and warrants to Lender as follows:
SECTION 3.1
BENEFIT. GUARANTOR IS THE OWNER OF AN INDIRECT INTEREST
IN BORROWER AND HAS RECEIVED, OR WILL RECEIVE, DIRECT OR INDIRECT BENEFIT FROM
THE MAKING OF THIS GUARANTY WITH RESPECT TO THE GUARANTEED OBLIGATIONS.
SECTION 3.2
FAMILIARITY AND RELIANCE. GUARANTOR IS FAMILIAR WITH,
AND HAS INDEPENDENTLY REVIEWED BOOKS AND RECORDS REGARDING, THE FINANCIAL
CONDITION OF BORROWER AND IS FAMILIAR WITH THE VALUE OF ANY AND ALL COLLATERAL
INTENDED TO BE CREATED AS SECURITY FOR THE PAYMENT
7
OF THE NOTE OR GUARANTEED OBLIGATIONS; PROVIDED, HOWEVER, GUARANTOR IS NOT
RELYING ON SUCH FINANCIAL CONDITION OR THE COLLATERAL AS AN INDUCEMENT TO ENTER
INTO THIS GUARANTY.
SECTION 3.3
NO REPRESENTATION BY LENDER. NEITHER LENDER NOR ANY
OTHER PARTY HAS MADE ANY REPRESENTATION, WARRANTY OR STATEMENT TO GUARANTOR IN
ORDER TO INDUCE GUARANTOR TO EXECUTE THIS GUARANTY.
SECTION 3.4
GUARANTOR'S FINANCIAL CONDITION. AS OF THE DATE HEREOF,
AND AFTER GIVING EFFECT TO THIS GUARANTY AND THE CONTINGENT OBLIGATION EVIDENCED
HEREBY, GUARANTOR IS, AND WILL BE, SOLVENT, AND HAS AND WILL HAVE ASSETS WHICH,
FAIRLY VALUED, EXCEED ITS OBLIGATIONS, LIABILITIES (INCLUDING CONTINGENT
LIABILITIES) AND DEBTS, AND HAS AND WILL HAVE PROPERTY AND ASSETS SUFFICIENT TO
SATISFY AND REPAY ITS OBLIGATIONS AND LIABILITIES.
SECTION 3.5
LEGALITY. THE EXECUTION, DELIVERY AND PERFORMANCE BY
GUARANTOR OF THIS GUARANTY AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED
HEREUNDER DO NOT, AND WILL NOT, CONTRAVENE OR CONFLICT WITH ANY LAW, STATUTE OR
REGULATION WHATSOEVER TO WHICH GUARANTOR IS SUBJECT OR CONSTITUTE A MATERIAL
DEFAULT (OR AN EVENT WHICH WITH NOTICE OR LAPSE OF TIME OR BOTH WOULD CONSTITUTE
A DEFAULT) UNDER, OR RESULT IN THE MATERIAL BREACH OF, ANY INDENTURE, MORTGAGE,
DEED OF TRUST, CHARGE, LIEN, OR ANY CONTRACT, AGREEMENT OR OTHER INSTRUMENT TO
WHICH GUARANTOR IS A PARTY OR BY WHICH GUARANTOR IS BOUND. THIS GUARANTY IS A
LEGAL AND BINDING OBLIGATION OF GUARANTOR AND IS ENFORCEABLE IN ACCORDANCE WITH
ITS TERMS, EXCEPT AS LIMITED BY BANKRUPTCY, INSOLVENCY OR OTHER LAWS OF GENERAL
APPLICATION RELATING TO THE ENFORCEMENT OF CREDITORS' RIGHTS.
SECTION 3.6
SURVIVAL. ALL REPRESENTATIONS AND WARRANTIES MADE BY
GUARANTOR HEREIN SHALL SURVIVE THE EXECUTION HEREOF.
SECTION 3.7
REVIEW OF DOCUMENTS. GUARANTOR HAS EXAMINED THE NOTE AND
ALL OF THE LOAN DOCUMENTS.
SECTION 3.8
LITIGATION. AS OF THE DATE HEREOF AND EXCEPT AS
OTHERWISE DISCLOSED TO LENDER, THERE ARE NO PROCEEDINGS AGAINST GUARANTOR
PENDING OR, TO GUARANTOR'S CURRENT, ACTUAL KNOWLEDGE, THREATENED BEFORE ANY
COURT OR ADMINISTRATIVE AGENCY WHICH, IF DECIDED ADVERSELY TO GUARANTOR, WOULD
MATERIALLY ADVERSELY AFFECT THE FINANCIAL CONDITION OF GUARANTOR OR THE
AUTHORITY OF GUARANTOR TO ENTER INTO THIS GUARANTY OR THE VALIDITY OR
ENFORCEABILITY OF THIS GUARANTY.
SECTION 3.9
TAX RETURNS. GUARANTOR HAS FILED ALL REQUIRED FEDERAL,
STATE AND LOCAL TAX RETURNS (OR ANY EXTENSIONS THEREOF, IF APPLICABLE) AND HAS
PAID ALL TAXES AS SHOWN ON SUCH RETURNS AS THEY HAVE BECOME DUE. NO CLAIMS HAVE
BEEN ASSESSED AND ARE UNPAID WITH RESPECT TO SUCH TAXES.
ARTICLE 4
SUBORDINATION OF CERTAIN INDEBTEDNESS
SECTION 4.1
SUBORDINATION OF ALL