GUARANTY
Exhibit
10.3
This Guaranty (the “Guaranty”), dated and
effective as of December 31, 2008, and is made and entered into by ST. XXXXXX
XXXX, LLC, a Nevada limited liability company (“Guarantor”) with reference to
the following facts:
R E C I T A L S
A. St.
Xxxxxx Xxxx Dialysis Center, LLC, a Maryland limited liability company (“Dialysis”) and DCA of
Hyattsville, LLC, a Maryland limited liability company (“Purchaser”) are parties to
that certain Asset Purchase Agreement, dated as of December 31, 2008 (the “Purchase
Agreement”).
B. In
the event Closing (as defined in the Purchase Agreement) occurs under the
Purchase Agreement, Guarantor has agreed to execute this Guaranty in favor of
Purchaser to guaranty the performance by Dialysis of the General Covenants (as
defined in the Purchase Agreement) for a period of eighteen (18) months
following Closing Date (as defined in the Purchase Agreement) under the Purchase
Agreement (the “Survival
Period”).
NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Guarantor agrees as follows:
A G R E E M E N T
1. Recitals. Each
and all of the foregoing recitals of background facts are incorporated herein by
this reference as though set forth herein verbatim.
2. Definition of Terms Used
Herein. The capitalized terms in this Guaranty shall
have the meanings set forth in the Purchase Agreement unless otherwise expressly
indicated herein.
3. Guaranty.
3.1 Guarantor
guarantees the performance by Dialysis of the General Covenants of Dialysis
under the Purchase Agreement during the Survival Period. This
Guaranty is an absolute guaranty of payment and performance and not of
collection.
3.2 If
Purchaser determines that Dialysis has defaulted on, or breached or violated any
of its General Covenants of Dialysis under the Purchase Agreement and such
default is not cured within ten (10) business days following written notice from
Purchaser to Dialysis and Guarantor, then Purchaser shall have the right to
pursue an action against Guarantor for the actual damages (excluding
consequential, speculative and punitive damages) incurred by Purchaser directly
related to such breach or default of by Dialysis of its General
Covenants. Any action that is not brought by Purchaser against
Guarantor prior to the end of the Survival Period shall thereafter be barred;
provided that Purchaser delivers to the Guarantor during the Survival Period a
written notice (i) stating its intention to file a legal action against the
Guarantor, and (ii) setting forth in reasonable detail the grounds for such
legal action, then Purchaser shall have an additional thirty (30) calendar days
following the conclusion of the Survival Period in which to file, and serve upon
the Guarantor, the complaint in such legal action.
3.3 No member
or employee of Guarantor shall have any personal liability, directly or
indirectly, under or in connection with the Guaranty except for any acts of a
member or employee of Guarantor of intentional fraud or intentional
misrepresentation.
3.4 Notwithstanding
anything to the contrary contained herein: (a) Guarantor shall have
no liability (and Purchaser shall make no claim against Guarantor, or any member
or employee of Guarantor) under this Guaranty or any document executed by
Guarantor in connection with this Guaranty, unless the valid claims by Purchaser
under this Guaranty collectively aggregate to more than Ten Thousand Dollars
($10,000); (b) the liability of Guarantor under this Agreement and such
documents shall not exceed, in the aggregate, an amount equal to Six Million
Dollars ($6,000,000) under any circumstances; and (c) in no event shall
Guarantor be liable for any consequential, special or punitive
damages. The provisions of this Section 3.4 shall not apply to any
acts by Guarantor of intentional fraud or intentional
misrepresentation.
4. General
Provisions.
4.1 Guarantor
agrees to pay, upon Purchaser’s demand, Purchaser’s reasonable out-of-pocket
costs and expenses, including but not limited to attorneys’ fees, costs and
disbursements, incurred in any effort to collect or enforce the obligations of
Guarantor under this Guaranty, regardless whether any lawsuit is filed, and in
the representation of Purchaser in any insolvency, bankruptcy, reorganization or
similar proceeding relating to Dialysis or Guarantor. Until paid to Purchaser,
such sums will bear interest from the date such costs and expenses are incurred
at the rate of eight percent (8%) per annum.
4.2 No
provision of this Guaranty or Purchaser’s rights hereunder may be waived or
modified nor can Guarantor be released from its obligations hereunder except by
a writing executed by Purchaser. No such waiver shall be applicable except in
the specific instance for which given. All remedies of Purchaser
against Dialysis and Guarantor are cumulative, except that the aggregate
liability of Dialysis and Guarantor shall not exceed the aggregate amount in
Section 3.4(b) of this Guaranty. This Guaranty shall be governed by
and construed under the laws of the State of Maryland and venue for any action
under this Guaranty shall be in Prince George’s County, Maryland. The
provisions of this Guaranty will bind and benefit the heirs, executors,
administrators, legal representatives, successors and assigns of Dialysis and
Guarantor and will inure to and benefit the Purchaser and its administrators,
legal representatives, successors and assigns.
4.3 In the
event of a sale or other disposition by Guarantor of all or substantially all of
its assets prior to the conclusion of the Survival Period, the acquirer of such
asssets shall be deemed a “successor” Guarantor for purposes of this
Guaranty.
IN WITNESS WHEREOF, GUARANTOR has
caused its duly authorized officer to execute this Guaranty of Lease as of this
31st day of December, 2008.
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ST.
XXXXXX XXXX, LLC,
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a
Nevada limited liability company
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By:
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ST.
XXXXXX XXXX FACILITY, LLC,
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a
Maryland limited liability company
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Its: Member
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By:
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G&L
ST. XXXXXX XXXX, LLC,
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a
Nevada limited liability company
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Its: Venture
Manager
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By:
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G&L
SENIOR CARE PROPERTIES, LLC,
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a
Nevada limited liability company
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Its: Member
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By:
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/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx
X. Xxxxxxxx
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Its: Managing
Director
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