Exhibit 99.3
GUARANTY
GUARANTY (the "Guaranty"), dated as of June 18, 2007, by National
Professional Services Inc., a Delaware corporation, Pacific Environmental
Sampling, Inc., a California corporation, Allstate Home Inspection &
Environmental Testing, Ltd., a Delaware corporation, each with an address of
c/oEnvironmental Service Professionals, Inc., 0000 Xxxx Xxxxxxxx Xxxxxx Xxx,
Xxxxx 000, Xxxx Xxxxxxx, Xxxxxxxxxx 00000 (each a "Guarantor", collectively, the
"Guarantors"), in favor of BOCA FUNDING, LLC with an office at 000 Xxxx 00xx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX (the "Secured Party").
WHEREAS, the Guarantors are subsidiaries or affiliates of ENVIRONMENTAL
SERVICE PROFESSIONALS, INC. (the "Borrower"); and
WHEREAS, in accordance with a certain senior secured convertible note,
dated as of the date hereof (the "Note"), executed by the Borrower, and certain
related agreements between the Borrower and the Secured Party (collectively, as
amended, restated, or extended from time to time, the "Loan Documents"),
theSecured Party has agreed to loan to the Borrower up to SIX HUNDRED AND
FIFTEEN THOUSAND Dollars ($615,000) (the "Loan"); and
WHEREAS, the Secured Party's willingness to extend the loan is
conditioned upon the Guarantors executing and delivering this Guaranty; and
WHEREAS, the aforesaid Loan will be beneficial to the Guarantors
inasmuch as the proceeds of the Loan to the Borrower will indirectly benefit the
Guarantors;
NOW, THEREFORE, in order to induce the Secured Party to make the Loan
to the Borrower pursuant to the Loan Documents, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
each of the Guarantors, the Guarantors hereby agree as follows:
1. GUARANTY OF PAYMENT AND PERFORMANCE. The Guarantors hereby jointly
and severally guarantee to the Secured Party the full and punctual payment when
due (whether at maturity, by acceleration or otherwise), and the performance, of
all liabilities, agreements and other obligations of the Borrower to the Secured
Party, whether direct or indirect, absolute or contingent, due or to become due,
secured or unsecured, now existing or hereafter arising or acquired (whether by
way of discount, letter of credit, lease, loan, overdraft or otherwise),
including without limitation all obligations under the Note (collectively, the
"Obligations"). This Guaranty is an absolute, unconditional and continuing
guaranty of the full and punctual payment and performance of the Obligations and
not of their collectibility only and is in no way conditioned upon any
requirement that the Secured Party first attempt to collect any of the
Obligations from the Borrower or resort to any security or other means of
obtaining their payment. Should the Borrower default in the payment or
performance of any of the Obligations, the obligations of each Guarantor
hereunder shall become immediately due and payable to the Secured Party, without
demand or notice of any nature, all of which are expressly waived by each
Guarantor. Payments by each Guarantor hereunder may be required by the Secured
Party on any number of occasions.
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2. GUARANTORS' AGREEMENT TO PAY. Each Guarantor further agrees, as the
principal obligor and not as a guarantor only, to pay to the Secured Party, on
demand, all reasonable costs and expenses (including court costs and reasonable
legal expenses) incurred or expended by the Secured Party in connection with
enforcement of this Guaranty, together with interest on amounts recoverable
under this Guaranty from the time such amounts become due under this Guaranty
until payment, at the rate per annum equal to the default rate set forth in the
Note; provided that if such interest exceeds the maximum amount permitted to be
paid under applicable law, then such interest shall be reduced to such maximum
permitted amount.
3. UNLIMITED GUARANTY. The liability of each Guarantor hereunder shall
be unlimited to the extent of the Obligations and the other obligations of each
Guarantor hereunder (including, without limitation, under Section 2 above).
4. WAIVERS BY GUARANTORS; SECURED PARTY'S FREEDOM TO ACT. Each
Guarantor agrees that the Obligations will be paid and performed strictly in
accordance with their respective terms 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 Secured Party with respect thereto. Each Guarantor waives
presentment, demand, protest, notice of acceptance, notice of Obligations
incurred and all other notices of any kind, all defenses which may be available
to Borrower by virtue of any valuation, stay, moratorium law or other similar
law now or hereafter in effect, any right to require the marshalling of assets
of the Borrower, and all suretyship defenses generally. Without limiting the
generality of the foregoing, each Guarantor agrees to the provisions of any
instrument evidencing, securing or otherwise executed in connection with any
Obligation and agrees that the obligations of each Guarantor hereunder shall not
be released or discharged, in whole or in part, or otherwise affected by (i) the
failure of the Secured Party to assert any claim or demand or to enforce any
right or remedy against the Borrower; (ii) any extensions or renewals of any
Obligation; (iii) any rescissions, waivers, amendments or modifications of any
of the terms or provisions of any agreement evidencing, securing or otherwise
executed in connection with any Obligation (provided, that, the obligations of
each Guarantor hereunder shall be appropriately modified to reflect any
amendment or modification of the Obligations); (iv) the substitution or release
of any entity primarily or secondarily liable for any Obligation; (v) the
adequacy of any rights the Secured Party may have against any collateral or
other means of obtaining repayment of the Obligations; (vi) the impairment of
any collateral securing the Obligations, including without limitation the
failure to perfect or preserve any rights the Secured Party might have in such
collateral or the substitution, exchange, surrender, release, loss or
destruction of any such collateral; or (vii) any other act or omission which
might in any manner or to any extent vary the risk of any Guarantor or otherwise
operate as a release or discharge of any other Guarantor, all of which may be
done without notice to any Guarantor.
5. UNENFORCEABILITY OF OBLIGATIONS AGAINST BORROWER. If for any reason
the Borrower has no legal existence or is under no legal obligation to discharge
any of the Obligations, or if any of the Obligations have become irrecoverable
from the Borrower by operation of law or for any other reason, this Guaranty
shall nevertheless be binding on each Guarantor to the same extent as if each
Guarantor at all times had been the principal obligor on all such Obligations.
In the event that acceleration of the time for payment of the Obligations is
stayed upon the insolvency, bankruptcy or reorganization of the Borrower, or for
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any other reason, all such amounts otherwise subject to acceleration under the
terms of any agreement evidencing, securing or otherwise executed in connection
with any Obligation shall be immediately due and payable by each Guarantor.
6. SUBROGATION; SUBORDINATION. Until the payment and performance in
full of all Obligations and any and all obligations of the Borrower to any
affiliate of the Secured Party, no Guarantor shall exercise any rights against
the Borrower arising as a result of payment by any Guarantor hereunder, by way
of subrogation or otherwise, and will not prove any claim in competition with
the Secured Party or its affiliates in respect of any payment hereunder in
bankruptcy or insolvency proceedings of any nature; no Guarantor will claim any
set-off or counterclaim against the Borrower in respect of any liability of any
Guarantor to the Borrower; and each Guarantor waives any benefit of and any
right to participate in any collateral which may be held by the Secured Party or
any such affiliate. The payment of any amounts due with respect to any
indebtedness of the Borrower now or hereafter held by any Guarantor is hereby
subordinated to the prior payment in full of the Obligations. Each Guarantor
agrees that after the occurrence of any default in the payment or performance of
the Obligations, after the expiration of any applicable cure period, it will not
demand, xxx for or otherwise attempt to collect after such time any such
indebtedness of the Borrower to such Guarantor until the Obligations shall have
been paid in full. If, notwithstanding the foregoing sentence, any Guarantor
shall collect, enforce or receive any amounts in respect of such indebtedness,
such amounts shall be collected, enforced and received by such Guarantor as
trustee for the Secured Party and be paid over to the Secured Party on account
of the Obligations without affecting in any manner the liability of any
Guarantor under the other provisions of this Guaranty.
7. FURTHER ASSURANCES. Each Guarantor agrees to do all such things and
execute all such documents, as the Secured Party may consider reasonably
necessary or desirable to give full effect to this Guaranty and to perfect and
preserve the rights and powers of the Secured Party hereunder.
8. TERMINATION; REINSTATEMENT. This Guaranty shall remain in full force
and effect until the earlier of: (i) the Obligations are paid in full (other
than contingent indemnity obligations), and not subject to any recapture or
preference in bankruptcy or similar proceedings, and the Secured Party has no
further commitment to extent credit to the Borrower or (ii) the Secured Party is
given written notice of each Guarantor's intention to discontinue this Guaranty,
notwithstanding any intermediate or temporary payment or settlement of the whole
or any part of the Obligations. No such notice under (ii) above shall be
effective unless received and acknowledged by an officer of the Secured Party at
its head office. No notice under (ii) above shall affect any rights of the
Secured Party or of any affiliate hereunder with respect to any Obligations
incurred prior to such notice. This Guaranty shall continue to be effective or
be reinstated, notwithstanding any notice or termination, if at any time any
payment made or value received with respect to an Obligation is rescinded or
must otherwise be returned by the Secured Party upon the insolvency, bankruptcy
or reorganization of the Borrower, or otherwise, all as though such payment had
not been made or value received.
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9. SUCCESSORS AND ASSIGNS. This Guaranty shall be jointly and severally
binding upon each Guarantor, its successors and assigns, and shall inure to the
benefit of and be enforceable by the Secured Party and its successors,
transferees and assigns. Without limiting the generality of the foregoing
sentence, the Secured Party may assign or otherwise transfer any agreement or
any note held by it evidencing, securing or otherwise executed in connection
with the Obligations, or sell participations in any interest therein, to any
other person or entity, and such other person or entity shall thereupon become
vested, to the extent set forth in the agreement evidencing such assignment,
transfer or participation, with all the rights in respect thereof granted to the
Secured Party herein.
10. AMENDMENTS AND WAIVERS. No amendment or waiver of any provision of
this Guaranty nor consent to any departure by any Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Secured Party.
No failure on the part of the Secured Party 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.
11. NOTICES. All notices and other communications called for hereunder
shall be made in writing and, unless otherwise specifically provided herein,
shall be deemed to have been duly made or given when delivered by hand or mailed
first class mail postage prepaid or, in the case of telegraphic or telexed
notice, when transmitted, answer back received, addressed as follows: if to the
Guarantors, at the address set forth above, and if to the Secured Party, at the
address set forth above, or at such address as either party may designate in
writing.
12. GOVERNING LAW; CONSENT TO JURISDICTION. This Guaranty shall be
governed by, and construed in accordance with, the laws of the State of New York
without reference to its conflicts of laws provisions. Each Guarantor agrees
that any suit for the enforcement of this Guaranty may be brought in the courts
of the State of New York or any federal court sitting therein and consents to
the non-exclusive jurisdiction of such court and to service of process in any
such suit being made upon the Guarantors by mail at the address specified in
Section 11 hereof. Each Guarantor hereby waives any objection that it may now or
hereafter have to the venue of any such suit or any such court or that such suit
was brought in an inconvenient court. Any enforcement action relating to this
Guarantee may be brought by motion for summary judgment in lieu of a complaint
pursuant to Section 3213 of the New York Civil Practice Law and Rules.
13. WAIVER OF JURY TRIAL. EACH GUARANTOR AND, BY ITS ACCEPTANCE OF THIS
GUARANTY, THE SECURED PARTY, HEREBY WAIVES TRIAL BY JURY IN ANY LITIGATION IN
ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF: (A) THIS
GUARANTY OR ANY OTHER INSTRUMENT OR DOCUMENT DELIVERED IN CONNECTION WITH THE
OBLIGATIONS; (B) THE VALIDITY, INTERPRETATION, COLLECTION OR ENFORCEMENT
THEREOF; OR (C) ANY OTHER CLAIM OR DISPUTE HOWEVER ARISING BETWEEN ANY GUARANTOR
AND THE SECURED PARTY.
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14. CERTAIN REFERENCES. All pronouns and any variations thereof shall
be deemed to refer to the masculine, feminine, neuter, singular or plural, as
the identity of the person, persons, entity or entities may require. The terms
"herein", "hereof" or "hereunder" or similar terms used in this Guaranty refer
to this entire Guaranty and not only to the particular provision in which the
term is used.
15. MISCELLANEOUS. This Guaranty, together with the Security Agreement,
delivered by the Guarantors as of the date hereof to the Secured Party,
constitutes the entire agreement of the Guarantors with respect to the matters
set forth herein. The rights and remedies herein provided are cumulative and not
exclusive of any remedies provided by law or any other agreement, and this
Guaranty shall be in addition to any other guaranty of the Obligations. The
invalidity or unenforceability of any one or more sections of this Guaranty
shall not affect the validity or enforceability of its remaining provisions.
Captions are for the ease of reference only and shall not affect the meaning of
the relevant provisions. The meanings of all defined terms used in this Guaranty
shall be equally applicable to the singular and plural, masculine, feminine and
generic forms of the terms defined. The obligations of each Guarantor shall be
joint and several.
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IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be executed and
delivered as of the date appearing in the introductory paragraph of this
Guaranty.
NATIONAL PROFESSIONAL SERVICES INC.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
PACIFIC ENVIRONMENTAL SAMPLING, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
ALLSTATE HOME INSPECTION & ENVIRONMENTAL TESTING, LTD.
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
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