Exhibit 10.9
 

 
 
AMENDED AND RESTATED GUARANTY   
 
Bank of America, N.A.
LENDER

 
 
                                                                                                                      

 November 13, 2007

 
                                                                                                                                                          
FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE
ACKNOWLEDGED, each of the undersigned Aeropostale West, Inc., a Delaware
corporation (the “Existing Guarantor”), Jimmy’Z Surf Co., Inc., a Delaware
corporation, and Aero GC Management LLC, a Virginia limited liability company,
each with offices at 112 West 34th Street, New York, New York 10120 (the
foregoing, together with the Existing Guarantor, individually a “Guarantor” and
collectively, the “Guarantors”) unconditionally guarantees, in accordance with
the terms hereof and without any prior written notice, the payment and
performance of the Liabilities (defined below) of Aeropostale, Inc. (the
“Borrower”), a Delaware corporation with its principal executive offices at 112
West 34th Street, New York, New York 10120 to Bank of America, N.A., a national
banking association with offices at 100 Federal Street, 9th Floor, Boston,
Massachusetts (the “Lender”).
 
WITNESSETH:
 
WHEREAS, the Borrower, the Guarantors and the Lender (as assignee of Fleet
Retail Finance Inc. (“Fleet”) pursuant to that certain Assignment and Acceptance
dated as of even date herewith by and between Fleet, as Assignor, and Bank of
America, N.A., as Assignee), are party to that certain Second Amended and
Restated Loan and Security Agreement dated as of even date herewith (as amended,
restated, supplemented or otherwise modified from time to time, the “Loan
Agreement”); and
 
WHEREAS, the Existing Guarantor is party to that certain Guaranty dated as of
February 1, 2002 (the “Existing Guaranty”) in favor of Fleet, pursuant to which
the Existing Guarantor agreed to guarantee certain obligations of the Borrower
to Fleet; and
 
WHEREAS, it is a condition precedent to the Lender’s continuing to make any
loans or otherwise extend credit to the Borrower under the Loan Agreement that
the Existing Guaranty be amended and restated in its entirety and that the
Guarantors execute and deliver to the Lender this guaranty (this “Guaranty”).
 
 
 
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Accordingly, the parties hereto agree as follows:
 
Definitions: Unless otherwise defined herein, all capitalized terms used herein
shall have the meaning given that term in the Loan Agreement.
 
“Liabilities”: (in the singular, “Liability”): Includes, without limitation, all
and each of the following, whether now existing or hereafter arising:
 
(a)           Any and all direct and indirect liabilities, debts, and
obligations of the Borrower to the Lender, each of every kind, nature, and
description under the Loan Documents.
 
(b)           Each obligation to repay any loan, advance, indebtedness, note,
obligation, overdraft, or amount now or hereafter owing by the Borrower to the
Lender under the Loan Documents (including all future advances whether or not
made pursuant to a commitment by the Lender), whether or not any of such are
liquidated, unliquidated, primary, secondary, secured, unsecured, direct,
indirect, absolute, contingent, or of any other type, nature, or description, or
by reason of any cause of action which the Lender may hold against the Borrower
under the Loan Documents.
 
(c)           All notes and other obligations of the Borrower now or hereafter
assigned to or held by the Lender with respect to the Loan Documents, each of
every kind, nature, and description.
 
(d)           All interest, fees, and charges and other amounts which may be
charged by the Lender to the Borrower under the Loan Documents and/or which may
be due from the Borrower to the Lender under the Loan Documents from time to
time.
 
 
 
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(e)           All costs and expenses incurred or paid by the Lender in respect
of any of the Loan Documents (including, without limitation, Costs of
Collection, reasonable attorneys’ fees, and all court and litigation costs and
expenses).
 
(f)           Any and all covenants of the Borrower to or with the Lender and
any and all obligations of the Borrower to act or to refrain from acting in
accordance with under Loan Documents.
 
(g)           Each of the foregoing as if each reference to the “Lender” therein
were to each Affiliate of the Lender.
 
(h)           Any and all direct or indirect liabilities, debts, and obligations
of the Borrower to the Lender or any Affiliate of the Lender, each of every
kind, nature, and description owing on account of any service or accommodation
provided to, or for the account of the Borrower pursuant to this or any other
Loan Document, including cash management services and the issuances of L/C’s.
 
Indemnification: FOR GOOD AND VALUABLE CONSIDERATION, each Guarantor shall
indemnify, defend, and hold the Lender and any employee, officer, or agent of
any of the foregoing (each, an “Indemnified Person”) harmless of and from any
claim brought or threatened against any Indemnified Person by the Borrower, each
Guarantor or any other guarantor or endorser of the Liabilities, or any other
Person (as well as from attorneys’ reasonable fees and expenses in connection
therewith) on account of the relationship of the Borrower, any Guarantor or any
other guarantor or endorser of the Liabilities with the Lender (each, an
“Indemnified Claim”) other than any claim resulting from the gross negligence or
willful misconduct of such Indemnified Person.  Each Indemnified Claim may be
defended, compromised, settled, or pursued by the Indemnified Person with
counsel of the Lender’s selection (and if such Indemnified Claim is brought by a
Person other than the Borrower, any Guarantor, or any guarantor or endorser of
the Liabilities or any Affiliate of the Borrower, after consultation with (but
not approval of) the Guarantors regarding the selection of such counsel), but at
the expense of the Guarantors, provided that any Indemnified Claim may not be
settled without the consent of the Guarantors (which shall not be unreasonably
withheld or delayed) if as the result of any such settlement the Guarantors will
be obligated to make any payment (other than reimbursement of the reasonable
costs and expenses of  the Indemnified Person). This indemnification shall
survive payment of the Liabilities and/or any termination, release, or discharge
executed by the Lender in favor of any Guarantor, other than a termination,
release, or discharge which makes specific reference to this provision of this
Guaranty.
 
 
 
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Interest: Each Guarantor will pay on demand, after the occurrence and during the
continuation of an Event of Default,  interest on all amounts due under this
Guaranty, or arising under any documents, instruments, or agreements relating to
any collateral securing this Guaranty, from the time the Lender first demands
payment of this Guaranty at a rate (determined based upon a 360 day year and
actual days elapsed) equal to the lesser from time to time of (a) the aggregate
of the Prime Rate from time to time announced by Bank of America, N.A. (or, if
said bank ceases to announce such a rate, the functional equivalent rate or
index selected in good faith by the Lender) plus two percent (2.0 %) per annum
or (b) the highest rate of interest which under the circumstances may be charged
under applicable law.
 
Obligations Not Affected: The obligations of each Guarantor hereunder shall not
be affected by: any fraudulent, illegal, or improper act by the Borrower, any
Guarantor, or any other Person liable or obligated to the Lender for or on the
Liabilities; any release, discharge, or invalidation, by operation of law or
otherwise, of the Liabilities; or the legal incapacity of the Borrower, any
Guarantor, or any other Person liable or obligated to the Lender for or on the
Liabilities.  Interest and Costs of Collection shall continue to accrue and
shall continue to be deemed Liabilities guarantied hereby notwithstanding any
stay to the enforcement thereof against the Borrower or any Guarantor or the
disallowance of any claim therefor against the Borrower or any Guarantor.
 
Incorporation Of All Discussions: This instrument incorporates all discussions
and negotiations between the Guarantors and the Lender concerning the guaranty
and indemnification provided by the Guarantors hereby.  No such discussions or
negotiations shall limit, modify, or otherwise affect the provisions hereof.  No
provision hereof may be altered, amended, waived, canceled or modified, except
by a written instrument executed, sealed, and acknowledged by a duly authorized
officer of the Lender.
 
 
 
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General Waivers: Each Guarantor WAIVES: presentment, demand, notice, and protest
with respect to the Liabilities and this Guaranty; any delay on the part of the
Lender; any right to require the Lender to pursue or to proceed against the
Borrower or any collateral which might have been granted to secure the
Liabilities or to secure the obligations of the Guarantors hereunder; any
benefit of, and any right to participate in, any collateral which may secure the
Liabilities; any claim which any Guarantor may have or to which any Guarantor
may become entitled to the extent that such claim might otherwise cause any
transfer to the Lender by or on behalf of the Borrower to be avoided as having
been, or in the nature of, a preference; and notice of acceptance of this
Guaranty.
 
Each Guarantor WAIVES any claim, defense, or benefit which is based on any of
the following (to the extent applicable notwithstanding the choice of
Massachusetts law as governing this Guaranty):
 
Section 580a, 580b, 580c, 580d, and 726, and Chapter 2 of Title 14 of the
California Code of Civil Procedure or any similar law of California or of any
other jurisdiction.
 
Sections 2787 to 2856 inclusive, and 2899 and 3433 of the California Civil Code
or any similar law of California or of any other jurisdiction.
 
California Commercial Code Sections 3116, 3118, 3119, 3419, 3605, 9504 and 9507
or any similar law of California or of any other jurisdiction.
 
Union Bank v. Gradsky and subsequent judicial decisions arising out of or
related to Sections 580a, 580b, 580c, 580d, and 726, and Chapter 2 of Title 14
of California Code of Civil Procedure or any similar law of California or of any
other jurisdiction.
 
WAIVERS CONCERNING ELECTION OF REMEDIES.  Each Guarantor WAIVES any claim or
defense which is based upon an election of remedies.
 
In the event that the Liabilities or this Guaranty are secured by real estate,
and in the event that the Lender elects to enforce the Lender’s rights against
such real property by way of nonjudicial foreclosure through the exercise of the
rights of power of sale, each Guarantor WAIVES any defense which, but for this
waiver, might be available to any Guarantor due to such election of remedies by
the Lender (including, without limitation, any claim that the Lender, by reason
of such election of remedies, has extinguished rights of the Guarantors to
proceed against the Borrower).
 
 
 
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Waiver of Subrogation: No Guarantor shall undertake any of the following:
 
(a)           Exercise of any right against the Borrower, by way of subrogation,
reimbursement, indemnity, contribution, or the like unless and until all
Liabilities have been irrevocably paid and satisfied in full.
 
(b)           The filing of any proof of any claim in competition with the
Lender in respect of any payment hereunder in any bankruptcy or insolvency
proceedings of any nature.
 
(c)           The claiming of any set-off or counterclaim against the Borrower
in respect of any liability of such Guarantor to the Borrower.
 
Subordination: The payment of any amounts due with respect to any indebtedness
of the Borrower now or hereafter held by any Guarantor for borrowed money is
hereby subordinated to the prior payment in full of the Liabilities. No
Guarantor shall demand, sue for, or otherwise attempt to collect any such
indebtedness.  Any amounts which are collected, enforced and received by any
Guarantor shall be held by such Guarantor as trustee for the Lender and shall be
paid over to the Lender on account of the Liabilities without affecting in any
manner the liability of any Guarantor under this Guaranty.
 
Lender’s Books and Records: The books and records of the Lender showing the
account between the Lender and the Guarantor shall be admissible in any action
or proceeding and constitute prima facie evidence and proof of the items
contained therein.
 
Guarantors’ Obligations Primary: The obligations of each Guarantor hereunder are
primary, with no recourse necessary by the Lender against the Borrower or any
collateral given to secure the Liabilities or to secure the obligations of such
Guarantor or any other Guarantor hereunder or against any other Person liable
for or on the Liabilities prior to proceeding against such Guarantor or any
other Guarantor hereunder.
 
 
 
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Changes In Liabilities: Each Guarantor assents to any indulgence or waiver which
the Lender might grant or give the Borrower and/or any other Person liable or
obligated  for or on the Liabilities.  Each Guarantor authorizes the Lender to
alter, amend, cancel, waive, or modify any term or condition of the Liabilities
and of the obligations of any other Person liable or obligated for or on the
Liabilities, without notice to, or consent from, such Guarantor or any other
Guarantor.  Each Guarantor authorizes the Lender to complete this Guaranty and
any instrument or other document which evidences or relates to the Liabilities,
to the extent that this Guaranty or such instrument or other document, upon
delivery to the Lender, is incomplete in any respect.  No compromise,
settlement, or release by the Lender of the Liabilities or of the obligations of
any such other Person (whether or not jointly liable with any Guarantor) and no
release of any collateral securing the Liabilities or securing the obligations
of any such other Person shall affect the obligations of any Guarantor
hereunder.  No action by the Lender which has been assented to herein shall
affect the obligations of any Guarantor hereunder.
 
Financial Information: Each Guarantor, from time to time at the request of the
Lender, will provide the Lender with such information concerning the financial
condition of such Guarantor as the Lender reasonably may request (including but
not limited to financial statements in such form as reasonably may be requested
by the Lender and copies of the federal and state income tax returns).
 
Costs of Enforcement: Each Guarantor will pay on demand, without limitation, all
reasonable attorneys’ fees, out-of-pocket expenses incurred by the Lender’s
attorneys and all costs incurred by the Lender (including, without limitation,
costs and expenses associated with travel on behalf of the Lender), which fees,
expenses and costs are directly or indirectly related to or in respect of the
Lender’s administration, negotiation, documentation, and amendment of this
Guaranty and in the Lender’s efforts to collect and/or to enforce any of the
obligations of any Guarantor hereunder and/or to enforce any of the Lender’s
rights, remedies, or powers against or in respect of any Guarantor (whether or
not suit is instituted by or against the Lender).
 
 
 
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Binding Effect: This instrument shall inure to the benefit of the Lender and its
successors and assigns; shall be binding upon the respective heirs, successors,
representatives, and assigns of each Guarantor; and shall apply to all
Liabilities and any successor to the Borrower, including any successor by
operation of law.
 
Lender’s Rights and Remedies: The rights, remedies, powers, privileges, and
discretions of the Lender hereunder (herein, the “Lender’s Rights and Remedies”)
shall be cumulative and not exclusive of any rights or remedies which it would
otherwise have.  No delay or omission by the Lender in exercising or enforcing
any of the Lender’s Rights and Remedies shall operate as, or constitute a waiver
thereof.  No waiver by the Lender of any of the Lender’s Rights and Remedies or
of any default or remedies under any other agreement with any Guarantor, or of
any default under any agreement with the Borrower or any other Person liable or
obligated for or on the Liabilities, shall operate as a waiver of any other of
the Lender’s Rights and Remedies or of any default or remedy hereunder or
thereunder.  No exercise of any of the Lender’s Rights and Remedies and no other
agreement or transaction of whatever nature entered into between the Lender and:
any Guarantor; and the Borrower; and/or any such other Person at any time shall
preclude any other exercise of the Lender’s Rights and Remedies.  No waiver by
the Lender of any of the Lender’s Rights and Remedies on any one occasion shall
be deemed a waiver on any subsequent occasion, nor shall it be deemed a
continuing waiver.  All of the Lender’s Rights and Remedies, and all of the
Lender’s rights, remedies, powers, privileges, and discretions under any other
agreement or transaction with any Guarantor, the Borrower, or any such other
Person, shall be cumulative and not alternative or exclusive, and may be
exercised by the Lender at such time or times and in such order of preference as
the Lender in its sole discretion may determine.  The Lender’s Rights and
Remedies may be exercised without resort or regard to any other source of
satisfaction of the Liabilities.
 
Copies and Facsimiles: This Guaranty and all documents which have been or may be
hereinafter furnished by any Guarantor to the Lender may be reproduced 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.
 
 
 
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Choice of Laws: This Guaranty and all rights and obligations hereunder shall be
governed, construed, and interpreted in accordance with the laws of The
Commonwealth of Massachusetts.
 
Consent To Jurisdiction: (a) Each Guarantor agrees that any legal action,
proceeding, case, or controversy against such Guarantor with respect to this
Guaranty or otherwise, may be brought in the Superior Court of Suffolk County
Massachusetts or in the United States District Court, District of Massachusetts,
sitting in Boston, Massachusetts, as the Lender may elect in the Lender’s sole
discretion.  By execution and delivery of this Guaranty, each Guarantor accepts,
submits, and consents generally and unconditionally, to the jurisdiction of the
aforesaid courts.
 
(b)           Each Guarantor WAIVES personal service of any and all process and
irrevocably consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
certified mail, postage prepaid, to such Guarantor at the last address of such
Guarantor of which the Lender then has written notice, such service to become
effective ten (10) Business Days after such mailing.
 
(c)           Each Guarantor WAIVES, at the option of the Lender, any objection
based on forum non conveniens and any objection to venue of any action or
proceeding instituted hereunder or any other Loan Document to which such
Guarantor is a party.
 
(d)           Nothing herein shall affect the right of the Lender to bring legal
actions or proceedings in any other competent jurisdiction.
 
(e)           Each Guarantor agrees that any action commenced by such Guarantor
asserting any claim or counterclaim arising under or in connection with this
Guaranty or the Lender’s relationship with the Guarantor shall be brought in the
Superior Court of Suffolk County Massachusetts or in the United States District
Court, District of Massachusetts, sitting in Boston, Massachusetts, and that
such Courts shall have exclusive jurisdiction with respect to any such action.
 
 
 
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Broad Scope of Guaranty: It is the intention of each Guarantor that the
provisions of the within Guaranty and indemnification be liberally construed to
the end that the Lender may be put in as good a position as if the Borrower had
promptly, punctually, and faithfully performed all Liabilities and that such
Guarantor had promptly, punctually, and faithfully performed hereunder.
 
Severability: Any determination that any provision herein is invalid, illegal,
or unenforceable in any respect in any instance shall not affect the validity,
legality, or enforceability of such provision in any other instance and shall
not affect the validity, legality, or enforceability of any other provision
contained herein.
 
Right of Set-Off: Any and all deposits or other sums at any time credited by or
due from the Lender to any Guarantor or to any participant in the Liabilities (a
“Participant”) or from any Affiliate of Lender or any Participant and any cash,
securities, instruments or other property of any Guarantor in the possession of
the Lender or any Participant or any such Affiliate, whether for safekeeping or
otherwise (regardless of the reason the Lender or any Participant or any such
Affiliate had received the same) shall at all times constitute security for all
Liabilities and for any and all obligations of the Guarantors to the Lender and
any Participant, and may be applied or set off against the Liabilities and
against the obligations of the Guarantors to the Lender and any Participant
including, without limitation, those arising hereunder, at any time, whether or
not such are then due and whether or not other collateral is then available to
the Lender or any Participant or any such Affiliate.
 
Joint and Several Obligations: Each of the obligations of each and every
Guarantor under this Guaranty are joint and several.  This Guaranty may be
enforced against any Guarantor without any duty or responsibility to pursue any
other Guarantor and such enforcement shall not be a defense to any action
brought against any Guarantor hereunder.  The Lender hereby reserves all rights
against each Guarantor.
 
Termination: The obligations of each Guarantor hereunder shall remain in full
force and effect as to all Liabilities, without regard to any reduction of the
Liabilities (other than on account of payments made pursuant to the within
Guaranty) until the earlier of (a) ten (10) days following the actual receipt by
the Lender, at the address set forth on the first page hereof (or such other
address that the Lender indicates in writing to the Guarantors), of written
notice signed by each Guarantor of the termination thereof or (b) the delivery
of written notice of termination dated and signed by a duly authorized officer
of the Lender, which notice of termination includes specific reference to this
provision.  No termination hereof shall affect any Liability in existence or
outstanding ten (10) days following the date of such actual receipt or delivery
(including, without limitation, those which are contingent or not then due and
those which arise out of any check, draft, item, or paper which was made,
executed, or drawn prior to the expiration of such ten (10) days, even if
received by the Lender thereafter) nor any which arises out of any continuing
commitment or obligation of the Lender to provide loans, advances, and financial
accommodations to or for the account of the Borrower, nor any obligation of any
Guarantor hereunder, including, without limitation, any which by its terms
includes any of the Liabilities of a contingent nature (including, without
limitation, the indemnification provided for herein).  This Guaranty shall
continue to be effective or, if previously terminated, shall be automatically
reinstated, without any further action, if at any time any payment made or value
received with respect to a Liability is rescinded or must otherwise be returned
by the Lender upon the insolvency, bankruptcy or reorganization of any
Guarantor, or otherwise, all as though such payment had not been made or value
received.
 
 
 
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Miscellaneous: Each Guarantor represents and certifies that, prior to the
execution of this Guaranty, such Guarantor had carefully read and reviewed all
of the provisions of this Guaranty and had been afforded an opportunity to
consult with counsel independently selected by such Guarantor. Each Guarantor
further represents and certifies that such Guarantor has freely and willingly
executed this Guaranty with full appreciation of the legal effect of this
Guaranty. Each Guarantor recognizes that the titles to the paragraphs of the
within Guaranty are for ease of reference; are not part of this Guaranty; and do
not alter or affect the substantive provisions hereof.
 
 
 
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Waiver of Jury Trial: Each Guarantor makes the following waiver knowingly,
voluntarily, and intentionally, and understands that the Lender in the
establishment and maintenance of its relationship with the Borrower and such
Guarantor, is relying thereon. EACH GUARANTOR HEREBY IRREVOCABLY WAIVES ANY
PRESENT OR FUTURE RIGHT OF SUCH GUARANTOR, THE BORROWER OR ANY ENDORSER OR ANY
OTHER GUARANTOR OF THE BORROWER, OR ANY OTHER SIMILAR PERSON, TO A TRIAL BY JURY
OF ANY CASE OR CONTROVERSY IN WHICH THE LENDER IS OR BECOMES A PARTY (WHETHER
SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST THE LENDER OR THE LENDER IS
JOINED AS A PARTY LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF, OR IS IN
RESPECT OF, ANY RELATIONSHIP AMONGST OR BETWEEN SUCH GUARANTOR, THE BORROWER,
ANY SUCH PERSON, AND THE LENDER.
 

 
[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.  It is intended that this Guaranty take effect
as a sealed instrument.
 
                 AEROPOSTALE WEST, INC., as a Guarantor
 

By:
/s/ Michael J. Cunningham
Name:
Michael J. Cunningham
Title:
Executive Vice President and
 
Chief Financial Officer

                  JIMMY’Z SURF CO., INC., as a Guarantor

By:
/s/ Michael J. Cunningham
Name:
Michael J. Cunningham
Title:
Executive Vice President and
 
Chief Financial Officer

                  AERO GC MANAGEMENT LLC, as a Guarantor

By:
/s/ Michael J. Cunningham
Name:
Michael J. Cunningham
Title:
Executive Vice President and
 
Chief Financial Officer

 
1043974.2

 
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