EXHIBIT 10(a)(vi)
CONTINUING UNCONDITIONAL GUARANTY
WHEREAS, Colonial Commercial Sub Corp. ("Borrower") has
entered into a Loan and Security Agreement dated June 24, 1999, (the "Loan
Agreement") with LaSalle Bank National Association ("Bank") pursuant to which
Bank has made or may, in its sole discretion, from time to time hereafter, make
loans and advances to or extend other financial accommodations to Borrower;
WHEREAS, the undersigned is desirous of having Bank extend
and/or continue the extension of credit to Borrower and Bank has required that
Guarantor (as hereinafter defined) execute and deliver this Guaranty to Bank as
a condition to the extension and continuation of credit by Bank; and
WHEREAS, the extension and/or continued extension of credit,
as aforesaid, by Bank is necessary and desirable to the conduct and operation of
the business of Borrower and will inure to the personal and financial benefit of
Guarantor;
NOW, THEREFORE, for value received and in consideration of any
loan, advance, or financial accommodation of any kind whatsoever heretofore, now
or hereafter made, given or granted to Borrower by Bank (including, without
limitation, the Loans as defined in, and made or to be made by Bank to Borrower
pursuant to, the Loan Agreement), the undersigned, and each of them, if there be
more than one, (collectively, the "Guarantor") unconditionally guaranties (i)
the full and prompt payment when due, whether at maturity or earlier, by reason
of acceleration or otherwise, and at all times thereafter, of all of the
indebtedness, liabilities and obligations of every kind and nature of Borrower
to Bank or any parent, affiliate or subsidiary of Bank (the term "Bank" as used
hereafter shall include such parents, affiliates and subsidiaries), howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, joint or several, now or hereafter existing, or due or to become
due, and howsoever owned, held or acquired by Bank, whether through discount,
overdraft, purchase, direct loan or as collateral or otherwise, including
without limitation all obligations and liabilities of Borrower to Bank under the
Loan Agreement and (ii) the prompt, full and faithful discharge by Borrower of
each and every term, condition, agreement, representation and warranty now or
hereafter made by Borrower to Bank (all such indebtedness, liabilities and
obligations being hereinafter referred to as the "Borrower's Liabilities").
Guarantor further agrees to pay all costs and expenses, including, without
limitation, all court costs and reasonable attorneys' and paralegals' fees paid
or incurred by Bank in endeavoring to collect all or any part of Borrower's
Liabilities from, or in prosecuting any action against, Guarantor or any other
guarantor of all or any part of Borrower's Liabilities. All amounts payable by
Guarantor under this Guaranty shall be payable upon demand by Bank.
Notwithstanding any provision of this Guaranty to the
contrary, it is intended that this Guaranty, and any liens and security
interests granted by Guarantor to secure this Guaranty, not constitute a
"Fraudulent Conveyance" (as defined below). Consequently, Guarantor agrees that
if the Guaranty, or any liens or security interests securing this Guaranty,
would, but for the application of this sentence, constitute a Fraudulent
Conveyance, this Guaranty and each such lien and security interest shall be
valid and enforceable only to the maximum extent that would not cause this
Guaranty or such lien or security interest to constitute a Fraudulent
Conveyance, and this Guaranty shall automatically be deemed to have been amended
accordingly at all relevant times. For purposes hereof, "Fraudulent Conveyance"
means a fraudulent conveyance under Section 548 of the "Bankruptcy Code" (as
hereinafter defined) or a fraudulent conveyance or fraudulent transfer under the
provisions of any applicable fraudulent conveyance or fraudulent transfer law or
similar law of any state, nation or other governmental unit, as in effect from
time to time.
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Guarantor hereby agrees that, except as hereinafter provided,
its obligations under this Guaranty shall be unconditional, irrespective of (i)
the validity or enforceability of Borrower's Liabilities or any part thereof, or
of any promissory note or other document evidencing all or any part of
Borrower's Liabilities, (ii) the absence of any attempt to collect Borrower's
Liabilities from Borrower or any other guarantor or other action to enforce the
same, (iii) the waiver or consent by Bank with respect to any provision of any
instrument evidencing Borrower's Liabilities, or any part thereof, or any other
agreement heretofore, now or hereafter executed by Borrower and delivered to
Bank, (iv) failure by Bank to take any steps to perfect and maintain its
security interest in, or to preserve its rights to, any security or collateral
for Borrower's Liabilities, (v) the institution of any proceeding under Chapter
11 of Title 11 of the United States Code (11 U.S.C. ss.101 et seq.), as amended
(the "Bankruptcy Code"), or any similar proceeding, by or against Borrower, or
Bank's election in any such proceeding of the application of Section 1111(b)(2)
of the Bankruptcy Code, (vi) any borrowing or grant of a security interest by
Borrower as debtor-in-possession, under Section 364 of the Bankruptcy Code,
(vii) the disallowance, under Section 502 of the Bankruptcy Code, of all or any
portion of Bank's claim(s) for repayment of Borrower's Liabilities, or (viii)
any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor.
Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of receivership or
bankruptcy of Borrower, protest or notice with respect to Borrower's Liabilities
and all demands whatsoever, and covenants that this Guaranty will not be
discharged, except by complete performance of the obligations and liabilities
contained herein. Upon any default by Borrower as provided in any instrument or
document evidencing all or any part of Borrower's Liabilities, including without
limitation the Loan Agreement, Bank may, at its sole election, proceed directly
and at once, without notice, against Guarantor to collect and recover the full
amount or any portion of Borrower's Liabilities, without first proceeding
against Borrower, or any other person, firm, or corporation, or against any
security or collateral for Borrower's Liabilities.
Bank is hereby authorized, without notice or demand and
without affecting the liability of Guarantor hereunder, to at any time and from
time to time (i) renew, extend, accelerate or otherwise change the time for
payment of, or other terms relating to, Borrower's Liabilities or otherwise
modify, amend or change the terms of any promissory note or other agreement,
document or instrument now or hereafter executed by Borrower and delivered to
Bank; (ii) accept partial payments on Borrower's Liabilities; (iii) take and
hold security or collateral for the payment of Borrower's Liabilities guaranteed
hereby, or for the payment of this Guaranty, or for the payment of any other
guaranties of Borrower's Liabilities or other liabilities of Borrower, and
exchange, enforce, waive and release any such security or collateral; (iv) apply
such security or collateral and direct the order or manner of sale thereof as in
its sole discretion it may determine; and (v) settle, release, compromise,
collect or otherwise liquidate Borrower's Liabilities and any security or
collateral therefor in any manner, without affecting or impairing the
obligations of Guarantor hereunder. Bank shall have the exclusive right to
determine the time and manner of application of any payments or credits, whether
received from Borrower or any other source, and such determination shall be
binding on Guarantor. All such payments and credits may be applied, reversed and
reapplied, in whole or in part, to any of Borrower's Liabilities as Bank shall
determine in its sole discretion without affecting the validity or
enforceability of this Guaranty.
To secure the payment and performance of Guarantor's
obligations and liabilities contained herein, Guarantor grants to Bank a
security interest in all property of Guarantor delivered concurrently herewith
or which is now, or at any time hereafter in transit to, or in the possession,
custody or control of Bank, and all proceeds of all such property. Guarantor
agrees that Bank shall have the rights and remedies of a secured party under the
Uniform Commercial Code of Illinois, as now existing or hereafter amended, with
respect to all of the aforesaid property, including without limitation thereof,
the right to sell or otherwise dispose of any or all of such property and apply
the proceeds of such sale to the payment of Borrower's Liabilities. In addition,
at any time after maturity of Borrower's Liabilities by reason of acceleration
or otherwise, Bank may, in its sole discretion, without notice to Guarantor and
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regardless of the acceptance of any security or collateral for the payment
hereof, appropriate and apply toward the payment of Borrower's Liabilities (i)
any indebtedness due or to become due from Bank to Guarantor, and (ii) any
moneys, credits or other property belonging to Guarantor, at any time held by or
coming into the possession of Bank whether for deposit or otherwise.
Guarantor hereby assumes responsibility for keeping itself
informed of the financial condition of Borrower, and any and all endorsers
and/or other guarantors of any instrument or document evidencing all or any part
of Borrower's Liabilities and of all other circumstances bearing upon the risk
of nonpayment of Borrower's Liabilities or any part thereof that diligent
inquiry would reveal and Guarantor hereby agrees that Bank shall have no duty to
advise Guarantor of information known to Bank regarding such condition or any
such circumstances or to undertake any investigation not a part of its regular
business routine. If Bank, in its sole discretion, undertakes at any time or
from time to time to provide any such information to any Guarantor, Bank shall
be under no obligation to update any such information or to provide any such
information to Guarantor on any subsequent occasion.
Guarantor consents and agrees that Bank shall be under no
obligation to xxxxxxxx any assets in favor of Guarantor or against or in payment
of any or all of Borrower's Liabilities. Guarantor further agrees that, to the
extent that Borrower makes a payment or payments to Bank, or Bank receives any
proceeds of collateral, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to Borrower, its estate, trustee, receiver or any
other party, including, without limitation, Guarantor, under any bankruptcy law,
state or federal law, common law or equitable theory, then to the extent of such
payment or repayment, Borrower's Liabilities or the part thereof which has been
paid, reduced or satisfied by such amount, and Guarantor's obligations hereunder
with respect to such portion of Borrower's Liabilities, shall be reinstated and
continued in full force and effect as of the date such initial payment,
reduction or satisfaction occurred.
Guarantor agrees that any and all claims of Guarantor against
Borrower, any endorser or any other guarantor of all or any part of Borrower's
Liabilities, or against any of Borrower's properties, whether arising by reason
of any payment by Guarantor to Bank pursuant to the provisions hereof, or
otherwise, shall be subordinate and subject in right of payment to the prior
payment, in full, of all of Borrower's Liabilities.
Bank may, without notice to anyone, sell or assign Borrower's
Liabilities or any part thereof, or grant participations therein, and in any
such event each and every immediate or remote assignee or holder of, or
participant in, all or any of Borrower's Liabilities shall have the right to
enforce this Guaranty, by suit or otherwise for the benefit of such assignee,
holder, or participant, as fully as if herein by name specifically given such
right, but Bank shall have an unimpaired right, prior and superior to that of
any such assignee, holder or participant, to enforce this Guaranty for the
benefit of Bank, as to any part of Borrower's Liabilities retained by Bank.
This Guaranty shall be binding upon Guarantor and upon the
successors (including without limitation, any receiver, trustee or debtor in
possession of or for Guarantor) of Guarantor and shall inure to the benefit of
Bank and its successors and assigns. If there is more than one signatory hereto,
all references to Guarantor herein shall include each and every Guarantor and
each and every obligation of Guarantor hereunder shall be the joint and several
obligation of each Guarantor. Each Guarantor that is a corporation or a
partnership hereby represents and warrants that it has all necessary corporate
or partnership authority, as the case may be, to execute and deliver this
Guaranty and to perform its obligations hereunder.
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This Guaranty shall continue in full force and effect, and
Bank shall be entitled to make loans and advances and extend financial
accommodations to Borrower on the faith hereof until such time as Bank has, in
writing, notified Guarantor that all of Borrower's Liabilities have been paid in
full and discharged and the Loan Agreement has been terminated or until Bank has
actually received written notice from any Guarantor of the discontinuance of
this Guaranty as to that Guarantor, or written notice of the death, incompetency
or dissolution of any Guarantor. In case of any discontinuance by, or death,
incompetency or dissolution of, any Guarantor (collectively, a "Termination
Event"), this Guaranty and the obligations of such Guarantor and his or its
heirs, legal representatives, successors or assigns, as the case may be, shall
remain in full force and effect with respect to all of Borrower's Liabilities
incurred prior to the receipt by Bank of written notice of the Terminating
Event. The occurrence of a Terminating Event with respect to one Guarantor shall
not affect or impair the obligations of any other Guarantor hereunder.
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.
THIS GUARANTY SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL
LAWS OF THE STATE OF ILLINOIS.
Guarantor irrevocably agrees that, subject to Bank's sole and
absolute election, ALL ACTIONS OR PROCEEDINGS IN ANY WAY, MANNER OR RESPECT,
ARISING OUT OF OR FROM OR RELATED TO THIS GUARANTY SHALL BE LITIGATED IN COURTS
HAVING SITUS WITHIN THE CITY OF CHICAGO, STATE OF ILLINOIS. GUARANTOR HEREBY
CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS
LOCATED WITHIN SAID CITY AND STATE. Guarantor hereby irrevocably appoints and
designates the Secretary of State of Illinois, whose address is Springfield,
Illinois (or any other person having and maintaining a place of business in such
state whom Guarantor may from time to time hereafter designate upon ten (10)
days written notice to Bank and who Bank has agreed in its sole discretion in
writing is satisfactory and who has executed an agreement in form and substance
satisfactory to Bank agreeing to act as such attorney and agent), as Guarantor's
true and lawful attorney and duly authorized agent for acceptance of service of
legal process. Guarantor agrees that service of such process upon such person
shall constitute personal service of such process upon Guarantor. GUARANTOR
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY
LITIGATION BROUGHT AGAINST GUARANTOR BY BANK IN ACCORDANCE WITH THIS PARAGRAPH.
GUARANTOR HEREBY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY
ACTION OR PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS GUARANTY.
If there is attached to this Guaranty a Rider A - Special
Provisions, such Rider is by this reference incorporated into and made a part of
this Guaranty.
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IN WITNESS WHEREOF, this Guaranty has been duly executed by the
undersigned as of this 24th day of June, 1999.
Colonial Commercial Corp.
By____________________________
Its___________________________
Address:
0000 Xxxxxxxxx Xxxxxxxx, Xxxxx 000-X
Xxxxxxxxx, Xxx Xxxx 00000-0000
RIDER A - SPECIAL PROVISIONS
This Rider A - Special Provisions is attached to and made a
part of that certain Continuing Unconditional Guaranty (the "Guaranty") of even
date herewith executed by Colonial Commercial Corp. ("Guarantor") in favor of
LaSalle Bank National Association ("Bank").
1. Notwithstanding anything to the contrary contained in the
Guaranty, no payment made by or for the account of Guarantor including, without
limitation, (i) a payment made by Guarantor in respect of Borrower's Liabilities
or (ii) a payment made by any other person under any other guaranty, shall
entitle the Guarantor by subrogation or otherwise, to any payment from Borrower
or from or out of any property of Borrower and Guarantor shall not exercise any
right or remedy against Borrower or any property of Borrower by reason of any
performance by Guarantor under the Guaranty.
Colonial Commercial Corp.
By_______________________________
Its______________________________
Address:
0000 Xxxxxxxxx Xxxxxxxx
Xxxxx 000-X
Xxxxxxxxx, Xxx Xxxx 00000-0000
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