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Guaranty
From
WICOR, INC.
To and For the Benefit of
ABN AMRO BANK N.V.
Dated
March 29, 1996
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GUARANTY
THIS GUARANTY is made this 29th day of March, 1996, by and from
WICOR, INC., a Wisconsin corporation (the "Company"), to and for the benefit
of ABN AMRO BANK N.V., a bank organized under the laws of the Netherlands (the
"Bank").
W I T N E S S E T H:
WHEREAS, the Company has requested the Bank to extend credit to
the Wisconsin Gas Company Employees' Savings Plans Trust (the "Trust"), the
Trust forming a part of the Wisconsin Gas Company Employees' Savings Plan (the
"ESOP") which has been established by Wisconsin Gas Company, a Wisconsin
corporation and a subsidiary of the Company ("Wisconsin Gas"), and the Bank
has extended credit and/or may in the future extend credit by reason of such
request and in reliance upon this Guaranty; and
WHEREAS, the Bank requires additional assurances and guarantees by
the Company as one of the conditions for making loans or advances to or for
the benefit of the Trust; and
WHEREAS, the Company acknowledges the receipt of considerable
benefits by the advancement of credit to the Trust;
NOW, THEREFORE, in consideration of the Five Million Eleven
Thousand, Two Hundred Forty-Eight Dollar ($5,011,248.00) loan extended and/or
to be extended by the Bank to the Trust under the Loan Agreement hereinafter
referred to, and for other consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company agrees as follows:
SECTION 1. DEFINITIONS
1.1. Defined Terms. As used in this Guaranty, the following
terms shall be defined as set forth below:
"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
For the purpose of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common
control with") means the possession, directly or indirectly, of the
power to direct or cause the direction of management and policies,
either directly or indirectly, whether through the ownership of voting
securities or by contract or otherwise of any Person.
"Board" shall mean the Board of Governors of the Federal
Reserve System (or any successor).
"Capitalized Lease" shall mean any lease which is
capitalized on the books of the lessee, or should be so capitalized
under GAAP
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"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations and rulings issued
thereunder.
"Commonly Controlled Entity" shall mean an entity, whether
or not incorporated, which is under common control with the Company
within the meaning of Section 414(b) or (c) of the Code.
"Default" shall mean any of the events specified in Section
10 of this Guaranty, whether or not any requirement for the giving of
notice, the lapse of time, or both, or any other condition has been
satisfied.
"Dollars" and "$" shall mean dollars in lawful currency of
the United States of America.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as the same may, from time to time, be supplemented or
amended.
"ERISA Affiliate" means any Person which for purposes of
Title IV of ERISA is a member of the Company controlled group, or under
common control with the Company, within the meaning of Section 414 of
the Code.
"ERISA Event" means (i) a reportable event, within the
meaning of Section 4043 of ERISA, unless the 30-day notice requirement
with respect thereto has been waived by the PBGC or any successor
thereto; (ii) the provision by the administrator of any Plan of a notice
of intent to terminate such Plan, pursuant to Section 4041(a) (2) of
ERISA (including any such notice with respect to a plan amendment
referred to in Section 4041(e) of ERISA); (iii) the cessation of
operations at a facility in the circumstances described in Section 4068
(f) of ERISA; (iv) the withdrawal by the Company or an ERISA Affiliate
from a Multiemployer Plan during a plan year for which it was a
substantial employer, as defined in Section 4001(a) (2) of ERISA; (v)
the failure by the Company or any ERISA Affiliate to make a payment to a
Plan required under Section 302(f) (1) of ERISA, which Section imposes a
lien for failure to make required payments; (vi) the adoption of an
amendment to a Plan requiring the provision of security to such Plan,
pursuant to Section 307 of ERISA; or (vii) the institution by the PBGC
or any successor thereto of proceedings to terminate a Plan, pursuant to
Section 4042 of ERISA, or the occurrence of any event or condition which
might reasonably constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, a Plan.
"ESOP Note" shall mean the promissory note of the Trust
payable to the order of the Bank in the form of Exhibit A attached to
the Loan Agreement
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"Event of Default" shall mean any of the events specified in
Section 10 of this Guaranty, provided that any requirement for the
giving of notice, the lapse of time, or both, or any other condition,
has been satisfied.
"GAAP" shall mean generally accepted accounting principles
in the United States of America in effect from time to time.
"Governmental Authority" shall mean any nation or
government, any state or other political subdivision thereof, and any
entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any
corporation or other entity owned or controlled (through stock or
capital ownership or otherwise) by any of the foregoing.
"Hazardous Materials" means any flammable materials,
explosives, radioactive materials, hazardous materials, hazardous
wastes, hazardous or toxic substances, or related or similar materials,
asbestos or any material containing asbestos, or any other substance or
material as so defined and regulated by any Federal, state or local
environmental law, ordinance, rule, or regulation, including, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended (42 U.S.C. Section 9601 et seq.), the
Hazardous Materials Transportation Act, as amended (49 U.S.C. Sections
1801, et seq.), and the Resource Conservation and Recovery Act (42
U.S.C. Sections 6901, et seq.), and the regulations adopted and
publications promulgated pursuant thereto.
"Indebtedness" means all obligations of a Person which in
accordance with GAAP should be classified upon a balance sheet of such
Person as liabilities of such Person, and in any event shall include,
without duplication, all (i) indebtedness for borrowed money, (ii)
obligations evidenced by bonds, debentures, notes or other similar
instruments, (iii) obligations to pay the deferred purchase price of
property or services, (iv) Capitalized Leases, (v) obligations
(contingent or otherwise) in respect of outstanding letters of credit,
(vi) indebtedness of the type referred to in clauses (i) through (v)
above secured by (or for which the holder of such indebtedness has an
existing right, contingent or otherwise, to be secured by) any lien or
encumbrance on, or security interest in, Property (including, without
limitation, accounts and contract rights) owned by such Person, even
through such Person has not assumed or become liable for the payment of
such indebtedness, and (vii) obligations under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a creditor against
loss in respect of, indebtedness or obligations of others of the kinds
referred to in clauses (i) through (vi) above. For the purpose of
computing the Indebtedness of any Person, there shall be excluded any
particular Indebtedness to the extent that, upon or prior to the
maturity thereof, there shall have been deposited with the proper
depositary in trust the necessary funds (or evidences of such
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Indebtedness, if permitted by the instrument creating such Indebtedness)
for the payment, redemption or satisfaction of such Indebtedness; and
thereafter such funds and evidences of Indebtedness so deposited shall
not be included in any computation of the assets of such Person.
"Insufficiency" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a) (18) of ERISA.
"Liabilities" shall mean, as to any Person, at any date, all
items which would, in conformity with GAAP, be classified as liabilities
on a consolidated balance sheet of such Person at such time.
"Loan Agreement" shall mean that certain Loan Agreement
dated as of the date hereof by and among the Bank, the Company and the
Trust as the same may be modified, supplemented, extended, renewed or
amended from time to time.
"Loan Documents" shall mean the Loan Agreement, this
Guaranty, the ESOP Note and any schedule or exhibit thereto; one of the
Loan Documents shall be referred to herein as a "Loan Document."
"Multiemployer Plan" shall mean, as to any Person, a Plan of
such Person which is a multiemployer plan as defined in Section 4001(a)
(3) of ERISA.
"Obligations" shall have the meaning given to such term in
Section 2 hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.
"Person" shall mean an individual, partnership, joint
venture, corporation, business trust, joint stock company, trust,
unincorporated organization, Governmental Authority or other entity of
whatever nature.
"Plan" shall mean as to any Person any employee pension
benefit plan as defined in Section 3 (2) of ERISA that is covered by
ERISA and in respect of which that Person or a Commonly Controlled
Entity of that Person is an "employer" as defined in Section 3 (5) of
ERISA, excluding any non-qualified deferred compensation arrangement for
individual executives of the Company or any Subsidiary.
"Property" shall mean any interest in any kind of property
or asset, whether real, personal or mixed, or tangible or intangible.
"Quarter" shall mean any period of three (3) calendar months
ending on the last day of February, May, August or November
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"Single Employer Plan" shall mean any Plan of a Person which
is not a Multiemployer Plan.
"Subsidiary" shall mean, as to any Person, any corporation
of which shares of stock having ordinary voting power (other than stock
having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more
intermediaries, or both, by such Person.
"Trustee" shall mean Xxxxxxxx & Xxxxxx Trust Company, as
trustee of the Trust, or any Person or Persons who are so designated in
accordance with the terms of the ESOP.
"WGC Credit Agreement" means that certain Revolving Credit
Agreement, dated as of March 29, 1993, among Wisconsin Gas, Citibank,
N.A., Firstar Bank Milwaukee, N.A., Xxxxxx Trust & Savings Bank, M&I
Xxxxxxxx and Xxxxxx Bank, and Citibank, N.A., as agent thereunder, as
amended from time to time.
"Wisconsin Gas" shall mean Wisconsin Gas Company, a
Wisconsin corporation.
1.2. Other Definitional Provisions.
(a) As used herein and in the Loan Documents, and any
certificate or other document made or delivered pursuant hereto,
accounting terms relating to the Company not defined in subsection 1.1
hereof, and accounting terms partly defined in subsection 1.1 hereof to
the extent not defined, shall have the respective meanings given to them
under GAAP.
(b) The words "hereof," "herein" and "hereunder," and
words of similar import when used in this Guaranty shall refer to this
Guaranty as a whole and not to any particular provision of this
Guaranty, and section, subsection, paragraph, clause, schedule and
exhibit references are to this Guaranty unless otherwise specified
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SECTION 2. GUARANTY. The Company hereby unconditionally
guarantees to the Bank and its successors and assigns (a) the punctual payment
and performance when due, at the place specified therefor or, if no place is
specified, at the Bank's principal office in Chicago, Illinois, all
indebtedness, obligations and liabilities, direct or indirect, matured or
unmatured, primary or secondary, certain or contingent, of the Trust to the
Bank now or hereafter owing or incurred pursuant to the Loan Agreement or any
other Loan Document (including, without limitation, reasonable attorneys' fees
and other costs and expenses incurred by the Bank in attempting to collect or
enforce any of the foregoing after an Event of Default) accrued in each case
to the date of payment hereunder (collectively, the "Obligations" and
individually, an "Obligation"); and (b) the performance when due in all other
respects of the Trust's obligations under, and strictly in accordance with the
terms of, the Loan Agreement and the other Loan Documents.
SECTION 3. GUARANTY ABSOLUTE. This Guaranty is an absolute,
unconditional, continuing and unlimited guaranty of the full and punctual
payment and performance of the Obligations and not of their collectibility
only and is in no way conditioned upon any requirement that the Bank first
attempt to collect any of the Obligations from the Trust or resort to any
security or other means of obtaining payment of any of the Obligations which
the Bank now has or may acquire after the date hereof, or upon any other
contingency whatsoever. The obligations of the Company hereunder are
irrevocable, absolute and unconditional, irrespective of genuineness,
validity, regularity or enforceability of the Obligations or any security
given therefor or in connection therewith or any other circumstance (except
payment to the Bank of the full amount thereof) which might otherwise
constitute a legal or equitable discharge of a surety or guarantor. Upon any
default by the Trust in the full and punctual payment and performance of the
Obligations (and after the expiration of any applicable grace period provided
in the Loan Agreement), the liabilities and obligations of the Company
hereunder shall, at the option of and upon demand by the Bank, become
forthwith due and payable to the Bank. Payments by the Company hereunder may
be required by the Bank on any number of occasions.
SECTION 4. NO IMPAIRMENT. None of the limitations set forth in
Section 7.9 of the Loan Agreement shall in any way affect, impair, diminish,
relieve or delay the performance of any obligations of the Company under this
Guaranty or, upon an Event of Default, limit or impair the right of the Bank
to accelerate the Obligations as against the Trust and the Company. The
Company agrees that the obligations of the Company hereunder shall not be
impaired, modified, changed, released or limited in any manner whatsoever by
any impairment, modification, change, release or limitation of liability of
the Trust or its estate by reason of the commencement of any case, proceeding
or other action seeking reorganization, arrangement, adjustment, liquidation,
dissolution or composition of the Trust or its property under any law relating
to bankruptcy, insolvency, reorganization, relief of debtors or seeking
appointment of a receiver, trustee, custodian or similar official for the
Trust or all or part of its Property
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SECTION 5. COMPANY'S FURTHER AGREEMENT TO PAY. The Company
further agrees, as the principal obligor and not as the guarantor only, to pay
to the Bank forthwith upon demand, in funds immediately available to the Bank
at its principal office in Chicago, Illinois, all costs and expenses
(including court costs and reasonable legal expenses) incurred or expended by
the Bank in connection with the enforcement of this Guaranty, together with
interest on amounts recoverable under this Guaranty from the time such amounts
become due until payment at a rate per annum equal to the ABN AMRO Rate (as
defined in the Loan Agreement), in effect from time to time, plus two percent
(2%), compounded daily and payable on demand.
SECTION 6. TERMINATION GUARANTY. It is the intention hereof that
the Company shall remain liable under this Guaranty until all of the
Obligations have been fully paid and performed notwithstanding any act,
omission or thing (except payment to the Bank of the full amount of all
Obligations guaranteed hereby) which might otherwise operate as a legal or
equitable discharge of the Company. Notwithstanding anything contained herein
to the contrary, if at any time all or any part of any payment of any of the
Obligations previously received by the Bank pursuant to the Loan Agreement or
otherwise must be returned by the Bank for any reason in connection with any
bankruptcy, insolvency, reorganization, liquidation, debt adjustment or other
similar proceeding involving the Trust, the Trustee or the ESOP, whether by
court order, administrative order or settlement, this Guaranty shall be
revived and reinstated and the Company shall pay the Bank the amount of the
payment returned to the Trust (or to any receiver or trustee of or for the
Trust or the property or estate of the Trust), notwithstanding any termination
of this Guaranty or the cancellation of the Loan Agreement or the ESOP Note.
SECTION 7. BANK'S FREEDOM TO DEAL WITH TRUST AND OTHER PARTIES.
The Bank shall be at liberty after giving notice to the Company, and without
relieving the Company of any liability hereunder, to deal with the Trust and
with each other party who is now, or after the date hereof becomes, liable in
any manner for any of the Obligations, in such manner as the Bank in its sole
reasonable discretion deems fit and to this end the Company hereby gives to
the Bank full authority to do any or all of the following things: (a) extend
credit, make loans and afford other financial accommodations to the Trust or
to any other party at such times, in such amounts and on such terms as the
Bank may approve, (b) vary the terms and grant extensions or renewals of any
present or future indebtedness or obligation of the Trust or of any other
party to the Bank, (c) grant extensions of time, waivers and other indulgences
in respect thereof, (d) vary, exchange, release or discharge, wholly or
partially, or delay in or abstain from perfecting and enforcing any security
or guaranty or other means of obtaining payment of any of the Obligations or
any liability under this Guaranty, which security or guaranty the Bank now has
or acquires after the date hereof, (e) accept partial payments from the Trust
or other party, (f) release or discharge, wholly or partially, any endorser or
guarantor, and (g) compromise or make any settlement or other arrangement with
the Trust or any other party
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SECTION 8. REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to extend credit to the Trust and in
recognition of the fact that the Bank is acting in reliance thereupon, the
Company hereby represents and warrants to the Bank that:
8.1. Corporate Existence. The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the
State of Wisconsin. Each Subsidiary of the Company is duly incorporated,
validly existing and in good standing under the laws of the jurisdiction of
its incorporation. Each of the Company and its Subsidiaries has all requisite
corporate powers and authority to own or lease and operate its Properties and
to carry on its business as now conducted and as proposed to be conducted.
8.2. Due Authorization; No Contravention. The execution,
delivery and performance by the Company of this Agreement and the other Loan
Documents executed by it are within the Company's corporate powers, have been
duly authorized by all necessary corporate action, and do not contravene (i)
the Company's Articles of Incorporation or By-laws, (ii) any law, rule or
regulation applicable to the Company, or (iii) any contractual or legal
restriction binding on or affecting the Company, and will not result in or
require the imposition of any lien or encumbrance on, or security interest in,
any Property (including, without limitation, accounts or contract rights) of
the Company.
8.3. Governmental Approvals. No authorization or approval or
other action by, and no notice to or filing with, any governmental authority
or regulatory body, including, without limitation, the Public Service
Commission of Wisconsin, is required for the due execution, delivery and
performance by the Company of this Guaranty or any other Loan Document
executed by it.
8.4. Enforceable Obligations. This Guaranty and the other Loan
Documents executed by the Company are legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with their terms.
8.5. Financial Condition. Each of the audited, consolidated
balance sheet of the Company and its Subsidiaries as at December 31, 1995, and
the related statements of income and retained earnings of the Company and its
Subsidiaries for the fiscal year then ended, fairly present the financial
condition of the Company and its Subsidiaries as at such dates and the results
of the operations of the Company and its Subsidiaries for the periods ended on
such dates, all in accordance with GAAP consistently applied, and since
December 31, 1995, there has been no material adverse change in such condition
or operations, in the prospects of the Company and its Subsidiaries or in the
ability of the Company to perform its obligations hereunder
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8.6. No Material Litigation. There is no pending or threatened
action or proceeding affecting the Company or any of its Subsidiaries before
any court, governmental agency or arbitrator, which may materially adversely
affect the financial condition, operations or prospects of the Company or any
Subsidiary or which purports to affect the legality, validity or
enforceability of this Guaranty or any other Loan Document executed by it or
the ESOP Note.
8.7. Taxes. Each of the Company and its Subsidiaries has filed
all tax returns (Federal, State and local) required to be filed and paid all
taxes shown thereon to be due, including interest and penalties, except to the
extent the Company or any of its Subsidiaries is diligently contesting any
such taxes in good faith and by appropriate proceedings, and for which
adequate reserves for payment thereof have been established.
8.8. Subsidiaries. The Company is the direct, legal and
beneficial owner of 100% of the issued and outstanding stock of Wisconsin Gas.
8.9. Investment Company Act. None of the Company or any of its
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of
1940, as amended.
8.10. Public Utility Holding Company Act. The Company is a
"holding company" exempt from registration under Section 5 of the Public
Utility Holding Company Act of 1935, as amended, pursuant to Section 3(a) (1)
of such Act.
8.11. Margin Stock. The Company is not engaged in the business of
extending credit for the purpose of buying or carrying margin stock (within
the meaning of Regulation U issued by the Board).
8.12. ERISA. No ERISA Event has occurred or is reasonably
expected to occur with respect to any Plan which reasonably could be expected
to materially affect the financial condition, the operations or the prospects
of the Company and its Subsidiaries or in the ability of the Company to
perform its obligations hereunder. Neither the Company nor any of its ERISA
Affiliates is an employer under any Multiemployer Plan. The Company and its
Subsidiaries are in compliance in all material respects with ERISA and the
Code as they apply to any and all Plans.
8.13. Environmental Laws. The Company and its Subsidiaries are in
compliance in all material respects with all applicable Federal, state and
local statutes, rules, regulations, orders and other provisions of law
relating to Hazardous Materials, air emissions, water discharge, noise
emission and liquid disposal, and other environmental, health and safety
matters, other than those the non-compliance with which would not have a
material adverse effect (taking into consideration all fines, penalties and
sanctions that may be imposed because of such noncompliance) on the condition
(financial or otherwise) or operations or prospects of the Company or any of
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its Subsidiaries or in the ability of the Company to perform its obligations
hereunder. Neither the Company nor any of its Subsidiaries has received from
any Governmental Authority any notice of any material violation of any such
statute, rule, regulation, order or provision.
SECTION 9. COVENANTS
9.1. Affirmative Covenants. The Company covenants and agrees
that, from the date hereof and until payment in full of the Obligations, the
Company shall, unless the Bank shall otherwise consent in writing:
(a) Compliance with Laws, Etc. Comply, and cause each of
its Subsidiaries to comply, in all material respects with all applicable
laws, rules, regulations and orders, the failure to comply with which
reasonably could be expected to materially adversely affect the
financial condition, the operations or the prospects of the Company or
such Subsidiary, such compliance to include, without limitation, paying
before the same become delinquent all taxes, assessments and
governmental charges imposed upon it or upon its Property except to the
extent diligently contested in good faith and by appropriate proceedings
and for which adequate reserves for the payment thereof have been
established, and complying in all material respects with all applicable
Federal, state and local statutes, rules, regulations, orders and other
provisions of law relating to Hazardous Materials, air emissions, water
discharge, noise emission and liquid disposal, and other environmental,
health and safety matters.
(b) Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance with financially sound and reputable
insurance companies or associations in such amounts and covering such
risks as are usually carried by companies engaged in the same or similar
businesses and similarly situated.
(c) Visitation Rights. At any reasonable time and from
time to time, upon reasonable advance notice, permit the Bank or any
agents or representatives thereof (at the sole cost and expense of the
Bank), to examine and make copies of and abstracts from the records and
books of account of, and visit the properties of, the Company and any of
the Subsidiaries, and to discuss the affairs, finances and accounts of
the Company and any of the Subsidiaries with any of their officers or
directors and with their independent certified public accountants.
(d) Transactions with Affiliates. Conduct, and cause each
of its Subsidiaries to conduct, all transactions with any of their
Affiliates on terms that are fair and reasonable and no less favorable
to the Company or such Subsidiary than it would obtain in a comparable
arm's-length transaction with a Person not an Affiliate
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(e) Reporting Requirements. Furnish to the Bank:
(i) as soon as available and in any event within 45
days after the end of each of the first three quarters of each
fiscal year of the Company, a consolidated balance sheet of the
Company and its Subsidiaries as of the end of such Quarter and
consolidated statements of income and retained earnings of the
Company and its Subsidiaries for the period commencing at the end
of the previous fiscal year and ending with the end of such
Quarter, certified by the chief financial officer of the Company
as fairly presenting the financial condition of the Company and
its Subsidiaries as at such date and the results of the operations
of the Company and its Subsidiaries for the periods ended on such
date, all in accordance with GAAP consistently applied (except, as
to Wisconsin Gas, to the extent such generally accepted accounting
principles may be modified [to the extent prescribed by the Public
Service Commission of Wisconsin] by those requirements of the
Uniform System of Accounts Prescribed for Natural Gas Companies
Subject to the Provisions of the Natural Gas Act, set forth from
time to time in Part 201, Subchapter F of 18 C.F.R. Chapter 1
(1988)), together with a certificate of the chief financial
officer of the Company (A) demonstrating and certifying compliance
by the Company with the covenant set forth in Section 9.2(b) and
(B) stating that no Event of Default, or event which, with notice
or lapse of time, or both, would constitute an Event of Default,
has occurred and is continuing or, if an Event of Default or such
an event has occurred and is continuing, a statement as to the
nature thereof and the action which the Company has taken and
proposes to take with respect thereto;
(ii) as soon as available and in any event within 90
days after the end of each fiscal year of the Company, a copy of
the annual report for such year for the Company and its
Subsidiaries, containing financial statements for such year
certified without qualification by Xxxxxx Xxxxxxxx LLP or other
independent public accountants acceptable to the Bank and, to the
extent not contained in such annual report, the unconsolidated
balance sheet of the Company as of the end of such fiscal year and
the unconsolidated statements of income and retained earnings of
the Company for such fiscal year, certified by the chief financial
officer of the Company as fairly presenting the financial
condition of the Company as at such date and the results of the
operations of the Company for such fiscal year, all in accordance
with GAAP consistently applied, together with a certificate of the
chief financial officer of the Company (A) demonstrating and
certifying compliance by the Company with the covenant set forth
in Section 9.2(b) and (B) stating that no Event of Default, or
event which, with notice or lapse of time, or both, would
constitute an Event of Default, has occurred and is continuing or,
if an Event of Default or such an event has occurred and is
continuing, a statement as to the nature thereof and the action
which the Company has taken and proposes to take with respect
thereto
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(iii) as soon as possible and in any event within five
days after the occurrence of each ERISA Event, each Event of
Default and each event which, with the giving of notice or lapse
of time, or both, would constitute an Event of Default, continuing
on the date of such statement, a statement of the chief financial
officer of the Company setting forth details of such ERISA Event,
such Event of Default or such event and the action which the
Company has taken and proposes to take with respect thereto;
(iv) promptly after the sending or filing thereof,
copies of all reports which the Company sends to any of its
security holders, and copies of all reports and registration
statements which the Company or any Subsidiary files with the
Securities and Exchange Commission or any national securities
exchange; and
(v) such other information respecting the condition
or operations, financial or otherwise, of the Company or any of
its Subsidiaries as the Bank may from time to time reasonably
request.
(f) Ownership of Certain Subsidiaries. Maintain at all
times direct, 100%, legal and beneficial ownership of Wisconsin Gas.
9.2. Negative Covenants. The Company further covenants and
agrees that from the date hereof and until payment in full of the Obligations,
the Company shall not, without the written consent of the Bank (which consent
shall not be unreasonably withheld):
(a) Liens, Etc. Create or suffer to exist, or permit any of
its Subsidiaries to create or suffer to exist, any lien, security
interest or other charge or encumbrance, or any other type of
preferential arrangement, upon or with respect to any of its Properties,
whether now owned or hereafter acquired, or assign, or permit any of its
Subsidiaries to assign, any right to receive income, in each case to
secure or provide for the payment of any Indebtedness of any Person,
other than (i) purchase money liens or purchase money security interests
upon or in any Property acquired or held by the company or any
Subsidiary in the ordinary course of business to secure the purchase
price of such Property or to secure Indebtedness incurred solely for the
purpose of financing the acquisition of such Property, (ii) liens for
taxes or assessments or other governmental charges or levies not yet due
or the imposition or amount of which the Company or any Subsidiary is
diligently contesting in good faith by appropriate proceedings and for
which adequate reserves for payment thereof have been established, (iii)
pledges or deposits to secure performance in connection with bids,
tenders, contracts (other than contracts for the payment of money) or
leases to which the Company or any Subsidiary is a party, in each case
made in the ordinary course of business, (iv) materialmen's, mechanics',
carriers', workmen's, repairmen's or other similar liens arising in the
ordinary course of business, or deposits to obtain the release of such
liens, and (v) liens or security interests existing on such Property a
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the time of its acquisition (other than any such lien or security
interest created in contemplation of such acquisition).
(b) Indebtedness. Incur or create, any Indebtedness if,
immediately after giving effect to such Indebtedness and the receipt and
application of any proceeds thereof, the aggregate amount of
Indebtedness of the Company shall exceed $150,000,000.
(c) Mergers, Etc. Merge or consolidate with or into, or
sell, convey, assign, transfer, lease or otherwise dispose of (whether
in one transaction or in a series of transactions) all or substantially
all its assets (whether now owned or hereafter acquired) to, any Person,
or permit Wisconsin Gas to do so, except that any Subsidiary of the
Company may merge or consolidate with or into, or dispose of assets to,
any other Subsidiary of the Company and except that any Subsidiary of
the Company may merge into or dispose of assets to the Company, provided
in each case that, immediately after giving effect to such proposed
transaction, no Event of Default or event which, with the giving of
notice or lapse of time, or both, would constitute an Event of Default
would exist and, provided further, in each case that, immediately after
giving effect to such proposed transaction, the Company shall be in
compliance with subsection (b) above.
(d) Intercompany Loans and Investments. Except to the
extent required by the Public Service Commission of Wisconsin, make any
loan to or investment in Wisconsin Gas at any time when an Event of
Default (as defined in the WGC Credit Agreement), or any event which,
with the giving of notice or lapse of time, or both, would constitute
such an Event of Default, shall have occurred and be continuing; or make
any loan to or investment in Wisconsin Gas at any time when an Event of
Default or any event which, with the giving of notice or lapse of time
or both, would constitute an Event of Default, shall have occurred and
be continuing.
(e) Guaranties. Create, incur or suffer to exist any
obligations of the type described in clause (vii) of the definition of
Indebtedness in respect of Wisconsin Gas (other than this Guaranty).
SECTION 10. DEFAULTS
10.1. Events of Default. An Event of Default shall be deemed to
have occurred if:
(a) The Company or the Trust shall fail to pay any
principal of, premium, if any, or any interest on, the Obligations when
the same shall become due and payable, whether by acceleration or
otherwise; or
(b) Any representation or warranty made or deemed made by
the Company in this Guaranty or any certificate, document, financial
statement or other statement furnished at any time under or in
connection with the Loan Documents, proves to have been incorrect in any
material respect on or as of the date made; or
15
(c) The Company shall fail to perform or observe (i) any
term, covenant or agreement contained in Section 9.1(e) (iii), 9.1(f) or
9.2, or (ii) any other term, covenant or agreement contained in this
Guaranty (other than obligations specifically set forth elsewhere in
this Section 10.1) on its part to be performed or observed if the
failure to perform or observe such other term, covenant or agreement, if
susceptible of remedy, shall remain unremedied for 30 days after written
notice thereof shall have been given to the Company by the Bank; or
(d) The Company or Wisconsin Gas shall fail to pay any
principal of or premium or interest on any Indebtedness of the Company
or Wisconsin Gas when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to
such Indebtedness; or any other event shall occur or condition shall
exist under any agreement or instrument relating to any such
Indebtedness and shall continue after the applicable grace period, if
any, specified in such agreement or instrument, if the effect of such
event or condition is to accelerate, or to permit the acceleration of,
the maturity of such Indebtedness; or any such Indebtedness shall be
declared to be due and payable, or required to be prepared (other than
by a regularly scheduled required prepayment), prior to the stated
maturity thereof; or
(e) The Company or Wisconsin Gas shall generally not pay
its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment
for the benefit of creditors; or any proceeding shall be instituted by
or against the Company or Wisconsin Gas seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry
of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted
against it (but not instituted by it), such proceeding shall remain
undismissed or unstayed for a period of 45 days, any of the actions
sought in such proceeding (including, without limitation, the entry of
an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or for any substantial part
of its property) shall occur or the Company or Wisconsin Gas shall
consent to or acquiesce in any such proceeding; or the Company or
Wisconsin Gas shall take any corporate action to authorize any of the
actions set forth above in this subsection (e); o
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(f) Any judgment or order for the payment of money in
excess of Five Million Dollars ($5,000,000) shall be rendered against
the Company or Wisconsin Gas and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order or
(ii) there shall be any period of 10 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(g) The Company's obligations under this Guaranty shall
become unenforceable, or the Company, or any court or governmental or
regulatory body having jurisdiction over the Company, shall so assert in
writing; or
(h) Any ERISA Event shall have occurred with respect to a
Plan and, 30 days after notice thereof shall have been given to the
Company by the Bank, (i) such ERISA Event shall still exist, and (ii)
the sum (determined as of the date of occurrence of such ERISA Event) of
the Insufficiency of such Plan and the Insufficiency of any and all
other Plans with respect to which an ERISA Event shall have occurred and
then exist (or, in the case of a Plan with respect to which an ERISA
Event described in clauses (iii) through (vi) of the definition of ERISA
Event shall have occurred and then exist, the liability related thereto)
is equal to or greater than Five Million Dollars ($5,000,000); or
(i) If there shall occur any Default or Event of Default
under, or any breach or violation of, the Loan Agreement or any other
Loan Document, which Default, Event of Default, breach or violation is
not fully cured within the applicable grace period therefor, if any; or
(j) (x) Any Person or two or more Persons acting in
concert shall have acquired beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934), directly or indirectly, of securities
of the Company (or other securities convertible into such securities)
representing 50% or more of the combined voting power of all securities
of the Company entitled to vote in the election of directors, other than
securities having such power only by reason of the happening of a
contingency; or (y) during any period of up to 24 consecutive months,
commencing before or after the date of this Agreement, individuals who
at the beginning of such 24-month period were directors of the Company
shall cease for any reason to constitute a majority of the board of
directors of the Company
17
10.2. Rights Upon Default. If an Event of Default specified in
subsection 10.1(e) shall occur, all principal of and interest on the
Obligations and all amounts owing hereunder shall immediately become due and
payable, whether or not then due and payable under the Loan Agreement. If any
other Event of Default shall occur and so long as it may continue, the Bank
may (i) by notice of default to the Company, declare the Bank's obligations
under the Loan Agreement terminated forthwith, whereupon such obligations
shall terminate, and/or (ii) by notice of default to the Company, declare the
entire principal of and interest on the Obligations and all amounts owing
hereunder to be due and payable forthwith, whereupon the same shall become
immediately due and payable, whether or not then due and payable under the
Loan Agreement. Except as expressly provided above in this subsection,
presentment, demand, protest or further notice of any kind are hereby
expressly waived.
SECTION 11. MISCELLANEOUS
11.1. Waivers by the Company. The Company hereby waives: (a)
acceptance or notice of acceptance of this Guaranty by the Bank; (b) notice of
any extensions of credit in reliance hereon; (c) notice of presentment; (d)
protest and notice of dishonor or, subject to the last sentence of this
Section, of default to the Company or to any other party with respect to the
payment or performance of the Obligations hereby guaranteed; (e) any and all
other notices whatsoever to which the Company might otherwise be entitled; (f)
any requirement that the Bank be diligent or prompt in making demands
hereunder, giving notice of any default by the Trust, filing any claims with a
court in the event of receivership or bankruptcy of the Trust or asserting any
other right of the Bank hereunder; and (g) any and all other legal or
equitable defenses whatsoever to which the Company might otherwise be entitled
as a guarantor or surety.
11.2. No Contest with Bank. So long as any Obligation remains
unpaid or undischarged, the Company will not, by paying any sum recoverable
hereunder (whether or not demanded by the Bank) or by any means or on any
other ground, claim any right of subrogation with respect to any of the
Obligations guaranteed hereby or to any collateral now or hereafter granted to
secure the Obligations or, claim any setoff or counterclaim against the Trust
in respect of any liability of the Company to the Trust or of the Trust to the
Company, or, in proceedings under the United States Bankruptcy Code or
insolvency proceedings of any nature, proceed in competition with the Bank in
respect of payment hereunder or be entitled to have the benefit of any
counterclaim or proof of claim or dividend or payment by or on behalf of the
Trust or the benefit or any other security for any Obligation which, now or
hereafter, the Bank may hold or in which it may have any share
18
11.3. Remedies Cumulative. Each right, privilege, power and
remedy of the Bank under this Guaranty, the Loan Agreement, any promissory
note or other agreement or instrument signed by the Trust or the Company,
under any other instrument of any other party securing or guarantying any of
the Obligations or under applicable laws shall be cumulative and concurrent
and the exercise of any one or more of them shall not preclude the
simultaneous or later exercise by the Bank of any or all such other rights,
privileges, powers and remedies.
11.4. Notices. Unless otherwise specified, all notices, requests
and demands to or upon the respective parties hereto shall be deemed to be
effective only if in writing or if given by telecopy or telex and, unless
otherwise expressly provided herein, shall be deemed to have been duly given
or made, in the case of a delivered notice, when delivered by hand, or, in the
case of a mailed notice, five (5) days after deposited in the mail, air
postage prepaid, or, in the case of telex notice, when sent, answer back
received, or, in the case of telecopy notice, when telecopied, addressed as
follows or to such other address as may be hereafter specified by the
respective parties hereto and any future holders of the ESOP Note:
The Company: WICOR, Inc.
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Telecopy No.: (000) 000-0000
The Bank: With Respect to reports, notices of default, and other
credit matters
Name: Xxxx Xxxxx/Xxxxx XxXxxxxx
Address: ABN AMRO Bank N.V.
000 X. XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000-0000
Telex No.: 6732700
Answerback: ABN AMRO CGO
Telephone No. (000) 000-0000/2131
Fax No.: (000) 000-0000
With respect to interest rate selections and other loan administration
Name: Loan Administration
Address: ABN AMRO Bank N.V.
000 X. XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000-0000
Telex No.: 6732700
Answerback: ABN AMRO CGO
Telephone No.:(000) 000-0000
Fax No.: (312) 606-843
19
11.5. Survival of Representations and Warranties. All
representations and warranties made hereunder and in any of the Loan
Documents, or any certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Guaranty
and the ESOP Note.
11.6. Indemnification. The Company shall (a) cause Wisconsin Gas
to pay or reimburse the Bank for all of its reasonable out-of-pocket costs and
expenses incurred in connection with the negotiation, consideration,
development, preparation and/or execution of, and any amendment, supplement or
modification to, this Guaranty and the Loan Documents or any other documents
prepared in connection herewith or therewith (whether or not any such
amendment, supplement, or modification is effected or consummated), and the
consummation of the transactions contemplated hereby and thereby, including,
without limitation, the fees and disbursements of counsel to the Bank, (b) pay
or reimburse the Bank for all of its reasonable costs and expenses including,
but not limited to, litigation costs or costs incident to any proceeding
relating to the Company pursuant to 11 U.S.C. ' 101 et seq. incurred in
connection with the enforcement or preservation of any rights or questions
arising under or interpretations of this Guaranty or the Loan Documents or any
such other documents, including, without limitation, fees and disbursements of
counsel, legal assistants or paralegals to the Bank, and (c) pay, indemnify,
and hold the Bank harmless from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes, if any, which may be payable or determined to
be payable in connection with the execution and delivery of or consummation of
any of the transactions contemplated by, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of this Guaranty
or the Loan Documents or any such other documents. The obligations in this
subsection shall survive repayment of the ESOP Note and all other amounts
payable hereunder. In addition, the Company agrees to indemnify the Bank
against, and hold the Bank harmless from, any loss, cost, charge, expense
(including attorney's fees), claims, demands, suits, damages, penalties,
taxes, fines, levies and assessments which may be asserted or imposed against,
or suffered or incurred by, the Bank as a result of any representation or
warranty of the Trust in the Loan Agreement or in any other Loan Document, or
of the Company herein or in any other Loan Document, being untrue or
inaccurate in any respect or as direct or indirect result of the failure by
the Trust or the Company to observe, perform or comply with any of its
respective covenants, undertakings or obligations set forth in the Loan
Agreement or this Guaranty or in any other Loan Document.
11.7. Successors and Assigns. This Guaranty shall be binding upon
and inure to the benefit of the Company, the Bank, all future holders of the
ESOP Note and their respective successors and assigns, except that the Company
may not assign or transfer any of its rights or obligations under this
Guaranty without the prior written consent of the Bank
20
11.8. Governing Law and Submission to Jurisdiction. This Guaranty
shall be governed by, and construed and interpreted in accordance with the
laws of Illinois. Venue for the settlement of disputes under this Guaranty
shall be in the Courts of the State of Illinois or in the United States
District Court for the Northern District of Illinois, each in Xxxx County,
Illinois. The Company consents to the exercise of jurisdiction by these
courts and the vesting of venue therein.
11.9. Setoff. In addition to any rights or remedies provided by
law, or any other rights or remedies provided for in this Guaranty or the Loan
Documents, upon the occurrence of any Event of Default, the Bank is hereby
irrevocably authorized, at any time and from time to time without prior notice
to the Company, any such notice being expressly waived by the Company, to set
off, appropriate and apply any and all deposits (general or special, time or
demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect or contingent or matured or unmatured, at any time held or owing by
the Bank to or for the credit or the account of the Company, or any part
thereof, in such amounts as the Bank may elect, against and on account of the
Obligations whether or not the Bank has made any demand for payment and
although such Obligations may be contingent or unmatured. The Bank shall give
the Company prompt notice after the exercise of any such right.
11.10. Severability. Any provision of this Guaranty which is
prohibited or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof.
11.11. Headings. Section, subsection and paragraph headings
in this Guaranty are included herein for convenience of reference only and
shall not constitute a part of this Guaranty for any other purpose.
11.12. Information Respecting Trust. The Company shall be
responsible for obtaining information regarding the Trust, including, but not
limited to, any changes in the business or financial condition of the Trust
and the Bank shall have no duty to notify the Company of any such information.
IN WITNESS WHEREOF, the Company has executed this Guaranty as of
the date first above written.
WICOR, INC.
[Corporate Seal] By:
Title:
Attest:
(Title)
