THIS GUARANTY
AGREEMENT (this “Agreement”) is entered into as of
July 17, 2009, by ASSURANCEAMERICA MANAGING GENERAL AGENCY
LLC, a Delaware limited liability company (the
“Guarantor”) with an address as set forth on the
signature page to this Agreement, in favor of WACHOVIA BANK,
NATIONAL ASSOCIATION (“Lender”) with an address at
171 17th Street NW, 5th Floor, MC: GA4507 Atlanta, Georgia
30363.
Guarantor has
requested that Lender extend a $1,500,000.00 line of credit to
Assurance America Corporation (“Borrower”) (the
“Loan Facility”) under the terms of that certain Loan
Agreement dated as of even date herewith (as amended or otherwise
modified from time to time, the “Loan Agreement”), and
Lender has agreed to provide such Loan Facility to Borrower on the
condition that Guarantor execute and deliver this Agreement to
Lender to secure the payment of the Loan Facility.
NOW, THEREFORE, in
consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1.
Definitions . Capitalized terms not defined herein have the
respective meanings provided for in the Loan Agreement.
SECTION 2.
Representations and Warranties . Guarantor represents and
warrants (which representations and warranties shall be deemed to
have been renewed by Guarantor upon each delivery of a compliance
certificate under the Loan Agreement) that: (a) this Agreement
has been duly and validly executed and delivered by Guarantor and
constitutes Guarantor’s legal, valid and binding obligation,
enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or moratorium or other similar laws relating to the
enforcement of creditors’ rights generally and by general
equitable principles; (b) neither the execution and delivery
by Guarantor of this Agreement nor compliance with the terms and
provisions hereof by Guarantor will conflict with or result in a
breach of, or require any consent under, any applicable law or
regulation, or any order, writ, injunction or decree of any court
or governmental authority or agency, or any material agreement or
instrument to which Guarantor is a party or by which Guarantor is
bound or to which Guarantor is subject, or constitute a default
under any such agreement or instrument, or result in the creation
or imposition of any lien upon any of Guarantor’s revenues or
assets pursuant to the terms of any such agreement or instrument;
and (c) after giving effect to the execution and delivery of
the Loan Documents to which Guarantor is a party and the incurring
of its obligations hereunder, Guarantor, Borrower and each of
Borrower’s Subsidiaries, collectively, will not be (i)
“insolvent,” within the meaning of such term as defined
in § 101 of Title 11 of the United States Code or § 2 of
either the Uniform Fraudulent Transfer Act or the Uniform
Fraudulent Conveyance Act, as each is amended from time to time, or
(ii) unable to pay Guarantor’s debts generally as such
debts become due, or have an unreasonably small capital to engage
in any business or transaction, whether current or
contemplated.
SECTION 3. The
Guaranty . Guarantor hereby, jointly and severally with each
other guarantor of the Guaranteed Obligations (defined below),
unconditionally and irrevocably, guarantees the full and punctual
payment (whether at stated maturity, upon acceleration or
otherwise) of all loans under the Loan Facility, interest thereon
and all other Obligations (defined in the Loan Agreement)
(collectively the “Guaranteed Obligations”). Upon
failure by Borrower to pay punctually any such Guaranteed
Obligations, Guarantor agrees Guarantor shall forthwith on demand
pay the amount not so paid at the place and in the manner specified
in the Loan Agreement, the Note or the relevant Loan Document, as
the case may be. This guaranty is a guaranty of payment and
performance and not of collectibility and in no way conditional or
contingent. Without limiting the generality of the foregoing, this
Agreement is in no way conditioned upon any requirement that Lender
first attempt to obtain or collect payment, or seek observance or
performance, of any of the Guaranteed Obligations from any person
or entity which is or may become directly or indirectly liable or
responsible for any of the Guaranteed Obligations, or resort to any
other collateral or security or other means of obtaining or
collecting payment or seeking observance or performance of any of
the Guaranteed Obligations, or upon any other contingency
whatsoever. Each and every default in the payment, observance or
performance of any of the Guaranteed Obligations shall give rise to
a separate cause of action under this Agreement and separate suits,
actions or proceedings may be brought hereunder as and when any
such cause of action arises.
SECTION 4.
Guaranty Unconditional . The obligations of Guarantor
hereunder shall be unconditional, irrevocable, continuing and
absolute and, without limiting the generality of the foregoing,
shall not be released, discharged or otherwise affected by:
(i) any extension, renewal, settlement, compromise, surrender,
indulgence, forbearance, acceleration, waiver or release in respect
of any obligation of Borrower or any Guarantor (defined under the
Loan Agreement; Borrower and all Guarantors being referred to
herein as a “Loan Party”) with respect to the
Guaranteed Obligations, the Loan Agreement, the Note, or any other
Loan Document, by operation of law or otherwise; (ii) any
change in the terms of the Guaranteed Obligations, the Loan
Agreement, the Note or any other Loan Document or any amendment or
other modification to the Loan Agreement, the Note, or any other
Loan Document; (iii) any invalidity, nonattachment,
nonperfection, failure to obtain priority, release, surrender,
accept, exchange, substitution, subordination, enforcement or sale
of any part of the Collateral or any other direct or indirect
security for any Guaranteed Obligations or any other obligation of
any of the Loan Parties under the Loan Agreement, the Note, any
Loan Document, or the manner of the application of the proceeds of
any Collateral or any other direct or indirect security for any
Guaranteed Obligations; (iv) any change in the legal or
organizational structure or ownership of any of the Loan Parties,
or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting any of the Loan Parties, or its assets or any
resulting release or discharge of any obligation of any of the Loan
Parties; (v) the existence of any setoff, claim, defense,
recoupment or other rights which Guarantor may have at any time
against any of the Loan Parties, the Lender, or any other person or
entity, whether in connection herewith or any unrelated
transactions, provided that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory
counterclaim; (vi) any discharge, invalidity or
unenforceability relating to or against any of the Loan Parties,
for any reason related to the Loan Agreement, the Note, any other
Loan Document, or any other guaranty, or any provision of
applicable law or regulation purporting to prohibit the payment by
any of the Loan Parties, of the principal of or interest on the
Loans or other Guaranteed Obligations under the Loan Agreement or
any other Loan Document; (vii) receipt of any additional
Collateral or any other direct or indirect security for any
Guaranteed Obligations or any other obligation of any of the Loan
Parties under the Loan Agreement, the Note, any Loan Document; or
(viii) any and all defenses based on suretyship or any other
applicable law, all of which are hereby expressly waived, including
without limitation all rights and defenses arising out of the
following, each of which is hereby waived: (a) an election of
remedies by the Lender even though that election of remedies may
have destroyed rights of subrogation and reimbursement against any
Loan Party by operation of law or otherwise, (b) protections
afforded to any Loan Party pursuant to antideficiency or similar
laws limiting or discharging any Loan Party’s obligations to
the Lender, (c) the failure to notify any Loan Party of the
disposition of any property securing the obligations of any Loan
Party, (d) the commercial reasonableness of such disposition
or the impairment, however caused, of the value of such property,
(e) any duty of the Lender (should such duty exist) to
disclose to any Loan Party any matter, fact or thing related to the
business operations or condition (financial or otherwise) of any
Loan Party or its affiliates or property, whether now or hereafter
known by the Lender, (f) any defense of any Loan Party to
payment, (g) the benefit of any statute of limitations in
favor of Borrower or any Loan Party, (h) any defense based on
a claim that Guarantor’s obligations hereunder are more
burdensome than, or exceed those of Borrower or any Loan Party,
(i) any right to assert the doctrine of marshalling with
respect to the Collateral, (j) any defense arising from
Lender’s performance or lack of performance of any due
diligence, monitoring or examination of the Borrower, any
Collateral or any Loan Party or the exercise or non-exercise of any
right, power, privilege or remedy under the Loan Agreement, the
Note or any other Loan Document, (k) the provisions of Section
10-7-24 of O.C.G.A. or 11-3-601 O.C.G.A., or (1) any other act
or omission to act or delay of any kind by any of the Loan Parties,
the Lender or any other person or entity or any other circumstance
whatsoever which might, but for the provisions of this
Section 4, constitute a legal or equitable discharge of the
obligations of Guarantor hereunder.
SECTION 5.
Discharge Only Upon Payment In Full; Reinstatement In Certain
Circumstances . (a) Guarantor’s obligations
hereunder shall remain in full force and effect until all
Guaranteed Obligations (other than Cash Management Obligations that
continue after the termination of the Loan Facility) shall have
been paid in full and the commitments under the Loan Facility shall
have terminated or expired. If at any time any payment of the
principal of or interest on the Note o
|
