Exhibit 10.16
UNCOMMITTED GUIDANCE LINE DEMAND PROMISSORY NOTE
$15,000,000.00 March 1, 1999
Atlanta, Georgia
FOR VALUE RECEIVED, HUGHES SUPPLY, INC., a Florida corporation (the
"Borrower" or the "undersigned"), promises to pay to the order of SUNTRUST BANK,
CENTRAL FLORIDA, NATIONAL ASSOCIATION, a national banking association, (the
"Lender"), at the principal office of the Lender, at 200 South Orange Avenue,
Orlando, Florida 32801, or at such other place as the Lender may designate by
notice in writing to the Borrower, in immediately available funds in lawful
money of the United States of America, the lesser of (x) the principal sum of
FIFTEEN MILLION AND NO/100 DOLLARS ($15,000,000.00), together with interest on
the unpaid principal balance of this Uncommitted Guidance Line Demand Promissory
Note (this "Note"), or (y) so much thereof as shall have been from time to time
disbursed hereunder in the sole discretion of the Lender, and not theretofore
repaid, as shown on the books and records of the Lender, at the rate per annum
mutually agreed upon from time to time by Borrower and Lender (the "Interest
Rate"), on the sooner of (i) DEMAND or (ii) January 25, 2000, or such later date
to which the Bank may extend this Note in writing and in its sole discretion,
(the "Termination Date").
Upon the terms of this Note and in compliance with the terms and conditions
hereof, the Borrower, from time to time, may request advances hereunder, repay
and reborrow up to the maximum aggregate principal amount outstanding at any one
time as indicated above, subject to the sole discretion of the Lender. The
Borrower acknowledges and agrees that the Lender shall have no obligation to
make any advances to the Borrower under this Note, but the Lender may, in its
sole discretion, make such advances to the Borrower upon its request.
In addition to principal, the Borrower agrees to pay interest on the
principal amounts disbursed hereunder from time to time from the date of each
disbursement until paid at the Interest Rate on the last day of the interest
periods mutually agreed to from time to time by the Borrower and the Lender.
Interest shall accrue on the outstanding principal balance from the date hereof
up to and through the date on which all principal and interest hereunder is paid
in full, and shall be computed on the basis of the actual number of days elapsed
in a 360-day year. Such interest is to be paid to the Lender at the Lender's
principal office specified above.
The Lender shall at all times have a right of set-off against any deposit
balances of the Borrower in the possession of the Lender, and the Lender may
apply the same against payment of this Note or any other indebtedness of the
Borrower to the Lender. The payment of any indebtedness evidenced by this Note
prior to the Termination Date or demand shall not affect the enforceability of
this Note as to any future, different or other indebtedness incurred hereunder
by the Borrower. In the event the indebtedness evidenced by this Note is
collected by legal action or through an attorney-at-law, the Lender shall be
entitled to recover from the Borrower all costs of collection, including,
without limitation, reasonable attorneys' fees if collected by or through an
attorney-at-law.
The Borrower acknowledges that the actual crediting of the amount of any
disbursement under this Note to an account of the Borrower or recording such
amount in the books of the Lender shall, in the absence of manifest error,
constitute presumptive evidence of such
disbursement and that such advance was made and borrowed under this Note. Such
account records shall constitute, in the absence of manifest error, presumptive
evidence of principal amounts outstanding and the payments made under the Notes
at any time and from time to time, provided that the failure of the Lender to
record in its books or in such account the type or amount of any advance shall
not affect the obligation of the undersigned to repay such amount together with
interest thereon in accordance with this Note.
Prepayment of this Note in part or in whole is permitted.
Failure or forbearance of the Lender to exercise any right hereunder, or
otherwise granted by this Note or by law, shall not affect or release the
liability of the Borrower hereunder, and shall not constitute a waiver of such
right unless so stated by the Lender in writing. THIS NOTE SHALL BE DEEMED TO BE
MADE UNDER, AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY, THE LAWS
OF THE STATE OF GEORGIA. Time is of the essence of this Note.
PRESENTMENT FOR PAYMENT, NOTICE OF DISHONOR AND PROTEST ARE HEREBY WAIVED.
Executed under hand of the Borrower as of the day and year first above written.
HUGHES SUPPLY, INC.
By: _____________________________
J. Stephen Zepf
Treasurer
UNCOMMITTED SWING LINE DEMAND PROMISSORY NOTE
$10,000,000.00 March 1, 1999
Atlanta, Georgia
FOR VALUE RECEIVED, HUGHES SUPPLY, INC., a Florida corporation (the
"Borrower" or the "undersigned"), promises to pay to the order of SUNTRUST BANK,
CENTRAL FLORIDA, NATIONAL ASSOCIATION, a national banking association, (the
"Lender"), at the principal office of the Lender, at 200 South Orange Avenue,
Orlando, Florida 32801, or at such other place as the Lender may designate by
notice in writing to the Borrower, in immediately available funds in lawful
money of the United States of America, the lesser of (x) the principal sum of
TEN MILLION AND NO/100 DOLLARS ($10,000,000.00), together with interest on the
unpaid principal balance of this Uncommitted Swing Line Demand Promissory Note
(this "Note"), or (y) so much thereof as shall have been from time to time
disbursed hereunder in the sole discretion of the Lender, and not theretofore
repaid, as shown on the books and records of the Lender, at the rate per annum
mutually agreed upon from time to time by Borrower and Lender (the "Interest
Rate"), on the sooner of (i) DEMAND or (ii) January 25, 2000, or such later date
to which the Bank may extend this Note in writing and in its sole discretion,
(the "Termination Date").
Upon the terms of this Note and in compliance with the terms and conditions
hereof, the Borrower, from time to time, may request advances hereunder, repay
and reborrow up to the maximum aggregate principal amount outstanding at any one
time as indicated above, subject to the sole discretion of the Lender. The
Borrower acknowledges and agrees that the Lender shall have no obligation to
make any advances to the Borrower under this Note, but the Lender may, in its
sole discretion, make such advances to the Borrower upon its request.
In addition to principal, the Borrower agrees to pay interest on the
principal amounts disbursed hereunder from time to time from the date of each
disbursement until paid at the Interest Rate on the last day of the interest
periods mutually agreed to from time to time by the Borrower and the Lender.
Interest shall accrue on the outstanding principal balance from the date hereof
up to and through the date on which all principal and interest hereunder is paid
in full, and shall be computed on the basis of the actual number of days elapsed
in a 360-day year. Such interest is to be paid to the Lender at the Lender's
principal office specified above.
The Lender shall at all times have a right of set-off against any deposit
balances of the Borrower in the possession of the Lender, and the Lender may
apply the same against payment of this Note or any other indebtedness of the
Borrower to the Lender. The payment of any indebtedness evidenced by this Note
prior to the Termination Date or demand shall not affect the enforceability of
this Note as to any future, different or other indebtedness incurred hereunder
by the Borrower. In the event the indebtedness evidenced by this Note is
collected by legal action or through an attorney-at-law, the Lender shall be
entitled to recover from the Borrower all costs of
collection, including, without limitation, reasonable attorneys' fees if
collected by or through an attorney-at-law.
The Borrower acknowledges that the actual crediting of the amount of any
disbursement under this Note to an account of the Borrower or recording such
amount in the books of the Lender shall, in the absence of manifest error,
constitute presumptive evidence of such disbursement and that such advance was
made and borrowed under this Note. Such account records shall constitute, in the
absence of manifest error, presumptive evidence of principal amounts outstanding
and the payments made under the Notes at any time and from time to time,
provided that the failure of the Lender to record in its books or in such
account the type or amount of any advance shall not affect the obligation of the
undersigned to repay such amount together with interest thereon in accordance
with this Note.
Prepayment of this Note in part or in whole is permitted.
Failure or forbearance of the Lender to exercise any right hereunder, or
otherwise granted by this Note or by law, shall not affect or release the
liability of the Borrower hereunder, and shall not constitute a waiver of such
right unless so stated by the Lender in writing. THIS NOTE SHALL BE DEEMED TO BE
MADE UNDER, AND SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY, THE LAWS
OF THE STATE OF GEORGIA. Time is of the essence of this Note.
PRESENTMENT FOR PAYMENT, NOTICE OF DISHONOR AND PROTEST ARE HEREBY WAIVED.
Executed under hand of the Borrower as of the day and year first above written.
HUGHES SUPPLY, INC.
By: _____________________________
J. Stephen Zepf
Treasurer
SUBSIDIARY GUARANTY AGREEMENT
(Uncommitted Swing Line Note and Uncommitted Guidance Line Note)
THIS SUBSIDIARY GUARANTY AGREEMENT (this "Guaranty"), dated as of
March 1, 1999 made by each of the subsidiaries of Hughes Supply, Inc., a Florida
corporation ("Hughes"), listed on the signature pages hereof, together with all
other subsidiaries of Hughes that hereafter become parties hereto (individually,
a "Guarantor" and collectively, the "Guarantors"), in favor of SUNTRUST BANK,
CENTRAL FLORIDA, NATIONAL ASSOCIATION (the "Lender");
W I T N E S S E T H:
WHEREAS, Hughes executed and delivered that certain Uncommitted Swing
Line Note dated as of the date hereof, in favor of Lender, in the principal
amount of $10,000,000.00 (as hereafter amended, restated, renewed, extended,
supplemented or otherwise modified from time to time, the "Swing Line Note"),
and that certain Uncommitted Guidance Line Note dated as the date hereof, in
favor of Lender, in the principal amount of $15,000,000.00 (as hereafter
amended, restated, renewed, extended supplemented or otherwise modified from
time to time, the "Guidance Line Note", and together with the Swing Line Note,
the "Notes");
WHEREAS, Hughes owns, directly or indirectly, all or a majority of the
outstanding capital stock of each of the Guarantors;
WHEREAS, Hughes and the Guarantors share an identity of interest as
members of a consolidated group of companies engaged in substantially similar
businesses with Hughes providing certain centralized financial, accounting and
management services to each of the Guarantors by virtue of intercompany advances
and loans such that financial accommodations to Hughes under the Notes shall
inure to the direct and material benefit of the Guarantors; and
WHEREAS, the making of loans evidenced by the Notes will facilitate
expansion and enhance the overall financial strength and stability of Hughes's
entire corporate group, including the Guarantors; and
WHEREAS, it is a condition precedent to Lender making any loan under
the Notes, in its sole discretion, that the Guarantors enter into this Guaranty
to satisfy such condition precedent;
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lender to make loans to Hughes under the Notes, the Guarantors hereby
jointly and severally agree as follows:
SECTION 1. Guaranty. The Guarantors hereby jointly and severally,
irrevocably and unconditionally, guarantee the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all indebtedness
and all other obligations owing by Hughes to the Lender under the Notes,
including all renewals, extensions, modifications and refinancings thereof, now
or hereafter owing, whether for principal, interest, fees, expenses or
otherwise, and any and all reasonable out-of-pocket expenses (including
reasonable attorneys' fees actually incurred and expenses) incurred by the
Lender in enforcing any rights under this Guaranty (collectively, the
"Guaranteed Obligations"), including without limitation, all interest which, but
for the filing of a petition in bankruptcy with respect to Hughes, would accrue
on any principal portion of the Guaranteed Obligations. Any and all payments by
the Guarantors hereunder shall be made free and clear of and without deduction
for any set-off, counterclaim, or withholding so that, in each case, the Lender
will receive, after giving effect to any present or future taxes, levies,
imposts, duties, fees, assessments, deductions, withholdings or other charges of
whatever nature, including without limitation, income, receipts, excise,
property, sales, transfer, license, payroll, withholding, social security and
franchise taxes now or hereafter imposed or levied by the United States of
America, or any state, local or foreign government or by any department, agency
or other political subdivision or taxing authority thereof or therein and all
interest, penalties, additions to tax and similar liabilities with respect
thereto (collectively, the "Taxes"), (but excluding Taxes imposed on overall net
income of the Lender), the full amount that it would otherwise be entitled to
receive with respect to the Guaranteed Obligations (but without duplication of
amounts for Taxes already included in the Guaranteed Obligations). The
Guarantors acknowledge and agree that this is a guarantee of payment when due,
and not of collection, and that this Guaranty may be enforced up to the full
amount of the Guaranteed Obligations without proceeding against Hughes, against
any security for the Guaranteed Obligations, against any other Guarantor or
under any other guaranty covering any portion of the Guaranteed Obligations.
SECTION 2. Guaranty Absolute. The Guarantors guarantee that the
Guaranteed Obligations will be paid strictly in accordance with the terms of
this Guaranty and the Notes, 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 Lender with respect thereto. The liability of each Guarantor under
this Guaranty shall be absolute and unconditional in accordance with its terms
and shall remain in full force and effect without regard to, and shall not be
released, suspended, discharged, terminated or otherwise affected by, any
circumstance or occurrence whatsoever, including, without limitation, the
following (whether or not such Guarantor consents thereto or has notice
thereof):
(a) any change in the time, place or manner of payment of, or in any
other term of, all or any of the Guaranteed Obligations, any waiver,
indulgence, renewal, extension, amendment or modification of or addition,
consent or supplement to or deletion from or any other action or inaction
under or in respect of the Notes, or any other documents,
instruments or agreements relating to the Guaranteed Obligations or any
other instrument or agreement referred to therein or any assignment or
transfer of any thereof;
(b) any lack of validity or enforceability of the Notes or any other
document, instrument or agreement referred to therein or any assignment or
transfer of any thereof;
(c) any furnishing to the Lender of any security for the Guaranteed
Obligations, or any sale, exchange, release or surrender of, or realization
on, any security for the Guaranteed Obligations;
(d) any settlement or compromise of any of the Guaranteed Obligations,
any security therefor, or any liability of any other party with respect to
the Guaranteed Obligations, or any subordination of the payment of the
Guaranteed Obligations to the payment of any other liability of Hughes;
(e) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to
any Guarantor or Hughes, or any action taken with respect to this Guaranty
by any trustee or receiver, or by any court, in any such proceeding;
(f) any nonperfection of any security interest or lien on any
collateral, or any amendment or waiver of or consent to departure from any
guaranty or security, for all or any of the Guaranteed Obligations;
(g) any application of sums paid by Hughes or any other person or
entity with respect to the liabilities of Hughes to the Lender, regardless
of what liabilities of Hughes remain unpaid;.
(h) any act or failure to act by the Lender which may adversely affect
a Guarantor's subrogation rights, if any, against Hughes to recover
payments made under this Guaranty; and
(i) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, any Guarantor.
If claim is ever made upon the Lender for repayment or recovery of any amount or
amounts received in payment or on account of any of the Guaranteed Obligations,
and the Lender repays all or part of said amount by reason of (a) any judgment,
decree or order of any court or administrative body having jurisdiction over the
Lender or any of its property, or (b) any settlement or compromise of any such
claim effected by the Lender with any such claimant (including Hughes or a
trustee in bankruptcy for Hughes), then and in such event the Guarantors agree
that any such judgment, decree, order, settlement or compromise shall be binding
on it,
7
notwithstanding any revocation hereof or the cancellation of the Notes, or any
other instrument evidencing any liability of Hughes, and the Guarantors shall be
and remain liable to the Lender for the amounts so repaid or recovered to the
same extent as if such amount had never originally been paid to the Lender.
SECTION 3. Waiver. The Guarantors hereby waive notice of acceptance of
this Guaranty, notice of any liability to which it may apply, and further waive
presentment, demand of payment, protest, notice of dishonor or nonpayment of any
such liabilities, suit or taking of other action by the Lender against, and any
other notice to, Hughes or any other party liable with respect to the Guaranteed
Obligations (including the Guarantors or any other Person executing a guaranty
of the obligations of Hughes).
SECTION 4. Waiver of Subrogation. Upon the making by any Guarantor of
any payment hereunder for the account of Hughes, such Guarantor shall be
subrogated to the rights of the payee against Hughes with respect to such
payment; provided that such Guarantor shall not enforce any right or receive any
payment by way of subrogation until all of the Guaranteed Obligations have been
paid in full. If, prior to the payment in full of the Guaranteed Obligations,
any amount shall be paid to any Guarantor on account of such subrogation,
reimbursement, contribution or setoff rights, such amount shall be held in trust
for the benefit of the Lender and any other holders of the Guaranteed
Obligations and shall forthwith be paid to the Lender to be credited and applied
upon the Guaranteed Obligations, whether matured or unmatured, in accordance
with the terms of the Notes or to be held by the Lender as collateral security
for any Guaranteed Obligations thereafter existing.
SECTION 5. Contribution. For the purpose of establishing rights and
obligations of contribution among Hughes and the Guarantors for the benefit of
themselves and for the benefit of the Lender, the Guarantors hereby agree and
Hughes acknowledges the following contribution provisions:
(a) Indemnity and Subrogation. In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject subsection (c) below), Hughes agrees that (i) in the event a payment
shall be made by any Guarantor under this Guaranty in respect of the obligations
of Hughes under the terms of the Notes, Hughes shall indemnify such Guarantor
for the full amount of such payment and (ii) in the event any assets of any
Guarantor shall be sold pursuant to any stock pledge agreement or similar
instrument or agreement to satisfy a claim of the Lender, Hughes shall indemnify
such Guarantor in an amount equal to the greater of the book value or the fair
market value of the assets so sold. Each Guarantor has subordinated its rights
to subrogation, pursuant to Section 4 of this Guaranty.
(b) Contribution and Subrogation. Each Guarantor agrees (subject to
subsection (c) below) that in the event a payment shall be made by any Guarantor
under this Guaranty or assets of any Guarantor shall be sold pursuant to any
stock pledge agreement or similar instrument or agreement to satisfy a claim of
the Lender, and such Guarantor (the
8
"Claiming Guarantor") shall not have been indemnified by Hughes as provided in
subsection (a) above, each other Guarantor (a "Contributing Guarantor") shall
indemnify the Claiming Guarantor in an amount equal to the amount of such
payment or the greater of the book value or the fair market value of such
assets, as the case may be, multiplied by a fraction, the numerator of which
shall be as of the date of determination, the total shareholder's equity of such
date as determined in accordance with GAAP (the "Consolidated Net Worth") of the
Contributing Guarantor on the date hereof, and the denominator of which shall be
the sum of the Consolidated Net Worth of all the Guarantors on the date hereof.
Any Contributing Guarantor making any payment to a Claiming Guarantor pursuant
to this subsection (b) shall be subrogated to the rights of such Claiming
Guarantor under subsection (a) to the extent of such payment.
(c) Subordination. Notwithstanding any provision of this Guaranty to
the contrary, (i) all rights of the Guarantors under subsection (a) or (b) and
all other rights of indemnity or contribution under applicable law or otherwise
shall be fully subordinated to the indefeasible payment in full of the
Guaranteed Obligations, and (ii) no such rights shall be exercised until all of
the Guaranteed Obligations shall have been irrevocably paid in full. If any
amount shall be paid to any Guarantor on account of such indemnity or
contribution rights at any time when all of the Guaranteed Obligations shall not
have been paid in full, such amount shall be held in trust for the benefit of
the Lender and shall forthwith be paid to the Lender to be credited and applied
upon the Guaranteed Obligations, whether matured or unmatured, in accordance
with the terms of the Notes. No failure on the part of Hughes or any Guarantor
to make the payments required by subsection (a) or (b) (or any other payments
required under applicable law or otherwise) shall in any respect limit the
obligations and liabilities of any Guarantor with respect to this Guaranty, and
each Guarantor shall remain liable for the full amount of the obligations of
such Guarantor under this Guaranty.
(d) Allocation. If at any time there exists more than one Claiming
Guarantor with respect to this Guaranty, then payment from other Guarantors
pursuant to this Section 5 shall be allocated among such Claiming Guarantors in
proportion to the total amount of money paid for or on account of the Guaranteed
Obligations by each such Claiming Guarantor pursuant to the Guaranty.
(e) Preservation of Rights. This Section 5 shall not limit or affect
any right which any Guarantor may have against any other Person that is not a
party hereto.
(f) Subsidiary Payment. The amount of contribution payable under this
Section 5 by any Guarantor with respect to the Guaranty shall be reduced by the
amount of any contribution paid hereunder by a Subsidiary (as hereinafter
defined) of such Guarantor with respect to the Guaranty. The term "Subsidiary"
shall mean, with respect to any Person, any corporation or other entity
(including, without limitation, partnerships, joint ventures, and associations)
regardless of its jurisdiction of organization or formation, at least a majority
of the total combined voting power of all classes of voting stock or other
ownership interests of which
9
shall, at the time as of which any determination is being made, be owned by such
Person, either directly or indirectly through one or more other Subsidiaries.
(g) Asset Sale. If all of the stock of any Guarantor shall be sold or
otherwise disposed of (including by merger or consolidation) in an asset sale
not prohibited by the Notes or otherwise consented to by the Lender under the
Notes, the agreements of such Guarantor hereunder shall automatically be
discharged and released without any further action by such Guarantor and shall
be assumed in full by the corporation which prior to such asset sale or consent
owned the stock of such Guarantor, effective as of the time of such asset sale
or consent. Hughes shall cause any such corporation which is not a Guarantor to
become a party to this Guaranty unless otherwise agreed in writing by the
Lender.
(h) Equitable Allocation. If as a result of any reorganization,
recapitalization or other corporate change in Hughes or any of its Subsidiaries,
or as a result of any amendment, waiver or modification of the terms and
conditions governing the Guaranty or any of the Guaranteed Obligations, or for
any other reason, the contributions under this Section 5 become inequitable, the
parties hereto shall promptly modify and amend this Section 5 to provide for an
equitable allocation of contributions. All such modifications and amendments
shall be in writing and signed by all parties hereto.
(i) Asset of Party to Which Contribution and Indemnification Are
Owing. The parties hereto acknowledge that the right to contribution and
indemnification hereunder shall each constitute an asset in favor of the party
to which such contribution or indemnification is owing.
SECTION 6. Severability. Any provision of this Guaranty which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 7. Successors and Assigns; Amendments. This Guaranty shall be
binding upon each party hereto and its respective successors and assigns and
shall inure to the benefit of the parties hereto, the Lender and its respective
successors and assigns. None of any Guarantor's rights or any interest therein
under this Section 7 may be assigned or transferred without the written consent
of the Lender. In the event of any such transfer or assignment of rights by any
Guarantor, the rights and privileges herein conferred upon that Guarantor shall
automatically extend to and be vested in such transferee or assignee, all
subject to the terms and conditions hereof. This Section 7 shall not be amended
without the prior written consent of the Lender.
SECTION 8. Notices. All notices and other communications provided for
hereunder shall be given (i) in the case of the Lender, at the address specified
for the Lender in
10
the Notes, and (ii) in the case of the Guarantors, at the respective addresses
specified for such Guarantors in this Guaranty.
SECTION 9. No Waiver; Remedies. No failure on the part of the Lender
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. No notice to or demand on any Guarantor in any case shall entitle such
Guarantor to any other further notice or demand in any similar or other
circumstances or constitute a waiver of the rights of the Lender to any other or
further action in any circumstances without notice or demand. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.
SECTION 10. Right Of Set Off. In addition to and not in limitation of
all rights of offset that the Lender may have under applicable law, the Lender
shall, upon the occurrence of any Event of Default (as defined in the Notes) and
whether or not the Lender has made any demand or the Guaranteed Obligations are
matured, have the right to appropriate and apply to the payment of the
Guaranteed Obligations, all deposits of any Guarantor (general or special, time
or demand, provisional or final) then or thereafter held by and other
indebtedness or property then or thereafter owing by the Lender to any
Guarantor, whether or not related to this Guaranty or any transaction hereunder.
The Lender shall promptly notify the relevant Guarantor of any offset hereunder.
SECTION 11. Continuing Guaranty; Transfer Of Obligations. This
Guaranty is a continuing guaranty and shall (i) remain in full force and effect
until payment in full of the Guaranteed Obligations and all other amounts
payable under this Guaranty, (ii) be binding upon each Guarantor, its successors
and assigns, and (iii) inure to the benefit of and be enforceable by and for the
benefit of the Lender, its successors, transferees and assigns.
SECTION 12. Governing Law; Appointment Of Agent For Service Of
Process; Submission To Jurisdiction; Waiver of Jury Trial.
(a) THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF
THE STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTY OR
OTHERWISE RELATED HERETO MAY BE BROUGHT IN THE SUPERIOR COURT OF FULTON COUNTY
OF THE STATE OF GEORGIA OR OF THE UNITED STATES OF AMERICA FOR THE NORTHERN
DISTRICT OF GEORGIA, AND, BY EXECUTION AND DELIVERY OF THIS GUARANTY, EACH
GUARANTOR HEREBY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
JURISDICTION OF THE AFORESAID COURTS SOLELY FOR THE PURPOSE OF
11
ADJUDICATING ITS RIGHTS OR THE RIGHTS OF THE LENDER WITH RESPECT TO THIS
GUARANTY OR ANY DOCUMENT RELATED HERETO. EACH GUARANTOR HEREBY IRREVOCABLY
DESIGNATES CORPORATION SERVICE COMPANY AS THE DESIGNEE, APPOINTEE AND AGENT OF
SUCH GUARANTOR TO RECEIVE, FOR AND ON BEHALF OF SUCH GUARANTOR, SERVICE OF
PROCESS IN SUCH JURISDICTION IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS GUARANTY OR ANY DOCUMENT RELATED HERETO AND SUCH SERVICE SHALL BE DEEMED
COMPLETED THIRTY DAYS AFTER MAILING THEREOF TO SAID AGENT. IT IS UNDERSTOOD THAT
A COPY OF SUCH PROCESS SERVED ON SUCH AGENT WILL BE PROMPTLY FORWARDED BY SUCH
LOCAL AGENT AND BY THE SERVER OF PROCESS BY MAIL TO THE RESPECTIVE GUARANTOR AT
ITS ADDRESS SET FORTH HEREIN, BUT THE FAILURE OF SUCH GUARANTOR TO RECEIVE SUCH
COPY SHALL NOT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, AFFECT IN ANY WAY THE
SERVICE OF SUCH PROCESS. EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION,
INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS IN RESPECT
OF THIS GUARANTY OR ANY DOCUMENT RELATED THERETO. NOTHING HEREIN SHALL AFFECT
THE RIGHT OF THE LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY GUARANTOR IN ANY
OTHER JURISDICTION.
(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH GUARANTOR HEREBY
IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTY OR ANY OTHER
CREDIT DOCUMENT OR ANY MATTER ARISING IN CONNECTION HEREUNDER OR THEREUNDER.
SECTION 13. Subordination Of Hughes's Obligations To the Guarantors.
As an independent covenant, each Guarantor hereby expressly covenants and agrees
for the benefit of the Lender that all obligations and liabilities of Hughes to
such Guarantor of whatsoever description including, without limitation, all
intercompany receivables of such Guarantor from Hughes ("Junior Claims") shall
be subordinate and junior in right of payment to all obligations of Hughes to
the Lender under the terms of the Notes ("Senior Claims").
If an Event of Default shall occur, then, unless and until such Event
of Default shall have been cured, waived, or shall have ceased to exist, no
direct or indirect payment (in cash, property, securities by setoff or
otherwise) shall be made by Hughes to any Guarantor on account of or in any
manner in respect of any Junior Claim except such payments and distributions the
proceeds of which shall be applied to the payment of Senior Claims.
12
In the event of a Proceeding (as hereinafter defined), all Senior
Claims shall first be paid in full before any direct or indirect payment or
distribution (in cash, property, securities by setoff or otherwise) shall be
made to any Guarantor on account of or in any manner in respect of any Junior
Claim except such payments and distributions the proceeds of which shall be
applied to the payment of Senior Claims. For the purposes of the previous
sentence, "Proceeding" means Hughes or any Guarantor shall commence a voluntary
case concerning itself under The Bankruptcy Code of 1978, as amended and in
effect from time to time (11 U.S.C. ss. 101 et seq.; the "Bankruptcy Code"). or
any other applicable bankruptcy laws; or any involuntary case is commenced
against Hughes or any Guarantor; or a custodian (as defined in the Bankruptcy
Code or any other applicable bankruptcy laws) is appointed for, or takes charge
of, all or any substantial part of the property of Hughes or any Guarantor, or
Hughes or any Guarantor commences any other proceedings under any reorganization
arrangement, adjustment of debt, relief of debtor, dissolution, insolvency or
liquidation or similar law of any jurisdiction whether now or hereafter in
effect relating to Hughes or any Guarantor, or any such proceeding is commenced
against Hughes or any Guarantor, or Hughes or any Guarantor is adjudicated
insolvent or bankrupt; or any order of relief or other order approving any such
case or proceeding is entered; or Hughes or any Guarantor suffers any
appointment of any custodian or the like for it or any substantial part of its
property; or Hughes or any Guarantor makes a general assignment for the benefit
of creditors; or Hughes or any Guarantor shall fail to pay, or shall state that
it is unable to pay, or shall be unable to pay, its debts generally as they
become due; or Hughes or any Guarantor shall call a meeting of its creditors
with a view to arranging a composition or adjustment of its debts; or Hughes or
any Guarantor shall by any act or failure to act indicate its consent to,
approval of or acquiescence in any of the foregoing; or any corporate action
shall be taken by Hughes or any Guarantor for the purpose of effecting any of
the foregoing.
In the event any direct or indirect payment or distribution is made to
a Guarantor in contravention of this Section 13, such payment or distribution
shall be deemed received in trust for the benefit of the Lender and shall be
immediately paid over to the Lender for application against the Guaranteed
Obligations in accordance with the terms of the Notes.
Each Guarantor agrees to execute such additional documents as the
Lender may reasonably request to evidence the subordination provided for in this
Section 13.
SECTION 14. Judgment Currency. (a) The Guarantors' obligations
hereunder to make payments in a particular currency (the "Obligation Currency")
shall not be discharged or satisfied by any tender or recovery pursuant to any
judgment expressed in or converted into any currency other than the Obligation
Currency, except to the extent that such tender or recovery results in the
effective receipt by the Lender of the full amount of the Obligation Currency
expressed to be payable under this Guaranty or the Notes. If for the purpose of
obtaining or enforcing judgment against any Guarantor in any court or in any
jurisdiction, it becomes necessary to convert into or from any currency other
than the Obligation Currency (such other currency being hereinafter referred to
as the "Judgment Currency") an amount due in the Obligation Currency, the
conversion shall be made, at the currency equivalent determined, in
13
each case, as on the day immediately preceding the day on which the judgment is
given (such day being any day other than Saturday, Sunday and a day on which
commercial banks are required to be closed for business in Atlanta, Georgia, or
Orlando, Florida being hereafter referred to as the "Judgment Currency
Conversion Date").
(b) If there is a change in the rate of exchange prevailing between
the Judgment Currency Conversion Date and the date of actual payment of the
amount due, the Guarantors covenant and agree to pay, or cause to be paid, such
additional amounts, if any (but in any event not a lesser amount), as may be
necessary to ensure that the amount paid in the Judgment Currency, when
converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
award at the rate of exchange prevailing on the Judgment Currency Conversion
Date.
(c) For purposes of determining the currency equivalent for this
Section, such amounts shall include any premium and costs payable in connection
with the purchase of the Obligation Currency.
(d) If the Obligation Currency is the lawful money of the United
States of America. ("U.S. Dollars"), the currency equivalent shall be the Dollar
Equivalent. For purposes of this Guaranty, the term "Dollar Equivalent" shall
mean, with respect to any monetary amount in a currency other than U.S. Dollars,
at any time for the determination thereof, the amount of U.S. Dollars obtained
by converting such currency involved in such computation into U.S. Dollars at
the spot rate for the purchase of U.S. Dollars with the applicable currency as
quoted by the Lender at 11:00 a.m. (local time for the Lender) on the date of
determination thereof specified herein or, if the date of determination thereof
is not otherwise specified herein, on the date two applicable Business Days
prior to such determination. For purposes of this Guaranty, the term "Business
Day" shall mean any day other than Saturday, Sunday and a day on which
commercial banks are required to be closed for business in Atlanta, Georgia, or
Orlando, Florida.
SECTION 15. Automatic Acceleration in Certain Events. Upon the
occurrence of an Event of Default as defined in the Notes, all Guaranteed
Obligations shall automatically become immediately due and payable by the
Guarantors, without notice or other action on the part of the Lender, and
regardless of whether payment of the Guaranteed Obligations by Hughes has then
been accelerated. In addition, if any event of the types described in the Notes
should occur with respect to any Guarantor, then the Guaranteed Obligations
shall automatically become immediately due and payable by such Guarantor,
without notice or other action on the part of the Lender, and regardless of
whether payment of the Guaranteed Obligations by Hughes has then been
accelerated.
SECTION 16. Savings Clause. (a) It is the intent of each Guarantor and
the Lender that each Guarantor's maximum obligations hereunder shall be, but not
in excess of:
14
(i) in a case or proceeding commenced by or against such
Guarantor under the Bankruptcy Code on or within one year from the date on
which any of the Guaranteed Obligations are incurred, the maximum amount
which would not otherwise cause the Guaranteed Obligations (or any other
obligations of such Guarantor to the Lender) to be avoidable or
unenforceable against such Guarantor under (A) Section 548 of the
Bankruptcy Code or (B) any state fraudulent transfer or fraudulent
conveyance act or statute applied in such case or proceeding by virtue of
Section 544 of the Bankruptcy Code; or
(ii) in a case or proceeding commenced by or against such
Guarantor under the Bankruptcy Code subsequent to one year from the date on
which any of the Guaranteed Obligations are incurred, the maximum amount
which would not otherwise cause the Guaranteed Obligations (or any other
obligations of the Guarantor to the Lender) to be avoidable or
unenforceable against such Guarantor under any state fraudulent transfer or
fraudulent conveyance act or statute applied in any such case or proceeding
by virtue of Section 544 of the Bankruptcy Code; or
(iii) in a case or proceeding commenced by or against such
Guarantor under any law, statute or regulation other than the Bankruptcy
Code (including, without limitation, any other bankruptcy, reorganization,
arrangement, moratorium, readjustment of debt, dissolution, liquidation or
similar debtor relief laws), the maximum amount which would not otherwise
cause the Guaranteed Obligations (or any other obligations of such
Guarantor to the Lender) to be avoidable or unenforceable against such
Guarantor under such law, statute or regulation including, without
limitation, any state fraudulent transfer or fraudulent conveyance act or
statute applied in any such case or proceeding.
(The substantive laws under which the possible avoidance or unenforceability of
the Guaranteed Obligations (or any other obligations of such Guarantor to the
Lender) shall be determined in any such case or proceeding shall hereinafter be
referred to as the "Avoidance Provisions").
(b) To the end set forth in Section 16(a), but only to the extent that
the Guaranteed Obligations would otherwise be subject to avoidance under
the Avoidance Provisions if such Guarantor is not deemed to have received
valuable consideration, fair value or reasonably equivalent value for the
Guaranteed Obligations, or if the Guaranteed Obligations would render the
Guarantor insolvent, or leave the Guarantor with an unreasonably small
capital to conduct its business, or cause the Guarantor to have incurred
debts (or to have intended to have incurred debts) beyond its ability to
pay such debts as they mature, in each case as of the time any of the
Guaranteed Obligations are deemed to have been incurred under the Avoidance
Provisions and after giving effect to contribution as among Guarantors, the
maximum Guaranteed Obligations for which such Guarantor shall be liable
hereunder shall be reduced to that amount which, after giving effect
thereto, would not cause the Guaranteed Obligations (or any other
obligations of such Guarantor to the Lender), as so reduced, to be subject
to avoidance under the Avoidance Provisions. This Section 16(b) is intended
solely to preserve the rights of the Lender hereunder to the maximum extent
that would not cause the Guaranteed Obligations of any Guarantor to be
subject to avoidance under the
15
Avoidance Provisions, and neither such Guarantor nor any other Person shall
have any right or claim under this Section 16 as against the Lender that
would not otherwise be available to such Person under the Avoidance
Provisions.
(c) None of the provisions of this Section 16 are intended in any
manner to alter the obligations of any holder of subordinated debt or the
rights of the holders of "senior indebtedness" as provided by the terms of
the subordinated debt. Accordingly, it is the intent of each of the
Guarantors that, in the event that any payment or distribution is made with
respect to the subordinated debt prior to the payment in full of the
Guaranteed Obligations by virtue of the provisions of this Section 16, in
any case or proceeding of the kinds described in clauses (i)-(iii) of
Section 16(a), the holders of the subordinated debt shall be obligated to
pay or deliver such payment or distribution to or for the benefit of the
Lender. Furthermore, in respect of the Avoidance Provisions, it is the
intent of each Guarantor that the subrogation rights of the holders of
subordinated debt with respect to the obligations of the Guarantor under
this Guaranty, be subject in all respects to the provisions of Section
16(b).
SECTION 17. Information. Each of the Guarantors assumes all
responsibility for being and keeping itself informed of Hughes's financial
condition and assets, and of all other circumstances bearing upon the risk of
nonpayment of the Guaranteed Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder, and agrees that none of
the Lender will have any duty to advise any of the Guarantors of information
known to it or any of them regarding such circumstances or risks.
SECTION 18. Survival. All agreements, representations and warranties
made herein shall survive the execution and delivery of this Guaranty and of the
Notes.
SECTION 19. Counterparts. This Guaranty and any amendments, waivers,
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument.
SECTION 20. Currency of Payment. All payments to be made by the
Guarantors hereunder shall be made in the relevant currency or currencies in
which the Guaranteed Obligations are denominated in immediately available funds.
If any Guarantor is unable for any reason to effect payment of any of the
Guaranteed Obligations in the currency in which such Guaranteed Obligations are
denominated, the Lender may, at their option, require such payment to be made in
the Dollar Equivalent of such currency. If in any case where any of the
Guarantors shall make any such payment in the Dollar Equivalent, the Guarantors
agree to hold the Lender harmless from any loss incurred by the Lender arising
from any change in the
16
value of Dollars in relation to such currency between the date such payment
became due and the date of payment thereof.
SECTION 21. Additional Guarantors. Upon execution and delivery by any
Subsidiary of Hughes of a supplement to that certain guaranty dated as of
January 26, 1999 (the Revolver Guaranty"), made by each of the material
subsidiaries of Hughes, listed on the signature pages thereto, in favor of
Lender, individually and as Administrative Agent, First Union National Bank,
individually and as Documentation Agent, Nationsbank, N.A., individually and as
Syndication Agent, Southtrust Bank, National Association, individually and as
Co-Agent, or to that certain guaranty dated as of January 26, 1999 (the "Line of
Credit Guaranty") made by each of the material subsidiaries of Hughes, listed on
the signature pages thereof, in favor of Lender, individually and as
Administrative Agent, First Union National Bank, individually and as
Documentation Agent, Nationsbank, N.A., individually and as Syndication Agent,
Southtrust Bank, National Association, individually and as Co-Agent, such
subsidiary shall also execute and deliver to Lender an instrument in the form of
Annex 1, such Subsidiary of Hughes shall become a Guarantor hereunder with the
same force and effect as if originally named a Guarantor herein (each an
"Additional Guarantor"). The execution and delivery of any such instrument shall
not require the consent of any Guarantor hereunder. The rights and obligations
of each Guarantor hereunder shall remain in full force and effect
notwithstanding the addition of any Additional Guarantor as a party to this
Guaranty.
17
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered by their respective duly authorized officers as of the
date first above written.
GUARANTORS:
Address: ALLIED METALS, INC.
20 North Orange Avenue APPCO PROCESS EQUIPMENT COMPANY
Suite 200 ATLANTIC PUMP & EQUIPMENT COMPANY OF
Orlando, FL 32801 MIAMI, INC.
Attn: J. Stephen Zepf ATLANTIC PUMP & EQUIPMENT COMPANY OF WEST
PALM BEACH, INC.
CAROLINA PUMP & SUPPLY CORP.
CHAD SUPPLY, INC.
COASTAL WHOLESALE, INC.
DOUGLAS LEONHARDT & ASSOCIATES, INC.
DOMINION PIPE FABRICATORS,
INCORPORATED
DOMINION PIPE & SUPPLY CO.
ELASCO AGENCY SALES, INC.
ELEC-TEL SUPPLY COMPANY
ELECTRIC LABORATORIES AND SALES
CORPORATION
FES MERGER CORP., INC.
FLORIDA PIPE & SUPPLY COMPANY
GAYLE SUPPLY COMPANY, INC.
GILLELAND CONCRETE PRODUCTS, INC.
GPEC, INC.
H VENTURE CORP.
HSI ACQUISITION CORPORATION
HUGHES WATER & SUPPLY COMPANY
HUGHES SUPPLY MANAGEMENT SERVICES, INC.
INTERNATIONAL SUPPLY COMPANY
J. I. SERVICES CORPORATION
J & J, INC.
JUNO INDUSTRIES, INC.
KAMEN MERGER CORP.
MEREX CORPORATION
METALS INCORPORATED
METALS, INC. - GULF COAST DIVISION
MILLS & LUPTON SUPPLY COMPANY
MOORE ELECTRIC SUPPLY, INC.
MOUNTAIN COUNTRY SUPPLY, INC.
OLANDER & BROPHY, INCORPORATED
ONE-STOP SUPPLY, INC.
PAINE SUPPLY OF JACKSON, INC.
PALM POOL PRODUCTS, INC.
PANHANDLE PIPE AND SUPPLY CO., INC.
PORT CITY ELECTRICAL SUPPLY, INC.
R & G PLUMBING SUPPLY, INC.
SAN ANTONIO PLUMBING DISTRIBUTORS, INC.
SHRADER HOLDING COMPANY, INC.
STAINLESS TUBULAR PRODUCTS, INC.
SUNBELT SUPPLY COMPANY
USCO INCORPORATED
UNION MERGER CORPORATION
U.S. FUSION SERVICES, INC.
VIRGINIA WATER & WASTE SUPPLY COMPANY, INC.
WCC MERGER CORPORATION
WHOLESALE ELECTRIC SUPPLY CORPORATION
By: ________________________________________
J. Stephen Zepf
Treasurer
Address: HHH, INC.
1403 Foulk Road, Suite 102 Z&L ACQUISITION CORP. OF DELAWARE, INC.
Wilmington, DE 19803 L&T OF DELAWARE, INC.
Z&L ACQUISITION CORP.
By:________________________________________
Gordon Stewart
President
Address: HSI CORP.
1403 Foulk Road, Suite 101
Wilmington, DE 19803
By:________________________________________
Gordon Stewart
President
Address: SOUTHWEST STAINLESS, L.P.
1403 Foulk Road, Suite 102
Wilmington, DE 19803 By: Z&L ACQUISITION CORP.,
its General Partner
By:_________________________________
Gordon Stewart
President
[SIGNATURE PAGE TO SUBSIDIARY GUARANTY AGREEMENT]
SECTION 5 AND 21 OF THE
FOREGOING GUARANTY
ACKNOWLEDGED AND
AGREED TO:
HUGHES SUPPLY, INC.
By:_____________________________
J. Stephen Zepf
Treasurer
ANNEX I
SUPPLEMENT
TO
SUBSIDIARY GUARANTY AGREEMENT
THIS SUPPLEMENT TO SUBSIDIARY GUARANTY AGREEMENT (this "Supplement to
Guaranty Agreement"), dated as of __________________, made by
______________________, a ________ corporation (the "Additional Guarantor"), in
favor of SUNTRUST BANK, CENTRAL FLORIDA, NATIONAL ASSOCIATION (the "Lender");
W I T N E S S E T H:
WHEREAS, Hughes executed and delivered that certain Uncommitted Swing
Line Note dated as of March 1, 1999, in favor of Lender, in the principal amount
of $10,000,000.00 (as hereafter amended, restated, renewed, extended,
supplemented or otherwise modified from time to time, the "Swing Line Note"),
and that certain Uncommitted Guidance Line Note dated as of March 1, 1999, in
favor of Lender, in the principal amount of $15,000,000.00 (as hereafter
amended, restated, renewed, extended, supplemented or otherwise modified from
time to time, the "Guidance Line Note", and together with the Swing Line Note,
the "Notes");
WHEREAS, certain Subsidiaries (the "Subsidiary Guarantors") of Hughes
have executed and delivered a Subsidiary Guaranty Agreement, dated as of March
1, 1999 (as amended, restated, supplemented or otherwise modified from time to
time, the "Subsidiary Guaranty"), pursuant to which the Subsidiary Guarantors
have agreed to guarantee all of the obligations of Hughes under the Notes;
WHEREAS, Hughes, the Subsidiary Guarantors and the Additional
Guarantor share an identity of interests as members of a consolidated group of
companies engaged in substantially similar businesses; Hughes provides certain
centralized financial, accounting and management services to the Additional
Guarantor; the making of the loans will facilitate expansion and enhance the
overall financial strength and stability of Hughes's corporate group, including
the Additional Guarantor; and by virtue of intercompany advances and loans, the
financial accommodations to Hughes under the Notes shall inure to the direct and
material benefit of Guarantors; and
WHEREAS, it is a condition subsequent to the Lender's making loans, in
its sole discretion, to Hughes evidenced by the Notes that the Additional
Guarantor execute and deliver to the Lender this Supplement to Guaranty
Agreement, and the Additional Guarantor desires to execute and deliver this
Supplement to Guaranty Agreement to satisfy such condition subsequent;
NOW, THEREFORE, in consideration of the premises and in order to
induce the Lender to make the loans to Hughes under the Notes, the Additional
Guarantor hereby agrees as follows:
SECTION 2. Defined Terms. Capitalized terms not otherwise defined
herein shall have the meanings specified for such terms in the Subsidiary
Guaranty.
SECTION 3. Additional Guarantor. The Additional Guarantor agrees that
it shall be and become a Guarantor for all purposes of the Subsidiary Guaranty
and shall be fully liable thereunder to the Lender to the same extent and with
the same effect as though the Additional Guarantor had been one of the
Guarantors originally executing and delivering the Subsidiary Guaranty. Without
limiting the foregoing, the Additional Guarantor hereby jointly and severally
(with respect to the guaranties made by the Subsidiary Guarantors under the
Subsidiary Guaranty), irrevocably and unconditionally, guarantees the punctual
payment when due, whether at stated maturity by acceleration or otherwise, of
all indebtedness and all other obligations, including all renewals, extensions,
modifications and refinancings thereof, now or hereafter existing, whether for
principal, interest, fees, expenses or otherwise, and any and all expenses
(including reasonable attorneys' fees actually incurred and reasonable
out-of-pocket expenses) incurred by the Lender in enforcing any rights under the
Subsidiary Guaranty (as supplemented hereby), subject, however, to the
limitations expressly provided in the Subsidiary Guaranty in Section 16 thereof.
All references in the Subsidiary Guaranty to "Guarantors" or any "Guarantor"
shall be deemed to include and to refer to the Additional Guarantor.
3. Enforceability. This Supplement has been duly authorized, executed and
delivered by Additional Guarantor and constitutes a legal, valid and binding
obligation of Additional Guarantor, enforceable against it in accordance with
its terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting creditors
rights generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).
4. Counterparts. This Supplement and any amendments, waivers, consents or
supplements may be executed in any number of counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
shall constitute but one and the same instrument.
5. Effective Upon Delivery. This Supplement shall become effective upon
execution by Additional Guarantor and delivery of this Supplement, as executed,
to the Lender.
6. Governing Law; Appointment of Agent for Service of Process; Submission
to Jurisdiction; Waiver of Jury Trial.
(a) THIS SUPPLEMENT TO GUARANTY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS SUPPLEMENT TO
GUARANTY AGREEMENT RELATED HERETO MAY BE BROUGHT IN THE SUPERIOR COURT OF FULTON
COUNTY OF THE STATE OF GEORGIA OR OF THE UNITED STATES OF AMERICA FOR THE
NORTHERN DISTRICT OF GEORGIA, AND, BY EXECUTION AND DELIVERY OF THIS SUPPLEMENT
TO GUARANTY AGREEMENT, THE ADDITIONAL GUARANTOR HEREBY CONSENTS, FOR ITSELF AND
IN RESPECT OF ITS PROPERTY, TO THE JURISDICTION OF THE AFORESAID COURTS SOLELY
FOR THE PURPOSE OF ADJUDICATING ITS RIGHTS OR THE RIGHTS OF THE LENDER WITH
RESPECT TO THIS SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED HERETO.
THE ADDITIONAL GUARANTOR HEREBY IRREVOCABLY DESIGNATES CORPORATION SERVICE
COMPANY AS THE DESIGNEE, APPOINTEE AND AGENT OF THE ADDITIONAL GUARANTOR TO
RECEIVE, FOR AND ON BEHALF OF THE ADDITIONAL GUARANTOR, SERVICE OF PROCESS IN
SUCH JURISDICTION IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED HERETO AND SUCH SERVICE
SHALL BE DEEMED COMPLETED THIRTY (30) DAYS AFTER MAILING THEREOF TO SAID AGENT.
IT IS UNDERSTOOD THAT A COPY OF SUCH PROCESS SERVED ON SUCH AGENT WILL BE
PROMPTLY FORWARDED BY SUCH LOCAL AGENT AND BY THE SERVER OF PROCESS BY MAIL TO
THE ADDITIONAL GUARANTOR AT ITS ADDRESS SET FORTH HEREIN, BUT THE FAILURE OF THE
ADDITIONAL GUARANTOR TO RECEIVE SUCH COPY SHALL NOT, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, AFFECT IN ANY WAY THE SERVICE OF SUCH PROCESS. THE ADDITIONAL
GUARANTOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS IN RESPECT OF THIS
SUPPLEMENT TO GUARANTY AGREEMENT OR ANY DOCUMENT RELATED THERETO. NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE LENDER TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST
THE ADDITIONAL GUARANTOR IN ANY OTHER JURISDICTION.
3
(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADDITIONAL
GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS SUPPLEMENT
TO GUARANTY AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR ANY MATTER ARISING IN
CONNECTION HEREUNDER OR THEREUNDER.
7. Severability. In case any provision in or obligation under this
Supplement 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
IN WITNESS WHEREOF, the Additional Guarantor has caused this
Supplement to Guaranty Agreement to be duly executed and delivered to the Lender
under seal by its duly authorized officers as of the date first above written.
Address for Notices: ADDITIONAL GUARANTOR:
_______________________________
By:____________________________
Title:______________________
AMENDMENT TO UNCOMMITTED GUIDANCE AND SWING LINE DEMAND
PROMISSORY NOTE
February 11, 2002
Mr. Robert Hillier
Hughes Supply, Inc.
20 N. Orange Ave., Suite 510
Orlando, FL 32801
Dear Robert:
This letter serves as official notice that as of June 30, 2001, the maturity
date on the $10,000,000 Swing Line provided by SunTrust Bank, Inc. (the Bank)
was extended to June 30, 2002. Concurrently, the $15,000,000 Guidance Line
provided by the Bank has also been extended to June 30, 2002, with these funds
now appropriated to a split-trac operating lease agreement.
According to the Swing Line and Guidance Line Notes, the Bank may extend the
Notes in writing and at its sole discretion.
If you should have any questions or need assistance please call me at (407)
237-4752.
Sincerely,
Sarah D. Hudson
Associate
SunTrust Bank, Inc.