GUARANTY
EXECUTION
COPY
THIS GUARANTY, made March 31,
2009 by XXXXX.XXX HOLDINGS,
INC., a Delaware corporation with a principal place of business located
at 0000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000 (the “Guarantor”), in favor
of MBRO CAPITAL, LLC, a
Connecticut limited liability company with a principal place of business located
at 000 Xxxxx Xxxxx, Xxx Xxxxxx, Xxxxxxxxxxx 00000 (the "Lender").
Recitals
A. The
Lender extended to Xxxxx.xxx Group, Inc., a Delaware corporation (the "Borrower") a
$1,000,000 commercial term loan facility (the "Loan") pursuant to
the terms of the $1,000,000 Commercial Term Promissory Note of this date (the
"Note") from
the Borrower to the Lender and the Commercial Term Loan Agreement of this date
between the Borrower and the Lender (the “Loan Agreement”) (the
Note, the Loan Agreement and all other documents executed in connection
therewith are collectively referred to as the “Loan
Documents”).
B. The
Guarantor is a wholly-owned subsidiary of the Borrower and will receive direct
financial benefit by reason of the Loan.
C. The
Lender has requested and the Guarantor has agreed to unconditionally guaranty to
the Lender the repayment and performance of all indebtedness, liabilities and
obligations of the Borrower to the Lender including, but not limited to, the
liabilities and obligations arising under the Note and all other Loan Documents
executed in connection therewith.
Agreement
In
consideration of the Recitals, which are incorporated by reference and the
representations, covenants and warranties contained herein, the parties
intending to be bound legally, agree as follows:
1. Guaranty. The
Guarantor unconditionally guaranties the punctual payment when due, whether at
stated maturity, by acceleration or otherwise, of all obligations of the
Borrower to the Lender whether now or hereafter existing including, but not
limited to, the obligations of the Borrower under the Note and under any
amendment, modification, renewal, extension, substitution or replacement thereof
or thereto, whether for principal, interest, fees, expenses or otherwise and any
and all expenses incurred by the Lender in enforcing any rights under this
Guaranty (such obligations being referred to collectively as the "Obligations").
2. Guaranty
Absolute. (a) The Guarantor guaranties that the Obligations
will be paid strictly in accordance with the terms of the Note regardless of any
law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Lender with respect
thereto. The liability of the Guarantor under this Guaranty shall be
absolute and unconditional irrespective of:
(i)
any lack of validity or enforceability of the Note or any other agreement or
instrument relating thereto;
(ii)
any change in the time, manner or place of payment of, or in any other term of,
all or any of the Obligations, or any other amendment or waiver of or any
consent to departure from the Note;
(iii) any
exchange, release or non-perfection of any collateral, or any release or
amendment or waiver of or consent to departure from any other guaranty, for all
or any of the Obligations; or
(iv)
any other circumstances which might otherwise constitute a defense available to,
or a discharge of, the Borrower in respect of the Obligations or the Guarantor
in respect of this Guaranty.
(b) This
Guaranty shall continue to be effective or be reinstated, as the case may be, if
at any time any payment of any of the Obligations is rescinded or must otherwise
be returned by the Lender upon the insolvency, bankruptcy or reorganization of
the Borrower or otherwise, all as though such payment had not been
made.
3. Waiver. The
Guarantor waives promptness, diligence, notice of acceptance, notice of
presentment, demand or protest and any other notice with respect to any of the
Obligations and this Guaranty and any requirement that the Lender exhaust any
right or take any action against the Borrower or any other person or entity or
any collateral.
4. Subrogation;
Contribution. The Guarantor will not exercise any rights which
it may acquire by way of subrogation under this Guaranty, by any payment made
hereunder or otherwise, until all the Obligations shall have been paid in
full. If any amount shall be paid by the Guarantor on account of such
subrogation rights or by way of contribution or indemnification at any time when
all the Obligations shall not have been paid in full, such amount shall be held
in trust for the benefit of the Lender and shall forthwith be paid to the Lender
to be credited and applied upon the Obligations, whether matured or unmatured,
in accordance with the terms of the Note. If the Guarantor shall make
payment to the Lender of all or any part of the Obligations and all the
Obligations shall be paid in full, the Lender will execute and deliver to the
Guarantor appropriate documents, without recourse and without representation or
warranty, necessary to evidence the transfer by subrogation to the Guarantor of
an interest in the Obligations resulting from such payment by the
Guarantor.
5. Representations and
Warranties. The Guarantor represents and warrants to the
Lender as follows:
(a) The
Guarantor is a corporation duly organized, validly existing and in good standing
under the laws of the state indicated at the beginning of this
Guaranty.
(b) The
Guarantor is qualified as a foreign corporation in each state in which the
character of its properties or the nature of its business requires.
(c) The
execution, delivery and performance by the Guarantor of this Guaranty has been
duly authorized by all necessary corporate actions and does not and will
not:
(i) contravene
the Guarantor’s Certificate of Incorporation or By-Laws;
(ii) violate
any provision of any law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award presently in effect having applicability to the
Guarantor;
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(iii) result
in a breach of or constitute a default under any indenture or loan or credit
agreement or any other material agreement, lease or instrument to which the
Guarantor is a party or by which it or its respective properties may be bound or
affected;
(iv) result
in, or require, the creation or imposition of any mortgage, deed of trust,
pledge, lien, security interest or other charge or encumbrance of any nature
(other than arising under any document delivered to the Lender in connection
herewith) upon or with respect to any of the properties now owned or hereafter
acquired by the Guarantor; and the Guarantor is not in default under any such
law, rule, regulation, order, writ, judgment, injunction, decree, determination
or award or any such indenture, agreement, lease or instrument; or
(v) with
respect to the execution and delivery of this Guaranty, render the Guarantor
insolvent. For purposes hereof, “insolvent” means the failure of the
Guarantor to pay its debts as they become due.
(d) No
authorization or approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution,
delivery and performance by the Guarantor of this Guaranty.
(e) This
Guaranty is the legal, valid and binding obligation of the Guarantor,
enforceable against the Guarantor in accordance with its terms.
(f) The
Guarantor is presently solvent. For purposes hereof, “solvent” means
that the Guarantor is able to pay its debts as they become due.
(g) Except
as set forth in Schedule 5(e) to the Loan Agreement, there is no pending or
threatened action or proceeding affecting the Guarantor before any court,
governmental agency or arbitrator which may materially and adversely affect the
financial condition of the Guarantor.
(h) The
Guarantor has filed all tax returns or has an approved extension (federal, state
and local) required to be filed and has paid all taxes shown thereon to be due,
including interest and penalties.
(i) There
is no pending or threatened action or proceeding affecting the Guarantor before
any court, governmental agency or arbitrator which may materially and adversely
affect the financial condition or operations of the Guarantor.
(j) No
information, exhibit or report furnished by the Guarantor to the Lender in
connection with the negotiation of this Guaranty, or any other Loan Documents
contains or contained any material misstatement of fact or omitted to state a
material fact necessary to make the statements contained therein not
misleading.
6. Reporting
Requirements. Subject to the terms of a confidentiality
agreement to be entered into between the Lender and the Guarantor, so long as
any part of the Obligations shall remain unpaid, the Guarantor shall furnish to
the Lender:
(a) promptly
after the commencement thereof, notice of all actions, suits and proceedings
before any court or governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign, affecting the Guarantor;
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(b) promptly
upon becoming aware of any default, or any occurrence but for the giving of
notice or the passage of time would constitute an Event of Default, the
Guarantor shall notify the Lender thereof in writing; and
(c) such
other information respecting the condition or operations, financial, business or
otherwise, of the Guarantor as the Lender may from time to time reasonably
request.
7. Continuing Guaranty;
Transfer of Note. This Guaranty is a continuing guaranty and
shall:
(a) remain
in full force and effect until payment in full of the Obligations and all other
amounts payable under this Guaranty;
(b) be
binding upon the Guarantor, its successors and assigns; and
(c) inure
to the benefit of and be enforceable by the Lender, and its respective
successors, transferees and assigns.
Without
limiting the generality of the foregoing clause (c), the Lender may assign or
otherwise transfer the Note or any of the Obligations held by it to any other
person or entity, and such other person or entity shall thereupon become vested
with all the rights in respect thereof granted to the Lender herein or
otherwise.
8. Amendments. No
amendment or waiver of any provision of this Guaranty and no consent to any
departure by the Guarantor therefrom shall in any event be effective unless the
same shall be in writing and signed by the Lender and the
Guarantor.
9. Addresses for
Notices. Any notice provided for under this Agreement shall be in writing
and shall be effective upon receipt or upon failure of the addressee to accept
delivery if and when mailed by registered or certified mail, postage prepaid, or
express parcel service, addressed to such party at such address. Any
party and any representative designated below may, by notice to the other in the
manner provided herein, change its address for receiving such
notices. All notices and consents on behalf of any party hereto shall
be signed by such party and shall be sent:
If to the
Guarantor:
Xxxxx.xxx
Holdings, Inc.
0000 Xxxxx Xxxxxxx Xxxxxxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Chief Executive
Officer
With a
copy to:
Rele & Xxxxxx
000 Xxxxxx Xxxxxx
Xxxxx
0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx,
Esq.
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If to the
Lender:
MBRO
Capital, LLC
000 Xxxxx
Xxxxx
Xxx
Xxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxxx
X. Xxxxxxx
With a
copy to:
Xxxxxxx
Xxxxxx X’Xxxxxx & Xxxxxxxxxxx LLP
Xxx
Xxxxxxxx Xxxxxx
Xxxxxxxx,
Xxxxxxxxxxx 00000
Attention: Xxxxx
X. Xxxxxx, Esq.
10. Severability.
If any clause or provision of this Guaranty is determined to be illegal, invalid
or unenforceable under any present or future law by the final judgment of a
court of competent jurisdiction, the remainder of this Guaranty will not be
affected thereby. It is the intention of the parties that if any such
provision is held to be illegal, invalid or unenforceable, there will be added
in lieu thereof, a provision as similar in terms to such provision as is
possible and be legal, valid and enforceable.
11. Right of
Set-Off. The Lender shall have a lien on the balances of the
Guarantor now or hereafter on deposit with or held as custodian by the Lender
and the Lender shall have full authority to set off such balances against the
indebtedness evidenced by this note or any other Obligation of the Guarantor,
and may at any time, without notice to the extent permitted by law, apply the
same to the indebtedness evidenced by this guaranty or such other Obligations,
whether due or not.
12. Headings. Section
headings are for convenience of reference only, and shall not affect the
interpretation or meaning of any provision of this Guaranty.
13. Entire
Agreement. This Guaranty constitutes the entire agreement
between the parties, and supersedes all prior discussions and negotiations
relating to the subject matter hereof. The terms of this Guaranty
cannot be changed or terminated orally, and shall be deemed effective as of the
date accepted by the Lender by its duly authorized officer. This
Guaranty may not be amended or terminated except by a writing signed by the
party against whom enforcement thereof is sought.
14. Successors and
Assigns. This Guaranty shall bind and inure to the benefit of
the parties hereto and their respective successors and assigns; provided,
however, that the Guarantor shall not assign this Guaranty, or any related
document, or any of its rights without the prior written consent of the
Lender.
15. Failure or Delay not a
Waiver. No delay or omission by the Lender to exercise any
right hereunder shall impair any such right, and any such delay or omission
shall not be construed to be a waiver thereof. A waiver of any single
breach of default hereunder shall not be deemed a waiver of any other breach or
default. Any waiver, amendment to, consent or approval under this
Guaranty by the Lender must be in writing to be effective and must be signed by
the Lender.
16. Governing Law; Consent to
Jurisdiction. This Guaranty shall be governed by and construed
in accordance with the laws of the State of Connecticut. The
Guarantor agrees that any suit, action or other legal proceeding arising out of
this Guaranty may be brought in the courts of record of the State of Connecticut
or the courts of the United States located in Connecticut. The
Guarantor expressly submits and consents in advance to such jurisdiction in any
action or proceeding.
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17. Other
Guarantors. The Guarantor acknowledges that other individuals
or entities may also guaranty the liabilities of the Borrower (the “Other Guarantors”)
and that it is unconditionally delivering this Guaranty to the
Lender. The Guarantor further acknowledges that the failure of any of
the Other Guarantors to execute and deliver their respective guaranties or the
discharge of any of the Other Guarantors of their respective guarantied
obligations shall not discharge the liability of the Guarantor.
18. Prejudgment Remedy
Waiver. THE GUARANTOR ACKNOWLEDGES THAT THIS GUARANTY IS A
PART OF A COMMERCIAL TRANSACTION AND WAIVES ITS RIGHTS TO NOTICE AND HEARING
UNDER CHAPTER 903a OF THE CONNECTICUT GENERAL STATUTES, OR AS OTHERWISE ALLOWED
BY ANY OTHER STATE OR FEDERAL LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH
THE LENDER MAY DESIRE TO USE, AND FURTHER, WAIVES DILIGENCE, DEMAND, PRESENTMENT
FOR PAYMENT, NOTICE OF NONPAYMENT, PROTEST AND NOTICE OF PROTEST WITH RESPECT TO
THIS GUARANTY. THE GUARANTOR ALSO WAIVES THE RIGHT TO ASSERT IN ANY,
SUIT, ACTION OR PROCEEDING WITH REGARD TO THIS GUARANTY, ANY OFF-SETS OR
COUNTERCLAIMS WHICH THE GUARANTOR MAY HAVE, EXCEPT COMPULSORY
COUNTERCLAIMS. THE GUARANTOR ACKNOWLEDGES THAT IT MAKES THIS WAIVER
KNOWINGLY, VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER EXTENSIVE CONSIDERATION OF
THE RAMIFICATIONS OF THIS WAIVER WITH ITS ATTORNEYS.
19. Jury Trial
Waiver. THE GUARANTOR AND THE LENDER MUTUALLY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN
RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS GUARANTY OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN
CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER WRITTEN OR VERBAL) OR ANY ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES
A MATERIAL INDUCEMENT FOR THE LENDER TO ACCEPT THIS GUARANTY AND MAKE THE LOAN.
THE GUARANTOR ACKNOWLEDGES THAT IT MAKES THIS WAIVER KNOWINGLY, VOLUNTARILY,
WITHOUT DURESS AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF
THIS WAIVER WITH ITS ATTORNEYS.
[Signature
page follows]
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IN WITNESS WHEREOF, the
Guarantor executed this Guaranty to be effective on March 31, 2009.
Signed in
the presence
of:
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XXXXX.XXX
HOLDINGS, INC.
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By:
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/S/ Xxxx X. Xxxxx
XX
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Name: Xxxx
X. Xxxxx XX
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| Title: Chief Executive Officer | ||||
STATE OF
________________ )
) ss:
COUNTY OF
_____________ )
On this
the ___ day of March, 2009, before me, the undersigned officer, personally
appeared _____________________ who acknowledged himself to be the ______________
of Xxxxx.xxx Holdings, Inc., a corporation, and that he, as such ______________,
being authorized so to do, executed the foregoing instrument for the purposes
therein contained and acknowledged the same to be his free act and deed
individually and as such officer and the free act and deed of the
corporation.
IN
WITNESS WHEREOF, I hereunto set my hand.
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Commissioner
of the Superior Court
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Notary
Public
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My
Commission Expires:
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