EXHIBIT 10.8
IBM CREDIT CORPORATION
COLLATERALIZED GUARANTY
In consideration of credit and financing accommodations granted or to
be granted by IBM Belgium Financial Services S.A. a registered number of R.C.,
Brussels 451.673 with an address of Square Victoria Regina 1,BE-1210 Brussels
VAT BE 424300467 ("IBM GF") to Business Supplies Distributors Europe B.V. and
Supplies Distributors S.A. (collectively the "Borrower"), which is in the best
interest of Priority Fulfillment Services, Inc. ("Guarantor"), and for other
good and valuable consideration received, Guarantor jointly and severally
guaranties to IBM GF and to IBM Credit Corporation as agent to IBM GF ("IBM
Credit"), from property held separately, jointly or in community, the prompt and
unconditional performance and payment by Borrower of any and all obligations,
liabilities, contracts, mortgages, notes, trust receipts, secured transactions,
inventory financing and security agreements, and commercial paper on which
Borrower is in any manner obligated, heretofore, now, or hereafter owned,
contracted or acquired by IBM GF ("Liabilities"), whether the Liabilities are
individual, joint, several, primary, secondary, direct, contingent or otherwise.
Guarantor
also agrees to indemnify IBM GF and IBM Credit and hold IBM GF and IBM
Credit harmless against any losses it may sustain and expenses it may incur,
suffer or be liable for as a result of or in any way arising out of, following,
or consequential to any transactions with or for the benefit of Borrower.
Capitalized terms used herein without definition shall have the meaning
described thereto in the IBM Global Financing Platinum Plan (with Invoice
Discounting) between IBM GF and the Borrower (as amended, modified and
supplemented from time to time, the "Financing Agreement").
If Borrower fails to pay or perform any Liabilities to IBM GF when due, all
Liabilities to IBM GF shall then be deemed to have become immediately due and
payable, and Guarantor shall then pay upon demand the full amount of all sums
owed to IBM GF by Borrower, together with all expenses, including reasonable
attorney's fees.
The liability of Guarantor is direct and unconditional and shall not be affected
by any extension, renewal or other change in the terms of payment of any
security agreement or any other agreement between IBM GF and/or IBM Credit and
Borrower, or any change in the manner, place or terms of payment or performance
thereof, or the release, settlement or compromise of or with any party liable
for the payment or performance thereof, or the waiver of any default or event of
default under any financing agreement between IBM GF and/or IBM Credit and
Borrower, or the release or non-perfection of any security thereunder, any
change in Borrower's financial condition, or the interruption of business
relations between IBM GF and Borrower. This Guaranty is and shall be deemed to
be a continuing guaranty and shall remain in full force and effect until the
indefeasible payment in full of the Liabilities and any other amounts payable
under this Guaranty and the cessation of all obligations of IBM GF to extend
credit to Borrower. Guarantor acknowledges that its obligations hereunder are in
addition to and independent of any agreement or transaction between IBM GF
and/or IBM Credit and Borrower or any other person creating or reserving any
lien, encumbrance or security interest in any property of Borrower or any other
person as security for any obligation of Borrower. IBM GF and IBM Credit need
not exhaust its rights or recourse against Borrower or any other person or any
security IBM GF and IBM Credit may have at any time before being entitled to
payment from Guarantor.
To secure payment of all of Guarantor's current and future debts and obligations
to IBMGF, and to secure the Liabilities, whether under this Guaranty or any
other agreement between IBM GF and/or IBM Credit and Guarantor, whether direct
or contingent, Guarantor does assign, pledge and give to IBM GF a security
interest in all of Guarantor's personal property, whether now owned or hereafter
acquired or existing and wherever located, including the following: (a) all
inventory and equipment manufactured or sold by or bearing the trademark or
tradename of International Business Machines Corporation ("IBM") or any other
Authorized Supplier and all parts thereof, attachments, additions, accessories
and accessions thereto, all substitutions, repossessions, exchanges,
replacements and returns thereof, all price protection credits, rebates,
discounts and incentive payments relating to the foregoing, products thereof
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