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GUARANTY AGREEMENT
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THIS GUARANTY AGREEMENT ("Guaranty") is made as of the 28th day of July,
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2005, by Guarantor (as hereinafter defined) for the benefit of Lender (as
hereinafter defined).
1. Definitions. As used in this Guaranty, the following terms shall have
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the meanings indicated below:
(a) The term "Lender" shall mean THE FROST NATIONAL BANK, a national
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banking association, whose address for notice purposes is the following:
X.X. Xxx 0000, Xxx Xxxxxxx, Xxxxx 00000
Attn: Xxxx Xxxxxx
(b) The term "Borrower" (whether one or more) shall mean the following:
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Charys Holding Company, Inc., a Delaware corporation
(c) The term "Guarantor" shall mean Berkshire Wireless, Inc., a
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Massachusetts corporation, whose address for notice purposes is the following:
000 Xxxxxxxx Xxxxxx
Xxx, Xxxxxxxxx Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx
(d) The term "Guaranteed Indebtedness" shall mean (i) all principal
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indebtedness owing by Borrower to Lender now existing or hereafter arising under
or evidenced by that one certain Promissory Note dated July 28, 2005, in the
original principal amount of $300,000.00, executed by Borrower and payable to
the order of Lender and, (ii) all accrued but unpaid interest on any of the
indebtedness described in (i) above, (iii) all obligations of Borrower to Lender
under any documents evidencing, securing, governing and/or pertaining to all or
any part of the indebtedness described in (i) and (ii) above (collectively, the
"Loan Documents"), (iv) all costs and expenses incurred by Lender in connection
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with the collection and administration of all or any part of the indebtedness
and obligations described in (i), (ii) and (iii) above or the protection or
preservation of, or realization upon, the collateral securing all or any part of
such indebtedness and obligations, including without limitation all reasonable
attorneys' fees, and (v) all renewals, extensions, modifications and
rearrangements of the indebtedness and obligations described in (i), (ii), (iii)
and (iv) above.
2. Obligations. As an inducement to Lender to extend or continue to
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extend credit and other financial accommodations to Borrower, Guarantor, for
value received, does hereby unconditionally and absolutely guarantee the prompt
and full payment and performance of the Guaranteed Indebtedness when due or
declared to be due and at all times thereafter.
3. Character of Obligations.
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(a) This is an absolute, continuing and unconditional guaranty of payment
and not of collection and if at any time or from time to time there is no
outstanding Guaranteed Indebtedness, the obligations of Guarantor with respect
to any and all Guaranteed Indebtedness incurred thereafter shall not be
affected. This Guaranty and the Guarantor's obligations hereunder are
irrevocable and, in the event of Guarantor's death, shall be binding upon
Guarantor's estate. All of the Guaranteed Indebtedness shall be conclusively
presumed to have been made or acquired in acceptance hereof. Guarantor shall be
liable, jointly and severally, with Borrower and any other guarantor of all or
any part of the Guaranteed Indebtedness.
(b) Lender may, at its sole discretion and without impairing its rights
hereunder, (i) apply any payments on the Guaranteed Indebtedness that Lender
receives from Borrower or any other source other than Guarantor to that portion
of the Guaranteed Indebtedness, if any, not guaranteed hereunder, and (ii) apply
any proceeds it receives as a result of the foreclosure or other realization on
any collateral for the Guaranteed Indebtedness to that portion, if any, of the
Guaranteed Indebtedness not guaranteed hereunder or to any other indebtedness
secured by such collateral.
(c) Guarantor agrees that its obligations hereunder shall not be
released, diminished, impaired, reduced or affected by the existence of any
other guaranty or the payment by any other guarantor of all or any part of the
Guaranteed Indebtedness and, in the event Paragraph 2 above partially limits
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Guarantor's obligations under this Guaranty, Guarantor's obligations hereunder
shall continue until Lender has received payment in full of the Guaranteed
Indebtedness.
(d) Guarantor's obligations hereunder shall not be released, diminished,
impaired, reduced or affected by, nor shall any provision contained herein be
deemed to be a limitation upon, the amount of credit which Lender may extend to
Borrower, the number of transactions between Lender and Borrower, payments by
Borrower to Lender or Lender's allocation of payments by Borrower.
(e) Without further authorization from or notice to Guarantor, Lender may
compromise, accelerate, or otherwise alter the time or manner for the payment of
the Guaranteed Indebtedness, increase or reduce the rate of interest thereon, or
release or add any one or more guarantors or endorsers, or allow substitution of
or withdrawal of collateral or other security and release collateral and other
security or subordinate the same.
4. Representations and Warranties. Guarantor hereby represents and
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warrants the following to Lender:
(a) This Guaranty may reasonably be expected to benefit, directly or
indirectly, Guarantor, and (i) if Guarantor is a corporation, the Board of
Directors of Guarantor has determined that this Guaranty may reasonably be
expected to benefit, directly or indirectly, Guarantor, or (ii) if Guarantor is
a partnership, the requisite number of its partners have
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determined that this Guaranty may reasonably be expected to benefit, directly or
indirectly, Guarantor; and
(b) Guarantor is familiar with, and has independently reviewed the books
and records regarding, the financial condition of Borrower and is familiar with
the value of any and all collateral intended to be security for the payment of
all or any part of the Guaranteed Indebtedness; provided, however, Guarantor is
not relying on such financial condition or collateral as an inducement to enter
into this Guaranty; and
(c) Guarantor has adequate means to obtain from Borrower on a continuing
basis information concerning the financial condition of Borrower and Guarantor
is not relying on Lender to provide such information to Guarantor either now or
in the future; and
(d) Guarantor has the power and authority to execute, deliver and perform
this Guaranty and any other agreements executed by Guarantor contemporaneously
herewith, and the execution, delivery and performance of this Guaranty and any
other agreements executed by Guarantor contemporaneously herewith do not and
will not violate (i) any agreement or instrument to which Guarantor is a party,
(ii) any law, rule, regulation or order of any governmental authority to which
Guarantor is subject, or (iii) its articles or certificate of incorporation or
bylaws, if Guarantor is a corporation, or its partnership agreement, if
Guarantor is a partnership; and
(e) Neither Lender nor any other party has made any representation,
warranty or statement to Guarantor in order to induce Guarantor to execute this
Guaranty; and
(f) The financial statements and other financial information regarding
Guarantor heretofore and hereafter delivered to Lender are and shall be true and
correct in all material respects and fairly present the financial position of
Guarantor as of the dates thereof, and no material adverse change has occurred
in the financial condition of Guarantor reflected in the financial statements
and other financial information regarding Guarantor heretofore delivered to
Lender since the date of the last statement thereof; and
(g) As of the date hereof, and after giving effect to this Guaranty and
the obligations evidenced hereby, (i) Guarantor is and will be solvent, (ii) the
fair saleable value of Guarantor's assets exceeds and will continue to exceed
its liabilities (both fixed and contingent), (iii) Guarantor is and will
continue to be able to pay its debts as they mature, and (iv) if Guarantor is
not an individual, Guarantor has and will continue to have sufficient capital to
carry on its business and all businesses in which it is about to engage.
5. Covenants. Guarantor hereby covenants and agrees with Lender as
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follows:
(a) Guarantor shall not, so long as its obligations under this Guaranty
continue, transfer or pledge any material portion of its assets for less than
full and adequate consideration; and
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(b) Guarantor shall promptly furnish to Lender at any time and from time
to time such financial statements and other financial information of Guarantor
as the Lender may require, in form and substance satisfactory to Lender; and
(c) Guarantor shall comply with all terms and provisions of the Loan
Documents that apply to Guarantor; and
(d) Guarantor shall promptly inform Lender of (i) any litigation or
governmental investigation against Guarantor or affecting any security for all
or any part of the Guaranteed Indebtedness or this Guaranty which, if determined
adversely, might have a material adverse effect upon the financial condition of
Guarantor or upon such security or might cause a default under any of the Loan
Documents, (ii) any claim or controversy which might become the subject of such
litigation or governmental investigation, and (iii) any material adverse change
in the financial condition of Guarantor.
6. Consent and Waiver.
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(a) Guarantor waives (i) promptness, diligence and notice of acceptance of
this Guaranty and notice of the incurring of any obligation, indebtedness or
liability to which this Guaranty applies or may apply and waives presentment for
payment, notice of nonpayment, protest, demand, notice of protest, notice of
intent to accelerate, notice of acceleration, notice of dishonor, diligence in
enforcement and indulgences of every kind, and (ii) the taking of any other
action by Lender, including without limitation giving any notice of default or
any other notice to, or making any demand on, Borrower, any other guarantor of
all or any part of the Guaranteed Indebtedness or any other party.
(b) Guarantor waives any rights Guarantor has under, or any requirements
imposed by, Chapter 34 of the Texas Business and Commerce Code, as in effect on
the date of this Guaranty or as it may be amended from time to time.
(c) Lender may at any time, without the consent of or notice to Guarantor,
without incurring responsibility to Guarantor and without impairing, releasing,
reducing or affecting the obligations of Guarantor hereunder: (i) change the
manner, place or terms of payment of all or any part of the Guaranteed
Indebtedness, or renew, extend, modify, rearrange or alter all or any part of
the Guaranteed Indebtedness; (ii) change the interest rate accruing on any of
the Guaranteed Indebtedness (including, without limitation, any periodic change
in such interest rate that occurs because such Guaranteed Indebtedness accrues
interest at a variable rate which may fluctuate from time to time); (iii) sell,
exchange, release, surrender, subordinate, realize upon or otherwise deal with
in any manner and in any order any collateral for all or any part of the
Guaranteed Indebtedness or this Guaranty or setoff against all or any part of
the Guaranteed Indebtedness; (iv) neglect, delay, omit, fail or refuse to take
or prosecute any action for the
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collection of all or any part of the Guaranteed Indebtedness or this Guaranty or
to take or prosecute any action in connection with any of the Loan Documents;
(v) exercise or refrain from exercising any rights against Borrower or others,
or otherwise act or refrain from acting; (vi) settle or compromise all or any
part of the Guaranteed Indebtedness and subordinate the payment of all or any
part of the Guaranteed Indebtedness to the payment of any obligations,
indebtedness or liabilities which may be due or become due to Lender or others;
(vii) apply any deposit balance, fund, payment, collections through process of
law or otherwise or other collateral of Borrower to the satisfaction and
liquidation of the indebtedness or obligations of Borrower to Lender not
guaranteed under this Guaranty; and (viii) apply any sums paid to Lender by
Guarantor, Borrower or others to the Guaranteed Indebtedness in such order and
manner as Lender, in its sole discretion, may determine.
(d) Should Lender seek to enforce the obligations of Guarantor hereunder
by action in any court or otherwise, Guarantor waives any requirement,
substantive or procedural, that (i) Lender first enforce any rights or remedies
against Borrower or any other person or entity liable to Lender for all or any
part of the Guaranteed Indebtedness, including without limitation that a
judgment first be rendered against Borrower or any other person or entity, or
that Borrower or any other person or entity should be joined in such cause, or
(ii) Lender first enforce rights against any collateral which shall ever have
been given to secure all or any part of the Guaranteed Indebtedness or this
Guaranty. Such waiver shall be without prejudice to Lender's right, at its
option, to proceed against Borrower or any other person or entity, whether by
separate action or by joinder.
(e) In addition to any other waivers, agreements and covenants of
Guarantor set forth herein, Guarantor hereby further waives and releases all
claims, causes of action, defenses and offsets for any act or omission of
Lender, its directors, officers, employees, representatives or agents in
connection with Lender's administration of the Guaranteed Indebtedness, except
for Lender's willful misconduct and gross negligence.
(f) Guarantor grants to Lender a contractual security interest in, and
hereby assigns, conveys, delivers, pledges and transfers to Lender all
Guarantor's right, title and interest in and to Guarantor's accounts with Lender
(whether checking, savings or some other account), including without limitation
all accounts held jointly with someone else and all accounts Guarantor may open
in the future, excluding however all XXX and Xxxxx accounts, and all trust
accounts for which the grant of a security interest would be prohibited by law.
Guarantor authorizes Lender, to the extent permitted by applicable law, to
charge or setoff all sums owing on the Guaranteed Indebtedness against any and
all such accounts.
7. Obligations Not Impaired.
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(a) Guarantor agrees that its obligations hereunder shall not be released,
diminished, impaired, reduced or affected by the occurrence of any one or more
of the following events: (i) the death, disability or lack of corporate power
of Borrower, Guarantor (except as provided in Paragraph 10 herein) or any other
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guarantor of all or any part of the Guaranteed Indebtedness, (ii)
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any receivership, insolvency, bankruptcy or other proceedings affecting
Borrower, Guarantor or any other guarantor of all or any part of the Guaranteed
Indebtedness, or any of their respective property; (iii) the partial or total
release or discharge of Borrower or any other guarantor of all or any part of
the Guaranteed Indebtedness, or any other person or entity from the performance
of any obligation contained in any instrument or agreement evidencing, governing
or securing all or any part of the Guaranteed Indebtedness, whether occurring by
reason of law or otherwise; (iv) the taking or accepting of any collateral for
all or any part of the Guaranteed Indebtedness or this Guaranty; (v) the taking
or accepting of any other guaranty for all or any part of the Guaranteed
Indebtedness; (vi) any failure by Lender to acquire, perfect or continue any
lien or security interest on collateral securing all or any part of the
Guaranteed Indebtedness or this Guaranty; (vii) the impairment of any collateral
securing all or any part of the Guaranteed Indebtedness or this Guaranty; (viii)
any failure by Lender to sell any collateral securing all or any part of the
Guaranteed Indebtedness or this Guaranty in a commercially reasonable manner or
as otherwise required by law; (ix) any invalidity or unenforceability of or
defect or deficiency in any of the Loan Documents; or (x) any other circumstance
which might otherwise constitute a defense available to, or discharge of,
Borrower or any other guarantor of all or any part of the Guaranteed
Indebtedness.
(b) This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of all or any part of the Guaranteed
Indebtedness is rescinded or must otherwise be returned by Lender upon the
insolvency, bankruptcy or reorganization of Borrower, Guarantor, any other
guarantor of all or any part of the Guaranteed Indebtedness, or otherwise, all
as though such payment had not been made.
(c) In the event Borrower is a corporation, joint stock association or
partnership, or is hereafter incorporated, none of the following shall affect
Guarantor's liability hereunder: (i) the unenforceability of all or any part of
the Guaranteed Indebtedness against Borrower by reason of the fact that the
Guaranteed Indebtedness exceeds the amount permitted by law; (ii) the act of
creating all or any part of the Guaranteed Indebtedness is ultra xxxxx; or (iii)
the officers or partners creating all or any part of the Guaranteed Indebtedness
acted in excess of their authority. Guarantor hereby acknowledges that
withdrawal from, or termination of, any ownership interest in Borrower now or
hereafter owned or held by Guarantor shall not alter, affect or in any way limit
the obligations of Guarantor hereunder.
8. Actions Against Guarantor. In the event of a default in the payment
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or performance of all or any part of the Guaranteed Indebtedness when such
Guaranteed Indebtedness becomes due, whether by its terms, by acceleration or
otherwise, Guarantor shall, without notice or demand, promptly pay the amount
due thereon to Lender, in lawful money of the United States, at Lender's address
set forth in Subparagraph 1(a) above. One or more successive or concurrent
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actions may be brought against Guarantor, either in the same action in which
Borrower is sued or in separate actions, as often as Lender deems advisable.
The exercise by Lender of any right or remedy under this Guaranty or under any
other agreement or instrument, at law, in equity or otherwise, shall not
preclude concurrent or subsequent exercise of any other right or remedy. The
books and records of Lender shall be admissible as evidence in any action or
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proceeding involving this Guaranty and shall be prima facie evidence of the
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payments made on, and the outstanding balance of, the Guaranteed Indebtedness.
9. Payment by Guarantor. Whenever Guarantor pays any sum which is or may
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become due under this Guaranty, written notice must be delivered to Lender
contemporaneously with such payment. Such notice shall be effective for
purposes of this paragraph when contemporaneously with such payment Lender
receives such notice either by: (a) personal delivery to the address and
designated department of Lender identified in Subparagraph 1(a) above, or (b)
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United States mail, certified or registered, return receipt requested, postage
prepaid, addressed to Lender at the address shown in Subparagraph 1(a) above.
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In the absence of such notice to Lender by Guarantor in compliance with the
provisions hereof, any sum received by Lender on account of the Guaranteed
Indebtedness shall be conclusively deemed paid by Borrower.
10. Death of Guarantor. In the event of the death of Guarantor, the
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obligations of the deceased Guarantor under this Guaranty shall continue as an
obligation against his estate as to (a) all of the Guaranteed Indebtedness that
is outstanding on the date of Guarantor's death, and any renewals or extensions
thereof, and (b) all loans, advances and other extensions of credit made to or
for the account of Borrower on or after the date of Guarantor's death pursuant
to an obligation of Lender under a commitment or agreement described in
Subparagraph 1(d) above and made to or with Borrower prior to the date of
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Guarantor's death. The terms and conditions of this Guaranty, including without
limitation the consents and waivers set forth in Paragraph 6 hereof, shall
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remain in effect with respect to the Guaranteed Indebtedness described in the
preceding sentence in the same manner as if Guarantor had not died.
11. Notice of Sale. In the event that Guarantor is entitled to receive
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any notice under the Uniform Commercial Code, as it exists in the state
governing any such notice, of the sale or other disposition of any collateral
securing all or any part of the Guaranteed Indebtedness or this Guaranty,
reasonable notice shall be deemed given when such notice is deposited in the
United States mail, postage prepaid, at the address for Guarantor set forth in
Subparagraph 1(c) above, ten (10) days prior to the date any public sale, or
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after which any private sale, of any such collateral is to be held; provided,
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however, that notice given in any other reasonable manner or at any other
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reasonable time shall be sufficient.
12. Waiver by Lender. No delay on the part of Lender in exercising any
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right hereunder or failure to exercise the same shall operate as a waiver of
such right. In no event shall any waiver of the provisions of this Guaranty be
effective unless the same be in writing and signed by an officer of Lender, and
then only in the specific instance and for the purpose given.
13. Successors and Assigns. This Guaranty is for the benefit of Lender,
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its successors and assigns. This Guaranty is binding upon Guarantor and
Guarantor's heirs, executors, administrators, personal representatives and
successors, including without limitation any person or entity obligated by
operation of law upon the reorganization, merger, consolidation or other change
in the organizational structure of Guarantor.
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14. Costs and Expenses. Guarantor shall pay on demand by Lender all costs
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and expenses, including without limitation all reasonable attorneys' fees,
incurred by Lender in connection with the preparation, administration,
enforcement and/or collection of this Guaranty. This covenant shall survive the
payment of the Guaranteed Indebtedness.
15. Severability. If any provision of this Guaranty is held by a court of
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competent jurisdiction to be illegal, invalid or unenforceable under present or
future laws, such provision shall be fully severable, shall not impair or
invalidate the remainder of this Guaranty and the effect thereof shall be
confined to the provision held to be illegal, invalid or unenforceable.
16. No Obligation. Nothing contained herein shall be construed as an
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obligation on the part of Lender to extend or continue to extend credit to
Borrower.
17. Amendment. No modification or amendment of any provision of this
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Guaranty, nor consent to any departure by Guarantor therefrom, shall be
effective unless the same shall be in writing and signed by an officer of
Lender, and then shall be effective only in the specific instance and for the
purpose for which given.
18. Cumulative Rights. All rights and remedies of Lender hereunder are
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cumulative of each other and of every other right or remedy which Lender may
otherwise have at law or in equity or under any instrument or agreement, and the
exercise of one or more of such rights or remedies shall not prejudice or impair
the concurrent or subsequent exercise of any other rights or remedies.
19. Governing Law, Venue. This Guaranty is intended to be performed in the
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State of Texas. Except to the extent that the laws of the United States may
apply to the terms hereof, the substantive laws of the State of Texas shall
govern the validity, construction, enforcement and interpretation of this
Guaranty. In the event of a dispute involving this Guaranty or any other
instruments executed in connection herewith, the undersigned irrevocably agrees
that venue for such dispute shall lie in any court of competent jurisdiction in
Bexar County, Texas.
20. Compliance with Applicable Usury Laws. Notwithstanding any other
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provision of this Guaranty or of any instrument or agreement evidencing,
governing or securing all or any part of the Guaranteed Indebtedness, Guarantor
and Lender by its acceptance hereof agree that Guarantor shall never be required
or obligated to pay interest in excess of the maximum non-usurious interest rate
as may be authorized by applicable law for the written contracts which
constitute the Guaranteed Indebtedness. It is the intention of Guarantor and
Lender to conform strictly to the applicable laws which limit interest rates,
and any of the aforesaid contracts for interest, if and to the extent payable by
Guarantor, shall be held to be subject to reduction to the maximum non-usurious
interest rate allowed under said law.
21. Gender. Within this Guaranty, words of any gender shall be held and
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construed to include the other gender.
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22. Captions. The headings in this Guaranty are for convenience only and
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shall not define or limit the provisions hereof.
EXECUTED as of the date first above written.
GUARANTOR:
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BERKSHIRE WIRELESS, INC.,
a Massachusetts corporation
By:
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Xxxxxxx X. Xxxxx, President
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