EXHIBIT (b)(5)
GUARANTY AGREEMENT
(ACQUISITION LOAN)
THIS GUARANTY AGREEMENT, made as of January__, 2003, by SCOTT M.
NISWONGER, whose address is 430 Airport Road, Greeneville, Tennessee 37745
("Niswonger"), and JOHN A. TWEED, whose address is 430 Airport Road,
Greeneville, Tennessee 37745 ("Tweed"), for the benefit of FIRST TENNESSEE BANK
NATIONAL ASSOCIATION, a national banking association with offices in
Greeneville, Tennessee at 2841 E. Andrew Johnson Highway, Greeneville, Tennessee
37745 ("Lender").
W I T N E S S E T H:
WHEREAS, Lender has made available to Landair Acquisition Corporation,
a Tennessee corporation with principal offices in Greeneville, Tennessee (the
"Borrower"), a loan facility in the original principal amount not exceeding
$25,000,000 on the terms and conditions set forth in that certain Loan and
Security Agreement between Lender and Borrower dated as of the date hereof (the
"Acquisition Loan Agreement");
WHEREAS, Niswonger and Tweed (collectively the "Guarantors") are
principal officers and shareholders of the Borrower; and
WHEREAS, the Guarantors have agreed to guarantee the payment and
performance of Borrower's obligations under the Acquisition Loan Agreement, as
provided herein.
NOW, THEREFORE, in consideration of the foregoing and in further
consideration of the anticipated benefits to the Guarantors by virtue of their
relationship to the Borrower, to induce the Lender to make the Loan, the
Guarantors hereby covenant and agree as follows:
1. Guaranteed Obligations. The Guarantors hereby jointly and
severally guarantee to the Lender the full and prompt payment and performance of
the following (hereinafter referred to collectively as "Guaranteed
Obligations"): all of the accrued interest due and payable on the indebtedness
evidenced by a Secured Promissory Note (Acquisition Loan) dated as of the date
hereof in the principal amount of $25,000,000 (the "Note").
2. Term of Guaranty. This Guaranty shall be a continuing,
absolute and unconditional Guaranty and shall remain in full force and effect
until all Guaranteed Obligations are made or performed in full by the Borrower
or the Guarantors, as the case may be, provided that if such Guaranteed
Obligations are made or performed in full by the Borrower, the obligations of
the Guarantors hereunder shall not thereby be discharged unless a period of 91
days beginning with the date of the last such Guaranteed Obligation made or
performed by the Borrower shall elapse during which no petition in bankruptcy
shall be filed by or against the Borrower, and the Guarantors shall not be
entitled to return of this Guaranty until expiration of such 91-day period. If
for any reason any payment (including principal, interest, costs, expenses and
attorney's fees) by, or undertaking of, Borrower to the Lender shall be
determined at any
time to be a voidable preference or otherwise shall be set aside or required to
be returned or repaid, this Guaranty, nevertheless, shall remain in effect and
shall be fully enforceable against the Guarantors for the undertaking or payment
thus set aside, returned or repaid, as well as any obligations hereunder still
outstanding, together with any costs, expenses and attorney's fees incurred by
the Lender in connection with such determination.
3. Guaranty of Payment. This is a guaranty of payment and not of
collection, and the Guarantors expressly waive any right to require that any
action be brought against the Borrower or any other guarantor of any of the
Guaranteed Obligations or to require that resort be had to any security. The
Guarantors further waive any right of the Guarantors to require that an action
be brought against Borrower under the provisions of Title 47, Chapter 12,
Tennessee Code Annotated, as the same may be amended from time to time. If the
Borrower shall fail to make any Guaranteed Obligation when and as the same
becomes due (whether at maturity, by acceleration or call for prepayment or
otherwise), the Guarantors, upon demand, without notice other than such demand
and without the necessity of further action by the Lender, shall promptly and
fully make or perform such Guaranteed Obligation. The Guarantors shall pay all
reasonable costs and expenses, including reasonable counsel fees and expenses,
paid or incurred by the Lender in connection with the enforcement of the
obligations of the Guarantors hereunder. All payments by the Guarantors shall be
made in lawful money of the United States of America and may be applied to the
Guaranteed Obligations as the Lender in its sole discretion deems fit. Each
default in any Guaranteed Obligation shall give rise to a separate cause of
action hereunder, and separate suits may be brought hereunder as each cause of
action arises. The Guarantors bind and obligate themselves for the payment and
performance of the Guaranteed Obligations the same as if the Guaranteed
Obligations had been contracted for by and was due from the Guarantors
personally, hereby agreeing to and binding themselves and their successors and
assigns by all terms and conditions contained in the Acquisition Loan Agreement,
or any other document or other evidence of indebtedness, signed or to be signed
by Borrower, and any other documents executed by the Borrower in connection
therewith or as security therefor, making itself a party thereto, hereby waiving
notice of any such indebtedness and of demand, presentment, protest or notice of
demand or nonpayment and of any act to establish the liability of any party on
any commercial or other paper, indebtedness or obligation covered by this
Guaranty.
4. Obligations Unconditional. The obligations of the Guarantors
hereunder shall not be impaired, modified, released or limited by any occurrence
or condition whatsoever, including without limitation:
(a) any compromise, settlement, release, waiver, renewal, extension,
indulgence, change in or modification of (i) any of the obligations and
liabilities, either original or assumed, of the Borrower contained in
the Acquisition Loan Agreement, the Pledge Agreement, or any Loan
Documents relating thereto (collectively, the "Financing Instruments"),
(ii) the liens and security interests created by the Pledge Security
Agreement, or (iii) any other security for the Borrower's obligations
under the Financing Instruments,
(b) any impairment, modification, release or limitation of (i) the
liability of the Borrower, (ii) the liens and security interests
created by the Pledge Agreement, or (iii) any other security for the
Borrower's obligations under the Financing Instruments, or any remedy
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for the enforcement thereof, resulting from the operation of any
present or future provision of the Federal bankruptcy laws or other
statute or from the decision of any court relating thereto,
(c) the assertion or exercise by the Lender of any rights or remedies
under the Financing Instruments or this Guaranty or any other guaranty
of the Borrower's obligations under the Acquisition Loan Agreement or
any delay in asserting or exercising, or failure to assert or exercise,
any such rights or remedies, and
(d) the assignment or sale or the purported assignment or sale of all
or any part of the interest of the Borrower in the Collateral (as
defined in the Acquisition Loan Agreement). The liability of the
Guarantors hereunder shall not be in any manner affected, diminished or
impaired by any lack of diligence, neglect or omission on the part of
the Lender to make any demand or protest, or give any notice of
dishonor or default, or to realize upon or protect any collateral or
security for the Guaranteed Obligations, or to exercise any lien upon
or right or appropriation or setoff of any monies, accounts, credits or
property of Borrower possessed by the Lender toward the liquidation of
the Guaranteed Obligations or by any application of payments or credits
thereon. Any impairment of collateral is hereby specifically waived.
The Lender shall have the exclusive right to determine how, when and
what application of payments and credits, if any, shall be made on the
Guaranteed Obligations, or any part thereof, and shall be under no
obligation, at any time, to first resort to, make demand on, file a
claim against, or exhaust its remedies against Borrower, or other
persons or corporations, their properties or estates, or to resort to
or exhaust its remedies against any collateral, security, property,
liens or other rights whatsoever.
5. Setoff. As security for the undertakings and obligations of
the Guarantors hereunder, the Guarantors expressly grant and give to the Lender
a right of immediate setoff, without demand or notice, of the balance of every
deposit account, now or at any time hereafter existing, of the Guarantors with
any Lender, and a general lien upon, and security interest in, all money,
negotiable instruments, commercial paper, notes, bonds, stocks, credits and/or
chooses in action, or any interest therein, and any other property, rights and
interests of the Guarantors or any evidence thereof, which has or at any time
shall come into the possession, custody or control of any Lender, and, in the
event of default hereunder, such Lender may sell or cause to be sold at public
or private sale in any manner which may be lawful, all or any of such security,
for cash or credit and upon such terms as such Lender may see fit, and (except
as may be otherwise expressly provided by the Uniform Commercial Code, or other
applicable law) without demand or notice to the Guarantors, and any Lender
(unless prohibited by the Uniform Commercial Code from so doing) or any other
person may purchase such property, rights or interests so sold and thereafter
hold the same free of any claim or right of whatsoever kind, including any right
or equity of redemption, of the Guarantors, such demand, notice, right or equity
of redemption being hereby expressly waived and released.
6. Subordination of Borrower's Indebtedness. The Guarantors
hereby subordinate all indebtedness of the Borrower owing to the Guarantors,
whether now existing or hereinafter arising, to the full and prompt payment of
the Guaranteed Obligations, when and as the same
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shall become due (whether at maturity, by acceleration, or otherwise). So long
as there is no default, or Event of Default, if applicable, under any of the
Loan Documents, or hereunder, the Guarantors may continue to receive and retain
payment on said subordinated indebtedness when and as the same becomes due. Any
amounts received by the Guarantors as a payment on said subordinated
indebtedness subsequent to any such default, or Event of Default, if applicable,
shall be retained and held in trust by such Guarantors for the benefit of the
Lender.
7. Representations of Guarantor. The Guarantors hereby make all
those representations and warranties which are made by the Borrower with respect
to the Guarantors in Article V of the Acquisition Loan Agreement. Furthermore,
the Guarantors represent and warrant that as of the date hereof, there has been
no material adverse change in the most recent financial information given by
Guarantors to the Lender.
8. Information. The Guarantors shall provide to the Lender such
information respecting the business, properties or the condition or operations,
financial or otherwise, of the Guarantors as the Lender may from time to time
reasonably request or which the Borrower may be required to provide with respect
to the Guarantors under the Acquisition Loan Agreement, including but not
limited to unaudited personal financial statements, copies of federal income tax
returns for the prior fiscal year of the Guarantors, and verification of income.
9. Payment on Default. Upon the occurrence of an Event of Default
under the Acquisition Loan Agreement, the Guarantors shall immediately pay to
the Lender, all amounts for which the Borrower is obligated to the Lender under
the Acquisition Loan Agreement and the Lender may take whatever action at law or
in equity may appear necessary or desirable to collect payments then due or
thereafter to become due hereunder or to enforce observance or performance of
any covenant, condition or agreement of the Guarantors under this Guaranty.
10. Additional Indebtedness. The granting of credit from time to
time by the Lender to Borrower, in excess of the amount to which a right of
recovery under this Guaranty is limited and without notice to the Guarantors, is
hereby expressly authorized and shall in no way affect or impair this Guaranty;
and, in the event that the indebtedness of Borrower to the Lender shall so
exceed the amount to which this Guaranty is limited, any payments by Borrower to
the Lender and any collections or recovery by the Lender from any sources other
than this Guaranty may first be applied by the Lender to any portion of the
indebtedness which exceeds the limits of this Guaranty, provided that any
amounts collected by the Lender pursuant to the exercise of any remedies under
the Acquisition Loan Agreement or any documents securing the obligations of
Borrower under the Acquisition Loan Agreement shall be applied in accordance
with the applicable provisions, if any, of such documents.
11. Assignment by the Lender. The Lender may, without any notice
whatsoever to anyone, sell, assign or transfer all or any part of the Guaranteed
Obligations, and in that event each and every immediate and successive assignee,
transferee or holder of all or any part of the Guaranteed Obligations shall have
right to enforce this Guaranty, by suit or otherwise, for the benefit of such
assignee, transferee or holder, as fully as though such assignee, transferee or
holder were herein by name given such rights, powers and benefits; but the
Lender shall have an unimpaired right, prior and superior to that of any said
assignee, transferee or holder, to enforce
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this Guaranty for the benefit of the Lender, as to so much of the Guaranteed
Obligations that it has not sold, assigned or transferred.
12. Actions of the Lender; Waiver of Rights. No act or omission of
any kind, or at any time, on the part of the Lender in respect to any matter
whatsoever shall in any way affect or impair this Guaranty. This Guaranty is in
addition to and not in substitution for or discharge of any other Guaranty held
by the Lender. The Guarantors waive any right of action it might have against
the Lender because of exercise by the Lender in any manner howsoever of any
rights granted to the Lender herein. The Guarantors further hereby expressly
waive any legal requirements incident to the making or incurring of the
Guaranteed Obligations by Borrower and specifically agrees that this Guaranty
shall be valid and binding as to the Guarantors in any event without regard to
whether or not it is enforceable against Borrower.
13. Payments. All payments hereunder shall be made to the Lender
at its office at 2841 E. Andrew Johnson Highway, Greeneville, Tennessee 37745,
or to such other address as the Lender may advise the Guarantors.
14. Severability. If any term of this Guaranty, or the application
thereof to any person or circumstances, shall, to any extent, be invalid or
unenforceable, the remainder of this Guaranty, or the application of such term
to persons or circumstances other than those as to which it is invalid or
unenforceable, shall not be affected thereby, and each term of this Guaranty
shall be valid and enforceable to the fullest extent permitted by law.
15. Enforceability. It is the intention of the Guarantors and the
Lender that the Guaranteed Obligations hereunder shall be in, but not in excess
of, the maximum amount permitted by applicable federal bankruptcy, state
insolvency, or similar laws ("Applicable Law"). To that end, but only to the
extent such obligations would otherwise be subject to avoidance under Applicable
Law if the Guarantors are not deemed to have received valuable consideration,
fair value or reasonably equivalent value for its obligations hereunder, the
Guarantors' obligations hereunder shall be reduced to that amount which, after
giving effect thereto, would not render the Guarantors insolvent, or cause the
Guarantors to have incurred debts (or intended to have incurred debts) beyond
its ability to pay such debts as they mature, at the time such obligations are
deemed to have been incurred under Applicable Law. As used herein, the terms
"insolvent" and "unreasonably small capital" shall likewise be determined in
accordance with Applicable Law. This Section is intended solely to preserve the
rights of the Lender hereunder to the maximum extent permitted by Applicable
Law, and neither the Guarantors nor any other person shall have any right or
claim under this Section that would not otherwise be available under Applicable
Law.
16. Notices. All notices to be given pursuant to this Guaranty
shall be sufficient if personally delivered or if mailed by U. S. Mail, postage
prepaid, certified or registered mail, return receipt requested, or forwarded by
a nationally recognized overnight courier service or telecopier facsimile
transmission, to the addresses of the parties hereto given above and/or
telecopier numbers specified in any document(s) executed by the parties hereto,
or to such other address and/or telecopier number as a party may request in
writing. Any time period provided in
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the giving of any notice hereunder shall commence upon the date such notice is
deposited in the mail or with such courier service, as applicable.
17. General Construction. The gender and number used in this
Guaranty are used as a reference term only and shall apply with the same effect
whether the parties are of the masculine or feminine gender, corporate or other
form, and the singular shall likewise include the plural.
18. Entire Agreement. The entirety of this Guaranty is set forth
herein and in the documents referred to herein and there is no other verbal or
other agreement, understanding or custom affecting this Guaranty. This Guaranty
may not be amended, modified or changed nor shall any waiver of any provision
hereof be effective, except only by an instru+ ment in writing and signed by the
party against whom enforcement of any waiver, amendment, change, modification or
discharge is sought.
19. Governing Law. This Guaranty and all rights, obligations and
liabilities arising hereunder shall be interpreted and construed according to
the laws of the State of Tennessee without reference to the conflicts or choice
of law principles thereof, except to the extent that the laws of a particular
jurisdiction govern the creation, perfection and enforcement of liens and
security interests in collateral.
20. Successors and Assigns. This Guaranty shall be binding upon
the Guarantors, their successors and assigns, and all rights against the
Guarantors arising under this Guaranty shall be for the sole benefit of the
Lender.
IN WITNESS WHEREOF, the Guarantors have caused this Guaranty to be
executed and the Lender has caused this Guaranty to be accepted as of the date
first above written.
---------------------------------
Scott M. Niswonger
---------------------------------
John A. Tweed
Accepted by:
FIRST TENNESSEE NATIONAL BANK
NATIONAL ASSOCIATION
By:
-----------------------------
Title:
--------------------------
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STATE OF )
------------------ )
COUNTY OF )
----------------
Before me, the undersigned, a Notary Public in and for the state and
county aforesaid, personally appeared ______________________, with whom I am
personally acquainted (or proved to me on the basis of satisfactory evidence),
and who, upon oath, acknowledged himself to be a ____________________ of LANDAIR
ACQUISITION CORPORATION, the within named bargainor, a Tennessee corporation,
and that he, as such _________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the association by himself as ___________________.
Witness my hand and seal on this the ________ day of January, 2003.
----------------------------------
Notary Public
My Commission Expires:
- ---------------------------
STATE OF )
------------------ )
COUNTY OF )
-----------------
Before me, the undersigned, a Notary Public in and for the state and
county aforesaid, personally appeared SCOTT M. NISWONGER, with whom I am
personally acquainted (or proved to me on the basis of satisfactory evidence),
and who, upon oath, acknowledged him/herself to be the
Witness my hand and seal on this the ________ day of January, 2003.
----------------------------------
Notary Public
My Commission Expires:
- ---------------------------
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STATE OF )
------------------ )
COUNTY OF )
-----------------
Before me, the undersigned, a Notary Public in and for the state and
county aforesaid, personally appeared JOHN A. TWEED, with whom I am personally
acquainted (or proved to me on the basis of satisfactory evidence), and who,
upon oath, acknowledged him/herself to be the
Witness my hand and seal on this the ________ day of January, 2003.
----------------------------------
Notary Public
My Commission Expires:
- --------------------------------
STATE OF )
------------------ )
COUNTY OF )
-----------------
Before me, the undersigned, a Notary Public in and for the state and
county aforesaid, personally appeared ______________________, with whom I am
personally acquainted (or proved to me on the basis of satisfactory evidence),
and who, upon oath, acknowledged himself to be a ____________________ of FIRST
TENNESSEE BANK NATIONAL ASSOCIATION, the within named bargainor, a national
banking association, and that he, as such Senior Vice President, being
authorized so to do, executed the foregoing instrument for the purposes therein
contained, by signing the name of the association by himself as
___________________.
Witness my hand and seal on this the ________ day of January, 2003.
----------------------------------
Notary Public
My Commission Expires:
- ---------------------------
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