Exhibit 10.6
FORM OF NON-SHARED GUARANTY
Dated as of August 15, 2001
From
THE GUARANTORS NAMED HEREIN
and
THE ADDITIONAL GUARANTORS REFERRED TO HEREIN
as Guarantors
in favor of
THE SECURED PARTIES REFERRED TO HEREIN
TABLE OF CONTENTS
Section Page
Section 1. Guaranty; Limitation of Liability...............................1
Section 2. Guaranty Absolute...............................................2
Section 3. Waivers and Acknowledgments.....................................3
Section 4. Subrogation.....................................................4
Section 5. Payments Free and Clear of Taxes, Etc...........................5
Section 6. Representations and Warranties..................................7
Section 7. Covenants.......................................................7
Section 8. Amendments, Non-Shared Guaranty Supplements, Etc................7
Section 9. Notices, Etc....................................................7
Section 10. No Waiver; Remedies.............................................8
Section 11. Right of Set-off................................................8
Section 12. Indemnification.................................................8
Section 13. Subordination...................................................9
Section 14. Continuing Guaranty; Assignments under the Bank Facilities......9
Section 15. Release of Shared Collateral Loan Parties.......................10
Section 16. Execution in Counterparts.......................................10
Section 17. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc..........10
Exhibit A - Non-Shared Guaranty Supplement
NON-SHARED GUARANTY
NON-SHARED GUARANTY dated as of August __, 2001 made by the Persons listed
on the signature pages hereof under the caption "Guarantors" and the Additional
Guarantors (as defined in Section 8(b)) (such Persons so listed and the
Additional Guarantors being, collectively, the "Guarantors" and, individually,
each a "Guarantor") in favor of the Secured Parties (as defined below).
PRELIMINARY STATEMENT. U.S. Industries, Inc., a Delaware corporation
("USI"), the Guarantors and certain other subsidiaries of USI are party to an
Amendment, Restatement, General Provisions and Intercreditor Agreement dated as
of August 15, 2001 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the "Master Agreement"; the capitalized terms
defined therein and not otherwise defined herein being used herein as therein
defined) with the Banks party thereto, WILMINGTON TRUST COMPANY, as Corporate
Trustee, and XXXXX X. XXXXXXXX, as Individual Trustee and together with
Wilmington Trust Company, as Collateral Trustees and BANK OF AMERICA, N.A., as
Rexair Collateral Agent, 364-Day Agent, 5-Year Agent, Rexair Agent and as Debt
Coordinator. It is a condition precedent to the closing of the Master
Agreement, the issuance of Letters of Credit and the making of other extensions
of credit and/or the provision of services under the Master Agreement that each
Guarantor shall have executed and delivered this Guaranty. As used in the
Guaranty, the term "Secured Parties" means the Secured Holders other than the
Noteholders and their Representatives (each as defined in the Collateral Trust
Agreement).
NOW, THEREFORE, in consideration of the premises, each Guarantor, jointly
and severally with each other Guarantor, hereby agrees as follows:
Section 1. Guaranty; Limitation of Liability. (a) Each Guarantor hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment
when due, whether at scheduled maturity or on any date of a required prepayment
or by acceleration, demand or otherwise, of all Obligations of each other Loan
Party now or hereafter existing under or in respect of the Transaction
Documents (including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing
Obligations), whether direct or indirect, absolute or contingent, and whether
for principal, interest, premiums, fees, indemnities, contract causes of
action, costs, expenses or otherwise (such Obligations being the "Guaranteed
Obligations"), and agrees to pay any and all expenses (including, without
limitation, reasonable fees and expenses of counsel) incurred by the Collateral
Trustees, the Debt Coordinator or any other Secured Party in enforcing any
rights under this Guaranty or any other Transaction Document. Without limiting
the generality of the foregoing, each Guarantor's liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
any other Loan Party to any Secured Party under or in respect of the
Transaction Documents but for the fact that they are unenforceable or not
allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.
(b) Each Guarantor, and by its acceptance of this Guaranty, the Debt
Coordinator and each other Secured Party, hereby confirms that it is the
intention of all such Persons that this Guaranty and the Obligations of each
Guarantor hereunder not constitute a
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fraudulent transfer or conveyance for purposes of Bankruptcy Law (as
hereinafter defined), the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state law to the
extent applicable to this Guaranty and the Obligations of each Guarantor
hereunder. To effectuate the foregoing intention, the Debt Coordinator, the
other Secured Parties and the Guarantors hereby irrevocably agree that the
Obligations of each Guarantor under this Guaranty at any time shall be limited
to the maximum amount as will result in the Obligations of such Guarantor under
this Guaranty not constituting a fraudulent transfer or conveyance. For
purposes hereof, "Bankruptcy Law" means any proceeding of the type referred to
in Section 7.01(f) of the Master Agreement or Title 11, U.S. Code, or any
similar foreign, federal or state law for the relief of debtors.
(c) Each Guarantor hereby unconditionally and irrevocably agrees that in
the event any payment shall be required to be made to any Secured Party under
this Guaranty, such Guarantor will contribute, to the maximum extent permitted
by law, such amounts to each other Guarantor and each other guarantor so as to
maximize the aggregate amount paid to the Secured Parties under or in respect
of the Transaction Documents.
Section 2. Guaranty Absolute. Each Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of
the Transaction Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Secured Party with respect thereto. The Obligations of each
Guarantor under or in respect of this Guaranty are independent of the
Guaranteed Obligations or any other Obligations of any other Loan Party under
or in respect of the Transaction Documents, and a separate action or actions
may be brought and prosecuted against each Guarantor to enforce this Guaranty,
irrespective of whether any action is brought against USI or any other Loan
Party or whether USI or any other Loan Party is joined in any such action or
actions. The liability of each Guarantor under this Guaranty shall be
irrevocable, absolute and unconditional irrespective of, and each Guarantor
hereby irrevocably waives any defenses it may now have or hereafter acquire in
any way relating to, any or all of the following:
(a) any lack of validity or enforceability of any Transaction
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations or any other
Obligations of any other Loan Party under or in respect of the Transaction
Documents, or any other amendment or waiver of or any consent to departure
from any Transaction Document, including, without limitation, any increase
in the Guaranteed Obligations resulting from the extension of additional
credit to any Loan Party or any of its Subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any Collateral
or any other collateral, or any taking, release or amendment or waiver of,
or consent to departure from, any other guaranty, for all or any of the
Guaranteed Obligations;
(d) any manner of application of Collateral or any other collateral,
or proceeds thereof, to all or any of the Guaranteed Obligations, or any
manner of sale or other disposition of any Collateral or any other
collateral for all or any of the Guaranteed
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Obligations or any other Obligations of any Loan Party under the
Transaction Documents or any other assets of any Loan Party or any of its
Subsidiaries;
(e) any change, restructuring or termination of the corporate
structure or existence of any Loan Party or any of its Subsidiaries;
(f) any failure of any Secured Party to disclose to any Loan Party
any information relating to the business, condition (financial or
otherwise), operations, performance, properties or prospects of any other
Loan Party now or hereafter known to such Secured Party (each Guarantor
waiving any duty on the part of the Secured Parties to disclose such
information);
(g) the failure of any other Person to execute or deliver this
Guaranty, any Guaranty Supplement (as hereinafter defined), other Guaranty
or any other guaranty or agreement or the release or reduction of
liability of any Guarantor or other guarantor or surety with respect to
the Guaranteed Obligations; or
(h) any other circumstance (including, without limitation, any
statute of limitations) or any existence of or reliance on any
representation by any Secured Party that might otherwise constitute a
defense available to, or a discharge of, any Loan Party or any other
guarantor or surety.
This Guaranty shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is
rescinded or must otherwise be returned by any Secured Party or any other
Person upon the insolvency, bankruptcy or reorganization of USI or any other
Loan Party or otherwise, all as though such payment had not been made.
Section 3. Waivers and Acknowledgments. (a) Each Guarantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Guaranteed Obligations and this Guaranty and any requirement that
any Secured Party protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Loan Party
or any other Person or any Collateral.
(b) Each Guarantor hereby unconditionally and irrevocably waives any right
to revoke this Guaranty and acknowledges that this Guaranty is continuing in
nature and applies to all Guaranteed Obligations, whether existing now or in
the future.
(c) Each Guarantor hereby unconditionally and irrevocably waives (i) any
defense arising by reason of any claim or defense based upon an election of
remedies by any Secured Party that in any manner impairs, reduces, releases or
otherwise adversely affects the subrogation, reimbursement, exoneration,
contribution or indemnification rights of such Guarantor or other rights of
such Guarantor to proceed against any of the other Loan Parties, any other
guarantor or any other Person or any Collateral and (ii) any defense based on
any right of set-off or counterclaim against or in respect of the Obligations
of such Guarantor hereunder.
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(d) Each Guarantor acknowledges that the Collateral Trustees may, without
notice to or demand upon such Guarantor and without affecting the liability of
such Guarantor under this Guaranty, foreclose under any mortgage by nonjudicial
sale, and each Guarantor hereby waives any defense to the recovery by the
Collateral Trustees and the other Secured Parties against such Guarantor of any
deficiency after such nonjudicial sale and any defense or benefits that may be
afforded by applicable law.
(e) Each Guarantor hereby unconditionally and irrevocably waives any duty
on the part of any Secured Party to disclose to such Guarantor any matter, fact
or thing relating to the business, condition (financial or otherwise),
operations, performance, properties or prospects of any other Loan Party or any
of its Subsidiaries now or hereafter known by such Secured Party.
(f) Each Guarantor acknowledges that it will receive substantial direct
and indirect benefits from the financing arrangements contemplated by the
Transaction Documents and that the waivers set forth in Section 2 and this
Section 3 are knowingly made in contemplation of such benefits.
Section 4. Subrogation. Each Guarantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against USI, any other Loan Party or any other insider guarantor that
arise from the existence, payment, performance or enforcement of such
Guarantor's Obligations under or in respect of this Guaranty or any other
Transaction Document, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of any Secured Party against USI, any other
Loan Party or any other insider guarantor or any Collateral, whether or not
such claim, remedy or right arises in equity or under contract, statute or
common law, including, without limitation, the right to take or receive from
USI, any other Loan Party or any other insider guarantor, directly or
indirectly, in cash or other property or by set-off or in any other manner,
payment or security on account of such claim, remedy or right, unless and until
all of the Guaranteed Obligations and all other amounts payable under this
Guaranty shall have been paid in full in cash, all Letters of Credit and all
Secured Hedge Agreements shall have expired or been terminated and all
Commitments in respect of Bank Exposure shall have expired or been terminated.
If any amount shall be paid to any Guarantor in violation of the immediately
preceding sentence at any time prior to the latest of (a) the payment in full
in cash of the Guaranteed Obligations and all other amounts payable under this
Guaranty, (b) the Maturity Date and (c) the latest date of expiration or
termination of all Letters of Credit and all Secured Hedge Agreements, such
amount shall be received and held in trust for the benefit of the Secured
Parties, shall be segregated from other property and funds of such Guarantor
and shall forthwith be paid or delivered to the Debt Coordinator in the same
form as so received (with any necessary endorsement or assignment) to be
credited and applied to the Guaranteed Obligations and all other amounts
payable under this Guaranty, whether matured or unmatured, in accordance with
the terms of the Transaction Documents, or to be held as Collateral for any
Guaranteed Obligations or other amounts payable under this Guaranty thereafter
arising. If (i) any Guarantor shall make payment to any Secured Party of all or
any part of the Guaranteed Obligations, (ii) all of the Guaranteed Obligations
and all other amounts payable under this Guaranty shall have been paid in full
in cash, (iii) the Maturity Date shall have occurred and (iv) all Letters of
Credit and all Secured Hedge Agreements shall have
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expired or been terminated, the Secured Parties will, at such Guarantor's
request and expense, execute and deliver to such Guarantor appropriate
documents, without recourse and without representation or warranty, necessary
to evidence the transfer by subrogation to such Guarantor of an interest in the
Guaranteed Obligations resulting from such payment made by such Guarantor
pursuant to this Guaranty.
Section 5. Payments Free and Clear of Taxes, Etc. (a) Any and all payments
by each Guarantor under or in respect of the Transaction Documents shall be
made free and clear of, and without deduction for, any and all present or
future Taxes. If any Guarantor shall be required by law to deduct any Taxes
from or in respect of any sum payable under or in respect of the Transaction
Documents to any Secured Party, (i) the sum payable by such Guarantor shall be
increased as may be necessary so that, after such Guarantor, any applicable
Secured Party has made all required deductions (including deductions applicable
to additional sums payable under this Section 5), such Secured Party receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) such Guarantor shall make all such deductions and (iii) such
Guarantor shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law.
(b) In addition, each Guarantor agrees to pay any present or future Other
Taxes that arise from any payment made by or on behalf of such Guarantor under
or in respect of this Guaranty or any other Transaction Document or from the
execution, delivery or registration of, performance under, or otherwise with
respect to, this Guaranty and the other Transaction Documents.
(c) Each Guarantor will indemnify each Secured Party for and hold it
harmless against the full amount of Taxes and Other Taxes, and for the full
amount of taxes of any kind imposed by any jurisdiction on amounts payable
under this Section 5, imposed on or paid by such Secured Party and any
liability (including penalties, additions to tax, interest and expenses)
arising therefrom or with respect thereto. This indemnification shall be made
within 30 days from the date such Secured Party makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes by or on behalf
of any Guarantor, such Guarantor shall furnish to the Debt Coordinator, at its
address referred to in Section 9, the original or a certified copy of a receipt
evidencing such payment. In the case of any payment hereunder by or on behalf
of any Guarantor through an account or branch outside the United States or by
or on behalf of such Guarantor by a payor that is not a United States person,
if such Guarantor determines that no Taxes are payable in respect thereof, such
Guarantor shall furnish, or shall cause such payor to furnish, to the Debt
Coordinator, at such address, an opinion of counsel reasonably acceptable to
the Debt Coordinator stating that such payment is exempt from Taxes. For
purposes of subsections (d) and (e) of this Section 5, the terms "United
States" and "United States person" shall have the meanings specified in Section
7701 of the Internal Revenue Code.
(e) Upon the reasonable request in writing of any Guarantor, each Secured
Party organized under the laws of a jurisdiction outside the United States
shall, on or prior to the date of its execution and delivery of this Agreement
in the case of each Bank party hereto on the Effective Date and on the date of
the assignment pursuant to which it becomes a Secured Party in
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the case of each other Secured Party, and from time to time thereafter as
requested in writing by USI (but only so long thereafter as such Secured Party
remains lawfully able to do so), provide each of the Debt Coordinator and USI
with two original Internal Revenue Service forms W-8BEN or W-8ECI or, in the
case of a Secured Party that has certified in writing to the Debt Coordinator
that it is not a "bank" as defined in Section 881(c)(3)(A) of the Code, is not
a 10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the
Code) of USI and is not a controlled foreign corporation related to USI (within
the meaning of Section 864(d)(4) of the Code), Internal Revenue Service Form
W-8BEN, as appropriate, or any successor or other form prescribed by the
Internal Revenue Service, certifying that such Secured Party is exempt from or
entitled to a reduced rate of United States withholding tax on payments
pursuant to the Transaction Documents or, in the case of a Secured Party
providing a form W-8BEN, certifying that such Bank is a foreign corporation,
partnership, estate or trust. If the forms provided by a Secured Party at the
time such Secured Party first becomes a party to the Master Agreement indicate
a United States interest withholding tax rate in excess of zero, withholding
tax at such rate shall be considered excluded from Taxes unless and until such
Secured Party provides the appropriate forms certifying that a lesser rate
applies, whereupon withholding tax at such lesser rate only shall be considered
excluded from Taxes for periods governed by such forms; provided, however, that
if, at the effective date of the assignment pursuant to which a Secured Party
becomes a party to the Master Agreement, the Secured Party assignor was
entitled to payments under subsection (a) of this Section 5 in respect of
United States withholding tax with respect to interest paid at such date, then,
to such extent, the term "Taxes" shall include (in addition to withholding
taxes that may be imposed in the future or other amounts otherwise includable
in Taxes) United States withholding tax, if any, applicable with respect to the
Secured Party assignee on such date. If any form or document referred to in
this subsection (e) requires the disclosure of information, other than
information necessary to compute the tax payable and information required on
the date hereof by Internal Revenue Service form W-8BEN or W-8ECI (or the
certificate described above), that the applicable Secured Party reasonably
considers to be confidential, such Secured Party shall give notice thereof to
USI and shall not be obligated to include in such form or document such
confidential information.
(f) For any period with respect to which a Secured Party has failed to
provide any Guarantor following such Guarantor's request therefor pursuant to
subsection (e) above with the appropriate form described in subsection (e)
above (other than if such failure is due to a change in law occurring after the
date on which a form originally was required to be provided or if such form
otherwise is not required under subsection (e) above), such Secured Party shall
not be entitled to indemnification under subsection (a) or (c) of this Section
5 with respect to Taxes imposed by the United States by reason of such failure;
provided, however, that should a Secured Party become subject to Taxes because
of its failure to deliver a form required hereunder, such Guarantor shall take
such steps as such Secured Party shall reasonably request to assist such
Secured Party to recover such Taxes.
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Section 6. Representations and Warranties. Each Guarantor hereby makes
each representation and warranty made in the Transaction Documents by USI with
respect to such Guarantor and each Guarantor hereby further represents and
warrants that there are no conditions precedent to the effectiveness of this
Guaranty that have not been satisfied or waived.
Section 7. Covenants. Each Guarantor covenants and agrees that, so long as
any part of the Guaranteed Obligations shall remain unpaid, any Letter of
Credit shall be outstanding, any Bank shall have any Commitment or any Secured
Hedge Agreement shall be in effect, such Guarantor will perform and observe,
and cause each of its Subsidiaries to perform and observe, all of the terms,
covenants and agreements set forth in the Transaction Documents on its or their
part to be performed or observed or that USI has agreed to cause such Guarantor
or such Subsidiaries to perform or observe.
Section 8. Amendments, Non-Shared Guaranty Supplements, Etc. (a) No
amendment or waiver of any provision of this Guaranty and no consent to any
departure by any Guarantor therefrom shall in any event be effective unless the
same shall be in writing and signed by the Debt Coordinator and the Majority
Banks, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. Upon the sale of a
Guarantor to the extent permitted in accordance with the terms of the
Transaction Documents, such Guarantor shall be automatically released from this
Guaranty.
(b) Upon the execution and delivery by any Person of a guaranty supplement
in substantially the form of Exhibit A hereto (each, a "Non-Shared Guaranty
Supplement"), (i) such Person shall be referred to as an "Additional Guarantor"
and shall become and be a Guarantor hereunder, and each reference in this
Non-Shared Guaranty to a "Guarantor" shall also mean and be a reference to such
Additional Guarantor, and each reference in any other Transaction Document to a
"Guarantor" or "Non-Shared Guarantor" shall also mean and be a reference to
such Additional Guarantor, and (ii) each reference herein to "this Guaranty",
"hereunder", "hereof" or words of like import referring to this Guaranty, and
each reference in any other Transaction Document to the "Non-Shared Guaranty",
"thereunder", "thereof" or words of like import referring to this Guaranty,
shall mean and be a reference to this Non-Shared Guaranty as supplemented by
such Non-Shared Guaranty Supplement.
Section 9. Notices, Etc. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telecopy or telex
communication) and mailed, telegraphed, telecopied, telexed or delivered to it,
if to any Guarantor, addressed to it in care of USI at USI's address specified
in Section 11.01 of the Master Agreement, if to the Debt Coordinator or any
Bank, at its address as specified in Section 11.01 of the Master Agreement, or,
as to any party, at such other address as shall be designated by such party in
a written notice to each other party. All such notices and other communications
shall, when mailed, telegraphed, telecopied or telexed, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier or confirmed by telex answerback, respectively. Delivery by
telecopier of an executed counterpart of a signature page to any amendment or
waiver of any provision of this Guaranty or of any Non-Shared Guaranty
Supplement to be executed and delivered hereunder shall be effective as
delivery of an original executed counterpart thereof.
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Section 10. No Waiver; Remedies. No failure on the part of any Secured
Party to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
Section 11. Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent specified by Section 7.01 of the Master Agreement to
authorize the Debt Coordinator to declare all amounts payable under all Bank
Facilities pursuant to the provisions of said Section 7.01, the Debt
Coordinator and each Bank and each of their respective Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by the Debt Coordinator, such Bank or such Affiliate to or for the
credit or the account of any Guarantor against any and all of the Obligations
of such Guarantor now or hereafter existing under the Transaction Documents,
irrespective of whether the Debt Coordinator or such Bank shall have made any
demand under this Guaranty or any other Transaction Document and although such
Obligations may be unmatured. The Debt Coordinator and each Bank agrees
promptly to notify such Guarantor after any such set-off and application;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Debt Coordinator
and each Bank and their respective Affiliates under this Section are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) that the Debt Coordinator, such Bank and their respective
Affiliates may have.
Section 12. Indemnification. (a) Without limitation on any other
Obligations of any Guarantor or remedies of the Secured Parties under this
Guaranty, each Guarantor shall, to the fullest extent permitted by law,
indemnify, defend and save and hold harmless each Secured Party and each of
their Affiliates and their respective officers, directors, employees, agents
and advisors (each, an "Indemnified Party") from and against, and shall pay on
demand, any and all claims, damages, losses, liabilities and expenses
(including, without limitation, reasonable fees and expenses of counsel) that
may be incurred by or asserted or awarded against any Indemnified Party in
connection with or as a result of any failure of any Guaranteed Obligations to
be the legal, valid and binding obligations of any Loan Party enforceable
against such Loan Party in accordance with their terms.
(b) Each Guarantor hereby also agrees that none of the Indemnified Parties
shall have any liability (whether direct or indirect, in contract, tort or
otherwise) to any of the Guarantors or any of their respective Affiliates or
any of their respective officers, directors, employees, agents and advisors,
and each Guarantor hereby agrees not to assert any claim against any
Indemnified Party on any theory of liability, for special, indirect,
consequential or punitive damages arising out of or otherwise relating to the
Facilities, the actual or proposed use of the proceeds of the Loans, the
Letters of Credit or other extensions of Credit, the Transaction Documents or
any of the transactions contemplated by the Transaction Documents.
(c) Without prejudice to the survival of any of the other agreements of
any Guarantor under this Guaranty or any of the other Transaction Documents,
the agreements and
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obligations of each Guarantor contained in Section 1(a) (with respect to
enforcement expenses), the last sentence of Section 2, Section 5 and this
Section 12 shall survive the payment in full of the Guaranteed Obligations and
all of the other amounts payable under this Guaranty.
Section 13. Subordination. Upon the occurrence and during the continuance
of a Default under Section 7.01(f) of the Master Agreement, each Guarantor
hereby agrees to subordinate any and all debts, liabilities and other
Obligations owed to such Guarantor by each other Loan Party (the "Subordinated
Obligations") to the Guaranteed Obligations to the extent and in the manner
hereinafter set forth in this Section 13:
(a) Prohibited Payments, Etc. No Guarantor shall demand, accept or
take any action to collect any payment on account of the Subordinated
Obligations.
(b) Prior Payment of Guaranteed Obligations. In any proceeding under
any Bankruptcy Law relating to any other Loan Party, each Guarantor agrees
that the Secured Parties shall be entitled to receive payment in full in
cash of all Guaranteed Obligations (including all interest and expenses
accruing after the commencement of a proceeding under any Bankruptcy Law,
whether or not constituting an allowed claim in such proceeding ("Post
Petition Interest")) before such Guarantor receives payment of any
Subordinated Obligations.
(c) Turn-Over. Each Guarantor shall, if the Debt Coordinator so
requests, collect, enforce and receive payments on account of the
Subordinated Obligations as trustee for the Secured Parties and deliver
such payments to the Collateral Trustees on account of the Guaranteed
Obligations (including all Post Petition Interest), together with any
necessary endorsements or other instruments of transfer, but without
reducing or affecting in any manner the liability of such Guarantor under
the other provisions of this Guaranty.
(d) Debt Coordinator Authorization. The Debt Coordinator is
authorized and empowered (but without any obligation to so do), in its
discretion, (i) in the name of each Guarantor, to collect and enforce, and
to submit claims in respect of, Subordinated Obligations and to apply any
amounts received thereon to the Guaranteed Obligations (including any and
all Post Petition Interest), and (ii) to require each Guarantor (A) to
collect and enforce, and to submit claims in respect of, Subordinated
Obligations and (B) to pay any amounts received on such obligations to the
Debt Coordinator for application to the Guaranteed Obligations (including
any and all Post Petition Interest).
Section 14. Continuing Guaranty; Assignments under the Bank Facilities.
This Guaranty is a continuing guaranty and shall (a) remain in full force and
effect until the latest of (i) the payment in full in cash of the Guaranteed
Obligations and all other amounts payable under this Guaranty, (ii) the
Maturity Date and (iii) the latest date of expiration or termination of all
Letters of Credit and all Secured Hedge Agreements, (b) be binding upon the
Guarantor, its successors and assigns and (c) inure to the benefit of and be
enforceable by the Secured Parties and their successors, transferees and
assigns. Without limiting the generality of clause (c) of the immediately
preceding sentence, any Secured Party may assign or otherwise transfer all or
any portion of its rights and obligations under any Bank Facility to which it
is a party to any other
10
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to such Secured Party herein or otherwise,
in each case as and to the extent provided in such Bank Facility. No Guarantor
shall have the right to assign its rights hereunder or any interest herein
without the prior written consent of the Secured Parties.
Section 15. Release of Shared Collateral Loan Parties. Notwithstanding any
contrary provision of this Guaranty, if any Guarantor shall become, or shall be
determined by a court of competent jurisdiction to be, a Shared Collateral Loan
Party, such Guarantor shall be, concurrently with the occurrence of such event,
automatically released from this Guaranty; provided, however, that if any Loan
Party that was, at any time, released as a Guarantor pursuant to this Section
15 shall subsequently become a Non-Shared Collateral Loan Party, such Loan
Party shall, concurrently with its becoming a Non-Shared Collateral Loan Party,
automatically be reinstated as a Guarantor hereunder.
Section 16. Execution in Counterparts. This Guaranty and each amendment,
waiver and consent with respect hereto may be executed in any number of
counterparts and by different parties thereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Guaranty by telecopier shall be
effective as delivery of an original executed counterpart of this Guaranty.
Section 17. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a)
This Guaranty shall be governed by, and construed in accordance with, the laws
of the State of New York.
(b) Each Guarantor hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Guaranty or any of the other Transaction
Documents to which it is or is to be a party, or for recognition or enforcement
of any judgment, and each Guarantor hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in any such New York State court or, to the extent permitted by
law, in such federal court. Each Guarantor 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 Guaranty or any other Transaction Document shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this Guaranty or any other Transaction Document in the courts of
any jurisdiction.
(c) Each Guarantor irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Guaranty or any of the other Transaction Documents
to which it is or is to be a party in any New York State or federal court. Each
Guarantor hereby irrevocably waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such suit, action or
proceeding in any such court.
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(d) EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE TRANSACTION DOCUMENTS, THE
ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
[NAME OF GUARANTOR]
By /s/
-----------------------------------
Title:
[NAME OF GUARANTOR]
By /s/
-----------------------------------
Title:
Etc.
Exhibit A
To
Non-Shared Guaranty
FORM OF NON-SHARED GUARANTY SUPPLEMENT
--------- --, ----
Bank of America, N.A., as Debt Coordinator
000 Xxxxxxx Xxxxxx
Xxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: _________
Master Agreement dated as of August 15, 2001 among U.S. Industries, Inc., a
Delaware corporation ("USI") and certain of its Subsidiaries, the Banks party
thereto, WILMINGTON TRUST COMPANY, as Corporate Trustee, and XXXXX X. XXXXXXXX,
as Individual Trustee and together with Wilmington Trust Company, as Collateral
Trustees and BANK OF AMERICA, N.A., as Rexair Collateral Agent, 364-Day Agent,
5-Year Agent, Rexair Agent and as Debt Coordinator
Ladies and Gentlemen:
Reference is made to the above-captioned Master Agreement and to the
Non-Shared Guaranty referred to therein (such Non-Shared Guaranty, as in effect
on the date hereof and as it may hereafter be amended, supplemented or
otherwise modified from time to time, together with this Non-Shared Guaranty
Supplement, being the "Non-Shared Guaranty"). The capitalized terms defined in
the Non-Shared Guaranty or in the Master Agreement and not otherwise defined
herein are used herein as therein defined.
Section 1. Guaranty; Limitation of Liability. (a) The undersigned hereby
absolutely, unconditionally and irrevocably guarantees the punctual payment
when due, whether at scheduled maturity or on any date of a required prepayment
or by acceleration, demand or otherwise, of all Obligations of each other Loan
Party now or hereafter existing under or in respect of the Transaction
Documents (including, without limitation, any extensions, modifications,
substitutions, amendments or renewals of any or all of the foregoing
Obligations), whether direct or indirect, absolute or contingent, and whether
for principal, interest, premium, fees, indemnities, contract causes of action,
costs, expenses or otherwise (such Obligations being the "Guaranteed
Obligations"), and agrees to pay any and all expenses (including, without
limitation, fees and reasonable expenses of counsel) incurred by the Collateral
Trustees, the Debt Coordinator or any other Secured Party in enforcing any
rights under this Non-Shared Guaranty
2
Supplement, the Non-Shared Guaranty or any other Transaction Document. Without
limiting the generality of the foregoing, the undersigned's liability shall
extend to all amounts that constitute part of the Guaranteed Obligations and
would be owed by any other Loan Party to any Secured Party under or in respect
of the Transaction Documents but for the fact that they are unenforceable or
not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving such other Loan Party.
(b) The undersigned, and by its acceptance of this Non-Shared Guaranty
Supplement, the Debt Coordinator and each other Secured Party, hereby confirms
that it is the intention of all such Persons that this Non-Shared Guaranty
Supplement, the Non-Shared Guaranty and the Obligations of the undersigned
hereunder and thereunder not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar foreign, federal or state law to the
extent applicable to this Non-Shared Guaranty Supplement, the Non-Shared
Guaranty and the Obligations of the undersigned hereunder and thereunder. To
effectuate the foregoing intention, the Debt Coordinator, the other Secured
Parties and the undersigned hereby irrevocably agree that the Obligations of
the undersigned under this Non-Shared Guaranty Supplement and the Non-Shared
Guaranty at any time shall be limited to the maximum amount as will result in
the Obligations of the undersigned under this Non-Shared Guaranty Supplement
and the Non-Shared Guaranty not constituting a fraudulent transfer or
conveyance.
(c) The undersigned hereby unconditionally and irrevocably agrees that in
the event any payment shall be required to be made to any Secured Party under
this Non-Shared Guaranty Supplement, the Non-Shared Guaranty, the undersigned
will contribute, to the maximum extent permitted by applicable law, such
amounts to each other Guarantor and each other guarantor so as to maximize the
aggregate amount paid to the Secured Parties under or in respect of the
Transaction Documents.
Section 2. Obligations Under the Non-Shared Guaranty. The undersigned
hereby agrees, as of the date first above written, to be bound as a Guarantor
by all of the terms and conditions of the Non-Shared Guaranty to the same
extent as each of the other Guarantors thereunder. The undersigned further
agrees, as of the date first above written, that each reference in the
Non-Shared Guaranty to an "Additional Guarantor" or a "Guarantor" shall also
mean and be a reference to the undersigned, and each reference in any other
Transaction Document to a "Guarantor", "Non-Shared Guarantor", "Non-Shared
Collateral Loan Party" or a "Loan Party" shall also mean and be a reference to
the undersigned.
Section 3. Representations and Warranties. The undersigned hereby makes
each representation and warranty set forth in Section 6 of the Non-Shared
Guaranty to the same extent as each other Guarantor.
Section 4. Delivery by Telecopier. Delivery of an executed counterpart of
a signature page to this Non-Shared Guaranty Supplement by telecopier shall be
effective as delivery of an original executed counterpart of this Non-Shared
Guaranty Supplement.
3
Section 5. Governing Law; Jurisdiction; Waiver of Jury Trial, Etc. (a)
This Non-Shared Guaranty Supplement shall be governed by, and construed in
accordance with, the laws of the State of New York.
(b) The undersigned hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of any New York State
court or any federal court of the United States of America sitting in New York
City, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Non-Shared Guaranty Supplement, the
Non-Shared Guaranty or any of the other Transaction Documents to which it is or
is to be a party, or for recognition or enforcement of any judgment, and the
undersigned hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in any
such New York State court or, to the extent permitted by law, in such federal
court. The undersigned 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
Non-Shared Guaranty Supplement or the Non-Shared Guaranty or any other
Transaction Document shall affect any right that any party may otherwise have
to bring any action or proceeding relating to this Non-Shared Guaranty
Supplement, the Non-Shared Guaranty or any of the other Transaction Documents
to which it is or is to be a party in the courts of any other jurisdiction.
(c) The undersigned irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Non-Shared Guaranty Supplement, the Non-Shared
Guaranty or any of the other Transaction Documents to which it is or is to be a
party in any New York State or federal court. The undersigned hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such suit, action or proceeding in any
such court.
(d) THE UNDERSIGNED HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO ANY OF THE TRANSACTION DOCUMENTS, THE
ADVANCES OR THE ACTIONS OF ANY SECURED PARTY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.
Very truly yours,
[NAME OF ADDITIONAL GUARANTOR]
By /s/
-----------------------------------
Title:
