Exhibit 10.3
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GUARANTY
Guaranty Agreement made as of the 2nd day of November,
1998, by TOUCHSTONE APPLIED SCIENCE ASSOCIATES, INC., a Delaware
corporation with a principal place of business at 0 Xxxxxxxxxxxx
Xxxxxxx, Xxxxxxxx, Xxx Xxxx 00000 (the "Guarantor"), in favor of
XXXXXXX XXXXX SCHOOL, INC., with an address at 000 Xxx Xxxxxx
Xxxx, Xxxxxx, Xxx Xxxx 00000 (the "Seller").
W I T N E S S E T H:
WHEREAS, the Seller is a party to an Asset Purchase
Agreement dated as of November 2, 1998, relating to the sale of
substantially all of the assets of Seller to MESI ACQUISITION
CORP. ("Purchaser") (the "Asset Purchase Agreement"); and
WHEREAS, it is a condition to the Asset Purchase
Agreement that Guarantor shall have executed and delivered to
Seller this Guaranty Agreement.
NOW, THEREFORE, in consideration of the premises and
the agreements herein and in order to induce Seller to execute
the Asset Purchase Agreement, Guarantor, hereby agrees with
Seller as follows:
Section 1. Incorporation of Agreements and
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Definitions. The premises set forth above are incorporated into
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this Guaranty Agreement by this reference thereto and are made a
part hereof. All terms used in this Guaranty Agreement not
otherwise defined herein are used as defined in the Asset
Purchase Agreement.
Section 2. Guaranty. Guarantor, hereby
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irrevocably, absolutely and unconditionally, guarantees the due
and punctual payment of all liabilities and obligations owing to
Seller from the Purchaser, pursuant to the Asset Purchase
Agreement and any document executed in connection therewith and
herewith (collectively, the "Other Documents"), (all such
obligations being hereinafter referred to as the "Secured
Obligations").
Section 3. Guarantor's Obligations Unconditional;
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Subordination. The liability of the Guarantor hereunder shall be
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absolute and unconditional. This Agreement is a continuing
guaranty and shall remain in full force and effect until the
satisfaction in full of the Secured Obligations and the payment
of the other expenses to be paid by Guarantor pursuant hereto;
and shall continue to be effective or shall be reinstated, as the
case may be, if at any time any payment of any of the Secured
Obligations is rescinded or must otherwise be returned by Seller
upon the insolvency, bankruptcy or reorganization of the
Purchaser or otherwise, all as though such payments have not been
made.
Section 4. Waivers. Except as specifically
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required by this Agreement, Guarantor hereby waives notice of
acceptance, presentment and demand for payment and any
requirement that Seller exhaust any right to take any action
against the Purchaser any other person including any other
guarantor.
Section 5. Representations and Warranties.
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Guarantor hereby represents and warrants as follows:
(a) Guarantor is a corporation duly
organized and existing and in good standing under the laws of the
State of Delaware and is duly qualified to transact business in
the State of New York. Guarantor has full power and authority to
carry out and perform undertakings and obligations as provided
herein. The execution and delivery by Guarantor of this Guaranty
and the consummation of the transactions contemplated in this
Guaranty have been duly authorized by all proper or requisite
corporate proceedings and will not conflict with or breach any
provision of any agreement to which Guarantor is a party or by
which it may be bound, the Articles of Incorporation or By-Laws
of Guarantor.
(b) The execution, delivery and performance
by Guarantor of this Guaranty Agreement do not and will not
contravene any contractual restriction or, any law binding on or
effecting Guarantor or any of its properties.
(c) No consent or approval is required for
the due execution, delivery and
performance by Guarantor of this Guaranty Agreement.
(d) This Guaranty Agreement is a legal,
valid and binding obligation of Guarantor, enforceable against
Guarantor in accordance with its terms, except as may be limited
by (i) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect affecting the
enforcement of creditor's rights generally and (ii) general
principals of equity (regardless of whether considered in a
proceeding in equity or in law).
(e) There is no action, suit or proceeding
pending, or to the best of Guarantor's knowledge, threatened
against or otherwise affecting Guarantor or any guarantor before
any court or any government body or any arbitrator which may
materially adversely affect Guarantor's or any guarantor's
ability to perform its obligations hereunder.
(f) All representations and warranties
herein shall survive the execution and
delivery by Guarantor of this Guaranty Agreement and any Other
Documents in connection with the Asset Purchase Agreement to
which it is a party and the closing of the transaction described
herein or therein or related thereto until all Secured
Obligations are paid in full.
Section 6. Covenants. So long as any of the
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Secured Obligations shall remain outstanding, Guarantor agrees to
promptly to pay and perform all of Guarantor's obligations
hereunder.
Section 7. Expenses. Guarantor will pay to Seller
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the amount of any and all reasonable costs and expenses,
including the reasonable fees and disbursements of his counsel,
which Seller incurs in connection with the enforcement of this
Guaranty Agreement.
Section 8. Modifications, Waivers, Extensions and
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Releases. No modification or amendment of or waiver with respect
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to any provision of this Guaranty Agreement, shall in any event
be effective unless it shall be in writing and signed by the
parties hereto.
Section 9. Entire Agreement. This Guaranty
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Agreement and documents executed in connection therewith
(together with the Asset Purchase Agreement and each of the Other
Documents) contains the entire agreement and understanding
between the Purchaser, Seller and Guarantor and supersedes all
prior agreements and understanding related to the subject matter
hereof.
Section 10. Remedies Cumulative. Each and every
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right granted to Seller or allowed by law or equity, shall be
cumulative and may be exercised from time to time. No failure on
part of Seller to exercise any right shall operate as a waiver
thereof.
Section 11. Severability. Any provision of this
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Agreement that is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the
remaining provisions hereof.
Section 12. Notices. All notices and other
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communications shall be in writing, sent by facsimile or
certified mail, return receipt requested, postage prepaid,
addressed as follows (or to such other address as the recipient
shall have previously notified the sender of in writing):
If to Guarantor: Touchstone Applied Science Associates, Inc.
0 Xxxxxxxxxxxx Xxxxxxx
Xxxxxxxx, XX 00000
Att: Xx. Xxxxxx X. Xxxxx
Fax: (000) 000-0000
with a copy to: Rider, Weiner, Xxxxxxx & Calhelha, P.C.
000 Xxxxxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Att: Xxxxxxx Crush, Esq.
Fax: (000) 000-0000
If to Seller: Xxxxxxx Xxxxx School, Inc.
000 Xxx Xxxxxx Xxxx
Xxxxxx, Xxx Xxxx 00000
Att: Faith A. Takes
Fax: (000) 000-0000
with a copy to: Crane, Xxxxxx & Parente
00 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Att: Xxxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
Any notice or communication hereunder shall be deemed to have
been given 3 business days after the day on which it is deposited
in the United States mails, or if sent by facsimile when sent
with evidence of successful transmission.
Section 13. Governing Law. This Agreement shall be
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governed by and construed in accordance with the laws of the
State of New York as applicable to contracts entered into and to
be performed wholly within the State. Any action arising out of
or related to this Agreement shall be brought in the state or
federal courts located in Albany County, New York and the parties
hereby submit to the exclusive jurisdiction of and to the laying
of venue in such courts.
Section 14. Consent to Jurisdiction. Guarantor
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irrevocably accepts the jurisdiction of the federal or state
courts of competent jurisdiction located in the County of Albany
and any related appellate court.
Section 15. Waiver of Jury Trial. EXCEPT AS PROHIBITED
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BY STATUTE, GUARANTOR SHALL AND DOES HEREBY IRREVOCABLY WAIVE
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT
BY SELLER AGAINST ANY GUARANTOR ON ANY MATTER WHATSOEVER ARISING
OUT OF OR IN ANY WAY CONNECTED WITH THIS GUARANTY AGREEMENT, OR
THE RELATIONSHIP CREATED HEREBY AND WITH RESPECT TO ANY MATTER
FOR WHICH A JURY TRIAL CANNOT BE WAIVED, GUARANTOR AGREES NOT TO
ASSERT ANY SUCH CLAIM AS A COUNTERCLAIM IN OR MOVE TO CONSOLIDATE
SAME WITH ANY ACTION OR PROCEEDING IN WHICH A JURY TRIAL IS
WAIVED.
Section 16. Binding Effect. This Agreement shall be
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binding upon and inure to the benefit of the parties hereto,
their successors and assigns.
IN WITNESS WHEREOF, Guarantor has caused this Guaranty
Agreement to be duly executed to be effective as of the date
first above written.
TOUCHSTONE APPLIED SCIENCE ASSOCIATES, INC.
By:/s/XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx, President
STATE OF NEW YORK )
) ss.:
COUNTY OF ORANGE )
On the 9th day of November, 1998, before me, the
undersigned, a Notary Public in and for said State, personally
appeared Xxxxxx X. Xxxxx, personally known to me or proved to me
on the basis of satisfactory evidence to be the individual whose
name is subscribed to the within instrument and acknowledged to
me that he executed the same in his capacity, and that by his
signature on the instrument, the individual, or person upon
behalf of which the individual acted, executed the instrument.
_________________________________
Notary Public
