GUARANTEE BY SMTC MANUFACTURING CORP. OF CALIFORNIA DATED JUNE 1, 2004



 Exhibit 10.48 
  
 GUARANTEE 
  
 June 1, 2004 
  
 Congress Financial Corporation (Central) 
 150 South Wacker Drive, Suite 2200 
 Chicago, Illinois 60606 
  

	Re:	SMTC Manufacturing Corporation of California, SMTC Manufacturing Corporation of Wisconsin, SMTC Manufacturing Corporation of Massachusetts and SMTC Mex Holdings, Inc.
(individually, a “Borrower” and collectively, the “Borrowers”) 

  
 Gentlemen: 
  
 Congress Financial
Corporation (Central) individually and as collateral agent (the “Lender”) has entered into certain financing arrangements with Borrowers and affiliates of Borrowers pursuant to which Lender may make loans and advances and provide
other financial accommodations to Borrowers and their affiliates as set forth in the loan agreement dated on or about the date hereof, by and among Lender, Borrowers and certain other loan parties (as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced, the “Loan Agreement”) and the other agreements, documents and instruments referred to therein or at any time executed and/or delivered in connection therewith or
related thereto, including this Guarantee (all of the foregoing, including the Loan Agreement, as the same now exist or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, being collectively referred to herein
as the “Financing Agreements”). 
  
 Due to the
close business and financial relationships between Borrowers, in consideration of the benefits which will accrue to SMTC MANUFACTURING CORPORATION OF CALIFORNIA (the “Guarantor”) and as an inducement for and in consideration of
Lender making loans and advances and providing other financial accommodations to Borrowers and their affiliates pursuant to the Loan Agreement and other Financing Agreements, Guarantor hereby agrees in favour of Lender as follows: 
  

	1.	Guarantee 

  

	 	(a)	Guarantor absolutely and unconditionally guarantees and agrees to be liable for the full and indefeasible payment and performance when due of the following (all of which are
collectively referred to herein as the “Guaranteed Obligations”): 

  

	 	(i)	 all obligations, liabilities and indebtedness of any kind, nature and description of each Borrower to Lender and/or its affiliates, including principal, interest,
charges, fees, costs and expenses, however evidenced, whether as principal, surety, endorser, guarantor or otherwise, whether 



  










	 	 
arising under the Loan Agreement and other Financing Agreements or otherwise, whether now existing or hereafter arising, whether arising before, during or
after the initial or any renewal term of the Loan Agreement or after the commencement of any case with respect to a Borrower and/or its affiliates under the United States Bankruptcy Code or any similar statute in any jurisdiction (the
“Insolvency Legislation”) (including, without limitation, the payment of interest and other amounts, which would accrue and become due but for the commencement of such case, whether or not such amounts are allowed or allowable in
whole or in part in any such case and including loans, interest, fees, charges and expenses related thereto and all other obligations of a Borrower and its affiliates or their respective successors to Lender arising after the commencement of such
case), whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, secured or unsecured, and however acquired by Lender; and 


  

	 	(ii)	all expenses (including, without limitation, attorneys’ fees and legal expenses) incurred by Lender in connection with the preparation, execution, delivery, recording,
administration, collection, liquidation, enforcement and defence of each Borrower’s and its affiliates’ obligations, liabilities and indebtedness as aforesaid to Lender, the rights of Lender in any collateral or under this Guarantee and
all other Financing Agreements or in any way involving claims by or against Lender directly or indirectly arising out of or related to the relationships between Borrowers and their affiliates, Guarantor or any other Obligor (as hereinafter defined)
and Lender, whether such expenses are incurred before, during or after the initial or any renewal term of the Loan Agreement or other Financing Agreements or after the commencement of any case with respect to Borrowers and/or their affiliates or
Guarantor under the Insolvency Legislation. 

  

	 	(b)	This Guarantee is a guaranty of payment and not of collection. Guarantor agrees that Lender need not attempt to collect any Guaranteed Obligations from Borrowers and/or their
affiliates or any other Obligor or to realize upon any collateral, but may require Guarantor to make immediate payment of all of the Guaranteed Obligations to Lender when due, whether by maturity, acceleration or otherwise, or at any time
thereafter. Lender may apply any amounts received in respect of the Guaranteed Obligations to any of the Guaranteed Obligations, in whole or in part (including attorneys’ fees and legal expenses incurred by Lender with respect thereto or
otherwise chargeable to Borrowers and their affiliates or Guarantor) and in such order as Lender may elect. 

  

	 	(c)	 Payment by Guarantor shall be made to Lender at the office of Lender from time to time, on demand, as Guaranteed Obligations become due. Guarantor shall make all
payments to Lender on the Guaranteed Obligations free and clear of, and without deduction or withholding for or on account of, any set-off, counterclaim, 



  

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defence, duties, taxes, levies, imposts, fees, deductions, withholding, restrictions or conditions of any kind. One or more successive or concurrent actions
may be brought hereon against Guarantor either in the same action in which a Borrower or its affiliates or any other Obligor is sued or in separate actions. In the event any claim or action, or action on any judgment, based on this Guarantee is
brought against Guarantor, Guarantor agrees not to deduct, set-off, or seek any counterclaim for or recoup any amounts which are or may be owed by Lender to Guarantor. 


  

	2.	Waivers and Consents 

  

	 	(a)	Notice of acceptance of this Guarantee, the making of loans and advances and providing other financial accommodations to Borrowers and their affiliates and presentment, demand,
protest, notice of protest, notice of non-payment or default and all other notices to which Borrowers and/or their affiliates or Guarantor is entitled are hereby waived by Guarantor. Guarantor also waives notice of and hereby consents to:


  

	 	(i)	any amendment, modification, supplement, extension, renewal, or restatement of the Loan Agreement and other Financing Agreements, including, without limitation, extensions of time
of payment of or increase or decrease in the amount of any of the Guaranteed Obligations, the interest rate, fees, other charges, or any collateral, and the guarantee made herein shall apply to the Loan Agreement and other Financing Agreements and
the Guaranteed Obligations as so amended, modified, supplemented, renewed, restated or extended, increased or decreased; 

  

	 	(ii)	the taking, exchange, surrender and releasing of collateral or guarantees now or at any time held by or available to Lender for the obligations of Borrowers and/or their affiliates
or any other party at any time liable on or in respect of the Guaranteed Obligations or who is the owner of any property which is security for the Guaranteed Obligations (individually, an “Obligor” and collectively, the
“Obligors”); 

  

	 	(iii)	the exercise of, or refraining from the exercise of any rights against a Borrower and/or its affiliates, Guarantor or any other Obligor or any collateral; 


 

	 	(iv)	the settlement, compromise or release of, or the waiver of any default with respect to, any of the Guaranteed Obligations; and 

  

	 	(v)	any financing by Lender of Borrowers under Section 364 of the United States Bankruptcy Code or consent to the use of cash collateral by Lender under Section 363 of the United States
Bankruptcy Code. 

  
 Guarantor agrees that the
amount of the Guaranteed Obligations shall not be diminished and the liability of Guarantor hereunder shall not be otherwise impaired or affected by any of the foregoing. 
  

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	 	(b)	No invalidity, irregularity or unenforceability of all or any part of the Guaranteed Obligations shall affect, impair or be a defence to this Guarantee, nor shall any other
circumstance which might otherwise constitute a defence available to or legal or equitable discharge of a Borrower or its affiliates in respect of any of the Guaranteed Obligations, or Guarantor in respect of this Guarantee, affect, impair or be a
defence to this Guarantee. Without limitation of the foregoing, the liability of Guarantor hereunder shall not be discharged or impaired in any respect by reason of any failure by Lender to perfect or continue perfection of any lien or security
interest in any collateral or any delay by Lender in perfecting any such lien or security interest. As to interest, fees and expenses, whether arising before or after the commencement of any case with respect to a Borrower or its affiliates under
any Insolvency Legislation, Guarantor shall be liable therefor, even if a Borrower’s or its affiliates’ liability for such amounts does not, or ceases to, exist by operation of law. Guarantor acknowledges that Lender has not made any
representations to Guarantor with respect to Borrowers and/or their affiliates, any other Obligor or otherwise in connection with the execution and delivery by Guarantor of this Guarantee and Guarantor is not in any respect relying upon Lender or
any statements by Lender in connection with this Guarantee. 

  

	 	(c)	Guarantor hereby irrevocably and unconditionally waives and relinquishes all statutory, contractual, common law, equitable and all other claims against Borrowers and their
affiliates, any collateral for the Guaranteed Obligations or other assets of Borrowers and their affiliates or any other Obligor, for subrogation, reimbursement, exoneration, contribution, indemnification, set-off or other recourse in respect to
sums paid or payable to Lender by Guarantor hereunder and Guarantor hereby further irrevocably and unconditionally waives and relinquishes any and all other benefits which Guarantor might otherwise directly or indirectly receive or be entitled to
receive by reason of any amounts paid by or collected or due from Guarantor, Borrowers and/or their or any other Obligor upon the Guaranteed Obligations or realized from their property. 

  

	 	(d)	Notwithstanding anything to the contrary contained herein, the amount of the obligations payable by Guarantor under this Guarantee shall be the aggregate amount of the Guaranteed
Obligations unless a court of competent jurisdiction adjudicates Guarantor’s obligations to be invalid, avoidable or unenforceable for any reason (including, without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers), in which case the amount of the Guaranteed Obligations payable by Guarantor hereunder shall be limited to the maximum amount that could be guaranteed by Guarantor without rendering Guarantor’s obligations
under this Guarantee invalid, avoidable or unenforceable under such applicable law. 

  

	3.	Subordination. Payment of all amounts now or hereafter owed to Guarantor by a Borrower or its affiliates or any other Obligor is hereby subordinated in right of payment to
the indefeasible payment in full to Lender of the Guaranteed Obligations and all such amounts and any security and guarantees therefor are hereby assigned to Lender as security for the Guaranteed Obligations. 

  

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	4.	Acceleration. Notwithstanding anything to the contrary contained herein or any of the terms of any of the other Financing Agreements, the liability of Guarantor for the
entire Guaranteed Obligations shall mature and become immediately due and payable, even if the liability of a Borrower or any other Obligor therefor does not, upon the occurrence of any act, condition or event which constitutes an Event of Default
(as such term is defined in the Loan Agreement). 

  

	5.	Account Stated. The books and records of Lender showing the account between Lender and Borrowers shall be admissible in evidence in any action or proceeding against or
involving Guarantor as prima facie proof of the items therein set forth, and the monthly statements of Lender rendered to a Borrower, to the extent to which no written objection is made within thirty (30) days from the date of sending thereof
to such Borrower, shall be deemed conclusively correct and constitute an account stated between Lender and such Borrower and be binding on Guarantor. 

  

	6.	Termination. This Guarantee is continuing, unlimited, absolute and unconditional. All Guaranteed Obligations shall be conclusively presumed to have been created in reliance
on this Guarantee. Guarantor shall continue to be liable hereunder until one of Lender’s officers actually receives a written termination notice from Guarantor sent to Lender at its address set forth above by certified mail (return receipt
requested) and thereafter as set forth below. Revocation or termination hereof by Guarantor shall not affect, in any manner, the rights of Lender or any obligations or duties of Guarantor under this Guarantee with respect to:


  

	 	(a)	Guaranteed Obligations which have been created, contracted, assumed or incurred prior to the receipt by Lender of such written notice of revocation or termination as provided
herein, including, without limitation: 

  

	 	(i)	all amendments, extensions, renewals and modifications of such Guaranteed Obligations (whether or not evidenced by new or additional agreements, documents or instruments executed on
or after such notice of revocation or termination); 

  

	 	(ii)	all interest, fees and similar charges accruing or due on and after revocation or termination; and 

  

	 	(iii)	all attorneys’ fees and legal expenses, costs and other expenses paid or incurred on or after such notice of revocation or termination in attempting to collect or enforce any
of the Guaranteed Obligations against a Borrower or its affiliates, Guarantor or any other Obligor (whether or not suit be brought); or 

  

	 	(b)	 Guaranteed Obligations which have been created, contracted, assumed or incurred after the receipt by Lender of such written notice of revocation or termination as
provided herein pursuant to any contract entered into by Lender prior to receipt of such notice. The sole effect of such revocation or termination by Guarantor shall be to exclude from this Guarantee the liability of Guarantor for those Guaranteed




  

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Obligations arising after the date of receipt by Lender of such written notice which are unrelated to Guaranteed Obligations arising or transactions entered
into prior to such date. Without limiting the foregoing, this Guarantee may not be terminated and shall continue so long as the Loan Agreement shall be in effect (whether during its original term or any renewal, substitution or extension thereof).



  

	7.	Reinstatement. If after receipt of any payment of, or proceeds of collateral applied to the payment of, any of the Guaranteed Obligations, Lender is required to surrender or
return such payment or proceeds to any Person for any reason, then the Guaranteed Obligations intended to be satisfied by such payment or proceeds shall be reinstated and continue and this Guarantee shall continue in full force and effect as if such
payment or proceeds had not been received by Lender. Guarantor shall be liable to pay to Lender, and does indemnify and hold Lender harmless for the amount of any payments or proceeds surrendered or returned. This Section 7 shall remain effective
notwithstanding any contrary action which may be taken by Lender in reliance upon such payment or proceeds. This Section 7 shall survive the termination or revocation of this Guarantee. 

  

	8.	Amendments and Waivers. Neither this Guarantee nor any provision hereof shall be amended, modified, waived or discharged orally or by course of conduct, but only by a written
agreement signed by an authorized officer of Lender. Lender shall not by any act, delay, omission or otherwise be deemed to have expressly or impliedly waived any of its rights, powers and/or remedies unless such waiver shall be in writing and
signed by an authorized officer of Lender. Any such waiver shall be enforceable only to the extent specifically set forth therein. A waiver by Lender of any right, power and/or remedy on any one occasion shall not be construed as a bar to or waiver
of any such right, power and/or remedy which Lender would otherwise have on any future occasion, whether similar in kind or otherwise. 

  

	9.	Corporate Existence, Power and Authority. Guarantor is a corporation duly organized and in good standing under the laws of its state or other jurisdiction of incorporation
and is duly qualified as a foreign corporation and in good standing in all states or other jurisdictions where the nature and extent of the business transacted by it or the ownership of assets makes such qualification necessary, except for those
jurisdictions in which the failure to so qualify would not have a material adverse effect on its financial condition, results of operation or businesses or the rights of Lender hereunder or under the Loan Agreement and other Financing Agreements.
The execution, delivery and performance of this Guarantee is within the corporate powers of Guarantor, have been duly authorized and are not in contravention of law or the terms of the certificates of incorporation, by-laws, or other organizational
documentation of Guarantor, or any indenture, agreement or undertaking to which Guarantor is a party or by which Guarantor or its property are bound. This Guarantee constitutes the legal, valid and binding obligation of Guarantor enforceable in
accordance with its terms. Guarantor shall be bound hereby whether or not any other person signs this Guarantee at any time. 

  

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	10.	Governing Law; Choice of Forum; Service of Process; Jury Trial Waiver 

  

	 	(a)	The validity, interpretation and enforcement of this Guarantee and any dispute arising out of the relationship between Guarantor and Lender, whether in contract, tort, equity or
otherwise, shall be governed by the internal laws of the State of Illinois but excluding any principles of conflicts of law or other rule of law that would result in the application of the law of any jurisdiction other than the laws of the State of
Illinois. 

  

	 	(b)	Guarantor hereby irrevocably consents and submits to the non-exclusive jurisdiction of the Circuit Court of Cook County, Illinois and the United States District Court for the
Northern District of Illinois, whichever Lender elects, and waives any objection based on venue or forum non conveniens with respect to any action instituted therein arising under this Guarantee or any of the other Financing Agreements or in
any way connected with or related or incidental to the dealings of Guarantor and Lender in respect of this Guarantee or any of the other Financing Agreements or the transactions related hereto or thereto, in each case whether now existing or
hereafter arising and whether in contract, tort, equity or otherwise, and agrees that any dispute arising out of the relationship between Guarantor, Borrowers or their affiliates or any Obligor and Lender or the conduct of any such persons in
connection with this Guarantee, the other Financing Agreements or otherwise shall be heard only in the courts described above (except that Lender shall have the right to bring any action or proceeding against Guarantor or its property in the courts
of any other jurisdiction which Lender deems necessary or appropriate in order to realize on any collateral at any time granted by a Borrower or its affiliates or Guarantor to Lender or to otherwise enforce its rights against Guarantor or its
property). 

  

	 	(c)	Guarantor hereby waives personal service of any and all process upon it and consents that all such service of process may be made by certified mail (return receipt requested)
directed to its address set forth on the signature pages hereof and service so made shall be deemed to be completed five (5) days after the same shall have been so deposited in the US mails, or, at Lender’s option, by service upon Guarantor in
any other manner provided under the rules of any such courts. Within thirty (30) days after such service, Guarantor shall appear in answer to such process, failing which Guarantor shall be deemed in default and judgment may be entered by Lender
against Guarantor for the amount of the claim and other relief requested. 

  

	 	(d)	 GUARANTOR HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS GUARANTEE OR ANY OF THE OTHER FINANCING
AGREEMENTS OR (ii) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF GUARANTOR AND LENDER IN RESPECT OF THIS GUARANTEE OR ANY OF THE OTHER FINANCING AGREEMENTS OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER 



  

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ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. GUARANTOR HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT GUARANTOR OR LENDER MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF GUARANTOR AND LENDER TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY. 


  

	 	(e)	Lender shall not have any liability to Guarantor (whether in tort, contract, equity or otherwise) for losses suffered by Guarantor in connection with, arising out of, or in any way
related to the transactions or relationships contemplated by this Guarantee, or any act, omission or event occurring in connection herewith, unless it is determined by a final and non-appealable judgment or court order binding on Lender that the
losses were the result of acts or omissions constituting gross negligence or wilful misconduct. In any such litigation, Lender shall be entitled to the benefit of the rebuttable presumption that it acted in good faith and with the exercise of
ordinary care in the performance by it of the terms of the Financing Agreements. 

  

	11.	Judgment Currency. To the extent permitted by applicable law, the obligations of Guarantor in respect of any amount due under this Agreement and other Financing Agreements to
which Guarantor is a party shall, notwithstanding any payment in any other currency (the “Other Currency”) (whether pursuant to judgment or otherwise), be discharged only to the extent of the amount in the currency in which it is
due (the “Agreed Currency”) that Lender may, in accordance with normal banking procedures, purchase with the sum paid in the Other Currency (after any premium and costs of exchange) on the business day immediately after the day on
which Lender receives the payment. If the amount in the Agreed Currency that may be so purchased for any reason falls short of the amount originally due, Guarantor shall pay all additional amounts, in the Agreed Currency, as may be necessary to
compensate for the shortfall. Any obligation of Guarantor not discharged by that payment shall, to the extent permitted by applicable law, be due as a separate and independent obligation and, until discharged as provided in this Section, continue in
full force and effect. 

  

	12.	Notices. All notices, requests and demands hereunder shall be in writing and: 

  

	 	(a)	made to Lender at its address set forth above and to Guarantor at its chief executive office set forth below, or to such other address as either party may designate by written
notice to the other in accordance with this provision; and 

  

	 	(b)	deemed to have been given or made: if delivered in person, immediately upon delivery; if by telex, telegram or facsimile transmission, immediately upon sending and upon confirmation
of receipt; if by nationally recognized overnight courier service with instructions to deliver the next business day, one (1) business day after sending; and if by certified mail (return receipt requested) five (5) days after mailing.


  

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	13.	Partial Invalidity. If any provision of this Guarantee is held to be invalid or unenforceable, such invalidity or unenforceability shall not invalidate this Guarantee as a
whole, but this Guarantee shall be construed as though it did not contain the particular provision held to be invalid or unenforceable and the rights and obligations of the parties shall be construed and enforced only to such extent as shall be
permitted by applicable law. 

  

	14.	Entire Agreement. This Guarantee represents the entire agreement and understanding of the parties concerning the subject matter hereof, and supersedes all other prior
agreements, understandings, negotiations and discussions, representations, warranties, commitments, proposals, offers and contracts concerning the subject matter hereof, whether oral or written. 

  

	15.	Successors and Assigns. This Guarantee shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Lender and its successors, endorsees,
transferees and assigns. The liquidation, dissolution or termination of Guarantor shall not terminate this Guarantee as to such entity or as to any other guarantor. 

  

	16.	Construction. All references to the term “Guarantor” wherever used herein shall mean Guarantor and its successors and assigns (including, without limitation,
any receiver, trustee or custodian for Guarantor or of its assets or Guarantor in its capacity as debtor or debtor-in-possession under the Insolvency Legislation). All references to the term “Lender” wherever used herein shall mean
Lender and its successors and assigns and all references to the term “Borrowers” or “affiliates” wherever used herein shall mean each Borrower and affiliate and their respective successors and assigns (including,
without limitation, any receiver, trustee or custodian for Borrowers or affiliates or any of their assets or Borrowers or affiliates in their capacities as debtor or debtor-in-possession under the Insolvency Legislation). All references to the term
“Person” or “person” wherever used herein shall mean any individual, sole proprietorship, partnership, limited partnership, corporation, limited liability company, business trust, unincorporated association, joint
stock corporation, trust, joint venture or other entity or any government or any agency or instrumentality or political subdivision thereof. All references to the plural shall also mean the singular and to the singular shall also mean the plural.


  

	17.	Acknowledgement. Guarantor acknowledges receipt of a copy of this Guarantee. 

  

	18.	Facsimile. This Guarantee may be executed and delivered by facsimile transmission and Lender may rely on all such facsimile signatures as though such facsimile signatures
were original signatures. 

  

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 IN WITNESS WHEREOF, Guarantor has executed and delivered this Guarantee as of the day and year first above
written. 
  

									
	 ATTEST:
	 	 	 	 SMTC MANUFACTURING
 CORPORATION OF
CALIFORNIA

				
	 	 	 	 	 By:
	 	 /s/ John Caldwell

					
	 	 	 	 	 	 	 Title:
	 	 President

			
	 ATTEST:
	 	 	 	 
				
	 	 	 	 	By:	 	 
					
	 	 	 	 	 	 	 Title:
	 	 
			
	 [CORPORATE SEAL]
	 	 	 	 
			
	 	 	 	 	 Chief Executive Office:

			
	 	 	 	 	 2302 Trade Zone Boulevard
 San Jose, California
 95131
 Fax: (408) 934-7101


  

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