Exhibit 10.6
GUARANTY
THIS GUARANTY, dated as of October 15, 2002 (this "GUARANTY") by and among
Golfsmith International, Inc., Golfsmith International Holdings, Inc., Golfsmith
GP Holdings, Inc., Golfsmith Holdings, L.P., Golfsmith GP, L.L.C., Golfsmith
Delaware, L.L.C., Golfsmith Canada, L.L.C., Golfsmith Europe, L.L.C., and
Golfsmith Licensing, L.L.C., (referred to herein individually as "GUARANTOR" and
collectively as "GUARANTORS"), and GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation, as Agent (in such capacity, "AGENT") for itself and the
lenders from time to time party to the Credit Agreement as defined below
("LENDERS").
WHEREAS:
(A) WHEREAS, pursuant to that certain Credit Agreement dated as of the date
hereof by and among Golfsmith International, Inc., Golfsmith International
Holdings, Inc., Golfsmith GP Holdings, Inc., Golfsmith Holdings, L.P.,
Golfsmith International, L.P. ("L.P."), Golfsmith GP, L.L.C., Golfsmith
Delaware, L.L.C., Golfsmith Canada, L.L.C., Golfsmith Europe, L.L.C.,
Golfsmith USA, L.L.C. ("USA"), Golfsmith NU, L.L.C. ("NU"), and Golfsmith
Licensing, L.L.C., each as a Credit Party (with L.P., NU and USA as
Borrowers), Agent and Lenders (including all annexes, exhibits and
schedules thereto, and as from time to time amended, restated,
supplemented or otherwise modified, the "CREDIT AGREEMENT") the Lenders
have agreed to make available to Borrowers, upon terms and conditions
thereof, the Revolving Loans and Letters of Credit provided for in the
Credit Agreement;
(B) Borrowers wish to borrow certain Loans and cause certain Letters of Credit
to be issued;
(C) Each of the Guarantors will benefit from the making of the Loans and the
Letter of Credit Obligations as provided for in the Credit Agreement, and
have agreed to guarantee payment of the Obligations.
NOW, THEREFORE, in consideration of the premises and the covenants hereinafter
contained, and to induce Lenders to make the Loans and to incur the Letter of
Credit Obligations to be made and incurred by Lenders under the Credit
Agreement, it is agreed as follows:
1. DEFINITIONS
Capitalized terms used herein shall have the meanings assigned to them in
the Credit Agreement and Annex A thereto, unless otherwise defined herein.
References to this "GUARANTY" shall mean this Guaranty, including all
amendments, modifications and supplements and any annexes, exhibits and
schedules to any of the foregoing, and shall refer to this Guaranty as the
same may be in effect at the time such reference becomes operative.
2. THE GUARANTY
2.1 Guaranty of Guaranteed Obligations
Each Guarantor, jointly and severally, hereby absolutely, unconditionally
and irrevocably guarantees to Agent for the ratable benefit of the Lenders
and their respective successors, endorsees, transferees and assigns, the
prompt payment (whether at stated maturity, by
acceleration or otherwise) and performance of the Obligations
(collectively, the "GUARANTEED OBLIGATIONS"). Each Guarantor agrees that
this Guaranty is a guaranty of payment and performance and not of
collection, and that its obligations under this Guaranty shall be primary,
absolute and unconditional, irrespective of, and unaffected by:
(a) the genuineness, validity, regularity, enforceability or any future
amendment of, or change in, this Guaranty, any other Loan Document
or any other agreement, document or instrument to which any Credit
Party and/or Guarantor is or may become a party;
(b) the absence of any action to enforce this Guaranty or any other Loan
Document or the waiver or consent by Agent and/or Lenders with
respect to any of the provisions thereof;
(c) the existence, value or condition of, or failure to perfect Agent's
Lien against, any Collateral for the Guaranteed Obligations or any
action, or the absence of any action, by Agent in respect thereof
(including, without limitation, the release of any such security);
(d) the insolvency of any Credit Party; or
(e) any other action or circumstances which might otherwise constitute a
legal or equitable discharge or defense of a surety or guarantor,
it being agreed by each Guarantor that its obligations under this Guaranty
shall not be discharged until the Termination Date. Each Guarantor shall
be regarded, and shall be in the same position, as principal debtor with
respect to the Guaranteed Obligations. Each Guarantor agrees that any
notice or directive given at any time to Agent which is inconsistent with
the waiver in the immediately preceding sentence shall be null and void
and may be ignored by Agent and Lenders and, in addition, may not be
pleaded or introduced as evidence in any litigation relating to this
Guaranty for the reason that such pleading or introduction would be at
variance with the written terms of this Guaranty, unless Agent and Lenders
have specifically agreed otherwise in writing. It is agreed among
Guarantors, Agent and Lenders that the foregoing waivers are of the
essence of the transaction contemplated by the Loan Documents and that,
but for this Guaranty and such waivers, Agent and Lenders would decline to
enter into the Credit Agreement.
2.2 Demand by Agent or Lenders
In addition to the terms of the Guaranty set forth in Section 2.1 hereof,
and in no manner imposing any limitation on such terms, it is expressly
understood and agreed that, if, at any time, the outstanding principal
amount of the Guaranteed Obligations under the Credit Agreement (including
all accrued interest thereon) is declared to be immediately due and
payable, then each Guarantor shall, jointly and severally, without demand,
pay to the holders of the Guaranteed Obligations the entire outstanding
Guaranteed Obligations due and owing to such holders. Payment by the
Guarantors shall be made to Agent in immediately available funds to an
account, designated by Agent or at the address set forth herein for the
giving of notice to Agent or at any other address that may be specified in
writing from time to time by Agent, and shall be credited and applied to
the Guaranteed Obligations.
2.3 Enforcement of Guaranty
In no event shall Agent have any obligation (although it is entitled, at
its option) to proceed against any Borrower or any other Credit Party or
any Collateral pledged to secure Guaranteed Obligations before seeking
satisfaction from any Guarantor, and Agent may proceed, prior or
subsequent to, or simultaneously with, the enforcement of Agent's rights
hereunder, to exercise
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any right or remedy which it may have against any Collateral, as a result
of any Lien it may have as security for all or any portion of the
Guaranteed Obligations.
2.4 Waiver
In addition to the waivers contained in Section 2.1 hereof, each Guarantor
waives and agrees that it shall not at any time insist upon, plead or in
any manner whatsoever claim or take the benefit or advantage of, any
appraisal, valuation, stay, extension, marshaling of assets or redemption
laws, or exemption, whether now or at any time hereafter in force, which
may delay, prevent or otherwise affect the performance by such Guarantor
of its Guaranteed Obligations under, or the enforcement by Agent or
Lenders of, this Guaranty. Each Guarantor hereby waives diligence,
presentment and demand (whether for non-payment or protest or of
acceptance, maturity, extension of time, change in nature or form of the
Guaranteed Obligations, acceptance of further security, release of further
security, composition or agreement arrived at as to the amount of, or the
terms of, the Guaranteed Obligations, notice of adverse change in any
Borrower's financial condition or any other fact which might increase the
risk to such Guarantor) with respect to any of the Guaranteed Obligations
or all other demands whatsoever and, to the fullest extent permitted by
law, waives the benefit of all provisions of law which are or might be in
conflict with the terms of this Guaranty. Each Guarantor represents,
warrants and agrees that, as of the date of this Guaranty, its obligations
under this Guaranty are not subject to any offsets or defenses against
Agent or Lenders or any Credit Party of any kind. Each Guarantor further
agrees that its obligations under this Guaranty shall not be subject to
any counterclaims, offsets or defenses against Agent or any Lender or
against any Credit Party of any kind which may arise in the future.
2.5 Benefit of Guaranty
The provisions of this Guaranty are for the benefit of Agent and Lenders
and their respective successors, transferees, endorsees and assigns, and
nothing herein contained shall impair, as between any Credit Party and
Agent or Lenders, the obligations of any Credit Party under the Loan
Documents. In the event all or any part of the Guaranteed Obligations are
transferred, indorsed or assigned by Agent or any Lender to any Person or
Persons, any reference to "AGENT" or "LENDER" herein shall be deemed to
refer equally to such Person or Persons.
2.6 Modification of Guaranteed Obligations, Etc.
Each Guarantor hereby acknowledges and agrees that Agent and Lenders may
at any time or from time to time, with or without the consent of, or
notice to such Guarantor:
(a) change or extend the manner, place or terms of payment of, or renew
or alter all or any portion of, the Guaranteed Obligations;
(b) take any action under or in respect of the Loan Documents in the
exercise of any remedy, power or privilege contained therein or
available to it at law, equity or otherwise, or waive or refrain
from exercising any such remedies, powers or privileges;
(c) amend or modify, in any manner whatsoever, the Loan Documents;
(d) extend or waive the time for any Credit Party's performance of, or
compliance with, any term, covenant or agreement on its part to be
performed or observed under the Loan Documents, or waive such
performance or compliance or consent to a failure of, or departure
from, such performance or compliance;
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(e) take and hold Collateral for the payment of the Guaranteed
Obligations guaranteed hereby or sell, exchange, release, dispose
of, or otherwise deal with, any property pledged, mortgaged or
conveyed, or in which Agent or Lenders have been granted a Lien, to
secure any Obligations;
(f) release anyone who may be liable in any manner for the payment of
any amounts owed by any Guarantor or any Credit Party to Agent or
any Lender;
(g) modify or terminate the terms of any intercreditor or subordination
agreement pursuant to which claims of other creditors of any
Guarantor or any Credit Party are subordinated to the claims of
Agent and Lenders; and/or
(h) apply any sums by whomever paid or however realized to any amounts
owing by any Guarantor or any Credit Party to Agent or any Lender in
such manner as Agent or any Lender shall determine in its
discretion,
and Agent and Lenders shall not incur any liability to any Guarantor as a
result thereof, and no such action shall impair or release the Guaranteed
Obligations of any Guarantor under this Guaranty.
2.7 Reinstatement
This Guaranty shall remain in full force and effect and continue to be
effective should any petition be filed by or against any Credit Party or
any Guarantor for liquidation or reorganization, should any Credit Party
or any Guarantor become insolvent or make an assignment for the benefit of
creditors or should a receiver or trustee be appointed for all or any
significant part of such Credit Party's or Guarantor's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any
time payment and performance of the Guaranteed Obligations, or any part
thereof, is, pursuant to applicable law, rescinded or reduced in amount,
or must otherwise be restored or returned by Agent or any Lender, whether
as a "voidable preference", "fraudulent conveyance", or otherwise, all as
though such payment or performance had not been made. In the event that
any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Guaranteed Obligations shall be reinstated and deemed
reduced only by such amount paid and not so rescinded, reduced, restored
or returned.
2.8 Deferral of Subrogation, Etc.
Notwithstanding anything to the contrary in this Guaranty, or in any other
Loan Document, each Guarantor hereby:
(a) expressly and irrevocably waives, on behalf of itself and its
successors and assigns (including any surety) until the Termination
Date, any and all rights at law or in equity to subrogation, to
reimbursement, to exoneration, to contribution, to indemnification,
to set off or to any other rights that could accrue to a surety
against a principal, to any Guarantor against a principal, to any
Guarantor against a maker or obligor, to an accommodation party
against the party accommodated, to a holder or transferee against a
maker, or to the holder of any claim against any Person, and which
any Guarantor may have or hereafter acquire against any Credit Party
in connection with or as a result of Guarantor's execution, delivery
and/or performance of this Guaranty, or any other documents to which
any Guarantor is a party or otherwise; and
(b) acknowledges and agrees that this waiver is intended to benefit
Agent and Lenders and shall not limit or otherwise effect any
Guarantor's liability hereunder or the enforceability
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of this Guaranty, and that Agent, Lenders and their respective
successors and assigns are intended third party beneficiaries of the
waivers and agreements set forth in this Section 2.8 and their
rights under this Section 2.8 shall survive payment in full of the
Guaranteed Obligations.
2.9 Election of Remedies
If Agent may, under applicable law, proceed to realize benefits under any
of the Loan Documents giving Agent or Lenders a Lien upon any Collateral
owned by any Credit Party, either by judicial foreclosure or by
non-judicial sale or enforcement, Agent may, at its sole option, determine
which of such remedies or rights it may pursue without affecting any of
such rights and remedies under this Guaranty. If, in the exercise of any
of its rights and remedies, Agent shall forfeit any of its rights or
remedies, including its right to enter a deficiency judgment against any
Credit Party, whether because of any applicable laws pertaining to
"election of remedies" or the like, each Guarantor hereby consents to such
action by Agent and waives any claim based upon such action, even if such
action by Agent shall result in a full or partial loss of any rights of
subrogation which any Guarantor might otherwise have had but for such
action by Agent. Any election of remedies which results in the denial or
impairment of the right of Agent to seek a deficiency judgment against any
Credit Party shall not impair any Guarantor's obligation to pay the full
amount of the Guaranteed Obligations. In the event Agent shall bid at any
foreclosure or trustee's sale or at any private sale permitted by law or
the Loan Documents, Agent may bid all or less than the amount of the
Guaranteed Obligations and the amount of such bid need not be paid by
Agent but shall be credited against the Guaranteed Obligations. The amount
of the successful bid at any such sale shall be conclusively deemed to be
the fair market value of the collateral and the difference between such
bid amount and the remaining balance of the Guaranteed Obligations shall
be conclusively deemed to be the amount of the Guaranteed Obligations
guaranteed under this Guaranty, notwithstanding that any present or future
law or court decision or ruling may have the effect of reducing the amount
of any deficiency claim to which Agent and Lenders might otherwise be
entitled but for such bidding at any such sale.
3. DELIVERIES
In a form satisfactory to Agent, each Guarantor shall deliver to Agent
(with sufficient copies for each Lender), concurrently with the execution
of this Guaranty and the Credit Agreement, the Loan Documents and other
instruments, certificates and documents as are required to be delivered by
such Guarantor to Agent under the Credit Agreement, to the extent not
otherwise delivered thereunder.
4. REPRESENTATIONS AND WARRANTIES
To induce Lenders to make the Loans and incur Letter of Credit Obligations
under the Credit Agreement, each Guarantor makes the representations and
warranties as to such Guarantor contained in the Credit Agreement, each of
which is incorporated herein by reference, and all of which shall be
deemed to be made on the date of each borrowing by any Borrower under the
Credit Agreement on and as of the date of such borrowing as though made
hereunder on and as of such date.
5. FURTHER ASSURANCES
Each Guarantor agrees, upon the written request of Agent or any Lender, to
execute and deliver to Agent or such Lender, from time to time, any
additional instruments or documents reasonably considered necessary by
Agent or such Lender to cause this Guaranty to be, become or remain valid
and effective in accordance with its terms.
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6. PAYMENTS FREE AND CLEAR OF TAXES
All payments required to be made by any Guarantor hereunder shall be made
to Agent and Lenders free and clear of, and without deduction for, any and
all present and future Taxes. If any Guarantor shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder, the sum
payable shall be increased as much as shall be necessary so that after
making all required deductions (including deductions applicable to
additional sums payable under this Section 6) Agent or Lenders, as
applicable, receive an amount equal to the sum they would have received
had no such deductions been made, such Guarantor shall make such
deductions and such Guarantor shall pay the full amount deducted to the
relevant taxing or other authority in accordance with applicable law.
Within thirty (30) days after the date of any payment of Taxes, such
Guarantor shall furnish to Agent the original or a certified copy of a
receipt evidencing payment thereof. Such Guarantor shall indemnify and,
within ten (10) days of written demand therefor, pay Agent and each Lender
for the full amount of Taxes (including any Taxes imposed by any
jurisdiction on amounts payable under this Section 6) paid by Agent or
such Lender, as appropriate with respect to payments required to be made
by such Guarantor, and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such
Taxes were correctly or legally asserted and (d) within 30 days after the
written request of Guarantor, each Lender or Agent shall, at the cost of
such Guarantor, execute and deliver to Guarantor such information,
certificates or forms as are reasonably requested by such Guarantor in
such request, which can be furnished consistent with the facts and which
are necessary to assist such Guarantor in applying for refunds of Taxes
paid (or reimbursed pursuant to Section 6) by such Guarantor hereunder
provided always that no Lender or Agent shall be obliged to execute and
deliver any information, certificates or forms regarding any part of its
business or affairs that it considers to be confidential. If a Lender or
Agent receives a refund of any Taxes with respect to which any Guarantor
has made a payment hereunder or otherwise, such Lender or Agent shall pay
to such Guarantor an amount that such Lender or Agent determines in good
faith to be equal to the net benefit, after tax, that was obtained by such
Lender or Agent (as the case may be) as a consequence of such refund.
7. OTHER TERMS
7.1 Entire Agreement
This Guaranty, the Credit Agreement, the Notes and the other Loan
Documents embody the entire agreement among the parties hereto and
supersede all prior commitments, agreements, representations, and
understandings, whether oral or written, relating to the subject matter
hereof, and may not be contradicted or varied by evidence of prior,
contemporaneous, or subsequent oral agreements or discussions of the
parties hereto.
7.2 Headings
Section and subsection headings are included herein for convenience of
reference only and shall not constitute a part of this Guaranty for any
other purposes or be given substantive effect.
7.3 Severability
The invalidity, illegality, or unenforceability in any jurisdiction of any
provision of this Guaranty shall not affect or impair the remaining
provisions of this Guaranty.
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7.4 Notices
Any notice or other communication required shall be in writing addressed
to the respective party as set forth below and may be personally served,
telecopied, sent by overnight courier service or U.S. mail and shall be
deemed to have been given: (a) if delivered in person, when delivered; (b)
if delivered by fax, on the date of transmission if transmitted on a
Business Day before 4:00 p.m. New York Time; (c) if delivered by overnight
courier, one (1) Business Day after delivery to the courier properly
addressed; or (d) if delivered by U.S. mail, four (4) Business Days after
deposit with postage prepaid and properly addressed.
Notices shall be addressed as follows:
(a) If to Agent, at:
General Electric Capital Corporation
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Golfsmith Account Manager
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
with copies to:
General Electric Capital Corporation
Capital Funding, Inc.
000 Xxxx Xxxxx, Xxxxxxxx X, Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Counsel
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
and:
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000-0000
Attention: Corporate Counsel
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
and:
Xxxxxxxx Chance US LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
(b) If to any Lender, at the address of such Lender specified in the
Credit Agreement;
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(c) If to Guarantor at:
c/o Golfsmith International, Inc.
00000 Xxxxx XX 00
Xxxxxx, Xxxxx 00000-0000
Attention: Chief Financial Officer
Telephone No.: (000) 000-0000
Telecopier No.: (000) 000-0000
with a copy to:
First Atlantic Capital, Ltd.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx
Fax: (000) 000-0000
7.5 Successors and Assigns
This Guaranty and all obligations of each Guarantor hereunder shall be
binding upon the successors and assigns of such Guarantor (including a
debtor-in-possession on behalf of such Guarantor) and shall, together with
the rights and remedies of Agent, for itself and for the benefit of
Lenders, hereunder, inure to the benefit of Agent and Lenders, all future
holders of any instrument evidencing any of the Obligations and their
respective successors and assigns. No sales of participations, other
sales, assignments, transfers or other dispositions of any agreement
governing or instrument evidencing the Obligations or any portion thereof
or interest therein shall in any manner affect the rights of Agent and
Lenders hereunder. No Guarantor may assign, sell, hypothecate or otherwise
transfer any interest in or obligation under this Guaranty.
7.6 No Waiver; Cumulative Remedies; Amendments
Neither Agent nor any Lender shall by any act, delay, omission or
otherwise be deemed to have waived any of its rights or remedies
hereunder, and no waiver shall be valid unless in writing, signed by Agent
and then only to the extent therein set forth. A waiver by Agent, for
itself and the ratable benefit of Lenders, of any right or remedy
hereunder on any one occasion shall not be construed as a bar to any right
or remedy which Agent would otherwise have had on any future occasion. No
failure to exercise nor any delay in exercising, on the part of Agent or
any Lender, any right, power or privilege hereunder, shall operate as a
waiver thereof, nor shall any single or partial exercise of any right,
power or privilege hereunder preclude any other or future exercise thereof
or the exercise of any other right, power or privilege. The rights and
remedies hereunder provided are cumulative and may be exercised singly or
concurrently, and are not exclusive of any rights and remedies provided by
law. None of the terms or provisions of this Guaranty may be waived,
altered, modified, supplemented or amended except by an instrument in
writing, duly executed by Agent and each Guarantor.
7.7 Termination
This Guaranty is a continuing guaranty and shall remain in full force and
effect until the payment and performance in full of the Guaranteed
Obligations. Upon payment and performance in full of the Guaranteed
Obligations, Agent shall deliver to each Guarantor such documents as such
Guarantor may reasonably request to evidence such termination.
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7.8 Counterparts; Effectiveness
This Guaranty and any amendments, waivers, consents or supplements may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall
be deemed an original, but all of which counterparts together shall
constitute but one in the same instrument. This Guaranty shall become
effective upon the execution of a counterpart hereof by each of the
parties hereto.
7.9 Consent to Jurisdiction
GUARANTORS HEREBY CONSENT TO THE JURISDICTION OF ANY STATE OR FEDERAL
COURT LOCATED WITHIN NEW YORK COUNTY, STATE OF NEW YORK AND IRREVOCABLY
AGREE THAT, SUBJECT TO AGENT'S ELECTION, ALL ACTIONS OR PROCEEDINGS
ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OF THE OTHER LOAN
DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. GUARANTORS EXPRESSLY SUBMIT
AND CONSENT TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVE ANY
DEFENSE OF FORUM NON CONVENIENS. GUARANTORS HEREBY WAIVE PERSONAL SERVICE
OF ANY AND ALL PROCESS AND AGREE THAT ALL SUCH SERVICE OF PROCESS MAY BE
MADE UPON ANY GUARANTORS BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, ADDRESSED TO SUCH GUARANTOR, AT THE ADDRESS SET FORTH IN THIS
GUARANTY AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS AFTER THE
SAME HAS BEEN POSTED. IN ANY LITIGATION, TRIAL, ARBITRATION OR OTHER
DISPUTE RESOLUTION PROCEEDING RELATING TO THIS GUARANTY OR ANY OF THE
OTHER LOAN DOCUMENTS, ALL DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS OF
GUARANTORS OR ANY OF THEIR AFFILIATES SHALL BE DEEMED TO BE EMPLOYEES OR
MANAGING AGENTS OF SUCH GUARANTORS FOR PURPOSES OF ALL APPLICABLE LAW OR
COURT RULES REGARDING THE PRODUCTION OF WITNESSES BY NOTICE FOR TESTIMONY
(WHETHER IN A DEPOSITION, AT TRIAL OR OTHERWISE). GUARANTORS AGREE THAT
AGENT'S OR ANY LENDER'S COUNSEL IN ANY SUCH DISPUTE RESOLUTION PROCEEDING
MAY EXAMINE ANY OF THESE INDIVIDUALS AS IF UNDER CROSS-EXAMINATION AND
THAT ANY DISCOVERY DEPOSITION OF ANY OF THEM MAY BE USED IN THAT
PROCEEDING AS IF IT WERE AN EVIDENCE DEPOSITION. GUARANTORS IN ANY EVENT
WILL USE ALL COMMERCIALLY REASONABLE EFFORTS TO PRODUCE IN ANY SUCH
DISPUTE RESOLUTION PROCEEDING, AT THE TIME AND IN THE MANNER REQUESTED BY
AGENT OR ANY LENDER, ALL PERSONS, DOCUMENTS (WHETHER IN TANGIBLE,
ELECTRONIC OR OTHER FORM) OR OTHER THINGS UNDER THEIR CONTROL AND RELATING
TO THE DISPUTE.
7.10 Waiver of Jury Trial
GUARANTORS HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY AND
THE OTHER LOAN DOCUMENTS. GUARANTORS ACKNOWLEDGE THAT THIS WAIVER IS A
MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS
RELIED ON THE WAIVER IN ENTERING INTO THIS GUARANTY AND THE OTHER LOAN
DOCUMENTS AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR
RELATED FUTURE DEALINGS. GUARANTORS WARRANT AND REPRESENT THAT EACH HAS
HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND
THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.
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7.11 Limitation
Notwithstanding any provision herein contained to the contrary, the
liability of each of Golfsmith GP. L.L.C., Golfsmith Delaware, L.L.C.,
Golfsmith Canada, L.L.C., Golfsmith Europe, L.L.C. and Golfsmith Licensing
L.L.C. (each, a "Limited Guarantor") under this Guaranty shall be limited
to an amount not to exceed as of any date of determination the greater of:
(a) the net amount of all Loans advanced to such Limited Guarantor under
the Credit Agreement and then re-loaned or otherwise transferred to,
or for the benefit of, such Limited Guarantor; and
(b) the amount that could be claimed by Agent and Lenders from such
Limited Guarantor under this Guaranty without rendering such claim
voidable or avoidable under Section 548 of Chapter 11 of the
Bankruptcy Code or under any applicable state Uniform Fraudulent
Transfer Act, Uniform Fraudulent Conveyance Act or similar statute
or common law after taking into account, among other things, such
Limited Guarantor's right of contribution and indemnification from
each other Guarantor under Section 7.12.
7.12 Contribution with Respect to Guaranty Obligations
(a) To the extent that any Guarantor shall make a payment under this
Guaranty of all or any of the Obligations (a "Guarantor Payment")
that, taking into account all other Guarantor Payments then
previously or concurrently made by any other Guarantor, exceeds the
amount that such Guarantor would otherwise have paid if each
Guarantor had paid the aggregate Obligations satisfied by such
Guarantor Payment in the same proportion that such Guarantor's
"Allocable Amount" (as defined below) (as determined immediately
prior to such Guarantor Payment) bore to the aggregate Allocable
Amounts of each of the Guarantors as determined immediately prior to
the making of such Guarantor Payment, then, following indefeasible
payment in full in cash of the Obligations and termination of the
Commitments, such Guarantor shall be entitled to receive
contribution and indemnification payments from, and be reimbursed
by, each other Guarantor for the amount of such excess, pro rata
based upon their respective Allocable Amounts in effect immediately
prior to such Guarantor Payment.
(b) As of any date of determination, the "Allocable Amount" of any
Guarantor shall be equal to the maximum amount of the claim that
could then be recovered from such Guarantor under this Section 7.12
without rendering such claim voidable or avoidable under Section 548
of Chapter 11 of the Bankruptcy Code or under any applicable state
Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act
or similar statute or common law.
(c) This Section 7.12 is intended only to define the relative rights of
Guarantors and nothing set forth in this Section 7.12 is intended to
or shall impair the obligations of Guarantors, jointly and
severally, to pay any amounts as and when the same shall become due
and payable in accordance with the terms of this Guaranty. Nothing
contained in this Section 7.12 shall limit the liability of any
Guarantor to pay the Loans made directly or indirectly to that
Guarantor and accrued interest, Fees and expenses with respect
thereto for which such Guarantor shall be primarily liable.
(d) The parties hereto acknowledge that the rights of contribution and
indemnification hereunder shall constitute assets of the Guarantor
to which such contribution and indemnification is owing.
10
(e) The rights of the indemnifying Guarantors against other Credit
Parties under this Section 7.12 shall be exercisable upon the full
and indefeasible payment of the Obligations and the termination of
the Commitments.
7.13 Liability Cumulative
The liability of Guarantors under this Section 7.11 and 7.12 is in
addition to and shall be cumulative with all liabilities of each Guarantor
under this Guaranty to which such Guarantor is a party or in respect of
any Obligations or obligation of the other Guarantor, without any
limitation as to amount, unless the instrument or agreement evidencing or
creating such other liability specifically provides to the contrary.
11
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Guaranty as of the date first above written.
GOLFSMITH INTERNATIONAL, INC.
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH INTERNATIONAL HOLDINGS, INC.
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH GP HOLDINGS, INC.
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH HOLDINGS, L.P.
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH GP, L.L.C.
By Golfsmith Holdings, L.P., as Sole Member
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH DELAWARE, L.L.C.
By Golfsmith Holdings, L.P., as Sole Member
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
SIGNATURE PAGE TO GOLFSMITH GUARANTY
Xxxx X. Xxxxxx
Vice President
GOLFSMITH CANADA, L.L.C.
By Golfsmith Holdings, L.P., as Sole Member
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH EUROPE, L.L.C.
By Golfsmith Holdings, L.P., as Sole Member
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GOLFSMITH LICENSING, L.L.C.
By Golfsmith Holdings, L.P., as Sole Member
By Golfsmith GP Holdings, Inc., as General
Partner
By /s/ XXXX X. XXXXXX
-----------------------------------------
Xxxx X. Xxxxxx
Vice President
GENERAL ELECTRIC CAPITAL CORPORATION,
AS AGENT
By: /s/ LAURENT PARIS
---------------------------------------
Name: Laurent Paris
-----------------------------
its Duly Authorized Signatory
SIGNATURE PAGE TO GOLFSMITH GUARANTY
