EXHIBIT 10.4
CONTINUING PERSONAL GUARANTY
FOR VALUE RECEIVED, and in consideration of any lease, capital lease,
loan, or other financial accommodation heretofore or hereafter at any time made
or granted to MOBILE PET SYSTEMS, INC., a Delaware corporation ("Lessee"), by
FINOVA CAPITAL CORPORATION ("Lessor"), the undersigned, XXXX X. XXXXX
("Guarantor"), hereby agrees as follows:
1. GUARANTY OF OBLIGATIONS. (a) Guarantor unconditionally, absolutely
and irrevocably guarantees the full and prompt payment and performance when due,
whether by acceleration or otherwise, and at all times thereafter, of all
obligations of Lessee to Lessor, howsoever created, arising or evidenced,
whether direct or indirect, absolute or contingent, or now or hereafter existing
or due or to become due, including, without limitation, under or in connection
with that certain Equipment Lease No. 4125 of even date herewith by and between
Lessee and Lessor (the "Lease"), and each of the documents, instruments and
agreements executed and delivered in connection therewith, but solely with
respect to those items of equipment which are included on Lease Schedule No.
4125.01 attached to the Lease, as each may be modified, amended, supplemented or
replaced from time to time (all such obligations are herein referred to
collectively as the "Liabilities", and the Lease and all other documents
evidencing or securing any of the Liabilities are herein referred to,
collectively, as the "Lease Documents"). This Continuing Personal Guaranty (this
"Continuing Guaranty") is a guaranty of payment and performance when due and not
of collection. Terms used herein with initial capital letters, which are not
otherwise defined herein, shall have the meanings given such terms in the Lease.
(b) In the event of any default by Xxxxxx in making payment of, or
default by Xxxxxx in performance of, any of the Liabilities, Guarantor agrees
on demand by Xxxxxx to pay and perform all of the Liabilities as are then or
thereafter become due and owing or are to be performed under the terms of the
Lease Documents. Guarantor further agrees to pay all expenses (including
reasonable attorneys' fees and expenses) paid or incurred by Lessor in
endeavoring to collect the Liabilities, or any part thereof, and in enforcing
this Continuing Guaranty (herein, the "Collection Costs").
2. CONTINUING NATURE OF GUARANTY AND LIABILITIES. This Continuing
Guaranty shall be continuing and shall not be discharged, impaired or affected
by:
a. the insolvency of Lessee or the payment in full of all of
the Liabilities at any time or from time to time;
b. the power or authority or lack thereof of Lessee to incur
the Liabilities;
c. the validity or invalidity of any of the Lease Documents or
the documents securing the same;
d. the existence or non-existence of Lessee as a legal entity;
e. any transfer by Lessee of all or any part of any collateral
in which Lessor has been granted a lien or security
interest pursuant to the Lease Documents;
f. any statute of limitations affecting the liability of
Guarantor under this Continuing Guaranty or the Lease
Documents or the ability of Lessor to enforce this
Continuing Guaranty or any provision of the Lease
Documents; or
g. any right of offset, counterclaim or defense of Guarantor,
including, without limitation, those which have been waived
by Guarantor pursuant to Section 7 hereof.
3. INSOLVENCY OF LESSEE OR GUARANTOR. Without limiting the
generality of any other provision hereof, Xxxxxxxxx agrees that, in the event of
the dissolution or insolvency of Lessee or Guarantor or the inability of Lessee
or Guarantor to pay their respective debts as they mature, or an assignment by
Lessee or Guarantor for the benefit of creditors, or the institution of any
proceeding by or against Lessee or Guarantor alleging that Lessee or Guarantor
is insolvent or unable to pay their respective debts as they mature, Guarantor
will pay to Lessor forthwith the full amount which would be payable hereunder by
Guarantor if all of the Liabilities were then due and payable, whether or not
such event occurs at a time when any of the Liabilities are otherwise due and
payable.
4. PAYMENT OF THE LIABILITIES. Any amounts received by Lessor from
whatever source on account of the Liabilities may be applied by Lessor toward
the payment of such of the Liabilities, and in such order of application, as
Lessor may from time to time elect, and notwithstanding any payments made by or
for the account of Guarantor pursuant to this Continuing Guaranty.
5. REINSTATEMENT. Guarantor agrees that, if at any time all or any
part of any payment theretofore applied by Lessor to any of the Liabilities is
or must be rescinded or returned by Lessor for any reason whatsoever (including,
without limitation, the insolvency, bankruptcy or reorganization of Lessee),
such Liabilities shall, for the purposes of this Continuing Guaranty and to the
extent that such payment is or must be rescinded or returned, be deemed to have
continued in existence notwithstanding such application by Xxxxxx, and this
Continuing Guaranty shall continue to be effective or be reinstated, as the case
may be, as to such Liabilities, all as though such application by Lessor had not
been made.
6. PERMITTED ACTIONS OF LESSOR. Lessor may from time to time, in its
sole discretion and without notice to Guarantor, take any or all of the
following actions:
2
a. retain or obtain a security interest in any assets of
Lessee or any third party to secure any of the Liabilities or any
obligations of Guarantor hereunder;
b. retain or obtain the primary or secondary obligation of any
obligor or obligors, in addition to Guarantor, with respect to any of the
Liabilities;
c. extend or renew for one or more periods (whether or not
longer than the original period), alter or exchange any of the
Liabilities;
x. xxxxx, ignore or forbear from taking action or otherwise
exercising any of its default rights or remedies with respect to any
default by Lessee under the Lease Documents;
e. release, waive or compromise any obligation of Guarantor
hereunder or any obligation of any nature of any other obligor primarily
or secondarily obligated with respect to any of the Liabilities;
f. release its security interest in, or surrender, release or
permit any substitution or exchange for, all or any part of any
collateral now or hereafter securing any of the Liabilities or any
obligation hereunder, or extend or renew for one or more periods (whether
or not longer than the original period) or release, waive, compromise,
alter or exchange any obligations of any nature of any obligor with
respect to any such property; and
g. demand payment or performance of any of the Liabilities
from Guarantor at any time or from time to time, whether or not Lessor
shall have exercised any of its rights or remedies with respect to any
property securing any of the Liabilities or any obligation hereunder or
proceeded against any other obligor primarily or secondarily liable for
payment or performance of any of the Liabilities.
7. SPECIFIC WAIVERS. Without limiting the generality of any other
provision of this Continuing Guaranty, Guarantor hereby expressly waives:
a. notice of the acceptance by Lessor of this Continuing
Guaranty;
b. notice of the existence, creation, payment, nonpayment,
performance or nonperformance of all or any of the Liabilities;
c. presentment, demand, notice of dishonor, protest, notice of
protest and all other notices whatsoever with respect to the
payment or performance of the Liabilities or the amount thereof or
any payment or performance by Guarantor hereunder;
3
d. all diligence in collection or protection of or
realization upon the Liabilities or any thereof, any
obligation hereunder or any security for or guaranty of any
of the foregoing;
e. any right to direct or affect the manner or timing
of Lessor's enforcement of its rights or remedies;
f. any and all defenses which would otherwise arise
upon the occurrence of any event or contingency described
in Section 1 hereof or upon the taking of any action by
Xxxxxx permitted hereunder;
g. any defense, right of set-off, claim or counterclaim
whatsoever and any and all other rights, benefits,
protections and other defenses available to Guarantor now
or at any time hereafter, including, without limitation,
under California Civil Code Sections 2787 to 2855,
inclusive, and California Code of Civil Procedure Sections
580a, 580b, 580d or 726, and all successor sections; and
h. all other principles or provisions of law, if any,
that conflict with the terms of this Continuing Guaranty,
including, without limitation, the effect of any
circumstances that may or might constitute a legal or
equitable discharge of a guarantor or surety.
8. IRREVOCABILITY. Guarantor hereby further waives all rights
to revoke this Continuing Guaranty at any time, and all rights to revoke any
agreement executed by Guarantor at any time to secure the payment and
performance of Guarantor's obligations under this Continuing Guaranty.
9. STATUTORY WAIVER OF RIGHTS AND DEFENSES REGARDING ELECTION
OF REMEDIES. Guarantor waives all rights and defenses arising out of an
election of remedies by Xxxxxx, even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for a guaranteed obligation,
has destroyed Guarantor's rights of subrogation and reimbursement against Lessee
by the operation of any applicable law, including without limitation Section
580d of the California Code of Civil Procedure, or otherwise.
10. SUBORDINATION. Guarantor hereby subordinates any and
all indebtedness of Lessee to Guarantor to the full and prompt payment and
performance of all of the Liabilities. Guarantor agrees that Lessor shall be
entitled to receive payment of all Liabilities prior to Guarantor's receipt
of payment of any amount of any indebtedness of Lessee to Guarantor. Any
payments on such indebtedness to Guarantor, if Lessor so requests, shall be
collected, enforced and received by Guarantor, in trust, as trustee for
Lessor and shall be paid over to Lessor on account of the Liabilities, but
without reducing or affecting in any manner the liability of Guarantor under
the other provisions of this Guaranty. Lessor is authorized and empowered,
but not obligated, in its discretion, (a) in the name of Guarantor, to
collect and enforce, and to submit claims in respect of, any indebtedness of
4
Lessee to Guarantor and to apply any amounts received thereon to the
Liabilities, and (b) to require Guarantor (i) to collect and enforce, and to
submit claims in respect of, any indebtedness of Lessee to Guarantor, and (ii)
to pay any amounts received on such indebtedness to Lessor for application to
the Liabilities.
11. SUBROGATION. Guarantor will not exercise any rights which
it may acquire by way of subrogation under this Continuing Guaranty, by any
payment hereunder or otherwise, until all of the Liabilities have been paid in
full, in cash, and Lessor shall have no further obligations to Lessees under the
Lease Documents or otherwise. If any amount shall be paid to Guarantor on
account of such subrogation rights at any other time, such amount shall be held
in trust for the benefit of Lessor and shall be forthwith paid to Lessor to be
credited and applied to the Liabilities, whether matured or unmatured, in such
manner as Lessor shall determine in its sole discretion.
12. ASSIGNMENT OF LESSOR'S RIGHTS. Lessor may, from time to
time, without notice to Guarantor, assign or transfer any or all of the
Liabilities or any interest therein and, notwithstanding any such assignment
or transfer of the Liabilities or any subsequent assignment or transfer
thereof, the Liabilities shall be and remain the Liabilities for the purpose
of this Continuing Guaranty. Each and every immediate and successive assignee
or transferee of any of the Liabilities or of any interest therein shall, to
the extent of such party's interest in the Liabilities, be entitled to the
benefits of this Continuing Guaranty to the same extent as if such assignee
or transferee were Lessor; PROVIDED, HOWEVER, that unless Lessor shall
otherwise consent in writing, Lessor shall have an unimpaired right, prior
and superior to that of any such assignee or transferee, to enforce this
Continuing Guaranty for its own benefit as to those of the Liabilities which
Lessor has not assigned or transferred.
13. INDULGENCES NOT WAIVERS. No delay in the exercise of any
right or remedy shall operate as a waiver thereof, and no single or partial
exercise by Lessor of any right or remedy shall preclude other or further
exercise thereof or the exercise of any other right or remedy; nor shall any
modification or waiver of any of the provisions of this Continuing Guaranty be
binding upon Lessor, except as expressly set forth in a writing duly signed and
delivered by Lessor. No action of Xxxxxx permitted hereunder shall in any way
affect or impair the rights of Lessor or the obligations of Guarantor under this
Continuing Guaranty.
14. FINANCIAL CONDITION OF LESSEE. (a) Guarantor represents
and warrants that it is fully aware of the financial condition of Lessee, and
Guarantor delivers this Continuing Guaranty based solely upon its own
independent investigation of Xxxxxx's financial condition and in no part upon
any representation or statement of Lessor with respect thereto. Guarantor
further represents and warrants that it is in a position to and hereby does
assume full responsibility for obtaining such additional information concerning
Xxxxxx's financial condition as Guarantor may deem material to its obligations
hereunder, and Guarantor is not relying upon, nor expecting Lessor to furnish it
any information in Lessor's
5
possession concerning Xxxxxx's financial condition or concerning any
circumstances bearing on the existence or creation, or the risk of nonpayment or
nonperformance of the Liabilities.
(b) Without limiting the generality of Section 14(a) above,
Guarantor hereby waives any duty on the part of Lessor to disclose to
Guarantor any facts it may now or hereafter know about Lessee, regardless of
whether Lessor has reason to believe that any such facts materially increase
the risk beyond that which Guarantor intends to assume or has reason to
believe that such facts are unknown to Guarantor. In addition, Guarantor
hereby knowingly accepts the full range of risk encompassed within a contract
of "Continuing Guaranty" which includes, without limitation, the possibility
that Xxxxxx will contract for additional indebtedness for which Guarantor may
be liable hereunder after Xxxxxx's financial condition or ability to pay its
lawful debts when they fall due has deteriorated.
15. REPRESENTATIONS AND WARRANTIES. Guarantor represents and
warrants to Lessor that each of the following statements is accurate and
complete as of the date of this Continuing Guaranty:
a. this Continuing Guaranty has been duly executed and
delivered by Guarantor and constitutes a legal, valid and binding
obligation of Guarantor, enforceable against Guarantor in
accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to or
affecting the enforcement of creditors' rights generally;
b. the execution, delivery and performance of this
Continuing Guaranty do not (i) violate any provisions of law or
any order of any court or other agency of government (each, a
"Requirement of Law"), (ii) contravene any provision of any
material contract or agreement to which Guarantor is a party or by
which Guarantor or Guarantor's assets are bound (each, a
"Contractual Obligation"), or (iii) result in the creation or
imposition of any lien, charge or encumbrance of any nature upon
any property, asset or revenue of Guarantor;
c. all consents, approvals, orders and authorizations
of, and registrations, declarations and filings with, any
governmental agency or authority or other person or entity
(including, without limitation, the members, shareholders or
partners of any entity), if any, which are required to be obtained
in connection with the execution and delivery of this Continuing
Guaranty or the performance of Guarantor's obligations hereunder
have been obtained, and each is in full force and effect;
d. Guarantor has paid all taxes and other charges
imposed by any governmental agency or authority due and payable by
Guarantor other than those which are being challenged in good
faith by appropriate proceedings;
6
e. Guarantor is not in violation of any Requirement of
Law or Contractual Obligation other than any violation the
consequences of which could not have a material adverse effect on
Guarantor's ability to perform its obligations hereunder
(a "Material Adverse Effect"); and
f. no action, proceeding, investigation or litigation
is pending or, to the knowledge of Grantor, overtly threatened
against Guarantor by any person or entity which, if adversely
determined, could have a Material Adverse Effect.
16. GUARANTOR FINANCIAL INFORMATION. Guarantor will provide
Lessor in writing such financial and other information with respect to
Guarantor's assets and liabilities as Lessor shall reasonably request from time
to time, in form satisfactory to Lessor.
17. BINDING UPON SUCCESSORS; DEATH OF XXXXXXXXX. This
Continuing Guaranty shall be binding upon Guarantor and Guarantor's successors
and assigns and shall inure to the benefit of Lessor and its successors and
assigns. All references herein to Lessee shall be deemed to include its
successors and assigns, and all references herein to Guarantor shall be deemed
to include Guarantor named herein, it's successors and assigns, and in the event
of a death of a Guarantor, the duly appointed representative, executor or
administrator of the deceased Guarantor's estate.
18. OBLIGATIONS JOINT AND SEVERAL. In addition and
notwithstanding anything to the contrary contained in this Continuing
Guaranty or in any other document, instrument or agreement between or among
any of Lessor, Lessee, Guarantor or any third party, the obligations of
Guarantor with respect to the Liabilities shall be joint and several with any
other person or entity that now or hereafter executes a guaranty of any of
the Liabilities separate from this Continuing Guaranty.
19. NOTICES. All notices required or permitted to be given
hereunder shall be in writing and shall be either personally delivered,
transmitted by facsimile to the facsimile numbers provided herein or sent by
United States certified or registered mail, return receipt requested, addressed
to Guarantor or Lessor at their respective addresses stated below or at such
other address as either party hereafter notifies the other party as herein
provided. Notices shall be deemed received on the earlier of (i) the date noted
on the return receipt as delivered if mail delivery of the notice is successful
or the date inscribed on a confirmation of successful transmission, if sent by
facsimile; (ii) the last date of attempted delivery, as noted by the United
States Postal Service on the envelope containing the notice, if mail delivery is
unsuccessful; or (iii) the date of the actual delivery if personally delivered.
20. GOVERNING LAW; ADDITIONAL WAIVERS. (a) This Continuing Guaranty
has been delivered and shall be governed by and construed in accordance with the
internal laws (as opposed to the conflicts of law provisions) of the State of
Arizona, provided that
7
Guarantor agrees that each of the waivers and agreements of Guarantor herein
which refer to provisions of the California Civil Code and the California Code
of Civil Procedure shall be effective and enforceable to the extent permitted
under applicable law, and to the extent that any court of competent jurisdiction
shall apply the laws of the State of California to determine the relative rights
or remedies of Lessor and Guarantor hereunder, such waivers and agreements by
Guarantor shall be governed by the laws of the State of California.
(b) GUARANTOR HEREBY:
(i) WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION TO
ENFORCE OR DEFEND ANY MATTER ARISING FROM OR RELATED TO THIS CONTINUING
GUARANTY, AND ACKNOWLEDGES THAT XXXXXX ALSO WAIVES SUCH RIGHT;
(ii) IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY STATE
OR FEDERAL COURT LOCATED IN MARICOPA COUNTY, ARIZONA, OVER ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY MATTER ARISING FROM OR RELATED TO
THIS CONTINUING GUARANTY;
(iii) IRREVOCABLY WAIVES, TO THE FULLEST EXTENT GUARANTOR
MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING;
(iv) agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in any other
jurisdictions by suit on the judgment or in any other manner provided
by law; and
(v) agrees not to institute any legal action or
proceeding against Lessor or any of Xxxxxx's directors, officers,
employees, agents or property concerning any matter arising out of or
relating to this Continuing Guaranty in any court other than one located
in Maricopa County, Arizona.
(c) Nothing herein shall affect or impair Xxxxxx's right to
serve legal process in any manner permitted by law or Lessor's right to bring
any action or proceeding against Guarantor or its property in the courts of any
other jurisdiction. Wherever possible each provision of this Continuing Guaranty
shall be interpreted as to be effective and valid under applicable law, but if
any provision of this Continuing Guaranty shall be prohibited by or invalid
under such law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Continuing Guaranty.
21. ADVICE OF COUNSEL. GUARANTOR ACKNOWLEDGES THAT GUARANTOR
HAS EITHER OBTAINED THE ADVICE OF COUNSEL OR HAS
8
HAD THE OPPORTUNITY TO OBTAIN SUCH ADVICE IN CONNECTION WITH THE TERMS AND
PROVISIONS OF THIS CONTINUING GUARANTY.
22. ENTIRE AGREEMENT. This Continuing Guaranty contains the
complete understanding of the parties hereto with respect to the subject
matter herein. Guarantor acknowledges that Guarantor is not relying upon any
statements or representations of Lessor not contained in this Continuing
Guaranty and that such statements or representations, if any, are of no force
or effect and are fully superseded by this Continuing Guaranty. This
Continuing Guaranty may only be modified by a writing executed by Xxxxxxxxx
and Xxxxxx.
23. CONSIDERATION. Guarantor is a founder of and shareholder in
Lessee, and as such stands to benefit economically and materially from Lessee's
ability to successfully operate its business. The accommodations being provided
by Lessor to Lessee pursuant to the Lease represent Xxxxxx's first acquisition
of the assets necessary to operate it's business. Accordingly, Guarantor
acknowledges the receipt of full and adequate consideration in return for this
Continuing Guaranty through the economic benefits Guarantor expects to derive as
a result of his ownership interest in Xxxxxx.
24. TERMINATION OF CONTINUING GUARANTY. In connection with
the execution and delivery of the Lease, Guarantor acknowledges and agrees
that he has, both on behalf of Xxxxxx and on behalf of himself individually,
petitioned Lessor to enter into the Lease and to provide the financial
accommodations created thereby in order to induce the manufacturer of the
Equipment listed on Lease Schedule No. 4125.01 to the Lease to make such
Equipment available to Lessee at this time, notwithstanding the fact that at
the time the Lease is being entered into, all conditions precedent to
Xxxxxx's commitment to enter into the Lease have not been satisfied. Xxxxxx
has agreed to enter into the Lease at this time, conditioned upon Guarantor's
execution and delivery of this Continuing Guaranty in favor of Xxxxxx. Lessor
hereby agrees that, notwithstanding anything to the contrary contained
herein, but provided that no default under the Lease then exists, this
Continuing Guaranty shall be terminated and released (subject to
reinstatement in accordance with Section 5 hereof) at such time as Lessee has
provided to Lessor documentation substantiating that, with respect to the
specific items of Equipment listed on Schedule 1 to the Lease, Lessee has in
effect signed, valid and enforceable contractual agreements (each of which
must be in form and substance satisfactory to Lessor) with one or more
hospitals (the creditworthiness of which must be satisfactory to Lessor in
all respects), which agreements will provide Lessee with a minimum of
eighty-eight (88) positron emission tomography ("PET") procedures per month,
for a term that shall not expire prior to the date final payment is due under
the Lease, with respect to the items of Equipment listed on Lease Schedule
No. 4125.01 to the Lease. Lessor shall be entitled to perform its own due
diligence with respect to each hospital which is to become party to any such
contract, to determine whether such hospital is satisfactorily creditworthy,
in Xxxxxx's sole discretion.
9
IN WITNESS WHEREOF, Xxxxxxxxx has executed this Continuing
Guaranty effective as of the 8th day of April, 1999.
"Guarantor"
XXXX X. XXXXX
/s/ Xxxx X. Xxxxx
--------------------------------------
Social Security #: ###-##-####
--------------------
Guarantor's address for notices:
000 X Xxxxxx Xxxxxx Xxxxx
--------------------------------------
San Diego, CA
--------------------------------------
Facsimile:
000-000-0000
----------------------------
Xxxxxx's address for notices:
FINOVA Capital Corporation
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
10
