Exhibit 4.19


 


AMENDED AND RESTATED


GUARANTY AND SECURITY AGREEMENT


 


November 7, 2001


 


Congress
Financial Corporation (Western)


251
South Lake Avenue, Suite 900


Pasadena,
California 91101


 


	
  Re:

  	
  Geologistics Americas
  Inc., Matrix International Services, Inc. (formerly GeoLogistics Services,
  Inc.), Air Freight Consolidators International, Inc. and LEP Fairs Inc.

  



 


Ladies
and Gentlemen:


 


The undersigned (“Guarantor”) has previously
executed that certain Guarantee and Security Agreement, dated March 23, 2000
(the “Original Guaranty”), in favor of Congress Financial Corporation
(Western) (“Lender”), pursuant to which Guarantor has guaranteed the
payment of all obligations of Geologistics Americas Inc. (“GLA”), Matrix
International Logistics, Inc. (“MIL”), Bekins Worldwide Solutions, Inc.
(“BWS”) and Bekins Van Lines, LLC (“BVL”, and together with GLA, MIL and BWS, the “Original
Borrower”) to Lender arising under or in connection with that certain Loan
and Security Agreement, dated March 23, 2000, among the Original Borrowers and
Lender (as amended through the date hereof, the “Original Loan Agreement”),
which guaranty is secured by a grant of security interest in all of Guarantor’s
personal property as set forth therein as well as a pledge of the stock of LIW
Holding Corp., a Delaware corporation, made by Guarantor in favor of Lender
pursuant to that certain Stock Pledge Agreement, dated March 23, 2000 (the “Stock
Pledge”).


 


BVL, BWS and Lender are parties to an Amended and
Restated Loan and Security Agreement, of even date herewith (the “BVL/BWS
Loan Agreement”), pursuant to which, among other things, Lender will
continue to make loans and provide other financial accommodations to BVL and
BWS.


 


GLA, MIL, Air Freight
Consolidators International, Inc. and LEP Fairs Inc. (collectively, “Borrower”)
and Lender are parties to an Amended and Restated Loan and Security Agreement,
of even date herewith (as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced, the “Loan
Agreement”), pursuant to which, among other things, Lender will make, or
continue to make, as the case may be, loans and provide other financial
accommodations to Borrower, and other agreements, documents and instruments
referred to therein or at any time executed and/or delivered in connection
therewith or related thereto (except for the BVL/BWS Loan Agreement and any
documents or agreements specifically related thereto), including, but not
limited to, this Amended and Restated Guaranty and Security Agreement (this “Agreement”)
and the Stock Pledge (all of the foregoing, together with the Loan Agreement,
as the same now exist or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced, being collectively referred to herein as


 





















 


the
“Financing Agreements”).


 


Lender and Guarantor now wish to amend and restate
the terms of the Original Guaranty under the terms and conditions contained in
this Agreement.


 


1.                       Definitions. As used herein the following terms shall have the meanings stated
(all terms used herein related to the attachment, perfection, priority or
enforcement of the security interests granted hereby which are defined in
Division 1 or Division 9 of the UCC shall have the meanings given therein
unless otherwise defined in this Agreement).


 


(a)                   “Accounts” shall mean all present and
future rights of Guarantor to payment of a monetary obligation, whether or not
earned by performance, which are not evidenced by chattel paper or an
instrument, (a) for property that has been or is to be sold, leased, licensed,
assigned or otherwise disposed of, (b) for services rendered or to be rendered,
(c) for a secondary obligation incurred or to be incurred or (d) arising out of
the use of a credit, charge or debit card along with all information contained
on of for use with such card.


 


(b)                  “Collateral” shall have the meaning
set forth in Section 3 hereof.


 


(c)                   “Collateral Access Agreement” shall
mean an agreement in writing, in form and substance satisfactory to Lender,
from any lessor of premises to Guarantor, or any other person to whom any
Collateral (including Inventory, Equipment, bills of lading or other documents
of title) is consigned or who has custody, control or possession of any such
Collateral is located, pursuant to which such lessor, consignee or other
person, inter alia, acknowledges the first priority security interest of Lender
in such Collateral, agrees to waive any and all claims such lessor, consignee
or other person may, at any time, have against such Collateral, whether for
processing, storage or otherwise, and agrees to permit Lender access to, and
the right to remain on, the premises of such lessor, consignee or other person
so as to exercise Lender’s rights and remedies and otherwise deal with such
Collateral and, in the case of any consignee or other person who at any time
has custody, control or possession of any Collateral, acknowledges that it
holds and will hold possession of the Collateral for the benefit of Lender and
agrees to follow all instructions of Lender with respect thereto.


 


(d)                  “Default” shall mean an act, condition
or event which with notice or passage of time or both would constitute an Event
of Default.


 


(e)                   “Deposit Account Control Agreement” shall
mean an agreement in writing, in form and substance satisfactory to Lender, by
and among Lender, Guarantor and any bank at which any deposit account of
Guarantor is at any time maintained which provides that such bank will comply
with instructions originated by Lender directing disposition of the funds in
the deposit account without further consent by Guarantor and such other terms
and conditions as Lender may require.


 


(f)                     “Equipment” shall mean all of
Guarantor’s now owned and hereafter acquired equipment, wherever located,
including machinery, data processing and computer equipment and computer
hardware and software, whether owned or licensed, and including embedded
software, vehicles, tools, furniture, fixtures, all attachments, accessions and
property


 


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now
or hereafter affixed thereto or used in connection therewith, and substitutions
and replacements thereof, wherever located.


 


(g)                  “Event of Default” and “Events of
Default” shall have the meanings set forth in Section 10(a) hereof.


 


(h)                  “GAAP” shall mean generally accepted
accounting principles in the United States of America as in effect from time to
time as set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
the statements and pronouncements of the Financial Accounting Standards Boards
which are applicable to the circumstances as of the date of determination
consistently applied.


 


(i)                      “Governmental Authority” shall mean
any nation or government, any state, province, or other political subdivision
thereof, any central bank (or similar monetary or regulatory authority)
thereof, any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, and any corporation or
other entity owned or controlled, through stock or capital ownership or
otherwise, by any of the foregoing.


 


(j)                      “Information Certificate” shall mean the
Information Certificate of Guarantor constituting Exhibit A hereto
containing material information with respect to Guarantor, its business and
assets provided by or on behalf of Guarantor to Lender in connection with the
preparation of this Agreement and the other Financing Agreements and the
financing arrangements provided for herein.


 


(k)                   “Intellectual Property” shall mean all
of Guarantor’s now owned and hereafter arising or acquired: patents, patent
rights, patent applications, copyrights, works which are the subject matter of
copyrights, copyright registrations, trademarks, trade names, trade styles,
trademark and service mark applications, and licenses and rights to use any of
the foregoing; all extensions, renewals, reissues, divisions, continuations,
and continuations-in-part of any of the foregoing; all rights to sue for past,
present and future infringement of any of the foregoing; inventions, trade
secrets, formulae, processes, compounds, drawings, designs, blueprints,
surveys, reports, manuals, and operating standards; goodwill (including any
goodwill associated with any trademark or the license of any trademark);
customer and other lists in whatever form maintained; and trade secret rights,
copyright rights, rights in works of authorship, domain names and domain name
registrations; software and contract rights relating to software, in whatever
form created or maintained.


 


(1)                   “Inventory” shall mean all of
Guarantor’s now owned and hereafter existing or acquired goods, whenever
located, which (a) art leased by Guarantor as lessor, (b) are held by Guarantor
for sale or lease or to be furnished under a contract of service, (c) are
furnished by Guarantor under a contract of service or (d) consist of raw
materials, work in process, finished goods or materials used or consumed in its
business.


 


(m)                “Investment Property Control Agreement”
shall mean an agreement in writing, in form and substance satisfactory to
Lender, by and among Lender, Guarantor and any securities intermediary,
commodity intermediary or other person who has custody, control or


 


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possession
of any investment property of Guarantor acknowledging that such securities
intermediary, commodity intermediary or other person has custody, control or
possession of such investment property on behalf of Lender, that it will comply
with entitlement orders originated by Lender with respect to such investment
property, or other instructions of Lender, or (as the case may be) apply any
value distributed on account of any commodity contract as directed by Lender,
in each case, without the further consent of Guarantor and including such other
terms and conditions as Lender may require.


 


(n)                  “Obligor” and “Obligors” shall
have the meanings set forth in Section 4(a) hereof.


 


(o)                  “Receivables” shall mean all of the
following now owned or hereafter arising or acquired property of Guarantor: (a)
all Accounts; (b) all interest, fees, late charges, penalties, collection fees
and other amounts due or to become due or otherwise payable in connection with
any Account; and (c) all payment intangibles of Guarantor and other contract
rights, chattel paper, instruments, notes, and other forms of obligations owing
to Guarantor, whether from the sale and lease of goods or other property,
licensing of any property (including Intellectual Property or other general intangibles),
rendition of services or from loans or advances by Guarantor or to or for the
benefit of any third person (including loans or advances to any affiliates or
subsidiaries of Guarantor) or otherwise associated with any Accounts, Inventory
or general intangibles of Guarantor (including, without limitation, choses in
action, causes of action, tax refunds, tax refund claims, any funds which may
become payable to Guarantor in connection with the termination of any employee
benefit plan and any other amounts payable to Guarantor from any employee
benefit plan, rights and claims against carriers and shippers, rights to
indemnification, business interruption insurance and proceeds thereof, casualty
or any similar types of insurance and any proceeds thereof and proceeds of
insurance covering the lives of employees on which Guarantor is a beneficiary).


 


(p)                  “Records” shall mean all of Guarantor’s
present and future books of account of every kind or nature, purchase and sale
agreements, invoices, ledger cards, bills of lading and other shipping
evidence, statements, correspondence, memoranda, credit files and other data
relating to the Collateral or any account debtor, together with the tapes,
disks, diskettes and other data and software storage media and devices, file
cabinets or containers in or on which the foregoing are stored (including any
rights of Guarantor with respect to the foregoing maintained with or by any
other person).


 


(q)                  “UCC” shall mean the Uniform
Commercial Code as in effect in the State of California, and any successor
statute, as in effect from time to time (except that terms used herein which
are defined in the Uniform Commercial Code as in effect in the State of
California on the date hereof shall continue to have the same meaning notwithstanding
any replacement or amendment of such statute except as Lender may otherwise
determine.


 


2.                       Guaranty.


 


(a)                   Guarantor absolutely and unconditionally
guarantees and agrees to be liable for the full and indefeasible payment and
performance when due of the following (all of which are collectively referred
to herein as the “Guaranteed Obligations”): (i) all obligations,


 


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liabilities
and indebtedness of any kind, nature and description of Borrower to Lender
and/or its affiliates, including principal, interest, charges, fees, costs and
expenses, however evidenced, whether as principal, surety, endorser, guarantor
or otherwise, whether arising under or in connection with the Loan Agreement
and the other Financing Agreements, whether now existing or hereafter arising,
whether arising before, during or after the initial or any renewal term of the
Loan Agreement or after the commencement of any case with respect to Borrower
under the United States Bankruptcy Code or any similar statute (including,
without limitation, the payment of interest and other amounts, which would
accrue and become due but for the commencement of such case, whether or not
such amounts are allowed or allowable in whole or in part in any such case and
including loans, interest, fees, charges and expenses related thereto and all
other obligations of Borrower or its successors to Lender arising after the
commencement of such case), whether direct or indirect, absolute or contingent,
joint or several, due or not due, primary or secondary, liquidated or
unliquidated, secured or unsecured, and however acquired by Lender and (ii) all
reasonable expenses (including, without limitation, reasonable attorneys’ fees
and legal expenses) incurred by Lender in connection with the preparation,
execution, delivery, recording, administration, collection, liquidation,
enforcement and defense of Borrower’s obligations, liabilities and indebtedness
as aforesaid to Lender, the rights of Lender in any collateral or under this
Agreement and all other Financing Agreements or in any way involving claims by
or against Lender directly or indirectly arising out of or related to the
relationships between Borrower, Guarantor or any other Obligor and Lender,
whether such expenses are incurred before, during or after the initial or any
renewal term of the Loan Agreement and the other Financing Agreements or after
the commencement of any case with respect to Borrower or Guarantor under the
United States Bankruptcy Code or any similar statute.


 


(b)                  This Agreement is a guaranty of payment and
not of collection. Guarantor agrees that Lender need not attempt to collect any
Guaranteed Obligations from Borrower, Guarantor or any other Obligor or to
realize upon any collateral, but may require Guarantor to make immediate
payment of all of the Guaranteed Obligations to Lender when due, whether by maturity,
acceleration or otherwise, or at any time thereafter. Lender may apply any
amounts received in respect of the Guaranteed Obligations to any of the
Guaranteed Obligations, in whole or in part (including attorneys’ fees and
legal expenses incurred by Lender with respect thereto or otherwise chargeable
to Borrower or Guarantor) and in such order as Lender may elect.


 


(c)                   Payment by Guarantor shall be made to Lender
at the office of Lender from time to time on demand as Guaranteed Obligations
become due. Guarantor shall make all payments to Lender on the Guaranteed
Obligations free and clear of, and without deduction or withholding for or on
account of, any setoff, counterclaim, defense, duties, taxes, levies, imposts, fees,
deductions, withholding, restrictions or conditions of any kind. One or more
successive or concurrent actions may be brought hereon against Guarantor either
in the same action in which Borrower or any other Obligor is sued or in
separate actions. In the event any claim or action, or action on any judgment,
based on this Agreement is brought against Guarantor, Guarantor agrees not to
deduct, set-off, or seek any counterclaim for or recoup any amounts which are
or may be owed by Lender to Guarantor.


 


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3.                       Grant and Perfection of Security Interest.


 


(a)                   Grant of Security Interest. To secure payment and performance of the
Guaranteed Obligations, Guarantor hereby grants to Lender a continuing security
interest in, a lien upon, and a right of set off against, and
hereby assigns to Lender as security, all of its personal property and
interests in property, whether now owned or hereafter acquired or existing, and
wherever located (together with all other collateral security for the
Guaranteed Obligations at any time granted to or held or acquired by Lender,
the “Collateral”), including:


 


(i)                              all Accounts;


 


(ii)                           all general intangibles, including, without
limitation, all Intellectual Property and all accounts owed to Guarantor by any
of its Affiliates;


 


(iii)                        all Inventory and Equipment (collectively, “Goods”);


 


(iv)                       all chattel paper (including all tangible and
electronic chattel paper);


 


(v)                          all instruments (including all promissory
notes);


 


(vi)                       all documents;


 


(vii)                    all deposit accounts;


 


(viii)                 all letters of credit, banker’s acceptances
and similar instruments and including all letter-of-credit rights;


 


(ix)                         all supporting obligations and all present
and future liens, security interests, rights remedies, title and interest in,
to and in respect of Receivables and other Collateral, including: (A) rights
and remedies under or relating to guaranties, contracts of suretyship, letters of
credit and credit and other insurance related to the Collateral, (B) rights of
stoppage in transit, replevin, repossession, reclamation and other rights and
remedies of an unpaid vendor, lienor or secured party, (C) goods described in
invoices, documents, contracts or instruments with respect to, or otherwise
representing or evidencing. Receivables or other Collateral, including,
returned, repossessed and reclaimed goods, and (D) deposits by and property of
account debtors or other persons securing the obligations of account debtors;


 


(x)                            all (A) investment property (including
securities, whether certificated
or uncertificated, securities accounts, security entitlements, commodity
contracts or commodity accounts) and (B) monies, credit balances, deposits and
other property of Guarantor now or hereafter held or received by or in transit
to Lender or its affiliates or at any other depository or other institution
from or for the account of Guarantor, whether for safekeeping, pledge, custody,
transmission, collection or otherwise;


 


(xi)                         to the extent not otherwise described above,
all Receivables;


 


(xii)                      all Records; and


 


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(xiii)                   all products and proceeds of the foregoing,
in any form, including insurance proceeds and all claims against third parties
for loss or damage to or destruction of or other involuntary conversion of any
kind or nature of any or all of the Collateral.


 


(b)                  Perfection of Security Interest.


 


(i)                              Guarantor irrevocably and unconditionally
authorizes Lender (or its agent) to file at any time and from time to time such
financing statements with respect to the Collateral naming Lender or its
designee as the secured party and Guarantor as debtor, as Lender may require,
and including any other information with respect to Guarantor or otherwise
required by part 5 of Article 9 of the Uniform Commercial Code of such
jurisdiction as Lender may determine, together with any amendment and
continuations with respect thereto, which authorization shall apply to all
financing statements filed on, prior to or after the date hereof. Guarantor
hereby ratifies and approves all financing statements naming Lender or its
designee as secured party and Guarantor as debtor with respect to the
Collateral (and any amendments with respect to such financing statements) filed
by or on behalf of Lender prior to the date hereof and ratifies and confirms
the authorization of Lender to file such financing statements (and amendments,
if any). Guarantor hereby authorizes Lender to adopt on behalf of Guarantor any
symbol required for authenticating any electronic filing. In the event that the
description of the collateral in any financing statement naming Lender or its
designee as the secured party and Guarantor as debtor includes assets and
properties of Guarantor that do not at any time constitute Collateral, whether
hereunder, under any of the Financing Agreements or otherwise, the filing of
such financing statement shall nonetheless be deemed authorized by Guarantor to
the extent of the Collateral included in such description and it shall not
render the financing statement ineffective as to any of the Collateral or
otherwise affect the financing statement as it applies to any of the
Collateral. In no event shall Guarantor at any time file, or permit or cause to
be filed, any correction statement or termination statement with respect to any
financing statement (or amendment or continuation with respect thereto) naming
Lender or its designee as secured party and Guarantor as debtor.


 


(ii)                           Guarantor has no chattel paper (whether
tangible or electronic) or instruments as of the date hereof, except as set
forth in Schedule 3(b)(ii) hereto. In the event that Guarantor shall be
entitled to or shall receive any chattel paper or instrument after the date
hereof other than the type described in Schedule 3(b)(ii) hereto, Guarantor
shall promptly notify Lender thereof in writing. Promptly upon the receipt
thereof by or on behalf of Guarantor (including by any agent or
representative), Guarantor shall deliver, or cause to be delivered to Lender,
all such tangible chattel paper and instruments that Guarantor may at any time
acquire, accompanied by such instruments of transfer or assignment duly
executed in blank as Lender may from time to time specify, in each case except
as Lender may otherwise agree. At Lender’s option, Guarantor shall, or Lender
may at any time on behalf of Guarantor, cause the original of any such
instrument or chattel paper to be conspicuously marked in a form and manner
acceptable to Lender with the following legend referring to chattel paper or
instruments as applicable: “This [chattel paper] [instrument] is subject to the
security interest of Congress Financial Corporation (Western) and any sale,
transfer, assignment or encumbrance of this [chattel paper] [instrument]
violates the rights of such secured party.”


 


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(iii)                        In the event that Guarantor shall at any time
hold or acquire an interest in any electronic chattel paper or any “transferable
record” (as such term is defined in Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act or in Section 16 of the Uniform
Electronic Transactions Act as in effect in any relevant jurisdiction),
Guarantor shall promptly notify Lender thereof in writing. Promptly upon Lender’s
request, Guarantor shall take, or cause to be taken, such actions as Lender may
reasonably request to give Lender control of such electronic chattel paper
under Section 9-105 of the UCC and control of such transferable record under
Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or, as the case may be, Section 16 of the Uniform Electronic
Transactions Act, as in effect in such jurisdiction.


 


(iv)                       Guarantor has no deposit accounts as of the
date hereof, except as set forth in the Information Certificate. Guarantor
shall not, directly or indirectly, after the date hereof open, establish or
maintain any deposit account unless each of the following conditions is satisfied:
(i) Lender shall have received not less than five (5) Business Days’ prior
written notice of the intention of Guarantor to open or establish such account
which notice shall specify in reasonable detail and specificity
acceptable to Lender the name of the account, the owner of the account, the
name and address of the bank at which such account is to be opened or
established, the individual at such bank with whom Guarantor is dealing and the
purpose of the account, (ii) the bank where such account is opened or
maintained shall be acceptable to Lender, and (iii) on or before the opening of
such deposit account, Guarantor shall as Lender may specify either (A) deliver
to Lender a Deposit Account Control Agreement with respect to such deposit
account duly authorized, executed and delivered by Guarantor and the bank at
which such deposit account is opened and maintained or (B) arrange for Lender
to become the customer of the bank with respect to the deposit account on terms
and conditions acceptable to Lender. The terms of this Section 3(b)(iv) shall
not apply to deposit accounts (I) in existence as of the date hereof or (II)
specifically and exclusively (a) used for payroll, payroll taxes and other
employee wage and benefit payments to or for the benefit of Guarantor’s
salaried employees or (b) containing funds received on or about the date hereof
by Guarantor from the sale of its stock to funds managed by Questor Management
Company, LLC.


 


(v)                          Guarantor does not own or hold, directly or
indirectly, beneficially or as record owner or both, any investment property,
as of the date hereof, or have any investment account, securities account,
commodity account or other similar account with any bank or other financial
institution or other securities intermediary or commodity intermediary as of
the date hereof, in each case except as set forth in the Information
Certificate.


 


(vi)                       Except as set forth in Schedule 3(b)(iv),
Guarantor is not the beneficiary
of, or is otherwise directly entitled to any right to payment under any letter
of credit, banker’s acceptance or similar instrument as of the date hereof. In
the event that Guarantor shall be entitled to or shall receive any direct right
to payment under any letter of credit, banker’s acceptance or any similar
instrument, whether as beneficiary thereof or otherwise after the date hereof,
Guarantor shall promptly notify Lender thereof in writing. Guarantor shall
immediately, as Lender may specify, either (A) deliver, or cause to be
delivered to Lender, with respect to any such letter of credit, banker’s
acceptance or similar instrument, the written agreement of the issuer and any
other nominated person obligated to make any payment in respect thereof
(including any confirming or negotiating bank), in form and substance satisfactory
to Lender,


 


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consenting
to the assignment of the proceeds of the letter of credit to Lender by
Guarantor and agreeing to make all payments thereon directly to Lender or as
Lender may otherwise direct or (B) cause Lender to become, at Guarantor’s
expense, the transferee beneficiary of the letter of credit, banker’s
acceptance or similar instrument (as the case may be).


 


(vii)                    As of the date hereof, Guarantor has no
commercial tort claims in which the amount claimed by the Guarantor is in
excess of Two Hundred Fifty Thousand Dollars ($250,000). In the event that
Guarantor shall at any time after the date hereof have any commercial tort
claims in which the amount claimed by the Guarantor is in excess of Two Hundred
Fifty Thousand Dollars ($250,000), Guarantor shall promptly notify Lender
thereof in writing, which notice shall (A) set forth in reasonable detail the
basis for and nature of such commercial tort claim and (B) include the express
grant by Guarantor to Lender of a security interest in such commercial tort
claim (and the proceeds thereof). In the event that such notice does not
include such grant of a security interest, the sending thereof by Guarantor to
Lender shall be deemed to constitute such grant to Lender. Upon the sending of
such notice, any commercial tort claim described therein shall constitute part
of the Collateral and shall be deemed included therein. Without limiting the
authorization of Lender provided in Section 3(b) hereof or otherwise arising by
the execution Guarantor of this Agreement or any of the other Financing
Agreements, Lender is hereby irrevocably authorized from time to time and at
any time to file such financing statements naming Lender or its designee as
secured party and Guarantor as debtor, or any amendments to any financing
statements, covering any such commercial tort claim as Collateral. In addition,
Guarantor shall promptly upon Lender’s request, execute and deliver, or cause
to be executed and delivered, to Lender such other agreements, documents and
instruments as Lender may require in connection with such commercial tort
claim.


 


(viii)                 Guarantor does not have any Goods, documents
of title or other Collateral in the custody, control or possession of a third
party as of the date hereof, except as set forth in the Information Certificate
and except for Goods located in the United States in transit to a location of
Guarantor permitted herein in the ordinary course of Guarantor’s business in
the possession of the carrier transporting such Goods. In the event that any
Goods, documents of title or other Collateral are at any time after the date
hereof in the custody, control or possession of any other person not referred
to in the Information Certificate or such carriers, Guarantor shall promptly
notify Lender thereof in writing. Promptly upon Lender’s request, Guarantor
shall deliver to Lender a Collateral Access Agreement duly authorized, executed
and delivered by such person and Guarantor.


 


(ix)                         Guarantor shall take any other actions
reasonably requested by Lender from time to time to cause the attachment,
perfection and first priority of, and the ability of Lender to enforce, the
security interest of Lender in any and all of the Collateral, including,
without limitation, (A) executing, delivering and, where appropriate, filing
financing statements and amendments relating thereto under the UCC or other
applicable law, to the extent, if any, that Guarantor’s signature thereon is
required therefore, (B) causing Lender’s name to be noted as secured party on
any certificate of title for a titled good if such notation is a condition to
attachment, perfection or priority of, or ability of Lender to enforce, the
security interest of Lender in such Collateral, (C) complying with any
provision of any statute, regulation or treaty of the United States as to any
Collateral if compliance with such provision is a condition to


 


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attachment,
perfection or priority of, or ability of Lender to enforce, the security
interest of Lender in such Collateral, and (D) obtaining the consents and
approvals of any Governmental Authority or third party, including, without
limitation, any consent of any licensor, lessor or other person obligated on
Collateral, and taking all actions required by any earlier versions of the UCC
or by other law, as applicable in any relevant jurisdiction.


 


4.                       Waivers and Consents.


 


(a)                   Notice of acceptance of this Agreement, the
making of loans and advances and providing other financial accommodations to
Borrower and presentment, demand, protest, notice of protest, notice of
nonpayment or default and all other notices to which Borrower or Guarantor is
entitled are hereby waived by Guarantor. Guarantor also waives notice of and hereby
consents to (i) any amendment, modification, supplement, extension, renewal, or
restatement of the Loan Agreement and any of the other Financing Agreements,
including, without limitation, extensions of time of payment of or increase or
decrease in the amount of any of the Guaranteed Obligations, the interest rate,
fees, other charges, or any collateral, and the guarantee made herein shall
apply to the Loan Agreement and the other Financing Agreements and the
Guaranteed Obligations as so amended, modified, supplemented, renewed, restated
or extended, increased or decreased, (ii) the taking, exchange, surrender and
releasing of collateral or guarantees now or at any time held by or available
to Lender for the obligations of Borrower or any other party at any time liable
on or in respect of the Guaranteed Obligations or who is the owner of any
property which is security for the Guaranteed Obligations (individually, an “Obligor”
and collectively, the “Obligors”), (iii) the exercise of, or refraining
from the exercise of any rights against Borrower or any other Obligor or any
collateral, (iv) the settlement, compromise or release of, or the waiver of any
default with respect to, any of the Guaranteed Obligations and (v) any
financing by Lender of Borrower under Section 364 of the United States Bankruptcy
Code or consent to the use of cash collateral by Lender under Section 363 of
the United States Bankruptcy Code. Guarantor agrees that the amount of the
Guaranteed Obligations shall not be diminished and the liability of Guarantor
hereunder shall not be otherwise impaired or affected by any of the foregoing.


 


(b)                  No invalidity, irregularity or
unenforceability of all or any part of the Guaranteed Obligations shall affect,
impair or be a defense to this Agreement, nor shall any other circumstance
which might otherwise constitute a defense available to or legal or equitable discharge
of Borrower in respect of any of the Guaranteed Obligations, or Guarantor in
respect of this Agreement, affect, impair or be a defense to this Agreement.
Without limitation of the foregoing, the liability of Guarantor hereunder shall
not be discharged or impaired in any respect by reason of any failure by Lender
to perfect or continue perfection of any lien or security interest in any
collateral or any delay by Lender in perfecting any such lien or security
interest. As to interest, fees and expenses, whether arising before or after
the commencement of any case with respect to Borrower under the United States
Bankruptcy Code or any similar statute, Guarantor shall be liable therefor,
even if Borrower’s liability for such amounts does not, or ceases to, exist by
operation of law. Guarantor acknowledges that Lender has not made any representations
to Guarantor with respect to Borrower, any other Obligor or otherwise in connection
with the execution and delivery by Guarantor of this Agreement and Guarantor is
not in any respect relying upon Lender or any statements by Lender in
connection with this Agreement.


 


10





















 


(c)                   Until the indefeasible payment in full of the
Guaranteed Obligations, Guarantor hereby irrevocably and unconditionally waives
and relinquishes all statutory, contractual, common law, equitable and all
other claims against Borrower, any collateral for the Guaranteed Obligations or
other assets of Borrower or any other Obligor, for subrogation, reimbursement,
exoneration, contribution, indemnification, setoff or other recourse in respect
to sums paid or payable to Lender by Guarantor hereunder and Guarantor hereby
further irrevocably and unconditionally waives and relinquishes any and all
other benefits which Guarantor might otherwise directly or indirectly receive
or be entitled to receive by reason of any amounts paid by or collected or due
from Guarantor, Borrower or any other Obligor upon the Guaranteed Obligations
or realized from their property.


 


(d)                  Without limiting the generality of any other
waiver or other provision set forth in this Agreement, in accordance with Section
2856 of the California Civil Code, Guarantor hereby irrevocably and
unconditionally waives all rights and defenses arising out of an election of
remedies by Lender, even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for a Guaranteed Obligation,
has destroyed Guarantor’s rights of subrogation and reimbursement against
Borrower by operation of Section 580d of the California Code of Civil Procedure
or otherwise.


 


(e)                   Without limiting the generality of any other
waiver or other provision set forth in this Agreement, in accordance with
Section 2856 of the California Civil Code, Guarantor waives all rights and
defenses that Guarantor may have because the Guaranteed Obligations are secured
by real property. This means, among other things: (i) Lender may collect from Guarantor
without first foreclosing on any real or personal property collateral pledged
by Borrower, and (ii) if Lender forecloses on any real property collateral
pledged by Borrower: (A) the amount of the Guaranteed Obligations may be
reduced only by the price for which that collateral is sold at the foreclosure
sale, even if the collateral is worth more than the sale price and (B) the
Lender may collect from Guarantor even if Lender, by foreclosing on the real property
collateral, has destroyed any right Guarantor may have to collect from
Borrower. This is an unconditional and irrevocable waiver of any rights and
defenses Guarantor may have because the Guaranteed Obligations are secured by
real property. These rights and defenses include, but are not limited to, any
rights or defenses based upon Sections 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure.


 


(f)                     Without limiting the generality of any other
waiver or other provision set forth in this Agreement, Guarantor hereby
irrevocably and unconditionally waives and relinquishes, to the maximum extent
such waiver or relinquishment is permitted by applicable law, any and all
rights, claims and defenses arising directly or indirectly under Sections 2787 through
2855, inclusive, of the California Civil Code and Sections 580a, 580b, 580c,
580d and 726 of the California Code of Civil Procedure or any similar laws of
any other jurisdiction.


 


5.                       Subordination. Payment of all amounts now or hereafter
owed to Guarantor by Borrower or any other Obligor is hereby subordinated in
right of payment to the indefeasible payment in full to Lender of the
Guaranteed Obligations and all such amounts and any security and guarantees
therefor are hereby assigned to Lender as security for the Guaranteed
Obligations.


 


11





















 


6.                       Acceleration. Notwithstanding anything to the contrary
contained herein or any of the terms of any of the other Financing Agreements,
the liability of Guarantor for the entire Guaranteed Obligations shall mature
and become immediately due and payable, even if the liability of Borrower or
any other Obligor therefor does not, upon the occurrence of any act, condition
or event which constitutes a Default or an Event of Default as defined below.


 


7.                       Account Stated. The books and records of Lender showing the
account between Lender and Borrower shall be admissible in evidence in any
action or proceeding against or involving Guarantor as prima  facie
proof of the items therein set forth, and the monthly statements of Lender
rendered to Borrower, to the extent to which no written objection is made within
thirty (30) days from the date of sending thereof to Borrower, shall be deemed conclusively
correct and constitute an account stated between Lender and Borrower and be binding
on Guarantor.


 


8.                       Representations and Warranties. Guarantor hereby represents and warrants to
Lender the following (which shall survive the execution and delivery of this
Agreement):


 


(a)                   Financial Statements; No Material Adverse
Change. All financial statements
relating to Guarantor and its direct or indirect subsidiaries which have been
or may hereafter be delivered by Guarantor or any of its subsidiaries to Lender
have been prepared in accordance with GAAP (except as to any interim financial
statements, to the extent such statements are subject to normal year-end
adjustments and do not include any notes) and fairly present in all material
respects the financial condition and the results of operations of Guarantor and
its subsidiaries as at the dates and for the periods set forth therein. Except
as disclosed in any interim financial statements so furnished, there has been
no material adverse change in the assets, liabilities, properties and
condition, financial or otherwise, of Guarantor or any of its subsidiaries,
since the date of the most recent audited financial statements so furnished.


 


(b)                  Name; State of Organization; Chief Executive
Office; Collateral Locations.


 


(i)                                   The exact legal name of Guarantor is as set
forth on the signature page of this Agreement and in the Information
Certificate. Guarantor has not, during the past five years, been known by or
used any other corporate or fictitious name or been a party to any merger or
consolidation, or acquired all or substantially all of the assets of any
person, or acquired any of its property or assets out of the ordinary course of
business, except as set forth in the Information Certificate.


 


(ii)                                Guarantor is an organization of the type, and
organized in the jurisdiction, set forth in the Information Certificate. The
Information Certificate accurately sets forth the organizational identification
number of Guarantor or accurately state that Guarantor has none and accurately
sets forth the federal employer identification number of Guarantor.


 


(iii)                              The chief executive office of Guarantor and
Guarantor’s Records concerning Accounts are located only at the address
identified as such in the Information Certificate and its only other places of
business and the only other locations of Collateral, if any, are the addresses
set forth in the Information Certificate, subject to the right of Guarantor to


 


12





















 


establish
new locations in accordance with Section 9(b) below. The Information
Certificate correctly identifies any of such locations which are not owned by
Guarantor and sets forth the owners and/or operators thereof.


 


(c)                   Accuracy and Completeness of Information. All information furnished by or on behalf
of Guarantor in writing to Lender in connection with this Agreement or any of
the other Financing Agreements or any transaction contemplated hereby or
thereby, including all information on all Schedules hereto, is true and correct
in all material respects on the date as of which such information is dated or
certified and does not omit any material fact necessary in order to make such
information not misleading. No event or circumstance has occurred which has had
or could reasonably be expected to have a material adverse affect on the
business, assets or condition (financial or other) of Guarantor, which has not
been fully and accurately disclosed to Lender in writing.


 


(d)                  Survival of Warranties; Cumulative. All representations and warranties contained
in this Agreement or any of the other Financing Agreements shall survive the execution
and delivery of this Agreement and shall be conclusively presumed to have been
relied on by Lender regardless of any investigation made or information
possessed by Lender. The representations and warranties set forth herein shall
be cumulative and in addition to any other representations or warranties which
Guarantor shall now or hereafter give, or cause to be given, to Lender.


 


9.                       Affirmative and Negative Covenants.


 


(a)                   Maintenance of Existence.


 


(i)                                   Guarantor shall at all times preserve, renew
and keep in full, force and effect its corporate existence and rights and
franchises with respect thereto and maintain in full force and effect all
permits, licenses, trademarks, tradenames, approvals and authorizations
necessary to carry on the business as presently or proposed to be conducted.


 


(ii)                                Guarantor shall not change its name unless
each of the following conditions is satisfied: (A) Lender shall have received
not less than thirty (30) days’ prior written notice from Guarantor of such
proposed change in its corporate name, which notice shall accurately set forth
the new name; and (B) Lender shall have received a copy of the amendment to the
articles or certificate of formation or incorporation, as the case may be, of
Guarantor providing for the name change certified by the Secretary of State of
the jurisdiction of incorporation or organization of Guarantor as soon as it is
available.


 


(iii)                             Guarantor shall not change its chief
executive office or its mailing address or organizational identification number
(or if it does not have one, shall not acquire one) unless Lender shall have
received not less than thirty (30) days’ prior written notice from Guarantor of
such proposed change, which notice shall set forth such information with
respect thereto as Lender may require and Lender shall have received such
agreements as Lender may reasonably require in connection therewith. Guarantor
shall not change its type of organization, jurisdiction of organization or
other legal structure.


 


13





















 


(b)                  New Collateral Locations. Guarantor may open any new location within
the continental United States provided Guarantor: (i) gives Lender thirty (30)
days prior written notice of the intended opening of any such new location; and
(ii) executes and delivers, or causes to be executed and delivered, to Lender
such agreements, documents, and instruments as Lender may deem reasonably
necessary or desirable to protect its interests in the Collateral at such
location.


 


(c)                   Costs and Expenses. Guarantor shall pay to Lender on demand all
reasonable costs, expenses, filing fees and taxes paid or payable in connection
with the preparation, negotiation, execution, delivery, recording,
administration, collection, liquidation, enforcement and defense of the
Guaranteed Obligations, Lender’s rights in the Collateral, this Agreement, the
other Financing Agreements and all other documents related hereto or thereto,
including any amendments, supplements or consents which may hereafter be
contemplated (whether or not executed) or entered into in respect hereof and
thereof, including:


 


(i)                              all costs and expenses of filing or recording
(including UCC financing statement filing taxes and fees, documentary taxes,
intangibles taxes and mortgage recording taxes and fees, if applicable);


 


(ii)                           all costs ad expenses and fees for insurance
premiums, environmental audits,
surveys, assessments, engineering reports ad inspections, appraisal fees and
search fees;


 


(iii)                        costs and expenses of preserving and
protecting the Collateral;


 


(iv)                       costs and expenses paid or incurred in
connection with obtaining payment of the Guaranteed Obligations, enforcing the
security interests and liens of Lender, selling or otherwise realizing upon the
Collateral, and otherwise enforcing the provisions of this Agreement and the
other Financing Agreements or defending any claims made or threatened against
Lender arising out of the transactions contemplated hereby and thereby
(including, without limitation, preparations for and consultations concerning
any such matters); and


 


(v)                            the fees and disbursements of counsel
(including legal assistants) to Lender in connection with any of the foregoing.


 


10.                 Events of Default and Remedies.


 


(a)                   Events of Default. The occurrence or existence of any Event of
Default under the Loan Agreement is referred to herein individually as an “Event
of Default”, and collectively as “Events of Default”.


 


(b)                  Remedies.


 


(i)                              At any time an Event of Default exists or has
occurred and is continuing, Lender shall have all rights and remedies provided
in this Agreement, the other Financing Agreements, the UCC and other applicable
law, all of which rights and remedies may be exercised without notice to or
consent by Guarantor or any Obligor, except as such notice or consent is
expressly provided for hereunder or required by applicable law. All rights,
remedies


 


14





















 


and
powers granted to Lender hereunder, under any of the other Financing
Agreements, the UCC or other applicable law, are cumulative, not exclusive and
enforceable, in Lender’s discretion, alternatively, successively, or
concurrently on any one or more occasions, and shall include, without
limitation, the right to apply to a court of equity for an injunction to
restrain a breach or threatened breach by Guarantor of this Agreement or any of
the other Financing Agreements. Lender may, at any time or times, proceed
directly against Guarantor to collect the Guaranteed Obligations without prior
recourse to any other Obligor or any of the Collateral.


 


(ii)                           Without limiting the foregoing, at any time
an Event of Default exists or has occurred and is continuing, Lender may, in
its discretion and without limitation: (A) accelerate the payment of all
Guaranteed Obligations and demand immediate payment thereof to Lender (provided
that, upon the occurrence of any Event of Default described in Sections 10.1(i)
and 10.1(j) of the Loan Agreement, all Guaranteed Obligations shall
automatically become immediately due and payable); (B) with or without judicial
process or the aid or assistance of others, enter upon any premises on or in
which any of the Collateral may be located and take possession of the Collateral
or complete processing, manufacturing and repair of all or any portion of the
Collateral; (C) require Guarantor, at Guarantor’s expense, to assemble and make
available to Lender any part or all of the Collateral at any place and time
designated by Lender; (D) collect, foreclose, receive, appropriate, setoff and
realize upon any and all Collateral; (E) remove any or all of the Collateral
from any premises on or in which the same may be located for the purpose of
effecting the sale, foreclosure or other disposition thereof or for any other
purpose; and (F) sell, lease, transfer, assign, deliver or otherwise dispose of
any and all Collateral (including entering into contracts with respect thereto,
public or private sales at any exchange, broker’s board, at any office of
Lender or elsewhere) at such prices or terms as Lender may deem reasonable, for
cash, upon credit or for future delivery, with the Lender having the right to
purchase the whole or any part of the Collateral at any such public sale, all of
the foregoing being free from any right or equity of redemption of Guarantor,
which right or equity of redemption is hereby expressly waived and released by
Guarantor. If any of the Collateral is sold or leased by Lender upon credit
terms or for future delivery, the Guaranteed Obligations shall not be reduced
as a result thereof until payment therefor is finally collected by Lender. If
notice of disposition of Collateral is required by law, five (5) days prior
notice by Lender to Guarantor designating the time and place of any public sale
or the time after which any private sale or other intended disposition of
Collateral is to be made, shall be deemed to be reasonable notice thereof and
Guarantor waives any other notice. In the event Lender institutes an action to
recover any Collateral or seeks recovery of any Collateral by way of
prejudgment remedy, Guarantor waives the posting of any bond which might
otherwise be required.


 


(iii)                        Without limiting any provision of this
Agreement, Guarantor acknowledges that at any time or times that an Event of
Default exists or has occurred and is continuing Lender shall have available to
it and may exercise any and all rights under applicable law.


 


(iv)                       To the extent that applicable law imposes
duties on Lender to exercise remedies in a commercially reasonable manner
(which duties cannot be waived under such law), Guarantor acknowledges and
agrees that it is not commercially unreasonable for Lender (A) to fail to incur
expenses reasonably deemed significant by Lender to prepare Collateral for
disposition or otherwise to complete raw material or work in process into
finished


 


15





















 


goods
or other finished products for disposition, (B) to fail to obtain third party
consents for access to Collateral to be disposed of, or to obtain or, if not
required by other law, to fail to obtain consents of any Governmental Authority
or other third party for the collection or disposition of Collateral to be
collected or disposed of, (C) to fail to exercise collection remedies against
account debtors, secondary obligors or other persons obligated on Collateral or
to remove liens or encumbrances on or any adverse claims against Collateral,
(D) to exercise collection remedies against account debtors and other persons
obligated on Collateral directly or through the use of collection agencies and
other collection specialists, (E) to advertise dispositions of Collateral
through publications or media of general circulation, whether or not the
Collateral is of a specialized nature, (F) to contact other persons, whether or
not in the same business as Guarantor, for expressions of interest in acquiring
all or any portion of the Collateral, (G) to hire one or more professional
auctioneers to assist in the disposition of Collateral, whether or not the
collateral is of a specialized nature, (H) to dispose of Collateral by
utilizing Internet sites that provide for the auction of assets of the types
included in the Collateral or that have the reasonable capability of doing so,
or that match buyers and sellers of assets, (I) to dispose of assets in
wholesale rather than retail markets, (J) to disclaim disposition warranties,
(K) to purchase insurance or credit enhancements to insure Lender against risks
of loss, collection or disposition of Collateral or to provide to the Lender a
guaranteed return from the collection or disposition of Collateral, or (L) to
the extent deemed appropriate by the Lender, to obtain the services of other
brokers, investment bankers, consultants and other professionals to assist the
Lender in the collection or disposition of any of the Collateral. Guarantor
acknowledges that the purpose of this Section is to provide non-exhaustive
indications of what actions or omissions by Lender would not be commercially
unreasonable in Lender’s exercise of remedies against the Collateral and that
other actions or omissions by Lender shall not be deemed commercially
unreasonable solely on account of not being indicated in this Section. Without
limitation of the foregoing, nothing contained in this Section shall be
construed to grant any rights to Guarantor or to impose any duties on Lender
that would not have been granted or imposed by this Agreement or by applicable
law in the absence of this Section.


 


(v)                          For the purpose of enabling Lender to
exercise the rights and remedies
hereunder, Guarantor hereby grants to Lender, to the extent assignable, an
irrevocable, non-exclusive license (exercisable without payment of royalty or
other compensation to Guarantor) to use, assign, license or sublicense any of
the trademarks, service-marks, trade names, business names, trade styles,
designs, logos and other source of business identifiers and other Intellectual
Property and general intangibles now owned or hereafter acquired by Guarantor,
wherever the same maybe located, including in such license reasonable access to
all media in which any of the licensed items may be recorded or stored and to
all computer programs used for the compilation or printout thereof.


 


(vi)                       Lender may apply the cash proceeds of
Collateral actually received by Lender from any sale, lease, foreclosure or
other disposition of the Collateral to payment of the Guaranteed Obligations,
in whole or in part and in such order as Lender may elect, whether or not then
due. Guarantor shall remain liable to Lender for the payment of any deficiency
with interest at the highest rate provided for in the Loan Agreement and all
costs and expenses of collection or enforcement, including attorneys’ fees and
legal expenses.


 


16





















 


11.                 Termination. This Agreement is continuing, unlimited, absolute and unconditional.
All Guaranteed Obligations shall be conclusively presumed to have been created in
reliance on this Agreement. Guarantor shall continue to be liable hereunder
until the indefeasible payment in full of the Guaranteed Obligations.
Revocation or termination hereof by Guarantor shall not affect, in any manner,
the rights of Lender or any obligations or duties of Guarantor under this
Agreement with respect to (a) Guaranteed Obligations which have been created,
contracted, assumed or incurred prior to the receipt by Lender of such written
notice of revocation or termination as provided herein, including, without
limitation, (i) all amendments, extensions, renewals and modifications of such
Guaranteed Obligations (whether or not evidenced by new or additional
agreements, documents or instruments executed on or after such notice of
revocation or termination), (ii) all interest, fees and similar charges
accruing or due on and after revocation or termination, and (iii) all attorneys’
fees and legal expenses, costs and other expenses paid or incurred on or after
such notice of revocation or termination in attempting to collect or enforce
any of the Guaranteed Obligations against Borrower, Guarantor or any other Obligor
(whether or not suit be brought), or (b) Guaranteed Obligations which have teen
created, contracted, assumed or incurred after the receipt by Lender of such written
notice of revocation or termination as provided herein pursuant to any contract
entered into by Lender prior to receipt of such notice. The sole effect of such
revocation or termination by Guarantor shall be to exclude from this Agreement
the liability of Guarantor for those Guaranteed Obligations arising after the
date of receipt by Lender of such written notice which are unrelated to
Guaranteed Obligations arising or transactions entered into prior to such date.
Without limiting the foregoing, this Agreement may not be terminated and shall
continue so long as the Loan Agreement shall be in effect (whether during its
original term or any renewal, substitution or extension thereof).


 


12.                 Reinstatement. If after receipt of any payment of, or
proceeds of collateral applied to the payment of, any of the Guaranteed
Obligations, Lender is required to surrender or return such payment or proceeds
to any Person for any reason, then the Guaranteed Obligations intended to be
satisfied by such payment or proceeds shall be reinstated and continue and this
Agreement shall continue in full force and effect as if such payment or
proceeds had not been received by Lender. Guarantor shall be liable to pay to
Lender the amount of any payments or proceeds surrendered or returned. This
Section 12 shall remain effective notwithstanding any contrary action which may
be taken by Lender in reliance upon such payment or proceeds. This Section 12
shall survive the termination or revocation of this Agreement.


 


13.                 Amendments and Waivers. Neither this Agreement nor any provision
hereof shall be amended, modified, waived or discharged orally or by course of
conduct, but only by a written agreement signed by an authorized officer of
Lender, and as to any amendments, as also signed by an authorized officer of
Guarantor. Lender shall not by any act, delay, omission or otherwise be deemed
to have expressly or impliedly waived any of its rights, powers and/or remedies
unless such waiver shall be in writing and signed by an authorized officer of
Lender. Any such waiver shall be enforceable only to the extent specifically
set forth therein. A waiver by Lender of any right, power and/or remedy on any
one occasion shall not be construed as a bar to or waiver of any such right,
power and/or remedy which Lender would otherwise have on any future occasion,
whether similar in kind or otherwise.


 


17





















 


14.                 Corporate Existence, Power and Authority. Guarantor is a corporation duly organized
and in good standing under the laws of its state or other jurisdiction of
incorporation and is duly qualified as a foreign corporation and in good
standing in all states or other jurisdictions where the nature and extent of
the business transacted by it or the ownership of assets makes such
qualification necessary, except for those jurisdictions in which the failure to
so qualify would not have a material adverse effect on the financial condition,
results of operation or businesses of Guarantor or the rights of Lender hereunder
or under any of the other Financing Agreements. The execution, delivery and
performance of this Agreement: (a) are within the corporate powers of
Guarantor, (b) have been duly authorized, (c) are not in contravention of law
or the terms of the certificate of incorporation, by-laws, or other
organizational documentation of Guarantor, or any indenture, agreement or
undertaking to which Guarantor is a party or by which Guarantor or its property
are bound and (d) will not result in the creation or imposition of, or require
or give rise to any obligation to grant, any lien, security interest, charge or
other encumbrance upon any property of Guarantor other than under this
Agreement and the other Financing Documents. This Agreement constitutes the
legal, valid and binding obligation of Guarantor enforceable in accordance with
its terms.


 


15.                 Governing Law; Choice of Forum; Service of
Process; Jury Trial Waiver.


 


(a)                   The validity, interpretation and enforcement
of this Agreement and any dispute arising out of the relationship between
Guarantor and Lender, whether in contract, tort, equity or otherwise, shall be
governed by the internal laws of the State of California applicable to contracts
made and to be performed in that State.


 


(b)                  Guarantor hereby irrevocably consents and
submits to the non-exclusive jurisdiction of the state and federal courts
located in Los Angeles County, California, and waives any objection based on
venue or forum  non  conveniens with respect to any action
instituted therein arising under this Agreement or any of the other Financing
Agreements or in any way connected with or related or incidental to the
dealings of Guarantor and Lender in respect of this Agreement or any of the
other Financing Agreements or the transactions related hereto or thereto, in
each case whether now existing or hereafter arising and whether in contract,
tort, equity or otherwise, and agrees that any dispute arising out of the
relationship between Guarantor or Borrower and Lender or the conduct of any
such persons in connection with this Agreement, the other Financing Agreements
or otherwise shall be heard only in the courts described above (except that
nothing herein shall preclude Lender from bringing any action or proceeding
against Guarantor or its property in the courts of any other jurisdiction which
Lender deems necessary or appropriate in order to realize on any collateral at
any time granted by Borrower or Guarantor to Lender or to otherwise enforce its
rights against Guarantor or its property).


 


(c)                   GUARANTOR HEREBY WAIVES ANY RIGHT TO TRIAL BY
JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (i) ARISING UNDER THIS AGREEMENT
OR ANY OF THE OTHER FINANCING AGREEMENTS OR (ii) IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF GUARANTOR AND LENDER IN RESPECT OF
THIS AGREEMENT OR ANY OF THE OTHER FINANCING AGREEMENTS OR THE TRANSACTIONS
RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. GUARANTOR


 


18





















 


HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT GUARANTOR OR LENDER MAY
FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF GUARANTOR AND LENDER TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.


 


(d)                  Lender shall not have any liability to
Guarantor (whether in tort, contract, equity or otherwise) for losses suffered
by Guarantor in connection with, arising out of, or in any way related to the
transactions or relationships contemplated by this Agreement, or any act,
omission or event occurring in connection herewith, unless it is determined by
a final and non-appealable judgment or court order binding on Lender that the
losses were the result of acts or omissions constituting gross negligence or
willful misconduct of Lender (as determined pursuant to a final, non-appealable
order of a court of competent jurisdiction).


 


16.                 Notices. All notices, requests and demands hereunder shall be in writing and deemed
to have been given or made: if delivered in person, immediately upon delivery,
if by telex, telegram or facsimile transmission, immediately upon sending and
upon confirmation of receipt; if by nationally recognized overnight courier
service with instructions to deliver the next business day, upon one (1)
business day after sending; and if by certified mail, with verification of
delivery, upon such confirmed delivery date. All notices, requests and demands
upon the parties are to be given to the addresses designated on the signature
page hereto or to such other address as any party may designate by notice in
accordance with this Section.


 


17.                 Partial Invalidity. If any provision of this Agreement is held
to be invalid or unenforceable, such invalidity or unenforceability shall not
invalidate this Agreement as a whole, but this Agreement shall be construed as
though it did not contain the particular provision held to be invalid or unenforceable
and the rights and obligations of the parties shall be construed and enforced
only to such extent as shall be
permitted by applicable law.


 


18.                 Entire Agreement. This Agreement represents the entire
agreement and understanding of the parties concerning the subject matter
hereof, and supersedes all other prior agreements, understandings, negotiations
and discussions, representations, warranties, commitments, proposals, offers
and contracts concerning the subject matter hereof, whether oral or written.


 


19.                 Successors and Assigns. This Agreement shall be binding upon
Guarantor and its successors and assigns and shall inure to the benefit of
Lender and its successors, endorsees, transferees and assigns. The liquidation,
dissolution or termination of Guarantor shall not terminate this Agreement as
to such entity or as to Guarantor.


 


20.                 Interpretive Provisions.


 


(a)                   All terms used herein related to the
attachment, perfection, priority or enforcement of the security interests
granted hereby which are defined in Division 1 or Division 9 of the UCC shall
have the meanings given therein unless otherwise defined in this Agreement.


 


19





















 


(b)                  All references to the plural herein shall
also mean the singular and to the singular shall also mean the plural unless
the context otherwise requires.


 


(c)                   All references to Guarantor and Lender
pursuant to the definitions set forth in the recitals hereto, or to any other
person herein, shall include their respective successors and assigns
(including, without limitation, any receiver, trustee or custodian for such
person or any of its assets or such person in its capacity as debtor or
debtor-in-possession under the United States Bankruptcy Code).


 


(d)                  The words “hereof”, “herein”, “hereunder”, “this
Agreement” and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not any particular provision of this Agreement
and as this Agreement now exists or may hereafter be amended, modified, supplemented,
extended, renewed, restated or replaced.


 


(e)                   The word “including” when used in this
Agreement shall mean “including, without limitation”.


 


(f)                     An Event of Default shall exist or continue
or be continuing until such Event of Default is waived in accordance with
Section 13 or is cured in a manner satisfactory to Lender, if such Event of
Default is capable of being cured as determined by Lender.


 


(g)                  Any accounting term used in this Agreement
shall have, unless otherwise specifically provided herein, the meaning
customarily given in accordance with GAAP, and all financial computations
hereunder shall be computed unless otherwise specifically provided herein, in
accordance with GAAP as consistently applied and using the same method for inventory
valuation as used in the preparation of the financial statements of Guarantor
most recently received by Lender prior to the date hereof.


 


(h)                  In the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including”, the words “to” and “until” each mean “to but excluding” and the
word “through” means “to and including”.


 


(i)                      Unless otherwise expressly provided herein,
(i) references herein to any agreement, document or instrument shall be deemed
to include all subsequent amendments, modifications, supplements, extensions,
renewals, restatements or replacements with respect thereto, but only to the
extent the same are not prohibited by the terms hereof or of any other
Financing Agreement, and (ii) references to any statute or regulation are to be
construed as including all statutory and regulatory provisions consolidating,
amending, replacing, recodifying, supplementing or interpreting the statute or
regulation.


 


(j)                      The captions and headings of this Agreement
are for convenience of reference only and shall not affect the interpretation
of this Agreement.


 


(k)                   This Agreement and other Financing Agreements
may use several different limitations, tests or measurements to regulate the
same or similar matters. All such limitations, tests and measurements are
cumulative and shall each be performed in accordance with their terms.


 


20





















 


(l)                      This Agreement and the other Financing
Agreements are the result of negotiations among and have been reviewed by
counsel to Lender and counsel to Guarantor, and are the products of all
parties. Accordingly, this Agreement and the other Financing Agreements shall
not be construed against Lender merely because of Lender’s involvement in their
preparation.


 


21.                 Amended and Restated Agreement; Reference to
and Effect on Financing Agreements. This Agreement amends and restates, in their entirety, the agreements
among the parties hereto contained in the Original Guaranty. All other
Financing Agreements to which Guarantor is a party, are and shall continue to
be in full force and effect and are hereby in all respects ratified and
confirmed and shall constitute the legal, valid, binding and enforceable obligations
of Guarantor to Lender, except that each reference in the Financing Agreements
to the Original Guaranty (howsoever phrased), shall mean and be a reference to
this Agreement. The execution, delivery and effectiveness of this Agreement
shall not operate as a waiver of any right, power, or remedy of Lender under
any of the Financing Agreements, nor constitute a waiver of any provision of
any of the Financing Agreements.


 


22.                 Estoppel. To induce Lender to enter into this Agreement and to continue to make
advances to Borrower under the Loan Agreement, Guarantor hereby acknowledges
and agrees that, as of the date hereof, there exists no Default or Event of
Default and no right of offset,


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]


 


21





















 


defense,
counterclaim or objection in favor of Guarantor as against Lender with respect
to the Guaranteed Obligations.


 


1N WITNESS WHEREOF, Guarantor and Lender have each
executed and delivered this Agreement as of the day and year first above
written.


 


	
   

  	
  GEOLOGIST1CS
  CORPORATION,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Janet Helvey

  
	
   

  	
  Name:

  	
  Janet
  Helvey

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
  Address
  For Notices

  
	
   

  	
   

  
	
   

  	
  1251
  East Dyer Road, Suite 250

  
	
   

  	
  Santa
  Ana, California 92705

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CONGRESS
  FINANCIAL CORPORATION

  
	
   

  	
  (WESTERN),

  
	
   

  	
  a
  California corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Gary Whitaker

  
	
   

  	
  Name:

  	
  Gary
  Whitaker

  
	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
  Address
  For Notices

  
	
   

  	
   

  
	
   

  	
  251
  South Lake Avenue, Suite 900

  
	
   

  	
  Pasadena, California 91101

  
				



 


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