GUARANTY
Bloomington, Minnesota
October 24, 1997
For valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and in consideration of and to induce financial
accommodations of any kind, with or without security, given or to be given or
continued at any time and from time to time by SPECTRUM COMMERCIAL SERVICES, a
division of Lyon Financial Services, Inc. (hereinafter called the "Lender") to
or for the account of INFINITE GRAPHICS Incorporated, a Minnesota corporation,
(hereinafter called the "Borrower"), the undersigned absolutely and
unconditionally guarantees to the Lender the full and prompt payment when due,
whether at maturity or earlier by reasons of acceleration or otherwise, of any
and all indebtedness, obligations and liabilities of the Borrower (and any and
all successors of the Borrower) to the Lender and also to others to the extent
of their participations granted to or interests therein created or acquired for
them by the Lender, now or hereafter existing, absolute or contingent,
independent, joint, several or joint and several, secured or unsecured, due or
to become due, contractual or tortious liquidated or unliquidated, arising by
assignment or otherwise, including without limitation all indebtedness,
obligations and liabilities owed by the Borrower (and any and all successors of
the Borrower) as a member of any partnership, syndicate association or other
group, and whether incurred by the Borrower (or any successor of the Borrower)
as principal, surety, endorser, guarantor, accommodation party or otherwise
(hereinafter collectively referred to as the "Indebtedness"); and the
undersigned agrees to pay on demand all of the Lender's fees, costs, expenses
and reasonable attorneys' fees in connection with the Indebtedness, and security
therefor, and this guaranty, plus interest on such amounts at the highest rate
then applicable to any of the Indebtedness.
The Lender may at any time and from time to time, without consent of or
notice to the undersigned, without incurring responsibility to the undersigned,
without releasing, impairing or affecting the liability of the undersigned
hereunder, upon or without any terms or conditions, and in whole or in part: (1)
sell, pledge, surrender, compromise, settle, release, renew, subordinate,
extend, alter, substitute, exchange, change, modify or otherwise dispose of or
deal with in any manner and in any order any Indebtedness, any evidence thereof,
or any security or other guaranty therefor; (2) accept any security for or other
guarantor of any Indebtedness; (3) fail, neglect or omit to obtain, realize upon
or protect any Indebtedness or any security therefor, to exercise any lien upon
or right to any money, credit or property toward the liquidation of the
Indebtedness, or to exercise any other right against the Borrower, the
undersigned, any other guarantor or any other person; and (4) apply any payments
and credits to the Indebtedness in any manner and in any order. No act, omission
or thing, except full payment and discharge of the Indebtedness, which but for
this provision could act as a release or impairment of the liability of the
undersigned hereunder, shall in any way release, impair or otherwise affect the
liability of the undersigned hereunder, and the undersigned waives any and all
defenses of the Borrower pertaining to the Indebtedness, any evidence thereof,
and any security therefor, except the defense of discharge by payment. The
failure of any person or persons to sign this or any other guaranty shall not
release, impair or affect the liability of the undersigned hereunder. This
guaranty is a primary obligation of the undersigned and the Lender shall not be
required to first resort for payment of the Indebtedness to the Borrower or any
other person, their
properties or estates, or any security or other rights or remedies whatsoever.
The undersigned shall be and remain liable for any deficiency remaining after
foreclosure of any mortgage or security interest securing the Indebtedness,
whether or not the liability of the Borrower or any other person for such
deficiency is discharged pursuant to statute, judicial decision or otherwise.
The liability of the undersigned under this guaranty is in addition to
and shall be cumulative with all other liabilities of the undersigned to the
Lender, as guarantor or otherwise, without any limitations as to amount, unless
the writing evidencing or creating such other liability specifically provides to
the contrary. If any payment applied by the Lender to the Indebtedness is
thereafter set aside, recovered, rescinded or required to be returned for any
reason (including without limitation the bankruptcy, insolvency or
reorganization of the Borrower or any other person), the Indebtedness to which
such payment was applied shall for the purpose of this guaranty be deemed to
have continued in existence, notwithstanding such application, and this guaranty
shall be enforceable as to such Indebtedness as fully as if such application had
never been made.
The undersigned waives: (1) notice of acceptance of this guaranty and
of the creation and existence of the Indebtedness; (2) presentment, demand for
payment, notice of dishonor, notice of nonpayment, and protest of any instrument
evidencing the Indebtedness; and (3) all other demands and notices to the
undersigned or any other person and all other actions to establish the liability
of the undersigned hereunder. The undersigned consents to the personal
jurisdiction of the state and federal courts located in the State of Minnesota
in connection with any controversy related to this guaranty, waives any argument
that venue in such forums is not convenient, and agrees that any litigation
initiated by the undersigned against the Lender in connection with this guaranty
shall be venued in either the District Court of Dakota or Hennepin County,
Minnesota, or the United States District Court, District of Minnesota.
All property of the undersigned, now or hereafter in the possession,
control or custody of or in transit to the Lender for any purpose, including
without limitation the balance of every account of the undersigned with and each
claim of the undersigned against the Lender, shall be subject to a lien and
security interest in favor of the Lender, as security for all liabilities of the
undersigned to the Lender, and shall be subject to be set off against any and
all such liabilities, and the Lender may at any time and from time to time at
its option and without notice appropriate and apply any such property toward the
payment of any and all such liabilities. The undersigned agrees to promptly
provide the Lender from time to time with financial statements of the
undersigned, in form and substance acceptable to the Lender, at least once every
12 months and as otherwise requested by the undersigned agrees to promptly
provide the Lender, from time to time with such other information respecting the
condition (financial and otherwise), business and property of the undersigned as
the Lender may request, in form and substance acceptable to the Lender.
The undersigned waives all claims, rights and remedies which the
undersigned may now have or hereafter acquire against any person at any time now
or hereafter liable for payment of any of the Indebtedness and as to any
collateral security, including but not limited to all claims, rights and
remedies of contribution, indemnification, exoneration, reimbursement, recourse
and subrogation, whether or not such claim, right or remedy arises in equity,
under contract, by statute, under common law or otherwise, until the
Indebtedness has been fully paid. No waiver of any rights hereunder, and no
modification or amendment of this guaranty shall be effective unless the same is
in writing duly executed by the Lender, and each such waiver, if any, shall
apply only with respect to the specific instance involved and shall not impair
or affect the rights of the Lender or the provisions of this guaranty in any
other respect at any other time. This guaranty shall continue until written
notice of revocation of this guaranty, executed by the undersigned, has been
received by the Lender; provided, no revocation of this guaranty shall affect in
any manner any liability of the undersigned under this guaranty with respect to
Indebtedness arising before the Lender receives such written notice of
revocation, and the sole effect of revocation of this guaranty shall be to
exclude from this guaranty Indebtedness thereafter arising which is unconnected
with Indebtedness theretofore arising or transactions theretofore entered into.
Any invalidity or unenforceability of any provision or application of
this guaranty shall not affect other lawful provisions and applications hereof
and to this end the provisions of this guaranty are declared to be severable.
This guaranty shall bind the undersigned and the heirs, representatives,
successors and assigns of the undersigned, and of each of them respectively, and
shall benefit the Lender, its successors and assigns. This guaranty shall be
governed by and construed in accordance with the laws of the State of Minnesota.
THE UNDERSIGNED REPRESENTS, CERTIFIES, WARRANTS AND AGREES THAT THE
UNDERSIGNED HAS READ ALL OF THIS GUARANTY AND UNDERSTANDS ALL OF THE PROVISIONS
OF THIS GUARANTY. THE UNDERSIGNED ALSO AGREES THAT COMPLIANCE BY THE LENDER WITH
THE EXPRESS PROVISIONS OF THIS GUARANTY SHALL CONSTITUTE GOOD FAITH AND SHALL BE
CONSIDERED REASONABLE FOR ALL PURPOSES.
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