Exhibit 10.3
The Alliance Portfolio
Guaranty Agreement
THIS GUARANTY AGREEMENT, is made this September 12, 2005 by the undersigned
General Environmental Management, Inc, a Delaware Corporation ("Guarantor(s)")
in favor of The Alliance Portfolio its successors and / or assigns
("Creditors").
FOR VALUE RECEIVED, Guarantors, jointly and severally, if more than one,
hereby unconditionally and absolutely guarantee to Creditor the prompt and full
payment and performance, when due, of all indebtedness and obligations arising
in connection with the New loan for $1,250,000.00 on 00000 Xxxxx Xxxx Xxxx,
Xxxxxx Xxxxxxx, XX 00000 made to Republic Electric and General Environmental
Management of Rancho Xxxxxxx, LLC, a California Limited Liability Company
(hereinafter called "Debtor") by Creditor, and Lease Agreement dated
September12, 2005 by and between General Environmental Management, Inc (Lessee)
and General Environmental Management of Rancho Xxxxxxx LLC(Lessor) with a
guaranteed rental amount of $16,350.00 NNN per month as per Lease and amendments
thereto, if any, fixed or contingent and whether arising by notes, guarantees,
discounts, overdrafts, letters of credit and or applications, reimbursements and
loan agreements related thereto, or in any other manner, whether now existing or
hereinafter arising, including, without limitation, interest and collection
costs specified in any document evidencing, securing or pertaining to any such
indebtedness and obligations (said indebtedness and obligations being
hereinafter collectively called the "Indebtedness").
1. CONTINUING GUARANTY: This is a continuing Guaranty and shall apply to the
Indebtedness and any renewals, extensions, refinancings and modifications
thereof. However, Guarantors, or any of them, may give written notice to
Creditor that the Guarantors giving such notice will not be liable
hereunder for any future Indebtedness incurred after the giving of such
notice, but the obligation of all other Guarantors shall continue as to all
such Indebtedness as if such other Guarantors had been the only ones
signing this instrument. All Indebtedness incurred pursuant to any loan
payment between Creditor and Debtor entered into prior to receipt by
Creditor of any notice referred to in this Guaranty, including notice of
death of any Guarantors, shall be deemed to be Indebtedness incurred prior
to receipt of any such notice shall not be considered as given until
actually received by an officer of Creditor.
2. SUIT AGAINST GUARANTORS: Suit may be brought against Guarantors, jointly
and severally and against less than all of them, without impairing the
rights of Creditor against the other Guarantors; and Creditor may
compromise with any Guarantors for less than all of the Indebtedness and
release any Guarantor for all further liability to creditor for the
Indebtedness without impairing the right of Creditor to demand and collect
the balance of the Indebtedness from other Guarantors not so released, but
it is agreed among Guarantors that such
compromising and release shall not impair the rights of Guarantors as among
themselves.
3. OTHER REMEDIES: Creditor shall not be required to pursue any other remedies
before invoking the benefits of this Guaranty; specifically, Creditor shall
not be required to take any action against Debtor or any other person, to
exhaust its remedies against endorsers, collateral and other security, or
to resort to any balance of any deposit account or credit on the books of
Creditor in favor of Debtor or any other person.
4. OBLIGATIONS NOT IMPAIRED: The obligations of Guarantors under this Guaranty
shall not be released or impaired without the express prior written consent
of Creditor. Without limiting the generality of the foregoing, the
obligations of Guarantors shall not be released or impaired on account of
the following events:
(a) the voluntary or involuntary liquidation, sale or other disposition of
all or substantially all of the assets of debtor, or any receivership,
insolvency, bankruptcy, reorganization or other similar proceedings
affecting Debtor or any of its assets:
(b) the addition of a new Guarantor or Guarantors:
(c) any impairment, modification, release or limitation of liability of,
or stay of lien enforcement proceedings against, Debtor, its property,
or its estate in bankruptcy or any modification, discharge or
extension of the Indebtedness resulting from the operation of any
present or future provision of the Federal Bankruptcy Code or any
other similar federal or state statute, or from the decision of any
court, it being the intention hereof that Guarantors shall remain
liable on the Indebtedness, notwithstanding any act, omission or thing
which might, but for the provisions hereof, otherwise operate as a
legal or equitable discharge of Guarantors;
(d) Creditor's failure to use diligence in preserving the liability of any
person on the Indebtedness, or in bringing suit to enforce collection
of the Indebtedness;
(e) the substitution or withdrawal of collateral or release of security,
and the exercise or failure to exercise by Creditor of any right
conferred upon it herein or in any collateral agreement;
(f) if Debtor is not liable because the act of creating the Indebtedness
is ultra xxxxx or the officers or persons creating the Indebtedness
acted in excess of their authority, or for any reason the Indebtedness
cannot be enforced against Debtor;
(g) any payment by Debtor to Creditor if such payment is held to
constitute a preference under the bankruptcy laws, or if for any other
reason Creditor is required to refund such payment to Debtor or pay
the amount thereof to any other party;
(h) if guarantors are or become liable for any Indebtedness owing by
Debtor to Creditor, by endorsement or otherwise, other than under this
Guaranty; or
(i) if this Guaranty is ever deemed invalid or unenforceable as to any of
the Guarantors.
5. WAIVERS: Guarantors hereby waive and agree not to assert as a defense to
this Guaranty Agreement or to otherwise take advantage of
(a) any right to require Creditor to proceed agains Debtor or any other
person or to proceed against or exhaust any security held by Creditor
at any time or to pursue any other remedy in creditor's power before
proceeding against any Guarantor;
(b) the defense of the statute of limitations in an action hereunder or in
any action for the collection of any indebtedness or the performance
of any other obligation hereby guaranteed;
(c) any defense that may arise by reason of the incapacity, lack of
authority, death or disability of any other person or persons or the
failure of Creditor to file or enforce a claim against the estate in
administration, bankruptcy or any other proceeding of any other person
or persons;
(d) Creditor's failure to exercise diligence in the collection of the
Indebtedness, the granting of any extension to Debtor, demand, protest
and notice of any kind including, without limiting the generality of
the foregoing, notice of the existence, creation or incurring of any
new or additional indebtedness or obligation or of any action or
non-action on the part of Debtor, Creditor, any endorser or creditor
of Debtor or Guarantors or on the part of any other person whomsoever
under this or any other instrument in connection with any obligation
or evidence of indebtedness held by Creditor as collateral or in
connection with the Indebtedness and obligations hereby guaranteed;
(e) any defense based upon an election of remedies by Creditor, including
without limitation an election to proceed by non-judicial rather than
judicial foreclosure, which destroys or otherwise impairs the
subrogation rights of Guarantors to the right of Guarantors to proceed
against Debtor for reimbursement, or both; and
(f) any duty on the part of Creditor to disclose to Guarantors any facts
Creditor may now or hereafter know about Debtor, regardless of whether
Creditor has
reason to believe that any such facts materially increase the risk
beyond that which Guarantors intend to assume or has reason to believe
that any such facts are unknown to Guarantors or has a reasonable
opportunity to communicate such facts to Guarantors, it being
understood and agreed that Guarantors are fully responsible for being
and keeping informed of the financial condition of Debtor and of all
circumstances bearing on the risk of non-payment of any indebtedness
hereby guaranteed or non-performance of any other obligation hereby
guaranteed. In addition, without limiting the generality of the
foregoing, Guarantor expressly waves any and all benefits under
California Civil Code Sections 2809, 2810, 2819, 2845, 2849, 2850 and
2855, and California Code of Civil Procedure Sections 580a, 580b, and
580d.
6. BENEFIT TO GUARANTORS: Guarantors acknowledge and warrant that they derived
or expect to derive financial and other advantage and benefit, directly or
indirectly, from the Indebtedness and each and every advance thereof and
from each and every renewal, extension, release of collateral or other
relinquishment of legal rights made or granted or to be granted by Creditor
to Debtor in an amount not less than the amount guaranteed hereunder.
7. GUARANTOR'S WARRANTIES AND REPRESENTATIONS:
(a) Other than as disclosed in writing to Creditor, there are no material
conditions, circumstances, events, agreements, material actions,
suits, or proceeding pending or, to the knowledge of Guarantors,
threatened in any court or before or by any governmental authority
against or affecting Guarantors or, to the actual knowledge of
Guarantors, against or affecting Debtor or the property securing the
Indebtedness (the "Property"). The consummation of the transactions
contemplated hereby will not result in a breach of, or constitute a
default in, any mortgage, deed of trust, lease, promissory note, loan
agreement, credit agreement, partnership agreement or other agreement
to which Guarantors are a party or by which Guarantors may be bound or
affected. To the actual knowledge of Guarantors, Guarantors are not in
default under any laws ordinances, statutes, codes, rules,
regulations, orders or decrees of any governmental authorities which
would impair Guarantors' ability to perform their obligations under
this Guaranty.
(b) All of the instruments evidencing, governing, guaranteeing or securing
the Indebtedness (the "Loan Instruments"), including, without
limitation, this Guaranty and any other documents referred to herein
to which Guarantors are a party, will, upon execution and delivery,
constitute the duly authorized, valid and binding obligations of
Guarantors, enforceable in accordance with their terms, except as
limited by applicable debtor relief laws. No basis presently exists
for any claim by guarantors against Creditor under the Loan
Instruments, and enforcement of the Loan Instruments is subject to no
defenses, counterclaims or offsets.
(c) The representations and warranties contained in the Loan Instruments
are made as an inducement to Creditor to enter into the Loan
Instruments, and Guarantors understand that Creditor is relying on
such representations and warranties, and that such representations and
warranties shall remain true and correct so long as any part of the
Indebtedness remains outstanding and shall survive any (i) bankruptcy,
insolvency, receivership or other debtor relief laws or proceedings
involving Debtor, Guarantors or the Property, (ii) foreclosure of any
mortgage or other lien or security interest instrument securing the
Indebtedness, or (iii) conveyance of title to the Property in Lieu of
foreclosure.
(d) All financial statements, schedules, opinions, certificates,
confirmations, statements, applications, affidavits, agreements and
other materials submitted by Guarantors to Creditor in connection with
the Loan Instruments fairly state the matters with which they purport
to deal, and neither misstate any material fact nor, whether read
separately or in the aggregate, fail to state any material fact
necessary to make the statements not misleading.
8. SUBORDINATION: Guarantors hereby subordinate any and all indebtedness of
Debtor now and hereafter owed to any of the Guarantors to the Indebtedness,
and agree with Creditor that Guarantors shall not demand or accept any
payment of principal or interest from Debtor, shall not claim any offset or
other reduction of Guarantors' obligations hereunder because of any such
indebtedness and shall not take any action to obtain any of the collateral
securing the Indebtedness; provided, however, that, if Creditor so
requests, any Indebtedness of Debtor to any of the Guarantors shall be
collected, enforced and received by Guarantors as trustee for Creditor and
be paid over to Creditor on account of the Indebtedness, but without
reducing or affecting in any manner the liability of Guarantors under the
other provisions of the Guaranty.
9. DEATH OF GUARANTOR: Upon the death of any of the Guarantors, the obligation
of the deceased shall continue against his estate as to all Indebtedness
which shall have been incurred by Debtor prior to the actual receipt by an
officer of Creditor of written notice of such death; and this Guaranty
shall continue in full force as to the surviving Guarantors as to all
Indebtedness incurred before and after such death.
10. FINANCIAL STATEMENTS: Each of the Guarantors warrants an represents to
Creditor that all financial statements heretofore delivered by Guarantors
to Creditor are true and correct, that there are no material adverse
changes as of the date hereof and that the execution hereof does not nor
shall not render Guarantors insolvent. So long as any of the Indebtedness
remains outstanding, Guarantors shall provide Creditor with then current
financial statements, in form and substance satisfactory to Creditor,
within thirty (30) days following a request by Creditor.
11. COMPLIANCE WITH LOAN INSTRUMENTS: Guarantors shall comply with, observe and
be bound by the provisions of the Loan Instruments which pertain to
Guarantors.
12. WAIVER OF NOTICE: Guarantors waive diligence on the part of Creditor in the
collection of the Indebtedness, protest, notice, notice of intention to
accelerate the maturity of any of the Indebtedness, notice of the
acceleration of any of the Indebtedness, and all extensions that may be
granted to Debtor. Creditor shall be under no obligation to notify
Guarantors of its acceptance hereof, nor of any advances made or credit
extended on the faith hereof, nor of the failure of Debtor to pay the
Indebtedness as it matures.
13. LIMITATION ON INTEREST: To the extent that any law limiting the amount of
interest that may be contracted for, charged or received is applicable to
the obligations of Guarantors under this Guaranty, no provision of this
Guaranty shall require the payment or permit the collection of any sum in
excess of the maximum lawful amount applicable to Guarantors' obligations
under this Guaranty. If any sum in excess of the maximum lawful amount
applicable to Guarantors' obligations under this Guaranty is provided for
herein, the provisions of this paragraph shall govern, and Guarantors shall
not be obligated to pay any sum in excess of the maximum lawful amount
applicable to Guarantors' obligations under the Guaranty. The intention of
Guarantors and Creditor hereunder is to comply with all laws applicable to
this Guaranty and Guarantors' obligations hereunder.
14. MODIFICATION OR CONSENT: No modification, consent or waiver of any
provision of this Guaranty, or consent to any departure by any of the
Guarantors therefrom, shall be effective unless the same shall be in
writing and signed by and officer of Creditor, and then shall be effective
only in the specific instance and for the purpose of which given. No notice
to or demand on any Guarantors in any case shall, of itself, entitle any
Guarantors to any other or further notice or demand in similar or other
circumstances. No delay or omission by Creditor in exercising any power or
right hereunder shall impair any such right or power to be construed as a
waiver thereof or any acquiescence therein, nor shall any single or partial
exercise of any such power preclude other or further exercise thereof or
the exercise of any other right or power hereunder. All rights and remedies
of Creditor hereunder are cumulative of each other and of every other right
or remedy which Creditor may otherwise have at law or in equity or under
any other contract or document, and the exercise of one or more rights or
remedies shall not preclude or impair the concurrent or subsequent exercise
of other rights or remedies.
15. INDUCEMENT TO CREDITOR: Guarantors acknowledge that this Guaranty is given
to induce Creditor to extend credit to Debtor which would not be extended
except in reliance upon this Guaranty.
16. COST OF COLLECTION: Guarantors agree to pay all costs of collection,
including reasonable attorneys' fees and expenses, if this Guaranty is
placed in the hands of an attorney for collection or is collected through
any court.
17. NOTICE OF LITIGATION, CLAIMS AND FINANCIAL CHANGE: Guarantors shall
promptly inform Creditor of
(a) any litigation against any Guarantors or affecting any security for
the Indebtedness which, if determined adversely, might have a material
adverse effect upon the financial condition of any of the Guarantors
or upon such security or might cause a default under any of the
documents evidencing, securing or governing the Indebtedness,
(b) any claim or controversy which might become the subject of such
litigation, and
(c) any material adverse change in the financial condition of any of the
Guarantors. For purposed hereof, material adverse change shall mean a
decline of fifteen percent (15%) in the net worth of any of the
Guarantors as shown on the financial statement of each of the
Guarantors delivered to Creditor in connection with that Indebtedness.
18. PARTICIPATION: Guarantors acknowledge and agree the Creditor may from time
to time sell or offer to sell interest in the Indebtedness and the loan
instruments to one or more participants. Guarantors authorize Creditor to
disseminate any information it has pertaining to the Indebtedness,
including without limitation, complete and current credit information on
Debtor, any of its principals and Guarantors, to any such participant or
prospective participant.
19. SUCCESSORS AND ASSIGNS: This Guaranty is for the benefit of Creditor, its
successors and assigns, and in the event of any assignment by Creditor, its
successors and assigns, of the Indebtedness, or any part thereof, the
rights and benefits hereunder, to the extent applicable to the Indebtedness
to assigned, may be transferred with such Indebtedness.
20. COUNTERPARTS: This Guaranty may be executed in a number of identical
counterparts, each of which for all purposes is deemed an original;
further, the failure of any one or more Guarantors to execute a counterpart
hereof shall not affect or impair the validity of enforceability of this
Guaranty against any other Guarantors who may execute any guaranty in
connection with the Indebtedness.
21. HEADINGS: The paragraph headings hereof are inserted for convenience of
reference only and shall not alter, define or be used in construing the
text of such paragraphs.
22. GOVERNING LAW AND PLACE OF PERFORMANCE:
GUARANTORS AGREE THAT THIS AGREEMENT IS GOVERNED BY THE LAWS OF THE
STATE OF CALIFORNIA. THIS AGREEMENT IS PERFORMABLE IN ORANGE COUNTY,
CALIFORNIA, AND GUARANTORS HEREBY WAIVE THE RIGHT TO BE SUED ELSEWHERE.
GUARANTORS ACKNOWLEDGE THAT THS AGREEMENT WAS NEGOTIATED IN ORANGE ------
COUNTY, CALIFORNIA, AND WILL BE DEEMED TO BE DELIVERED WHEN DELIVERED TO
CREDITOR IN ORANGE COUNTY, CALIFORNIA.
23. SEVERABILITY: If any provision of this Guaranty is held to be illegal,
invalid, or unenforceable under present or future laws effective while this
Guaranty is in effect, the legality, validity and enforceability of the
remaining provisions of this Guaranty shall not be affected thereby, and in
lieu of each such illegal, invalid or unenforceable provision there shall
be added automatically as a part of this Guaranty a provision which is
legal, valid and enforceable and as similar in terms to such illegal,
invalid and unenforceable provision as my be possible.
GUARANTOR(S):
General Environmental Management Inc,
A Delaware Corporation
By:_/S/ X. Xxxxxx, Director
