Exhibit 4.6
GUARANTY
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THIS GUARANTY (this "Guaranty") is dated as of the ____ day of
__________________, _____, by XXXXXXX PETROLEUM CORPORATION, formerly known as
Xxxxxxx Petroleum Holdings, Inc., a Delaware corporation ("Guarantor"), in favor
of BANK ONE, NA, with its main office in Chicago, Illinois, and each of the
other financial institutions listed on Schedule 1.1 to the Credit Agreement (as
hereinafter defined) as Banks, and each of their successors and assigns as
permitted pursuant to the Credit Agreement (Bank One, NA, acting as a Bank but
not as Administrative Agent, and each of the other Banks listed on Schedule 1.1
of the Credit Agreement, and each of their successors and assigns are
collectively referred to herein as "Noteholders").
W I T N E S S E T H:
WHEREAS, Xxxxxxx Oil and Gas Corporation, formerly known as Xxxxxxx
Petroleum Corporation, a Delaware corporation ("Borrower"), Noteholders, Bank
One, NA, with its main office in Chicago, Illinois, as Administrative Agent
("Administrative Agent") and the other agents a party to the Credit Agreement
are parties to that certain Credit Agreement (as amended by that certain First
Amendment to Credit Agreement dated as of January 7, 2003, that certain Second
Amendment to Credit Agreement dated as of June ____, 2003, that certain Third
Amendment to Credit Agreement dated as of October ___, 2003 [the "Third
Amendment"], and as otherwise amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement") dated as of December 20,
2002, pursuant to which Noteholders have made a revolving credit loan to
Borrower and agreed to issue and participate in letters of credit issued on
behalf of Borrower (unless otherwise defined herein, all terms used herein with
their initial letter capitalized shall have the meaning given such terms in the
Credit Agreement); and
WHEREAS, pursuant to the terms of the Third Amendment, Guarantor is
obligated to execute and deliver this Guaranty; and
WHEREAS, Guarantor has determined that valuable benefits will be derived by
it as a result of the Credit Agreement and the extension of credit made (and to
be made) by Noteholders thereunder; and
WHEREAS, Guarantor has further determined that the benefits accruing to it
from the Credit Agreement exceed Guarantor's anticipated liability under this
Guaranty.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged and confessed, Guarantor hereby covenants and
agrees as follows:
1. Guarantor hereby absolutely and unconditionally guarantees the prompt,
complete and full payment when due, no matter how such shall become due, of the
Obligations, and further guarantees that Borrower will properly and timely
perform the Obligations. Notwithstanding any contrary provision in this
Guaranty, however, Guarantor's maximum liability under this Guaranty is limited,
to the extent, if any, required so that its liability is not
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subject to avoidance under applicable Debtor Relief Laws (as such term is
defined in Paragraph 8 hereof).
2. If Guarantor is or becomes liable for any indebtedness owing by Borrower
to any Noteholder by endorsement or otherwise than under this Guaranty, such
liability shall not be in any manner impaired or affected hereby, and the rights
of Noteholders hereunder shall be cumulative of any and all other rights that
Noteholders may ever have against Guarantor, it being understood that the
foregoing does not extend the liability of Guarantor under this Guaranty beyond
the liability of Guarantor as set forth in Paragraph 1 hereof. The exercise by
any Noteholder of any right or remedy hereunder or under any other instrument,
at law or in equity, shall not preclude the concurrent or subsequent exercise of
any other right or remedy.
3. In the event of default by Borrower in payment of the Obligations, or
any part thereof, when such Obligations become due, either by their terms or as
the result of the exercise of any power to accelerate, Guarantor shall, on
demand, and without further notice of dishonor and without any notice having
been given to Guarantor previous to such demand of the acceptance by Noteholders
of this Guaranty, and without any notice having been given to such Guarantor
previous to such demand of the creating or incurring of such Obligations, pay
the amount due thereon to Noteholders at Administrative Agent's office as set
forth in the Credit Agreement, and it shall not be necessary for any Noteholder,
in order to enforce such payment by Guarantor, first, to institute suit or
exhaust its remedies against Borrower or others liable on such Obligations, to
have Borrower joined with Guarantor in any suit brought under this Guaranty or
to enforce their rights against any security which shall ever have been given to
secure such indebtedness; provided, however, that in the event any Noteholder
elects to enforce and/or exercise any remedies they may possess with respect to
any security for the Obligations prior to demanding payment from Guarantor,
Guarantor shall nevertheless be obligated hereunder for any and all sums still
owing to Noteholders on the Obligations and not repaid or recovered incident to
the exercise of such remedies.
4. Notice to Guarantor of the acceptance of this Guaranty and of the
making, renewing or assignment of the Obligations and each item thereof, are
hereby expressly waived by Guarantor.
5. Each payment on the Obligations shall be deemed to have been made by
Borrower unless express written notice is given to Noteholders at the time of
such payment that such payment is made by Guarantor as specified in such notice.
6. If all or any part of the Obligations at any time are secured, Guarantor
agrees that Administrative Agent and/or Noteholders may at any time and from
time to time, at their discretion and with or without valuable consideration,
allow substitution or withdrawal of collateral or other security and release
collateral or other security or compromise or settle any amount due or owing
under the Credit Agreement or amend or modify in whole or in part the Credit
Agreement or any Loan Paper executed in connection with same without impairing
or diminishing the obligations of Guarantor hereunder. Guarantor further agrees
that if Borrower executes in favor of any Noteholder any collateral agreement,
mortgage or other security instrument, the exercise by any Noteholder of any
right or remedy thereby conferred on such Noteholder shall be wholly
discretionary with such Noteholder, and that the exercise or failure to
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exercise any such right or remedy shall in no way impair or diminish the
obligation of Guarantor hereunder. Guarantor further agrees that Noteholders and
Administrative Agent shall not be liable for their failure to use diligence in
the collection of the Obligations or in preserving the liability of any Person
liable for the Obligations, and Guarantor hereby waives presentment for payment,
notice of nonpayment, protest and notice thereof (including, notice of
acceleration), and diligence in bringing suits against any Person liable on the
Obligations, or any part thereof.
7. Guarantor agrees that Noteholders, in their discretion, may (a) bring
suit against all guarantors (including, without limitation, Guarantor hereunder)
of the Obligations jointly and severally or against any one or more of them, (b)
compound or settle with any one or more of such guarantors for such
consideration as Noteholders may deem proper, and (c) release one or more of
such guarantors from liability hereunder, and that no such action shall impair
the rights of Noteholders to collect the Obligations (or the unpaid balance
thereof) from other such guarantors of the Obligations, or any of them, not so
sued, settled with or released. Guarantor agrees, however, that nothing
contained in this paragraph, and no action by Noteholders permitted under this
paragraph, shall in any way affect or impair the rights or obligations of such
guarantors among themselves.
8. Guarantor represents and warrants to each Noteholder that (a) Guarantor
is a corporation duly incorporated and validly existing under the laws of the
State of Delaware; (b) Guarantor possesses all requisite authority and power to
authorize, execute, deliver and comply with the terms of this Guaranty; (c) this
Guaranty has been duly authorized and approved by all necessary action on the
part of Guarantor and constitutes a valid and binding obligation of Guarantor
enforceable in accordance with its terms, except as (1) the enforcement thereof
may be limited by applicable Debtor Relief Laws, and (2) the availability of
equitable remedies may be limited by equitable principles of general
applicability; and (d) no approval or consent of any court or governmental
entity is required for the authorization, execution, delivery or compliance with
this Guaranty which has not been obtained (and copies thereof delivered to
Noteholders). As used in this Guaranty, the term "Debtor Relief Laws" means the
Bankruptcy Code of the United States of America and all other applicable
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension of payments or similar
debtor relief laws from time to time in effect affecting the rights of creditors
generally.
9. Guarantor covenants and agrees that until the Obligations are paid and
performed in full, except as otherwise provided in the Credit Agreement or
unless Noteholders give their prior written consent to any deviation therefrom,
it will (a) at all times maintain its existence and authority to transact
business in any state or jurisdiction where Guarantor has assets and operations,
except where the failure to maintain such existence or authority would not have
a Material Adverse Effect, (b) promptly deliver to Noteholders and to
Administrative Agent such information respecting its business affairs, assets
and liabilities as Noteholders may reasonably request, and (c) duly and
punctually observe and perform all covenants applicable to Guarantor under the
Credit Agreement and the other Loan Papers. The failure of Guarantor to comply
with the terms of this paragraph shall be an Event of Default under the Credit
Agreement.
10. This Guaranty is for the benefit of Noteholders, their successors and
assigns, and in the event of an assignment by Noteholders (or their successors
or assigns) of the Obligations, or any part thereof, the rights and benefits
hereunder, to the extent applicable to the Obligations
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so assigned, may be transferred with such Obligations. This Guaranty is binding
upon Guarantor and its successors and assigns.
11. No modification, consent, amendment or waiver of any provision of this
Guaranty, nor consent to any departure by Guarantor therefrom, shall be
effective unless the same shall be in writing and signed by each Noteholder, and
then shall be effective only in the specific instance and for the purpose for
which given. No notice to or demand on Guarantor in any case shall, of itself,
entitle Guarantor to any other or further notice or demand in similar or other
circumstances. No delay or omission by Noteholders in exercising any power or
right hereunder shall impair any such right or power or be construed as a waiver
thereof or any acquiescence therein, nor shall any single or partial exercise of
any such power preclude other or further exercise thereof, or the exercise of
any other right or power hereunder. All rights and remedies of Noteholders
hereunder are cumulative of each other and of every other right or remedy which
Noteholders may otherwise have at law or in equity or under any other contract
or document, and the exercise of one or more rights or remedies shall not
prejudice or impair the concurrent or subsequent exercise of other rights or
remedies.
12. No provision herein or in any promissory note, instrument or any other
Loan Paper executed by Borrower or Guarantor evidencing the Obligations shall
require the payment or permit the collection of interest in excess of the
Maximum Lawful Rate. If any excess of interest in such respect is provided for
herein or in any such promissory note, instrument, or any other Loan Paper, the
provisions of this paragraph shall govern, and neither Borrower nor Guarantor
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the amount permitted by law. The intention of the parties being to
conform strictly to any applicable federal or state usury laws now in force, all
promissory notes, instruments and other Loan Papers executed by Borrower or
Guarantor evidencing the Obligations shall be held subject to reduction to the
amount allowed under said usury laws as now or hereafter construed by the courts
having jurisdiction.
13. If Guarantor should breach or fail to perform any provision of this
Guaranty, Guarantor agrees to pay Noteholders all costs and expenses (including
court costs and reasonable attorneys fees) incurred by Noteholders in the
enforcement hereof.
14. (a) The liability of Guarantor under this Guaranty shall in no manner
be impaired, affected or released by the insolvency, bankruptcy, making of an
assignment for the benefit of creditors, arrangement, compensation, composition
or readjustment of Borrower, or any proceedings affecting the status, existence
or assets of Borrower or other similar proceedings instituted by or against
Borrower and affecting the assets of Borrower.
(b) Guarantor acknowledges and agrees that any interest on any portion
of the Obligations which accrues after the commencement of any proceeding
referred to in clause (a) of this Paragraph 14 above (or, if interest on any
portion of the Obligations ceases to accrue by operation of law by reason of the
commencement of said proceeding, such interest as would have accrued on such
portion of the Obligations if said proceedings had not been commenced) shall be
included in the Obligations because it is the intention of Guarantor,
Administrative Agent and Noteholders that the Obligations which are guaranteed
by Guarantor pursuant to this Guaranty should be determined without regard to
any rule of law or order which may relieve Borrower of
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any portion of such Obligations. Guarantor will permit any trustee in
bankruptcy, receiver, debtor in possession, assignee for the benefit of
creditors or similar Person to pay Noteholders or Administrative Agent, or allow
the claim of Noteholders or Administrative Agent in respect of, any such
interest accruing after the date on which such proceeding is commenced.
(c) In the event that all or any portion of the Obligations are paid
by Borrower, the obligations of Guarantor hereunder shall continue and remain in
full force and effect or be reinstated, as the case may be, in the event that
all or any part of such payment(s) are rescinded or recovered directly or
indirectly from Administrative Agent or any Noteholder as a preference,
fraudulent transfer or otherwise, and any such payments which are so rescinded
or recovered shall constitute Obligations for all purposes under this Guaranty.
15. Guarantor understands and agrees that any amounts of Guarantor on
account with any Noteholder may, after the occurrence and during the continuance
of an Event of Default, be offset to satisfy the obligations of Guarantor
hereunder.
16. Guarantor hereby subordinates and makes inferior any and all
indebtedness now or at any time hereafter owed by Borrower to Guarantor to the
Obligations evidenced by the Credit Agreement and agrees after the occurrence
and during the continuance of a Default or an Event of Default under the Credit
Agreement, or any event which with notice, lapse of time, or both, would
constitute a Default under the Credit Agreement, not to permit Borrower to
repay, or to accept payment from Borrower of, such indebtedness or any part
thereof without the prior written consent of Noteholders.
17. During the period that Banks have any commitment to lend or participate
in Letter of Credit Exposure under the Loan Papers, or any amount payable under
any Note remains unpaid or any Letter of Credit remains outstanding, and
throughout any additional preferential period subsequent thereto, Guarantor
hereby waives any and all rights of subrogation to which Guarantor may otherwise
be entitled against Borrower, or any other guarantor of the Obligations, as a
result of any payment made by Guarantor pursuant to this Guaranty.
18. As of the date hereof, the fair saleable value of the property of
Guarantor is greater than the total amount of liabilities (including contingent
and unliquidated liabilities) of Guarantor, and Guarantor is able to pay all of
its liabilities as such liabilities mature and Guarantor does not have
unreasonably small capital within the meaning of Xxxxxxx 000, Xxxxx 00, Xxxxxx
Xxxxxx Code, as amended. In computing the amount of contingent or liquidated
liabilities, such liabilities have been computed at the amount which, in light
of all the facts and circumstances existing as of the date hereof, represents
the amount that can reasonably be expected to become an actual or matured
liability.
19. If any provision of this Guaranty is held to be illegal, invalid, or
unenforceable, such provision shall be fully severable, this Guaranty shall be
construed and enforced as if such illegal, invalid, or unenforceable provision
had never comprised a part hereof, and the remaining provisions hereof shall
remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance herefrom. Furthermore,
in lieu of such illegal, invalid, or unenforceable provision there shall be
added automatically as a part of this
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Guaranty a provision as similar in terms to such illegal, invalid, or
unenforceable provision as may be possible and be legal, valid and enforceable.
20. (a) Except to the extent required for the exercise of the remedies
provided in the other security instruments, Guarantor hereby irrevocably submits
to the nonexclusive jurisdiction of any Texas state or federal court over any
action or proceeding arising out of or relating to this Guaranty or any other
Loan Paper, and Guarantor hereby irrevocably agrees that all claims in respect
of such action or proceeding may be heard and determined in such Texas state or
federal court. Guarantor hereby irrevocably waives, to the fullest extent
permitted by Law, any objection which it may now or hereafter have to the laying
of venue of any Litigation arising out of or in connection with this Guaranty or
any of the Loan Papers brought in district courts of Dallas County, Texas, or in
the United States District Court for the Northern District of Texas, Dallas
Division. Guarantor hereby irrevocably waives any claim that any Litigation
brought in any such court has been brought in an inconvenient forum. Guarantor
hereby irrevocably consents to the service of process out of any of the
aforementioned courts in any such Litigation by the delivery of copies thereof
by Federal Express or other nationally recognized overnight delivery service, to
Guarantor's office at 0000 Xxxxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000-0000,
Attn: Xxxxx X. Xxxxxx, with a copy to Xxxxx & Lardner, 000 Xxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, Attn: Emory Ireland. Guarantor irrevocably
agrees that any legal proceeding against Noteholders shall be brought in the
district courts of Dallas County, Texas, or in the United States District Court
for the Northern District of Texas, Dallas Division. Nothing herein shall affect
the right of Noteholder to commence legal proceedings or otherwise proceed
against Guarantor in any jurisdiction or to serve process in any manner
permitted by applicable law. As used herein, the term "Litigation" means any
proceeding, claim, lawsuit or investigation (1) conducted or threatened by or
before any court or governmental department, commission, board, bureau, agency
or instrumentality of the United States or of any state, commonwealth, nation,
territory, possession, county, parish, or municipality, whether now or hereafter
constituted or existing, or (2) pending before any public or private arbitration
board or panel.
(b) Nothing in this Paragraph 20 shall affect any right of any
Noteholder to serve legal process in any other manner permitted by law or affect
the right of any Noteholder to bring any action or proceeding against Guarantor
in the courts of any other jurisdictions.
(c) To the extent that Guarantor has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property,
Guarantor hereby irrevocably waives such immunity in respect of its obligations
under this Guaranty and the other Loan Papers.
21. THIS GUARANTY AND THE OTHER LOAN PAPERS COLLECTIVELY REPRESENT THE
FINAL AGREEMENT BY AND AMONG NOTEHOLDERS, ADMINISTRATIVE AGENT AND GUARANTOR AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF NOTEHOLDERS, AGENT AND GUARANTOR. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG NOTEHOLDERS, ADMINISTRATIVE AGENT AND GUARANTOR.
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22. GUARANTOR, FOR ITSELF, ITS SUCCESSORS AND ASSIGNS, HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ITS RIGHT TO A JURY TRIAL, IN
ANY LITIGATION ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTY OR ANY OF THE
OTHER LOAN PAPERS.
23. THIS GUARANTY AND THE OTHER LOAN PAPERS SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS.
EXECUTED and effective as of the date first above written.
GUARANTOR:
XXXXXXX PETROLEUM CORPORATION, a
Delaware corporation
By: ____________________________
Name: __________________________
Title: _________________________
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