EXHIBIT 2.3
LIMITED CONTINUING GUARANTY
(Non-Recourse)
THIS LIMITED CONTINUING GUARANTY (the "GUARANTY") is entered into as of
December 31, 1996 (the "EFFECTIVE DATE") by XXXXXXX XXXXXXXX ("GUARANTOR") in
favor of OSP PUBLISHING, INC., a Delaware corporation ("OSP"). THE LIABILITY
OF GUARANTOR UNDER THIS GUARANTY IS LIMITED PURSUANT TO SECTION 3 BELOW.
Guarantor, in order to induce OSP to consider financial accommodations
granted to Xxxxxxx XxXxxxxx, Inc. ("COMPANY") pursuant to that certain
Promissory Note dated December 31, 1996, and for the benefit of OSP, agrees
as set forth below.
1. RECITALS. This Guaranty is executed and delivered to OSP in connection
with the Promissory Note between Company and OSP dated December 31, 1996.
2. GUARANTY. Guarantor unconditionally guaranties to OSP the timely
(whether as scheduled or upon acceleration) payment and performance by
Company of any obligations under the Promissory Note, together with all costs
and expenses (including reasonable attorney fees and disbursements) incurred
with the enforcement of OSP's rights under this Guaranty. The Guarantor
agrees that the Promissory Note may be extended, amended, modified,
supplemented or renewed, in whole or in part, without notice or further
assent from Guarantor, and that the Guarantor will remain bound by this
Guaranty notwithstanding any extension, renewal or other alteration of the
Promissory Note. Notwithstanding anything to the contrary in this Guaranty,
the parties specifically agree that this Guaranty shall not cover the Pledge,
as defined below, and in the event of a default by Guarantor pursuant to the
Pledge Agreement OSP shall have recourse against Guarantor without the
limitations set forth in this Guaranty.
3. RECOURSE LIMITED TO PLEDGED STOCK AS REFERRED TO IN THE SECURITY PLEDGE
AGREEMENT OF EVEN DATE HEREWITH, EXECUTED BY GUARANTOR, IN FAVOR OF OSP
("PLEDGE"). OSP SHALL ONLY BE ENTITLED TO RESORT TO THE PLEDGED STOCK IN THE
EVENT OSP IS ENTITLED TO ENFORCE ITS RIGHTS AGAINST GUARANTOR UNDER THIS
GUARANTY. OSP'S ONLY SOURCE OF RECOVERY SHALL BE AGAINST THE PLEDGED STOCK
AND GUARANTOR SHALL NOT OTHERWISE BE LIABLE FOR ANY PAYMENTS UNDER THIS
GUARANTY.
4. OSP'S DIRECT RIGHTS.
4.1 GUARANTY OF PAYMENT. This is a guaranty of payment and performance
and is not a guaranty of collection. This Guaranty is irrevocable
and continuing in nature and relates to any obligations pursuant to
the Promissory Note now existing or hereafter arising.
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4.2 DIRECT RIGHTS AGAINST GUARANTOR. In the event that Company fails
timely to pay or perform any of the obligations under the
Promissory Note, OSP may enforce its rights under this Guaranty
without first seeking to obtain payment or performance from Company.
4.3 CLIENT'S BANKRUPTCY. In the event Company becomes subject to a
voluntary or involuntary case under the Bankruptcy Code, as
amended, or under any other bankruptcy or insolvency law, or makes
an assignment for the benefit of creditors, or enters into a formal
or informal moratorium, composition or extension generally with
Company's creditors, OSP may immediately pursue its rights under
this Guaranty, even though OSP may be stayed from accelerating or
collecting the Promissory Note from Company.
4.4 WAIVER OF PRIORITY OF COLLECTION. Guarantor waives any rights
Guarantor may have to require OSP to proceed against the Company
or to pursue any other remedy in OSP's power. In addition,
Guarantor waives Guarantor's right to benefit from every security
which now or hereafter exists for the performance of the Promissory
Note, including any right the Guarantor has to require OSP to
proceed against or exhaust such security. If OSP decides to
proceed first to exercise any other remedy or right, OSP retains
all of OSP's rights under this Guaranty.
4.5 WAIVER OF RELEASE. The Guarantor shall not be discharged, released
or exonerated, in any way, from its absolute, unconditional and
independent liabilities hereunder, even though any rights or
defenses which the Guarantor may have against Company, OSP or
others may be destroyed, diminished or otherwise affected, by:
4.5.1 any declaration by OSP of a default in respect of the
Promissory Note;
4.5.2 the exercise by OSP of any rights or remedies against
Company or any other person;
4.5.3 the failure of OSP to exercise any rights or remedies
against Company or any other person, including without
limitation the failure to perfect security interests
granted by Company or the failure to file a bankruptcy
claim in any bankruptcy case of Company; or
4.5.4 the sale or enforcement of, or realization upon (through
judicial foreclosure, power of sale or any other means)
any security for any of the Promissory Note, even though
recourse may not thereafter be had against Company for any
deficiency, or OSP fails to pursue any such recourse which
might otherwise be available, whether by way of deficiency
judgment following judicial foreclosure, or otherwise.
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4.6 PAYMENT OF PROMISSORY NOTE. Until the Promissory Note has been
performed in full, the Guarantor shall not have any right to
subrogation against Company or OSP, and the Guarantor waives:
4.6.1 any right to enforce any remedy which OSP now has or may
hereafter have against Company, and
4.6.2 any benefit of, and any right to participate in, any
security now or hereafter held by OSP.
4.7 STATUTE OF LIMITATIONS. The Guarantor waives any right to plead or
assert any election of remedies and the defense of the statute of
limitations in any action to enforce this Guaranty.
4.8 INDEPENDENT LIABILITY. The Guarantor shall not be discharged,
released or exonerated, in any way, from its absolute,
unconditional, and independent liabilities hereunder, by the
voluntary or involuntary participation by Company in any settlement
or composition for the benefit of Company's creditors either in
liquidation, readjustment, receivership, bankruptcy or otherwise.
4.9 WAIVER. The Guarantor hereby expressly waives any and all benefits
under California Civil Code Section 2809, 2810, 2819, 2845, 2847,
2848, 2849, 2850, 2899 and 3433.
5. NO NOTICE REQUIRED. Guarantor fully waives all requirements, if any, of
demand, presentment, diligence, protest and notice or dishonor and all other
notices of every kind or nature in respect of the Promissory Note. Guarantor
will not be released or exonerated from Guarantor's obligations under this
Guaranty if Guarantor is not notified by OSP of Company's failure to pay timely
any amount owed under the Promissory Note.
6. GUARANTOR'S ADDITIONAL WAIVERS. Guarantor waives any right Guarantor may
have to require any of the following acts: demand; presentment; diligence;
protest; notice of dishonor; and any other notice to which Guarantor may be
entitled.
7. NO RELEASE OF GUARANTOR. OSP may do or suffer any of the following, by
action or inaction, without releasing or exonerating Guarantor from any of
Guarantor's obligations under this Guaranty and without notifying Guarantor of
any of the following: (i) renew, extend, rearrange, alter, impair, suspend or
otherwise modify the Promissory Note; (ii) sell, release, subordinate, impair,
suspend, waive or otherwise fail to obtain, perfect or realize upon (or continue
the perfection of) a security interest in any collateral for this Guaranty; or
(iii) exercise OSP's rights in any collateral.
8. WAIVER OF SUBROGATION, REIMBURSEMENT, PERFORMANCE AND INDEMNIFICATION.
Guarantor permanently waives and shall not seek to exercise any of the following
rights that Guarantor may have against OSP for any for any amounts paid by
Guarantor, or acts performed by Guarantor under this Guaranty: (i) all rights
that Guarantor may have, upon satisfying the Promissory Note or any portion
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thereof, to enforce any remedies which OSP then has against Company in
connection with this Guaranty (including, without limitation, any right of
subrogation (whether contractual, under Section 509 of the Bankruptcy Code,
other similar insolvency laws or arrangements, or otherwise); (ii) all rights
that Guarantor may have to the benefit of any security for the performance under
the Promissory Note; (iii) all rights of reimbursement from Company for the
amounts paid by Guarantor in connection with the Promissory Note (including
costs and expenses); or (iv) all rights of indemnification from Company or any
other third party. Guarantor irrevocably waives and releases OSP from all
"claims" (as defined in Section 101(4) of the Bankruptcy Code) to which
Guarantor is or would be entitled by virtue of this Guaranty.
9. [Intentionally omitted]
10. MISCELLANEOUS.
10.1 REVIVAL OF DEBT. Notwithstanding any revocation of this Guaranty,
Guarantor's obligations under this Guaranty shall include and shall
be increased by the amount returned by OSP which was previously
paid by Company prior to the effectiveness of such revocation
because of the application of the Bankruptcy Code, any fraudulent
transfer law, or any law respecting preferences.
10.2 EFFECT OF COMPLIANCE. Guarantor's compliance with any of the
provisions of this Guaranty will not reduce or affect in any manner
the liability of Guarantor under any of the other provisions of
this Guaranty.
10.3 NO MARSHALING. OSP has no obligation to marshal any assets in
favor of Guarantor.
10.4 FEES AND COSTS. Guarantor will pay all of OSP's fees and costs
incurred in enforcing this Guaranty, including OSP's reasonable
attorneys' fees (including without limitation any attorneys
fees' incurred by OSP in connection with any probate claim,
bankruptcy claim, third-party claim, secured creditor claim,
reclamation complaint, and complaint for relief from any stay
under the U.S. Bankruptcy Code or otherwise).
10.5 ASSIGNMENT. Guarantor may not assign Guarantor's obligations or
liabilities under this Guaranty. This Guaranty may be assigned or
transferred in whole or in part by OSP, and the benefit of this
Guaranty shall automatically pass with a transfer or assignment
of the Promissory Note (or any portion thereof) to any subsequent
owner or holder. All references to OSP herein shall be deemed to
include any successors or assignees or any subsequent owners or
holders of the Promissory Note (or any portion thereof) or any of
them. This Guaranty is also made for the benefit of any person
claiming by, through or under OSP and any purchaser of any
security or any portion thereof at foreclosure or otherwise as a
result of the exercise of any right or remedy. Subject to
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the preceding sentence, this Guaranty shall be binding upon the
parties hereto and their respective heirs, executors, successors,
representatives and assigns and shall inure to the benefit of the
parties hereto and their respective successors and assigns.
10.6 APPLICABLE LAW. The laws of the State of California will apply to
the interpretation and enforcement of this Guaranty, without regard
to California's internal laws regarding conflicts of law.
10.7 INTEGRATION. This Guaranty is the entire agreement of Guarantor
with respect to the subject matter of this Guaranty.
10.8 RIGHTS CUMULATIVE. All of OSP's rights under this Guaranty are
cumulative. The exercise of any one right does not exclude the
exercise of any other right given in this Guaranty or any other
right of OSP not set forth in this Guaranty.
10.9 RULES OF CONSTRUCTION. The following rules shall apply in
interpreting the meaning of this Guaranty: (i) "Includes" and
"including" are not limiting; (ii) "Or" is not exclusive; and
(iii) "All" includes "any" and "any" includes "all."
10.10 SEVERABILITY. If any provision of this Guaranty is unenforceable,
or otherwise invalid, the remaining provisions of this Guaranty
shall be enforced to the fullest possible extent.
10.11 NOTICES. Any notice given in connection with this Guaranty shall
be in writing addressed to the respective party at its address set
forth below its signature on the last page of this Guaranty and may
be personally served, telecopied or sent by overnight courier
service or United States certified mail, postage prepaid; provided,
however, that any notice of revocation of this Guaranty may only be
sent by United States certified mail, postage prepaid. Notices
shall be deemed to have been given: (a) if delivered in person,
when delivered; (b) if delivered by telecopy, on the date of
transmission if confirmed and if transmitted on a business day
before 4:00 p.m. or, if not, on the next succeeding business day;
(c) if delivered by overnight courier, two days after delivery to
such courier properly addressed; or (d) if by United States
certified mail, five business days after depositing in the United
States mail, with postage prepaid and properly addressed. The
address for notices may be changes by delivering written notice of
such change in accordance with this Section.
10.12 HEADINGS; NUMBER; GENDER. Section headings used in this Guaranty
are for convenience only. They are not a part of this Guaranty and
shall not be used in construing this Guaranty. Wherever
appropriate in this Guaranty, the singular shall be deemed to also
refer to the plural, and the plural to the singular.
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10.13 COUNTERPARTS. This Guaranty may be executed in counterparts, or by
facsimile, each of which shall be deemed an original, but all of
which, when taken together, shall be deemed one and the same
agreement. A facsimile signature may be used to enforce the terms
of this Guaranty.
10.14 SUBORDINATION OF THE GUARANTOR'S CLAIMS. Any indebtedness of
company now or hereafter held by the Guarantor is hereby
subordinated to the Promissory Note; and such indebtedness of
Company to the Guarantor, if OSP so requests, shall be collected,
enforced and received by the Guarantor as trustee for OSP and be
paid over to OSP on account of the Promissory Note but without
reducing or affecting in any manner the absolute, unconditional
and independent liability of the Guarantor under this Guaranty.
10.15 ORDER OF REFERENCE. The parties waive the right to a jury trial
and agree to submit all actions, claims or controversies to a
trial on Order of Reference conducted by a retired judge or
justice from the panel of Judicial Arbitration & Mediation
Services, Inc. ("JAMS") appointed pursuant to Cal. Code Civ.
Proc. Section 638(1). The parties intend this general reference
to be specifically enforceable. If the parties are unable to
agree upon a member of the JAMS panel to act as referee, one
shall be appointed by the Presiding Judge of the Los Angeles
County Superior Court.
11. ACKNOWLEDGMENT OF WAIVERS AND LOSS OF DEFENSES.
11.1 Guarantor acknowledges that certain provisions of this Guaranty
operate as waivers of rights that Guarantor would otherwise have
under applicable law. Other provisions permit OSP to take actions
that OSP would otherwise not have a right to take, to fail to take
actions that OSP would otherwise have an obligation to take, or to
take actions that may prejudice Guarantor's rights and obligations
under this Guaranty and against Company. In the absence of these
provisions Guarantor might have defenses against Guarantor's
obligations under this Guaranty. These defenses might permit
Guarantor to avoid some or all of Guarantor's obligations under
this Guaranty.
11.2 Guarantor intends by the waivers and other provisions of this
Guaranty, including the acknowledgement set forth in this section,
to be liable to the greatest extent permitted by law for all of
Company's obligations to OSP under the Promissory Note.
11.3 Guarantor acknowledges that (i) Guarantor understands the
seriousness of the provisions of this Guaranty; (ii) Guarantor
has had a full opportunity to consult with counsel of Guarantor's
choice; and (iii) Guarantor has consulted with counsel of
Guarantor's choice or has decided not to consult with counsel.
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IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the
date first above written.
XXXXXXX XXXXXXXX, an individual
By: /s/ XXXXXXX XxXXXXXX
__________________________
Xxxxxxx XxXxxxxx
Address: 00000 Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax: (000) 000-0000
OSP PUBLISHING, INC., hereby accepts this Guaranty and agrees to the
provisions contained herein.
OSP PUBLISHING, INC.
By: /s/ XXXXXXX X. XXXX
______________________________
Xxxxxxx X. Xxxx, President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx, XX 00000
Fax: (000) 000-0000
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