Document:

Exhibit 
10.113

 

GUARANTY

 

This GUARANTY (this “Guaranty”) is made and
entered into by KENNEDY-WILSON, INC., a Delaware corporation, and KW PROPERTY
FUND III, L.P., a Delaware limited partnership, each having an address at c/o
Kennedy-Wilson Inc., 9601 Wilshire Boulevard, Suite 220, Beverly Hills,
California 90210 (individually and collectively, “Guarantor”), jointly
and severally, for the benefit of DEUTSCHE BANK AG, CAYMAN ISLANDS BRANCH, a
branch of a foreign banking institution whose address is 60 Wall Street, New
York, New York 10005 (“Buyer”) on this May 29, 2008.  This Guaranty is made with reference to the
following facts (with some capitalized terms being defined below):

 

A.                                   KW Kona Investors, LLC, as Seller, and
Buyer have entered into that certain Master Repurchase Agreement, dated May 29,
2008 (the “Repurchase Agreement”), pursuant to which the Buyer shall
purchase the Purchased Loan Participations from KW Kona Investors, LLC with a
simultaneous agreement from KW Kona Investors, LLC to repurchase the Purchased
Loan Participations at a date certain or following the occurrence of an Event
of Default thereunder that is continuing (the “Transactions”);

 

B.                                     Buyer has requested, as a condition of
entering into the Repurchase Agreement, that the Guarantor deliver to Buyer
this Guaranty;

 

C.                                     Guarantor collectively owns 100% of the
interests of KW Kona Investors, LLC;

 

D.                                    Guarantor expects to benefit if Buyer
enters into the Repurchase Agreement with Seller, and desires that Buyer enter
into the Repurchase Agreement with Seller; and

 

E.                                      Buyer would not enter into the Repurchase
Agreement with KW Kona Investors, LLC unless Guarantor executed this
Guaranty.  This Guaranty is therefore
delivered to Buyer to induce Buyer to enter into the Repurchase Agreement.

 

NOW,
THEREFORE, in
exchange for good, adequate, and valuable consideration, the receipt of which
Guarantor acknowledges, and to induce Buyer to enter into the Repurchase
Agreement, Guarantor agrees as follows:

 

1.                                       Definitions.  For purposes of this Guaranty, the following terms
shall be defined as set forth below.  In
addition, any capitalized term defined in the Repurchase Agreement but not
defined in this Guaranty shall have the same meaning in this Guaranty as in the
Repurchase Agreement.

 

(a)                                  “Buyer Entity” means, as
designated by Buyer from time to time, Buyer or Buyer’s assignee, designee,
nominee, servicer, or wholly owned subsidiary as permitted in accordance with
the terms of the Repurchase Agreement.

 

 

(b)                                 “Capital Lease”, as applied to any
Person, means any lease of any property (whether real, personal or mixed) by
that Person or entity as lessee that, in conformity with GAAP, is accounted for
as a capital lease on the balance sheet of that Person or entity.

 

(c)                                  “Cash Equivalent” means (A) readily
marketable obligations issued or directly and fully guaranteed or insured by
the United States of America or any agency or instrumentality thereof having
maturities of not more than 360 days from the date of acquisition thereof; (B) time
deposits with, or insured certificates of deposit or bankers’ acceptances of,
any commercial bank that (i) is organized under the laws of the United
States of America, any state thereof or the District of Columbia or is the
principal banking subsidiary of a bank holding company organized under the laws
of the United States of America, any state thereof or the District of Columbia,
and (ii) has combined capital and surplus of at least $500,000,000; (C) commercial
paper issued by any person organized under the laws of any state of the United
States of America and rated at least “Prime-1” (or the then equivalent grade)
by Moody’s or at least “A-1” (or the then equivalent grade) by S&P, in each
case with maturities of not more than 180 days from the date of acquisition
thereof; and (D) investments in money market investment programs
registered under the Investment Company Act of 1940, the portfolios of which
are limited solely to investments of the character, quality and maturity
described in clauses (A), (B) and (C) of this definition.

 

(d)                                 “GAAP” means with respect to the
financial statements or other financial information of any Person, generally
accepted accounting principles in the United States which are in effect from
time to time.

 

(e)                                  “Guarantied Obligations” means
Seller’s obligations (without regard to any limitation of recourse against
Seller):  (a) to fully and promptly
pay the Repurchase Price and other sums owed under the Transaction Documents at
the times and according to the terms required by the Transaction Documents,
without regard to any modification, suspension, or limitation of such terms not
agreed to by Buyer, such as a modification, suspension, or limitation arising
in or pursuant to any Insolvency Proceeding affecting Seller (even if any such
modification, suspension, or limitation causes Seller’s obligation to become
discharged or unenforceable); and (b) to pay all other sums expended by
Buyer or Buyer’s designee or nominee acting on Buyer’s behalf in exercising
Buyer’s rights and remedies under the Transaction Documents, including Buyer’s
Legal Costs relating to the enforcement of remedies pursuant to the Transaction
Documents.

 

(f)                                    “Guarantor Litigation” means any
litigation, arbitration, investigation, or administrative proceeding of or
before any court, arbitrator, or governmental authority, bureau or agency that
relates to or affects this Guaranty or any asset(s) or property(ies) of
Guarantor.

 

(g)                                 “Indebtedness” means, for any
Person:  (a) obligations created,
issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of property to another Person
subject to an understanding or agreement, contingent or otherwise, to
repurchase such property from such Person); (b) obligations of such Person
to pay the deferred purchase or acquisition price of property or services,
other than trade accounts payable (other than for borrowed money) arising, and
accrued expenses incurred, in the ordinary course of business so long as such
trade accounts payable are payable within ninety (90) 

 

2

 

days of the date the
respective goods are delivered or the respective services are rendered; (c) indebtedness
of others secured by a Lien on the property of such Person, whether or not the
respective indebtedness so secured has been assumed by such Person; (d) obligations
of such Person in respect of letters of credit or similar instruments issued or
accepted by banks and other financial institutions for account of such person; (e) Capital
Leases of such Person; and (f) indebtedness of others guaranteed by such
Person.

 

(h)                                 “Insolvency Proceeding” means any
case under Title 11 of the United States Code or any successor statute or any
other insolvency, bankruptcy, reorganization, liquidation, or like proceeding,
or other statute or body of law relating to creditors’ rights, whether brought
under state, federal, or foreign law.

 

(i)                                     “Legal Costs” means all costs and
actual out-of-pocket expenses reasonably incurred by Buyer in any Proceeding or
in obtaining legal advice and assistance in connection with any Proceeding, any
Guarantor Litigation, or any default by Seller under the Transaction Documents
or by any Guarantor under this Guaranty (including any breach of a representation
or warranty contained in this Guaranty), including reasonable attorneys’ fees,
disbursements, and other reasonable charges incurred by Buyer’s attorneys,
court costs and expenses, and reasonable charges for the services of
paralegals, law clerks, and all other personnel whose services are charged to
Buyer in connection with Buyer’s receipt of legal services incurred in
connection with the enforcement of this Guaranty.

 

(j)                                     “Lien” means any mortgage, lien,
encumbrance, charge or other security interest, whether arising under contract,
by operation of law, judicial process or otherwise.

 

(k)                                  “Marketable Securities” means any
of the following:

 

(i)                                     98% of the market value of negotiable
debt obligations issued by the U.S. 
Treasury Department having a remaining maturity of less than 1 year; or

 

(ii)                                  95% of the market value of negotiable
debt obligations issued by the U.S. 
Treasury Department having a remaining maturity of 1-10 years; or

 

(iii)                               90% of the market value of negotiable
debt obligations issued by the U.S. 
Treasury Department having a remaining maturity of more than 10 years;
or

 

(iv)                              90% of the market value of single-class
mortgage participation certificates (“FHLMC Certificates”) in book-entry form
backed by single-family residential mortgage loans, the full and timely payment
of interest at the applicable certificate rate and the ultimate collection of
principal of which are guaranteed by the Federal Home Loan Mortgage Corporation
(excluding Real Estate Mortgage Investment Conduit (“REMIC “) or other
multi-class pass-through certificates, collateralized mortgage obligations,
pass-through certificates backed by adjustable rate mortgages, securities
paying interest or principal only and similar derivative securities); or

 

(v)                                 90% of the market value of single-class
mortgage pass-through certificates (“FNMA Certificates”) in book-entry form
backed by single-family residential 

 

3

 

mortgage loans, the full
and timely payment of interest at the applicable certificate rate and ultimate
collection of principal of which are guaranteed by the Federal National
Mortgage Association (excluding REMIC or other multi-class pass-through
certificates, pass-through certificates backed by adjustable rate mortgages collateralized
mortgage obligations, securities paying interest or principal only and similar
derivative securities); or

 

(vi)                              90% of the market value of single-class
fully modified pass-through certificates (“GNMA Certificates” in book-entry
form backed by single-family residential mortgage loans, the full and timely
payment of principal and interest of which is guaranteed by the Government
National Mortgage Association (excluding REMIC or other multi-class
pass-through certificates, collateralized mortgage obligations, pass-through
certificates backed by adjustable rate mortgages, securities paying interest or
principal only and similar derivatives securities); or

 

(vii)                           85% of all actively and regularly traded
investment-grade residential mortgage-backed securities; or

 

(viii)                        such other collateral as Guarantor and
Buyer may agree, with such valuation percentage applied thereto as Buyer, in
its sole discretion acting in good faith shall deem appropriate.

 

(l)                                     “Net Worth” means the amount which
would be included under stockholders’ equity on a consolidated balance sheet of
Guarantor and its Subsidiaries determined on a consolidated basis in accordance
with GAAP.

 

(m)                               “Person” means an individual,
partnership, limited liability company, corporation, joint stock company, trust
or unincorporated organization or a governmental agency or political
subdivision thereof.

 

(n)                                 “Proceeding” means any action,
suit, arbitration, or other proceeding arising out of, or relating to the
interpretation or enforcement of, this Guaranty or the Transaction Documents,
including (a) an Insolvency Proceeding; (b) any proceeding in which
Buyer endeavors to realize upon any Security or to enforce any Transaction
Document(s) (including this Guaranty) against Seller or Guarantor, whether
or not Buyer prevails; and (c) any proceeding commenced by Seller or
Guarantor against Buyer.

 

(o)                                 “Restrictive Covenants” shall have
the meaning set forth in Paragraph 5(c) of this Guaranty.

 

(p)                                 “Security” means any security or
collateral held by or for Buyer for the Guarantied Obligations, whether real or
personal property, including any mortgage, deed of trust, financing statement,
security agreement, and other security document or instrument of any kind
securing the Transactions in whole or in part. 
“Security” shall include all assets and property of any kind whatsoever
pledged or mortgaged to Buyer pursuant to the Security Documents.

 

(q)                                 “Seller” means:  (a) KW Kona Investors, LLC, acting on
its own behalf; (b) any estate created by the commencement of an
Insolvency Proceeding affecting KW Kona Investors, LLC; (c) any trustee,
liquidator, sequestrator, or receiver of Seller or Seller’s property; 

 

4

 

and (d) any similar
person duly appointed pursuant to any law governing any Insolvency Proceeding.

 

(r)                                    “Subsequent Guaranty” shall have
the meaning set forth in Paragraph 5(b) of this Guaranty.

 

(s)                                  “Subsidiary” means as to any
Person, a corporation, partnership, limited liability company or other entity
of which shares of stock or other ownership interests having ordinary voting
power (other than stock or such other ownership interests having such power
only by reason of a contingency) to elect a majority of the board of directors
or other managers of such corporation, partnership, limited liability company
or other entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Person.

 

(t)                                    “Transaction Documents” means:  (a) collectively, the Repurchase
Agreement (and any annexes thereto), that certain Custodial Agreement dated as
of the date hereof by and among LaSalle Bank, N.A., Buyer and Seller, and this
Guaranty; (b) any other documents or instruments relating to any such
documents executed by Seller or Guarantor; and (c) any modifications,
extensions, renewals, restatements, or replacements of any of the foregoing,
whether or not consented to by Guarantor. 
If the Transaction Documents, as so defined, are modified pursuant to
any Insolvency Proceeding, then Buyer may, at Buyer’s option, deem the
definition of Transaction Documents either (1) to have been modified to
reflect any such modification, or (2) to continue as it was, without
regard to any such modification.

 

2.                                       Absolute
Guaranty of All Guarantied Obligations.  Guarantor unconditionally and irrevocably
guarantees Seller’s prompt and complete payment, observance, fulfillment, and
performance of all Guarantied Obligations when due.  Guarantor shall be liable for, and obligated
to pay and perform, all Guarantied Obligations when due.  All assets and property of Guarantor shall be
subject to recourse if Guarantor fails to pay and perform any Guarantied
Obligation(s) when and as required to be paid and performed pursuant to
the Transaction Documents.

 

3.                                       Nature
and Scope of Liability.  Guarantor’s liability under this Guaranty
is primary and not secondary.  Guarantor’s
liability under this Guaranty shall be in the full amount of all Guarantied
Obligations, including any interest, default interest, costs and fees
(including Legal Costs) payable by Seller under the Repurchase Agreement.

 

4.                                       Changes
in Transaction Documents.  Without notice to, or consent by,
Guarantor, and in Buyer’s sole and absolute discretion and without prejudice to
Buyer or in any way limiting or reducing Guarantor’s liability under this
Guaranty but subject to the terms of the Transaction Documents, Buyer may:  (a) grant extensions of time, renewals
or other indulgences or modifications to Seller or any other party under any of
the Transaction Document(s), (b) change, amend or modify any Transaction
Document(s), (c) authorize the sale, exchange, release or subordination of
any Security, (d) accept or reject additional Security, (e) discharge
or release any party or parties liable under the Transaction Documents, (f) foreclose
or otherwise realize on any Security, or attempt to foreclose or otherwise
realize on any Security, whether such attempt is successful or unsuccessful, (g) accept
or make compositions or other arrangements or file or 

 

5

 

refrain from filing a
claim in any Insolvency Proceeding, (h) make other or additional
Transactions to Seller in such amount(s) and at such time(s) as Buyer
may determine, (i) credit payments in such manner and order of priority to
principal, interest or other obligations as Buyer may determine in its
discretion, and (j) otherwise deal with Seller and any other party related
to the Transactions or any Security as Buyer may determine in its sole and
absolute discretion.  Without limiting
the generality of the foregoing, Guarantor’s liability under this Guaranty
shall continue even if Buyer alters any obligations under the Transaction
Documents in any respect or Buyer’s or Guarantor’s remedies or rights against
Seller are in any way impaired or suspended without Guarantor’s consent.  If Buyer performs any of the actions
described in this paragraph, then Guarantor’s liability shall continue in full
force and effect even if Buyer’s actions impair, diminish or eliminate
Guarantor’s subrogation, contribution, or reimbursement rights (if any) against
Seller or otherwise adversely affect Guarantor or expand Guarantor’s liability
hereunder.

 

5.                                       Certain Financial Covenants.

 

(a)                                  Guarantor shall not permit with respect to itself
collectively (and its respective Subsidiaries on a consolidated basis), any of
the following to be breached, as determined quarterly on a consolidated basis
in conformity with GAAP:

 

Minimum Net Worth.  Net
Worth to be less than $75,000,000.00;

 

Debt to Book Equity. 
The ratio of Indebtedness to Net Worth to exceed 3 to 1;

 

Minimum Liquidity. 
The sum of cash and Cash Equivalents to be less than $5,000,000.00, provided,
for the purposes of this Guaranty, no amounts described as “restricted cash” in
the financial statements delivered pursuant to the Repurchase Agreement shall
be included in such calculation;

 

(b)                                 Guarantor agrees that with respect to any
agreement (including, but not limited to, a credit agreement) or guaranty which
Guarantor enters into and delivers after the date hereof which contains
financial covenants that are applicable to the Guarantor, Guarantor shall
deliver a certified copy of such agreement or guaranty (collectively, a “Subsequent  Guaranty”) to Buyer so long as such Subsequent Guaranty is not
subject to a confidentiality agreement.

 

(c)                                  Guarantor agrees that in the event that
any Subsequent Guaranty contains financial covenants applicable to the
Guarantor of the same type as those set forth in Section 5(a) hereof
that are more restrictive on the Guarantor than those set forth in Section 5(a) above
(the “Restrictive Covenants”); (i) Guarantor shall provide written notice of
such event and, in the event a copy of such Subsequent Guaranty is not
delivered pursuant to Section 5(b) above due to a confidentiality
agreement, a description of such Restrictive Covenants satisfactory to Buyer,
and (ii) for purposes of this Guaranty the financial covenants in Section 5(a) shall
be deemed automatically modified to be equal to the Restrictive Covenants.  Upon request of Buyer, Guarantor shall
deliver any additional documentation confirming the foregoing.  Notwithstanding the foregoing, if (i) compliance
with any of the Restrictive Covenants is waived by the beneficiary thereof,
then for so long as such waiver is in effect, a breach of such Restrictive
Covenant shall not constitute a default under this Guaranty (provided that the 

 

6

 

covenants in Section 5(a) above
are not breached), and (ii) if such Restrictive Covenant is modified,
supplemented or amended, the financial covenants in Section 5(a) shall
be deemed automatically modified to be equal to the Restrictive Covenants as
modified, supplemented or amended (it being understood and agreed that if such
modification, supplement or amendment makes the financial covenants less
restrictive than Section 5(a) above, then the covenants in Section 5(a) above
shall once again control).

 

6.                                       Nature
of Guaranty.  Guarantor’s liability under this Guaranty
is a guaranty of payment of the Guarantied Obligations, and is not a guaranty
of collection or collectibility. 
Guarantor’s liability under this Guaranty is not conditioned or
contingent upon the genuineness, validity, regularity or enforceability of any
of the Transaction Documents.  Guarantor’s
liability under this Guaranty is a continuing, absolute, and unconditional
obligation under any and all circumstances whatsoever (except as expressly
stated, if at all, in this Guaranty), without regard to the validity,
regularity or enforceability of any of the Guarantied Obligations.  Guarantor acknowledges that Guarantor is
fully obligated under this Guaranty even if Seller had no liability at the time
of execution of the Transaction Documents or later ceases to be liable under
any Transaction Document pursuant to Insolvency Proceedings.  Guarantor shall not be entitled to claim, and
irrevocably covenants not to raise or assert, any defenses against the
Guarantied Obligations that would or might be available to Seller, other than
actual payment and performance of all Guarantied Obligations in full in
accordance with their terms.  Guarantor
waives any right to compel Buyer to proceed first against Seller or any
Security before proceeding against Guarantor. 
Guarantor agrees that if any of the Guarantied Obligations are or become
void or unenforceable (because of inadequate consideration, lack of capacity,
or Insolvency Proceedings), then Guarantor’s liability under this Guaranty
shall continue in full force with respect to all Guarantied Obligations as if
they were and continued to be legally enforceable, all in accordance with their
terms before giving effect to the Insolvency Proceedings.  Guarantor also recognizes and acknowledges
that its liability under this Guaranty may be more extensive in amount and more
burdensome than that of Seller. 
Guarantor waives any defense that might otherwise be available to
Guarantor based on the proposition that a guarantor’s liability cannot exceed
the liability of the principal. 
Guarantor intends to be fully liable under the Guarantied Obligations
regardless of the scope of Seller’s liability thereunder.  Without limiting the generality of the
foregoing, if the Guarantied Obligations are “nonrecourse as to Seller or
Seller’s liability for the Guarantied Obligations is otherwise limited in some
way, Guarantor nevertheless intends to be fully liable, to the full extent of
all of Guarantor’s assets, with respect to all the Guarantied Obligations, even
though Seller’s liability for the Guarantied Obligations may be less limited in
scope or less burdensome.  Guarantor
waives any defenses to this Guaranty arising or purportedly arising from the
manner in which Buyer and Seller enter into the Transactions or otherwise, or
any waiver of the terms of any Transaction Document by Buyer or other failure
of Buyer to require full compliance with the Transaction Documents.  Guarantor’s liability under this Guaranty
shall continue until all sums due under the Transaction Documents have been
paid in full and all other performance required under the Transaction Documents
has been rendered in full, except as expressly provided otherwise in this
Guaranty.  Guarantor’s liability under
this Guaranty shall not be limited or affected in any way by any impairment or
any diminution or loss of value of any Security whether caused by (a) hazardous
substances, (b) Buyer’s failure to perfect a security interest in any
Security, (c) any disability or other defense(s) of Seller, or (d) any
breach by Seller of any representation or warranty contained in any Transaction
Document.

 

7

 

7.                                       Waivers
of Rights and Defenses.  Guarantor waives any right to require
Buyer to (a) proceed against Seller, (b) proceed against or exhaust
any Security, or (c) pursue any other right or remedy for Guarantor’s
benefit.  Guarantor agrees that Buyer may
proceed against Guarantor with respect to the Guarantied Obligations without
taking any actions against Seller and without proceeding against or exhausting
any Security.  Guarantor agrees that
Buyer may unqualifiedly exercise in its sole discretion (or may waive or
release, intentionally or unintentionally) any or all rights and remedies
available to it against Seller without impairing Buyer’s rights and remedies in
enforcing this Guaranty, under which Guarantor’s liabilities shall remain
independent and unconditional.  Guarantor
agrees and acknowledges that Buyer’s exercise (or waiver or release) of certain
of such rights or remedies may affect or eliminate Guarantor’s right of
subrogation or recovery against Seller (if any) and that Guarantor may incur a
partially or totally nonreimbursable liability in performing under this
Guaranty.  Guarantor has assumed the risk
of any such loss of subrogation rights, even if caused by Buyer’s acts or
omissions.  If Buyer’s enforcement of
rights and remedies, or the manner thereof, limits or precludes Guarantor from
exercising any right of subrogation that might otherwise exist, then the
foregoing shall not in any way limit Buyer’s rights to enforce this
Guaranty.  Without limiting the
generality of any other waivers in this Guaranty, Guarantor expressly waives
any statutory or other right (except as set forth herein) that Guarantor might
otherwise have to:  (i) limit
Guarantor’s liability after a nonjudicial foreclosure sale to the difference
between the Guarantied Obligations and the fair market value of the property or
interests sold at such nonjudicial foreclosure sale or to any other extent, (ii) otherwise
limit Buyer’s right to recover a deficiency judgment after any foreclosure
sale, or (iii) require Buyer to exhaust its Security before Buyer may
obtain a personal judgment for any deficiency. 
Any proceeds of a foreclosure or similar sale may be applied first to
any obligations of Seller that do not also constitute Guarantied Obligations
within the meaning of this Guaranty. 
Guarantor acknowledges and agrees that any nonrecourse or exculpation
provided for in any Transaction Document, or any other provision of a
Transaction Document limiting Buyer’s recourse to specific Security or limiting
Buyer’s right to enforce a deficiency judgment against Seller or any other
person, shall have absolutely no application to Guarantor’s liability under
this Guaranty.

 

8.                                       Additional
Waivers.  Guarantor waives diligence and all demands, protests,
presentments and notices of every kind or nature, including notices of protest,
dishonor, nonpayment, acceptance of this Guaranty and the creation, renewal,
extension, modification or accrual of any of the Guarantied Obligations.  Guarantor further waives the right to plead
any and all statutes of limitations as a defense to Guarantor’s liability under
this Guaranty or the enforcement of this Guaranty.  No failure or delay on Buyer’s part in
exercising any power, right or privilege under this Guaranty shall impair or
waive any such power, right or privilege.

 

9.                                       Other
Actions Taken or Omitted.  Notwithstanding any other action taken or
omitted to be taken with respect to the Purchased Loan Documents, the
Guaranteed Obligations, or the security and collateral therefor, whether or not
such action or omission prejudices Guarantor or increases the likelihood that
Guarantor will be required to pay the Guaranteed Obligations pursuant to the
terms hereof, it is the unambiguous and unequivocal intention of Guarantor that
Guarantor shall be obligated to pay the Guaranteed Obligations when due,
notwithstanding any occurrence, circumstance, event, action, or omission
whatsoever, whether contemplated or uncontemplated, and whether or not
otherwise or particularly described herein,

 

8

 

which obligation shall be
deemed satisfied only upon the full and final payment and satisfaction of the
Guaranteed Obligations.

 

10.                                 No Duty to Prove
Loss.  To the extent that Guarantor at any time incurs any
liability under this Guaranty, Guarantor shall immediately pay Buyer (to be
applied on account of the Guarantied Obligations) the amount provided for in
this Guaranty, without any requirement that Buyer demonstrate that the Security
is inadequate for the Transactions; that Buyer has currently suffered any loss;
or that Buyer has otherwise exercised (to any degree) or exhausted any of Buyer’s
rights or remedies with respect to Seller or any Security.

 

11.                                 Full Knowledge.  Guarantor acknowledges, represents, and warrants that
Guarantor has had a full and adequate opportunity to review the Transaction
Documents, the transaction contemplated by the Transaction Documents, and all
underlying facts relating to such transaction. 
Guarantor represents and warrants that Guarantor fully understands:  (a) the remedies Buyer may pursue
against Seller and/or Guarantor in the event of a default under the Transaction
Documents, (b) the value (if any) and character of any Security, and (c) Seller’s
financial condition and ability to perform under the Transaction Documents.  Guarantor agrees to keep itself fully
informed regarding all aspects of the foregoing and the performance of Seller’s
obligations to Buyer.  Buyer has no duty,
whether now or in the future, to disclose to Guarantor any information
pertaining to Seller, the Transactions or any Security.  At any time provided for in the Transaction
Documents, Guarantor agrees and acknowledges that an Insolvency Proceeding
affecting Guarantor, or other actions or events relating to Guarantor
(including Guarantor’s death, disability, or change in financial position), as
set forth in the Transaction Documents, may be event(s) of default under
the Transaction Documents.

 

12.                                 Representations and
Warranties.  Guarantor acknowledges, represents and
warrants as follows, and acknowledges that Buyer is relying upon the following
acknowledgments, representations, and warranties by Guarantor in making the
Transactions:

 

(a)                                  Transaction
Documents.  This Guaranty has been duly authorized,
executed, and delivered, and is fully valid, binding, and enforceable against
Guarantor in accordance with its terms, subject to bankruptcy, insolvency, and
other limitations on creditors’ rights generally and to equitable principles.

 

(b)                                 No Conflict.  The execution, delivery, and performance of this Guaranty
do not violate any provision of any law, regulation, judgment, order, decree,
determination, or award of any court, arbitrator or governmental authority, or
of any mortgage, indenture, loan, or security agreement, lease, contract or
other agreement, instrument or undertaking, in any case, to which Guarantor is
subject or a party or that purports to bind Guarantor or any of Guarantor’s
property or assets.

 

(c)                                  No Third Party Consent
Required.  No consent of any person (including
creditors or partners, members, stockholders, or other owners of Guarantor),
other than those consents obtained of the date hereof, is required in
connection with Guarantor’s execution of this Guaranty or performance of
Guarantor’s obligations under this Guaranty. 
Guarantor’s execution of, and obligations under, this Guaranty are not
contingent upon any consent, license, permit, approval, or authorization of,
exemption by, notice or report to, or registration, filing, or 

 

9

 

declaration with, any
governmental authority, bureau, or agency, whether local, state, federal, or
foreign.

 

(d)                                 Authority
and Execution.  Guarantor has full power, authority, and
legal right to execute, deliver and perform its obligations under this Guaranty.  Guarantor has taken all necessary corporate
and legal action to authorize this Guaranty, which has been duly executed and
delivered and is a legal, valid, and binding obligation of guarantor,
enforceable in accordance with its terms.

 

(e)                                  No
Representations by Buyer.  Guarantor delivers this Guaranty based
solely upon Guarantor’s own independent investigation and based in no part upon
any representation or statement by Buyer.

 

(f)                                    No
Misstatements.  No information, exhibit, report or
certificate furnished by Guarantor to Buyer in connection with the Transactions
or any Transaction Document contains any material misstatement of fact or has
omitted to state a material fact or any fact necessary to make the statements
contained therein not materially misleading.

 

13.                                 Reimbursement
and Subrogation Rights.  Except to the extent that Buyer notifies
Guarantor to the contrary in writing from time to time:

 

(a)                                  General
Deferral of Reimbursement.  Guarantor waives any right to be
reimbursed by Seller for any payment(s) made by Guarantor on account of
the Guarantied Obligations, unless and until all Guarantied Obligations have
been paid in full.  Guarantor
acknowledges that Guarantor has received adequate consideration for execution
of this Guaranty by virtue of Buyer’s entering into the Transactions (which
benefits Guarantor, as an owner or principal of Seller) and Guarantor does not
require or expect, and is not entitled to, any other right of reimbursement
against Seller as consideration for this Guaranty.

 

(b)                                 Deferral
of Subrogation and Contribution.  Guarantor agrees it shall have no right
of subrogation against Seller or Buyer and no right of subrogation against any
Security unless and until:  (a) such
right of subrogation does not violate (or otherwise produce any result adverse
to Buyer under) any applicable law, including any bankruptcy or insolvency law;
and (b) all amounts due under the Transaction Documents have been paid in
full and all other performance required under the Transaction Documents has
been rendered in full to Buyer (such deferral of Guarantor’s subrogation and
contribution rights, the “Subrogation Deferral”).

 

(c)                                  Effect
of Invalidation.  To the extent that a court of competent
jurisdiction determines that Guarantor’s Subrogation Deferral is void or
voidable for any reason, Guarantor agrees, notwithstanding any acts or
omissions by Buyer that Guarantor’s rights of subrogation against Seller or
Buyer and Guarantor’s right of subrogation against any Security shall at all
times be junior and subordinate to Buyer’s rights against Seller and to Buyer’s
right, title, and interest in such Security.

 

(d)                                 Claims
in Insolvency Proceeding.  Until the Guarantied Obligations have
been paid and performed in full, Guarantor shall not file any claim in any Insolvency
Proceeding affecting Seller unless Guarantor simultaneously assigns and
transfers such claim to Buyer, without consideration, pursuant to documentation
fully satisfactory to Buyer.  Guarantor
shall 

 

10

 

automatically be deemed
to have assigned and transferred such claim to Buyer whether or not Guarantor
executes documentation to such effect, and by executing this Guaranty hereby
authorizes Buyer (and grants Buyer a power of attorney coupled with an interest,
and hence irrevocable) to execute and file such assignment and transfer
documentation on Guarantor’s behalf, provided that upon the payment and
performance in full of the Guarantied Obligations Buyer shall automatically be
deemed to have reassigned and retransferred such claim to Guarantor.  Buyer shall have the sole right to vote,
receive distributions, and exercise all other rights with respect to any such
claim, provided, however, that if and when the Guarantied Obligations have been
paid in full Buyer shall release to Guarantor any further payments received on
account of any such claim.

 

14.                                 Waiver
Disclosure.  Guarantor acknowledges that pursuant to
this Guaranty, Guarantor has waived a substantial number of defenses that
Guarantor might otherwise under some circumstance(s) be able to assert
against Guarantor’s liability to Buyer. 
Guarantor acknowledges and confirms that Guarantor has substantial
experience as a sophisticated participant in substantial commercial real estate
transactions and is fully familiar with the legal consequences of signing this
or any other guaranty.  In addition,
Guarantor is represented by competent counsel. 
Guarantor has obtained from such counsel, and understood, a full
explanation of the nature, scope, and effect of the waivers contained in this
Guaranty (a “Waiver Disclosure”).  In the
alternative, Guarantor has, with advice from such counsel, knowingly and
intentionally waived obtaining a Waiver Disclosure.  Accordingly Guarantor does not require or
expect Buyer to provide a Waiver Disclosure. 
It is not necessary for Buyer or this Guaranty to provide or set forth
any Waiver Disclosure, notwithstanding any principles of law to the
contrary.  Nevertheless, Guarantor
specifically acknowledges that Guarantor is fully aware of the nature, scope,
and effect of all waivers contained in this Guaranty, all of which have been
fully disclosed to Guarantor.  Guarantor
acknowledges that as a result of the waivers contained in this Guaranty:

 

(a)                                  Actions
by Buyer.  Buyer will be able to take a wide range
of actions relating to Seller, the Transactions, and the Transaction Documents,
all without Guarantor’s consent or notice to Guarantor.  Guarantor’s full and unconditional liability
under this Guaranty will continue whether or not Guarantor has consented to
such actions.  Guarantor may disagree
with or disapprove such actions, and Guarantor may believe that such actions
should terminate or limit Guarantor’s obligations under this Guaranty, but such
disagreement, disapproval, or belief on the part of Guarantor will in no way
limit Guarantor’s obligations under this Guaranty.

 

(b)                                 Interaction
with Seller Liability.  Guarantor shall be fully liable for all
Guarantied Obligations even if Seller has a full and complete defense to
liability whatsoever under the Transaction Documents or the Transaction
Documents are otherwise invalid, unenforceable, or subject to defenses
available to Seller.  Guarantor
acknowledges that Guarantor’s full and unconditional liability under this
Guaranty (with respect to the Guarantied Obligations as if they were fully
enforceable against Seller) will continue notwithstanding any such limitations
on or impairment of Seller’s liability.

 

(c)                                  Timing
of Enforcement.  Buyer will be able to enforce this
Guaranty against Guarantor even though Buyer might also have available other
rights and remedies that Buyer could conceivably enforce against the Security
or against other parties.  As a result,
Buyer 

 

11

 

may require Guarantor to
pay the Guarantied Obligations earlier than Guarantor would prefer to pay the
Guarantied Obligations, including immediately upon the occurrence of a default
by Seller.  Guarantor will not be able to
assert against Buyer various defenses, theories, excuses, or procedural
requirements that might otherwise force Buyer to delay or defer the enforcement
of this Guaranty against Guarantor. 
Guarantor acknowledges that Guarantor intends to allow Buyer to enforce the
Guaranty against Guarantor in such manner. 
All of Guarantor’s assets will be available to satisfy Buyer’s claims
against Guarantor under this Guaranty.

 

(d)                                 Continuation
of Liability.  Guarantor’s liability for the Guarantied
Obligations shall continue at all times until the Guarantied Obligations have
actually been paid in full, even if other circumstances have changed such that
in Guarantor’s view Guarantor’s liability under this Guaranty should terminate,
except to the extent that any express conditions to the termination of this
Guaranty, as set forth in this Guaranty, have been satisfied.

 

15.                                 Buyer’s
Disgorgement of Payments.  Upon payment of all or any portion of the
Guarantied Obligations, Guarantor’s obligations under this Guaranty shall
continue and remain in full force and effect if all or any part of such payment
is, pursuant to any Insolvency Proceeding or otherwise, avoided or recovered
directly or indirectly from Buyer as a preference, fraudulent transfer, or
otherwise, irrespective of (a) any notice of revocation given by Guarantor
prior to such avoidance or recovery, or (b) payment in full of the
Transactions.  Guarantor’s liability
under this Guaranty shall continue until all periods have expired within which
Buyer could (on account of Insolvency Proceedings, whether or not then pending,
affecting Seller or any other person) be required to return, repay, or disgorge
any amount paid at any time on account of the Guarantied Obligations.

 

16.                                 Right
to Set Off.  Notwithstanding anything to the contrary
contained herein, no provision of this Agreement shall be deemed to limit,
decrease or in any way diminish any rights of set-off Buyer may have with
respect to any cash, cash equivalents, certificates of deposit or the like
which may now or hereafter be put on deposit with Buyer by Seller or by
Guarantor.  Upon the occurrence and
during the continuance of any Event of Default, Buyer is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by Buyer to or for the credit or the account of Guarantor against any and all
of the obligations of Guarantor now or hereafter existing under this Guaranty and
the Guarantor Documents, irrespective of whether or not Buyer shall have made
any demand under this Guaranty or the Guarantor Documents and although such
obligations may be contingent and unmatured. 
Buyer agrees promptly to notify Guarantor after any set-off and
application, provided that the failure to give such notice shall not affect the
validity of such set-off and application or this Guaranty.  The rights of Buyer under this Paragraph 16
are in addition to other rights and remedies (including, without limitation,
other rights to set-off) which Buyer may have.

 

17.                                 Financial
Information.  Within ninety (90) days after the end of
each calendar year or other fiscal year of Guarantor (or within five business
days after filing, in the case of tax returns), and within five business days
after Buyer’s request made at any time or from time to time, Guarantor shall
deliver to Buyer:  (a) complete and
current financial statements of Guarantor prepared in accordance with GAAP, in
all material respects; (b) copies of Guarantor’s 

 

12

 

tax returns; and (c) such
other financial information relating to Guarantor and in Guarantor’s possession
as Buyer may reasonably request.

 

18.                                 Consent
to Jurisdiction.  Guarantor agrees that any Proceeding to
enforce this Guaranty may be brought in any state or federal court located in
the state of New York, as Buyer may select. 
By executing this Guaranty, Guarantor irrevocably accepts and submits to
the nonexclusive personal jurisdiction of each of the aforesaid courts,
generally and unconditionally with respect to any such Proceeding.  Guarantor agrees not to assert any basis for
transferring jurisdiction of any such proceeding to another court.  Guarantor further agrees that a final
non-appealable judgment against Guarantor in any Proceeding shall be conclusive
evidence of Guarantor’s liability for the full amount of such judgment.

 

19.                                 Merger;
No Conditions; Amendments.  This Guaranty and documents referred to
herein contain the entire agreement among the parties with respect to the
matters set forth in this Guaranty.  This
Guaranty supersedes all prior agreements among the parties with respect to the
matters set forth in this Guaranty.  No
course of prior dealings among the parties, no usage of trade, and no parol or
extrinsic evidence of any nature shall be used to supplement, modify, or vary
any terms of this Guaranty.  This
Guaranty is unconditional.  There are no
unsatisfied conditions to the full effectiveness of this Guaranty.  No terms or provisions of this Guaranty may
be changed, waived, revoked, or amended without Buyer’s written agreement.  If any provision of this Guaranty is
determined to be unenforceable, then all other provisions of this Guaranty
shall remain fully effective.

 

20.                                 Enforcement.  Guarantor acknowledges that this Guaranty is an “instrument
for the payment of money only,” within the meaning of New York Civil Practice
Law and Rules Section 3213.  In
the event of any Proceeding between Seller or Guarantor and Buyer, including
any Proceeding in which Buyer enforces or attempts to enforce this Guaranty or
the Transactions against Seller or Guarantor, or in the event of any Guarantor
Litigation, Guarantor shall reimburse Buyer for all Legal Costs of such Proceeding.

 

21.                                 Fundamental
Changes.  Guarantor shall not wind up, liquidate, or dissolve
its affairs or enter into any transaction of merger or consolidation, or sell,
lease, or otherwise dispose of (or agree to do any of the foregoing) all or
substantially all of its property or assets, without Buyer’s prior written
consent.

 

22.                                 Further
Assurances.  Guarantor shall execute and deliver such
further documents, and perform such further acts, as Buyer may reasonably
request to achieve the intent of the parties as expressed in this Guaranty,
provided in each case that any such documentation is consistent with this
Guaranty and with the Transaction Documents.

 

23.                                 Counterparts.  This Guaranty may be executed in counterparts, each of
which shall be considered one and the same agreement and this Guaranty shall
become effective when such counterparts have been signed by each of the parties
and delivered to the other parties, it being understood that the parties need
not sign the same counterpart.  Delivery
of an executed signature page of this Guaranty by facsimile or electronic
mail transmission shall be effective as delivery of a mutually executed
counterpart hereof.

 

13

 

24.                                 WAIVER
OF TRIAL BY JURY.  GUARANTOR WAIVES TRIAL BY JURY IN ANY ACTION
OR PROCEEDING ARISING FROM OR RELATING TO THIS GUARANTY OR THE TRANSACTION
DOCUMENTS OR ANY OBLIGATION(S) OF GUARANTOR HEREUNDER OR UNDER THE
TRANSACTION DOCUMENTS.

 

25.                                 Miscellaneous.

 

(a)                                  Assignability.  Buyer may assign this Guaranty (in whole or in part)
together with any one or more of the Transaction Documents, in accordance with
the terms of the Transaction Documents without in any way affecting Guarantor’s
or Seller’s liability.  Upon request in
connection with any such assignment Guarantor shall deliver such documentation
as Buyer shall reasonably request (at Buyer’s reasonable expense).  Buyer may from time to time designate any
Buyer Entity to hold and exercise any or all of Buyer’s rights and remedies
under this Guaranty.  This Guaranty shall
benefit Buyer and its successors and assigns (including any Buyer Entity) and
shall bind Guarantor and its successors, and assigns.  Guarantor may not assign this Guaranty in
whole or in part without the prior written consent of Buyer.

 

(b)                                 Notices.  All notices, requests and demands to be made under
this Guaranty shall be given in writing at the address set forth in the opening
paragraph of this Guaranty and shall be effective for all purposes if hand
delivered or sent by:  (i) hand delivery,
with proof of attempted delivery, (ii) certified or registered United
States mail, postage prepaid, (iii) expedited prepaid delivery service,
either commercial or United States Postal Service, with proof of attempted
delivery, or (iv) by telecopier (with answerback acknowledged) provided
that such telecopied notice must also be delivered by one of the means set
forth in (i), (ii) or (iii) above, to the address set forth in the
opening paragraph of this Guaranty or at such other address and person as shall
be designated from time to time by any party hereto, as the case may be, in a
written notice to the other parties hereto in the manner provided for in this Section 25(b).  Any notice, request or demand shall be deemed
to have been given:  (i) in the case
of hand delivery, at the time of delivery, (ii) in the case of registered
or certified mail, when first delivered or the first attempted delivery on a
business day, (iii) in the case of expedited prepaid delivery upon the
first attempted delivery on a business day, or (iv) in the case of
telecopier, upon receipt of answerback confirmation, provided that such
telecopied notice was also delivered as required in this Section 25(b).

 

(c)                                  Interpretation.  This Guaranty shall be enforced and interpreted according
to the laws of the state of New York, disregarding its rules on conflicts
of laws.  The word “include” and its
variants shall be interpreted in each case as if followed by the words “without
limitation.”

 

(d)                                 Obligations Joint and
Several.  Notwithstanding anything to the contrary herein, the
representations, warranties, covenants, agreements and obligations made and
undertaken by Guarantor herein shall be joint and several.

 

26.                                 Business Purposes.  Guarantor acknowledges that this Guaranty is executed
and delivered for business and commercial purposes, and not for personal,
family, household, consumer, or agricultural purposes.  Guarantor acknowledges that Guarantor is not
entitled to, and does not require the benefits of, any rights, protections, or disclosures
that would or may be 

 

14

 

required if this Guaranty
were given for personal, family, household, consumer, or agricultural
purposes.  Guarantor acknowledges that
none of Guarantor’s obligation(s) under this Guaranty constitute(s) a
“debt” within the meaning of the United States Fair Debt Collection Practices
Act, 15 U.S.C. § 1692a(5), and accordingly compliance with the requirements of
such Act is not required if Buyer (directly or acting through its counsel)
makes any demand or commences any action to enforce this Guaranty.

 

27.                                 No Third-Party
Beneficiaries.  This Guaranty is executed and delivered
for the benefit of Buyer and its successors, and assigns, and is not intended
to benefit any third party.

 

28.                                 CERTAIN
ACKNOWLEDGMENTS BY GUARANTOR.  GUARANTOR ACKNOWLEDGES THAT
BEFORE EXECUTING THIS GUARANTY:  (A) GUARANTOR
HAS HAD THE OPPORTUNITY TO REVIEW IT WITH AN ATTORNEY OF GUARANTOR’S CHOICE; (B) BUYER
HAS RECOMMENDED TO GUARANTOR THAT GUARANTOR OBTAIN SEPARATE COUNSEL,
INDEPENDENT OF SELLER’S COUNSEL, REGARDING THIS GUARANTY; AND (C) GUARANTOR
HAS CAREFULLY READ THIS GUARANTY AND UNDERSTOOD THE MEANING AND EFFECT OF ITS
TERMS, INCLUDING ALL WAIVERS AND ACKNOWLEDGMENTS CONTAINED IN THIS GUARANTY AND
THE FULL EFFECT OF SUCH WAIVERS AND THE SCOPE OF GUARANTOR’S OBLIGATIONS UNDER
THIS GUARANTY.

 

15

 

IN WITNESS WHEREOF, Guarantor has duly executed this Guaranty
as of the date indicated below.

 

 

	
   

  	
  GUARANTOR:

  
	
   

  	
   

  
	
   

  	
  KW
  PROPERTY FUND III, L.P.,

  
	
   

  	
  a
  Delaware limited partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Kennedy-Wilson
  Property Services III, Inc.,

  a Delaware corporation,

  
	
   

  	
   

  	
  its
  sole general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  John Prabhu

  
	
   

  	
   

  	
  Name:

  	
  John
  Prabhu

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KENNEDY-WILSON,
  INC.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  unknown

  
	
   

  	
  Name:

  	
  unknown

  
	
   

  	
  Title:

  	
  CFO

  
	
   

  	
   

  
	
  Acknowledgements:

  	
   

  
	
   

  	
   

  
	
  DEUTSCHE
  BANK AG, CAYMAN

  	
   

  
	
  ISLANDS
  BRANCH

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Thomas R.

  	
   

  
	
   

  	
  Name:
   Thomas R.

  	
   

  
	
   

  	
  Title:
   Director

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Christine Belbusti

  	
   

  
	
   

  	
  Name:
   Christine Belbusti

  	
   

  
	
   

  	
  Title:  Director

  	
   

  
						

 

16Exhibit 10.114

 

PAYMENT GUARANTY

 

by

 

KENNEDY-WILSON, INC.,

 

as Guarantor

 

in favor of

 

THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA

 

as Lender

 

Dated: As of June , 2009

 

 

Location: 3810 Wilshire Boulevard, Los Angeles, CA
90010

 

 

THIS PAYMENT GUARANTY (as amended, modified, restated
or supplemented from time to time, this “Guaranty”) is made as of the day of
June, 2009, by KENNEDY- WILSON, INC. a Delaware corporation, having an address
at 9601 Wilshire Boulevard, Suite 220, Beverly Hills, California 90210 (“Guarantor”),
in favor of THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA, a New York
corporation, having an address at 7 Hanover Square, New York, New York 10004 (“Lender”).

 

RECITALS

 

A.                                   Lender is simultaneously herewith making
the loan to Borrower (as defined in the Security Instrument, which term is
defined below) in the original principal amount of $28,000,000.00 (the “Loan”),
which Loan is evidenced by two promissory notes, one in the original principal
amount of $20,000,000 and the second in the original principal amount of
$8,000,000, each dated the date hereof, made by Borrower and payable to Lender
in the principal amount of the Loan (as amended, modified, extended, renewed,
restated or supplemented from time to time, collectively, the “Note”).

 

B.                                     The Loan is secured by, among other
things, that certain DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT AND FINANCING STATEMENT dated as of the date hereof (as amended,
restated, supplemented or otherwise modified from time to time, the “Security
Instrument”), which also secures the payment and performance of all other
Obligations, as defined in the Security Instrument.

 

C.                                     For purposes of this Guaranty, the
capitalized terms used herein without definition shall have the respective meanings
set forth for such terms in Annex A to the Security Instrument, and the rules of
interpretation set forth in such Annex A of the Security Instrument shall
govern the interpretation of this Guaranty.

 

D.                                    As a material inducement for, and as a
condition precedent to Lender’s making the Loan, Guarantor is required to
execute and deliver to Lender this Guaranty.

 

ARTICLE I- GUARANTY

 

Section 1.01                            The Guaranty. In consideration
of the loans, advances, extensions of credit and financial accommodations heretofore
or hereinafter at any time made or afforded by Lender to Borrower in connection
with the Loan and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor hereby unconditionally
and irrevocably guarantees, without limit, the full and prompt payment when due
of all payment Obligations of Borrower to Lender set forth in the Security
Instrument, and payment of any monetary obligations arising as a result of
Borrower’s failure to perform any nonmonetary obligations set forth in the
Security Instrument (such guaranteed obligations being hereinafter referred to
as the “Liabilities”).

 

2

 

Section 1.02                            Liabilities Guaranteed.

 

(a)                                  In the event Borrower fails at any time
to pay any part or all of the Liabilities guaranteed when due, whether by
acceleration or otherwise, Guarantor, upon demand of Lender, shall pay the
Liabilities in the same manner as if they constituted the direct and primary
obligation of Guarantor, and such obligation of Guarantor shall be due with
costs of collection, Reasonable Attorneys Fees and without relief from
valuation or appraisement laws.

 

(b)                                 The obligations of Guarantor hereunder
shall in no way be affected or impaired by any provision in any instrument
evidencing or securing the Loan whereby Lender agrees not to seek or enforce
any personal liability against Borrower, or any provision of like effect, or
whereby Lender agrees to look solely to any collateral for the enforcement or
satisfaction of the Loan or the obligations arising under the instruments
evidencing or securing the Loan, or any provision of like effect.

 

ARTICLE II- WAIVERS AND CONSENTS

 

Section 2.01                            General Waivers of Guarantor.
Guarantor hereby waives each of the following:

 

(i)                                     notice of acceptance of this Guaranty,
notice of the existence or creation of all or any of the Liabilities, notice of
any extension of credit, advances, loan or similar accommodation by Lender to
Borrower, and notice of the amount of the Liabilities which may exist from time
to time;

 

(ii)                                  presentment, demand, protest, notice of
protest, notice of dishonor, notice of nonpayment or of other default with
respect to any of the Liabilities, and all other notices whatsoever;

 

(iii)                               any requirement that Lender institute
suit, or otherwise exhaust its rights or remedies against Borrower or against
any other person, guarantor, or under the Security Instrument or other
collateral guaranteeing or securing all or any part of the Liabilities (the obligations
of such guarantors or other persons and such Security Instrument or other
collateral security being hereinafter referred to as the “Collateral”), prior
to enforcing any rights it has under this Guaranty or otherwise against
Guarantor, or to pursue any other remedy it may now or hereafter have against
Borrower, or (if Borrower is a partnership) any general partner of Borrower,
including any and all benefits under California Civil Code Sections 2845, 2849
and 2850;

 

(iv)                              all diligence in collection, protection
of, or realization upon the Collateral or any other security for any of the
Liabilities;

 

(v)                                 any right of subrogation with respect to
the Liabilities or the Collateral, any right to enforce any remedy which Lender
now has or hereafter may have against Borrower, and any right to participate in
any security now or hereafter held by Lender, until Lender shall have received
payment in full of the Liabilities;

 

3

 

(vi)                              any defense or right of setoff based on
the deterioration in market or other value, waste, loss by fire, theft, loss or
substitution of any property which is a part of the Collateral;

 

(vii)                           any defenses arising out of the absence,
impairment or loss of any right of reimbursement or subrogation or other right
or remedy of Guarantor against Borrower or against any security resulting from
the exercise or election of any remedy or remedies by Lender, including without
limitation the exercise of the power of sale under the Security Instrument, and
any defense arising by reason of any disability or other defense of Borrower or
by reason of the cessation, from any cause, of the liability of Borrower;

 

(viii)                        any defense based upon Lender’s failure
to disclose to Guarantor any information concerning Borrower’s financial
condition or any other circumstances bearing on Borrower’s ability to pay all
sums payable under the Note or any of the other Loan Documents;

 

(ix)                                any defense based upon any legal
disability or other defense of Borrower, any other guarantor of other person,
or by reason of the cessation or limitation of the liability of Borrower from
any cause other than full payment of all sums payable under the Note or any of
the other Loan Documents;

 

(x)                                   any defense based upon any lack of authority
of the officers, directors, partners or agents acting or purporting to act on
behalf of Borrower or any principal of Borrower or any defect in the formation
of Borrower or any principal of Borrower;

 

(xi)                                any defense based upon the application by
Borrower of the proceeds of the Loan for purposes other than the purposes
represented by Borrower to Lender or intended or understood by Lender or
Guarantor;

 

(xii)                             any defense based upon any statute or rule of
law which provides that the obligation of a surety must be neither larger in
amount nor in any other respects more burdensome than that of a principal;

 

(xiii)                          any defense based upon Lender’s election,
in any proceeding instituted under the Federal Bankruptcy Code, of the
application of Section 1111(b)(2) of the Federal Bankruptcy Code or
any successor statute;

 

(xiv)                         any defense based upon any borrowing or
any grant of a security interest under Section 364 of the Federal
Bankruptcy Code;

 

(xv)                            the failure to take any action permitted
hereunder, or the waiver of any conditions hereinabove set forth by Lender or
any person acting on behalf of Lender shall in no way affect, diminish or
release the obligations of Guarantor hereunder; and

 

4

 

(xvi)                         the rights, benefits and defenses arising
from alteration, impairment or suspension in any respect or by any means of any
of Borrower’s obligations under the Loan Documents or any of Lender’s rights or
remedies under the Loan Documents without Guarantor’s prior consent.

 

(xvii)                      The rights, benefits and defenses arising
out of or under California Civil Code Section 2819 resulting from
alteration, impairment or suspension in any respect or by any means of any of
Borrower’s obligations under the Loan Documents or any of lender’s rights or
remedies under the Loan Documents without Guarantor’s prior consent.

 

(xviii)                   In accordance with Section 2856 of the California
Civil Code, Guarantor waives any and all other rights of subrogation,
reimbursement, indemnification, contribution, and any other rights and defenses
available to Guarantor by reason of Sections 2787 through 2855, inclusive, of
the California Civil Code, including any and all rights or defenses Guarantor
may have by reason of protection afforded to Borrower with respect to any of
the obligations of Guarantor under this Guaranty pursuant to the antideficiency
or other laws of the State of California limiting or discharging Borrower’s
Indebtedness, including Sections 580a, 580b, 580d, and 726 of the California
Code of Civil Procedure. Likewise, Guarantor waives any and all rights and
defenses available to Guarantor under California Civil Code Sections 2899 and
3433. Without limiting the generality of the foregoing, Guarantor hereby
expressly waives any and all benefits under (i) California Code of Civil
Procedure Section 580a (which Section, if Guarantor had not given this
waiver, would otherwise limit Guarantor’s liability after a nonjudicial
foreclosure sale to the difference between the obligations of Guarantor under
this Guaranty and the fair market value of the property or interests sold at
such nonjudicial foreclosure sale), (ii) California Code of Civil
Procedure Sections 580b and 580d (which Sections, if Guarantor had not given
this waiver, would otherwise limit Lender’s right to recover a deficiency
judgment with respect to purchase money obligations and after a nonjudicial
foreclosure sale, respectively), and (iii) California Code of Civil
Procedure Section 726 (which Section, if Guarantor had not given this waiver,
among other things, would otherwise require Lender to exhaust all of its
security before a personal judgment could be obtained for a deficiency).
Notwithstanding any foreclosure of the lien of the Instrument, whether by the
exercise of the power of sale contained in the Instrument, by an action for
judicial foreclosure or by Lender’s acceptance of a deed in lieu of
foreclosure, Guarantor shall remain bound under this Guaranty.

 

(xix)                           Guarantor shall have no right of and
hereby waives any claim for, subrogation, reimbursement, indemnification, and
contribution against Borrower and against any general partner, member or other
constituent of Borrower, and against any other person or any collateral or
security for the Indebtedness (including without limitation any such rights
pursuant to Sections 2847 and 2848 of the California Civil Code), until the
Indebtedness has been indefeasibly paid and satisfied in full, all obligations
owed to Lender under the Loan Documents have been fully performed, and Lender has
released, transferred or disposed of all of its right, title and interest in
such collateral or security, and there has expired the maximum possible period
thereafter 

 

5

 

during which any payment
made by Borrower or others to Lender with respect to the Indebtedness could be
deemed a preference under the United States Bankruptcy Code.

 

Section 2.02                            Specific Waivers Related to Real Estate. Without limiting
any other provisions of this Guaranty:

 

(i)                                     Guarantor unconditionally and irrevocably
waives all rights and defenses that Guarantor may have because the Debt is
secured by real property. This means, among other things, that Lender may
collect from Guarantor without first foreclosing on any real or personal property
collateral pledged by Borrower. If Lender forecloses on any real property
collateral pledged by Borrower:

 

(A)                              the amount of the Debt may be reduced
only by the price for which that collateral is sold at the foreclosure sale,
even if the collateral is worth more than the sale price;

 

(B)                                Lender may collect from Guarantor even if
Lender, by foreclosing on the real property collateral, has destroyed any right
Guarantor may have to collect from Borrower; (This waiver being acknowledged by
Guarantor to be an unconditional and irrevocable wavier of any rights and
defenses Guarantor may have because the Debt is secured by real property); and

 

This is an unconditional and irrevocable waver of any
rights and defenses Guarantor may have because Borrower’s debt is secured by
real property. These rights and defenses include, but are not limited to, any
rights or defenses based upon Section 580a, 580b, 580d, or 726 of the
California Code of Civil Procedure.

 

(ii)                                  In accordance with Section 2856 of
the California Civil Code, Guarantor waives all rights and defenses arising out
of an election of remedies by Lender, even though that election of remedies,
such as nonjudicial foreclosure with respect to security for a guaranteed
obligation, has destroyed Guarantor’s rights of subrogation and reimbursement
against the principal by operation of Section 580d of the California Code
of Civil Procedure or otherwise.

 

Section 2.03                            Consent to Jurisdiction. Guarantor hereby
expressly agrees that any legal action or proceeding with respect to this
Guaranty may be brought in the courts of the State of New York, and, by
execution and delivery of this Guaranty, Guarantor hereby irrevocably accepts
for itself and in respect of its property, generally and unconditionally, the
jurisdiction to the aforesaid courts. Guarantor hereby further irrevocably
waives any claim that any such courts lack personal jurisdiction over the
Guarantor, and agrees not to plead or claim, in any legal action or proceeding
with respect to this Guaranty or any of the other Loan Documents brought in any
of the aforementioned courts, that such courts lack personal jurisdiction over
the Guarantor. Guarantor further irrevocably consents to the service of process
out of any of the aforementioned courts in any such action or proceeding by, in
addition to such other methods as are permitted under applicable laws, the
mailing of copies thereof by registered or certified mail, postage prepaid, to
Guarantor at its address for notice 

 

6

 

purposes pursuant to ARTICLE IV hereof, such service to
become effective thirty (30) days after such mailing. Guarantor hereby
irrevocably waives any objection to such service of process and further
irrevocably waives and agrees not to plead or claim in any action or proceeding
commenced hereunder that service of process was in any way invalid or
ineffective. Nothing herein shall affect the right of Lender to serve process
in any other manner permitted by law or to commence legal proceedings or otherwise
proceed against Guarantor in any other jurisdiction.

 

Section 2.04                            Waiver of Objection
to Venue; Forum Non Conveniens. Guarantor hereby
irrevocably waives any objection which it may now or hereafter have to the
laying of venue of any of the aforesaid actions or proceedings arising out of
or in connection with this Guaranty or any of the other Loan Documents brought
in the courts referred to in Section 2.03 above and hereby further
irrevocably waives and agrees not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum.

 

Section 2.05                            Waiver of Right to Jury Trial; Waiver of Statute of
Limitations. GUARANTOR AND LENDER EACH WAIVES ALL
RIGHTS TO TRIAL BY JURY OF ANY SUITS, CLAIMS, COUNTERCLAIMS, ACTIONS OR OTHER
PROCEEDINGS OF ANY KIND ARISING UNDER OR RELATING TO THE NOTE, THE SECURITY
DOCUMENT, THIS GUARANTY AND ANY OF THE OTHER LOAN DOCUMENTS AND THE LOAN
EVIDENCED AND SECURED THEREBY (INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR
FUTURE MODIFICATION THEREOF) OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO
THE LOAN DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION THEREWITH, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. GUARANTOR AND
LENDER EACH ACKNOWLEDGES THAT THIS IS A WAIVER OF A LEGAL RIGHT AND REPRESENTS
TO THE OTHER THAT THIS WAIVER IS MADE KNOWINGLY AND VOLUNTARILY. GUARANTOR AND
LENDER EACH AGREES THAT ALL SUCH SUITS, CLAIMS COUNTERCLAIMS, ACTIONS OR OTHER
PROCEEDINGS SHALL BE TRIED BEFORE A JUDGE OF A COURT OF COMPETENT JURISDICTION,
WITHOUT A JURY. GUARANTOR AND LENDER EACH AGREES THAT THIS PARAGRAPH
CONSTITUTES WRITTEN CONSENT THAT TRIAL BY JURY SHALL BE WAIVED IN ANY SUCH
SUIT, CLAIM, COUNTERCLAIM, ACTION OR OTHER PROCEEDING AND AGREE THAT GUARANTOR
AND LENDER EACH SHALL HAVE THE RIGHT AT ANY TIME TO FILE THE SECURITY DOCUMENT
WITH THE CLERK OR JUDGE OF ANY COURT IN WHICH ANY SUCH SUIT, CLAIM,
COUNTERCLAIM, ACTION OR OTHER PROCEEDING MAY BE PENDING AS STATUTORY
WRITTEN CONSENT TO WAIVER OF TRIAL BY JURY. GUARANTOR HEREBY WAIVES THE BENEFIT
OF ANY STATUTE OF LIMITATIONS AFFECTING THE LIABILITY OF GUARANTOR UNDER THIS
GUARANTY.

 

7

 

ARTICLE III- FURTHER AGREEMENTS OF PARTIES

 

Section 3.01                            Rights of
Lender. Lender
shall have the right without demand of or notice to Guarantor to deal in any
manner with the Liabilities and the Collateral, including without limitation
the right to:

 

(i)                                     at any time, when any amount shall be due
and payable hereunder by Guarantor, appropriate and apply toward the payment of
such amount, and in such order of application as Lender may from time to time
elect, any property or monies of Guarantor in the possession or control of
Lender;

 

(ii)                                  credit payments or other amounts received
from whatsoever source in such manner and in such order of application as
Lender may from time to time elect;

 

(iii)                               take and hold a security interest in any
additional property to secure the Loan, any of the Liabilities or any
obligation arising hereunder;

 

(iv)                              require, take and hold as additional
security for the Loan the primary or secondary liability of any party or
parties, in addition to Guarantor, with respect to any of the Liabilities;

 

(v)                                 extend or renew for any period (whether
or not longer than the original period), alter or exchange any of the
Liabilities, and forbear to take steps to enforce the payment of all or any
part thereof against Borrower;

 

(vi)                              release or compromise any liability of
Guarantor hereunder or any liability of any other party or parties primarily or
secondarily liable with respect to any of the Liabilities;

 

(vii)                           resort to Guarantor for payment of all or
any of the Liabilities, whether or not Lender shall have resorted first to any
property or shall have proceeded against any other guarantors or any other
party primarily or secondarily liable with respect to any of the Liabilities;

 

(viii)                        modify or otherwise change the terms or
alter any of the terms of the Security Instrument, the Note or any other Loan
Documents, including without limitation making further advances under the Note,
increasing or decreasing the amount of the Debt, changing the rate of interest
on the Loan or affecting any release, compromise or settlement thereof or with
respect thereto;

 

(ix)                                forbear from calling for additional
collateral, and consent to the substitution or release of all or any part of
the Collateral, whether or not of the same or different character or value than
the Collateral surrendered by Lender;

 

(x)                                   transfer, assign or negotiate the Note
and transfer and assign the Security Instrument or any other of the Loan
Documents; and

 

8

 

(xi)                                file or refrain from filing a claim in
any bankruptcy proceeding of or affecting Borrower or any other guarantor or pledgor
or the property of any of them.

 

The obligations of
Guarantor hereunder shall not be released, discharged or affected in any way
nor shall Guarantor have any recourse against Lender by reason of any action
which Lender may take or omit to take under these powers or otherwise existing
with respect to the Liabilities or the Collateral.

 

Section 3.02                            Annual Financial Reports of Guarantor. Guarantor agrees to furnish to Lender,
prior to [March 31st] of
each year an annual financial statement for Guarantor certified as true and
correct by Guarantor and in form and substance satisfactory to Lender; provided
that, following an Event of Default under the Loan Documents, such financial
statements, at Lender’s request, shall be provided to Lender and audited by an
independent certified public accountant satisfactory to Lender.

 

Section 3.03                            Joint and Several Liability. If this Guaranty
is executed by more than one party, each undersigned party agrees that it, he
or she is jointly and severally liable for all obligations of Guarantor
hereunder. If for any reason this Guaranty is held to be unenforceable against
any of the individuals or entities comprising Guarantor, such unenforceability
shall not affect the obligations of the remaining individuals or entities comprising
Guarantor hereunder, and each Guarantor hereby agrees that suit may be brought
against each Guarantor individually to enforce the terms and conditions of this
Guaranty. Further, the obligations of Guarantor arising under this Guaranty and
of Borrower with respect to all amounts guaranteed shall be the joint and
several obligations of Guarantor and Borrower, with the result that, in an
Event of Default (as defined in the Security Instrument), Lender may, if it so
elects, bring a single action against Guarantor and Borrower for the
Liabilities.

 

ARTICLE IV- NOTICES

 

Any notice, request, demand, consent, approval or
other communication required or desired to be given or delivered under this
Guaranty shall be made in accordance with the notice provisions of the Security
Instrument.

 

ARTICLE V- SUBORDINATION, REINSTATEMENT; SURVIVAL

 

Section 5.01                            Subordination. Any indebtedness of Borrower now or
hereafter held by Guarantor is hereby subordinated to the Debt, and such
indebtedness of Borrower to Guarantor, if Lender, after the occurrence and
during the continuance of an Event of Default, so requests, shall be collected,
enforced and received by Guarantor as trustee for Lender and be paid over to
Lender on account of the Debt, but without affecting or impairing in any manner
the liability of Guarantor under the provisions of this Guaranty. Without
limiting the generality of the foregoing, Guarantor hereby agrees with Lender
that it will not exercise any right of subrogation which it may at any time
otherwise have as a result of this Guaranty (whether contractual, under Section 509
of the Bankruptcy Code or otherwise) until all Liabilities have been
irrevocably paid in full.

 

9

 

Section 5.02                            Liabilities Reinstated. If claim is ever
made upon Lender for repayment or recovery of any amount or amounts received in
payment or on account of any of the Liabilities and Lender repays all or part
of said amount by reason of (i) any judgment, decree or order of any court
or administrative body having jurisdiction over Lender or any of its property
or (ii) any settlement or compromise of any such claim effected by Lender
with any such claimant (including Borrower), then Guarantor shall be and remain
jointly and severally liable to Lender hereunder for the amount so repaid or
recovered to the same extent as if such amount had never originally been
received by Lender.

 

Section 5.03                            Survival of Obligations.
If all or any portion of the Liabilities are paid, the
obligations of Guarantor hereunder shall continue and shall remain in full
force and effect in the event that all or any part of such payment is required
to be repaid as described in Section 5.02 above or such payment is avoided
or recovered directly or indirectly from Lender as a preference, fraudulent
transfer or otherwise under the Bankruptcy Code or any other Federal or state
laws, irrespective of (a) any notice of revocation given by Guarantor
prior to such avoidance or recovery, and (b) full payment and performance
of all of the Obligations.

 

ARTICLE VI- REPRESENTATIONS

 

Section 6.01                            RICO. Neither Guarantor, nor any principal,
officer, director, general partner or member of Guarantor, nor any Person if
Guarantor or any party constituting Guarantor is an entity, that directly or
indirectly controls, is controlled by, is associated with or is under common
control with Guarantor:

 

(i)                                     is or is reputed to be a target of or a
potential witness in any criminal investigation proceeding, or any
investigation or proceeding based upon the Racketeer Influenced and Corruption
Organizations Act (“RICO”);

 

(ii)                                  has been charged in any litigation or
other action or proceeding with any violations of any criminal statute (other
than a traffic offense) or RICO;

 

(iii)                               has been convicted of any crime or found
to have engaged in conduct prohibited by RICO; or

 

(iv)                              is an organized crime figure or is
reputed to have substantial business or other affiliations with any organized
crime figure.

 

Section 6.02                            Bankruptcy. Neither Guarantor, nor, if Guarantor is
an entity, any principal, officer, director, general partner or member of
Guarantor, nor any Person that directly or indirectly controls Guarantor or
owns any interest in Guarantor has been:

 

(i)                                     the debtor in any bankruptcy proceeding
or

 

(ii)                                  a defendant in any action or proceeding
involving allegations of fraud, intentional misrepresentation or other acts of
moral turpitude and 

 

10

 

relating, directly or
indirectly, to (a) the ownership, operation, maintenance or management of
real property or any interest therein, including the leasing thereof or (b) any
business, profession, trade or other commercial practice, activity, enterprise
or venture.

 

Section 6.03                            Anti-Terrorism. Guarantor
represents to, warrants to, and covenants with Lender, that as of the date of
the Loan Commitment and for the term of this Guaranty the following statements
were and shall be, respectively, true, correct and complete without material
misrepresentation or omission:

 

(i)                                     (1) each of Guarantor and its
principals, officers, directors, shareholders, partners, members and affiliates
is and will continue to be in compliance with the Anti-Terrorism Laws (as
hereinafter defined);

 

(ii)                                  each of Guarantor and its principals,
officers, directors, shareholders, partners, members and affiliates has
established policies and procedures designed to prevent and detect money
laundering, including processes to meet all applicable anti-money laundering
requirements of the USA Patriot Act (as hereinafter defined);

 

(iii)                               each of Guarantor and its principals,
officers, directors, shareholders, partners, members and affiliates has
identified, and will continue to identify, the entities with whom it does
business, and will retain all documentation necessary to identify those
entities and their sources of funds;

 

(iv)                              each of Guarantor and its principals,
officers, directors, shareholders, partners, members and affiliates is not, and
will not be, a Prohibited Person (as defined below);

 

(v)                                 each of Guarantor and its principals,
officers, directors, shareholders, partners, members and affiliates does not
and will not (i) conduct any business or engage in any transaction or
dealing with any Prohibited Person or (ii) deal in, or otherwise engage in
any transaction relating to, any property or interests in property blocked
pursuant to Executive Order 13224 (as defined below);

 

(vi)                              the following terms shall have the
following meanings:

 

(A)                              “Anti-Terrorism Laws” means any laws
related to terrorism or money laundering, including Executive Order 13224 and
the USA Patriot Act, and any regulations promulgated under either of them.

 

(B)                                “Executive Order 13224” shall mean
Executive Order Number 13224 on Terrorism Financing, effective September 24,
2001.

 

(C)                                “Prohibited Person” shall mean (A) a
person or entity subject to the provisions of Executive Order 13224; (B) a
person or entity owned or controlled by, or acting for or on behalf of, an
entity that is subject to the provisions of Executive Order 13224; (C) a
person or entity with whom 

 

11

 

Guarantor, its
principals, officers, directors or affiliates or Lender is prohibited from
dealing by any of the Anti- Terrorism Laws; (D) a person or entity that
commits, threatens or conspires to commit or supports “terrorism” as defined in
Executive Order 13224; (E) a person or entity that is named as a “specially
designated national and blocked person” on the most current list published by
the U.S. Treasury Department’s Office of Foreign Assets Control; or (F) a
person or entity who is affiliated with a person or entity described in clauses
(A) through (F) of this paragraph.

 

(D)                               “USA Patriot Act” shall mean the Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism Act of 2001, H.R. 3162, Public Law 107-56, as may be
amended from time to time.

 

ARTICLE VII- MISCELLANEOUS

 

Section 7.01                            Successors and Assigns. This Guaranty
shall bind Guarantor and the heirs, devisees, personal representatives,
successors and assigns of Guarantor and shall inure to the benefit of Lender,
all successors and assigns of Lender and all transferees of Lender’s interests
under the Loan Documents; it being agreed that Lender may, without notice of
any kind, sell, assign or transfer all or any of the Liabilities and in such
event, each and every immediate and successor assignee, transferee or holder of
all or any of the Liabilities, shall have the right to enforce this Guaranty by
suit or otherwise for the benefit of such assignee, transferee or holder, as
fully as if such assignee, transferee or holder were herein by name
specifically given such, rights, powers and benefits; provided that Lender
shall have the unimpaired right, prior and superior to that of any such
assignee, transferee or holder, to enforce this Guaranty for the benefit of
Lender as to so much of the Liabilities as it has not sold, assigned or
transferred.

 

Section 7.02                            No Waiver. No delay on the part of Lender in the
exercise of any right or remedy shall operate as a waiver thereof, and no
single or partial exercise by Lender of any right or remedy shall preclude any
other or further exercise thereof or the exercise of any other right or remedy.
No action of Lender permitted hereunder shall in any way impair or affect this
Guaranty.

 

Section 7.03                            Governing Law. This Guaranty shall be governed by and
construed and interpreted in accordance with the laws of the state in which the
Property is located.

 

Section 7.04                            Severability. If any provision hereof is determined to
be held illegal, unenforceable or void for any reason, then, the validity of
the remaining provisions hereof shall not be affected thereby.

 

Section 7.05                            Costs and Expense. Guarantor agrees to pay all
Reasonable Attorneys’ Fees and other costs and expenses which may be incurred
by Lender in the enforcement of this Guaranty, including without limitation
those incurred in connection with any case, action, proceeding, claim or
otherwise under Chapters 7, 11 or 13 of the 

 

12

 

Bankruptcy Code or any successor statute or statutes thereto
whether the same be commenced or filed by Borrower, Guarantor or any other
person or entity.

 

Section 7.06                            Counterparts. This Guaranty may be executed by the
parties hereto in any number of counterparts and each such counterpart shall be
deemed to be an original and all of which together shall constitute one and the
same agreement.

 

Section 7.07                            Counterparts. Upon payment to Lender of the full amount
of the Debt and performance of all Obligations, as evidenced by a duly recorded
release or reconveyance of the Security Instrument, this Guaranty shall be of
no further force or effect.

 

Section 7.08                            Independent Obligation. Anything in this
Guaranty to the contrary notwithstanding, all obligations of Guarantor under
this Guaranty (i) are not secured by the Security Document securing the
Note; and (ii) shall survive the repayment of the Note as collateral for
the Loan, or any transfer of the Property by foreclosure or by a deed in lieu
of foreclosure or otherwise.

 

Section 7.09                            Time of Essence.
Time is of the essence in the performance of each and every
provision of this Guaranty.

 

Section 7.10                            Recitals, Exhibits, Etc. The recitals set
forth in this Guaranty and all exhibits and attachments to this Guaranty are
incorporated herein and shall be deemed an integral part of this Guaranty.

 

[signatures on following page]

 

13

 

THIS GUARANTY is being
executed and delivered as of the day and year first above written.

 

 

	
   

  	
  GUARANTOR:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KENNEDY-WILSON,
  INC.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Freeman
  Lyle

  
	
   

  	
  Name:
  Freeman Lyle

  
	
   

  	
  Title: CFO

  

 

Signature
Page

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}]]