VSC REVOLVER GUARANTY
REFERENCE IS HEREBY MADE to the Credit Agreement dated April 30,
1996, as amended June 19, 1997 (which, as the same is contemporaneously herewith
being amended and may hereafter be amended from time to time, will be called
herein the "Revolving Credit Agreement") among IVC Industries, Inc., a Delaware
corporation (the "Borrower"), the Banks party thereto, and The Chase Manhattan
Bank (National Association), as Agent. All capitalized terms used herein and not
defined shall have the respective meanings ascribed to them in the Revolving
Credit Agreement.
WHEREAS, the Revolving Credit Agreement provides for the extension
of credit by the Banks to the Borrower; and
WHEREAS, all the obligations and liabilities (whether now existing
or hereafter arising) of the Borrower to any or all of the Agent and the Banks
under the Revolving Credit Agreement or any of the other Facility Documents
(whether for principal, interest, fees, reimbursement obligations,
indemnification obligations, costs of enforcement or otherwise) will be called
herein the "Obligations"; and
WHEREAS, Vitamin Specialties Corp., a Pennsylvania corporation (the
"Guarantor") expects to obtain substantial economic benefit from the extension
of credit by the Banks to the Borrower under the Revolving Credit Agreement; and
WHEREAS, the execution and delivery of this guaranty by the
Guarantor is required in order to induce the Banks and the Agent to enter into a
certain amendment to the Revolving Credit Agreement.
NOW, THEREFORE, for valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and to induce the Banks and the
Agent to enter into the Revolving Credit Agreement, the Guarantor hereby agrees
with the Banks and the Agent as follows:
1. The Guarantor hereby absolutely and unconditionally guarantees
to the Agent and the Banks that the Borrower will promptly pay, perform and
observe all the Obligations, and that all sums stated to be payable in, or which
become payable under, the Facility Documents by the Borrower will be promptly
paid in full when due, whether at stated maturity or earlier by reason of
acceleration or otherwise, and, in the case of one or more extensions of time of
payment or performance or renewals of any Obligation, that the same will be
promptly paid or performed (as the case may be) when due according to such
extension or renewal, whether at stated maturity or earlier by reason of
acceleration or otherwise, irrespective of the validity, regularity, or
enforceability of any of the Facility Documents and irrespective of any present
or future law or order of any government (whether of right or in fact and
whether the Agent or any Bank shall have consented thereto) or of any agency
thereof purporting to reduce, amend, restructure or otherwise affect any
Obligation of the Borrower or other obligor or to vary the terms of payment;
provided, however, that the liability of the Guarantor hereunder with respect to
the Obligations shall not exceed at any time 90% of Adjusted Net Worth (as
hereinafter
defined) of the Guarantor. The term "Adjusted Net Worth" of the Guarantor means
the current Net Worth of the Guarantor, plus (as and when Net Worth increases)
any increase in such amount of Net Worth after the date hereof (without any
decrease for any reduction after the date hereof in current Net Worth as so
increased). The term "Net Worth" of the Guarantor means the amount of all assets
of the Guarantor, at a fair valuation, less the total liabilities of the
Guarantor (including contingent liabilities other than the liabilities of the
Guarantor under this guaranty) .
2. The Guarantor agrees that, as among the Guarantor, the Agent
and the Banks, the Obligations may be declared to be due and payable for
purposes of this guaranty notwithstanding any stay, injunction or other
prohibition which may prevent, delay or vitiate any such declaration as against
the Borrower and that, in the event of any such declaration (or attempted
declaration), such Obligations (whether or not due and payable by the Borrower)
shall forthwith become due and payable by the Guarantor for purposes of this
guaranty. The Guarantor further guarantees that all payments made by the
Borrower to the Agent and the Banks of any Obligation will, when made, be final
and agree that if any such payment is recovered from, or repaid by, the Agent or
any Bank in whole or in part in any bankruptcy, insolvency or similar proceeding
instituted by or against the Borrower, this guaranty shall continue to be fully
applicable to such Obligation to the same extent as though the payment so
recovered or repaid had never been originally made on such Obligation.
3. This is a guaranty of payment and not of collection only.
4. The Guarantor hereby consents that from time to time, without
notice to or further consent of the Guarantor, the payment, performance or
observance of any or all of the Obligations may be waived or the time of payment
or performance thereof extended or accelerated, or renewed in whole or in part,
or the terms of the Facility Documents or any part thereof may be changed and
any collateral therefor may be exchanged, surrendered or otherwise dealt with as
the Agent may determine, and any of the acts mentioned in the Facility Documents
may be done, all without affecting the liability of the Guarantor hereunder. The
Guarantor hereby waives presentment of any instrument, demand of payment,
protest and notice of non-payment or protest thereof or of any exchange, sale,
surrender or other handling or disposition of such collateral, and any
requirement that the Agent or any Bank exhaust any right, power or remedy or
proceed against the Borrower under the Facility Documents or against any other
person under any other guaranty of, or security for, any of the Obligations. The
Guarantor hereby further waives any defense whatsoever which might constitute a
defense available to, or discharge of, the Borrower or a guarantor. No payment
by the Guarantor pursuant to any provision hereunder shall entitle the
Guarantor, by subrogation to the rights of the Agent or any Bank or otherwise,
to any payment by the Borrower (or out of the property of the Borrower) except
after payment in full of all sums (including interest, costs and expenses) which
may be or become payable by the Borrower to the Agent and the Banks at any time
or from time to time; provided, however, if the Guarantor is an "insider" of the
Borrower, as such term is defined in Section 101 of the Federal Bankruptcy Code,
the Guarantor hereby irrevocably waives any and all rights to which it may be
entitled, by operation of law or otherwise, upon making any payment hereunder to
be subrogated to the rights of the
Agent and the Banks against the Borrower with respect to such payment or
otherwise to be reimbursed, indemnified or exonerated by the Borrower in respect
thereof.
5. This guaranty shall be a continuing guaranty, and any other
guarantor, and any other party liable upon or in respect of any Obligation
hereby guaranteed may be released without affecting the liability of the
Guarantor. The liability of the Guarantor hereunder shall be joint and several
with the liability of any other guarantor or other party upon or in respect of
the Obligations.
6. The Agent or any Bank may assign its rights and powers
hereunder, with all or any of the Obligations, and, in the event of such
assignment, the assignee hereof or of such rights and powers, shall have the
same rights and remedies as if originally named herein.
7. Notice of acceptance of this guaranty and of the incurring of
any and all of the Obligations of the Borrower pursuant to the Facility
Documents is hereby waived. This guaranty and all rights, obligations and
liabilities arising hereunder shall be governed by and construed according to
the laws of the State of New York. Unless the context otherwise requires, all
terms used herein which are defined in the Uniform Commercial Code shall have
the meanings therein stated.
8. The Guarantor represents and warrants that:
(a) The present fair saleable value of the assets of the
Guarantor after giving effect to the execution and delivery of this Guaranty and
the VSC Term Guaranty dated the date hereof exceeds the amount that will be
required to be paid on or in respect of the existing debts and other liabilities
(including contingent liabilities) of the Guarantor as they mature.
(b) The property of the Guarantor does not constitute
unreasonably small capital for the Guarantor to carry out its business as now
conducted and as proposed to be conducted including the capital needs of the
Guarantor.
(c) The Guarantor does not intend to, nor does it believe
that it will, incur debts beyond its ability to pay such debts as they mature
(taking into account the timing and amounts of cash to be received by the
Guarantor, and of amounts to be payable on or in respect of debt of the
Guarantor). The cash available to the Guarantor after taking into account all
other anticipated uses of the cash of the Guarantor, is anticipated to be
sufficient to pay all such amounts on or in respect of debt of the Guarantor
when such amounts are required to be paid.
(d) The Guarantor does not believe that final judgments
against it in actions for money damages will be rendered at a time when, or in
an amount such that, the Guarantor will be unable to satisfy any such judgments
promptly in accordance with their terms (taking into account the maximum
reasonable amount of such judgments in any such actions and the earliest
reasonable time at which such judgments might be rendered). The cash available
to the Guarantor after taking into account all other anticipated uses of the
cash of the Guarantor (including the payments on or in respect of debt referred
to in
paragraph (c) of this Section), is anticipated to be sufficient to pay all such
judgments promptly in accordance with their terms.
9. The Guarantor agrees that, in addition to (and without
limitation of) any right of setoff, banker's lien or counterclaim the Agent or
any Bank may otherwise have, each of the Agent and each Bank shall be entitled,
at its option, to setoff and apply balances (general or special, time or demand,
provisional or final) held by it for account of the Guarantor at any of its
offices in dollars or in any other currency, against any amounts owing hereunder
that are not paid when due (regardless of whether such balances are then due to
the Guarantor), in which case it shall promptly notify the Guarantor thereof;
provided however that any failure to give such notice shall not affect the
validity thereof.
10. No provision of this guaranty may be modified or waived
without the prior written consent of the Agent and the Required Banks.
11. The Guarantor hereby irrevocably submits to the
jurisdiction of any New York State or Federal court sitting in New York City and
New Jersey State court or Federal court sitting in New Jersey in any action or
proceeding arising out of or relating to this guaranty, and the Guarantor hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such New York State or New Jersey State or Federal
court. The Guarantor irrevocably consents to the service of any and all process
in any such action or proceeding by the mailing of copies of such process to the
Guarantor at its address specified on the signature page hereof. The Guarantor
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this paragraph shall affect the
rights of the Agent and the Banks to serve legal process in any other manner
permitted by law or affect the rights of the Agent and the Banks to bring any
action or proceeding against the Guarantor or any of its property in the courts
of any other jurisdiction. To the extent that the Guarantor has or hereafter may
acquire any immunity from jurisdiction of any court or from any legal process
(whether from service or notice, attachment prior to judgment, attachment in aid
of execution, execution or otherwise) with respect to itself or its property,
the Guarantor hereby irrevocably waives such immunity in respect of its
Obligations under this guaranty. The Guarantor hereby expressly waives any and
every right to a trial by jury in any action on or related to this guaranty, the
Obligations or the enforcement of either or all of the same, and does further
expressly waive any and every right to interpose any counterclaim in any such
action or proceeding.
12. The Guarantor agrees to reimburse the Agent and the
Banks on demand for all reasonable costs, expenses, and charges (including,
without limitation, reasonable attorneys' fees) incurred by the Agent or the
Banks in connection with any enforcement of this guaranty.
13. The rights, powers and remedies granted to the Agent and
the Banks herein shall be cumulative and in addition to any rights, powers and
remedies to which the Agent and the Banks may be entitled either by operation of
law or pursuant to the Facility Documents or any other document or instrument
delivered or from time to time to be delivered to the Agent or any Bank in
connection with the Facility Documents.
IN WITNESS WHEREOF, the Guarantor has caused this instrument to be
duly executed by their proper officers this 1 day of May, 1998.
WITNESS: VITAMIN SPECIALTIES CORP.
/s/ Xxxxxxxxx X. Xxxx By: /s/ I. Xxxx Xxxxxxxxxx
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Name: Name:
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Title:
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Address of Guarantor:
000 Xxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
