Exhibit 10.5
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this "Guaranty Agreement"), dated as of December
29, 2005, is by TelePlus Enterprises, Inc., a Nevada corporation (the
"Guarantor"), in favor of Star Number, Inc., a Delaware corporation (the
"Vendor").
WHEREAS, TelePlus Wireless, Corp., a Nevada corporation and wholly-owned
subsidiary of the Guarantor (the "Purchaser"), has acquired certain of the
assets of the Vendor pursuant to an Asset Purchase Agreement (the "Purchase
Agreement") dated December 29, 2005, by and between the Vendor and the
Purchaser; and
WHEREAS, in connection with the closing of the transactions contemplated
by the Purchase Agreement, the Purchaser will execute and deliver a secured
promissory note in favor of the Vendor in the principal amount of Five Hundred
Thousand Dollars ($500,000.00) (the "Note") and it is a condition of the
Purchase Agreement that the Guarantor provide a guarantee to the Vendor of the
Obligations (as defined below) of the Purchaser under the Note;
NOW, THEREFORE, in consideration of the foregoing and in exchange for good
and valuable consideration, both the receipt and legal sufficiency of which are
hereby acknowledged, the Guarantor hereby agrees as follows:
1. Subject to Section 2, the Guarantor hereby unconditionally and
absolutely guarantees to the Vendor payment when due of all amounts owing by the
Purchaser to the Vendor under the Note (all such payment obligations being
referred to herein as the "Obligations"). Upon written notice of any failure of
the Purchaser promptly to pay when due of any sum of money owing under the Note,
the Guarantor shall promptly pay such Obligation.
2. The Guarantor acknowledges and agrees that this Guaranty Agreement is a
primary and unconditional obligation, and this Guaranty Agreement is
irrevocable. Notwithstanding anything in this Guaranty Agreement to the
contrary, the Guarantor shall have no obligation to the Vendor beyond the
obligations of the Purchaser under the Note, it being understood that the
obligations of the Purchaser under the Note, and the Guarantor's obligations
under this Guaranty Agreement, are expressly limited by the terms of the
Purchaser's rights of recoupment and set-off contained in the Note and in the
Purchase Agreement.
3. The Guarantor hereby represents and warrants that this Guaranty
Agreement has been duly authorized, executed and delivered and constitutes a
legal, valid and binding obligation of the Guarantor, enforceable in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization and other laws of general application limiting the enforcement of
creditors' rights generally and to the fact that specific performance is an
equitable remedy available only in the discretion of the court, and the
execution and delivery of this Guaranty Agreement does not contravene the
provisions of, or create a default under, any material agreement or instrument
to which the Guarantor is a party or by which the Guarantor is bound, except as
disclosed in Schedule "A" hereto and for which the Guarantor undertakes to
obtain a waiver within thirty (30) days of the date hereof..
4. The Guarantor agrees that its liabilities and obligations hereunder
shall not be impaired, modified, changed, released or limited in any manner
whatsoever by any impairment, modification, change, release or limitation of the
liability of the Purchaser in bankruptcy as a result of the operation of any
present or future provision of the bankruptcy laws or other similar statutes.
The Guarantor's obligations hereunder shall not be affected or limited in any
way by any change in the status of the Purchaser, including any dissolution or
liquidation of the Purchaser.
5. The Guarantor waives notice of acceptance of this Guaranty, and
presentment, demand, protest, notice of protest and diligence in collecting any
Obligations. Guarantor acknowledges and agrees that the liabilities created by
this Guaranty Agreement are direct and are not conditioned upon pursuit by the
Vendor of any remedy the Vendor may have against the Purchaser or any other
person or any security. No invalidity, irregularity or unenforceability by
reason of any bankruptcy, insolvency or other similar law, or any law or order
of any government or agency thereof purporting to reduce, amend or otherwise
affect the Obligations shall impair, affect or be a defense to the obligations
of the Guarantor under this Guaranty Agreement.
6. The Guarantor delivers this Guaranty Agreement based solely on the
Guarantor's independent investigation of the financial condition of the
Purchaser and is not relying on any information furnished by the Vendor. The
Guarantor assumes full responsibility for obtaining any further information
concerning the Purchaser's financial condition, the status of the obligations or
any other matter which the Guarantor may deem necessary or appropriate from time
to time. The Guarantor hereby waives any duty on the part of the Vendor, and
agrees that it is not relying upon nor expecting the Vendor to disclose to the
Guarantor any fact now or hereafter known by the Vendor, whether relating to the
operations or condition of the Purchaser, the existence, liabilities or
financial condition of any co-guarantor of the Obligations, the occurrence of
any default with respect to the Obligations, or otherwise, notwithstanding any
effect such fact may have upon the Guarantor's risk hereunder or the Guarantor's
rights against the Purchaser. The Guarantor knowingly accepts the full range of
risk encompassed in this Guaranty Agreement.
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7. The Vendor shall have no duty to enforce or protect any rights which
the Guarantor may have against the Purchaser, and the Guarantor assumes full
responsibility for enforcing and protecting any such rights.
8. If after receipt of any payment of all or any part of the Obligations,
the Vendor is for any reason compelled to surrender such payment to any person
or entity, because such payment is determined to be void or voidable as a
preference, impermissible setoff, diversion of trust funds or for any other
reason, then to the extent of that payment, the Obligations shall be revived and
the obligations under this Guaranty Agreement shall be continued in effect
without reduction or discharge for that payment, and this Guaranty Agreement
shall continue in full force notwithstanding any contrary action which may have
been taken by the Vendor in reliance upon such payment, and any such contrary
action so taken shall be without prejudice to the Vendor's rights under this
Guaranty Agreement and shall be deemed to have been conditioned upon such
payment having become final and irrevocable.
9. Any notice required or permitted under this Agreement shall be given in
accordance with Section 15.9 of the Purchase Agreement; provided that any notice
to the Guarantor shall be sent to the Purchaser and to:
TelePlus Enterprises, Inc.
7575 TransCanada
Suite 305
St-Laurent, Quebec, H4T 1V6
Fax: (514) 344-8675
Attention: Marius Silvasan, CEO
10. This Guaranty Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and assigns. The
Guarantor's obligations under this Guaranty Agreement may not be assigned
without the prior written consent of the Vendor. If any part of this Guaranty
Agreement is adjudged invalid, then such partial invalidity shall not cause the
remainder of this Guaranty Agreement to be or to become invalid. The
interpretation and performance of this Guaranty Agreement shall be governed by
the laws of the State of Delaware (without reference to the choice of law
provisions of the State of Delaware).
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IN WITNESS WHEREOF, this Guaranty Agreement has been duly executed by the
undersigned as of the date first above written.
ATTEST: TELEPLUS ENTERPRISES, INC.
By: /s/ Marius Silvasan
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Secretary Name:
------------------------------
Title:
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I have the authority to bind the
Corporation
ATTEST: STAR NUMBER, INC.
By: /s/ Frank C. Bennett
- -------------------------------- --------------------------------
Secretary Name:
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Title:
-----------------------------
I have the authority to bind the
Corporation
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SCHEDULE "A"
Under the terms of the secured convertible debentures issued to Cornell Capital
Partners, LP by the Guarantor on December 13, 2005, and related agreements, the
Guarantor has undertaken not to incur indebtedness in excess of $100,000.
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