EXHIBIT 4.6
LIMITED GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of June 7, 2002 (the "Guaranty
Agreement"), is made by IPCH ACQUISITION CORP., a Delaware corporation (the
"Guarantor"), in favor of the holders from time to time of the Notes described
below (the "Noteholders").
WHEREAS, Inergy Propane, LLC, a Delaware limited liability company (the
"Company"), and the Purchasers named on the Purchaser Schedule thereto
(collectively, the "Purchasers") have entered into a Note Purchase Agreement
dated as of even date herewith (as the same may be amended, restated,
supplemented, or otherwise modified from time to time, the "Note Agreement";
capitalized terms used and otherwise not defined herein have the definitions set
forth in the Note Agreement) pursuant to which the Company has issued and sold
to the Purchasers (i) $35,000,000 aggregate principal amount of its 8.85% Senior
Secured Notes, Series A, due June 7, 2007 (the "Series A Notes"), (ii)
$25,000,000 aggregate principal amount of its 9.10% Senior Secured Notes, Series
B, due June 6, 2008 (the "Series B Notes"), and (iii) $25,000,000 aggregate
principal amount of its 9.34% Senior Secured Notes, Series C, due June 5, 2009
(the "Series C Notes" and, together with the Series A Notes and the Series B
Notes, collectively, the "Notes"; which term shall include any notes issued in
substitution or exchange for any of the foregoing pursuant to the terms of the
Note Agreement);
WHEREAS, the Guarantor is the owner of certain equity interests in Inergy,
L.P., a Delaware limited partnership of which the Company is a Wholly-Owned
Subsidiary; and
WHEREAS, it is a condition to the agreement of the Purchasers to purchase
the Notes that this Guaranty Agreement shall have been executed and delivered by
the Guarantor and shall be in full force and effect;
NOW THEREFORE, in order to induce, and in consideration of, the execution
and delivery of the Note Agreement and the purchase of the Notes by the
Purchasers, the Guarantor hereby covenants and agrees with, and represents and
warrants to the Noteholders as follows:
1. THE GUARANTY. The Guarantor hereby irrevocably and unconditionally
guarantees to each Noteholder the due and punctual payment in full of (i)
the principal of, Make-Whole Amount, if any, and interest on (including
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating
to the Company, whether or not a claim for post-filing or post-petition
interest is allowed in such proceeding), and any other amounts due under,
the Notes when and as the same shall become due and payable (whether at
stated maturity or by required or optional prepayment or by acceleration or
otherwise) and (ii) any other
sums which may become due under the terms and provisions of the Note
Agreement, the Notes or any other Note Document (all such obligations
described in clauses (i) and (ii) above are herein called the "Guaranteed
Obligations"). The guaranty in the preceding sentence is an absolute,
present and continuing guaranty of payment and not of collectibility and is
in no way conditional or contingent upon any attempt to collect from the
Company or any other guarantor of the Notes or upon any other action,
occurrence or circumstance whatsoever. In the event that the Company shall
fail so to pay any of such Guaranteed Obligations, the Guarantor agrees to
pay the same when due to the Noteholders entitled thereto, without demand,
presentment, protest or notice of any kind, in lawful money of the United
States of America, at the place for payment specified in the Notes and the
Note Agreement. Each default in payment of principal of, Make-Whole Amount,
if any, or interest on any Note shall give rise to a separate cause of
action hereunder and separate suits may be brought hereunder as each cause
of action arises. The Guarantor hereby agrees that the Notes issued in
connection with the Note Agreement may make reference to this Guaranty
Agreement.
The Guarantor hereby agrees to pay and to indemnify and save each
Noteholder harmless from and against any damage, loss, cost or expense
(including attorneys' fees) which such Noteholder may incur or be subject
to as a consequence, direct or indirect, of (i) any breach by the Guarantor
or by the Company of any warranty, covenant, term or condition in, or the
occurrence of any default under, this Guaranty Agreement, the Notes, the
Note Agreement or any other Note Document, together with all expenses
resulting from the compromise or defense of any claims or liabilities
arising as a result of any such breach or default, and (ii) any legal
action commenced to challenge the validity or enforceability of this
Guaranty Agreement, the Notes, the Note Agreement or any other Note
Document.
Notwithstanding the foregoing or any other provisions of this Guaranty
Agreement, it is agreed and understood that the Guarantor shall not be
required to pay hereunder at any time more than the Maximum Guaranteed
Amount determined as of such time. The Guarantor agrees that the
Guaranteed Obligations may at any time exceed the sum of the Maximum
Guaranteed Amount, without affecting or impairing the obligation of the
Guarantor. "Maximum Guaranteed Amount" means as of the date of
determination, the lesser of (a) $35,000,000 and (b) the maximum amount
that would not render the Guarantor's liability under this Guaranty
Agreement subject to avoidance under Section 548 of the United States
Bankruptcy Code (or any successor provision) or any comparable provision of
applicable state law; provided, however, that (i) the foregoing limitation
shall not limit or otherwise affect the Guarantor's liability under this
Guaranty Agreement to pay any expenses (including, without limitation,
attorney's fees and expenses, whether or not litigation is commenced, and
during both the trial and any appellate phases of litigation) incurred by
the Noteholders in enforcing any rights under this Guaranty Agreement, and
(ii) no payment or prepayment of any Notes or other obligations under the
Note Agreement or any other Note Document, by the Company or any other
Person, and no foreclosure or other realization by the Collateral Agent or
the Noteholders of any Collateral shall reduce the Guaranteed Obligations
(except to the extent the sum of all obligations of the Company under the
Notes, the Note Agreement
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and the other Note Documents is less than $35,000,000 at the time
enforcement of this Guaranty Agreement is sought).
2. OBLIGATIONS ABSOLUTE. The obligations of the Guarantor hereunder shall be
primary, absolute, irrevocable and unconditional, irrespective of the
validity, regularity or enforceability of the Notes, of the Note Agreement
or of the other Note Documents, shall not be subject to any counterclaim,
setoff, deduction or defense based upon any claim the Guarantor may have
against the Company or any Noteholder or otherwise, and shall remain in
full force and effect without regard to, and shall not be released,
discharged or in any way affected by, any circumstance or condition
whatsoever (whether or not the Guarantor shall have any knowledge or notice
thereof), including, without limitation: (a) any amendment, modification of
or supplement to the Note Agreement, the Notes, or any other Note Document
(except that the obligations of the Guarantor hereunder shall apply to the
Note Agreement, the Notes or such other Note Document as so amended,
modified or supplemented) or any assignment or transfer of any thereof or
of any interest therein, or any furnishing, acceptance or release of any
security for the Notes; (b) any waiver, consent, extension, indulgence or
other action or inaction under or in respect of the Notes or in respect of
the Note Agreement or any other Note Document; (c) any bankruptcy,
insolvency, readjustment, composition, liquidation or similar proceeding
with respect to the Company or its property; (d) any merger, amalgamation
or consolidation of the Guarantor or of the Company into or with any other
entity or any sale, lease or transfer of any or all of the assets of the
Guarantor or of the Company to any person; (e) any failure on the part of
the Company for any reason to comply with or perform any of the terms of
any other agreement with the Guarantor; or (f) any other circumstance which
might otherwise constitute a legal or equitable discharge or defense of a
guarantor. The Guarantor covenants that its obligations hereunder will not
be discharged except by payment and performance in full of all of the
Guaranteed Obligations.
3. WAIVER. The Guarantor unconditionally waives to the fullest extent
permitted by law, (a) notice of acceptance hereof, of any action taken or
omitted in reliance hereon and of any defaults by the Company in the
payment of any amounts due under the Notes, the Note Agreement or the other
Note Documents, and of any of the matters referred to in paragraph 2
hereof; (b) all notices which may be required by statute, rule of law or
otherwise to preserve any of the rights of each Noteholder against the
Guarantor, including, without limitation, presentment to or demand for
payment from the Company or the Guarantor with respect to any Note, notice
to the Company or to the Guarantor of default or protest for nonpayment or
dishonor and the filing of claims with a court in the event of the
bankruptcy of the Company; (c) any right to the enforcement, assertion or
exercise by any Noteholder of any right, power or remedy conferred in this
Guaranty Agreement, the Note Agreement, the Notes or the other Note
Documents; (d) any requirement or diligence on the part of any Noteholder;
and (e) any other act or omission or thing or delay to do any other act or
thing which might in any manner or to any extent vary the risk of the
Guarantor or which might otherwise operate as a discharge of the Guarantor.
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4. OBLIGATIONS UNIMPAIRED. The Guarantor authorizes the Noteholders, without
notice or demand to the Guarantor and without affecting its obligations
hereunder, from time to time (a) to renew, compromise, extend, accelerate
or otherwise change the time for payment of, or otherwise change the terms
of, all or any part of the Notes, the Note Agreement, any other Note
Document or any other instrument referred to therein; (b) to take and hold
security for the payment of the Notes, for the performance of this Guaranty
Agreement or otherwise for the Indebtedness guaranteed hereby and to
exchange, enforce, waive and release any such security; (c) to apply any
such security and to direct the order or manner of sale thereof as the
Noteholders in their sole discretion may determine; (d) to obtain
additional or substitute endorsers or guarantors; (e) to exercise or
refrain from exercising any rights against the Company and others; and (f)
to apply any sums, by whomsoever paid or however realized, to the payment
of the principal of, Make-Whole Amount, if any, and interest on the Notes
and any other Guaranteed Obligations hereunder. The Guarantor waives any
right to require the Noteholders to proceed against any additional or
substitute endorsers or guarantors or to pursue or exhaust any security
provided by the Company, the Guarantor or any other person or to pursue any
other remedy available to such Noteholders.
5. SUBROGATION. The Guarantor will not (a) exercise, and hereby subordinates
to the rights of the Noteholders, any rights which it may have acquired by
way of subrogation under this Guaranty Agreement, by any payment made
hereunder or otherwise, or (b) accept any payment on account of such
subrogation rights, or any rights of reimbursement, indemnity, exoneration
or contribution, any right to participate in any claim or any rights or
recourse to any security for the Notes or this Guaranty Agreement unless
and until all of the obligations, undertakings or conditions to be
performed or observed by the Company pursuant to the Notes, the Note
Agreement and the other Note Documents at the time of the Guarantor's
exercise of any such right shall have been performed, observed or paid in
full.
For a period of one year after the payment in full of the Guaranteed
Obligations, the Guarantor hereby waives (x) all rights of subrogation
which it may at any time otherwise have as a result of this Guaranty
Agreement (whether statutory or otherwise) to the claims of the Noteholders
against the Company or any other guarantor of the Guaranteed Obligations
(each referred to herein as the "Other Party") and all contractual,
statutory or common law rights of reimbursement, contribution or indemnity
from any Other Party which it may at any time otherwise have as a result of
this Guaranty Agreement; (y) any right to enforce any other remedy which
the Noteholders now have or may hereafter have against any Other Party, any
endorser or any other guarantor of all or any part of the Guaranteed
Obligations; and (z) all claims (as such term is defined in the Bankruptcy
Code) it may at any time otherwise have against any Other Party arising
from any transaction whatsoever, including without limitation its right to
assert or enforce any such claims.
6. REINSTATEMENT OF GUARANTY. This Guaranty Agreement shall continue to be
effective, or be reinstated, as the case may be, if and to the extent at
any time payment, in
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whole or in part, of any of the sums due to any Noteholder for principal,
Make-Whole Amount, if any, or interest on the Notes or any of the other
Guaranteed Obligations is rescinded or must otherwise be restored or
returned by such Noteholder upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Company, or upon or as a result of the
appointment of a custodian, receiver, trustee or other officer with similar
powers with respect to the Company or any substantial part of its property,
or otherwise, all as though such payments had not been made. If an event
permitting the acceleration of the maturity of the principal amount of the
Notes shall at any time have occurred and be continuing and such
acceleration shall at such time be prevented or the right of any Noteholder
to receive any payment under any Note shall at such time be delayed or
otherwise affected by reason of the pendency against the Company of a case
or proceeding under a bankruptcy or insolvency law, the Guarantor agrees
that, for purposes of this Guaranty Agreement and its obligations
hereunder, the maturity of such principal amount shall be deemed to have
been accelerated with the same effect as if the Noteholders had accelerated
the same in accordance with the terms of the Note Agreement, and the
Guarantor shall forthwith pay such accelerated principal amount, accrued
interest and Make-Whole Amount, if any, thereon and any other amounts
guaranteed hereunder.
7. RANK OF GUARANTY. The Guarantor agrees that its obligations under this
Guaranty Agreement shall rank at least pari passu with all other senior
obligations of the Guarantor now or hereafter existing and senior to all
obligations owed by the Guarantor to any Affiliate of the Guarantor.
8. REPRESENTATIONS AND WARRANTIES OF THE GUARANTOR.
The Guarantor represents and warrants as follows:
(a) Organization, Good Standing and Location. The Guarantor is (i)
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (ii) duly qualified and authorized to do
business and in good standing in every other jurisdiction where the nature
of its business requires such qualification and (iii) has all requisite
organizational power and authority, and all governmental licenses and
permits, to own and operate its properties and to carry on its businesses
as presently conducted. The Guarantor has the requisite organizational
power to enter into and perform its obligations under this Guaranty
Agreement.
(b) Approval and Enforceability of Guaranty Agreement. The execution,
delivery and performance of this Guaranty Agreement have been duly
authorized by all necessary organizational action on the part of the
Guarantor. The Guaranty Agreement has been duly and validly executed and
delivered and constitutes the legal, valid and binding obligation of the
Guarantor, enforceable against it in accordance with its terms, subject to
(i) applicable bankruptcy, insolvency, moratorium, reorganization,
receivership and similar laws affecting the rights and remedies of
creditors generally, and (ii) general principles of equity (regardless of
whether such enforceability is considered in a
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proceeding in equity or at law).
(c) Compliance of Agreement with Laws, Etc. The execution, delivery
and performance by the Guarantor of this Guaranty will not, by the passage
of time, the giving of notice or otherwise, (i) require any consent,
approvals or authorization from any Governmental Authority or violate any
provision of any statute or other rule or regulation of any Governmental
Authority relating to the Guarantor, (ii) conflict with, result in a breach
of or constitute a default under the articles of formation, partnership
agreement or other organizational documents of the Guarantor or any
indenture, agreement or instrument to which the Guarantor is a party or by
which any of its properties may be bound or affected or any order,
judgment, decree or ruling of any court, arbitrator or Governmental
Authority applicable to the Guarantor, or (iii) result in or require the
creation or imposition of any Lien upon or with respect to any property now
owned or hereafter acquired by the Guarantor.
(d) Applicability of Note Agreement Representations. The Noteholders
shall be entitled to rely on any representation or warranty contained in
Section 5 of the Note Agreement and applicable to the Guarantor as if such
representation or warranty was made by the Guarantor herein.
9. NOTICES. Unless otherwise specifically provided herein, all notices,
consents, directions, approvals, instructions, requests and other
communications required or permitted by the terms hereof shall be in
writing, and any such communication shall become effective when received,
addressed in the following manner: (a) if to the Guarantor, to the address
set forth on the signature page hereto or (b) if to any Noteholder, to the
respective addresses set forth in the Purchaser Schedule to the Note
Agreement or such other address specified by such Noteholder to the
Guarantor in writing; provided, however, that any such addressee may change
its address for communications by notice given as aforesaid to the other
parties hereto.
10. CONSTRUCTION. The paragraph and subparagraph headings in this Guaranty
Agreement are for convenience of reference only and shall neither be deemed
to be a part of this Guaranty Agreement nor modify, define, expand or limit
any of the terms or provisions hereof. All references herein to numbered
paragraphs, unless otherwise indicated, are to paragraphs of this Guaranty
Agreement. Words and definitions in the singular shall be read and
construed as though in the plural and vice versa, and words in the
masculine, neuter or feminine gender shall be read and construed as though
in either of the other genders where the context so requires.
11. SEVERABILITY. If any provision of this Guaranty Agreement, or the
application thereof to any person or circumstances, shall, for any reason
or to any extent, be invalid or unenforceable, such invalidity or
unenforceability shall not in any manner affect or render invalid or
unenforceable the remainder of this Guaranty Agreement, and the application
of that provision to other persons or circumstances shall not be affected
but, rather, shall be enforced to the extent permitted by applicable law.
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12. SUCCESSORS. The terms and provisions of this Guaranty Agreement shall be
binding upon and inure to the benefit of the Guarantor and the Noteholders
from time to time and their respective permitted successors, transferees
and assigns.
13. ENTIRE AGREEMENT; AMENDMENT. This Guaranty Agreement expresses the entire
understanding of the subject matter hereof; and all other understandings,
written or oral, are hereby merged herein and superseded. No amendment of
or supplement to this Guaranty Agreement, or waiver or modification of, or
consent under, the terms hereof shall be effective unless in writing and
signed by the party to be bound thereby.
14. TERM OF GUARANTY AGREEMENT. The Guaranty Agreement and all guarantees,
covenants and agreements of the Guarantor contained herein shall continue
in full force and effect and shall not be discharged until such time as all
of the Guaranteed Obligations shall be indefeasibly paid or otherwise
discharged in full.
15. SURVIVAL. All warranties, representations and covenants made by the
Guarantor herein or in any certificate or other instrument delivered by it
or on its behalf under this Guaranty Agreement shall be considered to have
been relied upon by the Noteholders and shall survive the execution and
delivery of this Guaranty Agreement, regardless of any investigation made
by the Noteholders or on their behalf.
16. FURTHER ASSURANCES. The Guarantor hereby agrees to execute and deliver all
such instruments and take all such action as the Required Holders may from
time to time reasonably request in order to effectuate fully the purposes
of this Guaranty Agreement.
17. GOVERNING LAW. THIS GUARANTY AGREEMENT HAS BEEN EXECUTED AND DELIVERED IN
THE STATE OF NEW YORK AND SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN
ALL RESPECTS IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY THEREIN, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
18. WAIVER OF JURY TRIAL; SUBMISSION TO JURISDICTION; WAIVER OF IMMUNITIES.
(a) THE GUARANTOR AGREES TO WAIVE ITS RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY
AGREEMENT, THE NOTES, ANY OTHER NOTE DOCUMENT OR ANY DEALINGS RELATING TO
THE SUBJECT MATTER OF THE TRANSACTIONS CONTEMPLATED BY THE NOTE DOCUMENTS,
AND THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE
OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THE
TRANSACTIONS
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CONTEMPLATED BY THE NOTE DOCUMENTS, INCLUDING WITHOUT LIMITATION, CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. THE GUARANTOR ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO THE NOTEHOLDERS TO ENTER INTO THE NOTE AGREEMENT AND PURCHASE
THE NOTES PURCHASED BY IT, THAT EACH NOTEHOLDER HAS ALREADY RELIED ON THIS
WAIVER IN ENTERING INTO THE NOTE AGREEMENT AND PURCHASING THE NOTES
PURCHASED BY IT, AND THAT EACH NOTEHOLDER WILL CONTINUE TO RELY ON THE
WAIVER IN ITS RELATED FUTURE DEALINGS WITH THE COMPANY AND THE GUARANTOR.
THE GUARANTOR FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES
ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE
EVENT OF LITIGATION, THIS GUARANTY AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
(b) The Guarantor hereby irrevocably submits itself to the
jurisdiction of the Supreme Court of the State of New York, New York
County, of the United States of America and to the jurisdiction of the
United States District Court for the Southern District of New York, for the
purpose of any suit, action or other proceeding arising out of, or relating
to, this Guaranty Agreement, any other Note Document, or the subject matter
hereof or thereof, and the Guarantor hereby waives, and agrees not to
assert, by way of motion, as a defense or otherwise, in any such suit,
action or proceedings, any claim that it is not personally subject to the
jurisdiction of the above-named courts for any reason whatsoever, that such
suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. The Guarantor hereby
agrees that process may be served on Corporation Service Company, located
at 00 Xxxxx Xxxxxx, Xxxxxx, XX 00000. Any and all service of process and
any other notice in any such action, suit or proceeding shall be effective
against such parties if given by registered or certified mail, return
receipt requested, or by any other means or mail which requires a signed
receipt, postage prepaid, mailed to such parties has herein provided in
paragraph 9. During the term of this Guaranty Agreement, in the event
Corporation Service Company shall not be able to accept service of process
as aforesaid and if the Guarantor shall not maintain an office in New York
City, the Guarantor shall, promptly appoint and maintain an agent qualified
to act as an agent for service of process with respect to all courts in and
of New York City, and acceptable to the holders of the Notes, as the
Guarantor's authorized agent to accept and acknowledge on the Guarantor's
behalf service of any and all process which may be served in any such
action, suit or proceeding. The Guarantor agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided
by law. Nothing in this paragraph 18 shall affect the right of any
Noteholder to serve legal process in any other manner permitted by law or
affect the right of any Noteholder to bring any action or proceeding
against the Guarantor or its respective property in the courts of any
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other jurisdiction.
The Guarantor hereby agrees that the submission to jurisdiction
referred to in this paragraph 18 shall not limit in any manner the rights
of any of the Noteholders to take proceedings against the Guarantor in some
other court of competent jurisdiction whether within or outside the United
States.
[Remainder of this page blank; signature page follows]
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty Agreement
to be duly executed and delivered as of the date and year first above written.
IPCH ACQUISITION CORP.
By:________________________________
Xxxx X. Xxxxxxx
President and Chief Executive Officer
Notice address for
the above Guarantor:
c/o Inergy Propane, LLC
0000 Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Signature Page to Guaranty Agreement
