EXHIBIT 10.7.2
FORM OF
GUARANTY
(Seller Hersant Guaranty)
This GUARANTY (this "Guaranty"), dated as of _________, 1996, is
executed and delivered by XXXX GRAPHIC SYSTEMS, INC., a Delaware corporation
("Guarantor"), with reference to the following facts:
R E C I T A L S
WHEREAS, in connection with the sale of the stock and/or assets of
the Rockwell Graphic Systems business unit ("RGS") of Rockwell International
Corporation, a Delaware corporation ("Rockwell"), to Guarantor, Guarantor wishes
to effect a sale of a portfolio of loans of RGS, and associated instruments,
agreements, documents and collateral, all as more particularly described below,
arising from the sale of printing and like equipment in the conduct of RGS'
business.
WHEREAS, Guarantor desires to sell and BT Commercial Corporation, a
Delaware corporation ("BTCC"), desires to purchase such loans and certain other
related assets of Guarantor pursuant to the terms of that certain Loan Portfolio
Purchase Agreement, dated as of even date herewith (the "Purchase Agreement").
WHEREAS, as a condition precedent to BTCC's entering into the
Purchase Agreement, BTCC has required under Section 9.14 of the Purchase
Agreement that Guarantor execute this Guaranty in favor of BTCC.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing, Guarantor hereby
agrees, in favor of BTCC, as follows:
1. Definitions and Construction.
(a) Definitions. All initially capitalized terms used but not
defined herein shall have the meanings assigned to such terms in the Purchase
Agreement. In addition, the following terms, as used in this Guaranty, shall
have the following meanings:
"Bankruptcy Code" means The Bankruptcy Reform Act of
1978 (11 U.S.C. Sections 101 et seq.), as amended or supplemented from time to
time, and any successor statute, and any and all rules issued or promulgated in
connection therewith.
"Guaranteed Obligations" has the meaning set forth in
Section 3 hereof.
"Obligors" means any and all Hersant Affiliates which
are obligors with respect to the Hersant Loans.
"Purchase Documents" means the Purchase Agreement, this
Guaranty, and the other agreements, documents and instruments executed in
connection therewith.
(b) Construction. Unless the context of this Guaranty
clearly requires otherwise, references to the plural include the singular,
references to the singular include the plural, and the term "including" is not
limiting. The words "hereof," "herein," "hereby," "hereunder," and other similar
terms refer to this Guaranty as a whole and not to any particular provision of
this Guaranty. Any reference herein to any of the Purchase Documents includes
any and all alterations, amendments, extensions, modifications, renewals, or
supplements thereto or thereof, as applicable. Neither this Guaranty nor any
uncertainty or ambiguity herein shall be construed or resolved against BTCC or
Guarantor, whether under any rule of construction or otherwise. On the contrary,
this Guaranty has been reviewed by Guarantor, BTCC, and their respective
counsel, and shall be construed and interpreted according to the ordinary
meaning of the words used so as to fairly accomplish the purposes and intentions
of BTCC and Guarantor.
2. Guaranteed Obligations. Subject to the conditions and limitations
contained in Section 4 hereof, Guarantor hereby irrevocably and unconditionally
guarantees to BTCC, as and for Guarantor's own debt, until final and
indefeasible payment thereof has been made, payment of the Guaranteed
Obligations.
3. Limited Guaranty. "Guaranteed Obligations" means the aggregate
principal balance of the Hersant Loans outstanding from time to time in an
amount up to but not exceeding Ten Million Five Hundred Thousand Dollars
($10,500,000). Guarantor's liability with respect to this Guaranty shall be
reduced, dollar-for dollar, by the amount of all reductions of the aggregate
principal balance of the Hersant Loans below Ten Million Five Hundred Thousand
Dollars ($10,500,000).
4. Payment and Performance Under This Guaranty.
(a) BTCC may demand payment hereunder of the maximum amount
of Guaranteed Obligations and, promptly after receipt of such demand, Guarantor
shall make such payment, if:
(i) any Obligor defaults in respect of the payment in
full of two (2) consecutive regularly scheduled quarterly payments due under the
terms of the applicable Hersant Loan and BTCC notifies Guarantor in writing of
the first such default within thirty (30) days thereof; or
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(ii) BTCC notifies Guarantor in writing that an Obligor
has defaulted on a regularly scheduled semi-annual payment due under the terms
of the applicable Hersant Loan and such payment default continues uncured for
sixty (60) days after Guarantor's receipt of such notice.
(b) In the event that no demand on, or enforcement of, or
payment under this Guaranty occurs and BTCC is paid in full by the Obligors with
respect to the Guaranteed Obligations, then this Guaranty shall terminate and
BTCC shall pay Guarantor the sum of One Million Dollars ($1,000,000) within five
(5) business days of BTCC's receipt of such payment in full.
(c) Not later than five (5) days after BTCC's receipt of
payment in full of all amounts outstanding in respect of the Hersant Loans
(including, without limitation, principal, interest, fees and expenses), BTCC
shall promptly pay Guarantor the amount, if any, by which (a) the sum of (i)
principal payments made in respect of the Hersant Loans and (ii) amounts, if
any, paid by the Guarantor on this Guaranty exceeds (b) the aggregate principal
amount of the Hersant Loans outstanding on the date of the Closing.
5. Primary Obligations. This Guaranty is a primary and original
obligation of Guarantor, is not merely the creation of a surety relationship,
and is an absolute, unconditional, and continuing guaranty of payment and
performance which shall remain in full force and effect without respect to
future changes in conditions, including any change of law or any invalidity or
irregularity with respect to the Purchase Documents or with respect to the
Guaranteed Obligations. Guarantor agrees that Guarantor is jointly and severally
liable, with any other guarantor of the Guaranteed Obligations, to BTCC, to the
extent and subject to the limitations set forth in Sections 3 and 4 hereof, that
the obligations of Guarantor hereunder are independent of the obligations of the
Obligors or any other guarantor, and that a separate action may be brought
against Guarantor to enforce this Guaranty whether an action is brought against
the Obligors or any other guarantor or whether the Obligors or any such other
guarantor are joined in such action. Guarantor agrees that, subject to the terms
and conditions of Sections 3 and 4 hereof, Guarantor's liability hereunder shall
be immediate and shall not be contingent upon the exercise or enforcement by
BTCC of whatever remedies it may have against the Obligors or any other
guarantor, or the enforcement of any lien or realization upon any security BTCC
may at any time possess. Guarantor agrees that any release which may be given by
BTCC to any other guarantor shall not release Guarantor. Guarantor consents and
agrees that BTCC shall be under no obligation to marshal any assets of the
Obligors or any other guarantor in favor of Guarantor, or against or in payment
of any or all of the Guaranteed Obligations.
6. Waivers.
(a) Guarantor absolutely, unconditionally, knowingly, and
expressly waives:
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(i) (1) notice of acceptance hereof; (2) notice of the
amount of the Guaranteed Obligations, subject, however, to Guarantor's right to
make inquiry of BTCC to ascertain the amount of the Guaranteed Obligations at
any reasonable time; (3) notice of any adverse change in the financial condition
of the Obligors or of any other fact that might increase Guarantor's risk
hereunder; (4) notice of any event giving rise to a claim of indemnification
under the Purchase Documents; and (5) all other notices (except if such notice
is specifically required to be given to Guarantor hereunder or under the
Purchase Documents) and demands to which Guarantor might otherwise be entitled.
(ii) its right, under Sections 2845 or 2850 of the
California Civil Code, or otherwise, to require BTCC to institute suit against,
or to exhaust any rights and remedies which BTCC has or may have against, the
Obligors or any third party, or against any collateral for the Guaranteed
Obligations provided by the Obligors or any third party. In this regard,
Guarantor agrees that Guarantor is bound to the payment of all Guaranteed
Obligations, whether now existing or hereafter accruing, as fully as if such
Guaranteed Obligations were directly owing to BTCC by Guarantor. Guarantor
further waives any defense arising by reason of any disability or other defense
(other than the defense that the Guaranteed Obligations shall have been fully
and finally performed and indefeasibly paid) of the Obligors or by reason of the
cessation from any cause whatsoever of the liability of the Obligors in respect
thereof.
(iii) (1) any rights to assert against BTCC any defense
(legal or equitable), set-off, counterclaim, or claim which Guarantor may now or
at any time hereafter have against the Obligors or any other party liable to
BTCC; (2) any defense, set-off, counterclaim, or claim, of any kind or nature,
arising directly or indirectly from the present or future lack of perfection,
sufficiency, validity, or enforceability of the Guaranteed Obligations or any
security therefor; (3) any defense Guarantor has to performance hereunder, and
any right Guarantor has to be exonerated, provided by Sections 2819, 2822, or
2825 of the California Civil Code, or otherwise, arising by reason of: the
impairment or suspension of BTCC's rights or remedies against the Obligors; the
alteration by BTCC of the Guaranteed Obligations; any discharge of the Obligors'
obligations to BTCC by operation of law as a result of BTCC's intervention or
omission; or the acceptance by BTCC of anything in partial satisfaction of the
Guaranteed Obligations; (4) the benefit of any statute of limitations affecting
Guarantor's liability hereunder or the enforcement thereof, and any act which
shall defer or delay the operation of any statute of limitations applicable to
the Guaranteed Obligations shall similarly operate to defer or delay the
operation of such statute of limitations applicable to Guarantor's liability
hereunder.
(b) Guarantor absolutely, unconditionally, knowingly, and
expressly waives any defense arising by reason of or deriving from any election
by BTCC under Bankruptcy Code Section 1111(b) to limit the amount of, or any
collateral securing, its claim against the Obligors.
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(c) Until BTCC has received full and final payment of all
amounts outstanding in respect of the Hersant Loans (including, without
limitation, principal, interest, fees and expenses), Guarantor hereby
absolutely, unconditionally, knowingly, and expressly agrees that it shall not
exercise: (i) any right of subrogation Guarantor has or may have as against the
Obligors with respect to the Guaranteed Obligations; (ii) any right to proceed
against the Obligors or any other person or entity, now or hereafter, for
contribution, indemnity, reimbursement, or any other suretyship rights and
claims, whether direct or indirect, liquidated or contingent, whether arising
under express or implied contract or by operation of law, which Guarantor may
now have or hereafter have as against the Obligors with respect to the
Guaranteed Obligations; and (iii) any right to proceed or seek recourse against
or with respect to any property or asset of the Obligors.
(d) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR
OTHER PROVISION SET FORTH IN THIS GUARANTY, GUARANTOR HEREBY ABSOLUTELY,
KNOWINGLY, UNCONDITIONALLY, AND EXPRESSLY WAIVES AND AGREES NOT TO ASSERT ANY
AND ALL BENEFITS OR DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER ANY ONE OR
MORE OF CALIFORNIA CIVIL CODE SECTIONS 2799, 2808, 2809, 2810, 2815, 2819, 2820,
2821, 2822, 2825, 2839, 2845, 2848, 2849, AND 2850, AND CHAPTER 2 OF TITLE 14 OF
THE CALIFORNIA CIVIL CODE.
7. Obligations Unconditional. Guarantor consents and agrees that,
without notice to or by Guarantor, and without affecting or impairing the
obligations of Guarantor hereunder, BTCC may, by action or inaction:
(a) compromise, settle, extend the duration or the time for
the payment of, or discharge the performance of, or may
refuse to or otherwise not enforce this Guaranty, the
other Purchase Documents, the Purchased Assets, or any
part thereof, with respect to the Obligors or any other
Person;
(b) grant other indulgences to the Obligors or any other
Person in respect of the Guaranteed Obligations;
(c) amend or modify in any manner and at any time (or from
time to time) any of the Purchase Documents or the
Purchased Assets with respect to the Obligors; or
(d) release or substitute any other guarantor, if any, of the
Guaranteed Obligations, or enforce, exchange, release, or
waive any security for the Guaranteed Obligations or any
other guaranty of the Guaranteed Obligations, or any
portion thereof.
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8. No Election. BTCC shall have all of the rights to seek recourse
against Guarantor to the fullest extent provided for herein, and no election by
BTCC to proceed in one form of action or proceeding, or against any party, or on
any obligation, shall constitute a waiver of BTCC's right to proceed in any
other form of action or proceeding or against other parties unless BTCC has
expressly waived such right in writing. Specifically, but without limiting the
generality of the foregoing, no action or proceeding by BTCC under any document
or instrument evidencing the Guaranteed Obligations shall serve to diminish the
liability of Guarantor under this Guaranty except to the extent that BTCC
finally and unconditionally shall have realized indefeasible payment by such
action or proceeding.
9. Term; Indefeasible Payment. Except as otherwise expressly
provided herein (including, without limitation, as set forth in Section 4
hereof), this Guaranty shall remain in effect until the full and indefeasible
payment of the Guaranteed Obligations. The Guaranteed Obligations shall not be
considered indefeasibly paid for purposes of this Guaranty unless and until all
payments to BTCC in respect of the Guaranteed Obligations are no longer subject
to any right on the part of any Person, including the Obligors, any Obligor as a
debtor in possession, or any trustee (whether appointed under the Bankruptcy
Code or otherwise) of any of the Obligors' assets, to invalidate or set aside
such payments or to seek to recoup the amount of such payments or any portion
thereof, or to declare same to be fraudulent or preferential. In the event that,
for any reason, any portion of such payments to BTCC is set aside or restored,
whether voluntarily or involuntarily, after the making thereof, then the
Guaranteed Obligation intended to be satisfied thereby shall be revived and
continued in full force and effect as if said payment or payments had not been
made, and, subject to the limitations set forth in Sections 3 and 4 hereof,
Guarantor shall be liable for the full amount BTCC is required to repay in
respect thereof.
10. Financial Condition of the Obligors. Guarantor represents and
warrants to BTCC that Guarantor is currently informed of the financial condition
of the Obligors and of all other circumstances which a diligent inquiry would
reveal and which bear upon the risk of nonpayment of the Guaranteed Obligations.
Guarantor hereby covenants that Guarantor will continue to keep informed of the
Obligors' financial condition, the financial condition of other guarantors, if
any, and of all other circumstances which bear upon the risk of nonpayment or
nonperformance of the Guaranteed Obligations.
11. Subordination. Guarantor hereby agrees that any and all present
and future indebtedness of the Obligors owing to Guarantor is postponed in favor
of and subordinated to payment, in full, in cash, of the Guaranteed Obligations.
In this regard, no payment of any kind whatsoever shall be made with respect to
such indebtedness until the Guaranteed Obligations have been indefeasibly paid
in full.
12. Payments; Application. All payments to be made hereunder by the
parties shall be made in lawful money of the United States of America at the
time of payment, shall be made in immediately available funds, and shall be made
without deduction (whether
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for taxes or otherwise) or offset. Except as otherwise expressly provided
herein, all payments made by Guarantor hereunder shall be applied as follows:
first, to all reasonable costs and expenses (including reasonable attorneys'
fees and expenses and reasonable attorneys' fees and expenses incurred pursuant
to proceedings in respect of Guarantor arising under the Bankruptcy Code)
incurred by BTCC in enforcing this Guaranty; and second, to the Guaranteed
Obligations.
13. Attorneys' Fees and Costs. Guarantor agrees to pay, on demand,
all reasonable attorneys' fees (including reasonable attorneys' fees incurred
pursuant to proceedings respecting Guarantor arising under the Bankruptcy Code)
and all other reasonable costs and expenses which may be incurred by BTCC in the
enforcement of this Guaranty.
14. Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including facsimile transmission or similar
writing), shall be sent by certified or registered mail, return receipt
requested, or by overnight delivery service, with all charges prepaid, and shall
be given to such party at its address or facsimile number set forth below
(promptly confirmed in writing sent by first class mail), or such other address
or telecopier number as such party may hereafter specify for the purpose by
notice to the other party:
If to Guarantor: Xxxx Graphic Systems, Inc.
c/o Stonington Partners, Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xx. Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxxxx, Esq.
Fax: (000) 000-0000
If to BTCC: BT Commercial Corporation
000 X. Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xx. Xxxxxx Xxxxxxxx
Fax: (000) 000-0000
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with a copy to:
Buchalter, Nemer, Fields & Younger
000 X. Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxx, Esq.
Fax: (000) 000-0000
Each such notice, request or other communication shall be effective upon
receipt; provided that any notice, request, or other communication given in
connection with BTCC's exercise of any of its rights or remedies hereunder, and
as to which there exists applicable statutory or common law governing such
notice, request or other communication, shall be effective in accordance with
such applicable statutory law irrespective of when received by Guarantor.
15. Cumulative Remedies. Except as otherwise expressly provided, no
remedy under this Guaranty or under any Purchase Document is intended to be
exclusive of any other remedy, but each and every remedy shall be cumulative and
in addition to any and every other remedy given hereunder or under any Purchase
Document, and those provided by law or in equity. No delay or omission by BTCC
to exercise any right under this Guaranty shall impair any such right nor be
construed to be a waiver thereof. No failure on the part of BTCC to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.
16. Books and Records. Guarantor agrees BTCC's books and records
showing the account between BTCC and the Obligors shall be admissible in any
action or proceeding and shall be prima facie proof for the purpose of
establishing the items therein set forth.
17. Severability of Provisions. If any provision of this Guaranty is
for any reason held to be invalid, illegal or unenforceable in any respect, that
provision shall not affect the validity, legality or enforceability of any other
provision of this Guaranty.
18. Entire Agreement; Amendments and Waivers. This Guaranty,
together with the other Purchase Documents, constitutes the entire agreement
between Guarantor and BTCC pertaining to the subject matter contained herein.
Any provision of this Guaranty may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the party asserted to be
bound thereby, and then such amendment or waiver shall be effective only in the
specific instance and specific purpose for which given.
19. Successors and Assigns. This Guaranty shall bind the successors
and assigns of Guarantor, and shall inure to the benefit of the respective
successors and assigns of BTCC; provided, however, Guarantor may not assign this
Guaranty or delegate any of its
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duties hereunder without BTCC's prior written consent, which may be withheld for
any reason, and any such prohibited assignment shall be absolutely null and
void. BTCC reserves its right to sell, assign, transfer, negotiate, or grant
participations in all or any part of, or any interest in, the rights and
benefits hereunder pursuant to and in accordance with the provisions of the
Purchase Documents. In connection therewith, BTCC may disclose all documents and
information which BTCC now or hereafter may have relating to Guarantor,
Guarantor's business, or this Guaranty to any such prospective or actual
transferee.
20. Governing Law; Jurisdiction; Jury Trial.
(a) GOVERNING LAW. THIS GUARANTY SHALL BE DEEMED TO HAVE BEEN
MADE IN THE STATE OF CALIFORNIA AND THE VALIDITY, CONSTRUCTION, INTERPRETATION,
AND ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO, SHALL BE
DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW.
(b) JURISDICTION AND VENUE. THE PARTIES HERETO AGREE THAT ANY
ACTION OR PROCEEDING PURSUANT TO OR ARISING IN CONNECTION WITH THIS GUARANTY,
WHETHER SOUNDING IN CONTRACT,
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TORT, EQUITY OR OTHERWISE, SHALL BE HELD ONLY IN THE CITY AND COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA.
(c) JURY TRIAL. THE PARTIES HERETO EACH HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY; ANY DISPUTES WILL BE RESOLVED BY A BENCH TRIAL.
IN WITNESS WHEREOF, Guarantor has executed and delivered this
Guaranty as of the date set forth in the first paragraph hereof.
XXXX GRAPHIC SYSTEMS, INC.,
a Delaware corporation
By:_________________________________________
Title:______________________________________
ACCEPTED AND AGREED:
BT COMMERCIAL CORPORATION,
a Delaware corporation
By___________________________
Title________________________
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