EXHIBIT 10.4
LOAN NO. 3031697
GUARANTY OF PAYMENT AND PERFORMANCE
This Guaranty is made as of June 16th, 1998 by ATL ULTRASOUND, INC., a
Washington corporation, formerly known as ADVANCED TECHNOLOGY LABORATORIES,
INC., a Delaware corporation ("GUARANTOR"), to BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, doing business as SEAFIRST BANK, and its successors,
participants and assigns ("LENDER").
RECITALS:
A. Pursuant to a Promissory Note of even date executed by Borrower to the
order of Lender, Lender has agreed to make a loan (the "LOAN") to ADVANCED
TECHNOLOGY LABORATORIES, INC., a Washington corporation ("BORROWER"), in the
amount of Seventeen Million Dollars ($17,000,000). The Loan is secured by a
Deed of Trust, Security Agreement and Fixture Filing with Assignment of Leases
and Rents dated December 28, 1994, made by Borrower as Grantor, recorded in the
real property records of Snohomish County, Washington under Recording No.
9412790067, as amended by a Loan Modification Agreement of even date among
Lender, Borrower and Guarantor. In addition to the foregoing documents,
Borrower has executed and delivered to Lender in connection with the Loan
certain other documents, all of which are collectively referred to in this
Guaranty as the "LOAN DOCUMENTS"; except the term Loan Documents does not
include that certain Certificate and Indemnity Agreement Regarding Hazardous
Substances and Building Laws dated December 28, 1994 made by Borrower for the
benefit of Lender (the "CERTIFICATE AND INDEMNITY AGREEMENT").
B. Guarantor has agreed to unconditionally guarantee the full and punctual
payment and performance of the "GUARANTEED OBLIGATIONS" (defined below). As
used in this Guaranty, the term "GUARANTEED OBLIGATIONS" means all debts,
duties, undertakings, obligations, covenants and conditions to be paid or
performed by Borrower in connection with the Loan, including without limitation
all of Borrower's obligations under the Loan Documents, the Certificate and
Indemnity Agreement, and under each and every existing or future "swap"
transaction (i.e., any transactions governed by an ISDA master agreement)
between Lender and Borrower (or any other obligor of the Loan), in which this
Guaranty is expressly referred to as a credit support document, and any and all
extensions, renewals or modifications thereof, including the obligations to pay
as and when due principal, interest, attorneys' fees and all other debts of
Borrower arising under and by reason of the Loan Documents and the Certificate
and Indemnity Agreement.
AGREEMENT:
For good and valuable consideration, the receipt and sufficiency of which are
acknowledged, Guarantor agrees as follows:
-1-
1. Guarantee. Guarantor unconditionally guarantees to and for the benefit of
---------
Lender the full, prompt and complete payment and performance by Borrower of the
Guaranteed Obligations. If any of Borrower's obligations, covenants, and
agreements under the Loan Documents or under the Certificate and Indemnity
Agreement are not paid or performed as and when such payment or performance is
due or required, on demand from Lender, Guarantor will pay or perform the same.
2. Independent Obligation. This Guaranty is an independent obligation of
----------------------
Guarantor, separate and distinct from the Guaranteed Obligations. A separate
action may be brought or prosecuted against Guarantor, whether or not any such
action is brought or prosecuted against Borrower or whether Borrower is joined
in any such action or actions. This Guaranty is an absolute guarantee of
payment and performance, and not a guarantee of collection. The obligations of
Guarantor under this Guaranty are direct and primary, regardless of the validity
or enforceability of the Loan Documents or the Certificate and Indemnity
Agreement or any renewal, extension or modification thereof. Guarantor shall
continue to be liable under this Guaranty even if all or part of the Guaranteed
Obligations become uncollectible by operation of law or otherwise.
3. Waivers. Guarantor waives (a) notice of Lender's acceptance of this
-------
Guaranty; (b) notice of any advances made by Lender pursuant to the Loan
Documents or the Certificate and Indemnity Agreement, or pursuant to any
extension, renewal or modification thereof; (c) any defense arising from or out
of the exercise by Lender of any right or remedy it may have with respect to the
Guaranteed Obligations; (d) grace, demand, presentment, notice of dishonor and
protest with respect to the Guaranteed Obligations; (e) any defense based upon
any change in the name, location, composition or structure of Borrower, or any
change in the type of business conducted by Borrower, or any other change in the
financial condition, identity or legal status of Borrower; (f) the benefit of
suretyship defenses generally; and (g) any defense based upon any failure by
Lender to obtain a similar guaranty from any other person or entity, or file a
creditor's claim in the estate of any person or entity, including Borrower,
whether in administration, bankruptcy or any other proceeding.
4. Rights of Lender. Lender shall not be bound to exhaust its recourse or
----------------
take any action against Borrower or against any other person or entity, or
proceed against any collateral or against any particular collateral, but Lender
may make such demands and take such actions as it deems advisable, and Lender,
without affecting the liability of any Guarantor under this Guaranty, may with
or without notice or consideration (i) release any other person or entity liable
for the Guaranteed Obligations; (ii) extend the maturity, modify the terms,
grant any indulgence or forbearance or postpone the time of payment of the
Guaranteed Obligations or otherwise amend or modify the terms of any agreement
or instrument giving rise to all or any of the Guaranteed Obligations; and (iii)
release all or any part of the existing or any future security for the
Guaranteed Obligations. All rights and remedies of Lender under this Guaranty,
at law or in equity are separate and cumulative and may be pursued separately,
successively, or concurrently, or not pursued,
-2-
without affecting or limiting any other right or remedy of Lender and without
affecting or impairing the liability of Guarantor under this Guaranty.
5. Waiver of Subrogation and Reimbursement Rights. To the fullest extent
----------------------------------------------
permitted by applicable law, Guarantor releases and waives any claim, right or
remedy which Guarantor may have against Borrower arising from this Guaranty
and/or from the performance by Guarantor of his, her or its obligations under
this Guaranty, including any claim, remedy or right of subrogation,
reimbursement, exoneration, contribution, indemnification or participation in
any claim, right or remedy of Lender against Borrower, or any security which
Lender now has or hereafter acquires, whether such claim, right or remedy arises
under contract, by statute, under common law or otherwise.
6. Subordination of Debt. Any present or future indebtedness of Borrower to
---------------------
Guarantor is hereby subordinated to the Guaranteed Obligations. Any payment of
such indebtedness of Borrower to Guarantor shall be collected, enforced and
received by Guarantor in trust for the benefit of Lender and promptly paid over
to Lender on account of the Guaranteed Obligations, but without reducing or
affecting in any manner the liability of such Guarantor under the other
provisions of this Guaranty.
7. Guaranty Survives Foreclosure. Lender, at its option and in its sole
-----------------------------
discretion, may proceed against any collateral securing the Guaranteed
Obligations by way of either judicial or non-judicial foreclosure and the
obligations of Guarantor under this Guaranty shall survive such foreclosure.
Guarantor understands a non-judicial foreclosure of any deed of trust securing
the Guaranteed Obligations could impair or eliminate any subrogation or
reimbursement rights Guarantor may have against Borrower; nevertheless Guarantor
hereby waives and relinquishes any defense based upon the loss of any such
reimbursement or subrogation rights and any other defense which may arise out of
RCW 61.24, as now or hereafter amended or any legislation in substitution or
replacement thereof, including without limitation any defense based upon the
Washington Anti-Deficiency Statute, RCW 61.24.100, as now or hereafter amended,
and any defense that may arise out of election of remedies, or discharge or
satisfaction of the Guaranteed Obligations pursuant to RCW 61.24.100. If any
deed of trust securing the Guaranteed Obligations is foreclosed judicially or
non-judicially before Lender proceeds against Guarantor under this Guaranty,
Guarantor's liability for the obligations secured by such deed of trust shall be
the deficiency resulting from the judicial or non-judicial sale; i.e., the
difference between the amount of the obligations secured by the deed of trust on
the day of the foreclosure sale (including without limitation principal, accrued
interest, attorneys' fees, late charges and costs of foreclosure) and the amount
of the successful bid at the foreclosure sale. Guarantor further waives the
right to object to the amount which may be bid by Lender at any foreclosure
sale.
8. Application of Payments. Lender may apply any payments received by it
-----------------------
from any source against any portion of the Guaranteed Obligations in such order
and priority as Lender may deem appropriate.
-3-
9. Continuing Guaranty. This Guaranty covers any and all of the Guaranteed
-------------------
Obligations, whether presently outstanding or arising subsequent to the date of
this Guaranty. This Guaranty shall continue until each and every Guaranteed
Obligation is paid and performed in full. If at any time payment or performance
of all or any part of the Guaranteed Obligations is rescinded or must otherwise
be restored or returned by Lender as a result of the insolvency, bankruptcy or
reorganization of Borrower or otherwise, this Guaranty shall be reinstated.
Guarantor hereby assigns to Lender all rights against Borrower, related to the
Guaranteed Obligations, which Guarantor may have in any proceedings under the
United States Bankruptcy Code or in any receivership or other insolvency
proceeding. This Guaranty is binding upon and enforceable against Guarantor and
its devisees, personal representatives, successors and assigns. This Guaranty is
intended for and shall be binding upon and inure to the benefit of Lender and
each and every person or entity who, by assignment, endorsement, participation
agreement or otherwise, succeeds to all or any part of Lender's rights under the
Guaranteed Obligations, irrespective whether such transfer is voluntary or
involuntary or occurs by operation of law.
10. Financial Statements. Except as otherwise agreed in writing by Lender,
--------------------
within ninety (90) days after the end of each of its fiscal years, Guarantor
shall provide Lender with a CPA audited financial statement showing its
financial condition as of the end of the most recent fiscal year, prepared in
accordance with generally accepted accounting principles, consistently applied.
Upon request, Guarantor will provide Lender with a copy of his, her or its
United States federal income tax return for the tax year most recently ended.
11. Governing Law; Jurisdiction; Venue. This Guaranty shall be governed by
----------------------------------
and construed in accordance with the laws of the State of Washington. Guarantor
hereby submits irrevocably to the non-exclusive jurisdiction and venue of any
state or federal court in the State of Washington selected by Lender in any
action relating to or arising out of the enforcement or interpretation of this
Guaranty and Guarantor hereby irrevocably agrees that all claims in respect to
any such action or proceeding may be heard and determined in such Washington
State Court or such United States District Court sitting in the State of
Washington and to all the courts to which an appeal may be taken from such
courts. Guarantor expressly waives, to the fullest extent it may effectively do
so under applicable law, any objection it may at any time have: (a) as to venue
in such courts; (b) that any action or proceeding therein has been brought in an
inconvenient forum; (c) that any such court lacks jurisdiction over it; or (d)
as to service of process upon it in accordance with applicable law.
12. Costs and Expenses. Whether or not suit is brought, Guarantor shall pay
------------------
on demand all costs and expenses, including reasonable attorneys' fees incurred
by or on behalf of Lender in connection with the enforcement against or
collection from Borrower of all or any of the Guaranteed Obligations, or any
security therefor, or in connection with the enforcement, interpretation or
defense of this Guaranty to the extent Lender is the prevailing party. Without
limiting the generality of the foregoing, if Borrower or Guarantor becomes the
subject of any bankruptcy or other insolvency proceeding, Guarantor shall pay
all reasonable costs and expenses incurred by Lender in connection with such
bankruptcy or insolvency proceeding.
-4-
13. Representations and Warranties. Guarantor represents and warrants to
------------------------------
Lender that it (a) is adequately informed of the financial condition of
Borrower; (b) has not relied on any financial information about Borrower
furnished by Lender; and (c) does not expect Lender to provide any such
information in the future. Furthermore, Guarantor acknowledges Lender would not
make the Loan to Borrower without this Guaranty, and Guarantor has reviewed the
Loan Documents and the Certificate and Indemnity and is otherwise fully familiar
with the Guaranteed Obligations.
14. Miscellaneous. The obligations of Guarantor under this Guaranty shall be
-------------
independent of the obligations of Borrower and any other persons or entities
guaranteeing the payment or performance of the Guaranteed Obligations. The
obligations and liabilities of Guarantor hereunder shall not be limited in any
manner by any nonrecourse or other provisions in the Loan Documents or in the
Certificate and Indemnity Agreement which may limit the liability or obligations
of Borrower with respect to the Guaranteed Obligations. This Guaranty may be
executed in multiple counterparts, each counterpart shall be an original, but
all counterparts together will constitute one and the same agreement.
15. DISPUTED OBLIGATIONS. ALL COMMUNICATIONS CONCERNING DISPUTED DEBTS AND
--------------------
OBLIGATIONS OF GUARANTOR UNDER THIS GUARANTY, INCLUDING WITHOUT LIMITATION
DISPUTES AS TO THE AMOUNT OF ANY PAYMENT, FEE OR CHARGE, AND INCLUDING AN
INSTRUMENT TENDERED AS FULL SATISFACTION OF A DISPUTED DEBT, MUST BE IN WRITING
AND MUST BE SENT TO THE FOLLOWING ADDRESS, OR TO SUCH OTHER ADDRESS AS LENDER
MAY HEREAFTER SPECIFY:
BANK OF AMERICA NT & SA
ATTENTION: COMMERCIAL MORTGAGE LOAN SERVICING MANAGER
000 X. XXXXXXX, 00XX XXXXX
XXX XXXXXXX, XX 00000
ANY SUCH COMMUNICATION SHOULD INCLUDE THE NAME OF GUARANTOR, THE APPLICABLE LOAN
NUMBER, A DESCRIPTION OF THE DISPUTE AND THE RELIEF OR REMEDY REQUESTED, AND AN
ADDRESS AND TELEPHONE NUMBER WHERE THE PERSON SENDING THE NOTICE CAN BE
CONTACTED.
NOTICES:
A. THIS GUARANTY AGREEMENT RESULTS IN YOUR WAIVER OF CERTAIN LEGAL RIGHTS AND
DEFENSES, INCLUDING WITHOUT LIMITATION YOUR SUBROGATION RIGHTS AND ANY DEFENSES
BASED ON THE WASHINGTON ANTI-DEFICIENCY JUDGMENT STATUTE, RCW 61.24.100, AND ANY
DEFENSES BASED ON THE LENDER'S ELECTION OF REMEDIES. IT IS RECOMMENDED THAT YOU
CONSULT YOUR OWN ATTORNEY BEFORE ENTERING INTO THIS AGREEMENT.
-5-
B. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FOREBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON
LAW.
GUARANTOR:
ATL ULTRASOUND, INC., a Washington
corporation
By /s/ Xxxxxx X. Xxxxxx
____________________________________
Its Sr. V.P., Finance and Admin., CFO
____________________________________
Address for Notices:
________________________________
________________________________
-6-
STATE OF WASHINGTON )
) ss.
COUNTY OF SNOHOMISH )
On this 16th day of June, 1998, before me, the undersigned, a Notary Public in
and for the State of Washington, duly commissioned and sworn personally appeared
Xxxxxx X. Xxxxxx, known to me to be the Sr. V.P. & CFO of ATL ULTRASOUND, INC.,
the corporation that executed the foregoing instrument, and acknowledged the
said instrument to be the free and voluntary act and deed of said corporation,
for the purposes therein mentioned, and on oath stated that he/she was
authorized to execute said instrument.
I certify that I know or have satisfactory evidence that the person appearing
before me and making this acknowledgment is the person whose true signature
appears on this document.
WITNESS my hand and official seal hereto affixed the day and year in the
certificate above written.
/s/ Xxxxx X. Xxxxx
-------------------------------------
Signature
Xxxxx X. Xxxxx
-------------------------------------
Print Name
NOTARY PUBLIC in and for the State of
Washington, residing at Seattle.
My commission expires 6/15/99.
-7-
