Exhibit 10.2
GUARANTY
GUARANTY , dated as of September 16, 2005, by the
entities signatory hereto (collectively, the “
Guarantors ” and each a “ Guarantor
”) in favor of (i) Bank of America, N.A., a national banking
association, as administrative agent (hereinafter, in such
capacity, the “ Administrative Agent ”)
for itself and the other lenders from time to time party thereto
(hereinafter, collectively, the “ Lenders ”)
which are or may become parties to a Credit Agreement dated as of
September 16, 2005 (as amended and in effect from time to time, the
“ Credit Agreement ”), among The Stride
Rite Corporation, a Massachusetts corporation (the “
Company ”), the other Borrowers from time to time
party thereto (together with the Company, collectively the “
Borrowers ” and each a “ Borrower
”), the Lenders and the Administrative Agent, and (ii) each
of the Lenders.
WHEREAS , the Borrowers and the Guarantors are members
of a group of related corporations, the success of any one of which
is dependent in part on the success of the other members of such
group;
WHEREAS , each Guarantor expects to receive substantial
direct and indirect benefits from the extensions of credit to the
Borrowers by the Lenders pursuant to the Credit Agreement (which
benefits are hereby acknowledged);
WHEREAS , it is a condition precedent to the
Lenders’ making any loans or otherwise extending credit to
the Borrowers under the Credit Agreement that each Guarantor
execute and deliver to the Administrative Agent, for the benefit of
the Lenders and the Administrative Agent, a guaranty substantially
in the form hereof; and
WHEREAS , each Guarantor wishes to guaranty each
Borrower’s obligations to the Lenders and the Administrative
Agent under or in respect of the Credit Agreement as provided
herein;
NOW, THEREFORE
, the Guarantors hereby agree with
the Lenders and the Administrative Agent as follows:
1. Definitions
. The term “
Obligations ” and all other capitalized terms used
herein without definition shall have the respective meanings
provided therefor in the Credit Agreement.
2. Guaranty of Payment and
Performance . Each
Guarantor hereby guarantees to the Lenders and the Administrative
Agent the full and punctual payment when due (whether at stated
maturity, by required pre-payment, by acceleration or otherwise),
as well as the performance, of all of the Obligations including all
such which would become due but for the operation of the automatic
stay pursuant to §362(a) of the Federal Bankruptcy Code and
the operation of §§502(b) and 506(b) of the Federal
Bankruptcy Code. This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment and
performance of all of the Obligations and not of their
collectibility only and is in no way conditioned upon any
requirement that the Administrative Agent or any Lender first
attempt
to collect any of the Obligations from any
Borrower or resort to any collateral security or other means of
obtaining payment. Should any Borrower default in the payment or
performance of any of the Obligations, the obligations of the
Guarantors hereunder with respect to such Obligations in default
shall, upon demand by the Administrative Agent, become immediately
due and payable to the Administrative Agent, for the benefit of the
Lenders and the Administrative Agent, without demand or notice of
any nature, all of which are expressly waived by each Guarantor.
Payments by the Guarantors hereunder may be required by the
Administrative Agent on any number of occasions. All payments by
the Guarantors hereunder shall be made to the Administrative Agent,
in the manner and at the place of payment specified therefor in the
Credit Agreement, for the account of the Lenders and the
Administrative Agent.
3. Guarantors’ Agreement
to Pay Enforcement Costs, etc. Each Guarantor further agrees, as the principal
obligor and not as a guarantor only, to pay to the Administrative
Agent, on demand, all costs and expenses (including court costs and
legal expenses) incurred or expended by the Administrative Agent or
any Lender in connection with the Obligations, this Guaranty and
the enforcement thereof, together with interest on amounts
recoverable under this §3 from the time when such amounts
become due until payment, whether before or after judgment, at the
rate of interest for overdue principal set forth in the Credit
Agreement, provided that if such interest exceeds the
maximum amount permitted to be paid under applicable law, then such
interest shall be reduced to such maximum permitted
amount.
4. Waivers by Guarantors;
Lender’s Freedom to Act . Each Guarantor agrees that the Obligations will
be paid and performed strictly in accordance with their respective
terms, regardless of any law, regulation or order now or hereafter
in effect in any jurisdiction affecting any of such terms or the
rights of the Administrative Agent or any Lender with respect
thereto. Each Guarantor waives promptness, diligence, presentment,
demand, protest, notice of acceptance, notice of any Obligations
incurred and all other notices of any kind, all defenses which may
be available by virtue of any valuation, stay, moratorium law or
other similar law now or hereafter in effect, any right to require
the marshalling of assets of any Borrower or any other entity or
other person primarily or secondarily liable with respect to any of
the Obligations, and all suretyship defenses generally. Without
limiting the generality of the foregoing, each Guarantor agrees to
the provisions of any instrument evidencing, securing or otherwise
executed in connection with any Obligation and agrees that the
obligations of such Guarantor hereunder shall not be released or
discharged, in whole or in part, or otherwise affected by (i) the
failure of the Administrative Agent or any Lender to assert any
claim or demand or to enforce any right or remedy against any
Borrower or any other entity or other person primarily or
secondarily liable with respect to any of the Obligations; (ii) any
extensions, compromise, refinancing, consolidation or renewals of
any Obligation; (iii) any change in the time, place or manner of
payment of any of the Obligations or any rescissions, waivers,
compromise, refinancing, consolidation or other amendments or
modifications of any of the terms or provisions of the Credit
Agreement, the Notes, the other Loan Documents or any other
agreement evidencing, securing or otherwise executed in connection
with any of the Obligations, (iv) the addition, substitution or
release of any entity or other person primarily or secondarily
liable for any Obligation; (v) the
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adequacy of any rights which the Administrative
Agent or any Lender may have against any collateral security or
other means of obtaining repayment of any of the Obligations; (vi)
the impairment of any collateral securing any of the Obligations,
including without limitation the failure to perfect or preserve any
rights which the Administrative Agent or any Lender might have in
such collateral security or the substitution, exchange, surrender,
release, loss or destruction of any such collateral security; or
(vii) any other act or omission which might in any manner or to any
extent vary the risk of such Guarantor or otherwise operate as a
release or discharge of such Guarantor, all of which may be done
without notice to such Guarantor. To the fullest extent permitted
by law, each Guarantor hereby expressly waives any and all rights
or defenses arising by reason of (A) any “one action”
or “anti-deficiency” law which would otherwise prevent
the Administrative Agent or any Lender from bringing any action,
including any claim for a deficiency, or exercising any other right
or remedy (including any right of set-off), against such Guarantor
before or after the Administrative Agent’s or such
Lender’s commencement or completion of any foreclosure
action, whether judicially, by exercise of power of sale or
otherwise, or (B) any other law which in any other way would
otherwise require any election of remedies by the Administrative
Agent or any Lender.
5. Unenforceability of
Obligations Against Any Borrower . If for any reason any Borrower has no legal
existence or is under no legal obligation to discharge any of the
Obligations, or if any of the Obligations have become irrecoverable
from any Borrower by reason of such Borrower’s insolvency,
bankruptcy or reorganization or by other operation of law or for
any other reason, this Guaranty shall nevertheless be binding on
each Guarantor to the same extent as if such Guarantor at all times
had been the principal obligor on all such Obligations. In the
event that acceleration of the time for payment of any of the
Obligations is stayed upon the insolvency, bankruptcy or
reorganization of any Borrower, or for any other reason, all such
amounts otherwise subject to acceleration under the terms of the
Credit Agreement, the Notes, the other Loan Documents or any other
agreement evidencing, securing or otherwise executed in connection
with any Obligation shall be immediately due and payable by the
Guarantors.
6. Subrogation;
Subordination .
6.1. Waiver of Rights Against the
Borrowers . Until the final payment and performance in full of
all of the Obligations, no Guarantor shall exercise and each
Guarantor hereby waives any rights against each Borrower arising as
a result of payment by such Guarantor hereunder, by way of
subrogation, reimbursement, restitution, contribution or otherwise,
and will not prove any claim in competition with the Administrative
Agent or any Lender in respect of any payment hereunder in any
bankruptcy, insolvency or reorganization case or proceedings of any
nature; no Guarantor will claim any setoff, recoupment or
counterclaim against any Borrower in respect of any liability of
such Guarantor to any Borrower; and each Guarantor waives any
benefit of and any right to par
