Corporate Guaranty
Corporate
Guaranty
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Borrower:
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USA
DETERGENTS, INC., a
Delaware corporation
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Guarantors (each,
a Guarantor):
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APPALACHIAN
OIL COMPANY, a Tennessee corporation
APPCO-KY,
INC., a Tennessee corporation
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GBC
FUNDING, LLC ("Lender")
has
agreed to provide certain financial accommodations to Borrower pursuant to
the
terms of the Loan and Security Agreement between Borrower and Lender dated
as of
December 27, 2006 (as amended, modified or otherwise supplemented from time
to time, including pursuant to the Amendment Agreement (as defined below),
the
"Loan
Agreement";
capitalized terms used herein but not otherwise defined herein shall have the
meaning set forth in the Loan Agreement). Borrower has requested that Lender
provide additional financial accommodations to Borrower pursuant to the terms
of
the Amendment No. 2 to Loan and Security Agreement between Borrower and
Lender dated of even date herewith (as amended, modified or otherwise
supplemented from time to time, the "Amendment
Agreement").
As
one of the conditions to providing such additional financing, Lender has
required that each Guarantor guaranty all obligations of Borrower to Lender
pursuant to the terms hereof.
For
value
received and in consideration of any loan, advance or financial accommodation
of
any kind whatsoever heretofore, now or hereafter made, given or granted to
Borrower by Lender pursuant to the Loan Agreement, Guarantors unconditionally,
and jointly and severally, guaranty the full and prompt payment when due,
whether at maturity or earlier, by reason of acceleration or otherwise, and
at
all times thereafter, of the indebtedness, liabilities and obligations of every
kind and nature of Borrower to Lender (including, without limitation, all
interest accruing after the filing of a proceeding under the Bankruptcy Code
or
any other applicable insolvency law whether or not allowed by the court in
such
proceeding, and all other indebtedness, liabilities and obligations arising
after the filing of any proceeding under the Bankruptcy Code or any other
applicable insolvency law), howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, joint or several, now or hereafter
existing, or due or to become due, in each case arising under the Loan
Agreement, the Amendment Agreement or the other Loan Documents, plus all costs
and expenses (including, without limitation, all court costs and reasonable
attorneys' and paralegals' fees and expenses) paid or incurred by Lender in
endeavoring to collect all or any part of such indebtedness, liabilities and
obligations from, or in prosecuting any action against, any Guarantor or any
other guarantor of all or any part of such indebtedness, liabilities and
obligations (all such indebtedness, liabilities, obligations, costs and expenses
being hereinafter referred to as "Borrower's
Obligations").
All
sums becoming due under this Guaranty shall bear interest from the due date
thereof until paid at the highest rate charged with respect to any of Borrower's
Obligations under the Loan Agreement.
Each
Guarantor agrees that its obligations under this Guaranty are unconditional,
irrespective of (i) the validity or enforceability of Borrower's Obligations
or
any note or other instrument evidencing Borrower's Obligations, (ii) the absence
of any attempt by Lender to collect Borrower's Obligations from Borrower or
any
other guarantor, (iii) Lender's waiver or consent with respect to any provision
of the Loan Documents, (iv) Lender's failure to perfect or maintain its security
interests in, or to preserve its rights with respect to, any of the Collateral,
(v) Lender's election, in any proceeding under Chapter 11 of the Bankruptcy
Code
or other applicable insolvency law, of the application of Section 1111(b)(2)
of
the Bankruptcy Code or similar provision of any other applicable insolvency
law,
(vi) any borrowing or grant of a security interest by Borrower as
debtor-in-possession under Section 364 of the Bankruptcy Code or similar
provision of any other applicable insolvency law, (vii) the disallowance, under
Section 502 of the Bankruptcy Code or similar provision of any other applicable
insolvency law, of all or any of Lender's claims for repayment of Borrower's
Obligations or (viii) any other circumstance which might constitute a legal
or
equitable discharge or defense of Borrower or any guarantor.
No
payment made by or for the account or benefit of any Guarantor (including,
without limitation, (i) a payment made by Borrower in respect of Borrower's
Obligations, (ii) a payment made by any other Guarantor under this Guaranty
or
by any other person under any other guaranty of Borrower's Obligations or (iii)
a payment made by means of set off or other application of funds by Lender)
shall entitle any Guarantor, by subrogation or otherwise, to any payment by
Borrower or any other Guarantor or from or out of any property of Borrower
or
any other Guarantor, and each Guarantor shall not exercise any rights or
remedies against Borrower or any other Guarantor or any property of Borrower
or
any other Guarantor including, without limitation, any right of contribution,
indemnity or reimbursement by reason of any performance by such Guarantor under
this Guaranty, all of such rights of subrogation, contribution, indemnity and
reimbursement being hereby waived by such Guarantor. The provisions of this
paragraph shall survive the termination of this Guaranty or the release or
discharge of any Guarantors from liability hereunder. Borrower is a third party
beneficiary of the provisions of this paragraph.
Each
Guarantor hereby waives diligence, presentment, demand for payment, filing
of
claims with a court in the event of receivership or bankruptcy of Borrower,
protest or notice with respect to Borrower's Obligations and all demands
whatsoever, and covenants that this Guaranty will not be discharged, except
by
complete and irrevocable payment and performance of the obligations and
liabilities contained herein. No notice to any party, including any Guarantor,
shall be required for Lender to make demand hereunder. Such demand shall
constitute a mature and liquidated claim against the Guarantors. At any time
after the maturity of any of Borrower's Obligations, whether by acceleration
or
otherwise, Lender may, at its sole election, proceed directly and at once,
without notice, against any Guarantor to collect and recover the full amount
or
any portion of Borrower's Obligations, without first proceeding against Borrower
or any other person or against any of the Collateral. Lender shall have the
exclusive right to determine the application of payments and credits, if any,
from any Guarantor, Borrower or any other person, on account of Borrower's
Obligations.
Lender
is
hereby authorized, without notice or demand to any Guarantor and without
affecting or impairing the liability of any Guarantor hereunder, to from time
to
time (i) renew, extend, accelerate or otherwise change the time for payment
of, or other terms relating to, Borrower's Obligations or otherwise modify,
amend or change the terms of any promissory note or other agreement, document
or
instrument now or hereafter executed by Borrower and delivered to Lender; (ii)
accept partial payments on Borrower's Obligations; (iii) take and hold
Collateral for the payment of Borrower's Obligations, or for the payment of
this
Guaranty, or for the payment of any other guaranties of Borrower's Obligations
or other liabilities of Borrower, and exchange, enforce, waive and release
any
Collateral; (iv) apply Collateral and direct the order or manner of sale thereof
as it may determine in its sole discretion; and (v) settle, release, compromise,
collect or otherwise liquidate Borrower's Obligations and any Collateral in
any
manner.
-2-
At
any
time after maturity of Borrower's Obligations, Lender may, in its sole
discretion, without notice to any Guarantor and regardless of the acceptance
of
any Collateral for the payment hereof, appropriate and apply toward payments
of
Borrower's Obligations, (i) any indebtedness due or to become due from
Lender to any Guarantor and (ii) any moneys, credits or other property belonging
to any Guarantor at any time held by or coming into the possession of Lender
or
any affiliates of Lender, whether for deposit or otherwise.
Each
Guarantor assumes responsibility for keeping itself informed of the financial
condition of Borrower and all other guarantors of all or any of Borrower's
Obligations, and of all other circumstances bearing upon the risk of nonpayment
of Borrower's Obligations or any part thereof that diligent inquiry might
reveal, and each Guarantor agrees that Lender shall have no duty to advise
such
Guarantor of information known to Lender regarding any of the foregoing. Each
Guarantor acknowledges familiarity with Borrower's financial condition and
represents that it has not relied on any statements made, or information
furnished, by Lender or its agents in obtaining such familiarity. If Lender
provides any such information to any Guarantor, Lender shall be under no
obligation to (i) undertake any investigation not a part of its regular business
routine, (ii) disclose any information which, pursuant to accepted or reasonable
commercial finance practices, Lender wishes to maintain confidential or (iii)
make any other or future disclosures of any information to such
Guarantor.
Notwithstanding
any contrary provision of this Guaranty, it is intended that neither this
Guaranty nor any liens or security interests securing this Guaranty constitute
a
"Fraudulent Conveyance" (as defined below). Consequently, each Guarantor agrees
that, if this Guaranty or any liens or security interests securing this Guaranty
would, but for the application of this sentence, constitute a Fraudulent
Conveyance, this Guaranty and each such lien and security interest shall be
valid and enforceable only to the maximum extent that would not cause this
Guaranty or such lien or security interest to constitute a Fraudulent
Conveyance, and this Guaranty shall automatically be deemed to have been amended
accordingly at all relevant times. For purposes hereof, a "Fraudulent
Conveyance"
means a
fraudulent conveyance under Section 548 of the Bankruptcy Code or a fraudulent
conveyance or fraudulent transfer under any applicable fraudulent conveyance
or
fraudulent transfer law or similar law of any state or other governmental unit
as in effect from time to time or similar provision of any other applicable
insolvency law.
Each
Guarantor waives the right to assert the doctrine of marshaling with respect
to
any of the Collateral securing Borrower's Obligations. Each Guarantor further
agrees that, to the extent Borrower makes one or more payments to Lender, or
Lender receives any proceeds of Collateral, which are subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid
to
Borrower, its estate, trustee, receiver or any other party under the Bankruptcy
Code or other law, that portion of Borrower's Obligations which has been paid,
reduced or satisfied by such payment or proceeds shall be reinstated and
continued in full force and effect as of the date such initial payment,
reduction or satisfaction occurred, and this Guaranty shall continue to be
in
existence and in full force and effect, irrespective of whether any evidence
of
indebtedness or this Guaranty has been surrendered or canceled.
-3-
Each
Guarantor agrees that all payments hereunder shall be made without setoff or
counterclaims, and each Guarantor waives all presentments, demands for
performance, notices of nonperformance, protests, notices of protest, notices
of
dishonor and notices of acceptance of this Guaranty. Each Guarantor further
waives all notices of the existence, creation or incurring of new or additional
indebtedness, arising either from additional loans extended to Borrower or
otherwise, and also waives all notices that the principal amount, or any portion
thereof, or any interest on any instrument or document evidencing all or any
part of Borrower's Obligations is due, notices of any and all proceedings to
collect from the maker, any endorser or any other guarantor of all or any part
of Borrower's Obligations, or from anyone else, and, to the extent permitted
by
law, notices of exchange, sale, foreclosure, surrender or other handling of
any
Collateral securing Borrower's Obligations.
No
delay
on the part of Lender in the exercise of any right or remedy shall operate
as a
waiver thereof, and no single or partial exercise by Lender of any right or
remedy shall preclude any further exercise thereof except as expressly set
forth
in a writing duly signed and delivered on Lender's behalf by an authorized
officer or agent of Lender; nor shall any modification or waiver of any of
the
provisions of this Guaranty be binding upon Lender, except as expressly set
forth in a writing duly signed and delivered on Lender's behalf by an authorized
officer or agent of Lender. Lender's failure at any time or times hereafter
to
require strict performance by Borrower or any Guarantor of any of the
provisions, warranties, terms and conditions contained in any promissory note,
security agreement, agreement, guaranty, instrument or document now or at any
time or times hereafter executed by Borrower or any Guarantor and delivered
to
Lender, shall not waive, affect or diminish any right of Lender at any time
or
times hereafter to demand strict performance thereof, and such right shall
not
be deemed to have been waived by any act or knowledge of Lender, or its agents,
officers or employees, unless such waiver is contained in an instrument in
writing signed by an officer or agent of Lender, and directed to Borrower or
any
Guarantor, as applicable, specifying such waiver. No waiver by Lender of any
default shall operate as a waiver of any other default or the same default
on a
future occasion, and no action by Lender permitted hereunder shall in any way
affect or impair Lender's rights or the obligations of any Guarantor under
this
Guaranty. Any determination by a court of competent jurisdiction of the amount
of any principal or interest owing by Borrower to Lender shall be conclusive
and
binding on each Guarantor irrespective of whether such Guarantor was a party
to
the suit or action in which such determination was made.
Each
Guarantor hereby represents and warrants that (i) it is in such Guarantor's
direct interest to assist Borrower in procuring credit, because Borrower has
a
direct or indirect corporate or business relationship with Guarantor,
(ii) this Guaranty has been duly and validly authorized, executed and
delivered and constitutes the valid and binding obligation of such Guarantor,
enforceable in accordance with its terms, and (iii) the execution and
delivery of this Guaranty does not violate or constitute a default under (with
or without the giving of notice, the passage of time, or both) any order,
judgment, decree, instrument or agreement to which such Guarantor is a party
or
by which it or its assets are affected or bound.
-4-
All
payments to be made hereunder by each Guarantor shall be made free and clear
of
deduction for any present or future tax, levy, impost, duty, charge,
withholding, assessment or fee of any nature (including interest, penalties
and
additions thereto) that is imposed by any government or other taxing authority,
but excluding, (i) taxes imposed on or measured by Lender’s capital, net income
and franchise taxes or any other tax imposed on Lender for the privilege of
doing business, (ii) any taxes (other than withholding taxes) that would not
be
imposed but for a connection between Lender and the jurisdiction imposing such
taxes (other than a connection arising solely by virtue of the activities of
Lender pursuant to or in respect of this Guaranty or any other Loan Document),
(iii) any taxes imposed on Lender as a result of its voluntary transfer of
the
Loans or any interest therein, (iv) any taxes imposed on or measured by Lender's
assets, gross or net income, gross or net receipts, branch profits, capital
gains, excess profits, minimum taxes from tax preferences, alternative minimum
taxes or accumulated earnings taxes and (v) any taxes for which Lender is
actually reimbursed pursuant to any other provisions of this Guaranty (all
such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being collectively referred to herein as "Taxes").
If
any Taxes are imposed and required to be withheld from any payment hereunder,
each Guarantor shall (a) increase the amount of such payment so that Lender
will
receive a net amount (after deduction of all Taxes, including any Taxes on
the
amount of any such increase) equal to the amount due hereunder, (b) pay such
Taxes to the appropriate taxing authority for the account of Lender and (c)
as
promptly as possible thereafter, send Lender an original receipt showing payment
thereof, together with such additional documentary evidence as Lender may from
time to time reasonably require. If any Guarantor fails to perform its
obligations under parts (b) or (c) of the preceding sentence, each Guarantor
shall indemnify Lender for any incremental Taxes, interest or penalties that
may
become payable by Lender as a consequence of such failure.
This
Guaranty shall be binding upon each Guarantor and upon the successors and
permitted assigns of each Guarantor and shall inure to the benefit of Lender
and
its successors and assigns. All references herein to Borrower shall be deemed
to
include its successors and permitted assigns and all references herein to Lender
shall be deemed to include its successors and assigns. Borrower's and each
Guarantor's successors and permitted assigns shall include a receiver, trustee,
custodian of or for Borrower or such Guarantor or any of their respective assets
and Borrower or such Guarantor as debtor-in-possession. All references to the
singular shall be deemed to include the plural where the context so
requires.
EACH
GUARANTOR HEREBY CONSENTS AND AGREES THAT THE STATE AND FEDERAL COURTS IN NEW
YORK COUNTY, NEW YORK SHALL HAVE NONEXCLUSIVE JURISDICTION TO HEAR AND DETERMINE
ANY CLAIMS OR DISPUTES WITH RESPECT TO THIS GUARANTY AND WAIVES ANY OBJECTION
WHICH IT MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON CONVENIENS
TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND CONSENTS THAT ALL SERVICE
OF PROCESS UPON SUCH GUARANTOR BE MADE BY REGISTERED MAIL OR MESSENGER DIRECTED
TO SUCH GUARANTOR AT THE ADDRESS SET FORTH BELOW SUCH GUARANTOR'S SIGNATURE
AND
THAT SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT
THEREOF. EACH GUARANTOR HEREBY AGREES THAT ANY CLAIM OR DISPUTE BROUGHT BY
SUCH
GUARANTOR AGAINST LENDER OR ANY MATTER ARISING OUT OF THIS GUARANTY SHALL BE
BROUGHT EXCLUSIVELY IN THE STATE AND FEDERAL COURTS IN NEW YORK COUNTY, NEW
YORK. EACH GUARANTOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY LAW, TRIAL BY
JURY. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF LENDER TO SERVE LEGAL
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF LENDER
TO
BRING ANY ACTION OR PROCEEDING AGAINST GUARANTOR OR ITS PROPERTY IN THE COURTS
OF ANY OTHER JURISDICTION.
-5-
THIS
GUARANTY SHALL BE GOVERNED IN ALL RESPECTS BY THE INTERNAL LAWS OF THE STATE
OF
NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF
LAWS.
Wherever
possible each provision of this Guaranty shall be interpreted in such manner
as
to be effective and valid under applicable law, but if any provision of this
Guaranty shall be prohibited by or invalid under such law, such provision shall
be ineffective to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or the remaining provisions of
this
Guaranty.
Each
Guarantor hereby agrees that this Guaranty shall be deemed a "Loan Document"
as
defined in the Loan Agreement.
This
Guaranty may be executed in any number of counterparts, all of which shall
constitute one and the same instrument, and any party hereto may execute this
Guaranty by signing and delivering one or more counterparts.
-6-
IN
WITNESS WHEREOF, this Guaranty has been duly executed by the undersigned
Guarantors this 16th day of October, 2007.
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GUARANTORS:
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APPALACHIAN
OIL COMPANY,
a
Tennessee corporation
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| By | /s/ Xxxxx Chance | |
| Its |
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| Address | ||
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APPCO-KY,
INC.,
a
Tennessee corporation
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| By | /s/ Xxxxx Chance | |
| Its |
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| Address | ||
Signature
Page to Appco Guaranty of USAD Facility
