Subsidiary Guaranty Agreement Dated as of December 12, 2007
Exhibit 10.10
Dated as
of December 12, 2007
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$200,000,000
6.11% Series 2007-A Senior Notes
Due
December 12, 2019
and
Additional
Notes
of
Granite
Construction Incorporated
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Re:
Table
of Contents
(Not a
part of the Agreement)
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SECTION 1.DEFINITIONS..........2
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SECTION 2.GUARANTY
OF NOTES AND NOTE AGREEMENT..........2
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SECTION 3.GUARANTY
OF PAYMENT AND PERFORMANCE..........3
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SECTION 4.GENERAL
PROVISIONS RELATING TO THE GUARANTY..........4
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SECTION 5.REPRESENTATIONS
AND WARRANTIES OF THE GUARANTORS..........9
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SECTION 6.AMENDMENTS,
WAIVERS AND CONSENTS..........13
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SECTION 7.NOTICES..........14
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Re: $200,000,000
6.11% Series 2007-A Senior Notes
Due
December 12, 2019
and
Additional
Notes
of
Granite Construction
Incorporated
This
Subsidiary Guaranty Agreement dated as of December 12, 2007 (the or this “Guaranty”) is entered into
on a joint and several basis by each of the undersigned, together with any
entity which may become a party hereto by execution and delivery of a Subsidiary
Guaranty Supplement in substantially the form set forth as Exhibit A hereto
(a “Guaranty
Supplement”) (which parties are hereinafter referred to individually as a
“Guarantor” and
collectively as the “Guarantors”).
Recitals
A. Each
Guarantor is a subsidiary of Granite Construction Incorporated, a Delaware
corporation (the “Company”), and a Material
Subsidiary (as defined in the hereinafter defined Note Agreement).
B. The
Company has entered into that certain Note Purchase Agreement dated as of
December 12, 2007 (as the same may be amended, supplemented, restated or
otherwise modified from time to time, the “Note Agreement”) between the
Company and each of the purchasers named on Schedule A attached to said
Note Agreement (the “2007-A
Note Purchasers”), providing for, among other things, the issue and sale
by the Company to the 2007-A Note Purchasers of $200,000,000 aggregate principal
amount of its 6.11% Series 2007-A Senior Notes, due December 12, 2019 (as
amended, modified, supplemented or restated from time to time, the “Series 2007-A
Notes”).
C. Pursuant
to the Note Agreement, the Company may, from time to time, issue one or more
additional Series (as defined in the Note Agreement) of its unsecured promissory
notes (as amended, modified, supplemented or restated from time to time, the
“Additional Notes,” and
collectively with the Series 2007-A Notes, the “Notes”) to purchasers (“Additional Purchasers”)
pursuant to a supplement (a “Supplement”), provided that the aggregate
principal amount of Additional Notes issued pursuant to Supplements in
accordance with the terms of Section 2.2 of the Note Agreement shall not exceed
$100,000,000. In connection with the issuance of each Series of
Additional Notes, the Guarantors will execute and deliver a Guaranty Accession
Agreement in the form attached hereto as Exhibit B confirming that such Series
of Additional Notes constitutes Notes hereunder and are entitled to the benefits
hereof. The 2007-A Note Purchasers and the Additional Purchasers
together with their respective successors and assigns are collectively referred
to herein as the “Holders.”
D. The
2007-A Note Purchasers have required as a condition of their purchase of the
Series 2007-A Notes and it is a condition of each Additional Purchaser’s
purchase of Additional Notes that the Company cause each of the undersigned to
enter into this Guaranty and to cause from time to time each Material Subsidiary
to enter into a Guaranty Supplement, in each case as security for the Notes, and
the Company has agreed to cause each of the undersigned to execute this Guaranty
and to cause each from time to time Material Subsidiary to execute a Guaranty
Supplement, in each case in order to induce the 2007-A Note Purchasers and the
Additional Purchasers to purchase the Notes and thereby benefit the Company and
its Subsidiaries (as defined in the Note Agreement) by providing funds to the
Company for the purposes described in Section 5.14 of the Note Agreement or in
the case of any Additional Notes, for the purposes described in the related
Supplement.
Now,
therefore, as required by Section 4.4 of the Note Agreement and in
consideration of the premises and other good and valuable consideration, the
receipt and sufficiency whereof are hereby acknowledged, each Guarantor does
hereby covenant and agree, jointly and severally, as follows:
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Section 1.
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Definitions.
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Capitalized
terms used herein shall have the meanings set forth in the Note Agreement unless
herein defined or the context shall otherwise require.
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Section 2.
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Guaranty
of Notes and Note Agreement.
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(a) Each
Guarantor jointly and severally does hereby irrevocably, absolutely and
unconditionally guarantee unto the Holders: (1) the full and
prompt payment of the principal of, premium, if any, and interest on the Notes
from time to time outstanding, as and when such payments shall become due and
payable whether by lapse of time, upon redemption or prepayment, by extension or
by acceleration or declaration or otherwise (including (to the extent legally
enforceable) interest due on overdue payments of principal, premium, if any, or
interest at the rate set forth in the Notes) in federal or other immediately
available funds of the United States of America which at the time of payment or
demand therefor shall be legal tender for the payment of public and private
debts, (2) the full and prompt performance and observance by the Company of each
and all of the obligations, covenants and agreements required to be performed or
owed by the Company under the terms of the Notes and the Note Agreement
(including any Supplement) and (3) the full and prompt payment, upon demand
by any Holder of all costs and expenses, legal or otherwise (including
reasonable attorneys’ fees), if any, as shall have been expended or incurred in
the protection or enforcement of any rights, privileges or liabilities in favor
of the Holders under or in respect of the Notes, the Note Agreement (including
any Supplement) or under this Guaranty or in any consultation or action in
connection therewith or herewith.
(b) To
the extent that any Guarantor shall make a payment hereunder (a “Payment”) which, taking into
account all other Payments previously or concurrently made by any of the other
Guarantors, exceeds the amount which such Guarantor would otherwise have paid if
each Guarantor had paid the aggregate obligations satisfied by such Payment in
the same proportion as such Guarantor’s Allocable Amount (as hereinafter
defined) in effect immediately prior to such Payment bore to the Aggregate
Allocable Amount (as hereinafter defined) of all of the Guarantors in effect
immediately prior to the making of such Payment, then such Guarantor shall be
entitled to contribution and indemnification from, and be reimbursed by, each of
the other Guarantors for the amount of such excess, pro rata based upon their
respective Allocable Amounts in effect immediately prior to such Payment; provided that each Guarantor
covenants and agrees that such right of contribution and indemnification and any
and all claims of such Guarantor against any other Guarantor, any endorser or
against any of their property shall be junior and subordinate in right of
payment to the prior indefeasible final payment in cash in full of all of the
Notes and satisfaction by the Company of its obligations under the Note Purchase
Agreement (including each Supplement) and by the Guarantors of their obligations
under this Guaranty and the Guarantors shall not take any action to enforce such
right of contribution and indemnification, and the Guarantors shall not accept
any payment in respect of such right of contribution and indemnification, until
all of the Notes and all amounts payable by the Guarantors hereunder have
indefeasibly been finally paid in cash in full and all of the obligations of the
Company under the Note Purchase Agreement (including each Supplement) and of the
Guarantors under this Guaranty have been satisfied
As of any
date of determination, (1) the “Allocable Amount” of any
Guarantor shall be equal to the maximum amount which could then be claimed by
the Holders under this Guaranty without rendering such claim voidable or
avoidable under ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code
(11 U.S.C. Sec. 101 et. seq.) or under any applicable state Uniform Fraudulent
Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common
law; and (2) the “Aggregate
Allocable Amount” shall be equal to the sum of each Guarantor’s Allocable
Amount.
This
clause (b) is intended only to define the relative rights of the Guarantors, and
nothing set forth in this clause (b) is intended to or shall impair the
obligations of the Guarantors, jointly and severally, to pay any amounts to the
Holders as and when the same shall become due and payable in accordance
herewith.
Each
Guarantor acknowledges that the rights of contribution and indemnification
hereunder shall constitute an asset in favor of any Guarantor to which such
contribution and indemnification is owing.
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Section 3.
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Guaranty
of Payment and Performance.
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This is a
guarantee of payment and performance and each Guarantor hereby waives, to the
fullest extent permitted by law, any right to require that any action on or in
respect of any Note or the Note Agreement (including any Supplement) be brought
against the Company or any other Person or that resort be had to any direct or
indirect security for the Notes or for this Guaranty or any other
remedy. Any Holder may, at its option, proceed hereunder against any
Guarantor in the first instance to collect monies when due, the payment of which
is guaranteed hereby, without first proceeding against the Company or any other
Person and without first resorting to any direct or indirect security for the
Notes or for this Guaranty or any other remedy. The liability of each
Guarantor hereunder shall in no way be affected or impaired by any acceptance by
any Holder of any direct or indirect security for, or other guaranties of, any
Debt, liability or obligation of the Company or any other Person to any Holder
or by any failure, delay, neglect or omission by any Holder to realize upon or
protect any such guarantees, Debt, liability or obligation or any notes or other
instruments evidencing the same or any direct or indirect security therefor or
by any approval, consent, waiver, or other action taken, or omitted to be taken
by any such Holder.
The
covenants and agreements on the part of the Guarantors herein contained shall
take effect as joint and several covenants and agreements, and references to the
Guarantors shall take effect as references to each of them and none of them
shall be released from liability hereunder by reason of the guarantee ceasing to
be binding as a continuing security on any other of them.
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Section 4.
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General
Provisions Relating to the
Guaranty.
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(a) Each
Guarantor hereby consents and agrees that any Holder or Holders from time to
time, with or without any further notice to or assent from any other Guarantor
may, without in any manner affecting the liability of any Guarantor under this
Guaranty, and upon such terms and conditions as any such Holder or Holders may
deem advisable:
(1)extend in whole or in part (by renewal
or otherwise), modify, change, compromise, release or extend the duration of the
time for the performance or payment of any Debt, liability or obligation of the
Company or of any other Person secondarily or otherwise liable for any Debt,
liability or obligations of the Company on the Notes, or waive any Default with
respect thereto, or waive, modify, amend or change any provision of any other
agreement or waive this Guaranty; or
(2)sell, release, surrender, modify,
impair, exchange or substitute any and all property, of any nature and from
whomsoever received, held by, or for the benefit of, any such Holder as direct
or indirect security for the payment or performance of any Debt, liability or
obligation of the Company or of any other Person secondarily or otherwise liable
for any Debt, liability or obligation of the Company on the Notes;
or
(3)settle, adjust or compromise any claim
of the Company against any other Person secondarily or otherwise liable for any
Debt, liability or obligation of the Company on the Notes.
Each
Guarantor hereby ratifies and confirms any such extension, renewal, change,
sale, release, waiver, surrender, exchange, modification, amendment, impairment,
substitution, settlement, adjustment or compromise and that the same shall be
binding upon it, and hereby waives, to the fullest extent permitted by law, any
and all defenses, counterclaims or offsets which it might or could have by
reason thereof, it being understood that such Guarantor shall at all times be
bound by this Guaranty and remain liable hereunder.
(b) Each
Guarantor hereby waives, to the fullest extent permitted by law:
(1)notice of acceptance of this Guaranty
by the Holders or of the creation, renewal or accrual of any liability of the
Company, present or future, or of the reliance of such Holders upon this
Guaranty (it being understood that every Debt, liability and obligation
described in Section 2 hereof shall conclusively be presumed to have been
created, contracted or incurred in reliance upon the execution of this
Guaranty);
(2)notice of the issuance of any
Additional Notes pursuant to the Note Agreement or any Supplement
thereto;
(3)demand of payment by any Holder from
the Company or any other Person indebted in any manner on or for any of the
Debt, liabilities or obligations hereby guaranteed; and
(4)presentment for the payment by any
Holder or any other Person of the Notes or any other instrument, protest thereof
and notice of its dishonor to any party thereto and to such
Guarantor.
The
obligations of each Guarantor under this Guaranty and the rights of any Holder
to enforce such obligations by any proceedings, whether by action at law, suit
in equity or otherwise, shall not be subject to any reduction, limitation,
impairment or termination, whether by reason of any claim of any character
whatsoever or otherwise and shall not be subject to any defense, set-off,
counterclaim (other than any compulsory counterclaim), recoupment or termination
whatsoever.
(c) The
obligations of the Guarantors hereunder shall be binding upon the Guarantors and
their successors and assigns, and shall remain in full force and effect
irrespective of:
(1)the genuineness, validity, regularity
or enforceability of the Notes, the Note Agreement, any Supplement or any other
agreement or any of the terms of any thereof, the continuance of any obligation
on the part of the Company or any other Person on or in respect of the Notes or
under the Note Agreement, any Supplement or any other agreement or the power or
authority or the lack of power or authority of the Company to issue the Notes or
the Company to execute and deliver the Note Agreement, any Supplement or any
other agreement or of any Guarantor to execute and deliver this Guaranty or to
perform any of its obligations hereunder or the existence or continuance of the
Company or any other Person as a legal entity; or
(2)any default, failure or delay, willful
or otherwise, in the performance by the Company, any Guarantor or any other
Person of any obligations of any kind or character whatsoever under the Notes,
the Note Agreement, any Supplement, this Guaranty or any other agreement;
or
(3)any creditors’ rights, bankruptcy,
receivership or other insolvency proceeding of the Company, any Guarantor or any
other Person or in respect of the property of the Company, any Guarantor or any
other Person or any merger, consolidation, reorganization, dissolution,
liquidation, the sale of all or substantially all of the assets of or winding up
of the Company, any Guarantor or any other Person; or
(4)impossibility or illegality of
performance on the part of the Company, any Guarantor or any other Person of its
obligations under the Notes, the Note Agreement, any Supplement, this Guaranty
or any other agreements; or
(5)in respect of the Company or any other
Person, any change of circumstances, whether or not foreseen or foreseeable,
whether or not imputable to the Company or any other Person, or other
impossibility of performance through fire, explosion, accident, labor
disturbance, floods, droughts, embargoes, wars (whether or not declared), civil
commotion, acts of God or the public enemy, delays or failure of suppliers or
carriers, inability to obtain materials, action of any federal or state
regulatory body or agency, change of law or any other causes affecting
performance, or any other force majeure, whether or not
beyond the control of the Company or any other Person and whether or not of the
kind hereinbefore specified; or
(6)any attachment, claim, demand, charge,
Lien, order, process, encumbrance or any other happening or event or reason,
similar or dissimilar to the foregoing, or any withholding or diminution at the
source, by reason of any taxes, assessments, expenses, Debt, obligations or
liabilities of any character, foreseen or unforeseen, and whether or not valid,
incurred by or against the Company, any Guarantor or any other Person or any
claims, demands, charges or Liens of any nature, foreseen or unforeseen,
incurred by the Company, any Guarantor or any other Person, or against any sums
payable in respect of the Notes or under the Note Agreement, any Supplement or
this Guaranty, so that such sums would be rendered inadequate or would be
unavailable to make the payments herein provided; or
(7)any order, judgment, decree, ruling or
regulation (whether or not valid) of any court of any nation or of any political
subdivision thereof or any body, agency, department, official or administrative
or regulatory agency of any thereof or any other action, happening, event or
reason whatsoever which shall delay, interfere with, hinder or prevent, or in
any way adversely affect, the performance by the Company, any Guarantor or any
other Person of its respective obligations under or in respect of the Notes, the
Note Agreement, any Supplement, this Guaranty or any other agreement;
or
(8)the failure of any Guarantor to receive
any benefit from or as a result of its execution, delivery and performance of
this Guaranty; or
(9)any failure or lack of diligence in
collection or protection, failure in presentment or demand for payment, protest,
notice of protest, notice of default and of nonpayment, any failure to give
notice to any Guarantor of failure of the Company, any Guarantor or any other
Person to keep and perform any obligation, covenant or agreement under the terms
of the Notes, the Note Agreement, any Supplement, this Guaranty or any other
agreement or failure to resort for payment to the Company, any Guarantor or to
any other Person or to any other guaranty or to any property, security, Liens or
other rights or remedies; or
(10)the acceptance of any additional
security or other guaranty, the advance of additional money to the Company or
any other Person, the renewal or extension of the Notes or amendments,
modifications, consents or waivers with respect to the Notes, the Note
Agreement, any Supplement or any other agreement, or the sale, release,
substitution or exchange of any security for the Notes; or
(11)the failure to execute a Guaranty
Accession Agreement in connection with the issuance of any Series of Additional
Notes; or
(12)any merger or consolidation of the
Company, any Guarantor or any other Person into or with any other Person or any
sale, lease, transfer or other disposition of any of the assets of the Company,
any Guarantor or any other Person to any other Person, or any change in the
ownership of any shares of the Company, any Guarantor or any other Person;
or
(13)any defense whatsoever
that: (i) the Company or any other Person might have to the payment
of the Notes (principal, premium, if any, or interest), other than payment
thereof in federal or other immediately available funds or (ii) the Company or
any other Person might have to the performance or observance of any of the
provisions of the Notes, the Note Agreement, any Supplement or any other
agreement, whether through the satisfaction or purported satisfaction by the
Company or any other Person of its debts due to any cause such as bankruptcy,
insolvency, receivership, merger, consolidation, reorganization, dissolution,
liquidation, winding-up or otherwise; or
(14)any act or failure to act with regard
to the Notes, the Note Agreement, any Supplement, this Guaranty or any other
agreement or anything which might vary the risk of any Guarantor or any other
Person; or
(15)any other circumstance which might
otherwise constitute a defense available to, or a discharge of, any Guarantor or
any other Person in respect of the obligations of any Guarantor or other Person
under this Guaranty or any other agreement;
provided that the specific
enumeration of the above-mentioned acts, failures or omissions shall not be
deemed to exclude any other acts, failures or omissions, though not specifically
mentioned above, it being the purpose and intent of this Guaranty and the
parties hereto that the obligations of each Guarantor shall be absolute and
unconditional and shall not be discharged, impaired or varied except by the
payment of the principal of, premium, if any, and interest on the Notes in
accordance with their respective terms whenever the same shall become due and
payable as in the Notes provided, at the place specified in and all in the
manner and with the effect provided in the Notes and the Note Agreement, as each
may be amended or modified from time to time. Without limiting the
foregoing, it is understood that repeated and successive demands may be made and
recoveries may be had hereunder as and when, from time to time, the Company
shall default under or in respect of the terms of the Notes or the Note
Agreement (including any Supplement) and that notwithstanding recovery hereunder
for or in respect of any given default or defaults by the Company under the
Notes or the Note Agreement (including any Supplement), this Guaranty shall
remain in full force and effect and shall apply to each and every subsequent
default.
(d) All
rights of any Holder may be transferred or assigned at any time and shall be
considered to be transferred or assigned at any time or from time to time upon
the transfer of such Note whether with or without the consent of or notice to
the Guarantors under this Guaranty or to the Company.
(e) To
the extent of any payments made under this Guaranty, the Guarantors shall be
subrogated to the rights of the Holder or Holders upon whose Notes such payment
was made, but each Guarantor covenants and agrees that such right of subrogation
shall be junior and subordinate in right of payment to the prior indefeasible
final payment in cash in full of all amounts due and owing by the Company with
respect to the Notes and the Note Agreement (including each Supplement) and by
the Guarantors under this Guaranty, and the Guarantors shall not take any action
to enforce such right of subrogation, and the Guarantors shall not accept any
payment in respect of such right of subrogation, until all amounts due and owing
by the Company under or in respect of the Notes and the Note Agreement
(including each Supplement) and all amounts due and owing by the Guarantors
hereunder have indefeasibly been finally paid in cash in full. If any
amount shall be paid to any Guarantor in violation of the preceding sentence at
any time prior to the later of the indefeasible payment in cash in full of the
Notes and all other amounts payable under the Notes, the Note Agreement
(including each Supplement) and this Guaranty, such amount shall be held in
trust for the benefit of the Holders and shall forthwith be paid to the Holders
to be credited and applied to the amounts due or to become due with respect to
the Notes and all other amounts payable under the Note Agreement (including each
Supplement) and this Guaranty, whether matured or unmatured.
(f) Each
Guarantor agrees that to the extent the Company or any other Person makes any
payment on any Note, which payment or any part thereof is subsequently
invalidated, voided, declared to be fraudulent or preferential, set aside,
recovered, rescinded or is required to be retained by or repaid to a trustee,
receiver, or any other Person under any bankruptcy code, common law, or
equitable cause, then and to the extent of such payment, the obligation or the
part thereof intended to be satisfied shall be revived and continued in full
force and effect with respect to the Guarantors’ obligations hereunder, as if
said payment had not been made. The liability of the Guarantors
hereunder shall not be reduced or discharged, in whole or in part, by any
payment to any Holder from any source that is thereafter paid, returned or
refunded in whole or in part by reason of the assertion of a claim of any kind
relating thereto, including, but not limited to, any claim for breach of
contract, breach of warranty, preference, illegality, invalidity or fraud
asserted by any account debtor or by any other Person.
(g) No
Holder shall be under any obligation: (1) to marshal any assets in
favor of the Guarantors or in payment of any or all of the liabilities of the
Company under or in respect of the Notes or the obligations of the Guarantors
hereunder or (2) to pursue any other remedy that the Guarantors may or may not
be able to pursue themselves and that may lighten the Guarantors’ burden, any
right to which each Guarantor hereby expressly waives.
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Section 5.
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Representations
and Warranties of the Guarantors.
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Each
Guarantor represents and warrants to each Holder that:
(a) Such
Guarantor is a corporation or other legal entity duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, and is duly qualified as a foreign corporation or other legal
entity and is in good standing in each jurisdiction in which such qualification
is required by law, other than those jurisdictions as to which the failure to be
so qualified or in good standing could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on (1) the
business, operations, affairs, financial condition, assets, properties or
prospects of such Guarantor and its subsidiaries, taken as a whole, or
(2) the ability of such Guarantor to perform its obligations under this
Guaranty or (3) the validity or enforceability of this Guaranty (herein in
this Section 5, a “Material Adverse
Effect”). Such Guarantor has the power and authority to own or
hold under lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute and
deliver this Guaranty and to perform the provisions hereof.
(b) Each
subsidiary of such Guarantor is a corporation or other legal entity duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a foreign corporation or
other legal entity and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect. Each subsidiary of such Guarantor has the power and authority
to own or hold under lease the properties it purports to own or hold under lease
and to transact the business it transacts and proposes to transact.
(c) This
Guaranty has been duly authorized by all necessary action on the part of such
Guarantor, and this Guaranty constitutes a legal, valid and binding obligation
of such Guarantor enforceable against such Guarantor in accordance with its
terms, except as such enforceability may be limited by (1) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally and (2) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(d) This
Guaranty, the documents, certificates or other writings identified in
Schedule 5.3 to the Note Agreement and the financial statements listed in
Schedule 5.5 to the Note Agreement, taken as a whole, do not contain any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading in light of the circumstances
under which they were made. Except as disclosed in the Disclosure
Documents, since December 31, 2006, there has been no adverse Material (as
hereinafter defined) change in the financial condition, operations, business,
properties or prospects of such Guarantor or any of its subsidiaries, taken as a
whole.
(e) The
execution, delivery and performance by such Guarantor of this Guaranty will not
(1) contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of such Guarantor
or any of its subsidiaries under any indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease, charter document or by-law, or any other
agreement or instrument to which such Guarantor or any of its subsidiaries is
bound or by which such Guarantor or any of its subsidiaries or any of their
respective properties may be bound or affected, (2) conflict with or result
in a breach of any of the terms, conditions or provisions of any order,
judgment, decree or ruling of any court, arbitrator or Governmental Authority
applicable to such Guarantor or any of its subsidiaries or (3) violate any
provision of any statute or other rule or regulation of any Governmental
Authority applicable to such Guarantor or any of its subsidiaries.
(f) No
consent, approval or authorization of, or registration, filing or declaration
with, any Governmental Authority is required in connection with the execution,
delivery or performance by such Guarantor of this Guaranty.
(g) (1) There
are no actions, suits, investigations or proceedings pending or, to the
knowledge of such Guarantor, threatened against or affecting such Guarantor or
any of its subsidiaries or any property of such Guarantor or any of its
subsidiaries in any court or before any arbitrator of any kind or before or by
any Governmental Authority that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(2) Neither
such Guarantor nor any of its subsidiaries is in default under any term of any
agreement or instrument to which it is a party or by which it is bound, or any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including without limitation Environmental Laws, ERISA or the USA
Patriot Act) of any Governmental Authority, which default or violation,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
(h) Such
Guarantor and its subsidiaries have filed all income tax returns that are
required to have been filed in any jurisdiction, and have paid all taxes shown
to be due and payable on such returns and all other taxes and assessments
payable by them, to the extent such taxes and assessments have become due and
payable and before they have become delinquent, except for any taxes and
assessments (1) the amount of which is not individually or in the aggregate
material to the business, operations, affairs, financial condition, assets,
properties or prospects of such Guarantor and its subsidiaries, taken as a whole
(herein in this Section 5, “Material”) or (2) the
amount, applicability or validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which such Guarantor or one
of its subsidiaries, as the case may be, has established adequate reserves in
accordance with GAAP. Such Guarantor knows of no basis for any other
tax or assessment that could reasonably be expected to have a Material Adverse
Effect. The charges, accruals and reserves on the books of such
Guarantor and its subsidiaries in respect of federal, state or other taxes for
all fiscal periods are adequate. The federal income tax liabilities
of such Guarantor and its subsidiaries have been finally determined (whether by
reason of completed audits or the statute of limitations having run) for all
fiscal years up to and including the fiscal year ended December 31,
2003.
(i) Such
Guarantor and its subsidiaries have good and sufficient title to their
respective properties that individually or in the aggregate are Material,
including all such properties reflected in the most recent audited balance sheet
referred to in Section 5.5 of the Note Agreement or purported to have been
acquired by such Guarantor or any of its subsidiaries after said date (except as
sold or otherwise disposed of in the ordinary course of business), in each case
free and clear of Liens prohibited by the Note Agreement. All leases
that individually or in the aggregate are Material are valid and subsisting and
are in full force and effect in all material respects.
(j) (1) Such
Guarantor and its subsidiaries own or possess all Material licenses, permits,
franchises, authorizations, patents, copyrights, proprietary software, service
marks, trademarks, trade names and domain names, or other rights with respect
thereto.
(2) To
the best knowledge of such Guarantor, no product of such Guarantor or any of its
subsidiaries infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, proprietary software, service ▇▇▇▇, trademark,
trade name, domain name or other right with respect thereto owned by any other
Person.
(3) To
the best knowledge of such Guarantor, there is no Material violation by any
Person of any right of such Guarantor or any of its subsidiaries with respect to
any patent, copyright, proprietary software, service ▇▇▇▇, trademark, trade name
or other right with respect thereto owned or used by such Guarantor or any of
its subsidiaries.
(k) (1) Such
Guarantor and each ERISA Affiliate have operated and administered each Plan in
compliance with all applicable laws in all material respects. Neither
such Guarantor nor any ERISA Affiliate has incurred any Material liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions
of the Code relating to employee benefit plans (as defined in Section 3 of
ERISA), and no event, transaction or condition has occurred or exists that could
reasonably be expected to result in the incurrence of any such Material
liability by such Guarantor or any ERISA Affiliate, or in the imposition of any
Material Lien on any of the rights, properties or assets of such Guarantor or
any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or
to such penalty or excise tax provisions or to Section 401(a)(29) or 412 of
the Code or Section 4068 of ERISA.
(2) The
present value of the aggregate benefit liabilities under each of the Plans
(other than Multiemployer Plans), determined as of the end of such Plan’s most
recently ended plan year on the basis of the actuarial assumptions specified for
funding purposes in such Plan’s most recent actuarial valuation report, did not
exceed the aggregate current value of the assets of such Plan allocable to such
benefit liabilities by more than $5,000,000 in the aggregate for all
Plans. The term “benefit liabilities” has the meaning specified in
Section 4001 of ERISA and the terms “current value” and “present value”
have the meanings specified in Section 3 of ERISA.
(3) Such
Guarantor and its ERISA Affiliates have not incurred Material withdrawal
liabilities (and are not subject to Material contingent withdrawal liabilities)
under Section 4201 or 4204 of ERISA in respect of Multiemployer
Plans.
(4) The
expected postretirement benefit obligation (determined as of the last day of
such Guarantor’s most recently ended fiscal year in accordance with Financial
Accounting Standards Board Statement No. 106, without regard to liabilities
attributable to continuation coverage mandated by Section 4980B of the
Code) of such Guarantor and its subsidiaries is not Material.
(5) The
execution and delivery of this Guaranty will not involve any transaction that is
subject to the prohibitions of Section 406 of ERISA or in connection with
which a tax could be imposed pursuant to Section 4975(c)(1)(A)-(D) of the
Code. The representation by such Guarantor in the first sentence of
this Section 5(k)(5) is made in reliance upon and subject to the accuracy
of each Holder’s representation in Section 6.2 of the Note Agreement as to
the sources of the funds used to pay the purchase price of the Notes to be
purchased by such Holder.
(l) Neither
such Guarantor nor any of its subsidiaries is an “investment company” registered
or required to be registered under the Investment Company Act of 1940, as
amended, or is subject to regulation under the Public Utility Holding Company
Act of 2005, as amended, the ICC Termination Act of 1995, as amended, or the
Federal Power Act, as amended.
(m) Neither
such Guarantor nor any of its subsidiaries has knowledge of any Material claim
or has received any notice of any Material claim, and no proceeding has been
instituted raising any Material claim against such Guarantor or any of its
subsidiaries or any of their respective real properties now or formerly owned,
leased or operated by any of them or other assets, alleging any damage to the
environment or violation of any Environmental Laws.
(1)Neither such Guarantor nor any of its
subsidiaries has knowledge of any facts which would give rise to any Material
claim, public or private, or Material violation of Environmental Laws or damage
to the environment emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of them or to other
assets or their use.
(2)Neither the Company nor any of its
subsidiaries (i) has stored any Hazardous Materials on real properties now
or formerly owned, leased or operated by any of them or (ii) has disposed
of any Hazardous Materials in a manner contrary to any Environmental Laws; in
each case in any manner that could reasonably be expected to result in a
Material Adverse Effect.
(3)All buildings on all real properties
now owned, leased or operated by such Guarantor or any of its subsidiaries are
in material compliance with applicable Environmental Laws.
(n) Such
Guarantor, when viewed on a consolidated basis with the Company and its other
Subsidiaries, is solvent, has capital not unreasonably small in relation to its
business or any contemplated or undertaken transaction and has assets having a
value both at fair valuation and at present fair salable value greater than the
amount required to pay its debts as they become due and greater than the amount
that will be required to pay its probable liability on its existing debts as
they become absolute and matured. Such Guarantor does not intend to
incur, or believe or should have believed that it will incur, debts beyond its
ability to pay such debts as they become due. Such Guarantor, when
viewed on a consolidated basis with the Company and its other Subsidiaries, will
not be rendered insolvent by the execution and delivery of, and performance of
its obligations under, this Guaranty. Such Guarantor does not intend
to hinder, delay or defraud its creditors by or through the execution and
delivery of, or performance of its obligations under, this
Guaranty.
(o) The
obligations of such Guarantor under this Guaranty rank pari passu in right of
payment with all other unsecured Senior Debt (actual or contingent) of such
Guarantor, including, without limitation, all unsecured Senior Debt of such
Guarantor described in Schedule 5.15 to the Note Agreement.
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Section 6.
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Amendments,
Waivers and Consents.
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(a) This
Guaranty may be amended, and the observance of any term hereof may be waived
(either retroactively or prospectively), with (and only with) the written
consent of each Guarantor and the Required Holders, except that (1) no
amendment or waiver of any of the provisions of Sections 3, 4 or 5, or any
defined term (as it is used therein), will be effective as to any Holder unless
consented to by such Holder in writing, and (2) no such amendment or waiver
may, without the written consent of each Holder, (i) change the percentage
of the principal amount of the Notes the Holders of which are required to
consent to any such amendment or waiver, or (ii) amend Section 2 or
this Section 6. No consent of the Holders or the Guarantors
shall be required in connection with the execution and delivery of a Guaranty
Supplement or other addition of any additional Guarantor, and each Guarantor, by
its execution and delivery of this Guaranty (or Guaranty Supplement) consents to
the addition of each additional Guarantor. No consent of the
Guarantors shall be required in connection with the issuance and sale of
Additional Notes, and each Guarantor, by its execution and delivery of this
Guaranty (or Guaranty Supplement) consents to the issuance of Additional Notes
pursuant to the Note Purchase Agreement.
(b) The
Guarantors will provide each Holder (irrespective of the amount of Notes then
owned by it) with sufficient information, sufficiently far in advance of the
date a decision is required, to enable such Holder to make an informed and
considered decision with respect to any proposed amendment, waiver or consent in
respect of any of the provisions hereof. The Guarantors will deliver
executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 6 to each Holder
promptly following the date on which it is executed and delivered by, or
receives the consent or approval of, the requisite Holders. The
Guarantors will deliver executed copies of each executed Guaranty Supplement to
each Holder promptly following the date on which it is executed.
(c) No
Guarantor will directly or indirectly pay or cause to be paid any remuneration,
whether by way of fee or otherwise, or grant any security, to any Holder as
consideration for or as an inducement to the entering into by such Holder of any
waiver or amendment of any of the terms and provisions hereof unless such
remuneration is concurrently paid, or security is concurrently granted, on the
same terms, ratably to each Holder even if such Holder did not consent to such
waiver or amendment.
(d) Any
amendment or waiver consented to as provided in this Section 6 applies
equally to all Holders and is binding upon them and upon each future holder and
upon the Guarantors. No such amendment or waiver will extend to or
affect any obligation, covenant or agreement not expressly amended or waived or
impair any right consequent thereon. No course of dealing between the
Guarantors and any Holder nor any delay in exercising any rights hereunder shall
operate as a waiver of any rights of any Holder. As used herein, the
term “this Guaranty” and references thereto shall mean this Guaranty as it may
from time to time be amended or supplemented.
(e) Solely
for the purpose of determining whether the Holders of the requisite percentage
of the aggregate principal amount of Notes then outstanding approved or
consented to any amendment, waiver or consent to be given under this Guaranty,
Notes directly or indirectly owned by any Guarantor, the Company or any of their
respective subsidiaries or Affiliates shall be deemed not to be
outstanding.
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Section 7.
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Notices.
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All
notices and communications provided for hereunder shall be in writing and sent
(a) by telefacsimile if the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service (charges prepaid), or
(b) by registered or certified mail with return receipt requested (postage
prepaid) or (c) by a recognized overnight delivery service (charges
prepaid). Any such notice must be sent:
(1)if to a 2007-A Note Purchaser or its
nominee, to such 2007-A Note Purchaser or its nominee at the address specified
for such communications in Schedule A to the Note Agreement or at such other
address as such 2007-A Note Purchaser or its nominee shall have specified to any
Guarantor or the Company in writing,
(2)if to an Additional Purchaser or its
nominee, to such Additional Purchaser or its nominee at the address specified
for such communications in Schedule A to the applicable Supplement or at such
other address as such Additional Purchaser or its nominee shall have specified
to any Guarantor or the Company in writing,
(3)if to any other Holder, to such Holder
at such address as such Holder shall have specified to any Guarantor or the
Company in writing, or
(4)if to any Guarantor, to such Guarantor
c/o the Company at its address set forth at the beginning of the Note Agreement
to the attention of Chief Financial Officer, or at such other address as such
Guarantor shall have specified to the Holders in writing.
Notices
under this Section 7 will be deemed given only when actually
received.
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Section 8.
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Miscellaneous;.
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(a) No
remedy herein conferred upon or reserved to any Holder is intended to be
exclusive of any other available remedy or remedies, but each and every such
remedy shall be cumulative and shall be in addition to every other remedy given
under this Guaranty now or hereafter existing at law or in equity. No
delay or omission to exercise any right or power accruing upon any default,
omission or failure of performance hereunder shall impair any such right or
power or shall be construed to be a waiver thereof but any such right or power
may be exercised from time to time and as often as may be deemed
expedient. In order to entitle any Holder to exercise any remedy
reserved to it under the Guaranty, it shall not be necessary for such Holder to
physically produce its Note in any proceedings instituted by it or to give any
notice, other than such notice as may be herein expressly required.
(b) The
Guarantors will pay all sums becoming due under this Guaranty by the method and
at the address specified for such purpose for such Holder, in the case of a
Holder that is a 2007-A Note Purchaser, on Schedule A to the Note Agreement, and
in the case of a Holder that is an Additional Purchaser, on Schedule A to the
corresponding Supplement or by such other method or at such other address as any
Holder shall have from time to time specified to the Guarantors in writing for
such purpose, without the presentation or surrender of this Guaranty or any
Note.
(c) Any
provision of this Guaranty that 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 (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
(d) If
the whole or any part of this Guaranty shall be now or hereafter become
unenforceable against any one or more of the Guarantors for any reason
whatsoever or if it is not executed by any one or more of the Guarantors, this
Guaranty shall nevertheless be and remain fully binding upon and enforceable
against each other Guarantor as if it had been made and delivered only by such
other Guarantors.
(e) This
Guaranty shall be binding upon each Guarantor and its successors and assigns and
shall inure to the benefit of each Holder and its successors and assigns so long
as its Notes remain outstanding and unpaid.
(f) This
Guaranty may be executed in any number of counterparts, each of which shall be
an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.
(g) This
Guaranty shall be construed and enforced in accordance with, and the rights of
the parties shall be governed by, the law of the State of New York excluding
choice-of-law principles of the law of such State that would require the
application of the laws of a jurisdiction other than such State.
In
Witness Whereof, the undersigned has caused this Subsidiary Guaranty Agreement
to be duly executed by an authorized representative as of this 12th day of
December, 2007.
Granite
Construction Company
By
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇
President
By /s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇. Vice President
Granite
Construction Northeast, Inc.
By
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇
President
By /s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇. Vice President
Granite
Land Company
By /s/ ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
President
By
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇. Vice President
Granite
Northwest, Inc.
By /s/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Treasurer
Intermountain
Slurry Seal, Inc.
By /s/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Treasurer
Pozzolan
Products Company (P.P.C.)
By /s/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
President
By /s/ ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Treasurer & Secretary
GILC
Incorporated
By /s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
President
By /s/
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
Chief Financial Officer
Subsidiary Guaranty
Supplement
To the
Holders (as defined in the
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hereinafter
defined Guaranty Agreement)
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Ladies
and Gentlemen:
Whereas,
Granite Construction Incorporated, a corporation organized under the laws of the
State of Delaware (the “Company”), (i) issued (1)
$200,000,000 aggregate principal amount of its 6.11% Series 2007-A Senior Notes
due December 12, 2019 (the “Series 2007-A Notes”)
pursuant to a Note Purchase Agreement dated as of December 12, 2007 (the “Note Agreement”) between the
Company and each of the purchasers named on Schedule A attached to said Note
Purchase Agreement (the “Series 2007-A Note
Purchasers”) for the purposes described in Section 5.14 of the Note
Purchase Agreement [and (2) _______ [insert information regarding any prior
issuances of Additional Notes] and (ii) may, from time to time, issue and sell
one or more additional Series of its unsecured promissory notes under the
provisions of the Note Agreement pursuant to a supplement (a “Supplement”), provided that the aggregate
principal amount of Notes of all Series issued pursuant to all Supplements (the
“Additional Notes,” and
collectively with the Series 2007-A Notes, the “Notes”) in accordance with
the terms of Section 2.2 of the Note Purchase Agreement shall not exceed
$100,000,000. Capitalized terms used herein shall have the meanings
set forth in the hereinafter defined Guaranty Agreement unless herein defined or
the context shall otherwise require.
Whereas,
as a condition precedent to their purchase of the Notes, the Holders required
that from time to time certain subsidiaries of the Company enter into a
Subsidiary Guaranty Agreement dated as of December 12, 2007 as security for the
Notes (as amended, supplemented, restated or otherwise modified from time to
time, the “Subsidiary
Guaranty”).
Pursuant
to Section 9.7 of the Note Agreement, the Company has agreed to cause the
undersigned, ____________, a corporation organized under the laws of
______________ (the “Additional Guarantor”), to
join in the Subsidiary Guaranty. In accordance with the requirements
of the Subsidiary Guaranty, the Additional Guarantor desires to amend the
definition of Guarantor (as the same may have been heretofore amended) set forth
in the Subsidiary Guaranty attached hereto so that at all times from and after
the date hereof, the Additional Guarantor shall be jointly and severally liable
as set forth in the Subsidiary Guaranty for the obligations of the Company under
the Note Agreement (including each Supplement) and the Notes to the extent and
in the manner set forth in the Subsidiary Guaranty.
The
undersigned is the duly elected ____________ of the Additional Guarantor, a
subsidiary of the Company, and is duly authorized to execute and deliver this
Guaranty Supplement to each of you. The execution by the undersigned
of this Guaranty Supplement shall evidence its consent to and acknowledgment and
approval of the terms set forth herein and in the Subsidiary Guaranty and by
such execution the Additional Guarantor shall be deemed to have made in favor of
the Holders the representations and warranties set forth in Section 5 of
the Subsidiary Guaranty.
Upon
execution of this Subsidiary Guaranty Supplement, the Subsidiary Guaranty shall
be deemed to be amended as set forth above. Except as amended herein,
the terms and provisions of the Subsidiary Guaranty are hereby ratified,
confirmed and approved in all respects.
Any and
all notices, requests, certificates and other instruments (including the Notes)
may refer to the Subsidiary Guaranty without making specific reference to this
Subsidiary Guaranty Supplement, but nevertheless all such references shall be
deemed to include this Subsidiary Guaranty Supplement unless the context shall
otherwise require.
Dated: _________________,
20 .
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[Name
of Additional Guarantor]
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By
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Its
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Form
of Accession Agreement
Reference
is hereby made to the Subsidiary Guaranty Agreement dated as of December 12,
2007 (as amended, supplemented, restated or otherwise modified from time to
time, the “Subsidiary
Guaranty”), entered into on a joint and several basis by each of the
undersigned. Capitalized terms used herein and not otherwise defined
shall have the meanings given to such terms in the Subsidiary
Guaranty.
The
undersigned hereby confirm that the Additional Purchasers of the Additional
Notes issued pursuant to the [Number] Supplement dated as of ________, 20__ are
Holders as defined in the Subsidiary Guaranty and as such, are entitled to the
full rights and benefits of Holders under the Subsidiary
Guaranty. The undersigned acknowledge the terms of the Subsidiary
Guaranty and agree to be bound thereby.
Date:
[Guarantors]
By:
Name:
Title: