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Exhibit 10.9
GUARANTY
THIS GUARANTY (this "Guaranty"), dated as of May 1, 1994, is from ANALOG
DEVICES, INC., a Massachusetts corporation (the "Guarantor"), to and for the
benefit of METROPOLITAN LIFE INSURANCE COMPANY (the "Purchaser"), its successors
and assigns and any and all other Beneficiaries (as such term is defined in
Section 9 hereof).
RECITALS
A. The Purchaser has agreed to purchase $10,500,000.00 in aggregate
original principal amount of the 8.87% Senior Secured Notes due May 1, 2007 (the
"Notes"), of Francis J. Perry, Jr. and William J. Walker, not in their
individual capacities, but solely as trustees of Everett Street Trust, a
Massachusetts nominee trust established under Declaration of Trust, dated May 9,
1980 (the "Debtor"), to be issued pursuant to the terms of a Note Purchase
Agreement (the "Note Agreement"), dated May 18, 1994, between the Debtor and the
Purchaser.
B. The Guarantor is the lessee (in its capacity as such, the Guarantor is
hereinafter sometimes referred to as the "Lessee") under an Amended and Restated
Lease Agreement, dated as of May 1, 1992 (as the same may be further amended or
supplemented from time to time, the "Lease"), each with the Debtor, as lessor.
The Debtor will use the proceeds from the sale of the Notes to refinance certain
indebtedness with respect to and to make certain improvements to the Premises
(as defined in the Lease) for the benefit of the Lessee.
C. It is a condition to the purchase by the Purchaser of the Notes under
the Note Agreement that the Guarantor execute and deliver this Guaranty.
NOW, THEREFORE, the Guarantor hereby agrees as follows:
1. GUARANTY OF PAYMENT AND PERFORMANCE OF OBLIGATIONS.
(a) The Guarantor unconditionally guarantees to each of the
Beneficiaries the full and punctual payment of the Obligations (as defined in
subsection (b) below). This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment by the Debtor of each of
the Obligations, and not of collectibility only, and is in no way conditioned
upon any requirement that any Beneficiary first attempts to collect payment from
the Debtor or any other guarantor or surety or resorts to any security or other
means of obtaining payment of all or any of the Obligations or upon any other
contingency. Upon any Event of Default (as defined in the Mortgage) by the
Debtor in the full and punctual payment of any of the Obligations, the
liabilities and obligations of the Guarantor hereunder shall, at the option of
any Beneficiary, become forthwith due and payable without demand or notice of
any nature, all such demands and notices being expressly waived by the
Guarantor.
(b) As used herein, the term "Obligations" means all indebtedness,
obligations and liabilities of any kind of the Debtor to any or all of the
Beneficiaries or otherwise arising under or in connection with the Notes, the
Note Agreement or any other Obligation Agreement (as defined
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below), howsoever incurred, arising or evidenced, whether now or hereafter
existing, due or to become due or of payment, and including without limitation
the Debtor's obligation to pay (i) all principal of, interest on and premium, if
any, including any Make-Whole Payments (as defined in the Mortgage), with
respect to the Notes when and as the same shall become due and payable (whether
at maturity or by declaration or otherwise) and (ii) all costs and expenses
(including court costs, reasonable attorneys' fees and other legal expenses)
incurred by any Beneficiary in exercising and enforcing any of its rights,
powers and remedies under the Notes, the Note Agreement or any other Obligation
Agreement, including without limitation its rights and remedies following an
Event of Default (as defined in the Mortgage) by Debtor. The term "Obligation
Agreement" means the Notes, the Note Agreement, the Mortgage (as defined in the
Note Agreement), the Lease Assignment (as defined in the Note Agreement) and any
other agreement, document or instrument referred to in any thereof.
2. GUARANTY CONTINUING AND LIABILITY UNLIMITED.
(a) This is a continuing guaranty and shall be binding upon the
Guarantor regardless of (a) how long before or after the date hereof any part of
the Obligations was or is incurred by the Debtor and (b) the amount of the
Obligations at any time outstanding (whether more or less than the original
principal amount of the Notes). This Guaranty may be enforced by any or all of
the Beneficiaries from time to time and as often as occasion for such
enforcement may arise.
(b) If after receipt of any payment of, or the proceeds of any
collateral for, all or any part of the Obligations, the Beneficiaries are
compelled to surrender or voluntarily surrender such payment or proceeds to any
person because such payment or application of proceeds is or may be avoided,
invalidated, recaptured, or set aside as a preference, fraudulent conveyance,
impermissible setoff or for any other reason, whether or not such surrender is
the result of (i) any judgment, decree or order of any court or administrative
body having jurisdiction over the Beneficiaries, or (ii) any settlement or
compromise by the Beneficiaries of any claim as to any of the foregoing with any
person (including the Debtor), then the Obligations or part thereof affected
shall be reinstated and continue and this Guaranty shall be reinstated and
continue, in full force as to such Obligations or part thereof as if such
payment or proceeds had not been received, notwithstanding any previous
cancellation of any instrument evidencing any such Obligation or any previous
instrument delivered to evidence the satisfaction thereof. The provisions of
this Section 2(b) shall survive the termination of this Guaranty and any
satisfaction and discharge of the Debtor by virtue of any payment, court order
or any federal or state law.
3. UNCONDITIONAL NATURE OF GUARANTOR'S OBLIGATIONS AND LIABILITIES.
The obligations and liabilities of the Guarantor hereunder shall be
absolute and unconditional, shall not be subject to any counterclaim, set-off,
deduction or defense based upon any claim the Guarantor may have against the
Debtor, any other guarantor, or any other person or entity, and shall remain in
full force and effect until all of the Obligations have been fully satisfied,
without regard to any event, circumstance or condition (whether or not the
Guarantor shall have knowledge or notice thereof) which but for the provisions
of this Section might constitute a legal or equitable defense or discharge of a
guarantor or surety or which might in any way limit recourse against the
Guarantor, including without limitation: (a) any amendment or modification or
supplement to the terms of the Note Agreement, the Lease, the Notes or any other
Obligation Agreement; PROVIDED, HOWEVER that the Guarantor shall not be liable
under this Guaranty for any increase in the Obligations
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which results solely from an amendment, modification or supplement to the Notes
or the Note Agreement to which the Guarantor has not consented; (b) any waiver,
consent or indulgence by any Beneficiary, or any exercise or non-exercise by any
Beneficiary of any right, power or remedy, under or in respect of this Guaranty,
the Note Agreement, the Notes, the Lease or any other Obligation Agreement
(whether or not the Guarantor or the Debtor has or have notice or knowledge of
any such action or inaction); (c) the invalidity or unenforceability, in whole
or in part, of the Note Agreement, the Lease, the Notes or any other Obligation
Agreement, or the termination, cancellation or frustration of any thereof, or
any limitation or cessation of the Debtor's liability under any thereof,
including without limitation any invalidity, unenforceability or impaired
liability resulting from the Debtor's lack of capacity, power and/or authority
to enter into the Note Agreement, the Notes, the Lease or any other Obligation
Agreement and/or to incur any or all of the Obligations, or from the execution
and delivery of any Obligation Agreement by any person acting for the Debtor
without or in excess of authority; (d) any actual, purported or attempted sale,
assignment or other transfer by any or all of the Beneficiaries or by the Debtor
of any Obligation Agreement or of any of its rights, interests or obligations
thereunder; (e) any defect in the Debtor's title to the Premises or any item(s)
of the Mortgaged Property (as defined in the Note Agreement) or in the design,
quality, condition, durability, operation, merchantability or fitness for any
particular use or purpose of any thereof, or the failure of any such item to
meet the requirements or specifications of any law, regulation, judgment,
administrative order or decision or of any agreement between the Debtor and any
other party; (f) any actual, purported or attempted sale, assignment, leasing,
transfer, encumbrance, redelivery or other temporary or permanent disposition of
the Premises or any item(s) of the Mortgaged Property, or any damage to or
destruction, seizure, condemnation, theft, repossession or any other partial or
total loss or loss of use of any thereof; (g) the Debtor's failure to obtain,
protect, preserve or enforce any rights in the Premises or any item(s) of the
Mortgaged Property against any party, or the invalidity or unenforceability of
any such rights; (h) the taking or holding by any or all of the Beneficiaries of
a security interest, lien or other encumbrance in or on any other property as
security for any or all of the Obligations or any exchange, release,
non-perfection, loss or alteration of, or any other dealing with, any such
security; (i) the addition of any party as a guarantor or surety of all or any
part of the Obligations or any limitation of the liability of any additional
guarantor or surety of all or any part of the Obligations under any other
agreement; (j) any merger or consolidation of the Debtor into or with any other
entity, or any sale, lease, transfer or other disposition of any or all of
Debtor's assets or any sale, transfer or other disposition of any or all of the
beneficial interests in the Debtor to any other person or entity; and (k) any
change in the financial condition of the Debtor or the Debtor's entry into an
assignment for the benefit of creditors, an arrangement or any other agreement
or procedure for the restructuring of its liabilities, or the Debtor's
insolvency, bankruptcy, reorganization, dissolution, liquidation or any similar
action by or occurrence with respect to the Debtor.
4. GUARANTOR'S WAIVER.
The Guarantor unconditionally waives, to the fullest extent permitted by
law: (a) notice of any of the matters referred to in Section 3 hereof; (b) any
right to the enforcement, assertion or exercise by any or all of the
Beneficiaries of any of its or their respective rights, powers or remedies
under, against or with respect to (i) the Note Agreement, the Lease, the Notes
or any other Obligation Agreement, (ii) any other guarantor or surety, or (iii)
any security for all or any part of the Obligations, including, without
limitation, the Mortgaged Property; (c) any requirement of diligence and any
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defense based on a claim of laches; (d) all defenses which may now or hereafter
exist by virtue of any statute of limitations, or of any stay, valuation,
exemption, moratorium or similar law; (e) any requirement that the Guarantor be
joined as a party in any action or proceeding against the Debtor to enforce any
of the provisions of the Note Agreement, the Lease, the Notes or any other
Obligation Agreement; (f) any requirement that any Beneficiary mitigate or
attempt to mitigate damages resulting from a default by the Guarantor hereunder
or from a default by the Debtor under the Lease or any of the Obligation
Agreements; (g) acceptance of this Guaranty by any Beneficiary; and (h) all
presentments, protests, notices of dishonor, demands for performance and any and
all other demands upon and notices to the Debtor, and any and all other
formalities of any kind, the omission of or delay in performance of which might
but for the provisions of this Section constitute legal or equitable grounds for
relieving or discharging the Guarantor in whole or in part from its irrevocable,
absolute and continuing obligations hereunder, it being the intention of the
Guarantor that its obligations hereunder shall not be discharged except by
payment and performance and then only to the extent thereof; PROVIDED, HOWEVER,
that the Beneficiaries agree that if, at any time, such Beneficiaries have the
right to assert an identical claim against the Guarantor both under this
Guaranty and under the Put Agreement (as defined in the Note Agreement), then,
so long as the Put Agreement is in full force and effect and the Guarantor is
not in default in any of its obligations thereunder, the Beneficiaries shall
first assert such claim against the Guarantor under the Put Agreement; PROVIDED
FURTHER, HOWEVER, that the Beneficiaries may immediately assert such claim under
this Guaranty without the necessity of asserting such claim under the Put
Agreement if the Guarantor at any time fails to make payment of all or any
portion of such claim as and when due under the Put Agreement or otherwise is in
default of its obligations thereunder.
5. REPRESENTATIONS AND WARRANTIES.
The Guarantor represents and warrants that:
(a) ORGANIZATION AND POWER. The Guarantor (i) is a corporation duly
organized and validly existing under the laws of the Commonwealth of
Massachusetts; and (ii) has all requisite corporate power and authority and all
necessary licenses and permits under the laws of the Commonwealth of
Massachusetts to enter into this Guaranty, the Lease, Put Agreement and Lease
Assignment (herein, collectively, the "Guarantor Documents"), to perform and
observe the terms and conditions of such instruments and to own its properties
and conduct its business as currently conducted. The Guarantor is qualified to
do business as a foreign corporation in all jurisdictions where its ownership of
property or the nature of its business requires such qualification. Each of the
Guarantor's Subsidiaries (i) is a corporation duly organized and validly
existing under the laws of such Subsidiary's state of incorporation, (ii) has
all requisite corporate power and authority to own its properties and conduct
its business as currently conducted and (iii) is qualified to do business as a
foreign corporation in all jurisdictions where its ownership of property or the
nature of its business requires such qualification. The Guarantor Documents have
been duly authorized, executed and delivered by the Guarantor and constitute the
legal, valid and binding obligations of the Guarantor enforceable against the
Guarantor in accordance with their respective terms, except that certain rights
and remedies as set forth in such Guarantor Documents may be limited by
bankruptcy, reorganization and other laws of general application relating to or
affecting the enforcement of creditors' or lessors' rights.
(b) LITIGATION; TAXES. There are no actions, suits or proceedings pending
or, to its knowledge, threatened against or affecting the Guarantor at
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law or in equity before any court or administrative officer or agency an adverse
determination in which could, individually or in the aggregate, have a material
adverse effect on the business, property, assets or financial condition of the
Guarantor. The Guarantor is not in default (i) in the payment of any taxes
levied or assessed against it or its assets or (ii) under or in violation of any
statute, rule, order, decree, writ, injunction or regulation of any governmental
body (including any court).
(c) COMPLIANCE WITH OTHER INSTRUMENTS. The Guarantor is not a party to any
contract or agreement or subject to any restriction or to any order, rule,
regulation, writ, injunction or decree of any court or governmental authority or
to any statute which materially and adversely affects its business, property,
assets or financial condition. Neither the execution, delivery or performance by
the Guarantor of this Guaranty or the other Guarantor Documents nor its
compliance herewith or therewith (A) conflicts or will conflict with or results
or will result in a breach of or constitutes or will constitute a default under
(i) any law in effect as of the date of delivery of this Guaranty, (ii) the
articles of incorporation or by-laws of the Guarantor, (iii) any agreement or
instrument to which the Guarantor is a party or by which it is bound, or (iv)
any order, writ, injunction or decree of any court or other governmental
authority, or (B) results or will result in the creation or imposition of any
lien, charge or encumbrance upon the Guarantor's property pursuant to such
agreement or instrument.
(d) GOVERNMENTAL AUTHORIZATION; CONSENTS. No authorization, consent or
approval of or filing with any governmental authority is required for the
execution, delivery and performance of this Guaranty or any other Guarantor
Document. If, on the Closing Date (as defined in the Note Agreement), any such
authorization, consent, approval or filing shall be required, the same shall
have been obtained or made on or prior to the Closing Date and true and complete
copies of each thereof shall have been provided to the Purchaser. The execution,
delivery and performance by the Guarantor of this Guaranty or any other
Guarantor Document do not require any stockholder approval or the consent or
approval of any of the Guarantor's creditors (except as have already been
obtained in writing).
(e) EVENT OF DEFAULT. No event has occurred and is continuing with respect
to the Guarantor which would constitute a Default or an Event of Default.
(f) OBLIGATIONS TO OTHERS. The Guarantor has no unsatisfied obligations in
excess of $25,000 in the aggregate to any Person arising out of or incurred in
connection with the acquisition, construction, leasing or remodeling by the
Guarantor of its interests in the Premises.
(g) MARGIN STOCK. The Guarantor does not own or have any present intention
of acquiring any "margin stock" as defined in Regulation G (12 C.F.R., Chapter
II, Part 207) of the Board of Governors of the Federal Reserve System. None of
the proceeds of the Notes will be used, directly or indirectly, for the purpose,
whether immediate, incidental or ultimate, of purchasing or carrying any such
margin stock or for the purpose of maintaining, reducing or retiring any
indebtedness which was originally incurred to purchase or carry any such stock
that is currently a margin stock or for any other purpose which might constitute
this transaction a "purpose credit" within the meaning of said Regulation G.
Neither the Guarantor nor any agent acting on its behalf has taken or will take
any action which might cause the transactions contemplated herein to violate
such Regulation G, Regulation T (12 C.F.R., Chapter II, Part 220) or Regulation
X (12 C.F.R., Chapter II, Part 224) or any other regulation of the
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Board of Governors of the Federal Reserve System or to violate the Securities
Exchange Act of 1934, in each case as now in effect or as the same may hereafter
be in effect.
(h) ERISA. The Guarantor is in compliance in all material respects with all
material applicable provisions of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), and the regulations and published interpretations
thereunder. No "reportable event", as such term is defined in Section 4043 of
ERISA, has occurred with respect to any employee pension benefit plan (as
defined in ERISA), and the Guarantor has not incurred, nor does it reasonably
expect to incur, any liability to the Pension Benefit Guaranty Corporation under
Section 4062 of ERISA or to any multiemployer plan (as defined in ERISA) under
Section 4201 of ERISA. The Guarantor has not incurred any accumulated funding
deficiency within the meaning of Section 302 of ERISA nor is it subject to any
lien arising under Section 307 of ERISA or Section 401(a)(29) or 412(n) of the
Internal Revenue Code of 1986, as amended.
(i) SOLVENCY. The Guarantor's assets are not less than its liabilities,
both determined in accordance with generally accepted accounting principles, and
the Guarantor is solvent. The transactions contemplated by this Guaranty and the
other Guarantor Documents are being consummated by the Guarantor in furtherance
of the Guarantor's ordinary business purposes and in furtherance of its
corporate purposes within the meaning of M.G.L. c156B, #9, with no contemplation
of insolvency and with no intent to hinder, delay or defraud any of its present
or future creditors. Neither before nor as a result of the transactions
contemplated by this Guaranty will the Guarantor be or be rendered insolvent or
have an unreasonably small capital for the conduct of its business and the
payment of its anticipated obligations. The Guarantor's assets and cash flow
enable it to meet its present obligations in the ordinary course of business as
they become due, and the Guarantor does not believe that it will incur debts
beyond its ability to pay.
(j) TITLE TO THE PREMISES. The Premises are free and clear of any liens or
encumbrances which result from claims against the Guarantor.
(k) FULL DISCLOSURE. Neither (i) the financial statements for the
Guarantor's fiscal years ending in 1993, 1992, 1991, 1990 and 1989 nor (ii) the
Form 10-Q of the Guarantor for the fiscal quarter ended January 31, 1994 nor
(iii) the Form 10-K of the Guarantor for the fiscal year ended October 30, 1993
nor (iv) any Guarantor Document nor (v) any written statement furnished by the
Guarantor to the Purchaser in connection with the offering and sale of the
Notes, contains any untrue statement of a material fact or omits a material fact
necessary to make the statements contained therein not misleading. There is no
fact applicable to the Guarantor which the Guarantor has not disclosed to the
Purchaser in writing which materially affects adversely nor so far as the
Guarantor can now reasonably foresee will materially affect adversely the
properties, business, prospects, profits or condition (financial or otherwise)
of the Guarantor. The Guarantor represents to the Purchaser that all of the
financial statements and reports specified above have been prepared in
accordance with generally accepted accounting principles, consistently applied.
(l) NO MATERIAL ADVERSE CHANGE. There has been no material adverse change
in the business, properties, prospects or condition, financial or otherwise, of
the Guarantor since October 30, 1993.
(m) OFFERING OF THE NOTES. The Guarantor has not, directly or through an
agent, offered the Notes or any part thereof or any similar security for sale
to, solicited offers to buy any thereof from or otherwise approached or
negotiated with anyone other than the Purchaser. Neither the Guarantor nor any
agent on its behalf will sell or offer any part of the Notes or any part
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thereof or any similar security for sale to, solicit any offers to buy any
thereof from or otherwise approach or negotiate in respect thereof with any
other Person or Persons so as thereby to require registration of the Notes under
Section 5 of the Securities Act of 1933, as amended.
6. CERTAIN COVENANTS AND AGREEMENTS.
In addition to its covenants and agreements set forth elsewhere in this
Guaranty, the Guarantor hereby further covenants and agrees, for so long as any
Obligation is outstanding and unpaid, as follows:
(a) PAYMENT OF OBLIGATIONS. The Guarantor will pay and discharge, and
will cause each Subsidiary to pay and discharge, at or before maturity, all
their respective material obligations and liabilities, including, without
limitation, tax liabilities, except where the same may be contested in good
faith by appropriate proceedings, and will maintain and will cause each
Subsidiary to maintain, in accordance with generally accepted accounting
principles, appropriate reserves for the accrual of any of the same.
(b) MAINTENANCE OF PROPERTY; INSURANCE. (i) The Guarantor will keep,
and will cause each Subsidiary to keep, all property useful and necessary in its
business in good working order and condition, ordinary wear and tear and fully
insured casualty excepted.
(ii) The Guarantor will maintain, and will cause each Subsidiary
to maintain, insurance with financially sound and reputable insurance companies
or associations in such amounts and covering such risks as are usually carried
by companies engaged in the same or a similar business and similarly situated,
which insurance may provide for reasonable deductibility from coverage thereof.
(c) CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. The Guarantor
will continue, and will cause each Subsidiary to continue, to engage in business
of the same general type as now conducted by the Guarantor and its Subsidiaries,
and will preserve, renew and keep in full force and effect, and will cause each
Subsidiary to preserve, renew and keep in full force and effect their respective
corporate existence and their respective rights, privileges and franchises
necessary or desirable in the normal conduct of business; PROVIDED that nothing
in this Section 6(c) shall prohibit (i) the merger of a Subsidiary into the
Guarantor or the merger or consolidation of a Subsidiary with or into another
Person if the corporation surviving such consolidation or merger is a Subsidiary
and if, in each case, after giving effect thereto, no Default or Event of
Default shall have occurred and be continuing or (ii) the termination of the
corporate existence of any Subsidiary if the Guarantor in good faith determines
that such termination is in the best interest of the Guarantor and is not
materially disadvantageous to the Beneficiaries.
(d) COMPLIANCE WITH LAWS. The Guarantor will comply, and cause each
Subsidiary to comply, in all material respects with all applicable laws,
ordinances, rules, regulations, and requirements of governmental authorities
except where the necessity of compliance therewith is contested in good faith by
appropriate proceedings.
(e) INSPECTION OF PROPERTY, BOOKS AND RECORDS. The Guarantor will
keep, and will cause each Subsidiary to keep, proper books of record and account
in which full, true and correct entries shall be made of all dealings and
transactions in relation to its business and activities; and will permit, and
will cause each Subsidiary to permit, representatives of any Beneficiary,
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at such Beneficiary's expense, to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, employees and independent public accountants, all at
such reasonable times and as often as may reasonably be desired.
(f) TRANSACTIONS WITH AFFILIATES. Neither the Guarantor nor any
Subsidiary will enter into any transaction, including, without limitation, the
purchase or sale of any property or the rendering of any service, with any
Affiliate except for transactions entered into in the ordinary course of, and
pursuant to the reasonable requirements of, the Guarantor's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Guarantor
or such Subsidiary than would be obtained in a comparable arm's-length
transaction with a person not an Affiliate.
(g) LEVERAGE RATIO. The Guarantor shall maintain at all times a ratio
of Total Liabilities to Consolidated Tangible Net Worth of not greater than 1 to
1.
(h) MINIMUM CONSOLIDATED TANGIBLE NET WORTH. The Guarantor will at no
time permit Consolidated Tangible Net Worth to be less than the sum of (A)
$312,000,000 PLUS (B) 50% of consolidated net income for the period from October
30, 1993, through the end of the Guarantor's then most recent fiscal quarter
(treated for this purpose as a single accounting period); PROVIDED, HOWEVER,
that in the event that the Guarantor incurs a net loss in one of more of its
fiscal quarters ending after October 30, 1993, then the results of such quarter
or quarters shall be excluded in calculating consolidated net income for the
purposes of clause (B) above.
(i) RESTRICTED PAYMENTS. Neither the Guarantor nor any Subsidiary will
declare or make any Restricted Payment if either (A) a Default or Event of
Default exists or (B) after giving effect thereto, the aggregate of all
Restricted Payments declared or made subsequent to October 30, 1993, would
exceed an amount equal to (x) $48,000,000 PLUS (y) 50% of consolidated net
income for the period from October 30, 1993, through the end of the Guarantor's
then most recent fiscal quarter (treated for this purpose as a single accounting
period). Nothing in this subparagraph (i) shall prohibit the payment of any
dividend or distribution within 45 days after declaration thereof, if such
declaration was not prohibited by this subparagraph (i).
(j) INVESTMENTS. The Guarantor will not make, or permit any of its
Subsidiaries to make, any loan or advance to any Person or purchase or otherwise
acquire, or permit any such Subsidiary to purchase or otherwise acquire any
capital stock, assets, obligations or other securities of, make any capital
contribution to, or otherwise invest in, or acquire any interest in, any Person
(all such transactions being herein called "Investments"), except:
(i) Investments in Liquid Assets;
(ii) Investments in the Guarantor or any of its Consolidated
Subsidiaries;
(iii) Investments in accounts, contract rights and general intangibles
(as defined in the Uniform Commercial Code as in effect in the Commonwealth
of Massachusetts from time to time) or notes or other instruments
receivable, arising from the sale, lease or other furnishing of goods or
services by the Guarantor or any Consolidated Subsidiary in the ordinary
course of business;
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(iv) Investments in equity interests (including stocks and convertible
debt securities) of corporations which do not become Consolidated
Subsidiaries made with the proceeds of the issuance of stock by the
Guarantor;
(v) Acquisitions permitted by Section 6(q);
(vi) Investments (including stocks, equity interests and convertible
debt securities) of corporations that do not become Consolidated
Subsidiaries made with the proceeds of the sale or other disposition of any
capitalized investment permitted by clause (iv), providing that the
Guarantor gives the Beneficiaries notice of such Investment under this
clause; and
(vii) additional Investments not exceeding in the aggregate at any one
time outstanding $20,000,000.
(k) NEGATIVE PLEDGE. Neither the Guarantor nor any Subsidiary will
create, assume or suffer to exist any Lien on any asset now owned or hereafter
acquired by it, except:
(i) Liens securing Indebtedness specified on Exhibit A hereto;
(ii) Liens for taxes or assessments or other government charges or
levies if not yet due and payable or, if due and payable, they are being
contested in good faith by appropriate proceedings and for which
appropriate reserves are maintained;
(iii) Liens imposed by law, such as mechanic's, materialmen's,
landlord's, warehousemen's and carrier's Liens, and other similar Liens,
securing obligations incurred in the ordinary course of business which are
not past due for more than 30 days, or which are being contested in good
faith by appropriate proceedings and for which appropriate reserves have
been established;
(iv) Liens under workmen's compensation, unemployment insurance,
social security or similar legislation;
(v) Liens, deposits or pledges to secure the performance of bids,
tenders, contracts (other than contracts for the payments of money), leases
(as may be permitted under this Guaranty), public or statutory obligations,
surety, stay, appeal, indemnity, performance or other similar bonds, or
other similar obligations arising in the ordinary course of business;
(vi) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate do not materially interfere with the
occupation, use and enjoyment by the Guarantor or any Subsidiary of the
property or assets encumbered thereby in the normal course of business or
materially impair the value of the property subject thereto;
(vii) Liens securing obligations of a Subsidiary to the Guarantor or
to another Subsidiary;
(viii) Judgment and other similar Liens arising in connection with
court proceedings; PROVIDED that the execution or other enforcement of such
Liens is effectively stayed and the claims secured thereby are being
actively contested in good faith and by appropriate proceedings;
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(ix) Liens on any assets of any corporation at the time such
corporation becomes a Subsidiary;
(x) Liens on any assets at the time of acquisition of such assets by
the Guarantor or a Subsidiary;
(xi) Liens on any assets of a corporation existing at the time such
corporation is merged into or consolidated with the Guarantor or a
Subsidiary or at the time of a purchase, lease or other acquisition of the
assets of a corporation or firm as an entirety or substantially as an
entirety by the Guarantor or a Subsidiary;
(xii) Liens granted in connection with the Guarantor's or any
Subsidiary's refinancing of Indebtedness secured by a Lien on any of their
respective assets on the date of the closing for the sale of the Notes;
PROVIDED, HOWEVER, that in no event shall the principal amount of
Indebtedness secured by such Lien exceed 100% of the Indebtedness
originally secured by the Lien to be released in connection with such
refinancing; and
(xiii) Liens not otherwise permitted by the foregoing clauses (i) -
(xii) of this Section securing Indebtedness in an aggregate principal
amount and Swap Obligations with an aggregate mark to market value (net of
mark of market thresholds, if any) at any one time outstanding not to
exceed 30% of Consolidated Tangible Net Worth.
(l) CONSOLIDATIONS, MERGERS AND SALES OF ASSETS. (A) The Guarantor
will not merge or consolidate with or sell, assign, lease or otherwise dispose
of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired), to
any Person unless: (i) the corporation which results from such merger, sale or
consolidation or to which such disposition is made is either (A) the Guarantor
or (B) a corporation organized under the laws of the United States or any state
thereof or the District of Columbia; (ii) the surviving corporation (if not the
Guarantor) or the corporation to which such disposition is made expressly
assumes the Guarantor's obligations hereunder and under the Lease, the Lease
Amendment, the Put Agreement and the Lease Assignment pursuant to documentation
satisfactory in form and substance to the Beneficiaries; (iii) no Default or
Event of Default exists or will result from such merger, sale or consolidation;
(iv) no default by the Debtor exists in respect of payment of any amount due
under the Notes, whether in respect of principal, interest or premium, if any;
and (v) such merger, sale or consolidation will not have a material adverse
effect on the financial condition of the Guarantor or such surviving or
transferee corporation, as the case may be.
(B) No Subsidiary shall merge or consolidate with or sell, assign, lease or
otherwise dispose of (whether in one transaction or in a series of transactions)
all or any part of its assets (whether now owned or hereafter acquired) to any
Person or acquire all or substantially all of the assets or the business of any
Person nor shall the Guarantor permit any of its Subsidiaries to do so, except
that: (i) any Subsidiary may merge into or transfer assets to the Guarantor;
(ii) any Subsidiary may merge into or transfer assets to any other Subsidiary;
and (iii) any Subsidiary may consummate an Acquisition as permitted under
Section 6(q).
(m) SALES AND LEASEBACKS. The Guarantor and its Subsidiaries will not sell
or transfer any of their respective assets and become, directly or indirectly,
liable as the lessee under a lease of such assets if, as a result of such a sale
and leaseback transaction, the combined fair market value (as
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11
determined in good faith by the Guarantor) of all assets of the Guarantor and
its Subsidiaries subject to a sale and leaseback transaction entered into from
and after the date of the sale of the Notes to any date of determination would
exceed 30% of Consolidated Tangible Assets.
(n) SUBSIDIARY INDEBTEDNESS. The Guarantor will not permit a Subsidiary to
incur any Indebtedness except:
(i) Indebtedness listed on Exhibit B hereto;
(ii) Indebtedness incurred pursuant to the refinancing of Indebtedness
permitted pursuant to clause (i) above;
(iii) Guaranties of Indebtedness of the Guarantor;
(iv) Indebtedness to any other Subsidiary or to the Guarantor;
and
(v) Indebtedness not permitted by any of the preceding clauses (i) -
(iv); PROVIDED, HOWEVER, that the aggregate amount of Indebtedness
outstanding at any time pursuant to this clause (v) shall not exceed 20% of
Consolidated Tangible Net Worth; and PROVIDED FURTHER that no Indebtedness
incurred as permitted by clause (iv) above may be sold, transferred or
otherwise assigned at any time to any Person that is not a Subsidiary or is
not the Guarantor.
(o) FINANCIAL STATEMENTS. The Guarantor will deliver to each Beneficiary:
(i) Copies of all public financial statements, including any special or
interim statements of the Guarantor, and any information sent to
shareholders; PROVIDED, HOWEVER, that if such statements do not
include the following information required by this clause (o), the
Guarantor will deliver to said Beneficiaries the following:
(A) Within 120 days after the end of each fiscal year of the
Guarantor, a consolidated balance sheet of the Guarantor and its
Consolidated Subsidiaries as at the end of such year and
consolidated statements of income, retained earnings and changes
in financial position of the Guarantor and its Consolidated
Subsidiaries for such year, setting forth in each case, in
comparative form, the corresponding figures for the preceding
fiscal year in reasonable detail and scope, certified by
independent certified public accountants of nationally recognized
standing selected by the Guarantor; and within 60 days after the
end of the first three fiscal quarters of the Guarantor,
consolidated balance sheets of the Guarantor and its Consolidated
Subsidiaries as at the end of such quarter and consolidated
statements of income, retained earnings and changes in financial
position of the Guarantor and its Consolidated Subsidiaries for
such quarter, setting forth in each case, in comparative form,
the corresponding figures for the similar quarter of the
preceding year, in reasonable detail and scope, and certified by
the treasurer or chief financial officer of the Guarantor;
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12
(B) With reasonable promptness such additional
information (including copies of public reports filed by the
Guarantor) regarding the business affairs and financial condition
of the Guarantor as any Beneficiary may reasonably request; and
(C) Upon the occurrence of any Default or Event of Default
hereunder or under and as defined in the Lease, the Guarantor
promptly shall give written notice thereof to each Beneficiary.
All financial statements specified in clause (A) above shall be accompanied
by the certificate of the treasurer or chief financial officer of the Guarantor
stating that (A) no Default or Event of Default hereunder or under and as
defined in the Lease has occurred and is continuing, (B) if any such Default or
Event of Default has occurred, specifying the nature and the period of existence
thereof and what action the Guarantor has taken or is taking with respect
thereto, (C) the Guarantor has fulfilled all its obligations hereunder and under
the Lease and (D) such financial statements present fairly and completely the
financial condition of the Guarantor and its Consolidated Subsidiaries. As soon
as available and in any event within 120 days after the end of each fiscal year
of the Guarantor, the certification of the independent certified public
accountants referred to in clause (A) above shall be accompanied by a letter
from said accountants stating whether as a result of their examination anything
has come to their attention to cause them to believe that a Default or Event of
Default hereunder or under and as defined in the Lease has occurred, and, if so,
specifying the nature and period of existence thereof.
(p) PAYMENT OF CERTAIN EXPENSES. Whether or not the transactions
contemplated by this Guaranty or the Note Agreement shall be consummated, the
Guarantor will:
(i) Pay all reasonable fees and expenses incurred by the Purchaser and
the Debtor in connection with the transactions described in the Note
Agreement and all reasonable fees and expenses incurred by the Purchaser or
any other Beneficiary in connection with any modification, supplement or
amendment of this Guaranty, the Lease, the Put Agreement or any of the
Obligation Agreements or Guarantor Documents or any waiver or consent under
or in respect of this Guaranty, the Notes, the Lease, the Put Agreement or
any of the Obligation Agreements or Guarantor Documents, whether or not
such modification, supplement, amendment, waiver or consent is obtained or
becomes effective, including in each such instance, without limitation,
printing, word processing and reproduction expenses, reasonable legal fees
(including reasonable legal fees and expenses of each Beneficiary's
counsel), fees and expenses of any appraisers and environmental engineers
and consultants and all recording, registration and filing fees, taxes and
expenses. The Guarantor agrees to pay all expenses incurred by any
Beneficiary (including reasonable counsel fees and the fees, expenses and
disbursements of an investment bank or other firm acting as such
Beneficiary's financial advisor) following the occurrence and during the
continuance of any Default or Event of Default or any workout restructuring
or similar negotiations or any bankruptcy proceeding involving the
Guarantor, the Debtor or any holder of a beneficial interest in the Debtor
and to pay all costs of collection and enforcement, including reasonable
attorneys' fees and disbursements, with respect to this Guaranty, the
Notes, the Lease, the Put Agreement or any other Obligation Agreement or
Guarantor Document;
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13
(ii) Pay and save each Beneficiary harmless from and against any and
all liability and loss with respect to or resulting from the nonpayment or
delayed payment of any and all stamp and other similar taxes (other than
transfer taxes), fees and excises, if any, including any interest and
penalties, which may be, or be determined to be, payable in connection with
the transactions contemplated by the Note Agreement and this Guaranty, or
in connection with any modification, supplement or amendment of this
Guaranty, the Notes, the Lease, the Put Agreement or any of the Obligation
Agreements or Guarantor Documents or any waiver or consent under or in
respect of any thereof; and
(iii) Hold each Beneficiary harmless from and against any and all
finders' or brokerage fees and commissions which may be payable in
connection with the transactions contemplated hereby and by the Note
Agreement or in connection with any modification, supplement or amendment
of this Guaranty, the Notes, the Lease, the Put Agreement or any of the
Obligation Agreements or Guarantor Documents or any waiver or consent under
or in respect of any thereof.
Notwithstanding anything to the contrary contained in this Guaranty, the
Guarantor's obligations under this Section 6(p) shall survive payment of the
Obligations.
(q) ACQUISITIONS. The Guarantor shall not, and shall not permit any of its
Subsidiaries to, consummate any Acquisition, or sell, lease, assign or otherwise
dispose of (whether in one transaction or in a series of related transactions)
all or any substantial part of its assets, whether now owned or hereafter
acquired, or be a party to any merger or consolidation, except that:
(i) the Guarantor and its Subsidiaries may sell inventory or used or
surplus equipment in the ordinary course of business; and
(ii) the Guarantor and any of its Subsidiaries may consummate any
Acquisition (including any Acquisition by way of merger); PROVIDED that:
(i) with respect to any such Acquisition, the Guarantor shall provide to
the Beneficiaries twenty (20) days or more prior written notice thereof;
(ii) with respect to all such Acquisitions the aggregate value, on a
current market value basis (determined at the time of each such
Acquisition), of the consideration therefor paid and to be paid by the
Guarantor and Subsidiaries shall not exceed 33 1/3% of Consolidated
Tangible Net Worth as of the end of the immediately preceding fiscal
quarter; (iii) after giving effect to such Acquisition, the Guarantor shall
be in compliance with all of the terms and conditions hereof; (iv) the
Guarantor or such Subsidiary consummating such Acquisition shall not, after
giving effect to such Acquisition, be in violation of Section 6(c); (v) no
such Acquisition shall have a material adverse effect on the financial
condition of the Guarantor and the Subsidiaries taken as a whole; and (vi)
in respect of each such Acquisition, the Guarantor or such Subsidiary shall
be the surviving or continuing entity.
For the purposes of this Guaranty, the following definitions shall apply:
"Acquisition" means any transaction or series of related transactions,
consummated after the date of this Guaranty, by which the Guarantor or any of
its Subsidiaries (i) acquires any going business or all or substantially all of
the assets of any firm, corporation or division thereof, whether through
purchase of assets, merger or otherwise, or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities of a
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14
corporation which have ordinary voting power for the election of directors
(other than securities having such power only by reason of the happening of a
contingency).
"Affiliate" means (i) any Person that directly, or indirectly through one
or more intermediaries, controls the Guarantor (a "Controlling Person") or (ii)
any Person (other than the Guarantor or a Subsidiary of the Guarantor) which is
controlled by or is under common control with a Controlling Person. As used
herein, the term "control" means possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.
"Consolidated Subsidiary" means any Subsidiary whose accounts are or are
required to be consolidated with the accounts of the Guarantor.
"Consolidated Tangible Assets" means the gross book value of all assets of
the Guarantor and its Consolidated Subsidiaries, determined on a consolidated
basis, minus the following items (without duplication of deductions) appearing
on the balance sheet of the Guarantor and its Consolidated Subsidiaries:
(a) reserves for depreciation, depletion and amortization and other
reserves against assets, reserves for investments, receivables and
income taxes and other liability reserves;
(b) all deferred charges (less amortization), unamortized debt discount
and expense and corporate organizational expenses;
(c) the book amount of all assets (including, without limitation,
goodwill, patents, trademarks and copyrights) which would be treated
as intangibles under generally accepted accounting principles;
(d) the amount by which aggregate inventories appearing on the asset side
of such balance sheet exceed the lower of cost or market value (at the
date of such balance sheet) thereof;
(e) any write-up in the book amount of any asset or investment subsequent
to April 30, 1994, resulting from a reevaluation or reappraisal
thereof from the amount entered in accordance with generally accepted
accounting principles by the Guarantor or its Subsidiary on its books
with respect to its acquisition of the asset or investment; and
(f) the book amount of the minority interest in any Subsidiary.
"Consolidated Tangible Net Worth" means the Tangible Net Worth of the
Guarantor and its Consolidated Subsidiaries on a consolidated basis.
"Default" means any condition or event which with the giving of notice or
lapse of time or both would, unless cured or waived, become an Event of Default.
"Environmental Laws" has the meaning specified in Section 7 of this
Guaranty.
"Event of Default" has the meaning specified in Section 8 of this
Guaranty.
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15
"Guaranty" by any Person means any agreement, undertaking or arrangement, by
which such Person assumes, guarantees, endorses or otherwise is or becomes,
directly or contingently responsible or liable (including, but not limited to,
an agreement to purchase any obligation, stock, assets, goods or services or to
supply or advance any funds, assets, goods or services, or an agreement to
maintain or cause such Person to maintain a minimum working capital or net worth
or otherwise to assure the creditors of any Person against loss) for the
obligations of any Person.
"Indebtedness" means, with respect to any Person (without duplication), (a)
indebtedness for borrowed money which, in accordance with generally accepted
accounting principles, would be classified on a balance sheet as liabilities of
such Person, (b) indebtedness for borrowed money secured by any mortgage, pledge
or other Lien on any property of such Person, (c) Guarantees and (d) letters of
credit to support Indebtedness of others.
"Lien" means, with respect to any asset, any lien (statutory or otherwise),
security interest, mortgage, deed of trust, priority, pledge, charge,
conditional sale, title retention agreement, financing lease or other
encumbrance or similar right of others or any agreement to give any of the
foregoing.
"Liquid Assets" means at any time (i) cash; (ii) current accounts with
banks; (iii) bankers' acceptances, certificates of deposit, and time deposits
evidenced by instruments or documents other than certificates of deposit, in
each case only if due within 1 year, not past due, and issued by United States
commercial banks having assets of $500,000,000 or more; (iv) direct debt
obligations of, or obligations guaranteed by, the United States or of agencies
of the United States, due within 1 year and not past due; and (v) direct debt
obligations of any issuer, due within 1 year and not past due, rated A or MIG- 2
or higher by Moody's Investors Services, Inc.
"Person" means an individual, a corporation, a partnership, an association,
a trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.
"Restricted Payment" means any dividend or other distribution on any shares
of the Guarantor's capital stock (except dividends payable solely in shares of
its capital stock).
"Subsidiary" means, as to any Person, any corporation or other entity of
which at least a majority of the securities or other ownership interests having
ordinary voting power for the election of directors or other persons performing
similar functions are at the time owned directly or indirectly by such Person.
"Swap Obligations" means obligations of the Guarantor and its Subsidiaries
in respect of rate swap transactions, basis swaps, forward rate transactions,
commodity swaps, commodity options, interest rate options, foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options or any other similar transactions (including any options with respect to
any such transactions) or combinations of such transactions.
"Tangible Net Worth" means the excess of total assets over total
liabilities, excluding, however, from the determination of total assets (i)
goodwill; (ii) patents, copyrights and trademarks; (iii) trade names; (iv)
licenses; (v) organizational expenses; and (vi) treasury stock.
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16
"Total Liabilities" means at any time all Indebtedness, obligations and
liabilities of the Guarantor and its Consolidated Subsidiaries, on a
consolidated basis, which should be classified as liabilities of such
corporations on a consolidated balance sheet, and in any event shall include
(without duplication):
(1) all Indebtedness, obligations and liabilities guaranteed by any
Guaranty, and all Indebtedness, obligations and liabilities secured by any
mortgage, lien, assignment, pledge, security interest, charge or encumbrance
upon or in property owned by the respective corporation, even though the
respective corporation has not assumed or become liable for the payment of the
same, to the extent that such Indebtedness, obligations and liabilities actually
outstanding exceed $4,000,000;
(2) the aggregate amount of reserves established on the books of the
Guarantor and its Consolidated Subsidiaries in respect of contingent liabilities
and other contingencies, including contingent obligations to make payments under
contracts; and
(3) contingent liabilities in excess of 20% of Consolidated Tangible Net
Worth.
For the purposes of this Section 6, all definitions and calculations made
or to be made in connection therewith shall be governed by generally accepted
accounting principles, consistently applied, as in effect from time to time.
7. ENVIRONMENTAL MATTERS.
(a) REPRESENTATIONS, WARRANTIES AND COVENANTS. The Guarantor represents,
covenants and warrants to the Beneficiaries that:
(i) at all times during the term of the Lease, the Premises and
the Lessee shall comply in all respects with all applicable
Environmental Laws; the Lessee has obtained all permits,
licenses, and any other authorizations to conduct operations
at the Premises that are required under all applicable
Environmental Laws; the Lessee is in compliance with all
terms and conditions of all permits, licenses, and any other
authorizations required under all applicable Environmental
Laws relating to the Premises;
(ii) as of the commencement of the term of the Lease, no notices,
complaints or orders of violation or non-compliance of any
nature whatsoever had been issued to the Lessee or, to the
best of the Lessee's knowledge, to any person regarding the
Premises, and no federal, state or local environmental
investigation or legal action by a private party is pending
or overtly threatened, in each case with regard to the
Premises or any use thereof or any alleged violation of, or
strict liability arising under, Environmental Laws with
regard to the Premises; no liens have been placed upon the
Premises in connection with any actual or alleged liability
under any Environmental Laws;
(iii) the Premises (a) have not been used by the Lessee or by any other
person to generate, manufacture, refine, produce or process any
Hazardous Substance or to store, handle, transfer or transport
any Hazardous Substance other than normal and lawful uses of such
Hazardous Substances, taking
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17
into account the Lessee's use of the Premises, in lawful
quantities and in compliance with Environmental Laws, and (b)
will not be used by the Lessee or any other Person at any time
during the term of the Lease to generate, manufacture, refine,
produce or process any Hazardous Substance or to store, handle,
transfer or transport any Hazardous Substance, other than normal
and lawful uses of such Hazardous Substances, taking into account
the Lessee's intended use of the Premises, in lawful quantities
and in compliance with Environmental Laws where such uses will
have no material adverse effect upon the Premises;
(iv) no surface impoundments are constructed, operated or
maintained in or on the Premises in violation of applicable
Environmental Laws and no underground storage tanks are
constructed, operated or maintained in or on the Premises;
there is no asbestos nor asbestos-containing material
located in, on, at or under the Premises nor is there any
polychlorinated biphenyl containing equipment, including
transformers located in, on, at or under the Premises; and
(v) the Premises are and at all times during the term of the
Lease will be maintained (a) free of Hazardous Substances to
which Persons working on or visiting the Premises could be
exposed, the removal or remediation of which is required or
the maintenance of which is prohibited or penalized by any
applicable legal requirements of any local, state or federal
agency, authority or governmental unit having jurisdiction
or which would have a material adverse effect upon the
Premises and (b) free of asbestos and asbestos-containing
material and free of polychlorinated biphenyl containing
equipment, including transformers.
(b) COMPLIANCE WITH ENVIRONMENTAL LAWS. The Guarantor and the Lessee shall
(i) fully comply with all Environmental Laws relating to the Premises, (ii)
prohibit the use of the Premises for the generation, manufacture, refinement,
production or processing of any Hazardous Substances or for the storage,
handling, transfer or transportation of any Hazardous Substances (other than
normal and lawful uses of such products in lawful quantities in compliance with
Environmental Laws where such uses will have no material adverse effect upon the
Premises), (iii) refrain from installing or permitting the installation on the
Premises of any underground storage tanks or asbestos-containing materials or,
except in accordance with applicable Environmental Laws, surface impoundments
and (iv) cause any alterations of, or construction on, the Premises to be done
in accordance with applicable Environmental Laws, and in connection with any
such alterations or construction, remove and dispose of, in compliance with
applicable Environmental Laws, any Hazardous Substances present upon the
Premises not in compliance with Environmental Laws.
(c) NOTICES. Promptly upon obtaining knowledge thereof, the Guarantor shall
give to the Beneficiaries notice of the occurrence of any of the following
events: (i) the failure of the Premises or the Lessee or the Guarantor to comply
with any Environmental Law in any manner whatsoever; (ii) the issuance to the
Lessee of any notice, complaint or order of violation or non-compliance of any
nature whatsoever with regard to the Premises or the use thereof with respect to
Environmental Laws; or (iii) any notice of a pending or threatened investigation
to determine whether the Lessee's operations on the Premises are in violation of
any Environmental Law.
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If any Beneficiary at any time receives notice that an adverse change in
the environmental condition of the Premises has occurred or that an adverse
environmental condition with respect to the Premises has been discovered, such
Beneficiary may give notice thereof to the Guarantor, and if the Guarantor has
not (i) diligently commenced to cure such condition, to the extent necessary to
meet legal requirements or comply fully with applicable Environmental Laws or to
prevent a material diminution in the fair market value of the Premises, within
30 days after receipt of such notice (or such shorter period as may be required
by law or in the event of an emergency) and (ii) thereafter diligently
prosecuted to completion such cure, then the Beneficiaries may cause to be
performed an environmental audit or risk assessment of the Premises and the then
uses thereof, and may take such actions as they may deem necessary to cure such
condition. Such environmental audit or assessment shall be performed by an
environmental consultant satisfactory to the Beneficiaries and shall include a
review of the uses of the Premises and compliance of the same with all
Environmental Laws. All costs and expenses incurred by the Beneficiaries in
connection with such environmental audit or assessment and any remediation
required shall be paid by the Guarantor upon demand.
(d) INDEMNIFICATION. The Guarantor agrees to indemnify, defend and hold
harmless each Beneficiary (herein, the "Indemnified Parties") from and against
any and all losses, liabilities, damages, judgments, penalties, claims, charges,
costs and expenses (including, without limitation, fees and disbursements of
counsel and consultants for such Indemnified Party), which may be suffered or
incurred by, or asserted against such Indemnified Party to the extent directly
or indirectly arising out of, or related to, the Premises, or any Indemnified
Party's interest therein pursuant to the Mortgage or the Lease Assignment, or
the enforcement or exercise of any right or remedy of such Indemnified Party
thereunder, or the presence, use, storage, transportation, disposal, release,
threatened release, discharge, emission or generation of any Hazardous
Substances at the Premises, or the violation by the Lessee or the Guarantor of
any Environmental Law or the breach by the Guarantor of any representation or
covenant contained in this Section 7.
The warranties and obligations of the Guarantor and the rights and remedies
of each Indemnified Party under this Section 7 are in addition to and not in
limitation of any other warranties, obligations, rights and remedies provided in
the Lease or otherwise at law or in equity.
In the event of the termination of the Lease as therein provided or the
Lessee's abandonment of the Premises, the obligations and liabilities of the
Guarantor with respect to each Indemnified Party, actual or contingent, under
this Section 7 shall survive such termination or abandonment.
For the purposes of this Section 7, the following definitions shall apply:
"Environmental Laws" means and includes but shall not be limited to the
Resource Conservation and Recovery Act (42 U.S.C. #6901 ET SEQ.) ("RCRA"), as
amended by the Hazardous and Solid Waste Amendments of 1984, the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. #9601 et
seq.) ("CERCLA"), as amended by the Superfund Amendments and Reauthorization
Act of 1986 (Pub. Law 99-499, 100 Stat. 1613) ("SARA"), the Hazardous
Materials Transportation Act (49 U.S.C. #1801 ET SEQ.) ("HMTA"), the Toxic
Substances Control Act (15 U.S.C. #2601 ET SEQ.), Clean Air Act (42 U.S.C.
#9402 ET SEQ.), the Clean Water Act (33 U.S.C. #1251 ET SEQ.), the Federal
Insecticide, Fungicide and Rodenticide Act (7 U.S.C. #136 ET SEQ.), the
Occupational Safety and Health Act (29 U.S.C. #651 ET SEQ.) ("OSHA") and all
applicable federal, state and local environmental laws, including obligations
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under the common law, ordinances, rules, regulations, private agreements (such
as covenants, conditions and restrictions) and publications, as any of the
foregoing may have been or may be from time to time amended, supplemented or
supplanted, and any other federal, state or local laws, including obligations
under the common law, ordinances, rules, regulations, private agreements (such
as covenants, conditions and restrictions) and publications, now or hereafter
existing relating to regulation or control of Hazardous Substances or
environmental health and safety.
"Hazardous Substances" means (i) those substances included within the
definitions of or identified as "hazardous substances", "hazardous materials",
or "toxic substances" in or pursuant to, without limitation, CERCLA, SARA, RCRA,
OSHA and HMTA and in the regulations promulgated pursuant to said laws, all as
amended; (ii) those substances listed in the United States Department of
Transportation Table (40 CFR 172.101 and amendments thereto) or by the
Environmental Protection Agency (or any successor agency) as hazardous
substances (40 CFR Part 302 and amendments thereto); (iii) any material, waste
or substance which is or contains (A) petroleum, including crude oil or any
fraction thereof, natural gas, or synthetic gas usable for fuel or any mixture
thereof, (B) asbestos, (C) polychlorinated biphenyls, (D) designated as
"hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C.
#1251 ET SEQ., (33 U.S.C. #1321) or listed pursuant to Section 307 of the Clean
Water Act (33 U.S.C. #1317); (E) flammable explosives; (F) radioactive
materials; and (iv) such other substances, materials and wastes which are or
become regulated as hazardous, toxic or "special wastes" under applicable local,
state or federal law, or by the United States government, or which are
classified as hazardous, toxic or as "special wastes" under federal, state or
local laws or regulations.
8. EVENTS OF DEFAULT. An "Event of Default" shall exist if any of the
following occurs and is continuing:
(a) if default shall be made in any payment due hereunder by the
Guarantor;
(b) if the Guarantor shall fail to make any payment when due, whether in
respect of principal or interest, on Indebtedness of the Guarantor aggregating
in excess of $5,000,000;
(c) if the Guarantor shall default in the observance or performance of any
other covenant, condition or agreement contained in any instrument(s) evidencing
any Indebtedness of the Guarantor aggregating in excess of $5,000,000, or under
any agreement(s) securing or relating to such Indebtedness, the effect of which
is to cause the holder(s) thereof (or a trustee therefor) to cause such
Indebtedness, or a portion thereof, to become due prior to its stated maturity
or prior to its regularly scheduled date or dates of payment;
(d) if any representation or warranty of the Guarantor set forth in (i) any
certificate delivered in connection with the issuance of the Notes, (ii) the
Lease in its capacity as Lessee, (iii) this Guaranty, (iv) the Put Agreement (as
defined in the Note Agreement), (v) the Lease Assignment (as defined in the Note
Agreement), or (vi) any certificate, notice, demand, or request delivered to any
Beneficiary pursuant to this Guaranty shall be misleading or inaccurate in any
material respect, as of the time when the same shall have been made;
(e) if default shall be made in the due observance or performance of any
covenant, agreement or condition set forth in Section 6 or Section 7 of this
Guaranty, or if any material term of this Guaranty shall cease to be in
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full force or effect or if such material term shall be disavowed by the
Guarantor;
(f) if default shall be made in the due observance or performance of any
other covenant, condition, or agreement of the Guarantor contained herein or in
the Lease in its capacity as Lessee and the Guarantor shall not, within 30 days
after written notice to the Guarantor specifying such default, have commenced
diligently to correct the default or at any time thereafter shall not diligently
pursue such correction to completion;
(g) if a receiver, trustee, or liquidator (or other similar official) of
the Guarantor or of any property of the Guarantor shall be appointed in any
proceeding or by any federal or state officer or agency and shall not be
discharged within 90 days after such appointment or if the Guarantor shall
consent to such appointment or if a custodian for purposes of any federal
bankruptcy statute of substantially all of the Guarantor's property is appointed
or otherwise takes possession thereof or if the Guarantor shall be adjudicated a
bankrupt or be declared insolvent under any federal or state bankruptcy laws, or
if an order for relief shall be entered in any bankruptcy proceeding;
(h) if the Guarantor shall file a petition commencing a voluntary case
under any federal bankruptcy or similar law or in bankruptcy or for
reorganization or for any arrangement pursuant to any state bankruptcy or
similar law or shall make an assignment for the benefit of its creditors or
shall admit in writing its inability, or shall fail, to pay its debts generally
as they become due or shall consent to the appointment of a receiver of any
property of the Guarantor, or if a petition or an answer proposing the
reorganization of the Guarantor pursuant to the Federal Bankruptcy Code or any
similar law, federal or state, shall be filed in, and approved by, any court;
(i) if an involuntary case against the Guarantor, as debtor, is commenced
by a petition for reorganization or liquidation under any federal bankruptcy or
similar law, federal or state, and if such petition shall not be discharged or
denied within 90 days after the date on which such petition was filed; or
(j) if any final judgment or judgments for the payment of money in excess
of $5,000,000 in the aggregate shall be rendered against the Guarantor, and the
Guarantor shall not discharge the same or cause the same to be discharged by the
later of (A) 30 days from the entry thereof and (B) the date payment is required
pursuant to the judgment, if later than 30 days after such date of entry, or
shall not appeal therefrom or from the order, decree or process upon which or
pursuant to which said judgment was granted, based or entered, and secure a stay
of execution pending such appeal.
9. SUCCESSORS AND ASSIGNS.
This Guaranty shall be binding upon the Guarantor and its respective
successors and assigns (including without limitation any and all successors and
transferees which may assume the Guarantor's obligations as provided in Section
6(l) hereof), and shall inure to the benefit of and be enforceable by the
Purchaser, its successors and assigns, and each successive holder of any of the
Notes (herein, collectively, called the "Beneficiaries").
10. SUBORDINATION OF OBLIGATIONS TO GUARANTOR.
Any and all indebtedness and other obligations of the Debtor to the
Guarantor (including without limitation any such obligations resulting from any
rights of subrogation on the part of the Guarantor as a result of any
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payment by the Guarantor hereunder) shall during the term of this Guaranty be
subordinated to the Obligations and to any other indebtedness of the Debtor to
any or all of the Beneficiaries.
11. GOVERNING LAW AND CONSENT TO JURISDICTION.
This Guaranty shall be governed by the laws of the Commonwealth of
Massachusetts. The Guarantor hereby irrevocably and unconditionally submits, for
itself and its property, to the non-exclusive jurisdiction of any New York state
court or federal court of the United States of America sitting in New York, and
any appellate court from any thereof, in any action or proceeding arising out of
or relating to this Guaranty or for recognition and enforcement of any judgment,
and irrevocably and unconditionally consents to all claims in respect of any
such action or proceeding being heard and determined in such New York state
court or, to the extent permitted by law, in such Federal court. A final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any manner
provided by law. Nothing in this Guaranty shall affect any right that any party
may otherwise have to bring any action or proceeding relating to this Guaranty
against the Guarantor or its properties in the courts of any jurisdiction.
The Guarantor hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Guaranty in any New York state or Federal court. The
Guarantor hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
The Guarantor irrevocably consents to service of process in the manner
provided for notices in Section 13. Nothing in this Guaranty will affect the
right of any party to serve process in any other manner permitted by law.
12. SEVERABILITY.
Wherever possible, each provision of this Guaranty shall be construed in
such manner as to be valid and enforceable against the Guarantor under
applicable law, but if any provision hereof shall be deemed invalid or
unenforceable to any extent against the Guarantor in any jurisdiction, such
provision shall be ineffective only to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the remainder
of such provision or any of the other provisions hereof, and any such invalidity
or unenforceability against the Guarantor in one jurisdiction shall not render
such provision ineffective in any other jurisdiction.
13. NOTICES.
All notices, requests, demands and other communications provided for herein
shall be in writing, and shall be sent by (i) reputable overnight delivery
service, and the giving of such communication shall be complete on the
immediately succeeding business day after the same is deposited with such
delivery service or (ii) legible confirmed fax with original to follow the next
day by overnight delivery service as specified in clause (i), and the giving of
such communication shall be complete when such fax is received. Notices shall be
addressed (a) to the Guarantor at One Technology Way, Norwood, Massachusetts
02026-9106, fax number (617) 461-3491, Attention: Chief Financial Officer, (b)
to the Purchaser at its address and fax number set forth in the Note Agreement,
and (c) to any other Beneficiary, at the address and fax number of such
Beneficiary provided by such Beneficiary in writing to
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the Purchaser and the Guarantor or to such other address or fax number as the
Guarantor, the Purchaser or any other Beneficiary shall theretofore have
transmitted to the other parties in writing by any of the means specified in
this Section. Each of the Guarantor, the Purchaser and the Beneficiaries agree
that it will send a courtesy copy of any notice delivered by such party
hereunder to the Debtor at 1416 Providence Highway, Norwood, Massachusetts
02062; PROVIDED, HOWEVER, that the failure to send such a copy to the Debtor
shall not render ineffective any notice otherwise delivered by any such party in
accordance with the terms of this Section 13.
14. HEADINGS; COUNTERPARTS.
Section headings appearing in this Guaranty are for convenience of
reference only and shall not define, limit, amplify or otherwise modify any
provision hereof. This Guaranty may be executed in two or more counterparts,
each of which when executed shall be deemed to be an original but all of which
together shall constitute one and the same agreement.
15. AMENDMENTS.
No provision of this Guaranty may be amended, modified, waived, discharged
or terminated except by a writing signed by each of the Beneficiaries and the
Guarantor expressly referring to the provisions of this Guaranty to which such
writing relates. No course of dealing with respect to any of the rights, powers
and remedies of any or all of the Beneficiaries hereunder, and no delay or
omission on the part of any or all of the Beneficiaries in exercising any such
right, power or remedy, shall operate as a waiver thereof or otherwise be
prejudicial thereto.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
under seal on its behalf by an officer thereunto duly authorized as of the date
first above written.
ANALOG DEVICES, INC.
By: /s/ William A. Martin
--------------------------
Name: William A. Martin
Title: Treasurer
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EXHIBIT A
EXISTING SECURED INDEBTEDNESS
Amounts Outstanding
as of 4/30//94
-------------------
Capital Lease $ 467,000.00
Obligations
25
EXHIBIT B
EXISTING SUBSIDIARY INDEBTEDNESS
Amounts Outstanding
Country Bank Facility as of 4/30/94
- ------- ---- -------- -------------------
France Bank of America Overdraft $ 970,522.00
Belgium Credit Lyonnais Overdraft $2,137,833.00
-------------
$3,108,355.00