LOAN AGREEMENT
Exhibit
10.4
$100,000,000
This LOAN
AGREEMENT (this “Agreement”)
is made as of August 5, 2009 (the “Effective
Date”), between ENTERPRISE PRODUCTS OPERATING LLC, a Texas limited
liability company, with principal offices at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000 (“Lender”),
and TEPPCO PARTNERS, L.P., a Delaware limited partnership with principal offices
at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000 (“Borrower”). Each
capitalized term used but not otherwise defined in this Agreement shall have the
meaning given to such term in Exhibit A
hereto.
For good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Lender and Borrower agree as follows:
1. Commitment. Subject to the
terms and conditions set forth herein, Lender agrees to make available to
Borrower funds in an aggregate maximum outstanding principal amount of
$100,000,000.00 (the “Commitment
Amount”).
2. Loan. Subject to the
provisions of this Agreement, upon the receipt of a Request for Borrowing (as
defined in Section
6), Lender agrees to make a revolving loan (the “Loan”) to
Borrower in an aggregate maximum outstanding principal amount not to exceed the
Commitment Amount. Each amount drawn under the Loan (“Borrowings”),
and each repayment of Borrowings, will be in a minimum principal amount of
$25,000,000.00 and in whole increments of $25,000,000.00 in excess
thereof.
3. Repayment of the Loan.
Borrower promises to pay the outstanding principal balance of the Loan, together
with interest accrued and outstanding thereon and any other sums due hereunder,
on the earliest to occur of (a) the consummation of the merger of Borrower with
a subsidiary of Enterprise Products Partners L.P., a Delaware limited
partnership (“EPD”),
pursuant to the Merger Agreement, (b) the termination of the Merger Agreement in
accordance with the provisions thereof, (c) December 31, 2009 (the “Maturity
Date”), (d) the date upon which the maturity of the Loan may have been
accelerated pursuant to Section 13, or
(e) the date upon which the commitment of Lender hereunder may have been
terminated pursuant to Section
14.
4. Guaranty. As a condition
precedent to any drawing under the Loan, Borrower shall cause each Significant
Subsidiary (as defined in the Credit Agreement), other than any Excluded
Subsidiary (as defined in the Credit Agreement) of Borrower, whether now
existing or in the future formed or acquired as permitted by the Credit
Agreement (each, a “Guarantor”),
to unconditionally and irrevocably guarantee to Lender:
(a) the
due and punctual payment in full (and not merely the collection) of the
principal of any and all Borrowings, and any and all interest thereon, in each
case, when due and payable, all according to the provisions of this Agreement;
and
(b) the
due and punctual payment in full (and not merely the collection) of all other
sums and charges which may at any time be due and payable in accordance with
the
provisions of this
Agreement, in each case, by execution of a Guaranty, in substantially the form
attached hereto as Exhibit
B (“Guaranty”). Any Guaranty delivered by
a Guarantor after the Effective Date pursuant to this Section
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shall be accompanied
by such certificates, documents and other information regarding such Guarantor
as Lender may request.
5. Early Repayment of the Loan.
Borrower will have the option to repay the Loan upon three
(3) Business Days prior written notice, in whole or in part (subject to the
minimum and incremental principal amounts for repayments, as described in Section 2), on any
Business Day. Any repayment of principal must be accompanied by a concurrent
payment of any and all accrued and unpaid interest on such principal amount to
the date of repayment.
6. Request for Borrowing. On any
Business Day including or after the Effective Date, but prior to the Maturity
Date, Borrower may request a Borrowing by delivering a written notice to Lender
(each, a “Request for
Borrowing”), which such notice (a) shall be irrevocable and binding on
Borrower, (b) shall state (i) the amount of such requested Borrowing and (ii)
the date on which the funds underlying such Borrowing are to be delivered to
Borrower, (c) must be received by Lender no later than 9:00 a.m., Houston,
Texas time, on the third Business Day immediately preceding the date on which
the funds underlying such Borrowing are to be delivered to Borrower, and
(d) shall otherwise be in a form acceptable to Lender.
7. Fees. Borrower
agrees to pay Lender all fees as calculated below:
(a) Closing Fee. Upon execution
of this Agreement on the Effective Date, Borrower agrees to pay Lender a fee in
immediately available funds in an amount equal to (i) the Commitment Amount,
multiplied by (ii) 0.25%.
(b) Fee on Undrawn Portion of Commitment
Amount. Borrower agrees to pay Lender a fee equal to (i) the amount of
any undrawn portion of the Commitment Amount (i.e., the Commitment Amount minus
the aggregate principal amount of any and all outstanding Borrowings),
multiplied by (ii) 0.50% per annum (on the basis of a 365 day year), for each
day commencing on the Effective Date and ending upon the earlier of, and
including, the Maturity Date or the date that Lender’s commitment under this
Agreement is terminated in accordance with Section 13 or Section 14. Fees
payable in accordance with this Section 7 will be due
on each Payment Date.
(c) All
fees payable herein shall be paid on the dates due, and shall not be refundable
under any circumstances.
8. Interest. Borrower shall pay
interest on the unpaid principal amount of the Loan outstanding from the
Effective Date until the principal amount shall be paid in full, at a rate per
annum at all times during each Interest Period equal to the Interest Rate for
such Interest Period, payable in arrears on each Payment Date; provided that, in the event
of any repayment or prepayment of the Loan, accrued interest on the principal
amount
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repaid
or prepaid shall be payable on the date of such repayment or prepayment.
Interest payable hereunder shall be calculated on the basis of a year of
360 days.
9. Interest Period. For the
purposes of this Agreement, “Interest
Period” means (a) the period commencing on the Effective Date and ending
on, but not including, September 1, 2009 and (b) thereafter, each
subsequent period commencing on the last day of the next preceding Interest
Period and ending on, but not including, the first Business Day of the next
succeeding calendar month; provided, that, in the case
of any Interest Period that commences before the Maturity Date, and would
otherwise end on a date occurring after the Maturity Date, such Interest Period
shall end on the Maturity Date.
10. Interest Rate. For the period
commencing on the Effective Date and ending on (but not including)
September 1, 2009, interest on outstanding Borrowings shall be assessed at
a floating rate of interest equivalent to the one-month LIBOR Rate plus 2.00%
(the “Interest
Rate”). The LIBOR Rate shall be set for each Interest Period as provided
in the definition of the term “LIBOR Rate” set forth in Exhibit A
hereto.
Notwithstanding
the foregoing provisions of this Section 10 or
any other provision of this Agreement, interest on the Loan and other amounts
due hereunder at any time shall be limited to the highest lawful rate that may
be charged under the laws of the State of New York at such time.
11. Borrower’s Representations and
Warranties. Borrower represents and warrants to Lender that:
(a) each
of Borrower and the Guarantors (i) has been duly formed and is validly
existing in good standing under the laws of its jurisdiction of organization and
(ii) is qualified to do business as a foreign entity in good standing in
each jurisdiction of the United States in which the ownership of its properties
or the conduct of its business requires such qualification and where the failure
to so qualify would be reasonably expected to have a material adverse effect on
Borrower and its subsidiaries, taken as a whole; and
(b) this
Agreement has been duly authorized, executed and delivered by Borrower and
constitutes the valid and binding agreement of Borrower, enforceable in
accordance with its terms, except as enforceability may be limited by
BankruptcyLaws and general principles of equity.
12. Conditions of Lending. The
obligation of Lender to fund any Borrowing hereunder is subject to the
conditions precedent that, on and as of the date of funding of such
Borrowing:
(a) each
of the representations and warranties set forth in Section 11 is
true and accurate;
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(b) no
event has occurred and is continuing (or would result from the proposed
Borrowing) that constitutes a Potential Default or Event of Default under this
Agreement or under the Credit Agreement;
(c)
Borrower has caused each Guarantor to issue a Guaranty in accordance with Section 4;
and
(d) no
additional amounts are available to Borrower pursuant to the Credit Agreement
either as Borrowings (as defined in the Credit Agreement) or under any Letters
of Credit (as defined in the Credit Agreement).
13. Events of Default. If one or
more of the following events of default (each an “Event of
Default”) shall occur and be continuing:
(a)
Borrower shall default in any payment of principal of the Loan when and as the
payment shall become due and payable, or Borrower shall default in any payment
of interest as required herein, or in the payment of any fees or other amounts
as required herein, when the same shall become due and payable, and such default
shall continue for a period of three (3) Business Days;
(b)
Borrower shall (i) apply for or consent to the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of itself
or of its property, (ii) admit in writing of its inability to pay its debts
as such debts become due, (iii) make a general assignment for the benefit
of its creditors, (iv) commence a voluntary case under any Bankruptcy Law,
(v) file a petition seeking to take advantage of any other law providing
for similar relief of debtors, or (vi) consent or acquiesce in writing to
any petition duly filed against it in any involuntary case under any Bankruptcy
Law;
(c) a
proceeding or case shall be commenced, without the application or consent of
Borrower in any court of competent jurisdiction seeking (i) its
liquidation, reorganization, dissolution or winding up, or the composition or
readjustment of its debts, (ii) the appointment of a trustee, receiver,
custodian, liquidator or the like of it or of its assets, or (iii) similar
relief in respect of it, under any law providing for the relief of debtors, and
such proceeding or case shall continue undismissed, or unstayed and in effect,
for a period of sixty (60) days (or such longer period, so long as Borrower
shall be taking such action in good faith as shall be reasonably necessary to
obtain the timely dismissal or stay of such proceeding or case); or an order for
relief shall be entered in an involuntary case under any applicable Bankruptcy
Law, against Borrower;
(d) a
Change of Control shall occur; or
(e) any
Event of Default (as defined in the Credit Agreement) shall occur; then (and
in each and every such case) Lender, by notice in writing to Borrower, may
terminate the commitment of Lender hereunder and/or declare the unpaid balance
of the Loan and any other amounts payable hereunder to be forthwith due and
payable, and thereupon such balance shall become so due and payable without
presentation, protest or further demand or notice of any kind, all of which are
hereby expressly waived; provided that in
the case of Section 13(b)
and Section 13(c)
above, the commitments of Lender hereunder shall
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automatically
terminate and the Loan and any other amounts payable hereunder shall forthwith
be due and payable.
14. Termination of Lender’s Commitment
at Election of Borrower. Borrower may, at any time upon three
Business Days’ prior written notice to Lender, terminate Lender’s commitment to
make the Loan under this Agreement; provided, that upon any such
termination, any unpaid balance of the Loan and any other amounts payable
hereunder shall become immediately due and payable without presentation, protest
or further demand or notice of any kind, all of which are hereby expressly
waived.
15. Waivers; Amendments. No
failure or delay by Lender to exercise any right or power shall operate as a
waiver thereof, nor shall any partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such right or power,
preclude any other or further exercise of such right or power. No waiver of any
right or power of Lender in this Agreement shall be effective unless given in
writing signed by Lender. This Agreement may not be amended or modified except
by a writing signed by the parties.
16. Expenses of Enforcement.
Borrower shall reimburse Lender on demand for any fees or other expenses of
Lender in connection with the enforcement of this Agreement and the collection
of the Loan and any other amounts due Lender hereunder. Borrower agrees, to the
fullest extent permitted by law, to indemnify and hold harmless Lender and each
of its directors, officers, employees and agents (each an “Indemnified
Party”) from and against any and all claims, damages, liabilities and
expenses (including without limitation fees and disbursements of counsel)
arising out of or in connection with any investigation, litigation or proceeding
(whether or not any Indemnified Party is a party) arising out of, related to or
in connection with this Agreement, the Loan or any transaction in which any
proceeds of all or any part of the Loan made hereunder are applied, provided that such indemnity
shall not, as to any Indemnified Party, be available to the extent that such
losses, claims, damages, liabilities or related expenses resulted from the gross
negligence, unlawful conduct or willful misconduct of such Indemnified
Party.
17. Successors and Assigns. This
Agreement shall be binding on and inure to the benefit of the parties and their
respective successors and permitted assigns. Borrower may not assign this
Agreement or delegate any of its duties hereunder without the express written
consent of Lender.
18. Governing Law. This Agreement
shall be construed in accordance with and governed by the laws of the State of
New York.
19. Headings;
Section References. Headings in this Agreement are for convenience
only and shall not be used to interpret or construe its provisions. Unless
otherwise specified, references to Sections in this Agreement are to Sections of
this Agreement.
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20. Counterparts. This Agreement
may be executed in two or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same
instrument.
21. Entire Agreement. This
instrument and any other loan documents executed in connection herewith
constitute the entire Agreement between Lender and Borrower and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements
of the parties. There are no unwritten oral agreements between the
parties.
22. Notices. All notices under
this Agreement shall be in writing and mailed, hand delivered or faxed and
confirmed to the respective parties as follows:
If to
Lender:
Enterprise
Products Operating LLC
0000
Xxxxxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Xxxxxxxxx
X. Xxxxxxxxxxx, Vice President and Assistant Corporate Secretary
If to
Borrower:
TEPPCO
Partners, L.P.
0000
Xxxxxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention
: Xxxxxxxx X. Xxxxxx, Vice President, General Counsel and
Secretary
Any party
hereto may change its address for receipt of communications by giving written
notice to the other party in accordance with this Section
22.
23. No Third Party Beneficiaries.
The agreement of Lender to make the Loan to Borrower on the terms and conditions
set forth in this Agreement is solely for the benefit of Borrower and no other
person has any rights hereunder against Lender or with respect to the extension
of credit contemplated hereby.
24. Special Exculpation. No claim
may be made by Borrower or any other person against Lender, its directors,
officers, employees, attorneys or agents of any of them for any special,
indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory of liability arising out of or relating to this
Agreement or any other financing document or the transactions contemplated
hereby or thereby, or any act, omission or event occurring in connection
therewith, and Borrower hereby waives, releases and agrees not to xxx upon any
claim for any such damages, whether or not accrued and whether or not known or
suspected to exist in its favor.
25. Waiver of Jury Trial. Each of
Borrower and Lender hereby irrevocably waives, to the fullest extent permitted
by law, any and all right to trial by jury in any legal
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proceeding arising out of
or relating to this Agreement or the transactions contemplated
hereby.
26. Severability. If any term or
provision of this Agreement shall be determined to be illegal or unenforceable,
all other terms and provisions of this Agreement shall nevertheless remain
effective and shall be enforced to the fullest extent permitted by applicable
law.
27. Further Assurances. The
parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents,
and (c) to do such other acts and things, all as the other party may
reasonably request for the purpose of carrying out the intent of this
Agreement.
28. Non-Recourse to Partners.
Lender agrees that in the event of non-performance by Borrower hereunder,
including an Event of Default, Lender’s rights to payment under this Agreement
are limited to the assets of Borrower and each Guarantor, and Lender may not
pursue payment from any general partner (including the General Partner) or
limited partner of Borrower for any amounts hereunder, even if the assets of
Borrower and amounts received pursuant to any Guaranty are collectively
insufficient to pay all amounts due to Lender under this Agreement.
(Signature
Page Follows)
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In
witness whereof the parties have caused this Agreement to be executed by their
proper officers on the day and year first above written.
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Enterprise
Products Operating LLC, as Lender
By: Enterprise
Products OLPGP, Inc.,
its managing member
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By:
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/s/ W. XXXXXXX
XXXXXX
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|
W.
Xxxxxxx Xxxxxx
|
||||
|
Executive
Vice President and Chief Financial Officer
|
||||
|
TEPPCO
Partners, L.P., as Borrower
By: Texas
Eastern Products Pipeline Company, LLC,
its general partner
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By:
|
/s/ XXXXX X.
XXXXXX
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|
Xxxxx
X. Xxxxxx
|
||||
|
Acting
Chief Financial Officer
|
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EXHIBIT A
As used
in the Agreement to which this Exhibit A is
attached, the following terms have the meanings indicated below.
“Bankruptcy
Law” means Title 11 of the United States Code entitled “Bankruptcy”, as
amended from time to time and any similar other applicable law or statute in any
other jurisdiction as amended from time to time.
“Business
Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City, New York are authorized or required by law to
remain closed; provided
that when used in connection with an Interest Period, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in U.S.
Dollar deposits in the London interbank market.
“Change of
Control” means that any one or more of the following occurs or exists:
(a) Borrower ceases to own (i) at least 99.999% of the Equity
Interests in TE Products, TCTM, or Midstream; or (ii) directly or
indirectly, 100% of the Equity Interests of TEPPCO GP; or (b) Texas Eastern,
Enterprise GP Holdings L.P. or any direct or indirect wholly owned Subsidiary of
Enterprise GP Holdings L.P. which has no other assets or businesses other than
Equity Interests of Borrower ceases to be the sole general partner of Borrower;
or (c) TEPPCO GP or any direct or indirect wholly owned Subsidiary of
Borrower which has no other assets other than Equity Interests of TE Products,
TCTM, Midstream, Jonah Gas, or any other Subsidiary of Borrower and has no
businesses other than serving as a general partner, managing member or manager
of such entities ceases to be the sole general partner, managing member or
manager of TE Products, TCTM, or Midstream; or (d) TEPPCO GP and Midstream
or any one or more direct or indirect wholly owned Subsidiaries of Borrower,
each of which has no other assets other than Equity Interests of TE Products,
TCTM, Midstream or any other Subsidiary of Borrower and has no businesses other
than serving as a general partner, managing member or manager of such entities
cease to be the sole general partners, managing members or managers of (or if
Jonah Gas has only one general partner, managing member or manager, the sole
general partner, managing member or manager of) Jonah Gas; or (e) EPCO,
Inc. or Enterprise GP Holdings L.P. ceases to own, directly or indirectly, 100%
of the Equity Interests of Texas Eastern; or (f) Midstream ceases to own
(i) at least 99.999% of the Equity Interests in Val Verde, and
(ii) 100% of the Equity Interests in TEPPCO NGL Pipelines,
LLC.
“Credit
Agreement” means the Amended And Restated Credit Agreement, dated as of
October 21, 2004, by and among Borrower, SunTrust Bank, as administrative agent,
the several banks and other financial institutions named therein, as lenders, as
amended and supplemented by (i) the First Amendment to Amended and Restated
Credit Agreement, dated as of February 23, 2005, (ii) the Second Amendment to
Amended and Restated Credit Agreement, dated as of December 13, 2005, (iii) the
Third Amendment to Amended and Restated Credit Agreement and Full Release of the
Jonah Gas Guaranty, dated as of July 31, 2006, (iv) the Fourth Amendment to
Amended and Restated Credit Agreement, dated as of June 29, 2007, (v) the Fifth
Amendment to Amended and
Restated Credit Agreement,
dated as of December 18, 2007, (vi) the Sixth Amendment to Amended and Restated
Credit Agreement, dated as of July 1, 2008, and (vii) the Supplement and Joinder
Agreement, dated as of July 17, 2008.
“Enterprise GP
Holdings L.P.” means Enterprise GP Holdings L.P., a Delaware limited
partnership.
“EPCO,
Inc.” means EPCO, Inc., a Texas corporation.
“Equity
Interests” means, (a) with respect to a corporation, shares of capital
stock of such corporation or any other interest convertible or exchangeable into
any such interest, (b) with respect to a limited liability company, a membership
interest in such company, (c) with respect to a partnership, a partnership
interest in such partnership, and (d) with respect to any other Person, an
interest in such Person analogous to interests described in clauses (a) through
(c).
“General
Partner” means Texas Eastern or any other Person that serves as the
general partner of Borrower without causing the occurrence of a Potential
Default or an Event of Default.
“Governmental
Authority” means any (a) local, state, territorial, federal or foreign
judicial, executive, regulatory, administrative, legislative or governmental
agency, board, bureau, commission, department or other instrumentality, (b)
private arbitration board or panel or (c) central bank.
“Jonah
Gas” means Jonah Gas Gathering Company, a Wyoming general
partnership.
“LIBOR
Rate” means, for a Borrowing and its Interest Period, the annual interest
rate for deposits in United States dollars of amounts equal or comparable to the
principal amount of that Borrowing offered for a term comparable to that
Interest Period, which rate appears on the Reuters Screen LIBOR 01 Page as of
11:00 a.m. (London, England time) two Business Days before the beginning of
that Interest Period. The rate so determined in accordance herewith shall be
rounded upwards to the nearest multiple of 0.001%, and the term “Reuters Screen
LIBOR 01 Page” means the display so designated on the Reuters Service (or
such other page as may replace the Reuters Screen LIBOR 01 Page on that service
or another service as may be nominated by the British Bankers’ Association as
the information vendor for the purpose of displaying British Bankers’
Association Interest Settlement Rates for United States dollars).
“Merger
Agreement” means that certain Agreement and Plan of Merger, dated as of
June 28, 2009, by and among EPD, Enterprise Products GP, LLC, a Delaware limited
liability company and the general partner of EPD, Enterprise Sub B LLC, a
Delaware limited liability company and a wholly owned subsidiary of EPD,
Borrower, and Texas Eastern Products Pipeline Company, LLC, a Delaware limited
liability company and the general partner of Borrower.
“Midstream”
means TEPPCO Midstream Companies, LLC, a Texas limited liability company and
successor by merger to TEPPCO Midstream Companies, L.P., a Texas limited
partnership and formerly a Delaware limited partnership.
“Payment
Date” means the last day of each Interest Period, commencing September 1,
2009.
“Person”
means an individual, partnership, corporation (including a business trust),
joint stock company, trust, unincorporated association, joint venture, limited
liability company or other entity, or a Governmental Authority.
“Potential
Default” means any event, occurrence or circumstance, the existence of
which upon any required notice, time lapse, or both, would become an Event of
Default.
“Subsidiary”
of any Person means any corporation, limited liability company, general or
limited partnership or other entity of which more than 50% (in number of votes)
of the Equity Interests is owned of record or beneficially, directly or
indirectly, by that Person.
“TCTM”
means TCTM, L.P., a Delaware limited partnership.
“TEPPCO NGL
Pipelines, LLC” means TEPPCO NGL Pipelines, LLC, a Delaware limited
liability company.
“TEPPCO
GP” means TEPPCO GP, Inc., a Delaware corporation.
“TE
Products” means TE Products Pipeline Company, LLC, a Texas limited
liability company and successor by merger to TE Products Pipeline Company,
Limited Partnership, a Texas limited partnership and formerly a Delaware limited
partnership.
“Texas
Eastern” means Texas Eastern Products Pipeline Company, LLC, a Delaware
limited liability company.
“Val
Verde” means Val Verde Gas Gathering Company, L.P., a Delaware limited
partnership.
EXHIBIT
B
FORM OF
GUARANTY
THIS
GUARANTY (this “Guaranty”)
is executed as of ____________ ___, by [NAME OF GUARANTOR], a ________________
(the “Guarantor”)
and a subsidiary of TEPPCO
PARTNERS, L.P., a Delaware limited partnership (the “Borrower”),
for the benefit of ENTERPRISE
PRODUCTS OPERATING LLC, a Texas limited liability company (the “Lender”).
The
Borrower and the Lender have executed that certain Loan Agreement, dated as of
August 5, 2009 (the “Loan
Agreement”). The execution and delivery of this Guaranty are conditions
precedent to the obligations of the Lender to fund Borrowings under the Loan
Agreement. All of the terms defined in the Loan Agreement have the
same meanings when used, unless otherwise defined, in this
Guaranty.
ACCORDINGLY,
for adequate and sufficient consideration, and in order to induce the Lender to
enter into and to fund Borrowings under the Loan Agreement, the Guarantor hereby
agrees as follows:
1. Guaranty.
(a) The
Guarantor hereby unconditionally and irrevocably guarantees (jointly and
severally with any other “Guarantor” under the Loan Agreement) to the Lender the
full and punctual payment when due (whether at maturity, by acceleration or
otherwise), and in the manner specified under the Loan Agreement, of (i) the
principal of any and all Borrowings, and any and all interest thereon, in each
case, when due and payable, all according to the provisions of the Loan
Agreement; and (ii) all other sums and charges which may at any time be due and
payable in accordance with the provisions of the Loan Agreement (collectively,
the “Obligations”). This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment of the Obligations (and not
of their collectibility only) and is in no way conditioned upon any other means
of obtaining their payment. Should the Borrower default in the
payment of any of the Obligations, the obligations of the Guarantor hereunder
shall become immediately due and payable to the Lender. The
obligations of the Guarantor under this Guaranty (the “Guarantor
Obligations”) are independent of the Obligations, and a separate action
or actions may be brought and prosecuted against the Guarantor to enforce this
Guaranty, irrespective of whether any action is brought against the Borrower or
any other guarantor of the Obligations or whether the Borrower or any such
guarantor is joined in any such action or actions.
(b) The
Guarantor further agrees, as the principal obligor and not as a guarantor only,
to pay to the Lender, on demand, all costs and expenses (including
Exhibit B
to Loan Agreement, Page 1
court
costs and reasonable legal expenses) incurred or expended by the Lender in
connection with the enforcement of this Guaranty.
(c) The
Guarantor hereby agrees to indemnify the Lender on demand against any loss or
liability suffered by the Lender if any of the Obligations or the Guarantor
Obligations is or becomes, unenforceable, invalid or illegal.
2. Cumulative
Rights. If the Guarantor becomes liable for any indebtedness
owing by the Borrower to the Lender, other than under this
Guaranty, that liability may not be in any manner impaired or affected by this
Guaranty. The rights of the Lender under this Guaranty are cumulative
of any and all other rights that the Lender may ever have against the
Guarantor. The exercise by the Lender of any right under this
Guaranty or otherwise does not preclude the concurrent or subsequent exercise of
any other right.
3. Limitation on
Liability. Anything in this Guaranty to the contrary
notwithstanding, the obligations of the Guarantor hereunder shall be limited to
a maximum aggregate amount equal to the greatest amount that would not render
the Guarantor’s obligations hereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any provisions of applicable state law (collectively, the “fraudulent
transfer laws”), in each case after giving effect to all other
liabilities of the Guarantor, contingent or otherwise, that are relevant under
the fraudulent transfer laws (specifically excluding, however, any liabilities
of the Guarantor (i) in respect of intercompany indebtedness to the Borrower or
affiliates of the Borrower to the extent that such indebtedness would be
discharged in an amount equal to the amount paid by the Guarantor hereunder and
(ii) under any guaranty of senior unsecured indebtedness or debt subordinated in
right of payment of the Obligations, which guaranty shall contain a limitation
as to maximum amount similar to that set forth in this Section, pursuant to
which the liability of the Guarantor hereunder is included in the liabilities
taken into account in determining such maximum amount) and after giving effect
as assets to the value (as determined under the applicable provisions of the
fraudulent transfer laws) of any rights to subrogation, contribution,
reimbursement, indemnity or similar rights of the Guarantor pursuant to (A)
applicable law or (B) any agreement providing for an equitable allocation among
the Guarantor and other affiliates of the Borrower of obligations arising under
guarantees by such parties.
4. Subordination. All
principal of and interest on all indebtedness, liabilities and obligations of
the Borrower and its subsidiaries (collectively, the “Companies”)
to the Guarantor (the “Subordinated
Debt”), whether direct, indirect, fixed, contingent, liquidated,
unliquidated, joint, several or joint and several, now or in the future
existing, due or to become due to the Guarantor, or held or to be held by the
Guarantor, whether created directly or acquired by assignment or otherwise, and
whether evidenced by written instrument or not, is expressly subordinated to the
full and final payment of the Guarantor Obligations (and the Guarantor agrees
not to accept any payment of any Subordinated Debt from the Companies) during
any period when any Event of Default or Potential Default has occurred and is
continuing. If the Guarantor receives any payment of any Subordinated
Debt in violation of the preceding subordination provision, then the Guarantor
shall hold that payment in trust for the Lender and promptly turn it over to
the
Exhibit B
to Loan Agreement, Page 2
Lender, in the form
received (with any necessary endorsements), to be applied to the Guarantor
Obligations.
5. Subrogation and
Contribution. Until the commitments of the Lender to make the
Loan pursuant to the Loan Agreement have been terminated and the Guarantor
Obligations have been fully paid and performed (a) the Guarantor may not assert,
enforce or otherwise exercise any right of subrogation to any of the rights or
liens of the Lender against the Borrower or any other obligor on the Obligations
or any collateral or other security or any right of recourse, reimbursement,
subrogation, contribution, indemnification, or similar right against the
Borrower or any other obligor on the Obligations or any guarantor thereof, (b)
the Guarantor defers all of the foregoing rights (whether they arise in equity,
under contract, by statute, under common law or otherwise), and (c) the
Guarantor defers the benefit of, and any right to participate in, any collateral
or other security given to the Lender to secure payment of any part of the
Obligations.
6. No
Release. The Guarantor’s obligations under this Guaranty shall
not be released, diminished, or impaired by the occurrence of any one or more of
the following events: (a) any taking or accepting of any other
security or assurance for the Obligations; (b) any release, surrender, exchange,
subordination, impairment, or loss of any collateral securing the Obligations;
(c) any full or partial release of the liability of any other obligor on the
Obligations (other than as the result of payment on the Obligations); (d) the
modification of, or waiver of compliance with, any terms of any the Loan
Agreement, this Guaranty or any other agreement, instrument or document
governing the transactions contemplated thereby (collectively, the “Loan
Documents”); (e) any present or future insolvency, bankruptcy, or lack of
corporate, partnership or limited liability company power of any other obligor
at any time liable for the Obligations; (f) any increase of the Obligations and
any renewal, extension or rearrangement of the Obligations or any adjustment,
indulgence, forbearance or compromise that may be granted or given by the Lender
to any other obligor on the Obligations; (g) any neglect, delay, omission,
failure or refusal of the Lender to take or prosecute any action in connection
with the Obligations; (h) any failure of the Lender to notify the Guarantor of
any renewal, extension or assignment of any part of the Obligations, or the
release of any security or of any other action taken or refrained from being
taken by the Lender against the Borrower, or any new agreement between the
Lender and the Borrower, it being understood that the Lender is not required to
give the Guarantor notice of any kind under any circumstances whatsoever with
respect to or in connection with any part of the Obligations, other than any
notice specifically required to be given to the Guarantor by applicable
statutes, laws, treaties, ordinances, rules, regulations, orders, writs,
injunctions, decrees, judgments, opinions and interpretations of any
Governmental Authority (“Legal
Requirements”) or elsewhere in this Guaranty; (i) the unenforceability of
the Obligations against any other obligor because they exceed the amount
permitted by applicable Legal Requirements, the act of creating the Obligations
is ultra xxxxx, the officers creating the Obligations exceeded their authority
or violated their fiduciary duties in connection with the Obligations, or
otherwise; or (j) any payment of any part of the Obligations to the Lender is
held to constitute a preference under any Bankruptcy Law or for any other reason
the
Exhibit B
to Loan Agreement, Page 3
Lender
is required to refund that payment or make payment to someone else (and in each
such instance this Guaranty shall be reinstated in an amount equal to that
payment).
7. Waivers. The
Guarantor waives (to the extent lawful and until full payment of the Guarantor
Obligations) all defenses to the enforcement of this Guaranty (and rights that
may be asserted as defenses to the enforcement of this Guaranty) including, but
not limited to (i) any right to revoke this Guaranty with respect to future
indebtedness arising under the Loan Agreement; (ii) any right to require the
Lender to do any of the following before the Guarantor is obligated to pay any
part of the Guarantor Obligations or before the Lender may proceed against the
Guarantor: (A) xxx or exhaust remedies against the Borrower and other guarantors
or obligors in respect of the Obligations, (B) xxx on an accrued right of action
in respect of the Obligations or bring any other action, exercise any other
right or exhaust all other remedies, or (C) enforce rights against the
Borrower’s assets or the collateral pledged by the Borrower to secure any part
of the Obligations; (iii) any right relating to the timing, manner or conduct of
the Lender’s enforcement of rights against the Borrower’s assets or the
collateral pledged by the Borrower to secure any part of the Obligations; (iv)
if the Guarantor and the Borrower (or a third party) have each pledged assets to
secure any part of the Obligations or the Guarantor Obligations, any right to
require the Lender to proceed first against the other collateral before
proceeding against collateral pledged by the Guarantor; (v) notice that this
Guaranty has been accepted by the Lender and notice of any indebtedness to which
this Guaranty may apply; (vi) any right of the Guarantor to receive notice from
the Lender of changes that affect the creditworthiness of the Borrower; and
(vii) except for any notice specifically required by this Guaranty,
presentation, presentment, demand for payment, protest, notice of protest,
notice of dishonor or nonpayment of any indebtedness, notice of intent to
accelerate, notice of acceleration, notice of any suit or other action by the
Lender against the Borrower, the Guarantor or any other Person and any notice to
any party liable for the obligation that is the subject of the suit or
action.
8. Loan Agreement
Provisions. The Guarantor acknowledges that the Borrower has
made certain representations and warranties in the Loan Agreement with respect
to the Guarantor and confirms that each such representation and warranty is true
and correct, with the same effect as set forth herein.
9. Reliance and Duty
to Remain Informed. The Guarantor confirms that it has
executed and delivered this Guaranty after reviewing the terms and conditions of
the Loan Documents and all other information as it has deemed appropriate in
order to make its own credit analysis and decision to execute and deliver this
Guaranty. The Guarantor confirms that it has made its own independent
investigation with respect to the Borrower’s creditworthiness and is not
executing and delivering this Guaranty in reliance on any representation or
warranty by the Lender as to that creditworthiness. The Guarantor
expressly assumes all responsibilities to remain informed of the financial
condition of the Borrower and any circumstances affecting the Borrower’s ability
to perform under the Loan Documents to which it is a party or any collateral
securing the Obligations.
Exhibit B
to Loan Agreement, Page 4
10. No
Reduction. Subject to Section 3 of this Guaranty, the
Guarantor Obligations may not be reduced, discharged or released because or by
reason of any existing or future offset, claim or defense (except for the
defense of complete and final payment of the Guarantor Obligations) of the
Borrower or any other obligor against the Lender or against payment of the
Guarantor Obligations, whether that offset, claim or defense arises in
connection with the Guarantor Obligations or otherwise. Those claims
and defenses include, without limitation, failure of consideration, breach of
warranty, fraud, bankruptcy, incapacity/infancy, statute of limitations, lender
liability, accord and satisfaction, usury, forged signatures, mistake,
impossibility, frustration of purpose and unconscionability.
11. Communications. For purposes of
Section 22 of the Loan Agreement, the Guarantor’s address and fax number are the
same as the Borrower.
12. Amendments,
Etc. No amendment,
waiver or discharge to or under this Guaranty is valid unless it is in writing
and is signed by the party against whom it is sought to be enforced and is
otherwise in conformity with the requirements of Section 15 of the Loan
Agreement.
13. ENTIRETY. THIS
GUARANTY REPRESENTS THE FINAL AGREEMENT AMONG THE GUARANTOR AND THE LENDER WITH
RESPECT TO THE SUBJECT MATTER OF THIS GUARANTY AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE
PARTIES.
14. Parties. This
Guaranty benefits the Lender and its successors and permitted assigns and binds
the Guarantor and its successors and assigns. The rights of the
Lender under this Guaranty may be transferred with any permitted assignment of
the Obligations. The Loan Agreement contains provisions governing
assignments of the Obligations and of rights and obligations under this
Guaranty.
15. Governing
Law. This Guaranty shall be governed by, and construed in
accordance with, the law of the State of New York and the United States of
America.
(Signature
Page Follows)
Exhibit B
to Loan Agreement, Page 5
EXECUTED
as of the date first stated in this Guaranty.
| [NAME OF GUARANTOR] |
|
|
By
|
| Name: | |
| Title: |
Signature
Page to Guaranty
