Common use of Covenants of Guarantor Clause in Contracts

Covenants of Guarantor. Guarantor hereby represents and warrants to Lender that Guarantor has good title (both record and beneficial) to the Collateral, free and clear of all claims, pledges, security interests, liens or encumbrances of every nature whatsoever, and that Guarantor has the right to pledge and grant Lender the security interest in the Collateral granted under this Agreement. Guarantor agrees that, until all sums due under the Redemption Note have been paid in full, Guarantor will not: (a) sell, assign or transfer, or attempt to sell, assign or transfer, any of the Collateral, (b) grant or create, or attempt to grant or create, any security interest, lien, pledge, claim or other encumbrance with respect to any of the Collateral, (c) suffer or permit to continue upon any of the Collateral during the term of this Agreement, an attachment, levy, execution or statutory lien, (d) permit the issuance of any equity of the Company or any other security of the Company which diminishes the value, or rights and preferences of the Shares or otherwise make any change to its capitalization; or (e) amend the rights and preferences of the Shares. There shall be no substitution of collateral under the terms of this Agreement, without the prior written consent of Lender. Guarantor hereby agrees to indemnify Lender and Pledge Holder against any direct loss, reasonable cost or out-of-pocket expense incurred by holder in connection with the Redemption Note and Agreement and the exercise of any and all rights pertaining thereto, including, without limitation, all court costs, reasonable attorney’s fees and other costs of collection.