CONTINUING UNCONDITIONAL GUARANTY
This
CONTINUING UNCONDITIONAL GUARANTY (this “Guaranty”),
is
made this 24th day of August, 2007, by LOGISTICAL
SUPPORT, INC.,
a Utah
corporation, having a mailing address at 00000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxxxx 00000 (the “Guarantor”)
in
favor of and for the benefit and security of DUTCHESS
PRIVATE EQUITIES FUND, LTD.,
having
a mailing address at 00 Xxxxxxxxxxxx Xxxxxx, Xxxxx 0, Xxxxxx, Xxxxxxxxxxxxx
00000 (the “Secured
Party”).
WHEREAS,
pursuant to one or more promissory notes or other debentures or instruments,
including, without limitation, that certain Purchase Order Financing Agreement
(as amended or otherwise modified from time to time, the “Finance
Agreement”)
of
even date herewith between Logistical Support, LLC (the “Company”)
and
Secured Party (collectively with the Finance Agreement, as amended or otherwise
modified from time to time, collectively, the “PO
Financing”),
the
Secured Party has agreed to make certain loans and other financial
accommodations to the Company;
WHEREAS,
Guarantor is desirous of having the Secured Party extend and/or continue the
extension of credit to the Company, and the Secured Party has required that
Guarantor execute and deliver this Guaranty to the Secured Party, as a condition
to the extension and continuation of credit by the Secured Party;
and
WHEREAS,
the extension and/or continued extension of credit, as aforesaid, by the Secured
Party is necessary and desirable to the conduct and operation of the business
of
the Company, and Guarantor will derive substantial benefits from the credit
made
available to the Company pursuant to the PO Financing;
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 the Company by the Secured Party, Guarantor agrees
as
follows:
1. 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 the Company to the Secured Party or any parent, affiliate
or
subsidiary of the Secured Party (the terms “Secured Party” 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 the Secured Party, whether through discount,
overdraft, purchase, direct loan or as collateral or otherwise, including,
without limitation, all obligations and liabilities of the Company to the
Secured Party under the PO Financing, and (ii) the prompt, full and faithful
discharge by the Company of each and every term, condition, agreement,
representation and warranty now or hereafter made by the Company to Secured
Party (all such indebtedness, liabilities and obligations being hereinafter
collectively referred to as the “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 Secured Party in endeavoring to collect all or any part of the
Liabilities from, or in prosecuting any action against, Guarantor. All amounts
payable by Guarantor under this Guaranty shall be payable by Guarantor upon
demand by Secured Party.
2. 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 this 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.
3. Guarantor
hereby agrees that this Guaranty is a guaranty of payment and performance and
not of collection, and that, except as hereinafter provided, its obligations
under this Guaranty shall be unconditional, irrespective of (i) the validity
or
enforceability of the Liabilities or any part thereof, or of any promissory
note
or other document evidencing all or any part of the Liabilities, (ii) the
absence of any attempt to collect Liabilities from the Company or any other
guarantor or other action to enforce the same, (iii) the waiver or consent
by
Secured Party with respect to any provision of any instrument evidencing
Liabilities, or any part thereof, or any other agreement heretofore, now or
hereafter executed by Company and delivered to Secured Party, (iv) failure
by
Secured Party to take any steps to perfect and maintain its security interest
in, or to preserve its rights to, any security or collateral for Liabilities,
(v) the institution of any proceeding under Chapter 11 of Title 11 of the United
States Code (11 U.S.C. §101 et seq.), as amended (the “Bankruptcy
Code”)
or any
similar or analogous statutory or nonstatutory proceedings under any other
law,
whether state, provincial or federal, now existing or hereafter existing for
relief of the debtors, by or against Company, (vi) Secured Party’s election in
any such proceeding of the application of Section 1111(b)(2) of the Bankruptcy
Code, (vii) any borrowing or grant of a security interest by Company as
debtor-in-possession, under Section 364 of the Bankruptcy Code, (viii) the
disallowance, under Section 502 of the Bankruptcy Code, of all or any portion
of
Secured Party’s claim(s) for repayment of Liabilities, or (ix) any other
circumstance which might otherwise constitute a legal or equitable discharge
or
defense of a guarantor.
4. Guarantor
hereby waives diligence, presentment, demand of payment, filing of claims with
a
court in the event of receivership, insolvency or bankruptcy of the Company,
protest or notice with respect to 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 the Company as provided in any instrument or document evidencing
all
or any part of Liabilities, including, without limitation, the PO Financing,
Secured Party 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 Liabilities, without first proceeding against the Company, or any other
person, firm, or corporation, or against any security or collateral for
Liabilities.
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5. Secured
Party is hereby authorized, without notice or demand and without affecting
the
liability of Guarantor, 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, Liabilities or otherwise modify, amend or change the terms of any promissory
note or other agreement, document or instrument now or hereafter executed by
the
Company and delivered to Secured Party; (ii) accept partial payments on
Liabilities; (iii) take and hold security or collateral for the payment of
Liabilities guaranteed hereby, or for the payment of this Guaranty, or for
the
payment of any other guaranties of Liabilities or other liabilities of the
Company, 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 Liabilities and
any
security or collateral therefor in any manner, without affecting or impairing
the obligations of Guarantor hereunder. Secured Party shall have the exclusive
right to determine the time and manner of application of any payments or
credits, whether received from the Company 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 the
Liabilities as Secured Party shall determine in its sole discretion without
affecting the validity or enforceability of this Guaranty.
6. To
secure
the payment and performance of the Liabilities, including the obligations and
liabilities contained herein, the Company has granted to Secured Party a
security interest in certain property of the Company pursuant to a Security
Agreement dated as of even date herewith among the Company and Secured Party
(the “Security
Agreement”).
Guarantor agrees that Secured Party shall have the rights and remedies of a
secured party under the UCC (as defined in the Security Agreement), 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 Liabilities. In addition, Secured Party may, in its sole discretion, without
notice to Guarantor and regardless of the acceptance of any security or
collateral for the payment hereof, appropriate and apply toward the payment
of
Liabilities (i) any indebtedness due or to become due from Secured Party to
Guarantor, and (ii) any moneys, credits or other property belonging to
Guarantor, at any time held by or coming into the possession of Secured Party,
whether for deposit or otherwise.
7. Guarantor
hereby assumes responsibility for keeping itself informed of the financial
condition of the Company, and any and all endorsers and/or other guarantors
of
any instrument or document evidencing all or any part of Liabilities and of
all
other circumstances bearing upon the risk of nonpayment of Liabilities or any
part thereof that diligent inquiry would reveal, and Guarantor hereby agrees
that Secured Party shall not have any duty to advise Guarantor of information
known to Secured Party regarding such condition or any such circumstances or
to
undertake any investigation not a part of its regular business routine. If
Secured Party, in its sole discretion, undertakes at any time or from time
to
time to provide any such information to Guarantor, Secured Party shall be under
no obligation to update any such information or to provide any such information
to Guarantor on any subsequent occasion.
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8. Guarantor
consents and agrees that Secured Party shall be under no obligation to marshal
any assets in favor of Guarantor or against or in payment of any or all of
Liabilities. Guarantor further agrees that, to the extent that the Company
make
a payment or payments to Secured Party, or Secured Party 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 the Company, its estate, trustee, receiver or any
other
party, including, without limitation, Guarantor, under any bankruptcy law,
state, provincial or federal law, common law or equitable theory, then to the
extent of such payment or repayment, 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 Liabilities, shall be reinstated
and
continued in full force and effect as of the date such initial payment,
reduction or satisfaction occurred.
9. Guarantor
agrees that any and all claims of Guarantor against the Company, any endorser
or
any other guarantor of all or any part of Liabilities, or against the Company’s
properties, whether arising by reason of any payment by Guarantor to Secured
Party 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
Liabilities.
10. Secured
Party may, without notice to anyone, sell or assign 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
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 Secured Party 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 Secured Party, as
to
any part of Liabilities retained by Secured Party.
11. 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 Secured Party and
its
respective successors and assigns. Guarantor hereby represents and warrants
that
it has all necessary corporate authority to execute and deliver this Guaranty
and to perform its obligations hereunder.
12. This
Guaranty shall continue in full force and effect, and Secured Party shall be
entitled to make loans and advances and extend financial accommodations to
the
Company on the faith hereof until such time as Secured Party has, in writing,
notified Guarantor that all of Liabilities have been paid in full and discharged
or until Secured Party has actually received written notice from Guarantor
of
the discontinuance of this Guaranty, or written notice of the dissolution of
Guarantor. In case of any discontinuance by, or dissolution of, Guarantor
(collectively, a “Termination
Event”),
this
Guaranty and the obligations of Guarantor and its successors or assigns, as
the
case may be, shall remain in full force and effect with respect to all of
Liabilities incurred prior to the receipt by Secured Party of written notice
of
the Termination Event.
13. 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.
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14. THIS
GUARANTY SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS, without regard to its conflicts of law
principles.
15. Guarantor
irrevocably agrees that, subject to Secured Party’s sole and absolute election,
all disputes arising under this Guaranty will be submitted to arbitration in
Boston, Massachusetts before a single arbitrator of the American Arbitration
Association (“AAA”). The arbitrator shall be selected by application of the
rules of the AAA, or by mutual agreement of the parties, except that such
arbitrator shall be an attorney admitted to practice law in the Commonwealth
of
Massachusetts. No party to this agreement will challenge the jurisdiction or
venue provisions as provided in this section. Nothing in this section shall
limit the Secured Party’s right to obtain an injunction for a breach of this
Guaranty from a court of law.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, this Guaranty has been duly executed by the undersigned as
of
this ____ day of August, 2007.
| GUARANTOR: | ||
| LOGISTICAL SUPPORT, LLC. | ||
| |
|
|
| By: | /s/ | |
|
Name: Xxxxx X. Xxxxxxx |
||
|
Title: Chief
Executive Order
|
||
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ACKNOWLEDGMENT
OF SIGNATURES
|
STATE
OF _________________
|
}
|
|
|
}
|
SS
|
|
|
COUNTY
OF _______________
|
}
|
I,
___________________________, a Notary Public in and for the state and county
aforesaid, so hereby certify that before me this day personally appeared
_______________________, known to me to be the same person whose name is
subscribed to the foregoing Continuing Unconditional Guaranty and known to
me to
be the _____________________________ of the corporation that executed the
foregoing Continuing Unconditional Guaranty, and acknowledged to me that he
executed and delivered the foregoing consent as his free and voluntary act,
for
the uses set forth therein.
IN
WITNESS WHEREOF, I have hereunto set my hand and official seal this ______
day
of August, 2007.
|
_________________________
Notary
Public
My
Commission Expires: ______
|
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