EXHIBIT 10.8
CONTINUING GUARANTY
TO: FIRST HAWAIIAN BANK, AS AGENT, AND TO THE BANKS THAT ARE, OR MAY
BECOME, PARTIES TO THE AGREEMENT
Xxxxxxx Homes, Inc., a Delaware corporation (herein the
"Company"), has entered into a Revolving Credit Agreement dated as of even
date herewith (the "Agreement") with First Hawaiian Bank, as Agent (the
"Agent"), and First Hawaiian Bank, Bank of America, N.A., Fleet National
Bank, N.A., and California Bank & Trust (together with any other financial
institution from time to time a party to the Agreement, the "Banks").
Capitalized terms used herein and not otherwise defined shall have the same
meanings as the terms used and defined in the Agreement. Subject to the terms
and provisions set forth in the Agreement, the Banks have agreed to make
Loans to the Company. As a condition to the obligation of the Banks to make
such Loans, each of the Subsidiaries of the Company listed on SCHEDULE A
hereto (collectively, "Guarantor") is required to execute and deliver to the
Agent this Guaranty. To induce the Banks to make the Loans to the Company as
provided in the Agreement, Guarantor hereby agrees as follows:
1. GUARANTY OF OBLIGATIONS. For valuable consideration, Guarantor
unconditionally guarantees and promises to pay to the Agent, for the benefit
of the Banks, or order, on demand, after the occurrence of an Event of
Default, in lawful money of the United States of America:
(1) all outstanding Loans and other Obligations of the Company
evidenced by each Note; and
(2) all other Obligations of the Company, including without
limitation all amendments, modifications, supplements, renewals, or
extensions of the foregoing, whether such amendments, modifications,
supplements, renewals, or extensions are evidenced by new or additional
instruments, documents, or agreements or change the rate of interest on
any indebtedness or the maturity thereof, or otherwise. All indebtedness
and obligations covered by this Guaranty are hereinafter collectively
referred to as the "indebtedness." The term "indebtedness" shall also
include, without limitation on the foregoing, all interest that accrues on
all or any part of the indebtedness after the filing of any petition or
pleading against the Company or any other Person for a proceeding under
any chapter or provision of any present or future federal bankruptcy
legislation or amendments thereto.
2. NATURE OF GUARANTY. This Guaranty is continuing in nature and
relates to any indebtedness, including indebtedness arising after the date
hereof and any renewals or extensions of any indebtedness. The guaranty
contained herein is a guaranty of payment and not of collection.
3. RIGHTS INDEPENDENT. The obligations of Guarantor hereunder are
independent of the Obligations of the Company or any other Person or any
other guarantor or
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any security for the indebtedness or Obligations, and the Agent may, upon the
occurrence of an Event of Default, proceed in the enforcement hereof
independently of any other right or remedy that the Agent may at any time
hold with respect to the Obligations, the indebtedness or any security or
other guaranty therefor. The Agent may file a separate action or actions
against Guarantor hereunder, whether action is brought and prosecuted with
respect to any security or against the Company or any other Guarantor or any
other Person, or whether the Company or any other Guarantor or any other
Person is joined in any such action or actions. Guarantor waives the benefit
of any statute of limitations affecting its liability hereunder or the
enforcement of the Obligations. The liability of Guarantor hereunder shall be
reinstated and revived, and the rights of the Agent and each Bank shall
continue, with respect to any amount at any time paid on account of the
Obligations which shall thereafter be required to be restored or returned by
Agent or any Bank upon the bankruptcy, insolvency, or reorganization of the
Company or any other Person, or otherwise, all as though such amount had not
been paid. Guarantor further agrees that to the extent the Company or
Guarantor makes any payment to Agent or any Bank in connection with the
Obligations or the indebtedness and all or any part of such payment is
subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid by the trustee, receiver or any other entity,
whether under any bankruptcy act or otherwise (any such payment is
hereinafter referred to as a "Preferential Payment"), then this Guaranty
shall continue to be effective or shall be reinstated, as the case may be,
and, to the extent of such payment or repayment by Agent or such Bank, the
obligations or the indebtedness or part thereof intended to be satisfied by
such Preferential Payment shall be revived and continued in full force and
effect as if said Preferential Payment had not been made.
4. AUTHORITY TO MODIFY THE OBLIGATIONS. Guarantor authorizes the
Agent and each Bank, without notice to or demand on Guarantor and without
affecting its liability hereunder or the enforceability hereof, from time to
time to: (a) supplement, modify, amend, extend, renew, accelerate, or
otherwise change the time for payment or the terms of the Obligations or any
part thereof, including increase or decrease the rates of interest thereon;
(b) supplement, modify, amend, or waive, or enter into or give any agreement,
approval, or consent with respect to, the indebtedness or any part thereof or
any of the Loan Documents or any security or additional guaranties, or any
condition, covenant, default, remedy, right, representation, or term thereof
or thereunder; (c) accept new or additional instruments, documents, or
agreements in exchange for or relative to any of the Loan Documents or the
Obligations or any part thereof; (d) accept partial payments on the
Obligations; (e) receive and hold additional security or guaranties for the
Obligations or any part thereof or this Guaranty; (f) release, reconvey,
terminate, waive, abandon, subordinate, exchange, substitute, transfer, and
enforce the Obligations or any security or any other guaranties, and apply
any security and direct the order or manner of sale thereof as Agent or such
Bank in its discretion may determine; (g) release the Company or any other
Person or any other guarantor from any personal liability with respect to the
Obligations or any part thereof; (h) settle, release on terms satisfactory to
Agent or such Bank or by operation of law or otherwise, compound, compromise,
collect, or otherwise liquidate or enforce any of the Obligations and any
security or other guaranty in any manner, consent to the transfer of any
security, and bid and purchase at any sale; and (i) consent to the merger or
any other change, restructure, or termination of the corporate existence of
the Company or any other Person and correspondingly restructure the
Obligations, and any such merger, change, restructure, or termination shall
not affect the liability of Guarantor hereunder or the enforceability hereof
with respect to all indebtedness.
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5. WAIVER OF DEFENSES. Guarantor waives any right to require
Agent or any Bank, prior to or as a condition to the enforcement of this
Guaranty, to: (a) proceed against the Company or any other Person or any
other guarantor; (b) proceed against or exhaust any security for the
Obligations or to marshal assets in connection with foreclosing collateral
security; (c) give notice of the terms, time, and place of any public or
private sale of any security for the Obligations; or (d) pursue any other
remedy in Agent's or such Bank's power whatsoever. Guarantor waives any
defense arising by reason of (i) any disability or other defense of the
Company or any other Person with respect to the Obligations, (ii) the
unenforceability or invalidity of the Obligations or any security or any
other guaranty for the Obligations or the lack of perfection or failure of
priority of any security for the Obligations, (iii) the cessation from any
cause whatsoever of the liability of the Company or any other Person or any
other guarantor (other than by reason of the full payment and discharge of
all indebtedness), or (iv) any act or omission of Agent or any Bank or any
other Person which directly or indirectly results in or aids the discharge or
release of the Company or any other Person or the Obligations or any security
or other guaranty therefor by operation of law or otherwise. Guarantor waives
all presentments, demands for performance, notices of nonperformance,
protests, notices of protest, notices of dishonor, and all other notices of
any kind or nature whatsoever with respect to the Obligations, and notices of
acceptance of this Guaranty and of the existence, creation, or incurring of
new or additional Obligations.
6. DEFERRAL OF SUBROGATION. Until all Obligations have been paid
and performed in full, (a) Guarantor shall not exercise any rights of
subrogation, contribution or reimbursement against the Company or any other
guarantor of the Obligations (individually each an "other Loan Party"), and
(b) Guarantor shall not exercise any right to enforce any right, power or
remedy which Agent or each Bank now has or may in the future have against any
other Loan Party and any benefit of, and any right to participate in, any
security for this Guaranty or for the obligations of any other Loan Party now
or in the future held by Agent or each Bank. If Guarantor nevertheless
receives payment of any amount on account of any such subrogation,
contribution or reimbursement rights or otherwise in respect of any payment
by Guarantor of the Obligations prior to payment and performance in full of
all Obligations, such amount shall be held in trust for the benefit of the
Agent and immediately paid to the Agent for application to the Obligations in
such order and manner as the Agent may determine.
7. DEEDS OF TRUST ON REAL PROPERTY. Guarantor understands and
acknowledges that if the indebtedness is ever secured by real property and
Agent or a Bank forecloses judicially or nonjudicially against any real
property security for the indebtedness, that foreclosure could impair or
destroy any ability that Guarantor may have to seek reimbursement,
contribution or indemnification from the Company or others based on any right
Guarantor may have of subrogation, reimbursement, contribution or
indemnification for any amounts paid by Guarantor under this Guaranty.
Guarantor further understands and acknowledges that in the absence of this
provision, such potential impairment or destruction of Guarantor's rights, if
any, may entitle Guarantor to assert a defense to this Guaranty based on
Section 580d of the California Code of Civil Procedure as interpreted in
UNION BANK x. XXXXXXX, 265 Cal.App.2d 40 (1968). By executing this Guaranty,
Guarantor freely, irrevocably and unconditionally: (i) waives and
relinquishes that defense and agrees that Guarantor will be fully liable
under this Guaranty even though Agent or a Bank may foreclose judicially or
nonjudicially against the real property security for the indebtedness; (ii)
agrees that Guarantor will not assert that defense in any action or
proceeding which Agent or a Bank
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may commence to enforce this Guaranty; (iii) acknowledges and agrees that the
rights and defenses waived by Guarantor in this Guaranty include any right or
defense that Guarantor may have or be entitled to assert based upon or
arising out of any one or more of Sections 580a, 580b, 580d or 726 of the
California Code of Civil Procedure or Section 2848 of the California Civil
Code; and (iv) acknowledges and agrees that Agent and each Bank are relying
on this waiver in entering into the Agreement, and that this waiver is a
material part of the consideration which Agent and each Bank are receiving
for entering into the Agreement. Guarantor further acknowledges and agrees
that the waivers set forth in this Guaranty are operative regardless of
whether Guarantor may have made any payments to Agent or any Bank. Guarantor
further waives all rights and defenses arising out of an election of remedies
by Agent or a Bank, even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for a guaranteed obligation,
has destroyed Guarantor's right of subrogation and reimbursement against the
Company by the operation of Section 580d of the California Code of Civil
Procedure or otherwise. Guarantor specifically waives any right to a fair
value hearing, and any and all other rights it may have under Section 580a of
the California Code of Civil Procedure. Without limiting the foregoing,
should any of the indebtedness guaranteed hereby ever be secured by real
property, Guarantor further agrees as follows: Guarantor waives all rights
and defenses that the Guarantor may have because the Company's debt is
secured by real property. This means, among other things: (1) Agent and the
Banks may collect from the Guarantor without first foreclosing on any real or
personal property collateral pledged by the Company, and (2) if Agent and the
Banks foreclose on any real property collateral pledged by the Company: (A)
the amount of the debt may be reduced only by the price for which that
collateral is sold at the foreclosure sale, even if the collateral is worth
more than the sale price, and (B) Agent and each Bank may collect from the
Guarantor even if Agent or the Banks, by foreclosing on the real property
collateral, have destroyed any right the Guarantor may have to collect from
the Company. This is an unconditional and irrevocable waiver of any rights
and defenses that Guarantor may have because the Company's debt is secured by
real property. These rights and defenses include, but are not limited to, any
rights or defenses based upon Sections 580(a), 580(b), 580(d), or 726 of the
Code of Civil Procedure.
8. CONDITIONS. Guarantor represents and warrants to the Agent,
for the benefit of the Banks that: (a) this Guaranty is executed at the
request of the Company; (b) that Guarantor has established adequate means of
obtaining from the Company on a continuing basis financial and other
information pertaining to the business of the Company; and (c) that Guarantor
is now and will be completely familiar with the business, operation,
condition, and assets of the Company. Guarantor hereby waives and
relinquishes any duty on the part of the Agent or any Bank to disclose to
Guarantor any matter, fact, or thing relating to the business, operation,
condition, or assets of the Company now known or hereafter known by the Agent
or any Bank during the life of this Guaranty. With respect to any
Obligations, neither the Agent nor any Bank need inquire into the powers of
the Company or the officers or employees acting or purporting to act on its
behalf, and all Obligations made or created in good faith reliance upon the
professed exercise of such powers shall be guaranteed hereby.
9. AMENDMENTS; WAIVERS. Neither this Guaranty nor any provision
hereof may be amended, modified, waived, discharged, or terminated except by
an instrument in writing duly signed by or on behalf of the Banks. Guarantor
warrants and agrees that each of the waivers set forth in this Guaranty are
made with Guarantor's full knowledge of their significance and consequences,
and that under the circumstances, the waivers are reasonable
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and not contrary to public policy or law. If any of such waivers are
determined to be contrary to any applicable law or public policy, such
waivers shall be effective only to the maximum extent permitted by law.
10. NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Agent or any Bank, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power, remedy or privilege of
the Agent hereunder or the Banks under the Loan Documents preclude any other
or further exercise thereof or the exercise of any other right, power, remedy
or privilege.
11. COSTS AND EXPENSES IN ENFORCEMENT. Guarantor agrees to pay to
the Agent all reasonable advances, charges, costs, and expenses, including
reasonable Attorney Costs, incurred or paid by the Agent in exercising any
right, power, or remedy conferred by this Guaranty, or in the enforcement of
this Guaranty, whether or not an action is filed in connection therewith.
12. NOTICES. All notices, requests, demands, directions, and
other communications provided for hereunder must be in writing and must be
personally delivered or mailed to Guarantor at the address set forth on the
signature page of this Guaranty or at any other address as may be designated
by Guarantor in a written notice sent to the Banks in accordance with the
Agreement. Any notice, request, demand, direction, or other communication
given by mail will be deemed effective on the third calendar day after
deposited in the United States mails with first class postage prepaid; or if
given by personal delivery, when delivered.
13. BINDING AGREEMENT. This Guaranty and the terms, covenants,
and conditions hereof shall be binding upon and inure to the benefit of
Guarantor, each Bank, and their respective successors and assigns, except
that Guarantor shall not be permitted to transfer, convey, or assign this
Guaranty or any interest herein without the prior written consent of each
Bank. Each Bank may assign its interest hereunder in whole or in part in
connection with an assignment of its Loans, Commitments and other rights and
obligations under the Agreement pursuant to SECTION 11.6(a) thereof.
14. SEVERABILITY. In case any right or remedy of the Banks shall
be held to be invalid, illegal, or unenforceable, such invalidity,
illegality, or unenforceability shall not affect any other right or remedy
granted hereby.
15. MISCELLANEOUS. All words used herein in the plural shall be
deemed to have been used in the singular, and all words used herein in the
singular shall be deemed to have been used in the plural, where the context
and construction so require. Section headings in this Guaranty are included
for convenience of reference only and are not a part of this Guaranty for any
other purpose. This Guaranty is executed in connection with, and is subject
to, the terms and provisions of the Agreement.
16. GOVERNING LAW. This Guaranty shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of
California without regard to the conflict of law provisions thereof.
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17. JOINT AND SEVERAL LIABILITY. The liability and obligations of
each corporation, partnership, limited liability company or other entity
executing this Guaranty as a "Guarantor" hereunder shall be joint and
several; and, without limiting the foregoing, each such corporation,
partnership or other entity executing this Guaranty shall individually be
liable and responsible for repayment of the full amount of all Obligations
and indebtedness owing to each and all of the Banks.
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IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly
executed as of June 28, 2001.
"GUARANTOR":
EACH OF THE CORPORATE GUARANTORS
LISTED ON SCHEDULE I ATTACHED HERETO
By: /s/ Xxxxxx Xxxxxxxx
-----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
and Secretary
EACH OF THE OTHER GUARANTORS LISTED ON
SCHEDULE I ATTACHED HERETO
By: Its respective Managing Member
or Sole Manager, as the case may be
By: /s/ Xxxxxx Xxxxxxxx
-----------------------------
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
and Secretary
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SCHEDULE A
SUSIDIARIES
Melody Homes, Inc.
Melody Mortgage Co.
Xxxxxxx Homes of California, Inc.
Xxxxxxx Homes of Washington, Inc.
Xxxxxxx Homes of Oregon, Inc.
SHLR of Washington, Inc.
SHLR of Colorado, Inc.
SHLR of Nevada, Inc.
Xxxxxxx Realty/Maui, Inc.
Xxxxxxx Realty/Oahu, Inc.
Vertical Construction Corporation
SHLR of Utah, Inc.
Xxxxxxx Mortgage, Inc.
SHLR of California, Inc.
SSHI LLC (Xxxxxxxx)
SRHI LLC (Xxxxxx)
Xxxxxxx Homes Arizona LLC
SHA Construction LLC
LAMCO Housing, Inc.
II LAMCO Housing, Inc.
AP LHI, Inc.
APLAM, LLC
AP Western GP Corporation
AP WP Partners L.P.
AP WP Operating Corporation
HPH Homebuilders 2000 XX
Xxxxxx GP LLC
Xxxxxx XX LLC
Western Pacific Housing, Inc.
Western Pacific Housing Development Limited Partnership
Western Pacific Housing Development II Limited Partnership
WPH-Xxxxxx, LLC
Xxxxx, LLC (formerly WPH-Edgewood 56, LLC)
Western Pacific Housing-Agoura I, LLC
Western Pacific Housing-American Canyon, LLC
Western Pacific Housing-Antigua, LLC
Western Pacific Housing-Bay Vista, LLC
Western Pacific Housing-Broadway, LLC
Western Pacific Housing-Xxxxxxx, LLC
Western Pacific Housing-Calvine, LLC
Western Pacific Housing-Xxxxxxxx, LLC
Western Pacific Housing-Cloverdale I, LLC
Western Pacific Housing-Cloverdale II, LLC
Western Pacific Housing-Communications Hill, LLC
SCHEDULE A
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SUBSIDIARIES (CONTINUED)
Western Pacific Housing-Xxxxxxxx Commons I, LLC
Western Pacific Housing-Coto I, LLC
Western Pacific Housing-Creekside, LLC
Western Pacific Housing-Cypress Xxxxx, LLC
Western Pacific Housing-Deer Creek, LLC
Western Pacific Housing-East Park, LLC
Western Pacific Housing-Edgewood 45, LLC
Western Pacific Housing-Escondido, LLC
Western Pacific Housing-Fieldstone, LLC
Western Pacific Housing-Hercules MRB, LLC
Western Pacific Housing-Hercules Village, LLC
Western Pacific Housing-Land Park North, LLC
Western Pacific Housing-Xxxxxx Xxxxx XX, LLC
Western Pacific Housing-Lomas Verdes, LLC
Western Pacific Housing-Xxxxxxxx, LLC
Western Pacific Housing-Menifee, LLC
Western Pacific Housing-Xxxxxxxxxx, LLC
Western Pacific Housing-Murrieta, LLC
Western Pacific Housing-Natomas Village 13, LLC
Western Pacific Housing-Norco Estates, LLC
Western Pacific Housing-Paradise Creek, LLC
Western Pacific Housing-Providence I, LLC
Western Pacific Housing-Robinhood Ridge, LLC
Western Pacific Housing-Xxxxxxx Heights, LLC
Western Pacific Housing-Saddlebrook, LLC
Western Pacific Housing-San Elijo, LLC
Western Pacific Housing-Simi I, LLC
Western Pacific Housing-Sonoma, LLC
Western Pacific Housing-Spanish Hills, LLC
Western Pacific Housing-Stone Lake, LLC
Western Pacific Housing-Sun Valley, LLC
Western Pacific Housing-Terra Bay Xxxxx, LLC
Western Pacific Housing-Xxxxxx Xxxxx, LLC
Western Pacific Housing-Towngate, LLC
Western Pacific Housing-Valpico, LLC
Western Pacific Housing-Vineyard Terrace, LLC
Western Pacific Housing-Wesminster, LLC
Western Pacific Housing-Windsor Pointe, LLC
Western Pacific Housing-Black Mountain, LLC
Western Pacific Housing-Xxxxxxx Xxxxxxx, LLC
Western Pacific Housing-Carlsberg Ranch, LLC
Western Pacific Housing-Carpenteria, LLC
Western Pacific Housing-Dos Vientos 78, LLC
Western Pacific Housing-Fillmore, LLC
Western Pacific Housing-Xxxxx Canyon Partners, LLC
Western Pacific Housing-San Elijo Area R, LLC
SCHEDULE A
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SUBSIDIARIES (CONTINUED)
Western Pacific Housing-Xxxxx Ranch, LLC
Western Pacific Housing-Sorrento, LLC
Western Pacific Housing-Torrey Village Center
Western Pacific Housing-Torrey, LLC
Western Pacific Housing-Torrey Santa Fe, LLC
WPH-Camino Xxxx, LLC
WPH-HPH LLC
WPH-SAL2, L.P. (formerly WPH-Sunset Hills III, L.P.)
Western Pacific Funding, Inc.
Western Pacific Housing - XxXxxxxxx Canyon, LLC
Western Pacific Housing-Torrey Commercial, LLC
Western Pacific Housing-Torrey Multi-Family, LLC
WPH-SAL1, L.P.
WPH Management Co.
III LAMCO Housing, Inc.
IV LAMCO Housing, LLC
V LAMCO Housing, LLC
Allegra, LLC
Coto Venture, Ltd. (see WPH-Coto Venture, L.P.)
HPH Homebuilders LP 1995
HPH Homebuilders LP 1996
Livermore Homebuilders XX
Xxxxxx-Avalon LP
Western Pacific Housing-Altamar, LLC
Western Pacific Housing-Altura, L.P.
Western Pacific Housing-Arbor Hills, LLC
Western Pacific Housing-Aviara, L.P.
Western Pacific Housing-Bella Nevona, LLC
Western Pacific Housing Co.
Western Pacific Housing-Canyon Park, LLC
Western Pacific Housing-Carlsbad I, LLC
Western Pacific Housing-Carmel, LLC
Western Pacific Housing-Xxxxxx Station, LLC
Western Pacific Housing-Corona, L.P.
Western Pacific Housing-Coto Venture, L.P.
Western Pacific Housing-Xxxxxx City, L.P.
Western Pacific Housing-Xxxxxx Grove, LLC
Western Pacific Housing-Del Sol
Western Pacific Housing-El Camino, LLC
Western Pacific Housing-Financing Partners
Western Pacific Housing-Xxxx View, LLC
Western Pacific Housing-Hamptons, L.P.
Western Pacific Housing-Lost Hills Park, LLC
Western Pacific Housing-Mayfair, LLC
Western Pacific Housing-Mountaingate, L.P.
Western Pacific Housing-Oso, L.P.
SCHEDULE A
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SUBSIDIARIES (CONTINUED)
Western Pacific Housing-Pacific Park, L.P.
Western Pacific Housing-Pacific Park II, LLC
Western Pacific Housing-Penasquitos, LLC
Western Pacific Housing-Poinsettia, L.P.
Western Pacific Housing-Rancho Del Tio, LLC
Western Pacific Housing-Riverside I, LLC
Western Pacific Housing-San Simeon, L.P.
Western Pacific Housing-San Xxxxxx XX, L.P.
Western Pacific Housing-Santa Fe, LLC
Western Pacific Housing-Saugus, L.P.
Western Pacific Housing-Scripps, L.P.
Western Pacific Housing-Scripps II, LLC
Western Pacific Housing-Seacove, L.P.
Western Pacific Housing-Shadow Creek, LLC
Western Pacific Housing-Skyridge, L.P.
Western Pacific Housing-Xxxxxxx I, LLC
Western Pacific Housing-Sunset Hills I, L.P.
Western Pacific Housing-Sunset Hills II, L.P.
Western Pacific Housing-Xxxxxx Place, LLC
Western Pacific Housing-Tiburon II, L.P.
Western Pacific Housing-Torrey Hills, LLC
Western Pacific Housing-Westlake, L.P.
Western Pacific Housing-Westlake II, L.P.
Western Pacific Housing-Windflower, L.P.
Western Pacific Housing-Winterhaven, LLC
Western Pacific Housing-Xxxxx, X.X
SCEDULE A
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