Exhibit 10.21
GUARANTEE BY BARNEYS NEW YORK, INC.
THIS GUARANTEE (the "GUARANTEE") dated as of January 28, 1999 is made by
BARNEYS NEW YORK, INC., (the "GUARANTOR"), a Delaware corporation having its
office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, in favor of BI
Equipment Lessors, LLC, a California limited liability corporation
("GUARANTIED PARTY").
W I T N E S S E T H:
WHEREAS, Barney's, Inc. (the "COMPANY") issued that certain Subordinated
Note dated January 28, 1999 in the principal amount of $34,232,500.00 in
favor of the Guarantied Party (the "NOTE") in accordance with the terms of
the Second Amended Joint Plan of Reorganization of the Company (the "Plan")
dated November 13, 1998, as amended, and filed with the United States
Bankruptcy Court for the Southern District of New York (the "BANKRUPTCY
COURT"); and
WHEREAS, the Guarantor owns all of the shares of stock of the Company and
will derive indirect benefit from the Note;
WHEREAS, to induce the Guarantied Party to accept the Plan, the Guarantor
has agreed to guarantee to the Guarantied Party the payment and performance
of the terms and provisions of the Note;
NOW, THEREFORE, the Guarantor does agree with, and for the benefit of,
the Guarantied Party as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. Unless otherwise defined herein, all
capitalized terms shall have the meaning ascribed to them in the Note.
ARTICLE II
GUARANTEE
SECTION 2.1. GUARANTEE OF NOTE PAYMENTS. The Guarantor hereby
irrevocably, absolutely and unconditionally guarantees to the Guarantied
Party and its successors, endorsees, transferees and assigns the due and
punctual payment in full in cash of (i) the principal of, premium, if any,
and interest, if any, on, and any other amounts due under, the Note when and
as the same shall become due and payable (whether at stated maturity or by
required or optional prepayment or by acceleration or otherwise) and (ii) any
other sums or amounts which may become due under, or in connection with, the
terms and provisions of the Note or this Guarantee, without right of any
setoff or counterclaim. All such obligations described in this Section 2.1
are herein called the "PAYMENT OBLIGATIONS."
SECTION 2.2. PAYMENT OF ENFORCEMENT COSTS. The Guarantor also hereby
agrees to pay on demand to Holder as and when incurred all reasonable costs
and expenses of enforcing this Guarantee, including but not limited to court
costs and reasonable attorneys' fees and disbursements. The obligations under
this Section 2.2 are hereinafter referred to as the "ENFORCEMENT COST
OBLIGATIONS".
SECTION 2.3. NON-IMPAIRMENT OF GUARANTEE. The obligations, covenants,
agreements and duties of the Guarantor under this Guarantee shall in no way
be released, diminished, reduced, affected or impaired by reason of the
happening from time to time of any of the following events, any of which may
be done or occur without the necessity of any notice to or further consent of
the Guarantor (all of which are hereby expressly waived by the Guarantor):
(a) The release or waiver, by operation of law or otherwise, of the
performance or observance by, to the fullest extent permitted by law, the
Company or by any other party to the Note or any other guarantor, surety,
endorser, letter of credit bank or other obligor of any of the Payment
Obligations or any agreement, covenant, term or condition in the Note to be
performed or observed by such party;
(b) The extension of the time for the payment of all or any portion of
the Payment Obligations or the
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extension of time for the performance of any Payment Obligations or any other
obligation under the Note;
(c) The renewal, supplementation, modification, rearrangement or
amendment (whether material or otherwise) of any of the Note or any of the
obligations of the Company or any other party to the Note;
(d) Any failure, omission, delay, neglect, refusal or lack of diligence
on the part of Holder to enforce, assert or exercise any right, privilege,
power or remedy conferred on Holder in the Note or any action on the part of
Holder granting indulgence, adjustment, forbearance or extension of any kind;
(e) The release, surrender, exchange, subordination or loss of any
security under the Note or the release, modification, amendment, waiver or
failure or refusal to enforce any pledge, security device, letter of credit,
insurance agreement, bond or similar agreement or any guarantee, surety or
indemnity agreement whatsoever;
(f) The release, modification, waiver or failure to enforce any right,
benefit, privilege or interest under any contract or agreement of any kind
under which the rights of the Company have been collaterally or absolutely
transferred or assigned, or a security interest in which has been granted, to
Holder as direct or indirect security for payment of any of the Payment
Obligations or for performance of any obligations to Holder pursuant to the
Note;
(g) The death, legal incapacity, disability, voluntary or involuntary
liquidation, dissolution, sale of any collateral, marshaling of assets and
liabilities, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of
debt of, or other similar proceedings affecting, the Company, the Guarantor,
or their respective affiliates, any other surety for Company or any of the
assets of the Company or Guarantor;
(h) Any invalidity of, or defect or deficiency in, the Note or any
related papers, to the fullest extent permitted by law, including without
limitation the unenforceability of any or all of the provisions of any of the
Note or any related papers, or any failure to acquire, perfect or maintain
perfection of any lien on or security interest in any collateral securing
payment of the Payment
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Obligations, or any portion thereof, or performance of the Company's
obligations thereunder;
(i) The settlement or compromise of any obligation guaranteed hereby or
hereby incurred;
(j) The taking or accepting of any other security or guarantee for the
payment or performance of any of the Note, the Payment Obligations, the
Enforcement Cost Obligations, or any of the other obligations of the Company
under the Note;
(k) Any failure of Holder to notify Guarantor of any renewal, extension
or assignment of the Note or any part thereof, or the release of any
security, or of any other action taken or refrained from being taken by
Holder against the Company, or of any new agreement between Holder and the
Company, it being understood that Holders shall not be required to give
Guarantor any notice of any kind under any circumstances whatsoever with
respect to or in connection with the Note; or
(l) Any other event, action or circumstance that would, in absence of
this subparagraph (l), result in the release or discharge of the Guarantor
from the performance or observance of any obligation, covenant or agreement
contained in this Guarantee.
SECTION 2.4. WAIVERS BY GUARANTOR. The Guarantor hereby waives (a)
marshaling of assets and liabilities, any requirement that assets be sold in
any particular order, notice of acceptance of this Guarantee and of any
liability to which it applies or may apply, presentment, demand for payment,
protest, notice of nonpayment, notice of dishonor, notice of the taking of any
other action by Holder and all other notices and demands and (b) all
suretyship defenses and all defenses based upon the impairment of suretyship
status.
SECTION 2.5. GUARANTEE OF PAYMENT AND PERFORMANCE. This is an
absolute, present and continuing guarantee of payment and performance of the
Payment Obligations and not a guarantee of collection, and the Guarantor
waives any right to require that any action be brought against the Company or
that Holder be required to exhaust any of its rights, benefits or privileges
under the Note or any security given therefor; PROVIDED, HOWEVER, that
nothing contained herein shall be construed to prevent
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Holder from exercising and enforcing any right, benefit or privilege which
Holder may have under this Guarantee or the Note from time to time, and at
any time, it being agreed that the Guarantor's obligations hereunder are, and
shall be, absolute, independent and unconditional under any and all
circumstances. Should Holder seek to enforce the obligations of the Guarantor
by action in any court, the Guarantor waives any necessity, substantive or
procedural, that a judgment previously be rendered against the Company or
that the Company or any other person or entity be joined in such action or
that a separate action be brought against the Company or any other person or
entity. The obligations of the Guarantor hereunder are several from those of
the Company or any other person or entity, and are primary obligations
concerning which the Guarantor is the principal obligor. All waivers herein
contained shall be without prejudice to the right of Holder at its option to
proceed against the Company or any other person, whether by separate action
or by joinder. The Guarantor agrees that this Guarantee shall not be
discharged except by payment in full in cash of all Payment Obligations and
all Enforcement Cost Obligations.
In the event that the Company or any other person liable shall fail so
to pay any of the Payment Obligations or Enforcement Cost Obligations, the
Guarantor agrees to pay the same when due to Holder or its designees, without
demand, presentment, protest or notice of any kind, in lawful money of the
United States of America, at the place for payment specified in the Note.
Each default in payment of principal of, premium, if any, or interest, if
any, on any of the Payment Obligations or Enforcement Cost Obligations shall
give rise to a separate cause of action hereunder and separate suits may be
brought hereunder as each cause of action arises. The Guarantor hereby
agrees that the Note may make reference to this Guarantee.
The Guarantor hereby agrees to pay and to indemnify and save Holder
harmless from and against any damage, loss, cost or expense (including
reasonable fees and expenses of attorneys) which Holder may incur or be
subject to as a consequence, direct or indirect, of (i) any breach by
Guarantor or the Company of any warranty, covenant, term or condition in, or
the occurrence of any default under, this Guarantee, or the Note, together
with all expenses resulting from the compromise or defense of any claims or
liabilities arising as a result of any such breach or default, and (ii) any
legal action commenced to challenge
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the validity of this Guarantee, the Note, or any of the Payment Obligations
or Enforcement Cost Obligations.
SECTION 2.6. RELIANCE UPON GUARANTEE. All extensions of credit and
financial accommodations heretofore or hereafter made by Holder to the
Company under the Note shall be conclusively presumed to have been in
reliance upon the giving of this Guarantee.
SECTION 2.7. REINSTATEMENT. This Guarantee shall continue to be
effective, or shall be reinstated, if at any time payment, or any part
thereof, of any of the Payment Obligations or Enforcement Cost Obligations is
rescinded or must otherwise be returned by Holder for any reason whatsoever
(including, but not limited to, the bankruptcy, insolvency, dissolution,
liquidation or reorganization of the Company or any other person), all as
though such payment had not been received by Holder.
SECTION 2.8. LIMITS ON SUBROGATION. No payment by the Guarantor
pursuant to any provision of this Guarantee or other satisfaction of the
Guarantor's liability under this Guarantee shall entitle the Guarantor, by
subrogation or otherwise, to any right or remedy against the Company until
after the payment in full in cash of the Payment Obligations and the
Enforcement Cost Obligations.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Guarantor hereby represents and warrants as follows:
SECTION 3.1. The Guarantor is duly organized, validly existing and in
good standing under the laws of the State of Delaware, having full power and
authority to conduct its business in each jurisdiction where it presently
conducts any material part of its business.
SECTION 3.2. The execution, delivery and performance by the guarantor
of this Guarantee are within the powers of the Guarantor, have been duly
authorized by all necessary action, have received all necessary governmental
approvals, and do not contravene its organizational documents, or any law,
regulation or
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contractual restriction binding on the Guarantor.
SECTION 3.3. This Guarantee is the legal, valid and binding obligation
of the Guarantor and is enforceable against the Guarantor in accordance with
it terms.
SECTION 3.4. No event has occurred and no condition exists which, upon
or at the time of execution and delivery of the Guarantee would constitute an
Event of Default or would, with the giving of notice or lapse of time, or
both, constitute an Event of Default.
SECTION 3.5. The execution, delivery and performance by the Guarantor
of this Guarantee does not and will not require (a) any consent of any other
person or entity or (b) any consent, license, permit, authorization or other
approval of, any giving of notice to, any exemption by, any registration,
declaration or filing with, or any taking of any other action in respect of,
any court, arbitrator, administrative agency or other governmental authority,
the failure of which would materially and adversely affect the Guarantor's
performance of its obligations hereunder, other than the approval of the
Bankruptcy Court and other consents which have been obtained.
ARTICLE IV
COVENANTS
The Guarantor hereby covenants and agrees that it will comply with all
covenants which, under the terms of the Note, are applicable to it.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; TERMINATION OF
GUARANTEE. The representations, covenants and agreements herein set forth
shall continue and survive until termination of this Guarantee. Upon the
maturity date of the Note, or upon payment in full in cash of all Payment
Obligations and all Enforcement Cost
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Obligations, if later, this Guarantee shall terminate and be of no further
force and effect.
SECTION 5.2. SUCCESSOR AND ASSIGNS. This Guarantee shall inure to the
benefit of the Guarantied Party, any other Holder and their respective
successors, endorsees, transferees and assigns. The Guarantied Party and any
other Holder may assign to any party all or any part of, or any interest
(undivided or divided) in its rights and benefits herein, and to the extent
of that assignment such assignee shall have the same rights and benefits
against the Guarantor as it would have had if such assignee were the
Guarantied Party. This Guarantee and the provisions hereof are binding upon
successors of the Guarantor. Neither this Guarantee nor any obligation
hereunder shall be assigned by the Guarantor to any person or entity and any
attempted assignment shall be null and void.
SECTION 5.3. NOTICES. Except as otherwise provided herein, any notice,
demand, request, consent, approval, declaration, delivery or other
communication hereunder to be made pursuant to the provisions of this
Guarantee shall be sufficiently given or made if in writing and either
delivered in person with receipt acknowledged, or sent by registered or
certified mail, return receipt requested, postage prepaid, or by telecopy and
confirmed by telecopy answerback, addressed as follows:
If to the Guarantied Party:
BI-Equipment Lessor, LLC
c/o Oaktree Capital Management, LLC
000 Xxxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: General Counsel
Telecopy: (000) 000-0000
With a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00 Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
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If to Guarantor:
Barneys New York, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
Telecopy: (000) 000-0000
or at such other address as may be substituted by notice by Holder given as
herein provided. The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration, delivery or other communication
hereunder shall be deemed to have been duly given or served on the date on
which personally delivered, with receipt acknowledged, or telecopied and
confirmed by telecopy answerback, or three (3) business days after the same
shall have been deposited in the United States mail. Failure or delay in
delivering copies of any notice, demand, request, consent, approval,
declaration, delivery or other communication to the persons designated above
to receive copies shall in no way adversely affect the effectiveness of such
notice, demand, request, consent, approval, declaration, delivery or other
communication.
SECTION 5.4. EXPENSES. The Guarantor agrees to pay any and all
reasonable expenses (including reasonable legal fees and expenses) incurred by
Holder in connection with the enforcement of this Guarantee or the collection
of any sums due to Holder hereunder.
SECTION 5.5. PARTIAL INVALIDITY. Holder and the Guarantor intend
this Guarantee to comply with all applicable laws and to be a binding, legal
and enforceable contract which shall be liberally construed so as to carry
out their intent as expressed in this Guarantee. Without limiting the
generality of the immediately preceding sentence, if any provision of this
Guarantee is held to be illegal, invalid or unenforceable under present or
future laws effective during the term of this Guarantee, the legality,
validity and enforceability of the other provisions of this Guarantee shall
not be affected thereby.
SECTION 5.6. WAIVERS AND AMENDMENTS; CUMULATIVE REMEDIES. Holder
shall not be obligated to exercise any right, power or privilege under this
Guarantee, and no failure to exercise and no delay in exercising, on the part
of Holder, any such right, power or privilege under this
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Guarantee shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise or
the exercise of any other right, power or privilege. No notice to or demand
on the Guarantor shall be deemed to be a waiver of Holder's right to take
further action without notice or demand as provided herein. No waiver shall
be applicable except in the specific instance for which given or shall in any
way impair Holder's rights or the Guarantor's liability in any other respect
or at any other time, nor in any event shall any modification or waiver of
any provision of this Guarantee be effective unless in writing and signed on
behalf of Holder and, as to any modification, Guarantor. The rights and
remedies provided in this Guarantee are cumulative and are not exclusive of
any other right or remedy provided by law, in equity or under any other
agreement or instrument.
SECTION 5.7. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE WHOLLY PERFORMED IN SUCH STATE
WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.
SECTION 5.8. SUBMISSION TO JURISDICTION. The Guarantor hereby
irrevocably submits to the jurisdiction of any New York State or Federal
court sitting in New York, and the Guarantor hereby irrevocably agrees that
any action may be heard and determined in such New York State court or in
such Federal court. The Guarantor hereby irrevocably waives, to the fullest
extent it may effectively do so, the defense of an inconvenient forum to the
maintenance of such action in any jurisdiction. The Guarantor hereby
irrevocably agrees that the summons and complaint or any other process in any
action in any jurisdiction may be served by mailing in accordance with the
provision set forth in Section 5.3. The Guarantor may also be served in any
other manner permitted by law, in which event its time to respond shall be
the time provided by law.
SECTION 5.9. SUBORDINATION. The obligations of the Guarantor under
this Guarantee shall be subordinated to the prior payment in full of all
Senior Debt as and to the extent such Senior Debt is guaranteed by the
Guarantor, to the same extent as the payments of the principal of and
interest on the Note are subordinated as provided in Section 3 of the Note.
SECTION 5.10. JURY WAIVER. GUARANTOR AND, BY ITS
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ACCEPTANCE HEREOF, HOLDER, EACH IRREVOCABLY WAIVE ALL RIGHTS TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY
OBLIGATIONS UNDER THIS GUARANTEE.
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IN WITNESS WHEREOF, the Guarantor has executed this Guarantee as of
the day and year first above written.
BARNEYS NEW YORK, INC.
By: /s/ Xxxxxx Xxxxxxx
-------------------------------
Xxxxxx Xxxxxxx
Executive Vice President
and Chief Financial Officer
