EXECUTION COPY
SUBSIDIARY GUARANTY
Dated as of June 28, 2004
From
THE GUARANTORS NAMED HEREIN
and
THE ADDITIONAL GUARANTORS REFERRED TO HEREIN
as Guarantors
in favor of
THE SECURED PARTIES REFERRED TO IN
THE CREDIT AGREEMENT REFERRED TO HEREIN
T A B L E O F C O N T E N T S
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SECTION PAGE
Section 1. Guaranty; Limitation of Liability.................................1
Section 2. Guaranty Absolute.................................................2
Section 3. Waivers and Acknowledgments.......................................3
Section 4. Subrogation.......................................................4
Section 5. Payments Free and Clear of Taxes, Etc.............................5
Section 6. Representations and Warranties....................................7
Section 7. Covenants.........................................................7
Section 8. Amendments, Guaranty Supplements, Etc.............................7
Section 9. Notices, Etc......................................................8
Section 10. No Waiver; Remedies...............................................8
Section 11. Right of Set-off..................................................8
Section 12. Indemnification...................................................9
Section 13. Subordination.....................................................9
Section 14. Continuing Guaranty; Assignments under the Credit Agreement......10
Section 15. Execution in Counterparts........................................11
Section 16. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc...........11
Exhibit A - Guaranty Supplement
SUBSIDIARY GUARANTY
SUBSIDIARY GUARANTY dated as of June 28, 2004 made by the Persons listed on
the signature pages hereof under the caption "Subsidiary Guarantors" and the
Additional Guarantors (as defined in Section 8(b)) (such Persons so listed and
the Additional Guarantors being, collectively, the "Guarantors" and,
individually, each a "Guarantor") in favor of the Secured Parties (as defined in
the Credit Agreement referred to below).
PRELIMINARY STATEMENT. Xxxx True Temper, Inc., a Delaware corporation (the
"BORROWER"), is party to a Credit Agreement dated as of June 28, 2004 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "CREDIT AGREEMENT"; the capitalized terms defined therein and not
otherwise defined herein being used herein as therein defined) with ATT Holding
Co., a Delaware corporation, as Guarantor, certain Lenders party thereto and
Bank of America, N.A., as Administrative Agent for such Lenders. Each Guarantor
will derive substantial direct and indirect benefits from the transactions
contemplated by the Credit Agreement. It is a condition precedent to the making
of Loans by the Lenders and the issuance of Letters of Credit by the L/C Issuer
under the Credit Agreement and the entry by the Hedge Banks into Secured Hedge
Agreements from time to time that each Guarantor shall have executed and
delivered this Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to induce the
Lenders to make Loans and the L/C Issuer to issue Letters of Credit under the
Credit Agreement and the Hedge Banks to enter into Secured Hedge Agreements from
time to time, each Guarantor, jointly and severally with each other Guarantor,
hereby agrees as follows:
Section 1. Guaranty; Limitation of Liability. (a) Each Guarantor hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment when
due, whether at scheduled maturity or on any date of a required prepayment or by
acceleration, demand or otherwise, of all Obligations of each other Loan Party
now or hereafter existing under or in respect of the Loan Documents (including,
without limitation, any extensions, modifications, substitutions, amendments or
renewals of any or all of the foregoing Obligations), whether direct or
indirect, absolute or contingent, and whether for principal, interest, premiums,
fees, indemnities, contract causes of action, costs, expenses or otherwise (such
Obligations being the "GUARANTEED OBLIGATIONS"), and agrees to pay any and all
expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Administrative Agent or any other Secured Party in
enforcing any rights under this Guaranty or any other Loan Document. Without
limiting the generality of the foregoing, each Guarantor's liability shall
extend to all amounts that constitute part of the Guaranteed Obligations and
would be owed by any other Loan Party to any Secured Party under or in respect
of the Loan Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.
(b) Each Guarantor, and by its acceptance of this Guaranty, the
Administrative Agent and each other Secured Party, hereby confirms that it is
the intention of all such Persons that this Guaranty and the Obligations of each
Guarantor hereunder not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law (as hereinafter defined), the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
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foreign, federal or state law to the extent applicable to this Guaranty and the
Obligations of each Guarantor hereunder. To effectuate the foregoing intention,
the Administrative Agent, the other Secured Parties and the Guarantors hereby
irrevocably agree that the Obligations of each Guarantor under this Guaranty at
any time shall be limited to the maximum amount as will result in the
Obligations of such Guarantor under this Guaranty not constituting a fraudulent
transfer or conveyance. For purposes hereof, "BANKRUPTCY LAW" means any
proceeding of the type referred to in Section 9.01(f) of the Credit Agreement or
Title 11, U.S. Code, or any similar foreign, federal or state law for the relief
of debtors.
(c) Each Guarantor hereby unconditionally and irrevocably agrees that in
the event any payment shall be required to be made to any Secured Party under
this Guaranty or the Holdings Guaranty or any other guaranty, such Guarantor
will contribute, to the maximum extent permitted by law, such amounts to each
other Guarantor and Holdings and each other guarantor so as to maximize the
aggregate amount paid to the Secured Parties under or in respect of the Loan
Documents.
Section 2. Guaranty Absolute. Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Loan
Documents, regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of any Secured
Party with respect thereto. The Obligations of each Guarantor under or in
respect of this Guaranty are independent of the Guaranteed Obligations or any
other Obligations of any other Loan Party under or in respect of the Loan
Documents, and a separate action or actions may be brought and prosecuted
against each Guarantor to enforce this Guaranty, irrespective of whether any
action is brought against the Borrower or any other Loan Party or whether the
Borrower or any other Loan Party is joined in any such action or actions. The
liability of each Guarantor under this Guaranty shall be irrevocable, absolute
and unconditional irrespective of, and each Guarantor hereby irrevocably waives
any defenses it may now have or hereafter acquire in any way relating to, any or
all of the following:
(a) any lack of validity or enforceability of any Loan Document or any
agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any other
term of, all or any of the Guaranteed Obligations or any other Obligations of
any other Loan Party under or in respect of the Loan Documents, or any other
amendment or waiver of or any consent to departure from any Loan Document,
including, without limitation, any increase in the Guaranteed Obligations
resulting from the extension of additional credit to any Loan Party or any of
its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any Collateral or
any other collateral, or any taking, release or amendment or waiver of, or
consent to departure from, any other guaranty, for all or any of the Guaranteed
Obligations;
(d) any manner of application of Collateral or any other collateral, or
proceeds thereof, to all or any of the Guaranteed Obligations, or any manner of
sale or other disposition of any Collateral or any other
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collateral for all or any of the Guaranteed Obligations or any other Obligations
of any Loan Party under the Loan Documents or any other assets of any Loan Party
or any of its Subsidiaries;
(e) any change, restructuring or termination of the corporate structure or
existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan Party any
information relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party now or
hereafter known to such Secured Party (each Guarantor waiving any duty on the
part of the Secured Parties to disclose such information);
(g) the failure of any other Person to execute or deliver this Guaranty,
any Guaranty Supplement (as hereinafter defined) or any other guaranty or
agreement or the release or reduction of liability of any Guarantor or other
guarantor or surety with respect to the Guaranteed Obligations; or
(h) any other circumstance (including, without limitation, any statute of
limitations) or any existence of or reliance on any representation by any
Secured Party that might otherwise constitute a defense available to, or a
discharge of, any Loan Party or any other guarantor or surety.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by any Secured Party or any other Person upon the
insolvency, bankruptcy or reorganization of the Borrower or any other Loan Party
or otherwise, all as though such payment had not been made.
Section 3. Waivers and Acknowledgments. (a) Each Guarantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Guaranteed Obligations and this Guaranty and any requirement that any
Secured Party protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Loan Party
or any other Person or any Collateral.
(b) Each Guarantor hereby unconditionally and irrevocably waives any right
to revoke this Guaranty and acknowledges that this Guaranty is continuing in
nature and applies to all Guaranteed Obligations, whether existing now or in the
future.
(c) Each Guarantor hereby unconditionally and irrevocably waives (i) any
defense arising by reason of any claim or defense based upon an election of
remedies by any Secured Party that in any manner impairs, reduces, releases or
otherwise adversely affects the subrogation, reimbursement, exoneration,
contribution or indemnification rights of such Guarantor or other rights of such
Guarantor to proceed against any of the other Loan Parties, any other guarantor
or any other Person or any Collateral and (ii) any defense based on any right of
set-off or counterclaim against or in respect of the Obligations of such
Guarantor hereunder.
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(d) Each Guarantor acknowledges that the Collateral Agent may, without
notice to or demand upon such Guarantor and without affecting the liability of
such Guarantor under this Guaranty, foreclose under any mortgage by nonjudicial
sale, and each Guarantor hereby waives any defense to the recovery by the
Collateral Agent and the other Secured Parties against such Guarantor of any
deficiency after such nonjudicial sale and any defense or benefits that may be
afforded by applicable law.
(e) Each Guarantor hereby unconditionally and irrevocably waives any duty
on the part of any Secured Party to disclose to such Guarantor any matter, fact
or thing relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party or any
of its Subsidiaries now or hereafter known by such Secured Party.
(f) Each Guarantor acknowledges that it will receive substantial direct and
indirect benefits from the financing arrangements contemplated by the Loan
Documents and that the waivers set forth in Section 2 and this Section 3 are
knowingly made in contemplation of such benefits.
Section 4. Subrogation. Each Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against the Borrower, any other Loan Party or any other insider
guarantor that arise from the existence, payment, performance or enforcement of
such Guarantor's Obligations under or in respect of this Guaranty or any other
Loan Document, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of any Secured Party against the Borrower,
any other Loan Party or any other insider guarantor or any Collateral, whether
or not such claim, remedy or right arises in equity or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Borrower, any other Loan Party or any other insider guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim, remedy or right, unless and until
all of the Guaranteed Obligations and all other amounts payable under this
Guaranty shall have been paid in full in cash, all Letters of Credit and all
Secured Hedge Agreements shall have expired or been terminated or Cash
Collateralized and the Commitments shall have expired or been terminated. If any
amount shall be paid to any Guarantor in violation of the immediately preceding
sentence at any time prior to the latest of (a) the payment in full in cash of
the Guaranteed Obligations and all other amounts payable under this Guaranty,
(b) the Maturity Date and (c) the latest date of expiration, termination or Cash
Collateralization of all Letters of Credit and all Secured Hedge Agreements,
such amount shall be received and held in trust for the benefit of the Secured
Parties, shall be segregated from other property and funds of such Guarantor and
shall forthwith be paid or delivered to the Administrative Agent in the same
form as so received (with any necessary endorsement or assignment) to be
credited and applied to the Guaranteed Obligations and all other amounts payable
under this Guaranty, whether matured or unmatured, in accordance with the terms
of the Loan Documents, or to be held as Collateral for any Guaranteed
Obligations or other amounts payable under this Guaranty thereafter arising. If
(i) any Guarantor shall make payment to any Secured Party of all or any part of
the Guaranteed Obligations, (ii) all of the Guaranteed Obligations and all other
amounts payable under this Guaranty shall have been paid in full in cash, (iii)
the Maturity Date shall have occurred and (iv) all Letters of Credit and all
Secured
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Hedge Agreements shall have expired, been terminated or Cash Collateralized, the
Secured Parties will, at such Guarantor's request and expense, execute and
deliver to such Guarantor appropriate documents, without recourse and without
representation or warranty, necessary to evidence the transfer by subrogation to
such Guarantor of an interest in the Guaranteed Obligations resulting from such
payment made by such Guarantor pursuant to this Guaranty.
Section 5. Payments Free and Clear of Taxes, Etc. (a) Any and all payments
made by any Guarantor under or in respect of this Guaranty or any other Loan
Document shall be made, in accordance with Section 2.12 of the Credit Agreement,
free and clear of and without deduction for any Indemnified Taxes or Other
Taxes. If any Guarantor shall be required by law to deduct any Indemnified Taxes
or Other Taxes from or in respect of any sum payable under or in respect of this
Guaranty or any other Loan Document to any Secured Party, (i) the sum payable by
such Guarantor shall be increased as may be necessary so that after such
Guarantor and the Administrative Agent have made all required deductions
(including deductions applicable to additional sums payable under this Section
5), such Secured Party receives an amount equal to the sum it would have
received had no such deductions been made, (ii) such Guarantor shall make all
such deductions and (iii) such Guarantor shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
law.
(b) In addition, each Guarantor agrees to pay any Other Taxes that arise
from any payment made by or on behalf of such Guarantor under or in respect of
this Guaranty or any other Loan Document or from the execution, delivery or
registration of, performance under, or otherwise with respect to, this Guaranty
and the other Loan Documents.
(c) Each Guarantor will indemnify each Secured Party for and hold it
harmless against the full amount of Taxes and Other Taxes, and for the full
amount of Indemnified Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 5, imposed on or paid by such Secured Party
and any liability (including penalties, additions to tax, interest and expenses)
arising therefrom or with respect thereto. This indemnification shall be made
within 10 days from the date such Secured Party makes written demand therefor
setting forth in reasonable detail the amount of such Indemnified Taxes or Other
Taxes and the circumstances giving rise thereto, which written demand shall be
conclusive absent manifest error.
(d) Within 30 days after the date of any payment of Indemnified Taxes or
Other Taxes by or on behalf of any Guarantor, such Guarantor shall furnish to
the Administrative Agent, at its address referred to in Section 9, the original
or a certified copy of a receipt evidencing such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.
(e) For purposes of this Section 5, the terms "UNITED STATES" and "UNITED
STATES PERSON" shall have the meanings specified in Section 7701 of the Internal
Revenue Code. Upon the reasonable request in writing of any Guarantor, each
Secured Party organized under the laws of a jurisdiction outside the United
States shall, on or prior to the date of its execution and delivery of the
Credit Agreement in the case of each Lender or the L/C Issuer, as the case may
be, and on or prior to the date of the Assignment and Acceptance or Secured
Hedge Agreement pursuant to which it becomes a Secured Party in the case of each
other Secured Party, and from
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time to time thereafter upon the reasonable request in writing by any Guarantor
(but only so long thereafter as such Secured Party remains lawfully able to do
so), provide each of the Administrative Agent and such Guarantor with two
original duly completed and executed Internal Revenue Service forms W-8BEN or
W-8ECI, as appropriate, or (in the case of a Secured Party that has certified in
writing to the Administrative Agent that it is not a "bank" as defined in
Section 881(c)(3)(A) of the Internal Revenue Code) form W-8BEN (and, if such
Secured Party delivers a form W-8BEN, a certificate representing that such
Secured Party is not a "bank" for purposes of Section 881(c) of the Internal
Revenue Code, is not a 10-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of the Borrower and is not a
controlled foreign corporation related to the Borrower (within the meaning of
Section 864(d)(4) of the Internal Revenue Code)), as appropriate, or any
successor or other form prescribed by the Internal Revenue Service, certifying
that such Secured Party is exempt from or entitled to a reduced rate of United
States withholding tax on all payments under the Credit Agreement, or the Notes
and any other Loan Document or, in the case of a Secured Party providing a form
W-8BEN, certifying that such Secured Party is a foreign corporation,
partnership, estate or trust. If the forms provided by a Secured Party at the
time such Secured Party first becomes a party to the Credit Agreement or the
applicable Secured Hedge Agreement indicate a United States withholding tax rate
in excess of zero, withholding tax at such rate shall be considered excluded
from Indemnified Taxes unless and until such Secured Party provides the
appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such forms; provided, however, that if, in the case of a Secured
Party becoming a party to the Credit Agreement, at the date of the Assignment
and Acceptance pursuant to which a Secured Party becomes a party to the Credit
Agreement, the Secured Party assignor was entitled to payments under subsection
(a) of this Section 5 in respect of United States withholding tax with respect
to interest paid at such date, then, to such extent, the term Indemnified Taxes
shall include (in addition to withholding taxes that may be imposed in the
future or other amounts otherwise includable in Taxes) United States withholding
tax, if any, applicable with respect to the Secured Party assignee on such date.
If any form or document referred to in this subsection (e) and requested by any
Guarantor pursuant to this subsection (e) requires the disclosure of
information, other than information necessary to compute the tax payable and
information required on the date hereof by Internal Revenue Service form W-8BEN
or W-8ECI (or the related certificate described above), that the applicable
Secured Party reasonably considers to be confidential, such Secured Party shall
give notice thereof to the applicable Guarantor and shall not be obligated to
include in such form or document such confidential information.
(f) For any period with respect to which a Secured Party has failed to
provide any Guarantor following such Guarantor's request therefor pursuant to
subsection (e) above with the appropriate form described in subsection (e) above
(other than if such failure is due to a change in law occurring after the date
on which a form originally was required to be provided or if such form otherwise
is not required under subsection (e) above), such Secured Party shall not be
entitled to indemnification under subsection (a) or (c) of this Section 5 with
respect to Indemnified Taxes imposed by the United States by reason of such
failure; provided, however, that should a Secured Party become subject to
Indemnified Taxes because of its failure to deliver a form required and at such
Secured Party's sole expense, hereunder, such Guarantor shall take such steps as
such Secured Party shall reasonably request to assist such Secured Party to
recover such Taxes.
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(g) Any Secured Party claiming any additional amounts payable pursuant to
this Section 5 agrees to use reasonable efforts (consistent with its internal
policy and legal and regulatory restrictions) to change the jurisdiction of its
Eurodollar Lending Office if the making of such a change would avoid the need
for, or reduce the amount of, any such additional amounts that may thereafter
accrue and would not, in the reasonable judgment of such Secured Party, be
otherwise disadvantageous to such Secured Party.
(h) If any Secured Party determines, in its sole discretion, that it has
actually realized, by reason of a refund, deduction or credit of any Indemnified
Taxes or Other Taxes paid or reimbursed by any Guarantor pursuant to this
Section 5 in respect of payments under the Loan Documents, a current monetary
benefit that it would otherwise not have obtained, and that would result in the
total payments under this Section 5 exceeding the amount needed to make such
Secured Party whole, such Secured Party shall pay to such Guarantor, with
reasonable promptness following the date on which it actually realizes such
benefit, an amount equal to the lesser of the amount of such benefit or the
amount of such excess, in each case net of all out-of-pocket expenses in
securing such refund, deduction or credit.
Section 6. Representations and Warranties. Each Guarantor hereby makes each
representation and warranty made in the Loan Documents by the Borrower with
respect to such Guarantor and each Guarantor hereby further represents and
warrants as follows:
(a) There are no conditions precedent to the effectiveness of this Guaranty
that have not been satisfied or waived.
(b) Such Guarantor has, independently and without reliance upon any Secured
Party and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Guaranty and each
other Loan Document to which it is or is to be a party, and such Guarantor has
established adequate means of obtaining from each other Loan Party on a
continuing basis information pertaining to, and is now and on a continuing basis
will be completely familiar with, the business, condition (financial or
otherwise), operations, performance, properties and prospects of such other Loan
Party.
Section 7. Covenants. Each Guarantor covenants and agrees that, so long as
any part of the accrued Guaranteed Obligations shall remain unpaid, any Letter
of Credit shall be outstanding and not Cash Collateralized, any Lender shall
have any Commitment or any Secured Hedge Agreement shall be in effect, such
Guarantor will perform and observe, and cause each of its Subsidiaries to
perform and observe, all of the terms, covenants and agreements set forth in the
Loan Documents on its or their part to be performed or observed or that the
Borrower has agreed to cause such Guarantor or such Subsidiaries to perform or
observe.
Section 8. Amendments, Guaranty Supplements, Etc. (a) No amendment or
waiver of any provision of this Guaranty and no consent to any departure by any
Guarantor therefrom shall in any event be effective unless the same shall be in
writing and signed by the Administrative Agent, the Required Lenders and the
Guarantors (except as otherwise expressly provided in the Credit Agreement), and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that no amendment,
waiver or consent shall, unless in writing and signed by all of the Secured
Parties
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(other than any Lender that is, at such time, a Defaulting Lender), (a) reduce
or limit the obligations of any Guarantor hereunder, release any Guarantor
hereunder or otherwise limit any Guarantor's liability with respect to the
Obligations owing to the Secured Parties under or in respect of the Loan
Documents except as provided in the next succeeding sentence, (b) postpone any
date fixed for payment hereunder or (c) change the number of Secured Parties or
the percentage of (x) the Commitments, (y) the aggregate unpaid principal amount
of the Loans or (z) the aggregate L/C Obligations that, in each case, shall be
required for the Secured Parties or any of them to take any action hereunder.
(b) Upon the execution and delivery by any Person of a guaranty supplement
in substantially the form of Exhibit A hereto (each, a "GUARANTY SUPPLEMENT"),
(i) such Person shall be referred to as an "ADDITIONAL Guarantor" and shall
become and be a Guarantor hereunder, and each reference in this Guaranty to a
"GUARANTOR" shall also mean and be a reference to such Additional Guarantor, and
each reference in any other Loan Document to a "SUBSIDIARY GUARANTOR" shall also
mean and be a reference to such Additional Guarantor, and (ii) each reference
herein to "THIS GUARANTY", "HEREUNDER", "HEREOF" or words of like import
referring to this Guaranty, and each reference in any other Loan Document to the
"SUBSIDIARY GUARANTY", "THEREUNDER", "THEREOF" or words of like import referring
to this Guaranty, shall mean and be a reference to this Guaranty as supplemented
by such Guaranty Supplement.
Section 9. Notices, Etc. All notices and other communications provided for
hereunder shall be in writing (including telecopy communication) and mailed (by
certified or registered mail), telecopied, or delivered to it, if to any
Guarantor, addressed to it in care of the Borrower at the Borrower's address
specified in Section 11.02 of the Credit Agreement, if to any Agent or any
Lender, at its address specified in Section 11.02 of the Credit Agreement, if to
any Hedge Bank, at its address specified in the Secured Hedge Agreement to which
it is a party, or, as to any party, at such other address as shall be designated
by such party in a written notice to each other party. All such notices and
other communications shall, when mailed or telecopied, be effective when
deposited in the mails or transmitted by telecopier respectively. Delivery by
telecopier of an executed counterpart of a signature page to any amendment or
waiver of any provision of this Guaranty or of any Guaranty Supplement to be
executed and delivered hereunder shall be effective as delivery of an original
executed counterpart thereof.
Section 10. No Waiver; Remedies. No failure on the part of any Secured
Party to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
Section 11. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 9.02 of the Credit Agreement to
authorize the Administrative Agent to declare the Notes due and payable pursuant
to the provisions of said Section 9.02, each Agent and each Lender and each of
their respective Affiliates is hereby authorized at any time and from time to
time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Agent, such Lender or such
Affiliate to or for the credit or the account of any
9
Guarantor against any and all of the Obligations of such Guarantor now or
hereafter existing under the Loan Documents, irrespective of whether such Agent
or such Lender shall have made any demand under this Guaranty or any other Loan
Document and although such Obligations may be unmatured. Each Agent and each
Lender agrees promptly to notify such Guarantor after any such set-off and
application; provided, however, that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Agent
and each Lender and their respective Affiliates under this Section are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) that such Agent, such Lender and their respective Affiliates
may have.
Section 12. Indemnification. (a) Without limitation on any other
Obligations of any Guarantor or remedies of the Secured Parties under this
Guaranty, each Guarantor shall, to the fullest extent permitted by law,
indemnify, defend and save and hold harmless each Secured Party and each of
their Affiliates and their respective officers, directors, employees, agents and
advisors (each, an "INDEMNIFIED PARTY") from and against, and shall pay on
demand, any and all claims, damages, losses, liabilities and expenses
(including, without limitation, reasonable fees and expenses of counsel) that
may be incurred by or asserted or awarded against any Indemnified Party in
connection with or as a result of any failure of any Guaranteed Obligations to
be the legal, valid and binding obligations of any Loan Party enforceable
against such Loan Party in accordance with their terms, provided that such
indemnity shall not, as to any Indemnified Party, be available to the extent
that such claims, damages or losses, liabilities, and expenses are determined by
a court of competent jurisdiction by final non-appealable judgment to have
resulted from the gross negligence, willful misconduct or bad faith of such
Indemnified Party.
(b) Each Guarantor hereby also agrees that none of the Indemnified Parties
shall have any liability (whether direct or indirect, in contract, tort or
otherwise) to any of the Guarantors or any of their respective Affiliates or any
of their respective officers, directors, employees, agents and advisors, and
each Guarantor hereby agrees not to assert any claim against any Indemnified
Party on any theory of liability, for special, indirect, consequential or
punitive damages arising out of or otherwise relating to the Facilities, the
actual or proposed use of the proceeds of the Loans or the Letters of Credit,
the Loan Documents or any of the transactions contemplated by the Loan
Documents.
(c) Without prejudice to the survival of any of the other agreements of any
Guarantor under this Guaranty or any of the other Loan Documents, the agreements
and obligations of each Guarantor contained in Section 1(a) (with respect to
enforcement expenses), the last sentence of Section 2, Section 5 and this
Section 12 shall survive the payment in full of the Guaranteed Obligations and
all of the other amounts payable under this Guaranty.
Section 13. Subordination. Each Guarantor hereby subordinates any and all
debts, liabilities and other Obligations owed to such Guarantor by each other
Loan Party (the "SUBORDINATED OBLIGATIONS") to the Guaranteed Obligations to the
extent and in the manner hereinafter set forth in this Section 13:
(a) Prohibited Payments, Etc. Except during the continuance of a Default
(including the commencement and continuation of any proceeding under any
Bankruptcy Law relating to any other Loan Party), each Guarantor may receive
regularly scheduled payments
10
from any other Loan Party on account of the Subordinated Obligations. After the
occurrence and during the continuance of any Default (including the commencement
and continuation of any proceeding under any Bankruptcy Law relating to any
other Loan Party), however, unless the Administrative Agent otherwise agrees, no
Guarantor shall demand, accept or take any action to collect any payment on
account of the Subordinated Obligations.
(b) Prior Payment of Guaranteed Obligations. In any proceeding under any
Bankruptcy Law relating to any other Loan Party, each Guarantor agrees that the
Secured Parties shall be entitled to receive payment in full in cash of all
Guaranteed Obligations (including all interest and expenses accruing after the
commencement of a proceeding under any Bankruptcy Law, whether or not
constituting an allowed claim in such proceeding ("POST PETITION INTEREST"))
before such Guarantor receives payment of any Subordinated Obligations.
(c) Turn-Over. After the occurrence and during the continuance of any
Default (including the commencement and continuation of any proceeding under any
Bankruptcy Law relating to any other Loan Party), each Guarantor shall, if the
Administrative Agent so requests, collect, enforce and receive payments on
account of the Subordinated Obligations as trustee for the Secured Parties and
deliver such payments to the Administrative Agent on account of the Guaranteed
Obligations (including all Post Petition Interest), together with any necessary
endorsements or other instruments of transfer, but without reducing or affecting
in any manner the liability of such Guarantor under the other provisions of this
Guaranty.
(d) Administrative Agent Authorization. After the occurrence and during the
continuance of any Default (including the commencement and continuation of any
proceeding under any Bankruptcy Law relating to any other Loan Party), the
Administrative Agent is authorized and empowered (but without any obligation to
so do), in its discretion, (i) in the name of each Guarantor, to collect and
enforce, and to submit claims in respect of, Subordinated Obligations and to
apply any amounts received thereon to the Guaranteed Obligations (including any
and all Post Petition Interest), and (ii) to require each Guarantor (A) to
collect and enforce, and to submit claims in respect of, Subordinated
Obligations and (B) to pay any amounts received on such obligations to the
Administrative Agent for application to the Guaranteed Obligations (including
any and all Post Petition Interest).
Section 14. Continuing Guaranty; Assignments under the Credit Agreement.
(a) This Guaranty is a continuing guaranty and shall (i) remain in full force
and effect until the latest of (A) the payment in full in cash of the Guaranteed
Obligations and all other amounts payable under this Guaranty, (B) the Maturity
Date and (C) the latest date of expiration or termination or Cash
Collateralization of all Letters of Credit and all Secured Hedge Agreements,
(ii) be binding upon the Guarantor, its successors and assigns and (iii) inure
to the benefit of and be enforceable by the Secured Parties and their
successors, transferees and assigns. Without limiting the generality of clause
(iii) of the immediately preceding sentence, any Secured Party may assign or
otherwise transfer all or any portion of its rights and obligations under the
Credit Agreement (including, without limitation, all or any portion of its
Commitments, the Loans owing to it and the Note or Notes held by it) to any
other Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party herein or otherwise,
in each case as and to the extent provided in Section 11.06 of the Credit
Agreement. Subject to
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Section 7.04 of the Credit Agreement, no Guarantor shall have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Secured Parties.
(b) Any Guarantor ceasing to be a Subsidiary as a result of a transaction
not prohibited by the Loan Documents shall be automatically released from the
Guaranty.
Section 15. Execution in Counterparts. This Guaranty and each amendment,
waiver and consent with respect hereto may be executed in any number of
counterparts and by different parties thereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Guaranty by telecopier shall be
effective as delivery of an original executed counterpart of this Guaranty.
Section 16. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a)
This Guaranty shall be governed by, and construed in accordance with, the laws
of the State of New York.
(b) Each Guarantor hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or federal court of the United States of America sitting in New York City,
and any appellate court from any thereof, in any action or proceeding arising
out of or relating to this Guaranty or any of the other Loan Documents to which
it is or is to be a party, or for recognition or enforcement of any judgment,
and each Guarantor hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined in any
such New York State court or, to the extent permitted by law, in such federal
court. Each Guarantor agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Guaranty or any other Loan Document shall affect any right that any party may
otherwise have to bring any action or proceeding relating to this Guaranty or
any other Loan Document in the courts of any jurisdiction.
(c) Each Guarantor irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Guaranty or any of the other Loan Documents to which
it is or is to be a party in any New York State or federal court. Each Guarantor
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such suit, action or proceeding
in any such court.
(d) EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES
OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
XXXX TRUE TEMPER PROPERTIES, INC.
By /s/ Xxxx Xxxxxxxxx
------------------------------
Title: Chief Financial Officer
1
EXHIBIT A
TO THE
SUBSIDIARY GUARANTY
FORM OF SUBSIDIARY GUARANTY SUPPLEMENT
_________ __, ____
Bank of America, N.A., as Administrative Agent
[Address of Administrative Agent]
Attention: _________
Credit Agreement dated as of _________ __, 2004 among
Xxxx True Temper, Inc., a Delaware corporation (the "BORROWER"),
ATT Holding Co., a Delaware corporation, the Lenders party to the
Credit Agreement and Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to the above-captioned Credit Agreement and to the
Subsidiary Guaranty referred to therein (such Subsidiary Guaranty, as in effect
on the date hereof and as it may hereafter be amended, supplemented or otherwise
modified from time to time, together with this Guaranty Supplement, being the
"SUBSIDIARY GUARANTY"). The capitalized terms defined in the Subsidiary Guaranty
or in the Credit Agreement and not otherwise defined herein are used herein as
therein defined.
(1) Guaranty; Limitation of Liability. (a) The undersigned hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment when
due, whether at scheduled maturity or on any date of a required prepayment or by
acceleration, demand or otherwise, of all Obligations of each other Loan Party
now or hereafter existing under or in respect of the Loan Documents (including,
without limitation, any extensions, modifications, substitutions, amendments or
renewals of any or all of the foregoing Obligations), whether direct or
indirect, absolute or contingent, and whether for principal, interest, premium,
fees, indemnities, contract causes of action, costs, expenses or otherwise (such
Obligations being the "GUARANTEED OBLIGATIONS"), and agrees to pay any and all
expenses (including, without limitation, reasonable fees and expenses of
counsel) incurred by the Administrative Agent or any other Secured Party in
enforcing any rights under this Guaranty Supplement, the Subsidiary Guaranty or
any other Loan Document. Without limiting the generality of the foregoing, the
undersigned's liability shall extend to all amounts that constitute part of the
Guaranteed Obligations and would be owed by any other Loan Party to any Secured
Party under or in respect of the Loan Documents but for the fact that they are
unenforceable or not allowable due to the existence of a bankruptcy,
reorganization or similar proceeding involving such other Loan Party.
(b) The undersigned, and by its acceptance of this Guaranty Supplement, the
Administrative Agent and each other Secured Party, hereby confirms that it is
the intention of all such Persons that this Guaranty Supplement, the Subsidiary
Guaranty and the Obligations of the undersigned hereunder and thereunder not
constitute a fraudulent transfer or conveyance for
2
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state law to the
extent applicable to this Guaranty Supplement, the Subsidiary Guaranty and the
Obligations of the undersigned hereunder and thereunder. To effectuate the
foregoing intention, the Administrative Agent, the other Secured Parties and the
undersigned hereby irrevocably agree that the Obligations of the undersigned
under this Guaranty Supplement and the Subsidiary Guaranty at any time shall be
limited to the maximum amount as will result in the Obligations of the
undersigned under this Guaranty Supplement and the Subsidiary Guaranty not
constituting a fraudulent transfer or conveyance.
(c) The undersigned hereby unconditionally and irrevocably agrees that in
the event any payment shall be required to be made to any Secured Party under
this Guaranty Supplement, the Subsidiary Guaranty, or the Holdings Guaranty or
any other guaranty, the undersigned will contribute, to the maximum extent
permitted by applicable law, such amounts to each other Guarantor and each other
guarantor so as to maximize the aggregate amount paid to the Secured Parties
under or in respect of the Loan Documents.
(2) Obligations Under the Guaranty. The undersigned hereby agrees, as of
the date first above written, to be bound as a Guarantor by all of the terms and
conditions of the Subsidiary Guaranty to the same extent as each of the other
Guarantors thereunder. The undersigned further agrees, as of the date first
above written, that each reference in the Subsidiary Guaranty to an "ADDITIONAL
GUARANTOR" or a "GUARANTOR" shall also mean and be a reference to the
undersigned, and each reference in any other Loan Document to a "SUBSIDIARY
GUARANTOR" or a "LOAN PARTY" shall also mean and be a reference to the
undersigned.
(3) Representations and Warranties. The undersigned hereby makes each
representation and warranty set forth in Section 6 of the Subsidiary Guaranty to
the same extent as each other Guarantor.
(4) Delivery by Telecopier. Delivery of an executed counterpart of a
signature page to this Guaranty Supplement by telecopier shall be effective as
delivery of an original executed counterpart of this Guaranty Supplement.
(5) Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a) This
Guaranty Supplement shall be governed by, and construed in accordance with, the
laws of the State of New York.
(b) The undersigned hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or any federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Guaranty Supplement, the Subsidiary Guaranty
or any of the other Loan Documents to which it is or is to be a party, or for
recognition or enforcement of any judgment, and the undersigned hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. The undersigned
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Guaranty Supplement or the
Subsidiary Guaranty
3
or any other Loan Document shall affect any right that any party may otherwise
have to bring any action or proceeding relating to this Guaranty Supplement, the
Subsidiary Guaranty or any of the other Loan Documents to which it is or is to
be a party in the courts of any other jurisdiction.
(c) The undersigned irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Guaranty Supplement, the Subsidiary Guaranty or any
of the other Loan Documents to which it is or is to be a party in any New York
State or federal court. The undersigned hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such suit, action or proceeding in any such court.
(d) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES
OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT THEREOF.
Very truly yours,
[NAME OF ADDITIONAL GUARANTOR]
By:
---------------------------
Name:
Title:
