GUARANTY
FOR VALUE
RECEIVED, and in consideration of note
purchases from, loans made or to be made or credit otherwise extended or to be
extended by Laurus Master Fund, Ltd. (“Laurus”) to or for the account of House
of Brussels Chocolates Inc., a Nevada corporation or any other Eligible U.S.
Subsidiary (as defined in the Security Agreement referred to below)
(collectively, the “Debtor”), from time to time and at any time and for other
good and valuable consideration and to induce Xxxxxx, in its discretion, to
purchase such notes, make such loans or other extensions of credit and to make
or grant such renewals, extensions, releases of collateral or relinquishments of
legal rights as Xxxxxx may deem advisable, each of the undersigned (and each of
them if more than one, the liability under this Guaranty being joint and
several) (jointly and severally referred to as “Guarantors” or “the
undersigned”) irrevocably and unconditionally guarantees to Laurus, its
successors, endorsees and assigns the prompt payment when due (whether by
acceleration or otherwise) of all present and future obligations and liabilities
of any and all kinds of Debtor to Laurus and of all instruments of any nature
evidencing or relating to any such obligations and liabilities upon which Debtor
or one or more parties and Debtor is or may become liable to Laurus, whether
incurred by Debtor as maker, endorser, drawer, acceptor, guarantors ,
accommodation party or otherwise, and whether due or to become due, secured or
unsecured, absolute or contingent, joint or several, and however or whenever
acquired by Xxxxxx, whether arising under, out of, or in connection with
(i) that certain Securities Purchase Agreement dated as of the date hereof by
and between the Debtor and Laurus (the “Securities Purchase Agreement”) and (ii)
each Related Agreement referred to in the Securities Purchase Agreement, (iii)
that certain Security Agreement dated as of the date hereof by and among the
Debtor , certain other entities named therein and Laurus (the “Security
Agreement”) and (iv) each Ancillary Agreement referred to in the Security
Agreement (the Securities Purchase Agreement and each Related Agreement and the
Security Agreement and each Ancillary Agreement, as each may be amended,
modified, restated or supplemented from time to time, are collectively referred
to herein as the “Documents”), or any documents, instruments or agreements
relating to or executed in connection with the Documents or any documents,
instruments or agreements referred to therein or otherwise, or any other
indebtedness, obligations or liabilities of the Debtor to Laurus, whether now
existing or hereafter arising, direct or indirect, liquidated or unliquidated,
absolute or contingent, due or not due and whether under, pursuant to or
evidenced by a note, agreement, guaranty, instrument or otherwise (all of which
are herein collectively referred to as the “Obligations”), and irrespective of
the genuineness, validity, regularity or enforceability of such Obligations, or
of any instrument evidencing any of the Obligations or of any collateral
therefor or of the existence or extent of such collateral, and irrespective of
the allowability, allowance or disallowance of any or all of the Obligations in
any case commenced by or against Debtor under Title 11, United States Code, the
Bankruptcy and Insolvency Act (Canada) (the “BIA”) and the Companies’ Creditors
Arrangement Act (the “CCAA”) including, without limitation, obligations or
indebtedness of Debtor for post-petition interest, fees, costs and charges that
would have accrued or been added to the Obligations but for the commencement of
such case. Terms not otherwise defined herein shall have the meaning assigned
such terms in the Securities Purchase Agreement and the Security Agreement, as
applicable]. In furtherance of the foregoing, the undersigned xxxxxx agrees as
follows:
1. No
Impairment. Laurus
may at any time and from time to time, either before or after the maturity
thereof, without notice to or further consent of the undersigned, extend the
time of payment of, exchange or surrender any collateral for, renew or extend
any of the Obligations or increase or decrease the interest rate thereon, or any
other agreement with Debtor or with any other party to or person liable on any
of the Obligations, or interested therein, for the extension, renewal, payment,
compromise, discharge or release thereof, in whole or in part, or for any
modification of the terms thereof or of any agreement between Laurus and Debtor
or any such other party or person, or make any election of rights Laurus may
deem desirable under the United States Bankruptcy Code, as amended, the BIA, the
CCAA or any other federal, provincial or state bankruptcy, reorganization,
moratorium or insolvency law relating to or affecting the enforcement of
creditors’ rights generally (any of the foregoing, an “Insolvency Law”) without
in any way impairing or affecting this Guaranty. This Guaranty shall be
effective regardless of the subsequent incorporation, merger, amalgamation or
consolidation of Debtor or Guarantors, or any change in the composition, nature,
personnel or location of Debtor or Guarantors and shall extend to any successor
entity to Debtor or Guarantors, including a debtor in possession or the like
under any Insolvency Law.
2. Guaranty
Absolute. Subject
to Section 6(c) hereof,
each of the undersigned jointly and severally guarantees that the Obligations
will be paid strictly in accordance with the terms of the Documents and/or any
other document, instrument or agreement creating or evidencing the Obligations,
regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of Debtor with respect
thereto. Guarantors hereby knowingly accept the full range of risk encompassed
within a contract of “continuing guaranty” which risk includes the possibility
that Debtor will contract additional indebtedness for which Guarantors may be
liable hereunder after Xxxxxx’s financial condition or ability to pay its lawful
debts when they fall due has deteriorated, whether or not Debtor has properly
authorized incurring such additional indebtedness. The undersigned acknowledge
that (i) no oral representations, including any representations to extend credit
or provide other financial accommodations to Debtor, have been made by Xxxxxx to
induce the undersigned to enter into this Guaranty and (ii) any extension of
credit to the Debtor shall be governed solely by the provisions of the
Documents. The liability of each of the undersigned under this Guaranty shall be
absolute and unconditional, in accordance with its terms, and shall remain in
full force and effect without regard to, and shall not be released, suspended,
discharged, terminated or otherwise affected by, any circumstance or occurrence
whatsoever, including, without limitation: (a) any waiver, indulgence, renewal,
extension, amendment or modification of or addition, consent or supplement to or
deletion from or any other action or inaction under or in respect of the
Documents or any other instruments or agreements relating to the Obligations or
any assignment or transfer of any thereof, (b) any lack of validity or
enforceability of any Document or other documents, instruments or agreements
relating to the Obligations or any assignment or transfer of any thereof, (c)
any furnishing of any additional security to Laurus or its assignees or any
acceptance thereof or any release of any security by Laurus or its assignees,
(d) any limitation on any party’s liability or obligation under the Documents or
any other documents, instruments or agreements relating to the Obligations or
any assignment or transfer of any thereof or any invalidity or unenforceability,
in whole or in part, of any such document, instrument or agreement or any term
thereof, (e) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating to
Debtor, or any action taken with respect to this Guaranty by any trustee,
receiver, interim receiver, or receiver and manager, or by any court, in any
such proceeding, whether or not the undersigned shall have notice or knowledge
of any of the foregoing, (f) any exchange, release or nonperfection of any
collateral, or any release, or amendment or waiver of or consent to departure
from any guaranty or security, for all or any of the Obligations or (g) any
other circumstance which might otherwise constitute a defense available to, or a
discharge of, the undersigned. Any amounts due from the undersigned to Laurus
shall bear interest until such amounts are paid in full at the highest rate then
applicable to the Obligations. Obligations include post-petition interest
whether or not allowed or allowable.
2
3. Waivers.
|
(a) |
This
Guaranty is a guaranty of payment and not of collection. Laurus shall be
under no obligation to institute suit, exercise rights or remedies or take
any other action against Debtor or any other person or entity liable with
respect to any of the Obligations or resort to any collateral security
held by it to secure any of the Obligations as a condition precedent to
the undersigned being obligated to perform as agreed herein and each of
the Guarantors hereby waives any and all rights which it may have by
statute or otherwise which would require Laurus to do any of the
foregoing. The obligations of each Guarantor hereunder are independent of
the Obligations and a separate action or actions may be brought and
prosecuted against each Guarantor to enforce this Guaranty, irrespective
of whether any action is brought against Debtor or whether Xxxxxx is
joined in any such action or actions. Each of the Guarantors further
consents and agrees that Xxxxxx shall be under no obligation to marshal
any assets in favor of Guarantors, or against or in payment of any or all
of the Obligations. The undersigned hereby waives all suretyship defenses
and any rights to interpose any defense, counterclaim or offset of any
nature and description which the undersigned may have or which may exist
between and among Laurus, Debtor and/or the undersigned with respect to
the undersigned’s obligations under this Guaranty, or which Debtor may
assert on the underlying debt, including but not limited to failure of
consideration, breach of warranty, fraud, payment (other than cash payment
in full of the Obligations), statute of frauds, bankruptcy, infancy,
statute of limitations, accord and satisfaction, and usury.
|
|
(b) |
Each
of the undersigned further waives (i) notice of the acceptance of this
Guaranty, of the making of any such loans or extensions of credit, and of
all notices and demands of any kind to which the undersigned may be
entitled, including, without limitation, notice of adverse change in
Debtor’s financial condition or of any other fact which might materially
increase the risk of the undersigned and (ii) presentment to or demand of
payment from anyone whomsoever liable upon any of the Obligations,
protest, notices of presentment, non-payment or protest and notice of any
sale of collateral security or any default of any
sort. |
3
|
|
(c) |
Notwithstanding
any payment or payments made by the undersigned hereunder, or any setoff
or application of funds of the undersigned by Xxxxxx, the undersigned
shall not be entitled to be subrogated to any of the rights of Xxxxxx
against Debtor or against any collateral or guarantee or right of offset
held by Xxxxxx for the payment of the Obligations, nor shall the
undersigned seek or be entitled to seek any contribution, indemnification
or reimbursement from Debtor in respect of payments made by the
undersigned hereunder, until all amounts owing to Laurus by Debtor on
account of the Obligations are indefeasibly paid in full and Laurus’
obligation to extend credit pursuant to the Documents has been irrevocably
terminated. If, notwithstanding the foregoing, any amount shall be paid to
the undersigned on account of such subrogation rights at any time when all
of the Obligations shall not have been paid in full and Laurus’ obligation
to extend credit pursuant to the Documents shall not have been terminated,
such amount shall be held by the undersigned in trust for Laurus,
segregated from other funds of the undersigned, and shall forthwith upon,
and in any event within two (2) business days of, receipt by the
undersigned, be turned over to Laurus in the exact form received by the
undersigned (duly endorsed by the undersigned to Laurus, if required), to
be applied against the Obligations, whether matured or unmatured, in such
order as Laurus may determine, subject to the provisions of the Documents.
Any and all present and future debts and obligations of Debtor to any of
the undersigned are hereby waived and postponed in favor of, and
subordinated to the full payment and performance of, all present and
future debts and Obligations of Debtor to
Xxxxxx. |
4. Indemnity.
As an original and independent obligation under this Guaranty each Guarantor
shall:
|
(a) |
indemnify
Laurus and keep Xxxxxx indemnified against any cost, loss, expense or
liability of whatever kind resulting from the failure by Debtor to make
due and punctual payment of any of the Obligations or resulting from any
of the Obligations being or becoming void, voidable, unenforceable or
ineffective against Debtor (including, but without limitation, all legal
and other costs, charges and expenses incurred by Laurus, in connection
with preserving or enforcing, or attempting to preserve or enforce, its
rights under this Guaranty); and |
|
(b) |
pay
on demand the amount of such cost, loss, expense or liability whether or
not Xxxxxx has attempted to enforce any rights against any Debtor or any
other person or otherwise. |
5. Security. All
sums at any time to the credit of the undersigned and any property of the
undersigned in Laurus’ possession or in the possession of any bank, financial
institution or other entity that directly or indirectly, through one or more
intermediaries, controls or is controlled by, or is under common control with,
Laurus (each such entity, an “Affiliate”) shall be deemed held by Laurus or such
Affiliate, as the case may be, as security for any and all of the undersigned’s
obligations to Laurus and to any Affiliate of Laurus, no matter how or when
arising and whether under this or any other instrument, agreement or otherwise.
6. Representations
and Warranties. Each of
the undersigned respectively, hereby jointly and severally represents and
warrants (all of which representations and warranties shall survive until all
Obligations are indefeasibly satisfied in full and the Documents have been
irrevocably terminated), that:
|
(a) |
Corporate
Status.
It is a corporation, partnership or limited liability company, as the case
may be, duly formed, validly existing and in good standing under the laws
of its jurisdiction of formation indicated on the signature page hereof
and has full power, authority and legal right to own its property and
assets and to transact the business in which it is
engaged. |
4
|
(b) |
Authority
and Execution.
It has full power, authority and legal right to execute and deliver, and
to perform its obligations under, this Guaranty and has taken all
necessary corporate, partnership or limited liability company, as the case
may be, action to authorize the execution, delivery and performance of
this Guaranty. |
|
(c) |
Legal,
Xxxxx and Binding Character.
This Guaranty constitutes its legal, valid and binding obligation
enforceable in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other laws of general application affecting the enforcement of
creditor’s rights and general principles of equity that restrict the
availability of equitable or legal remedies. |
|
(d) |
Violations.
The execution, delivery and performance of this Guaranty will not violate
any requirement of law applicable to it or any contract, agreement or
instrument to which it is a party or by which it or any of its property is
bound or result in the creation or imposition of any mortgage, lien or
other encumbrance other than in favor of Xxxxxx on any of its property or
assets pursuant to the provisions of any of the foregoing, which, in any
of the foregoing cases, could reasonably be expected to have, either
individually or in the aggregate, a Material Adverse
Effect. |
|
(e) |
Consents
or Approvals.
No consent of any other person or entity (including, without limitation,
any creditor of the undersigned) and no consent, license, permit, approval
or authorization of, exemption by, notice or report to, or registration,
filing or declaration with, any governmental authority is required in
connection with the execution, delivery, performance, validity or
enforceability of this Guaranty by it, except to the extent that the
failure to obtain any of the foregoing could not reasonably be expected to
have, either individually or in the aggregate, a Material Adverse
Effect. |
|
(f) |
Litigation.
Except as set forth in Schedule 6(f), no litigation, arbitration,
investigation or administrative proceeding of or before any court,
arbitrator or governmental authority, bureau or agency is currently
pending or, to the best of its knowledge, threatened (i) with respect to
this Guaranty or any of the transactions contemplated by this Guaranty or
(ii) against or affecting it, or any of its property or assets, which, in
each of the foregoing cases, if adversely determined, could reasonably be
expected to have a Material Adverse Effect. |
|
(g) |
Financial
Benefit.
It has derived or expects to derive a financial or other advantage from
each and every loan, advance or extension of credit made under the
Documents or other Obligation incurred by the Debtor to
Laurus. |
|
(h) |
Solvency.
As of the date of this Guaranty, (a) the fair saleable value of its assets
exceeds its liabilities and (b) it is meeting its current liabilities as
they mature. |
5
7. Acceleration.
|
(a) |
If
any breach of any covenant or condition or other event of default shall
occur and be continuing under any agreement made by Debtor or any of the
undersigned to Laurus, or either Debtor or any of the undersigned should
at any time become insolvent, or make a general assignment, or if a
proceeding in or under any Insolvency Law shall be filed or commenced by,
or in respect of, any of the undersigned, or if a notice of any lien,
levy, or assessment is filed of record with respect to any assets of any
of the undersigned by the United States of America or Canada or any
respective department, agency, or instrumentalityof either country, or if
any taxes or debts owing at any time or times hereafter to any one of them
becomes a lien or encumbrance upon any assets of the undersigned in
Laurus’ possession, or otherwise, any and all Obligations shall for
purposes hereof, at Laurus’ option, be deemed due and payable without
notice notwithstanding that any such Obligation is not then due and
payable by Debtor. |
|
(b) |
Each
of the undersigned will promptly notify Laurus of any default by such
undersigned in its respective performance or observance of any term or
condition of any agreement to which the undersigned is a party if the
effect of such default is to cause, or permit the holder of any obligation
under such agreement to cause, such obligation to become due prior to its
stated maturity and, in the event that the amount of such obligations
exceeds, when taken together, $100,000 in the aggregate and such default
has not been cured or waived by the holder of such obligations on or prior
to the fifteenth (15th)
day after occurrence thereof. If such an event occurs, Xxxxxx shall have
the right to accelerate such undersigned’s obligations
hereunder. |
8. Payments
from Guarantors. Laurus,
in its sole and absolute discretion, with or without notice to the undersigned,
may apply on account of the Obligations any payment from the undersigned or any
other guarantors, or amounts realized from any security for the Obligations, or
may deposit any and all such amounts realized in a non-interest bearing cash
collateral deposit account to be maintained as security for the
Obligations.
9. Additional
Amounts. Any and all payments by each Guarantor hereunder, and any amounts on
account of interest or deemed interest, shall be made free and clear of and
without deduction for any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding taxes imposed on net income or franchise taxes of Laurus by the
jurisdiction in which such person is organized or has its principal office (all
such non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities, collectively or individually, “Taxes”). If any Guarantor shall be
required to deduct any Taxes from or in respect of any sum payable hereunder to
Xxxxxx, (i) the sum payable shall be increased by the amount (an “additional
amount”) necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 9) Laurus
shall receive an amount equal to the sum it would have received had no such
deductions been made, (ii) such Guarantor shall make such deductions and (iii)
such Guarantor shall pay the full amount deducted to the relevant governmental
authority in accordance with applicable law.
In
addition, each Guarantor agrees to pay to the relevant governmental authority in
accordance with applicable law any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies that arise from
any payment made hereunder or from the execution, delivery or registration of,
or otherwise with respect to, this Guaranty (“Other Taxes”). Each Guarantor
shall deliver to Laurus official receipts, if any, in respect of any Taxes or
Other Taxes payable hereunder promptly after payment of such Taxes or Other
Taxes or other evidence of payment reasonably acceptable to Xxxxxx.
6
Each
Guarantor hereby indemnifies and agrees to hold Xxxxxx harmless from and against
Taxes and Other Taxes (including, without limitation, Taxes and Other Taxes
imposed on any amounts payable under this Section 9) paid by such person,
whether or not such Taxes or Other Taxes were correctly or legally asserted.
Such indemnification shall be paid within ten (10) days from the date on which
any such person makes written demand therefore specifying in reasonable detail
the nature and amount of such Taxes or Other Taxes.
10. Costs. The
undersigned shall pay on demand, all costs, fees and expenses (including,
without limitation, expenses for legal services of every kind) relating or
incidental to the enforcement or protection of the rights of Laurus hereunder or
under any of the Obligations.
11. No
Termination. This is
a continuing irrevocable guaranty and shall remain in full force and effect and
be binding upon the undersigned, and each of the undersigned’s successors and
assigns, until all of the Obligations have been indefeasibly paid in full and
Laurus’ obligation to extend credit pursuant to the Documents has been
irrevocably terminated. If any of the present or future Obligations are
guaranteed by persons, partnerships or entities in addition to the undersigned,
the death, release or discharge in whole or in part or the bankruptcy,
amalgamation, merger, consolidation, incorporation, liquidation or dissolution
of one or more of them shall not discharge or affect the liabilities of any
undersigned under this Guaranty.
12. Recapture.
Anything in this Guaranty to the contrary notwithstanding, if Xxxxxx receives
any payment or payments on account of the liabilities guaranteed hereby, 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 a
trustee, receiver, interim receiver or receiver and manager or any other party
under any Insolvency Law, common law or equitable doctrine, then to the extent
of any sum not finally retained by Xxxxxx, the undersigned’s obligations to
Xxxxxx shall be reinstated and this Guaranty shall remain in full force and
effect (or be reinstated) until payment shall have been made to Laurus, which
payment shall be due on demand.
13. Books
and Records. The
books and records of Xxxxxx showing the account between Xxxxxx and Debtor shall
be admissible in evidence in any action or proceeding, shall be binding upon the
undersigned for the purpose of establishing the items therein set
forth.
14. No
Waiver. No
failure on the part of Laurus to exercise, and no delay in exercising, any
right, remedy or power hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise by Xxxxxx of any right, remedy or power hereunder
preclude any other or future exercise of any other legal right, remedy or power.
Each and every right, remedy and power hereby granted to Laurus or allowed it by
law or other agreement shall be cumulative and not exclusive of any other, and
may be exercised by Xxxxxx at any time and from time to time.
15. Waiver
of Jury Trial. EACH OF
THE UNDERSIGNED DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH OF THE UNDERSIGNED HERETO WAIVES
ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO
RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN
LAURUS, AND/OR ANY OF THE UNDERSIGNED ARISING OUT OF, CONNECTED WITH, RELATED OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
GUARANTY, ANY DOCUMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO.
7
16. Governing
Law; Jurisdiction. THIS
GUARANTY CANNOT BE CHANGED OR TERMINATED ORALLY, AND SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS. EACH OF THE UNDERSIGNED HEREBY CONSENTS AND
AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE
OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS
OR DISPUTES BETWEEN ANY OF THE UNDERSIGNED, ON THE ONE HAND, AND LAURUS, ON THE
OTHER HAND, PERTAINING TO THIS GUARANTY OR ANY OF THE DOCUMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATED TO THIS GUARANTY OR ANY OF THE DOCUMENTS; PROVIDED, THAT
EACH OF THE UNDERSIGNED ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE
TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW
YORK; AND FURTHER PROVIDED, THAT
NOTHING IN THIS GUARANTY SHALL BE DEEMED OR OPERATE TO PRECLUDE LAURUS FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT
THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF LAURUS.
EACH OF THE UNDERSIGNED EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH
UNDERSIGNED HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF
PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH OF
THE UNDERSIGNED HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND
OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO SUCH UNDERSIGNED IN ACCORDANCE WITH SECTION 21 AND THAT
SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH UNDERSIGNED’S
ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
POSTAGE PREPAID IF SENT BY REGISTERED OR CERTIFIED MAIL.
17. Understanding
With Respect to Waivers and Consents. Each
Guarantor warrants and agrees that each of the waivers and consents set forth in
this Guaranty is made voluntarily and unconditionally after consultation with
outside legal counsel and with full knowledge of its significance and
consequences, with the understanding that events giving rise to any defense or
right waived may diminish, destroy or otherwise adversely affect rights which
such Guarantor otherwise may have against the Debtor, Laurus or any other person
or entity or against any collateral. If, notwithstanding the intent of the
parties that the terms of this Guaranty shall control in any and all
circumstances, any such waivers or consents are determined to be unenforceable
under applicable law, such waivers and consents shall be effective to the
maximum extent permitted by law.
8
18. Judgment
Currency. If, for the purpose of obtaining or enforcing judgment against any
Guarantor in any court in any jurisdiction, it becomes necessary to convert into
any other currency (such other currency being hereinafter in this section
referred to as the “Judgment Currency”) an amount due under this Guaranty in any
currency (the “Obligation Currency”) other than the Judgment Currency, the
conversion shall be made at the rate of exchange prevailing on the business day
immediately preceding (a) the date of actual payment of the amount due, in the
case of any proceeding in the courts of New York or in the courts of any other
jurisdiction that will give effect to such conversion being made on such date,
or (b) the date on which the foreign court determines, in the case of any
proceeding in the courts of any other jurisdiction (the applicable date as of
which such conversion is made pursuant to this section being hereinafter in this
section referred to as the “Judgment Conversion Date”).
If, in
the case of any proceeding in the court of any jurisdiction referred to in the
preceding paragraph, there is a change in the rate of exchange prevailing
between the Judgment Conversion Date and the date of actual receipt of the
amount due in immediately available funds, the Guarantor shall pay such
additional amount (if any, but in any event not a lesser amount) as may be
necessary to ensure that the amount actually received in the Judgment Currency,
when converted at the rate of exchange prevailing on the date of payment, will
produce the amount of the Obligation Currency which could have been purchased
with the amount of the Judgment Currency stipulated in the judgment or judicial
order at the rate of exchange prevailing on the Judgment Conversion Date. Any
amount due from any Guarantor under this section shall be due as a separate debt
and shall not be affected by judgment being obtained for any other amounts due
under or in respect of this Guaranty.
19. Severability. To the
extent permitted by applicable law, 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 hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
20. Amendments,
Waivers. No
amendment or waiver of any provision of this Guaranty nor consent to any
departure by the undersigned therefrom shall in any event be effective unless
the same shall be in writing executed by each of the undersigned directly
affected by such amendment and/or waiver and Xxxxxx.
21. Notice. All
notices, requests and demands to or upon the undersigned, shall be in writing
and shall be deemed to have been duly given or made (a) when delivered, if by
hand, (b) three (3) days after being sent, postage prepaid, if by registered or
certified mail, (c) when confirmed electronically, if by facsimile, or (d) when
delivered, if by a recognized overnight delivery service in each event, to the
numbers and/or address set forth beneath the signature of the
undersigned.
22. Counterparts.
This
Guaranty may be executed in any number of counterparts which shall, collectively
and separately constitute one agreement. Any signature delivered by a party by
facsimile transmission or by sending a scanned copy by electronic mail shall be
deemed an original signature hereto.
9
23. Successors. Laurus
may, from time to time, without notice to the undersigned, sell, assign,
transfer or otherwise dispose of all or any part of the Obligations and/or
rights under this Guaranty to any person or entity other than to a competitor of
any Debtor or Guarantor. Without limiting the generality of the foregoing,
Laurus may assign, or grant participations to, one or more banks, financial
institutions or other entities all or any part of any of the Obligations. In
each such event, Laurus, its Affiliates and each and every immediate and
successive purchaser, assignee, transferee or holder of all or any part of the
Obligations shall have the right to enforce this Guaranty, by legal action or
otherwise, for its own benefit as fully as if such purchaser, assignee,
transferee or holder were herein by name specifically given such right. Laurus
shall have an unimpaired right to enforce this Guaranty for its benefit with
respect to that portion of the Obligations which Xxxxxx has not disposed of,
sold, assigned, or otherwise transferred.
24. Joinder. It is
understood and agreed that any person or entity that desires to become a
Guarantor hereunder, or is required to execute a counterpart of this Guaranty
after the date hereof pursuant to the requirements of any Document, shall become
a Guarantor hereunder by (x) executing a Joinder Agreement in form and substance
satisfactory to Xxxxxx, (y) delivering supplements to such exhibits and annexes
to such Documents as Laurus shall reasonably request and (z) taking all actions
as specified in this Guaranty as would have been taken by such such Guarantor
had it been an original party to this Guaranty, in each case with all documents
required above to be delivered to Laurus and with all documents and actions
required above to be taken to the reasonable satisfaction of
Xxxxxx.
25. Release. Nothing
except indefeasible payment in full of the Obligations shall release any of the
undersigned from liability under this Guaranty.
26. Remedies
Not Exclusive. The
remedies conferred upon Xxxxxx in this Guaranty are intended to be in addition
to, and not in limitation of any other remedy or remedies available to
Laurus.
27. Limitation
of Obligations under this Guaranty. Each
Guarantor and Laurus (by its acceptance of the benefits of this Guaranty) hereby
confirms that it is its intention that this Guaranty not constitute a (i)
fraudulent transfer or conveyance for purposes of the Bankruptcy Code, the
Uniform
Fraudulent Conveyance Actor any
similar federal, provincial or state law; or (ii) a preference or a preferential
transfer for purposes of the BIA or under any other applicable bankruptcy,
insolvency or similar law now or hereafter in effect in any bankruptcy,
insolvency or similar proceeding with respect to Debtor. To effectuate the
foregoing intention, each Guarantor which is subject to the Bankruptcy Code, the
Uniform Fraudulent Conveyance Act or any similar US federal or state law and
Laurus (by its acceptance of the benefits of this Guaranty) hereby irrevocably
agrees that the Obligations guaranteed by such Guarantor shall be limited to
such amount as will, after giving effect to such maximum amount and all other
(contingent or otherwise) liabilities of such Guarantor that are relevant under
such laws and after giving effect to any rights to contribution pursuant to any
agreement providing for an equitable contribution among such Guarantor and the
other Guarantors (including this Guaranty), result in the Obligations of such
Guarantor under this Guaranty in respect of such maximum amount not constituting
a fraudulent transfer or conveyance, preference or preferential transfer.
[REMAINDER
OF THIS PAGE IS BLANK.
SIGNATURE
PAGE IMMEDIATELY FOLLOWS]
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IN
WITNESS WHEREOF, this Guaranty has been executed by the undersigned as of the
date and year here above written.
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
State
of Formation: Nevada | |
|
HOUSE
OF BRUSSELS CHOCOLATES (USA) LTD. | |
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
State
of Formation: Nevada | |
|
DEBAS
CHOCOLATE INC. | |
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
State
of Formation: California | |
|
CHOCOMED,
INC. | |
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
State
of Formation: Nevada |
11
|
HOUSE
OF BRUSSELS HOLDINGS LTD. | |
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
Jurisdiction
of Organization: BC | |
|
BRUSSELS
CHOCOLATES LTD. | |
|
By:____________________________________ | |
|
Name:__________________________________ | |
|
Title:___________________________________ | |
|
Address:________________________________ | |
|
Telephone:_______________________________ | |
|
Facsimile:________________________________ | |
|
Jurisdiction
of Organization: BC | |
| GOODMANS\MANTELLL\5141153.2 |
12
