Document:

Exhibit 10.1

PROMISSORY
NOTE

September 29, 2006

(Date)

FOR VALUE RECEIVED, Maui Pineapple Company, Ltd., a corporation
located at the address stated below (“Maker”)
promises, jointly and severally if more than one, to pay to the order of GE Capital Public Finance, Inc. or any
subsequent holder hereof (each, a “Payee”)
at its office located at 8400 Normandale Lake
Blvd., Suite 470, Minneapolis, MN 55437 or at such other place as
Payee may designate, the principal sum of Four Million Five Hundred
Thousand Dollars and 00/100 ($4,500,000.00), with interest on the unpaid
principal balance, from the date hereof through and including the dates of
payment, at a fixed interest rate of six and sixty-six hundredths percent (6.66%)
per annum (the “Contract Rate”) at
the times (each, a “Payment Date”)
and in the amounts (each, a “Periodic
Installment”) set forth in Exhibit A hereto.  Such installments have been calculated on the
basis of a 360 day year of twelve 30-day months.  Each payment may, at the option of Payee, be
calculated and applied on an assumption that such payment would be made on its
due date.

All payments shall be
applied: first, to interest due and unpaid hereunder and under the other
Debt Documents; second, to all other amounts due and unpaid hereunder and
under the other Debt Documents, and then to principal due hereunder and under
the other Debt Documents.  The acceptance
by Payee of any payment which is less than payment in full of all amounts due
and owing at such time shall not constitute a waiver of Payee’s right to
receive payment in full at such time or at any prior or subsequent time.  The payment of any Periodic Installment prior
to its due date shall result in a corresponding increase in the portion of the
Periodic Installment credited to the remaining unpaid principal balance.

All
amounts due hereunder and under the other Debt Documents are payable in the
lawful currency of the United States of America.  Maker hereby expressly authorizes Payee to
insert the date value is actually given in the blank space on the face hereof
and on all related documents pertaining hereto.

This Note may be secured by a
security agreement, chattel mortgage, pledge agreement or like instrument (each
of which is hereinafter called a “Security
Agreement”, and collectively with any other document or agreement
related thereto or to this Note, the “Debt
Documents”).

Time
is of the essence hereof.  If Payee does
not receive from Maker payment in full of any Periodic Installment or any other
sum due under this Note or any other Debt Document is not received within ten
(10) days after its due date, Maker agrees to pay a late fee equal to five
percent (5%) on such late Periodic Installment or other sum, but not exceeding
any lawful maximum.  Such late fee will
be immediately due and payable, and is in addition to any other costs, fees and
expenses that Maker may owe as a result of such late payment.  Additionally, if (i) Maker fails to make
payment of any amount due hereunder within ten (10) days after the same becomes
due and payable; or (ii) Maker is in default under, or fails to perform under
any term or condition contained in any Debt Document beyond any applicable
grace or cure period, then the entire principal sum remaining unpaid, together
with all accrued interest thereon and any other sum payable under this Note or
any other Debt Document, at the election of Payee, shall immediately become due
and payable, with interest thereon at the lesser of eighteen percent (18%) per
annum or the highest rate not prohibited by applicable law from the date of
such accelerated maturity until paid (both before and after any judgment).  The application of such 18% interest rate
shall not be interpreted or deemed to extend any cure period set forth in this
Note or any other Debt Document, cure any default or otherwise limit Payee’s
right or remedies hereunder or under any Debt Document.

Maker may prepay in full, but
not in part, all outstanding amounts hereunder before they are due on any
scheduled Payment Date upon at least thirty (30) days’ prior written notice to
Payee.  Payee is authorized and entitled
to apply any amounts paid by Maker as a prepayment of indebtedness to
delinquent interest or other amounts due and owing from Maker to Payee
hereunder and under any other Debt Documents before application of such funds
to principal outstanding hereunder.

If Maker makes a prepayment
of this Note for any reason, Maker shall pay irrevocably and in full to Payee
(i) all outstanding principal amounts, (ii) all accrued interest, (iii) the
Prepayment Fee (as defined below) and (iv) any and all other amounts due
hereunder or under the other Debt Documents. 
Maker specifically acknowledges that, to the fullest extent allowed by
applicable law, it shall be liable for the Prepayment Fee on any acceleration
hereof or under the other Debt Documents. 
In the event of an acceleration hereof or under the other Debt
Documents, the Prepayment Fee shall be determined as if (a) Maker prepaid this
Note in full immediately before such acceleration and (b) the prepayment notice
referred to above was received by Payee thirty (30) days prior to such date.

For
purposes hereof, “Prepayment Fee” shall be an amount equal to (i) Make
Whole Amount plus (ii) an additional sum equal to the following percentage
of remaining principal balance for prepayments occurring in the indicated
period:  Two percent
(2%) (for prepayments occurring prior to the first anniversary of
the date hereof), One percent (1%)
(for prepayments occurring on and after the first anniversary of the date hereof
but prior to the second anniversary of the date hereof) and zero percent (0%)
(for prepayments occurring any time thereafter).  For the purpose hereof, the term “Make Whole
Amount” means (i) the net present value of the remaining scheduled
principal and interest payments (including any balloon or other amount of
principal payable that but for the

  
  
 

 

prepayment
of this Note would be payable on or prior to the scheduled maturity date
hereof), discounted to the prepayment date at a per annum interest rate equal
to the then Reinvestment Rate (as defined below) minus (ii) the principal
balance outstanding as of the prepayment date (immediately prior to any such
prepayment); provided, that the Make Whole Amount shall be deemed zero if the
calculation results in a negative number. 
For purposes hereof, the term “Reinvestment Rate” means the per annum
interest rate that is equal to the sum of (a) Two point one five percent
(2.15%) plus (b) the stated yield to maturity of United States Treasury
Notes having a life equal to the remaining term of this Note as stated in the
most current Federal Reserve Statistical Release H.15 (519) on the day Payee
receives the prepayment notice.  If no
maturity exactly corresponds to the remaining term of this Note, the Treasury
Note life to be adopted from Federal Reserve Statistical Release H.15 (519)
shall correspond to a full number of years period, excluding partial years of
such remaining term.

It
is the intention of the parties hereto to comply with the applicable usury
laws; accordingly, it is agreed that, notwithstanding any provision to the
contrary in this Note or any other Debt Document, in no event shall this Note
or any other Debt Document require the payment or permit the collection of
interest in excess of the maximum amount permitted by applicable law.  If any such excess interest is contracted
for, charged or received under this Note or any other Debt Document, or if all
of the principal balance shall be prepaid, so that under any of such
circumstances the amount of interest contracted for, charged or received under
this Note or any other Debt Document on the principal balance shall exceed the
maximum amount of interest permitted by applicable law, then in such event: (a)
the provisions of this paragraph shall govern and control, (b) neither Maker
nor any other person or entity now or hereafter liable for the payment hereof
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the maximum amount of interest permitted by applicable law, (c)
any such excess which may have been collected shall be either applied as a
credit against the then unpaid principal balance or refunded to Maker, at the
option of Payee, and (d) the effective rate of interest shall be automatically
reduced to the maximum lawful contract rate allowed under applicable law as now
or hereafter construed by the courts having jurisdiction thereof.  It is further agreed that without limitation
of the foregoing, all calculations of the rate of interest contracted for,
charged or received under this Note or any Debt Document which are made for the
purpose of determining whether such rate exceeds the maximum lawful contract
rate, shall be made, to the extent permitted by applicable law, by amortizing,
prorating, allocating and spreading in equal parts during the period of the
full stated term of the indebtedness evidenced hereby, all interest at any time
contracted for, charged or received from Maker or otherwise by Payee in
connection with such indebtedness; provided, however, that if any applicable
state law is amended or the law of the United States of America preempts any
applicable state law, so that it becomes lawful for Payee to receive a greater
interest per annum rate than is presently allowed, Maker agrees that, on the effective
date of such amendment or preemption, as the case may be, the lawful maximum
hereunder shall be increased to the maximum interest per annum rate allowed by
the amended state law or the law of the United States of America.

Maker
hereby consents to any and all extensions of time, renewals, waivers or
modifications of, and all substitutions or releases of, security or of any
party primarily or secondarily liable on this Note or any other Debt Document
or any term and provision of either, which may be made, granted or consented to
by Payee, and agrees that suit may be brought and maintained against Maker
and/or any and all sureties, endorsers, guarantors or any others who may at any
time become liable for payments and performance under this Note and any other
Debt Documents (each such person, other than Maker, an “Obligor”), at the election of Payee without joinder of
any other as a party thereto, and that Payee shall not be required first to
foreclose, proceed against, or exhaust any security hereof in order to enforce
payment of this Note.  Maker hereby
waives presentment, demand for payment, notice of nonpayment, protest, notice
of protest, notice of dishonor, and all other notices in connection herewith,
as well as filing of suit (if permitted by law) and diligence in collecting
this Note or enforcing any of the security hereof, and agrees to pay (if
permitted by law) all expenses incurred in collection, including Payee’s actual
and reasonable attorneys’ fees.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF HAWAII.

MAKER IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE STATE AND FEDERAL COURTS LOCATED IN THE STATE OF HAWAII TO HEAR AND
DETERMINE ANY SUIT, ACTION OR PROCEEDING AND TO SETTLE ANY DISPUTES, WHICH MAY
ARISE OUT OF OR IN CONNECTION HEREWITH AND WITH THE DEBT DOCUMENTS
(COLLECTIVELY, THE “PROCEEDINGS”), AND MAKER FURTHER IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE TO REMOVE ANY SUCH PROCEEDINGS FROM ANY SUCH COURT (EVEN IF
REMOVAL IS SOUGHT TO ANOTHER OF THE ABOVE-NAMED COURTS).  MAKER IRREVOCABLY WAIVES ANY OBJECTION WHICH
IT MIGHT NOW OR HEREAFTER HAVE TO THE ABOVE-NAMED COURTS BEING NOMINATED AS THE
EXCLUSIVE FORUM TO HEAR AND DETERMINE ANY SUCH PROCEEDINGS AND AGREES NOT TO
CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF THE ABOVE-NAMED
COURTS FOR ANY REASON WHATSOEVER, THAT IT OR ITS PROPERTY IS IMMUNE FROM LEGAL
PROCESS FOR ANY REASON WHATSOEVER, THAT ANY SUCH COURT IS NOT A CONVENIENT OR
APPROPRIATE FORUM IN EACH CASE WHETHER ON THE GROUNDS OF VENUE OR FORUM
NON-CONVENIENS OR OTHERWISE.  MAKER
ACKNOWLEDGES THAT BRINGING ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY COURT
OTHER THAN THE COURTS SET FORTH ABOVE WILL CAUSE IRREPARABLE HARM TO PAYEE
WHICH COULD NOT ADEQUATELY BE COMPENSATED BY MONETARY DAMAGES, AND, AS SUCH,
MAKER AGREES THAT, IN ADDITION TO ANY OF THE REMEDIES TO WHICH PAYEE MAY BE
ENTITLED AT LAW OR IN EQUITY, PAYEE WILL BE ENTITLED TO AN INJUNCTION OR
INJUNCTIONS (WITHOUT THE POSTING OF ANY BOND AND WITHOUT PROOF OF ACTUAL
DAMAGES) TO ENJOIN THE PROSECUTION OF ANY SUCH PROCEEDINGS IN ANY OTHER
COURT.  Notwithstanding the foregoing, each of Maker
and Payee shall have the right to apply to a court of competent jurisdiction in
the United States of America or abroad for equitable relief as is necessary to
preserve, protect and enforce its respective rights under this Note and any
other Debt

  
  
 

 

Document,
including, but not limited to orders of attachment or injunction necessary to
maintain the status quo pending litigation or to enforce judgments against
Maker, any Obligor or the collateral pledged to Payee pursuant to any Debt
Document or to gain possession of such collateral.  TO THE EXTENT  PERMITTED BY LAW MAKER HEREBY UNCONDITIONALLY
WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF, DIRECTLY OR INDIRECTLY, THIS NOTE, ANY DEBT DOCUMENTS, ANY
DEALINGS BETWEEN MAKER AND PAYEE RELATING TO THE SUBJECT MATTER OF THIS
TRANSACTION OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING
ESTABLISHED BETWEEN MAKER AND PAYEE.  THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT (INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY
CLAIMS.)  THIS WAIVER IS IRREVOCABLE
MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THE WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS NOTE, ANY DEBT DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS
RELATING TO THIS TRANSACTION OR ANY RELATED TRANSACTION.  IN THE EVENT OF LITIGATION, THIS NOTE MAY BE
FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

This Note and the other Debt
Documents constitute the entire agreement of Maker and Payee with respect to
the subject matter hereof and supersede all prior understandings, agreements
and representations, express or implied.

No
variation or modification of this Note, or any waiver of any of its provisions
or conditions, shall be valid unless in writing and signed by an authorized
representative of Maker and Payee.  Any
such waiver, consent, modification or change shall be effective only in the
specific instance and for the specific purpose given.

Payment Authorization

Payee is hereby directed and authorized by Maker to
advance and/or apply the proceeds
of the loan as evidenced by this Note to the following parties in the
stipulated amounts as set forth below:

	
  Company Name

  	
   

  	
  Address

  	
   

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Maker

  	
   

  	
  (see below)

  	
   

  	
   

  	
  $

  	
  4,500,000.00

  	
   

  
								

 

Any
provision in this Note or any of the other Debt Documents which is in conflict
with any statute, law or applicable rule shall be deemed omitted, modified or
altered to conform thereto.

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INTENTIONALLY LEFT BLANK; EXECUTION PAGE FOLLOWS]

  
  
 

 

 

	
  Maui Pineapple Company, Ltd.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By: 

  	
  /S/ FRED W. RICKERT

  	
   

  	
   

  	
  By: 

  	
  /S/ ADELE H.
  SUMIDA

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Fred W. Rickert

  	
   

  	
   

  	
  Name: 

  	
  Adele H. Sumida

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Vice President/Treasurer

  	
   

  	
   

  	
  Title:

  	
  Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Federal Tax ID
  #:

  	
  990173364

  	
   

  	
   

  	
   

  	
   

  	
   

  
													

 

	
  Address:

  	
  120 Kane Street, Kahului, Maui County, HI 96733Exhibit 10.2

 

GUARANTY
AGREEMENT

Dated as of
September 29, 2006

For good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and to induce GE Capital Public Finance,
Inc., a Delaware corporation (herein,
with its participants, successors and assigns, “Lender”), at its option, to
provide financing to or for the account of Maui Pineapple Company,
Ltd. (“Borrower”) or to engage in any other transactions with
Borrower, the undersigned hereby: (a) absolutely and unconditionally
guarantees to Lender the full and prompt payment when due, whether at maturity
or earlier by reason of acceleration or otherwise in accordance with the terms
of the Master Security Agreement (as defined below) and the Promissory Note (as
defined below), of any and all present and future debts, liabilities and
obligations owed by Borrower to Lender evidenced by or arising out of the
Master Security Agreement and Collateral Schedule No. 1 thereto, both dated as
of September 29, 2006 (the “Master Security Agreement”) between Lender and
Borrower and the Promissory Note dated September 29, 2006 executed by Borrower
and payable to the order of Lender, and any and all extensions, renewals,
modifications, supplements or amendments thereto or thereof and any related
agreements (the “Indebtedness”), and (b) absolutely and unconditionally
guarantees to Lender the full and timely performance by Borrower of all of its
obligations under the Master Security Agreement and the Promissory Note.

1.             No act or thing need occur to
establish the liability of the undersigned hereunder, and no act or thing,
except full payment and discharge of all Indebtedness, shall in any way
exonerate the undersigned hereunder or modify, reduce, limit or release the
liability of the undersigned hereunder. 
This is an absolute, unconditional and continuing guaranty of payment of
the Indebtedness.  The dissolution or
adjudication of bankruptcy of the undersigned shall not revoke this Guaranty
Agreement (this “Agreement”).

2.             The
undersigned represents and warrants to Lender that (a) the undersigned has
a direct and substantial economic interest in Borrower and expects to derive
substantial benefits therefrom and from any loans, credit transactions,
financial accommodations, discounts, purchases of property and other
transactions and events resulting in the creation of Indebtedness guaranteed
hereby (this Agreement shall be effective and enforceable by Lender without
regard to the receipt, nature or value of any such benefits); (b) the undersigned executed this
Agreement without any intent to hinder, delay, or defraud any current or future
creditor of the undersigned; (c) the undersigned is not insolvent and will
not become insolvent as a result of the execution of this Agreement;
(d) the undersigned is not engaged and is not about to engage in any
business or transaction for which any property remaining with the undersigned
has an unreasonably small capital or for which the remaining assets of the
undersigned were unreasonably small in relation to the business of the
undersigned or the transaction contemplated by this Agreement; (e) the
undersigned does not intend to incur, and does not believe or reasonably should
not believe that the undersigned will incur, debts beyond the undersigned’s
ability to pay such debts as they become due; (f) the undersigned
is a corporation duly organized, validly existing and in good standing under
the laws of the State of Hawaii (the “State”), has power to enter into this

 

Agreement and by proper
corporate action has duly authorized the execution and delivery of this
Agreement; (g) the undersigned is in good standing and is duly licensed or
qualified to transact business in the State and, except in each case to the
extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect (as defined below), in all jurisdictions where the
character of the property owned or leased or the nature of the business
transacted by it makes such licensing or qualification necessary; (h) the
undersigned has been fully authorized to execute and deliver this Agreement
under the terms and provisions of the resolutions of its board of directors, or
by other appropriate official approval, and further represents, covenants and
warrants that all requirements have been met, and procedures have occurred in
order to ensure the enforceability of this Agreement and this Agreement has
been duly authorized, executed and delivered; (i) the officer of the
undersigned executing this Agreement and any related documents has been duly
authorized to execute and deliver this Agreement and such related documents
under the terms and provisions of a resolution of the undersigned’s directors;
(j) this Agreement constitutes a valid and legally binding obligation of
the undersigned enforceable against the undersigned in accordance with its
respective terms, except to the extent limited by bankruptcy, reorganization or
other laws of general application relating to or affecting the rights and
remedies of creditors and by general equitable principles, regardless of
whether such enforceability is considered in a proceeding in equity or at law;
and (k) the execution and delivery of this Agreement, the consummation of
the transactions contemplated hereby and the fulfillment of the terms and conditions
hereof do not and will not violate any law, rule, regulation or order, conflict
with or result in a breach of any of the terms or conditions of the articles of
incorporation or bylaws of the undersigned or of any material agreement or
instrument to which the undersigned is now a party and does not and will not
constitute a default under any of the foregoing or result in the creation or
imposition of any liens, charges or encumbrances of any nature upon any of the
property or assets of the undersigned contrary to the terms of any instrument
or agreement to which the undersigned is a party or by which it is bound.  “Material Adverse Effect” means a material
adverse effect or change on (a) the business, assets, operations, properties or
condition (financial or otherwise) of the undersigned, (b) the ability of
the undersigned to perform or pay its obligations hereunder or on any other
material obligation in accordance with the terms thereof, or (c) the validity
or enforceability of this Agreement or the rights and remedies available to
Lender hereunder.

3.             If the undersigned shall be or
become bankrupt or insolvent (however defined), then Lender shall have the
right to declare immediately due and payable, and the undersigned shall
forthwith pay to Lender, the full amount of all Indebtedness whether due and
payable or unmatured. If the undersigned voluntarily commences or there is
commenced involuntarily against the undersigned a case under the United States
Bankruptcy Code, the full amount of all Indebtedness, whether due and payable
or unmatured, shall be immediately due and payable without demand or notice
thereof.

4.             The undersigned shall not exercise
or enforce any right of contribution, reimbursement, recourse or subrogation
available to the undersigned as to any Indebtedness, or against any person
liable therefor, or as to any collateral security therefor.

 2
 

 

5.             The undersigned shall pay or
reimburse Lender for all costs and expenses (including reasonable attorneys’
fees and legal expenses) incurred by Lender in connection with the protection,
defense or enforcement of this Agreement in any litigation or bankruptcy or
insolvency proceedings.

6.             Lender shall not be obligated by
reason of its acceptance of this Agreement to engage in any transactions with
or for Borrower.  Whether or not any
existing relationship between the undersigned and Borrower has been changed or
ended, Lender may enter into transactions resulting in the creation or
continuance of Indebtedness and may otherwise agree, consent to, or suffer the
creation or continuance of any Indebtedness, without any consent or approval by
the undersigned and without any prior or subsequent notice to the
undersigned.  The liability of the
undersigned shall not be affected or impaired by any of the following acts or
things (which Lender is expressly authorized to do, omit or suffer from time to
time, both before and after revocation of this Agreement, without consent or
approval by or notice to the undersigned): (a) any acceptance of
collateral security, guarantors, accommodation parties or sureties for any or
all Indebtedness; (b) one or more extensions or renewals of Indebtedness
(whether or not for longer than the original period) or any modification of the
interest rates, maturities or other contractual terms applicable to any
Indebtedness; (c) any waiver or indulgence granted to Borrower, any delay
or lack of diligence in the enforcement of Indebtedness, or any failure to
institute proceedings, file a claim, give any required notices or otherwise
protect any Indebtedness; (d) any full or partial release of, compromise
or settlement with, or agreement not to sue, Borrower or any other guarantor or
other person liable in respect of any Indebtedness; (e) any release,
surrender, cancellation or other discharge of any evidence of Indebtedness or
the acceptance of any instrument in renewal or substitution therefor;
(f) any failure to obtain collateral security (including rights of setoff)
for Indebtedness, or to see to the proper or sufficient creation and perfection
thereof, or to establish the priority thereof, or to preserve, protect, insure,
care for, exercise or enforce any collateral security; or any modification,
alteration, substitution, exchange, surrender, cancellation, termination,
release or other change, impairment, limitation, loss or discharge of any
collateral security; (g) any collection, sale, lease or disposition of, or
any other foreclosure or enforcement of or realization on, any collateral
security; (h) any assignment, pledge or other transfer of any Indebtedness
or any evidence thereof; (i) any manner, order or method of application of
any payments or credits upon Indebtedness; (j) any election by Lender
under Section 1111(b) of the United States Bankruptcy Code.  The undersigned waives any and all defenses
and discharges available to a surety, guarantor, or accommodation co-obligor.

7.             The undersigned waives any and all
defenses, claims, setoffs, and discharges of Borrower, or any other obligor,
pertaining to Indebtedness, except the defense of discharge by payment in
full.  Without limiting the generality of
the foregoing, the undersigned shall not assert, plead or enforce against
Lender any defense of waiver, release, discharge in bankruptcy, statute of limitations,
res judicata, statute of frauds, anti-deficiency statute, fraud, incapacity,
minority, usury, illegality or unenforceability which may be available to
Borrower or any other person liable in respect of any Indebtedness, or any
setoff available against Lender to Borrower or any other such person, whether
or not on account of a related transaction. 
The undersigned expressly agrees that the undersigned shall be and
remain liable for any deficiency remaining

 3
 

 

after foreclosure of any mortgage or security interest securing
Indebtedness, whether or not the liability of Borrower or any other obligor for
such deficiency is discharged pursuant to statute or judicial decision.  The liability of the undersigned shall not be
affected or impaired by any voluntary or involuntary liquidation, dissolution,
sale or other disposition of all or substantially all the assets, marshalling
of assets and liabilities, receivership, insolvency, bankruptcy, assignment for
the benefit of creditors, reorganization, arrangement, composition or
readjustment of, or other similar event or proceeding affecting Borrower or any
of their respective assets.  The
undersigned shall not assert, plead or enforce against Lender any claim,
defense or setoff available to the undersigned against Borrower.

 

8.             The undersigned waives presentment,
demand for payment, notice of dishonor or nonpayment, and protest of any
instrument evidencing Indebtedness. 
Lender shall not be required first to resort for payment of the
Indebtedness to Borrower or other persons, or their properties, or first to
enforce, realize upon or exhaust any collateral security for Indebtedness,
before enforcing this Agreement.

9.             If any payment applied by Lender to
Indebtedness is thereafter set aside, recovered, rescinded or required to be
returned for any reason (including, without limitation, the bankruptcy,
insolvency or reorganization of Borrower or any other obligor), the
Indebtedness to which such payment was applied shall for the purpose of this
Agreement be deemed to have continued in existence, notwithstanding such
application, and this Agreement shall be enforceable as to such Indebtedness as
fully as if such application had never been made.

10.           The liability of the undersigned
under this Agreement is in addition to and shall be cumulative with all other
liabilities of the undersigned to Lender as guarantor, surety, endorser,
accommodation co-obligor or otherwise of any Indebtedness or obligation of
Borrower, without any limitation as to amount, unless the instrument or
agreement evidencing or creating such other liability specifically provides to
the contrary.

11.           The undersigned will deliver, or
cause to be delivered, to Lender each of the following, which shall be in form
and detail acceptable to Lender:

(a)           as soon as available, and in any
event within 120 days after the end of each fiscal year of the
undersigned, audited consolidated financial statements of the undersigned with
the unqualified opinion of independent certified public accountants selected by
the undersigned and reasonably acceptable to Lender, which annual consolidated
financial statements shall include the consolidated balance sheet of the
undersigned as at the end of such fiscal year and the related consolidated
statements of income, retained earnings and cash flows of the undersigned for the
fiscal year then ended, all in reasonable detail and prepared in accordance
with generally accepted accounting principles under the United States as
established by the Financial Accounting Standards Board applied on a consistent
basis (“GAAP”), together with a certificate of the chief financial officer
of the undersigned in the form of Exhibit A hereto stating that such
financial statements have been prepared in accordance with GAAP and whether or
not such officer has knowledge of the occurrence of any default or event of
default under the Master Security Agreement and, if so, stating in

 4
 

 

reasonable detail the
facts with respect thereto and all relevant facts in reasonable detail to
evidence, and the computations as to, whether or not the undersigned is in compliance
with the requirements set forth in Sections 13 through 15 hereof; and

(b)           as soon as available and in any event
within 90 days after the end of each fiscal quarter of the undersigned, an
unaudited/internal consolidated balance sheet and statements of income and
retained earnings of the undersigned as at the end of and for such quarter and
for the year to date period then ended, in reasonable detail and stating in
comparative form the figures for the corresponding date and periods in the
previous year, all prepared in accordance with GAAP and certified by the chief
financial officer of the undersigned, subject to year-end audit
adjustments; and accompanied by a certificate of that officer in the form of
Exhibit A hereto stating (i) that such financial statements have been
prepared in accordance with GAAP, (ii) whether or not such officer has
knowledge of the occurrence of any default or event of default under the Master
Security Agreement not theretofore reported and remedied and, if so, stating in
reasonable detail the facts with respect thereto and (iii) all relevant facts
in reasonable detail to evidence, and the computations as to, whether or not
the undersigned is in compliance with the requirements set forth in Sections 13
through 15 hereof.

12.           For the purposes of Sections 13
through 15, the following capitalized terms shall have the following meanings:

“Consolidated Cash Flow
Available for Debt Service” means, with respect to the applicable
period of determination, for the undersigned and its Subsidiaries on a
consolidated basis, the sum of income, interest expense, depreciation,
amortization and other non-cash charges.

“Consolidated
Debt Service” means, with respect to the applicable period of
determination, for the undersigned and its Subsidiaries on a consolidated basis
the aggregate of (a) interest expense, (b) current maturities of long term
debt during the period of determination, (c) the current portion of capital
leases that are due during the period of determination and (d) distributions
and dividends to stockholders.

“Consolidated
Funded Debt” shall mean, as at any date of determination, for the
undersigned and its Subsidiaries on a consolidated basis, all indebtedness for
borrowed money evidenced notes, bonds, debentures, or similar evidences of
indebtedness, and which by its term matures more than one year from, or is
directly or indirectly renewable or extendible at such person’s option under a
revolving credit or similar agreement obligating the lender or lenders
thereunder to extend credit over a period of more than one year from the date
of creation thereof, and specifically including (i) capital lease
obligations, (ii) current maturities of long-term debt, and
(iii) revolving credit and short-term debt extendible beyond one year at
the option of the debtor.

“Consolidated
Net Income” shall mean, for any period, on a consolidated basis, the
net income, if any, of the undersigned and its Subsidiaries, determined in
accordance with GAAP.

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“Consolidated
Net Worth” shall mean, as at any date of determination, on a
consolidated basis, the gross book value of the assets of the undersigned,
minus the sum of (a) all reserves applicable thereto, and (b) all
liabilities of the undersigned (including subordinated liabilities).

“Consolidated
Total Capitalization” shall mean, as at any date of determination,
the sum of (a) Consolidated Funded Debt, plus (b) Consolidated Net
Worth.

“Fixed Charge Coverage
Ratio” means the ratio of (a) the undersigned’s Consolidated Cash
Flow Available for Debt Service to (b) the undersigned’s Consolidated Debt
Service.

“Subsidiaries”
means any corporation, partnership, limited liability company, joint venture or
any other legal entity that in accordance with GAAP would be properly
consolidated on the books of the undersigned.

13.           The undersigned shall maintain at all
times its Consolidated Net Worth at not less than $85,000,000.

14.           The
undersigned shall not permit Consolidated Funded Debt to exceed 55% of
Consolidated Total Capitalization.

15.           Borrower
shall have a Fixed Charge Coverage Ratio of at least 1.50 to 1.00 at the end of
each fiscal year of the undersigned.

16.           The
undersigned will not sell, lease, assign, transfer or otherwise dispose of all
or substantially all of its assets (whether in one transaction or in a series
of transactions) except to Borrower.

17.           (a)  The undersigned will not consolidate with or
merge into any person, unless such merger or consolidation is only between
Borrower and the undersigned.

(b)           The
undersigned will not permit any other person to merge into it, or acquire (in a
transaction analogous in purpose or effect to a consolidation or merger) all or
substantially all of the assets of any other person, unless (i) immediately
upon the consummation of such merger, consolidation or acquisition, the
undersigned shall be in compliance with the financial covenants set forth in
Sections 12 through 14 hereof and (ii) no default or event of default hereunder
or under the Master Security Agreement would result from such merger or
consolidation.

18.           This
Agreement shall be effective upon delivery to Lender, without further act,
condition or acceptance by Lender, shall be binding upon the undersigned and
the successors and assigns of the undersigned and shall inure to the benefit of
Lender and its participants, successors and assigns.  Any invalidity or unenforceability of any
provision or application of this Agreement shall not affect other lawful
provisions and application hereof, and to this end the provisions of this
Agreement are declared to be severable. 
This Agreement may not be waived, modified, amended, terminated,
released or otherwise changed except by a writing signed by the

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undersigned and Lender.  This
Agreement shall be governed by the laws of the State of Hawaii.  The undersigned waives notice of Lender’s
acceptance hereof and, to the extent permitted by law, waives the right to
trial by jury in any action based on or pertaining to this Agreement.

 

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IN WITNESS WHEREOF,
this Guaranty Agreement has been executed by the undersigned as of the day and
year first above written.

 

	
  

  	
  MAUI LAND & PINEAPPLE COMPANY,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /S/ FRED W. RICKERT

  	
   

  
	
   

  	
  Print:

  	
   

  	
  Fred W. Rickert

  	
   

  
	
   

  	
  Its:

  	
   

  	
  Vice President/Treasurer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /S/ ADELE H. SUMIDA

  	
   

  
	
   

  	
  Print:

  	
   

  	
  Adele H. Sumida

  	
   

  
	
   

  	
  Its:

  	
   

  	
  Controller & Secretary

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