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EXHIBIT 10.65
GUARANTY
THIS GUARANTY ("Guaranty"), is made and entered into as of
October 21, 1997 by EAGLE GEOPHYSICAL, INC., a Delaware corporation, acting
herein by and through its duly appointed and acting Vice President and Chief
Financial Officer (the "Guarantor"), and BANK ONE, TEXAS, N.A., a national
banking association (the "Bank").
W I T N E S S E T H:
WHEREAS, on or after the date hereof, Bank has advanced or
will advance certain funds to HORIZON EXPLORATION LIMITED, an English company
("Borrower") pursuant to that certain Revolving Credit Agreement of even date
herewith providing for loans to Borrower of up to $20,000,000.00, as may be
amended from time to time (the "Loan Agreement"), specifically including the
indebtedness evidenced by that certain promissory note of even date, executed by
Borrower and payable to BANK, in the face amount of $20,000,000.00 and all other
notes given in substitution therefor or in modification, increase, renewal or
extension thereof in whole or in part (collectively, the "Revolving Loan");
WHEREAS, as a condition to Bank's entry into said Loan
Agreement and its advance of funds to Borrower thereunder, Guarantor has agreed
to enter into this Guaranty; and
WHEREAS, Guarantor will directly and indirectly benefit from
the Revolving Loan, as defined in the Loan Agreement and evidenced and governed
thereby.
NOW, THEREFORE, for and in consideration of the premises and
the extension of credit by Bank to Borrower pursuant to the Loan Agreement, and
for TEN AND NO/100 DOLLARS ($10.00) and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and to induce Bank
to execute the Loan Agreement, Bank and Guarantor hereby agree as follows:
1. Guarantor unconditionally guarantees the prompt payment to
Bank of the following (the "Guaranteed Indebtedness"):
Any and all indebtedness, obligations and liabilities of Borrower to
Bank now existing or hereafter incurred in connection with or incident
to the Revolving Loan, under or arising out of or in connection with
any documents executed in connection with any indebtedness of Borrower
to Bank in connection with the Revolving Loan or any promissory note or
notes executed by Borrower at any time in connection with the Revolving
Loan, whether for principal, interest, penalty interest, fees,
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expenses or otherwise, including, without limitation, all sums,
principal, accrued interest and other amounts owing with respect to
the following described promissory note executed by Borrower payable
to the order of Bank, together with any and all modifications,
increases, renewals or extensions thereof, whether with or without
notice to Guarantor, specifically including the following described
note:
Original Final
Date Amount Maturity Date
October 21, 1997 $20,000,000.00 October 21, 2000
2. If the Guaranteed Indebtedness is not paid by Guarantor
when due, as required herein, and this Guaranty is placed in the hands of an
attorney for collection, or if this Guaranty is enforced by suit or through the
Bankruptcy Court or through any judicial proceedings, Guarantor shall pay to
Bank an amount equal to its reasonable attorneys' fees and collection costs
incurred by Bank in the collection of the Guaranteed Indebtedness.
3. This is an absolute, complete and continuing Guaranty, and
no notice of the Guaranteed Indebtedness or any extension of credit already or
hereafter contracted by or extended to Borrower need be given to Guarantor, nor
shall anything herein contained be a limitation upon the amount of credit which
may be extended to Borrower, the numbers of transactions with Borrower,
repayments by Borrower to Bank, or the allocation by Bank of repayment by
Borrower, it being the understanding of the Guarantor that Guarantor's liability
shall continue hereunder so long as any of the Guaranteed Indebtedness remains
unpaid. Borrower and Bank may rearrange, increase, decrease, extend and/or renew
the Guaranteed Indebtedness without notice to Guarantor and in such event
Guarantor will remain fully bound hereunder on the Guaranteed Indebtedness. The
obligations of Guarantor hereunder shall not be released, impaired or diminished
by any amendment, modification or alteration of the Loan Agreement or the Note.
Guarantor expressly waives all notices of any kind, presentment for payment,
demand for payment, protest, notice of protest, notice of intent to accelerate,
notice of acceleration, dishonor, diligence, notice of any amendment of the Loan
Agreement, notice of any adverse change in the financial condition of Borrower,
notice of any adjustment, indulgence, forbearance or compromise that might be
granted or given by Bank to Borrower, and also notice of acceptance of this
Guaranty, acceptance on the part of Bank being conclusively presumed by its
request for this Guaranty and delivery of the same to it. The liability and
obligations of Guarantor hereunder shall not be affected or impaired by any
action or inaction by Bank in regard to any matter waived or notice of which is
waived by Guarantor in this paragraph or in any other paragraph of this
Guaranty.
4. Guarantor authorizes Bank, without notice or demand and
without affecting Guarantor's liability hereunder, (a) to take and hold security
for the payment of this Guaranty and/or the Guaranteed Indebtedness, and to
exchange, enforce, waive and/or release any such security; (b) to apply such
security and direct the order or manner of sale thereof as Bank in its
discretion may determine; (c) to obtain a guaranty of the Guaranteed
Indebtedness from any one
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or more other persons, corporations or entities whomsoever and to enforce,
waive, rearrange, modify, limit or release at any time or times such other
persons, corporations or entities from their obligations under such guaranties;
(d) to waive or delay the exercise of any of its rights or remedies against the
Borrower or any other person or entity; (e) to renew, extend, or modify the
terms of any of the Guaranteed Indebtedness or any instrument or agreement
evidencing the same; and (f) to fully or partially release at any time any
Guarantor which executes this Guaranty whether with or without consideration.
5. Guarantor waives any right to require Bank to (a) proceed
against, or make any effort at the collection of the Guaranteed Indebtedness
from Borrower or any other guarantor or party liable for the Guaranteed
Indebtedness; (b) proceed against or exhaust any collateral held by Bank; or (c)
pursue any other remedy in Bank's power whatsoever. Guarantor further waives any
and all rights and remedies which Guarantor may have or be able to assert by
reason of the provisions of Chapter 34 of the Texas Business and Commerce Code.
Guarantor waives any defense arising by reason of any disability, lack of
corporate authority or power, or other defense of Borrower or any other
guarantor of the Guaranteed Indebtedness, and Guarantor shall remain liable
under this Guaranty regardless of whether Borrower or any other guarantor be
found not liable on the Guaranteed Indebtedness for any reason including,
without limitation, insanity, minority, disability, bankruptcy, insolvency,
death or corporate dissolution, even though rendering the Guaranteed
Indebtedness void or unenforceable or uncollectible as against Borrower or any
other guarantor. This Guaranty shall continue to be effective or be reinstated,
as the case may be, if at any time any payment of any of the Guaranteed
Indebtedness is rescinded or must otherwise be returned by Bank upon the
insolvency, bankruptcy or reorganization of Borrower or otherwise, all as though
such payment had not been made and will, thereupon, guarantee payment of such
amount as to which refund or restitution has been made, together with interest
accruing thereon subsequent to the date of refund or restitution at the
applicable rate under the Loan Agreement and collection costs and fees
(including, without limitation, attorneys' fees) applicable thereto, subject to
the limitations set forth in Sections 1 and 10 hereof.
6. The liability and obligations of Guarantor hereunder shall
not be affected or impaired by (a) the failure of Bank or any other party to
exercise diligence or reasonable care in the preservation, protection or other
handling or treatment of all or any part of the collateral securing payment of
all or any part of the Guaranteed Indebtedness, (b) the failure of any security
interest or lien intended to be granted or created to secure the Guaranteed
Indebtedness to be properly perfected or created or the unenforceability of any
security interest or lien for any other reason, or (c) the subordination of any
such security interest or lien to any other security interest or lien.
7. Bank may pursue any remedy without altering the obligations
of Guarantor hereunder and without liability to Guarantor, even though Bank's
pursuit of such remedy may result in Guarantor's loss of rights of subrogation
or to proceed against others for reimbursement or contribution or any other
right. In no event shall any payment by Guarantor entitle it, by subrogation or
otherwise, to any rights against Borrower or any right to participate in any
security
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now or hereafter held by Bank prior to payment in full of all of the
Guaranteed Indebtedness and, in any event, not until 367 days after the making
of any payment and/or the granting of any security interest by Borrower or any
other guarantor to Bank in connection with the Guaranteed Indebtedness.
8. Should the status of Borrower change in any way, including,
without limitation, as a result of any dissolution of Borrower, any sale, lease
or transfer of any or all of the assets of Borrower, any changes in the
shareholders of Borrower, or any reorganization of Borrower, this Guaranty shall
continue, and shall cover the Guaranteed Indebtedness under the new status.
9. The liability of Guarantor for the payment of the
Guaranteed Indebtedness shall be primary and not secondary.
10. Guarantor is familiar with and has independently reviewed
the books and records regarding the financial condition of Borrower and is
familiar with the value of any and all collateral intended to be granted as
security for the payment of the Guaranteed Indebtedness; Guarantor is not,
however, relying on such financial condition or such collateral as an inducement
to enter into this Guaranty. As of the date hereof, and after giving effect to
this Guaranty and the contingent obligations evidenced hereby, Guarantor is, and
will be, solvent, and has and will have assets and property which, valued
fairly, exceed such Guarantor's obligations, debts and liabilities (such excess
being herein called the "Net Worth" of the Guarantor), and has and will have
assets and property sufficient to satisfy, repay and discharge the same. The
liability of Guarantor hereunder is limited to (a) the lowest amount that would
render this Guaranty void against creditors or creditors' representatives under
any fraudulent conveyance or similar law or under Sections 544 or 548 of the
Bankruptcy Code of 1978, as revised, minus (b) $1.00.
11. If Borrower shall at any time or times be or become
obligated to Bank for payment of any indebtedness other than the Guaranteed
Indebtedness, Bank (without in anywise impairing its rights hereunder or
diminishing Guarantor's liability) shall be at liberty at any time or times to
apply to such other indebtedness any amounts paid to or received by or coming
into the hands of Bank from or attributable to Borrower or any other person or
party liable for any of such other indebtedness or from or attributable to or
representing proceeds of any property or security held by Bank securing payment
of such other indebtedness or any credits, deposits or offsets due Borrower or
other party liable on any of such other indebtedness (whether or not the
Guaranteed Indebtedness or such other indebtedness are then due), it being
intended to give Bank the right to apply all payments, credits and offsets and
amounts becoming available for application on or credit against the indebtedness
of Borrower to Bank (now or hereafter existing) first toward payment and
satisfaction of the Borrower's indebtedness not hereby guaranteed, before making
application thereof on or against the Guaranteed Indebtedness.
12. Guarantor represents and warrants that this Guaranty
accurately and completely embodies the entire agreement between Guarantor and
Bank with respect to the respective rights,
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obligations and liabilities of Guarantor and Bank hereunder, and supersedes all
prior agreements and understandings, if any, relating to the subject matter
hereof. Guarantor acknowledges that Guarantor is not relying on any
representations (oral or otherwise) of Bank, or any other party, other than as
expressly described in this Guaranty.
13. This Guaranty was reviewed by Guarantor, and Guarantor
acknowledges and agrees that Guarantor (a) understands fully all of the terms of
this Guaranty and the consequences and implications of Guarantor's execution of
this Guaranty, and (b) has been afforded an opportunity to have this Guaranty
reviewed by, and to discuss the terms, consequences and implications of this
Guaranty with an attorney or other such persons as Guarantor may have desired.
14. This Guaranty is and shall be in every particular available to
the successors and assigns of Bank and is and shall always be fully binding
upon the heirs, executors, administrators, successors or assigns of Guarantor.
This Guaranty is intended for and shall inure to the benefit of Bank and each
and every other person who shall from time to time be or become the owner or
holder of any of the Guaranteed Indebtedness, and each and every reference
herein to "Bank" shall also include and refer to each and every successor or
assignee of Bank at any time holding or owning any part of or interest in any
part of the Guaranteed Indebtedness. This Guaranty shall be transferable and
negotiable, with the same force and effect and to the same extent that the
Guaranteed Indebtedness is transferable, it being understood and stipulated that
upon the assignment or transfer by Bank of any of the Guaranteed Indebtedness
the legal or beneficial owner of the Guaranteed Indebtedness (or part thereof or
interest therein thus transferred or assigned by Bank) shall also, unless
provided otherwise by Bank in its assignment, have and may exercise all of the
rights granted to Bank under this Guaranty to the extent of the part of or
interest in the Guaranteed Indebtedness thus assigned or transferred to such
person or entity. Guarantor expressly waives notice of transfer or assignment of
the Guaranteed Indebtedness, or any part thereof, or of the rights of Bank
hereunder.
15. All amounts becoming payable by Guarantor to Bank under this
Guaranty shall be payable at Bank's offices in the City of Houston, Xxxxxx
County, Texas.
16. Any notice hereunder to Guarantor shall be in writing, duly
stamped and addressed to Guarantor at the address shown below Guarantor's
signature hereto, or at such other address as Guarantor may by written notice,
received by Bank, have designated as Guarantor's address for such purpose. Any
notice provided for herein shall become effective upon the earlier of (a) the
first business day of Bank following the deposit in a regularly maintained
receptacle for the United States, or (b) the day of its receipt by Guarantor;
but actual notice, however given or received, shall always be effective. The
preceding sentence shall not be construed in anywise to affect or impair any
waiver of notice or demand herein provided or to require giving of notice or
demand to or upon Guarantor in any situation or for any reason.
17. It is the intention of the parties hereto to comply strictly
with all applicable usury laws; accordingly, it is agreed that notwithstanding
any provisions to the contrary in this
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Guaranty, or in any documents securing payment hereof or otherwise relating
hereto, in no event shall this Guaranty or such documents require the payment or
permit the collection of an aggregate amount of interest in excess of the
maximum amount permitted by such laws, including the laws of the State of Texas
and the laws of the United States of America. If any such excess of interest is
contracted for, charged or received under this Guaranty or under the terms of
any documents securing payment hereof or otherwise relating hereto, or if under
any circumstances, the amount of interest (including all amounts payable
hereunder which are not denominated as interest but which constitute interest
under the applicable laws) contracted for, charged or received under this
Guaranty shall exceed the maximum amount of interest permitted by the applicable
usury laws, then in any such event (a) the provisions of this paragraph shall
govern and control, (b) Guarantor shall not be obligated to pay the amount of
such interest to the extent that it is in excess of the maximum amount of
interest permitted by the applicable usury laws, (c) any such excess interest
which may have been collected shall be either applied as a credit against the
then unpaid Guaranteed Indebtedness or, if the Guaranteed Indebtedness shall
have been paid in full, refunded to Guarantor, and (d) the effective rate of
interest shall be automatically reduced to the maximum lawful contract rate
allowed under the applicable usury laws as now or hereafter construed by the
courts having jurisdiction thereof. It is further agreed that without limitation
of the foregoing, all calculations of the rate of interest contracted for,
charged or received under this Guaranty or under such other documents which are
made for the purpose of determining whether such rate exceeds the maximum lawful
contract rate, shall be made, to the extent permitted by applicable usury laws,
by amortizing, prorating, allocating and spreading in equal parts during the
full period during which this Guaranty is to be in effect, all interest at any
time contracted for, charged or received from Guarantor or otherwise by the
holder or holders hereof in connection with this Guaranty.
18. In case any of the provisions of this Guaranty shall for any
reason be held to be invalid, illegal, or unenforceable, such invalidity,
illegality, or unenforceability shall not affect any other provisions hereof,
and this Guaranty shall be construed as if such invalid, illegal, or
unenforceable provision had never been contained herein.
19. In all instances herein, the singular shall be construed to
include the plural and the masculine to include the feminine.
20. This Guaranty may be executed in multiple counterparts each of
which shall constitute an original, but all of which when taken together shall
constitute one and the same Guaranty.
21. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF TEXAS AND THE UNITED STATES OF AMERICA. All
actions or proceedings with respect to the Guaranteed Indebtedness or this
Guaranty may be instituted in the Courts of the State of Texas located in Xxxxxx
County, Texas, or the United States District Court for the Southern District of
Texas, and by execution and delivery of this Guaranty, Guarantor irrevocably and
unconditionally submits to the jurisdiction (both subject matter and personal)
of each such Court, and irrevocably and unconditionally waives
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(a) any objection Guarantor may now or hereafter have to the laying of venue in
any such Courts, (b) any claim that any action or proceeding brought in any of
such Courts has been brought in an inconvenient forum, and (c) any right to
bring any action or proceeding with respect to the Guaranteed Indebtedness or
this Guaranty in any forum other than the courts of the State of Texas located
in Xxxxxx County, Texas, or the United States District Court for the Southern
District of Texas.
22. Guarantor represents and warrants to Bank that the undersigned
is duly authorized and empowered to execute this Guaranty for and on behalf of
Guarantor and that this Guaranty is a valid, binding and enforceable obligation
of Guarantor and does not violate any provisions of its articles or certificate
of incorporation or its bylaws or any agreement creating and establishing
Guarantor as a legal entity and setting forth Guarantor's purposes or powers, as
applicable, or any law, rule, regulation, contract or agreement enforceable
against Guarantor.
EXECUTED this 21st day of October, 1997.
GUARANTOR:
EAGLE GEOPHYSICAL, INC.,
a Delaware corporation
By: /s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. XxXxxxx
Vice President and Chief Financial Officer
Address: Eagle Geophysical, Inc.
00 Xxxxx Xxxxxx Xxxx,
0xx Xxxxx Xxxx
Xxxxxxx, Xxxxx 00000
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