GUARANTY
THIS GUARANTY, dated as of June 27, 1997, is made and given by XXXX
X. XXXXXXX, an individual (the "Guarantor"), in favor of First Bank National
Association, a National Banking Association (" Bank").
RECITALS
A. Bank has extended and/or may from time to time hereafter extend
credit accommodations to TECH SQUARED INC., a Minnesota corporation (the
"Borrower").
B. In connection with those credit accommodations Bank has
required that this Guaranty be executed and delivered by the Guarantor.
C. The Guarantor expects to derive benefits from the extension of
credit accommodations to the Borrower by Bank and finds it advantageous,
desirable and in its best interests to execute and deliver this Guaranty to
Republic.
NOW, THEREFORE, In consideration of the credit accommodations to be
extended to the Borrower and for other good and valuable consideration, the
Guarantor hereby covenants and agrees with Bank as follows:
Section 1. DEFINED TERMS. As used in this Guaranty, the following
terms shall have the meaning indicated:
"BORROWER" shall have the meaning indicated in Recital A.
"GUARANTOR" shall have the meaning indicated in the opening
paragraph hereof.
"OBLIGATIONS" shall mean any and all liabilities and obligations of
the Borrower to Bank of every kind, nature and description, whether direct or
indirect or hereafter acquired by Bank from any Person, absolute or
contingent, regardless of how such liabilities arise or by what agreement or
instrument they may be evidenced, in all cases whether due or to become due,
and whether now existing or hereafter arising or incurred.
"PERSON" shall mean any individual, corporation, partnership,
limited partnership, limited liability company, joint venture, firm,
association, trust, unincorporated organization, government or governmental
agency or political subdivision or any other entity, whether acting in an
individual, fiduciary or other capacity.
"REPUBLIC" shall have the meaning indicated in the opening
paragraph hereof.
Section 2. THE GUARANTY. The Guarantor hereby absolutely and
unconditionally guarantees to Bank the payment, which shall be limited to the
principal amount of $500,000 plus interest and costs as set forth herein,
when due (whether by demand, at a scheduled due date, or otherwise) and
performance of the Obligations.
Section 3. CONTINUING GUARANTY. This Guaranty is an absolute,
unconditional and continuing guaranty of payment and performance of the
Obligations, and the obligations of the Guarantor hereunder, which shall be
limited to the principal amount of $500,000 plus interest and costs as set
forth herein, shall not be released, in whole or in part, by any action or
thing which
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might, but for this provision of this Guaranty, be deemed a legal or
equitable discharge of a surety or guarantor, other than irrevocable payment
and performance in full of the Obligations. No notice of the Obligations to
which this Guaranty may apply, or of any renewal or extension thereof need be
given to the Guarantor and none of the foregoing acts shall release the
Guarantor from liability hereunder. The Guarantor hereby expressly waives
(a) demand of payment, presentment, protest, notice of dishonor, nonpayment
or nonperformance on any and all forms of the Obligations; (b) notice of
acceptance of this Guaranty and notice of any liability to which it may
apply; (c) all other notices and demands of any kind and description relating
to the Obligations now or hereafter provided for by any agreement, statute,
law, rule or regulation; and (d) any and all defenses of the Borrower
pertaining to the Obligations except for the defense of discharge by
payment. The Guarantor shall not be exonerated with respect to the
Guarantor's liabilities under this Guaranty by any act or thing except
irrevocable payment and performance of the Obligations, it being the purpose
and intent of this Guaranty that the Obligations constitute the direct and
primary obligations of the Guarantor and that the covenants, agreements and
all obligations of the Guarantor hereunder be absolute, unconditional and
irrevocable. The Guarantor shall be and remain liable up to a principal
amount of $500,000 plus interest and costs as set forth herein, for any
deficiency remaining after foreclosure of any mortgage, deed of trust or
security agreement securing all or any part of the Obligations, whether or
not the liability of the Borrower or any other Person for such deficiency is
discharged pursuant to statute, judicial decision or otherwise. The
acceptance of this Guaranty by Bank is not intended and does not release any
liability previously existing of any guarantor or surety of any indebtedness
of the Borrower to Republic.
Section 4. OTHER TRANSACTIONS. Bank is expressly authorized (a) to
exchange, surrender or release with or without consideration any or all
collateral and security which may at any time be placed with it by the
Borrower or by any other Person, or to forward or deliver any or all such
collateral and security directly to the Borrower for collection and
remittance or for credit, or to collect the same in any other manner without
notice to the Guarantor; and (b) to amend, modify, extend or supplement any
note or other instrument evidencing the Obligations or any part thereof and
any other agreement with respect to the Obligations, waive compliance by the
Borrower or any other Person with the respective terms thereof and settle or
compromise any of the Obligations without notice to the Guarantor and without
in any manner affecting the absolute liabilities of the Guarantor hereunder.
No invalidity, irregularity or unenforceability of all or any part of the
Obligations or of any security therefor or other recourse with respect
thereto shall affect, impair or be a defense to this Guaranty. The
liabilities of the Guarantor hereunder shall not be affected or impaired by
any failure, delay, neglect or omission on the part of Bank to realize upon
any of the Obligations of the Borrower to Republic, or upon any collateral or
security for any or all of the Obligations, nor by the taking by Bank of (or
the failure to take) any other guaranty or guaranties to secure the
Obligations, nor by the taking by Bank of (or the failure to take or the
failure to perfect its security interest in or other lien on) collateral or
security of any kind. No act or omission of Republic, whether or not such
action or failure to act varies or increases the risk of, or affects the
rights or remedies of the Guarantor, shall affect or impair the obligations
of the Guarantor hereunder. The Guarantor acknowledges that this Guaranty is
in effect and binding without reference to whether this Guaranty is signed by
any other Person or Persons, that possession of this Guaranty by Bank shall
be conclusive evidence of due delivery hereof by the Guarantor and that this
Guaranty shall continue in full force and effect, both as to the Obligations
then existing and/or thereafter created, notwithstanding the release of or
extension of time to any other guarantor of the Obligations or any part
thereof.
Section 5. ACTIONS NOT REQUIRED. The Guarantor hereby waives any
and all right to cause a marshalling of the assets of the Borrower or any
other action by any court or other governmental body with respect thereto or
to cause Bank to proceed against any security for the Obligations or any
other recourse which Bank may have with respect thereto and further waives
any and all requirements that Bank institute any action or proceeding at law
or in equity, or obtain any judgment, against the Borrower or any other
Person, or with respect to any collateral security
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for the Obligations, as a condition precedent to making demand on or
bringing an action or obtaining and/or enforcing a judgment against, the
Guarantor upon this Guaranty. The Guarantor further acknowledges that time
is of the essence with respect to the Guarantor's obligations under this
Guaranty. Any remedy or right hereby granted which shall be found to be
unenforceable as to any Person or under any circumstance, for any reason,
shall in no way limit or prevent the enforcement of such remedy or right as
to any other Person or circumstance, nor shall such unenforceability limit or
prevent enforcement of any other remedy or right hereby granted.
Section 6. NO SUBROGATION. Notwithstanding any payment or
payments made by the Guarantor hereunder, the Guarantor waives all rights of
subrogation to any of the rights of Bank against the Borrower or any other
Person liable for payment of any of the Obligations or any collateral
security or guaranty or right of offset held by Bank for the payment of the
Obligations, and the Guarantor waives all rights to seek any recourse to or
contribution or reimbursement from the Borrower or any other Person liable
for payment of any of the Obligations in respect of payments made by the
Guarantor hereunder, until such time that the Obligations are irrevocably
paid in full.
Section 7. APPLICATION OF PAYMENTS. Any and all payments upon the
Obligations made by the Guarantor or by any other Person, and/or the proceeds
of any or all collateral or security for any of the Obligations, may be
applied by Bank on such items of the Obligations as Bank may elect.
Section 8. RECOVERY OF PAYMENT. If any payment received by Bank
and applied to the Obligations is subsequently set aside, recovered,
rescinded or required to be returned for any reason (including, without
limitation, the bankruptcy, insolvency or reorganization of the Borrower or
any other obligor), the Obligations to which such payment was applied shall
for the purposes of this Guaranty be deemed to have continued in existence,
notwithstanding such application, and this Guaranty shall be enforceable as
to such Obligations as fully as if such application had never been made.
References in this Guaranty to amounts "irrevocably paid" or to "irrevocable
payment" refer to payments that cannot be set aside, recovered, rescinded or
required to be returned for any reason.
Section 9. BORROWER'S FINANCIAL CONDITION. The Guarantor is
familiar with the financial condition of the Borrower, and the Guarantor has
executed and delivered this Guaranty based on the Guarantor's own judgment
and not in reliance upon any statement or representation of Republic. Bank
shall have no obligation to provide the Guarantor with any advice whatsoever
or to inform the Guarantor at any time of Republic's actions, evaluations or
conclusions on the financial condition or any other matter concerning the
Borrower.
Section 10. REMEDIES. All remedies afforded to Bank by reason of
this Guaranty are separate and cumulative remedies and it is agreed that no
one of such remedies, whether or not exercised by Republic, shall be deemed
to be in exclusion of any of the other remedies available to Bank and no one
of such remedies shall in any way limit or prejudice any other legal or
equitable remedy which Bank may have hereunder and with respect to the
Obligations. Mere delay or failure to act shall not preclude the exercise or
enforcement of any rights and remedies available to Republic.
Section 11. BANKRUPTCY OF THE BORROWER. The Guarantor expressly
agrees that the liabilities and obligations of the Guarantor under this
Guaranty shall not in any way be impaired or otherwise affected by the
institution by or against the Borrower or any other Person of any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or any
other similar proceedings for relief under any bankruptcy law or similar law
for the relief of debtors and that any discharge of any of the Obligations
pursuant to any such bankruptcy or similar law or other law shall not
diminish, discharge or otherwise affect in any way the obligations of the
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Guarantor under this Guaranty, and that upon the institution of any of the
above actions, such obligations shall be enforceable against the Guarantor.
Section 12. COSTS AND EXPENSES. The Guarantor will pay or
reimburse Bank on demand for all out-of-pocket expenses (including in each
case all reasonable fees and expenses of counsel) incurred by Bank arising
out of or in connection with the enforcement of this Guaranty against the
Guarantor or arising out of or in connection with any failure of the
Guarantor to fully and timely perform the obligations of the Guarantor
hereunder.
Section 13. WAIVERS AND AMENDMENTS. This Guaranty can be waived,
modified, amended, terminated or discharged only explicitly in a writing
signed by Republic. A waiver so signed shall be effective only in the
specific instance and for the specific purpose given.
Section 14. NOTICES. Any notice or other communication to any
party in connection with this Guaranty shall be in writing and shall be sent
by manual delivery, telegram, telex, facsimile transmission, overnight
courier or United States mail (postage prepaid) addressed to such party at
the address specified on the signature page hereof, or at such other address
as such party shall have specified to the other party hereto in writing. All
periods of notice shall be measured from the date of delivery thereof if
manually delivered, from the date of sending thereof if sent by telegram,
telex or facsimile transmission, from the first business day after the date
of sending if sent by overnight courier, or from four days after the date of
mailing if mailed.
Section 15. GUARANTOR ACKNOWLEDGEMENTS. The Guarantor hereby
acknowledges that (a) counsel has advised the Guarantor in the negotiation,
execution and delivery of this Guaranty, (b)Bank has no fiduciary
relationship to the Guarantor, the relationship being solely that of debtor
and creditor, and (c) no joint venture exists between the Guarantor and
Republic.
Section 16. REPRESENTATIONS AND WARRANTIES. The Guarantor hereby
represents and warrants to Bank that:
16(a) It has the power and authority and the legal right to execute
and deliver, and to perform its obligations under, this Guaranty and has
taken all necessary action to authorize such execution, delivery and
performance.
16(b) 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 similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
16(c) The execution, delivery and performance of this Guaranty will
not (i) violate any provision of any law, statute, rule or regulation or
any order, writ, judgment, injunction, decree, determination or award of
any court, governmental agency or arbitrator presently in effect having
applicability to it, or (ii) result in a breach of or constitute a default
under any indenture, loan or credit agreement or any other agreement, lease
or instrument to which it is a party or by which it or any of its
properties may be bound or result in the creation of any lien thereunder.
It is not in default under or in violation of any such law, statute, rule
or regulation, order, writ, judgment, injunction, decree, determination or
award or any such indenture, loan or credit agreement or other agreement,
lease or instrument in any case in which the consequences of such default
or violation could have a material adverse effect on its business,
operations, properties, assets or condition (financial or otherwise).
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16(d) No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with, or exemption by,
any governmental or public body or authority is required on its part to
authorize, or is required in connection with the execution, delivery and
performance of, or the legality, validity, binding effect or enforceability
of, this Guaranty.
16(e) There are no actions, suits or proceedings pending or, to its
knowledge, threatened against or affecting it or any of its properties
before any court or arbitrator, or any governmental department, board,
agency or other instrumentality which, if determined adversely to it, would
have a material adverse effect on its business, operations, property or
condition (financial or otherwise) or on its ability to perform its
obligations hereunder.
16(f) It expects to derive benefits from the transactions resulting
in the creation of the Obligations. Bank may rely conclusively on the
continuing warranty, hereby made, that the Guarantor continues to be
benefitted by Republic's extension of credit accommodations to the Borrower
and Bank shall have no duty to inquire into or confirm the receipt of any
such benefits, and this Guaranty shall be effective and enforceable by Bank
without regard to the receipt, nature or value of any such benefits.
Section 17. CONTINUING GUARANTY. This Guaranty shall (a) remain
in full force and effect until irrevocable payment in full of the Obligations
and the expiration of the obligations, if any, of Bank to extend credit
accommodations to the Borrower, (b) be binding upon the Guarantor, its
successors and assigns and (c) inure to the benefit of, and be enforceable
by,Bank and its successors, transferees, and assigns.
Section 18. REAFFIRMATION. The Guarantor agrees that when so
requested by Bank from time to time it will promptly execute and deliver to
Bank a written reaffirmation of this Guaranty in such form as Bank may
require.
Section 19. FINANCIAL STATEMENTS, TAX RETURNS. The Guarantor
agrees that it will deliver to Bank copies of all state and federal tax
returns filed by the Guarantor, together with an updated personal financial
statement of the Guarantor in form and substance satisfactory to the Lender,
as may be required of the Borrower by Bank or as may otherwise be requested
of the Guarantor by Republic.
Section 20. REVOCATION. Notwithstanding any other provision
hereof, the Guarantor may revoke this Guaranty prospectively as to future
transactions by written notice to that effect actually received by Republic.
No such revocation shall release, impair or affect in any manner any
liability hereunder with respect to Obligations created, contracted, assumed
or incurred prior to receipt by Bank of written notice of revocation, or
Obligations created, contracted, assumed or incurred after receipt of such
notice pursuant to any contract entered into by Bank prior to receipt of such
notice, or any renewals or extensions thereof, theretofore or thereafter
made, or all other costs, expenses and attorneys' fees arising from such
Obligations.
Section 21. GOVERNING LAW AND CONSTRUCTION. THE VALIDITY,
CONSTRUCTION AND ENFORCEABILITY OF THIS GUARANTY SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS
PRINCIPLES THEREOF. Whenever possible, each provision of this Guaranty and
any other statement, instrument or transaction contemplated hereby or
relating hereto shall be interpreted in such manner as to be effective and
valid under such applicable law, but, if any provision of this Guaranty or
any other statement, instrument or transaction contemplated hereby or
relating hereto shall be held to be prohibited or invalid under such
applicable law, such provision shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining
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provisions of this Guaranty or any other statement, instrument or
transaction contemplated hereby or relating hereto.
Section 22. CONSENT TO JURISDICTION. AT THE OPTION OF REPUBLIC,
THIS GUARANTY MAY BE ENFORCED IN ANY FEDERAL COURT OR MINNESOTA STATE COURT
SITTING IN HENNEPIN COUNTY, MINNESOTA, MINNESOTA; AND THE GUARANTOR CONSENTS
TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT
VENUE IN SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT THE GUARANTOR COMMENCES
ANY ACTION IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY
ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS
GUARANTY,BANK AT ITS OPTION SHALL BE ENTITLED TO HAVE THE CASE TRANSFERRED TO
ONE OF THE JURISDICTIONS AND VENUES ABOVE-DESCRIBED, OR IF SUCH TRANSFER
CANNOT BE ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED
WITHOUT PREJUDICE.
Section 23. WAIVER OF JURY TRIAL. EACH OF THE GUARANTOR AND
REPUBLIC, BY ITS ACCEPTANCE OF THIS GUARANTY, IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 24. COUNTERPARTS. This Guaranty may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but
one and the same instrument.
Section 25. GENERAL. All representations and warranties contained
in this Guaranty or in any other agreement between the Guarantor and Bank
shall survive the execution, delivery and performance of this Guaranty and
the creation and payment of the Obligations. Captions in this Guaranty are
for reference and convenience only and shall not affect the interpretation or
meaning of any provision of this Guaranty.
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IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of
the date first above written.
GUARANTOR:
By
----------------------------
Xxxx X. Xxxxxxx
Address for Guarantor:
0000 Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxx 00000
Address for Bank:
FIRST BANK NATIONAL ASSOCIATION
0000 Xxxxxxx Xxxxxx XX,
Xxxxxxxxxxx, XX 00000
Fax: (000) 000-0000
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