EXHIBIT 10.3
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GUARANTY
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THIS GUARANTY, made and entered into as of the 31st day of December, 2004,
is by Global Matrechs, Inc. (the "Guarantor"), a Delaware corporation having a
principal place of business at 90 Grove Street, Ridgefield Connecticut 06877 to
Mark T. Allen, residing at 29 Loring Drive, Norwell, Massachusetts 02061,
(together with with any legal representatives, heirs, successors and assigns to
become holders of the hereinafter described Obligations referred to herein
individually and collectively as the "Obligee").
W I T N E S S E T H:
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WHEREAS,Obligee has extended credit to True To Form, Limited ("Debtor") as
evidenced by that certain Secured Note dated as of December 31, 2004 (as
amended, restated, modified, or replaced from time to time, the "Note"), in
connection with the merger of True to Form, Limited , a Massachusetts
corporation and TTF Acquisition Corp., a wholly owned subsidiary of Guarantor.
To induce Obligee to extend credit to Debtor, Guarantor has agreed to guarantee
the Obligations, as hereinafter defined and executes and delivers this Guarantee
to Secured Party. All capitalized terms used herein and not otherwise defined
shall have the same meanings assigned to such terms in the Note or the Security
Agreement from Debtor to Obligee of even date herewith.
WHEREAS, pursuant to the Agreement and Plan of Merger, the Guarantor has
agreed to make certain other payments and perform certain obligations to the
Obligee (together with the Note referred to herein collectively as the
"Obligations"); and
WHEREAS, in order to secure the Obligations, the Obligee is requiring the
instant Guaranty by the Guarantor; and
WHEREAS, the Guarantor expects to derive an advantage from the Obligee's
deferral of the Merger Consideration and extension of credit to the Debtor and
is therefore willing to enter into this Guaranty,
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which hereby are acknowledged, and in consideration of the
premises as aforesaid, the Guarantor, intending to be legally bound, hereby
agrees, guarantees and covenants as follows:
1. The Guarantor hereby absolutely and unconditionally guarantees (a) the
full and prompt payment of all principal, interest and any other sum due and
payable pursuant to the terms of the Obligations, (b) the due and punctual
performance and observance of all the terms and conditions of the Obligations,
and (c) to pay the costs of collection, including, without limitation,
reasonable legal expenses and reasonable attorneys' fees, paid or incurred by
the Obligee in collecting and/or enforcing the Obligations, whether at maturity
or earlier by reason of acceleration or otherwise, as demanded by the Obligee
and, in case of one or more extensions of time, or renewals or modifications, in
whole or in part, of the Obligations, that the same will be promptly paid and/or
performed when due and as required according to each such extension, renewal or
modification, whether at maturity or earlier by reason of acceleration or
otherwise.
2. This is a guaranty of payment and not of collection. The liability of
the Guarantor on this Guaranty shall be direct and immediate and not conditioned
or contingent upon the pursuit of any remedies against the Debtor, any other
guarantor of all or part of the Obligations (or any other obligation of the
Debtor) or any other person, nor upon the pursuit of any remedies against any
collateral available to the Obligee. The Guarantor waives any right to require
that an action be brought against the Debtor or any other person or to require
that resort be had to any security or collateral available to the Obligee. Upon
failure of the Guarantor to pay promptly all amounts due under this Guaranty
upon demand, the Guarantor agrees to pay all reasonable legal and other costs
and expenses, including, without limitation, reasonable attorneys' fees, paid or
incurred by the Obligee in connection with the enforcement of this Guaranty.
3. The Guarantor agrees that whenever at any time or from time to time
the Guarantor shall make any payment to the Obligee hereunder on account of any
obligations guaranteed hereunder, the Guarantor shall notify the Obligee in
writing that such payment is made under this Guaranty for such purpose.
4. The Obligee may assign this Guaranty or any of the Obligee's rights
and powers hereunder and may assign and/or deliver to any such assignee any of
the security for the Obligations and, in the event of such assignment, the
assignee hereof or of such rights and powers, shall have the same rights and
remedies as if originally named herein in place of the Obligee.
5. The Guarantor agrees and consents that the whole or any part of any
security which may now or hereafter be held for the indebtedness of the Debtor
may be exchanged, compromised, substituted or surrendered at any time or from
time to time; that the time or place of payment of the debt of the Debtor
secured hereby may be changed or extended, in whole or in part, to a time
certain or otherwise, and may be renewed, modified, increased, decreased, or
accelerated in whole or in part; that the Debtor may be granted indulgences
generally; that any of the provisions of the Obligations or other instruments
evidencing any indebtedness of the Debtor or any security therefor may be
modified or waived; that any party liable for the payment thereof (including,
without limitation, any other co-guarantor) may be granted indulgences or
released, all without notice to or further assent by the Guarantor, who shall
remain bound notwithstanding any exchange, compromise, surrender, extension,
renewal, increase or decrease in indebtedness, acceleration, modification,
indulgence or release.
6. Notice of acceptance of this Guaranty and of the incurring of any and
all of the Obligations of the Debtor hereinbefore mentioned is hereby waived by
the Guarantor. The Guarantor also hereby waives presentment, demand, protest,
notice of protest and notice of dishonor of any Obligation guaranteed hereby.
This Guaranty and all rights, obligations and liabilities arising hereunder
shall be construed in accordance with the laws of the State of New York. For
purposes of settling any disputes hereunder, the Obligee and the Guarantor
hereby submit themselves to the jurisdiction of any court, federal or state,
sitting in New York County, New York, and hereby further waive any and all
objections as to the venue of any such court and hereby further waive trial by
jury.
7. No set-off, counterclaim (except for such counterclaim which, unless
asserted, is waived), reduction or diminution of any obligation (other than
performance by the Guarantor in full of his obligation hereunder) shall be
available to the Guarantor in any action brought by the Obligee against the
Guarantor hereunder.
8. If any provision of this Guaranty shall be held to be invalid by any
court of competent jurisdiction, the invalidity of such provision shall not
affect any of the remaining provisions, and this Guaranty shall be enforced to
the maximum extent permitted by law.
9. No omission or delay on the Obligee's part in exercising any right
hereunder or in taking any action to collect or enforce payment of any
Obligations guaranteed hereby shall constitute a waiver of any such right or
release or affect the obligations of Guarantor hereunder.
10. This Guaranty shall bind the heirs, executors, adminis trators,
successors and assigns of the Guarantor. So long as the Debtor's Obligations to
the Obligee have not been paid in full, no payment by the Guarantor pursuant to
the provisions hereof shall entitle the Guarantor, by subrogation to the right
of the Obligee or otherwise, to any payment by the Debtor or out of the property
of the Debtor. A subsequent guaranty by the Guarantor or any other guarantor of
Debtor's Obligations guaranteed and secured hereby shall not be deemed to be in
lieu of or to supersede or terminate this Guaranty unless agreed to in writing
by the Obligee; and, in the event the Guarantor, or any other guarantors, have
given to the Obligee a previous guaranty or guaranties, this Guaranty shall be
construed to be an additional or
supplementary guaranty, and not to be in lieu thereof or to terminate such
previous guaranty or guaranties unless expressly so provided herein.
11. All notices and other communications hereunder shall be in writing and
shall be deemed given if delivered by hand, sent by facsimile transmission with
confirmation of receipt, sent via a reputable overnight courier service with
confirmation of receipt requested, or mailed by registered or certified mail
(postage prepaid and return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
notice), and shall be deemed given on the date on which delivered by hand or
otherwise on the date of receipt as confirmed:
To the Guarantor:
Global Matrechs, Inc.
90 Grove Street, Suite 201
Ridgefield, Connecticut 06877
Attn: Michael Sheppard
Facsimile: (203) 431-8304
With a copy to:
Foley Hoag LLP
155 Seaport Boulevard
Boston, Massachusetts 02210
Attn: David A Broadwin, Esq.
Facsimile: (617) 832-7000
To the Obligee:
Mark Allen
91 French Avenue
Braintree, MA 02184
PH: 781.848.1174
FX: 781.848.1175
With a copy to:
Samuel Krieger
Krieger & Prager LLP
39 Broadway
New York, NY 10006
Facsimile: (212 ) 363-2999
IN WITNESS WHEREOF, the Guarantor has duly executed this Guaranty as of the 31st
day of December, 2004
GLOBAL MATRECHS, INC.
By: /s/ Michael Sheppard
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Michael Sheppard, President