**Exhibit 10.3**

 

**FORM OF CONTINUING GUARANTY**

**TO BE EXECUTED BY CERTAIN SUBSIDIARIES OF**

**BROADWIND ENERGY, INC.**

 

TO:         WELLS FARGO BANK, NATIONALASSOCIATION

 

1.             GUARANTY;DEFINITIONS.  Inconsideration of any credit or other financial accommodation heretofore, now orhereafter extended or made to[                                                                          ]  (collectively, “Customer”)], by WELLS FARGOBANK, NATIONAL ASSOCIATION (together with all its participants, successors andassigns, “WFBC”), acting through its Wells Fargo Business Credit operatingdivision, and for other valuable consideration, the undersigned[                                              ](“Guarantor”), jointly and severally unconditionally guarantees and promises topay to WFBC, or order, on demand in lawful money of the United States ofAmerica and in immediately available funds, any and all Obligations.  The term “Obligations” is used in its mostcomprehensive sense and means any debts, obligations and liabilities of Customerto WFBC, whether incurred in the past, present or future, whether voluntary orinvoluntary, and however arising, and whether due or not due, absolute orcontingent, liquidated or unliquidated, determined or undetermined, whether ornot Customer may be liable individually or jointly or jointly and severallywith others, or whether recovery upon such Obligations may subsequently becomeunenforceable.  This Guaranty is aguaranty of payment and not collection.

 

2.             SUCCESSIVETRANSACTIONS; REVOCATION; OBLIGATION UNDER OTHER GUARANTIES.  This is a continuing guaranty and all rights,powers and remedies hereunder shall apply to all past, present and futureObligations, including those arising under successive transactions which shalleither continue the Obligations, increase or decrease them, or from time totime create new Obligations after all or any prior Obligations have beensatisfied, and notwithstanding the death, incapacity, dissolution, liquidationor bankruptcy of Customer or Guarantor or any other event or proceedingaffecting either Customer or Guarantor. This Guaranty shall not apply to any new Obligations created afteractual receipt by WFBC of written notice of Guarantor’s revocation as to suchnew Obligations; provided, however, that credit or other financialaccommodations made by WFBC to Customer after revocation under commitmentsexisting prior to receipt by WFBC of such revocation, and extensions, renewalsor modifications, of any kind, of Obligations incurred by Customer or committedby WFBC prior to receipt by WFBC of such notice of revocation, shall not beconsidered new Obligations.  Any suchnotice must be sent to WFBC by registered U.S. mail, postage prepaid, addressedto its office at Wells Fargo Bank, National Association, MAC C7300-060, 1740Broadway, 6th Floor, Denver, Colorado 80274, Attention: Monica Sorrels, or at such other address as WFBC shallfrom time to time designate.  Any paymentmade by Guarantor under this Guaranty shall be effective to reduce or dischargeGuarantor’s maximum obligation hereunder only if accompanied by a writtennotice to that effect, received by WFBC, advising WFBC that such payment ismade under this Guaranty for such purpose. The obligations of Guarantor under this Guaranty shall be in addition toany obligations of Guarantor under any other guaranties of any liabilities orobligations of Customer or other Persons that may be given to WFBC at any time,unless the other guaranties are expressly modified or revoked in writing; andthis Guaranty shall not, unless expressly provided for in this Guaranty, affector invalidate any such other guaranties. As used 

 

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herein,“Person” means any individual, corporation, partnership, joint venture, limitedliability company, association, joint stock company, trust, unincorporatedorganization or government or any agency or political subdivision of agovernmental entity.

 

3.             LIMITATION;INSOLVENCY LAWS.  As used inthis paragraph:  (a) the term “ApplicableInsolvency Laws” means the laws of the United States of America, or of anystate, province, nation or other governmental unit relating to bankruptcy,reorganization, arrangement, adjustment of debts, relief of debtors,dissolution, insolvency, fraudulent transfers or conveyances or other similarlaws (including, without limitation, 11 U.S.C. §547, §548, §550 and other “avoidance”provisions of Title 11 of the United Stated Code) as applicable in anyproceeding in which the validity or enforceability of this Guaranty or anySpecified Lien is in issue; and (b) “Specified Lien” means any securityinterest, mortgage, lien or encumbrance securing this Guaranty, in whole or inpart.  Notwithstanding any otherprovision of this Guaranty, if, in any proceeding, a court of competentjurisdiction determines that this Guaranty or any Specified Lien would, but forthe operation of this paragraph, be subject to avoidance or recovery or beunenforceable by reason of Applicable Insolvency Laws, this Guaranty and eachsuch Specified Lien shall be valid and enforceable only to the maximum extentthat would not cause this Guaranty or such Specified Lien to be subject toavoidance, recovery or unenforceability. To the extent that any payment to, or realization by, WFBC on theguaranteed Obligations exceeds the limitations of this paragraph and isotherwise subject to avoidance and recovery in any such proceeding, the amountsubject to avoidance shall in all events be limited to the amount by which suchactual payment or realization exceeds such limitation, and this Guaranty aslimited shall in all events remain in full force and effect and be fullyenforceable against Guarantor.  Thisparagraph is intended solely to reserve the rights of WFBC hereunder againstGuarantor in such proceeding to the maximum extent permitted by Applicable InsolvencyLaws and neither Guarantor, Customer, any other guarantor of the Obligations,nor any other Person shall have any right, claim or defense under thisparagraph that would not otherwise be available under Applicable InsolvencyLaws in such proceeding.  The Obligationsmay be created and continued in any amount, whether or not in excess of theamount not subject to avoidance, without affecting or impairing Guarantor’sliability hereunder, and WFBC may pay (or allow for the payment of) the excessout of any sums received by or available to WFBC on account of the Obligationsfrom Customer or any other Person (except Guarantor), from their properties,out of any collateral security or from any other source, and such payment (orallowance) shall not reduce, affect or impair Guarantor’s liability hereunder.

 

4.             OBLIGATIONSJOINT AND SEVERAL; SEPARATE ACTIONS; WAIVER OF STATUTE OF LIMITATIONS;REINSTATEMENT OF LIABILITY.  The obligations of Guarantor under thisGuaranty are joint and several and independent of the obligations of Customer,and a separate action or actions may be brought and prosecuted againstGuarantor, whether the action is brought against Customer or other Persons, orwhether Customer or other Persons are joined in any such action or actions.  Guarantor acknowledges that this Guaranty isabsolute and unconditional, that there are no conditions precedent to theeffectiveness of this Guaranty, and that this Guaranty is in full force andeffect and binding on Guarantor as of the date written below, regardless ofwhether WFBC obtains collateral or any guaranties from others or takes anyother action contemplated by Guarantor. Guarantor waives the benefit of any statute of limitations affecting theenforcement of Guarantor’s liability under this Guaranty, and Guarantor agreesthat any payment of any Obligations or other act which shall toll anyapplicable 

 

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statuteof limitations shall similarly toll the statute of limitations applicable toGuarantor’s liability under this Guaranty. The liability of Guarantor hereunder shall be reinstated and revived andthe rights of WFBC shall continue if and to the extent for any reason anyamount at any time paid on account of any Obligations guaranteed hereby isrescinded or must otherwise be restored by WFBC, whether as a result of anyproceedings in bankruptcy or reorganization or otherwise, all as though suchamount had not been paid.  Thedetermination as to whether any amount so paid must be rescinded or restoredshall be made by WFBC in its sole discretion; provided, however, that if WFBCchooses to contest any such matter at the request of Guarantor, Guarantoragrees to indemnify and hold WFBC harmless from and against all costs andexpenses, including reasonable attorneys’ fees, expended or incurred by WFBC inconnection therewith, including without limitation, in any litigation withrespect thereto.

 

5.             AUTHORIZATIONSTO WFBC.  Guarantor authorizes WFBCeither before or after revocation hereof, without notice to or demand onGuarantor, and without affecting Guarantor’s liability hereunder, from time totime to: (a) alter, compromise, renew, extend, accelerate or otherwise changethe time for payment of, or otherwise change the terms of the Obligations orany portion thereof, including increase or decrease of the rate of interestthereon; (b) take and hold security for the payment of this Guaranty or theObligations or any portion thereof, and exchange, enforce, waive, subordinateor release any such security; (c) apply such security and direct the order ormanner of sale thereof, including without limitation, a non-judicial salepermitted by the terms of the controlling security agreement, mortgage or deedof trust, as WFBC in its discretion may determine; (d) release or substituteany one or more of the endorsers or any other guarantors of the Obligations, orany portion thereof, or any other party thereto; and (e) apply paymentsreceived by WFBC from Customer to any portion of the Obligations, in such orderas WFBC shall determine in its sole discretion, whether or not such Obligationsare covered by this Guaranty, and Guarantor hereby waives any provision of lawregarding application of payments which specifies otherwise.  WFBC may without notice assign this Guarantyin whole or in part.  Upon WFBC’srequest, Guarantor agrees to provide to WFBC copies of Guarantor’s financialstatements.

 

6.             REPRESENTATIONS,WARRANTIES AND COVENANTS. Guarantor represents, warrants and covenants to WFBC that: (a) this Guarantyis executed at Customer’s request; (b) Guarantor shall not, without WFBC’sprior written consent, sell or otherwise dispose of all or substantially all ofGuarantor’s assets other than in the ordinary course of Guarantor’s business;(c) WFBC has made no representation to Guarantor as to the creditworthiness ofCustomer; and (d) Guarantor has established adequate means of obtaining fromCustomer on a continuing basis financial and other information pertaining toCustomer’s financial condition.  Guarantoragrees to keep adequately informed of any facts, events or circumstances whichmight in any way affect Guarantor’s liability under this Guaranty, andGuarantor further agrees that WFBC shall have no obligation to disclose toGuarantor any information or material about Customer which is acquired by WFBCin any manner.

 

7.             GUARANTOR’SWAIVERS.

 

(a)           Guarantorwaives any right to require WFBC to: (i) proceed against Customer or anyother Person; (ii) marshal assets or proceed against or exhaust anysecurity granted by Customer or any other Person; (iii) give notice of theterms, time and place of any public or 

 

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privatesale or other disposition of personal property security granted by Customer orany other Person; (iv) take any other action or pursue any other remedy in WFBC’spower; or (v) make any presentment or demand for performance, or give anynotice of nonperformance, protest, notice of protest or notice of dishonorhereunder or in connection with any obligations or evidences of indebtednessheld by WFBC as security for or which constitute in whole or in part theObligations guaranteed hereunder, or in connection with the creation of new oradditional Obligations.

 

(b)           Guarantorwaives any defense to its obligations hereunder based upon or arising by reasonof: (i) any disability or other defense of Customer or any other Person; (ii)the cessation or limitation from any cause whatsoever, other than payment infull, of the Obligations or the indebtedness of any other Person; (iii) anylack of authority of any officer, director, partner, agent or any other Personacting or purporting to act on behalf of Customer, if it is a corporation,partnership or other type of entity, or any defect in the formation ofCustomer; (iv) the application by Customer of the proceeds of anyObligations for purposes other than the purposes represented by Customer to, orintended or understood by, WFBC or Guarantor; (v) any act or omission by WFBCwhich directly or indirectly results in or aids the discharge of Customer orany portion of the Obligations by operation of law or otherwise, or which inany way impairs or suspends any rights or remedies of WFBC against Customer;(vi) any impairment of the value of any interest in any security for theObligations or any portion thereof, including without limitation, the failureto obtain or maintain perfection or recordation of any interest in any suchsecurity, the release of any such security without substitution, or the failureto preserve the value of, or to comply with applicable law in disposing of, anysuch security; (vii) any modification of the Obligations, in any formwhatsoever, including any modification made after revocation hereof to anyObligations incurred prior to such revocation, and including without limitationthe renewal, extension, acceleration or other change in time for payment of, orother change in the terms of, the Obligations or any portion thereof; or (viii)any requirement that WFBC give any notice of acceptance of this Guaranty.  Until all Obligations have been paid in full,Guarantor shall have no right of subrogation, and Guarantor waives any right toenforce any remedy which WFBC now has or may hereafter have against Customer orany other Person, and waives any benefit of, or any right to participate in,any security now or hereafter held by WFBC. Guarantor further waives all rights and defenses Guarantor may havearising out of (A) any election of remedies by WFBC, even though thatelection of remedies, such as a non-judicial foreclosure with respect to anysecurity for any portion of the Obligations, destroys Guarantor’s rights ofsubrogation or Guarantor’s rights to proceed against Customer forreimbursement, or (B) any loss of rights Guarantor may suffer by reason ofany rights, powers or remedies of Customer in connection with anyanti-deficiency laws or any other laws limiting, qualifying or discharging theObligations, whether by operation of law or otherwise, including any rightsGuarantor may have to a fair market value hearing to determine the size of adeficiency following any foreclosure sale or other disposition of any realproperty security for any portion of the Obligations.

 

8.             WFBC’S RIGHTSWITH RESPECT TO GUARANTOR’S PROPERTY IN WFBC’S POSSESSION.  In addition to all liens upon and rights ofsetoff against the monies, securities or other property of Guarantor given toWFBC by law, WFBC shall have a lien upon and a right of setoff against allmonies, securities and other property of Guarantor now or 

 

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hereafterin the possession of or on deposit with WFBC, whether held in a general orspecial account or deposit or for safekeeping or otherwise, and every such lienand right of setoff may be exercised without demand upon or prior notice toGuarantor.  WFBC agrees promptly tonotify Guarantor after any such setoff and application made by WFBC.  No lien or right of setoff shall be deemed tohave been waived by any act or conduct on the part of WFBC, or by any neglectto exercise such right of setoff or to enforce such lien, or by any delay in sodoing, and every right of setoff and lien shall continue in full force andeffect until such right of setoff or lien is specifically waived or released byWFBC in writing.

 

9.             SUBORDINATION.  Any indebtedness of Customer now or hereafterheld by Guarantor is hereby subordinated to the Obligations.  Such indebtedness of Customer to Guarantor isassigned to WFBC as security for this Guaranty and the Obligations and, if WFBCrequests, upon the occurrence of an Event of Termination, shall be collectedand received by Guarantor as trustee for WFBC and paid over to WFBC on accountof the Obligations but without reducing or affecting in any manner theliability of Guarantor under the other provisions of this Guaranty.  Any notes or other instruments now orhereafter evidencing such indebtedness of Customer to Guarantor shall be markedwith a legend that indicates that the notes or other instruments are subject tothis Guaranty and, if WFBC so requests, such notes and instruments shall bedelivered to WFBC.  WFBC is herebyauthorized in the name of Guarantor from time to time to file financingstatements and continuation statements and execute such other documents and takesuch other action as WFBC deems necessary or appropriate to perfect, preserveand enforce its rights hereunder.

 

10.           REMEDIES; NOWAIVER.  All rights, powers andremedies of WFBC hereunder are cumulative. No delay, failure or discontinuance of WFBC in exercising any right,power or remedy hereunder shall affect or operate as a waiver of such right,power or remedy; nor shall any single or partial exercise of any such right,power or remedy preclude, waive or otherwise affect any other or further exercisethereof or the exercise of any other right, power or remedy.  Any waiver, permit, consent or approval ofany kind by WFBC of any breach of this Guaranty, or any such waiver of anyprovisions or conditions hereof, must be in writing and shall be effective onlyto the extent set forth in writing.

 

11.           COSTS, EXPENSESAND ATTORNEYS’ FEES.  Guarantorshall pay to WFBC immediately upon demand the full amount of all payments,advances, charges, costs and expenses, including reasonable attorneys’ fees (toinclude outside counsel fees and all allocated costs of WFBC’s in-housecounsel), expended or incurred by WFBC in connection with the enforcement ofany of WFBC’s rights, powers or remedies or the collection of any amounts whichbecome due to WFBC under this Guaranty, and the prosecution or defense of anyaction in any way related to this Guaranty, whether incurred at the trial orappellate level, in an arbitration proceeding or otherwise, and including anyof the foregoing incurred in connection with any bankruptcy proceeding(including without limitation, any adversary proceeding, contested matter ormotion brought by WFBC or any other Person) relating to Guarantor or any otherPerson.  All of the foregoing shall bepaid by Guarantor with interest from the date of demand until paid in full at arate per annum equal to the greater of ten percent (10%) or WFBC’s Prime Ratein effect from time to time.

 

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12.           SUCCESSORS;ASSIGNMENT.  ThisGuaranty shall be binding upon and inure to the benefit of the heirs,executors, administrators, legal representatives, successors and assigns of theparties; provided, however, that Guarantor may not assign or transfer any ofits interests or rights hereunder without WFBC’s prior written consent.  Guarantor acknowledges that WFBC has theright to sell, assign, transfer, negotiate or grant participations in all orany part of, or any interest in, the Obligations and any obligations withrespect thereto, including this Guaranty. In connection therewith, subject to all confidentiality agreements ofWFBC in favor of Customer and its affiliates, WFBC may disclose all documentsand information which WFBC now has or hereafter acquires relating to Guarantoror this Guaranty, whether furnished by Customer, Guarantor or otherwise.  Guarantor further agrees that WFBC maydisclose such documents and information to Customer.

 

13.           AMENDMENT.  This Guaranty may be amended or modified onlyin writing signed by WFBC and Guarantor.

 

14.           INTERPRETATION.  All references to the term “Customer” hereinshall refer to each of[                                      ]separately and to all of them jointly where context and construction sorequire.  When this Guaranty is executedby more than one Guarantor, the word “Guarantor” shall mean all or any one ormore of them as the context requires. Unless the context clearly requires otherwise, the word “or” has theinclusive meaning represented by the phrase “and/or”.

 

15.           UNDERSTANDINGWITH RESPECT TO WAIVERS; SEVERABILITY OF PROVISIONS.  Guarantor warrants and agrees that each ofthe waivers set forth herein is made with Guarantor’s full knowledge of itssignificance and consequences, and that under the circumstances, the waiversare reasonable and not contrary to public policy or law.  If any waiver or other provision of thisGuaranty shall be held to be prohibited by or invalid under applicable publicpolicy or law, such waiver or other provision shall be ineffective only to theextent of such prohibition or invalidity, without invalidating the remainder ofsuch waiver or other provision or any remaining provisions of this Guaranty.

 

16.           GOVERNING LAW.  This Guaranty shall be governed by andconstrued in accordance with the laws of the State of Colorado.

 

17.           WAIVEROF JURY TRIAL. GUARANTOR IRREVOCABLYWAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIMARISING OUT OF, BASED ON OR PERTAINING TO THIS GUARANTY.

 

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INWITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty as ofSeptember 28, 2010.

 
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|   | By:                                                                                                                                                                                                                                                                                                                        |   |
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|   | Its:  Authorized Signatory                                                                                                                                                                                                                                                                                            |

 

SignaturePage to Guaranty

 

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