ATLAS COPCO AB GUARANTY
THIS GUARANTY (this "Guaranty"), dated as of June ___, 1999, by ATLAS
COPCO AB, a corporation formed and organized under the laws of the Kingdom of
Sweden ("Guarantor"), in favor of Rental Service Corporation, a Delaware
corporation ("RSC"). Guarantor hereby unconditionally guarantees to RSC the
prompt payment and performance of the obligations and agreements of each of
Atlas Copco North America Inc. ("Parent") and Pandion Acquisition Corp.
("Purchaser") under the Agreement and Plan of Merger (the "Merger Agreement"),
dated as of June 28, 1999, by and among Parent, Purchaser and RSC; provided,
however, that this undertaking and agreement shall terminate immediately
following the earlier of (i) the Effective Time of the Merger (as each is
defined in the Merger Agreement) and (ii) the termination of the Merger
Agreement in accordance with its terms. Guarantor agrees that this Guaranty is
a guaranty of payment and performance and not of collection, and that its
obligations under this Guaranty shall be primary, absolute and unconditional,
irrespective of, and unaffected by:
(a) the genuineness, validity, regularity, enforceability or any
future amendment of, or change in this Guaranty, the Merger
Agreement or any other agreement, document or instrument to which
Guarantor, Parent, Purchaser and/or RSC is or may become a party;
(b) the absence of any action to enforce this Guaranty or the Merger
Agreement or the waiver or consent by RSC with respect to any of
the provisions thereof;
(c) the insolvency of Parent or Purchaser; or
(d) any other action or circumstances which might otherwise
constitute a legal or equitable discharge or defense of a surety
or guarantor.
In addition to the waivers set forth above, Guarantor waives and agrees
that it shall not at any time insist upon, plead or in any manner whatever claim
or take the benefit or advantage of, any appraisal, valuation, stay, extension,
marshaling of assets or redemption laws, or exemption, whether now or at any
time hereafter in force, which may delay, prevent or otherwise affect the
performance by Guarantor of its obligations under, or the enforcement by RSC of,
this Guaranty. Guarantor hereby waives diligence, presentment and demand
(whether for non-payment or protest or of acceptance, maturity, extension of
time, change in nature or form of the obligations, acceptance of further
security, release of further security, composition or agreement arrived at as to
the amount of, or the terms of, the obligations under this Guaranty, notice of
adverse change in Parent's or Purchaser's financial condition or any other fact
which might increase the risk to Guarantor) with respect to any of the
obligations under this Guaranty or all other demands whatsoever and, except as
otherwise provided in this Guaranty, waives the benefit of all provisions of law
which are or might be in conflict with the terms of this Guaranty.
Guarantor represents, warrants and agrees that, as of the date of this Guaranty,
its obligations under this Guaranty are not subject to any offsets or defense
against RSC, Parent or Purchaser of any kind. Guarantor further agrees that its
obligations under this Guaranty shall not be subject to any counterclaims,
offsets or defenses against RSC, Parent or Purchaser of any kind which may arise
in the future. It is agreed between Guarantor and RSC that the foregoing
waivers are the essence of the transaction contemplated by the Merger Agreement
and that, but for this Guaranty and such waivers, RSC would not have entered
into or would decline to enter into the Merger Agreement.
Guarantor hereby represents and warrants to RSC that (1) it has full
corporate power and authority to execute and deliver this undertaking and
perform its obligations hereunder, (2) it has taken all corporate actions
necessary to authorize the execution, delivery and performance of this
undertaking by it, (3) such execution, delivery and performance do not conflict
with, violate or otherwise result in a default under its Certificate of
Incorporation, By-laws or other organizational documents, and (4) this
undertaking is the legal, valid and binding obligation of the undersigned,
enforceable in accordance with its terms, except that (A) such enforcement may
be subject to applicable bankruptcy, insolvency or similar laws, now or
hereafter in effect, affecting creditors' rights generally, and (B) the remedy
of specific performance and injunctive and other forms of equitable relief may
be subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought.
This Guaranty shall remain in full force and effect and continue to be
effective should any petition be filed by or against Guarantor, Parent or
Purchaser for liquidation or reorganization, should Guarantor, Parent and/or
Purchaser become insolvent or make an assignment for the benefit of creditors or
should a receiver or trustee be appointed for all or any significant part of
Guarantor's, Parent's and/or Purchaser's assets, and shall continue to be
effective or be reinstated, as the case may be, if at any time payment and
performance of the obligations under this Guaranty, or any part thereof, are,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by RSC, all as though such payment or performance had not
been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned, the obligations under this Guaranty shall be
reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.
This Guaranty shall be governed and construed in accordance with the
laws of the State of Delaware, without regard to the laws that might be
applicable under conflicts of laws principles. The choice of the laws of the
State of Delaware as the governing law of this Guaranty shall be upheld as a
valid choice of law in any action in the Swedish courts.
Guarantor hereby irrevocably and unconditionally submits, for itself and
its property, to the exclusive jurisdiction of any Delaware State court, or
Federal court of the United States of America, sitting in Delaware, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Guaranty or the transactions contemplated hereby or for
recognition or enforcement of any judgment relating thereto, and each of the
parties hereby irrevocably and unconditionally (i) agrees not to commence any
such action or proceeding
except in such courts, (ii) agrees that any claim in respect of any such action
or proceeding may be heard and determined in such Delaware State court or, to
the extent permitted by law, in such Federal court, (iii) 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 such action or proceeding in any
such Delaware State or Federal court, and (iv) 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 Delaware State or 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, including, without limitation,
any judgment in relation to this Guaranty obtained in any Delaware State court
or Federal court of the United States of America, sitting in Delaware, against
Guarantor shall be recognized and enforced in Sweden without retrial or
examination of the merits in the case.
GUARANTOR ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS GUARANTY IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS GUARANTY. GUARANTOR CERTIFIES AND ACKNOWLEDGES THAT
(i) 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 EITHER OF SUCH WAIVERS, (ii) IT UNDERSTANDS AND HAS
CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, AND (iii) IT MAKES SUCH WAIVERS
VOLUNTARILY.
IN WITNESS WHEREOF, the undersigned has executed and delivered
this Guaranty as of the date first above written.
ATLAS COPCO AB
(public)
By: /s/ Xxxxxxx Xxxxxxxxx
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Name: Xxxxxxx Xxxxxxxxx
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Title: Senior Vice President
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By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
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Title: Vice President
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