EXHIBIT 4.11
SUBSIDIARY GUARANTEE
Computer City, Inc., a Delaware corporation ("Guarantor"), hereby
executes this Subsidiary Guarantee (this "Subsidiary Guarantee") on behalf of
its sole stockholder, CompUSA Inc., a Delaware corporation (the "Company"),
in connection with that certain Indenture (the "Indenture") dated as of June
17, 1993, among the Company, certain of its subsidiaries (collectively, with
the Guarantor, the "Guarantors") and U.S. Trust Company of Texas, N.A. (the
"Trustee"). Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the Indenture.
The Guarantor hereby unconditionally guarantees to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and
its successors and assigns, irrespective of the validity and enforceability
of the Indenture, the Securities and the obligations of the Company
thereunder, that: (a) the principal of and interest on the Securities will be
promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and
interest on the Securities, if any, if lawful, and all other obligations of
the Company to the Securityholders or the Trustee under the Indenture and the
Securities will be promptly paid in full or performed, all in accordance with
the terms thereof; and (b) in case of any extension of time of payment or
renewal of any Securities or any of such other obligations, that same will be
promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantor will be jointly
and severally obligated (together with the other Guarantors) to pay the same
immediately. The Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or the Indenture, the absence of any action
to enforce the same, any waiver or consent by any Securityholder with respect
to any provisions thereof, the recovery of any judgment against the Company,
any action to enforce the same or any other circumstance that might otherwise
constitute a legal or equitable discharge or defense of the Guarantor. The
Guarantor hereby waives diligence, presentment, demand of payment, filing of
claims with a court in the event of insolvency or bankruptcy of the Company,
any right to require a proceeding first against the Company, protest, notice
and all demands whatsoever and covenants that this Subsidiary Guarantee will
not be discharged except by complete performance of the obligations contained
in the Securities and the Indenture. If any Securityholder or the Trustee is
required by any court or otherwise to return to the Company or any Guarantor,
or any Custodian, Trustee, liquidator or other similar official acting in
relation to either the Company or the Guarantors, any amount paid by either
to the Trustee or such Securityholder, this Subsidiary Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
The Guarantor agrees that it shall not be entitled to any right of
subrogation in relation to the Securityholders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
The Guarantor further agrees that, as between the Guarantors, on the one
hand, and the Securityholders and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed
hereby may be accelerated as provided in Article 6 of the Indenture for the
purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction
or other prohibition preventing such acceleration in respect of the
obligations guaranteed thereunder, and (y) in the event of any declaration of
acceleration of such obligations as provided in Article 6 of the Indenture,
such obligations (whether or not due and payable) shall forthwith become due
and payable by the Guarantors for the purpose of this Subsidiary Guarantee.
The Guarantor shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Securityholders under this Subsidiary Guarantee.
The Guarantor agrees to pay any and all costs and expenses (including
reasonable attorneys' fees) incurred by the Trustee or any Holder in
enforcing any rights under this Subsidiary Guarantee; PROVIDED, HOWEVER, that
the maximum liability of the Guarantor pursuant to this Subsidiary Guarantee
shall be limited by the following paragraph.
The Guarantor hereby confirms that it is the intention of all parties
that the guarantee by the Guarantor pursuant to this Subsidiary Guarantee not
constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer
Act or any similar federal or state law. To effectuate the foregoing
intention, the Guarantor hereby irrevocably agrees that the obligations of
such Guarantor under this Subsidiary Guarantee shall be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of the Guarantor and after giving effect to any collection from
or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Subsidiary Guarantee, result in
the obligations of the Guarantor under this Subsidiary Guarantee not
constituting such fraudulent transfer or conveyance.
No stockholder, officer, director or incorporator, as such, past,
present or future, of the Guarantor shall have any personal liability under
this Subsidiary Guarantee by reason of his or its status as such stockholder,
officer, director or incorporator.
This Subsidiary Guarantee shall be binding upon the Guarantor and its
successors and assigns and shall inure to the benefit of the successors and
assigns of the Trustee and the Securityholders and, in the event of any
transfer or assignment of rights by any Securityholder or the Trustee, the
rights and privileges herein conferred upon that party shall automatically
extend to and be vested in such transferee or assignee, all subject to the
terms and conditions hereof.
The obligations of the Guarantor to the Securityholders and to the
Trustee pursuant to this Subsidiary Guarantee and the Indenture are expressly
subordinated to the extent set forth in Article 11 of the Indenture and
reference is hereby made to such Indenture for the precise terms of such
subordination.
Concurrently with a sale or other disposition of assets or all of the
capital stock of the Guarantor in compliance with the terms and conditions
set forth in the Indenture, including
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Sections 4.10 and 11.04 thereof, such assets shall automatically be released
from any Liens in favor of the Trustee and, if the assets sold or otherwise
disposed of include all or substantially all of the assets of the Guarantor
or all of the capital stock of the Guarantor, then the Guarantor (in the
event of a sale or other disposition of all of the capital stock of such
Guarantor) or the purchaser of the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor)
shall automatically be released from and relieved of any obligations under
the Subsidiary Guarantee without any action required on the part of the
Trustee or any Securityholder.
EXECUTED as of the 31st day of August, 1998.
Computer City, Inc.
By: /s/ Mark R. Walker
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Name: Mark R. Walker
Title: Secretary
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