EXHIBIT 10.13
GUARANTY OF XXXXXX XXXX ASSOCIATES
GUARANTY AGREEMENT (this "Guaranty"), dated as of July 28, 2000, between
XXXXXX HILL ASSOCIATES, a California general partnership (the "Guarantor") and
Citadel Cinemas, Inc., a Nevada corporation (together with its successors, the
"Beneficiary").
RECITALS
A. The Guarantor is the sole member of Xxxxxx Xxxx Capital, L.L.C., a New
York limited liability company (together with its permitted successors, the
"Company").
B. The Beneficiary and the Company are about to enter into an agreement,
dated as of the date hereof (as the same may be amended, restated, modified or
supplemented from time to time, the "Lease Agreement"), pursuant to which the
Company will sublease various Theatre Properties as described therein to the
Beneficiary.
C. The Company has agreed to make certain representations and warranties
to the Beneficiary in subsection 2.3 of the Lease Agreement.
D. The Beneficiary and the Company are about to enter into a letter
agreement, dated as of the date hereof (as the same may be amended, restated,
modified or supplemented from time to time, the "Financial Letter Agreement"),
pursuant to which the Company has agreed to make certain representations and
warranties regarding the financial condition of the operations of the Theatre
Properties.
E. The Beneficiary and the Company's affiliate, City Cinemas Corporation,
a New York corporation ("City Cinemas"), are about to enter into an agreement,
dated as of the date hereof (as the same may be amended, restated, modified or
supplemented from time to time, the "Employee Letter"), pursuant to which the
Beneficiary has agreed to assume the duties and responsibilities as employer
with respect to the employees of City Cinemas.
F. City Cinemas has agreed to make certain representations and warranties
to the Beneficiary with respect to the employees in Section 2 of the Employee
Letter.
G. The Beneficiary is unwilling to enter into the Lease Agreement, the
Financial Letter Agreement and the Employee Letter unless the Guarantor enters
into this Guaranty.
NOW THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor hereby agrees as follows:
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Section 1. Guaranty of Obligations. Subject to the terms and conditions
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in this Guaranty, the Guarantor hereby unconditionally guarantees to the
Beneficiary the due and punctual payment when due of all amounts arising under
the Lease Agreement and Financial Letter Agreement, as the case may be, as a
result of the Company's breach of the representations and warranties made in
subsection 2.3 of the Lease Agreement and in the Financial Letter Agreement and
arising under the Employee Letter as a result of City Cinemas' breach of the
representations and warranties made in Section 2 of the Employee Letter (such
obligations being herein called the "Obligations"), and agrees to pay any and
all reasonable expenses incurred by the Beneficiary in successfully enforcing
any rights under this Guaranty. This Guaranty is a primary and original
obligation of the Guarantor and is an absolute, unconditional, continuing and
irrevocable guaranty of payment and not of collectibility or performance and is
in no way conditioned or contingent upon any attempt to collect from the Company
or City Cinemas, as the case may be, or to realize upon any property
constituting security for the Obligations, all to the same extent, except as
otherwise specifically provided herein, as if the Guarantor were the Company
under the Lease Agreement or Financial Letter Agreement, or City Cinemas under
the Employee Letter; provided, however, that the foregoing limitation imposing
on the Guarantor obligations hereunder as if it were the Company under the Lease
Agreement or Financial Letter Agreement, or City Cinemas under the Employee
Letter (except as set forth herein) shall not limit obligations of the Guarantor
hereunder to the extent the limitations (including termination, disavowal,
rejection or reduction) of any such obligation of the Company or City Cinemas,
as the case may be, results from (a) any insolvency or bankruptcy case or
proceeding (including any case under the U.S. Bankruptcy Code of 1978, as
amended), or any receivership, liquidation, reorganization or other similar case
or proceeding relative to the Company or City Cinemas, as the case may be, or
all or substantially all of their respective assets, or (b) any liquidation,
dissolution, reorganization or winding up of the Company or City Cinemas, as the
case may be, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment of all or substantially all of
the assets of the Company or City Cinemas, as the case may be, for the benefit
of creditors or any other marshalling of assets and liabilities of the Company
or City Cinemas, as the case may be (the events in (a), (b) and (c) collectively
referred to as an "Insolvency or Liquidation Proceeding"), and in such event the
Guarantor shall be liable in respect of obligations of the Company pursuant to
the Lease Agreement or Financial Letter Agreement, or of City Cinemas pursuant
to the Employee Letter, as if no such Insolvency or Liquidation Proceeding had
been initiated. If the Company or City Cinemas, as the case may be, shall fail
to pay any of the Obligations when and as the same shall become due and payable,
the Guarantor shall forthwith pay such Obligations, in immediately available
funds, directly to the Beneficiary at its address specified herein or at such
other place as the Beneficiary shall direct. The Guarantor hereby waives
diligence, presentment or protest. Each default in payment of any of the
Obligations shall give rise to a separate cause of action hereunder and separate
suits may be brought hereunder as each cause of action arises. Notwithstanding
anything herein to the
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contrary, the obligations of the Guarantor hereunder shall be limited to the
same extent as set forth in paragraph (c) of Section 11 of the Lease Agreement,
but shall not be limited by the provisions of Section 30 of the Lease Agreement.
Section 2. Character of Obligations Hereunder: Subrogation. (a) The
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right of the Beneficiary to enforce the obligations of the Guarantor hereunder
by any proceedings, whether by action at law, suit in equity or otherwise, shall
not be impaired by any right, claim or defense (against the Company or any other
person) of any character whatsoever, including without limitation any right,
claim or defense of rescission, recoupment, reduction, limitation, termination,
setoff, counterclaim, waiver, frustration, surrender, alteration or compromise
except, and then only to the extent, any such right, claim or defense would have
been available to the Company pursuant to the Lease Agreement or Financial
Letter Agreement, or to City Cinemas pursuant to the Employee Letter. Without
limiting the generality of the foregoing, such obligations of the Guarantor
shall not be discharged, released or impaired or otherwise affected by: (i) any
renewal, extension, amendment or modification of or addition or supplement to or
deletion from this Guaranty or the Lease Agreement, Financial Letter Agreement
or Employee Letter except to the extent of the Company's or City Cinemas'
rights, claims or defenses thereunder as aforesaid, as the case may be; (ii) any
inability or failure on the part of the Company to perform or comply with the
Lease Agreement or Financial Letter Agreement or on the part of City Cinemas to
perform or comply with the Employee Letter; (iii) any waiver, consent,
extension, indulgence or other action or inaction (including, without
limitation, any lack of diligence) under or in respect of this Guaranty, the
Lease Agreement, the Financial Letter Agreement, the Employee Letter or any
obligation or liability of the Company or City Cinemas, or any other person, or
any exercise or non-exercise of any right, power or remedy under or in respect
of any such agreement or any such obligation or liability; (iv) any Insolvency
or Liquidation Proceeding; and (v) any limitation or any party's obligation or
liability under any such agreement or any such obligation or liability or any
termination, cancellation, frustration, invalidity or enforceability, in whole
or in part, of any such agreement or any such obligation or liability or any
term of any thereof except to the extent of the Company's or City Cinemas'
rights, claims or defenses thereunder as aforesaid.
(b) This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Obligations is rescinded
or must otherwise be returned by the Beneficiary upon the insolvency, bankruptcy
or reorganization of the Company or City Cinemas or otherwise, all as though
such payment had not been made.
(c) The Guarantor will not exercise any rights which it may acquire by way
of subrogation under this Guaranty, by any payment made hereunder or otherwise,
until all of the Obligations shall have been paid in full. If any amount shall
be paid to the Guarantor on account of such subrogation rights at any time when
all the Obligations then outstanding shall not have been indefeasibly paid in
full, such amount shall be held in trust for the benefit of the Beneficiary and
shall forthwith be paid to the Beneficiary and applied upon the Obligations,
whether matured
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or unmatured. If (i) the Guarantor shall make payment to the Beneficiary of all
or any part of the Obligations and (ii) all the Obligations shall be paid in
full and the period under the Lease Agreement, Financial Letter Agreement and
Employee Letter for the Beneficiary to assert claims against the Company or City
Cinemas shall have expired, the Beneficiary will, at the Guarantor's request,
execute and deliver to the Guarantor appropriate documents, without recourse and
without representation or warranty, necessary to evidence the transfer by
subrogation to the Guarantor of an interest in the Obligations resulting from
such payment by the Guarantor.
Section 3. Representations and Warranties of the Guarantor. The Guarantor
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represents and warrants to the Beneficiary that:
(a) The Guarantor is a general partnership duly organized and
validly existing under the laws of California and has full power, authority
and legal right to carry on its business as currently conducted, to own its
properties and to enter into and perform its obligations under this
Guaranty;
(b) The execution, delivery and performance by the Guarantor of
this Guaranty have been duly authorized by all necessary partnership action
and do not and will not contravene any presently existing law or any
governmental rule, regulation or order applicable to the Guarantor or its
properties;
(c) The execution, delivery and performance by the Guarantor of
this Guaranty do not require the consent or approval or authorization or
order of, the giving of notice to, or the registration with, or the taking
of any other action in respect of, any governmental authority or agency,
foreign or domestic, other than such as have been duly obtained, given or
taken; and
(d) This Guaranty has been duly executed and delivered by the
Guarantor and constitutes the legal, valid and binding obligation of the
Guarantor, enforceable against the Guarantor in accordance with its terms,
except as the enforceability of this Guaranty may be limited by the effect
of any applicable bankruptcy, insolvency, reorganization, moratorium, or
similar laws affecting creditors' rights generally and by general
principles of equity.
Section 4. Miscellaneous.
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(a) No failure on the part of the Beneficiary to exercise, no delay in
exercising, and no course of dealing with respect to, any right or remedy
hereunder will operate as a waiver thereof; nor will any single or partial
exercise of any right or remedy hereunder preclude any exercise of any other
right or remedy. This Guaranty may not be amended or modified except by written
agreement of the Guarantor and the Beneficiary.
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(b) All notices in connection with this Guaranty shall be in writing,
shall be deemed given and shall become effective when delivered by hand or
courier service or received by telex, telecopier, telegram, cable or registered
or certified first-class mail, postage prepaid, addressed as follows: if to the
Guarantor, at 000 Xxxxx Xxxxxxxxx Xxxx., Xxx Xxxxxxx, Xxxxxxxxxx 00000; if to
the Beneficiary, addressed to 000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxx, XX
00000, or at such other addresses which either of the foregoing shall from time
to time designate in writing.
(c) The terms of this Guaranty shall be binding upon the Guarantor and its
successors and assigns and shall inure to the benefit of, and be enforceable by,
the Beneficiary and its successors and assigns.
(d) This Guaranty shall be construed in accordance with and governed by
the internal laws of the State of New York.
(e) If any term of this Guaranty and any other application thereof shall
be invalid or unenforceable, the remainder of this Guaranty and any other
application of such terms shall not be affected thereby.
(f) Each of the parties hereto (i) hereby irrevocably submits to the non-
exclusive jurisdiction of the Supreme Court of the State of New York, New York
County (without prejudice to the right of any party to remove to the United
States District Court for the Southern District of New York) and to the non-
exclusive jurisdiction of the United States District Court for the Southern
District of New York, for the purposes of any suit, action or other proceeding
arising out of this Guaranty or the subject matter hereof or any of the
transactions contemplated hereby or thereby brought by either of the parties
hereto or their successors or assigns, (ii) hereby irrevocably agrees that all
claims in respect of such action or proceeding may be heard and determined in
such New York State court or, to the fullest extent permitted by applicable law,
in such Federal court, (iii) hereby waives any right it may have to trial by
jury in respect of any litigation based on, arising out of, under or in
connection with this Guaranty, and (iv) to the extent permitted by applicable
law, hereby irrevocably waives, and agrees not to assert, by way of motion, as a
defense or otherwise, in any such suit, action or proceeding any claim that it
is not subject to the jurisdiction of the above-named courts, that the suit,
action or proceeding is brought in an inconvenient forum, that the venue of the
suit, action or proceeding is improper or that this Guaranty or the subject
matter hereof may not be enforced in or by such court. A final judgment obtained
in respect of any action, suit or proceeding referred to in this Section 4 shall
be conclusive and may be enforced in other jurisdictions by suit or judgment or
in any manner as provided by applicable law. Each of the parties hereto hereby
consents to service of process by registered mail, Federal Express, DHL or
similar courier at the address to which notices to it are to be given, it being
agreed that service in such manner shall constitute valid service upon such
party or its respective successors or assigns in connection with any such action
or proceeding only; provided, however, that nothing in this Section 4 shall
affect the right of any of such parties or their respective successors or
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assigns to serve legal process in any other manner permitted by applicable law
or affect the right of any of such parties or its respective successors or
assigns to bring any action or proceeding against any other one of such parties
or its respective property in the courts of other jurisdictions.
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IN WITNESS WHEREOF, the parties hereto have caused this Guaranty to be duly
executed as of the date first set forth herein.
GUARANTOR:
XXXXXX XXXX ASSOCIATES
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Partner
BENEFICIARY:
CITADEL CINEMAS, INC.
By: /s/ Xxxxxxx Xxxxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxxxx
Title: Chief Financial Officer
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