EX-99.9
UNCONDITIONAL REIMBURSEMENT AND INDEMNIFICATION AGREEMENT
March ___, 2002
Xxxxxx Tree Construction, Inc. (which
may become known as Nutritionary, Inc.)
0000 Xxxxxxxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
(Individually and collectively, "Nutritionary")
American Health and Diet Centers, Inc.
000 Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
(Individually and collectively, "AHDC" and
together with Nutritionary, "Obligor")
Xxxxx Xxxxxxx
0 Xxxxxxxxx Xxxxx
Xxxx Xxxxxxxx, Xxx Xxxxxx 00000
(Hereinafter referred to as "XXXXXXX")
To induce XXXXXXX to continue his guaranty (the "HUBCO Agreement") of certain
debt of AHDC to Xxxxxx United Bank for a limited period of time pursuant to the
terms of the Stock Purchase Agreement (as hereinafter defined), Obligor hereby
absolutely, irrevocably and unconditionally guarantees to XXXXXXX and his
successors, assigns and affiliates the timely payment and performance of all
liabilities and obligations of AHDC to Xxxxxx United Bank, and Obligor hereby
agrees to indemnify and hold XXXXXXX harmless from and against any and all
liability under the HUBCO Agreement, and agrees that in the event, for any
reason, XXXXXXX is required to make any payments to Xxxxxx United Bank under the
HUBCO Agreement, Obligor shall immediately reimburse XXXXXXX for such payments,
together with any and all costs and expenses incurred in connection with such
payments (collectively, the "Guaranteed Obligations"). This Unconditional
Reimbursement and Indemnification Agreement (the "Agreement") is being delivered
pursuant to that certain Stock Purchase Agreement dated as of March __, 2002
among Nutritionary, XXXXXXX and Xxxxxx Xxxxx (as the same may be amended from
time to time, the "Stock Purchase Agreement"), the terms of which are
incorporated herein. Terms used but not otherwise defined herein shall have the
meanings ascribed to such terms in the Stock Purchase Agreement. Notwithstanding
anything in this Agreement to the contrary, in no event shall AHDC be relieved
of its primary and direct responsibility for the payment of any and all
indebtedness owning to Xxxxxx United Bank.
Obligor further covenants and agrees:
GUARANTOR'S LIABILITY. This Agreement is a continuing and unconditional guaranty
of payment and performance and not of collection. The parties to this Agreement
are jointly and severally obligated hereunder. This Agreement does not impose
any obligation on XXXXXXX to extend or continue to extend credit or otherwise
deal with the Obligor at any subsequent time. This Agreement shall continue to
be effective or be reinstated, as the case may be, if at any time any payment of
the Guaranteed Obligations is rescinded, avoided or for any other reason must be
returned by XXXXXXX, and the returned payment shall remain payable as part of
the Guaranteed Obligations, all as though such payment had not been made. Except
to the extent the provisions of this Agreement give XXXXXXX additional rights,
this Agreement shall not be deemed to supersede or replace any other guaranties
given to XXXXXXX by Obligor or any other obligations of Obligor to XXXXXXX; and
the obligations guaranteed hereby shall be in addition to any other obligations
guaranteed by Obligor pursuant to any other agreement of guaranty given to
XXXXXXX and other guaranties of the Guaranteed Obligations and/or any other
obligations of Obligor to XXXXXXX.
NO MODIFICATIONS. Obligor agrees that in no event will any modifications occur
with respect to the debt owing from AHDC to Xxxxxx United Bank.
WAIVERS AND ACKNOWLEDGMENTS. Obligor waives and releases the following rights,
demands, and defenses Obligor may have with respect to XXXXXXX and collection of
the Guaranteed Obligations: (a) promptness and diligence in collection of any of
the Guaranteed Obligations from any person liable thereon, and in foreclosure of
any security interest and sale of any property serving as collateral for the
Guaranteed Obligations; (b) any law or statute that requires that XXXXXXX make
demand upon, assert claims against, or collect from any persons or entities,
foreclose any security interest, sell collateral, exhaust any remedies, or take
any other action against any persons or entities prior to making demand upon,
collecting from or taking action against Obligor with respect to the Guaranteed
Obligations, including any such rights Obligor might otherwise have had under
any applicable law; (c) any law or statute that requires that any person be
joined in, notified of or made part of any action against Obligor; (d) that
XXXXXXX preserve, insure or perfect any security interest in collateral or sell
or dispose of collateral in a particular manner or at a particular time,
provided that XXXXXXX'x obligation to dispose of Collateral in a commercially
reasonable manner is not waived hereby; (e) notice of extensions, modifications,
renewals, or novations of the Guaranteed Obligations, of any new transactions or
other relationships between XXXXXXX, Obligor and/or any guarantor, and of
changes in the financial condition of, ownership of, or business structure of
Obligor or any other guarantor; (f) presentment, protest, notice of dishonor,
notice of default, demand for payment, notice of intention to accelerate
maturity, notice of acceleration of maturity, notice of sale, and all other
notices of any kind whatsoever; (g) the right to assert against XXXXXXX any
defense (legal or equitable), set-off, counterclaim, or claim that Obligor may
have at any time against any party liable to XXXXXXX; (h) all defenses relating
to invalidity, insufficiency, unenforceability, enforcement, release or
impairment of XXXXXXX'x xxxx on any collateral, or the Transaction Documents, or
of any other guaranties held by XXXXXXX; (i) any claim or defense that
acceleration of maturity of the Guaranteed Obligations is stayed against Obligor
because of the stay of assertion or of acceleration of claims against any other
person or entity for any reason including the bankruptcy or insolvency of that
person or entity; and (j) the benefit of any exemption claimed by Obligor.
Obligor acknowledges and represents that Obligor has relied upon Obligor's own
due diligence in making an independent appraisal of AHDC, AHDC's business
affairs and financial condition, and any collateral; and Obligor will continue
to be responsible for making an independent appraisal of such matters.
FINANCIAL CONDITION. Obligor warrants, represents and covenants to XXXXXXX that
on the date hereof: (a) the fair saleable value of Obligor's assets exceeds its
liabilities, Obligor is meeting its current liabilities as they mature, and
Obligor is and shall remain solvent; (b) all financial statements of Obligor
furnished to XXXXXXX are correct and accurately reflect the financial condition
of Obligor as of the respective dates thereof; (c) since the date of such
financial statements, there has not occurred a material adverse change in the
financial condition of Obligor; and (d) there are not now pending any court or
administrative proceedings or undischarged judgments against Obligor, no federal
or state tax liens have been filed or threatened against Obligor, and Obligor is
not in default or claimed default under any agreement.
APPLICATION OF PAYMENTS. Monies received from any source by XXXXXXX for
application toward payment of the Guaranteed Obligations may be applied to such
Guaranteed Obligations in any manner or order deemed appropriate by XXXXXXX.
DEFAULT. If any of the following events occur, an event of default ("Event of
Default") under this Agreement shall exist: (a) failure of timely payment or
performance of the Guaranteed Obligations or a default under any Transaction
Document; (b) a breach of any agreement or representation contained or referred
to in the Agreement, or any of the Transaction Documents, or contained in any
other contract or agreement of Obligor with XXXXXXX or his affiliates, whether
now existing or hereafter arising; (c) at XXXXXXX'x option, any default in
payment or performance of any obligation under any of the Transaction Documents
or any other loans, contracts or agreements of Obligor, any Subsidiary or
Affiliate of Obligor, any general partner of or the holder(s) of the majority
ownership interests of Obligor with XXXXXXX or his
affiliates and/or any default under the guaranties of Obligor in favor of Xxxxxx
Xxxxx and/or any other documents executed and/or delivered in connection
therewith ("Affiliate" shall have the meaning as defined in 11 U.S.C. ss. 101,
except that the term "Obligor" shall be substituted for the term "Debtor"
therein; "Subsidiary" shall mean any business in which Obligor holds, directly
or indirectly, a controlling interest); (d) the death of, appointment of a
guardian for, dissolution of, termination of existence of, loss of good standing
status by, appointment of a receiver for, assignment for the benefit of
creditors of, or the commencement of any insolvency or bankruptcy proceeding by
or against Obligor, its Subsidiaries or Affiliates, if any, or any general
partner of or the holder(s) of the majority ownership interests of Obligor; (e)
without prior written consent of XXXXXXX, (i) a material alteration in the kind
or type of Obligor's business or that of Obligor's Subsidiaries or Affiliates,
if any; (ii) the sale of substantially all of the business or assets of Obligor,
any of Obligor's Subsidiaries or Affiliates or any guarantor, or a material
portion (10% or more) of such business or assets if such a sale is outside the
ordinary course of business of Obligor, or any of Obligor's Subsidiaries or
Affiliates or any guarantor; (iii) any transfer of any of the outstanding stock
or voting power of AHDC or any transfer of more than 50% of the outstanding
stock or voting power of Nutritionary, or any other Affiliate or Subsidiary
(other than AHDC) in a single transaction or a series of transactions; (iv) the
acquisition of substantially all of the business or assets or more than 50% of
the outstanding stock or voting power of any other entity; or (v) should any of
Obligor or any of Obligor's Subsidiaries or Affiliates or any guarantor enter
into any merger or consolidation; (f) any representation or warranty given by
Obligor in this Agreement, the Transaction Documents or any documents executed
or provided in connection therewith or otherwise furnished by Obligor proves
materially false or, if of a continuing nature becomes materially false; and/or
(g) a failure to comply with any of the terms of this Guaranty or any other
Transaction Document.
If an Event of Default occurs, the Guaranteed Obligations shall be due
immediately and payable without notice, and, XXXXXXX may exercise any rights and
remedies as provided in this Agreement and other Transaction Documents, or as
provided at law or equity. Obligor shall pay interest on the Guaranteed
Obligations from such Event of Default at the highest rate of interest charged
on any of the Guaranteed Obligations.
ATTORNEYS' FEES AND OTHER COSTS OF COLLECTION. Obligor shall pay all of
XXXXXXX'X reasonable expenses incurred to enforce or collect any of the
Guaranteed Obligations, including, without limitation, reasonable arbitration,
paralegals', attorneys' and experts' fees and expenses, whether incurred without
the commencement of a suit, in any suit, arbitration, or administrative
proceeding, or in any appellate or bankruptcy proceeding.
SUBORDINATION OF OTHER DEBTS. Obligor agrees: (a) to subordinate the obligations
now or hereafter owed by either Obligor to the other ("Subordinated Debt") to
any and all obligations of AHDC and/or Nutritionary to XXXXXXX now or hereafter
existing while this Agreement is in effect; (b) Obligor will either place a
legend indicating such subordination on every note, ledger page or other
document evidencing any part of the Subordinated Debt or deliver such documents
to XXXXXXX; and (c) except as permitted by this paragraph, Obligor will not
request or accept payment of or any security for any part of the Subordinated
Debt, and any proceeds of the Subordinated Debt paid to Obligor, through error
or otherwise, shall immediately be forwarded to XXXXXXX by Obligor, properly
endorsed to the order of XXXXXXX, to apply to the Guaranteed Obligations.
MISCELLANEOUS. ASSIGNMENT. This Agreement and other Transaction Documents shall
inure to the benefit of and be binding upon the parties and their respective
heirs, legal representatives, successors and assigns. XXXXXXX'x interests in and
rights under this Agreement and other Transaction Documents are freely
assignable, in whole or in part, by XXXXXXX. Obligor shall not assign its rights
and interest hereunder without the prior written consent of XXXXXXX, and any
attempt by Obligor to assign without XXXXXXX'x prior written consent is null and
void. Any assignment shall not release Obligor from the Guaranteed Obligations.
APPLICABLE LAW; CONFLICT BETWEEN DOCUMENTS. This Agreement shall be governed by
and construed under the laws of the state of New Jersey without regard to that
state's conflict of laws principles. JURISDICTION. Obligor irrevocably agrees to
non-exclusive personal jurisdiction
in the state of New Jersey. SEVERABILITY. If any provision of this Agreement or
of the other Transaction Documents shall be prohibited or invalid under
applicable law, such provision shall be ineffective but only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement or other Transaction
Documents. NOTICES. Any notices to Obligor shall be sufficiently given if in
writing and mailed or delivered to Obligor's address shown above or such other
address as provided hereunder, and to XXXXXXX, if in writing and mailed or
delivered to XXXXXXX'x office address shown above or such other address as
XXXXXXX may specify in writing from time to time. In the event that Obligor
changes Obligor's address at any time prior to the date the Guaranteed
Obligations are paid in full, Obligor agrees to promptly give written notice of
said change of address to XXXXXXX by registered or certified mail, return
receipt requested, all charges prepaid. PLURAL; CAPTIONS. All references in the
Transaction Documents to borrower, guarantor, person, document or other nouns of
reference mean both the singular and plural form, as the case may be, and the
term "person" shall mean any individual person or entity. The captions contained
in the Transaction Documents are inserted for convenience only and shall not
affect the meaning or interpretation of the Transaction Documents. AMENDMENTS,
WAIVERS AND REMEDIES. No waivers, amendments or modifications of this Agreement
and other Transaction Documents shall be valid unless in writing and signed by
XXXXXXX. No waiver by XXXXXXX of any Event of Default shall operate as a waiver
of any other Event of Default or the same Event of Default on a future occasion.
Neither the failure nor any delay on the part of XXXXXXX in exercising any
right, power, or privilege granted pursuant to this Agreement and other
Transaction Documents shall operate as a waiver thereof, nor shall a single or
partial exercise thereof preclude any other or further exercise or the exercise
of any other right, power or privilege. All remedies available to XXXXXXX with
respect to this Agreement and other Transaction Documents and remedies available
at law or in equity shall be cumulative and may be pursued concurrently or
successively. TRANSACTION DOCUMENTS. The term "Transaction Documents" refers to
the $1,500,000 note dated of even date herewith given by Nutritionary in favor
of XXXXXXX, the guaranty of dated of even date herewith given by AHDC in favor
of XXXXXXX, the security agreement(s) dated of even date herewith given by
Nutritionary and AHDC to XXXXXXX, the pledge agreement dated of even date
herewith given by Nutritionary to XXXXXXX, the Stock Purchase Agreement, the
reimbursement and indemnification agreement dated of even date herewith given by
Obligor in favor of XXXXXXX, and all documents executed in connection with or
related to such documents or the Guaranteed Obligations and may include, without
limitation, other guaranty agreements, security agreements, instruments,
financing statements, mortgages, deeds of trust, deeds to secure debt, letters
of credit and any amendments or supplements (excluding swap agreements as
defined in 11 U.S. Code ss. 101).
IN WITNESS WHEREOF, Obligor, on the day and year first written above, has caused
this Unconditional Reimbursement and Indemnification Agreement to be executed
under seal.
XXXXXX TREE CONSTRUCTION, INC.
Taxpayer Identification Number: _____________
By: ____________________________________(SEAL)
AMERICAN HEALTH AND DIET CENTERS, INC.
Taxpayer Identification Number: _____________
By: ____________________________________(SEAL)
