Exhibit 10.5
GUARANTY
THIS GUARANTY (the “
Guaranty ”), dated as of October 16, 2009, is
executed by each of the undersigned corporations, limited liability
companies, and limited partnerships (collectively the “
Guarantors ” and individually each a “
Guarantor ”), in favor of U.S. National Bank
Association, acting as trustee under the Indenture defined below
(in such capacity, the “ Trustee ”).
RECITALS
A.
Vitesse Semiconductor Corporation, a
Delaware corporation (the “ Issuer ”), and the
Forbearing Holders (as defined in the Forbearance Agreement (as
defined below)) have entered into that certain Forbearance
Agreement dated as of the date hereof (the “ Forbearance
Agreement ”) pursuant to which the Forbearing Holders
have agreed to forbear from exercising certain of the rights and
remedies available to them arising from the Specified Defaults (as
defined in the Forbearance Agreement) in exchange for Issuer
agreeing to enter into the Third Supplemental Indenture (as defined
below).
B.
The Issuer and the Trustee have
entered into an Indenture dated as of September 22, 2004 (as
amended by that certain First Supplemental Indenture dated
November 3, 2006, that certain Second Supplemental Indenture
dated September 24, 2007, and that certain Third Supplemental
Indenture, dated as of the date hereof, among the Forbearing
Holders (as defined therein) and the Issuer (the “ Third
Supplemental Indenture ”), as the same may hereafter be
amended, supplemented, extended, restated, or otherwise modified
from time to time, the “ Indenture ”) pursuant
to which the Issuer issued the Securities (as defined in the
Indenture) to the Holders. Capitalized terms used herein but
not otherwise defined shall have the meanings assigned to them in
the Indenture.
C.
Each Guarantor is a subsidiary of
the Issuer
D.
It is a requirement of the Third
Supplemental Indenture that this Guaranty be executed and delivered
by each Guarantor.
E.
Each Guarantor finds it
advantageous, desirable and in its best interests to comply with
the requirement that it execute and deliver this Guaranty to the
Trustee.
AGREEMENT
NOW, THEREFORE, for good and
valuable consideration, the sufficiency of which the parties hereby
acknowledge, the parties hereto hereby covenant and agree as
follows:
Section 1.
Defined
Terms . As used in this
Guaranty, the following terms shall have the meaning
indicated:
“ Issuer ” shall
have the meaning indicated in Recital A.
“ Indenture ”
shall have the meaning indicated in Recital B.
“ Intercreditor
Agreement ” shall have the meaning given such term in the
Indenture.
“ Forbearance Agreement
” shall have the meaning indicated in Recital A.
“ Guarantor ”
shall have the meaning indicated in the opening paragraph
hereof.
“ Guaranty ”
shall have the meaning indicated in the opening paragraph
hereof.
“ Holder ” shall
have the meaning given such term in the Indenture.
“ Indenture Documents
” shall have the meaning given such term in the
Indenture.
“ Material Adverse
Occurrence ” shall mean any occurrence of whatsoever
nature (including, without limitation, any adverse determination in
any litigation, arbitration, or governmental investigation or
proceeding), which could reasonably be expected to materially and
adversely affect (a) the financial condition or operation of
the Issuer and its subsidiaries taken as a whole, (b) impair
the ability of the Issuer or any subsidiary to perform its
obligations under the Indenture or any writing executed pursuant
thereto, (c) the validity or enforceability of the material
obligations of the Issuer or any subsidiary under any Indenture
Document, (d) the rights and remedies of the Holders or the
Trustee against the Issuer hereunder, (e) the timely payment
of the principal of and interest on the Notes or other amounts
payable by the Issuer hereunder, or (f) the validity of the
joint and several nature of the obligations of the Issuer with
respect to all of the Obligations.
“ Obligations ”
shall mean (a) all indebtedness, liabilities and obligations
of the Issuer to the Holders of every kind, nature or description
under the Indenture, including the Issuer’s obligation on any
notes issued under the Indenture (including, without limitation,
any obligation to pay Forbearance Interest (as defined in the
Forbearance Agreement)) and any note or notes hereafter issued in
substitution or replacement thereof, in all cases whether due or to
become due, and whether now existing or hereafter arising or
incurred and (b) any and all liabilities and obligations of
the Issuer to the Holders and the Trustee of every kind, nature and
description, whether direct or indirect or hereafter acquired by
the Holders from any Person, absolute or contingent, regardless of
how such liabilities arise or by what agreement or instrument they
may be evidenced, and (c) in all of the foregoing cases
whether due or to become due, and whether now existing or hereafter
arising or incurred for the benefit of the Holders.
“ Person ” shall
mean any individual, corporation, partnership, limited partnership,
limited liability company, joint venture, firm, association, trust,
unincorporated organization, government or governmental agency or
political subdivision or any other entity, whether acting in an
individual, fiduciary or other capacity.
“ Third Supplemental
Indenture ” shall have the meaning indicated in Recital
B.
“ Trustee ” shall
have the meaning indicated in the opening paragraph
hereof.
2
Section 2.
The
Guaranty . Each Guarantor,
jointly and severally, hereby absolutely and unconditionally
guarantees to the Trustee, the payment when due (whether at a
stated maturity or earlier by reason of acceleration or otherwise)
and performance of the Obligations.
Section 3.
Continuing
Guaranty . This Guaranty is an
absolute, unconditional and continuing guaranty of payment and
performance of the Obligations, and the obligations of the
Guarantors hereunder shall not be released, in whole or in part, by
any action or thing which might, but for this provision of this
Guaranty, be deemed a legal or equitable discharge of a surety or
guarantor, other than irrevocable payment and performance in full
of the Obligations. No notice of the Obligations to which
this Guaranty may apply, or of any renewal or extension thereof
need be given to the Guarantors and none of the foregoing acts
shall release the Guarantors from liability hereunder. Each
Guarantor hereby expressly waives (a) demand of payment,
presentment, protest, notice of dishonor, nonpayment or
nonperformance on any and all forms of the Obligations;
(b) notice of acceptance of this Guaranty and notice of any
liability to which it may apply; (c) all other notices and
demands of any kind and description relating to the Obligations now
or hereafter provided for by any agreement, statute, law,
rule or regulation; and (d) any and all defenses of the
Issuer pertaining to the Obligations except for the defense of
discharge by payment. No Guarantor shall be exonerated with
respect to such Guarantors’ liabilities under this Guaranty
by any act or thing except irrevocable payment and performance of
the Obligations, it being the purpose and intent of this Guaranty
that the Obligations constitute the direct and primary obligations
of each Guarantor and that the covenants, agreements and all
obligations of the Guarantors hereunder be absolute, unconditional
and irrevocable. Each Guarantor shall be and remain liable
for any deficiency remaining after foreclosure of any mortgage,
deed of trust or security agreement securing all or any part of the
Obligations, whether or not the liability of the Issuer or any
other Person for such deficiency is discharged pursuant to statute,
judicial decision or