GUARANTY AND SURETYSHIP AGREEMENT
THIS GUARANTY AND SURETYSHIP AGREEMENT (this "Guaranty") is
made and entered into as of this 31st day of March, 1999, by DOVER
DOWNS, INC., a Delaware corporation, DOVER DOWNS INTERNATIONAL
SPEEDWAY, INC., a Delaware corporation, DOVER DOWNS PROPERTIES, INC.,
a Delaware corporation, GATEWAY INTERNATIONAL MOTORSPORTS
CORPORATION, an Illinois corporation, GATEWAY INTERNATIONAL SERVICES
CORPORATION, an Illinois corporation, GRAND PRIX ASSOCIATION OF LONG
BEACH, INC., a California corporation, MEMPHIS INTERNATIONAL
MOTORSPORTS CORPORATION, a Tennessee corporation, MOTORSPORTS
SERVICES CORPORATION OF MEMPHIS, a Tennessee corporation, and
NASHVILLE SPEEDWAY USA, INC., a Tennessee corporation (collectively,
the "Guarantor"), with an address at 0000 X. xxXxxx Xxxxxxx, Xxxxx,
XX 00000, in consideration of the extension of credit by the banks
and other financial institutions (collectively, the "Banks") from
time to time party to the Credit Agreement of even date herewith (the
"Credit Agreement") among the Banks, PNC BANK, DELAWARE , as Agent
(the "Agent"), with an address at 0 Xxx Xxxxx, Xxxxx, XX 00000, and
DOVER DOWNS ENTERTAINMENT, INC. (the "Borrower"), and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged.
Guaranty of Obligations. The Guarantor hereby guarantees, and
becomes surety for, the prompt payment and performance of all loans,
advances, debts, liabilities, obligations, covenants and duties owing
by the Borrower to the Agent and the Banks of any kind or nature,
present or future (including, without limitation, any interest
accruing thereon after maturity, or after the filing of a petition in
bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding relating to the Guarantor or the Borrower, whether or
not a claim for post-filing or post-petition interest is allowed in
such proceeding), whether or not evidenced by any note, guaranty or
other instrument, arising under the Credit Agreement or any Loan
Document (as defined in the Credit Agreement), whether direct or
indirect (including those acquired by assignment or participation),
absolute or contingent, joint or several, due or to become due, now
existing or hereafter arising, and any amendments, extensions,
renewals or increases and all costs and expenses of the Agent and the
Banks incurred in the modification, enforcement or collection of any
of the foregoing, including reasonable attorneys' fees and expenses
(collectively, the "Obligations"). If the Borrower defaults under
any such Obligations, the Guarantor will pay the amount due to the
Agent and the Banks.
Nature of Guaranty; Waivers. This is a guaranty of payment and not
of collection and the Agent and the Banks shall not be required, as a
condition of the Guarantor's liability, to make any demand upon or to
pursue any of its rights against the Borrower, or to pursue any
rights which may be available to them with respect to any other
person who may be liable for the payment of the Obligations.
This is an absolute, unconditional, irrevocable and continuing
guaranty and will remain in full force and effect until all of the
Obligations have been indefeasibly paid in full, and the Agent and
the Banks have terminated this Guaranty. This Guaranty will not be
affected by any surrender, exchange, acceptance, compromise or
release by the Agent or any Bank of any other party, or any other
guaranty or any security held by it for any of the Obligations, by
any failure of the Agent or any Bank to take any steps to perfect or
maintain its lien or security interest in or to preserve its rights
to any security or other collateral for any of the Obligations or any
guaranty, or by any irregularity, unenforceability or invalidity of
any of the Obligations or any part thereof or any security or other
guaranty thereof. The Guarantor's obligations hereunder shall not be
affected, modified or impaired by any counterclaim, set-off,
deduction or defense based upon any claim the Guarantor may have
against the Borrower, the Agent or any Bank, except payment or
performance of the Obligations.
Notice of acceptance of this Guaranty, notice of extensions of credit
to the Borrower from time to time, notice of default, diligence,
presentment, notice of dishonor, protest, demand for payment, and any
defense based upon the Agent's or any Bank's failure to comply with
the notice requirements of the applicable version of Uniform
Commercial Code 9-504 are hereby waived.
The Agent and the Banks at any time and from time to time, without
notice to or the consent of the Guarantor, and without impairing or
releasing, discharging or modifying the Guarantor's liabilities
hereunder, may (a) change the manner, place, time or terms of payment
or performance of or interest rates on, or other terms relating to,
any of the Obligations; (b) renew, substitute, modify, amend or
alter, or grant consents or waivers relating to any of the
Obligations, any other guaranties, or any security for any
Obligations or guaranties; (c) apply any and all payments by whomever
paid or however realized including any proceeds of any collateral, to
any Obligations of the Borrower in such order, manner and amount as
the Agent or any Bank may determine in its sole discretion; (d) deal
with any other person with respect to any Obligations in such manner
as the Agent or any Bank deems appropriate in its sole discretion;
(e) substitute, exchange or release any security or guaranty; or (f)
take such actions and exercise such remedies hereunder as provided
herein.
Repayments or Recovery from Agent or Banks. If any demand is made at
any time upon the Agent or any Bank for the repayment or recovery of
any amount received by it in payment or on account of any of the
Obligations and if the Agent or such Bank repays all or any part of
such amount by reason of any judgment, decree or order of any court
or administrative body or by reason of any settlement or compromise
of any such demand, the Guarantor will be and remain liable hereunder
for the amount so repaid or recovered to the same extent as if such
amount had never been received originally by the Agent or such Bank.
The provisions of this section will be and remain effective
notwithstanding any contrary action which may have been taken by the
Guarantor in reliance upon such payment, and any such contrary action
so taken will be without prejudice to the Agent's or any Bank's
rights hereunder and will be deemed to have been conditioned upon
such payment having become final and irrevocable.
Enforceability of Obligations. No modification, limitation or
discharge of the Obligations arising out of or by virtue of any
bankruptcy, reorganization or similar proceeding for relief of
debtors under federal or state law will affect, modify, limit or
discharge the Guarantor's liability in any manner whatsoever and this
Guaranty will remain and continue in full force and effect and will
be enforceable against the Guarantor to the same extent and with the
same force and effect as if any such proceeding had not been
instituted. The Guarantor waives all rights and benefits which might
accrue to it by reason of any such proceeding and will be liable to
the full extent hereunder, irrespective of any modification,
limitation or discharge of the liability of the Borrower that may
result from any such proceeding.
Events of Default. If any of the following occur (each an "Event of
Default"): (i) any Event of Default (as defined in the Credit
Agreement); (ii) the failure by the Guarantor to perform any of its
obligations hereunder; (iii) the falsity, inaccuracy or material
breach by the Guarantor of any written warranty, representation or
statement made or furnished to the Agent or any Bank by or on behalf
of the Guarantor; or (iv) the termination or attempted termination of
this Guaranty, then the Guarantor will, on the demand of the Agent or
any Bank, immediately deposit with the Agent in U.S. dollars all
amounts due or to become due under the Obligations and the Agent will
use such funds to repay the Obligations. Upon the occurrence of any
Event of Default, the Agent or any Bank in its discretion may
exercise with respect to any collateral any one or more of the rights
and remedies provided a secured party under the applicable version of
the Uniform Commercial Code.
Right of Setoff. In addition to all liens upon and rights of setoff
against the money, securities or other property of the Guarantor
given to the Agent and the Banks by law, each of PNC Bank, Delaware
and First Union National Bank shall have, with respect to the
Guarantor's obligations to the such Banks under this Guaranty and to
the extent permitted by law, a contractual possessory security
interest in and a contractual right of setoff against, and the
Guarantor hereby assigns, conveys, delivers, pledges and transfers to
the Agent for the ratable benefit of PNC Bank, Delaware and First
Union National Bank all of the Guarantor's right, title and interest
in and to, all deposits, moneys, securities and other property of the
Guarantor now or hereafter in the possession of or on deposit with,
or in transit to, PNC Bank, Delaware or First Union National Bank
whether held in a general or special account or deposit, whether held
jointly with someone else, or whether held for safekeeping or
otherwise, excluding, however, all XXX, Xxxxx, and trust accounts.
Every such security interest and right of setoff may be exercised
without demand upon or notice to the Guarantor. Every such right of
setoff shall be deemed to have occurred immediately upon the
occurrence of an Event of Default hereunder without any action of
either PNC Bank, Delaware or First Union National Bank, although PNC
Bank, Delaware and/or First Union National Bank may enter such setoff
on its respective books and records at a later time.
Costs. The Guarantor agrees to pay or reimburse each Bank and the
Agent from for all of their costs and expenses incurred in connection
with the enforcement or preservation of any rights under this
Guaranty, including, without limitation, reasonable fees and
disbursement of counsel to the Agent and to the several Banks.
Postponement of Subrogation. Until the Obligations are indefeasibly
paid in full, the Guarantor postpones and subordinates in favor of
the Agent for the ratable benefit of the Banks any and all rights
which the Guarantor may have to (a) assert any claim against the
Borrower based on subrogation rights with respect to payments made
hereunder, and (b) any realization on any property of the Borrower,
including participation in any marshalling of the Borrower's assets.
Notices. All notices, demands, requests, consents, approvals and
other communications required or permitted hereunder must be in
writing and will be effective upon receipt if delivered personally,
or if sent by facsimile transmission with confirmation of delivery,
or by nationally recognized overnight courier service, to the
addresses for the Agent and the Guarantor set forth above or to such
other address as one may give to the other in writing for such
purpose.
Preservation of Rights. No delay or omission on the Agent's or any
Bank's part to exercise any right or power arising hereunder will
impair any such right or power or be considered a waiver of any such
right or power, nor will the Agent's or any Bank's action or inaction
impair any such right or power. The Agent's and the Banks' rights
and remedies hereunder are cumulative and not exclusive of any other
rights or remedies which the Agent or any Bank may have under other
agreements, at law or in equity. The Agent or any Bank may proceed
in any order against the Borrower, the Guarantor or any other obligor
of, or collateral securing, the Obligations.
Illegality. In case any one or more of the provisions contained in
this Guaranty should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or
impaired thereby.
Changes in Writing. No modification, amendment or waiver of any
provision of this Guaranty nor consent to any departure by the
Guarantor therefrom will be effective unless made in a writing signed
by the Agent, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given. No
notice to or demand on the Guarantor in any case will entitle the
Guarantor to any other or further notice or demand in the same,
similar or other circumstance.
Entire Agreement. This Guaranty (including the documents and
instruments referred to herein) constitutes the entire agreement and
supersedes all other prior agreements and understandings, both
written and oral, among the Guarantor, the Agent and the Banks with
respect to the subject matter hereof.
Successors and Assigns. This Guaranty will be binding upon and inure
to the benefit of the Guarantor, the Agent and the Banks and, other
than with respect to Section 6, their respective heirs, executors,
administrators, successors and assigns; provided, however, that the
Guarantor may not assign this Guaranty in whole or in part without
the Agent's prior written consent and the Agent and any Bank at any
time may assign this Guaranty in whole or in part.
Interpretation. In this Guaranty, unless the Agent and the Guarantor
otherwise agree in writing, the singular includes the plural and the
plural the singular; references to statutes are to be construed as
including all statutory provisions consolidating, amending or
replacing the statute referred to; the word "or" shall be deemed to
include "and/or", the words "including", "includes" and "include"
shall be deemed to be followed by the words "without limitation"; and
references to sections or exhibits are to those of this Guaranty
unless otherwise indicated. Section headings in this Guaranty are
included for convenience of reference only and shall not constitute a
part of this Guaranty for any other purpose. If this Guaranty is
executed by more than one party as Guarantor, the obligations of such
persons or entities will be joint and several.
Indemnity. The Guarantor agrees to indemnify each of the Agent, each
Bank and its respective directors, officers and employees and each
legal entity, if any, who controls the Agent or any Bank
(collectively, the "Indemnified Parties") and to hold each
Indemnified Party harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever
with respect to the execution, delivery, enforcement and performance
of this Guaranty (all of the foregoing, collectively, the
"Indemnified Liabilities"); provided, however, that the Guarantor
shall have no obligation hereunder to any Indemnified Party with
respect to Indemnified Liabilities arising from the gross negligence
or willful misconduct of any Indemnified Party. The indemnity
agreement contained in this Section shall survive the termination of
this Guaranty.
Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF DELAWARE.
(b) The Guarantor hereby irrevocably and unconditionally:
(i) submits for itself and its property in any
legal action or proceeding relating to this Agreement or for
recognition and enforcement of any judgement in respect thereof, to
the non-exclusive general jurisdiction of the Courts of the State of
Delaware, the courts of the United States of America for the District
of Delaware, and appellate courts from any thereof;
(ii) consents that any such action or proceeding
may be brought in such courts and waives any objection that it may
now or hereafter have to the venue of any such action or proceeding
in any such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(iii) agrees that service of process in any
such action or proceeding may be effected by mailing a copy thereof
by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to the Guarantor at the address set forth
above or at such other address of which the Agent shall have been
notified pursuant to Section 10 hereof;
(iv) agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by
law or shall limit the right to xxx in any other jurisdiction; and
(v) waives, to the maximum extent not prohibited
by law, any right it may have to claim or recover in any legal action
or proceeding referred to in this subsection any special, exemplary
or punitive or consequential damages.
Equal Credit Opportunity Act. If the Guarantor is not an "applicant
for credit" under Section 202.2 (e) of the Equal Credit Opportunity
Act of 1974 ("ECOA"), the Guarantor acknowledges that (i) this
Guaranty has been executed to provide credit support for the
Obligations, and (ii) the Guarantor was not required to execute this
Guaranty in violation of Section 202.7(d) of the ECOA.
WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.
The Guarantor acknowledges that it has read and understood all the
provisions of this Guaranty, including the waiver of jury trial, and
has been advised by counsel as necessary or appropriate.
WITNESS the due execution hereof as a document under seal, as of the
date first written above, with the intent to be legally bound
hereby.
DOVER DOWNS, INC.
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
DOVER DOWNS INTERNATIONAL
SPEEDWAY, INC.
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
DOVER DOWNS PROPERTIES, INC.
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
GATEWAY INTERNATIONAL
MOTORSPORTS CORPORATION
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
GATEWAY INTERNATIONAL
SERVICES CORPORATION
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
GRAND PRIX ASSOCIATION OF
LONG BEACH, INC.
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
MEMPHIS INTERNATIONAL
MOTORSPORTS CORPORATION
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
MOTORSPORTS SERVICES CORPORATION
OF MEMPHIS
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
NASHVILLE SPEEDWAY USA, INC.
Attest:_______________________ By:___________________________
Print Name:___________________ Print Name:___________________
Title:________________________ Title:________________________
