EXHIBIT 4.2(b)
GUARANTY AND SECURITY AGREEMENT
THIS GUARANTY AND SECURITY AGREEMENT is dated as of November
2, 1998, from Metro-Tel Corp., a Delaware corporation (the "Guarantor"), in
favor of First Union National Bank, a national banking association (the
"Lender").
W I T N E S S E T H:
WHEREAS, Xxxxxxx-Atlantic Corp., a Florida corporation (the
"Borrower"), and Lender have entered into a Loan and Security Agreement dated as
of the date hereof (as at any time amended, modified or supplemented, the "Loan
Agreement").
WHEREAS, Borrower is a wholly-owned subsidiary of Guarantor
and Guarantor will derive direct and indirect economic benefits from the
financings to be made by Lender pursuant to the Loan Agreement.
WHEREAS, in connection with the making of the Loans under the
Loan Agreement and as a condition precedent thereto, Lender is requiring that
Guarantor shall have executed and delivered this Guaranty.
NOW, THEREFORE, in consideration of the premises and the
covenants, agreements, terms and conditions contained herein, the parties hereto
hereby agree as follows:
SECTION 1 DEFINITIONS.
1.1 Defined Terms. For purposes of this Guaranty, in addition to (i)
the terms defined in the Loan Agreement, which shall be used herein as defined
therein if not separately defined herein, and (ii) the terms defined elsewhere
in this Guaranty, the following terms shall have the meanings set forth below
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
"Guaranty" or "this Guaranty" shall include all amendments,
modifications and supplements hereto and restatements hereof and shall refer to
this Guaranty and Security Agreement as the same may be in effect at the time
such reference becomes operative.
1.2 Terms. All other terms contained in this Guaranty shall, when the
context so indicates, have the meanings provided for by the Code to the extent
the same are used or defined therein.
SECTION 2 THE GUARANTY
2.1 Guaranty of Indebtedness of Borrower. The Guarantor hereby
unconditionally guarantees to Lender, and its successors, endorsees, transferees
and assigns, the prompt payment (whether at stated maturity, by acceleration or
otherwise) and performance of the Indebtedness. Guarantor agrees that this
Guaranty is a guaranty of payment and performance and not of collection, and
that its obligations under this Guaranty shall be primary, absolute and
unconditional, irrespective of, and unaffected by:
(a) the genuineness, validity, regularity, enforceability or
any future amendment of, or change in this Guaranty, the Loan
Agreement, any other Loan Document or any other agreement, document or
instrument to which Borrower and/or Guarantor is or are or may become a
party;
(b) the absence of any action to enforce this Guaranty, the
Loan Agreement or any other Loan Document or the waiver or consent by
Lender with respect to any of the provisions thereof;
(c) the existence, value or condition of, or failure to
perfect its Lien against, any security for the Indebtedness or any
action, or the absence of any action, by Lender in respect thereof
(including, without limitation, the release of any such security); or
(d) any other action or circumstances which might otherwise
constitute a legal or equitable dis charge or defense of a surety or
guarantor;
it being agreed by Guarantor that its obligations under this Guaranty shall not
be discharged until the payment and performance and discharge in full, of the
Indebtedness. Guarantor shall be regarded, and shall be in the same posi tion,
as principal debtor with respect to the Indebtedness. Guarantor expressly waives
all rights it may have now or in the future under any statute, or at common law,
or at law or in equity, or otherwise, to compel Lender to proceed in respect of
the Indebtedness against Borrower or any other party or against any security for
the payment and perfor xxxxx of the Indebtedness before proceeding against, or
as a condition to proceeding against, Guarantor. Guarantor agrees that any
notice or directive given at any time to Lender which is inconsistent with the
waiver in the immediately preceding sentence shall be null and void and may be
ignored by Lender, and, in addition, may not be pleaded or introduced as
evidence in any litigation relating to this Guaranty for the reason that such
pleading or intro duction would be at variance with the written terms of this
Guaranty, unless Lender has specifically agreed otherwise in writing. It is
agreed between Guarantor and Lender that the foregoing waivers are of the
essence of the transaction contemplated by the Loan Documents and that, but for
this Guaranty and such waivers, Lender would decline to make the Loans under the
Loan Agreement.
2.2 Demand by Lender. In addition to the terms of the Guaranty set
forth in section 2.1 hereof, and in no manner imposing any limitation on such
terms, it is expressly understood and agreed that, if the then outstanding
principal amount of the Indebtedness (together with all accrued interest
thereon) is declared to be, or otherwise becomes, immediately due and payable,
then, Guarantor shall, upon demand in writing therefor by Lender to Guarantor,
pay to Lender in immediately available federal funds the entire outstanding
Indebtedness due and owing to holder or holders of the Indebtedness. Such
payment by Guarantor shall be credited and applied upon the Indebtedness to an
account designated by Lender or at the address set forth herein for the giving
of notice to Lender or at any other address that may be specified in writing
from time to time by Lender.
2.3 Enforcement of Guaranty. In no event shall Lender have any
obligation (although Lender is entitled, at its option) to proceed against
Borrower or any other Person or any real or personal property pledged to secure
the Indebtedness before seeking satisfaction from Guarantor, and Lender may
proceed, prior or subsequent to, or simul taneously with, the enforcement of
Lender's rights hereunder, to exercise any right or remedy which it may have
against any property as a result of any Lien it may have as security for all or
any portion of the Indebtedness.
2.4 Waiver. In addition to the waivers contained in section 2.1 hereof,
Guarantor waives, and agrees that it shall not at any time insist upon, plead or
in any manner whatever claim or take the benefit or advantage of, any appraisal,
valuation, stay, extension, marshalling of assets or redemption laws, or
exemption, whether now or at any time hereafter in force, which may delay,
prevent or otherwise affect the performance by Guarantor of its obligations
under, or the enforcement by Lender of, this Guaranty. Guarantor hereby waives
diligence, presentment and demand (whether for non-payment or protest or of
acceptance, maturity, extension of time, change in nature or form of the
Indebtedness, acceptance of further security, release of further security,
composition or agreement arrived at as to the amount of, or the terms of, the
Indebtedness, notice of adverse change in Borrower's financial condition or any
other fact which might materially increase the risk to Guarantor) with respect
to any of the Indebtedness or all other demands whatsoever and waives the
benefit of all provisions of law which are or might be in conflict with the
terms of this Guaranty. Guarantor represents, warrants and agrees that, as of
the date of this Guaranty, its obligations under this Guaranty are not subject
to any offsets or defenses against Lender or Borrower
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of any kind. Guarantor further agrees that its obligations under this Guaranty
shall not be subject to any counter claims, offsets or defenses against Lender
or Borrower of any kind which may arise in the future.
2.5 Benefit of Guaranty. The provisions of this Guaranty are for the
benefit of Lender and its succes sors, transferees, endorsees and assigns, and
nothing herein contained shall impair, as between Borrower, on the one hand, and
Lender, on the other hand, the obligations of Borrower under the Loan Agreement.
In the event all or any part of the Indebtedness is transferred, endorsed or
assigned by Lender to any Person or Persons, any reference to "Lender" herein
shall be deemed to refer equally to such Person or Persons.
2.6 Modification of Loans, Etc. If Lender shall at any time or from
time to time, with or without the consent of, or notice to, Guarantor:
(a) change or extend the manner, place or terms of payment of,
or renew or alter all or any portion of, the Indebtedness;
(b) take any action under or in respect of any of the Loan
Documents in the exercise of any remedy, power or privilege contained
therein or available to it at law, equity or otherwise, or waive or
refrain from exercising any such remedies, powers or privileges;
(c) amend, modify or restate in any manner whatsoever, any of
the Loan Documents;
(d) extend or waive the time for Guarantor's, Borrower's or
other Person's performance of, or compliance with, any term, covenant
or agreement on its part to be performed or observed under any of the
Loan Documents, or waive such performance or compliance or consent to a
failure of, or departure from, such performance or compliance;
(e) take and hold any additional security or collateral for
the payment of the Indebtedness guaranteed hereby or sell, exchange,
release, dispose of, or otherwise deal with, any property pledged,
mortgaged or conveyed, or in which Lender has been granted a Lien, to
secure any indebtedness of Guarantor or Borrower to Lender;
(f) release anyone who may be liable in any manner for the
payment of any amounts owed by Guarantor or Borrower to Lender;
(g) modify or terminate the terms of any intercreditor or
subordination agreement pursuant to which claims of other creditors of
Guarantor or Borrower are subordinated to the claims of Lender; and/or
(h) apply any sums by whomever paid or however realized to any
amounts owing by Guarantor or Borrower to Lender in such manner as
Lender shall determine in its sole discretion;
then Lender shall not incur any liability to Guarantor pursuant hereto as a
result thereof, and no such action shall impair or release the obligations of
Guarantor under this Guaranty.
2.7 Reinstatement. This Guaranty shall remain in full force and effect
and continue to be effective in the event that any petition is filed by or
against Borrower or Guarantor for liquidation or reorganization, in the event
that Borrower or Guarantor becomes insolvent or makes an assignment for the
benefit of creditors or in the event that a receiver or trustee is appointed for
all or any significant part of Borrower's, or Guarantor's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Indebtedness, or any part thereof, is, pursuant
to applicable law, rescinded or reduced in amount, or must otherwise be restored
or returned by Lender, whether as a "voidable preference", "fraudulent
conveyance", or otherwise, all as though such payment or performance had not
been made. In the event that any payment, or any part thereof, is
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rescinded, reduced, restored or returned, the Indebtedness shall be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
2.8 Waiver of Subrogation, Etc.
(a) If, pursuant to applicable law, Guarantor, by payment or
otherwise, becomes subrogated to all or any of the rights of Lender under any of
the Loan Documents, the rights of Lender to which Guarantor shall be subrogated
shall be accepted by Guarantor "as is" and without any representation or
warranty of any kind by Lender, express or implied, with respect to the
legality, value, validity or enforceability of any of such rights, or the
existence, availability, value, merchantability or fitness for any particular
purpose of any Collateral and shall be without recourse to Lender.
(b) If Lender, under applicable law, proceeds to realize its
benefits under any of the Loan Documents giving Lender a Lien upon any
Collateral, whether owned by Borrower, Guarantor or by any other Person, either
by judicial foreclosure or by non-judicial sale or enforcement, Lender may, at
its sole option, determine which of its remedies or rights it may pursue without
affecting any of its rights and remedies under this Guaranty. If, in the
exercise of any of its rights and remedies, Lender forfeits any of its rights or
remedies, including its right to enter a deficiency judgment against Borrower or
any other Person, whether because of any applicable laws pertaining to "election
of remedies" or the like, Guarantor hereby consents to such action by Lender and
waives any claim based upon such action, even if such action by Lender shall
result in a full or partial loss of any rights of subrogation which Guarantor
might otherwise have had but for such action by Lender. Any election of remedies
which results in the denial or impairment of the right of Lender to seek a
deficiency judgment against Borrower shall not impair Guarantor's obligation to
pay the full amount of the Indebtedness. In the event that Lender bids at any
foreclosure or trustee's sale or at any private sale permitted by law or any of
the Loan Documents, Lender may bid all or less than the amount of the
Indebtedness and the amount of such bid need not be paid by Lender but shall be
credited against the Indebtedness. The amount of the successful bid at any such
sale, whether Lender or any other party is the successful bidder, shall be
conclusively deemed to be the fair market value of the subject collateral and
the difference between such bid amount and the remaining balance of the
Indebtedness shall be conclusively deemed to be the amount of the Indebtedness
guaranteed under this Guaranty, notwithstanding that any present or future law
or court decision or ruling may have the effect of reducing the amount of any
deficiency claim to which Lender might otherwise be entitled but for such
bidding at any such sale.
2.9 Continuing Guaranty. Guarantor agrees that this Guaranty is a
continuing guaranty and shall remain in full force and effect until the payment
and performance in full of the Indebtedness; provided, however, that if any sums
paid to and applied by Lender toward the Indebtedness are thereafter required to
be repaid to Borrower or to any Affiliate, or to any trustee, receiver or other
person, by reason of the application of the Bankruptcy Code, the Uniform
Fraudulent Transfer Act or any other law relating to creditors' rights
generally, then this Guaranty shall be reinstated, ab initio, as if such portion
of the Indebtedness had never been paid.
SECTION 3 SECURITY FOR THE OBLIGATIONS.
3.1 Security Interest in the Metro-Tel Collateral. To secure the
payment and performance of any and all of the Indebtedness and the performance
of all obligations and covenants of Guarantor hereunder and under the other Loan
Documents, absolute or contingent, now existing or hereafter arising, which are
now, or may at any time or times hereafter be owing by Guarantor to Lender,
Guarantor hereby pledges to Lender and gives and grants Lender a continuing and
general security interest in and Lien upon and right of set-off against, all
right, title and interest of Guarantor in and to all of the Metro-Tel Collateral
whether now owned or hereafter acquired by Guarantor; provided, however, that
notwithstanding anything to the contrary set forth herein, none of Guarantor's
obligations hereunder shall be secured by real property.
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3.2 Disclosure of Security Interest. Guarantor shall make appropriate
entries upon its financial statements and its books and records disclosing
Lender's Liens and security interests in all of the Metro-Tel Collateral.
3.3 Supplemental Documentation. At Lender's request, Guarantor shall
cause the execution and delivery to Lender, in form and substance satisfactory
to Lender, of all such agreements, documents, financing statements and other
writings requested by Lender to perfect and maintain the perfection and priority
of its security interests in and Liens on the Metro-Tel Collateral and to
consummate the other transactions contemplated hereby, and Guarantor shall pay
all filing fees and documentary stamp, intangible and similar taxes in
connection therewith. Guarantor irrevocably designates Lender as its
attorney-in-fact to effectuate the foregoing.
3.4 Inspection. Guarantor hereby irrevocably consents to any reasonable
act by Lender or its agents in entering upon any premises during normal business
hours for the purposes of either (i) inspecting the Collateral and making
extracts from and copies of any books and records relating thereto or (ii)
taking possession of the Collateral at any time following the occurrence of an
Event of Default; and Guarantor hereby waives its right to assert against Lender
or its agents any claim based upon trespass or any similar cause of action for
entering upon any premises where the Collateral may be located. Guarantor
irrevocably consents to Lender's requesting information pertaining to Guarantor
from any Person and to Lender's verifying such or any other information
pertaining to Guarantor, including, but not limited to the amount, quality,
existence, quantity, value and condition of any Account of Metro- Tel or any
other Collateral.
3.5 Cross-Collateralization. All collateral which Lender may at any
time acquire from any other source as security for the payment of any
Indebtedness shall constitute cross-collateral for all Indebtedness without
apportionment or designation as to particular Indebtedness, and all Indebtedness
shall be secured by all such collateral; and Lender shall have the right, in its
sole discretion, to determine the order in which its rights in or remedies
against such collateral are to be exercised and which types or portions of the
collateral are to be proceeded against and the order of application of proceeds
of collateral against particular Indebtedness.
3.6 Collections; Lender's Right to Notify Account Debtors and to
Endorse Guarantor's Name. Guarantor hereby authorizes Lender (a) upon the
occurrence and during the continuation of a Default or an Event of Default, to
open Guarantor's mail and collect any and all amounts due to Guarantor from
Account Debtors; (b) after the occurrence of a Default or an Event of Default,
notify any or all Account Debtors that the Accounts have been assigned to Lender
and that Lender has a security interest therein; and (c) after the occurrence of
a Default or an Event of Default, direct such Account Debtors to make all
payments due from them to Guarantor upon the Accounts directly to Lender or to a
lock box designated by Lender. Lender shall promptly furnish Guarantor with a
copy of any such notice sent and Guarantor hereby agrees that any such notice
may be sent on Guarantor's stationery, in which event Guarantor shall co-sign
such notice with Lender. Guarantor irrevocably makes, constitutes and appoints
Lender (and all Persons designated by Lender for that purpose) as Guarantor's
true and lawful attorney (and agent-in-fact) to endorse Guarantor's name on any
checks, notes, drafts or any other payment relating to and/or proceeds of the
Collateral which come into either Lender's possession or control.
3.7 Preservation of Rights in Collateral. Except as herein or by
applicable law otherwise expressly provided, Lender shall not be obligated to
exercise any degree of care in connection with any Collateral, to take any steps
necessary to preserve any rights in any of the Collateral or to preserve any
rights therein against prior parties. No segregation or specific allocation by
Lender of specified items of Collateral against any liability of Guarantor shall
waive or affect any Lien against other items of Collateral or any of Lender's
options, powers or rights under this Guaranty or otherwise arising.
3.8 Other Rights. Guarantor authorizes Lender without affecting either
Guarantor's or Lender's obligations hereunder or under any other Loan Document
from time to time to take from any party and hold additional collateral or
guaranties for the payment of the Indebtedness or any part thereof, and to
exchange, enforce,
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substitute or release such collateral or guaranty of payment of the Indebtedness
or any part thereof and to release or substitute any endorser or guarantor or
any party who has given any Lien on any collateral as security for the payment
of the Indebtedness or any part thereof or any party in any way obligated to pay
the Indebtedness or any part thereof.
3.9 Tangible Collateral; Inventory. No Inventory, Equipment or other
tangible collateral shall be commingled with, or become an accession to or part
of, any property of any other Person so long as such property is Collateral. No
tangible Collateral is or shall be allowed to become a fixture. No tangible
Collateral shall be stored with any warehouseman, bailee or similar party.
3.10 Lender's Payment of Claims Asserted Against the Collateral. In the
event a Lien, other than a Permitted Lien, is asserted by any Person against the
Collateral and if Lender has given Guarantor five days' prior written notice and
Guarantor has failed to either (i) satisfy the Lien or (ii) cause the Lien to be
transferred to a bond acceptable to Lender, then Lender may at any time after
such five-day period in its discretion without waiving or releasing any
obligation, liability or duty of Guarantor under this Guaranty, the other Loan
Documents or any Default or Event of Default, pay, acquire and/or accept an
assignment of such Lien. All sums paid by Lender in respect thereof and all
reasonable costs, fees and expenses, including, without limitation, reasonable
attorneys' fees, court costs, expenses and other charges relating thereto, which
are incurred by Lender on account thereof, shall be payable, upon demand, by
Guarantor to Lender and shall be additional Indebtedness hereunder secured by
the Collateral.
SECTION 4 COVENANTS OF GUARANTOR.
Guarantor covenants and agrees that from the date hereof and until
payment in full of the Indebtedness unless Lender shall otherwise consent in
writing, Guarantor:
4.1 Compliance with Loan Documents. Shall, and shall cause Borrower to,
comply with all terms, conditions, covenants and agreements set forth in the
Loan Documents.
4.2 Insurance. Shall, and shall cause Borrower to, maintain and pay for
insurance upon all Collateral, wherever located, and otherwise covering
casualty, hazard, workers' compensation, business interruption, public liability
and such other risks (as is customary in the businesses in which Borrower and
Guarantor are engaged) and in such amounts and with such insurance companies as
shall be reasonably satisfactory to Lender and in compliance with law. Borrower
and Metro-Tel shall deliver such certificates of insurance to Lender with loss
payable endorsements naming Lender as loss payee thereunder in form reasonably
satisfactory to Lender. Guarantor also agrees to, and to cause Borrower to,
maintain and pay for insurance in such amount, with such companies and in such
form as shall be reasonably satisfactory to Lender insuring Borrower and
Guarantor against any claims, suits, loss or damages suffered by any Person on
any property owned or leased by Borrower and Guarantor and against such other
casualties and contingencies as is customary in the business in which Borrower
or Guarantor is engaged, and deliver such certificates of insurance to Lender
with satisfactory endorsements naming Lender as additional insured thereunder.
Each policy of insurance shall contain a clause requiring the insurer to give
not less than thirty (30) days' prior written notice to Lender before any
cancellation of the policies for any reason whatsoever and a clause that the
interest of Lender shall not be impaired or invalidated by any act or neglect of
Borrower or Guarantor or the owner of the property nor by the occupation of the
premises wherein such property is located for purposes more hazardous than are
permitted by said policy. Guarantor hereby directs all insurers under such
policies of insurance on the Collateral to pay all proceeds payable thereunder
directly to Lender following an Event of Default. Guarantor hereby irrevocably
makes, constitutes and appoints Lender (and all officers, employees or agents
designated by Lender) as Guarantor's true and lawful attorney (and
agent-in-fact) for the purpose of making, settling and adjusting claims under
such policies of insurance, endorsing the name of Guarantor on any check, draft,
instrument or other item of payment for the proceeds of such policies of
insurance and for making all determinations and decisions with respect to such
policies of insurance; provided, however, that such power shall not be used
until after the occurrence of and during
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the continuation of an Event of Default. Prior to the occurrence of an Event of
Default, neither Borrower nor Guarantor will make, settle or adjust any material
claim without the prior written consent of Lender, which consent will not be
unreasonably withheld. If Guarantor fails to obtain and maintain any of the
policies of insurance or to pay any premium in whole or in part, then Lender
may, at Guarantor's expense, without waiving or releasing any obligation or
default, procure the same, but shall not be required to do so. All sums so
disbursed by Lender, including attorneys' fees, court costs, expenses and other
charges related thereto, shall be payable on demand by Guarantor to Lender and
shall be additional Indebtedness hereunder secured by the Collateral.
4.3 Liens. Shall not create or permit to exist any Liens on any of the
Metro-Tel Collateral or its other assets, except Permitted Liens.
SECTION 5 EVENTS OF DEFAULT.
The occurrence of any one or more of the following events shall
constitute an "Event of Default":
(a) Guarantor fails to pay any portion of the Indebtedness
when due and payable or declared due and payable, or fails to remit or deposit
items or funds as required by the terms of this Guaranty; or
(b) Guarantor fails or neglects to observe, perform or comply
with any other term, provision, condition, covenant, warranty or representation
contained in this Guaranty, or the other Loan Documents or in any other
agreement now existing or hereafter executed evidencing, securing or relating in
any way to the Indebtedness or the obligations of Guarantor hereunder, which is
required to be observed, performed or complied with by Guarantor, in any such
instance after the passage of any applicable grace period; or
(c) A Default or an Event of Default (as such term is defined
in the Loan Agreement) shall occur.
SECTION 6 RIGHTS AND REMEDIES AFTER EVENT OF DEFAULT.
6.1 Rights and Remedies. Upon and after the occurrence of any Event of
Default, Lender shall have, in addition to all other rights and remedies which
Lender may have under this Guaranty, the other Loan Documents, and applicable
law, the following rights and remedies, all of which may be exercised with or
without further notice to Guarantor: (a) all of the rights and remedies of a
secured party under the Code and applicable law; (b) to foreclose the Liens
created under this Guaranty and the other Loan Documents or under any other
agreement relating to the Collateral, by any available judicial procedure or
without judicial process; (c) to enter any premises where the Collateral may be
located, through self-help and without judicial process, without first obtaining
a final judgment or giving Guarantor notice and opportunity for a hearing on the
validity of Lender's claim, for the purpose of taking possession or removing the
same, or require Guarantor to assemble the Collateral and make it available to
Lender at a place to be designated by Lender; and/or (d) to sell, assign, lease,
or otherwise dispose of the Collateral or any part thereof, either at public or
private sale, in lots or in bulk, for cash, on credit or otherwise, with or
without representation or warranties, and upon such terms as shall be acceptable
to Lender, in its sole discretion, and Lender may bid or become the purchaser at
any such public sale, free from any right of redemption which is hereby
expressly waived by Guarantor, and Lender shall have the option to apply or be
credited with the amount of all or any part of the Indebtedness owing to Lender
against the purchase price bid by Lender at any such sale. Lender may, if it
deems it reasonable, postpone or adjourn any sale of the Collateral from time to
time by an announcement at the time and place of such postponed or adjourned
sale, without being required to give a new notice of sale. Guarantor agrees that
Lender has no obligation to preserve rights to the Collateral against prior
Persons or to xxxxxxxx any Collateral for the benefit of any Person. Lender is
hereby granted a license or other right to use, without charge, Guarantor's
labels, patents, copyrights, rights of use of any name, trade secrets, trade
names, trademarks, and
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advertising matter, or any property of a similar nature, as it pertains to the
Collateral, in completing production of, advertising for sale, and selling any
Collateral and Guarantor's rights under all licenses and franchise agreements
shall inure to Lender's benefit. In addition, Guarantor agrees that in the event
notice is necessary under applicable law, written notice mailed to Guarantor in
the manner specified herein five (5) days prior to the date of public sale of
any of the Collateral or prior to the date after which any private sale or other
disposition of the Collateral will be made shall constitute commercially
reasonable notice to Guarantor. Upon the occurrence of an Event of Default,
Lender shall also have the right to seek the appointment of a receiver to take
possession of and operate and dispose of Guarantor's assets. Lender may, at any
time during the continuance of an Event of Default, and at Guarantor's expense,
employ and maintain custodians at Guarantor's premises who shall have full
authority to protect Lender's interests. Upon the occurrence and during the
continuation of an Event of Default, Guarantor authorizes Lender to collect and
set-off and apply against the Indebtedness when due any cash or deposit accounts
in its possession, and any refund of insurance premiums or any insurance
proceeds payable on account of the loss or damage to any of the Collateral and
irrevocably appoints Lender as its attorney-in-fact to endorse any check or
draft or take other action necessary to obtain such funds. All or any part of
the Collateral may be liquidated and sold by Lender for failure of Guarantor to
pay any of the Indebtedness, regardless of whether any of the Loans have been
accelerated or whether the Interest Rate Swap Agreement has been terminated
early. Notwithstanding anything to the contrary set forth herein, Collateral may
be liquidated upon Borrower's failure to pay any Indebtedness on a timely basis,
whether or not any acceleration has occurred or the Interest Rate Swap Agreement
has been terminated early.
6.2 Application of Proceeds. After an Event of Default, the net cash
proceeds resulting from the collection, liquidation, sale, lease or other
disposition of the Collateral shall be applied first to the expenses (including
all reasonable attorneys' fees) of retaking, holding, storing, processing and
preparing for sale, selling, collecting, liquidating and the like, and then to
the satisfaction of all Indebtedness, application as to particular Indebtedness
or against principal or interest to be in Lender's absolute discretion. With
limiting the generality of any other provision herein, Guarantor shall be liable
to Lender and shall pay to Lender on demand any deficiency which may remain
after such sale, disposition, collection or liquidation of the Collateral. With
limiting the generality of any other provision herein, Lender shall forthwith
remit to Guarantor or the Person entitled thereto any surplus remaining after
all Indebtedness has been paid in full. If any of the Collateral shall require
repairs, maintenance, preparation or the like, or is in process or other
unfinished state, Lender shall have the right, but shall not be obligated, to
perform such repairs, maintenance, preparation, completion of manufacturing or
processing, for the purpose of putting the same in such saleable form as Lender
shall deem appropriate, but Lender shall have the right to sell or dispose of
the Collateral without any such repairs, maintenance, preparation, completion of
manufacturing or processing. Guarantor will, at Lender's request, assemble (as
soon as reasonably practicable) all the Collateral and make it available to
Lender at places which Lender may select, whether at premises of Guarantor or
elsewhere, and will make available to Lender all premises and facilities of
Guarantor for the purpose of Lender's taking possession of the Collateral or of
removing or putting the Collateral in saleable form.
6.3 Appointment of Lender as Guarantor's Lawful Attorney. Guarantor
hereby irrevocably designates, makes, constitutes and appoints Lender (and all
Persons designated by Lender) as Guarantor's true and lawful attorney (and
agent-in-fact) and Lender, or Lender's agent, may, upon and after the occurrence
of an Event of Default, without notice to Guarantor, and at such time or times
thereafter as Lender or said agent, in its sole discretion, may determine, in
Guarantor's or Lender's name: (i) demand payment of the Accounts; (ii) enforce
payment of the Accounts, by legal proceedings or otherwise; (iii) exercise all
of Guarantor's rights and remedies with respect to the collection of the
Accounts; (iv) settle, adjust, compromise, extend or renew the Accounts; (v)
settle, adjust or compromise any legal proceedings brought to collect the
Accounts; (vi) if permitted by applicable law, sell or assign the Accounts upon
such terms, for such amounts and at such time or times as Lender deems
advisable; (vii) discharge and release the Accounts; (viii) prepare, file and
sign Guarantor's name on a proof of claim in bankruptcy or similar document
against any Account Debtor; (ix) prepare, file and sign Guarantor's name on any
notice of Lien, assignment or satisfaction of Lien or similar document in
connection with the Accounts; (x) do all acts and things necessary, in Lender's
sole discretion, to fulfill Guarantor's obligations under this Guaranty; (xi)
endorse the name of Guarantor upon any chattel paper, document, instrument,
invoice, freight xxxx, xxxx of lading or similar document
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or agreement relating to the Accounts or Inventory; (xii) use Guarantor's
stationery and sign the name of Guarantor to verifications of the Accounts and
notices thereof to Account Debtors; (xiii) use the information recorded, other
than classified information, on or contained in any data processing equipment
and computer hardware and software relating to the Accounts and Inventory to
which Guarantor has access; (xiv) take control, in any manner, of any item of
payment or proceeds referred to in section 3.6 hereof; (xv) endorse the name of
Guarantor upon any item of payment or proceeds referred to in section 3.6 hereof
and deposit the same to the account of Lender on account of the Indebtedness;
and (xvi) endorse Guarantor's name upon any chattel paper, document, instrument,
invoice, freight xxxx, xxxx of lading or similar document or agreement relating
to the Accounts or Inventory. All acts of Lender or its designee, except
Lender's and its designees' acts of gross negligence or willful misconduct,
taken pursuant to this section 6.3 are hereby ratified and confirmed and Lender
or its designee shall not be liable for any acts of omission or commission nor
for any error of judgment or mistake of fact or law. This power, being coupled
with an interest, is irrevocable by Guarantor until all Indebtedness is paid in
full.
6.4 Rights and Remedies Cumulative; Non-Waiver; Etc. The enumeration of
Lender's rights and remedies set forth in this Guaranty is not intended to be
exhaustive and the exercise by Lender of any right or remedy shall not preclude
the exercise of any other rights or remedies, all of which shall be cumulative,
and shall be in addition to any other right or remedy given hereunder, under the
Loan Documents or under any other agreement between Guarantor and Lender or
which may now or hereafter exist in law or in equity or by suit or otherwise. No
delay or failure to take action on the part of Lender in exercising any right,
power or privilege shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or privilege preclude other or further
exercise thereof or the exercise of any other right, power or privilege or shall
be construed to be a waiver of any Event of Default. No course of dealing
between Guarantor and Lender or Lender's employees shall be effective to change,
modify or discharge any provision of this Guaranty or to constitute a waiver of
any Event of Default. Lender shall not, under any circumstances or in any event
whatsoever, have any liability for any error, omission or delay of any kind
occurring in the liquidation of the Collateral or for any damages resulting
therefrom except damages directly attributable to Lender's gross negligence or
willful misconduct.
SECTION 7 PAYMENT OF EXPENSES
Provided same shall not have previously been paid by Borrower,
Guarantor shall pay or reimburse Lender upon demand for all reasonable expenses
(including, without limitation, reasonable attorneys' and paralegals' expenses)
incurred or paid by Lender in connection with: (a) any litigation, contest,
dispute, suit, proceeding or action (whether instituted by Lender or Guarantor
or any other Person) in any way relating to the Collateral, this Guaranty or the
other Loan Documents, or Borrower's or Guarantor's business or affairs; (b) any
attempt to enforce any rights of Lender or any participant against Guarantor or
any other Person which may be obligated to Lender by virtue of this Guaranty or
the other Loan Documents, including without limitation, the Account Debtors; (c)
any attempt to inspect, verify, protect, collect, sell, liquidate or otherwise
dispose of the Collateral; (d) the filing and recording of all documents
required by Lender to perfect Lender's Liens in the Collateral, including
without limitation, any documentary stamp tax or any other taxes incurred
because of such filing or recording.
SECTION 8 MISCELLANEOUS.
8.1 Survival of Agreements. All agreements, covenants, representations
and warranties contained herein or made in writing by or on behalf of Guarantor
in connection with the transactions contemplated hereby shall survive the
execution and delivery of this Guaranty and the other Loan Documents and shall
continue in full force and effect so long as any Indebtedness is outstanding. No
termination or cancellation (regardless of cause or procedure) of this Guaranty
shall in any way affect or impair the powers, obligations, duties, rights and
liabilities of the parties hereto in any way with respect to (a) any transaction
or event occurring prior to such termination or cancellation, (b) the
Collateral, or (c) any of Guarantor's undertakings, agreements, covenants,
warranties and representations contained
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in this Guaranty and the other Loan Documents and all such undertakings,
agreements, covenants, warranties and representations shall survive such
termination or cancellation. Guarantor further agrees that to the extent that
Guarantor makes a payment or payments to Lender, which payment or payments or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy, insolvency or similar state or federal
law, common law or equitable cause, then, to the extent of such payment or
repayment, the Indebtedness or part thereof intended to be satisfied shall be
revived and continued in full force and effect as if such payment had not been
received by Lender.
8.2 Notices. Any notice or other communication hereunder to any party
hereto shall be by hand delivery, facsimile transmission, nationally recognized
overnight courier for next business day delivery or registered or certified mail
and unless otherwise provided herein shall be deemed to have been received when
delivered personally or three days after deposit in such mail or with such
courier postage prepaid, addressed to the party at its address specified below
(or at any other address that the party may hereafter specify to the other
parties in writing):
Guarantor: Metro-Tel Corp.
000 X.X. 00xx Xxxxxx
Xxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
With a copy to: Xxxxxx Xxxxxxx, Esq.
Xxxxxxxxx Traurig
0000 Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Lender: First Union National Bank
Portfolio Management Group
0000 X.X. 00xx Xxxxxx, 0xx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
With a copy to: Xxxxxxx Xxxxxx Xxxxxx Xxxxxxxx
Xxxxxxxx & Xxxxxxxxx, P.A.
000 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
8.3 Indemnification of Lender. From and at all times after the date of
this Guaranty, and in addition to all of Lender's other rights and remedies
against Guarantor, Guarantor agrees to hold Lender harmless from, and to
indemnify Lender against, all losses, damages, costs and expenses (including,
but not limited to, reasonable attorneys' and paralegals' fees, costs and
expenses) incurred by Lender from and after the date hereof, whether direct,
indirect or consequential, as a result of or arising from or relating to any
suit, action or proceeding by any Person, whether threatened or initiated,
asserting a claim for any legal or equitable remedy against any Person under any
statute or regulation, including, but not limited to, any federal or state
securities laws, or under any common law or equitable cause or otherwise,
arising from or in connection with the negotiation, preparation, execution or
performance of, this Guaranty and the other Loan Documents; provided, however,
that the foregoing indemnification shall not protect a Lender from loss, damage,
cost or expense directly attributable to such Lender's willful misconduct or
gross negligence. All of the foregoing losses, damages, costs and expenses of
Lender shall be payable by Guarantor upon demand by Lender, as the case may be,
and shall be additional Indebtedness hereunder secured by the Collateral.
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8.4 Assignment. This Guaranty shall be binding upon and shall inure to
the benefit of Guarantor and Lender, and their respective successors and
assigns; provided that Guarantor may not assign any of its rights or duties
hereunder without the prior written consent of Lender and any such assignment
made without such consent shall be void. Nothing in this Guaranty shall prohibit
or restrict Lender from pledging or assigning the Loan Documents, including the
Collateral, to any Federal Reserve Bank in accordance with applicable law.
8.5 Amendment. This Guaranty cannot be amended, changed, discharged or
terminated orally, but only by an instrument in writing signed by Lender and
Guarantor.
8.6 Severability. To the extent any provision of this Guaranty is
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Guaranty.
8.7 Entire Agreement. This Guaranty and the other documents,
certificates and instruments referred to herein constitute the entire agreement
between the parties and supersede and rescind any prior agreements relating to
the subject matter hereof; provided, however, that, notwithstanding the
foregoing, this Guaranty shall not be deemed to modify, supersede, rescind,
revoke or otherwise diminish the terms or conditions of any other guaranty or
similar arrangement executed by Guarantor in favor of Lender.
8.8 Binding Effect. All of the terms of this Guaranty and the other
Loan Documents, as the same may from time to time be amended, shall be binding
upon, inure to the benefit of and be enforceable by the respective successors
and assigns of Guarantor and Lender. This provision, however, shall not be
deemed to modify section 8.5.
8.9 Captions. The captions to the various sections and subsections of
this Guaranty have been inserted for convenience only and shall not limit or
affect any of the terms hereof.
8.10 Conflict of Terms. The provisions of the other Loan Documents and
any Schedule thereto are incorporated in this Guaranty by this reference
thereto. Except as otherwise provided in this Guaranty and except as otherwise
provided in the other Loan Documents, if any provision contained in this
Guaranty is in conflict with, or inconsistent with, any provision of the other
Loan Documents, the provision contained in this Guaranty shall control.
8.11 Injunctive Relief. Guarantor recognizes that in the event
Guarantor fails to perform, observe or discharge any of its obligations or
liabilities under this Guaranty, any remedy of law may prove to be inadequate
relief to Lender. Guarantor therefore agrees that Lender, if Lender so requests,
shall be entitled to temporary and permanent injunctive relief in any such case
without the necessity of proving actual damages.
8.12 Further Assurances. At any time, and from time to time, upon the
written request of Lender, and at the sole expense of Guarantor, Guarantor will
promptly and duly execute and deliver any and all such further instruments and
documents and take such further actions as Lender may reasonably deem desirable
to obtain the full benefits of this Guaranty. Guarantor also hereby authorizes
Lender to file any additional financing or continuation statements without the
signature of Guarantor to the extent permitted by law.
8.13 Separate Legal Counsel. Guarantor has been represented by its own
legal counsel (and not that of Lender) in connection with the negotiation and
documentation of the Loan Documents.
8.14 Counterparts; Construction; Gender. This Guaranty may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original and all of which when taken together shall constitute but one and the
same instrument. Any telecopied version of a signature shall be deemed a
manually executed and delivered original. This Guaranty shall
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be construed without any presumption that it be construed against the party
causing it to be drafted. All references in this Guaranty or any of the other
Loan Documents to the masculine, feminine or neuter gender shall include all
such genders unless the context clearly indicates otherwise. Each
representation, warranty, covenant and agreement set forth in any Loan Document
shall be construed independently. The parties acknowledge that a Default or an
Event of Default shall be deemed continuing until cured, as determined by
Lender, in accordance with the terms hereof and the other Loan Documents.
8.15 Powers. All powers of attorney granted to Lender are coupled with
an interest and are irrevocable, until all Indebtedness is irrevocably paid in
full and Lender has no further obligations to make any Loans.
8.16 Approvals. If this Guaranty calls for the approval or consent of
Lender, such approval or consent may be given or withheld in the sole credit
judgment of Lender.
8.17 Arbitration; Preservation and Limitation of Remedies. Upon demand
of any party hereto, whether made before or after institution of any judicial
proceeding, any dispute, claim or controversy arising out of, connected with or
relating to this Guaranty or any other Loan Documents ("Disputes"), this
Guaranty shall be resolved by binding arbitration as provided herein.
Institution of a judicial proceeding by a party does not waive the right of that
party to demand arbitration hereunder. Disputes may include, without limitation,
tort claims, counterclaims, disputes as to whether a matter is subject to
arbitration, claims brought as class actions, claims arising from Loan Documents
executed in the future, or claims arising out of or connected with the
transaction reflected by this Guaranty. Arbitration shall be conducted under and
governed by the Commercial Financial Disputes Arbitration Rules (the
"Arbitration Rules") of the American Arbitration Association (the "AAA") and
Title 9 of the U.S. Code. All arbitration hearings shall be conducted in the
city in which the office of Lender first stated above is located. The expedited
procedures set forth in Rules 51 et seq. of the Arbitration Rules shall be
applicable to claims of less than $1,000,000. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be entered
in any court having jurisdiction. The panel from which all arbitrators are
selected shall be comprised of licensed attorneys. The single arbitrator
selected for expedited procedure shall be a retired judge from the highest court
of general jurisdiction, state or federal, of the state where the hearing will
be conducted or if such person is not available to serve, the single arbitrator
may be a licensed attorney. Notwithstanding the foregoing, this arbitration
provision does not apply to disputes under or related to any Interest Rate Swap
Agreement. Notwithstanding the preceding binding arbitration provisions, the
parties agree to preserve, without diminution, certain remedies that any party
hereto may employ or exercise freely, independently or in connection with an
arbitration proceeding or after an arbitration action is brought. The parties
shall have the right to proceed in any court of proper jurisdiction or by
self-help to exercise or prosecute the following remedies, as applicable: (i)
all rights to foreclose against any real or personal property or other security
by exercising a power of sale granted under Loan Documents or under applicable
law or by judicial foreclosure and sale, including a proceeding to confirm the
sale; (ii) all rights of self-help including peaceful occupation of real
property and collection of rents, set-off, and peaceful possession of personal
property; (iii) obtaining provisional or ancillary remedies including injunctive
relief, sequestration, garnishment, attachment, appointment of receiver and
filing an involuntary bankruptcy proceeding; and (iv) when applicable, a
judgment by confession of judgment. Preservation of these remedies does not
limit the power of an arbitrator to grant similar remedies that may be requested
by a party in a Dispute. The parties agree that they shall not have a remedy of
punitive or exemplary damages against the other in any Dispute and hereby waive
any right or claim to punitive or exemplary damages they have now or which may
arise in the future in connection with any Dispute whether the Dispute is
resolved by arbitration or judicially.
8.18 Governing Law; Jurisdiction and Venue; Waiver of Jury Trial.
SUBJECT TO THE TERMS OF SECTION 8.17, THIS GUARANTY SHALL BE INTERPRETED, AND
THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED, IN ACCORDANCE WITH
THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS) OF THE STATE OF
FLORIDA. SUBJECT TO THE TERMS OF SECTION 8.17, AS PART OF THE CONSIDERATION FOR
NEW VALUE THIS DAY RECEIVED, GUARANTOR HEREBY CONSENTS TO THE JURISDICTION OF
ANY STATE
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OR FEDERAL COURT LOCATED WITHIN DADE COUNTY, STATE OF FLORIDA, AND CONSENTS THAT
ALL SERVICE OF PROCESS BE MADE BY REGISTERED OR CERTIFIED MAIL DIRECTED TO
GUARANTOR AT THE ADDRESS STATED IN SECTION 8.2 AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL RECEIPT THEREOF OR THREE DAYS
AFTER DEPOSIT IN THE UNITED STATES MAILS, PROPER POSTAGE PREPAID. SUBJECT TO THE
TERMS OF SECTION 8.17, EACH OF GUARANTOR AND Lender HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY SUIT OR PROCEEDING ARISING OUT OF OR
RELATED TO THIS GUARANTY OR THE OTHER LOAN DOCUMENTS. SUBJECT TO THE TERMS OF
SECTION 8.17, GUARANTOR WAIVES ANY OBJECTION WHICH GUARANTOR MAY HAVE BASED ON
LACK OF JURISDICTION OR IMPROPER VENUE OR FORUM NON CONVENIENS TO ANY SUIT OR
PROCEEDING INSTITUTED BY LENDER UNDER THIS GUARANTY OR THE OTHER LOAN DOCUMENTS
IN ANY STATE OR FEDERAL COURT LOCATED WITHIN DADE COUNTY, FLORIDA AND CONSENTS
TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY
THE COURT. SUBJECT TO THE TERMS OF SECTION 8.17, NOTHING IN THIS SECTION 8.18
SHALL AFFECT THE RIGHT OF LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT THE RIGHT OF LENDER TO BRING ANY ACTION OR PROCEEDING
AGAINST GUARANTOR OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION WHICH
HAS JURISDICTION OVER GUARANTOR OR ITS PROPERTY. SUBJECT TO THE TERMS OF SECTION
8.17, THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO THIS
GUARANTY AND THE OTHER LOAN DOCUMENTS, MAKE THE LOANS AND EXTEND THE OTHER
FINANCIAL ACCOMMODATIONS CONTEMPLATED HEREUNDER AND THEREUNDER.
IN WITNESS WHEREOF, Guarantor has caused this Guaranty and Security
Agreement to be executed and sealed in its corporate name by its duly authorized
corporate officer as of the date first above written.
METRO-TEL CORP.
By: /s/ Xxxxxxx Xxxxxxx
----------------------
Name: Xxxxxxx Xxxxxxx
Title: President
Accepted and acknowledged by:
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxx Xxxx
---------------------------
Name: Xxxxxx Xxxx
Title: Vice President
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