Exhibit 10.44
---------------------------------
Execution Version
---------------------------------
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this "Guaranty Agreement"), dated as of October
31, 2005, is made by EACH OF THE UNDERSIGNED AND EACH OTHER PERSON WHO SHALL
BECOME A PARTY HERETO BY EXECUTION OF A GUARANTY JOINDER AGREEMENT (each a
"Guarantor" and collectively the "Guarantors") to BANK OF AMERICA, N.A., a
national banking association organized and existing under the laws of the United
States, as administrative agent (in such capacity, the "Administrative Agent")
for each of the lenders (the "Lenders" now or hereafter party to the Credit
Agreement defined below (collectively with the Administrative Agent, and certain
other Persons parties to Related Credit Arrangements as more particularly
described in Section 19 hereof, the "Secured Parties"). All capitalized terms
used but not otherwise defined herein shall have the meanings ascribed to such
terms in the Credit Agreement.
W I T N E S S E T H:
-------------------
WHEREAS, the Secured Parties have agreed to provide to Main Street
Restaurant Group, Inc. (the "Borrower") certain credit facilities, including a
term loan facility and revolving credit facility with a letter of credit
sublimit pursuant to the terms of that certain Credit Agreement dated as of
October 31, 2005, among the Borrower, the Administrative Agent and the Lenders
(as from time to time amended, revised, modified, supplemented or amended and
restated, the "Credit Agreement"); and
WHEREAS, each Guarantor is, directly or indirectly, a Subsidiary of the
Borrower and will materially benefit from the Loans made and to be made, and the
Letters of Credit issued and to be issued, under the Credit Agreement; and
WHEREAS, each Guarantor is required to enter into this Guaranty Agreement
pursuant to the terms of the Credit Agreement; and
WHEREAS, a material part of the consideration given in connection with and
as an inducement to the execution and delivery of the Credit Agreement by the
Secured Parties was the obligation of the Borrower to cause each Guarantor to
enter into this Guaranty Agreement, and the Secured Parties are unwilling to
extend and maintain the credit facilities provided under the Loan Documents
unless the Guarantors enter into this Guaranty Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto agree as follows:
1. Guaranty. Each Guarantor hereby jointly and severally,
unconditionally, absolutely, continually and irrevocably guarantees to the
Administrative Agent for the benefit of the Secured Parties the payment and
performance in full of the Guaranteed Liabilities (as defined below). For all
purposes of this Guaranty Agreement, "Guaranteed Liabilities" means: (a) the
Borrower's prompt payment in full, when due or declared due and at all such
times, of all Obligations and all other amounts pursuant to the terms of the
Credit Agreement, the Notes, and all other Loan Documents heretofore, now or at
any time or times hereafter owing, arising, due or payable from the Borrower to
any one or more of the Secured Parties, including principal, interest, premiums
and fees (including, but not limited to, loan fees and reasonable fees, charges
and disbursements of counsel ("Attorney Costs"); (b) the Borrower's prompt, full
1
and faithful performance, observance and discharge of each and every agreement,
undertaking, covenant and provision to be performed, observed or discharged by
the Borrower under the Credit Agreement, the Notes and all other Loan Documents;
and (c) the prompt payment in full by each Loan Party, when due or declared due
and at all such times, of obligations and liabilities now or hereafter arising
under Related Credit Arrangements. The Guarantors' obligations to the Secured
Parties under this Guaranty Agreement are hereinafter collectively referred to
as the "Guarantors' Obligations" and, with respect to each Guarantor
individually, the "Guarantor's Obligations". Notwithstanding the foregoing, the
liability of each Guarantor individually with respect to its Guarantor's
Obligations shall be limited to an aggregate amount equal to the largest amount
that would not render its obligations hereunder subject to avoidance under
Section 548 of Title 11 of the United States Code (the "Bankruptcy Code"), any
successor or replacement statute or provision, or any comparable provisions of
any applicable state law.
Each Guarantor agrees that it is jointly and severally, directly and
primarily liable (subject to the limitation in the immediately preceding
sentence) for the Guaranteed Liabilities.
The Guarantors' Obligations are secured by various Security Instruments
referred to in the Credit Agreement, including without limitation the Security
Agreement (and any Security Joinder Agreement), the Mortgages and the
Assignments of Lease.
2. Payment. If the Borrower shall default in payment or performance of
any of the Guaranteed Liabilities, whether principal, interest, premium, fee
(including, but not limited to, loan fees and Attorney Costs), or otherwise,
when and as the same shall become due, and after expiration of any applicable
grace period, whether according to the terms of the Credit Agreement, by
acceleration, or otherwise, or upon the occurrence and during the continuance of
any Event of Default under the Credit Agreement, then any or all of the
Guarantors will, upon demand thereof by the Administrative Agent, fully pay to
the Administrative Agent, for the benefit of the Secured Parties, subject to any
restriction on each Guarantor's Obligations set forth in Section 1 hereof, an
amount equal to all the Guaranteed Liabilities then due and owing.
3. Absolute Rights and Obligations. This is a guaranty of payment and not
of collection. The Guarantors' Obligations under this Guaranty Agreement shall
be joint and several, absolute and unconditional irrespective of, and each
Guarantor hereby expressly waives, to the extent permitted by law, any defense
to its obligations under this Guaranty Agreement and all Security Instruments to
which it is a party by reason of:
(a) any lack of legality, validity or enforceability of the Credit
Agreement, of any of the Notes, of any other Loan Document, or of any other
agreement or instrument creating, providing security for, or otherwise
relating to any of the Guarantors' Obligations, any of the Guaranteed
Liabilities, or any other guaranty of any of the Guaranteed Liabilities
(the Loan Documents and all such other agreements and instruments being
collectively referred to as the "Related Agreements");
(b) any action taken under any of the Related Agreements, any
exercise of any right or power therein conferred, any failure or omission
to enforce any right conferred thereby, or any waiver of any covenant or
condition therein provided;
2
(c) any acceleration of the maturity of any of the Guaranteed
Liabilities, of the Guarantor's Obligations of any other Guarantor, or of
any other obligations or liabilities of any Person under any of the Related
Agreements;
(d) any release, exchange, non-perfection, lapse in perfection,
disposal, deterioration in value, or impairment of any security for any of
the Guaranteed Liabilities, for any of the Guarantor's Obligations of any
Guarantor, or for any other obligations or liabilities of any Person under
any of the Related Agreements;
(e) any dissolution of the Borrower or any Guarantor or any other
party to a Related Agreement, or the combination or consolidation of the
Borrower or any Guarantor or any other party to a Related Agreement into or
with another entity or any transfer or disposition of any assets of the
Borrower or any Guarantor or any other party to a Related Agreement;
(f) any extension (including without limitation extensions of time
for payment), renewal, amendment, restructuring or restatement of, any
acceptance of late or partial payments under, or any change in the amount
of any borrowings or any credit facilities available under, the Credit
Agreement, any of the Notes or any other Loan Document or any other Related
Agreement, in whole or in part;
(g) the existence, addition, modification, termination, reduction or
impairment of value, or release of any other guaranty (or security
therefor) of the Guaranteed Liabilities (including without limitation the
Guarantor's Obligations of any other Guarantor and obligations arising
under any other Guaranty now or hereafter in effect);
(h) any waiver of, forbearance or indulgence under, or other consent
to any change in or departure from any term or provision contained in the
Credit Agreement, any other Loan Document or any other Related Agreement,
including without limitation any term pertaining to the payment or
performance of any of the Guaranteed Liabilities, any of the Guarantor's
Obligations of any other Guarantor, or any of the obligations or
liabilities of any party to any other Related Agreement;
(i) any other circumstance whatsoever (with or without notice to or
knowledge of any Guarantor) which may or might in any manner or to any
extent vary the risks of such Guarantor, or might otherwise constitute a
legal or equitable defense available to, or discharge of, a surety or a
guarantor, including without limitation any right to require or claim that
resort be had to the Borrower or any other Loan Party or to any collateral
in respect of the Guaranteed Liabilities or Guarantors' Obligations.
It is the express purpose and intent of the parties hereto that this Guaranty
Agreement and the Guarantors' Obligations hereunder and under each Guaranty
Joinder Agreement shall be absolute and unconditional under any and all
circumstances and shall not be discharged except by payment as herein provided.
Each Guarantor understands and acknowledges that if the Administrative Agent
forecloses judicially or nonjudicially against any real property security for
the Borrowers' Liabilities, that foreclosure could impair or destroy any ability
that each Guarantor may have to seek reimbursement, contribution or
3
indemnification from the Borrower or others based on any right such Guarantor
may have of subrogation, reimbursement, contribution or indemnification for any
amounts paid by such Guarantor under this Guaranty Agreement. Each Guarantor
further understands and acknowledges that in the absence of this Section 3, such
potential impairment or destruction of such Guarantor's rights, if any, may
entitle such Guarantor to assert a defense to this Guaranty Agreement based on
Section 580d of the California Code of Civil Procedure as interpreted in Union
Bank x. Xxxxxxx, 265 Cal.App.2d 40 (1968). By executing this Guaranty Agreement,
each Guarantor freely, irrevocably and unconditionally: (i) waives and
relinquishes that defense and agrees that such Guarantor will be fully liable
under this Guaranty Agreement even though the Administrative Agent may foreclose
judicially or nonjudicially against any real property security for the
Guaranteed Liabilities; (ii) agrees that such Guarantor will not assert that
defense in any action or proceeding which any Secured Party may commence to
enforce this Guaranty Agreement; (iii) acknowledges and agrees that the rights
and defenses waived by such Guarantor under this Guaranty Agreement include any
right or defense that such Guarantor may have or be entitled to assert based
upon or arising out of any one or more of Sections 580a, 580b, 580d or 726 of
the California Code of Civil Procedure or Section 2848 of the California Civil
Code; and (iv) acknowledges and agrees that the Secured Parties are relying on
this waiver in extending credit to the Borrower, and that this waiver is a
material part of the consideration which the Secured Parties are receiving for
such credit extensions. Without limiting the foregoing, each Guarantor hereby
waives all rights and defenses arising out of an election of remedies by any of
the Secured Parties, even though that election of remedies, such as a
nonjudicial foreclosure with respect to the security held by the Administrative
Agent for the Guaranteed Liabilities, has destroyed such Guarantor's rights of
subrogation and reimbursement against the Borrower by the operation of Section
580d of the California Code of Civil Procedure.
Without limiting the generality of the foregoing, to the fullest extent
permitted by law, each Guarantor waives any and all other defenses or benefits
that may be derived from or afforded by applicable law limiting the liability of
or exonerating guarantors or sureties, or which may conflict with the terms of
this Guaranty Agreement, including any rights and defenses available to each
Guarantor by reason of Sections 2787 to 2855, inclusive, of the California Civil
Code and any and all benefits that otherwise might be available to such
Guarantor under California Civil Code Sections 1432, 2809, 2810, 2815, 2819,
2839, 2845, 2849, 2850, 2899 and 3433.
Each Guarantor waives all rights and defenses that such Guarantor may have in
the event that the Guaranteed Liabilities shall be secured by real property.
This means, among other things:
(i) The Secured Parties may collect from such Guarantor without first
foreclosing on any real or personal property collateral pledged by the
Borrower.
(ii) If the Administrative Agent forecloses on any real property
collateral pledged by the Borrower:
(A) The amount of the Guaranteed Liabilities may be reduced only
by the price for which that collateral is sold at the foreclosure
sale, even if the collateral is worth more than the sale price.
4
(B) The Secured Parties may collect from such Guarantor even if
the Administrative Agent, by foreclosing on the real property
collateral, has destroyed any right such Guarantor may have to collect
from the Borrower.
This Section 3 is an unconditional and irrevocable waiver of any rights and
defenses each Guarantor may have in the event that the Guaranteed Liabilities
shall be secured by real property. These rights and defenses include, but are
not limited to, any rights or defenses based upon Section 580a, 580b, 580d, or
726 of the California Code of Civil Procedure.
Each Guarantor also waives any right or defense it may have at law or equity,
including California Code of Civil Procedure Section 580a, to a fair market
value hearing or action to determine a deficiency judgment after a foreclosure.
Each Guarantor also waives and agrees not to assert or take advantage of (a) the
provisions of Arizona Revised Statutes xx.xx. 12-1641 through 12-1646 inclusive,
44-142 and 47-3605, Rule 17(f) of the Arizona Rules of Civil Procedure, and any
similar or analogous other statutory or common laws or procedural rules of any
jurisdiction relevant to each Guarantor, indemnitors, sureties, co-makers or
accommodation parties; (b) any right to require the Administrative Agent or any
Lender to proceed against the Borrower or any other person or entity, to proceed
against or exhaust any security held by the Administrative Agent or any Lender
at any time for the Obligations or to pursue any other remedy in the
Administrative Agent's or any Lender's power before proceeding against any
Guarantor; (c) any defense of any statute of limitations which may be asserted
by the Borrower; (d) any defense that may arise by reason of the incapacity,
lack of authority, death, disability, dissolution or termination of, involvement
in any bankruptcy or reorganization proceeding by, or other similar occurrence
or happening with respect to, the Borrower or any successor in interest to the
Borrower with respect to any of the collateral for the Obligations; (e) any "one
action" or "anti-deficiency" law or any other law which may prevent the
Administrative Agent or any Lender from bringing any action, including a claim
for deficiency, against any Guarantor, before or after the Administrative
Agent's or any Lender's commencement or completion of any foreclosure action,
either judicially or by exercise of a power of sale; (f) any election of
remedies by the Administrative Agent or any Lender which destroys or otherwise
adversely affects any Guarantor's subrogation rights or such Guarantor's right
to proceed against the Borrower for reimbursement, including without limitation,
any loss of rights of any Guarantor may suffer by reason of any law limiting,
qualifying, or discharging the Indebtedness; or (g) any right to receive any
demand or any notice, including any notice of any Event of Default under the
Loan Documents.
As provided below, this Guaranty Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York. The foregoing waivers and
provisions of this Guaranty Agreement as to matters of California law are
included solely out of an abundance of caution, and shall not be construed to
mean that any of the above referenced provisions of California law are in any
way applicable to this Guaranty Agreement or the Guaranteed Liabilities.
No provision or waiver in this Guaranty Agreement shall be construed as limiting
the generality of any other provision or waiver contained in this Guaranty
Agreement.
5
4. Currency and Funds of Payment. All Guarantors' Obligations will be
paid in lawful currency of the United States of America and in immediately
available funds, regardless of any law, regulation or decree now or hereafter in
effect that might in any manner affect the Guaranteed Liabilities, or the rights
of any Secured Party with respect thereto as against the Borrower, or cause or
permit to be invoked any alteration in the time, amount or manner of payment by
the Borrower of any or all of the Guaranteed Liabilities.
5. Events of Default. Without limiting the provisions of Section 2
hereof, in the event that there shall occur and be continuing an Event of
Default, then notwithstanding any collateral or other security or credit support
for the Guaranteed Liabilities, at the Administrative Agent's election and
without notice thereof or demand therefor, the Guarantors' Obligations shall
immediately be and become due and payable.
6. Subordination. Until this Guaranty Agreement is terminated in
accordance with Section 22 hereof, each Guarantor hereby unconditionally
subordinates all present and future debts, liabilities or obligations now or
hereafter owing to such Guarantor (i) of the Borrower, to the payment in full of
the Guaranteed Liabilities, (ii) of every other Guarantor (an "obligated
guarantor"), to the payment in full of the Guarantors' Obligations of such
obligated guarantor, and (iii) of each other Person now or hereafter
constituting a Loan Party, to the payment in full of the obligations of such
Loan Party owing to any Secured Party and arising under the Loan Documents or
the Related Credit Arrangements. All amounts due under such subordinated debts,
liabilities, or obligations shall, upon the occurrence and during the
continuance of an Event of Default, be collected and, upon request by the
Administrative Agent, paid over forthwith to the Administrative Agent for the
benefit of the Secured Parties on account of the Guaranteed Liabilities, the
Guarantors' Obligations, or such other obligations, as applicable, and, after
such request and pending such payment, shall be held by such Guarantor as agent
and bailee of the Secured Parties separate and apart from all other funds,
property and accounts of such Guarantor.
7. Suits. Each Guarantor from time to time shall pay to the
Administrative Agent for the benefit of the Secured Parties, on demand, at the
Administrative Agent's place of business set forth in the Credit Agreement or
such other address as the Administrative Agent shall give notice of to such
Guarantor, the Guarantors' Obligations as they become or are declared due, and
in the event such payment is not made forthwith, the Administrative Agent may
proceed to suit against any one or more or all of the Guarantors. At the
Administrative Agent's election, one or more and successive or concurrent suits
may be brought hereon by the Administrative Agent against any one or more or all
of the Guarantors, whether or not suit has been commenced against the Borrower,
any other Guarantor, or any other Person and whether or not the Secured Parties
have taken or failed to take any other action to collect all or any portion of
the Guaranteed Liabilities or have taken or failed to take any actions against
any collateral securing payment or performance of all or any portion of the
Guaranteed Liabilities, and irrespective of any event, occurrence, or condition
described in Section 3 hereof.
8. Set-Off and Waiver. Each Guarantor waives any right to assert against
any Secured Party as a defense, counterclaim, set-off, recoupment or cross claim
in respect of its Guarantor's Obligations, any defense (legal or equitable) or
other claim which such Guarantor may now or at any time hereafter have against
the Borrower or any or all of the Secured Parties without waiving any additional
6
defenses, set-offs, counterclaims or other claims otherwise available to such
Guarantor. Each Guarantor agrees that each Secured Party shall have a lien for
all the Guarantor's Obligations upon all deposits or deposit accounts, of any
kind, or any interest in any deposits or deposit accounts, now or hereafter
pledged, mortgaged, transferred or assigned to such Secured Party or otherwise
in the possession or control of such Secured Party for any purpose (other than
solely for safekeeping) for the account or benefit of such Guarantor, including
any balance of any deposit account or of any credit of such Guarantor with the
Secured Party, whether now existing or hereafter established, and hereby
authorizes each Secured Party from and after the occurrence of an Event of
Default at any time or times with or without prior notice to apply such balances
or any part thereof to such of the Guarantor's Obligations to the Secured
Parties then due and in such amounts as provided for in the Credit Agreement or
otherwise as they may elect. For the purposes of this Section 8, all remittances
and property shall be deemed to be in the possession of a Secured Party as soon
as the same may be put in transit to it by mail or carrier or by other bailee.
9. Waiver of Notice; Subrogation.
(a) Each Guarantor hereby waives to the extent permitted by law
notice of the following events or occurrences: (i) acceptance of this
Guaranty Agreement; (ii) the Lenders' heretofore, now or from time to time
hereafter making Loans and issuing Letters of Credit and otherwise loaning
monies or giving or extending credit to or for the benefit of the Borrower
or any other Loan Party, or otherwise entering into arrangements with any
Loan Party giving rise to Guaranteed Liabilities, whether pursuant to the
Credit Agreement or the Notes or any other Loan Document or Related
Agreement or any amendments, modifications, or supplements thereto, or
replacements or extensions thereof; (iii) presentment, demand, default,
non-payment, partial payment and protest; and (iv) any other event,
condition, or occurrence described in Section 3 hereof. Each Guarantor
agrees that each Secured Party may heretofore, now or at any time hereafter
do any or all of the foregoing in such manner, upon such terms and at such
times as each Secured Party, in its sole and absolute discretion, deems
advisable, without in any way or respect impairing, affecting, reducing or
releasing such Guarantor from its Guarantor's Obligations, and each
Guarantor hereby consents to each and all of the foregoing events or
occurrences.
(b) Each Guarantor hereby agrees that payment or performance by such
Guarantor of its Guarantor's Obligations under this Guaranty Agreement may
be enforced by the Administrative Agent on behalf of the Secured Parties
upon demand by the Administrative Agent to such Guarantor without the
Administrative Agent being required, such Guarantor expressly waiving to
the extent permitted by law any right it may have to require the
Administrative Agent, to (i) prosecute collection or seek to enforce or
resort to any remedies against the Borrower or any other Guarantor or any
other guarantor of the Guaranteed Liabilities, or (ii) seek to enforce or
resort to any remedies with respect to any security interests, Liens or
encumbrances granted to the Administrative Agent or any Lender or other
party to a Related Agreement by the Borrower, any other Guarantor or any
other Person on account of the Guaranteed Liabilities or any guaranty
thereof, IT BEING EXPRESSLY UNDERSTOOD, ACKNOWLEDGED AND AGREED TO BY SUCH
GUARANTOR THAT DEMAND UNDER THIS GUARANTY AGREEMENT MAY BE MADE BY THE
ADMINISTRATIVE AGENT, AND THE PROVISIONS HEREOF ENFORCED BY THE
ADMINISTRATIVE AGENT, EFFECTIVE AS OF THE FIRST DATE ANY EVENT OF DEFAULT
OCCURS AND IS CONTINUING UNDER THE CREDIT AGREEMENT.
7
(c) Each Guarantor further agrees with respect to this Guaranty
Agreement that it shall have no right of subrogation, reimbursement,
contribution or indemnity, nor any right of recourse to security for the
Guaranteed Liabilities unless and until 93 days immediately following the
Facility Termination Date (as defined below) shall have elapsed without the
filing or commencement, by or against any Loan Party, of any state or
federal action, suit, petition or proceeding seeking any reorganization,
liquidation or other relief or arrangement in respect of creditors of, or
the appointment of a receiver, liquidator, trustee or conservator in
respect to, such Loan Party or its assets. This waiver is expressly
intended to prevent the existence of any claim in respect to such
subrogation, reimbursement, contribution or indemnity by any Guarantor
against the estate of any other Loan Party within the meaning of Section
101 of the Bankruptcy Code, in the event of a subsequent case involving any
other Loan Party. If an amount shall be paid to any Guarantor on account of
such rights at any time prior to termination of this Guaranty Agreement in
accordance with the provisions of Section 22 hereof, such amount shall be
held in trust for the benefit of the Secured Parties and shall forthwith be
paid to the Administrative Agent, for the benefit of the Secured Parties,
to be credited and applied upon the Guarantors' Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement
or otherwise as the Secured Parties may elect. The agreements in this
subsection shall survive repayment of all of the Guarantors' Obligations,
the termination or expiration of this Guaranty Agreement in any manner,
including but not limited to termination in accordance with Section 22
hereof, and occurrence of the Facility Termination Date.
(d) Notwithstanding the provisions of Arizona Revised Statutes ss.
12-1643 or any other statutory or common law or procedural rule, until the
Obligations has been paid in full and the Administrative Agent and each of
the Lenders have no further obligation to make any advance under the Loan
Documents: (a) no Guarantor shall have a right of subrogation or
reimbursement with respect to any of the Obligations, any security for any
portion of the Obligations or any remedy of the Administrative Agent or any
Lender to collect any of the Obligations, regardless of any payment
directly or indirectly made by any Guarantor pursuant to the provisions of
this Guaranty or otherwise; and (b) no Guarantors shall have a right of
contribution against any other guarantor or pledgor; provided, however,
that no Guarantor shall acquire rights of the nature described in this
sentence if and to the extent that the acquisition or ownership of such
rights would cause the Administrative Agent or any Lender to become subject
to a voidable preference period, in any bankruptcy proceeding involving any
Guarantor, the Borrower or any of their affiliates, of greater duration
than would have applied to the Administrative Agent or any Lender in the
absence of such rights. To the extent that the foregoing waiver of the
rights of subrogation, reimbursement or contribution are determined by a
court of competent jurisdiction to be void or voidable for any reason, each
Guarantor agrees that its rights of subrogation and reimbursement against
the Borrower and against any collateral or security will be junior and
8
subordinate to the Administrative Agent's and each Lender's rights against
the Borrower and to the Administrative Agent's and each Lender's right,
title and interest in such collateral or security, and each Guarantor's
right of contribution against any other guarantor or pledgor shall be
junior and subordinate to the Administrative Agent's and each Lender's
rights against such other guarantor or pledgor. Each Guarantor acknowledges
that the Administrative Agent and each Lender do not and shall not make any
representation or warranty of any nature as to the existence, value,
priority or non-impairment of any such rights or any such security, and
waives any and all claims thereto.
10. Effectiveness; Enforceability. This Guaranty Agreement shall be
effective as of the date first above written and shall continue in full force
and effect until termination in accordance with Section 22 hereof. Any claim or
claims that the Secured Parties may at any time hereafter have against a
Guarantor under this Guaranty Agreement may be asserted by the Administrative
Agent on behalf of the Secured Parties by written notice directed to such
Guarantor in accordance with Section 24 hereof.
11. Representations and Warranties. Each Guarantor warrants and represents
to the Administrative Agent, for the benefit of the Secured Parties, that it is
duly authorized to execute and deliver this Guaranty Agreement (or the Guaranty
Joinder Agreement to which it is a party, as applicable), and to perform its
obligations under this Guaranty Agreement, that this Guaranty Agreement (or the
Guaranty Joinder Agreement to which it is a party, as applicable) has been duly
executed and delivered on behalf of such Guarantor by its duly authorized
representatives; that this Guaranty Agreement (and any Guaranty Joinder
Agreement to which such Guarantor is a party) is legal, valid, binding and
enforceable against such Guarantor in accordance with its terms except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles; and that such Guarantor's
execution, delivery and performance of this Guaranty Agreement (and any Guaranty
Joinder Agreement to which such Guarantor is a party) do not violate or
constitute a breach of any of its Organization Documents, any agreement or
instrument to which such Guarantor is a party, or any law, order, regulation,
decree or award of any governmental authority or arbitral body to which it or
its properties or operations is subject.
12. Expenses. Each Guarantor agrees to be jointly and severally liable for
the payment of all reasonable fees and expenses, including Attorney Costs,
incurred by any Secured Party in connection with the enforcement of this
Guaranty Agreement, whether or not suit be brought.
13. Reinstatement. Each Guarantor agrees that this Guaranty Agreement
shall continue to be effective or be reinstated, as the case may be, at any time
payment received by any Secured Party in respect of any Guaranteed Liabilities
is rescinded or must be restored for any reason, or is repaid by any Secured
Party in whole or in part in good faith settlement of any pending or threatened
avoidance claim.
14. Attorney-in-Fact. To the extent permitted by law, each Guarantor
hereby appoints the Administrative Agent, for the benefit of the Secured
9
Parties, as such Guarantor's attorney-in-fact for the purposes of carrying out
the provisions of this Guaranty Agreement and taking any action and executing
any instrument which the Administrative Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment is coupled with an interest
and is irrevocable; provided, that the Administrative Agent shall have and may
exercise rights under this power of attorney only upon the occurrence and during
the continuance of an Event of Default.
15. Reliance. Each Guarantor represents and warrants to the Administrative
Agent, for the benefit of the Secured Parties, that: (a) such Guarantor has
adequate means to obtain on a continuing basis (i) from the Borrower,
information concerning the Loan Parties and the Loan Parties' financial
condition and affairs and (ii) from other reliable sources, such other
information as it deems material in deciding to provide this Guaranty Agreement
and any Guaranty Joinder Agreement ("Other Information"), and has full and
complete access to the Loan Parties' books and records and to such Other
Information; (b) such Guarantor is not relying on any Secured Party or its or
their employees, directors, agents or other representatives or Affiliates, to
provide any such information, now or in the future; (c) such Guarantor has been
furnished with and reviewed the terms of the Credit Agreement and such other
Loan Documents and Related Agreements as it has requested, is executing this
Guaranty Agreement (or the Guaranty Joinder Agreement to which it is a party, as
applicable) freely and deliberately, and understands the obligations and
financial risk undertaken by providing this Guaranty Agreement (and any Guaranty
Joinder Agreement); (d) such Guarantor has relied solely on the Guarantor's own
independent investigation, appraisal and analysis of the Borrower, the
Borrower's financial condition and affairs, the "Other Information", and such
other matters as it deems material in deciding to provide this Guaranty
Agreement (and any Guaranty Joinder Agreement) and is fully aware of the same;
and (e) such Guarantor has not depended or relied on any Secured Party or its or
their employees, directors, agents or other representatives or Affiliates, for
any information whatsoever concerning the Borrower or the Borrower's financial
condition and affairs or any other matters material to such Guarantor's decision
to provide this Guaranty Agreement (and any Guaranty Joinder Agreement), or for
any counseling, guidance, or special consideration or any promise therefor with
respect to such decision. Each Guarantor agrees that no Secured Party has any
duty or responsibility whatsoever, now or in the future, to provide to such
Guarantor any information concerning the Borrower or the Borrower's financial
condition and affairs, or any Other Information, other than as expressly
provided herein, and that, if such Guarantor receives any such information from
any Secured Party or its or their employees, directors, agents or other
representatives or Affiliates, such Guarantor will independently verify the
information and will not rely on any Secured Party or its or their employees,
directors, agents or other representatives or Affiliates, with respect to such
information.
16. Rules of Interpretation. The rules of interpretation contained in
Sections 1.02 and 1.05 of the Credit Agreement shall be applicable to this
Guaranty Agreement and each Guaranty Joinder Agreement and are hereby
incorporated by reference. All representations and warranties contained herein
shall survive the delivery of documents and any extension of credit referred to
herein or guaranteed hereby.
17. Entire Agreement. This Guaranty Agreement and each Guaranty Joinder
Agreement, together with the Credit Agreement and other Loan Documents,
constitutes and expresses the entire understanding between the parties hereto
with respect to the subject matter hereof, and supersedes all prior
negotiations, agreements, understandings, inducements, commitments or
conditions, express or implied, oral or written, except as herein contained. The
10
express terms hereof control and supersede any course of performance or usage of
the trade inconsistent with any of the terms hereof. Except as provided in
Section 22, neither this Guaranty Agreement nor any Guaranty Joinder Agreement
nor any portion or provision hereof or thereof may be changed, altered,
modified, supplemented, discharged, canceled, terminated, or amended orally or
in any manner other than as provided in the Credit Agreement.
18. Binding Agreement; Assignment. This Guaranty Agreement, each Guaranty
Joinder Agreement and the terms, covenants and conditions hereof and thereof,
shall be binding upon and inure to the benefit of the parties hereto and
thereto, and to their respective heirs, legal representatives, successors and
assigns; provided, however, that no Guarantor shall be permitted to assign any
of its rights, powers, duties or obligations under this Guaranty Agreement, any
Guaranty Joinder Agreement or any other interest herein or therein without the
prior written consent of the Administrative Agent. Without limiting the
generality of the foregoing sentence of this Section 18, any Lender may assign
to one or more Persons, or grant to one or more Persons participations in or to,
all or any part of its rights and obligations under the Credit Agreement (to the
extent permitted by the Credit Agreement); and to the extent of any such
assignment or participation such other Person shall, to the fullest extent
permitted by law, thereupon become vested with all the benefits in respect
thereof granted to such Lender herein or otherwise, subject however, to the
provisions of the Credit Agreement, including Article IX thereof (concerning the
Administrative Agent) and Section 10.07 thereof concerning assignments and
participations. All references herein to the Administrative Agent shall include
any successor thereof.
19. Related Credit Arrangements. All obligations of any Loan Party under
Related Credit Arrangements to which any Lender or its Affiliates are a party
shall be deemed to be Guaranteed Liabilities, and each Lender or Affiliate of a
Lender party to any such Related Credit Arrangement shall be deemed to be a
Secured Party hereunder with respect to such Guaranteed Liabilities; provided,
however, that such obligations shall cease to be Guaranteed Liabilities at such
time, prior to the Facility Termination Date, as such Person (or Affiliate of
such Person) shall cease to be a "Lender" under the Credit Agreement.
No Person who obtains the benefit of this Guaranty Agreement by virtue of
the provisions of this Section shall have, prior to the Facility Termination
Date, any right to notice of any action or to consent to, direct or object to
any action hereunder or under any other Loan Document or otherwise in respect of
the Guarantors' Obligations (including the release or modification of any
Guarantors' Obligations or security therefor) other than in its capacity as a
Lender and only to the extent expressly provided in the Loan Documents. Each
Secured Party not a party to the Credit Agreement who obtains the benefit of
this Guaranty Agreement by virtue of the provisions of this Section shall be
deemed to have acknowledged and accepted the appointment of the Administrative
Agent pursuant to the terms of the Credit Agreement, and that with respect to
the actions and omissions of the Administrative Agent hereunder or otherwise
relating hereto that do or may affect such Secured Party, the Administrative
Agent and each of its Related Parties shall be entitled to all the rights,
benefits and immunities conferred under Article IX of the Credit Agreement.
11
20. Severability. The provisions of this Guaranty Agreement are
independent of and separable from each other. If any provision hereof shall for
any reason be held invalid or unenforceable, such invalidity or unenforceability
shall not affect the validity or enforceability of any other provision hereof,
but this Guaranty Agreement shall be construed as if such invalid or
unenforceable provision had never been contained herein.
21. Counterparts. This Guaranty Agreement may be executed in any number of
counterparts each of which when so executed and delivered shall be deemed an
original, and it shall not be necessary in making proof of this Guaranty
Agreement to produce or account for more than one such counterpart executed by
the Guarantors against whom enforcement is sought. Without limiting the
foregoing provisions of this Section 21, the provisions of Section 10.02(b) of
the Credit Agreement shall be applicable to this Guaranty Agreement.
22. Termination. Subject to reinstatement pursuant to Section 13 hereof,
this Guaranty Agreement and each Guaranty Joinder Agreement, and all of the
Guarantors' Obligations hereunder (excluding those Guarantors' obligations
relating to Guaranteed Liabilities that expressly survive such termination)
shall terminate on the Facility Termination Date.
23. Remedies Cumulative; Late Payments. All remedies hereunder are
cumulative and are not exclusive of any other rights and remedies of the
Administrative Agent or any other Secured Party provided by law or under the
Credit Agreement, the other Loan Documents or other applicable agreements or
instruments. The making of the Loans and other credit extensions pursuant to the
Credit Agreement and other Related Agreements shall be conclusively presumed to
have been made or extended, respectively, in reliance upon each Guarantor's
guaranty of the Guaranteed Liabilities pursuant to the terms hereof. Any amounts
not paid when due under this Guaranty Agreement shall bear interest at the
Default Rate.
24. Notices. Any notice required or permitted hereunder or under any
Guaranty Joinder Agreement shall be given, (a) with respect to each Guarantor,
at the address of the Borrower indicated in Schedule 10.02 of the Credit
Agreement and (b) with respect to the Administrative Agent or any other Secured
Party, at the Administrative Agent's address indicated in Schedule 10.02 of the
Credit Agreement. All such addresses may be modified, and all such notices shall
be given and shall be effective, as provided in Section 10.02 of the Credit
Agreement for the giving and effectiveness of notices and modifications of
addresses thereunder.
25. Joinder. Each Person who shall at any time execute and deliver to the
Administrative Agent a Guaranty Joinder Agreement substantially in the form
attached as Exhibit A hereto shall thereupon irrevocably, absolutely and
unconditionally become a party hereto and obligated hereunder as a Guarantor,
and all references herein and in the other Loan Documents to the Guarantors or
to the parties to this Guaranty Agreement shall be deemed to include such Person
as a Guarantor hereunder.
12
26. Governing Law; Venue; Waiver of Jury Trial.
(a) THIS GUARANTY AGREEMENT AND EACH GUARANTY JOINDER AGREEMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN
SUCH STATE.
(b) EACH GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND
CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS GUARANTY AGREEMENT OR ANY GUARANTY JOINDER AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN MAY BE INSTITUTED IN ANY STATE
OR FEDERAL COURT SITTING IN THE XXXXXX XX XXX XXXX, XXXXX XX XXX XXXX,
XXXXXX XXXXXX OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS
GUARANTY AGREEMENT OR A GUARANTY JOINDER AGREEMENT, SUCH GUARANTOR
EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE IN, OR TO THE EXERCISE OF JURISDICTION OVER IT AND ITS
PROPERTY BY, ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND
EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO
THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.
(c) EACH GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY
PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL
PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING OR BY ANY OTHER METHOD OF
SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF
NEW YORK.
(d) NOTHING CONTAINED IN SUBSECTIONS (b) or (c) HEREOF SHALL PRECLUDE
THE ADMINISTRATIVE AGENT FROM BRINGING ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS GUARANTY AGREEMENT OR ANY GUARANTY
JOINDER AGREEMENT OR ANY OTHER LOAN DOCUMENT IN THE COURTS OF ANY
JURISDICTION WHERE ANY GUARANTOR OR ANY OF SUCH GUARANTOR'S PROPERTY OR
ASSETS MAY BE FOUND OR LOCATED. TO THE EXTENT PERMITTED BY THE APPLICABLE
LAWS OF ANY SUCH JURISDICTION, EACH GUARANTOR HEREBY IRREVOCABLY SUBMITS TO
THE JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY
SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION
OVER IT AND ITS PROPERTY BY ANY SUCH OTHER COURT OR COURTS WHICH NOW OR
HEREAFTER MAY BE AVAILABLE UNDER APPLICABLE LAW.
13
(e) IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR
REMEDIES UNDER OR RELATED TO THIS GUARANTY AGREEMENT OR ANY GUARANTY
JOINDER AGREEMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH,
EACH GUARANTOR AND THE ADMINISTRATIVE AGENT ON BEHALF OF THE SECURED
PARTIES HEREBY AGREE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY
SUCH ACTION, SUIT OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY AND HEREBY IRREVOCABLY WAIVE, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT ANY SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY
SUCH ACTION, SUIT OR PROCEEDING.
(f) EACH GUARANTOR HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE
THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE TERMS
HEREOF IS AN INCONVENIENT FORUM.
[Signature page follows.]
14
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Guaranty Agreement as of the day and year first written above.
GUARANTORS:
CORNERSTONE PRODUCTIONS, INC.
MAIN ST. MIDWEST, INC.
MAIN ST. CALIFORNIA, INC.
BAMBOO CLUB, INC.
REDFISH CLEVELAND, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Officer
By: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Executive Vice President and Assistant
Secretary
REDFISH AMERICA, L.L.C.
By: Main Street Restaurant Group, Inc.,
It's Manager
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Officer
By: /s/ Xxxxxxx Xxxxxxxxxx
------------------------------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Executive Vice President and Assistant
Secretary
GUARANTY AGREEMENT
Signature Page
ADMINISTRATIVE AGENT:
BANK OF AMERICA, N.A., as Administrative
Agent
By: /s/ Xxxx X. Xxxxxxx
--------------------------------
Name: Xxxx X. Xxxxxxx
------------------------------
Title: Assistant Vice President
------------------------------
GUARANTY AGREEMENT
Signature Page
