Exhibit
4.5
SUBSIDIARY GUARANTY
This GUARANTY (as amended,
restated, supplemented, or otherwise modified and in effect from
time to time, this “ Guaranty ”) is made as of
this ___ day of July, 2009, jointly and severally, by each of
Evolution Resources, Inc., a Delaware corporation (“ ER
Sub ”), Liquafaction Corporation, a Washington
corporation (“ Liquafaction ”), Liqua Ethanol,
LLC, a Washington limited liability company (“ Liqua
”; Liqua, ER Sub and Liquafaction, together with each other
person or entity who becomes a party to this Guaranty by execution
of a joinder in the form of Exhibit A attached hereto, is
referred to individually as a “ Guarantor ” and
collectively as the “ Guarantors ”) in favor
of Harborview
Master Fund, L.P. , a British
Virgin Islands limited partnership, on its own behalf and in its
capacity as collateral agent (together with its successors and
assigns in such capacity, the “ Collateral Agent
”) for the benefit of the entities identified on the Schedule
of Buyers attached to the Purchase Agreement defined below
(together with their successors and assigns, the “
Buyers ”).
W I T N E S S E T H:
WHEREAS, as of the date hereof, the
Buyers have made loans and certain other financial accommodations
(collectively, the “ Loans ”) to
Evolution
Resources, Inc . , a
Nevada corporation (the “ Company ”), as
evidenced by those certain secured senior notes in an original
aggregate principal amount of $215,000 (such notes, together with
any promissory notes or other securities issued in exchange or
substitution therefor or replacement thereof, and as any of the
same may be amended, supplemented, restated or modified and in
effect from time to time, the “ Notes
”);
WHEREAS, the Notes are being acquired by
the Buyers pursuant to a Securities Purchase Agreement dated as of
July __, 2009 among the Buyers and the Company (as the same may be
amended, restated, supplemented or otherwise modified from time to
time, the “ Purchase Agreement ”);
WHEREAS, pursuant to a Pledge Agreement
of even date herewith (as the same may be amended, restated,
supplemented or otherwise modified and in effect from time to time,
the “ Pledge Agreement ”) by the Company in
favor of the Collateral Agent, the Company has created a lien on
and security interest in all of the capital stock and other equity
interests of each of the Guarantors to the Collateral Agent, and
pledged such capital stock and equity interests to the Collateral
Agent, in each case, for its benefit and the benefit of the
Buyers;
WHEREAS, pursuant to a Security Agreement
of even date herewith (as the same may be amended, restated,
supplemented or otherwise modified and in effect from time to time,
the “ Security Agreement ”) by the
“Debtors” (as defined therein) in favor of the
Collateral Agent, such Debtors have granted the Collateral Agent,
for its benefit and the benefit of the Buyers, a first priority
security interest in, and lien upon and pledge of each of their
rights in the Collateral (as defined in the Security Agreement);
and
WHEREAS, the Guarantors are direct or
indirect subsidiaries of the Company and, as such, will derive
substantial benefit and advantage from the Loans and other
financial accommodations available to the Company set forth in the
Purchase Agreement, the Notes and
the other Transaction Documents, and it
will be to each Guarantor’s direct interest and economic
benefit to assist the Company in procuring said Loans and other
financial accommodations from the Buyers.
NOW, THEREFORE , for and in consideration of the premises and in
order to induce the Buyers to make the Loans, and for other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, each Guarantor hereby jointly and
severally agrees as follows:
1.
Definitions : Capitalized terms used herein without
definition and defined in the Purchase Agreement are used herein as
defined therein. In addition, as used herein:
“ Bankruptcy Code ”
shall mean the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101, et seq. ), as amended and in effect from time to
time thereunder.
“ Event of Default ”
shall have the meaning ascribed to such term in the
Notes.
“ Obligations ” shall
mean (i) all obligations, liabilities and indebtedness of every
nature of the Company from time to time owed or owing to the Buyers
and Collateral Agent, including, without limitation, all
obligations, liabilities and indebtedness of every nature of the
Company under the Security Documents, the Purchase Agreement, the
Notes, the Loans, the Warrants and the other Transaction Documents,
including, without limitation, the principal amount of all debts,
claims and indebtedness, accrued and unpaid interest and all fees,
taxes, indemnities, costs and expenses, whether primary, secondary,
direct, contingent, fixed or otherwise, heretofore, now and/or from
time to time hereafter owing, due or payable whether before or
after the filing of a bankruptcy, insolvency or similar proceeding
under applicable federal, state, foreign or other law and whether
or not an allowed claim in any such proceeding, and (ii) all
obligations, liabilities and indebtedness of every nature of the
Guarantors from time to time owed or owing to the Buyers and/or
Collateral Agent, including, without limitation, all obligations,
liabilities and indebtedness of every nature of the Guarantors
under or in respect of this Guaranty, the Pledge Agreement, the
Security Agreement, the Purchase Agreement, the Notes, the Loans,
the Warrants, the other Security Documents and the other
Transaction Documents, as the case may be, including, without
limitation, the principal amount of all debts, claims and
indebtedness, accrued and unpaid interest and all fees, taxes,
indemnities, costs and expenses, whether primary, secondary,
direct, contingent, fixed or otherwise, heretofore, now and/or from
time to time hereafter owing, due or payable whether before or
after the filing of a bankruptcy, insolvency or similar proceeding
under applicable federal, state, foreign or other law and whether
or not an allowed claim in any such proceeding.
2.
Guaranty of Payment
.
(a)
Each Guarantor, jointly and severally,
hereby unconditionally and irrevocably guaranties the full and
prompt payment and performance to the Buyers and Collateral Agent,
on behalf of itself and in its capacity as collateral agent for the
benefit of the Buyers, when due, upon demand, at maturity or by
reason of acceleration or otherwise and at all times thereafter, of
any and all of the Obligations.
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(b)
Each Guarantor acknowledges that valuable
consideration supports this Guaranty, including, without
limitation, the consideration set forth in the recitals above, as
well as any commitment to lend, extension of credit or other
financial accommodation, whether heretofore or hereafter made by
the Buyers to the Company; any extension, renewal or replacement of
any of the Obligations; any forbearance with respect to any of the
Obligations or otherwise; any cancellation of an existing guaranty;
any purchase of any of the Company’s assets by any Buyer or
Collateral Agent; or any other valuable consideration.
(c)
Each Guarantor agrees that all payments
under this Guaranty shall be made in United States currency and in
the same manner as provided for the Obligations.
(d)
Notwithstanding any provision of this
Guaranty to the contrary, it is intended that this Guaranty, and
any interests, liens and security interests granted by Guarantors
as security for this Guaranty, not constitute a “Fraudulent
Conveyance” (as defined below) in the event that this
Guaranty or such interest is subject to the Bankruptcy Code or any
applicable fraudulent conveyance or fraudulent transfer law or
similar law of any state. Consequently, Guarantors,
Collateral Agent and the Buyers agree that if this Guaranty, or any
such interests, liens or security interests securing this Guaranty,
would, but for the application of this sentence, constitute a
Fraudulent Conveyance, this Guaranty and each such lien and
security interest shall be valid and enforceable only to the
maximum extent that would not cause this Guaranty or such interest,
lien or security interest to constitute a Fraudulent Conveyance,
and this Guaranty shall automatically be deemed to have been
amended accordingly at all relevant times. For purposes
hereof, “ Fraudulent Conveyance ” means a
fraudulent conveyance under Section 548 of the Bankruptcy Code or a
fraudulent conveyance or fraudulent transfer under the provisions
of any applicable fraudulent conveyance or fraudulent transfer law
or similar law of any state, as in effect from time to
time.
3.
Costs and Expenses
.
Each Guarantor, jointly and severally,
agrees to pay on demand, all costs and expenses of every kind
incurred by any Buyer or Collateral Agent: (a) in enforcing this
Guaranty, (b) in collecting any of the Obligations from the Company
or any Guarantor, (c) in realizing upon or protecting or preserving
any collateral for this Guaranty or for payment of any of the
Obligations, and (d) in connection with any amendment of,
modification to, waiver or forbearance granted under, or
enforcement or administration of any Transaction Document or for
any other purpose in connection with any Transaction Document.
“ Costs and expenses ” as used in the
preceding sentence shall include, without limitation, reasonable
attorneys’ fees incurred by any Buyer or Collateral Agent in
retaining counsel for advice, suit, appeal, any insolvency or other
proceedings under the Bankruptcy Code or otherwise, or for any
purpose specified in the preceding sentence.
4.
Nature of Guaranty: Continuing,
Absolute and Unconditional .
(a)
This Guaranty is and is intended to be a
continuing guaranty of payment of the Obligations, and not of
collectibility, and is intended to be independent of and in
addition to any other guaranty, indorsement, collateral or other
agreement held by the Buyers or Collateral Agent therefor or with
respect thereto, whether or not furnished by a Guarantor.
None of the Buyers and Collateral Agent shall be required to
prosecute collection, enforcement or other remedies against
Company, any other Guarantor or guarantor of the Obligations or
any
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other person or entity, or to enforce or
resort to any of the Collateral or other rights or remedies
pertaining thereto, before calling on a Guarantor for payment.
The obligations of each Guarantor to repay the Obligations
hereunder shall be unconditional. Each Guarantor shall have
no right of subrogation with respect to any payments made by any
Guarantor hereunder until the termination of this Guaranty in
accordance with Section 8 below, and hereby waives any
benefit of, and any right to participate in, any security or
collateral given to the Buyers to secure payment of the
Obligations, and each Guarantor agrees that it will not take any
action to enforce any obligations of the Company to any Guarantor
prior to the Obligations being finally and irrevocably paid in full
in cash, provided that, in the event of the bankruptcy or
insolvency of the Company, Collateral Agent, for the benefit of
itself and the Buyers, and the Buyers shall be entitled
notwithstanding the foregoing, to file in the name of any Guarantor
or in its own name a claim for any and all indebtedness owing to a
Guarantor by the Company (exclusive of this Guaranty), vote such
claim and to apply the proceeds of any such claim to the
Obligations.
(b)
For the further security of the Buyers
and without in any way diminishing the liability of the Guarantors,
following the occurrence of an Event of Default, all debts and
liabilities, present or future of the Company to the Guarantors and
all monies received from the Company or for its account by the
Guarantors in respect thereof shall be received in trust for the
Buyers and Collateral Agent and forthwith upon receipt shall be
paid over to the Collateral Agent, for its benefit and in its
capacity as collateral agent for the benefit of the Buyers, until
all of the Obligations have been finally and irrevocably paid in
full in cash. This assignment and postponement is independent
of and severable from this Guaranty and shall remain in full effect
whether or not any Guarantor is liable for any amount under this
Guaranty.
(c)
This Guaranty is absolute and
unconditional and shall not be changed or affected by any
representation, oral agreement, act or thing whatsoever, except as
herein provided. This Guaranty is intended by the Guarantors
to be the final, complete and exclusive expression of the guaranty
agreement between the Guarantors and the Buyers. No
modification or amendment of any provision of this Guaranty shall
be effective against any party hereto unless in writing and signed
by a duly authorized officer of such party.
(d)
Each Guarantor hereby releases the
Company from all, and agrees not to assert or enforce (whether by
or in a legal or equitable proceeding or otherwise) any
“claims” (as defined in Section 101(5) of the
Bankruptcy Code), whether arising under any law, ordinance, rule,
regulation, order, policy or other requirement of any domestic or
foreign government or any instrumentality or agency thereof, having
jurisdiction over the conduct of its business or assets or
otherwise, to which the Guarantors are or would at any time be
entitled by virtue of its obligations hereunder, any payment made
pursuant hereto or the exercise by any Buyer or Collateral Agent of
its rights with respect to the Collateral, including any such
claims to which such Guarantors may be entitled as a result of any
right of subrogation, exoneration or reimbursement.
5.
Certain Rights and
Obligations .
(a)
Each Guarantor acknowledges and agrees
that the Buyers and Collateral Agent, for its benefit and as
collateral agent for the benefit of the Buyers, may, without
notice,
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demand or any reservation of rights
against such Guarantor and without affecting such Guarantor’s
obligations hereunder, from time to time:
(i)
renew, extend, increase, accelerate or
otherwise change the time for payment of, the terms of or the
interest on the Obligations or any part thereof or grant other
indulgences to the Company or others;
(ii)
accept from any person or entity and hold
collateral for the payment of the Obligations or any part thereof,
and modify, exchange, enforce or refrain from enforcing, or
release, compromise, settle, waive, subordinate or surrender, with
or without consideration, such collateral or any part
thereof;
(iii)
accept and hold any indorsement or
guaranty of payment of the Obligations or any part thereof, and
discharge, release or substitute any such obligation of any such
indorser or guarantor, or discharge, release or compromise any
Guarantor, or any other person or entity who has given any security
interest in any collateral as security for the payment of the
Obligations or any part thereof, or any other person or entity in
any way obligated to pay the Obligations or any part thereof, and
enforce or refrain from enforcing, or compromise or modify, the
terms of any obligation of any such indorser, guarantor, or person
or entity;
(iv)
dispose of any and all collateral
securing the Obligations in any manner as the Collateral Agent, in
its sole discretion, may deem appropriate, and direct the order or
manner of such disposition and the enforcement of any and all
endorsements and guaranties relating to the Obligations or any part
thereof as the Collateral Agent in its sole discretion may
determine;
(v)
determine the manner, amount and time of
application of payments and credits, if any, to be made on all or
any part of any component or components of the Obligations (whether
principal, interest, fees, costs, and expenses, or otherwise),
including, without limitation, the application of payments received
from any source to the payment of indebtedness other than the
Obligations even though the Buyers might lawfully have elected to
apply such payments to the Obligations to amounts which are not
covered by this Guaranty; and
(vi)
take advantage or refrain from taking
advantage of any security or accept or make or refrain from
accepting or making any composit
