EXHIBIT 10.3
GUARANTEE AGREEMENT
GUARANTEE AGREEMENT, dated as of June 18, 2002 (as amended, modified
or supplemented from time to time, this "Guaranty"), made by each of the
undersigned guarantors (each a "Guarantor," and together with any other entity
that becomes a guarantor hereunder pursuant to Section 26 hereof, the
"Guarantors"). Except as otherwise defined herein, capitalized terms used herein
and defined in the Credit Agreement (as defined below) shall be used herein as
therein defined.
W I T N E S S E T H :
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WHEREAS, Xxxxxxx Companies, Inc. (the "Borrower"), the lenders
from time to time party thereto (the "Lenders"), Deutsche Bank Trust Company
Americas, as Administrative Agent (together with any successor Administrative
Agent, (the "Administrative Agent"), JPMorgan Chase Bank and Citicorp North
America, Inc., as Syndication Agents, Xxxxxx Commercial Paper Inc. and
Wachovia Bank, National Association, as Documentation Agents, Deutsche Bank
Securities Inc. and X.X. Xxxxxx Securities Inc., as Joint Book Managers and
Deutsche Bank Securities Inc., X.X. Xxxxxx Securities Inc. and Xxxxxxx Xxxxx
Barney Inc., as Joint Lead Arrangers, have entered into a Credit Agreement,
dated as of June 18, 2002 (as amended, modified, or supplemented from time to
time, the "Credit Agreement"), providing for the making of Loans to, and the
issuance of Letters of Credit for the account of, the Borrower as
contemplated therein (the Lenders, the Collateral Agent, the Issuing Lender
and the Administrative Agent are herein called the "Lender Creditors");
WHEREAS, the Borrower may on the date hereof be party to, or at any
time and from time to time on or after the date hereof enter into, one or more
interest rate swap agreements, interest rate cap agreements, interest rate
collar agreements, interest rate hedging agreements, foreign currency exchange
or hedging agreements or other similar agreement or arrangements (each such
agreement or arrangement, an "Interest Rate Protection/Currency Exchange
Agreement" and, collectively, the "Interest Rate Protection/Currency Exchange
Agreements") with one or more Lenders or any affiliate thereof (each such Lender
or affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender's or
affiliate's successors and assigns, if any, collectively, the "Other Creditors,"
and together with the Lender Creditors, the "Secured Creditors");
WHEREAS, the Borrower, one or more Wholly-Owned Domestic
Subsidiaries of the Borrower and JPMorgan Chase Bank (or any successor by merger
thereto) and/or one or more of its banking affiliates or another bank reasonably
satisfactory to the Administrative Agent (collectively, the "Treasury Service
Creditors" and, together with the Lender Creditors and the Other Creditors, the
"Secured Creditors") have entered into, or in the future may enter into, a
credit arrangement (with any written agreement evidencing such credit
arrangement, as amended, modified, supplemented, replaced or refinanced from
time to time, herein called the "Treasury Service Agreement") providing for
treasury, depositary or cash management services
(including, without limitation, overnight overdraft services) to the Borrower
and such Wholly-Owned Subsidiaries by the Treasury Service Creditors, and
automated clearinghouse transfers of funds to the Treasury Service Creditors, in
each case pursuant to uncommitted lines of credit (collectively, "Treasury
Services");
WHEREAS, each Guarantor is a direct or indirect Subsidiary of the
Borrower;
WHEREAS, it is a condition precedent to (i) the making of Loans to,
and the issuance of Letters of Credit for the account of, the Borrower under the
Credit Agreement, (ii) the Other Creditors maintaining and/or entering into
Interest Rate Protection/Currency Exchange Agreements with the Borrower and
(iii) the continued extension of Treasury Services by the Treasury Service
Creditors that each Pledgor shall have executed and delivered to the
Administrative Agent this Guaranty; and
WHEREAS, each Guarantor will obtain benefits from the incurrence of
Loans to, and the issuance of Letters of Credit for the account of, the Borrower
under the Credit Agreement, the entering into by the Borrower of Interest Rate
Protection/Currency Exchange Agreements and the extension of Treasury Services
and, accordingly, desires to execute this Guaranty in order to satisfy the
conditions described in the preceding paragraph;
NOW, THEREFORE, in consideration of the foregoing and other benefits
accruing to each Guarantor, the receipt and sufficiency of which are hereby
acknowledged, each Guarantor hereby makes the following representations and
warranties to the Secured Creditors and hereby covenants and agrees with each
Secured Creditor as follows:
1. Each Guarantor, jointly and severally, irrevocably, absolutely
and unconditionally guarantees: (i) to the Lender Creditors the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of (x) the principal of, premium, if any, and interest on the Loans made to, the
Borrower under the Credit Agreement, and all reimbursement obligations with
respect to Letters of Credit issued under the Credit Agreement and (y) all other
obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due), liabilities and
indebtedness owing by the Borrower to the Lender Creditors under the Credit
Agreement and each other Loan Document to which the Borrower is a party
(including, without limitation, indemnities, fees and interest thereon), whether
now existing or hereafter incurred under, arising out of or in connection with
the Credit Agreement and any such other Loan Document and the due performance
and compliance by the Borrower with all of the terms, conditions and agreements
contained in all such Loan Documents (all such principal, premium, interest,
liabilities, indebtedness and obligations being herein collectively called the
"Loan Document Obligations"), (ii) to each Other Creditor the full and prompt
payment when due (whether at the stated maturity, by acceleration or otherwise)
of all obligations (including obligations which, but for the automatic stay
under Section 362(a) of the Bankruptcy Code, would become due), liabilities and
indebtedness owing by the Borrower under any Interest Rate Protection/Currency
Exchange Agreement, whether now in existence or hereafter arising, and the due
performance and compliance by the Borrower with all of the terms, conditions and
agreements contained in each Interest Rate Protection/Currency Exchange
Agreement (all such obligations, liabilities and
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indebtedness described in this clause (ii) being herein collectively called the
"Other Obligations") and (iii) the full and prompt payment when due (whether at
the stated maturity, by acceleration or otherwise) of all obligations,
liabilities and indebtedness (including, without limitation, all interest that
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, reorganization or similar proceeding of any
Guarantor at the rate provided for in the respective documentation, whether or
not a claim for post-petition interest is allowed in any such proceeding) owing
by such Guarantor to the Treasury Service Creditors under, or with respect to,
Treasury Services (all such obligations, liabilities and indebtedness being
herein collectively called the "Treasury Service Obligations," and together with
the Loan Document Obligations and the Other Obligations, the "Guaranteed
Obligations"). Each Guarantor understands, agrees and confirms that the Secured
Creditors may enforce this Guaranty up to the full amount of the Guaranteed
Obligations against such Guarantor without proceeding against any other
Guarantor, the Borrower, against any security for the Obligations, or under any
other guaranty covering all or a portion of the Guaranteed Obligations.
2. Additionally, each Guarantor, jointly and severally,
unconditionally, absolutely and irrevocably, guarantees the payment of any and
all Guaranteed Obligations whether or not due or payable by the Borrower upon
the occurrence in respect of the Borrower of any of the events specified in
clauses (g) or (h) or Article VII of the Credit Agreement, and unconditionally
and irrevocably, jointly and severally, promises to pay such Guaranteed
Obligations to the Secured Creditors, or order, on demand, in legal tender of
the United States. This Guaranty shall constitute a guaranty of payment, and not
of collection.
3. The liability of each Guarantor hereunder is primary, absolute
and unconditional and is exclusive and independent of any security for or other
guaranty of the indebtedness of the Borrower whether executed by such Guarantor,
any other Guarantor, any other guarantor or by any other party, and the
liability of each Guarantor hereunder shall not be affected or impaired by any
circumstance or occurrence whatsoever, including, without limitation: (a) any
direction as to application of payment by the Borrower or by any other party,
(b) any other continuing or other guaranty, undertaking or maximum liability of
a guarantor or of any other party as to the Guaranteed Obligations, (c) any
payment on or in reduction of any such other guaranty or undertaking, (d) any
dissolution, termination or increase, decrease or change in personnel by the
Borrower, (e) any payment made to any Secured Creditor on the indebtedness which
any Secured Creditor repays the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceeding, and each Guarantor waives any right to the deferral or modification
of its obligations hereunder by reason of any such proceeding, (f) any action or
inaction by the Secured Creditors as contemplated in Section 6 hereof or (g) any
invalidity, irregularity or unenforceability of all or any part of the
Guaranteed Obligations or of any security therefor.
4. The obligations of each Guarantor hereunder are independent of
the obligations of any other Guarantor, any other guarantor or the Borrower, and
a separate action or actions may be brought and prosecuted against each
Guarantor whether or not action is brought against any other Guarantor, any
other guarantor or the Borrower and whether or not any other Guarantor, any
other guarantor or the Borrower be joined in any such action or actions. Each
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Guarantor waives, to the fullest extent permitted by law, the benefits of any
statute of limitations affecting its liability hereunder or the enforcement
thereof. Any payment by the Borrower or other circumstance which operates to
toll any statute of limitations as to the Borrower shall operate to toll the
statute of limitations as to each Guarantor.
5. Each Guarantor hereby waives notice of acceptance of this
Guaranty and notice of any liability to which it may apply, and waives
promptness, diligence, presentment, demand of payment, protest, notice of
dishonor or nonpayment of any such liabilities, suit or taking of other action
by the Administrative Agent or any other Secured Creditor against, and any other
notice to, any party liable thereon (including such Guarantor, any other
Guarantor, any other guarantor or the Borrower).
6. Any Secured Creditor may at any time and from time to time
without the consent of (except as provided below), or notice to, any Guarantor,
without incurring responsibility to such Guarantor, without impairing or
releasing the obligations of such Guarantor hereunder, upon or without any terms
or conditions and in whole or in part:
(a) change, in accordance with the provisions of the Credit
Agreement, the manner, place or terms of payment of, and/or change, increase or
extend the time of payment of, renew or alter, any of the Guaranteed Obligations
(including any increase or decrease in the rate of interest thereon or the
principal amount thereof), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the guaranty herein made shall
apply to the Guaranteed Obligations as so changed, extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, impair, realize upon or
otherwise deal with in any manner and in any order any property by whomsoever at
any time pledged or mortgaged to secure, or howsoever securing, the Guaranteed
Obligations or any liabilities (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and/or any offset
thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower, any Subsidiary thereof or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers, Guarantors,
other guarantors, the Borrower or other obligors;
(e) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may subordinate the
payment of all or any part thereof to the payment of any liability (whether due
or not) of the Borrower to creditors of the Borrower other than the Secured
Creditors;
(f) apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Secured Creditors regardless of
what liabilities of the Borrower remain unpaid;
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(g) consent to or waive any breach of, or any act, omission or
default under, any of the Interest Rate Protection/Currency Exchange Agreements,
the Loan Documents, the Treasury Service Agreement or any of the instruments or
agreements referred to therein, or otherwise amend, modify or supplement any of
the Interest Rate Protection/Currency Exchange Agreements, the Loan Documents,
the Treasury Service Agreement or any of such other instruments or agreements;
(h) act or fail to act in any manner referred to in this Guaranty
which may deprive such Guarantor of its right to subrogation against the
Borrower to recover full indemnity for any payments made pursuant to this
Guaranty; and/or
(i) take any other action which would, under otherwise applicable
principles of common law, give rise to a legal or equitable discharge of such
Guarantor from its liabilities under this Guaranty.
7. This Guaranty is a continuing one and all liabilities to which it
applies or may apply under the terms hereof shall be conclusively presumed to
have been created in reliance hereon. No failure or delay on the part of any
Secured Creditor in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein expressly specified are cumulative and not exclusive of any
rights or remedies which any Secured Creditor would otherwise have. No notice to
or demand on any Guarantor in any case shall entitle such Guarantor to any other
further notice or demand in similar or other circumstances or constitute a
waiver of the rights of any Secured Creditor to any other or further action in
any circumstances without notice or demand. It is not necessary for any Secured
Creditor to inquire into the capacity or powers of the Borrower or the officers,
directors, partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
8. Any indebtedness of the Borrower now or hereafter held by any
Guarantor is hereby subordinated to the indebtedness of the Borrower to the
Secured Creditors, and such indebtedness of the Borrower to any Guarantor, if
the Administrative Agent or the Collateral Agent, after the occurrence and
during the continuance of an Event of Default, so requests, shall be collected,
enforced and received by such Guarantor as trustee for the Secured Creditors and
be paid over to the Secured Creditors on account of the indebtedness of the
Borrower to the Secured Creditors, but without affecting or impairing in any
manner the liability of such Guarantor under the other provisions of this
Guaranty. Without limiting the generality of the foregoing, each Guarantor
hereby agrees with the Secured Creditors that it will not exercise any right of
subrogation which it may at any time otherwise have as a result of this Guaranty
(whether contractual, under Section 509 of the Bankruptcy Code or otherwise)
until all Guaranteed Obligations have been irrevocably paid in full in cash.
9. (a) Each Guarantor waives any right (except as shall be required
by applicable law and cannot be waived) to require the Secured Creditors to: (i)
proceed against the Borrower, any other Guarantor, any other guarantor of the
Guaranteed Obligations or any other party; (ii)
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proceed against or exhaust any security held from the Borrower, any other
Guarantor, any other guarantor of the Guaranteed Obligations or any other party;
or (iii) pursue any other remedy in the Secured Creditors' power whatsoever.
Each Guarantor waives any defense based on or arising out of any defense of the
Borrower, any other Guarantor, any other guarantor of the Guaranteed Obligations
or any other party other than payment in full of the Guaranteed Obligations,
including, without limitation, any defense based on or arising out of the
disability of the Borrower, any other Guarantor, any other guarantor of the
Guaranteed Obligations or any other party, or the unenforceability of the
Guaranteed Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower other than payment in full of the
Guaranteed Obligations. The Secured Creditors may, at their election, foreclose
on any security held by the Administrative Agent, the Collateral Agent or the
other Secured Creditors by one or more judicial or nonjudicial sales, whether or
not every aspect of any such sale is commercially reasonable, or exercise any
other right or remedy the Secured Creditors may have against the Borrower or any
other party, or any security, without affecting or impairing in any way the
liability of any Guarantor hereunder except to the extent the Guaranteed
Obligations have been paid in full in cash. Each Guarantor waives any defense
arising out of any such election by the Secured Creditors, even though such
election operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of such Guarantor against the Borrower or
any other party or any security.
(b) Each Guarantor waives all presentments, demands for performance,
protests and notices, including, without limitation, notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Guaranty,
and notices of the existence, creation or incurring of new or additional
indebtedness. Each Guarantor assumes all responsibility for being and keeping
itself informed of the Borrower's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks which such Guarantor
assumes and incurs hereunder, and agrees that the Secured Creditors shall have
no duty to advise any Guarantor of information known to them regarding such
circumstances or risks.
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10. The Secured Creditors agree that this Guaranty may be enforced
only by the action of the Administrative Agent or the Collateral Agent, in each
case acting upon the instructions of the Required Secured Creditors (as defined
in the Security Agreement) and that no other Secured Creditors shall have any
right individually to seek to enforce or to enforce this Guaranty or to realize
upon the security to be granted by the Security Documents. The Secured Creditors
further agree that this Guaranty may not be enforced against any director,
officer, employee, partner, member or stockholder of any Guarantor (except to
the extent such partner, member or stockholder is also a Guarantor hereunder).
11. In order to induce the Lenders to make Loans to, and issue
Letters of Credit for the account of, the Borrower pursuant to the Credit
Agreement, to induce the Other Creditors to execute, deliver and perform the
Interest Rate Protection/Currency Exchange Agreements and to induce the Treasury
Services Creditors to provide Treasury Services, each Guarantor represents,
warrants and covenants that:
(a) Each Guarantor is a corporation or other business entity duly
incorporated or organized (as the case may be), validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization (as
the case may be), and has all corporate or other relevant organizational powers
and all materials licenses, authorizations, consents and approvals of
Governmental Authorities required to carry on its business as now conducted. The
execution, delivery and performance by each Guarantor of this Guaranty are
within such Guarantor's corporate or other relevant organizational powers, have
been duly authorized by all corporate or other organizational action, require no
action by or in respect of, or filing with, any Governmental Authority and do no
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws (or equivalent
organizational documents) of any such Guarantor or of any judgment, injunction,
order or decree or any indenture, mortgage, deed of trust, credit agreement or
loan agreement, or any other material agreement or material instrument binding
upon such Guarantor or any of its Subsidiaries, and will not result in the
creation or imposition of any Lien (other than those contemplated by the
Security Documents) on such Guarantor or any of its Subsidiaries.
(b) Each Guarantor has duly executed and delivered this Guaranty and
this Guaranty constitutes each such Guarantor's legal, valid and binding
obligation enforceable in accordance with its terms.
(c) There are no actions, suits or proceedings pending or, to such
Guarantor's knowledge, threatened (i) with respect to this Guaranty or any other
Loan Document to which such Guarantor is a party or (ii) with respect to such
Guarantor or any of its Subsidiaries that, either individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
12. Each Guarantor covenants and agrees that on and after the
Effective Date and until the termination of the total Commitments (and the date
on which no further Commitments may be provided under the Credit Agreement), all
Interest Rate Protection/Currency Exchange Agreements and all Treasury Services
and until such time as no amount under any promissory notes (if any) issued
pursuant to the Credit Agreement or Letter of Credit remains outstanding
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and all Guaranteed Obligations have been paid in full, such Guarantor will
comply, and will cause each of its Subsidiaries to comply, with all of the
applicable provisions, covenants and agreements contained in Articles V and VI
of the Credit Agreement, and will take, or will refrain from taking, as the case
may be, all actions that are necessary to be taken or not taken so that it is
not in violation of any provision, covenant or agreement contained in Articles V
or VI of the Credit Agreement, and so that no Default is caused by the actions
of such Guarantor or any of its Subsidiaries.
13. The Guarantors hereby jointly and severally agree to pay all
reasonable out-of-pocket costs and expenses of incurred by (i) the Agents, the
Joint Book Managers, the Joint Lead Arrangers or any Issuing Lender while any
Specified Default exists (including the fees, charges and disbursements of each
such Person) in connection with the enforcement of this Guaranty and (ii) by the
Agents, the Joint Book Managers and the Joint Lead Arrangers in connection with
any amendment, waiver or consent relating hereto (including fees, charges and
disbursements of one counsel (plus any local counsel deemed reasonably necessary
or desirable by the Administrative Agent) for the Agents, the Joint Book
Managers and the Joint Lead Arrangers).
14. This Guaranty shall be binding upon each Guarantor and its
successors and assigns and shall inure to the benefit of the Secured Creditors
and their successors and assigns.
15. Neither this Guaranty nor any provision hereof may be changed,
waived, discharged or terminated except with the written consent of each
Guarantor directly affected thereby (it being understood and agreed that, for
this purpose, the release or modification of liabilities of any Guarantor
hereunder shall be deemed not to affect the remaining, or other, Guarantors) and
with the written consent of the Required Secured Creditors; provided, that any
change, waiver, modification or variance affecting the rights and benefits of a
single Class (as defined below) of Secured Creditors (and not all Secured
Creditors in a like or similar manner) shall also require the written consent of
the Requisite Creditors (as defined below) of such Class of Secured Creditors.
For the purpose of this Guaranty, the term "Class" shall mean each class of
Secured Creditors, i.e., whether (x) the Lender Creditors as holders of the Loan
Document Obligations, (y) the Other Creditors as the holders of the Other
Obligations or (z) the Treasury Service Creditors as holders of the Treasury
Service Obligations. For the purpose of this Guaranty, the term "Requisite
Creditors" of any Class shall mean (x) with respect to the Loan Document
Obligations, the Required Lenders, (y) with respect to the Other Obligations,
the holders of at least a majority of all Other Obligations outstanding from
time to time and (z) with respect to Treasury Service Obligations, the holders
of at least a majority of the Treasury Service Obligations outstanding from time
to time.
16. Each Guarantor acknowledges that an executed (or conformed) copy
of each of the Loan Documents has been made available to a senior officer of
such Guarantor and such officer is familiar with the contents thereof.
17. In addition to any rights now or hereafter granted under
applicable law (including, without limitation, Section 151 of the New York
Debtor and Creditor Law) and not
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by way of limitation of any such rights, upon the occurrence and during the
continuance of an Event of Default (such term to mean and include any "Event of
Default" as defined in the Credit Agreement and any payment default under any
Interest Rate Protection/Currency Exchange Agreement or the Treasury Service
Agreement, in either case continuing after any applicable grace period), each
Secured Creditor is hereby authorized, at any time or from time to time, without
notice to any Guarantor or to any other Person, any such notice being expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special) and any other indebtedness at any time held or owing by such Secured
Creditor to or for the credit or the account of such Guarantor, against and on
account of the obligations and liabilities of such Guarantor to such Secured
Creditor under this Guaranty, irrespective of whether or not such Secured
Creditor shall have made any demand hereunder and although said obligations,
liabilities, deposits or claims, or any of them, shall be contingent or
unmatured.
18. All notices and other communications provided for herein shall
be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, addressed to the
relevant party at (i) in the case of any Lender Creditor, as provided in the
Credit Agreement, (ii) in the case of any Guarantor, as provided in the Security
Agreement and (iii) in the case of any Other Creditor and any Treasury Service
Creditor, at such address as such Other Creditor or such Treasury Service
Creditor, as the case may be, shall have specified in writing to the Guarantors;
or in any case at such other address as any of the Persons listed above may
hereafter notify the others in writing. All notices and other communication
given to any party hereto in accordance with the provisions of this Guaranty
shall be deemed to have been given on the date of receipt.
19. If claim is ever made upon any Secured Creditor for repayment or
recovery of any amount or amounts received in payment or on account of any of
the Guaranteed Obligations and any of the aforesaid payees repays all or part of
said amount by reason of (i) any judgment, decree or order of any court or
administrative body having jurisdiction over such payee or any of its property
or (ii) any settlement or compromise of any such claim effected by such payee
with any such claimant (including the Borrower) then and in such event each
Guarantor agrees that any such judgment, decree, order, settlement or compromise
shall be binding upon such Guarantor, notwithstanding any revocation hereof or
other instrument evidencing any liability of the Borrower, and such Guarantor
shall be and remain liable to the aforesaid payees hereunder for the amount so
repaid or recovered to the same extent as if such amount had never originally
been received by any such payee.
20. (a) THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE SECURED
CREDITORS AND OF THE UNDERSIGNED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. Any legal action or proceeding
with respect to this Guaranty or any other Loan Document to which any Guarantor
is a party may be brought in the courts of the State of New York or of the
United States of America for the Southern District of New York in each case
which are located in the County of New York, and, by execution and delivery of
this Guaranty, each Guarantor hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. Each Guarantor hereby further irrevocably waives any claim
that any such court lacks personal jurisdiction over such Guarantor,
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and agrees not to plead or claim in any legal action or proceeding with respect
to this Guaranty or any other Loan Document to which such Guarantor is a party
brought in any of the aforesaid courts that any such court lacks personal
jurisdiction over such Guarantor. Each Guarantor further irrevocably consents to
the service of process out of any of the aforementioned courts in any such
action or proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to such Guarantor at its address set forth in the
Security Agreement, such service to become effective 30 days after such mailing.
Each Guarantor hereby irrevocably waives any objection to such service of
process and further irrevocably waives and agrees not to plead or claim in any
action or proceeding commenced hereunder or under any other Loan Document to
which such Guarantor is a party that such service of process was in any way
invalid or ineffective. Nothing herein shall affect the right of any of the
Secured Creditors to serve process in any other manner permitted by law or to
commence legal proceedings or otherwise proceed against each Guarantor in any
other jurisdiction.
(b) Each Guarantor hereby irrevocably waives (to the fullest extent
permitted by applicable law) any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Guaranty or any other Loan Document to which such
Guarantor is a party brought in the courts referred to in clause (a) above and
hereby further irrevocably waives and agrees not to plead or claim in any such
court that such action or proceeding brought in any such court has been brought
in an inconvenient forum.
(c) EACH GUARANTOR AND EACH SECURED CREDITOR (BY ITS ACCEPTANCE OF
THE BENEFITS OF THIS GUARANTY) HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO A TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS GUARANTY, THE OTHER LOAN DOCUMENTS TO WHICH SUCH GUARANTOR IS A PARTY OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
21. In the event that all of the Equity Interests of one or more
Guarantors are sold or otherwise disposed of (to one or more Persons other than
the Borrower and any Subsidiaries thereof) in a transaction that is permitted
under the Credit Agreement (or such sale or other disposition has been approved
in writing by the Required Lenders) and the proceeds of such sale or disposition
are applied in accordance with the provisions of the Credit Agreement, to the
extent applicable, such Guarantor shall upon consummation of such sale or other
disposition (to one or more Persons other than the Borrower and any Subsidiaries
thereof) be released from this Guaranty automatically and without further action
and this Guaranty shall, as to each such Guarantor or Guarantors, terminate, and
have no further force or effect (it being understood and agreed that the sale of
one or more Persons that own, directly or indirectly, all of the Equity
Interests of any Guarantor (to one or more Persons other than the Borrower and
any Subsidiaries thereof) shall be deemed to be a sale of such Guarantor for the
purposes of this Section 21). Upon the request, and at the expense, of the
Borrower, the Collateral Agent shall deliver an acknowledgment of a release of a
Guarantor or Guarantors pursuant to the preceding sentence; PROVIDED the
Borrower shall have delivered a certificate signed by a Financial Officer
certifying that such release is permitted pursuant to the provisions of such
preceding sentence.
10
22. At any time a payment in respect of the Guaranteed Obligations
is made under this Guaranty, the right of contribution of each Guarantor against
each other Guarantor shall be determined as provided in the immediately
following sentence, with the right of contribution of each Guarantor to be
revised and restated as of each date on which a payment (a "Relevant Payment")
is made on the Guaranteed Obligations under this Guaranty. At any time that a
Relevant Payment is made by a Guarantor that results in the aggregate payments
made by such Guarantor in respect of the Guaranteed Obligations to and including
the date of the Relevant Payment exceeding such Guarantor's Contribution
Percentage (as defined below) of the aggregate payments made by all Guarantors
in respect of the Guaranteed Obligations to and including the date of the
Relevant Payment (such excess, the "Aggregate Excess Amount"), each such
Guarantor shall have a right of contribution against each other Guarantor who
has made payments in respect of the Guaranteed Obligations to and including the
date of the Relevant Payment in an aggregate amount less than such other
Guarantor's Contribution Percentage of the aggregate payments made to and
including the date of the Relevant Payment by all Guarantors in respect of the
Guaranteed Obligations (the aggregate amount of such deficit, the "Aggregate
Deficit Amount") in an amount equal to (x) a fraction the numerator of which is
the Aggregate Excess Amount of such Guarantor and the denominator of which is
the Aggregate Excess Amount of all Guarantors multiplied by (y) the Aggregate
Deficit Amount of such other Guarantor. A Guarantor's right of contribution
pursuant to the preceding sentences shall arise at the time of each computation,
subject to adjustment at the time of each computation; provided, that no
Guarantor may take any action to enforce such right until the Guaranteed
Obligations have been irrevocably paid in full in cash, it being expressly
recognized and agreed by all parties hereto that any Guarantor's right of
contribution arising pursuant to this Section 22 against any other Guarantor
shall be expressly junior and subordinate to such other Guarantor's obligations
and liabilities in respect of the Guaranteed Obligations and any other
obligations owing under this Guaranty. As used in this Section 22: (i) each
Guarantor's "Contribution Percentage" shall mean the percentage obtained by
dividing (x) the Adjusted Net Worth (as defined below) of such Guarantor by (y)
the aggregate Adjusted Net Worth of all Guarantors; (ii) the "Adjusted Net
Worth" of each Guarantor shall mean the greater of (x) the Net Worth (as defined
below) of such Guarantor and (y) zero; and (iii) the "Net Worth" of each
Guarantor shall mean the amount by which the fair salable value of such
Guarantor's assets on the date of any Relevant Payment exceeds its existing
debts and other liabilities (including contingent liabilities, but without
giving effect to any Guaranteed Obligations arising under this Guaranty) on such
date. Notwithstanding anything to the contrary contained above, any Guarantor
that is released from this Guaranty pursuant to Section 21 hereof shall
thereafter have no contribution obligations, or rights, pursuant to this Section
22, and at the time of any such release, if the released Guarantor had an
Aggregate Excess Amount or an Aggregate Deficit Amount, same shall be deemed
reduced to $0, and the contribution rights and obligations of the remaining
Guarantors shall be recalculated on the respective date of release (as otherwise
provided above) based on the payments made hereunder by the remaining
Guarantors. All parties hereto recognize and agree that, except for any right of
contribution arising pursuant to this Section 22, each Guarantor who makes any
payment in respect of the Guaranteed Obligations shall have no right of
contribution or subrogation against any other Guarantor in respect of such
payment until all of the Guaranteed Obligations have been irrevocably paid in
full in cash. Each of the Guarantors recognizes and acknowledges that the rights
to contribution arising hereunder shall constitute an asset in favor of the
party entitled to such contribution. In this connection, each Guarantor has the
right to waive
11
its contribution right against any Guarantor to the extent that after giving
effect to such waiver such Guarantor would remain solvent, in the determination
of the Required Lenders.
23. Each Guarantor and each Secured Creditor (by its acceptance of
the benefits of this Guaranty) hereby confirms that it is its intention that
this Guaranty not constitute a fraudulent transfer or conveyance for purposes of
the Bankruptcy Code, the Uniform Fraudulent Conveyance Act of any similar
Federal or state law. To effectuate the foregoing intention, each Guarantor and
each Secured Creditor (by its acceptance of the benefits of this Guaranty)
hereby irrevocably agrees that the Guaranteed Obligations guaranteed by such
Guarantor shall be limited to such amount as will, after giving effect to such
maximum amount and all other (contingent or otherwise) liabilities of such
Guarantor that are relevant under such laws (excluding, to the maximum extent
permitted by law, any guarantee by such Guarantor of any Indebtedness (other
then the Guaranteed Obligations) of the Borrower), and after giving effect to
any rights to contribution pursuant to any agreement providing for an equitable
contribution among such Guarantor and other Guarantors, result in the Guaranteed
Obligations of such Guarantor in respect of such maximum amount not constituting
a fraudulent transfer or conveyance.
24. This Guaranty may be executed in any number of counterparts and
by the different parties hereto on separate counterparts, each of which when so
executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument. A set of counterparts executed by all
the parties hereto shall be lodged with the Guarantors and the Administrative
Agent.
25. All payments made by any Guarantor hereunder will be made
without setoff, counterclaim or other defense and on the same basis as payments
are made by the Borrower under Sections 2.18 and 2.19(a) of the Credit
Agreement.
26. It is understood and agreed that any Subsidiary of the Borrower
that is required to become a party to this Guaranty after the date hereof
pursuant to the requirements of the Credit Agreement shall become a Guarantor
hereunder by (x) executing a counterpart hereof and/or joinder agreement, in
each case in form and substance satisfactory to the Administrative Agent, and
(y) taking all actions as specified in this Guaranty as would have been taken by
such Guarantor had it been an original party to this Guaranty, in each case with
all documents and actions required to be taken above to be to the reasonable
satisfaction of the Administrative Agent.
* * *
12
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be
executed and delivered as of the date first above written.
ABCO FOOD GROUP, INC., as a Guarantor
By: /s/Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
ABCO MARKETS INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
ABCO REALTY CORP., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
AG, L.L.C., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
AMERICAN LOGISTICS GROUP, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXX'X FOOD GROUP, INC., as a
Guarantor
By: /s/Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
CARDINAL WHOLESALE, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX FUELS, INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
FAVAR CONCEPTS, LTD., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX FOODS MANAGEMENT CO., L.L.C.,
as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX FOODS OF TEXAS, L.P., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX INTERNATIONAL LTD., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX SUPERMARKETS OF FLORIDA, INC.,
as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX TRANSPORTATION SERVICE, INC.,
as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXX WHOLESALE, INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
FOOD 4 LESS BEVERAGE COMPANY, INC., as
a Guarantor
By: /s/Xxxxxxx Xxxx
--------------------------------
Name: Xxxxxxx Xxxx
Title: President
FUELSERV, INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
GATEWAY INSURANCE AGENCY, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
HEAD DISTRIBUTING COMPANY, as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
LAS, INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXX-XXXXXXX CO., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
PIGGLY WIGGLY COMPANY, as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
PROGRESSIVE REALTY, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
RAINBOW FOOD GROUP, INC., as a
Guarantor
By: /s/Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
RETAIL INVESTMENTS, INC., as a
Guarantor
By: /s/Xxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
RETAIL SUPERMARKETS, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
RFS MARKETING SERVICES, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
RICHMAR FOODS, INC., as a Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
XXXXXXXX TRANSPORTATION, INC., as a
Guarantor
By: /s/Xxxxxx X. Xxxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Secretary
CORE-XXXX INTERNATIONAL, INC., as a
Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
CORE-XXXX INTERRELATED COMPANIES,
INC., as a Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
CORE-XXXX MIDCONTINENT, INC., as a
Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
C/M PRODUCTS, INC., as a Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
ASI OFFICE AUTOMATION, INC., as a
Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
XX XXXXXX DISTRIBUTORS, LTD., as a
Guarantor
By: /s/Xxxx Xxxxxx
--------------------------------
Name: Xxxx Xxxxxx
Title: President
GENERAL ACCEPTANCE CORPORATION, as a
Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
MARQUISE VENTURES COMPANY, INC., as a
Guarantor
By: /s/Xxx X. Xxxxxx
--------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President, Chief
Financial Officer and
Secretary
Agreed and accepted by:
DEUTSCHE BANK TRUST
COMPANY AMERICAS, as
Administrative Agent
By: /s/ Xxxxxxxxxx Xxxxxx
------------------------------
Name: Xxxxxxxxxx Xxxxxx
Title: Vice President
