EXHIBIT 10.18
LOAN GUARANTY AND SURETYSHIP AGREEMENT
THIS LOAN GUARANTY AND SURETYSHIP AGREEMENT given by the undersigned
(hereinafter called the "Guarantors") to PUBLIC SCHOOL EMPLOYES' RETIREMENT
BOARD an independent Administrative Board of the Commonwealth of Pennsylvania
transacting business in the name of the PUBLIC SCHOOL EMPLOYES' RETIREMENT
SYSTEM (PSERS hereinafter called the "Lender") to induce Lender to extend credit
to or otherwise become the creditor of POLYCHEM CORPORATION, A PENNSYLVANIA
CORPORATION (hereinafter called the "Borrower").
W I T N E S S E T H
WHEREAS, Borrower, has requested Lender to make a loan (the "loan") to
Borrower in the amount of ONE MILLION EIGHT HUNDRED EIGHTY THOUSAND DOLLARS
($1,880,000), under the terms and conditions set forth in that certain Permanent
Loan Commitment Letter (hereinafter "Commitment Letter") dated May 30, 1999, by
and between Xxxx Xxxxx Real Estate Services, Inc. As agent for Lender; and
WHEREAS, the loan is being evidenced by a certain Balloon Mortgage Note
(the "Note") in the amount of $1,880,000; and
WHEREAS, the loan is to be secured by, among other security, the Open End
Mortgage and Security Agreement (the "Mortgage") executed by Borrower in favor
of Lender for the premises located at FRANKLIN AVENUE AND GRANT STREET, BOROUGH
OF PHOENIXVILLE, XXXXXXX COUNTY, PENNSYLVANIA; and
WHEREAS, Lender is willing to make the loan to Borrower only if Guarantors
guarantee (i) the full and prompt payment (and not merely the collectibility) of
the Note and all amounts to come due under the Balloon Mortgage Note; and (ii)
the full and prompt performance of the terms of the Balloon Mortgage Note and
the Open End Mortgage and Security Agreement, both being executed simultaneously
herewith.
NOW THEREFORE, In consideration of the foregoing, Guarantors jointly and
severally agree as follows:
1. Recitals Incorporated. Guarantors acknowledge and agree that the
foregoing recitals constitute a material part of the Guaranty, and the same are
expressly incorporated herein by this reference.
2. Obligation of Guarantors. The Guarantors hereby agree (a) to
absolutely and unconditionally guarantee to the Lender, its successors and
assigns, and become surety to the Lender, its successors and assigns, for the
prompt payment to the Lender when due of any and every obligation, in connection
with which either as makers, drawers, guarantors or endorsers, or otherwise,
whether directly or contingently, the Borrower is now or shall become liable to
the Lender, with interest thereon at the rate or rates provided in the
obligations guaranteed hereby, until payment in full has been received by
Lender, together with costs including but not limited to all attorney's fees,
costs and expenses of collection or for the protection, preservation or repair
of any real or personal property held as security therefore, and interest
thereon, including costs, expenses and attorneys' fees on appeal, incurred by
the Lender, in connection with any indebtedness of Borrower guaranteed herein
and with any matter covered by this Guaranty; and (b) to become guarantors and
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sureties for the full, prompt and punctual performance and satisfaction of
Borrower's obligations under the Balloon Mortgage Note, Open-End Mortgage and
Security Agreement and any other related loan documents; and (c) that this
Guaranty and Suretyship shall survive and Guarantor's obligations and
liabilities hereunder shall remain unaffected by the dissolution of Borrower
whether voluntary or involuntary and/or any transfer or other disposition of
Guarantor's interest in Borrower; and (d) this guaranty shall be binding upon
the undersigned, their heirs, personal representatives, successors and assigns.
The specific loan obligation guaranteed hereunder is a Balloon Mortgage Note in
the amount of ONE MILLION EIGHT HUNDRED EIGHTY THOUSAND DOLLARS ($1,880,000)
together with a Mortgage and Security Agreement and any other related loan
documents.
3. Direct Guaranty. The liability of Guarantors under this Guaranty,
shall be primary, direct and immediate and not conditional or contingent on
pursuit by Lender of any remedies it may have against Borrower or Borrower's
heirs, personal representatives, successors and assigns, with respect to the
Note or the other Loan Documents, whether pursuant to the terms thereof or by
law. Without limiting the generality of the foregoing, Lender shall not be
required to make any demand on Borrower or otherwise pursue or exhaust its
remedies against Borrower, before, simultaneously with, or after enforcing its
rights and remedies hereunder against Guarantors. Any one or more successive
and/or concurrent actions may be brought hereon against Guarantors either in the
same action, if any, brought against Borrower, or in a separate action, as often
as Lender may deem advisable.
4. Additional Obligations of Guarantors. So long as this Guaranty
remains in effect, Guarantors have not, and will not, without Lender's prior
written consent, sell, lease, assign, pledge, hypothecate, encumber, transfer or
otherwise dispose of all or substantially all of Guarantors' assets. Guarantors
agree to remain adequately informed of any facts, events or circumstances which
might in any way affect Guarantors' risks under this Guaranty. Guarantors
further agree that Lender shall have no obligation to disclose to Guarantors any
information or material information relating to Borrower or to Borrower's
indebtedness
5. Term of Guaranty. The liability of the Guarantors are continuing,
absolute and unconditional, and shall remain in full force and effect until
payment is made of every obligation of the Borrowers now due or hereafter to
become due, and until payment is made of any loss or damage incurred by the
Lender with respect to any matter covered by this Guaranty and until all other
covenants and conditions of the Borrower under the Balloon Mortgage Note and the
Mortgage and Security Agreement and any other related loan documents are
fulfilled.
6. Consent to Lender's Acts. The Guarantors consent, without affecting
the Guarantors' liability to the Lender hereunder, that the Lender may, without
notice to or consent of the Guarantors, with or without consideration and upon
such terms as it may deem advisable in its sole discretion: (a) make future
advances or additional extensions of credit to the Borrower; (b) extend, in
whole or in part, by renewal or otherwise, and for any period or periods, the
time of payment of any indebtedness owing by the Borrower to the Lender, or held
by the Lender as security for any such obligation; (c) release, surrender,
exchange, modify, impair, or extend the period of duration, or the time for
performance or payment of any collateral securing any obligation of the Borrower
to the Lender; (d) settle or compromise any claim of the Lender against the
Borrower, or against any other person, firm or corporation, whose obligation is
held by the Lender as collateral security for any obligation of the Borrower to
the Lender; and (e) release, in whole or in part, any person primarily or
secondarily liable for any indebtedness of Borrower to Lender. The Guarantors,
hereby ratify and confirm any such future advance, extension, renewal, release,
surrender, exchange, modification, impairment, settlement, or compromise; and
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all such actions shall be binding upon the Guarantors who hereby waive all
defenses, counterclaims, or offsets which the Guarantors might have by reason
thereof.
7. Waivers by Guarantors. The Guarantors waive: (a) notice of acceptance
of this Guaranty by the Lender; and (b) notice of nonpayment or partial payment
under the Note or other loan documents or the occurrence of any other Event of
Default; and (c) notice of presentment, notice of dishonor, demand for payment,
or protest of any of the Borrower's obligations, or the obligation of any
person, firm, or corporation, held by the Lender as collateral security for the
Borrower's obligation; (d) notice of the failure of any person, firm, or
corporation to pay to the Lender any indebtedness held by the Lender as
collateral security for any obligation of the Borrower; and (e) all defenses,
offsets and counterclaims which the Guarantors may at any time have to any claim
of the Lender against the Borrower. If for any reason the indebtedness or
obligations of the Borrower cannot be enforced against Borrower, such fact shall
not affect the liability of Guarantors hereunder, but Guarantors shall be liable
hereunder as if the indebtedness or obligations had been enforceable against
Borrower.
Guarantors warrant and agree that each of the waivers set forth above is
made with Guarantors' full knowledge of its significance and consequences and
that, under the circumstances, such waivers are reasonable and not contrary to
public policy or law. If any such waiver is determined to be contrary to any
applicable law or public policy, such waiver shall be effective only to the
extent permitted by law.
8. Representations by Guarantors. The Guarantors represent that, (a) at
the time of the execution and delivery of this Guaranty, nothing exists to
impair the effectiveness of the liability of the Guarantors to the Lender
hereunder, or the immediate taking effect of this Guaranty as the sole agreement
between the Guarantors and the Lender with respect to guaranteeing the
Borrower's obligation to the Lender; and (b) Guarantors have examined the
Balloon Mortgage Note and the Open End Mortgage and Security Agreement and
related loan documents and understand the promises, covenants and conditions
thereunder; and (c) Guarantors have the full power, authority and legal right to
execute and deliver this Guaranty; and (d) this Guaranty and the Guarantors
execution, delivery and performance hereunder are not in violation of any laws
and will not result in a default under any contract, agreement, or instrument to
which Guarantors are a party, or by which Guarantors or Guarantors' property may
be bound; and (e) Lender has made no representations to Guarantors as to the
creditworthiness of Borrower.
9. Additional Guaranty or Guaranties. In the event Guarantors may, in
the future, grant one or more additional guaranties of the Note or an additional
Note or with respect to the Loan or any amounts due under any other Loan
Documents in favor of Lender, the execution of any additional guaranties on the
part of Guarantors will not be construed as a cancellation of this Guaranty; it
being Guarantors' full intent and agreement that this Guaranty shall remain in
full force and effect and shall be cumulative in nature and effect.
10. Remedy of Lender. The Lender may at its option proceed in the first
instance against the Guarantors to collect any obligation covered by this
Guaranty, without first proceeding against the Borrower, endorsers, or any other
persons, firm or corporation, and without first resorting to any property at any
time held by the Lender, Borrower or others as collateral or other security. In
the event Lender does not proceed first against Guarantors, Guarantors shall be
liable for any deficiency in the amount recovered from the Borrower, endorsers,
or any other persons, firm or corporation, or from the sale of the property held
by the Lender, Borrower or others as collateral or other security. The exercise
by Lender of any right conferred upon it in any collateral agreement shall be
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discretionary with Lender, and the exercise of, or failure to exercise, any such
right shall not diminish the obligations of Guarantors hereunder.
IN THE EVENT THAT THE NOTE WHICH THE UNDERSIGNED GUARANTEES SHALL FALL
INTO DEFAULT, GUARANTORS HEREBY IRREVOCABLY AUTHORIZE AND EMPOWER ANY ATTORNEY
OR ATTORNEYS OR THE PROTHONOTARY OR CLERK OF ANY COURT OF RECORD IN THE
COMMONWEALTH OF PENNSYLVANIA, OR IN ANY OTHER JURISDICTION WHICH PERMITS THE
ENTRY OF JUDGMENT BY CONFESSION, TO APPEAR FOR GUARANTORS IN SUCH COURT IN AN
APPROPRIATE ACTION THERE BROUGHT TO OR TO BE BROUGHT AGAINST GUARANTORS AT THE
SUIT OF LENDER THIS AGREEMENT, WITH OR WITHOUT COMPLAINT OR DECLARATION FILED AS
OF ANY TERM OR TIME, AND THEREIN TO CONFESS OR ENTER JUDGMENT AGAINST GUARANTORS
(WITH OR WITHOUT ACCELERATION OF MATURITY), INCLUDING ALL COSTS, ATTORNEY'S FEES
AND THE ATTORNEY'S COMMISSION PROVIDED FOR IN THE NOTE WHICH THIS DOCUMENT
SECURES. FOR SO DOING, THIS AGREEMENT OR A COPY HEREOF VERIFIED BY AFFIDAVIT
SHALL BE SUFFICIENT WARRANT. THE AUTHORITY TO CONFESS JUDGMENT GRANTED HEREIN
SHALL NOT BE EXHAUSTED BY ANY EXERCISE THEREOF BUT MAY BE EXERCISED FROM TIME TO
TIME AND AT ANY TIME AS OF ANY TERM AND FOR ANY AMOUNT AUTHORIZED HEREIN.
GUARANTORS EXPRESSLY AUTHORIZE THE ENTRY OF REPEATED JUDGMENTS UNDER THIS
PARAGRAPH NOTWITHSTANDING ANY PRIOR ENTRY OF JUDGMENT IN THE SAME OR ANY COURT
FOR THE SAME OBLIGATION OR ANY PART THEREOF.
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GUARANTORS ACKNOWLEDGES THAT THEY HAVE BEEN REPRESENTED BY COUNSEL IN
CONNECTION WITH THE EXECUTION AND DELIVERY OF THE NOTE IN WHICH THIS AGREEMENT
SECURES AND HAVE BEEN REPRESENTED BY COUNSEL IN CONNECTION WITH THE EXECUTION OF
THIS GUARANTY AND SURETYSHIP AGREEMENT AND THAT THEY UNDERSTAND THIS PROVISION
FOR CONFESSION OF JUDGMENT, AND GUARANTORS HEREBY WAIVE ANY RIGHT TO NOTICE OR
HEARING WHICH THEY MIGHT OTHERWISE HAVE BEFORE ENTRY OF JUDGMENT.
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OUR LEGAL COUNSEL HAS EXPLAINED TO US THAT THE NOTE WHICH THIS AGREEMENT
SECURES CONTAINS WORDING THAT WOULD PERMIT THE LENDER TO ENTER JUDGMENT AGAINST
US AT THE COURTHOUSE IF SAID NOTE IS IN DEFAULT, WITHOUT NOTICE TO US AND
WITHOUT OFFERING US AN OPPORTUNITY TO DEFEND AGAINST THE ENTRY OF JUDGMENT, AND
THAT THE JUDGMENT MAY BE COLLECTED BY ANY LEGAL MEANS. IN EXECUTING SAID NOTE,
WE ARE KNOWINGLY, UNDERSTANDINGLY, AND VOLUNTARILY WAIVING OUR RIGHTS TO RESIST
THE ENTRY OF JUDGMENT AGAINST US AT THE COURTHOUSE, AND ARE CONSENTING TO THE
CONFESSION OF JUDGMENT.
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11. WAIVER OF JURY TRIAL. GUARANTORS HEREBY WAIVE TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE THIS GUARANTY. IT IS AGREED AND UNDERSTOOD THAT
THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL
PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE
NOT PARTIES TO THIS GUARANTY. THIS WAIVER IS KNOWINGLY, WILLINGLY AND
VOLUNTARILY MADE BY GUARANTORS, AND GUARANTORS
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HEREBY ACKNOWLEDGE THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY
AN INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR
NULLIFY ITS EFFECT.
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12. Guarantors' Waiver of Certain Rights. Guarantors hereby waives any
claim, remedy or other right Guarantors may now possess or hereafter acquire
against Borrower or any other person arising from, or in any way related to, the
existence or performance under this Guaranty, including, without limitation, any
right of subrogation, reimbursement, exoneration, contribution, or
indemnification against Borrower or any other person(s) or any right to
participate in any collateral securing Borrower's indebtedness or other
obligations to Lender, regardless of whether such claim, remedy, or right arises
in equity, under contract, statute, common law or otherwise.
13. Guarantors' Receipt of Payments. If Guarantors should for any reason
whatsoever receive any payment(s) from Borrower (or any other guarantors,
sureties or endorsers or the Note of the other Loan Documents) that Borrower (or
such a third party) may owe to Guarantors, Guarantors agree to accept such
payment(s) in trust for and on behalf of Lender, advising Borrower (or the third
party payee) of such fact. Guarantors further unconditionally agree to
immediately deliver any such funds received to Lender, with such funds being
held by Guarantors, over any interim period, in trust for Lender. In the event
that Guarantors should, for any reason whatsoever, receive any such funds from
Borrower (or any third party), Guarantors should deposit such funds in one or
more of Guarantors' deposit accounts, no matter where located, Lender shall have
the right to attach the amount of funds received from Borrower in Guarantors'
deposit accounts in which such funds were deposited, whether or not such funds
were commingled with other monies of Guarantors, and whether or not such funds
then remain on deposit in such an account or accounts.
14. Modification of Agreement. The whole of this Guaranty is herein set
forth and there is no verbal or other written agreement, and no understanding or
custom affecting the terms hereof. This Guaranty can be modified only by a
written instrument signed by the party to be charged therewith.
15. Construction and Benefit. The Guaranty is delivered and made in, and
shall be construed pursuant to the laws of the Commonwealth of Pennsylvania, and
is binding jointly and severally upon the Guarantors and their legal
representatives, and shall inure to the benefit of the Lender, its successors
and assigns.
16. Severability. If any one or more of the provisions contained in this
Guaranty for any reason shall be held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability shall not affect
any other provisions of this Guaranty, but this Guaranty shall be construed as
if such invalid, illegal or unenforceable provision had never been continued
herein or therein.
17. Headings. The captions, headings and titles to sections of this
Guaranty are for convenience of reference only, and shall in no way restrict or
affect, or be in any way an interpretation of the provisions of any such section
of this Guaranty.
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18. Expenses of Lender. Guarantors agree to pay reasonable attorney's
fees and all other reasonable costs and expenses which may be incurred by Lender
in connection with the enforcement of this Guaranty.
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IN WITNESS WHEREOF, the Guarantors intending to be legally bound has
signed this Agreement on the 24th day of August , 1999.
WITNESS: GUARANTORS
POLYCHEM CORPORATION, A
PENNSYLVANIA CORPORATION
BY: /s/ Xxxx X. XxXxxxxx (SEAL)
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XXXX X. XXXXXXXX, CHAIRMAN AND CEO
CONMAT TECHNOLOGIES, INC., A
FLORIDA CORPORATION
BY: /s/ Xxxx X. XxXxxxxx (SEAL)
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XXXX X. DEJULLIS, CHAIRMAN AND CEO
BY: /s/ Xxxx X. XxXxxxxx (SEAL)
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XXXX X. DEJULLIS, Individually
COMMONWEALTH OF PENNSYLVANIA :
: SS.
COUNTY OF :
On this, the 24th day of August , 1999 before me, a Notary Public, the
undersigned officer, personally appeared Xxxx X. XxXxxxxx, who acknowledged
himself to be the Chairman and CEO of Polychem Corporation, a Pennsylvania
Corporation and ConMat Technologies, Inc., A Florida Corporation and that he as
such Chairman and CEO being authorized to do so executed the foregoing document
for the purposes therein contained by signing his name as such Chairman and CEO.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
Xxxxxxxxx Xxxxxxx
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Notary Public
My Commission Expires:
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