Exhibit 10.07
GUARANTEE
TO: LAURENTIAN BANK OF CANADA
IN CONSIDERATION of LAURENTIAN BANK OF CANADA (the "Bank") dealing with ▇▇▇▇▇▇▇
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ONTARIO INC. (the "Customer"), the undersigned and each of them, if more than
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one, hereby jointly and severally guarantee payment to the Bank of all debts and
liabilities, present or future, direct or indirect, absolute or contingent,
matured or not, at any time owing by the Customer to the Bank or remaining
unpaid by the Customer to the Bank, whether arising from dealings between the
Customer and the Bank or from any other dealings by which the Customer may
become in any manner whatever liable to the Bank either alone or jointly with
any other corporation, person or persons or otherwise including all costs and
disbursements incurred by the Bank with a view to recovering or attempting to
recover said debts and liabilities (such debts and liabilities being herein
called the "Guaranteed Liabilities") together with interest accruing from date
of demand for payment at the Prime Lending Rate plus 0.50% per annum; provided
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that the rate of interest hereinbefore mentioned shall be increased by an
additional one half percent (0.50%) per annum if the Borrower fails to support
at any time during the term of this Agreement any portion of the credit facility
provided by the Bank to the Borrower pursuant to an Offer of Finance dated
February 15, 2002 by way of a term deposit or cash equivalent in form acceptable
to the Bank, in its sole discretion; and further provided that that the rate of
interest shall be further increased by a further additional one half percent
(0.50%) per annum if the Borrower fails to maintain deposits with the Bank on or
before May 30, 2002 in the aggregate amount of $ Cdn 2,500,000.00The Prime
Lending Rate means the annual rate of interest which the Bank establishes and
quotes from time to time as the reference rate of interest to determine interest
rates it will charge at such time for variable rate commercial loans in Canadian
dollars to its customers in Canada and to which it may refer as its "prime rate"
or "prime lending rate"; upon any change in the Prime Lending Rate, the rate of
interest hereunder shall be adjusted automatically and without the necessity of
any notice to the undersigned.
AND THE UNDERSIGNED and each of them, if more than one, hereby, jointly and
severally agrees with the Bank as follows:
1. In this guarantee the word "Guarantor" shall mean the undersigned and, if
there is more than one guarantor, it shall mean each of them.
2. This guarantee shall be a continuing guarantee of all the Guaranteed
Liabilities and shall apply to and secure any ultimate balance due or remaining
unpaid to the Bank and this guarantee shall not be considered as wholly or
partially satisfied by the payment or liquidation at any time of any sum of
money for the time being due or remaining unpaid to the Bank.
3. The Bank shall not be bound to exhaust its recourse against the Customer
or others or any security or other guarantees before being entitled to payment
from the Guarantor of the Guaranteed Liabilities and it shall not be obliged to
deliver its security before its whole claim has been paid.
4. The Guarantor's liability to make payment under this guarantee shall
arise forthwith after demand for payment has been made in writing on the
undersigned or any one of them, if more than one, and such demand shall be
deemed to have been duly made when delivered to or served at the address of the
undersigned or such one of them last known to the Bank, on the third business
day following posting if sent by regular mail, postage prepaid, to such address,
or on the business day next following if sent by facsimile transmission.
5. In addition to the Bank's right to demand payment at any time, upon
default in payment of any sum owing by the Customer to the Bank at any time, the
Bank may treat all Guaranteed Liabilities as due and payable and may forthwith
collect from the Guarantor the total amount hereby guaranteed and may apply the
sum so collected upon the Guaranteed Liabilities or may place it to the credit
of a special account. A written statement of a Manager or Acting Manager of a
branch of the Bank at which an account of the Customer is kept or of a General
Manager of the Bank as to the amount remaining unpaid to the Bank at any time by
the Customer shall, if agreed to by the Customer, be conclusive evidence and
shall, in any event, be prima facie evidence against the Guarantor as to the
amount remaining unpaid to the Bank at such time by the Customer.
6. This guarantee shall be in addition to and not in substitution for any
other guarantees or other security which the Bank may now or hereafter hold in
respect of the Guaranteed Liabilities and the Bank shall be under no obligation
to marshal in favour of the Guarantor any other guarantees or other security or
any moneys or other assets which the Bank may be entitled to receive or may have
a claim upon and no loss of or in respect of or unenforceability of any other
guarantees or other security which the Bank may now or hereafter hold in respect
of the Guaranteed Liabilities, whether occasioned by the fault of the Bank or
otherwise, shall in any way limit or lessen the Guarantor's liability.
7. Without prejudice to or in any way limiting or lessening the Guarantor's
liability and without obtaining the consent of or giving notice to the
Guarantor, the Bank may discontinue, reduce, increase or otherwise vary the
credit of the Customer, may grant time, renewals, extensions, indulgences,
releases and discharges to and accept compositions from or otherwise deal with
the Customer and others, including the Guarantor and any other guarantor as the
Bank may see fit, and the Bank may apply all money received from the Customer or
others or from security or guarantees upon such parts of the Guaranteed
Liabilities as the Bank may see fit and change any such application in whole or
in part from time to time.
8. Until repayment in full of all the Guaranteed Liabilities, all dividends,
compositions, proceeds of security, security valued or payments received by the
Bank from the Customer or others or from estates in respect of the Guaranteed
Liabilities shall be regarded for all purposes as payments in gross without any
right on the part of the
Guarantor to claim the benefit thereof in reduction of the liability under this
guarantee, and the Guarantor shall not claim any set-off or counterclaim against
the Customer in respect of any liability of the Customer to the Guarantor, claim
or prove in the bankruptcy or insolvency of the Customer in competition with the
Bank or have any right to be subrogated to the Bank.
9. This guarantee shall not be discharged or otherwise affected by the death
or loss of capacity of the Customer, by any change in the name of the Customer,
or in the membership of the Customer, if a partnership, or in the objects,
capital structure or constitution of the Customer, if a corporation, or by the
sale of the Customer's business or any part thereof or by the Customer
amalgamating with a corporation, but shall, notwithstanding any such event,
continue to apply to all Guaranteed Liabilities whether theretofore or
thereafter incurred and in the case of a change in the membership of a Customer
which is a partnership or in the case of liabilities of the resulting
partnership or corporation, the term "Customer" shall include each such
resulting partnership and corporation.
10. The Guarantor represents and warrants to the Bank that it is fully aware
of the financial condition of the Customer and agrees to monitor changes in the
financial condition of the Customer. The Guarantor acknowledges that the Bank
has made no representations or warranties regarding the financial condition of
the Customer, that the Bank expressly disclaims any obligation to advise the
Guarantor of any changes in the financial condition of the Customer and hereby
releases the Bank from any liability arising therefrom.
11. All advances, renewals and credits made or granted by the Bank to or for
the Customer after the death, loss of capacity, bankruptcy or insolvency of the
Customer, but before the Bank has received notice thereof shall be deemed to
form part of the Guaranteed Liabilities and all advances, renewals and credits
obtained from the Bank by or on behalf of the Customer shall be deemed to form
part of the Guaranteed Liabilities notwithstanding any lack or limitation of
power, incapacity or disability of the Customer or of the directors, partners or
agents thereof, or that the Customer may not be a legal or suable entity, or any
irregularity, defect or informality in the obtaining of such advances, renewals
or credits, whether or not the Bank had knowledge thereof; and any such
advance, renewal or credit which may not be recoverable from the undersigned as
guarantor(s) shall be recoverable from the undersigned and each of them, if more
than one, jointly and severally as principal debtor(s) in respect thereof and
shall be paid to the Bank on demand.
12. All debts and liabilities, present and future, of the Customer to the
Guarantor are hereby assigned to the Bank and postponed to the Guaranteed
Liabilities and all money received by the Guarantor in respect thereof shall be
received in trust for the Bank and forthwith upon receipt shall be paid over to
the Bank, the whole without in any way lessening or limiting the liability of
the Guarantor under this guarantee; and this assignment and postponement is
independent of the guarantee and shall remain in full force an effect until
repayment in full to the Bank of all the Guaranteed Liabilities, notwithstanding
that the liability of the undersigned or any of them under this guarantee may
have been discharged or terminated.
13. The undersigned or any of them, if more than one, or his, its or their
executors or administrators, by giving thirty days' notice in writing to the
branch of the Bank at which the main account of the Customer is kept, may
terminate his, its or their liability under this guarantee in respect of
liabilities of the Customer incurred or arising after the expiration of such
thirty days even though not then matured; provided that notwithstanding receipt
of any such notice the Bank may fulfil any requirements of the Customer based on
agreements express or implied made prior to the expiration of such thirty days
and any resulting liabilities shall be deemed to form part of the Guaranteed
Liabilities and shall be covered by this guarantee; and provided further that
in the event of the termination of this guarantee as to one or more of the
undersigned, if more than one, it shall remain a continuing guarantee as to the
other or others of the undersigned.
14. This guarantee embodies all the agreements between the parties hereto
relative to the guarantee, assignment and postponement and none of the parties
shall be bound by any representation or promise made by any person relative
thereto which is not embodied herein and it is specifically agreed that the Bank
shall not be bound by any representations or promises made by the Customer to
the Guarantor. Possession of this instrument by the Bank shall be conclusive
evidence against the Guarantor that the instrument was not delivered in escrow
or pursuant to any agreement that it should not be effective until any condition
precedent or subsequent has been fulfilled.
15. This guarantee shall be binding upon every signatory hereof
notwithstanding the non-execution hereof or of a similar guarantee by any other
proposed signatory or signatories.
16. This guarantee shall not be discharged or affected by the death of the
undersigned or any of them, if more than one, and shall enure to the benefit of
and be binding upon the Bank, its successors and assigns, and the Guarantor, its
heirs, executors, administrators, successors and assigns.
17. This guarantee shall be governed in all respects by the laws of the
Province of Ontario and the laws of Canada applicable therein.
18. The undersigned is domiciled at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ and will not change such domicile without
providing the Bank with prior written notice setting forth its new domicile and
the effective date of the change.
19. The Guarantor acknowledges having read this guarantee before signing it
and declares that he/she/it understands the terms, conditions and undertakings
contained herein. The Guarantor acknowledges receipt of a fully executed copy
of this guarantee hereby waives any right to receive a copy of any financing
statement, financing change statement or verification statement file at anytime
in connection with this guarantee.
IN WITNESS WHEREOF the Guarantor has hereunto affixed its Corporate Seal
attested by the hands of its proper officers duly authorized in that behalf as
of the 22nd day of February, 2002.
UNIVERSE2U CANADA INC.
Name of Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
per:___/s/ ▇▇▇ ▇▇▇▇▇ ______________________
Name: ▇▇▇ ▇▇▇▇▇
Title: President
c/s
per:_____/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇___________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Chairman
We have authority to bind the Corporation
SCHEDULE "C"
PERMITTED ENCUMBRANCES
PERSONAL PROPERTY SECURITY ACT
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NONE EXCEPT EQUIPMENT LEASES LIMITED TO OPERATING LEASES FOR SPECIFIC EQUIPMENT
(INCLUDING CAR LEASES FROM FORD CREDIT CANADA)NONE EXCEPT EQUIPMENT LEASES
LIMITED TO OPERATING LEASES FOR SPECIFIC EQUIPMENT (INCLUDING CAR LEASES FROM
FORD CREDIT CANADA)
OTHER SECURED LIABILITIES
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SECURED PARTY REGISTRATION PARTICULARS AMOUNT
NONE
BANK INDEBTEDNESS
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NONE
SCHEDULE "D"
ADDITIONAL PROVISIONS
1. In the event that any Affiliate of the Company that is currently
inactive, as declared by the auditor of the Company, becomes active at any time
in the future, and if the Company advances any monies to such Affiliate, then
the Company hereby covenants and undertakes to cause such Affiliate to grant in
favour of the Bank a first ranked general security agreement over all the
property of such Affiliate before any advances are made to such Affiliate.
2. All existing Priority Claims, which term means the aggregate amount of
all claims (i) created or arising by operation of law without the consent of the
Company, or any of its Affiliates, under statute, regulation, common or other
law which rank prior to or pari passu with any security held by the Bank,
including without limitation income tax withheld from employees, unemployment
insurance premiums, Canada Pension Plan contributions, vacation pay, provincial
sales tax, federal excise and goods service taxes, Workers Safety and Insurance
Board contributions or (ii) of suppliers which rank pari passu with any security
held by the Bank, shall be paid in full on or before May 31, 2002 and the
Company and its Affiliates shall furnish the Bank with proof of such payment on
or before May 31, 2002.
For the purposes of this schedule and notwithstanding the definition in section
1.1 of this Agreement, ?Affiliate? shall mean only the following corporations:
CableTec Communications Inc., Multilink Network Services Inc. and Coastal
Network Services Inc.
SCHEDULE "E"
MISCELLANEOUS PARTICULARS
1.1 "AFFILIATE" includes the following corporations:
Universe2U Inc.; 1418276 Ontario Inc.; CableTec Communications Inc.; Multilink
Network Services Inc. and Coastal Network Services Inc.
1.2 "MANAGEMENT GROUP" includes the following persons:
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
1.3 "NORMAL BUSINESS" means the following activities:
Provider of telecommunications access solutions to communities,
communications carriers, building owners and corporate and government customers
in North America.
1.4 "OFFER OF FINANCE" for the time being means the letter of the Bank to
the Company dated the 15th day of February, 2002, as accepted by the Company;
1.5 "SHAREHOLDER OWNERSHIP" means the direct or indirect beneficial
ownership of shares of the Company as follows:
Owner Class of Shares Number of Shares
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1418276 Ontario Inc. Common 5,833,000
