SUBSIDIARY GUARANTY
EXHIBIT 99.4
GUARANTY, dated as of April 25, 2006 by Aroma Naturals, Inc., a Delaware corporation (the
“Guarantor”) in favor of (i) Citizens Bank of Massachusetts, as agent (hereinafter, in such
capacity, the “Administrative Agent”) for itself and the other banking institutions (hereinafter,
collectively, the “Lenders”) which are or may become parties to that certain Revolving Credit
Agreement dated as of May 19, 2004 (as amended and in effect from time to time, the “Credit
Agreement”), among The Yankee Candle Company, Inc., a Massachusetts corporation (the “Borrower”),
the Lenders and the Administrative Agent and (ii) each of the Lenders.
WHEREAS, the Borrower owns, directly or indirectly, 100% of the issued and outstanding stock
of, or other equity interests in, the Guarantor;
WHEREAS, the Guarantor expects to receive substantial direct and indirect benefits from the
extensions of credit to the Borrower by the Lenders pursuant to the Credit Agreement (which
benefits are hereby acknowledged);
WHEREAS, it is a condition precedent to the Lenders’ making any loans or otherwise extending
credit to the Borrower under the Credit Agreement that the Guarantor execute and deliver to the
Administrative Agent, for the benefit of the Lenders and the Administrative Agent, a guaranty
substantially in the form hereof; and
WHEREAS, the Guarantor wishes to guaranty the Borrower’s obligations to the Lenders and the
Administrative Agent under or in respect of the Credit Agreement as provided herein;
NOW, THEREFORE, the Guarantor hereby agrees with the Lenders and the Administrative 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. The Guarantor hereby guarantees to the
Lenders and the Administrative 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 §362(a) of the Federal Bankruptcy Code and the operation of §§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 Administrative
Agent or any Lender first attempt to collect any of the Obligations from the Borrower or resort to
any collateral security (if any) or other means of obtaining payment. Should the Borrower 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, upon demand by the Administrative Agent, become
immediately due and payable to the Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, 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 Administrative
Agent on any number of occasions. All payments by the Guarantor hereunder shall be
made to the
Administrative Agent, in the manner and at the place of payment specified therefor in the Credit
Agreement, for the account of the Lenders and the Administrative Agent.
3. Guarantor’s Agreement to Pay Enforcement Costs, etc. The Guarantor further
agrees, as the principal obligor and not as a guarantor only, to pay to the Administrative Agent,
on demand, all costs and expenses (including court costs and legal expenses) incurred or expended
by the Administrative Agent or any Lender in connection with the Obligations, this Guaranty and the
enforcement thereof, together with interest on amounts recoverable under this §3 from the time when
such amounts become due until payment, whether before or after judgment, at the Default Rate set
forth in §5.10 of 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 Guarantor; Lender’s Freedom to Act. 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 Administrative Agent or any Lender 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 the Borrower 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 (i) the failure of the Administrative
Agent or any Lender to assert any claim or demand or to enforce any right or remedy against the
Borrower or any other entity or other person primarily or secondarily liable with respect to any of
the Obligations; (ii) any extensions, compromise, refinancing, consolidation or renewals of any
Obligation; (iii) 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 Notes, the other Loan
Documents or any other agreement evidencing, securing or otherwise executed in connection with any
of the Obligations, (iv) the addition, substitution or release of any entity or other person
primarily or secondarily liable for any Obligation; (v) the adequacy of any rights which the
Administrative Agent or any Lender may have against any collateral security (if any) or other means
of obtaining repayment of any of the Obligations; (vi) the impairment of any collateral (if any)
securing any of the Obligations, including without limitation the failure to perfect or preserve
any rights which the Administrative Agent or any Lender might have in such collateral security (if
any) or the substitution, exchange, surrender, release, loss or destruction of any such collateral
security; or (vii) 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 (A) any “one action” or
“anti-deficiency” law which would otherwise prevent the Administrative Agent or any Lender 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 Administrative Agent’s or such Lender’s commencement or completion of any
foreclosure action, whether judicially, by exercise of power of sale or otherwise, or (B) any other
law which in any other way would otherwise require any election of remedies by the Administrative
Agent or any Lender.
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5. Unenforceability of Obligations Against Borrower. If for any reason the Borrower
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 the Borrower by reason of the Borrower’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 Borrower, 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.
6. Subrogation; Subordination.
6.1 Waiver of Rights Against Borrower. Until the final payment and performance in
full of all of the Obligations: (i) the Guarantor shall not exercise and hereby waives any rights
against the Borrower 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 Administrative Agent or any Lender in respect of any payment hereunder in any
bankruptcy, insolvency or reorganization case or proceedings of any nature; (ii) the Guarantor will
not claim any setoff, recoupment or counterclaim against the Borrower in respect of any liability
of the Guarantor to the Borrower; and (iii) the Guarantor waives any benefit of and any right to
participate in any collateral security which may be held by the Administrative Agent or any Lender.
6.2 Subordination. The payment of any amounts due with respect to any indebtedness
of the Borrower for money borrowed or credit received now or hereafter owed to the Guarantor is
hereby subordinated to the prior payment in full of all of the Obligations. 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 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 while any Obligations are still outstanding, such amounts shall be
collected, enforced and received by the Guarantor as trustee for the Lenders and the Administrative
Agent and be paid over to the Administrative Agent, for the benefit of the Lenders and the
Administrative Agent, on account of the Obligations without affecting in any manner the liability
of the Guarantor under the other provisions of this Guaranty.
6.3 Provisions Supplemental. The provisions of this §6 shall be supplemental to and
not in derogation of any rights and remedies of the Lenders and the Administrative Agent under any
separate subordination agreement which the Administrative Agent may at any time and from time to
time enter into with the Guarantor for the benefit of the Lenders and the Administrative Agent.
7. Security; Setoff. The Guarantor grants to each of the Administrative Agent and
the Lenders, as security for the full and punctual payment and performance of all of the
Guarantor’s obligations hereunder, a right of setoff , upon and against, all securities or other
property belonging to the Guarantor now or hereafter held by the Administrative Agent or such
Lender and in all deposits (general or special, time or demand, provisional or final) and other
sums credited by or due from the Administrative Agent or such Lender to the Guarantor or subject to
withdrawal by the Guarantor. Regardless of the adequacy of any collateral security (if any) or
other means of obtaining payment of any of the Obligations, if any
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Event of Default shall have
occurred, each of the Administrative Agent and the Lenders is hereby authorized, 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 Administrative Agent or such Lender shall have
made any demand under this Guaranty.
8. Further Assurances. The Guarantor agrees that it will from time to time, at the
request of the Administrative Agent, do all such things and execute all such documents as the
Administrative Agent may consider necessary or desirable to give full effect to this Guaranty and
to perfect and preserve the rights and powers of the Lenders and the Administrative Agent
hereunder. The Guarantor acknowledges and confirms that the Guarantor itself has established its
own adequate means of obtaining from the Borrower on a continuing basis all information desired by
the Guarantor concerning the financial condition of the Borrower and that the Guarantor will look
to the Borrower and not to the Administrative Agent or any Lender in order for the Guarantor to
keep adequately informed of changes in the Borrower’s financial condition.
9. Termination; Reinstatement. This Guaranty shall remain in full force and effect
until the Administrative 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 Administrative Agent at the address of the Administrative Agent for notices set
forth in §16.6 of the Credit Agreement. No such notice shall affect any rights of the
Administrative Agent or any Lender hereunder, including without limitation the rights set forth in
§§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 Administrative Agent or any Lender upon the
insolvency, bankruptcy or reorganization of the Borrower, or otherwise, all as though such payment had not
been made or value received.
10. Successors and Assigns. This Guaranty shall be binding upon the Guarantor, its
successors and assigns, and shall inure to the benefit of the Administrative Agent and the Lenders
and their respective successors, transferees and assigns. Without limiting the generality of the
foregoing sentence, each Lender 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 such Lender herein, all in
accordance with §15 of the Credit Agreement. The Guarantor may not assign any of its obligations
hereunder.
11. Amendments and Waivers. Any terms of this Guaranty may be amended, and the
performance or observance by the Guarantor of any term of this Guaranty may be waived (either
generally or in a particular instance and either retroactively or prospectively) only in accordance
with the terms of §16.12 of the Credit Agreement. No failure on the part of the Administrative
Agent or any Lender to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or
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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 Guarantor, at the address set forth beneath its signature hereto, and if to the Administrative
Agent, at the address for notices to the Administrative Agent set forth in §16.6 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. 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 §12. The Guarantor 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. 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
(i) certifies that neither the Administrative Agent or any Lender nor any representative, agent or
attorney of the Administrative Agent or any Lender has represented, expressly or otherwise, that
the Administrative Agent or any Lender 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 Administrative Agent or any Lender is a party, the Administrative Agent
and the Lenders are relying upon, among other things, the waivers and certifications contained in
this §14.
15. Miscellaneous. 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.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed and delivered as of
the date first above written.
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| AROMA NATURALS, INC. | ||||||
| By: | /s/ Xxxxxx Xxxx | |||||
| Chief Operating Officer | ||||||
| Address: | ||||||
| 00 Xxxxxx Xxxxxx Xxx | ||||||
| Xxxxx Xxxxxxxxx, XX 00000 | ||||||
| Telex: (000) 000-0000 | ||||||
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