LIMITED GUARANTY
1. For and in consideration of the sum of TEN DOLLARS ($10.00) and other
good and valuable considerations in hand paid to INPUT/OUTPUT, INC.,
(hereinafter called "GUARANTOR", whether one or more), a Delaware corporation,
the receipt and sufficiency of which considerations are hereby acknowledged, and
for the purpose of enabling IPOP MANAGEMENT, INC., a Delaware corporation
(hereinafter called "DEBTOR"), to borrow certain funds from THE VARIABLE ANNUITY
LIFE INSURANCE COMPANY, (hereinafter called "HOLDER") a Texas corporation, and
to induce Holder to advance to Debtor the proceeds of that certain Promissory
Note of even date executed by Debtor in the original principal amount of
$12,550,000.00 (the "NOTE") payment of which is secured by that certain Deed of
Trust and Security Agreement (the "DEED OF TRUST") covering the property therein
described (the "MORTGAGED PROPERTY"), any of the other collateral securing
payment of the Note (the "OTHER COLLATERAL") and all other instruments securing
the payment of the Note (which together with the Deed of Trust are herein
collectively referred to as the "SECURITY INSTRUMENTS"), and recognizing that
but for this Guaranty (i) the loan evidenced by the Note would not be made by
the Holder to the Debtor, and (ii) the funds would not be advanced thereunder,
Guarantor hereby unconditionally and jointly and severally guarantees to Holder
the prompt payment (or accounting to Holder by delivery of funds) for the
following (hereinafter called the "OBLIGATIONS"): (a) all condemnation awards
and proceeds and insurance proceeds received by Debtor or Guarantor (to the
extent same have not theretofore been applied toward payment of the sums due
under the Note or used for repair, restoration or replacement of the Mortgaged
Property and, with respect to such insurance proceeds which represent proceeds
paid under any rent insurance, business interruption insurance or other similar
types of insurance, to the additional extent such rent, business interruption
insurance or other similar insurance proceeds have not theretofore been applied
toward the payment of taxes and insurance premiums); (b) all amounts necessary
to repair any damage to the Mortgaged Property, excluding normal wear and tear,
caused by acts or omissions of Debtor, its agents, employees, or contractors;
(c) all security deposits; (d) failure of Debtor to pay, in accordance with the
Deed of Trust, taxes, assessments or other charges which can create liens on any
portion of the Mortgaged Property or the Other Collateral and are payable under
the Security Instruments (to the full extent of any such taxes, assessments or
other charges); (e) failure of Debtor to pay charges for labor or materials or
other charges which can create liens on any portion of the Mortgaged Property or
the Other Collateral (to the full extent of the amount rightfully claimed by any
such claimant); (f) prepaid rent and rental or other income derived from the
Mortgaged Property or the Other Collateral from and after the occurrence of a
default under the Note or the Security Instruments (whether any of such
condemnation awards, insurance proceeds, income or other funds derived from the
Mortgaged Property are held by Holder or received by Debtor or Guarantor); (g)
any loss incurred by Holder as a result of Debtor's forfeiture of the Mortgaged
Property resulting from criminal activity by any person whether or not such
criminal activity is conducted on or in any manner relates to the Mortgaged
Property or the Other Collateral; (h) all sums due Holder, excluding payments of
principal and accrued interest due pursuant to the Note, following exercise by
Holder of its right to perform Debtor's obligations under the Security
Instruments to preserve, protect or defend the Mortgaged Property as Collateral
for the Note after notice and opportunity to cure, if any, as provided in the
Security Instruments; (i) any loss, damage or injury sustained by Holder arising
from the breach of any warranty or representation of Debtor contained in any
affidavit made by or on behalf of Debtor or in any of the Security Instruments
regarding hazardous wastes or other hazardous or toxic substances; (j) any loss,
damage, or injury sustained by Holder arising from the breach of the warranties,
representations, covenants and/or indemnities given by Xxxxxx and contained in
Article 11 of the Mortgage relating to "HAZARDOUS MATERIALS" (as therein
defined); and (k) all reasonable costs, attorneys' fees and expenses incurred or
expended by Holder in collecting any of the foregoing or due to any default in
the performance of the foregoing or in enforcing any right granted hereunder.
2. Notwithstanding the provisions contained in the Note relating to the
limitation on the liability of Debtor for failure to perform thereunder, the
Guarantor is and shall remain liable to Holder in accordance with the terms and
provisions of this Guaranty.
3. All amounts becoming payable by Guarantor to Holder under this
Guaranty shall be payable at Holder's offices in Houston, Xxxxxx County, Texas,
or such other place as Holder may from time to time designate.
4. In each event whenever any of the Obligations shall become due and
remain unpaid (howsoever the maturity thereof may have occurred), Guarantor,
will, on demand, pay the amount due thereon to Holder, without further notice of
dishonor and without any notice having been given to Guarantor previous to such
demand of the acceptance by Holder of this Guaranty or of the creating or
incurring of such indebtedness Guarantor specifically agrees that it shall not
be necessary or required in order to enforce Guarantor's obligations under this
Guaranty that Holder have made demand for payment upon Debtor or any other
person liable thereon or have made protest thereof or have given notice to
Debtor or any other party liable thereon of maturity or nonpayment of said
Obligations, or have realized upon or sought the benefits of any security for
the Obligations.
5. Guarantor specifically waives any notice of acceptance of this
Guaranty by Holder and of the creation, advancement, existence, extension,
renewal or rearrangement of the Note or the Security Instruments, or increase or
reduction of the rate of interest thereon, or any indulgence with respect
thereto, or any part thereof, and of nonpayment thereof or default thereon, and
waives grace, demand, protest, presentment and notice of demand, notice of
intention to accelerate maturity, notice of acceleration, protest, and
presentment with respect to the Note, and waives notice of the amount of the
Obligations outstanding at any time, and agrees that the maturity of the
Obligations, or any part thereof, may be accelerated, extended, modified,
amended or renewed or any other indulgence may be granted with respect thereto
by Holder at its will or as may be agreed by Debtor without notice to or further
consent by Guarantor, at any time or times Guarantor acknowledges that Holder
shall have the right to off-set against any funds of Debtor held by Holder
(including, without limitation, escrows for taxes and insurance) pursuant to the
Note and any of the Security Instruments. Guarantor also waives defenses and
claims based on principles of suretyship and/or guaranty.
6. Guarantor agrees that no renewal, extension or rearrangement of or any
other indulgence with respect to the Note or the Security Instruments, or any
part thereof, or increase or reduction of the rate of interest thereon, no
release of or substitution for any security or other guaranty now or hereafter
held by Holder for payment of the Note or the Obligations, or of any part
thereof, no release of Debtor, or of any other person primarily or secondarily
liable on the Note or the Obligations, or any part thereof, and no delay or
omission or lack of diligence or care in exercising any right or power with
respect to the Note or the Obligations or any security therefor or guaranty
thereof or under this Guaranty shall in any manner impair or affect the rights
of Holder or the obligations and liability of Guarantor hereunder. Guarantor
specifically agrees that it shall not be necessary or required, and that
Guarantor shall not be entitled to require, that Holder file suit or proceed to
obtain or assert a claim for personal judgment against Debtor for the
Obligations or make any effort at collection of the Obligations from Debtor or
foreclose against or seek to realize upon any security now or hereafter existing
for the Note or the Obligations or file suit or proceed to obtain or assert a
claim for personal judgment against any other party (maker, guarantor, endorser
or surety) liable for the Obligations or make any effort at collection of the
Obligations from any such other party or exercise or assert any other right or
remedy to which Holder is or may be entitled in connection with the Note or the
Obligations or any security or other guaranty therefor or assert or file any
claim against the assets or estate of Debtor or any other guarantor or other
person liable for the Obligations, or any part thereof, before or as
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a condition of enforcing the liability of Guarantor under this Guaranty or
requiring payment of the Obligations by Guarantor hereunder, or at any time
thereafter. Guarantor expressly waives any right to the benefit of or to
require or control application of any security or the proceeds of any
security now existing or hereafter obtained by Holder as security for the
Obligations, or any part thereof, and agrees that Holder shall have no duty
insofar as Guarantor is concerned to apply upon any of the Obligations any
monies, payments or other property at any time received by or paid to or in
the possession of Holder, except as Holder shall determine in its sole
discretion. Guarantor specifically agrees that Guarantor shall not have any
recourse or action against Holder by reason of any action Holder may take or
omit to take in connection with the Note, the Security Instruments or the
Obligations, the collection of any sums or amounts herein mentioned, or in
connection with any security or any other guaranty at any time existing
therefor.
7. Guarantor agrees to the terms, provisions and conditions of the Note
and of any renewal, extension, modification or rearrangement note or notes or
other agreements which may have been or may hereafter be executed by Debtor
evidencing or in connection with the Note or the Obligations or any part
thereof, and agrees that Guarantor's liability hereunder shall in no manner be
affected, impaired or released by reason of any term, provision or condition of
any such note or other agreement or by failure, refusal or omission of Holder to
enforce or observe any of same or any action taken or omitted to be taken by
Holder pursuant thereto or in connection therewith.
8. Guarantor absolutely and unconditionally covenants and agrees that in
the event that Debtor does not or is unable so to pay or perform the Obligations
for any reason, including, without limitation, liquidation, dissolution,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of or other similar
proceedings affecting the status, composition, identity, existence, assets or
obligations of Debtor, or the disaffirmance or termination of any of the
Obligations in or as a result of any such proceeding, Guarantor shall pay and
perform the Obligations and that no such occurrence shall in any way affect
Guarantor's obligations hereunder.
9. If the status of Debtor changes, including, but not limited to, a
merger, dissolution, consolidation or reorganization, this Guaranty shall
continue and also cover the indebtedness and Obligations of Debtor under the new
status according to the terms hereof.
10. In the event any payment of Debtor to Holder is held to constitute a
preference under the bankruptcy laws, or if for any other reason Holder is
required to refund such payment or pay the amount thereof to any other party,
such payment by Debtor to Holder shall not constitute a release of Guarantor
from any liability hereunder, but Guarantor agrees to pay such amount to Holder
upon demand and this Guaranty shall continue to be effective or shall be
reinstated, as the case may be, to the extent of any such payment or payments.
11. All payments made upon the Obligations at any time shall be deemed to
have been paid by Xxxxxx unless express notice in writing is given to the Holder
at the time of payment by Guarantor that Xxxxxx has been paid by him. The
payment by Guarantor of any amount pursuant to this Guaranty shall not in
anywise entitle Guarantor to any right, title or interest (whether by way of
subrogation or otherwise) in and to any of the Obligations or any proceeds
thereof, or any security therefor, unless and until the full amount owing to
Holder on the Obligations has been fully paid, but when the same has been fully
paid Guarantor shall be subrogated as to any payments made by it to the rights
of Holder as against Debtor and/or any endorsers, sureties or other guarantors.
12. If any or all of the Obligations are now or hereafter secured in whole
or in part, Guarantor agrees that Holder may, from time to time, at its
discretion, and with or without valuable consideration, allow
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substitution or withdrawal of collateral or release all or any part of such
security, without notice or consent by Guarantor, and without in anywise
impairing, diminishing or releasing the liability of Guarantor hereunder.
13. Guarantor agrees to pay to Holder all reasonable costs and expenses
(including court costs and attorneys' fees) incurred by the Holder in the
enforcement of this Guaranty.
14. No provision contained herein or in the Note or any Security
Instruments executed by the Debtor or Guarantor shall require the payment or
permit the collection of interest in excess of the maximum permitted by
applicable usury laws. If any excess of interest in such respect is provided
for herein or in the Note or any Security Instruments, the provisions of this
paragraph shall govern and neither the Debtor nor Guarantor shall be obligated
to pay the sum of such interest to the extent that it is in excess of the amount
permitted by law; the intention of the parties being to conform strictly to
usury laws now or hereafter in effect and applicable to the Obligations, and
shall be held subject to reduction to the amount allowed under applicable usury
laws as now or hereafter construed by the courts having jurisdiction thereof.
15. Xxxxxxxxx agrees, to the full extent it may legally do so, that suit
may be brought against Guarantor with or without making Debtor a party to such
suit (as Holder may elect).
16. Guarantor waives all defenses given to sureties or guarantors at law
or in equity other than actual payment of the Obligations. The failure by Holder
to file or enforce a claim against the estate (either in administration,
bankruptcy or other proceeding) of Debtor or of any other or others shall not
affect the liability of Guarantor hereunder.
17. This Guaranty is intended for and shall inure to the benefit of
Holder and each and every other person who shall from time to time be or
become the owner or holder of the Note, and each and every reference herein
to "HOLDER" shall also include and refer to each and every successor or
assignee of Holder at any time holding or owning any part of or interest in
any part of the Note. This contract of guaranty shall be transferable, it
being understood and stipulated that upon the assignment or transfer by
Holder of any of the Note (or any part thereof or interest therein thus
transferred or assigned by Xxxxxx) shall also, unless provided otherwise by
Holder in its assignment, have and may exercise all the rights granted to
Holder under this Guaranty to the extent of the part of or interest in the
Note thus assigned or transferred to said person.
18. If any of the following events occur or be continuing:
(a) An event of default occurs under the terms of the Note or any of
the Security Instruments and continues beyond the time provided
therein, if any, for the curing of such default; or
(b) If Guarantor defaults in the performance or observance of any
agreement, covenant, term or condition contained herein; or
(c) If Guarantor makes an assignment for the benefit of creditors; or
(d) If Guarantor petitions or applies to any tribunal for the
appointment of a trustee or receiver of the business, estate or
assets or of any substantial part of the business, estate or
assets of Guarantor or commences any proceedings relating to
Guarantor under any bankruptcy, reorganization, arrangement,
insolvency, readjustment of
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debt, dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect; or
(e) If any such petition or application is filed or any such
proceedings are commenced against Guarantor and Guarantor by any
act indicates its approval thereof, consent thereto, or
acquiescence therein, or an order is entered appointing any such
trustee or receiver, or adjudicating Guarantor bankrupt or
insolvent or approving the petition in any such proceedings, and
such order remains in effect for more than sixty (60) days.
then an event of default under this Guaranty shall have occurred and the Holder
may, at its option, declare the Obligations to be, and the Obligations shall
thereupon be and become forthwith due and payable together with interest accrued
thereon under the terms of and with the effect provided in the Obligations, and
this Guaranty.
19. Any notice or demand to Guarantor hereunder or in connection herewith
may be given and shall conclusively be deemed and considered to have been given
and received upon the deposit thereof, in writing, in the U.S. Mail, duly
stamped and addressed to Guarantor at the address of Guarantor shown below; but
actual notice, however given or received, shall always be effective. The last
preceding sentence shall not be construed in anywise to affect or impair any
waiver of notice or demand herein provided or to require giving of notice or
demand to or upon Guarantor in any situation or for any reason.
20. Unless the context clearly indicates otherwise, "GUARANTOR" shall mean
the guarantors hereunder or any of them. The obligations of the guarantor
hereunder shall be joint and several. Suit may be brought against said
guarantors, and against any one or more of them, less than all, without
impairing the rights of Holder against the others of said guarantors; and Holder
may compromise with any one of the guarantors for such sums or sum as it may see
fit and release such of said guarantors from all further liability to Holder for
such indebtedness without impairing the right of Holder to demand and collect
the balance of such indebtedness from others of said guarantors not so released;
but it is agreed among said guarantors themselves, however, that such
compromising and release shall in nowise impair the rights of said guarantors as
among themselves.
21. The rights of Holder are cumulative and shall not be exhausted by its
exercise of any of its rights hereunder or otherwise against Guarantor or by any
number of successive actions until and unless all Obligations have been paid or
performed.
22. Guarantor hereby subordinates any and all indebtedness of Debtor now
or hereafter owing to any Guarantor to all indebtedness of Debtor to Holder, and
agrees with the Holder that Guarantor shall not demand or accept any payment of
principal or interest from the Debtor if at such time Debtor is in default under
the Note or the Security Instruments and shall not claim any offset or other
reduction of Guarantor's liability hereunder because of any such indebtedness
and shall not take any action to obtain any of the security described in and
encumbered by any security in favor of Xxxxxx.
23. The rights of Holder are cumulative and shall not be exhausted by its
exercise of any of its rights hereunder or otherwise against Guarantor or by any
number of successive actions until and unless all indebtedness has been paid,
all Obligations have been performed and each of the Obligations of Guarantor
hereunder has been performed.
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24. This Guaranty shall be deemed to have been made under and shall be
governed by the laws of the State of Texas in all respects and shall not be
waived, altered, modified or mended as to any of its terms or provisions except
in writing duly signed by Xxxxxx and Guarantor.
25. This Guaranty shall bind the successors and assigns of Guarantor and
shall inure to the benefit of all transferees, credit participants, assignees,
and/or endorsees of Holder. The use of any gender herein shall include the
other genders. A determination that any provision of this Guaranty is
unenforceable or invalid shall not affect the enforceability or validity of any
other provision.
26. The board of directors of each guarantor that is a corporation and
each general partner of each guarantor that is a partnership, has determined
that this Limited Guaranty may reasonably be expected to benefit such guarantor,
directly or indirectly.
27. Notwithstanding anything herein contained to the contrary, it is
understood and agreed that this is a limited guaranty, and that, with the
exception of the Obligations, Guarantor is not liable for payment of the Note.
IN WITNESS WHEREOF, the undersigned has caused this Limited Guaranty to
be executed under seal as of the 29 day of August, 1996.
INPUT/OUTPUT, INC.,
A DELAWARE CORPORATION
BY: /s/ XXXXXX X. XXXXXXXX
XXXXXX VICE PRESIDENT, CHIEF FINANCIAL
OFFICER & SECRETARY
ADDRESS: 00000 XXXX XXXXXXX XXXXXXXXX
XXXXX 000
XXXXXXXX, XXXXX 00000
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