CONTINUING UNCONDITIONAL GUARANTY
This
Continuing Unconditional Guaranty (this “Guaranty”)
dated
as of the 16th
day of
November, 2006 (the “Effective
Date”),
is
made by Pars Investments, Inc., a Texas corporation (the “Guarantor”),
for
the benefit of United Development Funding III, L.P., a Delaware limited
partnership and its successors and assigns (“Lender”).
R
E C I T A L S:
A. The
Lender has agreed to advance funds to Centurion Acquisitions, L.P., a Texas
limited partnership (the “Borrower”)
as
borrower under that certain Secured
Promissory Note dated as of the Effective Date in the principal amount of U.S.
$5,272,250.00 (the “Note”).
B. Guarantor
is the general partner of Borrower and an affiliate of Borrower, and shall
benefit, directly or indirectly, from the loan made to Borrower pursuant to
the
Note.
C. Guarantor
is willing to execute this Guaranty in favor of Lender and hereby agree to
be
bound by its terms and conditions.
A
G R E E M E N T:
NOW,
THEREFORE, for good and valuable consideration, and intending to be legally
bound hereby, Guarantor agrees and covenants with Lender as
follows:
1. Definitions.
Capitalized terms not defined in this Guaranty shall have the respective
meanings given to such terms in the Note.
2. Guaranty
and Surety.
Guarantor hereby absolutely and unconditionally guarantees, and becomes surety
for, the full, timely and complete payment when due, whether by lapse of time,
by acceleration of payment, or otherwise, of all indebtedness, liabilities
and
obligations of Borrower to Lender existing or arising under (a) the Note and
the
other Loan Documents, (b) all other indebtedness and obligations owed by
Borrower to Lender, (c) all costs reasonably incurred by Lender to obtain,
preserve, perfect and enforce the security interests granted by this Agreement
and to maintain, preserve and collect any collateral, and all taxes,
assessments, insurance premiums, repairs, reasonable attorneys’ fees and legal
expenses, rent, storage charges, advertising costs, brokerage fees and expenses
of sale related thereto, and (d) all renewals, extensions, modifications
and substitutions of all or any part of the indebtedness and obligations
described in the foregoing clauses (a) through (c) (collectively, the
“Guaranteed
Obligations”).
Guarantor’s obligation under this Guaranty is unconditional, absolute and
enforceable, irrespective of (a) the validity or enforceability of the
Guaranteed Obligations in whole or in part or of the Note and the other Loan
Documents or any provision thereof, (b) whether recovery against Borrower with
respect to the Guaranteed Obligations in whole or in part is prevented by
bankruptcy, the operation of law, or otherwise, and (c) any other circumstance
that might otherwise cause a legal or equitable discharge or defense of
Guarantor.
3. Subsequent
Acts by Lender.
Lender
may, in its sole discretion and without notice, take or refrain from taking
any
action that might otherwise be deemed a legal or equitable release or discharge
of Guarantor’s obligations under this Guaranty, without either impairing or
affecting the liability of Guarantor for the full, timely and complete payment
of the Guaranteed Obligations, which actions might include, by way of
illustration and not limitation:
(a) the
renewal or extension of any of the Guaranteed Obligations or any payments
thereunder, or the acceleration or change of time for payment of the Guaranteed
Obligations any increase in the principal amount of any promissory note or
other
instrument comprising a part of the Guaranteed Obligations and/or any additional
funds advanced under the Guaranteed Obligations (including any such advances
in
excess of the face amount of the Note);
(b) the
modification, amendment or change in any of the terms relating to any promissory
note or other agreement, document or instrument now or hereafter executed by
Borrower in favor of Lender;
(c) the
absence of any attempt to collect the Guaranteed Obligations from Borrower
or
any other person or entity primarily or secondarily liable for the Guaranteed
Obligations or any other action to enforce Lender’s rights with respect to the
Guaranteed Obligations;
(d) the
waiver, consent, or delay in enforcement by Lender with respect to any provision
of any instrument evidencing the Guaranteed Obligations, including, without
limitation, the Note and the other Loan Documents;
(e) any
failure by Lender to take any steps to perfect and maintain its security
interest in, or to preserve its rights to, any security or collateral given
for
the Guaranteed Obligations, or the release or compromise of any lien or security
held by Lender as security for the Guaranteed Obligations;
(f) the
compounding, rearrangement or consolidation by Lender of all or any part of
the
Guaranteed Obligations;
(g) the
release from liability of Borrower or any other guarantor or person or entity
primarily or secondary liable for the Guaranteed Obligations who may guarantee
or provide security for the Guaranteed Obligations in whole or in part;
or
(h) the
settlement, release, compromise or cancellation of all or any part of the
Guaranteed Obligations, or the acceptance of partial payment of all or any
part
of the Guaranteed Obligations.
4. Expenses.
Guarantor agrees to pay all costs and expenses, including, without limitation,
all court costs and reasonable attorneys’ fees paid or incurred by Lender in
endeavoring to collect all or any part of the Guaranteed Obligations, or in
enforcing or pursuing its remedies with respect to the Guaranteed
Obligations.
5. Payment
by Guarantor.
In the
event of any failure to pay with respect to the Guaranteed Obligations or any
“default” or “event of default” under the Note or the other Loan Documents (the
terms “default” and “event of default” having the respective meanings given to
such terms in the Note and the other Loan Documents), Guarantor agrees to pay
on
demand, all of the Guaranteed Obligations and all other costs, expenses and
other amounts payable under this Guaranty. Lender shall not be required to
liquidate any lien or any other form of security, instrument, or note held
by
Lender prior to making such demand. THIS IS A GUARANTY OF PAYMENT AND NOT OF
COLLECTION, and Guarantor specifically agrees that Lender shall not be required
to assert any claim, file suit, or proceed to obtain a judgment against Borrower
or any other guarantor, endorser or surety for the Guaranteed Obligations,
or
make any effort at collection of the Guaranteed Obligations, or foreclose
against or seek to realize upon any security or collateral now or hereafter
existing for the Guaranteed Obligations, or exercise or assert any other right
or remedy to which Lender is or may be entitled in connection with the
Guaranteed Obligations, before or as a condition of enforcing the liability
of
Guarantor under this Guaranty or requiring payment of the Guaranteed Obligations
under this Guaranty. Guarantor agrees, to the full extent it may legally do
so,
that suit may be brought against Guarantor with or without making Borrower
or
any other person or entity a party to such suit, as Lender may elect. Guarantor
agrees that Guarantor shall remain fully liable under this Guaranty regardless
of whether Borrower is held to be not liable on the Guaranteed Obligations
and
regardless of whether all or any portion of the Guaranteed Obligations are
“non-recourse” or “limited recourse” to Borrower.
6. Application
of Payments.
Lender
shall have the exclusive right to determine the time and manner of application
of any payments or credits to the Guaranteed Obligations, whether received
from
Borrower or any other source, and such determination shall be binding on
Guarantor. All such payments and credits may be applied, reversed and reapplied,
in whole or in part, to any of the Guaranteed Obligations as Lender shall
determine in its sole discretion without affecting the validity or
enforceability of this Guaranty.
7. Guarantor’s
Responsibilities.
Guarantor hereby assumes responsibility for keeping himself informed of the
financial condition of Borrower, and any and all endorsers and/or other
guarantors of any instrument or document evidencing all or any part of the
Guaranteed Obligations and of all other circumstances bearing upon the risk
of
nonpayment of the Guaranteed Obligations. Guarantor further agrees that Lender
shall have no duty to advise Guarantor of any information known to Lender
regarding such condition or such circumstances or to undertake any
investigation. If Lender, in its sole discretion, undertakes at any time or
from
time to time to provide any information to Guarantor, Lender shall be under
no
obligation to update any such information or to provide any such information
to
Guarantor on any subsequent occasion.
8. Reinstatement.
Guarantor agrees that, to the extent any payment or payments are made to Lender
or Lender receives any proceeds of collateral, which payments or proceeds are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to Borrower or any other party, then Guarantor’s
obligations under this Guaranty to the extent of such repayment, shall
immediately and automatically be reinstated and continued in full force and
effect.
9. Subordination.
Guarantor agrees that any and all claims of Guarantor against Borrower, any
endorser or any other guarantor of all or any part of the Guaranteed
Obligations, or against the properties and assets of Borrower, whether arising
by reason of any payment by Guarantor to Lender pursuant to the provisions
of
this Guaranty or otherwise, shall be subordinate and subject in right of payment
to the prior payment, in full, to Lender of all of the Guaranteed Obligations.
10. Waivers
by Guarantor.
Guarantor hereby waives to the extent permissible by law: notice of acceptance
of this Guaranty and of creation of the Guaranteed Obligations, presentment,
notice of non-payment, and demand for payment of the Guaranteed Obligations,
protest, notice of protest, and notice of dishonor or default to Guarantor
or to
any other party with respect to any of the Guaranteed Obligations, and all
other
notices to which Guarantor might otherwise be entitled.
11. Continuation.
This
Guaranty shall continue in full force and effect with respect to Guarantor
and
Lender shall be entitled to make loans and advances and extend financial
accommodations to Borrower on the faith of this Guaranty until Lender delivers
to Guarantor, a written release of Borrower from his obligations under this
Guaranty executed by Lender.
12. Mutual
Understanding.
Guarantor represents and warrants to Lender that Guarantor has read and fully
understands the terms and provisions hereof, has had an opportunity to review
this Guaranty with legal counsel and has executed this Guaranty based on
Guarantor’s own judgment and advice of counsel. If an ambiguity or question of
intent or interpretation arises, this Guaranty will be construed as if drafted
jointly by the Guarantor and Lender and no presumption or burden of proof will
arise favoring or disfavoring any party because of authorship of any provision
of this Guaranty.
13. Further
Assurances.
Guarantor at Guarantor’s expense will promptly (a) execute and deliver to Lender
on Lender’s request, all such other and further documents, agreements and
instruments as may be requested by Lender, and (b) deliver all such
supplementary information as may be requested by Lender, in compliance with
or
accomplishment of the agreements of Guarantor under this Guaranty.
14. Cumulative
Remedies.
Guarantor hereby agrees that all rights and remedies that Lender is afforded
by
reason of this Guaranty are separate and cumulative with respect to Guarantor
and otherwise and may be pursued separately, successively, or concurrently,
as
Lender deems advisable. In addition, all such rights and remedies of Lender
are
non-exclusive and shall in no way limit or prejudice Lender’s ability to pursue
any other legal or equitable rights or remedies that may be available to
Lender.
15. Notice.
All
notices and other communications under this Guaranty will be in writing and
will
be mailed by registered or certified mail, postage prepaid, sent by facsimile,
delivered personally by hand, or delivered by nationally recognized overnight
delivery service addressed to Guarantor at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Facsimile No. Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇ or, with
respect to Lender, to Lender at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, Facsimile No. (▇▇▇) ▇▇▇-▇▇▇▇, or to such other address as a party may
have delivered to the other parties for purposes of notice. Each notice or
other
communication will be treated as effective and as having been given and received
(a) if sent by mail, at the earlier of its receipt or three business days after
such notice or other communication has been deposited in a regularly maintained
receptacle for deposit of United States mail, (b) if sent by facsimile, upon
written or electronic confirmation of facsimile transfer, (c) if delivered
personally by hand, upon written or electronic confirmation of delivery from
the
person delivering such notice or other communication, or (d) if sent by
nationally recognized overnight delivery service, upon written or electronic
confirmation of delivery from such service.
16. Enforcement
and Waiver by Lender.
Lender
shall have the right at all times to enforce the provisions of this Guaranty
in
strict accordance with their respective terms, notwithstanding any conduct
or
custom on the part of Lender in refraining from so doing at any time or times.
The failure of Lender at any time or times to enforce its rights under such
provisions strictly in accordance with the same, shall not be construed as
having created a custom or in any way or manner modified or waived the same.
All
rights and remedies of Lender are cumulative and concurrent and the exercise
of
one right or remedy shall not be deemed a waiver or release of any other right
or remedy.
17. CHOICE
OF LAW; JURISDICTION; VENUE.
EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF SECURITY INTERESTS
OR
REMEDIES IN RESPECT OF ANY PARTICULAR COLLATERAL IS GOVERNED BY THE LAWS OF
A
JURISDICTION OTHER THAN THE STATE OF TEXAS, THIS GUARANTY SHALL BE CONSTRUED
IN
ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS,
WITHOUT REGARD TO ITS CONFLICTS OF LAWS PROVISIONS. JURISDICTION FOR ALL MATTERS
ARISING OUT OF THIS GUARANTY SHALL BE EXCLUSIVELY IN THE STATE AND FEDERAL
COURTS SITTING IN DALLAS COUNTY, TEXAS, AND GUARANTOR HEREBY IRREVOCABLY SUBMITS
TO THE JURISDICTION OF SUCH STATE AND FEDERAL COURTS AND AGREES AND CONSENTS
NOT
TO ASSERT IN ANY PROCEEDING, THAT ANY SUCH PROCESS IS BROUGHT IN AN INCONVENIENT
FORUM OR THAT THE VENUE THEREOF IS IMPROPER, AND FURTHER AGREES TO A TRANSFER
OF
SUCH PROCEEDING TO THE COURTS SITTING IN DALLAS COUNTY,
TEXAS.
18. Severability.
If any
provision of this Guaranty shall be held invalid under any applicable laws,
then
all other terms and provisions of this Guaranty shall nevertheless remain
effective and shall be enforced to the fullest extent permitted by applicable
law.
19. Amendments;
Waivers.
No
amendment or waiver of any provision of this Guaranty nor consent to any
departure by Guarantor herefrom shall in any event be effective unless the
same
shall be in writing and signed by Lender and Guarantor, and then such waiver
or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
20. Binding
Effect; Assignment.
This
Guaranty shall be binding on Guarantor and Guarantor’s administrators, other
legal representatives, successors, heirs and assigns, including, without
limitation, any receiver, trustee or debtor in possession of or for Guarantor,
and shall inure to the benefit of Lender and its successors and assigns.
Guarantor shall not be entitled to transfer or assign this Guaranty in whole
or
in part without the prior written consent of Lender. This Guaranty is freely
assignable and transferable by Lender without the consent of Guarantor. Should
the status, composition, structure or name of Guarantor change, this Guaranty
shall continue and also cover the Guaranteed Obligations under the new status
composition, structure or name according to the terms of this Guaranty.
21. Captions.
The
captions in this Guaranty are for the convenience of reference only and shall
not limit or otherwise affect any of the terms or provisions
hereof.
22. Number
of Gender of Words.
Except
where the context indicates otherwise, words in the singular number will include
the plural and words in the masculine gender will include the feminine and
neutral, and vice versa, when they should so apply.
23. WAIVER
OF JURY TRIAL, PUNITIVE DAMAGES, ETC.
GUARANTOR HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY (A)
WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT HE MAY HAVE
TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR DIRECTLY OR
INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY
OR THE LOAN DOCUMENTS OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY OR
ASSOCIATED HEREWITH OR THEREWITH, BEFORE OR AFTER MATURITY OF THE NOTE; (B)
WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW, ANY RIGHT HE MAY HAVE
TO
CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY “SPECIAL DAMAGES”, AS DEFINED BELOW,
(C) CERTIFIES THAT NO PARTY HERETO NOR ANY REPRESENTATIVE OF LENDER OR COUNSEL
FOR ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, OR IMPLIED THAT
SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVERS, AND (D) ACKNOWLEDGES THAT LENDER HAS BEEN INDUCED TO ENTER INTO
THIS GUARANTY, THE NOTE AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS,
THE
WAIVERS AND CERTIFICATIONS CONTAINED IN THIS SECTION. AS USED IN THIS SECTION,
“SPECIAL DAMAGES” INCLUDES ALL SPECIAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE
DAMAGES (REGARDLESS OF HOW NAMED), BUT DOES NOT INCLUDE ANY PAYMENTS OR FUNDS
WHICH ANY PARTY HERETO HAS EXPRESSLY PROMISED TO PAY OR DELIVER TO ANY OTHER
PARTY HERETO.
25. ENTIRE
AGREEMENT.
THIS GUARANTY TOGETHER WITH THE NOTE AND THE OTHER LOAN DOCUMENTS TOGETHER
CONSTITUTE THE ENTIRE AGREEMENT AMONG THE PARTIES CONCERNING THE SUBJECT MATTER
HEREOF, AND ALL PRIOR DISCUSSIONS, AGREEMENTS AND STATEMENTS, WHETHER ORAL
OR
WRITTEN, ARE MERGED INTO THIS GUARANTY, THE NOTE AND THE OTHER LOAN DOCUMENTS.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES AND THIS GUARANTY,
THE
NOTE AND THE OTHER LOAN DOCUMENTS MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
[The
remainder of this page is left blank intentionally.]
IN
WITNESS WHEREOF, Guarantor has duly executed this Guaranty on this the 16th
day
of November, 2006, effective for all purposes as of the Effective
Date.
GUARANTOR:
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PARS
INVESTMENTS, INC.
a Texas corporation
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| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ |
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| Its: President | ||