EXHIBIT 10.4
GUARANTY BY CORPORATION
AGREEMENT made this 31st day of August, 2005, by IntriCon
Corporation, a Pennsylvania corporation
(herein called "Guarantor"), for the
benefit of Diversified Business Credit,
Inc., a Minnesota corporation (herein
with its participants, successors and
assigns called "Lender").
For good and valuable consideration, the receipt and
sufficiency
of which are hereby acknowledged, and to
induce Lender from time to time to make
one or more loans or extend other financial
accommodations at the discretion of
Lender to Resistance Technology, Inc., a
Minnesota corporation and RTI
Electronics, Inc., a Delaware corporation
(herein collectively called
"Borrower"), Guarantor hereby guarantees
and agrees as follows:
Guarantor hereby absolutely and unconditionally guarantees to
Lender the full and prompt payment when due
(whether on demand or at a stated
maturity or earlier by reason of
acceleration or otherwise) of any and all
present and future debts, liabilities and
obligations owed to Lender by
Borrower; and Guarantor represents,
warrants and agrees that:
1. The debts, liabilities and obligations guaranteed hereby
(collectively referred to herein as the
"Indebtedness") shall include, but shall
not be limited to, debts, liabilities and
obligations of Borrower arising out of
loans, credit transactions, financial
accommodations, discounts, purchases of
property or other transactions with
Borrower or for Borrower's account or out of
any other business transaction, or event,
owed to Lender or owed to others by
reason of participations granted to or
interests acquired or created for or sold
to them by Lender, in each case whether now
existing or hereafter arising,
whether arising directly in a transaction
or event involving Lender or acquired
by Lender from another by purchase or
assignment or as collateral security,
whether owed by Borrower as drawer, maker,
endorser, accommodation party,
guarantor, principal, surety or as a member
of any partnership, syndicate,
association or group or in any other
capacity, whether absolute or contingent,
direct or indirect, primary or secondary,
joint, several or joint and several,
secured or unsecured, due or not due,
liquidated or unliquidated, arising by
agreement or imposed by law or
otherwise.
2. Guarantor represents and warrants to Lender that (i)
Guarantor is a corporation duly organized
and existing in good standing under
the laws of the state set forth above, has
the corporate power to own its
property and to carry on its business as
now conducted, and is duly qualified to
do business in all states where such
qualification is required; (ii) Guarantor
has full power and authority to execute,
deliver and perform this Agreement;
(iii) the execution, delivery and
performance of this Agreement have been duly
authorized by all necessary action of the
directors and shareholders of
Guarantor and do not and will not violate
the provisions of, or constitute a
default under, any provision of law or the
articles of incorporation or by-laws
of Guarantor or any agreement binding on
Guarantor or on Borrower; (iv) this
Agreement has been duly executed and
delivered by authorized officers of
Guarantor and constitutes a lawful, valid
and binding obligation of Guarantor,
legally enforceable against it in
accordance with its terms; (v) no litigation,
tax claims or governmental proceedings are
pending or have been threatened
against Guarantor, and no judgment or order
of any court or administrative
agency is outstanding against Guarantor;
and (vi) the authorization, execution,
delivery and performance of this Agreement
will not be subject to the
jurisdiction, approval or consent of any
federal, state or local regulatory body
or administrative agency.
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3. No act or thing need occur to establish the liability of
Guarantor hereunder, and no act or thing,
except full payment and discharge of
all Indebtedness, shall in any way
exonerate Guarantor or modify, reduce, limit
or release its liability hereunder. This is
an absolute, unconditional and
continuing guaranty of payment of the
Indebtedness and shall continue to be in
force and be binding upon Guarantor,
whether or not all Indebtedness is paid in
full, until this guaranty is revoked
prospectively as to future transactions, by
written notice actually received by Lender,
and such revocation shall not be
effective as to Indebtedness existing or
committed for at the time of actual
receipt of such notice by Lender, or as to
any renewals, extensions and
refinancings thereof. Any dissolution,
adjudication of bankruptcy or disability
or incapacity of Guarantor shall not revoke
this guaranty, except upon actual
receipt of written notice thereof by Lender
and then only prospectively, as to
future transactions, as herein set
forth.
4. Guarantor further represents and warrants to Lender that
Guarantor is affiliated with Borrower and
has a direct and substantial economic
interest in Borrower and has received and
expects to continue receiving
substantial benefits therefrom and from any
loan, credit transactions, financial
accommodations, discounts, purchases of
property and other transactions and
events resulting in the creation of
Indebtedness, and that this Guaranty is made
and delivered for a corporate purpose.
Guarantor agrees promptly to notify
Lender in writing and revoke this Guaranty
prospectively (as to future
Indebtedness not outstanding or committed
for) in accordance with paragraph 3 if
at any time, in the opinion of Guarantor's
directors or management, Guarantor is
not receiving corporate benefits sufficient
to warrant the continuance of this
guaranty as to future Indebtedness of
Borrower. Accordingly, so long as this
Guaranty is not revoked prospectively in
accordance with paragraph 3, the Lender
may rely conclusively on a warranty, hereby
made, that Guarantor is continuing
to be benefited by this Guaranty and the
Lender shall have no duty to inquire
into or confirm the receipt of any such
benefits, and this Guaranty shall be
effective and enforceable by the Lender
without regard to the existence, nature
or value of any such benefits.
5. If Guarantor shall be dissolved, shall be or become
insolvent, or shall initiate or have
initiated against Guarantor any act,
process or proceeding under the United
States Bankruptcy Code or any other
bankruptcy, insolvency or reorganization
law or otherwise for the modification
or adjustment of the rights of creditors,
then Guarantor will forthwith pay to
Lender the full amount of all Indebtedness
then outstanding, whether or not any
Indebtedness is
