EXHIBIT 10.2
LIMITED GUARANTY
THIS LIMITED GUARANTY (this "Guaranty") is made as of the 1st day of
October, 1996, by XXXXXX OCEANICS, INC., a Texas corporation (the "Guarantor"),
in favor of THE CHASE MANHATTAN BANK, as agent ("Agent") for the Banks parties
to the Loan Agreement described below.
RECITALS
X. Xxxxxx Deep Seas, Ltd., a Texas limited partnership (the "Borrower"),
has asked the Banks for certain waivers and consents concerning that
certain Term Loan (the "Loan") described in and to be made pursuant to
the terms and conditions of the Second Amended and Restated Master
Loan Restructuring Agreement, dated March 31, 1995 as amended by the
First Amendment thereto dated as of November 28, 1995 (as further
amended, substituted and restated from time to time, the "Loan
Agreement").
B. The Guarantor has requested the Banks to grant the waivers and
consents concerning the Loan to the Borrower pursuant to the Loan
Agreement and that certain Limited Waiver and Consent ("Limited
Waiver") dated of even date herewith.
C. It is a condition precedent, among others, to the Banks' consideration
of the Borrower's request for the waivers and consents regarding the
Loan set forth in that certain Limited Waiver that the Guarantor enter
into this Guaranty in order to guarantee the full and prompt payment
and performance by the Borrower of the Obligations (as defined below).
D. All capitalized terms that are used, but are not otherwise defined
herein, shall have the meanings ascribed to them in the Loan
Agreement.
E. In granting the waivers and consents set forth in the Limited Waiver,
each Bank is relying upon the agreements of the Guarantor, as set
forth in this Guaranty.
NOW THEREFORE, in consideration of the Banks' agreement to execute the
Limited Waiver and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the
Guarantor, the Guarantor agrees with Agent as follows:
1. Unconditional Guaranty. The Guarantor hereby unconditionally and
irrevocably guarantees to Agent for the ratable benefit of the
Banks and their respective successors and assigns the following:
(a) The due and punctual repayment, whether at stated maturity,
by acceleration or otherwise) in full (and not merely the
collection) of (1) the sum of the principal payments due to
each Bank under Section 3.1 of the Loan Agreement (as
modified by the Limited Waiver and Consent thereto dated the
date hereof) during the period commencing October 1, 1996
and ending December 31, 1997 pursuant to each of the
Borrower's Term Notes and the interest thereon, ("1997
Principal") and (2) any other obligations of Borrower to the
Banks, or any of them, under the Restructuring Documents, to
pay the 1997 Principal including, without limitation, late
charges, penalties, enforcement costs, indemnification
obligations and attorneys' fees specifically relating to the
payment or collection of the 1997 Principal (collectively,
the "Obligations"); in each case when due and payable,
whether on demand, on any installment payment date or at the
stated or accelerated maturity.
2. Primary Liability.
(a) The obligations and liabilities of the Guarantor under this
Guaranty are primary, direct, absolute, unlimited,
continuing, irrevocable and immediate and not conditional or
contingent upon the pursuit by Agent or any Bank of any
rights or remedies it may have against the Borrower or any
person or entity
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otherthan the Borrower who may now or at any time hereafter
be primarily or secondarily liable for any or all of
the Obligations, including, without limitation, any
other maker, endorser, surety, or guarantor of all or a
portion of the Obligations or any person or entity who
is now or hereafter a party to any of the Restructuring
Documents (collectively, the "Obligors").
(b) Without limiting the generality of the foregoing, neither
Agent nor any Bank shall not be required to make any demand
on Borrower or the Obligors, sell at foreclosure or
otherwise pursue or exhaust its remedies against any
collateral or other security (or any part thereof) now or
hereafter pledged, assigned or granted to secure the
Obligations, before, simultaneously with or after enforcing
its rights and remedies hereunder against the Guarantor.
(c) The obligations and liabilities of the Guarantor hereunder
and under the other Restructuring Documents shall not be
subject to any counterclaim, recoupment, set-off, reduction,
or defense based upon any claim that the Guarantor may have
against Agent, any Bank, Borrower or any of the Obligors,
are independent of any other guaranty at any time in effect
with respect to the Obligations, and may be enforced
regardless of the existence of any other guaranty.
(d) Any one or more successive and/or concurrent actions may be
brought hereunder against the Guarantor either in the same
action, if any, brought against Borrower or any of the
Obligors, or in separate actions, as often as Agent or the
Banks may deem advisable.
(e) Agent and any Bank may, without notice to or consent of the
Guarantor or any other Obligor and with or without
consideration, release, compromise, settle with and proceed
against any Obligor and any security and collateral given by
such Obligor without affecting in any way the obligations
and liabilities of the Guarantor hereunder or under any of
the Restructuring Documents.
3. Indulgences. The Guarantor expressly agrees that Agent and each Bank
may, in its sole and absolute discretion, at any time and from time to
time, without notice to or further assent of the Guarantor and with or
without consideration, and without in any way releasing, modifying,
waiving, affecting or impairing any of the obligations and liabilities
of the Guarantor hereunder:
(a) waive compliance with, or any defaults under, or grant any other
indulgences with respect to, the Term Note or any of the other
Restructuring Documents (including, but not limited to, any
payment terms thereof);
(b) amend, substitute, extend, renew or modify any provision of the
Term Note or the other Restructuring Documents;
(c) effect any release, compromise or settlement in connection with
the Restructuring Documents;
(d) agree to the sale, substitution, exchange, release or other
disposition of all or any part of any collateral for the
Obligations and apply such collateral, and direct the order or
manner of sale thereof;
(e) make advances for the purpose of performing any term or covenant
contained in the Restructuring Documents with respect to which
the Borrower or any other party shall be in default;
(f) assign or otherwise transfer this Guaranty or any of the other
Restructuring Documents or any interest herein or therein;
(g) fail, omit, lack diligence, or delay to enforce, assert, or
exercise any right, power, privilege, or remedy conferred upon
Agent or any Bank under the provisions of any of the
Restructuring Documents or under applicable law; and
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(h) deal in all respects with Borrower or any Obligor as if this
Guaranty were not in effect.
4. Waiver. The Guarantor hereby expressly waives:
(a) presentment, protest and demand, notice of acceleration, notice
of protest, notice of demand, notice of dishonor, notice of
non-payment and notice of acceptance with respect to the Term
Note, the Obligations and this Guaranty;
(b) notice of the execution and delivery of the Restructuring
Documents, the making of the Loan or of the creation of any of
the Obligations;
(c) notice of any default or Event of Default under this Guaranty or
any of the other Restructuring Documents and of all indulgences;
(d) demand for the observance, performance or enforcement of any term
or provision of this Guaranty or any of the other Restructuring
Documents;
(e) all other notices and demands otherwise required by law that the
Guarantor may lawfully waive. The Guarantor waives any defense
arising by reason of any disability or other defense of Borrower,
any lack of authority of Borrower with respect to the
Restructuring Documents, the illegality, invalidity, or lack of
enforceability of the Restructuring Documents from any cause
whatsoever, the failure of Agent or any Bank to perfect or
maintain perfection of any interest in any security given to
secure the Obligations, or the cessation from any cause
whatsoever of the liability of the Borrower (except for the
defense that the Borrower has duly performed in accordance with
the Restructuring Documents). The Guarantor specifically agrees
that the misuse or misapplication of any of the proceeds of the
Loan by the Borrower or any other person or entity shall not
affect, lessen, impair or release the Guarantor from its
obligations and liabilities hereunder.
5. Subordination: Subrogation. Any liability, indebtedness or obligation
of Borrower to the Guarantor or of any Obligor to the Guarantor of
every kind or nature, whether now existing or hereafter created, due
or to become due, direct or contingent, is hereby subordinated in all
respects to the payment of the Obligations to Agent and the Banks. The
Guarantor agrees not to accept or receive any payment with respect to
any such liability, indebtedness or obligation until the payment and
performance in full of all of the Obligations. Until payment in full
of the Obligations, the Guarantor hereby irrevocably waives:
(a) all rights the Guarantor may have at law or in equity to seek
subrogation, contribution, indemnification or any other form of
reimbursement from Borrower or any Obligor.
(b) any right to enforce any remedy that Agent or any Bank now has or
may hereafter have against Borrower or any Obligor; and
(c) the benefit of, and any right to participate in, any security for
the Obligations now or hereafter held by Agent or any Bank
6. Representations and Warranties. The Guarantor hereby represents and
warrants to Agent that:
(a) The Guarantor is a corporation, duly organized and validly
existing in good standing under the laws of the State of Texas
and has the requisite power and authority (A) to carry on its
business as presently conducted, (B) to enter into and perform
its obligations under each Restructuring Document to which the
Guarantor is a party, and (C) to guarantee the Loan.
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(b) The execution, delivery and performance by the Guarantor of each
of the Restructuring Documents to which the Guarantor is a party,
have been duly authorized by all necessary corporate action, do
not require stockholder approval other than such as has been duly
obtained or given, do not or will not contravene any of the terms
of its articles of incorporation or by-laws, and will not violate
any provision of law or of any order of any court or Governmental
Authority or constitute (with or without notice or lapse of time
or both) a default under, or result in the creation of any
security interest, lien, charge or encumbrance upon any of the
properties or assets of the Guarantor pursuant to, any agreement,
indenture or other instrument to which the Guarantor is a party
or by which the Guarantor may be bound; each Restructuring
Document has been duly executed and delivered by the Guarantor
and constitutes the legal, valid and binding agreement or
instrument of the Guarantor, enforceable against the Guarantor in
accordance with the respective terms thereof. The enforceability
of the Restructuring Documents, however, is subject to all
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the rights of creditors and to general
equity principles.
(c) There are no actions, suits or proceedings pending or, to the
knowledge of the Guarantor, threatened before any court,
arbitrator or Governmental Authority (A) under the Environmental
Laws, (B) that would prevent the execution or delivery of the
Restructuring Documents, or (C) that, either individually or in
the aggregate, might materially affect the Vessels, the financial
condition or operations of the Guarantor, the authority of the
Guarantor to enter into and perform this Guaranty and the other
Restructuring Documents, or the ability of the Guarantor to pay
the Obligations in full.
(d) Guarantor represents and warrants that the representations and
warranties of Borrower made in the Loan Agreement are true and
accurate in each and every respect.
7. Affirmative Covenants. Until payment in full and the performance of
all of the Obligations, the Guarantor shall comply with each of the
covenants set forth in the Loan Agreement as if it were a Borrower
thereunder.
8. Event of Default. The occurrence of any one or more of the following
events shall be "Events of Default" hereunder:
8.1 Failure to Pay. The Guarantor shall fail to perform or observe any of
its obligations under Section 1 of this Guaranty.
8.2 Failure to Perform. The Guarantor shall fail to perform or observe any
covenant, condition or agreement (other than those set forth in
Section 1 of this Guaranty) to be performed or observed by it
hereunder or under any of the other Restructuring Documents, which
failure shall continue unremedied after written notice thereof from
Agent.
8.3 Breach of Representations and Warranties. Any certificate, statement,
representation, warranty or audit contained herein or heretofore or
hereafter furnished with respect to this Guaranty or any of the other
Restructuring Documents by or on behalf of the Guarantor proves to
have been false in any material respect at the time as of which the
facts therein set forth were stated or certified, or omits any
substantial contingent or unliquidated liability or claim against the
Guarantor.
8.4 Event of Default Under Other Restructuring Documents. A default or an
Event of Default (as defined therein) occurs under any of the other
Restructuring Documents.
8.5. Bankruptcy. Any of the following events shall occur:
(i) The Guarantor commences a voluntary case under Title 11 of the
United States Code as now or hereafter in effect, or any
successor thereto (the "Bankruptcy Code"); or
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(ii) An involuntary case is commenced against the Guarantor under the
Bankruptcy Code and relief is ordered against the Guarantor or
the petition is controverted but is not dismissed or stayed
within sixty (60) days after the commencement of the case; or
(iii)A custodian (as defined in the Bankruptcy Code) or a similar
official is appointed for, or takes charge of, all or
substantially all of the property of the Guarantor and such
appointment is not terminated within sixty (60) days; or
(iv) The Guarantor commences any other proceeding under any
reorganization, arrangement, readjustment of debt, relief of
debtors, dissolution, insolvency, liquidation or similar law of
any jurisdiction relating to the Guarantor (whether now or
hereafter in effect), or there is commenced against the Guarantor
any such proceeding that remains undismissed or unstayed for a
period of sixty (60) days; or the Guarantor is adjudicated
insolvent or bankrupt; or the Guarantor fails to controvert in a
timely manner any such case under the Bankruptcy Code or any such
proceeding, or any order of relief or other order approving any
such case or proceeding is entered; or
(v) The Guarantor, by any act or failure to act, indicates its
consent to, approval of or acquiescence in any such case or
proceeding or in the appointment of any custodian of or for it or
any substantial part of its property or suffers any such
appointment to continue undischarged or unstayed for a period of
ninety (90) days; or
(vi) The Guarantor makes a general assignment for the benefit of
creditors; or
(vii)Any corporate action is taken by the Guarantor for the purpose
of effecting any of the foregoing.
8.6 Reorganization: Attachment. An order, judgment or decree shall be
entered, without the application, approval or consent of the
Guarantor, by any court of competent jurisdiction, approving a
petition seeking reorganization of the Guarantor or seizure or
attachment of all or a substantial part of the Guarantor's assets, and
such order, judgment or decree shall continue unstayed and in effect
for any period of sixty (60) consecutive days.
8.7 Judgments. Judgments or orders for the payment of monies in excess of
USD 500,000 in aggregate shall be rendered against the Guarantor and
such judgments or orders shall continue unsatisfied, unstayed or
unbonded for a period of thirty (30) days.
8.8 Cross Default. The Guarantor, any other guarantor of the Loan or any
affiliate of the Guarantor, shall be in default under any direct,
indirect or contingent material obligation or indebtedness now or
hereafter existing in favor any Bank or any other person or entity.
For purposes hereof, an "affiliate" of the Guarantor shall mean any
person or entity which controls, is controlled by or is under common
control with the Guarantor.
8.9 Anticipatory Repudiation. The Guarantor engages in a course of action
or dealing that causes Agent reasonably to believe that there is an
anticipatory repudiation of the Guarantor's obligations under this
Guaranty.
8.10 Termination of Guarantor. The corporate existence of the Guarantor is
terminated and its obligations hereunder are not assumed by a
successor in interest reasonably satisfactory to Agent.
9. Rights and Remedies. Upon the occurrence of an Event of Default
(whether or not declared to be such by Agent or the required Banks),
and in every such event and at any time thereafter, Agent may (but
shall
PAGE 6
not be obligated to) do any one or more of the following at the sole
cost and expense of the Guarantor, all of which are hereby
authorized by the Guarantor:
(a) Declare the Obligations (whether then due or not) to be
immediately due and payable by the Guarantor, and the Guarantor
shall on demand pay the same to Agent for the ratable benefit of
the Banks in immediately available funds;
(b) Xxx for and recover all liquidated damages, accelerated payments
and/or other sums otherwise recoverable from Borrower under the
Restructuring Documents (whether then due or not);
(c) Xxx for and recover all damages then or thereafter incurred by
Agent and each Bank as a result of such Event of Default; and/or
(d) Seek specific performance of the Guarantor's obligations
hereunder and under the other Restructuring Documents.
10. Expenses. The Guarantor shall be liable for, and shall pay to Agent
and each Bank upon demand, all expenses incurred by or on behalf of
Agent and each Bank by reason of any Event of Default or the exercise
by Agent or any Bank of its rights or remedies hereunder and under any
of the other Restructuring Documents, including, but not limited to,
attorneys' fees and expenses.
11. Continuing Guaranty. This Guaranty is a continuing one and shall
terminate only upon payment in full of the Obligations and the
performance of all of the terms, covenants and conditions of the
Restructuring Documents, and satisfaction by the Guarantor of all of
his obligations hereunder. This Guaranty shall continue to be
effective, or be reinstated, as the case may be, if at any time any
payment, or any part thereof, of any of the Obligations is rescinded,
avoided, reduced or must otherwise be restored or returned by Agent or
any Bank upon the insolvency, Bankruptcy, receivership, dissolution,
liquidation or reorganization of any of the Borrower, the Guarantor or
the Obligors, or upon or as a result of the appointment of a receiver,
intervener or conservator of, or trustee or similar officer for, any
of the Borrower, the Guarantor or the Obligors or any of their
respective property, or otherwise, all as though such payment had not
been made and irrespective of whether such payment is returned to the
party who originally made it or to some other party.
12. Notice. All notices, requests and demands shall be in writing
(including telecopier transmission) given to or made upon the
respective parties hereto as follows:
In the case of the Guarantor:
Xxxxxx Oceanics, Inc.
00000 Xxxx Xxx Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attention: Senior Vice President
Telecopier: (000) 000-0000
In the case of Agent:
The Chase Manhattan Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx
Telecopier: (000) 000-0000
or in such other manner an any party hereto shall designate by written
notice to the other parties hereto. All such notices shall be
effective upon delivery or three (3) days after being deposited in the
United States mail with
PAGE 7
postage prepaid certified, return receipt requested in a correctly
addressed wrapper, or upon receipt if delivered to Federal Express or
similar courier company or transmitted by telefax during normal
business hours, except that all notices, requests and demands to Agent
shall not be effective until received by Agent.
13. Cumulative Remedies: Waiver of Rights. Each right, power and remedy of
Agent and the Banks as provided for in this Guaranty or in any of the
other Restructuring Documents or now or hereafter existing at law, in
equity or otherwise shall be cumulative and concurrent and shall be in
addition to every other right, power or remedy provided for in this
Guaranty, in the other Restructuring Documents or now or hereafter
existing at law, in equity or otherwise. The exercise or beginning of
the exercise by Agent or any Bank of any one or more of such rights,
powers or remedies shall not preclude the simultaneous or later
exercise by Agent or any Bank of any or all such other rights, powers
or remedies. No delay or omission by Agent or any Bank in exercising
any such right or remedy shall operate as a waiver thereof. No waiver
of any rights and remedies hereunder, and no modification or amendment
hereof, shall be deemed made by Agent or any Bank unless in writing
and duly signed by Agent and such Bank. Any such written waiver shall
apply only to the particular instance specified therein and shall not
impair the further exercise of such right or remedy or of any other
right or remedy of Agent or any Bank.
14. Severability. In case any provision (or any part of any provision)
contained in this Guaranty shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provision (or remaining
part of the affected provision) of this Guaranty, and this Guaranty
shall be construed as if such invalid, illegal or unenforceable
provision (or part thereof) had never been contained herein but only
to the extent it is invalid, illegal or unenforceable.
15. Survival of Terms. All covenants, agreements, representations and
warranties made by the Guarantor herein, in the Restructuring
Documents or in any other certificates, instruments or documents
delivered pursuant hereto shall survive the making by the Banks of the
Term Loans and the execution and delivery of the Term Notes, and shall
continue in full force and effect so long as any of the Obligations
are outstanding and unpaid.
16. Entire Agreement: Modification. This Guaranty, together with the other
Restructuring Documents, constitute the final and entire agreement and
understanding of the parties, and any term, condition, covenant or
agreement not contained herein or therein is not a part of the
agreement and understanding of the parties. Neither this Guaranty, nor
any term, condition, covenant or agreement hereof, may be changed,
waived, discharged or terminated orally, except by an instrument in
writing signed by the party against whom enforcement of the change,
waiver, discharge or termination is sought.
17. Construction. Whenever used herein, the singular number shall include
the plural, the plural the singular and the use of the masculine,
feminine or neuter gender shall include all genders. The headings in
this Guaranty are for convenience only and shall not limit or
otherwise affect any of the terms hereof.
18. Applicable Law and Jurisdiction. (a) THIS GUARANTY AND THE
RESTRUCTURING DOCUMENTS (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY
AND ENFORCEABILITY HEREOF AND THEREOF SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, OTHER
THAN CONFLICT OF LAWS RULES THEREOF. ANY LEGAL ACTION OR PROCEEDING
AGAINST THE GUARANTOR WITH RESPECT TO THIS GUARANTY OR ANY
RESTRUCTURING DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
NEW YORK, THE U.S. FEDERAL COURTS IN SUCH STATE, SITTING IN THE COUNTY
OF NEW YORK, OR IN THE COURTS OF ANY OTHER JURISDICTION WHERE SUCH
ACTION OR PROCEEDING MAY BE PROPERLY BROUGHT, AND THE GUARANTOR HEREBY
IRREVOCABLY ACCEPTS THE JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF
ANY ACTION OR PROCEEDING. The Guarantor further irrevocably consents
to the service of process out of said courts by the mailing thereof by
Agent by U.S. registered or certified mail postage prepaid to the
party to be served at its address designated in
PAGE 8
Section 12 hereof. The Guarantor agrees that a final judgment in any
action or proceeding shall be conclusive and may be enforced in any
other jurisdiction by suit on the judgment or in any other manner
provided by law. Nothing in this Section shall affect the right of
Agent or the Banks to serve legal process in any other manner
permitted by law or affect the right of Agent or the Banks to bring
any action or proceeding against the Guarantor or its properties in
the courts of any other jurisdiction. To the extent that the Guarantor
has or hereafter may acquire any immunity from jurisdiction of any
court or from any legal process (whether through service of notice,
attachment prior to judgment, attachment in aid of execution,
execution or otherwise) with respect to either itself or its property,
the Guarantor hereby irrevocably waives such immunity in respect of
its obligations under this agreement and the other Restructuring
Documents..
(b) THE AGENT, EACH BANK AND THE GUARANTOR HEREBY IRREVOCABLY WAIVE
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY
OTHER RESTRUCTURING DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
19. Assignment. The Agent and each Bank may, without notice to or consent
of the Guarantor, sell, assign or transfer to any one or more persons
or entities, all or any part of the Obligations or all or any part of
the Restructuring Documents and each such assignee or transferee shall
have the right to enforce the Obligations and such Restructuring
Documents as fully as the transferor, provided that such transferor
shall continue to have the unimpaired right to enforce the provisions
of the Restructuring Documents and the Obligations that it has not
sold, assigned or transferred. Additionally, each Bank may sell or
grant to any other one or more persons or entities participation in
all or any part of the Obligations or all or any part of the
Restructuring Documents. In connection with and prior to and after any
such sale, transfer, assignment or participation, and each selling
Bank may disclose and furnish to any prospective or actual purchaser,
transferee, assignee or participant, any and all reports, financial
statements and other information obtained by Agent or such Bank at any
time and from time to time in connection with the Term Loans, the
Obligations, the Restructuring Documents or otherwise. The Guarantor
shall fully cooperate with Agent and each selling Bank in connection
with any such assignment and shall execute and deliver such consents
and acceptances to any such assignment necessary or desirable, in
Agent's sole discretion, to effect any such assignment.
IN WITNESS WHEREOF, the Guarantor has caused this Limited Guaranty to be
duly executed as of the date first above written.
XXXXXX OCEANICS, INC.
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx
Senior Vice President
