c51356_ex10-4.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing








SUBSIDIARY GUARANTEE


     SUBSIDIARY GUARANTEE, dated as of November 15, 2007 (this “Guarantee”), made by each of the signatories hereto (together with any
other entity that may become a party hereto as provided herein, the “Guarantors”), in favor of the Secured Parties signatory (the “Secured
Parties”) to that certain Loan and Security Agreement, dated as of the date hereof, between Fearless International, Inc. (the “Company”), the
Guarantors and the Secured Parties.


W I T N E S S E T H:


     WHEREAS, pursuant to that certain Loan and Security Agreement, dated as of the date hereof, by and between the Company and the Secured Parties (the “Security
Agreement”), the Company has agreed to sell and issue to the Secured Parties, and the Secured Parties have agreed to purchase from the Company the Company’s Secured Promissory Notes, due March 15, 2008 or such
earlier date as required therein (the “Notes”), subject to the terms and conditions set forth therein; and 


      WHEREAS, each Guarantor will directly benefit from the extension of credit to the Company represented by the issuance of the Notes; and


      NOW, THEREFORE, in consideration of the premises and to induce the Secured Parties to enter into the Security Agreement and to carry out the transactions contemplated thereby, each Guarantor hereby agrees with the Secured Parties
as follows: 


     1.      Definitions. Unless otherwise defined herein, terms defined in the Security Agreement and used herein shall
have the meanings given to them in the Security Agreement. The words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import when used in this Guarantee shall refer to this Guarantee as a
whole and not to any particular provision of this Guarantee, and Section and Schedule references are to this Guarantee unless otherwise specified. The meanings given to terms defined herein shall be equally applicable to both the singular and plural
forms of such terms.  The following terms shall have the following meanings: 




     “Guarantee” means
this Subsidiary Guarantee, as the same may be amended, supplemented or otherwise
modified from time to time. 

      “Obligations” means,
  in addition to all other costs and expenses of collection incurred by Secured
  Parties in enforcing any of such  Obligations and/or this Guarantee, all of the
  liabilities and obligations (primary, secondary, direct, contingent, sole, joint
  or several) due or to become due, or that are now or may be hereafter contracted
  or acquired, or owing to, of any Debtor  to the Secured Parties, including, without
  limitation, all obligations under this Agreement, the Notes, this Guarantee and
  any other instruments, agreements or other documents executed and/or delivered
  in connection herewith or therewith, in each  case,


1












whether now or hereafter existing, voluntary or involuntary,
direct or indirect, absolute or contingent, liquidated or unliquidated, whether
or not jointly owed with others, and whether or not from time to time decreased
or  extinguished and later increased, created or incurred, and all or any portion
of such obligations or liabilities that are paid, to the extent all or any part
of such payment is avoided or recovered directly or indirectly from any of the
Secured  Parties as a preference, fraudulent transfer or otherwise as such obligations
may be amended, supplemented, converted, extended or modified from time to time.
Without limiting the generality of the foregoing, the term “Obligations” shall
 include, without limitation: (i) principal of, and interest on the Notes and
the loans extended pursuant thereto; (ii) any and all other fees, indemnities,
costs, obligations and liabilities of the Debtors from time to time under or
in connection  with this Agreement, the Notes, the Guarantee and any other instruments,
agreements or other documents executed and/or delivered in connection herewith
or therewith; and (iii) all amounts (including but not limited to post-petition
interest) in  respect of the foregoing that would be payable but for the fact
that the obligations to pay such amounts are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar proceeding involving
any Debtor.

     2.      Guarantee. 

     (a)      Guarantee. 

     (i)      The
    Guarantors hereby, jointly and severally, unconditionally and irrevocably,
    guarantee to the Secured Parties and their respective  successors, indorsees,
    transferees and assigns, the prompt and complete payment and performance
    by the Company when due (whether at the stated maturity, by acceleration
    or otherwise) of the Obligations.

     (ii)      Anything
    herein or in any other Transaction Document to the contrary notwithstanding,
    the maximum liability of each Guarantor hereunder  and under the other Transaction
    Documents shall in no event exceed the amount which can be guaranteed by
    such Guarantor under applicable federal and state laws, including laws relating
    to the insolvency of debtors, fraudulent conveyance or transfer  or laws
    affecting the rights of creditors generally (after giving effect to the right
    of contribution established in Section 2(b)).

     (iii)      Each
    Guarantor agrees that the Obligations may at any time and from time to time
    exceed the amount of the liability of such Guarantor  hereunder without impairing
    the guarantee contained in this Section 2 or affecting the rights and remedies
of the Secured Parties hereunder. 

     (iv)      The
    guarantee contained in this Section 2 shall remain in full force and effect
    until all the Obligations and the obligations of each



2












Guarantor under the guarantee contained in this Section 2
shall have been satisfied by payment in full.

     (v)      No
  payment made by the Company, any of the Guarantors, any other guarantor or
    any other Person or received or collected by the Secured Parties from the
    Company, any of the Guarantors, any other guarantor or any other Person by
    virtue of any action or proceeding or any set-off or appropriation or application
    at any time or from time to time in reduction of or in payment of the Obligations
    shall be deemed to modify, reduce, release or otherwise affect the liability
    of any Guarantor hereunder which shall, notwithstanding any such payment
    (other than any payment made by such Guarantor in respect of the Obligations
    or any payment received or collected from such Guarantor in respect of the
    Obligations), remain liable for the Obligations up to the maximum liability
of such Guarantor hereunder until the Obligations are paid in full. 

     (vi)      Notwithstanding
    anything to the contrary in this Agreement, with respect to any defaulted
    non-monetary Obligations the specific  performance of which by the Guarantors
    is not reasonably possible (e.g. the issuance of the Company’s Common
    Stock), the Guarantors shall only be liable for making the Secured Parties
    whole on a monetary basis for the Company’s failure to
perform such Obligations in accordance with the Transaction Documents.

     (b)      Right
  of Contribution. Each Guarantor hereby agrees
  that to the extent that a Guarantor shall have paid more than its proportionate
  share of any payment made hereunder, such Guarantor shall be entitled to seek
  and receive contribution from and against any other Guarantor hereunder which
  has not paid its proportionate share of such payment. Each Guarantor’s
  right of contribution shall be subject to the terms and conditions of Section
  2(c). The provisions of this Section 2(b) shall in no respect limit the obligations
  and liabilities of any Guarantor to the Secured Parties, and each Guarantor
  shall remain liable to the Secured Parties for the full amount guaranteed by
  such Guarantor hereunder. 

     (c)      No
  Subrogation.  Notwithstanding any payment made
  by any Guarantor hereunder or any set-off or application  of funds of any Guarantor
  by the Secured Parties, no Guarantor shall be entitled to be subrogated to
  any of the rights of the Secured Parties against the Company or any other Guarantor
  or any collateral security or guarantee or right of offset held  by the Secured
  Parties for the payment of the Obligations, nor shall any Guarantor seek or
  be entitled to seek any contribution or reimbursement from the Company or any
  other Guarantor in respect of payments made by such Guarantor hereunder, until
   all amounts owing to the Secured Parties by the Company on account of the
  Obligations are paid in full. If any amount shall be paid to any Guarantor
  on account of such subrogation rights at any time when all of the Obligations
  shall not have been  paid in full, such amount shall be held by such Guarantor
  in trust for the Secured Parties,


3












segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Secured Parties
in the exact form received by such Guarantor (duly indorsed by such Guarantor
to the Secured  Parties, if required), to be applied against the Obligations,
whether matured or unmatured, in such order as the Secured Parties may determine. 

     (d)      Amendments,
  Etc. With Respect to the Obligations. Each Guarantor
  shall remain obligated hereunder  notwithstanding that, without any reservation
  of rights against any Guarantor and without notice to or further assent by
  any Guarantor, any demand for payment of any of the Obligations made by the
  Secured Parties may be rescinded by the Secured Parties and any of the Obligations
  continued, and the Obligations, or the liability of any other Person upon or
  for any part thereof, or any collateral security or guarantee therefor or right
  of offset with respect thereto, may, from time to time, in whole or in part,
  be renewed, extended, amended, modified, accelerated, compromised, waived,
  surrendered or released by the Secured Parties, and the Security Agreement
  and the other Transaction Documents and any other documents executed and delivered
  in connection therewith may be amended, modified, supplemented or terminated,
  in whole or in part, as the Secured Parties may deem advisable from time to
  time, and any collateral security, guarantee or right of offset at any time
  held by the Secured Parties for the payment of the Obligations may be sold,
  exchanged, waived, surrendered or released. The Secured Parties shall have
  no obligation to protect, secure, perfect or insure any Lien at any time held
  by them as security for the Obligations or for the guarantee contained in this
  Section 2 or any property subject thereto.

     (e)      Guarantee
  Absolute and Unconditional. Each Guarantor waives
  any and all notice of the creation, renewal,  extension or accrual of any of
  the Obligations and notice of or proof of reliance by the Secured Parties upon
  the guarantee contained in this Section 2 or acceptance of the guarantee contained
  in this Section 2; the Obligations, and any of them,  shall conclusively be
  deemed to have been created, contracted or incurred, or renewed, extended,
  amended or waived, in reliance upon the guarantee contained in this Section
  2; and all dealings between the Company and any of the Guarantors, on the
  one hand, and the Secured Parties, on the other hand, likewise shall be conclusively
  presumed to have been had or consummated in reliance upon the guarantee contained
  in this Section 2. Each Guarantor waives to the extent permitted by law diligence,
   presentment, protest, demand for payment and notice of default or nonpayment
  to or upon the Company or any of the Guarantors with respect to the Obligations.
  Each Guarantor understands and agrees that the guarantee contained in this
  Section 2 shall  be construed as a continuing, absolute and unconditional guarantee
  of payment without regard to (a) the validity or enforceability of the Security
  Agreement or any other Transaction Document, any of the Obligations or any
  other collateral security  therefor or guarantee or right of offset with respect
  thereto at any time or from time to time held by the Secured Parties, (b) any
  defense, set-off or counterclaim (other than a defense of payment or performance


4












or fraud or misconduct by Secured Parties) which may at any
time be available to or be asserted by the Company or any other Person against
the Secured Parties, or (c) any other circumstance whatsoever (with or without
notice to or  knowledge of the Company or such Guarantor) which constitutes,
or might be construed to constitute, an equitable or legal discharge of the Company
for the Obligations, or of such Guarantor under the guarantee contained in this
Section 2, in  bankruptcy or in any other instance. When making any demand hereunder
or otherwise pursuing its rights and remedies hereunder against any Guarantor,
the Secured Parties may, but shall be under no obligation to, make a similar
demand on or otherwise  pursue such rights and remedies as they may have against
the Company, any other Guarantor or any other Person or against any collateral
security or guarantee for the Obligations or any right of offset with respect
thereto, and any failure by the  Secured Parties to make any such demand, to
pursue such other rights or remedies or to collect any payments from the Company,
any other Guarantor or any other Person or to realize upon any such collateral
security or guarantee or to exercise any  such right of offset, or any release
of the Company, any other Guarantor or any other Person or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not  impair or affect the rights
and remedies, whether express, implied or available as a matter of law, of the
Secured Parties against any Guarantor. For the purposes hereof, “demand” shall
include the commencement and continuance of any legal  proceedings. 

     (f)      Reinstatement.
  The guarantee contained in this Section 2 shall continue to be effective, or
  be reinstated,  as the case may be, if at any time payment, or any part thereof,
  of any of the Obligations is rescinded or must otherwise be restored or returned
  by the Secured Parties upon the insolvency, bankruptcy, dissolution, liquidation
  or reorganization of  the Company or any Guarantor, or upon or as a result
    of the appointment of a receiver, intervenor or conservator of, or trustee
    or similar officer for, the Company or any Guarantor or any substantial part
    of its property, or otherwise, all as though such payments had not been made. 

     (g)      Payments.
    Each Guarantor hereby guarantees that payments hereunder will be paid to
    the Secured Parties  without set-off or counterclaim in U.S. dollars at the
    address set forth or referred to in the Security Agreement. 


     3.      Representations and Warranties. Each Guarantor hereby makes the following representations and warranties to
Secured Parties as of the date hereof: 


     (a)      Organization and Qualification. The Guarantor is a corporation, duly incorporated, validly existing and in
good standing under the laws of the applicable jurisdiction set forth on Schedule 1, with the requisite corporate power and authority to own and use its properties and assets and to carry on its business as currently conducted. The Guarantor has no
subsidiaries other than those identified as such on the Disclosure Schedules to the Security Agreement. The


5












Guarantor is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the nature of
the business conducted or property owned by it makes such qualification necessary,
except  where the failure to be so qualified or in good standing, as the case
may be, could not, individually or in the aggregate, (x) adversely affect the
legality, validity or enforceability of any of this Guaranty in any material
respect, (y) have a  material adverse effect on the results of operations, assets,
prospects, or financial condition of the Guarantor or (z) adversely impair in
any material respect the Guarantor’s ability to perform fully on a timely
basis its obligations under  this Guaranty (a “Material
Adverse Effect”). 

     (b)      Authorization;
  Enforcement.  The Guarantor has the requisite
  corporate power and authority to enter into and to consummate the transactions
  contemplated by this Guaranty, and otherwise to carry out its obligations hereunder.
  The execution and delivery of this Guaranty by the Guarantor and the consummation
  by it of the transactions contemplated hereby have been duly authorized by
  all requisite corporate action on the part of the Guarantor. This Guaranty
  has been duly executed and delivered by the Guarantor and constitutes the valid
  and binding obligation of the Guarantor enforceable against the Guarantor in
  accordance with its terms, except as such enforceability may be limited by
  applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
  or similar laws relating to, or affecting generally the enforcement of, creditors’ rights
  and remedies or by other equitable principles of general application. 

     (c)      No
  Conflicts. The execution, delivery and performance
  of this Guaranty by the Guarantor and the  consummation by the Guarantor of
  the transactions contemplated thereby do not and will not (i) conflict with
  or violate any provision of its Certificate of Incorporation or By-laws or
  (ii) conflict with, constitute a default (or an event which with  notice or
  lapse of time or both would become a default) under, or give to others any
  rights of termination, amendment, acceleration or cancellation of, any agreement,
  indenture or instrument to which the Guarantor is a party, or (iii) result
  in a  violation of any law, rule, regulation, order, judgment, injunction,
  decree or other restriction of any court or governmental authority to which
  the Guarantor is subject (including Federal and state securities laws and regulations),
  or by which any  material property or asset of the Guarantor is bound or affected,
  except in the case of each of clauses (ii) and (iii), such conflicts, defaults,
  terminations, amendments, accelerations, cancellations and violations as could
  not, individually or in  the aggregate, have or result in a Material Adverse
  Effect. The business of the Guarantor is not being conducted in violation of
  any law, ordinance or regulation of any governmental authority, except for
  violations which, individually or in the  aggregate, do not have a Material
  Adverse Effect. 

     (d)      Consents
  and Approvals. The Guarantor is not required
  to obtain any consent, waiver, authorization or  order of, or make any filing
  or registration


6












with, any court or other federal, state, local, foreign or
other governmental authority or other person in connection with the execution,
delivery and performance by the Guarantor of this Guaranty. 

     (e)      Security
  Agreement. The representations and warranties
  of the Company set forth in the Security Agreement as they relate to such Guarantor,
  each of which is hereby incorporated herein by reference, are true and correct
  as of each time such representations are deemed to be made pursuant to such
  Security Agreement, and the Secured Parties shall be entitled to rely on each
  of them as if they were fully set forth herein, provided that each reference
  in each such representation and warranty to the Company’s knowledge shall,
  for the purposes of this Section 3, be deemed to be a reference to such Guarantor’s
  knowledge.

     (f)      Foreign
  Law.  Each Guarantor has consulted with appropriate
  foreign legal counsel with respect to any of  the above representations for
  which non-U.S. law is applicable. Such foreign counsel have advised each applicable
  Guarantor that such counsel knows of no reason why any of the above representations
  would not be true and accurate. Such foreign  counsel were provided with copies
  of this Subsidiary Guarantee and the Transaction Documents prior to rendering
  their advice.


     4.      Covenants.


     (a)      Each
Guarantor covenants and agrees with the Secured Parties that, from and after
the date of this Guarantee until the Obligations shall  have been paid in full,
such Guarantor shall take, and/or shall refrain from taking, as the case may
be, each commercially reasonable action that is necessary to be taken or not
taken, as the case may be, so that no Event of Default is caused by the  failure
to take such action or to refrain from taking such action by such Guarantor.

     (b)      Each
Guarantor will not directly or indirectly on or after the date of this Guarantee: 

     i.      enter
  into, create, incur, assume or suffer to exist any indebtedness for borrowed
  money of any kind, including but not limited to, a  guarantee, on or with respect
  to any of its property or assets now owned or hereafter acquired or any interest
  therein or any income or profits therefrom; 

     ii.      enter
  into, create, incur, assume or suffer to exist any liens of any kind, on or
  with respect to any of its property or assets now owned or hereafter acquired
  or any interest therein or any income or profits therefrom; 


7












     iii.      amend
its certificate of incorporation, bylaws or other charter documents so as to
adversely affect any rights of the Holder hereunder; 

      iv.      repay,
  repurchase or offer to repay, repurchase or otherwise acquire more than a de
  minimis number of shares of its securities or debt  obligations;

     v.      pay
  cash dividends on any equity securities of the Company; 

     vi.      enter
  into any transaction with any Affiliate of the Guarantor which would be required
  to be disclosed in any public filing of the Company  with the Commission, unless
  such transaction is made on an arm’s-length basis and expressly approved
  by a majority of the disinterested directors of the Company (even if less than
  a quorum otherwise required for board approval); or 

     vii.      enter
  into any agreement with respect to any of the foregoing. 


     5.      Miscellaneous. 


     (a)      Amendments
in Writing. None of the terms or provisions of
this Guarantee may be waived, amended,  supplemented or otherwise modified except
in writing by the Secured Parties. 

     (b)      Notices.
  All notices, requests and demands to or upon the Secured Parties or any Guarantor
  hereunder shall  be effected in the manner provided for in the Security Agreement. 

     (c)      No
  Waiver By Course Of Conduct; Cumulative Remedies.
  The Secured Parties shall not by any act (except by a  written instrument pursuant
  to Section 5(a)), delay, indulgence, omission or otherwise be deemed to have
  waived any right or remedy hereunder or to have acquiesced in any default under
  the Transaction Documents or Event of Default. No failure to  exercise, nor
  any delay in exercising, on the part of the Secured Parties, any right, power
  or privilege hereunder shall operate as a waiver thereof. No single or partial
  exercise of any right, power or privilege hereunder shall preclude any other
   or further exercise thereof or the exercise of any other right, power or privilege.
  A waiver by the Secured Parties of any right or remedy hereunder on any one
  occasion shall not be construed as a bar to any right or remedy which the Secured
  Parties  would otherwise have on any future occasion. The rights and remedies
  herein provided are cumulative, may be exercised singly or concurrently and
  are not exclusive of any other rights or remedies provided by law. 


8












     (d)      Enforcement
Expenses; Indemnification. 

     (i)      Each
  Guarantor agrees to pay, or reimburse the Secured Parties for, all its costs
  and expenses incurred in collecting against such  Guarantor under the guarantee
  contained in Section 2 or otherwise enforcing or preserving any rights under
  this Guarantee and the other Transaction Documents to which such Guarantor
    is a party, including, without limitation, the reasonable fees and disbursements
  of counsel to the Secured Parties. 

     (ii)      Each
  Guarantor agrees to pay, and to save the Secured Parties harmless from, any
  and all liabilities with respect to, or resulting from  any delay in paying,
  any and all stamp, excise, sales or other taxes which may be payable or determined
  to be payable in connection with any of the transactions contemplated by this
  Guarantee. 

     (iii)      Each
  Guarantor agrees to pay, and to save the Secured Parties harmless from, any
  and all liabilities, obligations, losses, damages,  penalties, actions, judgments,
  suits, costs, expenses or disbursements of any kind or nature whatsoever with
  respect to the execution, delivery, enforcement, performance and administration
  of this Guarantee to the extent the Company would be  required to do so pursuant
  to the Security Agreement. 

     (iv)      The
  agreements in this Section shall survive repayment of the Obligations and all
  other amounts payable under the Security Agreement and  the other Transaction
  Documents.

     (e)      Successor
  and Assigns. This Guarantee shall be binding
  upon the successors and assigns of each Guarantor  and shall inure to the benefit
  of the Secured Parties and their respective successors and assigns; provided
  that no Guarantor may assign, transfer or delegate any of its rights or obligations
  under this Guarantee without the prior written consent of  the Secured Parties. 

     (f)      Set-Off.
  Each Guarantor hereby irrevocably authorizes the Secured Parties at any time
  and from time to  time while an Event of Default under any of the Transaction
  Documents shall have occurred and be continuing, without notice to such Guarantor
  or any other Guarantor, any such notice being expressly waived by each Guarantor,
  to set-off and  appropriate and apply any and all deposits, credits, indebtedness
  or claims, in any currency, in each case whether direct or indirect, absolute
  or contingent, matured or unmatured, at any time held or owing by the Secured
  Parties to or for the  credit or the account of such Guarantor, or any part
  thereof in such amounts as the Secured Parties may elect, against and on account
  of the obligations and liabilities of such Guarantor to the Secured Parties
  hereunder and claims of every nature  and description of the Secured Parties
  against such Guarantor, in any currency, whether arising hereunder, under the


9












Security Agreement, any other Transaction Document or otherwise,
as the Secured Parties may elect, whether or not the Secured Parties have made
any demand for payment and although such obligations, liabilities and claims
may be  contingent or unmatured. The Secured Parties shall notify such Guarantor
promptly of any such set-off and the application made by the Secured Parties
of the proceeds thereof, provided that the failure to give such notice shall
not affect the  validity of such set-off and application. The rights of the Secured
Parties under this Section are in addition to other rights and remedies(including,
without limitation, other rights of set-off) which the Secured Parties may have. 

     (g)      Counterparts.
  This Guarantee may be executed by one or more of the parties to this Guarantee
  on any number  of separate counterparts (including by telecopy), and all of
    said counterparts taken together shall be deemed to constitute one and the
    same instrument.

     (h)      Severability.
    Any provision of this Guarantee which is prohibited or unenforceable in any
    jurisdiction  shall, as to such jurisdiction, be ineffective to the extent
    of such prohibition or unenforceability without invalidating the remaining
    provisions hereof, and any such prohibition or unenforceability in any jurisdiction
    shall not invalidate or  render unenforceable such provision in any other
    jurisdiction.

     (i)      Section
    Headings. The Section headings used in this
    Guarantee are for convenience of reference only and  are not to affect the
    construction hereof or be taken into consideration in the interpretation
    hereof. 

     (j)      Integration.
    This Guarantee and the other Transaction Documents represent the agreement
    of the Guarantors  and the Secured Parties with respect to the subject matter
    hereof and thereof, and there are no promises, undertakings, representations
    or warranties by the Secured Parties relative to subject matter hereof and
    thereof not expressly set forth or  referred to herein or in the other Transaction
    Documents. 

     (k)      Governing
    Law. THIS GUARANTEE SHALL BE GOVERNED BY, AND
    CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE  LAW OF THE STATE OF NEW
    YORK WITHOUT REGARD TO ANY PRINCIPLES OF CONFLICTS OF LAWS.

     (l)      Submission
    to Jurisdictional; Waiver. Each Guarantor hereby
    irrevocably and unconditionally: 

     (i)      submits
    for itself and its property in any legal action or proceeding relating to
    this Guarantee and the other Transaction Documents to  which it is a party,
    or for recognition and enforcement of any judgment in respect thereof, to
    the non-exclusive general jurisdiction of the Courts of the State of New
    York, located in New York County, New


10












York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;

     (ii)      consents
  that any such action or proceeding may be brought in such courts and waives
    any objection that it may now or hereafter have to the venue of any such
    action or proceeding in any such court or that such action or proceeding
    was brought in an inconvenient court and agrees not to plead or claim the
    same;

     (iii)      agrees
    that service of process in any such action or proceeding may be effected
    by mailing a copy thereof by registered or certified mail  (or any substantially
    similar form of mail), postage prepaid, to such Guarantor at its address
    referred to in the Security Agreement or at such other address of which the
    Secured Parties shall have been notified pursuant thereto; 

     (iv)      agrees
    that nothing herein shall affect the right to effect service of process in
    any other manner permitted by law or shall limit the  right to sue in any
    other jurisdiction; and

     (v)      waives,
    to the maximum extent not prohibited by law, any right it may have to claim
    or recover in any legal action or proceeding referred  to in this Section
    any special, exemplary, punitive or consequential damages.

(m)      Acknowledgements.
      Each Guarantor hereby acknowledges that: 

     (i)      it
      has been advised by counsel in the negotiation, execution and delivery
      of this Guarantee and the other Transaction Documents to which it  is a
      party;

     (ii)      the
      Secured Parties have no fiduciary relationship with or duty to any Guarantor
      arising out of or in connection with this Guarantee or  any of the other
      Transaction Documents, and the relationship between the Guarantors, on
      the one hand, and the Secured Parties, on the other hand, in connection
      herewith or therewith is solely that of debtor and creditor; and

     (iii)      no
      joint venture is created hereby or by the other Transaction Documents or
      otherwise exists by virtue of the transactions contemplated  hereby among
      the Guarantors and the Secured Parties.

     (n)      Additional
      Guarantors.  The Company shall cause each
      of its subsidiaries formed or acquired on or  subsequent to the date hereof
      to become a 


11












Guarantor for all purposes of this Guarantee by executing
and delivering an Assumption Agreement in the form of Annex 1 hereto. 

     (o)      Release
  of Guarantors. Subject to Section 2.6, each Guarantor
  will be released from all liability  hereunder concurrently with the repayment
  in full of all amounts owed under the Security Agreement, the Notes and the
  other Transaction Documents.

     (p)      Seniority.
  The Obligations of each of the Guarantors hereunder rank senior in priority
  to any other  Indebtedness (as defined in the Security Agreement) of such Guarantor.

     (q)      Waiver
  of Jury Trial. EACH GUARANTOR AND, BY
  ACCEPTANCE OF THE BENEFITS HEREOF,  THE SECURED PARTIES, HEREBY IRREVOCABLY
  AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
  TO THIS GUARANTEE AND FOR ANY COUNTERCLAIM THEREIN. 


****************

 

 

12











     IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee to be duly executed and delivered as of the date first above written. 

	 	
FEARLESS YACHTS LLC, a Missouri Limited Liability Corporation	
	 	 	 

	
	 	By:  	
  

	 	 	
           Name:
	
	 	 	
           Title:
	




 

13











SCHEDULE 1 



GUARANTORS


     The following are the names, notice addresses and jurisdiction of organization of each Guarantor. 

	 

		 
		 

		 
		
COMPANY
		 

	
	 

		 
		
JURISDICTION OF
		 
		
OWNED BY
		 

	
	 

		 
		
INCORPORATION
		 
		
PERCENTAGE
		 

	
	 

		 
		
-------------
		 
		
----------
		 

	
	 

	
	
Fearless Yachts LLC
		 
		
Missouri
		 
		
100%
		 
	
	
----------
		 
		 

		 
		 

		 

	




 

 

14











Annex 1 to 

SUBSIDIARY GUARANTEE 


ASSUMPTION AGREEMENT, dated as of ____ __, ______
made by
______________________________, a
______________
corporation (the “Additional
Guarantor”), in favor of the Secured Parties pursuant to the Security Agreement referred to below. All capitalized terms not defined herein shall have the meaning ascribed to them in
such Security Agreement.


W I T N E S S E T H :


     WHEREAS, [COMPANY], a [___________
corporation (the “Company”)
and the Secured Parties have entered into a Securities Security Agreement, dated
as of [________
___, 2007 (as amended, supplemented or otherwise modified from time to time,
the “Security Agreement”);


     WHEREAS, in connection with
the Security Agreement, the Company and its Subsidiaries (other than the Additional
Guarantor) have entered into the Subsidiary Guarantee, dated as of [______________
____, 2007 (as amended, supplemented or otherwise modified from time to time,
the “Guarantee”) in favor of the Secured Parties;


     WHEREAS, the Security Agreement requires the Additional Guarantor to become a party to the Guarantee; and 


     WHEREAS, the Additional Guarantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guarantee; 


NOW, THEREFORE, IT IS AGREED:


     1.      Guarantee. By executing and delivering this Assumption Agreement, the Additional Guarantor, as provided in
Section 5(n) of the Guarantee, hereby becomes a party to the Guarantee as a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly
assumes all obligations and liabilities of a Guarantor thereunder. The information set forth in Annex 1-A hereto is hereby added to the information set forth in Schedule 1 to the Guarantee. The Additional Guarantor hereby represents and warrants
that each of the representations and warranties contained in Section 3 of the Guarantee is true and correct on and as the date hereof as to such Additional Guarantor (after giving effect to this Assumption Agreement) as if made on and as of such
date. 


     2.      Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK. 


15












     IN WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above written. 

	 	
      [ADDITIONALGUARANTOR]	
	 	 	 

	
	 	By:  	 

	 	
      Name:	
	 	
      Title:	





16