Exhibit 10.23
CONTINUING GUARANTY
(Business Organization)
Pennsylvania
GUARANTOR: National Patent Development Corporation
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Delaware corporation
BORROWER: MXL Industries, Inc.
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BANK: Manufacturers and Traders Trust Company, a New York banking
corporation, with banking offices located at One M&T
Plaza, Buffalo, New York 14240 Attention: Office of the
General Counsel.
1. Guaranty.
(a) Guarantor, intending to be legally bound, hereby unconditionally
guarantees the full and prompt payment and performance of any and all of
Borrower's Obligations (as defined below) to the Bank when due, whether at
stated maturity, by acceleration or otherwise in the maximum amount provided in
Section 2 below. As used in this Guaranty, the term "Obligations" shall mean
obligations, indebtedness and other liabilities of Borrower to the Bank arising
from a Standard LIBOR Grid Note in the face amount of $1,000,000.00 dated and
all related loan documents (the "Loan Documents") and all accrued and unpaid
interest thereon and all Expenses (as defined below). Guarantor will pay or
perform its obligations under this Guaranty upon demand after an Event of
Default under the Loan Documents. This Guaranty is and is intended to be a
continuing guaranty of payment (not collection) of the Obligations. Guarantor
understands that the Bank can bring an action under this Guaranty without being
required to exhaust other remedies or demand payment first from other parties.
(b) Guarantor acknowledges the receipt of valuable consideration for
this Guaranty and acknowledges that the Bank is relying on this Guaranty in
making a financial accommodation to Borrower, whether a commitment to lend,
extension, modification or replacement of, or forbearance with respect to, any
Obligation, cancellation of another guaranty, purchase of Borrower's assets, or
other valuable consideration.
2. Continuing, Absolute, Unconditional. This Guaranty is irrevocable,
absolute, continuing, unconditional. This Guaranty is limited in amount to (1) $
1,000,000.00 of the principal amount of the Obligations plus (2) a proportionate
share (i.e., in the same proportion as the amount in (1) above bears to the
total principal amount of the obligations) of all accrued and unpaid interest,
and Expenses (as defined below) incurred with respect to the Obligations and (3)
all of the Expenses incurred with respect to this Guaranty (collectively, the
"Guaranteed Amount").
3. Guarantor's Waivers & Authorizations.
(a) Guarantor's obligations shall not be released, impaired or affected
in any way including by any of the following, all of which Guarantor hereby
waives (i) any bankruptcy, reorganization or insolvency under any law of
Borrower or that of any other party, or by any action of a trustee in any such
proceeding; (ii) the existence or nonexistence or order of any filings,
exchanges, releases, impairment or sale of, or failure to perfect or continue
the perfection of a security interest in any collateral for the Obligations;
(iii) any failure of Guarantor to receive notice of any intended disposition of
such collateral; (iv) any fictitiousness, incorrectness, invalidity or
unenforceability, for any reason, of any instrument or other agreement which may
evidence any Obligation; (v) any composition, extension, stay or other statutory
relief granted to Borrower including, without limitation, the expiration of the
period of any statute of limitations with respect to any lawsuit or other legal
proceeding against Borrower or any person in any way related to the Obligations
or a part thereof or any collateral therefor; (vi) any change in form of
organization, name, membership or ownership of Borrower or Guarantor; (vii) any
refusal or failure of the Bank or any other person prior to the date hereof or
hereafter to grant any additional loan or other credit accommodation to Borrower
or the Bank's or any other party's receipt of notice of such refusal or failure;
(viii) any setoff, defense or counterclaim of Borrower with respect to the
obligations or otherwise arising, either directly or indirectly, in regard to
the Obligations.
(b) The Guarantor waives acceptance, assent and all rights of notice or
demand including without limitation (i) notice of acceptance of this Guaranty,
of Borrower's default or nonpayment of any Obligation, and of changes in
Borrower's financial condition; (ii) presentment, protest, notice of protest and
demand for payment; (iii) notice that any Obligations has been incurred or of
the reliance by the Bank upon this Guaranty; and (iv) any other notice, demand
or condition to which Guarantor might otherwise be entitled prior to the Bank's
reliance on or enforcement of this Guaranty. Guarantor further authorizes the
Bank, without notice, demand or additional reservation of rights against
Guarantor and without affecting Guarantor's obligations hereunder, from time to
time: (i) to accept and hold collateral from any party for the payment of any or
all of the Obligations, and to exchange, enforce or refrain from enforcing, or
release any or all of such collateral; (ii) to accept any indorsement or
guaranty of any or all of the Obligations or any negotiable instrument or other
writing intended to create an accord and satisfaction with respect to any or all
of the Obligations; (iii) to release, replace or modify the obligation of any
indorser or guarantor, or any party who has given any collateral for any of all
of the Obligations, or any other party in any way obligated to pay any or all of
the Obligations, and to enforce or refrain from enforcing, or compromise or
modify, the terms of any obligation of any such indorser, guarantor or party;
(iv) to dispose of any and all collateral securing the Obligations in any manner
as the Bank, in its sole discretion, may deem appropriate, and to direct the
order and the enforcement of any and all indorsements and guaranties relating to
the Obligations in the Bank's sole discretion; and (v) to determine the manner,
amount and time of application of payments and credits, if any, to be made on
all or any part of the Obligations including, without limitation, if this
Guaranty is limited in amount, to make any such application to Obligations, if
any, in excess of the amount of this Guaranty, provided that such applications
are made in a commercially reasonable manner.
(c) Notwithstanding any other provision in this Guaranty, Guarantor
irrevocably waives, without notice, any right he or she may have at law or in
equity (including without limitation any law subrogating Guarantor to the rights
of the Bank) to seek contribution, indemnification or any other form of
reimbursement from Borrower or any other obligor or guarantor of the Obligations
for any disbursement made under this Guaranty or otherwise, until such time as
the Bank has been paid in full for all principal, interest and fees due under
the Note..
4. Termination. This Guaranty shall remain in full force and effect until
all Obligations outstanding shall be paid in full. Guarantor agrees that, to the
extent that Borrower makes a payment or payments to the Bank on the Obligations,
or the Bank receives any proceeds of collateral to be applied to the
Obligations, which payment or payments or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside or otherwise
are required to be repaid to Borrower, its estate, trustee, receiver or any
other party, including, without limitation, under any bankruptcy law, state or
federal law, common law or equitable cause, then to the extent of such
repayment, the obligation or part thereof which has been paid, reduced or
satisfied by such amount shall be reinstated and continued in full force and
effect as of the date such initial payment, reduction or satisfaction occurred,
notwithstanding any contrary action which may have been taken by the Bank in
reliance upon such payment or payments.
5. Expenses. Guarantor agrees to reimburse the Bank on demand for all the
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Bank's expenses, including without limitation costs of collection and actual
attorneys' fees and disbursements incurred by the Bank in attempting to enforce
this Guaranty, collect any of the Obligations (collectively, "Expenses").
Expenses will accrue interest at the Default Rate as defined in Note evidencing
the Obligations until payment is actually received by the Bank.
6. Financial and Other Information. Guarantor shall promptly deliver to the
Bank copies of all annual reports, proxy statements and similar information
distributed to shareholders, partners or members and of all filings with the
Securities and Exchange Commission and the Pension Benefit Guaranty Corporation.
Guarantor understands this Guaranty and has satisfied itself as to its meaning
and consequences and acknowledges that it has made its own arrangements for
keeping informed of changes or potential changes affecting the Borrower
including the Borrower's financial condition.
7. No Transfer of Assets. Guarantor shall not transfer, reinvest or
otherwise dispose of its assets in a manner or to an extent that would
materially impair Guarantor's ability to perform its obligations under this
Guaranty.
8. Nonwaiver by the Bank; Miscellaneous. This Guaranty is intended by
Guarantor to be the final, complete and exclusive expression of the agreement
between Guarantor and the Bank. This Guaranty may be assigned by the Bank, shall
inure to the benefit of the Bank and its successors and assigns, and shall be
binding upon Guarantor and his or her legal representative, successors and
assigns and any participation may be granted by the Bank herein in connection
with the assignment or granting of a participation by the Bank in the
Obligations or any part thereof. All rights and remedies of the Bank are
cumulative, and no such right or remedy shall be exclusive of any other right or
remedy. This Guaranty does not supersede any other guaranty or security granted
to the Bank by Guarantor or others (except as to Guarantor's Waiver of
Subrogation rights above). No single, partial or delayed exercise by the Bank of
any right or remedy shall preclude exercise by the Bank at any time at its sole
option of the same or any other right or remedy of the Bank without notice.
Guarantor expressly disclaims any reliance on any course of dealing or usage of
trade or oral representation of the Bank including, without limitation,
representations to make loans to Borrower or enter into any other agreement with
Borrower or Guarantor. No course of dealing or other conduct, no oral agreement
or representation made by the Bank or usage of trade shall operate as a waiver
of any right or remedy of the Bank. No waiver or amendment of any right or
remedy of the Bank or release by the Bank shall be effective unless made
specifically in writing by the Bank. Each provision of this Guaranty shall be
interpreted as consistent with existing law and shall be deemed amended to the
extent necessary to comply with any conflicting law. If any provision
nevertheless is held invalid, the other provisions shall remain in effect.
Guarantor agrees that in any legal proceeding, a copy of this Guaranty kept in
the Bank's course of business may be admitted into evidence as an original.
Captions are solely for convenience and not part of the substance of this
Guaranty. Payments made to the Bank by Guarantor after maturity of the
Obligations, by acceleration or otherwise, shall reduce the Guaranteed Amount.
9. Authorization. Guarantor certifies that it is an entity in the form
described above duly organized and in good standing under the laws of the State
of its organization and duly authorized to do business in each State material to
the conduct of its business. Guarantor has determined that the execution of this
Guaranty will be in its best interests. Execution of this Guaranty by the
persons signing below has been authorized by all necessary corporate action.
Guarantor's chief executive office is located at the above address.
10. Notices. Any demand or notice hereunder or under any applicable law
pertaining hereto shall be in writing and duly given if delivered to Guarantor
(at its address on the Bank's records) or to the Bank (at the address on page
one and separately to the Bank officer responsible for Borrower's relationship
with the Bank). Such notice or demand shall be deemed sufficiently given for all
purposes when delivered (i) by personal delivery and shall be deemed effective
when delivered, or (ii) by mail or courier and shall be deemed effective three
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(3) business days after deposit in an official depository maintained by the
United States Post Office for the collection of mail or one (1) business day
after delivery to a nationally recognized overnight courier service (e.g.,
Federal Express). Notice by e-mail is not valid notice under this or any other
agreement between Guarantor and the Bank.
11. Governing Law and Jurisdiction. This Guaranty has been delivered to and
accepted by the Bank and will be deemed to be made in the Commonwealth of
Pennsylvania. Except as otherwise provided under federal law, this Guaranty will
be interpreted in accordance with the laws of the Commonwealth of Pennsylvania
excluding its conflict of laws rules. GUARANTOR HEREBY IRREVOCABLY CONSENTS TO
THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT IN THE COMMONWEALTH OF
PENNSYLVANIA IN A COUNTY OR JUDICIAL DISTRICT WHERE THE BANK MAINTAINS A BRANCH
AND CONSENTS THAT THE BANK MAY EFFECT ANY SERVICE OF PROCESS IN THE MANNER AND
AT GUARANTOR'S ADDRESS SET FORTH ABOVE FOR PROVIDING NOTICE OR DEMAND; PROVIDED
THAT NOTHING CONTAINED IN THIS GUARANTY WILL PREVENT THE BANK FROM BRINGING ANY
ACTION, ENFORCING ANY AWARD OR JUDGMENT OR EXERCISING ANY RIGHTS AGAINST
GUARANTOR INDIVIDUALLY, AGAINST ANY SECURITY OR AGAINST ANY PROPERTY OF
GUARANTOR WITHIN ANY OTHER COUNTY, STATE OR OTHER FOREIGN OR DOMESTIC
JURISDICTION. Guarantor acknowledges and agrees that the venue provided above is
the most convenient forum for both the Bank and Guarantor. Guarantor waives any
objection to venue and any objection based on a more convenient forum in any
action instituted under this Guaranty.
12. Waiver of Jury Trial. GUARANTOR AND THE BANK HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVE ANY RIGHT TO TRIAL BY JURY GUARANTOR AND
THE BANK MAY HAVE IN ANY ACTION OR PROCEEDING, IN LAW OR IN EQUITY, IN
CONNECTION WITH THIS GUARANTY OR THE TRANSACTIONS RELATED HERETO. GUARANTOR
REPRESENTS AND WARRANTS THAT NO REPRESENTATIVE OR AGENT OF THE BANK HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK WILL NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THIS JURY TRIAL WAIVER. GUARANTOR ACKNOWLEDGES THAT
THE BANK HAS BEEN INDUCED TO ENTER INTO THIS GUARANTY BY, AMONG OTHER THINGS,
THE PROVISIONS OF THIS SECTION.
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13. Guarantor acknowledges that it has read and understands all the
provisions of this Guaranty, including the Governing Law, Jurisdiction and
Waiver of Jury Trial, and has been advised by counsel as necessary or
appropriate.
GUARANTOR:
NATIONAL PATENT DEVELOPMENT CORPORATION
DATE By:
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TIN #
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ACKNOWLEDGMENT
COMMONWEALTH OF PENNSYLVANIA)
: SS.
COUNTY OF ________________________)
On the ___________ day of __________________, in the year 20_______,
before me, the undersigned, a Notary Public in and for said Commonwealth,
personally appeared ______________________________________________, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual(s) whose name(s) is (are) subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.
Notary Public
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