Exhibit 10.27
GUARANTY
FOR VALUE RECEIVED and in consideration of any loan or other financial
accommodation heretofore or hereafter at any time made or granted to CTI
Industries Corporation, a Delaware corporation (hereinafter called the
"Borrower") by First American Bank, an Illinois banking corporation (hereinafter
called the "Bank"), the undersigned hereby unconditionally guarantee(s) the full
and prompt payment when due, whether by acceleration or otherwise, and at all
times thereafter, of all obligations of the Borrower to the Bank, howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, or now or hereafter existing, or due or to become due (all such
obligations being hereinafter collectively called the "Obligations"), and the
undersigned further agree(s) to pay all expenses (including attorneys' fees and
legal expenses) paid or incurred by the Bank in endeavoring to collect the
Obligations, or any part thereof, and in enforcing this Guaranty.
1. Each of the undersigned agrees that, in the event of the death,
incompetency, dissolution or insolvency of the Borrower or such undersigned, or
the inability of the Borrower or such undersigned to pay debts as they mature,
or an assignment by the Borrower or such undersigned for the benefit of
creditors, or the institution of any proceeding against the Borrower or such
undersigned alleging that the Borrower or such undersigned is insolvent or
unable to pay debts as they mature (and such proceeding is not dismissed or
withdrawn within 90 days after the filing thereof), and if such event shall
occur at a time when any of the Obligations may not then be due and payable,
such undersigned will pay to the Bank forthwith the full amount that would be
payable hereunder by such undersigned if all Obligations were then due and
payable.
2. This Guaranty shall in all respects be a continuing, absolute and
unconditional guaranty, and shall remain in full force and effect
(notwithstanding, without limitation, the death, incompetency or dissolution of
any of the undersigned or that at any time or from time to time all Obligations
may have been paid in full).
3. The undersigned further agree(s) that, if at any time all or any
part of any payment theretofore applied by the Bank to any of the Obligations is
or must be rescinded or returned by the Bank for any reason whatsoever
(including, without limitation, the insolvency, bankruptcy or reorganization of
the Borrower), such Obligations shall, for the purposes of this Guaranty, to the
extent that such payment is or must be rescinded or returned be deemed to have
continued in existence, notwithstanding such application by the Bank, and this
Guaranty shall continue to be effective or be reinstated, as the case may be, as
to such Obligations, all as though such application by the Bank had not been
made. The undersigned shall indemnify and defend the Bank and hold the Bank
harmless from and against any and all loss, damage, cost, or expense, (including
reasonable attorney's fees) arising out of any claim for rescission or return of
all or any part of any payment theretofore applied by the Bank to any of the
Obligations.
4. The Bank may, from time to time, at its sole discretion and without
notice to the undersigned (or any of them), take any or all of the following
actions: (a) retain or obtain a security interest in any property to secure any
of the Obligations or any obligation hereunder, (b) retain or obtain the primary
or secondary obligation of any obligor or obligors, in addition to the
undersigned, with respect to any of the Obligations, (c) extend or renew for one
or more periods (whether or not longer than the original period), alter or
exchange any of the Obligations, or release or compromise any obligation of any
of the undersigned hereunder or any obligation of any nature of any other
obligor with respect to any of the Obligations, (d) release its security
interest in, or surrender, release, or permit any substitution or exchange for,
all or any part of any property securing any of the Obligations or any
obligation hereunder, or extend or renew for one or more periods (whether or not
longer than the original period) or release, compromise, alter or exchange any
obligations of any nature of any obligor with respect to any such property, and
(e) resort to the undersigned (or any of them) for payment of any of the
Obligations, whether or not the Bank shall have resorted to any property
securing any of the Obligations or any obligation hereunder or shall have
proceeded against any other of the undersigned or any other obligor primarily or
secondarily obligated with respect to any of the Obligations.
5. Any amounts received by the Bank from whatsoever source on account
of the Obligations may be applied by it toward the payment of such of the
Obligations, and in such order of application, as the Bank may from time to time
elect. Notwithstanding any payments made by or for the account of the
undersigned pursuant to this Guaranty, the undersigned shall not be subrogated
to any rights of the Bank. The undersigned hereby waive all rights of
subrogation, indemnity, contribution, exoneration, reimbursement or other claim
which the undersigned now or may hereafter have or claim against the Borrower or
any other person liable in any way with respect to the Obligations.
6. The undersigned hereby expressly waive(s): (a) notice of the
acceptance by the Bank of this Guaranty, (b) notice of the existence or creation
or non-payment of all or any of the Obligations, (c) presentment, demand, notice
of dishonor, protest, and all other notices whatsoever, and (d) all diligence in
collection or protection of or realization upon the Obligations or any thereof,
any obligation hereunder, or any security for or guaranty of any of the
foregoing.
7. The Bank may, from time to time, without notice to the undersigned
(or any of them), assign or transfer any or all of the Obligations or any
interest therein; and, notwithstanding any such assignment or transfer or any
subsequent assignment or transfer thereof, such Obligations shall be and remain
Obligations for the purposes of this Guaranty, and each and every immediate and
successive assignee or transferee of any of the Obligations or of any interest
therein shall, to the extent of the interest of such assignee or transferee in
the Obligations, be entitled to the benefits of this Guaranty to the same extent
as if such assignee or transferee were the Bank; provided, however, that, unless
the Bank shall otherwise consent in writing, the Bank shall have an unimpaired
right, prior and superior to that of any such assignee or transferee, to enforce
this Guaranty, for the benefit of the Bank, as to those of the Obligations which
the Bank has not assigned or transferred.
8. No delay on the part of the Bank in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
the Bank of any right or remedy shall preclude other or further exercise thereof
or the exercise of any other right or remedy; nor shall any modification or
waiver of any of the provisions of this Guaranty be binding upon the Bank except
as expressly set forth in a writing duly signed and delivered on behalf of the
Bank. No action of the Bank permitted hereunder shall in any way affect or
impair the rights of the Bank and the obligation of the undersigned under this
Guaranty. For the purposes of this Guaranty, the Obligations shall include all
obligations of the Borrower to the Bank, notwithstanding any right or power of
the Borrower or anyone else to assert any claim or defense as to the invalidity
or unenforceability of any such obligation, and no such claim or defense shall
affect or impair the obligations of the undersigned hereunder.
9. This Guaranty shall be binding upon the undersigned, and upon the
heirs, legal representatives, successors and assigns of the undersigned; and to
the extent that the Borrower or any of the undersigned is either a partnership
or a corporation, all references herein to the Borrower and to the undersigned,
respectively, shall be deemed to include any successor or successors, whether
immediate or remote, to such partnership or corporation. If more than one party
shall execute this Guaranty, the term "undersigned" as used herein shall mean
all parties executing this Guaranty and each of them, and all such parties shall
be jointly and severally obligated hereunder. This Guaranty shall inure to the
benefit of the Bank and its successors and assigns, and all references herein to
the Bank shall be deemed to include its successors and assigns.
10. This Guaranty has been delivered in the State of Illinois and shall
be construed in accordance with and governed by the laws of the State of
Illinois. Wherever possible each provision of this Guaranty shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Guaranty shall be prohibited by or invalid under such law,
such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Guaranty.
11. To secure all obligations of each of the undersigned hereunder, the
Bank shall have a lien upon and security interest in (and may, without demand or
notice of any kind, at any time and from time to time when any amount shall be
due and payable by such undersigned hereunder, appropriate and apply toward the
payment of such amount, in such order of application as the Bank may elect) any
and all balances, credits, deposits, accounts, or monies of or in the name of
such undersigned now or hereafter with the Bank and any and all property of any
kind or description of or in the name of such undersigned now or hereafter, for
any reason or purpose whatsoever, in the possession or control of, or in transit
to, the Bank or any agent or bailee for the Bank.
12. During such period that the Borrower's ratio of total debt to
tangible net worth is less that 3 to 1, in accordance with Section 5.11 of the
Amended and Restated Loan and Security Agreement dated May 1, 1998, the right of
recovery against the undersigned under this Guaranty is limited to the amount of
One Million and No/100 Dollars ($1,000,000.00), plus interest on such amount and
all expenses of collecting and enforcing the Obligations and this Guaranty. The
creation or existence from time to time of Obligations in excess of the amount
to which the right of recovery under this Guaranty is limited is hereby
authorized, without notice to the undersigned (or any of them), and shall in no
way affect or impair the rights of the Bank and the obligations of the
undersigned under this Guaranty.
Signed and delivered September 1, 1998.
______________________________
Xxxxxxx X. Xxxxxxx
GUARANTY
FOR VALUE RECEIVED and in consideration of any loan or other financial
accommodation heretofore or hereafter at any time made or granted to CTI
Industries Corporation, a Delaware corporation (hereinafter called the
"Borrower") by First American Bank, an Illinois banking corporation (hereinafter
called the "Bank"), the undersigned hereby unconditionally guarantee(s) the full
and prompt payment when due, whether by acceleration or otherwise, and at all
times thereafter, of all obligations of the Borrower to the Bank, howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, or now or hereafter existing, or due or to become due (all such
obligations being hereinafter collectively called the "Obligations"), and the
undersigned further agree(s) to pay all expenses (including attorneys' fees and
legal expenses) paid or incurred by the Bank in endeavoring to collect the
Obligations, or any part thereof, and in enforcing this Guaranty.
1. Each of the undersigned agrees that, in the event of the death,
incompetency, dissolution or insolvency of the Borrower or such undersigned, or
the inability of the Borrower or such undersigned to pay debts as they mature,
or an assignment by the Borrower or such undersigned for the benefit of
creditors, or the institution of any proceeding against the Borrower or such
undersigned alleging that the Borrower or such undersigned is insolvent or
unable to pay debts as they mature (and such proceeding is not dismissed or
withdrawn within 90 days after the filing thereof), and if such event shall
occur at a time when any of the Obligations may not then be due and payable,
such undersigned will pay to the Bank forthwith the full amount that would be
payable hereunder by such undersigned if all Obligations were then due and
payable.
2. This Guaranty shall in all respects be a continuing, absolute and
unconditional guaranty, and shall remain in full force and effect
(notwithstanding, without limitation, the death, incompetency or dissolution of
any of the undersigned or that at any time or from time to time all Obligations
may have been paid in full).
3. The undersigned further agree(s) that, if at any time all or any
part of any payment theretofore applied by the Bank to any of the Obligations is
or must be rescinded or returned by the Bank for any reason whatsoever
(including, without limitation, the insolvency, bankruptcy or reorganization of
the Borrower), such Obligations shall, for the purposes of this Guaranty, to the
extent that such payment is or must be rescinded or returned be deemed to have
continued in existence, notwithstanding such application by the Bank, and this
Guaranty shall continue to be effective or be reinstated, as the case may be, as
to such Obligations, all as though such application by the Bank had not been
made. The undersigned shall indemnify and defend the Bank and hold the Bank
harmless from and against any and all loss, damage, cost, or expense, (including
reasonable attorney's fees) arising out of any claim for rescission or return of
all or any part of any payment theretofore applied by the Bank to any of the
Obligations.
4. The Bank may, from time to time, at its sole discretion and without
notice to the undersigned (or any of them), take any or all of the following
actions: (a) retain or obtain a security interest in any property to secure any
of the Obligations or any obligation hereunder, (b) retain or obtain the primary
or secondary obligation of any obligor or obligors, in addition to the
undersigned, with respect to any of the Obligations, (c) extend or renew for one
or more periods (whether or not longer than the original period), alter or
exchange any of the Obligations, or release or compromise any obligation of any
of the undersigned hereunder or any obligation of any nature of any other
obligor with respect to any of the Obligations, (d) release its security
interest in, or surrender, release, or permit any substitution or exchange for,
all or any part of any property securing any of the Obligations or any
obligation hereunder, or extend or renew for one or more periods (whether or not
longer than the original period) or release, compromise, alter or exchange any
obligations of any nature of any obligor with respect to any such property, and
(e) resort to the undersigned (or any of them) for payment of any of the
Obligations, whether or not the Bank shall have resorted to any property
securing any of the Obligations or any obligation hereunder or shall have
proceeded against any other of the undersigned or any other obligor primarily or
secondarily obligated with respect to any of the Obligations.
5. Any amounts received by the Bank from whatsoever source on account
of the Obligations may be applied by it toward the payment of such of the
Obligations, and in such order of application, as the Bank may from time to time
elect. Notwithstanding any payments made by or for the account of the
undersigned pursuant to this Guaranty, the undersigned shall not be subrogated
to any rights of the Bank. The undersigned hereby waive all rights of
subrogation, indemnity, contribution, exoneration, reimbursement or other claim
which the undersigned now or may hereafter have or claim against the Borrower or
any other person liable in any way with respect to the Obligations.
6. The undersigned hereby expressly waive(s): (a) notice of the
acceptance by the Bank of this Guaranty, (b) notice of the existence or creation
or non-payment of all or any of the Obligations, (c) presentment, demand, notice
of dishonor, protest, and all other notices whatsoever, and (d) all diligence in
collection or protection of or realization upon the Obligations or any thereof,
any obligation hereunder, or any security for or guaranty of any of the
foregoing.
7. The Bank may, from time to time, without notice to the undersigned
(or any of them), assign or transfer any or all of the Obligations or any
interest therein; and, notwithstanding any such assignment or transfer or any
subsequent assignment or transfer thereof, such Obligations shall be and remain
Obligations for the purposes of this Guaranty, and each and every immediate and
successive assignee or transferee of any of the Obligations or of any interest
therein shall, to the extent of the interest of such assignee or transferee in
the Obligations, be entitled to the benefits of this Guaranty to the same extent
as if such assignee or transferee were the Bank; provided, however, that, unless
the Bank shall otherwise consent in writing, the Bank shall have an unimpaired
right, prior and superior to that of any such assignee or transferee, to enforce
this Guaranty, for the benefit of the Bank, as to those of the Obligations which
the Bank has not assigned or transferred.
8. No delay on the part of the Bank in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
the Bank of any right or remedy shall preclude other or further exercise thereof
or the exercise of any other right or remedy; nor shall any modification or
waiver of any of the provisions of this Guaranty be binding upon the Bank except
as expressly set forth in a writing duly signed and delivered on behalf of the
Bank. No action of the Bank permitted hereunder shall in any way affect or
impair the rights of the Bank and the obligation of the undersigned under this
Guaranty. For the purposes of this Guaranty, the Obligations shall include all
obligations of the Borrower to the Bank, notwithstanding any right or power of
the Borrower or anyone else to assert any claim or defense as to the invalidity
or unenforceability of any such obligation, and no such claim or defense shall
affect or impair the obligations of the undersigned hereunder.
9. This Guaranty shall be binding upon the undersigned, and upon the
heirs, legal representatives, successors and assigns of the undersigned; and to
the extent that the Borrower or any of the undersigned is either a partnership
or a corporation, all references herein to the Borrower and to the undersigned,
respectively, shall be deemed to include any successor or successors, whether
immediate or remote, to such partnership or corporation. If more than one party
shall execute this Guaranty, the term "undersigned" as used herein shall mean
all parties executing this Guaranty and each of them, and all such parties shall
be jointly and severally obligated hereunder. This Guaranty shall inure to the
benefit of the Bank and its successors and assigns, and all references herein to
the Bank shall be deemed to include its successors and assigns.
10. This Guaranty has been delivered in the State of Illinois and shall
be construed in accordance with and governed by the laws of the State of
Illinois. Wherever possible each provision of this Guaranty shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Guaranty shall be prohibited by or invalid under such law,
such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Guaranty.
11. To secure all obligations of each of the undersigned hereunder, the
Bank shall have a lien upon and security interest in (and may, without demand or
notice of any kind, at any time and from time to time when any amount shall be
due and payable by such undersigned hereunder, appropriate and apply toward the
payment of such amount, in such order of application as the Bank may elect) any
and all balances, credits, deposits, accounts, or monies of or in the name of
such undersigned now or hereafter with the Bank and any and all property of any
kind or description of or in the name of such undersigned now or hereafter, for
any reason or purpose whatsoever, in the possession or control of, or in transit
to, the Bank or any agent or bailee for the Bank.
12. During such period that the Borrower's ratio of total debt to
tangible net worth is less that 3 to 1, in accordance with Section 5.11 of the
Amended and Restated Loan and Security Agreement dated May 1, 1998, the right of
recovery against the undersigned under this Guaranty is limited to the amount of
One Million and No/100 Dollars ($1,000,000.00), plus interest on such amount and
all expenses of collecting and enforcing the Obligations and this Guaranty. The
creation or existence from time to time of Obligations in excess of the amount
to which the right of recovery under this Guaranty is limited is hereby
authorized, without notice to the undersigned (or any of them), and shall in no
way affect or impair the rights of the Bank and the obligations of the
undersigned under this Guaranty.
Signed and delivered September 1, 1998.
_____________________________
Xxxx X. Xxxxxx
GUARANTY
FOR VALUE RECEIVED and in consideration of any loan or other financial
accommodation heretofore or hereafter at any time made or granted to CTI
Industries Corporation, a Delaware corporation (hereinafter called the
"Borrower") by First American Bank, an Illinois banking corporation (hereinafter
called the "Bank"), the undersigned hereby unconditionally guarantee(s) the full
and prompt payment when due, whether by acceleration or otherwise, and at all
times thereafter, of all obligations of the Borrower to the Bank, howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, or now or hereafter existing, or due or to become due (all such
obligations being hereinafter collectively called the "Obligations"), and the
undersigned further agree(s) to pay all expenses (including attorneys' fees and
legal expenses) paid or incurred by the Bank in endeavoring to collect the
Obligations, or any part thereof, and in enforcing this Guaranty.
1. Each of the undersigned agrees that, in the event of the death,
incompetency, dissolution or insolvency of the Borrower or such undersigned, or
the inability of the Borrower or such undersigned to pay debts as they mature,
or an assignment by the Borrower or such undersigned for the benefit of
creditors, or the institution of any proceeding against the Borrower or such
undersigned alleging that the Borrower or such undersigned is insolvent or
unable to pay debts as they mature (and such proceeding is not dismissed or
withdrawn within 90 days after the filing thereof), and if such event shall
occur at a time when any of the Obligations may not then be due and payable,
such undersigned will pay to the Bank forthwith the full amount that would be
payable hereunder by such undersigned if all Obligations were then due and
payable.
2. This Guaranty shall in all respects be a continuing, absolute and
unconditional guaranty, and shall remain in full force and effect
(notwithstanding, without limitation, the death, incompetency or dissolution of
any of the undersigned or that at any time or from time to time all Obligations
may have been paid in full).
3. The undersigned further agree(s) that, if at any time all or any
part of any payment theretofore applied by the Bank to any of the Obligations is
or must be rescinded or returned by the Bank for any reason whatsoever
(including, without limitation, the insolvency, bankruptcy or reorganization of
the Borrower), such Obligations shall, for the purposes of this Guaranty, to the
extent that such payment is or must be rescinded or returned be deemed to have
continued in existence, notwithstanding such application by the Bank, and this
Guaranty shall continue to be effective or be reinstated, as the case may be, as
to such Obligations, all as though such application by the Bank had not been
made. The undersigned shall indemnify and defend the Bank and hold the Bank
harmless from and against any and all loss, damage, cost, or expense, (including
reasonable attorney's fees) arising out of any claim for rescission or return of
all or any part of any payment theretofore applied by the Bank to any of the
Obligations.
4. The Bank may, from time to time, at its sole discretion and without
notice to the undersigned (or any of them), take any or all of the following
actions: (a) retain or obtain a security interest in any property to secure any
of the Obligations or any obligation hereunder, (b) retain or obtain the primary
or secondary obligation of any obligor or obligors, in addition to the
undersigned, with respect to any of the Obligations, (c) extend or renew for one
or more periods (whether or not longer than the original period), alter or
exchange any of the Obligations, or release or compromise any obligation of any
of the undersigned hereunder or any obligation of any nature of any other
obligor with respect to any of the Obligations, (d) release its security
interest in, or surrender, release, or permit any substitution or exchange for,
all or any part of any property securing any of the Obligations or any
obligation hereunder, or extend or renew for one or more periods (whether or not
longer than the original period) or release, compromise, alter or exchange any
obligations of any nature of any obligor with respect to any such property, and
(e) resort to the undersigned (or any of them) for payment of any of the
Obligations, whether or not the Bank shall have resorted to any property
securing any of the Obligations or any obligation hereunder or shall have
proceeded against any other of the undersigned or any other obligor primarily or
secondarily obligated with respect to any of the Obligations.
5. Any amounts received by the Bank from whatsoever source on account
of the Obligations may be applied by it toward the payment of such of the
Obligations, and in such order of application, as the Bank may from time to time
elect. Notwithstanding any payments made by or for the account of the
undersigned pursuant to this Guaranty, the undersigned shall not be subrogated
to any rights of the Bank. The undersigned hereby waive all rights of
subrogation, indemnity, contribution, exoneration, reimbursement or other claim
which the undersigned now or may hereafter have or claim against the Borrower or
any other person liable in any way with respect to the Obligations.
6. The undersigned hereby expressly waive(s): (a) notice of the
acceptance by the Bank of this Guaranty, (b) notice of the existence or creation
or non-payment of all or any of the Obligations, (c) presentment, demand, notice
of dishonor, protest, and all other notices whatsoever, and (d) all diligence in
collection or protection of or realization upon the Obligations or any thereof,
any obligation hereunder, or any security for or guaranty of any of the
foregoing.
7. The Bank may, from time to time, without notice to the undersigned
(or any of them), assign or transfer any or all of the Obligations or any
interest therein; and, notwithstanding any such assignment or transfer or any
subsequent assignment or transfer thereof, such Obligations shall be and remain
Obligations for the purposes of this Guaranty, and each and every immediate and
successive assignee or transferee of any of the Obligations or of any interest
therein shall, to the extent of the interest of such assignee or transferee in
the Obligations, be entitled to the benefits of this Guaranty to the same extent
as if such assignee or transferee were the Bank; provided, however, that, unless
the Bank shall otherwise consent in writing, the Bank shall have an unimpaired
right, prior and superior to that of any such assignee or transferee, to enforce
this Guaranty, for the benefit of the Bank, as to those of the Obligations which
the Bank has not assigned or transferred.
8. No delay on the part of the Bank in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
the Bank of any right or remedy shall preclude other or further exercise thereof
or the exercise of any other right or remedy; nor shall any modification or
waiver of any of the provisions of this Guaranty be binding upon the Bank except
as expressly set forth in a writing duly signed and delivered on behalf of the
Bank. No action of the Bank permitted hereunder shall in any way affect or
impair the rights of the Bank and the obligation of the undersigned under this
Guaranty. For the purposes of this Guaranty, the Obligations shall include all
obligations of the Borrower to the Bank, notwithstanding any right or power of
the Borrower or anyone else to assert any claim or defense as to the invalidity
or unenforceability of any such obligation, and no such claim or defense shall
affect or impair the obligations of the undersigned hereunder.
9. This Guaranty shall be binding upon the undersigned, and upon the
heirs, legal representatives, successors and assigns of the undersigned; and to
the extent that the Borrower or any of the undersigned is either a partnership
or a corporation, all references herein to the Borrower and to the undersigned,
respectively, shall be deemed to include any successor or successors, whether
immediate or remote, to such partnership or corporation. If more than one party
shall execute this Guaranty, the term "undersigned" as used herein shall mean
all parties executing this Guaranty and each of them, and all such parties shall
be jointly and severally obligated hereunder. This Guaranty shall inure to the
benefit of the Bank and its successors and assigns, and all references herein to
the Bank shall be deemed to include its successors and assigns.
10. This Guaranty has been delivered in the State of Illinois and shall
be construed in accordance with and governed by the laws of the State of
Illinois. Wherever possible each provision of this Guaranty shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Guaranty shall be prohibited by or invalid under such law,
such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Guaranty.
11. To secure all obligations of each of the undersigned hereunder, the
Bank shall have a lien upon and security interest in (and may, without demand or
notice of any kind, at any time and from time to time when any amount shall be
due and payable by such undersigned hereunder, appropriate and apply toward the
payment of such amount, in such order of application as the Bank may elect) any
and all balances, credits, deposits, accounts, or monies of or in the name of
such undersigned now or hereafter with the Bank and any and all property of any
kind or description of or in the name of such undersigned now or hereafter, for
any reason or purpose whatsoever, in the possession or control of, or in transit
to, the Bank or any agent or bailee for the Bank.
12. During such period that the Borrower's ratio of total debt to
tangible net worth is less that 3 to 1, in accordance with Section 5.11 of the
Amended and Restated Loan and Security Agreement dated May 1, 1998, the right of
recovery against the undersigned under this Guaranty is limited to the amount of
One Million and No/100 Dollars ($1,000,000.00), plus interest on such amount and
all expenses of collecting and enforcing the Obligations and this Guaranty. The
creation or existence from time to time of Obligations in excess of the amount
to which the right of recovery under this Guaranty is limited is hereby
authorized, without notice to the undersigned (or any of them), and shall in no
way affect or impair the rights of the Bank and the obligations of the
undersigned under this Guaranty.
Signed and delivered September 1, 1998.
_________________________
Xxxxxx X. Xxxxxx
