Exhibit 10.8
IBM CREDIT CORPORATION
COLLATERALIZED GUARANTY
OF PAYMENT
TO: IBM CREDIT CORPORATION ("IBM Credit") DATE September 30, 1997
0000 Xxxxxxxxx Xxxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Gentlemen:
In consideration of credit and financing accommodations granted or to be
granted by IBM Credit to Western Micro Technology, Inc. ("Dealer"), which is in
the best interest of INET Systems, Inc. ("Guarantor") and from which Guarantor
will derive direct or indirect economic benefit, and for other good and valuable
consideration received, Guarantor hereby jointly and severally guaranties to IBM
Credit, from property held separately, jointly or in community, the prompt and
unconditional performance and payment by Dealer of any and all obligations,
liabilities, contracts, mortgages, notes, trust receipts, secured transactions,
inventory financing and security agreements, and commercial paper on which
Dealer is in any manner obligated, heretofore, now, or hereafter owned,
contracted or acquired by IBM Credit ("Liabilities"), whether the Liabilities
are individual, joint, several, primary, secondary, direct, contingent or
otherwise. Guarantor acknowledges that IBM Credit is providing financing to
Dealer based in part upon this Guaranty. Guarantor also acknowledges that IBM
Credit has required this Guaranty as a condition, among others, to provide
financing to Dealer.
If Dealer fails to pay or perform any Liabilities to IBM Credit when due,
all Liabilities to IBM Credit shall then be deemed to have become immediately
due and payable, and the Guarantor shall then pay upon demand the full amount of
all sums owed to IBM Credit by Dealer, together with all reasonable expenses,
including reasonable attorney's fees.
The liability of each Guarantor is direct and unconditional and shall not
be affected by any extension, renewal or other change in the terms of payment of
any security agreement, promissory note, or any other agreement between IBM
Credit and Dealer, or any change in the manner, place or terms of payment or
performance thereof, or the release, settlement or compromise of or with any
party liable for the payment or performance thereof, the release or non-
perfection of any security thereunder, any change in Dealer's financial
condition, or the interruption of business relations between IBM Credit and
Dealer. This Guaranty shall continue for so long as any sums owing to IBM
Credit by Dealer remain outstanding and unpaid, unless terminated in the manner
provided below. Each Guarantor acknowledges that its obligations hereunder are
in addition to and independent of any agreement or transaction between IBM
Credit and Dealer or any other person creating or reserving any lien,
encumbrance or security interest in any property of Dealer or any other person
as security for any obligation of Dealer. IBM Credit need not exhaust its
rights or recourse against Dealer or any other person or any security it may
have at any time before being entitled to payment from the Guarantor. This is a
Guaranty of Payment and not a Guaranty of Collection.
To secure payment of all of the Guarantor's current and future debts and
obligations to IBM Credit, whether under this Guaranty or any other agreement,
whether direct or contingent, the Guarantor does assign, pledge and give to IBM
Credit a security interest in all of the Guarantor's inventory, raw materials,
goods in process, finished goods, machines, machinery, furniture, furnishings,
fixtures, vehicles, equipment, accounts receivable, book debts, notes, chattel
paper, acceptances, rebates, incentive payments, drafts, contracts, contract
rights, choses in action, and any and all general intangibles, whether now owned
or hereafter acquired, and all attachments, accessions and additions thereto,
substitutions, replacements, accessories, and equipment therefor, and all
proceeds therefrom (all of the above property is referred to as "the
Collateral"). This security interest is also granted to secure the Guarantor's
debts to all affiliates of IBM Credit.
IBM Credit shall have the right, but not the obligation, from time to time,
as it in its sole discretion may determine, and all without any advance notice
to the Guarantor, to: (a) examine the Collateral; (b) appraise it as security;
(c) verify its condition and non-use; (d) verify that all Collateral has been
properly accounted for and this Agreement complied with, and (e) assess,
examine, check and make copies of any and all of the non-confidential books,
records and files of Guarantor.
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If the Guarantor does not comply with any of the terms of this Agreement,
or fails to fulfill any obligation to IBM Credit or any of its affiliates under
any other agreement, or the Guarantor becomes insolvent or ceases to do business
as a going concern, or a bankruptcy, insolvency proceeding, arrangement or
reorganization is filed by or against the Guarantor, or any of the Guarantor's
property is attached or seized, or a receiver is appointed for the Guarantor, or
the Guarantor shall lose any franchise, permission, license or right to conduct
its business, or the Guarantor misrepresents in a material way its financial
condition or organizational structure, or whenever IBM Credit reasonably and in
good xxxxx xxxxx the debt or Collateral to be insecure:
a) IBM Credit may call all or any part of the amount the Guarantor or
Dealer owes IBM Credit or its affiliates due and payable immediately, if
permitted by applicable law, together with court costs and all costs and
expenses of IBM Credit's repossession and collection activity, including,
but not limited to reasonable attorney's fees.
b) The Guarantor will hold and keep the Collateral in trust, in good order
and repair, for IBM Credit's benefit and shall not exhibit or sell them.
c) Upon IBM Credit's demand, the Guarantor will immediately deliver the
Collateral to IBM Credit, in good order and repair, at a place reasonably
convenient to IBM Credit, together with all related documents; or IBM
Credit may, in its sole discretion and without demand, take immediate
possession of the Collateral, together with all related documents.
d) The Guarantor waives and releases: (i) any and all claims and causes of
action which the Guarantor may now or ever have against IBM Credit as a
result of any possession, repossession, collection or sale by IBM Credit of
any of the Collateral, notwithstanding the effect of such possession,
repossession, collection or sale upon the undersigned's business; (ii) all
rights of redemption from any such sale; and (iii) the benefit of all
valuation, appraisal and exemption laws. If IBM Credit seeks to take
possession of any of the Collateral by replevin or other court process, the
Guarantor irrevocably waives any notice, bonds, surety and security
relating thereto required by any statute, court rule or otherwise as an
incident to such possession.
e) The Guarantor appoints IBM Credit or any person it may delegate as its
duly authorized Attorney-in-Fact to do, in IBM Credit's sole discretion,
any of the following: (i) sell, assign, transfer, negotiate or pledge any
and all accounts, chattel paper, or contract rights; (ii) endorse the
Guarantor's name on any and all notes, checks, drafts, or other forms of
exchange received as payment on any accounts, chattel paper and contract
rights, for deposit in IBM Credit's account; (iii) grant any extension,
rebate or renewal on any and all accounts, chattel paper or contract
rights, or enter into any settlement thereof; (iv) demand, collect and
receive any and all amounts due on accounts, chattel paper and contract
rights; and (v) exercise any and all rights Guarantor has in the
Collateral.
f) In the event the Guarantor brings any action or asserts any claim
against IBM Credit which arises out of this Agreement, any other agreement
or any of our business dealings, in which the Guarantor does not prevail,
the Guarantor agrees to pay to IBM Credit all court costs and all
reasonable costs and expenses of IBM Credit's defense of such action of
claim including, but not limited to, reasonable attorney's fees.
IBM Credit may also declare a default under this Agreement and exercise any
and all rights and remedies available herein, if, in IBM Credit's sole
discretion, IBM Credit determines that the Collateral has substantially
decreased in value, and Guarantor has been unable to either: (a) provide IBM
Credit with additional collateral in a form and substance satisfactory to IBM
Credit; or (b) reduce the total indebtedness of Dealer by an amount sufficient
to IBM Credit.
IBM Credit has and will always possess all the rights and remedies of a
secured party under law, and its rights and remedies are and will always be
cumulative. The Guarantor acknowledges and agrees that the Collateral is the
subject of widely distributed standard price quotations and is customarily sold
in a recognized market. Guarantor agrees that a private sale by IBM Credit of
any of the Collateral to a dealer in those types of Collateral is a commercially
reasonable sale. Further, Guarantor agrees that delivery by IBM Credit of any
of the Collateral to a distributor or manufacturer, with a request that it
repurchase Collateral, as provided in any repurchase agreement with IBM Credit,
is a commercially reasonable disposition or sale.
The Guarantor promises that except for liens and claims previously
disclosed to IBM Credit and purchase money liens (a) the Collateral is and shall
remain free from all claims and liens superior to yours; (b) the Guarantor shall
defend the Collateral against all other claims and demands; and (c) the
Guarantor will notify IBM Credit before it signs, or authorizes the signing of
any financing statement regardless of its coverage. Where permitted by law, IBM
Credit may perfect its security interest in the Collateral by filing a financing
statement signed only by IBM Credit. The undersigned will execute any and all
documents IBM Credit may request to confirm or perfect its title or security
interest in the Collateral.
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Guarantor's principal place of business is located at:
000 Xxxx Xxxx Xxx Xxxxxxx, XX 00000
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(Number and Street) (City, County, State, Zip Code)
and Guarantor represents that its business is conducted as a ___ SOLE
PROPRIETORSHIP, PARTNERSHIP, ___ JOINT VENTURE, X CORPORATION, ___ COOPERATIVE
---
(check applicable term). The Guarantor agrees to notify IBM Credit immediately
of any change in identity, name, form of ownership or management, and of any
change in its principal place of business, or any additions or discontinuances
of other business locations.
The Collateral shall be kept at the Guarantor's principal place of business
and at the following addresses:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
until all sums owed to IBM Credit are paid in full. The undersigned will
immediately notify you if the Collateral is kept at any other address. This
paragraph is for IBM Credit's informational purposes only, and is not in any way
or manner intended to limit the extent of IBM Credit's security interest in the
Collateral.
The Guarantor and its predecessors have done and do business only under the
following names:
________________________________________________________________________________
________________________________________________________________________________
The Guarantor will pay all taxes, license fees, assessments and charges on
the Collateral when due. The Guarantor will be responsible for any loss of
Collateral for any reason whatsoever. The Guarantor will keep the Collateral
insured for its full insurable value against loss or damage by fire, wind, theft
and for combined additional coverage, including vandalism and malicious
mischief, and for other risks as IBM Credit may require. The Guarantor will
obtain insurance under such terms and in amounts as IBM Credit may specify, from
time to time, in companies acceptable to IBM Credit, with a loss-payee or
mortgagee clause payable to IBM Credit to the extent of any loss to the
Collateral and containing a waiver of all defenses against the Guarantor that is
acceptable to you. The undersigned further agrees to provide IBM Credit with
written evidence of the required insurance coverage and loss-payee or mortgagee
clause. The Guarantor assigns to IBM Credit all sums not in excess of the
unpaid debt owed IBM Credit, and directs any insurance company to make payment
directly to IBM Credit to be applied to the unpaid debt owed IBM Credit. The
Guarantor further grants you an irrevocable power of attorney to endorse any
draft and sign and file all of the necessary papers, forms and documents to
initiate and settle any and all claims with respect to the Collateral. If the
Guarantor fails to pay any of the above-referenced costs, charges or any
insurance premiums, or if it fails to insure the Collateral, IBM Credit may pay
such costs, charges or any insurance premiums, and the amounts paid shall be
considered an additional debt owed by the Guarantor to IBM Credit. The
Guarantor will promptly notify IBM Credit of any loss, theft or destruction of
or damage to any of the Collateral.
Except for transactions in the ordinary course of business, the Guarantor
will not rent, lease, lend, demonstrate, pledge, create a security interest in,
transfer or secrete any of the Collateral, or use the Collateral for any purpose
other than exhibition, without IBM Credit's prior written consent, which will
not be unreasonably withheld.
This Guaranty is assignable, shall be construed liberally in favor of IBM
Credit, and shall inure to the benefit of and bind respective successors,
personal representatives and assigns of IBM Credit and Guarantor, and also
benefit any of existing or future affiliates of IBM Credit that may extend
credit to Dealer.
In accordance with Section 2856 of the California Civil Code (if the same
shall be found to be applicable): (i) Guarantor waives any and all rights of
defenses available to such Guarantor by reason of Sections 2787 to 2855,
inclusive, 2899 and 3433 of the California Civil Code, including without
limitation any or all rights and defenses such Guarantor may have by reason of
protection afforded to the principal with respect to any of the Liabilities, or
to any other guarantor (including any other Guarantor) of any of the Liabilities
with respect to any of such guarantor's obligations under its guaranty, in
either case pursuant to the antideficiency or other laws of the State of
California limiting or discharging the Dealer's indebtedness or such guarantor's
Liabilities, including without limitation Section 580a, 580b, 580d, or 726 of
the California Code of Civil Procedure; and (ii) Each Guarantor waives all
rights and defenses arising out of an election of remedies by the creditor, even
though that election of remedies, such as a nonjudicial foreclosure with respect
to security for any Liabilities, has destroyed such Guarantor's rights of
subrogation and reimbursement against the principal by the operation of Section
580d of the California Code of Civil Procedure or otherwise; and even though the
election of remedies by the creditor, such as nonjudicial foreclosure with
respect to security for an obligation of any other guarantor of any of the
Liabilities, has destroyed such Guarantor's rights of contribution against such
other guarantor. No other provision of this Guaranty shall be construed as
limiting the generality of any of the covenants and waivers set forth in this
paragraph. This paragraph
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is included solely out of an abundance of caution and shall not be construed to
mean any of the above-referenced provisions of California law are in any way
applicable to this Guaranty or to any of the Liabilities.
If Dealer hereafter is incorporated, acquired by a corporation, dissolved,
or otherwise undergoes any change in it's management, ownership, identity, or
organizational structure, this Guaranty shall continue to extend to any
Liabilities of the Dealer or such resulting corporation, dissolved corporation,
or new or changed legal entity, or identity to IBM Credit.
The Guarantor waives: notice of the acceptance of this Guaranty, and of
presentment, demand and protest; notices of nonpayment, nonperformance, any
right of contribution from other guarantors, and dishonor; notices of amount of
indebtedness of Dealer outstanding at any time; notices of the number and amount
of advances made by IBM Credit to Dealer in reliance on this Guaranty; notices
of any legal proceedings against Dealer; notice and hearing as to any
prejudgment remedies; and any other demands and notices required by law. The
Guarantor further waives all rights of set-off and all counterclaims against IBM
Credit or Dealer. The Guarantor also waives any and all rights in and notices
or demands relating to any collateral now or hereafter securing any of the
Liabilities, including, but not limited to, all rights, notices or demands
relating, whether directly or indirectly, to the sale or other disposition of
any or all of such collateral or the manner of such sale or other disposition.
All waivers by the Guarantor herein shall survive any termination or revocation
of this Guaranty.
The Guarantor authorizes IBM Credit to sell at public or private sale or
otherwise realize upon the collateral now or hereafter securing any of the
Liabilities, in such manner and upon such terms and conditions as IBM Credit
deems best. The Guarantor further authorizes IBM Credit to deal with the
proceeds of such collateral as provided in IBM Credit's agreement with Dealer,
without prejudice to IBM Credit's claim for any deficiency and free from any
right or redemption on the part of Dealer, the Guarantor or any third parties,
which right or redemption is hereby waived together with every formality
prescribed by custom or by law in relation to any such sale or other
realization.
The Guarantor further agrees that all of its right, title and interest in,
to and under any loans, notes, debts and all other liabilities and obligations
whatsoever owed by Dealer to the Guarantor, whether heretofore or hereafter
created or incurred and for whatever amount, and all security therefor, shall be
now and hereafter at all times fully subordinated to all Liabilities. Except
for intercompany transactions in the ordinary course of business, the Guarantor
will not ask, demand or xxx for, or take or receive payment of, all or any part
of such loans, notes, debts or any other liabilities or obligations whatsoever
or any security therefor, until and unless all of the Liabilities are paid,
performed and fully satisfied.
The Guarantor has made an independent investigation of the financial
condition of Dealer and gives this Guaranty based on that investigation and not
upon any representations made by IBM Credit. The Guarantor acknowledges that it
has access to current and future Dealer financial information which will enable
the Guarantor to continuously remain informed of Dealer's financial condition.
The Guarantor also consents to and agrees that the obligations under this
Guaranty shall not be affected by subsequent increases or decreases in the
credit line that IBM Credit may grant to Dealer; substitutions, exchanges or
releases of all or any part of the collateral now or hereafter securing any of
the Liabilities; sales or other dispositions of any or all of the collateral now
or hereafter securing any of the Liabilities without demands, advertisement or
notice of the time or place of the sales or other dispositions; realizing on the
collateral to the extent IBM Credit, in its sole discretion, deem proper; or
purchases of all or any part of the collateral for IBM Credit's own account.
This Guaranty and any and all obligations, liabilities, terms and
provisions herein shall survive any and all bankruptcy or insolvency
proceedings, actions and/or claims brought by or against Dealer, whether such
proceedings, actions and/or claims are federal and/or state.
This Guaranty is submitted by the Guarantor to IBM Credit (for its
acceptance or rejection thereof) at its above specified office; as an offer by
the Guarantor to guaranty the credit and financial accommodations provided by
IBM Credit to Dealer. If accepted, this Guaranty shall be deemed to have been
made at IBM Credit's above-specified office. This Guaranty and all obligations
pursuant thereto, shall be governed and controlled as to interpretation,
enforcement, validity, construction, effect and, in all other respects by the
laws of the state of New York. The Guarantor, to induce IBM Credit to accept
this Guaranty, agrees that all actions or proceedings arising directly or
indirectly in connection with, out of, related to or from this Guaranty may be
litigated in courts within the state of New York. The Guarantor consents and
submits to the jurisdiction of any local, state or federal court located within
that state. The Guarantor waives any right to transfer or change the venue of
any litigation brought against the Guarantor by IBM Credit in accordance with
this paragraph.
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Any delay by IBM Credit, or its successors, affiliates or assigns in
exercising any or all rights granted IBM Credit under this Guaranty shall not
operate as a waiver of those rights. Furthermore, any failure by IBM Credit,
its successors, affiliates or assigns, to exercise any or all rights granted IBM
Credit under this Guaranty shall not operate as a waiver of IBM Credit's right
to exercise any or all of them later.
This document contains the full agreement of the parties concerning the
guaranty of Dealer's Liabilities and can be varied only by a document signed by
all of the parties hereto. The Guarantor may terminate this Guaranty by notice
to IBM Credit in writing, the termination to be effective sixty (60) days after
receipt and acknowledgment thereof by IBM Credit, but the termination shall in
no manner terminate the Guarantor's guaranty of Liabilities arising prior to the
effective date of termination. If executed by more than one party "Guarantor"
shall be deemed to refer to all thereof and the obligations of all thereof
hereunder shall be joint and several.
IBM CREDIT AND GUARANTOR AGREE THAT ANY ACTION, SUIT, OR PROCEEDING,
RELATING DIRECTLY OR INDIRECTLY TO THIS GUARANTY INCLUDING ANY COUNTERCLAIMS, OR
THE RELATIONSHIP BETWEEN IBM CREDIT AND GUARANTOR, WILL BE TRIED IN A COURT OF
COMPETENT JURiSDICTION BY A JUDGE WITHOUT A JURY. THUS, IBM CREDIT AND
GUARANTOR HEREBY WAIVE ANY RIGHT TO A JURY TRIAL IN ANY SUCH ACTION, SUIT OR
PROCEEDING.
WITNESS INET SYSTEMS, INC.
-----------------------------------
Name of Corporate Guarantor
______________________________________ By: /s/ Xxxxx X. Xxxxx
--------------------------------
Print Name:___________________________ Print Name: Xxxxx X. Xxxxx
------------------------
Address:______________________________ Title: Chief Financial Officer
-----------------------------
______________________________________ Guarantor's Address:_______________
______________________________________ ___________________________________
___________________________________
SEAL
ATTEST:
/s/ Xxxxx X. Xxxxx
-----------------------------------
Secretary
Print Name: Xxxxx X. Xxxxx
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STATE OF TEXAS )
) SS
COUNTY OF BEXAR )
On this 30th day of September, 1997, the above individuals personally appeared
before me, and who, being duly sworn, each stated that the foregoing Guaranty
was executed in each of their representative capacities as represented above for
the Guarantor.
/s/ Xxxxx Xxxxx
----------------------------------
Notary Public
My Commission Expires: ____________
NOTARY PUBLIC SEAL
FOR XXXXX XXXXX
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SECRETARY'S CERTIFICATE
I hereby certify that I am the Secretary of the following named corporation
and that execution of the above Guaranty was ratified, approved and confirmed by
the Shareholders at a meeting, if necessary, and pursuant to a resolution of the
Board of Directors of the corporation at a meeting of the Board of Directors
duly called, and which is currently in effect, which resolution was duly
presented, seconded and adopted and reads as follows:
"BE IT RESOLVED that any officer of this corporation is hereby authorized
to execute a guaranty of the obligations of Western Micro Technology, Inc.
("Dealer") to IBM Credit Corporation on behalf of the corporation, which
instrument may contain such terms as any officer may see fit including, but not
limited to a grant of a security interest in all assets of this corporation to
secure this corporation's liabilities and obligations to IBM Credit Corporation;
a waiver of notice of the acceptance of this guaranty; presentment; demand;
protest; notices of nonpayment, nonperformance, dishonor, the amount of
indebtedness of Dealer outstanding at any time, any legal proceedings against
Dealer, and any other demands and notices required by law; any right of
contribution from other guarantors; and all set-offs and counterclaims."
IN WITNESS WHEREOF and as Secretary of the named corporation I have
hereunto set my hand and affixed the corporate seal on this 30th day of
September, 1997.
/s/ Xxxxx X. Xxxxx
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(Secretary)
Xxxxx X. Xxxxx
-----------------------------------
(Corporate Guarantor)
CORPORATE SEAL
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