AMSOUTH
Continuing Guaranty Agreement Date: June 11, 1997
WHEREAS, the undersigned (hereinafter referred to as the "Guarantors,"
whether one or more) have agreed to guarantee, jointly and severally, the
payment of all credit heretofore or hereafter extended and all advances
heretofore or hereafter made by AmSouth Bank of Alabama (hereinafter referred to
as the "Bank") to Ridge Pointe Mfg., L.L.C. (hereinafter referred to as the
"Borrower"), and of all other Liabilities (as hereinafter defined) of the
Borrower to the Bank.
NOW, THEREFORE, in consideration of the premises, the sum of ten dollars to
each of the Guarantors in hand paid by the Bank, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
each of the Guarantors, and in order to induce the Bank to extend to the
Borrower from time to time such extensions of credit, advances and forebearances
as the Bank in its sole discretion may deem prudent and wise, the Guarantors,
jointly and severally, unconditionally and absolutely hereby guarantee the due
and punctual payment to the Bank when and as the same shall become due and
payable (whether by acceleration or otherwise) of the following (collectively,
the "Liabilities"): all indebtedness, obligations and liabilities of the
Borrower to the Bank of every kind, character and description whatsoever, direct
or indirect, absolute or contingent, due or to become due, now existing or
hereafter incurred, contracted or arising, joint or several, liquidated or
unliquidated, regardless of how they arise or by what agreement or instrument
they may be evidenced or whether they are evidenced by any agreement or
instrument, and whether incurred as maker, drawer, endorser, surety, guarantor
or otherwise, including without limitation obligations of the Borrower purchased
by the Bank, Recovered Payments, as hereinafter defined, and obligations
incurred in connection with the issuance of a letter of credit, and any and all
extensions and renewals of all or any part of the same.
The Guarantors further jointly and severally agree that, in the event the
Bank grants to the Borrower one or more extensions or renewals of any of the
Liabilities, or any part thereof, or permits or requires any other modification
in any of the terms of the Liabilities, or any part thereof, in any manner which
may be acceptable to the Bank, with or without notice to the Guarantors, this
guaranty shall, and is hereby made to extend to and cover such extended, renewed
or modified Liabilities, on whatever terms and conditions the same may be
extended, renewed or modified, and without regard to the number of times or the
manner in which the same may have been or shall be extended, renewed or
modified.
The Guarantors further jointly and severally agree (a) to pay any and all
of the Liabilities upon demand at any time after maturity thereof (whether by
acceleration or otherwise); (b) to be bound by all of the terms and provisions
appearing on the face of any instrument or agreement evidencing, securing,
guaranteeing, or executed in connection with any of the Liabilities and of any
renewal instrument or agreement (the "Loan Documents") (including any terms
waiving notice and agreeing to pay costs and expenses of collection in the event
of default) just as though the Guarantors had signed such instrument or
agreement; (c) that the Bank will not be required first to resort to the
Borrower or any other maker, endorser, surety, guarantor or other Guarantor
(each such Borrower, maker, endorser, surety, guarantor, or other Guarantor
being hereinafter individually called and "Obligor") or to the security pledged
or granted to it by any instrument or agreement, or otherwise assigned or
conveyed to it, but in case of default in the payment of any of the Liabilities
the Bank may forthwith look to the Guarantors jointly and severally for payment
under the provisions hereof; and (d) that the Bank's enforcement of the
Guarantors' obligations hereunder shall not be stayed or otherwise delayed by
any claim (including without limitation, a counterclaim) that any Obligor may
have against the Bank.
The Guarantors hereby further jointly and severally agree that the
obligations of the Guarantors hereunder are absolute, unconditional, present and
continuing guaranties of payment and not collectibility and shall not be subject
to any counterclaim, recoupment, set-off, reduction or defense based upon any
claim that the Guarantors, or any of them, may have against the Borrower or the
Bank and shall not be discharged, impaired, modified or otherwise affected by
(a) the unenforceability, non-existence, invalidity or non-perfection of (i) any
of the Liabilities, (ii) any Loan Documents, (iii) any renewal instrument or
agreement or (iv) any lien, pledge, assignment, security interest or conveyance
given as security therefor; (b) any understanding or agreement that any other
person, firm or corporation was or is to execute this agreement or any other
document evidencing, guaranteeing or securing the Liabilities, or any part
thereof; (c) Bank's resort or failure or refusal to resort to any other security
or remedy for the collection of the Liabilities, or any part thereof; (d) the
sale, exchange, release, surrender, or impairment of any collateral or other
security for the Liabilities, or any part thereof; (e) the death, insolvency or
bankruptcy of any Obligor or the failure of the Bank to file a claim against
such decreased or bankrupt Obligor's estate for such Obligor's liability or
obligation to the Bank; (f) any modification, amendment, supplement, or change
in the status or terms of any of the Liabilities or any collateral or other
security for the Liabilities, or any part thereof; (g) any default by the
Borrower in payment of any of the Liabilities; (h) any compromise, settlement,
release, discharge, termination, waiver, or extension of time for payment,
performance, or observance of, any obligation of any Obligor with respect to any
of the Liabilities; (i) the application of any payments, proceeds of collateral
or other sums to any of the Liabilities in such order as the Bank may elect; (j)
any exercise or non-exercise of any right, remedy, power, or privilege of the
Bank, with respect to any of the Liabilities or any collateral or other security
therefor; (k) any failure, omission, delay, or lack of diligence on the part of
Bank to enforce, assert, or exercise any such right, power, privilege, or
remedy; (l) any claim (including, but not limited to a counterclaim) that any
Obligor may have against the Bank; or (m) any other event, circumstance or
condition, whether or not the Guarantors, or any of the them, shall have notice
or knowledge thereof.
The Guarantors further jointly and severally agree that it shall not be
necessary for the Bank to give any Guarantor notice of or to obtain consent or
approval of any Guarantor in connection with, (a) the making of any advances or
any extensions of credit or the terms thereof, or of any renewal or extension of
or other modification with respect to the Liabilities, or any part thereof; (b)
any of the matters described in clauses (a) through (m) of the preceding
paragraph; or (c) the Bank's acceptance of and reliance on this agreement. The
terms hereof shall inure to the benefit of the successors and assigns of the
Bank and shall be binding, jointly and severally, upon the Guarantors, their
heirs, executors, administrators, successors and assigns.
Neither any failure nor any delay on the part of the Bank in exercising any
right, power or privilege under this agreement shall operate as a waiver
thereof, nor shall a single or partial exercise thereof preclude any other or
further exercise or the exercise of any other right, power or privilege. No
modification, amendment or waiver of any provision of this agreement shall be
effective unless in writing and signed by a duly authorized officer of the Bank,
and then the same shall be effective only in the specific instance and for the
purpose for which given. No notice to or demand on the Guarantors in any case
shall entitle the Guarantors to any other or further notice or demand in the
same, similar or other circumstances.
The Guarantors jointly and severally hereby agree to indemnify and hold the
Bank harmless against any loss or expense, including reasonable attorneys' fees
and disbursements, that may result from any failure of any Obligor to pay any of
the Liabilities when and as due and payable or that may be incurred by or on
behalf of the Bank in enforcing payment of any of the Liabilities against any of
the Guarantors or any of the Obligors; provided, however, that if this agreement
is subject to section 5-19-10 of the Code of Alabama 1975, attorneys' fees shall
be limited to 15% of the unpaid balance of the debt after default, and no
attorneys' fees shall be payable if the original principal amount or the
original amount financed does not exceed $300.
In addition to all liens upon, and rights of set-off against, any moneys,
securities, or other property of the Guarantors given to the Bank by law, the
Bank shall have a lien upon and a right of set-off against all deposits, moneys,
securities, and other property of any of the Guarantors now or hereafter in the
possession of, or on deposit with, the Bank, whether held in a general or
special account or deposit, for safekeeping, or otherwise; and every such lien
and right of set-off may be exercised without demand upon or notice to the
Guarantors.
Each of the Guarantors who now is or hereafter becomes an "insider," as
defined in 11 U.S.C. Section 101 (or any amendment or successor thereto or
replacement thereof), of the Borrower hereby waives and relinquishes all rights
(including without limitation rights of subrogation) that such Guarantor now has
or hereafter may have to recover from or be reimbursed by the Borrower or the
Borrower's property, or from any person, firm, or corporation that may now or
hereafter have such a right to recover from or be reimbursed by the Borrower or
the Borrower's property, any amounts paid by such Guarantor to satisfy, in whole
or in part, the Liabilities. The provisions of this paragraph are made for the
express benefit of the Borrower as well as the Bank and may be enforced
independently by the Borrower.
The Guarantors further jointly and severally agree that this agreement
shall remain in full force and effect until revoked or terminated by a written
instrument, signed by the Guarantors and delivered to the Bank and acknowledged
in writing by the Bank, and even after any such revocation or termination, shall
be and remain effective as to any Liabilities then outstanding; and that this
agreement shall not be construed as being terminated by payment in full of the
Liabilities to the Bank, if, thereafter, in the absence of written revocation or
termination by the Guarantors acknowledged by the Bank, the Borrower obtains or
incurs additional or new Liabilities. Notwithstanding the foregoing sentence,
this Continuing Guaranty Agreement and the Guarantors' obligations hereunder
shall continue to be effective or be automatically reinstated, as the case may
be, any time payment of all or any part of the Liabilities is recovered (a
"Recovered Payment") from the Bank as a result of a preference or other claim
made under any bankruptcy, insolvency, dissolution, liquidation, reorganization,
receivorship, or similar law or otherwise. The collateral, if any, securing this
Continuing Guaranty Agreement may be held by the Bank until it is satisfied that
all time periods during which the payment of all or any part of the Liabilities
may be recovered from the Bank as a result of a preference or other claim under
any bankruptcy, insolvency, dissolution, liquidation, reorganization,
receivorship, or similar law or otherwise have elapsed.
Any act or circumstance that shall toll any statute of limitations
applicable to the Liabilities, or any of them, shall also toll the statute of
limitations applicable to the Guarantors' liability for the Liabilities under
this Continuing Guaranty Agreement.
The term "Guarantors" as used herein refers to the undersigned, whether one
or more natural persons, corporations, associations, partnerships, or other
entities.
This agreement shall be governed by, and construed in accordance with,
Alabama law.
This agreement and the other Loan Documents contain the entire
understanding and agreement between the guarantors and the Bank with respect to
the obligations of the Guarantors hereunder and supersede any prior agreements,
understandings, promises, and statements with respect to such obligations.
Witness the signatures and seals of the undersigned on the day and year
first written above.
NOTICE TO COSIGNER
You are being asked to guarantee all debt of the borrower to this bank,
including all future debts of the borrower entered into with this bank prior to
the time you revoke or terminate this agreement in writing as set forth in this
agreement. Think carefully before you do. If the borrower doesn't pay the debt,
you will have to. Be sure you can afford to pay if you have to, and that you
want to accept this responsibility.
You may have to pay up to the full amount of the debt if the borrower does
not pay. You may also have to pay late fees or collection costs, which increase
this amount.
The bank can collect this debt from you without first trying to collect
from the borrower. The bank can use the same collection methods against you that
can be used against the borrower, such as suing you, garnishing your wages, etc.
If this debt is ever in default, that fact may become a part of your credit
record.
This notice is not the contract that makes you liable for the debt.
CAUTION-IT IS IMPORTANT THAT YOU THOROUGHLY READ THIS CONTRACT BEFORE YOU SIGN
IT.
Witness: Cavalier Homes, Inc. (L.S.)
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - President (L.S.)
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Exhibit A
to
Continuing Guaranty Agreement
Dated: June 11, 1997
Executed By: Cavalier Homes, Inc.
In Favor of AmSouth Bank of Alabama
(the "Guaranty Agreement")
This Exhibit is attached to and made a part of the Guaranty Agreement as
fully and completely as if set forth in full therein. Terms used in this Exhibit
shall have the meaning given to them in the Guaranty Agreement.
Notwithstanding anything to the contrary contained in the Guaranty
Agreement, the liability of each Guarantor under the Guaranty Agreement is
limited to a "certain percentage" of the principal of and interest on the
Liabilities and all extensions and renewals of the Liabilities or of any portion
thereof, from time to time and at any time outstanding (but without deduction
from the amount of the Liabilities any amounts that may theretofore have been,
or that may thereafter be, paid to the Bank by any other Guarantor under the
terms of the Guaranty Agreement or any other Agreement) plus the same percentage
of any costs of collection, including, without limitation, court costs and
attorneys' fees incurred by the Bank in the collection of any of the
Liabilities. The "certain percentage" applicable to each Guarantor shall be
equal to the percentage ownership of such Guarantor in the borrower at the time
payment is requested by the Bank under the Guaranty Agreement; provided,
however, that the "certain percentage: shall not be less than THIRTY-THREE
percent (33%).
Cavalier Homes, Inc.
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ - President
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