Exhibit 10.4


     

      
        

      

    

    Exhibit
      10.4

     

    

      REPAYMENT
        GUARANTY

      


      THIS
        REPAYMENT GUARANTY
        (as
        amended, modified, extended, and renewed from time to time, the “Guaranty”),
        dated
        as of March 14, 2007, is made by FRANKLIN
        COVEY PRINTING, INC.,
        a Utah
        corporation, FRANKLIN
        DEVELOPMENT CORPORATION,
        a Utah
        corporation, FRANKLIN
        COVEY TRAVEL, INC.,
        a Utah
        corporation, FRANKLIN
        COVEY CATALOG SALES, INC.,
        a Utah
        corporation, FRANKLIN
        COVEY CLIENT SALES, INC.,
        a Utah
        corporation, FRANKLIN
        COVEY PRODUCT SALES,
        a Utah
        corporation, FRANKLIN
        COVEY SERVICES, L.L.C.,
        a Utah
        limited liability company, and FRANKLIN
        COVEY MARKETING, LTD.,
        a Utah
        limited partnership (individually and collectively, as the context requires,
        and
        jointly and severally, “Guarantor”),
        in
        favor of JPMORGAN
        CHASE BANK, N.A.,
        a
        national banking association (“Lender”),
        in
        conjunction with the Loan made to FRANKLIN
        COVEY CO.,
        a Utah
        corporation (“Borrower”),
        by
        Lender pursuant to the Loan Agreement.

       

      1.  DEFINITIONS.
        Except
        as otherwise provided in this Guaranty, all terms defined in the Loan Agreement
        shall have the same meaning when used in this Guaranty. In addition, the
        following terms shall have the following meanings:

       

      (a)  “Change
        of Control”
(a)
        means the closing of a sale or other disposition of all or substantially
        all of
        Guarantor’s assets; (b) shall be deemed to have occurred at such time as a
“person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the
        Securities Exchange Act of 1934, as amended), becomes the “beneficial owner” (as
        defined in Rule 13d3 under the Securities Exchange Act of 1934, as amended),
        directly or indirectly, of more than fifty percent (50%) of the total voting
        power of all classes of stock then outstanding of Guarantor entitled to vote
        in
        the election of directors; or (c) Guarantor’s merger into or consolidation with
        any other entity, or any other reorganization or transfer, directly or
        indirectly, of the ownership interests in Guarantor, in which the holders
        of the
        outstanding ownership interests in Guarantor immediately prior to such
        transaction receive or retain, in connection with such transaction on account
        of
        their ownership interests, ownership interests representing less than fifty
        percent (50%) of the voting power of the entity surviving such transaction;
        provided,
        however,
        that a
        Change of Control shall not include a merger effected exclusively for the
        purpose of changing the domicile of Guarantor or a merger of a Guarantor
        into
        Borrower or another Guarantor.

       

      (b)  “Guarantor
        Loan Documents”
means
        this Guaranty and any other guaranties, agreements, documents, or instruments
        now or hereafter executed by Guarantor evidencing, guarantying, securing
        or
        otherwise related to the Guarantor Obligations or the Loan, as this Guaranty
        and
        such other guaranties, agreements, documents, and instruments may be amended,
        modified, extended, renewed, or supplemented from time to time.

       

      (c)  “Guaranty”
means
        this Guaranty, as it may be amended, modified, extended, and renewed, from
        time
        to time.

       

      (d)  “Loan”
means
        a
        revolving line of credit in the maximum principal amount of EIGHTEEN MILLION
        AND
        NO/100 DOLLARS ($18,000,000.00) made to Borrower by Lender pursuant to the
        Loan
        Agreement.

       

      (e)  “Loan
        Agreement”
means
        that certain Revolving Line of Credit Agreement of approximate even date
        herewith between Borrower and Lender, as amended, modified, extended or renewed
        from time to time.

       

      (f)  “Loan
        Party”
means
        Borrower, Guarantor, and each other person that from time to time is obligated
        to Lender under any Loan Document or grants any of the Collateral.

       

      (g)  “Obligations”
means
        the following:

       

      (i)  Payment
        of principal, interest, costs, expenses, fees, and other amounts under the
        Note
        or other Loan Documents;

       

      (ii)  Payment
        of all other amounts payable from time to time by Borrower under the Loan
        Documents; and

       

      (iii)  The
        prompt and complete performance of the obligations of Borrower, as set forth
        in
        the Loan Agreement and other Loan Documents.

       

      (h)  Actions
        by Lender.
        Unless
        otherwise expressly provided in this Guaranty, all determinations, consents,
        approvals, disapprovals, calculations, requirements, requests, acts, actions,
        elections, selections, opinions, judgments, options, exercise of rights,
        remedies or indemnities, satisfaction of conditions or other decisions of
        or to
        be made by Lender under this Guaranty shall be made in the reasonable discretion
        of Lender. Any reference to Lender’s “sole and absolute discretion” or similar
        phrases has the meaning represented by the phrase “sole and absolute discretion,
        acting in good faith”.

       

      2.  GUARANTY.
        FOR
        GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH GUARANTOR
        ACKNOWLEDGES, GUARANTOR UNCONDITIONALLY AND IRREVOCABLY, AND JOINTLY AND
        SEVERALLY, GUARANTEES THE FULL PAYMENT AND PERFORMANCE WHEN DUE, BY ACCELERATION
        OR OTHERWISE, OF EACH AND ALL OBLIGATIONS. GUARANTOR AGREES THAT IMMEDIATELY
        UPON A FAILURE IN PAYMENT OR PERFORMANCE WHEN DUE OF ANY OR ALL OBLIGATIONS,
        GUARANTOR WILL PAY TO LENDER THE FULL AMOUNT OF, OR PERFORM IN FULL, SUCH
        OBLIGATIONS. ALL PAYMENTS UNDER THIS GUARANTY SHALL BE MADE TO LENDER IN
        LAWFUL
        MONEY OF THE UNITED STATES OF AMERICA AT THE ADDRESS OF LENDER DESIGNATED
        IN THE
        LOAN AGREEMENT OR SUCH OTHER LOCATION AS LENDER MAY DESIGNATE IN WRITING.
        ANY
        AMOUNT PAYABLE UNDER THIS GUARANTY NOT PAID WHEN DUE, AND ANY JUDGMENT FOR
        SUCH
        AN AMOUNT AND INTEREST THEREON, SHALL BEAR INTEREST AT THE DEFAULT INTEREST
        RATE
        FROM THE DUE DATE OR SUCH JUDGMENT DATE, RESPECTIVELY, UNTIL SUCH AMOUNT
        AND
        INTEREST THEREON ARE PAID IN FULL. GUARANTOR AGREES TO PAY SUCH INTEREST
        ON
        DEMAND. ALL OF GUARANTOR’S OBLIGATIONS HEREUNDER WILL BE PAID AND PERFORMED BY
        GUARANTOR WITHOUT COUNTERCLAIM, DEDUCTION, DEFENSE, DEFERMENT, REDUCTION,
        OR
        SET-OFF (all of the foregoing obligations of Guarantor and any and all other
        obligations, duties and responsibilities of Guarantor hereunder shall be
        referred to herein collectively as the “Guarantor
        Obligations”).

       

      3.  SECURITY.
        Payment
        and performance of the Guarantor Obligations by Guarantor shall be secured
        by a
        Security Agreement of even date herewith by and between Guarantor and Lender,
        creating a first priority security interest in all personal property assets
        of
each
        Guarantor.

       

      4.  GUARANTOR
        REPRESENTATIONS AND WARRANTIES.
        Guarantor represents and warrants to Lender as of the date of this
        Guaranty:

       

      (a)  Organization
        and Powers.
        Guarantor is either a corporation, a limited liability company, or a limited
        partnership duly organized and validly existing under the laws of the State
        of
        Utah. Guarantor has all requisite power and authority, rights and franchises
        to
        own and operate its properties, to carry on its business as now conducted
        and as
        proposed to be conducted, and to enter into and perform this Guaranty and
        the
        other Loan Documents to which it is a party. The address of Guarantor’s chief
        executive office and principal place of business is c/o Franklin Covey Co,
        2200
        West Parkway Blvd., Salt Lake City, Utah 84119.

       

      (b)  Good
        Standing.
        Guarantor has made all filings and is in good standing in the State of Utah,
        and
        in each other jurisdiction in which the character of the property it owns
        or the
        nature of the business it transacts makes such filings necessary and where
        failure to make such filings would result in a Material Adverse
        Change.

       

      (c)  Authorization.
        The
        execution, delivery and performance of the Guarantor Loan Documents by Guarantor
        are within Guarantor’s corporate, limited liability company or partnership
        powers and have been duly authorized by all necessary action by Guarantor
        and
        its directors, shareholders, members, managers and partners, as
        applicable.

       

      (d)  No
        Conflict.
        The
        execution, delivery and performance of the Guarantor Loan Documents by Guarantor
        will not violate (1) any provision of the Guarantor Operating Documents;
        (2) any
        legal requirement affecting Guarantor or any of Guarantor’s respective
        properties except where a violation of such requirement would not result
        in a
        Material Adverse Change; or (3) any agreement to which Guarantor is bound
        or to
        which Guarantor is a party, except where a violation of any such agreement
        would
        not result in a Material Adverse Change, and will not result in or require
        the
        creation (except as provided in or contemplated by this Guaranty and the
        Loan
        Agreement) of any Lien or Encumbrance upon any of such properties.

       

      (e)  No
        Approvals, etc.
        All
        governmental or regulatory orders, consents, permits, authorizations and
        approvals required for the present use and operation of the Guarantor’s business
        and the Collateral pledged by Guarantor have been obtained and are in full
        force
        and effect, except where failure to obtain such orders, consents, permits,
        authorizations or approvals would not result in a Material Adverse Change.
        To
        the knowledge of Guarantor, no additional governmental or regulatory actions,
        filings or registrations with respect to the Guarantor’s business and the
        Collateral pledged by Guarantor, and no approvals, authorizations or consents
        of
        any trustee or holder of any Indebtedness or obligation of Guarantor are
        required for the due execution, delivery and performance by Guarantor of
        their
        respective duties and obligations under the Guarantor Loan
        Documents.

       

      (f)  Binding
        Obligations.
        This
        Guaranty and the other Guarantor Loan Documents have been duly executed by
        Guarantor, and are the legally valid and binding obligations of Guarantor,
        enforceable against Guarantor in accordance with their terms, except as
        enforceability may be limited by bankruptcy, insolvency, reorganization,
        moratorium or similar Requirements of Laws affecting creditors’ rights generally
        and by general principles of equity.

       

      (g)  Solvency.
        After
        giving effect to this Guaranty, Guarantor is solvent. As used in the preceding
        sentence, “solvent”
means,
        with respect to any person, that at the time of determination:

       

      (i)  the
        fair
        value of its assets, both at fair valuation and at present fair saleable
        value,
        is in excess of the total amount of its liabilities, including, without
        limitation, contingent claims; and

       

      (ii)  it
        is
        then able and expects to be able to pay its debts as they mature;
        and

       

      (iii)  it
        has
        capital sufficient to carry on its business as conducted and as proposed
        to be
        conducted.

       

      Contingent
        liabilities (such as litigation, guaranties, including but not limited to
        this
        Guaranty, and pension plan liabilities) shall be computed at the amount which,
        in light of all the facts and circumstances existing at the time, represents
        the
        amount which can reasonably be expected to become an actual or matured
        liability.

       

      (h)  Inducement.
        Guarantor acknowledges and agrees that this Guaranty is being executed and
        delivered in connection with, and as an inducement for Lender to extend,
        various
        credit accommodations to Borrower that are beneficial to the ongoing business
        and operations of Borrower and Guarantor.

       

      5.  GUARANTOR
        COVENANTS.
        Until
        the Obligations are paid and performed in full, Guarantor agrees that, unless
        Lender otherwise agrees in writing in Lender’s absolute and sole
        discretion:

       

      (a)  Keeping
        Informed About Borrower and Transaction.
        Guarantor understands the Obligations and the Guarantor Obligations and has
        had
        access to information about the financial condition of Borrower and the ability
        of Borrower to perform the Obligations. Guarantor assumes responsibility
        for
        acquiring and maintaining all necessary information concerning the financial
        condition of the Borrower, and any and all endorsers and other guarantors
        of any
        instrument or document evidencing all or any part of the Obligations, and
        of all
        other circumstances bearing upon the risk of nonpayment of the Obligations
        or
        any part thereof that diligent inquiry would reveal, and Guarantor hereby
        agrees
        that Lender shall have no duty to advise Guarantor of information known to
        Lender regarding such condition or circumstances.

       

      (b)  Transfer
        of Assets.
        Unless
        such action would result in a Material Adverse Change (without taking into
        consideration subsections (iii) and (iv) of the definition of Material Adverse
        Change), Guarantor may sell, convey, transfer, assign or dispose of Guarantor’s
        properties or assets, or any right, title or interest, or any part thereof,
        or
        enter into any lease covering all or any portion thereof or an undivided
        interest therein, either voluntarily, involuntarily, or otherwise; provided,
        however,
        that
        Guarantor shall not sell, transfer, lease, or otherwise dispose of all or
        any
        substantial part of its properties or assets other than such a sale, transfer,
        lease or disposition to Borrower or another Guarantor.

       

      (c)  Change
        of Control.
        Without
        the prior written consent of Lender, which consent will not be unreasonably
        withheld or delayed, Guarantor shall not cause, permit, or suffer any Change
        of
        Control to occur.

       

      6.  SPECIAL
        PROVISIONS.

       

      (a)  Nature
        of Guaranty.
        This
        Guaranty is absolute, continuing, irrevocable, and unconditional. This Guaranty
        is a guaranty of payment and performance when due and not of collection.
        This
        Guaranty shall be effective and remain in full force and effect until all
        Obligations are paid and performed in full, regardless of (i) the genuineness,
        regularity, legality, validity, or enforceability of any or all of the liens
        and
        encumbrances securing the Obligations, the Loan Documents, or the Obligations,
        (ii) any law, regulation, or rule (federal, state, or local) or any action
        by
        any Governmental Authority discharging, reducing, varying the terms of payment,
        or otherwise modifying any of the Obligations or any of the liens and
        encumbrances securing the Obligations, or (iii) the death, dissolution, or
        liquidation of Borrower or any Guarantor.

       

      (b)  Enforcement
        Against Guarantor Without Other Action.
        Lender,
        in its sole and absolute discretion, may enforce this Guaranty against any
        Guarantor without first having sought enforcement of any Loan Documents against
        Borrower, any other Guarantor, or any collateral.

       

      (c)  Events
        Not Affecting Guarantor Obligations.
        The
        following shall not affect, impair, or delay the enforcement of this Guaranty,
        regardless of the impact upon any contribution, exoneration, indemnification,
        reimbursement, subrogation, and other rights of Guarantor:

       

      (i)  The
        bankruptcy, death, disability, dissolution, incompetence, insolvency,
        liquidation, or reorganization of Borrower.

       

      (ii)  Any
        defense of Borrower to payment or performance of any or all Obligations,
        or
        enforcement of any or all liens and encumbrances securing the Obligations
        on
        this Guaranty.

       

      (iii)  The
        disallowance, discharge, modification of the terms of, reduction in the amount
        of, or stay of enforcement of any or all Obligations, or any or all liens
        and
        encumbrances securing the Obligations, in any bankruptcy, insolvency,
        reorganization, or other legal proceeding or by any law, ordinance, regulation,
        or rule (federal, state, or local).

       

      (iv)  The
        cessation of liability of Borrower for any or all Obligations without full
        satisfaction of such Obligations.

       

      (d)  Acts
        and Omissions of Lender Not Affecting this Guaranty.
        The
        following acts and omissions of Lender, in each case in its sole and absolute
        discretion, shall not affect, delay, or impair this Guaranty, regardless
        of the
        impact upon any contribution, exoneration, indemnification, reimbursement,
        subrogation, or other rights of Guarantor:

       

      (i)  Lender
        may compromise, delay enforcement, fail to enforce, release, settle, or waive
        any or all Obligations of Borrower or any or all rights and remedies of Lender
        against Borrower.

       

      (ii)  Lender
        may make advances, issue letters of credit, or grant other financial
        accommodations for Borrower without requiring satisfaction of all conditions
        precedent in the Loan Documents.

       

      (iii)  Lender
        may obtain, substitute, and release collateral or additional collateral for
        the
        Obligations or this Guaranty.

       

      (iv)  Lender
        may fail to perfect, fail to protect the priority of, and fail to insure
        any or
        all liens and encumbrances in such collateral.

       

      (v)  Lender
        may fail to inspect, insure, maintain, preserve, or protect any or all such
        collateral.

       

      (vi)  Lender
        may enforce, compromise, delay enforcement, fail to enforce, settle, or waive
        any rights and remedies of Lender as to any or all such collateral.

       

      (vii)  Lender
        may assemble, sell, or otherwise dispose of any collateral in any manner
        and
        order Lender determines in its absolute and sole discretion, and disposition
        may
        be for no value, or for less than fair market value, of the collateral in
        the
        absolute and sole discretion of Lender. With respect to any collateral that
        is
        personal property, Lender shall give Guarantor ten (10) days’ prior written
        notice of any sale or other disposition, except for personal property collateral
        that is perishable, threatens to decline speedily in value, is of a type
        customarily sold on a recognized market, or is cash, cash equivalents,
        certificates of deposit or the like, and except as to Lender’s right of set-off.
        Guarantor’s sole right with respect to all collateral shall be to bid at a sale
        thereof in accordance with applicable law.

       

      (viii)  Lender
        may obtain additional obligors for any or all Obligations, and may substitute
        or
        release Borrower or any other obligor.

       

      (ix)  Lender
        may fail to file or pursue a claim in any bankruptcy, insolvency, probate,
        reorganization, or other proceeding as to any or all Obligations or any or
        all
        liens and encumbrances securing the Obligations.

       

      (x)  Lender
        may subordinate (A) any or all liens and encumbrances securing the Obligations
        or this Guaranty, or (B) any or all Obligations.

       

      (xi)  Lender
        may amend, modify, extend, renew, restate, supplement, or terminate in whole
        or
        in part any or all Loan Documents.

       

      (xii)  Lender
        may assign any or all of its rights and delegate its obligations under the
        Loan
        Documents, in whole or in part (including, without limitation, by
        participation).

       

      (xiii)  Lender
        may do any other act or make any other omission that might otherwise constitute
        an extinguishment or a legal or equitable discharge of, or defense by,
        Guarantor.

       

      7.  GUARANTOR
        WAIVERS.

       

      (a)  Note
        and Notice Waivers.
        Guarantor waives, to the full extent permitted by law, presentment, notice
        of
        dishonor, protest, notice of protest, notice of intent to accelerate, notice
        of
        acceleration, and all other notices or demands of any kind (including, without
        limitation, notice of the acceptance by Lender of this Guaranty, notice of
        the
        existence, creation, non-payment, or non-performance of any or all Obligations,
        and notice of the acts or omissions described in Sections
        6(c) and
        6(d), excepting
        only notices specifically provided for in this Guaranty).

       

      (b)  Waiver
        of Acts and Omissions of Lender.
        Guarantor waives any defense to enforcement of the Guarantor Obligations
        or any
        liens and encumbrances granted by Guarantor based on acts and omissions of
        Lender described in Sections
        6(c)
        and
6(d).

       

      (c)  Waiver
        of Statutory Provisions.
        Guarantor waives any and all rights and benefits under Utah
        Code Annotated§
        78-37-1, Utah
        Code Annotated§
        57-1-32 and
        any
        other similar or replacement statutes or rules now or hereafter in effect
        and
        any other statutes or rules now or hereafter in effect that purport to confer
        specific rights upon, or make specific defenses or procedures available to,
        guarantors, or limit the right of Lender to recover a deficiency judgment,
        or to
        otherwise proceed, against any person or entity obligated for payment of
        the
        Loan, after any trustee’s sale, any judicial foreclosure sale or any personal
        property sale of any collateral securing the Loan.

       

      (d)  Waiver
        of Statute of Limitations.
        To the
        full extent permitted by law, Guarantor waives any and all statutes of
        limitations as a defense to any or all Obligations.

       

      (e)  Waiver
        of Law and Equitable Principles Conflicting With This Guaranty.
        Guarantor waives any and all provisions of law and equitable principles that
        conflict with this Guaranty.

       

      (f)  Waiver
        of Any Obligation of Lender to Inform Guarantor.
        Guarantor waives any right to require Lender, and Lender shall have no
        obligation, to provide to Guarantor any information concerning performance
        of
        the Obligations, the ability of Borrower to perform the Obligations, or any
        other matter, regardless of what information Lender may have from time to
        time.

       

      (g)  Waiver
        of Contribution, Exoneration, Indemnification, Reimbursement, Subrogation,
        and
        Other Rights Against Borrower and Other Loan Parties.
        Until
        such time as the Obligations have been fully satisfied, Guarantor waives
        any and
        all present and future claims, remedies, and rights of Guarantor against
        Borrower or any other guarantor, any collateral, and any other property,
        interests in property, or rights to property of Borrower or any other guarantor
        (i) arising from any performance by Guarantor hereunder, (ii) arising from
        any
        application of any collateral or any other property, interests in property,
        or
        rights to property of Guarantor to payment or performance of the Obligations,
        or
        (iii) otherwise arising in respect of the Loan Documents, regardless of whether
        such claims, remedies, and rights arise under any present or future agreement,
        document, or instrument or are provided by any law, ordinance, regulation,
        or
        rule (federal, state, or local) (including, without limitation, (A) any and
        all
        rights of contribution, exoneration, indemnity, reimbursement, and subrogation,
        and (B) any and all rights to participate in the rights and remedies of Lender
        against Borrower, any other guarantor, and any collateral).

       

      (h)  WAIVER
        OF JURY TRIAL.
        EACH OF
        GUARANTOR AND LENDER (BY ITS ACCEPTANCE HEREOF) HEREBY WAIVES, TO THE FULLEST
        EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY
        IN
        ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
        THIS
        GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED UPON CONTRACT,
        TORT OR ANY OTHER THEORY). EACH OF GUARANTOR AND LENDER (BY ITS ACCEPTANCE
        HEREOF) (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
        PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
        NOT,
        IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
        ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
        INTO THIS GUARANTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
        IN THIS SECTION.

       

      (i)  WAIVER
        OF SPECIAL DAMAGES. TO
        THE
        EXTENT PERMITTED BY APPLICABLE LAW, GUARANTOR SHALL NOT ASSERT, AND HEREBY
        WAIVES, ANY CLAIM AGAINST LENDER, ON ANY THEORY OF LIABILITY, FOR SPECIAL,
        INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL
        DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS GUARANTY
        OR
        ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY, THE TRANSACTIONS, THE LOAN
        OR
        THE USE OF THE PROCEEDS THEREOF.

       

      (j)  MISCELLANEOUS
        WAIVERS.
        TO THE
        FULLEST EXTENT PERMITTED BY APPLICABLE LAW, GUARANTOR HEREBY WAIVES ANY AND
        ALL
        RIGHTS TO REQUIRE MARSHALLING OF ASSETS BY LENDER. WITH RESPECT TO ANY SUIT,
        ACTION OR PROCEEDINGS RELATING TO THIS GUARANTY OR THE OTHER GUARANTOR LOAN
        DOCUMENTS (EACH, A “PROCEEDING”),
        GUARANTOR IRREVOCABLY (A) SUBMITS TO THE JURISDICTION OF THE STATE AND FEDERAL
        COURTS HAVING JURISDICTION IN THE CITY OF SALT LAKE, COUNTY OF SALT LAKE
        AND
        STATE OF UTAH, AND (B) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME
        TO THE
        LAYING OF VENUE OF ANY PROCEEDING BROUGHT IN ANY SUCH COURT, WAIVES ANY CLAIM
        THAT ANY PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND FURTHER
        WAIVES
        THE RIGHT TO OBJECT, WITH RESPECT TO SUCH PROCEEDING, THAT SUCH COURT DOES
        NOT
        HAVE JURISDICTION OVER SUCH PARTY. NOTHING IN THIS GUARANTY SHALL PRECLUDE
        LENDER FROM BRINGING A PROCEEDING IN ANY OTHER JURISDICTION NOR WILL THE
        BRINGING OF A PROCEEDING IN ANY ONE OR MORE JURISDICTIONS PRECLUDE THE BRINGING
        OF A PROCEEDING IN ANY OTHER JURISDICTION. GUARANTOR FURTHER AGREES AND CONSENTS
        THAT, IN ADDITION TO ANY METHODS OF SERVICE OF PROCESS PROVIDED FOR UNDER
        APPLICABLE LAW, ALL SERVICE OF PROCESS IN ANY PROCEEDING IN ANY UTAH STATE
        OR
        UNITED STATES COURT SITTING IN THE CITY OF SALT LAKE AND COUNTY OF SALT LAKE
        MAY
        BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, DIRECTED
        TO
        GUARANTOR AT THE ADDRESS INDICATED BELOW, AND SERVICE SO MADE SHALL BE COMPLETE
        UPON RECEIPT; EXCEPT
        THAT IF
        GUARANTOR SHALL REFUSE TO ACCEPT DELIVERY, SERVICE SHALL BE DEEMED COMPLETE
        FIVE
        (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO MAILED.

       

      8.  SUBORDINATION.
        If from
        time to time Borrower shall have liabilities or obligations to Guarantor,
        such
        liabilities and obligations and any and all assignments as security, grants
        in
        trust, liens, mortgages, security interests, other encumbrances, and other
        interests and rights securing such liabilities and obligations shall at all
        times be fully subordinate with respect to (a) assignment as security, grant
        in
        trust, lien, mortgage, security interest, other encumbrance, and other interest
        and right (if any), (b) time and right of payment and performance, and (c)
        rights against any collateral therefor (if any), to payment and performance
        in
        full of the Obligations and the right of Lender to realize upon any or all
        Collateral. Guarantor agrees that such liabilities and obligations of Borrower
        to Guarantor shall not be secured by any assignment as security, grant in
        trust,
        lien, mortgage, security interest, other encumbrance or other interest or
        right
        in any property, interests in property, or rights to property of Borrower
        and
        that during the continuance of an Event of Default, Borrower shall not pay,
        and
        Guarantor shall not receive, payments of any or all liabilities or obligations
        of Borrower to Guarantor until after payment and performance of the Obligations
        in full, unless Lender consents thereto in writing. If, notwithstanding the
        foregoing, during the continuance of an Event of Default, Guarantor receives
        any
        payment from Borrower, such payment shall be held in trust by Guarantor for
        the
        benefit of Lender, shall be segregated from the other funds of Guarantor,
        and
        shall forthwith be paid by Guarantor to Lender and applied to payment of
        the
        Obligations, whether or not then due. To secure this Guaranty, Guarantor
        grants
        to Lender a lien and security interest in all liabilities and obligations
        of
        Borrower to Guarantor, in any assignments as security, grants in trust, liens,
        mortgages, security interests, other encumbrances, other interests or rights
        securing such liabilities and obligations, and in all of Guarantor’s right,
        title, and interest in and to any payments, property, interests in property,
        or
        rights to property acquired or received by Guarantor from Borrower in respect
        of
        any liabilities or obligations of Borrower to Guarantor.

       

      9.  LIMITATION
        ON OBLIGATIONS.
        The
        provisions of this Guaranty are severable, and in any action or proceeding
        involving any state corporate law, or any state, federal or foreign bankruptcy,
        insolvency, reorganization or other law affecting the rights of creditors
        generally, if the obligations of Guarantor under this Guaranty would otherwise
        be held or determined to be avoidable, invalid or unenforceable on account
        of
        the amount of Guarantor’s liability under this Guaranty, then, notwithstanding
        any other provision of this Guaranty to the contrary, the amount of such
        liability shall, without any further action by Guarantor or Lender, be
        automatically limited and reduced to the highest amount that is valid and
        enforceable as determined in such action or proceeding (such highest amount
        determined hereunder being Guarantor’s “Maximum
        Liability”).
        This
        Section
        9
        with
        respect to the Maximum Liability of Guarantor is intended solely to preserve
        the
        rights of Lender hereunder to the maximum extent not subject to avoidance
        under
        applicable law, and neither Guarantor nor any other person or entity shall
        have
        any right or claim under this Section
        9
        with
        respect to the Maximum Liability, except to the extent necessary so that
        the
        obligations of Guarantor hereunder shall not be rendered voidable under
        applicable law.

       

      10.  RIGHTS
        AND REMEDIES OF LENDER.
        The
        rights and remedies of Lender shall be cumulative and non-exclusive. Delay,
        discontinuance, or failure to exercise any right or remedy of Lender shall
        not
        be a waiver thereof, of any other right or remedy of Lender, or of the time
        of
        the essence provision. Exercise of any right or remedy of Lender shall not
        cure
        or waive any Event of Default or invalidate any act done in response to any
        Event of Default.

       

      11.  SURVIVAL.
        The
        representations, warranties, and covenants of Guarantor in this Guaranty
        shall
        survive the execution and delivery of this Guaranty.

       

      12.  INTEGRATION,
        ENTIRE AGREEMENT, CHANGE, DISCHARGE, TERMINATION, WAIVER, APPROVAL, CONSENT,
        ETC.
        This
        Guaranty contains the complete understanding and agreement of Guarantor and
        Lender and supersedes all prior representations, warranties, agreements,
        arrangements, understandings, and negotiations. No provision of this Guaranty
        may be changed, discharged, supplemented, terminated, or waived except in
        a
        writing signed by the parties thereto. Delay or failure by Lender to insist
        on
        performance of any obligation when due or compliance with any other term
        or
        condition in this Guaranty shall not operate as a waiver thereof or of any
        other
        obligation, term, or condition or of the time of the essence provision.
        Acceptance of late payments or performance shall not be a waiver of the time
        of
        the essence provision, the right of Lender to require that subsequent payments
        or performance be made when due, or the right of Lender to declare an Event
        of
        Default if subsequent payments or performance are not made when due. Any
        approval, consent, or statement that a matter is satisfactory by Lender under
        this Guaranty must be in writing executed by Lender and shall apply only
        to the
        person(s) and facts specifically set forth in the writing.

       

      13.  BINDING
        EFFECT.
        This
        Guaranty shall be binding upon Guarantor and shall inure to the benefit of
        Lender and their successors and assigns, and the executors, legal
        administrators, personal representatives, heirs, devisees, and beneficiaries
        of
        Guarantor, provided,
        however,
        that
        Guarantor may not delegate any of its obligations under this Guaranty and
        any
        purported delegation shall be void. Lender may from time to time in its absolute
        and sole discretion assign its rights and delegate its obligations under
        the
        Loan Documents, in whole or in part, without notice to or consent by Guarantor
        (including, without limitation, participation). In addition to any greater
        or
        lesser limitation provided by law, Guarantor shall not assert against any
        assignee of Lender any claims or defenses Guarantor may have against Lender,
        except claims and defenses, if any, arising under this Guaranty.

       

      14.  COSTS,
        EXPENSES, AND FEES.
        Guarantor shall promptly pay to Lender, upon demand, with interest thereon
        at
        the Default Interest Rate, reasonable attorneys’ fees and all costs and other
        expenses paid or incurred by Lender in enforcing or exercising its rights
        or
        remedies created by, connected with or provided for in this
        Guaranty.

       

      15.  SEVERABILITY.
        If any
        provision or any part of any provision of this Guaranty is unenforceable,
        the
        enforceability of the other provisions or the other provisions and the remainder
        of the subject provision, respectively, shall not be affected and they shall
        remain in full force and effect.

       

      16.  CHOICE
        OF LAW.
        THIS
        GUARANTY AND THE TRANSACTIONS CONTEMPLATED HEREUNDER SHALL BE GOVERNED BY
        AND
        CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF UTAH WITHOUT GIVING
        EFFECT
        TO CONFLICT OF LAWS PRINCIPLES. THE PARTIES AGREE THAT ALL ACTIONS OR
        PROCEEDINGS ARISING IN CONNECTION WITH THIS GUARANTY AND THE OTHER GUARANTOR
        LOAN DOCUMENTS MAY BE TRIED AND LITIGATED IN THE STATE AND FEDERAL COURTS
        LOCATED IN THE COUNTY OF SALT LAKE, STATE OF UTAH OR, IN ANY OTHER COURT
        IN
        WHICH A PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS
        SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF GUARANTOR,
        AND BY ACCEPTANCE HEREOF, LENDER WAIVES, TO THE EXTENT PERMITTED UNDER
        APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
        CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT
        IN ANY
        STATE OR FEDERAL COURT LOCATED IN THE COUNTY OF SALT LAKE, STATE OF
        UTAH.

       

      17.  TIME
        OF THE ESSENCE.
        Time is
        of the essence with regard to each provision of this Guaranty as to which
        time
        is a factor.

       

      18.  NOTICES
        AND DEMANDS.
        All
        notices, requests, demands and consents to be made hereunder to the parties
        hereto shall be in writing and shall be delivered by hand or sent by registered
        mail or certified mail, postage prepaid, return receipt requested (except
        for
        any notice address which is a post office box, in which case notice may be
        given
        by first class mail), through the United States Postal Service to the addresses
        shown below, or such other address which the parties may provide to one another
        in accordance herewith. Such notices, requests, demands and consents, if
        sent by
        mail, shall be deemed given two (2) Business Days after deposit in the United
        States mail, and if delivered by hand, shall be deemed given when
        delivered.

       

      To
        Lender:         JPMorgan
        Chase Bank, N.A.

      80
        West
        Broadway, Suite 200

      Salt
        Lake
        City, Utah 84101

      Attn:
        Paul Sommer

       

      with
        a
        copy to:    Snell
        & Wilmer L.L.P.

      Gateway
        Tower West

      15
        West
        South Temple, Suite 1200

      Salt
        Lake
        City, Utah 84101

      Attn:
        Brian D. Cunningham, Esq.

       

      To
        Guarantor:        c/o
        Franklin Covey Co.

      2200
        West
        Parkway Blvd.

      Salt
        Lake
        City, Utah 84110

      Attn:
        Richard Putnam

       

      with
        a
        copy to:    Dorsey
        & Whitney LLP

      170
        South
        Main Street, Suite 900

      Salt
        Lake
        City, Utah 84101

      Attn:
        Nolan S. Taylor, Esq.

      


      19.  JOINT
        AND SEVERAL OBLIGATIONS.
        This
        Guaranty may be executed by more than one person, and in such event the
        obligations hereunder shall be the joint and several obligations of each
        such
        person. Each reference to Guarantor shall be a reference to each person
        executing this Guaranty individually and to all such persons collectively.
        Each
        Guarantor’s liability is independent of the obligations of the other Guarantors.
        Lender may bring an action against any Guarantor to enforce this Guaranty,
        whether an action is brought against the other Guarantors.

       

      20.  PARTIAL
        PERFORMANCE.
        Guarantor’s performance of a portion, but not all, of the Obligations shall in
        no way limit, affect, modify or abridge Guarantor’s liability for the
        Obligations which are not performed. Without in any way limiting the generality
        of the foregoing, in the event that Lender is awarded a judgment in any suit
        brought to enforce Guarantor’s covenant to perform a portion of the Obligations,
        such judgment shall in no way be deemed to release Guarantor from its covenant
        to perform any portion of the Obligations which is not the subject of the
        suit.

       

      21.  INDEMNIFICATION
        OF LENDER. TO
        THE
        FULLEST EXTENT PERMITTED BY LAW, GUARANTOR AGREES TO PROTECT, INDEMNIFY,
        DEFEND
        AND SAVE HARMLESS LENDER, ITS DIRECTORS, OFFICERS, AGENTS, ATTORNEYS, AND
        EMPLOYEES FOR, FROM, AND AGAINST ANY AND ALL LIABILITY, EXPENSE, OR DAMAGE
        OF
        ANY KIND OR NATURE AND FOR, FROM, AND AGAINST ANY SUITS, CLAIMS, OR DEMANDS,
        INCLUDING REASONABLE ATTORNEY’S FEES AND EXPENSES ON ACCOUNT OF ANY MATTER OR
        THING OR ACTION, WHETHER IN SUIT OR NOT, ARISING OUT OF THIS GUARANTY, OR
        IN
        CONNECTION HEREWITH, EXCLUDING HOWEVER, ANY MATTERS ARISING OUT OF AN
        INDEMNIFIED PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OR ANY MATTERS
        ARISING AFTER LENDER HAS TAKEN TITLE TO OR POSSESSION OF THE COLLATERAL PLEDGED
        BY ANY GUARANTOR DOCUMENT. Upon receiving knowledge of any suit, claim, or
        demand asserted by a third party that Lender believes is covered by this
        indemnity, Lender shall give Guarantor notice of the matter and an opportunity
        to defend it, at Guarantor's sole cost and expense, with legal counsel
        satisfactory to Lender. Lender may also require Guarantor to so defend the
        matter. The obligations on the part of Guarantor under this Section
        21
        shall
        survive the payment and performance of the Obligations.

       

      22.  RESCISSION
        OR RETURN OF PAYMENTS.
        If at
        any time or from time to time, whether before or after payment and performance
        of the Obligations in full, all or any part of any amount received by Lender
        in
        payment of, or on account of, any Obligation is or must be, or is claimed
        to be,
        avoided, rescinded, or returned by Lender to Guarantor or any other person
        for
        any reason whatsoever (including, without limitation, bankruptcy, insolvency,
        or
        reorganization of Guarantor or any other person), such Obligation and any
        liens
        and encumbrances that secured such Obligation at the time such avoided,
        rescinded, or returned payment was received by Lender shall be deemed to
        have
        continued in existence or shall be reinstated, as the case may be, all as
        though
        such payment had not been received.

       

      23.  COUNTERPART
        EXECUTION.
        This
        Guaranty may be executed in one or more counterparts, each of which will
        be
        deemed an original and all of which together will constitute one and the
        same
        document. Signature pages may be detached from the counterparts and attached
        to
        a single copy of this Guaranty to physically form one document. Facsimile
        signature pages will be acceptable, provided originally signed signature
        pages
        are provided to each of the other parties by overnight courier.

       

      24.  RIGHT
        OF SET-OFF.
        In
        addition to any other rights and remedies of Lender, upon the occurrence
        of an
        Event of Default, including the failure of Guarantor to timely perform any
        obligation hereunder, Lender is authorized at any time and from time to time
        during the continuance of such default or Event of Default, without prior
        notice
        to Guarantor (any such notice being waived by Guarantor to the fullest extent
        permitted by law) to set-off and apply any and all deposits or deposit accounts
        (general or special, time or demand, provisional or final) at any time held
        by
        Lender to or for the credit or the account of Guarantor against any and all
        obligations of Guarantor under the Loan Documents, now or hereafter existing,
        irrespective of whether or not Lender shall have made demand under this Guaranty
        or any other Loan Document and although such amounts owed may be contingent
        or
        unmatured.

       

      [Remainder
        of Page Intentionally Left Blank]

       

       

      
        
          
          

        

        
          
          

          
          

        

        
          
          

        

      


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

       

      
        	 	 	 
	 	FRANKLIN
                COVEY PRINTING, INC.
	 
 	 
 	a
                Utah
                corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                
Name:
                Richard Putnam
	 	Title:
                Treasurer


      

       

       

      
        
          	 	 	 
	 	FRANKLIN
                  DEVELOPMENT CORPORATION
	 
 	 
 	a
                  Utah
                  corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                  
Name:
                  Richard Putnam
	 	Title:
                  Vice President


        

         

        
           

          
            	 	 	 
	 	FRANKLIN
                    COVEY TRAVEL, INC.
	 
 	 
 	a
                    Utah
                    corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                    
Name:
                    Richard Putnam
	 	Title:
                    Treasurer


          

           

           

          
            
              
                	 	 	 
	 	FRANKLIN
                        COVEY CATALOG SALES, INC.
	 
 	 
 	a
                        Utah
                        corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                        
Name:
                        Richard Putnam
	 	Title:
                        Treasurer


              

               

               

              
                
                  	 	 	 
	 	FRANKLIN
                          COVEY CLIENT SALES, INC.
	 
 	 
 	a
                          Utah
                          corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                          
Name:
                          Richard Putnam
	 	Title:
                          Treasurer


                

                 

                
                   

                  
                    	 	 	 
	 	FRANKLIN
                            COVEY PRODUCT SALES, INC.
	 
 	 
 	a
                            Utah
                            corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                            
Name:
                            Richard Putnam
	 	Title:
                            Treasurer


                  

                   

                   

                  
                     

                    
                      	 	 	 
	 	FRANKLIN
                              COVEY SERVICES, L.L.C.
	 
 	 
 	a
                              Utah limited liability company
 
	
                               By:  

                            	FRANKLIN
                              COVEY CLIENT
                              SALES, INC. 
	 	 	
                              a Utah corporation, its member

                               

                            
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                              
Name:
                              Richard Putnam
	 	Title:
                              Treasurer


                    

                     

                     

                    
                       

                      
                        	 	 	 
	
                                 By:  
                                  

                              	FRANKLIN
                                DEVELOPMENT CORPORATION
	 
 	 
 	a
                                Utah
                                corporation
 
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                                
Name:
                                Richard Putnam
	 	Title:
                                Vice President


                      

                       

                       

                      
                         

                        
                          	 	 	 
	 	FRANKLIN
                                  COVEY MARKETING, LTD.
	 
 	 
 	a
                                  Utah limited partnership
 
	
                                   By:  

                                	FRANKLIN
                                  COVEY DEVELOPMENT
                                  CORPORATION 
	 	 	
                                  a Utah corporation, its general
                                    partner

                                   

                                
	 	By:  	 /s/ RICHARD PUTNAM
	 	
                                  
Name:
                                  Richard Putnam
	 	
                                  Title:
                                    Vice President

                                  "Guarantor"