HOLDINGS/THOMPSON/CENTER ARMS/SMITH & WESSON GUARANTY
EXHIBIT 10.75
HOLDINGS/▇▇▇▇▇▇▇▇/CENTER ARMS/▇▇▇▇▇ & WESSON GUARANTY
THIS GUARANTY (as amended, restated, supplemented or otherwise modified from time to time,
this “Agreement”), dated as of July 20, 2009, is made by and among ▇▇▇▇▇ & Wesson Holding
Corporation, a Nevada corporation (“Holdings”), ▇▇▇▇▇▇▇▇/Center Arms Company, Inc., a New
Hampshire corporation (“TCAC”), ▇▇▇▇▇ & Wesson Corp., a Delaware corporation (“S&W
Corp.”), and those additional entities that hereafter become guarantors hereunder by executing
a joinder agreement substantially in the form of Exhibit A hereto (each a
“Guarantor” and collectively the “Guarantors”), and TD Bank, N.A., as
administrative agent (in such capacity, the “Administrative Agent”) for the Secured Parties
(as defined in the Credit Agreement referred to below).
Holdings, S & W Corp., and TCAC have entered into a Credit Agreement, dated as of November 30,
2007, with the lenders party from time to time party thereto (the “Lenders”), and the
Administrative Agent, as amended by that certain Amendment No. 1 to Credit Agreement and Assignment
and Acceptance of Collateral Documents dated as of October 31, 2008, among Holdings, S&W Corp.,
TCAC, the Lenders and the Administrative Agent, as amended by that certain Amendment No. 2 to
Credit Agreement dated as of March 12, 2009, and as further amended this date by that certain
Amendment No. 3 to Credit Agreement among Holdings, S&W Corp., TCAC, Universal Safety Response,
Inc. (“USR”) (Holdings, S&W Corp., TCAC and USR are, each individually, “Borrower”, and
collectively, “Borrowers”), the Lenders and the Administrative Agent (as amended, restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”). Capitalized
terms used and not defined herein are used with the meanings assigned to such terms in the Credit
Agreement.
The Lenders have agreed to make Loans and grant financial accommodations to one or more of the
Borrowers, pursuant to, and upon the terms and subject to the conditions specified in, the Credit
Agreement. Each Guarantor acknowledges that it has derived and will derive substantial benefit
from the making of the Loans by the Lenders to the Borrowers. As consideration therefor and in
order to induce the Lenders to make Loans, each Guarantor is willing to execute this Agreement.
Accordingly, the parties hereto agree as follows:
SECTION 1. Guarantee. Each Guarantor unconditionally guarantees, jointly with any other
Guarantor of the several Obligations of USR under the Credit Agreement and other Loan Documents
(“USR’s Obligations”) and severally, as a primary obligor and not merely as a surety, the
due and punctual payment of USR’s Obligations. Each Guarantor waives notice of, and hereby
consents to any agreements or arrangements whatsoever by the Secured Parties with any other Person
pertaining to USR’s Obligations, including agreements and arrangements for payment, extension,
renewal, subordination, composition, arrangement, discharge or release of the whole or any part of
USR’s Obligations, or for the discharge or surrender of any or all security, or for the compromise,
whether by way of acceptance of part payment or otherwise, and, the same shall in no way impair
each Guarantor’s liability hereunder.
SECTION 2. USR’s Obligations Not Waived. To the fullest extent permitted by applicable law,
each Guarantor waives presentment to, demand of payment from and protest to
USR or any other Person of any of USR’s Obligations, and also waives notice of acceptance of
its guarantee, notice of protest for nonpayment and all other formalities. To the fullest extent
permitted by applicable law, the Guarantee of each Guarantor hereunder shall not be affected by (a)
the failure of any Loan Party to assert any claim or demand or to enforce or exercise any right or
remedy against USR or any Guarantor under the provisions of the Credit Agreement, any other Loan
Document or otherwise; (b) any extension, renewal or increase of or in any of USR’s Obligations;
(c) any rescission, waiver, amendment or modification of, or any release from, any of the terms or
provisions of this Agreement, the Credit Agreement, any other Loan Document, any guarantee or any
other agreement or instrument, including with respect to any Guarantor under the Loan Documents;
(d) the release of (or the failure to perfect a security interest in) any of the security held by
or on behalf of the Administrative Agent or any other Secured Party; or (e) the failure or delay of
any Secured Party to exercise any right or remedy against USR or any Guarantor of USR’s
Obligations.
SECTION 3. Security. Each Guarantor authorizes the Administrative Agent to (a) take and hold
security for the payment of this Guaranty and USR’s Obligations and exchange, enforce, waive and
release any such security pursuant to the terms of any other Loan Documents; (b) apply such
security and direct the order or manner of sale thereof as it in its sole discretion may determine
subject to the terms of any other Loan Documents; and (c) release or substitute any one or more
endorsees, other Guarantors or other obligors pursuant to the terms of any other Loan Documents.
In no event shall this Section 3 require any Guarantor to grant security, except as required by the
terms of the Loan Documents.
SECTION 4. Guarantee of Payment. Each Guarantor further agrees that its guarantee constitutes
a guarantee of payment when due and not of collection and waives any right to require that any
resort be had by the Administrative Agent or any other Secured Party to any of the security held
for payment of USR’s Obligations or to any balance of any deposit account or credit on the books of
the Administrative Agent or any other Secured Party in favor of USR or any other Person.
SECTION 5. No Discharge or Diminishment of Guaranty. The obligations of each Guarantor
hereunder shall not be subject to any reduction, limitation, impairment or termination for any
reason (other than the indefeasible payment in full in cash of USR’s Obligations), including any
claim of waiver, release, surrender, alteration or compromise of any of USR’s Obligations, and
shall not be subject to any defense (other than a defense of payment) or setoff, counterclaim,
recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of
USR’s Obligations or otherwise. Without limiting the generality of the foregoing, the obligations
of each Guarantor hereunder shall not be discharged or impaired or otherwise affected by the
failure of the Administrative Agent or any other Secured Party to assert any claim or demand or to
enforce any remedy under the Credit Agreement, any other Loan Document, any guarantee or any other
agreement or instrument, by any amendment, waiver or modification of any provision of the Credit
Agreement or any other Loan Document or other agreement or instrument, by any default, failure or
delay, willful or otherwise, in the performance of USR’s Obligations, or by any other act, omission
or delay to do any other act that may or might in any manner or to any extent vary the risk of any
Guarantor or that would otherwise operate as a discharge of any Guarantor as a matter of law or
equity (other than the
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indefeasible payment in full in cash of all USR’s Obligations) or which would impair or
eliminate any right of any Guarantor to subrogation.
SECTION 6. Defenses Waived. To the fullest extent permitted by applicable law, each Guarantor
waives any defense based on or arising out of the unenforceability of USR’s Obligations or any part
thereof from any cause or the cessation from any cause of the liability (other than the final and
indefeasible payment in full in cash of USR’s Obligations) of USR or any other Person. Subject to
the terms of the other Loan Documents, the Administrative Agent and the other Secured Parties may,
at their election, foreclose on any security held by one or more of them by one or more judicial or
nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or
adjust any part of USR’s Obligations, make any other accommodation with USR or any other Guarantor
or exercise any other right or remedy available to them against USR or any other Guarantor, without
affecting or impairing in any way the liability of each Guarantor hereunder except to the extent
USR’s Obligations have been fully, finally and indefeasibly paid in cash. Each Guarantor waives
any defense arising out of any such election even though such election operates, pursuant to
applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of each Guarantor against USR or any other Guarantor or any security.
SECTION 7. Agreement to Pay; Subordination. In furtherance of the foregoing and not in
limitation of any other right that the Administrative Agent or any other Secured Party has at law
or in equity against each Guarantor by virtue hereof, upon the failure of USR or any other Loan
Party to pay any Secured Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will
forthwith pay, or cause to be paid, to the Administrative Agent or such other Secured Party as
designated thereby in cash an amount equal to the unpaid principal amount of such Obligations then
due, together with accrued and unpaid interest and fees on such Obligations. Upon payment by each
Guarantor of any sums to the Administrative Agent or any Secured Party as provided above, all
rights of each Guarantor against USR arising as a result thereof by way of right of subrogation,
contribution, reimbursement, indemnity or otherwise shall in all respects be subordinate and junior
in right of payment to the prior indefeasible payment in full in cash of all USR’s Obligations. In
addition, any indebtedness of USR or any Subsidiary now or hereafter held by each Guarantor that is
required by the Credit Agreement to be subordinated to USR’s Obligations is hereby subordinated in
right of payment to the prior payment in full of USR’s Obligations. If any amount shall be paid to
any Guarantor on account of (i) such subrogation, contribution, reimbursement, indemnity or similar
right or (ii) any such indebtedness at any time when any Secured Obligation then due and owing has
not been paid, such amount shall be held in trust for the benefit of the Secured Parties and shall
forthwith be paid to the Administrative Agent to be credited against the payment of USR’s
Obligations, whether matured or unmatured, in accordance with the terms of the Loan Documents.
SECTION 8. General Limitation on Guarantee Obligations. In any action or proceeding involving
any state corporate law, or any state, Federal or foreign bankruptcy, insolvency, reorganization or
other law affecting the rights of creditors generally, if the obligations of any Guarantor under
this Agreement would otherwise be held or determined to be void, voidable, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account of the amount of
its liability under this Agreement, then, notwithstanding any other
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provision to the contrary, the amount of such liability shall, without any further action by
any Guarantor, any creditor or any other Person, be automatically limited and reduced to the
highest amount that is valid and enforceable and not subordinated to the claims of other creditors
as determined in such action or proceeding.
SECTION 9. Information. Each Guarantor assumes all responsibility for being and keeping
itself informed of USR’ financial condition and assets, all other circumstances bearing upon the
risk of nonpayment of USR’s Obligations and the nature, scope and extent of the risks that each
Guarantor assumes and incurs hereunder and agrees that none of the Administrative Agent or the
other Secured Parties will have any duty to advise such Guarantor of information known to it or any
of them regarding such circumstances or risks.
SECTION 10. Covenant; Representations and Warranties. Each Guarantor represents and warrants
as to itself that all representations and warranties relating to it contained in the Credit
Agreement are true and correct.
SECTION 11. Termination. The Guaranties made hereunder shall terminate when (i) the principal
of and premium, if any, and interest (including interest accruing during the pendency of any
bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding) on the Real Estate Loan and the Term Loan; and (ii) all other USR’s
Obligations then due and owing, have in each case been indefeasibly paid in full in cash and the
Lenders have no further commitment to lend under the Credit Agreement; provided that any such
Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any
payment, or any part thereof, on any Secured Obligation is rescinded or must otherwise be restored
by any Secured Party upon the bankruptcy or reorganization of USR, the Guarantors or otherwise.
Upon such termination and at the written request of any Guarantor or its successors or assigns, and
at the cost and expense of such Guarantor or its successors or assigns, the Administrative Agent
shall execute in a timely manner a satisfaction of this Guaranty and such instruments, documents or
agreements as are necessary or desirable to evidence the termination of this Guaranty.
SECTION 12. Binding Effect; Several Agreement; Assignments; Releases. Whenever in this
Agreement any of the parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party; and all covenants, promises and agreements by or on behalf of
each Guarantor that are contained in this Agreement shall bind and inure to the benefit of each
party hereto and their respective successors and assigns. This Agreement shall become effective as
to each Guarantor when a counterpart hereof executed on behalf of each Guarantor shall have been
delivered to the Administrative Agent and a counterpart hereof shall have been executed on behalf
of the Administrative Agent, and thereafter shall be binding upon each Guarantor and the
Administrative Agent and their respective successors and assigns, and shall inure to the benefit of
each Guarantor, the Administrative Agent and the other Secured Parties, and their respective
successors and assigns, except that neither the Borrowers nor the Guarantors shall have the right
to assign its rights or obligations hereunder or any interest herein (and any such attempted
assignment shall be void) without the prior written consent of the Required Lenders. The
Administrative Agent is hereby expressly authorized to, and agrees upon request of the Borrowers it
will, release any Guarantor from its obligations hereunder in the event that all
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the Equity Interests of such Guarantor shall be sold, transferred or otherwise disposed of in
a transaction permitted by the Credit Agreement.
SECTION 13. Waivers; Amendment. (a) No failure or delay of the Administrative Agent in
exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or the exercise of
any other right or power. The rights and remedies of the Administrative Agent hereunder and of the
other Secured Parties under the other Loan Documents are cumulative and are not exclusive of any
rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or
consent to any departure by any Guarantor therefrom shall in any event be effective unless the same
shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given. No notice 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.
(b) Neither this Agreement nor any provision hereof may be waived, amended or modified except
pursuant to a written agreement entered into between USR, the Guarantors and the Administrative
Agent (with the consent of the Required Lenders if required under the Credit Agreement).
SECTION 14. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK INCLUDING, BUT NOT LIMITED TO, SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW.
SECTION 15. Notices. All communications and notices hereunder shall be in writing and given
as provided in Section 10.02 of the Credit Agreement. All communications and notices hereunder to
each Guarantor shall be given to it at the following address:
▇▇▇▇▇ & Wesson Holding Corporation
c/▇ ▇▇▇▇▇ & Wesson Corp.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer
Facsimile No: ▇▇▇-▇▇▇-▇▇▇▇
c/▇ ▇▇▇▇▇ & Wesson Corp.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer
Facsimile No: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇▇ Traurig, LLP
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇; ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇▇ Traurig, LLP
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇; ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
SECTION 16. Survival of Agreement; Severability. (a) All covenants, agreements,
representations and warranties made by USR and the Guarantors herein and in the certificates or
other instruments prepared or delivered in connection with or pursuant to this Agreement or any
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other Loan Document shall be considered to have been relied upon by the Administrative Agent
and the other Secured Parties and shall survive the making by the Lenders of the Loans regardless
of any investigation made by the Secured Parties or on their behalf, and shall continue in full
force and effect as long as the principal of or any accrued interest on any Loan or any other fee
or amount payable under this Agreement or any other Loan Document is outstanding and unpaid or the
Commitments have not been terminated.
(b) In the event any one or more of the provisions contained in this Agreement or in any other
Loan Document should be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and therein shall not in
any way be affected or impaired thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect
of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.
SECTION 17. Counterparts. This Agreement may be executed in counterparts, each of which shall
constitute an original, but all of which when taken together shall constitute a single contract,
and shall become effective as provided in Section 12. Delivery of an executed signature page to
this Agreement by facsimile transmission or electronic mail shall be as effective as delivery of a
manually executed counterpart of this Agreement.
SECTION 18. Rules of Interpretation. The rules of interpretation specified in Section 1.01 of
the Credit Agreement shall be applicable to this Agreement.
SECTION 19. Jurisdiction; Consent to Service of Process. (a) EACH PARTY HERETO IRREVOCABLY
AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT
OF THE SOUTHERN DISTRICT OF SUCH STATE, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR
RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN
SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT
OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT
SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY OTHER LOAN
PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
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(b) EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY
COURT REFERRED TO IN PARAGRAPH (A) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO
THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(c) EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR
NOTICES IN SECTION 15 OF THIS AGREEMENT. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY
PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
SECTION 20. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY
OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE
OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 20.
[Signature Page Follows]
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[Signature Page to Holdings/▇▇▇▇▇▇▇▇/Center Arms/▇▇▇▇▇ & Wesson Guaranty]
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.
| ▇▇▇▇▇ & WESSON HOLDING CORPORATION |
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| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Vice President, Chief Financial Officer and Treasurer |
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| ▇▇▇▇▇▇▇▇/CENTER ARMS COMPANY, INC. |
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| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Vice President, Chief Financial Officer and Treasurer |
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| ▇▇▇▇▇ & WESSON CORPORATION |
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| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Vice President, Chief Financial Officer and Treasurer |
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[Signature Page to Holdings/▇▇▇▇▇▇▇▇/Center Arms Guaranty]
| ADMINISTRATIVE AGENT AND LENDER: TD BANK, N.A. |
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| By: | /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ | |||
| ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ | ||||
| Senior Vice President | ||||