GUARANTY
EXHIBIT 10.2
This
Guaranty (this “Agreement”)
dated
as of March 10, 2006 is made by Frontier Oil Corporation, a Wyoming corporation
(the “Guarantor”),
in
favor of Utexam Limited (“Utexam”).
Each
of the Parties may be referred to herein individually as a “Party”
and
collectively as the “Parties.”
RECITALS
1. This
Agreement is being executed and delivered in connection with that certain Master
Crude Oil Purchase and Sale Contract dated as of even date herewith (the
“Purchase
and Sale Contract”)
by and
among Utexam, as seller, and Frontier Oil & Refining Company, as purchaser
(the “Purchaser”).
2. The
Guarantor represents it is the parent company of the Purchaser.
3. The
Guarantor acknowledges that it will substantially benefit from the Purchase
and
Sale Contract.
4 To
induce
Utexam to enter into the Purchase and Sale Contract, the Purchaser desires
that
the Guarantor guarantee the Purchaser’s payment and performance under the
Purchase and Sale Contract.
5. The
Guarantor desires to guarantee the Purchaser’s payment and performance under the
Purchase and Sale Contract upon the terms and conditions set forth
herein.
AGREEMENT
For
and
in consideration of the premises and mutual covenants herein contained and
other
good and valuable consideration (the receipt and sufficiency of which is hereby
acknowledged), the Guarantor does hereby stipulate and agree as
follows:
1. The
Guaranty.
Subject
to the last sentence of this Section
1,
the
Guarantor hereby irrevocably and unconditionally guarantees to Utexam the full
and timely payment and performance and discharge by the Purchaser of all
obligations and liabilities of the Purchaser now existing or hereafter arising
under the Purchase and Sale Contract (the “Guaranteed
Obligations”)
and
hereby agrees that if the Purchaser shall fail timely to pay, perform and
discharge in full any obligation or liability in accordance with the terms
of
the Purchase and Sale Contract, the Guarantor shall be liable to Utexam for
such
obligation or liability, and, as such, if the Purchaser fails to pay, perform
and discharge any of the Guaranteed Obligations in accordance with the terms
of
the Purchase and Sale Contract, the Guarantor will, within three (3) days after
written notice of such failure to the Guarantor by Utexam, pay, perform and
discharge any such Guaranteed Obligation, as the case may be, as such payment,
performance and discharge is required to be made or done by the Purchaser
pursuant to the terms of the Purchase and Sale Contract. The guarantee in the
preceding sentence is an absolute, present and continuing guarantee of payment
and performance of obligations and not of collectibility and is in no way
conditional or contingent upon any attempt to collect from the Purchaser or
upon
any other action, occurrence or circumstance whatsoever. It shall not be
necessary for Utexam, in order to enforce such payment and performance by the
Guarantor, first to institute suit or exhaust its remedies against the Purchaser
or any other person liable with respect to any Guaranteed Obligations.
2. Obligations
Absolute.
The
obligations of the Guarantor to Utexam hereunder shall be absolute, continuing
and unconditional and shall not be released, discharged or in any way affected
by (except to the extent the Purchaser is so affected other than as set forth
in
(e) and (j) below), any of the following:
(a) any
amendment to, modification of, or supplement to the Purchase and Sale Contract
or any assignment or transfer of any rights or obligations
thereunder;
(b) any
release, consent or waiver, by operation of law or otherwise, of the payment,
performance or observance by the Purchaser or any other person of any express
or
implied agreement, covenant, term, obligation or condition under the Purchase
and Sale Contract;
(c) any
extension of the time for the payment of all or any portion of any sums payable
under the Purchase and Sale Contract or the extension of time for the payment
or
performance of any obligations under, arising out of or in connection with
the
Purchase and Sale Contract;
(d) any
failure, omission, delay or lack of diligence on the part of Utexam or any
other
person to enforce, assert or exercise, or any waiver of, any right, privilege,
power or remedy conferred on Utexam or any other person by the Purchase and
Sale
Contract, or any action on the part of Utexam or such other person granting
indulgence or extension of any kind;
(e) any
bankruptcy, insolvency, readjustment, composition, liquidation, dissolution
or
similar proceeding or any other defense that may arise in connection with any
such proceeding with respect to the Purchaser, the Guarantor or any other
person;
(f) any
change in the corporate or partnership structure, existence or ownership of
the
Guarantor, the Purchaser or Utexam, or any sale, lease or transfer of any or
all
of the assets of the Guarantor or the Purchaser to any person;
(g) any
failure on the part of the Purchaser for any reason to comply with or perform
any of the terms of any other agreement with the Guarantor;
(h) the
settlement or compromise of any Guaranteed Obligations;
(i) any
law,
regulation or order hereafter in effect in any jurisdiction affecting any of
the
rights under or terms of the Purchase and Sale Contract; or
(j) any
other
circumstance that might otherwise constitute a legal or equitable discharge
of
the Purchaser.
3. Waiver.
With
respect to Utexam, the Guarantor unconditionally waives, to the fullest extent
permitted by law: (a) notice of acceptance hereof, of any action taken or
omitted in reliance hereon, of demand, and of the defaults by the Purchaser
in
the payment or performance of any Guaranteed Obligations, and of any of the
matters referred to in Section
2;
(b) all
notices that may otherwise be required by statute, rule of law or otherwise
to
preserve any of the rights of Utexam against the Guarantor, including
presentment to or demand for payment from the Purchaser or the Guarantor, or
notice to the Purchaser of claims with a court in the event of the bankruptcy
of
the Purchaser; and (c) any requirement of diligence on the part of
Utexam.
4. Reinstatement
of Guaranty.
This
Agreement shall continue to be effective, or be reinstated, as the case may
be,
if and to the extent at any time any payment, in whole or in part, made by
the
Purchaser or the Guarantor to Utexam in respect of any Guaranteed Obligations
is rescinded or must otherwise be restored or returned by Utexam upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Purchaser, or upon or as a result of the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to the Purchaser
or
any substantial part of its property, or otherwise, all as though such payments
had not been made and, to the extent permitted by applicable law, in such event,
the Guarantor shall be liable to Utexam for an amount equal to the payment
that
has been rescinded or returned, and, as such, the Guarantor shall pay to Utexam
such amount equal to the payment that has been rescinded or returned within
three (3) days after written demand therefor has been made to the Guarantor
by
Utexam. Utexam shall not be required to litigate or otherwise dispute its
obligation to make such repayments if it in good faith believes that such
obligation exists and has so made such repayments.
5. Representations,
Covenants and Warranties of the Guarantor.
As of
the date hereof, the Guarantor represents, covenants and warrants that it is
Solvent (as defined below) and able to pay its respective debts as they mature,
and owns assets and property which in the aggregate have a fair value greater
than the amount required to pay its debts as they mature. “Solvent”
means
with respect to the Guarantor (a) the fair value of the property of the
Guarantor exceeds its total liabilities including, without limitation,
contingent liabilities, (b) the present fair saleable value of the assets of
the
Guarantor is not less than the amount that will be required to pay its probable
liability on its debts as they become absolute and matured, (c) the Guarantor
does not intend to, and does not believe that it will, incur debts or
liabilities beyond its ability to pay as such debts and liabilities mature
and
(d) the Guarantor is not engaged, and is not about to engage, in business or
a
transaction for which its property would constitute unreasonably small
capital.
6. Subordination.
The
Subordinated Debt (as defined below) is expressly subordinated to the full
and
final payment of the Guaranteed Obligations. The Guarantor may accept payment
of
Subordinated Debt so long as no default or circumstance that with the passage
of
time would result in a default exists, but the Guarantor agrees not to accept
any payment of any Subordinated Debt from the Purchaser if a default or
circumstance that with the passage of time would result in a default exists
under the Purchase and Sale Contract. If the Guarantor receives any payment
of
any Subordinated Debt in violation of the foregoing, the Guarantor shall hold
that payment in trust for Utexam and promptly turn it over to Utexam, in the
form received (with any necessary endorsements), to be applied to the Guaranteed
Obligations. “Subordinated
Debt”
means
all present and future payment obligations of the Purchaser to the Guarantor,
whether those obligations are (a) direct, indirect, fixed, contingent,
liquidated, unliquidated, joint, several, or joint and several, (b) due or
to
become due to the Guarantor, (c) held by or are to be held by the Guarantor,
(d)
created directly or acquired by assignment or otherwise, or (e) evidenced in
writing.
7. Subrogation
and Contribution.
Until
all
obligations under the Purchase and Sale Contract have expired or been canceled,
and the Guaranteed Obligations have been fully paid and performed (the
“Deferment
Date”)
(a)
the Guarantor may not assert, enforce, or otherwise exercise any right of
subrogation to any of the rights of Utexam or any other beneficiary against
the
Purchaser or any other obligor on the Guaranteed Obligations or any right of
recourse, reimbursement, subrogation, contribution, indemnification, or similar
right against the Purchaser or any other obligor on any Guaranteed Obligations
or any guarantor of it, and (b) the Guarantor defers all of the foregoing rights
(whether they arise in equity, under contract, by statute, under common law,
or
otherwise) until the Deferment Date.
6. Notices.
All
notices, requests, demands, claims, and other communications hereunder
("Notice") shall
be
in writing and shall be (i) delivered personally, (ii) mailed by registered
or
certified mail, postage prepaid and return receipt requested, (iii) by facsimile
or (iv) by electronic mail as set forth below:
If
to
the Guarantor: Frontier
Oil Corporation
00000
Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
XX 00000-0000
Attn:
Xxxx Xxxx, Vice President - Corporate Finance
Facsimile:
000-000-0000
Telephone:
000-000-0000
with
a
copy to: Frontier
Oil Corporation
00000
Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
XX 00000-0000
Attn:
Xxxxxx Xxxxxxx, General Counsel
Facsimile:
000-000-0000
Telephone:
000-000-0000
If
to
Utexam:
Utexam
Limited
5
George’s Dock
IFSC
Xxxxxx
0,
Xxxxxxx
Attn:
Xx.
Xxxxx Xxxxx
Attn:
Xx.
Xxxxx Xxxxxxxx
Facsimile:
000.0.000.00.00
Telephone:
000.0.000.00.00
with
a
copy to: BNP
Paribas
Energy
Commodities Export Project
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxx Xxx
Facsimile:
000-000-0000
Telephone:
000-000-0000
Notice
given by personal delivery or mail shall be effective upon actual receipt.
Notice given by telecopy or electronic mail shall be effective upon actual
receipt if received during the recipient's normal business hours, or at the
beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All Notices by facsimile or
electronic mail shall be confirmed promptly after transmission in writing by
certified mail or personal delivery. Any Party may change the address to which
Notices are to be delivered by giving the other Party notice in the manner
herein set forth.
7. Construction.
The
Parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by the Parties
and no presumption or burden of proof shall arise favoring or disfavoring any
Party by virtue of the authorship of any of the provisions of this Agreement.
Any reference to any federal, state, local, or foreign statute or law shall
be
deemed also to refer to all rules and regulations promulgated thereunder, unless
the context requires otherwise. The word “including” shall mean including
without limitation. All personal pronouns used in this Agreement, whether used
in the masculine, feminine or neuter gender, shall include all other genders;
the singular shall include the plural, and vice versa.
All
references herein to Exhibits, Schedules, Articles, Sections or subdivisions
thereof shall refer to the corresponding Exhibits, Schedules, Article, Section
or subdivision thereof of this Agreement unless specific reference is made
to
such exhibits, articles, sections or subdivisions of another document or
instrument. The terms “herein,” “hereby,” “hereunder,” “hereof,” “hereinafter,”
and other equivalent words refer to this Agreement in its entirety and not
solely to the particular portion of the Agreement in which such word is
used.
8. Severability.
Any
term or provision of this Agreement that is invalid or unenforceable in any
situation in any jurisdiction shall not affect the validity or enforceability
of
the remaining terms and provisions hereof or the validity or enforceability
of
the offending term or provision in any other situation or in any other
jurisdiction.
9. Entire
Agreement; Amendment.
THIS
AGREEMENT (INCLUDING THE DOCUMENTS REFERRED TO HEREIN) CONSTITUTES THE ENTIRE
AGREEMENT AMONG THE PARTIES AND SUPERSEDES ANY PRIOR UNDERSTANDINGS, AGREEMENTS,
OR REPRESENTATIONS BY OR AMONG THE PARTIES, WRITTEN OR ORAL, TO THE EXTENT
THEY
HAVE RELATED IN ANY WAY TO THE SUBJECT MATTER HEREOF. No amendment of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Guarantor and Utexam.
10. Term
of Agreement.
This
Agreement and all guarantees, covenants and agreements of the Guarantor
contained herein shall continue in full force and effect and shall not be
discharged until the earlier to occur of: (i) all of the Purchase and Sale
Contract shall have terminated or expired, or all of the Guaranteed Obligations
shall be indefeasibly paid in full in cash or otherwise performed and discharged
in full, or (ii) upon written consent of the Guarantor and
Utexam.
11. Survival
of Representations and Warranties.
All
representations and warranties contained herein or made in writing or on behalf
of the Guarantor in connection herewith shall survive the execution and delivery
of this Agreement.
12. Governing
Law.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT
OF
LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER
JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF NEW YORK.
13. Attorneys’
Fees.
In the
event of any litigation or other proceedings to enforce this Agreement, the
prevailing Party or Parties shall be entitled to recover all reasonable
attorneys’ fees and expenses incurred in connection therewith.
[Remainder
of page intentionally left blank]
IN
WITNESS WHEREOF, the Guarantor
has caused this Agreement to be duly executed and delivered as of the date
and
year first written in the preamble to this Agreement.
FRONTIER
OIL CORPORATION
By:
Xxxx
X.
Xxxx
Vice
President - Corporate Finance
ACKNOWLEDGED
AND ACCEPTED
UTEXAM
LIMITED
By:
Name:
Title:
By:
Name:
Title:
