Guarantee, dated as of January 28, 1998 by and between Sun Coast
Industries, Inc., a Delaware corporation (the "Company") and Fremont Partners,
L.P., a Delaware limited partnership ("Guarantor").
WHEREAS, each of Xxxx Group, Inc., a Delaware corporation ("Parent"),
and Saffron Acquisition Corp., a Delaware corporation (the "Purchaser"), is a
direct or indirect, subsidiary of Guarantor; and
WHEREAS, the Company, Parent, and the Purchaser have entered into an
Agreement and Plan of Merger (the "Merger Agreement") of even date herewith; and
WHEREAS, upon the terms and subject to the conditions set forth in the
Merger Agreement, the Purchaser will make a cash tender offer (the "1 Offer")
to acquire all shares of the issued and outstanding common stock, $.01 par
value, of the Company (the "1 Company Common Stock"), including the associated
Common Stock Purchase Rights issued pursuant to the Rights Agreement dated as of
December 5, 1995, between the Company and the American Stock Transfer and Trust
Company, for $10.75 per share of Company Common Stock or such higher price as
may be paid in the Offer, net to the seller in cash; and
WHEREAS, as an inducement to the Company to enter into the Merger
Agreement, the Guarantor has agreed to enter into this agreement.
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Company and Guarantor hereby agree as follows:
1. Guarantor hereby unconditionally and irrevocably guarantees, as
primary obligor and not merely as surety, for the benefit of the Company the
performance of all obligations of Parent or the Purchaser pursuant to the Merger
2. Guarantor covenants that this Guarantee will not be discharged
except by complete performance of the obligations contained in this Guarantee.
xxxxx shall not be affected by, and shall remain in full force and effect
notwithstanding, any bankruptcy, insolvency, liquidation, or reorganization of
Parent or the Purchaser or Guarantor.
3. Guarantor agrees to pay, on demand, and to save the Company
harmless against liability for, any and all costs and expenses (including
reasonable fees and disbursements of counsel) incurred or expended by the
Company in connection with the enforcement of or preservation of any rights
under this Guarantee.
4. Guarantor hereby represents, warrants and covenants to the
Company as follows:
a. Guarantor is a limited partnership duly organized and validly
existing under the laws of the State of Delaware. Guarantor has the necessary
power and authority to own and operate its properties and assets and to carry on
its business as currently conducted.
b. Guarantor has all requisite legal power and authority to enter
into this Guarantee. The Guarantor has all requisite legal power and authority
to carry out and perform its obligations under the terms of this Guarantee. The
Guarantee constitutes the valid and binding obligation of Guarantor, enforceable
against it in accordance with its terms, except as enforcement may be limited by
bankruptcy, insolvency, moratorium, reorganization or other laws or equitable
principles relating to or affecting creditors' rights generally.
c. All partnership action on the part of Guarantor and its general
partner and limited partners necessary to authorize the execution, delivery and
performance of this Guarantee has been taken.
d. The Guarantor has funds available to it sufficient to purchase,
or cause the purchase of, the Shares in accordance with the terms of the Merger
Agreement and to pay, or cause to be paid, all amounts due (or which will, as a
result of the transactions contemplated by the Merger Agreement, become due) in
respect of any indebtedness of the Company for money borrowed outstanding as of
the date of the consummation of the Offer (as defined in the Merger Agreement),
a schedule of which is
attached as Section 4.5 of the Disclosure Schedule to the Merger Agreement.
5. This Guarantee shall be deemed to be a contract under the laws of
the State of Delaware and shall for all purposes be governed by and construed in
accordance with the laws of such State.
6. This Guarantee shall terminate and be of no further force or
effect upon the consummation of the purchase by the Purchaser, Parent or any of
their respective affiliates of any Shares pursuant to the Offer.
IN WITNESS WHEREOF, each of the Company and Guarantor have caused this
Guarantee to be executed on its behalf by its officers thereunto duly
authorized, all as on the date first above written.
SUN COAST INDUSTRIES, INC.
By:/s/ Xxxxx X. Xxxxx
FREMONT PARTNERS, L.P.
By: FREMONT ADVISORS, L.L.C., its
By: THE FREMONT GROUP, L.L.C.,
its Managing Member
By: FREMONT INVESTORS, INC., its
By: /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Managing Director