EXECUTION COPY
GUARANTEE AGREEMENT
GUARANTEE AGREEMENT dated as of June 24, 1997, among
INTEGRITY HOLDINGS, INC., a Delaware corporation (the
"GUARANTOR") and THE CHASE MANHATTAN BANK, a New York banking
corporation, as representative for the Secured Parties (as
defined in the Pledge Agreement dated as of June 24, 1997 among
the Borrower, the Guarantor and the Representative) (in such
capacity, the "REPRESENTATIVE").
Reference is made to the Credit Agreement dated as of June 27,
1997(as amended, supplemented or otherwise modified from time to time,
the "CREDIT AGREEMENT"), among the Borrower, the financial institutions
party thereto as lenders (the "LENDERS") and The Chase Manhattan Bank,
as administrative agent (in such capacity, the "ADMINISTRATIVE AGENT").
The Lenders have agreed to extend credit to the Borrower pursuant to,
and subject to the terms and conditions specified in, the Credit
Agreement. The Guarantor is a wholly owned Subsidiary of the Borrower
and acknowledges that it will derive substantial benefit from the making
of the Loans by the Lenders. The obligations of the Lenders to extend
credit under the Credit Agreement are conditioned upon, among other
things, the execution and delivery by the Guarantor of a guarantee
agreement in the form hereof. As consideration therefor and in order to
induce the Lenders to make Loans, the Guarantor is willing to execute
this Agreement. Terms used herein and not otherwise defined herein shall
have the meanings set forth in the Credit Agreement.
Accordingly, the parties hereto agree as follows:
SECTION 1. GUARANTEE. The Guarantor unconditionally guarantees,
as a primary obligor and not merely as a surety, (a) the due and
punctual payment by the Borrower of (i) the principal of and interest on
the Loans, when and as due, whether at maturity, by acceleration, upon
one or more dates set for prepayment or otherwise and (ii) all other
monetary obligations of the Borrower to the Secured Parties under the
Credit Agreement and the other Loan Documents to which the Borrower is
or is to be a party, (b) the due and punctual performance of all other
obligations of the Borrower under the Credit Agreement and the other Loan
Documents to which the Borrower is or is to be a party and (c) the due and
punctual payment of all obligations in respect of all Permitted Swaps that
provide, in the respective instruments creating such Permitted Swaps,
that such Permitted Swaps are to be guaranteed pursuant hereto (each
such Permitted Swap being referred to herein as a "PERMITTED SECURED
SWAP") (all the foregoing obligations referred to in the preceding
clauses (a) through (c) being collectively called the "OBLIGATIONS").
The Guarantor further agrees that the Obligations may be extended or
renewed, in whole or in part, without notice to or further assent from
it, and that it will remain bound upon its guarantee notwithstanding any
extension or renewal of any Obligation.
Anything contained in this Agreement to the contrary
notwithstanding, the obligations of the Guarantor hereunder shall be limited to
a maximum aggregate amount equal to the greatest amount that would not render
the Guarantor's obligations hereunder subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any provisions of applicable state law (collectively, the "FRAUDULENT
TRANSFER LAWS"), in each case after giving effect to all other liabilities of
the Guarantor, contingent or otherwise, that are relevant under the Fraudulent
Transfer Laws (specifically excluding, however, any liabilities of the Guarantor
(a) in respect of intercompany indebtedness to the Borrower or Affiliates of the
Borrower to the extent that such indebtedness would be discharged in an amount
equal to the amount paid by the Guarantor hereunder and (b) under any Guarantee
of senior unsecured indebtedness or Indebtedness subordinated in right of
payment to the Obligations which Guarantee contains a limitation as to maximum
amount similar to that set forth in this paragraph, pursuant to which the
liability of the Guarantor hereunder is included in the liabilities taken into
account in determining such maximum amount) and after giving effect as assets to
the value (as determined under the applicable provisions of the Fraudulent
Transfer Laws) of any rights to subrogation, contribution, reimbursement,
indemnity or similar rights of the Guarantor pursuant to (i) applicable law or
(ii) any agreement providing for an equitable allocation among the Guarantor and
other Affiliates of the Borrower of obligations arising under guarantees by such
parties.
SECTION 2. OBLIGATIONS NOT WAIVED; NO DISCHARGE OR DIMINISHMENT
OF GUARANTEE. To the fullest extent permitted by applicable law, the
Guarantor waives presentment to,
demand of payment from and protest to the Borrower of any of the
Obligations, and also waives notice of acceptance of its guarantee and
notice of protest for nonpayment. To the fullest extent permitted by
applicable law, the obligations of the Guarantor hereunder shall not be
subject to any reduction, limitation, impairment or termination for any
reason (other than the indefeasible payment in full in cash of the
Obligations), including any claim of waiver, release, surrender,
alteration or compromise of any of the Obligations, and shall not be
subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of
the Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of the Guarantor hereunder shall not be
discharged or impaired or otherwise affected by (a) the failure of the
Representative or any other Secured Party to assert any claim or demand
or to enforce or exercise any right or remedy against the Borrower under
the provisions of the Credit Agreement, any other Loan Document or any
other agreement, (b) any rescission, waiver, amendment or modification
of, or any release from any of the terms or provisions of this
Agreement, any other Loan Document, any Guarantee or any other
agreement, (c) any default, failure or delay, wilful or otherwise, in the
performance of the Obligations, (d) any other act or omission that may or
might in any manner or to any extent vary the risk of the Guarantor or
that would otherwise operate as a discharge of the Guarantor as a matter
of law or equity (other than the indefeasible payment in full in cash of
all the Obligations) or (e) the failure to perfect any security interest
in, or the release of, any of the security held by or on behalf of the
Representative or any other Secured Party.
SECTION 3. GUARANTEE OF PAYMENT. The Guarantor further agrees
that its guarantee constitutes a guarantee of payment when due and not
of collection, and waives any right to require that any resort be had by
the Representative or any other Secured Party to any of the security
held for payment of the Obligations or to any balance of any deposit
account or credit on the books of the Representative or any other
Secured Party in favor of the Borrower or any other person.
SECTION 4. DEFENSES OF BORROWER WAIVED. To the fullest extent
permitted by applicable law, the Guarantor waives any defense based on or
arising out of any defense of the Borrower or the unenforceability of the
Obligations or any part thereof from any cause, or the cessation from
any cause of the liability of the Borrower, other than the final and
indefeasible payment in full in cash of the Obligations.
SECTION 5. AGREEMENT TO PAY; SUBORDINATION. In furtherance of
the foregoing and not in limitation of any other right that the
Representative or any other Secured Party has at law or in equity
against the Guarantor by virtue hereof, upon the failure of the Borrower
or any other Loan Party to pay any Obligation when and as the same shall
become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, the Guarantor hereby promises to and will
forthwith pay, or cause to be paid, to the Representative or such other
Secured Party as designated thereby in cash the amount of such unpaid
Obligations. Upon payment by the Guarantor of any sums to the
Representative or any Secured Party as provided above, all rights of the
Guarantor against the Borrower arising as a result thereof by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise shall
in all respects be subordinate and junior in right of payment to the
prior indefeasible payment in full in cash of all the Obligations. In
addition, any indebtedness of the Borrower now or hereafter held by the
Guarantor is hereby subordinated in right of payment to the prior
payment in full of the Obligations. If any amount shall erroneously be
paid to the Guarantor on account of (i) such subrogation, contribution,
reimbursement, indemnity or similar right or (ii) any such indebtedness
of the Borrower, such amount shall be held in trust for the benefit of
the Secured Parties and shall forthwith be turned over to the Representative
in the exact form received by the Guarantor (duly endorsed by the
Guarantor to the Representative, if required) to be credited against the
payment of the Obligations, whether matured or unmatured, in accordance
with the terms of the Loan Documents.
SECTION 6. INFORMATION. The Guarantor assumes all
responsibility for being and keeping itself informed of the Borrower's
financial condition and assets, and of all other circumstances bearing
upon the risk of nonpayment of the Obligations and the nature, scope and
extent of the risks that the Guarantor assumes and incurs hereunder, and
agrees that none of the Representative or the other Secured Parties will
have any duty to advise the Guarantor of information known to it or any
of them regarding such circumstances or risks.
SECTION 7. REPRESENTATIONS AND WARRANTIES. The Guarantor
represents and warrants as to itself that all representations and
warranties relating to it contained in the Credit Agreement are true and
correct.
SECTION 8. TERMINATION. The Guarantee made hereunder (a) shall
terminate when the principal of and interest on all the Loans shall have
been indefeasibly paid in full, the Commitments shall have been
terminated and (if due and payable on the first date that the principal
of and interest on all the Loans shall have been paid in full and the
Commitments shall have been terminated) all Fees, expenses and other
amounts payable under any Loan Document shall have been paid and (b)
shall continue to be effective or be reinstated, as the case may be, if
at any time payment, or any part thereof, of any Obligation is rescinded
or must otherwise be restored by any Secured Party or the Guarantor upon
the bankruptcy or reorganization of the Borrower, the Guarantor or
otherwise.
SECTION 9. BINDING EFFECT; SEVERAL AGREEMENT; ASSIGNMENTS.
Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of
such party; and all covenants, promises and agreements by or on behalf
of the Guarantor or the Representative that are contained in this
Agreement shall bind and inure to the benefit of each party hereto and
their respective successors and assigns. This Agreement shall become
effective as to the Guarantor when a counterpart hereof executed on
behalf of the Guarantor shall have been delivered to the Representative,
and a counterpart hereof shall have been executed on behalf of the
Representative, and thereafter shall be binding upon the Guarantor and the
Representative and their respective successors and assigns, and shall inure
to the benefit of the Guarantor, the Representative and the other
Secured Parties, and their respective successors and assigns, except
that the Guarantor shall not have the right to assign its rights or
obligations hereunder or any interest herein (and any such attempted
assignment shall be void). If all of the capital stock of the Guarantor
is sold, transferred or otherwise disposed of pursuant to a transaction
permitted by Section 6.05 of the Credit Agreement, the Guarantor shall
be released from its obligations under this Agreement without further
action.
SECTION 10. WAIVERS; AMENDMENT. (a) No failure or delay of the
Representative in exercising any power or right hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and
remedies of the Representative hereunder and of the other Secured
Parties under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of this Agreement or consent to any departure by the
Guarantor therefrom shall in any event be effective unless the same shall
be permitted by paragraph (b) below, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for
which given. No notice or demand on the Guarantor in any case shall
entitle the Guarantor to any other or further notice or demand in
similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be
waived, amended or modified except pursuant to a written agreement
entered into between the Guarantor and the Representative, with the
prior written consent of the Required Lenders (except as otherwise
provided in the Credit Agreement).
SECTION 11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 12. NOTICES. All communications and notices hereunder
shall be in writing and given as provided in Section 9.01 of the Credit
Agreement. All communications and notices hereunder to the Guarantor
shall be given to it at its address set forth on Schedule I hereto, with
a copy to the Borrower.
SECTION 13. SURVIVAL OF AGREEMENT; SEVERABILITY. (a) All
covenants, agreements, representations and warranties made by the
Guarantor herein and in the certificates or other instruments prepared
or delivered in connection with or pursuant to this Agreement or any
other Loan Document shall be considered to have been relied upon by the
Representative and the other Secured Parties and, except for any
terminations, amendments or modifications thereof in accordance with the
terms hereof or thereof, shall survive the making by the Lenders of the
Loans regardless of any investigation made by the Secured Parties or on their
behalf, and, except for any termination, amendments or modifications
thereof in accordance with the terms hereof, shall continue in full
force and effect as long as the principal of or any accrued interest on
any Loan or any other fee or amount payable under this Agreement or any
other Loan Document is outstanding and unpaid and as long as the
Commitments have not been terminated.
(b) In the event any one or more of the provisions contained in
this Agreement or in any other Loan Document should be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it being
understood that the invalidity of a particular provision in a particular
jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as
close as possible to that of the invalid, illegal or unenforceable
provisions.
SECTION 14. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which
when taken together shall constitute a single contract, and shall become
effective as provided in Section 9. Delivery of an executed signature
page to this Agreement by facsimile transmission shall be as effective
as delivery of a manually executed counterpart of this Agreement.
SECTION 15. RULES OF INTERPRETATION. The rules of
interpretation specified in Section 1.02 of the Credit Agreement shall
be applicable to this Agreement.
SECTION 16. JURISDICTION; CONSENT TO SERVICE OF PROCESS. (a)
The Guarantor hereby irrevocably and unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any New York State court or
Federal court of the United States of America sitting in New York City, and
any appellate court from any thereof, in any action or proceeding arising out
of or relating to this Agreement or the other Loan Documents, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of
any such action or proceeding may be heard and determined in such New York
State or, to the extent permitted by law, in such Federal court. Each of the
parties hereto 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 Agreement
shall affect any right that the Representative or any other Secured Party may
otherwise have to bring any action or proceeding relating to this Agreement
or the other Loan Documents against the Guarantor or its properties in the
courts of any jurisdiction.
(b) The Guarantor hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any
suit, action or proceeding arising out of or relating to this Agreement or
the other Loan Documents in any New York State or Federal court. Each of the
parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 12. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 17. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 17.
SECTION 18. RIGHT OF SETOFF. If an Event of Default shall have
occurred and be continuing, each Secured Party is hereby authorized at
any time and from time to time, to the fullest extent permitted by law,
to set off and apply, in a manner consistent with Section 2.16 of the
Credit Agreement, any and all deposits (general or special, time or
demand, provisional or final) at any time held and other Indebtedness at
any time owing by such Secured Party to or for the credit or the account
of the Guarantor against any or all the obligations of the Guarantor now
or hereafter existing under this Agreement and the other Loan Documents
held by such Secured Party, irrespective of whether or not such Secured
Party shall have made any demand under this Agreement or any other Loan
Document and although such obligations may be unmatured. In the event a
Secured Party shall exercise its right of setoff pursuant to this
Section 18, such Secured Party shall promptly notify the Guarantor of such
setoff and the application of the proceeds thereof, PROVIDED that the
failure to give such notice shall not affect the validity of such setoff
and the application of the proceeds thereof. The rights of each Secured
Party under this Section 18 are in addition to other rights and remedies
(including other rights of setoff) which such Secured Party may have.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
INTEGRITY HOLDINGS, INC., as Guarantor,
by
______________________
Name:
Title: Authorized Officer
THE CHASE MANHATTAN BANK, as
Representative for the Secured
Parties,
by
_______________________
Name:
Title:
