GUARANTY AGREEMENT
In consideration of the sum of Ten and No/100 Dollars ($10.00) and
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged by the undersigned, and the agreement of SENTINEL TRUST
COMPANY, a Tennessee trust company having its principal trust office at 0000
Xxxxxx Xxxxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx 00000-0000 (hereinafter
referred to as "Trustee"), to act as Trustee under that certain Trust
Indenture, dated as of December 1, 1997, between Development Authority of
Rockdale County (the "Issuer") and the Trustee (the "Indenture") for the
$8,500,000 Development Authority of Rockdale County First Mortgage Revenue
Bonds (Conyers Retirement, L.P. Project), Convertible Series 1997A (the
"Series 1997A Bonds") and $500,000 Development Authority of Rockdale County
First Mortgage Revenue Bonds (Conyers Retirement, L.P. Project), Taxable
Series 1997B (the "Series 1997B Bonds") (the Series 1997A Bonds and Series
1997B Bonds are referred to hereinafter collectively as
the "Series 1997 Bonds") for the benefit of Conyers Retirement, L.P., a Georgia
limited partnership (the "Borrower"), the undersigned, NewCare Health
Corporation, a Nevada corporation authorized to do business in the State of
Georgia (the "Guarantor") unconditionally and irrevocably guarantees to the
Issuer and to the Trustee the prompt payment and performance according to
their terms of all of the Obligations (as herein defined) and does agree that if
the Obligations will immediately do so. This instrument is hereinafter
referred to as the "guaranty."
The term "Obligations" as used herein means all obligations of the
Borrower to Issuer and Trustee now existing or hereafter coming into existence,
whether now or hereafter owned by Issuer or Trustee, including without
limitation any and all (i) obligations of the Borrower arising from, by
reason of, or in any way relating to the Loan Agreement (the "Agreement"),
dated as of December 1, 1997, between Issuer and Borrower, or any of the
other financing documents as referred to in the Agreement, including, but
not limited to, the indemnification provision of Section 5.2 of the
Agreement, together with any and all reasonable costs or
expenses (including, without limitation, attorneys' fees and expenses)
which may be paid or incurred by the Issuer, the Trustee or the Bondholders
(defined in the Indenture) in pursuing the remedies under the Indenture or
in collecting any or all of the foregoing, (ii) obligations of the Borrower
to Issuer or Trustee
arising from, by reason of, or in any way relating to any other loan
agreement,
security agreement, security deed, other security instrument, or any
promissory
note executed by (whether alone or together with another or others) in
favor of
Issuer or Trustee or any loan or advance by Issuer or Trustee to the
Borrower
under or in connection with any of the foregoing, (ii) other indebtedness
now or
hereafter owing by the Borrower to Issuer or Trustee, however evidenced or
created, whether direct, indirect or by way of assignment, whether joint or
several, absolute or contingent, or due or to become due, and (iv)
renewals,
extensions or modifications, in whole or in part, of any of the foregoing.
This guaranty shall be effective regardless of the solvency or
insolvency of the Borrower, the dissolution of the Borrower, the institution
by or against
the Borrower of any proceeding under the Federal Bankruptcy Code, any
reorganization, merger or consolidation of the Borrower, or any change in
the ownership, composition or nature of the Borrower.
In the event any proceeding is instituted by or against the Borrower
under
the Federal Bankruptcy Code or any other bankruptcy, insolvency or
moratorium
law, as between the undersigned and Issuer or Trustee, all of the
obligations
shall be immediately due and payable, without notice or demand of any kind,
and
the undersigned agrees immediately to pay the Obligations in full,
irrespective
of whether the Obligations can be accelerated against the Borrower and
irrespective of any right which the Borrower may have under any bankruptcy,
insolvency or moratorium law to cure defaults and reinstate the maturities
of the Obligations.
The undersigned hereby consents and agrees that Issuer or Trustee may
at
any time, either with or without consideration, surrender any property or
other
security of any kind or nature whatsoever held by it, or by any person,
firm or
corporation on its behalf or for its account, securing any of the
Obligations or
substitute any collateral so held by it for other collateral of like kind
or of
any kind without notice to or further consent from the undersigned, and
such
surrender or substitution shall not in any way affect the liability of the
undersigned hereunder.
Payment by the Guarantor under this guaranty shall be due and payable
upon
notice ("Notice of Nonpayment") from the Trustee, by telex, fax or
telegram, that
the Borrower has failed to deposit the funds required for payment of
principal,
interest, or premium, if any, due and payable on the Bonds in accordance
with the Agreement.
The Guarantor covenants that so long as the guaranty is in effect, it
will
maintain its existence and will not merge or consolidate with any other
corporation or sell or otherwise dispose of all or substantially all of its
assets; provided that the Guarantor may, subject to the approval of the
Issuer,
merger or consolidate with another corporation or other business entity all
or
substantially all of its assets as an entirety and thereafter dissolve,
provided
any surviving, resulting or transferee entity (i) is authorized to do
business
in the State of Georgia, (ii) is a domestic corporation, partnership or
other
entity, or, if a natural person, is a resident of the United States of
America,
(iii) assumes in writing all of the obligations of the Guarantor under this
guaranty and (iv) has net worth (as certified by a certified public
accountant
after giving effect to such transaction) at least equal to that of the
Guarantor
immediately prior to such transaction; and provided further that the
Guarantor
may merge other entities into it without the consent of the Issuer so long
as
requirements (I), (ii) and (iv) above of this paragraph are satisfied.
Failure by Issuer or Trustee to give the undersigned (i) notice of the
creation of any of the Obligations, (ii) notice of nonpayment or default by
the
Borrower under any of the Obligations or under any agreement now or
hereafter
existing between Issuer or Trustee and the Borrower, (iii) notice of
presentment,
(iv) demand, (v) notice of dishonor , (vi) protest, (vii) notice of
acceptance
of this guaranty or of the creation or extension or renewal of any
Obligation,
or (viii) any other notice whatsoever shall not affect or impair, or
release the
undersigned from its liability under, this guaranty. The undersigned
further
agrees that no modification of any of the Obligations, and that no waiver,
extension, renewal, indulgence, settlement, compromise or failure to
exercise due
diligence in collection, for any period or periods, whether or not longer
than
the original period, or any substitution or release of any other person
directly
or indirectly liable for any of the obligations, including without
limitation any
other guarantor of the Obligations, shall affect or impair, or release the
undersigned for its liability under, this guaranty.
Guarantor acknowledges that the Trustee is not required, as a
precondition
to the enforcement of this guaranty, to seek payment of the Obligations
from any
other elements of security described in the Indenture and/or the Agreement,
and
that the Trustee may satisfy the payment of the Obligations directly from
the
Guarantor pursuant to the terms of this guaranty in the event of
non-payment by the Borrower of such Obligations.
This guaranty is absolute and unconditional and irrevocable and shall
remain in full force and effect until such time as all of the Obligations
have
been paid or performed in full, and this guaranty is binding upon the
Guarantor and its successors and assigns.
The obligations of Guarantor hereunder shall be absolute,
unconditional,
and irrevocable without regard to the validity, legality or enforceability
of the
Agreement, the Indenture, the Series 1997 Bonds or any other instrument
delivered
under or in connection with any of the foregoing, or any other
circumstances
which might otherwise constitute a legal or equitable discharge of a surety
or
guarantor, it being agreed that the obligations of Guarantor hereunder
shall not
be discharged except by final payment in full as herein provided or
fulfillment of all of the Obligations.
In the event any claim hereunder is referred to an attorney-at-law for
collection, the undersigned shall be liable to Issuer and Trustee for all
costs
of collection including reasonable attorneys' fees actually incurred.
The undersigned agrees that no act or omission on the part of Issuer
or Trustee shall in any way affect or impair this guaranty.
The liability of the undersigned hereunder is primary, and Issuer or
Trustee may proceed against the undersigned hereunder without first
proceeding
against the Borrower, or any other person (including, without limitation
and
other guarantor of the Obligations) primarily or secondarily liable on any
of the
Obligations, or any collateral securing any of the Obligations.
Whenever Issuer or Trustee in good faith believes that the prospect of
payment of any of the Obligations is impaired, Issuer or Trustee, without
notice
or demand of any kind, may hold and set off against such Obligations
(whether
matured or unmatured) as Issuer and Trustee may elect, any balance or
amount to
the credit of the undersigned in any deposit, agency, reserve, holdback or
other
account of any nature whatsoever maintained by or on behalf of the
undersigned
with Issuer or Trustee at any of their offices, regardless of whether such
accounts are individual or joint.
Guarantor hereby assents to all of the terms of the Agreement, the
Indenture and the Bonds and hereby waivers the right to require application
in
respect of the property of the Borrower and waives any right to require
that any
resort be had by the Trustee to any security held for payment of the
Obligations
or to any balance of any deposit account or credit on the books of the
Trustee
in favor of the Borrower or any other person; and waives notice of
acceptance of
its guarantee hereunder, presentment, demand, protest, notice of the
occurrence
of an event of default under the Agreement, the Indenture or the Bonds or
any or
all of the Obligations, other than notice of nonpayment, and promptness in
making
any claim or demand hereunder, it being the intention of Guarantor that no
act
or omission of any kind shall in any way affect or impair its guarantee or
its payment obligations.
This guaranty is subject to all the terms, conditions, agreement, and
stipulations contained in any agreements, deeds, notes, instruments or
other
documents evidencing the Obligations, and the undersigned agrees that the
terms,
conditions and provisions of such agreements, deeds, notes, instruments or
other
documents shall, simultaneously with their execution, become a part of this
guaranty.
Guarantor will not exercise any rights which it may have acquired by
way
of subrogation under this guaranty, by any payment made hereunder or
otherwise, unless and until all the Obligations shall have been paid in
full, and if any
payment shall be made to Guarantor on account of such subrogation rights at
any
time when all the Obligations shall not have been paid in full, each and
every
amount so paid will be forthwith paid to the Trustee to be credited and
applied
to any of the Obligations, whether matured or unmatured, in accordance with
the terms of the Indenture.
This guaranty is a continuing guarantee of payment and not of
collection
and (i) shall remain in full force and effect until payment of the
Obligations,
(ii) shall be binding upon Guarantor, its successors and assigns, but
Guarantor
may not assign or transfer its rights or obligations hereunder and (iii)
shall
inure to the benefit of, and be enforceable by, the Issuer, the Trustee and
their
respective successors and assigns under the Indenture and the Agreement,
and the
registered Bondholders (defined in the Indenture) in accordance with the
provisions of the Indenture.
Each payment by the Guarantor hereunder shall reduce pro tanto the
Obligations which the Guarantor is obliged to pay hereunder.
Notwithstanding
anything to the contrary, any payment by the Borrower of principal of, any
premium, if any, or interest on the Bonds (which payment shall not be the
subject
of a claim or dispute by any third party) shall eliminate a corresponding
obligation of the Guarantor to make the same payment.
If at any time any provision hereof is or becomes invalid, illegal or
unenforceable in any respect under the law of any jurisdiction, neither the
validity, legality or enforceability of such provision under the law of any
other
jurisdiction shall in any way be affected or impaired thereby.
This guaranty and all instruments delivered hereunder shall be
construed
and governed in accordance with the laws of the State of Georgia. Guarantor
hereby (a) consents and submits to the nonexclusive jurisdiction of, and
consents
to any suit, legal action or proceedings with respect to this guaranty
being, at
the option of the Issuer or the Trustee, brought by the Issuer or the
Trustee in
any state or federal court sitting in the State of Georgia; and (b)
consents to
any such suit, legal action or proceeding being brought in the courts of
whatever
jurisdiction the Issuer may select to execute or otherwise to enforce any
judgment for beach of this guaranty obtained against Guarantor or any of
its undertakings, property or assets.
The obligations of the Guarantor set forth in this guaranty shall
terminate, and this guaranty shall be of no further force or effect upon
final
payment in full as herein provided or fulfillment of all of the
Obligations.
This guaranty shall cover all Obligations to Issuer or Trustee
purporting
to be made on behalf of the Borrower by any officer or agent of the
Borrower
without regard to the actual authority of such officer or agent or whether
or not
the Borrower is legally or properly organized.
The words "Issuer" or "Trustee" as herein used shall include
transferees,
assigns and successors of Issuer or Trustee, and all rights of Issuer and
Trustee
hereunder shall inure to the benefit of their respective transferees,
successors and assigns.
Words importing the singular number hereunder shall include the plural
number and vice versa, and any pronouns used herein shall be deemed to
cover all
genders. The term "person" as used herein means any individual,
corporation,
partnership, joint venture, association, joint-stock company, trust,
unincorporated association or government or any agency or political
subdivision
thereof.
Wherever possible, each provision of this guaranty shall be
interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this guaranty shall be prohibited by or invalid under
applicable
law, such provision shall be ineffective only the extent of such
prohibition or
invalidity, without invalidating the remainder of such provisions or the
remaining of this guaranty.
SIGNED, SEALED AND DELIVERED as of the 1st day of December, 1997.
NEWCARE HEALTH CORPORATION
By: /s/ Xxxxx Xxxxx
President
Attest: Xxxxxx X. Xxxx
Secretary
