|
Exhibit 10.6
E XECUTION
C OPY
GUARANTY
THIS GUARANTY, dated as of January 31, 2007, is made and
given by the undersigned (each, a " Guarantor " and
collectively, the " Guarantors "), in favor of WB QT, LLC, a
Delaware limited liability company, in its capacity as Agent (in
such capacity, the " Agent "), for the " Lenders " as
defined in and from time to time party to the Credit Agreement
(defined below).
RECITALS
A. Quantum Fuel Systems Technologies Worldwide, Inc., a Delaware
corporation (the " Borrower "), the Agent and the Lenders
have entered into a Credit Agreement dated as of January 31,
2007 (as the same may hereafter be amended, restated, or otherwise
modified from time to time, the " Credit Agreement ")
pursuant to which the Lenders have agreed to extend to the Borrower
certain credit accommodations.
B. It is a condition precedent to the obligation of the Lenders
to extend credit accommodations pursuant to the terms of the Credit
Agreement that this Guaranty be executed and delivered by each
Guarantor.
C. Each Guarantor is a Subsidiary (as defined in the Credit
Agreement) of the Borrower.
D. Each Guarantor expects to derive benefits from the extension
of credit accommodations to the Borrower by the Lenders and each
Guarantor finds it advantageous, desirable and in its best
interests to execute and deliver this Guaranty to the Agent.
NOW, THEREFORE, In consideration of the credit accommodations to
be extended to the Borrower and for other good and valuable
consideration, each Guarantor hereby covenants and agrees with the
Agent for the benefit of the Agent and the Lenders as follows:
Section 1. Defined Terms . As used in this Guaranty,
the following terms shall have the meaning indicated:
" Agent " shall have the meaning indicated in the opening
paragraph hereof.
" Borrower " shall have the meaning indicated in Recital
A.
" Credit Agreement " shall have the meaning indicated in
Recital A.
" Guarantor " shall have the meaning indicated in the
opening paragraph hereof.
" Lenders " shall have the meaning indicated in the
opening paragraph hereof.
" Obligations " shall mean all indebtedness, liabilities
and obligations of each Guarantor to the Agent or any Lender of
every kind, nature or description under the Credit Agreement,
including the Borrower’s obligation on any
promissory note or notes under the Credit Agreement and any note or
notes hereafter issued in substitution or replacement thereof, and
in all of the foregoing cases whether due or to become due, and
whether now existing or hereafter arising or incurred
" Person " shall mean any individual, corporation,
partnership, limited partnership, limited liability company, joint
venture, firm, association, trust, unincorporated organization,
government or governmental agency or political subdivision or any
other entity, whether acting in an individual, fiduciary or other
capacity.
Section 2. The Guaranty . Subject always to the
following Section 3, each Guarantor, jointly and severally
with the other Guarantors, hereby absolutely and unconditionally
guarantees to the Agent for the ratable benefit of the Lenders the
payment when due (whether at a stated maturity or earlier by reason
of acceleration or otherwise) and performance of the
Obligations.
Section 3. Limitation; Insolvency Laws . As used in
this Section: (a) the term "Applicable Insolvency Laws" means
the laws of the United States of America or of any State, province,
nation or other governmental unit relating to bankruptcy,
reorganization, arrangement, adjustment of debts, relief of
debtors, dissolution, insolvency, fraudulent transfers or
conveyances or other similar laws (including, without limitation,
11 U. S. C. §547, §548, §550 and other "avoidance"
provisions of Title 11 of the United Stated Code) as applicable in
any proceeding in which the validity and/or enforceability of this
Guaranty or any Specified Lien is in issue; and (b) "Specified
Lien" means any security interest, mortgage, lien or encumbrance
securing this Guaranty, in whole or in part. Notwithstanding any
other provision of this Guaranty, if, in any proceeding, a court of
competent jurisdiction determines that this Guaranty or any
Specified Lien would, but for the operation of this Section, be
subject to avoidance and/or recovery or be unenforceable by reason
of Applicable Insolvency Laws, this Guaranty and each such
Specified Lien shall be valid and enforceable only to the maximum
extent that would not cause this Guaranty or such Specified Lien to
be subject to avoidance, recovery or unenforceability. To the
extent that any payment to, or realization by, the Agent or any
Lender on the guaranteed Obligations exceeds the limitations of
this Section and is otherwise subject to avoidance and recovery in
any such proceeding, the amount subject to avoidance shall in all
events be limited to the amount by which such actual payment or
realization exceeds such limitation, and this Guaranty as limited
shall in all events remain in full force and effect and be fully
enforceable against the Guarantors. This Section is intended solely
to reserve the rights of the Agent hereunder against the Guarantors
in such proceeding to the maximum extent permitted by Applicable
Insolvency Laws and neither the Guarantors, the Borrower, any other
guarantor of the Obligations nor any Person shall have any right,
claim or defense under this Section that would not otherwise be
available under Applicable Insolvency Laws in such proceeding.
Section 4. Continuing Guaranty . This Guaranty is an
absolute, unconditional and continuing guaranty of payment and
performance of the Obligations, and the obligations of any
Guarantor hereunder shall not be released, in whole or in part, by
any action or thing which might, but for this provision of this
Guaranty, be deemed a legal or equitable discharge of a surety or
guarantor, other than irrevocable payment and performance in full
of the Obligations.
2
No notice of the Obligations to which this
Guaranty may apply, or of any renewal or extension thereof need be
given to any Guarantor and none of the foregoing acts shall release
any Guarantor from liability hereunder. Each Guarantor hereby
expressly waives (a) demand of payment, presentment, protest,
notice of dishonor, nonpayment or nonperformance on any and all
forms of the Obligations; (b) notice of acceptance of this
Guaranty and notice of any liability to which it may apply;
(c) all other notices and demands of any kind and description
relating to the Obligations now or hereafter provided for by any
agreement, statute, law, rule or regulation; and (d) any and
all defenses of the Borrower pertaining to the Obligations except
for the defense of discharge by payment. No Guarantor shall be
exonerated with respect to such Guarantor’s liabilities under
this Guaranty by any act or thing except irrevocable payment and
performance of the Obligations, it being the purpose and intent of
this Guaranty that the Obligations constitute the direct and
primary obligations of the Guarantors and that the covenants,
agreements and all obligations of the Guarantors hereunder be
absolute, unconditional and irrevocable. The Guarantors shall be
and remain liable for any deficiency remaining after foreclosure of
any mortgage, deed of trust or security agreement securing all or
any part of the Obligations, whether or not the liability of the
Borrower or any other Person for such deficiency is discharged
pursuant to statute, judicial decision or otherwise. The acceptance
of this Guaranty by the Agent is not intended and does not release
any liability previously existing of any guarantor or surety of any
indebtedness of the Borrower to the Agent or any Lender.
Section 5. Other Transactions . The Agent is
expressly authorized (a) to exchange, surrender or release
with or without consideration any or all collateral and security
which may at any time be placed with it by the Borrower or by any
other Person, or to forward or deliver any or all such collateral
and security directly to the Borrower for collection and remittance
or for credit, or to collect the same in any other manner without
notice to any Guarantor and (b) to amend, modify, extend or
supplement the Credit Agreement, any note or other instrument
evidencing the Obligations or any part thereof and any other
agreement with respect to the Obligations, waive compliance by the
Borrower or any other Person with the respective terms thereof and
settle or compromise any of the Obligations without notice to any
Guarantor and without in any manner affecting the absolute
liabilities of the Guarantors hereunder. No invalidity,
irregularity or unenforceability of all or any part of the
Obligations or of any security therefor or other recourse with
respect thereto shall affect, impair or be a defense to this
Guaranty. The liabilities of a Guarantor hereunder shall not be
affected or impaired by any failure, delay, neglect or omission on
the part of the Agent to realize upon any of the Obligations of the
Borrower to the Agent or any Lender, or upon any collateral or
security for any or all of the Obligations, nor by the taking by
the Agent of (or the failure to take) any other guaranty or
guaranties to secure the Obligations, nor by the taking by the
Agent of (or the failure to take or the failure to perfect its
security interest in or other lien on) collateral or security of
any kind. No act or omission of the Agent or any Lender, whether or
not such action or failure to act varies or increases the risk of,
or affects the rights or remedies of a Guarantor shall affect or
impair the obligations of such Guarantor hereunder. Each Guarantor
acknowledges that this Guaranty is in effect and binding without
reference to whether this Guaranty is signed by any other Person or
Persons, that possession of this Guaranty by the Agent shall be
conclusive evidence of due delivery hereof by such Guarantor and
that this Guaranty shall continue in full force and effect, both as
to the Obligations then existing and/or thereafter created,
notwithstanding the release of or extension of time to any other
guarantor of the Obligations or any part thereof.
3
Section 6. Actions Not Required .
Each Guarantor hereby waives any and all right to cause a
marshalling of the assets of the Borrower or any other action by
any court or other governmental body with respect thereto or to
cause the Agent to proceed against any security for the Obligations
or any other recourse which the Agent may have with respect thereto
and further waives any and all requirements that the Agent or any
Lender institute any action or proceeding at law or in equity, or
obtain any judgment, against the Borrower or any other Person, or
with respect to any collateral security for the Obligations, as a
condition precedent to making demand on or bringing an action or
obtaining and/or enforcing a judgment against, such Guarantor upon
this Guaranty. Each Guarantor further acknowledges that time is of
the essence with respect to such Guarantor’s obligations
under this Guaranty. Any remedy or right hereby granted which shall
be found to be unenforceable as to any Person or under any
circumstance, for any reason, shall in no way limit or prevent the
enforcement of such remedy or right as to any other Person or
circumstance, nor shall such unenforceability limit or prevent
enforcement of any other remedy or right hereby granted.
Section 7. No Subrogation . Notwithstanding any
payment or payments made by a Guarantor hereunder, each Guarantor
waives all rights of subrogation to any of the rights of the Agent
or any Lender against the Borrower or any other Person liable for
payment of any of the Obligations or any collateral security or
guaranty or right of offset held by the Agent or any Lender for the
payment of the Obligations, and each Guarantor waives all rights to
seek any recourse to or contribution or reimbursement from the
Borrower or any other Person liable for payment of any of the
Obligations in respect of payments made by such Guarantor
hereunder.
Section 8. Application of Payments . Any and all
payments upon the Obligations made by the Guarantors or by any
other Person, and/or the proceeds of any or all collateral or
security for any of the Obligations, may be applied by the Agent on
such items of the Obligations as the Agent may elect.
Section 9. Recovery of Payment . If any payment
received by the Agent or a Lender and applied to the Obligations is
subsequently set aside, recovered, rescinded or required to be
returned for any reason (including, without limitation, the
bankruptcy, insolvency or reorganization of the Borrower or any
other obligor), the Obligations to which such payment was applied
shall for the purposes of this Guaranty be deemed to have continued
in existence, notwithstanding such application, and this Guaranty
shall be enforceable as to such Obligations as fully as if such
application had never been made. References in this Guaranty to
amounts "irrevocably paid" or to "irrevocable payment" refer to
payments that cannot be set aside, recovered, rescinded or required
to be returned for any reason.
Section 10. Borrower’s Financial Condition .
Each Guarantor is familiar with the financial condition of the
Borrower, and each Guarantor has executed and delivered th
|
