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EXHIBIT 10.10
SECOND AMENDED AND RESTATED
GUARANTY AGREEMENT
This Second Amended and Restated Guaranty Agreement (this
"Guaranty"), is entered into as of March 30, 2000 by and among Marketing
Specialists Sales Company, Bromar, Inc., and Xxxx Xxxxx Associates, Inc. (each
individually a "Guarantor" and individually and collectively the "Guarantors"),
in favor of First Union National Bank, a national banking association, for
itself and as agent ("Agent") for the lenders (together with such additional
financial institutions as may become Lenders from time to time as provided in
the Credit Agreement described below "Lenders").
BACKGROUND
1. Marketing Specialists Corporation ("Borrower") has entered into that
certain Second Amended and Restated Credit Agreement dated the date hereof (as
may be amended from time to time, the "Credit Agreement") among the Borrower,
the Lenders and the Agent.
2. As a condition to Agent's and Lenders' willingness to enter into the
Credit Agreement, the Guarantors are willing to execute and deliver to Agent, as
agent for the Lenders, this Guaranty.
3. The Borrower, certain of the Guarantors and the Agent are parties to
that certain Amended and Restated Guaranty Agreement dated August 18, 1999 (the
"Existing Guaranty").
4. The parties desire to amend the Existing Guaranty and the Guarantors
signatory hereto desire to become party to the Guaranty as set forth herein.
5. Each Guarantor is a Subsidiary of the Borrower, and each Guarantor's
directors have determined that it is in the best interest of such Guarantor to
execute this Guaranty and that such Guarantor will benefit directly and
indirectly from the execution of this Guaranty.
6. This Guaranty amends and restates in its entirety the Existing
Guaranty; provided, however, that this Guaranty shall not constitute a novation
and nothing herein shall be deemed to have terminated or discharged any
indebtedness or obligation under the Existing Guaranty, all of which shall
remain outstanding under and be governed by this Guaranty.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
each Guarantor and the Agent hereby agree as follows:
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1. Definitions and Construction. Reference is made to the Credit
Agreement for a statement of the terms thereof. All terms used in this Guaranty
which are defined in the Credit Agreement and not defined herein shall have the
respective meanings ascribed to such terms in the Credit Agreement.
2. Guaranty. Each Guarantor, jointly and severally, absolutely and
unconditionally, guarantees and becomes surety for the full, prompt and punctual
payment to Lenders, as and when due, whether at maturity, by acceleration or
otherwise, of any and all Indebtedness, and performance of any and all
liabilities and obligations of Borrower to Agent and Lenders or any of them
(including, without limitation, reimbursement obligations under Letters of
Credit) created at any time under, or pursuant to, the terms of the Credit
Agreement and the other Loan Documents, whether for principal, interest,
premiums, fees, expenses or otherwise, any obligations under interest rate
protection agreements, swaps, hedging contracts or similar arrangements with any
Lender (including, without limitation, any swap agreement as defined in 11
U.S.C. Section 101), and any obligations under or pursuant to any other
documents and agreements executed in connection with any of the foregoing,
including any future advances, whether obligatory or voluntary, or refinancings,
renewals or extensions of or substitutions for, any existing or future debt
(collectively, all such Indebtedness, liabilities and obligations are referred
to herein as the "Obligations"), together with any and all reasonable expenses
(including, without limitation, attorneys' fees, disbursements and the costs and
expenses of in-house counsel and legal support staff) which may be incurred by
the Agent and any Lender in collecting any or all of the Obligations or
enforcing any and all rights against any Guarantor under this Guaranty (the
"Expenses"). Without limiting any Guarantor's obligations hereunder and
notwithstanding any purported termination of this Guaranty, if any bankruptcy,
insolvency, reorganization, arrangement, readjustment, composition, liquidation,
dissolution, assignment for the benefit of creditors, or similar event with
respect to the Borrower or any endorser of all or any of the Obligations shall
occur, and such occurrence shall result in the return of (or in such event the
Agent or any Lender shall be requested to return) any payment or performance of
any of the Obligations or Expenses, then (a) without further notice, demand or
other action, the obligations of each Guarantor hereunder shall be reinstated
with respect to (i) such payment or performance returned (or requested to be
returned) and (ii) with respect to all further obligations arising as a result
of such return or request, and (b) each Guarantor shall thereupon be liable
therefor, without any obligation on the part of the Agent or any Lender to
contest or resist any such return. If a party ceases to be a Lender, then any
obligations under interest rate protection agreements, swaps, hedging contracts
or similar arrangements(including without limitation, any swap agreement as
defined in 11 U.S.C. Section 101), with that party prior to the date it ceases
to be a Lender shall continue to be Obligations guaranteed hereunder.
3. Nature and Term of Guaranty.
(1) The obligations and liability of each Guarantor under this
Guaranty shall be joint and several, absolute, primary and direct, irrevocable
and unconditional, regardless of any non-perfection of any collateral security
for the Obligations; any lack of validity or
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enforceability of the Credit Agreement, any other Loan Document or any of the
Obligations or Expenses; the voluntary or involuntary liquidation, dissolution,
sale or other disposition of all, or substantially all of the assets,
marshalling of assets and liabilities, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition with creditors or readjustment of, or other similar proceedings
affecting Borrower, any Guarantor or any other guarantor or endorser of, any or
all of the Obligations and Expenses or any of the assets of any of them, or any
contest of the validity of this Guaranty in any such proceeding; or any law,
regulation or decree now or hereafter in effect in any jurisdiction which might
in any manner affect any of such terms or provisions or any of the rights of the
Agent or any Lender with respect thereto or which might cause or permit the
Borrower, any Guarantor or any guarantor or endorser of the Obligations and
Expenses to invoke any defense to, or any alteration in the time, amount or
manner of payment of any or all of the Obligations and Expenses or performance
of this Guaranty.
(2) This Guaranty is a continuing guaranty and shall remain in full
force and effect until: (i) the Obligations, Expenses and any and all other
amounts payable hereunder shall have been paid in full in cash; (ii) no further
loans or advances are available; (iii) no Letters of Credit are outstanding
under the Credit Agreement; and (iv) and the period during which any payment by
the Borrower or either Guarantor is or may be subject to rescission, avoidance
or refund under the United States Bankruptcy Code (or any similar state or
federal statute) shall have expired.
4. Limitation on Amount Guarantied. Anything contained in this Guaranty
to the contrary notwithstanding, the obligations of each Guarantor hereunder
shall be limited to the lesser of (i) the aggregate amount of the Obligations
and Expenses, or (ii) a maximum aggregate amount equal to the largest amount
that would not render its obligations hereunder subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the United
States Code or any applicable provisions of comparable state law (collectively,
the "Fraudulent Transfer Laws"), if and to the extent each Guarantor (or a
trustee on its behalf) has properly invoked the protections of the Fraudulent
Transfer Laws, in each case after giving effect to all other liabilities of such
Guarantor, contingent or otherwise, that are relevant under the Fraudulent
Transfer Laws.
5. Payment in Accordance with Notes and Credit Agreement.
(1) Each Guarantor hereby guaranties that the Obligations and
Expenses shall be paid and performed strictly in accordance with the terms of
the Loan Documents.
(b) If any Obligation or Expense is not paid or performed by the
Borrower punctually, subject to any applicable grace period, including without
limitation any Obligation due by acceleration of the maturity thereof, the
Guarantors will, upon Agent's demand (at the direction of Required Lenders),
immediately pay or perform such Obligation or
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Expense or cause the same to be paid or performed. Guarantors will pay to Agent
and each Lender, upon demand, all costs and expenses, including the Expenses,
which may be incurred by the Agent or such Lender in the collection or
enforcement of any Guarantor's obligations under this Guaranty.
6. Defaults; Rights and Remedies of Lenders.
(1) An event of default hereunder shall include each of the
following:
(i) an Event of Default as defined under any of the Loan
Documents;
(ii) any Guarantor's failure to perform any of its
obligations or duties under this Guaranty; and
(iii) any Guarantor's notice to any Lender or Agent that such
Guarantor does not intend to be liable for any future Obligations or Expenses or
contests the validity or enforceability of this Guaranty.
(2) Agent, on behalf of Lenders, in their sole discretion, may
proceed to exercise any right or remedy which they may have under this Guaranty
(in accordance with the Credit Agreement) against any Guarantor without first
pursuing or exhausting any rights or remedies which they may have against the
Borrower or against any other person or entity or any collateral security, and
may proceed to exercise any right or remedy which they may have under this
Guaranty (in accordance with the Credit Agreement) without regard to any actions
or omissions of any other person or entity, in any manner or order, without any
obligation to marshal in favor of any Guarantor or other persons or entities and
without releasing any of Guarantors' obligations hereunder with respect to any
unpaid Obligations and Expenses. Upon the occurrence and continuance of an Event
of Default, each Guarantor shall immediately pay, comply with and perform such
of the Obligations and Expenses as Agent, on behalf of Lenders, shall direct,
irrespective of whether the Obligations and Expenses to be paid, complied with
and performed by such Guarantor are those which gave rise to the Event of
Default. No remedy herein conferred upon or reserved to the Agent is intended to
be exclusive of any other available remedy or remedies, but each and every such
remedy shall be cumulative and shall be in addition to every other remedy given
under this Guaranty or now or hereafter existing at law or in equity.
(3) If Borrower or any other person or entity defaults under the
Loan Documents and any Lender is prevented from accelerating payment thereunder,
either by operation of any bankruptcy laws, similar laws or any court order,
such Lender shall be entitled to receive from the Guarantors, upon demand by
Agent on behalf of such Lender (in accordance with the Credit Agreement), the
sums which would have otherwise been due and payable had such acceleration
occurred.
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7. Actions by Lenders Not Affecting Guaranty. Lenders may, at any time
or from time to time, in such manner and upon such terms as they may deem
proper, extend or change the time of payment or the manner or place of payment
of, or otherwise modify or waive any of the terms of, or release, exchange,
settle or compromise any or all of the Obligations and Expenses or any
collateral security therefor, or subordinate payment of the same, or any part
thereof, to the payment of any other indebtedness, liabilities or obligations of
the Borrower which may at any time be due or owing to the Lenders or anyone, or
elect not to enforce any of the Lenders' rights with respect to any or all of
the Obligations and Expenses or any collateral security therefor, all without
notice to, or further assent of any Guarantor and without releasing or affecting
any Guarantor's obligations hereunder.
8. Payments Under Guaranty. All payments by Guarantors hereunder shall
be made in immediately available funds and in lawful money of the United States
of America to the Agent at the office of the Agent referred to in Paragraph 2.11
of the Credit Agreement or at such other location as the Agent shall specify by
notice to the Guarantors. All payments by any Guarantor under this Guaranty
shall be made by such Guarantor solely from such Guarantor's own funds and not
from any funds of the Borrower.
9. Modifications and Waivers. No failure or delay on the part of any
Lender or Agent in exercising any power or right under this Guaranty shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power preclude any other or further exercise thereof or the
exercise of any other right or power under this Guaranty. No modification or
waiver of any provision of this Guaranty nor consent to any departure therefrom
shall, in any event, be effective unless the same is in writing signed by the
Lenders (or Required Lenders to the extent applicable under the Credit
Agreement) and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. No notice to, or demand
on any Guarantor, in any case, shall entitle such Guarantor to any other or
further notice or demand in similar or other circumstances.
10. Guarantors' Waiver. Each Guarantor hereby waives the following:
(1) promptness, diligence, presentment, demand, notice of acceptance
and any other notice with respect to any of the Obligations and Expenses or this
Guaranty, except for such notice as may be expressly required under the Loan
Documents;
(2) any defense or circumstance which might otherwise constitute a
legal or equitable discharge of any Guarantor, including, without limitation,
any obligation of any Lender to proceed against Borrower prior to exercising any
rights hereunder;
(3) any and all right to terminate such Guarantor's obligations and
duties hereunder by delivery or written notice to any Lender or otherwise;
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(4) all benefits under any present or future laws exempting any
property, real or personal, or any part of any proceeds thereof, from
attachment, levy or sale under execution, or providing for any stay of execution
to be issued on any judgment recovered under any of the Loan Documents or in any
replevin or foreclosure proceedings, or otherwise providing for any valuation,
appraisal or exemption;
(5) all rights to inquisition on any real estate, which real estate
may be levied upon pursuant to a judgment obtained under any of the Loan
Documents and sold upon any writ of execution issued thereon in whole or in
part, in any order desired by any Lender;
(6) any requirement for bonds, security or sureties required by any
statute, court rule or otherwise; and
(7) any and all procedural errors, defects and imperfections in any
action by Agent or Lenders in replevin, foreclosure or other court process or in
connection with any other action related to any of the Loan Documents or the
transactions contemplated therein.
11. Subordination; Subrogation. Each Guarantor hereby expressly agrees
that it shall not exercise, against Borrower or any other Guarantor, or other
guarantor, maker, endorser or Person, and: (a) right which such Guarantor may
now have or hereafter acquire by way of subrogation under this Guaranty, by law
or otherwise or by way of reimbursement, indemnity, exoneration, or
contribution; (b) right to assert defenses as the primary obligor of the
Obligations; (c) other claim which it now has or may hereafter acquire against
Borrower or any other Person or against or with respect to Borrower's property
(including, without limitation, any property which has been pledged to secure
the Obligations); or (d) right to enforce any remedy which any Lender may now
have or hereafter acquire against Borrower or any other Guarantor, or any other
guarantor, maker, endorser or Person; in any case, whether any of the foregoing
claims, remedies and rights may arise in equity, under contract, by payment,
statute, common law or otherwise until all Obligations and Expenses have been
indefeasibly paid in full in cash. If in violation of the foregoing any amount
shall be paid to any Guarantor on account of any such rights at any time, such
amount shall be held in trust for the benefit of the Lenders and shall forthwith
be paid to the Agent, for the benefit of the Lenders, to be credited and applied
against the Obligations and Expenses, whether matured or unmatured, in
accordance with the terms of the Notes and the Credit Agreement.
12. No Setoff by Guarantors. No setoff, counterclaim, deduction,
reduction, or diminution of any obligation, or any defense of any kind or nature
which any Guarantor has or may have against Borrower or any Lender shall be
available hereunder to any Guarantor.
13. Representations and Warranties. Each Guarantor hereby represents
and warrants that the representations and warranties set forth in Section 3 of
the Credit Agreement are true and correct in all respects including as applied
to Guarantors.
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14. Covenants. Each Guarantor covenants and agrees that, so long as the
Guaranty shall remain in effect, they shall comply in all respects with the
covenants and agreements set forth in the Credit Agreement to the extent such
covenants apply to them, including without limitation, the covenants and
agreements set forth in Sections 5 and 6 thereof.
15. Addresses for Notices. All requests, consents, notices and other
communications required or permitted hereunder or in connection herewith shall
be deemed satisfactorily given if in writing and delivered personally or by
registered or certified mail, postage pre-paid, by reliable overnight courier,
or by telecopier to the parties at their respective addresses set forth below or
at such other address as may be given by any party to the other in writing in
accordance with this Section 15:
If to Borrower or any Guarantor:
c/o Marketing Specialists Corporation
00000 Xxxxxx Xxxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telecopier: (000) 000-0000
If to Agent:
First Union National Bank
0000 Xxxxxxxx Xxxxxx
XX 4843
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Telecopier: (000) 000-0000
16. Continuing Guaranty; Transfer of Notes. This Guaranty is a
continuing guaranty and shall (i) remain in full force and effect until the
Obligations, Expenses and any and all other amounts payable under this Guaranty
shall have been paid in full and the period during which any payment made by
Borrower or any Guarantor is or may be subject to avoidance or refund under the
United States Bankruptcy Code (or any similar statute) shall have expired, (ii)
be binding upon each Guarantor and their respective successors and assigns, and
(iii) inure to the benefit of, and be enforceable by the Lenders and Agent and
their respective successors, transferees and assigns in accordance with
Paragraph 9.2 of the Credit Agreement. Without limiting (iii) above, the Lenders
may endorse, assign or otherwise transfer the Obligations to any other person or
entity in accordance with the provisions of the Credit Agreement, and such other
person or entity shall thereupon become vested with all the rights in respect
thereof granted to the Lenders herein or otherwise.
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17. Entire Agreement. This Guaranty constitutes the entire agreement,
and supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
18. Severability.
(1) The invalidity or unenforceability of any one or more portions
of this Guaranty shall not affect the validity or enforceability of the
remaining portions of this Guaranty.
(2) Each Guarantor, the Agent and each Lender agree that in an
action or proceeding involving any state or federal bankruptcy, insolvency or
other law affecting the rights of creditors generally:
(1) If any clause or provision shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction and shall not in any manner affect such clause or provision in
any other jurisdiction, or any other clause or provision in this Guaranty in any
jurisdiction, or any other clause or provision in this Guaranty in any
jurisdiction.
(2) If the guaranty hereunder by any Guarantor would be held or
determined to be void, invalid or unenforceable on account of the amount of its
aggregate liability under this Guaranty, then, notwithstanding any other
provision of this Guaranty to the contrary, the aggregate amount of such
liability shall, without any further action by any Guarantor, the Agent or any
Lender or any other person, be automatically limited and reduced to the highest
amount which is valid and enforceable as determined in action or proceeding.
(3) If any other guaranty by any one or more other i.e.
guarantor is held or determined to be void, invalid or unenforceable, in whole
or in part, such holding or determination shall not impair or affect:
(1) the validity and enforceability of the guaranty
hereunder by any Guarantor, which shall continue in full force and effect in
accordance with its terms; or
(2) the validity and enforceability of any clause or
provision not so held to be void, invalid or unenforceable.
19. Counterparts. This Guaranty may be executed by Guarantors in
several separate counterparts, each of which shall be an original and all of
which taken together shall constitute one and the same instrument.
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20. Governing Law. This Guaranty shall be deemed to be a contract under
the laws of the Commonwealth of Pennsylvania and for all purposes shall be
governed by and construed in accordance with such laws.
21. Consent to Jurisdiction and Service of Process. Each Guarantor
irrevocably appoints each officer of Borrower and every other Guarantor as its
attorney upon whom may be served any notice, process or pleading in any action
or proceeding against it arising out of or in connection with this Guaranty, the
Loan Documents or any of the Collateral; each Guarantor hereby consents that any
action or proceeding against it be commenced and maintained in any court within
the Commonwealth of Pennsylvania or in the United States District Court for the
Eastern District of Pennsylvania by service of process on any officer of
Borrower or any Guarantor; and each Guarantor agrees that the courts of the
Commonwealth of Pennsylvania and the United States District Court for the
Eastern District of Pennsylvania shall have jurisdiction with respect to the
subject matter hereof and the person of such Guarantor and the Collateral.
Notwithstanding the foregoing, Agent, in its absolute discretion, may also
initiate proceedings in the courts of any other jurisdiction in which any
Guarantor may be found or in which any of its properties or Collateral may be
located.
22. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS GUARANTY OR OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF AGENT OR
LENDERS. THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDERS' ENTERING INTO THIS
AGREEMENT.
23. ACKNOWLEDGMENTS. EACH GUARANTOR ACKNOWLEDGES THAT IT HAS HAD THE
ASSISTANCE OF COUNSEL IN THE REVIEW AND EXECUTION OF THIS GUARANTY AND,
SPECIFICALLY, SECTION 22 HEREOF, AND FURTHER ACKNOWLEDGES THAT THE MEANING AND
EFFECT OF THE FOREGOING WAIVER OF JURY TRIAL HAS BEEN FULLY EXPLAINED TO IT BY
SUCH COUNSEL.
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IN WITNESS WHEREOF, the undersigned, by their duly authorized officers,
as applicable, have executed this Second Amended and Restated Guaranty Agreement
the day and year first above written.
Attest: MARKETING SPECIALISTS SALES COMPANY
By: By:
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Name: Name:
Title: Title:
Attest: BROMAR, INC.
By: By:
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Name: Name:
Title: Title:
Attest: XXXX XXXXX ASSOCIATES, INC.
By: By:
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Name: Name:
Title: Title:
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