CONTINUING GUARANTEE
Exhibit
10.2
This
Continuing Guarantee ("Guarantee") is made as of May 18th, 2009, by ASTRATA
GROUP, INC., a Nevada corporation ("Guarantor"), in favor of Fame Trading Ltd.,
a British Virgin Islands company ("Lender").
RECITALS
A. The
Guarantor is the owner of 100% of the equity interests of Astrata (Asia Pacific)
Pte Ltd ("Borrower"). Concurrently herewith, Borrower has executed a Loan
Letter, a Debenture and Facility Agreement ("Loan"), dated May 15, 2009, in
favor of the Lender for the principal sum of $8,500,000.
B. In order to induce Lender to enter
into the Loan and make the loans provided for thereunder, and for other valuable
consideration, receipt of which is hereby acknowledged, Guarantor has agreed to
guarantee Borrower's obligations to Lender under the Loan and to indemnify
Lender as set forth in this Guarantee.
GUARANTEE
1. Guarantee of
Obligations. For valuable consideration, receipt of which is hereby
acknowledged. and subject to the provisions of this Guarantee, Guarantor hereby
irrevocably and unconditionally guarantees and promises to pay to Lender, or
order, on demand in lawful money of the United States of America, any and all of
Borrower's Obligations (as defined below) to Lender arising from or in
connection with the Loan in the event of Borrower's default under the Loan. The
word "Obligations" means (a) any and all existing and future obligations of
Borrower to Lender under the Loan and any and all other existing and future
obligations and liabilities of Borrower made, incurred or created in connection
with the Loan whether such obligations are absolute or contingent, voluntary or
involuntary, liquidated or unliquidated, determined or undetermined, whether
Borrower may be liable individually or jointly with others, whether recovery
upon such indebtedness may be or hereafter become barred by any statute of
limitations, or whether such indebtedness may be or hereafter become invalid or
otherwise unenforceable; (b) any and all amendments, modifications, renewals
and/or extensions of any of the foregoing, including, without limitation,
amendments, modifications, renewals or extensions which arc evidenced by a new
or additional instrument, document or agreement or which change the rate of
interest on any such indebtedness; and (c) any and all interest that accrues on
all or any part of such indebtedness after the filing of any petition or
pleading against Borrower or any other person for a proceeding under any chapter
or provision of any present or future federal bankruptcy legislation or
amendments thereto.
2. Independent
Obligations. The Guarantor's obligations hereunder are independent of the
obligations of Borrower, any other guarantor or any other person, and upon the
occurrence of a default under the Loan, Lender may enforce any of its rights
hereunder independently of any other right or remedy that Lender may at any time
hold with respect to the Obligations or any security or other guarantee
therefor. Without limiting the generality of the foregoing, Lender may bring a
separate action against Guarantor without first proceeding against Borrower, any
other guarantor or any other person, or any security held by Lender, and
regardless of whether Borrower or any other guarantor or any other person is
joined in any such action. Guarantor's liability hereunder shall at all times
remain effective with respect to the full amount of the Obligations
notwithstanding any limitations on the liability of Borrower to Lender contained
in the Loan or elsewhere. Lender's rights hereunder shall not be exhausted by
any action taken by Lender until all Obligations have been hilly paid and
performed. The liability of Guarantor hereunder shall be reinstated and revived,
and the rights of Lender shall continue, with respect to any amount at any time
paid on account of the Obligations which shall thereafter be required to be
restored or returned by Lender upon the bankruptcy, insolvency or reorganization
of Borrower, any other guarantor or any other person, or otherwise, all as
though such amount had not been paid.
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This is an irrevocable and
unconditional Guarantee of payment and performance.
3. Authority to Modify
Obligations. Guarantor authorizes Lender, at any time and from time to
time without notice to Guarantor and without affecting the liability of
Guarantor hereunder, to: (a) alter the terms of all or any part of the
Obligations and any security and Guarantee therefor, including, without
limitation, modification of times for payment and rates of interest; (b) accept
new or additional instruments, documents, agreements, security or guaranties in
connection with all or any part of the Obligations; (c) waive, release,
reconvey, terminate, abandon, subordinate, exchange, substitute, transfer,
compound, liquidate and enforce all or any part of the Obligations and any
security or guaranties therefor, and apply any such security and direct the
order or manner of sale thereof (and bid and purchase at any such sale), as
Lender in its discretion may determine; (d) release Borrower, any guarantor or
any other person from any personal liability with respect to all or any part of
the Obligations; and (e) assign this Guarantee in whole or in part.
4. Waivers. Guarantor
hereby waives each of the following, to the fullest extent allowed by
law:
(a) all statutes of
limitations as a defense to any action brought against Guarantor;
(b) any defense based
upon:
(i) the
unenforceability or invalidity of all or any part of the Obligations or any
security or other guarantee for the Obligations or the lack of perfection or
failure of priority of any security for the Obligations; or
(ii) any
act or omission of Lender or any other person that directly or indirectly
results in the discharge or release of Borrower or any other person with respect
to any of the Obligations or any security therefor; or
(iii) any
disability or any other defense of Borrower or any other person with respect to
the Obligations, whether consensual or arising by operation of law or any
bankruptcy, insolvency or debtor-relief proceeding, or from any other
cause;
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(c) any
right (whether now or hereafter existing) to require Lender, as a condition to
the enforcement of this Guarantee, to:
(i) accelerate the
Obligations; or
(ii) give notice to Guarantor of
the terms, time and place of any public or private sale of any security for the
Obligations; or
(iii) proceed against Borrower,
any other guarantor or any other person, or proceed against or exhaust any
security for the Obligations.
(d) until
all Obligations are paid in full, (i) all rights of subrogation, (ii) all rights
to enforce any remedy that Lender now or hereafter has against Borrower or any
other person, and (iii) any benefit of, and right to participate in, any
security now or hereafter held by Lender with respect to the
Obligations;
(e) presentment,
demand, protest and notice of any kind, including, without limitation, notices
of default and notice of acceptance of this Guarantee;
(f) all
suretyship defenses of every nature otherwise available under California law and
the laws of any other state, including, without limitation, all defenses arising
under Sections 2787 through 2855 of the California Civil Code and any successor
provisions to these Sections, and any and all benefits which might otherwise be
available under California Civil Code Sections 2809, 2810, 2819, 2845, 2847,
2848, 2850, 2899 and 3433, or under California Code of Civil Procedure Sections
580(a), 580(b), 580(d) and 726 and any successor provisions to these
Sections;
(g) any
duty of Lender to disclose to Guarantor any facts that they presently have
knowledge of or may hereafter acquire knowledge of regardless of whether Lender
has reason to believe that had Guarantor known of such facts they would have
affected Guarantor's decision to enter into this Guarantee ; and
(h) all
other rights and defenses the assertion or exercise of which would in any way
diminish the liability of Guarantor hereunder, except as otherwise specifically
provided in this Guarantee.
(i) an
rights and remedies accorded by applicable law to guarantors (and Guarantor
agrees not to assert or take advantage of any such rights or remedies) to
require Lender to proceed against Borrower or any other person or to proceed
against or exhaust any security held by Lender at any time or to pursue any
other remedy in Lender's power before proceeding against Guarantor, any defense
that may arise by reason of the incapacity, lack of authority, death or
disability of any other person or persons or the failure of Lender to file or
enforce a claim against the estate (in administration, bankruptcy or any other
proceeding) of any other person or persons; demand, protest and notice of any
kind, including, without limitation, notice of the existence, creation or
incurring of any new or additional indebtedness or obligation or of any action
or non-action on the part of Borrower, Lender, any endorser or creditor of
Borrower or Guarantor or on the part of any other person whomsoever under this
or any other instrument in connection with any obligation or evidence of
indebtedness held by Lender or in connection with any Obligations hereby
guaranteed; all rights and defenses arising out of an election of remedies by
Lender, even though that election of remedies has destroyed the Guarantor's
rights of subrogation and reimbursement against the principal by operation of
applicable law; and any defense based upon any statute or rule of law which
provides that the obligation of a surety must be neither larger in amount nor in
other respects more burdensome than that of the principal.
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5. Relationship of
Parties. Guarantor represents and warrants to Lender that: (a) Guarantor
has received a copy of the Loan and is familiar with and fully understands all
of their terms and conditions; (b) Lender has not made any representation or
warranty to Guarantor regarding the creditworthiness of Borrower or the
prospects of repayment from sources other than Borrower; (c) this Guarantee is
executed at the request of Borrower; (d) Guarantor has established adequate
means of obtaining from Borrower on a continuing basis financial and other
information pertaining to the business of Borrower; and (e) Guarantor assumes
full responsibility for keeping fully informed with respect to the business,
operation, condition and assets of Borrower. Guarantor hereby agrees that Lender
shall have no duty to disclose or report to Guarantor any information now or
hereafter known to Lender relating to the business, operation, condition or
assets of Borrower. Lender shall have no duty to inquire into the authority or
powers of Borrower or any officer, employee or agent of Borrower with regard to
any Obligations, and all Obligations made or created in good faith reliance upon
the professed exercise of any such authority or powers shall be guaranteed
hereunder.
6. Subordination. Until
all of the Obligations have been paid in full, Guarantor agrees that all
existing and future debts, obligations and liabilities of the Borrower to
Guarantor (hereinafter collectively referred to as "Subordinated Debt") shall be
and hereby are expressly subordinated to the Obligations, and the payment
thereof are expressly deferred in right of payment to the prior payment in full
of the Obligations. For purposes of this Section 6, the Obligations shaft not be
deemed paid in full unless and until they have been paid in full in
cash.
(a) Upon
any distribution of assets of Borrower, upon any dissolution, winding up,
liquidation or reorganization of Borrower, whether in bankruptcy, insolvency,
reorganization or receivership proceedings, or upon an assignment for the
benefit of creditors or any other marshalling of the assets or liabilities of
Borrower, or otherwise:
(i) the
holders of the Obligations shall be entitled to receive payment in full of the
Obligations before Guarantor is entitled to receive any payment on account of
the Subordinated Debt;
(ii) any
payment by or distribution of assets of Borrower of any kind or character,
whether in cash, property or securities, to which Guarantor would be entitled
except for this subordination shall be paid or delivered by the person making
such payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee, or otherwise, directly to the holder of the Obligations to
be held as additional security for the Obligations in an interest bearing
account until the Obligations have been paid in full; and
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(iii) if,
notwithstanding the foregoing, any payment by, or distribution of assets of,
Borrower of any kind or character, whether in cash, property or securities, in
respect of any Subordinated Debt shall be received by Guarantor before the
Obligations arc paid in full, such payment or distribution shall be held in
trust and immediately paid over in kind to the holders of the Obligations in an
interest bearing account until the Obligations have been paid in
full.
(b)
Guarantor authorizes and directs Borrower to take such action as may be
necessary or appropriate to effectuate and maintain the subordination provided
herein.
(c) No
rights of any holder of the Obligations to enforce the subordination herein
shall at any time or in any way be prejudiced or impaired by any act or failure
to act on the part of Borrower, Lender or any other person or by any
noncompliance by the Borrower, Lender or any other person with the terms,
provisions and covenants hereof or the Loan regardless of any knowledge thereof
that any such holder of the Obligations may have or be otherwise charged
with.
(d) Nothing
express or implied herein shall give any person other than Borrower, Lender and
Guarantor any benefit or any legal or equitable right, remedy or claim
hereunder.
(e) If
Guarantor shall institute or participate in any suit, action or proceeding
against Borrower in violation of the terms hereof, Borrower may interpose this
Guarantee as a complete defense and the Borrower and the holder of the
Obligations are irrevocably authorized to intervene and to interpose such
defense or pleading in their name or in Borrowers name.
7.
Representations and
Warranties. Guarantor represents and warrants to Lender
that:
7.1 Execution, Delivery and
Performance of Guarantee. Guarantor has all requisite power and authority
to execute, deliver, and perform all of its obligations under this Guarantee.
The execution, delivery, and performance by Guarantor of all of its obligations
under this Guarantee do not and will not:
(a)
result in or require the creation nor imposition of any lien, right of others,
or other encumbrance of any nature (other than under this Guarantee and any
related security documents) upon or with respect to any property now owned or
leased or hereafter acquired by Guarantor,
(b)
violate any provision of any law, regulation, judgment, decree or award
presently in effect having applicability to this Guarantee; or
(c) result
in a breach of, constitute a default under, cause or permit the acceleration of
any obligation owed under, any loan agreement, lease, or any other agreement or
instrument, to which Guarantor is a party or by which Guarantor or any of its
property is bound or affected.
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7.3 Enforceability. This
Guarantee, when executed and delivered, shall constitute the valid and binding
obligation of Guarantor, enforceable in accordance with its terms.
7.4 Compliance With
Agreements. Guarantor has complied in all material respects with all loan
agreements and all instruments to which Guarantor is a party or by which
Guarantor or any of its property is bound or affected.
7.5 Litigation. There are
no material actions, suits or proceedings pending or threatened against or
affecting Guarantor or any property of Guarantor before any court or
governmental department, public body or authority.
8. Notice of Certain
Events. Guarantor shall give notice to Lender promptly (in any event
within five (5) days after Guarantor learns of same) of the institution of any
litigation or legal or administrative proceeding or investigation pending
against and materially affecting Guarantor, or any of Guarantor's
properties.
9. Security Agreement.
This Guarantee is secured by a pledge of all of Guarantor's stock in the
Borrower, as evidenced by that certain "Pledge Agreement" dated as of the date
hereof.
10. Reasonableness and Effect of
Waivers. Guarantor warrants and agrees that each of the waivers set forth
in this Guarantee is made with full knowledge of its significance and
consequences and that, under the circumstances, the waivers are reasonable and
not contrary to public policy or law. if any of such waivers are determined to
be contrary to any applicable law or public policy, such waivers shall be
effective only to the maximum extent permitted by law.
11. Exercise of Remedies;
Cumulative Remedies: No Waiver. The rights, powers and remedies of Lender
hereunder are cumulative and not exclusive of any other right, power or remedy
which Lender would otherwise have. No failure or delay on the part of Lender in
exercising any such right, power or remedy may be, or may be deemed to be, a
waiver thereof; nor may any single or partial exercise of any such tight, power
or remedy preclude any other right, power or remedy hereunder or related
documents.
12. Costs and Expenses of
Enforcement. Guarantor agrees to pay to Lender, on demand, all costs and
expenses, including reasonable attorneys' fees, incurred by Lender in exercising
any right, power or remedy conferred by this Guarantee, or in the enforcement of
this Guarantee, whether or not any action is filed in connection therewith.
Until paid to Lender. such amounts shall bear interest. commencing with Lender's
demand therefor, at the default rate of interest set forth in the Note or if
there is no such default rate, at the rate of interest set forth in the
Note.
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13. Binding, Agreement;
Assignment; Amendment. This Guarantee and the terms, covenants and
conditions hereof shall be binding upon and inure to the benefit of Guarantor,
Lender and their respective successors and assigns, except that Guarantor shall
not be permitted to transfer, convey or assign this Guarantee or any right or
obligation hereunder without the prior written consent of Lender (and any
attempt to do so shall be void). Lender may assign its interest hereunder in
whole or in part. Neither this Guarantee nor any provision hereof may be
amended, modified, waived, discharged or terminated except by an instrument in
writing duly signed by or on behalf of Lender.
14. Severability. In the
event that any right or remedy of Lender hereunder is held to be invalid,
illegal or unenforceable, such invalidity, illegality or unenforceability shall
not affect any other right or remedy granted hereunder.
15. Governing Law. This
Guarantee shall be governed by, and construed and enforced in accordance with,
the laws of the State of California.
16. Meaning of Terms;
Interpretations. Unless otherwise defined herein, capitalized terms used
in this Guarantee have the meaning given to them in the Loan. Whenever the
context requires, all terms used herein in the singular shall be construed in
the plural and vice versa, and each gender shall include each other gender. The
term "Borrower" shall mean the named Borrower and any other person or entity at
any time and from time to time assuming or otherwise becoming primarily liable
on all or any part of the Obligations. Section headings in this Guarantee are
included for convenience of reference only and are not a part of this Guarantee
for any other purpose.
IN WITNESS WHEREOF, Guarantor has
caused this Guarantee to be duly executed as of the date first written
above.
"GUARANTOR"
ASTRATA
GROUP, INC.
A Nevada
corporation
By: /s/
signature
Its:
Chairman & CEO
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