Exhibit 10.3
EXECUTION COPY
GUARANTY
GUARANTY (this “Guaranty”), dated as of January 15, 2009, by each of the Persons
listed on Schedule I hereto (each such Person, individually, a “Guarantor” and,
collectively, the “Guarantors”) in favor of (a) Wells Fargo Retail Finance, LLC,
a Delaware limited liability company, as administrative agent (in such capacity,
the “Administrative Agent”) and collateral agent (in such capacity, the
“Collateral Agent” and, collectively with the Administrative Agent, the
“Agents”) for its own benefit and the benefit of the other Credit Parties (as
defined in the Credit Agreement referred to below), and (b) the Credit Parties.
W I T N E S S E T H
WHEREAS, reference is made to that certain Credit Agreement, dated as of
January 15, 2009 (as amended, modified, supplemented or restated and in effect
from time to time, the “Credit Agreement”), by and among (i) A.C. Moore
Incorporated, a Virginia corporation (the “Lead Borrower”), as agent for the
Borrowers from time to time party thereto (individually, a “Borrower” and,
collectively with the Lead Borrower, the “Borrowers”), (ii) the Borrowers,
(iii) the Guarantors, (iv) the Lenders from time to time party thereto
(individually, a “Lender” and, collectively, the “Lenders”), and (v) Wells Fargo
Retail Finance, LLC, as Administrative Agent, Collateral Agent and Swing Line
Lender, pursuant to which the Lenders have agreed to make Loans to the Borrowers
upon the terms and subject to the conditions specified in the Credit Agreement.
Capitalized terms used herein and not defined herein shall have the meanings
assigned to such terms in the Credit Agreement.
WHEREAS, each Guarantor acknowledges that it will receive direct and indirect
benefits from the availability of the credit facility provided for in the Credit
Agreement, from the making of the Loans by the Lenders.
WHEREAS, the obligations of the Lenders to make Loans is conditioned upon, among
other things, the execution and delivery by the Guarantors of a guaranty in the
form hereof. As consideration therefor, and in order to induce the Lenders to
make Loans, the Guarantors are willing to execute this Guaranty.
Accordingly, the parties hereto agree as follows:
SECTION 1. Guaranty. Each Guarantor irrevocably and unconditionally guarantees,
jointly with the other Guarantors and severally, as a primary obligor and not
merely as a surety, the due and punctual payment when due (whether at the stated
maturity, by required prepayment, by acceleration or otherwise) and performance
by each of the Borrowers of all Obligations (collectively, the “Guaranteed
Obligations”), including all such Guaranteed Obligations which shall become due
but for the operation of the Debtor Relief Laws. The Guarantor further agrees
that the Guaranteed Obligations may be extended or renewed, in whole or in part,
without notice to or further assent from it, and that it will remain bound upon
this Guaranty notwithstanding any extension or renewal of any Guaranteed
Obligation.

 

 

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SECTION 2. Guaranteed Obligations Not Affected. To the fullest extent permitted
by applicable Law, each Guarantor waives presentment to, demand of payment from,
and protest to, any Loan Party of any of the Guaranteed Obligations, and also
waives notice of acceptance of this Guaranty, notice of protest for nonpayment
and all other notices of any kind. To the fullest extent permitted by applicable
Law, the obligations of each Guarantor hereunder shall not be affected by
(a) the failure of any Agent or any other Credit Party to assert any claim or
demand or to enforce or exercise any right or remedy against any Loan Party
under the provisions of the Credit Agreement, any other Loan Document or
otherwise or against any other party with respect to any of the Guaranteed
Obligations, (b) any rescission, waiver, amendment or modification of, or any
release from, any of the terms or provisions of this Guaranty, or of any other
Loan Document or any other agreement, with respect to any Loan Party or with
respect to the Guaranteed Obligations (except as expressly set forth in such
recission, waiver, amendment or modification), (c) the failure to perfect any
security interest in, or the release of, any of the Collateral held by or on
behalf of the Collateral Agent or any other Credit Party, or (d) the lack of
legal existence of any Loan Party or legal obligation to discharge any of the
Guaranteed Obligations by any Loan Party for any reason whatsoever, including,
without limitation, in any insolvency, bankruptcy or reorganization of any Loan
Party.
SECTION 3. Security. Each Guarantor hereby acknowledges and agrees that the
Collateral Agent and each of the other Credit Parties may (a) take and hold
security for the payment of this Guaranty and the Guaranteed Obligations and
exchange, enforce, waive and release any such security, (b) apply such security
and direct the order or manner of sale thereof as they in their sole discretion
may determine, and (c) release or substitute any one or more endorsees,
Borrowers, other Loan Parties or other obligors, in each case without affecting
or impairing in any way the liability of any Guarantor hereunder.
SECTION 4. Guaranty of Payment. Each Guarantor further agrees that this Guaranty
constitutes a guarantee of payment and performance when due of all Guaranteed
Obligations and not of collection and, to the fullest extent permitted by
applicable Law, waives any right to require that any resort be had by the
Collateral Agent or any other Credit Party to any of the Collateral or other
security held for payment of the Guaranteed Obligations or to any balance of any
deposit account or credit on the books of any Agent or any other Credit Party in
favor of any Loan Party or any other Person or to any other Guarantor of all or
part of the Guaranteed Obligations. Any payment required to be made by any
Guarantor hereunder may be required by any Agent or any other Credit Party on
any number of occasions and shall be payable to the Administrative Agent, for
the benefit of the Agents and the other Credit Parties, in the manner provided
in the Credit Agreement.

 

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SECTION 5. Indemnification.
(a) Without limiting or duplicating any of their indemnification obligations
under the Credit Agreement or the other Loan Documents, each of the Guarantors
shall jointly and severally indemnify the Agents (and any sub-agent thereof),
each other Credit Party, and each Related Party of any of the foregoing Persons
(each such Person being called an “Indemnitee”) against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities,
settlement payments, costs and related expenses (including the fees, charges and
disbursements of any counsel for any Indemnitee) incurred, suffered, sustained
or required to be paid by any Indemnitee or asserted against any Indemnitee by
any third party or by any Guarantor arising out of, in connection with, or as a
result of, (i) the execution or delivery of this Guaranty, the Credit Agreement,
any other Loan Document or any other agreement or instrument contemplated hereby
or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder, or the consummation of the transactions
contemplated hereby or thereby, or, in the case of the Agents (and any sub-agent
thereof) and their Related Parties only, the administration of this Guaranty,
the Credit Agreement and the other Loan Documents, or (ii) any actual or
prospective claim, litigation, investigation or proceeding relating to or
arising from any of the foregoing, whether based on contract, tort or any other
theory, whether brought by a third party or by any Guarantor, or any of the
Guarantors’ directors, shareholders or creditors, and regardless of whether any
Indemnitee is a party thereto, in all cases, whether or not caused by or
arising, in whole or in part, out of the comparative, contributory or sole
negligence of the Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses (x) are determined by a court of competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee or (y) result from a claim
brought by a Borrower or any other Loan Party against an Indemnitee for breach
in bad faith of such Indemnitee’s obligations hereunder or under any other Loan
Document, if the Borrowers or such Loan Party has obtained a final and
nonappealable judgment in its favor on such claim as determined by a court of
competent jurisdiction. In connection with any indemnified claim hereunder, the
Indemnitee shall be entitled to select its own counsel and the Guarantors shall
promptly pay the reasonable fees and expenses of such counsel.
(b) To the fullest extent permitted by applicable Law, the Guarantors shall not
assert, and hereby waive, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Guaranty, the Credit Agreement, any other Loan Document or any
agreement or instrument contemplated hereby, or the transactions contemplated
hereby or thereby. No Indemnitee referred to in subsection (a) above shall be
liable for any damages arising from the use by unintended recipients of any
information or other materials distributed to such unintended recipients by such
Indemnitee through telecommunications, electronic or other information
transmission systems in connection with this Guaranty, the Credit Agreement or
the other Loan Documents or the transactions contemplated hereby or thereby
other than for direct or actual damages resulting from the gross negligence or
willful misconduct of such Indemnitee as determined by a final and nonappealable
judgment of a court of competent jurisdiction.
(c) The agreements in this Section 5 shall survive the resignation of any Agent,
the termination of the Aggregate Commitments and the repayment, satisfaction or
discharge of all the other Guaranteed Obligations.

 

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SECTION 6. No Discharge or Diminishment of Guaranty. The obligations of each
Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (other than upon (i) termination of the
Aggregate Commitments, (ii) the indefeasible payment in full in cash of the
Guaranteed Obligations (other than contingent indemnification obligations for
which no claim has been asserted and any Other Liabilities which are not by
their terms then due and payable provided that the Agents shall have received
such indemnities and collateral security as they shall have required in
accordance with the terms of Section 10.11 of the Credit Agreement), (iii) the
expiration or termination of all Letters of Credit, except to the extent fully
Cash Collateralized or supported by another letter of credit in a manner
reasonably satisfactory to the L/C Issuer and the Administrative Agent, and
(iv) termination of the Administrative Agent’s obligation to endeavor to cause
the L/C Issuer to issue Letters of Credit under the Credit Agreement), including
any claim of waiver, release, surrender, alteration or compromise of any of the
Guaranteed Obligations, and shall not be subject to any defense or set-off,
counterclaim, recoupment or termination whatsoever by reason of the invalidity,
illegality or unenforceability of the Guaranteed Obligations or otherwise.
Without limiting the generality of the foregoing, the Guaranteed Obligations of
each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by the failure of any Agent or any other Credit Party to assert any
claim or demand or to enforce any remedy under this Guaranty, the Credit
Agreement, any other Loan Document or any other agreement, by any waiver or
modification of any provision of any thereof, by any default, failure or delay,
willful or otherwise, in the performance of the Guaranteed Obligations, or by
any other act or omission that may or might in any manner or to any extent vary
the risk of any Guarantor or that would otherwise operate as a discharge of any
Guarantor as a matter of law or equity (other than the indefeasible payment in
full in cash of the Guaranteed Obligations).
SECTION 7. Defenses of Loan Parties Waived. To the fullest extent permitted by
applicable Law, each Guarantor waives any defense based on or arising out of any
defense of any other Loan Party or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of any other Loan Party, other than the indefeasible payment in
full in cash of the Guaranteed Obligations. Each Guarantor hereby acknowledges
that the Agents and the other Credit Parties may, at their election, foreclose
on any security held by one or more of them by one or more judicial or
nonjudicial sales, accept an assignment of any such security in lieu of
foreclosure, compromise or adjust any part of the Guaranteed Obligations, make
any other accommodation with any other Loan Party, or exercise any other right
or remedy available to them against any other Loan Party, without affecting or
impairing in any way the liability of each such Guarantor hereunder except to
the extent that the Guaranteed Obligations have been indefeasibly paid in full
in cash. Pursuant to, and to the extent permitted by, applicable Law, each
Guarantor waives any defense arising out of any such election and waives any
benefit of and right to participate in any such foreclosure action, even though
such election operates, pursuant to applicable Law, to impair or to extinguish
any right of reimbursement, indemnity, contribution or subrogation or other
right or remedy of such Guarantor against any Loan Party, as the case may be, or
any security. Each Guarantor agrees that it shall not assert any claim in
competition with any Agent or any other Credit Party in respect of any payment
made hereunder in connection with any proceedings under any Debtor Relief Laws.

 

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SECTION 8. Agreement to Pay; Subordination. In furtherance of the foregoing and
not in limitation of any other right that the Agents or any other Credit Party
has at law or in equity against any Guarantor by virtue hereof, upon the failure
of any Loan Party to pay any Guaranteed Obligation when and as the same shall
become due, whether at maturity, by acceleration, after notice of prepayment or
otherwise, each Guarantor hereby promises to and will forthwith pay, or cause to
be paid, to the Agents or such other Credit Party as designated thereby in cash
the amount of such unpaid Guaranteed Obligations. Upon payment by any Guarantor
of any sums to any Agent or any other Credit Party as provided above, all rights
of such Guarantor against any Loan Party arising as a result thereof by way of
right of subrogation, contribution, reimbursement, indemnity or otherwise shall
in all respects be subordinate and junior in right of payment to the prior
indefeasible payment in full in cash of all the Guaranteed Obligations. In
addition, any indebtedness of any Borrower or any other Loan Party now or
hereafter held by any Guarantor is hereby subordinated in right of payment to
the prior indefeasible payment in full of all of the Guaranteed Obligations.
Notwithstanding the foregoing, as long as no Event of Default exists, any
Borrower or any other Loan Party may make payments to any Guarantor on account
of any such indebtedness. After the occurrence and during the continuance of an
Event of Default, none of the Guarantors will demand, sue for, or otherwise
attempt to collect any such indebtedness until (i) termination of the Aggregate
Commitments, (ii) the indefeasible payment in full in cash of the Guaranteed
Obligations (other than contingent indemnification obligations for which no
claim has been asserted and any Other Liabilities which are not by their terms
then due and payable provided that the Agents shall have received such
indemnities and collateral security as they shall have required in accordance
with the terms of Section 10.11 of the Credit Agreement), (iii) the expiration
or termination of all Letters of Credit (except to the extent fully Cash
Collateralized or supported by another letter of credit in a manner reasonably
satisfactory to the L/C Issuer and the Administrative Agent), and (iv) the
Administrative Agent has no further obligation to endeavor to cause the L/C
Issuer to issue Letters of Credit under the Credit Agreement. If any amount
shall erroneously be paid to any Guarantor on account of (a) such subrogation,
contribution, reimbursement, indemnity or similar right or (b) any such
indebtedness of any Loan Party, such amount shall be held in trust for the
benefit of the Credit Parties and shall forthwith be paid to the Administrative
Agent to be credited against the payment of the Guaranteed Obligations, whether
matured or unmatured, in accordance with the terms of the Credit Agreement.
SECTION 9. Limitation on Guaranty of Guaranteed Obligations. In any action or
proceeding with respect to any Guarantor involving any state corporate law, the
Debtor Relief Laws or any other state or federal bankruptcy, insolvency,
reorganization or other laws affecting the rights of creditors generally, if the
obligations of such Guarantor under this Guaranty would otherwise be held or
determined to be void, invalid or unenforceable, or subordinated to the claims
of any other creditors, on account of the amount of its liability under this
Guaranty, then, notwithstanding any other provision hereof to the contrary, the
amount of such liability shall, without any further action by such Guarantor,
any Credit Party, any Agent or any other Person, be automatically limited and
reduced to the highest amount which is valid and enforceable and not
subordinated to the claims of other creditors as determined in such action or
proceeding.

 

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SECTION 10. Information. Each Guarantor assumes all responsibility for being and
keeping itself informed of each Loan Party’s financial condition and assets, and
of all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks that such Guarantor
assumes and incurs hereunder, and agrees that none of the Agents or the other
Credit Parties will have any duty to advise such Guarantor of information known
to it or any of them regarding such circumstances or risks. The Guarantors have
reviewed and approved copies of the Loan Documents and are fully informed of the
remidies the Collateral Agent may pursue, with or without notice to the
Guarantors.
SECTION 11. Termination. This Guaranty (a) shall terminate when (i) the
Aggregate Commitments have terminated, (ii) all of the Guaranteed Obligations
(other than contingent indemnification obligations for which no claim has been
asserted and any Other Liabilities which are not by their terms then due and
payable provided that the Agents shall have received such indemnities and
collateral security as they shall have required in accordance with the terms of
Section 10.11 of the Credit Agreement) have been indefeasibly paid in full in
cash, (iii) all L/C Obligations have been reduced to zero (except to the extent
fully Cash Collateralized or supported by another letter of credit in a manner
reasonably satisfactory to the L/C Issuer and the Administrative Agent), and
(iv) the Administrative Agent has no further obligation to endeavor to cause the
L/C Issuer to issue Letters of Credit under the Credit Agreement, and (b) shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Guaranteed Obligation is rescinded or must
otherwise be restored by any Credit Party or any Guarantor in connection with
Debtor Relief Laws or otherwise.
SECTION 12. Costs of Enforcement. Without limiting or duplicating any of their
obligations under the Credit Agreement or the other Loan Documents, the
Guarantors, jointly and severally, agree to pay on demand all Credit Party
Expenses in connection with (i) the administration, negotiation, documentation
or amendment of this Guaranty, and (ii) any Agent’s or any other Credit Party’s
efforts to collect and/or to enforce any of the Guaranteed Obligations of any
Guarantor hereunder and/or to enforce any of the rights, remedies, or powers of
any Agent or any other Credit Party against or in respect of any Guarantor
(whether or not suit is instituted by or against any Agent or any other Credit
Party).
SECTION 13. Binding Effect; Assignments. Whenever in this Guaranty any party
hereto is referred to, such reference shall be deemed to include the successors
and assigns of such party, and all covenants, promises and agreements by or on
behalf of the Guarantors that are contained in this Guaranty shall bind and
inure to the benefit of each of the Guarantors and its respective successors and
assigns. This Guaranty shall be binding upon each of the Guarantors and their
respective successors and assigns, and shall inure to the benefit of the Agents
and the other Credit Parties, and their respective successors and permitted
assigns, except that no Guarantor shall have the right to assign or transfer its
rights or obligations hereunder or any interest herein (and any such attempted
assignment or transfer shall be void), except as expressly permitted by this
Guaranty or the Credit Agreement. This Guaranty shall be construed as a separate
agreement with respect to each Guarantor and may be amended, modified,
supplemented, waived or released with respect to any Guarantor without the
approval of any other Guarantor and without affecting the obligations of any
other Guarantor hereunder.

 

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SECTION 14. Waivers; Amendment.
(a) The rights, remedies, powers, privileges, and discretions of the Agents
hereunder and under applicable Law (herein, the “Agents’ Rights and Remedies”)
shall be cumulative and not exclusive of any rights or remedies which they would
otherwise have. No delay or omission by the Agents in exercising or enforcing
any of the Agents’ Rights and Remedies shall operate as, or constitute, a waiver
thereof. No waiver by the Agents of any Event of Default or default under any
other agreement shall operate as a waiver of any other Event of Default or
default hereunder or under any other agreement. No single or partial exercise of
any of the Agents’ Rights or Remedies, and no express or implied agreement or
transaction of whatever nature entered into between the Agents and any Person,
at any time, shall preclude the other or further exercise of the Agents’ Rights
and Remedies. No waiver by the Agents of any of the Agents’ Rights and Remedies
on any one occasion shall be deemed a waiver on any subsequent occasion, nor
shall it be deemed a continuing waiver. The Agents’ Rights and Remedies may be
exercised at such time or times and in such order of preference as the Agents
may determine. The Agents’ Rights and Remedies may be exercised without resort
or regard to any other source of satisfaction of the Guaranteed Obligations. No
waiver of any provisions of this Guaranty or any other Loan Document or consent
to any departure by any Guarantor therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) below, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given. No notice to or demand on any Guarantor in any case shall
entitle such Guarantor or any other Guarantor to any other or further notice or
demand in the same, similar or other circumstances.
(b) Neither this Guaranty nor any provision hereof may be waived, amended or
modified except pursuant to a written agreement entered into between the Agents
and the Guarantor or Guarantors with respect to whom such waiver, amendment or
modification is to apply, subject to any consent required in accordance with
Section 10.01 of the Credit Agreement.
SECTION 15. Copies and Facsimiles. This instrument and all documents which have
been or may be hereinafter furnished by any Guarantor to any of the Agents may
be reproduced by such Agents by any photographic, microfilm, xerographic,
digital imaging, or other process. Any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding
(whether or not the original is in existence and whether or not such
reproduction was made in the regular course of business). Any facsimile which
bears proof of transmission shall be binding on the party which or on whose
behalf such transmission was initiated and likewise so admissible in evidence as
if the original of such facsimile had been delivered to the party which or on
whose behalf such transmission was received.
SECTION 16. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 17. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in
Section 10.02 of the Credit Agreement, provided that communications and notices
to the Guarantors may be delivered to the Lead Borrower on behalf of the
Guarantors.

 

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SECTION 18. Survival of Agreement; Severability.
(a) All covenants, agreements, indemnities, representations and warranties made
by the Guarantors herein and in the certificates or other instruments delivered
in connection with or pursuant to this Guaranty, the Credit Agreement or any
other Loan Document shall be considered to have been relied upon by the Agents
and the other Credit Parties and shall survive the execution and delivery of
this Guaranty, the Credit Agreement and the other Loan Documents and the making
of any Loans by the Lenders and the issuance of any Letters of Credit by the L/C
Issuer, regardless of any investigation made by any Agent or any other Credit
Party or on their behalf and notwithstanding that any Agent or other Credit
Party may have had notice or knowledge of any Default or Event of Default or
incorrect representation or warranty at the time any credit is extended, and
shall continue in full force and effect until (i) the Aggregate Commitments have
terminated, (ii) the indefeasible payment in full in cash of the Guaranteed
Obligations (other than contingent indemnification obligations for which no
claim has been asserted and any Other Liabilities which are not by their terms
then due and payable provided that the Agents shall have received such
indemnities and collateral security as they shall have required in accordance
with the terms of Section 10.11 of the Credit Agreement), (iii) the expiration
or termination of all Letters of Credit (except to the extent fully Cash
Collateralized or supported by another letter of credit in a manner reasonably
satisfactory to the L/C Issuer and the Administrative Agent), and (iv) the
Administrative Agent has no further obligation to endeavor to cause the L/C
Issuer to issue Letters of Credit under the Credit Agreement. The provisions of
Section 5 and Section 11 hereof shall survive and remain in full force and
effect regardless of the repayment of the Guaranteed Obligations, the expiration
or termination of the Letters of Credit and the Aggregate Commitments or the
termination of this Guaranty or any provision hereof.
(b) Any provision of this Guaranty held to be invalid, illegal or unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such invalidity, illegality or unenforceability without affecting the
validity, legality and enforceability of the remaining provisions hereof, and
the invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.
SECTION 19. Counterparts. This Guaranty may be executed in counterparts, each of
which shall constitute an original but all of which, when taken together, shall
constitute a single contract. Delivery of an executed counterpart of a signature
page to this Guaranty by facsimile or electronic transmission shall be as
effective as delivery of a manually executed counterpart of this Guaranty.
SECTION 20. Rules of Interpretation. The rules of interpretation specified in
Section 1.02 through 1.05 of the Credit Agreement shall be applicable to this
Guaranty.

 

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SECTION 21. Jurisdiction; Waiver of Venue; Consent to Service of Process.
(a) EACH GUARANTOR IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS
PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE
SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OTHER
LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH
GUARANTOR IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF
ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE
COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL
COURT. EACH GUARANTOR AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
GUARANTY OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE AGENTS,
ANY LENDER OR THE L/C ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR
PROCEEDING RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY
GUARANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
(b) EACH GUARANTOR IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS GUARANTY OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN
PARAGRAPH (A) OF THIS SECTION. EACH GUARANTOR HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM
TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(c) EACH GUARANTOR IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER
PROVIDED FOR NOTICES IN SECTION 17. NOTHING IN THIS GUARANTY WILL AFFECT THE
RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
SECTION 22. Waiver of Jury Trial. EACH GUARANTOR, EACH AGENT, AND EACH CREDIT
PARTY (BY ITS ACCEPTANCE HEREOF) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH GUARANTOR,
EACH AGENT, AND EACH CREDIT PARTY (BY ITS ACCEPTANCE HEREOF) (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT
HAS BEEN INDUCED TO ENTER INTO (OR ACCEPT) THIS GUARANTY AND THE OTHER LOAN
DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 22.

 

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SECTION 23. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Credit Party and each of its respective Affiliates is hereby
authorized at any time and from time to time, after obtaining the prior written
consent of the Administrative Agent or the Required Lenders, to the fullest
extent permitted by applicable Law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final, in whatever currency)
at any time held and other obligations (in whatever currency) at any time owing
by such Credit Party or any such Affiliate to or for the credit or the account
of any Guarantor against any of and all the Guaranteed Obligations of such
Guarantor now or hereafter existing under this Guaranty or any other Loan
Document to such Credit Party, irrespective of whether or not such Credit Party
shall have made any demand under this Guaranty or any other Loan Document and
although such obligations of such Guarantor may be unmatured or are owed to a
branch or office of such Credit Party different from the branch or office
holding such deposit or obligated on such indebtedness. The rights of each
Credit Party and its respective Affiliates under this Section 23 are in addition
to other rights and remedies (including other rights of setoff) that such Credit
Party or its respective Affiliates may have. Each Credit Party agrees to notify
the Guarantors and the Administrative Agent promptly after any such setoff and
application, provided that the failure to give such notice shall not affect the
validity of such setoff and application.
[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the Guarantors have duly executed this Guaranty as of the
day and year first above written.

            Guarantors:

A.C. MOORE ARTS & CRAFTS, INC.
      By:   /s/ Rodney B. Schriver         Name:   Rodney B. Schriver       
Title:   Vice President        MOORESTOWN FINANCE, INC.
      By:   /s/ Rodney B. Schriver         Name:   Rodney B. Schriver       
Title:   Vice President        BLACKWOOD ASSETS, INC.
      By:   /s/ Rodney B. Schriver         Name:   Rodney B. Schriver       
Title:   Vice President   

Signature Page to Guaranty