GUARANTY
Exhibit 10.2
GUARANTY
Parsippany, New Jersey | February 21, 2007 |
FOR VALUE RECEIVED, and in consideration of the issuance of and/or drawings under letters of
credit issued by Wachovia Bank, National Association under the applications by Xxxxxxx Radio Macao
Commercial Offshore Limited, a subsidiary of XXXXXXX RADIO CORP., a Delaware corporation
(“Lender”), for the benefit of CAPETRONIC DISPLAY LIMITED, NAKAMICHI CORPORATION, AKAI ELECTRIC
(CHINA) CO. LTD. and/or SANSUI ELECTRIC (CHINA) CO. LTD., each of which is a wholly owned
subsidiary of the undersigned (each, a “Borrower”, and, collectively, “Borrowers”), under Letter of
Credit Nos. IC611935H, IC611936H, IC611982H, IC612205H, IC612206H, IC612968H, IC613030H, IC613031H,
IC613372H and IC613373H (the “Letters of Credit”), the obligations of Borrowers to repay such
amounts is evidenced by the Promissory Note, dated as of February 21, 2007, issued by the Borrowers
to Lender (as the same may be amended, restated, supplemented or otherwise modified from time to
time, the “Promissory Note”), and for other good and valuable consideration, the undersigned
(hereinafter referred to as “Guarantor” or “the undersigned”) unconditionally guarantees to Lender,
its successors, endorsees and assigns the prompt payment when due (whether by acceleration or
otherwise) of all present and future obligations and liabilities of any and all kinds of Borrowers
to Lender and of all instruments of any nature evidencing or relating to any such obligations and
liabilities upon which any Borrower or one or more parties and any Borrower is or may become liable
to Lender, whether incurred by any Borrower as maker, endorser, drawer, acceptor, guarantor,
issuer, accommodation party or otherwise, and whether due or to become due, secured or unsecured,
absolute or contingent, joint or several, and however or whenever acquired, directly or indirectly,
by Lender, whether arising under, out of, or in connection with the Promissory Note or any
documents, instruments or agreements relating to or executed in connection with the Promissory Note
or any documents, instruments or agreements referred to in the Promissory Note (together with the
Promissory Note, as each may be amended, modified, restated or supplemented from time to time, the
“Loan Documents”), or otherwise (all of which are herein collectively referred to as the
“Obligations”), and irrespective of the genuineness, validity, regularity or enforceability of such
Obligations, or of any instrument evidencing any of the Obligations or of any collateral therefor
or of the existence or extent of such collateral, and irrespective of the allowability, allowance
or disallowance of any or all of the Obligations in any case commenced by or against any Borrower
under any Insolvency Law (as defined in Section 2 hereof), including, without limitation,
obligations or indebtedness of any Borrower for post-petition interest, fees, costs and charges
that would have accrued or been added to the Obligations but for the commencement of such case. In
furtherance of the foregoing, the undersigned xxxxxx agrees as follows:
1. No Impairment. Lender may at any time and from time to time, either before or
after the maturity thereof, without notice to or further consent of the undersigned, extend the
time of payment of, exchange or surrender any collateral for, renew or extend any of the
Obligations or increase or decrease the interest rate thereon, and may also make any agreement with
any Borrower or with any other party to or person liable on any of the Obligations, or interested
therein, for the extension, renewal, payment, compromise, discharge or release thereof, in whole or
in part, or for any modification of the terms thereof or of any agreement between
Lender and any Borrower or any such other party or person, or make any election of rights
Lender may deem desirable under Title 11 of the United States Code entitled “Bankruptcy,” as now
and hereafter in effect, or any successor statute, or any other federal, state or foreign
bankruptcy, reorganization, moratorium or insolvency law relating to or affecting the enforcement
of creditors’ rights generally (any of the foregoing, an “Insolvency Law”) without in any way
impairing or affecting this Guaranty. This instrument shall be effective regardless of the
subsequent merger or consolidation of Borrower, or any change in the composition, nature,
personnel, jurisdiction or organization or location of Borrower and shall extend to any successor
entity to Borrower, including a debtor in possession or the like under any Insolvency Law.
2. Guaranty Absolute. The undersigned guarantees that the Obligations will be paid
strictly in accordance with the terms of the Promissory Note and/or any other document, instrument
or agreement creating or evidencing the Obligations, regardless of any law, regulation or order now
or hereafter in effect in any jurisdiction affecting any of such terms or the rights of any
Borrower with respect thereto. Guarantor hereby knowingly accepts the full range of risk
encompassed within a contract of “continuing guaranty” which risk includes the possibility that one
or more Borrowers will contract additional indebtedness for which Guarantor may be liable hereunder
after any such Borrower’s financial condition or ability to pay its lawful debts when they fall due
has deteriorated, whether or not any such Borrower has properly authorized incurring such
additional indebtedness. The undersigned acknowledges that (i) no oral representations, including
any representations to extend credit or provide other financial accommodations to the Borrowers,
have been made by Lender to induce the undersigned to enter into this Guaranty and (ii) any
extension of credit to the Borrowers shall be governed solely by the provisions of the Promissory
Note. The liability of the undersigned under this Guaranty shall be absolute and unconditional, in
accordance with its terms, and shall remain in full force and effect without regard to, and shall
not be released, suspended, discharged, terminated or otherwise affected by, any circumstance or
occurrence whatsoever, including, without limitation: (a) any waiver, indulgence, renewal,
extension, amendment or modification of or addition, consent or supplement to or deletion from or
any other action or inaction under or in respect of the Loan Documents or any other instruments or
agreements relating to the Obligations or any assignment or transfer of any thereof, (b) any lack
of validity or enforceability of any Loan Document or other documents, instruments or agreements
relating to the Obligations or any assignment or transfer of any thereof, (c) any furnishing of any
additional security to Lender or its assignees or any acceptance thereof or any release of any
security by Lender or its assignees, (d) any limitation on any party’s liability or obligation
under the Loan Documents or any other documents, instruments or agreements relating to the
Obligations or any assignment or transfer of any thereof or any invalidity or unenforceability, in
whole or in part, of any such document, instrument or agreement or any term thereof, (e) any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other
like proceeding relating to Borrower, or any action taken with respect to this Guaranty by any
trustee or receiver, or by any court, in any such proceeding, whether or not the undersigned shall
have notice or knowledge of any of the foregoing, (f) any exchange, release or nonperfection of any
collateral, or any release, or amendment or waiver of or consent to departure from any guaranty or
security, for all or any of the Obligations or (g) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the undersigned. Any amounts due from the
undersigned to Lender shall bear interest until such amounts are paid in full at the highest rate
then applicable to the Obligations. Obligations include post-petition interest whether or not
allowed or allowable.
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3. Waivers. (a) This Guaranty is a guaranty of payment and not of collection. Lender
shall be under no obligation to institute suit, exercise rights or remedies or take any other
action against any Borrower or any other person liable with respect to any of the Obligations or
resort to any collateral security held by it to secure any of the Obligations as a condition
precedent to the undersigned being obligated to perform as agreed herein and Guarantor hereby
waives any and all rights which it may have by statute or otherwise which would require Lender to
do any of the foregoing. Guarantor further consents and agrees that Xxxxxx shall be under no
obligation to marshal any assets in favor of Guarantor, or against or in payment of any or all of
the Obligations. The undersigned hereby waives all suretyship defenses and any rights to interpose
any defense, counterclaim or offset of any nature and description which the undersigned may have or
which may exist between and among Lender, any Borrower and/or the undersigned with respect to the
undersigned’s obligations under this Guaranty, or which any Borrower may assert on the underlying
debt, including but not limited to failure of consideration, breach of warranty, fraud, payment
(other than cash payment in full of the Obligations), statute of frauds, bankruptcy, infancy,
statute of limitations, accord and satisfaction, and usury.
(b) The undersigned further waives (i) notice of the acceptance of this Guaranty, of the
making of any such loans or extensions of credit, and of all notices and demands of any kind to
which the undersigned may be entitled, including, without limitation, notice of adverse change in
any Borrower’s financial condition or of any other fact which might materially increase the risk of
the undersigned and (ii) presentment to or demand of payment from anyone whomsoever liable upon any
of the Obligations, protest, notices of presentment, non-payment or protest and notice of any sale
of collateral security or any default of any sort.
(c) Notwithstanding any payment or payments made by the undersigned hereunder, or any setoff
or application of funds of the undersigned by Xxxxxx, the undersigned shall not be entitled to be
subrogated to any of the rights of Lender against any Borrower or against any collateral or
guarantee or right of offset held by Lender for the payment of the Obligations, nor shall the
undersigned seek or be entitled to seek any contribution or reimbursement from any Borrower in
respect of payments made by the undersigned hereunder, until all amounts owing to Lender by any
Borrower on account of the Obligations are paid in full and the Promissory Note has been
terminated. If, notwithstanding the foregoing, any amount shall be paid to the undersigned on
account of such subrogation rights at any time when all of the Obligations shall not have been paid
in full and the Promissory Note shall not have been terminated, such amount shall be held by the
undersigned in trust for Lender, segregated from other funds of the undersigned, and shall
forthwith upon, and in any event within two (2) business days of, receipt by the undersigned, be
turned over to Lender in the exact form received by the undersigned (duly endorsed by the
undersigned to Lender, if required), to be applied against the Obligations, whether matured or
unmatured, in such order as Lender may determine, subject to the provisions of the Promissory Note.
Any and all present and future debts and obligations of any Borrower to the undersigned are hereby
waived and postponed in favor of, and subordinated to the full payment and performance of, all
present and future debts and obligations of Borrowers to Lender.
4. Security. All sums at any time to the credit of the undersigned and any property
of the undersigned in Lender’s possession or in the possession of any bank, financial institution
or other entity that directly or indirectly, through one or more intermediaries, controls or is
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controlled by, or is under common control with, Lender (each such entity, an “Affiliate”)
shall be deemed held by Lender or such Affiliate, as the case may be, as security for any and all
of the undersigned’s obligations to Lender and to any Affiliate of Lender, no matter how or when
arising and whether under this or any other instrument, agreement or otherwise.
5. Representations and Warranties. The undersigned hereby represents and warrants
(all of which representations and warranties shall survive until all Obligations are indefeasibly
satisfied in full and the Promissory Note has been irrevocably terminated), that:
(a) Corporate Status. The undersigned is a corporation duly organized, validly
existing and in good standing under the laws of Bermuda and has full power, authority and
legal right to own its property and assets and to transact the business in which it is
engaged.
(b) Authority and Execution. The undersigned has full power, authority and
legal right to execute and deliver, and to perform its obligations under, this Guaranty and
has taken all necessary corporate and legal action to authorize the execution, delivery and
performance of this Guaranty.
(c) Legal, Xxxxx and Binding Character. This Guaranty constitutes the legal,
valid and binding obligation of the undersigned enforceable in accordance with its terms,
except as enforceability may be limited by applicable Insolvency Law.
(d) Violations. The execution, delivery and performance of this Guaranty will
not violate any requirement of law applicable to the undersigned or any material contract,
agreement or instrument to which the undersigned is a party or by which the undersigned or
any property of the undersigned is bound or result in the creation or imposition of any
mortgage, lien or other encumbrance other than to Lender on any of the property or assets of
the undersigned pursuant to the provisions of any of the foregoing.
(e) Consents or Approvals. No consent of any other person or entity
(including, without limitation, any creditor of the undersigned) and no consent, license,
permit, approval or authorization of, exemption by, notice or report to, or registration,
filing or declaration with, any governmental authority is required in connection with the
execution, delivery, performance, validity or enforceability of this Guaranty.
(f) Litigation. No litigation, arbitration, investigation or administrative
proceeding of or before any court, arbitrator or governmental authority, bureau or agency is
currently pending or, to the best knowledge of the undersigned, threatened (i) with respect
to this Guaranty or any of the transactions contemplated by this Guaranty or (ii) against or
affecting the undersigned, or any of property or assets of the undersigned, which, if
adversely determined, would have a material adverse effect on the business, operations,
assets or condition, financial or otherwise, of the undersigned.
(g) Financial Benefit. The undersigned has derived or expects to derive a
financial or other advantage from the benefits derived by Borrowers under the Letters of
Credit or any other Obligation incurred by Borrower to Lender.
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6. Acceleration. (a) If any breach of any covenant or condition or other event of
default shall occur and be continuing under any agreement made by any Borrower or the undersigned
to Lender, or any Borrower or the undersigned should at any time become insolvent, or make a
general assignment, or if a proceeding in or under any Insolvency Law shall be filed or commenced
by, or in respect of, the undersigned, or if a notice of any lien, levy, or assessment is filed of
record with respect to any assets of the undersigned by the United States of America or any
department, agency, or instrumentality thereof, or if any taxes or debts owing at any time or times
hereafter to any one of them becomes a lien or encumbrance upon any assets of the undersigned in
Lender’s possession, or otherwise, any and all Obligations shall for purposes hereof, at Lender’s
option, be deemed due and payable without notice notwithstanding that any such Obligation is not
then due and payable by Borrower.
(b) The undersigned will promptly notify Lender of any default by the undersigned in the
performance or observance of any term or condition of any agreement to which the undersigned is a
party if the effect of such default is to cause, or permit the holder of any obligation under such
agreement to cause, such obligation to become due prior to its stated maturity and, if such an
event occurs, Lender shall have the right to accelerate the undersigned’s obligations hereunder.
7. Payments from Guarantor. Lender, in its sole and absolute discretion, with or
without notice to the undersigned, may apply on account of the Obligations any payment from the
undersigned or any other guarantor, or amounts realized from any security for the Obligations, or
may deposit any and all such amounts realized in a non-interest bearing cash collateral deposit
account to be maintained as security for the Obligations.
8. Costs. The undersigned shall pay on demand, all costs, fees and expenses
(including expenses for legal services of every kind) relating or incidental to the enforcement or
protection of the rights of Lender hereunder or under any of the Obligations.
9. No Termination. This is a continuing irrevocable guaranty and shall remain in full
force and effect and be binding upon the undersigned, and the undersigned’s successors and assigns,
until all of the Obligations have been paid in full and the Promissory Note has been irrevocably
terminated.
10. Recapture. Anything in this Guaranty to the contrary notwithstanding, if Lender
receives any payment or payments on account of the liabilities guaranteed hereby, 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 Insolvency Law, common law or equitable doctrine, then to the extent of any sum not
finally retained by Xxxxxx, the undersigned’s obligations to Lender shall be reinstated and this
Guaranty shall remain in full force and effect (or be reinstated) until payment shall have been
made to Lender, which payment shall be due on demand.
11. Books and Records. The books and records of Xxxxxx showing the account between
Xxxxxx and Borrower shall be admissible in evidence in any action or proceeding, shall be binding
upon the undersigned for the purpose of establishing the items therein set forth and shall
constitute prima facie proof thereof.
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12. No Waiver. No failure on the part of Lender to exercise, and no delay in
exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise by Lender of any right, remedy or power hereunder preclude any other or
future exercise of any other legal right, remedy or power. Each and every right, remedy and power
hereby granted to Lender or allowed it by law or other agreement shall be cumulative and not
exclusive of any other, and may be exercised by Lender at any time and from time to time.
13. Waiver of Jury Trial. THE UNDERSIGNED DOES HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED ON OR WITH RESPECT
TO THIS GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR RELATING OR INCIDENTAL HERETO.
THE UNDERSIGNED DOES HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF XXXXXX HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT LENDER WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THIS
WAIVER OF RIGHT TO JURY TRIAL PROVISION.
14. Governing Law; Jurisdiction; Amendments. THIS INSTRUMENT CANNOT BE CHANGED OR
TERMINATED ORALLY, AND SHALL BE GOVERNED, CONSTRUED AND INTERPRETED AS TO VALIDITY, ENFORCEMENT AND
IN ALL OTHER RESPECTS IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THE UNDERSIGNED
EXPRESSLY CONSENTS TO THE JURISDICTION AND VENUE OF THE SUPREME COURT OF THE STATE OF NEW YORK,
COUNTY OF NEW YORK, AND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
FOR ALL PURPOSES IN CONNECTION HEREWITH. ANY JUDICIAL PROCEEDING BY THE UNDERSIGNED AGAINST LENDER
INVOLVING, DIRECTLY OR INDIRECTLY ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED TO OR
CONNECTED HEREWITH SHALL BE BROUGHT ONLY IN THE SUPREME COURT OF THE STATE OF NEW YORK, COUNTY OF
NEW YORK OR THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK. THE
UNDERSIGNED FURTHER CONSENTS THAT ANY SUMMONS, SUBPOENA OR OTHER PROCESS OR PAPERS (INCLUDING,
WITHOUT LIMITATION, ANY NOTICE OR MOTION OR OTHER APPLICATION TO EITHER OF THE AFOREMENTIONED
COURTS OR A JUDGE THEREOF) OR ANY NOTICE IN CONNECTION WITH ANY PROCEEDINGS HEREUNDER, MAY BE
SERVED INSIDE OR OUTSIDE OF THE STATE OF NEW YORK OR THE SOUTHERN DISTRICT OF NEW YORK BY
REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY PERSONAL SERVICE PROVIDED A
REASONABLE TIME FOR APPEARANCE IS PERMITTED, OR IN SUCH OTHER MANNER AS MAY BE PERMISSIBLE UNDER
THE RULES OF SAID COURTS. THE UNDERSIGNED WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY
ACTION INSTITUTED HEREON AND SHALL NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR
BASED UPON FORUM NON CONVENIENS.
15. Severability. To the extent permitted by applicable law, any provision of this
Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without invalidating the
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remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other jurisdiction.
16. Amendments, Waivers. No amendment or waiver of any provision of this Guaranty nor
consent to any departure by the undersigned therefrom shall in any event be effective unless the
same shall be in writing executed by the undersigned and Xxxxxx.
17. Notices. All notices, requests and demands to or upon (a) the undersigned, shall
be in writing and shall be deemed to have been duly given or made (i) when delivered, if by hand,
(ii) three (3) days after being sent, postage prepaid, if by registered or certified mail, (iii)
when confirmed electronically, if by facsimile or by e-mail of a Portable Document Format (PDF)
file, (iv) when delivered, if by a recognized overnight delivery service (in the case of the events
described in clauses (i) through (iv), inclusive, to the number and/or address set forth beneath
the signature of the undersigned), or (v) upon Lender or a person acting on its behalf making a
public announcement relating to this Guaranty and/or the Obligations (including, without
limitation, by including such information in a report filed with the U.S. Securities and Exchange
Commission by Lender), or (b) Lender, shall be deemed duly given or made (i) when delivered, if by
hand, or (ii) when delivered, if by a recognized overnight delivery service, in each case to the
principal offices of Lender located at 0 Xxxxx Xxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000.
18. Successors. Lender may, from time to time, without notice to the undersigned,
sell, assign, transfer, pledge, hypothecate or otherwise dispose of all or any part of the
Obligations and/or rights under this Guaranty. In each such event, Lender, its Affiliates and each
and every immediate and successive purchaser, assignee, transferee or holder of all or any part of
the Obligations shall have the right to enforce this Guaranty, by legal action or otherwise, for
its own benefit as fully as if such purchaser, assignee, transferee or holder were herein by name
specifically given such right. Lender shall have an unimpaired right to enforce this Guaranty for
its benefit with respect to that portion of the Obligations which Lender has not disposed of, sold,
assigned, or otherwise transferred.
19. Release. Nothing except cash payment in full in lawful money of the United States
of America of the Obligations shall release the undersigned from liability under this Guaranty.
[Signature Page Follows.]
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IN WITNESS WHEREOF, this Guaranty has been executed by the undersigned this 21st day of
February, 2007.
THE GRANDE HOLDINGS LIMITED, a Bermuda corporation |
||||
By: | /s/ Xxxxxxx Xxxxxx | |||
Name: | Xxxxxxx Xxxxxx | |||
Title: | Director | |||
Notice Address:
000 Xxxxxxxx Xxxx
#00-00
Xxxxxxxxx 000000
Attention: Xxxx Xxx Xxx Xxx, Esq., Managing Director, Legal
Telephone No.: 000-00-0000-0000
Facsimile No.:
E-mail Address: xxx@xxxxxx.xxx.xx
#00-00
Xxxxxxxxx 000000
Attention: Xxxx Xxx Xxx Xxx, Esq., Managing Director, Legal
Telephone No.: 000-00-0000-0000
Facsimile No.:
E-mail Address: xxx@xxxxxx.xxx.xx
Signature Page to Guaranty of
The Grande Holdings Limited
The Grande Holdings Limited