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Exhibit
10.1
SUBSIDIARY
GUARANTY
THIS SUBSIDIARY GUARANTY
(this “ Guaranty ”) is made as of the 18th day
of March, 2005, by THE FINISH LINE MAN ALIVE, INC. (the “
Subsidiary Guarantor ”) in favor of the Agent, for the
ratable benefit of the Lenders, under the Credit Agreement referred
to below;
WITNESSETH:
WHEREAS, THE FINISH LINE,
INC., an Indiana corporation (“ TFL ”), THE
FINISH LINE USA, INC., an Indiana corporation (“ FLUSA
”), THE FINISH LINE DISTRIBUTION, INC., an Indiana
corporation (“ FLDC ”), FINISH LINE
TRANSPORTATION CO., INC., an Indiana corporation (“
FLTC ”), the institutions a party thereto as Lenders
(“ Lenders ”) and NATIONAL CITY BANK OF
INDIANA., a national banking association, in its capacity as
contractual representative (the “ Agent ”) for
itself and the other Lenders, have entered into a certain Credit
Agreement dated as of February 25, 2005 (as the 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 to TFL, FLUSA,
FLDC, and FLTC (collectively, the “ Borrowers
”);
WHEREAS, it is a requirement
under the Credit Agreement that the Subsidiary Guarantor execute
and deliver this Guaranty whereby the Subsidiary Guarantor shall
guarantee the payment when due, subject to Section 10 hereof, of
all principal, interest and other amounts that shall be at any time
due and payable by the Borrowers under the Credit Agreement, the
Notes and the other Loan Documents; and
WHEREAS, in consideration of
the financial and other support that the Borrowers have provided,
and such financial and other support as the Borrowers may in the
future provide, to the Subsidiary Guarantor, and in order to induce
the Lenders to make Loans under the Credit Agreement, the
Subsidiary Guarantor is willing to guarantee the obligations of the
Borrowers under the Credit Agreement, the Notes, and the other Loan
Documents;
NOW, THEREFORE, in
consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions
. Terms defined in the Credit Agreement and not otherwise defined
herein have, as used herein, the respective meanings provided for
therein.
SECTION 2.01
Representations and Warranties . The Subsidiary Guarantor
represents and warrants (which representations and warranties shall
be deemed to have been renewed upon each Advance under the Credit
Agreement) that:
(a) it (i) is a corporation
duly organized, validly existing and in existence under the laws of
the jurisdiction of its organization, (ii) is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of each jurisdiction in which failure to be so qualified and
in good standing could not reasonably be expected to have a
Material Adverse Effect, and (iii) has all requisite corporate
power or other necessary power and authority to own, operate and
encumber its property and to conduct its business as presently
conducted and as proposed to be conducted.
(b) it has all necessary
corporate power and authority to execute, deliver and perform its
obligations under this Guaranty; the execution, delivery and
performance of this Guaranty have been duly authorized by all
necessary corporate action; and this Guaranty has been duly and
validly executed and delivered by it and constitutes its legal,
valid and binding obligation, enforceable in accordance with its
terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, or moratorium or other
similar laws relating to the enforcement of creditors’ rights
generally and by general equitable principles.
(c) the execution, delivery
and performance of this Guaranty does not and will not (i) conflict
with the articles of incorporation or bylaws of Subsidiary
Guarantor, (ii) conflict with, result in a breach of or constitute
(with or without notice or lapse of time or both) a default under
any Requirement of Law (including, without limitation, any
Environmental Property Transfer Act) or Contractual Obligation of
Subsidiary Guarantor, or require termination of any Contractual
Obligation, except such interference, breach, default or
termination which individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect, (iii)
result in or require the creation or imposition of any Lien
whatsoever upon any of the property or assets of Subsidiary
Guarantor, other than Liens permitted by the Loan Documents, or
(iv) require any approval of Subsidiary Guarantor’s
shareholders except such as have been obtained. The execution,
delivery and performance of each of this Guaranty does not and will
not require any registration with, consent or approval of, or
notice to, or other action to, with or by any Governmental
Authority, including under any Environmental Property Transfer Act,
except filings, consents or notices which have been made, obtained
or given, or which, if not made, obtained or given, individually or
in the aggregate could not reasonably be expected to have a
Material Adverse Effect.
SECTION 2.02 Covenants
. The Subsidiary Guarantor covenants that, so long as any Lender
has any Commitment outstanding under the Credit Agreement or any
Obligation (other than contingent indemnity obligations) payable
under the Credit Agreement or any Note shall remain unpaid, that it
will not take any action that would result in a violation by the
Borrowers of the covenants and agreements set forth in the Credit
Agreement.
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SECTION 3. The
Guaranty . Subject to Section 10 hereof, the Subsidiary
Guarantor hereby unconditionally guarantees the full and punctual
payment (whether at stated maturity, upon acceleration or otherwise
but giving effect to any applicable notice or grace period) of the
principal of and interest on each Note issued by the Borrowers
pursuant to the Credit Agreement, and the full and punctual payment
of all other amounts payable by the Borrowers under the Credit
Agreement and the other Loan Documents including, without
limitation, the Obligations (all of the foregoing, subject to the
provisions of Section 10 hereof, being referred to collectively as
the “ Guaranteed Obligations ”). Upon failure by
the Borrowers to pay punctually any such amount, the Subsidiary
Guarantor agrees that it shall forthwith on demand pay the amount
not so paid at the place and in the manner specified in the Credit
Agreement, any Note or the relevant Loan Document, as the case may
be, it being agreed and acknowledged by the Subsidiary Guarantor
that this Guaranty constitutes a guaranty of payment (and not
collection), and that it shall not be necessary for the Agent or
any Lender to exercise any remedies against the Borrowers or any
other Person as a condition to a demand for payment under this
Guaranty.
SECTION 4. Guaranty
Unconditional . Subject to Section 10 hereof, the obligations
of the Subsidiary Guarantor hereunder shall be unconditional and
absolute and, without limiting the generality of the foregoing,
shall not be released, discharged or otherwise affected
by:
(a) any extension, renewal,
settlement, compromise, waiver or release in respect of any
obligation of the Borrowers under the Credit Agreement, any Note,
or any other Loan Document, by operation of law or otherwise or any
obligation of any other guarantor of any of the
Obligations;
(b) any modification or
amendment of or supplement to the Credit Agreement, any Note, or
any other Loan Document;
(c) any release,
nonperfection or invalidity of any direct or indirect security for
any obligation of the Borrowers under the Credit Agreement, any
Note, any security agreement, any Loan Document, or any obligations
of any other guarantor of any of the Obligations;
(d) any change in the
corporate or limited liability company existence, structure or
ownership of any of the Borrowers or any other guarantor of any of
the Obligations, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting any of the Borrowers, or any
other guarantor of the Obligations, or its assets or any resulting
release or discharge of any obligation of any of the Borrowers, or
any other guarantor of any of the Obligations;
(e) the existence of any
claim, setoff or other rights which the Subsidiary Guarantor may
have at any time against any of the Borrowers, any other guarantor
of any of the Obligations, the Agent, any Lender or any other
Person, whether in connection herewith or any unrelated
transactions;
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(f) any invalidity or
unenforceability relating to or against any of the Borrowers, or
any other guarantor of any of the Obligations, for any reason
related to the Credit Agreement, any other Loan Document, or any
provision of applicable law or regulation purporting to prohibit
the payment by the Borrowers, or any other guarantor of the
Obligations, of the principal of or interest on any Note or any
other amount payable by the Borrowers under the Credit Agreement,
the Notes, or any other Loan Document; or
(g) any other act or omission
to act or delay of any kind by the Borrowers, any other guarantor
of the Obligations, the Agent, any Lender or any other Person or
any other circumstance whatsoever which might, but for the
provisions of this paragraph, constitute a legal or equitable
discharge of the Subsidiary Guarantor’s obligations
hereunder.
SECTION 5. Discharge Only
Upon Payment In Full; Reinstatement In Certain
Circum
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