EXHIBIT 10.24
GUARANTY AND SUPPORT AGREEMENT
THIS GUARANTY AND SUPPORT AGREEMENT (this "AGREEMENT") dated as of
September 27, 1996, is made by Cliffwood Oil & Gas Corp., a Texas corporation.
RECITALS:
A. Reference is herein made to that certain Agreement of Limited
Partnership of even date herewith by and between Cliffwood Energy Company, a
California corporation, Energy Capital Investment Company PLC, an English
investment company, and EnCap Equity 1996 Limited Partnership, a Texas limited
partnership, establishing Cliffwood Acquisition - 1996 Limited Partnership, a
Texas limited partnership (the "PARTNERSHIP AGREEMENT"). Terms not otherwise
defined herein shall have the respective meanings assigned to them in the
Partnership Agreement.
B. The undersigned hereby acknowledges and agrees that (i) it is the owner
of all of the outstanding shares of capital stock of the General Partner, (ii)
the representations, warranties, covenants and agreements of the undersigned can
reasonably be expected to be of benefit to the General Partner and that it is in
the undersigned's best interest to make this Agreement and (iii) it understands
that the Limited Partners would not be willing to enter into the Partnership
Agreement and to acquire interests as limited partners in the Partnership
without the execution and delivery by the undersigned of this Agreement, and the
undersigned is executing and delivering this Agreement to induce the Limited
Partners to enter into the Partnership Agreement and to acquire interests as
limited partners in the Partnership.
AGREEMENT:
NOW, THEREFORE, in view of the foregoing Recitals and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby agrees as follows for the benefit of the
Partnership and the Limited Partners:
1. The undersigned hereby irrevocably, absolutely and unconditionally
guarantees to the Partnership and the Limited Partners the prompt, complete and
full performance, when due, of all obligations, agreements and undertakings of
the General Partner under the Partnership Agreement and any other agreement made
by the General Partner or an Affiliate thereof with the Partnership or the
Limited Partners (collectively, the "PARTNERSHIP DOCUMENTS"). In addition to,
but without limiting the foregoing, the undersigned agrees to provide or will
cause to be provided such funds as may be required from time to time by the
General Partner in order for the General Partner to pay its Capital
Contributions to the Partnership in accordance with the terms of the
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Partnership Agreement. The obligations of the undersigned hereunder are
independent of the obligations of the General Partner and its Affiliates, and
the Partnership and the Limited Partners may proceed directly to enforce all
rights hereunder without proceeding against or joining the General Partner, any
of its Affiliates or any other person. The guaranty contemplated hereby is an
absolute, present and continuing guaranty and is in no way conditional or
contingent upon any other action or circumstance whatsoever.
2. The obligations of the undersigned hereunder shall commence as of the
date hereof and shall continue until the earlier to occur of (i) the termination
of the Partnership or (ii) the written waiver of the undersigned's obligations
hereunder by the Limited Partners.
3. The obligations of the undersigned under this Agreement shall be
irrevocable, absolute, unconditional and primary irrespective of the validity or
enforceability of the Partnership Agreement or any other Partnership Document,
shall not be subject to any counterclaim, set off or defense based upon any
claim the undersigned may have against the General Partner, the Partnership or
any Limited Partner and shall remain in full force and effect without regard to,
and shall not be affected or impaired by any of the following, although without
notice to or consent of the undersigned: (i) any amendment to or modification of
the Partnership Agreement or any other Partnership Document; (ii) any failure,
omission or delay to enforce, assert or exercise any right, power or remedy
conferred by the terms of the Partnership Agreement or any other Partnership
Document; (iii) any exercise or waiver of any right, power or remedy conferred
by the terms of the Partnership Agreement or any other Partnership Document;
(iv) the dissolution or termination of the General Partner; (v) the bankruptcy
or insolvency of the General Partner; or (vi) any other circumstance whether
similar or dissimilar to the foregoing. No action which the Partnership or the
Limited Partners may take or omit to take in connection with exercising any
right hereunder and no course of dealing by the Partnership or the Limited
Partners with any person who has entered into a similar agreement or any other
person, shall release or diminish the undersigned's obligations or agreements
hereunder or affect the agreements herein.
4. No delay on the part of the Partnership or the Limited Partners in
exercising any right hereunder or any failure to exercise such right shall
operate as a waiver of such right; nor shall any modification or waiver of
provisions hereof be effective unless in writing; nor shall any such waiver be
applicable except in the specific instance for which given.
5. The undersigned hereby expressly waives notice of acceptance of this
Agreement, notice of default and all other notices whatsoever with respect
thereto, any demand hereunder, the prosecution of any suits against the General
Partner or any other person, and any other act or omission or thing or delay to
do any other act or thing which might in any manner or to any extent vary the
risk of the undersigned or which otherwise might operate as a discharge of the
undersigned hereunder.
6. If any provision of this Agreement is held to be unenforceable, this
Agreement shall be considered divisible and such provision shall be held
inoperative to the extent it is deemed unenforceable, and in all other respects
this Agreement shall remain in full force and effect;
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provided, however, that if any such provision may be made enforceable by
limitation thereof, then such provision shall be deemed to be so limited and
shall be enforceable to the maximum extent permitted by applicable law.
7. If the undersigned fails to perform its obligations hereunder, the
undersigned shall pay to the Partnership and the Limited Partners all costs and
expenses, including without limitation, all court costs and reasonable
attorneys' fees, incurred by any of them in enforcing this Agreement.
8. The undersigned's rights and obligations hereunder may not be assigned
or delegated. This Agreement shall inure to the benefit of (i) the Partnership
and its successors and (ii) the Limited Partners and their respective successors
and assigns.
9. All notices or other communications to be given pursuant to the terms
hereof shall be in writing and shall be considered as properly given if given by
(i) personal delivery, (ii) expedited delivery service with proof of delivery,
(iii) first class mail postage prepaid, or (iv) prepaid telegram, telex or
facsimile (with signed confirmed copy to follow by mail in the same manner as
provided in CLAUSE (II) above). Each party's address for notices and other
communications shall be as set forth below or such other address as shall be
designated in writing by the applicable party sent in accordance herewith.
IF TO THE UNDERSIGNED:
000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Fax No.: 713/000-0000
IF TO THE PARTNERSHIP:
000 Xxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
Fax No.: 713/000-0000
IF TO THE LIMITED PARTNERS:
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Fax No.: 713/000-0000
10. The undersigned hereby represents and warrants to and for the benefit
of the Partnership and the Limited Partners as follows:
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(i) The undersigned is a corporation duly formed, validly existing and in
good standing under the laws of the State of Texas.
(ii) The undersigned has all requisite power and authority to execute and
deliver this Agreement and to perform its obligations hereunder.
(iii) The execution, delivery and performance by the undersigned of this
Agreement has been duly and validly authorized by all requisite corporate
action, and no other corporate or shareholder action is required to be taken to
authorize such execution, delivery and performance.
(iv) The execution, delivery and performance of this Agreement is within
its corporate powers and will not (a) be in contravention of or violate any
provisions of the undersigned's charter or other governing documents, as amended
to the date hereof, or (b) be in contravention of or result in any breach of or
constitute a default under any applicable law, rule or regulation or any loan,
note or other agreement or instrument to which the undersigned is a party or by
which it or any of its properties are bound.
(v) When delivered to the Partnership and the Limited Partners, this
Agreement will be duly and validly executed by the undersigned and will be
binding upon it in accordance with the terms hereof.
(vi) No consent, approval, authorization or order of any court or
governmental agency or authority or of any third party which has not been
obtained is required in connection with the execution, delivery and performance
of this Agreement by the undersigned.
(vii) There is no pending or, to the best of the undersigned's knowledge,
threatened judicial, administrative or arbitral action, suit or proceeding
against or investigation of the undersigned which is not fully insured against
(except standard amounts) and which might materially and adversely affect the
financial condition of the undersigned or the undersigned's ability to perform
its obligations under this Agreement.
(viii)As of the date hereof, none of the financial statements or other
written documents or information delivered herewith or heretofore by or on
behalf of the undersigned to the Limited Partners in connection with this
Agreement, the Partnership Agreement or any other Partnership Document contains
any untrue statement of a material fact or omits to state a material fact
necessary to keep the statements contained therein from being misleading. There
is no fact peculiar to the undersigned which materially adversely affects or in
the future may (so far as the undersigned can now foresee) materially adversely
affect the business, property or assets, or financial condition of the
undersigned which has not been set forth in the financial statements or other
written documents or information furnished to the Limited Partners by or on
behalf of the undersigned prior to the date hereof in connection with the
transactions contemplated hereby.
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The foregoing representations and warranties shall survive the execution and
delivery of this Agreement, regardless of any investigation made by or on behalf
of the Partnership or the Limited Partners.
11. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY AND INTERPRETED, CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TEXAS.
12. The undersigned, the Partnership and the Limited Partners hereby
knowingly, voluntarily and intentionally waive any right to trial by jury the
undersigned, the Partnership and the Limited Partners may have in any action or
proceeding, in law or in equity, in connection with this Agreement or the
transactions related thereto. The undersigned represents and warrants that no
representative or agent of the Partnership or the Limited Partners has
represented, expressly or otherwise, the Partnership or the Limited Partners
will not, in the event of litigation, seek to enforce this jury trial waiver.
The undersigned acknowledges that the Partnership and the Limited Partners have
been induced to enter into the contractual arrangements contemplated hereby and
the Partnership Agreement by, among other things, the provisions of this
paragraph.
13. This Agreement may be executed in several counterparts, each of which
shall be deemed an original and all of which shall constitute but one and the
same instrument.
14. Nothing in this Agreement, either express or implied, is intended to
or shall confer upon any person other than the parties hereto, and their
respective successors and permitted assigns, any rights, benefits, or remedies
of any nature whatsoever under or by reason of this Agreement.
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IN WITNESS WHEREOF, the undesigned has executed this Agreement as of the
day and year first above written.
CLIFFWOOD OIL & GAS CORP.
By: /S/ XXXXX X. XXXXXXXXX
Name: Xxxxx X. Xxxxxxxxx
Title: President
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