1
EXHIBIT 99.5
Guaranty dated as of December 22, 1993 by the Registrant in
favor of Bank of America National Trust and Savings
Association, as agent.
2
EXHIBIT 99.5
GUARANTY
This GUARANTY (this "Guaranty"), dated as of December 22,
1993, is made by SPELLING ENTERTAINMENT GROUP INC., a Florida corporation (the
"Guarantor"), in favor of BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION as agent (the "Agent") for its benefit and for the ratable benefit
of the Banks party to the Amended and Restated Credit Agreement.
WHEREAS, BLOCKBUSTER ENTERTAINMENT CORPORATION, a Delaware
corporation (the "Company"), the Designated Subsidiaries of the Company, the
Banks and Bank of America National Trust and Savings Association as Agent, and
BA Securities, Inc., as Arranger have entered into an Amended and Restated
Credit Agreement dated as of the date hereof (such Amended and Restated Credit
Agreement, as it may hereafter be amended, restated, supplemented, or otherwise
modified from time to time, the "Amended and Restated Credit Agreement"); and
WHEREAS, each Subsidiary is a subsidiary of the Company and is
engaged in related businesses and each of the Subsidiaries will derive direct
and indirect economic benefit from all of the Loans (as defined in the Amended
and Restated Credit Agreement) made to the Company;
WHEREAS, the Guarantor and the Company have agreed that
following the execution of this Guaranty, the Guarantor and the Company will
enter into a credit agreement (the "Intercompany Credit Agreement"), pursuant
to which the Company will make certain loans to the Guarantor from time to
time.
NOW, THEREFORE, in consideration of the premises and in order
to induce the Banks to make Loans under the Amended and Restated Credit
Agreement, the Guarantor hereby agrees for the benefit of the Agent and for the
ratable benefit of the Banks (all such beneficially interested parties being
hereinafter sometimes referred to collectively as the "Secured Parties") as
follows:
1. Defined Terms. Unless otherwise defined herein,
terms defined in the Amended and Restated Credit Agreement are used herein as
therein defined.
2. Guaranty. The Guarantor hereby unconditionally and
irrevocably, guarantees the prompt performance and payment in full by the
Company when due (whether at stated maturity, by acceleration or otherwise) of
all the Company's obligations arising under, pursuant to or in connection with,
the Amended and Restated Credit Agreement and the other Loan Documents (all
such obligations being hereinafter referred to as the "Obligations"), and the
Guarantor further agrees to pay all reasonable costs, fees and expenses
(including counsel fees, including the allocated cost of in-house counsel)
incurred by any Secured Party in enforcing any rights under this Guaranty;
provided, however, that the Guarantor shall be liable under this Guaranty only
for the maximum amount of such liability that can be hereby incurred without
rendering this Guaranty voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer, and not for any greater amount; provided
further that in no event shall the
3
Guarantor's liability under this Section 2 exceed the amount of the Guarantor's
obligations to the Company under the Intercompany Credit Agreement at the time
of enforcement hereof.
3. Guaranty Absolute.
(a) This Guaranty is an unconditional and absolute
guaranty of payment and of performance. It shall be enforceable against the
Guarantor, its successors and assigns, without the necessity of resorting to
any suit against any other party or exhausting any other security or
collateral. The Guarantor waives the right to have the Banks or the Agent
pursue any other remedy, enforce any other rights, and the right to receive
notice of non-payment, non-performance or non-observance, non-acceptance,
demand or any other notice or demand to which the Guarantor might otherwise be
entitled. The Guarantor guarantees that all amounts payable by the Company will
be paid strictly in accordance with the terms of the Amended and Restated
Credit Agreement and the other Loan Documents, regardless of any law,
regulation or order, now or hereafter in effect in any jurisdiction affecting
any of such terms or the rights of the Agent or the Banks with respect thereto.
(b) This Guaranty is a guaranty of payment and the
obligations of the Guarantor contained herein shall be primary obligations and
debts of the Guarantor. Accordingly, the Banks or the Agent shall not be
obliged before enforcing such obligations to make any demand of the Company, to
take any action or proceedings or obtain judgment in any court against the
Company or to make or file any proof of claim in a liquidation or insolvency of
the Company and the Guarantor hereby expressly waives presentment, acceptance,
demand for payment, protest and notice of dishonor.
(c) The Guarantor shall not be exonerated or
discharged from liability hereunder by any time or grace period given to the
Company or by any other indulgence or concession granted to the Company or by
any other dealing or thing including, without limitation, any circumstances
whatsoever affecting or preventing a recovery of amounts due under the Amended
and Restated Credit Agreement or the other Loan Documents which, but for this
provision, might operate to exonerate or discharge the Guarantor from its
obligations hereunder.
(d) This Guaranty shall be a continuing guaranty, and
the obligations and liability of the Guarantor hereunder shall in no way be
affected, impaired, released, reduced or discharged by reason of the occurrence
of any of the following, although without further notice to or consent of the
Guarantor:
(i) the amendment, modification or supplement
(whether material or otherwise) of the Amended and Restated
Credit Agreement or the other Loan Documents;
(ii) the assertion of any of the rights or remedies
of the Banks or the Agent under the Amended and Restated
Credit Agreement or the other Loan Documents;
2
4
(iii) the failure, omission or delay on the part of
the Banks or the Agent to enforce, assert or exercise any
right, power or remedy conferred on or available to the Banks
or the Agent under the Amended and Restated Credit Agreement
or the other Loan Documents;
(iv) any bankruptcy, insolvency, reorganization,
arrangement, assignment for the benefit of creditors,
receivership or trusteeship affecting the Company;
(v) any lack of validity or enforceability of the
Amended and Restated Credit Agreement, the other Loan
Documents or any other agreement or instrument relating
thereto;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or
consent to departure from any other guaranty, for all or any
of the Obligations; or
(vii) any other circumstances which might otherwise
constitute a defense available to, or a discharge of, the
Guarantor.
(e) This Guaranty shall continue to be effective or
be reinstated, as the case may be, if at any time, any payment of any amounts
payable by the Company is rescinded or must otherwise be returned by the Agent
or any Bank upon the insolvency, bankruptcy or reorganization of the Company or
otherwise, all as though such payment had not been made.
(f) If an event permitting the acceleration of any of
the Obligations shall any time have occurred and be continuing and such
acceleration shall at such time be prevented by reason of the pendency against
the Company of a case or proceeding under any bankruptcy or insolvency law, the
Guarantor agrees that, for purposes of this Guaranty and its obligations
hereunder, the Obligations shall be deemed to have been accelerated and the
Guarantor shall forthwith pay such Obligations, and the other obligations
hereunder, without any further notice or demand, (including interest which but
for the filing of a petition in bankruptcy with respect to the Company, would
accrue on such Obligations).
4. Taxes and payments.
(a) Subject to the requirements of Section 3.01(g) of
the Amended and Restated Credit Agreement, each payment to be made by the
Guarantor under this Guaranty or in connection herewith to any Person shall be
made free and clear of, and without deduction or withholding for or on account
of any tax, reserve, levy or duty of, or imposed by, any governmental or taxing
authority in any jurisdiction unless the Guarantor is required to make such a
payment subject to the deduction or withholding of such tax, in which case the
amount payable by the Guarantor in respect of which such deduction or
withholding is required to be made shall be increased to the extent necessary
to ensure that, after the making of such deduction or withholding (to the
extent provided in Section 3.01(d)(ii) the Amended and Restated Credit
Agreement), such other party receives and retains (free from any liability in
respect of any such deduction or withholding) a net amount equal to the amount
which it would have
3
5
received and so retained had no such deduction or withholding been made or
required to be made.
(b) All payments made by the Guarantor shall be made
free and clear of and without any deduction for or on account of any set-off or
counterclaim or any other matter.
5. Waivers.
(a) The Guarantor expressly waives any and all rights
of subrogation, reimbursement and contribution, exoneration and indemnity
(contractual, statutory or otherwise), including without limitation, any claim
or right of subrogation under the Bankruptcy Code (Title 11 of the U.S. Code)
or any successor statute, arising from the existence or performance of this
Guaranty and the Guarantor irrevocably waives any right to enforce any remedy
which the Banks now have or may hereafter have against the Company, and waives
any benefit of, and any right to participate in, any security now or hereafter
held by the Banks. The provisions of this Section 5 shall survive the
termination of the Amended and Restated Credit Agreement and the payment in
full of the Obligations.
(b) The Guarantor hereby waives promptness,
diligence, notice of acceptance and any and all other notices with respect to
any of the Obligations and this Guaranty and any requirement that the Agent or
any Bank protect, secure, perfect or insure any security interest in or any
Lien on any property subject thereto or exhaust any right or take any action
against the Company, any other guarantor or any other obligor or any other
Person or any collateral or security or to any balance of any deposit accounts
or credit on the books of any Bank in favor of the Company or the guarantor.
6. Representations and Warranties. The Guarantor
represents and warrants to each Secured Party as follows:
(a) the Guarantor:
(i) is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation;
(ii) has the power and authority and all material
governmental licenses, authorizations, consents and approvals
to own its assets, carry on its business and to execute,
deliver, and perform its obligations under, this Guaranty;
(iii) is duly qualified as a foreign corporation,
licensed and in good standing under the laws of each
jurisdiction where failure to qualify would have a Material
Adverse Effect; and
(iv) is in compliance in all material respects with
all Requirements of Law.
(b) The execution, delivery and performance by the
Company of this Guaranty have been duly authorized by all necessary corporate
action, and do not and will not:
4
6
(i) contravene the terms of any of the Guarantor's
Organization Documents;
(ii) conflict with or result in any breach or
contravention of, or the creation of any Lien under, any
document evidencing any Contractual Obligation to which the
Guarantor is a party or any order, injunction, writ or decree
of any Governmental Authority to which the Guarantor or its
Property is subject; or
(iii) violate any Requirement of Law.
(c) No approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental Authority is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, the Guarantor of this Guaranty.
(d) This Guaranty constitutes the legal, valid and
binding obligation of the Guarantor, enforceable against the Guarantor in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles relating
to enforceability.
(e) Except as specifically disclosed in Schedule 5.05
to the Amended and Restated Credit Agreement, there are no actions, suits,
proceedings, claims or disputes pending, or to the best knowledge of the
Guarantor, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, against the Guarantor or any of its
Properties which:
(i) purport to affect the legality, validity or
enforceability of this Guaranty, or any of the transactions
contemplated hereby or thereby; or
(ii) if determined adversely to the Guarantor would
reasonably be expected to have a Material Adverse Effect. No
injunction, writ, temporary restraining order or any order of
any nature has been issued by any court or other Governmental
Authority purporting to enjoin or restrain the execution,
delivery and performance of this Guaranty, or directing that
the transactions provided for herein or therein not be
consummated as herein or therein provided.
(f) Each other representation and warranty made by
the Company in Article V of the Amended and Restated Credit Agreement
concerning the Guarantor is true and correct in all material respects.
The representations and warranties set forth in this
Section 6 shall survive the execution and delivery of this Guaranty.
5
7
7. Miscellaneous.
(a) All of the rights and remedies of the Banks and
the Agent under this Guaranty are intended to be distinct, separate and
cumulative and no such right or remedy is intended to be an exclusion of or a
waiver of any of the others. All rights and remedies may be enforced
concurrently, separately, in any order and in any combination.
(b) THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. THE GUARANTOR HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY
LITIGATION WHICH THE GUARANTOR, THE AGENT OR ANY OF THE BANKS SHALL BE ADVERSE
PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date first above written.
SPELLING ENTERTAINMENT GROUP INC.,
a Florida corporation
By: _______________________________
Title: Steven R. Berrard,
Vice Chairman, President
and Chief Executive Officer
Address: c/o 200 South Andrews Avenue
Fort Lauderdale, Florida 33301
Attn: Thomas W. Hawkins, Esq.
Tel: 305-832-3000
Fax: 305-832-3929
6