SUBSIDIARY GUARANTY
SUBSIDIARY
GUARANTY
1. Identification.
This
Guaranty (the “Guaranty”), dated as of __________, 2009, is entered into by Mesa
Energy, Inc., a Nevada corporation, Mesa Energy Operating, LLC, a Texas limited
liability company (each a “Guarantor” and collectively, “Guarantors”), for
the benefit of ____________________ (“Lender”).
2. Recitals.
2.1 Each
Guarantor is a direct subsidiary of Mesa Energy Holdings, Inc., a Delaware
corporation (“Parent”). The Lender has made and/or is making a loan
to Parent (the “Loan”). Guarantor has and will obtain substantial
benefit from the proceeds of the Loan.
2.2 The
Loan is and will be evidenced by a certain secured promissory Note issued by
Parent on or about the date of this Guaranty (“Note”) in the
principal amount of $__________ pursuant to a subscription agreement dated at or
about the date hereof (“Subscription Agreement”). The Note was
or will be executed by Parent as “Borrower” or “Debtor” for the benefit of
Lender as the “Holder” or “Lender” thereof.
2.3 In
consideration of the Loan and for other good and valuable consideration, and as
security for the performance by Parent of its obligations under the Note and as
security for the repayment of the Loan and all other sums due from Parent to
Lender arising under the Note, Transaction Documents (as defined in the
Subscription Agreement) and any other agreement to which the Lender and Parent
are parties (collectively, the “Obligations”), Guarantor, for good and valuable
consideration, receipt of which is acknowledged, has agreed to enter into this
Guaranty.
3. Guaranty.
3.1 Guaranty. Guarantor
hereby unconditionally and irrevocably guarantees, jointly and severally with
any other Guarantor, the punctual payment, performance and observance when due,
whether at stated maturity, by acceleration or otherwise, of all of the
Obligations now or hereafter existing, whether for principal, interest
(including, without limitation, all interest that accrues after the commencement
of any insolvency, bankruptcy or reorganization of Parent, whether or not
constituting an allowed claim in such proceeding), fees, commissions, expense
reimbursements, liquidated damages, indemnifications or otherwise (such
obligations, to the extent not paid by Parent being the parts of and components
of the “Obligations”), and agrees to pay any and all reasonable costs, fees and
expenses (including reasonable counsel fees and expenses) incurred by Lender in
enforcing any rights under the guaranty set forth herein. Without
limiting the generality of the foregoing, Guarantor’s liability shall extend to
all amounts that constitute part of the Obligations and would be owed by Parent
to Lender, but for the fact that they are unenforceable or not allowable due to
the existence of an insolvency, bankruptcy or reorganization involving
Parent.
3.2 Guaranty
Absolute. Guarantor guarantees that the Obligations will be
paid strictly in accordance with the terms of the Note, regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of Lender with respect thereto. The
obligations of Guarantor under this Guaranty are independent of the Obligations,
and a separate action or actions may be brought and prosecuted against Guarantor
to enforce such obligations, irrespective of whether any action is brought
against Parent or any other Guarantor or whether Parent or any other Guarantor
is joined in any such action or actions. The liability of Guarantor
under this Guaranty constitutes a primary obligation, and not a contract of
surety, and to the extent permitted by law, shall be irrevocable, absolute and
unconditional irrespective of, and Guarantor hereby irrevocably waives any
defenses it may now or hereafter have in any way relating to, any or all of the
following:
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(a) any
lack of validity of the Note or any agreement or instrument relating
thereto;
(b) any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Obligations, or any other amendment or waiver of or any consent to
departure from the Note, including, without limitation, any increase in the
Obligations resulting from the extension of additional credit to Parent or
otherwise;
(c) any
taking, exchange, release, subordination or non-perfection of any Collateral, or
any taking, release or amendment or waiver of or consent to departure from any
other guaranty, for all or any of the Obligations;
(d) any
change, restructuring or termination of the corporate, limited liability company
or partnership structure or existence of Parent; or
(e) any
other circumstance (including, without limitation, any statute of limitations)
or any existence of or reliance on any representation by Lender that might
otherwise constitute a defense available to, or a discharge of, Parent or any
other guarantor or surety.
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 Obligations is rescinded or must otherwise
be returned by Lender, the Lender or any other entity upon the insolvency,
bankruptcy or reorganization of the Parent or otherwise (and whether as a result
of any demand, settlement, litigation or otherwise), all as though such payment
had not been made.
3.3 Waiver. Guarantor
hereby waives promptness, diligence, notice of acceptance and any other notice
with respect to any of the Obligations and this Guaranty and any requirement
that Lender exhaust any right or take any action against any Borrower or any
other person or entity or any Collateral. Guarantor acknowledges that
it will receive direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section 3.3 is
knowingly made in contemplation of such benefits. Guarantor hereby
waives any right to revoke this Guaranty, and acknowledges that this Guaranty is
continuing in nature and applies to all Obligations, whether existing now or in
the future.
3.4 Continuing Guaranty;
Assignments. This Guaranty is a continuing guaranty and shall
(a) remain in full force and effect until the later of the indefeasible cash
payment in full of the Obligations and all other amounts payable under this
Guaranty, the Subscription Agreement, Transaction Documents and the Note, (b) be
binding upon Guarantor, its successors and assigns and (c) inure to the benefit
of and be enforceable by the Lender and its successors, pledgees, transferees
and assigns. Without limiting the generality of the foregoing
clause (c), Lender may pledge, assign or otherwise transfer all or any
portion of its rights and obligations under this Guaranty (including, without
limitation, all or any portion of its Note owing to it) to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted Lender herein or otherwise.
3.5 Subrogation. Guarantor
will not exercise any rights that it may now or hereafter acquire against Lender
or other Guarantor (if any) that arise from the existence, payment, performance
or enforcement of such Guarantor’s obligations under this Guaranty, including,
without limitation, any right of subrogation, reimbursement, exoneration,
contribution or indemnification, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law, including, without
limitation, the right to take or receive from Lender or other Guarantor (if
any), directly or indirectly, in cash or other property or by set-off or in any
other manner, payment or security solely on account of such claim, remedy or
right, unless and until all of the Obligations and all other amounts payable
under this Guaranty shall have been indefeasibly paid in full.
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3.6 Maximum Obligations.
Notwithstanding any provision herein contained to the contrary, Guarantor’s
liability with respect to the Obligations shall be limited to an amount not to
exceed, as of any date of determination, the amount that could be claimed by
Lender from Guarantor without rendering such claim voidable or avoidable under
Section 548 of the Bankruptcy Code or under any applicable state Uniform
Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or
common law.
4. Miscellaneous.
4.1 Expenses. Guarantor
shall pay to the Lender, on demand, the amount of any and all reasonable
expenses, including, without limitation, attorneys’ fees, legal expenses and
brokers’ fees, which the Lender may incur in connection with exercise or
enforcement of any the rights, remedies or powers of the Lender hereunder or
with respect to any or all of the Obligations.
4.2 Waivers, Amendment and
Remedies. No course of dealing by the Lender and no failure by
the Lender to exercise, or delay by the Lender in exercising, any right, remedy
or power hereunder shall operate as a waiver thereof, and no single or partial
exercise thereof shall preclude any other or further exercise thereof or the
exercise of any other right, remedy or power of the Lender. No
amendment, modification or waiver of any provision of this Guaranty and no
consent to any departure by Guarantor therefrom, shall, in any event, be
effective unless contained in a writing signed by the Majority in Interest (as
such term is defined in the Subscription Agreement) or the Lender against whom
such amendment, modification or waiver is sought, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. The rights, remedies and powers of the
Lender, not only hereunder, but also under any instruments and agreements
evidencing or securing the Obligations and under applicable law are cumulative,
and may be exercised by the Lender from time to time in such order as the Lender
may elect.
4.3 Notices. All
notices or other communications given or made hereunder shall be given in the
same manner as set forth in Section 13a of the Subscription Agreement to the
party to receive the same at its address set forth below or to such other
address as either party shall hereafter give to the other by notice duly made
under this Section:
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To
Guarantor, to:
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0000 Xxxxxx Xxxxxx Xxxx, Xxxxx
000
Xxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx, CEO
Fax: (760) ___________
With a copy by facsimile
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only
to:
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Gottbetter
& Partners, LLP
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000 Xxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxxxxxx,
Esq.
Fax: (000) 000-0000
To
Lender:
If to
Guarantor or Lender,
with a
copy by telecopier only to:
Grushko & Xxxxxxx,
P.C.
000 Xxxxx
Xxxxxx, Xxxxx 0000
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
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Any party
may change its address by written notice in accordance with this
paragraph.
4.4 Term; Binding
Effect. This Guaranty shall (a) remain in full force and
effect until payment and satisfaction in full of all of the Obligations; (b) be
binding upon Guarantor and its successors and permitted assigns; and (c) inure
to the benefit of the Lender and its respective successors and
assigns. Upon the payment in full of the Obligations, (i) this
Guaranty shall terminate and (ii) the Lender will, upon Guarantor’s request and
at Guarantor’s expense, execute and deliver to Guarantor such documents as
Guarantor shall reasonably request to evidence such termination, all without any
representation, warranty or recourse whatsoever.
4.5 Captions. The
captions of Paragraphs, Articles and Sections in this Guaranty have been
included for convenience of reference only, and shall not define or limit the
provisions hereof and have no legal or other significance
whatsoever.
4.6 Governing Law; Venue;
Severability. This Guaranty shall be governed by and construed
in accordance with the laws of the State of New York without regard to
principles of conflicts or choice of law. Any legal action or
proceeding against Guarantor with respect to this Guaranty must be brought only
in the courts of the State of New York or of the United States for the Southern
District of New York, and, by execution and delivery of this Guaranty, Guarantor
hereby irrevocably accepts for itself and in respect of its property, generally
and unconditionally, the jurisdiction of the aforesaid
courts. Guarantor hereby irrevocably waives any objection which they
may now or hereafter have to the laying of venue of any of the aforesaid actions
or proceedings arising out of or in connection with this Guaranty brought in the
aforesaid courts and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum. If any
provision of this Guaranty, or the application thereof to any person or
circumstance, is held invalid, such invalidity shall not affect any other
provisions which can be given effect without the invalid provision or
application, and to this end the provisions hereof shall be severable and the
remaining, valid provisions shall remain of full force and
effect. This
Guaranty shall be deemed an unconditional obligation of Guarantor for the
payment of money and, without limitation to any other remedies of Lender, may be
enforced against Guarantor by summary proceeding pursuant to New York Civil
Procedure Law and Rules Section 3213 or any similar rule or statute in the
jurisdiction where enforcement is sought. For purposes of such rule
or statute, any other document or agreement to which Lender and Guarantor are
parties or which Guarantor delivered to Lender, which may be convenient or
necessary to determine Lender’s rights hereunder or Guarantor’s obligations to
Lender are deemed a part of this Guaranty, whether or not such other document or
agreement was delivered together herewith or was executed apart from this
Guaranty. Each party hereby irrevocably waives personal
service of process and consents to process being served in any suit, action or
proceeding in connection with this Agreement or any other Transaction Document
by mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by law. Guarantor irrevocably appoints
Parent its true and lawful agent for service of process upon whom all processes
of law and notices may be served and given in the manner described above; and
such service and notice shall be deemed valid personal service and notice upon
each such Guarantor with the same force and validity as if served upon such
Guarantor.
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4.7 Satisfaction of
Obligations. For all purposes of this Guaranty, the payment in
full of the Obligations shall be conclusively deemed to have occurred when the
Obligations have been indefeasibly paid.
4.8 Execution. This
Agreement may be executed by facsimile signature and delivered by electronic
transmission.
[THE
BALANCE OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the
undersigned have executed and delivered this Guaranty, as of the date first
written above.
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“GUARANTOR”
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“GUARANTOR”
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MESA
ENERGY, INC.
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MESA
ENERGY OPERATING, LLC
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a
Nevada corporation
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a
Texas limited liability company
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By:
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By:
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Its:
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Its:
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APPROVED:
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“PARENT”
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A
Delaware corporation
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By:
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Its:
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This
Guaranty Agreement may be signed by facsimile signature and
delivered
by confirmed facsimile transmission.
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