Exhibit 10.8
BancorpSouth
- ------------
UNCONDITIONAL AND CONTINUING GUARANTY (the "GUARANTY") BY: OVERHILL CORP
-------------
(hereinafter the "GUARANTOR")
For good and valuable consideration, the receipt of which is hereby
acknowledged, and to induce BANCORPSOUTH BANK, a Mississippi banking
corporation, its successors, participants, transferees, and assigns, (the
"Bank") to extend or continue to extend credit to and/or otherwise acquire
Obligations owing by TEXAS TIMBERJACK, INC. and its
--------------------------------------------------
successors and assigns, heirs and legal representatives (the "Borrower") and as
a condition precedent thereto, and for the benefit to Guarantor from such
accommodation. Guarantor hereby agrees as follows:
1. Guaranty. Guarantor, regardless of any percentage of ownership or interest
--------
in Borrower by Guarantor, if any, hereby absolutely, continually,
irrevocably, and unconditionally guarantees to Bank the full and prompt
payment when due, whether a maturity, by acceleration, or otherwise (check
appropriate provision): [X] the full amount of all, or, [ ] to the amount
of (_________)Dollars, of the
--------------------------------------
indebtedness, liabilities and obligations of Borrower to Bank of every kind
and nature, whether absolute or contingent or not, due or to become due,
primary or secondary, now existing or hereafter arising, secured or
unsecured created directly or acquired indirectly, and however evidenced by
any instrument(s) that create(s) or constitute(s) obligation(s) of Borrower
to Bank, AND IN ADDITION, all interest thereon and any fees, costs, and
expenses or other amounts provided for under the documentation of such
obligations, any renewals, extensions, modifications, and/or refinances
thereof, and all reasonable fees, costs, and expenses of the Bank's
counsel, incurred in connection with any of the Obligations and/or the
enforcement of this Guaranty, and any post-bankruptcy petition interest and
attorney's fees and any other amounts which Borrower is prohibited or
discharged from paying, or which do not otherwise accrue as part of the
Obligations due to Borrower's discharge (all hereinafter the
"Obligations").
Nothing in this Guaranty is intended to require nor should it be construed
to require the signature of the spouse of any Borrower, if any, in
violation of Regulation B.12 CFR Part 202.7 in connection with this or any
other indebtedness or Obligations of Borrower to Bank.
If limited to a stated amount above, Guarantor agrees:
(a) that any payment made by Guarantor shall only be effective to
reduce the stated limit of liability if accompanied by a written
transmittal document, received by Bank, advising that such
payment is made under this Guaranty for such purpose; and
(b) that Bank may create, renew, refinance, extend, modify or
continue any of the Obligations in excess of said limit and may
apply any sums received on the Obligations from any other source
to payment of the excess, without reducing the liability of
Guarantor hereunder.
2. Unconditional Guaranty. (a) The liability of Guarantor is primary,
----------------------
absolute, unconditional, continuing, complete and irrevocable, and will not
be discharged except by complete and final performance of the Obligations
and no act need occur to establish Guarantor's liability hereunder,
irrespective of, but not limited to:
a. the validity or enforceability of the Obligations or any security
interest, mortgage or pledge granted by Borrower or by any person(s)
secondarily or otherwise liable for any of the Obligations
(hereinafter "Other Obligor(s)"), or any other device providing
Collateral Security for payment of the Obligations, including the
right of setoff against any deposits or credits (hereinafter the
"Collateral Security");
b. the absence of, delay in, or timing of any action by Bank to enforce
or exhaust its remedies under or against the Obligations and/or the
Collateral Security;
c. the waiver or consent by Bank with respect to any provision in the
documentation of the Obligations or the Collateral Security;
d. any action to seek or enforce a judgement against Borrower or any
Other Obligation(s);
e. any interruptions in the business relations of Borrower with Bank, or
whether the Obligations are assumed by or refinanced for any
subsequent borrower;
f. any failure to obtain properly perfect, protect or insure, or any
impairment, deterioration, waste, or loss of any Collateral Security,
regardless of the cause;
g. any other circumstance which might absent the unconditional and
continuing nature of this Guaranty, constitute a defense of a
Guarantor.
h. The liability of Guarantor hereunder shall not be extinguished;
i. with respect to any amount, regardless of when or by whom paid, which
is required to be returned to such Borrower or any trustee or
receiver, by reason of the bankruptcy, insolvency, dissolution, or
death of such Borrower, or for any other reason, all as though such
amount had never been paid.
j. even though Borrower or Other Obligor has any such obligation
discharged in bankruptcy or otherwise by law
k. until complete and final performance of all Obligations of Borrower to
Bank, including the expiration of any and all applicable preference
periods under United States Bankruptcy laws, during which period(s)
payments on the Obligations may be required to be returned to the
payor thereof, or any trustee or other representative.
3. Direct Liability for Obligations. Regardless of any demand from Guarantor,
--------------------------------
if any, Bank shall not be bound to seek payment from or exhaust its
recourse, in whole or in part, against the Borrower, other Guarantors, if
any, or any Other Obligor(s), or upon the Collateral Security, before being
entitled to payment from Guarantor hereunder.
4. Right of Setoff. Bank shall have the right of setoff with respect to
---------------
deposits and credits in favor of Guarantor as it has with respect to
deposits and credits of Borrower.
5. Bank Action or Inaction. Bank at any time, in Bank's sole discretion, and
-----------------------
without the consent of, or notice of Guarantor, and without affecting
Guarantor's liability hereunder:
a. change, alter, modify, renew, continue, increase, refinance, extend
and/or accelerate all or any of the Obligations, or any part(s)
thereof, including the times for performance (whether or not for
longer than any original periods) and/or change or modify the interest
rates, maturities, payments or other terms of an Obligations and/or
the parties thereto, and/or otherwise make changes of any sort
whatsoever in the terms of its documentation with the Borrower or
manner of doing business with the Borrower, and/or with Other
Obligors, or in any other manner whatsoever;
b. make additional advances against, transfer, amend, restate,
substitute, replace, or terminate any existing Obligation and the
documentation therefore;
c. sell, exchange, release, impair, substitute, modify, adjust, or
surrender any of the Collateral Security;
d. take or not take any action as to any or all of the Collateral
Security, apply the proceeds of any Collateral Security sale against
any of the Obligations in any order or sequence or as it deems vest;
or make any election under Section 1111 (b)(2) of the United States
Bankruptcy Code; or establish the priority of any Collateral Security;
e. grant adjustments, forbearances, or indulgences to settle or
compromise with, or sue or not sue any Borrower, or any other
Guarantor, or Other Obligor as to any or all of the Obligations,
and/or subordinate the same or any part thereof to any other
obligations or release or refuse to enforce same; and/or
f. apply all monies received from Borrower or Other Obligors as it deems
best.
6. No Subrogation. No payment by Guarantor or other satisfaction of
--------------
Guarantor's liabilities hereunder shall entitle Guarantor to any payment
from Borrower, from the proceeds of the property of Borrower or from any
Collateral Security, and Guarantor relinquishes all of Guarantor's present
and future claims, rights, and remedies against Borrower, including but not
limited to, the right of contribution, reimbursement, indemnification,
subrogation, exoneration, and any right to participate in any claim or
remedy the Bank may have against the Borrower, or the Collateral Security,
whether such claim or remedy arises in equity, under contract or in law.
7. Waivers. Guarantor expressly waives TRIAL BY JURY per Section 22 and also
-------
waives;
a. acceptance and notice of the acceptance of this Guaranty;
b. diligence, presentment and demand for payment of any of the
Obligations or under this Guaranty;
c. protest, notice of protest, notice of dishonor and/or notice of
nonpayment, acceleration of default of or to Guarantor or to any Other
Obligor;
d. discharge under Section 3-605 of the Uniform Commercial Code, any
amendments thereto, and any and all other defenses based on suretyship
or impairment of collateral;
e. filings of claims or proofs of claim with any court as to which
Borrower or any Other Obligor is subject;
f. the failure of other persons to sign a guaranty, or any documentation
associated with the Obligations;
g. notice of any adverse change in Borrower's financial condition or of
any other fact, if any, which may increase Guarantor's risk; and/or
h. notice of the amount extension of credit from time to time by Bank to
Borrower, the creation, existence, or acquisition of any Obligations
hereby guaranteed, and of notice of the amount of Obligations of
Borrower to Bank from time to time.
Guarantor further waives any and all defenses, claims, and discharges
of Borrower, or of any Other Obilgor, pertaining to the Obligations or
Collateral Security, except the defense of discharge by payment in
full, and Guarantor will not assert, plead, or enforce against Bank
any defense of waiver, failure of consideration, breach of warranty,
lender liability, accord and satisfaction, novation, release, res
judicata, statue of frauds, statute of limitations, fraud, incapacity,
minority, usury, defense based upon manner of Collateral Security
disposition, homestead exemption, valuation, stay or moratorium law,
or unenforceablilty, which may be available to Borrower or any Other
Obligor.
8. Borrower's Financial Condition. Guarantor is aware of the financial
------------------------------
condition of Borrower and delivers this Guaranty based solely upon
independent investigation and not upon any representation of Bank.
Guarantor assumes responsibility for obtaining any initial current,
ongoing, or additional information concerning Borrower's financial
condition as Guarantor may deem necessary, and Guarantor is not relying
upon, not expecting bank to furnish Guarantor with any information
concerning Borrower's financial condition. Guarantor hereby knowingly
accepts the full range of risks incompassed within a contract of "guaranty"
including the possibility that Borrower will contact additional Obligations
for which Guarantor may be liable hereunder after Borrower's financial
condition or ability to pay has deteriorated.
9. Guarantor's Financial Condition. Guarantor covenants that during the time
-------------------------------
this Guaranty is in effect, there will be no material adverse change in
Guarantor's financial status, and Guarantor will not sell, mortgage, pledge
or other wise convey or transfer any material portion of Guarantor's
property, without first obtaining Bank's written consent therefore.
10. Subordination. Guarantor agrees that all of the present and future
-------------
indebtedness of Borrower to Guarantor, if any, shall be and is hereby
subordinated to Bank.
11. Legal Rates of Interest. Nothing contained herein shall be construed to
-----------------------
authorize Bank to charge or collect from Borrower or Guarantor interest
that is not yet accrued, is unearned or subject to rebate, or is otherwise
not entitled to be collected by Bank under applicable law. To the extent
that any performance of this Guaranty would violate any applicable not
entitled to be collected by Bank under applicable law, the obligation to be
fulfilled by Guarantor shall be reduced to the limit legally permitted, so
that this Guaranty shall not require any performance in excess of the limit
legally permitted, but such Obligation shall be fulfilled to the limit of
the legal validity. Any interest paid hereunder for a Borrower who is a
corporation or partnership shall have been contracted for by said
corporation or partnership as Borrower, in accordance with applicable law
as to interest rates that Texas corporations and/or partnerships may
legally contract.
12. Assignments. Bank may assign its rights under this Guarantor without
-----------
Guarantor's consent, and any such assignee shall have the same rights and
remedies as if originally named herein.
13. Breach of Guarantor. In the event of any breach by Guarantor of any
-------------------
provision hereof, the liability of Guarantor hereunder, regardless of the
term(s) of the Obligations with Borrower shall, at Bank's option, be deemed
to have matured, and Bank may take any action necessary to enforce this
Guaranty.
14. No Waiver Rights. No delay or failure on the part of Bank in exercising any
----------------
rights hereunder shall operate as a waiver of such rights, and any notice
or lack of notice on Guarantor shall not be a waiver of the right of Bank
to take further action, with or without notice.
15. Cumulative Remedies. The rights and remedies of Bank hereunder are
-------------------
cumulative and not exclusive of any other rights or remedies provided by
law.
16. Effect of Other Guaranties. This Guaranty does not supersede or cancel any
--------------------------
other guaranties given by Guarantor, or any other Guarantor on behalf of
Borrower, but to the contrary shall be in addition thereto.
17. Reference to Guarantor/Binding Effect. If more than one Guarantor
-------------------------------------
guarantees the Obligation, each and every guaranty shall be the joint and
several undertaking of all such Guarantors. Each reference to Guarantor in
any documents associated with Obligations or in any Guaranty shall be
construed in the singular or plural as the context may require and shall be
deemed to include the heirs, executors, administrators, legal
representatives, successors and assigns of any Guarantor, all of whom shall
be bound for the full payment of the entire amount guaranteed hereby, and
with said Borrower for the payment of the Obligations as if the same were
due or owing by Guarantor as a party thereto, whether furnished to or
executed by Guarantor or not, or whether executed contemporaneously with
this Guaranty or not.
18. Governing Law. This Guaranty shall be governed by the laws of the State of
-------------
Texas, without reference to its conflict of laws principles. If Bank brings
any action hereunder in any courts, state or federal, in Texas Guarantor
consents to and acknowledges personal jurisdiction over Guarantor by such
court, and waives any objection to venue in such court.
19. Severalbilities. If any part of this Guaranty is found invalid, such
---------------
provision shall be inapplicable and deemed omitted, with the remainder of
hereof not invalidated thereby, and still given full force and effect.
20. Circumstances of Executive/Professional Advise Availability. Guarantor
-----------------------------------------------------------
confirms to Bank that Guarantor has either actually consulted or has had
the ability to consult or has knowingly chosen not to consult with an
attorney of Guarantor's own choosing prior to execution of this Guaranty,
therefore Guarantor fully understands and/or assumes total responsibility
for legal consequences of executing this Guaranty, that Guarantor has read
this Guaranty in full, and understands the terms and conditions hereof,
having not relied upon any representations of the Bank as to the nature,
terms, or effect of this Guaranty.
21. Entire Contract. This Guaranty expresses the entire understanding of the
---------------
parties with respect to the subject matter hereof and may not be waived or
varied orally.
22. Waiver of Trial by Jury. GUARANTOR AND BANK WAIVE ANY RIGHT OF TRIAL BY
-----------------------
JURY IN ANY ACTION BY BANK OR BY GUARANTOR IN ANY WAY CONNECTED WITH THIS
GUARANTY, THE OBLIGATION EVIDENCED HEREBY, INCLUDING THOSE OF BORROWER,
UNDER OR ARISING FROM ANY OTHER LOAN DOCUMENTS, THE TRANSACTION(S) RELATED
HERETO, OR THE DEBTOR-CREDITOR RELATIONSHIP CREATED HEREBY.
- --------------------------------------------------------------------------------
NOTICE TO GUARANTOR
You are being asked to guarantee this debt, which are called
"Obligations": in this Guaranty. This includes all future debts of the
Borrower, as well. Think carefully before you sign this Guaranty. If the
Borrower does not pay the debt, you will have to. Be sure you can afford to
pay if you have to, and that you want to accept this responsibility. You
may have to pay up to the full amount of the debt if the Borrower does not
pay. You may have to pay late fees or collection costs. The creditor (Bank)
can collect this debt from you without first trying to collect from the
Borrower. This creditor can use the same collection methods against you
that can be used against the Borrower, such as suing you, garnishing you
wages, etc. If this debt is ever in default, that fact may become a part of
YOUR credit record.
- --------------------------------------------------------------------------------
IN WITNESS WHEREOF, Guarantor has executed and delivered this guaranty
on this the 12/th/ day of APRIL, 2002.
------ ----- ----
Guarantor is a(n) Corporation
-----------
BY:__________________________________ BY: _____________________________
BY: _________________________________ BY: _____________________________