GUARANTY
BY
TRANS HEALTHCARE, INC.
IN FAVOR OF
MONARCH PROPERTIES, INC.
DATED AS OF __________, 1998
GUARANTY
THIS GUARANTY (this "Guaranty") is given as of the ____ day of __________,
1998 ("Effective Date"), by TRANS HEALTHCARE, INC., a Delaware corporation
("Guarantor"), in favor of MONARCH PROPERTIES, LP, a Delaware limited
partnership ("Lessor").
RECITALS
A. Capitalized terms used but not otherwise defined herein shall have the
respective meanings given them in Section 1 below.
B. Concurrently herewith, Lessor and [Insert THI Lessee Subsidiary] ("THI
Subsidiary") have executed and delivered the Master Lease, pursuant to which
Lessor has leased to THI Subsidiary the respective Facilities. As security for
the payment and performance by THI Subsidiary of its respective obligations
under the Master Lease and the Transaction documents, THI Subsidiary has
executed and delivered to Lessor the Security Agreement, pursuant to which THI
Subsidiary has granted to Lessor security interests in certain property of THI
Subsidiary.
C. Guarantor owns all of the stock of THI Subsidiary and, accordingly,
benefits from the execution of the Master Lease.
D. As a material inducement to Lessor to enter into the Master Lease,
Guarantor has agreed to guarantee both the payment of all amounts due from, and
the performance of all obligations undertaken by, THI Subsidiary under the
Master Lease and the Transaction Documents.
NOW, THEREFORE, Guarantor agrees as follows:
1. DEFINED TERMS. The following terms shall have the respective meanings
given them below:
"Affiliate" means any Person who, directly or indirectly, Controls or is
Controlled by or is under common Control with another Person.
"Xxxxxx" means Xxxxxx Management Corporation, an [Insert State]
corporation.
"Control" (and its corollaries "Controlled by" and "under common Control
with") means possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, through the ownership
of voting securities, partnership interests or other equity interests.
"Event of Default" means an "Event of Default," as defined in the Master
Lease.
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"Facilities" means the facilities listed on EXHIBIT A hereto.
"Facility" means any of the Facilities.
"GAAP" means generally accepted accounting principles.
"Guaranty Default" means any of: (a) an Event of Default; (b) Guarantor's
failure to pay any amounts as and when required under this Guaranty; (c)
Guarantor's failure to observe and perform any covenant, condition or agreement
on its part to be observed or performed under this Guaranty (other than as
referred to in clause (b) above) for a period of seven (7) days or more after
Lessor has given written notice of such failure to Guarantor; or (d) the
occurrence and continuation of a default by any person other than Lessor under
any of the other Transaction Documents, if the default is not cured within any
applicable grace or cure period set forth therein.
"Intangible Assets" means the amount of (a) all unamortized debt discount
and expense, unamortized deferred charges, goodwill, patents, trademarks,
service marks, trade names, copyrights, organizational and developmental
expenses, unamortized operating rights, unamortized licenses, unamortized
leasehold rights and other intangible assets, or any write-up resulting from a
reversal of a reserve for bad debts or depreciation and any write-up resulting
from a change in methods of accounting or inventory, and (b) any investment in
any Affiliate.
"Master Lease" means the Master Lease of even date herewith executed and
delivered by Lessor and THI Subsidiary.
"Minimum Tangible Net Worth" means a Tangible Net Worth equal to [Insert
Dollar Amount] in United States currency.
"Net Income" means the net income of Guarantor, determined on an accrual
basis in accordance with GAAP, before federal, state and local income taxes, but
excluding extraordinary items.
"Obligations" means, collectively, all covenants and obligations contained
in the Master Lease and the other Transaction Documents, and any and all
amendments, modifications, extensions and renewals thereof, to be performed by
THI Subsidiary, and all damages that may result from the non-performance thereof
to the full extent provided under the Master Lease and the other Transaction
Documents.
"Person" means any natural person, trust, partnership, corporation, limited
liability company, joint venture or other legal entity.
"Purchase Agreement" means the Facilities Purchase Agreement dated as of
the date hereof among Xxxxxx, the entities listed on attached Exhibit A hereto,
Lessor and Guarantor.
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"Rent" means "Rent," as defined in the Master Lease.
"Security Agreement" means the Security Agreement of even date herewith
executed and delivered by THI Subsidiary and Lessor.
"Tangible Net Worth" means, at any date, the net worth of Guarantor and all
of its subsidiaries (including without limitation the Subsidiaries), as
determined on a consolidated basis in accordance with GAAP, less Intangible
Assets of Guarantor and all of its subsidiaries (including without limitation
the Subsidiaries).
THI Subsidiary means [Insert THI Lessee Subsidiary], a [Insert State]
corporation, that is a wholly owned subsidiary of Guarantor.
"Transaction Documents" means the Purchase Agreement, the Security
Agreement, and any other documents defined as Transaction Documents in the
Purchase Agreement and executed and/or delivered or caused to be executed and/or
delivered by THI Subsidiary and Guarantor pursuant to or in connection with the
Master Lease.
2. GUARANTY. Guarantor hereby unconditionally and irrevocably guarantees to
Lessor (a) the payment when due of all Rent and other sums payable by THI
Subsidiary under the Master Lease and the Transaction Documents and (b) the
faithful and prompt performance when due of each and every one of the
Obligations. Upon the occurrence of a Guaranty Default, Guarantor immediately
shall perform or cause to be performed the Obligations. Guarantor's liability
under this Guaranty is without limit. Guarantor's liability under this Guaranty
will continue until all of the Obligations have been performed in full.
3. SURVIVAL OF OBLIGATIONS. The obligations of Guarantor under this
Guaranty with respect to the Master Lease and the Transaction Documents shall
survive and continue in full force and effect notwithstanding:
(a) any amendment, modification or extension of the Master Lease or
any of the other Transaction Documents;
(b) any compromise, release, consent, extension, indulgence or other
action or inaction in respect of any terms of the Master Lease or
any of the other Transaction Documents or any other guarantor;
(c) any substitution or release, in whole or in part, of any security
for this Guaranty that Lessor may hold at any time;
(d) any exercise or nonexercise by Lessor of any right, power or
remedy under or in respect of the Master Lease or any of the
other Transaction Documents or
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any security held by Lessor with respect thereto, or any waiver
of any such right, power or remedy;
(e) any bankruptcy, insolvency, reorganization, arrangement,
adjustment, composition, liquidation or the like of THI
Subsidiary or any other guarantor;
(f) any limitation of THI Subsidiary's liability under the Master
Lease or the other Transaction Documents or any limitation of
such liability that now or hereafter may be imposed by any
statute, regulation or rule of law, or any illegality,
irregularity, invalidity or unenforceability, in whole or in
part, of the Master Lease or the other Transaction Documents or
any term thereof;
(g) any sale, lease or transfer of all or any part of any interest in
any Facility or any or all of the assets of THI Subsidiary to any
other person, firm or entity other than to Lessor;
(h) any act or omission by Lessor with respect to any of the security
instruments or any failure to file, record or otherwise perfect
any of the same;
(i) any extensions of time for performance under the Master Lease or
the other Transaction Documents, whether prior to or after
maturity;
(j) the release of any collateral from the lien of any of the
Security Agreements, or the release of THI Subsidiary from
performance or observation of any of the agreements, covenants,
terms or conditions contained in the Master Lease or any of the
other Transaction Documents by operation of law or otherwise;
(k) the fact that THI Subsidiary may or may not be personally liable,
in whole or in part, under the terms of the Master Lease or the
other Transaction Documents to pay any money judgment;
(l) the failure to give Guarantor any notice of acceptance, default
or otherwise;
(m) any other guaranty now or hereafter executed by Guarantor or
anyone else in connection with the Master Lease;
(n) any rights, powers or privileges that Lessor now or hereafter may
have against any other person, entity or collateral; or
(o) any other circumstances, whether or not Guarantor had notice or
knowledge thereof, which might otherwise constitute a defense
available to Guarantor.
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4. PRIMARY LIABILITY. The liability of Guarantor under this Guaranty is
primary, direct and immediate, and, upon the occurrence of a Guaranty Default,
Lessor may proceed against Guarantor: (a) prior to or in lieu of proceeding
against THI Subsidiary, its assets, any security deposit or any other guarantor;
and (b) prior to or in lieu of pursuing any other rights or remedies available
to Lessor. All rights and remedies afforded to Lessor by reason of this Guaranty
or by law are separate, independent and cumulative, and the exercise of any
rights or remedies shall not in any way limit, restrict or prejudice the
exercise of any other rights or remedies.
Upon the occurrence of a Guaranty Default, Lessor may bring and prosecute
against Guarantor an action or actions under this Guaranty, regardless of
whether THI Subsidiary is joined therein or a separate action or actions are
brought against THI Subsidiary. Lessor may maintain successive actions for other
defaults. Lessor's rights hereunder shall not be exhausted by its exercise of
any of its rights or remedies or by any such action or by any number of
successive actions until and unless all Obligations have been paid and fully
performed.
5. OBLIGATIONS NOT AFFECTED. In such manner, upon such terms and at such
times as Lessor in its sole discretion deems necessary or expedient, and without
notice to Guarantor, Lessor may: (a) amend, alter, compromise, accelerate,
extend or change the time or manner for the payment or the performance of the
Obligations; (b) extend, amend or terminate the Master Lease or any other
Transaction Document; or (c) release THI Subsidiary by consent to any assignment
(or otherwise) as to all or any portion of the obligations hereby guaranteed.
Any exercise or non-exercise by Lessor of any right hereby given Lessor, any
dealing by Lessor with Guarantor or any other guarantor, THI Subsidiary or other
person, or any change, impairment, release or suspension of any right or remedy
of Lessor against any person (including THI Subsidiary and any other guarantor)
will not affect any of the obligations of Guarantor hereunder or give Guarantor
any recourse or offset against Lessor.
6. WAIVER. Guarantor hereby waives and relinquishes all rights and remedies
accorded by applicable law to sureties and/or guarantors or any other
accommodation parties, under any statutory provisions, common law or any other
provision of law, custom or practice, and agrees not to assert or take advantage
of any such rights or remedies including, but not limited to:
(a) any right to require Lessor to proceed against THI Subsidiary or any
other person or to proceed against or exhaust any security held by
Lessor at any time or to pursue any other remedy in Lessor's power
before proceeding against Guarantor or to require that Lessor cause a
marshaling of THI Subsidiary's assets or the assets, if any, given as
collateral for this Guaranty or to proceed against any THI Subsidiary
and/or any collateral, including collateral, if any, given to secure
Guarantor's obligation under this Guaranty, held by Lessor at any time
or in any particular order;
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(b) any defense that may arise by reason of the incapacity or lack of
authority of any other person or persons;
(c) notice of the existence, creation or incurring of any new or
additional indebtedness or obligation or of any action or non-action
on the part of THI Subsidiary, Lessor, any creditor of THI Subsidiary
or Guarantor or on the part of any other person whomsoever under this
or any other instrument in connection with any obligation or evidence
of indebtedness held by Lessor or in connection with any obligation
hereby guaranteed;
(d) any defense based upon an election of remedies by Lessor that destroys
or otherwise impairs the subrogation rights of Guarantor or the right
of Guarantor to proceed against THI Subsidiary for reimbursement, or
both;
(e) any defense based upon any statute or rule of law that provides that
the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal;
(f) any duty on the part of Lessor to disclose to Guarantor any facts
Lessor may now or hereafter know about THI Subsidiary, regardless of
whether Lessor has reason to believe that any such facts materially
increase the risk beyond that which Guarantor intends to assume or has
reason to believe that such facts are unknown to Guarantor or has a
reasonable opportunity to communicate such facts to Guarantor, it
being understood and agreed that Guarantor is fully responsible for
being and keeping informed of the financial condition of THI
Subsidiary and of all circumstances bearing on the risk of non-payment
or non-performance of any obligations or indebtedness hereby
guaranteed;
(g) any defense arising because of Lessor's election, in any proceeding
instituted under the federal Bankruptcy Code, of the application of
Section 1111 (b)(2) of the federal Bankruptcy Code;
(h) any defense based on any borrowing or grant of a security interest
under Section 364 of the federal Bankruptcy Code; and
(i) all rights and remedies accorded by applicable law to guarantors,
including without limitation, any extension of time conferred by any
law now or hereafter in effect and any requirement or notice of
acceptance of this Guaranty or any other notice to which the
undersigned may now or hereafter be entitled to the extent such waiver
of notice is permitted by applicable law.
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7. WARRANTIES. Guarantor represents and warrants to Lessor that: (a) this
Guaranty is executed at the request of THI Subsidiary; and (b) Guarantor has
established adequate means of obtaining from THI Subsidiary, on a continuing
basis, financial and other information pertaining to financial condition.
Guarantor agrees to keep adequately informed from such means of any facts,
events or circumstances that might in any way affect Guarantor's risks
hereunder, and Guarantor further agrees that Lessor shall have no obligation to
disclose to Guarantor information or material acquired in the course of Lessor's
relationship with THI Subsidiary.
8. SUBROGATION. Guarantor shall defer until all obligations of THI
Subsidiary under the Master Lease and the other Transaction Documents have been
satisfied and discharged in full for one (1) year, its exercise of any right of
subrogation it may have, and any right to enforce any remedy that Lessor now has
or hereafter may have, against THI Subsidiary and any benefit of, and any right
to participate in, any security now or hereafter held by Lessor with respect to
the Master Lease and the other Transaction Documents.
9. SUBORDINATION. As long as a default exists and remains uncured under the
Master Lease or any of the other Transaction Documents, THI Subsidiary shall not
pay to Guarantor all or any part of any indebtedness or obligations owing by THI
Subsidiary to Guarantor, nor will Guarantor accept any payment of or on account
of any amounts owing, without the prior written consent of Lessor. Guarantor
shall cause THI Subsidiary to pay to Lessor all or any part of the subordinated
indebtedness until the obligations under the Master Lease or the other
Transaction Documents have been paid in full. Any payment by THI Subsidiary in
violation of this Guaranty shall be received by Guarantor in trust for Lessor,
and Guarantor shall cause the same to be paid to Lessor immediately on account
of the amounts owing from THI Subsidiary to Lessor. No such payment will reduce
or affect in any manner the liability of Guarantor under this Guaranty.
10. NO DELAY. Any payments required to be made by Guarantor hereunder
immediately shall become due on demand in accordance with the terms hereof upon
the occurrence of a Guaranty Default.
11. APPLICATION OF PAYMENTS. Lessor may, in its sole discretion, (a) apply
any or all payments or recoveries from THI Subsidiary or from any other
guarantor under any other instrument or realized from any security, in such
manner and order of priority as Lessor may determine, to any indebtedness or
other obligation of THI Subsidiary with respect to the Master Lease, regardless
of whether such indebtedness or other obligation is guaranteed hereby or is
otherwise secured or is due at the time of such application, and/or (b) refund
to THI Subsidiary any payment received by Lessor under the Master Lease.
12. GUARANTY DEFAULT. Upon the occurrence and continuation of a Guaranty
Default, Lessor shall have the right to bring such actions at law or in equity,
including
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appropriate injunctive relief, as it deems appropriate to compel compliance,
payment or deposit, and among other remedies to recover its reasonable
attorneys' fees in any proceeding, including any appeal therefrom and any
post-judgement proceedings.
13. FINANCIAL COVENANTS.
[TO BE DISCUSSED]
14. FINANCIAL STATEMENTS. Within fifty (50) days after the end of each of
Guarantor's fiscal quarters, Guarantor shall deliver to Lessor a copy of its
quarterly consolidated financial statements, prepared in accordance with GAAP,
consistently applied, and certified by an officer of Guarantor. Within one
hundred twenty (120) days after the end of each of Guarantor's fiscal years,
Guarantor shall deliver to Lessor a copy of its consolidated financial
statements, prepared in accordance with GAAP, consistently applied, and
certified by an officer of Guarantor and reported on by a "Big Six" certified
public accounting firm or other certified public accounting firm approved by
Lessor. Together with the Guarantor's financial statements furnished in
accordance with the preceding two (2) sentences, Guarantor shall deliver an
officer's certificate of Guarantor stating that Guarantor is not in default in
the performance or observance of any of the terms of this Guaranty, or, if
Guarantor is in default, specifying all such defaults, the nature thereof and
the steps being taken to remedy the same.
15. NOTICES. Any notice, request or other communication to be given by any
party hereunder shall be in writing and shall be sent by registered or certified
mail, postage prepaid, by overnight delivery or hand delivery to the following
address:
To Guarantor: Trans Healthcare, Inc.
0000 Xxxxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
With a copy to: Xxxxxxxxxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxx X. Xxxxxxxx, Esq.
Telephone No.: 000-000-0000
Fax No.: 000-000-0000
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To Lessor: Monarch Properties, LP
0000 Xxxxxxx Xxx Xxxxxxxxx - Xxxxx 000
Xxxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxxx
Telephone No.: 941/000-0000
Fax No.: 941/000-0000
With copy to: LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxx X. Xxxxxx, Xx.
Telephone No.: 212/000-0000
Facsimile No.: 212/424-8500
Notices shall be deemed given upon actual receipt.
16. MISCELLANEOUS.
(a) No term, condition or provision of this Guaranty may be waived except
by an express written instrument to that effect signed by Lessor. No waiver of
any term, condition or provision of this Guaranty will be deemed a waiver of any
other term, condition or provision, irrespective of similarity, or constitute a
continuing waiver of the same term, condition or provision, unless otherwise
expressly provided.
(b) If any one or more of the terms, conditions or provisions contained in
this Guaranty is found in a final award or judgment rendered by any court of
competent jurisdiction to be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining terms, conditions and
provisions of this Guaranty shall not in any way be affected or impaired
thereby, and this Guaranty shall be interpreted and construed as if the invalid,
illegal, or unenforceable term, condition or provision had never been contained
in this Guaranty.
(c) THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS CONFLICTS OF LAWS
PROVISIONS, EXCEPT THAT THE LAWS OF THE STATE IN WHICH A FACILITY IS LOCATED
SHALL GOVERN THIS AGREEMENT TO THE EXTENT NECESSARY (i) TO OBTAIN THE BENEFIT OF
THE RIGHTS AND REMEDIES SET FORTH HEREIN WITH RESPECT TO SUCH FACILITY AND (ii)
FOR PROCEDURAL REQUIREMENTS THAT MUST BE GOVERNED BY THE LAWS OF THE STATE IN
WHICH SUCH FACILITY IS LOCATED. GUARANTOR CONSENTS TO IN PERSONAM JURISDICTION
BEFORE THE STATE OR STATES AND FEDERAL COURTS OF NEW YORK AND AGREES THAT ALL
DISPUTES
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CONCERNING THIS GUARANTY SHALL BE HEARD IN THE STATE AND FEDERAL COURTS LOCATED
IN THE STATE OR STATES IN WHICH THE FACILITY OR FACILITIES ARE LOCATED OR IN NEW
YORK. GUARANTOR AGREES THAT SERVICE OF PROCESS MAY BE EFFECTED UPON IT UNDER ANY
METHOD PERMISSIBLE UNDER THE LAWS OF THE STATE OR STATES IN WHICH THE FACILITY
OR FACILITIES ARE LOCATED OR NEW YORK AND IRREVOCABLY WAIVES ANY OBJECTION TO
VENUE IN THE STATE AND FEDERAL COURTS OF THE STATE OR STATES IN WHICH THE
FACILITY OR FACILITIES ARE LOCATED AND OF NEW YORK.
(d) GUARANTOR AND LESSOR HEREBY WAIVE TRIAL BY JURY AND THE RIGHT THERETO
IN ANY ACTION OR PROCEEDING OF ANY KIND ARISING ON, UNDER, OUT OF, BY REASON OF
OR RELATING IN ANY WAY TO THIS GUARANTY OR THE INTERPRETATION, BREACH OR
ENFORCEMENT THEREOF.
(e) In the event of any suit, action, arbitration or other proceeding to
interpret this Guaranty, or to determine or enforce any right or obligation
created hereby, the prevailing party in the action shall recover such party's
actual costs and expenses reasonably incurred in connection therewith,
including, but not limited to, attorneys' fees and costs of appeal, post
judgment enforcement proceedings (if any) and bankruptcy proceedings (if any).
Any court, arbitrator or panel of arbitrators shall, in entering any judgment or
making any award in any such suit, action, arbitration or other proceeding, in
addition to any and all other relief awarded to such prevailing party, include
in such-judgment or award such party's costs and expenses as provided in this
paragraph.
(f) Guarantor (i) represents that it has been represented and advised by
counsel in connection with the execution of this Guaranty; (ii) acknowledges
receipt of a copy of the Master Lease and the other Transaction Documents; and
(iii) further represents that Guarantor has been advised by counsel with respect
thereto. This Guaranty shall be construed and interpreted in accordance with the
plain meaning of its language, and not for or against Guarantor or Lessor, and
as a whole, giving effect to all of the terms, conditions and provisions hereof.
(g) Except as provided in any other written agreement now or at any time
hereafter in force between Lessor and Guarantor, this Guaranty shall constitute
the entire agreement of Guarantor with Lessor with respect to the subject matter
hereof, and no representation, understanding, promise or condition concerning
the subject matter hereof will be binding upon Lessor or Guarantor unless
expressed herein.
(h) All stipulations, obligations, liabilities and undertakings under this
Guaranty shall be binding upon Guarantor and its respective successors and
assigns and shall inure to the benefit of Lessor and to the benefit of Lessor's
successors and assigns.
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(i) Whenever the singular shall be used hereunder, it shall be deemed to
include the plural (and vice-versa) and reference to one gender shall be
construed to include all other genders, including neuter, whenever the context
of this Guaranty so requires. Section captions or headings used in the Guaranty
are for convenience and reference only, and shall not affect the construction
thereof.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the undersigned has executed this Guaranty as of the
date first written above.
GUARANTOR:
TRANS HEALTHCARE, INC.
By:
------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------
Title: President
------------------------
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