EXHIBIT 10.11
-------------
GUARANTY AGREEMENT
From
DYNAGEN, INC.,
as Guarantor,
To
NEW JERSEY ECONOMIC DEVELOPMENT AUTHORTY
Dated as of June 1, 1999
New Jersey Economic Development Authority
Industrial Development Revenue Bonds
(Able Laboratories, Inc. Project) Series 1999A
and
New Jersey Economic Development Authority
Industrial Development Revenue Bonds
(Able Laboratories, Inc. Project) (Taxable) Series 1999B
TABLE OF CONTENTS
Page
----
ARTICLE I - REPRESENTATIONS AND WARRANTIES OF THE GUARANTOR....................3
SECTION 1.1. REPRESENTATIONS AND WARRANTIES OF THE GUARANTOR................3
ARTICLE II - AGREEMENT TO GUARANTEE...........................................4
Section 2.1. Obligations Guaranteed.........................................4
Section 2.2. Obligations Unconditional......................................5
Section 2.3. No Waiver or Set-Off...........................................7
Section 2.4. Events of Default..............................................7
Section 2.5. Waiver of Notice: Expenses.....................................9
Section 2.6. Benefit and Enforcement........................................9
Section 2.7. Survival of Guarantee Obligation...............................9
Section 2.8. Waiver of Rights...............................................9
ARTICLE III - NOTICE OF SERVICE OF PROCESS, PLEADINGS AND OTHER PAPER........10
Section 3.1. Service of Process............................................10
Section 3.2. Notices.......................................................10
Section 3.3. Consent to Jurisdiction.......................................10
ARTICLE IV - MISCELLANEOUS...................................................12
Section 4.1. No Alteration Without Consent.................................12
Section 4.2. Guaranty Agreement to Become Effective........................12
Section 4.3. Remedies Not Exclusive........................................12
Section 4.4. Entire Agreement: Counterparts................................12
Section 4.5. Severability..................................................12
Section 4.6. Release.......................................................12
Section 4.7. Applicable Law................................................13
Section 4.8. Successors and Assigns........................................13
Section 4.9. Date of Guaranty Agreement for Reference Purposes Only........13
Section 4.10. Assignment by Authority to Trustee...........................13
-i-
GUARANTY AGREEMENT
This GUARANTY AGREEMENT made and entered into as of June 1, 1999 (the
"Guaranty Agreement") (capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Indenture or in the Loan Agreement, as each
is defined herein), from DYNAGEN, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Guarantor"), having an office at
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, party of the first part, to NEW
JERSEY ECONOMIC DEVELOPMENT AUTHORITY, a body corporate and politic organized
and validly existing under the laws of the State of New Jersey (the "Authority")
having an office at ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, party of the
second part:
WITNESSETH:
WHEREAS, the Authority intends to issue its Industrial Development
Revenue Bonds (Able Laboratories, Inc. Project) Series 1999A in the aggregate
principal amount of $1,700,000 (the "Series 1999A Bonds") and its Industrial
Development Revenue Bonds (Able Laboratories, Inc. Project) (Taxable) Series
1999B in the aggregate principal amount of $300,000 (the "Series 1999B Bonds"
and together with the Series 1999A Bonds, the "Series 1999 Bonds"); and
WHEREAS, the Series 1999 Bonds are to be issued pursuant to the New
Jersey Economic Development Authority Act, constituting Chapter 80 of the
Pamphlet Laws of 1974 of the State of New Jersey, as amended and supplemented,
resolution of the Authority adopted on April 13, 1999, May 11, 1999 and June 8,
1999 and an Indenture of Trust of even date herewith (the "Indenture") between
the Authority and the U.S. Bank Trust National Association, as trustee (the
"Trustee"); and
WHEREAS, the proceeds derived from the issuance of the Series 1999
Bonds are to be used to finance (i) the acquisition of machinery and equipment
for an existing manufacturing facility located in South Plainfield, New Jersey;
(ii) the payment of the issuance costs incurred by the Guarantor's wholly owned
subsidiary, Able Laboratories, Inc. (the "Borrower") for the Series 1999 Bonds;
(iii) the funding of a lease reserve fund; and (iv) the funding of a debt
service reserve fund for the Series 1999 Bonds (collectively, the "Project");
and
WHEREAS, Borrower is unconditionally obligated under the Loan Agreement
dated as of June 1, 1999 by and between the Authority and the Borrower (the
"Loan Agreement") to pay amounts sufficient for the Authority to pay principal
of, premium, if any, and interest on the Series 1999 Bonds; and
WHEREAS, the Guarantor is desirous that the Authority issue, sell and
deliver the Series 1999 Bonds and apply the proceeds as aforesaid and enter into
the Loan Agreement with the Guarantor and the Guarantor is willing to enter into
this Guaranty Agreement in order to enhance the marketability of the Series 1999
Bonds and thereby achieve interest cost and other savings to
the Borrower as an inducement to the purchase of the Series 1999 Bonds by all
who shall at any time become the holders of the Series 1999 Bonds.
NOW, THEREFORE, in consideration of the premises, and for other good
and valuable consideration received, the Guarantor does hereby represent,
warrant, covenant and agree with the Authority as follows:
-2-
ARTICLE I
REPRESENTATIONS AND WARRANTIES OF
THE GUARANTOR
Section 1.1. Representations and Warranties of the Guarantor. The
Guarantor does hereby represent and warrant as follows:
(a) The Guarantor is a corporation duly organized and validly
existing under the laws of the State of Delaware, has the corporate power and
authority to own its property and assets, to carry on its business as now being
conducted by it and to execute, deliver and perform this Guaranty Agreement.
(b) The execution, delivery and performance by the Guarantor
of this Guaranty Agreement and the consummation of the transactions herein
contemplated by the Guarantor have been duly authorized by all requisite
corporate action on the part of the Guarantor and will not violate (i) any
applicable provision of law, or any order of any court or agency of government
having jurisdiction thereover, (ii) the articles of incorporation or by-laws of
the Guarantor, or (iii) any indenture, agreement or other instrument to which
the Guarantor is a party or by which it or any of its property is bound, or be
in conflict with or result in a breach of or constitute (with due notice and/or
lapse of time) a default under any such indenture, agreement or other instrument
which violation, conflict, breach or default would have a material adverse
effect upon the worldwide affairs, assets, properties, business or condition,
financial or otherwise, of the Guarantor.
(c) This Guaranty Agreement constitutes the legal, valid and
binding obligation of the Guarantor enforceable against the Guarantor in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or relating
to the enforcement of creditors' rights generally and to general equitable
principles.
(d) There is no action or proceeding pending or to the best
knowledge of the Guarantor threatened by or against the Guarantor by or before
any court or administrative agency that would materially adversely affect the
legality, validity or enforceability of, or the ability of the Guarantor to
perform its obligations under this Guaranty Agreement and all authorizations,
consents and approvals of governmental bodies or agencies required to be
obtained by the Guarantor as of the date hereof in connection with the execution
and delivery of this Guaranty Agreement or in connection with the performance of
the obligations of the Guarantor hereunder have been obtained.
(e) The assumption by the Guarantor of its obligations under
this Guaranty Agreement will result in a direct financial benefit to the
Guarantor, as the corporate parent of the Borrower.
-3-
ARTICLE II
AGREEMENT TO GUARANTEE
Section 2.1. Obligations Guaranteed.
(a) The Guarantor hereby unconditionally guarantees to the
Authority, for the benefit of the Bondholders, (1) the full and prompt payment
of the principal of the Series 1999 Bonds and the indebtedness represented
thereby, and the redemption premium, if any, on the Series 1999 Bonds when and
as the same shall become due and payable, whether at the stated maturity
thereof, by acceleration, call for redemption or otherwise; (2) the full and
prompt payment of interest on the Series 1999 Bonds when and as the same shall
become due and payable; and (3) the full and prompt performance of all
obligations of the Borrower under the Loan Agreement, the Note and the Mortgage.
The payment and performance obligations guaranteed in the preceding sentence are
collectively referred to herein as the "Guaranteed Obligations". The Guarantor
further hereby irrevocably and unconditionally agrees that, subject to any
applicable cure or grace periods, upon any default in any of the Guaranteed
Obligations, the Guarantor will promptly pay and/or perform the same as
applicable. All payments by the Guarantor shall be paid in lawful money of the
United States of America. Each and every default in any of the Guaranteed
Obligations shall give rise to a separate cause of action hereunder, and
separate suits may be brought hereunder as each cause of action arises.
(b) The Guarantor further agrees that this Guaranty Agreement
constitutes an absolute, unconditional, present and continuing guarantee of
payment and performance and not of collection, and waives any right to require
that any resort be had by the Authority to (1) any security held by or for the
benefit of the Authority or the Trustee for any of the Guaranteed Obligations,
(2) the Authority's or the Trustee's rights against any other Person, or (3) any
other right or remedy available to the Authority or the Trustee by contract,
applicable law or otherwise. The obligations of the Guarantor under this
Guaranty Agreement are direct, unconditional and completely independent of the
obligations of any other Person, and a separate cause of action or separate
causes of action may be brought and prosecuted against the Guarantor without the
necessity of joining the Authority, the Trustee or any other party or previously
proceeding with or exhausting any other remedy against any other Person who
might have become liable for any of the Guaranteed Obligations or of realizing
upon any security held by or for the benefit of the Authority or the Trustee.
(c) Reference is made to Article X of the Indenture which
provides that, subject to certain conditions, the Indenture may be discharged
prior to the date on which all of the Series 1999 Bonds have become due and
payable if there shall be deposited with the Trustee an amount sufficient to pay
the entire principal of, redemption premium, if any, and interest due and to
become due on such Series 1999 Bonds on or prior to the maturity or redemption
thereof together with all other expenses. If any lien, encumbrance or charge
based on any claim of any kind (including, without limitation, any claim for
income, franchise or other taxes, whether Federal, state or otherwise but
excluding any claim against any Bondholder) shall be asserted or filed against
any moneys so deposited with the Trustee (or the income therefrom) so as to:
-4-
(1) interfere with the due application by the Trustee
of such moneys to the payment of the Series 1999 Bonds pursuant to the
applicable provisions of the Indenture, or
(2) subject the Holders of the Series 1999 Bonds to
any obligation to refund any moneys applied to payment of the Series
1999 Bonds,
then the Guarantor promptly will take, or cause the taking of, such action
(including, but not limited to, the payment of money) as may be necessary to
prevent, or to nullify the cause or result of, such interference or such
obligation, as the case may be.
Section 2.2. Obligations Unconditional. The obligations of the
Guarantor under this Guaranty Agreement shall be absolute and unconditional, and
shall remain in full force and effect until the Guaranteed Obligations shall
have been paid in full, performed or provided for, and all costs, Authority's
fees, Trustee's fees and commissions and expenses, if any, referred to in
Section 2.7 hereof shall have been paid in full, and, to the extent permitted by
law, such obligations shall not be affected, modified, released or impaired by
any state of facts or the happening from time to time of any event, including,
without limitation, any of the following, whether or not with notice to, or the
consent of, the Guarantor:
(a) the invalidity, irregularity, illegality or
unenforceability of, or any defect in, the Loan Agreement, the Indenture, the
Note or the Series 1999 Bonds;
(b) any present or future law or order of any government (de
jure or de facto) or of any agency thereof purporting to reduce, amend or
otherwise affect the Series 1999 Bonds or any other obligation of the Authority
or any other obligor or to vary any terms of payment;
(c) any claim of immunity on behalf of the Authority or any
other obligor or with respect to any property of the Authority or any other
obligor;
(d) the waiver, compromise, settlement, release, extension,
indulgence, change, modification or termination of any or all of the
obligations, covenants or agreements of any obligor under the Indenture, the
Loan Agreement, the Note or the Series 1999 Bonds or of the payment, performance
or observance thereof, or the impossibility of performance or unenforceability,
invalidity, irregularity or illegality of any of such obligations, covenants or
agreements;
(e) the failure to give notice to the Guarantor or any obligor
under this Guaranty Agreement, the Indenture, the Loan Agreement, the Note or
the Series 1999 Bonds of the occurrence of any Event of Default under the terms
and provisions of any of such documents (except as may be specifically provided
in any of such documents);
(f) the actual or purported assignment, subleasing or
mortgaging of all or any part of the interest of the Authority or the Borrower
in the Project or any failure of title or interest with respect to the
Borrower's or the Authority's interest in the Project;
-5-
(g) the actual or purported assignment of any of the
obligations, covenants and agreements contained in the Indenture, the Loan
Agreement, the Note, the Series 1999 Bonds or this Guaranty Agreement;
(h) the receipt and acceptance by the Trustee or the Authority
of notes, checks or other instruments for the payment of money made by the
Borrower or any other obligor under any of the documents executed in connection
with the Series 1999 Bonds and any extensions and renewals thereof;
(i) the extension of the time for payment of the principal of,
redemption premium, if any, or interest on the Series 1999 Bonds or any other
amounts that are due or may become due under the Series 1999 Bonds, the Loan
Agreement, the Note or the Mortgage, or of the time for performance of any other
obligations, covenants or agreements under or arising out of the Series 1999
Bonds or any of such documents or any extension or renewal thereof;
(j) the modification or amendment (whether material or
otherwise) of any duty, obligation, covenant or agreement set forth in the
Series 1999 Bonds, the Indenture, the Loan Agreement, the Note or the Mortgage;
(k) the taking of or the omission to take any action referred
to in the Series 1999 Bonds, the Loan Agreement, the Indenture, the Note, the
Mortgage or in this Guaranty Agreement;
(1) any failure, omission, delay or lack on the part of the
Authority, the Trustee or any other Person to enforce, assert or exercise any
right, power or remedy conferred on the Authority, the Trustee or such other
Person in this Guaranty Agreement, the Indenture, the Loan Agreement, the
Mortgage, the Note or the Series 1999 Bonds or any other act or acts on the part
of the Authority, the Trustee or the Holders from time to time of the Series
1999 Bonds;
(m) the voluntary or involuntary liquidation, dissolution,
merger, consolidation, sale or other disposition of all or substantially all the
assets, marshalling of assets and liabilities, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition with creditors or readjustment of, or other similar
proceedings affecting the Guarantor, the Borrower, the Authority or any obligor
under any of the documents executed in connection with the Series 1999 Bonds or
any or all of the assets of any of them, or any allegation or contest of the
validity of this Guaranty Agreement, the Indenture, the Loan Agreement, the
Note, the Mortgage or the Series 1999 Bonds in any such proceeding;
(n) to the extent permitted by law, the release or discharge
of the Guarantor from the performance or observance of any obligation, covenant
or agreement contained in this Guaranty Agreement by operation of law;
(o) the default or failure of the Guarantor fully to perform
any of its obligations set forth in this Guaranty Agreement;
-6-
(p) any release or impairment of the security pledged under
the Indenture, the Loan Agreement, the Note, the Mortgage or the Series 1999
Bonds;
(q) the release, substitution or replacement in accordance
with the terms of the Loan Agreement of any property subject thereto or any
redelivery, repossession, surrender or destruction of any such property, in
whole or in part;
(r) any limitation on the liability or obligations of the
Borrower, the Guarantor, the Trustee, the Authority or any obligor under any of
the documents executed in connection with the Series 1999 Bonds, or any
termination, cancellation or frustration, in whole or in part, of any document
executed in connection with the Series 1999 Bonds or any term thereof, or the
Series 1999 Bonds;
(s) any failure of the Authority or the Trustee to mitigate
damages resulting from any default by any obligor under any of the documents
executed in connection with the Series 1999 Bonds;
(t) the merger or consolidation of any obligor under any of
the documents executed in connection with the Series 1999 Bonds into or with any
other Person, or any sale, lease or transfer of any or all of the assets of any
such obligor to any Person;
(u) any other circumstances which might otherwise constitute a
legal or equitable discharge or defense of a surety or a guarantor (other than
performance by the Guarantor of its obligations hereunder); or
(v) any other occurrence whatsoever, whether similar or
dissimilar to the foregoing.
Section 2.3. No Waiver or Set-Off. No act of commission or omission of
any kind or at any time upon the part of the Authority or the Trustee in respect
of any matter whatsoever shall in any way impair the rights of the Authority to
enforce any right, power or benefit under this Guaranty Agreement and no
set-off, counterclaim, reduction, or diminution of any obligation, or any
defense of any kind or nature (other than performance by the Guarantor of its
obligations hereunder), which the Guarantor or any other obligor under any of
the documents executed in connection with the Series 1999 Bonds has or may have
against the Authority or the Trustee shall be available hereunder to the
Guarantor. Nothing herein shall prevent the commencement of a separate action by
the Guarantor or the interposition of a mandatory counterclaim.
Section 2.4. Events of Default. An "Event of Default" shall exist if
any of the following occurs and is continuing:
(a) the Guarantor defaults in any payment of amounts due under
hereunder and such default continues for more than two (2) business days after
written notice has been given to the Guarantor by the Authority or the Trustee
of the occurrence of an Event of Default under the Indenture or under any other
document executed in connection with the Series 1999 Bonds;
-7-
(b) the Guarantor fails to observe and perform any covenant,
condition or agreement (other than as referred to in Section 2.4(a) above) of
this Guaranty Agreement and (i) continuance of such default or failure for more
than thirty (30) days after written notice of such default or failure has been
given to the Guarantor by the Authority or the Trustee, or (ii) if by reason of
the nature of such default or failure the same can be remedied, but not within
the said thirty (30) days, the Guarantor fails to proceed with reasonable
diligence after receipt of said notice to cure the same or fails to continue
with reasonable diligence its efforts to cure the same;
(c) any warranty, representation or other statement made or
given by or on behalf of the Guarantor to the Authority, the Trustee or the
initial purchaser of the Series 1999 Bonds contained in this Guaranty Agreement
or in any of the other documents executed in connection with the Series 1999
Bonds is false, misleading or incorrect in any material respect as of the date
made;
(d) the Guarantor shall (i) apply for or consent to the
appointment of or the taking of possession by a receiver, liquidator, custodian
or trustee of itself or of all or a substantial part of its property, (ii) admit
in writing its inability, or be generally unable, to pay its debts as such debts
generally become due, (iii) make a general assignment for the benefit of its
creditors, (iv) commence a voluntary case under the Federal Bankruptcy Code (as
now or hereafter in effect), (v) file a petition seeking to take advantage of
any other law relating to bankruptcy, insolvency, rehabilitation,
reorganization, winding-up, or composition or adjustment of debts, (vi) fail to
controvert in a timely or appropriate manner, or acquiesce in writing to, any
petition filed against itself in an involuntary case under such Bankruptcy Code
(or under any other laws referenced in clause (v) above), (vii) take any action
for the purpose of effecting any of the foregoing, or (viii) be adjudicated a
bankrupt or insolvent by any court of competent jurisdiction; or
(e) a proceeding or case shall be commenced, without the
application or consent of the Guarantor, in any court of competent jurisdiction,
seeking, (i) liquidation, reorganization, dissolution, winding-up or composition
or adjustment of debts, (ii) the appointment of a trustee, receiver, liquidator,
custodian or the like of the Guarantor or of all or any substantial part of its
assets, or (iii) similar relief under any law relating to bankruptcy,
insolvency, rehabilitation, reorganization, winding-up or composition or
adjustment of debts, and such proceeding or case shall continue undismissed, or
an order, judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect, for a period of sixty (60) days; or
the Guarantor shall consent in writing to any of the foregoing; or any order for
relief against the Guarantor shall be entered in an involuntary case under the
Federal Bankruptcy Code.
Upon an Event of Default the Authority and the Trustee shall have the
right to proceed first and directly against the Guarantor under this Guaranty
Agreement without proceeding against or exhausting any other remedies which it
may have and without resorting to any security held by the Trustee or by any
obligor under any of the documents executed in connection with the Series 1999
Bonds. All moneys recovered by the Authority or the Trustee pursuant to this
-8-
Guaranty Agreement shall be deposited in accordance with the Indenture and used
and applied in accordance with the Indenture.
The Authority and the Trustee shall be under no obligation to institute
any suit or to take any remedial action under this Guaranty Agreement, or to
enter any appearance or in any way defend in any suit in which it may be made
defendant, or to take any steps in the enforcement of any rights and powers
under this Guaranty Agreement, until it shall be indemnified to its satisfaction
against any and all liability (including, without limitation, reasonable
compensation for services, costs and expenses, outlays, and counsel fees and
other disbursements) not due to its gross negligence or willful misconduct.
Section 2.5. Waiver of Notice: Expenses. The Guarantor hereby expressly
waives notice from the Authority, the Trustee or the Holders from time to time
of the Series 1999 Bonds of their acceptance and reliance on this Guaranty
Agreement or of any action taken or omitted in reliance hereon. The Guarantor
further expressly waives diligence, presentment, demand for payment, protest,
any requirement that any right or power be exhausted or any action be taken
against the Authority or the Trustee or against any other obligor under any of
the documents executed in connection with the Series 1999 Bonds. The Guarantor
agrees to pay all reasonable costs, Authority's fees, Trustee's fees and
commissions and expenses (including all reasonable court costs and attorneys'
fees) which may be incurred by the Authority or the Trustee in enforcing or
attempting to enforce this Guaranty Agreement following any Event of Default on
the part of the Guarantor hereunder, whether the same shall be enforced by suit
or otherwise.
Section 2.6. Benefit and Enforcement. This Guaranty Agreement is
entered into by the Guarantor for the benefit of the Authority, the Trustee and
the Holders from time to time of the Series 1999 Bonds, all of whom shall be
entitled in the same manner as set forth in the Indenture to enforce performance
and observance of this Guaranty Agreement to the same extent as if all were
parties signatory hereto.
Section 2.7. Survival of Guarantee Obligation. If the Authority or the
Trustee receive any payment on account of the Guaranteed Obligations, which
payment or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be transferred or
repaid to a trustee, receiver, assignee for the benefit of creditors or any
other party under any bankruptcy act or code, state or federal law or common law
or equitable doctrine or for any other reason whatsoever, then to the extent of
any sum not finally retained by the Authority or the Trustee, this Guaranty
Agreement shall remain in full force and effect until the Guarantor shall have
made payment to the Authority or the Trustee of such sum, which payment shall be
due on demand. If the Authority or the Trustee chooses to contest any such
matter, the Guarantor agrees to indemnify and hold harmless the Authority or the
Trustee, as applicable, with respect to all costs (including court costs and
attorneys' fees) of such litigation.
Section 2.8. Waiver of Rights. No payment hereunder by the Guarantor
shall entitle the Guarantor by subrogation to the rights of the Authority or the
Trustee to any payment by any other obligor or out of the property of any other
obligor, except after payment and performance in full of the Guaranteed
Obligations. The Guarantor waives any benefit of, or any right to participation
in, any security whatsoever now or hereafter held by the Authority and the
Trustee.
-9-
ARTICLE III
NOTICE OF SERVICE OF PROCESS, PLEADINGS AND OTHER PAPERS
Section 3.1. Service of Process. The Guarantor hereby designates and
appoints the President of the Borrower whose office is located at ▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ as the agent of the Guarantor upon
whom may be served all process, pleadings, notices or other papers which may be
served upon the Guarantor as a result of any of its obligations under this
Guaranty Agreement; provided, however, that the serving of such process,
pleadings, notices or other papers shall not constitute a condition to the
Guarantor's obligations hereunder. The Guarantor covenants that for so long as
any of the Guaranteed Obligations are outstanding, the Guarantor will remain
subject to service of process in the State of New Jersey.
Section 3.2. Notices. All notices, demands and other communications by
the Authority or the Trustee to the Guarantor (including process, pleadings or
other papers served upon the foregoing agents) shall be effective (a) if given
by telecopy, when such communication is transmitted to the telecopy number set
forth below, (b) if given by mail within the United States of America, three (3)
Business Days after such communication is deposited in the United States mail
with first class postage prepaid, return receipt requested, addressed to the
Guarantor at the address set forth below, (c) if sent for overnight delivery
within the United States of America by Federal Express or other reputable
national overnight delivery service, one (1) Business Day after such
communication is entrusted to such service for overnight delivery and with
recipient signature required, addressed as aforesaid or (d) if given by any
other means, when delivered at the address of the party to whom such notice is
being delivered:
If to the Guarantor:
DynaGen, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
The Guarantor may designate a different address or telecopy number for the
Guarantor's receipt of such notices or other communications but no such change
shall be effective unless and until the Authority and the Trustee actually
receives written notice thereof from the Guarantor.
Section 3.3. Consent to Jurisdiction. The Guarantor irrevocably and
unconditionally (a) agrees that any suit, action or other legal proceeding
arising out of this Guaranty Agreement may be brought in the courts of record of
the State of New Jersey or the courts of the United States, District of New
Jersey; (b) consents to the jurisdiction of each such court in any such suit,
action or proceeding; and (c) waives any objection which it may have to the
laying of venue of any such suit, action or proceeding in any of such courts.
For such time as any of the Guaranteed Obligations shall be unpaid or
unperformed in whole, or in part, the Guarantor's agents designated in Section
3.1 hereof shall accept and acknowledge on the Guarantor's behalf service of any
and all process in any such suit, action or proceeding brought in any such
court. The Guarantor agrees and consents that any such service of process upon
such agents and written
-10-
notice of such service to the Guarantor in the manner set forth in Section 3.2
hereof shall be taken and held to be valid personal service upon the Guarantor
whether or not the Guarantor shall then be doing, or at any time shall have
done, business within the State of New Jersey and that any such service of
process shall be of the same force and validity as if service were made upon the
Guarantor according to the laws governing the validity and requirements of such
service in the State of New Jersey. Such agents shall not have any power or
authority to enter into any appearance or to file any pleadings in connection
with any suit, action or other legal proceedings against the Guarantor or to
conduct the defense of any such suit, action or any other legal proceeding
except as expressly authorized by the Guarantor.
-11-
ARTICLE IV
MISCELLANEOUS
Section 4.1. No Alteration Without Consent. No amendment, change,
modification, alteration or termination of the Indenture, the Loan Agreement,
the Note, the Mortgage or the Series 1999 Bonds shall be made which would in any
way increase any or all of the Guarantor's obligations under this Guaranty
Agreement without obtaining the prior written consent of the Guarantor. Neither
the acts or omissions recited in Section 2.2 hereof, nor any partial redemption
of the Series 1999 Bonds, shall constitute any such amendment, change,
modification, alteration or termination within the meaning of this Section 4.1.
Section 4.2. Guaranty Agreement to Become Effective. The obligations of
the Guarantor hereunder shall arise absolutely and unconditionally when the
Series 1999 Bonds shall have been issued, authenticated, sold and delivered by
the Authority.
Section 4.3. Remedies Not Exclusive. No remedy herein conferred upon or
reserved to the Authority or the Trustee is intended to be exclusive of any
other available remedy or remedies, but each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Guaranty Agreement or now or hereafter existing at law or in equity. No delay or
omission to exercise any right or power accruing upon any Event of Default,
omission or failure of performance hereunder shall impair any such right or
power or shall be construed to be a waiver thereof, but any such right and power
may be exercised from time to time and as often as may be deemed expedient. In
order to entitle the Authority and the Trustee to exercise any remedy reserved
to it in this Guaranty Agreement, it shall not be necessary to give any notice,
other than such notice as may be expressly required in this Guaranty Agreement.
In the event any provision contained in this Guaranty Agreement should be
breached by any party and thereafter duly waived by the other party so empowered
to act, such waiver shall be limited to the particular breach so waived and
shall not be deemed to waive any other breach hereunder. No waiver, amendment,
release or modification of this Guaranty Agreement shall be established by
conduct, custom or course of dealing, but solely by an instrument in writing
duly executed by the parties hereunto duly authorized by this Guaranty
Agreement.
Section 4.4. Entire Agreement; Counterparts. This Guaranty Agreement
constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof and may be executed simultaneously in several
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument. This Guaranty may be
amended by the Guarantor and the Authority only in accordance with the
Indenture.
Section 4.5. Severability. The invalidity or unenforceability of any
one or more phrases, sentences, clauses or Sections in this Guaranty Agreement
contained, shall not affect the validity or enforceability of the remaining
portions of this Guaranty Agreement, or any part thereof.
Section 4.6. Release. Upon the payment and satisfaction of all
Guaranteed Obligations and, if applicable, upon payment of the costs, fees,
commissions and expenses required by
-12-
Section 2.5 hereof, the Authority shall release in writing the Guarantor from
its obligations hereunder except as provided in Sections 2.1(c) or 2.7 hereof.
Section 4.7. Applicable Law. This Guaranty Agreement shall be governed
by and construed in accordance with the laws of the State of New Jersey.
Section 4.8. Successors and Assigns. Except as hereinafter provided in
this Section 4.8, the Guarantor agrees that during the term of this Guaranty
Agreement it will maintain its corporate existence, will not dissolve or
otherwise dispose of all or substantially all of its assets and will not
consolidate with or merge into another entity or permit one or more other
entities to consolidate with or merge into it; provided, that the Guarantor is
permitted to consolidate with or merge into another entity, or permit one or
more other entities to consolidate with or merge into it, or to sell or
otherwise dispose of all or substantially all of its assets as an entirety and
thereafter dissolve, provided if the Guarantor is not the surviving corporation,
the surviving, resulting or transferee corporation, as the case may be, (i)
assumes in writing all of the Guarantor's obligations under this Guaranty
Agreement, (ii) qualifies or is qualified to do business in New Jersey and (ii)
obtains an opinion of nationally recognized bond counsel to the effect that such
consolidation, merger, sale or other disposition does not adversely affect the
tax exempt status of the Series 1999A Bonds. The Guarantor may not otherwise
assign its obligations under this Guaranty Agreement. Subject to the foregoing,
this Guaranty Agreement shall be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and assigns.
Section 4.9. Date of Guaranty Agreement for Reference Purposes Only.
The date of this Guaranty Agreement shall be for reference purposes only and
shall not be construed to imply that this Guaranty Agreement was executed on the
date first above written.
Section 4.10. Assignment by Authority to Trustee . The Guarantor hereby
acknowledges that the Authority will assign its right, title and interest in
this Guaranty Agreement to the Trustee pursuant to the terms of the Indenture.
Notwithstanding the above, the Authority retains the right to require the
Guarantor to comply with all of the Reserved Rights (as defined in the Loan
Agreement).
-13-
IN WITNESS WHEREOF, the Guarantor has duly authorized the execution of
this Guaranty Agreement as of the date first above written.
DYNAGEN, INC.
(SEAL) By:__________________________
C. ▇▇▇▇▇▇ ▇▇▇▇▇▇
President & CEO
___________________________
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Executive Vice President
Accepted this 24th day of June, 1999
NEW JERSEY ECONOMIC DEVELOPMENT
AUTHORITY
By:___________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Director
-14-