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EXHIBIT 8.7
CONTINUING AND UNCONDITIONAL GUARANTY AGREEMENT
(GUARANTOR: TEXAS TBS, INC.)
THIS AGREEMENT, made and entered into effective the 11th day of
November, 1998, by and between TEXAS TBS, INC. (together "Guarantor" herein),
whose address is ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ("Obligee" herein), individually and as Agent for the Other
Shareholders, whose address for purposes of this agreement is ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, in ▇▇▇▇▇▇ County, Texas, regarding certain performance of
MEGAWORLD, INC. ("Obligor" herein); WITNESSETH THAT the parties hereto have
agreed as follows:
1. Guaranty. For value received, and as an inducement to the execution
by Obligee and TBS of that certain Acquisition / Merger Agreement dated November
11, 1998, by and between Obligor, TOTAL BUILDING SYSTEMS, INC. ("TBS" herein)
and Obligee, Guarantor unconditionally guarantees, without any limitation
whatsoever, to Obligee, its successors or assigns:
A. The full and punctual performance when due (whether by
acceleration or otherwise) of all obligations of Obligor (when and as
any of such obligations shall be or become due and/or owing by Obligor)
evidenced by and/or existing or to become existing under and by reason
of any of the following instruments, agreements and documents and any
extensions, modifications, renewals, and rearrangements thereof,
amendments and modifications thereto, and substitutions therefor
(together "Obligation Documents" herein):
(i) The said Acquisition / Merger Agreement,
including without limitation any and all obligations under the
said Acquisition / Merger Agreement, all instruments
referenced in Exhibit A thereto, and all other instruments
related to the transaction therein described, and
(ii) That certain Security Agreement and Financing
Statement ("Security Agreement" herein) of even date herewith
by and between Obligor, as Debtor therein, and Obligee, as
Secured Party therein; and
(iii) Each and every instrument, agreement, or
document executed by Obligor in connection with, or to grant
security for, obligations evidenced by the above described
Acquisition / Merger Agreement and Security Agreement,
including without limitation all instruments listed in Exhibit
A to the said Acquisition / Merger Agreement; and
(iv) Any other instrument, agreement, or document
executed by Obligor, whether or not described herein as an
Obligation Document, in connection with any other obligation
to Obligee, specifically including without limitation future
loans and advances, and funding agreements, and further
including without limitation any instruments, agreements, or
documents effecting any extensions, renewals, and
rearrangements of any Obligation Document, amendments and
modifications thereto, and substitutions therefor;
effective until the same have been performed, paid, and satisfied in
full. It is expressly agreed and confirmed that the guarantees by
Guarantor hereunder shall survive beyond payment of money and delivery
of shares by Obligor to Obligee under 2.1.3 of the said Acquisition /
Merger Agreement, and until all obligations of Obligor under any of the
Obligation Documents have been fully performed, paid, and satisfied.
The obligations of Obligor guaranteed hereunder include without
limitation all acts and omissions of all affiliates of Obligor which
Obligor is obligated to influence under any of the Obligation
Documents, such that should any affiliate fail to perform or forbear
from performing any act, or to effect or refrain from effecting any
result, which Obligor is obligated under any of the Obligation
Documents to influence, then such failure by such affiliate shall be
deemed a failure of the herein guaranteed performance by Obligor.
B. The prompt and complete performance in accordance with
their terms of any and all of the obligations of Obligor under each of
the Obligation Documents; and of all warranties, representations, and
covenants made by or imposed upon Obligor thereunder, and Guarantor
agrees that upon failure, refusal, or neglect of Obligor to fulfill any
obligation or covenant or maintain in effect any condition or fact as
warranted or covenanted, Guarantor will immediately do so.
As used herein the term "Guaranteed Obligations" means all obligations and
indebtedness of Obligor described in this Paragraph 1 as guaranteed by
Guarantor, including without limitation the acts and omissions of affiliates of
Obligor, as described in subparagraph 1.A above. This Guaranty Agreement shall
be in favor of each of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, and each of the Other Shareholders,
as defined in the said Security Agreement.
2. Term. The obligations of Guarantor as to the Guaranteed Obligations
shall continue in full force and effect against Guarantor for the unpaid balance
and the unperformed obligations guaranteed hereby until same are paid in full
and/or fully performed. This Guaranty covers any and all of the Guaranteed
Obligations, whether presently outstanding or arising subsequent to the date
hereof, including all amounts advanced by Obligee in stages or installments, and
all future loans and advances from Obligee to Obligor. This Guaranty is binding
upon and enforceable against Guarantor and the heirs, legal representatives,
personal representatives, executors, administrators, assigns, and successors of
Guarantor.
3. Waiver of Rights. Guarantor hereby waives (a) notice of acceptance
hereof (which acceptance is conclusively presumed by delivery of an executed
copy hereof to Obligee); (b) grace, demand, presentment, and protest with
respect to each and any of the Guaranteed Obligations or to any instrument,
agreement, or document evidencing or creating same; (c) notice of or as to
grace, demand, presentment, and protest; (d) notice of non-payment or other
defaults, of intention to accelerate, and of acceleration; (e) notice of and/or
any right to consent or object to the assignment of any interest in the
Guaranteed Obligations, the creation, advancement, accrual, renewal, increase,
extension, or rearrangement of the Guaranteed Obligations and the amendment
and/or modification of any of the instruments, agreements, and documents
executed in connection with the Guaranteed Obligations; (f) filing of suit and
diligence by Obligee in collection or enforcement of the Guaranteed Obligations;
(g) any obligation on the part of Obligee or any other party to proceed first
against Obligor in the enforcement of any Guaranteed Obligation; and (h) any
other notice regarding the Guaranteed Obligations.
4. Release of Collateral, Parties Liable, etc. Guarantor agrees that
Obligee may at any time, and from time to time, at Obligee's discretion and with
or without notice or consideration to or consent from any party: (a) allow
substitution
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or withdrawal of any collateral or other security for the Guaranteed
Obligations; (b) release, sell, or otherwise realize upon any collateral or
other security for the Guaranteed Obligations; (c) release any party liable on
the Guaranteed Obligations, including Obligor or any other guarantor; (d)
extend, renew, or rearrange all or any part of the Guaranteed Obligations at any
time and from time to time, whether or not for a term or terms in excess of the
original term thereof; and (e) modify or amend any of the instruments,
agreements, and documents executed in connection with the Guaranteed
Obligations. Any of such actions may be taken without impairing or diminishing
the obligations of Guarantor hereunder. The liability of Guarantor shall not be
impaired or reduced by Obligee's failure, refusal, or neglect to collect the
Guaranteed Obligations, or by loss or subordination of any other collateral or
guaranty, or by the existence of any indebtedness of Obligor to Obligee other
than the Guaranteed Obligations. In addition, the liability of Guarantor shall
not be impaired or reduced by the taking of any other security or guaranty for
the Guaranteed Obligations in addition to the security or guaranties presently
existing.
5. Primary Liability of Guarantor. This is a guaranty of payment and
performance, and Guarantor agrees that Obligee is not required, as a condition
to establishing Guarantor's liability hereunder, to proceed against any person
(including Obligor), or against any security or collateral to which Obligee is
entitled to look for payment and performance of the Guaranteed Obligations, and
further agrees not to assert any defense (other than payment or accord and
satisfaction) available to Obligor against Obligee with regard to the Guaranteed
Obligations, any defense based upon an election of remedies of any type, any
defense based on any duty of Obligee to disclose information of any type to
Guarantor regarding Obligor or the Guaranteed Obligations, and any claim that
Guarantor may have against Obligee by virtue of Obligee's failure to exercise
any rights against Obligor, however arising. Guarantor waives any right or claim
to force Obligee to proceed first against Obligor or any other guarantor as to
any of the Guaranteed Obligations or other obligations of Obligor. Obligor
agrees that no delay or refusal of Obligee to exercise any right or privilege
Obligee has or may have against Obligor (whether arising from any documents
executed by Obligor, or from any law, order, rule, or regulation, or otherwise)
shall operate to impair the liability of Guarantor hereunder. Guarantor agrees
that neither insanity, minority, other disability, bankruptcy, insolvency,
cessation of existence, or dissolution of Obligor, or of any party acting for or
on behalf of Obligor, or of any of the affiliates of Obligor, or of any other
guarantor now or hereafter existing in connection with the Guaranteed
Obligations, nor any allegation of fraud, usury, failure of consideration,
forgery, or other defense, whether or not known to Obligee (even though
rendering all or any part of the Guaranteed Obligations void or unenforceable or
uncollectible as against Obligor or any other guarantor) shall in any manner
impair, affect, or release the liability of Guarantor hereunder, and Guarantor
shall be and remain fully liable hereunder.
6. Subordination and Waiver of Subrogation. Guarantor hereby fully
subordinates the payment of all indebtedness and performance of all obligations
owing to Guarantor by Obligor (including principal and interest) to the prior
payment of all indebtedness and performance of all obligations of Obligor to
Obligee (including principal and interest, including interest accruing after any
insolvency or reorganization proceeding as to Obligor), and agrees not to accept
any payment on, or performance of, the same until payment in full of the
Guaranteed Obligations, at the option of Obligee, and not to attempt to set off
or reduce any obligations hereunder because of such indebtedness. Guarantor
further subordinates any lien or security interest that Guarantor may have on or
in any collateral or security now or hereafter securing payment of the
Guaranteed Obligations, to the liens on and security interests, if any, in such
collateral and security in favor of Obligee. Until all of the Guaranteed
Obligations shall have been paid or performed in full, Guarantor shall have no
right of subrogation or any other right to enforce any remedy which Obligee now
has or may hereafter have against Obligor, and Guarantor waives any benefit of,
or right to participate in, any security now or hereafter held by Obligee,
whether or not Guarantor has paid to or performed for Obligee any part less than
all of the Guaranteed Obligations.
7. Place of Performance: Attorneys' Fees. All payments to be made and
obligations to be performed hereunder shall be payable or performable at the
address of Obligee in the county and state specified herein, or as changed by
notice as hereinafter provided. If it becomes necessary for Obligee to enforce
this Guaranty by legal action, Guarantor hereby waives the right to be sued in
the county or state of Guarantor's residence and agrees to submit to the
jurisdiction and venue of the appropriate federal, state, or other governmental
court in such county and state of Obligee's address hereunder. Guarantor
unconditionally agrees to pay Obligee's collection expenses including court
costs and reasonable attorneys' fees if enforcement hereof is placed in the
hands of an attorney, including, but expressly not limited to, enforcement by
suit or through probate, bankruptcy, or any judicial proceedings.
8. Additional Liability of Guarantor. If Guarantor is or becomes liable
for any indebtedness of Obligor to Obligee other than the Guaranteed Obligations
by endorsement or otherwise than under this Guaranty, such liability shall not
be in any manner impaired or reduced hereby but shall have all and the same
force and effect it would have had if this Guaranty had not existed, and
Guarantor's liability hereunder shall not be in any manner impaired or reduced
thereby.
9. Cumulative Rights. All rights of Obligee hereunder or otherwise
arising under any documents executed in connection with or as security for the
Guaranteed Obligations are separate and cumulative and may be pursued
separately, successively, or concurrently, or not pursued, without affecting or
limiting any other right of Obligee and without affecting or impairing the
liability of Guarantor.
10. Governing Law; Jurisdiction and Venue. The laws of the State of
Texas shall govern the validity, construction, enforcement, and interpretation
hereof and the obligations, liabilities, rights, remedies, powers, and
privileges of the parties hereto under this agreement. Each party submits to the
personal jurisdiction of the state and federal courts sitting in Houston, ▇▇▇▇▇▇
County, Texas. This agreement is executed by the parties in ▇▇▇▇▇▇ County,
Texas; performance by Debtor is due in Houston, ▇▇▇▇▇▇ County, Texas; and venue
is permissive for all disputes arising hereunder in the federal and state courts
sitting in Houston, ▇▇▇▇▇▇ County, Texas.
11. Usury. Notwithstanding any other provisions herein contained, no
provision of this Guaranty shall require or permit the collection from Guarantor
of interest in excess of the maximum rate or amount that Guarantor may be
required or permitted to pay to Obligee pursuant to applicable law and as to
which Guarantor could not successfully assert the claim or defense of usury. The
parties hereto make a part hereof, as if set out herein, Paragraph 8 of the Deed
of Trust of even date herewith from Guarantor, as Grantor therein, to Obligee,
as Beneficiary therein.
12. Indebtedness Not Guaranteed. If, at any time, Obligor is indebted
to Obligee on obligations not guaranteed hereby ("Other Indebtedness"), (i)
Obligee may apply all sums received by Obligee from any source (other than from
realization on security provided under any document which expressly secures all
or any part of the Guaranteed Obligations, but does not secure Other
Indebtedness) to the Other Indebtedness before applying any of the same to the
Guaranteed Obligations; and (ii) Obligee without in any manner impairing its
rights hereunder may, at Obligee's option, exercise any right of offset first
against the Other Indebtedness.
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13. Obligee's Assigns. This Guaranty is intended for and shall inure to
the benefit of Obligee and each and every person who shall from time to time be
or become the owner or holder or party entitled to receive or benefit from of
all or any part of the Guaranteed Obligations, and each and every reference
herein to "Obligee" shall include and refer to each and every successor or
assignee of Obligee at any time holding or owning or entitled to any part of or
any interest in any part of the Guaranteed Obligations. This Guaranty shall be
transferable and negotiable with the same force and effect, and to the same
extent, that the Guaranteed Obligations are transferable and negotiable, it
being understood and stipulated that upon assignment or transfer by Obligee of
any of the Guaranteed Obligations the legal holder or owner of said Guaranteed
Obligations (or a part thereof or interest therein thus transferred or assigned)
shall (except as otherwise stipulated by Obligee in its assignment or other
transfer) have and may exercise all of the rights granted to Obligee under this
Guaranty to the extent of that part of or interest in the Guaranteed Obligations
thus assigned or transferred.
14. Notices. Any notice under or by reason of this agreement shall be
in writing and shall be effective upon delivery to the party to whom it is
intended or upon either (a) the mailing thereof enclosed in a proper mailing
wrapper addressed to the party for whom it is intended, via certified or
registered mail, postage prepaid, to the address for that party stated above or
such subsequent address for that party hereunder, or (b) the depositing thereof
with a commercial delivery service, so wrapped and addressed, with the charges
arranged to be paid by shipper, or (c) the transmission thereof by telecopier or
facsimile machine, so long as a confirmation copy is thereafter mailed to the
addressee within three (3) days of completion of the transmission. The addresses
of the parties for purposes of notice shall be the addresses set out herein for
the respective parties, subject to notice of change of address as herein
provided.
15. Payments; Cash Equivalent. Obligee may apply any payments received
from any source against that portion of the Guaranteed Obligations (principal,
interest, court costs, attorneys' fees or other) in such priority and fashion as
Obligee may deem appropriate, in Obligee's sole and absolute discretion. Upon
invocation of any right of recovery by Obligee hereunder, each of the Secured
Obligations as to which Obligee's rights hereunder are invoked may be given, by
Obligee in Obligee's reasonable discretion, a cash value, as the cash equivalent
thereof, and that cash equivalent shall be the value to be satisfied by
Guarantor in lieu of other method of performance of the Secured Obligation or
Obligations not properly satisfied by Obligor, and interest shall accrue on the
cash equivalent of each such Secured Obligation from the date of breach by
Obligor until payment of the appropriate cash equivalent by Guarantor.
16. Limitation on Guaranty. This Guaranty is limited only in accordance
with the terms and conditions of Paragraph 1 above, if at all.
17. Multiple Guarantors. If there are more than one Guarantor named
above, the duties and obligations of Guarantor hereunder shall be joint and
several. This agreement shall apply to each Guarantor separately, just as if
that Guarantor had executed a separate agreement containing all of the terms and
conditions hereof. At any time and from time to time, Obligee may assert any
right or privilege hereunder, or pursue any remedy or remedies hereunder,
against any one or more Guarantors named herein without asserting or waiving any
one or more of those rights and privileges against any other of the Guarantors.
18. Multiple Counterparts. This Guaranty may be executed in any number
of counterparts, each of which shall be an original, but all of which together
shall constitute but one instrument.
IN WITNESS WHEREOF, this instrument is executed as of the date first
above written.
GUARANTOR:
TEXAS TBS, INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Name:
Office:
OBLIGEE:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, in the
capacities above-referenced
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