Exhibit 10.8
THIS AGREEMENT OF GUARANTEE formally dated as of the day of July, 2005.
B E T W E E N:
1500536 ONTARIO INC., 00 Xxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxxxx X0X 0X0
(hereinafter called the "Guarantor"),
OF THE FIRST PART;
-and-
XXXXX XXXXXXXX, XXXXX XXXXXXX, XXX XXXXX, c/o Xxxxxx,
Xxxxxx LLP, 000 Xxxxxx Xxxx, Xxxxx 000, Xxxxxx,
Xxxxxxx X0X 0X0
(hereinafter called the "Vendors"),
OF THE SECOND PART.
WHEREAS TELEPLUS CONNECT CORP. (the "Company") has authorized, executed and
delivered in favour of the Vendors a promissory note (the "Note") dated as of
the day of July, 2005 in the principal amount of Six Hundred Sixteen Thousand
Eight Hundred Twenty Two Dollars ($616,822.) pursuant to the provisions of a
certain share purchase agreement (the "Agreement") dated June 30, 2005, between
the Company and the Vendors with respect to all issued and outstanding shares of
the Guarantor.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the premises
the Guarantor covenants and agrees with the Vendors as follows:
SECTION 5.
GUARANTEE
5.1. For valuable consideration, the Guarantor unconditionally guarantees and
covenants with the Vendors that the Company will duly and punctually pay to the
Vendors all debts and liabilities, present or future, direct or indirect,
absolute or contingent, matured or not at any time owing by the Company to the
Vendors wherever incurred and whether incurred by the Company alone or with
another or others, including, without limitation, all the principal of, interest
on and all other moneys owing under the Note as and when the same become due and
payable according to the terms of the Note (the "Company's Debts").
5.2. The Guarantor hereby acknowledges communication of the terms of the Note
and consents to and approves of the same. The guarantee herein contained shall
take effect and be binding upon the Guarantor notwithstanding any defect in or
omission from any documentation or security delivered by the Company to the
Vendors or any default in or omission from the Note or any non-registration or
non-filing or defective registration or filing or by reason of any failure of
the security intended to be created by the Note or any other security.
5.3. The liability of the Guarantor under Section 1.1 hereof shall be joint and
several with that of the Company and shall be absolute and unconditional. The
Guarantor shall for all purposes of the guarantee be regarded as in the same
position as a principal debtor, and to the extent permitted by applicable law
hereby expressly waives demand, presentment, protest and notice thereof and of
default save and except as required by the Note. The obligation of the Guarantor
hereunder shall be deemed to arise in respect of each default.
1.4 The liability of the Guarantor under this Agreement is limited to Six
Hundred Sixteen Thousand Eight Hundred Twenty Two Dollars ($616,822.) plus
interest on all amounts due under this Agreement from the date the Vendors
demand payment thereof, at the rate of two percent (2%) per annum above the
floating annual prime rate of interest established from time to time by the
Royal Bank of Canada. The maximum liability of the Guarantor hereunder shall be
reduced in proportion to such payments as are made by the Company to the
Creditors pursuant to the Agreement.
SECTION 6.
DEFAULT AND ENFORCEMENT
6.1. If the Company shall make default in payment of the principal of, interest
on or any other moneys owing to the Vendors on any of the Company's Debts
including, without limitation, any principal of, interest on or other monies
owing under the Note as and when the same become due and payable, then the
Guarantor shall forthwith on demand by the Vendors pay to the Vendors the
principal, interest and other moneys in default.
6.2. If the Guarantor shall fail forthwith on demand to make good any such
default, the Vendors may in its discretion proceed with the enforcement of its
rights hereunder and may proceed to enforce such rights or from time to time any
thereof prior to, contemporaneously with or after any action taken under any
security or other documents delivered by the Company or others to the Vendors,
including the Note. The Guarantor shall pay on demand all costs and expenses
(including reasonable legal fees) incurred by the Vendors in enforcing or
attempting to enforce its rights hereunder and all proceedings taken in relation
hereto; all such costs and expenses and other moneys payable hereunder shall
bear interest at the greater of the loan rate or the interest rate provided for
in any of the Note, other security or loan documents.
6.3. All sums paid to or recovered by the Vendors pursuant to the provisions
hereof shall be applied by them in payment of their costs and expenses payable
hereunder and the principal, interest and other moneys owing to the Vendors
including, without limitation, all amounts owing on the Note and in such order
as the Vendors in their sole discretion may determine.
6.4. The Vendors may waive any default of the Guarantor hereunder upon such
terms and conditions as it may determine provided that no such waiver shall
extend to or be taken in any manner whatsoever to affect any subsequent default
or the rights resulting therefrom.
6.5. Any moneys paid by or recovered from the Guarantor hereunder shall be held
to have been paid pro tanto in discharge of the liability of the Guarantor
hereunder, but not in discharge of the liability of the Company, and in the
event of any such payment by or recovery from the Guarantor, the Guarantor
hereby assigns any rights with respect to or arising from such payment or
recovery (including without limitation any right of subrogation) to the Vendors
unless or until the Vendors have received in the aggregate payment in full of
all moneys owing to the Vendors including, without limitation, amounts on the
Note. If the Guarantor receives money in payment of any such debts and
liabilities, the Guarantor will hold them in trust for, and will immediately pay
funds to, the Vendors without reducing the Guarantor's liability under this
Guarantee.
SECTION 7.
ABSOLUTE LIABILITY
7.1. The liability of the Guarantor under this Guarantee is absolute and
unconditional. It will not be limited or reduced, nor will the Vendors be
responsible or owe any duty (as a fiduciary or otherwise) to the Guarantor, nor
will the Vendors rights under this Guarantee be prejudiced, by the existence or
occurrence (with or without the Guarantor's knowledge or consent) of any one or
more of the following events:
(n) any termination, invalidity, unenforceability or release by the
Vendors or any of their rights against the Company or against any
other person or of any security;
(o) any increase, reduction, renewal, substitution or other change in,
or discontinuance of, the terms relating to the Company's Debts or
to any credit extended by the Vendors to the Company; any agreement
to any proposal or scheme of arrangement concerning, or granting any
extensions of time or any other indulgences or concessions to, the
Company or any other person; any taking or giving up of any
security; abstaining from taking, perfecting, filing or registering
any security; allowing any security to lapse (whether by failing to
make or maintain any registration, filing or otherwise); or any
neglect or omission by the Vendors in respect of, or in the course
of, doing any of these things;
(p) accepting compositions from compromises, arrangements or plans of
reorganizations or granting releases or discharges to the Company or
any other person, or any other dealing with the Company or any other
person or with any security that the Vendors consider appropriate;
(q) any unenforceability or loss of or in respect of the Note or any
security held from time to time by the Vendors from the undersigned,
the Company or any other person, whether the loss is due to the
means or timing of any registration, disposition or realization of
any collateral that is the subject of that security or otherwise due
to the Vendors fault or any other reason;
(r) any change in the Company's name; or any reorganization (whether by
way of amalgamation, merger, transfer, sale lease or otherwise) of
the Company or the Company's business;
(s) any change in the Company's financial condition or that of the
Company or any other guarantor (including insolvency and
bankruptcy);
(t) any change of effective control of the Company;
(u) any event, whether or not attributable to the Vendors, that may be
considered to have caused or accelerated the bankruptcy or
insolvency of the Company or any Guarantor, or to have resulted in
the initiation of any such proceedings;
(v) The Vendors filing of any claim for payment with any administrator,
provisional liquidator, conservator, trustee, receiver, custodian or
other similar officer appointed for the Company or for all or
substantially all of the Company's assets;
(w) any failure by the Vendors to abide by any of the terms and
conditions of the Vendors agreements with, or to meet any of its
obligations or duties owed to, the Company or any person, or any
breach of any duty (whether as a fiduciary or otherwise) that exists
or is alleged to exist between the Vendors and the Guarantor, the
Company or any person;
(x) any incapacity, disability, or lack or limitation of status or of
the power of the Company or of the Company's directors, managers,
officers, partners or agents; the discovery that the Company is not
or may not be a legal entity; or any irregularity, defect or
informality in the incurring of any of the Company's Debts;
(y) any event whatsoever that might be a defence available to, or result
in a reduction or discharge of, the Guarantor, the Company or any
other person in respect of either the Company's Debts or the
Guarantor's liability under this Guarantee; or
(z) any amendment to any, some or all of the Note or any other security
or agreements as between the Company and the Vendors .
For greater certainty, the undersigned agrees that the Vendors may deal
with the Guarantor, the Company and any other person in any manner without
affecting the Guarantor's liability under this Guarantee.
Any claims by the Guarantor against the Vendors and its agents in
respect of any of the foregoing matters or otherwise are hereby waived.
7.2. After all moneys payable by the Company to the Vendors including,
without limitation, amounts owing under the Note, have been paid in full, this
guarantee shall cease and become null and void and the Vendors shall, at the
request and at the expense of the Guarantor execute and deliver a release to the
Guarantor.
SECTION 8.
MISCELLANEOUS
8.1. Any notice required or desired to be given hereunder or under any
instrument supplemental hereto shall be in writing and may be given by personal
delivery, by facsimile (to the Guarantor at 000-000-0000 and to the Vendors at
705-792-6911) or other means of electronic communication or by sending the same
by registered mail, postage prepaid, to the Vendors or to the Debtor at their
respective addresses set out above and, in the case of electronic communication,
to the facsimile numbers set out above. Any notice so delivered shall be
conclusively deemed given when personally delivered and any notice sent by
facsimile or other means of electronic transmission shall be deemed to have been
delivered on the Business Day following the sending of the notice, and any
notice so mailed shall be conclusively deemed given on the third Business Day
following the day of mailing, provided that in the event of a known disruption
of postal service, notice shall not be given by mail. Any address for notice or
payments herein referred to may be changed by notice in writing given pursuant
hereto.
8.2. This Agreement shall be construed in accordance with and governed by the
laws of the Province of Ontario.
SECTION 9.
CERTAIN COVENANTS BY THE GUARANTOR
9.1. The Guarantor hereby covenants and agrees that it will:
(c) carry on and conduct its business in a proper and efficient manner
so as to preserve and protect its property and assets and the income
therefrom and shall keep proper books of accounts and make therein
true and faithful entries of all dealings and transactions in
relation to its business and furnish to the Vendors such information
relating to the Guarantor's business as the Vendors may require, and
such books of account shall at all times during normal business
hours and upon reasonable prior notice to the Guarantor be open for
inspection by the Vendors or such agent or attorney as it shall from
time to time by instrument in writing for that purpose appoint; and
(d) at all times maintain its corporate existence and will diligently
preserve all rights, powers, privileges and goodwill owned by it.
IN WITNESS WHEREOF the Guarantor has executed these presents under its corporate
seal.
1500536 ONTARIO INC.
By: /s/ Marius Silvasan
-----------------------------------------
Marius Silvasan, President
We have authority to bind the Corporation
