of the Administrative
Agent (with the consent or at the direction of the Requisite Obligees) and, in
the case of any such amendment or modification, each Guarantor against whom
enforcement of such amendment or modification is sought. Any such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.
Section 3.5 Headings.
--------
Section and subsection headings in this Guaranty are included herein for
convenience of reference only and shall not constitute a part of this Guaranty
for any other purpose or be given any substantive effect.
Section 3.6 Applicable Law; Rules of Construction.
-------------------------------------
THIS GUARANTY SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. The rules of construction set forth in
subsection 1.3 of the Credit Agreement shall be applicable to this Guaranty
mutatis mutandis.
Section 3.7 Successors and Assigns.
----------------------
This Guaranty is a continuing guaranty and shall be binding upon each
Guarantor and its respective successors and assigns. This Guaranty shall inure
to the benefit of the Beneficiaries and their respective successors and assigns.
No Guarantor shall assign this Guaranty or any of the rights or obligations of
such Guarantor hereunder without the prior written consent of all Lenders.
Subject to subsection 10.1 of the Credit Agreement, any Beneficiary may, without
notice or consent, assign its interest in this Guaranty in whole or in part. The
terms and provisions of this Guaranty shall inure to the benefit of any
transferee or assignee of any Loan, and in the event of such transfer or
assignment the rights and privileges herein conferred upon such Beneficiary
shall automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions hereof.
Section 3.8 Consent to Jurisdiction and Service of Process.
----------------------------------------------
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GUARANTOR ARISING OUT OF OR
RELATING TO THIS GUARANTY, OR ANY OBLIGATIONS HEREUNDER, MAY BE BROUGHT IN ANY
STATE OR FEDERAL COURT OF
12
COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING
AND DELIVERING THIS GUARANTY, EACH GUARANTOR IRREVOCABLY (I) ACCEPTS GENERALLY
AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (II)
WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (III) AGREES THAT SERVICE OF ALL
PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO SUCH GUARANTOR AT ITS ADDRESS
PROVIDED IN ACCORDANCE WITH SUBSECTION 3.2; (IV) AGREES THAT SERVICE AS PROVIDED
IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER SUCH
GUARANTOR IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; (V) AGREES THAT BENEFICIARIES
RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
BRING PROCEEDINGS AGAINST SUCH GUARANTOR IN THE COURTS OF ANY OTHER
JURISDICTION; AND (VI) AGREES THAT THE PROVISIONS OF THIS SUBSECTION 3.8
RELATING TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE
FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402
OR OTHERWISE.
Section 3.9 Waiver of Trial by Jury.
-----------------------
EACH GUARANTOR AND, BY ITS ACCEPTANCE OF THE BENEFITS HEREOF, EACH
BENEFICIARY HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY. EACH
GUARANTOR WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS WAIVER WITH ITS
LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE,
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A
MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 3.9 AND EXECUTED
BY THE ADMINISTRATIVE AGENT AND EACH GUARANTOR), AND THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
GUARANTY. In the event of litigation, this Guaranty may be filed as a written
consent to a trial by the court.
Section 3.10 No Other Writing.
----------------
This writing is intended by the Guarantors and the Beneficiaries as the
final expression of this Guaranty and is also intended as a complete and
exclusive statement of the terms of their agreement with respect to the matters
covered hereby. No course of dealing, course of performance or trade usage, and
no parol evidence of any nature, shall be used to supplement or modify any terms
of this Guaranty. There are no conditions to the full effectiveness of this
Guaranty.
13
Section 3.11 Further Assurances.
------------------
At any time or from time to time, upon the reasonable request of the
Administrative Agent, Guarantors shall execute and deliver such further
documents and do such other acts and things as the Administrative Agent may
reasonably request in order to effect fully the purposes of this Guaranty.
Section 3.12 Additional Guarantors.
---------------------
The initial Guarantors hereunder shall be ChipPAC and all of the
Subsidiaries of ChipPAC as on the date hereof (other than the Company, ChipPAC
Shanghai I and ChipPAC Shanghai II). From time to time subsequent to the date
hereof, additional Subsidiaries of ChipPAC may (or shall if required pursuant to
subsection 6.9 of the Credit Agreement) become parties hereto as additional
Guarantors (each an "Additional Guarantor"), by executing a counterpart of this
--------------------
Guaranty. Upon delivery of any such counterpart to the Administrative Agent,
notice of which is hereby waived by each of the Guarantors, each such Additional
Guarantor shall be a Guarantor and shall be as fully a party hereto as if such
Additional Guarantor were an original signatory hereof. Each Guarantor expressly
agrees that its obligations arising hereunder shall not be affected or
diminished by the addition or release of any other Guarantor hereunder, nor by
any election of the Administrative Agent not to cause any Subsidiary of ChipPAC
to become an Additional Guarantor hereunder. This Guaranty shall be fully
effective as to any Guarantor that is or becomes a party hereto regardless of
whether any other Person becomes or fails to become or ceases to be a Guarantor
hereunder.
Section 3.13 Counterparts; Effectiveness.
---------------------------
This Guaranty may be executed in any number of counterparts and by the
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed to be an original for all purposes; but
all such counterparts together shall constitute but one and the same instrument.
This Guaranty shall become effective as to each Guarantor upon the execution of
a counterpart hereof by such Guarantor (whether or not a counterpart hereof
shall have been executed by any other Guarantor) and receipt by the
Administrative Agent (or its counsel or other representatives) of written or
telephonic notification of such execution and authorization or an original or
copy of an executed counterpart hereof.
Section 3.14 Authority of Administrative Agent.
---------------------------------
Each Guarantor acknowledges that the rights and responsibilities of the
Administrative Agent under this Guaranty with respect to any action taken by the
Administrative Agent or the exercise or non-exercise by the Administrative Agent
of any option, voting right, request, judgment or other right or remedy provided
for herein or resulting or arising out of this Guaranty shall, as between the
Administrative Agent and the Beneficiaries, be governed by the Credit Agreement
and by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Administrative Agent and the Guarantor, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Beneficiaries
14
with full and valid authority so to act or refrain from acting, and no Guarantor
shall be under any obligation, or entitlement, to make any inquiry respecting
such authority.
Section 3.15 Documents.
---------
Each Guarantor acknowledges that an executed (or conformed) copy of each of
the Loan Documents and the Lender Interest Rate Agreements has been made
available to its principal executive officers and such officers are familiar
with the contents thereof.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, each of the undersigned Guarantors has caused this
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of the date first written above.
CHIPPAC, INC.
By: /s/ Gary Breton
------------------------------
Name: Gary Breton
Title: Vice President
Notice Address:
311 Coronado Drive
Santa Clara, CA 95054
Attention: Chief Financial Officer
Telephone: (408) 486-5900
Facsimile: (408) 486-5911
S-1
Each of the entities listed on
Schedule A annexed hereto
By: /s/ P.J. Kim
------------------------------
on behalf of each of the entities listed on
Schedule A annexed hereto
Name: P.J. Kim
Title: Secretary and Power of Attorney
Notice Address: See Schedule A
S-2
IN WITNESS WHEREOF, the undersigned Additional Guarantor has caused this
Guaranty to be duly executed and delivered by its officer thereunto duly
authorized as of October 12, 2001.
CHIPPAC MALAYSIA, SDN. BHD.
By: /s/ Teh Chin Bin
---------------------------------------
Name: Teh Chin Bin
Title: President and Managing Director
Notice Address:
ChipPAC Malaysia Sdn. Bhd.
73 Lorong enggang
Ulu Klang Free Trade Zone
54200 Kuala Lumpur
Malaysia
S-3
SCHEDULE A
Name Notice Address for Each Guarantor
- ---- ---------------------------------
ChipPAC, Inc. 3151 Coronado Drive Santa Clara, CA 95054
ChipPAC (Barbados) Ltd. Chancery House, High Street Bridgetown, Barbados, West Indies
ChipPAC Limited c/o HWR Services Limited
Craigmuir Chambers P.O. Box 71 Road Town,
Tortola, British Virgin Islands
ChipPAC International c/o HWR Services Limited
Company Limited Craigmuir Chambers P.O. Box 71 Road Town,
Tortola, British Virgin Islands
ChipPAC Luxembourg 16 rue Eugene Ruppert B.P. 1443 L-1014 S.a.R.L. Luxembourg
ChipPAC Liquidity Limited Wesselenyi u. 16 H-1077 Budapest, Hungary Management Hungary
Liability Company San 136-1, Ami-ri, Bubal-EUB, Ischon-Si
ChipPAC Korea Company Ltd. Kyoungki-Do 467-701 Korea
A-1