EXHIBIT 10.2
XXXXXXXXX FARMS, INC.
GUARANTY AGREEMENT
Xxxxxx X.X.
Chicago, Illinois
The Banks from time to time parties to the Credit Agreement (as hereinafter
defined)
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of November 17,
2005 (such Credit Agreement, as the same may be modified or amended from time to
time, being hereinafter referred to as the "Credit Agreement") by and among
Xxxxxxxxx Farms, Inc., a Mississippi corporation (the "Company"), and Xxxxxx
X.X., individually and in its capacity as agent thereunder, and the lenders from
time to time parties thereto (all of said lenders, including Xxxxxx X.X. in its
individual capacity, being referred to collectively as the "Banks" and
individually as a "Bank", and said Xxxxxx X.X. as agent for the Banks under the
Credit Agreement being hereinafter referred to in such capacity as the "Agent"),
pursuant to which said Banks agree to make available to the Company a Revolving
Credit, with all loans thereunder to be evidenced by the Revolving Notes of the
Company and pursuant to which Xxxxxx agrees to make available to the Company a
Swingline with all loans thereunder to be evidenced by the Swingline Note of the
Company (all such Revolving Notes and the Swingline Note being hereinafter
referred to collectively as the "Notes" and individually as a "Note"). In
addition the Company may request N.A. ("Xxxxxx") to issue letters of credit for
the Company's account and the other Banks will acquire risk participations in
such letters of credit and all obligations of the Company with request thereto
(the "Reimbursement Obligations"). All of the Company's indebtedness,
obligations and liabilities to the Banks under the Credit Agreement and the
other Loan Documents, including, without limitation, all such indebtedness,
obligations and liabilities evidenced by the Notes and the Reimbursement
Obligations, and all extensions or renewals of any of the foregoing, are
hereinafter collectively referred to as the "Indebtedness". All defined terms
used herein shall have the meanings set forth in the Credit Agreement unless
expressly defined herein.
The undersigned are wholly-owned subsidiaries of the Company. As an
inducement to each of you to accept and enter into said Credit Agreement, and in
consideration of credit extended and to be extended by the Banks to the Company
under said Credit Agreement, the undersigned (hereinafter collectively referred
to as the "Guarantors"), acknowledging that the Banks have informed the Company
that said credit would not be extended but for this guarantee, hereby jointly
and severally guarantee the full and prompt payment to the Agent and each of the
Banks at maturity (whether by acceleration, lapse of time or otherwise) and at
all times thereafter of principal of and interest on all Indebtedness of the
Company under the Credit Agreement, and all extensions or renewals of all or any
part thereof and all other indebtedness, liabilities and
obligations of the Company to the Banks and the Agent under the Credit
Agreement. Notwithstanding anything in this Guaranty to the contrary, the right
of recovery against each Guarantor under this Guaranty shall not exceed $1.00
less than the lowest amount which would render such Guarantor's obligations
under this Guaranty void or voidable under applicable law, including fraudulent
conveyance law.
The undersigned further jointly and severally acknowledge and agree with
the Banks that this Guaranty and the undertaking of the Guarantors in connection
therewith shall be on and subject to the following terms and conditions:
1. This Guaranty of payment by the Guarantors shall be a continuing,
absolute and unconditional guaranty and shall remain in full force and
effect until all Indebtedness of the Company to the Banks and the Agent
shall be fully paid and satisfied and all commitments of the Banks under
the Credit Agreement to extend credit to or for the account of the Company
shall have terminated. The dissolution, liquidation or insolvency
(howsoever evidenced) of, or the institution of bankruptcy or receivership
proceedings against any one or more of the Guarantors or the Company shall
not terminate this Guaranty.
2. The obligations and liabilities of the Guarantors, or any of them,
hereunder shall not be affected or impaired by any irregularity, invalidity
or unenforceability of or in any of the Notes or of any agreement,
instrument or other document evidencing or creating or providing for the
same.
3. The obligations and liabilities of the Guarantors, or any of them,
hereunder shall not be affected or impaired by (and the Banks are hereby
expressly authorized to make from time to time without notice to the
Guarantors) any sale, pledge, surrender, compromise, settlement, release,
renewal, extension, indulgence, amendment, alteration, substitution,
exchange, change in, modification or other disposition of any of the Credit
Agreement, the Notes, any other Loan Documents (as defined in the Credit
Agreement), any other guaranty thereof, or of any security or collateral
therefor.
4. The obligations and liabilities of the Guarantors or any of them
hereunder shall not be affected or impaired by any acceptance by the Agent
or the Banks, or any of them, of any security or collateral for, or other
guarantors upon any of the Indebtedness or by any failure, neglect,
omission, delay or partial action on the part of the Agent or the Banks, or
any of them, in the administration of the Indebtedness or to realize upon
or protect any of the Indebtedness or any security or collateral therefor,
or to exercise any lien upon or right of appropriation of any moneys,
credits or property of the Company possessed by any of the Banks toward the
liquidation of the Indebtedness or by any application of payments or
credits thereon or by any other circumstances whatsoever (with or without
notice to or the knowledge of the Guarantors, or any of them) which may in
any manner or to any extent vary the risk of the Guarantors, or any of
them, hereunder or may otherwise constitute a legal or equitable discharge
of a surety or guarantor; it being the purpose and intent that this
guaranty of payment and the obligations and liability of the Guarantors
hereunder shall be absolute and unconditional
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under any and all circumstances and shall not be discharged except by
payment and performance as herein provided.
5. In order to hold the Guarantors, or any of them, liable hereunder,
there shall be no obligation on the part of any Bank, at any time, to
resort for payment to any person directly liable in respect of the
Indebtedness or to any other guaranty, or to any other person, their
properties or estates, or to resort to any collateral, security, property,
liens or other rights or remedies whatsoever, and the Banks shall have the
right to enforce this guaranty of payment irrespective of whether or not
other proceedings or steps are pending seeking resort to or realization
upon or from any of the foregoing. The Guarantors jointly and severally
agree to pay all reasonable out-of-pocket expenses, including court costs
and reasonable attorneys' fees, paid or incurred by the Agent and the Banks
or any of them in endeavoring to collect on the Indebtedness or any part
thereof and in enforcing this Guaranty.
6. The granting of credit to the Company by any Bank from time to time
in addition to the Indebtedness under the Credit Agreement without notice
to the Guarantors, or any of them, is hereby authorized and shall in no way
affect or impair the obligations and liability of the Guarantors, or any of
them, hereunder.
7. The payment by any Guarantor of any amount or amounts under this
guaranty of payment shall not entitle it, either at law, in equity or
otherwise, to any right, title or interest (whether by way of subrogation
or otherwise) in and to any of the Indebtedness, or in and to any security
or collateral therefor, or in or to any amounts at any time paid or payable
under or pursuant to any guaranty by any other person of all or part of
Indebtedness, or in and to any amounts theretofore, then or thereafter paid
or applicable to the payment of the Indebtedness, howsoever such payment or
payments may arise, until all of the Indebtedness has been fully paid and
all obligations of the Banks to extend credit to or for the benefit of the
Company shall have terminated or expired.
8. This Guaranty Agreement may be enforced by the Banks acting
jointly, or it may be enforced by any Bank acting alone or separately with
respect to the Indebtedness which it holds. Any Bank may, without any
notice to the Guarantors, sell, assign or transfer, to the extent permitted
in the Credit Agreement, the Indebtedness held by it, or any part thereof,
or grant participations therein; and in that event, each and every
immediate and successive assignee, transferee or holder of or participant
in all or any part of the Indebtedness shall, to the extent permitted in
the Credit Agreement, have the right to enforce this Guaranty, by suit or
otherwise, for the benefit of such assignee, transferee, holder or
participant as fully as if such assignee, transferee, holder or participant
were herein by name specifically given such rights, powers and benefits;
but each Bank shall have an unimpaired right to enforce this Guaranty
Agreement for its own benefit or for the benefit of any such participant as
to so much of the Indebtedness that it has not sold, assigned or
transferred.
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9. If any payment applied by any Bank to any of the Indebtedness 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 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 as
fully as if such application had never been made.
10. This Guaranty Agreement shall be construed according to the
internal laws of the state of Illinois, in which State it shall be
performed by the Guarantors. This Guaranty Agreement and every part hereof
shall be binding upon the Guarantors jointly and severally and upon their
respective legal representatives, successors and assigns of each and all of
the undersigned, and shall inure to the benefit of the Banks and their
respective successors, legal representatives and assigns.
11. This writing is intended by the parties to be a complete and final
expression of this Guaranty Agreement and is also intended as a complete
and exclusive statement of the terms of that agreement. No course of
dealing, course of performance or trade usage, and no parole evidence of
any nature, shall be used to supplement or modify any terms hereof, nor are
there any conditions to the full effectiveness of this Guaranty Agreement.
12. EACH GUARANTOR AND, BY THEIR ACCEPTANCE OF THIS GUARANTY, THE
AGENT AND EACH BANK HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATIVE TO THIS GUARANTY OR
THE TRANSACTIONS CONTEMPLATED HEREBY.
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Dated as of this 17th day of November, 2005.
XXXXXXXXX FARMS, INC. (FOODS DIVISION)
ATTEST:
/s/ Xxxxx X. Xxxxxx By /s/ D. Xxxxxxx Xxxxxxxx
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Its Treasurer and Chief Financial Officer
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XXXXXXXXX FARMS, INC. (PRODUCTION
DIVISION)
ATTEST:
/s/ Xxxxx X. Xxxxxx By /s/ D. Xxxxxxx Xxxxxxxx
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Its Treasurer and Chief Financial Officer
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XXXXXXXXX FARMS, INC. (PROCESSING
DIVISION)
ATTEST:
/s/ Xxxxx X. Xxxxxx By /s/ D. Xxxxxxx Xxxxxxxx
----------------------------------- -------------------------------------
Its Treasurer and Chief Financial Officer
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