1
EXHIBIT 10.19
GUARANTY
THIS GUARANTY (the "GUARANTY") is made as of March 12, 1998, by
IRVINE APARTMENT COMMUNITIES, L.P., a Delaware limited partnership ("GUARANTOR")
in favor of WESTERN NATIONAL SECURITIES D/B/A WESTERN NATIONAL PROPERTY
MANAGEMENT, a California corporation ("WNPM") and the WNPM Indemnities (as
defined in the Partnership Agreement).
1. Except as otherwise provided in this Guaranty, initially
capitalized terms used in this Guaranty without definition are defined in that
certain Irvine Apartment Management Company Partnership Agreement of even date
herewith by and between Apartment Management Company, LLC, a Delaware limited
liability company ("AMC"), and WNPM (the "PARTNERSHIP AGREEMENT"). Under the
terms of the Partnership Agreement, AMC and WNPM have formed Irvine Apartment
Management Company, a California general partnership (the "PARTNERSHIP").
2. (a) Guarantor is an Affiliate of AMC and as such, Guarantor
agrees that WNPM's agreement to enter into the Partnership Agreement is of
substantial and material benefit to AMC. In order to induce WNPM to enter into
the Partnership Agreement, Guarantor hereby unconditionally and irrevocably
guarantees to the WNPM Indemnitees, the full and prompt payment of any AMC
Indemnification Obligation. The obligations guaranteed pursuant to this Section
2 are hereinafter referred to as the "GUARANTEED OBLIGATIONS."
(b) Notwithstanding anything to the contrary contained
herein, Guarantor's maximum aggregate liability under Section 2(a) shall not
exceed Thirty Million Dollars ($30,000,000) (the "MAXIMUM LIABILITY AMOUNT").
3. In accordance with California Civil Code ("CC") Section 2856,
(a) Guarantor waives all rights and defenses available to
Guarantor by reason of CC Sections 2787 to 2855, inclusive, 2899 and
3433 including, without limitation, any and all rights or defenses
Guarantor may have by reason of protection afforded to the principal
with respect to any of the Guaranteed Obligations or to any other
guarantor of any of the Guaranteed Obligations with respect to such
guarantor's obligations under its guaranty, in either case, pursuant to
other laws of this state limiting or discharging the principal's
indebtedness or such other guarantor's obligations; and
(c) Guarantor waives all rights and defenses arising out
of an election of remedies by WNPM Indemnitees, even though that
election of remedies, has destroyed Guarantor's rights of subrogation
and reimbursement against AMC.
1
2
No other provision of this Guaranty shall be construed as limiting the
generality of any of the covenants and waivers set forth in this Paragraph 3.
4. Guarantor represents and warrants to the WNPM Indemnitees that
Guarantor is a member in AMC. In that regard, Guarantor agrees that WNPM
Indemnitees's agreement to enter into the Partnership Agreement is of
substantial and material benefit to Guarantor and further agrees as follows:
(a) Guarantor shall continue to be liable under this
Guaranty and the provisions hereof shall remain in full force and effect
notwithstanding (i) any modification, agreement or stipulation between
AMC and WNPM or their respective successors and assigns, with respect to
the Partnership Agreement or the obligations encompassed thereby,
including, without limitation, the Guaranteed Obligations, (ii) WNPM's
waiver of or failure to enforce any of the terms, covenants or
conditions contained in the Partnership Agreement or in any modification
thereof, (iii) any discharge or release of AMC or any other guarantor
from any liability with respect to the Guaranteed Obligations, (iv) any
loans or financial accommodations made to AMC and (v) the manner or
order by which payments are applied to obligations under the Partnership
Agreement. Without limiting the generality of the foregoing, Guarantor
hereby waives the rights and benefits under CC Section 2819, and agrees
that by doing so Guarantor's liability shall continue even if WNPM
alters any obligations under the Partnership Agreement in any respect or
the WNPM Indemnitees' remedies or rights against AMC are in any way
impaired or suspended without Guarantor's consent.
(b) Guarantor's liability under this Guaranty shall
continue until all Guaranteed Obligations owed to the WNPM Indemnitees
have been satisfied in full.
5. The liability of Guarantor under this Guaranty is a guaranty
of payment and not collectibility and is conditioned and contingent upon the
genuineness, validity, regularity or enforceability of the Partnership Agreement
or other instruments relating to the creation or performance of the Guaranteed
Obligations (unless the lack of enforceability is the result of the Bankruptcy
of AMC) or the pursuit by the WNPM Indemnitees of any remedies which it now has
or may hereafter have with respect thereto under the Partnership Agreement, at
law, in equity or otherwise.
6. Guarantor agrees that the WNPM Indemnitees may enforce this
Guaranty without proceeding against AMC or resorting to or exhausting any
security or collateral of AMC.
7. (a) Guarantor agrees that nothing contained herein shall
prevent the WNPM Indemnitees from suing on the Partnership Agreement and
that the exercise of
2
3
any of the aforesaid rights shall not constitute a legal or equitable
discharge of Guarantor.
(b) Guarantor agrees that Guarantor waives all benefits
and defenses under CC Sections 2847, 2848 and 2849 and agrees that
Guarantor shall have no right of subrogation against AMC, no right of
subrogation against any collateral or security provided for in the
Partnership Agreement and no right of contribution against any other
guarantor unless and until all Guaranteed Obligations have been
indefeasibly paid and satisfied in full, and the WNPM Indemnitees have
released, transferred or disposed of all of its rights, title and
interest in any collateral or security. To the extent the waiver of
Guarantor's rights of subrogation, reimbursement and contribution as set
forth herein is found by a court of competent jurisdiction to be void or
voidable for any reason, Guarantor further agrees that Guarantor's
rights of subrogation and reimbursement against AMC and Guarantor's
rights of subrogation against any collateral or security shall be junior
and subordinate to any rights the WNPM Indemnitees may have against AMC
and to all rights, title and interest the WNPM Indemnitees may have in
such collateral or security, and Guarantor's rights of contribution
against any other guarantor shall be junior and subordinate to any
rights the WNPM Indemnitees may have against such other guarantor. The
WNPM Indemnitees may use, sell or dispose of any item of collateral or
security as it sees fit without regard to Guarantor's subrogation and
contribution rights, and upon disposition or sale, of any item, any and
all rights of Guarantor relating to such item shall terminate. With
respect to the foreclosure of any security interest in any personal
property collateral then securing the Guaranteed Obligations, the WNPM
Indemnitees agrees to give Guarantor 5 days' prior written notice, in
the manner set forth in this Guaranty, of any sale or disposition of any
such personal property collateral, other than collateral which is
perishable, threatens to decline speedily in value, is of a type
customarily sold on a recognized market, or is cash, cash equivalents,
certificates of deposit or the like.
(c) Guarantor's sole right with respect to any such
foreclosure of personal property collateral shall be to bid at such sale
in accordance with applicable law. Guarantor acknowledges and agrees
that the WNPM Indemnitees may also bid at any such sale and in the event
such collateral is sold to the WNPM Indemnitees in whole or in partial
satisfaction of the Guaranteed Obligations (or any portion thereof),
Guarantor shall have no right or interest with respect thereto.
Notwithstanding anything to the contrary contained herein, no provision
of this Guaranty shall be deemed to limit, decrease, or in any way to
diminish any rights of set-off the WNPM Indemnitees may have with
respect to any cash, cash equivalents, certificates of deposit, letters
of credit or the like which may now or hereafter be deposited with the
WNPM Indemnitees by AMC.
3
4
8. Guarantor agrees to withhold the exercise of any and
all rights of subrogation, reimbursement and contribution against AMC,
against any other person or entity, and against any collateral or
security for any of the Guaranteed Obligations, including, without
limitation, any such rights pursuant to CC Sections 2847 and 2848, until
the Guaranteed Obligations have been indefeasibly paid and satisfied in
full, and the WNPM Indemnitees have released, transferred or disposed of
all of its right, title and interest in such collateral or security.
9. All notices, requests and demands to be made hereunder to the
parties hereto shall be in writing (at the addresses set forth below) and shall
be given in writing addressed to the party at its address as it appears below,
and will be deemed effectively given upon personal delivery, confirmation of
receipt of delivery by facsimile, or three (3) days after deposit in the United
States mail, by registered or certified mail, return receipt requested.
To WNPM: c/o Western National Group
0 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xx. Xxxxxxx Xxxxx and Xx. Xxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To Guarantor: Irvine Apartment Communities, L.P.
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xx. Xxxxx Xxxxxx
10. This Guaranty is solely for the benefit of the WNPM
Indemnitees and AMC.
11. The WNPM Indemnitees may not assign this Guaranty without
Guarantor's prior written consent, which consent may be given or withheld in
Guarantor's sole and absolute discretion. As used herein, the singular shall
include the plural, and the masculine shall include the feminine and neuter and
vice versa, if the context so requires.
12. In the event of any dispute or litigation regarding the
enforcement or validity of this Guaranty should result in litigation or
arbitration, the prevailing party in such dispute is entitled to recover from
the other party all reasonable fees, costs and expenses of
4
5
enforcing any right of the prevailing party, including, without limitation,
reasonable attorneys' fees and expenses and expert witness fees.
13. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
14. No provision of this Guaranty may be changed, waived, revoked
or amended without WNPM's prior written consent. If any provision of this
Guaranty or the application of such provision to any person or circumstance is
held invalid, the remainder of this Agreement or the application of such
provision to persons or circumstances other than those to which it is held
invalid will not be affected thereby.
15. This Guaranty embodies the entire agreement among the parties
hereto with respect to the matters set forth herein, and supersedes all prior
agreements among the parties with respect to the matters set forth herein. If
any claim is made by any party relating to any conflict, omission or ambiguity
in this Guaranty, no presumption or burden of proof or persuasion shall be
implied because this Guaranty was prepared by or at the request of a particular
party or its counsel. No failure or delay on the part of the WNPM Indemnitees to
exercise any power, right or privilege under this Guaranty shall impair any such
power, right or privilege, or be construed to be a waiver of any default or an
acquiescence therein, nor shall any single or partial exercise of such power,
right or privilege preclude other or further exercise thereof or of any other
right, power or privilege.
16. This Guaranty is in addition to all other guaranties of
Guarantor and any other guarantors of AMC's obligations to the WNPM Indemnitees.
17. GUARANTOR ACKNOWLEDGES THAT GUARANTOR HAS BEEN AFFORDED THE
OPPORTUNITY TO READ THIS DOCUMENT CAREFULLY AND TO REVIEW IT WITH AN ATTORNEY OF
GUARANTOR'S CHOICE BEFORE SIGNING IT. GUARANTOR ACKNOWLEDGES HAVING READ AND
UNDERSTOOD THE MEANING AND EFFECT OF THIS DOCUMENT BEFORE SIGNING IT.
[SIGNATURE ON NEXT PAGE]
5
6
IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of
the day and year first above written.
GUARANTOR: IRVINE APARTMENT COMMUNITIES, L.P.
a Delaware limited partnership
By: Irvine Apartment Communities, Inc.,
a Maryland corporation,
its general partner
Name: /s/ Xxxxx Xxxxx
-------------------------------------------
Xxxxx Xxxxx
Vice President, Finance and Controller
S-1
