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EXHIBIT 10.23
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT dated as of February 29, 2000 (the "Guaranty")
is given by NORDSTROM, INC., a Washington corporation (the "Guarantor"), in
favor of BANK OF AMERICA, N.A., as Administrative Agent (in such capacity, the
"Administrative Agent") and the Lenders party to the Credit Agreement described
below.
W I T N E S S E T H
WHEREAS, 1700 Seventh L.P., a Washington limited partnership (the
"Borrower"), the Lenders and the Administrative Agent have entered into that
certain Credit Agreement dated as of the date hereof (as amended, modified,
restated or supplemented from time to time, the "Credit Agreement"); and
WHEREAS, this Guaranty is a condition precedent to the effectiveness of
the Credit Agreement and the obligations of the Lenders to make loans and
extensions of credit to the Borrower under the Credit Agreement.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Guarantor hereby agrees as follows:
SECTION 1
DEFINITIONS
1.1 CERTAIN DEFINITIONS.
Unless otherwise defined herein, capitalized terms used herein
(including those in the preamble and recitals) shall have the meanings ascribed
to such terms in the Credit Agreement.
"Affiliate" means, with respect to any Person, any other Person
that, directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such
first Person. The term "control" means the possession, directly or
indirectly, of the power, whether or not exercised, to direct or cause
the direction of the management or policies of a Person, whether through
the ownership of Capital Stock by contract or otherwise, and the terms
"controlled" and "common control" have correlative meanings. Unless
otherwise indicated, "Affiliate" refers to an Affiliate of the
Guarantor. Notwithstanding the foregoing, in no event shall any Lender
or any Affiliate of a Lender be deemed to be an Affiliate of the
Guarantor. For avoidance of doubt, the parties agree that the Borrower
is not an Affiliate of the Guarantor.
"Applicable Law" means all applicable provisions of all (i)
constitutions, treaties, statutes, laws, rules, regulations and
ordinances of any Governmental Authority, (ii)
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Governmental Approvals and (iii) orders, decisions, judgments, awards
and decrees of any Governmental Authority.
"Capital Stock" means, with respect to any Person, all (i)
shares, interests, participations or other equivalents (howsoever
designated) of capital stock and other equity interests of such Person
and (ii) rights (other than debt securities convertible into capital
stock or other equity interests), warrants or options to acquire any
such capital stock or other equity interests.
"Capitalized Leases" means, as to any Person, all leases of such
Person of real or personal property that are required to be capitalized
on the balance sheet of such Persons. The amount of any Capitalized
Lease shall be the capitalized amount thereof.
"Change of Control" means any Person or two or more Persons
acting in concert (other than the Controlling Stockholders) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Act of 1934),
directly or indirectly, of Voting Stock of the Guarantor (or other
Securities convertible into such Voting Stock) representing 40% or more
of the combined voting power of all Voting Stock of the Guarantor.
"Closing Date" means the date hereof.
"Contingent Obligation" means, as to any Person, any obligation,
direct or indirect, contingent or otherwise, of such Person (i) with
respect to any Debt or other obligation of another Person, including any
direct or indirect guarantee of such Debt (other than any endorsement
for collection in the ordinary course of business) or any other direct
or indirect obligation, by agreement or otherwise, to purchase or
repurchase any such Debt or obligation or any security therefor, or to
provide funds for the payment or discharge of any such Debt or
obligation (whether in the form of loans, advances, stock purchases,
capital contributions or otherwise), (ii) to provide funds to maintain
the financial condition of any other Person, or (iii) otherwise to
assure or hold harmless the holders of Debt or other obligations of
another Person against loss in respect thereof. The amount of any
Contingent Obligation under clause (i) or (ii) shall be the greater of
(a) the amount of the Debt or obligation guaranteed or otherwise
supported thereby, or (b) the maximum amount guarantied or supported by
the Contingent Obligation. The term "Contingent Obligation," as used
with respect to the Guarantor, shall not include (i) the obligations of
the Guarantor under any obligation which the Guarantor does or may have
to sell to, repurchase from or indemnify the purchaser with respect to
accounts discounted or sold by the Guarantor in the ordinary course of
its business (but any such other obligation shall be excluded only to
the extent that such other obligation is not for the benefit, directly
or indirectly, of any Person that is not a wholly owned Subsidiary
(direct or indirect) of the Guarantor) or (ii) any obligation which a
Subsidiary does or may have to sell to, repurchase from or indemnify the
purchaser with respect to accounts discounted or sold by the Subsidiary
in the ordinary course of its business (but any such other obligation
shall be excluded only to the extent that such obligation is not for the
benefit,
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directly or indirectly, of any Person that is not a wholly owned
Subsidiary (direct or indirect) of the Guarantor); or (iii) supply,
service or licensing agreements between or among Xxxxxxxxx.xxx, LLC, a
Delaware limited liability company, and its successors on the one hand,
and the Guarantor and its other Subsidiaries, on the other hand, so long
as such agreements are fair and reasonable to the Guarantor and such
other Subsidiaries under the circumstances.
"Contractual Obligation" means, as applied to any Person, any
provision of any security issued by that Person or any indenture,
agreement or other instrument to which that Person is a party or by
which it or any of the properties owned or leased by it is bound or
otherwise subject.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (irrespective of whether
incorporated) that, together with the Guarantor or any Subsidiary, are
or were treated as a single employer under Section 414 of the Code.
"Controlling Stockholders" means the individuals listed on
Schedule 1 hereto and the spouse and lineal descendents of any such
individual.
"Debt" means, with respect to any Person, the aggregate amount
of, without duplication: (i) all obligations for borrowed money; (ii)
all obligations evidenced by bonds, debentures, notes or other similar
instruments; (iii) all obligations to pay the deferred purchase price of
property or services, except trade accounts payable not overdue arising
in the ordinary course of business; (iv) all Capitalized Leases; (v) all
obligations of others secured by a Lien on any asset owned by such
Person or Persons whether or not such obligation or liability is
assumed; (vi) all obligations of such Person or Persons, contingent or
otherwise, in respect of any letters of credit or bankers' acceptances;
and (vii) all Contingent Obligations.
"Default" means any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"EBITDAR" means, for any period, net income (or net loss) plus,
to the extent deducted in determining such net income (or net loss), the
sum of (a) interest expense, (b) income tax expense, (c) depreciation
expense, (d) amortization expense and (e) rent expense, in each case
determined in accordance with GAAP for such period.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to rime.
"ERISA Event" means (i) (a) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA with respect to any Plan
unless the 30-day notice requirement with respect to such event has been
waived by the PBGC (provided that a reportable event arising from the
disqualification of a Plan or the distress termination of a
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Plan under ERISA Section 4041(c) shall be deemed to be an ERISA Event
without regard to the waiver of notice provided by the PBGC by
regulation or otherwise), or (b) the requirements of subsection (1) of
Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (ii) an application is filed with the Internal
Revenue Service for a minimum funding waiver under Section 412 of the
Internal Revenue Code with respect to a Plan; (iii) the provision by the
administrator of any Plan of a notice of intent to terminate such Plan
pursuant to Section 4041(a)(2) of ERISA (including any such notice with
respect to a plan amendment referred to in Section 4041(e) of ERISA);
(iv) the cessation of operations at a facility of the Guarantor or any
member of the Controlled Group in the circumstances described in Section
4062(e) of ERISA; (v) the withdrawal by the Guarantor or any member of
the Controlled Group from a Multiple Employer Plan during a plan year
for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA; (vi) the conditions for the imposition of a lien
under Section 302(f) of ERISA shall have been met with respect to any
Plan; (vii) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or
(viii) the institution by the PBGC of proceedings to terminate a Plan
pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA that constitutes grounds
for the termination of, or the appointment of a trustee to administer, a
Plan.
"Existing Liens" means the Liens described on Schedule 5.1.1.
"Fiscal Year" means the fiscal year of the Guarantor, which shall
be the 12 month-period ending on January 31 in each year or such other
period as the Guarantor may designate and the Agent may approve in
writing. "Fiscal Quarter" or "fiscal quarter" means any quarter of a
Fiscal Year.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to the terms of
Section 1.3.
"Governmental Approval" means an authorization, consent,
approval, permit or license issued by, or a registration or filing with,
any Governmental Authority.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Guaranteed Obligations" means, without duplication, (i) all of
the obligations of the Borrower to the Lenders, the Administrative Agent
and the Project Administrative Agent, whenever arising, under the Credit
Agreement, the Notes, the Environmental Indemnity Agreement, the
Collateral Documents or any of the other Credit Documents (including,
but not limited to, any interest accruing after the occurrence of a
Bankruptcy Event with respect to any Credit Party, regardless of whether
such interest is an allowed
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claim under the Bankruptcy Code) and (ii) all liabilities and
obligations, whenever arising, owing from the Borrower to any Lender, or
any Affiliate of a Lender, arising under any Hedging Agreement.
"Investment Agreement" means the Investment Agreement, dated as
of October 8, 1994, between the Guarantor and Nordstrom Credit, as
amended from time to time.
"Lien" means any lien, mortgage, pledge, security interest,
charge, or encumbrance of any kind (including any conditional sale or
other title retention agreement or any lease in the nature thereof) and
any agreement to give any lien, mortgage, pledge, security interest,
charge, or other encumbrance of any kind.
"Margin Regulations" means Regulations T, U and X of the Federal
Reserve Board, as amended from time to time.
"Margin Stock" means "margin stock" as defined in the Margin
Regulations.
"Material Adverse Effect" or "Material Adverse Change" means (i)
a material adverse effect on or (ii) a material adverse change in, as
the case may be, any one or more of the following: (A) the business,
assets, results of operations or financial condition of the Guarantor
and its Subsidiaries taken as a whole or (B) the ability of the
Guarantor to perform its obligations under any Credit Document to which
it is a party or (C) the actual material rights and remedies of any
Lender under any Credit Document.
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA.
"Nordstrom Credit" means Nordstrom Credit, Inc., a Colorado
corporation, and any successor.
"Xxxxxxxxx.xxx Loan Agreement" means that certain loan agreement
to be entered into between the Guarantor and Xxxxxxxxx.xxx, LLC, as
amended or modified from time to time.
"Permitted Liens" means, with respect to any asset, the Liens (if
any) permitted to exist on such asset under Section 5.1.
"Person" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated) or any Governmental Authority.
"Plan" means, at any time, any employee pension benefit plan that
is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and that is either (i)
maintained by the Guarantor or any member of a Controlled Group for
employees of the Guarantor or such Controlled Group or was formerly so
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maintained and in respect of which the Guarantor or any member of the
Controlled Group could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated or (ii) maintained for
employees of the Guarantor or any member of the Controlled Group and at
least one Person other than the Guarantor and the members of the
Controlled Group or was formerly so maintained and in respect of which
the Guarantor or any member of the Controlled Group could have liability
under Section 4064 or 4069 of ERISA in the event such plan has been or
were to be terminated.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any Capital Stock of the
Guarantor or any Subsidiary, now or hereafter outstanding except (a) a
dividend or other distribution payable solely in shares or equivalents
of Capital Stock of the same class as the Capital Stock on account of
which the dividend or distribution is being paid or made and (b) the
issuance of equity interests upon the exercise of outstanding warrants,
options or other rights, or (ii) any redemption, retirement, sinking
fund or similar payment, purchase or other acquisition for value, direct
or indirect, of any Capital Stock of the Guarantor or any Subsidiary,
now or hereafter outstanding.
"Subsidiary" means, with respect to any Person, any other Person
of which more than 50% of the total voting power of the Capital Stock
entitled to vote in the election of the board of directors (or other
Persons performing similar functions) are at the time directly or
indirectly owned by such first Person. Unless otherwise indicated,
"Subsidiary" refers to a Subsidiary of the Guarantor.
"Taxes" means any present or future income, stamp and other
taxes, charges, fees, levies, duties, imposts, withholdings or other
assessments, together with any interest and penalties, additions to tax
and additional amounts imposed by any federal, state, local or foreign
taxing authority upon any Person.
"Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies. entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even though the right to so vote has been suspended by the
happening of such a contingency.
"Wholly-Owned" means, with respect to any Subsidiary, that all
the Capital Stock (except for directors' qualifying shares) of such
Subsidiary are directly or indirectly owned by the Guarantor.
1.2 COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
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1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms used
herein shall be interpreted, and all financial statements and certificates and
reports as to financial matters required to be delivered to the Administrative
Agent or the Lenders hereunder shall be prepared, in accordance with GAAP
applied on a consistent basis. All calculations made for the purposes of
determining compliance with this Guaranty shall (except for changes concurred in
by the relevant independent public accountants) be made by application of GAAP
applied on a basis consistent with the audited financial statements of the
Guarantor referred to in Section 3.1.
SECTION 2
GUARANTY
2.1 THE GUARANTY.
The Guarantor hereby guarantees to each Lender, each Affiliate of a
Lender that enters into a Hedging Agreement, and the Administrative Agent as
hereafter provided, as primary obligor and not as surety, the prompt payment of
the Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof. The Guarantor hereby
further agrees that if any of the Guaranteed Obligations are not paid in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise), the Guarantor
will promptly pay the same, without any demand or notice whatsoever (except for
any such notice required by the Credit Agreement), and that in the case of any
extension of time of payment or renewal of any of the Guaranteed Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) in accordance with the terms of such extension
or renewal.
Notwithstanding any provision to the contrary contained herein or in any
other of the Credit Documents or Hedging Agreements, the obligations of the
Guarantor hereunder and the other Credit Documents shall be limited to an
aggregate amount equal to the largest amount that would not render such
obligations subject to avoidance under Section 548 of the Bankruptcy Code or any
comparable provisions of any applicable state law.
2.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantor under Section 2.1 are absolute and
unconditional, irrespective of the value, genuineness, validity, regularity or
enforceability of any of the Credit Documents or Hedging Agreements, or any
other agreement or instrument referred to therein, or any substitution,
compromise, release, impairment or exchange of any other guarantee of or
security for any of the Guaranteed Obligations, and, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor, it being the intent of this Section 2.2 that the
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obligations of the Guarantor hereunder shall be absolute and unconditional under
any and all circumstances. The Guarantor agrees that it shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other guarantor for amounts paid under this Section 2 until such time as the
Lenders (and any Affiliates of Lenders entering into Hedging Agreements) have
been paid in full, all Commitments under the Credit Agreement have been
terminated and no Person or Governmental Authority shall have any right to
request any return or reimbursement of funds from the Lenders in connection with
monies received under the Credit Documents or Hedging Agreements. Without
limiting the generality of the foregoing, it is agreed that, to the fullest
extent permitted by law, the occurrence of any one or more of the following
shall not alter or impair the liability of the Guarantor hereunder which shall
remain absolute and unconditional as described above:
(a) at any time or from time to time, without notice to the
Guarantor, the time for any performance of or compliance with any of the
Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(b) any of the acts mentioned in any of the provisions of any of
the Credit Documents or Hedging Agreements or any other agreement or
instrument referred to in the Credit Documents or Hedging Agreements
shall be done or omitted;
(c) (i) the maturity of any of the Guaranteed Obligations shall
be accelerated, or (ii) any of the Guaranteed Obligations shall be
modified, supplemented or amended in any respect with the consent of the
Guarantor, or (iii) any right under any of the Credit Documents or
Hedging Agreements or any other agreement or instrument referred to in
the Credit Documents or Hedging Agreements shall be waived, or (iv) any
other guarantee of any of the Guaranteed Obligations or any security
therefor shall be released, impaired or exchanged in whole or in part or
otherwise dealt with;
(d) any Lien granted to, or in favor of, the Administrative Agent
or any Lender or Lenders as security for any of the Guaranteed
Obligations shall fail to attach or be perfected; or
(e) any of the Guaranteed Obligations shall be determined to be
void or voidable (including, without limitation, for the benefit of any
creditor of the Guarantor) or shall be subordinated to the claims of any
Person (including, without limitation, any creditor of the Guarantor).
With respect to its obligations hereunder, the Guarantor hereby expressly waives
diligence, presentment, demand of payment, protest, notice of acceptance of this
Guaranty and of extensions of credit which may constitute Guaranteed
Obligations, notice of amendments, waivers or supplements to the Credit
Documents (except for any such notice required by the Credit Agreement) or
Hedging Agreements or the compromise, release or exchange of collateral or
security and all other notices whatsoever, and any requirement that the
Administrative Agent or any Lender exhaust any right, power or remedy or proceed
against any Person under any of the Credit Documents or Hedging Agreements or
any other agreement or instrument referred to in the Credit
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Documents or against any other Person under any other guarantee of, or security
for, any of the Guaranteed Obligations.
2.3 REINSTATEMENT.
Neither the Guarantor's obligations hereunder nor any remedy for the
enforcement thereof shall be impaired, modified, changed or released in any
manner whatsoever by an impairment, modification, change, release or limitation
of the liability of the Borrower, by reason of the Borrower's bankruptcy or
insolvency or by reason of the invalidity or unenforceability of all or any
portion of the Guaranteed Obligations. The obligations of the Guarantor under
this Guaranty shall be automatically reinstated if and to the extent that for
any reason any payment by or on behalf of any Person in respect of the
Guaranteed Obligations is rescinded or must be otherwise restored by any holder
of any of the Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, and the Guarantor agrees that it will
indemnify the Administrative Agent and each Lender on demand for all reasonable
costs and expenses (including, without limitation, reasonable fees and expenses
of counsel) incurred by the Administrative Agent or such Lender in connection
with such rescission or restoration, including any such costs and expenses
incurred in defending against any claim alleging that such payment constituted a
preference, fraudulent transfer or similar payment under any bankruptcy,
insolvency or similar law.
2.4 CERTAIN ADDITIONAL WAIVERS.
The Guarantor agrees that this Guaranty may be enforced by the
Administrative Agent and the Lenders without the necessity of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having recourse to the Borrower under the Credit Agreement, any Hedging
Agreement or any collateral securing the Guaranteed Obligations or otherwise,
and the Guarantor agrees not to assert any right to require the Administrative
Agent and the Lenders to proceed against the Borrower or any other Person
(including any co-guarantor) or to require the Administrative Agent and the
Lenders to pursue any other remedy or enforce any other right. The Guarantor
further acknowledges and agrees that nothing contained in this Guaranty shall
prevent the Administrative Agent or the Lenders from suing the Borrower in
respect of its obligations under the Credit Agreement, any Hedging Agreement and
the other Credit Documents or foreclosing on any security interest or lien on
any collateral securing the Guaranteed Obligations or from exercising any other
rights available to the Administrative Agent and the Lenders under the Credit
Documents or Hedging Agreements if neither the Borrower nor the Guarantor timely
perform their obligations, and the exercise of any of such rights and completion
of any such foreclosure proceedings shall not constitute a discharge of any of
the Guarantor's obligations hereunder unless as a result thereof the Guaranteed
Obligations shall have been paid in full and all of the Commitments shall have
terminated or expired, it being the purpose and intent that the Guarantor's
obligations hereunder be absolute, irrevocable, independent and unconditional
under all circumstances.
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2.5 REMEDIES.
The Guarantor agrees that, to the fullest extent permitted by law, as
between the Guarantor, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Guaranteed Obligations may be declared to be
forthwith due and payable as provided in Section 8.2 of the Credit Agreement
(and shall be deemed to have become automatically due and payable in the
circumstances provided in said Section 8.2 of the Credit Agreement) for purposes
of Section 2.1 notwithstanding any stay, injunction or other prohibition
preventing such declaration (or preventing such Guaranteed Obligations from
becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or such Guaranteed Obligations being deemed to
have become automatically due and payable), such Guaranteed Obligations (whether
or not due and payable by any other Person) shall forthwith become due and
payable by the Guarantor for purposes of Section 2.1.
2.6 FURTHER REPRESENTATIONS AND WARRANTIES.
The Guarantor agrees that the Administrative Agent and the Lenders will
have no obligation to investigate the financial condition or affairs of the
Borrower for the benefit of the Guarantor nor to advise the Guarantor of any
fact respecting, or any change in, the financial condition or affairs of the
Borrower which might come to the knowledge of the Administrative Agent or any
Lender at any time, whether or not the Administrative Agent or any Lender knows
or believes or has reason to know or believe that any such fact or change is
unknown to the Guarantor or might (or does) materially increase the risk of the
Guarantor as Guarantor or might (or would) affect the willingness of the
Guarantor to continue as a guarantor with respect to the Guaranteed Obligations.
2.7 ADDITIONAL LIABILITY OF GUARANTOR.
If the Guarantor is or becomes liable for any indebtedness owing by the
Guarantor to the Administrative Agent or any Lender by endorsement or otherwise
other than under this Guaranty, such liability shall not be in any manner
impaired or reduced hereby but shall have all and the same force and effect it
would have had if this Guaranty had not existed and the Guarantor's liability
hereunder shall not be in any manner impaired or reduced thereby.
2.8 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guaranty in this Section 2 is a guaranty of payment and not of
collection, is a continuing guaranty, and shall apply to all Guaranteed
Obligations whenever owing.
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SECTION 3
REPRESENTATIONS AND WARRANTIES
The Guarantor hereby represents and warrants to the Administrative Agent
and each Lender that:
3.1 FINANCIAL INFORMATION.
(a) The balance sheets of the Guarantor as of January 31, 1999
and the statements of earnings, stockholder's equity and cash flow of
the Guarantor for the Fiscal year then ended, certified by the
Guarantor's independent certified public accountants, which are included
in the Guarantor's Annual Report on Form 10-K for the Fiscal Year ended
January 31, 1999, were prepared in accordance with GAAP consistently
applied and fairly present the financial position of the Guarantor, as
of the respective dates thereof and the results of operations and cash
flow of the Guarantor for the periods then ended. The Guarantor on such
dates had no Contingent Obligations, liabilities for taxes or long-term
leases, forward or long-term commitments or unrealized losses from any
unfavorable commitments that are not reflected in the foregoing
statements or in the notes thereto and that, individually or in the
aggregate, are material.
(b) The unaudited balance sheet of the Guarantor as of October
31, 1999 and the related statements of earnings, stockholder's equity
and cash flow for the periods then ended, certified by the chief
financial officer of the Guarantor, which are included in the Borrower's
Quarterly Report on Form 10-Q for the Fiscal Quarter ended October 31,
1999, were prepared in accordance with GAAP consistently applied (except
to the extent noted therein) and fairly present the financial position
of the Guarantor as of such date and the results of operations and cash
flow for the periods covered thereby, subject to normal year-end audit
adjustments. The Guarantor on such date had no Contingent Obligations,
liabilities for taxes or long-term leases, forward or long-term
commitments or unrealized losses from any unfavorable commitments that
are not reflected in the foregoing statements or in the notes thereto
and that, individually or in the aggregate, are material.
3.2 NO MATERIAL CHANGE.
Since January 31, 1997, there has been no Material Adverse Change.
3.3 ORGANIZATION AND GOOD STANDING.
Each of the Guarantor and, except as would not reasonably be expected to
have a Material Adverse Effect, its Subsidiaries (a) is duly organized, validly
existing and is in good standing under the laws of the jurisdiction of its
incorporation or organization and (b) has the corporate or other necessary power
and authority, and the legal right, to own and operate its property, to carry on
its business as heretofore conducted, to enter into this Guaranty and to carry
out the transactions contemplated thereby. Except as would not reasonably be
expected to have a Material Adverse Effect, each of the Guarantor and the
Subsidiaries possesses all Governmental Approvals, in full
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force and effect, free from burdensome restrictions, that are necessary for the
ownership, maintenance and operation of its properties and conduct of its
business as now conducted, and is not in violation thereof. Each of the
Guarantor and the Subsidiaries is duly qualified and in good standing authorized
to do business in each state or other jurisdiction where the nature of its
business activities conducted or properties owned or leased requires it to be so
qualified and where any failure to be so qualified, individually or in the
aggregate, could have a Material Adverse Effect.
3.4 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
3.4.1 Authorization, Binding Effect, Etc. The execution, delivery
and performance by the Guarantor of this Guaranty has been duly
authorized by all necessary corporate action on the part of the
Guarantor; and this Guaranty has been duly executed and delivered by the
Guarantor and is the legal, valid and binding obligation of the
Guarantor, enforceable against it in accordance with its terms, except
as enforcement may be limited by equitable principles and by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to
creditors' rights generally.
3.4.2 No Conflict. The execution, delivery and performance by the
Guarantor of this Guaranty, and the consummation of the transactions
contemplated thereby, do not and will not (a) violate any provision of
the charter or other organizational documents of the Guarantor, (b)
except for consents that have been obtained and are in full force and
effect, conflict with, result in a breach of, or constitute (or, with
the giving of notice or lapse of time or both, would constitute) a
default under, or require the approval or consent of any Person pursuant
to any Contractual Obligation of the Guarantor, (c) violate any
Applicable Law binding on the Guarantor, or (d) result in or require the
creation or imposition of any Lien on any assets or properties of the
Guarantor or any of its Subsidiaries.
3.4.3 Governmental Approvals. No Governmental Approval is or will
be required in connection with the execution, delivery and performance
by the Guarantor of this Guaranty or the transactions contemplated
thereby.
3.5 LITIGATION.
Except as disclosed on Schedule 3.5, there are no actions, suits or
proceedings pending or, to the best knowledge of the Guarantor, threatened
against or affecting the Guarantor, any Subsidiary or any of its properties
before any Governmental Authority (a) in which there is a reasonable possibility
of an adverse determination that could result in a material liability or have a
Material Adverse Effect or (b) that in any manner draws into question the
validity, legality or enforceability of any Credit Document or any transaction
contemplated thereby.
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3.6 TAXES.
All United States Federal income tax returns and all other material tax
returns required to be filed by the Guarantor or any Subsidiary have been filed
and all Taxes due pursuant to such returns have been paid, except such Taxes, if
any, as are being contested in good faith and as to which adequate reserves have
been established in accordance with GAAP. To the best knowledge of the
Guarantor, there has not been asserted or proposed to be asserted any Tax
deficiency against the Guarantor or any Subsidiary that would be material to the
Guarantor and its Subsidiaries taken as a whole and that is not reserved against
on the financial books of the Guarantor.
3.7 COMPLIANCE WITH LAW.
Neither the Guarantor nor any Subsidiary is in violation of any
Applicable Law, or in default under its charter documents, bylaws or any of its
Contractual Obligations except for such violations or defaults as do not result
in a Material Adverse Effect.
3.8 ERISA.
(a) The Guarantor and all members of the Controlled Group have
fulfilled their obligations under the minimum funding standards of ERISA
with respect to each Plan to which they are party and have not incurred
any liability to the PBGC in connection with any Plan established or
maintained by the Guarantor or any member of the Controlled Group.
(b) No ERISA Event has occurred and is continuing with respect to
any Plan (whether or not terminated). Neither Guarantor nor any member
of the Controlled Group is required to make or accrue a contribution or
has within any of the preceding five plan years made or accrued an
obligation to make contributions to any Multiemployer Plan. The fair
market value of the assets of each Plan is at least equal to the present
value of the "benefit liabilities" (within the meaning of Section
4001(a)(16) of ERISA) under such Plan determined using the actuarial
assumptions and method used by the actuary to such Plan in its valuation
of such Plan.
3.9 GOVERNMENTAL REGULATIONS, ETC.
The Guarantor is neither an "investment company" registered or required
to be registered under the Investment Company Act of 1940, as amended, or a
company controlled by such a company, nor subject to any Federal or state,
statute or regulation limiting its ability to incur Debt for money borrowed
(other than the Margin Regulations).
3.10 MARGIN RELATIONS.
Neither the Guarantor nor any Subsidiary is engaged principally, or as
one of its important activities, in the business of extending credit for the
purposes of purchasing or carrying
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Margin Stock. The value of all Margin Stock held by the Guarantor and the
Subsidiaries constitutes less than 25% of the value, as determined in accordance
with the Margin Regulations, of all assets of the Guarantor.
3.11 SOLVENCY.
The Guarantor is, after consummation of the transactions contemplated by
the Credit Agreement and this Guaranty, individually and together with its
Subsidiaries, Solvent.
3.12 DISCLOSURE.
All information in any document, certificate or written statement
furnished to the Lenders by or on behalf of the Guarantor with respect to the
business, assets, prospects, results of operation or financial condition of the
Guarantor or any Subsidiary for use in connection with the transactions
contemplated by this Agreement has been true and correct in all material
respects. There is no fact known to the Guarantor (other than matters of a
general economic nature) that has had or could reasonably be expected to have a
Material Adverse Effect and that has not been disclosed herein or in such other
documents, certificates or statements.
3.13 YEAR 2000 COMPLIANCE.
The Guarantor has (i) completed a review and assessment of all areas
within its and each of its Subsidiaries' business and operations that could be
adversely affected by the "Year 2000 Problem" (that is, the risk that computer
applications used by the Guarantor or any of its Subsidiaries may be unable to
recognize and perform properly date-sensitive functions involving certain dates
prior to and any date after December 31, 1999), (ii) developed a plan and
timeline for addressing the Year 2000 Problem on a timely basis, and (iii)
substantially completed implementation of that plan in accordance with the
timetable. The Year 2000 Problem has not resulted in, and the Guarantor
reasonably believes that the Year 2000 Problem will not result in, a Material
Adverse Effect.
SECTION 4
AFFIRMATIVE COVENANTS
The Guarantor hereby covenants and agrees that, so long as the Credit
Agreement is in effect or any amounts payable thereunder or under any other
Credit Document shall remain outstanding, and until all of the Commitments
thereunder shall have terminated:
4.1 INFORMATION COVENANTS.
The Guarantor will furnish to the Administrative Agent, for the benefit
of the Lenders:
(a) Annual Financial Statements. As soon as available, and in any
event within 120 days after the close of each Fiscal Year, the
consolidated balance sheet of the
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Guarantor and its consolidated Subsidiaries as of the end of such year
and the related statements of earnings, stockholder's equity and cash
flow of the Guarantor for such Fiscal Year, setting forth in each case
in comparative form the figures for the previous Fiscal Year, all in
reasonable detail and, accompanied by an unqualified report thereon of
Deloitte & Touche LLP or other independent certified public accountants
of recognized national standing selected by the Guarantor and reasonably
satisfactory to the Required Lenders, which report shall state that such
financial statements fairly present the financial position of the
Guarantor as of the date indicated and its results of operations and
cash flows for the periods indicated in conformity with GAAP (except as
otherwise stated therein) and that the examination by such accountants
in connection with such financial statements has been made in accordance
with generally accepted auditing standards;
(b) Quarterly Financial Statements. As soon as available, and in
any event within 60 days after the close of each Fiscal Quarter (other
than the last Fiscal Quarter of any Fiscal Year, in which case 120 days
after the end thereof) a consolidated balance sheet of the Guarantor and
its consolidated Subsidiaries as of the end of such quarter and the
related statements of earnings, stockholder's equity and cash flow for
such quarter and the portion of the Fiscal Year ended at the end of such
quarter, setting forth in each case in comparative form the figures for
the corresponding periods of the prior Fiscal Year, all in reasonable
detail and certified by the Guarantor's chief financial officer as
fairly presenting the financial condition of the Guarantor as of the
dates indicated and its results of operations and cash flows for the
periods indicated, subject to normal year-end adjustments;
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Section 4.1(a) and 4.1(b) above, a
certificate of an chief financial officer or president of the Guarantor,
(i) demonstrating compliance with the financial covenants contained in
Section 4.10 by calculation thereof as of the end of each such fiscal
period and (ii) stating that no Default or Event of Default exists, or
if any Default or Event of Default does exist, specifying the nature and
extent thereof and what action the Guarantor proposes to take with
respect thereto.
(d) Reports. Promptly upon their becoming available, copies of
all material reports, notices and proxy statements sent or made
available by the Guarantor to its security holders, and all material
registration statements (other than the exhibits thereto) and annual,
quarterly or monthly reports, if any, filed by the Guarantor with the
United States Securities and Exchange Commission.
(e) Notices. Within five Business Days after the Guarantor
obtains knowledge thereof, the Guarantor will give written notice to the
Administrative Agent of (i) the occurrence of an event or condition
consisting of a Default or Event of Default, specifying the nature and
existence thereof and what action the Guarantor proposes to take with
respect thereto, (ii) the occurrence of any of the following with
respect to the Guarantor or any of its Subsidiaries (A) the pendency or
commencement of any litigation, arbitral or governmental proceeding
against such Person which if adversely determined is likely to have a
Material
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Adverse Effect, or (B) an ERISA Event, together with a statement setting
forth the details thereof and the action that the Guarantor is taking or
proposes to take with respect thereto, together with a copy of the
notice, if any, of such event given or required to be given to the PBGC;
within five days of the date the Guarantor or any member of the
Controlled Group becomes obliged to make or accrue a contribution to a
Multiemployer Plan, a statement of the Guarantor setting forth the
details thereof and the action that the Guarantor is taking or proposes
to take with respect thereto.
(f) Other Information. With reasonable promptness upon any such
request, such other information regarding the business, properties or
financial condition of the Guarantor and its Subsidiaries as the
Administrative Agent or any Lender (through the Administrative Agent)
may reasonably request.
4.2 PRESERVATION OF EXISTENCE AND FRANCHISES.
The Guarantor will, and will (except as otherwise permitted under
Section 5.3) cause each of its Subsidiaries to, at all times preserve and keep
in full force and effect its corporate existence and all rights and franchises
material to the Guarantor and its Subsidiaries taken as a whole.
4.3 BOOKS AND RECORDS.
The Guarantor shall, and shall cause each Subsidiary to, maintain
adequate books, records and accounts as may be required or necessary to permit
the preparation of financial statements required to be delivered hereunder in
accordance with sound business practices and GAAP. The Guarantor shall, and
shall cause each Subsidiary to, permit such Persons as the Administrative Agent
may designate, at reasonable times during the Guarantor's regular office hours
as often as may reasonably be requested and under reasonable circumstances, to
(a) visit and inspect any of its properties, (b) inspect and copy its books and
records, and (c) discuss with its officers and its independent accountants, its
business, assets, liabilities, results of operation or financial condition.
4.4 CONDUCT OF BUSINESS; COMPLIANCE WITH LAW.
The Guarantor shall not change the general character of its business as
conducted at the Closing Date or engage, directly or through a Subsidiary, in
any type of business not reasonably related to its business as normally
conducted. The Guarantor shall maintain its right to carry on business in any
jurisdiction where it is doing business at such time and remain in and
continuously operate the same lines of business presently engaged in except for
periodic shutdown in the ordinary course of business and interruptions caused by
strike, labor dispute, catastrophe or any other events over which it has no
control. The Guarantor shall, and shall cause each of its Subsidiaries to,
conduct its business in compliance in all material respects with all Applicable
Law and all its Contractual Obligation except where failure to do so does not
result in a Material Adverse Effect.
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4.5 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
The Guarantor shall, and shall cause each Subsidiary to, pay and
discharge (a) all Taxes imposed upon it or any of its properties or in respect
of any of its franchises, business, income or property before any material
penalty shall be incurred with respect to such Taxes, and (b) all claims of any
kind (including claims for labor, material and supplies) that, if unpaid, might
by Applicable Law become a Lien upon any material portion of the property of the
Guarantor and its Subsidiaries; provided, however, that, unless and until
foreclosure, distraint, levy, sale or similar proceedings shall have commenced,
the Guarantor need not pay or discharge any such Tax or claim so long as the
validity or amount thereof is being contested in good faith and by appropriate
proceedings and so long as any reserves or other appropriate provisions as may
be required by GAAP shall have been made therefor.
4.6 INSURANCE.
The Guarantor shall, and shall cause each Subsidiary to, maintain with
financially sound and reputable insurance companies insurance (or adequate self
insurance) in at least such amounts, of such character and against at least such
risks as is usually maintained by companies of established repute engaged in the
same or a similar business in the same general area.
4.7 MAINTENANCE OF PROPERTY.
The Guarantor shall, and shall cause each Subsidiary to, maintain or
cause to be maintained in good repair, working order and condition (ordinary
wear and tear excepted), all properties and other assets useful or necessary to
its business, and from time to time the Guarantor shall make or cause to be made
all appropriate repairs, renewals and replacements thereto except, in each case,
to the extent the failure to do so could not reasonably be expected to have a
Material Adverse Effect. The Guarantor shall, and shall cause each of its
Subsidiaries to, use reasonable efforts to prevent offsets of and defenses to
its receivables and other rights to payment.
4.8 FURTHER ASSURANCES.
At any time and from time to time, upon the request of the
Administrative Agent, the Guarantor shall execute and deliver such further
documents and do such other acts and things as the Administrative Agent may
reasonably request in order to effect fully the purposes of this Guaranty and
any other agreement contemplated hereby and to provide for payment and
performance of the Guaranteed Obligations in accordance with the terms of the
Credit Documents.
4.9 FUTURE INFORMATION.
All data, certificates, reports, statements, documents and other
information the Guarantor shall furnish to the Lenders in connection with the
Credit Documents shall, at the time the information is furnished, not contain
any untrue statement of a material fact shall be complete
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and correct in all material respects to the extent necessary to give the Lenders
sufficient and accurate knowledge of the subject matter thereof, and shall not
omit to state a material fact necessary in order to make the statements
contained therein not misleading in light of the circumstances under which such
information is furnished.
4.10 FINANCIAL COVENANTS.
(a) Consolidated Net Worth. The consolidated Net Worth of the
Guarantor and its Subsidiaries shall, as of the last day of any Fiscal
Quarter, be not less than $750,000,000.
(b) Coverage Ratio. As of the last day of any period of four
consecutive Fiscal Quarters, the Guarantor shall maintain the ratio of
EBITDAR for such period to the sum of interest expense (including
capitalized interest) and rent expense for such period greater than or
equal to 2.0 to 1.0.
4.11 YEAR 2000 COMPLIANCE.
The Guarantor will promptly notify the Administrative Agent in the event
it discovers or determines that the Year 2000 Problem has resulted in, or is
reasonably expected to result in, a Material Adverse Effect.
SECTION 5
NEGATIVE COVENANTS
The Guarantor hereby covenants and agrees that, so long as the Credit
Agreement is in effect or any amounts payable thereunder or under any other
Credit Document shall remain outstanding, and until all of the Commitments
hereunder shall have terminated:
5.1 LIENS.
The Guarantor shall not, and shall not permit any Subsidiary to,
directly or indirectly, create, incur, assume or permit to exist any Lien on or
with respect to any asset of the Guarantor or any Subsidiary, whether now owned
or hereafter acquired, except:
5.1.1. Liens securing the Obligations (as defined in the Nordstrom
Credit Agreement) and Existing Liens;
5.1.2. (a) Liens for Taxes, assessments or charges of any
Governmental Authority for claims that are not material and are not yet due or
are being contested in good faith by appropriate proceedings and with respect to
which adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; (b) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen, bankers and other Liens imposed by law and
created in the ordinary course of business for amounts that are not material and
are not yet due or being contested in good faith by appropriate proceedings and
with respect to which
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adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; (c) Liens incurred and deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other types of social security benefits or to secure the
performance (including by way of surety bonds or appeal bonds) of tenders, bids,
leases, contracts, statutory obligations or similar obligations or arising as a
result of progress payments under contracts, in each case in the ordinary course
of business and not relating to the repayment of Debt; (d) easements,
rights-of-way, covenants, consents, reservations, encroachments, variations and
other restrictions, charges or encumbrances (whether or not recorded) that do
not materially interfere with the ordinary conduct of the Guarantor's business;
(e) building restrictions, zoning laws and other statutes, laws, rules,
regulations, ordinances and restrictions; and (f) leases, subleases or easements
granted in the ordinary course of business to others not materially interfering
with the business of, and consistent with past practices of, the Guarantor;
5.1.3. any attachment or judgment Lien, not otherwise constituting
an Event of Default, in existence less than 30 days after the entry thereof or
with respect to which (a) execution has been stayed, (b) payment is covered in
full by insurance, or (c) the Guarantor is in good faith prosecuting an appeal
or other appropriate proceedings for review and has set aside on its books such
reserves as may be required by GAAP with respect to such judgment or award;
5.1.4. Liens securing Debt of the Guarantor or any Subsidiary,
including Capitalized Leases, used to finance the acquisition of fixed assets of
the Guarantor or such Subsidiary, the construction of additional buildings or
the expansion otherwise of their respective facilities, provided that such Debt
(a) does not exceed the cost to the Guarantor or such Subsidiary of the assets
acquired with the proceeds of such Debt, (b) in the case of new construction or
expansion of existing facilities, is either a construction or permanent loan
secured by the facilities constructed and the real property on which such
facilities are located, and (c) in the case of other asset financing, is
incurred within twelve months following the date of the acquisition, provided
that any such Lien does not encumber any property other than the assets acquired
with the proceeds of such Debt;
5.1.5. Liens existing on assets of any Person at the time such
assets are acquired, provided such Lien does not encumber any assets other than
the assets subject to such Lien at the time such assets are acquired;
5.1.6. Liens arising from the securitization of receivables, to the
extent the Debt arising from such securitization is permitted hereunder;
5.1.7. any Lien constituting a renewal, extension or replacement of
any Existing Lien or any Lien permitted by Section 5.1.4 or 5.1.5., provided
such Lien is limited to all or a part of the property subject to the Lien
extended, renewed or replaced;
5.1.8. Liens on any or all of the assets of Xxxxxxxxx.xxx, LLC
securing Debt owing by Xxxxxxxxx.xxx, LLC under the Xxxxxxxxx.xxx Loan
Agreement; and
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5.1.9. other Liens incidental to the conduct of the business or the
ownership of the assets of the Guarantor or any Subsidiary that (a) were not
incurred in connection with borrowed money, (b) do not in the aggregate
materially detract from the value of the assets subject thereto or materially
impair the use thereof in the operation of such business and (c) do not secure
obligations aggregating in excess of $10,000,000.
5.2 RESTRICTED PAYMENTS.
The Guarantor shall not, and shall not permit any Subsidiary to,
declare, pay or make, or agree to declare, pay or make, any Restricted Payment,
except (a) dividends, distributions or payments by any Subsidiary to the
Guarantor, or (b) if no Default or Event of Default then exists or would result
therefrom (assuming for this purpose that compliance with Section 4.10, is being
measured as of the end of the immediately preceding Fiscal Quarter giving pro
forma effect to the Restricted Payment).
5.3 RESTRICTION ON FUNDAMENTAL CHANGES
The Guarantor shall not, and shall not permit any Subsidiary to, enter
into any merger, consolidation, reorganization or recapitalization, liquidate,
wind up or dissolve or sell, lease, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or substantially all of its or
their business or assets, whether now owned or hereafter acquired, provided that
as long as no Default or Event of Default shall exist after giving effect
thereto (a) any Solvent Subsidiary or other Solvent Person (other than the
Guarantor) may be merged or consolidated with or into the Guarantor (so long as
the Guarantor is the surviving entity) or any Subsidiary, (b) any Subsidiary may
be liquidated, wound up or dissolved, and (c) in addition to transactions
permitted under Section 5.4 (which permitted transactions shall not be
restricted by this Section 5.3), all or substantially all of any Subsidiary's
business or assets may be sold, leased, transferred or otherwise disposed of, in
one transaction or a series of transactions, to the Guarantor or another
Subsidiary.
5.4 ASSET DISPOSITIONS
The Guarantor shall not, and shall not (except as permitted by Section
5.3(c)) permit any Subsidiary to, sell, lease or otherwise dispose of during any
Fiscal Year property or other assets (other than sales of inventory in the
ordinary course of business) constituting, in the aggregate, 10% or more of the
Guarantor's and its Subsidiaries' assets, taken as a whole, in terms of book
value. Notwithstanding the foregoing limitation, the Guarantor and its
Subsidiaries shall be permitted to sell their receivables in a transaction to
securitize such receivables.
5.5 TRANSACTIONS WITH AFFILIATES
The Guarantor shall not, and shall not permit any Subsidiary to, directly or
indirectly, enter into any transaction (including the purchase, sale, lease, or
exchange of any property or the
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rendering of any service) with any Affiliate of the Guarantor, unless (a) such
transaction is not otherwise prohibited by this Guaranty, (b) such transaction
is in the ordinary course of business and (c) if such transaction is other than
with a Wholly-Owned Subsidiary, such transaction is on fair and reasonable terms
no less favorable to the Guarantor or its Subsidiary, as the case may be, than
those terms which might be obtained at the time in a comparable arm's length
transaction with a Person who is not an Affiliate or, if such transaction is not
one which by its nature could be obtained from such other Person, is on fair and
reasonable terms and was negotiated in good faith, provided that this Section
shall not restrict (i) dividends, distributions and other payments and transfers
on account of any shares of Capital Stock of the Guarantor or any Subsidiary
otherwise permissible hereunder, (ii) transactions pursuant to (x) the
Investment Agreement and (y) any agreement between the Guarantor and any
Affiliate of the Guarantor pursuant to which the Guarantor sells or discounts
accounts receivable in the ordinary course of its business (including agreements
under which the Guarantor has an obligation to repurchase from or indemnify the
purchaser with respect to accounts discounted or sold by the Guarantor) and
(iii) supply, service or licensing agreements between or among Xxxxxxxxx.xxx,
LLC, a Delaware limited liability company, and its successors on the one hand,
and the Guarantor and its other Subsidiaries, on the other hand, so long as such
agreements are fair and reasonable to the Guarantor and such other Subsidiaries
under the circumstances.
SECTION 6
EVENTS OF DEFAULT
6.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Guaranty. The guaranty given by the Guarantor hereunder shall
cease to be in full force and effect, or the Guarantor or any Person
acting by or on behalf of the Guarantor shall deny or disaffirm the
Guarantor's obligations under this Guaranty; or
(b) Representations. Any representation, warranty or
certification made or furnished by the Guarantor herein or in any of the
other Credit Documents shall prove to have been false or incorrect in
any material respect when made (or deemed made); or
(c) Covenants. The Guarantor shall
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 4.1(e)(i) or 4.2
(insofar as it requires the preservation of the corporate
existence of the Guarantor) or 5.1 through 5.5, inclusive;
(ii) default in the due performance or observance by it of
any term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) of
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this Section 6.1) contained in this Guaranty and such default shall
continue unremedied for a period of at least 30 days after
written notice thereof by the Administrative Agent to the
Guarantor; or
(d) Other Credit Documents. (i) The Guarantor shall default in
the due performance or observance of any term, covenant or agreement in
this Guaranty (subject to applicable grace or cure periods, if any), or
(ii) any Credit Document shall fail to be in full force and effect or to
give the Administrative Agent and/or the Lenders the Liens, rights,
powers and privileges purported to be created thereby, or the Guarantor
shall so state in writing; or
(e) Bankruptcy, etc.
(i) There shall be commenced against the Guarantor or any of
its Subsidiaries, an involuntary case seeking the liquidation or
reorganization of the Guarantor or any of its Subsidiaries under
Chapter 7 or Chapter 11, respectively, of the Bankruptcy Code or
any similar proceeding under any other Applicable Law or an
involuntary case or proceeding seeking the appointment of a
receiver, liquidator, sequestrator, custodian, trustee or other
officer having similar powers of the Guarantor or any of its
Subsidiaries or to take possession of all or a substantial
portion of its property or to operate all or a substantial
portion of its business, and any of the following events occur:
(a) the Guarantor or any of its Subsidiaries consents to the
institution of the involuntary case or proceeding; (b) the
petition commencing the involuntary case or proceeding is not
timely controverted; (c) the petition commencing the involuntary
case or proceeding remains undismissed and unstayed for a period
of 60 days; or (d) an order for relief shall have been issued or
entered therein; or
(ii) The Guarantor or any of its Subsidiaries shall institute
a voluntary case seeking liquidation or reorganization under
Chapter 7 or Chapter 11, respectively, of the Bankruptcy Code or
any similar proceeding under any other Applicable Law, or shall
consent thereto; or shall consent to the conversion of an
involuntary case to a voluntary case; or shall file a petition,
answer a complaint or otherwise institute any proceeding seeking,
or shall consent to or acquiesce in the appointment of, a
receiver, liquidator, sequestrator, custodian, trustee or other
officer with similar powers of it or to take possession of all or
a substantial portion of its property or to operate all or a
substantial portion of its business; or shall make a general
assignment for the benefit of creditors; or shall generally not
pay its debts as they become due; or the Board of Directors of
the Guarantor or any of its Subsidiaries (or any committee
thereof) adopts any resolution or otherwise authorizes action to
approve any of the foregoing; or
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(f) Defaults under Other Agreements.
(i) The occurrence of an "Event of Default" under the Credit
Agreement;
(ii) (a) The Guarantor or any Subsidiary shall default in the
payment (whether at stated maturity, upon acceleration, upon
required prepayment or otherwise), beyond any period of grace
provided therefor, of any principal of or interest on any other
Debt with a principal amount (individually or in the aggregate)
in excess of $10,000,000, or (b) any other breach or default (or
other event or condition), beyond any period of grace provided
therefor, shall occur under any agreement, indenture or
instrument relating to any such other Debt with a principal
amount (individually or in the aggregate) in excess of
$10,000,000, if the effect of such breach or default (or such
other event or condition) is to cause, or to permit the holder or
holders of the other Debt (or a Person on behalf of such holder
or holders) to cause (upon the giving of notice or otherwise),
such other Debt to become or be declared due and payable, or
required to be prepaid, redeemed, purchased or defeased (or an
offer of prepayment, redemption, purchase or defeasance be made),
prior to its stated maturity (other than by a scheduled mandatory
prepayment); provided, however, that if any such breach or
default described in this Section 6.1(f)(ii) is cured or waived
prior to any action being taken pursuant to Section 6.2, the
Event of Default under this Guaranty in respect of such breach or
default shall be deemed cured to the extent of such cure or
waiver; or
(g) Judgments. The Guarantor or any Subsidiary shall suffer any
money judgments, writs or warrants of attachment or similar processes
that, individually or in the aggregate, involve an amount or value in
excess of $10,000,000 and such judgments, writs, warrants or other
orders shall continue unsatisfied and unstayed for a period of 60 days;
or
(h) ERISA. The Guarantor or any member of the Controlled Group
shall fail to pay when due any material amount or amounts that it shall
have become liable to pay to the PBGC or to a Plan under Title IV of
ERISA; or a proceeding shall be instituted by a fiduciary of any such
Plan or Plans against the Guarantor or any member of the Controlled
Group to enforce Section 515 of ERISA; or any ERISA Event shall occur
which could reasonably be expected to have a Material Adverse Effect; or
the Guarantor or any member of the Controlled Group shall partially or
completely withdraw from any Multiemployer Plan; or any Multiemployer
Plan to which Guarantor or any member of its Controlled Group becomes
obliged to make or accrue a contribution is placed in reorganization or
terminates; or
(i) Ownership. There shall occur a Change of Control.
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6.2 REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the requisite Lenders
(pursuant to the voting requirements of Section 10.6 of the Credit Agreement) or
cured to the satisfaction of the requisite Lenders (pursuant to the voting
procedures in Section 10.6 of the Credit Agreement), the Administrative Agent
may, or shall, upon the request and direction of the Required Lenders, by
written notice to the Credit Parties, enforce any and all rights and interests
created and existing under the Credit Documents including, without limitation,
all rights and remedies existing under the Collateral Documents (including,
without limitation, this Guaranty), all rights and remedies against the
Guarantor and all rights of set-off.
SECTION 7
MISCELLANEOUS
7.1 CUMULATIVE RIGHTS.
All rights of the Administrative Agent and the Lenders hereunder or
otherwise arising under any documents executed in connection with or as security
for the Guaranteed Obligations are separate and cumulative and may be pursued
separately, successively or concurrently, or not pursued, without affecting or
limiting any other right of the Administrative Agent or any Lender and without
affecting or impairing the liability of the Guarantor.
7.2 USURY.
Notwithstanding any other provisions herein contained, no provision of
this Guaranty shall require or permit the collection from the Guarantor of
interest in excess of the maximum rate or amount that the Guarantor may be
required or permitted to pay pursuant to any applicable law. In the event any
such interest is collected, it shall be applied in reduction of the Guarantor's
obligations hereunder, and the remainder of such excess collected shall be
returned to the Guarantor once such obligations have been fully satisfied.
7.3 EXPENSES; INDEMNIFICATION.
(a) The Guarantor agrees that the Guaranteed Obligations include
any obligation of the Borrower to pay all costs and expenses of the
Administrative Agent in connection with the syndication, preparation,
execution, delivery, administration, modification, and amendment of the
Credit Agreement, the other Credit Documents (including, without
limitation, this Guaranty), and the other documents to be delivered
thereunder, including, without limitation, the reasonable fees and
expenses of counsel for the Administrative Agent with respect hereto and
thereto and with respect to advising the Administrative Agent as to its
rights and responsibilities under the Credit Documents. The Guarantor
further agrees that the Guaranteed Obligations include any obligation of
the Borrower to pay all costs and expenses of the Administrative Agent
and the Lenders,
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if any (including, without limitation, reasonable attorneys' fees and
expenses), in connection with the enforcement (whether through
negotiations, legal proceedings, or otherwise) of the Credit Documents
(including, without limitation, this Guaranty) and the other documents
to be delivered pursuant thereto. In the event the Administrative Agent
and/or the Lenders seek enforcement of this Section 7.3(a) against the
Guarantor, such costs and expenses shall be payable on demand.
(b) The Guarantor agrees to indemnify, defend and hold harmless
the Administrative Agent and each Lender and each of their Affiliates
and the officers, directors, employees, agents, attorneys, affiliates,
successors and assigns of the Administrative Agent, each Lender and
their Affiliates (collectively, the "Indemnitees") from and against (i)
any and all transfer taxes, documentary taxes, assessments or charges
made by any Governmental Authority by reason of the execution and
delivery of the Credit Documents or the making of the Loans (provided
that any Lender claiming any additional amounts payable pursuant to this
Section 7.3(b)(i) shall use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office if the making of such a
change would avoid the need for, or reduce the amount of, any such
additional amounts that may thereafter accrue and would not, in the
reasonable judgment of such Lender, be otherwise disadvantageous to such
Lender), and (ii) any and all liabilities, losses, damages, penalties,
judgments, claims, costs and expenses of any kind or nature whatsoever
(including reasonable attorneys' fees, including allocated costs of
in-house counsel, and disbursements in connection with any actual or
threatened investigative, administrative or judicial proceeding, whether
or not such Indemnitee shall be designated a party thereto) that may be
imposed on, incurred by or asserted against such Indemnitee, in any
manner relating to or arising out of the Credit Documents, the Loans, or
the use or intended use of the proceeds of the Loans (the "Indemnified
Liabilities"); provided that no Indemnitee shall have the right to be
indemnified or held harmless hereunder for its own gross negligence, or
willful misconduct, as determined by a final judgment of a court of
competent jurisdiction. The Guarantor agrees not to assert any claim
against the Administrative Agent, any Lender, any of their Affiliates,
or any of their respective directors, officers, employees, attorneys,
agents, and advisers, on any theory of liability, for special, indirect,
consequential, or punitive damages arising out of or otherwise relating
to the Credit Documents (including, without limitation, this Guaranty),
any of the transactions contemplated herein or the actual or proposed
use of the proceeds of the Loans.
(c) To the extent that the undertaking to indemnify and hold
harmless set forth in this Section 7.3 may be unenforceable as violative
of any applicable law or public policy, the Guarantor shall make the
maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities that is permissible under applicable law. All
Indemnified Liabilities shall be payable on demand.
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(d) Without prejudice to the survival of any other agreement of
the Guarantor hereunder, the agreements and obligations of the Guarantor
contained in this Section 7.3 shall survive the repayment of the
Guaranteed Obligations.
7.4 RIGHT OF SET-OFF.
After the occurrence of an Event of Default, any Lender may set-off any
matured obligation owed by the Guarantor under this Guaranty (to the extent
beneficially owned or held by such Lender) against any obligation (whether or
not matured) owed by such Lender to the Guarantor, regardless of the place of
payment.
7.5 TERM OF GUARANTEE.
This Guaranty shall continue in full force and effect until the
Guaranteed Obligations are fully and indefeasibly paid, performed and discharged
and all Commitments have expired or been terminated. This Guaranty covers the
Guaranteed Obligations whether presently outstanding or arising subsequent to
the date hereof including all amounts advanced by the Administrative Agent or
any Lender in stages or installments.
7.6 THE ADMINISTRATIVE AGENT.
In acting under or by virtue of this Guaranty, the Administrative Agent
shall be entitled to all the rights, authority, privileges and immunities
provided in the Credit Agreement, all of which provisions are incorporated by
reference herein with the same force and effect as if set forth herein.
7.7 SUCCESSORS AND ASSIGNS.
This Guaranty shall be binding on and enforceable against the Guarantor
and its successors and assigns; provided that, the Guarantor may not assign or
transfer any of its obligations hereunder without prior written consent of the
Lenders. This Guaranty is intended for and shall inure to the benefit of the
Administrative Agent and each Lender and each and every person who shall from
time to time be or become the owner or holder of any of the Guaranteed
Obligations, and each and every reference herein to "Administrative Agent" or
"Lender" shall include and refer to each and every successor or assignee of the
Administrative Agent or any Lender at any time holding or owning any part of or
interest in any part of the Guaranteed Obligations. This Guaranty shall be
transferable and negotiable with the same force and effect, and to the same
extent, that the Guaranteed Obligations are transferable and negotiable, it
being understood and stipulated that upon assignment or transfer by the
Administrative Agent or any Lender of any of the Guaranteed Obligations the
legal holder or owner of the Guaranteed Obligations (or a part thereof or
interest therein thus transferred or assigned by the Administrative Agent or any
Lender) shall (except as otherwise stipulated by the Administrative Agent or any
such Lender in its assignment) have and may exercise all of the rights granted
to the Administrative Agent or such Lender under this Guaranty to the extent of
that part of or interest in the Guaranteed Obligations thus assigned or
transferred to said person. The Xxxxxxxxx
00
00
expressly waives notice of transfer or assignment by the Lenders of the
Guaranteed Obligations, or any part thereof, or of the rights of the
Administrative Agent or any Lender hereunder. Failure to give notice will not
affect the liabilities of the Guarantor hereunder.
7.8 APPLICATION OF PAYMENTS.
Each of the Administrative Agent and the Lenders may apply any payments
received by it from any source against that portion of the Guaranteed
Obligations (principal, interest, court costs, attorneys' fees or other) in such
priority and fashion as it may deem appropriate.
7.9 MODIFICATIONS.
Subject to the terms of the Credit Agreement, this Guaranty and the
provisions hereof may be changed, discharged or terminated only by an instrument
in writing signed by the Guarantor and the Administrative Agent.
7.10 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address set forth below or at such other address as such party may specify
by written notice to the other parties hereto:
if to the Guarantor:
Nordstrom, Inc.
0000 0xx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Chief Financial Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Administrative Agent:
Bank of America, N.A.
0000 Xxxxxxx Xxxx., 0xx Xxxxx
Mail Code CA4-706-05-09
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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with a copy to:
Bank of America, N. A.
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Mail Code: CA5-705-41-89
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
7.11 TAXES.
All payments made by the Guarantor under this Guaranty and any other
Credit Documents shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by any court, or
governmental body, agency or other official, excluding taxes measured by or
imposed upon the overall net income of any Lender or its applicable lending
office, or any branch or affiliate thereof, and all franchise taxes, branch
taxes, taxes on doing business or taxes on the overall capital or net worth of
any Lender or its applicable lending office, or any branch or affiliate thereof,
in each case imposed in lieu of net income taxes, imposed: (i) by the
jurisdiction under the laws of which such Lender, applicable lending office,
branch or affiliate is organized or is located, or in which its principal
executive office is located, or any nation within which such jurisdiction is
located or any political subdivision thereof; or (ii) by reason of any
connection between the jurisdiction imposing such tax and such Lender,
applicable lending office, branch or affiliate other than a connection arising
solely from such Lender having executed, delivered or performed its obligations,
or received payment under or enforced, this Guaranty or any other Credit
Document. If any such non-excluded taxes, levies, imposts, duties, charges,
fees, deductions or withholdings ("Non-Excluded Taxes") are required to be
withheld from any amounts payable to the Administrative Agent or any Lender
under this Guaranty or under any other Credit Document, (A) the amounts so
payable to the Administrative Agent or such Lender shall be increased to the
extent necessary to yield to the Administrative Agent or such Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Guaranty and any
other Credit Document, and (B) as promptly as possible thereafter the Guarantor
shall send to the Administrative Agent for its own account or for the account of
such Lender, as the case may be, a certified copy of an original official
receipt received by the Guarantor showing payment thereof. If the Guarantor
fails to pay any Non-Excluded Taxes when due to the appropriate taxing authority
or fails to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Guarantor shall indemnify the Administrative
Agent and the Lenders for any incremental taxes, interest or penalties that may
become payable by the Administrative Agent or any Lender as a result of any such
failure. The agreements in this subsection shall survive the termination of this
Guaranty and the other Credit Documents. If the Guarantor is required to pay
additional amounts to or for the account of any Lender pursuant to this Section
7.11, such Lender has agreed in Section 3.11(f) of the Credit Agreement to use
reasonable efforts to change its
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Applicable Lending Office so as to eliminate or reduce any such additional
payment which may thereafter accrue if such change, in the reasonable judgment
of such Lender, is not otherwise disadvantageous to such Lender.
7.12 SEVERABILITY.
If any provision of this Guaranty is determined to be illegal, invalid
or unenforceable, such provision shall be fully severable and the remaining
provisions shall remain in full force and effect and shall be construed without
giving effect to the illegal, invalid or unenforceable provisions.
7.13 GOVERNING LAW.
This Guaranty and the rights and obligations of the parties hereto shall
be construed in accordance with and governed by the laws of the State of
Washington.
7.14 WAIVER OF JURY TRIAL.
To the extent permitted by law, each of the Administrative Agent and the
Guarantor hereby irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim arising out of or relating to this Guaranty or the
transactions contemplated hereby.
7.15 CONSENT TO JURISDICTION.
(a) Any legal action or proceeding with respect to this Guaranty may be
brought in the courts of the State of Washington in King County, or of the
United States for the Western District of Washington, and, by execution and
delivery of this Guaranty, the Guarantor hereby irrevocably accepts for itself
and in respect of its property, generally and unconditionally, the nonexclusive
jurisdiction of such courts. Nothing herein shall affect the right of the
Administrative Agent or any Lender to serve process in any manner permitted by
law or to commence legal proceedings or to otherwise proceed against the
Guarantor in any other jurisdiction.
(b) The Guarantor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Guaranty in the courts referred to in Section
7.15(a). Each of the parties hereto hereby further irrevocably waives and agrees
not to plead or claim in any such court that any such action or proceeding
brought in any such court has been brought in an inconvenient forum.
(c) Each party to this Guaranty irrevocably consents to service of
process in the manner provided for notices in Section 7.10. Nothing in this
Guaranty will affect the right of any party to this Guaranty to serve process in
any other manner permitted by law.
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7.16 HEADINGS.
The headings in this instrument are for convenience of reference only
and shall not limit or otherwise affect the meaning of any provisions hereof.
7.17 COUNTERPARTS.
This Guaranty may be executed in any number of counterparts and by
different parties hereto on separate counterparts, each constituting an
original, but all together one and the same instrument.
7.18 RIGHTS OF THE REQUIRED LENDERS.
All rights of the Administrative Agent hereunder, if not exercised by
the Administrative Agent, may be exercised by the Required Lenders.
7.19 ORAL AGREEMENTS NOT BINDING.
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON
LAW.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed and delivered as of the day and year first above written.
GUARANTOR: NORDSTROM, INC.,
a Washington corporation
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
ACCEPTED:
BANK OF AMERICA, N.A.,
as Administrative Agent, on behalf of the Lenders
By:
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Name:
------------------------------------
Title:
-----------------------------------
