GUARANTY
This Guaranty
(the "Guaranty”) is made on the 19 day of December 2007,
among the persons whose names are set forth at the end of this
Guaranty (collectively the "GuarantoI8"), and TRANSCAP TRADEFINANCE
LLC, an Illinois limited liability company as successor in interest
to TRANSCAP TRADE FINANCE, an Illinois general partnership (the
"Contractor"), as follows:
BACKGROUND OF
AGREEMENT:
A. The
Contractor and Destination Software, Inc., a New Jersey corporation
(the "Distributor"), have on this day entered into a Master
Purchase Order Assignment Agreement (the "Assignment Agreement")
under the terms of which the Distributor will assign customer
purchase orders to the Contractor and request the Contractor to
purchase the required materials to fulfill such purchase orders;
the Contractor will retain the Distributor to manufacture, process
and ship ordered goods; and fees will be paid to the Contractor and
the Distributor for their services there under.
B. Each of the
Guarantors has a substantial financial stake in the Distributor and
will substantially benefit from the performance by Contractor of
its obligations under the Assignment Agreement.
C. The
execution of this Guaranty is an express condition to the
consummation of the transactions contemplated by the Assignment
Agreement and the Contractor is unwilling to enter into or perform
in accordance with the Assignment Agreement in the absence of the
execution of this Guaranty.
NOW THEREFORE, in consideration of the services
to be performed, the payments to be made, and the obligations to be
assumed by the Contractor pursuant to the Assignment Agreement, and
further as an inducement to the Contractor to enter into and
perform in accordance with the Assignment Agreement, the Guarantors
hereby agree as follows:
I. DEFINITIONS.
In this Guaranty. the following frequently used terms are defined
as set forth in this Section I:
(a) Any terms
used in this Guaranty which are defined in the Assignment Agreement
will have the same meaning herein as is ascribed to such term in
the Assignment Agreement.
(b) The
"Contract Documents" are, collectively, the Assignment Agreement,
~e Security Agreement and Financing Statement between the
Contractor and the Distributor dated this day. The Subordination
Agreement between the Contractor, the Distributor, and the Senior
Lender dated this day, and this Guaranty.
(c) The
"Obligations” mean all of the obligations of the Distributor
and each of the Guarantors pursuant to the Contract
Documents.
(d) The term
"Guarantors" means all of the undersigned, jointly and severally;
and the term "Guarantor" means each of the undersigned.
individually and collectively.
(e) A
''Default'' means the occurrence of an event of default by the
Distributor pursuant to or in accordance with the provisions of any
of the Contract Documents or the failure of the Guarantors (or any
of them) to perform any covenant agreement contained in this
Guaranty or if any representation or warranty contained in this
Guaranty is found to have been untrue, incomplete or misleading in
any material respect when furnished.
2.
GUARANTY . The Guaranty supercedes that
certain Guaranty and Pledge Agreement dated August 20, 2001, by the
Guarantor in favor of the Contractor. The Guarantors jointly and
severally, unconditionally and irrevocably, guaranty to Contractor
the full and prompt payment and performance when due, whether at
maturity or earlier (by reason of acceleration) and at all times
thereafter, of all of the Obligations, and the undersigned further
agree to pay all costs and expenses including, without limitation,
all court costs and reasonable attorneys' fees and expenses paid or
incurred by the Contractor in endeavoring to collect all or any
part of the Obligations from or in prosecuting any action against,
Distributor or any of the Guarantors. Notwithstanding anything
contained in this Guaranty, the Contractor shall release the
Guarantor and terminate this Guaranty if the Contractor obtains a
replacement guaranty from a third party which is acceptable to the
Contractor in its sole and absolute discretion.
3. TERMS AND
CONDITIONS. (a) Subject to the provisions of the Contract
Documents, Contractor shall have the exclusive right to determine
the application of payments and credits, if any, received by
Contractor from the undersigned, the Distributor, the Senior
Lender, and any Customer.
(b) Contractor
is authorized, without notice or demand and without affecting the
liability of any of the Guarantors, from time to time to (i) renew,
extend, accelerate or otherwise change the time for payment or
performance of, or other terms relating to, the Obligations or any
of them, or otherwise modify, amend or change the terms of the
Contract Documents or any of them, or any other agreement, document
or instrument now or here after executed by the Distributor and
delivered to Contractor: (ii) accept partial payments on or
performance of the Obligations; and (iii) settle, release,
compromise, collect or otherwise liquidate the Obligations in any
manner, without affecting or impairing the Obligations of the
undersigned.
(c) At any time
after a Default, Contractor may at its discretion, upon notice to
the Guarantors and regardless of the acceptance of any security or
collateral for the payment. appropriate and apply toward the
payment and satisfaction of the Obligations (i) any indebtedness
due or to become due from Contractor to one or more of
