Exhibit 10.201
LIMITED GUARANTEE
LIMITED GUARANTEE dated as of June 1, 1999 by LITCHFIELD FINANCIAL
CORPORATION, a Massachusetts corporation (the "Guarantor"), in favor of
BankBoston, N.A., a national banking association with an address at 15
Westminster Street, Providence, Rhode Island ("BankBoston"), as a Noteholder
under the Indenture hereinafter referred to.
WHEREAS, Litchfield Hypothecation Corp. 1998-A, a Delaware
corporation (the "Issuer") and a wholly-owned subsidiary of the Guarantor, is
a party to an Indenture of Trust dated as of June 1, 1998, as amended by
Amendment No. 1 thereto dated as of September 1, 1998, Amendment No. 2
thereto dated as of November 1, 1998, Amendment No. 3 thereto dated as of
March 1, 1999 and Amendment No. 4 thereto dated as of June 1, 1999 (the
"Indenture") (capitalized terms used but not defined herein shall have the
meanings attributed thereto in the Indenture or in Appendix A thereto) with
The Chase Manhattan Bank (the "Trustee") pursuant to which on the date
hereof the Issuer has issued (i) that certain Series A Note in the original
principal amount of $4,850,190.71 and (ii) that certain Series C Note in the
original principal amount of $7,349,809.29 (collectively, the "Guaranteed
Notes"); and
WHEREAS, the Issuer, the Guarantor and BankBoston are parties to
a Note Purchase Agreement, dated the date hereof, pursuant to which and
subject to the terms and conditions contained therein, BankBoston shall
purchase the Guaranteed Notes from the Issuer; and
WHEREAS, it is a condition to the purchase by BankBoston of the
Guaranteed Notes that the Guarantor issue a guarantee in the form hereof of
certain of the obligations of the Issuer under the Guaranteed Notes.
NOW, THEREFORE, in consideration of the premises and in order to
induce BankBoston to purchase the Guaranteed Notes, the Guarantor hereby
agrees as follows:
Section 1. Guarantee. The Guarantor hereby irrevocably and
unconditionally guarantees the punctual payment when due, whether at stated
maturity, after maturity, by acceleration or otherwise, of principal of and
interest on the Guaranteed Notes (the "Guaranteed Obligations") in an
aggregate amount not to exceed $610,000.00 (the "Guaranteed Amount"). The
Guarantor hereby agrees that it shall make the payment of a Guaranteed
Obligation upon receipt of written demand therefor from BankBoston (a "Demand
Notice") which Demand Notice shall specify that an Event of Default has
occurred and is continuing under either or both of Sections 7.1(a) and 7.1(b)
of the Indenture due to the failure of the Issuer to make the applicable
payment of principal and/or interest due and owing to BankBoston under the
Guaranteed Notes and the Indenture. The obligation of the Guarantor
hereunder shall in no event exceed the Guaranteed Amount. The Guaranteed
Amount shall be reduced by (i) the amount of any payments made by Guarantor
hereunder or (ii) the amount of any unreimbursed Servicer Advances pursuant
to the Indenture.
Notwithstanding the limitation contained in the preceding sentence,
the Guarantor shall also pay all costs and expenses, including attorneys'
fees, costs relating to all costs and expenses arising out of or with respect
to the validity, enforceability, collection, defense, administration or
preservation of this Guarantee.
GUARANTOR ACKNOWLEDGES AND AGREES THAT ANY REPURCHASE OF THE
HYPOTHECATION LOANS BY THE GUARANTOR PURSUANT TO THE TERMS OF THE INDENTURE
OR ANY OTHER DOCUMENT PROVIDING GUARANTOR WITH SUCH OPTION OR OBLIGATION OR
THE PAYMENT OR PERFORMANCE BY GUARANTOR OF ANY OTHER OBLIGATION OF ISSUER
UNDER THE INDENTURE OR THE GUARANTEED NOTES SHALL NOT REDUCE THE OBLIGATIONS
OF GUARANTOR TO BANKBOSTON UNDER THIS GUARANTEE AND BANKBOSTON'S CONSENT TO
SUCH REPURCHASE SHALL NOT CONSTITUTE A WAIVER OF BANKBOSTON'S RIGHTS
HEREUNDER.
Section 2. Waiver. The Guarantor hereby absolutely,
unconditionally and irrevocably waives, to the fullest extent permitted by
law, (i) promptness, diligence, notice of acceptance and any other notice
with respect to this Guarantee,(ii) any requirement that BankBoston protect,
secure, perfect or insure any security interest or lien or any property
subject thereto or exhaust any right or take any action against the Issuer or
any other person or any collateral, (iii) any and all right to assert any
defense, set-off, counterclaim or cross-claim of any nature whatsoever with
respect to this Guarantee, the obligations of the Guarantor hereunder or the
obligations of any other person or party (including, without limitation, the
Issuer) relating to this Guarantee or the obligations of the Guarantor
hereunder or otherwise with respect to the Guaranteed Obligations in any
action or proceeding brought by BankBoston to collect the Guaranteed
Obligations or any portion thereof or to enforce the obligations of the
Guarantor under this Guarantee, and (iv) any other action, event or
precondition to the enforcement of this Guarantee or the performance by the
Guarantor of the obligations hereunder.
Section 3. Guarantee Absolute. (a) The Guarantor guarantees that,
to the fullest extent permitted by law, the Guaranteed Obligations will be
paid or performed strictly in accordance with their terms, regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of BankBoston with respect thereto.
(b) No invalidity, irregularity, voidability, voidness or
unenforceability of the Indenture or the Guaranteed Notes or of all or any
part of the Guaranteed Obligations or of any security therefor, shall affect,
impair or be a defense to this Guarantee.
(c) The liability of the Guarantor under this Guarantee shall
be absolute and unconditional irrespective of:
(i) any change in the manner, place or terms of payment or performance,
and/or any change or extension of the time of payment or performance of,
renewal or alteration of, any Guaranteed Obligation, any security
therefor, or any liability incurred directly or indirectly in respect
thereof, or any other amendment or waiver of or any consent to departure
from the Indenture or the Guaranteed Notes, including any increase in
the Guaranteed Obligations resulting from the extension of additional
credit to the Issuer;
(ii) any sale, exchange, release, surrender, realization upon any property by
whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, all or any of the Guaranteed Obligations, and/or any offset
thereagainst, or failure to perfect, or continue the perfection of, any
lien in any such property, or delay in the perfection of any such lien,
or any amendment or waiver of or consent to departure from any other
guarantee for all or any of the Guaranteed Obligations;
(iii) any exercise or failure to exercise any rights against the
Issuer or others (including the Guarantor);
(iv) any settlement or compromise of any Guaranteed Obligation, any security
therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and any
subordination of the payment of all or any part thereof to the payment
of any Guaranteed Obligations (whether due or not) of the Issuer to
creditors of the Issuer other than the Guarantor;
(v) any manner of application of any collateral, or proceeds
thereof, to all or any of the Guaranteed Obligations, or any manner of
sale or other disposition of any collateral for all or any of the
Guaranteed Obligations or any other assets of the Issuer or any of its
subsidiaries; or
(vi) any change, restructuring or termination of the existence of the Issuer.
(d) BankBoston may at any time and from time to time (whether
or not after revocation or termination of this Guarantee) without the consent
of, or notice (except as shall be required by applicable statute and cannot
be waived) to, the Guarantor, and without incurring responsibility to the
Guarantor or impairing or releasing the obligations of the Guarantor
hereunder, apply any sums by whomsoever paid or howsoever realized to any
Guaranteed Obligation regardless of what Guaranteed Obligations remain unpaid.
(e) This Guarantee shall continue to be effective or be
reinstated, as the case may be, if claim is ever made upon BankBoston for
repayment or recovery of any amount or amounts received by BankBoston in
payment or on account of any of the Guaranteed Obligations and BankBoston
repays all or part of said amount by reason of any judgment, decree or order
of any court or administrative body having jurisdiction over BankBoston, or
any settlement or compromise of any such claim effected by BankBoston with
any such claimant (including the Issuer), then and in such event the
Guarantor agrees that any such judgment, decree, order, settlement or
compromise shall be binding upon the Guarantor, notwithstanding any
revocation hereof or the cancellation of the Guaranteed Notes, and the
Guarantor shall be and remain liable to BankBoston hereunder for the amount
so repaid or recovered to the same extent as if such amount had never
originally been received by BankBoston.
Section 4. Continuing Guarantee. This Guarantee is a continuing
one and shall (i) remain in full force and effect until the indefeasible
payment and satisfaction in full of the Guaranteed Obligations, (ii) be
binding upon the Guarantor, its successors and assigns, and (iii) inure to
the benefit of, and be enforceable
by, BankBoston and its successors, transferees and assigns. All obligations
to which this Guarantee applies or may apply under the terms hereof shall be
conclusively presumed to have been created in reliance hereon.
Section 5. Representations, Warranties and Covenants. The
Guarantor hereby represents, warrants and covenants to and with BankBoston
that:
(a) The Guarantor has the corporate power to execute and deliver
this Guarantee and to incur
and perform its obligations hereunder;
(b) The Guarantor has duly taken all necessary corporate action to
authorize the execution,
delivery and performance of this Guarantee and to incur and perform its
obligations hereunder;
(c) No consent, approval, authorization or other action by, and no
notice to or of, or declaration or filing with, any governmental or other
public body, or any other person, is required for the due authorization,
execution, delivery and performance by the Guarantor of this Guarantee or the
consummation of the transactions contemplated hereby; and
(d) The Guarantor shall provide to BankBoston (i) within 60
days of the end of each fiscal quarter, the report on form 10-Q of the
Guarantor and (ii) within 135 days of the end of each fiscal year of the
Guarantor, the report on form 10-K of the Guarantor.
Section 6. Terms. (a) The words "include," "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
(b) All references herein to Sections and subsections shall be
deemed to be references to Sections and subsections of this Guarantee unless
the context shall otherwise require.
Section 7. Amendments and Modification. No provision hereof shall
be modified, altered or limited except by written instrument expressly
referring to this Guarantee and to such provision, and executed by the party
to be charged.
Section 8. Waiver of Subrogation Rights. Guarantor hereby waives
until the Guaranteed Obligations are paid in full any right of indemnity,
reimbursement, contribution, or subrogation arising as a result of payment by
Guarantor hereunder, and will not prove any claim in competition with
BankBoston in respect of any payment hereunder in bankruptcy or insolvency
proceedings of any nature. Guarantor will not claim any set-off or
counterclaim against Issuer in respect of any liability of Guarantor to
Issuer. Guarantor waives any benefit of and any right to participate in any
collateral which may be held by BankBoston .
Section 9. Statute of Limitations. Any acknowledgment or new
promise, whether by payment of principal or interest or otherwise and whether
by the Issuer or others (including the Guarantor), with respect to any of the
Guaranteed Obligations shall, if the statute of limitations in favor of the
Guarantor against BankBoston shall have commenced to run, toll the running of
such statute of limitations and, if the period of such statute of limitations
shall have expired, prevent the operation of such statute of limitations.
Section 10. Rights and Remedies Not Waived. No act, omission or
delay by BankBoston shall constitute a waiver of its rights and remedies
hereunder or otherwise. No single or partial waiver by BankBoston of any
default hereunder or right or remedy which it may have shall operate as a
waiver of any other default, right or remedy or of the same default, right or
remedy on a future occasion.
Section 11. Admissibility of Guarantee. The Guarantor agrees that
any copy of this Guarantee signed by the Guarantor and transmitted by
telecopier for delivery to BankBoston shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether or not
the original is in existence.
Section 12. Notices. All notices, requests and demands to or upon
BankBoston or the Guarantor under this Agreement shall be in writing and
given as provided in the Indenture (with respect to the Guarantor, to the
address of the Issuer as set forth in the Indenture and with respect to
BankBoston, at its address set forth above).
Section 13. Counterparts. This Guarantee may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an
original and all of which shall together constitute one and the same
agreement.
Section 14. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL; ETC.
(a) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTEE MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF
AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AND, BY EXECUTION AND DELIVERY
OF THIS
GUARANTEE, THE GUARANTOR HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS. THE GUARANTOR HEREBY IRREVOCABLY WAIVES, IN CONNECTION
WITH ANY SUCH ACTION OR PROCEEDING, (i) TRIAL BY JURY, (ii) TO THE EXTENT IT
MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH
ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS AND (iii) THE RIGHT TO
INTERPOSE ANY SET-OFF, COUNTERCLAIM OR CROSS-CLAIM (UNLESS SUCH SET-OFF,
COUNTERCLAIM OR CROSS-CLAIM COULD NOT, BY REASON OF ANY APPLICABLE FEDERAL OR
STATE PROCEDURAL LAWS, BE INTERPOSED, PLEADED OR ALLEGED IN ANY OTHER ACTION).
GUARANTOR ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS
GUARANTEE IS A PART IS A COMMERCIAL TRANSACTION, AND HEREBY VOLUNTARILY
WAIVES GUARANTOR'S RIGHTS TO NOTICE AND HEARING UNDER ANY APPLICABLE
STATE OR FEDERAL LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH BANKBOSTON
MAY DESIRE TO USE.
(b) The Guarantor irrevocably consents to the service of
process of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by certified mail, postage prepaid, to the
Guarantor at its address determined pursuant to Section 12 hereof.
(c) Nothing herein shall affect the right of BankBoston to
serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Guarantor in any other
jurisdiction.
(d) The Guarantor hereby waives presentment, notice of dishonor
and protests of all instruments included in or evidencing any of the
Guaranteed Obligations, and any and all other notices and demands whatsoever
(except as expressly provided herein).
Section 15. GOVERNING LAW. THIS GUARANTEE AND THE GUARANTEED
OBLIGATIONS SHALL BE GOVERNED IN ALL RESPECTS BY THE LAWS OF THE STATE OF NEW
YORK APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED IN SUCH STATE,
WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
Section 16. Captions; Separability. (a) The captions of the
Sections and subsections of this Guarantee have been inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision of this Guarantee.
(b) If any term of this Guarantee shall be held to be invalid,
illegal or unenforceable, the validity of all other terms hereof shall in no
way be affected thereby.
Section 17. Acknowledgment of Receipt. The Guarantor acknowledges
receipt of a copy of this Guarantee.
Section 18. This Guarantee shall inure to the benefit of and be
enforceable by BankBoston , its successors, transferees and assigns, and it
shall be binding upon Guarantor and the successors and assigns of Guarantor.
IN WITNESS WHEREOF, the Guarantor has duly executed or caused this
Guarantee to be duly executed as of the date first above set forth.
LITCHFIELD FINANCIAL CORPORATION
By: /s/ Heather A. Sica
Title: Executive Vice President