GUARANTY AGREEMENT
EXHIBIT
10.6
THIS
GUARANTY AGREEMENT (this “Guaranty”) is made as
of August 16, 2010 by and between each of the undersigned (each a “Guarantor” and
collectively, the “Guarantors”), and
Vicis Capital Master Fund (“Vicis”), a sub-trust
of Vicis Capital Series Master Trust, a unit trust organized and existing under
the laws of the Cayman Islands.
R E C I T A L
S
WHEREAS,
Each Guarantor is a wholly owned subsidiary of The Amacore Group, Inc., a
Delaware corporation (“Issuer”).
WHEREAS,
pursuant to a Securities Purchase Agreement of even date herewith by and between
Vicis and Issuer (as amended or modified from time to time, the “Purchase Agreement”),
Vicis has made or will make an investment (the “Investment”) in
Issuer’s 15% Senior Secured Convertible Notes due June 30, 2011 (the “Acquired
Notes”).
WHEREAS,
it is a condition precedent to Vicis’s investment in the Acquired Notes that
each Guarantor execute and deliver to Vicis a guaranty in the form
hereof.
WHEREAS,
this is the Guaranty Agreement referred to in the Purchase
Agreement.
NOW,
THEREFORE, in consideration of the recitals and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
each Guarantor hereby agrees with Vicis as follows:
ARTICLE
1
DEFINITIONS
When used
in this Guaranty, capitalized terms shall have the respective meanings ascribed
to them in the Purchase Agreement, the preamble, the recitals and as
follows:
1.1 Event of
Default. “Event of Default” shall have the meaning specified
in the Purchase Agreement.
1.2 Guaranty. “Guaranty”
shall mean this Guaranty, as the same shall be amended, supplemented or
otherwise modified from time to time in accordance with the terms
hereof.
1.3 Law. “Law”
shall mean any federal, state, local or other law, rule, regulation or
governmental requirement of any kind, and the rules, regulations,
interpretations and orders promulgated thereunder.
1.4 Obligations. “Obligations”
shall mean (a) the obligation to pay interest and principal on the Acquired
Notes as required by the terms thereof and the Transaction Documents; (b)
obligations associated with any renewal, extension, refinancing, or amendment to
the terms of the Acquired Notes; (c) all debts, liabilities, obligations,
covenants and agreements of the Issuer and Guarantors to Vicis contained in the
Transaction Documents; and (d) any and all other debts, liabilities and
obligations of the Guarantors and Issuer to Vicis.
1.5 Person. “Person”
shall mean and include an individual, partnership, corporation, trust,
unincorporated association and any unit, department or agency of
government.
ARTICLE
2
THE
GUARANTY
2.1 The
Guaranty. Each Guarantor, for itself, its successors and
assigns, hereby unconditionally and absolutely guarantees to Vicis the full and
complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of each of the Obligations. This is a
guaranty of payment and performance and not of collection.
2.2 Waivers and
Consents.
(a) Each
Guarantor acknowledges that the obligations undertaken herein involve the
guaranty of obligations of a Person other than such Guarantor and, in full
recognition of that fact, such Guarantor consents and agrees that Vicis may, at
any time and from time to time, without notice or demand, and without affecting
the enforceability or continuing effectiveness hereof: (i) supplement, modify,
amend, extend, renew, accelerate or otherwise change the time for payment or the
other terms of the Obligations or any part thereof, including without limitation
any increase or decrease of the principal amount thereof or the rate(s) of
interest thereon; (ii) supplement, modify, amend or waive, or enter into or give
any agreement, approval or consent with respect to, the Obligations or any part
thereof, or any of the Transaction Documents or any additional security or
guaranties, or any condition, covenant, default, remedy, right, representation
or term thereof or thereunder; (iii) accept new or additional instruments,
documents or agreements in exchange for or relative to any of the Transaction
Documents or the Obligations or any part thereof; (iv) accept partial payments
on the Obligations; (v) receive and hold additional security or guaranties for
the Obligations or any part thereof; (vi) release, reconvey, terminate, waive,
abandon, fail to perfect, subordinate, exchange, substitute, transfer and/or
enforce any security or guaranties, and apply any security and direct the order
or manner of sale thereof as Vicis in its sole and absolute discretion may
determine; (vii) release any Person from any personal liability with respect to
the Obligations or any part thereof; (viii) settle, release on terms
satisfactory to Vicis or by operation of applicable Law or otherwise, liquidate
or enforce any Obligations and any security or guaranty in any manner, consent
to the transfer of any security and bid and purchase at any sale; and/or (ix)
consent to the merger, change or any other restructuring or termination of the
corporate existence of Issuer or any other Person, and correspondingly
restructure the Obligations, and any such merger, change, restructuring or
termination shall not affect the liability of such Guarantor or the continuing
effectiveness hereof, or the enforceability hereof with respect to all or any
part of the Obligations.
(b) Upon the
occurrence and during the continuance of any Event of Default, Vicis may enforce
this Guaranty independently of any other remedy, guaranty or security Vicis at
any time may have or hold in connection with the Obligations, and it shall not
be necessary for Vicis to marshal assets in favor of Issuer, any other guarantor
of the Obligations or any other Person or to proceed upon or against and/or
exhaust any security or remedy before proceeding to enforce this
Guaranty. Each Guarantor expressly waives any right to require Vicis
to marshal assets in favor of Issuer or any other Person or to proceed against
Issuer or any other guarantor of the Obligations or any collateral provided by
any Person, and agrees that Vicis may proceed against any obligor and/or the
collateral in such order as it shall determine in its sole and absolute
discretion. Vicis may file a separate action or actions against any
Guarantor, whether action is brought or prosecuted with respect to any security
or against any other Person, or whether any other Person is joined in any such
action or actions. Each Guarantor agrees that Vicis and Issuer may
deal with each other in connection with the Obligations or otherwise, or alter
any contracts or agreements now or hereafter existing between them, in any
manner whatsoever, all without in any way altering or affecting the security of
this Guaranty.
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(c) The
rights of Vicis hereunder shall be reinstated and revived, and the
enforceability of this Guaranty shall continue, with respect to any amount at
any time paid on account of the Obligations which thereafter shall be required
to be restored or returned by Vicis upon the bankruptcy, insolvency or
reorganization of any Person, all as though such amount had not been
paid. The rights of Vicis created or granted herein and the
enforceability of this Guaranty shall remain effective at all times to guarantee
the full amount of all the Obligations even though the Obligations, including
any part thereof or any other security or guaranty therefor, may be or hereafter
may become invalid or otherwise unenforceable as against Issuer or any other
guarantor of the Obligations and whether or not Issuer or any other guarantor of
the Obligations shall have any personal liability with respect
thereto.
(d) To the
extent permitted by applicable law, each Guarantor expressly waives any and all
defenses now or hereafter arising or asserted by reason of: (i) any
disability or other defense of Issuer or any other guarantor for the Obligations
with respect to the Obligations (other than full payment and performance of all
of the Obligations); (ii) the unenforceability or invalidity of any security for
or guaranty of the Obligations or the lack of perfection or continuing
perfection or failure of priority of any security for the Obligations;
(iii) the cessation for any cause whatsoever of the liability of Issuer or
any other guarantor of the Obligations (other than by reason of the full payment
and performance of all Obligations); (iv) any failure of Vicis to marshal assets
in favor of Issuer or any other Person; (v) any failure of Vicis to give notice
of sale or other disposition of collateral to Issuer or any other Person or any
defect in any notice that may be given in connection with any sale or
disposition of collateral; (vi) any failure of Vicis to comply with applicable
Laws in connection with the sale or other disposition of any collateral or other
security for any Obligation, including, without limitation, any failure of Vicis
to conduct a commercially reasonable sale or other disposition of any collateral
or other security for any Obligation; (vii) any act or omission of Vicis or
others that directly or indirectly results in or aids the discharge or release
of Issuer or any other guarantor of the Obligations, or of any security or
guaranty therefor by operation of Law or otherwise; (viii) any Law which
provides that the obligation of a surety or guarantor must neither be larger in
amount nor in other respects more burdensome than that of the principal or which
reduces a surety’s or guarantor’s obligation in proportion to the principal
obligation; (ix) any failure of Vicis to file or enforce a claim in any
bankruptcy or other proceeding with respect to any Person; (x) the election by
Vicis, in any bankruptcy proceeding of any Person, of the application or
non-application of Section 1111(b)(2) of the United States Bankruptcy Code; (xi)
any extension of credit or the grant of any lien under Xxxxxxx 000 xx xxx Xxxxxx
Xxxxxx Bankruptcy Code; (xii) any use of collateral under Section 363 of the
United States Bankruptcy Code; (xiii) any agreement or stipulation with respect
to the provision of adequate protection in any bankruptcy proceeding of any
Person; (xiv) the avoidance of any lien or security interest in favor of Vicis
for any reason; (xv) any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, liquidation or dissolution proceeding commenced by or
against any Person, including without limitation any discharge of, or bar or
stay against collecting, all or any of the Obligations (or any interest thereon)
in or as a result of any such proceeding; or (xvi) any action taken by Vicis
that is authorized by this Section or any other provision of any Transaction
Document. Until all of the Obligations have been paid in full, each
Guarantor expressly waives all presentments, demands for payment or performance,
notices of nonpayment or nonperformance, protests, notices of protest, notices
of dishonor and all other notices or demands of any kind or nature whatsoever
with respect to the Obligations, and all notices of acceptance of this Guaranty
or of the existence, creation or incurrence of new or additional
Obligations.
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(e) Each
Guarantor represents and warrants to Vicis that it has established adequate
means of obtaining from Issuer, on a continuing basis, financial and other
information pertaining to the business, operations and condition (financial and
otherwise) of Issuer and its assets and properties. Each Guarantor
hereby expressly waives and relinquishes any duty on the part of Vicis (should
any such duty exist) to disclose to such Guarantor any matter, fact or thing
related to the business, operations or condition (financial or otherwise) of
Issuer or its assets or properties, whether now known or hereafter known by
Vicis during the life of this Guaranty. With respect to any of the
Obligations, Vicis need not inquire into the powers of Issuer or agents acting
or purporting to act on its behalf, and all Obligations made or created in good
faith reliance upon the professed exercise of such powers shall be guaranteed
hereby.
(f) This is a
continuing guaranty and shall remain in full force and effect as to all of the
Obligations until all amounts owing by Issuer to Vicis on the Obligations shall
have been paid in full.
(g) Each
Guarantor expressly waives any claim for reimbursement, contribution, indemnity
or subrogation which such Guarantor may have against Issuer as a guarantor of
the Obligations and any other legal or equitable claim against Issuer arising
out of the payment of the Obligations by such Guarantor or from the proceeds of
any collateral for this Guaranty, until all amounts owing to Vicis under the
Obligations shall have been paid in full and all commitments to lend have been
terminated or expired. In furtherance, and not in limitation, of the
foregoing waiver, until all amounts owing to Vicis under the Obligations shall
have been paid in full, each Guarantor hereby agrees that no payment by such
Guarantor pursuant to this Guaranty shall constitute such Guarantor a creditor
of Issuer. Until all amounts owing to Vicis under the Obligations
shall have been paid in full, each Guarantor shall not seek any reimbursement
from Issuer in respect of payments made by such Guarantor in connection with
this Guaranty, or in respect of amounts realized by Vicis in connection with any
collateral for the Obligations, and each Guarantor expressly waives any right to
enforce any remedy that Vicis now has or hereafter may have against any other
Person and waives the benefit of, or any right to participate in, any collateral
now or hereafter held by Vicis. No claim which any Guarantor may have
against any other guarantor of any of the Obligations or against Issuer, to the
extent not waived pursuant to this Section, shall be enforced nor any payment
accepted until the Obligations are paid in full and all such payments are not
subject to any right of recovery.
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ARTICLE
3
REPRESENTATIONS
AND WARRANTIES OF GUARANTOR
Each
Guarantor hereby represents and warrants to Vicis as follows:
3.1 Authorization. Such
Guarantor is duly and validly organized and existing under the laws of the state
of its organization, has the corporate power to own its owned assets and
properties and to carry on its business, and is duly licensed or qualified to do
business in all jurisdictions in which failure to do so would have a material
adverse effect on its business or financial condition. The making,
execution, delivery and performance of this Guaranty, and compliance with its
terms, have been duly authorized by all necessary corporate action of such
Guarantor.
3.2 Enforceability. This
Guaranty is the legal, valid and binding obligation of such Guarantor,
enforceable against such Guarantor in accordance with its terms.
3.3 Absence of Conflicting
Obligations. The making, execution, delivery and performance
of this Guaranty, and compliance with its terms, do not violate any existing
provision of Law; the organizational or charter documents of such Guarantor; or
any agreement or instrument to which such Guarantor is a party or by which it or
any of its assets is bound.
3.4 Consideration for
Guaranty. Such Guarantor acknowledges and agrees with Vicis
that but for the execution and delivery of this Guaranty by such Guarantor,
Vicis would not have acquired the Acquired Notes. Such Guarantor
acknowledges and agrees that the proceeds of the sale of the Acquired Notes will
result in significant benefit to such Guarantor who is a wholly owned subsidiary
of Issuer and will benefit from the use of such proceeds.
ARTICLE
4
COVENANTS
OF THE GUARANTOR
4.1 Actions by
Guarantor. Each Guarantor shall not take or permit any act, or
omit to take any act, that would: (a) cause Issuer to breach any of
the Obligations; (b) impair the ability of Issuer to perform any of the
Obligations; or (c) cause an Event of Default under the Purchase
Agreement.
4.2 Reporting
Requirements. Each Guarantor shall furnish, or cause to be
furnished, to Vicis such information respecting the business, assets and
financial condition of such Guarantor as Vicis may reasonably
request.
ARTICLE
5
MISCELLANEOUS
5.1 Expenses and Attorneys’
Fees. Each Guarantor shall pay all reasonable fees and
expenses incurred by Vicis, including the reasonable fees of counsel, in
connection with the protection or enforcement of its rights under this Guaranty,
including without limitation the protection and enforcement of such rights in
any bankruptcy, reorganization or insolvency proceeding involving Issuer or such
Guarantor, both before and after judgment.
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5.2 Revocation. This
is a continuing guaranty and shall remain in full force and effect as to a
Guarantor until Vicis receives written notice of revocation signed by such
Guarantor. Upon revocation by written notice, this Guaranty shall
continue in full force and effect as to all Obligations contracted for or
incurred before revocation, and as to them Vicis shall have the rights provided
by this Guaranty as if no revocation had occurred. Any renewal,
extension, or increase in the interest rate(s) of any such Obligation, whether
made before or after revocation, shall constitute an Obligation contracted for
or incurred before revocation. Obligations contracted for or incurred
before revocation shall also include credit extended after revocation pursuant
to commitments made before revocation.
5.3 Assignability;
Successors. Each Guarantor’s rights and liabilities under this
Guaranty are not assignable or delegable, in whole or in part, without the prior
written consent of Vicis. The provisions of this Guaranty shall be
binding upon each Guarantor, its successors and permitted assigns and shall
inure to the benefit of Vicis, its successors and assigns.
5.4 Survival. All
agreements, representations and warranties made herein or in any document
delivered pursuant to this Guaranty shall survive the execution and delivery of
this Guaranty and the delivery of any such document.
5.5 Governing
Law. This Guaranty and the rights of the parties hereunder
shall be governed in all respects by the laws of the State of New York wherein
the terms of this Guaranty were negotiated, without regard to the conflicts of
laws thereof.
5.6 Execution;
Headings. This Guaranty may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission, such signature shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such facsimile
signature page were an original thereof. The article and section
headings in this Guaranty are inserted for convenience of reference only and
shall not constitute a part hereof.
5.7 Notices. All
notices, requests and demands to or upon Vicis or Guarantor (to be delivered
care of Issuer) shall be delivered in the manner set forth in Section 10.6 of
the Purchase Agreement.
5.8 Amendment. No
amendment of this Guaranty shall be effective unless in writing and signed by
each Guarantor and Vicis.
5.9 Severability. Any
provision of this Guaranty which 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 of this Guaranty in such jurisdiction or affecting the validity or
enforceability of any provision in any other jurisdiction.
5.10 Taxes. If
any transfer or documentary taxes, assessments or charges levied by any
governmental authority shall be payable by reason of the execution, delivery or
recording of this Guaranty, each Guarantor shall pay all such taxes, assessments
and charges, including interest and penalties, and hereby indemnifies Vicis
against any liability therefor.
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5.11 WAIVER OF RIGHT TO JURY
TRIAL. EACH GUARANTOR ACKNOWLEDGES AND AGREES THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER THIS GUARANTY WOULD BE BASED UPON DIFFICULT
AND COMPLEX ISSUES AND, THEREFORE, EACH GUARANTOR AGREES THAT ANY LAWSUIT
ARISING OUT OF ANY SUCH CONTROVERSY SHALL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
5.12 SUBMISSION TO JURISDICTION;
SERVICE OF PROCESS. AS A MATERIAL INDUCEMENT TO VICIS TO ENTER
INTO THIS TRANSACTION:
EACH
GUARANTOR AGREES THAT ALL ACTIONS OR PROCEEDINGS IN ANY MANNER RELATING TO OR
ARISING OUT OF THIS GUARANTY OR THE OTHER DOCUMENTS EXECUTED IN CONNECTION
HEREWITH MAY BE BROUGHT ONLY IN COURTS OF THE CITY AND STATE OF NEW YORK OR THE
FEDERAL COURTS LOCATED IN THE CITY AND STATE OF NEW YORK AND GUARANTOR CONSENTS
TO THE JURISDICTION OF SUCH COURTS. EACH GUARANTOR WAIVES ANY
OBJECTION IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH COURT AND ANY
RIGHT IT MAY HAVE NOW OR HEREAFTER HAVE TO CLAIM THAT ANY SUCH ACTION OR
PROCEEDING IS IN AN INCONVENIENT COURT; AND
Guarantor
consents to the service of process in any such action or proceeding by certified
mail sent to the address specified in Section 5.7. Nothing contained herein
shall affect the right of Vicis to serve process in any other manner permitted
by law or to commence an action or proceeding in any other
jurisdiction.
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IN
WITNESS WHEREOF the undersigned have executed this Guaranty as of the day and
year first above written.
|
AMACORE
DIRECT MARKETING, INC.
By:
_____________________________
Name:
Title:
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US
HEALTH BENEFITS GROUP, INC.
By:
_____________________________
Name:
Title:
|
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LIFEGUARD
BENEFIT SERVICES, INC.
By:
_____________________________
Name:
Title:
|
US
HEALTHCARE PLANS, INC.
By:
_____________________________
Name:
Title:
|
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JRM
BENEFITS CONSULTANTS, LLC
By:
_____________________________
Name:
Title:
|
ON
THE PHONE, INC.
By:
_____________________________
Name:
Title:
|
Signature
Page to Guaranty
ACCEPTANCE BY
VICIS
This
Guaranty Agreement is accepted by Vicis Capital Master Fund.
|
VICIS CAPITAL MASTER FUND
By: Vicis Capital
LLC
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By:
|
_____________________________ | |
| Name | |||
| Title | |||
Acceptance
Page to Guaranty
