Exhibit 10.3

 

GUARANTY

 

THIS GUARANTY (the “Guaranty”) is made effective as of the 22nd day of November,
2005 by Paycenters, LLC, a Minnesota limited liability company (the “Guarantor”)
to and for the benefit of STEN Acquisition Corporation, a Minnesota corporation
(the “Beneficiary”).

 

BACKGROUND

 

A.            Site Equities International, Inc., a Nevada corporation (the
“Debtor”) and Beneficiary are parties to that certain Loan and Merger Option
Agreement dated of even date herewith (as it may hereafter be amended or
otherwise modified from time to time, the “Agreement”) under which the
Beneficiary, subject to the terms and conditions set forth therein, will lend
certain funds to Debtor, which funds are being provided by Debtor to Guarantor
for the purpose of Guarantor’s acquisition of certain equipment and other items
used in Guarantor’s business.

 

B.            The Guarantor, as the ultimate recipient of funds advanced by
Beneficiary under the Agreement, will benefit substantially from the
transactions described in the Agreement.

 

C.            The Beneficiary is willing to extend such credit to the Debtor
under the Agreement and the Initial Note (as defined in the Agreement) and
Replacement Note (as defined in the Agreement) on the condition that the
Guarantor executes and delivers this Guaranty to the Beneficiary as its absolute
guaranty.  This Guaranty serves as a material inducement for Beneficiary to
enter into the transactions set forth in and contemplated by the Agreement and
Note.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor agrees as follows:

 

1.             Guarantor hereby absolutely and unconditionally guarantees to the
Beneficiary the prompt payment and full performance of each and every debt and
obligation arising pursuant to the terms of the Agreement, the Initial Note and
the Replacement Note (all such debts, liabilities, and obligations are
collectively referred to herein as the “Secured Obligations”).

 

2.             No act or thing need occur to establish the liability of the
Guarantor under this Guaranty, and no act or thing, except full payment and
discharge of all Secured Obligations, will in any way exonerate the Guarantor or
modify, reduce, limit or release the liability of Guarantor under this Guaranty.

 

3.             This is an absolute, unconditional and continuing guaranty of
payment of and performance of the Secured Obligations and will continue to be in
force and be binding upon Guarantor until all Secured Obligations are paid and
satisfied in full.

 

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4.             If the Guarantor is or becomes insolvent (as defined under Title
11, U.S. Code or any similar federal or state law for the relief of debtors)
then the Beneficiary will have the right to declare immediately due and payable,
and the Guarantor will forthwith pay to the Beneficiary, the full amount of all
Secured Obligations, whether due and payable or unmatured.  If the Guarantor
voluntarily commences or there is commenced involuntarily against the Guarantor
or the Debtor a case under the United States Bankruptcy Code, the full amount of
all Secured Obligations, whether due and payable or unmatured, shall be
immediately due and payable without demand or notice thereof.  If there exists
and is continuing an Event of Default (as defined in the Agreement), the full
amount of all Secured Obligations, whether due and payable or unmatured, shall
be immediately due and payable without demand or notice thereof.

 

5.             The Guarantor is liable for all Secured Obligations, without any
limitation as to amount, plus accrued interest thereon and all attorneys’ fees,
collection costs and enforcement expenses referable thereto.

 

6.             Until such time as the Secured Obligations have been indefeasibly
paid in full to the Beneficiary, the Guarantor waives and relinquishes any right
of subrogation or other right of recourse, contribution or reimbursement from
the Debtor and any other right to payment from the Debtor, arising out of or on
account of any sums paid or agreed to be paid by the Guarantor under this
Guaranty, whether any such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
secured, or unsecured.

 

7.             The Guarantor will pay or reimburse the Beneficiary for all costs
and expenses (including reasonable attorneys’ fees and legal expenses) incurred
by the Beneficiary in connection with the successful protection, defense or
enforcement of this Guaranty in any litigation or bankruptcy or insolvency
proceedings.

 

8.             Whether or not any existing relationship between the Guarantor
and the Debtor has been changed or ended, the Beneficiary may, but is not
obligated to, enter into transactions resulting in the continuance of the
Secured Obligations, without any consent or approval by the Guarantor and
without any notice to the Guarantor.  The liability of the Guarantor under this
Guaranty will not be affected or impaired by any of the following acts or things
(which the Beneficiary is expressly authorized to do, omit or suffer from time
to time, without notice to or approval by the Guarantor) except to the extent
that Beneficiary receives payment towards the Secured Obligations:

 

(a)           any acceptance of collateral security, guarantors, accommodation
parties, or sureties for any or all Secured Obligations;

 

(b)           any one or more extensions or renewals of the Secured Obligations
(whether or not for longer than the original period) or any modification of the
interest rates, maturities or other contractual terms applicable to any Secured
Obligations;

 

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(c)           any waiver or indulgence granted to the Debtor, any delay or lack
of diligence in the enforcement of the Secured Obligations, or any failure to
institute proceedings, file a claim, give any required notices or otherwise
protect any Secured Obligations;

 

(d)           any full or partial release of, settlement with, or agreement not
to sue the Debtor, the Guarantor, or other person liable in respect of any
Secured Obligations;

 

(e)           any discharge of any evidence of the Secured Obligations or the
acceptance of any instrument in renewal thereof or substitution therefor;

 

(f)            any failure to obtain collateral security (including rights of
setoff) for the Secured Obligations, or to see to the proper or sufficient
creation and perfection thereof, or to establish the priority thereof, or to
protect, insure, or enforce any collateral security;

 

(g)           any foreclosure or enforcement of any collateral security;

 

(h)           any transfer of any Secured Obligations or any evidence thereof;

 

(i)            any order of application of any payments or credits upon the
Secured Obligations; or

 

(j)            any election by the Beneficiary under §1111(b)(2) of the United
States Bankruptcy Code.

 

9.             Guarantor waives any and all defenses, claims and causes of
action pertaining to the Secured Obligations, except the defense of
(i) discharge of payment in full (or the defense of discharge in part with
respect to any portion of the Secured Obligations actually paid), and (ii) no or
limited liability for the amount claimed due and owing on account
indemnification claims that are capable of being timely asserted by the Debtor
under Section 12 of the Agreement.  Without limiting the generality of the
foregoing, the Guarantor will not assert, plead or enforce against the
Beneficiary any defense of setoff, suretyship, marshalling, subrogation, waiver,
release, discharge in bankruptcy of Debtor, statute of limitations, res
judicata, statute of frauds, anti-deficiency statute, fraud, coercion, duress,
incapacity, minority, usury, illegality, or unenforceability which may be
available to the Guarantor or any other person liable in respect of any Secured
Obligations.  The Guarantor expressly agrees that the Guarantor is and will
remain liable for any deficiency remaining after foreclosure of any mortgage or
security interest securing the Secured Obligations, whether or not the liability
of the Guarantor or any other obligor for such deficiency is discharged pursuant
to statute or judicial decision.

 

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10.           The Guarantor waives presentment, demand for payment, notice of
dishonor or nonpayment, and protest of any instrument evidencing the Secured
Obligations.  The Beneficiary is not required to first resort for payment of the
Secured Obligations from the Debtor or any other persons or their assets or
properties, or first to enforce, realize upon or proceed against any collateral
security for the Secured Obligations, before enforcing this Guaranty.

 

11.           The Guarantor waives all rights and defenses arising out of an
election of remedies by the Beneficiary, even though that election of remedies,
such as a nonjudicial foreclosure with respect to security for a guaranteed
obligation, has destroyed the Guarantor’s rights of subrogation and
reimbursement against the principal by the operation of applicable law.

 

12.           If any payment applied by the Beneficiary to the Secured
Obligations is thereafter set aside, recovered, rescinded or required to be
returned for any reason (including, without limitation, the bankruptcy,
insolvency or reorganization of the Debtor or any other obligor), the Secured
Obligations to which such payment was applied shall for the purposes of this
Guaranty be deemed to have continued in existence, notwithstanding such
application, and this Guaranty will be enforceable as to such Secured
Obligations as fully as if such application had never been made.

 

13.           Beneficiary may demand payment from the Guarantor of any
installment (or portion thereof) of principal or interest on the Notes, when
due, and the Guarantor shall immediately pay the same to the Beneficiary, and
the Beneficiary may demand payment or performance of any or all of the other
Secured Obligations, when such payment or performance is due or required and the
Guarantor shall immediately pay or perform the same, whether or not the
Beneficiary has (1) accelerated payment of the Secured Obligations; or
(2) commenced repossession of, or foreclosure of any security interest, mortgage
or other lien in, any or all of the collateral securing the Secured Obligations;
or (4) otherwise exercised its rights and remedies hereunder or under the
Secured Obligations, the documents related thereto or applicable law.

 

14.           The liability of the Guarantor under this Guaranty is in addition
to and shall be cumulative with all other liabilities of the Guarantor to the
Beneficiary as a Guarantor or otherwise, without any limitation as to amount,
unless the instrument or agreement evidencing or creating such other liability
specifically provides to the contrary.

 

15.           This Guaranty shall be effective upon delivery to the Beneficiary,
without further act, condition or acceptance by the Beneficiary, shall be
binding upon the Guarantor and the successors and assigns of the Guarantor and
shall inure to the benefit of the Beneficiary and its participants, successors
and assigns.  Any invalidity or unenforceability of any provision or application
of this Guaranty shall not affect other lawful provisions and application
hereof, and to this end the provisions of this Guaranty are declared to be
severable.  This Guaranty may not be waived, modified, amended, terminated,
released or otherwise changed except by a writing signed by the Guarantor and
the Beneficiary.

 

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16.           This Guaranty shall be governed by the laws of the State of
Minnesota without regard to conflict of law principles of any jurisdiction.  Any
judicial proceeding with respect to this Agreement shall be brought solely any
federal or state court of competent jurisdiction located in Hennepin County in
the State of Minnesota.  By execution and delivery of this Guaranty, Guarantor:
(i) accepts the exclusive jurisdiction of the aforesaid courts and irrevocably
agrees to be bound by any judgment rendered thereby, (ii) waives personal
service of process, (iii) agrees that service of process upon it may be made by
certified or registered mail, return receipt requested, and (iv) waives any
objection to jurisdiction and venue of any action instituted hereunder and
agrees not to assert any defense based on lack of jurisdiction, venue,
convenience or forum non conveniens.

 

17.           GUARANTOR HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION ARISING UNDER THIS GUARANTY OR IN ANY WAY CONNECTED
WITH OR INCIDENTAL TO THE DEALINGS WITH RESPECT TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.  GUARANTOR HEREBY AGREES AND
CONSENTS THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION MAY BE FILED WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
GUARANTOR TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

 

IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be signed and
dated as of the date first above written.

 

 

 

GUARANTOR:

 

 

 

PAYCENTERS, LLC

 

 

 

 

 

By:

  /s/ Kenneth Antos

 

 

Its:

Manager

 

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