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EXHIBIT 99.4
Guaranty dated as of January 31, 1994, by the Registrant and
certain subsidiaries of the Registrant in favor of Blockbuster
Entertainment Corporation.
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EXHIBIT 99.4
GUARANTY
This GUARANTY is entered into as of January 31, 1994 by
Spelling Entertainment Group Inc. ("SEGI"), Spelling Entertainment Inc.
("SEI"), Aaron Spelling Productions, Inc. ("ASP"), Spelling Films
International, Inc. ("SFI"), Spelling Television, Inc. ("STI"), Torand
Productions Inc. ("TPI"), Worldvision Enterprises, Inc. ("Worldvision"), Laurel
Entertainment, Inc. ("Laurel"), Hamilton Projects, Inc. ("Hamilton"), Laurel
TV, Inc. ("LTV"), Laurel-King, Inc. ("LKI"), Laurel EFX, Inc. ("LEI"), Laurel
Pictures Inc. ("LPI") and the other present or future subsidiaries of SEGI that
are from time to time party hereto (each a "GUARANTOR" and collectively,
"GUARANTORS") in favor of and for the benefit of Blockbuster Entertainment
Corporation ("LENDER").
RECITALS
A. SEGI, SEI, ASP, SFI, STI, TPI, Worldvision, Laurel,
Hamilton, LTV, LKI, LEI and LPI (individually a "BORROWER" and collectively the
"BORROWERS"; as used herein the terms "Borrower" and "Borrowers" shall also
include any present or future subsidiary(ies) of SEGI that hereinafter becomes
a Borrower under the Credit Agreement (as hereinafter defined) pursuant to the
terms thereof) and Lender have entered into a Credit Agreement dated as of
January 31, 1994 (said Credit Agreement, as it may hereafter be amended,
supplemented or otherwise modified from time to time including, without
limitation, by the joinder of additional present or future subsidiaries of SEGI
as borrowers thereunder, being the "Credit Agreement"; capitalized terms used
herein without definition shall have the meanings assigned those terms in the
Credit Agreement);
B. Lender is willing to extend credit facilities to
Borrowers on a joint and several basis as provided in the Credit Agreement,
upon the condition that Borrowers' Credit Indebtedness thereunder and under the
other Credit Documents be guaranteed by Guarantors, as set forth below.
C. A portion of the proceeds of the Loans may be
advanced to Guarantors and thus the Guarantied Obligations (as hereinafter
defined) are being incurred for and will inure to the benefit of Guarantors
(which benefits are hereby acknowledged).
D. It is a condition precedent to the making of the
initial Loans under the Credit Agreement that each Borrower's Credit
Obligations thereunder and under the other Credit Documents be guarantied by
Guarantors.
E. Guarantors are willing irrevocably and
unconditionally to guaranty such obligations of Borrowers.
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NOW, THEREFORE, based upon the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and in order to induce Lender to enter into the Credit Agreement
and to make the Loans thereunder, Guarantors hereby agree as follows:
SECTION 1. DEFINITION.
1.1 CERTAIN DEFINED TERMS. As used in this Guaranty, the
following terms shall have the following meanings unless the context otherwise
requires:
"GUARANTIED OBLIGATIONS" has the meaning assigned to that term
in subsection 2.1.
"GUARANTY" means this Guaranty dated as of January 31, 1994,
as it may be amended, supplemented or otherwise modified from time to
time.
"PAYMENT IN FULL", "PAID IN FULL" or any similar term means
payment in full of the Guarantied Obligations including, without
limitation, all principal, interest, costs, fees and expenses
(including, without limitation, legal fees and expenses) of Lender as
required under the Credit Documents.
1.2 INTERPRETATION.
(a) References to "Sections" and "subsections" shall be
to Sections and subsections, respectively, of this Guaranty unless
otherwise specifically provided.
(b) In the event of any conflict or inconsistency between
the terms, conditions and provisions of this Guaranty and the terms,
conditions and provisions of the Credit Agreement, the terms,
conditions and provisions of this Guaranty shall prevail.
SECTION 2. THE GUARANTY
2.1 GUARANTY OF THE GUARANTIED OBLIGATIONS. Subject to the
provisions of subsection 2.2(a), Guarantors jointly and severally hereby
irrevocably and unconditionally guaranty, as primary obligors and not merely as
sureties, the due and punctual payment in full of all Guarantied Obligations
when the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would become due but for the operation of the automatic stay under Section
362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)). The term
"GUARANTIED OBLIGATIONS" is used herein in its most comprehensive sense and
includes:
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(a) any and all Credit Obligations now or hereafter made,
incurred or created, whether absolute or contingent, liquidated or
unliquidated, whether due or not due, and however arising under or in
connection with the Credit Agreement and the other Credit Documents,
including those arising under successive borrowing transactions under
the Credit Agreement which shall either continue the Credit
Obligations or from time to time renew them after they have been
satisfied; and
(b) those expenses set forth in subsection 2.9 hereof.
2.2 LIMITATION ON AMOUNT GUARANTIED; CONTRIBUTION BY GUARANTORS.
(a) Anything contained in this Guaranty to the contrary
notwithstanding, the obligations of each Guarantor hereunder (other than the
obligations of SEGI hereunder) shall be limited to a maximum aggregate amount
equal to the largest amount that would not render its obligations hereunder
subject to avoidance as a fraudulent transfer or conveyance under Section 548
of Title 11 of the United States Code or any applicable provisions of
comparable state law (collectively, the "FRAUDULENT TRANSFER LAWS"), in each
case after giving effect to all other liabilities of such Guarantor, contingent
or otherwise, that are relevant under the Fraudulent Transfer Laws
(specifically excluding, however, any liabilities of such Guarantor (x) in
respect of intercompany indebtedness to Borrowers or other affiliates of
Borrowers to the extent that such indebtedness would be discharged in an amount
equal to the amount paid by such Guarantor hereunder and (y) under any guaranty
of Indebtedness which by its terms is subordinated to the Credit Obligations
and which guaranty contains a limitation as to maximum amount similar to that
set forth in this subsection 2.2(a), pursuant to which the liability of such
Guarantor hereunder is included in the liabilities taken into account in
determining such maximum amount) and after giving effect as assets to the value
(as determined under the applicable provisions of the Fraudulent Transfer Laws)
of any rights to subrogation, reimbursement or contribution of such Guarantor
pursuant to (i) applicable law or (ii) any agreement providing for an equitable
allocation among such Guarantor and other affiliates of Borrowers of
obligations arising under guaranties by such parties.
(b) Guarantors under this Guaranty together desire to
allocate among themselves (collectively, the "CONTRIBUTING GUARANTORS"), in a
fair and equitable manner, their obligations arising under this Guaranty.
Accordingly, in the event any payment or distribution is made on any date by
any Guarantor under this Guaranty (a "FUNDING GUARANTOR") that exceeds its Fair
Share (as defined below) as of such date, that Funding Guarantor shall be
entitled to a contribution from each of the other Contributing Guarantors in
the amount of such other Contributing
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Guarantor's Fair Share Shortfall (as defined below) as of such date, with the
result that all such contributions will cause each Contributing Guarantor's
Aggregate Payments (as defined below) to equal its Fair Share as of such date.
"FAIR SHARE" means, with respect to a Contributing Guarantor as of any date of
determination, an amount equal to (i) the ratio of (x) the Adjusted Maximum
Amount (as defined below) with respect to such Contributing Guarantor to (y)
the aggregate of the Adjusted Maximum Amounts with respect to all Contributing
Guarantors, multiplied by (ii) the aggregate amount paid or distributed on or
before such date by all Funding Guarantors under this Guaranty in respect of
the obligations guarantied. "FAIR SHARE SHORTFALL" means, with respect to a
Contributing Guarantor as of any date of determination, the excess, if any, of
the Fair Share of such Contributing Guarantor over the Aggregate Payments of
such Contributing Guarantor. "ADJUSTED MAXIMUM AMOUNT" means, with respect to
a Contributing Guarantor as of any date of determination, the maximum aggregate
amount of the obligations of such Contributing Guarantor under this Guaranty,
determined as of such date in accordance with subsection 2.2(a); provided that,
solely for purposes of calculating the "Adjusted Maximum Amount" with respect
to any Contributing Guarantor for purposes of this subsection 2.2(b), any
assets or liabilities of such Contributing Guarantor arising by virtue of any
rights to subrogation or reimbursement or any rights to or obligations of
contribution hereunder shall not be considered as assets or liabilities of such
Contributing Guarantor. "AGGREGATE PAYMENTS" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (i)
the aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Guaranty (including,
without limitation, in respect of this subsection 2.2(b) minus (ii) the
aggregate amount of all payments received on or before such date by such
Contributing Guarantor from the other Contributing Guarantors as contributions
under this subsection 2.2(b). The amounts payable as contributions hereunder
shall be determined as of the date on which the related payment or distribution
is made by the applicable Funding Guarantor. The allocation among Contributing
Guarantors of their obligations as set forth in this subsection 2.2(b) shall
not be construed in any way to limit the liability of any Contributing
Guarantor hereunder.
2.3 LIABILITY OF GUARANTORS ABSOLUTE. Each Guarantor agrees that
its obligations hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which constitutes a
legal or equitable discharge of a guarantor or surety other than indefeasible
payment in full of the Guarantied Obligations. In furtherance of the foregoing
and without limiting the generality thereof, each Guarantor agrees as follows:
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(a) This Guaranty is a guaranty of payment when due and
not of collectibility.
(b) Lender may enforce this Guaranty upon the occurrence
of an Event of Default under the Credit Agreement notwithstanding the
existence of any dispute between Lender and Borrowers with respect to
the existence of such Event of Default.
(c) The obligations of each Guarantor hereunder are
independent of the obligations of Borrowers under the Credit Documents
and the obligations of any other guarantor (including any other
Guarantor) of the obligations of Borrowers under the Credit Documents,
and a separate action or actions may be brought and prosecuted against
such Guarantor whether or not any action is brought against Borrowers,
or any of them, or any of such other guarantors and whether or not
Borrowers are joined in any such action or actions.
(d) Payment by any Guarantor of a portion, but not all,
of the Guarantied Obligations shall in no way limit, affect, modify or
abridge any Guarantor's liability for any portion of the Guarantied
Obligations which has not been paid. Without limiting the generality
of the foregoing, if Lender is awarded a judgment in any suit brought
to enforce any Guarantor's covenant to pay a portion of the Guarantied
Obligations, such judgment shall not be deemed to release such
Guarantor from its covenant to pay the portion of the Guarantied
Obligations that is not the subject of such suit, and such judgment
shall not, except to the extent satisfied by such Guarantor, limit,
affect, modify or abridge any other Guarantor's liability hereunder in
respect of the Guarantied Obligations.
(e) Lender, upon such terms as it deems appropriate,
without notice or demand and without affecting the validity or
enforceability of this Guaranty or giving rise to any reduction,
limitation, impairment, discharge or termination of any Guarantor's
liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the
time, place, manner or terms of payment of the Guarantied Obligations,
(ii) settle, compromise, release or discharge, or accept or refuse any
offer of performance with respect to, or substitutions for, the
Guarantied Obligations or any agreement relating thereto and/or
subordinate the payment of the same to the payment of any other
obligations; (iii) request and accept other guaranties of the
Guarantied Obligations and take and hold security for the payment of
this Guaranty or the Guarantied Obligations; (iv) release, surrender,
exchange, substitute, compromise, settle, rescind, waive, alter,
subordinate or modify, with or without consideration, any security for
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payment of the Guarantied Obligations, any other guaranties of the
Guarantied Obligations, or any other obligation of any Person
(including any other Guarantor) with respect to the Guarantied
Obligations; (v) enforce and apply any security now or hereafter held
by or for the benefit of Lender in respect of this Guaranty or the
Guarantied Obligations and direct the order or manner of sale thereof,
or exercise any other right or remedy that Lender may have against any
such security, as Lender in its discretion may determine consistent
with the Credit Agreement and any applicable security agreement,
including foreclosure on any such security pursuant to one or more
judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable, and even though such action operates
to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of any Guarantor against Borrowers, or any of
them, or any security for the Guarantied Obligations; and (vi)
exercise any other rights available to it under the Credit Documents.
(f) This Guaranty and the obligations of Guarantors
hereunder shall be valid and enforceable and shall not be subject to
any reduction, limitation, impairment, discharge or termination for
any reason (other than indefeasible payment in full of the Guarantied
Obligations), including without limitation the occurrence of any of
the following, whether or not any Guarantor shall have had notice or
knowledge of any of them: (i) any failure or omission to assert or
enforce or agreement or election not to assert or enforce, or the stay
or enjoining, by order of court, by operation of law or otherwise, of
the exercise or enforcement of, any claim or demand or any right,
power or remedy (whether arising under the Credit Documents, at law,
in equity or otherwise) with respect to the Guarantied Obligations or
any agreement relating thereto, or with respect to any other guaranty
of or security for the payment of the Guarantied Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to
departure from, any of the terms or provisions (including without
limitation provisions relating to events of default) of the Credit
Agreement, any of the other Credit Documents or any agreement or
instrument executed pursuant thereto, or of any other guaranty or
security for the Guarantied Obligations, in each case whether or not
in accordance with the terms of the Credit Agreement or such Credit
Document or any agreement relating to such other guaranty or security;
(iii) the Guarantied Obligations, or any agreement relating thereto,
at any time being found to be illegal, invalid or unenforceable in any
respect; (iv) the application of payments received from any source
(other than payments received pursuant to the other Credit Documents
or from the proceeds of any security for the Guarantied Obligations,
except to the extent such security also serves as collateral
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for indebtedness other than the Guarantied Obligations) to the payment
of indebtedness other than the Guarantied Obligations, even though
Lender might have elected to apply such payment to any part or all of
the Guarantied Obligations; (v) Lender's consent to the change,
reorganization or termination of the corporate structure or existence
of SEI or any of its Subsidiaries and to any corresponding
restructuring of the Guarantied Obligations; (vi) any failure to
perfect or continue perfection of a security interest in any
collateral which secures any of the Guarantied Obligations; (vii) any
defenses, set-offs or counterclaims which Borrowers, or any of them,
may allege or assert against Lender in respect of the Guarantied
Obligations, including but not limited to failure of consideration,
breach of warranty, payment, statute of frauds, statute of
limitations, accord and satisfaction and usury; and (viii) any other
act or thing or omission, or delay to do any other act or thing, which
may or might in any manner or to any extent vary the risk of any
Guarantor as an obligor in respect of the Guarantied Obligations.
2.4 WAIVERS BY GUARANTORS. Each Guarantor hereby waives, for the
benefit of Lender:
(a) any right to require Lender, as a condition of
payment or performance by such Guarantor, to (i) proceed against
Borrowers, or any of them, any other guarantor (including any other
Guarantor) of the Guarantied Obligations or any other Person, (ii)
proceed against or exhaust any security held from Borrowers, or any of
them, any other guarantor (including any other Guarantor) of the
Guarantied Obligations or any other Person, (iii) proceed against or
have resort to any balance of any deposit account or credit on the
books of Lender in favor of Borrowers, or any of them, or any other
Person, or (iv) pursue any other remedy in the power of Lender
whatsoever;
(b) any defense arising by reason of the incapacity, lack
of authority or any disability or other defense of Borrowers, or any
of them, including, without limitation, any defense based on or
arising out of the lack of validity or the unenforceability of the
Guarantied Obligations or any agreement or instrument relating thereto
or by reason of the cessation of the liability of Borrowers, or any of
them, from any cause other than indefeasible payment in full of the
Guarantied Obligations;
(c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger
in amount nor in other respects more burdensome than that of the
principal;
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(d) any defense based upon Lender's errors or omissions
in the administration of the Guarantied Obligations, except behavior
which amounts to bad faith;
(e) (i) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of this
Guaranty and any legal or equitable discharge of such Guarantor's
obligations hereunder, (ii) the benefit of any statute of limitations
affecting such Guarantor's liability hereunder or the enforcement
hereof, (iii) any rights to set-offs, recoupments and counterclaims,
and (iv) promptness, diligence and any requirement that Lender
protect, secure, perfect or insure any security interest or lien or
any property subject thereto;
(f) notices, demands, presentments, protests, notices of
protest, notices of dishonor and notices of any action or inaction,
including acceptance of this Guaranty, notices of default under the
Credit Agreement or any agreement or instrument related thereto,
notices of any renewal, extension or modification of the Guarantied
Obligations or any agreement related thereto, notices of any extension
of credit to the Borrowers, or any of them, and notices of any of the
matters referred to in subsection 2.3 and any right to consent to any
thereof; and
(g) any defenses or benefits that may be derived from or
afforded by law which limit the liability of or exonerate guarantors
or sureties, or which may conflict with the terms of this Guaranty,
including without limitation if and to the extent applicable, the
provisions of California Civil Code Sections 2809, 2810, 2819, 2839,
2845, 2846, 2849, 2850, 2899 and 3433.
2.5 PAYMENT BY GUARANTORS; APPLICATION OF PAYMENTS. Subject to
the provisions of subsection 2.2(a), Guarantors hereby jointly and severally
agree, in furtherance of the foregoing and not in limitation of any other right
which Lender or any other Person may have at law or in equity against any
Guarantor by virtue hereof, that upon the failure of Borrowers, or any of them,
to pay any of the Guarantied Obligations when and as the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11
U.S.C. Section 362(a) or the operation of any other provision of law or any
jurisdiction which would otherwise cause a stay of the payment of such
amounts), Guarantors will upon demand pay, or cause to be paid, in cash, to
Lender, an amount equal to the sum of the unpaid principal amount of all
Guarantied Obligations then due as aforesaid, accrued and unpaid interest on
such Guarantied Obligations (including, without limitation, interest which, but
for the filing of a petition in bankruptcy with respect to
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Borrowers, or any of them, would have accrued on such Guarantied Obligations,
whether or not a claim is allowed against Borrowers, or any of them, for such
interest in any such bankruptcy proceeding) and all other Guarantied
Obligations then owed to Lender as aforesaid. All such payments shall be
applied promptly from time to time by Lender:
First, to the payment of the costs and expenses of any
collection or other realization under this Guaranty, including
reasonable compensation to Lender and its agents and counsel, and all
expenses, liabilities and advances made or incurred by Lender in
connection therewith;
Second, to the payment of all other Guarantied Obligations; and
Third, after payment in full of all Guarantied Obligations, to
the payment to Guarantors, or their respective successors or assigns,
or to whomsoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct, of any surplus then
remaining from such payments.
2.6 GUARANTORS' RIGHTS OF SUBROGATION, CONTRIBUTION, ETC. Each
Guarantor hereby waives any claim, right or remedy, direct or indirect, that
such Guarantor now has or may hereafter have against Borrowers, or any of them,
or any of their assets in connection with this Guaranty or the performance by
such Guarantor of its obligations hereunder, in each case whether such claim,
right or remedy arises in equity, under contract, by statute, under common law
or otherwise and including without limitation (a) any right of subrogation,
reimbursement or indemnification that such Guarantor now has or may hereafter
have against any Borrower, (b) any right to enforce, or to participate in, any
claim, right or remedy that Lender now has or may hereafter have against
Borrowers, or any of them, and (c) any benefit of, and any right to participate
in, any collateral or security now or hereafter held by Lender. In addition,
until the Guarantied Obligations shall have been indefeasibly paid in full and
the Commitment shall have terminated, each Guarantor shall withhold exercise of
any right of contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guarantied Obligations (including
without limitation any such right of contribution under subsection 2.2(b).
Each Guarantor further agrees that, to the extent the waiver or withholding of
its rights of subrogation, reimbursement, indemnification and contribution as
set forth herein is found by a court of competent jurisdiction to be void or
voidable for any reason, any rights of subrogation, reimbursement or
indemnification such Guarantor may have against Borrowers, or any of them, or
against any collateral or security, and any rights of contribution such
Guarantor may have against any such other guarantor, shall be junior and
subordinate to any rights Lender
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may have against Borrowers, or any of them, to all right, title and interest
Lender may have in any such collateral or security, and to any right Lender may
have against such other guarantor. Lender may use, sell or dispose of any item
of collateral or security as it sees fit without regard to any subrogation
rights any Guarantor may have, and upon any such disposition or sale any rights
of subrogation such Guarantor may have shall terminate. If any amount shall be
paid to any Guarantor on account of any such subrogation, reimbursement or
indemnification rights at any time when all Guarantied Obligations shall not
have been paid in full, such amount shall be held in trust for Lender and shall
forthwith be paid over to Lender to be credited and applied against the
Guarantied Obligations, whether matured or unmatured, in accordance with the
terms hereof.
2.7 SUBORDINATION OF OTHER OBLIGATIONS. Any indebtedness of
Borrowers, or any of them, now or hereafter held by any Guarantor is hereby
subordinated in right of payment to the Guarantied Obligations, and any such
indebtedness of Borrowers, or any of them, to such Guarantor collected or
received by such Guarantor after an Event of Default has occurred and is
continuing shall be held in trust for Lender and shall forthwith be paid over
to Lender to be credited and applied against the Guarantied Obligations but
without affecting, impairing or limiting in any manner the liability of such
Guarantor under any other provision of this Guaranty.
2.8 REAL PROPERTY SECURITY. Each Guarantor agrees that, if all or
a portion of the Guarantied Obligations are at any time secured by a deed of
trust or mortgage covering interests in real property, Lender or its designee,
in its sole discretion, without notice or demand and without affecting the
liability of any Guarantor under this Guaranty, may foreclose, pursuant to the
terms of the Credit Documents or otherwise, on such deed of trust or mortgage
and the interests in real property secured thereby by nonjudicial or other
sale. Each Guarantor understands (i) that the exercise by Lender, or any of
them, of certain rights and remedies contained in the Credit Agreement and
Borrowers, or any of them, such deed of trust or mortgage, including the right
to conduct such a nonjudicial foreclosure sale, may affect or eliminate such
Guarantor's right of subrogation against Borrowers, or any of them, (ii) that
such Guarantor may therefore incur a partially or totally nonreimbursable
liability hereunder, and (iii) that such actions by Lender that affect or
eliminate such right of subrogation may give rise to a defense by such
Guarantor to any liability under this Guaranty, absent a waiver of such defense
by such Guarantor. Nevertheless, each Guarantor hereby waives any such defense
and hereby authorizes and empowers Lender to exercise, in its sole discretion,
any rights and remedies, or any combination thereof, which may then be
available, since it is the intent and purpose of each Guarantor that the
obligations hereunder shall be absolute, independent and unconditional under
any and all circumstances. To the extent
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permitted by law, without limiting the generality of the foregoing, if and to
the extent found applicable, each Guarantor hereby expressly waives any and all
benefits under California Code of Civil Procedure Sections 580a, 580d and 726.
Notwithstanding any foreclosure of the lien of such deed of trust or mortgage
with respect to any or all real or personal property secured thereby, whether
by the exercise of the power of sale contained therein, by an action for
judicial foreclosure or by an acceptance of a deed in lieu of foreclosure, each
Guarantor shall remain bound under this Guaranty, including its obligation to
pay any deficiency after a nonjudicial foreclosure, even though such Guarantor
may have no right of subrogation against Borrowers, or any of them, as a result
thereof.
2.9 EXPENSES. Guarantors jointly and severally agree to pay, or
cause to be paid, on demand, and to save Lender harmless against liability for,
any and all costs and expenses (including fees and disbursements of counsel and
allocated costs of internal counsel) incurred or expended by Lender in
connection with the enforcement of or preservation of any rights under this
Guaranty.
2.10 CONTINUING GUARANTY. This Guaranty is a continuing guaranty
and shall remain in effect until all of the Guarantied Obligations shall have
been indefeasibly paid in full and the Commitment shall have terminated. Each
Guarantor hereby irrevocably waives any right (including without limitation if
and to the extent applicable, any such right arising under California Civil
Code Section 2815) to revoke this Guaranty as to future transactions giving
rise to any Guarantied Obligations.
2.11 AUTHORITY OF GUARANTORS OR BORROWERS. It is not necessary for
Lender to inquire into the capacity or powers of any Guarantor or any Borrower
or the officers, directors or any agents acting or purporting to act on behalf
of any of them.
2.12 FINANCIAL CONDITION OF BORROWERS. Any Loans may be granted to
Borrowers or continued from time to time without notice to or authorization
from any Guarantor regardless of the financial or other condition of Borrowers,
or any of them, at the time of any such grant or continuation. Lender shall
have no obligation to disclose or discuss with any Guarantor their assessment,
or any Guarantor's assessment, of the financial condition of Borrowers, or any
of them. Each Guarantor has adequate means to obtain information from
Borrowers on a continuing basis concerning the financial condition of Borrowers
and their ability to perform their obligations under the Credit Documents, and
each Guarantor assumes the responsibility for being and keeping informed of the
financial condition of Borrowers and of all circumstances bearing upon the risk
of nonpayment of the Guarantied Obligations. Each Guarantor hereby waives and
relinquishes any duty on the part of Lender to disclose any matter, fact or
thing relating to the business,
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operations or conditions of Borrowers, or any of them, now known or hereafter
known by Agent or any Lender.
2.13 RIGHTS CUMULATIVE. The rights, powers and remedies given to
Lender by this Guaranty are cumulative and shall be in addition to and
independent of all rights, powers and remedies given to Lender by virtue of any
statute or rule of law or in any of the other Credit Documents or any agreement
between any Guarantor and Lender between Borrowers, or any of them, and Lender.
Any forbearance or failure to exercise, and any delay by Lender in exercising,
any right, power or remedy hereunder shall not impair any such right, power or
remedy or be construed to be a waiver thereof, nor shall it preclude the
further exercise of any such right, power or remedy.
2.14 BANKRUPTCY; POST-PETITION INTEREST; REINSTATEMENT OF GUARANTY.
(a) So long as any Guarantied Obligations remain
outstanding, no Guarantor shall, without the prior written consent of Lender in
accordance with the terms of the Credit Agreement, commence or join with any
other Person in commencing any bankruptcy, reorganization or insolvency
proceedings of or against Borrowers, or any of them. The obligations of
Guarantors under this Guaranty shall not be reduced, limited, impaired,
discharged, deferred, suspended or terminated by any proceeding, voluntary or
involuntary, involving the bankruptcy, insolvency, receivership,
reorganization, liquidation or arrangement of Borrowers, or any of them, or by
any defense which Borrowers, or any of them, may have by reason of the order,
decree or decision of any court or administrative body resulting from any such
proceeding.
(b) Each Guarantor acknowledges and agrees that any
interest on any portion of the Guarantied Obligations which accrues after the
commencement of any proceeding referred to in clause (a) above (or, if interest
on any portion of the Guarantied Obligations ceases to accrue by operation of
law by reason of the commencement of said proceeding, such interest as would
have accrued on such portion of the Guarantied Obligations if said proceedings
had not been commenced) shall be included in the Guarantied Obligations because
it is the intention of Guarantors and Lender that the Guarantied Obligations
which are guarantied by Guarantors pursuant to this Guaranty should be
determined without regard to any rule of law or order which may relieve
Borrowers, or any of them, of any portion of such Guarantied Obligations.
Guarantors will permit any trustee in bankruptcy, receiver, debtor in
possession, assignee for the benefit of creditors or similar person to pay
Lender, or allow the claim of Lender in respect of, any such interest accruing
after the date on which such proceeding is commenced.
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(c) In the event that all or any portion of the
Guarantied Obligations are paid by any Borrower, the obligations of Guarantors
hereunder shall continue and remain in full force and effect or be reinstated,
as the case may be, in the event that all or any part of such payment(s) are
rescinded or recovered directly or indirectly from Lender as a preference,
fraudulent transfer or otherwise, and any such payments which are so rescinded
or recovered shall constitute Guarantied Obligations for all purposes under
this Guaranty.
2.15 SET OFF. In addition to any other rights Lender may have
under law or in equity, if any amount shall at any time be due and owing by any
Guarantor to Lender under this Guaranty, such Lender is authorized at any time
or from time to time, without notice (any such notice being hereby expressly
waived), to set off and to appropriate and to apply any and all indebtedness of
Lender owing to such Guarantor and any other property of such Guarantor held by
Lender to or for the credit or the account of such Guarantor against and on
account of the Guarantied Obligations and liabilities of such Guarantor to
Lender under this Guaranty.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce Lender to accept this Guaranty and to enter
into the Credit Agreement and to make the Loans thereunder, each Guarantor
hereby represents and warrants to Lender that the following statements are true
and correct:
3.1 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Such
Guarantor has the corporate power, authority and legal right to execute,
deliver and perform this Guaranty and all obligations required hereunder and
has taken all necessary corporate action to authorize its Guaranty hereunder on
the terms and conditions hereof and its execution, delivery and performance of
this Guaranty and all obligations required hereunder. No consent of any other
Person including, without limitation, stockholders and creditors of such
Guarantor, and no license, permit, approval or authorization of, exemption by,
notice or report to, or registration, filing or declaration with, any
governmental authority is required by such Guarantor in connection with this
Guaranty or the execution, delivery, performance, validity or enforceability of
this Guaranty and all obligations required hereunder. This Guaranty has been,
and each instrument or document required hereunder will be, executed and
delivered by a duly authorized officer of such Guarantor, and this Guaranty
constitutes, and each instrument or document required hereunder when executed
and delivered by such Guarantor hereunder will constitute, the legally valid
and binding obligation of such Guarantor, enforceable against such Guarantor in
accordance with its terms, except as enforcement may be limited by applicable
bankruptcy, insolvency, reorganization,
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moratorium or other similar laws or equitable principles relating to or
limiting creditors' rights generally.
3.2 NO LEGAL BAR TO THIS GUARANTY. The execution, delivery and
performance of this Guaranty and the documents or instruments required
hereunder, and the use of the proceeds of the borrowings under the Credit
Agreement, will not violate any provision of any existing law or regulation
binding on such Guarantor, or any order, judgment, award or decree of any
court, arbitrator or governmental authority binding on such Guarantor, or the
certificate of incorporation or bylaws of such Guarantor or any securities
issued by such Guarantor, or any mortgage, indenture, lease, contract or other
agreement, instrument or undertaking to which such Guarantor is a party or by
which such Guarantor or any of its assets may be bound, the violation of which
would have a material adverse effect on the business, operations, assets or
financial condition of such Guarantor and its Subsidiaries, taken as a whole,
and will not result in, or require, the creation or imposition of any Lien on
any of its property, assets or revenues pursuant to the provisions of any such
mortgage, indenture, lease, contract or other agreement, instrument or
undertaking.
3.3 CERTAIN GUARANTOR REPRESENTATIONS. Each Guarantor represents
that (a) it is in its best interest and in pursuit of its corporate purposes as
an integral part of the business conducted and proposed to be conducted by SEGI
and its Subsidiaries (including such Guarantor), and reasonably necessary and
convenient in connection with the conduct of the business conducted and
proposed to be conducted by it, to induce the Lender to enter into the Credit
Agreement and to extend credit to each Borrower by making the Guaranties
contemplated by this Guaranty, (b) the credit available under the Credit
Agreement will directly or indirectly inure to its benefit, and (c) by virtue
of the foregoing it is receiving at least reasonably equivalent consideration
from the Lender for its Guaranty. Each Guarantor acknowledges that it has been
advised by Lender that the Lender is unwilling to enter into the Credit
Agreement unless the Guaranties contemplated by this Guaranty are given by it.
Each Guarantor represents that (i) it will not be rendered insolvent as a
result of entering into this Guaranty, (ii) after giving effect to the
transactions contemplated by this Guaranty, it will have assets having a fair
saleable value in excess of the amount required to pay its probable liability
on its existing debts as they have become absolute and matured, (iii) it has,
and will have, access to adequate capital for the conduct of its business and
(iv) it has the ability to pay its debts from time to time incurred in
connection therewith as such debts mature.
SECTION 4. MISCELLANEOUS
4.1 SURVIVAL OF WARRANTIES. All agreements, representations and
warranties made herein shall survive the execution and
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delivery of this Guaranty, any increase in the Commitment under the Credit
Agreement and the execution and delivery of the Note.
4.2 NOTICES. Any communications between Lender and any Guarantor
and any notices or requests provided herein to be given may be given by mailing
the same, postage prepaid, or by telex, facsimile transmission or cable to each
such party at its address set forth in the Credit Agreement, on the signature
pages hereof or to such other addresses as each such party may in writing
hereafter indicate. Any notice, request or demand to or upon Lender or any
Guarantor shall not be effective until received.
4.3 SEVERABILITY. In case any provision in or obligation under
this Guaranty shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.
4.4 AMENDMENTS AND WAIVERS. No amendment, modification,
termination or waiver of any provision of this Guaranty, or consent to any
departure by any Guarantor therefrom, shall in any event be effective without
the written concurrence of Lender under the Credit Agreement. Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.
4.5 HEADINGS. Section and subsection headings in this Guaranty
are included herein for convenience of reference only and shall not constitute
a part of this Guaranty for any other purpose or be given any substantive
effect.
4.6 APPLICABLE LAW. THIS GUARANTY SHALL BE GOVERNED BY, AND SHALL
BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
4.7 SUCCESSORS AND ASSIGNS. This Guaranty is a continuing
guaranty and shall be binding upon each Guarantor and its respective successors
and assigns. This Guaranty shall inure to the benefit of Lender and its
respective successors and assigns. No Guarantor shall assign this Guaranty or
any of the rights or obligations of such Guarantor hereunder without the prior
written consent of Lender. Lender may, without notice or consent, assign its
interest in this Guaranty in whole or in part. The terms and provisions of
this Guaranty shall inure to the benefit of any transferee or assignee of any
Note, and in the event of such transfer or assignment the rights and privileges
herein conferred upon Lender shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.
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4.8 CONSENT TO JURISDICTION AND SERVICE OF PROCESS. ALL JUDICIAL
PROCEEDINGS BROUGHT AGAINST ANY GUARANTOR ARISING OUT OF OR RELATING TO THIS
GUARANTY MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION
IN THE STATES OF NEW YORK, FLORIDA AND CALIFORNIA, AND BY EXECUTION AND
DELIVERY OF THIS GUARANTY EACH GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY
IN CONNECTION WITH THIS GUARANTY. Each Guarantor designates and appoints
Spelling Entertainment Group Inc., and such other Persons as may hereafter be
selected by such Guarantor irrevocably agreeing in writing to so serve, as its
agent to receive on its behalf service of all process in any such proceedings
in any such court, such service being hereby acknowledged by such Guarantor to
be effective and binding service in every respect. A copy of any such process
so served shall be mailed by registered mail to such Guarantor at its address
provided in subsection 4.2; provided that, unless otherwise provided by
applicable law, any failure to mail such copy shall not affect the validity of
service of such process. If any agent appointed by any Guarantor refuses to
accept service, such Guarantor hereby agrees that service of process sufficient
for personal jurisdiction in any action against such Guarantor in the States of
New York, California and Florida may be made by registered or certified mail,
return receipt requested, to such Guarantor at its address provided in
subsection 4.2, and each Guarantor hereby acknowledges that such service shall
be effective and binding in every respect. Nothing herein shall affect the
right to serve process in any other manner permitted by law or shall limit the
right of Lender to bring proceedings against any Guarantor in the courts of any
other jurisdiction.
4.9 NO OTHER WRITING. This writing is intended by Guarantors and
Lender as the final expression of this Guaranty and is also intended as a
complete and exclusive statement of the terms of their agreement with respect
to the matters covered hereby. No course of dealing, course of performance or
trade usage, and no parol evidence of any nature, shall be used to supplement
or modify any terms of this Guaranty. There are no conditions to the full
effectiveness of this Guaranty.
4.10 FURTHER ASSURANCES. At any time or from time to time, upon
the request of Agent or Requisite Lenders, Guarantors shall execute and deliver
such further documents and do such other acts and things as Lender may
reasonably request in order to effect fully the purposes of this Guaranty.
4.11 ADDITIONAL SUBSIDIARY GUARANTORS. The initial Guarantors
hereunder shall be SEGI and such of the Subsidiaries of SEGI as are signatories
hereto on the date hereof. From time to time subsequent to the date hereof,
additional Subsidiaries of
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SEGI may become parties hereto, as additional Guarantors, by executing a
counterpart of this Guaranty. Upon delivery of any such counterpart to Lender,
notice of which is hereby waived by Guarantors, each such additional Guarantor
shall be as fully a party hereto as if such Guarantor were an original
signatory hereof. Each Guarantor expressly agrees that its obligations arising
hereunder shall not be affected or diminished by the addition or release of any
other Guarantor hereunder, nor by any election of Lender not to cause any
Subsidiary of SEGI to become an additional Guarantor hereunder. This Guaranty
shall be fully effective as to any Guarantor that is or becomes a party hereto
regardless of whether any other Person becomes or fails to become or ceases to
be a Guarantor hereunder. Each Guarantor shall from time to time cause any
present wholly owned subsidiary of Guarantor or future wholly owned subsidiary
of Guarantor, within 30 days after any such Person becomes a Subsidiary, that
is not a Guarantor to join this Guaranty as a Guarantor pursuant to a joinder
agreement in form and substance satisfactory to the Lender unless such
Subsidiary is a Subsidiary organized under the laws of a jurisdiction outside
of the United States and under applicable foreign law; such Subsidiary is not
permitted to guarantee the Credit Obligations. Each Guarantor will, promptly
upon the request of Lender from time to time, execute, acknowledge and deliver,
and file and record, all such instruments, and take all such action, as Lender
deems necessary or advisable to carry out the intent and purposes of this
Section 4.11.
4.12 COUNTERPARTS; EFFECTIVENESS. This Guaranty may be executed in
any number of counterparts and by the different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original for all purposes; but all such counterparts together shall
constitute but one and the same instrument. This Guaranty shall become
effective as to each Guarantor upon the execution of a counterpart hereof by
such Guarantor (whether or not a counterpart hereof shall have been executed by
any other Guarantor) and receipt by Lender of written or telephonic
notification of such execution and authorization of delivery thereof.
(Remainder of page intentionally left blank)
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IN WITNESS WHEREOF, each of the undersigned Guarantors has
executed this Guaranty by its duly authorized officer as of the date first
above written.
SPELLING ENTERTAINMENT GROUP INC.
By __________________________________
Title:
Address: One Blockbuster Plaza
200 South Andrews Avenue
Fort Lauderdale, Florida 33301
SPELLING ENTERTAINMENT INC.
By __________________________________
Title:
Address: 5700 Wilshire Boulevard
Los Angeles, California
AARON SPELLING PRODUCTIONS, INC.
LAUREL ENTERTAINMENT, INC.
SPELLING FILMS INTERNATIONAL INC.
SPELLING TELEVISION INC.
TORAND PRODUCTIONS INC.
WORLDVISION ENTERPRISES, INC.
HAMILTON PROJECTS, INC.
LAUREL TV, INC.
LAUREL-KING, INC.
LAUREL PICTURES INC.
By __________________________________
As an authorized officer of each
of the foregoing corporations
Address: 5700 Wilshire Boulevard
Los Angeles, California
S-1