GUARANTEE
(FIDELITY LEASING, INC.)
This Guarantee, dated as of February 4, 1999, is made FIDELITY
LEASING, INC., a Pennsylvania corporation (the "Guarantor"), in favor of FIRST
UNION CAPITAL MARKETS CORP., a North Carolina corporation, as Deal Agent (in
such capacity, the "Agent") for VARIABLE FUNDING CAPITAL CORPORATION, a Delaware
corporation, as Lender (together with any additional Lenders, the "Lenders"),
parties to the Receivables Credit Agreement referred to below.
RECITALS
A. WHEREAS, pursuant to that certain Purchase and Sale
Agreement, dated as of February 4, 1999, by and among Fidelity Leasing SPE III,
LLC, as the Buyer (the "Buyer"), the Guarantor, as the Servicer, and JLA Credit
Corporation, as the Originator (the "Originator"), the Buyer agreed to purchase
from the Originator, and the Originator agreed to sell to the Buyer, certain
Purchased Assets defined therein;
B. WHEREAS, pursuant to that certain Receivables Credit
Agreement, dated as of February 4, 1999, by and among the Buyer, as the
Borrower, the Guarantor, as the Servicer, the Investors named therein, the
Lenders, the Agent, First Union National Bank, as the Liquidity Agent, and
▇▇▇▇▇▇ Trust and Savings Bank, as the Collateral Custodian and the Backup
Servicer, the Lenders have agreed to make a Loan to the Buyer upon the terms and
conditions set forth therein;
C. WHEREAS, pursuant to Section 9.5 of the Purchase and Sale
Agreement, the Buyer assigned all of its right, title and interest in the
Purchase and Sale Agreement, including all of its rights to enforce any and all
of the provisions thereof, to the Agent; and
D. WHEREAS, it is a condition precedent to the obligation of
the Lenders to make their Loan to the Buyer pursuant to the Receivables Credit
Agreement that the Guarantor shall have executed and delivered this Guarantee to
the Agent for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce
the Agent and the Lenders to enter into the Receivables Credit Agreement and to
induce the Lenders to make the Loan to the Borrower under the Receivables Credit
Agreement, the Guarantor hereby agrees with the Agent, for the ratable benefit
of the Lenders, as follows:
1. Defined Terms. (a) Unless otherwise defined herein, terms defined in the
Receivables Credit Agreement and used herein shall have the meanings given to
them in the Receivables Credit Agreement.
(b) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Guarantee shall refer to this Guarantee as a whole and
not to any particular provision of this Guarantee, and section and paragraph
references are to this Guarantee unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. Guarantee. (a) The Guarantor hereby, unconditionally and
irrevocably, guarantees to the Agent, for the ratable benefit of the Lenders and
their respective successors, indorsees, transferees and assigns, the prompt and
complete payment and performance by the Originator when due (whether at the
stated maturity, by acceleration or otherwise) of the obligations of the
Originator arising from (i) any breach of any representation, warranty, covenant
or agreement (including, without limitation, any Warranty Event) and (ii) any
amounts payable by the Originator in connection with any indemnification
provision set forth in the Purchase and Sale Agreement (all such obligations in
clause (i) and (ii) of this sentence, the "Obligations"). The parties hereto
agree that the provisions of this Guarantee shall not be interpreted to provide
recourse to the Guarantor against loss by reason of the bankruptcy or insolvency
(or other credit condition) of, or default by, a related Obligor on any Asset.
(b) The Guarantor further agrees to pay any and all expenses
(including, without limitation, all fees and disbursements of counsel) which may
be paid or incurred by the Agent or any Lender in enforcing, or obtaining advice
of counsel in respect of, any rights with respect to, or collecting, any or all
of the Obligations and/or enforcing any rights with respect to, or collecting
against, the Guarantor under this Guarantee.
(c) The Guarantor agrees that the Obligations may at any time and from
time to time exceed the amount of the liability of such Guarantor hereunder
without impairing this Guarantee or affecting the rights and remedies of the
Agent or any Lender hereunder.
(d) No payment or payments made by the Borrower, the Guarantor, any
other guarantor or any other Person or received or collected by the Agent or any
Lender from the Borrower, the Guarantor, any other guarantor or any other Person
by virtue of any action or proceeding or any set-off or appropriation or
application at any time or from time to time in reduction of or in payment of
the Obligations shall be deemed to modify, reduce, release or otherwise affect
the liability of the Guarantor hereunder which shall, notwithstanding any such
payment or payments other than payments made by the Guarantor in respect of the
Obligations or payments received or collected from the Guarantor in respect of
the Obligations, remain liable for the Obligations up to the maximum liability
of the Guarantor hereunder until the Obligations are paid in full and the
Commitments are terminated.
(e) The Guarantor agrees that whenever, at any time, or from time to
time, it shall make any payment to the Agent or any Lender on account of its
liability hereunder, it will notify the Agent in writing that such payment is
made under this Guarantee for such purpose.
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3. Right of Set-off. The Guarantor hereby irrevocably authorizes each
Lender at any time and from time to time without notice to the Guarantor, any
such notice being expressly waived by the Guarantor, to set-off and appropriate
and apply any and all deposits (general or special, time or demand, provisional
or final), in any currency, and any other credits, indebtedness or claims, in
any currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender to or for the
credit or the account of the Guarantor, or any part thereof in such amounts as
such Lenders may elect, against and on account of the obligations and
liabilities of the Guarantor to such Lender hereunder and claims of every nature
and description of such Lender against the Guarantor, in any currency, whether
arising hereunder, under the Purchase and Sale Agreement, any of the Transaction
Documents or otherwise, as such Lender may elect, whether or not the Agent or
any Lender has made any demand for payment and although such obligations,
liabilities and claims may be contingent or unmatured. The Agent and each Lender
shall notify the Guarantor promptly of any such set-off and the application made
by the Agent or such Lender, provided that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of the Agent
and each Lender under this Section are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Agent or such
Lender may have.
4. No Subrogation. Notwithstanding any payment or payments made by the
Guarantor hereunder or any set-off or application of funds of the Guarantor by
any Lender, the Guarantor shall not be entitled to be subrogated to any of the
rights of the Agent or any Lender against the Borrower or any other guarantor or
any collateral security or guarantee or right of offset held by any Lender for
the payment of the Obligations, nor shall the Guarantor seek or be entitled to
seek any contribution or reimbursement from the Borrower or any other guarantor
in respect of payments made by the Guarantor hereunder, until all amounts owing
to the Agent and the Lenders by the Borrower on account of the Obligations are
paid in full and the Commitments are terminated. If any amount shall be paid to
the Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by the
Guarantor in trust for the Agent and the Lenders, segregated from other funds of
the Guarantor, and shall, forthwith upon receipt by the Guarantor, be turned
over to the Agent in the exact form received by the Guarantor (duly indorsed by
the Guarantor to the Agent, if required), to be applied against the Obligations,
whether matured or unmatured, in such order as the Agent and the Lenders may
determine.
5. Amendments, etc. with respect to the Obligations; Waiver of Rights.
The Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against the Guarantor and without notice to or further
assent by the Guarantor, any demand for payment of any of the Obligations made
by the Agent or any Lender may be rescinded by such party and any of the
Obligations continued, and the Obligations, or the liability of any other party
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Agent or any Lender, and the Purchase and Sale
Agreement, and any other Transaction Documents executed and delivered in
connection therewith may be amended,
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modified, supplemented or terminated, in whole or in part, as the Agent may deem
advisable from time to time, and any collateral security, guarantee or right of
offset at any time held by the Agent or any Lender for the payment of the
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Agent nor any Lender shall have any obligation to protect, secure, perfect or
insure any Lien at any time held by it as security for the Obligations or for
this Guarantee or any property subject thereto. When making any demand hereunder
against the Guarantor, the Agent or any Lender may, but shall be under no
obligation to, make a similar demand on the Borrower or any other guarantor, and
any failure by the Agent or any Lender to make any such demand or to collect any
payments from the Borrower or any such other guarantor or any release of the
Borrower or such other guarantor shall not relieve the Guarantor of its
obligations or liabilities hereunder, and shall not impair or affect the rights
and remedies, express or implied, or as a matter of law, of the Agent or any
Lender against the Guarantor. For the purposes hereof "demand" shall include the
commencement and continuance of any legal proceedings.
6. Guarantee Absolute and Unconditional. The Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Agent or any Lender upon
this Guarantee or acceptance of this Guarantee, the Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon this Guarantee; and
all dealings between the Borrower and the Guarantor, on the one hand, and the
Agent and the Lenders, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon this Guarantee. The
Guarantor waives diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon the Borrower or the Guarantor with respect
to the Obligations. The Guarantor understands and agrees that this Guarantee
shall be construed as a continuing, absolute and unconditional guarantee of
payment without regard to (a) the validity, regularity or enforceability of the
Purchase and Sale Agreement, any of the other Transaction Documents, any of the
Obligations or any other collateral security therefor or guarantee or right of
offset with respect thereto at any time or from time to time held by the Agent
or any Lender, (b) any defense, set-off or counterclaim (other than a defense of
payment of performance) which may at any time be available to or be asserted by
the Borrower against the Agent or any Lender, or (c) any other circumstance
whatsoever (with or without notice to or knowledge of the Borrower or the
Guarantor) which constitutes, or might be construed to constitute, an equitable
or legal discharge of the Borrower for the Obligations, or of the Guarantor
under this Guarantee, in bankruptcy or in any other instance. When pursuing its
rights and remedies hereunder against the Guarantor, the Agent and any Lender
may, but shall be under no obligation to, pursue such rights and remedies as it
may have against the Borrower or any other Person or against any collateral
security or guarantee for the Obligations or any right of offset with respect
thereto, and any failure by the Agent or any Lender to pursue such other rights
or remedies or to collect any payments from the Borrower or any such other
Person or to realize upon any such collateral security or guarantee or to
exercise any such right of offset, or any release of the Borrower or any such
other Person or any such collateral security, guarantee or right of offset,
shall not relieve the Guarantor of any liability hereunder, and shall not impair
or affect the rights and remedies, whether express, implied or available as a
matter of law, of the Agent and
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the Lenders against the Guarantor. This Guarantee shall remain in full force and
effect and be binding in accordance with and to the extent of its terms upon the
Guarantor and the successors and assigns thereof, and shall inure to be benefit
of the Agent and the Lenders, and their respective successors, indorsees,
transferees and assigns, until all the Obligations and the obligations of the
Guarantor under this Guarantee shall have been satisfied by payment in full and
the Commitments shall be terminated.
7. Reinstatement. This Guarantee shall continue to be effective, or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any of the Obligations is rescinded or must otherwise be restored or returned by
the Agent or any Lender upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of the Borrower or the Guarantor, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or the Guarantor or any substantial
part of its property, or otherwise, all as though such payments had not been
made.
8. Payments. The Guarantor hereby guarantees that payments hereunder
will be paid to the Agent without set-off or counterclaim in U.S. Dollars at the
office of the Agent specified in the Receivables Credit Agreement.
9. Representations and Warranties. The Guarantor hereby represents and
warrants that:
(a) it is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization and has the corporate power and
authority and the legal right to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged;
(b) it has the corporate power and authority and the legal right to
execute and deliver, and to perform its obligations under, this Guarantee and
any other Transaction Documents to which it is a party, and has taken all
necessary corporate action to authorize its execution, delivery and performance
of this Guarantee and any other Transaction Documents to which it is a party;
(c) this Guarantee and each of the other Transaction Documents to which
the Guarantor is a party has been duly executed and delivered on behalf of the
Guarantor, and constitutes a legal, valid and binding obligation of the
Guarantor enforceable in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered on a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing;
(d) the execution, delivery and performance of this Guarantee and any
other Transaction Documents to which the Guarantor is a party will not violate
any provision of any Requirement of Law or contractual obligation of the
Guarantor and will not result in or require the creation or imposition of any
Lien on any of the properties or revenues of the Guarantor pursuant to any
Requirement of Law or contractual obligation of the Guarantor;
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(e) no consent or authorization of, filing with, notice to, or other
act by or in respect of, any Governmental Authority or any other Person
(including, without limitation, any stockholder or creditor of the Guarantor) is
required in connection with the execution, delivery, performance, validity or
enforceability of this Guarantee or any other Transaction Documents to which the
Guarantor is a party;
(f) no litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of the
Guarantor, threatened by or against the Guarantor or against any of its
properties or revenues (i) with respect to this Guarantee or any other
Transaction Document to which the Guarantor is a party or any of the
transactions contemplated hereby or thereby, or (ii) which has any reasonable
likelihood of having a material adverse effect on the business, operations,
property or financial or other condition of the Guarantor;
(g) it has good record and marketable title in fee simple to, or a
valid leasehold interest in, all its real property that it purports to own, and
good title to, or a valid leasehold interest in, all its other property, and
none of such property is subject to any Lien of any nature whatsoever;
(h) it has filed or caused to be filed all tax returns which, to its
knowledge, are required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any the amount or validity of
which are currently being contested in good faith by appropriate proceedings and
with respect to which reserves in conformity with GAAP have been provided on the
books of the Guarantor); no tax Lien has been filed, and, to the knowledge of
the Guarantor, no claim is being asserted, with respect to any such tax, fee or
other charge; and
(i) the balance sheets of the Guarantor as of September 30, 1997 and
September 30, 1998, and the related statements of income and of cash flows for
the fiscal years ended on each such date, reported on by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
copies of which have heretofore been furnished to each Lender, are complete and
correct and present fairly the financial condition of the Guarantor as at such
dates, and the results of its operations and its cash flow for the fiscal years
then ended. The unaudited balance sheet of the Guarantor as of December 31, 1998
and the related unaudited statements of income and of cash flows for the
three-month period ended on such date, certified by a Responsible Officer,
copies of which have heretofore been furnished to each Lender, are complete and
correct and present fairly the financial condition of the Guarantor as at such
date, and the results of its operations and its cash flows for the three-month
period then ended (subject to normal year-end audit adjustments). All such
financial statements, including the related schedules and notes thereto, have
been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by such accountants or Responsible Officer,
as the case may be, and as disclosed therein). At the date of the most recent
balance sheet referred to above, the Guarantor had no material guarantee
obligation, contingent liability or liability for taxes, or any long-term lease
or unusual forward or long-term commitment, including, without limitation, any
interest rate
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or foreign currency swap or exchange transaction or other financial derivative,
which is not reflected in the foregoing statements or in the notes thereto.
During the period from December 31, 1998, to and including the date hereof there
has been no sale, transfer or other disposition by the Guarantor of any material
party of its business or property and no purchase or other acquisition of any
business or property (including any capital stock of any other Person) material
in relation to the financial condition of the Guarantor as of the date hereof.
10. Authority of Agent. The Guarantor acknowledges that the rights and
responsibilities of the Agent under this Guarantee with respect to any action
taken by the Agent or the exercise or non-exercise by the Agent of any option,
right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this guarantee shall, as between the Agent and the
Lenders, be governed by the Receivables Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Agent and the Guarantor, the Agent shall be conclusively presumed
to be acting as agent for the Lenders with full and valid authority so to act or
refrain from acting, and the Guarantor shall not be under any obligation, or
entitlement, to make any inquiry respecting such authority.
11. Notices. All notices, requests and demands to or upon the Agent,
any Lender or the Guarantor to be effective shall be in writing (or by telex,
fax or similar electronic transfer confirmed in writing) and shall be deemed to
have been duly given or made (1) when delivered by hand or (2) if given by mail,
when deposited in the mails by certified mail, return receipt requested, or (3)
if by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed as follows:
(a) if to the Agent or any Lender, at its address or transmission
number for notices provided in the Receivables Credit Agreement; and
(b) if to the Guarantor, at its address or transmission number for
notices set forth under its signature below.
The Agent, each Lender and the Guarantor may change its address and
transmission numbers for notices by notice in the manner provided in this
Section.
12. Severability. Any provision of this Guarantee 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.
13. Integration. This Guarantee represents the agreement of the
Guarantor with respect to the subject matter hereof and there are no promises or
representations by the Agent or any Lender relative to the subject matter hereof
not reflected herein.
14. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of
the terms or provisions of this Guarantee may be waived, amended, supplemented
or otherwise
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modified except by a written instrument executed by the Guarantor
and the Agent, provided that any provision of this Guarantee may be waived by
the Agent and the Lenders in a letter or agreement executed by the Agent or by
telex or facsimile transmission from the Agent.
(b) Neither the Agent nor any Lender shall by any act (except by a
written instrument pursuant to Section 14(a) hereof), delay, indulgence,
omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any default or Event of Default or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by the Agent or any Lender of any right or remedy hereunder on any one
occasion shall not be construed as a bar to any right or remedy which the Agent
or such Lender would otherwise have on any future occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
15. Section Headings. The section headings used in this Guarantee are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.
16. Successors and Assigns. This Guarantee shall be binding upon the
successors and assigns of the Guarantor and shall inure to the benefit of the
Agent and the Lenders and their successors and assigns.
17. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
18. Submission To Jurisdiction; Waivers. The Guarantor hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Guarantee and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
(c) agrees that service of process in any such action or proceeding may
be effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of
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mail), postage prepaid, to the Guarantor at its address set forth under its
signature below or at such other address of which the Agent shall have been
notified pursuant hereto;
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right to ▇▇▇
in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to in
this Section any special, exemplary, punitive or consequential damages.
19. Acknowledgments. The Guarantor hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Guarantee and any other Transaction Documents to which it is a
party;
(b) neither the Agent nor any Lender has any fiduciary relationship
with or duty to the Guarantor arising out of or in connection with this
Guarantee or any of the other Transaction Documents to which it is a party, and
the relationship between the Guarantor, the Borrower and the other loan parties,
on one hand, and Agent and Lenders, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Transaction
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Lenders or among the Guarantor, the Borrower, any of the other loan
parties and the Lenders.
20. WAIVER OF JURY TRIAL. THE GUARANTOR HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS GUARANTEE OR ANY OTHER TRANSACTION DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.
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IN WITNESS WHEREOF, the undersigned has caused this Guarantee to be
duly executed and delivered by its duly authorized officer as of the day and
year first above written.
FIDELITY LEASING, INC.,
a Pennsylvania corporation
By: ______________________________
Name: ______________________________
Title: ______________________________
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇