SUBSIDIARY GUARANTY
This SUBSIDIARY GUARANTY, dated as of July 12, 1999, is
made by the corporations listed on the signature pages hereto, together with
each other person who may become a party hereto pursuant to SECTION 17 of
this Subsidiary Guaranty (each, a "Guarantor," and collectively, the
"Guarantors"), jointly and severally, in favor of Bank of America National
Trust and Savings Association ("Lender"), with reference to the following
facts:
RECITALS
A. Pursuant to the Business Loan Agreement of even date
herewith by and between Quidel Corporation, a Delaware corporation (the
"Borrower"), and Lender (such Business Loan Agreement, as it may hereafter be
amended, extended, renewed, supplemented, or otherwise modified from time to
time, being referred to hereinafter as the "Loan Agreement"), Lender is
providing the Borrower with certain credit facilities.
B. As a condition to the availability of such credit
facilities, the Guarantors are required to enter into this Subsidiary
Guaranty and to guaranty the Guarantied Obligations (as defined below) as
hereinafter provided.
C. The Guarantors expect to realize direct and indirect
benefits from the availability of the aforementioned credit facilities to the
Borrower, given the financial or business support which will be provided to the
Guarantors by the Borrower.
AGREEMENT
NOW, THEREFORE, in order to induce Lender to extend the
aforementioned credit facilities to the Borrower, and for other good and
valuable consideration, the receipt and adequacy of which hereby are
acknowledged, the Guarantors hereby represent, warrant, covenant, agree and
guaranty as follows:
1. DEFINITIONS. This Subsidiary Guaranty is the
Subsidiary Guaranty referred to in the Loan Agreement. Terms defined in the
Loan Agreement and not otherwise defined in this Subsidiary Guaranty shall
have the respective meanings given those terms in the Loan Agreement when
used herein and such definitions are incorporated herein as though set forth
in full. In addition, as used herein, the following terms shall have the
meanings respectively set forth after each:
"GUARANTIED OBLIGATIONS" means all obligations of the Borrower
at any time and from time to time owed to Lender under the
Loan Agreement, whether due or to become due, matured or
unmatured, liquidated or unliquidated, or contingent or
noncontingent, INCLUDING obligations of performance as well as
obligations of payment, and INCLUDING interest that accrues
after the commencement of any bankruptcy or insolvency
proceeding by or against the Borrower, any Guarantor or any
other person.
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"SUBSIDIARY GUARANTY" means this Subsidiary Guaranty, and any
extensions, modifications, renewals, restatements,
reaffirmations, supplements or amendments hereof, INCLUDING,
without limitation, any documents or agreements by which
additional Guarantors become party hereto.
2. GUARANTY OF GUARANTIED OBLIGATIONS. The Guarantors
hereby, jointly and severally, irrevocably and unconditionally guaranty and
promise to pay and perform on demand the Guarantied Obligations and each and
every one of them, INCLUDING all amendments, modifications, supplements,
renewals or extensions of any of them, whether such amendments,
modifications, supplements, renewals or extensions are evidenced by new or
additional instruments, documents or agreements or change the rate of
interest on any Guarantied Obligation or the security therefor, or otherwise.
3. NATURE OF GUARANTY. This Subsidiary Guaranty is
irrevocable and continuing in nature and relates to any Guarantied
Obligations now existing or hereafter arising. This Subsidiary Guaranty is a
guaranty of prompt and punctual payment and performance and is not merely a
guaranty of collection.
4. RELATIONSHIP TO OTHER AGREEMENTS. Nothing herein shall
in any way modify or limit the effect of terms or conditions set forth in any
other document, instrument or agreement executed by any Guarantor or in
connection with the Guarantied Obligations, but each and every term and
condition hereof shall be in addition thereto. All provisions contained in
the Loan Agreement that apply generally to all loan documents executed and
delivered in connection with the Guarantied Obligations are fully applicable
to this Subsidiary Guaranty and are incorporated herein by this reference.
5. SUBORDINATION OF INDEBTEDNESS OWED BY THE BORROWER TO
THE GUARANTORS. Each Guarantor agrees that:
(a) Any indebtedness of the Borrower now or hereafter
owed to any Guarantor hereby is subordinated to the Guarantied
Obligations.
(b) If Lender so requests, upon the occurrence and
during the continuance of any event of default under the Loan
Agreement, any such indebtedness of the Borrower now or hereafter owed
to any Guarantor shall be collected, enforced and received by such
Guarantor as trustee for Lender and shall be paid over to Lender in
kind on account of the Guarantied Obligations, but without reducing or
affecting in any manner the obligations of such Guarantor under the
other provisions of this Subsidiary Guaranty.
(c) Should such Guarantor fail to collect or enforce
any such indebtedness of the Borrower now or hereafter owed to such
Guarantor and pay the proceeds thereof to Lender in accordance with
SECTION 5(b) hereof, Lender as such Guarantor's attorney-in-fact may do
such acts and sign such documents in such Guarantor's name as Lender
considers necessary or desirable to effect such collection, enforcement
and/or payment.
6. STATUTES OF LIMITATIONS AND OTHER LAWS. Until the
Guarantied Obligations shall have been paid and performed in full, all the
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rights, privileges, powers and remedies granted to Lender hereunder shall
continue to exist and may be exercised by Lender at any time and from time to
time irrespective of the fact that any of the Guarantied Obligations may have
become barred by any statute of limitations. Each Guarantor expressly waives
the benefit of any and all statutes of limitation and of any and all laws
providing for exemption of property from execution or for evaluation and
appraisal upon foreclosure, to the maximum extent permitted by applicable
laws.
7. INCORPORATION OF SURETYSHIP PROVISIONS AND WAIVERS.
The attached EXHIBIT B, "Suretyship Provisions and Waivers", is hereby
incorporated by this reference as though set forth herein in full.
8. CONDITION OF THE BORROWER AND ITS SUBSIDIARIES. Each
Guarantor represents and warrants to Lender that such Guarantor has
established adequate means of obtaining from the Borrower, on a continuing
basis, financial and other information pertaining to the business, operations
and condition (financial and otherwise) of the Borrower and its subsidiaries
and their assets and properties, and each Guarantor now is and hereafter will
be completely familiar with the business, operations and condition (financial
and otherwise) of the Borrower and its subsidiaries and their assets and
properties. Each Guarantor hereby expressly waives and relinquishes any duty
on the part of Lender (should any such duty exist) to disclose to any
Guarantor any matter, fact or thing related to the business, operations or
condition (financial or otherwise) of the Borrower or its subsidiaries or
their assets or properties, whether now known or hereafter known by Lender
during the life of this Subsidiary Guaranty. With respect to any of the
Guarantied Obligations, Lender need not inquire into the powers of the
Borrower or any subsidiaries thereof or of the officers or employees acting
or purporting to act on the their behalf, and all Guarantied Obligations made
or created in good faith reliance upon the pro fessed exercise of such powers
shall be secured hereby.
9. LIENS ON REAL PROPERTY. In the event that all or any
part of the Guarantied Obligations at any time are secured by any one or more
deeds of trust or mortgages or other instruments creating or granting liens
on any interests in real property, each Guarantor authorizes Lender, upon the
occurrence of and during the continuance of any event of default under the
Loan Agreement, at its sole option, without notice or demand and without
affecting any Guarantied Obligations of any Guarantor, the enforceability of
this Subsidiary Guaranty, or the validity or enforceability of any liens of
Lender on any Collateral, to foreclose any or all of such deeds of trust or
mortgages or other instruments by judicial or nonjudicial sale. Each
Guarantor expressly waives any defenses to the enforcement of this Subsidiary
Guaranty or any rights of Lender created or granted hereby or to the recovery
by Lender against the Borrower, any Guarantor or any other person liable
therefor of any deficiency after a judicial or nonjudicial foreclosure or
sale, even though such a foreclosure or sale may impair the subrogation
rights of any Guarantor or may preclude any Guarantor from obtaining
reimbursement or contribution from the Borrower. Each Guarantor expressly
waives any defenses or benefits that may be derived from California Code of
Civil Procedure xx.xx. 580a, 580b, 580d or 726, or comparable provisions of
the laws of any other jurisdiction, and all other suretyship defenses it
otherwise might or would have under California Law or other applicable law.
Each Guarantor expressly waives any right to receive notice of any judicial
or nonjudicial foreclosure or sale of any real property or interest therein
subject to any such deeds of trust or mortgages or other instruments and any
Guarantor's or any other person's failure to receive any such notice shall
not impair or affect
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Guarantors' Obligations or the enforceability of this Subsidiary Guaranty or
any rights of Lender created or granted hereby.
10. WAIVER OF RIGHTS OF SUBROGATION. Notwithstanding
anything to the contrary elsewhere contained herein or in any other loan
document to which any Guarantor is a party, until no part of any commitment
to lend remains outstanding and all of the Secured Obligations have been paid
and performed in full, the Guarantors hereby expressly waive with respect to
the Borrower and its successors and assigns (INCLUDING any surety) and any
other person which is directly or indirectly a creditor of the Borrower, or
any surety for the Borrower, any and all rights at law or in equity to
subrogation, to reimbursement, to exoneration, to contribution (EXCEPT as
specifically provided in SECTION 11 below), to setoff or to any other rights
that could accrue to a surety against a principal, to a guarantor against a
maker or obligor, to an accommodation party against the party accommodated,
or to a holder or transferee against a maker, and which the Guarantors may
have or hereafter acquire against the Borrower or any other such person in
connection with or as a result of the Guarantors' execution, delivery and/or
performance of this Guaranty or any other loan document to which any
Guarantor is a party. The Guarantors agree that they shall not have or assert
any such rights against the Borrower or its successors and assigns or any
other person (INCLUDING any surety) which is directly or indirectly a
creditor of the Borrower or any surety for the Borrower, either directly or
as an attempted setoff to any action commenced against the Guarantors by the
Borrower (as borrower or in any other capacity), Lender or any other such
person. The Guarantors hereby acknowledge and agree that this waiver is
intended to benefit the Borrower and Lender and shall not limit or otherwise
affect the Guarantors' liability hereunder, under any other Loan Document to
which any Guarantor is a party, or the enforceability hereof or thereof.
11. RIGHT OF CONTRIBUTION. Each Guarantor hereby agrees
that to the extent that a Guarantor shall have paid more than its
proportionate share of all payments made hereunder, provided that the
Guarantied Obligations are then satisfied, such Guarantor shall be entitled
to seek and receive contribution from and against any other Guarantor
hereunder who has not paid its proportionate share of all such payments. The
provisions of this SECTION 11 shall in no respect limit the obligations and
liabilities of any Guarantor to Lender, and, subject to the provisions of
SECTION 18 below, each Guarantor shall remain liable to Lender for the full
amount guaranteed by such Guarantor hereunder. The "proportionate share" of
any Guarantor shall be a fraction (which shall in no event exceed 1.00) the
numerator of which is the excess, if any, of the fair value of the assets of
such Guarantor over a fair estimate of the liabilities of Guarantor and the
denominator of which is the excess (but not less than $1.00) of the fair
value of the aggregate assets (without duplication) of all the Guarantors
over a fair estimate of the aggregate liabilities (without duplication) of
all the Guarantors. All relevant calculations shall be made as of the date
such Guarantor became a Guarantor.
12. UNDERSTANDINGS WITH RESPECT TO WAIVERS AND CONSENTS.
Each Guarantor warrants and agrees that each of the waivers and consents set
forth herein is made with full knowledge of its significance and
consequences, with the understanding that events giving rise to any defense
or right waived may diminish, destroy or otherwise adversely affect rights
which Guarantor otherwise may have against the Borrower, Lender or others, or
against any Collateral, and that, under the circumstances, the waivers and
consents herein given are reasonable and not contrary to public policy or
law. Each Guarantor acknowledges that it has either consulted with legal
counsel regarding the effect of this Subsidiary Guaranty and the
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waivers and consents set forth herein, or has made an informed decision not
to do so. If this Subsidiary Guaranty or any of the waivers or consents
herein is determined to be unenforceable under or in violation of applicable
law, this Subsidiary Guaranty and such waivers and consents shall be
effective to the maximum extent permitted by law.
13. REPRESENTATIONS AND WARRANTIES. Each Guarantor hereby
makes each and every representation and warranty applicable to such Guarantor
set forth in SECTION 9 of the Loan Agreement as if set forth in full herein.
14. COSTS AND EXPENSES. Each Guarantor agrees to pay to
Lender all reasonable costs and expenses (INCLUDING, without limitation,
reasonable attorneys' fees and disbursements) incurred by Lender in the
enforcement or attempted enforcement of this Subsidiary Guaranty, whether or
not an action is filed in connection therewith, and in connection with any
waiver or amendment of any term or provision hereof. All reasonable advances,
charges, costs and expenses, INCLUDING reasonable attorneys' fees and
disbursements (including the reasonably allocated cost of legal counsel
employed by Lender), incurred or paid by Lender in exercising any right,
privilege, power or remedy conferred by this Subsidiary Guaranty, or in the
enforcement or attempted enforcement thereof, shall be subject hereto and
shall become a part of the Guarantied Obligations and shall be paid to Lender
by each Guarantor, immediately upon demand, together with interest thereon at
the rate(s) provided for under the Loan Agreement.
15. CONSTRUCTION OF THIS GUARANTY. This Subsidiary
Guaranty is intended to give rise to ABSOLUTE AND UNCONDITIONAL obligations
on the part of each Guarantor; hence, in any construction hereof,
NOTWITHSTANDING ANY PROVISION OF ANY LOAN DOCUMENT TO THE CONTRARY, this
Subsidiary Guaranty shall be construed strictly in favor of Lender in order
to accomplish its stated purpose.
16. LIABILITY. Notwithstanding anything to the contrary
elsewhere contained herein or in any other loan document to which any
Guarantor is a party, the aggregate liability of all of the Guarantors
hereunder for payment and performance of the Guarantied Obligations shall not
exceed an amount which, in the aggregate, is $1.00 less than that amount
which if so paid or performed would constitute or result in a "fraudulent
transfer", "fraudulent conveyance", or terms of similar import, under
applicable state or federal law, including without limitation, Xxxxxxx 000 xx
xxx Xxxxxx Xxxxxx Bankruptcy Code. The liability of each Guarantor hereunder
is independent of any other guaranties at any time in effect with respect to
all or any part of the Guarantied Obligations, and each Guarantor's liability
hereunder may be enforced regardless of the existence of any such guaranties.
Any termination by or release of any guarantor in whole or in part (whether
it be another Guarantor under this instrument or not) shall not affect the
continuing liability of any Guarantor hereunder, and no notice of any such
termination or release shall be required. The execution hereof by each
Guarantor is not founded upon an expectation or understanding that there will
be any other guarantor of the Guarantied Obligations.
17. JOINDER. All future acquired or established
Significant Subsidiaries of the Borrower shall become a Guarantor under and
become bound by the terms and conditions of this Subsidiary Guaranty by
executing and delivering to Lender an Instrument of Joinder substantially in
the form attached hereto as EXHIBIT A, accompanied by such documentation as
Lender may require to establish the due organization, valid existence and
good
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standing of such person, its qualification to engage in business in each
material jurisdiction in which it is required to be so qualified, its
authority to execute, deliver and perform this Subsidiary Guaranty, and the
identity, authority and capacity of each responsible official thereof
authorized to act on its behalf.
18. RELEASE OF GUARANTORS. This Subsidiary Guaranty and
all obligations of the Guarantors hereunder shall be released when all
Guarantied Obligations have been paid in full in Cash or otherwise performed
in full and when Lender has no further commitment under the Loan Agreement to
provide loans to the Borrower. Upon such release of any or all such
Guarantors' Obligations hereunder, Lender shall endorse, execute, deliver,
record and file all instruments and documents, and do all other acts and
things, reasonably required to evidence or document the release of Lender's
rights arising under this Subsidiary Guaranty, all as reasonably requested
by, and at the sole expense of, the Guarantors.
19. ARBITRATION.
(a) This Section concerns the resolution of any
controversies or claims between any Guarantor and Lender, including but
not limited to those that arise from:
(i) This Subsidiary Guaranty (including any
renewals, extensions or modifications of this Subsidiary
Guaranty);
(ii) Any document, agreement or procedure
related to or delivered in connection with this Subsidiary
Guaranty;
(iii) Any violation of this Subsidiary Guaranty;
or
(iv) Any claims for damages resulting from any
business conducted between any Guarantor and Lender, including
claims for injury to persons, property or business interests
(torts).
(b) At the request of the appropriate Guarantor or
Lender, any such controversies or claims will be settled by arbitration
in accordance with the United States Arbitration Act. The United States
Arbitration Act will apply even though this Subsidiary Guaranty
provides that it is governed by California law.
(c) Arbitration proceedings will be administered by
the American Arbitration Association and will be subject to its
commercial rules of arbitration. The arbitration will be conducted in
California within the following county or counties: Los Angeles or San
Diego.
(d) For purposes of the application of the statute of
limitations, the filing of an arbitration pursuant to this Section is
the equivalent of the filing of a lawsuit, and any claim or controversy
which may be arbitrated under this Section is subject to any applicable
statute of limitations. The arbitrators will have the authority to
decide whether any such claim or controversy is barred by the statute
of limitations and, if so, to dismiss the arbitration on that basis.
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(e) If there is a dispute as to whether an issue is
arbitrable, the arbitrators will have the authority to resolve any such
dispute.
(f) The decision that results from an arbitration
proceeding may be submitted to any authorized court of law to be
confirmed and enforced.
(g) The procedure described above will not apply if
the controversy or claim, at the time of the proposed submission to
arbitration, arises from or relates to an obligation to Lender secured
by real property located in California. In this case, both the
appropriate Guarantor and Lender must consent to submission of the
claim or controversy to arbitration. If both parties do not consent
to arbitration, the controversy or claim will be settled as follows:
(i) The appropriate Guarantor and Lender
will designate a referee (or a panel of referees) selected
under the auspices of the American Arbitration Association in
the same manner as arbitrators are selected in
Association-sponsored proceedings;
(ii) The designated referee (or the panel of
referees) will be appointed by a court as provided in
California Code of Civil Procedure Section 638 and the
following related sections;
(iii) The referee (or the presiding referee of
the panel) will be an active attorney or a retired judge; and
(iv) The award that results from the decision
of the referee (or the panel) will be entered as a judgment in
the court that appointed the referee, in accordance with the
provisions of California Code of Civil Procedure Sections 644
and 645.
(h) This provision does not limit the right of any
Guarantor or Lender to:
(i) exercise self-help remedies such as setoff;
(ii) foreclose against or sell any real
or personal property collateral; or
(iii) act in a court of law, before,
during or after the arbitration proceeding to obtain:
A. an interim remedy; and/or
B. additional or supplementary remedies.
(i) The pursuit of or a successful action for
interim, additional or supplementary remedies, or the filing of a court
action, does not constitute a waiver of the right of the appropriate
Guarantor or Lender, including the suing party, to submit the
controversy or claim to arbitration if the other party contests the
lawsuit. However, if the controversy or claim arises from or relates to
an obligation to Lender which is secured by real property located
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in California at the time of the proposed submission to arbitration,
this right is limited according to the provision above requiring the
consent of both the appropriate Guarantor and Lender to seek
resolution through arbitration.
(j) If Lender forecloses against any real property
securing this Subsidiary Guaranty, Lender has the option to exercise
the power of sale under the deed of trust or mortgage, or to proceed by
judicial foreclosure.
20. WAIVER OF JURY TRIAL. EACH GUARANTOR AND LENDER
EXPRESSLY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO
THIS SUBSIDIARY GUARANTY, THE LOAN AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY IN ANY ACTION, PROCEEDING OR
OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR PARTIES, WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER WITH
RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH GUARANTOR AND
LENDER AGREE THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS
WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER
PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY OF THIS SUBSIDIARY GUARANTY, THE LOAN AGREEMENT OR THE OTHER
LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
SUBSIDIARY GUARANTY, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS. ANY
PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH
ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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21. THIS SUBSIDIARY GUARANTY SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
CALIFORNIA.
IN WITNESS WHEREOF, each Guarantor has executed this
Subsidiary Guaranty by its duly authorized officer as of the date first
written above.
"Guarantors"
PACIFIC BIOTECH, INC.,
a California corporation
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
----------------------------------
Title: Vice President and Chief Financial Officer
---------------------------------
MBS ACQUISITION CORPORATION,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxx
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Title: Secretary and Treasurer
---------------------------------
Address for Guarantors:
c/o Quidel Corporation
00000 XxXxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xx. Xxxxxxx X. Xxxxxxx
Senior Vice President and
Chief Financial Officer
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
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EXHIBIT A
TO
SUBSIDIARY GUARANTY
INSTRUMENT OF JOINDER
THIS INSTRUMENT OF JOINDER ("Joinder") is executed as of
_________________, ____, by _____________________________________, a
___________________________ ("Joining Party"), and delivered to Bank of
America National Trust and Savings Association ("Lender") pursuant to the
Subsidiary Guaranty dated as of July 12, 1999 made by Pacific Biotech, Inc.,
a California corporation and MBS Acquisition Corporation, a Delaware
corporation (collectively, the "Guarantors"), in favor of Lender (as the same
may be amended or supplemented from time to time, the "Guaranty"). Terms used
but not defined in this Joinder shall have the meanings defined for those
terms in the Guaranty.
RECITALS
(a) The Guaranty was made by the Guarantors in favor of
Lender in connection with that certain Business Loan Agreement dated as of
July 12, 1999, by and between Quidel Corporation, a Delaware corporation (the
"Borrower"), and Lender (as the same may be amended or supplemented from time
to time, the "Loan Agreement").
(b) Joining Party has become a Significant Subsidiary of the
Borrower, and as such is required pursuant to SECTION 10.27 of the Loan
Agreement to become a Guarantor.
(c) Joining Party expects to realize direct and indirect
benefits as a result of the availability to the Borrower of the credit
facilities provided by Lender under the Loan Agreement.
NOW THEREFORE, Joining Party agrees as follows:
AGREEMENT
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(1) By this Joinder, Joining Party becomes a "Guarantor"
under and pursuant to SECTION 17 of the Guaranty. Joining Party agrees that,
upon its execution hereof, it will become a Guarantor under the Guaranty with
respect to all obligations of the Borrower to Lender heretofore or hereafter
incurred under the Loan Agreement, and will be bound by all terms,
conditions, and duties applicable to a Guarantor under the Guaranty.
(2) The effective date of this Joinder is _________, ____.
"Joining Party"
------------------------------------
a
----------------------------------
By:
---------------------------------
Title:
-----------------------------
ACKNOWLEDGED:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:
---------------------------------
Title:
------------------------------
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EXHIBIT B
TO
SUBSIDIARY GUARANTY
SURETYSHIP PROVISIONS AND WAIVERS
Each Guarantor acknowledges that the liens and security
interests created or granted under the Security Agreement will or may secure
obligations of persons other than such Guarantor and, in full recognition of
that fact, each Guarantor consents and agrees that Lender may, at any time
and from time to time, without notice or demand, and without affecting the
enforceability or security hereof:
(a) supplement, modify, amend, extend, renew, or
otherwise change the time for payment or the terms of the obligations
of the Borrower to Lender under the Loan Agreement (collectively, the
"Obligations"), or any part thereof, including any increase or decrease
of the rate(s) of interest thereon;
(b) supplement, modify, amend or waive, or enter
into or give any agreement, approval or consent with respect to, the
Obligations or any part thereof or any provision of the Loan Agreement
or any other agreement, document or instrument executed and delivered
in connection therewith (collectively with the Loan Agreement, the
"Loan Documents") or of any additional security or guaranties, or any
condition, covenant, default, remedy, right, representation or term
thereof or thereunder;
(c) accept new or additional instruments, documents
or agreements in exchange for or relative to any of the Loan Documents
or the Obligations or any part thereof;
(d) accept partial payments on the Obligations;
(e) receive and hold additional security or
guaranties for the Obligations or any part thereof;
(f) release, reconvey, terminate, waive, abandon,
subordinate, exchange, substitute, transfer and enforce any security or
guaranties, and apply any security and direct the order or manner of
sale thereof as Lender in its sole and absolute discretion may
determine;
(g) release any person or any guarantor from any
personal liability with respect to the Obligations or any part thereof;
(h) settle, release on terms satisfactory to Lender
or by operation of applicable laws or otherwise liquidate or enforce
any Obligations and any security or guaranty therefor in any manner,
consent to the transfer of any security and bid and purchase at any
sale; and
(i) consent to the merger, change or any other
restructuring or termination of the corporate existence of the Borrower
or any other person, and
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correspondingly restructure the Obligations, and any such merger,
change, restructuring or termination shall not affect the liability
of any Guarantor or the continuing existence of any liens hereunder,
under any other Loan Document to which any Guarantor is a party or
the enforceability hereof or thereof with respect to all or any part
of the Obligations.
Upon the occurrence of and during the continuance of any
event of default under the Loan Agreement, Lender may enforce this Subsidiary
Guaranty independently as to each Guarantor and independently of any other
remedy or security Lender at any time may have or hold in connection with the
Obligations, and it shall not be necessary for Lender to marshal assets in
favor of any Guarantor, the Borrower or any other person or to proceed upon
or against and/or exhaust any other security or remedy before proceeding to
enforce this Subsidiary Guaranty. Each Guarantor expressly waives any right
to require Lender to marshal assets in favor of such Guarantor, the Borrower
or any other person or to proceed against any other person or any collateral
provided by any other person, and agrees that Lender may proceed against any
person and/or collateral in such order as it shall determine in its sole and
absolute discretion. Lender may file a separate action or actions against any
Guarantor, whether action is brought or prosecuted with respect to any other
security or against any other Guarantor, the Borrower or any other person, or
whether any other person is joined in any such action or actions. Each
Guarantor agrees that Lender and the Borrower and any other person may deal
with each other in connection with the Obligations or otherwise, or alter any
contracts or agreements now or hereafter existing between any of them, in any
manner whatsoever, all without in any way altering or affecting the security
of the Security Agreement. Lender's rights hereunder shall be reinstated and
revived, and the enforceability of this Subsidiary Guaranty shall continue,
with respect to any amount at any time paid on account of the Obligations
which thereafter shall be required to be restored or returned by Lender upon
the bankruptcy, insolvency or reorganization of the Borrower, any Guarantor
or any other person, or otherwise, all as though such amount had not been
paid. The liens created or granted by the Security Agreement and the
enforceability of this Subsidiary Guaranty at all times shall remain
effective to secure the full amount of all the Obligations including, without
limitation, the amount of all loans and interest thereon at the rates
provided for in the Loan Agreement, even though the Obligations, including
any part thereof or any other security or guaranty therefor, may be or
hereafter may become invalid or otherwise unenforceable as against the
Borrower or any other person and whether or not the Borrower or any other
person shall have any personal liability with respect thereto. Each Guarantor
expressly waives any and all defenses now or hereafter arising or asserted by
reason of (a) any disability or other defense of the Borrower or any other
person with respect to the Obligations, (b) the unenforceability or
invalidity of any security or guaranty for the Obligations or the lack of
perfection or continuing perfection or failure of priority of any security
for the Obligations, (c) the cessation for any cause whatsoever of the
liability of the Borrower or any other person (other than by reason of the
full payment and performance of all Obligations), (d) any failure of Lender
to marshal assets in favor of such Guarantor or any other person, (e) except
as otherwise required by law or as provided in this Subsidiary Guaranty, any
failure of Lender to give notice of sale or other disposition of collateral
to such Guarantor or any other person or any defect in any notice that may be
given in connection with any sale or disposition of collateral, (f) except as
otherwise required by law or as provided in this Subsidiary Guaranty, any
failure of Lender to comply with applicable laws in connection with the sale
or other dis position of any collateral or other security for any Obligation,
including without limitation any failure of Lender to conduct a commercially
reasonable sale or other disposition of any collateral or other security for
any Obligation, (g) any act or omission of Lender or others that directly or
indirectly results in or aids the discharge or release of the Borrower, any
Guarantor or any other person or the Obligations or any other security or
guaranty therefor by operation of law or otherwise, (h) any law which
provides that the obligation of a surety or
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guarantor must neither be larger in amount nor in other respects more
burdensome than that of the principal or which reduces a surety's or
guarantor's obligation in proportion to the principal obligation, (i) any
failure of Lender to file or enforce a claim in any bankruptcy or other
proceeding with respect to any person, (j) the election by Lender, in any
bankruptcy proceeding of any person, of the application or non-application of
Section 1111(b)(2) of the United States Bankruptcy Code, (k) any extension of
credit or the grant of any liens under Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx
Bankruptcy Code, (l) any use of cash collateral under Section 363 of the
United States Bankruptcy Code, (m) any agreement or stipulation with respect
to the provision of adequate protection in any bankruptcy proceeding of any
person, (n) the avoidance of any liens in favor of Lender for any reason, (o)
any bankruptcy, insolvency, reorganization, arrangement, readjustment of
debt, liquidation or dissolution proceeding commenced by or against any
person, including any discharge of, or bar or stay against collecting, all or
any of the Obligations (or any interest thereon) in or as a result of any
such proceeding or (p) to the extent permitted, the benefits of any form of
one-action rule.
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