Exhibit 10.9

COMMERCIAL GUARANTY

 

Principal

  Loan Date   Maturity   Loan No   Call / Coll   Account   Officer   Initials  
      5715     ***  

References in the boxes above are for Lender’s use only and do not limit the
applicability of this document to any particular loan or item. Any item above
containing “***” has been omitted due to text length limitations.

 

Borrower:   

EACO CORPORATION, a Florida Corporation

304 EVENING STAR LANE

NEWPORT BEACH, CA 92660

  Lender:   

ZIONS FIRST NATIONAL BANK

NATIONAL REAL ESTATE DEPARTMENT

ONE SOUTH MAIN STREET, SUITE 1400

SALT LAKE CITY, UT 84111

Guarantor:   

GLEN CEILEY

304 EVENING STAR LANE

NEWPORT BEACH, CA 92660

    

 

 

 

GUARANTEE OF PAYMENT AND PERFORMANCE. For good and valuable consideration,
Guarantor absolutely and unconditionally guarantees full and punctual payment
and satisfaction of the Indebtedness of Borrower to Lender, and the performance
and discharge of all Borrower’s obligations under the Note and the Related
Documents. This is a guaranty of payment and performance and not of collection,
so Lender can enforce this Guaranty against Guarantor even when Lender has not
exhausted Lender’s remedies against anyone else obligated to pay the
Indebtedness or against any collateral securing the Indebtedness, this Guaranty
or any other guaranty of the Indebtedness. Guarantor will make any payments to
Lender or its order, on demand, in legal tender of the United States of America,
in same-day funds, without set-off or deduction or counterclaim, and will
otherwise perform Borrower’s obligations under the Note and Related Documents.

INDEBTEDNESS. The word “Indebtedness” as used in this Guaranty means all of the
principal amount outstanding from time to time and at any one or more times,
accrued unpaid interest thereon and all collection costs and legal expenses
related thereto permitted by law, reasonable attorneys’ fees, arising from any
and all debts, liabilities and obligations that Borrower individually or
collectively or interchangeably with others, owes or will owe Lender under the
Note and Related Documents and any renewals, extensions, modifications,
refinancings, consolidations and substitutions of the Note and Related
Documents.

If Lender presently holds one or more guaranties, or hereafter receives
additional guaranties from Guarantor, Lender’s rights under all guaranties shall
be cumulative. This Guaranty shall not (unless specifically provided below to
the contrary) affect or invalidate any such other guaranties. Guarantor’s
liability will be Guarantor’s aggregate liability under the terms of this
Guaranty and any such other unterminated guaranties.

DURATION OF GUARANTY. This Guaranty will take effect when received by Lender
without the necessity of any acceptance by Lender, or any notice to Guarantor or
to Borrower, and will continue in full force until all the Indebtedness shall
have been fully and finally paid and satisfied and all of Guarantor’s other
obligations under this Guaranty shall have been performed in full. Release of
any other guarantor or termination of any other guaranty of the Indebtedness
shall not affect the liability of Guarantor under this Guaranty. A revocation
Lender receives from any one or more Guarantors shall not affect the liability
of any remaining Guarantors under this Guaranty.

GUARANTOR’S AUTHORIZATION TO LENDER. Guarantor authorizes Lender without notice
or demand and without lessening Guarantor’s liability under this Guaranty, from
time to time: (A) to make one or more additional secured or unsecured loans to
Borrower, to lease equipment or other goods to Borrower, or otherwise to extend
additional credit to Borrower; (B) to alter, compromise, renew, extend,
accelerate, or otherwise change one or more times the time for payment or other
terms of the Indebtedness or any part of the Indebtedness, including increases
and decreases of the rate of interest on the Indebtedness; extensions may be
repeated and may be for longer than the original loan term; (C) to take and hold
security for the payment of this Guaranty or the Indebtedness, and exchange,
enforce, waive, subordinate, fail or decide not to perfect, and release any such
security, with or without the substitution of new collateral; (D) to release,
substitute, agree not to sue, or deal with any one or more of Borrower’s
sureties, endorsers, or other guarantors on any terms or in any manner Lender
may choose; (E) to determine how, when and what application of payments and
credits shall be made on the Indebtedness; (F) to apply such security and direct
the order or manner of sale thereof, including without limitation, any
nonjudicial sale permitted by the terms of the controlling security agreement or
deed of trust, as Lender in its discretion may determine; (G) to sell, transfer,
assign or grant participations in all or any part of the Indebtedness; and
(H) to assign or transfer this Guaranty in whole or in part.

GUARANTOR’S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to
Lender that (A) no representations or agreements of any kind have been made to
Guarantor which would limit or qualify in any way the terms of this Guaranty;
(B) this Guaranty is executed at Borrower’s request and not at the request of
Lenders; (C) Guarantor has full power, right and authority to enter into this
Guaranty; (D) the provisions of this Guaranty do not conflict with or result in
a default under any agreement or other instrument binding upon Guarantor and do
not result in a violation of any law, regulation, court decree or order
applicable to Guarantor; (E) Guarantor has not and will not, without the prior
written consent of Lender, sell, lease, assign, encumber, hyphotecate, transfer,
or otherwise dispose of all or substantially all of Guarantor’s assets, or any
interest therein; (F) upon Lender’s request, Guarantor will provide to Lender
financial and credit information in form acceptable to Lender, and all such
financial information which currently has been, and all future financial
information which will be provided to Lender is and will be true and correct in
all material respects and fairly present Guarantor’s financial condition as of
the dates the financial information is provided; (G) no material adverse change
has occurred in Guarantor’s financial condition since the date of the most
recent financial statements provided to Lender and no event has occurred which
may materially adversely affect Guarantor’s financial condition; (H) no
litigation, claim, investigation, administrative proceeding or similar action
(including those for unpaid taxes) against Guarantor is pending or threatened;
(I) Lender has made no representation to Guarantor as to the creditworthiness of
Borrower; and (J) Guarantor has established adequate means of obtaining from
Borrower on a continuing basis information regarding Borrower’s financial
condition. Guarantor agrees to keep adequately informed from such means of any
facts, events, or circumstances which might in any way affect Guarantor’s risks
under this Guaranty, and Guarantor further agrees that, absent a request for
information, Lender shall have no obligation to disclose to Guarantor any
information or documents acquired by Lender in the course of its relationship
with Borrower.

GUARANTOR’S WAIVERS. Except as prohibited by applicable law, Guarantor waives
any right to require Lender (A) to continue lending money or to extend other
credit to Borrower; (B) to make any presentment, protest, demand, or notice of
any kind, including notice of any nonpayment of the Indebtedness or of any
nonpayment related to any collateral, or notice of any action or nonaction on
the part of Borrower, Lender, any surety, endorser, or other guarantor in
connection with the Indebtedness or in connection with the creation of new or
additional loans or obligations; (C) to resort for payment or to proceed
directly or at once against any person, including Borrower or any other
guarantor; (D) to proceed directly against or exhaust any collateral held by
Lender from Borrower, any other guarantor, or any other person; (E) to give
notice of the terms, time, and place of any public or private sale of personal
property security held by Lender from Borrower or to comply with any other
applicable provisions of the Uniform Commercial Code; (F) to pursue any other
remedy within Lender’s power; or (G) to commit any act or omission of any kind,
or at any time, with respect to any matter whatsoever.

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Guarantor also waives any and all rights or defenses based on suretyship or
impairment of collateral including, but not limited to, any rights or defenses
arising by reason of (1) any election of remedies by Lender which destroys or
otherwise adversely affects Guarantor’s subrogation rights or Guarantor’s rights
to proceed against Borrower for reimbursement including without limitation, any
loss of rights Guarantor may suffer by reason of any law limiting, qualifying,
or discharging the Indebtedness; (2) any disability or other defense of
Borrower, of any other guarantor, or of any other person, or by reason of the
cessation of Borrower’s liability from any cause whatsoever, other than payment
in full in legal tender, of the Indebtedness; (3) any right to claim discharge
of the Indebtedness on the basis of unjustified impairment of any Collateral for
the Indebtedness; or (4) any statute of limitations, if at any time any action
or suit brought by Lender against Guarantor is commenced, there is outstanding
Indebtedness which is not barred by any applicable statute of limitations.
Guarantor acknowledges and agrees that Guarantor’s obligations under this
Guaranty shall apply to and continue with respect to any amount paid to Lender
which is subsequently recovered from Lender for any reason whatsoever (including
without limitation as a result of bankruptcy, insolvency or fraudulent
conveyance proceeding), notwithstanding the fact that all or a part of the
Indebtedness may have been previously paid, or this Guaranty may have been
terminated, or both.

Guarantor also waives and agrees not to assert or take advantage of (1) any
right (including the right, if any, under Utah’s one-action rule as set forth in
Utah Code Annotated, 1953, Section 78-37-1) to require Lender to proceed against
or exhaust any security held by Lender at any time or to pursue any other remedy
in Lender’s power before proceeding against Guarantor; (2) the release or
surrender of any security held for the payments of the Indebtedness; or (3) any
defense based upon an election of remedies (including, if available, an election
of remedies to proceed by non-judicial foreclosure) by Lender which destroys or
otherwise impairs the subrogation rights of Guarantor or the right of Guarantor
to proceed against Borrower for reimbursement, or both.

Guarantor further waives and agrees not to assert or claim at any time any
deductions to the amount guaranteed under this Guaranty for any claim of setoff,
counterclaim, counter demand, recoupment or similar right, whether such claim,
demand or right may be asserted by the Borrower, the Guarantor, or both.

Guarantor’s Understanding With Respect To Waivers. Guarantor warrants and agrees
that each of the waivers set forth above is made with Guarantor’s full knowledge
of its significance and consequences and that, under the circumstances, the
waivers are reasonable and not contrary to public policy or law. If any such
waiver is determined to be contrary to any applicable law or public policy, such
waiver shall be effective only to the extent permitted by law or public policy.

Subordination of Borrower’s Debts to Guarantor. Guarantor agrees that the
Indebtedness, whether now existing or hereafter created, shall be superior to
any claim that Guarantor may now have or hereafter acquire against Borrower,
whether or not Borrower becomes insolvent. Guarantor hereby expressly
subordinates any claim Guarantor may have against Borrower, upon any account
whatsoever, to any claim that Lender may now or hereafter have against Borrower.
In the event of insolvency and consequent liquidation of the assets of Borrower,
through bankruptcy, by an assignment for the benefit of creditors, by voluntary
liquidation, or otherwise, the assets of Borrower applicable to the payment of
the claims of both Lender and Guarantor shall be paid to Lender and shall be
first applied by Lender to the Indebtedness. Guarantor does hereby assign to
Lender all claims which it may have or acquire against Borrower or against any
assignee or trustee in bankruptcy of Borrower; provided however, that such
assignment shall be effective only for the purpose of assuring to Lender full
payment in legal tender of the Indebtedness. If Lender so requests any notes or
credit agreements now or hereafter evidencing any debts or obligations of
Borrower to Guarantor shall be marked with a legend that the same are subject to
this Guaranty and shall be delivered to Lender. Guarantor agrees, and Lender is
hereby authorized, in the name of Guarantor, from time to time to file financing
statements and continuation statements and to execute documents and to take such
other actions as Lender deems necessary or appropriate to perfect, preserve and
enforce its rights under this Guaranty.

Miscellaneous Provisions. The following miscellaneous provisions are a part of
this Guaranty:

Amendments. This Guaranty, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this Guaranty. No alteration of or amendment to this Guaranty shall be effective
unless given in writing and signed by the party or parties sought to be charged
or bound by the alteration or amendment.

Arbitration Disclosures.

 

  1. ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY
LIMITED REVIEW BY A COURT.

 

  2. IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT,
INCLUDING THEIR RIGHT TO A JURY TRIAL.

 

  3. DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.

 

  4. ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING
IN THEIR AWARDS. THE RIGHT TO APPEAL OR SEEK MODIFICATION OF ARBITRATORS RULINGS
IS VERY LIMITED.

 

  5. A PANEL OF ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS AFFILIATED
WITH THE BANKING INDUSTRY.

 

  6. ARBITRATION WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES, NOT JUST THOSE
CONCERNING THE AGREEMENT.

 

  7. IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR THE
AMERICAN ARBITRATION ASSOCIATION.

(a) Any claim or controversy (“Dispute”) between or among the parties and their
employees, agents, affiliates, and assigns, including, but not limited to,
Disputes arising out of or relating to this agreement, this arbitration
provision (“arbitration clause”), or any related agreements or instruments
relating hereto or delivered in connection herewith (“Related Agreements”), and
including, but not limited to, a Dispute based on or arising from an alleged
tort, shall at the request of any party be resolved by binding arbitration in
accordance with the applicable arbitration rules of the American Arbitration
Association (the “Administrator”). The provisions of this arbitration clause
shall survive any termination, amendment or expiration of this agreement or
Related Agreements. The provisions of this arbitration clause shall supersede
any prior arbitration agreement between or among the parties.

(b) The arbitration proceedings shall be conducted in a city mutually agreed by
the parties. Absent such an agreement, arbitration will be conducted in Salt
Lake City, Utah or such other place as may be determined by the Administrator.
The Administrator and the arbitrator(s) shall have the authority to the extent
practicable to take any action to require the arbitration proceeding to be
completed and the arbitrator(s)’ award issued within 150 days of the filing of
the Dispute with the Administrator. The arbitrator(s) shall have the authority
to impose sanctions on any party that fails to comply with time periods imposed
by the Administrator or the arbitrator(s), including the sanction of summarily
dismissing any Dispute or defense with prejudice. The arbitrator(s) shall have
the authority to resolve any Dispute regarding the terms of this agreement, this
arbitration clause, or Related Agreements, including any claim or controversy
regarding the arbitrability of any Dispute. All limitations periods applicable
to any Dispute or defense, whether by statute or agreement, shall apply to any
arbitration proceeding hereunder and the arbitrator(s) shall have the authority
to decide whether any Dispute or defense is barred by a limitations period and,
if so to summarily enter an award dismissing any Dispute or defense on that
basis. The doctrines of compulsory counterclaim, res judicata, and collateral
estoppel shall apply to any arbitration proceeding hereunder so that a party
must state as a counterclaim in the arbitration proceeding any claim or
controversy which arises out of the transaction or occurrence that is the
subject matter of the Dispute. The arbitrator(s) may in the arbitrator(s)’
discretion and at the request of any party: (1) consolidate in a single

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arbitration proceeding any other claim arising out of the same transaction
involving another party to that transaction that is bound by an arbitration
clause with Lender, such as borrowers, guarantors, sureties, and owners of
collateral; and (2) consolidate or administer multiple arbitration claims or
controversies as a class action in accordance with Rule 23 of the Federal Rules
of Civil Procedure.

(c) The arbitrator(s) shall be selected in accordance with the rules of the
Administrator from panels maintained by the Administrator. A single arbitrator
shall have expertise in the subject matter of the Dispute. Where three
arbitrators conduct an arbitration proceeding, the Dispute shall be decided by a
majority vote of the three arbitrators, at least one of whom must have expertise
in the subject matter of the Dispute and at least one of whom must be a
practicing attorney. The arbitrator(s) shall award to the prevailing party
recovery of all costs and fees (including attorneys’ fees and costs, arbitration
administration fees and costs, and arbitrator(s)’ fees). The arbitrator(s),
either during the pendency of the arbitration proceeding or as part of the
arbitration award, also may grant provisional or ancillary remedies including
but not limited to an award of injunctive relief, foreclosure, sequestration,
attachment, replevin, garnishment, or the appointment of a receiver.

(d) Judgement upon an arbitration award may be entered in any court having
jurisdiction, subject to the following limitation: the arbitration award is
binding upon the parties only if the amount does not exceed Four Million Dollars
($4,000,000.00); if the award exceeds that limit, either party may demand the
right to a court trial. Such a demand must be filed with the Administrator
within thirty (30) days following the date of the arbitration award; if such a
demand is not made with that time period, the amount of the arbitration award
shall be binding. The computation of the total amount of an arbitration award
shall include amounts awarded for attorneys’ fees and costs, arbitration
administration fees and costs, and arbitrator(s)’ fees.

(e) No provision of this arbitration clause, nor the exercise of any rights
hereunder, shall limit the right of any party to: (1) judicially or
non-judicially foreclose against any real or personal property collateral or
other security; (2) exercise self-help remedies, including but not limited to
repossession and setoff rights; or (3) obtain from a court having jurisdiction
thereover any provisional or ancillary remedies including but not limited to
injunctive relief, foreclosure, sequestration, attachment, replevin,
garnishment, or the appointment of a receiver. Such rights can be exercised at
any time, before or after initiation of an arbitration proceeding, except to the
extent such action is contrary to the arbitration award. The exercise of such
rights shall not constitute a waiver of the right to submit any Dispute to
arbitration, and any claim or controversy related to the exercise of such rights
shall be a Dispute to be resolved under the provisions of this arbitration
clause. Any party may initiate arbitration with the Administrator. If any party
desires to arbitrate a Dispute asserted against such party in a complaint,
counterclaim, cross-claim, or third-party complaint thereto, or in an answer or
other reply to any such pleading, such party must make an appropriate motion to
the trial court seeking to compel arbitration, which motion must be filed with
the court within 45 days of service of the pleading, or amendment thereto,
setting forth such Dispute. If arbitration is compelled after commencement of
litigation of a Dispute, the party obtaining an order compelling arbitration
shall commence arbitration and pay the Administrator’s filing fees and costs
within 45 days of entry of such order. Failure to do so shall constitute an
agreement to proceed with litigation and waiver of the right to arbitrate. In
any arbitration commenced by a consumer regarding a consumer Dispute, Lender
shall pay one half of the Administrator’s filing fee, up to $250.

(f) Notwithstanding the applicability of any other law to this agreement, the
arbitration clause, or Related Agreements between or among the parties, the
Federal Arbitration Act, 9 U.S.C. Section 1 et seq., shall apply to the
construction and interpretation of this arbitration clause. If any provision of
this arbitration clause should be determined to be unenforceable, all other
provisions of this arbitration clause shall remain in full force and effect.

Attorneys’ Fees; Expenses. Guarantor agrees to pay upon demand all of Lender’s
costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s
legal expenses, incurred in connection with the enforcement of this Guaranty.
Lender may hire or pay someone else to help enforce this Guaranty, and Guarantor
shall pay the costs and expenses of such enforcement. Costs and expenses include
Lender’s reasonable attorneys’ fees and legal expenses whether or not Lender’s
salaried employee and whether or not there is a lawsuit, including reasonable
attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts
to modify or vacate any automatic stay or injunction), appeals, and any
anticipated post-judgment collection services. Guarantor also shall pay all
court costs and such additional fees as may be directed by the court.

Caption Headings. Caption headings in this Guaranty are for convenience purposes
only and are not to be used to interpret or define the provisions of this
Guaranty.

Governing Law. This Guaranty will be governed by federal law applicable to
Lender and, to the extent not preempted by federal law, the laws of the State of
Utah without regard to its conflicts of law provisions.

Choice of Venue. If there is a lawsuit, Guarantor agrees upon Lender’s request
to submit to the jurisdiction of the courts of SALT LAKE County, State of Utah.

Integration. Guarantor further agrees that Guarantor has read and fully
understands the terms of this Guaranty; Guarantor has had the opportunity to be
advised by Guarantor’s attorney with respect to this Guaranty; the Guaranty
fully reflects Guarantor’s intentions and parol evidence is not required to
interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds
Lender harmless from all losses, claims, damages, and costs (including Lender’s
attorneys’ fees) suffered or incurred by Lender as a result of any breach by
Guarantor of the warranties, representations and agreements of this paragraph.

Interpretation. In all cases where there is more than one Borrower or Guarantor,
then all words used in this Guaranty in the singular shall be deemed to have
been used in the plural where the context and construction so require; and where
there is more than one Borrower named in this Guaranty or when this Guaranty is
executed by more than one Guarantor, the words “Borrower” and “Guarantor”
respectively shall mean all and any one or more of them. The words “Guarantor,”
“Borrower,” and “Lender” include the heirs, successors, assigns, and transferees
of each of them. If a court finds that any provision of this Guaranty is not
valid or should not be enforced, that fact by itself will not mean that the rest
of this Guaranty will not be valid or enforced. Therefore, a court will enforce
the rest of the provisions of this Guaranty even if a provision of this Guaranty
may be found to be invalid or unenforceable. If any one or more of Borrower or
Guarantor are corporations, partnerships, limited liability companies, or
similar entities, it is not necessary for Lender to inquire into the powers of
Borrower or Guarantor or of the officers, directors, partners, managers, or
other agents acting or purporting to act on their behalf, and any indebtedness
made or created in reliance upon the professed exercise of such powers shall be
guaranteed under this Guaranty.

Notices. Unless otherwise provided by applicable law, any notice required to be
given under this Guaranty or required by law shall be given in writing, and
shall be effective when actually delivered in accordance with the law or with
this Guaranty, when actually received by telefacsimile (unless otherwise
required by law), when deposited with a nationally recognized overnight courier,
or, if mailed, when deposited in the United States mail, as first class,
certified or registered mail postage prepaid, directed to the addresses shown
near the beginning of this Guaranty. Any party may change its address for
notices under this Guaranty by giving formal written notice to the other
parties, specifying that the purpose of the notice is to change the party’s
address. For notice purposes, Guarantor agrees to keep Lender informed at all
times of Guarantor’s current address. Unless otherwise provided by applicable
law, if there is more than one Guarantor, any notice given by Lender to any
Guarantor is deemed to be notice given to all Guarantors.

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No Waiver by Lender. Lender shall not be deemed to have waived any rights under
this Guaranty unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Lender of a provision of
this Guaranty shall not prejudice or constitute a waiver of Lender’s right
otherwise to demand strict compliance with that provision or any other provision
of this Guaranty. No prior waiver by Lender, nor any course of dealing between
Lender and Guarantor, shall constitute a waiver of any of Lender’s rights or of
any of Guarantor’s obligations as to any future transactions. Whenever the
consent of Lender is required under this Guaranty, the granting of such consent
by Lender in any instance shall not constitute continuing consent to subsequent
instances where such consent is required and in all cases such consent may be
granted or withheld in the sole discretion of Lender.

Successors and Assigns. Subject to any limitations stated, in this Guaranty on
transfer of Guarantor’s interest, this Guaranty shall be binding upon and inure
to the benefit of the parties, their successors and assigns.

FINANCIAL STATEMENT. GUARANTOR COVENANTS AND AGREES WITH LENDER THAT, WHILE THIS
AGREEMENT IS IN EFFECT, GUARANTOR WILL FURNISH LENDER WITH, UPON REQUEST,
GUARANTOR’S PERSONAL FINANCIAL STATEMENT.

TAX RETURNS. BORROWER AND GUARANTOR SHALL PROVIDE TO LENDER, UPON REQUEST, A
COPY OF BORROWER’S AND GUARANTOR’S FEDERAL TAX RETURN.

FAILURE TO PROVIDE ACCEPTABLE FINANCIAL STATEMENTS AS REQUIRED. FURNISHING
FINANCIAL INFORMATION: DURING THE TERM OF THE NOTE AND ANY EXTENSIONS OR
RENEWALS THEREOF, BORROWER/GUARANTOR SHALL FURNISH AN ANNUAL FINANCIAL STATEMENT
PREPARED IN A FORM ACCEPTABLE TO THE BANK, AS SOON AS PRACTICABLE BUT NO LATER
THAN 120 DAYS AFTER BORROWER/GUARANTOR’S YEAR END AND SUCH INTERIM FINANCIAL
STATEMENTS AND ALL OTHER INFORMATION AND MATERIAL AS BANK MAY FROM TIME TO TIME
REQUEST. IF AN EVENT OF DEFAULT (AS DEFINED BELOW AND IN THE NOTE) SHALL HAVE
OCCURED AND BY CONTINUING FOR WHICH THE BANK DOES NOT ACCELERATE THE
INDEBTEDNESS EVIDENCED BY THE NOTE, WHICH EVENT OF DEFAULT CONSISTS OF THE
FAILURE OF BORROWER/GUARANTOR TO PROVIDE FINANCIAL STATEMENTS AND OTHER
INFORMATION AS REQUIRED BY THE TERMS OF THIS AGREEMENT, THE INTEREST RATE
APPLICABLE TO THE NOTE, FOR A PERIOD BEGINNING THREE (3) DAYS AFTER WRITTEN
NOTICE OF SUCH EVENT, OF DEFAULT IS GIVEN AND ENDING UPON THE CURING OF SUCH
DEFAULT, SHALL AT BANK’S OPTION, BE INCREASED BY ONE QUARTER OF ONE PERCENT
(.25%) FOR THE FIRST 30-DAYS OF SAID EVENT OF DEFAULT AND BY AN ADDITIONAL ONE
QUARTER OF ONE PERCENT (.25%) DURING EACH 30-DAY PERIOD THEREAFTER DURING WHICH
SUCH EVENT OF DEFAULT CONTINUES. SUCH RATES SHALL APPLY TO THE ENTIRE
OUTSTANDING PRINCIPAL BALANCE OF THE NOTE. UPON CURING SUCH EVENT OF DEFAULT,
THE INTEREST RATE ON THE NOTE SHALL REVERT TO THE APPLICABLE RATE THEREUNDER
EFFECTIVE AS OF THE DATE ON WHICH SAID EVENT OF DEFAULT IS CURED. BORROWER
ACKNOWLEDGES THAT SUCH INCREASE INTEREST RATE IS INTENDED TO COMPENSATE BANK FOR
THE POTENTIALLY HIGHER CREDIT RISK AND INCREASED ADMINISTRATIVE COSTS ASSOCIATED
WITH BORROWER/GUARANTOR’S FAILURE TO FURNISH TIMELY FINANCIAL INFORMATION.

Definitions. The following capitalized words and terms shall have the following
meanings when used in this Guaranty. Unless specifically stated to the contrary,
all references to dollar amounts shall mean amounts in lawful money of the
United States of America. Words and terms used in the singular shall include the
plural, and the plural shall include the singular, as the context may require.
Words and terms not otherwise defined in this Guaranty shall have the meanings
attributed to such terms in the Uniform Commercial Code:

Borrower. The word “Borrower” means EACO CORPORATION, a Florida Corporation and
includes all co-signers and co-makers signing the Note and all their successors
and assigns.

Guarantor. The word “Guarantor” means everyone signing this Guaranty, including
without limitation GLEN CEILEY, and in each case, any signer’s successors and
assigns.

Guaranty. The word “Guaranty” means this guaranty from Guarantor to Lender.

Indebtedness. The word “Indebtedness” means Borrower’s indebtedness to Lender as
more particularly described in this Guaranty.

Lender. The word “Lender” means ZIONS FIRST NATIONAL BANK, its successors and
assigns.

Note. The word “Note” means the promissory note dated March 28. 2008, in the
original principal amount of $1,216,354.00 from Borrower to Lender, together
with all renewals of, extensions of, modifications of, refinancings of,
consolidations of, and substitutions for the promissory note or agreement.

Related Documents. The words “Related Documents” mean all promissory notes,
credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral
mortgages, and all other instruments, agreements and documents, whether now or
hereafter existing, executed in connection with the Indebtedness.

EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR’S EXECUTION AND DELIVERY OF THIS
GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE
MANNER SET FORTH IN THE SECTION TITLED “DURATION OF GUARANTY”. NO FORMAL
ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY
IS DATED MARCH 28, 2008.

 

GUARANTOR: X  

/s/ Glen Ceiley

  GLEN CEILEY