Exhibit 4.21
AMENDED AND RESTATED BARNICO
GUARANTY
AMENDED AND
RESTATED BARNICO GUARANTY, dated as of October 31, 2007 (as
amended, restated or otherwise modified from time to time in
accordance with the terms hereof, this “ Guaranty
”), made by BARNICO DRILLING, INC., a Texas corporation
(“ Guarantor ” or “ Barnico
”), in favor of CASTLERIGG MASTER INVESTMENTS LTD., a company
organized under the laws of the British Virgin Islands, in its
capacity as collateral agent (in such capacity, the “
Collateral Agent ”) for the benefit of the Buyers (as
defined below).
W
I T N
E S S E T H
:
WHEREAS, Wentworth
Energy, Inc., an Oklahoma corporation (the “ Parent
”), and each party listed as a “Buyer” on the
Schedule of Buyers attached thereto (collectively, the “
Buyers ”) are parties to that certain Securities
Purchase Agreement, dated as of July 24, 2006 (as amended, restated
or otherwise modified from time to time prior to the date hereof,
the “ Existing Securities Purchase Agreement
”), pursuant to which, among other things, the Buyers
purchased from the Parent an aggregate original principal amount of
$32,350,000 of senior secured convertible notes (as amended,
restated or otherwise modified from time to time prior to the date
hereof, the “ Existing Notes ”);
WHEREAS,
contemporaneously with the consummation of the transactions
contemplated by the Existing Securities Purchase Agreement, the
following transactions (among others) occurred: (i) the Parent and
Wentworth Oil & Gas, Inc., a Nevada corporation and subsidiary
of the Parent (“ WOG ”), entered into that
certain Security Agreement, dated as of July 25, 2006, in favor of
the Collateral Agent for the benefit of the Buyers, as subsequently
amended by that certain Joinder Agreement, dated as of August 8,
2006 (the “ 2006 Joinder Agreement ”), in favor
of the Collateral Agent for the benefit of the Buyers, to join
Barnico as a party thereto and collateral grantor thereunder (said
security agreement, as amended by the 2006 Joinder Agreement, and
as otherwise amended, restated or otherwise modified from time to
time prior to the date hereof, the “ Existing Security Agreement
”); (ii) WOG entered into that certain Guaranty, dated as of
July 25, 2006, in favor of the Collateral Agent for the benefit of
the Buyers (said guaranty, as amended, restated or otherwise
modified from time to time prior to the date hereof, the “
Existing WOG Guaranty
”); and (iii) the Parent and WOG entered into that certain
Pledge Agreement, dated as of July 25, 2006, in favor of Collateral
Agent for the benefit of the Buyers, as amended by that certain
Pledge Amendment, dated August 8, 2006 (the “ 2006 Pledge
Amendment ”), to include as collateral thereunder the
shares of Barnico capital stock referenced in the 2006 Pledge
Amendment (said pledge agreement, as amended by the 2006 Pledge
Amendment, and as otherwise amended, restated or otherwise modified
from time to time prior to the date hereof, the “ Existing
Pledge Agreement ”);
WHEREAS, the
Parent entered into certain deeds of trust encumbering certain real
property and personal property of the Parent (said deeds of trust,
as amended, restated or otherwise modified from time to time prior
to the date hereof, the “ Existing Deeds of Trust
”), in favor of the trustee referenced therein for the
benefit of the Collateral Agent for the benefit of the
Buyers;
WHEREAS,
contemporaneously with Guarantor’s execution and delivery of
the 2006 Joinder Agreement, Guarantor entered into that certain
Guaranty, dated as of August 8, 2006 (said guaranty, as amended,
restated or otherwise modified from time to time prior to the date
hereof, the “ Existing Barnico Guaranty ”), in
favor of the Collateral Agent for the benefit of the
Buyers;
WHEREAS, the
Parent and the Buyers, severally, are entering into those certain
Amendment Agreements, each dated as of the date hereof (the “
Amendment Agreements ”), pursuant to which (among
other things) the Parent and the Buyers have agreed to amend the
Existing Securities Purchase Agreement (as so amended, and as
thereafter amended, restated or otherwise modified from time to
time, the “ Securities Purchase Agreement ”) to
provide for, among other things, the amendment and restatement of
the Existing Barnico Guaranty by Guarantor’s execution and
delivery of this Guaranty and the following additional transactions
(among others) contemporaneously therewith: (i) the amendment and
restatement of all of the Existing Notes by the Parent’s
issuance of amended and restated notes therefor, in the form
attached as an exhibit to the Amendment Agreements (said amended
and restated notes, as executed and delivered, and as thereafter,
amended, restated or otherwise modified from time to time, the
“ Amended and Restated Notes ”); (ii) the
Parent’s issuance and sale to one of the Buyers of a new
senior secured convertible note in the form attached as an exhibit
to the Amendment Agreements (said new note, as executed and
delivered, and as thereafter amended, restated or otherwise
modified from time to time, the “ New Note ”;
collectively with the Amended and Restated Notes, the “
Notes ”); (iii) the amendment and restatement of the
Existing Pledge Agreement in the form attached as an exhibit to the
Amendment Agreements (said amended and restated pledge agreement,
as executed and delivered, and as thereafter amended, restated or
otherwise modified from time to time, the “ Pledge
Agreement ”); (iv) the amendment and restatement of the
Existing Security Agreement in the form attached as an exhibit to
the Amendment Agreements (said amended and restated security
agreement, as executed and delivered, and as thereafter amended,
restated or otherwise modified from time to time, the “
Security Agreement ”); (v) the amendment and
restatement of the Existing Deeds of Trust heretofore filed in
Anderson, Freestone, Jones and Leon Counties, Texas, in the form
attached as an exhibit to the Amendment Agreements (said amended
and restated deeds of trust, as executed and delivered, and as
thereafter amended, restated or otherwise modified from time to
time, the “ Deeds of Trust ”); and (vi) to the
extent not heretofore terminated, the termination of the Existing
Deeds of Trust filed in Archer, Pecos and Wichita Counties,
Texas;
WHEREAS, WOG has
been dissolved and, prior hereto or contemporaneously herewith, WOG
is being released from all of its obligations under the Existing
WOG Guaranty, the Existing Pledge Agreement and the Existing
Security Agreement;
WHEREAS, to induce
each of the Buyers to execute and deliver its respective Amendment
Agreement and perform its respective obligations under the
Securities Purchase Agreement, Guarantor has agreed to execute and
deliver to the Collateral Agent, for the benefit of the Buyers,
this Guaranty, which amends, restates and supersedes the Existing
Barnico Guaranty; and
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WHEREAS, Guarantor
has determined that the execution, delivery and performance of this
Guaranty directly benefits, and is in the best interest of,
Guarantor;
NOW, THEREFORE, in
consideration of the premises and the agreements herein, and in
order to induce each of the Buyers to execute and deliver its
respective Amendment Agreement and perform its respective
obligations under the Securities Purchase Agreement, Guarantor
hereby agrees, for the benefit of the Collateral Agent for the
further benefit of each Buyer, as follows:
SECTION 1.
Definitions . Reference is hereby made to the
Securities Purchase Agreement and the Notes for a statement of the
terms thereof. All terms used in this Guaranty, which are
defined in the Securities Purchase Agreement or the Notes and not
otherwise defined herein, shall have the same meanings herein as
set forth therein.
SECTION 2.
Guaranty . Guarantor hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment, as
and when due and payable, by stated maturity or otherwise, of all
“Obligations” (as defined in the Security Agreement) of
the Parent from time to time owing by the Parent in respect of the
Securities Purchase Agreement, the Notes and the other Transaction
Documents, including, without limitation, all interest that accrues
after the commencement of any Insolvency Proceeding (as defined in
the Security Agreement) of the Parent, whether or not the payment
of such interest is unenforceable or is not allowable due to the
existence of such Insolvency Proceeding, and all fees, commissions,
expense reimbursements, indemnifications and all other amounts due
or to become due under any of the Transaction Documents (such
obligations, to the extent not paid by the Parent, being the
“ Guaranteed Obligations ”), and agrees to pay
any and all expenses (including reasonable counsel fees and
expenses) reasonably incurred by the Collateral Agent in enforcing
any rights under this Guaranty. Without limiting the
generality of the foregoing, Guarantor’s liability hereunder
shall extend to all amounts that constitute part of the Guaranteed
Obligations and would be owed by the Parent to the Collateral Agent
(for the benefit of the Buyers) under the Securities Purchase
Agreement and the Notes but for the fact that they are
unenforceable or not allowable due to the existence of an
Insolvency Proceeding involving the Parent or any other guarantor
of all or any part of the Guaranteed Obligations (the Parent and
any other guarantor, each a “ Transaction Party
”).
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SECTION 3. Guaranty
Absolute; Continuing Guaranty; Assignments .
(a)
Guarantor guarantees
that the Guaranteed Obligations will be paid strictly in accordance
with the terms of the Transaction Documents, regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of the Collateral Agent
with respect thereto. The obligations of Guarantor under this
Guaranty are independent of the Guaranteed Obligations, and a
separate action or actions may be brought and prosecuted against
Guarantor to enforce such obligations, irrespective of whether any
action is brought against any Transaction Party or whether any
Transaction Party is joined in any such action or actions.
The liability of Guarantor under this Guaranty shall be
irrevocable, absolute and unconditional irrespective of, and
Guarantor hereby irrevocably waives, to the extent permitted by
law, any defenses it may now or hereafter have in any way relating
to, any or all of the following:
(i)
any lack of validity or enforceability of any Transaction Document
or any agreement or instrument relating thereto;
(ii)
any change in the time, manner or place of payment of, or in any
other term of, all or any of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from any
Transaction Document, including, without limitation, any increase
in the Guaranteed Obligations resulting from the extension of
additional credit to any Transaction Party or
otherwise;
(iii)
any taking, exchange, release or non-perfection of any Collateral
(as defined in any Security Document), or any taking, release or
amendment or waiver of or consent to departure from any other
guaranty for all or any of the Guaranteed Obligations;
(iv)
any change, restructuring or termination of the corporate, limited
liability company or partnership structure or existence of any
Transaction Party; or
(v)
any other circumstance (including any statute of limitations) or
any existence of or reliance on any representation by the
Collateral Agent that might otherwise constitute a defense
available to, or a discharge of, a Transaction Party or any other
guarantor or surety.
This Guaranty shall
continue to be effective or be reinstated, as the case may be, if
at any time any payment of any of the Guaranteed Obligations is
rescinded or must otherwise be returned by the Collateral Agent or any other Person
upon the insolvency, bankruptcy or reorganization of any
Transaction Party or otherwise, all as though such payment had not
been made.
(b)
This Guaranty is a
continuing guaranty and shall (i) remain in full force and effect
until the indefeasible cash payment in full of the Guaranteed
Obligations (other than inchoate indemnity obligations) and/or
complete conversion of all of the Parent’s obligations under
the Notes to equity securities of the Parent and payment of all
other amounts payable under this Guaranty (other than inchoate
indemnity obligations) and shall not terminate for any reason prior
to the respective Maturity Date of each Note (other than payment in
full of the Notes and/or complete conversion of all of the
Parent’s obligations under the Notes to equity securities of
the Parent) and (ii) be binding upon Guarantor and its respective
successors and assigns. This Guaranty shall inure to the
benefit of and be enforceable by the Collateral Agent (for the benefit of the
Buyers) and the Collateral Agent’s successors, and
permitted pledgees, transferees and assigns. Without limiting
the generality of the foregoing sentence, the Collateral Agent or
any Buyer may pledge, assign or otherwise transfer all or any
portion of its rights and obligations under and subject to the
terms of any Transaction Document to any other Person, and such
other Person shall thereupon become vested with all the benefits in
respect thereof granted to the Collateral Agent or such Buyer (as
the case may be) herein or otherwise, in each case as provided in
the Securities Purchase Agreement or such other Transaction
Document.
SECTION 4.
Waivers .
(a)
To the extent permitted
by applicable law, Guarantor hereby waives promptness, diligence,
notice of acceptance and any other notice with respect to any of
the Guaranteed Obligations and this Guaranty and any requirement
that the Collateral Agent exhaust
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any right or take
any action against any Transaction Party or any other Person or any
Collateral. Guarantor acknowledges that it will receive
direct and indirect benefits from the financing arrangements
contemplated herein and that the waiver set forth in this Section
4(a) is knowingly made in contemplation of such benefits.
Guarantor hereby waives any right to revoke this Guaranty,
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