Exhibit 10.3

 
DPS GUARANTEE
 
This DPS Guarantee (as amended, supplemented, restated, replaced or otherwise
modified from time to time, this “Guarantee”) is dated as of August 1, 2013
between
 
DECISIONPOINT SYSTEMS, INC.
(together with its successors and permitted assigns, the “Guarantor”)

and
 
KAREN DALICANDRO
(“Karen”)

and

2293046 ONTARIO INC.,
a corporation formed under the laws of Ontario
(“Karenco”)

 
RECITALS
 
A. Pursuant to a share purchase agreement dated as of June ____, 2012 (the
“Purchase Agreement”) between 2314505 Ontario Inc. (the “Purchaser”), the
Guarantor, Karen, Karenco and Donald Dalicandro, the Purchaser agreed to
purchase from Karen and Karenco (collectively, the “Vendors”), and the Vendors
agreed to sell to the Purchaser, all of the issued and outstanding shares in the
capital of the Apex Systems Integrators Inc. (the “Corporation”).
 
B. As partial consideration for the purchase of shares in the capital of the
Corporation, the Purchaser has issued in favour of the Vendors a convertible
note dated the date hereof in the principal amount of CAD$l (as the same may be
amended, supplemented, restated, replaced or otherwise modified from time to
time, the “Convertible Note”).
 
C. The Purchaser is a wholly-owned subsidiary of the Guarantor. In order to
induce the Vendor to enter into the Purchase Agreement, and for other good and
valuable consideration, Guarantor has agreed to provide the Vendor with this
Guarantee.
 
D. Guarantor has determined that it is in its interest and to its financial
benefit that it enters into this Guarantee.
 
FOR VALUE RECEIVED, the parties agree as follows:
 
 
1

--------------------------------------------------------------------------------

 
 
SECTION 1  – INTERPRETATION
 
1.1 Definitions
 
Capitalized terms used but not defined in this Guarantee shall have the meanings
set forth in Schedule 1.1, and the rules of construction and interpretation set
forth in the Schedule 1.1 shall apply to this Guarantee.
 
1.2 Recitals
 
The recitals to this Guarantee form an integral part of this Guarantee and are
true and correct.
 
SECTION 2  – GUARANTEE
 
2.1 Guarantee
 
Guarantor hereby irrevocably and unconditionally guarantees to Vendors for the
benefit of Vendors and their respective heirs, executors, transferees and
permitted assigns (collectively, the “Guaranteed Parties”) the punctual and
complete payment and satisfaction when due (whether at stated maturity, by
acceleration or otherwise), and at all times thereafter, of all the Obligations,
together with all other obligations and indebtedness of Guarantor under this
Guarantee (collectively, the “Guaranteed Obligations”).  Guarantor also agrees
to pay any and all commercially reasonable expenses (including reasonable
counsel fees and expenses on a substantial indemnity basis) incurred by any
Guaranteed Party in enforcing any rights under this Guarantee.  Guarantor agrees
that this Guarantee is a guarantee of payment and performance and not of
collection, and that its obligations under this Guarantee shall be primary,
absolute and unconditional, irrespective of, and unaffected by:
 
(a)  
the genuineness, validity, regularity, enforceability or any future amendment of
or change in the Purchase Agreement, the Convertible Note, this Guarantee or any
other agreement, document or instrument to which Guarantor or the Purchaser is
or may become a party;

 
(b)  
the absence of any action to enforce the Convertible Note or the waiver or
consent by Vendors with respect to any of the provisions thereof;

 
(c)  
the existence, value or condition of, or the failure to perfect the security
interest of the Vendors in any collateral for the Obligations or any action, or
the absence of any action by any Guaranteed Party in respect thereof (including
the release of any such security);

 
(d)  
the insolvency of the Purchaser; or

 
(e)  
any other action or circumstances that might otherwise constitute a legal or
equitable discharge or defence of a surety or guarantor,

 
it being agreed by Guarantor that its obligations under this Guarantee shall not
be discharged until the Guaranteed Obligations have been fully and irrevocably
paid in full and the Convertible Note has been discharged in accordance with its
terms.  Guarantor and Vendors acknowledge and agree that the foregoing waivers
are of the essence of the transaction contemplated by the Purchase Agreement and
that, but for this Guarantee and such waivers, Vendors would decline to enter
into the Purchase Agreement.
 
 
2

--------------------------------------------------------------------------------

 
 
2.2 Indemnity
 
In addition to the foregoing, as an original and independent obligation under
this Guarantee, Guarantor shall:
 
(a)  
indemnify and save the Guaranteed Parties harmless from and against any cost,
loss, expense or liability of whatever kind (including all commercially
reasonable legal and other costs, charges and expenses incurred by the
Guaranteed Parties in connection with preserving or enforcing, or attempting to
preserve or enforce, its rights under this Guarantee) which may arise or result
from the failure by the Purchaser to make due and punctual payment or
performance of any of the Guaranteed Obligations or which may arise or result
from any of the Guaranteed Obligations or the Convertible Note being or becoming
for any reason whatsoever, in whole or in part (i) void, voidable, ultra vires,
illegal, invalid, ineffective or otherwise unenforceable against the Purchaser,
or (ii) released or discharged by operation of law, including in either case as
a result of the bankruptcy or insolvency of the Purchaser; and

 
(b)  
pay on demand the amount of such cost, loss, expense or liability whether or not
any of the Guaranteed Parties has attempted to enforce any rights against the
Purchaser or any other Person or otherwise.

 
SECTION 3  – OBLIGATIONS ABSOLUTE
 
3.1 Obligations Absolute
 
The obligations of Guarantor hereunder are and shall be absolute and
unconditional and any money or amounts expressed to be owing or payable by
Guarantor hereunder which may not be recoverable from Guarantor on the footing
of a guarantee shall be recoverable from Guarantor as a primary obligor and
principal debtor in respect thereof pursuant to Section 2.2.
 
3.2 Obligations Continuing
 
The obligations of Guarantor hereunder shall continue to be effective or shall
be reinstated, as the case may be, if at any time any payment which would
otherwise have reduced the obligations of Guarantor hereunder (whether such
payment shall have been by or on behalf of the Purchaser or by or on behalf of
Guarantor) is rescinded or reclaimed from any Guaranteed Party, upon the
insolvency, bankruptcy, liquidation or reorganization of Guarantor, the
Purchaser or otherwise, all as though such payment had not been made.
 
SECTION 4  – OBLIGATIONS NOT AFFECTED
 
4.1 Obligations Not Affected
 
The obligations of Guarantor hereunder shall not be affected or impaired by any
act, omission, matter or thing whatsoever, occurring before, upon or after any
demand for payment hereunder (and whether or not known to Guarantor or Vendors)
which, but for this provision, might constitute a whole or partial defence to a
claim against Guarantor hereunder or might operate to release or otherwise
exonerate Guarantor from any of its obligations hereunder or otherwise affect
such obligations, whether occasioned by default of Vendors or otherwise, and
Guarantor hereby irrevocably waives any defence it may now or hereafter have in
any way relating to any of the foregoing, including:
 
(a)  
any limitation of status or power, disability, incapacity or other circumstance
relating to Guarantor or the Purchaser, including any insolvency, bankruptcy,
liquidation, reorganization, readjustment, composition, dissolution, winding-up
or other proceeding involving or affecting Guarantor or the Purchaser;

 
(b)  
any irregularity, defect, unenforceability or invalidity in respect of any
indebtedness or other obligation of Guarantor or the Purchaser;

 
(c)  
any failure of the Purchaser, whether or not without fault on its part, to
perform or comply with any of the  provisions of the Convertible Note or to give
notice thereof to Guarantor;

 
(d)  
the taking, enforcing or exercising or the refusal or neglect to take, enforce
or exercise any right or remedy from or against the Purchaser or its assets or
the release or discharge of any such right or remedies;

 
(e)  
the granting of time, renewals, extensions, compromises, concessions, waivers,
releases, discharges and other indulgences to the Purchaser;

 
(f)  
any amendment, restatement, variation, modification, supplement or replacement
of the Convertible Note or any other document or instrument;

 
(g)  
any change in the ownership, control, name, objects, businesses, assets, capital
structure or constitution of the Purchaser or Guarantor;

 
(h)  
any merger or amalgamation of the Purchaser or Guarantor with any Person or
Persons;

 
(i)  
the occurrence of any change in the laws, rules, regulations or ordinances of
any jurisdiction or by any present or future action of any Governmental
Authority or court amending, varying, reducing or otherwise affecting, or
purporting to amend, vary, reduce or otherwise affect, any of the Guaranteed
Obligations or the obligations of Guarantor under this Guarantee; and

 
(j)  
the existence of any claim, set-off or other rights that Guarantor may have at
any time against the Purchaser, whether in connection with the Purchase
Agreement or otherwise.

 
 
 
3

--------------------------------------------------------------------------------

 
 
4.2 Waiver
 
Without in any way limiting the provisions of Section 4.1 hereof, Guarantor
hereby waives notice of acceptance hereof, notice of any liability of Guarantor
hereunder, notice or proof of reliance by any Guaranteed Party, upon the
obligations of Guarantor hereunder, and diligence, presentment, demand for
payment on Guarantor or the Purchaser, protest, notice of dishonour or
non-payment of any of the Guaranteed Obligations, or subject to Applicable Law,
other notice or formalities to Guarantor or the Purchaser of any kind
whatsoever.  Guarantor further hereby waives any requirement that Vendors
protect, secure, perfect or insure any security interest or encumbrance or any
property subject thereto or exhaust any right or take any action against the
Purchaser, or any other Person or any collateral.
 
4.3 No Obligation to Take Action Against the Purchaser
 
No Guaranteed Party shall have any obligation to enforce any rights or remedies
or to take any other steps against the Purchaser, or any other Person or any
property of the Purchaser or any other Person before Vendors are entitled to
demand payment and performance by Guarantor of its liabilities and obligations
under this Guarantee, and Guarantor hereby waives all benefit of
discussion.  The obligations of Guarantor hereunder are independent of the
Obligations and a separate action or actions may be brought and prosecuted
against Guarantor to enforce this Guarantee, irrespective of whether any action
is brought against the Purchaser or whether the Purchaser is joined in any such
action or actions.
 
4.4 Dealing with Others
 
Any Guaranteed Party may, without releasing, discharging, limiting or otherwise
affecting in whole or in part Guarantor’s obligations and liabilities hereunder
and without the consent of or notice to Guarantor, may:
 
(a)  
grant time, renewals, extensions, compromises, concessions, waivers, releases,
discharges and other indulgences to the Purchaser;

 
(b)  
amend, vary, modify, supplement or replace the Convertible Note or any other
related document or instrument (other than this Guarantee);

 
(c)  
take or abstain from taking security or collateral from the Purchaser or from
perfecting security or collateral of the Purchaser;

 
(d)  
release, discharge, compromise, realize, enforce or otherwise deal with or do
any act or thing in respect of (with or without consideration) any and all
collateral or other security given by the Purchaser or any other Person with
respect to any of the Guaranteed Obligations or matters contemplated by the
Convertible Note;

 
(e)  
accept compromises or arrangements from the Purchaser;

 
(f)  
apply all monies at any time received from the Purchaser upon such part of the
Guaranteed Obligations as Vendors may see fit or change any such application in
whole or in part from time to time as Vendors may see fit; and

 
(g)  
otherwise deal with, or waive or modify the right of the Vendors to deal with
the Purchaser as Vendors may see fit.

 
4.5 Acknowledgement and Representations and Warranties
 
Guarantor hereby acknowledges communication of the terms of the Convertible Note
and of all the provisions therein contained and consents to and approves the
same.  Guarantor hereby represents and warrants that there are no conditions
precedent to the effectiveness of this Guarantee that have not been satisfied or
waived.  Guarantor has, independently and without reliance upon Vendors and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Guarantee.  Guarantor has
established adequate means of obtaining from the Purchaser on a continuing basis
information pertaining to (and is now, and on a continuing basis will be,
completely familiar with) the financial condition, operations, properties and
prospects of the Purchaser.
 
 
4

--------------------------------------------------------------------------------

 
 
4.6 Accounts
 
Guarantor shall be bound by any account settled between the Purchaser and any
Guaranteed Party, and, if no such account has been so settled immediately before
demand for payment under this Guarantee, any account stated by Vendors shall be
accepted by Guarantor as prima facie evidence in the absence of manifest error
of the amount which at the date of the account so stated is due by the Purchaser
to the Guaranteed Parties, or remains unpaid by the Purchaser to any Guaranteed
Party.
 
SECTION 5  – NOTICE
 
5.1 Notice
 
Unless otherwise specified herein, notices, consents, directions, approvals,
reports, appraisals, financial information, instructions, requests and other
communications (each a “Notice”) including under Section 6.1, to a party must be
given in writing and delivered personally or by courier, sent by prepaid
registered mail or transmitted by fax to such party as follows:
 
(a)           if to the Guarantor:
 
19655 Descartes
 
Foothill Ranch, California
 
USA
 
92610
 
Attention:                     Mr. Nicholas Toms, Chief Executive Officer
 
Fax number:                  949-215-9642
 
with a copy (which will not constitute notice) to:
 
McMillan LLP
 
Brookfield Place, 181 Bay Street
 
Suite 4400
 
Toronto, Ontario
 
M5J 2T3
 
Attention:                     Mr. Wayne D. Gray
 
Fax number.:                 416-865-7048
 
(b)           if to the Vendors:
 
3170 Harvester Road
 
Burlington, Ontario
 
L7H 3W8
 
Attention:                     Ms. Karen Dalicandro
 
Fax number:                  905-634-7271
 
with a copy (which will not constitute notice) to:
 
Gardiner Roberts LLP
 
Scotia Plaza, 40 King Street West
 
Suite 3100
 
Toronto, Ontario
 
M5H 3Y2
 
Attention:                     Mr. Robert J. Picard
 
Fax number:                  416-865-6636
 
or to any other address, fax number or person that the respective party hereto
designates.  Any notice, if delivered personally or by courier, will be deemed
to have been given when actually received, if transmitted by fax on a Business
Day, will be deemed to have been given on the next Business Day.
 
 
5

--------------------------------------------------------------------------------

 
 
SECTION 6  – MISCELLANEOUS
 
6.1 Submission to Jurisdiction; Service of Process
 
Without prejudice to the ability of the any party to enforce this Guarantee in
any other proper jurisdiction, each party hereto irrevocably submits and attorns
to the non-exclusive jurisdiction of the courts of the Province of Ontario to
determine all issues, whether at law or in equity, arising from this
Guarantee.  To the extent permitted by Applicable Laws, each party hereto
irrevocably waives any objection (including any claim of inconvenient forum)
that it may now or hereafter have to the venue of any legal proceeding arising
out of or relating to this Guarantee in the courts of such Province or that the
subject matter hereof may not be enforced in such courts and irrevocably agrees
not to seek, and hereby waives any right to judicial review by any court which
may be called upon to enforce the judgment of the courts referred to herein, of
the substantive merits of any such suit, action or proceeding. Without
preventing any other mode of service permitted by Applicable Laws, any document
in an action or proceeding (including any writ of summons or other originating
process or any third or other party notice) may be served on any party by being
delivered to or left for that party at its address for service of notices
specified in Section 5.1.
 
6.2 No Waiver
 
No failure by Vendors to insist upon the strict performance of any term hereof
or to exercise any right, power or remedy upon a default hereunder shall
constitute a waiver of any such default or of any such term. To the fullest
extent permitted by law, no waiver of any default shall affect or alter this
Guarantee, and this Guarantee shall continue in full force and effect with
respect to any other then existing or subsequent default.
 
6.3 Remedies Cumulative
 
For greater certainty, the rights and remedies of Vendors under this Guarantee
and the GSA are cumulative and are in addition to and not in substitution for
any rights or remedies provided by law.  Any single or partial exercise by
Vendors of any right or remedy for a default or breach of any term, covenant,
condition or agreement herein contained shall not be deemed to be a waiver of,
or to alter, affect or prejudice, any other right or remedy or other rights or
remedies to which Vendors may be lawfully entitled for the same default or
breach, and any waiver by Vendors of the strict observance, performance or
compliance with any term, covenant, condition or agreement contained herein or
in the Convertible Note and any indulgence granted thereby, shall be deemed not
to be a waiver of any subsequent default.
 
6.4 Entire Agreement
 
This Guarantee, together with the Convertible Note, the GSA, the Apex Guarantee
and all documents contemplated by or delivered under or in connection with the
Purchase Agreement, constitutes the entire agreement between the parties hereto
with respect to the subject matter and supersedes all prior agreements,
negotiations, discussions, understandings, representations, warranties and
undertakings, whether written or oral.
 
6.5 Successors and Assignees
 
This Guarantee shall be binding upon and enure to the benefit of Guarantor and
Vendors and their respective successors, heirs, executors, personal and legal
representatives and permitted assignees, except that Guarantor may not assign
any of its obligations hereunder and the Vendor may only assign this Guarantee
to an assignee of the Convertible Note.
 
 
6

--------------------------------------------------------------------------------

 
 
6.6 Governing Law
 
This Guarantee shall be governed and construed in accordance with the laws of
the Province of Ontario and the federal laws of Canada applicable therein.
 
6.7 Submission to Jurisdiction
 
Without prejudice to the ability of the Vendors to enforce this Guarantee in any
other proper jurisdiction, the Guarantor irrevocably submits and attorns to the
non-exclusive jurisdiction of the courts of Ontario to determine all issues,
whether at law or in equity, arising from this Guarantee.
 
6.8 Provisions Incorporated by Reference
 
The following provisions of the Purchase Agreement shall be incorporated by
reference mutatis mutandis into this Guarantee:
 
(a)  
Section 1.5 – Calculation of Time;

 
(b)  
Section 1.7 – Additional Rules of Interpretation;

 
(c)  
Section 8.8 - Amendment;

 
(d)  
Section 8.10 – Severability; and

 
(e)  
Section 8.13 – Counterparts and Facsimile.

 

 
[signature page follows]
 
 
7

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, this Guarantee has been duly executed as of the date first
written above.
 

  DECISIONPOINT SYSTEMS, INC.          
 
By:
/s/        Name:        Title:           

 
 
 
 
8

--------------------------------------------------------------------------------

 
 
Schedule 1.1 – Definitions and Interpretation
 
A. Interpretation.
 
The following capitalized terms used in this Guarantee shall have the meanings
given to them in the Purchase Agreement: “Apex Guarantee”, “Applicable Law”;
“Business Day”; “Governmental Authority”; “GSA”, “Order”; and “Person”.
 
In addition, each term defined herein has the meaning indicated for such term
below when used in this Guarantee:
 
Creditor Note has the meaning given to it in recital B of this Guarantee.
 
Guaranteed Obligations shall have the meaning given to it in Section 2.1 of this
Guarantee.
 
Guaranteed Parties shall have the meaning given to it in Section 2.1 of this
Guarantee.
 
Notice shall have the meaning given to it in Section 5.1 of this Guarantee.
 
Obligations shall mean the collective reference to the instalment of principal,
interest and enforcement costs under the Convertible Note (including interest
accruing at the then applicable rate under the Creditor Note after the date for
payment of any instalment of the principal and interest accruing at the then
applicable rate after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Purchaser, whether or not a claim for post-filing or post-petition
interest  is allowed in such proceeding), whether due or to become due.
 
Purchase Agreement shall have the meaning given to it in recital A of this
Guarantee.
 
Purchaser shall have the meaning given to it in recital A of this Guarantee.
 
Vendors shall have the meaning given to it in recital A of this Guarantee.
 
B. Conflict in Sale Documents. If there is any conflict between this Guarantee
and the Purchase Agreement, each document shall be interpreted and construed, if
possible, so as to avoid or minimize such conflict, but, to the extent (and only
to the extent) of such conflict, the Purchase Agreement shall prevail. Where a
payment obligation is set forth in any document and another document makes
reference to the same payment obligation, payment shall be made without
duplication.
 

 
 
 
9