Exhibit 10.6
CONTINUING AND UNCONDITIONAL GUARANTY
To: BOS (USA) Inc.
     1. The Guaranty. For valuable consideration, FRANKLIN CREDIT MANAGEMENT
CORPORATION, a Delaware corporation (“Guarantor”) hereby unconditionally
guarantees the prompt and complete payment and performance of all Obligations
(as hereinafter defined) of Tribeca Lending Corp, a New York corporation
(“Borrower”) and each Company Subsidiary (as defined in the Loan Agreement
hereinafter referred to; the Borrower and the Company Subsidiaries,
collectively, the “Obligors”) to BOS (USA) Inc., its subsidiaries and affiliates
(collectively, “Lender”), or order, in lawful money of the United States. The
liability of Guarantor under this Guaranty is not limited as to the principal
amount of the Obligations guaranteed and includes, without limitation, liability
for all interest, fees, indemnities (including, without limitation, hazardous
waste indemnities), and other reasonable costs and expenses relating to or
arising out of the Obligations. This Guaranty is cumulative and does not
supersede any other outstanding guaranties, and the liability of Guarantor under
this Guaranty is exclusive of Guarantor’s liability under any other guaranties
signed by Guarantor.
     2. Definitions. (a) Unless the context indicates otherwise, the following
terms used herein have the following meanings (and shall include in the singular
number the plural and in the plural number the singular):
          “Loan Agreement” shall mean the Master Credit and Security Agreement
dated as of March 24, 2006, among Borrower, the Company Subsidiaries and Lender,
as now in effect and as hereafter amended, restated, renewed, or superseded.
          “Obligations” shall mean any and all debts, liabilities, and
obligations of each Obligor to Lender under the Loan Agreement and the other
Loan Documents (as such term is defined in the Loan Agreement), now or hereafter
existing, whether voluntary or involuntary and however arising, whether direct
or indirect or acquired by Lender by assignment, succession, or otherwise,
whether due or not due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, held or to be held by Lender for its own account or
as agent for another or others, whether such Obligor may be liable individually
or jointly with others, whether recovery upon such debts, liabilities and
obligations may be or hereafter become unenforceable for any reason. Obligations
includes, without limitation, any and all obligations of any Obligor to Lender
for reasonable attorneys’ fees and all other reasonable costs and expenses
incurred by Lender in the collection or enforcement of any debts, liabilities,
and obligations of any Obligor to Lender under the Loan Documents. Unless the
context indicates otherwise, capitalized terms used herein and not otherwise
defined shall have the meanings provided for such terms (directly or by
cross-reference) in the Loan Agreement.
     3. Obligations Independent. The obligations hereunder are independent of
the obligations of each Obligor or any other guarantor, and a separate action or
actions may be brought and prosecuted against Guarantor whether action is
brought against any Obligor or any other guarantor or whether any Obligor or any
other guarantor be joined in any such action or actions. Anyone executing this
Guaranty shall be bound by its terms without regard to execution by anyone else.

 

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     4. Rights of Lender. (i) Guarantor acknowledges that Lender, without notice
or demand and without affecting its liability hereunder, may from time to time
to:
          (a) Intentionally omitted;
          (b) receive and hold security for the payment of this Guaranty or any
Obligations and exchange, enforce, waive, release, fail to perfect, sell, or
otherwise dispose of any such security;
          (c) apply such security and direct the order or manner of sale thereof
as Lender in its discretion may determine;
          (d) release or substitute any Guarantor or any one or more of any
endorsers or other guarantors of any of the Obligations; and
          (e) permit the Obligations to exceed Guarantor’s liability under this
Guaranty, and Guarantor agrees that any amounts received by Lender from any
source other than Guarantor shall be deemed to be applied first to any portion
of the Obligations not guaranteed by Guarantor.
     (ii) This Guaranty to Lender is a continuing guaranty which applies to any
renewal, compromise, extension, acceleration, or otherwise that may change the
time for payment, or otherwise change the terms of the Obligations or any part
thereof, including increase or decrease of the rate of interest thereon, or
otherwise result in a change the terms of any Loan Documents; provided however,
that any renewal, compromise, extension, acceleration, or change is by agreement
of the parties to the applicable Loan Document, or pursuant to the terms and
conditions thereof.
Lender acknowledges that nothing in this Guaranty grants Lender the right to
unilaterally amend any of the terms of the Loan Agreement or any other Loan
Document.
     5. Guaranty to be Absolute. Guarantor agrees that until the Obligations
have been paid in full and any commitments of Lender or facilities provided by
Lender with respect to the Obligations have been terminated, Guarantor shall not
be released by or because of the taking, or failure to take, any action that
might in any manner or to any extent vary the risks of Guarantor under this
Guaranty or that, but for this paragraph, might discharge or otherwise reduce,
limit, or modify Guarantor’s obligations under this Guaranty. Guarantor waives
and surrenders any defense to any liability under this Guaranty based upon any
such action, including but not limited to any action of Lender described in the
immediately preceding paragraph of this Guaranty. It is the express intent of
Guarantor that Guarantor’s obligations under this Guaranty are and shall be
absolute and unconditional.
     6. Guarantor’s Waivers of Certain Rights and Certain Defenses. Guarantor
waives:
          (a) any right to require Lender to proceed against any Obligor,
proceed against or exhaust any security for the Obligations, or pursue any other
remedy in Lender’s power whatsoever;

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          (b) any defense arising by reason of any disability or other defense
of any Obligor, or the cessation from any cause whatsoever of the liability of
any Obligor; and
          (c) any defense based on any claim that Guarantor’s obligations exceed
or are more burdensome than those of any Obligor.
     No provision or waiver in this Guaranty shall be construed as limiting the
generality of any other waiver contained in this Guaranty.
     7. Waiver of Subrogation. Until the Obligations have been paid in full and
any commitments of Lender or facilities provided by Lender with respect to the
Obligations have been terminated, even though the Obligations may be in excess
of Guarantor’s liability hereunder, Guarantor waives to the extent permitted by
applicable law any right of subrogation, reimbursement, indemnification, and
contribution (contractual, statutory, or otherwise) including, without
limitation, any claim or right of subrogation under the Bankruptcy Code (Title
11, United States Code) or any successor statute, arising from the existence or
performance of this Guaranty, and Guarantor waives to the extent permitted by
applicable law any right to enforce any remedy that Lender now has or may
hereafter have against any Obligor, and waives any benefit of, and any right to
participate in, any security now or hereafter held by Lender.
     8. Waiver of Notices. Guarantor waives all presentments, demands for
performance, notices of nonperformance, protests, notices of protest, notices of
dishonor, notices of intent to accelerate, notices of acceleration, notices of
any suit or any other action against any Obligor or any other person, any other
notices to any party liable on any Loan Document (including Guarantor), notices
of acceptance of this Guaranty, notices of the existence, creation, or incurring
of new or additional Obligations to which this Guaranty applies or any other
Obligations of any Obligor to Lender, and notices of any fact that might
increase Guarantor’s risk.
     9. [Intentionally deleted]
     10. [Intentionally deleted].
     11. Reinstatement of Guaranty. If this Guaranty is terminated for any
reason, and subsequently any payment or transfer of any interest in property by
any Obligor to Lender is rescinded or must be returned by Lender to any Obligor,
this Guaranty shall be reinstated with respect to any such payment or transfer,
regardless of any such prior revocation, return, or cancellation.
     12. Stay of Acceleration. In the event that acceleration of the time for
payment of any of the Obligations is stayed upon the insolvency, bankruptcy, or
reorganization of any Obligor or otherwise, all such Obligations guaranteed by
Guarantor shall nonetheless be payable by Guarantor immediately if requested by
Lender.
     13. No Setoff or Deductions; Taxes. Guarantor represents and warrants that
it is organized and resident in the United States of America. All payments by
Guarantor hereunder shall be paid in full, without setoff or counterclaim or any
deduction or withholding whatsoever, including, without limitation, for any and
all present and future taxes.

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     14. Information Relating to Obligors. Guarantor acknowledges and agrees
that it shall have the sole responsibility for, and has adequate means of,
obtaining from each Obligor such information concerning such Obligor’s financial
condition or business operations as Guarantor may require, and that Lender has
no duty, and Guarantor is not relying on Lender, at any time to disclose to
Guarantor any information relating to the business operations or financial
condition of any Obligor.
     15. Obligors’ Authorization. Where any Obligor is a corporation,
partnership, or limited liability company, it is not necessary for Lender to
inquire into the powers of such Obligor or of the officers, directors, partners,
members, managers, or agents acting or purporting to act on its behalf, and any
Obligations made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder, subject to any limitations on Guarantor’s
liability set forth herein.
     16. Representations and Warranties. Guarantor represents and warrants that:
          (a) Guarantor is a corporation duly incorporated and validly existing
under the laws of the jurisdiction of its incorporation.
          (b) The execution, delivery and performance of this Guaranty will not
contravene any law, rule or regulation, or any judgment or order, applicable to
Guarantor, or conflict or be inconsistent with or result in any breach of any
contract, agreement or instrument to which Guarantor or any of its properties or
assets is subject, or result in the creation or imposition of (or the obligation
to create or impose) any Lien upon any of the property or assets of Guarantor,
or violate any provision of the corporate charter or by-laws of Guarantor.
          (c) The execution, delivery and performance of this Guaranty is within
the corporate powers of Guarantor and has been duly authorized by all necessary
corporate action.
          (d) This Guaranty constitutes a valid and binding obligation of
Guarantor enforceable against Guarantor in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and except as enforceability may be subject to
general principles of equity, whether such principles are applied in a court of
equity or at law.
          (e) No order, permission, consent, approval, license, authorization,
registration or validation of, or filing with, or exemption by, any governmental
authority is required to authorize, or is required in connection with, the
execution, delivery and performance of this Guaranty, or the taking of any
action contemplated hereby or thereby.
     17. Setoff. Upon the occurrence and during the continuance of any Event of
Default, Lender may, at its option and without notice or demand to the extent
not prohibited by law, set off against any or all liabilities of Guarantor all
money owed by Lender or any of its agents or affiliates in any capacity to
Guarantor, whether or not due, and also set off against all other liabilities of
Guarantor to Lender all money owed by Lender in any capacity to Guarantor. If
exercised by Lender, Lender shall be deemed to have exercised such right of
setoff and to have

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made a charge against any such money immediately upon the occurrence of such
default although made or entered on the books subsequent thereto.
     18. Notices. All notices required under this Guaranty shall be personally
delivered or sent by first class mail, postage prepaid, or by overnight courier,
to the addresses on the signature page of this Guaranty, or to such other
addresses as Lender and Guarantor may specify from time to time in writing.
Notices sent by (a) first class mail shall be deemed delivered on the earlier of
actual receipt or on the fourth business day after deposit in the U.S. mail,
postage prepaid, and (b) overnight courier shall be deemed delivered on the next
business day.
     19. Successors and Assigns. This Guaranty (a) binds Guarantor and
Guarantor’s executors, administrators, successors, and assigns, provided that
Guarantor may not assign its rights or obligations under this Guaranty without
the prior written consent of Lender, and (b) inures to the benefit of Lender and
Lender’s indorsees, successors, and assigns. Subject to compliance with the
terms of Section 11.5 and 11.9 of the Loan Agreement, Lender may, without notice
to Guarantor and without affecting Guarantor’s obligations hereunder, sell,
assign, grant participations in, or otherwise transfer to any other person,
firm, or corporation the Obligations and this Guaranty, in whole or in part.
Guarantor agrees that Lender may disclose to any assignee or purchaser, or any
prospective assignee or purchaser (subject in each case to compliance with the
terms of Section 11.15 of the Loan Agreement), of all or part of the Obligations
any and all information in Lender’s possession concerning Guarantor, this
Guaranty, and any security for this Guaranty.
     20. Amendments, Waivers, and Severability. No provision of this Guaranty
may be amended or waived except in writing. No failure by Lender to exercise,
and no delay in exercising, any of its rights, remedies, or powers shall operate
as a waiver thereof, and no single or partial exercise of any such right,
remedy, or power shall preclude any other or further exercise thereof or the
exercise of any other right, remedy, or power. The unenforceability or
invalidity of any provision of this Guaranty shall not affect the enforceability
or validity of any other provision of this Guaranty.
     21. Costs and Expenses. Guarantor agrees to pay all reasonable attorneys’
fees, and all other costs and expenses that may be incurred by Lender (a) in the
enforcement of this Guaranty or (b) in the preservation, protection, or
enforcement of any rights of Lender in any case commenced by or against
Guarantor or any Obligor under the Bankruptcy Code (Title 11, United States
Code) or any similar or successor statute.
     22. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO CHOICE
OF LAW DOCTRINE THAT WOULD RESULT IN THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.
     23. Jurisdiction. GUARANTOR HEREBY AGREES THAT ANY LEGAL ACTION OR
PROCEEDING AGAINST GUARANTOR WITH RESPECT TO THIS AGREEMENT OR ANY OTHER
AGREEMENTS OR DOCUMENTS CONTEMPLATED HEREBY OR REFERRED TO HEREIN MAY BE BROUGHT
IN THE COURTS OF THE STATE OF NEW YORK LOCATED IN NEW YORK CITY OR OF THE UNITED
STATES OF AMERICA

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FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT GUARANTOR ACCEPTS AND CONSENTS FOR ITSELF AND IN RESPECT TO ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS, and further consents (to the extent permitted by applicable law) to the
service of process in any such action or proceeding being made upon Guarantor by
mail at the address stated alongside its name on the signature page hereof or at
such other address as Lender is notified of in accordance with Section 18
hereof. Guarantor agrees that Sections 5-1401 and 5-1402 of the General
Obligations Law of the State of New York shall apply to this Agreement.
Guarantor waives any right to stay or to dismiss any action or proceeding
brought before any of said courts on the basis of forum non conveniens. Nothing
herein shall limit the right of Lender to bring proceedings against Guarantor in
the courts of any other jurisdiction.
     24. WAIVER OF JURY TRIAL. EACH OF LENDER AND GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT RELATED
HERETO, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL
OR WRITTEN), OR ACTIONS OF LENDER, GUARANTOR, THE BORROWER OR ANY AFFILIATE OF
ANY THEREOF. THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER TO ENTER INTO
THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS.
     25. FINAL AGREEMENT. BY SIGNING THIS DOCUMENT EACH PARTY REPRESENTS AND
AGREES THAT: (A) THIS DOCUMENT REPRESENTS THE FINAL AGREEMENT BETWEEN PARTIES
WITH RESPECT TO THE SUBJECT MATTER HEREOF, (B) THIS DOCUMENT SUPERSEDES ANY
COMMITMENT LETTER, TERM SHEET, OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS
RELATING TO THE SUBJECT MATTER HEREOF, UNLESS SUCH COMMITMENT LETTER, TERM
SHEET, OR OTHER WRITTEN OUTLINE OF TERMS AND CONDITIONS EXPRESSLY PROVIDES TO
THE CONTRARY, (C) THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES,
AND (D) THIS DOCUMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR UNDERSTANDINGS OF THE PARTIES.

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     The parties executed this agreement as of August ___, 2007, intending to
create an instrument executed under seal.

                  Attested to:       FRANKLIN CREDIT MANAGEMENT CORPORATION    
 
               
 
      BY:        
 
               
Name:
          Name    
 
          Title:    
 
                Address for notices to Lender:
c/o Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Attn: Christine Renard, Senior Vice President       Address for notices:
101 Hudson Street, 25th Floor
Jersey City, NJ 07302
Attn: General Counsel    

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