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Amended And Restated Continuing Guaranty - HPC Sunrise Onb

This is an actual contract by Hallador Petroleum.

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Sectors: Energy
Governing Law: Indiana, View Indiana State Laws
Effective Date: June 28, 2007
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exhibit 10.1


FOR VALUE RECEIVED and in consideration of credit given or to be given, and of other financial accommodations afforded or to be afforded to SUNRISE COAL, LLC , an Indiana limited liability company (hereinafter referred to as "Borrower"), pursuant to that certain Credit Agreement, dated April 19, 2006 (the "Credit Agreement"), as amended by that certain First Amendment to Credit Agreement and Ratification of Loan Documents, by and among the Bank (as defined herein), the Borrower and the Guarantor (as defined herein), dated as of June 28, 2007 (the "Amendment"), and the Loan Documents (as defined in the Amendment) executed or to be executed by and between the Borrower and OLD NATIONAL BANK , (hereinafter referred to as "Bank"), the receipt and sufficiency of which consideration is hereby acknowledged, and as an inducement to the Bank to extend such financial accommodations to the Borrower, the undersigned, HALLADOR PETROLEUM COMPANY , a Colorado corporation (hereinafter referred to as "Guarantor"), hereby guaranties the full and complete payment, when due, whether at maturity, by acceleration or otherwise, of any and all indebtedness of the Borrower to the Bank pursuant to the Credit Agreement, as amended, that certain Amended and Restated Line of Credit Note, dated of even date herewith, payable to the order of the Bank in the original aggregate principal amount of Forty Million and No/100 Dollars ($40,000,000.00) and that certain Term Loan Note to be executed and delivered by the Borrower in favor of the Bank at a future date as specified in the Credit Agreement (collectively the "Note ?) and all extensions, renewals, re-amortizations, restatements, modifications and amendments thereof, together with all costs, expenses and attorneys' fees (the above-described obligations and liabilities are hereinafter referred to as ?Liabilities").

If a Default (as such term is defined in the Credit Agreement) exists under the Credit Agreement, then immediately upon written demand by the Bank, the Guarantor shall pay the Liabilities as if such Liabilities constituted the direct and primary debts and obligations of the Guarantor. Except as provided herein, the Bank shall not be required to make any demand upon or pursue or exhaust any of its rights or remedies against the Borrower or others, including, without limitation, other guarantors, with respect to the payment or performance of any of the Liabilities or to pursue or exhaust any of its rights or remedies with respect to any collateral held by the Bank.

This Guaranty shall remain fully enforceable irrespective of any defenses which the Borrower may assert on the underlying Liabilities (other than the defense of payment of the Liabilities), including, without limitation, the failure of consideration, breach of warranty, statute of frauds, statute of limitations, accord and satisfaction, and usury.

This Guaranty shall be secured by Guarantor's assignment of its indirect interest in the Gas Contract (as such term is defined in the Credit Agreement), as evidenced by that certain Collateral Assignment of Gas Well Rights in favor of the Bank, dated as of April 19, 2006, and upon the disposition of Guarantor's indirect interest in the Gas Contract, $1,800,000 of the proceeds from the disposition of such interest, or all of such proceeds if less than such amount, to be deposited into an account with the Bank.

This Guaranty shall continue in force with respect to the Guarantor until the Bank receives written notice of the Guarantor's election not to guaranty any new Liabilities arising after receipt of such notice. Any such notice shall not in any way affect or limit either (i) the promise of the Guarantor giving such notice to pay all Liabilities existing at the time such notice is received by the Bank or (ii) the promises, obligations and undertakings of the remaining guarantors, if any, with respect to any Liabilities, including without limitation, those arising after the date of such notice. Regardless of when a renewal or extension of pre-termination Liabilities occurs (with or without adjustment of interest rate or other terms), the Liabilities shall be deemed to have been incurred prior to the termination to the extent of the renewal or extension and to be fully covered and included within this Guaranty.

The Guarantor waives (a) notice to the Guarantor or the Borrower or other guarantors of (i) acceptance of this Guaranty by the Bank, (ii) the Borrower incurring additional Liabilities, and (iii) the amount of the Liabilities at any time outstanding; (b) except as provided herein, presentment for payment, demand, protest, notice to the Guarantor, the other guarantors or the Borrower of dishonor, nonpayment, default and non-performance with respect to any of the Liabilities; (c) the right to require proration among the Guarantor and other guarantors; (d) any and all rights to require the Bank to marshal assets of the Borrower or any other guarantor or other party providing any security for the Liabilities; (e) any defense which the Borrower or other guarantors have against the Bank other than payment; (f) all defenses given to sureties or guarantors at law or in equity other than payment; and (g) all errors and omissions in connection with the Bank's administration of the Liabilities, except actions or inactions which amount to bad faith, gross negligence or willful misconduct. All remedies or actions by the Bank for payment or fulfillment of the Liabilities are cumulative and the pursuit of one shall not preclude the exercise of any other rights or remedies.

The Guarantor hereby grants to the Bank full power, in its uncontrolled discretion and without notice to the Guarantor, the other guarantors or the Borrower, to deal in any manner with the Liabilities, including, without limitation, the following powers: (a) to modify or otherwise change any terms of the Liabilities, or the rate of interest thereon, or to grant any extension or renewal thereof, and any other indulgence with respect thereto, and to effect any release, compromise, or settlement with respect thereto, all in accordance with the terms of the Loan Documents; (b) to forbear from enforcing payment or any term of the Liabilities; or (c) to release any other guarantor or surety of the Liabilities; provided, however, that (i) the Guarantor shall not be liable for any increase in debt, interest rate, or fees unless approved in writing by Guarantor; and (ii) the Bank shall not release any Collateral unless approved in writing by Guarantor. The obligations of the Guarantor hereunder shall not be released, discharged, or in any way affected, nor shall the Guarantor have any rights or recourse against the Bank by reason of any action the Bank may take, omit to take, or delay in taking under the foregoing powers. The obligations of the Guarantor under this Guaranty shall be joint and several obligations of the Guarantor and any other guarantors (now existing or hereafter arising) of the obligations of the Borrower to the Bank.

Without limiting the foregoing waivers by the Guarantor of right to notice, and without obligating the Bank to follow t
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