[Execution Copy]
AMENDED AND RESTATED FOAMEX INTERNATIONAL GUARANTY
This AMENDED AND RESTATED FOAMEX INTERNATIONAL GUARANTY (as amended,
supplemented, amended and restated or otherwise modified from time to time, this
"Guaranty"), dated as of December 23, 1997, is made by Foamex International
Inc., a Delaware corporation (the "Guarantor"), in favor of Citicorp USA, Inc.,
as Collateral Agent (together with any successor(s) thereto in such capacity,
the "Collateral Agent") for each of the Secured Parties, for the benefit of the
Secured Parties.
W I T N E S S E T H:
WHEREAS, pursuant to a Credit Agreement, dated as of June 12, 1997 (the
"Existing Credit Agreement"), among Foamex L.P., a Delaware limited partnership
("Foamex" or a "Borrower"), General Felt Industries, Inc., a Delaware
corporation (a "Borrower"; and, if together with Foamex, the "Borrowers"), Trace
Foam Company, Inc., a Delaware corporation and general partner of Foamex ("Trace
Foam"), FMXI, Inc., a Delaware corporation and managing general partner of
Foamex ("FMXI"), the Lenders, the Issuing Banks and Citicorp USA, Inc., as
Collateral Agent for the Lenders and the Issuing Banks and The Bank of Nova
Scotia, as Funding Agent for the Lenders and the Issuing Banks (together with
the Collateral Agent, the "Administrative Agents"), the Lenders and the Issuing
Banks have extended Commitments to make Credit Extensions to the Borrowers;
WHEREAS, the Existing Credit Agreement is to be amended by the First
Amendment to Credit Agreement, dated December 23, 1997 (the "First Amendment to
Credit Agreement", the Existing Credit Agreement as amended by the First
Amendment to Credit Agreement and as further amended, supplemented, amended and
restated or modified from time to time, being the "Credit Agreement"), among the
Borrowers, Trace Foam, FMXI, the Lenders, the Issuing Banks and the
Administrative Agents.
WHEREAS, as a condition precedent to the effectiveness of the First
Amendment to Credit Agreement, the Guarantor is required to execute and deliver
this Guaranty.
WHEREAS, the Guarantor has duly authorized the execution, delivery and
performance of this Guaranty; and
WHEREAS, it is in the best interests of the Guarantor to execute this
Guaranty inasmuch as the Guarantor will derive substantial direct and indirect
benefits from the Credit Extensions made from time to time to the Borrowers by
the Lenders and the Issuing Banks pursuant to the Credit Agreement;
NOW THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged, and in order to induce the Lenders and the Issuing Banks to
make Credit Extensions (including the initial Credit Extension) to the Borrowers
pursuant to the Credit Agreement, the Guarantor agrees, for the benefit of each
Secured Party, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Terms. The following terms (whether or not
underscored) when used in this Guaranty, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):
"Administrative Agents" is defined in the first recital.
"Borrower" and "Borrowers" is defined in the first recital.
"Collateral Agent" is defined in the preamble.
"Credit Agreement" is defined in the first recital.
"Credit Extensions" means the Loans and the Letters of Credit.
"First Amendment to Credit Agreement" is defined in the second recital.
"FMXI" is defined in the first recital.
"Foamex" is defined in the first recital.
"Guarantor" is defined in the preamble.
"Guaranty" is defined in the preamble.
"Obligations" means all Obligations (as defined in the Credit Agreement)
of the Borrowers and all obligations (monetary or otherwise) of each other
Obligor arising under or in connection with the Credit Agreement or any other
Loan Document.
"Process Agent" is defined in Section 3.9.1.
"Secured Parties" means, collectively, the Lenders, the Issuing Banks, the
Collateral Agent, the Funding Agent and the Administrative Agents, and any
Lender in its capacity as a counterparty to a Hedging Obligation.
"Trace Foam" is defined in the first recital.
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SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined herein
or the context otherwise requires, terms used in this Guaranty, including its
preamble and recitals, have the meanings provided in the Credit Agreement.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1. Guaranty. The Guarantor hereby absolutely, unconditionally
and irrevocably
(a) guarantees the full and punctual payment when due, whether at
stated maturity, by required prepayment, declaration, acceleration, demand
or otherwise, of all Obligations of each Borrower under the Credit
Agreement, the Notes and the other Loan Documents to which it is a party
and all Obligations by each other Obligor (other than Xxxxx Industries)
under the Loan Documents to which it is a party now or hereafter existing,
whether for principal, interest, fees, expenses or otherwise (including
all such amounts which would become due but for the operation of the
automatic stay under Section 362(a) of the United States Bankruptcy Code,
11 U.S.C. ss.362(a), and the operation of Sections 502(b) and 506(b) of
the United States Bankruptcy Code, 11 U.S.C. ss.502(b) and ss.506(b)), and
(b) indemnifies and holds harmless each Secured Party and each
holder of a Note for any and all costs and expenses (including reasonable
attorney's fees and expenses) incurred by such Secured Party or such
holder, as the case may be, in enforcing any rights under this Guaranty;
This Guaranty constitutes a guaranty of payment when due and not of collection,
and the Guarantor specifically agrees that it shall not be necessary or required
that any Secured Party or any holder of any Note exercise any right, assert any
claim or demand or enforce any remedy whatsoever against a Borrower or any other
Obligor (or any other Person) before or as a condition to the obligations of the
Guarantor hereunder.
SECTION 2.2. Acceleration of Guaranty. The Guarantor agrees that, in the
event of the dissolution or insolvency of a Borrower, any other Obligor or the
Guarantor, or the inability or failure of a Borrower, any other Obligor or the
Guarantor to pay debts as they become due, or an assignment by a Borrower, any
other Obligor or the Guarantor for the benefit of creditors, or the commencement
of any case or proceeding in respect of a Borrower, any other Obligor or the
Guarantor under any bankruptcy, insolvency or similar laws, and if such event
shall occur at a time when any of the Obligations of each Borrower and each
other Obligor may not then be due and payable, the Guarantor agrees that it will
pay to the Lenders forthwith the full amount
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which would be payable hereunder by the Guarantor if all such Obligations were
then due and payable.
SECTION 2.3. Guaranty Absolute, etc. This Guaranty shall in all respects
be a continuing, absolute, unconditional and irrevocable guaranty of payment,
and shall remain in full force and effect until all Obligations of each Borrower
and each other Obligor have been paid in full in cash, all obligations of the
Guarantor hereunder shall have been paid in full in cash, all Letters of Credit
have been terminated or expired and all Commitments shall have terminated. The
Guarantor guarantees that the Obligations of each Borrower and each other
Obligor will be paid strictly in accordance with the terms of the Credit
Agreement and each other Loan Document under which they arise, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Secured Party or any holder of
any Note with respect thereto. The liability of the Guarantor under this
Guaranty shall be absolute, unconditional and irrevocable irrespective of:
(a) any lack of validity, legality or enforceability of the Credit
Agreement, any Note or any other Loan Document;
(b) the failure of any Secured Party or any holder of any Note
(i) to assert any claim or demand or to enforce any right or
remedy against a Borrower, any other Obligor or any other Person
(including any other guarantor (including the Guarantor)) under the
provisions of the Credit Agreement, any Note, any other Loan
Document or otherwise, or
(ii) to exercise any right or remedy against any other
guarantor (including the Guarantor) of, or collateral securing, any
Obligations of a Borrower or any other Obligor;
(c) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Obligations of a Borrower or any
other Obligor, or any other extension, compromise or renewal of any
Obligation of a Borrower or any other Obligor;
(d) any reduction, limitation, impairment or termination of any
Obligations of a Borrower or any other Obligor for any reason, including
any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to (and the Guarantor hereby waives any right to or
claim of) any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise,
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unenforceability of, or any other event or occurrence affecting, any
Obligations of a Borrower, any other Obligor or otherwise;
(e) any amendment to, rescission, waiver, or other modification
of, or any consent to departure from, any of the terms of the Credit
Agreement, any Note or any other Loan Document;
(f) any addition, exchange, release, surrender or non-perfection
of any collateral, or any amendment to or waiver or release or addition
of, or consent to departure from, any other guaranty, held by any Secured
Party or any holder of any Note securing any of the Obligations of a
Borrower or any other Obligor; or
(g) any other circumstance which might otherwise constitute a
defense available to, or a legal or equitable discharge of, a Borrower,
any other Obligor, any surety or any guarantor.
SECTION 2.4. Reinstatement, etc. The Guarantor agrees that this Guaranty
shall continue to be effective or be reinstated, as the case may be, if at any
time any payment (in whole or in part) of any of the Obligations is rescinded or
must otherwise be restored by any Secured Party or any holder of any Note, upon
the insolvency, bankruptcy or reorganization of a Borrower, any other Obligor or
otherwise, all as though such payment had not been made.
SECTION 2.5. Waiver, etc. The Guarantor hereby waives promptness,
diligence, notice of acceptance and any other notice with respect to any of the
Obligations of a Borrower or any other Obligor and this Guaranty and any
requirement that the Collateral Agent, any other Secured Party or any holder of
any Note protect, secure, perfect or insure any security interest or Lien, or
any property subject thereto, or exhaust any right or take any action against a
Borrower, any other Obligor or any other Person (including any other guarantor)
or entity or any collateral securing the Obligations of a Borrower or any other
Obligor, as the case may be.
SECTION 2.6. Postponement of Subrogation, etc. The Guarantor agrees that
it will not exercise any rights which it may acquire by way of rights of
subrogation under this Guaranty, by any payment made hereunder or otherwise,
until the prior payment in full in cash of all Obligations of each Borrower and
each other Obligor, the termination or expiration of all Letters of Credit and
the termination of all Commitments. Any amount paid to the Guarantor on account
of any such subrogation rights prior to the payment in full in cash of all
Obligations of each Borrower and each other Obligor shall be held in trust for
the benefit of the Secured Parties and each holder of a Note and shall
immediately be paid to the Collateral Agent for the benefit
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of the Secured Parties and each holder of a Note and credited and applied
against the Obligations each Borrower and each other Obligor, whether matured or
unmatured, in accordance with the terms of the Credit Agreement; provided,
however, that if
(a) the Guarantor has made payment to the Secured Parties and each
holder of a Note of all or any part of the Obligations of a Borrower or
any other Obligor, and
(b) all Obligations of each Borrower and each other Obligor have
been paid in full in cash, all Letters of Credit have been terminated or
expired and all Commitments have been permanently terminated,
each Secured Party and each holder of a Note agrees that, at the Guarantor's
request, the Collateral Agent, on behalf of the Secured Parties and the holders
of the Notes, will execute and deliver to the Guarantor appropriate documents
(without recourse and without representation or warranty) necessary to evidence
the transfer by subrogation to the Guarantor of an interest in the Obligations
of each Borrower and each other Obligor resulting from such payment by the
Guarantor. In furtherance of the foregoing, for so long as any Obligations or
Commitments remain outstanding, the Guarantor shall refrain from taking any
action or commencing any proceeding against a Borrower or any other Obligor (or
its successors or assigns, whether in connection with a bankruptcy proceeding or
otherwise) to recover any amounts in the respect of payments made under this
Guaranty to any Secured Party or any holder of a Note.
SECTION 2.7. Successors, Transferees and Assigns; Transfers of Notes, etc.
This Guaranty shall:
(a) be binding upon the Guarantor, and its successors, transferees
and assigns; and
(b) inure to the benefit of and be enforceable by the Collateral
Agent and each other Secured Party.
Without limiting the generality of the foregoing clause (b), any Lender may
assign or otherwise transfer (in whole or in part) any Note or Credit Extension
held by it to any other Person or entity, and such other Person or entity shall
thereupon become vested with all rights and benefits in respect thereof granted
to such Lender under any Loan Document (including this Guaranty) or otherwise,
subject, however, to any contrary provisions in such assignment or transfer, and
to the provisions of Article XIII of the Credit Agreement.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties. The Guarantor hereby
represents and warrants unto the Collateral Agent as set forth in this Article
III acknowledging that the Collateral Agent is relying thereon without
independent inquiry.
SECTION 3.1.1. Corporate Existence; Compliance with Law. The Guarantor (i)
is a corporation duly organized, validly existing and in good standing under the
laws of the state of Delaware; (ii) has the requisite corporate power and
authority and the legal right to own, pledge, mortgage or otherwise encumber its
properties and to conduct its business as now and heretofore conducted; (iii) is
in compliance with its Constituent Documents; and (iv) is in compliance with all
material Requirements of Law.
SECTION 3.1.2. Corporate Power; Authorization. The execution and delivery
by the Guarantor of the Loan Documents and the Transaction Documents to which it
is a party and all instruments and documents to be delivered by the Guarantor
thereunder, and the performance of its obligations thereunder: (i) are within
the Guarantor's corporate power; (ii) have been duly authorized by all necessary
or proper corporate action; (iii) are not in contravention of any provision of
the Guarantor's Constituent Documents; (iv) will not violate any law or
regulation, or any order or decree of any court or Governmental Authority; (v)
will not conflict with or result in the breach or termination of, constitute a
default under (with or without the giving of notice, the lapse of time or both)
or a tortious interference with or accelerate any performance required by, any
material indenture, mortgage, deed of trust, lease, agreement or other
instrument to which the Guarantor is a party or by which the Guarantor or any of
its property is bound; (vi) will not result in the creation or imposition of any
Lien upon any of the property of the Guarantor; and (vii) do not require the
consent or approval of any Governmental Authority, or any other Person which has
not been obtained.
SECTION 3.1.3. No Adverse Condition. No action has been taken by any
competent authority which restrains, prevents or imposes material adverse
conditions upon, or seeks to restrain, prevent or impose material adverse
conditions upon, the consummation of any of the transactions contemplated by the
Loan Documents or the Transaction Documents.
SECTION 3.1.4. Enforceability. The obligations of the Guarantor under this
Guaranty are enforceable against the Guarantor in accordance with their terms.
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ARTICLE IV
COVENANTS, ETC.
SECTION 4.1. Covenants. The Guarantor covenants and agrees that the
Guarantor will perform the obligations set forth in this Article IV until all
Obligations of each Borrower and each other Obligor have been paid in full in
cash, all obligations of the Guarantor hereunder shall have been paid in full in
cash, all Letters of Credit have been terminated or expired and all Commitments
shall have terminated. The Guarantor shall comply with the following covenants
unless the Requisite Lenders shall otherwise give their prior written consent
thereto.
SECTION 4.1.1. Sale of Assets; Liens. The Guarantor shall not (A) sell,
assign, transfer, lease, convey or otherwise dispose of any Property, whether
now owned or hereafter acquired, or any income or profits therefrom, or enter
into any agreement to do so, except (i) as contemplated in the Foamex
International Supply Agreement, (ii) sales of assets for Fair Market Value,
(iii) that certain Canadair Challenger Model CL600-2B16, or any replacement
thereof (the "Aircraft"), which Aircraft is currently leased to the Guarantor
pursuant to that certain Aircraft Lease and Operating Agreement, dated August
17, 1995, by and between Foamex Aviation, Inc. and Jet Solutions LLC, the
proceeds of which shall be retained by the Guarantor and (iv) in connection with
the Contribution and the transactions contemplated by the Xxxxx Transaction
Documents or (B) directly or indirectly create, incur, assume or permit to exist
any Lien on or with respect to any of its Property except (i) Liens securing the
Obligations, (ii) Liens permitted by the Credit Agreement and (iii) Liens
securing the Aircraft.
SECTION 4.1.2. Conduct of Business. The Guarantor shall not engage in any
business other than acting as a holding company and holding the Investments of
the Guarantor permitted under Section 4.1.6 hereto.
SECTION 4.1.3. Transactions with Affiliates. Except in respect of
transactions (i) described in the New Foamex Subordinated Debenture Offering
Memorandum under the heading "Certain Relationships and Related Transactions" or
Schedule 6.01-Z of the Credit Agreement and (ii) contemplated by the Xxxxx
Transaction Documents, the Guarantor shall not directly or indirectly enter into
any transactions (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service), with any holder or
holders of more than five percent (5%) of any class of Equity Interests in the
Guarantor or with any of the Guarantor's Affiliates (other than Foamex and its
Subsidiaries) on terms that are less favorable to it than terms that could be
obtained in an arm's length transaction with an unrelated party at that time.
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SECTION 4.1.4. Indebtedness. Neither the Guarantor nor any of its
Subsidiaries (other than Foamex and its Subsidiaries) shall directly or
indirectly create, incur, assume or otherwise become or remain directly or
indirectly liable with respect to, any Indebtedness, except (A) Indebtedness in
respect of the Guaranty or the Obligations, (B) Indebtedness in respect of
Transaction Costs, (C) Indebtedness in respect of guaranties of the Senior
Secured Notes, the Senior Notes, the Subordinated Debentures or the Discount
Debentures, (D) Indebtedness in respect of loans constituting Investments of
Foamex permitted under Section 9.04 of the Credit Agreement, (E) Indebtedness in
respect of loans to the Guarantor from Persons other than Foamex and its
Subsidiaries for the purposes of funding taxes and ordinary operating and
general administrative expenses of the Guarantor and funding loan commitments to
DLJ Funding, Inc. under the DLJ Loan Commitment Agreement dated as of December
14, 1993 between the Guarantor and DLJ Funding, Inc. and to Marely I s.a. under
the Marely Loan Commitment Agreement dated as of December 14, 1993 between the
Guarantor and Marely I s.a., (F) other unsecured Indebtedness of the Guarantor
in an aggregate principal amount not to exceed $50,000,000 at any time,(G)
Indebtedness of the Foamex Mexico Group and its Subsidiaries, (H) Indebtedness
of the Guarantor to The CIT Group Equipment Financing, Inc. with respect to the
Aircraft and (I) Indebtedness to The Bank of Nova Scotia arising under or as
contemplated by the Xxxxx Transaction Documents.
SECTION 4.1.5. Restriction on Fundamental Changes. The Guarantor shall not
enter into any merger or consolidation, or liquidate, wind-up or dissolve (or
suffer any liquidation or dissolution), purchase or otherwise acquire, in one
transaction or series of transactions, all or substantially all of the Equity
Interests in, or other evidence of beneficial ownership of, or the business,
property or assets of, any Person except (i) the merger of Foamex-JPS Capital
Corporation, New Partners and FJGP Inc. (the "Merger") with and into the
Guarantor and (ii) in connection with the Contribution and the transactions
contemplated by the Xxxxx Transaction Documents.
SECTION 4.1.6. Investments. The Guarantor shall not directly or indirectly
make or own any Investment, except (i) Investments in cash and Cash Equivalents,
(ii) Investments held by the Guarantor set forth on Schedule I hereto, (iii)
other Investments in existence on the date hereof in an aggregate amount not to
exceed $1 million, (iv) direct cash Investments in any Borrower or Subsidiary
Guarantor,(v) other Investments in any Fiscal Year not in excess of $25,000,000
and (vi) Investments contemplated by the Contribution and the Xxxxx Transaction
Documents.
SECTION 4.1.7. Constituent Documents. Neither the Guarantor nor any of its
Subsidiaries (other than Foamex and its Subsidiaries) shall amend, modify or
otherwise change any of the terms or provisions in any of its Constituent
Documents as in
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effect on the date hereof other than amendments or modifications deemed
immaterial by the Administrative Agents or in order to effect the Merger.
SECTION 4.1.8. Transaction Documents. Neither the Guarantor nor any of its
Subsidiaries (other than Foamex and its Subsidiaries) shall amend, supplement or
otherwise modify any of the terms or provisions in any of the Transaction
Documents to which it is a party other than amendments, supplements or
modifications deemed immaterial by the Administrative Agents.
ARTICLE V
SUBORDINATION
The Guarantor hereby agrees that any Indebtedness of the Borrowers now or
hereafter owing to the Guarantor (the "Guarantor Subordinated Debt") is hereby
subordinated to all of the Obligations and to all "Senior Indebtedness" as
defined in the Subordinated Debenture Indenture and the New Foamex Subordinated
Indenture, as the case may be, in each case whether heretofore, now or hereafter
created, on the terms set forth in Article 10 of the Subordinated Debenture
Indenture to the same extent as if such Indebtedness constituted Indebtedness
evidenced by the Subordinated Debentures and the New Foamex Subordinated
Indenture, as the case may be, and to the extent necessary to comply with
Section 4.15 of the Subordinated Debenture Indenture and the New Foamex
Subordinated Indenture, as the case may be, the terms of which section are
incorporated herein by reference. In addition, the Guarantor Subordinated Debt
is subordinated on the following terms: The Guarantor Subordinated Debt shall
not be paid in whole or in part except as otherwise permitted under the terms of
the Credit Agreement. The Guarantor will not accept any payment of or on account
of any Guarantor Subordinated Debt at any time in contravention of the
foregoing. The Guarantor agrees to file all claims against the Borrowers in any
bankruptcy or other proceeding in which the filing of claims is required by law
in respect of any Guarantor Subordinated Debt, and the Collateral Agent shall be
entitled to all of the Guarantor's rights thereunder. If for any reason the
Guarantor fails to file such claim at least thirty (30) days prior to the last
date on which such claim should be filed, the Collateral Agent, as the
Guarantor's attorney-in-fact, is hereby authorized to do so in the Guarantor's
name or, in the Collateral Agent's discretion, to assign such claim to and cause
proof of claim to be filed in the name of the Collateral Agent or its nominee.
In all such cases, whether in administration, bankruptcy or otherwise, the
person or persons authorized to pay such claim shall pay to the Collateral Agent
the full amount payable on the claim in the proceeding, and, to the full extent
necessary for that purpose, the Guarantor hereby assigns to the Collateral Agent
all the Guarantor's rights to any payments or distributions to which the
Guarantor otherwise would be entitled. If the amount so paid is greater than the
Guarantor's liability hereunder, the Collateral Agent will pay
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the excess amount to the party entitled thereto. In addition, the Guarantor
hereby appoints the Collateral Agent as its attorney-in-fact to exercise all of
the Guarantor's voting rights with respect to the Guarantor Subordinated Debt in
connection with any bankruptcy proceeding or any plan for the reorganization of
the Borrowers.
ARTICLE VI
MISCELLANEOUS PROVISIONS
SECTION 6.1. Loan Document. This Guaranty is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including Article XIII thereof.
SECTION 6.2. Binding on Successors, Transferees and Assigns; Assignment.
In addition to, and not in limitation of, Section 2.7, this Guaranty shall be
binding upon the Guarantor and the Guarantor's successors, transferees and
assigns and shall inure to the benefit of and be enforceable by each Secured
Party and each holder of a Note and their respective successors, transferees and
assigns (to the full extent provided pursuant to Section 2.7); provided,
however, that the Guarantor may not assign any of its obligations hereunder
without the prior written consent of all Lenders.
SECTION 6.3. Amendments, etc. No amendment to or waiver of any provision
of this Guaranty, nor consent to any departure by the Guarantor herefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Collateral Agent (on behalf of the Lenders or the Requisite Lenders, as the case
may be) and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
SECTION 6.4. Notices. All notices and other communications provided for
hereunder shall be in writing and may be personally served, telecopied, telexed
or sent by courier service or United States certified mail and shall be deemed
to have been given when delivered in person or by courier service, upon receipt
of a telecopy or telex or four (4) Business Days after deposit in the United
States mail with postage prepaid and properly addressed. For the purposes
hereof, the address of the Guarantor shall be the address specified on the
signature page hereof, or at such other address as may be designated by the
Guarantor in a written notice to the Collateral Agent.
SECTION 6.5. No Waiver; Remedies. In addition to, and not in limitation
of, Section 2.3 and Section 2.5, no failure on the part of any Secured Party or
any holder of a Note to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any
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right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 6.6. Captions. Section captions used in this Guaranty are for
convenience of reference only, and shall not affect the construction of this
Guaranty.
SECTION 6.7. Setoff. In addition to, and not in limitation of, any rights
of any Secured Party or any holder of a Note under applicable law, each Secured
Party and each such holder shall, upon the occurrence of any Default described
in any Section 11.01(f) or 11.01(g) of the Credit Agreement or with the consent
of the Requisite Lenders, any Event of Default, have the right to appropriate
and apply to the payment of the obligations of the Guarantor owing to it
hereunder, whether or not then due, and the Guarantor hereby grants to each
Secured Party and each such holder a continuing security interest in, any and
all balances, credits, deposits, accounts or moneys of the Guarantor then or
thereafter maintained with such Secured Party, or such holder or any agent or
bailee for such Secured Party or such holder; provided, however, that any such
appropriation and application shall be subject to the provisions of Section
13.06 of the Credit Agreement.
SECTION 6.8. Severability. Wherever possible each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.
SECTION 6.9. Senior Indebtedness. The parties hereto acknowledge that the
obligations owing under this Agreement constitute "Obligations" owing under the
"Credit Agreement" and "Parent Guarantor Senior Indebtedness" (as each term is
defined in the Subordinated Debenture Indenture).
SECTION 6.10. Certain Consents and Waivers of the Guarantor.
SECTION 6.10.1. Personal Jurisdiction. (i) THE GUARANTOR IRREVOCABLY AND
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE
JURISDICTION OF ANY NEW YORK STATE COURT OR FEDERAL COURT SITTING IN NEW YORK,
NEW YORK, AND ANY COURT HAVING JURISDICTION OVER APPEALS OF MATTERS HEARD IN
SUCH COURTS, IN ANY
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ACTION OR PROCEEDING ARISING OUT OF, CONNECTED WITH, RELATED TO OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS GUARANTY,
WHETHER ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY AGREEMENT, AND THE GUARANTOR IRREVOCABLY AND UNCONDITIONALLY
AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN SUCH STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH
FEDERAL COURT. THE GUARANTOR IRREVOCABLY DESIGNATES AND APPOINTS CORPORATION
SERVICE COMPANY, 00 XXXXXXXX XXXXXX, XXX XXXX, XXX XXXX 00000, AS ITS AGENT (THE
"PROCESS AGENT") FOR SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH
COURT, SUCH SERVICE BEING ACKNOWLEDGED TO BE EFFECTIVE AND BINDING SERVICE IN
EVERY RESPECT. THE GUARANTOR AGREES THAT A FINAL JUDGMENT ACTION OR PROCEEDING
SHALL BE CONCLUSIVE AND MAY OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN
ANY OTHER MANNER PROVIDED BY LAW. THE GUARANTOR WAIVES IN ALL DISPUTES ANY
OBJECTION THAT THEY MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE.
(ii) THE GUARANTOR AGREES THAT THE COLLATERAL AGENT SHALL HAVE THE RIGHT
TO PROCEED AGAINST EACH BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION TO
ENABLE THE ADMINISTRATIVE AGENTS, THE LENDERS AND THE ISSUING BANKS TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF THE ADMINISTRATIVE AGENTS, ANY
LENDER OR ANY ISSUING BANK. EACH BORROWER WAIVES ANY OBJECTION THAT IT MAY HAVE
TO THE LOCATION OF THE COURT IN WHICH THE ADMINISTRATIVE AGENTS, ANY LENDER OR
ANY ISSUING BANK MAY COMMENCE A PROCEEDING DESCRIBED IN THIS SECTION.
SECTION 6.10.2. Service of Process. THE GUARANTOR IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION
OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE PROCESS AGENT OR THE GUARANTOR'S NOTICE ADDRESS
SPECIFIED BELOW, SUCH SERVICE TO BECOME EFFECTIVE (5) FIVE DAYS AFTER SUCH
MAILING. THE GUARANTOR IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING WITHOUT
LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT TO WHICH IT IS A PARTY IN ANY JURISDICTION SET FORTH ABOVE. NOTHING
HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR SHALL LIMIT THE RIGHT OF THE COLLATERAL AGENT TO BRING PROCEEDINGS
AGAINST THE GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION.
SECTION 6.11. Governing Law, Entire Agreement, etc. THIS GUARANTY
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF
THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). THIS GUARANTY AND THE
OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG THE PARTIES
HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY PRIOR
AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.
SECTION 6.12. Waiver of Jury Trial. THE GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS
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GUARANTY OR ANY OTHER LOAN DOCUMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE SECURED PARTIES OR SUCH
GUARANTOR. THE GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR THE LENDERS ENTERING INTO THE CREDIT AGREEMENT.
SECTION 6.13. Counterparts. This Guaranty may be executed by the parties
hereto in several counterparts, each of which shall be deemed to be an original
and all of which shall constitute together but one and the same agreement.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
Foamex International Inc.
By: /s/ Xxxxxx X. Xxxxxxxxx
-----------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Senior Vice President
Notice address:
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopier No.: 000-000-0000
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SCHEDULE I
to
Foamex International Inc. Guaranty
1,000 shares (100% of the outstanding common stock) of Foamex Delaware, Inc., a
Delaware corporation
1,000 shares (100% of the outstanding common stock) of FMXI, Inc., a Delaware
corporation
1,000 shares (100% of the outstanding common stock) of Foamex Aviation, Inc., A
Delaware corporation
1,000 shares (100% of the outstanding common stock) of JPSGP, Inc., a Delaware
corporation
1,000 shares (100% of the outstanding common stock) of Merger Acquisition Corp.,
a Delaware corporation
Investment in Trace Global Opportunities Fund, L.P. in the amount of $2,000,000
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