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EXHIBIT 2.5
GUARANTY
The undersigned, for value received, unconditionally and absolutely
guarantees to XXXXXXX FINANCIAL SERVICES CORPORATION ("Xxxxxxx"), a Michigan
corporation of 000 Xxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000 and
to Xxxxxxx'x successors and assigns, payment when due, whether by stated
maturity, demand, acceleration or otherwise, of all existing and future
Indebtedness, as defined below, to Xxxxxxx of DMR FINANCIAL SERVICES, INC., a
Michigan corporation whose address is 00000 Xxxxxxxx Xxxxx Xxxx, Xxxxxxxxxx
Xxxxx, XX 00000 and also of any successor in interest, including without limit
any debtor-in-possession or trustee in bankruptcy which succeeds to the
interests of this party or person (jointly and severally the "Borrower").
"Indebtedness", as used herein, shall mean (a) any and all direct
indebtedness of the Borrower to Xxxxxxx under a certain Promissory Note of even
date in the original principal amount of $1,500,000; (b) any and all
indebtedness, obligations or liabilities for which the Borrower would otherwise
be liable to Xxxxxxx thereunder were it not for the invalidity, irregularity or
unenforceability of them by reason of any bankruptcy,insolvency or other law or
order of any kind, or for any other reason, including without limit liability
for interest and attorney fees on, or in connection with, any of the
Indebtedness from and after the filing by or against the Borrower of a
Bankruptcy petition; (c) any and all amendments, modifications, renewals and/or
extensions of any of the above, including without limit amendments,
modifications, renewals and/or extensions which are evidenced by new or
additional instruments,documents or agreements; and (d) all costs of collecting
Indebtedness, including without limit reasonable attorney fees.
The undersigned waives notice of acceptance of this Guaranty and
presentment, demand, protest, notice of protest, dishonor, notice of dishonor,
notice of default, notice of intent to accelerate or demand payment of any
Indebtedness, and diligence in collecting any indebtedness, and agrees that
Xxxxxxx may modify the terms of any Indebtedness, compromise, extend, increase,
accelerate, renew or forbear to enforce payment of any or all Indebtedness, all
without notice to the undersigned and without affecting in any manner the
unconditional obligation of the undersigned under this Guaranty. The undersigned
further waives any and all other notices to which the undersigned might
otherwise be entitled. The undersigned acknowledges and agrees that the
liabilities created by this Guaranty are direct and are not conditioned upon
pursuit by Xxxxxxx of any remedy Xxxxxxx may have against the Borrower or any
other person or any security. No invalidity, irregularity or unenforceability of
any part or all of the Indebtedness or any documents evidencing the same, by
reason of any bankruptcy, insolvency or other law or order of any kind or for
any other reason, and no defense or setoff available at any time to the
Borrower, shall impair, affect or be a defense or setoff to the obligations of
the undersigned under this Guaranty.
The undersigned delivers this Guaranty based solely on the
undersigned's independent investigation of the financial condition of the
Borrower and is not relying on any information furnished by Xxxxxxx. The
undersigned assumes full responsibility for obtaining any further information
concerning the Borrower's financial condition, the status of the Indebtedness or
any other matter which the undersigned may deem necessary or appropriate from
time to time.
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The undersigned waives any duty on the part of Xxxxxxx, and agrees that
it is not relying upon nor expecting Xxxxxxx to disclose to the undersigned any
fact now or later known by Xxxxxxx, whether relating to the operations or
condition of the Borrower, the existence, liabilities or financial condition of
any co-guarantor of the Indebtedness, the occurrence of any default with respect
to the Indebtedness, or otherwise, notwithstanding any effect these facts may
have upon the undersigned's risk under this Guaranty or the undersigned's rights
against the Borrower. The undersigned knowingly accepts the full range of risk
encompassed in this Guaranty.
The undersigned represents and warrants that: (a) Xxxxxxx has made no
representation to the undersigned as to the creditworthiness of the Borrower;
and (b) the undersigned has established adequate means of obtaining from the
Borrower on a continuing basis financial and other information pertaining to the
Borrower's financial condition. The undersigned agrees to keep adequately
informed of an facts, events or circumstances which might in any way affect the
risks of the undersigned under this Guaranty.
The undersigned grants to Xxxxxxx the right of setoff as to any and all
property of the undersigned now or later in the possession of Xxxxxxx. The
undersigned subordinates any claim of any nature that the undersigned now or
later has against the Borrower to and in favor of all Indebtedness and agrees
not to accept payment or satisfaction of any claim that the undersigned now or
later may have against the Borrower without the prior written consent of
Xxxxxxx. Should any payment, distribution, security, or proceeds, be received by
the undersigned upon or with respect to any claim that the undersigned now or
may later have against the Borrower, the undersigned shall immediately deliver
the same to Xxxxxxx in the form received (except for endorsement or assignment
by the undersigned where required by Xxxxxxx) for application on the
Indebtedness, whether matured or unmatured, and until delivered the same shall
be held in trust by the undersigned as the property of Xxxxxxx.
The undersigned agrees that no security now or later held by Xxxxxxx
for the payment of any Indebtedness, whether from the Borrower, any guarantor,
or otherwise, and whether in the nature of a security interest, pledge, lien,
assignment, setoff, suretyship, guaranty, indemnity, insurance or otherwise,
shall affect in any manner the unconditional obligation of the undersigned under
this Guaranty, and Xxxxxxx, in its sole discretion, without notice to the
undersigned, may release, exchange, enforce and otherwise deal with any security
without affecting in any manner the unconditional obligation of the undersigned
under this Guaranty. The undersigned acknowledges and agrees that Xxxxxxx has no
obligation to acquire or perfect any lien on or security interest in any assets,
whether realty or personalty, to secure payment of the Indebtedness, and the
undersigned is not relying upon any assets in which Xxxxxxx has or may have a
lien or security interest for payment of the Indebtedness.
The undersigned acknowledges that the effectiveness of this Guaranty is
not conditioned on any or all of the indebtedness being guaranteed by anyone
else.
Until the Indebtedness is irrevocably paid in full, the undersigned
waives any and all rights to be subrogated to the position of Xxxxxxx or to have
the benefit of any lien, security interest or other guaranty now or later held
by Xxxxxxx for the Indebtedness or to enforce any remedy which Xxxxxxx now or
later has against the Borrower or any other person. Until the Indebtedness is
irrevocably paid in full, the undersigned shall have no right of reimbursement,
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indemnity, contribution or other right of recourse to or with respect to the
Borrower or any other person. The undersigned agrees to indemnify and hold
harmless Xxxxxxx from and against any and all claims, actions, damages, costs
and expenses, including without limit reasonable attorneys' fees, incurred by
Xxxxxxx in connection with the undersigned's exercise of any right of
subrogation, contribution, indemnification or recourse with respect to this
Guaranty. Xxxxxxx has no duty to enforce or protect any rights which the
undersigned may have against the Borrower or any other person and the
undersigned assumes full responsibility for enforcing and protecting these
rights.
Notwithstanding any provision of the preceding paragraph or anything
else in this Guaranty to the contrary, if any of the undersigned is or becomes
an "insider" or "affiliate" (as defined in Section 101 of the Federal Bankruptcy
Code, as it may be amended) with respect to the Borrower, then that undersigned
irrevocably and absolutely waives any and all rights of subrogation,
contribution, indemnification, recourse, reimbursement and any similar rights
against the Borrower (or any other guarantor) with respect to this Guaranty,
whether such rights arise under an express or implied contract or by operation
of law. It is the intention of the parties that the undersigned shall not be (or
be deemed to be) a "creditor" (as defined in Section 101 of the Federal
Bankruptcy Code, as it may be amended) of the Borrower (or any other guarantor)
by reason of the existence of this Guaranty in the event that the Borrower
becomes a debtor in any proceeding under the Federal Bankruptcy Code. This
waiver is given to induce Xxxxxxx to enter into certain written contracts with
the Borrower included in the Indebtedness. The undersigned warrants and agrees
that none of Xxxxxxx'x rights, remedies or interests shall be directly or
indirectly impaired because of any of the undersigned's status as an "insider"
or "affiliate" of the Borrower, and the undersigned shall take any action, and
shall execute any document, which Xxxxxxx may request in order to effectuate
this warranty to Xxxxxxx.
If any Indebtedness is guaranteed by two or more guarantors, the
obligation of the undersigned shall be several and also joint, each with all and
also each with any one or more of the others, and may be enforced at the option
of Xxxxxxx against each severally, any two or more jointly, or some severally
and some jointly. Xxxxxxx, in its sole discretion, may release any one or more
of the guarantors for any consideration which it deems adequate, and may fail or
elect not to prove a claim against the estate of any bankrupt, insolvency,
incompetent or deceased guarantor; and after that, without notice to any other
guarantor, Xxxxxxx may extend or renew any or all Indebtedness and may permit
the Borrower to incur additional Indebtedness, without affecting in any manner
the unconditional obligation of the remaining guarantors. This action by Xxxxxxx
shall not, however, be deemed to affect any right to contribution which may
exist among the guarantors.
Notwithstanding any prior termination, surrender or discharge of this
Guaranty (or of any lien, pledge or security interest securing this Guaranty) in
whole or in part, the effectiveness of this Guaranty, and of all liens, pledges
and security interests securing this Guaranty, shall automatically continue or
be reinstated, as the case may be, in the event that any payment received or
credit given by Xxxxxxx in respect of the Indebtedness is returned, disgorged or
rescinded as a preference, impermissible setoff, fraudulent conveyance,
diversion of trust funds, or otherwise under any applicable state or federal
law, including, without limitation, laws pertaining to bankruptcy or insolvency,
in which case this Guaranty, and all liens, pledges and security interests
securing this Guaranty, shall be enforceable against the undersigned as if the
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returned, disgorged or rescinded payment or credit had not been received or
given by Xxxxxxx, and whether or not Xxxxxxx relied upon this payment or credit
or changed its position as a consequence of it.
The undersigned waives any right to require Xxxxxxx to: (a) proceed
against any person, including without limit the Borrower; (b) proceed against or
exhaust any security held from the Borrower or any other person; (c) give notice
of the terms, time and place of any public or private sale of personal property
security held from the Borrower or any other person, or otherwise comply with
the provisions of Section 9-504 of the Michigan or other applicable Uniform
Commercial Code; (d) pursue any other remedy in Xxxxxxx'x power; or (e) make any
presentments or demands for performance, or give any notices of nonperformance,
protests, notices of protest, or notices of dishonor in connection with any
obligations or evidences of Indebtedness held by Xxxxxxx as security, in
connection with any other obligations or evidences of indebtedness which
constitute in whole or in part Indebtedness.
The undersigned authorizes Xxxxxxx, either before or after termination
of this Guaranty, without notice to or demand on the undersigned and without
affecting the undersigned's liability under this Guaranty, from time to time to:
(a) apply any security and direct the order or manner of sale of it, including
without limit, a non-judicial sale permitted by the terms of the controlling
security agreement, mortgage or deed of trust, as Xxxxxxx in its discretion may
determine; (b) release or substitute any one or more of the endorsers or any
other guarantors of the Indebtedness; and (c) apply payments received by Xxxxxxx
from the Borrower to any indebtedness of the Borrower to Xxxxxxx, in such order
as Xxxxxxx shall determine in its sole discretion, whether or not this
indebtedness is covered by this Guaranty, and the undersigned waives any
provision of law regarding application of payments which specifies otherwise.
Xxxxxxx may without notice assign this Guaranty in whole or in part. Upon
Xxxxxxx'x request, the undersigned agrees to provide to Xxxxxxx copies of the
undersigned's financial statements.
The undersigned waives any defense based upon or arising by reason of
(a) any disability or other defense of the Borrower or any other person; (b) the
cessation or limitation from any cause whatsoever, other than final and
irrevocable payment in full, of the Indebtedness; (c) any lack of authority of
any officer, director, partner, agent or any other person acting or purporting
to act on behalf of the Borrower which is a corporation, partnership or other
type of entity, or any defect in the formation of the Borrower; (d) the
application by the Borrower of the proceeds of any Indebtedness for purposes
other than the purposes represented by the Borrower to Xxxxxxx or intended or
understood by Xxxxxxx or the undersigned; (e) any act or omission by Xxxxxxx
which directly or indirectly results in or aids the discharge of the Borrower or
any Indebtedness by operation of law or otherwise; or (f) any modification of
the Indebtedness, in any form whatsoever including without limit any
modification made after effective termination, and including without limit the
renewal, extension, acceleration or other change in time for payment of the
Indebtedness, or other change in the terms of any Indebtedness, including
without limit increase or decrease of the interest rate. The undersigned waives
any defense the undersigned may have based upon any election of remedies by
Xxxxxxx which destroys the undersigned's subrogation rights or the undersigned's
right to proceed against the Borrower for reimbursement, including without limit
any loss of rights the undersigned may suffer by reason of any rights, powers or
remedies of the Borrower in connection with any anti-deficiency, valuation laws
or any other laws limiting,
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qualifying or discharging any Indebtedness.
The undersigned acknowledges that Xxxxxxx has the right to sell,
assign, transfer, negotiate, or grant participations in all or any part of the
Indebtedness and any related obligations, including without limit this Guaranty.
In connection with that right, Xxxxxxx may disclose any documents and
information which Xxxxxxx now or later acquire relating to the undersigned and
this Guaranty, whether furnished by the Borrower, the undersigned or otherwise.
The undersigned further agrees that Xxxxxxx may disclose these documents and
information to the Borrower.
The undersigned unconditionally and irrevocably waives each and every
defense and setoff of any nature which, under principles of guaranty or
otherwise, would operate to impair or diminish in any way the obligation of the
undersigned under this Guaranty, and acknowledges that each such waiver is by
this reference incorporated into each security agreement, collateral assignment,
pledge and/or other document from the undersigned now or later securing this
Guaranty and/or the Indebtedness, and acknowledges that as of the date of this
Guaranty no such defense or setoff exists. The undersigned acknowledges that the
effectiveness of this Guaranty is subject to no conditions of any kind.
The undersigned warrants and agrees that each of the waivers set forth
above are made with the undersigned's full knowledge of their significance and
consequences, and that under the circumstances, the waivers are reasonable and
not contrary to public policy or law. If any of these waivers are determined to
be contrary to any applicable law or public policy, these waivers shall be
effective only to the extent permitted by law.
This Guaranty constitutes the entire agreement of the undersigned and
Xxxxxxx with respect to the subject matter of this Guaranty. No waiver, consent,
modification or change of the terms of this Guaranty shall bind any of the
undersigned or Xxxxxxx unless in writing and signed by the waiving party or an
authorized officer of the waiving party, and then this waiver, consent,
modification or change shall be effective only in the specific instance and for
the specific purpose given. This Guaranty shall inure to the benefit of Xxxxxxx
and its successors and assigns. This Guaranty shall be binding on the
undersigned and the undersigned's successors and assigns including, without
limit, any debtor in possession or trustee in bankruptcy for any of the
undersigned. The undersigned has (have) knowingly and voluntarily entered into
this Guaranty in good faith for the purpose of inducing Xxxxxxx to extend credit
or make other financial accommodations to the Borrower, and the undersigned
acknowledges that the terms of this Guaranty are reasonable. If any provision of
this Guaranty is unenforceable in whole or in part for any reason, the remaining
provisions shall continue to be effective. THIS GUARANTY SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF MICHIGAN.
THE UNDERSIGNED AND XXXXXXX ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A
CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED. EACH PARTY, AFTER CONSULTING (OR
HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY
AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT WAIVES ANY RIGHT TO TRIAL BY JURY
IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN
ANY WAY RELATED TO, THIS
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GUARANTY OR THE INDEBTEDNESS.
IN WITNESS WHEREOF, the undersigned has (have) signed this Guaranty on June 30,
1999.
GUARANTOR:
DETROIT MORTGAGE AND REALTY
COMPANY
By: /s/ Xxxxxx X. Xxxxxxxxx
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Its: Chairman
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