Exhibit 4.2
UNCONDITIONAL GUARANTY
THIS UNCONDITIONAL GUARANTY ("GUARANTY") is made as of the 11th day of
September, 1997, by Guarantor (as hereinafter defined) for the benefit of Bank
(as hereinafter defined).
1. DEFINITIONS. As used in this Guaranty, the following terms shall have
the meanings indicated below:
(a) The term "BANK" shall mean BANK ONE, TEXAS, NATIONAL ASSOCIATION,
the address of Bank for notice purposes is the following:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
(b) The term "BORROWER" (whether one or more) shall mean the
following:
Western Pacific Airlines, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(c) The term "GUARANTOR" shall mean ▇▇▇▇ Petroleum Corporation, whose
address for notice purposes is the following:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(d) The term "GUARANTEED INDEBTEDNESS" shall mean (i) all
indebtedness, obligations and liabilities of Borrower to Bank of any kind
or character now existing or hereafter arising, whether direct, indirect,
related, unrelated, fixed, contingent, liquidated, unliquidated, joint,
several or joint and several, created pursuant to that certain Note of even
date herewith by and between Bank and Borrower in the face amount of
$10,000,000 (the "Note"), (ii) all accrued but unpaid interest on any of
the indebtedness described in (i) above, (iii) all obligations of Borrower
to Bank under any documents evidencing, securing, governing and/or
pertaining to all or any part of the indebtedness described in (i) and (ii)
above, (iv) all costs and expenses incurred by Bank in connection with the
collection and administration of all or any part of the indebtedness and
obligations described in (i), (ii) and (iii) above or the protection or
preservation of, or realization upon, the collateral securing all or any
part of such indebtedness and obligations, including without limitation all
reasonable attorneys' fees, and (vi) all
renewals, extensions, modifications and rearrangements of the indebtedness
and obligations described in (i), (ii), (iii), (iv) and (v) above.
2. OBLIGATIONS. As an inducement to Bank to extend or continue to extend
credit and other financial accommodations to Borrower, Guarantor, for value
received, does hereby unconditionally and absolutely guarantee the prompt and
full payment and performance of the Guaranteed Indebtedness when due or declared
to be due and at all times thereafter. The liability of Guarantor hereunder
with respect to the Guaranteed Indebtedness shall be limited to the maximum
amount of liability that can be incurred without rendering this Guaranty, as it
relates to the Guarantor, voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer, and not for any greater amount.
3. CHARACTER OF OBLIGATIONS. This is an absolute, continuing and
unconditional Guaranty of payment and not of collection and if at any time or
from time to time there is no outstanding Guaranteed Indebtedness, the
obligations of the Guarantor with respect to any and all Guaranteed Indebtedness
of Borrower to Bank incurred thereafter shall not be affected. All Guaranteed
Indebtedness heretofore, concurrently herewith or hereafter made by Bank to
Borrower shall be conclusively presumed to have been made or acquired in
acceptance hereof. Guarantor shall be primarily liable, jointly and severally,
with Borrower and any other guarantor of all or any part of the Guaranteed
Indebtedness.
4. REPRESENTATIONS AND WARRANTIES. Guarantor hereby represents and
warrants the following to Bank:
(a) This Guaranty may reasonably be expected to benefit, directly or
indirectly, Guarantor, and (i) if Guarantor is a corporation, the Board of
Directors of Guarantor has determined that this Guaranty may reasonably be
expected to benefit, directly or indirectly, Guarantor, or (ii) if
Guarantor is a partnership, the requisite number of Guarantor's partners
have determined that this Guaranty may reasonably be expected to benefit,
directly or indirectly, Guarantor;
(b) 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 security
for the payment of all or any part of the Guaranteed Indebtedness;
provided, however, Guarantor is not relying on such financial condition or
collateral as an inducement to enter into this Guaranty;
(c) Guarantor has adequate means to obtain from Borrower on a
continuing basis information concerning the financial condition of Borrower
and Guarantor is not relying on Bank to provide such information to
Guarantor either now or in the future;
(d) Guarantor has the power and authority to execute, deliver and
perform this Guaranty and any other agreements executed by Guarantor
contemporaneously herewith,
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and the execution, delivery and performance of this Guaranty and any other
agreements executed by Guarantor contemporaneously herewith does not and
will not violate (i) any agreement or instrument to which Guarantor is a
party, (ii) any law, rule, regulation or order of any governmental
authority to which Guarantor is subject, or (iii) Guarantor's Articles of
Incorporation or Bylaws if Guarantor is a corporation, or Guarantor's
Partnership Agreement if Guarantor is a partnership;
(e) Neither Bank nor any other party has made any representation,
warranty or statement to Guarantor in order to induce Guarantor to execute
this Guaranty;
(f) The financial statements and other financial information
regarding Guarantor heretofore and hereafter delivered to Bank are and
shall be true and correct in all material respects and fairly present the
financial position of Guarantor as of the dates thereof, and no material
adverse change has occurred in the financial condition of Guarantor
reflected in the financial statements and other financial information
regarding Guarantor heretofore delivered to Bank since the date of the last
statement thereof; and
(g) As of the date hereof, and after giving effect to this Guaranty
and the obligations evidenced hereby, (i) Guarantor is and will be solvent,
(ii) the fair saleable value of Guarantor's assets exceeds and will
continue to exceed Guarantor's liabilities (both fixed and contingent),
(iii) Guarantor is and will continue to be able to pay Guarantor's debts as
they mature, and (iv) if Guarantor is not an individual, Guarantor has and
will continue to have sufficient capital to carry on its business and all
businesses in which it is about to engage.
5. COVENANTS. Guarantor hereby covenants and agrees with Bank as
follows:
(a) Guarantor shall not, so long as Guarantor's obligations under
this Guaranty continue, transfer or pledge any material portion of
Guarantor's assets for less than full and adequate consideration;
(b) Guarantor shall promptly furnish to Bank at any time and from
time to time such financial statements and other financial information of
Guarantor as the Bank may require, in form and substance satisfactory to
Bank;
(c) Guarantor shall comply with all terms and provisions of the
instruments and agreements evidencing, governing and securing all or any
part of the Guaranteed Indebtedness that apply to Guarantor; and
(d) Guarantor shall promptly inform Bank of (i) any litigation or
governmental investigation against Guarantor or affecting any security for
all or any part of the Guaranteed Indebtedness or this Guaranty which, if
determined adversely, might have a material adverse effect upon the
financial condition of Guarantor or upon such
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security or might cause a default under any of the instruments or
agreements evidencing, governing or securing all or any part of the
Guaranteed Indebtedness, (ii) any claim or controversy which might become
the subject of such litigation or governmental investigation, and (iii) any
material adverse change in the financial condition of Guarantor.
6. CONSENT AND WAIVER.
(a) Guarantor waives (i) promptness, diligence and notice of
acceptance of this Guaranty and notice of the incurring of any obligation,
indebtedness or liability to which this Guaranty applies or may apply and
waives presentment for payment, notice of nonpayment, protest, demand,
notice of protest, notice of intent to accelerate, notice of acceleration,
notice of dishonor, diligence in enforcement and indulgences of every kind,
and (ii) the taking of any other action of Bank, including without
limitation giving any notice of default or any other notice to, or making
any demand on, Borrower, any other guarantor of all or any part of the
Guaranteed Indebtedness or any other party.
(b) Guarantor waives any rights Guarantor has under, or any
requirements imposed by, Chapter 34 of the Texas Business and Commerce
Code, as in effect on the date of this Guaranty or as it may be amended
from time to time.
(c) Bank may at any time, without the consent of or notice to
Guarantor, without incurring responsibility to Guarantor and without
impairing, releasing, reducing or affecting the obligations of Guarantor
hereunder: (i) change the manner, place or terms of payment of all or any
part of the Guaranteed Indebtedness, or renew, extend, modify, rearrange or
alter all or any part of the Guaranteed Indebtedness; (ii) sell, exchange,
release, surrender, subordinate, realize upon or otherwise deal with in any
manner and in any order any collateral for all or any part of the
Guaranteed Indebtedness or this Guaranty or setoff against all or any part
of the Guaranteed Indebtedness; (iii) neglect, delay, omit, fail or refuse
to take or prosecute any action for the collection of all or any part of
the Guaranteed Indebtedness or this Guaranty or to take or prosecute any
action in connection with any instrument or agreement evidencing, governing
or securing all or any part of the Guaranteed Indebtedness or this
Guaranty; (iv) exercise or refrain from exercising any rights against
Borrower or others, or otherwise act or refrain from acting; (v) settle or
compromise all or any part of the Guaranteed Indebtedness and subordinate
the payment of all or any part of the Guaranteed Indebtedness to the
payment of any obligations, indebtedness or liabilities which may be due or
become due to Bank or others; (vi) apply any deposit balance, fund,
payment, collections through process of law or otherwise or other
collateral of Borrower to the satisfaction and liquidation of the
indebtedness or obligations of Borrower to Bank not guaranteed under this
Guaranty pursuant to paragraph 4 herein; and (vii) apply any sums paid to
Bank by Guarantor, Borrower or others to the Guaranteed Indebtedness in
such order and manner as Bank, in its sole discretion, may determine.
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(d) Notwithstanding any provision in this Guaranty to the contrary,
Guarantor hereby waives and releases, until such time as the Guaranteed
Indebtedness has been paid in full, (i) any and all rights of subrogation
against Borrower and (ii) any and all rights to be subrogated to the rights
of Bank in any collateral or security for all or any part of the Guaranteed
Indebtedness.
(e) Should Bank seek to enforce the obligations of Guarantor
hereunder by action in any court or otherwise, Guarantor waives any
requirement, substantive or procedural, that (i) Bank first enforce any
rights or remedies against Borrower or any other person or entity liable to
Bank for all or any part of the Guaranteed Indebtedness, including without
limitation that a judgment first be rendered against Borrower or any other
person or entity, or that Borrower or any other person or entity should be
joined in such cause, or (ii) Bank shall first enforce rights against any
collateral which shall ever have been given to secure all or any part of
the Guaranteed Indebtedness or this Guaranty. Such waiver shall be without
prejudice to Bank's right, at its option, to proceed against Borrower or
any other person or entity, whether by separate action or by joinder.
(f) In addition to any other waivers, agreements and covenants of
Guarantor set forth herein, Guarantor hereby further waives and releases
all claims, causes of action, defenses and offsets for any act or omission
of Bank, its directors, officers, employees, representatives or agents in
connection with Bank's administration of the Guaranteed Indebtedness,
except for Bank's willful misconduct and gross negligence.
7. OBLIGATIONS NOT IMPAIRED.
(a) Guarantor agrees that Guarantor's obligations hereunder shall not
be released, diminished, impaired, reduced or affected by the occurrence of
any one or more of the following events: (i) the death, disability or lack
of corporate power of Borrower, Guarantor (except as provided in paragraph
10 herein) or any other guarantor of all or any part of the Guaranteed
Indebtedness, (ii) any receivership, insolvency, bankruptcy or other
proceedings affecting Borrower, Guarantor or any other guarantor of all or
any part of the Guaranteed Indebtedness, or any of their respective
property; (iii) the partial or total release or discharge of Borrower or
any other guarantor of all or any part of the Guaranteed Indebtedness, or
any other person or entity from the performance of any obligation contained
in any instrument or agreement evidencing, governing or securing all or any
part of the Guaranteed Indebtedness, whether occurring by reason of law or
otherwise; (iv) the taking or accepting of any collateral for all or any
part of the Guaranteed Indebtedness or this Guaranty; (v) the taking or
accepting of any other guaranty for all or any part of the Guaranteed
Indebtedness; (vi) any failure by Bank to acquire, perfect or continue any
lien or security interest on collateral securing all or any part of the
Guaranteed Indebtedness or this Guaranty; (vii) the impairment of any
collateral securing all or any part of the Guaranteed Indebtedness or this
Guaranty; (viii) any failure by Bank to sell any collateral securing all or
any part of the Guaranteed
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Indebtedness or this Guaranty in a commercially reasonable manner or as
otherwise required by law; (ix) any invalidity or unenforceability of or
defect or deficiency in any instrument or agreement evidencing, governing
or securing all or any part of the Guaranteed Indebtedness or this
Guaranty; or (x) any other circumstances which might otherwise constitute a
defense available to, or discharge of, Borrower or any other guarantor of
all or any part of the Guaranteed Indebtedness.
(b) This Guaranty shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of all or any part of the
Guaranteed Indebtedness is rescinded or must otherwise be returned by Bank
upon the insolvency, bankruptcy or reorganization of Borrower, Guarantor,
any other guarantor of all or any part of the Guaranteed Indebtedness, or
otherwise, all as though such payment had not been made.
(c) In the event Borrower is a corporation, joint stock association
or partnership, or is hereafter incorporated, none of the following shall
affect Guarantor's liability hereunder: (i) the unenforceability of all or
any part of the Guaranteed Indebtedness against Borrower by reason of the
fact that the Guaranteed Indebtedness exceeds the amount permitted by law;
(ii) the act of creating all or any part of the Guaranteed Indebtedness is
ultra ▇▇▇▇▇; or (iii) the officers or partners creating all or any part of
the Guaranteed Indebtedness acted in excess of their authority. Guarantor
hereby acknowledges that withdrawal from, or termination of, any ownership
interest in Borrower now or hereafter owned or held by Guarantor shall not
alter, affect or in any way limit the obligations of Guarantor hereunder.
(d) Upon receipt by Bank of full and final payment of all obligations
of Borrower under the Note and/or all obligations of Guarantor under this
Guaranty, the Guarantor shall be released from all obligations hereunder.
8. ACTIONS AGAINST GUARANTOR. In the event of a default in the payment
or performance of all or any part of the Guaranteed Indebtedness when such
Guaranteed Indebtedness becomes due, whether by its terms, by acceleration or
otherwise or in the event of the occurrence of an Insolvency Event (as
hereinafter defined), Guarantor shall, without notice or demand, promptly
either, at the sole election of the Bank, (i) pay the amount due thereon to
Bank, in lawful money of the United States, at Bank's address set forth
hereinabove or (ii) purchase the Note from the Bank at an amount equal to the
then outstanding principal, plus all accrued but unpaid interest and fees. One
or more successive or concurrent actions may be brought against Guarantor,
either in the same action in which Borrower is sued or in separate actions, as
often as Bank deems advisable. The exercise by Bank of any right or remedy
under this Guaranty or under any other agreement or instrument, at law, in
equity or otherwise, shall not preclude concurrent or subsequent exercise of any
other right or remedy. The books and records of Bank shall be admissible in
evidence in any action or proceeding involving this Guaranty and shall be PRIMA
FACIE evidence of the payments made on, and the outstanding balance of, the
Guaranteed Indebtedness. The term "Insolvency Event" is used herein to mean (i)
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the commencement of either voluntary or involuntary proceedings brought by or
against Borrower seeking the liquidation, reorganization or other relief with
respect to itself or its assets under any bankruptcy, insolvency or similar law
now or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator or custodian or other similar official of all of its or a substantial
portion of its assets or properties, or (ii) the consent by Borrower to any such
relief or to the appointment or taking possession of such official in an
involuntary case or other proceeding commenced against it, or (iii) the general
assignment by Borrower for the benefit of creditors or Borrower shall fail
generally to pay its debts as they become due, or (iv) the taking by Borrower of
any corporate action authorizing any of the foregoing. It is the intent of the
parties hereto that upon the occurrence of an Insolvency Event, no notice or
demand whatsoever shall be required to be given Borrower or Guarantor prior to
the effectiveness of this paragraph.
9. PAYMENT BY GUARANTOR. Whenever Guarantor pays any sum which is or may
become due under this Guaranty, written notice must be delivered to Bank
contemporaneously with such payment. Such notice shall be effective for
purposes of this paragraph when contemporaneously with such payment Bank
receives such notice either by: (a) personal delivery to the address and
designated department of Bank identified in subparagraph l (a) above, or (b)
United States mail, certified or registered, return receipt requested, postage
prepaid, addressed to Bank at the address shown in subparagraph l(a) above. In
the absence of such notice to Bank by Guarantor in compliance with the
provisions hereof, any sum received by Bank on account of the Guaranteed
Indebtedness shall be conclusively deemed paid by Borrower.
10. NOTICE OF SALE. In the event that Guarantor is entitled to receive
any notice under the Uniform Commercial Code, as it exists in the state
governing any such notice, of the sale or other disposition of any collateral
securing all or any part of the Guaranteed Indebtedness or this Guaranty,
reasonable notice shall be deemed given when such notice is deposited in the
United States mail, postage prepaid, at the address for Guarantor set forth in
subparagraph l(c) above, five (5) days prior to the date any public sale, or
after which any private sale, of any such collateral is to be held; PROVIDED,
HOWEVER, that notice given in any other reasonable manner or at any other
reasonable time shall be sufficient.
11. WAIVER OF BANK. No delay on the part of Bank in exercising any right
hereunder or failure to exercise the same shall operate as a waiver of such
right. In no event shall any waiver of the provisions of this Guaranty be
effective unless the same be in writing and signed by an officer of Bank, and
then only in the specific instance and for the purpose given.
12. SUCCESSORS AND ASSIGNS. This Guaranty is for the benefit of Bank, its
successors and assigns. This Guaranty is binding upon Guarantor's heirs,
executors, administrators, personal representatives and successors, including
without limitation any person or entity obligated by operation of law upon the
reorganization, merger, consolidation or other change in the organizational
structure of Guarantor.
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13. COSTS AND EXPENSES. Guarantor shall pay on demand by Bank all costs
and expenses (including without limitation all reasonable attorneys' fees)
incurred by Bank in connection with the preparation, administration, enforcement
and/or collection of this Guaranty. This covenant shall survive the payment of
the Guaranteed Indebtedness.
14. SEVERABILITY. If any provision of this Guaranty is held by a court of
competent jurisdiction to be illegal, invalid or enforceable under present or
future laws, such provision shall be fully severable, shall not impair or
invalidate the remainder of this Guaranty and the effect thereof shall be
confined to the provision held to be illegal, invalid or unenforceable.
15. NO OBLIGATION. Nothing contained herein shall be construed as an
obligation on the part of Bank to extend or continue to extend credit to
Borrower.
16. AMENDMENT. No modification or amendment 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 an officer of Bank,
and then shall be effective only in the specific instance and for the purpose
for which given.
17. CUMULATIVE RIGHTS. All rights and remedies of Bank hereunder are
cumulative of each other and of every other right or remedy which Bank may
otherwise have at law or in equity or under any instrument or agreement, and the
exercise of one or more of such rights or remedies shall not prejudice or impair
the concurrent or subsequent exercise of any other rights or remedies.
18. GOVERNING LAW. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND APPLICABLE FEDERAL LAWS.
19. VENUE. This Guaranty has been entered into in the county in Texas
where Bank's address for notice purposes is located, and it shall be performable
for all purposes in such county. Courts within the State of Texas shall have
jurisdiction over any and all disputes arising under or pertaining to this
Guaranty and venue for any such disputes shall be in the county or judicial
district where the Bank's address for notice purposes is located.
20. COMPLIANCE WITH APPLICABLE USURY LAWS. Notwithstanding any other
provision of this Guaranty or of any instrument or agreement evidencing,
governing or securing all or any part of the Guaranteed Indebtedness, Guarantor
and Bank by its acceptance hereof agree that Guarantor shall never be required
or obligated to pay interest in excess of the maximum nonusurious interest rate
as may be authorized by applicable law for the written contracts which
constitute the Guaranteed Indebtedness. It is the intention of Guarantor and
Bank to conform strictly to the applicable laws which limit interest rates, and
any of the aforesaid contracts for interest, if and to the extent payable by
Guarantor, shall be held to be subject to reduction to the maximum nonusurious
interest rate allowed under said law.
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21. DESCRIPTIVE HEADINGS. The captions in this Guaranty are for
convenience only and shall not define or limit the provisions hereof.
22. GENDER. Within this Guaranty, words of any gender shall be held and
construed to include the other gender.
23. ENTIRE AGREEMENT. This Guaranty contains the entire agreement between
Guarantor and Bank regarding the subject matter hereof and supersedes all prior
written and oral agreements and understandings, if any, regarding same;
provided, however, this Guaranty is in addition to and does not replace, cancel,
modify of affect any other guaranty of Guarantor now or hereafter held by Bank
that relates to Borrower or any other person or entity.
EXECUTED as of the date first above written.
GUARANTOR:
▇▇▇▇ PETROLEUM CORPORATION
a Delaware corporation
By: /s/▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇, ▇▇.
Executive Vice President
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