Exceed

Exceed are a race of cat-like beings that exist in Edoras as far back as 100 years prior to the main storyline. Chapter 175 reveals that Happy and Charle are members of this race. They live in the kingdom of Extalia.

Importance
The Exceed see themselves as divine rulers of the humans, guiding them according to the will of their queen. The humans of Edoras generally hold them in high regard, as seen when Erza Knightwalker and a group of soldiers bowed to Happy and Charle upon their return home. (Not knowing that the two were allied with the Earth Land mages at that time.) Presumably, this is due to the fact that they are the only beings in Edoras whose magic is located inside of their bodies, just like the mages of Earth Land.

Due to this reverence, the Exceed see themselves as angelic beings and above humans in general -- Their ruler considers herself the God of Edoras. However, the only spell they can perform is Aera and, as Byro said, the limited magic of the Exceed cannot compare with that of Earth Land's mages. This created strife when they learned that Lucy Heartfilia was in Edoras and could still use magic, thus threatening the Exceed's power. As such, their queen gave direct orders for the young mage to be executed.

However, it seems that the humans of Edoras do not truly wish to be led by the Exceed, as their king's ultimate plan, Code ETD, shows. In sending the lacrima containing Earth Land's mages on a collision course with Extalia, Faust plans to unleash an unlimited amount of magical energy to sustain his kingdom for all eternity -- And by doing so, he has declared war on the Exceed race.

Apparently the Queen's God complex has even gone to her people's heads, when Wendy Marvell tries to warn them of their doom, they arrognatly don't believe her and start throwing rocks at the "mere human" and "fallen angel".

Mission
One-hundred Exceed eggs (Including Happy and Charle) were taken from their parents and sent to Earth Land on a mission to obliterate the Dragon Slayers. When Faust began using Anima to steal magical energy from Earthland, Queen Shagotte gave the Exceed in the field new orders: To capture the Dragon Slayers and bring them to Edoras. The Dragon Slayers would then be used to create a special type of lacrima filled with Dragon Magic.

Charle decides to abandon her mission to kill Wendy and brought her to Edoras without knowing that her mission had been changed to simply lure Wendy to Edoras. She becomes very distressed by the fact that she unknowingly betrayed Wendy and fulfilled her mission. Happy is currently unable to recall the details of his mission but refuses to be a puppet of the Exceed, making it clear that he and Charle are members of Fairy Tail first and Exceed second. After this, they escape and are declared outlaws.

There is a persisting mystery, however, regarding the mission these Exceed were given: While Natsu Dragneel and Wendy Marvell have clearly met their "assassins", Gajeel Redfox has apparently had no such encounter. It is as-of-yet unknown why he hasn't met an Exceed, or even whether the majority of enlisted Exceed met their targets or not.