EXHIBIT 7.12
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LIMITED GUARANTEE
Limited Guarantee, dated as of March 18, 2007 (this "Limited
Guarantee"), by The Woodbridge Company Limited (the "Guarantor"), in favor of
EGL, Inc. (the "Guaranteed Party").
1. LIMITED GUARANTEE. To induce the Guaranteed Party to
enter into an Agreement and Plan of Merger, dated as of the date hereof, (as
amended, amended and restated, supplemented or otherwise modified from time to
time, the "Merger Agreement"; capitalized terms used but not defined herein
shall have the meanings given to such terms in the Merger Agreement), by and
among Talon Holdings Corp., a Delaware corporation ("Parent"), Talon Acquisition
Co., a Texas corporation ("Merger Sub") and the Guaranteed Party, pursuant to
which Merger Sub will merge with and into the Guaranteed Party, the Guarantor
hereby absolutely, unconditionally and irrevocably guarantees to the Guaranteed
Party, the due and punctual performance and discharge of 16.3% of the payment
obligations of Parent and Merger Sub under the last sentence of Section 5.10,
Section 7.2(b) and Section 7.2(d) of the Merger Agreement (the "Obligations");
provided that in no event shall the Guarantor's liability under this Guarantee
exceed $4,890,000 (the "Cap"), it being understood that this Limited Guarantee
may not be enforced without giving effect to the Cap. In furtherance of the
foregoing, the Guarantor acknowledges that its liability hereunder shall extend
to 16.3% of the Obligations (subject to the Cap), and that the Guaranteed Party
may, in its sole discretion, bring and prosecute a separate action or actions
against the Guarantor for 16.3% of the Obligations (subject to the Cap),
regardless of whether action is brought against Parent, Merger Sub or any other
guarantor pursuant to a Limited Guarantee dated as of the date hereof to be
entered into between the Guaranteed Party and such other guarantor (the "Other
Guarantors") or whether Parent, Merger Sub or any Other Guarantor is joined in
any such action or actions.
2. NATURE OF GUARANTEE. The Guaranteed Party shall not be
obligated to file any claim relating to the Obligations in the event that Parent
or Merger Sub becomes subject to a bankruptcy, reorganization or similar
proceeding, and the failure of the Guaranteed Party to so file shall not affect
the Guarantor's obligations hereunder. In the event that any payment to the
Guaranteed Party in respect of the Obligations is rescinded or must otherwise be
returned for any reason whatsoever, the Guarantor shall remain liable hereunder
with respect to the Obligations as if such payment had not been made. This is an
unconditional guarantee of payment and not of collectibility.
3. CHANGES IN OBLIGATIONS, CERTAIN WAIVERS. The Guarantor
agrees that the Guaranteed Party may at any time and from time to time, without
notice to or further consent of the Guarantor, extend the time of payment of any
of the Obligations, and may also make any agreement with Parent, Merger Sub or
with any other Person (including any Other Guarantor) interested in the
transactions contemplated by the Merger Agreement, for the extension, renewal,
payment, compromise, discharge or release thereof, in whole or in part, or for
any modification of the terms thereof or of any agreement between the Guaranteed
Party and Parent, Merger Sub or any such other Person without in any way
impairing or affecting the Guarantor's obligations under this Limited Guarantee.
The Guarantor agrees that the obligations of the Guarantor hereunder shall not
be released or discharged, in whole or in part, or otherwise affected by (a) the
failure of the Guaranteed Party to assert any claim or demand or to enforce any
right or remedy against Parent, Merger Sub or any other Person interested in the
transactions contemplated by the Merger Agreement (including any Other
Guarantor); (b) any change in the time, place or manner of payment of any of the
Obligations or any rescission, waiver, compromise, consolidation or other
amendment or modification of any of the terms or provisions of the Merger
Agreement or any other agreement evidencing, securing or otherwise executed in
connection with any of the Obligations; (c) the addition, substitution or
release of any Person interested in the transactions contemplated by the Merger
Agreement (including any Other Guarantor); (d) any change in the corporate
existence, structure or ownership of Parent, Merger Sub or any other Person
interested in the transactions contemplated by the Merger Agreement (including
any Other Guarantor); (e) any insolvency, bankruptcy, reorganization or other
similar proceeding affecting Parent, Merger Sub or any other Person interested
in the transactions contemplated by the Merger Agreement (including any Other
Guarantor); (f) the existence of any claim, set-off or other right which the
Guarantor may have at any time against Parent, Merger Sub or the Guaranteed
Party, whether in connection with the Obligations or otherwise; or (g) the
adequacy of any other means the Guaranteed Party may have of obtaining repayment
of any of the Obligations. To the fullest extent permitted by law, the Guarantor
hereby expressly waives any and all rights or defenses arising by reason of any
law which would otherwise require any election of remedies by the Guaranteed
Party. The Guarantor waives promptness, diligence, notice of the acceptance of
this Limited Guarantee and of the Obligations, presentment, demand for payment,
notice of non-performance, default, dishonor and protest, notice of any
Obligations incurred and all other notices of any kind (except for notices to be
provided to Parent, Merger Sub and Goodmans LLP in accordance with Section 8.7
of the Merger Agreement), all defenses which may be available by virtue of any
valuation, stay, moratorium law or other similar law now or hereafter in effect,
any right to require the marshalling of assets of Parent, Merger Sub or any
other Person interested in the transactions contemplated by the Merger Agreement
(including any Other Guarantor), and all suretyship defenses generally (other
than fraud or willful misconduct by the Guaranteed Party or any of its
Subsidiaries, defenses to the payment of the Obligations that are available to
Parent or Merger Sub under the Merger Agreement or breach by the Guaranteed
Party of this Limited Guarantee). The Guarantor acknowledges that it will
receive substantial direct and indirect benefits from the transactions
contemplated by the Merger Agreement and that the waivers set forth in this
Limited Guarantee are knowingly made in contemplation of such benefits.
The Guaranteed Party hereby covenants and agrees that it shall
not institute, and shall cause its Affiliates that are under its control
("Controlled Affiliates") not to institute, any proceeding or bring any other
claim arising under, or in connection with, the Merger Agreement or the
transactions contemplated thereby, against any Guarantor or any of its former,
current or future directors, officers, agents, Affiliates (other than Parent or
Merger Sub) or employees, or against any of the former, current or future
general or limited partners, members, managers or stockholders of the Guarantor
or any Affiliate thereof (other than Parent or Merger Sub) or against any
former, current or future directors, officers, agents, Affiliates, general or
limited partners, members, managers or stockholders of any of the foregoing
(other than Parent or Merger Sub), except for claims against the Guarantor under
this Limited Guarantee and against Other Guarantors under their written limited
guarantees, and the Guarantor hereby covenants and agrees that it shall not
institute, and shall cause its respective Affiliates not to institute, any
proceedings asserting that this Limited Guarantee is illegal, invalid or
unenforceable in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or
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other similar laws affecting creditors' rights generally, and general equitable
principles (whether considered in a proceeding in equity or at law). The
Guarantor hereby unconditionally and irrevocably agrees not to exercise any
rights that it may now have or hereafter acquire against Parent, Merger Sub or
any other Person interested in the transactions contemplated by the Merger
Agreement (including any Other Guarantor) that arise from the existence,
payment, performance, or enforcement of the Guarantor's obligations under or in
respect of this Limited Guarantee or any other agreement in connection
therewith, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of the Guaranteed Party against Parent,
Merger Sub or such other Person, 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 Parent, Merger Sub or such other
Person, 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 Obligations and all other amounts payable under this
Limited Guarantee shall have been paid in full in cash. If any amount shall be
paid to the Guarantor in violation of the immediately preceding sentence at any
time prior to the payment in full in cash of the Obligations and all other
amounts payable under this Limited Guarantee, such amount shall be received and
held in trust for the benefit of the Guaranteed Party, shall be segregated from
other property and funds of the Guarantor and shall forthwith be paid or
delivered to the Guaranteed Party in the same form as so received (with any
necessary endorsement or assignment) to be credited and applied to the
Obligations and all other amounts payable under this Limited Guarantee, in
accordance with the terms of the Merger Agreement, whether matured or unmatured,
or to be held as collateral for any Obligations or other amounts payable under
this Limited Guarantee thereafter arising. Notwithstanding anything to the
contrary contained in this Limited Guarantee, the Guaranteed Party hereby agrees
that to the extent Parent and Merger Sub are relieved in full of their
obligations under the last sentence of Section 5.10, Section 7.2(b) and Section
7.2(d) of the Merger Agreement, the Guarantor shall be similarly relieved of its
obligations under this Limited Guarantee.
4. NO WAIVER; CUMULATIVE RIGHTS. No failure on the part of
the Guaranteed Party to exercise, and no delay in exercising, any right, remedy
or power hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise by the Guaranteed Party of any right, remedy or power hereunder
preclude any other or future exercise of any right, remedy or power hereunder.
Each and every right, remedy and power hereby granted to the Guaranteed Party or
allowed it by law or other agreement shall be cumulative and not exclusive of
any other, and may be exercised by the Guaranteed Party at any time or from time
to time.
5. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants that:
(a) the execution, delivery and performance of this Limited
Guarantee have been duly authorized by all necessary action and do
not contravene any provision of the Guarantor's charter, partnership
agreement, operating agreement or similar organizational documents
or any law, regulation, rule, decree, order, judgment or contractual
restriction binding on the Guarantor or its assets;
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(b) all consents, approvals, authorizations, permits of,
filings with and notifications to, any governmental authority
necessary for the due execution, delivery and performance of this
Limited Guarantee by the Guarantor have been obtained or made and
all conditions thereof have been duly complied with, and no other
action by, and no notice to or filing with, any governmental
authority or regulatory body is required in connection with the
execution, delivery or performance of this Limited Guarantee;
(c) this Limited Guarantee constitutes a legal, valid and
binding obligation of the Guarantor enforceable against the
Guarantor in accordance with its terms, subject to (i) the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws affecting creditors' rights
generally, and (ii) general equitable principles (whether considered
in a proceeding in equity or at law); and
(d) the Guarantor has the financial capacity to pay and
perform its obligations under this Limited Guarantee, and all funds
necessary for the Guarantor to fulfill its obligations under this
Limited Guarantee shall be available to the Guarantor (or its
assignee pursuant to Section 6 hereof) for so long as this Limited
Guarantee shall remain in effect in accordance with Section 8
hereof.
6. NO ASSIGNMENT. Neither the Guarantor nor the Guaranteed
Party may assign its rights, interests or obligations hereunder to any other
Person (except by operation of law) without the prior written consent of the
Guaranteed Party (in the case of an assignment by the Guarantor) or the
Guarantor (in the case of an assignment by the Guaranteed Party); provided,
however, the Guarantor shall be permitted to assign, in whole or in part, its
rights and obligations hereunder to another entity controlled directly or
indirectly by the Guarantor that certifies to the Guaranteed Party that it is
capable of (i) making the representations and warranties set forth in Section 5
above and (ii) performing all of its obligations hereunder.
7. NOTICES. Any notice required to be given hereunder shall
be sufficient if in writing, and sent by facsimile transmission (provided that
any notice received by facsimile transmission or otherwise at the addressee's
location on any Business Day after 5:00 p.m. (addressee's local time) shall be
deemed to have been received at 9:00 a.m. (addressee's local time) on the next
Business Day), by reliable overnight delivery service (with proof of service),
hand delivery or certified or registered mail (return receipt requested and
first-class postage prepaid), addressed as follows:
(i) if to the Guaranteed Party, to it at:
EGL, Inc.
00000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Attention: General Counsel
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with a copy (which shall not constitute notice) to:
Xxxxxxx Xxxxx LLP
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
(ii) if to the Guarantor, to it at:
The Woodbridge Company Limited
00 Xxxxx Xxxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx
Xxxxxx, X0X 0X0
Attention: Xxxxx Xxxxxx, Senior Counsel
Fax: (000) 000-0000
with a copy (which shall not constitute notice) to:
Goodmans LLP
000 Xxxxx Xxxxxx
Xxxxx 0000, Xxx 00
Xxxxxxx, Xxxxxxx
Xxxxxx, X0X 0X0
Attention: Xxxxx X Xxxxx
Fax: (000) 000-0000
8. CONTINUING GUARANTEE. This Limited Guarantee shall
remain in full force and effect and shall be binding on the Guarantor, its
successors and assigns until the Obligations are satisfied in full.
Notwithstanding the foregoing, this Limited Guarantee shall terminate and the
Guarantor shall have no further obligations under this Limited Guarantee as of
the earliest of (i) the Effective Time, (ii) the termination of the Merger
Agreement in accordance with its terms by mutual consent of the parties or under
circumstances in which Parent and Merger Sub would not be obligated to make any
payments under Section 7.2(b) and (iii) the first anniversary of any termination
of the Merger Agreement in accordance with its terms under circumstances in
which Parent and Merger Sub would be obligated to make any payments under
Section 7.2(b) if the Guaranteed Party has not presented a claim for payment of
any Obligation to Parent and Merger Sub or any Guarantor (including the Other
Guarantors) by such first anniversary. Notwithstanding the foregoing, in the
event that the Guaranteed Party or any of its Controlled Affiliates asserts in
any litigation or other proceeding that the provisions of Section 1 hereof
limiting the Guarantor's liability to the Cap or the provisions of this Section
8 or Section 9 hereof are illegal, invalid or unenforceable in whole or in part,
or asserting any theory of liability against the Guarantor or any Affiliates of
the Guarantor with respect to the transactions contemplated by the Merger
Agreement other than liability of the Guarantor under this Limited Guarantee (as
limited by the provisions of Section 1), then (i) the obligations of the
Guarantor under this Limited Guarantee shall terminate ab initio and be null and
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void, (ii) if the Guarantor has previously made any payments under this Limited
Guarantee, it shall be entitled to recover such payments, and (iii) neither the
Guarantor nor any Affiliate of any Guarantor shall have any liability to the
Guaranteed Party with respect to the transactions contemplated by the Merger
Agreement or under this Limited Guarantee; provided, however, that if the
Guarantor asserts in any litigation or other proceeding that this Limited
Guarantee is illegal, invalid or unenforceable in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws affecting creditors' rights
generally, and general equitable principles (whether considered in a proceeding
in equity or at law), then, to the extent the Guaranteed Party prevails in such
litigation or proceeding, the Guarantor shall pay on demand all reasonable fees
and out of pocket expenses of the guaranteed Party in connection with such
litigation or proceeding.
9. NO RECOURSE. The Guaranteed Party by its acceptance of
the benefits hereof, covenants, agrees and acknowledges that no Person other
than the Guarantor shall have any obligation hereunder and that no recourse
hereunder or under any documents or instruments delivered in connection herewith
shall be had against any former, current or future director, officer, agent,
Affiliate (other than Parent or Merger Sub) or employee of the Guarantor,
against any former, current or future general or limited partner, member,
manager or stockholder of the Guarantor or any Affiliate thereof (other than
Parent or Merger Sub) or against any former, current or future director,
officer, agent, Affiliate, employee, general or limited partner, member, manager
or stockholder of any of the foregoing (other than Parent or Merger Sub),
whether by the enforcement of any assessment or by any legal or equitable
proceeding, or by virtue of any statute, regulation or other applicable law;
provided, however, that this Limited Guarantee shall in no respect release or
limit any obligations or liabilities of Guarantor or any other party under any
confidentiality agreement entered into for the Guaranteed Party's benefit. The
Guaranteed Party acknowledges and agrees that the only assets of Parent and
Merger Sub are cash in a de minimus amount and that no additional funds are
expected to be contributed to Parent or Merger Sub unless the Closing occurs.
The Guaranteed Party further agrees that neither it nor any of its Controlled
Affiliates have any right of recovery against the Guarantor or any of its
former, current or future directors, officers, agents, Affiliates (other than
Parent or Merger Sub), general or limited partners, members, managers or
stockholders through Parent or Merger Sub or otherwise, whether by piercing of
the corporate veil, by a claim on behalf of Parent or Merger Sub against the
Guarantor or Parent's stockholders or Affiliates, or otherwise, except for the
rights under this Limited Guarantee and its rights against Other Guarantors
pursuant to the terms of their written limited guarantees delivered
contemporaneously herewith. Recourse against the Guarantor under this Limited
Guarantee shall be the exclusive remedy of the Guaranteed Party and its
Affiliates against the Guarantor and any of its former, current or future
directors, officers, agents, Affiliates, general or limited partners, members,
managers or stockholders in respect of any liabilities or obligations arising
under, or in connection with, the Merger Agreement or the transactions
contemplated thereby. The Guaranteed Party hereby covenants and agrees that it
shall not institute, and it shall cause its Controlled Affiliates not to
institute, any proceeding or bring any other claim arising under, or in
connection with, the Merger Agreement or the transactions contemplated thereby,
against the Guarantor or any of its former, current or future directors,
officers, agents, Affiliates (other than Parent or Merger Sub), general or
limited partners, members, managers or stockholders except for claims against
the Guarantor under this Limited Guarantee. Except as contemplated under Section
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6, nothing set forth in this Limited Guarantee shall affect or be construed to
confer or give any Person other than the Guarantor and the Guaranteed Party
(including any Person acting in a representative capacity) any rights or
remedies against any Person.
10. GOVERNING LAW. This Guarantee and any dispute hereunder
shall be governed by, and construed in accordance with, the laws of the State of
New York. Each of the parties hereto (i) consents to submit itself to the
personal jurisdiction of any state or federal court sitting in the Borough of
Manhattan of The City of New York in the event any dispute arises out of this
Guarantee or any of the transactions contemplated by this Guarantee, (ii) agrees
that it will not attempt to deny or defeat such personal jurisdiction or venue
by motion or other request for leave from any such court and (iii) agrees that
it will not bring any action relating to this Guarantee or any of the
transactions contemplated by this Guarantee in any court other than such courts
sitting in the Borough of Manhattan of The City of New York.
11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS LIMITED GUARANTEE OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.
12. COUNTERPARTS. This Limited Guarantee may be executed and
delivered (including by facsimile transmission) in one or more counterparts, and
by the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the Guarantor has caused this Limited Guarantee to
be executed and delivered as of the date first written above by its officer
thereunto duly authorized.
THE WOODBRIDGE COMPANY LIMITED
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: Senior Counsel
[Limited Guarantee Signature Page]
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IN WITNESS WHEREOF, the Guaranteed Party has caused this Limited
Guarantee to be executed and delivered as of the date first written above by its
officer thereunto duly authorized.
EGL, INC.
By: /s/Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
Title: Secretary & General Counsel
[Limited Guarantee Signature Page]
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