Exhibit 10.23
GUARANTY
THIS GUARANTY dated as of December 24, 1997 (the "Guaranty"), made by
GENIE INTERACTIVE, INC., a New Jersey corporation, with an address at 294
State Street, Hackensack, New Jersey 07601, IDT AMERICA, CORP., a New Jersey
corporation, with an address at 294 State Street, Hackensack, New Jersey
07601, IDT INTERNATIONAL, CORP., a New Jersey corporation, with an address at
294 State Street, Hackensack, New Jersey 07601, IDT INTERNET SERVICES, INC.,
a Delaware corporation, with an address at 294 State Street, Hackensack, New
Jersey 07601, INTERNET ONLINE SERVICES, INC., a New Jersey corporation, with
an address at 294 State Street, Hackensack, New Jersey 07601, MEDIA RESPONSE,
INC., a New Jersey corporation, with an address at 294 State Street,
Hackensack, New Jersey 07601, NEW WORLD TELECOMMUNICATIONS, CORP., a New
Jersey corporation, with an address at 294 State Street, Hackensack, New
Jersey 07601, and YOVELLE RENAISSANCE CORPORATION, a Delaware corporation,
with an address at 294 State Street, Hackensack, New Jersey 07601 (jointly
and severally, the "Guarantor"), in favor of TRANSAMERICA BUSINESS CREDIT
CORPORATION, a Delaware corporation, ("TBCC") having its principal office at
9399 West Higgins Road, Suite 600, Rosemont, Illinois 60018 and having an
office at 16133 Ventura Blvd., Suite 700, Encino, California 91436, with
respect to the "Indebtedness" (as defined below) of IDT CORPORATION, a
Delaware corporation (the "Borrower").
1. Guaranty. The Guarantor hereby (a) unconditionally and irrevocably
guarantees the punctual payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of all of the Indebtedness, and (b)
agrees to pay any and all reasonable costs and expenses (including reasonable
attorneys' fees and related expenses) incurred by the TBCC in enforcing any
rights under this Guaranty. As used herein, "Indebtedness" means and includes
all loans (including the Loans), advances, debts, liabilities, obligations,
covenants and duties owing by Borrower to TBCC of any kind or nature, present
or future, whether or not evidenced by any note, guaranty or other
instrument, which may arise under, out of, or in connection with, any present
or future Loan and Security Agreement between Borrower and TBCC (the "Loan
Agreement"), any other Loan Document or any other agreement executed in
connection herewith or therewith, whether or not for the payment of money,
whether arising by reason of an extension of credit, opening, guaranteeing or
confirming of a letter of credit, loan, guaranty, indemnification or in any
other manner, whether direct or indirect (including those acquired by
assignment, purchase, discount or otherwise), whether absolute or contingent,
due or to become due, now due or hereafter arising and however acquired. The
term "Indebtedness" includes, without limitation, all interest (including
interest accruing on or after an Insolvency Event, whether or not an allowed
claim), charges, expenses, commitment, facility, closing and collateral
management fees, letter of credit fees, reasonable attorneys' fees, and any
other sum properly chargeable to Borrower under the Loan Agreement, the other
Loan Documents or any other agreement executed in connection herewith
or therewith. (Capitalized terms used in this Guaranty, which are not defined,
shall have the meanings set forth in the Loan Agreement.)
2. Guaranty Absolute. The Guarantor guarantees that the Indebtedness
will be paid and performed strictly in accordance with the terms of the Loan
Agreement regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of the terms or the rights of the
TBCC with respect thereto. The liability of the Guarantor under this Guaranty
shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Loan Agreement or
any other agreement or instrument relating thereto, including, without
limitation, this Guaranty (collectively, the "Loan Documents");
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(b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Indebtedness, or any amendment or waiver of
any term of or any consent to departure from the Loan Agreement or any other
Loan Document;
(c) any exchange, release or non-perfection of any collateral, or any
release, amendment or waiver of any term of, or consent to departure from,
any other guaranty for all or any of the Indebtedness;
(d) any failure on the part of the TBCC or any other person or
entity to exercise, or any delay in exercising, any right under the Loan
Agreement or any other Loan Document; or
(e) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Borrower, the Guarantor or any
other guarantor with respect to the Indebtedness (including, without
limitation, all defenses based on suretyship or impairment of collateral, and
all defenses that the Borrower may assert to the repayment of the
Indebtedness, including, without limitation, failure of consideration, breach
of warranty, fraud, payment, statute of frauds, bankruptcy, lack of legal
capacity, statute of limitations, lender liability, accord and satisfaction,
and usury) or which might otherwise constitute a defense to this Guaranty and
the obligations of the Guarantor under this Guaranty.
The Guarantor hereby agrees that if the Borrower or any other guarantor of all
or a portion of the Indebtedness is the subject of a bankruptcy proceeding
under Title 11 of the United States Code, it will not assert the pendency of
such proceeding or any order entered therein as a defense to the timely
payment of the Indebtedness. This Guaranty shall continue to be effective or
be reinstated, as the case may be, if at any time any payment of any of the
Indebtedness is rescinded or must otherwise be returned by the TBCC upon the
insolvency, bankruptcy or reorganization of the Borrower or otherwise, all as
though the payment had not been made.
3. Waiver. The Guarantor hereby waives promptness, diligence, notice of
acceptance and any other notice with respect to any of the Indebtedness and
this Guaranty and any requirement that the TBCC protect, secure, perfect or
insure any security interest or lien or any property subject thereto or
exhaust any right to take any action against the Borrower or any other person
or any collateral.
4. Subrogation. The Guarantor hereby irrevocably waives, to the fullest
extent permitted by law, any and all claims, rights or remedies which it may
now have or hereafter acquire against the Borrower that arise hereunder or
from the performance by him hereunder including, without limitation, any
claims, rights or remedies of subrogation, reimbursement, exoneration,
contribution, indemnification or participation in any claims, rights or
remedies of the TBCC against the Borrower or in any security which the TBCC
now has or hereafter acquires, whether or not the claims, rights or remedies
arise in equity, under contract, by statute, under common law or otherwise.
5. Representations and Warranties. The Guarantor hereby represents and
warrants as follows:
(a) Power and Authority. The Guarantor has full power, authority,
capacity and legal right to execute and deliver and to perform its
obligations under this Guaranty and the other Loan Documents to which the
Guarantor is a party.
(b) Enforceability. This Guaranty and the other Loan Documents to
which the Guarantor is a party have been duly executed and delivered by the
Guarantor and constitute a legal, valid and binding obligation of the
Guarantor, enforceable against the Guarantor, its
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successors and assigns (and, in the case of Guarantors who are individuals,
their heirs, estate, personal representatives, executors and administrators)
in accordance with their respective terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors' rights generally.
(c) No Conflicts. The execution, delivery and performance of this
Guaranty and the other Loan Documents to which the Guarantor is a party will
not violate any requirement of law or contractual obligation of the Guarantor
or result in the creation or imposition of any lien on any of the property or
assets of the Guarantor, except for liens (if any) granted in favor of the
TBCC pursuant to the Loan Documents.
(d) No Consents. No consent of any other Person and no consent,
license, permit, approval or authorization, of, exemption by, notice or
report to, or registration, filing or declaration with, and governmental
authority is required in connection with the execution, delivery,
performance, validity or enforceability of this Guaranty and the other Loan
Documents to which the Guarantor is a party.
(e) Solvency. The fair value of the property of the Guarantor
exceeds the total amount of liabilities (including, without limitation,
contingent liabilities) of the Guarantor; the present fair saleable value of
the assets of the Guarantor exceeds the amount that will be required to pay
the probable liability of the Guarantor on its existing debts as they become
absolute and matured; the Guarantor is able to realize upon its assets and
pay its debts and other liabilities, contingent obligations and other
commitments as they mature and the Guarantor does not intend to, and does not
believe that it will, incur debts or liabilities beyond the Guarantor's
ability to pay as the debts and liabilities mature. In computing the amount
of contingent liabilities at any time, it is intended that the liabilities
will be computed at the amount which, in light of all facts and circumstances
existing at such time, represents the amount that can reasonably be expected
to become an actual or mature liability.
(f) Absence of Litigation. Except as otherwise heretofore disclosed
to the TBCC in writing, there are no actions, suits, investigations,
litigation or proceedings pending or, to the knowledge of the Guarantor,
threatened against or affecting the Guarantor or any of its properties before
any court, arbitrator or governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, that has an amount in
controversy in excess of $25,000, or which purports to affect any part of the
transactions contemplated hereby or by the other Loan Documents to which the
Guarantor is a party or the legality, validity or enforceability of this
Guaranty or other other Loan Documents to which the Guarantor is a party.
(g) Financial Condition. The financial condition and net worth of
the Guarantor contained in the financial statements, dated _______________
are true and correct; there is no event, fact, circumstance or condition
known to the Guarantor which is inconsistent with the statements or is
required to be disclosed in order to cause the statements not to be
misleading; and the Guarantor knows of no reason why it will not be able to
perform duly and promptly its obligations under this Guaranty.
(h) Payment of Taxes. The Guarantor has filed all tax returns
(federal, state, local and foreign) required to be filed and paid all taxes
shown thereon to be due, including interest and penalties, except for such
taxes as are being contested in good faith and by proper proceedings.
6. Covenants. The Guarantor covenants and agrees that, so long as any
part of the Indebtedness shall remain unpaid, the Guarantor shall provide the
TBCC with financial statements relating to the financial condition and net
worth of the Guarantor and the ability of the Guarantor to satisfy its
obligations hereunder, such financial statements to be certified as being
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true and correct by the Guarantor. Such financial statements shall be
provided (i) in the case of a Guarantor who is an individual, as of December
31 of each year, by January 31 of the following year; (ii) in the case of a
Guarantor which is a corporation, partnership, limited liability company,
trust, or any other entity or organization, within 120 days after the end of
the Guarantor's fiscal year.
7. Amendments, Etc. No amendment or waiver of any provision of this
Guaranty or consent to any departure by the Guarantor therefrom shall in any
event be effective unless the same shall be in writing and signed by the
TBCC, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
8. Addresses for Notices. All notices and other communications provided
for hereunder shall be in writing (including by telecopier) and, if to the
Guarantor, mailed or delivered to him at its address specified on the first
page of this Guaranty, if to the TBCC, mailed or delivered to it at the
address of the TBCC specified on the first page of this Guaranty, or as to
each party at such other address as shall be designated by the party in a
written notice to the other party. All the notices and other communications
shall, if mailed, be effective when deposited in the mail addressed as
aforesaid.
9. No Waiver; Remedies. No failure on the part of the TBCC to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof. No single or partial exercise of any right hereunder shall preclude
any other or further exercise thereof or the exercise of any other right. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.
10. Right of Set-off. The TBCC is hereby authorized at any time and from
time-to-time following an Event of Default, to the fullest extent permitted
by law,, to set off and apply any and all deposits (general or special, time
or demand, provisional of final) at any time held and other indebtedness at
any time owing by the TBCC to or for the credit or the account of the
Guarantor against any and all of the obligations of the Guarantor now or
hereafter existing under this Guaranty, irrespective of whether or not the
TBCC shall have made any demand under this Guaranty and although such
obligations may be contingent and unmatured. The TBCC agrees promptly to
notify the Guarantor after any such set-off and application, provided that
the failure to give such notice shall not affect the validity of such set-off
and application. The rights of the TBCC under this Section are in addition to
the other rights and remedies (including, without limitation, other rights of
set-off) which the TBCC may have.
11. Continuing Guaranty; Assignments. This Guaranty is a continuing
guaranty and shall (a) remain in full force and effect until the indefeasible
payment in full of the Indebtedness and all other amounts payable under this
Guaranty, (b) be binding upon the Guarantor and its successors, assigns,
beneficiaries and indorsees (including, without limitation, the heirs,
administrators, executors and estate of the Guarantor), except that no
Guarantor shall assign or transfer any of its rights or obligations hereunder
without the prior written consent of the TBCC, and (c) insure to the benefit
of the be enforceable by the TBCC and its successors, transferees and
assigns. Without limiting the generality of the foregoing clause (c), the
TBCC may assign or otherwise transfer any of the Indebtedness to any other
person or entity, and such other person or entity shall thereupon become
vested with all the rights in respect thereof granted to the TBCC herein or
otherwise. This Guaranty and the obligations of the Guarantor hereunder shall
terminate upon the indefeasible payment in full of all of the Indebtedness
and all other amounts payable under this Guaranty.
12. Subordination. Any and all payments on any indebtedness or
obligations of the Borrower now or hereafter owing to the Guarantor other
than in respect of salaries or wages (the "Junior Debt") is hereby
subordinated and junior in right of payment and exercise of remedies to
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the prior payment in full in cash of the Indebtedness. Upon the written
request of the TBCC, the Junior Debt shall be collected, enforced and
received by the Guarantor as trustee for the TBCC and paid over to the TBCC
on account of the Indebtedness but without reducing or affecting in any
manner the liability of the Guarantor under the other provisions of this
Guaranty.
13. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS OF THE STATE OF ILLINOIS
WITHOUT GIVEN EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF.
14. Telecopier; Counterparts. This Guaranty may be executed and delivered
by telecopier or other facsimile transmission with the same force and effect
as if the same was a fully executed and delivered original counterpart. This
Guaranty may be executed by the parties in one or more counterparts, each of
which shall be an original and all of this shall constitute one and the same
agreement.
15. CONSENT TO JURISDICTION.
(a) THE GUARANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF
ANY ILLINOIS STATE OR FEDERAL COURT SITTING IN ILLINOIS IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OTHER LOAN
DOCUMENTS, AND THE GUARANTOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF THE ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH
ILLINOIS STATE OR FEDERAL COURT. THE GUARANTOR HEREBY IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT HE MAY EFFECTIVELY DO SO, ANY OBJECTION TO THE LAYING OF
VENUE OR ANY DEFENSE OF AN INCONVENIENT FORUM WHICH HE MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF SUCH ACTION OR PROCEEDING. THE GUARANTOR IRREVOCABLY
CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO THE GUARANTOR AT HIS
ADDRESS SPECIFIED ON THE FIRST PAGE OF THIS GUARANTY. THE GUARANTOR AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE
AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY
OTHER MANNER PROVIDED BY LAW.
(b) NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF THE TBCC TO
SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT
OF THE TBCC TO BRING ANY ACTION OR PROCEEDING AGAINST THE GUARANTOR OR HIS
PROPERTY IN THE COURTS OF ANY OTHER JURISDICTIONS.
16. JURY TRIAL WAIVER. THE GUARANTOR AND, BY ITS ACCEPTANCE HEREOF, THE
TBCC, HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN
ANY COURT RELATING TO, IN CONNECTION
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WITH OR ARISING UNDER THIS GUARANTY OR ANY OF THE OTHER LOAN DOCUMENTS.
IN WITNESS WHEREOF, the Guarantor has executed this Guaranty as of the
date first above written.
GENIE INTERACTIVE, INC. INTERNET ONLINE SERVICES, INC.
By /s/ Stephen Brown By /s/ Stephen Brown
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Title Chief Financial Officer Title Chief Financial Officer
IDT AMERICA, CORP. MEDIA RESPONSE, INC.
By /s/ Stephen Brown By /s/ Stephen Brown
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Title Chief Financial Officer Title Chief Financial Officer
IDT INTERNATIONAL, CORP. NEW WORLD
TELECOMMUNICATIONS, CORP.
By /s/ Stephen Brown By /s/ Stephen Brown
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Title Chief Financial Officer Title Chief Financial Officer
IDT INTERNET SERVICES, INC. YOVELLE RENAISSANCE
CORPORATION
By /s/ Stephen Brown By /s/ Stephen Brown
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Title Chief Financial Officer Title Chief Financial Officer
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