Master Subsidiary Guaranty - Bank of America NA and California Pizza Kitchen Inc.
MASTER SUBSIDIARY GUARANTY
To: Bank of America, N.A. ("Lender")
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RECITALS
A. Reference is made to that certain Credit Agreement dated as of
December 15, 2000 between California Pizza Kitchen, Inc., a California
corporation ("Borrower") and Lender (as amended, restated, extended,
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supplemented or otherwise modified in writing from time to time, the
"Agreement;" the terms defined therein being used herein as therein defined).
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B. Each Guarantor is a direct or indirect Domestic Subsidiary of Borrower
and has derived, and expects to continuing deriving, direct and indirect
benefits from extensions of credit made to Borrower, and now desires to guaranty
the Obligations
C. It is a requirement of the Credit Agreement that each direct or
indirect Domestic Subsidiary of Borrower execute and delivery this Master
Subsidiary Guaranty or a joinder hereto (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, this
"Guaranty").
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NOW, THEREFORE, each Guarantor agrees as follows:
1. For valuable consideration, each of the undersigned (together with
each Person becoming a party hereto pursuant to Paragraph 18 hereof, each, a
"Guarantor" and collectively, "Guarantors") unconditionally, absolutely and
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irrevocably jointly and severally guarantees and promises to pay to Lender, or
order, on demand, in lawful money of the United States and in immediately
available funds, any and all present or future Obligations owing to Lender and
Indemnitees (collectively, the "Guarantied Parties"). The term Obligations has
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the meaning assigned to such term under the Credit Agreement and is used herein
in its most comprehensive sense and includes any and all advances, debts,
obligations, and liabilities of all Borrower Parties, now, or hereafter made,
incurred, or created, whether voluntary or involuntarily, and however arising,
including, without limitation, any and all attorneys' fees (including the
allocated cost of inhouse counsel), costs, premiums, charges, or interest owed
by any Borrower Party to any Guarantied Party under the Loan Documents, whether
due or not due, absolute or contingent, liquidated or unliquidated, determined
or undetermined, whether a Borrower Party may be liable individually or jointly
with others, whether recovery upon such indebtedness may be or hereafter becomes
barred by any statute of limitations or whether such indebtedness may be or
hereafter become otherwise unenforceable.
2. This Guaranty is a continuing guaranty which relates to any
Obligations, including those which arise under successive transactions which
shall either cause a Borrower Party to incur new Obligations, continue the
Obligations from time to time, or renew them after they have been satisfied.
Each Guarantor agrees that nothing shall discharge or satisfy its obligations
created hereunder except for the full payment of the Obligations. Any payment
by any Guarantor shall not reduce its maximum obligation hereunder.
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3. Each Guarantor agrees that it is directly and primarily liable to the
Guarantied Parties, that its obligations hereunder are independent of the
Obligations of any Borrower Party, or of any other guarantor, and that a
separate action or actions may be brought and prosecuted against any Guarantor,
whether action is brought against a Borrower Party or whether a Borrower Party
is joined in any such action or actions. Each Guarantor agrees that any
releases which may be given by Guarantied Parties to a Borrower Party or any
other guarantor shall not release it from this Guaranty.
4. The obligations of each Guarantor under this Guaranty shall not be
affected, modified or impaired upon the occurrence from time to time of any of
the following, whether or not with notice to or the consent of any Guarantor (a)
the compromise, settlement, change, modification, amendment (whether material or
otherwise) or partial termination of any or all of the Obligations; (b) the
failure to give notice to any Guarantor of the occurrence of any Event of
Default under the terms and provisions of the Agreement; (c) the waiver of the
payment, performance or observance of any of the Obligations; (d) the taking or
omitting to take any actions referred to in any Loan Document or of any action
under this Guaranty; (e) any failure, omission or delay on the part of the
Guarantied Parties to enforce, assert or exercise any right, power or remedy
conferred in this Guaranty, the Credit Agreement, any other Loan Document or any
other indulgence or similar act on the part of the Guarantied Parties in good
faith and in compliance with applicable law; (f) the voluntary or involuntary
liquidation, dissolution, sale or other disposition of all or substantially all
of the assets, marshalling of assets, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors or readjustment of, or other similar
proceedings which affect any Guarantor, any other guarantor of any of the
Obligations of a Borrower Party or any of the assets of any of them, or any
allegation of invalidity or contest of the validity of this Guaranty in any such
proceeding; (g) to the extent permitted by law, the release or discharge of any
other guarantors of the Obligations from the performance or observance of any
obligation, covenant or agreement contained in any guaranties of the Obligations
by operation of law; or (h) the default or failure of any other guarantors of
the Obligations fully to perform any of their respective obligations set forth
in any such guaranties of the Obligations. To the extent any of the foregoing
refers to any actions which the Guarantied Parties may take, each Guarantor
hereby agrees that the Guarantied Parties may take such actions in such manner,
upon such terms, and at such times as the Guarantied Parties, in their
discretion, deem advisable, without, in any way or respect, impairing,
affecting, reducing or releasing any Guarantor from its undertakings hereunder
and each Guarantor hereby consents to each and all of the foregoing actions,
events and occurrences.
5. Each Guarantor hereby waives (a) any and all rights to require
Guarantied Parties to prosecute or seek to enforce any remedies against a
Borrower Party or any other party liable to Guarantied Parties on account of the
Obligations; (b) any right to assert against Guarantied Parties any defense
(legal or equitable), set-off, counterclaim, or claim which such Guarantor may
now or at any time hereafter have against a Borrower Party or any other party
liable to the Guarantied Parties in any way or manner under the Credit
Agreement; (c) all defenses, counterclaims and off-sets of any kind or nature,
arising directly or indirectly from the present or future lack of perfection,
sufficiency, validity or enforceability of any Loan Document and the security
interest granted pursuant thereto; (d) any defense arising by reason of any
claim or defense based upon an election of remedies by the Guarantied Parties
including, without limitation, any direction to proceed by judicial or
nonjudicial foreclosure or by deed in lieu
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thereof, which, in any manner impairs, affects, reduces, releases, destroys or
extinguishes such Guarantor's subrogation rights, rights to proceed against a
Borrower Party for reimbursement, or any other rights of such Guarantor to
proceed against a Borrower Party, against any other guarantor, or against any
other security, with such Guarantor understanding that the exercise by the
Guarantied Parties of certain rights and remedies may offset or eliminate such
Guarantor's right of subrogation against a Borrower Party, and that such
Guarantor may therefore incur partially or totally non-reimbursable liability
hereunder; (e) all presentments, demands for performance, notices of non-
performance, protests, notices of protest, notices of dishonor, notices of
default, notice of acceptance of this Guaranty, and notices of the existence,
creation, or incurring of new or additional indebtedness, and all other notices
or formalities to which such Guarantor may be entitled; and (f) without limiting
the generality of the foregoing, such Guarantor hereby expressly waives any and
all benefits of California Civil Code Sections 2809, 2810, 2819, 2825, 2839 and
2845 through 2850.
6. Each Guarantor hereby agrees that unless and until all Obligations
have been paid to Guarantied Parties in full, it shall not have any rights of
subrogation, reimbursement or contribution as against a Borrower Party or any
other guarantor, if any, and shall not seek to assert or enforce the same. Each
Guarantor understands that the exercise by the Guarantied Parties of certain
rights and remedies contained in the Loan Documents may affect or eliminate such
Guarantor's right of subrogation if any, against a Borrower Party and that such
Guarantor may therefore incur a partially or totally non-reimbursable liability
hereunder; nevertheless, such Guarantor hereby authorizes and empowers
Guarantied Parties to exercise, in their sole discretion, any right and remedy,
or any combination thereof, which may then be available, since it is the intent
and purpose of such Guarantor that the obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances.
7. Each Guarantor is presently informed of the financial condition of
each Borrower Party and of all other circumstances which a diligent inquiry
would reveal and which bear upon the risk of nonpayment of the Obligations. Each
Guarantor hereby covenants that it will continue to keep itself informed of the
financial condition of each Borrower Party, the status of other guarantors, if
any, and of all other circumstances which bear upon the risk of nonpayment. Each
Guarantor hereby waives its right, if any, to require the Guarantied Parties to
disclose to it any information which Lender may now or hereafter acquire
concerning such condition or circumstances including, but not limited to, the
release of any other guarantor.
8. Lender's books and records evidencing the Obligations shall be
admissible in any action or proceeding and shall be binding upon the Guarantors
for the purpose of establishing the terms set forth therein and shall constitute
prima facie proof thereof.
9. Notwithstanding anything to the contrary contained herein, the
obligations of each Guarantor hereunder shall be limited to an aggregate amount
equal to the largest amount that would not render its obligations hereunder
subject to avoidance under Section 548 of the Bankruptcy Code (Title 11, United
States Code) or any comparable provisions of any applicable state law.
10. Each Guarantor represents and warrants for and with respect to itself
that:
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(a) Guarantor is a corporation duly organized, validly existing and
in good standing under the Laws of the state of its incorporation, has the
power and authority and the legal right to own and operate its properties,
to lease the properties it operates and to conduct its business, is duly
qualified and in good standing under the Laws of each jurisdiction where
its ownership, lease or operation of properties or the conduct of its
business requires such qualification, and is in compliance with all Laws
except to the extent that noncompliance does not have a Material Adverse
Effect.
(b) Guarantor has the power and authority and the legal right to
make, deliver and perform this Guaranty and to authorize the execution,
delivery and performance of this Guaranty. No consent or authorization of,
filing with, or other act by or in respect of any Governmental Authority,
is required in connection with the execution, delivery, performance,
validity or enforceability of this Guaranty. This Guaranty has been duly
executed and delivered by Guarantor, and constitutes a legal, valid and
binding obligation of Guarantor, enforceable against Guarantor in
accordance with its terms, except as enforceability may be limited by
applicable Debtor Relief Laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability.
(c) The execution, delivery, and performance by Guarantor of this
Guaranty and compliance with the provisions hereof have been duly
authorized by all requisite action on the part of Guarantor and do not and
will not (i) violate or conflict with, or result in a breach of, or require
any consent, except where such violation, conflict, breach or failure to
obtain consent would not have a Material Adverse Effect, under (A) any
Organization Documents of Guarantor or any of its Subsidiaries, (B) any
applicable Laws, rules, or regulations or any order, writ, injunction, or
decree of any Governmental Authority or arbitrator, or (C) any Contractual
Obligation of Guarantor or any of its Subsidiaries or by which any of them
or any of their property is bound or subject, (ii) constitute a default
under any such agreement or instrument, except where such default would not
have a Material Adverse Effect or (iii) result in, or require, the creation
or imposition of any Lien on any material portion of the properties of
Guarantor or any of its Subsidiaries.
(d) No litigation, investigation or proceeding of or before an
arbitrator or Governmental Authority is pending or, to the best knowledge
of Guarantor, threatened by or against Guarantor or any of its Subsidiaries
or against any of their properties or revenues which, if determined
adversely, could have a Material Adverse Effect.
(e) The execution, delivery and performance by Guarantor of this
Guaranty does not constitute, to the best knowledge of Guarantor, a
"fraudulent conveyance," "fraudulent obligation" or "fraudulent transfer"
within the meanings of the Uniform Fraudulent Conveyances Act or Uniform
Fraudulent Transfer Act, as enacted in any jurisdiction.
11. All notices and other communications hereunder shall be delivered, in
the manner and with the effect provided in the Credit Agreement and, in the case
of Guarantors, in care of Borrower.
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12. This Guaranty shall be binding upon the successors and assigns of each
Guarantor and shall inure to the benefit of the Guarantied Parties' successors
and assigns. This Guaranty cannot be assigned by any Guarantor without the
prior written consent of Guarantied Parties which shall be in Guarantied
Parties' sole and absolute discretion.
13. No failure or delay by the Guarantied Parties in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
14. Guarantors shall jointly and severally pay (a) all reasonable out-of-
pocket expenses of Guarantied Parties, including reasonable fees and
disbursements of counsel (including the allocated cost of inhouse counsel and
staff) for Lender, in connection with any waiver or consent hereunder or any
amendment hereof and (b) all out-of-pocket expenses incurred by Guarantied
Parties, including fees and disbursements of counsel (including the allocated
cost of inhouse counsel and staff), in connection with the enforcement of this
Guaranty (whether or not suit is brought).
15. No modification of this Guaranty shall be effective for any purpose
unless it is in writing and executed by an officer of Lender authorized to do
so. This Guaranty merges all negotiations, stipulations and provisions relating
to the subject matter of this Guaranty which preceded or may accompany the
execution of this Guaranty.
16. Any indebtedness of Borrower Parties now or hereafter held by any
Guarantor is hereby subordinated to the indebtedness of Borrower Parties to
Guarantied Parties; and after the occurrence and during the continuance of an
Event of Default, such indebtedness of Borrower Parties to any Guarantor if
Lender so requests shall be collected, enforced and received by each Guarantor
as trustee for Guarantied Parties and be paid over to Lender on account of the
indebtedness of Borrower Parties to Guarantied Parties but without reducing or
affecting in any manner the liability of any Guarantor under the other
provisions of this guaranty.
17. It is not necessary for Guarantied Parties to inquire into the powers
of any Borrower Party or of the officers, directors or agents acting or
purporting to act on their behalf, and any indebtedness made or created in
reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
18. Any Person becoming a Domestic Subsidiary shall become a Guarantor
hereunder by executing and delivering a Joinder Agreement and by complying with
the terms of Section 6.13 of the Credit Agreement. Upon Lender`s receipt of a
duly executed and delivered Joinder Agreement, this Guaranty shall be deemed
amended to include such additional Person as a Guarantor, and such Person shall
become a party hereto as through a signatory hereto, with no amendment or
further action required hereunder, and thereafter, all references to Guarantors
shall include such additional Person.
19. THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
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GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA WITHOUT REFERENCE TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
20. This Guaranty may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which when so
executed and delivered shall be an original, but all of which shall together
constitute one and the same instrument.
DATED AS OF: December 15, 2000
"Guarantors"
CPK MANAGEMENT COMPANY
CALIFORNIA PIZZA KITCHEN
OF ILLINOIS, INC.
By /s/ Gregory S. Levin
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Gregory S. Levin
Vice President and Assistant Secretary
Acknowledged:
BANK OF AMERICA, N.A.
By: /s/ David J. Stassel
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David J. Stassel
Vice President
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