Exhibit 99.4
GUARANTY AGREEMENT
(PCHI)
This Guaranty Agreement (as the same may be amended, modified, or
supplemented from time to time, the "GUARANTY") is made as of March 3, 2005, by
PACIFIC COAST HOLDINGS INVESTMENT, LLC, a California limited liability company
("GUARANTOR"), in favor of MEDICAL PROVIDER FINANCIAL CORPORATION II, a Nevada
corporation ("LENDER"), with reference to the following facts:
RECITALS:
A. This Guaranty is made in connection with a certain Credit Agreement
dated as of the date hereof (as amended, restated, supplemented or otherwise
modified from time to time, the "CREDIT AGREEMENT") by and among Lender and the
Borrowers and certain other "Credit Parties" (as defined therein). Initially
capitalized terms used herein and not otherwise defined herein shall have the
respective meanings ascribed to such terms in the Credit Agreement.
B. AHM CGH, Inc., a California corporation, HEALTH RESOURCES
CORPORATION OF AMERICA- CALIFORNIA, a Delaware corporation, UWMC HOSPITAL
CORPORATION, a California corporation, and SHL/O CORP., a Delaware corporation
(collectively, "SELLER") are in the business of delivering acute care services
to the public through the acute care hospital facilities identified in this
Guaranty, and incident thereto, are also in the businesses of owning and
operating certain medical office buildings ("MOB'S") and other healthcare
businesses related thereto (the "BUSINESSES").
C. Pursuant to a certain Asset Sale Agreement dated as of September 29,
2004 ("ASSET SALE AGREEMENT"), IHHI is acquiring from Seller (a) the fee
interest in certain real property, hospital facilities, MOB's and Businesses in
three (3) separate locations in Orange County, California, and (b) the tenant's
interest in certain leases of real property, hospital facility and an MOB also
located in Orange County, California ("LEASED HOSPITAL FACILITY") (each a
"HOSPITAL FACILITY" and together the "HOSPITAL FACILITIES"), and the business
assets related to the same. To enable IHHI to make these acquisitions, Borrowers
are borrowing the sum of Fifty Million Dollars ($50,000,000) from Lender (the
"ACQUISITION LOAN").
D. Immediately following IHHI's acquisition of the Hospital Facilities,
IHHI will transfer three (3) of the Hospital Facilities to Pacific Coast
Holdings Investment, LLC, a California limited liability company ("PCHI").
Immediately after the transfer to PCHI, IHHI will transfer its ownership
interest in PCHI to (a) West Coast Holdings, LLC, a California limited liability
company ("WEST COAST") a fifty-one percent (51%) membership interest, and (b)
Ganesha Realty, LLC, a California limited liability company ("GANESHA") a
forty-nine percent (49%) membership interest. Then, PCHI will lease the three
(3) Hospital Facilities back to IHHI pursuant to a Triple Net Hospital and
Medical Office Building Lease dated March 3, 2005 (the "TRIPLE NET LEASE").
Then, IHHI will (i) sublease each of the three Hospital Facilities to three (3)
of its subsidiaries (WMC-SA, WMC-A and Coastal), each of which is identified
above as a Borrower, and (ii) sub-sublease the Leased Hospital Facility to
another of its subsidiaries (Chapman), which is also identified above as a
Borrower.
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E. Borrowers have also requested that Lender extend a non-revolving
Line of Credit facility to Borrowers of up to Thirty Million Dollars
($30,000,000) in the aggregate for the purpose of providing (a) working capital
financing for Borrowers, (b) funds for other general corporate purposes of
Borrowers, and (c) funds for other purposes permitted hereunder (the "LINE OF
CREDIT LOAN").
F. For the purposes set forth above, Lender is willing to make the
Acquisition Loan and the Line of Credit Loan and other extensions of credit to
or for the benefit of Borrowers of up to such amount upon the terms and
conditions set forth herein.
G. Among other conditions for making the Acquisition Loan and the Line
of Credit Loan (collectively, the "LOAN"), Lender has required, among other
conditions, that the Guarantor guaranty the payment of the Loan and pledge its
assets as additional security for the payment and performance of the
Obligations, including the Loan, under the Credit Agreement.
H. Guarantor will derive substantial direct and indirect economic
benefits from the Loan.
I. The parties intend that these Recitals are made a part of this
Guaranty.
NOW, THEREFORE, for and in consideration of the foregoing and of any
financial accommodations or extensions of credit (including, without limitation,
any loan or advance by renewal, refinancing or extension of the agreements
described hereinabove or otherwise) heretofore, now or hereafter made to or for
the benefit of any Borrower pursuant to the Credit Agreement or any other
agreement, instrument or document executed pursuant to or in connection
therewith, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Borrower and the Lender
hereby agree as follows:
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Guaranty, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, Lender
and Guarantor agree as follows:
1. Definitions; Certain Matters of Construction.
Unless otherwise set forth herein, (a) initially capitalized terms
or matters of construction defined or established in the Credit Agreement shall
be applied herein as defined or established therein, (b) any reference to a
"Section" shall refer to the relevant section of this Guaranty, and (c) the
following terms shall have, unless otherwise provided elsewhere in this
Guaranty, the meanings set forth below:
"EQUITY INTEREST" means all shares of capital stock, options and
warrants to purchase equity securities or other forms of equity, membership
interests, general or limited partnership interests or other equivalents
(regardless of how designated) of or in a corporation, partnership, limited
liability company or equivalent entity whether voting or nonvoting, including
common stock, preferred stock or any other "equity security" (as such term is
defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the
Securities and Exchange Commission under the Securities Exchange Act).
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"GUARANTY OBLIGATIONS" shall mean (a) the Obligations under the
Credit Agreement, including the Loan and (b) all indebtedness, liabilities, and
obligations of Guarantor to Lender whether now existing or hereafter arising
under this Guaranty.
"GUARANTY TERMINATION DATE" shall mean the date on which Borrower
shall have no further right to receive any financial accommodations under the
Credit Agreement and all Obligations under the Credit Agreement and the Guaranty
Obligations shall have been completely satisfied.
"OBLIGATIONS" has the meaning assigned to it in the Credit
Agreement.
"SOLVENT" shall mean, with respect to Guarantor on a particular
date, that on such date (a) the fair value of the property of Guarantor is
greater than the total amount of its liabilities, including contingent
liabilities; (b) the present fair salable value of the assets of Guarantor is
not less than the amount that will be required to pay the probable liability of
Guarantor on its debts as they become absolute and matured; (c) Guarantor does
not intend to, and does not reasonably believe that it will, incur debts or
liabilities beyond its ability to pay as such debts and liabilities mature; and
(d) Guarantor is not engaged in a business or transaction, and is not about to
engage in a business or transaction, for which its property would constitute an
unreasonably small capital. The amount of contingent liabilities (such as
litigation, guarantees and pension plan liabilities) at any time shall be
computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can be reasonably be expected
to become an actual or matured liability.
2. Guaranty.
2.1 Guaranty of the Obligations.
(a) In consideration of the Loan, all other financial
accommodations to or for the benefit of Borrower and Guarantor, and for other
valuable consideration, the receipt and sufficiency of which Guarantor hereby
acknowledges, Guarantor hereby unconditionally, irrevocably and absolutely
guarantees to Lender, and its respective successors, endorsees, transferees, and
assigns, the prompt payment (whether at stated maturity, by acceleration or
otherwise) and performance of the Loan, together with all other Obligations,
whether now or hereafter existing, and whether for principal, interest, fees,
expenses, or otherwise, howsoever created, arising or evidenced, whether direct
or indirect, absolute or contingent or now or hereafter existing or due or to
become due (including in all cases all such amounts which would become due but
for the operation of the provisions of Title 11 of the United States Code or any
other similar statutes).
(b) This Guaranty constitutes a guaranty of payment and
performance when due and not of collection, and Guarantor specifically agrees
that it shall not be necessary or required that Lender, or any of its
successors, endorsees, transferees, or assigns assert any claim or demand or
enforce any remedy whatsoever against any Borrower, any Credit Party, or any
other Person, or with respect to any collateral (provided by any Borrower or any
Credit Party) (collectively, "COLLATERAL"), before or as a condition to the
obligations of Guarantor under this Guaranty.
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2.2 Absolute Guaranty. The Guaranty Obligations shall remain in
full force and effect without regard to, and shall not be impaired or affected
by, or be deemed to be satisfied by, and Guarantor shall not be exonerated,
discharged or released by, any of the following events:
(a) Lender's exercise or enforcement of, or failure or delay
in exercising or enforcing, legal proceedings to collect the Loan or the
Guaranty Obligations or any power, right, or remedy with respect to any of the
Loan, the Guaranty Obligations, or the Collateral, including without limitation:
(i) any action or inaction of Lender to perfect, protect, or enforce any lien
upon any Collateral; or (ii) any change in the time, manner, or place of payment
of, or in any other term of, any or all of the Loan or the Guaranty Obligations,
or any other amendment to, or waiver of, the Credit Agreement, any other Loan
Document, or any other agreement or instrument governing or evidencing the Loan
or any of the Guaranty Obligations;
(b) insolvency, bankruptcy, reorganization, arrangement,
adjustment, composition, assignment for the benefit of creditors, appointment of
a receiver or trustee for all or any part of Borrower's or Guarantor's assets or
of the assets of any other guarantor of the Obligations, liquidation,
winding-up, or dissolution of Borrower or Guarantor, or any other guarantor of
the Obligations;
(c) any limitation, discharge, cessation, or partial
satisfaction of the Loan, the Guaranty Obligations, or the obligations of any
other guarantor of the Obligations, or any invalidity, voidability,
unenforceability, in whole or in part, of the Credit Agreement, this Guaranty,
any other Loan Document, or any other document evidencing the Loan or Guaranty
Obligations;
(d) any merger, acquisition, consolidation or change in
structure of Borrower or Guarantor or any other guarantor of the Obligations; or
any sale, lease, transfer, or other disposition of any or all of the assets or
Equity Interests of any Borrowers or Guarantor or any other guarantor of the
Obligations, including, without limitation, any transfer by Borrower of all or
any part of any Collateral, or termination of Borrower's existence for any
reason;
(e) any assignment or other transfer, in whole or in part,
of Lender's interest in or rights in or under the Credit Agreement, or any other
Loan Document, including, without limitation, this Guaranty, or with respect to
the Loan, the Guaranty Obligations, or the Collateral;
(f) any claim, defense, counterclaim, or setoff that
Borrower or Guarantor or any other guarantor of the Obligations may have or
assert, including, without limitation, any defense of incapacity, disability, or
lack of corporate, organizational or other authority to execute any document
relating to the Loan, the Guaranty Obligations, the Collateral, or any other
Guaranty, other than (i) upon the occurrence of the Guaranty Termination Date,
the defense of prior performance, or (ii) any defense based on any applicable
provision of the Uniform Commercial Code requiring that Collateral be disposed
of in a commercially reasonable manner;
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(g) any cancellation, renunciation or surrender of any
pledge, guaranty, or any debt instrument evidencing the Loan or the Guaranty
Obligations;
(h) the vote, claim, distribution, election, acceptance,
action, or inaction of
Lender in any bankruptcy or reorganization case related to the Loan, the
Guaranty Obligations, or the Collateral; or
(i) any other action or circumstances that might otherwise
constitute a defense available to, or a legal or equitable discharge of, any
surety, guarantor or Guarantor;
it being agreed that the Guaranty Obligations shall not be discharged until the
Guaranty Termination Date.
2.3 Demand by Lender. In addition to the terms set forth herein,
and in no manner imposing any limitation on such terms, if any of the
Obligations under the Credit Agreement are declared to be or otherwise becomes
immediately due and payable, then Guarantor, upon demand in writing therefor by
Lender, shall immediately pay the Guaranty Obligations to Lender. Payment by
Guarantor shall be made to Lender to be credited and applied to the Obligations,
in immediately available funds in lawful money of the United States of America
to an account designated by Lender or at the address set forth below the
signature of Lender hereto or at any other address that may be specified in
writing from time to time by Lender as provided herein. Any payment received by
Lender with respect to the Loan or other Obligations shall reduce the Guaranty
Obligations by the amount of such payment.
2.4 Guarantor Waivers. In addition to any other waivers contained
herein, Guarantor waives, agrees and acknowledges as follows and waives any
defense based upon or arising from the following:
(a) The Guaranty Obligations are the immediate, direct,
primary and absolute liabilities of Guarantor, and are independent of, and not
co-extensive with, the Loan, the other Obligations or the obligations of any
other guarantor of the Obligations. Guarantor expressly waives any right it may
have now or in the future to direct or affect the manner or timing of Lender's
enforcement of its rights or remedies. Guarantor expressly waives any right it
may have now or in the future to require Lender to, and Lender shall not have
any liability to, pursue or enforce first against any Borrower, any of the
properties or assets of any Borrower, the Collateral or any other security,
guaranty or pledge that may now or hereafter be held by Lender for the Loan or
for the Guaranty Obligations, or to apply such security, guaranty, or pledge to
the Loan or to the Guaranty Obligations. Guarantor shall remain liable for the
Guaranty Obligations, notwithstanding any judgment Lender may obtain against any
Borrower or Guarantor, any other guarantor of the Obligations, or any other
person or entity, or any modification, extension or renewal with respect
thereto. Lender shall not be under any liability to marshal any assets in favor
of Guarantor or in payment of any or all of the Loan or the Guaranty
Obligations.
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(b) Guarantor has entered into this Guaranty based solely
upon its independent knowledge of each Borrower's financial condition, and
Guarantor assumes full responsibility for obtaining any further information with
respect to Borrowers or the conduct of its business. Guarantor represents that
it is now, and during the terms of this Guaranty will be, responsible for
ascertaining the financial condition of Borrowers. Guarantor hereby waives any
duty on the part of Lender to disclose to Guarantor, and agrees that it is not
relying upon or expecting Lender to disclose to it, any fact known or hereafter
known by Lender relating to the operation or condition of any Borrower or its
business or relating to the existence, liability, or financial condition of any
other guarantor of the Obligations. Guarantor knowingly accepts the full range
of risk encompassed in a contract of continuing guaranty, which risk includes
the possibility that Borrowers may incur further indebtedness after a Borrower's
financial condition or its ability to pay debts as they mature has deteriorated.
(c) Except as specifically provided in this Guaranty or
applicable law, Guarantor waives, to the fullest extent permitted by applicable
law: (i) notice of the acceptance by Lender of this Guaranty, (ii) notice of the
existence, creation, payment, nonpayment, performance or nonperformance of all
or any of the Guaranty Obligations, (iii) presentment, demand and protest and
notice of presentment, dishonor, intent to accelerate, acceleration, protest,
default, nonpayment, maturity, release, compromise, settlement, extension or
renewal of any or all of the Loan Documents, notes, commercial paper, accounts,
contract rights, documents, instruments, chattel paper and guaranties at any
time held by Lender on which Guarantor may be liable in any way, and hereby
ratifies and confirms whatever Lender may do in this regard; (iv) all rights to
notice and a hearing prior to Lender's taking possession or control of, or to
Lender's replevy, attachment or levy upon, the Collateral or any bond or
security which might be required by any court prior to allowing Lender to
exercise any of its remedies; (v) all rights to receive notices from Lender with
respect to, or otherwise sent to, Guarantor or any other guarantor of the
Obligations, (vi) the benefit of all valuation, appraisal, stay, extension,
redemption and exemption laws, (vii) the benefit of any law purporting to reduce
Guarantor's obligation in proportion to the principal obligation hereby
guarantied, (viii) the benefit of any law purporting to exonerate Guarantor's
obligation upon performance or an offer of performance of the principal
obligation, (ix) notice of any extension, modification, renewal, or amendment of
any of the terms of the Credit Agreement or any other Loan Document relating to
the Loan or the Guaranty Obligations; (x) notice of the occurrence of any
Default or Event of Default with respect to the Loan, the Guaranty Obligations,
the Collateral or otherwise; and (xi) notice of any exercise or non-exercise by
Lender of any right, power, or remedy with respect to the Loan, the Guaranty
Obligations or the Collateral; provided, however, that the Lender shall provide
Guarantor with written notice of an Event of Default when and if Lender is
required to provide such notice to the Borrower under the Credit Agreement.
(d) If Lender, under applicable law, may proceed to realize
its benefits under any Loan Document providing for a lien upon any Collateral,
whether owned by a Borrower or by any other person or entity, either by judicial
foreclosure or by nonjudicial sale or enforcement, Lender, at its sole option,
may determine which of its remedies or rights it may pursue without affecting
any of its rights and remedies under this Guaranty.
(e) Guarantor represents that the Loan and Guaranty
Obligations are and shall be incurred by Borrowers for business and commercial
purposes only. Any claim of Lender against Guarantor arising out of this
Guaranty arises out of the conduct by Guarantor of its trade, business, or
profession. Guarantor undertakes all the risks encompassed in the Credit
Agreement and the other Loan Documents as they may be now or are hereafter
agreed upon by Lender and Borrowers. Prior to the Guaranty Termination Date,
Lender, in such manner and upon such terms and at such time as it deems best,
and with or without notice to Guarantor, may release, add, subordinate or
substitute security for the Loan or other Obligations.
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(f) A separate action or actions may be brought and
prosecuted against Guarantor whether or not an action is brought against any one
or more Borrowers, or whether any one or more Borrowers is joined in any such
action or actions.
2.5 Waivers Under Statutes. Guarantor makes the following waivers:
GUARANTOR WAIVES ALL RIGHTS AND DEFENSES THAT GUARANTOR MAY HAVE
BECAUSE THE OBLIGATIONS ARE SECURED BY REAL PROPERTY. THIS MEANS, AMONG OTHER
THINGS: (1) LENDER MAY COLLECT FROM GUARANTOR WITHOUT FIRST FORECLOSING ON ANY
REAL OR PERSONAL PROPERTY COLLATERAL; (2) IF LENDER FORECLOSES ON ANY REAL
PROPERTY COLLATERAL: (A) THE AMOUNT OF THE DEBT MAY BE REDUCED ONLY BY THE PRICE
FOR WHICH THAT COLLATERAL IS SOLD AT THE FORECLOSURE SALE, EVEN IF THE
COLLATERAL IS WORTH MORE THAN THE SALE PRICE; AND (B) LENDER MAY COLLECT FROM
GUARANTOR EVEN IF LENDER, BY FORECLOSING ON THE REAL PROPERTY COLLATERAL, HAS
DESTROYED ANY RIGHT GUARANTOR MAY HAVE TO COLLECT FROM BORROWER. THIS IS AN
UNCONDITIONAL AND IRREVOCABLE WAIVER OF ANY RIGHTS AND DEFENSES GUARANTOR MAY
HAVE BECAUSE EACH BORROWER'S DEBT IS SECURED BY REAL PROPERTY. THESE RIGHTS AND
DEFENSES INCLUDE, BUT ARE NOT LIMITED TO, ANY RIGHTS OR DEFENSES BASED UPON
SECTION 580a, 580b, 580d or 762 OF THE CALIFORNIA CODE OF CIVIL PROCEDURE
("CCP").
IN ADDITION, GUARANTOR WAIVES ALL RIGHTS AND DEFENSES ARISING OUT OF
AN ELECTION OF REMEDIES BY LENDER, EVEN THOUGH THAT ELECTION OF REMEDIES, SUCH
AS A NONJUDICIAL FORECLOSURE WITH RESPECT TO SECURITY FOR A GUARANTEED
OBLIGATION, HAS DESTROYED GUARANTOR'S RIGHTS BY THE OPERATION OF SECTION 580d OF
THE CCP OR OTHERWISE.
2.6 Additional Waivers.
(a) Guarantor waives any and all rights of subrogation,
reimbursement, indemnification, and contribution and any other rights and
defenses that are or may become available to Guarantor by reason of California
Civil Code Sections 2787 to 2855, inclusive, Sections 2899 and 3433, or other
statutory or decisional law. This means, among other things, that:
(i) Guarantor waives and will be unable to raise any
defense based upon any statute or rule of law which provides that the
obligation of a surety must be neither larger in amount nor in any other
respects more burdensome than that of a principal;
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(ii) Guarantor waives and will be unable to raise any
defense based upon any statute or rule of law which provides that a
creditor may be required to pursue the principal obligor or the security
for the principal obligation before seeking enforcement against a
guarantor or security pledged by the guarantor;
(iii) Guarantor waives and will be unable to raise any
defense based upon any statute or rule of law which provides that a
guarantor's obligations may be limited or exonerated by reason of the
creditor's alteration of the principal obligation or of another guaranty,
or by reason of the impairment or suspension of the creditor's rights or
remedies against the principal, another guarantor, or any security given
for the principal obligation or given for other guaranties;
(iv) Guarantor waives and will be unable to claim any
right to participate in, or the benefit of, any security given for the
principal obligation now or hereafter held by Lender; and (v) Guarantor
waives and will be unable to claim any right of subrogation and any right
to enforce any remedy which Lender may have against any one or more of the
Borrowers.
(b) Guarantor waives any defense based upon any lack of
authority of the officers, directors, partners, members, managers, or agents
acting or purporting to act on behalf of a Borrower or any principal of a
Borrower or any legal disability or defect in the formation of a Borrower.
(c) Guarantor waives any defense based upon the application
by any Borrower of the proceeds of the Loan for purposes other than the purposes
represented by such Borrower to Lender or intended or understood by Lender or
Guarantor.
(d) Guarantor waives the benefit of any statute of
limitations affecting the liability of Guarantor hereunder or the enforcement
hereof, and Guarantor further agrees that any act or event which tolls any
statute of limitations applicable to the obligations of any Borrower shall
similarly operate to toll the statute of limitations applicable to Guarantor's
liability hereunder.
(e) Guarantor waives any defense to the enforcement of the
Guaranty Obligations by Lender against Guarantor by virtue of the fact that
Guarantor has also executed and delivered to Lender a certain Environmental
Indemnity Agreement dated as of the date hereof pursuant to which Guarantor
indemnifies Lender against certain liabilities based on certain environmental
laws relating to the property sold by IHHI to Guarantor as described in the
Recitals to this Agreement.
(f) Guarantor further waives any and all defenses which are
comparable to the waivers set forth in this Guaranty which would otherwise be
available to Guarantor under Nevada law (whether based on a statute or
decisional law) and any other defenses available to guarantors under Nevada law,
whether based on a statute or decisional law.
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2.7 Benefits of Guaranty. The provisions of this Guaranty are for
the benefit of Lender and its successors, transferees, endorsees, and assigns,
and nothing herein shall impair the Loan or other Obligations, as between
Borrowers, Guarantor and Lender. No such transfer, endorsement, or assignment
shall increase or diminish any of the Guaranty Obligations hereunder. This
Guaranty binds Guarantor, and Guarantor may not assign, transfer or endorse this
Guaranty. In the event all or any part of the Loan or other Obligations are
transferred, endorsed or assigned by Lender to any Person or Persons, any
reference to "Lender" herein shall be deemed to refer equally to such Person or
Persons.
2.8 Continuing Guaranty. (a) This is a continuing guaranty,
(b) this Guaranty shall remain in full force and effect until the Guaranty
Termination Date, and (c) the Guaranty Obligations hereunder shall extend to
each and every extension or renewal, if any, of the Credit Agreement, regardless
of whether the Loan or other Obligations, in successive transactions, may be
paid, repaid, advanced or renewed from time to time.
2.9 Subordination. Any and all present and future debts and
obligations of any Borrower to Guarantor are hereby fully and absolutely
subordinated to the right and time of payment in full of the Obligations to
Lender under the Credit Agreement and the other Loan Documents. Any Lien, now
existing or hereafter arising, on or in any of the assets of any Borrower in
favor of Guarantor, whether created by contract, assignment, subrogation,
reimbursement, indemnity, operation of law, principles of equity or otherwise is
hereby subordinated in priority to the liens and security interests of Lender,
now existing or hereafter arising. The subordination provisions of this Section
2.9 shall be effective regardless of whether demand has been made by Lender and
shall remain in effect until the Guaranty Termination Date.
3. Representations and Warranties. To induce Lender to provide the
consideration to Borrowers and Guarantor described above, Guarantor hereby makes
the following representations and warranties, and each and all of which survive
the execution and delivery of this Guaranty:
3.1 Organization. Guarantor is duly formed and validly existing
under the laws of the state of its organization and has full power and authority
to enter into and perform its obligations under this Guaranty. Guarantor's
jurisdiction of organization and exact legal name are as set forth in the first
paragraph of this Guaranty.
3.2 Due Authorization. The execution, delivery and performance by
Guarantor of this Guaranty have been duly authorized by all necessary action of
Guarantor.
3.3 Binding Obligation. This Guaranty constitutes the legal, valid
and binding obligations of Guarantor, enforceable against Guarantor in
accordance with its terms.
3.4 No Conflicts. The execution, delivery, and performance by
Guarantor of this Guaranty does not contravene any law, organizational documents
of Guarantor or any contractual restriction binding on or affecting Guarantor,
and does not result in or require the creation of any Lien upon or with respect
to any of its properties.
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3.5 Consents. No authorization or approval, or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by Guarantor of this
Guaranty.
3.6 Articles of Organization and Operating Agreement. Guarantor
has furnished to Lender a true and correct copy of the Articles of Organization
and the Operating Agreement and all amendments thereto, and the Operating
Agreement constitutes the valid, binding and enforceable obligation of all
parties thereto, sets froth the entire agreement of the parties thereto with
respect to the subject matter thereof, has not been further amended or modified,
and remains in full force and effect.
3.7 Address and Location of Records. The address of Guarantor's
principal place of business and chief executive office (or residence, if
Guarantor is an individual) is accurately set forth on the signature page to
this Guaranty.
3.8 Solvency. Guarantor is now, and will be upon the consummation
of the transactions contemplated by this Guaranty and the other Loan Documents,
Solvent.
3.9 No Setoff, Defense, or Counterclaim. As of the date of this
Guaranty, the Guaranty Obligations are not subject to any setoff or defense of
any kind against Lender or any Borrower, and Guarantor specifically waives its
right to assert any such defense or right of setoff. The Guaranty Obligations
shall not be subject to any counterclaims, setoffs, or defenses against Lender
or any Borrower that may arise in the future, except for (a) any defense of
prior performance or payment, or (b) any defense based on any applicable
provision of the Uniform Commercial Code requiring that Collateral be disposed
of in a commercially reasonable manner, which any Borrower, Guarantor, or other
guarantor of the Obligations may have or assert.
4. Covenants. Guarantor covenants and agrees that until the Guaranty
Termination Date, Guarantor shall give prompt written notice to Lender (in any
event not later than 10 days prior to any change described below) of (a) any
change in the location of Guarantor's principal place of business, (b) any
change in the location of books and records pertaining to its business, (c) any
change in its jurisdiction of organization, (d) any change in its name,
identity, or structure in any manner which might make any financing statement
filed hereunder incorrect or misleading.
5. Further Assurances. Guarantor agrees that, at its expense, upon the
written request of Lender, it will promptly execute and deliver to Lender any
additional instruments or documents reasonably considered necessary by Lender to
cause this Guaranty to be, become, or remain valid and effective in accordance
with its terms. Guarantor will provide Lender in writing such financial and
other information with respect to its assets and liabilities as Lender shall
request, in form reasonably satisfactory to Lender.
6. Reinstatement. This Guaranty shall remain in full force and effect
and continue to be effective, as the case may be, if at any time payment or
performance of the Loan or the Guaranty Obligations, or any part thereof,
pursuant to applicable law, is avoided, rescinded, or reduced in amount, or must
otherwise be restored or returned by Lender, or any other obligee of the Loan or
the Guaranty Obligations, whether as a "voidable preference," "fraudulent
conveyance" or otherwise, all as though such payment or performance had not been
made. In the event that any payment, or any part thereof, is avoided, rescinded,
reduced, restored or returned, the Loan or the Guaranty Obligations, as the case
may be, shall be reinstated and deemed reduced only by such amount paid and not
so avoided, rescinded, reduced, restored or returned.
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7. Defaults and Remedies. Upon the occurrence and during the
continuance of an Event of Default under the Credit Agreement, Lender may
declare any or all of the Guaranty Obligations, immediately and without demand,
notice or legal process of any kind, to be, and such Guaranty Obligations shall
immediately become, due and payable, and then, or at any subsequent time, Lender
may exercise any or all of its rights and remedies under this Guaranty, the
Credit Agreement, and any other Loan Documents, including the exercise of any
rights and remedies of Lender as a secured party against the Collateral, and
under applicable law, and in addition may make demand upon Guarantor for the
payment of the Guaranty Obligations; provided, that upon the occurrence of an
Event of Default specified in Sections 8.1(a) and (b) of the Credit Agreement,
the Guaranty Obligations shall become immediately due and payable without
declaration, notice or demand by Lender. All Guaranty Obligations shall bear
interest at the Default Rate from and after the date an Event of Default occurs
under the Credit Agreement.
8. Application of Payments. Any payment made by Guarantor under this
Guaranty shall be applied by Lender first, to the satisfaction of the
indemnification liabilities pursuant to Section 9 and then, as set forth in the
Credit Agreement.
9. Indemnification. Guarantor shall indemnify and hold Lender, and its
respective officers, directors, employees, agents and representatives harmless
from and against any liabilities, claims and damages, including, without
limitation, reasonable costs, attorneys' fees, disbursements and other expenses
incurred or arising by reason of the taking or the failure to take action by
Lender, in good faith, in respect of any transaction effected under this
Guaranty, including, without limitation, any action to enforce payment of the
Guaranty Obligations. The liabilities of Guarantor under this Section 9 shall
survive the termination of this Guaranty.
10. Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other parties, or whenever any of the parties desires to give or
serve upon any other parties any communication with respect to this Guaranty,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be deemed to have been validly
served, given or delivered (a) upon the earlier of actual receipt and three (3)
Business Days after deposit in the United States Mail registered or certified
mail, return receipt requested, with proper postage prepaid, (b) upon
confirmation of transmission, when sent by telecopy or other similar facsimile
transmission (with such telecopy or facsimile promptly confirmed by delivery of
a copy by personal delivery or United States Mail as otherwise provided in this
Section 10), (c) one (1) Business Day after deposit with a reputable overnight
courier with all charges prepaid or (d) when delivered, if hand-delivered by
messenger, all of which shall be addressed to the party to be notified and sent
to the address or facsimile number indicated below such party's signature to
this Guaranty or to such other address (or facsimile number) as may be
substituted by notice given as herein provided. The giving of any notice
required hereunder may be waived in writing by the party entitled to receive
such notice.
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11. Entire Agreement. This Guaranty, together with the other Loan
Documents constitutes the entire agreement, and supersedes all prior and
contemporaneous oral and written communications and agreements, between the
parties with respect to the subject matter hereof.
12. Limitation of Liability. Neither Lender nor any of its officers,
directors, employees, agents, or counsel, shall be liable for any action
lawfully taken or omitted to be taken by it or them hereunder or in connection
herewith, except for its or their own respective gross negligence or willful
misconduct.
13. Advice of Counsel. Guarantor represents and warrants that it has
either obtained the advice of counsel or has had the opportunity to obtain such
advice in connection with the terms and provisions of this Guaranty.
14. Amendments. No amendment or waiver of any provisions of this
Guaranty, or consent to any departure by Guarantor therefrom, shall be effective
in any event unless the same shall be in writing and signed by Lender and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
15. Consent to Loan Documents. Guarantor hereby acknowledges it has
received copies of, and consents to, the Credit Agreement and all of the Loan
Documents.
16. No Waiver. No failure on the part of Lender or Lender to exercise,
and no delay in exercising, any right under any Loan Document shall operate as a
waiver thereof; and no single or partial exercise of any right under any Loan
Document shall preclude any other or further exercise thereof or the exercise of
any other right. The remedies provided in the Loan Documents are cumulative and
not exclusive of any remedies provided by law.
17. Binding Effect. This Guaranty shall be binding upon and inure to
respective benefits of Lender and Guarantor and their respective successors and
assigns, except that Guarantor shall not have the right to assign its rights
hereunder or any interest herein without Lender's prior written consent.
18. Severability. In the event that any one or more of the provisions
contained in any of the Loan Documents shall be determined to be invalid,
illegal, or unenforceable in any respect for any reason, the validity, legality,
and enforceability of any such provision or provisions in every other respect,
and the remaining provisions of such Loan Document, shall not be in any way
impaired.
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19. Governing Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THE LOAN DOCUMENTS AND THE OBLIGATIONS
SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEVADA APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE AND
ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. GUARANTOR AND LENDER HEREBY
CONSENT AND AGREE THAT THE STATE OR FEDERAL COURTS LOCATED IN THE STATE OF
NEVADA, CLARK COUNTY, CITY OF LAS VEGAS, SHALL HAVE EXCLUSIVE JURISDICTION TO
HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN GUARANTOR AND LENDER
PERTAINING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS;
PROVIDED, THAT LENDER AND GUARANTOR ACKNOWLEDGE THAT ANY APPEALS FROM THOSE
COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF CLARK COUNTY, NEVADA;
PROVIDED FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO
PRECLUDE LENDER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER
JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF LENDER.
GUARANTOR AND LENDER EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND GUARANTOR
AND LENDER HEREBY WAIVE ANY OBJECTION THAT SUCH GUARANTOR OR LENDER MAY HAVE
BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS
AND HEREBY CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS
DEEMED APPROPRIATE BY SUCH COURT. GUARANTOR AND LENDER HEREBY WAIVE PERSONAL
SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR
SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY
BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO GUARANTOR OR TO LENDER AT
THE ADDRESS SET FORTH BELOW AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED
UPON THE EARLIER OF GUARANTOR'S OR LENDER'S ACTUAL RECEIPT THEREOF OR THREE (3)
DAYS AFTER DEPOSIT IN THE UNITED STATES MAILS, PROPER POSTAGE PREPAID.
20. Waiver of Trial By Jury. Guarantor and Lender each hereby
irrevocably waives all right to trial by jury in any action, proceeding or
counterclaim arising out of or relating to this Guaranty, any other Loan
Document, or any of the transactions contemplated thereby.
21. Suretyship Waivers. The suretyship waivers contained in Article 12
of the Credit Agreement shall be applicable to this Agreement and to all other
Loan Documents and be deemed to be remade by Guarantor.
22. Counterparts. This Guaranty may be executed in any number of
identical counterparts, which shall constitute an original and collectively and
separately constitute a single instrument or agreement.
IN WITNESS WHEREOF, Guarantor has executed and delivered this
Guaranty as of the date first above written.
PACIFIC COAST HOLDINGS INVESTMENT, LLC
a California limited liability company
By:
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[Printed Name]
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[Title]
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