SUBSIDIARIES GUARANTY
SUBSIDIARIES
GUARANTY (as amended, modified, restated and/or supplemented
from time to time, this “
Guaranty ”),
dated as of September 12, 2007, made by and among each of the
undersigned guarantors (each, a “
Guarantor ”
and, together with any other entity that becomes a guarantor
hereunder pursuant to Section 22 hereof, collectively, the
“
Guarantors ”)
in favor of Plainfield Special Situations Master Fund Limited, as
Administrative Agent (together with any successor administrative
agent, the “
Administrative Agent ”),
for the benefit of the Secured Creditors (as defined below). Except
as otherwise defined herein, all capitalized terms used herein and
defined in the Loan Agreement (as defined below) shall be used
herein as therein defined.
WHEREAS,
Pure Biofuels Corp. (“Holdings”), Pure Biofuels
Del Peru S.A.C. (“
Pure Biofuels ”),
Palma Industrial S.A.C. (“
Palma ”
and, together with Pure Biofuels, collectively,
the “
Borrowers ”),
the lenders from time to time party thereto (the “
Lenders ”),
Plainfield Special Situations Master Fund Limited, as Lead
Arranger, and the Administrative Agent, have entered into a Loan
Agreement, dated as of September 12, 2007 (as amended, modified,
restated and/or supplemented from time to time, the “
Loan Agreement ”),
providing for the making of Loans to the Borrower, all as
contemplated therein (the Lenders, the Administrative Agent and the
Pledgee are herein called the “ Secured
Creditors
”);
WHEREAS,
each Guarantor is a direct or indirect Subsidiary of one of
the Borrowers;
WHEREAS,
it is a condition precedent to the making of Loans to the
Borrowers under the Loan Agreement that each Guarantor shall
have executed and delivered to the Administrative Agent this
Guaranty; and
WHEREAS,
each Guarantor will obtain benefits from the incurrence of
Loans by the Borrowers under the Loan Agreement and,
accordingly, desires to execute this Guaranty in order to
satisfy the condition described in the preceding paragraph and
to induce the Lenders to make Loans to the
Borrowers;
NOW,
THEREFORE, in consideration of the foregoing and other
benefits accruing to each Guarantor, the receipt and
sufficiency of which are hereby acknowledged, each Guarantor
hereby makes the following representations and warranties to
the Administrative Agent for the benefit of the Secured
Creditors and hereby covenants and agrees with each other
Guarantor and the Administrative Agent for the benefit of the
Secured Creditors as follows:
1. GUARANTY .
(a)
Each
Guarantor, jointly and severally, irrevocably, absolutely and
un-conditionally guarantees as a primary obligor and not merely as
surety to the Secured Creditors the full and prompt payment when
due (whether at the stated maturity, by required prepayment,
declaration, acceleration, demand or otherwise) of (x) the
principal of, premium, if any, and interest on the Notes issued by,
and the Loans made to, each of the Borrowers under the Loan
Agreement, and (y) all other obligations (including, without
limitation, obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due),
liabilities and indebtedness owing by each of the Borrowers to the
Secured Creditors under each Loan Document to which the Borrower is
a party (including, without limitation, indemnities, fees and
interest thereon (including, without limitation, any interest
accruing after the commencement of any bankruptcy, insolvency,
receivership or similar proceeding at the rate provided for in the
Loan Agreement, whether or not such interest is an allowed claim in
any such proceeding)), whether now existing or hereafter incurred
under, arising out of or in connection with each such Loan Document
and the due performance and compliance by each of the Borrowers
with all of the terms, conditions, covenants and agreements
contained in all such Loan Documents (all such principal, premium,
interest, liabilities, indebtedness and obligations under this
clause (a), being herein collectively called the “
Guaranteed
Obligations
”).
Each
Guarantor understands, agrees and confirms that the Secured
Creditors may enforce this Guaranty up to the full amount of
the Guaranteed Obligations against such Guarantor without
proceeding against any other Guarantor, either Borrower, or
against any security for the Guaranteed Obligations, or under
any other guaranty covering all or a portion of the Guaranteed
Obligations. This Guaranty is a guaranty of prompt payment and
performance and not of collection.
(b)
Additionally, each Guarantor, jointly and severally,
unconditionally, absolutely and irrevocably, guarantees the
payment of any and all Guaranteed Obligations whether or not
due or payable by the Borrowers upon the occurrence in respect
of either Borrower of any of the events specified in Section
11.05 of the Loan Agreement, and unconditionally, absolutely
and irrevocably, jointly and severally, promises to pay such
Guaranteed Obligations to the Secured Creditors, or order, on
demand.
2.
LIABILITY OF GUARANTORS ABSOLUTE .
The
liability of each Guarantor hereunder is primary, absolute, joint
and several, and unconditional and is exclusive and independent of
any security for or other guaranty of the indebtedness of the
Borrowers whether executed by such Guarantor, any other Guarantor
or by any other party, and the liability of each Guarantor
hereunder shall not be affected or impaired by any circumstance or
occurrence whatsoever, including, without limitation: (a) any
direction as to application of payment by the Borrowers, or any
other party, (b) any other continuing or other guaranty,
undertaking or maximum liability of a Guarantor or of any other
party as to the Guaranteed Obligations, (c) any pay-ment on or in
reduction of any such other guaranty or undertaking, (d) any
dissolution, termination or increase, decrease or change in
personnel by either Borrower, (e) the failure of the Guarantor to
receive any benefit from or as a result of its execution, delivery
and performance of this Guaranty, (f) any payment made to any
Secured Creditor on the indebtedness which any Secured Creditor
repays a Borrower pursuant to court order in any bankruptcy,
reorganization, arrangement, mora-torium or other debtor relief
proceeding, and each Guarantor waives any right to the deferral or
modification of its obligations hereunder by reason of any such
proceeding, (g) any action or inaction by the Secured
Creditors as contemplated in Section 5 hereof or (h) any
invalidity, rescission, irregularity or unenforceability of all or
any part of the Guaranteed Obligations or of any security
therefor.
3.
OBLIGATIONS OF GUARANTORS INDEPENDENT .
The
obligations of each Guarantor hereunder are independent of the
obligations of any other Guarantor, any other guarantor, the
Borrowers, and a separate action or actions may be brought and
prosecuted against each Guarantor whether or not action is brought
against any other Guarantor, any other guarantor or either Borrower
and whether or not any other Guarantor, any other guarantor or
either Borrower be joined in any such action or actions. Each
Guarantor waives (to the fullest extent permitted by applicable
law) the benefits of any statute of limitations affecting its
liability hereunder or the enforcement thereof. Any payment by the
Borrowers or other circumstance which operates to toll any statute
of limitations as to the Borrowers shall operate to toll the
statute of limitations as to each Guarantor.
4. WAIVERS BY GUARANTORS
.
(a)
Each
Guarantor hereby waives (to the fullest extent permitted by
applicable law) notice of acceptance of this Guaranty and
notice of the existence, creation or incurrence of any new or
additional liability to which it may apply, and waives
promptness, diligence, presentment, demand of pay-ment, demand
for performance, protest, notice of dishonor or nonpayment of
any such liabilities, suit or taking of other action by the
Administrative Agent or any other Secured Creditor against,
and any other notice to, any party liable thereon (including
such Guarantor, any other Guarantor, any other guarantor or
the Borrowers) and each Guarantor further hereby waives any
and all notice of the creation, renewal, extension or accrual
of any of the Guaranteed Obligations and notice or proof of
reliance by any Secured Creditor upon this Guaranty, and the
Guaranteed Obligations shall conclusively be deemed to have
been created, contracted or incurred, or renewed, extended,
amended, modified, supplemented or waived, in reliance upon
this Guaranty.
(b)
Each
Guarantor waives any right to require the Secured Creditors
to: (i) proceed against the Borrowers, any other
Guarantor, any other guarantor of the Guaranteed Obligations
or any other party; (ii) proceed against or exhaust any
security held from the Borrowers, any other Guarantor, any
other guarantor of the Guaranteed Obligations or any other
party; or (iii) pursue any other remedy in the Secured
Creditors’ power whatsoever. Each Guarantor waives any
defense based on or arising out of any defense of the
Borrowers, any other Guarantor, any other guarantor of the
Guaranteed Obligations or any other party other than payment
in full in cash of the Guaranteed Obligations, including,
without limitation, any defense based on or arising out of the
disability of either Borrower, any other Guarantor, any other
guarantor of the Guaranteed Obligations or any other party, or
the unenforceability of the Guaranteed Obligations or any part
thereof from any cause, or the cessation from any cause of the
liability of the Borrowers other than payment in full in cash
of the Guaranteed Obligations. The Secured Creditors may, at
their election, foreclose on any collateral serving as
security held by the Administrative Agent or the other Secured
Creditors by one or more judicial or nonjudicial sales,
whether or not every aspect of any such sale is commercially
reason-able (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the
Secured Creditors may have against the Borrowers or any other
party, or any security, without affecting or impairing in any
way the liability of any Guarantor hereunder except to the
extent the Guaranteed Obligations have been paid in full in
cash. Each Guarantor waives any defense arising out of any
such election by the Secured Creditors, even though such
election operates to impair or extinguish any right of
reimbursement, contribution, indemnification or subrogation or
other right or remedy of such Guarantor against the Borrowers,
any other guarantor of the Guaranteed Obligations or any other
party or any security.
(c)
Each
Guarantor has knowledge and assumes all responsibility for
being and keeping itself informed of the Borrowers’, and
each other Guarantor’s financial condition, affairs and
assets, and of all other circumstances bearing upon the risk
of nonpayment of the Guaranteed Obligations and the nature,
scope and extent of the risks which such Guarantor assumes and
incurs hereunder, and has adequate means to obtain from the
Borrowers, and each other Guarantor on an ongoing basis
information relating thereto and the Borrowers’, and
each other Guarantor’s ability to pay and perform its
respective Guaranteed Obligations, and agrees to assume the
responsibility for keeping, and to keep, so informed for so
long as this Guaranty is in effect. Each Guarantor
acknowledges and agrees that (x) the Secured Creditors shall
have no obligation to investigate the financial condition or
affairs of either Borrower or any other Guarantor for the
benefit of such Guarantor nor to advise such Guarantor of any
fact respecting, or any change in, the financial condition,
assets or affairs of either Borrower or any other Guarantor
that might become known to any Secured Creditor at any time,
whether or not such Secured Creditor knows or believes or has
reason to know or believe that any such fact or change is
unknown to such Guarantor, or might (or does) increase the
risk of such Guarantor as guarantor hereunder, or might (or
would) affect the willingness of such Guarantor to continue as
a guarantor of the Guaranteed Obligations hereunder and (y)
the Secured Creditors shall have no duty to advise any
Guarantor of information known to them regarding any of the
aforementioned circumstances or risks.
(d)
Each
Guarantor hereby acknowledges and agrees that no Secured
Creditor nor any other Person shall be under any obligation
(a) to marshal any assets in favor of such Guarantor or in
payment of any or all of the liabilities of either Borrower
under the Loan Documents or the obligation of such Guarantor
hereunder or (b) to pursue any other remedy that such
Guarantor may or may not be able to pursue itself any right to
which such Guarantor hereby waives.
(e)
Each
Guarantor warrants and agrees that each of the waivers set
forth in Section 3 and in this Section 4 is made with full
knowledge of its significance and consequences and that if any
of such waivers are determined to be contrary to any
applicable law or public policy, such waivers shall be
effective only to the maximum extent permitted by applicable
law.
5.
RIGHTS OF SECURED CREDITORS .
Subject
to Section 4, any Secured Creditor may (except as shall be required
by applicable statute and cannot be waived) at any time and from
time to time without the consent of, or notice to, any Guarantor,
without incurring responsibility to such Guarantor, without
impairing or releasing the obligations or liabilities of such
Guarantor hereunder, upon or without any terms or conditions and in
whole or in part:
(a)
change the manner, place or terms of payment of, and/or change,
increase or extend the time of payment of, renew, increase,
accelerate or alter, any of the Guaranteed Obligations (including,
without limitation, any increase or decrease in the rate of
interest thereon or the principal amount thereof), any security
therefor, or any liability incurred directly or indirectly in
respect thereof, and the guaranty herein made shall apply to the
Guaranteed Obligations as so changed, extended, increased,
accelerated, renewed or altered;
(b)
take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, impair, realize
upon or otherwise deal with in any manner and in any order any
property or other collateral by whomsoever at any time pledged or
mortgaged to secure, or howsoever securing, the Guaranteed
Obligations or any liabilities (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof,
and/or any offset thereagainst;
(c)
exercise or refrain from exercising any rights against the
Borrowers, any other Credit Party, any Subsidiary thereof, any
other guarantor of the Borrowers or others or otherwise act or
refrain from acting;
(d)
release or substitute any one or more endorsers, Guarantors, other
guarantors, the Borrowers or other obligors;
(e)
settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and may subordinate the payment of all or any part thereof
to the payment of any liability (whether due or not) of the
Borrowers to creditors of either Borrower other than the Secured
Creditors;
(f)
apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrowers to the Secured Creditors
regardless of what liabilities of the Borrowers remain
unpaid;
(g)
consent to or waive any breach of, or any act, omission or default
under, any of the Loan Documents or any of the instruments or
agreements referred to therein, or otherwise amend, modify or
supplement any of the Loan Documents or any of such other
instruments or agreements;
(h)
act or fail to act in any manner which may deprive such Guarantor
of its right to subrogation against the Borrowers to recover full
indemnity for any payments made pursuant to this Guaranty;
and/or
(i)
take any other action or omit to take any other action which would,
under otherwise applicable principles of common law, give rise to a
legal or equitable discharge of such Guarantor from its liabilities
under this Guaranty (including, without limitation, any action or
omission whatsoever that might otherwise vary the risk of such
Guarantor or constitute a legal or equitable defense to or
discharge of the liabilities of a guarantor or surety or that might
otherwise limit recourse against such Guarantor).
No
invalidity, illegality, irregularity or unenforceability of
all or any part of the Guaranteed Obligations, the Loan
Documents or any other agreement or instrument relating to the
Guaranteed Obligations or of any security or guarantee
therefor shall affect, impair or be a defense to this
Guaranty, and this Guaranty shall be primary, absolute and
unconditional notwithstanding the occurrence of any event or
the existence of any other circumstances which might
constitute a legal or equitable discharge of a surety or
guarantor except payment in full in cash of the Guaranteed
Obligations.
6.
CONTINUING GUARANTY .
This
Guaranty is a continuing one and all liabilities to which it
applies or may apply under the terms hereof shall be conclusively
presumed to have been created in reliance hereon. No failure or
delay on the part of any Secured Creditor in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights
and remedies herein expressly specified are cumulative and not
exclusive of any rights or remedies which any Secured Creditor
would otherwise have. No notice to or demand on any Guarantor in
any case shall entitle such Guarantor to any other further notice
or demand in similar or other circumstances or constitute a
waiver
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