1
EXHIBIT 10.19
CONTINUING GUARANTY
THIS CONTINUING GUARANTY AGREEMENT ("Guaranty") is executed by
XXXXXXXXXXXXXXX.XXX, a Delaware corporation ("Guarantor"), in favor of LEASE
MANAGEMENT ASSOCIATES, INC., a Nevada corporation ("Lender"), at the request of
RESOURCE/PHOENIX, INC., a California corporation ("Borrower").
WHEREAS, Lender will make loans to Borrower secured by certain property which
may be personal property, real property or other items pursuant to a Senior Loan
and Security Agreement No. 4673 dated as of June 23, 2000, ("Security
Agreement") which term "Security Agreement" in this Guaranty includes any and
all promissory notes and other agreements now or hereafter executed by Borrower
in connection with the Security Agreement between Lender and Borrower.
WHEREAS, Guarantor acknowledges that Lender would not enter into the Security
Agreement or make any loans to Borrower pursuant thereto, unless Guarantor
enters into and delivers this Guaranty.
WHEREAS, it is of a business benefit to Guarantor that Lender make the loans
under the Security Agreement to Borrower.
NOW, THEREFORE, to induce Lender to enter into the Security Agreement with
Borrower, and in consideration of the benefits accruing from the Security
Agreement to Guarantor by virtue of its business relationship with Borrower and
for other good and valuable consideration, receipt of which is hereby
acknowledged, Guarantor agrees, subject to the Terms and Conditions of
Continuing Guaranty attached hereto and made a part hereof, (i) to guaranty the
full satisfaction and payment of Borrower's Obligations (as defined in such
Terms and Conditions) to Lender and (ii) to be liable for, and legally bound by,
all other terms, conditions, covenants and obligations set forth in such Terms
and Conditions.
IN WITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty on the
date set forth below, and by such signature acknowledges and agrees that
Guarantor has read and is in agreement with the attached Terms and Conditions of
Continuing Guaranty.
DATED: June 23, 2000
-----------------------------------------
XXXXXXXXXXXXXXX.XXX ("Guarantor")
By: /s/ Xxxxxxx Xxxxxxxx
--------------------------------------------
Title: Vice President & Chief Financial Officer
-----------------------------------------
2
TERMS AND CONDITIONS OF CONTINUING GUARANTY
1. OBLIGATIONS DEFINED. The term "Obligations" is used throughout this
Guaranty in its most comprehensive sense and means and includes, without
limitation, any and all obligations and liabilities of any kind or nature owed
by Borrower to Lender pursuant to the Security Agreement and any financial or
other accommodations extended by Lender to Borrower, heretofore, now or
hereafter made, incurred or created, whether voluntary or involuntary and
however arising or evidenced, whether owed directly to Lender or acquired by
Lender through assignment, subrogation or succession, whether due or not due,
absolute or contingent, liquidated or unliquidated, determined or undetermined,
secured or unsecured, whether on original, renewed, extended or revised terms,
whether principal, interest or fees (including, but not limited to, those
changing the applicable rate of interest or which release any obligor with
respect to any Obligations, whether such indebtedness is from time to time
reduced or extinguished and thereafter increased or incurred), whether Borrower
may be individually or jointly liable with others, whether such obligations or
any portion thereof becomes barred by any statute of limitations and whether
such obligations may be or hereafter become unenforceable. If a petition under
the U.S. Bankruptcy Code is filed by or against Borrower, the term "Borrower"
shall also mean and include Borrower in its status as a "debtor" and
"debtor-in-possession" under the U.S. Bankruptcy Code.
2. GUARANTOR OBLIGATIONS. Guarantor's liability hereunder shall be unlimited.
Guarantor absolutely and unconditionally guarantees and promises to perform, on
demand, without set-off or deduction, (a) the prompt payment when due, whether
upon maturity, acceleration or otherwise, of all amounts payable by Borrower
pursuant to the Security Agreement, the guaranty under this clause constituting
a guaranty of payment and not of collection; (b) the punctual performance by
Borrower of each and every duty, agreement, covenant or other Obligations of
Borrower under the Security Agreement; and (c) all other Obligations of Borrower
to Lender.
3. GUARANTOR LIABILITIES. The liabilities of Guarantor are primary and
independent of the Obligations, and a separate action may be brought and
prosecuted against Guarantor whether such action is brought against Borrower or
any other guarantor or whether Borrower is joined in any such action. The
liability under this Guaranty is exclusive of liability under any other
guaranties executed by Guarantor for the benefit of Lender or any company
related to Lender.
4. AUTHORIZATION OF GUARANTOR. Guarantor authorizes Lender, in its
discretion, without notice or demand and without impairing, discharging or
affecting its liability hereunder, from time to time, to:
(a) change the time or manner of payment of any Obligations by renewal,
compromise, extension, acceleration or otherwise;
(b) as provided for by the terms and conditions of the Security
Agreement or other documentation between Lender and Borrower, alter or change
any other provision of any Obligations, including the rate of interest thereon;
(c) release, substitute, or add one or more endorsers, co-signers,
guarantors, or other obligors with respect to any Obligations:
(d) obtain collateral for the payment of any Obligations or any guaranty
thereof;
(e) release, exchange, enforce, waive, substitute, or modify, in whole
or in part, existing or after-acquired collateral securing payment of the
Obligations or any guaranty therefor on such terms as Lender at its sole
discretion shall determine;
(f) apply any sums received from Borrower, any other guarantor, endorser
or co-signer or from the sale or collection of collateral or its proceeds to any
indebtedness whatsoever in any order and regardless of whether or not such
indebtedness is guaranteed hereby, is secured by collateral or is due and
payable;
(g) apply any sums received from Guarantor or from the sale of
collateral granted by Guarantor to any, all, or any portion of the Obligations
in any order regardless of whether the Obligations are secured by collateral or
are due and payable;
(h) accept partial payment on any Obligations;
(i) amend or modify the terms of any guaranty of the Obligations,
including the maximum liability thereunder;
(j) subordinate payment of all or any part of the Obligations to other
creditors of Borrower or other persons on such terms as Lender deems
appropriate; and
(k) exercise any right or remedy it may have with respect to any
Obligations or any collateral securing any Obligations, this Guaranty, or any
other guaranty (including, but not limited to, or, taking a deed or assignment
in lieu of foreclosure as to any collateral, purchasing at any sale of any such
collateral, and compromising, collecting, or otherwise liquidating any
collateral or any Obligations) without affecting or impairing in any way the
liability of Guarantor.
5. GUARANTY ABSOLUTE; WAIVERS.
(a) Guarantor acknowledges that Guarantor may have certain rights under
applicable law which, if not waived by Guarantor, might provide Guarantor with
defenses against Guarantor's liability under this Guaranty. Among those rights,
are certain rights of subrogation, reimbursement, indemnification and
contribution, and rights provided in sections 2787 to 2855, inclusive, of the
California Civil Code. Guarantor waives all of Guarantor's rights of
subrogation, reimbursement, indemnification, and contribution, and any other
rights and defenses that are or may become available to Guarantor by reason of
any or all of California Civil Code sections
3
2787 to 2855, inclusive, including, without limitation, Guarantor's rights:
(i) To require Lender to notify Guarantor of any default by Borrower,
provide Guarantor with notice of any sale or other disposition of security for
any Obligations, or disclose information with respect to the Obligations, the
Borrower, or any other guarantor, co-signer or endorser, or with respect to any
collateral;
(ii) That Guarantor's obligation under this Guaranty must be
commensurate with that of Borrower;
(iii) To be discharged based upon the absence of any liability of the
Borrower, at any time, by virtue of operation of law, or otherwise, or due to
any other disability or defense of Borrower or any other guarantor, endorser or
co-signer;
(iv) To be discharged if any of the terms, conditions or provisions of
the Obligations are altered in any respect;
(v) To be discharged upon acceptance by Lender of anything in partial
satisfaction of the Obligations, and/or if Lender designates the portion of the
Obligations to be satisfied;
(vi) To be discharged upon any modification of the Obligations or the
release by Lender of Borrower or any other guarantor, endorser or co-signer, or
if any remedies against any such person are suspended or impaired;
(vii) To require Lender to proceed against Borrower, or any other
guarantor, endorser, co-signer, or other person, or to pursue or refrain from
pursuing any other remedy in Lender's power;
(viii) To receive the benefit of or participate in any and all security
for repayment and/or performance of the Obligations;
(ix) To have any security for the Obligations first applied to satisfy
or discharge the Obligations;
(x) That any arbitration award rendered against Borrower not constitute
an award against Guarantor;
(xi) To be discharged based upon any failure by Lender to perfect or
continue perfection of any lien, use due diligence to collect all or any
Obligations, or if recovery against Borrower becomes barred by any statute of
limitations, or if Borrower is not liable for any deficiency after Lender
realizes upon any collateral; and
(xii) To be discharged due to the release or discharge of any collateral
for any Obligations or guaranty, or relating to the validity, value or
enforceability of any collateral.
(b) Guarantor also waives all rights and defenses that Guarantor may
have because the Borrower's debt is secured by real property. This means, among
other things: (i) Lender may collect from Guarantor without first foreclosing on
any real or personal property collateral pledged by Borrower; (ii) If Lender
forecloses on any real property collateral pledged by the Borrower: (A) The
amount of the debt may be reduced only by the price for which that collateral is
sold at the foreclosure sale, even if the collateral is worth more than the sale
price, (B) Lender may collect from Guarantor even if Lender, by foreclosing on
the real property collateral, has destroyed any right Guarantor may have to
collect from Borrower. This is an unconditional and irrevocable waiver of any
rights and defenses Guarantor may have because Borrower's debt is secured by
real property. These rights and defenses include, but are not limited to, any
rights or defenses directly or indirectly based upon Section 580a, 580b, 580d,
or 726 of the California Code of Civil Procedure.
(c) Guarantor also waives all rights and defenses arising out of an
election of remedies by Lender, 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 the
principal by the operation of Section 580d of the California Code of Civil
Procedure or otherwise.
(d) To the maximum extent permitted by law, Guarantor further waives any
and all rights to receive any notice of judicial or nonjudicial sale or
foreclosure of any real or personal property that may be the subject of any
security instrument or that may secure obligations of any other guarantor to
Lender, and Guarantor's failure to receive any such notice shall not impair or
affect Guarantor's liability. Notwithstanding any foreclosure of the lien of any
security instrument, with respect to the Obligations or any other guaranty,
whether by the exercise of the power of sale contained therein, by any action
for judicial foreclosure, or by any acceptance of a deed or other transfer in
lieu of foreclosure, whether or not such method of foreclosure or transfer in
lieu of foreclosure was for a consideration equal to or greater than the fair
market value of the security property, Guarantor shall remain bound under this
Guaranty for the Obligations of Borrower to Lender and shall be liable to Lender
for any and all of the Obligations remaining unpaid after any such foreclosure.
(e) If for any reason Borrower is under no legal obligation to discharge
any of the Obligations, or if any of the Obligations have become irrecoverable
from Borrower for any reason, this Guaranty shall nevertheless be binding on
Guarantor to the same extent as if the Guarantor at all times had been the
primary obligor on all such Obligations.
(f) In the event (i) Borrower defaults in the payment of any of the
Obligations or (ii) acceleration of the time for payment of any of the
Obligations is stayed upon the insolvency, bankruptcy or reorganization of the
Borrower, or for any other reason, all such amounts otherwise subject to
acceleration under the agreement evidencing such Obligations, shall be
immediately due and payable by Guarantor. Guarantor waives all presentments,
demands for performance, notices of nonperformance, protests, notices of
protest, dishonor and acceptance of this Guaranty.
6. NO WARRANTIES OF LENDER. Guarantor acknowledges and affirms that this
Guaranty is not made in reliance on any representation or warranty, express or
implied, by Lender concerning the financial condition of Borrower, the nature,
value or extent of any security for indebtedness, or any other matter. Guarantor
warrants and
4
represents to Lender that Guarantor has full knowledge of the financial
condition of Borrower and agrees that Guarantor has established adequate means
and assumes the responsibility for being and keeping informed of the financial
condition of Borrower and of all other circumstances bearing upon the risk of
non-payment of the Obligations that diligent inquiry would reveal, including any
renewals, extensions of the Obligations or any future Obligations, and Lender
has no obligation to advise Guarantor of any information relating to Borrower's
financial condition or otherwise relating to Borrower or the indebtedness or
security therefor.
7. LENDER SECURITY. Any and all indebtedness of Borrower now or hereafter
owed to Guarantor and all claims whenever arising of Guarantor against Borrower
are hereby subordinated to the Obligations and assigned to Lender as additional
collateral. If Lender so requests, any note or other instrument evidencing such
indebtedness and all claims of Guarantor against Borrower shall be delivered to
Lender, and such indebtedness and all claims of Guarantor against Borrower shall
be collected, enforced and received by Guarantor as trustee for Lender and be
paid over to Lender on account of the Obligations but without reducing or
affecting in any manner the liability of Guarantor hereunder. Should Guarantor
fail to collect proceeds of debt owed to Guarantor by Borrower, or fail to pay
any such proceeds received by Guarantor pursuant to this Section 7 or otherwise
to Lender, Lender as Guarantor's attorney-in-fact may do such acts and sign such
documents in Guarantor's name as Lender considers necessary to effect such
collection, and Guarantor hereby irrevocably appoints Lender as Guarantor's
attorney-in-fact for such purposes.
8. LENDER EXPENSE. Guarantor agrees to pay Lender on demand reasonable
attorneys' fees and all other costs and expenses which may be incurred (a) in
the collection or attempted collection from Borrower of any of the Obligations
and in the enforcement or attempted enforcement by Lender of this Guaranty or
any collateral therefor, whether or not legal proceedings are instituted, and
including, without limitation, a reasonable estimate of the allocated cost of
Lender's in-house legal counsel and staff and other legal expenses, and (b) in
connection with any bankruptcy or post-judgment proceeding, whether or not suit
is filed and, including, without limitation, those incurred in each and every
action, suit or proceeding, including any and all appeals and petitions
therefrom.
9. MULTIPLE GUARANTORS. When a single Guarantor executes this Guaranty, any
words used herein in the plural shall be deemed to have been used in the
singular where the context and construction so require. When this Guaranty is
executed by more than one Guarantor, the word "Guarantor" shall mean all and any
one or more of them and such Guarantors shall be jointly and severally liable
for any and all Obligations hereunder. The Obligations of Guarantor hereunder
are in addition to any Obligations of any one or more other guarantors under any
other guaranties and the liability of Guarantor to Lender shall be the aggregate
liability of said Guarantor under the terms of this Guaranty and all of said
other guaranties.
10. REVIVAL OF PRIOR PAYMENTS. Guarantor agrees that to the extent Borrower
makes a payment or payments to, or is credited for any payment or payments made
for or on behalf of Borrower to Lender, which payment or payments, or any part
thereof, is subsequently invalidated, determined to be fraudulent or
preferential, set aside and/or required to be repaid to any trustee, receiver,
assignee or any other party whether under any Bankruptcy, State or Federal Law,
common law or equitable cause or otherwise, then to the extent thereof, the
Obligations or part thereof intended to be satisfied thereby, shall be revived,
reinstated and continued in full force and effect as if said payment or payments
had not originally been made by or on behalf of Borrower and this Guaranty shall
continue to be effective or shall be reinstated, as applicable, with respect
thereto.
11. BORROWER AUTHORITY. If Borrower is a corporation, a partnership, trust, or
limited liability company, Lender shall have no duty to inquire into the powers
of Borrower or the officers, directors, partners, trustees, members, managers,
or agents acting or purporting to act on its behalf, and any document entered
into pursuant to the Security Agreement or any other Obligations incurred upon
the purported exercise of such power or authority is hereby guaranteed
hereunder.
12. NO LENDER WAIVER. No failure or delay on the part of Lender in exercising
any right, power or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy preclude
any other or further exercise of any such right, power or remedy hereunder or
provided by law or separate agreement. No modification or waiver of any
provision of this Guaranty, nor consent to any departure by Guarantor therefrom
or release of any security or right of setoff granted hereby, shall be effective
unless in a writing signed by Lender and then such waiver or consent shall be
effective only in the specific instances and for the specific purposes given.
13. GUARANTY BINDING; LENDER ASSIGNMENT. All parts of this Guaranty shall be
binding upon Guarantor and Guarantor's heirs, executors, administrators,
successors and assigns; provided however, Guarantor may not assign its
Obligations hereunder. This Guaranty shall inure to the benefit of Lender and
its successors and assigns and Lender may assign or otherwise transfer without
notice to Guarantor all or any part of the Obligations and this Guaranty, and
may transfer therewith the whole or any part of any security for the Obligations
and this Guaranty.
14. GUARANTOR COMMITMENT. Each Guarantor acknowledges receipt of a true copy
of this Guaranty. Guarantor agrees this Guaranty shall be effective without
notice from Lender of its acceptance of the Guaranty. Guarantor understands and
agrees that this Guaranty is not a commitment by Lender to enter into the
Security Agreement, to renew or extend the Security Agreement, to extend
additional credit to Borrower, or extend financial accommodations to Borrower.
15. RELIANCE BY LENDER. Guarantor acknowledges that Lender has or may in the
future extend credit to Borrower in reliance on Guarantor's unconditional
promise to repay any and all Obligations, and Lender is relying on the waivers,
warranties, and promises made by Guarantor in this Guaranty. Guarantor agrees
that each of the waivers, warranties, and promises set forth in this Guaranty
are made with Guarantor's understanding of their significance and consequences
5
and that they are reasonable. If any waivers, warranties and promises are
determined to be contrary to any applicable law or public policy, such waivers,
warranties, and promises shall be effective to the maximum extent permitted by
law. Before signing the Guaranty, Guarantor has either sought the advice of
counsel to explain the waivers of Guarantor's rights and defenses as stated
herein and the effect thereof, or has had the opportunity to seek such counsel,
and in any event intends this Guaranty to be as unrestricted as possible.
Guarantor has therefore consciously and intentionally waived all defenses of
Guarantor and rights that could exonerate Guarantor hereunder to the full extent
permitted by the laws of the State of California, whether or not each and every
defense, right, or waiver is explained or described in detail in this Guaranty.
16. SEVERABILITY. Should any one or more provisions of this Guaranty be
determined to be illegal or unenforceable, all other provisions shall remain
effective.
17. CONTINUING GUARANTY. This is a continuing Guaranty. Revocation by
Guarantor shall be effective only upon the close of the next business day after
written notice thereof is received by an officer of Lender at 0000 Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx, Xxxxxxxxxx, 00000, Attention: Asset Management, by
certified or registered mail, return receipt requested and, subject to Section
10 hereof, any such revocation shall be effective only as to Obligations arising
after the next business day after the notice of revocation was received by an
officer of the Lender in accordance with this Section 19. Such notice shall be
delivered to any other office of Lender designated in a written notice mailed by
Lender to Guarantor at its address set forth below.
18. CALIFORNIA LAW. This Guaranty shall be deemed to have been made under and
shall be governed by the laws of the State of California in all respects,
including matters of construction, validity and performance. At Lender's sole
discretion, option and election, jurisdiction and venue for any legal action
between the parties arising out of or relating to this Guaranty shall be in the
Superior Court of Marin County, California, or, in cases where federal diversity
jurisdiction is available, in the United States District Court for the Northern
District of California located in San Francisco, California.
19. WAIVER OF RIGHT TO JURY TRIAL. GUARANTOR, TO THE EXTENT IT MAY LAWFULLY DO
SO, HEREBY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH
RESPECT TO THIS GUARANTY OR ANY AGREEMENT EXECUTED IN CONNECTION HEREWITH.
