THIS GUARANTY (“Guaranty”) is made and entered
into as of this 12 th day of November, 2008, by PURE EARTH,
INC., a Delaware corporation (the “Guarantor”), in
favor of SUSQUEHANNA BANK , a Pennsylvania chartered bank
(the “Bank”) to secure the obligations of CASIE
ECOLOGY OIL SALVAGE, INC., a New Jersey corporation,
MIDATLANTIC RECYCLING TECHNOLOGIES, INC. , a Delaware
corporation, and REZULTZ, INCORPORATED , a New Jersey
corporation (collectively hereinafter
“Borrower”).
A. The Borrower has on or about the date
hereof entered into loan documents with Bank evidencing a Term
Mortgage Loan in the principal sum of EIGHT MILLION DOLLARS
($8,000,000.00) (the “Loan”), made by Bank to
Borrower pursuant to a certain Term Loan Note of even date herewith
(the “Note”), and more particularly described in that
certain Term Loan Agreement of even date herewith between Borrower
and Bank (the “Loan Agreement”).
B. As a condition to entering into the Note
and Loan Agreement and making the Loan, the Bank has requested
additional credit support and the Guarantor has agreed to execute
and deliver to the Bank an instrument guaranteeing the Obligations
of the Borrower under the Loan Agreement, the Note, and the other
loan documents referred to in the Loan Agreement (collectively the
“Loan Documents”).
C. The Guarantor has determined that the
extension of credit to the Borrower under the Loan Agreement
directly benefits, and that its execution, delivery and performance
of this Guaranty is within the business purposes and in the best
interests of, the Guarantor and has offered this Guaranty to induce
the Bank to provide the Loan to Borrower.
D. Capitalized terms used herein without
definition shall have the meanings ascribed to them in the Loan
Agreement.
NOW, THEREFORE, incorporating the Background
Section herein, in consideration of the undertakings of the Bank
pursuant to the Loan Agreement and intending to be legally bound,
Guarantor hereby agrees as follows:
Section 1. Guaranty . The
Guarantor hereby irrevocably, absolutely and unconditionally
guarantees as a primary obligor and not merely as a surety for
prompt payment of the following obligations and liabilities
(hereinafter collectively referred to as the
“Obligations”):
(a) any and all indebtedness of the
Borrower to the Bank in connection with the Loan Documents, as and
when due and payable, whether by acceleration or otherwise of all
amounts now or hereafter owing by the Borrower in connection with
the Loan Agreement, the Note, and the other Loan Documents, whether
for principal of or interest on (including interest accruing during
the pendency of any bankruptcy, insolvency, receivership or other
similar proceeding) the Loan, and the due performance and
observance by the Borrower of its other Obligations now or
hereafter existing in respect of any of the Loan Documents and any
renewals, extensions and modifications thereof; and
(b) any and all indebtedness of the
Borrower to the Bank in connection with the Environmental
Indemnification Agreement between Borrower and Bank, dated of even
date herewith, as and when due and payable, whether by acceleration
or otherwise of all amounts now or hereafter owing by the Borrower,
and any renewals, extensions and modifications thereof, and
Guarantor hereby agrees that the representations, warranties and
covenants herein shall survive the payment of the indebtedness to
Bank and the satisfaction and release of any mortgage and shall not
be affected by Lender’s acquisition of any interest in the
property, whether by foreclosure or otherwise;
(c) any and all reasonable expenses,
including, without limitation, reasonable arbitration,
attorneys’ and experts’ fees and expenses, incurred by
the Bank in enforcing its rights under this Guaranty whether
incurred without the commencement of a suit, in any suit,
arbitration or administrative proceeding or in any appellate or
bankruptcy proceeding.
Section 2.
Guarantor’s Obligations Unconditional
.
(a) The Guarantor hereby guarantees that
the Obligations will be paid in accordance with the terms of the
Loan Documents. The liability of the Guarantor hereunder shall be
absolute and unconditional, irrespective of: (i) any lack of
validity or enforceability of any such Loan Document or any
agreement or instrument relating thereto, including, without
limitation, the lack of validity or enforceability of all or any
portion of the liens or security interests granted thereby;
(ii) any change in the time, manner or place of payment of, or
in any other non-material term in respect of, all or any of the
Obligations, or any other amendment or waiver of or consent to any
non-material departure from the terms of any such Loan Document;
(iii) any exchange or release of, or non-perfection of any
lien on or security interest in, any Collateral, or any release or
amendment or waiver of or consent to any departure from the terms
of any other guaranty for all or any of the Obligations;
(iv) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Borrower or any other
guarantor or obligor in respect of the Obligations or the Guarantor
in respect hereof; or (v) the absence of any action on the
part of the Bank to obtain payment of the Obligations from the
Borrower or from the Guarantor or from any other guarantor or
obligor.
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(b) This Guaranty (i) is a continuing
and unconditional guarantee of payment and performance and not of
collection and shall remain in full force and effect until the
later to occur of (x) all of the Obligations and other
expenses guaranteed pursuant to Section 1 hereof have been
paid in full and (y) no further Loans are available under the
Loan Documents; and (ii) shall continue to be effective or
shall be reinstated, as the case may be, if at any time any payment
of any of the Obligations is rescinded, avoided or rendered void as
a preferential transfer, impermissible set-off, fraudulent
conveyance or must otherwise be returned or disgorged by the Bank
upon the insolvency, bankruptcy or reorganization of either the
Borrower or the Guarantor or otherwise, all as though such
rescinded, avoided or voided payment had not been made, and
notwithstanding any action or failure to act on the part of the
Bank in reliance on such payment.
Section 3. Waivers . The
Guarantor hereby waives (i) promptness and diligence; (ii) notice
of the incurrence of any Obligation by the Borrower; (iii) notice
of any non-material actions taken by the Bank or the Borrower under
any Loan Document or any other agreement or instrument relating
thereto; (iv) acceptance of this Guaranty and reliance thereon by
the Bank; (v) presentment, demand of payment, notice of dishonor or
nonpayment, protest and notice of protest with respect to the
Obligations, and all other formalities of every kind in connection
with the enforcement of the Obligations or of the obligations of
the Guarantor hereunder or of any other guarantor, the omission of
or delay in which, but for the provisions of this Section 3,
might constitute grounds for relieving the Guarantor of its
obligations hereunder; (vi) any requirement that the Bank protect,
secure, perfect or insure any security interest or lien or any
property constituting Collateral or exhaust any right or take any
action against the Borrower, the Guarantor, any other person or any
Collateral; and (vii) notice of any election by the Bank to sell
any of the property constituting Collateral mortgaged, assigned or
pledged as security for any of the Obligations at a public or
private sale. In general and without limitation, the Guarantor
waives all legal and equitable defenses, including all defenses
based on suretyship and impairment of collateral.
Section 4. Subrogation and Similar
Rights . The Guarantor will not exercise any rights which
it may acquire by way of subrogation, indemnification or
contribution, by reason of any payment made by it hereunder or
otherwise, until after the date on which all of the Obligations
shall have been satisfied in full and until such time, any such
rights against the Borrower shall be fully subordinate in lien and
payment to any claim which the Bank now or hereafter has against
the Borrower. If any amount shall be paid to the Guarantor on
account of such subrogation, indemnification or contribution at any
time when all of the Obligations and all other expenses guaranteed
pursuant hereto shall not have been paid in full, such amount shall
be held in trust for the benefit of the Bank, shall be segregated
from the other funds of the Guarantor and shall forthwith be paid
over to the Bank to be applied in whole or in part by the Bank
against the Obligations, whether matured or unmatured, in
accordance with the terms of the Loan Agreement. If the Guarantor
shall make payment to the Bank of all or any portion of the
Obligations and all of the Obligations shall be paid in full, the
Bank will, at the written request of the Guarantor, execute and
deliver to the Guarantor (without recourse, representation or
warranty) appropriate documents necessary to evidence the transfer
by subrogation to the Guarantor of an interest in the Obligations
resulting from such payment by the Guarantor, such subrogation to
be fully subject and subordinate, however, to the Bank’s
right to collect any other amounts which may be due to the Bank by
the Borrower.
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Section 5. Representations and
Warranties . The Guarantor hereby represents and warrants
as follows:
(a) The Guarantor (i) is a corporation
duly organized, validly existing and in good standing under the
laws of the stat
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