Exhibit 10.4
REAFFIRMATION AND RATIFICATION AGREEMENT
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September 19, 2005
Laurus Master Fund, Ltd.
c/o Laurus Capital Management LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Reference is made to (a) the Securities Purchase Agreement dated as of June
30, 2005 (as amended, modified or supplemented from time to time, the "June 2005
SPA") by and between New Century Energy Corp., a Colorado corporation (the
"Company"), and Laurus Master Fund, Ltd. ("Laurus"), (b) the Secured Convertible
Term Note dated as of June 30, 2005 made by the Company in favor of Laurus in
the aggregate principal amount of Fifteen Million Dollars ($15,000,000) (the
"June 2005 Term Note"), (c) the Subsidiary Guaranty, dated as of June 30, 2005
(as amended, modified or supplemented from time to time, the "Guaranty"), made
by Century Resources, Inc., a Delaware corporation ("Century Resources"), in
favor of Laurus, (d) the Master Security Agreement, dated as of June 30, 2005
(as amended, modified or supplemented from time to time, the "Master Security
Agreement"), among New Century Energy Corp., a Colorado corporation (the
"Company"), Century Resources and Laurus, (e) each Mortgage, Deed of Trust,
Security Agreement, Financing Statement and Assignment of Production, dated as
of June 30, 2005, made by the Company and Century Resources in favor of Laurus
(as amended, modified and supplemented from time to time, the "Mortgages") and
(f) the Stock Pledge Agreement, dated as of June 30, 2005 (as amended, modified
or supplemented from time to time, the "Pledge Agreement"), by and between the
Company and Laurus (the June 2005 SPA, the June 2005 Term Note, the Guaranty,
the Master Security Agreement, the Mortgages and the Pledge Agreement, each a
"June 2005 Agreement" and collectively, the "June 2005 Agreements").
To induce Laurus to enter into the Securities Purchase Agreement dated as
of the date hereof by and between the Company and Laurus (as amended, restated
or otherwise modified, the "September 2005 SPA") pursuant to which Laurus has
agreed to purchase from the Company a Secured Term Note in the aggregate
principal amount of Nine Million Five Hundred Thousand Dollars ($9,500,000) (the
"September 2005 Term Note"), each of the undersigned hereby:
(a) represents and warrants to Laurus that it has reviewed and approved the
terms and provisions of the September 2005 SPA, the September 2005 Term Note and
the Related Agreements (as defined in the September 2005 SPA, the "September
2005 Related Agreements") (the September 2005 SPA, the September 2005 Term Note
and the September 2005 Related Agreements, each a "September 2005 Agreement" and
collectively, the "September 2005 Agreements");
(b) acknowledges, ratifies and confirms that all of the terms, conditions,
representations and covenants contained in the June 2005 Agreements to which it
is a party are in full force and effect and shall remain in full force and
effect after giving effect to the execution and effectiveness of the September
2005 Agreements;
(c) acknowledges, ratifies and confirms that the defined term "Obligations"
under the Guaranty, the Master Security Agreement and the Mortgages and the
defined term "Indebtedness" under the Pledge Agreement include, without
limitation, all obligations and liabilities of the Company under the September
2005 Agreements, the June 2005 SPA, the Secured Convertible Term Note dated as
of June 30, 2005 made by the Company in favor of Laurus in the aggregate
principal amount of Fifteen Million Dollars ($15,000,000) (as amended, modified
and supplemented from time to time, the "June 2005 Term Note"), the Related
Agreements (as defined in the June 2005 SPA) (as amended, modified and
supplemented from time to time, the "June 2005 Related Agreements") and all
other obligations and liabilities of each of the undersigned to Laurus
(including interest accruing after the filing of any petition in bankruptcy, or
the commencement of any insolvency, reorganization or like proceeding, whether
or not a claim for post-filing or post-petition interest is allowed or allowable
in such proceeding), whether now existing or hereafter arising, direct or
indirect, liquidated or unliquidated, absolute or contingent (collectively, the
"Obligations");
(d) acknowledges and confirms that the occurrence of an Event of Default
under any of the September 2005 Agreements shall constitute an Event of Default
under the June 2005 Agreements and (ii) the occurrence of an Event of Default
under any of the June 2005 Agreements shall constitute an Event of Default under
the September 2005 Agreements;
(e) represents and warrants that no offsets, counterclaims or defenses
exist as of the date hereof with respect to any of the undersigned's obligations
under any of the June 2005 Agreements;
(f) acknowledges, ratifies and confirms (1) the grant by each undersigned
to Laurus of a security interest and lien in the assets of each undersigned as
more specifically set forth in the June 2005 Agreements and the September 2005
Agreements, as applicable (the "Security Interest Grants") and (2) that the
Security Interest Grants secure all Obligations; and
(g) releases, remises, acquits and forever discharges Laurus and Laurus'
employees, agents, representatives, consultants, attorneys, fiduciaries,
officers, directors, partners, predecessors, successors and assigns, subsidiary
corporations, parent corporations, and related corporate divisions (all of the
foregoing hereinafter called the "Released Parties"), from any and all actions
and causes of action, judgments, executions, suits, debts, claims, demands,
liabilities, obligations, damages and expenses of any and every character, known
or unknown, direct and/or indirect, at law or in equity, of whatsoever kind or
nature, for or because of any matter or things done, omitted or suffered to be
done by any of the Released Parties prior to and including the date of execution
hereof, and in any way directly or indirectly arising out of or in any way
connected to this Reaffirmation and Ratification Agreement, the June 2005
Agreements, the September 2005 Agreements and any other document, instrument or
agreement made by any of the undersigned in favor of Laurus.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
This agreement shall be governed by and construed in accordance with the
laws of the State of New York.
Very truly yours,
NEW CENTURY ENERGY CORP.
By: /s/ Xxxxxx X. XxXxxxxxx
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Name: Xxxxxx X. XxXxxxxxx
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Title: President & CEO
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Address: 0000 Xxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
CENTURY RESOURCES, INC.
By: /s/ Xxxxxx X. XxXxxxxxx
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Name: Xxxxxx X. XxXxxxxxx
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Title: President & CEO
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Address: 0000 Xxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
ACCEPTED AND AGREED TO:
LAURUS MASTER FUND, LTD.
By:/s/Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
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Title: Escrow Agent
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