Exhibit 10.43
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT (this
Guaranty Agreement, together with the exhibits and schedules hereto
and all extensions, renewals, amendments, substitutions and
replacements hereto and hereof, is hereinafter referred to as the
“ Guaranty Agreement ”) is dated as of the 28th
day of September, 2007, by Westmoreland Coal Company, a Delaware
corporation (“ WCC ”) and each person or entity
now or hereafter executing a guaranty assumption agreement in the
form of Annex 1 attached hereto (each of the foregoing being a
“ Guarantor ” and collectively, the “
Guarantors ”) to and for the benefit of NRG Texas
Power LLC, a Delaware limited liability company (together with its
successors and assigns, the “ Beneficiary
”).
WITNESSETH
WHEREAS, Texas Westmoreland Coal Co.
(“ TWCC ”) has entered into that certain Lignite
Supply Agreement dated as of the date hereof between TWCC and
Beneficiary (the “ Supply Agreement ”);
WHEREAS, TWCC is a direct or indirect
subsidiary of the Guarantors; and
WHEREAS, it is a condition precedent
under the Supply Agreement that WCC provide this Guaranty Agreement
in favor of Beneficiary.
AGREEMENT
NOW, THEREFORE, as inducement to the
Beneficiary to enter into the Supply Agreement and for other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, each of the Guarantors agrees as
follows:
1. Defined Terms
. Capitalized terms used herein but not defined herein shall have
the meaning ascribed to them in the Supply Agreement.
2. Guaranty .
Each of the Guarantors unconditionally and irrevocably guarantees
to Beneficiary, the full and punctual payment when due of all
TWCC’s obligations under the Supply Agreement to the extent
arising from any event that would constitute a TWCC Event of
Default (and including such obligations, liabilities, and
indebtedness described above arising or accruing after the
commencement of any bankruptcy, insolvency, reorganization, or
similar proceeding with respect to TWCC, or any Guarantor or which
would have not arisen or accrued but for the commencement of such
proceeding, even if the claim for such obligation, liability, or
indebtedness is not enforceable or allowable in such proceeding)
(all of the foregoing obligations, liabilities and indebtedness
described in this Section 2 , are referred to herein
collectively as the “ Guaranteed Obligations ”
and each as a “ Guaranteed Obligation ”). In the
event of a default in performance of any of the Guaranteed
Obligations, Guarantor shall promptly pay and perform or cause to
be paid and performed such Guaranteed Obligations upon receiving
written notice of such default from the Beneficiary.
Signature Page to Guaranty
Agreement
3. Obligations Absolute
and Unconditional .
(a) This Guaranty is, to the maximum
extent permitted by law, a primary obligation of Guarantor and
shall be irrevocable, absolute and unconditional and shall remain
in full force and effect until such time as all Guaranteed
Obligations shall have been absolutely and completely discharged
and performed.
(b) Notwithstanding the foregoing or
any other provision in this Guaranty to the contrary, (i) each
Guarantor shall have the full benefit of all defenses (including
any defense of non-performance due to Force Majeure (as defined in
the Supply Agreement)), setoffs, counterclaims, reductions,
diminution or limitations available to TWCC pursuant to or arising
from the Supply Agreement or otherwise, except for those arising
out of (A) any legal limitation, lack of authority, disability
or incapacity of TWCC, or (B) any bankruptcy, insolvency,
dissolution or liquidation of TWCC, or (C) any invalidity or
illegality of the Supply Agreement due to the status of TWCC, and
(ii) each Guarantor shall have the full benefit of, and does
not waive or relinquish its rights and remedies accorded under,
applicable statutes of limitation and repose.
4. Waiver . To
the maximum extent permitted by law, and except as expressly
provided in this Guaranty or rights of notice provided in the
Supply Agreement, each of the Guarantors hereby expressly waives:
(a) notice of acceptance of this Guaranty by Beneficiary
(which acceptance is conclusively presumed by delivery hereof to
Beneficiary); (b) grace, demand, presentment and protest with
respect to the Guaranteed Obligations or to any instrument, Supply
Agreement or document evidencing or creating same; (c) notice
of grace, demand, presentment and protest; (d) notice of
non-payment or other defaults, of intention to accelerate and of
acceleration of the Guaranteed Obligations; and (e) the
renewal, extension, amendment and/or modification of any of the
terms and provisions of the Supply Agreement.
5. Ultimate Liability of
the Guarantor . This is a guaranty of payment and
performance, and not merely of collection, and Guarantor agrees
that this Guaranty may be enforced by Beneficiary without resorting
to or exhausting any other security, party (including, without
limitation, TWCC), or collateral. Guarantor hereby expressly waives
any right or claim to force Beneficiary to proceed first against
TWCC or any other guarantor or any other party as to any of the
Guaranteed Obligations, and agrees that no delay or refusal
(subject to applicable statutes of limitation and repose) of
Beneficiary to exercise any right or privilege which Beneficiary
has or may have against TWCC, arising from the Supply Agreement,
shall operate to impair the liability of Guarantor hereunder.
6. Term of Guaranty
Agreement . This Guaranty shall remain in full force and
effect until the later of termination of the Supply Agreement and
fulfillment by TWCC of its obligations under the Supply
Agreement.
7. Reinstatement
. The Guaranteed Obligations shall be automatically reinstated if,
and to the extent that, for any reason any payment by or on behalf
of Guarantor in respect of the Guaranteed Obligations is rescinded
as required by law or judicial decision or must be otherwise
restored by any holder of any of the Guaranteed Obligations,
whether as a result of any proceedings in bankruptcy or
reorganization, or otherwise.
Signature Page to Guaranty
Agreement
8. Payment .
Guarantor agrees that all amounts payable by Guarantor to
Beneficiary under this Guaranty shall be paid free and clear of,
and without deduction for, withholding on account of taxes, levies,
imposts, duties or other charges of whatever nature, other than
based upon the net income, gross receipts, assets or operations of
Beneficiary, except as provided for in the Supply Agreement.
Beneficiary may apply any payments received from any source against
that portion of the Guaranteed Obligations in such priority and
fashion as Beneficiary may deem appropriate, except to the extent
required under the Supply Agreement.
9. Representations and
Warranties . Each Guarantor represents and warrants
to Beneficiary that:
(a) it is duly organized and validly
existing under the laws of the jurisdiction of its incorporation
and has full power and legal right to execute and deliver this
Guaranty Agreement and to perform, or cause to be performed, the
provisions of this Guaranty Agreement on its part to be
performed;
(b) its execution, delivery and
performance of this Guaranty Agreement have been and remain duly
authorized by all necessary corporate action and do not contravene
any provision of its certificate of incorporation or bylaws or any
law, regulation or contractual restriction binding on it or its
assets;
(c) neither the execution and
delivery of this Guaranty Agreement nor the performance by
Guarantor of the terms of this Guaranty Agreement (i) will
conflict with or result in a breach, default or violation of
(A) the charter or bylaws of Guarantor or (B) any
material contract, permit or judgment to which Guarantor is a party
or to which it is subject or by which any of its assets is bound,
or (ii) will result in the creation of any lien on any
material asset of Guarantor;
(d) all consents, authorizations,
approvals and clearances and notifications, reports and
registrations requisite for the due execution, delivery and
performance of this Guaranty Agreement have been obtained from or,
as the case may be, filed with the relevant governmental
authorities having jurisdiction and remain in full force and effect
and all conditions have been duly complied with and no other action
by, and no notice to or
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