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EXHIBIT 10.6
GUARANTY
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GUARANTY, dated as of October 24, 1996, by PACIFIC DIRECT MARKETING CORP., a
California corporation, (the "Guarantor") in favor of (a) THE FIRST NATIONAL
BANK OF BOSTON, a national banking association, as agent (hereinafter, in such
capacity, the "Agent") for itself and the other lending institutions
(hereinafter, collectively, the "Banks") which are or may become parties to a
Revolving Credit and Term Loan Agreement dated as of October 24, 1996 (as
amended and in effect from time to time, the "Credit Agreement") among SalesLink
Corporation, a Massachusetts corporation (the "Borrower"), CMG Information
Services, Inc., a Delaware corporation (the "Parent"), the Guarantor, the Banks
and the Agent and (b) each of the Banks.
WHEREAS, the Borrower, the Parent and the Guarantor have entered into the Credit
Agreement with the Agent and the Banks pursuant to which the Banks and the
Agent, subject to the terms and conditions contained therein, is to make loans
or otherwise to extend to the Borrower and the Parent;
WHEREAS, the Borrower, the Parent and the Guarantor are members of a group of
related corporations, the success of either one of which is dependent in part on
the success of the other members of such group;
WHEREAS, the Guarantor expects to receive substantial direct and indirect
benefits from the extensions of credit to the Borrower and the Parent by the
Agent and the Banks pursuant to the Credit Agreement (which benefits are hereby
acknowledged);
WHEREAS, it is a condition precedent to the Bank's making any loans or otherwise
extending credit to the Borrower or the Parent under the Credit Agreement that
the Guarantor execute and deliver to the Agent and the Banks a guaranty
substantially in the form hereof; and
WHEREAS, the Guarantor wishes to guaranty the Borrower's and the Parent's joint
and several obligations to the Agent and the Banks under or in respect of the
Credit Agreement as provided herein;
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NOW, THEREFORE, the Guarantor hereby agrees with the Agent adn the Banks as
follows:
I. DEFINITIONS.
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The term "Obligations" and all other capitalized terms used herein without
definition shall have the respective meanings provided therefor in the Credit
Agreement.
II. GUARANTY OF PAYMENT AND PERFORMANCE.
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The Guarantor 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 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 (S)362(a) of the Federal Bankruptcy Code and the
operation of (S)(S)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
Borrower or the Parent or resort to any collateral security or other means of
obtaining payment. Should the Borrower or the Parent default in the payment or
performance of any of the Obligations, the obligations of the Guarantor
hereunder with respect to such Obligations in default shall become immediately
due and payable to the Agent and the Banks, without demand or notice of any
nature, all of which are expressly waived by the Guarantor. Payments by the
Guarantor hereunder may be required by the Agent or any Bank on any number of
occasions.
III. GUARANTOR'S AGREEMENT TO PAY ENFORCEMENT COSTS, ETC.
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The Guarantor further agrees, as the principal obligor and not as a guarantor
only, to pay to the Agent, on demand, all 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 (S)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
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under applicable law, then such interest shall be reduced to such maximum
permitted amount.
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IV. WAIVERS BY GUARANTOR; BANK'S FREEDOM TO ACT.
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The Guarantor 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. The Guarantor
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 either the Borrower or the Parent 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, the Guarantor agrees to the provisions of any
instrument evidencing, securing or otherwise executed in connection with any
Obligation and agrees that the obligations of the 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 Borrower, the Parent 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,
amendments or modifications of any of the terms or provisions of the Credit
Agreement, the Notes, 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 adequacy of
any rights which the 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 the
Guarantor or otherwise operate as a release or discharge of the Guarantor, all
of which may be done without notice to the Guarantor. To the fullest extent
permitted by law, the Guarantor 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 the Guarantor before or after the
Agent's or any 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.
V. UNENFORCEABILITY OF OBLIGATIONS AGAINST BORROWER OR PARENT.
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If for any reason either the Borrower or the Parent 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 either the Borrower or the Parent by
reason of the Borrower's or the Parent's insolvency, bankruptcy or
reorganization or by other operation of law or for any other reason, this
Guaranty shall nevertheless be binding on the Guarantor to the same extent as if
the Guarantor at all times had been the principal obligor 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
the Company, or for any other reason, all such amounts otherwise subject to
acceleration under the terms of the Credit Agreement, the Notes, 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
Guarantor.
VI. SUBROGATION; SUBORDINATION.
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A. WAIVER OF RIGHTS AGAINST BORROWER OR PARENT.
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Until the final payment and performance in full of all of the Obligations and
any and all other obligations of the Borrower, the Parent or the Guarantor to
the Agent or any Bank or any affiliate of the Agent or any Bank, the Guarantor
shall not exercise any rights against either the Borrower or the Parent arising
as a result of payment by the Guarantor hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and will not prove any
claim in competition with the Agent or any Bank or such affiliate in respect of
any payment hereunder in any bankruptcy, insolvency or reorganization case or
proceedings of any nature; the Guarantor will not claim any setoff, recoupment
or counterclaim against either the Borrower or the Parent in respect of any
liability of the Guarantor to the Borrower or the Parent; and the Guarantor
waives any benefit of and any right to participate in any collateral security
which may be held by the Agent or any Bank or any such affiliate.
B. SUBORDINATION.
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The payment of any amounts due with respect to any indebtedness of the Borrower
or the Parent now or hereafter owed to the Guarantor is hereby subordinated to
the prior payment
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in full of all of the Obligations and any and all other obligations of the
Borrower, the Parent or the Guarantor to the Agent or any Bank or any affiliate
of the Agent or any Bank. The Guarantor agrees that, after the occurrence of any
default in the payment or performance of any of the Obligations, the Guarantor
will not demand, xxx for or otherwise attempt to collect any such indebtedness
of the Borrower or the Parent to the Guarantor until all of the Obligations
shall have been paid in full. If, notwithstanding the foregoing sentence, the
Guarantor shall collect, enforce or receive any amounts in respect of such
indebtedness, such amounts shall be collected, enforced and received by the
Guarantor as trustee for the Agent for the benefito of the Agent and the Banks
and be paid over to the Agent for the benefit of the Agent and the Banks on
account of the Obligations without affecting in any manner the liability of the
Guarantor under the other provisions of this Guaranty.
C. PROVISIONS SUPPLEMENTAL.
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The provisions of this (S)6 shall be supplemental to and not in derogation of
any rights and remedies of the Agent or any Bank or any affiliate of the Agent
or any Bank under any separate subordination agreement which the Agent or such
Bank or such affiliate may at any time and from time to time enter into with the
Guarantor.
VII. SECURITY; SETOFF.
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The Guarantor grants to the Agent for the benefit of the Agent and the Banks, as
security for the full and punctual payment and performance of all of the
Guarantor's obligations hereunder, a continuing lien on and security interest in
all securities or other property belonging to the Guarantor now or hereafter
held by the Agent or any 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 any Bank to the Guarantor or subject to withdrawal by the Guarantor.
Regardless of the adequacy of any collateral security or other means of
obtaining payment of any of the Obligations, the Agent and any Bank is hereby
authorized at any time and from time to time, without notice to the Guarantor
(any such notice being expressly waived by the Guarantor) and to the fullest
extent permitted by law, to set off and apply such deposits and other sums
against the obligations of the Guarantor 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.
VIII. FURTHER ASSURANCES.
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The Guarantor agree that it will from time to time, at the request of the Agent,
provide to the Agent the Guarantor's most recent audited and unaudited balance
sheets and related statements of income and changes in financial condition
(prepared on a consolidated basis with the Guarantor's subsidiaries, if any) and
such other information relating to the business and affairs of the Guarantor as
the Agent or any Bank may reasonably request. The Guarantor also agrees to 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 Agent hereunder. The Guarantor
acknowledges and confirms that the Guarantor itself has established its own
adequate means of obtaining from the Borrower and the Parent on a continuing
basis all information desired by the Guarantor concerning the financial
condition of the Borrower and the Parent and that the Guarantor will look to the
Borrower and the Parent and not to the Bank in order for the Guarantor to keep
adequately informed of changes in the Company's financial condition.
IX. TERMINATION; REINSTATEMENT.
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This Guaranty shall remain in full force and effect until the Agent is given
written notice of the Guarantor's intention to discontinue this Guaranty,
notwithstanding any intermediate or temporary 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 on the signature page of the Credit Agreement. No such
notice shall affect any rights of the Agent or any Bank or of any affiliate of
the Agent or any Bank hereunder, including without limitation the rights set
forth in (S)(S)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, and
all checks, drafts, notes, instruments (negotiable or otherwise) and writings
made by or for the account of the Borrower or the Parent and drawn on the Agent
or any Bank or any of its agents purporting to be dated on or before the date of
receipt of such notice, although presented to and paid or accepted by the Agent
or any Bank after that date, shall form part of the Obligations. 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 the Borrower, the Parent,
or otherwise, all as though such payment had not been made or value received.
X. SUCCESSORS AND ASSIGNS.
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This Guaranty shall be binding upon the Guarantor, its successors and assigns,
and shall inure to the benefit of and be enforceable by the Agent, each Bank and
its successors, transferees
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and assigns. Without limiting the generality of the foregoing sentence, the
Agent or any Bank may assign or otherwise transfer the Credit Agreement, the
Notes, 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 the Agent or
such Bank herein.
XI. AMENDMENTS AND WAIVERS.
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No amendment or waiver of any provision of this Guaranty nor consent to any
departure by the Guarantor therefrom shall be effective unless the same shall be
in writing and signed by the Agent and each Bank. 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.
XII. NOTICES.
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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 Guarantor,
at the address set forth beneath its signature hereto, and if to the Agent or
any Bank, at the address for notices to the Agent and such Bank set forth on the
signature page of the Credit Agreement, or at such address as either party may
designate in writing to the other.
XIII GOVERNING LAW; CONSENT TO JURISDICTION.
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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. The Guarantor 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
Guarantor by mail at the address specified by reference in (S)12. The Guarantor
hereby waives any
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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 .
XIV WAIVER OF JURY TRIAL.
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THE GUARANTOR 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, the Guarantor 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. The Guarantor (a)
certifies that neither the Agent, any Bank nor any representative, agent or
attorney of the Agent or any Bank has represented, expressly or otherwise, that
the Agent or such Bank would not, in the event of litigation, seek to enforce
the foregoing waivers and (b) acknowledges that, in entering into the Credit
Agreement and the other Loan Documents to which the Agent or such Bank is a
party, the Agent and each Bank is relying upon, among other things, the waivers
and certifications contained in this (S)14.
XV. MISCELLANEOUS.
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This Guaranty constitutes the entire agreement of the Guarantor 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.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed and
delivered as of the date first above written.
PACIFIC DIRECT MARKETING CORP.
By: /s/ Its Duly Authorized Officer
Title:
Address:
Telex:
