Sample Business Contracts

Continuing Guarantee - SkyMall Inc., Durham & Co. and Imperial Bank

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                              CONTINUING GUARANTEE

TO:      IMPERIAL BANK, a California banking corporation

         1. For valuable  consideration,  the  undersigned  (hereinafter  called
"Guarantor"),  whose  address is set forth after  Guarantor's  signature  below,
jointly and severally,  and  unconditionally,  guarantees and promises to pay to
IMPERIAL BANK, a California banking  corporation  (hereinafter called "Lender"),
or  order,  on  demand,  in  lawful  money  of the  United  States,  any and all
indebtedness of SKYMALL, INC., a Nevada corporation,, inc., a Nevada
corporation and DURHAM & COMPANY, a Utah corporation (hereinafter, severally and
collectively,  called "Borrower"), to Lender pursuant to that certain Credit and
Security Agreement dated June 30, 1999, as amended by that certain  Modification
Agreement  of  even  date   herewith,   by  and  between   Borrower  and  Lender
(hereinafter,   severally   and   collectively,   called   "Credit   Agreement")
attributable  to the  Maximum  Guaranteed  Loan Amount (as defined in the Credit
Agreement) and not to the Maximum  Adjusted Cash Flow Loan Amount (as defined in
the Credit  Agreement).  If more than one Borrower is named  herein,  or if this
Guarantee is executed by more than one  Guarantor,  the word  "Borrower" and the
word  "Guarantor"  respectively  shall  mean  all and  any one or more of  them,
severally  and  collectively.  The  word  "indebtedness"  is  used  in its  most
comprehensive  sense and includes any and all advances,  debts,  obligations and
liabilities of Borrower heretofore,  now or hereafter made, incurred or created,
with or without  notice to  Guarantor,  whether  voluntary  or  involuntary  and
however arising,  whether due or not due, absolute or contingent,  liquidated or
unliquidated,  determined  or  undetermined,  and  whether  Borrower  is  liable
individually or jointly with others,  or whether recovery upon such indebtedness
may be or hereafter become barred by any statute of limitations, or whether such
indebtedness  may be or hereafter  become  otherwise  unenforceable,  exclusive,
however, of any indebtedness of Borrower to Lender presently covered by existing
guaranties  executed by  Guarantor,  but  without  derogation  to such  existing
guaranties, if any, which are hereby ratified and reaffirmed.

         2. The  liability  of Guarantor  hereunder  shall not exceed at any one
time the sum of FIVE MILLION AND NO/100 DOLLARS  ($5,000,000.00)  for principal,
plus all interest  thereon and all attorneys'  fees and other costs and expenses
incurred by Lender in collecting,  compromising or enforcing the indebtedness or
in protecting or preserving any security for the indebtedness. Lender may permit
the indebtedness of Borrower to exceed such maximum  liability without impairing
the obligation of Guarantor hereunder. Any payment by Guarantor shall not reduce
Guarantor's maximum obligation  hereunder,  unless written notice to that effect
is  actually  received  by Lender at or prior to the time of such  payment.  Any
payment by or recovery from Borrower,  any other guarantor or any security shall
be credited first to that portion of the indebtedness  which exceeds the maximum
obligation of Guarantor  hereunder.  Notwithstanding any other provision in this
Guarantee  to the  contrary,  Guarantor  shall  be  totally  released  from  any
liability  for the  payment  of the  indebtedness  from and  after the date that
Borrower  satisfies  the Invested  Capital  Condition  (as defined in the Credit


         3. This is a continuing  guarantee  that shall remain in full force and
effect and includes all indebtedness  arising under future transactions or under
successive transactions which either continue then existing indebtedness or from
time to time  renew it after it has been  satisfied,  but shall not apply to any
indebtedness  created  after actual  receipt by Lender of written  notice of the
revocation of this Guarantee as to future  transactions.  Any such revocation of
this Guarantee at any time by any Guarantor as to future  transactions shall not
affect the  liability of any other  guarantor for  indebtedness  of Borrower and
shall not affect the  liability  of that  Guarantor or any other  guarantor  for
indebtedness  incurred or credit  committed  by Lender to Borrower  prior to the
effective time of that revocation; this Guarantee shall remain in full force and
effect as to all such indebtedness. The death of any Guarantor shall not operate
as a revocation  of  liability  hereunder  of the estate of that  Guarantor  for
indebtedness  created or  incurred  or credit  committed  by Lender to  Borrower
subsequent to such death until actual receipt by Lender of written notice of the
death of that  Guarantor.  Guarantor  waives notice of  revocation  given by any
other guarantor.

         4. Guarantor is providing this Guarantee at the instance and request of
Borrower to induce  Lender to extend or  continue  financial  accommodations  to
Borrower.  Guarantor  hereby  represents and warrants that Guarantor is and will
continue to be fully informed  about all aspects of the financial  condition and
business affairs of Borrower that Guarantor deems relevant to the obligations of
Guarantor  hereunder and hereby waives and fully discharges  Lender from any and
all obligations to communicate to Guarantor any information whatsoever regarding
Borrower or Borrower's financial condition or business affairs.

         5. Guarantor  authorizes  Lender,  without notice or demand and without
affecting  Guarantor's  liability  hereunder,  from time to time, to: (a) renew,
modify, compromise,  extend, accelerate or otherwise change the time for payment
of, or  otherwise  change  the terms of the  indebtedness  or any part  thereof,
including  increasing or decreasing the rate of interest  thereon;  (b) release,
substitute or add any one or more endorsers, Guarantor or other guarantors.

         6. Upon the occurrence of an Event of Default (as defined in the Credit
Agreement) or at any time  thereafter  Lender may (a) take and hold security for
the  payment of this  Guarantee  or the  indebtedness,  and  enforce,  exchange,
substitute, subordinate, waive or release any such security; (b) proceed against
such  security and direct the order or manner of sale of such security as Lender
in its  discretion  may  determine;  and (c)  apply  any and all  payments  from
Borrower, Guarantor or any other guarantor, or recoveries from such security, in
such order or manner as Lender in its discretion may determine.

         7. Guarantor waives and agrees not to assert:  (a) any right to require
Lender to proceed against Borrower or any other guarantor, to proceed against or
exhaust any security for the indebtedness,  to pursue any other remedy available
to Lender,  or to pursue any remedy in any particular  order or manner;  (b) the
benefit of any statute of limitations  affecting Guarantor's liability hereunder
or the  enforcement  hereof;  (c) demand,  diligence,  presentment  for payment,
protest  and  demand,  and  notice  of  extension,  dishonor,  protest,  demand,
nonpayment  and  acceptance  of this  Guarantee;  (d)  notice of the  existence,
creation or incurring of new or additional  indebtedness  of Borrower to Lender;
(e) the benefits of any statutory  provision limiting the liability of a surety,


including without limitation the provisions of A.R.S. Sections 12-1641, et seq.,
to the extent applicable; (f) any defense arising by reason of any disability or
other  defense  of  Borrower  or by  reason  of the  cessation  from  any  cause
whatsoever  (other than  payment in full) of the  liability  of Borrower for the
indebtedness;  (g) any  defense  based upon an  election  of remedies by Lender,
including,   without  limitation,   any  election  to  proceed  by  judicial  or
nonjudicial  foreclosure  of any  security,  whether  real  property or personal
property security,  or by deed in lieu thereof,  and whether or not every aspect
of any foreclosure sale is commercially reasonable, or any election of remedies,
including  but not limited to,  remedies  relating to real  property or personal
property security, which destroys or otherwise impairs the subrogation rights of
Guarantor  or the  rights  of  Guarantor  to  proceed  against  Borrower  or any
guarantor for reimbursement,  or both; (h) to the extent permitted by applicable
law, the  benefits of any  statutory  provision  limiting the right of Lender to
recover a deficiency  judgment,  or to otherwise  proceed  against any person or
entity  obligated  for payment of the  indebtedness,  after any  foreclosure  or
trustee's sale of any security for the  indebtedness;  and (i) without  limiting
the generality of the foregoing or any other  provision  hereof,  any rights and
benefits which might otherwise be available to Guarantor under  California Civil
Code Sections 2809,  2810, 2819, 2839, 2845, 2848, 2849, 2850, 2899 and 3433, or
any successor  sections,  to the extent  applicable.  Guarantor hereby expressly
consents to any impairment of collateral, including, but not limited to, failure
to perfect a security interest and release collateral and any such impairment or
release shall not affect  Guarantor's  obligations  hereunder.  Until payment in
full of the  indebtedness,  Guarantor  shall  have no right of  subrogation  and
hereby  waives any right to  enforce  any remedy  which  Lender now has,  or may
hereafter have,  against  Borrower,  and waives any benefit of, and any right to
participate  in,  any  security  now or  hereafter  held  by  Lender.  Guarantor
understands  and   acknowledges   that  if  Lender   forecloses   judicially  or
nonjudicially  against any real  property  security for the  indebtedness,  that
foreclosure  could impair or destroy any ability that Guarantor may have to seek
reimbursement,  contribution or indemnification from Borrower or others based on
any right  Guarantor may have of  subrogation,  reimbursement,  contribution  or
indemnification  for  any  amounts  paid  by  Guarantor  under  this  Guarantee.
Guarantor  further  understands  and  acknowledges  that in the  absence of this
Paragraph 7, such potential  impairment or destruction of Guarantor's rights, if
any,  may  entitle  Guarantor  to assert a defense  to this  Guarantee  based on
Section 580d of the California  Code of Civil  Procedure as interpreted in Union
Bank v.  Gradsky,  265 Cal.  App.  2d 40 (1968),  to the extent  applicable.  By
executing this Guarantee, Guarantor freely, irrevocably and unconditionally: (i)
waives and  relinquishes  that defense and agrees that  Guarantor  will be fully
liable under this  Guarantee  even though  Lender may  foreclose  judicially  or
nonjudicially  against any real  property  security for the  indebtedness;  (ii)
agrees that  Guarantor  will not assert that defense in any action or proceeding
which Lender may commence to enforce this Guarantee;  and (iii) acknowledges and
agrees that Lender is relying on this  waiver in making the loans  evidenced  by
the Note,  and that this waiver is a material  part of the  consideration  which
Lender is  receiving  for making  such  Loans.  Guarantor  waives all rights and
defenses  arising out of an  election  of  remedies by Lender,  even though that
election of remedies, such as a nonjudicial foreclosure with respect to security
for a guaranteed obligation, has destroyed the guarantor's rights of subrogation
and reimbursement  against the principal by the operation of Section 580d of the
Code of Civil Procedure or otherwise.


         Guarantor  waives all  rights  and  defenses  that  Guarantor  may have
because the  indebtedness is secured by real property.  This means,  among other

                  (a)  Lender  may  collect   from   Guarantor   without   first
         foreclosing  on any real or  personal  property  collateral  pledged by

                  (b)  If Lender  forecloses  on any  real  property  collateral
         pledged by Borrower:

                       (i)  The indebtedness  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.

                       (ii) 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 is an  unconditional  and  irrevocable  waiver of any  rights  and
defenses  Guarantor  may  have  because  the  indebtedness  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 or Section 2848 of the California Civil Code.

         8. All  existing  and future  indebtedness  of Borrower to Guarantor is
hereby  subordinated  to  the  indebtedness  of  Borrower  to  Lender  and  such
indebtedness  of  Borrower  to  Guarantor,  if  Lender  so  requests,  shall  be
collected, enforced and received by Guarantor as trustee for Lender and shall be
paid over to Lender on account of the  indebtedness  of Borrower to Lender,  but
without reducing or affecting in any manner the liability of Guarantor under the
other provisions of this Guarantee.

         9. In  addition to all liens upon,  and rights of setoff  against,  the
monies, securities or other property of Guarantor given to Lender by law, Lender
shall have a lien and a right of setoff against,  and Guarantor hereby grants to
Lender a security  interest  in, all monies,  securities  and other  property of
Guarantor  now and  hereafter  in the  possession  of or on deposit with Lender,
whether held in a general or special  account or deposit,  or for safekeeping or
otherwise;  every such lien and right of setoff may be exercised  without demand
upon or notice to Guarantor.  No lien or right of setoff shall be deemed to have
been  waived by any act or  conduct  on the part of  Lender,  by any  neglect to
exercise  such  right of setoff or to enforce  such lien,  or by any delay in so

         10. If Borrower is a corporation  or  partnership,  it is not necessary
for Lender to inquire  into the powers of Borrower or the  officers,  directors,
partners  or  agents  acting  or  purporting  to  act  on its  behalf,  and  any
indebtedness  made or created in reliance  upon the  professed  exercise of such
powers shall be guaranteed hereunder.



         11. Guarantor agrees to deliver to Lender financial statements,  income
tax returns and other  financial  information  in form and level of detail,  and
containing certifications,  as and to the extent required pursuant to the Credit

         12. All financial  statements,  income tax returns and other  financial
information previously or hereafter given to Lender by or on behalf of Guarantor
are and shall be true, complete and correct as of the date thereof.

         13. Guarantor agrees to pay all attorneys' fees and all other costs and
expenses which may be incurred by Lender in enforcing this Guarantee.

         14. The  obligations  of Guarantor  hereunder  are joint and several if
Guarantor is more than one person or entity, are separate and independent of the
obligations  of Borrower and of any other  guarantor,  and a separate  action or
actions  may be brought  and  prosecuted  against  Guarantor  whether  action is
brought against Borrower or any other guarantor or whether Borrower or any other
guarantor  is joined in any action or  actions.  The  obligations  of  Guarantor
hereunder  shall  survive and continue in full force and effect until payment in
full of the  indebtedness is actually  received by Lender,  notwithstanding  any
release or termination of Borrower's  liability by express or implied  agreement
with Lender or by operation of law and notwithstanding  that the indebtedness or
any part thereof is deemed to have been paid or  discharged  by operation of law
or by some act or  agreement  of Lender.  For  purposes of this  Guarantee,  the
indebtedness  shall be deemed to be paid only to the extent that Lender actually
receives  immediately  available  funds and to the  extent of any  credit bid by
Lender  at  any   foreclosure   or  trustee's  sale  of  any  security  for  the

         15. This  Guarantee  sets forth the entire  agreement of Guarantor  and
Lender with respect to the subject  matter hereof and  supersedes all prior oral
and  written  agreements  and   representations  by  Lender  to  Guarantor.   No
modification or waiver of any provision of this Guarantee or any right of Lender
hereunder and no release of Guarantor  from any  obligation  hereunder  shall be
effective unless in a writing executed by an authorized officer of Lender. There
are no conditions, oral or otherwise, on the effectiveness of this Guarantee.

         16.  This  Guarantee  shall  inure to the  benefit  of  Lender  and its
successors  and  assigns  and shall be  binding  upon  Guarantor  and its heirs,
personal  representatives,  successors  and  assigns.  Lender  may  assign  this
Guarantee in whole or in part without notice.

         17. Guarantor agrees that to the extent Borrower or Guarantor makes any
payment to Lender in connection  with the  indebtedness,  and all or any part of
such  payment  is  subsequently  invalidated,   declared  to  be  fraudulent  or
preferential,  set  aside or  required  to be repaid by Lender or paid over to a
trustee,  receiver or any other  entity,  whether  under any  bankruptcy  act or
otherwise  (any such  payment  is  hereinafter  referred  to as a  "Preferential
Payment"),  then this  Guarantee  shall  continue  to be  effective  or shall be
reinstated,  as the case may be, and, to the extent of such payment or repayment


by Lender,  the  indebtedness  or part thereof  intended to be satisfied by such
Preferential  Payment shall be revived and continued in full force and effect as
if said Preferential Payment had not been made.

         18. Guarantor represents and warrants to Lender that: (a) (if Guarantor
is not a natural  person) it is duly  organized,  validly  existing  and in good
standing under the laws of the jurisdiction of its  organization;  (b) Guarantor
has full capacity and authority to execute,  deliver and perform this Guarantee,
and the  execution,  delivery and  performance  of this  Guarantee  will not (i)
violate  any law or  regulation,  (ii) (if  Guarantor  is not a natural  person)
violate any provision of Guarantor's  organizational documents, (iii) violate or
constitute  (with  due  notice  or lapse of time or both) a  default  under  any
indenture,  agreement, license or other instrument to which Guarantor is a party
or by which  Guarantor  or any of  Guarantor's  properties  may be  bound,  (iv)
violate  any order of any court,  tribunal  or  governmental  agency  binding on
Guarantor  or any of  Guarantor's  properties,  (v)  result in the  creation  or
imposition of any lien of any nature whatsoever on any of Guarantor's properties
or assets,  (vi) render Guarantor  insolvent under generally accepted accounting
principles,  (vii)  leave  Guarantor  with  remaining  assets  which  constitute
unreasonably small capital given the nature of its business, or (viii) result in
the   incurrence  of  debts  (whether   matured  or  unmatured,   liquidated  or
unliquidated,  absolute,  fixed or contingent) beyond Guarantor's ability to pay
them when and as they  become  due;  (c) no approval or consent of, or filing or
registration with, any federal,  state or local regulatory authority is required
in connection  with the execution,  delivery and  performance of this Guarantee;
and (d) this Guarantee  constitutes the legal,  valid and binding  obligation of
Guarantor,  enforceable  against  Guarantor in accordance with its terms.  These
representations and warranties shall survive the execution of this Guarantee. As
used in this  paragraph,  "insolvent"  means the present fair saleable  value of
assets is less than the probable  amount  required to be paid on existing  debts
when and as they mature.

         19.      Reference Provision.

                  (a) Each  controversy,  dispute or claim ("Claim") between the
         parties arising out of or relating to this Guarantee  and/or any of the
         Loan  Documents  (as  defined  in the Credit  Agreement),  which is not
         settled in writing  within ten days after the "Claim Date"  (defined as
         the date on which a party  gives  written  notice to all other  parties
         that a  controversy,  dispute  or claim  exists),  will be settled by a
         reference proceeding in Los Angeles, California, in accordance with the
         provisions  of Section 638, et seq.,  of the  California  Code of Civil
         Procedure,  or their successor section ("CCP"),  which shall constitute
         the exclusive remedy for the settlement of any Claim, including whether
         such Claim is subject to the reference proceeding and the parties waive
         their  rights to initiate any legal  proceedings  against each other in
         any court or jurisdiction  other than the Superior Court of Los Angeles
         (the "Court").  The referee shall be a retired Judge selected by mutual
         agreement  of the  parties,  and if they cannot so agree with in thirty
         days (30) after the Claim Date,  the  referee  shall be selected by the
         Presiding Judge of the Court.  The referee shall be appointed to sit as
         a temporary  judge,  as  authorized  by law.  The referee  shall (a) be
         requested  to set the matter for hearing  within  sixty (60) days after


         the Claim Date and (b) try any and all issues of law or fact and report
         a statement of decision upon them, if possible, within ninety (90) days
         of the Claim Date. Any decision  rendered by the referee will be final,
         binding and conclusive  and judgment  shall be entered  pursuant to CCP
         644 in the Court.  All discovery  permitted by this Guarantee  shall be
         completed no later than fifteen (15) days before the first hearing date
         established  by the referee.  The referee may extend such period in the
         event of a party's  refusal  to  provide  requested  discovery  for any
         reason  whatsoever,  including,  without  limitation,  legal objections
         raised to such discovery or  unavailability of a witness due to absence
         or  illness.  No party shall be entitled  to  "priority"  in  conducing
         discovery. Depositions may be taken by either party upon seven (7) days
         written notice,  and, request for production of inspection of documents
         shall be responded to within ten (10) days after service.  All disputes
         relating to discovery  which cannot be resolved by the parties shall be
         submitted to the referee whose decision shall be final and binding upon
         the parties.

                  (b) The referee  shall be required to determine  all issues in
         accordance  with existing case law and the statutory  laws of the State
         of California.  The rules of evidence  applicable to proceedings at law
         in the  State  of  California  will  be  applicable  to  the  reference
         proceeding.  The referee shall be empowered to enter  equitable as well
         as legal relief, to provide all temporary and/or  provisional  remedies
         and to enter  equitable  orders that will be binding  upon the parties.
         The referee shall issue a single judgment at the close of the reference
         proceeding which shall dispose of all of the claims of the parties that
         are the subject to the reference.  The parties hereto expressly reserve
         the  right  to  contest  or  appeal  from  the  final  judgment  or any
         appealable  order or appealable  judgment  entered by the referee.  The
         parties expressly reserve the right to findings of fact, conclusions of
         law, a written  statement of decision,  and the right to move for a new
         trial or a different judgment,  which new trial, if granted, is also to
         be a reference proceeding under this provision.

                  (c) No provision of  Paragraphs  (a) or (b) of this Section 18
         however, shall limit the right of Lender to bring action for possession
         of any collateral in any jurisdiction,  wherever located, in accordance
         with the provisions of the Loan Documents.

         20.  Notwithstanding  any waiver of or  references  to Arizona  Revised
Statutes  contained in Paragraph 6 hereof,  this Guarantee  shall be governed by
and construed in accordance with the substantive laws (other than conflict laws)
of the State of  California,  except to the extent Lender has greater  rights or
remedies  under Federal law,  whether as a national bank or otherwise,  in which
case such choice of California  law shall not be deemed to deprive Lender of any
such rights and remedies as may be available  under Federal law.  Subject to the
provisions  of  Section  18  hereof,   each  party   consents  to  the  personal
jurisdiction  and venue of the state  courts  located in Los  Angeles,  State of
California in connection with any controversy related to this Guarantee,  waives


any argument that venue in any such forum is not  convenient and agrees that any
litigation  initiated by any of them in connection  with this Guarantee shall be
venued in the  Superior  Court of Los Angeles  County,  California.  The parties
waive  any  right to  trial  by jury in any  action  or  proceeding  based on or
pertaining to this Guarantee.


          IN WITNESS WHEREOF,  these  presents  are  executed  as of the 1st day
of September, 1999.


                                             /s/ Robert M. Worsley
                                             ROBERT M. WORSLEY

                                             /s/ Christi M. Worsley
                                             CHRISTI M. WORSLEY