EXHIBIT 10.25
GUARANTY AND SUBORDINATION AGREEMENT
FORM OF GUARANTY OF XXXXXXXXX LEASE
THIS GUARANTY AND SUBORDINATION AGREEMENT (this "Agreement"), made as
of the 21st day of November 1997, by Geneva Enterprises, Inc., a Delaware
corporation ("Guarantor"), in favor of Capital Automotive, L.P., a Delaware
limited partnership ("Landlord").
WITNESSETH:
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WHEREAS, Landlord has this day entered into a lease (the "Lease") of
certain Properties identified on Schedule A hereto (individually a "Property"
and collectively the "Properties") with Maryland Imported Cars, Inc. d/b/a
Gaithersburg Mazda ("Tenant"), this Agreement being attached to the Lease;
WHEREAS, Tenant is an affiliate of Guarantor; and
WHEREAS, Landlord has required, as a condition to entering into the
Lease, Guarantor to be a guarantor of each and every obligation imposed upon
Tenant by the Lease.
NOW, THEREFORE, to induce Landlord to enter into the Lease and in
consideration of the foregoing premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Guarantor, for itself, its successors and assigns, hereby covenants and agrees
for the benefit of Landlord, as follows:
1. Guaranty. Guarantor does hereby unconditionally and irrevocably
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guarantee to Landlord the full, complete and timely performance of all
obligations imposed on Tenant by the terms of the Lease, including, but not
limited to, the full, complete and timely payment of rent and all other sums due
by Tenant under the Lease, and the payment as required by the Lease of all
damages to Landlord which may result from Tenant's breach of any provision of
the Lease, including, but not limited to, those relating to damage to any
Property or the leased premises.
2. Guaranty of Payment and Performance. Guarantor acknowledges and
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agrees that this is a guaranty of payment and performance and not mere
collection. The liability of Guarantor under this Agreement shall be direct and
immediate and not conditional or contingent upon the pursuit of any remedies
against Tenant or any other person or entity. Guarantor waives any right to
require that an action be brought against Tenant or any other person or entity.
In the event, on account of the Bankruptcy Reform Act of 1978, as amended, or
any other debtor relief law (whether statutory, common law, case law or
otherwise) of any jurisdiction whatsoever, now or hereafter in effect, which may
be or become applicable, Tenant
shall be relieved of the Lease or any debt, obligation or liability as provided
in the Lease, Guarantor shall nevertheless be fully liable for the complete and
timely performance of all obligations imposed on Tenant by the Lease throughout
the entire term of the Lease, all to the same extent as if Guarantor had been
the original tenant thereunder and the Lease shall be deemed unaffected by any
such relief granted to Tenant. In the event of a default under the Lease which
is not cured within any applicable grace or cure period, Landlord shall have the
right to enforce its rights, powers and remedies thereunder or hereunder, in any
order to the maximum extent permitted by law, and all rights, powers and
remedies provided thereunder or hereunder or by law or in equity. If the
obligations guaranteed hereby are partially performed, paid or discharged by
reason of the exercise of any of the remedies available to Landlord, this
Agreement shall nevertheless remain in full force and effect, and Guarantor
shall continue to be liable for all remaining obligations guaranteed hereby,
even though any rights which Guarantor may have against Tenant may be destroyed
or dismissed by the exercise of any such remedy.
3. Waivers by Guarantor. To the extent permitted by law, Guarantor
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hereby waives and agrees not to assert or take advantage of:
(a) Any right to require Landlord to proceed against Tenant or
any other person or entity or to proceed against or exhaust any security held by
Landlord at any time or to pursue any other remedy in Landlord's power or under
any other agreement before proceeding against Guarantor;
(b) Any defense that may arise by reason of the incapacity, lack
of authority, death or disability of any other person or persons or the failure
of Landlord to file or enforce a claim against the estate (in administration,
bankruptcy or any other proceeding) of any other person or persons:
(c) Any defense based upon an election of remedies by Landlord;
(d) Any right or claim or right to cause a marshaling of the
assets of Tenant or Guarantor;
(e) Any invalidity, irregularity or unenforceability, in whole
or in part, of any one or more provisions of the Lease;
(f) Any modification of the Lease or of any obligation of Tenant
thereunder by amendments to the Lease, by waivers granted by Landlord or by
operation of law or by action of any court, whether pursuant to the Bankruptcy
Reform Act of 1978, as amended, or any other debtor relief law (whether
statutory, common law, case law or otherwise) of any jurisdiction whatsoever,
now or hereafter in effect, or otherwise.
4. Subordination. Guarantor and those parties signing below for the
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purpose of being bound by this Section 4 (collectively, "Section 4 Signers")
hereby unconditionally and irrevocably subordinate (i) all payments due or to
become due by Tenant to the Section 4 Signers, or any of them, by reason of any
and all debts or other obligations, including the obligation to pay salaries or
other compensation (collectively "Debt Payments") and (ii) the receipt of all
dividends or other distributions of any kind or nature (collectively,
"Distributions")
to the payment of all sums due or to become due by Tenant to Landlord under the
Lease, including the payment of Rent and all damages due by reason of Tenant's
breach of the Lease; provided, however, that for so long as there shall be no
existing Event of Default under the Lease, after the payment of each monthly
installment of Rent, the Section 4 Signers shall be entitled to receive Debt
Payments due for such month.
5. General Provisions.
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(a) Survival. This Agreement shall be deemed to be continuing
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in nature and shall remain in full force and effect and shall survive the
exercise of any remedy by Landlord under the Lease;
(b) No Subrogation; No Recourse Against Landlord.
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Notwithstanding the satisfaction by Guarantor of any liability hereunder,
Guarantor's rights of subrogation, contribution, reimbursement or indemnity, if
any, or any right of recourse to or with respect to the assets or property of
Tenant, shall be subject and subordinate to the rights of Landlord. Guarantor
expressly agrees not to exercise any and all rights of subrogation against
Landlord.
(c) Entire Agreement; Amendment; Severability. This Agreement
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contains the entire agreement between the parties respecting the matters herein
set forth and supersedes all prior agreements, whether written or oral, between
the parties respecting such matters. Any amendments or modifications hereto, in
order to be effective, shall be in writing and executed by Landlord and
Guarantor. A determination that any provision of this Agreement 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
Agreement 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.
(d) Governing Law: Binding Effect; Waiver of Acceptance. This
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Agreement shall be governed by and construed in accordance with the laws of the
State of Virginia without regard to conflicts of laws principles thereof. This
Agreement shall bind Guarantor, it successors and assigns (but in the event of
an assignment, Guarantor shall not be relieved of its obligations hereunder),
and shall inure to the benefit of Landlord, its successors and assigns.
Guarantor hereby waives any acceptance of this Agreement by Landlord and this
Agreement shall immediately be binding upon Guarantor.
(e) Notice. All notices, demands, requests or other
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communications to be sent by one party to the other hereunder or required by law
shall be in writing and shall be deemed to have been validly given or served by
delivery of the same in person to the intended addressee, or certified mail or
by depositing the same with Federal Express or another reputable private courier
service for next business day delivery to the intended addressee at its address
set forth in the last section of this Agreement or at such other address as may
be designated by such party as herein provided. All notices, demands and
requests shall be effective upon such personal delivery, or one (1) business day
after being deposited with the private courier service, or two (2) business days
after being deposited in the United States mail as required above.
Rejection or other refusal to accept or the inability to deliver because of
changed address of which no notice was given as herein required shall be deemed
to be receipt of the notice, demand or request sent. By giving to the other
party hereto at least seven (7) days' prior written notice thereof in accordance
with the provisions hereof, each party shall have the right from time to time to
change their respective addresses and each shall have the right to specify as
its address any other address within the United States of America.
(f) No Waiver; Time of Essence. The failure of either party to
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enforce any of the respective rights or remedies hereunder, or to promptly
enforce any such rights or remedies, shall not constitute a waiver thereof nor
give rise to any estoppel against such party nor excuse any of the parties
hereto from their respective obligations hereunder. Any waiver of such right or
remedy must be in writing and signed by the party to be bound and must expressly
state that such right or remedy has been or thereby is waived. This Agreement is
subject to enforcement at law or in equity, including actions for damages or
specific performance. Time is of the essence hereof.
(g) Captions for Convenience. The captions and headings of the
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section and paragraphs of this Agreement are for convenience of reference only
and shall not be construed in interpreting the provisions hereof.
(h) Attorney's Fees. In the event it is necessary for Landlord
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to retain the services of an attorney or any other consultants in order to
enforce this Agreement, or any portion hereof, Guarantor shall promptly pay to
Landlord any and all costs and expenses, including, without limitation,
attorney's fees, incurred by Landlord as a result thereof and such costs, fees
and expenses shall be included in the costs of the case to the extent the
Landlord wins the issue under contest.
(i) Successive Actions. Separate and successive actions may be
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brought hereunder to enforce any of the provisions hereof at any time and from
time to time. No action hereunder shall preclude any subsequent action, and
Guarantor hereby waives any covenants to the maximum extent permitted by law not
to assert any defense in the nature of splitting of causes of action or merger
of judgments.
(j) Reliance. Landlord would not enter into the Lease without
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this Agreement. Accordingly, Guarantor intentionally, irrevocably and
unconditionally enters into the covenants and agreements as set forth above and
understand that, in reliance upon and in consideration of such covenants and
agreements, the Lease has been made.
IN WITNESS WHEREOF, Guarantor has executed this Agreement under seal
as of the day and year first above written.
GUARANTOR:
ATTEST/WITNESS: GENEVA ENTERPRISES, INC.
/s/ Xxxx Xxxxx By: /s/ Xxxxxx X. Xxxxxxxxx
Name: Xxxx Xxxxx Name: Xxxxxx X. Xxxxxxxxx*
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Title: __________________________ Title: Chairman
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* By Xxxxxx Xxxxxx as Attorney-in-Fact.
