AMENDED AND RESTATED UNCONDITIONAL CONTINUING GUARANTY
AMENDED
AND RESTATED
THIS
AMENDED AND RESTATED UNCONDITIONAL CONTINUING GUARANTY (“Guaranty”)
is
executed as of January 23, 2008, by DETENTION
CONTRACTING GROUP, LTD.,
a Texas
limited partnership, ISI
DETENTION CONTRACTING GROUP, INC.,
a Texas
corporation, ISI
DETENTION CONTRACTING GROUP, INC.,
a
California corporation, ISI
DETENTION CONTRACTING GROUP, INC.,
a New
Mexico corporation, ISI
DETENTION SYSTEMS, INC.,
a Texas
corporation, ISI
SYSTEMS, LTD.,
a Texas
limited partnership, METROPLEX
CONTROL SYSTEMS, INC.,
a Texas
corporation, ISI
CONTROLS, LTD.,
a Texas
limited partnership, METROPLEX
COMMERCIAL FIRE AND SECURITY ALARMS, INC.,
a Texas
corporation and MCFSA,
LTD.,
a Texas
limited partnership (collectively, “Guarantor”),
for
the benefit of LASALLE
BANK NATIONAL ASSOCIATION
(“Bank”).
RECITALS
A. On
October 21, 2004, Guarantor executed and delivered to Bank a Continuing
Unconditional Guaranty (“Original
Guaranty”)
pertaining to the Bank’s loans and financial accommodations to ISI Detention
Contracting, Inc., a Delaware corporation (n/k/a ISI Security Group,
Inc.).
B.
ISI
Security Group, Inc., a Delaware corporation (“Borrower”)
and
Bank have entered into that certain Amended and Restated Loan and Security
Agreement of even date herewith (the “Loan
Agreement”),
pursuant to which the Bank has agreed to make a revolving loan and a term loan
in the original aggregate amount of SIXTEEN MILLION TWO HUNDRED AND FIFTY
THOUSAND AND NO/100 DOLLARS ($16,250,000.00) (the “Loans”).
All
capitalized terms used herein but not defined herein shall have the meanings
ascribed to them in the Loan Agreement.
B. The
Bank
is not willing to make the Loans, or otherwise extend credit, to Borrower unless
Guarantor unconditionally guarantees payment and performance to Bank of the
Obligations; and
C. Guarantor
is a subsidiary of Borrower, and Guarantor will directly benefit from the Bank
making the Loans to Borrower.
AGREEMENT
NOW,
THEREFORE, as an inducement to the Bank to make the Loans to Borrower, and
for
other good and valuable consideration, the receipt and legal sufficiency of
which are hereby acknowledged, Guarantor agrees with Bank, as
follows:
Section
1. Guaranty
of Obligations.
Guarantor
hereby absolutely, irrevocably and unconditionally guarantees to Bank the
payment and performance of the Obligations as and when the same shall be due
and
payable, whether by lapse of time, by acceleration of maturity or otherwise.
Guarantor hereby absolutely, irrevocably and unconditionally covenants and
agrees that it is liable, jointly and severally, for the Obligations as a
primary obligor, and that Guarantor shall fully perform each and every term
and
provision hereof. This
Guaranty is a guaranty of payment and not of collection only. Bank shall not
be
required to exhaust any right or remedy or take any action against Borrower
or
any other person or entity or any collateral. Guarantor agrees that, as between
Guarantor and Bank, the Obligations may be declared to be due and payable for
the purposes of this Guaranty notwithstanding any stay, injunction or other
prohibition which may prevent, delay or vitiate any declaration as regards
Borrower and that in the event of a declaration or attempted declaration, the
Obligations shall immediately become due and payable by Guarantor for the
purposes of this Guaranty.
Section
2. Guaranty
Absolute.
Guarantor guarantees that the Obligations shall be paid strictly in accordance
with the terms of the Loan Documents. The liability of Guarantor under this
Guaranty is absolute and unconditional irrespective of: (a) any change in the
time, manner or place of payment of, or in any other term of, all or any of
the
Obligations, or any other amendment or waiver of or any consent to departure
from any of the terms of any Loan Document,
including any increase or decrease in the rate of interest thereon; (b) any
release or amendment or waiver of, or consent to departure from, or failure
to
act by Bank with respect to, any other guaranty or support document, or any
exchange, release or non-perfection of, or failure to act by Bank with respect
to, any Collateral, for all or any of the Obligations; (c) any present or future
law, regulation or order of any jurisdiction (whether of right or in fact)
or of
any agency thereof purporting to reduce, amend, restructure or otherwise affect
any term of the Obligations or any Loan Document;
(d) any
change in the corporate existence, structure, or ownership of Borrower; (e)
without being limited by the foregoing, any lack of validity or enforceability
of any Loan Document;
and (f)
any other setoff, recoupment, defense or counterclaim whatsoever (in any case,
whether based on contract, tort or any other theory) with respect to the Loan
Documents or the transactions contemplated thereby which might constitute a
legal or equitable defense available to, or discharge of, Borrower or a
Guarantor.
Section
3. Guaranty
Irrevocable.
This
Guaranty is a continuing guaranty of the
payment of all
Obligations now or hereafter existing and shall remain in full force and effect
until payment in full of all Obligations and other amounts payable under this
Guaranty and until the Loan Documents are no longer in effect.
Section
4. Reinstatement.
This
Guaranty shall continue to be effective or be reinstated, as the case may be,
if
at any time any payment of any of the Obligations is rescinded or must otherwise
be returned by the Bank on the insolvency, bankruptcy or reorganization of
Borrower or otherwise, all as though the payment had not been made, whether
or
not Bank is in possession of the Guaranty.
Section
5. Subrogation.
Guarantor shall not exercise any rights which it may acquire by way of
subrogation, by any payment made under this Guaranty or otherwise, until all
the
Obligations have been paid in full and the Loan Documents are no longer in
effect. If any amount is paid to Guarantor on account of subrogation rights
under this Guaranty at any time when all the Obligations have not been paid
in
full, the amount shall be held in trust for the benefit of the Bank and shall
be
promptly paid to Bank to be credited and applied to the Obligations, whether
matured or unmatured or absolute or contingent, in accordance with the terms
of
the Loan Documents. If Guarantor makes payment to Bank of all or any part of
the
Obligations and all the Obligations are paid in full and the Loan Documents
are
no longer in effect, Bank shall, at Guarantor's request, execute and deliver
to
Guarantor appropriate documents, without recourse and without representation
or
warranty, necessary to evidence the transfer by subrogation to Guarantor of
the
interest in the Obligations resulting from the payment.
2
Section
6. Subordination.
Without
limiting Bank’s rights under any other agreement, any liabilities owed by
Borrower to Guarantor in connection with any extension of credit or financial
accommodation by Guarantor to or for the account of Borrower, including but
not
limited to interest accruing at the agreed contract rate after the commencement
of a bankruptcy or similar proceeding, are hereby subordinated to the
Obligations, and such liabilities of Borrower to Guarantor, if Bank so requests,
shall be collected, enforced and received by Guarantor as trustee for the Bank
and shall be paid over to Bank on account of the Obligations but without
reducing or affecting in any manner the liability of Guarantor under the other
provisions of this Guaranty.
Section
7. Representations
and Warranties.
Guarantor represents and warrants that: (a) this Guaranty (i) has been
authorized by all necessary action; (ii) does not violate any agreement,
instrument, law, regulation or order applicable to Guarantor; (iii) does not
require the consent or approval of any person or entity, including but not
limited to any governmental authority, or any filing or registration of any
kind; and (iv) is the legal, valid and binding obligation of Guarantor
enforceable against Guarantor in accordance with its terms, except to the extent
that enforcement may be limited by applicable bankruptcy, insolvency and other
similar laws affecting creditors' rights generally; and (b) in executing and
delivering this Guaranty, Guarantor has (i) without reliance on Bank or any
information received from Bank and based upon such documents and information
it
deems appropriate, made an independent investigation of the transactions
contemplated hereby and Borrower, Borrower’s business, assets, operations,
prospects and condition, financial or otherwise, and any circumstances which
may
bear upon such transactions, Borrower or the obligations and risks undertaken
herein with respect to the Obligations; (ii) adequate means to obtain from
Borrower on a continuing basis information concerning Borrower; (iii) full
and
complete access to the Loan Documents and any other documents executed in
connection with the Loan Documents; and (iv) not relied and will not rely upon
any representations or warranties of Bank not embodied herein or any acts
heretofore or hereafter taken by Bank (including but not limited to any review
by Bank of the affairs of Borrower).
Section
8. Financial
Reports and Covenants.
(a) Guarantor
shall keep adequate books and records of account in accordance with methods
acceptable to Bank, consistently applied and furnish to Bank the financial
statements described in the Loan Agreement.
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(b) Bank
and
its accountants shall have the right to examine the records, books, management
and other papers of Guarantor which reflect upon its financial condition, at
the
Collateral or at any office regularly maintained by Guarantor where the books
and records are located. Bank and its accountants shall have the right to make
copies and extracts from the foregoing records and other papers. In addition,
Bank and its accountants shall have the right to examine and audit the books
and
records of Guarantor pertaining to the income, expenses and operation of the
Collateral during reasonable business hours at any office of Guarantor where
the
books and records are located.
Section
9. Remedies
Generally.
The
remedies provided in this Guaranty are cumulative and not exclusive of any
remedies provided by law.
Section
10. Setoff.
If
a
Default shall have occurred and be continuing, Bank is hereby authorized at
any
time and from time to time, to the fullest extent permitted by law, and to
the
extent permitted under the Loan Agreement, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any
time
held and other obligations at any time owing by Borrower to or for the credit
or
the account of Guarantor against any of and all the Obligations held by Bank,
irrespective of whether or Bank shall have made any demand under this Guaranty
and although such Obligations may be unmatured. The rights of Bank under this
Section are in addition to other rights and remedies (including other rights
of
setoff) which Bank may have.
Section
11. Formalities.
Guarantor waives presentment, demand, notice of dishonor, protest, notice of
acceptance of this Guaranty or incurrence of any of the Obligations and any
other formality with respect to any of the Obligations or this
Guaranty.
Section
12. Amendments
and Waivers.
No
amendment or waiver of any provision of this Guaranty, nor consent to any
departure by Guarantor therefrom, shall be effective unless it is in writing
and
signed by Bank, and then the waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No failure
on
the part of Bank to exercise, and no delay in exercising, any right under this
Guaranty shall operate as a waiver or preclude any other or further exercise
thereof or the exercise of any other right.
Section
13. Expenses.
Guarantor shall reimburse Bank on demand for all costs, expenses and charges
(including without limitation fees and charges of external legal counsel for
Bank and costs allocated by its internal legal department) incurred by Bank
in
connection with the performance or enforcement of this Guaranty. The obligations
of Guarantor under this Section shall survive the termination of this
Guaranty.
Section
14. Assignment.
This
Guaranty shall be binding on, and shall inure to the benefit of Guarantor and
Bank and their respective successors and assigns; provided
that
Guarantor may not assign or transfer its rights or obligations under this
Guaranty. Without limiting the generality of the foregoing: (a) the obligations
of Guarantor under this Guaranty shall continue in full force and effect and
shall be binding on any successor partnership and on previous partners and
their
respective estates if Guarantor is a partnership, regardless of any change
in
the partnership as a result of death, retirement or otherwise; and (b) Bank
may
assign, sell participations in or otherwise transfer its rights under the Loan
Documents to any other person or entity in accordance with the terms of the
Loan
Agreement, and the other person or entity shall then become vested with all
the
rights granted to Bank, as applicable, in this Guaranty or
otherwise.
4
Section
15. Captions.
The
headings and captions in this Guaranty are for convenience only and shall not
affect the interpretation or construction of this Guaranty.
Section
16. Notices.
All
notices or other written communications hereunder shall be in writing and shall
be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:
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To
the Guarantor:
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ISI
Security Group, Inc.
▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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With
a copy to:
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▇▇▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇
Attention:
Hull ▇▇▇▇▇▇▇▇▇▇, Esq.
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To
the Lender:
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LaSalle
Bank National Association
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
Commercial Lending Division
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With
copy to:
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▇▇▇▇▇▇▇
& ▇▇▇▇▇▇ L.L.C.
▇▇▇
▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇ ▇. ▇▇▇▇▇▇,
Esq,
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Guarantor
and Bank may change its address or telecopy number for notices and other
communications hereunder by notice to the other party. All notices and other
communications given to Guarantor or Bank in accordance with the provisions
of
this Guaranty shall be deemed to have been given on the date of
receipt.
Section
17. Governing
Law; Jurisdiction; Consent to Service of Process.
(a) This
Guaranty shall be construed in accordance with and governed by the law of the
State of Illinois.
(b) Guarantor
hereby irrevocably and unconditionally submits, for itself and its property,
to
the nonexclusive jurisdiction of any United States Federal or Illinois State
court sitting in Chicago, Illinois, and any appellate court from any thereof,
in
any action or proceeding arising out of or relating to this Guaranty, or for
recognition or enforcement of any judgment, and Guarantor hereby irrevocably
and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such Illinois State or, to the extent
permitted by law, in such Federal court. Guarantor hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Guaranty shall affect any right that Bank
may
otherwise have to bring any action or proceeding relating to this Guaranty
against Guarantor or its properties in the courts of any
jurisdiction.
5
(c) Guarantor
hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter
have
to the laying of venue of any suit, action or proceeding arising out of or
relating to this Guaranty in any court referred to in subsection (b) above.
Guarantor hereby irrevocably waives, to the fullest extent permitted by law,
the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
(d) Guarantor
irrevocably consents to service of process in the manner provided for notices
in
Section 16 hereof. Nothing in this Guaranty will affect the right of Bank to
serve process in any other manner permitted by law.
Section
18. Invalid
Provisions.
If any
provision of this Guaranty is held to be illegal, invalid, or unenforceable
under present or future laws effective during the term of this Guaranty, such
provision shall be fully severable and this Guaranty shall be construed and
enforced as if such illegal, invalid or unenforceable provision had never
comprised a part of this Guaranty, and the remaining provisions of this Guaranty
shall remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance from this Guaranty,
unless such continued effectiveness of this Guaranty, as modified, would be
contrary to the basic understandings and intentions of the parties as expressed
herein.
Section
19. ENTIRETY.
THIS
GUARANTY AND THE OTHER LOAN DOCUMENTS EXECUTED BY GUARANTOR EMBODY THE FINAL,
ENTIRE AGREEMENT OF GUARANTOR AND BANK WITH RESPECT TO THE SUBJECT MATTER HEREOF
AND THEREOF AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE
SUBJECT MATTER HEREOF AND THEREOF. THIS GUARANTY AND THE OTHER LOAN DOCUMENTS
EXECUTED BY GUARANTOR ARE INTENDED BY GUARANTOR AND BANK AS A FINAL AND COMPLETE
EXPRESSION OF THE TERMS HEREOF AND THEREOF, AND NO COURSE OF DEALING AMONG
GUARANTOR AND BANK, NO COURSE OF PERFORMANCE, NO TRADE PRACTICES, AND NO
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS
OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL BE USED TO CONTRADICT, VARY,
SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY OR ANY OTHER LOAN DOCUMENT
EXECUTED BY GUARANTOR. THERE ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR AND
BANK.
Section
20. WAIVER
OF RIGHT TO TRIAL BY JURY.
GUARANTOR AND BANK EACH HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY). GUARANTOR AND BANK EACH (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND SUCH OTHER PARTY HAVE
BEEN INDUCED TO EXECUTE OR ACCEPT THIS GUARANTY BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 20.
6
Section
21. AMENDMENT.
This
Guaranty amends and restates the Original Guaranty in its entirety.
[SIGNATURE
PAGES FOLLOW]
7
IN
WITNESS WHEREOF,
Guarantor has caused this Guaranty to be duly executed and delivered by its
duly
authorized officer as of the date first above written.
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DETENTION
CONTRACTING GROUP, LTD.,
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a
Texas limited partnership
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By:
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ISI
DETENTION CONTRACTING GROUP, INC.,
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a
Texas corporation, its general partner
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
DETENTION CONTRACTING GROUP, INC.,
a
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Texas
corporation
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
DETENTION CONTRACTING GROUP, INC.,
a
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California
corporation
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
DETENTION CONTRACTING GROUP, INC.,
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a
New Mexico corporation
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
DETENTION SYSTEMS, INC.,
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a
Texas corporation
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
SYSTEMS, LTD.,
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a
Texas limited partnership
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By:
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ISI
DETENTION SYSTEMS, INC.,
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a
Texas corporation, its general partner
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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METROPLEX
CONTROL SYSTEMS, INC.,
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a
Texas corporation (f/k/a ISI Metroplex Controls, Inc.)
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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ISI
CONTROLS, LTD.,
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a
Texas limited partnership
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By:
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METROPLEX
CONTROL SYSTEMS, INC.,
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a
Texas corporation, its general partner
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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METROPLEX
COMMERCIAL FIRE AND
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SECURITY
ALARMS, INC.,
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a
Texas corporation
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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MCFSA,
LTD.,
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a
Texas limited partnership
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By:
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METROPLEX
COMMERCIAL FIRE AND
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SECURITY
ALARMS, INC.,
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a
Texas corporation, its general partner
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By:
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/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ |
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Name:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title:
CEO
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9