SUBSIDIARY GUARANTY
GUARANTY, dated as of December 10, 1998 (as amended, modified or
supplemented from time to time, this "Guaranty"), made by each of the
undersigned guarantors (each, a "Guarantor" and, together with any other entity
that becomes a party hereto pursuant to Section 26 hereof, the "Guarantors").
Except as otherwise defined herein, terms used herein and defined in the Credit
Agreement (as defined below) shall be used herein as therein defined.
W I T N E S S E T H :
WHEREAS, Superior National Insurance Group, Inc. (the
"Borrower"), the financial institutions from time to time party thereto (the
"Banks"), and The Chase Manhattan Bank, as Administrative Agent (together with
any successor administrative agent, the "Administrative Agent"), have entered
into a Credit Agreement, dated as of December 10, 1998 (as amended, modified or
supplemented from time to time, the "Credit Agreement"), providing for the
making of Loans to the Borrower as contemplated therein (the Banks and the
Administrative Agent are herein called the "Bank Creditors");
WHEREAS, the Borrower may from time to time be party to one or
more (i) interest rate agreements, interest rate cap agreements, interest rate
collar agreements or other similar agreements or arrangements, (ii) foreign
exchange contracts, currency swap agreements or similar agreements or
arrangements designed to protect against the fluctuations in currency values
and/or (iii) other types of hedging agreements from time to time (each such
agreement or arrangement with an Other Creditor (as hereinafter defined), an
"Interest Rate Protection Agreement or Other Hedging Agreement") with a Bank or
an affiliate of a Bank (each such Bank or affiliate, even if the respective Bank
subsequently ceases to be a Bank under the Credit Agreement for any reason,
together with such Bank's or affiliate's successors and assigns, collectively,
the "Other Creditors," and together with the Bank Creditors, are herein called
the "Creditors");
WHEREAS, each Guarantor is a Subsidiary of the Borrower;
WHEREAS, it is a condition to the making of Loans to the Borrower
under the Credit Agreement that each Guarantor shall have executed and delivered
this Guaranty; and
WHEREAS, each Guarantor will obtain benefits from the incurrence
of Loans by the Borrower under the Credit Agreement and the entering into of
Interest Rate Protection Agreements or Other Hedging Agreements and,
accordingly, desires to execute this Guaranty in order to satisfy the conditions
described in the preceding paragraph and to induce the Banks to make Loans to
the Borrower and Other Creditors to enter into Interest Rate Protection
Agreements or Other Hedging Agreements with the Borrower;
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NOW, THEREFORE, in consideration of the foregoing and other
benefits accruing to each Guarantor, the receipt and sufficiency of which are
hereby acknowledged, each Guarantor hereby makes the following representations
and warranties to the Creditors and hereby covenants and agrees with each
Creditor as follows:
1. Each Guarantor, jointly and severally, irrevocably and
unconditionally guarantees: (i) to the Bank Creditors the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of (x) the principal of and interest on the Notes issued by, and the Loans made
to, the Borrower under the Credit Agreement and (y) all other obligations
(including obligations which, but for the automatic stay under Section 362(a) of
the Bankruptcy Code, would become due) and liabilities owing by the Borrower to
the Bank Creditors under the Credit Agreement (including, without limitation,
indemnities, Fees and interest thereon) and the other Credit Documents, whether
now existing or hereafter incurred under, arising out of or in connection with
the Credit Agreement or any such other credit Document and the due performance
and compliance with the terms of the Credit Documents by the Borrower (all such
principal, interest, liabilities and obligations under this clause (i), except
to the extent consisting of obligations or liabilities with respect to Interest
Rate Protection Agreements or Other Hedging Agreements, being herein
collectively called the "Credit Document Obligations"); and (ii) to each Other
Creditor the full and prompt payment when due (whether at the stated maturity,
by acceleration or otherwise) of all obligations (including obligations which,
but for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due) and liabilities owing by the Borrower under any Interest Rate
Protection Agreements or Other Hedging Agreements, whether now in existence or
hereafter arising, and the due performance and compliance by the Borrower with
all terms, conditions and agreements contained therein (all such obligations and
liabilities being herein collectively called the "Other Obligations", and
together with the Credit Document Obligations are herein collectively called the
"Guaranteed Obligations"), provided that the maximum amount payable by each
Guarantor hereunder shall at no time exceed the Maximum Amount (as hereinafter
defined) of such Guarantor. As used herein, "Maximum Amount" of any Guarantor
means an amount equal to 95% of the amount by which (i) the present fair
saleable value of such Guarantor's assets exceeds (ii) the amount reasonably
expected to come due in respect of all liabilities (including, without
limitation, contingent liabilities), other than liabilities (contingent or
otherwise) of such Guarantor hereunder, in each case determined on the Initial
Borrowing Date (or, in the case of a Guarantor that becomes a party hereto
pursuant to Section 26 hereof, on the date such Guarantor becomes a party
hereto) or (in either case) on the day any demand is made under this Guaranty,
whichever date results in a higher Maximum Amount. Subject to the proviso in
the second preceding sentence, each Guarantor understands, agrees and confirms
that the Creditors may enforce this Guaranty up to the full amount of the
Guaranteed Obligations against each Guarantor without proceeding against any
other Guarantor, the Borrower, against any security for the Guaranteed
Obligations, or under any other guaranty covering all or a portion of the
Guaranteed Obligations. All payments by each Guarantor under this Guaranty
shall be made on the same basis as payments by the Borrower are made under
Sections 3.03 and 3.04 of the Credit Agreement.
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2. Additionally, subject to the Maximum Amount limitation
contained in Section 1 above, each Guarantor, jointly and severally,
unconditionally and irrevocably, guarantees the payment of any and all
Guaranteed Obligations of the Borrower to the Creditors whether or not due or
payable by the Borrower upon the occurrence in respect of the Borrower of any of
the events specified in Section 8.05 of the Credit Agreement, and
unconditionally and irrevocably, jointly and severally, promises to pay such
Guaranteed Obligations to the Creditors, or order, on demand, in lawful money of
the United States.
3. The liability of each Guarantor hereunder is exclusive and
independent of any security for or other guaranty of the Guaranteed Obligations
of the Borrower whether executed by such Guarantor, any other Guarantor, any
other guarantor or by any other party, and the liability of each Guarantor
hereunder shall not be affected or impaired by (a) any direction as to
application of payment by the Borrower or by any other party, (b) any other
continuing or other guaranty, undertaking or maximum liability of a guarantor or
of any other party as to the Guaranteed Obligations of the Borrower, (c) any
payment on or in reduction of any such other guaranty or undertaking, (d) any
dissolution, termination or increase, decrease or change in personnel by the
Borrower or (e) any payment made to any Creditor on the Guaranteed Obligations
which any Creditor repays the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and each Guarantor waives any right to the deferral or modification
of its obligations hereunder by reason of any such proceeding.
4. The obligations of each Guarantor hereunder are independent
of the obligations of any other Guarantor, any other guarantor or the Borrower,
and a separate action or actions may be brought and prosecuted against each
Guarantor whether or not action is brought against any other Guarantor, any
other guarantor or the Borrower and whether or not any other Guarantor, any
other guarantor of the Borrower or the Borrower be joined in any such action or
actions. Each Guarantor waives, to the fullest extent permitted by law, the
benefit of any statute of limitations affecting its liability hereunder or the
enforcement thereof. Any payment by the Borrower or other circumstance which
operates to toll any statute of limitations as to the Borrower shall operate to
toll the statute of limitations as to each Guarantor.
5. Each Guarantor hereby waives (to the fullest extent permitted
by applicable law) notice of acceptance of this Guaranty and notice of any
liability to which it may apply, and waives promptness, diligence, presentment,
demand of payment, protest, notice of dishonor or nonpayment of any such
liabilities, suit or taking of other action by the Administrative Agent or any
other Creditor against, and any other notice to, any party liable thereon
(including such Guarantor or any other guarantor or the Borrower).
6. Any Creditor may (except as shall be required by applicable
statute and cannot be waived) at any time and from time to time without the
consent of, or notice to, any Guarantor, without incurring responsibility to
such Guarantor, without impairing or releasing the obligations of such Guarantor
hereunder, upon or without any terms or conditions and in whole or in part:
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(a) change the manner, place or terms of payment of, and/or
change or extend the time of payment of, renew, increase, accelerate or
alter, any of the Guaranteed Obligations, any security therefor, or any
liability incurred directly or indirectly in respect thereof, and the
guaranty herein made shall apply to the Guaranteed Obligations as so
changed, extended, renewed or altered;
(b) sell, exchange, release, surrender, realize upon or
otherwise deal with in any manner and in any order any property by
whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, the Guaranteed Obligations or any liabilities (including any
of those hereunder) incurred directly or indirectly in respect thereof
or hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and may
subordinate the payment of all or any part thereof to the payment of any
liability (whether due or not) of the Borrower to creditors of the
Borrower;
(e) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of the Borrower to the Creditors regardless
of what liabilities of the Borrower remain unpaid;
(f) consent to or waive any breach of, or any act, omission or
default under, any of the Interest Rate Protection Agreements or Other
Hedging Agreements, the Credit Documents or any of the instruments or
agreements referred to therein, or otherwise amend, modify or supplement
any of the Interest Rate Protection Agreements or Other Hedging
Agreements, the Credit Documents or any of such other instruments or
agreements; and/or
(g) act or fail to act in any manner referred to in this
Guaranty which may deprive such Guarantor of its right to subrogation
against the Borrower to recover full indemnity for any payments made
pursuant to this Guaranty.
7. No invalidity, irregularity or unenforceability of all or any
part of the Guaranteed Obligations or of any security therefor shall affect,
impair or be a defense to this Guaranty, and this Guaranty shall be primary,
absolute and unconditional notwithstanding the occurrence of any event or the
existence of any other circumstances which might constitute a legal or equitable
discharge of a surety or guarantor except payment in full of the Guaranteed
Obligations.
8. This Guaranty is a continuing one and all liabilities to
which it applies or may apply under the terms hereof shall be conclusively
presumed to have been created in reliance hereon. No failure or delay on the
part of any Creditor in exercising any right, power or privilege
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hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein expressly specified are cumulative
and not exclusive of any rights or remedies which any Creditor would
otherwise have. No notice to or demand on any Guarantor in any case shall
entitle such Guarantor to any other further notice or demand in similar or
other circumstances or constitute a waiver of the rights of any Creditor to
any other or further action in any circumstances without notice or demand.
It is not necessary for any Creditor to inquire into the capacity or powers
of the Borrower or any of its Subsidiaries or the officers, directors,
partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
9. Any indebtedness of the Borrower now or hereafter held by any
Guarantor is hereby subordinated to the indebtedness of the Borrower to the
Creditors; and such indebtedness of the Borrower to any Guarantor, if the
Administrative Agent, after an Event of Default has occurred and is continuing,
so requests, shall be collected, enforced and received by such Guarantor as
trustee for the Creditors and be paid over to the Creditors on account of the
indebtedness of the Borrower to the Creditors, but without affecting or
impairing in any manner the liability of such Guarantor under the other
provisions of this Guaranty. Prior to the transfer by any Guarantor of any note
or negotiable instrument evidencing any indebtedness of the Borrower to such
Guarantor, such Guarantor shall xxxx such note or negotiable instrument with a
legend that the same is subject to this subordination. Without limiting the
generality of the foregoing, each Guarantor hereby agrees with the Guaranteed
Creditors that it will not exercise any right of subrogation which it may at any
time otherwise have as a result of this Guaranty (whether contractual, under
Section 509 of the Bankruptcy Code or otherwise) until all Guaranteed
Obligations have been irrevocably paid in full in cash.
10. (a) Each Guarantor waives any right (except as shall be
required by applicable statute or law and cannot be waived) to require the
Creditors to: (i) proceed against the Borrower, any other Guarantor, any other
guarantor of the Borrower or any other party; (ii) proceed against or exhaust
any security held from the Borrower, any other Guarantor, any other guarantor of
the Borrower or any other party; or (iii) pursue any other remedy in the
Creditors' power whatsoever. Each Guarantor waives (to the fullest extent
permitted by applicable law) any defense based on or arising out of any defense
of the Borrower, any other Guarantor, any other guarantor of the Borrower or any
other party other than payment in full of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the disability of the
Borrower, any other Guarantor, any other guarantor of the Borrower or any other
party, or the unenforceability of the Guaranteed Obligations or any part thereof
from any cause, or the cessation from any cause of the liability of the Borrower
other than payment in full of the Guaranteed Obligations. The Creditors may, at
their election, foreclose on any security held by the Administrative Agent, the
Collateral Agent or the other Creditors by one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially reasonable
(to the extent such sale is permitted by applicable law), or exercise any other
right or remedy the Creditors may have against the Borrower or any other party,
or any security, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Guaranteed
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Obligations have been paid in full. Each Guarantor waives any defense
arising out of any such election by the Creditors, even though such election
operates to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of such Guarantor against the Borrower or any other
party or any security.
(b) Each Guarantor waives all presentments, demands for
performance, protests and notices, including, without limitation, notices of
nonperformance, notices of protest, notices of dishonor, notices of acceptance
of this Guaranty, and notices of the existence, creation or incurring of new or
additional indebtedness. Each Guarantor assumes all responsibility for being
and keeping itself informed of the Borrower's financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations and the nature, scope and extent of the risks which such
Guarantor assumes and incurs hereunder, and agrees that the Creditors shall have
no duty to advise any Guarantor of information known to them regarding such
circumstances or risks.
11. The Creditors agree that this Guaranty may be enforced only
by the action of the Administrative Agent or the Collateral Agent, in each case
acting upon the instructions of the Required Banks (or, after the date on which
all Credit Document Obligations have been paid in full, the holders of at least
a majority of the outstanding Other Obligations) and that no other Creditor
shall have any right individually to seek to enforce or to enforce this Guaranty
or to realize upon the security to be granted by the Security Documents, it
being understood and agreed that such rights and remedies may be exercised by
the Administrative Agent or the Collateral Agent or the holders of at least a
majority of the outstanding Other Obligations, as the case may be, for the
benefit of the Creditors in accordance with the terms of this Guaranty and the
Security Documents. The Creditors further agree that this Guaranty may not be
enforced against any director, officer, employee, partner or stockholder of any
Guarantor (except to the extent such stockholder is also a Guarantor hereunder).
12. In order to induce the Banks to make Loans pursuant to the
Credit Agreement, and in order to induce the Other Creditors to execute, deliver
and perform the Interest Rate Protection Agreements or Other Hedging Agreements,
each Guarantor represents, warrants and covenants that:
(a) Such Guarantor (i) is a duly organized and validly existing
corporation, limited liability company or partnership, as the case may
be, and is in good standing (to the extent such concept is relevant in
such jurisdiction) under the laws of the jurisdiction of its
organization, and has the corporate, limited liability company or
partnership, as the case may be, power and authority to own its property
and assets and to transact the business in which it is engaged and
presently proposes to engage and (ii) is duly qualified and is
authorized to do business and is in good standing in all jurisdictions
where it is required to be so qualified and where the failure to be so
qualified could reasonably be expected to have a Material Adverse
Effect.
(b) Such Guarantor has the corporate, limited liability company
or partnership, as the case may be, power and authority to execute,
deliver and carry out the terms and
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provisions of this Guaranty and each other Credit Document to which it
is a party and has taken all necessary corporate, limited liability
company or partnership, as the case may be, action to authorize the
execution, delivery and performance by it of each such Credit Document.
Such Guarantor has duly executed and delivered this Guaranty and each
other Credit Document to which it is a party and each such Credit
Document constitutes the legal, valid and binding obligation of such
Guarantor enforceable in accordance with its terms, except to the extent
that the enforceability hereof or thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by equitable principles
(regardless of whether enforcement is sought in equity or at law).
(c) Neither the execution, delivery or performance by such
Guarantor of this Guaranty or any other Credit Document to which it is a
party, nor compliance by it with the terms and provisions hereof or
thereof (i) will contravene any applicable provision of any law,
statute, rule or regulation, or any order, writ, injunction or decree of
any court or governmental instrumentality, (ii) will conflict or be
inconsistent with or result in any breach of, any of the terms,
covenants, conditions or provisions of, or constitute a default under,
or (other than pursuant to the Security Documents) result in the
creation or imposition of (or the obligation to create or impose) any
Lien upon any of the property or assets of such Guarantor or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of
trust, loan agreement, credit agreement or other material agreement or
other material instrument (other than any real property lease in effect
on the Initial Borrowing Date) to which such Guarantor or any of its
Subsidiaries is a party or by which it or any of its property or assets
is bound or to which it may be subject or (iii) will violate any
provision of the certificate of incorporation or by-laws (or equivalent
organizational documents) of such Guarantor or any of its Subsidiaries.
(d) No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with (other than in
connection with the Security Documents), or exemption by, any
governmental or public body or authority, or any subdivision thereof, is
required to authorize, or is required in connection with, (i) the
execution, delivery and performance of this Guaranty or any other Credit
Document to which such Guarantor is a party, or (ii) the legality,
validity, binding effect or enforceability of this Guaranty or any other
Credit Document to which such Guarantor is a party (other than (x) any
such consent, approval, license, authorization, validation, filing or
registration required in order for such Guarantor to be in compliance
with the Credit Agreement, which such Guarantor will make or obtain when
and as required and (y) filings and recordings required to perfect
security interests created under the Security Documents, which such
Guarantor will make promptly (but in no event more than 10 days) after
the time such Guarantor is required to do so).
(e) There are no actions, suits or proceedings pending or, to
the knowledge of such Guarantor, threatened with respect to such
Guarantor (i) that could reasonably be expected to have a Material
Adverse Effect or (ii) that could reasonably be expected to have a
material adverse effect on the rights or remedies of the Creditors or on
the ability
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of such Guarantor to perform its respective obligations to the Creditors
hereunder and under the other Credit Documents to which it is a party.
13. Each Guarantor covenants and agrees that on and after the
date hereof and until the termination of the Total Commitment and all Interest
Rate Protection Agreements or Other Hedging Agreements and when no Note or Loan
remains outstanding and all Guaranteed Obligations have been paid in full (other
than indemnities described in Section 11.13 of the Credit Agreement and
analogous provisions in the Pledge Agreement which are not then due and
payable), such Guarantor shall take, or will refrain from taking, as the case
may be, all actions that are necessary to be taken or not taken so that no
violation of any provision, covenant or agreement contained in Section 6 or 7 of
the Credit Agreement, and so that no Default or Event of Default, is caused by
the actions of such Guarantor or any of its Subsidiaries.
14. The Guarantors hereby jointly and severally agree to pay all
reasonable out-of-pocket costs and expenses of each Creditor in connection with
the enforcement of this Guaranty, and of the Administrative Agent in connection
with any amendment, waiver or consent relating hereto (including, without
limitation, the reasonable fees and disbursements of counsel (including in-house
counsel) employed by any of the Creditors or the Administrative Agent, as the
case may be).
15. This Guaranty shall be binding upon each Guarantor and its
successors and assigns and shall inure to the benefit of the Creditors and their
successors and assigns.
16. Neither this Guaranty nor any provision hereof may be
changed, waived, discharged or terminated except with the written consent of
each Guarantor directly affected thereby and either (x) the Required Banks (or
to the extent required by Section 11.12 of the Credit Agreement, with the
written consent of each Bank) at all times prior to the time on which all Credit
Document Obligations have been paid in full or (y) the holders of at least a
majority of the outstanding Other Obligations at all times after the time on
which all Credit Document Obligations have been paid in full; PROVIDED, that any
change, waiver, modification or variance affecting the rights and benefits of a
single Class (as defined below) of Creditors (and not all Creditors in a like or
similar manner) shall require the written consent of the Requisite Creditors (as
defined below) of such Class of Creditors (it being understood that the addition
or release of any Guarantor hereunder shall not constitute a change, waiver,
discharge or termination affecting any Guarantor other than the Guarantor so
added or released). For the purpose of this Guaranty the term "Class" shall
mean each class of Creditors, I.E., whether (x) the Bank Creditors as holders of
the Credit Document Obligations or (y) the Other Creditors as the holders of the
Other Obligations. For the purpose of this Guaranty, the term "Requisite
Creditors" of any Class shall mean each of (x) with respect to the Credit
Document Obligations, the Required Banks (or all the Banks if required by
Section 11.12 of the Credit Agreement) and (y) with respect to the Other
Obligations, the holders of at least a majority of all obligations outstanding
from time to time under the Interest Rate Protection Agreements or Other Hedging
Agreements.
17. Each Guarantor acknowledges that an executed (or conformed)
copy of each of the Credit Documents and Interest Rate Protection Agreements or
Other Hedging Agreements
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has been made available to its principal executive officers and such officers
are familiar with the contents thereof.
18. In addition to any rights now or hereafter granted under
applicable law (including, without limitation, Section 151 of the New York
Debtor and Creditor Law) and not by way of limitation of any such rights, upon
the occurrence and during the continuance of an Event of Default (such term to
mean and include any "Event of Default" as defined in the Credit Agreement or
any payment default under any Interest Rate Protection Agreement or Other
Hedging Agreement continuing after any applicable grace period), each Creditor
is hereby authorized at any time or from time to time, without notice to any
Guarantor or to any other Person, any such notice being expressly waived, to set
off and to appropriate and apply any and all deposits (general or special) and
any other indebtedness at any time held or owing by such Creditor to or for the
credit or the account of such Guarantor, against and on account of the
obligations and liabilities of such Guarantor to such Creditor under this
Guaranty, irrespective of whether or not such Creditor shall have made any
demand hereunder and although said obligations, liabilities, deposits or claims,
or any of them, shall be contingent or unmatured.
19. All notices, requests, demands or other communications
pursuant hereto shall be deemed to have been duly given or made when delivered
to the Person to which such notice, request, demand or other communication is
required or permitted to be given or made under this Guaranty, addressed to such
party at (i) in the case of any Bank Creditor, as provided in the Credit
Agreement, (ii) in the case of any Guarantor, at 00000 Xxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxxxx 00000, Attention: General Counsel, Telephone No.: (000) 000-0000,
Telecopier No.: (000) 000-0000 and (iii) in the case of any Other Creditor, at
such address as such Other Creditor shall have specified in writing to the
Guarantor; or in any case at such other address as any of the Persons listed
above may hereafter notify the others in writing.
20. If claim is ever made upon any Creditor for repayment or
recovery of any amount or amounts received in payment or on account of any of
the Guaranteed Obligations and any of the aforesaid payees repays all or part of
said amount by reason of (i) any judgment, decree or order of any court or
administrative body having jurisdiction over such payee or any of its property
or (ii) any settlement or compromise of any such claim effected by such payee
with any such claimant (including the Borrower), then and in such event each
Guarantor agrees that any such judgment, decree, order, settlement or compromise
shall be binding upon such Guarantor, notwithstanding any revocation hereof or
other instrument evidencing any liability of the Borrower, and such Guarantor
shall be and remain liable to the aforesaid payees hereunder for the amount so
repaid or recovered to the same extent as if such amount had never originally
been received by any such payee.
21. (a) THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE
CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Any legal action or
proceeding with respect to this Guaranty or any other Credit Document to which
such Guarantor is a party may be brought in the courts of the State of New York
or of the United States of America for the Southern District of New York,
Page 10
and, by execution and delivery of this Guaranty, each Guarantor hereby
irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. Each Guarantor
hereby further irrevocably waives any claim that any such courts lack
jurisdiction over such Guarantor, and agrees not to plead or claim, in any
legal action or proceeding with respect to this Guaranty or any other Credit
Document to which such Guarantor is a party brought in any of the aforesaid
courts, that any such court lacks jurisdiction over such Guarantor. Each
Guarantor further irrevocably consents to the service of process out of any
of the aforementioned courts in any such action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to each
Guarantor at its address set forth in Section 19, such service to become
effective 30 days after such mailing. Each Guarantor hereby irrevocably
waives any objection to such service of process and further irrevocably
waives and agrees not to plead or claim in any action or proceeding commenced
hereunder or under any other Credit Document to which such Guarantor is a
party that service of process was in any way invalid or ineffective. Nothing
herein shall affect the right of any of the Creditors to serve process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against each Guarantor in any other jurisdiction.
(b) Each Guarantor hereby irrevocably waives any objection which
it may now or hereafter have to the laying of venue of any of the aforesaid
actions or proceedings arising out of or in connection with this Guaranty or any
other Credit Document brought in the courts referred to in clause (a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that such action or proceeding brought in any such court has been brought
in an inconvenient forum.
22. In the event that all of the equity interests of one or more
Guarantors is sold or otherwise disposed of or liquidated in compliance with the
requirements of Section 7.02 of the Credit Agreement (or such sale or other
disposition or liquidation has been approved in writing by the Required Banks
(or all Banks if required by Section 11.12 of the Credit Agreement)) and the
proceeds of such sale, disposition or liquidation are applied in accordance with
the provisions of the Credit Agreement, to the extent applicable, such Guarantor
shall be released from this Guaranty and this Guaranty shall, as to each such
Guarantor or Guarantors, terminate, and have no further force or effect (it
being understood and agreed that the sale of one or more Persons that own,
directly or indirectly, all of the equity interests of any Guarantor shall be
deemed to be a sale of such Guarantor for the purposes of this Section 22).
23. This Guaranty may be executed in any number of counterparts
and by the different parties hereto on separate counterparts, each of which when
so executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument. A set of counterparts executed by all
the parties hereto shall be lodged with the Borrower and the Administrative
Agent.
24. EACH GUARANTOR AND EACH OF THE CREDITORS HEREBY IRREVOCABLY
WAIVES ALL RIGHTS TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS
Page 11
GUARANTY, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY.
25. All payments made by any Guarantor hereunder will be made
without setoff, counterclaim or other defense.
26. It is understood and agreed that any Subsidiary of the
Borrower that is required to execute a counterpart of this Guaranty after the
date hereof pursuant to Section 7.15 of the Credit Agreement shall automatically
become a Guarantor hereunder by executing a counterpart hereof and delivering
the same to the Administrative Agent.
* * *
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed and delivered as of the date first above written.
SUPERIOR PACIFIC INSURANCE GROUP,
INC., as a Pledgor
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Executive Vice President
& Chief Financial
Officer
BUSINESS INSURANCE GROUP, INC., as
a Pledgor
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Vice President
PACIFIC INSURANCE BROKERAGE, INC.
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Executive Vice President
& Chief Financial
Officer
INFONET MANAGEMENT SYSTEMS, INC.
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Executive Vice President
& Chief Financial
Officer
SN INSURANCE SERVICES, INC.
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Executive Vice President
& Chief Financial
Officer
SN INSURANCE ADMINISTRATORS, INC.
By: /s/ J. XXXXX XXXXXX
-------------------------------
Name: J. Xxxxx Xxxxxx
Title: Executive Vice President
& Chief Financial
Officer
THE CHASE MANHATTAN BANK, as
Administrative Agent
By: /s/ XXXXXXXX XXXXXXX, XX.
-------------------------------
Name: Xxxxxxxx Xxxxxxx, Xx.
Title: Vice President
