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GUARANTY This Guaranty is made and given this _________, 200- by _____________________________ ("Guarantor") in favor of New York State Electric & Gas Corporation having an office located at Corporate Drive - Kirkwood Industrial Park, Binghamton, New York 13902-5224 ("NYSEG"). Guarantor enters into this Guaranty in consideration of, and as an inducement for NYSEG having entered into or entering into contracts for the sale, purchase, exchange or transportation of natural gas and/or other services related thereto pursuant to NYSEG's tariff, P.S.C. No. 88 Gas Tariff, and/or any and all gas pooling agreements (collectively, the "Contracts") with any subsidiary, and/or affiliated company of Guarantor (collectively, the "Company"). 1. Guarantor hereby unconditionally guarantees to NYSEG the prompt, faithful and full payment on demand of any obligation, indebtedness or sum that now is or may hereafter become due and payable from the Company to NYSEG in connection with the Contracts, and interest on any and all such sums, which shall accrue from the date of default at a rate of two percentage points above the published prime lending rate of The Chase Manhattan Bank, but not to exceed the maximum rate permitted by law. Guarantor further promises to pay all reasonable attorney's fees and other damages, costs, and expenses incurred by NYSEG as a result of the Company's failure to fully and faithfully pay any monies due to NYSEG in connection with Contracts covered by this Guaranty, or Guarantor's failure to fulfill its obligations under this Guaranty. In addition, Guarantor agrees to reimburse NYSEG for all sums paid to NYSEG by the Company, which sums NYSEG is subsequently required to return or repay for any reason, including, but not limited to, the Company's bankruptcy, insolvency or a requirement of any legislative enactment, proclamation or judicial proceeding providing for the postponement of the payment of debts or affecting the exercise of NYSEG's rights. (Any and all of the guaranteed obligations hereunder, including, without limitation, the Contracts, are sometimes referred to in this Guaranty as the "Obligation(s)".) 2. This Guaranty shall be a continuing guaranty of payment and not of collection. This Guaranty shall remain in full force and effect until Guarantor terminates this Guaranty by providing written notice of such termination to NYSEG (the "Termination Date"); provided, no such termination shall be effective until five (5) business days after receipt by NYSEG of such termination notice delivered consistent with Section 10, herein. No such termination shall affect Guarantor's liability with respect to any Obligation entered into prior to the time the termination is effective, which Obligation shall remain guaranteed pursuant to the terms of this Guaranty. Regardless of when NYSEG may extend or renew any pretermination Obligation, with or without modification of terms, such extended or renewed Obligation shall be deemed to be incurred prior to termination and fully covered by this Guaranty. 3. Guarantor shall pay or repay to NYSEG, free of any deductions, set-offs, claims, counterclaims or withholdings all monies due to NYSEG pursuant to this Guaranty within five (5) days after receiving written demand for payment from NYSEG. However, NYSEG shall not be required to inform Guarantor of any dishonor or default by the Company as a prerequisite to making demands on Guarantor for payment under this Guaranty or enforcing any other of NYSEG's rights and Guarantor's obligations under this Guaranty. 4. Guarantor hereby waives the giving of any notice, including, but not limited to, the following: (i) notice of acceptance of this Guaranty by NYSEG; (ii) notice that the Company has entered into, and incurred indebtedness in connection with, Obligations with NYSEG; (iii) notice of the modification or amendment of any Obligation between the Company and NYSEG; (iv) notice of any extension of time or

other modification of terms for the payment of any sums due and payable to NYSEG in connection with Obligations between the Company and NYSEG; (v) notice of presentment, demand for payment, default, dishonor, protest or notice of protest with respect to any notes, drafts or other instruments evidencing indebtedness, received from the Company to NYSEG; (vi) notice of any defaults by or disputes with the Company with respect to payment or performance in connection with Obligations between the Company and NYSEG; and, (vii) any other notice which may give rise to any defenses, offsets or counterclaims to the obligations and indebtedness of Guarantor or the Company to NYSEG. 5. Guarantor acknowledges that the modification of Obligations or any other contract agreement between the Company and NYSEG shall not discharge or otherwise affect the liability Guarantor with respect thereto under this Guaranty. Guarantor acknowledges that the obligations Guarantor under this Guaranty shall be unconditional, irrespective of the validity, regularity enforceability of any of the Obligations. or of of or

6. Guarantor hereby agrees the Obligations shall be enforceable before or after any remedies are exercised by NYSEG against the Company or against any collateral security securing any of the obligations guaranteed thereby and that NYSEG, from time to time, may: (i) extend the time of payment of the whole, or any part, of the Obligations, and may receive and accept notes, bills, checks, trade acceptances and other instruments for the payment of money, made, accepted or delivered by the Company or any other person or persons, as well as extensions or renewals thereof; (ii) take or accept collateral as security for any or all of the Obligations or release, surrender, exchange or subordinate any collateral now or hereafter securing the Obligations; (iii) fully or partially release Company or any other guarantor or obligor from liability for any or all Obligations; or (iv) adjust, indulge, forbear or waive any Obligations with the Company or any other party obligated therefor (and hereby consents to any such things heretofore done by NYSEG), without in any way releasing or discharging Guarantor from its obligations hereunder. 7. Guarantor's obligations under this Guaranty are independent of all obligations of the Company to NYSEG and shall be enforceable and effective regardless of: (i) any disability of the Company, or the dissolution, bankruptcy or insolvency of the Company, Guarantor or any other party at any time liable for the payment of any or all of the Obligations; (ii) any neglect, delay or refusal of NYSEG to take any action for the collection of the Obligations; (iii) any impairment of any collateral security; or (iv) any change in the existence or organizational structure or ownership of the Company. NYSEG shall not be required to proceed first against the Company or any other person, firm or corporation before resorting to Guarantor for payment under this Guaranty. It is further agreed that Guarantor is not nor shall Guarantor become a creditor of the Company by virtue of this Guarantee and that any payment hereunder by Guarantor to NYSEG shall not reduce any indebtedness of Guarantor to the Company nor establish a credit for Guarantor with the Company. 8. Demands on Guarantor for payment under this Guaranty shall be in writing and delivered by mail or telecommunication to the following address: (include contact name, title, phone and fax number) [Company Name] [Contact Name] [Title] [Address]


Phone: Fax: All demands for payment shall be effective immediately when received by Guarantor by fax or U.S. mail, or upon passage of three (3) business days after such demand has been sent by U.S. first class mail to Guarantor, whichever occurs first. Guarantor may change the address to which demands for payment are to be sent upon written notice to NYSEG. 9. Notices to NYSEG under this Guaranty shall be in writing and delivered by mail or telecommunication to the following person and address: New York State Electric & Gas Corporation [Name] [Title] [Address] Phone: Fax: All notices given to NYSEG shall be effective when received by the person designated herein or substitute persons designated by NYSEG. NYSEG may change the persons and/or addresses to which notices are to be sent upon written notice to Guarantor. 10. This Guaranty and each of its provisions may be waived, modified, varied, released, terminated or surrendered, in whole or in part, only by a duly authorized written instrument signed by NYSEG and Guarantor. No failure by NYSEG to exercise its rights under this Guaranty shall give rise to any estoppel against NYSEG or excuse Guarantor from performing under this Guaranty. No waiver by NYSEG of performance by Guarantor under any of the provisions of this Guaranty shall be construed as a waiver of any subsequent performance by Guarantor under the same or any other provisions of this Guaranty. 11. This Guaranty shall bind the successors and assigns of Guarantor and inure to the benefit of NYSEG, its successors and assigns. Guarantor shall not assign this Guaranty or delegate its duties hereunder without the express written consent of NYSEG. Guarantor shall remain liable under this Guaranty, notwithstanding assumption of this Guaranty by a successor or assign, unless and until released in writing from its obligations hereunder by NYSEG. Guarantor agrees that its obligations under this Guaranty shall extend to Obligations between NYSEG and any successors and assigns of the Company. 12. Guarantor represents and warrants that: (i) it is duly organized and validly existing under the laws of the jurisdiction in which it was organized and has the power and authority to execute, deliver, and perform this Guaranty; (ii) no authorization, approval, consent or order of, or registration or filing with, any court or other governmental body having jurisdiction over Guarantor is required on the part of Guarantor for the execution and delivery of this Guaranty; and; (iii) this Guaranty constitutes a valid and legally binding agreement of Guarantor, and is enforceable against Guarantor, except as the enforceability of this Guaranty may be limited by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditor's rights generally and by general principles of equity.


13. This Guaranty shall be governed by and construed in accordance with the laws of the State of New York, without regard to its principles of conflicts of laws. Guarantor irrevocably agrees that any legal action or proceeding arising under, or relating to, this Guaranty shall be brought in any state or federal court located in the State of New York, New York City, Borough of Manhattan. The Guarantor irrevocably waives any objection that it may now have or in the future have to such jurisdiction as the proper forum for any action or proceeding arising under, or relating to, this Guaranty. 14. This writing is the complete and exclusive statement of the terms of this Guaranty and supersedes all prior oral or written representations, understandings, and agreements between NYSEG and Guarantor with respect to the subject matter hereof. NYSEG and Guarantor agree that there are no conditions to the full effectiveness of this Guaranty. IN WITNESS WHEREOF, Guarantor has duly caused this Guaranty to be signed on its behalf as of the date first written above. [GUARANTOR] By:_____________________ Name: Title:

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