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EXHIBIT 10.3
GUARANTY
(Subsidiary)
Dated as of May 20, 1998
ITCO TIRE COMPANY, a North Carolina corporation (the
"Guarantor"), hereby agrees in favor of BANKBOSTON, N.A., a national banking
association, in its capacity as administrative agent for the financial
institutions party from time to time to the Loan Agreement (as defined below),
as follows:
Section 1. Cross References and Definitions.
(a) Reference is made to the Amended and Restated Loan and
Security Agreement, dated on or about the date hereof (the same as it may
hereafter be amended, modified, supplemented or restated from time to time being
referred to as the "Loan Agreement"), by and among The J.H. Heafner Company,
Inc., a California corporation, Oliver & Winston, Inc., a North Carolina
corporation, ITCO Holding Company, Inc., a North Carolina corporation, The Speed
Merchant, Inc., a California corporation (each a "Borrower" and collectively,
the "Borrowers"), the Lenders parties thereto from time to time, the Co-Agents
and the Agent.
(b) For the purposes of this Guaranty:
"Agent" and "Lender" each have the meaning ascribed
to such term in the Loan Agreement and "Lender" also means and includes
each subsequent holder of a Note.
"Obligor" means any obligor, maker, endorser,
acceptor, surety or guarantor (other than the Guarantor), from time to
time, of any Secured Obligation.
(c) Unless otherwise defined in this Guaranty, terms used
herein which are defined in the Loan Agreement shall have the same meaning
herein as therein ascribed to them.
Section 2. Guaranty.
(a) Guaranty. In consideration of the execution and delivery
by the Lenders of the Loan Agreement and as a condition precedent to the making
of loans and other financial accommodations to the Borrowers by the Lenders
thereunder, the Guarantor, as primary obligor and not as surety merely, hereby
guarantees absolutely and unconditionally to the Agent and the Lenders the due
and punctual payment, when and as due (whether upon demand, at maturity, by
reason of acceleration or otherwise), and performance of all Secured
Obligations, whether now existing or hereafter arising (hereinafter referred to
as the "Guaranteed Obligations"), and agrees to pay any and all expenses
(including, but not limited to, reasonable legal fees and disbursements) which
may be incurred by the Agent or any Lender in enforcing their respective rights
under this Guaranty. The liability of the Guarantor under this Guaranty is
primary, unlimited and unconditional, and shall be enforceable before,
concurrently or after any claim or demand is made or suit is filed against any
Borrower or any other Obligor and before,
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concurrently or after any proceeding by the Agent against any Collateral or
other security for the Guaranteed Obligations and shall be effective regardless
of the solvency or insolvency of any Borrower or any other Obligor at any time,
the extension or modification of any of the Guaranteed Obligations by operation
of law or the subsequent reorganization, merger or consolidation of any Borrower
or any change in its composition, nature, ownership, personnel or location, and
this Guaranty shall be a continuing guaranty of any and all notes given in
extension or renewal of the Guaranteed Obligations. The Guarantor acknowledges,
agrees and confirms that this is a guaranty of payment and not of collection
only and that demand for payment may be made hereunder on any number of
occasions in the amount of all or any portion of the Guaranteed Obligations then
due and no single demand shall exhaust the rights of the Agent or the Lenders
hereunder. Further, the Guarantor hereby agrees that all proceeds of Collateral
owned by it shall be applied to the Secured Obligations on a daily basis as and
when received by the Agent as provided in the Loan Agreement as fully as if such
Collateral and proceeds were owned by the Borrowers.
(b) Payment by Guarantor. If the Borrowers shall fail to pay,
when due and payable, any Guaranteed Obligation, the Guarantor will, without
demand or notice, immediately pay the same to the Agent for the account of the
Lenders. If any Guaranteed Obligation would be subject to acceleration, but such
acceleration is enjoined or stayed, the Guarantor will to the extent permitted
by Applicable Law, purchase such Guaranteed Obligation for a price equal to the
outstanding principal amount thereof, plus such accrued interest and other
amounts as would have been payable had such Guaranteed Obligation been paid or
prepaid at the time of such purchase. All payments by the Guarantor under this
Guaranty shall be made without any setoff, counterclaim or deduction whatsoever,
and in the same currency and funds as are required to be paid by the Borrowers.
(c) Waiver. The Guarantor waives without any requirement of
any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, (i) diligence, presentment, demand, protest and
notice of any kind whatsoever, (ii) any requirement that the Agent or any Lender
exhaust any right or take any action against any Obligor or other Person or any
of the Collateral or other security for the Guaranteed Obligations, (iii) the
benefit of all principles or provisions of Applicable Law which are or might be
in conflict with the terms of this Guaranty, (iv) notice of acceptance hereof,
(v) notice of Default or Event of Default, (vi) notice of any and all favorable
and unfavorable information, financial or other, about the Borrowers, any
Obligor or other Person, heretofore, now or hereafter learned or acquired by the
Agent or any Lender, (vii) all other notice to which such Guarantor or Obligor
might otherwise be entitled, (viii) all defenses, set-offs and counterclaims of
any kind whatsoever (but not the right to bring an independent action), (ix)
notice of the existence or creation of any Guaranteed Obligations, (x) notice of
any alteration, amendment, increase, extension or exchange of any of the
Guaranteed Obligations, (xi) notice of any amendments, modifications or
supplements to the Loan Agreement or any Loan Document, (xii) notice of any
release of Collateral or other security for the Guaranteed Obligations or any
compromise or settlement with respect thereto, (xiii) all diligence in
collection or protection of or realization upon the Collateral
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or any of the Guaranteed Obligations, and (xiv) the right to require the Agent
to proceed against any Obligor.
(d) Consents. The Guarantor consents without the requirement
of any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, that (i) the time of payment of any Guaranteed
Obligation may be extended, (ii) any provision of the Loan Agreement or any Loan
Document may be amended, waived or modified, (iii) any Obligor may be released
from its obligations or other obligors or Guarantor substituted therefor or
added, (iv) any Collateral or other property now or hereafter securing the
Guaranteed Obligations may be released, exchanged, substituted, compromised or
subordinated in whole or in part or any security may be added, and (v) the Agent
may proceed against the Guarantor or any Obligor without proceeding against any
other Obligor.
(e) Guarantor Bound. The Guarantor will remain bound under
this Guaranty notwithstanding any changes, extensions, exchanges, substitutions,
releases, compromises, subordinations, amendments, waivers or modifications or
any other circumstances, whether or not referred to in CLAUSES (c) OR (d) above,
which might otherwise constitute a legal or equitable discharge of a guaranty.
(f) Absolute Obligation. The obligations of the Guarantor
hereunder are irrespective of and shall not be dependent upon or affected by (i)
the validity, legality or enforceability of the Loan Agreement, the Note(s) or
any Loan Document, (ii) the existence, value or condition of any of the
Collateral or other security for the Guaranteed Obligations, (iii) the validity,
perfection or priority of the Security Interest in any of the Collateral or
other security, (iv) any action or failure to take action by the Agent or any
Lender under, or with respect to, the Loan Agreement, the Note(s), any Loan
Document, any Guaranteed Obligation, any Obligor or any of the Collateral or
other security, (v) any other dealings among the Agent, the Lenders, the
Borrowers or any Obligor, or (vi) any present or future law or order of any
government or agency thereof purporting to reduce, amend or otherwise affect any
obligations of the Borrowers or any Guarantor.
(g) Recovery of Payments. In the event that any or all of the
amounts guaranteed by the Guarantor are or were paid by the Borrowers or any
other Obligor or are or were paid or reduced by application of the proceeds of
any Collateral, and all or any part of such payment is recovered from the Agent
or any Lender under any applicable bankruptcy or insolvency law or otherwise,
the liability of the Guarantor under this Guaranty shall continue and remain in
full force and effect to the extent permitted by Applicable Law.
(h) Waiver of Reimbursement, Subrogation. The Guarantor hereby
waives, to the fullest extent permitted by Applicable Law, any and all rights of
subrogation, indemnification, reimbursement, contribution or similar rights
which the Guarantor may have against the Borrowers or any Obligor or any
Collateral, other security or otherwise until all Secured Obligations have been
paid in full. The provisions of this SUBSECTION (h) shall survive the
termination of this Guaranty.
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(i) Binding Nature of Certain Adjudications. Upon written
notice of the institution by the Agent or any Lender of any action or
proceedings, legal or otherwise, for the adjudication of any controversy with
the Borrowers, the Guarantor will be conclusively bound by the adjudication in
any such action or proceedings and by a judgment, award or decree entered
therein. The Guarantor waives the right to assert in any action or proceeding
brought by the Agent or any Lender, upon the Loan Agreement, the Note(s) or any
Loan Document, any offsets or counterclaims which such Guarantor may have with
respect thereto (other than (subject to SECTION 2(g)) payment of the Secured
Obligations).
(j) Validity and Enforceability of Guaranty. The Guarantor
will take all action required so that the guaranty contained herein will at all
times be a binding obligation of the Guarantor enforceable in accordance with
its terms.
Section 3. Representations and Warranties. The Guarantor
represents and warrants to the Agent and the Lenders as follows:
(a) Organization; Power; Qualification. The Guarantor is a
corporation, duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, has the power and authority to own
its properties and to carry on its business as now being and hereafter proposed
to be conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization.
(b) Authorization of Guaranty. The Guarantor has the right and
power and has taken all necessary action to authorize it to guarantee the
Guaranteed Obligations hereunder and to execute, deliver and perform this
Guaranty in accordance with its terms. This Guaranty has been duly executed and
delivered by the duly authorized officers of the Guarantor and is a legal, valid
and binding obligation of the Guarantor enforceable in accordance with its
terms.
(c) Compliance of Guaranty With Laws, Etc. The execution,
delivery and performance of this Guaranty in accordance with its terms and the
guaranty of the Guaranteed Obligations hereunder do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Government
Approval or violate any Applicable Law relating to the Guarantor, (ii) conflict
with, result in a breach of or constitute a default under (A) the articles of
incorporation or by-laws of the Guarantor, (B) any material provisions of any
indenture, agreement or other instrument to which the Guarantor is a party or by
which it or any of its properties may be bound or (C) any Governmental Approval,
or (iii) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by the Guarantor,
except Liens created pursuant to the Loan Documents.
(d) Financial Interest. The Guarantor is a Wholly Owned
Subsidiary of The J.H. Heafner Company and is engaged in a related and mutually
interdependent business with the Borrowers and will derive indirect financial
and business advantages and benefits from the Loans and other financial
accommodations that the Lenders may make to the Borrowers
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Section 4. Litigation. THE GUARANTOR, THE AGENT AND EACH
LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN
ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION
MAY BE COMMENCED BY OR AGAINST THE GUARANTOR ARISING OUT OF THIS GUARANTY OR OUT
OF THE GUARANTOR'S SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT AMONG OR
BETWEEN THE GUARANTOR, ANY LENDER AND THE AGENT, OR BY REASON OF ANY OTHER CAUSE
OR DISPUTE WHATSOEVER BETWEEN THE GUARANTOR AND THE AGENT OR ANY LENDER OF ANY
KIND OR NATURE. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY AGREE THAT THE
SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM ANY THEREOF, SHALL HAVE NONEXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE GUARANTOR AND THE AGENT OR SUCH
LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY OR THE LOAN DOCUMENTS
OR TO ANY MATTER ARISING THEREFROM. THE GUARANTOR EXPRESSLY SUBMITS AND CONSENTS
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH
COURTS, HEREBY WAIVING PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER
PROCESS OR PAPERS ISSUED THEREIN AND AGREEING THAT SERVICE OF SUCH SUMMONS AND
COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO THE GUARANTOR AT THE ADDRESS OF THE GUARANTOR SET FORTH HEREIN. THE
NONEXCLUSIVE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO
PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF
ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
Section 5. Right of Setoff. Upon the occurrence and during the
continuation of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender to or for the credit or the account of the Guarantor against any and all
of the Guaranteed Obligations now or hereafter existing, whether or not demand
shall have been made under this Guaranty and although such Guaranteed
Obligations may be contingent and unmatured. Each Lender agrees promptly to
notify the Guarantor after any such setoff and application made by such Lender,
provided that the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under this Section are in
addition to any other rights and remedies (including, without limitation, other
rights of setoff) which such Lender may have.
Section 6. Titles and Captions. Titles and captions of
Sections and subsections in this Guaranty are for convenience only, and neither
limit nor amplify the provisions of this Guaranty.
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Section 7. Severability of Provisions. Any provision of this
Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 8. Governing Law. This Guaranty shall be construed in
accordance with and governed by the law of the State of New York, without regard
to principles of conflicts of laws.
Section 9. Counterparts. This Guaranty may be executed in any
number of counterparts, each of which shall be deemed to be an original and
shall be binding upon all parties, their successors and assigns.
Section 10. Miscellaneous. This Guaranty and the other
agreements contemplated by this Guaranty supersede all prior negotiations,
agreements and understandings, and constitute the entire agreement between the
parties with respect to the subject matter thereof. All the provisions of this
Guaranty shall be binding upon the Guarantor and its successors and assigns, and
each Lender may assign or transfer any of its rights under this Guaranty in
connection with the transfer of its interests under the Loan Agreement in
accordance with the terms thereof. Any term, covenant, agreement or condition of
this Guaranty may be amended or waived, and any departure therefrom may be
consented to, if, but only if, such amendment, waiver or consent is in writing
and is signed by the Agent and the Required Lenders and, in the case of any
amendment, also by the Guarantor. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
instance and for the specific purpose for which given and no waiver of any
condition, or of the breach of any term, provision, warranty, representation,
agreement or covenant contained in this Guaranty, whether by conduct or
otherwise, in any one or more instances shall be deemed or construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of the breach of any other term, provision, warranty,
representation, agreement or covenant contained in this Guaranty. The failure of
the Agent or any Lender at any time or times to require performance of any
provisions of this Guaranty shall in no manner affect the right to enforce the
same. Whenever the context so requires, the singular number shall include the
plural and the plural shall include the singular, and the gender of any pronoun
shall include the other genders.
Section 11. Notices. All notices and other communications
provided for hereunder shall be in writing and given in accordance with the
provisions of SECTION 15.1 of the Loan Agreement and such provisions are hereby
incorporated herein by this reference as if fully set forth herein. The address
of the Guarantor for such purposes shall be as set forth on the signature page
hereof, or such other address notice of which is given in accordance with the
provisions hereof, and the address of the Lenders shall be as provided from time
to time pursuant to SECTION 15.1 of the Loan Agreement. The Guarantor agrees
that if any notification of intended disposition of Collateral or other security
for the Guaranteed Obligations or of any other act by the Agent or any Lender is
required by law and a specific time period is not stated therein, such
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notification given in accordance with the provisions of this SECTION 11, at
least ten (10) days prior to such disposition or act shall be deemed reasonable
and properly given.
Section 12. Limitation on Guaranteed Obligations. The
obligations of the Guarantor hereunder shall be limited to an aggregate amount
that is equal to the largest amount that would not render the obligations of the
Guarantor hereunder subject to avoidance under Section 548 of the United States
Bankruptcy Code (Title 11 of the United States Code) or any comparable provision
of Applicable Law.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be executed by its duly authorized officer(s) as of the day and year first
written above.
[Corporate Seal] ITCO TIRE COMPANY
By: /s/ WILLIAM H. GAITHER
Name:________________________
Title:_______________________
Address:
2708 Commerce Road
P.O. Box 641
Wilson, North Carolina 27893
Attest: /s/ J. MICHAEL GAITHER
Name:___________________
Title:__________________
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GUARANTY
(Subsidiary)
Dated as of May 20, 1998
ITCO TIRE COMPANY OF GEORGIA, a Virginia corporation (the
"Guarantor"), hereby agrees in favor of BANKBOSTON, N.A., a national banking
association, in its capacity as administrative agent for the financial
institutions party from time to time to the Loan Agreement (as defined below),
as follows:
Section 1. Cross References and Definitions.
(a) Reference is made to the Amended and Restated Loan and
Security Agreement, dated on or about the date hereof (the same as it may
hereafter be amended, modified, supplemented or restated from time to time being
referred to as the "Loan Agreement"), by and among The J.H. Heafner Company,
Inc., a California corporation, Oliver & Winston, Inc., a North Carolina
corporation, ITCO Holding Company, Inc., a North Carolina corporation, The Speed
Merchant, Inc., a California corporation (each a "Borrower" and collectively,
the "Borrowers"), the Lenders parties thereto from time to time, the Co-Agents
and the Agent.
(b) For the purposes of this Guaranty:
"Agent" and "Lender" each have the meaning ascribed
to such term in the Loan Agreement and "Lender" also means and includes
each subsequent holder of a Note.
"Obligor" means any obligor, maker, endorser,
acceptor, surety or guarantor (other than the Guarantor), from time to
time, of any Secured Obligation.
(c) Unless otherwise defined in this Guaranty, terms used
herein which are defined in the Loan Agreement shall have the same meaning
herein as therein ascribed to them.
Section 2. Guaranty.
(a) Guaranty. In consideration of the execution and delivery
by the Lenders of the Loan Agreement and as a condition precedent to the making
of loans and other financial accommodations to the Borrowers by the Lenders
thereunder, the Guarantor, as primary obligor and not as surety merely, hereby
guarantees absolutely and unconditionally to the Agent and the Lenders the due
and punctual payment, when and as due (whether upon demand, at maturity, by
reason of acceleration or otherwise), and performance of all Secured
Obligations, whether now existing or hereafter arising (hereinafter referred to
as the "Guaranteed Obligations"), and agrees to pay any and all expenses
(including, but not limited to, reasonable legal fees and disbursements) which
may be incurred by the Agent or any Lender in enforcing their respective rights
under this Guaranty. The liability of the Guarantor under this Guaranty is
primary, unlimited and unconditional, and shall be enforceable before,
concurrently or after any claim or demand is made or suit is filed against any
Borrower or any other Obligor and before,
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concurrently or after any proceeding by the Agent against any Collateral or
other security for the Guaranteed Obligations and shall be effective regardless
of the solvency or insolvency of any Borrower or any other Obligor at any time,
the extension or modification of any of the Guaranteed Obligations by operation
of law or the subsequent reorganization, merger or consolidation of any Borrower
or any change in its composition, nature, ownership, personnel or location, and
this Guaranty shall be a continuing guaranty of any and all notes given in
extension or renewal of the Guaranteed Obligations. The Guarantor acknowledges,
agrees and confirms that this is a guaranty of payment and not of collection
only and that demand for payment may be made hereunder on any number of
occasions in the amount of all or any portion of the Guaranteed Obligations then
due and no single demand shall exhaust the rights of the Agent or the Lenders
hereunder. Further, the Guarantor hereby agrees that all proceeds of Collateral
owned by it shall be applied to the Secured Obligations on a daily basis as and
when received by the Agent as provided in the Loan Agreement as fully as if such
Collateral and proceeds were owned by the Borrowers.
(b) Payment by Guarantor. If the Borrowers shall fail to pay,
when due and payable, any Guaranteed Obligation, the Guarantor will, without
demand or notice, immediately pay the same to the Agent for the account of the
Lenders. If any Guaranteed Obligation would be subject to acceleration, but such
acceleration is enjoined or stayed, the Guarantor will to the extent permitted
by Applicable Law, purchase such Guaranteed Obligation for a price equal to the
outstanding principal amount thereof, plus such accrued interest and other
amounts as would have been payable had such Guaranteed Obligation been paid or
prepaid at the time of such purchase. All payments by the Guarantor under this
Guaranty shall be made without any setoff, counterclaim or deduction whatsoever,
and in the same currency and funds as are required to be paid by the Borrowers.
(c) Waiver. The Guarantor waives without any requirement of
any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, (i) diligence, presentment, demand, protest and
notice of any kind whatsoever, (ii) any requirement that the Agent or any Lender
exhaust any right or take any action against any Obligor or other Person or any
of the Collateral or other security for the Guaranteed Obligations, (iii) the
benefit of all principles or provisions of Applicable Law which are or might be
in conflict with the terms of this Guaranty, (iv) notice of acceptance hereof,
(v) notice of Default or Event of Default, (vi) notice of any and all favorable
and unfavorable information, financial or other, about the Borrowers, any
Obligor or other Person, heretofore, now or hereafter learned or acquired by the
Agent or any Lender, (vii) all other notice to which such Guarantor or Obligor
might otherwise be entitled, (viii) all defenses, set-offs and counterclaims of
any kind whatsoever (but not the right to bring an independent action), (ix)
notice of the existence or creation of any Guaranteed Obligations, (x) notice of
any alteration, amendment, increase, extension or exchange of any of the
Guaranteed Obligations, (xi) notice of any amendments, modifications or
supplements to the Loan Agreement or any Loan Document, (xii) notice of any
release of Collateral or other security for the Guaranteed Obligations or any
compromise or settlement with respect thereto, (xiii) all diligence in
collection or protection of or realization upon the Collateral
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or any of the Guaranteed Obligations, and (xiv) the right to require the Agent
to proceed against any Obligor.
(d) Consents. The Guarantor consents without the requirement
of any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, that (i) the time of payment of any Guaranteed
Obligation may be extended, (ii) any provision of the Loan Agreement or any Loan
Document may be amended, waived or modified, (iii) any Obligor may be released
from its obligations or other obligors or Guarantor substituted therefor or
added, (iv) any Collateral or other property now or hereafter securing the
Guaranteed Obligations may be released, exchanged, substituted, compromised or
subordinated in whole or in part or any security may be added, and (v) the Agent
may proceed against the Guarantor or any Obligor without proceeding against any
other Obligor.
(e) Guarantor Bound. The Guarantor will remain bound under
this Guaranty notwithstanding any changes, extensions, exchanges, substitutions,
releases, compromises, subordinations, amendments, waivers or modifications or
any other circumstances, whether or not referred to in CLAUSES (c) OR (d) above,
which might otherwise constitute a legal or equitable discharge of a guaranty.
(f) Absolute Obligation. The obligations of the Guarantor
hereunder are irrespective of and shall not be dependent upon or affected by (i)
the validity, legality or enforceability of the Loan Agreement, the Note(s) or
any Loan Document, (ii) the existence, value or condition of any of the
Collateral or other security for the Guaranteed Obligations, (iii) the validity,
perfection or priority of the Security Interest in any of the Collateral or
other security, (iv) any action or failure to take action by the Agent or any
Lender under, or with respect to, the Loan Agreement, the Note(s), any Loan
Document, any Guaranteed Obligation, any Obligor or any of the Collateral or
other security, (v) any other dealings among the Agent, the Lenders, the
Borrowers or any Obligor, or (vi) any present or future law or order of any
government or agency thereof purporting to reduce, amend or otherwise affect any
obligations of the Borrowers or any Guarantor.
(g) Recovery of Payments. In the event that any or all of the
amounts guaranteed by the Guarantor are or were paid by the Borrowers or any
other Obligor or are or were paid or reduced by application of the proceeds of
any Collateral, and all or any part of such payment is recovered from the Agent
or any Lender under any applicable bankruptcy or insolvency law or otherwise,
the liability of the Guarantor under this Guaranty shall continue and remain in
full force and effect to the extent permitted by Applicable Law.
(h) Waiver of Reimbursement, Subrogation. The Guarantor hereby
waives, to the fullest extent permitted by Applicable Law, any and all rights of
subrogation, indemnification, reimbursement, contribution or similar rights
which the Guarantor may have against the Borrowers or any Obligor or any
Collateral, other security or otherwise until all Secured Obligations have been
paid in full. The provisions of this SUBSECTION (h) shall survive the
termination of this Guaranty.
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(i) Binding Nature of Certain Adjudications. Upon written
notice of the institution by the Agent or any Lender of any action or
proceedings, legal or otherwise, for the adjudication of any controversy with
the Borrowers, the Guarantor will be conclusively bound by the adjudication in
any such action or proceedings and by a judgment, award or decree entered
therein. The Guarantor waives the right to assert in any action or proceeding
brought by the Agent or any Lender, upon the Loan Agreement, the Note(s) or any
Loan Document, any offsets or counterclaims which such Guarantor may have with
respect thereto (other than (subject to SECTION 2(g)) payment of the Secured
Obligations).
(j) Validity and Enforceability of Guaranty. The Guarantor
will take all action required so that the guaranty contained herein will at all
times be a binding obligation of the Guarantor enforceable in accordance with
its terms.
Section 3. Representations and Warranties. The Guarantor
represents and warrants to the Agent and the Lenders as follows:
(a) Organization; Power; Qualification. The Guarantor is a
corporation, duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, has the power and authority to own
its properties and to carry on its business as now being and hereafter proposed
to be conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization.
(b) Authorization of Guaranty. The Guarantor has the right and
power and has taken all necessary action to authorize it to guarantee the
Guaranteed Obligations hereunder and to execute, deliver and perform this
Guaranty in accordance with its terms. This Guaranty has been duly executed and
delivered by the duly authorized officers of the Guarantor and is a legal, valid
and binding obligation of the Guarantor enforceable in accordance with its
terms.
(c) Compliance of Guaranty With Laws, Etc. The execution,
delivery and performance of this Guaranty in accordance with its terms and the
guaranty of the Guaranteed Obligations hereunder do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Government
Approval or violate any Applicable Law relating to the Guarantor, (ii) conflict
with, result in a breach of or constitute a default under (A) the articles of
incorporation or by-laws of the Guarantor, (B) any material provisions of any
indenture, agreement or other instrument to which the Guarantor is a party or by
which it or any of its properties may be bound or (C) any Governmental Approval,
or (iii) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by the Guarantor,
except Liens created pursuant to the Loan Documents.
(d) Financial Interest. The Guarantor is a Wholly Owned
Subsidiary of The J.H. Heafner Company and is engaged in a related and mutually
interdependent business with the Borrowers and will derive indirect financial
and business advantages and benefits from the Loans and other financial
accommodations that the Lenders may make to the Borrowers
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13
Section 4. Litigation. THE GUARANTOR, THE AGENT AND EACH
LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN
ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION
MAY BE COMMENCED BY OR AGAINST THE GUARANTOR ARISING OUT OF THIS GUARANTY OR OUT
OF THE GUARANTOR'S SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT AMONG OR
BETWEEN THE GUARANTOR, ANY LENDER AND THE AGENT, OR BY REASON OF ANY OTHER CAUSE
OR DISPUTE WHATSOEVER BETWEEN THE GUARANTOR AND THE AGENT OR ANY LENDER OF ANY
KIND OR NATURE. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY AGREE THAT THE
SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM ANY THEREOF, SHALL HAVE NONEXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE GUARANTOR AND THE AGENT OR SUCH
LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY OR THE LOAN DOCUMENTS
OR TO ANY MATTER ARISING THEREFROM. THE GUARANTOR EXPRESSLY SUBMITS AND CONSENTS
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH
COURTS, HEREBY WAIVING PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER
PROCESS OR PAPERS ISSUED THEREIN AND AGREEING THAT SERVICE OF SUCH SUMMONS AND
COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO THE GUARANTOR AT THE ADDRESS OF THE GUARANTOR SET FORTH HEREIN. THE
NONEXCLUSIVE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO
PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF
ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
Section 5. Right of Setoff. Upon the occurrence and during the
continuation of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender to or for the credit or the account of the Guarantor against any and all
of the Guaranteed Obligations now or hereafter existing, whether or not demand
shall have been made under this Guaranty and although such Guaranteed
Obligations may be contingent and unmatured. Each Lender agrees promptly to
notify the Guarantor after any such setoff and application made by such Lender,
provided that the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under this Section are in
addition to any other rights and remedies (including, without limitation, other
rights of setoff) which such Lender may have.
Section 6. Titles and Captions. Titles and captions of
Sections and subsections in this Guaranty are for convenience only, and neither
limit nor amplify the provisions of this Guaranty.
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Section 7. Severability of Provisions. Any provision of this
Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 8. Governing Law. This Guaranty shall be construed in
accordance with and governed by the law of the State of New York, without regard
to principles of conflicts of laws.
Section 9. Counterparts. This Guaranty may be executed in any
number of counterparts, each of which shall be deemed to be an original and
shall be binding upon all parties, their successors and assigns.
Section 10. Miscellaneous. This Guaranty and the other
agreements contemplated by this Guaranty supersede all prior negotiations,
agreements and understandings, and constitute the entire agreement between the
parties with respect to the subject matter thereof. All the provisions of this
Guaranty shall be binding upon the Guarantor and its successors and assigns, and
each Lender may assign or transfer any of its rights under this Guaranty in
connection with the transfer of its interests under the Loan Agreement in
accordance with the terms thereof. Any term, covenant, agreement or condition of
this Guaranty may be amended or waived, and any departure therefrom may be
consented to, if, but only if, such amendment, waiver or consent is in writing
and is signed by the Agent and the Required Lenders and, in the case of any
amendment, also by the Guarantor. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
instance and for the specific purpose for which given and no waiver of any
condition, or of the breach of any term, provision, warranty, representation,
agreement or covenant contained in this Guaranty, whether by conduct or
otherwise, in any one or more instances shall be deemed or construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of the breach of any other term, provision, warranty,
representation, agreement or covenant contained in this Guaranty. The failure of
the Agent or any Lender at any time or times to require performance of any
provisions of this Guaranty shall in no manner affect the right to enforce the
same. Whenever the context so requires, the singular number shall include the
plural and the plural shall include the singular, and the gender of any pronoun
shall include the other genders.
Section 11. Notices. All notices and other communications
provided for hereunder shall be in writing and given in accordance with the
provisions of SECTION 15.1 of the Loan Agreement and such provisions are hereby
incorporated herein by this reference as if fully set forth herein. The address
of the Guarantor for such purposes shall be as set forth on the signature page
hereof, or such other address notice of which is given in accordance with the
provisions hereof, and the address of the Lenders shall be as provided from time
to time pursuant to SECTION 15.1 of the Loan Agreement. The Guarantor agrees
that if any notification of intended disposition of Collateral or other security
for the Guaranteed Obligations or of any other act by the Agent or any Lender is
required by law and a specific time period is not stated therein, such
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15
notification given in accordance with the provisions of this SECTION 11, at
least ten (10) days prior to such disposition or act shall be deemed reasonable
and properly given.
Section 12. Limitation on Guaranteed Obligations. The
obligations of the Guarantor hereunder shall be limited to an aggregate amount
that is equal to the largest amount that would not render the obligations of the
Guarantor hereunder subject to avoidance under Section 548 of the United States
Bankruptcy Code (Title 11 of the United States Code) or any comparable provision
of Applicable Law.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be executed by its duly authorized officer(s) as of the day and year first
written above.
[Corporate Seal] ITCO TIRE COMPANY OF GEORGIA
By: /s/ WILLIAM H. GAITHER
Name:________________________
Title:_______________________
Address:
2708 Commerce Road
P.O. Box 641
Wilson, North Carolina 27893
Attest: /s/ J. MICHAEL GAITHER
Name:___________________
Title:__________________
8
17
GUARANTY
(Subsidiary)
Dated as of May 20, 1998
ITCO LOGISTICS CORPORATION, a Delaware corporation (the
"Guarantor"), hereby agrees in favor of BANKBOSTON, N.A., a national banking
association, in its capacity as administrative agent for the financial
institutions party from time to time to the Loan Agreement (as defined below),
as follows:
Section 1. Cross References and Definitions.
(a) Reference is made to the Amended and Restated Loan and
Security Agreement, dated on or about the date hereof (the same as it may
hereafter be amended, modified, supplemented or restated from time to time being
referred to as the "Loan Agreement"), by and among The J.H. Heafner Company,
Inc., a California corporation, Oliver & Winston, Inc., a North Carolina
corporation, ITCO Holding Company, Inc., a North Carolina corporation, The Speed
Merchant, Inc., a California corporation (each a "Borrower" and collectively,
the "Borrowers"), the Lenders parties thereto from time to time, the Co-Agents
and the Agent.
(b) For the purposes of this Guaranty:
"Agent" and "Lender" each have the meaning ascribed
to such term in the Loan Agreement and "Lender" also means and includes
each subsequent holder of a Note.
"Obligor" means any obligor, maker, endorser,
acceptor, surety or guarantor (other than the Guarantor), from time to
time, of any Secured Obligation.
(c) Unless otherwise defined in this Guaranty, terms used
herein which are defined in the Loan Agreement shall have the same meaning
herein as therein ascribed to them.
Section 2. Guaranty.
(a) Guaranty. In consideration of the execution and delivery
by the Lenders of the Loan Agreement and as a condition precedent to the making
of loans and other financial accommodations to the Borrowers by the Lenders
thereunder, the Guarantor, as primary obligor and not as surety merely, hereby
guarantees absolutely and unconditionally to the Agent and the Lenders the due
and punctual payment, when and as due (whether upon demand, at maturity, by
reason of acceleration or otherwise), and performance of all Secured
Obligations, whether now existing or hereafter arising (hereinafter referred to
as the "Guaranteed Obligations"), and agrees to pay any and all expenses
(including, but not limited to, reasonable legal fees and disbursements) which
may be incurred by the Agent or any Lender in enforcing their respective rights
under this Guaranty. The liability of the Guarantor under this Guaranty is
primary, unlimited and unconditional, and shall be enforceable before,
concurrently or after any claim or demand is made or suit is filed against any
Borrower or any other Obligor and before,
18
concurrently or after any proceeding by the Agent against any Collateral or
other security for the Guaranteed Obligations and shall be effective regardless
of the solvency or insolvency of any Borrower or any other Obligor at any time,
the extension or modification of any of the Guaranteed Obligations by operation
of law or the subsequent reorganization, merger or consolidation of any Borrower
or any change in its composition, nature, ownership, personnel or location, and
this Guaranty shall be a continuing guaranty of any and all notes given in
extension or renewal of the Guaranteed Obligations. The Guarantor acknowledges,
agrees and confirms that this is a guaranty of payment and not of collection
only and that demand for payment may be made hereunder on any number of
occasions in the amount of all or any portion of the Guaranteed Obligations then
due and no single demand shall exhaust the rights of the Agent or the Lenders
hereunder. Further, the Guarantor hereby agrees that all proceeds of Collateral
owned by it shall be applied to the Secured Obligations on a daily basis as and
when received by the Agent as provided in the Loan Agreement as fully as if such
Collateral and proceeds were owned by the Borrowers.
(b) Payment by Guarantor. If the Borrowers shall fail to pay,
when due and payable, any Guaranteed Obligation, the Guarantor will, without
demand or notice, immediately pay the same to the Agent for the account of the
Lenders. If any Guaranteed Obligation would be subject to acceleration, but such
acceleration is enjoined or stayed, the Guarantor will to the extent permitted
by Applicable Law, purchase such Guaranteed Obligation for a price equal to the
outstanding principal amount thereof, plus such accrued interest and other
amounts as would have been payable had such Guaranteed Obligation been paid or
prepaid at the time of such purchase. All payments by the Guarantor under this
Guaranty shall be made without any setoff, counterclaim or deduction whatsoever,
and in the same currency and funds as are required to be paid by the Borrowers.
(c) Waiver. The Guarantor waives without any requirement of
any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, (i) diligence, presentment, demand, protest and
notice of any kind whatsoever, (ii) any requirement that the Agent or any Lender
exhaust any right or take any action against any Obligor or other Person or any
of the Collateral or other security for the Guaranteed Obligations, (iii) the
benefit of all principles or provisions of Applicable Law which are or might be
in conflict with the terms of this Guaranty, (iv) notice of acceptance hereof,
(v) notice of Default or Event of Default, (vi) notice of any and all favorable
and unfavorable information, financial or other, about the Borrowers, any
Obligor or other Person, heretofore, now or hereafter learned or acquired by the
Agent or any Lender, (vii) all other notice to which such Guarantor or Obligor
might otherwise be entitled, (viii) all defenses, set-offs and counterclaims of
any kind whatsoever (but not the right to bring an independent action), (ix)
notice of the existence or creation of any Guaranteed Obligations, (x) notice of
any alteration, amendment, increase, extension or exchange of any of the
Guaranteed Obligations, (xi) notice of any amendments, modifications or
supplements to the Loan Agreement or any Loan Document, (xii) notice of any
release of Collateral or other security for the Guaranteed Obligations or any
compromise or settlement with respect thereto, (xiii) all diligence in
collection or protection of or realization upon the Collateral
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19
or any of the Guaranteed Obligations, and (xiv) the right to require the Agent
to proceed against any Obligor.
(d) Consents. The Guarantor consents without the requirement
of any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, that (i) the time of payment of any Guaranteed
Obligation may be extended, (ii) any provision of the Loan Agreement or any Loan
Document may be amended, waived or modified, (iii) any Obligor may be released
from its obligations or other obligors or Guarantor substituted therefor or
added, (iv) any Collateral or other property now or hereafter securing the
Guaranteed Obligations may be released, exchanged, substituted, compromised or
subordinated in whole or in part or any security may be added, and (v) the Agent
may proceed against the Guarantor or any Obligor without proceeding against any
other Obligor.
(e) Guarantor Bound. The Guarantor will remain bound under
this Guaranty notwithstanding any changes, extensions, exchanges, substitutions,
releases, compromises, subordinations, amendments, waivers or modifications or
any other circumstances, whether or not referred to in CLAUSES (c) OR (d) above,
which might otherwise constitute a legal or equitable discharge of a guaranty.
(f) Absolute Obligation. The obligations of the Guarantor
hereunder are irrespective of and shall not be dependent upon or affected by (i)
the validity, legality or enforceability of the Loan Agreement, the Note(s) or
any Loan Document, (ii) the existence, value or condition of any of the
Collateral or other security for the Guaranteed Obligations, (iii) the validity,
perfection or priority of the Security Interest in any of the Collateral or
other security, (iv) any action or failure to take action by the Agent or any
Lender under, or with respect to, the Loan Agreement, the Note(s), any Loan
Document, any Guaranteed Obligation, any Obligor or any of the Collateral or
other security, (v) any other dealings among the Agent, the Lenders, the
Borrowers or any Obligor, or (vi) any present or future law or order of any
government or agency thereof purporting to reduce, amend or otherwise affect any
obligations of the Borrowers or any Guarantor.
(g) Recovery of Payments. In the event that any or all of the
amounts guaranteed by the Guarantor are or were paid by the Borrowers or any
other Obligor or are or were paid or reduced by application of the proceeds of
any Collateral, and all or any part of such payment is recovered from the Agent
or any Lender under any applicable bankruptcy or insolvency law or otherwise,
the liability of the Guarantor under this Guaranty shall continue and remain in
full force and effect to the extent permitted by Applicable Law.
(h) Waiver of Reimbursement, Subrogation. The Guarantor hereby
waives, to the fullest extent permitted by Applicable Law, any and all rights of
subrogation, indemnification, reimbursement, contribution or similar rights
which the Guarantor may have against the Borrowers or any Obligor or any
Collateral, other security or otherwise until all Secured Obligations have been
paid in full. The provisions of this SUBSECTION (h) shall survive the
termination of this Guaranty.
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20
(i) Binding Nature of Certain Adjudications. Upon written
notice of the institution by the Agent or any Lender of any action or
proceedings, legal or otherwise, for the adjudication of any controversy with
the Borrowers, the Guarantor will be conclusively bound by the adjudication in
any such action or proceedings and by a judgment, award or decree entered
therein. The Guarantor waives the right to assert in any action or proceeding
brought by the Agent or any Lender, upon the Loan Agreement, the Note(s) or any
Loan Document, any offsets or counterclaims which such Guarantor may have with
respect thereto (other than (subject to SECTION 2(g)) payment of the Secured
Obligations).
(j) Validity and Enforceability of Guaranty. The Guarantor
will take all action required so that the guaranty contained herein will at all
times be a binding obligation of the Guarantor enforceable in accordance with
its terms.
Section 3. Representations and Warranties. The Guarantor
represents and warrants to the Agent and the Lenders as follows:
(a) Organization; Power; Qualification. The Guarantor is a
corporation, duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, has the power and authority to own
its properties and to carry on its business as now being and hereafter proposed
to be conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization.
(b) Authorization of Guaranty. The Guarantor has the right and
power and has taken all necessary action to authorize it to guarantee the
Guaranteed Obligations hereunder and to execute, deliver and perform this
Guaranty in accordance with its terms. This Guaranty has been duly executed and
delivered by the duly authorized officers of the Guarantor and is a legal, valid
and binding obligation of the Guarantor enforceable in accordance with its
terms.
(c) Compliance of Guaranty With Laws, Etc. The execution,
delivery and performance of this Guaranty in accordance with its terms and the
guaranty of the Guaranteed Obligations hereunder do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Government
Approval or violate any Applicable Law relating to the Guarantor, (ii) conflict
with, result in a breach of or constitute a default under (A) the articles of
incorporation or by-laws of the Guarantor, (B) any material provisions of any
indenture, agreement or other instrument to which the Guarantor is a party or by
which it or any of its properties may be bound or (C) any Governmental Approval,
or (iii) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by the Guarantor,
except Liens created pursuant to the Loan Documents.
(d) Financial Interest. The Guarantor is a Wholly Owned
Subsidiary of The J.H. Heafner Company and is engaged in a related and mutually
interdependent business with the Borrowers and will derive indirect financial
and business advantages and benefits from the Loans and other financial
accommodations that the Lenders may make to the Borrowers
4
21
Section 4. Litigation. THE GUARANTOR, THE AGENT AND EACH
LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN
ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION
MAY BE COMMENCED BY OR AGAINST THE GUARANTOR ARISING OUT OF THIS GUARANTY OR OUT
OF THE GUARANTOR'S SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT AMONG OR
BETWEEN THE GUARANTOR, ANY LENDER AND THE AGENT, OR BY REASON OF ANY OTHER CAUSE
OR DISPUTE WHATSOEVER BETWEEN THE GUARANTOR AND THE AGENT OR ANY LENDER OF ANY
KIND OR NATURE. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY AGREE THAT THE
SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM ANY THEREOF, SHALL HAVE NONEXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE GUARANTOR AND THE AGENT OR SUCH
LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY OR THE LOAN DOCUMENTS
OR TO ANY MATTER ARISING THEREFROM. THE GUARANTOR EXPRESSLY SUBMITS AND CONSENTS
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH
COURTS, HEREBY WAIVING PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER
PROCESS OR PAPERS ISSUED THEREIN AND AGREEING THAT SERVICE OF SUCH SUMMONS AND
COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO THE GUARANTOR AT THE ADDRESS OF THE GUARANTOR SET FORTH HEREIN. THE
NONEXCLUSIVE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO
PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF
ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
Section 5. Right of Setoff. Upon the occurrence and during the
continuation of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender to or for the credit or the account of the Guarantor against any and all
of the Guaranteed Obligations now or hereafter existing, whether or not demand
shall have been made under this Guaranty and although such Guaranteed
Obligations may be contingent and unmatured. Each Lender agrees promptly to
notify the Guarantor after any such setoff and application made by such Lender,
provided that the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under this Section are in
addition to any other rights and remedies (including, without limitation, other
rights of setoff) which such Lender may have.
Section 6. Titles and Captions. Titles and captions of
Sections and subsections in this Guaranty are for convenience only, and neither
limit nor amplify the provisions of this Guaranty.
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22
Section 7. Severability of Provisions. Any provision of this
Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 8. Governing Law. This Guaranty shall be construed in
accordance with and governed by the law of the State of New York, without regard
to principles of conflicts of laws.
Section 9. Counterparts. This Guaranty may be executed in any
number of counterparts, each of which shall be deemed to be an original and
shall be binding upon all parties, their successors and assigns.
Section 10. Miscellaneous. This Guaranty and the other
agreements contemplated by this Guaranty supersede all prior negotiations,
agreements and understandings, and constitute the entire agreement between the
parties with respect to the subject matter thereof. All the provisions of this
Guaranty shall be binding upon the Guarantor and its successors and assigns, and
each Lender may assign or transfer any of its rights under this Guaranty in
connection with the transfer of its interests under the Loan Agreement in
accordance with the terms thereof. Any term, covenant, agreement or condition of
this Guaranty may be amended or waived, and any departure therefrom may be
consented to, if, but only if, such amendment, waiver or consent is in writing
and is signed by the Agent and the Required Lenders and, in the case of any
amendment, also by the Guarantor. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
instance and for the specific purpose for which given and no waiver of any
condition, or of the breach of any term, provision, warranty, representation,
agreement or covenant contained in this Guaranty, whether by conduct or
otherwise, in any one or more instances shall be deemed or construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of the breach of any other term, provision, warranty,
representation, agreement or covenant contained in this Guaranty. The failure of
the Agent or any Lender at any time or times to require performance of any
provisions of this Guaranty shall in no manner affect the right to enforce the
same. Whenever the context so requires, the singular number shall include the
plural and the plural shall include the singular, and the gender of any pronoun
shall include the other genders.
Section 11. Notices. All notices and other communications
provided for hereunder shall be in writing and given in accordance with the
provisions of SECTION 15.1 of the Loan Agreement and such provisions are hereby
incorporated herein by this reference as if fully set forth herein. The address
of the Guarantor for such purposes shall be as set forth on the signature page
hereof, or such other address notice of which is given in accordance with the
provisions hereof, and the address of the Lenders shall be as provided from time
to time pursuant to SECTION 15.1 of the Loan Agreement. The Guarantor agrees
that if any notification of intended disposition of Collateral or other security
for the Guaranteed Obligations or of any other act by the Agent or any Lender is
required by law and a specific time period is not stated therein, such
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23
notification given in accordance with the provisions of this SECTION 11, at
least ten (10) days prior to such disposition or act shall be deemed reasonable
and properly given.
Section 12. Limitation on Guaranteed Obligations. The
obligations of the Guarantor hereunder shall be limited to an aggregate amount
that is equal to the largest amount that would not render the obligations of the
Guarantor hereunder subject to avoidance under Section 548 of the United States
Bankruptcy Code (Title 11 of the United States Code) or any comparable provision
of Applicable Law.
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24
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be executed by its duly authorized officer(s) as of the day and year first
written above.
[Corporate Seal] ITCO LOGISTICS CORPORATION
By: /s/ WILLIAM H. GAITHER
Name:________________________
Title:_______________________
Address:
2708 Commerce Road
P.O. Box 641
Wilson, North Carolina 27893
Attest: /s/ J. MICHAEL GAITHER
Name: ____________________
Title:____________________
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GUARANTY
(Subsidiary)
Dated as of May 20, 1998
PHOENIX RACING, INC., a California corporation (the
"Guarantor"), hereby agrees in favor of BANKBOSTON, N.A., a national banking
association, in its capacity as administrative agent for the financial
institutions party from time to time to the Loan Agreement (as defined below),
as follows:
Section 1. Cross References and Definitions.
(a) Reference is made to the Amended and Restated Loan and
Security Agreement, dated on or about the date hereof (the same as it may
hereafter be amended, modified, supplemented or restated from time to time being
referred to as the "Loan Agreement"), by and among The J.H. Heafner Company,
Inc., a California corporation, Oliver & Winston, Inc., a North Carolina
corporation, ITCO Holding Company, Inc., a North Carolina corporation, The Speed
Merchant, Inc., a California corporation (each a "Borrower" and collectively,
the "Borrowers"), the Lenders parties thereto from time to time, the Co-Agents
and the Agent.
(b) For the purposes of this Guaranty:
"Agent" and "Lender" each have the meaning ascribed
to such term in the Loan Agreement and "Lender" also means and includes
each subsequent holder of a Note.
"Obligor" means any obligor, maker, endorser,
acceptor, surety or guarantor (other than the Guarantor), from time to
time, of any Secured Obligation.
(c) Unless otherwise defined in this Guaranty, terms used
herein which are defined in the Loan Agreement shall have the same meaning
herein as therein ascribed to them.
Section 2. Guaranty.
(a) Guaranty. In consideration of the execution and delivery
by the Lenders of the Loan Agreement and as a condition precedent to the making
of loans and other financial accommodations to the Borrowers by the Lenders
thereunder, the Guarantor, as primary obligor and not as surety merely, hereby
guarantees absolutely and unconditionally to the Agent and the Lenders the due
and punctual payment, when and as due (whether upon demand, at maturity, by
reason of acceleration or otherwise), and performance of all Secured
Obligations, whether now existing or hereafter arising (hereinafter referred to
as the "Guaranteed Obligations"), and agrees to pay any and all expenses
(including, but not limited to, reasonable legal fees and disbursements) which
may be incurred by the Agent or any Lender in enforcing their respective rights
under this Guaranty. The liability of the Guarantor under this Guaranty is
primary, unlimited and unconditional, and shall be enforceable before,
concurrently or after any claim or demand is made or suit is filed against any
Borrower or any other Obligor and before,
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concurrently or after any proceeding by the Agent against any Collateral or
other security for the Guaranteed Obligations and shall be effective regardless
of the solvency or insolvency of any Borrower or any other Obligor at any time,
the extension or modification of any of the Guaranteed Obligations by operation
of law or the subsequent reorganization, merger or consolidation of any Borrower
or any change in its composition, nature, ownership, personnel or location, and
this Guaranty shall be a continuing guaranty of any and all notes given in
extension or renewal of the Guaranteed Obligations. The Guarantor acknowledges,
agrees and confirms that this is a guaranty of payment and not of collection
only and that demand for payment may be made hereunder on any number of
occasions in the amount of all or any portion of the Guaranteed Obligations then
due and no single demand shall exhaust the rights of the Agent or the Lenders
hereunder. Further, the Guarantor hereby agrees that all proceeds of Collateral
owned by it shall be applied to the Secured Obligations on a daily basis as and
when received by the Agent as provided in the Loan Agreement as fully as if such
Collateral and proceeds were owned by the Borrowers.
(b) Payment by Guarantor. If the Borrowers shall fail to pay,
when due and payable, any Guaranteed Obligation, the Guarantor will, without
demand or notice, immediately pay the same to the Agent for the account of the
Lenders. If any Guaranteed Obligation would be subject to acceleration, but such
acceleration is enjoined or stayed, the Guarantor will to the extent permitted
by Applicable Law, purchase such Guaranteed Obligation for a price equal to the
outstanding principal amount thereof, plus such accrued interest and other
amounts as would have been payable had such Guaranteed Obligation been paid or
prepaid at the time of such purchase. All payments by the Guarantor under this
Guaranty shall be made without any setoff, counterclaim or deduction whatsoever,
and in the same currency and funds as are required to be paid by the Borrowers.
(c) Waiver. The Guarantor waives without any requirement of
any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, (i) diligence, presentment, demand, protest and
notice of any kind whatsoever, (ii) any requirement that the Agent or any Lender
exhaust any right or take any action against any Obligor or other Person or any
of the Collateral or other security for the Guaranteed Obligations, (iii) the
benefit of all principles or provisions of Applicable Law which are or might be
in conflict with the terms of this Guaranty, (iv) notice of acceptance hereof,
(v) notice of Default or Event of Default, (vi) notice of any and all favorable
and unfavorable information, financial or other, about the Borrowers, any
Obligor or other Person, heretofore, now or hereafter learned or acquired by the
Agent or any Lender, (vii) all other notice to which such Guarantor or Obligor
might otherwise be entitled, (viii) all defenses, set-offs and counterclaims of
any kind whatsoever (but not the right to bring an independent action), (ix)
notice of the existence or creation of any Guaranteed Obligations, (x) notice of
any alteration, amendment, increase, extension or exchange of any of the
Guaranteed Obligations, (xi) notice of any amendments, modifications or
supplements to the Loan Agreement or any Loan Document, (xii) notice of any
release of Collateral or other security for the Guaranteed Obligations or any
compromise or settlement with respect thereto, (xiii) all diligence in
collection or protection of or realization upon the Collateral
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or any of the Guaranteed Obligations, and (xiv) the right to require the Agent
to proceed against any Obligor.
(d) Consents. The Guarantor consents without the requirement
of any notice to or further assent by the Guarantor, to the fullest extent
permitted by Applicable Law, that (i) the time of payment of any Guaranteed
Obligation may be extended, (ii) any provision of the Loan Agreement or any Loan
Document may be amended, waived or modified, (iii) any Obligor may be released
from its obligations or other obligors or Guarantor substituted therefor or
added, (iv) any Collateral or other property now or hereafter securing the
Guaranteed Obligations may be released, exchanged, substituted, compromised or
subordinated in whole or in part or any security may be added, and (v) the Agent
may proceed against the Guarantor or any Obligor without proceeding against any
other Obligor.
(e) Guarantor Bound. The Guarantor will remain bound under
this Guaranty notwithstanding any changes, extensions, exchanges, substitutions,
releases, compromises, subordinations, amendments, waivers or modifications or
any other circumstances, whether or not referred to in CLAUSES (c) OR (d) above,
which might otherwise constitute a legal or equitable discharge of a guaranty.
(f) Absolute Obligation. The obligations of the Guarantor
hereunder are irrespective of and shall not be dependent upon or affected by (i)
the validity, legality or enforceability of the Loan Agreement, the Note(s) or
any Loan Document, (ii) the existence, value or condition of any of the
Collateral or other security for the Guaranteed Obligations, (iii) the validity,
perfection or priority of the Security Interest in any of the Collateral or
other security, (iv) any action or failure to take action by the Agent or any
Lender under, or with respect to, the Loan Agreement, the Note(s), any Loan
Document, any Guaranteed Obligation, any Obligor or any of the Collateral or
other security, (v) any other dealings among the Agent, the Lenders, the
Borrowers or any Obligor, or (vi) any present or future law or order of any
government or agency thereof purporting to reduce, amend or otherwise affect any
obligations of the Borrowers or any Guarantor.
(g) Recovery of Payments. In the event that any or all of the
amounts guaranteed by the Guarantor are or were paid by the Borrowers or any
other Obligor or are or were paid or reduced by application of the proceeds of
any Collateral, and all or any part of such payment is recovered from the Agent
or any Lender under any applicable bankruptcy or insolvency law or otherwise,
the liability of the Guarantor under this Guaranty shall continue and remain in
full force and effect to the extent permitted by Applicable Law.
(h) Waiver of Reimbursement, Subrogation. The Guarantor hereby
waives, to the fullest extent permitted by Applicable Law, any and all rights of
subrogation, indemnification, reimbursement, contribution or similar rights
which the Guarantor may have against the Borrowers or any Obligor or any
Collateral, other security or otherwise until all Secured Obligations have been
paid in full. The provisions of this SUBSECTION (h) shall survive the
termination of this Guaranty.
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(i) Binding Nature of Certain Adjudications. Upon written
notice of the institution by the Agent or any Lender of any action or
proceedings, legal or otherwise, for the adjudication of any controversy with
the Borrowers, the Guarantor will be conclusively bound by the adjudication in
any such action or proceedings and by a judgment, award or decree entered
therein. The Guarantor waives the right to assert in any action or proceeding
brought by the Agent or any Lender, upon the Loan Agreement, the Note(s) or any
Loan Document, any offsets or counterclaims which such Guarantor may have with
respect thereto (other than (subject to SECTION 2(g)) payment of the Secured
Obligations).
(j) Validity and Enforceability of Guaranty. The Guarantor
will take all action required so that the guaranty contained herein will at all
times be a binding obligation of the Guarantor enforceable in accordance with
its terms.
Section 3. Representations and Warranties. The Guarantor
represents and warrants to the Agent and the Lenders as follows:
(a) Organization; Power; Qualification. The Guarantor is a
corporation, duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, has the power and authority to own
its properties and to carry on its business as now being and hereafter proposed
to be conducted and is duly qualified and authorized to do business in each
jurisdiction in which the character of its properties or the nature of its
business requires such qualification or authorization.
(b) Authorization of Guaranty. The Guarantor has the right and
power and has taken all necessary action to authorize it to guarantee the
Guaranteed Obligations hereunder and to execute, deliver and perform this
Guaranty in accordance with its terms. This Guaranty has been duly executed and
delivered by the duly authorized officers of the Guarantor and is a legal, valid
and binding obligation of the Guarantor enforceable in accordance with its
terms.
(c) Compliance of Guaranty With Laws, Etc. The execution,
delivery and performance of this Guaranty in accordance with its terms and the
guaranty of the Guaranteed Obligations hereunder do not and will not, by the
passage of time, the giving of notice or otherwise, (i) require any Government
Approval or violate any Applicable Law relating to the Guarantor, (ii) conflict
with, result in a breach of or constitute a default under (A) the articles of
incorporation or by-laws of the Guarantor, (B) any material provisions of any
indenture, agreement or other instrument to which the Guarantor is a party or by
which it or any of its properties may be bound or (C) any Governmental Approval,
or (iii) result in or require the creation or imposition of any Lien upon or
with respect to any property now owned or hereafter acquired by the Guarantor,
except Liens created pursuant to the Loan Documents.
(d) Financial Interest. The Guarantor is a Wholly Owned
Subsidiary of The J.H. Heafner Company and is engaged in a related and mutually
interdependent business with the Borrowers and will derive indirect financial
and business advantages and benefits from the Loans and other financial
accommodations that the Lenders may make to the Borrowers
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Section 4. Litigation. THE GUARANTOR, THE AGENT AND EACH
LENDER HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVE TRIAL BY JURY IN
ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION
MAY BE COMMENCED BY OR AGAINST THE GUARANTOR ARISING OUT OF THIS GUARANTY OR OUT
OF THE GUARANTOR'S SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT AMONG OR
BETWEEN THE GUARANTOR, ANY LENDER AND THE AGENT, OR BY REASON OF ANY OTHER CAUSE
OR DISPUTE WHATSOEVER BETWEEN THE GUARANTOR AND THE AGENT OR ANY LENDER OF ANY
KIND OR NATURE. THE GUARANTOR, THE AGENT AND EACH LENDER HEREBY AGREE THAT THE
SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE
COURT FROM ANY THEREOF, SHALL HAVE NONEXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE GUARANTOR AND THE AGENT OR SUCH
LENDER, PERTAINING DIRECTLY OR INDIRECTLY TO THIS GUARANTY OR THE LOAN DOCUMENTS
OR TO ANY MATTER ARISING THEREFROM. THE GUARANTOR EXPRESSLY SUBMITS AND CONSENTS
IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH
COURTS, HEREBY WAIVING PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER
PROCESS OR PAPERS ISSUED THEREIN AND AGREEING THAT SERVICE OF SUCH SUMMONS AND
COMPLAINT OR OTHER PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO THE GUARANTOR AT THE ADDRESS OF THE GUARANTOR SET FORTH HEREIN. THE
NONEXCLUSIVE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE DEEMED TO
PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT OBTAINED IN SUCH FORUM OR THE TAKING OF
ANY ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY APPROPRIATE JURISDICTION.
Section 5. Right of Setoff. Upon the occurrence and during the
continuation of any Event of Default, each Lender is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other indebtedness at any time owing by such
Lender to or for the credit or the account of the Guarantor against any and all
of the Guaranteed Obligations now or hereafter existing, whether or not demand
shall have been made under this Guaranty and although such Guaranteed
Obligations may be contingent and unmatured. Each Lender agrees promptly to
notify the Guarantor after any such setoff and application made by such Lender,
provided that the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender under this Section are in
addition to any other rights and remedies (including, without limitation, other
rights of setoff) which such Lender may have.
Section 6. Titles and Captions. Titles and captions of
Sections and subsections in this Guaranty are for convenience only, and neither
limit nor amplify the provisions of this Guaranty.
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Section 7. Severability of Provisions. Any provision of this
Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 8. Governing Law. This Guaranty shall be construed in
accordance with and governed by the law of the State of New York, without regard
to principles of conflicts of laws.
Section 9. Counterparts. This Guaranty may be executed in any
number of counterparts, each of which shall be deemed to be an original and
shall be binding upon all parties, their successors and assigns.
Section 10. Miscellaneous. This Guaranty and the other
agreements contemplated by this Guaranty supersede all prior negotiations,
agreements and understandings, and constitute the entire agreement between the
parties with respect to the subject matter thereof. All the provisions of this
Guaranty shall be binding upon the Guarantor and its successors and assigns, and
each Lender may assign or transfer any of its rights under this Guaranty in
connection with the transfer of its interests under the Loan Agreement in
accordance with the terms thereof. Any term, covenant, agreement or condition of
this Guaranty may be amended or waived, and any departure therefrom may be
consented to, if, but only if, such amendment, waiver or consent is in writing
and is signed by the Agent and the Required Lenders and, in the case of any
amendment, also by the Guarantor. Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
instance and for the specific purpose for which given and no waiver of any
condition, or of the breach of any term, provision, warranty, representation,
agreement or covenant contained in this Guaranty, whether by conduct or
otherwise, in any one or more instances shall be deemed or construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of the breach of any other term, provision, warranty,
representation, agreement or covenant contained in this Guaranty. The failure of
the Agent or any Lender at any time or times to require performance of any
provisions of this Guaranty shall in no manner affect the right to enforce the
same. Whenever the context so requires, the singular number shall include the
plural and the plural shall include the singular, and the gender of any pronoun
shall include the other genders.
Section 11. Notices. All notices and other communications
provided for hereunder shall be in writing and given in accordance with the
provisions of SECTION 15.1 of the Loan Agreement and such provisions are hereby
incorporated herein by this reference as if fully set forth herein. The address
of the Guarantor for such purposes shall be as set forth on the signature page
hereof, or such other address notice of which is given in accordance with the
provisions hereof, and the address of the Lenders shall be as provided from time
to time pursuant to SECTION 15.1 of the Loan Agreement. The Guarantor agrees
that if any notification of intended disposition of Collateral or other security
for the Guaranteed Obligations or of any other act by the Agent or any Lender is
required by law and a specific time period is not stated therein, such
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notification given in accordance with the provisions of this SECTION 11, at
least ten (10) days prior to such disposition or act shall be deemed reasonable
and properly given.
Section 12. Limitation on Guaranteed Obligations. The
obligations of the Guarantor hereunder shall be limited to an aggregate amount
that is equal to the largest amount that would not render the obligations of the
Guarantor hereunder subject to avoidance under Section 548 of the United States
Bankruptcy Code (Title 11 of the United States Code) or any comparable provision
of Applicable Law.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to
be executed by its duly authorized officer(s) as of the day and year first
written above.
[Corporate Seal] PHOENIX RACING, INC.
By: /s/ WILLIAM H. GAITHER
Name:_________________________
Title:________________________
By: /s/ DONALD C. ROOF
Name: Donald C. Roof
Title: Treasurer
Address:
1140 Campbell Avenue
San Jose, California 95126
Attest: /s/ J. MICHAEL GAITHER
Name: ____________________
Title:____________________
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