Form of Guaranty of Deer Valley Corporation and Textron Financial


     

    EXHIBIT
      10.31

     

    
       

      TEXTRON
        FINANCIAL

      Textron
        Financial Corporation, Subsidiary of Textron Inc.

       

       
GUARANTY

     

    This
      Guaranty is executed as of February 7,
      2007
      by the undersigned guarantor(s) (individually and collectively, "Guarantor")
      in
      favor of Textron Financial Corporation ("TFC") and each of TFC's affiliates
      (individually and collectively, "Textron"). For purposes of this Guaranty,
      any
      party which controls TFC, is controlled by TFC, or is under common control
      with
      TFC, shall be deemed an affiliate of TFC.

     

    RECITALS

    A. Textron
      may, from time to time, enter into agreements with Deer
      Valley Homebuilders, Inc. (Individually
      or collectively "Obligor");

     

    B. Textron
      is unwilling to enter into agreements with Obligor, unless Guarantor
      unconditionally guarantees to Textron the payment and/or performance of all
      obligations of Obligor at any time owing to Textron.

    AGREEMENT

     

    With
      knowledge that Textron will enter into agreements with Obligor in reliance
      upon
      the existence of this Guaranty, Guarantor agrees with Textron as
      follows:

    


    1. Guaranty.
      Guarantor unconditionally and irrevocably guarantees to Textron (except as
      hereinafter expressly provided as to revocability), without off-set or
      deduction, the prompt payment andfar performance of all indebtedness,
      obligations and liabilities of Obligor at any time owing to Textron, whether
      direct or indirect, matured or unmatured, primary or secondary, or certain
      or
      contingent (individually, a "Guaranteed
      Obligation" and, collectively, the "Guaranteed Obligations"), This Guaranty
      is a
      guaranty of payment and not a guaranty of collection. Guarantor guarantees
      to
      Textron the punctual and faithful performance by Obligor of each and every
      Guaranteed Obligation. If Obligor defaults in the payment or performance of
      any
      Guaranteed Obligation, if there exists any event or condition which, with notice
      and/or the passage of time, would constitute a default under any Guaranteed
      Obligation, or if there is a liquidation, bankruptcy, assignment for the benefit
      of creditors or similar proceeding affecting the status, existence, assets
      or
      obligations of Obligor, Guarantor shall pay directly to Textron the sums which
      Obligor is obligated to pay to Textron, whether by acceleration or otherwise,
      and promptly perform all other Guaranteed Obligations. if Textron is required
      tc
      retum any payment made to Textron by or on behalf of Obligor, whether as a
      result of Obligor's bankruptcy, reorganization or otherwise, Guarantor
      acknowledges that this Guaranty covers all such amounts.

     

    2. Continuing
      Nature of Guaranty.
      This
      Guaranty is a continuing guarantee and shall apply without regard to the form
      or
      the amount of the Guaranteed Obligations in existence at any time. Guarantor
      may
      prospectively revoke this Guaranty by sending written notice, by certified
      mail,
      return receipt requested, to Textron at the address for Textron specified below
      (the "Revocation Notice"). The revocation of this Guaranty shall not be
      effective with respect to any Guaranteed Obligation arising on or prior to
      the
      date occurring fifteen (15) days after Textron's receipt of the Revocation
      Notice (the "Revocation
      Date") or arising at any time after the Revocation Date, if arising as the
      result of a commitment made by Textron to Obligor on or prior to the Revocation
      Date.

     

    3. Absolute
      Nature of Guaranty.
      The
      obligations of Guarantor under this Guaranty are absolute and unconditional.
      Guarantor shall not be released from such obligations for any reason, nor shall
      such obligations be reduced, diminished or discharged for any reason,
      Including:

     

    
      	 	
              (a)

            	
              Modifications
                and Indulgences.
                Any modification, renewal or alteration of any agreement, document
                or
                instrument relating to any Guaranteed Obligation, or any indulgence,
                adjustment, preference, extension or compromise made by Textron in
                favor
                of Obligor or Guarantor.

            


    

     

    
      	 	
              (b)

            	
              Condition
                of Obligor or Guarantor.
                Any insolvency, bankruptcy, arrangement, adjustment, composition,
                liquidation, disability, dissolution or similar proceeding affecting
                Obligor or Guarantor; any sale, lease or other disposition of any
                of the
                assets of Obligor or Guarantor; or any reorganization of, or change
                in the
                composition of the shareholders, partners or members of, Obligor
                or
                Guarantor.

            


    

     

    
      	 	
              (c)

            	
              Invalidity
                of Guaranteed Obligations.
                The invalidity, illegality or unenforceability of any Guaranteed
                Obligation for any reason whatsoever, including, but not limited
                to; the
                existence of valid defenses, counterclaims or off-sets to any Guaranteed
                Obligation; the violation of applicable usury laws by any Guaranteed
                Obligation; or the inauthenticity of any document or instrument relating
                to the Guaranteed Obligations.

            


    

    


    (d) Release
      of Obligor.
      Any
      complete or partial release of Obligor or any other party from any Guaranteed
      Obligation.

     

    (e) Release
      of Collateral: Care of Collateral; Status of Liens.
      Any
      release, surrender, exchange, deterioration, waste, loss or impairment of any
      collateral securing payment of any Guaranteed Obligation (the "Collateral"),
      whether negligent or willful; the failure of Textron or any other party to
      exercise reasonable care in the preservation, protection, sale or other
      treatment of any of the Collateral; the failure of Textron to create or perfect
      any security interest intended to be given by Obligor in connection with any
      Guaranteed Obligation (a "Security Interest"); the unenforceability of any
      Security Interest; the subordination of any Security Interest to any other
      lien
      or encumbrance; or the taking or accepting by Textron of any other security
      for,
      or assurance of payment of, any Guaranteed Obligation.

     

    
      	 	
              (f)

            	
              Other
                Action or Inaction.
                Any other action or inaction on the part of Textron, whether or not
                such
                action or inactionprejudices Guarantor or increases the likelihood
                that
                Guarantor will be required to pay or perform any Guaranteed Obligation
                pursuant to the terms hereof.

            


    

     

    it
      is the
      obligation of Guarantor to discharge the Guaranteed Obligations when due,
      notwithstanding any occurrence, circumstance, event, action or omission
      whatsoever, whether or not particularly described herein. Guarantor is not
      entering into this Guaranty in reliance on the value or the availability of
      any
      of the Collateral. Guarantor acknowledges that Guarantor may be required to
      pay
      the Guaranteed Obligations, in full, without the assistance or support of any
      other party. Guarantor has not been induced to enter into this Guaranty on
      the
      basis that any party other than Obligor will be liable to perform any Guaranteed
      Obligation or that Textron will look to any other party to perform any
      Guaranteed Obligation. If this Guaranty is signed by more than one party, the
      obligations of such parties are joint and several and Textron may release,
      or
      settle with, any of such parties without affecting the liability of any other
      party to this Guaranty. To the extent that this Guaranty is secured by property
      of Grantor, Textron shall not be obligated to release its security interest
      in
      such property until all applicable preference periods have passed with respect
      to payments Made to Textron by or on behalf of Obligator.

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
 

    4.
      Waivers.
      Guarantor waives:

     

    
      	
            	(a)	
              Action
                Against Others.
                Any right to require Textron to: institute suit or exhaust remedies
                against Obligor or any other party liable for any Guaranteed Obligation;
                enforce Textron's rights in any of the Collateral or other security
                which
                is at any time given to secure any Guaranteed Obligation; enforce
                Textron's
                rights against any other guarantor of any Guaranteed Obligation;
                join
                Obligor or any other party liable for any Guaranteed Obligation in
                any
                action seeking to enforce this Guaranty; or exhaust any other remedies
                available to Textron or resort to any other means of obtaining payment
                or
                performance of any Guaranteed
                Obligation.

            


    

     

    
      	
            	(b)	
              Notices.
                Notice of the amount of credit extended by Textron to Obligor at
                any time,
                whether primary or secondary; notice of the modification or
                extension of
                any Guaranteed Obligation; notice of a default or other non-performance
                by
                Obligor in connection with any Guaranteed Obligation; notice of the
                transfer
                or
                disposition by Textron of any Guaranteed Obligation; notice of the
                repossession, sale or other disposition of any of the Collateral;
                notice
                of the acceptance of this Guaranty by Textron; demand and presentation
                for
                payment upon Obligor or any other party liable for any Guaranteed
                Obligation; protest, notice of protest and diligence of bringing
                suit
                against Obligor or any other party; and any other action or inaction
                on
                the part of Textron in connection with this Guaranty or any Guaranteed
                Obligation.

            


    

     

    
      	
            	(c)	
              Subrogation.
                Any right which Guarantor may at any time have against Obligor, or
                any
                other party liable for any Guaranteed Obligation, as the result of
                the performance
                by Guarantor of its obligations under this Guaranty, including, but
                not
                limited to, contractual, statutory and common law rights of subrogation,
                reimbursement
                and indemnification.

            


    

     

    


    5. Representations
      and Warranties.
      Guarantor represents and warrants to Textron that:

     

    
      	(a)	
              Benefit.
                Guarantor has received, or will receive, direct or indirect benefit
                from
                the creation of the Guaranteed
                Obligations.

            


    

     

    
      	 	
              (b)

            	
              No
                Representation by Textron
                Neither Textron nor any other party has made any representation,
                warranty
                or statement to Guarantor in order to induce Guarantor to execute
                this
                Guaranty.

            


    

     

    
      	 	
              (c)

            	
              Financial
                Condition.
                As
                of the date hereof, and after giving effect to this Guaranty and
                the
                contingent obligations contained herein, Guarantor is solvent and
                has
                assets which, when fairly valued, exceed its
                liabilities.

            


    

     

    6.
      Governing
      Law; Miscellaneous. This
      Guaranty shall be governed by, and construed in accordance with, the laws of
      the
      State of Rhode Island, without reference to applicable conflict of law
      principles. Guarantor consents to the jurisdiction and venue of Rhode Island
      courts in connection with Textron's enforcement of any of Guarantor's
      obligations under this Guaranty. This
      Guaranty shall not be deemed to create any right in any party except as provided
      herein and shall inure to the benefit of; and be binding upon, the successors
      and assigns of Guarantor and Textron. Guarantor agrees that Textron may,
without
      the consent of, or notice to, Guarantor, assign all or any portion of its rights
      hereunder to any other party to which any Guaranteed Obligation is
      transferred, assigned
      or negotiated. Guarantor shall be liable for all attorneys' fees and other
      costs
      and expenses incurred by Textron in connection with Textron's enforcement
      of
      this
      Guaranty,

     

    The
      undersigned, pursuant to due corporate or partnership authority, as appropriate,
      has or have caused this Guaranty to be executed as of
      the
      date set forth above.

    


    


    WITNESS(ES):                                                       

    By:/s/Norman
      Bledsoe, Jr.                            

    Name:Norman
      S Bledsoe, Jr.

     

    
      Home
        Address:                                          

      308
        South Orleans Ave, # 3                                                                 

      Tampa,
        Florida 33606 

    

                                                    

      	 	 	 
	 	CORPORATE
              OR PARTNERSHIP GUARANTOR
	 
 	 
 	 Deer
              Valley Corporation
 
	 	By:  	/s/ C.
              G. Masters
	 	
              

              Charles G. Masters
	 	Title:
              President


    

                

    Address
      for Notices to Textron: 

    Textron
      Financial Corporation 

    PO
      BOX
      3090

    Alpharetta,
      GA 30023

     

    


    
      
         

      

      
         

        
          

        

      

      
         

      

    


    
       

       
SOLE
      OFFICER'S CERTIFICATE

     

    The
      undersigned, Charles
      G. Masters, the
      sole
      officer of
      Deer Valley Corporation (the
      "Company"), in order to induce Textron Financial Corporation ("TFC") to enter
      into the Agreement(s) (as hereinafter defined), certifies to TFC
      that:

    


    1.
      The
      Company is duly organized, validly existing and in good standing under the
      laws
      of the State or Commonwealth of
      Florida; the
      Company has full corporate power and authority to execute, enter into and
      deliver the Guaranty
      dated
      February
      7, 2007 between
      the Company and TFC and any and all other documents related thereto, whether
      now
      or hereafter executed (the "Agreement(s)"); and all corporate action necessary
      to authorize the execution, delivery and performance of the Agreement(s) has
      been taken and such action has not been modified or rescinded in any
      respect.

     

    2.
      I
      am
      the
      sole duly elected
      (or
      appointed),
      qualified and acting
      officer of the Company,
      having full power and authority to act alone on behalf of the Company with
      respect to the Agreement(s), including any future modification(s) thereof,
      and
      to execute and deliver such other instruments and agreements in connection
      therewith as I deem necessary or
      proper. Said power and authority is being relied upon by TFC and shall remain
      in
      full force and effect for a period of one year
      from
      the date hereof unless TFC shall receive in writing notice of the revocation
      of
      my power to so act on behalf of the
      Company.
      The signature appearing opposite my name below is my genuine
      signature.

    
 

    
      	
               Name        

            	
               Office

            	
              Signature

            
	
               Charles
                G.
                Masters

            	
                President 

            	
               /s/
                C. G.
                Masters

            


    

     

    


    IN
      WITNESS WHEREOF, the undersigned has hereunto signed his or her name and
      imprinted the seal of the Company as of the date set forth below.

    


    	 	 	 
	 	By:  	/s/ C.
            G.
            Masters
	 	
            

            Charles G. Masters
	 	Title:
            President


     

    State
      of Florida

    County
      of Hillsborough

    Sworn
      to
      and
      Subscribed before me
      this
      13th day
      of February, 2007 at Tampa

    State
      of
      Florida

     

    
      	 	 	 
	 	  	/s/ Brenda
              K.
              Holland
	 	
              
                

                Notary Public

              My
                commission expires: 02/04/2011

               

              (NOTARIAL
                SEAL)

               

              BRENDA
                K. HOLLAND

              MY
                COMMISSION #DD 606176

              EXPIRES:
                February 4, 2011

              Bonded
                Thru Notary Public Underwriters