EXHIBIT 10.26
GUARANTY AND SURETYSHIP AGREEMENT
This Guaranty and Suretyship Agreement (this "Agreement" or the
"Guaranty") is made as of the 17th day of June, 2004 by William
F.
Wright ("Guarantor") in favor of AMCON Distributing Company, Inc.,
a
Delaware corporation ("AMCON"). Capitalized terms not
elsewhere
defined herein shall have the meanings set forth in that certain
Asset
Purchase Agreement (the "Asset Purchase Agreement") dated as of
April
24, 2004, as amended among AMCON, TSL Acquisition Corp, a
Delaware
corporation and a wholly-owned subsidiary of AMCON (the "Sub").
RECITALS
A. The Sub has
purchased substantially all of the assets of Trinity
pursuant to the terms of the Asset Purchase Agreement;
B. In connection with
the transactions contemplated by the Asset
Purchase Agreement, the Sub has issued to Trinity (a) a
Promissory
Note in the original principal amount of FIVE HUNDRED THOUSAND
DOLLARS
($500,000) (the "Three Year Note"); (b) a Promissory Note in
the
original principal amount of TWO MILLION EIGHT HUNDRED
TWENTY-EIGHT
THOUSAND FOUR HUNDRED FORTY AND 00/100 DOLLARS ($2,828,440.00)
(the
"Ten Year Note"); and (c) pursuant to Section 11.1 of the Asset
Purchase Agreement, certain royalty payment obligations with
respect
to the sale of water after the date hereof (the "Water
Royalty");
C. As a condition to
Trinity's obligation to enter into the Asset
Purchase Agreement and perform its obligations thereunder,
AMCON
entered into a Guaranty and Suretyship Agreement (the "AMCON
Guaranty") to guaranty the Sub's payment obligations under the
Three
Year Note, the Ten Year Note and the Water Royalty, subject to
certain
limitations set forth therein;
D. AMCON and LaSalle
Bank National Association (in its individual
capacity, "LaSalle"), a national banking association for itself, as
a
Lender, and as Agent ("Agent"), for all lenders that are now or
hereafter parties to the Loan Agreement (as defined below) (the
"Lenders"), Gold Bank, a Kansas state bank ("Gold Bank"), as a
Lender,
have entered into that certain Loan and Security Agreement dated
June
1, 2001 as amended from time to time (the "Loan Agreement");
E. As partial
inducement for the Agent to consent to the transactions
contemplated by the Asset Purchase Agreement in order to avoid
a
default under the Loan Agreement, Guarantor has entered into
this
Agreement to guaranty any and all indebtedness of AMCON to
Trinity
under the AMCON Guaranty, subject to certain limitations set
forth
therein and herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Guarantor hereby agrees as follows:
AGREEMENT
1. Definitions.
Capitalized terms used
in this Agreement, unless
otherwise defined in this Agreement, shall have the meanings
ascribed
to them in the Asset Purchase Agreement.
2. Representations and
Warranties. Guarantor
hereby represents and
warrants to AMCON as follows:
(i)
The execution
and delivery by Guarantor of this Agreement
and the performance by Guarantor of its obligations hereunder do
not
and will not contravene or conflict with any law, regulation or
rule,
any license, agreement, or instrument to which Guarantor is a party
or
by which Guarantor or any of Guarantor's property may be bound
or
affected, or any judgment, order or decree of any court of any
federal, state, or local commission, board, or other
administrative
agency by which Guarantor or any of Guarantor's property may be
bound
or affected.
(ii)
This Agreement is the
legal, valid, and binding obligation
of Guarantor, enforceable against Guarantor in accordance with
its
terms.
3. Guaranty. Guarantor
absolutely, irrevocably and unconditionally
guaranties the prompt payment when due of (i) all amounts that
AMCON
is legally required to pay and pays to Trinity under the Three
Year
Note, the Ten Year Note and the Water Royalty (each in accordance
with
their respective terms), including, without limitation, costs
and
expenses of collection, which shall include reasonable attorneys
fees
and paralegals' fees and all court costs, plus (ii) interest on
the
amount of any such payment computed at the highest rate provided
in
the Loan Agreement; provided that, Guarantor's total payment
obligations with respect to its guaranty of the Water Royalty shall
in
no event exceed $5,000,000 in the aggregate (collectively referred
to
herein as the "Obligations"). Notwithstanding anything to
the
contrary contained herein, to satisfy the Obligations when due,
AMCON
shall be entitled to make a claim against all or any portion of
the
assets of Guarantor. Guarantor further agrees that:
(a) This Guaranty is in all respects
continuing, absolute, and
unconditional.
(b) This Guaranty is a guaranty of
both performance and payment
when due, and not of collection.
(c) AMCON may, from time to time, at
AMCON's sole discretion and
without notice to Guarantor, take any or all of the following
actions:
(i)
Accept
