Document:

Unassociated Document

EXHIBIT 10.2

 

REVOLVING CREDIT NOTE

 

	 
$35,000,000

	Date:  May 29, 2012

 

This Revolving Credit Note (this “Note”) is executed and delivered under and pursuant to the terms of that certain Revolving Credit and Security Agreement dated as of May 29, 2012 (as amended, amended and restated, supplemented, extended, joined and/or otherwise modified from time to time, the “Credit Agreement”) by and among ENGLOBAL CORPORATION, a corporation organized under the laws of the State of Nevada (“Holdings”), ENGLOBAL U.S., INC., a corporation organized under the laws of the State of Texas (“ENGlobal US”), ENGLOBAL INTERNATIONAL, INC., a corporation organized under the BVI Business Companies Act of 2004 (“ENGlobal International”), ENGLOBAL GOVERNMENT SERVICES, INC., a corporation organized under the laws of the State of Texas (“ENGlobal Government”; and together with Holdings, ENGlobal US, and ENGlobal International, individually, each a “Borrower” and jointly and severally, “Borrowers”), the financial institutions which are now or which hereafter become a party thereto (collectively, the “Lenders” and individually, each a “Lender”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for itself and as agent for the other Lenders (PNC, together with its successors and assigns in such capacity, “Agent”).  Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Credit Agreement.

 

FOR VALUE RECEIVED, Borrowers hereby jointly and severally promise to pay to the order of PNC, at the office of Agent located at Two Tower Center Boulevard, East Brunswick, New Jersey 08816, or at such other place as Agent may from time to time designate to the Borrowing Agent in writing:

 

(i)           the principal sum of THIRTY FIVE MILLION AND NO/100 DOLLARS ($35,000,000) or, if different from such amount, the unpaid principal balance of PNC’s Revolving Advance Commitment Percentage as may be due and owing under the Credit Agreement, payable in accordance with the provisions of the Credit Agreement, and subject to acceleration upon the occurrence and continuance of an Event of Default under the Credit Agreement or earlier termination of the Credit Agreement pursuant to the terms thereof; and

 

(ii)           interest on the principal amount of this Note from time to time outstanding until such principal amount is paid in full at the applicable Revolving Interest Rate in accordance with the provisions of the Credit Agreement.  In no event, however, shall interest exceed the maximum interest rate permitted by law.  Upon and after the occurrence of an Event of Default, and during the continuation thereof, interest shall be payable at the Default Rate.

 

This Note is a Revolving Credit Note referred to in the Credit Agreement and is secured, inter alia, by the liens granted pursuant to the Credit Agreement and the Other Documents, is entitled to the benefits of the Credit Agreement and the Other Documents and is subject to all of the agreements, terms and conditions therein contained.

 

This Note is subject to mandatory prepayment and may be voluntarily prepaid, in whole or in part, on the terms and conditions set forth in the Credit Agreement.

 

  

  

  

If an Event of Default under Section 10.7 of the Credit Agreement shall occur, then this Note shall immediately, in accordance with the Credit Agreement, become due and payable, without notice, together with reasonable and actual attorneys’ fees if the collection hereof is placed in the hands of an attorney to obtain or enforce payment hereof.  If any other Event of Default shall occur under the Credit Agreement or any of the Other Documents, which is not cured within any applicable grace period, then this Note may, or upon the election of Required Lenders, shall, as provided in the Credit Agreement, be declared to be immediately due and payable, without notice, together with reasonable and actual attorneys’ fees, if the collection hereof is placed in the hands of an attorney to obtain or enforce payment hereof.

 

This Note shall be construed and enforced in accordance with the laws of the State of Texas.

 

Each Borrower expressly waives any presentment, demand, protest, notice of protest, notice of intent to accelerate, notice of acceleration, or notice of any kind except as expressly provided in the Credit Agreement.

 

[Remainder of page intentionally left blank]

 

 

  

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

 

	 	 
BORROWERS:

	 	 	 
	 	 
ENGLOBAL CORPORATION

	 	 	 
	 	By:	 
/s/ Edward L. Pagano

	 	Name:	 
Edward L. Pagano

	 	Title:	 
President and Chief Executive Officer

	 	 	 
	 	 	 
	 	 
ENGLOBAL U.S., INC.

	 	 	 
	 	By:	 
/s/ Edward L. Pagano

	 	Name:	 
Edward L. Pagano

	 	Title:	 
President and Chief Executive Officer

	 	 	 
	 	 	 
	 	 
ENGLOBAL INTERNATIONAL, INC.

	 	 	 
	 	By:	 
/s/ Edward L. Pagano

	 	Name:	 
Edward L. Pagano

	 	Title:	 
President and Chief Executive Officer

	 	 	 
	 	 	 
	 	 
ENGLOBAL GOVERNMENT SERVICES, INC.

	 	 	 
	 	By:	 
/s/ Edward L. Pagano

	 	Name:	 
Edward L. Pagano

	 	Title:	 
President and Chief Executive Officer

 

 

 

 

[Signature Page to Revolving Credit Note]Unassociated Document

EXHIBIT 10.3

 

EXECUTION COPY

 

GUARANTY

FOR VALUE RECEIVED, and in consideration of any loan or other financial accommodation heretofore or hereafter at any time made or granted to ENGLOBAL CORPORATION, a corporation organized under the laws of the State of Nevada (“Holdings”), ENGLOBAL U.S., INC., a corporation organized under the laws of the State of Texas (“ENGlobal US”), ENGLOBAL INTERNATIONAL, INC., a corporation organized under the BVI Business Companies Act of 2004 (“ENGlobal International”), ENGLOBAL GOVERNMENT SERVICES, INC., a corporation organized under the laws of the State of Texas (“ENGlobal Government”; and together with Holdings, ENGlobal US, and ENGlobal International, individually, each a “Borrower” and jointly and severally, “Borrowers”), the financial institutions which are now or which hereafter become a party thereto (collectively, the “Lenders” and individually, each a “Lender”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for itself and as agent for the other Lenders (PNC, together with its successors and assigns in such capacity, “Agent”), the undersigned (the “Guarantor”) hereby agrees as of May 29, 2012 as follows:

1.           Guaranty of Obligations.  Guarantor unconditionally, absolutely, irrevocably, jointly and severally guarantees the full and prompt payment and performance when due, whether at stated maturity, by required prepayment, declaration, demand, acceleration or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C., 88 362(a)), and at all times thereafter, of all obligations of each Borrower to Agent for the benefit of the Lenders, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, or now or hereafter existing or due or to become due, including, without limitation, all Obligations under or in connection with (and as defined in) that certain Revolving Credit and Security Agreement, dated on or about the date hereof, by and among the Borrowers, each of the financial institutions from time to time a party thereto (individually, each a “Lender” and collectively, the “Lenders” and Agent (as amended, amended and restated, supplemented, extended, joined and/or otherwise modified from time to time, the “Credit Agreement”) and each of the documents, instruments and agreements executed and delivered in connection therewith, as each may be modified, increased, amended, supplemented or replaced from time to time (all such obligations are herein referred to, collectively, as the “Liabilities”, and all documents evidencing or securing any of the Liabilities, including without limitation, the Credit Agreement and Other Documents, are herein referred to, collectively, as the “Loan Documents”).  Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Credit Agreement.  This Guaranty (this “Guaranty”) is a guaranty of payment and performance when due and not of collection.

In the event of any default by any Borrower in making payment when due (whether at stated maturity, by required prepayment, declaration, demand, acceleration, or otherwise) of, or default by any Borrower in performance of any of the Liabilities, including but not limited to any Event of Default under the Credit Agreement, Guarantor agrees on demand by Agent to pay and perform all of the Liabilities as are then or thereafter become due and owing or are to be performed under the terms of the Loan Documents.  Guarantor further agrees to pay all expenses (including, without limitation, reasonable attorneys’ fees and expenses) paid or incurred by 

  

  

  

Agent in endeavoring to collect the Liabilities, or any part thereof, and in enforcing this Guaranty (collectively, “Enforcement Costs”).

 

2.           Continuing Nature of Guaranty and Liabilities; Termination.  Except pursuant to the conditions of Paragraph 4 below, this Guaranty shall be continuing and shall not be discharged, impaired or affected by:

a.           the insolvency of Guarantor or the payment in full of all of the Liabilities at any time or from time to time prior to termination of the Credit Agreement and all other Loan Documents and the full and final release and discharge of all obligations of all parties thereunder;

b.           the power or authority or lack thereof of any Borrower to incur the Liabilities;

c.           the validity or invalidity of any of the Loan Documents or the documents securing the same;

d.           the existence or non-existence of any Borrower as a legal entity;

e.           any transfer by any Borrower of all or any part of any Collateral in which Agent, for the benefit of the Lenders, has been granted a lien or security interest pursuant to the Loan Documents;

f.           any statute of limitations affecting the liability of Guarantor under this Guaranty or the Loan Documents or the ability of Agent to enforce this Guaranty or any provision of the Loan Documents; or

g.           any right of offset, counterclaim or defense of Guarantor whatsoever (other than payment in part or in full and performance in full of all of the Liabilities after any termination of the Credit Agreement in accordance with the terms of the Loan Documents), including, without limitation, those which have been waived by Guarantor pursuant to Paragraphs 6 and 8 hereof.

3.           Insolvency of any Borrower or Guarantor.  Without limiting the generality of any other provision hereof, Guarantor agrees that, in the event of the dissolution or insolvency of any Borrower or Guarantor or the inability of any Borrower or Guarantor to pay its respective debts as they mature, or an assignment by any Borrower or Guarantor for the benefit of creditors, or the institution of any proceeding by or against any Borrower or Guarantor alleging that such Borrower or Guarantor is insolvent or unable to pay its respective debts as they mature and in the case of any proceeding against any Borrower or Guarantor, such proceeding is not dismissed within sixty (60) days, Guarantor will pay to Agent forthwith the full amount which would be payable hereunder by Guarantor if all of the Liabilities were then due and payable, whether or not such event occurs at a time when any of the Liabilities are otherwise due and payable.

  

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4.           Payment of the Liabilities.  Any amounts received by Agent from whatever source on account of the Liabilities may be applied by Agent toward the payment of such of the Liabilities, and in such order of application, as provided in the Credit Agreement, and notwithstanding any payments made by or for the account of Guarantor pursuant to this Guaranty.

Guarantor agrees that, if at any time all or any part of any payment theretofore applied by Agent to any of the Liabilities is or must be rescinded or returned by Agent for any reason whatsoever (including, without limitation, the insolvency, bankruptcy or reorganization of any Borrower), such Liabilities shall, for the purposes of this Guaranty and to the extent that such payment is or must be rescinded or returned, be deemed to have continued in existence notwithstanding such application by Agent, and this Guaranty shall continue to be effective or be reinstated, as the case may be, as to such Liabilities, all as though such application by Agent had not been made.

5.           Permitted Actions of Agent. Agent may from time to time, in its sole discretion and without notice to Guarantor, take any or all of the following actions:

a.           retain or obtain a security interest in any assets of any Borrower or any third party to secure any of the Liabilities or any obligations of Guarantor hereunder;

b.           retain or obtain the primary or secondary obligation of any obligor or obligors, in addition to Guarantor, with respect to any of the Liabilities;

c.           extend or renew for one or more periods (whether or not longer than the original period), alter, exchange or increase any of the Liabilities;

d.           waive, ignore or forbear from taking action or otherwise exercising any of its default rights or remedies with respect to any default by any Borrower under the Loan Documents;

e.           release, waive or compromise any obligation of Guarantor hereunder or any obligation of any nature of any other obligor primarily or secondarily obligated with respect to any of the Liabilities, without notice to any other obligor or any other guarantor;

f.           release its security interest in, or surrender, release or permit any substitution or exchange for, all or any part of any collateral, including but not limited to the Collateral, now or hereafter securing any of the Liabilities or any obligation hereunder, or extend or renew for one or more periods (whether or not longer than the original period) or release, waive, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such property;

g.           demand payment or performance of any of the Liabilities which are due and owing from Guarantor at any time or from time to time, whether or not Agent shall have exercised any of its rights or remedies with respect to any property securing any of the Liabilities 

  

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or any obligation hereunder, or proceeded against any other obligor primarily or secondarily liable for payment or performance of any of the Liabilities; and

 

h.           exercise or refrain from exercising any rights under the Loan Documents against any Borrower or other Person or otherwise refrain from acting.

6.           Specific Waivers.  Without limiting the generality of any other provision of this Guaranty, Guarantor hereby expressly waives (except to the extent provided otherwise in any Loan Document):

a.           notice of the acceptance by Agent of this Guaranty;

b.           notice of the existence, creation, payment, nonpayment, performance or nonperformance of all or any of the Liabilities;

c.           presentment, demand, notice of dishonor, protest, notice of protest, notice of intent to accelerate, notice of acceleration, and all other notices whatsoever with respect to the payment or performance of the Liabilities or the amount thereof or any payment or performance by Guarantor hereunder;

d.           all diligence in collection or protection of or realization upon the Liabilities or any thereof, any obligation hereunder or any security for or guaranty of any of the foregoing;

e.           any right to direct or affect the manner or timing of Agent’s enforcement of its rights or remedies;

f.           any defense, right of set-off or other claim whatsoever (other than payment in full and performance in full of all of the Liabilities after any termination of the Credit Agreement in accordance with the terms of the Loan Documents) that any Borrower or any third party may or might have to the payment or performance of the Liabilities;

g.           any and all defenses which would otherwise arise upon the occurrence of any event or contingency described in Paragraph 1 hereof or upon the taking of any action by Agent permitted hereunder;

h.           any defense, right of set-off, claim or counterclaim whatsoever (other than payment and performance in full or part of all of the Liabilities after any termination of the Credit Agreement in accordance with the terms of the Loan Documents), and any and all other rights, benefits, protections and other defenses which Guarantor may have, against Agent now or at any time hereafter, to full payment or performance of the Liabilities pursuant to the terms of this Guaranty; and

  

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i.           all other principles or provisions of law, if any, that conflict with the terms of this Guaranty, including, without limitation, the effect of any circumstances that may or might constitute a legal or equitable discharge of a guarantor or surety.

7.           Irrevocability.  Guarantor hereby further waives all rights to revoke this Guaranty at any time, and all rights to revoke any agreement executed by Guarantor at any time to secure the payment and performance of Guarantor’s obligations under this Guaranty, including, without limitation, the Loan Documents.

8.           Waiver of Subrogation and Certain Other Rights.  Prior to the satisfaction in full of all Liabilities (other than indemnification and other contingent Obligations, in each case not yet due and payable or in respect of which no assertion of liability and no claim or demand for payment has been made), Guarantor hereby waives and shall have no right of subrogation, reimbursement, exoneration, contribution or indemnity against any Borrower or any other guarantor for any reason, including but not limited to, by reason of any payments made or acts performed by Guarantor in compliance with the obligations of Guarantor hereunder or any actions taken by Agent pursuant to this Guaranty or pursuant to the Loan Documents.

Guarantor agrees that nothing contained in this Guaranty shall prevent Agent from suing to collect on the Liabilities or from exercising concurrently or successively any rights available to it at law and/or in equity or under any of the Loan Documents, and that the exercise of any of the aforesaid rights shall not constitute a legal or equitable discharge of Guarantor.  Guarantor hereby authorizes and empowers Agent to exercise, in its sole discretion, any rights and remedies, or any combination thereof, which may then be available, since it is the intent and purpose of Guarantor that the obligations hereunder shall be absolute, independent and unconditional under any and all circumstances.

Notwithstanding any foreclosure of the lien of any deed of trust or security agreement with respect to any or all of any real or personal property secured thereby, whether by the exercise of the power of sale contained therein, by an action for judicial foreclosure, or by the acceptance of a deed or possession of any other collateral in lieu of foreclosure, Guarantor shall remain bound under this Guaranty.  Without limiting the generality of the foregoing:

Guarantor specifically agrees that upon an Event of Default under and as defined in the Credit Agreement, Agent may elect to non-judicially or judicially foreclose against any real or personal property, including but not limited to its rights under (i) that certain Pledge Agreement executed by Guarantor in favor of Agent, dated as of the date hereof and (ii) that certain Security Agreement executed by Guarantor in favor of Agent, dated as of the date hereof, subject to any deed of trust given by any Borrower to secure all or any part of the Liabilities, or exercise any other remedy against any Borrower, any security for the Liabilities or any other guarantor, even if the effect of that action is to deprive Guarantor of the right to collect reimbursement from the applicable third party for any sums paid to Agent hereunder.

9.           Covenants.  Guarantor agrees that it shall take all action reasonably necessary to permit or enable each Borrower to comply with such Borrower’s obligations under Articles V, VI 

  

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and VII of the Credit Agreement.  Except as permitted under the Loan Documents, Guarantor shall not, until (a) indefeasible repayment in full in cash of the Obligations (other than indemnification and other contingent Obligations, in each case not yet due and payable or in respect of which no assertion of liability and no claim or demand for payment has been made), (b) the termination of the Credit Agreement and (c) all Letters of Credit issued under the Credit Agreement have expired, terminated or been fully collateralized in cash in an amount and manner satisfactory to Agent, accept any payment or other transfer of assets or funds from any Borrower including, without limitation, the payment of any management, consulting or similar fees.

 

10.           Subordination.  Guarantor hereby subordinates any and all indebtedness of each Borrower to Guarantor to the full and prompt payment and performance of all of the Liabilities.  Guarantor agrees that Agent shall be entitled to receive payment of all Liabilities prior to Guarantor’s receipt of payment of any amount of any indebtedness of any Borrower to Guarantor.  Any payments on such indebtedness to Guarantor, if Agent so requests, shall be collected, enforced and received by Guarantor, in trust, as trustee for Agent and shall be paid over to Agent on account of the Liabilities, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty.  Agent is authorized and empowered, but not obligated, in its Permitted Discretion, (a) in the name of Guarantor, to collect and enforce, and to submit claims in respect of, indebtedness of any Borrower to Guarantor and to apply any amounts received thereon to the Liabilities, and (b) to require Guarantor (i) to collect and enforce, and to submit claims in respect of, any indebtedness of the Borrowers to Guarantor, and (ii) to pay any amounts received on such indebtedness to Agent for application to the Liabilities.

11.           Assignment of Agent’s Rights.  Agent may, from time to time, without notice to Guarantor (but subject to the terms of the Credit Agreement), assign or transfer any or all of the Liabilities or any interest therein and, notwithstanding any such assignment or transfer of the Liabilities or any subsequent assignment or transfer thereof, the Liabilities shall be and remain the Liabilities for the purpose of this Guaranty.  Each and every immediate and successive assignee or transferee of any of the Liabilities or of any interest therein shall, to the extent of such party’s interest in the Liabilities, be entitled to the benefits of this Guaranty to the same extent as if such assignee or transferee were Agent; provided, however, that unless Agent shall otherwise consent in writing, Agent shall have an unimpaired right, prior and superior to that of any such assignee or transferee, to enforce this Guaranty for its own benefit as to those of the Liabilities which Agent has not assigned or transferred.

12.           Indulgences Not Waivers.  No delay in the exercise of any right or remedy shall operate as a waiver thereof, and no single or partial exercise by Agent of any right or remedy shall preclude other or further exercise thereof or the exercise of any other right or remedy; nor shall any modification or waiver of any of the provisions of this Guaranty be binding upon Agent, except as expressly set forth in a writing duly signed and delivered by Agent.  No action of Agent permitted hereunder shall in any way affect or impair the rights of Agent or the obligations of Guarantor under this Guaranty.

13.           Financial Condition of Borrowers.  Guarantor represents and warrants that it is fully aware of the financial condition of each Borrower, and Guarantor delivers this Guaranty 

  

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based solely upon its own independent investigation of such Borrower’s financial condition and in no part upon any representation or statement of Agent with respect thereto.  Guarantor further represents and warrants that it is in a position to and hereby does assume full responsibility for obtaining such additional information concerning each Borrower’s financial condition as Guarantor may deem material to its obligations hereunder, and Guarantor is not relying upon, nor expecting Agent to furnish it any information in Agent’s possession concerning such Borrower’s financial condition or concerning any circumstances bearing on the existence or creation, or the risk of nonpayment or nonperformance of the Liabilities.

 

Guarantor hereby waives any duty on the part of Agent to disclose to Guarantor any facts it may now or hereafter know about any Borrower, regardless of whether Agent has reason to believe that any such facts materially increase the risk beyond that which Guarantor intends to assume, or has reason to believe that such facts are unknown to Guarantor.

Guarantor hereby knowingly accepts the full range of risk encompassed within a contract of “Guaranty” which includes, without limitation, the possibility that any Borrower will contract for additional indebtedness for which Guarantor may be liable hereunder after such Borrower’s financial condition or ability to pay its lawful debts when they fall due has deteriorated.

14.           Representations and Warranties.  Guarantor individually represents and warrants to Agent that each of the following statements is accurate and complete as of the date of this Guaranty:

a.           Guarantor is an entity duly organized, validly, existing and in good standing under the laws of the jurisdiction of its organization and is duly qualified and in good standing in each jurisdiction where the nature of its business or properties requires such qualification, except where the failure to qualify could not have a Material Adverse Effect.  A “Material Adverse Effect” shall mean a material adverse effect on (a) the condition (financial or otherwise), results of operations, assets, business or properties of Guarantor, (b) the condition (financial or otherwise), results of operations, assets, business, properties or prospects of the Guarantor, (c) Guarantor’s ability to duly and punctually pay or perform the Liabilities and Obligations in accordance with the terms thereof, (d) the value of the Collateral, or Agent’s Liens on a material portion of the Collateral or the priority of any such Lien or (e) the practical realization of the benefits of Agent’s and each Lender’s rights and remedies under this Guaranty and the Loan Documents.

b.           the execution, delivery and performance by Guarantor of this Guaranty are within the power of Guarantor and have been duly authorized by all necessary actions on the part of Guarantor;

c.           this Guaranty has been duly executed and delivered by Guarantor and constitutes a legal, valid and binding obligation of  Guarantor, enforceable against Guarantor in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally;

  

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d.           the execution, delivery and performance of this Guaranty do not (i) violate any provisions of law or any order of any court or other agency of government, (ii) contravene any provision of Guarantor’s organizational documents or any material contract or agreement to which Guarantor is a party or by which Guarantor or Guarantor’s assets are bound or (iii) result in the creation or imposition of any lien, charge or encumbrance of any nature upon any property, asset or revenue of Guarantor except pursuant to or as set forth in the Loan Documents;

e.           all consents, approvals, orders and authorizations of, and registrations, declarations and filings with, any governmental agency or authority or other person or entity (including, without limitation, the shareholders or partners of any entity), if any, which are required to be obtained in connection with the execution and delivery of this Guaranty or the performance of Guarantor’s obligations hereunder have been obtained, and each is in full force and effect except where the failure to obtain any such matters could not reasonably be expected to result in a Material Adverse Effect;

f.           Guarantor has filed all federal, state, local and foreign (if applicable) tax returns and other reports or proper extensions thereof that each is required by law to file and, except with any properly obtained extensions, has paid all taxes, assessments, fees and other governmental charges that are due and payable.  Federal, state and local income tax returns of Guarantor have been examined and reported upon by the appropriate taxing authority or closed by applicable statute and satisfied for all fiscal years prior to and including the fiscal year ending 2011.  The provision for taxes on the books of Guarantor is adequate for all years not closed by applicable statutes, and for its current fiscal year, and Guarantor has no knowledge of any deficiency or additional assessment in connection therewith not provided for on its books;

g.           Guarantor is not in violation of any Applicable Law or contractual obligation other than any violation the consequences of which could not have or could not reasonably be expected to have a Material Adverse Effect;

h.           Guarantor is neither an investment company (as defined in the Investment Company Act of 1940) nor is controlled by an investment company;

i.           Guarantor does not have any pending or threatened litigation, arbitration, actions or proceedings which could reasonably be expected to cause or result in a Material Adverse Effect; and

j.           Guarantor hereby confirms, adopts and makes, as to itself, as if set out in full herein, all of the other representations and warranties not expressly included in this Guaranty that are set forth in the Credit Agreement and that relate or apply to Guarantor, and shall be deemed to have made all such representations and warranties as to itself in this Guaranty as if set out in full herein.

15.           Guarantor Financial Information.  Guarantor will provide Agent in writing such financial and other information with respect to its assets and liabilities as Agent shall reasonably request from time to time, in form and substance satisfactory to Agent.

  

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16.           Binding Upon Successors.  This Guaranty shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Agent and its successors and assigns.  All references herein to a “Borrower” shall be deemed to include its successors and assigns, and all references herein to a “Guarantor” shall be deemed to include Guarantor and Guarantor’s successors and assigns.

In addition and notwithstanding anything to the contrary contained in this Guaranty or in any other document, instrument or agreement between or among any of Agent, any Borrower, Guarantor or any third party, the obligations of Guarantor with respect to the Liabilities shall be joint and several with any other person or entity that now or hereafter executes a guaranty of any of the Liabilities separate from this Guaranty.

17.           Notices.  All notices required or permitted to be given hereunder shall be in writing and shall be either personally delivered, faxed to the fax numbers provided herein or sent by United States certified or registered mail, return receipt requested, addressed to Guarantor or Agent at their respective addresses stated below, or at such other address as either party hereafter notices the other party as herein provided.  Notices shall be effective at the times and in the manner set forth in Section 16.6 of the Credit Agreement.

 

	 	 
Agent’s Address for Notices:

	 	 	 	 	 
	 	 	 
If to Agent:

	PNC Bank, National Association
	 	 	 	 
2100 Ross Avenue, Suite 1850

	 	 	 	 
Dallas, Texas 75201

	 	 	 	Attention:	 
Relationship Manager (ENGlobal)

	 	 	 	Telephone:	 
(214) 871-1261

	 	 	 	Facsimile:	 
(214) 871-2015

	 	 	 	 	 
	 	 	 
and to:

	 	 
	 	 	 	 
PNC Bank, National Association

	 	 	 	 
Two Tower Center Blvd.

	 	 	 	 
East Brunswick, New Jersey 08816

	 	 	 	Attention:	 
Josephine Griffin

	 	 	 	Telephone:	 
(732) 220-4388

	 	 	 	Facsimile:	 
(732) 220-4394

	 	 	 	 	 
	 	 	 
with an additional copy to:

	 	 	 	 	 
	 	 	 	 
Patton Boggs LLP

	 	 	 	 
2000 McKinney Avenue, Suite 1700

	 	 	 	 
Dallas, Texas 75201

	 	 	 	Attention:	 
Michelle W. Suarez

 

  

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	 	 	 	Telephone:	 
(214) 758-1500

	 	 	 	Facsimile:	 
(214) 758-1550

	 	 	 	 	 
	 	 
Guarantor’s Address for Notices:

	 	 	 	 	 
	 	 	 
If to Guarantor:

	ENGlobal Emerging Markets, Inc.
	 	 	 	 
654 N. Sam Houston Parkway – Suite 400

	 	 	 	 
Houston, Texas 77060

	 	 	 	Attention:	 
Tami Walker

	 	 	 	Telephone:	 
(281) 878-1000

	 	 	 	Facsimile:	 
(281) 754-4859

	 	 	 	 	 
	 	 	 
With a copy to:

	 	 	 	 	 
	 	 	 	 
Porter Hedges LLP

	 	 	 	 
1000 Main Street, 36th Floor

	 	 	 	 
Houston, Texas  77002

	 	 	 	Attention:	 
Ephraim del Pozo

	 	 	 	Telephone:	 
(713) 226-6660

	 	 	 	Facsimile:	 
(713) 226-6260

 

18.           GOVERNING LAW; ADDITIONAL WAIVERS.  THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS APPLIED TO CONTRACTS TO BE PERFORMED WHOLLY WITHIN THE STATE OF TEXAS, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OR OTHER RULE OF LAW THAT WOULD CAUSE THE APPLICATION OF THE LAW OF ANY JURISDICTION OTHER THAN THE LAWS OF THE STATE OF TEXAS. ANY JUDICIAL PROCEEDING BROUGHT BY OR AGAINST GUARANTOR WITH RESPECT TO ANY OF THE LIABILITIES, THIS GUARANTY OR ANY RELATED AGREEMENT MAY BE BROUGHT IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS OR ANY STATE COURT IN DALLAS COUNTY, TEXAS, UNITED STATES OF AMERICA, AND, BY EXECUTION AND DELIVERY OF THIS GUARANTY, GUARANTOR ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS GUARANTY.  NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF AGENT TO BRING PROCEEDINGS AGAINST GUARANTOR IN THE COURTS OF ANY OTHER JURISDICTION.  GUARANTOR WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREUNDER AND SHALL NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON CONVENIENS.  GUARANTOR WAIVES THE RIGHT TO REMOVE ANY JUDICIAL PROCEEDING BROUGHT AGAINST GUARANTOR IN ANY STATE COURT TO ANY 

  

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FEDERAL COURT.  ANY JUDICIAL PROCEEDING BY GUARANTOR AGAINST AGENT INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS GUARANTY OR ANY RELATED AGREEMENT, SHALL BE BROUGHT ONLY IN A FEDERAL OR STATE COURT LOCATED IN THE COUNTY OF DALLAS, STATE OF TEXAS.

 

Nothing herein shall affect or impair Agent’s right to serve legal process in any manner permitted by law or Agent’s right to bring any action or proceeding against Guarantor or its property in the courts of any other jurisdiction.  Wherever possible each provision of this Guaranty shall be interpreted as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Guaranty.

GUARANTOR ACKNOWLEDGES THAT IT HAS EITHER OBTAINED THE ADVICE OF COUNSEL OR HAS HAD THE OPPORTUNITY TO OBTAIN SUCH ADVICE IN CONNECTION WITH THE TERMS AND PROVISIONS OF THIS GUARANTY AND THE LOAN DOCUMENTS.  GUARANTOR FURTHER ACKNOWLEDGES THAT BY EXECUTING THIS GUARANTY, IT IS WAIVING CERTAIN RIGHTS AS OTHERWISE SET FORTH HEREIN TO WHICH GUARANTOR MAY OTHERWISE BE ENTITLED BY LAW.

19.           ENTIRE UNDERSTANDING.  THIS GUARANTY CONTAINS THE ENTIRE UNDERSTANDING BETWEEN GUARANTOR AND AGENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES AND SUPERSEDES ALL PRIOR AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING TO THE SUBJECT MATTER HEREOF.  THERE ARE NO UNWRITTEN AGREEMENTS AMONG THE PARTIES HERETO.  ANY PROMISES, REPRESENTATIONS, WARRANTIES, OR GUARANTEES NOT HEREIN CONTAINED AND HEREINAFTER MADE SHALL HAVE NO FORCE AND EFFECT UNLESS IN WRITING, SIGNED BY GUARANTOR AND AGENT’S RESPECTIVE OFFICERS.  NEITHER THIS GUARANTY NOR ANY PORTION OR PROVISIONS HEREOF MAY BE CHANGED, MODIFIED, AMENDED, WAIVED, SUPPLEMENTED, DISCHARGED, CANCELLED, OR TERMINATED ORALLY OR BY ANY COURSE OF DEALING, OR IN ANY MANNER OTHER THAN BY AN AGREEMENT IN WRITING, SIGNED BY THE PARTY TO BE CHARGED.  GUARANTOR ACKNOWLEDGES THAT IT HAS BEEN ADVISED BY COUNSEL IN CONNECTION WITH THE EXECUTION OF THIS GUARANTY AND THE LOAN DOCUMENTS AND IS NOT RELYING UPON ORAL REPRESENTATIONS OR STATEMENTS INCONSISTENT WITH THE TERMS AND PROVISIONS OF THIS GUARANTY.  GUARANTOR FURTHER ACKNOWLEDGES THAT BY EXECUTING THIS GUARANTY, IT IS WAIVING CERTAIN RIGHTS AS OTHERWISE SET FORTH HEREIN TO WHICH GUARANTOR MAY OTHERWISE BE ENTITLED AT LAW.

  

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20.           Severability; Captions; Counterparts; Facsimile Signature.  If any provision of this Guaranty is adjudicated to be invalid under applicable laws or regulations, such provision shall be inapplicable to the extent of such invalidity without affecting the validity or enforceability of the remainder of this Guaranty which shall be given effect so far as possible.  The captions in this Guaranty are intended for convenience and reference only and shall not affect the meaning or interpretation of this Guaranty.  This Guaranty may be executed in one or more counterparts (which taken together, as applicable, shall constitute one and the same instrument) and by facsimile transmission or other electronic means, which signatures shall be considered original executed counterparts.  Each party to this Guaranty agrees that it will be bound by its own facsimile signature and that it accepts the facsimile signature of each other party.

21.           WAIVER OF JURY TRIAL.  EACH PARTY TO THIS GUARANTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION ARISING HEREUNDER OR IN ANY WAY CONNECTED WITH OR INCIDENTAL TO THE DEALINGS OF THE PARTIES WITH RESPECT HERETO OR THE TRANSACTIONS CONTEMPLATED HEREBY, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE.  EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS GUARANTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENTS OF THE PARTIES TO THE WAIVER OF THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY.

22.           Survival.  It is the express intention and agreement of the parties hereto that all covenants, representations, warranties, and waivers and indemnities made by Guarantor herein shall survive the execution, delivery, and termination of this Guaranty until all Obligations are performed in full and indefeasibly paid in full in cash and the Loan Documents are terminated.

23.           GUARANTOR’S WAIVER OF RIGHTS UNDER TEXAS DECEPTIVE TRADE PRACTICES ACT.  GUARANTOR WAIVES ANY RIGHTS UNDER THE DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT, SECTION § 17.41 ET SEQ. TEXAS BUSINESS & COMMERCE CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND PROTECTIONS.  AFTER CONSULTATION WITH AN ATTORNEY OF GUARANTOR’S OWN SELECTION, GUARANTOR VOLUNTARILY CONSENTS TO THIS WAIVER.  GUARANTOR EXPRESSLY WARRANTS AND REPRESENTS THAT GUARANTOR (A) IS NOT IN A SIGNIFICANTLY DISPARATE BARGAINING POSITION RELATIVE TO AGENT, AND (B) HAS BEEN REPRESENTED BY LEGAL COUNSEL IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTY.

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EXECUTION COPY

 

IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly executed as of the date first written above.

 

	 	 
GUARANTOR

	 	 	 
	 	 
ENGLOBAL EMERGING MARKETS, INC.

	 	 	 
	 	 	 
	 	By:	 
/s/ Edward L. Pagano

	 	Name:	 
Edward L. Pagano

	 	Title:	 
President and Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Guaranty]

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