Exhibit 10.2
[Execution Copy]
GUARANTY AGREEMENT
     This GUARANTY AGREEMENT (this “Agreement”) made as of August 26, 2005 by
each of FIRSTCITY FINANCIAL CORPORATION, a Delaware corporation, FIRSTCITY
COMMERCIAL CORPORATION, a Texas corporation, FIRSTCITY EUROPE CORPORATION, a
Texas corporation, FIRSTCITY HOLDINGS CORPORATION, a Texas corporation,
FIRSTCITY INTERNATIONAL CORPORATION, a Texas corporation, FIRSTCITY MEXICO,
INC., a Texas corporation, and FIRSTCITY SERVICING CORPORATION, a Texas
corporation (each such entity, and any other Person which becomes a Guarantor
pursuant to Section 25 hereof, a “Guarantor”, and collectively, the
“Guarantors”), in favor of BANK OF SCOTLAND, a federal branch under applicable
United States banking law of a Scottish banking institution, as agent (in such
capacity, and including its successors and assigns in such capacity, the
“Agent”) for the lenders (the “Lenders”) from time to time party to the
Revolving Credit Agreement referred to below.
W I T N E S S E T H
     WHEREAS, FH Partners, L.P., a Texas limited partnership (the “Borrower”),
the Lenders and the Agent are party to the Revolving Credit Agreement, dated as
of August 26, 2005 (as amended, modified or supplemented from time to time, the
“Revolving Credit Agreement”) (each capitalized term used but not defined herein
shall have the meaning specified therefore in the Revolving Credit Agreement);
     WHEREAS, each Guarantor will derive substantial direct and indirect benefit
from the Loans made to the Borrower pursuant to the Revolving Credit Agreement;
and
     WHEREAS, it is a condition precedent to the Lenders entering into the
Revolving Credit Agreement and making extensions of credit thereunder that each
Guarantor guaranty all obligations of the Borrower under and in respect of the
Revolving Credit Agreement and the Loan Documents.
     NOW, THEREFORE, in consideration of the premises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, each Guarantor hereby agrees as follows:
     1. The Guaranty. (a) Each Guarantor hereby unconditionally and irrevocably
guarantees to the Lenders, on a joint and several basis, the prompt and complete
payment when due of any and all of the present and future indebtedness and
obligations (mature or contingent) of the Borrower to the Lenders, whether
direct or indirect, absolute or contingent, due or to become due, secured or
unsecured, now existing or hereafter arising or acquired (whether by way of
discount, letter of credit, lease, loan, overdraft or otherwise and including
without limitation all indebtedness and obligations arising under or pursuant to
the Loan Documents, including, without limitation, all interest which may be
payable on such indebtedness and obligations prior to or during the pending of
any insolvency or similar proceeding with respect to the Borrower.

 

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All such indebtedness and obligations are referred to in this Agreement as the
“Indebtedness” and will be payable by such Guarantor to the Agent, on behalf of
the Lenders, at its office set opposite its name on the signature page hereof,
or at such other payment office as the Agent may notify such Guarantor of in
writing, with respect to all Indebtedness, immediately on demand in the event of
any default of the Borrower with respect to such Indebtedness or any part
thereof, without setoff or counterclaim. If any Lender is prevented by law from
accelerating any of the Indebtedness in accordance with the terms of any
agreement or instrument governing the same the Agent shall be entitled to
receive hereunder from such Guarantor, upon demand therefor, the sum which would
have otherwise been due had such acceleration occurred.
          (b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder (said maximum
liability, its “Maximum Guaranteed Amount”) shall in no event exceed such amount
which can be guaranteed by such Guarantor under applicable federal and state
laws relating to the insolvency of debtors.
          (c) The Guarantors hereby agree, as among themselves, that the
ultimate responsibility for payment of the Obligations of the Borrower shall be
equitably apportioned among the Guarantors in the proportion that each Guarantor
has benefited from the making by the Lenders of the Loans under the Revolving
Credit Agreement or, with respect to any Guarantor, if greater, in proportion to
the respective net worth of that Guarantor relative to all other Guarantors
(such net worth amounts determined in a manner such that none of the obligations
of any Guarantor hereunder would be subject to avoidance as a fraudulent
transfer or conveyance under Section 548 of Title 11 of the United States Code
or any comparable provisions of applicable state law). If any Guarantor (an
“Overpaying Guarantor”) shall pay an amount (including any amounts of recoveries
against any property of such Guarantor under any Security Document) with respect
to the Obligations of the Borrower in excess of its proportionate share,
determined as set forth in this subsection (c), each other Guarantor shall make
a payment to such Overpaying Guarantor in an amount such that the aggregate
amount of each Guarantor’s payments hereunder (together any amounts of
recoveries against the property of such Guarantor under any Security Document)
reflects its proportionate share of the Borrower’s Obligations, as so
determined. The foregoing agreement is intended to set forth only the rights and
obligations of the Guarantors among themselves and shall in no way affect the
obligations of any Guarantor to the Agent or any Lender hereunder (including,
without limitation, the joint and several nature of such obligations) or under
any other Loan Document. Until the Indebtedness has been indefeasibly paid in
full (except for contingent indemnification and expense reimbursement
obligations for which a claim has not yet been made) and all Commitments shall
have terminated, each Guarantor shall withhold exercise of any right of
contribution hereunder against any other Guarantor.
          (d) Each Guarantor agrees that the Indebtedness may at any time and
from time to time exceed the Maximum Guaranteed Amount without impairing this
Agreement or affecting the rights and remedies of the Agent and the Lenders
hereunder.
          (e) No payment or payments made by the Borrower, any other guarantor
or any other Person or received or collected by the Agent or any Lender from the
Borrower, any other guarantor or any other Person by virtue of any action or
proceeding or any set-off or

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appropriation or application at any time or from time in reduction of or in
payment of the Indebtedness shall be deemed to modify, reduce, release or
otherwise affect the liability of any Guarantor hereunder which shall,
notwithstanding any such payment or payments other than payments made to the
Agent by such Guarantor or payments received or collected by the Agent from such
Guarantor, remain liable for the Indebtedness up to its Maximum Guaranteed
Amount until the Indebtedness is indefeasibly paid in full.
     2. Bankruptcy. Additionally, each Guarantor unconditionally and irrevocably
guarantees the payment of any and all Obligations of the Borrower, whether or
not due or payable, upon the occurrence in respect of the Borrower of any of the
events specified in Section 9 of the Revolving Credit Agreement (including,
without limitation, Section 9.7 thereof) and unconditionally promises to pay
such Indebtedness to the Agent on behalf of the Lenders, or order, on demand, in
lawful money of the United States, without setoff or counterclaim.
     3. Independent Obligation. (a) The obligations of each Guarantor hereunder
are independent of the obligations of each other Guarantor and of any other
guarantor or the Borrower, and any security for or other guarantee of the
Indebtedness of the Borrower, and a separate action or actions may be brought
and prosecuted against each Guarantor whether or not action is brought against
any Guarantor hereunder or any other guarantor or the Borrower or any security
held by the Agent and without pursuing any other remedy, and whether or not any
other guarantor or the Borrower be joined in any such action or actions. Each
Guarantor waives, independently and separately, to the fullest extent permitted
by law, the benefit of any statute of limitations affecting its liability
hereunder or the enforcement thereof. Any payment by the Borrower or other
circumstance which operates to toll any statute of limitations as to the
Borrower shall operate to toll the statute of limitations as to each Guarantor.
The Agent’s and Lenders’ rights under this Agreement will not be exhausted by
any action or inaction by the Agent or the Lenders until all of the Indebtedness
has been indefeasibly paid in full.
          (b) The liability of each Guarantor hereunder is not affected or
impaired by any direction or application of payment by the Borrower or by any
other party, or by any other guarantee or undertaking of any other guarantor or
any other party as to the Indebtedness of the Borrower, by any payment on, or in
reduction of, any such other guarantee or undertaking, by the termination,
revocation or release of any obligations under the Revolving Credit Agreement or
of any other guarantor, by the dissolution or termination of the Borrower, or by
any payment made to the Agent or the Lenders on the Indebtedness which the Agent
or the Lenders repay to the Borrower or any other guarantor or other Person,
whether pursuant to court order, in any bankruptcy, reorganization, arrangement,
moratorium or other debtor relief proceeding or any other fact or circumstance
which would otherwise excuse the obligation of a guarantor or surety, and each
Guarantor, independently and separately, waives any right to the deferral or
modification of such Guarantor’s obligations hereunder by reason of any such
proceeding, fact or circumstance. This Agreement shall continue to be effective
in accordance with its terms, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of or with respect to any of the Indebtedness
is rescinded or must otherwise be restored or returned by the Agent or a Lender
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any other payor thereof, or upon or as a result of the
appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, the Borrower or any other payor

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thereof or any substantial part of its property, or otherwise, all as though
such payments had not been made.
     4. Authorization. Each Guarantor authorizes the Agent and the Lenders
without notice or demand, and without affecting or impairing the Guarantor’s
liability hereunder, from time to time to (a) renew, compromise, extend,
increase, accelerate or otherwise change the time for payment of, or otherwise
change the terms of, the Obligations of the Borrower or any part thereof,
including any increase or decrease of the rate of interest thereon, (b) take and
hold security from the Borrower, any guarantor or any other party for the
payment of this guaranty or the Indebtedness and subordinate, compromise,
exchange, enforce, waive and release any such security or accept additional or
substituted security, (c) apply such security and direct the order or manner of
sale thereof as the Agent in its discretion may determine, and (d) release, add
or substitute any one or more endorsers, guarantors or other obligors. Any
modifications, renewals and extensions of the Indebtedness may be made at any
time by the Agent or the Lenders, before or after any termination of the
Revolving Credit Agreement, and each Guarantor shall be fully liable, jointly
and severally, for any such modifications, renewals or extensions.
     5. Reliance. It is not necessary for the Lenders or the Agent to inquire
into the capacity or powers of the Borrower or the officers, directors, partners
or agents acting or purporting to act on its behalf, and any indebtedness made
or created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder. Each Guarantor assumes full responsibility for keeping
fully informed of the financial condition of the Borrower and all other
circumstances affecting the Borrower’s ability to perform its obligations to the
Agent and the Lenders, and agrees that neither the Agent nor any Lender will
have any duty to report to any Guarantor any information which the Agent or any
Lender receives about the Borrower’s financial condition or any circumstances
bearing on its ability to perform, and expressly waives any right to receive
such information and any defense based upon failure to receive such information.
     6. Subordination. Any indebtedness of the Borrower now or hereafter held by
any Guarantor, whether in connection with this Agreement or whether completely
independent of this Agreement and the indebtedness, is hereby subordinated to
the Indebtedness of the Borrower to the Lenders; and such indebtedness of the
Borrower to any Guarantor shall be collected, enforced and received by such
Guarantor as trustee for the Lenders and be paid over to the Lenders on account
of the Indebtedness of the Borrower to the Lenders, but without affecting or
impairing in any manner the liability of the Guarantor under the other
provisions of this Agreement. Each Guarantor further agrees that it will not
assert any claim against the Borrower until all Indebtedness has been completely
satisfied. Prior to the transfer by any Guarantor of any note or negotiable
instrument evidencing any indebtedness of the Borrower to such Guarantor, such
Guarantor shall mark such note or negotiable instrument with a legend that the
same is subject to this subordination.
     7. Waivers of Defenses. Each Guarantor, independently and separately,
waives: (a) all statutes of limitation as to the Indebtedness, this Agreement or
otherwise as a defense to any action brought against such Guarantor by the Agent
or any Lender, to the fullest extent permitted by law; (b) any defense based
upon any legal disability of the Borrower or any discharge or limitation of the
liability of the Borrower to the Agent or the Lenders, whether consensual or

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arising by operation of law or any bankruptcy, insolvency, or debtor-relief
proceeding, or from any other cause; (c) presentment, demand, protest and notice
of any kind; (d) any defense based upon or arising out of any defense which the
Borrower may have to the payment or performance of any part of the Indebtedness;
(e) any defense based upon any disbursements by the Agent or the Lenders to the
Borrower pursuant to any agreements or instruments governing the Indebtedness
whether same be deemed an additional advance or be deemed to be paid out of any
special interest or other fund accounts, as constituting unauthorized payments
hereunder or amounts not guaranteed by this Agreement; (f) all rights to
participate in any security held by the Agent or the Lenders for the
Indebtedness; (g) irregularity or unenforceability of any agreement or
instrument representing or governing the Indebtedness; (h) any request that the
Agent or a Lender be diligent or prompt in making demands hereunder or under any
agreement or instrument representing or governing the Indebtedness; and (i) any
other defense in law or equity (except the defense that the Indebtedness has
been indefeasibly paid in full) which, under applicable law, would release the
obligation of a guarantor or surety, until the Indebtedness has been
indefeasibly paid in full.
     8. Representations and Warranties. Each Guarantor represents, warrants and
agrees (which representations, warranties and agreements shall survive such
Guarantor’s execution of this Agreement) that this Agreement is in proper legal
form under the laws of such Guarantor’s jurisdiction of incorporation and
principal location for enforcement thereof against Guarantor in the courts of
any such jurisdiction. In any legal action upon this Agreement in any such
jurisdiction, the choice of law set forth in Section 15 hereof would be given
effect by the courts of such jurisdiction.
     9. Waiver of Subrogation; Certain Covenants of Guarantors.
          (a) Each Guarantor hereby irrevocably waives (but only until the final
indefeasible payment and satisfaction of all Obligations due to the Agent and
the Lenders) any claim or other rights which it may now have or hereafter
acquire against the Borrower or any other guarantor that arise from the
existence, payment, performance or enforcement of such Guarantor’s obligations
under this Agreement or any other Loan Document, including (without limitation)
any right of subrogation, reimbursement, exoneration, contribution,
indemnification, any right to participate in any claim or remedy of the Lenders
and the Agent against the Borrower or any other guarantor or any collateral
which the Agent or any Lender now has or hereafter acquires, whether or not such
claim, remedy or right arises in equity, or under contract, statute or common
law including (without limitation) the right to take or receive from the
Borrower, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security on account of such claim or other rights.
If any amount shall be paid to any Guarantor in violation of the preceding
sentence and the Obligations shall not have been paid in full and the
Commitments terminated, such amount shall be deemed to have been paid to such
Guarantor for the benefit of, and held in trust for the benefit of, the Lenders
and the Agent and shall forthwith be paid to the Agent on behalf of the Lenders
to be credited and applied upon the Obligations, whether matured or unmatured,
in accordance with the terms of the Revolving Credit Agreement. Each Guarantor
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by the Revolving Credit Agreement and that
the waiver set forth in this Agreement is knowingly made in contemplation of
such benefits.

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          (b) Each Guarantor hereby agrees to comply with each covenant and
other agreement set forth in the Revolving Credit Agreement which relates to
such Guarantor. Without limiting the generality of the foregoing, for these
purposes a covenant or agreement in the Revolving Credit Agreement will be
deemed to relate to a Guarantor if such covenant or agreement refers in any way
to a “Guarantor”, a “guarantor”, or refers specifically to such Guarantor. In
furtherance and not in limitation of the foregoing, a covenant or agreement set
forth in the Revolving Credit Agreement shall be deemed to relate to a Guarantor
if such covenant or agreement states that a Guarantor, guarantor, or Loan Party
will take an action or observe a duty or cause a condition or event to exist or
will not take an action or permit an event or condition to exist and whether
such covenant or agreement is formulated as a direct obligation of a Guarantor,
guarantor, or Loan Party or as an obligation of the Borrower to cause any such
Person to take an action or observe a duty or to ensure that an action is taken
by any such Person or to cause a condition or event to exist with respect to any
such Person or to ensure that the same exists with respect to any Person or to
cause or ensure that a specified action is not taken by such a Person or a
condition or event does not exist with respect to any such Person.
     10. Default. The Agent may declare any Guarantor in default under this
Agreement, and may exercise all of its rights hereunder and demand payment of
the aggregate outstanding principal amount of all Indebtedness, if such
Guarantor fails to perform any of its obligations under this Agreement or if the
Guarantor becomes the subject of any bankruptcy, insolvency, arrangement,
reorganization, moratorium, or other debtor-relief proceeding under any law,
whether now existing or hereafter enacted, or upon the appointment of a receiver
for, or the attachment, restraint of or making or levying of any order of court
or legal process affecting, the property of such Guarantor.
     11. Right of Setoff. In addition to all rights of setoff or lien against
any moneys, securities or other property of any Guarantor given to the Agent or
any Lender by law, upon the occurrence of any default under any agreement or
instrument governing any of the Indebtedness or under this Agreement, the Agent
and each Lender is authorized at any time and from time to time following an
Event of Default, without notice to any Guarantor or to any other Person, any
such notice being hereby expressly waived, independently and separately, by each
Guarantor, to set-off and apply any and all deposits (general) and any other
indebtedness at any time held or owing by the Agent or any Lender to or for the
credit or the account of such Guarantor against and on account of the
obligations of such Guarantor under this Agreement, irrespective of whether or
not the Agent or such Lender shall have made any demand hereunder or any demand
for payment of any Indebtedness and although said obligations, liabilities or
claims, or any of them, shall be contingent or unmatured.
     12. Costs and Expenses. In addition to the amounts guaranteed hereunder,
each Guarantor agrees to pay the Agent’s and the Lenders’ reasonable
out-of-pocket costs and expenses, including but not limited to legal fees and
disbursements, incurred in any effort to collect or enforce any of the
Indebtedness or this Agreement, whether or not any lawsuit is filed. Until paid
to the Agent or the Lenders, such sums will bear interest at the Past-Due Rate;
provided that if such interest exceeds the maximum amount permitted to be paid
under applicable law, then such interest shall be reduced to such maximum
permitted amount. Interest accrued hereunder pursuant to this paragraph shall be
payable on demand and shall be calculated on the basis of the actual number of
days elapsed and a 360-day year.

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     13. Cumulative Remedies. No delay or failure by the Agent or any Lender to
exercise any right or remedy against, or to require performance by, the Borrower
or any Guarantor or any other Person shall be construed as a waiver of that
right, remedy or requirement. All remedies of the Agent and the Lenders against
the Borrower and each Guarantor are cumulative. All powers of the Agent and the
Lenders to exercise any right or remedy against, or to require performance by,
any Loan Party shall remain in full force and effect until specifically waived
or released by an instrument in writing executed by the Agent or the Lenders.
     14. 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.
     15.  Jurisdiction. Each Guarantor hereby agrees that ANY LEGAL ACTION OR
PROCEEDING AGAINST SUCH 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 OR OF THE UNITED STATES OF AMERICA FOR
THE SOUTHERN DISTRICT OF NEW YORK AS THE AGENT MAY ELECT, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT EACH GUARANTOR ACCEPTS AND CONSENTS FOR ITSELF AND IN
RESPECT TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS AND AGREES THAT SUCH JURISDICTION SHALL BE EXCLUSIVE, unless
waived by the Agent in writing, with respect to any action or proceeding brought
by it against the Agent or any Lender and any questions relating to usury, and
further consents (to the extent permitted by applicable law) to the service of
process in any such action or proceeding being made upon such Guarantor by mail
at the address stated alongside its name on the signature page hereof or at such
other address as the Agent is notified of in writing in accordance with
Section 18 hereof. Nothing herein shall limit the right of the Agent or the
Lenders to bring proceedings against any Guarantor in the courts of any other
jurisdiction. Each Guarantor covenants that it is and will remain subject to
service of process in the State of New York so long as any of the Indebtedness
is outstanding.
     16. Severability. If any one or more of the provisions contained in this
Agreement or any document executed in connection herewith shall be invalid,
illegal or unenforceable in any respect under any applicable law, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired.
     17. Taxes. All payments hereunder shall be made by each Guarantor to the
Agent without setoff or counterclaim and in such amounts as may be necessary in
order that all such payments received by the Agent, after withholding for or on
account of any present or future taxes, levies, imposts, duties or other similar
charges of whatsoever nature imposed on the amounts payable by such Guarantor
hereunder by any government or any political subdivision or taxing authority
thereof shall not be less than the amount required to be received by the Agent
hereunder. In addition, each Guarantor shall on demand indemnify the Agent for
all income taxes on additional amounts paid pursuant to the preceding sentence.
With respect to each such deduction or withholding, the applicable Guarantor
shall promptly (and in no event later than 30

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days thereafter) furnish to the Agent such certificates, receipts and other
documents as may be required to establish any tax credit, exemption or reduction
in rate related thereto.
     18. Notices, Requests, Demands, Etc. Except as otherwise expressly provided
herein, all notices, requests, demands or other communications to or upon the
respective parties hereto shall be in writing and shall be deemed to have been
duly given or made when delivered, if sent by Federal Express or other similar
overnight delivery service, or three Business Days after mailing (when mailed,
postage prepaid, by registered or certified mail, return receipt requested), or
when sent if sent by telex or telecopier; in each case addressed to the party
entitled to receive same to the address stated alongside its name on the
signature page hereto (or to such other address as any party hereto may
hereafter specify to the other in writing); provided that communications with
respect to a change of address shall be deemed to be effective when actually
received.
     19. Amendment. No provisions of this Agreement shall be waived, amended or
supplemented except by a written instrument executed by the Agent and each
Guarantor directly affected thereby.
     20. Miscellaneous. The provisions of this Agreement will bind and benefit
the successors and assigns of each Guarantor, the Agent and the Lenders. The
term “Borrower” will mean both the named Borrower and any other Person at any
time assuming or otherwise becoming primarily liable on all or any part of the
Indebtedness. The descriptive headings used in this Agreement are for
convenience only and shall not be deemed to affect the meaning or construction
of any provision hereof.
     21. Waiver of Claims. Each Guarantor hereby acknowledges, agrees and
affirms that it possesses no claims, defenses, offsets, recoupment or
counterclaims of any kind or nature against or with respect to the enforcement
of this Agreement or any other Loan Document or any amendments thereto
(collectively, the “Claims”), nor does such Guarantor now have knowledge of any
facts that would or might give rise to any Claims. If facts now exist which
would or could give rise to any Claim against or with respect to the enforcement
of this Agreement or any other Loan Document, as any of the foregoing may have
been amended by the amendments thereto, each Guarantor hereby unconditionally,
irrevocably and unequivocally waives and fully releases any and all such Claims
as if such Claims were the subject of a lawsuit, adjudicated to final judgment
from which no appeal could be taken and therein dismissed with prejudice.
     22. Counterparts. This Agreement may be executed in any number of
counterparts, and by the different parties hereto on the same or separate
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement. Telecopied
signatures hereto shall be of the same force and effect as an original of a
manually signed copy.
     23. WAIVER OF JURY TRIAL. THE AGENT AND EACH GUARANTOR HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS THEY 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

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HERETO, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL
OR WRITTEN), OR ACTIONS OF THE AGENT, THE LENDERS, THE BORROWER, ANY GUARANTOR
OR ANY OTHER LOAN PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENT
ENTERING INTO THIS AGREEMENT AND SUCH OTHER AGREEMENTS AND DOCUMENTS AND FOR THE
LENDERS ENTERING INTO THE REVOLVING CREDIT AGREEMENT.
     24. Joint and Several Obligations. The obligations of the Guarantors
hereunder are joint and several.
     25. Additional Guarantors. With the prior written consent of the Agent, any
Subsidiary or Affiliate of the Borrower may become a party hereto as an
additional joint and several Guarantor by executing such instruments and
agreements as the Agent may require. No consent or other action by any other
Guarantor shall be required in order for any such Subsidiary or Affiliate to
become an additional Guarantor hereunder.
     26. Integration.
          THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES HERETO WITH RESPECT TO THE MATTERS COVERED HEREBY
AND THEREBY AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
          THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[Remainder of Page Intentional Blank — Signature Page to Follow]

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     IN WITNESS WHEREOF, each party hereto has caused this Agreement to be duly
executed as of the date first above written.
Address:

          Attention: Legal Department   FIRSTCITY FINANCIAL CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
        Attention: Legal Department   FIRSTCITY COMMERCIAL CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
        Attention: Legal Department   FIRSTCITY EUROPE CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
        Attention: Legal Department   FIRSTCITY HOLDINGS CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       

[Signature page to Guaranty Agreement]

 

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          Attention: Legal Department   FIRSTCITY INTERNATIONAL CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
        Attention: Legal Department   FIRSTCITY MEXICO, INC.
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
        Attention: Legal Department   FIRSTCITY SERVICING CORPORATION
6400 Imperial Drive (deliveries)
       
Waco, Texas 76712
  By:    
 
       
 
      Name: James C. Holmes
Attention: Legal Department
      Title: Executive Vice President
P.O. Box 8216 (mail)
       
Waco, Texas 76714-8216
       
 
       
(254) 761-2953 (telecopier)
       
 
       
ACCEPTED BY:
       

              BANK OF SCOTLAND, in its capacity as       565 Fifth Avenue the
Agent for the Lenders       New York, New York 10017
 
           
By:
          (212) 883-6610 (telecopier)
 
           
 
  Name: Amena Nabi        
 
  Title: Assistant Vice President        

[Signature page to Guaranty Agreement]