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EXHIBIT 4.12
SUBSIDIARY GUARANTEE
Each Guarantor hereby, jointly and severally, unconditionally
guarantees to each Holder of a 10-1/4% Senior Subordinated Note due 2007 (a
"Senior Subordinated Note") of Key Plastics, Inc., a Michigan corporation (the
"Company") authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability of
the Indenture, the Senior Subordinated Notes and the Obligations of the Company
hereunder and thereunder, that: (a) the principal of, premium, if any, interest
and Liquidated Damages, if any, on the Notes will be promptly paid in full when
due, subject to any applicable grace period, whether at maturity, by
acceleration, redemption or otherwise, and interest on the overdue principal,
premium, if any (to the extent permitted by law), interest on any interest, if
any, and Liquidated Damages, if any, on the Notes, and all other payment
Obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full and performed, all in accordance with
the terms hereof and thereof; and (b) in case of any extension of time of
payment or renewal of any Notes or any of such other Obligations, the same will
be promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, subject to any applicable grace period, whether at
stated maturity, by acceleration, redemption or otherwise. Failing payment when
so due of any amount so guaranteed or any performance so guaranteed for
whatever reason the Guarantors will be jointly and severally obligated to pay
the same immediately.
The obligations of each Guarantor to the Holders of Notes and to the
Trustee pursuant to this Subsidiary Guarantee and the Indenture are expressly
set forth in Article 11 of the Indenture and reference is hereby made to such
Indenture for the precise terms of this Subsidiary Guarantee. THE TERMS OF
ARTICLE 11 OF THE INDENTURE ARE INCORPORATED HEREIN BY REFERENCE. In the case
of any discrepancy between this writing and Article 11 of the Indenture,
Article 11 of the Indenture shall control.
This is a continuing Subsidiary Guarantee and shall remain in full
force and effect and shall be binding upon each Guarantor and its successors
and assigns until full, final and indefeasible payment of all of the Company's
obligations under the Notes and the Indenture (subject to Section 11.04 of the
Indenture) and shall inure to the benefit of the successors and assigns of the
Trustee and the Holders of Notes and, in the event of any transfer or assignment
of rights by any Holder of Notes or the Trustee, the rights and privileges
herein conferred upon the party shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.
This is a Subsidiary Guarantee of payment and not a guarantee of collection.
For purposes hereof, each Guarantor's liability shall be limited to the
lesser of (i) the aggregate amount of the Obligations of the Company under the
Senior Subordinated Notes and the Indenture and (ii) the amount, if any, which
would not have (A) rendered such Guarantor "insolvent" (as such term is defined
in the United States Bankruptcy Code and in the Debtor and Creditor Law of the
State of New York) or (B) left such Guarantor with unreasonably small capital
at the time its Subsidiary Guarantee of the Senior Subordinated Notes was
entered into; provided that it will be a presumption in any lawsuit or other
proceeding in which a Guarantor is a party that the amount guaranteed pursuant
to the Subsidiary Guarantee is the amount set forth in clause (i) above unless
any creditor, or representative of creditors of such Guarantor, or debtor in
possession or trustee in bankruptcy of the Guarantor, otherwise proves in such
a lawsuit that the aggregate liability of the Guarantor is the amount set forth
in clause (ii) above. The Indenture provides that, in making any determination
as to solvency or sufficiency of capital of a Guarantor in accordance with the
previous sentence, the right of such Guarantor to contribution from other
Guarantors, and any other rights such Guarantor may have, contractual or
otherwise, shall be taken into account.
This Subsidiary Guarantee shall not be valid or obligatory for any
purpose until the certificate of authentication of the Senior Subordinated Note
upon which this Guarantee is noted shall have been executed by the Trustee
under the Indenture by the manual signature of one of its authorized officers.
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Capitalized terms used herein have the same meanings given in the
Indenture unless otherwise indicated.
KEY PLASTICS AUTOMOTIVE L.L.C.
By: KEY PLASTICS, INC., Member
By:________________________________
Name: Xxxx X. Xxxx
Title: Treasurer and Assistant Secretary
Xxxxx X. Xxxxxx, Member
By:_________________________________
Xxxx X. Xxxx, Attorney-in-Fact
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