Document:

Exhibit 10.2

 

LIMITED
GUARANTY

 

This LIMITED GUARANTY (as amended, restated, modified
or supplemented and in effect from time to time, this “Guaranty”), dated
as of July 1, 2008, is entered into by and among Southwest Casino
Corporation, a Nevada corporation (“SCC”), Southwest Casino and Hotel
Corp., a Minnesota corporation (“SCH”) (SCC and SCH are referred to
herein each individually as a “Guarantor” and collectively, as the “Guarantors”),
and BLACK DIAMOND COMMERCIAL FINANCE, L.L.C., a Delaware limited liability
company, as Agent.  Unless otherwise
specified herein, capitalized terms used in this Guaranty shall have the
meanings ascribed to them in the Credit Agreement (as hereinafter defined).

 

I.              RECITALS

 

WHEREAS, subject to the terms and conditions of that
certain Credit Agreement dated as of April 20, 2007 by and among North
Metro Harness Initiative, LLC, a Minnesota limited liability company (“Borrower”),
the other Loan Parties, Agent and the Lenders (as defined therein) (as amended,
restated, modified or supplemented and in effect from time to time, the “Credit
Agreement”), the Lenders agreed to make the Initial Advance and additional
Advances to Borrower;

 

WHEREAS, Borrower, the other Loan Parties, Agent and
Lenders are contemporaneously herewith executing that certain Amendment No. 2
to Credit Agreement dated as of the date hereof (the “Second Amendment”)
pursuant to which, among other things, certain of the Lenders have agreed to
make additional credit available to the Borrower;

 

WHEREAS, the Guarantors will derive direct and
indirect economic benefits from the making of additional credit available to
the Borrower and the continued making of Advances to Borrower; and

 

WHEREAS, in order to induce Agent and the Lenders to
enter into the Second Amendment and to induce certain of the Lenders to provide
additional credit to the Borrower and continue to make Advances, each Guarantor
has agreed to guarantee payment of the Obligations as hereinafter set forth.

 

NOW, THEREFORE, in consideration of the premises and
the covenants hereinafter contained and other good and valuable consideration,
it is agreed as follows:

 

II.            GUARANTY

 

Each Guarantor, jointly and severally, hereby
unconditionally guaranties the full and prompt payment when due, whether at
maturity or earlier, by reason of acceleration or otherwise, and at all times
thereafter, and performance of the Obligations (the “Guaranteed Obligations”).  Notwithstanding the foregoing, the maximum
aggregate amount of Guaranteed Obligations that the Guarantors are guaranteeing
hereunder shall be limited to $1,000,000 plus the Additional Costs (as defined
below) related to such amount.  For the
purposes of this Guaranty, the term “Additional Costs” shall mean all fees,
costs and expenses (including reasonable attorneys’ fees and expenses) incurred
by Agent or any Lender (i) in attempting to collect any amount due under
this Guaranty or (ii) in prosecuting any action against one or more
Guarantors and all interest, fees, costs and expenses owing to Agent or any
Lender after the commencement of bankruptcy proceedings with respect to any
Guarantor (whether or not the 

 

 

same may be collected
while such proceedings are pending).  For
the avoidance of doubt, unless one or more Guarantors fail to promptly comply
with their obligations hereunder after written notice from Agent or any Lender,
the term “Additional Costs” does not include fees, costs and expenses incurred
in attempting to collect any amount due from the Borrower or from any other
guarantor (other than a Guarantor) of all or part of the Guaranteed Obligations
or incurred in prosecuting any action against Borrower or any other guarantor
(other than a Guarantor) of all or part of the Guaranteed Obligations.

 

Each Guarantor hereby agrees that this Guaranty is a
present and continuing guaranty of payment and not of collection and that its
obligations hereunder shall be unconditional, irrespective of (i) the
validity or enforceability of the Guaranteed Obligations or any part thereof,
or of any of the Loan Documents, (ii) the waiver or consent by Agent or
any Lender with respect to any provision of any Loan Document, or any
amendment, modification or other change with respect to any Loan Document, (iii) any
merger or consolidation of Borrower, any Guarantor or any other guarantor of
all or part of the Guaranteed Obligations into or with any Person or any change
in the ownership of the equity of Borrower, any Guarantor or any other
guarantor of all or part of the Guaranteed Obligations, (iv) any
dissolution of any Guarantor or any insolvency, bankruptcy, liquidation,
reorganization or similar proceedings with respect to Borrower, any Guarantor
or any other guarantor of all or part of the Guaranteed Obligations, (v) any
action or inaction on the part of Agent or any Lender, including without
limitation the absence of any attempt to collect the Guaranteed Obligations
from Borrower, any Guarantor or any other guarantor of all or part of the
Guaranteed Obligations or other action to enforce the same or the failure by
Agent to take any steps to perfect and maintain its Lien on, or to preserve its
rights to, any security or collateral for the Guaranteed Obligations, (vi) Agent’s
election, in any proceeding instituted under Chapter 11 of Title 11 of the
United States Code (11 U.S.C. Section 101 et seq.), as amended (the “Bankruptcy
Code”) of the application of Section 1111(b)(2) of the Bankruptcy
Code, (vii) any borrowing or grant of a Lien by Borrower, any Guarantor or
any other guarantor of all or part of the Guaranteed Obligations, as
debtor-in-possession, under Section 364 of the Bankruptcy Code, (viii) the
disallowance, under Section 502 of the Bankruptcy Code, of all or any
portion of Agent’s or any Lender’s claims for repayment of the Guaranteed
Obligations, (ix) Agent’s or any Lender’s inability to enforce the
Guaranteed Obligations as a result of the automatic stay provisions under Section 362
of the Bankruptcy Code, (x) the discharge or release by Agent and/or
Lenders of any Guarantor’s obligations and liabilities under this Guaranty,
(xi) whether any other Person guarantees any Obligations or any Person is
released from any guaranty of any Guaranteed Obligations or (xii) any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of Borrower, any Guarantor or any other guarantor of all or part of the
Guaranteed Obligations.

 

No payment made by or for the account or benefit of
any Guarantor (including, without limitation, (i) a payment made by
Borrower in respect of the Guaranteed Obligations, (ii) a payment made by
any other Guarantor pursuant to this Guaranty, (iii) a payment made by any
Person under any other guaranty of the Guaranteed Obligations or (iv) a
payment made by means of set-off or other application of funds by Agent or any Lender)
pursuant to this Guaranty shall entitle such Guarantor, by subrogation or
otherwise, to any payment by Borrower or from or out of any property of
Borrower, and each Guarantor shall not exercise any right or remedy against
Borrower or any property of Borrower including, without limitation, any right
of contribution or reimbursement by reason of any performance by Guarantors
under this Guaranty, until the 

 

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Guaranteed Obligations
have been indefeasibly paid in full in cash and the Credit Agreement has been
terminated.

 

Each Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of any bankruptcy
proceeding (or other insolvency proceeding) of Borrower, protest or notice with
respect to the Guaranteed Obligations and all demands whatsoever, and covenants
that this Guaranty will not be discharged, except by complete and irrevocable
payment and performance of the obligations and liabilities contained
herein.  No notice to Guarantors or any
other party shall be required for Agent, on behalf of Agent or any Lender, to
make demand hereunder.  Such demand shall
constitute a mature and liquidated claim against Guarantors.  Upon the occurrence and during the
continuance of any Event of Default, Agent may, at its sole election, proceed
directly and at once, without notice, against any Guarantor to collect and
recover the full amount or any portion of the Guaranteed Obligations, without
first proceeding against Borrower, any other Guarantor, any other Person or any
security or collateral for the Guaranteed Obligations.  Agent shall have the exclusive right to
determine the application of payments and credits, if any, from Guarantors,
Borrower, any other Person, or any security or collateral for the Guaranteed
Obligations, on account of the Guaranteed Obligations.

 

Agent and Lenders are hereby authorized, without
notice or demand to Guarantors and without affecting or impairing the liability
of Guarantors hereunder, to, from time to time, (i) renew, extend,
accelerate or otherwise change the time for payment of, or other terms relating
to, the Guaranteed Obligations or otherwise modify, amend or change the terms
of any Loan Document, (ii) accept partial payments on the Guaranteed
Obligations, (iii) take and hold collateral for the payment of the
Guaranteed Obligations, or for the payment of this Guaranty, or for the payment
of any other guaranties of the Guaranteed Obligations or other liabilities of
Borrower, and exchange, enforce, waive and release any such collateral, (iv) apply
such collateral and direct the order or manner of sale thereof as in their sole
discretion they may determine, (v) settle, release, compromise, collect or
otherwise liquidate the Guaranteed Obligations and any collateral therefor in
any manner, (vi) take any other action under or in respect of the Loan
Documents in the exercise of any remedy, power or privilege contained therein
or available to it at law, equity or otherwise, or waive or refrain from
exercising any such remedies, powers or privileges and/or (vii) extend or
waive the time for any Loan Party’s performance of, or compliance with, any
term, covenant or agreement on its part to be performed or observed under the
Loan Documents, or waive such performance or compliance or consent to a failure
of, or departure from, such performance or compliance.

 

At any time after maturity of the Guaranteed
Obligations, Agent and Lenders may, in their sole discretion, without notice to
Guarantors and regardless of the acceptance of any collateral for the payment
hereof, appropriate and apply toward payment of the Guaranteed Obligations (i) any
indebtedness due or to become due from Agent or any Lender to Guarantors and (ii) any
moneys, credits or other property belonging to Guarantors at any time held by
or coming into the possession of Agent or any Lender or any Affiliates thereof,
whether for deposit or otherwise.

 

Each Guarantor hereby assumes responsibility for
keeping itself informed of the financial condition of Borrower, and any and all
endorsers and other guarantors of all or any part of the Guaranteed Obligations
and of all other circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations or any part thereof that diligent inquiry would reveal, 

 

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and each Guarantor hereby
agrees that neither Agent nor any Lender shall have any duty to advise
Guarantors of information known to such Agent or Lender regarding such
condition or any such circumstances. 
Each Guarantor hereby acknowledges familiarity with Borrower’s financial
condition and that it has not relied on any statements by Agent or any Lender
in obtaining such information.  In the
event Agent or any Lender, in its sole discretion, undertakes at any time or
from time to time to provide any such information to Guarantors, neither Agent
nor any Lender shall be under any obligation (i) to undertake any
investigation with respect thereto, (ii) to disclose any information which,
pursuant to accepted or reasonable commercial finance practices, Agent or such
Lender wishes to maintain confidential or (iii) to make any other or
future disclosures of such information, or any other information, to
Guarantors.

 

Each Guarantor consents and agrees that neither Agent
nor any Lender shall be under any obligation to marshal any assets in favor of
Guarantors or against or in payment of any or all of the Guaranteed
Obligations.  Each Guarantor further agrees
that, to the extent that Borrower makes a payment or payments to Agent or any
Lender, or Agent or any Lender receives any proceeds of Collateral, which
payment or payments or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside or required to be repaid to
Borrower, its estate, trustee, receiver or any other party, including without
limitation any Guarantor, under any bankruptcy law, state or federal law,
common law or equitable cause, then to the extent of such payment or repayment,
the Guaranteed Obligations or the part thereof which has been paid, reduced or
satisfied by such amount shall be reinstated and continued in full force and
effect as of the date such initial payment, reduction or satisfaction occurred,
and this Guaranty shall continue to be in existence and in full force and
effect, irrespective of whether any evidence of indebtedness has been
surrendered or cancelled.

 

Each Guarantor also waives all set-offs and
counterclaims and all presentments, demands for performance, notices of nonperformance,
protests, notices of protest, notices of dishonor, and notices of acceptance of
this Guaranty.  Each Guarantor further
waives all notices of the existence, creation or incurring of new or additional
indebtedness, arising either from additional loans extended to Borrower or
otherwise, and also waives all notices that the principal amount, or any
portion thereof, or any interest under or on any Loan Document is due, notices
of any and all proceedings to collect from the maker, any endorser or any other
guarantor of all or any part of the Guaranteed Obligations, or from anyone
else, and, to the extent permitted by law, notices of exchange, sale, surrender
or other handling of any security or collateral given to Agent to secure
payment of the Guaranteed Obligations.

 

III.           MISCELLANEOUS

 

Each Guarantor hereby represents and warrants to Agent
and Lenders that (i) it is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (ii) its
jurisdiction of organization, federal employee identification number,
organizational identification number, chief executive office and principal
place of business are as set forth in Schedule III hereto, (iii) the
execution, delivery and performance by such Guarantor of this Guaranty and the
other Loan Documents to which it is a party are within its powers, have been
duly authorized by all necessary action pursuant to its Organizational
Documents, require no further action by or in respect of, or filing with, any
governmental body, agency or official, do not violate, conflict with or cause a
breach or a default under any provision of material applicable law or
regulation, any of its organizational documents or any material agreement,
judgment, injunction, order, decree or other instrument binding upon it or any
of its properties 

 

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and do not result in the
creation or imposition of any Lien upon any of the property of such Guarantor,
other than those in favor of Agent, for itself and the benefit of Lenders and (iv) this
Guaranty, and each other Loan Document to which it is a party, constitutes a
valid and binding agreement or instrument of such Guarantor, enforceable
against such Guarantor in accordance with its respective terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency or other
similar laws relating to the enforcement of creditors’ rights generally and by
general equitable principles.

 

No delay on the part of Agent in the exercise of any right
or remedy shall operate as a waiver thereof, and no single or partial exercise
by Agent of any right or remedy shall preclude any further exercise thereof;
nor shall any modification or waiver of any of the provisions of this Guaranty
be binding upon Agent or Lenders, except as expressly set forth in a writing
duly signed and delivered on Agent’s behalf by an authorized officer or agent
of Agent.  Agent’s or any Lender’s
failure at any time or times hereafter to require strict performance by
Guarantors of any of the provisions, warranties, terms and conditions contained
in this Guaranty shall not waive, affect or diminish any right of Agent and
Lenders at any time or times hereafter to demand strict performance thereof and
such right shall not be deemed to have been waived by any act or knowledge of
Agent or any Lender, or its respective agents, officers or employees, unless
such waiver is contained in an instrument in writing signed by an officer or
agent of Agent, and directed to Borrower or a Guarantor, as applicable,
specifying such waiver.  No failure or
delay by Agent or any Lender in exercising any right, power or privilege under
this Guaranty shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. 
The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.

 

This Guaranty shall be binding upon Guarantors and their
respective successors and assigns and shall inure to the benefit of Agent and
Lenders and their respective successors and assigns, except that no Guarantor
may assign its obligations hereunder without the written consent of Agent.  All notices, approvals, requests, demands and
other communications hereunder shall be given in accordance with the notice
provision of the Credit Agreement; provided, that such notices shall be given
to Guarantors at their respective address or facsimile number set forth on the
signature pages hereof.

 

This Guaranty is a continuing guaranty and shall
remain in full force and effect until the earlier of (x) June     ,
2010 and (y) the
date referred to in clause (b) of the defined term “Maturity Date”.

 

Each Guarantor agrees, upon the written request of
Agent or any Lender, to execute and deliver to Agent or such Lender, from time
to time, any additional instruments or documents reasonably considered
necessary by Agent or such Lender to cause this Guaranty to be, become or remain
valid and effective in accordance with its terms.

 

THIS
AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS WHICH DOES NOT EXPRESSLY SET
FORTH APPLICABLE LAW SHALL BE GOVERNED BY AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICTS OF LAW PRINCIPALS.

 

5

 

EACH
GUARANTOR HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED WITHIN NEW YORK COUNTY, STATE OF NEW YORK AND IRREVOCABLY AGREE THAT,
SUBJECT TO AGENT’S ELECTION, ALL ACTIONS OR PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS GUARANTY SHALL BE LITIGATED IN SUCH COURTS.  EACH GUARANTOR EXPRESSLY SUBMITS AND CONSENTS
TO THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS.  EACH GUARANTOR HEREBY WAIVES
PERSONAL SERVICE OF ANY AND ALL PROCESS WITH REGARD TO THIS GUARANTY AND AGREES
THAT ALL SUCH SERVICE OF PROCESS WITH REGARD TO THIS GUARANTY MAY BE MADE
UPON SUCH GUARANTOR BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED,
ADDRESSED TO SUCH GUARANTOR, AT THE ADDRESS OF ITS CHIEF EXECUTIVE OFFICER SET
FORTH IN SCHEDULE III TO THIS GUARANTY AND SERVICE SO MADE SHALL BE COMPLETE
TEN (10) DAYS AFTER THE SAME HAS BEEN POSTED.

 

EACH GUARANTOR
AND AGENT HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY.  EACH GUARANTOR AND AGENT ACKNOWLEDGE THAT
THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP,
THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS GUARANTY AND THAT EACH
WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS.  EACH GUARANTOR AND AGENT WARRANT AND
REPRESENT THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH
LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS.

 

This Guaranty may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.

 

In addition to and without limitation of any of the
foregoing, this Guaranty shall be deemed to be a Loan Document.

 

Notwithstanding anything in this Guaranty to the
contrary, nothing in this Guaranty may be construed to deem either Guarantor to
be a “Borrower” or a “Loan Party” under the Credit Agreement or any other Loan
Document.

 

6

 

IN WITNESS WHEREOF, the parties have executed this
Guaranty as of the date first written above.

 

	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  SOUTHWEST CASINO CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Its:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SOUTHWEST CASINO AND HOTEL

  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Its:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BLACK
  DIAMOND COMMERCIAL FINANCE,

  
	
   

  	
  L.L.C.,

  
	
   

  	
  as Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Its:Exhibit 4.71

 

 

January 31, 2008

 

BY PERSONAL DELIVERY

 

Ms. Alida Gualtieri

11026 Paris Street

Montréal-Nord, Québec 
H2H 4L1

 

Re:
Employment Agreement

 

Dear Alida:

 

Further
to our recent discussions, we hereby confirm that your employment agreement
with DRAXIS Health Inc. dated October 17, 2003 and amended on March 26,
2004 (the “Employment Agreement”) is hereby amended as follows:

 

·                  By
deleting Section 3 and replacing it with the following Section 3:

 

You
will be entitled to participate in all benefit plans which the DRAXIS Group
shall, from time to time make available to its executive employees, subject to
applicable eligibility rules thereof. 
The benefits currently offered are:

·                  major medical

·                  drug

·                  dental

·                  group life

·                  short and long term disability

·                  accidental death and dismemberment

 

You will also be entitled
to an amount of up to 5% of your Base Salary, which exact percentage shall be
determined from year to year in lieu of participation in DRAXIS’ Retirement
Savings Program. (the “DRSP Amount”)

 

·                  By
deleting Section 13(c) and replacing it with the following Section 13(c):

 

(c)                                  Termination
by DRAXIS Without Serious Reason and Without Notice

 

DRAXIS may
terminate this Agreement and your employment hereunder, in its sole discretion,
Without Notice and Without Serious Reason, effective immediately upon the date
you are advised of the termination (the “Date of Termination”)

 

 

 

 

 

 

 

 

 

DRAXIS
HEALTH  INC. / SANTÉ DRAXIS INC.

16751 Route Trans Canada Highway, Kirkland, Québec, Canada H9H 4J4  Tel: (514) 694-8220 Fax: (514) 694-8201

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