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EXHIBIT (b)(3)
GUARANTY
GUARANTY, dated as of March 19, 1998, by HADCO ACQUISITION CORP. II, a
Delaware corporation (the "Guarantor") in favor of (i) BANKBOSTON, N.A. (f/k/a
The First National Bank of Boston), as agent (hereinafter, in such capacity, the
"Agent") for itself and the other banking institutions (hereinafter,
collectively, the "Banks") which are or may become parties to an Amended and
Restated Revolving Credit Agreement dated as of December 8, 1997 (as amended and
in effect from time to time, the "Credit Agreement"), among HADCO CORPORATION, a
Massachusetts corporation (the "Company"), the Banks and the Agent and (ii)
each of the Banks.
WHEREAS, the Company and the Guarantor are members of a group of related
corporations, the success of either one of which is dependent in part on the
success of the other members of such group;
WHEREAS, the Guarantor expects to receive substantial direct and indirect
benefits from the extensions of credit to the Company by the Banks pursuant to
the Credit Agreement (which benefits are hereby acknowledged);
WHEREAS, it is a condition precedent to the Banks' making any loans or
otherwise extending credit to the Company under the Credit Agreement that the
Guarantor execute and deliver to the Agent, for the benefit of the Banks and the
Agent, a guaranty substantially in the form hereof; and
WHEREAS, the Guarantor wishes to guaranty the Company's obligations to the
Banks and the Agent under or in respect of the Credit Agreement as provided
herein;
NOW, THEREFORE, the Guarantor hereby agrees with the Banks and the Agent as
follows:
1. DEFINITIONS. The term "Obligations" and all capitalized terms used herein
without definition shall have the respective meanings provided therefor in the
Credit Agreement; PROVIDED, HOWEVER, that until the earliest to occur of (a) the
consummation of the Continental Merger and (b) the date upon which the
Securities no longer constitute Margin Stock, the term "Obligations" shall mean
the "Obligations", as defined in the Credit Agreement, in an aggregate amount
not to exceed the Maximum Guaranteed Loan Value. Immediately upon the earlier to
occur of the consummation of the Merger and the date on which the Securities no
longer constitute Margin Stock, the term "Obligations" shall automatically be
deemed to refer to the "Obligations", as defined in the Credit Agreement,
without further action by any party.
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2. GUARANTY OF PAYMENT AND PERFORMANCE. The Guarantor hereby guarantees to
the Banks and the Agent the full and punctual payment when due (whether at
stated maturity, by required pre-payment, by acceleration or otherwise), as well
as the performance, of all of the Obligations including all such which would
become due but for the operation of the automatic stay pursuant to ss.362(a) of
the Federal Bankruptcy Code and the operation of secs.502(b) and 506(b) of the
Federal Bankruptcy Code. This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment and performance of all of
the Obligations and not of their collectibility only and is in no way
conditioned upon any requirement that the Agent or any Bank first attempt to
collect any of the Obligations from the Company or resort to any collateral
security or other means of obtaining payment. Should the Company default in the
payment or performance of any of the Obligations, the obligations of the
Guarantor hereunder with respect to such Obligations in default shall, upon
demand by the Agent, become immediately due and payable to the Agent, for the
benefit of the Banks and the Agent, without demand or notice of any nature, all
of which are expressly waived by the Guarantor. Payments by the Guarantor
hereunder may be required by the Agent on any number of occasions. All payments
by the Guarantor hereunder shall be made to the Agent, in the manner and at the
place of payment specified therefor in the Credit Agreement, for the account of
the Banks and the Agent.
3. GUARANTOR'S AGREEMENT TO PAY ENFORCEMENT COSTS, ETC. The Guarantor
further agrees, as the principal obligor and not as a guarantor only, to pay to
the Agent, on demand, all costs and expenses (including court costs and legal
expenses) incurred or expended by the Agent or any Bank in connection with the
Obligations, this Guaranty and the enforcement thereof, together with interest
on amounts recoverable under this ss.3 from the time when such amounts become
due until payment, whether before or after judgment, at the rate of interest for
overdue principal set forth in the Credit Agreement, PROVIDED that if such
interest exceeds the maximum amount permitted to be paid under applicable law,
then such interest shall be reduced to such maximum permitted amount.
4. WAIVERS BY GUARANTOR; BANK'S FREEDOM TO ACT. The Guarantor agrees that
the Obligations will be paid and performed strictly in accordance with their
respective terms, 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 any Bank with respect thereto. The Guarantor waives promptness,
diligences, presentment, demand, protest, notice of acceptance, notice of any
Obligations incurred and all other notices of any kind, all defenses which may
be available by virtue of any valuation, stay, moratorium law or other similar
law now or hereafter in effect, any right to require the marshalling of assets
of the Company or any other entity or other person primarily or secondarily
liable with respect to any of the Obligations, and all suretyship defenses
generally. Without limiting the generality of the foregoing, the Guarantor
agrees to the provisions of any instrument evidencing, securing or otherwise
executed in connection with any Obligation and agrees that the obligations of
the Guarantor
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hereunder shall not be released or discharged, in whole or in part, or otherwise
affected by (i) the failure of the Agent or any Bank to assert any claim or
demand or to enforce any right or remedy against the Company or any other entity
or other person primarily or secondarily liable with respect to any of the
Obligations; (ii) any extensions, compromise, refinancing, consolidation or
renewals of any Obligation; (iii) any change in the time, place or manner of
payment of any of the Obligations or any rescissions, waivers, compromise,
refinancing, consolidation or other amendments or modifications of any of the
terms or provisions of the Credit Agreement, the Notes, the other Loan Documents
or any other agreement evidencing, securing or otherwise executed in connection
with any of the Obligations, (iv) the addition, substitution or release of any
entity or other person primarily or secondarily liable for any Obligation; (v)
the adequacy of any rights which the Agent or any Bank may have against any
collateral security or other means of obtaining repayment of any of the
Obligations; (vi) the impairment of any collateral securing any of the
Obligations, including without limitation the failure to perfect or preserve any
rights which the Agent or any Bank might have in such collateral security or the
substitution, exchange, surrender, release, loss or destruction of any such
collateral security; or (vii) any other act or omission which might in any
manner or to any extent vary the risk of the Guarantor or otherwise operate as a
release or discharge of the Guarantor, all of which may be done without notice
to the Guarantor. To the fullest extent permitted by law, the Guarantor hereby
expressly waives any and all rights or defenses arising by reason of (A) any
"one action" or "anti-deficiency" law which would otherwise prevent the Agent or
any Bank from bringing any action, including any claim for a deficiency, or
exercising any other right or remedy (including any right of set-off), against
the Guarantor before or after the Agent's or such Bank's commencement or
completion of any foreclosure action, whether judicially, by exercise of power
of sale or otherwise, or (B) any other law which in any other way would
otherwise require any election of remedies by the Agent or any Bank.
5. UNENFORCEABILITY OF OBLIGATIONS AGAINST COMPANY. If for any reason the
Company has no legal existence or is under no legal obligation to discharge any
of the Obligations, or if any of the Obligations have become irrecoverable from
the Company by reason of the Company's insolvency, bankruptcy or reorganization
or by other operation of law or for any other reason, this Guaranty shall
nevertheless be binding on the Guarantor to the same extent as if the Guarantor
at all times had been the principal obligor on all such Obligations. In the
event that acceleration of the time for payment of any of the Obligations is
stayed upon the insolvency, bankruptcy or reorganization of the Company, or for
any other reason, all such amounts otherwise subject to acceleration under the
terms of the Credit Agreement, the Notes, the other Loan Documents or any other
agreement evidencing, securing or otherwise executed in connection with any
Obligation shall be immediately due and payable by the Guarantor.
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6. SUBROGATION; SUBORDINATION.
6.1. WAIVER OF RIGHTS AGAINST COMPANY. Until the final payment and
performance in full of all of the Obligations, the Guarantor shall not
exercise and hereby waives any rights against the Company arising as a
result of payment by the Guarantor hereunder, by way of subrogation,
reimbursement, restitution, contribution or otherwise, and will not prove
any claim in competition with the Agent or any Bank in respect of any
payment hereunder in any bankruptcy, insolvency or reorganization case or
proceedings of any nature; the Guarantor will not claim any setoff,
recoupment or counterclaim against the Company in respect of any liability
of the Guarantor to the Company; and the Guarantor waives any benefit of and
any right to participate in any collateral security which may be held by the
Agent or any Bank.
6.2. SUBORDINATION. The payment of any amounts due with respect to any
indebtedness of the Company for money borrowed or credit received now or
hereafter owed to the Guarantor is hereby subordinated to the prior payment
in full of all of the Obligations. The Guarantor agrees that, after the
occurrence of any default in the payment or performance of any of the
Obligations, the Guarantor will not demand, ▇▇▇ for or otherwise attempt to
collect any such indebtedness of the Company to the Guarantor until all of
the Obligations shall have been paid in full. If, notwithstanding the
foregoing sentence, the Guarantor shall collect, enforce or receive any
amounts in respect of such indebtedness while any Obligations are still
outstanding, such amounts shall be collected, enforced and received by the
Guarantor as trustee for the Banks and the Agent and be paid over to the
Agent, for the benefit of the Banks and the Agent, on account of the
Obligations without affecting in any manner the liability of the Guarantor
under the other provisions of this Guaranty.
6.3. PROVISIONS SUPPLEMENTAL. The provisions of this ss.6 shall be
supplemental to and not in derogation of any rights and remedies of the
Banks and the Agent under any separate subordination agreement which the
Agent may at any time and from time to time enter into with the Guarantor
for the benefit of the Banks and the Agent.
7. SECURITY; SETOFF. The Guarantor grants to each of the Agent and the
Banks, as security for the full and punctual payment and performance of all of
the Guarantor's obligations hereunder, a continuing lien on and security
interest in all securities or other property belonging to the Guarantor now or
hereafter held by the Agent or such Bank and in all deposits (general or
special, time or demand, provisional or final) and other sums credited by or due
from the Agent or such Bank to the Guarantor or subject to withdrawal by the
Guarantor. Regardless of the adequacy of any collateral security or other means
of obtaining payment of any of the Obligations, each of the Agent and the Banks
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is hereby authorized at any time and from time to time, without notice to the
Guarantor (any such notice being expressly waived by the Guarantor) and to the
fullest extent permitted by law, to set off and apply such deposits and other
sums against the obligations of the Guarantor under this Guaranty, whether or
not the Agent or such Bank shall have made any demand under this Guaranty and
although such obligations may be contingent or unmatured.
8. FURTHER ASSURANCES. The Guarantor agrees that it will from time to time,
at the request of the Agent, do all such things and execute all such documents
as the Agent may consider necessary or desirable to give full effect to this
Guaranty and to perfect and preserve the rights and powers of the Banks and the
Agent hereunder. The Guarantor acknowledges and confirms that the Guarantor
itself has established its own adequate means of obtaining from the Company on a
continuing basis all information desired by the Guarantor concerning the
financial condition of the Company and that the Guarantor will look to the
Company and not to the Agent or any Bank in order for the Guarantor to keep
adequately informed of changes in the Company's financial condition.
9. TERMINATION; REINSTATEMENT. This Guaranty shall remain in full force and
effect until the Agent is given written notice of the Guarantor's intention to
discontinue this Guaranty, notwithstanding any intermediate or temporary payment
or settlement of the whole or any part of the Obligations. No such notice shall
be effective unless received and acknowledged by an officer of the Agent at the
address of the Agent for notices set forth in ss.20 of the Credit Agreement. No
such notice shall affect any rights of the Agent or any Bank hereunder,
including without limitation the rights set forth in secs.4 and 6, with respect
to any Obligations incurred or accrued prior to the receipt of such notice or
any Obligations incurred or accrued pursuant to any contract or commitment in
existence prior to such receipt. This Guaranty shall continue to be effective or
be reinstated, notwithstanding any such notice, if at any time any payment made
or value received with respect to any Obligation 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 or value received.
10. SUCCESSORS AND ASSIGNS. This Guaranty shall be binding upon the
Guarantor, its successors and assigns, and shall inure to the benefit of the
Agent and the Banks and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing sentence, each Bank may assign
or otherwise transfer the Credit Agreement, the Notes, the other Loan Documents
or any other agreement or note held by it evidencing, securing or otherwise
executed in connection with the Obligations, or sell participations in any
interest therein, to any other entity or other person, and such other entity or
other person shall thereupon become vested, to the extent set forth in the
agreement evidencing such assignment, transfer or participation, with all the
rights in respect thereof granted to such Bank herein, all in accordance with
ss.19
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of the Credit Agreement. The Guarantor may not assign any of its obligations
hereunder.
11. AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by the Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Agent with the
consent of the Majority Banks. No failure on the part of the Agent or any Bank
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.
12. NOTICES. All notices and other communications called for hereunder shall
be made in writing and, unless otherwise specifically provided herein, shall be
deemed to have been duly made or given when delivered by hand or mailed first
class, postage prepaid, or, in the case of telegraphic or telexed notice, when
transmitted, answer back received, addressed as follows: if to the Guarantor, at
the address set forth beneath its signature hereto, and if to the Agent, at the
address for notices to the Agent set forth in ss.20 of the Credit Agreement, or
at such address as either party may designate in writing to the other.
13. GOVERNING LAW; CONSENT TO JURISDICTION. THIS GUARANTY IS INTENDED TO
TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS. The Guarantor
agrees that any suit for the enforcement of this Guaranty may be brought in the
courts of the Commonwealth of Massachusetts or any federal court sitting therein
and consents to the nonexclusive jurisdiction of such court and to service of
process in any such suit being made upon the Guarantor by mail at the address
specified by reference in ss.12. The Guarantor hereby waives any objection that
it may now or hereafter have to the venue of any such suit or any such court or
that such suit was brought in an inconvenient court.
14. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY WAIVES ITS RIGHT TO A JURY
TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE
PERFORMANCE OF ANY OF SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law,
the Guarantor hereby waives any right which it may have to claim or recover in
any litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. The Guarantor (i) certifies that neither the Agent or any Bank
nor any representative, agent or attorney of the Agent or any Bank has
represented, expressly or otherwise, that the Agent or any Bank would not, in
the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that, in entering into the Credit Agreement and the other Loan
Documents to which the Agent or any Bank is a party, the Agent and the
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Banks are relying upon, among other things, the waivers and certifications
contained in this ss.14.
15. MISCELLANEOUS. This Guaranty constitutes the entire agreement of the
Guarantor with respect to the matters set forth herein. The rights and remedies
herein provided are cumulative and not exclusive of any remedies provided by law
or any other agreement, and this Guaranty shall be in addition to any other
guaranty of or collateral security for any of the Obligations. The invalidity or
unenforceability of any one or more sections of this Guaranty shall not affect
the validity or enforceability of its remaining provisions. Captions are for the
ease of reference only and shall not affect the meaning of the relevant
provisions. The meanings of all defined terms used in this Guaranty shall be
equally applicable to the singular and plural forms of the terms defined.
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IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
and delivered as of the date first above written.
HADCO ACQUISITION CORP. II
By: ________________________________
Title:
Address: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇