SECOND AMENDED AND RESTATED HOLDINGS GUARANTY
SECOND AMENDED AND RESTATED GUARANTY (as amended, modified or
supplemented from time to time, this "Guaranty"), dated as of June 30, 1989, as
amended and restated as of June 18, 1992, as further amended and restated as of
December 21, 1993, and as further amended and restated as of August 1, 1995,
made by SILGAN HOLDINGS INC., a Delaware corporation (the "Guarantor"). Except
as otherwise defined herein, terms used herein and defined in the Credit
Agreement (as hereinafter defined) shall be used herein as so defined.
W I T N E S S E T H :
WHEREAS, Silgan Corporation ("Silgan"), Silgan Containers
Corporation ("Containers"), Silgan Plastics Corporation ("Plastics", and
together with Containers and Silgan, collectively, the "Borrowers", and each a
"Borrower"), the lenders from time to time party thereto (the "Banks"), Bank of
America Illinois, as a Co-Arranger and as Documentation Agent, and Bankers Trust
Company, as a Co-Arranger and as Administrative Agent (the "Administrative
Agent", and together with the Banks and the Collateral Agent, the "Bank
Creditors") are party to the Credit Agreement, dated as of August 1, 1995 (as
the same may be amended, modified or supplemented from time to time, the "Credit
Agreement"), providing for the making of Loans and the issuance of, and
participation in, Letters of Credit as contemplated therein;
WHEREAS, one or more of the Borrowers are, or may from time to
time in the future be, party to one or more interest rate protection agreements
(including, without limitation, interest rate swaps, caps, floors, collars, and
similar agreements) (collectively, "Interest Rate Protection Agreements"), with
any Bank or an affiliate of a Bank (each such Bank or affiliate, even if the
respective Bank subsequently ceases to be a Bank under the Credit Agreement for
any reason, together with such Bank's or affiliate's successors and assigns, are
herein called the "Interest Rate Protection Creditors", and together with the
Bank Creditors, the "Secured Creditors");
WHEREAS, the Guarantor has heretofore entered into a Guaranty,
dated as of June 30, 1989, as amended and restated as of June 18, 1992, and as
further amended and restated as of December 21, 1993 (as amended, modified or
supplemented to the date hereof, the "Original Holdings Guaranty");
WHEREAS, each of the Borrowers is a Wholly-Owned Subsidiary of
the Guarantor;
WHEREAS, it is a condition to the above-mentioned extensions
of credit to the Borrowers that the Guarantor shall have executed and delivered
this Guaranty; and
WHEREAS, the Guarantor will obtain benefits as a result of the
entering into of the Credit Agreement, the consummation of the Transaction and
the extensions of credit to the Borrowers under the Credit Agreement and,
accordingly, the Guarantor desires to enter into this Guaranty in order to
satisfy the conditions described in the preceding paragraph and to amend and
restate the Original Holdings Guaranty in the form of this Guaranty;
NOW, THEREFORE, in consideration of the foregoing and other
benefits accruing to the Guarantor, the receipt and sufficiency of which are
hereby acknowledged, the Guarantor hereby makes the following representations
and warranties to the Secured Creditors and hereby covenants and agrees with
each Secured Creditor as follows:
1. The Guarantor hereby irrevocably and unconditionally
guarantees (x) to each Bank Creditor the full and prompt payment when due
(whether at the stated maturity, by acceleration or otherwise) of the principal
of and interest on each Note issued to such Bank Creditor under the Credit
Agreement, together with all other liabilities and obligations of the Borrowers
to the Bank Creditors (including, without limitation, to repay all Loans, Unpaid
Drawings, Fees, indemnities and interest) incurred or to be incurred under,
arising out of or in connection with, the Credit Agreement or any other Credit
Document and the due performance of and compliance with the terms, conditions
and agreements contained in the Credit Documents by each Borrower (all such
Notes, liabilities and other obligations are herein collectively called the
"Credit Agreement Obligations") and (y) to each Interest Rate Protection
Creditor the full and prompt payment when due (whether at the stated maturity,
by acceleration or otherwise) of all obligations of any Borrower owing under any
Interest Rate Protection Agreement, whether now in existence or hereafter
arising, and the due performance and compliance with all the terms, conditions
and agreements contained therein (all such obligations and liabilities being
herein collectively called the "Interest Rate Protection Obligations"; and
together with the Credit Agreement Obligations are herein collectively called
the "Guaranteed Obligations"). The Guarantor understands, agrees and confirms
that each Secured Creditor may enforce this Guaranty up to the full amount of
the Guaranteed Obligations against it without proceeding against the Borrowers,
against any security for the Guaranteed Obligations, against any other guarantor
or under any other guaranty covering the Guaranteed Obligations. This Guaranty
shall constitute a guaranty of payment and not of collection.
2. The Guarantor hereby waives notice of acceptance of this
Guaranty and notice of any liability to which it may apply, and waives
presentment, demand of payment, protest, notice of dishonor or nonpayment of any
such liabilities, suit or taking of other action by the Secured Creditors
against, and any other notice to, any party liable thereon (including the
Guarantor or any other guarantor).
3. Any Secured Creditor may at any time and from time to time
without the consent of, or notice to, the Guarantor, without incurring
responsibility to the Guarantor, without impairing or releasing the obligations
of the Guarantor hereunder, upon or without any terms or conditions and in whole
or in part:
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(a) change the manner, place or terms of payment of, and/or
change or extend the time of payment of, renew or alter, any of the
Guaranteed Obligations, any security therefor, or any liability
incurred directly or indirectly in respect thereof, and the guaranty
herein made shall apply to the Guaranteed Obligations as so changed,
extended, renewed or altered;
(b) sell, exchange, release, surrender, realize upon or
otherwise deal with in any manner and in any order any property by
whomsoever at any time pledged or mortgaged to secure, or howsoever
securing, the Guaranteed Obligations or any liabilities (including any
of those hereunder) incurred directly or indirectly in respect thereof
or hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against
any of the Borrowers or others or otherwise act or refrain from
acting;
(d) settle or compromise any of the Guaranteed Obligations,
any security therefor or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and may subordinate the payment of all or any part thereof to
the payment of any liability (whether due or not) of any Borrower to
creditors of such Borrower other than the Secured Creditors and the
Guarantor;
(e) apply any sums by whomsoever paid or howsoever realized to
any liability or liabilities of any Borrower to the Secured Creditors
regardless of what liability or liabilities of such Borrower remain
unpaid;
(f) consent to or waive any breach of, or any act, omission or
default under, any of the Interest Rate Protection Agreements or the
Credit Documents, or otherwise amend, modify or supplement any of the
Interest Rate Projection Agreements or the Credit Documents or any of
such other instruments or agreements; and/or
(g) act or fail to act in any manner referred to in this
Guaranty which may deprive the Guarantor of its right to subrogation
against any Borrower to recover full indemnity for any payments made
pursuant to this Guaranty.
4. No invalidity, irregularity or unenforceability of all or
part of the Guaranteed Obligations or of any security therefor shall affect,
impair or be a defense to this Guaranty, and this Guaranty is a primary
obligation of the Guarantor.
5. If and to the extent that the Guarantor makes any payment
to a Secured Creditor or to any other Person pursuant to or in respect of this
Guaranty, any claim which the Guarantor may have against any Borrower by reason
thereof shall be subject and subordinate to the prior payment in full of the
Guaranteed Obligations of each Secured Creditor.
6. As used in this Guaranty, the following terms shall have
the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
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"Continuing Holdings Directors" shall mean directors of the
Guarantor on the Effective Date and each other director of the Guarantor, if
such other director's nomination for election to the Board of Directors of the
Guarantor is recommended, or if such other director is elected, by a majority of
the other Continuing Holdings Directors.
"Dividend" shall mean, with respect to any Person, the payment
of any dividends to, or return any capital to, its stockholders or the
authorization of or making of any other distribution, payment or delivery of
property or cash to its stockholders as such, or redemption, retirement,
purchase or other acquisition, directly or indirectly, for a consideration, of
any shares of any class of its capital stock now or hereafter outstanding (or
any options or warrants or stock appreciation rights issued by such Person with
respect to its capital stock), or the setting aside of any funds for any of the
foregoing purposes.
"Holdings Stock Option Agreement" shall mean those various
stock option agreements pursuant to which the Guarantor has issued, or may from
time to time issue, Holdings Employee Stock Options.
"Permitted Holdings Debt Repurchases" shall mean one or more
open market or privately negotiated transactions or voluntary Refinancings
pursuant to which the Guarantor Refinances outstanding Holdings Debentures or
any Refinancing Indebtedness issued by the Guarantor so long as (i) at the time
of each such Refinancing, no Default or Event of Default then exists or would
result therefrom, (ii) the sources of funds used to effect any such Refinancing
derive solely from Net Equity Proceeds from one or more registered public equity
offerings by Holdings of its common stock, cash Dividends received from Silgan
pursuant to, and in accordance with the terms of, Section 8.03(x) or (xvii) of
the Credit Agreement, advances received from Silgan pursuant to, and in
accordance with the terms of, Section 8.06(xxiv) of the Credit Agreement,
repayments of intercompany advances by Silgan pursuant to, and in accordance
with the terms of Section 8.05(xix) of the Credit Agreement and/or, in the case
of Holdings Debentures, any Refinancing Indebtedness issued by the Guarantor,
(iii) on or prior to June 30, 1996, no Holdings Debentures are Refinanced at
more than 107% of the accreted value thereof at the time of such Refinancing,
and thereafter, all such Refinancings are at no greater than par, and (iv)
immediately following any such Refinancing (other than a Refinancing pursuant to
which the Holdings Debentures or such Refinancing Indebtedness are defeased in
accordance with the terms of the Holdings Debenture Indenture or the respective
Refinancing Indebtedness Documents), the Holdings Debentures or Refinancing
Indebtedness so Refinanced are cancelled by the Guarantor.
"Shareholders Agreement" shall mean the Amended and Restated
Organization Agreement, dated as of December 21, 1993, among Mr. R. Philip
Silver ("Silver"), Mr. D. Greg Horrigan ("Horrigan"), the Guarantor, The Morgan
Stanley Leveraged Equity Fund, II, L.P. ("MS Equity"), First Plaza Group Trust
("First Plaza") and Bankers Trust New York Corporation ("BTNY"), as amended,
modified or supplemented to the date hereof.
7. In order to induce the Bank Creditors to enter into the
Credit Agreement and to make the Loans and issue Letters of Credit pursuant to
the Credit Agreement, the Guarantor makes the following representations,
warranties and agreements:
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(a) Corporate Status. Each of the Guarantor and each of its
Subsidiaries (i) is a duly organized and validly existing corporation
in good standing under the laws of the jurisdiction of its
incorporation, (ii) has the corporate power and authority to own its
property and assets and to transact the business in which it is
engaged, and (iii) is duly qualified as a foreign corporation and in
good standing in each jurisdiction where the ownership, leasing or
operation of its property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not
have a material adverse effect on the business, operations, property,
assets or condition (financial or otherwise) of the Guarantor or of the
Guarantor and its Subsidiaries taken as a whole.
(b) Corporate Power and Authority. The Guarantor has the
corporate power and authority to execute, deliver and carry out the
terms and provisions of each of the Credit Documents to which it is
party and has taken all necessary corporate action to authorize the
execution, delivery and performance by it of each of the Credit
Documents to which it is a party. The Guarantor has duly executed and
delivered each of the Credit Documents to which it is party, and each
of the Credit Documents to which it is a party constitutes its legal,
valid and binding obligation enforceable in accordance with its terms
except to the extent that enforcement may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws affecting
creditors' rights generally and by equity principles (regardless of
whether enforcement is sought in equity or at law).
(c) No Violation. Neither the execution, delivery and
performance by each of the Guarantor and each of its Subsidiaries of
any Credit Document to which it is a party nor compliance by it with
the terms and provisions thereof (i) will contravene any provision of
any law, statute, rule or regulation or any order, writ, injunction or
decree of any court or governmental instrumentality, (ii) will conflict
or be inconsistent with or result in any breach of, any of the terms,
covenants, conditions or provisions of, or constitute a default under,
or result in the creation or imposition of (or the obligation to create
or impose) any Lien (except pursuant to the Security Documents) upon
any of the property or assets of the Guarantor or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of
trust, credit agreement, loan agreement or any other agreement,
contract or instrument to which the Guarantor or any of its
Subsidiaries is a party or by which it or any of its property or assets
is bound or to which it is subject (other than the Existing Senior
Secured Note Documents), or (iii) will violate any provision of the
Certificate of Incorporation or By-Laws of the Guarantor or any of its
Subsidiaries.
(d) Litigation. There are no actions, suits or proceedings
pending or, to the best knowledge of the Guarantor, threatened (i) with
respect to any Document or the Transaction (except as disclosed in the
Blecher Letter) or (ii) with respect to the Guarantor or any of its
Subsidiaries that are reasonably likely to have a material adverse
effect on (A) the business, operations, property, assets or condition
(financial or otherwise) of the Guarantor or the Guarantor and its
Subsidiaries taken as a whole, or (B) the ability of the Guarantor or
any of its Subsidiaries to perform its obligations under the Documents
to which it is party.
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(e) Liabilities; Assets. (i) Other than pursuant to the Credit
Documents to which the Guarantor is a party, the Holdings Debenture
Documents, and advances made to the Guarantor pursuant to Section
8.06(xviii) of the Credit Agreement and certain liabilities to certain
former stockholders of Silgan in connection with the Reorganization
there were as of the Effective Date no liabilities or obligations with
respect to the Guarantor of any nature whatsoever (whether absolute,
accrued, contingent or otherwise and whether or not due) which, either
individually or in the aggregate, would be material to the Guarantor
and its Subsidiaries taken as a whole. Except as described in the
previous sentence, as of the Effective Date, the Guarantor does not
know of any basis for the assertion against the Guarantor of any
liability or obligation of any nature whatsoever which, either
individually or in the aggregate, is reasonably likely to be material
to the Guarantor and its Subsidiaries taken as a whole.
(ii) As of the Effective Date, the Guarantor has no
significant assets other than its ownership interest in Silgan.
(f) Governmental Approvals. No order, consent, approval,
license, authorization, or validation of, or filing, recording or
registration with (except as have been obtained or made), or exemption
by, any governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in connection with
(i) the execution, delivery and performance by the Guarantor of any
Credit Document to which it is party or (ii) the legality, validity,
binding effect or enforceability of any Credit Document to which the
Guarantor is party.
(g) Holdings Pledge Agreement. The Holdings Pledge Agreement
is in full force and effect on and after the Effective Date and is one
of the Credit Documents subject to the representations and warranties
made in preceding clause (b) of this Section 7. The security interests
created in favor of the Collateral Agent under the Holdings Pledge
Agreement constitute first priority perfected security interests in the
respective Pledge Agreement Collateral in favor of the Collateral Agent
and subject to no Lien of any other Person. No consents, filings or
recordings are required in order to perfect (or maintain the perfection
or priority of) the security interests in the Pledged Securities
purported to be created by the Holdings Pledge Agreement.
(h) Capitalization. As of the Initial Borrowing Date, the
authorized capital stock of the Guarantor consists of 3,167,500 shares
of capital stock, consisting of (i) 500,000 shares of Class A Common
Stock, $0.01 par value, of which 417,500 shares are issued and
outstanding, (ii) 667,500 shares of Class B Common Stock, $0.01 par
value, all of which shares are issued and outstanding, (iii) 1,000,000
shares of Class C Common Stock, $0.01 par value, of which 50,000 shares
are issued and outstanding, and (iv) 1,000,000 shares of preferred
stock, none of which are issued and outstanding. All such outstanding
shares of capital stock of the Guarantor have been duly and validly
issued, are fully paid and non-assessable. As of the Initial Borrowing
Date, the Guarantor has issued and there are currently outstanding
options to purchase up to 24,000 shares of Class C Common Stock of the
Guarantor pursuant to the Guarantor's Amended and Restated Stock Option
Plan, which options are held by certain officers of the Company (the
"Guarantor Options"). The Guarantor does not have outstanding any
securities
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convertible into or exchangeable for its capital stock or outstanding
any rights to subscribe for or to purchase, or any options for the
purchase of, or any agreements providing for the issuance (contingent
or otherwise) of, or any calls, commitments or claims of any character
relating to, its capital stock, except (i) the right of the Guarantor
to call, and the obligation of the Guarantor to repurchase, the Class A
Common Stock held by Silver and Horrigan (or certain related Persons)
as set forth in Sections 5.5 and 5.6 of the Shareholders Agreement,
provided that any payment obligation with respect thereto shall be
evidenced by a promissory note of the Guarantor issued in the form of
Exhibit A hereto (a "Shareholder Subordinated Note"), (ii) the right of
the Guarantor to call, and the obligation of the Guarantor to
repurchase, certain options (the "Holdings Employee Stock Options") or
common stock held by certain other employees of the Guarantor, provided
that any payment obligation with respect thereto shall be evidenced by
a Shareholder Subordinated Note which may not provide for payment of
interest in cash, except in the case of the holders of Holdings
Employee Stock Options on the Effective Date, before the earlier of (a)
June 15, 2002 and (b) any date after the termination of the Guaranteed
Obligations, (iii) the rights of first refusal granted under the
Shareholders Agreement and the Stockholders Agreement, dated as of
December 21, 1993, among Silver, Horrigan, MS Equity, BTNY, First Plaza
and the Guarantor (the "Stockholders Agreement"), (iv) the right of the
Guarantor to call the Class B Common Stock held by Mellon Bank, N.A.,
as trustee for First Plaza pursuant to Article VI of the Shareholders
Agreement, (v) payments relating to the Holdings Employee Stock Options
in respect of 24,000 shares of common stock of the Guarantor to be
issued to certain employees and/or officers of the Guarantor pursuant
to the Holdings Stock Option Agreement, provided that such payments
shall be subject to the limits set forth in Section 8(b)(iii) of this
Guaranty and in Sections 8.03(i) and (vii) of the Credit Agreement,
(vi) pursuant to the Containers Second Amended and Restated 1989 Stock
Option Plan (the "Containers Option Plan"), under which options are
held by certain officers of Containers (the "Containers Options"), and
the 1994 Stock Option Plan of Plastics (the "Plastics Option Plan"),
under which options are held by certain officers of Plastics (the
"Plastics Options"), in the event of a "public offering" of the common
stock of the Guarantor, or a "change of control" of the Guarantor,
Containers Options and Plastics Options shall, pursuant to the terms of
the Containers Option Plan and the Plastics Option Plan, respectively,
be converted into options to purchase common stock of the Guarantor,
and shares previously issued upon the exercise of Containers Options or
Plastics Options shall, pursuant to the terms of the Containers Option
Plan or the Plastics Option Plan, respectively, be converted into
shares of common stock of the Guarantor, and (vii) the rights and
obligations of any Regulated Stockholder of the Guarantor (as defined
in the Restated Certificate of Incorporation of the Guarantor) to
convert shares of one class of common stock of the Guarantor into
shares of another class of common stock of the Guarantor pursuant to
the terms of Paragraph D of Article SEVENTH of the Restated Certificate
of Incorporation of the Guarantor.
(i) Compliance with Statutes, etc. Each of the Guarantor and
each of its Subsidiaries is in compliance with all applicable statutes,
regulations and orders of, and all applicable restrictions imposed by,
all governmental bodies, domestic or foreign, in respect of the conduct
of its business and the ownership of its property (including applicable
statutes, regulations, orders and restrictions relating to
environmental standards
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and controls, equal opportunity employment and employee safety), except
for such non- compliances which, in the aggregate for the Guarantor and
its Subsidiaries, would not have a material adverse effect on the
business, property, assets or condition (financial or otherwise) of the
Guarantor and its Subsidiaries taken as a whole.
(j) Tax Returns and Payments. Each of the Guarantor and each
of its Subsidiaries has filed all federal tax returns and material
state tax returns required to be filed by it and has paid all income
taxes payable by it which have become due pursuant to such tax returns
and all other taxes and assessments payable by it which have become
due, other than those not yet delinquent and except for those contested
in good faith. Each of the Guarantor and each of its Subsidiaries has
paid, or has provided adequate reserves (in the good faith judgment of
the management of the Guarantor) for the payment of, all federal and
state income taxes applicable for all prior fiscal years and for the
current fiscal year to the date hereof.
(k) Investment Company Act. The Guarantor is not an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended.
(l) True and Complete Disclosure. To the best of the
Guarantor's knowledge after due inquiry, each Credit Document to which
the Guarantor is party and all other written information furnished to
the Secured Creditors by or on behalf of the Guarantor in connection
herewith and therewith did not taken as a whole contain any untrue
statement of material fact or omit to state a material fact (taken as a
whole) necessary in order to make the information contained herein and
therein not misleading.
(m) Holdings. Except to the extent permitted by the Credit
Agreement, the Guarantor owns all of the outstanding and issued
capital stock of Silgan. The Guarantor has no direct Wholly-Owned
Subsidiaries other than Silgan.
(n) Representations and Warranties in Other Agreements. All
representations and warranties made by any Credit Party in the
Documents to which it is a party are true and correct in all material
respects as of the time as of which such representations and warranties
were made or deemed made.
(o) Absence of Default and Events of Default. No event has
occurred and no condition exists, or by reason of any of the
transactions contemplated by the Documents or otherwise will occur or
exist, which would constitute a Default or an Event of Default under
the Credit Agreement.
8. The Guarantor covenants and agrees that on and after the
Effective Date and for so long as the Credit Agreement is in effect and until
the Total Commitment and all Letters of Credit have terminated and the Loans,
Notes and Unpaid Drawings, together with interest, Fees and all other
Obligations incurred hereunder and thereunder are paid in full, it will:
(a) Liens. Not create, assume or suffer to exist any Lien upon
any of its properties or assets, whether now owned or hereafter
acquired, except (i) Liens in favor of the Collateral Agent pursuant to
the Holdings Pledge Agreement, (ii) inchoate tax
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Liens for taxes not yet due and payable and (iii) Liens for taxes being
contested in good faith and by appropriate proceedings for which
adequate reserves (in the good faith judgment of the management of the
Guarantor) have been established.
(b) Distributions. Not declare or make any Dividend to its
shareholders, except that:
(i) the Guarantor may, upon the death, disability or
termination of employment of Silver and/or Horrigan and
pursuant to the terms and conditions set forth in Sections 5.5
and 5.6 of the Shareholders Agreement, purchase the Class A
Common Stock held by such persons, their estates or certain
other related Persons, provided that the total consideration
paid to such persons or their estate for such purchase shall
be evidenced by a Shareholder Subordinated Note;
(ii) the Guarantor may, upon death, disability or
termination of certain other employees and/or officers of the
Guarantor, purchase certain options or common stock of such
employees, provided that the total consideration paid for such
purchase shall be evidenced by a Shareholder Subordinated Note
containing subordination provisions contained in Annex A
thereto and upon which no interest shall be payable in cash,
except in the case of the holders of the Holdings Employee
Stock Options on the Effective Date, before the earlier of (a)
June 15, 2002 and (b) the date of the termination of the
Guaranteed Obligations;
(iii) the Guarantor may (x) repurchase or redeem its
Holdings Employee Stock Options and (to the extent such
Holdings Employee Stock Options have been validly exercised)
the common stock of the Guarantor issued upon the exercise
thereof, all as set forth in the Holdings Stock Option
Agreement and (y) make required payments with respect to the
stock appreciation rights granted in connection with its
Holdings Employee Stock Options, provided that no payment of
the types described in this clause (iii) may be made if (1) at
the time of such payment a Default or an Event of Default then
exists or would result therefrom and (2) the amount of such
payment, when aggregated with the amount of all other such
payments permitted pursuant to Sections 8.03(i) and (vii) of
the Credit Agreement made after the Effective Date and
including such date by Silgan, Containers, Plastics and the
Guarantor on an aggregate basis would exceed an amount equal
to 5% of Consolidated Net Worth at the end of the last fiscal
quarter for which financial statements are required to have
been delivered pursuant to Section 7.01(b) of the Credit
Agreement;
(iv) so long as no Default or Event of Default then
exists or would result therefrom, Holdings may repurchase
shares of its Class B Common Stock held by First Plaza
pursuant to, and in accordance with the terms of, the
Shareholders Agreement with proceeds received from (i) Silgan
pursuant to, and in accordance with the terms of, Section
8.03(xi) of the Credit Agreement and/or (ii) one or more
common equity offerings by Holdings;
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(v) so long as no Default or Event of Default then
exists or would result therefrom, Holdings may pay cash
Dividends with proceeds received from Silgan pursuant to, and
in accordance with the terms of, Sections 8.03(xii) and (xiii)
of the Credit Agreement; and
(vi) so long as no Default or Event of Default would
result therefrom, Holdings may pay Dividends in respect of its
common stock in additional shares of common stock.
(c) Indebtedness. Not create, incur, assume or suffer to
exist any Indebtedness except:
(i) Indebtedness incurred under this Guaranty;
(ii) Indebtedness represented by the Holdings
Debentures in an aggregate face amount not to exceed
$275,000,000 (as reduced by any repayments of principal
thereof);
(iii) Indebtedness represented by advances made to
the Guarantor pursuant to Sections 8.06(xvi), (xviii), (xxiv)
and (xxvi) of the Credit Agreement;
(iv) upon the purchase of the common stock and/or
options as permitted by Section 8(b) hereof, Indebtedness of
the Guarantor represented by a Shareholder Subordinated Note
issued by the Guarantor as consideration therefor; and
(v) unsecured subordinated Indebtedness of the
Guarantor the proceeds of which are used within 60 days after
the incurrence thereof to Refinance outstanding Holdings
Debentures pursuant to a Permitted Holdings Debt Repurchase so
long as (w) no Default or Event of Default then exists or
would result therefrom, (x) all of the terms and conditions of
such Indebtedness (including, without limitation,
subordination provisions, covenants, events of default,
interest rates, remedies, amortizations and maturities) are
reasonably acceptable to the Co-Arrangers and the Required
Banks, it being understood that in any event such Indebtedness
shall not have any scheduled maturity, amortization or sinking
fund payment earlier than the final scheduled maturity of the
Holdings Debentures, (y) the aggregate principal amount of
such Indebtedness does not exceed the aggregate principal
amount of the Holdings Debentures to be Refinanced with such
Indebtedness, together with all accrued interest thereon, any
prepayment premium associated therewith and all costs and
expenses incurred in connection therewith and (z) until such
proceeds are used to Refinance outstanding Holdings
Debentures, the Guarantor shall immediately contribute and/or
advance such proceeds to Silgan to be immediately used by
Silgan to (i) repay outstanding Revolving Loans and/or
Swingline Loans and/or (ii) be placed in a cash collateral
account established and maintained by, and pursuant to
arrangements satisfactory to, the Administrative Agent.
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(d) Advances, Investments and Loans. Not make or permit to
remain outstanding any loans or advances by it to any other Person, or
purchase or acquire any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any other
Person, except that (i) the Guarantor may own the capital stock of
Silgan, (ii) the Guarantor may make capital contributions to, or
purchase additional shares of the common stock of, Silgan and (iii) the
Guarantor may make advances to Silgan on the terms and conditions set
forth in Section 8.05(xix) of the Credit Agreement. If at any time
after the Initial Borrowing Date the Guarantor holds cash or Cash
Equivalents which exceed $250,000 in the aggregate for any period of
five consecutive Business Days, such excess shall be contributed and/or
advanced (to the extent permitted by clause (iii) of the immediately
preceding sentence) to Silgan on the sixth such Business Day.
(e) Merger and Sale of Assets; Issuance of Stock. Not (i) wind
up, liquidate or dissolve its affairs or enter into any transaction of
merger or consolidation, or convey, sell, lease or otherwise dispose of
(or agree to do any of the foregoing at any future time) all or any
part of its property or assets, or purchase or otherwise acquire (in
one or a series of related transactions) any part of the property or
assets of any Person, except that the Holdings Merger shall be
permitted in accordance with the terms of Section 8.02(x) of the Credit
Agreement or (ii) sell, assign, lease, transfer or otherwise dispose of
any shares of capital stock of Silgan.
(f) Business. Not engage in any business, enter into any
material agreements or incur, assume or suffer to exist any significant
liabilities, in either case on and after the Effective Date other than
(i) the ownership of the capital stock of Silgan, (ii) the issuance of
Shareholder Subordinated Notes referred to in Sections 8(b)(i) and (ii)
hereof, (iii) the transactions in connection with the investments,
advances and loans permitted under Section 8(d) hereof, (iv) in respect
of the transactions, agreements and liabilities permitted to be
incurred or entered into by the terms of this Guaranty and (v) the
management and administration of Holdings and its Subsidiaries
substantially as conducted on the date hereof.
(g) Preservation of Existence, etc. Preserve and maintain its
corporate existence, rights, franchises and privileges in the
jurisdiction of its organization, except that the Holdings Merger shall
be permitted in accordance with the terms of Section 8.02(x) of the
Credit Agreement.
(h) Compliance with Statutes, etc. Comply, and cause each of
its Subsidiaries to comply, with all applicable statutes, regulations
and orders of, and all applicable restrictions imposed by, all
governmental bodies, domestic or foreign, in respect of the conduct of
its business and the ownership of its property (including applicable
statutes, regulations, orders and restrictions relating to
environmental standards and controls), except such noncompliances as
would not, in the aggregate, have a material adverse effect on the
business, operations, property, assets or condition (financial or
otherwise) of the Guarantor or the Guarantor and its Subsidiaries taken
as a whole.
(i) Information Covenants. Furnish to each Bank copies of
any financial information provided, or required to be provided, to the
holders of the Holdings
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Debentures or any Refinancing Indebtedness issued by it pursuant to the
terms thereof or the terms of the other Holdings Debenture Documents or
Refinancing Indebtedness Documents, as the case may be, and also the
following:
(A) Notice of Default or Litigation. Promptly, and in
any event within three Business Days after an officer of the
Guarantor obtains knowledge thereof, notice of (i) the
occurrence of any event which constitutes a Default or an
Event of Default, (ii) any litigation or governmental
proceeding (x) against the Guarantor or any of its
Subsidiaries which is reasonably likely to materially and
adversely affect the business, operations, property, assets or
condition (financial or otherwise) of the Guarantor or any of
its Subsidiaries or (y) with respect to any Document, and
(iii) any other event (including any such event relating to
environmental matters) which is likely to materially and
adversely affect the business, operations, property, assets or
condition (financial or otherwise) of the Guarantor or any of
its Subsidiaries.
(B) Other Reports and Filings. Promptly, copies of
all financial information, proxy materials and other
information and reports, if any, (i) which the Guarantor shall
file with the SEC, or (ii) which the Guarantor shall deliver
to the holders of, or to the trustee with respect to, the
Holdings Debentures, any Refinancing Indebtedness issued by it
or its capital stock.
(C) Other Information. From time to time, such other
information or documents (financial or otherwise) as the
Agent, the any Co-Arranger or the Required Banks may
reasonably request.
(j) Inspection of Records. Permit any Person designated by the
Agent, any Co- Arranger or any Bank, under guidance of officers of the
Guarantor, to examine the books and financial records of the Guarantor
and make copies thereof or extracts therefrom and to discuss its
affairs, finances and accounts with the principal officers of the
Guarantor and its independent public accountants, all at such
reasonable times and as often as the Agent, any Co-Arranger or any Bank
may reasonably request.
(k) Properties and Accounts. Keep true books of records and
accounts in which full and correct entries will be made of all its
business transactions, and will reflect in its financial statements
adequate accruals and appropriations to reserves, all in accordance
with generally accepted accounting principles.
(l) Taxes. Pay when due, and cause each of its Subsidiaries to
pay when due, all taxes which, if not paid when due, would materially
and adversely affect the business, operations, property, assets or
condition (financial or otherwise) of the Guarantor or of the Guarantor
and its Subsidiaries taken as a whole, except as contested in good
faith and by appropriate proceedings if adequate reserves (in the good
faith judgment of the management of the Guarantor) have been
established with respect thereto.
(m) Holdings. Except as permitted by the Credit Agreement,
not at any time own less than 100% of the outstanding capital stock of
Silgan.
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(n) Transactions with Affiliates. Not enter into any
transaction or series of transactions, whether or not in the ordinary
course of business, with any Affiliate other than on terms and
conditions substantially as favorable to the Guarantor as would be
obtainable by the Guarantor at the time in a comparable arm's-length
transaction with a Person other than an Affiliate, provided that:
(i) the Guarantor may make payments as are required
pursuant to and perform its obligations under the Management
Services Agreement to which it is a party, provided that the
Quarterly Management Fee (as defined in such Management
Services Agreement) shall accrue but not be paid by the
Guarantor upon the occurrence of certain events, and to the
extent, provided in such Management Services Agreement;
(ii) Silgan may make distributions, advances and
loans to the Guarantor to the extent permitted by Sections
8.03, 8.05 and 8.06 of the Credit Agreement;
(iii) each of the Guarantor and its Domestic
Subsidiaries may execute, deliver and perform the Tax Sharing
Agreement;
(iv) each of the Guarantor and each of its
Subsidiaries may execute, deliver and perform the Documents
to which it is a party;
(v) the Guarantor may execute, deliver and perform
the Shareholders Agreement and Stockholders Agreement; and
(vi) the Guarantor may perform certain administrative
functions for Silgan and its Subsidiaries and the Guarantor
may receive the amounts permitted by Section 8.07(iv) of the
Credit Agreement.
(o) Limitation on Modifications of Documents; Voluntary
Prepayments. Not (i) make any voluntary or optional payment or
prepayment on or redemption or acquisition for value of (including,
without limitation, by depositing with the trustee with respect thereto
any money or securities before due for the purpose of paying when due),
or exchange, the Holdings Debentures, any Refinancing Indebtedness or
any Shareholder Subordinated Notes permitted to be issued by the
Guarantor pursuant to Sections 8(b)(i) and (ii) of this Guaranty, or
make any purchase, redemption or acquisition for value (or any offer to
purchase, redeem or acquire) of any Holdings Debentures or any
Refinancing Indebtedness, whether as a result of an Other Indebtedness
Change of Control, the consummation of asset sales or otherwise,
provided, however, that Holdings may Refinance outstanding Holdings
Debentures and/or any Refinancing Indebtedness issued by it through
Permitted Holdings Debt Repurchases or (ii) amend or modify, or permit
the amendment or modification of, any provision of the Holdings
Debenture Documents, any Refinancing Indebtedness Documents, any
Shareholder Subordinated Notes permitted to be issued by the Guarantor
pursuant to Sections 8(b)(i) and (ii) of this Guaranty or of any
agreement (including, without limitation, any purchase agreement,
indenture or loan agreement) relating to any of the foregoing or (iii)
amend or modify, or permit the amendment or modification of, any
provision of the Tax Sharing
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Agreement (except that modifications to the Tax Sharing Agreement may
be made with the consent of the Administrative Agent for the purpose of
adding additional Subsidiaries of Holdings as parties thereto on
substantially the same basis as the existing Subsidiaries of Holdings)
or any Management Services Agreement or (iv) amend, modify or change
the Shareholders Agreement, Stockholders Agreement, the Holdings Stock
Option Agreement, the Holdings Employee Stock Options (except, in the
case of the Holdings Stock Option Agreement and the Holdings Employee
Stock Options, immaterial changes which could not adversely affect the
Secured Creditors), its Certificate of Incorporation (including,
without limitation, by the filing or modification of any certificate of
designation) or By-Laws (other than amendments to its Certificate of
Incorporation and By-Laws in the respective forms attached to, and as
contemplated by, the Shareholders Agreement as in effect on the date
hereof), or any other agreement entered into by the Guarantor with
respect to its capital stock, or enter into any new agreement with
respect to its capital stock (except that the issuance of new Holdings
Employee Stock Options by the Guarantor in substantially the form
furnished to the Banks on or prior to the Effective Date shall, subject
to Section 9(g) hereof, be permitted).
(p) ERISA. Comply with ERISA with respect to each Plan and
will not incur any material obligation to PBGC, any material withdrawal
liability to any Multi-employer Plan or any material accumulated
funding deficiency within the meaning of ERISA, in each of the
foregoing cases so as to have a materially adverse effect on the
assets, business, financial condition, operations or prospects of the
Guarantor or so as to impair the ability of the Guarantor to perform
its obligations hereunder.
(q) Limitation on Issuances of Capital Stock by Subsidiaries.
Not permit any of its Subsidiaries to issue any capital stock
(including by way of sales of treasury stock) or any options or
warrants to purchase, or securities convertible into, capital stock,
except for (i) transfers and replacements of then outstanding shares of
capital stock, (ii) stock splits, stock dividends and similar issuances
which do not decrease the direct or indirect percentage ownership of
the Guarantor in any class of the capital stock of such Subsidiary,
(iii) subject to Section 7.09 of the Credit Agreement, the Employee
Stock Options (and any common stock issuable upon exercise thereof),
(iv) subject to Section 8.15 of the Credit Agreement, issuances of
common stock by Containers and Plastics to Silgan, (v) issuances of
common stock by Silgan in connection with a registered public equity
offering by Silgan and (vi) additional issuances by Silgan of its
common stock to Holdings.
(r) Compliance with Credit Documents. Cause each other Credit
Party to comply with each term, covenant and agreement set forth in the
Credit Documents, and, if the Guarantor receives any amounts in
contravention of such terms, covenants and agreements, the Guarantor
shall immediately pay such amounts to the Collateral Agent to be
applied to the Guaranteed Obligations if then due and payable, and
otherwise, to be held as collateral for the Guaranteed Obligations.
(s) Contribution; Advances. Contribute and/or advance (to the
extent permitted by Section 8.05(xix) of the Credit Agreement) to
Silgan, upon receipt thereof, an amount equal to 100% of the Net Equity
Proceeds of any sale of equity by the Guarantor (except
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to the extent that the proceeds thereof are to be applied within five
Business Days thereof to Refinance outstanding Holdings Debentures or
any Refinancing Indebtedness and/or for the purpose described in
Section 8(b)(iv) of this Guaranty) and, to the extent so contributed
and/or advanced, cause Silgan to apply such proceeds as a mandatory
prepayment of the Term Loans as (and to the extent) required by Section
4.02(g) of the Credit Agreement.
(t) Designated Senior Indebtedness. Will not designate any
Indebtedness, other than the Obligations and, prior to the Existing
Senior Secured Notes Redemption Date, the Existing Senior Secured
Notes, as "Designated Senior Indebtedness" for purposes of the Holdings
Debentures or any Refinancing Indebtedness issued by the Guarantor.
9. The occurrence of any of the following specified events
shall constitute an event of default (an "Event of Default") hereunder:
(a) Payment. Any payment default shall exist with respect to
any of the Guaranteed Obligations which continues unremedied for two or
more Business Days; or
(b) Representations, etc. (i) Any representation, warranty or
statement made by the Guarantor herein or by any other Credit Party in
any other Credit Document or in any certificate delivered pursuant
hereto or thereto shall prove to be untrue or inaccurate in any
material respect on the date as of which made or deemed made.
(ii) Any representation, warranty or statement made in the
Shareholders Agreement made by any party thereto shall prove to be
untrue or misleading, and all such untrue and misleading
representations, warranties and statements shall evidence a material
adverse difference in the business, operations, property, assets,
condition (financial or otherwise) or prospects of the Guarantor or
Silgan.
(c) Covenants. The Guarantor shall (i) default in the due
performance or observance by it of any term, covenant or agreement
(other than those referred to in Section 9(a) and (b) above and clause
(ii) of this Section 9(c)) contained in this Guaranty and such default
shall continue unremedied for a period of 30 days after written notice
to the Guarantor by the Administrative Agent, any Co-Arranger or any
Bank or (ii) default in the due performance or observance by it of any
term, covenant or agreement contained in Sections 8(a), (b), (c), (d),
(e), (f), (g), (i)(A)(i), (m), (n), (o), (p), (q), (s) and (t) of this
Guaranty; or
(d) Default Under Other Agreements; etc. (i) The Guarantor or
any of its Subsidiaries shall (A) default in any payment of any
Indebtedness (other than the Inter- company Notes) beyond the period of
grace, if any, provided in the instrument or agreement under which such
Indebtedness was created, (B) default in the observance or performance
of any agreement or condition relating to any Indebtedness (other than
the Intercompany Notes) or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause (deter-
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mined without regard to whether any notice is required but giving
effect to any grace period), any such Indebtedness to become due prior
to its stated maturity or (C) have any Indebtedness (other than the
Intercompany Notes) of the Guarantor or any of its Subsidiaries
declared to be due and payable, or required to be prepaid other than by
a regularly scheduled required prepayment, prior to the stated maturity
thereof; provided that (x) on or prior to the Existing Senior Secured
Notes Redemption Date, any event of default under, or any acceleration
of, the Existing Senior Secured Notes or the other Existing Senior
Secured Note Documents shall not constitute an Event of Default under
this clause (d) and (y) it shall not be an Event of Default under this
subsection (d) unless the aggregate Indebtedness referred to in
subclauses (A), (B) and (C) above exceeds $1,000,000; or (ii) any
Credit Document shall cease to be in full force and effect, or any
Security Document shall cease to give the Collateral Agent the Liens,
rights, powers and privileges purported to be created thereby
(including, without limitation, a first priority perfected security
interest in, and Lien on, all of the respective Collateral), in favor
of the Collateral Agent for the benefit of the Secured Creditors,
superior to and prior to the rights of all third Persons (except that
the security interests created by the Security Agreement may be junior
to the Permitted Liens, the security interests created by the Mortgages
may be subject to the respective Permitted Encumbrances and the
security interests created by the Additional Security Documents may be
subject to Liens permitted by Section 8.01 of the Credit Agreement), or
any party to any Security Document shall default in the due performance
or observance of any term, covenant or agreement on its part to be
performed pursuant to such Security Document; or
(e) Bankruptcy, etc. The Guarantor shall commence a voluntary
case concerning itself under the Bankruptcy Code; or an involuntary
case is commenced against the Guarantor or any of its Subsidiaries, and
the petition is not controverted within 10 days, or is not dismissed
within 60 days, after commencement of the case; or a custodian (as
defined in the Bankruptcy Code) is appointed for, or takes charge of,
all or substantially all of the property of the Guarantor or any of its
Subsidiaries, or the Guarantor or any of its Subsidiaries commences any
other proceeding under any reorganization, arrangement, adjustment of
debt, relief of debtors, dissolution, insolvency or liquidation or
similar law of any jurisdiction whether now or hereafter in effect
relating to the Guarantor or any of its Subsidiaries, or there is
commenced against the Guarantor or any of its Subsidiaries any such
proceeding which remains undismissed for a period of 60 days or the
Guarantor or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case
or proceeding is entered; or the Guarantor or any of its Subsidiaries
suffers any appointment of any custodian or the like for it or any
substantial part of its property to continue undischarged or unstayed
for a period of 60 days; or the Guarantor or any of its Subsidiaries
makes a general assignment for the benefit of creditors; or any
corporate action is taken by the Guarantor or any of its Subsidiaries
for the purpose of effecting any of the foregoing; or
(f) Judgments. One or more judgments or decrees shall be
entered against the Guarantor or any of its Subsidiaries involving,
when added to any other judgments or decrees of the Guarantor and its
Subsidiaries, a liability (not paid or fully covered by a reputable and
solvent insurance company) of $1,000,000 or more, and all such
judgments
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or decrees shall not have been vacated, discharged or stayed or bonded
pending appeal within 60 days from the entry thereof; or
(g) Change in Control. (i) Prior to the occurrence of an
initial registered public equity offering by the Guarantor of its
common stock, the Group and/or MS Equity (each as defined in the
Shareholders Agreement) and/or any Person (other than First Plaza or
any transferee thereof (other than any other shareholder of the
Guarantor party to the Shareholders Agreement on the Effective Date))
exercising rights of first refusal under the Shareholders Agreement
shall fail to own a majority of the Class A Common Stock of the
Guarantor, or the Group and/or MS Equity and/or any Person (other than
First Plaza or any transferee thereof (other than any other shareholder
of the Guarantor party to the Shareholders Agreement on the Effective
Date)) exercising rights of first refusal under the Shareholders
Agreement shall fail to own a majority of the Class B Common Stock of
the Guarantor or (ii) after the occurrence of an initial registered
public equity offering by the Guarantor of its common stock, (x) any
Person or group (within the meaning of Sections 13(d) and 14(d) of the
Securities Exchange Act), other than a Permitted Holder, individually
or collectively, (I) shall have acquired the beneficial ownership (as
such term is defined in Rule 13D-3 promulgated under the Securities
Exchange Act) of 30% or more on a fully diluted basis of the voting and
economic interest of the Guarantor or (II) shall have obtained the
power (whether or not exercised) to elect a majority of Holdings'
directors or (y) the Board of Directors of the Guarantor shall not
consist of a majority of Continuing Holdings Directors.
10. (a) The Guarantor hereby waives all rights of subrogation
which it may at any time otherwise have as a result of this Guaranty (whether
contractual, under Section 509 of the Bankruptcy Code, or otherwise) to the
claims of the Secured Creditors against the Borrowers or any other guarantor of
the Guaranteed Obligations (collectively, the "Other Parties") and all
contractual, statutory or common law rights of reimbursement, contribution or
indemnity from any Other Party which it may at any time otherwise have as a
result of this Guaranty. The Guarantor hereby further waives any right to
enforce any other remedy which the Secured Creditors now have or may hereafter
have against any Other Party, any endorser or any other guarantor of all or any
part of the indebtedness of the Borrowers and any benefit of, and any right to
participate in, any security or collateral given to or for the benefit of the
Secured Creditors to secure payment of the indebtedness of the Borrowers. The
Guarantor also waives all claims (as such term is defined in the Bankruptcy
Code) it may at any time otherwise have against any Other Party arising from any
transaction whatsoever, including, without limitation, its right to assert or
enforce any such claims.
(b) Notwithstanding the provisions of the preceding clause
(a), the Guarantor shall have and be entitled to (i) all rights of subrogation
otherwise provided by law in respect of any payment it may make or be obligated
to make under this Guaranty and (ii) all claims (as defined in the Bankruptcy
Code) it would have against any Other Party in the absence of the preceding
clause (a), and to assert and enforce same, in each case on and after, but at no
time prior to, the date (the "Subrogation Trigger Date") which is one year and
five days after the date on which all indebtedness of the Borrowers owing to the
Secured Creditors has been paid in full if and only if (x) no Default or Event
of Default of the type described in Section 9.05 of the Credit Agreement with
respect to the respective Other Party has existed at any time on and after
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the date of this Guaranty to and including the Subrogation Trigger Date and (y)
the existence of the Guarantor's rights under this clause (b) would not make the
Guarantor a creditor (as defined in the Bankruptcy Code) of the respective Other
Party in any insolvency, bankruptcy, reorganization or similar proceeding
commenced on or prior to the Subrogation Trigger Date.
(c) The Guarantor understands, is aware and hereby
acknowledges that to the extent the Guaranteed Obligations are secured by real
property located in the State of California, the Guarantor shall be liable for
the full amount of its liability hereunder notwithstanding foreclosure on such
real property by trustee sale or any other reason impairing the Guarantor's or
any Secured Creditors' right to proceed against any Borrower. The Guarantor
hereby waives, to the fullest extent permitted by law, all rights and benefits
under Section 2809 of the California Civil Code purporting to reduce a
guarantor's obligation in proportion to the principal obligation. The Guarantor
hereby waives all rights and benefits under Section 580a of the California Code
of Civil Procedure purporting to limit the amount of any deficiency judgment
which might be recoverable following the occurrence of a trustee's sale under a
deed of trust and all rights and benefits under Section 580b of the California
Code of Civil Procedure stating that no deficiency may be recovered on a real
property purchase money obligation. The Guarantor further understands, is aware
and hereby acknowledges that if the Secured Creditors elect to nonjudicially
foreclose on any real property security located in the State of California any
right of subrogation of the Guarantor against the Secured Creditors may be
impaired or extinguished and that as a result of such impairment or
extinguishment of subrogation rights, the Guarantor will have a defense to a
deficiency judgment arising out of the operation of (i) Section 580d of the
California Code of Civil Procedure which states that no deficiency may be
recovered on a note secured by a deed of trust on real property in case such
real property is sold under the power of sale contained in such deed of trust,
and (ii) related principles of estoppel. To the fullest extent permitted by law,
the Guarantor waives all rights and benefits and any defense arising out of the
operation of Section 580d of the California Code of Civil Procedure and related
principles of estoppel, even though such election operates to impair or
extinguish any right of reimbursement or subrogation or other right or remedy of
the Guarantor against any Borrower or any other party or any security. In
addition, the Guarantor hereby waives, to the fullest extent permitted by
applicable laws, without limiting the generality of the foregoing or any other
provision hereof, all rights and benefits which might otherwise be available to
the Guarantor under Section 726 of the California Code of Civil Procedure and
all rights and benefits which might otherwise be available to the Guarantor
under California Civil Code Sections 2809, 2810, 2815, 2819, 2821, 2839, 2845,
2848, 2849, 2850, 2899 and 3433.
(d) The Guarantor hereby further waives: (1) all rights and
defenses arising out of an election of remedies by the Secured Creditors, even
though that election of remedies, such as a nonjudicial foreclosure with respect
to security for a Guaranteed Obligation, has destroyed the Guarantor's rights of
subrogation and reimbursement against the principal by the operation of Section
580d of the California Code of Civil Procedure or otherwise; (2) the Guarantor's
rights of subrogation and reimbursement and any other rights and defenses
available to the Guarantor by reason of: (a) California Civil Code Sections 2787
to 2855, inclusive, including, without limitation, (i) any defenses the
Guarantor may have to the Guaranteed Obligations by reason of an election of
remedies by the Secured Creditors and (ii) any rights or defenses the Guarantor
may have by reason of protection afforded to the principal borrower with respect
to the obligation so guaranteed pursuant to the antideficiency or other laws of
the State of
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California limiting or discharging the borrower's indebtedness, including,
without limitation, California Code of Civil Procedure Sections 580a, 580b, 580d
or 726.
11. This Guaranty is a continuing one and all liabilities to
which it applies or may apply under the terms hereof shall be conclusively
presumed to have been created in reliance hereon. No failure or delay on the
part of any Secured Creditor in exercising any right, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein expressly specified are cumulative and not
exclusive of any rights or remedies which any Secured Creditor would otherwise
have. No notice to or demand on the Guarantor in any case shall entitle the
Guarantor to any other further notice or demand in similar or other
circumstances or constitute a waiver of the rights of any Secured Creditor to
any other further action in any circumstances without notice or demand.
12. This Guaranty shall be binding upon the Guarantor and its
successors and assigns and shall inure to the benefit of the Secured Creditors
and their successors and assigns.
13. Neither this Guaranty nor any provision hereof may be
changed, waived, discharged or terminated except with the written consent of the
Required Banks.
14. The Guarantor acknowledges that an executed (or conformed)
copy of the Credit Agreement has been made available to its principal executive
officers and such officers are familiar with the contents thereof.
15. In addition to any rights now or hereafter granted under
applicable law (including, without limitation, Section 151 of the New York
Debtor and Creditor Law) and not by way of limitation of any such rights, upon
the occurrence of an Event of Default or any condition, event, or act which with
notice or lapse of time, or both, would constitute such an Event of Default,
each Secured Creditor is hereby authorized at any time or from time to time with
the prior consent of the Administrative Agent or the Required Banks, without
notice to the Guarantor or to any other Person, any such notice being expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special) and any other Indebtedness at any time held or owing by such Secured
Creditor to or for the credit or the account of the Guarantor, against and on
account of the obligations and liabilities of the Guarantor to such Secured
Creditor under this Guaranty, irrespective of whether or not such Secured
Creditor shall have made any demand hereunder and although said obligations,
liabilities, deposits and claims, or any of them, shall be contingent or
unmatured.
16. All notices, requests, demands or other communications
pursuant hereto shall be deemed to have been duly given or made when delivered
to the Person to which such notice, request, demand or other communication is
required or permitted to be given or made under this Guaranty, addressed to such
party at (i) in the case of any Bank Creditor, as provided in the Credit
Agreement, (ii) in the case of any Interest Rate Protection Creditor, at such
address as such Interest Rate Protection Creditor shall have specified in
writing to the Guarantor and the Administrative Agent and (iii) in the case of
the Guarantor, at its address set forth opposite its
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signature below; or in any case at such other address as any of the Persons
listed above may hereafter notify the others in writing.
17. If claim is ever made upon any Secured Creditor for
repayment or recovery of any amount or amounts received in payment or on account
of any of the Guaranteed Obligations and any of the aforesaid payees repays all
or part of said amount by reason of (a) any judgment, decree or order of any
court or administrative body having jurisdiction over such payee or any of its
property, or (b) any settlement or compromise of any such claim effected by such
payee with any such claimant (including any Borrower), then and in such event
the Guarantor agrees that any such judgment, decree, order, settlement or
compromise shall be binding upon it, notwithstanding any revocation hereof or
the cancellation of any Note or instrument evidencing any liability of any
Borrower, and the Guarantor shall be and remain liable to the aforesaid payees
hereunder for the amount so repaid or recovered to the same extent as if such
amount had never originally been received by any such payee.
18. Any acknowledgment or new promise, whether by payment of
principal or interest or otherwise and whether by any Borrower 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 any
Secured Creditor 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.
19. THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE
SECURED CREDITORS, THE HOLDERS OF THE NOTES AND THE GUARANTOR HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
Any legal action or proceeding with respect to this Guaranty or any other Credit
Document may be brought in the courts of the State of New York or of the United
States for the Southern District of New York, and, by execution and delivery of
this Agreement, the Guarantor hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts. The Guarantor hereby irrevocably designates, appoints and
empowers CT Corporation System, with offices on the date hereof at 1633
Broadway, New York, New York 10019 as its designee, appointee and agent to
receive, accept and acknowledge for and on its behalf, and in respect of its
property, service of any and all legal process, summons, notices and documents
which may be served in any such action or proceeding. If for any reason such
designee, appointee and agent shall cease to be available to act as such, the
Guarantor agrees to designate a new designee, appointee and agent in New York
City on the terms and for the purposes of this provision satisfactory to the
Administrative Agent. The Guarantor further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to the Guarantor at its address set forth opposite its
signature below, such service to become
effective 30 days after such mailing. Nothing herein shall affect the right of
the Administrative Agent, any other Secured Creditor or the holder of any Note
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. The Guarantor hereby irrevocably waives any objection which it may
now or hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with the Guaranty brought in the
courts referred to
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above and hereby further irrevocably waives and agrees not to plead or claim in
any such court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
20. The indebtedness and obligations evidenced hereby are
secured by, among other things, the Holdings Pledge Agreement.
21. All references to Sections are to Sections in this
Guaranty unless otherwise specified.
22. All payments made under the Guaranty shall be made
without setoff, counterclaim or other defense.
23. Notwithstanding anything to the contrary contained in this
Guaranty, the Original Holdings Guaranty continues in full force and effect as
to the guaranteed obligations covered thereby in the event that Section 17 of
the Original Holdings Guaranty becomes applicable.
* * *
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be executed and delivered as of the date first above written.
Address
4 Landmark Square SILGAN HOLDINGS INC.
Suite 400
Stamford, CT 06901
Attention: Harley Rankin, Jr. By /s/ Harley Rankin, Jr.
Title: Executive Vice President,
Chief Financial Officer
and Treasurer
ACCEPTED AND AGREED TO:
BANKERS TRUST COMPANY,
as Administrative Agent for the Banks
By /s/ Dana Klein
Title: Vice President
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