EXHIBIT 10.19
LOAN NO. 050-10756-001
GUARANTY
THIS GUARANTY ("Guaranty") is made as of December 20, 2002, by
ADMINISTAFF, INC., a Delaware corporation (hereinafter "Guarantor") in favor of
GENERAL ELECTRIC CAPITAL BUSINESS ASSET FUNDING CORPORATION, a Delaware
corporation (hereinafter "GE CAPITAL").
RECITALS:
A. GE CAPITAL has agreed to lend to ADMINISTAFF SERVICES, LP, a
Delaware limited partnership ("Borrower"), the sum of THIRTY-SIX MILLION AND
NO/100 DOLLARS ($36,000,000.00) (the "Loan") in accordance with the terms and
provisions of a promissory note of even date herewith (the "Note"), to be
secured by a mortgage or deed of trust (the "Deed of Trust") and other security
documents of even date herewith (the Note, the Deed of Trust and all other
documents executed by Borrower in connection with the Loan including, without
limitation, a certain Certificate and Indemnity Agreement Regarding Hazardous
Substances, are collectively called the "Loan Documents").
B. As a condition precedent to making the Loan, GE CAPITAL
requires that Borrower obtain the execution of this Guaranty by Guarantor and GE
CAPITAL will be relying on the terms of this Guaranty in making the Loan.
C. The making of the Loan by GE CAPITAL to Borrower is of value
to Guarantor, is reasonably expected to benefit Guarantor, directly or
indirectly, and is in furtherance of Guarantor's personal and business
interests.
In consideration of GE CAPITAL making the Loan, and as an inducement to
GE CAPITAL to do so, Guarantor hereby agrees, warrants and covenants as follows:
1. Guarantor hereby unconditionally, irrevocably and absolutely
guarantees without demand by GE CAPITAL the full and complete performance of all
of Borrower's obligations under the Loan Documents and the full and prompt
payment when due, whether by acceleration or otherwise, of (a) the entire amount
of principal and accrued interest under the Note, and (b) all other
indebtedness, obligations and liabilities of Borrower under the Loan Documents,
including, without limitation, all costs of collection, reasonable attorneys'
fees, and all court costs, and other advances and extensions thereunder whether
such indebtedness, obligations or liabilities have been incurred prior to the
date of this Guaranty or are incurred from time to time hereafter and all
without set-off, counterclaim, recoupment, or deduction of any amounts owing or
alleged to be owing by GE CAPITAL to Borrower, and (c) the full and complete
performance of all of Borrower's obligations under the Loan Documents. It is
expressly understood that this Guaranty covers, without limitation, (y) any and
all amendments, extensions, modifications, rearrangements and renewals of the
Loan or any of the Loan Documents; and (z) all interest, default interest and
other amounts that would have accrued under the Loan Documents but for the
commencement of a case under the Federal Bankruptcy Code or any other similar
federal or
state law. Without limiting the foregoing, Guarantor specifically guarantees
payment of any judgment entered against Borrower and any damages that may be
awarded in any action brought against Borrower by GE CAPITAL arising out of or
relating to the Loan or any Loan Document. All of the indebtedness, obligations
and liabilities described in this paragraph are referred to herein as the
"Guaranteed Obligations." This Guaranty is a guaranty of payment and not merely
of collection, and Guarantor hereby waive all rights which Guarantor may have,
if any, to require that any action be brought against Borrower (or any other
person or entity) or to require that resort be first made against any security
provided under the Loan Documents prior to demanding and/or enforcing payment or
performance under this Guaranty.
2. This Guaranty shall take effect when received by GE CAPITAL
without the necessity of any acceptance by GE CAPITAL or of any notice to
Guarantor or to Borrower, shall be continuing and irrevocable, and shall remain
in full force and effect until the Guaranteed Obligations are fully and finally
paid. If payment is made by Borrower, whether voluntarily or otherwise, or by
any third party, on the Guaranteed Obligations and thereafter GE CAPITAL is
forced to remit, rescind or restore the amount of that payment under any federal
or state bankruptcy law or law for the relief of debtors, or for any other
reason, (a) the amount of such payment shall be considered to have been unpaid
at all times for the purposes of enforcement of this Guaranty, (b) the
obligations of Borrower guarantied herein shall be automatically reinstated to
the extent of such payment, and (c) Guarantor will, on demand, indemnify GE
CAPITAL for and hold GE CAPITAL harmless from all losses and all reasonable
costs and expenses, including legal fees, incurred by GE CAPITAL in connection
with such remission, rescission or restoration. In the event this Guaranty is
preceded or followed by any other agreement of suretyship or guaranty by
Guarantor or others, all shall be deemed to be cumulative, and the obligations
of Guarantor under this Guaranty shall be in addition to those stated in any
other suretyship or guaranty agreement.
3. The obligations of Guarantor under this Guaranty are separate
and independent of the obligations of Borrower. This Guaranty shall be fully
enforceable against Guarantor notwithstanding any determination that the Loan
Documents, or any part thereof, are not enforceable against Borrower for any
reason. Guarantor expressly agrees that a separate action may be brought against
Guarantor whether or not Borrower is joined in such action.
4. Guarantor represents, warrants, and covenants to GE CAPITAL as
of the date hereof that (a) the financial statements of Guarantor heretofore
delivered to GE CAPITAL fairly present, in all material respects, the financial
condition, results of operations and cash flow of Guarantor as of the respective
dates thereof, and no material adverse change has occurred in the financial
condition of Guarantor since the date of the most recent of such financial
statements (such date being September 30, 2002); (b) Guarantor has derived or
expects to derive financial and other advantages and benefits, directly or
indirectly, from the making of this Guaranty and the Guaranteed Obligations; (c)
no representations or agreements of any kind have been made to Guarantor which
would limit or qualify in any way the terms of this Guaranty; (d) this Guaranty
is executed at Borrower's request and not at the request of GE CAPITAL; (e) GE
CAPITAL has made no representation to Guarantor as to the creditworthiness of
Borrower; (f) Guarantor has established adequate means of obtaining from
Borrower on a continuing-basis information regarding Borrower's financial
condition; (g) Guarantor will keep adequately informed of any facts, events or
circumstances which might in any way affect Guarantor's risks under this
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Guaranty; (h) GE CAPITAL shall have no obligation to disclose to Guarantor any
information or documents (financial or otherwise) heretofore or hereafter
acquired by GE CAPITAL in the course of its relationship with Borrower; and (i)
Guarantor will not, without the prior written consent of GE CAPITAL, either (i)
sell, lease, assign, encumber, hypothecate, transfer, or otherwise dispose of
all or substantially all of Guarantor's assets if any such action might
reasonably be expected to impair the ability of Guarantor to perform its
obligations under this Guaranty, or (ii) take any other action which might
reasonably be expected to impair the ability of Guarantor to perform its
obligations under this Guaranty .
5. Guarantor hereby consents to all terms and conditions of
agreements heretofore or hereafter made between GE CAPITAL and Borrower
(including without limitation the Note and other Loan Documents) and further
agrees that GE CAPITAL may without further consent or disclosure and without
affecting or releasing the obligations of Guarantor hereunder: (a) surrender,
exchange, release, assign, or sell any collateral or waive, release, assign,
sell, or subordinate any security interest, in whole or in part; (b) waive,
delay the exercise of, release, compromise, or grant indulgences in respect of
any rights or remedies of GE CAPITAL against Borrower or any surety or guarantor
(including, without limitation, rights or remedies of GE CAPITAL against
Guarantor under this Guaranty); (c) waive or delay the exercise of any rights or
remedies of GE CAPITAL in respect of any collateral or security, interest now or
hereafter held; (d) renew, extend, waive, extend, accelerate, or modify the
terms of any Guaranteed Obligation or the obligations of any surety or
guarantor, including, without limitation, changes to the rate of interest, or
any instrument or agreement (including, without limitation, the Loan Documents)
evidencing or relating to the same; (e) realize on any security interest,
judicially or non judicially, with or without preservation of a deficiency
judgment; (f) apply payments received from Borrower or any surety or guarantor
(including Guarantor) or from any collateral to any indebtedness, liability, or
obligations of Borrower or such sureties or guarantors whether or not a
Guaranteed Obligation hereunder; or (g) adjust, compromise or receive less than
the amount due upon any collateral or the Guaranteed Obligations, and enter into
any accord and satisfaction or novation agreement with respect to the same as GE
CAPITAL shall deem advisable.
6. Guarantor waives notice of (a) GE CAPITAL's acceptance of this
Guaranty or its intention to act or its actions in reliance on this Guaranty;
(b) the present existence or future incurring of any Guaranteed Obligations or
any terms or amounts thereof or any change therein; (c) any default by Borrower
or any surety or guarantor; (d) the obtaining of any guaranty or surety
agreement (in addition to this Guaranty); (e) the obtaining of any pledge,
assignment or other security for any Guaranteed obligations; (f) the release of
Borrower or any surety or guarantor; (g) the release of any collateral; (h) any
change in Guarantor's business or financial condition; (i) any renewal,
extension or modification of the term of any Guaranteed Obligation or of the
obligations or liabilities of any surety or guarantor or of any instruments or
agreements evidencing the same; (j) any acts or omissions of GE CAPITAL
consented to in Section 5 of this Guaranty; and (k) any other demands or notices
whatsoever with respect to the Guaranteed Obligations or this Guaranty.
Guarantor further waives notice of presentment, demand, protest, notice of
nonpayment, notice of intent to accelerate, and notice of protest in relation to
any instrument or agreement evidencing any Guaranteed Obligation.
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7. To the extent permitted by applicable law, Guarantor expressly
waives any and all rights to defenses arising by reason of (a) any "one-action"
or "anti-deficiency" law or any other law which may prevent GE CAPITAL from
bringing any action, including a claim for deficiency against Guarantor, before
or after GE CAPITAL's commencement or completion of any foreclosure action,
either judicially or by exercise of a power of sale; (b) any election of
remedies by GE CAPITAL which destroys or otherwise adversely affects Guarantor's
subrogation rights or Guarantor's rights to proceed against Borrower for
reimbursement, including without limitation any loss of rights Guarantor may
suffer by reason of any law limiting, qualifying, or discharging the Guaranteed
Obligations; (c) any disability or other defense of Borrower, of any other
guarantor, or of any other person, or by reason of the cessation of Borrower's
liability from any cause whatsoever, other than full and final payment in legal
tender of the Guaranteed Obligations; or (d) any right to claim discharge of the
Guaranteed Obligations on the basis of unjustified impairment of any collateral
for the Guaranteed Obligations. Guarantor further waives (a) to the extent
permitted by law, the defense of any statute of limitations in any action to
enforce this Guaranty and agrees that any part payment by Borrower or other
circumstance which operates to toll any statute of limitations as to Borrower
shall toll the statute of limitations as to Guarantor, (b) any right to cause a
marshalling of Borrower's assets, (c) all exemptions and homestead laws, and (d)
all rights of set-off and counterclaims. Guarantor agrees that GE CAPITAL may
proceed against any collateral securing the Guaranteed Obligations by way of
either judicial or nonjudicial foreclosure. Guarantor understands that a
nonjudicial foreclosure of any deed of trust securing the Guaranteed Obligations
could impair or eliminate any subrogation or reimbursement rights Guarantor may
have against Borrower, nevertheless Guarantor hereby waives and relinquishes any
defense based upon the loss of any such reimbursement or subrogation rights or
any other defense which may otherwise arise therefrom and any defense that may
arise out of election of remedies, discharge or satisfaction of the Guaranteed
Obligations. In the event any such deed of trust is foreclosed, judicially or
non judicially, Guarantor's liability under this Guaranty shall be that portion
of the Guaranteed Obligations representing a deficiency resulting from a
judicial or nonjudicial sale, i.e., the difference between the amount due and
owing on the Guaranteed Obligations on the day of the foreclosure sale
(including without limitation principal, accrued interest, reasonable attorneys'
fees, late payments, if any, and costs of foreclosure) and the amount of the
successful bid at any such judicial or nonjudicial foreclosure sale. Guarantor
hereby waives the right to object to the amount which may be bid by GE CAPITAL
at such foreclosure sale.
8. The obligations, covenants, agreements and duties of Guarantor
under this Guaranty shall not be released or impaired in any manner whatsoever,
without the written consent of GE CAPITAL, on account of any or all of the
following: (a) any act or omission of GE CAPITAL consented to in Section 5 of
this Guaranty; (b) the failure to receive any notice, demand, presentment or
protest waived in Sections 4 and 6 of this Guaranty; (c) the occurrence of any
event as to which Guarantor has provided its waiver under Section 7 of this
Guaranty; (d) any failure by Borrower or any other guarantor or surety to
perform or comply with the Guaranteed Obligations or the terms of any instrument
or agreement relating thereto; (e) any change in the name, purpose, capital
stock or constitution of Borrower or any other guarantor or surety; (f) any
irregularity, defect or unauthorized action by GE CAPITAL, Borrower or any other
guarantor or surety or any of their respective officers, directors or other
agents in executing and delivering any instrument or agreements relating to the
Guaranteed Obligations or in
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carrying out or attempting to carry out the terms of any such agreements; (g)
any receivership, insolvency, bankruptcy, reorganization or similar proceeding
by or against Borrower, GE CAPITAL, Guarantor or any other surety or guarantor;
(h) any setoff, counterclaim, recoupment, deduction, defense or other right
which Guarantor may have against GE CAPITAL, Borrower or any other person for
any reason whatsoever whether related to the Guaranteed Obligations or
otherwise; (i) any assignment, endorsement or transfer, in whole or in part, of
the Guaranteed Obligations, whether made with or without notice to or the
consent of Guarantor; (j) the voluntary or involuntary liquidation, sale or
other disposition of all or substantially all of the assets of Borrower or any
guarantor; (k) the acceptance of additional or substitute property as security
for or any additional guaranty as surety for any Guaranteed Obligation; (1) the
operation of law or any other cause, whether similar or dissimilar to the
foregoing; (m) the failure by GE CAPITAL to file or enforce a claim against the
estate (either in administration, bankruptcy or other proceeding) of Borrower or
any other person or entity (including, without limitation, any guarantor); (n)
if the recovery from Borrower or any other person or entity (including, without
limitation, any other guarantor) becomes barred by any statute of limitations or
is otherwise prevented; (o) any impairment, modification, change, release or
limitation of liability of, or stay of actions of lien enforcement proceedings
against Borrower, Borrower's property, or its estate in bankruptcy resulting
from the operation of any present or future provision of the Federal Bankruptcy
Code or any other similar federal or state statute, or from the decision of any
court; or (p) any neglect, delay, omission, failure or refusal of GE CAPITAL to
take or prosecute any action for the collection of any of the Guaranteed
Obligations or to foreclose or take or prosecute any action in connection with
any lien or right of security (including perfection thereof) existing or to
exist in connection with, or as security for, any of the Guaranteed Obligations,
it being the intention of Guarantor that Guarantor shall remain liable as a
principal on the Guaranteed Obligations notwithstanding any act, omission or
event which might, but for the provisions of this Guaranty, otherwise operate as
a legal or equitable discharge of Guarantor. Guarantor hereby waives all
defenses of a surety to which it may be entitled by statute or otherwise.
9. Guarantor acknowledges that GE CAPITAL may obtain other
guaranties and collateral to secure the repayment of the Guaranteed Obligations.
Guarantor represents and warrants to GE CAPITAL, however, that in making this
Guaranty it is not relying upon GE CAPITAL's obtaining any guaranty agreements
(other than this Guaranty) or any collateral pledged or assigned to secure
repayment of the Guaranteed Obligations. Guarantor specifically acknowledges
that GE CAPITAL's obtaining any such guaranty agreements or collateral is not a
condition to the enforcement of this Guaranty. If GE CAPITAL should
simultaneously or hereafter elect to attempt to take additional guaranty
agreements or collateral to secure repayment of the Guaranteed Obligations, and,
if its efforts to do so should fail in any respect including, without
limitation, a determination that the agreement purporting to provide such
additional guaranty or security interest is invalid or unenforceable for any
reason, this Guaranty shall, nonetheless, remain in full force and effect.
10. Guarantor hereby irrevocably waives all claims it has or may
acquire against Borrower in respect of the Guaranteed Obligations, including
rights of exoneration, reimbursement and subrogation until the Guaranteed
Obligations are paid in full and fully performed. Guarantor has received no
indemnification or other agreement of reimbursement from Borrower in connection
with the execution and delivery of this Guaranty.
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11. This Guaranty shall inure to the benefit of GE CAPITAL and GE
CAPITAL's successors and assigns and shall be binding upon Guarantor and its
legal representatives, administrators, successors and assigns. GE CAPITAL may,
without any notice whatsoever to Guarantor, or to anyone else, sell, assign or
transfer the Note, with or without any security therefor, and in that event each
and every immediate and successive assignee, transferee or holder of all or any
part of the Loan and the Note shall have the right to enforce this Guaranty, by
suit or otherwise, for the benefit of such assignee, transferee or holder as
though such parties were herein by name specifically given those rights, powers
and benefits.
12. Guarantor agrees to pay all costs and expenses which may be
incurred by GE CAPITAL in the enforcement or interpretation of this Guaranty,
including reasonable attorneys' fees (to be determined by the court and not by a
jury), and including all costs and reasonable attorneys' fees incurred in any
bankruptcy or insolvency proceeding or on appeal to one or more appellate
courts.
13. This Guaranty shall be governed by and construed and enforced
under the laws of the State of Texas.
14. No delay on the part of GE CAPITAL in exercising any right,
power or privilege under this Guaranty shall operate as a waiver of any such
right, power or privilege, nor shall any exercise or waiver of any privilege or
right preclude any other or further exercise of such privilege or right or the
exercise of any other right, power or privilege. All of GE CAPITAL's rights and
remedies shall be cumulative. In the event GE CAPITAL, in its sole discretion,
elects to give notice of any action with respect to the sale of collateral, if
any, securing the Guaranteed Obligations or any part thereof, Guarantor agrees
that ten (10) days prior written notice shall be deemed reasonable notice of any
matters contained in such notice.
15. Any indebtedness of Borrower now or hereafter held by
Guarantor is hereby subordinated to the Guaranteed Obligations. If GE CAPITAL so
requests after the occurrence of an Event of Default (as such term is defined in
the Deed of Trust), and unless and until such Event of Default is cured to the
satisfaction of GE CAPITAL, such indebtedness of Borrower to Guarantor shall be
collected, enforced and received by Guarantor in trust for GE CAPITAL, and be
paid over to GE CAPITAL on account of the Guaranteed Obligations, but without
reducing or affecting in any manner the liability of Guarantor under the other
provisions of this Guaranty. Guarantor shall file all claims against Borrower in
any bankruptcy or other proceeding in which the filing of claims is required by
law upon any indebtedness of Borrower to Guarantor and will assign to GE CAPITAL
all rights of Guarantor thereunder. If Guarantor does not file any such claim,
Guarantor hereby appoints and constitutes GE CAPITAL as Guarantor's
attorney-in-fact and hereby authorizes GE CAPITAL to do so in the name of
Guarantor or, in GE CAPITAL's discretion, to assign the claim and to cause the
claim to be filed in the name of GE CAPITAL's nominee. In all such cases,
whether in administration, bankruptcy or otherwise, the person or persons
authorized to pay such claim shall pay to GE CAPITAL the full amount thereof,
and Guarantor hereby assigns to GE CAPITAL, to the full extent necessary for
that purpose, all of Guarantor's rights to any such payments or distributions to
which Guarantor would otherwise be entitled. Nothing in this paragraph shall be
construed to create a duty in GE CAPITAL to take any action whatsoever to
protect any right Guarantor may have as to Borrower.
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16. If any provision of this Guaranty or any portion of any
provision of this Guaranty shall be deemed to be invalid, illegal or
unenforceable, such invalidity, illegality or unenforceability shall not alter
the remaining portion of such provision, or any other provision hereof, as each
provision of this Guaranty shall be deemed severable from all other provisions
of this Guaranty.
17. This Guaranty shall be so construed that, wherever applicable,
the use of the singular number shall include the plural number, the use of the
plural number shall include the singular number, and the use of any gender shall
be applicable to all genders, and shall likewise be so construed as applicable
to and including a corporation, partnership or other entity. Each married
individual who executes this Guaranty intends to bind both his or her separate
estate and the community estate of that married individual and his or her
spouse. If this Guaranty is executed by more than one person or entity, the
obligations of each Guarantor hereunder shall be joint and several and this
Guaranty shall apply to each of the individuals or entities comprising Guarantor
as if each had executed a separate guaranty.
18. All agreements between Guarantor and GE CAPITAL, whether now
existing or hereafter arising and whether written or oral, are hereby limited so
that in no contingency, whether by reason of demand or acceleration of the final
maturity of the Loan or otherwise, shall the interest contracted for, charged,
received, paid or agreed to be paid to GE CAPITAL under or in connection with
the Loan exceed the maximum amount permissible under applicable law. All
interest paid or agreed to be paid to GE CAPITAL shall, to the extent permitted
by applicable law, be amortized, prorated, allocated, and spread throughout the
full period (including any renewal or extension) until payment in full of the
principal balance of the Loan so that the interest hereon for such full period
shall not exceed the maximum amount permissible under applicable law. GE CAPITAL
expressly disavows any intent to contract for, charge or receive interest in an
amount which exceeds the maximum amount permissible under applicable law. This
paragraph shall control all agreements between Guarantor and GE CAPITAL.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the date
written above.
GUARANTOR:
ADMINISTAFF, INC.,
a Delaware corporation
By: /s/ Richard G. Rawson
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Print: Richard G. Rawson
Its: Executive Vice President,
Administration, Chief Financial Officer
& Treasurer
ADDRESS:
19001 Crescent Springs Drive
Kingwood, Texas 77339
Taxpayer ID No.: 76-0479645
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