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ARTICLE 3. REPRESENTATIONS AND WARRANTIES. To induce Lender to extend the Guaranteed Obligations, and for other good and valuable consideration, Guarantor hereby represents and warrants to Lender that: (a) this Guaranty is the legal, valid and binding obligation of Guarantor, enforceable in accordance with its terms; (b) the execution, delivery, and performance of this Guaranty does not and will not, by the lapse of time, by the giving of notice, or the satisfaction of any other condition (i) violate or contravene any authority having the force of law applicable to the Guarantor or any of his properties or any agreement or other instrument to which Guarantor is a party or by which Guarantor or any of his properties is or may be bound, or (ii) result in the creation or imposition of any Lien on any of the properties of Guarantor; (c) the execution and delivery of this Guaranty by Guarantor does not require any consent or approval of any Person; (d) there is no action or proceeding pending before any court or governmental instrumentality or agency which materially, adversely affects the condition (financial or otherwise) of Guarantor or any of his properties; and (e) Guarantor has not guaranteed any Indebtedness of Borrower other than the Guaranteed Obligations. ARTICLE 4. COVENANTS. From the date of the execution of this Guaranty until all Guaranteed Obligations have been fully paid, performed and satisfied: Section 4.1 No Disposition of Assets; Indebtedness. Guarantor will not (a) sell, transfer or otherwise dispose of all or any portion of his properties either (i) in violation of any applicable law, or (ii) if such sale, transfer or disposition would have a material adverse affect on Guarantor's financial condition or on his ability to perform his obligations under this Guaranty; or (b) incur, create or become obligated for any Indebtedness which has a material adverse affect on Guarantor's financial condition or on his ability to perform his obligations under this Guaranty; or (c) guarantee any Indebtedness or obligations of Borrower other than the Guaranteed Obligations. Section 4.2 Payments. Guarantor will pay all of the reasonable costs, expenses and fees, including, without limitation, all reasonable attorneys' fees, incurred by Lender in enforcing or attempting to enforce this Guaranty following any default on the part of Guarantor, whether the same is enforced by suit or otherwise, and all amounts recoverable by law, including, without limitation, interest on any unpaid amounts due under this Guaranty. ARTICLE 5. DEFAULT; SUBORDINATION. Section 5.1 Payment of Guaranteed Obligations. At any time after all or any portion of the Guaranteed Obligations are due and payable, whether on maturity, after the acceleration of any of the Guaranteed Obligations, on the occurrence of an Event of Default, on the occurrence of any default under this Guaranty, or otherwise: (a) Lender will have the right: (i) to proceed directly against Guarantor under this Guaranty without first exhausting any other remedy it may have and without resorting to any security or guaranty held by Lender, and (ii) to compromise, settle, release, discharge or terminate any of the obligations of any other guarantor(s) of the Guaranteed Obligations as Lender, in its discretion, determines without thereby in any way affecting, limiting or diminishing its rights thereafter to enforce the obligations of Guarantor under this Guaranty; (b) Guarantor will, on the demand of Lender, immediately deposit with 4487552v3 4