EXHIBIT 10.26
GUARANTY AGREEMENT
Dated as of July 23, 1997
This GUARANTY AGREEMENT ("this Guaranty") is made as of the date set
forth above by XXXX XXXXXX, an individual currently residing at 000 Xxxxx
Xxxxxxxxx, Xxxxxx Xxxxx, XX 00000 (the "Guarantor") in favor of the banks party
to the Credit Agreement referred to below (the "Banks") and BANK LEUMI LE-ISRAEL
B.M., as agent for the Banks under said Credit Agreement (the "Agent").
BACKGROUND
A. New M-Tech Corporation, a Florida corporation, ("New M-Tech") and
Newtech Hong Kong Ltd., a Hong Kong limited liability company ("Newtech Hong
Kong", and collectively with New M-Tech, the "Borrowers", each a "Borrower"),
the Banks and the Agent are parties to a Credit Agreement dated as of July 23,
1997 (as modified and supplemented and in effect from time to time, the "Credit
Agreement", the capitalized terms used but not otherwise defined herein being
used herein as therein defined), providing, subject to the terms and conditions
thereof, for Extensions of Credit.
B. The Guarantor owns 50% of the voting stock of New M-Tech, and New
M-Tech owns all the voting stock of Newtech Hong Kong. Accordingly, the
Guarantor will benefit substantially from Extensions of Credit to either or both
of the Borrowers.
C. It is a condition precedent to the Banks' making Extensions of
Credit to the Borrowers that the Guarantor shall have executed and delivered
this Guaranty.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration (the receipt and adequacy of which are hereby
acknowledged) and in order to induce the Banks to make Extensions of Credit to
the Borrowers, the Guarantor agrees as follows:
/section/1. GUARANTY.
(a) The Guarantor hereby absolutely and unconditionally
guarantees the punctual payment when due, whether at stated maturity,
by acceleration or otherwise, of the Obligations and all other
obligations and liabilities of either or both of the Borrowers to each
and any Bank and/or the Agent now or hereafter existing under,
evidenced by or in any way relating to the Credit Agreement, any Note
and/or any other Loan Document, whether for principal, interest,
overdrafts, fees, commissions, expenses or otherwise (the Obligations
and such other obligations and liabilities referred to in this
/section/1 being collectively, the "Obligations"). This is a guaranty
of payment and not of collection and it shall not be affected in any
way by the absence of any action to obtain payment from the Borrowers.
In addition, the Guarantor agrees to pay any and all expenses
(including counsel fees and expenses at all
levels) incurred by each Bank and the Agent in enforcing any rights
under this Guaranty (the "Collection Costs").
(b) The liability of Guarantor under this Guaranty shall not
exceed the following sum (the "Maximum Amount"): (i) $3,000,000, plus
(ii) interest accrued under the Credit Agreement or the Notes with
respect to the principal amount of $3,000,000, plus (iii) the
Collection Costs. The Maximum Amount shall not be affected by the total
amount of credit extended at any time by the Banks or the Agent to the
Borrowers, by the amount recovered from or the maximum liability set
forth in any other guaranties of the Obligations or by the amount
realized from the Collateral or any collateral for any such other
guaranties (by way of illustration, if $3,000,000 were paid by or
recovered from another guarantor of the Obligations, the Guarantor
would still be liable for any remaining Obligations up to the Maximum
Amount).
/section/2. GUARANTY ABSOLUTE. The Guarantor guarantees that the
Obligations will be paid strictly in accordance with the terms of the documents
governing them, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the each
Bank and the Agent with respect thereto. The liability of the Guarantor under
this Guaranty shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any payment
provisions of any agreements or instruments relating to or securing any
of the Obligations or any instrument by which the Guarantor has granted
the Agent or any Bank or Banks a security interest or lien as security
here for or for any of the Obligations (said agreements and instruments
being collectively the "Loan Documents");
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to departure from any of the Loan
Documents;
(c) any exchange, release, or nonperfection of a security
interest in, any collateral for any of the Obligations, any limitation
as to the amount of the Obligations secured by any of the Loan
Documents, any invalidity of, release, amendment or waiver of or
consent to departure from, any other guaranty for all or any of the
Obligations or any failure to obtain any guaranty contemplated by the
Loan Documents or any related commitment or proposal letter;
(d) the voluntary or involuntary bankruptcy of either
Borrower, or any assignment for the benefit of creditors,
reorganization, receivership, liquidation or other similar proceedings
affecting either Borrower or any of its assets;
(e) any present or future action of any governmental authority
amending, varying, reducing or otherwise affecting, or purporting to
amend, vary, reduce or otherwise affect, any of the Obligations, any of
the Loan Documents or this Guaranty;
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(f) any other event or circumstance which might otherwise
constitute a defense available to, or a discharge of, either Borrower
or a guarantor.
Nothing herein to the contrary withstanding, this Guaranty shall continue to be
effective or be reinstated, as the case may be, if at any time any payment of
any of the Obligations is rescinded or must otherwise be returned by the Agent
or any Bank upon the insolvency, bankruptcy or reorganization of either Borrower
or otherwise, all as though such payments had not been made.
/section/3. WAIVER. The Guarantor hereby unconditionally waives:
(a) promptness, diligence, notice of acceptance and all other
notices with respect to any of the Obligations, this Guaranty or any
disposition of collateral;
(b) any requirement that the Agent or any Bank protect,
secure, perfect or insure any security interest or lien on any property
subject thereto or exhaust any right or take any action against either
Borrower or any other person or entity or any collateral;
(c) any defense based on any event or circumstances described
in /section/2; and
(d) any duty of the Agent or any Bank to advise the Guarantor
of any information known to the Agent or such Bank regarding the
financial condition of either Borrower or any other circumstance
affecting either Borrower's ability to perform its obligations to the
Banks, it being agreed that the Guarantor assumes responsibility for
being and keeping informed regarding such condition or any such
circumstance.
/section/4. SUBROGATION. The Guarantor shall not exercise any rights
which he may acquire by way of subrogation under this Guaranty, by any payment
made hereunder or otherwise, until all the Obligations shall have been paid in
full. If any amount shall be paid to the Guarantor on account of such
subrogation rights at any time when all the Obligations shall not have been paid
in full, such amount shall be held in trust for the benefit of the Agent and the
Banks and shall forthwith be paid to the Agent for the account of the Banks to
be credited and applied upon the Obligations, whether matured or unmatured.
/section/5. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants to the Agent and the Banks as follows:
(a) The execution, delivery and performance by the Guarantor
of this Guaranty do not contravene law or any contractual restriction
binding on or affecting the Guarantor.
(b) No authorization or approval or other action by, and no
notice to or filing with, any person or any governmental authority or
regulatory body, is required for the due execution, delivery and
performance by the Guarantor of this Guaranty.
(c) The Guarantor has received adequate consideration and
equivalent value for executing and delivering this Guaranty and will
not be rendered insolvent thereby. This
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Guaranty is the legal, valid and binding obligation of the Guarantor
enforceable against him in accordance with its terms.
(d) There is no pending or threatened action or proceeding
affecting the Guarantor before any court, governmental agency or
arbitrator, which may materially adversely affect the Guarantor's
financial condition.
/section/6. ADDITIONAL COVENANTS. As long as this Guaranty is in
effect, the Guarantor shall, unless the Agent and the Required Banks shall
otherwise consent in writing:
(a) Comply in all material respects with all applicable laws,
rules, regulations and orders (such compliance to include, without
limitation, paying before the same become delinquent all taxes,
assessments and governmental charges) imposed upon him or upon his
property non-compliance with which would have a material adverse effect
on the financial condition or business of the Guarantor).
(b) Furnish to each Bank the following:
(i) as soon as available and in any event within 90
days after the end of each calendar year, a balance sheet of
the Guarantor as of the end of such year, a statement of
income and retained earnings of the Guarantor for such year
and a projection of the Guarantor's income for the following
year, each prepared in a form acceptable to the Agent and
certified by the Guarantor;
(ii) as soon as available and in any event within 90
days after the end of each calendar year, a copy of the
Guarantor's federal income tax return;
(iii) as soon as possible and in any event within 10
days of the Guarantor's discovery thereof, notice of any event
or circumstance which has or may have a material adverse
effect upon the financial condition of the Guarantor;
(iv) as soon as possible and in any event within 10
days after the commencement thereof or any adverse
determination therein, notice of all actions, suits and
proceedings before any court or governmental department,
commission, board, bureau, agency or instrumentality
materially affecting the Guarantor;
(v) promptly, such other information respecting the
condition or operations, financial or otherwise, of the
Guarantor as the Agent may from time to time reasonably
request.
(c) Except for this Guaranty, not create or incur any debt
(except to the Agent and the Banks) or assume, guarantee or endorse any
indebtedness the result of which would be to significantly impair the
Guarantor's ability to perform his obligations hereunder.
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(d) Not sell, transfer or otherwise dispose of any of his
assets or properties and not create or suffer to exist any lien,
security interest or other charge or encumbrance, or any other type of
preferential arrangement, upon or with respect to any of his assets or
properties, if the result would be to decrease significantly the
Guarantor's net worth or to impair the ability of a judgment creditor
of the Guarantor to attach or garnish such assets or properties.
/section/7. AMENDMENTS, ETC. No amendment or waiver of any provision of
this Guaranty nor consent to any departure by the Guarantor therefrom shall in
any event be effective unless it shall be in writing and signed by the Agent and
the Required Banks, and then any such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.
/section/8. NOTICES. All notices, requests, demands, directions or
other communications provided for hereunder shall be in writing and mailed
(certified, return receipt requested, if practicable), telegraphed or telexed to
the applicable party at the addresses indicated below:
If to the Agent:
Bank Leumi Le-Israel B.M., Miami Agency
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxx, XX 00000
If to the Guarantor:
the address set forth at the
head of this Guaranty
(or, if no address is set forth there, whatever address of the Guarantor appears
on the Agent's books.) Notices mailed to the Guarantor shall be deemed given
three days after being mailed or, if telecopied or telexed, when received, and
notices mailed to the Agent shall be deemed given when actually received by it.
/section/9. NO WAIVER; REMEDIES. No failure on the part of the Agent or
any Bank to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
/section/10. RIGHT OF SETOFF. Upon the occurrence of any Event of
Default (as defined in any note evidencing any of the Obligations), any Bank is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by such Bank to or for the credit or the account of the Guarantor
against any and all of the obligations of the Guarantor now or hereafter
existing under this Guaranty, irrespective of whether or not such Bank shall
have made any demand under this Guaranty and although such obligations may be
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contingent and unmatured. The rights of any Bank under this /section/10 are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) which such Bank may have.
/section/11. CONTINUING GUARANTY. This Guaranty is a continuing
guaranty and shall (i) remain in full force and effect until payment in full of
the Obligations and written notice is given by the Agent to the Guarantor that
this Guaranty has been terminated (and thereafter with respect to any indemnity
obligations of either Borrower that survive cancellation or termination of the
Loan Documents and thereafter as long as any payment of or recovery against or
with respect to the Obligations might be rescinded or otherwise required to be
returned by the Agent or any Bank for any reason, including the bankruptcy,
insolvency or reorganization of either Borrower ), (ii) be binding upon the
Guarantor and his heirs, personal representatives, successors and assigns (even
as to Obligations incurred after his death or incompetency), and (iii) inure to
the benefit of and be enforceable by the Agent and each Bank and its successors,
transferees and assigns. Without limiting the generality of the foregoing clause
(iii), if any Bank assigns or otherwise transfers any Note held by it to any
other person or entity, such other person or entity shall thereupon become
vested with all the rights in respect thereof granted to such Bank herein or
otherwise.
/section/12. DEFAULT. Upon the occurrence of an Event of Default (as
defined in the Credit Agreement or any note evidencing any of the Obligations),
all the Guarantor's obligations hereunder shall immediately be due and payable
in full without notice.
/section/13. GOVERNING LAW. This Guaranty shall be governed by, and
construed in accordance with, the law of the State of Florida without regard to
any conflicts-of-law principle or rule that would give effect to the law of any
other jurisdiction.
/section/14. TERMINOLOGY. As used herein, "hereof," "hereunder,"
"hereby" and "herein" refer to this Guaranty as a whole and not merely the
paragraph in which they appear. As used herein, masculine pronouns shall be read
as feminine or neuter pronouns if appropriate.
/section/15. SEVERABILITY. If any provision of this Guaranty shall be
held invalid under any applicable law, such invalidity shall not affect any
other provision of this Guaranty that can be given effect without the invalid
provision, and, to that end, the provisions hereof are severable.
/section/16. SUBORDINATION. The Guarantor hereby subordinates payment
of all debts now or hereafter owing by either Borrower to the Guarantor to any
and all Obligations. The Guarantor shall ensure that every note evidencing any
part of the subordinated debt and every ledger page relating thereto bears a
legend which indicates this subordination. The Guarantor shall not request or
accept payment of all or any security for any part of the subordinated debt,
and, if all of any part of it should be paid to the Guarantor, through error or
otherwise, the Guarantor shall immediately forward such payment to the Agent in
the form received, properly endorsed to the order of the Agent, to be applied
against the Obligations.
/section/17. MANNER AND ALLOCATION OF PAYMENTS. All payments hereunder
shall be made to the Agent at the Agent's Office. Each payment received by the
Agent hereunder with respect to the Obligations shall be made to the Agent for
the benefit of the Banks and shall be applied and
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distributed by the Agent in the same manner as payments received from the
Borrowers under the Credit Agreement.
/section/18. SUBMISSION TO JURISDICTION. The Guarantor hereby
irrevocably (a) submits, in any legal proceeding relating to this Guaranty, to
the non-exclusive IN PERSONAM jurisdiction of any state or United States court
of competent jurisdiction sitting in the State of Florida and agrees to suit
being brought in any such court; (b) waives any objection that he may now or
hereafter have to the venue of such proceeding in any such court located in Dade
County, Florida or that such proceeding was brought in an inconvenient court;
(c) agrees that service of process in any such proceeding may be made by
certified mail, return receipt requested, to the address set forth at the head
of this Agreement; and (d) agrees that nothing herein shall affect the right of
the Bank to effect service of process in any manner permitted by law and that
the Bank shall have the right to bring any legal proceedings (including a
proceeding for enforcement of a judgment entered by any of the aforementioned
courts) against the Guarantor in any other court or jurisdiction in accordance
with applicable law.
/section/19. WAIVER OF JURY TRIAL. THE GUARANTOR AND (BY ACCEPTANCE
HEREOF) THE AGENT AND THE BANKS EACH WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING HEREUNDER OR RELATING
HERETO.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this
Guaranty as of the date first above written.
/S/ XXXX XXXXXX
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XXXX XXXXXX
STATE OF FLORIDA )
) SS:
COUNTY OF DADE )
The foregoing instrument was acknowledged before me this __ day of
July, 1997 by Xxxx Xxxxxx, who is personally known to me or who has produced
______________________________________________ as identification.
__________________________________________
Notary Public, State of Florida
Print Name:_______________________________
My commission expires: (SEAL)
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CONFIRMATION OF GUARANTY AGREEMENT
DATED AS OF SEPTEMBER 8, 1997
This CONFIRMATION OF GUARANTY AGREEMENT ("this Confirmation") is made
by and among XXXX XXXXXX (the "Guarantor"), BANK LEUMI LE-ISRAEL B.M., COMERICA
BANK and NATIONAL BANK OF CANADA (the "Banks") and BANK LEUMI LE-ISRAEL B.M., as
Agent (the "Agent") and relates to that certain Guaranty Agreement, dated as of
July 23, 1997, made by the Guarantor in favor of the Banks and the Agent (the
"Guaranty," the capitalized terms used but not otherwise defined herein being
used herein as therein defined).
For good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Guarantor hereby agrees as follows:
1. The Guarantor consents to the Amendment to Credit Agreement, dated in
September, 1997, between the Borrowers, the Banks and the Agent and to the
issuance by the Borrowers of Revolving Notes in the principal amounts of
$9,375,000, $7,500,000 and $3,125,000 in favor of Bank Leumi le-Israel B.M.,
Comerica Bank and National Bank of Canada, respectively, and acknowledges and
agrees that the Obligations as referred to and defined in the Guaranty include
all obligations and liabilities arising under the Credit Agreement, as amended
by the aforesaid Amendment to Credit Agreement, and/or any or all of the
aforesaid Revolving Notes.
2. As amended hereby, the Guaranty shall remain in full force and effect and is
hereby confirmed. The Guarantor acknowledges that he has no defenses,
counterclaims or rights of offset with respect to his obligations under the
Guaranty and waives any that he may have.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this
Confirmation as of the date first above written.
/s/ Xxxx Xxxxxx
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XXXX XXXXXX
CONFIRMATION OF GUARANTY AGREEMENT
DATED AS OF NOVEMBER 1, 1997
This AMENDMENT TO GUARANTY AGREEMENT ("this Amendment") is made by XXXX
XXXXXX (the "Guarantor") in favor of BANK LEUMI LE-ISRAEL B.M., COMERICA BANK
and NATIONAL BANK OF CANADA (the "Banks") and BANK LEUMI LE-ISRAEL B.M., as
Agent (the "Agent") and relates to that certain Guaranty Agreement, dated as of
July 23, 1997, made by the Guarantor in favor of the Banks and the Agent (the
"Guaranty," the capitalized terms used but not otherwise defined herein being
used herein as therein defined).
For good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Guarantor hereby confirms and agrees as follows:
1. The Guarantor consents to the Amendment to Credit Agreement, dated in
November, 1997, between the Borrowers, the Banks and the Agent and to the
issuance by the Borrowers of Revolving Notes in the principal amounts of
$15,000,000, $13,000,000 and $9,000,000 in favor of Bank Leumi le-Israel B.M.,
Comerica Bank and National Bank of Canada, respectively, and acknowledges and
agrees that the Obligations as referred to and defined in the Guaranty include
without limitation all obligations and liabilities arising under the Credit
Agreement, as amended by the aforesaid Amendment to Credit Agreement, and/or any
or all of the aforesaid Revolving Notes.
2. The Guaranty shall remain in full force and effect and is hereby confirmed.
The Guarantor acknowledges that he has no defenses, counterclaims or rights of
offset with respect to his obligations under the Guaranty and waives any that he
may have.
3. THE GUARANTOR HEREBY WAIVES ANY RIGHT HE MAY HAVE TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING HEREUNDER OR RELATING HERETO.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this
Amendment as of the date first above written.
/s/ Xxxx Xxxxxx
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XXXX XXXXXX
CONFIRMATION OF GUARANTY AGREEMENT
DATED AS OF MARCH 19, 1998
This CONFIRMATION OF GUARANTY AGREEMENT ("this Confirmation") is made
by and among XXXX XXXXXX (the "Guarantor"), BANK LEUMI LE-ISRAEL B.M., COMERICA
BANK and NATIONAL BANK OF CANADA (the "Banks") and BANK LEUMI LE-ISRAEL B.M., as
Agent (the "Agent") and relates to that certain Guaranty Agreement, dated as of
July 23, 1997, made by the Guarantor in favor of the Banks and the Agent (as
heretofore amended, the "Guaranty," the capitalized terms used but not otherwise
defined herein being used herein as therein defined).
For good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the Guarantor hereby agrees as follows:
1. The Guarantor consents to the Amendment to Credit Agreement, dated in March,
1998, between the Borrowers (as redefined by said Amendment to Credit
Agreement), the Banks and the Agent and to the issuance by the Borrowers (as
redefined by said Amendment to Credit Agreement) of Revolving Notes in the
principal amounts of $15,000,000, $13,000,000 and $9,000,000 in favor of Bank
Leumi le-Israel B.M., Comerica Bank and National Bank of Canada, respectively,
and acknowledges and agrees that the Obligations as referred to and defined in
the Guaranty include all obligations and liabilities of any and all of the
Borrowers (as redefined by said Amendment to Credit Agreement) arising under the
Credit Agreement, as amended by the aforesaid Amendment to Credit Agreement and
any previous amendments thereto, and/or any or all of the aforesaid Revolving
Notes.
2. As amended hereby, the Guaranty shall remain in full force and effect and is
hereby confirmed. The Guarantor acknowledges that he has no defenses,
counterclaims or rights of offset with respect to his obligations under the
Guaranty and waives any that he may have.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this
Confirmation as of the date first above written.
/s/ Xxxx Xxxxxx
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