LIMITED PERSONAL GUARANTY

[// GUIDANCE: This is a limited personal guaranty where the Guarantor's liability is capped at a specified maximum amount. This form is often used for minority owners (less than 20% equity) or when negotiated with the lender. Be aware that "bad boy" carve-outs may convert this to an unlimited guaranty upon certain triggering events. Courts construe guaranties in favor of guarantors when ambiguous.]

TABLE OF CONTENTS

I. Document Header
II. Definitions
III. Guaranty Provisions
IV. Representations & Warranties
V. Covenants & Restrictions
VI. Default & Remedies
VII. Waivers
VIII. Risk Allocation
IX. Dispute Resolution
X. General Provisions
XI. Execution Block

I. DOCUMENT HEADER

LIMITED PERSONAL GUARANTY

This Limited Personal Guaranty (this "Guaranty") is made and entered into as of [EFFECTIVE DATE] (the "Effective Date") by:

GUARANTOR:
[GUARANTOR FULL LEGAL NAME], an individual residing at [GUARANTOR ADDRESS] ("Guarantor")

in favor of:

LENDER:
[LENDER LEGAL NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] having its principal place of business at [LENDER ADDRESS] ("Lender")

Recitals

A. [BORROWER LEGAL NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] ("Borrower"), has requested that Lender extend credit or other financial accommodations to Borrower pursuant to that certain [LOAN AGREEMENT/CREDIT AGREEMENT/PROMISSORY NOTE] dated [DATE] (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement").

B. Guarantor is [the owner of [___]% of the equity interests in Borrower / a principal officer of Borrower / directly or indirectly benefited by the extension of credit to Borrower].

C. As a condition to extending credit under the Credit Agreement, Lender requires that Guarantor execute and deliver this limited Guaranty.

D. Guarantor acknowledges that Guarantor will derive substantial direct and indirect benefit from the extension of credit to Borrower.

NOW, THEREFORE, in consideration of the extension of credit to Borrower and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor agrees as follows:

II. DEFINITIONS

For purposes of this Guaranty:

"Guaranteed Maximum Amount" means [DOLLAR AMOUNT IN WORDS] Dollars ($[NUMERICAL AMOUNT]), which is the maximum aggregate liability of Guarantor under this Guaranty, subject to the Carve-Out Events provisions of Section 3.4.

"Guaranteed Obligations" means, subject to the Guaranteed Maximum Amount, any and all present and future indebtedness, liabilities, and obligations of Borrower to Lender arising under or in connection with the Credit Agreement or any other Loan Document, including:
(a) principal, interest (including post-petition interest), fees, costs, and expenses;
(b) obligations arising from renewals, extensions, modifications, or refinancing; and
(c) costs of collection and enforcement, including reasonable attorneys' fees.

"Guaranteed Percentage" means [___]%, being Guarantor's proportionate share of the Guaranteed Obligations (if applicable).

"Loan Documents" means the Credit Agreement, any promissory note, security agreement, mortgage, deed of trust, and all other documents executed in connection with the Credit Agreement.

"Person" means any individual, corporation, partnership, limited liability company, trust, or other entity.

III. GUARANTY PROVISIONS

3.1 Limited Guaranty of Payment

Guarantor hereby guarantees to Lender the full and punctual payment and performance of the Guaranteed Obligations, up to but not exceeding the Guaranteed Maximum Amount, plus costs of collection as provided herein. This is a guaranty of payment and not merely of collection.

3.2 Limitation on Liability

GUARANTOR'S AGGREGATE LIABILITY UNDER THIS GUARANTY SHALL NOT EXCEED THE GUARANTEED MAXIMUM AMOUNT OF $[AMOUNT], plus:
(a) reasonable attorneys' fees and costs of collection actually incurred by Lender in enforcing this Guaranty; and
(b) interest on amounts due from Guarantor hereunder from the date of demand at the rate specified in the Credit Agreement.

[// GUIDANCE: Carefully negotiate whether collection costs are within or outside the cap. The above structure places collection costs outside the cap, which is lender-favorable. A guarantor-favorable approach would include all costs within the cap.]

3.3 Pro Rata Limitation (if applicable)

☐ Check if applicable: Guarantor's liability shall be limited to the Guaranteed Percentage of the outstanding Guaranteed Obligations, not to exceed the Guaranteed Maximum Amount.

3.4 Carve-Out Events ("Bad Boy" Guaranty)

NOTWITHSTANDING THE FOREGOING LIMITATIONS, GUARANTOR SHALL BE PERSONALLY LIABLE FOR THE FULL AMOUNT OF THE GUARANTEED OBLIGATIONS (WITHOUT REGARD TO THE GUARANTEED MAXIMUM AMOUNT) UPON THE OCCURRENCE OF ANY OF THE FOLLOWING CARVE-OUT EVENTS:

(a) Fraud, intentional misrepresentation, or willful misconduct by Borrower or Guarantor in connection with the Loan Documents;
(b) Misappropriation or misapplication of any rents, security deposits, insurance proceeds, or condemnation awards;
(c) Waste or intentional destruction of any collateral securing the Guaranteed Obligations;
(d) Voluntary filing of a bankruptcy petition by Borrower or Guarantor, or collusion with creditors in an involuntary bankruptcy filing;
(e) Transfer of any collateral in violation of the Loan Documents;
(f) Failure to maintain required insurance on any collateral; or
(g) Violation of any environmental laws resulting in environmental contamination of any real property collateral.

[// GUIDANCE: These "bad boy" carve-outs are heavily negotiated. Guarantors should seek to narrow these events; lenders seek to expand them. Each carve-out can potentially convert the limited guaranty into full recourse.]

3.5 Unconditional Nature (Subject to Limitations)

Subject to the Guaranteed Maximum Amount and except as expressly provided herein, the obligations of Guarantor hereunder are absolute and unconditional, irrespective of:
(a) the validity or enforceability of the Credit Agreement;
(b) any change in the time, manner, or place of payment;
(c) any release, exchange, or non-perfection of any collateral;
(d) any release of any other guarantor;
(e) any change in Borrower's corporate existence or ownership;
(f) any insolvency or bankruptcy proceeding affecting Borrower; or
(g) any other circumstance that might otherwise constitute a defense.

3.6 Continuing Guaranty

This Guaranty is a continuing guaranty and shall remain in full force and effect until the earlier of: (a) indefeasible payment in full of all Guaranteed Obligations and termination of all commitments to extend credit; or (b) payment by Guarantor of the Guaranteed Maximum Amount.

3.7 Reinstatement

This Guaranty shall continue to be effective or be reinstated if at any time any payment made by Borrower or Guarantor is rescinded or must be returned by Lender pursuant to any bankruptcy, insolvency, or similar law.

IV. REPRESENTATIONS & WARRANTIES

Guarantor represents and warrants to Lender as of the Effective Date and continuing thereafter:

4.1 Capacity and Authority

Guarantor has full legal capacity and authority to execute, deliver, and perform this Guaranty.

4.2 No Conflicts

The execution, delivery, and performance of this Guaranty do not violate any law, regulation, court order, or agreement to which Guarantor is subject.

4.3 Financial Condition

All financial statements and information provided by Guarantor to Lender are true, complete, and accurate in all material respects.

4.4 Solvency

Guarantor is solvent and will not be rendered insolvent by the execution and performance of this Guaranty.

4.5 Benefit

Guarantor has received or will receive direct or indirect benefit from the extension of credit to Borrower.

4.6 Independent Investigation

Guarantor has independently investigated the financial condition of Borrower and has made an independent decision to enter into this Guaranty.

4.7 Understanding of Carve-Outs

Guarantor has read and understands the Carve-Out Events provisions of Section 3.4 and acknowledges that such events may result in personal liability exceeding the Guaranteed Maximum Amount.

V. COVENANTS & RESTRICTIONS

5.1 Affirmative Covenants

Until all Guaranteed Obligations are paid in full or this Guaranty is terminated, Guarantor shall:
(a) promptly notify Lender of any material adverse change in Guarantor's financial condition;
(b) upon Lender's request, furnish updated financial statements and tax returns;
(c) notify Lender within [30] days of any change in Guarantor's address;
(d) promptly notify Lender of any Carve-Out Event or potential Carve-Out Event; and
(e) cooperate fully with Lender in connection with enforcement of this Guaranty.

5.2 Negative Covenants

Without Lender's prior written consent, Guarantor shall not:
(a) transfer assets for less than reasonably equivalent value;
(b) incur additional indebtedness that would materially impair Guarantor's ability to perform under this Guaranty; or
(c) take any action that would trigger a Carve-Out Event.

VI. DEFAULT & REMEDIES

6.1 Events of Default

The occurrence of any of the following shall constitute an Event of Default:
(a) any Event of Default under the Credit Agreement or any Loan Document;
(b) failure of Guarantor to perform any obligation under this Guaranty;
(c) any representation or warranty by Guarantor proves materially untrue;
(d) Guarantor becomes insolvent or files any bankruptcy petition;
(e) a material adverse change in the financial condition of Guarantor;
(f) death of Guarantor (estate remains liable up to Guaranteed Maximum Amount); or
(g) occurrence of any Carve-Out Event.

6.2 Remedies

Upon the occurrence of an Event of Default, Lender may, without notice or demand:
(a) declare all Guaranteed Obligations (up to the Guaranteed Maximum Amount, unless a Carve-Out Event has occurred) immediately due and payable from Guarantor;
(b) exercise any and all rights and remedies available at law or in equity;
(c) set off any amounts owing by Lender to Guarantor against amounts owed under this Guaranty; and
(d) proceed directly against Guarantor without first proceeding against Borrower, any collateral, or any other guarantor.

6.3 Application of Payments

All amounts received from Guarantor shall be applied first to Guaranteed Obligations not subject to any limitation, then to Guaranteed Obligations subject to the Guaranteed Maximum Amount.

6.4 Costs of Collection

Guarantor shall pay all costs and expenses (including reasonable attorneys' fees) incurred by Lender in enforcing this Guaranty. Such costs shall be in addition to the Guaranteed Maximum Amount.

VII. WAIVERS

7.1 Specific Waivers

Guarantor hereby waives, to the fullest extent permitted by law:

(a) Notice Waivers. Any requirement that Lender notify Guarantor of: acceptance of this Guaranty; any extension of credit to Borrower; any default by Borrower; any demand for payment; any intent to accelerate; any protest, dishonor, or nonpayment.

(b) Suretyship Defenses. All defenses available to a surety or guarantor, including any right to require Lender to: proceed against Borrower or any other Person; proceed against or exhaust any collateral; pursue any other remedy; or make any presentment, demand, or protest.

(c) Marshaling. Any right to require Lender to marshal assets or proceed in any particular order.

(d) Subrogation. Until all Guaranteed Obligations are indefeasibly paid in full, Guarantor waives any right of subrogation against Borrower.

(e) Contribution. Until all Guaranteed Obligations are indefeasibly paid in full, Guarantor waives any right of contribution from any other guarantor.

7.2 Consent to Modifications

Guarantor consents to any modification, extension, renewal, or release of any Guaranteed Obligation or collateral, without notice and without affecting Guarantor's liability under this Guaranty (subject to the Guaranteed Maximum Amount).

7.3 Revocation

Guarantor may revoke this Guaranty as to future advances by delivering written notice to Lender by registered mail. Such revocation shall be effective upon Lender's actual receipt and shall not affect Guarantor's liability for:
(a) Guaranteed Obligations existing at the time of revocation;
(b) advances made pursuant to commitments existing at the time of revocation; and
(c) renewals, extensions, or modifications of obligations described in (a) or (b).

VIII. RISK ALLOCATION

8.1 Indemnification

Guarantor shall indemnify and hold harmless Lender from and against any losses, liabilities, damages, costs, and expenses (including reasonable attorneys' fees) arising out of: (a) any breach of this Guaranty; (b) enforcement of this Guaranty; or (c) any Carve-Out Event.

8.2 Limitation on Liability

Except upon the occurrence of a Carve-Out Event, Guarantor's aggregate liability under this Guaranty shall not exceed the Guaranteed Maximum Amount plus collection costs as provided herein.

8.3 Force Majeure

Force majeure events shall not excuse Guarantor's payment obligations under this Guaranty.

IX. DISPUTE RESOLUTION

9.1 Governing Law

This Guaranty shall be governed by and construed in accordance with the laws of the State of [GOVERNING LAW STATE], without regard to its conflict-of-laws principles.

9.2 Forum Selection

Guarantor irrevocably submits to the exclusive jurisdiction of the state and federal courts located in [COUNTY, STATE] for any action arising out of or relating to this Guaranty.

9.3 Arbitration (Optional)

☐ Check if applicable: Any dispute arising out of or relating to this Guaranty shall be resolved by binding arbitration administered by [ARBITRATION ORGANIZATION] in accordance with its commercial rules.

9.4 Jury Trial Waiver

JURY WAIVER: GUARANTOR AND LENDER HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY.

9.5 Injunctive Relief

Nothing herein shall limit Lender's right to seek provisional or injunctive relief in any court of competent jurisdiction.

X. GENERAL PROVISIONS

10.1 Amendments and Waivers

No amendment or waiver of any provision of this Guaranty shall be effective unless in writing and signed by Lender.

10.2 Assignment

Lender may assign this Guaranty without Guarantor's consent. Guarantor may not assign any rights or obligations under this Guaranty.

10.3 Successors and Assigns

This Guaranty shall be binding upon Guarantor and Guarantor's heirs, executors, administrators, successors, and assigns.

10.4 Severability

If any provision of this Guaranty is held unenforceable, the remaining provisions shall remain in full force and effect.

10.5 Integration

This Guaranty, together with the Loan Documents, constitutes the entire agreement between the parties with respect to the subject matter hereof.

10.6 Counterparts; Electronic Signatures

This Guaranty may be executed in counterparts. Electronic signatures shall be deemed original signatures.

10.7 Notices

All notices shall be in writing and deemed given when delivered personally, sent by overnight courier, or mailed by certified mail to the addresses set forth above.

10.8 Subordination

Guarantor agrees that any indebtedness of Borrower to Guarantor is hereby subordinated to the Guaranteed Obligations.

XI. EXECUTION BLOCK

IMPORTANT NOTICE TO GUARANTOR: YOU ARE AGREEING TO BE PERSONALLY LIABLE FOR UP TO $[GUARANTEED MAXIMUM AMOUNT] OF THE BORROWER'S OBLIGATIONS TO LENDER. HOWEVER, YOUR LIABILITY MAY BECOME UNLIMITED IF ANY OF THE CARVE-OUT EVENTS DESCRIBED IN SECTION 3.4 OCCUR. YOU SHOULD CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS GUARANTY.

IN WITNESS WHEREOF, Guarantor has executed this Limited Personal Guaranty as of the date first written above.

GUARANTOR:

_____________________________________
Signature

_____________________________________
Print Name: [GUARANTOR FULL LEGAL NAME]

Date: ________________________________

SPOUSAL CONSENT (if required by state law or Lender policy)

The undersigned spouse of Guarantor hereby consents to this Guaranty and waives any community property or homestead rights that may affect Lender's rights hereunder.

_____________________________________
Spouse Signature

_____________________________________
Print Name: [SPOUSE FULL LEGAL NAME]

Date: ________________________________

ACKNOWLEDGMENT (if required)

STATE OF _____________ )
) ss.
COUNTY OF ____________ )

On this ___ day of __________, 20__, before me, the undersigned Notary Public, personally appeared [GUARANTOR NAME], proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the foregoing instrument and acknowledged that he/she executed the same voluntarily.

_____________________________________
Notary Public

My Commission Expires: _______________

ATTORNEY CHECKLIST (DO NOT INCLUDE IN FINAL DOCUMENT)

☐ Verify Guaranteed Maximum Amount is properly negotiated and documented
☐ Review Carve-Out Events carefully - these can trigger unlimited liability
☐ Confirm whether collection costs are within or outside the cap
☐ Confirm spousal consent requirements under applicable state law
☐ Review state-specific guaranty enforcement requirements
☐ Verify arbitration clause enforceability in selected jurisdiction
☐ Review jury waiver enforceability under state law
☐ Coordinate with Credit Agreement definitions
☐ Consider whether revocation rights should be included or waived

[// GUIDANCE: Limited guaranties provide a cap on the Guarantor's exposure, but Carve-Out Events can convert to unlimited liability. Negotiate these carve-outs carefully. Courts generally construe guaranties in favor of the guarantor when there is ambiguity.]

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