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EXHIBIT 2
GUARANTEE
Guarantee, dated as of August 21, 1997, by and between Bucyrus
International, Inc., a Delaware corporation (the "Company") and American
Industrial Partners Capital Fund II, L.P., a Delaware limited partnership
("Guarantor").
WHEREAS, each of American Industrial Partners Acquisition Company, LLC, a
Delaware limited liability company ("Parent"), and Bucyrus Acquisition
Corporation, a Delaware corporation (the "Purchaser"), is a direct or indirect,
wholly-owned subsidiary of Guarantor; and
WHEREAS, the Company, Parent, and the Purchaser have entered into an
Agreement and Plan of Merger (the "Merger Agreement") of even date herewith; and
WHEREAS, upon the terms and subject to the conditions set forth in the
Merger Agreement, the Purchaser will make a cash tender offer (the "Offer") to
acquire all shares of the issued and outstanding common stock, $.01 par value,
of the Company (the "Shares"), for $18.00 per share net to the seller in cash;
and
WHEREAS, as an inducement to the Company to enter into the Merger
Agreement, the Guarantor has agreed to enter into this agreement;
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
Company and Guarantor hereby agree as follows:
1. Guarantor hereby unconditionally and irrevocably guarantees, as primary
obligor and not merely as surety, for the benefit of the Company the performance
of all obligations of Parent or the Purchaser pursuant to the Merger Agreement;
provided, however, that the aggregate liability to which the Guarantor may
become subject pursuant to this Guarantee or otherwise in connection with the
transactions contemplated by the Merger Agreement shall not in any event exceed
$7,000,000.
2. Guarantor covenants that this Guarantee will not be discharged except by
complete performance of the obligations contained in this Guarantee. This
Guarantee shall not be affected by, and shall remain in full force and effect
notwithstanding, any bankruptcy, insolvency, liquidation, or reorganization of
Parent or the Purchaser or Guarantor.
3. Guarantor agrees to pay, on demand, and to save the Company harmless
against liability for, any and all costs and expenses (including reasonable fees
and disbursements of counsel) incurred or expended by the Company in connection
with the enforcement of or preservation of any rights under this Guarantee.
4. Guarantor hereby represents, warrants and covenants to the Company as
follows:
a. Guarantor is a limited partnership duly organized and validly
existing under the laws of the State of Delaware. Guarantor has the
necessary power and authority to own and operate its properties and assets
and to carry on its business as currently conducted.
b. Guarantor has all requisite legal power and authority to enter into
this Guarantee. The Guarantor has all requisite legal power and authority
to carry out and perform its obligations under the terms of this Guarantee.
The Guarantee constitutes the valid and binding obligation of Guarantor,
enforceable against it in accordance with its terms, except as enforcement
may be limited by bankruptcy, insolvency, moratorium, reorganization or
other laws or equitable principles relating to or affecting creditors'
rights generally.
c. All partnership action on the part of Guarantor and its general
partner and limited partners necessary to authorize the execution, delivery
and performance of this Guarantee has been taken.
5. This Guarantee shall be deemed to be a contract under the laws of the
State of Delaware and shall for all purposes be governed by and construed in
accordance with the laws of such State.
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6. This Guarantee shall terminate and be of no further force or effect upon
the earliest of (i) the consummation of the Merger (as defined in the Merger
Agreement), (ii) October 7, 2004, or (iii) the performance of all obligations of
Parent and the Purchaser pursuant to the Merger Agreement.
IN WITNESS WHEREOF, each of the Company and Guarantor have caused this
Guarantee to be executed on its behalf by its officers thereunto duly
authorized, all as on the date first above written.
BUCYRUS INTERNATIONAL, INC.
By: /s/ X. X. XXXXXXXXXX
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X. X. Xxxxxxxxxx
President and Chief Executive
Officer
AMERICAN INDUSTRIAL PARTNERS
CAPITAL FUND II, L.P.
By: /s/ W. XXXXXXX XXXXXXX
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W. Xxxxxxx Xxxxxxx
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