LIMITED GUARANTY
TO: Deutsche Financial Services Corporation
In consideration of financing provided or to be provided by you to ePlus
Technology of PA, inc. ("Dealer"), and for other good and valuable consideration
received, we jointly, severally, unconditionally and absolutely guaranty to you,
from property held separately, jointly or in community, the immediate payment
when due of all current and future liabilities owed by Dealer to you, whether
such liabilities are direct, indirect or owed by Dealer to a third party and
acquired by you ("Liabilities"). We will pay you on demand the full amount of
all sums owed by Dealer to you, together with all costs and expenses (including,
without limitation, reasonable attorneys' fees). We also indemnify and hold you
harmless from and against all (a) losses, costs and expenses you incur and/or
are liable for (including, without limitation, reasonable attorneys' fees) and
(b) claims, actions and demands made by Dealer or any third party against you,
which in any way relate to any relationship or transaction between you and
Dealer. Notwithstanding the foregoing, if you enforce this Guaranty our maximum
aggregate liability hereunder to you at such time will not exceed Four Million
Nine Hundred Thousand Dollars ($4,900,000.00).
Our guaranty will not be released, discharged or affected by, and we hereby
irrevocably consent to, any: (a) change in the manner, place, interest rate,
finance or other charges, or terms of payment or performance in any current or
future agreement between you and Dealer, the release, settlement or compromise
of or with any party liable for the payment or performance thereof or the
substitution, release, non-perfection, impairment, sale or other disposition of
any collateral thereunder; (b) change in Dealer's financial condition; (c)
interruption of relations between Dealer and you or us; (d) claim or action by
Dealer against you; and/or (e) increases or decreases in any credit you may
provide to Dealer. We will pay you even if you have not: (i) notified Dealer
that it is in default of the Liabilities, and/or that you intend to accelerate
or have accelerated the payment of all or any part of the Liabilities, or (ii)
exercised any of your rights or remedies against Dealer, any other person or any
current or future collateral. This Guaranty is assignable by you and will inure
to the benefit of your assignee. If Dealer hereafter undergoes any change in its
ownership, identity or organizational structure, this Guaranty will extend to
all current and future obligations which such new or changed legal entity owes
to you.
We irrevocably waive: notice of your acceptance of this Guaranty,
presentment, demand, protest, nonpayment, nonperformance, notice of breach or
default, notice of intent to accelerate and notice of acceleration of any
indebtedness of Dealer, any right of contribution from other guarantors,
dishonor, the amount of indebtedness of Dealer outstanding at any time, the
number and amount of advances made by you to Dealer in reliance on this Guaranty
and any claim or action against Dealer; all other demands and notices required
by law; all rights of offset and counterclaims against you or Dealer; all
defenses to the enforceability of this Guaranty (including, without limitation,
fraudulent inducement). We further waive all defenses based on suretyship or
impairment of collateral, and defenses which the Dealer may assert on the
underlying debt, including but not limited to, failure of consideration, breach
of warranty, fraud, payment, statute of frauds, bankruptcy, lack of legal
capacity, statute of limitations, lender liability, deceptive trade practices,
accord and satisfaction and usury. We also waive all rights to claim, arbitrate
for or sue for any punitive or exemplary damages. In addition, we hereby
irrevocably subordinate to you any and all of our present and future rights and
remedies: (a) of subrogation against Dealer to any of your rights or remedies
against Dealer, (b) of contribution, reimbursement, indemnification and
restoration from Dealer; and (c) to assert any other claim or action against
Dealer directly or indirectly relating to this Guaranty, such subordinations to
last until you have been paid in full for all Liabilities. All our waivers and
subordinations herein will survive any termination of this Guaranty.
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We have made an independent investigation of the financial condition of
Dealer and give this Guaranty based on that investigation and not upon any
representation made by you. We have access to current and future Dealer
financial information which enables us to remain continuously informed of
Dealer's financial condition. We represent and warrant to you that we have
received and will receive substantial direct or indirect benefit by making this
Guaranty and incurring the Liabilities. We will provide you with financial
statements on us each year within ninety (90) days after the end of Dealer's
fiscal year end. We warrant and represent to you that all financial statements
and information relating to us or Dealer which have been or may hereafter be
delivered by us or Dealer to you are true and correct and have been and will be
prepared in accordance with generally accepted accounting principles
consistently applied and, with respect to previously delivered statements and
information, there has been no material adverse change in the financial or
business condition of us or Dealer since the submission to you, either as of the
date of delivery, or if different, the date specified therein, and we
acknowledge your reliance thereon. This Guaranty will survive any federal and/or
state bankruptcy or insolvency action involving Dealer. We are solvent and our
execution of this Guaranty will not make us insolvent. If you are required in
any action involving Dealer to return or rescind any payment made to or value
received by you from or for the account of Dealer, this Guaranty will remain in
full force and effect and will be automatically reinstated without any further
action by you and notwithstanding any termination of this Guaranty or your
release of us. Any delay or failure by you, or your successors or assigns, in
exercising any of your rights or remedies hereunder will not waive any such
rights or remedies. Oral agreements or commitments to loan money, extend credit
or to forbear from enforcing repayment of a debt including promises to extend or
renew such debt are not enforceable. To protect us and you from misunderstanding
or disappointment, any agreements we reach covering such matters are contained
in this writing, which is the complete and exclusive statement of the agreement
between us, except as specifically provided herein or as we may later agree in
writing to modify it. Notwithstanding anything herein to the contrary: (a) you
may rely on any facsimile copy, electronic data transmission or electronic data
storage of this Guaranty, any agreement between you and Dealer, any Statement of
Transaction, billing statement, invoice from a vendor, financial statements or
other report, and (b) such facsimile copy, electronic data transmission or
electronic data storage will be deemed an original, and the best evidence
thereof for all purposes, including, without limitation, under this Guaranty or
any other agreement between you and us, and for all evidentiary purposes before
any arbitrator, court or other adjudicatory authority. We may terminate this
Guaranty by a written notice to you, the termination to be effective sixty (60)
days after you receive and acknowledge it, but the termination will not
terminate our obligations hereunder for Liabilities arising prior to the
effective termination date. We have read and understood all terms and provisions
of this Guaranty. We acknowledge receipt of a true copy of this Guaranty and of
all agreements between you and Dealer. The meanings of all terms herein are
equally applicable to both the singular and plural forms of such terms.
BINDING ARBITRATION. Except as otherwise specified below, all actions,
disputes, claims and controversies under common law, statutory law or in equity
of any type or nature whatsoever (including, without limitation, all torts,
whether regarding negligence, breach of fiduciary duty, restraint of trade,
fraud, conversion, duress, interference, wrongful replevin, wrongful
sequestration, fraud in the inducement, usury or any other tort, all contract
actions, whether regarding express or implied terms, such as implied covenants
of good faith, fair dealing, and the commercial reasonableness of any collateral
disposition, or any other contract claim, all claims of deceptive trade
practices or lender liability, and all claims questioning the reasonableness or
lawfulness of any act), whether arising before or after the date of this
Guaranty, and whether directly or indirectly relating to: (a) this Guaranty
and/or any amendments and addenda hereto, or the breach, invalidity or
termination hereof; (b) any previous or subsequent agreement between you and us;
(c) any act committed by you or by any parent company, subsidiary or affiliated
company of you (the "DFS Companies"), or by an employee, agent, officer or
director of a DFS Company, whether or not arising within the scope and course of
employment or other contractual representation of the DFS Companies provided
that such act arises under a relationship, transaction or dealing between you
and Dealer or you and us; and/or (d) any other relationship, transaction,
dealing or agreement between you and Dealer or you and us (collectively the
"Disputes"), will be subject to and resolved by binding arbitration.
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All arbitration hereunder will be conducted in accordance with The
Commercial Arbitration Rules of The American Arbitration Association ("AAA"). If
the AAA is dissolved, disbanded or becomes subject to any state or federal
bankruptcy or insolvency proceeding, the parties will remain subject to binding
arbitration which will be conducted by a mutually agreeable arbitral forum. The
parties agree that all arbitrator(s) selected will be attorneys with at least
five (5) years secured transactions experience. The arbitrator(s) will decide if
any inconsistency exists between the rules of any applicable arbitral forum and
the arbitration provisions contained herein. If such inconsistency exists, the
arbitration provisions contained herein will control and supersede such rules.
The site of all arbitrations will be in the Division of the Federal Judicial
District in which AAA maintains a regional office that is closest to Dealer.
Discovery permitted in any arbitration proceeding commenced hereunder is
limited as follows: No later than thirty (30) days after the filing of a claim
for arbitration, the parties will exchange detailed statements setting forth the
facts supporting the claim(s) and all defenses to be raised during the
arbitration, and a list of all exhibits and witnesses. No later than twenty-one
(21) days prior to the arbitration hearing, the parties will exchange a final
list of all exhibits and all witnesses, including any designation of any expert
witness(es) together with a summary of their testimony; a copy of all documents
and a detailed description of any property to be introduced at the hearing.
Under no circumstances will the use of interrogatories, requests for admission,
requests for the production of documents or the taking of depositions be
permitted. However, in the event of the designation of any expert witness(es),
the following will occur: (a) all information and documents relied upon by the
expert witness(es) will be delivered to the opposing party, (b) the opposing
party will be permitted to depose the expert witness(es), (c) the opposing party
will be permitted to designate rebuttal expert witness(es), and (d) the
arbitration hearing will be continued to the earliest possible date that enables
the foregoing limited discovery to be accomplished.
The Arbitrator(s) will not have the authority to award exemplary or
punitive damages.
All arbitration proceedings, including testimony or evidence at hearings,
will be kept confidential, although any award or order rendered by the
arbitrator(s) pursuant to the terms of this Guaranty may be entered as a
judgment or order in any state or federal court and may be entered as a judgment
or order within the federal judicial district which includes the residence of
the party against whom such award or order was entered. This Guaranty concerns
transactions involving commerce among the several states. The Federal
Arbitration Act ("FAA") will govern all arbitration(s) and confirmation
proceedings hereunder.
Nothing herein will be construed to prevent your or our use of bankruptcy,
receivership, injunction, repossession, replevin, claim and delivery,
sequestration, seizure, attachment, foreclosure, dation and/or any other
prejudgment or provisional action or remedy relating to any collateral for any
current or future debt owed by either party to the other. Any such action or
remedy will not waive your or our right to compel arbitration of any Dispute.
If either we or you bring any other action for judicial relief with respect
to any Dispute (other than those set forth in the immediately preceding
paragraph), the party bringing such action will be liable for and immediately
pay all of the other party's costs and expenses (including attorneys' fees)
incurred to stay or dismiss such action and remove or refer such Dispute to
arbitration. If either we or you bring or appeal an action to vacate or modify
an arbitration award and such party does not prevail, such party will pay all
costs and expenses, including attorneys' fees, incurred by the other party in
defending such action. Additionally, if we sue you or institute any arbitration
claim or counterclaim against you in which you are the prevailing party, we will
pay all costs and expenses (including attorneys' fees) incurred by you in the
course of defending such action or proceeding.
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Any arbitration proceeding must be instituted: (a) with respect to any
Dispute for the collection of any debt owed by either party to the other, within
two (2) years after the date the last payment was received by the instituting
party; and (b) with respect to any other Dispute, within two (2) years after the
date the incident giving rise thereto occurred, whether or not any damage was
sustained or capable of ascertainment or either party knew of such incident.
Failure to institute an arbitration proceeding within such period will
constitute an absolute bar and waiver to the institution of any proceeding with
respect to such Dispute. Except as otherwise stated herein, all notices,
arbitration claims, responses, requests and documents will be sufficiently given
or served if mailed or delivered: (i) to us at our address below; (ii) to you at
655 Maryville Centre Drive, St. Louis, Missouri 63141-5832, Attention: General
Counsel; or such other address as the parties may specify from time to time in
writing.
The agreement to arbitrate will survive the termination of this Guaranty.
IF THIS GUARANTY IS FOUND TO BE NOT SUBJECT TO ARBITRATION, ANY LEGAL
PROCEEDING WITH RESPECT TO ANY DISPUTE WILL BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE WITHOUT A JURY. WE WAIVE ANY RIGHT TO A JURY TRIAL IN
ANY SUCH PROCEEDING.
We acknowledge and agree that this Guaranty and all agreements between
Dealer and you have been substantially negotiated, and will be performed, in the
state of Missouri. Accordingly, we agree that all Disputes will be governed by,
and construed in accordance with, the laws of such state, except to the extent
inconsistent with the provisions of the FAA which will control and govern all
arbitration proceedings hereunder.
THIS GUARANTY CONTAINS BINDING ARBITRATION, JURY WAIVER AND PUNITIVE DAMAGES
WAIVER PROVISIONS.
Date: ____________, 2001
ePLUS, inc.
By: ___________________________
Bruce M. Bowen
Executive Vice President
[ Address of Guarantor:
400 Herndon Parkway
Herndon, VA 20170
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SECRETARY'S CERTIFICATE
I hereby certify that I am the Secretary or Assistant Secretary of ePLUS, inc.
("Guarantor") and that execution of the above Limited Guaranty was ratified,
approved and confirmed by the Shareholders at a meeting, if necessary, and
pursuant to a resolution of the Board of Directors of Guarantor at a meeting of
the Board of Directors duly called, and which is currently in effect, which
resolution was duly presented, seconded and adopted and reads as follows:
"BE IT RESOLVED that any officer of this corporation is hereby authorized
to execute a guaranty of the obligations of ePlus Technology of PA, inc.
("Dealer") to Deutsche Financial Services Corporation on behalf of the
corporation, which instrument may contain such terms as the above named persons
may see fit including, but not limited to a waiver of notice of the acceptance
of the guaranty; presentment; demand; protest; notices of nonpayment,
nonperformance, dishonor, the amount of indebtedness of Dealer outstanding at
any time, any legal proceedings against Dealer, and any other demands and
notices required by law; and any right of contribution from other guarantors."
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
corporate seal on this ____ day of ____________, 2001.
(SEAL) (Assistant)Secretary:
ePLUS, inc.