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GUARANTY
GUARANTY, dated as of January 28, 1999, by and among THE XXXXXX GROUP,
INC., a Delaware corporation ("Group"), MDA CORP., an Oregon corporation
("MDA"), and TRANSPORT SERVICES UNLIMITED, INC., an Indiana corporation
("Transportation" and, collectively with Group and MDA, the "Guarantors" and,
each individually, a "Guarantor") in favor of (a) BANKBOSTON, N.A., a national
banking association, as agent (hereinafter, in such capacity, the "Agent") for
itself and the other banking institutions (hereinafter, collectively, the
"Banks") which are or may become parties to a Revolving Credit and Term Loan
Agreement dated as of January 28, 1999 (as amended and in effect from time to
time, the "Credit Agreement"), among Xxxxxx Drive Away, Inc., a Indiana
corporation ("Xxxxxx"), TDI, Inc., an Indiana corporation ("TDI"), and Xxxxxx
Finance, Inc., an Indiana corporation ("Finance" and, collectively with Xxxxxx
and TDI, the "Companies" and, each individually, a "Company"), Group, the Banks
and the Agent and (b) each of the Banks.
WHEREAS, the Companies and the Guarantors are members of a group of
related corporations, the success of any one of which is dependent in part on
the success of the other members of such group;
WHEREAS, each Guarantor expects to receive substantial direct and
indirect benefits from the extensions of credit to the Companies by the Banks
pursuant to the Credit Agreement (which benefits are hereby acknowledged);
WHEREAS, it is a condition precedent to the Banks' making any loans or
otherwise extending credit to the Companies under the Credit Agreement that each
of the Guarantors execute and deliver to the Agent, for the benefit of the Banks
and the Agent, a guaranty substantially in the form hereof; and
WHEREAS, each Guarantor wishes to guaranty the Companies' obligations
to the Banks and the Agent under or in respect of the Credit Agreement as
provided herein;
NOW, THEREFORE, each of the Guarantors hereby agrees with the Banks and
the Agent as follows:
1. Definitions.
The term "Obligations" and all other capitalized terms used herein
without definition shall have the respective meanings provided therefor in the
Credit Agreement.
2. Guaranty of Payment and Performance. Each of
the Guarantors hereby guarantees to the Banks and the Agent the full
and punctual payment when due (whether at stated maturity, by required
pre-payment, by acceleration or otherwise), as well
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as the performance, of all of the Obligations including all such which would
become due but for the operation of the automatic stay pursuant to ss.362(a) of
the Federal Bankruptcy Code and the operation of ss.ss.502(b) and 506(b) of the
Federal Bankruptcy Code. This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment and performance of all of
the Obligations and not of their collectibility only and is in no way
conditioned upon any requirement that the Agent or any Bank first attempt to
collect any of the Obligations from the Companies or resort to any collateral
security or other means of obtaining payment. Should the Companies default in
the payment or performance of any of the Obligations, the obligations of the
Guarantors hereunder with respect to such Obligations in default shall, upon
demand by the Agent, become immediately due and payable to the Agent, for the
benefit of the Banks and the Agent, without demand or notice of any nature, all
of which are expressly waived by each of the Guarantors. Payments by the
Guarantors hereunder may be required by the Agent on any number of occasions.
All payments by the Guarantors hereunder shall be made to the Agent, in the
manner and at the place of payment specified therefor in the Credit Agreement,
for the account of the Banks and the Agent.
3. Guarantors' Agreement to Pay Enforcement Costs, etc.
Each of the Guarantors further agrees, as the principal obligor and not
as a guarantor only, to pay to the Agent, on demand, all reasonable costs and
expenses (including court costs and legal expenses) incurred or expended by the
Agent or any Bank in connection with the Obligations, this Guaranty and the
enforcement thereof, together with interest on amounts recoverable under this
ss.3 from the time when such amounts become due until payment, whether before or
after judgment, at the rate of interest for overdue principal set forth in the
Credit Agreement, provided that if such interest exceeds the maximum amount
permitted to be paid under applicable law, then such interest shall be reduced
to such maximum permitted amount.
4. Waivers by Guarantors; Bank's Freedom to Act.
Each of the Guarantors agrees that the Obligations will be paid and
performed strictly in accordance with their respective terms, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Agent or any Bank with respect
thereto. Each of the Guarantors waives promptness, diligences, presentment,
demand, protest, notice of acceptance, notice of any Obligations incurred and
all other notices of any kind, all defenses which may be available by virtue of
any valuation, stay, moratorium law or other similar law now or hereafter in
effect, any right to require the marshalling of assets of the Companies or any
other entity or other person primarily or secondarily liable with respect to any
of the Obligations, and all suretyship defenses generally. Without limiting the
generality of the foregoing, each of the Guarantors agrees to the provisions of
any instrument evidencing, securing or otherwise executed in connection with any
Obligation and agrees that the obligations of such Guarantor hereunder shall not
be released or discharged, in whole or in part, or otherwise affected by (a) the
failure of the Agent or any Bank to assert any claim or demand or to enforce any
right or remedy against the Companies or any other entity or other person
primarily or secondarily liable with respect to any of the Obligations; (b) any
extensions, compromise, refinancing, consolidation or renewals of any
Obligation; (c) any change in the time, place or manner of payment of any of the
Obligations or any rescissions, waivers, compromise, refinancing, consolidation
or other amendments or modifications of any of the terms or provisions of the
Credit Agreement, the other Loan Documents or any other agreement evidencing,
securing or otherwise executed in connection with any of the Obligations, (d)
the addition, substitution or release of any entity or other person primarily or
secondarily liable for any Obligation; (e) the
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adequacy of any rights which the Agent or an Bank may have against any
collateral security or other means of obtaining repayment of any of the
Obligations; (f) the impairment of any collateral securing any of the
Obligations, including without limitation the failure to perfect or preserve any
rights which the Agent or any Bank might have in such collateral security or the
substitution, exchange, surrender, release, loss or destruction of any such
collateral security; or (g) any other act or omission which might in any manner
or to any extent vary the risk of such Guarantor or otherwise operate as a
release or discharge of such Guarantor, all of which may be done without notice
to such Guarantor. To the fullest extent permitted by law, each of the
Guarantors hereby expressly waives any and all rights or defenses arising by
reason of (i) any "one action" or "anti-deficiency" law which would otherwise
prevent the Agent or any Bank from bringing any action, including any claim for
a deficiency, or exercising any other right or remedy (including any right of
set-off), against such Guarantor before or after the Agent's or such Bank's
commencement or completion of any foreclosure action, whether judicially, by
exercise of power of sale or otherwise, or (ii) any other law which in any other
way would otherwise require any election of remedies by the Agent or any Bank.
5. Unenforceability of Obligations Against the Companies.
If for any reason any Company has no legal existence or is under no
legal obligation to discharge any of the Obligations, or if any of the
Obligations have become irrecoverable from any Company by reason of such
Company's insolvency, bankruptcy or reorganization or by other operation of law
or for any other reason, this Guaranty shall nevertheless be binding on the
Guarantors to the same extent as if the Guarantors at all times had been the
principal obligors on all such Obligations. In the event that acceleration of
the time for payment of any of the Obligations is stayed upon the insolvency,
bankruptcy or reorganization of any Company, or for any other reason, all such
amounts otherwise subject to acceleration under the terms of the Credit
Agreement, the other Loan Documents or any other agreement evidencing, securing
or otherwise executed in connection with any Obligation shall be immediately due
and payable by the Guarantors.
6. Subrogation; Subordination.
6.1. Waiver of Rights Against the Companies. Until
the final payment and performance in full of all of the
Obligations, the Guarantors shall not exercise and hereby
waive any rights against the Companies arising as a result of
payment by the Guarantors hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and
will not prove any claim in competition with the Agent or any
Bank in respect of any payment hereunder in any bankruptcy,
insolvency or reorganization case or proceedings of any
nature; the Guarantors will not claim any setoff, recoupment
or counterclaim against the Companies in respect of any
liability of the Guarantors to the Companies; and the
Guarantors waive any benefit of and any right to participate
in any collateral security which may be held by the Agent or
any Bank.
6.2. Subordination. The payment of any amounts due
with respect to any indebtedness of the Companies for money
borrowed or credit received now or hereafter owed to the
Guarantors is hereby subordinated to the prior payment in full
of all of the Obligations. Each of the Guarantors
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agrees that, after the occurrence and during the continuance
of any default in the payment or performance of any of the
Obligations, such Guarantor will not demand, xxx for or
otherwise attempt to collect any such indebtedness of the
Companies to such Guarantor until all of the Obligations shall
have been paid in full. If, notwithstanding the foregoing
sentence, any Guarantor shall collect, enforce or receive any
amounts in respect of such indebtedness while any Obligations
are still outstanding, such amounts shall be collected,
enforced and received by such Guarantor as trustee for the
Banks and the Agent and be paid over to the Agent, for the
benefit of the Banks and the Agent, on account of the
Obligations without affecting in any manner the liability of
the Guarantors under the other provisions of this Guaranty.
6.3. Provisions Supplemental. The provisions of this
ss.6 shall be supplemental to and not in derogation of any
rights and remedies of the Banks and the Agent under any
separate subordination agreement which the Agent may at any
time and from time to time enter into with any Guarantor for
the benefit of the Banks and the Agent.
7. Security; Setoff. Each of the Guarantors grants to each of the Agent
and the Banks, as security for the full and punctual payment and performance of
all of such Guarantor's obligations hereunder, a continuing lien on and security
interest in all securities or other property belonging to such Guarantor now or
hereafter held by the Agent or such Bank and in all deposits (general or
special, time or demand, provisional or final) and other sums credited by or due
from the Agent or such Bank to such Guarantor or subject to withdrawal by such
Guarantor. Regardless of the adequacy of any collateral security or other means
of obtaining payment of any of the Obligations, each of the Agent and the Banks
is hereby authorized at any time and from time to time, without notice to such
Guarantor (any such notice being expressly waived by such Guarantor) and to the
fullest extent permitted by law, to set off and apply such deposits and other
sums against the obligations of the Guarantors under this Guaranty, whether or
not the Agent or such Bank shall have made any demand under this Guaranty and
although such obligations may be contingent or unmatured.
8. Further Assurances. Each of the Guarantors agrees that it will from
time to time, at the request of the Agent, do all such things and execute all
such documents as the Agent may consider necessary or desirable to give full
effect to this Guaranty and to perfect and preserve the rights and powers of the
Banks and the Agent hereunder. Each of the Guarantors acknowledges and confirms
that such Guarantor itself has established its own adequate means of obtaining
from the Companies on a continuing basis all information desired by such
Guarantor concerning the financial condition of the Companies and that such
Guarantor will look to the Companies and not to the Agent or any Bank in order
for such Guarantor to keep adequately informed of changes in the Companies'
financial condition.
9. Termination; Reinstatement. This Guaranty shall remain in full force
and effect until the Agent is given written notice of the Guarantors' intention
to discontinue this Guaranty, notwithstanding any intermediate or temporary
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payment or settlement of the whole or any part of the Obligations. No such
notice shall be effective unless received and acknowledged by an officer of the
Agent at the address of the Agent for notices set forth in ss.21 of the Credit
Agreement. No such notice shall affect any rights of the Agent or any Bank
hereunder, including without limitation the rights set forth in ss.ss.4 and 6,
with respect to any Obligations incurred or accrued prior to the receipt of such
notice or any Obligations incurred or accrued pursuant to any contract or
commitment in existence prior to such receipt. This Guaranty shall continue to
be effective or be reinstated, notwithstanding any such notice, if at any time
any payment made or value received with respect to any Obligation is rescinded
or must otherwise be returned by the Agent or any Bank upon the insolvency,
bankruptcy or reorganization of any Company, or otherwise, all as though such
payment had not been made or value received.
10. Successors and Assigns. This Guaranty shall be binding upon each of
the Guarantors, its successors and assigns, and shall inure to the benefit of
the Agent and the Banks and their respective successors, transferees and
assigns. Without limiting the generality of the foregoing sentence, each Bank
may assign or otherwise transfer the Credit Agreement, the other Loan Documents
or any other agreement or note held by it evidencing, securing or otherwise
executed in connection with the Obligations, or sell participations in any
interest therein, to any other entity or other person, and such other entity or
other person shall thereupon become vested, to the extent set forth in the
agreement evidencing such assignment, transfer or participation, with all the
rights in respect thereof granted to such Bank herein, all in accordance with
ss.20 of the Credit Agreement. The Guarantors may not assign any of their
obligations hereunder.
11. Amendments and Waivers. No amendment or waiver of any provision of
this Guaranty nor consent to any departure by any Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Agent with the
consent of the Majority Banks. No failure on the part of the Agent or any Bank
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.
12. Notices. All notices and other communications called for hereunder
shall be made in writing and, unless otherwise specifically provided herein,
shall be deemed to have been duly made or given when delivered by hand or mailed
first class, postage prepaid, or, in the case of telegraphic or telexed notice,
when transmitted, answer back received, addressed as follows: if to the
Guarantors, at the address set forth beneath its signature hereto, and if to the
Agent, at the address for notices to the Agent set forth in ss.21 of the Credit
Agreement, or at such address as either party may designate in writing to the
other.
13. Governing Law; Consent to Jurisdiction. THIS GUARANTY IS INTENDED
TO TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. Each of the
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Guarantors agrees that any suit for the enforcement of this Guaranty may be
brought in the courts of the Commonwealth of Massachusetts or any federal court
sitting therein and consents to the nonexclusive jurisdiction of such court and
to service of process in any such suit being made upon the Guarantors by mail at
the address specified by reference in ss.12. Each of the Guarantors hereby
waives any objection that it may now or hereafter have to the venue of any such
suit or any such court or that such suit was brought in an inconvenient court.
14. Waiver of Jury Trial. EACH OF THE GUARANTORS HEREBY WAIVES ITS
RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY
DISPUTE IN CONNECTION WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR
THE PERFORMANCE OF ANY OF SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by
law, each of the Guarantors hereby waives any right which it may have to claim
or recover in any litigation referred to in the preceding sentence any special,
exemplary, punitive or consequential damages or any damages other than, or in
addition to, actual damages. Each of the Guarantors (i) certifies that neither
the Agent or any Bank nor any representative, agent or attorney of the Agent or
any Bank has represented, expressly or otherwise, that the Agent or any Bank
would not, in the event of litigation, seek to enforce the foregoing waivers and
(ii) acknowledges that, in entering into the Credit Agreement and the other Loan
Documents to which the Agent or any Bank is a party, the Agent and the Banks are
relying upon, among other things, the waivers and certifications contained in
this ss.14.
15. Miscellaneous. This Guaranty constitutes the entire agreement of
the Guarantors with respect to the matters set forth herein. The rights and
remedies herein provided are cumulative and not exclusive of any remedies
provided by law or any other agreement, and this Guaranty shall be in addition
to any other guaranty of or collateral security for any of the Obligations. The
invalidity or unenforceability of any one or more sections of this Guaranty
shall not affect the validity or enforceability of its remaining provisions.
Captions are for the ease of reference only and shall not affect the meaning of
the relevant provisions. The meanings of all defined terms used in this Guaranty
shall be equally applicable to the singular and plural forms of the terms
defined.
IN WITNESS WHEREOF, each of the Guarantors has caused this Guaranty to
be executed and delivered as of the date first above written.
THE XXXXXX GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
Name Xxxxxx X. Xxxxxxxx
Title: CFO
Address:
0000 Xxx X.X. Xxxxx 00 Xxxx
Xxxxxxx, Xxxxxxx 00000
Facsimile:
MDA CORP.
By: /s/ Xxxx X. Xxxxxxxx
Name Xxxx X. Xxxxxxxx
Title: President
Address:
0000 X.X. Xxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Facsimile:
TRANSPORT SERVICES UNLIMITED, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
Name Xxxxxx X. Xxxxxxxx
Title: CFO
Address:
0000 Xxx X.X. Xxxxx 00 Xxxx
Xxxxxxx, Xxxxxxx 00000
Facsimile:
