Unassociated Document


    Exhibit
      10.2

       

      GUARANTY
        AGREEMENT

       

      This
        continuing Guaranty Agreement (“Guaranty”)
        is
        entered into as of February 26th,
        2008,
        by DOUGLAS
        J. WOOD
        (“Guarantor”),
        in
        favor of SILICON
        VALLEY BANK (“Bank”).

       

      RECITALS

       

      A. Concurrently
        herewith. Bank and GPS Industries, Inc., a Nevada corporation (“Borrower”)
        are
        entering into that certain Loan and Security Agreement dated of even date
        herewith (as amended, restated, or otherwise modified from time to time,
        me
“Loan
        Agreement”)
        pursuant to which Bank has agreed to make certain advances of money and to
        extend certain financial accommodations to Borrower (collectively, the
“Loans”),
        subject to the terms and conditions set forth therein. Capitalized terms
        used
        but not otherwise defined herein shall have the meanings given them in the
        Loan
        Agreement.

       

      B. In
        consideration of the agreement of Bank to make the Loans to Borrower under
        the
        Loan Agreement, Guarantor is willing to guaranty the full payment and
        performance by Borrower of all of its obligations thereunder and under the
        other
        Loan Documents, all as further set forth herein.

       

      C. Guarantor
        is the Chief Executive Officer of Borrower and will obtain substantial direct
        and indirect benefit from the Loans made by Bank to Borrower under the Loan
        Agreement.

       

      Now,
        THEREFORE,
        to
        induce Bank to enter into the Loan Agreement, and for other good and valuable
        consideration, the receipt and adequacy of which are hereby acknowledged,
        and
        intending to be legally bound, Guarantor hereby represents, warrants, covenants
        and agrees as follows:

       

      Section
        1. Guaranty.

       

      1.1 Unconditional
        Guaranty of Payment.
        In
        consideration of the foregoing. Guarantor hereby irrevocably, absolutely
        and
        unconditionally guarantees to Bank the prompt and complete payment and
        performance when due (whether at stated maturity, by acceleration or otherwise)
        of all Obligations; provided, however, the maximum liability of Guarantor
        hereunder shall not exceed at any time the sum of (a) principal
        indebtedness of Borrower to Bank in the amount of $1,500,000, plus (b) all
        accrued and unpaid interest on such principal indebtedness, plus (c) all
        Bank Expenses. Guarantor agrees that it shall execute such other documents
        or
        agreements and take such action as Bank shall reasonably request to effect
        the
        purposes of this Guaranty.

       

      1.2 Separate
        Obligations.
        These
        obligations are independent of Borrower’s obligations and separate actions may
        be brought against Guarantor (whether action is brought against Borrower
        or
        whether Borrower is joined in the action).

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Section
        2. Representations
        and Warranties.

       

      Guarantor
        hereby represents and warrants that:

       

      (a) The
        execution, delivery and performance by Guarantor of this Guaranty (i) do
        not contravene any law or any contractual restriction binding on or affecting
        Guarantor or by which Guarantor’s property may be affected; (ii) do not
        require any authorization or approval or other action by, or any notice to
        or
        filing with, any governmental authority or any other Person under any indenture,
        mortgage, deed of trust, lease, agreement or other instrument to which Guarantor
        is a party or by which Guarantor or any of its property is bound, except
        such as
        have been obtained or made; and (iii) do not result in the imposition or
        creation of any Lien upon any property of Guarantor.

       

      (b) Guarantor
        is legally competent to execute, deliver and perform this Guaranty.

       

      (c) This
        Guaranty is a valid and binding obligation of Guarantor, enforceable against
        Guarantor in accordance with its terms, except as the enforceability thereof
        may
        be subject to or limited by bankruptcy, insolvency, reorganization, arrangement,
        moratorium or other similar laws relating to or affecting the rights of
        creditors generally.

       

      (d) There
        is
        no action, suit or proceeding affecting Guarantor pending or threatened before
        any court, arbitrator, or governmental authority, domestic or foreign, which
        may
        have a material adverse effect on the ability of Guarantor to perform its
        obligations under this Guaranty.

       

      (e) Guarantor’s
        obligations hereunder are not subject to any offset or defense against Bank
        or
        Borrower of any kind.

       

      (f) The
        personal financial statements as of Jan 2008 for Guarantor and the U.S. federal
        2006 tax returns of Guarantor, copies of which have been furnished to Bank,
        fairly present the financial position of Guarantor for the dates and periods
        purported to be covered thereby, and there has been no material adverse change
        in the financial position of Guarantor since the date of such personal financial
        statements and tax returns.

       

      (g) Neither
        Guarantor nor its property has any immunity from jurisdiction of any court
        or
        from any legal process (whether through service or notice, attachment prior
        to
        judgment, attachment in aid of execution, execution or otherwise) under
        applicable law.

       

      (h) The
        incurrence of Guarantor’s obligations under this Guaranty will not cause
        Guarantor to (i) become insolvent; (ii) be left with unreasonably
        small capital for any business or transaction in which Guarantor is presently
        engaged or plans to be engaged; or (iii) be unable to pay its debts as such
        debts mature.

       

      (i) Guarantor
        covenants, warrants, and represents to Bank that all representations and
        warranties contained in this Guaranty shall be true at the time of Guarantor’s
        execution of this Guaranty, and shall continue to be true so long as this
        Guaranty remains in effect. Guarantor expressly agrees that any
        misrepresentation or breach of any warranty whatsoever contained in this
        Guaranty shall be deemed material.

       

      
        
          
          

        

        
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      Section
        3. General
        Waivers. Guarantor waives:

       

      (a) Any
        right
        to require Bank to (i) proceed against Borrower or any other person;
        (ii) proceed against or exhaust any security or (iii) pursue any other
        remedy. Bank may exercise or not exercise any right or remedy it has against
        Borrower or any security it holds (including the right to foreclose by judicial
        or nonjudicial sale) without affecting Guarantor’s liability
        hereunder.

       

      (b) Any
        defenses from disability or other defense of Borrower or from tile cessation
        of
        Borrowers liabilities.

       

      (c) Any
        setoff, defense or counterclaim against Bask.

       

      (d) Any
        defense from the absence, impairment or loss of any right of reimbursement
        or
        subrogation or any other rights against Borrower, Until Borrower’s obligations
        to Bank have been paid. Guarantor has no right of subrogation or reimbursement
        or other rights against Borrower.

       

      (e) Any
        right
        to enforce any remedy that Bank has against Borrower.

       

      (f) Any
        rights to participate in any security held by Bank.

       

      (g) Any
        demands for performance, notices of nonperformance or of new or additional
        indebtedness incurred by Borrower to Bank, Guarantor is responsible for being
        and keeping itself informed of Borrower’s financial condition.

       

      (h) The
        benefit of any act or omission by Bank which directly or indirectly results
        in
        or aids the discharge of Borrower from any of the Obligations by operation
        of
        law or otherwise.

       

      Section
        4. Real
        Property Security Waiver.
        Guarantor acknowledges that, to the extent Guarantor has or may have rights
        of
        subrogation or reimbursement against Borrower for claims arising out of this
        Guaranty, those rights may be impaired or destroyed if Bank elects to proceed
        against any real property security of Borrower by non-judicial foreclosure.
        That
        impairment or destruction could, under certain judicial cases and based on
        equitable principles of estoppel, give rise to a defense by Guarantor against
        its obligations under this Guaranty. Guarantor waives that defense and any
        others arising from Bank’s election to pursue non-judicial foreclosure.
        Guarantor waives the benefits, if any, of any statutory or common law rule
        that
        may permit a subordinating creditor to assert any defenses of a surety or
        guarantor, or that may give the subordinating creditor the right to require
        a
        senior creditor to marshal assets, and Guarantor agrees that it shall not
        assert
        any such defenses or rights.

       

      Section
        5. Reinstatement.
        Notwithstanding any provision of the Loan Agreement to the contrary, the
        liability of Guarantor hereunder shall be reinstated and revived and the
        rights
        of Bank shall continue if and to the extent that for any reason any payment
        by
        or on behalf of Guarantor or Borrower is rescinded or must be otherwise restored
        by Bank, whether as a result of any proceedings in bankruptcy or reorganization
        or otherwise, all as though such amount had not been paid. The determination
        as
        to whether any such payment must be rescinded or restored shall be made by
        Bank
        in its sole discretion; provided, however, that if Bank chooses to contest
        any
        such matter at the request of Guarantor, Guarantor agrees to indemnify and
        hold
        harmless Bank from all costs and expenses (including, without limitation,
        reasonable attorneys’ fees) of such litigation. To the extent any payment is
        rescinded or restored. Guarantor’s obligations hereunder shall be revived in mil
        force and effect without reduction or discharge for that payment.

       

      
        
          
          

        

        
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      Section
        6. No
        Waiver; Amendments.
        No
        failure on the part of Bank to exercise, no delay in exercising and no course
        of
        dealing with respect to, any right hereunder shall operate as a waiver thereof;
        nor shall any single or partial exercise of any right hereunder preclude
        any
        other or further exercise thereof or the exercise of any other right. The
        remedies herein provided are cumulative and not exclusive of any remedies
        provided by law. This Guaranty may not be amended or modified except by written
        agreement between Guarantor and Bank, and no consent or waiver hereunder
        shall
        be valid unless in writing and signed by Bank.

       

      Section
        7. Compromise
        and Settlement.
        No
        compromise, settlement, release, renewal, extension, indulgence, change in,
        waiver or modification of any of the Obligations or the release or discharge
        of
        Borrower from the performance of any of the Obligations shall release or
        discharge Guarantor from this Guaranty or the performance of the obligations
        hereunder.

       

      Section
        8. Notice.
        Any
        notice or other communication herein required or permitted to be given shall
        be
        in writing and may be delivered in person or sent by facsimile transmission,
        overnight courier, or by United States mail, registered or certified, return
        receipt requested, postage prepaid and addressed as follows:

       

      
        	If
                to Guarantor:	
                Douglas J. Wood

                 

              
	 	Tel: 724-520-3080
                Fax: 724-520-3091

              
	 	 
	
                If
                  to Bank:

              	
                Silicon
                  Valley Bank

                7000
                  N. MoPac Expressway, Suite 360

                Austin,
                  TX 78731

                Attn: Phillip
                  Wright

                Fax: 512-794-0855

                Email: pwright@svbank.com

              


      

      


      or
        at
        such other address as may be substituted by notice given as herein provided.
        Every notice, demand, request, consent, approval, declaration or other
        communication hereunder shall be deemed to have been duly given or served
        on the
        date on which personally delivered or sent by facsimile transmission or
        three (3) Business Days after the same shall have been deposited in tile
        United States mail. If sent by overnight courier service, the date of delivery
        shall be deemed to be the next Business Day after deposited with such
        service.

       

      
        
          
          

        

        
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      Section
        9. Entire
        Agreement.
        This
        Guaranty constitutes and contains the entire agreement of the parties and
        supersedes any and all prior and contemporaneous agreements, negotiations,
        correspondence, understandings and communications between Guarantor and Bank,
        whether written or oral, respecting the subject matter hereof.

       

      Section
        10. Severability.
        If any
        provision of this Guaranty is held to be unenforceable under applicable law
        for
        any reason, it shall be adjusted, if possible, rather than voided in order
        to
        achieve the intent of Guarantor and Bank to the extent possible. In any event,
        all other provisions of this Guaranty shall be deemed valid and enforceable
        to
        the full extent possible under applicable law,

       

      Section
        11. Subordination
        of Indebtedness.
        Any
        indebtedness or other obligation of Borrower now or hereafter held by or
        owing
        to Guarantor is hereby subordinated in time and right of payment to all
        obligations of Borrower to Bank, except as such indebtedness or other obligation
        is expressly permitted to be paid under the Credit Agreement; and such
        indebtedness of Borrower to Guarantor is assigned to Bank as security for
        this
        Guaranty, and if Bank so requests shall be collected, enforced and received
        by
        Guarantor in trust for Bank and to be paid over to Bank on account of the
        Obligations of Borrower to Bank, but without reducing or affecting in any
        manner
        the liability of Guarantor under the other provisions of this Guaranty, Any
        notes now or hereafter evidencing such indebtedness of Borrower to Guarantor
        shall be marked with a legend that the same are subject to this
        Guaranty.

       

      Section
        12. Business
        Debt.
        Guarantor hereby represents and agrees (hat none of the Obligations and none
        of
        Guarantor’s obligations hereunder are consumer debt, or were or shall be
        incurred by Borrower or Guarantor, respectively, primarily for personal,
        family
        or household purposes. Guarantor farther agrees and represents that the
        Obligations are and shall be incurred by Borrower, and the obligations of
        Guarantor hereunder are and shall be incurred by Guarantor, for business
        and
        commercial purposes only.

       

      Section
        13. Separate
        Property.
        Notwithstanding anything to the contrary contained herein. Guarantor hereby
        expressly agrees that recourse may be had against Guarantor’s separate property
        for the payment and performance of Guarantor’s obligations
        hereunder.

       

      Section
        14. Payment
        of Expenses.
        Guarantor shall pay, promptly on demand, all Expenses incurred by Bank in
        defending and/or enforcing this Guaranty. For purposes hereof, “Expenses” shall
        mean costs and expenses (including reasonable fees and disbursements of any
        law
        firm or other external counsel and the allocated cost of internal legal services
        and all disbursements of internal counsel) for defending and/or enforcing
        tins
        Guaranty (including those incurred in connection with appeals or proceedings
        by
        or against any Guarantor under the United States Bankruptcy Code, or any
        other
        bankruptcy or insolvency law, including assignments for (he benefit of
        creditors, compositions, extensions generally with its creditors, or proceedings
        seeking reorganization, arrangement, or other relief).

       

      Section
        15. Assignment;
        Governing Law.
        This
        Guaranty shall be binding upon and inure to the benefit of Guarantor and
        Bank
        and their respective successors and assigns, except that Guarantor shall
        not
        have the right to assign its rights hereunder or any interest herein without
        the
        prior written consent of Bank, which may be granted or withheld in Bank’s sole
        discretion. Any such purported assignment by Guarantor without Bank’s written
        consent shall be void. This Guaranty shall be governed by, and construed
        in
        accordance with, the laws of the State of Texas without regard to principles
        thereof regarding conflict of laws.

       

      
        
          
          

        

        
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      Section
        16. PERSONAL
        JURISDICTION.
        GUARANTOR HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR PROCEEDING WITH
        RESPECT TO THIS GUARANTY OR ANY OF THE AGREEMENTS, DOCUMENTS OR INSTRUMENTS
        DELIVERED IN CONNECTION HEREWITH MAY BE BROUGHT IN THE STATE AND FEDERAL
        COURTS
        LOCATED IN THE STATE OF TEXAS AS BANK MAY ELECT (PROVIDED THAT GUARANTOR
        ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A
        COURT
        LOCATED OUTSIDE OF THE STATE OF TEXAS), AND, BY EXECUTION AND DELIVERY HEREOF,
        GUARANTOR ACCEPTS AND CONSENTS TO, GENERALLY AND UNCONDITIONALLY, THE
        JURISDICTION OF THE AFORESAID COURTS AND AGREES THAT SUCH JURISDICTION SHALL
        BE
        EXCLUSIVE, UNLESS WAIVED BY BANK IN WRITING, WITH RESPECT TO ANY ACTION OR
        PROCEEDING BROUGHT BY GUARANTOR AGAINST BANK. NOTHING HEREIN SHALL LIMIT
        THE
        RIGHT OF BANK TO BRING PROCEEDINGS AGAINST GUARANTOR IN THE COURTS OF ANY
        OTHER
        JURISDICTION. GUARANTOR HEREBY WAIVES, TO THE FULL EXTENT PERMITTED BY LAW,
        ANY
        RIGHT TO STAY OR TO DISMISS ANY ACTION OR PROCEEDING BROUGHT BEFORE SAID
        COURTS
        ON THE BASIS OF FORUM NON CONVENIENS.

       

      Section
        17. WAIVER
        OF JURY TRIAL.
        EACH OF
        BANK AND GUARANTOR HEREBY WAIVES, TO THE FULL EXTENT PERMITTED BY APPLICABLE
        LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION
        DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
        GUARANTY. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
        ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
        SUCH
        OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
        WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HERETO HAVE BEEN
        INDUCED TO ENTER INTO THIS GUARANTY AND ANY RELATED INSTRUMENTS, AS APPLICABLE,
        BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
        SECTION 17.

       

      
        	 	
                GUARANTOR

                 

                 

              
	 	DOUGLAS
                J. WOOD


      

      


      
        
          
          

        

        
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