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Exhibit
10.3
UNLIMITED CONTINUING
GUARANTY
THIS UNLIMITED CONTINUING
GUARANTY (this “Guaranty Agreement”), dated as of
December 7, 2007, is made by QC E-Services, Inc., a Kansas
corporation, QC Auto Services, Inc., a Kansas corporation and QC
Loan Services, Inc., a Kansas corporation (each individually a
“Guarantor” and collectively, the
“Guarantors”), for the benefit of U.S. BANK NATIONAL
ASSOCIATION , a national banking association organized and
existing under the laws of the United States, as agent (in such
capacity, the “Agent”) for each of the lenders (the
“Lenders”) now or hereafter party to the Amended and
Restated Credit Agreement (as defined below). All capitalized terms
used but not otherwise defined herein shall have the meanings
ascribed to such terms in the Amended and Restated Credit Agreement
(as defined below).
W I T N E S S E T
H:
WHEREAS, the Lenders
have agreed to provide to QC Holdings, Inc., a Kansas corporation
(“Borrower”) revolving credit (which includes
provisions permitting the issuance of letters of credit), swingline
and term loan facilities pursuant to the terms of that certain
Amended and Restated Credit Agreement dated as of December 7,
2007, among the Borrower, the Agent and the Lenders (as from time
to time amended, modified, supplemented or restated, the
“Amended and Restated Credit Agreement”);
and
WHEREAS, each
Guarantor is owned, directly or indirectly, by Borrower and will
materially benefit from the Loans made and the Letters of Credit
issued and to be issued, under the Amended and Restated Credit
Agreement to Borrower; and
WHEREAS, each
Guarantor is required to enter into this Guaranty Agreement
pursuant to the terms of the Amended and Restated Credit Agreement;
and
WHEREAS, a material
part of the consideration given in connection with and as an
inducement to the execution and delivery of the Amended and
Restated Credit Agreement by the Agent and the Lenders was the
obligation of the Borrower to cause each Guarantor to enter into
this Guaranty Agreement; and
WHEREAS, the Lenders
are unwilling to extend and/or maintain the credit facilities
provided under the Loan Documents unless each Guarantor enters into
this Guaranty Agreement;
NOW, THEREFORE, in
consideration of the premises and mutual covenants contained
herein, the parties hereto agree as follows:
1. Guaranty .
Each Guarantor hereby unconditionally, absolutely, continually and
irrevocably guarantees, on a joint and several basis, to the Agent
for the benefit of the Lenders the payment and performance in full
of the Borrower’s Liabilities (as defined below). For all
purposes of this Guaranty Agreement, “Borrower’s
Liabilities” means: (a) the Borrower’s prompt
payment in full, when due or declared due and at all such times, of
all Obligations and all other amounts pursuant to the terms of the
Amended and Restated Credit Agreement, the Notes, and all other
Loan Documents heretofore, now or at any time or times hereafter
owing, arising, due or payable from the Borrower to the Agent or
any one or more of the Lenders, including principal, interest,
premiums and fees (including, but not limited to, loan fees and
attorneys’ fees
and expenses); (b) the
Borrower’s prompt, full and faithful performance, observance
and discharge of each and every agreement, undertaking, covenant
and provision to be performed, observed or discharged by the
Borrower under the Amended and Restated Credit Agreement and all
other Loan Documents; and (c) the Borrower’s prompt
payment in full, when due or declared due and at all such times, of
any obligations now or hereafter arising under any interest rate or
currency swap, rate cap or similar transaction (the “Hedge
Agreements”). The Guarantors’ obligations to the Agent
and the Lenders under this Guaranty Agreement are hereinafter
referred to as the “Guarantors’ Obligations”.
Notwithstanding the foregoing, the liability of each Guarantor with
respect to the Guarantors’ Obligations shall be limited to an
aggregate amount equal to the largest amount that would not render
its obligations hereunder subject to challenge under
Section 548 of the United States Bankruptcy Code or any
comparable provisions of any applicable state law.
Each Guarantor agrees that it
is directly and primarily liable on a joint and several basis
(subject to the limitation in the immediately preceding sentence)
for the Borrower’s Liabilities.
The Guarantors’
Obligations are secured by various security instruments referred to
in the Amended and Restated Credit Agreement, including without
limitation the Subsidiary Security Agreement.
2. Payment . If
the Borrower shall default in payment or performance of the
Borrower’s Liabilities, whether principal, interest, premium,
fee (including, but not limited to, loan fees and attorneys’
fees and expenses), or otherwise, when and as the same shall become
due, and after expiration of any applicable grace period, whether
according to the terms of the Amended and Restated Credit
Agreement, by acceleration, or otherwise, or upon the occurrence
and during the continuance of any Event of Default under the
Amended and Restated Credit Agreement, then each Guarantor will,
upon demand thereof by the Agent, fully pay to the Agent, for the
benefit of the Lenders, subject to any restriction on the
Guarantors’ Obligations set forth in Section 1 hereof,
an amount equal to all the Borrower’s Liabilities then due
and owing.
3. Absolute Rights and
Obligations . This is a guaranty of payment and not of
collection. The Guarantors’ Obligations under this Guaranty
Agreement shall be joint and several, absolute and unconditional
irrespective of, and each Guarantor hereby expressly waives, to the
extent permitted by law, any defense to its obligations under this
Guaranty Agreement and all security instruments to which it is a
party by reason of:
(a) any lack of legality,
validity or enforceability of the Amended and Restated Credit
Agreement, of any of the Notes, of any other Loan Document, or of
any other agreement or instrument creating, providing security for,
or otherwise relating to any of the Guarantors’ Obligations,
the Borrower’s Liabilities, or any other guaranty of any of
the Borrower’s Liabilities (the Loan Documents and all such
other agreements and instruments being collectively referred to as
the “Related Agreements”);
(b) any exercise of any right
or power under any of the Related Agreements, any failure or
omission to enforce any right conferred thereby, or any waiver of
any covenant or condition therein provided;
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(c) any permitted
acceleration of the maturity of the Borrower’s Liabilities,
of the Guarantors’ Obligations, or of any other obligations
or liabilities of any Person under any of the Related
Agreements;
(d) any release, exchange,
non-perfection, lapse in perfection, disposal, deterioration in
value, or impairment of any security for the Borrower’s
Liabilities, for any of the Guarantors’ Obligations, or for
any other obligations or liabilities of any Person under any of the
Related Agreements;
(e) any dissolution of any
Borrower or any Guarantor or any other party to a Related
Agreement, or the combination or consolidation of Borrower or any
Guarantor or any other party to a Related Agreement into or with
another entity or any transfer or disposition of any assets of
Borrower or any Guarantor or any other party to a Related
Agreement;
(f) any extension (including
without limitation extensions of time for payment), renewal,
amendment, restructuring or restatement of, and any acceptance of
late or partial payments under, the Amended and Restated Credit
Agreement, any of the Notes or any other Loan Document or any other
Related Agreement, in whole or in part;
(g) the existence, addition,
modification, termination, reduction or impairment of value, or
release of any other guaranty (or security therefor) of the
Borrower’s Liabilities;
(h) any waiver of,
forbearance or indulgence under, or other consent to any change in
or departure from any term or provision contained in the Amended
and Restated Credit Agreement, any other Loan Document or any other
Related Agreement, including without limitation any term pertaining
to the payment or performance of the Borrower’s Liabilities,
any of the Guarantors’ Obligations, or any of the obligations
or liabilities of any party to any other Related Agreement;
and
(i) any other circumstance
whatsoever (with or without notice to or knowledge of Guarantor)
which may or might in any manner or to any extent vary the risks of
Guarantor, or might otherwise constitute a legal or equitable
defense available to, or discharge of, a surety or a guarantor,
including without limitation any right to require or claim that
resort be had to the Borrower or any other Guarantor or to any
collateral in respect of the Borrower’s Liabilities or
Guarantors’ Obligations.
It is the express purpose and
intent of the parties hereto that this Guaranty Agreement and the
Guarantors’ Obligations hereunder shall be absolute and
unconditional under any and all circumstances and shall not be
discharged except by payment as herein provided.
4. Currency and Funds
of Payment . All Guarantors’ Obligations will be paid
in lawful currency of the United States of America and in
immediately available funds, regardless of any law, regulation or
decree now or hereafter in effect that might in any manner affect
the Borrower’s Liabilities, or the rights of any Secured
Party with respect thereto as against any Borrower, or cause or
permit to be invoked any alteration in the time, amount or manner
of payment by the Borrower of any or all of the Borrower’s
Liabilities.
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5. Events of
Default . Without limiting the provisions of
Section 2 hereof, in the event that there shall occur
and be continuing an Event of Default, then notwithstanding any
collateral or other security or credit support for the
Borrower’s Liabilities, at the Agent’s election and
without notice thereof or demand therefor, the Guarantors’
Obligations shall immediately be and become due and
payable.
6. Subordination
. Until this Guaranty Agreement is terminated in accordance
with Section 23 hereof, each Guarantor hereby
unconditionally subordinates all present and future debts,
liabilities or obligations now or hereafter owing to such Guarantor
(i) of the Borrower, to the payment in full of the
Borrower’s Liabilities, and (ii) of every other
Guarantor (an “obligated guarantor”), to the payment in
full of the Guarantors’ Obligations of such obligated
guarantor. All amounts due under such subordinated debts,
liabilities, or obligations shall, upon the occurrence and during
the continuance of an Event of Default, be collected and, upon
request by the Agent, paid over forthwith to the Agent for the
benefit of the Lenders on account of the Borrower’s
Liabilities, the Guarantors’ Obligations, or such other
obligations, as applicable, and, after such request and pending
such payment, shall be held by such Guarantor as agent and bailee
of the Agent and the Lenders separate and apart from all other
funds, property and accounts, of such Guarantor.
7. Suits . In
the event there shall occur and be continuing an Event of Default,
each Guarantor from time to time shall pay to the Agent for the
benefit of the Lenders, on demand, at the Agent’s place of
business set forth in the Amended and Restated Credit Agreement or
such other address as the Agent shall give notice of to Guarantor,
the Guarantors’ Obligations as they become or are declared
due, and in the event such payment is not made forthwith, the Agent
may proceed to suit against each Guarantor. At the Agent’s
election, one or more and successive or concurrent suits may be
brought hereon by the Agent against each Guarantor, whether or not
suit has been commenced against the Borrower, any other Guarantor,
or any other Person and whether or not the Agent has taken or
failed to take any other action to collect all or any portion of
the Borrower’s Liabilities or have taken or failed to take
any actions against any collateral securing payment or performance
of all or any portion of the Borrower’s Liabilities, and
irrespective of any event, occurrence, or condition described in
Section 3 hereof.
8. Set-Off and
Waiver . Each Guarantor waives any right to assert against
any Secured Party as a defense, counterclaim, set-off, recoupment
or cross claim, any defense (legal or equitable) or other claim
which such Guarantor may now or at any time hereafter have against
Borrower or any Secured Party (with respect to Secured Party, this
waiver shall not apply to a defense, counterclaim set-off,
recoupment or cross claim arising solely out of Secured
Party’s gross negligence or willful misconduct) without
waiving any additional defenses, set-offs, counterclaims or other
claims otherwise available to such Guarantor. Each Guarantor agrees
that each Secured Party shall have a lien for all the
Guarantors’ Obligations upon all deposits or deposit
accounts, of any kind, or any interest in any deposits or deposit
accounts, now or hereafter pledged, mortgaged, transferred or
assigned to such Secured Party or otherwise in the possession or
control of such Secured Party for any purpose (other than solely
for safekeeping) for the account or benefit of such Guarantor,
including any balance of any deposit account or of
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any credit of such Guarantor with the
Secured Party, whether now existing or hereafter established, and
hereby authorizes each Secured Party from and after the occurrence
of an Event of Default at any time or times with or without prior
notice to apply such balances or any part thereof to such of the
Guarantors’ Obligations to the Agent and the Lenders then due
and in such amounts as provided for in the Amended and Restated
Credit Agreement. For the purposes of this Section 8 ,
all remittances and property shall be deemed to be in the
possession of the Agent or a Lender as soon as the same may be put
in transit to it by mail or carrier or by oth
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