Exhibit 99.1



THIS SECOND AMENDING AGREEMENT dated as of the 17th day of August, 2005



BETWEEN:



SMTC MANUFACTURING CORPORATION OF CALIFORNIA

SMTC MANUFACTURING CORPORATION OF WISCONSIN

SMTC MANUFACTURING CORPORATION OF MASSACHUSETTS

SMTC MEX HOLDINGS, INC.



collectively, as US Borrowers



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CONGRESS FINANCIAL CORPORATION (CENTRAL)



as Lender and US Collateral Agent



WHEREAS US Borrowers, Lender and US Collateral Agent entered into a loan agreement dated June 1, 2004 (the Loan Agreement)
pursuant to which certain credit facilities were established in favour of US Borrowers;



AND WHEREAS US Borrowers, Lender and US Collateral Agent entered into a first amending agreement in respect of the Loan Agreement dated March 10, 2005 (the Original Amending Agreement)
amending certain terms and conditions of the Loan Agreement;



AND WHEREAS the US Borrowers, Lender and US Collateral Agent entered into a first amending agreement in respect of the Loan Agreement dated March 31, 2005 (the First Amending Agreement) amending certain terms and
conditions of the Loan Agreement and providing that the terms of the First Amending Agreement supercede and replace, in its entirety, the Original Amending Agreement to the effect that the Original Amending Agreement is deemed to have had no force
and effect and to the same extent as if it had never been executed and delivered;



AND WHEREAS Lender and US Collateral Agent have executed a consent and release letter dated July 4, 2005 (the Consent) providing, among other things, their consent to the sale by SMTC
Manufacturing Corporation of Wisconsin to SMT Engineering, LLC of certain assets;



AND WHEREAS the parties wish to enter into this agreement to amend certain terms and conditions of the Loan Agreement and the First Amending Agreement;



NOW THEREFORE THIS SECOND AMENDING AGREEMENT WITNESSES THAT in
consideration of the covenants and agreements contained herein and for other good and valuable consideration, the parties hereto agree to amend the Loan Agreement and the First Amending Agreement as provided herein:



|Section 1 | General
|--------- | -------



In this Second Amending Agreement, unless otherwise defined or the context otherwise requires, all capitalized terms shall have the respective meanings
specified in the Loan Agreement.



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|Section 2 | To be Read with Loan Agreement
|--------- | ------------------------------



This Second Amending Agreement is an amendment to the Loan Agreement and the First Amending Agreement. Unless the context of this Second Amending
Agreement otherwise requires, the Loan Agreement, the First Amending Agreement, the Consent and this Second Amending Agreement shall be read together and shall have effect as if the provisions of the Loan Agreement, the First Amending Agreement, the
Consent and this Second Amending Agreement were contained in one agreement. The term Agreement when used in the Loan Agreement means the Loan Agreement as amended by the First Amending Agreement, the Consent and this Second
Amending Agreement, together with all amendments, modifications, supplements, extensions, renewals, restatements, replacements and novations thereof from time to time.



|Section 3 | No Novations
|--------- | ------------



Nothing in this Second Amending Agreement, nor in the Loan Agreement when read together with the First Amending Agreement, the Consent and this Second
Amending Agreement, shall constitute a novation, payment, re-advance or reduction or termination in respect of any Obligations.



|Section 4 | Amendments to Loan Agreement
|--------- | ----------------------------



Section 1 (Definitions) of the Loan Agreement is amended by adding the following definition in its proper alphabetical order:



1.98B Suspension Notice Period



Suspension Notice Period shall have the
meaning set forth in Section 6.3(b) hereof.



|Section 5 | Amendments to First Amending Agreement
|--------- | --------------------------------------



Section 4(c) of the First Amending Agreement is hereby deleted and replaced with the following:



| | (c) | Section 6.3 (Collection of Accounts) of the Loan Agreement is hereby deleted and replaced with the following:
| | ---- | ---------------------------------------------------------------------------------------------------------------



6.3 Collection of Accounts



| | (a) | Each US Borrower shall establish and maintain, at its expense, blocked accounts or lockboxes and related blocked accounts (in either case,
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| | Blocked Accounts) as Lender may specify, and Lender may establish and maintain bank accounts of Lender (Payment
Accounts) in each case with such banks as are acceptable to Lender into which US Borrowers shall, in accordance with Lenders instructions, promptly deposit, and direct their account debtors that remit payments by electronic funds
transfers to directly remit, all payments on Accounts and all payments constituting proceeds of Inventory or other Collateral in the identical form in which such payments are made, whether by cash, check or other manner. The banks at which the
Blocked Accounts are established shall enter into deposit account control agreements (each, a Deposit Account Control Agreement), in form and substance satisfactory to Lender, acting reasonably, providing that all items received
or deposited in the Blocked Accounts are the property of Lender, that the depository bank has no Lien upon, or right to set-off against, the Blocked Accounts, the items received for deposit therein, or the funds from time to time on deposit therein
and that the depository bank will wire, or otherwise transfer, in immediately available funds, on a daily basis, all funds received or deposited into the Blocked Accounts to the Payment Accounts or such other bank account of Lender as Lender may
from time to time designate for such purpose. Each US Borrower agrees that all payments made to such Blocked Accounts or Payment Accounts or other funds received and collected by Lender and/or US Collateral Agent, whether on the Accounts or as
proceeds of Inventory or other Collateral or otherwise, shall be the property of Lender.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | Notwithstanding Section 6.3(a) above, Lender, at the request of all US Borrowers, shall provide US Borrowers and their respective Subsidiaries (if applicable) or HTM with dominion
and control over the Blocked Accounts (and other accounts of such Subsidiaries, if applicable, or HTM) by suspending (the Suspension) the operation of certain provisions of such Deposit Account Control Agreements by executing and
delivering a notice (each, a Cash Dominion and Control Release Notice), in substantially the form attached as Schedule 6.3 hereto and in form and substance satisfactory to Lender, to the banks party to such Deposit Account Control
Agreements provided:
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| | (i) | US Borrowers provide Lender with twenty (20) days prior written notice that it requires a period of Suspension (a Suspension Notice Period);
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | prior to the effectiveness of such Suspension and during the Suspension Notice Period, Lender or its designees shall be entitled solely to confirm that, at US
Borrowers cost and expense, the amount of Total Excess Availability is not less than the greater of (A) US$2,500,000 or (B) twenty-five (25%) percent of the sum of the then outstanding and unpaid Revolving Loans under this Agreement and the
Revolving Loans (as defined in the Canadian
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | Loan Agreement) under the terms and conditions as existed immediately prior to the Suspension Notice Period; and
| | ----------------------------------------------------------------------------------------------------------------



| | (iii) | during such Suspension, the amount of Total Excess Availability is not less than the greater of (A) US$2,500,000 or (B) twenty-five (25%) percent of the sum of the then outstanding
and unpaid Revolving Loans under this Agreement and the Revolving Loans (as defined in the Canadian Loan Agreement), in either case, for a period in excess of three (3) consecutive Business Days.
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



US Borrowers and Lender agree that a Suspension shall be in effect (A) upon
Lender confirming that the Total Excess Availability test set out in subparagraph (b)(ii) immediately above has been satisfied, (B) upon execution and delivery of the applicable Cash Dominion and Control Release Notice by Lender, the applicable bank
and each US Borrower and (C) only so long as (1) the Total Excess Availability test set out in subparagraph (b)(iii) immediately above is satisfied and (2) no Event of Default exists or has occurred and is continuing. For greater certainty, each US
Borrower acknowledges and agrees that any Suspension shall immediately be terminated, and Lender shall immediately have dominion and control over the Blocked Accounts pursuant to the Deposit Account Control Agreements, at any time that the Total
Excess Availability test set out in subparagraph (b)(iii) immediately above is not satisfied or an Event of Default exists or has occurred and is continuing and Lender may, but shall not be obligated, to provide notice to the bank party to the
applicable Deposit Account Control Agreement notifying it of the termination of such Suspension.



| | (c) | For purposes of calculating the amount of the Loans available to US Borrowers, such payments referred to in Section 6.3(a) above will be applied (conditional upon
final collection) to the Obligations on the Business Day of receipt by Lender of immediately available funds in the Payment Account provided such payments and notice thereof are received in accordance with Lenders usual and customary practices
as in effect from time to time and within sufficient time to credit applicable US Borrowers loan account on such day, and if not, then on the next Business Day. For the purposes of calculating interest on the Obligations, such payments or
other funds received will be applied (conditional upon final collection) to the Obligations on the date of receipt of immediately available funds by Lender in the Payment Accounts provided such payments or other funds and notice thereof are received
in accordance with Lenders usual and customary practices as in effect from time to time and within sufficient time to credit applicable US Borrowers loan account on such day, and if not, then on the next Business Day. If Lender receives
funds in a Payment Account at any time at which no Obligations are outstanding or in excess of such outstanding Obligations, Lender shall transfer such funds to applicable US Borrower at such account as such US
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| | Borrower may direct, provided that such US Borrower shall, at Lenders request, deposit such funds to an account maintained at the bank at which the
Payment Accounts are maintained and, prior to such transfer, shall execute and deliver to US Collateral Agent a cash collateral agreement in form and substance satisfactory to US Collateral Agent providing to US Collateral Agent a first priority
Lien over such account.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | Except during a Suspension, US Borrowers and all of their affiliates, Subsidiaries, shareholders, directors, employees or agents shall, acting as trustee for Lender, receive, as the
property of Lender, any monies, checks, notes, drafts or any other payment relating to and/or proceeds of Accounts or other Collateral which come into their possession or under their control and immediately upon receipt thereof, shall deposit or
cause the same to be deposited in the Blocked Accounts or the Payment Accounts, or remit the same or cause the same to be remitted, in kind, to Lender. In no event, other than during a Suspension, shall the same be commingled with a US
Borrowers own funds. Each US Borrower agrees to reimburse Lender on demand for any amounts owed or paid to any bank at which a Blocked Account or Payment Account is established or any other bank or person involved in the transfer of funds to
or from the Blocked Accounts or the Payment Accounts arising out of Lenders payments to or indemnification of such bank or person. The obligation of each US Borrower to reimburse Lender for such amounts pursuant to this Section 6.3 shall
survive the termination or non-renewal of this Agreement.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|Section 6 | Representations and Warranties
|--------- | ------------------------------



In order to induce Lender to enter into this Second Amending Agreement, each US Borrower represents and warrants to Lender as follows, which
representations and warranties shall survive the execution and delivery hereof:



| | (a) | the representations and warranties set forth in Section 8 of the Loan Agreement continue to be true and correct as of the date hereof;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------



| | (b) | the execution, delivery and performance of this Second Amending Agreement and the transactions contemplated hereunder are all within each US Borrowers corporate powers, have
been duly authorized and are not in contravention of law or the terms of each US Borrowers certificate of incorporation, by-laws or other organizational documentation, or any indenture, agreement or undertaking to which a US Borrower is a
party or by which a US Borrower or its property is bound. Each US Borrower has duly executed and delivered this Second Amending Agreement. This Second Amending Agreement constitutes a legal, valid and binding obligation of each US Borrower,
enforceable against it by Lender and US Collateral Agent in accordance with its terms;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | no Event of Default exists; and
| | --- | -------------------------------



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| | (d) | each US Borrower is in compliance with the covenants contained in Section 6, Section 7 and Section 9 of the Loan Agreement.
| | --- | ---------------------------------------------------------------------------------------------------------------------------



|Section 7 | Conditions Precedent
|--------- | --------------------



This Second Amending Agreement shall not be effective until each of the following conditions has been met to the satisfaction of Lender or has been waived
in writing (in whole or in part) by Lender in its sole discretion:



| | (a) | Lender has received, in form and substance satisfactory to Lender, an original copy of each of the following documents:
| | --- | -----------------------------------------------------------------------------------------------------------------------



| | (i) | this Second Amending Agreement executed by each US Borrower and the other Obligors party hereto;
| | --- | ------------------------------------------------------------------------------------------------



| | (ii) | documentation in connection with corporate actions and proceedings which Lender may have requested in connection herewith, such documents where requested by Lender or its counsel to
be certified by appropriate corporate officers or governmental authorities;
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| | (iii) | certificate of incumbency executed by each US Borrower;
| | ----- | -------------------------------------------------------



| | (iv) | all consents, waivers, acknowledgements and other agreements from third parties which Lender may deem necessary or desirable in order to give effect to the provisions or purposes of
this Second Amending Agreement;
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (v) | originals or copies, as determined by Lender, of such other documents and instruments as are reasonably required by Lender, including all other documents listed on the closing
agenda relating to the transactions contemplated herein;
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| | (b) | US Borrowers have paid all fees, expenses and disbursements, including, without limitation, legal fees, incurred by or payable to Lender or US Collateral Agent in connection with
this Second Amending Agreement;
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| | (c) | all requisite corporate actions and proceedings in connection with this Second Amending Agreement shall have been completed;
| | --- | ----------------------------------------------------------------------------------------------------------------------------



| | (d) | no Event of Default exists; and
| | --- | -------------------------------



| | (e) | no material adverse change shall have occurred with respect to a US Borrower or any Obligor since the date of Lenders latest field examination and no change or event shall
have occurred which would have a material adverse effect on a US Borrower or any Obligor.
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|Section 8 | Expenses
|--------- | --------



US Borrowers shall pay all fees, expenses and disbursements including, without limitation, legal fees, incurred by or payable to Lender or US Collateral
Agent in connection with any confirmation of the amount of Total Excess Availability contemplated hereunder and the preparation, negotiation, completion, execution, delivery and review of this Second Amending Agreement and all other documents and
instruments arising therefrom and/or executed in connection therewith.



|Section 9 | Continuance of Loan Agreement and Security
|--------- | ------------------------------------------



The Loan Agreement, as changed, altered, amended or modified by the First Amending Agreement, the Consent and this Second Amending Agreement, shall be and
continue in full force and effect and is hereby confirmed and the rights and obligations of all parties thereunder shall not be affected or prejudiced in any manner except as specifically provided for in the First Amending Agreement, the Consent and
herein. It is agreed and confirmed that after giving effect to this Second Amending Agreement, all security delivered by US Borrowers secures the payment of all of the Obligations including, without limitation, the obligations arising under the Loan
Agreement, as amended by the terms of the First Amending Agreement, the Consent and the Second Amending Agreement.



|Section 10 | Counterparts
|---------- | ------------



This Second Amending Agreement may be executed in any number of separate original or facsimile counterparts, each of which shall be deemed an original and
all of said counterparts taken together shall be deemed to constitute one and the same instrument.



|Section 11 | Governing Law
|---------- | -------------



The validity, interpretation and enforcement of this Second Amending Agreement and any dispute arising out of the relationship between the parties hereto,
whether in contract, tort, equity or otherwise, shall be governed by the internal laws of the State of Illinois without giving effect to principles of conflicts of laws.



|Section 12 | Effective Date
|---------- | --------------



Notwithstanding the date of execution, the terms of this Second Amending Agreement are effective as of July 26, 2005.



[SIGNATURE PAGE FOLLOWS]



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IN WITNESS WHEREOF the parties hereto have executed this Second Amending Agreement as of the day and year first
above written.



|                                         |  |                                         |  |                                              |  |        |  |                  
|---------------------------------------- |  | --------------------------------------- |  | -------------------------------------------- |  | ------ |  | -----------------
|US COLLATERAL AGENT AND LENDER           |  |                                         |  | US BORROWER                                 
|                                         |  |                                        
|CONGRESS FINANCIAL CORPORATION (CENTRAL) |  |                                         |  | SMTC MANUFACTURING CORPORATION OF CALIFORNIA
|                                         |  |                                         |  |                                             
|By:                                      |  | /s/ Niall H. Hamilton                   |  |                                              |  | By:    |  | /s/ John Caldwell
|Name:                                    |  | Niall H. Hamilton                       |  |                                              |  | Name:  |  | John Caldwell    
|Title:                                   |  | Senior Vice President                   |  |                                              |  | Title: |  | President & CEO  
|                                         |  | Congress Financial Corporation (Canada) |  |                                              |  |        |  |                  
|                                         |  |                                        
|Address:                                 |  |                                         |  | Address:                                    
|                                         |  |                                        
|150 South Wacker Drive                   |  |                                         |  | 2302 Trade Zone Boulevard                   
|Chicago, Illinois 60606                  |  |                                         |  | San Jose, California                        
|                                         |  |                                         |  | USA 95131                                   
|                                         |  |                                        
|Fax: (312) 332-0424                      |  |                                         |  | Fax No: (408) 934-7101                      



|                                            |  |                   |  |                                                 |  |        |  |                  
|------------------------------------------- |  | ----------------- |  | ----------------------------------------------- |  | ------ |  | -----------------
|US BORROWER                                 |  |                   |  | US BORROWER                                    
|                                            |  |                  
|SMTC MANUFACTURING CORPORATION OF WISCONSIN |  |                   |  | SMTC MANUFACTURING CORPORATION OF MASSACHUSETTS
|                                            |  |                   |  |                                                
|By:                                         |  | /s/ John Caldwell |  |                                                 |  | By:    |  | /s/ John Caldwell
|Name:                                       |  | John Caldwell     |  |                                                 |  | Name:  |  | John Caldwell    
|Title:                                      |  | President & CEO   |  |                                                 |  | Title: |  | President & CEO  
|                                            |  |                  
|Address:                                    |  |                   |  | Address:                                       
|                                            |  |                  
|2222 E. Pensar Drive                        |  |                   |  | 109 Constitution Blvd.                         
|Appleton, Wisconsin                         |  |                   |  | Unit 160                                       
|USA                                         |  |                   |  | Franklin, Massachusetts                        
|                                            |  |                   |  | USA                                            
|                                            |  |                  
|Fax No: (920) 739-4830                      |  |                   |  | Fax No: (508) 520-9351                         



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|                        |  |                  
|----------------------- |  | -----------------
|US BORROWER            
|                       
|SMTC MEX HOLDINGS, INC.
|                        | 
|By:                     |  | /s/ John Caldwell
|Name:                   |  | John Caldwell    
|Title:                  |  | President & CEO  
|                       
|Address:               
|                       
|635 Hood Road          
|Markham, Ontario       
|Canada, L3R 4N6        
|                       
|Fax No: (905) 479-5326 



Each of the undersigned Obligors
hereby:



| | (a) | acknowledges, confirms and agrees that such Obligors Financing Agreements (as each of the same may have been amended, modified, supplemented, extended, renewed, restated or
replaced) remain in full force and effect as at the date hereof in respect of the Obligations under the Loan Agreement; and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | acknowledges and confirms that such Obligor has received a copy of the Loan Agreement and this Second Amending Agreement and understands the terms thereof.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------



Dated as of the 17th day of August, 2005.



|                 |  |                   |  |                                                  |  |        |  |                  
|---------------- |  | ----------------- |  | ------------------------------------------------ |  | ------ |  | -----------------
|SMTC CORPORATION |  |                   |  | SMTC MANUFACTURING CORPORATION OF NORTH CAROLINA
|                 |  |                   |  |                                                 
|By:              |  | /s/ John Caldwell |  |                                                  |  | By:    |  | /s/ John Caldwell
|Name:            |  | John Caldwell     |  |                                                  |  | Name:  |  | John Caldwell    
|Title:           |  | President & CEO   |  |                                                  |  | Title: |  | President & CEO  



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|                                        |  |                   |  |                    |  |        |  |                  
|--------------------------------------- |  | ----------------- |  | ------------------ |  | ------ |  | -----------------
|SMTC MANUFACTURING CORPORATION OF TEXAS |  |                   |  | HTM HOLDINGS, INC.
|                                        |  |                   |  |                   
|By:                                     |  | /s/ John Caldwell |  |                    |  | By:    |  | /s/ John Caldwell
|Name:                                   |  | John Caldwell     |  |                    |  | Name:  |  | John Caldwell    
|Title:                                  |  | President & CEO   |  |                    |  | Title: |  | President & CEO  



|                                          |  |                   |  |                                 |  |        |  |                  
|----------------------------------------- |  | ----------------- |  | ------------------------------- |  | ------ |  | -----------------
|RADIO COMPONENTES DE MEXICO, S.A. DE C.V. |  |                   |  | SMTC DE CHIHUAHUA, S.A. DE C.V.
|                                          |  |                   |  |                                
|By:                                       |  | /s/ John Caldwell |  |                                 |  | By:    |  | /s/ John Caldwell
|Name:                                     |  | John Caldwell     |  |                                 |  | Name:  |  | John Caldwell    
|Title:                                    |  | President & CEO   |  |                                 |  | Title: |  | President & CEO  



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