GUARANTY AGREEMENT OF XXXXXX XXXXXX INTERNATIONAL INC.
THIS GUARANTY AGREEMENT, dated as of December 8, 1999, by XXXXXX XXXXXX
INTERNATIONAL INC., a Delaware corporation with an address at 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, telecopier #212-972-9700 (the "Guarantor") in favor of
FLEET BANK, N.A., a national banking association with offices at 000 Xxxxxxxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000, telecopier #000-000-0000 (the "Lender").
WITNESSETH:
Background. Pursuant to that certain Promissory Note dated as of the date
hereof, as the same may be amended from time to time, of Xxxxxx Xxxxxx Japan,
Inc., a corporation organized under the laws of Japan (the "Borrower") payable
to the order of the Lender (as the same may be amended from time to time, the
"Note"), the Lender has extended a loan to the Borrower in the original
principal sum of One Billion One Hundred Million Japanese Yen ('Y'1,100,000,000)
(the "Loan"). The Guarantor is a shareholder of the Borrower and the proceeds
of the Loan were used to repay a loan from the Guarantor to the Borrower.
Therefore, as the financing of the Borrower by the Lender will result in a
financial benefit to the Guarantor, the Guarantor desires to guaranty the
payment and performance of the obligations, indebtedness and liabilities of
the Borrower to the Lender on the terms and conditions, and subject to the
limitations, hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and intending to be
legally bound hereby, the Guarantor hereby agrees as follows:
1. In consideration of any and all loans, advances, acceptances, discounts
and extensions of credit made by the Lender to the Borrower, and as an
inducement for the Lender to make future loans, advances, acceptances, discounts
and extensions of credit, or consign, sell or deliver precious metals, to, for
the account of, or on behalf of the Borrower, the Guarantor hereby absolutely
and unconditionally guarantees to the Lender, the punctual payment in full of
the principal, interest and all other sums and amounts due and to become
due from the Borrower to the Lender, at any time and from time to time from
the date hereof until termination of the liability of the Guarantor hereunder
to the extent hereinafter provided, on account of any and all obligations,
indebtedness and liabilities of the Borrower to the Lender, whether now
existing or hereafter incurred, whether direct, indirect or contingent,
whether otherwise guaranteed or secured, and whether on open account or
evidenced by a note, draft, check or other agreement, instrument or document
(all of which obligations, indebtedness and liabilities are hereinafter referred
to individually as an "Obligation" and collectively as the "Obligations"),
including, without limitation, all obligations, indebtedness and liabilities
evidenced by or incurred pursuant to that certain Promissory Note of even date
herewith in the original principal amount of One Billion One Hundred Million
Japanese Yen ('Y'1,100,000,000) issued by the Borrower to the Lender, as
the same may be amended from time to time (collectively, the "Financing
Agreements").
2. The Guarantor hereby expressly waives the following: notice of the
incurring of indebtedness by the Borrower; presentment and demand for payment,
protest, notice of protest and notice of dishonor or non-payment of any
instrument evidencing Obligations of
the Borrower; any right to require suit against the Borrower or any other
party before enforcing this guaranty; any right to have security applied
before enforcing this guaranty; notice of acceptance of this guaranty; notice
of any default hereunder or under any agreement evidencing any of the
Obligations; all other notices and demands otherwise required by law which the
Guarantor may lawfully waive; and any right of subrogation to the Lender'
rights against the Borrower until the Borrower's Obligations are paid in full.
The Guarantor hereby expressly agrees that the Lender may, in its sole and
absolute discretion, without notice to or further assent of the Guarantor,
and without in any way releasing, affecting or impairing the obligations and
liabilities of the Guarantor hereunder: (i) waive compliance with, or any
default under, or grant any other indulgences with respect to, any of the
Obligations or any agreement or instrument securing any of the Obligations;
(ii) modify, amend or change any provisions of any of the Obligations; (iii)
grant extensions or renewals of or with respect to any of the Obligations,
and/or effect any release, compromise or settlement in connection therewith;
(iv) agree to the substitution, exchange, release or other disposition of all
or any part of the collateral at any time securing any Obligation; (v) make
advances for the purposes of performing any term or convenant contained in
any agreement evidencing any of the Obligations or any instrument or agreement
securing the Obligations, with respect to which the Borrower shall be in
default; (vi) assign or otherwise transfer any agreement evidencing any of the
Obligations and any instrument or agreement securing the Obligations, including
without limitation, this guaranty, or any interest therein; and deal in all
respects with the Borrower as if this guaranty were not in effect. The
obligations of the Guarantor under this guaranty shall be unconditional,
irrespective of the genuineness, validity, regularity or enforceability of
any agreement evidencing any of the Obligations or any other circumstances
which might otherwise constitute a legal or equitable discharge of a surety
or guarantor.
3. As a material inducement to the Lender to accept this Agreement, the
Guarantor represents and warrants to Lender, which representations and
warranties shall be continuing representations and warranties during the term
of this Agreement and so long as any amount is due and owing the Lender
under the Obligations, as follows:
(a) Guarantor (i) is duly organized, validly existing and in good standing
under the laws of its state of incorporation, (ii) has the requisite
corporate power and authority to own its properties and to carry
on business as now being conducted, and holds all material permits,
authorizations and licenses, without material restrictions or
limitations, which are necessary for such ownership or business
activity, and (iii) is qualified to do business in every jurisdiction
where such qualification is necessary except where the failure to so
qualify would not have a material adverse effect on the business of
the Guarantor, and has the requisite corporate power to execute,
deliver and perform this Agreement, the Pledge Agreement of the
Guarantor dated the date hereof in favor of the Lender (the "Pledge
Agreement"), and any documents executed or delivered in connection
with the obligations of the Guarantor under this Agreement. Guarantor
has no reason to believe that any such material permits, authorizations
or licenses will be revoked, canceled, rescinded, modified or lost.
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(b) The execution, delivery and performance by the Guarantor of the terms
and provisions of this Agreement, the Pledge Agreement, and any other
such document(s) have been duly authorized by all requisite corporate
action and will not violate any provision of law, any order of any
court or other agency of government, the articles of incorporation
or the by-laws of the Guarantor or any material indenture, agreement
or other instrument to which Guarantor is party, or by which Guarantor
is bound, or be in conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under, or, except
as may be provided by the Pledge Agreement, result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever
upon any of the property or assets of the Guarantor pursuant to, any
such indenture, agreement or other instrument.
(c) Except as disclosed in the Guarantor's filings with the Securities and
Exchange Commission, there is no action, suit or proceedings at law
or in equity or by or before any governmental instrumentality or
other agency now pending or, to the knowledge of the Guarantor
threatened, against or affecting the Guarantor which, if adversely
determined, would have a material adverse effect on the business,
operations, properties, assets or condition, financial or otherwise,
of the Guarantor.
(d) Guarantor is not a party to any agreement or instrument or subject to
any charter or other corporate restriction adversely affecting in any
material respect its business, properties or assets, operations or
conditions, financial or otherwise.
(e) Guarantor is not in default in the performance, observance or
fulfillment of any of the obligations, convenants or conditions
contained in any agreement or instrument to which it is a party that
would have a material adverse effect on the Guarantor.
(f) Except as disclosed in the Guarantor's filings with the Securities and
Exchange Commission, no statement of fact made by or on behalf of the
Guarantor in this Agreement or in any certificate or schedule
furnished to the Lender pursuant hereto, contains any untrue statement
of a material fact or omits to state any material fact necessary to
make statements contained therein or herein not misleading. Except as
disclosed in the Guarantor's filings with the Securities and Exchange
Commission, there is no fact presently known to the Guarantor which
has not been disclosed to the Lender which materially affects adversely,
nor as for as the Guarantor can reasonably foresee, will materially
affect adversely the property, business, operations or condition
(financial or otherwise) of the Guarantor.
(g) This Agreement, the Pledge Agreement, and all other agreements executed
or delivered in connection with this Agreement have been duly executed
and delivered by the Guarantor and constitute legal, valid and binding
obligations of the Guarantor, enforceable in accordance with their
respective terms,
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subject to bankruptcy, insolvency, reorganization and other similar
laws of general application affecting the rights of creditors generally.
(h) The financial statements heretofore delivered to the Lender by the
Guarantor fully and fairly present the financial condition at the dates
thereof of the Guarantor.
4. The Guarantor covenants and agrees that, from the date hereof and until
payment and performance in full of all obligations of the Guarantor hereunder,
the Guarantor shall pay, observe and perform all of terms, conditions and
obligations of the Borrower set forth in the certain Loan Agreement dated as
of May 14, 1996, as amended from time to time between the Lender, Bank Leumi
USA and the Borrower.
5. The liability of the Guarantor under this guaranty shall be primary,
direct and immediate and not conditional or contingent upon pursuit by the
Lender of any remedies it may have against the Borrower or any other party
with respect to the Obligations or any instrument or agreement securing
the Obligations, whether pursuant to the terms thereof or otherwise. No
exercise or nonexercise by the Lender of any right given to it hereunder or
under any agreement evidencing any of the Obligations or any instrument or
agreement securing any of the Obligations, and no change, impairment or
suspension of any right or remedy of the Lender shall in any way affect any
of the Guarantor's obligations hereunder or give the Guarantor any recourse
against the Lender. Without limiting the generality of the foregoing, the
Lender shall not be required to make any demand on the Borrower and/or any
other party, or otherwise pursue or exhaust its remedies against the Borrower
or any other party, before, simultaneously with or after, enforcing its rights
and remedies hereunder against the Guarantor. Any one or more successive
and/or concurrent actions may be brought hereon against the Guarantor either
in the same action, if any, brought against the Borrower and/or any other
party, or in separate actions, as often as any holder of an Obligation, in its
sole discretion, may deem advisable. Any action brought on this guaranty with
respect to one or more Obligations shall not prevent the commencement of
subsequent or separate actions with respect to any other Obligations.
6. All notices and other communications hereunder (hereinafter, "Notices")
shall be in writing, except as otherwise provided in this Agreement; and
shall be sent by any one of the following: certified mail, return receipt
requested; overnight courier; confirmed telecopier; or by hand and shall
addressed (i) if to the Guarantor, to it at its address hereinabove set
forth, and (ii) if to the Lender, to it at its address hereinabove set forth.
Notices shall be deemed effective three (3) days after deposit in the mail,
if sent by certified mail; the next business day, if sent by overnight
courier; upon confirmation, if sent by confirmed telecopier; and upon delivery,
if sent by hand. The address of any party hereto for such demands, notices and
other communications may be changed by giving notice in writing at any time
to the other party hereto.
7. Any payments made by the Guarantor under the provisions of this
guaranty shall be made to the Lender at its office at its address first set
forth above, unless some other address is hereafter designated by the Lender.
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8. All rights and remedies afforded to the Lender by reason of this
guaranty or by law are separate and cumulative and the exercise of one shall
not in any way limit or prejudice the exercise of any other such rights or
remedies. No delay or omission by the Lender in exercising any such right or
remedy shall operate as a waiver thereof. No waiver of any rights or remedies
hereunder, and no modification or amendment hereof, shall be deemed made by
the Lender unless in writing and duly executed. Any such written waiver shall
apply only to the particular instance specified therein and shall not impair
the further exercise of such right or remedy or of any other right or remedy of
the Lender, and no single or partial exercise of any right or remedy hereunder
shall preclude further exercise of any other right or remedy.
9. The obligation of the Guarantor to make payment in accordance with the
terms of this guaranty shall not be impaired, modified, changed, released or
limited in any manner whatsoever by any impairment, modification, change,
release or limitation of the liability of the Borrower or its estate in
bankruptcy or reorganization resulting from the operation of any present or
future provision of Title 11 of the United States Code or other statute or from
the decision of any court. The obligations of the Guarantor hereunder shall
survive any judgment, order, or decree subordinating or voiding in whole or in
part the obligations of the Borrower to the Lender and shall extend to the
repayment of any sums recovered from the Lender on any basis (including any
provision of Xxxxxxx 0 xx Xxxxx 00, Xxxxxx Xxxxxx Code) either before or
after satisfaction in full by the Borrower of its obligations to the Lender.
10. In the event of any breach of the covenants and agreements set forth
herein which shall remain incurred following the expiration of 30 days after
notice thereof from the Lender to the Guarantor. ("Event of Default"), all
indebtedness of the Borrower, regardless of its terms, shall, at the Lender's
election, be deemed for the purposes of this guaranty to have become matured,
and at the Lender's election, the Guarantor shall promptly pay to the Lender
the entire amount of said indebtedness of the Borrower, and the Lender may
take any action deemed necessary or advisable to enforce this guaranty.
11. In the event that a petition in bankruptcy or for an arrangement or
reorganization of, or for an order for relief with respect to, the Borrower
under the bankruptcy laws or for the appointment of a receiver for the
Borrower or any of its property is filed by the Borrower or such a
petition or order is filed against the Borrower and is not dismissed
following the expiration of a period of ninety (90) days or if the Borrower
shall make an assignment for the benefit of creditors or shall become
insolvent, or if a default shall occur under or with respect to any of the
Obligations, all indebtedness of the Borrower shall, for the purpose of this
guaranty, be deemed at the Lenders' election to have become immediately due
and payable.
12. The Guarantor further agrees to pay the Lender any and all costs,
expenses and reasonable attorneys' fees paid or incurred by the Lender in
collecting or endeavoring to collect the indebtedness of the Borrower or in
enforcing or endeavoring to enforce this guaranty.
13. This guaranty shall operate as an irrevocable and continuing guaranty
of all obligations, liabilities and indebtedness of the Borrower incurred
under the Financing Agreements.
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14. The Guarantor hereby grants to the Lender, a lien, security interest
and right of set off as security for all liabilities and obligations to the
Lender, whether now existing or hereafter arising, upon and against all
deposits, credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of the Lender or any entity under the control
of Fleet Financial Group, Inc., or in transit to any of them. At any time,
without demand or notice, the Lender may set off the same or any part thereof
and apply the same to any liability or obligation of Guarantor even though
unmatured and regardless of the adequacy of any other collateral securing the
Obligations. ANY AND ALL RIGHTS TO REQUIRE THE LENDER TO EXERCISE ITS RIGHTS OR
REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS,
PRIOR TO EXERCISING ITS RIGHT OF SET OFF WITH RESPECT TO SUCH DEPOSITS, CREDITS
OR OTHER PROPERTY OF THE GUARANTOR, ARE HEREBY KNOWINGLY, VOLUNTARILY AND
IRREVOCABLY WAIVED.
15. THE GUARANTOR AND THE LENDER MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY
CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY
AGREEMENT OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL
INDUCEMENT FOR THE LENDER TO ACCEPT THIS GUARANTY AGREEMENT AND MAKE THE LOAN.
16. The Guarantor, to the extent that Guarantor may lawfully do so, hereby
submits to the jurisdiction of the courts of the City of New York, State of
New York and the United States District Court for the Southern District of New
York; as well as to the jurisdiction of all courts from which an appeal may be
taken from the aforesaid courts, for the purpose of any suit, action or other
proceeding arising out of any of the Guarantor's obligations under or with
respect to this guaranty, and expressly waives any and all objections
Guarantor may have as to venue in any of such courts.
17. This guaranty shall be governed by and construed in accordance with
the laws of the State of New York without regard to the conflicts of laws
provisions thereof.
18. This guaranty shall be binding upon the Guarantor and the Guarantor's
successors and assigns, and shall inure to the benefit of Lender and its
successors and assigns. The terms "Guarantor" and "Borrower" and any pronouns
referring thereto as used herein shall be construed in the masculine, feminine,
neuter, singular or plural as the context may require.
19. Yen ('Y'), the currency in which the Loan is made and denominated, and
the place of payment designated therefor is of the essence. The payment
obligation of the Guarantor hereunder in Yen ('Y') and the designated place of
payment shall not be discharged by an amount paid in another currency or in
another place, whether pursuant to a judgment or otherwise, to the extent that
the amount so paid on prompt conversion to Yen ('Y') and transfer to the
designated place of payment under normal banking procedures does not yield the
amount owing hereunder at the designated place of payment. In the event that any
payment by the Guarantor, whether pursuant to a judgment or otherwise,
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upon such conversion and transfer, does not result in payment of such amount
in Yen ('Y') at the designated place of payment, the Lender shall be entitled to
demand immediate payment of, and shall have a separate cause of action
against the Company for, the additional amount necessary to yield the amount
of Yen ('Y') owing hereunder. In the event that any payment by the Guarantor,
whether pursuant to a judgment or otherwise, upon such conversion and transfer,
results in payment of Yen ('Y') at the designated place of payment in an amount
greater than the amount owing, the Lender shall immediately remit the excess
to the Guarantor.
20. If any sum due from the Borrower under the Note, the Guarantor under
the Guaranty Agreement or any order or judgment given or made in relation
hereto has to be converted from Yen ('Y') into another currency (the "second
currency") for the purpose of (a) making or filing a claim or proof against
the Borrower or the Guarantor with any governmental authority or in any court
or tribunal or (b) obtaining or enforcing any order or judgment given or made
in relation hereto, the Guarantor shall indemnify and hold harmless each of
the persons or entities to whom such sum is due from and against any loss
actually suffered as a result of any discrepancy between (i) the rate of
exchange used to convert the amount in question from Yen ('Y') into the second
currency and (ii) the rate or rates of exchange at which such person or entity,
acting in good faith, purchased Yen ('Y') with the second currency after receipt
of a sum paid to it in the second currency in satisfaction, in whole or in
part, of any such order, judgment, claim or proof. The foregoing indemnity
shall constitute a separate obligation of the Guarantor distinct from its
other obligations hereunder and shall survive the giving or making of any
judgment or order in relation to all or any of such other obligations. In the
event that any sum due from the Borrower under the Note, the Guarantor under
the Guaranty Agreement or any order or judgment given or made in relation
hereto has to be converted from Yen ('Y') into a second currency for any of the
foregoing reasons, and such conversion results in payment of Yen ('Y') at the
designated place of payment in an amount greater than the amount owing; the
Lender shall immediately remit the excess to the payor.
21. The payment and performance of this Guaranty Agreement is secured by,
and entitled to the benefits of, the Pledge Agreement.
IN WITNESS WHEREOF, this Guaranty Agreement has been executed and delivered
to the Lender by the undersigned Guarantor as of the date first above written.
WITNESS: XXXXXX XXXXXX INTERNATIONAL
INC.
[SIGNATURE ILLEGIBLE] By: X.X. Xxxxxxxx
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Title: EVP & CFO
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