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EXHIBIT 4.62
MCK
LOAN NO. T0364
LIMITED RECOURSE CONTINUING GUARANTY
THIS LIMITED RECOURSE CONTINUING GUARANTY (this "Guaranty") is made as
of April 20, 1995, by MERCURY CELLULAR TELEPHONE COMPANY ("MCTC") for the
benefit of the COBANK, ACB ("CoBank").
R E C I T A L S:
WHEREAS, MCTC owns 100% of the capital stock of Mercury Cellular of
Kansas, Inc. (the "Borrower"); and
WHEREAS, CoBank and the Borrower have entered into that certain Loan
Agreement, dated of even date herewith (as the same may be amended,
supplemented, extended or restated from time to time, the "Loan Agreement"),
providing for a loan of up to $17,100,000 (the "Loan"); and
WHEREAS, as an inducement to CoBank to enter into the Loan Agreement and
to make the Loan, MCTC has agreed to pledge all of its stock of the Borrower
pursuant to a Pledge Agreement, dated as of even date herewith, which stock
shall be used as the sole collateral for MCTC's guarantee herein of the
Obligations (as hereinafter defined), provided that CoBank's sole recourse with
respect to the guarantee herein contained is against such stock pursuant to
such Pledge Agreement;
NOW, THEREFORE, in consideration of the foregoing, and intending to be
legally bound hereby, MCTC hereby agrees as follows:
SECTION 1. DEFINITIONS. Capitalized terms used in this Guaranty, unless
otherwise defined herein, shall have the meanings assigned to them in the Loan
Agreement.
SECTION 2. OBLIGATIONS. "Obligations" shall mean (a) the principal,
interest and other amounts becoming due and payable, whether by acceleration or
otherwise, under that certain Promissory Note, dated of even date herewith,
made by the Borrower to the order of CoBank, in the original principal amount
of $17,100,000 (as the same may be amended, extended, renewed or replaced from
time to time, the "Note'); (b) all other payments or performances to be made by
the Borrower under the other Loan Documents to which it is a party; and (c) all
other indebtedness and liabilities of the Borrower to CoBank of every kind and
description whatsoever, whether now existing or hereafter arising, fixed or
contingent, as primary obligor or as guarantor or surety, acquired directly or
by assignment or otherwise, liquidated or unliquidated, regardless of how they
arise or by what agreement or instrument they may be evidenced, including,
without limitation, all loans, advances and
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other extensions of credit and all covenants, agreements, and provisions
contained in all loan and other agreements between the parties.
SECTION 3. LIMITATIONS ON RECOURSE. Notwithstanding any provision of
this Guaranty or of any other Loan Document to the contrary, in any action
brought to enforce any obligation of MCTC with respect to the Obligations, the
judgment or decree shall be enforceable only against the "Pledged Collateral"
in which CoBank has a security interest pursuant to the provisions of the MCTC
Pledge Agreement and against MCTC to the extent of its interest in the Pledged
Collateral (and not against any other assets of MCTC) and MCTC shall not be
liable to CoBank hereunder for the Obligations beyond its interest in the
Pledged Collateral; provided, however, that nothing contained in this Section
shall limit or relieve MCTC from liability for failing to comply with the
terms, covenants, conditions and provisions of this Guaranty or the MCTC Pledge
Agreement or any other agreement to which MCTC is a party, other than for the
payment of the Obligations.
SECTION 4. GUARANTY PROVISIONS.
(A) In consideration of the advances under the Loan made and
to be made by CoBank to the Borrower pursuant to the Loan Agreement and for
other good and valuable consideration, the adequacy, sufficiency and receipt of
which are hereby acknowledged, MCTC hereby absolutely, unconditionally,
directly, irrevocably, completely and immediately guarantees the full and
prompt payment, when due, whether by acceleration or otherwise, and the prompt
performance, of the Obligations; provided, however, that recourse hereunder is
limited as provided in Section 3;
(B) MCTC further agrees to pay to CoBank, upon demand, all
losses and reasonable costs and expenses, including, without limitation,
reasonable attorneys' fees and expenses, that may be incurred by CoBank in
attempting to cause the Obligations to be paid, performed or otherwise
satisfied or in attempting to cause satisfaction of MCTC's liability under this
Guaranty or in attempting to protect or preserve any property, personal or
real, securing the Obligations; provided, however, that recourse hereunder is
limited as provided in Section 3;
(C) MCTC agrees that this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time any payment by
the Borrower or any other person to CoBank on account of the Obligations is
rescinded or must otherwise be returned or restored by CoBank upon the
insolvency or bankruptcy of the Borrower or any other obligor, guarantor,
endorser or surety of the Obligations, all as though such payment had not been
made; provided, however, that recourse hereunder is limited as provided in
Section 3;
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(D) It is the intention of MCTC and CoBank that MCTC's
liability hereunder shall not be in excess of the maximum amount permitted by
applicable federal bankruptcy, state insolvency, or similar laws (collectively,
the "Applicable Laws"). To that end, but only to the extent such liability
would otherwise be subject to avoidance under the Applicable Laws if MCTC is
not 'deemed to have received valuable consideration, fair value or reasonably
equivalent value for its liability hereunder, MCTC's liability hereunder shall
be reduced to that amount which, after giving effect thereto, would not render
MCTC insolvent, or leave MCTC with unreasonably small capital to conduct
business, or cause MCTC to have incurred debts (or intended to have incurred
debts) beyond MCTC's ability to pay such debts as they mature, at the time such
liability is deemed to have been incurred under the Applicable Laws. As used
herein, the terms "insolvent" and "unreasonably small capital" shall be
determined in accordance with the Applicable Laws. This Subsection (D) is
intended solely to preserve the rights of CoBank hereunder to the maximum
extent permitted by the Applicable Laws, and neither MCTC nor any other person
shall have any right or claim under this Subsection (D) that would not
otherwise be available under the Applicable Laws;
(E) MCTC assents to all terms and agreements heretofore or
hereafter made by the Borrower with CoBank;
(F) MCTC hereby consents to the following and agrees, with or
without notice (all notices being hereby waived), that its liability (as
limited in Section 3) will not be affected or impaired by (i) the exchange,
release or surrender of any collateral or any claim against the Borrower or any
other person, or the waiver, release or subordination of any security interest,
in whole or in part; (ii) the waiver or delay in the exercise of any of
CoBank's rights or remedies against the Borrower or any other person; (iii) the
renewal, extension or modification of the terms or amounts of any of the
Obligations, the Loan Documents or any other instrument or agreement evidencing
the same; or (iv) the acceptance by CoBank of other guaranties;
(G) MCTC waives acceptance hereof, notice of acceptance
hereof, and notice of acceleration of and intention to accelerate the
Obligations, and waives presentment, demand, protest, notice of dishonor,
notice of default, notice of nonpayment or protest in relation to any
instrument evidencing any of the Obligations, and any other demands and notices
required by law except as such waiver may be expressly prohibited by law;
(H) This is a limited recourse guaranty (as provided in
Section 3) of payment and performance and not of collection only. The liability
of MCTC under this Guaranty (as limited as provided in Section 3) shall be
absolute, unconditional, direct, irrevocable, complete and immediate and shall
not be contingent upon the pursuit of any
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remedies against the Borrower or any other person, nor against any security or
lien available to CoBank, its successors, successors-in-title, endorsees or
assigns, and shall be joint and several with the liabilities of all other
guarantors of the Obligations. MCTC waives any right to require that an action
be brought against the Borrower or any other person or to require that resort
be had to any security of the Borrower or any other person (provided that all
remedies hereunder are limited as provided in Section 3). In the event of a
default under any of the Loan Documents, CoBank shall have the right to enforce
its rights, powers and remedies under any of the Loan Documents in any order,
and all rights, powers and remedies available to CoBank in such event shall be
nonexclusive and cumulative of all other rights, powers and remedies provided
thereunder or hereunder or by law or in equity. Accordingly, MCTC hereby
authorizes and empowers CoBank upon acceleration of the maturity of the Note or
any other Obligation, at its sole discretion, and without notice to MCTC, to
exercise any right or remedy which CoBank may have under the MCTC Pledge
Agreement or any right or remedy hereinafter granted under the MCTC Pledge
Agreement which CoBank may have as to the Pledged Collateral. MCTC waives any
right to require any action on the part of CoBank to proceed to collect amounts
due under the Note or any other Obligation;
(I) MCTC hereby subordinates any and all indebtedness of the
Borrower now or hereafter owed to MCTC to all Obligations of the Borrower to
CoBank, and agrees with CoBank that, from and after the occurrence of a default
or event of default under any of the Loan Documents, and for so long as such
default or event of default exists, MCTC shall not demand or accept any payment
of principal or interest from the Borrower, shall not claim any offset or other
reduction of MCTC's liability hereunder because of any such indebtedness and
shall not take any action to obtain any of the security for the Obligations;
provided, however, that, if CoBank so requests, such indebtedness shall be
collected, enforced and received by MCTC as trustee for CoBank and be paid over
to CoBank on account of the Obligations of the Borrower to CoBank, but without
reducing or affecting in any manner the liability of MCTC under the other
provisions of this Guaranty;
(J) MCTC hereby authorizes CoBank, without notice to MCTC, to
apply all payments and credits received from the Borrower or any other person
or realized from any security in such manner and in such priority as CoBank in
its sole judgment shall see fit to the Obligations or to any other liabilities
of the Borrower or any other person to CoBank, and MCTC agrees that any such
application shall not in any way affect its liabilities hereunder;
(K) The liability of MCTC under this Guaranty shall not in any
manner be affected by reason of any action taken or not taken by CoBank, which
action or inaction is hereby consented and agreed to by MCTC, nor by the
partial or complete unenforceability or invalidity of any other guaranty or
surety agreement, pledge, assignment, or other security
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for any of the Obligations. No delay in making demand on MCTC for satisfaction
of its liability hereunder shall prejudice CoBank's right to enforce such
satisfaction. All of CoBank's rights and remedies shall be cumulative and any
failure of CoBank to exercise any right hereunder shall not be construed as a
waiver of the right to exercise the same or any other right at any time, and
from time to time, thereafter;
(L) This Guaranty shall be a continuing one and shall be
binding upon MCTC regardless of how long before or after the date hereof the
Obligations are incurred. This Guaranty shall remain in full force and effect
until a written instrument of termination shall be executed and delivered by a
duly authorized officer of CoBank. CoBank will only be obligated to execute
such an instrument of termination if: (i) all Obligations have been paid in
full; (ii) CoBank has no further commitment or obligation to extend credit to
the Borrower; and (iii) any preference period applicable to payments made on or
security given for the Obligations has expired under applicable bankruptcy and
insolvency laws; and
(M) MCTC hereby irrevocably waives any and all rights it may
have to enforce any of CoBank's rights or remedies or participate in any
security now or hereafter held by CoBank, and any and all such other rights of
subrogation, reimbursement, contribution or indemnification against the
Borrower or any other person having any manner of liability for the Borrower's
obligations to CoBank, whether or not arising hereunder, by agreement, at law
or in equity.
SECTION 5. REPRESENTATIONS AND WARRANTIES. MCTC represents and warrants
to CoBank, on and as of the date hereof and on and as of each date on which the
Borrower receives an advance under the Loan Agreement, as follows:
(A) ORGANIZATION; POWERS; ETC. MCTC (i) is duly organized,
validly existing, and in good standing under the laws of its state of
incorporation; (ii) is duly qualified to do business and is in good standing in
each jurisdiction in which the character of its properties or the nature of its
business requires such qualification; (iii) has all requisite corporate and
legal power to own and operate its assets and to carry on its business and to
enter into and perform its obligations under the Loan Documents to which it is
a party; and (iv) has duly and lawfully obtained and maintains all licenses,
certificates, permits, authorizations, approvals, and the like which are
material to the conduct of its business or which may be otherwise required by
law.
(B) DUE AUTHORIZATION; NO VIOLATIONS; ETC. The execution and
delivery by MCTC of; and the performance by MCTC of its obligations under, the
Loan Documents to which it is a party have been duly authorized by all
requisite corporate action on the part of MCTC and its shareholders and do not
and will not (i) violate any provision of any law, rule or regulation, any
judgment, order or ruling of any court or governmental agency, the
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articles of incorporation or bylaws of MCTC, or any agreement, indenture,
mortgage, or other instrument to which MCTC is a party or by which MCTC or any
of its properties are bound, or (ii) be in conflict with, result in a breach
of; or constitute with the giving of notice or lapse of time, or both, a
default under any such agreement, indenture, mortgage, or other instrument.
(C) GOVERNMENTAL APPROVAL. No consent, permission,
authorization, order, or license of any governmental authority is necessary in
connection with the execution, delivery, performance, or enforcement of the
Loan Documents to which MCTC is a party or the creation and perfection of the
liens and security interests granted thereby, except such as have been obtained
and are in full force and effect.
(D) BINDING AGREEMENT. Each of the Loan Documents to which
MCTC is a party is, or when executed and delivered will be, the legal, valid,
and binding obligation of MCTC, enforceable against MCTC in accordance with its
terms, subject only to limitations on enforceability imposed by (i) applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
creditors' rights generally, and (ii) general equitable principles.
(E) COMPLIANCE WITH LAWS. MCTC is in compliance in all
material respects with all Laws, the failure to comply with which could have a
Material Adverse Effect (as hereinafter defined) on MCTC. For purposes of this
Guaranty, the term "Material Adverse Effect" shall mean a material adverse
effect on the condition, financial or otherwise, operations, properties or
business of MCTC or on the ability of MCTC to perform its obligations under the
Loan Documents to which it is a party.
(F) ENVIRONMENTAL COMPLIANCE. Without limiting the provisions
of Subsection (E) above, all property owned or leased by MCTC and all
operations conducted by it are in compliance in all material respects with all
Laws relating to environmental protection, the failure to comply with which
could have a Material Adverse Effect on MCTC.
(G) LITIGATION. There are no pending legal, arbitration, or
governmental actions or proceedings to which MCTC is a party or to which any of
its property is subject which could have a Material Adverse Effect on MCTC, and
to the best of MCTC's knowledge, no such actions or proceedings are threatened
or contemplated.
(H) EMPLOYEE BENEFIT PLANS. To the extent applicable, MCTC is
in compliance in all material respects with the applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder.
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(I) TAXES. MCTC has filed or caused to be filed all federal,
state and local tax returns that are required to be filed, and has paid all
taxes as shown on said returns or on any assessment received by them to the
extent that such taxes have become due, unless such taxes are being contested
by MCTC in good faith and by appropriate proceedings and then only if and to
the extent reserves required by GAAP have been set aside on MCTC's books
therefor.
(J) INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT. MCTC is not an "investment company" as that term is defined in, and is
not otherwise subject to regulation under, the Investment Company Act of 1940,
as amended. MCTC is not a "holding company" as that term is defined in, and is
not otherwise subject to regulation under, the Public Utility Holding Company
Act of 1935, as amended.
(K) STOCK OF SUBSIDIARIES. MCTC has no subsidiary other than
as described on Exhibit A hereto. MCTC is the registered and beneficial owner
of the specified percentage of the shares of issued and outstanding capital
stock of each of the subsidiaries as set forth on Exhibit A hereto, which stock
is owned free and clear of all liens, warrants, options, rights to purchase,
rights of first refusal and other interests of any person, except as set forth
on Exhibit A hereto. The stock of each of such subsidiaries has been duly
authorized and validly issued and is fully paid and non-assessable.
(L) FINANCIAL CONDITION. The liability and obligations of MCTC
incurred or arising under this Guaranty and the other Loan Documents to which
it is a party and of the Borrower incurred or arising under the Loan Agreement,
the Note and the other Loan Documents to which it is a party will benefit
substantially MCTC directly and indirectly, and MCTC's board of directors has
made that determination. MCTC has full and complete access to all of the Loan
Documents and other documents relating to the Obligations, has reviewed them
and is fully aware of the meaning and effect of their contents. MCTC is fully
informed of all circumstances that bear upon the risks of executing this
Guaranty which a diligent inquiry would reveal. MCTC has adequate means to
obtain from the Borrower, on a continuing basis, information concerning the
financial condition of the Borrower and is not depending on CoBank to provide
such information, now or in the future. MCTC agrees that CoBank will have no
obligation to advise or notify MCTC of or provide MCTC with any data or
information.
(M) LICENSES; PERMITS; ETC. MCTC is the valid holder of all
licenses, certificates, permits, authorizations, approvals, and the like which
are material to the conduct of its business or which may be required by law,
including, without limitation, all FCC licenses and permits and all licenses
and permits, if any, required by the Commission, and all such licenses,
certificates, permits, authorizations, approvals, and the like are in full
force and effect.
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SECTION 6. COVENANTS. Unless otherwise agreed to in writing by CoBank,
while this Guaranty remains in effect or any of the Obligations have not been
fully paid or otherwise satisfied, MCTC agrees to cause the Borrower to comply
with the affirmative and negative covenants and agreements contained in
Sections 13 and 14 of the Loan Agreement.
SECTION 7. MISCELLANEOUS.
(A) GOVERNING LAW. Except to the extent governed by applicable
federal law, this Guaranty shall be governed by and construed in accordance
with the laws of the State of Kansas without reference to choice of law
doctrine.
(B) BINDING EFFECT. This Guaranty shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and
assigns, including any holder or owner of the Note or any other Loan Document.
(C) SEVERABILITY. If any one or more of the provisions
contained herein shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Guaranty, but this Guaranty shall
be construed as if such invalid, illegal or unenforceable provision had not
been contained herein.
(D) NON-WAIVER; MODIFICATION; ELECTION OF REMEDIES. The
failure of CoBank to insist, in any one or more instances, upon a strict
performance of any of the terms and conditions of this Guaranty, or to exercise
or fail to exercise any option or right contained herein, shall not be
construed as a waiver or a relinquishment for the future of such right or
option, but the same shall continue and remain in full force and effect.
CoBank's knowledge of the breach of any term or condition hereof shall not be
deemed a waiver of such breach, and no waiver by CoBank of any provision hereof
shall be deemed to have been made, or operate as an estoppel, unless expressed
in writing and signed by CoBank. No enforcement of any remedy shall constitute
an election of remedies.
(E) NOTICES. All notices hereunder shall be made, and shall be
deemed to be duly given if made, in the manner provided for notices under
Section 19 of the Loan Agreement, to the parties at the following addresses (or
such other address for a party as shall be specified by like notice):
If to MCTC, as follows: Mercury Cellular Telephone Company
▇.▇. ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇; cc: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
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If to CoBank, as follows:
CoBank, ACB
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Rural Utility Banking Group
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
(F) REGULATORY APPROVALS. Upon any action by CoBank to
commence the exercise of remedies hereunder or under the Mortgage, the Security
Agreement, the Assignment or the MCTC Pledge Agreement, MCTC hereby undertakes
and agrees on behalf of itself and of the Borrower to cooperate and join with
CoBank in any application to the Commission, the FCC, or any other regulatory
body, administrative agency, court or other forum (any such entity, a
"Governmental Authority") with respect thereto and to provide such assistance
in connection therewith as CoBank may request, including, without limitation,
the preparation of filings and appearances of officers and employees of MCTC or
the Borrower before such Governmental Authority, in each case in support of any
such application made by CoBank, and neither MCTC nor the Borrower shall,
directly or indirectly, oppose any such action by CoBank before any such
Governmental Authority.
SECTION 8. CONSENT TO JURISDICTION; REGISTERED AGENT. To the maximum
extent permitted by law, MCTC agrees that any legal action or proceeding with
respect to this Guaranty or any of the other Loan Documents may be brought in
the courts of the State of Kansas or Louisiana or of the United States of
America for the District of Kansas or the Western District of Louisiana, all as
CoBank may elect. By execution of this Guaranty, MCTC hereby irrevocably
submits to such jurisdiction, expressly waiving any objection it may have to
the laying of venue by reason of its present or future domicile. Nothing
contained herein shall affect the right of CoBank to commence legal proceedings
or otherwise proceed against MCTC in any other jurisdiction or to serve process
in any manner permitted or required by law.
[Signatures on next page]
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IN WITNESS WHEREOF, MCTC has caused this Guaranty to be executed and
attested under seal and delivered, by its duly authorized officers, as of the
date first shown above.
MERCURY CELLULAR TELEPHONE
COMPANY
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: President
Attest: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
[CORPORATE SEAL]
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EXHIBIT A
SECTION 5(M): STOCK OF SUBSIDIARIES
================================================================================
PERCENT OF SUBSIDIARY
SUBSIDIARY OWNED BY MCTC SHARES OUTSTANDING LIENS
--------------------------------------------------------------------------------
Mercury Cellular of Kansas,
Inc. 100% 10 None
================================================================================