Conformed
SUBSIDIARY
GUARANTY
SUBSIDIARY GUARANTY dated as
of March 23, 2007 (this “Guaranty”) made by each
of the Persons that is a signatory hereto (individually a
“Guarantor” and collectively, the
“Guarantors”) in favor of JPMorgan Chase Bank, National
Association, in its capacity as administrative agent (the
“Administrative Agent”) under the Credit Agreement
referred to below for the benefit of the Administrative Agent, the
Collateral Agent, the Lenders and their Affiliates to the extent
provided below.
WITNESSETH:
WHEREAS, Darwin Professional
Underwriters, Inc., a Delaware corporation (the
“Borrower”), the Administrative Agent and certain other
financial institutions are contemporaneously herewith entering into
a credit agreement dated as of the date hereof (as same may be
amended or modified from time to time, the “Credit
Agreement”), providing, subject to the terms and conditions
thereof, for extensions of credit to be made by the Lenders (as
defined therein) to the Borrower. Capitalized terms used but not
otherwise defined herein shall have the meaning ascribed to them by
the Credit Agreement;
WHEREAS, it is a condition
precedent to the extension of credit by the Lenders under the
Credit Agreement that each of the Guarantors execute and deliver
this Guaranty whereby each of the Guarantors shall guarantee the
payment when due of all Liabilities (as defined below); and
WHEREAS, in consideration of
the financial and other support that the Borrower has provided, and
such financial and other support as the Borrower may in the future
provide, to the Guarantors, and in order to (a) induce the
Lenders and the Administrative Agent to enter into the Credit
Agreement and extend credit thereunder and (b) induce the
Lenders and their Affiliates to enter into one or more Swap
Agreements permitted by the Credit Agreement (such agreements, as
from time to time amended, supplemented or otherwise modified,
being the “Covered Swap Agreements”) and because each
Guarantor has determined that executing this Guaranty is in its
interest and to its financial benefit, each of the Guarantors is
willing to guarantee the obligations of the Borrower under the
Credit Agreement, any Note, the other Credit Documents and the
Covered Swap Agreements (all of the foregoing agreements or
arrangements being the “Facilities” and any writing
evidencing, supporting or securing a Facility, including but not
limited to this Guaranty, as such writing may be amended,
supplemented or otherwise modified from time to time, being a
“Facility Document”).
NOW THEREFORE, in order to
induce the Guaranteed Parties (as defined below) to enter into or
extend or continue credit or give financial accommodation under the
Facilities, each Guarantor agrees as follows:
1. Guaranty of
Payment . Each Guarantor unconditionally and irrevocably
guarantees to each of the Administrative Agent, the Collateral
Agent, the Lenders and each of their Affiliates party to a Covered
Swap Agreement (individually a “Guaranteed Party” and
collectively, the “Guaranteed Parties”) the punctual
payment of all sums now owing or which may in the future be owing
by the Borrower under the Facility Documents, when the same are due
and payable, whether on demand, at stated maturity, by acceleration
or otherwise, and whether for principal, interest, fees, expenses,
indemnification or otherwise (all of the foregoing sums being the
“ Liabilities ”). Upon failure by the Borrower
to pay punctually any Liability, each of the Guarantors agrees that
it shall forthwith on demand pay to the Administrative Agent for
the benefit of the Guaranteed Parties (or in the case of amounts
owing under a Covered Swap Agreement, to the applicable Guaranteed
Party) the amount not so paid at the place and in the manner
specified in the applicable Facility Document. The Liabilities
include, without limitation, interest accruing after the
commencement of a proceeding under bankruptcy, insolvency or
similar laws of any jurisdiction at the rate or rates provided in
the Facility Documents. This Guaranty is a guaranty of payment and
not of collection only. The Guaranteed Parties shall not be
required to exhaust any right or remedy or take any action against
the Borrower or any other person or entity or any collateral. Each
Guarantor agrees that, as between such Guarantor and the Guaranteed
Parties, the Liabilities may be declared to be due and payable for
the purposes of this Guaranty notwithstanding any stay, injunction
or other prohibition which may prevent, delay or vitiate any
declaration as regards the Borrower and that in the event of a
declaration or attempted declaration, the Liabilities shall
immediately become due and payable by such Guarantor for the
purposes of this Guaranty. All liabilities of the Guarantors
hereunder shall be the joint and several liabilities of each
Guarantor.
2. Guaranty Absolute
. Each Guarantor guarantees that the Liabilities shall be paid
strictly in accordance with the terms of the Facility Documents.
The liability of a Guarantor under this Guaranty is absolute and
unconditional irrespective of: (a) any change in the time,
manner or place of payment of, or in any other term of, all or any
of the Facility Documents or Liabilities, or any other amendment or
waiver of or any consent to departure from any of the terms of any
Facility Document or Liability, including any increase or decrease
in the rate of interest thereon; (b) any release or amendment
or waiver of, or consent to departure from, any other guaranty or
support document, or any exchange, release or non perfection of any
collateral, for all or any of the Facility Documents or
Liabilities; (c) any present or future law, regulation or
order of any jurisdiction (whether of right or in fact) or of any
agency thereof purporting to reduce, amend, restructure or
otherwise affect any term of any Facility Document or Liability;
(d) without being limited by the foregoing, any lack of
validity or enforceability of any Facility Document or Liability;
and (e) any other setoff, defense or counterclaim whatsoever
(in any case, whether based on contract, tort or any other theory)
with respect to the Facility Documents or the transactions
contemplated thereby which might constitute a legal or equitable
defense available to, or discharge of, the Borrower or a
Guarantor.
3. Guaranty
Irrevocable . This Guaranty is a continuing guaranty of the
payment of all Liabilities now or hereafter existing under the
Facility Documents and shall remain in full force and effect until
payment in full of all Liabilities and other amounts payable under
this Guaranty and until the Facility Documents are no longer in
effect.
4. Reinstatement
. This Guaranty shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any
of the Liabilities is rescinded or must otherwise be returned by
the Guaranteed Party on the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, all as though the
payment had not been made.
5. Subrogation .
No Guarantor shall exercise any rights which it may acquire by way
of subrogation, by any payment made under this Guaranty or
otherwise, until all the Liabilities have been paid in full and the
Facility Documents are no longer in effect. If any amount is paid
to a Guarantor on account of subrogation rights under this Guaranty
at any time when all the Liabilities have not been paid in full,
the amount shall be held in trust by such Guarantor for the benefit
of the Guaranteed Parties and shall be promptly paid to the
Administrative Agent for the benefit of the Guaranteed Parties to
be credited and applied to the Liabilities, whether matured or
unmatured or absolute or contingent, in accordance with the terms
hereof and of the Facility Documents. If a Guarantor makes payment
to the Guaranteed Parties of all or any part of the Liabilities and
all the Liabilities are paid in full and the Facility Documents are
no longer in effect, the applicable Guaranteed Party shall, at such
Guarantor’s request, execute and deliver to such Guarantor
appropriate documents, without recourse and without representation
or warranty, necessary to evidence the transfer by subrogation to
such Guarantor of an interest in the Liabilities resulting from the
payment.
6. Subordination
. Without limiting the Guaranteed Parties’ rights under
any other agreement, any liabilities owed by the Borrower to a
Guarantor in connection with any extension of credit or financial
accommodation by a Guarantor to or for the account of the Borrower,
including but not limited to interest accruing at the agreed
contract rate after the commencement of a bankruptcy or similar
proceeding, are hereby subordinated to the Liabilities, and such
liabilities of the Borrower to such Guarantor, if the
Administrative Agent so requests, shall be collected, enforced and
received by such Guarantor as trustee for the Guaranteed Parties
and shall be paid over to the Administrative Agent for the benefit
of the Guaranteed Parties on account of the Liabilities but without
reducing or affecting in any manner the liability of such Guarantor
under the other provisions of this Guaranty.
7. Payments Generally
. All payments by a Guarantor hereunder shall be made in the
manner, at the place and in the currency (the “Payment
Currency”) required by the applicable Facility Document;
provided, however, that (if the Payment Currency is other than
dollars) a Guarantor may, at its option (or, if for any reason
whatsoever such Guarantor is unable to effect payments in the
foregoing manner, such Guarantor shall be obligated to) pay to the
applicable Guaranteed Party at its principal office the equivalent
amount in dollars as reasonably determined by the applicable
Guaranteed Party. In any case in which a Guarantor makes or is
obligated to make payment in dollars, such Guarantor shall hold the
applicable Guaranteed Party harmless from any loss incurred by it
arising from any change in the value of dollars in relation to the
Payment Currency between the date the Liability becomes due and the
date the Guaranteed Party is actually able, following the
conversion of the dollars paid by such Guarantor into the Payment
Currency and remittance of such Payment Currency to the place where
such Liability is payable, to apply such Payment Currency to such
Liability.
8. Certain Taxes
. Except as otherwise provided herein, each Guarantor further
agrees that all payments to be made hereunder shall be made without
setoff or counterclaim and free and clear of, and without deduction
for, any taxes, levies, imposts, duties, charges, fees, deductions,
withholdings or restrictions or conditions of any nature whatsoever
now or hereafter imposed, levied, collected, withheld or assessed
by any country or by any political subdivision or taxing authority
thereof or therein (“Taxes”). If any Taxes are required
to be withheld from any amounts payable to a Guaranteed Party
hereunder, the amounts so payable to such Guaranteed Party shall be
increased to the extent necessary to yield to such Guaranteed Party
(after payment of all Taxes) the amounts payable hereunder in the
full amounts so to be paid. Whenever any such Tax is withheld and
paid by a Guarantor, as promptly as possible thereafter, such
Guarantor shall send the Administrative Agent an official receipt
showing payment thereof, together with such additional documentary
evidence as may be reasonably required from time to time by the
Administrative Agent or such Guaranteed Party. Notwithstanding any
of the foregoing, no Guarantor shall be required to indemnify or
make additional or increased payments with respect to Taxes in
connection with a payment hereunder to the extent that such
payment, if made by the Borrower, would not give rise to
indemnification or additional or increased payments pursuant to
Section 2.14 of the Credit Agreement; provided, however that
the preceding clause shall not apply with respect to any non-U.S.
Guarantor.
9. Representations and
Warranties . Each Guarantor represents and warrants that:
(a) the execution, delivery and performance of this Guaranty by
such Guarantor (i) are within such Guarantor’s corporate
or other organizational powers and have been duly authori
