GUARANTY AGREEMENT
This Guaranty Agreement (the "GUARANTY") dated as of this 31st day of
January, 1997, by the parties who have executed this Guaranty (such parties,
along with any other parties who execute and deliver to the Agent hereinafter
identified and defined an agreement in the form attached hereto as Exhibit A,
being herein referred to collectively as the "GUARANTORS" and individually as a
"GUARANTOR").
WITNESSETH:
WHEREAS, the Guarantors are subsidiaries of Ha-Lo Industries, Inc., an
Illinois corporation (the "COMPANY"); and
WHEREAS, the Company, American National Bank and Trust Company of Chicago
("ANB"), individually and as agent (ANB acting as such agent and any successor
or successors to ANB in such capacity being hereinafter referred to as the
"AGENT"), Xxxxxx Trust and Savings Bank ("HTSB") and Comerica Bank ("Comerica")
have entered into a Credit Agreement dated as of even date herewith (such Credit
Agreement as the same may hereafter be amended or modified from time to time,
including amendments and restatements thereof in its entirety, being hereinafter
referred to as the "CREDIT AGREEMENT") pursuant to which ANB, HTSB, Comerica and
such other lenders from time to time parties thereto (ANB, HTSB, Comerica and
such other lenders being hereinafter referred to collectively as the "LENDERS"
and individually as a "LENDER") have extended various credit facilities to the
Company (the Agent and the Lenders being hereinafter referred to collectively as
the "GUARANTEED CREDITORS" and individually as a "GUARANTEED CREDITOR"); and
WHEREAS, the Company provides each of the Guarantors with substantial
financial, management, administrative, and technical support; and
WHEREAS, as a condition to extending the credit facilities to the Company
under the Credit Agreement, the Lenders have required, among other things, that
the Guarantors execute and deliver this Guaranty; and
WHEREAS, each Guarantor will benefit, directly and indirectly, from credit
and other financial accommodations extended and to be extended by the Lenders to
the Company; and
NOW, THEREFORE, FOR VALUE RECEIVED, and in consideration of advances made
or to be made, or credit accommodations given or to be given, to the Company by
the Lenders from time to time, each Guarantor hereby makes the following
representations and warranties to, and hereby covenants and agrees with, the
Guaranteed Creditors as follows:
SECTION 1. All capitalized terms used herein without definition shall
have the same meanings herein as such terms have in the Credit Agreement.
SECTION 2. Each Guarantor hereby jointly and severally guarantees to
the Guaranteed Creditors, the due and punctual payment when due of (i) any and
all indebtedness, obligations and liabilities owing to the Guaranteed Creditors,
and any of them individually, by the Company under or in connection with or
evidenced by (x) the Credit Agreement or (y) all notes issued by the Company
under the Credit Agreement and any and all notes issued in extension or renewal
thereof or in substitution or replacement therefor (collectively, the "NOTES"),
in each case whether now existing or hereafter arising (and
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whether arising before or after the filing of a petition in bankruptcy), due or
to become due, direct or indirect, absolute or contingent, and howsoever
evidenced, held or acquired, (ii) the obligations of the Company to reimburse
the Guaranteed Creditors, and any of them individually, for the amount of all
drawings on all letters of credit (the "LETTERS OF CREDIT") issued for the
account of the Company pursuant to the Credit Agreement, and all other
obligations, whether now existing or hereafter arising (and whether arising
before or after the filing of a petition in bankruptcy), of the Company under
any and all applications for such Letters of Credit (each an "APPLICATION"; the
Notes, the Letters of Credit, the Credit Agreement, the Applications, and any
guaranty or other instrument or agreement executed by another subsidiary or
affiliate of the Company in connection therewith being hereinafter collectively
referred to as the "CREDIT DOCUMENTS"), and (iii) any and all expenses and
charges, legal or otherwise, suffered or incurred by the Guaranteed Creditors,
and any of them individually, in collecting or enforcing any of such
indebtedness, obligations and liabilities or in realizing on or protecting or
preserving any security therefor. The indebtedness, obligations and liabilities
described in the immediately preceding clauses (i), (ii), and (iii) are
hereinafter referred to as the "INDEBTEDNESS HEREBY GUARANTEED". In case of
failure by the Company punctually to pay any indebtedness hereby guaranteed,
each Guarantor hereby jointly and severally agrees to make such payment or to
cause such payment to be made punctually as and when the same shall become due
and payable, whether at stated maturity, by acceleration or otherwise, and as if
such payment were made by the Company. Notwithstanding anything contained in
this Guaranty to the contrary, the right of recovery against any Guarantor under
this Guaranty shall not exceed $1 less than the amount which would render such
Guarantor's Obligations under this Guaranty void or voidable under applicable
law, including, without limitation, fraudulent conveyance law.
SECTION 3. Each Guarantor further jointly and severally agrees to pay
all actual out-of-pocket expenses, legal and/or otherwise (including court costs
and reasonable attorneys' fees), paid or incurred by any Guaranteed Creditor in
enforcing or endeavoring to collect or enforce the indebtedness hereby
guaranteed or the Guarantors' obligations hereunder, or any part thereof, and in
protecting, defending or enforcing this Guaranty and the Guarantors' obligations
hereunder in any litigation, bankruptcy or insolvency proceedings or otherwise.
SECTION 4. Each Guarantor agrees that upon demand, such Guarantor will
then pay to the Agent for the benefit of the Guaranteed Creditors the full
amount of the indebtedness hereby guaranteed then due whether or not any one or
more of the other Guarantors shall then or thereafter pay any amount whatsoever
in respect to their obligations hereunder.
SECTION 5. Each of the Guarantors agrees that such Guarantor will not
exercise or enforce any right of exoneration, contribution, reimbursement,
recourse or subrogation available to such Guarantor against any person liable
for payment of the indebtedness hereby guaranteed, or as to any security
therefor, unless and until the full amount owing to the Guaranteed Creditors of
the indebtedness hereby guaranteed has been fully paid and satisfied and each of
the commitments by the Guaranteed Creditors to extend any indebtedness hereby
guaranteed shall have expired or otherwise terminated. The payment by any
Guarantor of any amount or amounts to the Guaranteed Creditors pursuant hereto
shall not in any way entitle any such Guarantor, either at law, in equity or
otherwise, to any
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right, title or interest (whether by way of subrogation or otherwise) in and to
the indebtedness hereby guaranteed or any part thereof or any collateral
security therefor or any other rights or remedies in any way relating thereto or
in and to any amounts theretofor, then or thereafter paid or applicable to the
payment thereof howsoever such payment may be made and from whatsoever source
such payment may be derived unless and until all of the indebtedness hereby
guaranteed and all costs and expenses suffered or incurred by the Guaranteed
Creditors in enforcing this Guaranty have been paid and satisfied in full and
each of the commitments by the Guaranteed Creditors to extend any indebtedness
hereby guaranteed shall have expired or otherwise terminated; and, unless and
until such payment in full and termination, any payments made by any Guarantor
hereunder and any other payments from whatsoever source derived on account of or
applicable to the indebtedness hereby guaranteed or any part thereof shall be
held and taken to be merely payments in gross to the Guaranteed Creditors
reducing pro tanto the indebtedness hereby guaranteed.
SECTION 6. To the extent permitted by the Credit Agreement, each
Guaranteed Creditor may, without any notice whatsoever to any of the Guarantors,
sell, assign, or transfer all of the indebtedness hereby guaranteed, or any part
thereof, or grant participations therein, and in that event each and every
immediate and successive assignee, transferee, or holder of all or any part of
the indebtedness hereby guaranteed, shall have the right through the Agent
pursuant to Section 18 hereof to enforce this Guaranty, by suit or otherwise,
for the benefit of such assignee, transferee, or holder as fully as if such
assignee, transferee, or holder were herein by name specifically given such
rights, powers and benefits; but each Guaranteed Creditor through the Agent
pursuant to Section 18 hereof shall have an unimpaired right to enforce this
Guaranty for its own benefit, as to so much of the indebtedness hereby
guaranteed that it has not sold, assigned or transferred.
SECTION 7. This Guaranty is a continuing, absolute and unconditional
Guaranty, and shall remain in full force and effect until written notice of its
discontinuance executed by the Company and all the Guarantors shall be actually
received by the Guaranteed Creditors, and also until any and all of the
indebtedness hereby guaranteed which was created or existing before receipt of
such notice shall be fully paid and satisfied and each of the commitments by the
Guaranteed Creditors to extend any indebtedness hereby guaranteed shall have
expired or otherwise terminated. The dissolution of any Guarantor shall not
terminate this Guaranty as to such Guarantor until notice of such dissolution
shall have been actually received by the Guaranteed Creditors, nor until all of
the indebtedness hereby guaranteed, created or existing or committed to be
extended in each case before receipt of such notice shall be fully paid and
satisfied. The Guaranteed Creditors may at any time or from time to time
release any Guarantor from its obligations hereunder or effect any compromise
with any Guarantor and no such release or compromise shall in any manner impair
or otherwise affect the obligations hereunder of the other Guarantors. No
release, compromise, or discharge of any one or more of the Guarantors shall
release, compromise or discharge the obligations of the other Guarantors
hereunder.
SECTION 8. In case of the dissolution, liquidation or insolvency
(howsoever evidenced) of, or the institution of bankruptcy or receivership
proceedings against the Company or any Guarantor, all of the indebtedness hereby
guaranteed which is then existing shall, at the
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option of the Lenders in accordance with the terms of the Credit Agreement,
immediately become due or accrued and payable from the Guarantors. All payments
received from the Company or on account of the indebtedness hereby guaranteed
from whatsoever source, shall be taken and applied as payment in gross, and this
Guaranty shall apply to and secure any ultimate balance that shall remain owing
to the Guaranteed Creditors.
SECTION 9. The liability hereunder shall in no way be affected or
impaired by (and the Guaranteed Creditors are hereby expressly authorized to
make from time to time, without notice to any of the Guarantors), any sale,
pledge, surrender, compromise, settlement, release, renewal, extension,
indulgence, alteration, substitution, exchange, change in, modification or other
disposition of any of the indebtedness hereby guaranteed, either express or
implied, or of any Credit Document or any other contract or contracts evidencing
any thereof, or of any security or collateral therefor or any guaranty thereof.
The liability hereunder shall in no way be affected or impaired by any
acceptance by the Guaranteed Creditors of any security for or other guarantors
upon any of the indebtedness hereby guaranteed, or by any failure, neglect or
omission on the part of the Guaranteed Creditors to realize upon or protect any
of the indebtedness hereby guaranteed, or any collateral or security therefor,
or to exercise any lien upon or right of appropriation of any moneys, credits or
property of the Company or any Guarantor, possessed by any of the Guaranteed
Creditors, toward the liquidation of the indebtedness hereby guaranteed, or by
any application of payments or credits thereon. The Guaranteed Creditors shall
have the exclusive right to determine how, when and what application of payments
and credits, if any, shall be made on said indebtedness hereby guaranteed, or
any part of same. In order to hold any Guarantor liable hereunder, there shall
be no obligation on the part of the Guaranteed Creditors, at any time, to resort
for payment to the Company or to any other Guarantor, or to any other person,
its property or estate, or resort to any collateral, security, property, liens
or other rights or remedies whatsoever, and the Guaranteed Creditors shall have
the right to enforce this Guaranty against any Guarantor irrespective of whether
or not other proceedings or steps are pending seeking resort to or realization
upon or from any of the foregoing.
SECTION 10. In the event the Guaranteed Creditors shall at any time in
their discretion permit a substitution of Guarantors hereunder or a party shall
wish to become Guarantor hereunder, such substituted or additional Guarantor
shall, upon executing an agreement in the form attached hereto as Exhibit A,
become a party hereto and be bound by all the terms and conditions hereof to the
same extent as though such Guarantor had originally executed this Guaranty and
in the case of a substitution, in lieu of the Guarantor being replaced. No such
substitution shall be effective absent the written consent of the Guaranteed
Creditors nor shall it in any manner affect the obligations of the other
Guarantors hereunder.
SECTION 11. All diligence in collection or protection, and all
presentment, demand, protest and/or notice, as to any and everyone, whether or
not the Company or the Guarantors or others, of dishonor and of default and of
non-payment and of the creation and existence of any and all of said
indebtedness hereby guaranteed, and of any security and collateral therefor, and
of the acceptance of this Guaranty, and of any and all extensions of credit and
indulgence hereunder, are expressly waived.
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SECTION 12. No act of commission or omission of any kind, or at any
time, upon the part of the Guaranteed Creditors in respect to any matter
whatsoever, shall in any way affect or impair this Guaranty.
SECTION 13. The Guarantors waive, to the extent permitted by applicable
law, any and all defenses, claims and discharges of the Company, or any other
obligor, pertaining to the indebtedness hereby guaranteed, except the defense of
discharge by payment in full. Without limiting the generality of the foregoing,
to the extent permitted by applicable law, the Guarantors will not assert, plead
or enforce against the Guaranteed Creditors any defense of waiver, release,
discharge in bankruptcy, statute of limitations, res judicata, statue of frauds,
anti-deficiency statute, fraud, incapacity, minority, usury, illegality or
unenforceability which may be available to the Company or any other person
liable in respect of any of the indebtedness hereby guaranteed, or any set-off
available against the Guaranteed Creditors to the Company or any such other
person, whether or not on account of a related transaction. The Guarantors
agree that the Guarantors shall be and remain jointly and severally liable for
any deficiency remaining after foreclosure or other realization on any lien or
security interest securing the indebtedness hereby guaranteed, whether or not
the liability of the Company or any other obligor for such deficiency is
discharged pursuant to statute or judicial decision.
SECTION 14. If any payment applied by the Guaranteed Creditors to the
indebtedness hereby guaranteed is thereafter set aside, recovered, rescinded or
required to be returned for any reason (including, without limitation, the
bankruptcy, insolvency or reorganization of the Company or any other obligor),
the indebtedness hereby guaranteed to which such payment was applied shall for
the purposes of this Guaranty be deemed to have continued in existence,
notwithstanding such application, and this Guaranty shall be enforceable as to
such of the indebtedness hereby guaranteed as fully as if such application had
never been made.
SECTION 15. The liability of the Guarantors under this Guaranty is in
addition to and shall be cumulative with all other liabilities of the Guarantors
to the Guaranteed Creditors as a guarantor of the indebtedness hereby
guaranteed, without any limitation as to amount, unless the instrument or
agreement evidencing or creating such other liability specifically provides to
the contrary.
SECTION 16. Any invalidity or unenforceability of any provision or
application of this Guaranty shall not affect other lawful provisions and
applications hereof, and to this end the provisions of this Guaranty are
declared to be severable. Without limiting the generality of the foregoing, any
invalidity or unenforceability against any Guarantor of any provision or
application of the Guaranty shall not affect the validity or enforceability of
the provisions or application of this Guaranty as against the other Guarantors.
SECTION 17. Any demand for payment on this Guaranty or any other notice
required or desired to be given hereunder to any Guarantor shall be in writing
(including, without limitation, notice by telecopy) and shall be given to the
relevant party at its address or telecopier number set forth on the appropriate
signature page hereof, or such other address or telecopier number as such party
may hereafter specify by notice to the Agent given by United States certified or
registered mail, by telecopy or by other telecommunication device
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capable of creating a written record of such notice and its receipt. Each such
notice, request or other communication shall be effective (i) if given by
telecopier, when such telecopy is transmitted to the telecopier number specified
in this Section and a confirmation of such telecopy has been received by the
sender, (ii) if given by mail, five (5) days after such communication is
deposited in the mail, certified or registered with return receipt requested,
addressed as aforesaid or (iii) if given by any other means, when delivered at
the addresses specified in this Section.
SECTION 18. No Lender shall have the right to institute any suit, action
or proceeding in equity or at law in connection with this Guaranty for the
enforcement of any remedy under or upon this Guaranty; it being understood and
intended that no one or more of the Lenders shall have any right in any manner
whatsoever to enforce any right hereunder, and that all proceedings at law or in
equity shall be instituted, had and maintained by the Agent in the manner herein
provided and for the benefit of the Lenders.
SECTION 19. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED ACCORDING
TO THE LAW OF THE STATE OF ILLINOIS (without regard to principles of conflicts
of laws) in which state it shall be performed by the Guarantors and may not be
waived, amended, released or otherwise changed except by a writing signed by the
Agent. This Guaranty and every part thereof shall be effective upon delivery to
the Agent, without further act, condition or acceptance by the Guaranteed
Creditors, shall be binding upon the Guarantors and upon the legal
representatives, successors and assigns of the Guarantors, and shall inure to
the benefit of the Guaranteed Creditors, their successors, legal representatives
and assigns. The Guarantors waive notice of the Guaranteed Creditors'
acceptance hereof. This Guaranty may be executed in counterparts, and by
different parties hereto on separate counterparts signature pages, each of which
shall be an original, but all together to be one and the same instrument.
SECTION 20. Each Guarantor hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Northern District of
Illinois and of any Illinois State court sitting in the City of Chicago for
purposes of all legal proceedings arising out of or relating to this Guaranty,
the other Credit Documents or the transactions contemplated hereby or thereby.
Each Guarantor irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such court has been brought in an inconvenient forum. EACH GUARANTOR
AND EACH GUARANTEED CREDITOR HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
GUARANTY OR ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY.
[SIGNATURE PAGES TO FOLLOW]
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IN WITNESS WHEREOF, the Guarantors have caused this Guaranty to be executed
and delivered as of the date first above written.
"GUARANTORS"
XXXXXXXX, XXXXXXXXX & WHITE, INC.
By
Its
---------------------------------
Address:
0000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention Xx. Xxxx Xxxxxx
Telephone (000) 000-0000
Telecopy (000) 000-0000
HA-LO SPORTS, INC.
By
Its
---------------------------------
Address:
0000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention Xx. Xxxx Xxxxxx
Telephone (000) 000-0000
Telecopy (000) 000-0000
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MARKET U.S.A., INC.
By
Its
---------------------------------
Address:
0000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention Xx. Xxxx Xxxxxx
Telephone (000) 000-0000
Telecopy (000) 000-0000
CREATIVE CONCEPTS IN ADVERTISING, INC.
By
Its
---------------------------------
Address:
0000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Attention Xx. Xxxx Xxxxxx
Telephone (000) 000-0000
Telecopy (000) 000-0000
Accepted and agreed to in Chicago, Illinois as of the date first above
written.
AMERICAN NATIONAL BANK AND TRUST
COMPANY OF CHICAGO, as Agent
By
Its
---------------------------------
Address:
00 Xxxxx XxXxxxx Xxxxxx, 00xx Xxxxx
Corporate Finance Division
Xxxxxxx, Xxxxxxxx 00000
Attention Xxxx Xxxxxxxxx
Telephone (000) 000-0000
Telecopy (000) 000-0000
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EXHIBIT A
TO
GUARANTY AGREEMENT
ASSUMPTION AND SUPPLEMENT TO GUARANTY AGREEMENT
This Assumption and Supplement to Guaranty Agreement (the "AGREEMENT") is
dated as of this _____ day of ____________, 199___, made by [NEW GUARANTOR], a
___________ corporation (the "NEW GUARANTOR");
WITNESSETH THAT:
WHEREAS, certain parties have executed and delivered to the Guaranteed
Creditors that certain Guaranty Agreement dated as of January 31, 1997, or
supplements thereto (such Guaranty Agreement, as the same may from time to time
be modified or amended, including supplements thereto which add or substitute
parties as Guarantors thereunder, being hereinafter referred to as the
"GUARANTY") pursuant to which such parties (the "EXISTING GUARANTORS") have
guaranteed to the Guaranteed Creditors the full and prompt payment of, among
other things, any and all indebtedness, obligations and liabilities of HA-LO
Industries, Inc. (the "COMPANY") arising under or relating to the Credit
Agreement and the other Credit Documents described therein; and
WHEREAS, the Company provides the New Guarantor with substantial financial,
managerial, administrative, technical and design support and the New Guarantor
will benefit, directly and indirectly, from credit and other financial
accommodations extended and to be extended by the Lenders to the Company;
NOW, THEREFORE, FOR VALUE RECEIVED, and in consideration of advances made
or to be made, or credit accommodations given or to be given, to the Company by
the Lenders from time to time, the New Guarantor hereby agrees as follows:
1. The New Guarantor acknowledges and agrees that it shall become a
"Guarantor" party to the Guaranty effective upon the date the New Guarantor's
execution of this Agreement and the delivery of this Agreement to the Agent on
behalf of the Guaranteed Creditors, and that upon such execution and delivery,
all references in the Guaranty to the terms "Guarantor" or "Guarantors" shall be
deemed to include the New Guarantor.
2. The New Guarantor hereby assumes and becomes liable (jointly and
severally with all the other Guarantors) for the indebtedness hereby guaranteed
(as defined in the Guaranty) and agrees to pay and otherwise perform all of the
obligations of a Guarantor under the Guaranty according to, and otherwise on and
subject to, the terms and conditions of the Guaranty to the same extent and with
the same force and effect as if the New Guarantor had originally been one of the
Existing Guarantors under the Guaranty and had originally executed the same as
such an Existing Guarantor.
3. All capitalized terms used in this Agreement without definition shall
have the same meaning herein as such terms have in the Guaranty, except that any
reference to the term "Guarantor" or "Guarantors" and any provision of the
Guaranty providing meaning to such term shall be deemed a reference to the
Existing Guarantors and the New Guarantor. Except as specifically modified
hereby, all of the terms and conditions of the Guaranty shall stand and remain
unchanged and in full force and effect.
4. The New Guarantor agrees to execute and deliver such further
instruments and documents and do such further acts and things as the Agent or
the Guaranteed Creditors may deem necessary or proper to carry out more
effectively the purposes of this Agreement.
5. No reference to this Agreement need be made in the Guaranty or in any
other document or instrument making reference to the Guaranty, any reference to
the Guaranty in any of such to be deemed a reference to the Guaranty as modified
hereby.
6. This Agreement shall be governed by and construed in accordance with
the State of Illinois (without regard to principles of conflicts of law) in
which
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state it shall be performed by the New Guarantor.
[NEW GUARANTOR]
By
Its
---------------------------------
Address:
----------------------------------------
----------------------------------------
----------------------------------------
Attention
------------------------------
Telephone
------------------------------
Telecopy
-------------------------------
Acknowledged and agreed to in Chicago, Illinois as of the date first above
written.
AMERICAN NATIONAL BANK AND TRUST COMPANY
OF CHICAGO, as Agent
By
Its
---------------------------------
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