InfoTech USA, Inc. Exhibit 10.2 to Form 8K






Exhibit 10.2



GUARANTY BY CORPORATIONS 



        THIS
GUARANTY, dated as of June 29, 2004, is made by INFOTECH USA, INC., a Delaware
corporation (the “Parent”), and INFORMATION TECHNOLOGY SERVICES, INC., a
New York corporation (“ITSI”; the Parent and ITSI, each a “Guarantor”
and collectively the “Guarantors”), for the benefit of WELLS FARGO BUSINESS
CREDIT, INC., a Minnesota corporation (with its participants, successors and assigns,
the “Lender”). 



        The
Lender, InfoTech USA, Inc., a New Jersey corporation (the “Borrower”), and the
Guarantors are parties to a Credit and Security Agreement of even date herewith (as the
same may be amended, supplemented or restated from time to time, the “Credit
Agreement”) pursuant to which the Lender may make advances and extend other financial
accommodations to the Borrower. 



        As
a condition to extending such credit to the Borrower, the Lender has required the
execution and delivery of this Guaranty. 



        ACCORDINGLY,
each Guarantor, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, hereby agrees
as follows: 



             1.    
          Definitions. All terms defined in the Credit Agreement that
          are not otherwise defined herein shall have the meanings given them in the
          Credit Agreement. 



             2.    
          Indebtedness Guaranteed.  Each Guarantor hereby absolutely,
          unconditionally and irrevocably guarantees, jointly and severally, to the Lender
          the full and prompt payment when due, whether at maturity or earlier by reason
          of acceleration or otherwise, of: (i) the Obligations, and (ii) each and every
          other sum (including amounts that would become due but for the operation of the
          bankruptcy laws) now or hereafter owing to the Lender by the Borrower under the
          Loan Documents, including but not limited to, debts, liabilities and obligations
          arising out of loans, credit transactions, financial accommodations, discounts,
          purchases of property or other transactions with the Borrower or for the
          Borrower’s account or out of any other transaction or event, owed to the
          Lender or owed to others by reason of participations granted to or interests
          acquired or created for or sold to them by the Lender, in each case whether now
          existing or hereafter arising, whether arising directly in a transaction or
          event involving the Lender or acquired by the Lender from another by purchase or
          assignment or as collateral security, whether owed by the Borrower as drawer,
          maker, endorser, accommodation party, guarantor, principal, surety or as a
          member of any partnership, syndicate, association or group or in any other
          capacity, whether absolute or contingent, direct or indirect, primary or
          secondary, sole, joint, several or joint and several, secured or unsecured, due
          or not due, contractual, tortious or statutory, liquidated or unliquidated,
          arising by agreement or imposed by law or otherwise (all of sums referred to in
          clauses (i) and (ii) being hereinafter collectively called the
          “Indebtedness”). 



        Each
Guarantor acknowledges and agrees that the Indebtedness shall include, without limitation,
interest on any portion of the Indebtedness that accrues after the commencement of any
insolvency, bankruptcy, receivership, reorganization, liquidation, arrangement or other
similar proceeding (each, a “Proceeding”), whether voluntary or involuntary (or
if interest on any portion of the Indebtedness ceases to accrue by operation of law by
reason of the commencement of any Proceeding, such interest as would have accrued on such
portion of the Indebtedness as if such Proceeding had not been commenced). 





             3.    
          Guarantors’ Representations and Warranties. Each
          Guarantor represents and warrants to the Lender that: (i) such Guarantor is a
          corporation, duly organized and existing in good standing and has full power and
          authority to make and deliver this Guaranty; (ii) the execution, delivery and
          performance of this Guaranty by such Guarantor have been duly authorized by all
          necessary action of its directors and do not and will not violate the provisions
          of, or constitute a default under, any presently applicable law or its
          Constituent Documents or any agreement presently binding on it; (iii) this
          Guaranty has been duly executed and delivered by the authorized Officers of such
          Guarantor and constitutes its lawful, binding and legally enforceable
          obligation, except as limited by equitable principles and bankruptcy, insolvency
          and similar laws affecting creditors’ rights; and (iv) the authorization,
          execution, delivery and performance of this Guaranty do not require notification
          to, registration with, or consent or approval by, any federal, state or local
          regulatory body or administrative agency. Each Guarantor represents and warrants
          to the Lender that such Guarantor has a substantial economic interest in the
          Borrower and expects to derive substantial benefits therefrom and from any
          loans, credit transactions, financial accommodations, discounts, purchases of
          property and other transactions and events resulting in the creation of the
          Indebtedness guarantied hereby, and that this Guaranty is given for a corporate
          purpose. Accordingly, the Lender may rely conclusively on a continuing warranty,
          hereby made, that such Guarantor continues to be benefited by this Guaranty and
          the Lender shall have no duty to inquire into or confirm the receipt of any such
          benefits, and this Guaranty shall be effective and enforceable by the Lender
          without regard to the receipt, nature or value of any such benefits. 



             4.    
          Unconditional Nature.No act or thing need occur to
          establish any Guarantor’s liability hereunder, and no act or thing, except
          full payment and discharge of all of the Indebtedness, shall in any way
          exonerate any Guarantor hereunder or modify, reduce, limit or release such
          Guarantor’s liability hereunder. This is an absolute, unconditional,
          irrevocable and continuing guaranty of payment (and not merely of collection) of
          the Indebtedness and shall continue to be in force and be binding upon each
          Guarantor until all of the Indebtedness and all obligations of each Guarantor
          hereunder are irrevocably paid and performed in full and the Credit Agreement
          shall have terminated, notwithstanding that from time to time during the term of
          the Credit Agreement or this Guaranty, the Borrower may be free from any
          Indebtedness. Any payment made by any Guarantor under this Guaranty shall be
          effective to reduce or discharge such liability only if accompanied by a written
          transmittal document, received by the Lender, advising the Lender that such
          payment is made under this Guaranty for such purpose. 



             5.    
          Dissolution or Insolvency of any Guarantor. The dissolution
          or adjudication of bankruptcy of any Guarantor shall not revoke this Guaranty,
          except upon actual receipt of written notice thereof by the Lender and only
          prospectively, as to future transactions, as herein set forth. If any Guarantor
          shall be dissolved or shall be or become insolvent (however defined), then the
          Lender shall have the right to declare immediately due and payable, and each
          Guarantor will forthwith pay to the Lender, the full amount of all of the
          Indebtedness whether due and payable or unmatured. If any Guarantor voluntarily
          commences or there is commenced involuntarily against any Guarantor a case under
          the United States Bankruptcy Code, the full amount of all Indebtedness, whether
          due and payable or unmatured, shall be immediately due and payable without
          demand or notice thereof. 


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             6.    
          Subrogation, etc. Each Guarantor hereby waives all
          rights that such Guarantor may now have or hereafter acquire, whether by
          subrogation, contribution, reimbursement, recourse, exoneration, contract or
          otherwise, to recover from the Borrower or from any property of the Borrower any
          sums paid under this Guaranty. No Guarantor will exercise or enforce any right
          of contribution to recover any such sums from any person who is a co-obligor
          with the Borrower or a guarantor or surety of the Indebtedness or from any
          property of any such person until all of the Indebtedness shall have been fully
          and indefeasibly paid and discharged and the Credit Agreement shall have been
          terminated. 



             7.    
          Enforcement Expenses. Each Guarantor will pay or reimburse,
          jointly and severally, the Lender for all costs, expenses and reasonable
          attorneys’ fees and expenses paid or incurred by the Lender in endeavoring
          to collect and enforce the Indebtedness and in enforcing this Guaranty. 



             8.    
          Lender’s Rights. The Lender shall not be obligated by
          reason of its acceptance of this Guaranty to engage in any transactions with or
          for the Borrower. Whether or not any existing relationship between any Guarantor
          and the Borrower has been changed or ended, the Lender may enter into
          transactions resulting in the creation or continuance of the Indebtedness and
          may otherwise agree, consent to or suffer the creation or continuance of any of
          the Indebtedness, without any consent or approval by any Guarantor and without
          any prior or subsequent notice to any Guarantor. No Guarantor’s liability
          shall be affected or impaired by any of the following acts or things (which the
          Lender is expressly authorized to do, omit or suffer from time to time, without
          consent or approval by or notice to any Guarantor): (i) the invalidity,
          irregularity or unenforceability of the Credit Agreement or any other Loan
          Document, any Indebtedness, any security interest or any guaranty; (ii) any
          acceptance of collateral security, guarantors, accommodation parties or sureties
          for any or all of the Indebtedness; (iii) one or more extensions or renewals of
          the Indebtedness (whether or not for longer than the original period) or any
          modification of the interest rates, maturities, if any, or other contractual
          terms applicable to any of the Indebtedness or any amendment or modification of
          any of the terms or provisions of any loan agreement or other agreement under
          which the Indebtedness or any part thereof arose; (iv) any waiver or indulgence
          granted to the Borrower, any delay or lack of diligence in the enforcement of
          the Indebtedness or any failure to institute proceedings, file a claim, give any
          required notices or otherwise protect any of the Indebtedness; (v) any full or
          partial release of, compromise or settlement with, or agreement not to sue, the
          Borrower or any guarantor or other person liable in respect of any of the
          Indebtedness; (vi) any release, surrender, cancellation or other discharge of
          any evidence of the Indebtedness or the acceptance of any instrument in renewal
          or substitution therefor; (vii) any failure to obtain collateral security
          (including rights of setoff) for the Indebtedness, or to see to the proper or
          sufficient creation and perfection thereof, or to establish the priority
          thereof, or to preserve, protect, insure, care for, exercise or enforce any
          collateral security; or any modification, alteration, substitution, exchange,
          surrender, cancellation, termination, release or other change, impairment,
          limitation, loss or discharge of any collateral security; (viii) any collection,
          sale, lease or disposition of, or any other foreclosure or enforcement of or
          realization on, any collateral security; (ix) any assignment, pledge or other
          transfer of any of the Indebtedness or any evidence thereof; (x) any manner,
          order or method of 


–3–




     application of any payments or credits upon the Indebtedness;
          (xi) any limitation on the liabilities, obligations or indebtedness of the
          Borrower under any Loan Document, that may now or hereafter be imposed by any
          statute, regulation, rule of law or otherwise; (xii) any merger, consolidation
          or amalgamation of the Borrower into or with any other Person, or any sale,
          lease or transfer of the assets of the Borrower to any other Person; (xiii) any
          change in the ownership of any shares of capital stock of the Borrower; and
          (xiv) any election by the Lender under Section 1111(b) of the United States
          Bankruptcy Code. Each Guarantor waives any and all defenses and discharges
          available to a surety, guarantor or accommodation co-obligor. 



             9.    
          Waivers by Guarantors. 



             
    (a)       
          Each Guarantor waives any and all defenses, claims, setoffs and discharges of
          the Borrower, or any other obligor, pertaining to the Indebtedness, except the
          defense of discharge by payment in full. Without limiting the generality of the
          foregoing, no Guarantor will assert, plead or enforce against the Lender any
          defense of waiver, release, discharge or disallowance in bankruptcy, statute of
          limitations, res judicata, statute of frauds, anti-deficiency statute,
          fraud, incapacity, minority, usury, illegality or unenforceability which may be
          available to the Borrower or any other person liable in respect of any of the
          Indebtedness (including any Guarantor), or any setoff available against the
          Lender to the Borrower or any other such person, whether or not on account of a
          related transaction. Each Guarantor expressly agrees that such Guarantor shall
          be and remain liable for any deficiency remaining after foreclosure of any
          mortgage or security interest securing the Indebtedness, whether or not the
          liability of the Borrower or any other obligor for such deficiency is discharged
          pursuant to statute or judicial decision. The liability of any Guarantor shall
          not be affected or impaired by any voluntary or involuntary liquidation,
          dissolution, sale or other disposition of all or substantially all of the
          assets, marshalling of assets and liabilities, receivership, insolvency,
          bankruptcy, assignment for the benefit of creditors, reorganization,
          arrangement, composition or readjustment of, or other similar event or
          proceeding affecting, the Borrower or any of its assets. No Guarantor will
          assert, plead or enforce against the Lender any claim, defense or setoff
          available to any Guarantor against the Borrower. Each Guarantor waives
          diligence, presentment, demand for payment, notice of dishonor or nonpayment and
          protest of any instrument evidencing the Indebtedness. The Lender shall not be
          required first to resort for payment of the Indebtedness to the Borrower or
          other persons, or their properties, or first to enforce, realize upon or exhaust
          any collateral security for the Indebtedness, before enforcing this Guaranty. 



             
    (b)       
          So long as any Indebtedness remains outstanding, no Guarantor shall, without the
          prior written consent of the Lender, commence or join with any other Person in
          commencing any Proceeding of or against the Borrower. 



             
    (c)       
          Each Guarantor hereby guarantees that the Indebtedness will be paid to the
          Lender without set-off or counterclaim or other reduction whatsoever (whether
          for taxes, withholdings or otherwise) in lawful currency of the United States at
          the address of the Lender set forth in the Credit Agreement or at such other
          address or to such other account as the Lender may specify in writing to any
          Guarantor. 

–4–




             10.    
          If Payments Set Aside, etc. If any payment applied by the
          Lender to the Indebtedness is thereafter set aside, recovered, rescinded or
          required to be returned for any reason (including, without limitation, the
          bankruptcy, insolvency or reorganization of the Borrower or any other obligor),
          the Indebtedness to which such payment was applied shall for the purpose of this
          Guaranty be deemed to have continued in existence, notwithstanding such
          application, and this Guaranty shall be enforceable as to such Indebtedness as
          fully as if such application had never been made. 



             11.    
          Additional Obligation of Guarantors. Each Guarantor’s
          liability under this Guaranty is in addition to and shall be cumulative with all
          other liabilities of such Guarantor to the Lender as guarantor, surety,
          endorser, accommodation co-obligor or otherwise of any of the Indebtedness or
          obligation of the Borrower, without any limitation as to amount, unless the
          instrument or agreement evidencing or creating such other liability specifically
          provides to the contrary. 



             12.    
          Financial Information. Each Guarantor will deliver to the
          Lender all financial information concerning such Guarantor required to be
          delivered under the Credit Agreement. 



             13.    
          No Duties Owed by Lender. Each Guarantor acknowledges and
          agrees that the Lender: (i) has not made any representations or warranties with
          respect to, (ii) does not assume any responsibility to any Guarantor for, and
          (iii) has no duty to provide information to any Guarantor regarding, the
          enforceability of any of the Indebtedness or the financial condition of the
          Borrower or any guarantor. Each Guarantor has independently determined the
          creditworthiness of the Borrower and the enforceability of the Indebtedness and
          until the Indebtedness is paid in full will independently and without reliance
          on the Lender continue to make such determinations. 



             14.    
          No Fraudulent Conveyance.  Notwithstanding any provision of this
          Guaranty to the contrary, it is intended that this Guaranty, and any liens and
          security interests granted by each Guarantor to secure this Guaranty, not
          constitute a “Fraudulent Conveyance” (as defined below). Consequently,
          each Guarantor agrees that if this Guaranty, or any liens or security interests
          securing this Guaranty, would, but for the application of this sentence,
          constitute a Fraudulent Conveyance, this Guaranty and each such lien and
          security interest shall be valid and enforceable only to the maximum extent that
          would not cause this Guaranty or such lien or security interest to constitute a
          Fraudulent Conveyance, with respect to any Guarantor, and this Guaranty shall
          automatically be deemed to have been amended accordingly at all relevant times,
          with respect to such Guarantor. For purposes hereof, “Fraudulent
          Conveyance” means a fraudulent conveyance under Section 548 of the Code or
          a fraudulent conveyance or fraudulent transfer under the provisions of any
          applicable fraudulent conveyance or fraudulent transfer law or similar law of
          any state, nation or other governmental unit, as in effect from time to time. 



             15.    
          Joint and Several Obligations. Each covenant, agreement,
          obligation, representation and warranty of the Guarantors contained herein
          constitutes the joint and several undertaking of each Guarantor. 



             16.    
          Miscellaneous. This Guaranty shall be effective upon
          delivery to the Lender, without further act, condition or acceptance by the
          Lender, shall be binding upon each Guarantor and the successors and assigns of
          such Guarantor and shall inure to the benefit of the Lender and its
          participants, successors and assigns. No action, failure, delay or omission by
          the Lender in 


–5–




     exercising any rights or remedies hereunder, under the Credit
          Agreement, under any other Loan Document or otherwise, shall constitute a waiver
          of, or impair, any of the rights or privileges of the Lender hereunder. No
          single or partial exercise of any such right or remedy shall preclude any other
          or further exercise thereof or the exercise of any other right or remedy. Such
          rights and remedies are cumulative and not exclusive of any rights and remedies
          provided by law or otherwise available. No waiver of any such right or remedy
          shall be effective unless given in writing by the Lender. No waiver of any right
          or remedy shall be deemed a waiver of any other right or remedy hereunder. This
          Guaranty, together with the other Loan Documents, constitutes the entire
          agreement of the parties on the subject matter hereof and supersedes all prior
          agreements, written or oral, on the subject matter hereof. Any invalidity or
          unenforceability of any provision or application of this Guaranty shall not
          affect other lawful provisions and application thereof, and to this end the
          provisions of this Guaranty are declared to be severable. This Guaranty may not
          be waived, modified, amended, terminated, released or otherwise changed except
          by a writing signed by each Guarantor and the Lender. This Guaranty shall be
          governed by and construed in accordance with the substantive laws (other than
          conflict laws) of the State of New York. Each Guarantor hereby: (i) consents to
          the personal jurisdiction of the state and federal courts located in the State
          of New York in connection with any controversy related to this Guaranty; (ii)
          waives any argument that venue in any such forum is not convenient, (iii) agrees
          that any litigation initiated by the Lender or any Guarantor in connection with
          this Guaranty may be venued in either the state or federal courts located in New
          York County, New York; and (iv) agrees that a final judgment in any such suit,
          action or proceeding shall be conclusive and may be enforced in other
          jurisdictions by suit on the judgment or in any other manner provided by law. 



             17.    
          WAIVER OF PERSONAL SERVICE AND JURY TRIAL. EACH GUARANTOR
          HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS THAT SERVICE
          OF PROCESS UPON ANY GUARANTOR MAY BE MADE BY CERTIFIED OR REGISTERED MAIL,
          RETURN RECEIPT REQUESTED, DIRECTED TO SUCH GUARANTOR AT SUCH GUARANTOR’S
          ADDRESS SET FORTH IN THE CREDIT AGREEMENT, AND SERVICE SO MADE SHALL BE DEEMED
          COMPLETED UPON THE EARLIER OF SUCH GUARANTOR’S ACTUAL RECEIPT THEREOF OR
          TWO (2) DAYS AFTER THE SAME SHALL HAVE BEEN SO MAILED. EACH GUARANTOR HEREBY
          IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
          COUNTERCLAIM ARISING OUT OF, BASED ON OR PERTAINING TO THIS GUARANTY. 







–6–








        IN
WITNESS WHEREOF, this Guaranty has been duly executed by each Guarantor the date first
written above. 


	  	INFOTECH USA, INC., a Delaware corporation 






	 	By: 	  /s/ J. Robert Patterson
 
	 	Name:	 J. Robert Patterson
	 	Title:	 Chief Financial Officer, Vice
 President and Treasurer






	  	INFORMATION TECHNOLOGY SERVICES, INC., a New York
                                                              corporation






	 	By: 	  /s/  J. Robert Patterson
 
	 	Name:	 J. Robert Patterson
	 	Title:	 Chief Financial Officer, Vice
 President and Treasurer