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GUARANTY
This GUARANTY (this "Guaranty"), dated as of March __ 1997, by the
Guarantors identified as such on the signature pages hereof (each, a "Guarantor"
and collectively, "Guarantors"), in favor of GENERAL ELECTRIC CAPITAL
CORPORATION, a New York corporation, individually and as agent (in such
capacity, "Agent") for itself and the lenders signatory to the Credit Agreement
hereinafter defined ("Lenders").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Credit Agreement dated as of the
date hereof among Xxxx Perfumes Corp. ("Borrower"), the other Persons named
therein as Credit Parties, Agent and the Persons named therein as Lenders (as
from time to time amended, restated, supplemented or otherwise modified, the
"Credit Agreement"), Lenders have agreed to make Loans to Borrower.
WHEREAS, Guarantors have both direct and indirect parent-subsidiary
relationships with Borrower and with each other and as such will derive direct
and indirect economic benefits from the making of the Loans and other financial
accommodations provided to Borrower pursuant to the Credit Agreement; and
WHEREAS, in connection with the making of the Loans under the Credit
Agreement and as a condition precedent thereto, Lenders require that Guarantors
shall have executed and delivered this Guaranty;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, and to induce Lenders to provide the Loans and other
financial accommodations 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, unless the context otherwise
requires or unless otherwise defined herein.
References to this "Guaranty" shall mean this Guaranty, including
all amendments, modifications and supplements and any exhibits or 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.
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2. THE GUARANTY. The guaranty of Guarantors hereunder is as follows:
2.1 Guaranty of Guaranteed Obligations of Borrower. Each Guarantor
hereby jointly and severally unconditionally guarantees to Agent and 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 of Borrower (hereinafter the "Guaranteed
Obligations"). Guarantors agree that this Guaranty is a guaranty of payment and
performance and not of collection, and that their 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 Guarantors are 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 its 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); or
(d) 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 payment and performance, in full, of the Guaranteed
Obligations. Each Guarantor shall be regarded, and shall be in the same
position, as principal debtor with respect to the Guaranteed Obligations. Each
Guarantor expressly waives all rights it may have now or in the future under any
statute, or at common law, or at law or in equity, or otherwise, to compel Agent
or Lenders to proceed in respect of the Guaranteed Obligations against Borrower
or any other Credit Party or against any Collateral for the payment and
performance of the Guaranteed Obligations before proceeding against, or as a
condition to proceeding against, any Guarantor. Each Guarantor agrees that any
notice or directive given at any time to Agent which is
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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 each Guarantor, 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 the
then 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 Guarantors shall, without demand, pay to the holders of
the Guaranteed Obligations the entire outstanding Guaranteed Obligations due and
owing to such holders. Payment by Guarantors shall be made to Agent, shall be
credited and applied upon the Guaranteed Obligations, in immediately available
Federal 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.
2.3 Enforcement of Guaranty. In no event shall Agent have any
obligation (although it is entitled, at its option) to proceed against Borrower
or any other Credit Party or any real or personal property pledged to secure
Guaranteed Obligations before seeking satisfaction from Guarantors, and Agent
may proceed, prior or subsequent to, or simultaneously with, the enforcement of
Agent's rights hereunder, to exercise any right or remedy which it may have
against any property, real or personal, 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, Guarantors waive, and agree that they shall not at any time insist upon,
plead or in any manner whatever 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 Guarantors of their Guaranteed
Obligations under, or the enforcement by Agent or Lenders of, this Guaranty.
Guarantors hereby waive diligence, presentment and demand (whether for
non-payment or protest or of
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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 Borrower's financial
condition or any other fact which might materially increase the risk to
Guarantors) with respect to any of the Guaranteed Obligations or all other
demands whatsoever and waive the benefit of all provisions of law which are or
might be in conflict with the terms of this Guaranty. Guarantors represent,
warrant and jointly and severally agree that, as of the date of this Guaranty,
their obligations under this Guaranty are not subject to any offsets or defenses
against Agent or Lenders or any Credit Party of any kind. Guarantors further
jointly and severally agree that their 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. If Agent and
Lenders shall at any time or from time to time, with or without the consent of,
or notice to, Guarantors or any of them:
(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
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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;
(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 Guaranteed
Obligations;
(f) release anyone who may be liable in any manner for the
payment of any amounts owed by Guarantors 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
Guarantors or Borrower 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 Guarantors or Borrower to Agent or any Lender in such
manner as Agent or any Lender shall determine in its discretion;
then Agent and Lenders shall not incur any liability to Guarantors as a result
thereof, and no such action shall impair or release the Guaranteed Obligations
of Guarantors or any of them 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 such 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
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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 on 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 Guaranteed Obligations
have been paid in full in cash, 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 a guarantor against a principal, to a 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 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 Guarantor
is a party or otherwise;
(b) acknowledges and agrees (i) that this waiver is intended to
benefit Agent and Lenders and shall not limit or otherwise effect each
Guarantor's liability hereunder or the enforceability of this Guaranty, and (ii)
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 and
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, Guarantors hereby consent to such action by Agent and
waive 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 Guarantors
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 each Guarantor's
obligation to pay the full amount of the Guaranteed
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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.
2.10 Continuing Guaranty. Guarantors agree that 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.
2.11 Funds Transfers. If any Guarantor shall engage in any
transaction as a result of which Borrower is required to make a mandatory
prepayment with respect to the Loans under the terms of the Credit Agreement
(including any sale of such Guarantor's Stock or assets), such Guarantor shall
distribute to, or make a contribution to the capital of, Borrower an amount
equal to the mandatory prepayment required under the terms of the Credit
Agreement.
3. DELIVERIES. In a form satisfactory to Agent, Guarantors 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
Guarantors to Agent under the Credit Agreement.
4. REPRESENTATIONS AND WARRANTIES. To induce Lenders to make the
Loans under the Credit Agreement, each Guarantor jointly and severally makes the
following representations and warranties to Agent and each Lender, each and all
of which shall survive the execution and delivery of this Guaranty:
4.1 Corporate Existence; Compliance with Law. Each Guarantor (i) is
a corporation duly organized, validly existing and in good standing under the
laws of the state of its organization; (ii) is duly qualified to do business and
is in good standing under the laws of each jurisdiction where its ownership or
lease of property or the conduct of its business requires such qualification
(except for jurisdictions in which
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such failure so to qualify or to be in good standing would not be expected to
have a Material Adverse Effect; (iii) has the requisite corporate power and
authority and the legal right to own, pledge, mortgage and operate its
properties, to lease the property it operates under lease, and to conduct its
business as now, heretofore and proposed to be conducted; (iv) has all material
licenses, permits, consents or approvals from or by, and has made all material
filings with, and has given all material notices to, all governmental
authorities having jurisdiction, to the extent required for such ownership,
operation and conduct; (v) is in compliance with its articles or certificate of
incorporation and by-laws; and (vi) is in compliance with all applicable
provisions of law where the failure to comply could be expected to have a
Material Adverse Effect.
4.2 Executive Offices. Each Guarantor's executive office and
principal place of business are as set forth in Schedule III to the Security
Agreement.
4.3 Corporate Power; Authorization; Enforceable Guaranteed
Obligations. The execution, delivery and performance of this Guaranty and all
other Loan Documents and all instruments and documents to be delivered by each
Guarantor hereunder and under the Credit Agreement are within such Guarantor's
corporate powers, have been duly authorized by all necessary or proper corporate
action, including the consent of stockholders where required, are not in
contravention of any provision of such Guarantor's articles or certificate of
incorporation or by-laws, will not violate any law or regulation, or any order
or decree of any court or governmental instrumentality, will not conflict with
or result in the breach of, or constitute a default under, any indenture,
mortgage, deed of trust, lease, agreement or other instrument to which any
Guarantor is a party or by which any Guarantor or any of its property is bound,
will not result in the creation or imposition of any Lien upon any of the
property of any Guarantor, other than those in favor of Agent, for itself and
the benefit of Lenders, and the same do not require the consent or approval of
any governmental body, agency, authority or any other Person except those
already obtained. At or prior to the Closing Date, this Guaranty and each of the
Loan Documents to which any Guarantor is a party shall have been duly executed
and delivered for the benefit of or on behalf of such Guarantor, and each shall
then constitute a legal, valid and binding obligation of such Guarantor,
enforceable against such Guarantor in accordance with its terms.
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
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considered necessary by Agent or such Lender to cause this Guaranty to be,
become or remain valid and effective in accordance with its terms.
6. PAYMENTS FREE AND CLEAR OF TAXES. All payments required to be
made by each Guarantor hereunder shall be made to Agent and Lenders free and
clear of, and without deduction for, any and all present and future taxes,
withholdings, levies, duties, and other governmental charges ("Taxes"). Upon
request by Agent or any Lender, each Guarantor shall furnish to Agent or such
Lender a receipt for any Taxes paid by such Guarantor pursuant to this Section 6
or, if no Taxes are payable with respect to this Section 6, either a certificate
from each appropriate taxing authority or an opinion of counsel acceptable to
Agent or such Lender, in either case stating that such payment is exempt from or
not subject to Taxes. If Taxes are paid by Agent or any Lender, such Guarantor
will, upon demand of Agent or such Lender, and whether or not such Taxes shall
be correctly or legally asserted, indemnify Agent or such Lender for such
payments, together with any interest, penalties and expenses in connection
therewith plus interest thereon at the rate, if any, specified in the Credit
Agreement applicable to Index Rate Loans (calculated as if such payments
constituted overdue amounts of principal as of the date of the making of such
payments).
7. OTHER TERMS.
7.1 Entire Agreement; Amendments. This Guaranty, together with the
other Loan Documents, constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all prior agreements
relating to a guaranty of the loans and advances under the Loan Documents and/or
the Guaranteed Obligations and may not be amended or supplemented except by a
writing signed by Guarantors and Agent.
7.2 Headings. The headings in this Guaranty are for convenience of
reference only and are not part of the substance of this Guaranty.
7.3 Severability. Whenever possible, each provision of this Guaranty
shall be interpreted in such a manner to be effective and valid under applicable
law, but if any provision of this Guaranty shall be prohibited by or invalid
under applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Guaranty.
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7.4 Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by another, or whenever any of the parties desires to give or serve upon
another any such communication with respect to this Guaranty, each such notice,
demand, request, consent, approval, declaration or other communication shall be
in writing and either shall be delivered in person with receipt acknowledged or
by registered or certified mail, return receipt requested, postage prepaid, or
by telecopy and confirmed by telecopy answerback addressed as follows:
(a) If to Agent, at:
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Accounts Manager - Renaissance
Telecopier Number: (000) 000-0000
with copies to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxx X. Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
and:
General Electric Capital Corporation
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attention: Corporate Counsel - Commercial Finance
Telecopier Number: (000) 000-0000
(b) If to any Lender, at the address of such Lender specified in
the Credit Agreement.
(c) If to any Guarantor, at the address of such Guarantor
specified on Schedule I hereto.
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with a copy to:
Xxxxxxxxxx Xxxxx Xxxxxx & Xxxxxxxxxx, P.C.
000 00xx Xxxxxx - 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxx X. Xxxxxxx, Esq.
Telecopier Number: (000) 000-0000
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
consent, approval, declaration or other communication hereunder shall be deemed
to have been validly served, given or delivered (i) upon the earlier of actual
receipt and three (3) Business Days after the same shall have been deposited
with the United States mail, registered or certified mail, return receipt
requested, with proper postage prepaid, (ii) upon transmission, when sent by
telecopy and confirmed by telecopy answerback, (iii) one (1) Business Day after
deposit with a reputable overnight carrier with all charges prepaid, or (iv)
when delivered, if hand-delivered by messenger. Failure or delay in delivering
copies of any notice, demand, request, consent, approval, declaration or other
communication to the persons designated above to receive copies shall in now way
adversely affect the effectiveness of such notice, demand, request, consent,
approval, declaration or other communication.
7.5 Successors and Assigns. This Guaranty and all obligations of
Guarantors hereunder shall be binding upon the successors and assigns of each
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.
Guarantors may not assign, sell or otherwise transfer any interest in or
obligation under this Guaranty.
7.6 No Waiver; Cumulative Remedies. 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
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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 or amended except by an instrument in writing, duly
executed by Agent and Guarantors.
7.7 Termination. This Guaranty shall terminate and be of no further
force or effect at such time as the Guaranteed Obligations shall be paid and
performed in full. Upon payment and performance in full of the Guaranteed
Obligations, Agent shall deliver to Guarantors such documents as Guarantors may
reasonably request to evidence such termination.
7.8 GOVERNING LAW; CONSENT TO JURISDICTION AND VENUE. EXCEPT AS
OTHERWISE EXPRESSLY PROVIDED IN ANY OF THE LOAN DOCUMENTS, IN ALL RESPECTS,
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS GUARANTY
AND THE OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE, AND ANY APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA. EACH GUARANTOR HEREBY CONSENTS AND AGREES THAT THE
STATE OR FEDERAL COURTS LOCATED IN NEW YORK COUNTY, CITY OF NEW YORK, NEW YORK,
SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN OR AMONG GUARANTORS, AGENT OR ANY LENDER PERTAINING TO THIS GUARANTY OR
TO ANY MATTER ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OF THE OTHER
LOAN DOCUMENTS, PROVIDED, THAT AGENT AND GUARANTORS ACKNOWLEDGE THAT ANY APPEALS
FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK
COUNTY, CITY OF NEW YORK, NEW YORK, AND, PROVIDED, FURTHER, THAT NOTHING IN THIS
GUARANTY SHALL BE DEEMED OR OPERATE TO PRECLUDE AGENT FROM BRINGING SUIT OR
TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO
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REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE GUARANTEED OBLIGATIONS,
OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF AGENT, FOR THE BENEFIT
OF AGENT AND LENDERS. EACH GUARANTOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE
TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH
GUARANTOR HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF
PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY
CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY SUCH COURT. EACH GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE
SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND
AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY
REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH GUARANTOR AT THE ADDRESS SET
FORTH ON SCHEDULE I HERETO AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED
UPON THE EARLIER OF ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN
THE U.S. MAILS, PROPER POSTAGE PREPAID.
7.9 Counterparts. This Guaranty may be executed in any number of
separate counterparts each of which shall collectively and separately constitute
one and the same agreement.
7.10 WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN CONNECTION
WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED
BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND
FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), EACH GUARANTOR AND AGENT
DESIRES THAT DISPUTES ARISING HEREUNDER OR RELATING HERETO BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OR ARBITRATION, EACH GUARANTOR AND
AGENT WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED IN CONNECTION WITH THIS GUARANTY
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AND THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS RELATED HERETO OR THERETO.
7.11 Limitation on Guaranteed Obligations. Notwithstanding any
provision herein contained to the contrary, each Guarantor's liability hereunder
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 and other extensions of credit
advanced under the Credit Agreement and directly or indirectly re-loaned or
otherwise transferred to, or incurred for the benefit of, such Guarantor, plus
interest thereon at the rate specified in the Credit Agreement; or
(B) the amount which could be claimed by the Agent and Lenders from
such 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 of common law (taking into account such Guarantor's right
of contribution and indemnity under Section 7.12).
7.12 Contribution with Respect to Guaranteed Obligations.
(a) To the extent that any Guarantor shall make a payment under this
Guaranty of all or any of the Guaranteed Obligations (a "Guarantor Payment")
which, taking into account all other Guarantor Payments then previously or
concurrently made by the other Guarantors, exceeds the amount which such
Guarantor would otherwise have paid if each Guarantor had paid the aggregate
Guaranteed Obligations satisfied by such Guarantor Payment in the same
proportion that such Guarantor's "Allocable Amount" (as defined below) (in
effect immediately prior to such Guarantor Payment) bore to the aggregate
Allocable Amounts of all of Guarantors in effect immediately prior to the making
of such Guarantor Payment, then such Guarantor shall be entitled to receive
contribution and indemnification payments from, and be reimbursed by, each of
the other Guarantors 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 which could then be
recovered from such Guarantor under this Guaranty without rendering such claim
voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or
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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.
(d) The rights of the parties under this Section 7.12 shall be
exercisable upon the full and indefeasible payment of the Guaranteed Obligations
and the termination of the Credit Agreement and the other Loan Documents.
(e) The parties hereto acknowledge that the rights of contribution
and indemnification hereunder shall constitute assets of any Guarantor to which
such contribution and indemnification is owing.
7.13 SECURITY. To secure payment of each Guarantor's obligations
under this Guaranty, concurrently with the execution of this Guaranty, each
Guarantor has entered into a Security Agreement pursuant to which each Guarantor
has granted to Agent for the benefit of Lenders a security interest in
substantially all of its personal property and certain Guarantors have entered
into a Pledge Agreement pursuant to which such Guarantor has pledged all or a
portion of the Stock of certain of its Subsidiaries to Agent for the benefit of
Lenders.
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IN WITNESS WHEREOF, Guarantors have executed and delivered this
Guaranty as of the date first above written.
GUARANTORS:
RENAISSANCE COSMETICS, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
COSMAR CORPORATION
By:____________________________________
Name:__________________________________
Title:_________________________________
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GREAT AMERICAN COSMETICS, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
MEM COMPANY, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
ARISTOCRAT LEATHER PRODUCTS, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
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XXXXXX XXXXXX, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
ENGLISH LEATHER, INC.
By:____________________________________
Name:__________________________________
Title:_________________________________
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Accepted and acknowledged by:
GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent
By:____________________________________
Name:__________________________________
Title:_________________________________
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