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Exhibit 10.8
CONTINUING GUARANTY AGREEMENT
THIS CONTINUING GUARANTY AGREEMENT (this " Guaranty
Agreement "), dated as of December 18, 2006, is made
by ATLAS ENERGY RESOURCES, LLC, a Delaware limited liability
company (the " Guarantor "), in favor of WACHOVIA
BANK, NATIONAL ASSOCIATION, as administrative agent for the Lenders
(the " Administrative Agent ").
W I T N E
S S E T H :
WHEREAS, the Lenders have made extensions of credit including
but not limited to Loans and Letters of Credit in the maximum
aggregate principal amount not to exceed $250,000,000 at any one
time outstanding to Atlas Energy Operating Company, LLC, a Delaware
limited liability company (the " Borrower "),
pursuant to that certain Revolving Credit Agreement dated as of
December 18, 2006, by and among the Borrower, the financial
institutions (the " Lenders ") party thereto, and
Wachovia Bank, National Association, in its capacity of the issuer
of certain letters of credit and as the Administrative Agent for
the Lenders thereunder (the Credit Agreement together with the
exhibits and schedules thereto and all extensions, renewals,
amendments, substitutions and replacements thereto and thereof is
herein referred to as the " Credit Agreement ");
WHEREAS, (i) the Letters of Credit may be issued under the
Credit Agreement for the account of one or more of the Guarantors,
(ii) the proceeds of the Loans under the Credit Agreement may
be used by the Borrower to make loans to one or more of the
Guarantors and for other general corporate purposes of the Borrower
and the Guarantors, and (iii) Hedging Agreements may be
entered into by one or more of the Guarantors and any Lender or its
Affiliate, all as permitted pursuant to the Credit Agreement and
all of which will directly and indirectly benefit the Borrower and
the Guarantors;
WHEREAS, as a condition precedent to extending credit to the
Borrower pursuant to the Credit Agreement, the Lenders have
required that, inter alia , each of the Guarantors execute
and deliver to the Administrative Agent, for and on behalf of the
Lenders, a guaranty agreement;
WHEREAS, the Guarantor has determined, reasonably and in good
faith, that (i) it has adequate capital to conduct its
business as presently conducted and as proposed to be conducted,
(ii) it will be able to meet its obligations hereunder and in
respect of its existing and future indebtedness and liabilities
(contingent or otherwise) as and when the same shall become due and
payable, including those under this Guaranty Agreement,
(iii) it is otherwise solvent and (iv) the execution and
delivery of this Guaranty Agreement and the consummation of the
transactions contemplated hereby will not render it insolvent;
WHEREAS, the Guarantor has determined that the execution and
delivery of this Guaranty Agreement is in furtherance of its
corporate purposes and in its best interest and that it will derive
substantial benefit, whether directly or indirectly, from the
making of this Guaranty Agreement, having regard for all relevant
facts and circumstances; and
WHEREAS, the Guarantor has agreed to execute and deliver this
Guaranty Agreement to the Administrative Agent, for the benefit of
the Lenders.
NOW THEREFORE, for good and valuable consideration the receipt
of which is hereby acknowledged, and in order to induce the Lenders
to make Loans to the Borrower pursuant to the Credit Agreement by
fulfilling the requirements of the Credit Agreement, the Guarantor
agrees, for the benefit of each Lender, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Certain Terms . The following
capitalized terms when used in this Guaranty Agreement, including
its preamble and recitals, shall have the following meanings (such
definitions to be equally applicable to the singular and plural
forms thereof):
" Administrative Agent " is defined in the
preamble.
" Borrower " is defined in the first recital.
" Commitments " means each Commitment as defined
in the Credit Agreement.
" Credit Agreement " is defined in the first
recital.
" Guarantor " is defined in the preamble.
" Guaranty Agreement " is defined in the
preamble.
" Lenders " is defined in the first recital.
" Taxes " is defined in clause (1) of
Section 2.7 .
" U.C.C. " means the Uniform Commercial Code as in
effect in the State of Texas.
SECTION 1.2 Credit Agreement Definitions . Unless
otherwise defined herein or the context otherwise requires,
capitalized terms used in this Guaranty Agreement, including its
preamble and recitals, have the meanings provided in the Credit
Agreement.
SECTION 1.3 U.C.C. Definitions . Unless otherwise
defined herein or the context otherwise requires, terms for which
meanings are provided in the U.C.C. are used in this Guaranty
Agreement, including its preamble and recitals, with such
meanings.
ARTICLE II
GUARANTY PROVISIONS
SECTION 2.1 Guaranty Agreement . The Guarantor
hereby absolutely, unconditionally, and irrevocably
(1) guarantees the full and punctual payment when due, whether
at stated maturity, by required prepayment, declaration,
acceleration, demand or otherwise, of all Indebtedness of the
Borrower and each other Obligor now or hereafter existing under
each of the Credit Agreement, the Notes and each other Loan
Document to which the Borrower or such other Obligor is or may
become a party, whether for principal, interest, fees, expenses or
otherwise (including all such amounts which would become due but
for the operation of the automatic stay under Section 362(a)
of the United States Bankruptcy Code, 11 U.S.C. §362(a), and
the operation of Sections 502(b) and 506(b) of the United States
Bankruptcy Code, 11 U.S.C. §502(b) and §506(b)), and
(2) indemnifies and holds harmless each Lender and each holder
of a Note for any and all costs and expenses (including reasonable
attorney’s fees and expenses) incurred by such Lender or such
holder, as the case may be, in enforcing any rights under this
Guaranty Agreement; provided , however , that the
Guarantor shall be liable under this Guaranty Agreement for the
maximum amount of such liability that can be hereby incurred
without rendering this Guaranty Agreement, as it
relates to the Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent
transfer, and not for any greater amount. This Guaranty Agreement
constitutes a guaranty of payment when due and not of collection,
and the Guarantor specifically agrees that it shall not be
necessary or required that any Lender or any holder of any Note
exercise any right, assert any claim or demand or enforce any
remedy whatsoever against the Borrower or any other Obligor (or any
other Person) before or as a condition to the obligations of the
Guarantor hereunder.
SECTION 2.2 Acceleration of Guaranty Agreement .
The Guarantor agrees that, in the event of the occurrence of any
event of the type described in Section 10.01(e),
(f) or (g) of the Credit Agreement, with respect to
the Borrower, any other Obligor or the Guarantor, and if such event
shall occur at a time when any of the Indebtedness may not then be
due and payable by the Borrower due to any automatic stay or other
debtor relief laws, the Guarantor will pay to the Lenders forthwith
the full amount which would be payable hereunder by the Guarantor
if all such Indebtedness were then due and payable.
SECTION 2.3 Guaranty Agreement Absolute, etc .
This Guaranty Agreement shall in all respects be a continuing,
absolute, unconditional and irrevocable guaranty of payment, and
shall remain in full force and effect until all Indebtedness of the
Borrower and each other Obligor has been paid in full, all
obligations of the Guarantor hereunder shall have been paid in
full, all Commitments shall have terminated and all Lender Hedging
Agreements have terminated. Guarantor may not rescind or revoke its
obligations hereunder. The Guarantor guarantees that the
Indebtedness of the Borrower and each other Obligor will be paid
strictly in accordance with the terms of the Credit Agreement and
each other Loan Document under which they arise, regardless of any
law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of any
Lender or any holder of any Note with respect thereto. The
liability of the Guarantor under this Guaranty Agreement shall be
absolute, unconditional and irrevocable irrespective of:
(1) any lack of validity, legality or enforceability of the
Credit Agreement, any Note or any other Loan Document; (2) the
failure of any Lender or any holder of any Note (a) to assert
any claim or demand or to enforce any right or remedy against the
Borrower, any other Obligor or any other Person (including any
other guarantor) under the provisions of the Credit Agreement, any
Note, any other Loan Document or otherwise, or (b) to exercise
any right or remedy against any other guarantor of, or collateral
securing, any Indebtedness of the Borrower or any other Obligor;
(3) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Indebtedness of the
Borrower or any other Obligor, or any other extension, compromise
or renewal of any Indebtedness of the Borrower or any other
Obligor; (4) any reduction, limitation, impairment or
termination of any Indebtedness of the Borrower or any other
Obligor for any reason, including any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to
(and the Guarantor hereby waives any right to or claim of) any
defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise, unenforceability of, or any other event
or occurrence affecting, any Indebtedness of the Borrower, any
other Obligor or otherwise; (5) any amendment to, rescission,
waiver, or other modification of, or any consent to departure from,
any of the terms of the Credit Agreement, any Note or any other
Loan Document; (6) any addition, exchange, release, surrender
or non-perfection of any collateral, or any amendment to or waiver
or release or addition of, or consent to departure from, any other
guaranty, held by any Lender or any holder of any Note securing any
of the Indebtedness of the Borrower or any other Obligor;
(7) the insolvency or bankruptcy of, or similar event
affecting, the Borrower or any other Obligor; or (8) any other
circumstance which might otherwise constitute a defense available
to, or a legal or equitable discharge of, the Borrower, any other
Obligor, any surety or any guarantor. Guarantor waives all rights
and defenses which may arise with respect to any of the foregoing,
and Guarantor waives any right to revoke this Guaranty Agreement
with respect to future indebtedness. Guarantor waives all rights or
defenses under (1) Section 34.01 et seq
. of the Texas Business and Commerce Code , as amended,
(2) Section 17.001 of the Texas Civil Practice and
Remedies Code , as amended, (3) Rule 31 of the Texas
Rules of Civil Procedure , as amended, or (4) common law,
in equity, under contract, by statute, or otherwise.
SECTION 2.4 Reinstatement . The
Guarantor agrees that this Guaranty Agreement shall continue to be
effective or be reinstated, as the case may be, if at any time any
payment (in whole or in part) of any of the Indebtedness is
rescinded or must otherwise be restored b
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