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EXHIBIT 10.7.6
LIMITED GUARANTY
FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged,
the undersigned, XXXXXXX REALTY INVESTORS, INC. (whether one or more,
hereinafter together called "Guarantor" in the singular) absolutely guarantees
and agrees to pay to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA (hereinafter
called "Lender") at the address designated in the Instrument (as hereinafter
defined) for payment thereof or as such address may be changed as provided in
the Instrument, all limited and full recourse indebtedness of XXXXXXX PROPERTIES
RESIDENTIAL, L.P., a limited partnership organized under the laws of the State
of Georgia (hereinafter called "Borrower"), under Paragraphs 8 and 9 of that
certain Promissory Note, dated September 29, 1998 in the original principal
amount of Eleven Million Nine Hundred Thousand and 00/100 Dollars
($11,900,000.00), payable to the order of Lender, and all modifications,
renewals and extensions of and substitutions for said Promissory Note (said
Promissory Note and all modifications, renewals and extensions thereof and all
substitutions therefor hereinafter called the "Note"), together with all
interest, attorneys' fees and collection costs provided in the Note (all such
indebtedness is hereinafter called the "Indebtedness"), which Note is secured by
the Deed to Secure Debt and Security Agreement (hereinafter called the
"Instrument") of even date herewith from Borrower to Lender and to pay any and
all costs, attorneys' fees and expenses incurred or expended by Xxxxxx in
collecting any of the Indebtedness or in enforcing any right granted hereunder.
Except as otherwise limited as provided herein, in the event Borrower
fails to pay the Indebtedness, Guarantor shall immediately upon written demand
of Lender promptly and with due diligence pay for the benefit of Lender all of
the Indebtedness.
Guarantor expressly waives presentment for payment, demand, notice of
demand and of dishonor and nonpayment of the Indebtedness, notice of intention
to accelerate the maturity of the Indebtedness or any part thereof, notice of
disposition of collateral, notice of acceleration of the maturity of the
Indebtedness or any part thereof, protest and notice of protest, diligence in
collecting, and the bringing of suit against any other party. Lender shall be
under no obligation to notify Guarantor of its acceptance hereof or of any
advances made or credit extended on the faith hereof or the failure of Borrower
to pay any of the Indebtedness as it matures or any default in the performance
of any of the Obligations under the Instrument, or to use diligence in
preserving the liability of any person on the Indebtedness or the Obligations or
in bringing suit to enforce collection of the Indebtedness or performance of the
Obligations. Guarantor waives all defenses given to sureties or guarantors at
law or in equity other than the actual payment of the Indebtedness and
performance of the Obligations and all defenses based upon questions as to the
validity, legality or enforceability of the Indebtedness and/or the Obligations
and agrees that Guarantor shall be primarily liable hereunder.
Lender, without authorization from or notice to Guarantor and without
impairing, modifying, changing, releasing, limiting or affecting the liability
of Guarantor hereunder, may from time to time at its discretion and with or
without valuable consideration, alter, compromise, accelerate, renew, extend or
change the time or manner for the payment of any or all of the Indebtedness,
increase or reduce the rate of interest thereon, take and surrender security,
exchange security by way of substitution, or in any way it deems necessary take,
accept, withdraw, subordinate, alter, amend, modify or eliminate security, add
or release or discharge endorsers, guarantors or other obligors, make changes of
any sort whatever in the terms of payment of the Indebtedness, in the
Obligations or in the manner of doing business with Borrower, or settle or
compromise with Borrower or any other person or persons liable on the
Indebtedness or the Obligations on such terms as it may see fit, and may apply
all moneys received from the Borrower or others, or from any security held
(whether held under a security instrument or not),
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in such manner upon the Indebtedness (whether then due or not) as it may
determine to be in its best interest, without in any way being required to
marshal securities or assets or to apply all or any part of such moneys upon any
particular part of the Indebtedness. It is specifically agreed that Lender is
not required to retain, hold, protect, exercise due care with respect thereto,
perfect security interests in or otherwise assure or safeguard any security for
the Indebtedness; no failure by Xxxxxx to do any of the foregoing and no
exercise or nonexercise by Lender of any other right or remedy of Lender shall
in any way affect any of Guarantor's obligations hereunder or any security
furnished by Guarantor or give Guarantor any recourse against Lender.
The liability of Guarantor hereunder shall not be modified, changed,
released, limited or impaired in any manner whatsoever on account of any or all
of the following: (a) the incapacity, death, disability, dissolution or
termination of Guarantor, Borrower, Lender or any other person or entity; (b)
the failure by Lender to file or enforce a claim against the estate (either in
administration, bankruptcy or other proceeding) of Borrower or any other person
or entity; (c) recovery from Borrower or any other person or entity becomes
barred by any statute of limitations or is otherwise prevented; (d) any
defenses, set-offs or counterclaims which may be available to Borrower or any
other person or entity; (e) any transfer or transfers of any of the property
covered by the Instrument or any other instrument securing the payment of the
Note; (f) any modifications, extensions, amendments, consents, releases or
waivers with respect to the Note, the Deed to Secure Debt and Security
Agreement, any other instrument now or hereafter securing the payment of the
Note, or this Guaranty; (g) any failure of Lender to give any notice to
Guarantor of any default under the Note, the Deed to Secure Debt and Security
Agreement, any other instrument securing the payment of the Note, or this
Guaranty; (h) Guarantor is or becomes liable for any indebtedness owing by
Borrower to Lender other than under this Guaranty; or (i) any impairment,
modification, change, release or limitation of the liability of, or stay of
actions or lien enforcement proceedings against, Borrower, its property, or its
estate in bankruptcy resulting from the operation of any present or future
provision of the Federal Bankruptcy Code or any other present or future federal
or state insolvency, bankruptcy or similar law (all of the foregoing hereinafter
collectively called "applicable Bankruptcy Law") or from the decision of any
court.
Lender shall not be required to pursue any other remedies before
invoking the benefits of the guaranties contained herein, and specifically it
shall not be required to make demand upon or institute suit or otherwise pursue
or exhaust its remedies against Borrower or any surety other than Guarantor or
to proceed against any security now or hereafter existing for the payment of any
of the Indebtedness. Xxxxxx may maintain an action on this Guaranty without
joining Borrower therein and without bringing a separate action against
Borrower.
If for any reason whatsoever (including but not limited to ultra xxxxx,
lack of authority, illegality, force majeure, act of God or impossibility) the
Indebtedness or the Obligations cannot be enforced against Borrower, such
unenforceability shall in no manner affect the liability of Guarantor hereunder
and Guarantor shall be liable hereunder notwithstanding that Borrower may not be
liable for such Indebtedness or such Obligations and to the same extent as
Guarantor would have been liable if such Indebtedness or Obligations had been
enforceable against Borrower.
Guarantor absolutely and unconditionally covenants and agrees that in
the event that Borrower does not or is unable so to pay the Indebtedness or
perform the Obligations for any reason, including, without limitation,
liquidation, dissolution, receivership, conservatorship, insolvency, bankruptcy,
assignment for the benefit of creditors, sale of all or substantially all
assets, reorganization, arrangement, composition, or readjustment of, or other
similar proceedings affecting the status, composition, identity, existence,
assets or obligations of Borrower, or the disaffirmance or termination of any of
the Indebtedness or Obligations in or as a result of any such
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proceeding, Guarantor shall pay the Indebtedness and perform the Obligations and
no such occurrence shall in any way affect Guarantor's obligations hereunder.
Should the status of Borrower change, this Guaranty shall continue and
also cover the Indebtedness and Obligations of Borrower under the new status
according to the terms hereof. This Guaranty shall remain in full force and
effect notwithstanding any transfer of the property covered by the Instrument.
In the event any payment by Borrower to Lender is held to constitute a
preference under any applicable Bankruptcy Law, or if for any other reason
Lender is required to refund such payment or pay the amount thereof to any other
party, such payment by Borrower to Lender shall not constitute a release of
Guarantor from any liability hereunder, but Guarantor agrees to pay such amount
to Lender upon demand and this Guaranty shall continue to be effective or shall
be reinstated, as the case may be, to the extent of any such payment or
payments.
Guarantor agrees that it shall not have (a) the right to the benefit
of, or to direct the application of, any security held by Xxxxxx (including the
property covered by the Deed to Secure Debt and Security Agreement and any other
instrument securing the payment of the Note), any right to enforce any remedy
which Lender now has or hereafter may have against Borrower, or any right to
participate in any security now or hereafter held by Lender, or (b) any defense
arising out of the absence, impairment or loss of any right of reimbursement or
subrogation or other right or remedy of Guarantor against Borrower or against
any security resulting from the exercise or election of any remedies by Xxxxxx
(including the exercise of the power of sale under the Instrument), or any
defense arising by reason of any disability or other defense of Borrower or by
reason of the cessation, from any cause, of the liability of Borrower.
The payment by Guarantor of any amount pursuant to this Guaranty shall
not in any way entitle Guarantor to any right, title or interest (whether by way
of subrogation or otherwise) in and to any of the Indebtedness or any proceeds
thereof, or any security therefor, unless and until the full amount owing to
Lender on the Indebtedness has been fully paid, but when the same has been fully
paid Guarantor shall be subrogated as to any payments made by it to the rights
of Xxxxxx as against Borrower and/or any endorsers, sureties or other
guarantors.
Notwithstanding any payments made by or for the account of Guarantor on
account of the Indebtedness, Guarantor shall not be subrogated to any rights of
Lender until such time as Lender shall have received payment of the full amount
of all Indebtedness. For the purposes of the preceding sentence only, the
Indebtedness shall not be deemed to have been paid in full by foreclosure of the
Instrument or by acceptance of a deed in lieu thereof, and Guarantor hereby
waives and disclaims any interest which it might have in the property covered by
the Instrument or other collateral security for the Indebtedness, by subrogation
or otherwise, following foreclosure of the Instrument or Lender's acceptance of
a deed in lieu thereof.
Guarantor expressly subordinates its rights to payment of any
indebtedness owing from Borrower to Guarantor, whether now existing or arising
at any time in the future, to the prior right of Lender to receive or require
payment in full of the Indebtedness and until payment in full of the
Indebtedness (and including interest accruing on the Note after any petition
under applicable Bankruptcy Law, which post-petition interest Guarantor agrees
shall remain a claim that is prior and superior to any claim of Guarantor
notwithstanding any contrary practice, custom or ruling in proceedings under
such applicable Bankruptcy Law generally), Guarantor agrees not to accept any
payment or satisfaction of any kind of indebtedness of Borrower to Guarantor or
any security for such indebtedness. If Guarantor should receive any such
payment, satisfaction or security for any indebtedness of Borrower to Guarantor,
Guarantor agrees forthwith to deliver the same to Lender in the form
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received, endorsed or assigned as may be appropriate for application on account
of, or as security for, the Indebtedness and until so delivered, agrees to hold
the same in trust for Xxxxxx.
Under no circumstances shall the aggregate amount paid or agreed to be
paid hereunder exceed the highest lawful rate permitted under applicable usury
law (the "Maximum Rate") and the payment obligations of Guarantor hereunder are
hereby limited accordingly. If under any circumstances, whether by reason of
advancement or acceleration of the unpaid principal balance of the Note or
otherwise, the aggregate amounts paid hereunder shall include amounts which by
law are deemed interest and which could exceed the Maximum Rate, Guarantor
stipulates that payment and collection of such excess amounts shall have been
and will be deemed to have been the result of a mistake on the part of both
Guarantor and Lender, and Lender shall promptly credit such excess (to the
extent only of such interest payments in excess of the Maximum Rate) against the
unpaid principal balance of the Note, and any portion of such excess payments
not capable of being so credited shall be refunded to Guarantor. The term
"applicable law" as used in this paragraph shall mean the laws of the State of
Georgia or the laws of the United States, whichever laws allow the greater rate
of interest, as such laws now exist or may be changed or amended or come into
effect in the future.
Guarantor hereby represents, warrants and covenants to and with Lender
as follows: (a) the making of the Loan by Xxxxxx to Borrower is and will be of
direct interest, benefit and advantage to Guarantor; (b) Guarantor is solvent,
is not bankrupt and has no outstanding liens, garnishments, bankruptcies or
court actions which could render Guarantor insolvent or bankrupt, and there has
not been filed by or against Guarantor a petition in bankruptcy or a petition or
answer seeking an assignment for the benefit of creditors, the appointment of a
receiver, trustee, custodian or liquidator with respect to Guarantor or any
substantial portion of Guarantor's property, reorganization, arrangement,
rearrangement, composition, extension, liquidation or dissolution or similar
relief under applicable Bankruptcy Law; (c) all reports, financial statements
and other financial and other data which have been or may hereafter be furnished
by Guarantor to Lender in connection with this Guaranty are or shall be true and
correct in all material respects and do not and will not omit to state any fact
or circumstance necessary to make the statements contained therein not
misleading and do or shall fairly represent the financial condition of Guarantor
as of the dates and the results of Guarantor's operations for the periods for
which the same are furnished, and no material adverse change has occurred since
the dates of such reports, statements and other data in the financial condition
of Guarantor; (d) the execution, delivery and performance of this Guaranty do
not contravene, result in the breach of or constitute a default under any
mortgage, deed of trust, lease, promissory note, loan agreement or other
contract or agreement to which Guarantor is a party or by which Guarantor or any
of its properties may be bound or affected and do not violate or contravene any
law, order, decree, rule or regulation to which Guarantor is subject; (e) there
are no judicial or administrative actions, suits or proceedings pending or, to
the best of Guarantor's knowledge, threatened against or affecting Guarantor or
involving the validity, enforceability or priority of this Guaranty; and (f)
this Guaranty constitutes the legal, valid and binding obligation of Guarantor
enforceable in accordance with its terms.
Guarantor will deliver to Lender within sixty (60) days after each Note
anniversary date financial statements of Guarantor in scope and detail
satisfactory to Lender. The statements shall be sworn and certified as to
accuracy by Guarantor.
Where two or more persons or entities have executed this Guaranty,
unless the context clearly indicates otherwise, all references herein to
"Guarantor" shall mean the guarantors hereunder or either or any of them. All of
the obligations and liability of said guarantors hereunder shall be joint and
several. Suit may be brought against said guarantors, jointly and severally, or
against any one or more of them, less than all, without impairing the rights of
Lender against the other or others of said guarantors; and Lender may compound
with any one or
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more of said guarantors for such sums or sum as it may see fit and/or release
such of said guarantors from all further liability to Lender for such
indebtedness without impairing the right of Lender to demand and collect the
balance of such indebtedness from the other or others of said guarantors not so
compounded with or released; but it is agreed among said guarantors themselves,
however, that such compounding and release shall in nowise impair the rights of
said guarantors as among themselves.
Except as otherwise provided herein, the rights of Lender are
cumulative and shall not be exhausted by its exercise of any of its rights
hereunder or otherwise against Guarantor or by any number of successive actions
until and unless all Indebtedness has been paid and each of the obligations of
Guarantor hereunder has been performed.
All property of Guarantor now or hereafter in the possession or custody
of or in transit to Lender for any purpose, including safekeeping, collection or
pledge, for the account of Guarantor, or as to which Guarantor may have any
right or power, shall be held by Lender subject to a lien and security interest
in favor of Lender to secure payment and performance of all obligations and
liabilities of Guarantor to Lender hereunder. Guarantor hereby transfers and
conveys to Lender any and all balances, credits, deposits, accounts, items and
moneys of Guarantor now or hereafter in the possession or control of or
otherwise with Lender. Lender is hereby granted a first lien upon, and security
interest in, all property of Guarantor of every kind or description now or
hereafter in possession or control of Lender for any purpose, including all
dividends and distributions on or other rights in connection therewith. The
balance of every account of Guarantor with, and each claim of Guarantor against,
Lender existing from time to time shall be subject to a lien and subject to set
off against any and all liabilities of Guarantor to Lender, and Lender may, at
any time and from time to time at its option and without notice, appropriate and
apply toward the payment of any of such liabilities the balance of each such
account or claim of Guarantor against Lender.
Any notice or communication required or permitted hereunder shall be
given in writing, sent by (a) personal delivery, or (b) expedited delivery
service with proof of delivery, or (c) United States mail, postage prepaid,
registered or certified mail, or (d) prepaid telegram, telex or telecopy, sent
to the intended addressee at the address shown below, or to such other address
or to the attention of such other person as hereafter shall be designated in
writing by the applicable party sent in accordance herewith. Any such notice or
communication shall be deemed to have been given and received either at the time
of personal delivery or, in the case of delivery service or mail, as of the date
of first attempted delivery at the address and in the manner provided herein, or
in the case of telegram, telex or telecopy, upon receipt.
This Guaranty shall be deemed to have been made under and shall be
governed by the laws of the State of Georgia in all respects.
This Guaranty may be executed in any number of counterparts with the
same effect as if all parties hereto had signed the same document. All such
counterparts shall be construed together and shall constitute one instrument,
but in making proof hereof it shall only be necessary to produce one such
counterpart.
This Guaranty may only be modified, waived, altered or amended by a
written instrument or instruments executed by the party against which
enforcement of said action is asserted. Any alleged modification, waiver,
alteration or amendment which is not so documented shall not be effective as to
any party.
The books and records of Xxxxxx showing the accounts between Xxxxxx and
Xxxxxxxx shall be admissible in any action or proceeding hereon as prima facie
evidence of the items set forth herein.
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Guarantor waives and renounces any and all homestead or exemption
rights Guarantor may have under the Constitution or the laws of any state as
against this Guarantor, and does transfer, convey and assign to Lender a
sufficient amount of such homestead or exemption as may be allowed, including
such homestead or exemption as may be set apart in bankruptcy, to pay and
perform the Indebtedness and Obligations. Guarantor hereby directs any trustee
in bankruptcy having possession of such homestead or exemption to deliver to
Lender a sufficient amount of property or money set apart as exempt to pay and
perform the Indebtedness and Obligations.
The terms, provisions, covenants and conditions hereof shall be binding
upon Guarantor and the heirs, devisees, representatives, successors and assigns
of Guarantor and shall inure to the benefit of Lender and all transferees,
credit participants, successors, assignees and/or endorsees of Lender. Within
this Guaranty, words of any gender shall be held and construed to include any
other gender and words in the singular number shall be held and construed to
include the plural and words in the plural number shall be held and construed to
include the singular, unless the context otherwise requires. A determination
that any provision of this Guaranty is unenforceable or invalid shall not affect
the enforceability or validity of any other provision and any determination that
the application of any provision of this Guaranty to any person or circumstance
is illegal or unenforceable shall not affect the enforceability or validity of
such provision as it may apply to any other persons or circumstances.
EXECUTED this 29th day of September, 1998.
XXXXXXX REALTY INVESTORS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: President
Attest: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Chief Financial Officer
[CORPORATE SEAL]
The address of Guarantor is:
Xxxxxxx Realty Investors, Inc.
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: President
The address of Lender is:
The Prudential Insurance Company of America
Prudential Capital Group
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: Regional Counsel
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