EXHIBIT 10.1.5

GUARANTY AGREEMENT

(ECEC)

THIS GUARANTY AGREEMENT (this “Guaranty”), dated as of June 29, 2015, is made by
EAGLE CREST ENERGY COMPANY, a California corporation (“Guarantor”), for the
benefit of CIL&D, LLC, a Delaware limited liability company (together with its
successors and assigns, “Lender”).

RECITALS

WHEREAS, Eagle Mountain Acquisition LLC, a Delaware limited liability company
(“Borrower”), is a party to that certain Purchase and Sale Agreement dated as of
June 25, 2015 (the “Purchase Agreement”) among Borrower, Lender, Eagle Mountain
LLC, a Delaware limited liability company (“Holdco”), Kaiser Eagle Mountain,
LLC, a Delaware limited liability company (“KEM”) and Guarantor, pursuant to
which, among other things, Lender agreed to sell to Borrower 100% of the
ownership interest in KEM;

WHEREAS, as partial payment of the purchase price to Lender under the Purchase
Agreement, Borrower and Lender entered into (i) that certain promissory note in
the initial principal amount of $4,250,000 (the “Senior Note”) and (ii) that
certain promissory note in the initial principal amount of $19,000,000 (the
“Junior Note” and together with, the Senior Note, the “Notes”), in each case of
even date herewith in favor of the Lender. The payment obligations under the
Senior Note are sometimes referred to herein as the “Deferred Payment”.
Collectively, the payment obligations under the Notes are sometimes referred to
herein as the “Loan”. Capitalized terms used herein without definition shall
have the meanings ascribed to such terms in the Senior Note; and

WHEREAS, the direct or indirect owners of Guarantor own a direct or indirect
interest in Borrower, and Guarantor will directly or indirectly benefit from
Lender making the Loan to Borrower.

NOW, THEREFORE, as an inducement to Lender to enter into the Purchase Agreement
and to accept the Notes, and for other good and valuable consideration, the
receipt and legal sufficiency of which are hereby acknowledged, Guarantor hereby
agrees as follows:

ARTICLE I - NATURE AND SCOPE OF GUARANTY

Section 1.1 Guaranty of Obligations. Guarantor hereby irrevocably and
unconditionally guarantees to Lender the payment and performance of the
Guaranteed Obligations as and when the same shall be due and payable. Guarantor
hereby irrevocably and unconditionally covenants and agrees that it is liable
for the Guaranteed Obligations as a primary obligor.

Section 1.2 Definition of Guaranteed Obligations. As used herein, the term
“Guaranteed Obligations” means (i) the full and timely payment and performance
of all of the obligations and liabilities of Borrower for which Borrower is, or
shall become, liable pursuant to the Senior Note, including, without limitation,
the performance of all terms, covenants, conditions, indemnities and agreements
of Borrower set forth therein, and (ii) upon the occurrence of an Event of
Default (as defined in the Senior Note), the full amount of the Loan. Without
limiting the foregoing, Guarantor shall be liable to Lender for all third party
claims, suits, liabilities, actions, proceedings, obligations, debts, actual out
of pocket damages, actual out of pocket losses, fines, penalties, charges, fees,
actual out of pocket costs and expenses (including, without limitation,
reasonable attorneys’ fees and expenses), judgments and awards arising out of or
in connection with the Guaranteed Obligations, provided the same was not caused
by or did not arise in connection with Lender’s negligence or willful
misconduct.

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Section 1.3 Nature of Guaranty. This Guaranty is an irrevocable, absolute,
continuing guaranty of payment and performance and not a guaranty of collection.
This Guaranty shall continue to be effective with respect to any Guaranteed
Obligations so long as the Senior Note is outstanding or unless Guarantor is
otherwise released from its obligations under this Guaranty pursuant to the Loan
Documents. Subject to the terms of Section 1.10 below, this Guaranty shall
automatically terminate upon the payment in full of the Senior Note, and
Guarantor shall no longer be responsible for the Guaranteed Obligations.

Section 1.4 Payment by Guarantor. Guarantor shall, immediately upon demand by
Lender, pay the amount due on the Guaranteed Obligations to Lender at Lender’s
address as set forth herein or as otherwise instructed by Lender. Such demand(s)
may be made at any time coincident with or after the time for payment of all or
any part of the Guaranteed Obligations with respect to the same or different
Guaranteed Obligations.

Section 1.5 No Duty to Pursue Others. Lender shall not be required (and
Guarantor hereby waives any rights to require Lender), in order to enforce the
obligations of Guarantor hereunder, first (i) to institute suit or otherwise
exhaust its remedies against Borrower or any other persons liable on the
Deferred Payment or the Guaranteed Obligations, or against any other person,
(ii) to enforce Lender’s rights against any collateral given to secure the
Deferred Payment, (iii) to enforce Lender’s rights against any other guarantors
of the Guaranteed Obligations, (iv) to join Borrower or any other persons liable
on the Guaranteed Obligations in any action seeking to enforce this Guaranty,
(v) to exhaust any available remedies against any collateral given to secure the
Deferred Payment, or (vi) to resort to any other means of obtaining payment or
performance of the Guaranteed Obligations.

Section 1.6 Waivers.

(a) Guarantor agrees to the provisions of the Loan Documents and hereby waives
notice of (i) acceptance of this Guaranty, (ii) any amendment, modification,
replacement or extension of any Loan Document, (iii) the execution and delivery
by Borrower and/or Lender of any other agreements, promissory notes or other
documents arising under the Loan Documents, (iv) the occurrence of any breach by
Borrower or any Event of Default under the Senior Note, (v) Lender’s transfer,
participation, componentization or other disposition of the Guaranteed
Obligations, or any part thereof, (vi) sale or foreclosure (or posting or
advertising therefor) of any collateral for the Guaranteed Obligations,
(vii) nonpayment or nonperformance, protest, notice of protest, notice of
dishonor, proof of non-payment or default by Borrower, (vii) intent to
accelerate or acceleration, or (ix) any other action taken or omitted by Lender
and any and all demands and notices of every kind in connection with this
Guaranty, the Loan Documents, and any documents or agreements evidencing,
securing or relating to any of the Guaranteed Obligations and any other
obligations hereby guaranteed. Guarantor also waives notice of or proof of
reliance by Lender upon this Guaranty.

(b) Guarantor specifically agrees that Guarantor shall not be released from
liability hereunder by any action taken by Lender including, without limitation,
a nonjudicial sale under the Loan Documents, that would afford Borrower a
defense based on California’s anti–deficiency laws, in general, and Cal. Code of
Civ. Proc. Section 580d, in specific. Without limiting the foregoing, Guarantor
expressly understands, acknowledges and agrees as follows: (X) In the event of a
nonjudicial foreclosure (through the exercise of the power of sale under the
Loan Documents): (i) Borrower would not be liable for any deficiency on the
Notes under Cal. Code of Civ. Proc. Section 580d, (ii) Guarantor’s subrogation
rights against Borrower would thereby be destroyed, Guarantor would be solely
liable for any deficiency to Lender (without recourse against Borrower), and
(iii) Guarantor would thereby be deprived of the anti–deficiency protections of
said Section 580d; (Y) Were it not for Guarantor’s knowing and intentional
waivers contained herein, the destruction of Guarantor’s subrogation rights and
anti–deficiency

 

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protections would afford Guarantor a defense to an action against Guarantor
hereunder; and (Z) Notwithstanding the foregoing, Guarantor expressly waives any
such defense to any action against Guarantor hereunder following a nonjudicial
foreclosure sale or in any other circumstance under which Guarantor’s
subrogation rights against Borrower have been destroyed.

(c) Guarantor hereby fully and completely waives, releases and relinquishes any
statute of limitations affecting any of Guarantor’s liability hereunder or the
enforcement thereof, including without limitation, any right, defense or benefit
under Cal. Code of Civ. Proc. Section 337.

(d) Guarantor expressly waives any defense or benefits arising out of any
federal or state bankruptcy, insolvency, or debtor relief laws, including
without limitation, under Section 364 or 1111(b)(2) of the United States
Bankruptcy Code.

(e) Guarantor expressly waives any and all benefits, rights and/or defenses
based on principals of suretyship and/or guaranty, including without limitation,
those benefits, rights and/or defenses which might otherwise be available to
Guarantor under Cal. Civ. Code Sections 2787 to 2855, inclusive, and 2899, 2953
and 3433, and Guarantor agrees that its obligations shall not be affected by any
circumstances which constitute a legal or equitable discharge of a guarantor or
surety.

(f) Guarantor expressly waives any and all benefits, rights and/or defenses
which might otherwise be available to Guarantor under Cal. Code of Civ. Proc.
Sections 580a, 580b, 580d and 726. In specific, but not by way of limitation,
Guarantor expressly waives any and all fair value rights under Cal. Code of Civ.
Proc. Section 580a as set forth in Bank of Southern California v. Dombrow, 39
Cal.App.4th 1457, 46 Cal.Rptr.2d 656 (4th Dist., Div. 1, 1995) (decertified).

(g) Guarantor acknowledges that Guarantor has been made aware of the provisions
of Cal. Civ. Code Section 2856, has read and understands the provisions of that
statute, has been advised by its counsel as to the scope, purpose and effect of
that statute, and based thereon, and without limiting the foregoing waivers,
Guarantor agrees to waive all suretyship rights and defenses described in Cal.
Civ. Code Sections 2856(a) through (d). Without limiting any other waivers
herein, Guarantor hereby gives the following waiver pursuant to Section 2856(d)
of the Cal. Civ. Code:

“Guarantor waives all rights and defenses arising out of an election of remedies
by the creditor, even though that election or remedies, such as a nonjudicial
foreclosure with respect to security for a guaranteed obligation, has destroyed
the guarantor’s rights of subrogation and reimbursement against the principal by
the operation of Section 580d of the Code of Civil Procedure or otherwise.”

(h) As provided in Cal. Civ. Code Section 2856(c), Guarantor makes the following
waivers of specific rights afforded under California law:

“The guarantor waives all rights and defenses that the guarantor may have
because the debtor’s debt is secured by real property. This means, among other
things:

(1) The creditor may collect from the guarantor without first foreclosing on any
real or personal property collateral pledged by the debtor.

 

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(2) If the creditor forecloses on any real property collateral pledged by the
debtor:

(A) The amount of the debt may be reduced only by the price for which that
collateral is sold at the foreclosure sale, even if the collateral is worth more
than the sale price.

(B) The creditor may collect from the guarantor even if the creditor, by
foreclosing on the real property collateral, has destroyed any right the
guarantor may have to collect from the debtor.

This is an unconditional and irrevocable waiver of any rights and defenses the
guarantor may have because the debtor’s debt is secured by real property. These
rights and defenses include, but are not limited to, any rights or defenses
based on Sections 580a, 580b, 580d, or 726 of the Code of Civil Procedure.”

(i) Guarantor acknowledges that it has relied on the advice of its own counsel
in making this Guaranty and has reviewed the waivers of rights contained herein
with its counsel. Guarantor further acknowledges that it understands and accepts
as a necessary part of this Guaranty the waivers of rights set forth above,
after reviewing the extent and effect of the waivers in this Guaranty with its
counsel.

Section 1.7 Payment of Expenses. If Guarantor fails to timely perform any
provisions of this Guaranty, Guarantor shall, immediately upon demand by Lender,
pay Lender any and all reasonable, out-of-pocket costs and expenses (including
court costs and reasonable attorneys’ fees and expenses) incurred by Lender in
the enforcement hereof or the preservation of Lender’s rights hereunder. The
covenant contained in this Section 1.7 shall survive the payment and performance
of the Guaranteed Obligations.

Section 1.8 Effect of Bankruptcy. If pursuant to any Insolvency Action (defined
below) concerning Borrower or Guarantor, Lender must rescind, restore or return
any payment or any part thereof received by Lender in satisfaction (in full or
in part) of the Guaranteed Obligations, as set forth herein, any prior release
or discharge from the terms of this Guaranty given to Guarantor by Lender shall
be without effect, and this Guaranty shall remain in full force and effect. As
used herein, “Insolvency Action” shall mean if Borrower or Guarantor (i) makes
an assignment for the benefit of creditors, (ii) has a receiver, liquidator or
trustee appointed for it, (iii) is adjudicated as bankrupt or insolvent, or if
any petition for bankruptcy, reorganization or arrangement pursuant to federal
bankruptcy law or any similar federal or state law shall be filed by or against,
consented to, solicited by, or acquiesced in by it, or (iv) has any proceeding
for its insolvency, dissolution or liquidation instituted against.

Section 1.9 Waiver of Subrogation, Reimbursement and Contribution.
Notwithstanding anything to the contrary contained in this Guaranty, Guarantor
hereby unconditionally and irrevocably waives, releases and abrogates any and
all rights it may now or hereafter have under any agreement, at law or in equity
(including, without limitation, any law subrogating Guarantor to the rights of
Lender), to assert any claim against or seek contribution, indemnification or
any other form of reimbursement from Borrower or any other party liable for
payment or performance of any or all of the Guaranteed Obligations for any
payment made by Guarantor under or in connection with this Guaranty or otherwise
until the Loan is paid in full.

Section 1.10 Reinstatement of Guaranty in Certain Circumstances. Guarantor
agrees that, if any or all of a payment made by or on behalf of Borrower of any
Guaranteed Obligation is returned by any person at any time for any reason
during the period one (1) year from the date of such payment, including pursuant
to any settlement, order (whether or not final) of a court of competent
jurisdiction, applicable law or because of acts or omissions of Borrower (other
than by reason of the full and indefeasible payment of the Guaranteed
Obligations), the Guaranteed Obligations will not be deemed to

 

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have been satisfied to the extent of the returned payment and the obligations of
Guarantor hereunder will be deemed to be reinstated automatically and to
continue in full force and effect. If Borrower ceases to be liable to Lender for
any of the Borrower’s obligations under the Senior Note (other than by reason of
the full and indefeasible payment of the Borrower’s obligations under the Senior
Note, cancellation or termination of the Borrower’s obligations under the Senior
Note), then any prior release or discharge from this Guaranty will be without
effect and this Guaranty and the obligations of Guarantor hereunder will be
automatically reinstated and continue in full force and effect.

Section 1.11 Borrower. The term “Borrower” as used herein shall include any new
or successor corporation, association, partnership (general or limited), limited
liability company, joint venture, trust or other individual or organization
formed as a result of any merger, reorganization, sale, transfer, assignment,
devise, gift or bequest of or by Borrower or any interest in Borrower or the
Deferred Payment.

ARTICLE II - EVENTS AND CIRCUMSTANCES NOT

REDUCING OR DISCHARGING GUARANTOR’S OBLIGATIONS

Section 2.1 Events and Circumstances Not Reducing or Discharging Guarantor’s
Obligations. Guarantor hereby consents and agrees to each of the following and
agrees that Guarantor’s obligations hereunder shall not be released, diminished,
impaired, reduced or adversely affected in any way by any of the following, and
waives any common law, equitable, statutory or other rights (including, without
limitation, rights to notice) which Guarantor might have in connection with any
of the following:

(a) Modifications, Releases, Etc. Any renewal, extension, increase, reduction,
modification, alteration or rearrangement of all or any part of the Guaranteed
Obligations, any Loan Document, or any other document or agreement between
Borrower and Lender or any other parties pertaining to the Guaranteed
Obligations.

(b) Condition of Borrower or Guarantor. The existence of an Insolvency Action
concerning Borrower, Guarantor or any other party liable for the payment or
performance of all or part of the Guaranteed Obligations, or any dissolution of
Borrower or Guarantor or any sale, lease or transfer of any or all of the assets
of Borrower or Guarantor, or any changes in the shareholders, partners or
members of Borrower or Guarantor, or any merger, consolidation, or
reorganization of Borrower or Guarantor into or with any other person.

(c) Invalidity, Unenforceability, Offset, Etc. The invalidity, illegality or
unenforceability of all or any part of the Guaranteed Obligations or any Loan
Document, or of any other document or agreement executed in connection with the
Guaranteed Obligations for any reason whatsoever, including, without limitation,
the fact that (i) the Guaranteed Obligations or any part thereof exceeds the
amount permitted by law, (ii) the act of creating the Guaranteed Obligations or
any part thereof is ultra vires, (iii) the officers or representatives executing
the Loan Documents or otherwise creating the Guaranteed Obligations acted in
excess of their authority, (iv) the Guaranteed Obligations violate applicable
usury laws, (v) Borrower has valid defenses (except the defense of payment or
performance of the applicable Guaranteed Obligations), claims or offsets
(whether at law, in equity or by agreement) which render the Guaranteed
Obligations wholly or partially uncollectible from Borrower, and whether such
defense, claim, or right of offset arises in connection with the Guaranteed
Obligations, the transactions creating same, or otherwise (including any defense
based upon any statute or rule of law which provides that the obligation of a
surety must be neither larger in amount nor in other respects more burdensome
than that of the principal and any defense of the statute of limitations in any
action hereunder or in any action for the collection or performance of any
obligations hereby guaranteed), (vi) the creation, performance or repayment of
the Guaranteed Obligations (or the execution, delivery and performance of

 

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any document or instrument representing part of the Guaranteed Obligations, or
executed in connection with the Guaranteed Obligations, or given to secure the
repayment or performance of the Guaranteed Obligations) is illegal,
uncollectible or unenforceable, (vii) any Loan Document has been forged, or is
not genuine or authentic, it being agreed that Guarantor shall remain liable
hereunder regardless of whether Borrower or any other person be found not liable
on the Guaranteed Obligations or any part thereof for any reason, or (viii) any
collateral, security, security interest or lien contemplated or intended to be
given, created or granted as security for the repayment or performance of the
Guaranteed Obligations, or any part thereof, shall not be properly perfected or
created, or shall prove to be unenforceable or subordinate to any other security
interest or lien, it being acknowledged and agreed by Guarantor that Guarantor
is not entering into this Guaranty in reliance on, or in contemplation of the
benefits of, the validity, enforceability, collectability or value of any of the
collateral for the Guaranteed Obligations.

(d) Care and Diligence. The failure of Lender or any other party to exercise
diligence or reasonable care (other than willful malfeasance) in the
preservation, protection, enforcement, sale or other handling or treatment of
all or any part of any collateral, property or security, including, without
limitation, any neglect, delay, omission, failure or refusal of Lender (i) to
take or prosecute any action for the collection of any of the Guaranteed
Obligations, (ii) to foreclose, or initiate any action to foreclose, or, once
commenced, prosecute to completion any action to foreclose upon any security
therefor, or (iii) to take or prosecute any action in connection with any
instrument or agreement evidencing or securing all or any part of the Guaranteed
Obligations.

(e) Preference. Any payment by Borrower to Lender is held to constitute a
preference under bankruptcy laws or for any reason Lender is required to refund
or remit any such payment or amount to Borrower or any other person.

(f) Other Actions Taken or Not Taken. Any other action taken or not taken with
respect to the Loan Documents, the Guaranteed Obligations, or the security and
collateral therefor, whether or not such action or inaction prejudices Guarantor
or increases the likelihood that Guarantor will be required to pay the
Guaranteed Obligations pursuant to the terms hereof.

ARTICLE III - REPRESENTATIONS AND WARRANTIES

Section 3.1 Representations and Warranties. To induce Lender to enter into the
Notes and the Loan Documents and to make the Loan, Guarantor represents and
warrants to Lender that: (a) Guarantor will receive a direct or indirect benefit
from the making of the Loan to Borrower; (b) Guarantor is familiar with, and has
independently reviewed books and records regarding, the financial condition of
Borrower and any and all collateral intended to be given as security for the
payment of the Deferred Payment; (c) after giving effect to this Guaranty,
Guarantor is and will remain solvent; (d) the execution, delivery and
performance by Guarantor of this Guaranty and the consummation of the
transactions contemplated hereunder do not and will not contravene or conflict
with any law, statute or regulation to which Guarantor is subject, or constitute
a default (or which with notice, or lapse of time, or both, would constitute a
default) under, or result in the breach of, any indenture, mortgage, charge,
lien, or any contract or agreement to which Guarantor is a party or which may be
applicable to Guarantor; (e) no approval, authorization, order, license or
consent of, or registration or filing with, any governmental authority or other
person, and no approval, authorization or consent of any other person is
required in connection with this Agreement; (f) there are no actions, suits or
proceedings at law or in equity by or before any governmental authority or other
agency now pending and served or, to Guarantor’s knowledge, threatened,
involving or concerning Guarantor, (g) this Guaranty is a legal, valid and
binding obligation of Guarantor, and is enforceable in accordance with its
terms, except as may be limited by principles of equity, bankruptcy, insolvency
or other laws of general application relating to the enforcement of creditors’
rights, and (h) the individual executing this Guaranty has been duly authorized
by the all necessary corporate, company, trust or individual actions and
consents, as applicable.

 

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Section 3.2 Additional Provisions. Without limiting anything set forth in
Section 3.1 above, Guarantor hereby represents, warrants, covenants and agrees
as follows:

(a) Guarantor (i) is a California corporation in good standing, whose principal
place of business is located at 3000 Ocean Park Boulevard, Suite 1020, Santa
Monica, CA 90405 and (ii) has the requisite power to execute and deliver, and
perform its obligations under, this Guaranty and any other Loan Document to
which it is a party.

(b) The execution and delivery by Guarantor of this Guaranty and any other Loan
Document to which it is a party, and Guarantor’s performance of its obligations
thereunder (i) will not violate any provision of any applicable legal
requirements, and (ii) will not be in conflict with, result in a breach of, or
constitute (with due notice or lapse of time or both) a default under, or result
in the creation or imposition of any lien of any nature whatsoever upon any of
the property or assets of Guarantor pursuant to, any indenture or agreement or
instrument. This Guaranty and the other Loan Documents to which Guarantor is a
party have been duly executed and delivered by Guarantor.

ARTICLE IV - SUBORDINATION OF CERTAIN INDEBTEDNESS

Section 4.1 Subordination of All Guarantor Claims. As used herein, the term
“Guarantor Claims” shall mean any and all debts and liabilities of Borrower owed
to Guarantor, whether now existing or hereafter incurred, including, without
limitation, (i) all rights and claims of Guarantor against Borrower (arising as
a result of subrogation or otherwise) as a result of Guarantor’s payment or
performance of all or any portion of the Guaranteed Obligations, or (ii) any
claim arising out of or related to the Purchase Agreement. During the
continuance of an Event of Default under the Senior Note, without limiting the
provisions of Section 1.9, Guarantor hereby subordinates its rights to receive
any payment from Borrower on account of any Guarantor Claims to the full payment
of the Deferred Payment payable to Lender. Following the occurrence of an Event
of Default under the Senior Note, Guarantor shall not demand, receive or
collect, directly or indirectly, from Borrower or any other party, and shall not
claim any offset or other reduction of Guarantor’s obligations hereunder because
of, any amount pursuant to or in satisfaction of the Guarantor Claims until the
Deferred Payment is paid in full.

Section 4.2 Claims in Bankruptcy. In the event of an Insolvency Action involving
Guarantor as debtor, Lender shall have the right to prove its claim in any such
proceeding so as to establish its rights hereunder and receive directly from the
receiver, trustee or other court custodian dividends and payments which would
otherwise be payable pursuant to or in satisfaction of Guarantor Claims.
Guarantor hereby assigns any and all such dividends and payments to Lender.

Section 4.3 Payments Held in Trust. If, notwithstanding anything to the contrary
contained in this Guaranty, Guarantor should receive any funds, payment, claim
or distribution which is prohibited hereunder, Guarantor covenants and agrees to
hold in trust for Lender an amount equal to the amount of all funds, payments,
claims or distributions so received, and Guarantor acknowledges and agrees that
it shall have absolutely no dominion over the amount of such funds, payments,
claims or distributions so received, except to pay them promptly to Lender, and
Guarantor hereby covenants and agrees promptly to pay the same to Lender.

Section 4.4 Liens Subordinate; Standstill. Guarantor acknowledges and agrees
that until the Deferred Payment is paid in full or the Guarantor has otherwise
been released from the Guarantor Obligations pursuant to the terms of the Loan
Documents, any liens, security interests, judgment liens,

 

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charges or other encumbrances upon Borrower’s assets securing payment of the
Guarantor Claims shall be and remain inferior and subordinate to any liens,
security interests, judgment liens, charges or other encumbrances upon
Borrower’s assets securing payment or performance of the Guaranteed Obligations,
regardless of whether such encumbrances in favor of Guarantor or Lender
presently exist or are hereafter created or attach. Until the Deferred Payment
is paid in full, Guarantor shall not (i) exercise or enforce any creditor’s
right it may have against Borrower, or (ii) foreclose, repossess, sequester or
otherwise take steps or institute any action or proceedings (judicial or
otherwise, including, without limitation, the commencement of, or joinder in,
any liquidation, bankruptcy, rearrangement, debtor’s relief or insolvency
proceeding) to enforce any liens, mortgages, deeds of trust, security interests,
collateral rights, judgments or other encumbrances on assets of Borrower held by
Guarantor.

ARTICLE V - MISCELLANEOUS

Section 5.1 Waiver. No failure to exercise, and no delay in exercising, on the
part of Lender, any right hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right. The rights of Lender hereunder shall
be in addition to all other rights provided by law. No notice or demand given in
any case shall constitute a waiver of the right to take other action in the
same, similar or other instances without such notice or demand.

Section 5.2 Notices. All notices, consents, approvals, demands and requests
required or permitted hereunder shall be given in writing and shall be effective
for all purposes if hand delivered or sent by (a) hand delivery, with proof of
attempted delivery, (b) certified or registered United States mail, postage
prepaid, (c) expedited prepaid delivery service, either commercial or United
States Postal Service, with proof of attempted delivery, or (d) by telecopier
(with answerback acknowledged) provided that such telecopied notice must also be
delivered by one of the means set forth in (a), (b) or (c) above, addressed to
the parties as follows:

 

If to Lender: CIL&D, LLC 337 N. Vineyard Ave., 4th Floor Ontario, CA 91764
Attention: Richard E. Stoddard Facsimile No.: 909.944.6605 with a copy to:
CIL&D, LLC 337 N. Vineyard Ave., 4th Floor Ontario, CA 91764 Attention: Terry
Cook Facsimile No.: 909.944.6605 and with a copy to: Bryan Cave LLP 88 Wood
Street London EC2V 7AJ England Attention: Carol Osborne Facsimile No.: 44 20
3207 1881

 

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If to Guarantor: Eagle Crest Energy Company 3000 Ocean Park Blvd, Suite 1020
Santa Monica, CA 90405 Attention: J. Douglas Divine Facsimile: 310.450.9494 with
a copy to: Latham & Watkins LLP 355 S. Grand Ave Los Angeles, CA 90071-1560
Attention: Kevin Ehrhart Facsimile: 213.891.8763 and with a copy to: Wexford
Capital LP 411 West Putnam Ave. Grenwich, CT 06830 Attention: Antony Lundy
Email: tlundy@wexford.com Attention: Arthur Amron Email: aamron@wexford.com
Facsimile: 203.863.7312

A party receiving a notice which does not comply with the technical requirements
for notice under this Section 5.2 may elect to waive any deficiencies and treat
the notice as having been properly given. A notice shall be deemed to have been
given: (a) in the case of hand delivery, at the time of delivery; (b) in the
case of registered or certified mail, when delivered or the first attempted
delivery on a business day; (c) in the case of expedited prepaid delivery upon
the first attempted delivery on a business day; or (d) in the case of
telecopier, upon receipt of answerback confirmation, provided that such
telecopied notice was also delivered as required in this Section 5.2.

Section 5.3 Governing Law; Submission to Jurisdiction.

(a) This Guaranty shall be interpreted and enforced according to the laws of the
State of California (without giving effect to rules regarding conflict of laws).

(b) Guarantor hereby consents and submits to the exclusive jurisdiction and
venue of any state or federal court sitting in the State of California with
respect to any legal action or proceeding arising with respect to this Guaranty
and waives all objections which it may have to such jurisdiction and venue.

Section 5.4 Severability. Wherever possible, each provision of this Guaranty
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.

Section 5.5 Modification; Waiver in Writing. No modification, amendment,
extension, discharge, termination (except as provided in Section 1.3, above) or
waiver of any provision of this Guaranty, nor consent to any departure by
Guarantor therefrom, shall in any event be effective unless the same shall
(i) be in a writing signed by the party against whom enforcement is sought, and
(ii) specifically refer to this Agreement. Any such modification, amendment,
extension, discharge, termination or waiver shall be effective only in the
specific instance, and for the purpose, for which given. Except as otherwise
expressly provided herein, no notice to, or demand on Guarantor, shall entitle
Guarantor to any other or future notice or demand in the same, similar or other
circumstances.

 

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Section 5.6 Number and Gender. All references to sections and exhibits are to
sections and exhibits in or to this Guaranty unless otherwise specified. Unless
otherwise specified, the words “hereof,” “herein” and “hereunder” and words of
similar import when used in this Guaranty shall refer to this Guaranty as a
whole and not to any particular provision, article, section or other subdivision
of this Guaranty. Unless otherwise specified, all meanings attributed to defined
terms herein shall be equally applicable to both the singular and plural forms
of the terms so defined. Whenever the context may require, any pronouns used
herein shall include the corresponding masculine, feminine or neuter forms, and
the singular form of nouns and pronouns shall include the plural and vice versa.

Section 5.7 Headings, Etc. The headings and captions of various paragraphs of
this Guaranty are for the convenience of reference only and are not to be
construed as defining or limiting, in any way, the scope or intent of the
provisions hereof.

Section 5.8 Counterparts. This Guaranty may be executed in several counterparts,
each of which counterparts shall be deemed an original instrument and all of
which together shall constitute a single Guaranty. The failure of any party
hereto to execute this Guaranty, or any counterpart hereof, shall not relieve
the other signatories from their obligations hereunder.

Section 5.9 Rights and Remedies. If Guarantor becomes liable for any
indebtedness owing by Borrower to Lender, by endorsement or otherwise, other
than pursuant to this Guaranty, such liability shall not be in any manner
impaired or affected hereby, and the rights of Lender hereunder shall be
cumulative of any and all other rights that Lender may ever have against
Guarantor. The exercise by Lender of any right or remedy hereunder or under any
other instrument, or at law or in equity, shall not preclude the concurrent or
subsequent exercise of any other right or remedy. No failure or delay on the
part of Lender in exercising any right, power or remedy hereunder shall operate
as a waiver of the exercise of the same or any other right at any other time;
nor shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy hereunder.

Section 5.10 Entire Agreement. This Guaranty and the other Loan Documents embody
the final, entire agreement of Guarantor and Lender with respect to the
Guarantor’s guaranty of the Guaranteed Obligations and supersedes any and all
prior commitments, agreements, representations, and understandings, whether
written or oral, relating to the subject matter hereof. This Guaranty is
intended by Guarantor and Lender as a final and complete expression of the terms
of the Guaranty, and no course of dealing between Guarantor and Lender, no
course of performance, no trade practices, and no evidence of prior,
contemporaneous or subsequent oral agreements or discussions or other extrinsic
evidence of any nature shall be used to contradict, vary, supplement or modify
any term of this Guaranty. There are no oral agreements between Guarantor and
Lender.

Section 5.11 Recitals. Each of the Recitals set forth at the beginning of this
Guaranty are true and correct and are incorporated herein by reference.

[Signatures begin on the following page]

 

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IN WITNESS WHEREOF, the undersigned has executed this Guaranty as of the day and
year first above written.

 

WITNESS GUARANTOR:

/s/

EAGLE CREST ENERGY COMPANY, a California corporation By:

/s/ Steve Lowe

Name:

Steve Lowe

Title: Authorized Person

Eagle Crest Energy Company Guaranty