CONTINUING LIMITED NON-RECOURSE AND COLLATERALIZED GUARANTY
THIS LIMITED CONTINUING NON-RECOURSE AND COLLATERALIZED GUARANTY (the
"Guaranty") made by WARNER CHILCOTT (BERMUDA) LIMITED ("Guarantor"), an exempted
company incorporated under the laws of Bermuda, in favor of PNC BANK, NATIONAL
ASSOCIATION, a national banking association organized under the laws of the
United States, having an office located at Two Tower Center Boulevard, East
Brunswick, New Jersey 08816, as Agent for the Lenders under the Loan Agreement
(as such terms are hereinafter defined).
W I T N E S S E T H:
WHEREAS, pursuant to a certain Revolving Credit and Security Agreement
dated of even date herewith by and between Warner Chilcott, Inc., a Delaware
corporation (the "Borrower"), PNC Bank, National Association and one or more
financial institutions named therein or which hereafter become a party thereto
(together with PNC Bank, National Association, collectively, the "Lenders") and
PNC Bank, National Association as the agent for the Lenders (PNC Bank, National
Association in such capacity, the "Agent") (as such may be amended from time to
time, the "Loan Agreement"), the Lenders have agreed to make certain Revolving
Advances to the Borrower; and
WHEREAS, as a condition precedent to the making of the Revolving Advances
by the Lenders to the Borrower, the Guarantor has agreed to pledge certain
trademarks and trademark applications pursuant to a Trademark Collateral
Assignment and Security Agreement dated the date hereof, as security for the
Lender's repayment in full of all Obligations (as such term is defined in the
Loan Agreement) in accordance with the provisions of this Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to induce
the Lenders to make and/or continue to make the Revolving Advances (as each such
term is defined in the Loan Agreement), the Guarantor hereby agrees with the
Lenders as follows:
1. In consideration of the Revolving Advances made pursuant to the
terms of the Loan Agreement and Other Documents, and to enable the
Revolving Advances to be maintained or obtained by the Borrower under the
terms of the Loan Agreement, the Guarantor hereby irrevocably and
unconditionally guarantees the full, prompt and unconditional payment,
when due, whether by acceleration or otherwise, of any and all
liabilities, indebtedness, agreements or obligations of the Borrower, in
connection with the Obligations whether direct or indirect, now existing
or hereafter arising, contingent or absolute, joint or several, matured or
unmatured, together with interest thereon and all attorneys' fees, costs
and expenses of collection incurred by the Lenders in enforcing any of
such indebtedness; provided, however, that the Guarantor's obligations
hereunder shall be limited solely to any proceeds received by the Bank
upon the liquidation of the security interest granted in paragraph 12
hereof (the "Obligations of the Borrower" or "Obligations").
2. This Guaranty shall extend to and cover every extension or
renewal of, and every obligation accepted in substitution for, any
Obligations of the Borrower, which extensions, renewals or substitutions
are herein consented and agreed to, and the Guarantor shall be bound
hereby irrespective of the existence, value or condition of any collateral
the Lenders may at any time hold or the validity, irregularity or
enforceability of any instrument, writing or arrangement relating to any
such Obligations of the Borrower or collateral and irrespective of any
present or future law or order of any government (whether of right or in
fact) or of any
agency thereof, purporting to reduce, amend or otherwise affect any
Obligations of the Borrower or to vary the terms of payment of the
Obligations.
3. The Guarantor hereby warrants and represents as follows:
(a) The Guarantor has the legal capacity to execute, deliver
and carry out the terms of this Guaranty and all other instruments
and documents delivered and to be delivered by it in connection
herewith.
(b) This Guaranty has been duly executed and delivered and
constitutes the valid and legally binding obligation of the
Guarantor, enforceable in accordance with its terms.
(c) No consent or approval of any person or waiver of any lien
or right of distraint or similar right, and no consent, license,
approval or authorization of or registration, qualification,
designation, declaration or filing with any governmental authority
on the part of the Guarantor is required in connection with the
execution and delivery of this Guaranty.
(d) The Guarantor is not in default under any indenture,
mortgage, deed of trust, agreement or other instrument to which it
is a party or by which it is bound. The Guarantor is not in default
in any material respect under any applicable statute, rule, order,
decree or regulation of any court, arbitrator or governmental body
or agency having jurisdiction over the Guarantor.
(e) The execution, delivery and the performance of, and
compliance with, this Guaranty on the part of the Guarantor will not
(with or without the giving of notice or lapse of time, or both)
result in any violation of, or be in conflict with, or constitute a
default under, the terms of any contract, note indenture or other
agreement to which the Guarantor is a party, or of any judgment,
decree, order, statute, rule or regulation to which the Guarantor is
subject.
(f) The Guarantor is not a party to any agreement or
instrument or subject to any restrictions materially and adversely
affecting the business, properties or financial condition of the
Guarantor.
(g) There are no outstanding judgments, actions, proceedings,
claims or investigations pending or threatened before any court or
governmental body which may materially and adversely affect the
business, properties or financial condition of the Guarantor.
(h) All financial statements of the Guarantor previously
supplied to the Lenders are true and correct in all material
respects and present fairly the financial position of the Guarantor
as of the dates therein stated.
(i) The Guarantor has filed all tax returns which are required
to be filed, and has paid all taxes which have become due pursuant
to such returns or pursuant to any assessment received by it.
(j) Neither the financial statements referred to in subsection
(h), nor any certificate, statement, report or other document
furnished to the Lenders by the Guarantor in connection herewith or
in connection with any transaction contemplated hereby, nor this
Guaranty contain any untrue statement of material fact or omit to
state any material fact necessary in order to make the statements
contained therein not misleading.
(k) The Guarantor is solvent on the date hereof. For the
purpose of this Guaranty, the term "solvent" shall mean that: (i)
the fair value of the Guarantor's property is in excess of the total
amount of its debts; and (ii) the Guarantor is able to pay its debts
as they mature.
4. The Guarantor covenants and agrees as follows:
(a) The Guarantor shall, upon reasonable request of the
Lenders and as soon as reasonably possible, furnish, or cause to be
furnished, to the Lenders such other financial and business
information pertaining to the Guarantor as the Lenders may request.
(b) The Guarantor shall pay and discharge, as they become due,
all taxes, assessments, debts, claims and other governmental or
non-governmental charges lawfully imposed upon, or incurred by it or
its properties and assets, except taxes, assessments, debts, claims
and charges contested in good faith in appropriate proceedings.
(c) The Guarantor shall promptly notify the Lenders of any
litigation, actions, proceedings, claims or investigations pending
or threatened against it which may materially and adversely affect
the financial condition of the Guarantor.
(d) The Guarantor shall promptly notify the Lenders of any
material and adverse change in the financial condition of the
Guarantor, or of the existence of any default hereunder or any of
the documents delivered in connection with the Obligations.
5. The Guarantor hereby waives notice of acceptance of this Guaranty
and also waives diligence, presentment, demand, protest and notice of
dishonor of any obligations evidenced by a note or otherwise, and notice
of any other kind whatsoever.
6. The Guarantor hereby assents to all terms and agreements
heretofore or hereafter made by the Borrower, or any other obligor with
respect to the Revolving Advances, with the Lenders.
7. The Guarantor hereby consents and agrees that the Lenders may,
without prejudice to any claim against the Guarantor hereunder, at any
time, or from time to time, in the Lender's reasonable discretion and in
accordance with the terms of the Loan Agreement, and without notice to the
Guarantor: (a) renew, extend or change the time of payment and the manner,
place or terms of payment of any Obligations of the Borrower; (b)
exchange, release or surrender all or any collateral which the Lenders may
at any time hold as security for the Obligations of the Borrower, or the
obligations of the Guarantor independently hereunder; (c) waive, release
or subordinate any security interest, in whole or in part, now or
hereafter held as security for any of the Obligations of the Borrower, or
the obligations of the Guarantor hereunder; (d) sell and purchase by the
Lenders any collateral in which the Lenders have a security interest at
any public or private sale or at any broker's board, crediting net
proceeds upon any obligation secured thereby; (e) settle or compromise
with the Borrower or with any other obligor with respect to the Revolving
Advances, any Obligations of the Borrower; (f) subordinate the payment of
any Obligations of the Borrower or obligations of any other person or
entity to the payment of any other debt which may be owing to the Lenders;
or (g) apply any sums by whomsoever paid or whosoever realized to any
Obligations of the Borrower.
8. This Guaranty is a continuing guaranty and nothing shall
terminate, discharge or satisfy the liability of the Guarantor hereunder
until the earlier to occur of (i) the satisfaction in full of the
Obligations of the Borrower, or (ii) the liquidation of the security
interest ganted in paragraph 12 hereof.
9. The Lenders may, in their reasonable discretion, exercise any
right or remedy which the Lenders have under this Guaranty or by law (such
rights and remedies being cumulative and not alternative or exclusive)
without pursuing or exhausting any right or remedy the Lenders have
against the Borrower or any other person or entity or which the Lenders
have with respect to any collateral or any other guaranty of any or all of
such Obligations. The Lenders need not join the Borrower or any other
person or entity as a party in any action brought to enforce the
provisions hereof; and the Lenders may exercise any right or remedy which
it has under this Guaranty without regard to any actions or omissions of
the Borrower or any other person or entity.
10. No delay on the Lenders' part in exercising any right hereunder
or in taking any action to collect or enforce payment of any Obligations
of the Borrower, either as against the Borrower or any other person or
entity, shall operate as a waiver of any such right or in any manner
prejudice the Lenders' rights against the Guarantor.
11. The Guarantor agrees that, if any of the Obligations of the
Borrower are not satisfied when due, the Guarantor will, without demand
upon or notice to the Guarantor, forthwith satisfy such Obligations, or if
the maturity of any Obligations of the Borrower hereby guaranteed is
accelerated, by bankruptcy or otherwise as against the Borrower, such
maturity shall also be deemed accelerated for the purposes of this
Guaranty and without demand upon or notice to the Guarantor, and the Bank
shall collect from the Guarantor the total amount hereby guaranteed,
subject to the provisions of paragraph 12 hereof.
12. As security for the performance of the Guarantor's obligations
hereunder, the Guarantor: (a) has assigned to the Lenders certain
trademarks and trademark applications, and has executed, on even date
herewith, a certain Trademark Collateral Assignment and Security
Agreement; and (b) grants the Bank a security interest in and a right of
setoff against all monies, deposits, instruments or other property of any
kind, without limitation, owned by the Guarantor or in which the Guarantor
has a joint or contingent interest and which now or any time hereafter are
in the possession or control of the Bank or in transit by mail or carrier
to or from the Bank or in possession of any third person acting on the
Bank's behalf for any reason whatsoever. Notwithstanding any other
provision of this Guaranty, the obligations of the Guarantor hereunder are
non-recourse, and the Guarantor shall not be liable for any deficiency
that may remain with respect to the Obligations of the Borrower after
liquidation of the security as set forth above.
13. The Guarantor shall not exercise any rights they have acquired
by way of subrogation under this Guaranty or otherwise, unless and until
all of the Obligations of the Borrower have been paid in full. If any
payment is made to the Guarantor on account of such subrogation rights
when any of the Obligations of the Borrower are not paid in full, each and
every amount so paid will forthwith be turned over to the Bank to be
credited and applied upon any of the Obligations of the Borrower whether
matured or unmatured. Any and all present and future debts and obligations
of the Borrower to the Guarantor are hereby waived and postponed in favor
of and subordinated to the full payment and performance of all Obligations
of the Borrower to the Lenders.
14. This Guaranty shall continue to be effective or reinstated, as
the case may be, if at any time payment of any of the Obligations of the
Borrower, or any part thereof, is rescinded or must otherwise be returned
by the Bank upon the insolvency or bankruptcy of the Borrower, or
otherwise, as though such payment had not been made.
15. If the Obligations of the Borrower are also guaranteed by any
other person or entity, by continuing guaranty or by endorsement of any
note of the Borrower or otherwise, the obligation of such other person or
entity and the Guarantor's obligations hereunder shall be deemed to be
several, and the release by the Lender of any such other guarantor, or
settlement with such other guarantor or the revocation or impairment of
such guaranty, shall not operate to prejudice the Lenders' rights against
the Guarantor hereunder.
16. No waiver of any of the Lenders' rights hereunder and no
modification or amendment of this Guaranty, shall be deemed to be made by
the Lenders unless the same shall be in writing, duly signed on behalf of
the Bank by a duly authorized officer, and each such waiver, if any, shall
apply only with respect to the specific instance involved, and shall in no
way impair the rights or the obligations of the Guarantor to the Lenders
in any other respect at any other time.
17. Notwithstanding anything herein to the contrary, until such time
as the Obligations have indefeasibly been repaid in full or this Guaranty
is terminated pursuant to its terms, the Guarantor hereby irrevocably
waives and releases any and all legal and equitable rights to recover from
the Borrower (i) any sums paid by the Guarantor under the terms of this
Guaranty and/or other documents delivered in connection with the
Obligations including, without limitation, all rights of subrogation and
all other rights that would result in the Guarantor being deemed a
creditor of the Borrower under the Federal Bankruptcy Code, and any other
law, and (ii) any and all claims the Guarantor has or may have against the
Borrower which are not related to or arising from or in connection with
this Guaranty, or other documents delivered in connection with the
Obligations, that do or would result in the Guarantor being deemed a
creditor of the Borrower under the Federal Bankruptcy Code or any other
law.
18. The Lenders shall be under no duty or obligation to the
Guarantor or anyone else to, nor shall the Lenders have any liability
whatsoever to the Guarantor or anyone else for failing to: (i) preserve,
protect or marshal any collateral it may hold as security for the
Obligations of the Borrower, or the obligations of the Guarantor
hereunder; (ii) preserve or protect the rights of the Borrower or any
other obligor with respect to the Obligations against any person claiming
an interest in any collateral the Lenders may hold as security for the
Obligations of the Borrower, or the obligations of the Guarantor
hereunder; (iii) realize upon any collateral it may hold as security for
the Obligations of the Borrower, or the obligations of the Guarantor
hereunder; in any particular order or manner or seek repayment of the
Obligations from any particular source; or (iv) permit any substitution or
exchange of all or any part of any collateral it may hold as security for
the Obligations of the Borrower, or the obligations of the Guarantor
hereunder; or release any part of any said collateral from any lien, even
if that substitution or release would leave the Lenders adequately
secured.
19. All notices, requests and other communications pursuant to this
Guaranty shall be in writing, to be either delivered by hand, overnight
delivery, or sent certified mail, return receipt requested, addressed to
the Agent at its office located at Two Tower Center Boulevard, East
Brunswick, New Jersey 08816, ATTENTION: Commercial Finance Department, or
to the Guarantor at the address set forth on page 1 of this Guaranty, or
at such other address as either may give notice to the other as herein
provided. Any notice, request or communication hereunder shall be deemed
to have been given when delivered.
20. The words importing the singular number mean and include the
plural number and vice versa, and words of the masculine gender mean and
include correlative words of the feminine and/or neuter gender and vice
versa.
21. This Guaranty shall be construed in accordance with and governed
by the laws of the State of New Jersey.
22. This Guaranty shall be binding upon the Guarantor, as well as
its successors or assigns and inure to the benefit of the Lenders and the
Lenders' successors and assigns.
23. THE GUARANTOR HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION OF
THE COURTS OF THE STATE OF NEW JERSEY AND, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, OF ANY FEDERAL COURT LOCATED IN THE STATE OF NEW JERSEY IN
CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS GUARANTY. THE GUARANTOR HEREBY WAIVES THE DEFENSES OF FORUM NON
CONVENIENS AND IMPROPER VENUE.
24. THE GUARANTOR EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY
LITIGATION RELATING TO, IN CONNECTION WITH, OR ARISING OUT OF THIS
GUARANTY OR ANY OTHER DOCUMENT DELIVERED IN CONNECTION WITH ANY OF THE
OBLIGATIONS.
25. This Guaranty shall terminate upon the earlier to occur of (a)
the satisfaction in full of the Obligations of the Borrower or, (b) the
liquidation of the security interest granted in paragraph 12 hereof.
26. This Guaranty shall also terminate and the security for such
guaranty as set forth in Section 12 hereof shall be released in the event
that:
(a) The Guarantor transfers to a new entity the trademarks and
trademark applications which are the subject of the Trademark
Collateral Assignment and Security Agreement; and
(b) The new entity executes and delivers to the Agent for the
Lenders a continuing limited non-recourse and collateralized
guaranty as well as a trademark collateral assignment and security
agreement in forms substantially the same as being executed on the
date hereof by the Guarantor.
IN WITNESS WHEREOF, the Guarantor has executed this Guaranty this ___ day
of March, 1998.
WARNER CHILCOTT (BERMUDA) LIMITED
/s/Kevin Insley
---------------------------------
KEVIN INSLEY, Vice President