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Section 1.3 Continuing Guaranty. Notwithstanding any of the provisions of Section 1.2 to the contrary, Guarantor will not be entitled to any credit against his obligations under this Guaranty by reason of any amounts (a) recovered by Lender by reason of the enforcement by Lender after an Event of Default of any of its remedies under the Note or (b) paid by any other person to Lender under this Guaranty. Section 1.4 Capitalized Terms. Capitalized terms used, but not defined, in this Guaranty, have the meanings attributed to them in the Note. 4487552v3 ARTICLE 2. NATURE OF THE GUARANTY. Section 2.1 Absolute Obligations. The obligations of Guarantor under this Guaranty are absolute, unconditional, and will be continuing and remain in full force and effect subject to Sections 2.2 and 2.5 below. This is a continuing guaranty of payment and not of collection. Guarantor's obligations under this Guaranty will not be released, discharged, affected, modified or impaired by any event, including, without limitation, any of the following events: (a) the compromise, settlement, release, discharge or termination of any or all of the obligations of Borrower to Lender by operation of law or otherwise, except as may result from the full and prompt performance and payment of the Guaranteed Obligations; (b) the extension of the time for payment of any obligation under the Note, or the waiver, modification or amendment (whether material or otherwise) of any obligation under the Note or the acceptance of partial payments of the Guaranteed Obligations; (c) the taking or failure to take any action under the Note or this Guaranty; (d) the invalidity or unenforceability of any provision of the Note or this Guaranty; (e) the voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all of the assets, marshaling of assets and liabilities, receivership, insolvency, bankruptcy, assignment, composition with creditors or readjustment of, or other similar proceedings affecting Borrower or Guarantor; (0 any allegation of invalidity or contest of the validity of this Guaranty in any of the proceedings described in Section 2.1(0; (g) any act, election or remedy, or other election, occurrence or circumstance of any nature, whether or not under Lender's control, that may affect or impair any subrogation right of Guarantor or the effectiveness or value thereof; (h) the default or failure of Guarantor to perform fully any of his obligations set forth in this Guaranty; (i) Lender's election, in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code "), of the application of Section 1111 (b)(2) of the Bankruptcy Code; (j) any borrowing or grant of a security interest by Borrower, as debtor -in- possession, under Section 364 of the Bankruptcy Code; 2