- 6 -
FOURTH AMENDMENT TO LOAN AGREEMENT
THIS FOURTH AMENDMENT ("Amendment") made as of this 30th day of July, 2002 among
MANCHESTER TECHNOLOGIES, INC., formerly known as Manchester Equipment Co., Inc.
a New York corporation having its principal place of business at 160 Oser
Avenue, Hauppauge, New York 11788 (the "Borrower"), MANCHESTER INTERNATIONAL
LTD., a New York corporation having its principal place of business at 160 Oser
Avenue, Hauppauge, New York 11788 ("International" or a "Guarantor"), MANTECH
COMPUTER SERVICES, INC., a New York corporation having its principal place of
business at 160 Oser Avenue, Hauppauge, New York 11788 ("ManTech" or a
"Guarantor"), MEC LEASING GROUP, LTD., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788 ("MEC"
or a "Guarantor"), MANCHESTER SOLUTIONS, INC., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788
("Solutions" or a "Guarantor"), ELECTROGRAPH SYSTEMS, INC., a New York
corporation having its principal place of business at 40 Marcus Boulevard,
Hauppauge, New York 11788 ("Electrograph" or a "Guarantor"), COASTAL OFFICE
PRODUCTS, INC., a Maryland corporation having its principal place of business at
160 Oser Avenue, Hauppauge, New York 11788 ("Coastal" or a "Guarantor"), MEC
SUPPORT SERVICES, INC., a New York corporation having its principal place of
business at 160 Oser Avenue, Hauppauge, New York 11788 ("MSS" or a "Guarantor"),
CLOSE OUTS 4U.COM, INC., a New York corporation having its principal place of
business at 160 Oser Avenue, Hauppauge, New York 11788 ("Close Outs" or a
"Guarantor"), MEC INTERNET SERVICES, INC., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788 ("MEC"
or a "Guarantor"), 47 COMPUTERS.COM, INC., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788 ("47
Computers" or a "Guarantor"), 4U.COM, INC., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788 ("4U"
or a "Guarantor"), ALMOST NEW 4U.COM, INC., a New York corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788
("Almost New" or a "Guarantor"), ODD LOTS 4U.COM, INC., a New York corporation
having its principal place of business at 160 Oser Avenue, Hauppauge, New York
11788 ("Odd Lots" or a "Guarantor") TEXPORT TECHNOLOGY GROUP, INC., a New York
corporation having its principal place of business at 160 Oser Avenue,
Hauppauge, New York 11788 ("Texport" or a "Guarantor"), MARKETPLACE 4U.COM,
- 1 -
INC., a New York corporation having its principal place of business at 160 Oser
Avenue, Hauppauge, New York 11788 ("Marketplace" or a "Guarantor"), LEARNING
TECHNOLOGY GROUP, LLC, a New York limited liability company having its principal
place of business at 160 Oser Avenue, Hauppauge, New York 11788 ("Learning" or a
"Guarantor"), DONOVAN CONSULTING GROUP, INC., a Delaware corporation having its
principal place of business at 510 Swanson Road, Tyrone, Georgia 30290
("Donovan" or a "Guarantor") and e.TRACK SOLUTIONS, INC., a New York corporation
with its principal place of business at 160 Oser Avenue, Hauppauge, New York
11788 ("e.track" or a "Guarantor") and CITIBANK, N.A., successor to European
American Bank, having an office at 730 Veterans Memorial Highway, Hauppauge, New
York 11788 ("Citibank" or a "Bank") and CITIBANK, N.A., successor to European
American Bank, as agent for the Banks (the "Agent").
W I T N E S S E T H :
WHEREAS, the Borrower, the Guarantors, the Agent and the Banks entered into
a Loan Agreement dated as of the 25th day of June, 1999, which Loan Agreement
has heretofore been amended pursuant to that certain First Amendment dated as of
August 14, 2000, that certain Second Amendment dated as of March 27, 2001 and
that certain Third Amendment dated as of October 10, 2001 (as so amended, the
"Agreement"); and
WHEREAS, the Banks have made loans to the Borrower as evidenced by certain
notes of the Borrower and specifying interest to be paid thereon; and
WHEREAS, the Borrower has formed e.track as a subsidiary of the Borrower;
and
WHEREAS, e.track is required pursuant to the terms of the Agreement to
become a party to the Agreement and to guaranty all of the Borrower's
obligations thereunder; and
WHEREAS the Borrower and the Guarantors have requested that the Agent and
the Banks agree to:
(i) increase the permitted stock repurchase amount to the aggregate sum of
$3,500,000.00; and
(ii) increase permitted annual Consolidated Capital Expenditures to
$3,000,000.00.
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Guarantors, the Agent and the Banks do hereby
agree as follows:
- 2 -
1. Defined Terms. As used in this Amendment, capitalized terms, unless
otherwise defined, shall have the meanings set forth in the Agreement.
2. Representations and Warranties. As an inducement for the Agent and the
Banks to enter into this Amendment, the Borrower and each Guarantor represents
and warrants as follows:
A. That with respect to the Agreement and the Loan Documents executed in
connection therewith and herewith:
(i) There are no defenses or offsets to the Borrower's or any
Guarantor's obligations under the Agreement as amended hereby, the Notes or
any of the Loan Documents or any other agreements in favor of the Banks
referred to in the Agreement, and if any such defenses or offsets exist
without the knowledge of the Borrower or any Guarantor, the same are hereby
waived.
(ii) All of the representations and warranties made by the Borrower
and any Guarantor in the Agreement as amended hereby are true and correct
in all material respects as if made on the date hereof, except for those
made with respect to a particular date, which such representations and
warranties are restated as of such date; and provided further that the
representations and warranties set forth in Section 4.01(f) of the
Agreement shall relate to the consolidated financial statements of the
Borrower and its Consolidated Affiliates for the fiscal year ended July 31,
2001 and the 9 month fiscal period ended April 30, 2002.
(iii) As of the date hereof, there are no Loans outstanding.
3. e.track. By the execution of this Amendment, e.track agrees that it
shall be a party to the Agreement, as amended hereby.
4. Amendments. The following amendments are hereby made to the Agreement:
(a) Section 5.02(o) is hereby amended to read as follows:
"(o) Dividends, Etc. Declare or pay any dividends, purchase, redeem, retire
or otherwise acquire for value any of its capital stock now or hereafter
outstanding, or make any distribution of assets to its stockholders as
such, whether in cash, assets, or in obligations of the Borrower or any
Guarantor; or allocate or otherwise set apart any sum for the payment of
- 3 -
any dividend or distribution on, or for the purchase, redemption or
retirement of any shares of its capital stock; or make any other
distribution by reduction of capital or otherwise in respect of any share
of its capital stock; provided, however, that as long as no Default or
Event of Default then exists or would result therefrom, the Borrower may
repurchase, during the term of this Agreement, not more than $3,500,000.00
of its outstanding common stock in open market transactions."
(b) Section 5.03(b) is hereby amended to read as follows:
"(b) Consolidated Capital Expenditures. The Borrower, the Guarantors and
their respective Subsidiaries will not make Consolidated Capital
Expenditures (exclusive of amounts allocated to capital assets acquired
pursuant to a Permitted Acquisition) in excess of $3,000,000.00 in the
aggregate during any fiscal year."
5. Effectiveness. This Amendment shall become effective upon the occurrence
of the following events and the receipt and satisfactory review by the Agent and
its counsel of the following documents:
(a) The Agent shall have received this Amendment, duly executed by the
Borrower and each Guarantor.
(b) The Agent shall have received copies of any and all modifications of
the documentation referred to in Section 3.01 of the Agreement which could
result in a Material Adverse Change.
(c) The Agent shall have received an amendment fee in the amount of
$1,500.00.
(d) The Agent's counsel shall have been paid their fees and disbursements
in the amount of $1,000.00 in connection with this Amendment.
(e) The Agent shall have received from e.track an executed Guaranty.
(f) The Agent shall have received from e.track certified (as of the date of
this Amendment) copies of the resolutions of the Boards of Directors and the
shareholders of e.track, authorizing and approving the Agreement as amended
hereby, its Guaranty and any other Loan Document applicable to it, and the
execution, delivery and performance thereof and certified copies of all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to the Agreement as amended hereby, its Guaranty
and the other Loan Documents.
- 4 -
(g) The Agent shall have received from e.track a certificate of the
Secretary (attested to by another officer) of e.track certifying (i) the names
and true signatures of the officer or officers of e.track authorized to sign the
Agreement as amended hereby, its Guaranty and any other Loan Documents to be
delivered hereunder on behalf of e.track; (ii) a copy of e.track's by-laws as
complete and correct on the date of this Agreement; and (iii) the stock
ownership of e.track.
(h) The Agent shall have received from e.track a true and complete copy of
its certificate of incorporation and all amendments thereto and a certificate of
existence and good standing with respect to e.track from the Secretary of State
(or equivalent officer) of the state of incorporation of e.track and from the
Secretary of State (or equivalent officer) of any state in which e.track is
authorized to do business.
6. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York.
7. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
8. Ratification. Except as hereby amended, the Agreement and all other Loan
Documents executed in connection therewith shall remain in full force and effect
in accordance with their originally stated terms and conditions. The Agreement
and all other Loan Documents executed in connection therewith, as amended
hereby, are in all respects ratified and confirmed.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
- 5 -
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the year and date first above written.
CITIBANK, N.A., as Agent
By: S/ Stuart N. Berman
--------------------
Name: Stuart N. Berman
Title: Vice President
CITIBANK, N.A.
By: S/ Stuart N. Berman
-------------------
Name: Stuart N. Berman
Title: Vice President
MANCHESTER TECHNOLOGIES, INC.
By: S/ Barry R. Steinberg
---------------------
Name: Barry R. Steinberg
Title: Chief Executive Officer
EACH OF THE GUARANTORS LISTED ON
SCHEDULE A HERETO
By: S/ Barry R. Steinberg
---------------------
Name: Barry R. Steinberg
Title: Chief Executive Officer
LEARNING TECHNOLOGY
GROUP, LLC
By: MANCHESTER TECHNOLOGIES, INC., Member
By: S/ Barry R. Steinberg
---------------------
Name: Barry R. Steinberg
Title: Chief Executive Officer
- 6 -
SCHEDULE A
MANCHESTER INTERNATIONAL LTD.
MANTECH COMPUTER SERVICES, INC.
MEC LEASING GROUP, LTD.
MANCHESTER SOLUTIONS, INC.
ELECTROGRAPH SYSTEMS, INC.
COASTAL OFFICE PRODUCTS, INC.
MEC SUPPORT SERVICES, INC.
CLOSE OUTS 4U.COM, INC.
MEC INTERNET SERVICES, INC.
47 COMPUTERS.COM, INC.
4U.COM, INC.
ALMOST NEW 4U.COM, INC.
ODD LOTS 4U.COM, INC.
MARKETPLACE 4U.COM, INC.
TEXPORT TECHNOLOGY GROUP, INC.
DONOVAN CONSULTING GROUP, INC.
E.TRACK SOLUTIONS, INC.
- 7 -
- 12 -
GENERAL GUARANTEE
(Corporation)
Garden City, New York as of July 30, 2002
FOR VALUE RECEIVED, and in consideration of loans made or to be made or
credit otherwise extended or to be extended by CITIBANK, N.A., successor to
European American Bank ("Citibank") (Citibank being a "Bank" and the term
"Banks" also referring to one or more other Persons which may become lenders
under the Loan Agreement described below) and in further consideration of any
loans or other credit to be extended by Citibank in its capacity as the Agent
under the Loan Agreement described below (the "Agent"), to or for the account of
E.TRACK SOLUTIONS, INC. (the "Borrower") from time to time and at any time and
for other good and valuable consideration and to induce the Banks, in their
discretion, to make or commit to make such loans or extensions of credit,
including, but not limited to, the Loans, as defined in the Loan Agreement (the
"Extensions of Credit"), and to make or grant such renewals, extensions,
releases of collateral or relinquishments of legal rights as to the Agent or the
Banks may seem advisable, each of MANCHESTER TECHNOLOGIES, INC., a New York
corporation having its principal place of business at 160 Oser Avenue,
Hauppauge, New York 11788, MANCHESTER INTERNATIONAL LTD., a New York corporation
having its principal place of business at 160 Oser Avenue, Hauppauge, New York
11788, MEC LEASING GROUP, LTD., a New York corporation having its principal
place of business at 160 Oser Avenue, Hauppauge, New York, MANCHESTER SOLUTIONS,
INC., a New York corporation having its principal place of business at 160 Oser
Avenue, Hauppauge, New York, ELECTROGRAPH SYSTEMS, INC., a New York corporation
having its principal place of business at 40 Marcus Blvd., Hauppauge, New York
11788, COASTAL OFFICE PRODUCTS, INC., a Maryland corporation having its
principal place of business at 160 Oser Avenue, Hauppauge, New York 11788, MEC
SUPPORT SERVICES, INC., a New York corporation having its principal place of
business at 160 Oser Avenue, Hauppauge, New York 11788, CLOSE OUTS 4U.COM, INC.,
a New York corporation having its principal place of business at 160 Oser
Avenue, Hauppauge, New York 11788, MEC INTERNET SERVICES, INC., a New York
corporation having its principal place of business at 160 Oser Avenue,
Hauppauge, New York 11788, 47 COMPUTERS.COM, INC., a New York corporation having
its principal place of business at 160 Oser Avenue, Hauppauge, New York 11788,
MARKETPLACE 4U.COM, INC., a New York corporation having its principal place of
- 1-
business at 160 Oser Avenue, Hauppauge, New York 11788, 4U.COM, INC., a New York
corporation having its principal place of business at 160 Oser Avenue,
Hauppauge, New York 11788, ALMOST NEW 4U.COM, INC., a New York corporation
having its principal place of business at 160 Oser Avenue, Hauppauge, New York
11788, ODD LOTS 4U.COM, INC., a New York corporation having its principal place
of business at 160 Oser Avenue, Hauppauge, New York 11788, TEXPORT TECHNOLOGY
GROUP, INC., a New York corporation having its principal place of business at
160 Oser Avenue, Hauppauge, New York 11788, DONOVAN CONSULTING GROUP, INC., a
Delaware corporation having its principal place of business at 510 Swanson Road,
Tyrone, Georgia 30290 and LEARNING TECHNOLOGY GROUP, LLC, a New York limited
liability company having its principal place of business at 160 Oser Avenue,
Hauppauge, New York 11788 (hereinafter jointly and severally referred to as the
"Guarantor"), absolutely and unconditionally guarantees to the Banks and the
Agent, their respective successors, endorsees and assigns, the prompt and
complete payment when due, whether by acceleration or otherwise, of all present
or future obligations and liabilities of any and all kinds of the Borrower to
any of the Banks or the Agent and of all instruments of any nature evidencing or
relating to any such obligations and liabilities upon which the Borrower or one
or more parties and the Borrower is or may become liable to any of the Banks or
the Agent, whether incurred by the Borrower as maker, indorser, drawer,
acceptor, guarantor, accommodation party, counterparty, purchaser, seller or
otherwise, and whether due or to become due, secured or unsecured, absolute or
contingent, joint and/or several, and howsoever or whenever acquired by any of
the Banks or the Agent and whether incurred pursuant to or in connection with
that certain Loan Agreement dated as of June 25, 1999 among the Agent, the
Banks, the Borrower, the Guarantor and others, which Loan Agreement has
heretofore been amended pursuant to that certain First Amendment dated as of
August 14, 2000, that certain Second Amendment dated as of March 27, 2001, that
certain Third Amendment dated as of October 10, 2001 and that certain Fourth
Amendment of even date herewith (as so amended and as may be further amended
from time to time, the "Loan Agreement") (all of which are herein collectively
referred to as the "Obligations"), whether due or to become due, and
irrespective of the genuineness, validity, regularity, discharge, release 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
- 2 -
collateral or of the obligation of the Guarantor under this Guaranty. The
Obligations shall include interest accruing thereon before or after the
commencement of any insolvency, bankruptcy or reorganization proceeding in
respect of the Borrower or any other guarantor of the Obligations whether or not
such interest is an allowable claim in any such proceeding and irrespective of
the discharge or release of the Borrower or any other guarantor in such
proceeding. Capitalized terms used herein without definition shall have the
meanings given such terms in the Loan Agreement.
1. The Guarantor hereby agrees that the Agent may enforce the provisions of
this Guaranty for itself and/or on behalf of the Banks. The Guarantor hereby
further agrees that the Agent or any of the Banks may at any time and from time
to time, either before or after the maturity thereof, without notice to or
reservation of rights against or further consent of the Guarantor (i) extend the
time of payment of, change the amount of, exchange, release, substitute or
surrender any collateral for, renew or extend any of the Obligations or increase
the interest rate thereon or (ii) make any agreement with the Borrower or with
any other guarantor of the Obligations or any other party to or person liable on
any of the Obligations, or interested therein, or with any hypothecator of
collateral for the Obligations, 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 the Agent and/or any of the Banks
and the Borrower or any such other party or person. The Guarantor agrees that
this Guaranty shall not be impaired or otherwise affected by any failure to call
for, take, hold, protect or perfect, continue the perfection of or enforce any
security interest in or other lien upon, any collateral for the Obligations, or
by any failure to exercise, delay in the exercising or waiver of, or
forebearance with respect to, any right or remedy available to the Agent with
respect to the Obligations. Any of the foregoing shall not in any way impair or
affect this Guaranty or the obligation of the Guarantor hereunder.
2. The Guarantor hereby acknowledges that it has derived or expects to
derive a financial or other benefit from each and every Obligation incurred by
the Borrower to the Agent or any of the Banks reasonably equivalent to the
obligation of the Guarantor hereunder.
- 3 -
3. The Guarantor waives notice of the acceptance of this Guaranty and of
the making of any such loans or extensions of credit or the incurrence of any
Obligation, presentment to or demand of payment from anyone whomsoever liable
upon any of the Obligations, protest, notice of presentment, non-payment or
protest and notice of any sale or other disposition of collateral security or
any default of any sort.
4. To secure the liabilities of the Guarantor under this Guaranty, the
Guarantor hereby grants to the Agent and each of the Banks a security interest
in and a lien upon all personal property of the Guarantor or in which the
Guarantor may have an interest which is now or may at any time hereafter come
into the possession or control of the Agent or any of the Banks, (including
property held by the Agent or any of the Banks in a fiduciary capacity) or of
any third party acting on their behalf (the "Collateral"), whether for the
express purpose of being used by the Agent or any of the Banks as collateral
security or for safekeeping or for any other or different purpose, including
such personal property as may be in transit by mail or carrier for any purpose
or covered or affected by any documents in the Agent's or any Bank's possession
or control, or in the possession or control of any third party acting on behalf
of the Agent or any of the Banks, or any collateral which secures any other
obligations of the Guarantor to the Agent or any of the Banks. The Guarantor
hereby authorizes the Agent or any of the Banks in their discretion, at any
time, to appropriate and apply upon any of their liabilities of the Guarantor
under this Guaranty any such property of the Guarantor and to charge any of such
liabilities against any balance of any account standing to the credit of the
Guarantor on the books of the Agent or any of the Banks. To satisfy the
liabilities of the Guarantor under this Guaranty, the Agent and the Banks shall
have, in addition to all other rights and remedies allowed by law, the rights
and remedies of a secured party under the Uniform Commercial Code as in effect
in the State of New York at the date hereof and, without limiting the generality
of the foregoing, the Agent or any Bank may immediately, without demand of
performance and without notice of intention to sell or otherwise to dispose of
or of the time or place of sale or of redemption or other notice or demand
whatsoever to the Guarantor, all of which are hereby expressly waived, to the
extent permitted by law, and without advertisement, sell at public or private
sale, grant options to purchase or otherwise realize upon, in the State of New
York, or elsewhere, the whole or from time to time any part of the said
- 4 -
Collateral upon which the Agent or such Bank shall have a security interest and
lien as aforesaid, and after deducting from the proceeds of sale or other
disposition of the said Collateral all expenses (including all reasonable
expenses for legal services of every kind and other expenses as set forth below)
shall apply the residue of such proceeds towards the payment of any of the
liabilities of the Guarantor under this Guaranty in such order as the Agent or
such Bank shall elect, the Guarantor remaining liable for any deficiency
remaining unpaid after such application. If notice of any sale or other
disposition is required by law to be given, the Guarantor hereby agrees that a
notice sent at least five (5) days before the time of any intended public sale
or of the time after which any private sale or other disposition of the said
Collateral is to be made, shall be reasonable notice of such sale or other
disposition.
5. At any such sale or other disposition of said Collateral the Agent or
any of the Banks or any person designated by the Agent or any of the Banks may
itself purchase the whole or any part of the Collateral sold or otherwise
disposed of, free from any right of redemption on the part of the Guarantor,
which right, to the extent permitted by law, is hereby waived and released.
6. The Guarantor agrees that the aforementioned Collateral secures, and
further agrees to pay on demand, all expenses (including reasonable expenses for
legal services, whether or not litigation is commenced and cost of any insurance
and payment of taxes or other charges) of, or incidental to, the custody, care,
sale or collection of, or realization upon, any of the said Collateral or in any
way relating to the enforcement or protection of the rights of the Agent or any
of the Banks hereunder or under or with respect to any of the Obligations.
7. This is a continuing Guaranty and shall remain in full force and effect
and shall apply to all Obligations notwithstanding that at any particular time
any or all of the Obligations shall have been paid in full. No attempted
revocation shall release the Guarantor or affect in any manner the rights,
remedies, powers, security interests and liens of the Agent or any of the Banks
under this Guaranty with respect to any of the Obligations. If any of the
present or future Obligations are guaranteed by persons, partnerships, limited
liability companies or corporations in addition to the Guarantor, the death,
- 5 -
release or discharge in whole or in part, or the bankruptcy, liquidation or
dissolution of one or more of them, shall not discharge or affect the
liabilities of the Guarantor under this Guaranty.
8. This Guaranty shall continue to be effective, or be reinstated, as the
case may be, if at any time any payment, or any part thereof, of any of the
Obligations is rescinded or must otherwise be restored or returned by the Agent
or any of the Banks upon insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Borrower or the Guarantor, or otherwise, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or the Guarantor or any substantial
part of their property, or otherwise, all as though such payments had not been
made.
9. This Guaranty is a guaranty of payment and not of collection, and
neither the Agent nor any of the Banks shall be under an obligation to take any
action against the Borrower or any other person liable with respect to any of
the Obligations or resort to any collateral security held by any of them to
secure any of the Obligations as a condition precedent to the Guarantor being
obligated to make payment and to perform as agreed herein. The Guarantor hereby
waives any rights to interpose any defense, counterclaim or offset of any nature
and description which it may have or which may exist between and among the Agent
or any of the Banks, the Borrower and/or the Guarantor. Neither the Agent, the
Banks nor their respective successors, endorsees or assigns shall have any
obligation to protect, secure, perfect or insure any lien at any time held by
any of them as security for the Obligations or for this Guaranty or any property
subject thereto or hereto, but at the Agent's or such Bank's sole option and
without prejudice may do so or incompletely do so, and the Guarantor's
obligations hereunder shall in no way be affected by reason thereof. This
Guaranty may be assigned by the Agent and its benefits shall inure to the
successors, indorsees and assigns of the Agent.
10. THE GUARANTOR, THE AGENT AND THE BANKS HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE ANY RIGHT TO TRIAL BY JURY WHICH THE GUARANTOR, THE
AGENT AND THE BANKS MAY HAVE IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM,
AT LAW OR IN EQUITY, IN CONNECTION WITH THIS GUARANTY OR THE TRANSACTIONS
RELATED HERETO. THE GUARANTOR REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE OR
- 6 -
AGENT OF THE AGENT OR ANY OF THE BANKS HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT THE AGENT OR ANY OF THE BANKS WILL NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THIS JURY TRIAL WAIVER. THE GUARANTOR ACKNOWLEDGES THAT THE AGENT AND
THE BANKS HAVE BEEN INDUCED TO ACCEPT THIS GUARANTY BY, AMONG OTHER THINGS, THE
PROVISIONS OF THIS SECTION.
11. Until such time as the Obligations have been indefeasibly paid in full,
the Guarantor hereby waives all rights to be subrogated to the rights of the
Agent or any of the Banks with respect to the Obligations. In addition, the
Guarantor hereby waives, until such time as the Obligations have been
indefeasibly paid in full, any right to proceed against the Borrower, now or
hereafter, for contribution, indemnity, reimbursement and all other suretyship
rights and claims, whether direct or indirect, liquidated or contingent, whether
arising under express or implied contract or by operation of law, which the
Guarantor may now or hereafter have against the Borrower with respect to the
Obligations and the Guarantor agrees that it will not take any such action
against the Borrower or against any other person seeking contribution,
reimbursement or indemnification by the Borrower or such other person with
respect to the Obligations. The Guarantor also hereby waives, until such time as
the Obligations have been indefeasibly paid in full, any rights to recourse to
or with respect to any assets of the Borrower. The Guarantor agrees that in
light of the waivers contained in this Paragraph 11, the execution of this
Guaranty shall not be deemed to make the Guarantor a creditor of the Borrower,
and that for the purposes of Sections 547 and 550 of the United States
Bankruptcy Code (11 U.S.C. Sec. 547, 550), the Guarantor shall not be deemed a
creditor of the Borrower. If any amount shall be paid to the Guarantor on
account of such subrogation rights at any time when all such Obligations shall
not have been indefeasibly paid in full, such amount shall be held in trust for
the benefit of the Agent and the Banks and shall forthwith be paid to the Agent
to be credited and applied upon the Obligations.
12. The Guarantor authorizes the Agent to date this Guaranty and to
complete any blank space herein according to the terms upon which this Guaranty
was given. Any notice to any party hereto shall be given as provided for in the
Loan Agreement.
13. No failure on the part of the Agent or any of the Banks to exercise,
- 7 -
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 the Agent or
any of the Banks of any right, remedy or power hereunder preclude any other or
future exercise of any other right, remedy or power.
14. Each and every right, remedy and power hereby granted to the Agent or
any of the Banks or allowed them by law or other agreement shall be cumulative
and not exclusive of any other right, remedy and power, and may be exercised by
the Agent or any of the Banks at any time and from time to time.
15. This Guaranty embodies the entire agreement and understanding between
the Agent, the Banks and the Guarantor and supersedes all prior agreements and
understandings relating to the subject matter hereof. This Guaranty may not be
amended, and compliance with its terms may not be waived, orally or by course of
dealing, but only by a writing signed by an authorized officer of the Agent.
16. This Guaranty shall be construed and interpreted and all rights and
obligations hereunder shall be determined, in accordance with the laws of the
State of New York, without regard to principles of conflict of laws. The
Guarantor agrees that any action or proceeding relating in any way to this
Guaranty shall be brought and enforced in the courts of the State of New York or
the United States District Court for the Southern or Eastern District of New
York, and irrevocably submits to the jurisdiction of each such court in any
action or proceeding arising out of or relating to this Guaranty, and the
Guarantor irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such New York State or Federal Court.
In furtherance of the foregoing, the Guarantor hereby irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of venue in any action or proceeding relating in any way to
this Guaranty brought in the Supreme Court of the State of New York within
Nassau and Suffolk Counties or the United States District Court for the Eastern
District of New York and any claim that such action or proceeding brought in any
such court has been brought in an inconvenient forum. Notwithstanding the
foregoing, the Agent or any of the Banks may bring any action or proceeding
against the Guarantor or its property in the courts of such jurisdictions as are
deemed necessary by the Agent or any of the Banks in its sole and absolute
- 8 -
discretion. The Guarantor agrees to pay all costs and expenses incurred by the
Agent or any of the Banks incidental to or in any way relating to the
enforcement of the Obligations or the obligations of or the protection of the
rights of the Agent or any of the Banks hereunder, including, but not limited
to, reasonable attorneys' fees and expenses, whether or not litigation is
commenced.
17. This Guaranty shall remain in full force and effect until there is
indefeasible cash payment of the Obligations in full and the Total Commitment
and each of the Commitments of the Banks have terminated. No payment or payments
made by any person or received or collected by the Agent or any of the Banks
from any person by virtue of any action or proceeding or any setoff or
appropriation or application, at any time or from time to time, in reduction of
or in payment of the Obligations shall be deemed to modify, reduce, release or
otherwise affect the liability of the Guarantor hereunder which shall,
notwithstanding any such payment or payments, remain in place until there is
cash payment of the Obligations in full.
18. The Guarantor represents and warrants that all necessary and proper
corporate action has been taken to make this Guaranty and all of the provisions
hereof the valid and binding obligations of the Guarantor, enforceable against
the Guarantor in accordance with its terms.
19. Every provision of this Guaranty is intended to be severable and any
provision(s) of this Guaranty which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to extent of such
prohibition or enforceability without invalidating the remaining provisions
hereof, and any prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
20. None of the terms or provisions of this Guaranty may be waived,
amended, supplemented or otherwise modified except by a written instrument
executed by the Guarantor, the Agent and the Banks.
21. If this Guaranty is executed by two or more parties, they shall be
jointly and severally liable hereunder, and the word "Guarantor" wherever used
herein shall be construed to refer to each of such parties separately, all in
- 9 -
the same manner and with the same effect as if each of them had signed separate
instruments; and in any such case this Guaranty shall not be revoked or impaired
as to any one or more of such parties by the death or dissolution of any of the
others or by the revocation or release of any liabilities hereunder of any one
or more of such other parties and the Bank may proceed against none, one or more
of the Guarantors at one time, or from time to time, in its sole and absolute
discretion.
- 10 -
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
by its authorized officer as of this 30th day of July, 2002.
EACH OF THE GUARANTORS LISTED ON
SCHEDULE A HERETO
By: /S/ Barry R. Steinberg
---------------------
Name: Barry R. Steinberg
Title: Chief Executive Officer
LEARNING TECHNOLOGY GROUP, LLC
By: /S/ Barry R. Steinberg
------------------
Name: Barry R. Steinberg
Title: Member
- 11 -
SCHEDULE A
MANCHESTER TECHNOLOGIES, INC.
MANCHESTER INTERNATIONAL LTD.
ODD LOTS 4U.COM, INC.
MEC LEASING GROUP, LTD.
MANCHESTER SOLUTIONS, INC.
MANTECH COMPUTER SERVICES, INC.
ELECTROGRAPH SYSTEMS, INC.
COASTAL OFFICE PRODUCTS, INC.
MEC SUPPORT SERVICES, INC.
CLOSE OUTS 4U.COM, INC.
MEC INTERNET SERVICES, INC.
47 COMPUTERS.COM, INC.
MARKETPLACE 4U.COM, INC.
4U.COM, INC.
ALMOST NEW 4U.COM, INC.
TEXPORT TECHNOLOGY GROUP, INC.
DONOVAN CONSULTING GROUP, INC.
- 12 -
- 9 -
GENERAL GUARANTEE
(Corporation)
Garden City, New York as of July 30, 2002
FOR VALUE RECEIVED, and in consideration of loans made or to be made or
credit otherwise extended or to be extended by CITIBANK, N.A., successor to
European American Bank ("Citibank") (Citibank being a "Bank" and the term
"Banks" also referring to one or more other Persons which may become lenders
under the Loan Agreement described below) and in further consideration of any
loans or other credit to be extended by Citibank in its capacity as the Agent
under the Loan Agreement described below (the "Agent"), to or for the account of
each of the entities set forth in Schedule A hereto (collectively, the
"Borrower") from time to time and at any time and for other good and valuable
consideration and to induce the Banks, in their discretion, to make or commit to
make such loans or extensions of credit, including, but not limited to, the
Loans, as defined in the Loan Agreement (the "Extensions of Credit"), and to
make or grant such renewals, extensions, releases of collateral or
relinquishments of legal rights as to the Agent or the Banks may seem advisable,
e.TRACK SOLUTIONS, INC., a New York corporation with its principal place of
business at 160 Oser Avenue, Hauppauge, New York 11788 (hereinafter referred to
as the "Guarantor"), absolutely and unconditionally guarantees to the Banks and
the Agent, their respective successors, endorsees and assigns, the prompt and
complete payment when due, whether by acceleration or otherwise, of all present
or future obligations and liabilities of any and all kinds of the Borrower to
any of the Banks or the Agent and of all instruments of any nature evidencing or
relating to any such obligations and liabilities upon which the Borrower or one
or more parties and the Borrower is or may become liable to any of the Banks or
the Agent, whether incurred by the Borrower as maker, indorser, drawer,
acceptor, guarantor, accommodation party, counterparty, purchaser, seller or
otherwise, and whether due or to become due, secured or unsecured, absolute or
contingent, joint and/or several, and howsoever or whenever acquired by any of
the Banks or the Agent and whether incurred pursuant to or in connection with
that certain Loan Agreement dated as of June 25, 1999 among the Agent, the
Banks, the Borrower, the Guarantor and others, which Loan Agreement has
heretofore been amended pursuant to that certain First Amendment dated as of
August 14, 2000, that certain Second Amendment dated as of March 27, 2001, that
- 1 -
certain Third Amendment dated as of October 10, 2001 and that certain Fourth
Amendment of even date herewith (as so amended and as may be further amended
from time to time, the "Loan Agreement") (all of which are herein collectively
referred to as the "Obligations"), whether due or to become due, and
irrespective of the genuineness, validity, regularity, discharge, release 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 or of the obligation of the Guarantor under this Guaranty. The
Obligations shall include interest accruing thereon before or after the
commencement of any insolvency, bankruptcy or reorganization proceeding in
respect of the Borrower or any other guarantor of the Obligations whether or not
such interest is an allowable claim in any such proceeding and irrespective of
the discharge or release of the Borrower or any other guarantor in such
proceeding. Capitalized terms used herein without definition shall have the
meanings given such terms in the Loan Agreement.
1. The Guarantor hereby agrees that the Agent may enforce the provisions of
this Guaranty for itself and/or on behalf of the Banks. The Guarantor hereby
further agrees that the Agent or any of the Banks may at any time and from time
to time, either before or after the maturity thereof, without notice to or
reservation of rights against or further consent of the Guarantor (i) extend the
time of payment of, change the amount of, exchange, release, substitute or
surrender any collateral for, renew or extend any of the Obligations or increase
the interest rate thereon or (ii) make any agreement with the Borrower or with
any other guarantor of the Obligations or any other party to or person liable on
any of the Obligations, or interested therein, or with any hypothecator of
collateral for the Obligations, 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 the Agent and/or any of the Banks
and the Borrower or any such other party or person. The Guarantor agrees that
this Guaranty shall not be impaired or otherwise affected by any failure to call
for, take, hold, protect or perfect, continue the perfection of or enforce any
security interest in or other lien upon, any collateral for the Obligations, or
by any failure to exercise, delay in the exercising or waiver of, or
forebearance with respect to, any right or remedy available to the Agent with
- 2 -
respect to the Obligations. Any of the foregoing shall not in any way impair or
affect this Guaranty or the obligation of the Guarantor hereunder.
2. The Guarantor hereby acknowledges that it has derived or expects to
derive a financial or other benefit from each and every Obligation incurred by
the Borrower to the Agent or any of the Banks reasonably equivalent to the
obligation of the Guarantor hereunder.
3. The Guarantor waives notice of the acceptance of this Guaranty and of
the making of any such loans or extensions of credit or the incurrence of any
Obligation, presentment to or demand of payment from anyone whomsoever liable
upon any of the Obligations, protest, notice of presentment, non-payment or
protest and notice of any sale or other disposition of collateral security or
any default of any sort.
4. To secure the liabilities of the Guarantor under this Guaranty, the
Guarantor hereby grants to the Agent and each of the Banks a security interest
in and a lien upon all personal property of the Guarantor or in which the
Guarantor may have an interest which is now or may at any time hereafter come
into the possession or control of the Agent or any of the Banks, (including
property held by the Agent or any of the Banks in a fiduciary capacity) or of
any third party acting on their behalf (the "Collateral"), whether for the
express purpose of being used by the Agent or any of the Banks as collateral
security or for safekeeping or for any other or different purpose, including
such personal property as may be in transit by mail or carrier for any purpose
or covered or affected by any documents in the Agent's or any Bank's possession
or control, or in the possession or control of any third party acting on behalf
of the Agent or any of the Banks, or any collateral which secures any other
obligations of the Guarantor to the Agent or any of the Banks. The Guarantor
hereby authorizes the Agent or any of the Banks in their discretion, at any
time, to appropriate and apply upon any of their liabilities of the Guarantor
under this Guaranty any such property of the Guarantor and to charge any of such
liabilities against any balance of any account standing to the credit of the
Guarantor on the books of the Agent or any of the Banks. To satisfy the
liabilities of the Guarantor under this Guaranty, the Agent and the Banks shall
have, in addition to all other rights and remedies allowed by law, the rights
and remedies of a secured party under the Uniform Commercial Code as in effect
- 3 -
in the State of New York at the date hereof and, without limiting the generality
of the foregoing, the Agent or any Bank may immediately, without demand of
performance and without notice of intention to sell or otherwise to dispose of
or of the time or place of sale or of redemption or other notice or demand
whatsoever to the Guarantor, all of which are hereby expressly waived, to the
extent permitted by law, and without advertisement, sell at public or private
sale, grant options to purchase or otherwise realize upon, in the State of New
York, or elsewhere, the whole or from time to time any part of the said
Collateral upon which the Agent or such Bank shall have a security interest and
lien as aforesaid, and after deducting from the proceeds of sale or other
disposition of the said Collateral all expenses (including all reasonable
expenses for legal services of every kind and other expenses as set forth below)
shall apply the residue of such proceeds towards the payment of any of the
liabilities of the Guarantor under this Guaranty in such order as the Agent or
such Bank shall elect, the Guarantor remaining liable for any deficiency
remaining unpaid after such application. If notice of any sale or other
disposition is required by law to be given, the Guarantor hereby agrees that a
notice sent at least five (5) days before the time of any intended public sale
or of the time after which any private sale or other disposition of the said
Collateral is to be made, shall be reasonable notice of such sale or other
disposition.
5. At any such sale or other disposition of said Collateral the Agent or
any of the Banks or any person designated by the Agent or any of the Banks may
itself purchase the whole or any part of the Collateral sold or otherwise
disposed of, free from any right of redemption on the part of the Guarantor,
which right, to the extent permitted by law, is hereby waived and released.
6. The Guarantor agrees that the aforementioned Collateral secures, and
further agrees to pay on demand, all expenses (including reasonable expenses for
legal services, whether or not litigation is commenced and cost of any insurance
and payment of taxes or other charges) of, or incidental to, the custody, care,
sale or collection of, or realization upon, any of the said Collateral or in any
way relating to the enforcement or protection of the rights of the Agent or any
of the Banks hereunder or under or with respect to any of the Obligations.
- 4 -
7. This is a continuing Guaranty and shall remain in full force and effect
and shall apply to all Obligations notwithstanding that at any particular time
any or all of the Obligations shall have been paid in full. No attempted
revocation shall release the Guarantor or affect in any manner the rights,
remedies, powers, security interests and liens of the Agent or any of the Banks
under this Guaranty with respect to any of the Obligations. If any of the
present or future Obligations are guaranteed by persons, partnerships, limited
liability companies or corporations in addition to the Guarantor, the death,
release or discharge in whole or in part, or the bankruptcy, liquidation or
dissolution of one or more of them, shall not discharge or affect the
liabilities of the Guarantor under this Guaranty.
8. This Guaranty shall continue to be effective, or be reinstated, as the
case may be, if at any time any payment, or any part thereof, of any of the
Obligations is rescinded or must otherwise be restored or returned by the Agent
or any of the Banks upon insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Borrower or the Guarantor, or otherwise, or upon or as a
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Borrower or the Guarantor or any substantial
part of their property, or otherwise, all as though such payments had not been
made.
9. This Guaranty is a guaranty of payment and not of collection, and
neither the Agent nor any of the Banks shall be under an obligation to take any
action against the Borrower or any other person liable with respect to any of
the Obligations or resort to any collateral security held by any of them to
secure any of the Obligations as a condition precedent to the Guarantor being
obligated to make payment and to perform as agreed herein. The Guarantor hereby
waives any rights to interpose any defense, counterclaim or offset of any nature
and description which it may have or which may exist between and among the Agent
or any of the Banks, the Borrower and/or the Guarantor. Neither the Agent, the
Banks nor their respective successors, endorsees or assigns shall have any
obligation to protect, secure, perfect or insure any lien at any time held by
any of them as security for the Obligations or for this Guaranty or any property
subject thereto or hereto, but at the Agent's or such Bank's sole option and
without prejudice may do so or incompletely do so, and the Guarantor's
- 5 -
obligations hereunder shall in no way be affected by reason thereof. This
Guaranty may be assigned by the Agent and its benefits shall inure to the
successors, indorsees and assigns of the Agent.
10. THE GUARANTOR, THE AGENT AND THE BANKS HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE ANY RIGHT TO TRIAL BY JURY WHICH THE GUARANTOR, THE
AGENT AND THE BANKS MAY HAVE IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM,
AT LAW OR IN EQUITY, IN CONNECTION WITH THIS GUARANTY OR THE TRANSACTIONS
RELATED HERETO. THE GUARANTOR REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE OR
AGENT OF THE AGENT OR ANY OF THE BANKS HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT THE AGENT OR ANY OF THE BANKS WILL NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THIS JURY TRIAL WAIVER. THE GUARANTOR ACKNOWLEDGES THAT THE AGENT AND
THE BANKS HAVE BEEN INDUCED TO ACCEPT THIS GUARANTY BY, AMONG OTHER THINGS, THE
PROVISIONS OF THIS SECTION.
11. Until such time as the Obligations have been indefeasibly paid in full,
the Guarantor hereby waives all rights to be subrogated to the rights of the
Agent or any of the Banks with respect to the Obligations. In addition, the
Guarantor hereby waives, until such time as the Obligations have been
indefeasibly paid in full, any right to proceed against the Borrower, now or
hereafter, for contribution, indemnity, reimbursement and all other suretyship
rights and claims, whether direct or indirect, liquidated or contingent, whether
arising under express or implied contract or by operation of law, which the
Guarantor may now or hereafter have against the Borrower with respect to the
Obligations and the Guarantor agrees that it will not take any such action
against the Borrower or against any other person seeking contribution,
reimbursement or indemnification by the Borrower or such other person with
respect to the Obligations. The Guarantor also hereby waives, until such time as
the Obligations have been indefeasibly paid in full, any rights to recourse to
or with respect to any assets of the Borrower. The Guarantor agrees that in
light of the waivers contained in this Paragraph 11, the execution of this
Guaranty shall not be deemed to make the Guarantor a creditor of the Borrower,
and that for the purposes of Sections 547 and 550 of the United States
Bankruptcy Code (11 U.S.C. Sec. 547, 550), the Guarantor shall not be deemed a
creditor of the Borrower. If any amount shall be paid to the Guarantor on
account of such subrogation rights at any time when all such Obligations shall
not have been indefeasibly paid in full, such amount shall be held in trust for
- 6 -
the benefit of the Agent and the Banks and shall forthwith be paid to the Agent
to be credited and applied upon the Obligations.
12. The Guarantor authorizes the Agent to date this Guaranty and to
complete any blank space herein according to the terms upon which this Guaranty
was given. Any notice to any party hereto shall be given as provided for in the
Loan Agreement.
13. No failure on the part of the Agent or any of the Banks 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 the Agent or
any of the Banks of any right, remedy or power hereunder preclude any other or
future exercise of any other right, remedy or power.
14. Each and every right, remedy and power hereby granted to the Agent or
any of the Banks or allowed them by law or other agreement shall be cumulative
and not exclusive of any other right, remedy and power, and may be exercised by
the Agent or any of the Banks at any time and from time to time.
15. This Guaranty embodies the entire agreement and understanding between
the Agent, the Banks and the Guarantor and supersedes all prior agreements and
understandings relating to the subject matter hereof. This Guaranty may not be
amended, and compliance with its terms may not be waived, orally or by course of
dealing, but only by a writing signed by an authorized officer of the Agent.
16. This Guaranty shall be construed and interpreted and all rights and
obligations hereunder shall be determined, in accordance with the laws of the
State of New York, without regard to principles of conflict of laws. The
Guarantor agrees that any action or proceeding relating in any way to this
Guaranty shall be brought and enforced in the courts of the State of New York or
the United States District Court for the Southern or Eastern District of New
York, and irrevocably submits to the jurisdiction of each such court in any
action or proceeding arising out of or relating to this Guaranty, and the
Guarantor irrevocably agrees that all claims in respect of such action or
proceeding may be heard and determined in such New York State or Federal Court.
In furtherance of the foregoing, the Guarantor hereby irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
- 7 -
have to the laying of venue in any action or proceeding relating in any way to
this Guaranty brought in the Supreme Court of the State of New York within
Nassau and Suffolk Counties or the United States District Court for the Eastern
District of New York and any claim that such action or proceeding brought in any
such court has been brought in an inconvenient forum. Notwithstanding the
foregoing, the Agent or any of the Banks may bring any action or proceeding
against the Guarantor or its property in the courts of such jurisdictions as are
deemed necessary by the Agent or any of the Banks in its sole and absolute
discretion. The Guarantor agrees to pay all costs and expenses incurred by the
Agent or any of the Banks incidental to or in any way relating to the
enforcement of the Obligations or the obligations of or the protection of the
rights of the Agent or any of the Banks hereunder, including, but not limited
to, reasonable attorneys' fees and expenses, whether or not litigation is
commenced.
17. This Guaranty shall remain in full force and effect until there is
indefeasible cash payment of the Obligations in full and the Total Commitment
and each of the Commitments of the Banks have terminated. No payment or payments
made by any person or received or collected by the Agent or any of the Banks
from any person by virtue of any action or proceeding or any setoff or
appropriation or application, at any time or from time to time, in reduction of
or in payment of the Obligations shall be deemed to modify, reduce, release or
otherwise affect the liability of the Guarantor hereunder which shall,
notwithstanding any such payment or payments, remain in place until there is
cash payment of the Obligations in full.
18. The Guarantor represents and warrants that all necessary and proper
corporate action has been taken to make this Guaranty and all of the provisions
hereof the valid and binding obligations of the Guarantor, enforceable against
the Guarantor in accordance with its terms.
19. Every provision of this Guaranty is intended to be severable and any
provision(s) of this Guaranty which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to extent of such
prohibition or enforceability without invalidating the remaining provisions
hereof, and any prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
- 8 -
20. None of the terms or provisions of this Guaranty may be waived,
amended, supplemented or otherwise modified except by a written instrument
executed by the Guarantor, the Agent and the Banks.
21. If this Guaranty is executed by two or more parties, they shall be
jointly and severally liable hereunder, and the word "Guarantor" wherever used
herein shall be construed to refer to each of such parties separately, all in
the same manner and with the same effect as if each of them had signed separate
instruments; and in any such case this Guaranty shall not be revoked or impaired
as to any one or more of such parties by the death or dissolution of any of the
others or by the revocation or release of any liabilities hereunder of any one
or more of such other parties and the Bank may proceed against none, one or more
of the Guarantors at one time, or from time to time, in its sole and absolute
discretion.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
by its authorized officer as of this 30th day of July, 2002.
E.TRACK SOLUTIONS, INC.
By: /S/ Barry R. Steinberg
----------------------
Name: Barry R. Steinberg
Title: Chief Executive Officer
- 9 -
SCHEDULE A
MANCHESTER TECHNOLOGIES, INC.
MANCHESTER INTERNATIONAL LTD.
ODD LOTS 4U.COM, INC.
MEC LEASING GROUP, LTD.
MANCHESTER SOLUTIONS, INC.
MANTECH COMPUTER SERVICES, INC.
ELECTROGRAPH SYSTEMS, INC.
COASTAL OFFICE PRODUCTS, INC.
MEC SUPPORT SERVICES, INC.
CLOSE OUTS 4U.COM, INC.
MEC INTERNET SERVICES, INC.
47 COMPUTERS.COM, INC.
MARKETPLACE 4U.COM, INC.
4U.COM, INC.
ALMOST NEW 4U.COM, INC.
TEXPORT TECHNOLOGY GROUP, INC.
LEARNING TECHNOLOGY GROUP, LLC
DONOVAN CONSULTING GROUP, INC.
- 10 -
- 2 -
E.TRACK SOLUTIONS, INC.
SECRETARY'S CERTIFICATE
The undersigned, Secretary of E.Track Solutions, Inc., a New York
corporation (the "Guarantor"), does hereby certify that:
1. This certificate is furnished in connection with the execution and
delivery of a Fourth Amendment dated as of July 30, 2002 (the "Amendment") to
that certain Loan Agreement dated as of June 25, 1999 among Citibank, N.A.,
successor to European American Bank, as Agent (the "Agent"), Citibank, N.A.,
successor to European American Bank ("Citibank")(Citibank being a "Bank"), the
Guarantor, the Borrower and certain other Guarantors (the "Agreement").
Capitalized terms used but not defined herein shall have the meanings given them
in the Agreement.
2. Attached hereto as Exhibit "A" are true and correct copies of
resolutions duly and unanimously adopted by the Board of Directors and
shareholders of the Guarantor, which resolutions have not been revoked,
modified, amended or rescinded and are still in full force and effect, and
authorize the execution and delivery, by any of the below-named individuals, of
the Guaranty, the Import L/C Documents, the B/A Documents, the other Loan
Documents to which the Guarantor is a party and any other documents to be
executed in connection with the Agreement and the transactions contemplated
thereby.
3. Annexed hereto as Exhibit "B" are true and correct copies of the
Certificate of Incorporation and by-laws of the Guarantor as in effect on the
date hereof.
4. Attached hereto as Exhibit "C" is a Certificate of Good Standing from
the Secretary of State of the State of New York.
5. The below-named persons are the duly elected and qualified officers of
the Guarantor holding the respective offices set forth opposite their names, and
the signatures below set forth opposite their names are their genuine
signatures:
Name Office Signature
---- ------ ---------
Barry Steinberg Chief Executive Officer /S/ Barry Steinberg
Joel Stemple Secretary /S/ Joel Stemple
6. Listed below are all of the shareholders of the Guarantor, with their
respective ownership of shares in the Guarantor set forth opposite their names.
Shareholder Percentage of Ownership
- ----------- -----------------------
Manchester Technologies, Inc. 100%
7. The Agent and the Bank may rely on this certificate and the statements
made herein to induce it to enter into the Agreement and the transactions
contemplated thereby.
WITNESS my hand this 28th day of October, 2002.
/S/ Joel Stemple
---------------
Joel Stemple, Secretary
The undersigned, Barry Steinberg, Chief Executive Officer of the Guarantor,
does hereby certify that Joel Stemple is the duly elected and qualified
Secretary of the Guarantor, and that the signature above is his/her genuine
signature.
WITNESS my hand this 28 day of October, 2002.
/S/ Barry Steinberg
------------------
Barry Steinberg
Chief Executive Officer
- 2 -
EXHIBIT A
---------
E.TRACK SOLUTIONS, INC.
BOARD OF DIRECTOR RESOLUTIONS
SHAREHOLDER RESOLUTIONS
RESOLVED, that this Corporation guaranty all of the obligations of each of
the entities set forth on Schedule A hereto, to Citibank, N.A., successor to
European American Bank ("Citibank") and to Citibank, N.A., successor to European
American Bank, as Agent (the "Agent"), whether incurred in connection with the
execution and delivery of the Agreement (as hereinafter defined) or otherwise;
and be it further
RESOLVED, that this Corporation have Import Letters of Credit issued on its
behalf from time to time as required by in connection with this Corporation's
business; and be it further
RESOLVED, that this Corporation have Bankers Acceptances created on its
behalf from time to time as required by in connection with this Corporation's
business; and be it further
RESOLVED, that the forms, terms and provisions of:
(a) the proposed Import L/C Documents;
(b) the proposed B/A Documents;
(c) the proposed Guaranty (the "Guaranty"), to be issued by this
Corporation to the Agent and the Banks, a copy of which has been presented to
this Board and to the shareholders of this Corporation; and
(d) the proposed Fourth Amendment dated as of July 30, 2002 (the
"Amendment") to that certain Loan Agreement dated as of June 25, 1999 (the
"Agreement") among this Company, the Agent, the Banks, the Borrower and certain
other Guarantors, a copy of which has been presented to this Board
be, and the same hereby are in all respects approved, and that the officers of
- 3 -
this Corporation be, and each of them hereby is, authorized, in the name and on
behalf of this Corporation, to execute and deliver the Import L/C Documents, the
Guaranty, the Amendment and all other Loan Documents (as defined in the
Agreement) to which this Corporation is a party, in such form as the officer of
this Corporation executing the same shall approve, such approval to be
conclusively evidenced by his execution and delivery thereof; and be it further
RESOLVED, that the President, Chief Financial Officer, Treasurer, any Vice
President, the Secretary and any Assistant Secretary of this Corporation be, and
each of them hereby is, authorized and empowered (any one of them acting alone)
to do or cause to be done all such acts or things and to sign and deliver, or
cause to be signed and delivered, all such documents, instruments, financing
statements and certificates in the name and on behalf of this Corporation or
otherwise, as such officer of this Corporation may deem necessary, advisable or
appropriate to effectuate or carry out the purposes and intent of the foregoing
resolutions and to perform the obligations of this Corporation under the
agreements and instruments referred to therein.
Terms not defined herein shall have the meanings ascribed to them in the
Agreement.
- 4 -
SCHEDULE A TO RESOLUTIONS
MANCHESTER TECHNOLOGIES, INC.
ELECTROGRAPH SYSTEMS, INC.
MANCHESTER INTERNATIONAL LTD.
MANTECH COMPUTER SERVICES, INC.
MEC LEASING GROUP, LTD.
MANCHESTER SOLUTIONS, INC.
MEC INTERNET SERVICES, INC.
COASTAL OFFICE PRODUCTS, INC.
CLOSE OUTS 4U.COM, INC.
47 COMPUTERS.COM, INC.
MARKETPLACE 4U.COM, INC.
4U.COM, INC.
ALMOST NEW 4U.COM, INC.
ODD LOTS 4U.COM, INC.
TEXPORT TECHNOLOGY GROUP, INC.
LEARNING TECHNOLOGY GROUP, LLC
DONOVAN CONSULTING GROUP, INC.
- 5 -