1011-00007 · Whitfield, Barr & Calloway LLP · Transaction Documents

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LIMITED GUARANTY OF LEASE

Meridian Holdings Inc., as Guarantor, in favor of Stonebridge Industrial Realty Trust, LP, as Landlord

[____], 2022

Reference: Lease Agreement dated as of [________________], 2022, between Stonebridge Industrial Realty Trust, LP, a Maryland limited partnership ("Landlord"), and Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), for premises known as Building 4, Cranbury Commerce Center, 200 Prospect Plains Road, Cranbury, New Jersey 08512 (Block 24, Lot 17.04, Township of Cranbury, Middlesex County, New Jersey)

LIMITED GUARANTY OF LEASE

THIS LIMITED GUARANTY OF LEASE (this "Guaranty") is made and entered into as of [____], 2022, by MERIDIAN HOLDINGS INC., a Delaware corporation ("Guarantor"), in favor of STONEBRIDGE INDUSTRIAL REALTY TRUST, LP, a Maryland limited partnership ("Landlord").

RECITALS

A. The Lease. Landlord and Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), have entered into (or are concurrently entering into) that certain Lease Agreement dated as of [____], 2022 (as the same may be amended, modified, supplemented, or restated from time to time, the "Lease") for approximately 297,500 rentable square feet (comprised of approximately 285,000 square feet of warehouse/distribution space and approximately 12,500 square feet of finished office/mezzanine space) at the premises commonly known as Building 4, Cranbury Commerce Center, located at 200 Prospect Plains Road, Cranbury, New Jersey 08512 (the "Premises"). The Lease provides for an initial term of ten (10) years, commencing on the date set forth therein.

B. Relationship of Guarantor to Tenant. Guarantor is a Delaware corporation and the direct parent entity of Tenant. Guarantor is itself majority-owned by Halcyon Ridge Capital Partners, LP, a Delaware limited partnership. The registered agent of Guarantor is c/o Cascade Systems, 1209 Orange Street, Wilmington, Delaware 19801. Guarantor's Employer Identification Number is 83-2460917.

C. Inducement; Consideration. Landlord has required, as a material condition to entering into the Lease, that Guarantor execute and deliver this Guaranty in favor of Landlord. Guarantor acknowledges that it will derive substantial direct and indirect economic benefit from the transactions contemplated by the Lease, including, without limitation, by reason of Guarantor's ownership interest in Tenant. Guarantor further acknowledges and agrees that Guarantor's execution and delivery of this Guaranty is a material inducement to Landlord's willingness to enter into the Lease with Tenant, and that Landlord would not have entered into the Lease absent Guarantor's execution and delivery of this Guaranty.

D. Capitalized Terms. All capitalized terms used and not otherwise defined in this Guaranty shall have the respective meanings ascribed to such terms in the Lease.

NOW, THEREFORE, in consideration of the foregoing recitals (which are incorporated herein by this reference), the execution and delivery of the Lease by Landlord, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor hereby agrees as follows:

ARTICLE 1 DEFINITIONS

Section 1.1 Defined Terms. As used in this Guaranty, the following terms shall have the meanings set forth below:

(a) "Burn-Off Date" means the date on which the Guarantor Net Worth Condition has been satisfied in accordance with, and as more fully described in, Section 6.1 and Section 6.2 of this Guaranty, and on which this Guaranty terminates in accordance with Article 6.

(b) "Guaranteed Obligations" means all obligations of Tenant under the Lease, whether monetary or non-monetary in nature, as more fully described in Section 2.1 of this Guaranty, subject in all cases to the Guaranty Cap as set forth in Section 2.2.

(c) "Guarantor" means Meridian Holdings Inc., a Delaware corporation, together with its permitted successors and assigns.

(d) "Guarantor Net Worth Condition" means the condition described in Section 6.1 of this Guaranty, being the achievement and maintenance by Tenant of a net worth of not less than Seventy-Five Million Dollars ($75,000,000) for two (2) consecutive fiscal quarters, as certified by the Independent Auditor in accordance with Article 6.

(e) "Guaranty Cap" means One Million Two Hundred Thousand Dollars ($1,200,000), which amount is equal to twelve (12) months of the Year 1 Annual Base Rent under the Lease (the Year 1 Annual Base Rent being One Million Two Hundred Thousand Dollars ($1,200,000), with monthly base rent of One Hundred Thousand Dollars ($100,000)), subject to the terms and conditions of Section 2.2 and Section 2.3 hereof.

(f) "Independent Auditor" means Ashford & Whitmore CPAs LLP, or such other nationally or regionally recognized independent certified public accounting firm as may be reasonably acceptable to Landlord.

(g) "Landlord" means Stonebridge Industrial Realty Trust, LP, a Maryland limited partnership, managed by its general partner, Stonebridge Industrial GP LLC, a Maryland limited liability company, with its principal office at 100 International Drive, Suite 600, Baltimore, Maryland 21202, together with its successors and assigns.

(h) "Lease" means that certain Lease Agreement described in Recital A above, as the same may be amended, modified, supplemented, or restated from time to time.

(i) "Tenant" means Meridian Consumer Brands LLC, a Delaware limited liability company, with its principal office and headquarters at 450 Park Avenue, 18th Floor, New York, New York 10022 (Employer Identification Number: 83-2461058).

ARTICLE 2 GUARANTY; GUARANTY CAP

Section 2.1 Guaranty of Obligations. Guarantor hereby absolutely, unconditionally, and irrevocably guarantees to Landlord the full and punctual payment and performance by Tenant of all obligations of Tenant arising under the Lease (collectively, the "Guaranteed Obligations"). The Guaranteed Obligations include, without limitation: (a) all monetary obligations of Tenant under the Lease, including, without limitation, Annual Base Rent, additional rent, Tenant's share of operating expenses, Tenant's share of real estate taxes, insurance costs, common area maintenance charges, utility charges, late charges, interest on overdue amounts, and all other sums of whatever nature payable by Tenant to Landlord under the Lease; (b) all obligations of Tenant to pay damages, costs, or expenses arising out of or in connection with any breach or default by Tenant under the Lease, including, without limitation, any holdover rent obligations, restoration costs, and indemnification obligations; and (c) all non-monetary performance obligations of Tenant under the Lease, including, without limitation, maintenance, repair, surrender, insurance, and compliance obligations. The foregoing notwithstanding, Guarantor's aggregate liability under this Guaranty shall in no event exceed the Guaranty Cap as set forth in Section 2.2 below.

Section 2.2 Limitation on Liability; Guaranty Cap. Notwithstanding anything to the contrary contained in this Guaranty, Guarantor's aggregate liability under this Guaranty shall not exceed the Guaranty Cap. The Guaranty Cap is One Million Two Hundred Thousand Dollars ($1,200,000), which represents twelve (12) months of the Year 1 Annual Base Rent under the Lease (calculated as One Hundred Thousand Dollars ($100,000) per month multiplied by twelve (12) months). The Guaranty Cap is a cap on aggregate cumulative liability of Guarantor under this Guaranty, and is not a per-claim cap, a per-annum cap, or a cap that resets or renews at any time during the term of this Guaranty. Once payments or expenditures made by or on behalf of Guarantor under this Guaranty equal One Million Two Hundred Thousand Dollars ($1,200,000) in the aggregate, Guarantor shall have no further obligation, liability, or responsibility under this Guaranty, and this Guaranty shall thereupon automatically terminate and be of no further force or effect (subject to the provisions of Section 2.3 below, if applicable, and subject to Section 6.4 with respect to pre-termination obligations).

Section 2.3 [Replenishment of Guaranty Cap.

[NOTE: THIS SECTION 2.3 IS BRACKETED AND REMAINS AN OPEN NEGOTIATION POINT. THE FOLLOWING REPRESENTS LANDLORD'S ANTICIPATED POSITION. CALDERWOOD & HARKNESS LLP'S POSITION ON BEHALF OF MERIDIAN CONSUMER BRANDS LLC AND HALCYON RIDGE CAPITAL PARTNERS, LP IS THAT THIS SECTION SHOULD BE DELETED IN ITS ENTIRETY AND THAT THERE SHOULD BE NO REPLENISHMENT OF THE GUARANTY CAP. IF THE GUARANTY CAP IS EXHAUSTED, THE GUARANTY SHOULD TERMINATE PERMANENTLY.]

[In the event that Guarantor shall have made payments to Landlord under this Guaranty equal to all or any portion of the Guaranty Cap, and Tenant shall subsequently cure the applicable default(s) and resume performance of its obligations under the Lease for a period of not less than [twelve (12)] consecutive months following such cure, the Guaranty Cap shall be replenished to its original amount of $1,200,000, and Guarantor's obligations hereunder shall be reinstated in full. For the avoidance of doubt, the maximum number of times the Guaranty Cap may be replenished during the term of this Guaranty is [________].]

[END OF BRACKETED PROVISION]

Section 2.4 Guaranty as Primary Obligation. This Guaranty is a guaranty of payment and performance and not merely a guaranty of collection. Landlord shall not be required to exhaust any right, remedy, or recourse against Tenant, any security deposit (including, without limitation, the Three Hundred Thousand Dollar ($300,000) irrevocable standby letter of credit issued by Harborview National Bank, N.A., as may be required under the Lease), any subtenant, any assignee, or any other person or entity, or to exhaust any right, remedy, or recourse with respect to any collateral, security, or other guaranty, before proceeding against Guarantor under this Guaranty. Guarantor agrees that, as between Guarantor and Landlord, the obligations of Tenant under the Lease may be declared to be forthwith due and payable as provided therein for purposes of this Guaranty, notwithstanding any stay, injunction, or other prohibition preventing such declaration as against Tenant, and that in the event of such declaration (or if such declaration is deemed to have been made), such obligations shall immediately become due and payable by Guarantor for purposes of this Guaranty.

ARTICLE 3 ABSOLUTE AND UNCONDITIONAL NATURE OF GUARANTY

Section 3.1 Unconditional Obligation. The obligations of Guarantor under this Guaranty are absolute, unconditional, and irrevocable, and shall remain in full force and effect until the earlier of (i) the termination of this Guaranty pursuant to Section 2.2 (exhaustion of the Guaranty Cap), (ii) the termination of this Guaranty pursuant to Article 6 (satisfaction of the Guarantor Net Worth Condition), or (iii) the expiration or earlier termination of the Lease and the full payment, performance, and satisfaction of all Guaranteed Obligations. Without limiting the generality of the foregoing, Guarantor's obligations hereunder shall not be released, diminished, impaired, reduced, or otherwise affected by any of the following, whether or not Guarantor shall have notice or knowledge thereof:

(a) any lack of validity or enforceability of the Lease or any provision thereof;

(b) any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease (subject to the limitation on the Guaranty Cap set forth in Section 3.2 below);

(c) any change in the time, manner, or place of payment or performance of any of the Guaranteed Obligations, or any change in the terms or conditions of the Lease;

(d) any exchange, release, surrender, impairment, or non-perfection of any collateral, security deposit, letter of credit, or other security for any of the Guaranteed Obligations;

(e) any change in the corporate or organizational structure of Tenant, whether by merger, consolidation, dissolution, reorganization, recapitalization, conversion, change of name, change of ownership, or otherwise;

(f) any assignment or subletting by Tenant of all or any portion of the Premises or Tenant's interest under the Lease, whether or not consented to by Landlord, and whether or not in accordance with the terms of the Lease;

(g) any bankruptcy, insolvency, reorganization, arrangement, adjustment, composition, receivership, liquidation, dissolution, or similar proceeding commenced by or against Tenant, including, without limitation, any proceeding under Title 11 of the United States Code (the Bankruptcy Code), or any comparable federal, state, or foreign law, and any discharge, stay, or injunction granted in or arising from any such proceeding;

(h) any failure of Landlord to file or enforce a claim against Tenant or the estate of Tenant (in any bankruptcy or other proceeding) or any other person or entity;

(i) any defense that may at any time be available to Tenant, whether based upon the statute of frauds, the statute of limitations, accord and satisfaction, laches, estoppel, waiver, or any other legal or equitable doctrine;

(j) any release or discharge of Tenant from the performance or observance of any obligation under the Lease resulting from any operation of law, including, without limitation, any discharge in bankruptcy; and

(k) any other circumstance, event, or condition (whether or not similar to any of the foregoing) that might otherwise constitute a legal or equitable defense available to, or constitute a discharge of, a guarantor or surety.

Section 3.2 Continuation Notwithstanding Modifications to Lease. This Guaranty shall remain in full force and effect notwithstanding any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease, whether or not made with or without Guarantor's knowledge or consent. Notwithstanding the foregoing, in the event that any amendment, modification, supplement, or restatement of the Lease increases the monetary obligations of Tenant beyond the original monetary obligations set forth in the Lease as of the date hereof, the Guaranty Cap shall not be increased by reason of any such increase in Tenant's monetary obligations without Guarantor's express prior written consent. For the avoidance of doubt, Guarantor's obligations under this Guaranty shall at no time exceed the Guaranty Cap, as such cap may be adjusted only with Guarantor's express prior written consent.

Section 3.3 No Conditions Precedent. There are no conditions precedent to the enforcement of this Guaranty by Landlord other than the occurrence of a default by Tenant under the Lease. Without limiting the foregoing, Landlord shall not be required to provide any notice to Guarantor of Tenant's default as a condition to exercising Landlord's rights under this Guaranty, except to the extent that Landlord is required by applicable law to provide notice of Guarantor's obligations hereunder prior to commencing legal proceedings against Guarantor.

ARTICLE 4 WAIVER OF DEFENSES

Section 4.1 Waiver of Suretyship Defenses. Guarantor hereby waives, to the fullest extent permitted by applicable law, each and every one of the following rights, defenses, and benefits:

(a) diligence, presentment, demand of payment, filing of claims with any court, protest, and notice of dishonor or of any default by Tenant under the Lease;

(b) notice of acceptance of this Guaranty by Landlord, it being acknowledged that this Guaranty shall be deemed accepted by Landlord upon Landlord's execution of the Lease;

(d) notice of any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease;

(e) any defense arising by reason of any disability, lack of authority, or other defense of Tenant, or by reason of the cessation or limitation of the liability of Tenant from any cause other than full and complete payment and performance of the Guaranteed Obligations;

(f) all defenses based upon suretyship or impairment of collateral, including, without limitation, all defenses that Guarantor may at any time assert under the laws of the State of New York, the State of New Jersey, the State of Delaware, or any other applicable jurisdiction relating to the rights and obligations of sureties and guarantors;

(g) the benefit of any statute of limitations affecting Guarantor's liability under this Guaranty or the enforcement thereof, to the extent permitted by applicable law;

(h) any right to require Landlord to proceed against Tenant or any other person or entity, or to pursue any other remedy in Landlord's power, before proceeding against Guarantor under this Guaranty;

(i) any right to require Landlord to apply any security deposit held under the Lease, or to draw upon or apply the proceeds of any letter of credit (including, without limitation, the irrevocable standby letter of credit issued by Harborview National Bank, N.A.), before demanding payment or performance from Guarantor under this Guaranty; and

(j) any other defense, right, or benefit that may be available to Guarantor in its capacity as a guarantor or surety under any applicable law.

Section 4.2 Waiver of Subrogation. Until such time as all Guaranteed Obligations have been fully paid, performed, and satisfied, and the Lease has expired or been terminated (and all obligations thereunder have been fully satisfied), Guarantor hereby waives any and all rights of subrogation, reimbursement, indemnification, exoneration, or contribution that Guarantor may now or hereafter have against Tenant, any co-guarantor, or any other person or entity, and any right to enforce any remedy that Landlord now has or may hereafter have against Tenant or any other person or entity, and any benefit of, or any right to participate in, any security or collateral given to or for the benefit of Landlord to secure payment or performance of any of the Guaranteed Obligations. Guarantor agrees that, to the extent that any such waiver of subrogation rights is not enforceable under applicable law, any such rights of subrogation shall in all respects be subordinate and junior to the rights of Landlord under this Guaranty and under the Lease.

ARTICLE 5 LANDLORD'S RIGHTS

Section 5.1 Direct Proceeding Against Guarantor. Landlord may, in its sole and absolute discretion, proceed directly and immediately against Guarantor under this Guaranty upon or at any time after the occurrence of a default by Tenant under the Lease, without first pursuing any remedy or right against Tenant, without first making any demand upon Tenant, without first applying any security deposit or letter of credit proceeds, and without first exhausting any other right, remedy, or recourse against Tenant, any subtenant, any assignee, or any other person or entity. Guarantor agrees and acknowledges that this Guaranty is a guaranty of payment and performance and not merely a guaranty of collection, and that Landlord's rights hereunder are independent of, and not contingent upon, Landlord's pursuit of any other remedy.

Section 5.2 No Obligation to Enforce Against Tenant First. Landlord shall have no obligation to make any demand upon, or pursue any claim, right, or remedy against, Tenant or any other person or entity, or to exhaust any security or collateral, before, concurrently with, or as a condition precedent to, making any demand upon or pursuing any claim, right, or remedy against Guarantor under this Guaranty. Landlord may pursue its rights and remedies against Guarantor and Tenant simultaneously, sequentially, or in any order that Landlord may elect in its sole and absolute discretion.

Section 5.3 Landlord's Right to Deal with Lease. Landlord may, at any time and from time to time, without notice to or the consent of Guarantor, and without in any way releasing, diminishing, impairing, or otherwise affecting the obligations of Guarantor hereunder:

(a) grant to Tenant one or more extensions of time for the payment or performance of any of the Guaranteed Obligations;

(b) accept partial payments from Tenant on account of the Guaranteed Obligations;

(c) settle or compromise any of the Guaranteed Obligations or any claim or dispute arising out of or in connection therewith;

(d) release, substitute, or add any one or more guarantors of the Guaranteed Obligations;

(e) release Tenant from, or waive compliance by Tenant with, any of the terms, covenants, conditions, or obligations of the Lease;

(f) modify, amend, supplement, restate, renew, extend, or replace any of the terms, covenants, conditions, or obligations of the Lease (subject to the limitation on the Guaranty Cap set forth in Section 3.2 of this Guaranty); and

(g) take or refrain from taking any other action that might otherwise constitute a legal or equitable discharge of Guarantor's obligations hereunder.

ARTICLE 6 BURN-OFF / RELEASE OF GUARANTY

Section 6.1 Guarantor Net Worth Condition. This Guaranty shall automatically terminate and be of no further force or effect (except as provided in Section 6.4 below) upon the satisfaction of all of the following conditions (collectively, the "Guarantor Net Worth Condition"):

(a) Tenant (Meridian Consumer Brands LLC) shall have achieved and maintained a net worth (defined as total assets minus total liabilities, in each case as reflected on Tenant's balance sheet) of not less than Seventy-Five Million Dollars ($75,000,000) for two (2) consecutive fiscal quarters of Tenant;

(b) Such net worth shall be calculated in accordance with generally accepted accounting principles in the United States ("GAAP"), consistently applied throughout the periods involved, using the same accounting methods, policies, practices, and procedures (with consistent classifications, judgments, and estimation methodologies) as those used in the preparation of Tenant's most recent audited financial statements;

(c) Such achievement and maintenance of the required net worth shall be certified in writing by the Independent Auditor (Ashford & Whitmore CPAs LLP, or such other nationally or regionally recognized independent certified public accounting firm as may be reasonably acceptable to Landlord) in a written certification substantially in the form attached hereto as Exhibit A (the "Net Worth Certification"), which Net Worth Certification shall be delivered to Landlord in accordance with Section 6.2 below; and

(d) At the time of delivery of such Net Worth Certification to Landlord, no Event of Default (or event that, with the giving of notice, the lapse of time, or both, would constitute an Event of Default) shall exist under the Lease.

Section 6.2 Delivery of Certification; Landlord Review Period. Tenant or Guarantor shall deliver to Landlord a written certification from the Independent Auditor confirming the satisfaction of the Guarantor Net Worth Condition (the Net Worth Certification), together with copies of the relevant quarterly financial statements of Tenant for the applicable two (2) consecutive fiscal quarters and such other supporting documentation as may be reasonably necessary to evidence satisfaction of the Guarantor Net Worth Condition. Landlord shall have a period of thirty (30) days following receipt of such Net Worth Certification and supporting documentation (the "Review Period") within which to review the Net Worth Certification and to object to the same. Any objection by Landlord must be in writing, must be delivered to Guarantor (or Tenant, as applicable) within the Review Period, and must set forth with reasonable specificity the grounds for such objection. If Landlord does not timely deliver a written objection within the Review Period, the Guarantor Net Worth Condition shall be deemed to have been satisfied, and this Guaranty shall terminate effective as of the last day of such thirty (30) day Review Period (such date being the "Burn-Off Date"). In the event that Landlord timely delivers a written objection, the parties shall work together in good faith to resolve such objection, and the Guaranty shall remain in full force and effect until the Guarantor Net Worth Condition is ultimately satisfied in accordance with this Article 6.

Section 6.3 Return of Guaranty. Upon termination of this Guaranty pursuant to this Article 6, Landlord shall execute and deliver to Guarantor a written release and termination of this Guaranty, in form and substance reasonably satisfactory to Guarantor, within fifteen (15) business days following the effective date of termination (the Burn-Off Date). Landlord's failure to execute and deliver such release and termination within such period shall not affect the termination of this Guaranty, which termination shall be effective automatically upon the Burn-Off Date as provided in Section 6.2.

Section 6.4 Survival of Pre-Termination Obligations. The termination of this Guaranty pursuant to this Article 6 shall not release, diminish, impair, or otherwise affect Guarantor's liability for any Guaranteed Obligations that arose prior to the effective date of termination (the Burn-Off Date), subject in all cases to the Guaranty Cap. For the avoidance of doubt, Guarantor shall remain liable for any Guaranteed Obligations that accrued or arose prior to the Burn-Off Date, even if a claim with respect thereto is asserted by Landlord after the Burn-Off Date, provided that the aggregate amount recovered from Guarantor under this Guaranty (whether before or after the Burn-Off Date) shall not exceed the Guaranty Cap.

ARTICLE 7 REPRESENTATIONS AND WARRANTIES OF GUARANTOR

Guarantor hereby represents and warrants to Landlord as of the date hereof as follows:

Section 7.1 Organization and Good Standing. Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. Guarantor has all requisite corporate power and authority to own, lease, and operate its properties and to carry on its business as now being conducted.

Section 7.2 Authority. Guarantor has full corporate power and authority to execute, deliver, and perform its obligations under this Guaranty. The execution and delivery of this Guaranty and the performance by Guarantor of its obligations hereunder have been duly authorized by all necessary corporate action on the part of Guarantor, including, without limitation, any required approval of Guarantor's board of directors or shareholders. No other corporate proceedings or approvals on the part of Guarantor are necessary to authorize the execution, delivery, and performance of this Guaranty.

Section 7.3 Enforceability. This Guaranty constitutes the legal, valid, and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or similar laws affecting creditors' rights and remedies generally, and (b) general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 7.4 No Conflicts. The execution, delivery, and performance by Guarantor of this Guaranty do not and will not (a) violate or conflict with the certificate of incorporation, bylaws, or other organizational documents of Guarantor, (b) violate or conflict with any applicable law, statute, rule, regulation, order, judgment, decree, or injunction of any court or governmental authority to which Guarantor is subject, or (c) result in a breach of, or constitute a default under, or require any consent under, any material contract, agreement, indenture, or other instrument to which Guarantor is a party or by which Guarantor or any of its assets may be bound.

Section 7.5 No Litigation. No litigation, arbitration, investigation, or governmental proceeding is pending or, to Guarantor's knowledge after reasonable inquiry, threatened against Guarantor that would reasonably be expected to materially adversely affect Guarantor's ability to perform its obligations under this Guaranty or that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Guaranty.

Section 7.6 Financial Condition. Guarantor has received adequate and sufficient consideration for the execution and delivery of this Guaranty. Guarantor is not insolvent (as defined under applicable federal or state law) and will not be rendered insolvent by the execution and delivery of this Guaranty or the performance of Guarantor's obligations hereunder. Guarantor is not engaged or about to engage in any business or transaction for which the property remaining with Guarantor is an unreasonably small capital, and Guarantor does not intend to incur, and does not believe that it will incur, debts beyond its ability to pay as they become due.

ARTICLE 8 COVENANTS OF GUARANTOR

Guarantor hereby covenants and agrees with Landlord as follows:

Section 8.1 Maintenance of Existence. During the term of this Guaranty, Guarantor shall maintain its corporate existence and good standing under the laws of the State of Delaware, and shall maintain all qualifications, licenses, and permits necessary for the conduct of its business, except where the failure to maintain such qualifications, licenses, or permits would not reasonably be expected to have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.

Section 8.2 Notice of Material Adverse Change. Guarantor shall notify Landlord in writing within thirty (30) days of the occurrence of any material adverse change in Guarantor's financial condition. For purposes of this Section 8.2, a "material adverse change" shall include, without limitation, (a) any decrease in Guarantor's net worth by more than twenty-five percent (25%) from the net worth reflected in the most recent financial statements delivered to Landlord, (b) the commencement of any bankruptcy, insolvency, reorganization, receivership, or similar proceeding by or against Guarantor, (c) the entry of any material judgment or order against Guarantor, and (d) any other event or condition that would reasonably be expected to materially impair Guarantor's ability to perform its obligations under this Guaranty.

Section 8.3 Financial Reporting. Upon Landlord's reasonable written request (which request shall not be made more than once per fiscal year of Guarantor), Guarantor shall deliver to Landlord financial statements of Guarantor (including, at a minimum, a balance sheet and statement of income and expenses, prepared in accordance with GAAP, consistently applied) within ninety (90) days after the end of each fiscal year of Guarantor for which such request is made. Such financial statements shall be certified by Guarantor's chief financial officer or by the Independent Auditor as presenting fairly, in all material respects, the financial position of Guarantor as of the date thereof and the results of Guarantor's operations for the period then ended, in accordance with GAAP. Any financial statements delivered to Landlord pursuant to this Section 8.3 shall be subject to the confidentiality restrictions set forth in Section 11.10 of this Guaranty, and Landlord shall not disclose such financial statements or any information contained therein to any person or entity other than Landlord's lender(s), legal counsel, and accountants, except as required by applicable law or court order.

Section 8.4 Merger/Dissolution Restrictions. Guarantor shall not dissolve, liquidate, or wind up its affairs, or merge with or consolidate into any other entity (whether or not Guarantor is the surviving entity), unless the following conditions are satisfied: (a) the surviving or successor entity (if other than Guarantor) shall expressly assume all of Guarantor's obligations under this Guaranty pursuant to a written instrument in form and substance reasonably satisfactory to Landlord, executed and delivered to Landlord contemporaneously with or prior to the consummation of such transaction; and (b) the surviving or successor entity shall have a net worth (calculated in accordance with GAAP) at the time of consummation of such transaction at least equal to the net worth of Guarantor immediately prior to such transaction. For the avoidance of doubt, a transfer of the equity interests of Guarantor (including, without limitation, any sale, transfer, or disposition by Halcyon Ridge Capital Partners, LP of its ownership interest in Guarantor) shall not constitute a merger, consolidation, dissolution, or liquidation of Guarantor for purposes of this Section 8.4; provided, however, that any such transfer shall not release or diminish Guarantor's obligations under this Guaranty.

ARTICLE 9 REMEDIES

Section 9.1 Cumulative Remedies. The rights and remedies of Landlord under this Guaranty are cumulative and are in addition to, and not in substitution for, all other rights and remedies available to Landlord under the Lease, at law, in equity, or otherwise. Without limiting the generality of the foregoing, Landlord's exercise of any right or remedy under the Lease shall not preclude Landlord from exercising any right or remedy under this Guaranty, and Landlord's exercise of any right or remedy under this Guaranty shall not preclude Landlord from exercising any right or remedy under the Lease, at law, in equity, or otherwise.

Section 9.2 No Waiver. No failure or delay by Landlord in exercising any right, power, or remedy under this Guaranty shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. No waiver of any provision of this Guaranty shall be effective unless made in a writing signed by Landlord, and no such waiver shall constitute a waiver of any other provision of this Guaranty or a continuing waiver of the same provision.

Section 9.3 Costs of Enforcement. In the event that Landlord prevails in any action, suit, or proceeding to enforce this Guaranty or any provision hereof (including, without limitation, any action to collect any amount due hereunder), Guarantor shall pay to Landlord all of Landlord's reasonable and documented attorneys' fees, costs, and expenses incurred in connection with such action, suit, or proceeding, including, without limitation, fees and costs incurred at the trial and appellate levels and in any bankruptcy or insolvency proceeding. Any amounts payable by Guarantor pursuant to this Section 9.3 shall be subject to the Guaranty Cap and shall be counted against the Guaranty Cap for purposes of determining whether the aggregate cap has been reached under Section 2.2.

ARTICLE 10 NOTICES

Section 10.1 Notice Provisions. All notices, demands, requests, consents, approvals, and other communications required or permitted to be given under this Guaranty shall be in writing and shall be deemed to have been duly given (a) when delivered personally (with written confirmation of receipt), (b) one (1) business day after deposit with a nationally recognized overnight courier service (such as Sundial Data Systems or Harborline Partners LLC), postage or fees prepaid, for next business day delivery, or (c) three (3) business days after deposit in the United States mail, certified mail, return receipt requested, postage prepaid, in each case addressed as follows:

If to Guarantor:

Meridian Holdings Inc. c/o Meridian Consumer Brands LLC 450 Park Avenue, 18th Floor New York, New York 10022

Attention: Kevin Driscoll, Vice President, Supply Chain & Logistics

With a copy (which shall not constitute notice) to:

Halcyon Ridge Capital Partners, LP 599 Lexington Avenue, 34th Floor New York, New York 10022

Attention: Martin Solberg, Principal

And a copy (which shall not constitute notice) to:

Calderwood & Harkness LLP 1285 Avenue of the Americas, 40th Floor New York, New York 10019

Attention: Angela Fontaine, Esq.

If to Landlord:

Stonebridge Industrial Realty Trust, LP 100 International Drive, Suite 600 Baltimore, Maryland 21202

Attention: Rebecca Hartwell, Senior Vice President, Leasing

With a copy (which shall not constitute notice) to:

Whitfield, Barr & Calloway LLP 1700 Market Street, Suite 3200 Philadelphia, Pennsylvania 19103

Attention: Thomas R. Calloway, Esq.

Section 10.2 Change of Address. Either party may change its address for notices and other communications under this Guaranty by giving written notice of such change to the other party in accordance with the provisions of this Section 10.1. Any such change of address shall be effective upon receipt of such notice by the other party.

ARTICLE 11 GENERAL PROVISIONS

Section 11.1 Governing Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice-of-law or conflicts-of-law rules, provisions, or principles (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.

Section 11.2 Jurisdiction and Venue. Guarantor hereby irrevocably and unconditionally submits to the exclusive jurisdiction of (a) the courts of the State of New York located in the County of New York (Borough of Manhattan) and (b) the United States District Court for the Southern District of New York, for the purposes of any action, suit, or proceeding arising out of or relating to this Guaranty or any transaction contemplated hereby. Guarantor hereby irrevocably and unconditionally waives any objection that it may now or hereafter have to the laying of venue of any such action, suit, or proceeding in any such court, and any claim that any such action, suit, or proceeding has been brought in an inconvenient forum. Guarantor agrees that a final judgment in any such action, suit, or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable law.

Section 11.3 Waiver of Jury Trial. GUARANTOR AND LANDLORD EACH HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, STATUTE, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS GUARANTY, THE LEASE, OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY ACKNOWLEDGES AND AGREES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO THE OTHER PARTY'S ENTERING INTO THIS GUARANTY AND THAT EACH PARTY HAS BEEN REPRESENTED BY LEGAL COUNSEL IN CONNECTION WITH THIS WAIVER.

Section 11.4 Entire Agreement. This Guaranty constitutes the entire agreement between Guarantor and Landlord with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, representations, and warranties, whether written or oral, with respect to the subject matter hereof. No representation, warranty, promise, inducement, or statement of intention has been made by either party that is not embodied in this Guaranty, and neither party shall be bound by or liable for any alleged representation, warranty, promise, inducement, or statement of intention not so set forth.

Section 11.5 Amendments. This Guaranty may not be amended, modified, supplemented, or restated except by a written instrument executed by both Guarantor and Landlord. No oral agreement, course of dealing, or trade usage shall serve to amend, modify, or waive any provision of this Guaranty.

Section 11.6 Successors and Assigns. This Guaranty shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Landlord and its successors and assigns. Landlord may freely assign this Guaranty, without the consent of Guarantor, in connection with any sale, transfer, or other disposition of Landlord's interest in the Lease, the Premises, or the property of which the Premises form a part, and upon any such assignment, the assignee shall succeed to all of Landlord's rights under this Guaranty. Guarantor may not assign, delegate, or otherwise transfer any of its obligations or liabilities under this Guaranty without the prior written consent of Landlord, which consent may be withheld in Landlord's sole and absolute discretion. Any purported assignment by Guarantor in violation of this Section 11.6 shall be null and void and of no force or effect.

Section 11.7 Severability. If any provision of this Guaranty is held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Guaranty, and this Guaranty shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. The parties agree that any such invalid, illegal, or unenforceable provision shall be reformed to the minimum extent necessary to make such provision valid, legal, and enforceable while preserving the intent of the parties.

Section 11.8 Counterparts. This Guaranty may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original, and all of which counterparts taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Guaranty by facsimile or electronic transmission (including portable document format (.pdf)) shall be effective as delivery of a manually executed counterpart of this Guaranty.

Section 11.9 Interpretation. The headings and captions used in this Guaranty are for convenience of reference only and shall not affect the interpretation or construction of this Guaranty. Unless the context otherwise requires, (a) references to "Sections" and "Articles" refer to Sections and Articles of this Guaranty, (b) references to the Lease shall include all amendments, modifications, supplements, and restatements thereof, (c) the words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation," (d) the words "herein," "hereof," "hereby," "hereunder," and words of similar import refer to this Guaranty as a whole and not to any particular provision hereof, and (e) references to any law, statute, rule, or regulation shall be deemed to include all amendments and successor provisions thereto.

Section 11.10 Confidentiality. Landlord shall maintain the confidentiality of all financial statements, financial information, and other non-public information of Guarantor delivered to Landlord pursuant to this Guaranty (collectively, "Guarantor Confidential Information"), and shall not disclose any Guarantor Confidential Information to any person or entity, except to (a) Landlord's lender(s) and prospective lender(s), provided that such lender(s) agree to maintain the confidentiality thereof, (b) Landlord's legal counsel, (c) Landlord's accountants, (d) Landlord's partners, members, directors, officers, and employees who have a need to know such information in connection with the administration of the Lease and this Guaranty, or (e) as required by applicable law, regulation, judicial process, or court order (provided that Landlord shall use commercially reasonable efforts to provide Guarantor with prompt notice of any such requirement prior to disclosure, to the extent permitted by law). The obligations of Landlord under this Section 11.10 shall survive the termination or expiration of this Guaranty.

Section 11.11 Relationship to Lease. This Guaranty is an ancillary document to the Lease and is being executed and delivered in connection with the Lease. In the event of any conflict or inconsistency between the terms and provisions of this Guaranty and the terms and provisions of the Lease with respect to Guarantor's obligations hereunder, the terms and provisions of this Guaranty shall control and govern. Nothing contained in this Guaranty shall be construed to amend, modify, or otherwise affect the terms of the Lease as between Landlord and Tenant.

IN WITNESS WHEREOF, Guarantor has duly executed and delivered this Limited Guaranty of Lease as of the date first written above.

GUARANTOR:

MERIDIAN HOLDINGS INC., a Delaware corporation

By: ________

Name: [________]

Title: [________]

Date: [________]

ACCEPTED AND ACKNOWLEDGED BY LANDLORD:

STONEBRIDGE INDUSTRIAL REALTY TRUST, LP, a Maryland limited partnership

By: Stonebridge Industrial GP LLC,

a Maryland limited liability company, its General Partner

By: ________

Name: [________]

Title: [________]

Date: [________]

EXHIBIT A

FORM OF INDEPENDENT AUDITOR CERTIFICATION (Guarantor Net Worth Condition / Burn-Off)

[Ashford & Whitmore CPAs LLP Letterhead] 750 Third Avenue, 22nd Floor New York, New York 10017

[Date]

Stonebridge Industrial Realty Trust, LP 100 International Drive, Suite 600 Baltimore, Maryland 21202

Attention: Rebecca Hartwell, Senior Vice President, Leasing

Re: Net Worth Certification — Meridian Consumer Brands LLC Limited Guaranty of Lease dated [____], 2022, by Meridian Holdings Inc. in favor of Stonebridge Industrial Realty Trust, LP (the "Guaranty")

Ladies and Gentlemen:

We have been engaged by Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), and Meridian Holdings Inc., a Delaware corporation ("Guarantor"), to provide this certification in connection with the Guaranty referenced above. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Guaranty.

We have reviewed the unaudited quarterly financial statements of Tenant for the fiscal quarters ending [___] and [___] (collectively, the "Review Periods"), and have performed such additional procedures as we considered necessary in the circumstances, in accordance with the attestation standards established by the American Institute of Certified Public Accountants.

Based upon our review, we hereby certify as follows:

1. The net worth of Tenant (calculated as total assets minus total liabilities) as of the end of the fiscal quarter ending [___] was $[___], which is not less than Seventy-Five Million Dollars ($75,000,000).

2. The net worth of Tenant (calculated as total assets minus total liabilities) as of the end of the fiscal quarter ending [___] was $[___], which is not less than Seventy-Five Million Dollars ($75,000,000).

3. Such net worth has been calculated in accordance with generally accepted accounting principles in the United States ("GAAP"), consistently applied throughout the Review Periods, using the same accounting methods, policies, practices, and procedures (with consistent classifications, judgments, and estimation methodologies) as those used in the preparation of Tenant's most recent audited annual financial statements.

4. Accordingly, the Guarantor Net Worth Condition, as defined in Section 6.1 of the Guaranty, has been satisfied.

This certification is issued solely for the benefit of Stonebridge Industrial Realty Trust, LP, in its capacity as Landlord under the Guaranty, and may not be relied upon by any other person or entity without our prior written consent.

Very truly yours,

ASHFORD & WHITMORE CPAs LLP

By: ________

Name: [________]

Title: Partner

Date: [________]

INTERNAL DRAFTING NOTES (APPENDED TO DRAFT — NOT PART OF FINAL GUARANTY)

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT PREPARED BY CALDERWOOD & HARKNESS LLP MATTER NO. 1011-00007

Prepared by: Cynthia Ho and Grace Nakamura, Calderwood & Harkness LLP, with review by Angela Fontaine, Esq.

Circulation: Internal to Meridian Consumer Brands LLC / Halcyon Ridge Capital Partners, LP deal team only.

Status: This draft has NOT been transmitted to Whitfield, Barr & Calloway LLP or to Stonebridge Industrial Realty Trust, LP.

Open Items Flagged for Negotiation:

1. Section 2.3 — Replenishment of Guaranty Cap. The MCB/Halcyon Ridge position is that there should be no replenishment of the Guaranty Cap under any circumstances. Once the $1,200,000 cap is exhausted through payments made by Guarantor, the Guaranty should terminate permanently. We anticipate significant landlord push-back on this point. Landlord's counsel (Whitfield, Barr & Calloway) will likely argue for at least one replenishment upon cure and sustained performance. Section 2.3 has been bracketed accordingly and includes Landlord's anticipated position for discussion purposes. Recommend discussing parameters for a possible compromise (e.g., single replenishment, extended cure period, or declining cap on replenishment).

2. Guaranty Cap Amount ($1,200,000). Landlord's initial draft lease sought an unlimited parent guaranty. The MCB/Halcyon Ridge position is a limited guaranty capped at twelve (12) months of Year 1 Annual Base Rent ($100,000/month × 12 = $1,200,000). This remains a key open business point. Landlord may counter with a cap equal to twenty-four (24) months of base rent or a cap that encompasses additional rent and operating expenses. Recommend holding firm at twelve (12) months of base rent only.

3. Burn-Off Threshold ($75,000,000 Net Worth). Landlord may seek a higher net worth threshold (e.g., $100,000,000 or $125,000,000) or additional conditions to the burn-off (e.g., minimum number of years of Lease term elapsed, no prior defaults, minimum credit rating). The MCB/Halcyon Ridge position is as drafted: $75,000,000 net worth for two consecutive fiscal quarters with no additional conditions beyond the absence of an existing Event of Default.

4. Burn-Off Certification Mechanism. Landlord may object to the use of Tenant's own auditor (Ashford & Whitmore CPAs LLP) and may request that the certification be issued by a mutually agreed independent auditor or by Landlord's own auditor. The MCB/Halcyon Ridge position is that Tenant's auditor (as a nationally recognized firm) is appropriate, with Landlord having a thirty (30) day review period to object to the certification. A possible compromise would be to permit Landlord to engage its own auditor at Landlord's expense to verify the net worth figures within the review period.

5. Financial Reporting Covenant (Section 8.3). Landlord may seek quarterly financial reporting rather than annual reporting. The MCB/Halcyon Ridge position is annual reporting only, upon Landlord's request and not more than once per fiscal year. Quarterly reporting is overly burdensome and inconsistent with market practice for limited guaranties of this nature and size.

6. Premises Size / Rent Adjustment. If the pending site plan revision results in a reduced Premises size (from 297,500 SF to approximately 273,500 SF) with a corresponding reduction in Annual Base Rent, the Guaranty Cap should be recalculated to reflect twelve (12) months of the revised Year 1 Annual Base Rent. This adjustment has not yet been reflected in the draft because the rent adjustment has not been agreed upon. Once the revised rent is finalized, the Guaranty Cap figure in Section 1.1(e) and throughout the document should be updated accordingly.

7. Merger/Dissolution Restrictions (Section 8.4). The restrictions on merger, consolidation, and dissolution in Section 8.4 may need to be coordinated with Halcyon Ridge Capital Partners, LP's anticipated portfolio restructuring and/or exit planning. Recommend discussing with Martin Solberg (Halcyon Ridge) whether any specific carve-outs or flexibility should be built into this provision to accommodate foreseeable transactions. Consider whether a permitted transfer basket or a pre-approved successor entity concept would be appropriate.

Calderwood & Harkness LLP

LIMITED GUARANTY OF LEASE
Meridian Holdings Inc., as Guarantor, in favor of Stonebridge Industrial Realty Trust, LP, as Landlord
[____], 2022
Reference: Lease Agreement dated as of [________________], 2022, between Stonebridge Industrial Realty Trust, LP, a Maryland limited partnership ("Landlord"), and Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), for premises known as Building 4, Cranbury Commerce Center, 200 Prospect Plains Road, Cranbury, New Jersey 08512 (Block 24, Lot 17.04, Township of Cranbury, Middlesex County, New Jersey)
LIMITED GUARANTY OF LEASE
THIS LIMITED GUARANTY OF LEASE (this "Guaranty") is made and entered into as of [____], 2022, by MERIDIAN HOLDINGS INC., a Delaware corporation ("Guarantor"), in favor of STONEBRIDGE INDUSTRIAL REALTY TRUST, LP, a Maryland limited partnership ("Landlord").
RECITALS
A. The Lease. Landlord and Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), have entered into (or are concurrently entering into) that certain Lease Agreement dated as of [____], 2022 (as the same may be amended, modified, supplemented, or restated from time to time, the "Lease") for approximately 297,500 rentable square feet (comprised of approximately 285,000 square feet of warehouse/distribution space and approximately 12,500 square feet of finished office/mezzanine space) at the premises commonly known as Building 4, Cranbury Commerce Center, located at 200 Prospect Plains Road, Cranbury, New Jersey 08512 (the "Premises"). The Lease provides for an initial term of ten (10) years, commencing on the date set forth therein.
B. Relationship of Guarantor to Tenant. Guarantor is a Delaware corporation and the direct parent entity of Tenant. Guarantor is itself majority-owned by Halcyon Ridge Capital Partners, LP, a Delaware limited partnership. The registered agent of Guarantor is c/o Cascade Systems, 1209 Orange Street, Wilmington, Delaware 19801. Guarantor's Employer Identification Number is 83-2460917.
C. Inducement; Consideration. Landlord has required, as a material condition to entering into the Lease, that Guarantor execute and deliver this Guaranty in favor of Landlord. Guarantor acknowledges that it will derive substantial direct and indirect economic benefit from the transactions contemplated by the Lease, including, without limitation, by reason of Guarantor's ownership interest in Tenant. Guarantor further acknowledges and agrees that Guarantor's execution and delivery of this Guaranty is a material inducement to Landlord's willingness to enter into the Lease with Tenant, and that Landlord would not have entered into the Lease absent Guarantor's execution and delivery of this Guaranty.
D. Capitalized Terms. All capitalized terms used and not otherwise defined in this Guaranty shall have the respective meanings ascribed to such terms in the Lease.
NOW, THEREFORE, in consideration of the foregoing recitals (which are incorporated herein by this reference), the execution and delivery of the Lease by Landlord, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor hereby agrees as follows:
ARTICLE 1 DEFINITIONS
Section 1.1 Defined Terms. As used in this Guaranty, the following terms shall have the meanings set forth below:
(a) "Burn-Off Date" means the date on which the Guarantor Net Worth Condition has been satisfied in accordance with, and as more fully described in, Section 6.1 and Section 6.2 of this Guaranty, and on which this Guaranty terminates in accordance with Article 6.
(b) "Guaranteed Obligations" means all obligations of Tenant under the Lease, whether monetary or non-monetary in nature, as more fully described in Section 2.1 of this Guaranty, subject in all cases to the Guaranty Cap as set forth in Section 2.2.
(c) "Guarantor" means Meridian Holdings Inc., a Delaware corporation, together with its permitted successors and assigns.
(d) "Guarantor Net Worth Condition" means the condition described in Section 6.1 of this Guaranty, being the achievement and maintenance by Tenant of a net worth of not less than Seventy-Five Million Dollars ($75,000,000) for two (2) consecutive fiscal quarters, as certified by the Independent Auditor in accordance with Article 6.
(e) "Guaranty Cap" means One Million Two Hundred Thousand Dollars ($1,200,000), which amount is equal to twelve (12) months of the Year 1 Annual Base Rent under the Lease (the Year 1 Annual Base Rent being One Million Two Hundred Thousand Dollars ($1,200,000), with monthly base rent of One Hundred Thousand Dollars ($100,000)), subject to the terms and conditions of Section 2.2 and Section 2.3 hereof.
(f) "Independent Auditor" means Ashford & Whitmore CPAs LLP, or such other nationally or regionally recognized independent certified public accounting firm as may be reasonably acceptable to Landlord.
(g) "Landlord" means Stonebridge Industrial Realty Trust, LP, a Maryland limited partnership, managed by its general partner, Stonebridge Industrial GP LLC, a Maryland limited liability company, with its principal office at 100 International Drive, Suite 600, Baltimore, Maryland 21202, together with its successors and assigns.
(h) "Lease" means that certain Lease Agreement described in Recital A above, as the same may be amended, modified, supplemented, or restated from time to time.
(i) "Tenant" means Meridian Consumer Brands LLC, a Delaware limited liability company, with its principal office and headquarters at 450 Park Avenue, 18th Floor, New York, New York 10022 (Employer Identification Number: 83-2461058).
ARTICLE 2 GUARANTY; GUARANTY CAP
Section 2.1 Guaranty of Obligations. Guarantor hereby absolutely, unconditionally, and irrevocably guarantees to Landlord the full and punctual payment and performance by Tenant of all obligations of Tenant arising under the Lease (collectively, the "Guaranteed Obligations"). The Guaranteed Obligations include, without limitation: (a) all monetary obligations of Tenant under the Lease, including, without limitation, Annual Base Rent, additional rent, Tenant's share of operating expenses, Tenant's share of real estate taxes, insurance costs, common area maintenance charges, utility charges, late charges, interest on overdue amounts, and all other sums of whatever nature payable by Tenant to Landlord under the Lease; (b) all obligations of Tenant to pay damages, costs, or expenses arising out of or in connection with any breach or default by Tenant under the Lease, including, without limitation, any holdover rent obligations, restoration costs, and indemnification obligations; and (c) all non-monetary performance obligations of Tenant under the Lease, including, without limitation, maintenance, repair, surrender, insurance, and compliance obligations. The foregoing notwithstanding, Guarantor's aggregate liability under this Guaranty shall in no event exceed the Guaranty Cap as set forth in Section 2.2 below.
Section 2.2 Limitation on Liability; Guaranty Cap. Notwithstanding anything to the contrary contained in this Guaranty, Guarantor's aggregate liability under this Guaranty shall not exceed the Guaranty Cap. The Guaranty Cap is One Million Two Hundred Thousand Dollars ($1,200,000), which represents twelve (12) months of the Year 1 Annual Base Rent under the Lease (calculated as One Hundred Thousand Dollars ($100,000) per month multiplied by twelve (12) months). The Guaranty Cap is a cap on aggregate cumulative liability of Guarantor under this Guaranty, and is not a per-claim cap, a per-annum cap, or a cap that resets or renews at any time during the term of this Guaranty. Once payments or expenditures made by or on behalf of Guarantor under this Guaranty equal One Million Two Hundred Thousand Dollars ($1,200,000) in the aggregate, Guarantor shall have no further obligation, liability, or responsibility under this Guaranty, and this Guaranty shall thereupon automatically terminate and be of no further force or effect (subject to the provisions of Section 2.3 below, if applicable, and subject to Section 6.4 with respect to pre-termination obligations).
Section 2.3 [Replenishment of Guaranty Cap.
[NOTE: THIS SECTION 2.3 IS BRACKETED AND REMAINS AN OPEN NEGOTIATION POINT. THE FOLLOWING REPRESENTS LANDLORD'S ANTICIPATED POSITION. CALDERWOOD & HARKNESS LLP'S POSITION ON BEHALF OF MERIDIAN CONSUMER BRANDS LLC AND HALCYON RIDGE CAPITAL PARTNERS, LP IS THAT THIS SECTION SHOULD BE DELETED IN ITS ENTIRETY AND THAT THERE SHOULD BE NO REPLENISHMENT OF THE GUARANTY CAP. IF THE GUARANTY CAP IS EXHAUSTED, THE GUARANTY SHOULD TERMINATE PERMANENTLY.]
[In the event that Guarantor shall have made payments to Landlord under this Guaranty equal to all or any portion of the Guaranty Cap, and Tenant shall subsequently cure the applicable default(s) and resume performance of its obligations under the Lease for a period of not less than [twelve (12)] consecutive months following such cure, the Guaranty Cap shall be replenished to its original amount of $1,200,000, and Guarantor's obligations hereunder shall be reinstated in full. For the avoidance of doubt, the maximum number of times the Guaranty Cap may be replenished during the term of this Guaranty is [________].]
[END OF BRACKETED PROVISION]
Section 2.4 Guaranty as Primary Obligation. This Guaranty is a guaranty of payment and performance and not merely a guaranty of collection. Landlord shall not be required to exhaust any right, remedy, or recourse against Tenant, any security deposit (including, without limitation, the Three Hundred Thousand Dollar ($300,000) irrevocable standby letter of credit issued by Harborview National Bank, N.A., as may be required under the Lease), any subtenant, any assignee, or any other person or entity, or to exhaust any right, remedy, or recourse with respect to any collateral, security, or other guaranty, before proceeding against Guarantor under this Guaranty. Guarantor agrees that, as between Guarantor and Landlord, the obligations of Tenant under the Lease may be declared to be forthwith due and payable as provided therein for purposes of this Guaranty, notwithstanding any stay, injunction, or other prohibition preventing such declaration as against Tenant, and that in the event of such declaration (or if such declaration is deemed to have been made), such obligations shall immediately become due and payable by Guarantor for purposes of this Guaranty.
ARTICLE 3 ABSOLUTE AND UNCONDITIONAL NATURE OF GUARANTY
Section 3.1 Unconditional Obligation. The obligations of Guarantor under this Guaranty are absolute, unconditional, and irrevocable, and shall remain in full force and effect until the earlier of (i) the termination of this Guaranty pursuant to Section 2.2 (exhaustion of the Guaranty Cap), (ii) the termination of this Guaranty pursuant to Article 6 (satisfaction of the Guarantor Net Worth Condition), or (iii) the expiration or earlier termination of the Lease and the full payment, performance, and satisfaction of all Guaranteed Obligations. Without limiting the generality of the foregoing, Guarantor's obligations hereunder shall not be released, diminished, impaired, reduced, or otherwise affected by any of the following, whether or not Guarantor shall have notice or knowledge thereof:
(a) any lack of validity or enforceability of the Lease or any provision thereof;
(b) any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease (subject to the limitation on the Guaranty Cap set forth in Section 3.2 below);
(c) any change in the time, manner, or place of payment or performance of any of the Guaranteed Obligations, or any change in the terms or conditions of the Lease;
(d) any exchange, release, surrender, impairment, or non-perfection of any collateral, security deposit, letter of credit, or other security for any of the Guaranteed Obligations;
(e) any change in the corporate or organizational structure of Tenant, whether by merger, consolidation, dissolution, reorganization, recapitalization, conversion, change of name, change of ownership, or otherwise;
(f) any assignment or subletting by Tenant of all or any portion of the Premises or Tenant's interest under the Lease, whether or not consented to by Landlord, and whether or not in accordance with the terms of the Lease;
(g) any bankruptcy, insolvency, reorganization, arrangement, adjustment, composition, receivership, liquidation, dissolution, or similar proceeding commenced by or against Tenant, including, without limitation, any proceeding under Title 11 of the United States Code (the Bankruptcy Code), or any comparable federal, state, or foreign law, and any discharge, stay, or injunction granted in or arising from any such proceeding;
(h) any failure of Landlord to file or enforce a claim against Tenant or the estate of Tenant (in any bankruptcy or other proceeding) or any other person or entity;
(i) any defense that may at any time be available to Tenant, whether based upon the statute of frauds, the statute of limitations, accord and satisfaction, laches, estoppel, waiver, or any other legal or equitable doctrine;
(j) any release or discharge of Tenant from the performance or observance of any obligation under the Lease resulting from any operation of law, including, without limitation, any discharge in bankruptcy; and
(k) any other circumstance, event, or condition (whether or not similar to any of the foregoing) that might otherwise constitute a legal or equitable defense available to, or constitute a discharge of, a guarantor or surety.
Section 3.2 Continuation Notwithstanding Modifications to Lease. This Guaranty shall remain in full force and effect notwithstanding any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease, whether or not made with or without Guarantor's knowledge or consent. Notwithstanding the foregoing, in the event that any amendment, modification, supplement, or restatement of the Lease increases the monetary obligations of Tenant beyond the original monetary obligations set forth in the Lease as of the date hereof, the Guaranty Cap shall not be increased by reason of any such increase in Tenant's monetary obligations without Guarantor's express prior written consent. For the avoidance of doubt, Guarantor's obligations under this Guaranty shall at no time exceed the Guaranty Cap, as such cap may be adjusted only with Guarantor's express prior written consent.
Section 3.3 No Conditions Precedent. There are no conditions precedent to the enforcement of this Guaranty by Landlord other than the occurrence of a default by Tenant under the Lease. Without limiting the foregoing, Landlord shall not be required to provide any notice to Guarantor of Tenant's default as a condition to exercising Landlord's rights under this Guaranty, except to the extent that Landlord is required by applicable law to provide notice of Guarantor's obligations hereunder prior to commencing legal proceedings against Guarantor.
ARTICLE 4 WAIVER OF DEFENSES
Section 4.1 Waiver of Suretyship Defenses. Guarantor hereby waives, to the fullest extent permitted by applicable law, each and every one of the following rights, defenses, and benefits:
(a) diligence, presentment, demand of payment, filing of claims with any court, protest, and notice of dishonor or of any default by Tenant under the Lease;
(b) notice of acceptance of this Guaranty by Landlord, it being acknowledged that this Guaranty shall be deemed accepted by Landlord upon Landlord's execution of the Lease;
(c) notice of any default or Event of Default by Tenant under the Lease;
(d) notice of any amendment, modification, supplement, restatement, renewal, extension, or replacement of the Lease;
(e) any defense arising by reason of any disability, lack of authority, or other defense of Tenant, or by reason of the cessation or limitation of the liability of Tenant from any cause other than full and complete payment and performance of the Guaranteed Obligations;
(f) all defenses based upon suretyship or impairment of collateral, including, without limitation, all defenses that Guarantor may at any time assert under the laws of the State of New York, the State of New Jersey, the State of Delaware, or any other applicable jurisdiction relating to the rights and obligations of sureties and guarantors;
(g) the benefit of any statute of limitations affecting Guarantor's liability under this Guaranty or the enforcement thereof, to the extent permitted by applicable law;
(h) any right to require Landlord to proceed against Tenant or any other person or entity, or to pursue any other remedy in Landlord's power, before proceeding against Guarantor under this Guaranty;
(i) any right to require Landlord to apply any security deposit held under the Lease, or to draw upon or apply the proceeds of any letter of credit (including, without limitation, the irrevocable standby letter of credit issued by Harborview National Bank, N.A.), before demanding payment or performance from Guarantor under this Guaranty; and
(j) any other defense, right, or benefit that may be available to Guarantor in its capacity as a guarantor or surety under any applicable law.
Section 4.2 Waiver of Subrogation. Until such time as all Guaranteed Obligations have been fully paid, performed, and satisfied, and the Lease has expired or been terminated (and all obligations thereunder have been fully satisfied), Guarantor hereby waives any and all rights of subrogation, reimbursement, indemnification, exoneration, or contribution that Guarantor may now or hereafter have against Tenant, any co-guarantor, or any other person or entity, and any right to enforce any remedy that Landlord now has or may hereafter have against Tenant or any other person or entity, and any benefit of, or any right to participate in, any security or collateral given to or for the benefit of Landlord to secure payment or performance of any of the Guaranteed Obligations. Guarantor agrees that, to the extent that any such waiver of subrogation rights is not enforceable under applicable law, any such rights of subrogation shall in all respects be subordinate and junior to the rights of Landlord under this Guaranty and under the Lease.
ARTICLE 5 LANDLORD'S RIGHTS
Section 5.1 Direct Proceeding Against Guarantor. Landlord may, in its sole and absolute discretion, proceed directly and immediately against Guarantor under this Guaranty upon or at any time after the occurrence of a default by Tenant under the Lease, without first pursuing any remedy or right against Tenant, without first making any demand upon Tenant, without first applying any security deposit or letter of credit proceeds, and without first exhausting any other right, remedy, or recourse against Tenant, any subtenant, any assignee, or any other person or entity. Guarantor agrees and acknowledges that this Guaranty is a guaranty of payment and performance and not merely a guaranty of collection, and that Landlord's rights hereunder are independent of, and not contingent upon, Landlord's pursuit of any other remedy.
Section 5.2 No Obligation to Enforce Against Tenant First. Landlord shall have no obligation to make any demand upon, or pursue any claim, right, or remedy against, Tenant or any other person or entity, or to exhaust any security or collateral, before, concurrently with, or as a condition precedent to, making any demand upon or pursuing any claim, right, or remedy against Guarantor under this Guaranty. Landlord may pursue its rights and remedies against Guarantor and Tenant simultaneously, sequentially, or in any order that Landlord may elect in its sole and absolute discretion.
Section 5.3 Landlord's Right to Deal with Lease. Landlord may, at any time and from time to time, without notice to or the consent of Guarantor, and without in any way releasing, diminishing, impairing, or otherwise affecting the obligations of Guarantor hereunder:
(a) grant to Tenant one or more extensions of time for the payment or performance of any of the Guaranteed Obligations;
(b) accept partial payments from Tenant on account of the Guaranteed Obligations;
(c) settle or compromise any of the Guaranteed Obligations or any claim or dispute arising out of or in connection therewith;
(d) release, substitute, or add any one or more guarantors of the Guaranteed Obligations;
(e) release Tenant from, or waive compliance by Tenant with, any of the terms, covenants, conditions, or obligations of the Lease;
(f) modify, amend, supplement, restate, renew, extend, or replace any of the terms, covenants, conditions, or obligations of the Lease (subject to the limitation on the Guaranty Cap set forth in Section 3.2 of this Guaranty); and
(g) take or refrain from taking any other action that might otherwise constitute a legal or equitable discharge of Guarantor's obligations hereunder.
ARTICLE 6 BURN-OFF / RELEASE OF GUARANTY
Section 6.1 Guarantor Net Worth Condition. This Guaranty shall automatically terminate and be of no further force or effect (except as provided in Section 6.4 below) upon the satisfaction of all of the following conditions (collectively, the "Guarantor Net Worth Condition"):
(a) Tenant (Meridian Consumer Brands LLC) shall have achieved and maintained a net worth (defined as total assets minus total liabilities, in each case as reflected on Tenant's balance sheet) of not less than Seventy-Five Million Dollars ($75,000,000) for two (2) consecutive fiscal quarters of Tenant;
(b) Such net worth shall be calculated in accordance with generally accepted accounting principles in the United States ("GAAP"), consistently applied throughout the periods involved, using the same accounting methods, policies, practices, and procedures (with consistent classifications, judgments, and estimation methodologies) as those used in the preparation of Tenant's most recent audited financial statements;
(c) Such achievement and maintenance of the required net worth shall be certified in writing by the Independent Auditor (Ashford & Whitmore CPAs LLP, or such other nationally or regionally recognized independent certified public accounting firm as may be reasonably acceptable to Landlord) in a written certification substantially in the form attached hereto as Exhibit A (the "Net Worth Certification"), which Net Worth Certification shall be delivered to Landlord in accordance with Section 6.2 below; and
(d) At the time of delivery of such Net Worth Certification to Landlord, no Event of Default (or event that, with the giving of notice, the lapse of time, or both, would constitute an Event of Default) shall exist under the Lease.
Section 6.2 Delivery of Certification; Landlord Review Period. Tenant or Guarantor shall deliver to Landlord a written certification from the Independent Auditor confirming the satisfaction of the Guarantor Net Worth Condition (the Net Worth Certification), together with copies of the relevant quarterly financial statements of Tenant for the applicable two (2) consecutive fiscal quarters and such other supporting documentation as may be reasonably necessary to evidence satisfaction of the Guarantor Net Worth Condition. Landlord shall have a period of thirty (30) days following receipt of such Net Worth Certification and supporting documentation (the "Review Period") within which to review the Net Worth Certification and to object to the same. Any objection by Landlord must be in writing, must be delivered to Guarantor (or Tenant, as applicable) within the Review Period, and must set forth with reasonable specificity the grounds for such objection. If Landlord does not timely deliver a written objection within the Review Period, the Guarantor Net Worth Condition shall be deemed to have been satisfied, and this Guaranty shall terminate effective as of the last day of such thirty (30) day Review Period (such date being the "Burn-Off Date"). In the event that Landlord timely delivers a written objection, the parties shall work together in good faith to resolve such objection, and the Guaranty shall remain in full force and effect until the Guarantor Net Worth Condition is ultimately satisfied in accordance with this Article 6.
Section 6.3 Return of Guaranty. Upon termination of this Guaranty pursuant to this Article 6, Landlord shall execute and deliver to Guarantor a written release and termination of this Guaranty, in form and substance reasonably satisfactory to Guarantor, within fifteen (15) business days following the effective date of termination (the Burn-Off Date). Landlord's failure to execute and deliver such release and termination within such period shall not affect the termination of this Guaranty, which termination shall be effective automatically upon the Burn-Off Date as provided in Section 6.2.
Section 6.4 Survival of Pre-Termination Obligations. The termination of this Guaranty pursuant to this Article 6 shall not release, diminish, impair, or otherwise affect Guarantor's liability for any Guaranteed Obligations that arose prior to the effective date of termination (the Burn-Off Date), subject in all cases to the Guaranty Cap. For the avoidance of doubt, Guarantor shall remain liable for any Guaranteed Obligations that accrued or arose prior to the Burn-Off Date, even if a claim with respect thereto is asserted by Landlord after the Burn-Off Date, provided that the aggregate amount recovered from Guarantor under this Guaranty (whether before or after the Burn-Off Date) shall not exceed the Guaranty Cap.
ARTICLE 7 REPRESENTATIONS AND WARRANTIES OF GUARANTOR
Guarantor hereby represents and warrants to Landlord as of the date hereof as follows:
Section 7.1 Organization and Good Standing. Guarantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. Guarantor has all requisite corporate power and authority to own, lease, and operate its properties and to carry on its business as now being conducted.
Section 7.2 Authority. Guarantor has full corporate power and authority to execute, deliver, and perform its obligations under this Guaranty. The execution and delivery of this Guaranty and the performance by Guarantor of its obligations hereunder have been duly authorized by all necessary corporate action on the part of Guarantor, including, without limitation, any required approval of Guarantor's board of directors or shareholders. No other corporate proceedings or approvals on the part of Guarantor are necessary to authorize the execution, delivery, and performance of this Guaranty.
Section 7.3 Enforceability. This Guaranty constitutes the legal, valid, and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or similar laws affecting creditors' rights and remedies generally, and (b) general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 7.4 No Conflicts. The execution, delivery, and performance by Guarantor of this Guaranty do not and will not (a) violate or conflict with the certificate of incorporation, bylaws, or other organizational documents of Guarantor, (b) violate or conflict with any applicable law, statute, rule, regulation, order, judgment, decree, or injunction of any court or governmental authority to which Guarantor is subject, or (c) result in a breach of, or constitute a default under, or require any consent under, any material contract, agreement, indenture, or other instrument to which Guarantor is a party or by which Guarantor or any of its assets may be bound.
Section 7.5 No Litigation. No litigation, arbitration, investigation, or governmental proceeding is pending or, to Guarantor's knowledge after reasonable inquiry, threatened against Guarantor that would reasonably be expected to materially adversely affect Guarantor's ability to perform its obligations under this Guaranty or that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Guaranty.
Section 7.6 Financial Condition. Guarantor has received adequate and sufficient consideration for the execution and delivery of this Guaranty. Guarantor is not insolvent (as defined under applicable federal or state law) and will not be rendered insolvent by the execution and delivery of this Guaranty or the performance of Guarantor's obligations hereunder. Guarantor is not engaged or about to engage in any business or transaction for which the property remaining with Guarantor is an unreasonably small capital, and Guarantor does not intend to incur, and does not believe that it will incur, debts beyond its ability to pay as they become due.
ARTICLE 8 COVENANTS OF GUARANTOR
Guarantor hereby covenants and agrees with Landlord as follows:
Section 8.1 Maintenance of Existence. During the term of this Guaranty, Guarantor shall maintain its corporate existence and good standing under the laws of the State of Delaware, and shall maintain all qualifications, licenses, and permits necessary for the conduct of its business, except where the failure to maintain such qualifications, licenses, or permits would not reasonably be expected to have a material adverse effect on Guarantor's ability to perform its obligations under this Guaranty.
Section 8.2 Notice of Material Adverse Change. Guarantor shall notify Landlord in writing within thirty (30) days of the occurrence of any material adverse change in Guarantor's financial condition. For purposes of this Section 8.2, a "material adverse change" shall include, without limitation, (a) any decrease in Guarantor's net worth by more than twenty-five percent (25%) from the net worth reflected in the most recent financial statements delivered to Landlord, (b) the commencement of any bankruptcy, insolvency, reorganization, receivership, or similar proceeding by or against Guarantor, (c) the entry of any material judgment or order against Guarantor, and (d) any other event or condition that would reasonably be expected to materially impair Guarantor's ability to perform its obligations under this Guaranty.
Section 8.3 Financial Reporting. Upon Landlord's reasonable written request (which request shall not be made more than once per fiscal year of Guarantor), Guarantor shall deliver to Landlord financial statements of Guarantor (including, at a minimum, a balance sheet and statement of income and expenses, prepared in accordance with GAAP, consistently applied) within ninety (90) days after the end of each fiscal year of Guarantor for which such request is made. Such financial statements shall be certified by Guarantor's chief financial officer or by the Independent Auditor as presenting fairly, in all material respects, the financial position of Guarantor as of the date thereof and the results of Guarantor's operations for the period then ended, in accordance with GAAP. Any financial statements delivered to Landlord pursuant to this Section 8.3 shall be subject to the confidentiality restrictions set forth in Section 11.10 of this Guaranty, and Landlord shall not disclose such financial statements or any information contained therein to any person or entity other than Landlord's lender(s), legal counsel, and accountants, except as required by applicable law or court order.
Section 8.4 Merger/Dissolution Restrictions. Guarantor shall not dissolve, liquidate, or wind up its affairs, or merge with or consolidate into any other entity (whether or not Guarantor is the surviving entity), unless the following conditions are satisfied: (a) the surviving or successor entity (if other than Guarantor) shall expressly assume all of Guarantor's obligations under this Guaranty pursuant to a written instrument in form and substance reasonably satisfactory to Landlord, executed and delivered to Landlord contemporaneously with or prior to the consummation of such transaction; and (b) the surviving or successor entity shall have a net worth (calculated in accordance with GAAP) at the time of consummation of such transaction at least equal to the net worth of Guarantor immediately prior to such transaction. For the avoidance of doubt, a transfer of the equity interests of Guarantor (including, without limitation, any sale, transfer, or disposition by Halcyon Ridge Capital Partners, LP of its ownership interest in Guarantor) shall not constitute a merger, consolidation, dissolution, or liquidation of Guarantor for purposes of this Section 8.4; provided, however, that any such transfer shall not release or diminish Guarantor's obligations under this Guaranty.
ARTICLE 9 REMEDIES
Section 9.1 Cumulative Remedies. The rights and remedies of Landlord under this Guaranty are cumulative and are in addition to, and not in substitution for, all other rights and remedies available to Landlord under the Lease, at law, in equity, or otherwise. Without limiting the generality of the foregoing, Landlord's exercise of any right or remedy under the Lease shall not preclude Landlord from exercising any right or remedy under this Guaranty, and Landlord's exercise of any right or remedy under this Guaranty shall not preclude Landlord from exercising any right or remedy under the Lease, at law, in equity, or otherwise.
Section 9.2 No Waiver. No failure or delay by Landlord in exercising any right, power, or remedy under this Guaranty shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. No waiver of any provision of this Guaranty shall be effective unless made in a writing signed by Landlord, and no such waiver shall constitute a waiver of any other provision of this Guaranty or a continuing waiver of the same provision.
Section 9.3 Costs of Enforcement. In the event that Landlord prevails in any action, suit, or proceeding to enforce this Guaranty or any provision hereof (including, without limitation, any action to collect any amount due hereunder), Guarantor shall pay to Landlord all of Landlord's reasonable and documented attorneys' fees, costs, and expenses incurred in connection with such action, suit, or proceeding, including, without limitation, fees and costs incurred at the trial and appellate levels and in any bankruptcy or insolvency proceeding. Any amounts payable by Guarantor pursuant to this Section 9.3 shall be subject to the Guaranty Cap and shall be counted against the Guaranty Cap for purposes of determining whether the aggregate cap has been reached under Section 2.2.
ARTICLE 10 NOTICES
Section 10.1 Notice Provisions. All notices, demands, requests, consents, approvals, and other communications required or permitted to be given under this Guaranty shall be in writing and shall be deemed to have been duly given (a) when delivered personally (with written confirmation of receipt), (b) one (1) business day after deposit with a nationally recognized overnight courier service (such as Sundial Data Systems or Harborline Partners LLC), postage or fees prepaid, for next business day delivery, or (c) three (3) business days after deposit in the United States mail, certified mail, return receipt requested, postage prepaid, in each case addressed as follows:
If to Guarantor:
Meridian Holdings Inc. c/o Meridian Consumer Brands LLC 450 Park Avenue, 18th Floor New York, New York 10022
Attention: Kevin Driscoll, Vice President, Supply Chain & Logistics
With a copy (which shall not constitute notice) to:
Halcyon Ridge Capital Partners, LP 599 Lexington Avenue, 34th Floor New York, New York 10022
Attention: Martin Solberg, Principal
And a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP 1285 Avenue of the Americas, 40th Floor New York, New York 10019
Attention: Angela Fontaine, Esq.
If to Landlord:
Stonebridge Industrial Realty Trust, LP 100 International Drive, Suite 600 Baltimore, Maryland 21202
Attention: Rebecca Hartwell, Senior Vice President, Leasing
With a copy (which shall not constitute notice) to:
Whitfield, Barr & Calloway LLP 1700 Market Street, Suite 3200 Philadelphia, Pennsylvania 19103
Attention: Thomas R. Calloway, Esq.
Section 10.2 Change of Address. Either party may change its address for notices and other communications under this Guaranty by giving written notice of such change to the other party in accordance with the provisions of this Section 10.1. Any such change of address shall be effective upon receipt of such notice by the other party.
ARTICLE 11 GENERAL PROVISIONS
Section 11.1 Governing Law. This Guaranty shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice-of-law or conflicts-of-law rules, provisions, or principles (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York.
Section 11.2 Jurisdiction and Venue. Guarantor hereby irrevocably and unconditionally submits to the exclusive jurisdiction of (a) the courts of the State of New York located in the County of New York (Borough of Manhattan) and (b) the United States District Court for the Southern District of New York, for the purposes of any action, suit, or proceeding arising out of or relating to this Guaranty or any transaction contemplated hereby. Guarantor hereby irrevocably and unconditionally waives any objection that it may now or hereafter have to the laying of venue of any such action, suit, or proceeding in any such court, and any claim that any such action, suit, or proceeding has been brought in an inconvenient forum. Guarantor agrees that a final judgment in any such action, suit, or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable law.
Section 11.3 Waiver of Jury Trial. GUARANTOR AND LANDLORD EACH HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, STATUTE, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS GUARANTY, THE LEASE, OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY ACKNOWLEDGES AND AGREES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO THE OTHER PARTY'S ENTERING INTO THIS GUARANTY AND THAT EACH PARTY HAS BEEN REPRESENTED BY LEGAL COUNSEL IN CONNECTION WITH THIS WAIVER.
Section 11.4 Entire Agreement. This Guaranty constitutes the entire agreement between Guarantor and Landlord with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, representations, and warranties, whether written or oral, with respect to the subject matter hereof. No representation, warranty, promise, inducement, or statement of intention has been made by either party that is not embodied in this Guaranty, and neither party shall be bound by or liable for any alleged representation, warranty, promise, inducement, or statement of intention not so set forth.
Section 11.5 Amendments. This Guaranty may not be amended, modified, supplemented, or restated except by a written instrument executed by both Guarantor and Landlord. No oral agreement, course of dealing, or trade usage shall serve to amend, modify, or waive any provision of this Guaranty.
Section 11.6 Successors and Assigns. This Guaranty shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Landlord and its successors and assigns. Landlord may freely assign this Guaranty, without the consent of Guarantor, in connection with any sale, transfer, or other disposition of Landlord's interest in the Lease, the Premises, or the property of which the Premises form a part, and upon any such assignment, the assignee shall succeed to all of Landlord's rights under this Guaranty. Guarantor may not assign, delegate, or otherwise transfer any of its obligations or liabilities under this Guaranty without the prior written consent of Landlord, which consent may be withheld in Landlord's sole and absolute discretion. Any purported assignment by Guarantor in violation of this Section 11.6 shall be null and void and of no force or effect.
Section 11.7 Severability. If any provision of this Guaranty is held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Guaranty, and this Guaranty shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. The parties agree that any such invalid, illegal, or unenforceable provision shall be reformed to the minimum extent necessary to make such provision valid, legal, and enforceable while preserving the intent of the parties.
Section 11.8 Counterparts. This Guaranty may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original, and all of which counterparts taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Guaranty by facsimile or electronic transmission (including portable document format (.pdf)) shall be effective as delivery of a manually executed counterpart of this Guaranty.
Section 11.9 Interpretation. The headings and captions used in this Guaranty are for convenience of reference only and shall not affect the interpretation or construction of this Guaranty. Unless the context otherwise requires, (a) references to "Sections" and "Articles" refer to Sections and Articles of this Guaranty, (b) references to the Lease shall include all amendments, modifications, supplements, and restatements thereof, (c) the words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation," (d) the words "herein," "hereof," "hereby," "hereunder," and words of similar import refer to this Guaranty as a whole and not to any particular provision hereof, and (e) references to any law, statute, rule, or regulation shall be deemed to include all amendments and successor provisions thereto.
Section 11.10 Confidentiality. Landlord shall maintain the confidentiality of all financial statements, financial information, and other non-public information of Guarantor delivered to Landlord pursuant to this Guaranty (collectively, "Guarantor Confidential Information"), and shall not disclose any Guarantor Confidential Information to any person or entity, except to (a) Landlord's lender(s) and prospective lender(s), provided that such lender(s) agree to maintain the confidentiality thereof, (b) Landlord's legal counsel, (c) Landlord's accountants, (d) Landlord's partners, members, directors, officers, and employees who have a need to know such information in connection with the administration of the Lease and this Guaranty, or (e) as required by applicable law, regulation, judicial process, or court order (provided that Landlord shall use commercially reasonable efforts to provide Guarantor with prompt notice of any such requirement prior to disclosure, to the extent permitted by law). The obligations of Landlord under this Section 11.10 shall survive the termination or expiration of this Guaranty.
Section 11.11 Relationship to Lease. This Guaranty is an ancillary document to the Lease and is being executed and delivered in connection with the Lease. In the event of any conflict or inconsistency between the terms and provisions of this Guaranty and the terms and provisions of the Lease with respect to Guarantor's obligations hereunder, the terms and provisions of this Guaranty shall control and govern. Nothing contained in this Guaranty shall be construed to amend, modify, or otherwise affect the terms of the Lease as between Landlord and Tenant.
IN WITNESS WHEREOF, Guarantor has duly executed and delivered this Limited Guaranty of Lease as of the date first written above.
GUARANTOR:
MERIDIAN HOLDINGS INC., a Delaware corporation
By: ________
Name: [________]
Title: [________]
Date: [________]
ACCEPTED AND ACKNOWLEDGED BY LANDLORD:
STONEBRIDGE INDUSTRIAL REALTY TRUST, LP, a Maryland limited partnership
By: Stonebridge Industrial GP LLC,
a Maryland limited liability company, its General Partner
By: ________
Name: [________]
Title: [________]
Date: [________]
EXHIBIT A
FORM OF INDEPENDENT AUDITOR CERTIFICATION (Guarantor Net Worth Condition / Burn-Off)
[Ashford & Whitmore CPAs LLP Letterhead] 750 Third Avenue, 22nd Floor New York, New York 10017
[Date]
Stonebridge Industrial Realty Trust, LP 100 International Drive, Suite 600 Baltimore, Maryland 21202
Attention: Rebecca Hartwell, Senior Vice President, Leasing
Re: Net Worth Certification — Meridian Consumer Brands LLC Limited Guaranty of Lease dated [____], 2022, by Meridian Holdings Inc. in favor of Stonebridge Industrial Realty Trust, LP (the "Guaranty")
Ladies and Gentlemen:
We have been engaged by Meridian Consumer Brands LLC, a Delaware limited liability company ("Tenant"), and Meridian Holdings Inc., a Delaware corporation ("Guarantor"), to provide this certification in connection with the Guaranty referenced above. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Guaranty.
We have reviewed the unaudited quarterly financial statements of Tenant for the fiscal quarters ending [___] and [___] (collectively, the "Review Periods"), and have performed such additional procedures as we considered necessary in the circumstances, in accordance with the attestation standards established by the American Institute of Certified Public Accountants.
Based upon our review, we hereby certify as follows:
1.  The net worth of Tenant (calculated as total assets minus total liabilities) as of the end of the fiscal quarter ending [___] was $[___], which is not less than Seventy-Five Million Dollars ($75,000,000).
2.  The net worth of Tenant (calculated as total assets minus total liabilities) as of the end of the fiscal quarter ending [___] was $[___], which is not less than Seventy-Five Million Dollars ($75,000,000).
3.  Such net worth has been calculated in accordance with generally accepted accounting principles in the United States ("GAAP"), consistently applied throughout the Review Periods, using the same accounting methods, policies, practices, and procedures (with consistent classifications, judgments, and estimation methodologies) as those used in the preparation of Tenant's most recent audited annual financial statements.
4.  Accordingly, the Guarantor Net Worth Condition, as defined in Section 6.1 of the Guaranty, has been satisfied.
This certification is issued solely for the benefit of Stonebridge Industrial Realty Trust, LP, in its capacity as Landlord under the Guaranty, and may not be relied upon by any other person or entity without our prior written consent.
Very truly yours,
ASHFORD & WHITMORE CPAs LLP
By: ________
Name: [________]
Title: Partner
Date: [________]
INTERNAL DRAFTING NOTES (APPENDED TO DRAFT — NOT PART OF FINAL GUARANTY)
PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT PREPARED BY CALDERWOOD & HARKNESS LLP MATTER NO. 1011-00007
Prepared by: Cynthia Ho and Grace Nakamura, Calderwood & Harkness LLP, with review by Angela Fontaine, Esq.
Circulation: Internal to Meridian Consumer Brands LLC / Halcyon Ridge Capital Partners, LP deal team only.
Status: This draft has NOT been transmitted to Whitfield, Barr & Calloway LLP or to Stonebridge Industrial Realty Trust, LP.
Open Items Flagged for Negotiation:
1.  Section 2.3 — Replenishment of Guaranty Cap. The MCB/Halcyon Ridge position is that there should be no replenishment of the Guaranty Cap under any circumstances. Once the $1,200,000 cap is exhausted through payments made by Guarantor, the Guaranty should terminate permanently. We anticipate significant landlord push-back on this point. Landlord's counsel (Whitfield, Barr & Calloway) will likely argue for at least one replenishment upon cure and sustained performance. Section 2.3 has been bracketed accordingly and includes Landlord's anticipated position for discussion purposes. Recommend discussing parameters for a possible compromise (e.g., single replenishment, extended cure period, or declining cap on replenishment).
2.  Guaranty Cap Amount ($1,200,000). Landlord's initial draft lease sought an unlimited parent guaranty. The MCB/Halcyon Ridge position is a limited guaranty capped at twelve (12) months of Year 1 Annual Base Rent ($100,000/month × 12 = $1,200,000). This remains a key open business point. Landlord may counter with a cap equal to twenty-four (24) months of base rent or a cap that encompasses additional rent and operating expenses. Recommend holding firm at twelve (12) months of base rent only.
3.  Burn-Off Threshold ($75,000,000 Net Worth). Landlord may seek a higher net worth threshold (e.g., $100,000,000 or $125,000,000) or additional conditions to the burn-off (e.g., minimum number of years of Lease term elapsed, no prior defaults, minimum credit rating). The MCB/Halcyon Ridge position is as drafted: $75,000,000 net worth for two consecutive fiscal quarters with no additional conditions beyond the absence of an existing Event of Default.
4.  Burn-Off Certification Mechanism. Landlord may object to the use of Tenant's own auditor (Ashford & Whitmore CPAs LLP) and may request that the certification be issued by a mutually agreed independent auditor or by Landlord's own auditor. The MCB/Halcyon Ridge position is that Tenant's auditor (as a nationally recognized firm) is appropriate, with Landlord having a thirty (30) day review period to object to the certification. A possible compromise would be to permit Landlord to engage its own auditor at Landlord's expense to verify the net worth figures within the review period.
5.  Financial Reporting Covenant (Section 8.3). Landlord may seek quarterly financial reporting rather than annual reporting. The MCB/Halcyon Ridge position is annual reporting only, upon Landlord's request and not more than once per fiscal year. Quarterly reporting is overly burdensome and inconsistent with market practice for limited guaranties of this nature and size.
6.  Premises Size / Rent Adjustment. If the pending site plan revision results in a reduced Premises size (from 297,500 SF to approximately 273,500 SF) with a corresponding reduction in Annual Base Rent, the Guaranty Cap should be recalculated to reflect twelve (12) months of the revised Year 1 Annual Base Rent. This adjustment has not yet been reflected in the draft because the rent adjustment has not been agreed upon. Once the revised rent is finalized, the Guaranty Cap figure in Section 1.1(e) and throughout the document should be updated accordingly.
7.  Merger/Dissolution Restrictions (Section 8.4). The restrictions on merger, consolidation, and dissolution in Section 8.4 may need to be coordinated with Halcyon Ridge Capital Partners, LP's anticipated portfolio restructuring and/or exit planning. Recommend discussing with Martin Solberg (Halcyon Ridge) whether any specific carve-outs or flexibility should be built into this provision to accommodate foreseeable transactions. Consider whether a permitted transfer basket or a pre-approved successor entity concept would be appropriate.
Calderwood & Harkness LLP | 1285 Avenue of the Americas, 40th Floor | New York, NY 10019 Matter No. 1011-00007

LIMITED GUARANTY OF LEASE

LIMITED GUARANTY OF LEASE

RECITALS

ARTICLE 1 DEFINITIONS

ARTICLE 3 ABSOLUTE AND UNCONDITIONAL NATURE OF GUARANTY

ARTICLE 4 WAIVER OF DEFENSES

ARTICLE 5 LANDLORD'S RIGHTS

ARTICLE 6 BURN-OFF / RELEASE OF GUARANTY

ARTICLE 7 REPRESENTATIONS AND WARRANTIES OF GUARANTOR

ARTICLE 8 COVENANTS OF GUARANTOR

ARTICLE 9 REMEDIES

ARTICLE 10 NOTICES

ARTICLE 11 GENERAL PROVISIONS

GUARANTOR:

ACCEPTED AND ACKNOWLEDGED BY LANDLORD:

EXHIBIT A

Record

Parties

Dates

Amounts