SBA LOAN NUMBER
PLP 000-000-0000
EXHIBIT 10.7
SMALL BUSINESS ADMINISTRATION (SBA)
GUARANTY
November 29, 1996
In order to induce BANK OF ARIZONA, (hereinafter called "Lender") to
make a loan or loans, or renewal or extension thereof, to Xxxxx Engineered
Competition Components, Inc. (Hereinafter called "Debtor"), the Undersigned
hereby unconditionally guarantees to Lender, its successors and assigns, the due
and punctual payment when due, whether by acceleration or otherwise, in
accordance with the terms thereof, of the principal of and interest on and all
other sums payable, or stated to be payable, with respect to the note of the
Debtor, made by the Debtor to Lender, dated November 29, 1996 in the principal
amount of $762,720.00, with interest at the rate of (initial) 10.000 percent per
annum. Such note, and the interest thereon and all other sums payable with
respect thereto are hereinafter collectively called "Liabilities." As security
for the performance of this guaranty the Undersigned hereby mortgages, pledges,
assigns, transfers, and delivers to Lender certain collateral (if any), listed
in the schedule at the end hereof. The term "collateral" as used herein shall
mean any funds, guaranties, agreements, or other property or rights or interests
of any nature whatsoever, or the proceeds thereof, which may have been, are, or
hereafter may be, mortgaged, pledged, assigned, transferred or delivered
directly or indirectly by or on behalf of the Debtor of the Undersigned or any
other party to Lender or to the holder of the aforesaid note of the Debtor, or
which may have been, are, or hereafter may be held by any party as trustee or
otherwise, as security, whether immediate or underlying, for the performance of
this guaranty or the payment of the Liabilities or any of them or any security
therefor.
The Undersigned waives any notice of the incurring by the Debtor at any
time of any of the Liabilities, and waives any and all presentment, demand,
protest, or notice of dishonor, nonpayment, or other default with respect to any
of the Liabilities and any obligation of any party at any time comprised in the
collateral. The Undersigned hereby grants to Lender full power, in its
uncontrolled discretion and without notice to the Undersigned, but subject to
the provisions of any agreement between the Debtor or any other party and Lender
at the time in force, to deal in any manner with the Liabilities and the
collateral, including, but without limiting the generality of the foregoing, the
following powers:
(a) To modify or otherwise change any terms of all or any part of the
Liabilities or the rate of interest thereon (but not to increase the
principal amount of the note of the Debtor to Lender), to grant any
extension or renewal thereof and any other indulgence with respect
thereto, and to effect any release, compromise, or settlement with
respect thereto;
(b) To enter into any agreement of forbearance with respect to all or any
part of the Liabilities, or with respect to all or any part of the
collateral, and to change the terms of any such agreement;
(c) To forbear from calling for additional collateral to secure any of the
Liabilities or to secure any obligation comprised in the collateral;
(d) To consent to the substitution, exchange, or release of all or any
part of the collateral, whether or not the collateral, if any,
received by Lender upon any such substitution, exchange, or release
shall be of the same or of a different character or value than the
collateral surrendered by Lender;
(e) In the event of the nonpayment when due, whether by acceleration or
otherwise, of any of the Liabilities, or in the event of default in
the performance of any obligation comprised in the collateral, to
realize on the collateral or any part thereof, as a whole or in such
parcels or subdivided interests as Lender may elect, at any public or
private sale or sales, for cash or on credit or for future delivery,
without demand, advertisement, or notice of the time or place of sale
or any adjournment thereof (the Undersigned hereby waiving any such
demand, advertisement and notice to the extent permitted by law), or
by foreclosure or otherwise, or to forbear from realizing thereon, all
as Lender in its uncontrolled discretion may deem proper, and to
purchase all or any part of the collateral for its own account at any
such sale or foreclosure, such powers to be exercised only to the
extent permitted by law.
The obligations of the Undersigned hereunder shall not be released,
discharged or in any way affected, nor shall the Undersigned have any rights or
recourse against Lender, by reason of any action Lender may take or omit to take
under the foregoing powers.
In case the Debtor shall fail to pay all or any part of the Liabilities
when due, whether by acceleration or otherwise, according to the terms of said
note, the Undersigned, immediately upon the written demand of Lender, will pay
to Lender the amount due and unpaid by the Debtor as aforesaid, in like manner
as if such amount constituted the direct and primary obligation of the
Undersigned. Lender shall not be required, prior to any such demand on, or
payment by, the Undersigned, to make any demand upon or pursue or exhaust any of
its rights or remedies against the Debtor or others with respect to the payment
of any of the Liabilities, or to pursue or exhaust any of its rights or remedies
with respect to any part of the collateral. The Undersigned shall have no right
of subrogation whatsoever with respect to the Liabilities or the collateral
unless and until Lender shall have received full payment of all the Liabilities.
11-29-1996 SBA GUARANTY Page 2
Loan No 10024 (Continued)
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The obligations of the Undersigned hereunder, and the rights of Lender
in the collateral, shall not be released, discharged, or in any way affected,
nor shall the Undersigned have any rights against Lender; by reason of the fact
that any of the collateral may be in default at the time of acceptance thereof
by Lender or later; nor by reason of the fact that a valid lien in any of the
collateral may not be conveyed to, or created in favor of, Lender; nor by reason
of the fact that any of the collateral may be subject to equities or defenses or
claims in favor of others or may be invalid or defective in any way; nor by
reason of the fact that any of the Liabilities may be invalid for any reason
whatsoever; nor by reason of the fact that the value of any of the collateral,
or the financial condition of the Debtor or of any obligor under or guarantor of
any of the collateral, may not have been correctly estimated or may have changed
or may hereafter change; nor by reason of any deterioration, waste, or loss by
fire, theft, or otherwise of any of the collateral, unless such deterioration,
waste, or loss be caused by the willful act or willful failure to act of Lender.
The Undersigned agrees to furnish Lender, or the holder of the
aforesaid note of the Debtor, upon demand, but not more often than semiannually,
so long as any part of the indebtedness under such note remains unpaid, a
financial statement setting forth, in reasonable detail, the assets,
liabilities, and net worth of the Undersigned.
The Undersigned acknowledges and understands that if the Small Business
Administration (SBA) enters into, has entered into, or will enter into, a
Guaranty Agreement, with Lender or any other lending institution, guaranteeing a
portion of the Debtor's Liabilities, the undersigned agrees that it is not a
coguarantor with SBA and shall have no right of contribution against SBA. The
undersigned further agress that all liability hereunder shall continue
notwithstanding payment by SBA under its Guaranty Agreement to the other lending
institution.
The term "Undersigned" as used in this agreement shall mean the signer
or signers of this agreement, and such signers, if more than one, shall be
jointly and severally liable hereunder. The Undersigned further agrees that all
liability hereunder shall continue notwithstanding the incapacity, lack of
authority, death, or disability of any one or more of the Undersigned, and that
any failure by Lender or its assigns to file or enforce a claim against the
estate of any of the Undersigned shall not operate to release any other of the
Undersigned from liability hereunder. The failure of any other person to sign
this guaranty shall not release or affect the liability of any signer hereof.
The undersigned waives any rights it may have pursuant to Arizona
Revised Statutes Section 12-1641 et. seq., and agrees, pursuant to Arizona
Revised Statues Section 33-814, that the obligations of the undersigned may be
enforced regardless of whether any Trustee's sale of security for the debt
herein guaranteed is held or not.
THIS GUARANTY IS DATED NOVEMBER 29, 1996.
GUARANTOR:
Xxxxx Competition Components, Inc.
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President
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Note -- Corporate guarantors must execute guaranty in corporate name, by duly
authorized officer, and seal must be affixed and duly attested; partnership
guarantors must execute guaranty in firm name, together with signature of a
general partner. Formally executed guaranty is to be delivered at the time of
disbursement of loan.
(LIST COLLATERAL SECURING THE GUARANTY)
