EXHIBIT 4
LIMITED RECOURSE GUARANTY
THIS LIMITED RECOURSE GUARANTY ("Guaranty") is made and
entered into as of the 29th day of August, 1997 by WELLGATE INTERNATIONAL
LTD., a British Virgin Islands corporation ("Guarantor"), in favor of DEERE
PARK EQUITIES, L.L.C., an Illinois limited liability company ("Deere Park").
RECITALS
WHEREAS, Deere Park has agreed to lend to certain management
stockholders of Dominion Bridge Corporation, a Delaware corporation ("DBC"),
the sum of $4,760,000 (the "Loan"), to fund the exercise of stock options in
DBC pursuant to the terms and conditions of that certain letter agreement
dated August 19, 1997 (as amended, the "Letter Agreement") among Deere Park
and certain of such management stockholders; and
WHEREAS, the management stockholders have caused the shares
issuable upon exercise of such stock options (the "Option Shares") to be
contributed to the Guarantor, and the Guarantor in turn has contributed such
shares to Dominion Park, L.L.C., a newly-organized Delaware limited liability
company of which Guarantor and Deere Park are the members; and
WHEREAS, in consideration of the contribution of the Option
Shares to Dominion Park, Dominion Park has agreed to assume the obligation of
the management stockholders to repay the Loan and, to evidence such
obligation, has issued Deere Park a Secured Promissory Note of even date
herewith in the principal amount of $4,760,000 (the "Note") and, as primary
security for repayment of the Note, has entered into a Stock Pledge and
Security Agreement of even date herewith (the "Dominion Park Stock Pledge"),
pursuant to which Dominion Park has pledged the Option Shares, as well as
other shares of DBC contributed to Dominion Park by Deere Park (the "Deere
Park Shares"); and
WHEREAS, to provide for additional security for repayment of
the Loan, the Letter Agreement requires the Guarantor enter into this
Guaranty and a separate Stock Pledge and Security Agreement of even date
herewith (the "Guarantor Stock Pledge") pursuant to which Guarantor will
pledge to Dominion Park 500,000 additional shares of DBC Common Stock owned
by Guarantor and not contributed to Dominion Park (the "Pledged Shares"); and
WHEREAS, but for this Guaranty, Deere Park is unwilling to
consummate the transactions contemplated by the Letter Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of and as an inducement to
Deere Park to consummate the transactions contemplated by the Letter
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor hereby agrees as
follows:
1. LIMITED RECOURSE GUARANTY. Guarantor unconditionally,
absolutely and irrevocably guarantees to Deere Park the repayment of the
Note; provided, however, that Deere Park's sole recourse shall be to exercise
its rights with respect to the Pledged Shares under the Guarantor Stock
Pledge, and Deere Park shall have no recourse to any other assets of
Guarantor or any of the stockholders, officers, directors or agents of
Guarantor.
2. EXERCISE OF RIGHTS UNDER STOCK PLEDGE AGREEMENT.
Anything in the Guarantor Stock Pledge to the contrary notwithstanding, Deere
Park may not exercise any of its rights under the Guarantor Stock Pledge
unless Deere Park has exercised its rights with respect to the Option Shares
(but not the Deere Park Shares) and the Option Shares and the proceeds
thereof are insufficient to provide for payment in full of the Note. It is
understood that Deere Park shall have no obligation under the Dominion Park
Stock Pledge to exercise any rights with respect to the Deere Park Shares
unless the Option Shares and the Pledged Shares, or the proceeds thereof, are
insufficient to provide for payment in full of the Note.
3. REINSTATEMENT OF GUARANTY. Guarantor agrees that if at
any time all or any part of any amount theretofore received from Dominion
Park or Guarantor and applied by Deere Park toward payment of the Note is or
must be rescinded or returned by Deere Park for any reason whatsoever
(including, without limitation, by reason of the insolvency, bankruptcy or
reorganization of Dominion Park or Guarantor), Guarantor's obligations under
this Guaranty, to the extent that such payment is or must be rescinded or
returned, shall be deemed to have continued in existence, notwithstanding
such previous application by Deere Park, and this Guaranty and the
obligations hereunder shall continue to be effective or be reinstated, as the
case may be, as to such payment, all as though such previous payment to and
application by Deere Park had not been made.
4. GUARANTY NOT IMPAIRED BY OTHER ACTIONS. Guarantor
further agrees that the Obligations shall in no way be impaired, affected,
diminished or released by any renewals or extensions which may be made from
time to time, with its knowledge and written consent, of the time of payment
of the Note, or by any forbearance or delay in enforcing the payment thereof,
or by the acceptance by Deere Park of additional security. Subject to the
provisions of Section 2, Deere Park, at its election, may exercise its rights
with respect to the Pledged Shares with or without (a) joining Dominion Park
in any such action; or (b) commencing any action against or obtaining any
judgment against Dominion Park; or (c) enforcing, at its option, any other
remedy under the Note; and Deere Park shall have the right and option to
obtain a judgment directly against Guarantor and enforce said judgment
against the Pledged Shares.
5. ASSIGNMENT AND TRANSFER. Deere Park may, at any time or
from time to time, with Guarantor's written consent, assign or transfer all
or any portion of the Note; and, notwithstanding any such assignment or
transfer or any subsequent assignment or transfer thereof, Guarantor's
obligations hereunder shall remain in full force and effect for the purposes
of this Guaranty, and each and every immediate and successive assignee or
transferee of any of the Note or any interest therein shall, to the extent of
the interest of such assignee or transferee in the Note, be entitled to the
benefits of this Guaranty to the same extent as if such assignee or
transferee were Deere Park.
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6. NO WAIVER OF RIGHTS. No delay on the part of Deere Park
in the exercise of any right or remedy shall operate as a waiver thereof, and
no single or partial exercise by Deere Park of any right or remedy shall
preclude other or further exercise thereof or the exercise of any other right
or remedy; nor shall any modification or waiver of any of the provisions of
this Guaranty be binding upon Deere Park, except as expressly set forth in a
writing duly signed and delivered on behalf of Deere Park. No action of
Deere Park permitted hereunder shall in any way affect or impair the rights
of Deere Park under this Guaranty.
7. REPRESENTATION AND WARRANTY. Guarantor further
represents and warrants that it has the corporate power and authority, and
has all corporate action necessary, to execute and deliver, and perform its
obligations under, this Guaranty and the Guarantor Stock Pledge. Guarantor
further represents and warrants that Guarantor has good and marketable title
to the Pledged Shares, subject to no liens, claims or encumbrances whatsoever
other than those created by the Guarantor Stock Pledge.
8. TERM. This Guaranty shall remain in full force and effect
until the Note has been paid in full or Deere Park has terminated this
Guaranty.
9. SUCCESSORS AND ASSIGNS. This Guaranty shall be binding
upon and enforceable against Guarantor and its successors and assigns.
10. GOVERNING LAW; CONSENT TO JURISDICTION. This Guaranty
shall be construed in accordance with and governed by the internal laws of
the State of Illinois, without regard to conflict of law principles. Any
litigation or arbitration between the parties which arises out of this Note
shall be instituted and prosecuted only in the appropriate state or federal
court or other tribunal situated in the State of Illinois. Guarantor hereby
submits to the exclusive jurisdiction of such courts and tribunals for
purposes of any such action and the enforcement of any judgment or order
arising therefrom. GUARANTOR HEREBY WAIVES ANY RIGHT TO A CHANGE OF VENUE AND
ANY AND ALL OBJECTIONS TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS
AND OTHER TRIBUNALS LOCATED IN THE STATE OF ILLINOIS.
11. CONSTRUCTION. When the context or construction of the
terms of this Guaranty so require, all words used in the singular herein
shall be deemed to have been used in the plural and the neuter shall include
the masculine and feminine. The captions and headings of this Guaranty are
not intended to define or limit in any way the scope or intent of the
provisions of this Guaranty.
12. TIME OF ESSENCE. Time is of the essence of this Guaranty
with respect to the performance by Dominion Park of its obligations under the
Note and Guarantor's performance of its obligations hereunder and under the
Guarantor Stock Pledge.
13. SEVERABILITY. Each provision of this Guaranty shall be
interpreted in such manner as to be effective, valid and enforceable under
applicable law, but if any provision of this Guaranty shall be prohibited by
or invalid under such law, such provision shall be deemed severable and
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ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Guaranty.
IN WITNESS WHEREOF, this Guaranty has been executed and
delivered as of the date first above written.
WELLGATE INTERNATIONAL LTD.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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Its: Member
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