FIRST AMENDMENT TO CREDIT AGREEMENT
Exhibit 10.2
Execution Version
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is dated as of July 1,
2011, and is made by and among XXXXXXXXX COAL COMPANY, INC., a Delaware corporation, XXXXXXXXX LAND
COMPANY, LLC, a Delaware limited liability company, WESTERN MINERAL DEVELOPMENT, LLC, a Delaware
limited liability company, WESTERN DIAMOND LLC, a Nevada limited liability company, WESTERN LAND
COMPANY, LLC, a Kentucky limited liability company, and ELK CREEK, L.P., a Delaware limited
partnership (each a “Borrower” and collectively, the “Borrowers”), the GUARANTORS
PARTY HERETO (individually a “Guarantor” and collectively, the “Guarantors”, and
together with the Borrowers, the “Loan Parties”), the FINANCIAL INSTITUTIONS PARTY HERETO
(individually a “Lender” and collectively, the “Lenders”) and PNC BANK, NATIONAL
ASSOCIATION, in its capacity as administrative agent for the Lenders (the “Administrative
Agent”).
RECITALS:
WHEREAS, the Loan Parties, the Lenders and the Administrative Agent are parties to that
certain Credit Agreement, dated as of February 9, 2011 (the “Credit Agreement”);
WHEREAS, the Loan Parties desire to conduct certain equity offerings (as described below) and,
to facilitate such offerings, will (a) change the name of Xxxxxxxxx Energy, Inc. to Xxxxxxxxx
Holdings, Inc. (“AH”); (b) convert Xxxxxxxxx Land Company, LLC from a limited liability
company to a corporation, and in connection therewith, change the name of Xxxxxxxxx Land Company,
LLC to Xxxxxxxxx Energy, Inc. (“AE”) and issue stock from the resulting corporation in exchange for
the prior membership interests of Xxxxxxxxx Land Company, LLC (such actions are collectively
referred to as the “2011 Conversion”); and (c) merge Xxxxxxxxx Resources Holdings, LLC into
AH;
WHEREAS, AE may sell additional equity in AE pursuant to private placement(s) (the “AE
Equity Offering”);
WHEREAS, Elk Creek L.P. may sell additional equity in Elk Creek L.P. pursuant to private
placement(s) (the “Elk Creek Equity Offering”);
WHEREAS, to permit the foregoing transactions and to modify certain provisions of the Credit
Agreement, the Loan Parties have requested that the Lenders agree to various amendments as set
forth herein, and the Lenders have agreed to amend the Credit Agreement as hereinafter provided.
NOW, THEREFORE, in consideration of the foregoing and intending to be legally bound, and
incorporating the above-defined terms herein, the parties hereto agree as follows:
1. Recitals; Capitalized Terms. The foregoing recitals are true and correct and
incorporated herein by reference. Unless otherwise defined herein, capitalized terms used herein
shall have the meanings given to them in the Credit Agreement.
2. Amendments to Credit Agreement.
(a) Amended Definitions. The following definitions are hereby amended and restated as
follows:
“Fixed Charge Coverage Ratio shall mean the ratio of (a) Consolidated EBIT to (b)
Fixed Charges.”
(b) New Definitions. The following new definitions are hereby inserted in Section 1.1
of the Credit Agreement in alphabetical order:
“2011 Conversion shall mean the conversion of Xxxxxxxxx Land Company, LLC from a
limited liability company to a corporation, as permitted by the First Amendment.”
“AE Equity Offering shall mean the issuance of equity out of Xxxxxxxxx Energy, Inc.
pursuant to a private placement(s), as permitted by the First Amendment.”
“Auditor’s Report shall have the meaning ascribed to such term in Section 8.3.2
[Annual Financial Statements].”
“Consolidated EBIT for any period of determination shall mean Consolidated EBITDA less
depreciation, depletion and amortization.”
“Elk Creek Equity Offering shall mean the issuance of equity out of Elk Creek L.P.
pursuant to a private placement(s), as permitted by the First Amendment.”
“First Amendment shall mean that certain First Amendment to this Agreement dated as of
July 1, 2011.”
“First Amendment Effective Date shall mean July 1, 2011.”
(c) Amendment to Schedule 1.1(A) to the Credit Agreement [Pricing Grid] of the Credit
Agreement. Schedule 1.1(A) to the Credit Agreement is hereby deleted in its entirety and
replaced with Schedule 1.1(A) to this Amendment and any change in pricing shall be effective as of
the First Amendment Effective Date.
(d) Updated Schedule 1.1(R) to the Credit Agreement. Schedule 1.1(R) to the Credit
Agreement is hereby deleted in its entirety and replaced with the corresponding Schedule attached
to and made part of this Amendment.
(e) Amendment to Section 3.2 of the Credit Agreement [Nature of Term Lenders’ Obligations
with Respect to Term Loans; Repayment Terms]. Section 3.2 is hereby amended and restated as
follows:
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“3.2 Nature of Term Lenders’ Obligations with Respect to Term Loans; Repayment
Terms. The obligations of each Term Lender to make Term Loans to the Term Borrowers
shall be in the proportion that such Term Lender’s Term Loan Commitment bears to the Term
Loan Commitments of all Term Lenders to the Term Borrowers, but each Term Lender’s Term Loan
to the Term Borrowers shall never exceed its Term Loan Commitment. The failure of any Term
Lender to make a Term Loan shall not relieve any other Term Lender of its obligations to
make a Term Loan nor shall it impose any additional liability on any other Term Lender
hereunder. The Term Lenders shall have no obligation to make Term Loans hereunder after the
Closing Date. The Term Loan Commitments are not revolving credit commitments, and the Term
Borrowers shall not have the right to borrow, repay and reborrow under Section 3.1 [Term
Loan Commitments]. Principal on the Term Loans shall be paid quarterly on each Payment
Date, commencing January 1, 2012, in a principal amount equal to 5.0% of the outstanding
principal balance of the Term Loans as of December 31, 2011 with the entire remaining
principal balance and any outstanding interest payable on the Maturity Date, unless
otherwise accelerated pursuant to the terms of this Agreement.”
(f) Amendment to Section 5.7.4 of the Credit Agreement [Issuance of Equity]. Section
5.7.4 is hereby amended and restated as follows:
“5.7.4 Issuance of Equity. Within five (5) Business Days of any issuance or
sale of equity by any Borrower (other than issuances pursuant to subsection (a), (b) and (c)
of Section 8.2.12 [Issuance of Stock] of this Agreement), the Borrowers shall make a
mandatory prepayment of principal on the Term Loans equal to the Net Cash Proceeds, together
with accrued interest on such principal amount. Notwithstanding the foregoing, the
mandatory prepayment of principal on the Term Loans with respect to the Net Cash Proceeds
obtained in connection with any AE Equity Offering or Elk Creek Equity Offering occurring
prior to December 31, 2011 shall be equal to the higher of (i) all Net Cash Proceeds up to
$40,000,000 in the aggregate, or (ii) 50% of such Net Cash Proceeds in the aggregate. All
prepayments pursuant to this Section 5.7.4 shall be applied to payment in full of the
principal amount of the Term Loans by application to the unpaid installments of principal in
the inverse order of scheduled maturities.”
(g) Amendment to Section 8.1.11(ii) of the Credit Agreement [Collateral and Additional
Collateral (Including As-Extracted Collateral); Execution and Delivery of Additional and Ancillary
Security Documents]. The first sentence of Section 8.1.11(ii) is hereby amended and restated
as follows:
“(ii) Without limiting the generality of the foregoing, each applicable Loan Party which owns
or leases any real property shall execute and deliver any and all Mortgages substantially in the
form of Exhibit 1.1(M) hereof, other Mortgages, deeds of trust, assignments, pledges,
security interests, financing statements and additional documents and agreements
relating thereto and Ancillary Security Documents reasonably requested by the Agent to grant a
first priority Lien (subject only to Permitted Liens), and with respect to any leased Real
Property, any lessor consents that the Administrative Agent reasonably requests, in such Loan
Party’s interest in such real property in favor of the Administrative Agent, for the ratable
benefit of the
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Lenders, as security for the Obligations; provided that, with respect to any real
estate (whether fee or leasehold) acquired after the Closing Date, such Mortgages and other
documents and instruments shall be executed and delivered (a) within thirty (30) days after the
First Amendment Effective Date, for those properties acquired prior to the date of the First
Amendment and (b) within thirty (30) days after the end of each fiscal quarter, for properties
acquired by the Loan Parties during such fiscal quarter.”
All other provisions in Section 8.1.11(ii) shall remain unchanged.
(h) Amendment to Section 8.2.12 of the Credit Agreement [Issuance of Stock]. Section
8.2.12 is hereby amended and restated in its entirety as follows:
“8.2.12 Issuance of Stock. Each of the Loan Parties shall not, and shall not
permit any of its Subsidiaries to, issue any additional shares of its capital stock,
membership interests, partnership interests or any options, warrants or other rights in
respect thereof, except (a) in connection with compensation, benefit plans or incentive
plans for employees or officers, (b) issuances of stock or interests in Loan Parties to
other Loan Parties; (c) in connection with: (i) the exchange of equity interests in
Xxxxxxxxx Land Company, LLC or Elk Creek, L.P. for the minority equity interests held as of
the Closing Date in Xxxxxxxxx Resources Holdings, LLC, Xxxxxxxxx Land Company, LLC and
Xxxxxxxxx Energy, Inc; or (ii) the purchase of additional equity by the Yorktown Parties or
other existing owners of Xxxxxxxxx Land Company, LLC or Elk Creek L.P.; (d) the conversion
of membership interests into capital stock in connection with the 2011 Conversion or (e) the
sale of equity in AE and Elk Creek, L.P. in connection with the AE Equity Offerings or Elk
Creek Equity Offerings, respectively.”
(i) Amendment to Section 8.2.14 of the Credit Agreement [Minimum Fixed Charge Coverage
Ratio]. Section 8.2.14 is hereby amended and restated in its entirety as follows:
“8.2.14 Minimum Fixed Charge Coverage Ratio. The Loan Parties shall not permit
the Fixed Charge Coverage Ratio of the Loan Parties, calculated as of the end of each fiscal
quarter for the four fiscal quarters then ended, to be less than (a) 1.05 to 1.00 for the
fiscal quarter ending March 31, 2012 through the fiscal quarter ending December 31, 2012,
and (b) 1.25 to 1.00 for the fiscal quarter ending March 31, 2013 and each fiscal quarter
thereafter.”
(j) Amendment to Section 8.2.15 of the Credit Agreement [Maximum Leverage Ratio].
Section 8.2.15 is hereby amended and restated in its entirety as follows:
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“8.2.15 Maximum Leverage Ratio. The Loan Parties shall not at any time permit
the Leverage Ratio of the Loan Parties to exceed the ratio set forth below for the periods
specified below:
| Fiscal Quarter Ending | Maximum Ratio | |
June 30, 2011 |
5.00 to 1.00 | |
September 30, 2011* |
4.75 to 1.00 | |
December 31, 2011 |
3.50 to 1.00 | |
March 31, 2012 |
3.25 to 1.00 | |
June 30, 2012 |
2.75 to 1.00 | |
September 30, 2012 |
2.75 to 1.00 | |
December 31, 2012 and each fiscal quarter thereafter |
2.50 to 1.00 |
| * | Notwithstanding the above, the maximum permitted Leverage Ratio as tested on September 30, 2011 shall be reduced by 0.25 for every $10,000,000 of Net Cash Proceeds received from AE Equity Offerings and Elk Creek Equity Offerings occurring prior to December 31, 2011 but in no event will such Leverage Ratio be reduced to less than 3.50 to 1.00.” |
(k) Amendment to Section 8.2.16 of the Credit Agreement [Minimum Consolidated EBITDA].
Section 8.2.16 is hereby amended and restated in its entirety as follows:
“8.2.16 Minimum Consolidated EBITDA. The Loan Parties shall not at any time
permit Consolidated EBITDA of the Loan Parties to be less than the following amounts during
the following periods:
| Period | Minimum Amount | |||
June 30, 2011 for the two fiscal quarters then ending |
$ | 14,000,000 | ||
September 30, 2011 for the three fiscal quarters then ending |
$ | 27,500,000 | ||
December 31, 2011 for the four fiscal quarters then ending |
$ | 40,000,000 | ||
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(l) Amendment to Section 8.3.1 [Monthly Financial Statements] and Section 8.3.2 [Annual
Financial Statements] of the Credit Agreement. Sections 8.3.1 and 8.3.2 are hereby amended and
restated in their entirety as follows:
“8.3.1 Monthly Financial Statements. As soon as available and in any event
within thirty (30) calendar days after the end of each of each calendar month, (i) financial
statements of the Loan Parties, consisting of a consolidated balance sheet as of the end of
such month and related consolidated statements of income, stockholders’ equity and cash
flows for the month then ended and the fiscal year through that date, all in reasonable
detail and certified (subject to normal year-end audit adjustments) by an Authorized Officer
of the Borrowers as having been prepared in accordance with GAAP, consistently applied, and
setting forth in comparative form the respective financial statements for the corresponding
date and period in the previous fiscal year, or (ii) in lieu of the foregoing, upon the
occurrence of the AE Equity Offering and the Elk Creek Equity Offering (in which case the
monthly financial statements will no longer be provided for all Loan Parties on a
consolidated basis), (1) financial statements of Xxxxxxxxx Energy, Inc. and its
Subsidiaries, consisting of a consolidated balance sheet as of the end of such month and
related consolidated statements of income, stockholders’ equity and cash flows for the month
then ended and the fiscal year through that date, all in reasonable detail and certified
(subject to normal year-end audit adjustments) by an Authorized Officer of the Borrowers as
having been prepared in accordance with GAAP, consistently applied, and setting forth in
comparative form the respective financial statements for the corresponding date and period
in the previous fiscal year; (2) financial statements of Elk Creek L.P. and its
Subsidiaries, consisting of a consolidated balance sheet as of the end of such month and
related consolidated statements of income, stockholders’ equity and cash flows for the month
then ended and the fiscal year through that date, all in reasonable detail and certified
(subject to normal year-end audit adjustments) by an Authorized Officer of the Borrowers as
having been prepared in accordance with GAAP, consistently applied, and setting forth in
comparative form the respective financial statements for the corresponding date and period
in the previous fiscal year; and (3) combined financial statements of Xxxxxxxxx Energy, Inc.
and its Subsidiaries and Elk Creek L.P. and its Subsidiaries, consisting of combined balance
sheet of Xxxxxxxxx Energy, Inc. and its Subsidiaries and Elk Creek L.P. and its Subsidiaries
as of the end of such month and related combined statements of income, stockholders’ equity
and cash flows for the month then ended and the fiscal year through that date, all in
reasonable detail and certified (subject to normal year-end audit adjustments) by an
Authorized Officer of the Borrowers as having been prepared in accordance with GAAP,
consistently applied, and setting forth in comparative form the respective financial
statements for the corresponding date and period in the previous fiscal year; provided
that there shall be separate columns (all in reasonable detail, certified by the
authorized officers subject to normal year-end audit adjustments and presented in a similar
fashion as if the financial statements were audited) for (w) Xxxxxxxxx Energy, Inc. and its
Subsidiaries, (x) Elk Creek L.P. and its Subsidiaries, (y) affiliate elimination entries and
(z) a column representing the combined sum of items (w) and (x) taking into account the
affiliate elimination entries described in item (y), above.
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8.3.2 Annual Financial Statements. As soon as available and in any event
within 135 days of the end of the 2010 fiscal year and 120 days after the end of each fiscal
year thereafter of the Loan Parties, (i) financial statements of each Loan Party consisting
of a consolidated and consolidating balance sheet as of the end of such fiscal year, and
related consolidated and consolidating statements of income, stockholders’ equity and cash
flows for the fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding fiscal
year, and, with respect to the consolidated financial statements, certified by Ernst & Young
or another independent certified public accountants reasonably satisfactory to the
Administrative Agent and delivered together with any management letters of such accountants
addressed to any Borrower. The certificate or report of accountants shall be free of
qualifications (other than any consistency qualification that may result from a change in
the method used to prepare the financial statements as to which such accountants concur) and
shall not indicate the occurrence or existence of any event, condition or contingency which
would materially impair the prospect of payment or performance of any covenant, agreement or
duty of any Loan Party under any of the Loan Documents or (ii) in lieu of the foregoing,
upon the occurrence of the AE Equity Offering and the Elk Creek Equity Offering (in which
case the annual financial statements will no longer be audited for all Loan Parties on a
consolidated basis), (1) financial statements of Xxxxxxxxx Energy, Inc. and its Subsidiaries
consisting of a consolidated and consolidating balance sheet as of the end of such fiscal
year, and related consolidated and consolidating statements of income, stockholders’ equity
and cash flows for the fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding fiscal
year, and, and, with respect to the consolidated financial statements, certified by Ernst &
Young or another independent certified public accountants reasonably satisfactory to the
Administrative Agent and delivered together with any management letters of such accountants
addressed to any Borrower; (2) financial statements of Elk Creek L.P. and its Subsidiaries
consisting of a consolidated and consolidating balance sheet as of the end of such fiscal
year, and related consolidated and consolidating statements of income, stockholders’ equity
and cash flows for the fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding fiscal
year, and, and, with respect to the consolidated financial statements, certified by Ernst &
Young or another independent certified public accountants reasonably satisfactory to the
Administrative Agent and delivered together with any management letters of such accountants
addressed to any Borrower (and such certificate or report of accountants referred to in item
(1) and (2), above, shall be free of qualifications (other than any consistency
qualification that may result from a change in the method used to prepare the financial
statements as to which such accountants concur) and shall not indicate the occurrence or
existence of any event, condition or contingency which would materially impair the prospect
of payment or performance of any covenant, agreement or duty of any Loan Party under any of
the Loan Documents); and (3) combined financial statements of Xxxxxxxxx Energy, Inc. and
its Subsidiaries and Elk Creek L.P. and its Subsidiaries, consisting of combined balance
sheet of Xxxxxxxxx
Energy, Inc. and its Subsidiaries and Elk Creek L.P. and its Subsidiariesas, of the end of
such fiscal year, and related combined statements of income, stockholders’ equity and
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cash
flows for the fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding fiscal
year; provided that there shall be separate columns (all in reasonable detail,
certified by the authorized officers subject to normal year-end audit adjustments and
presented in a similar fashion as if the financial statements were audited) for (w)
Xxxxxxxxx Energy, Inc. and its Subsidiaries, (x) Elk Creek L.P. and its Subsidiaries, (y)
affiliate elimination entries and (z) a column representing the combined sum of items (w)
and (x) taking into account the affiliate elimination entries described in item (y), above;
provided further that the Loan Parties shall be required to deliver a formal
auditor’s report in connection with the combined financial statements in form and substance
acceptable to the Administrative Agent, to be performed by an independent auditor acceptable
to the Administrative Agent (the “Auditor’s Report”). The Auditor’s Report shall set forth
the agreed upon procedures, acceptable in to the Administrative Agent, and the type and
extent of such agreed upon procedures performed shall be acceptable to the Administrative
Agent.”
(m) Amendment to Section 9.1.10 of the Credit Agreement [Change of Control]. Section
9.1.10 is hereby amended and restated in its entirety as follows:
“9.1.10 Change of Control. (i) The Yorktown Parties shall fail to own,
directly or indirectly, at least 51% of the voting capital stock, partnership interests
and/or member interests in each of the Borrowers; or (ii) to the extent managed by a board
of directors or managers, within a period of twelve (12) consecutive calendar months,
individuals who were directors or managers of any Borrower on the first day of such period
shall cease to constitute a majority of the board of directors or board of managers of such
Borrowers (except in connection with the AE Equity Offerings or Elk Creek Equity Offerings
occuring on or before December 31, 2011).”
3. Certain Corporate Changes. The Credit Agreement shall be amended as follows:
(i) Upon Xxxxxxxxx Energy, Inc. changing its name to Xxxxxxxxx Holdings, Inc., all references
in the Credit Agreement which originally referred to “Xxxxxxxxx Energy, Inc.” shall hereafter refer
to “Xxxxxxxxx Holdings, Inc.”; and
(ii) Upon Xxxxxxxxx Land Company, LLC. changing its name to Xxxxxxxxx Energy, Inc., all
references in the Credit Agreement which originally referred to “Xxxxxxxxx Land Company, LLC” or
“Xxxxxxxxx Land” shall hereafter refer to “Xxxxxxxxx Energy, Inc.”
4. Conditions to Effectiveness. The amendments contained in this Amendment shall
become effective upon satisfaction of each of the following conditions being satisfied to the
satisfaction of the Administrative Agent:
(a) Execution and Delivery of this Amendment. The Borrowers, the Guarantors, the
Lenders and the Administrative Agent shall have executed and delivered this Amendment.
(b) Officer’s Certificate. There shall be delivered to the Administrative Agent for
the benefit of each Lender a certificate, dated the date hereof and signed by an Authorized Officer
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certifying that (w) all representations and warranties of the Loan Parties set forth in the Credit
Agreement are true and correct, (x) the Loan Parties are in compliance with each of the covenants
and conditions hereunder, and (y) no Event of Default or Potential Default exists.
(c) Secretary’s Certificate. There shall be delivered to the Administrative Agent for
the benefit of each Lender a certificate, dated the date hereof and signed by the Secretary, an
Assistant Secretary or Authorized Officer of each Loan Party, certifying as appropriate as to:
(i) all action taken by such party in connection with this Amendment and the other
documents executed and delivered in connection herewith, together with authorizing
resolutions on behalf of each of the Loan Parties evidencing same;
(ii) the names of the officer or officers authorized to sign this Amendment and the
other documents executed and delivered in connection herewith and the true signatures of
such officer or officers and specifying the Authorized Officers permitted to act on behalf
of the Loan Parties for purposes of the Loan Documents and the true signatures of such
officers, on which the Administrative Agent and each Lender may conclusively rely; and
(iii) copies of its organizational documents, including its certificate of
incorporation, bylaws, certificate of limited partnership, partnership agreement,
certificate of formation and limited liability company agreement, in each case as in effect
on the date hereof, certified by the appropriate state official where such documents are
filed in a state office together with certificates from the appropriate state officials as
to the continued existence and good standing of the Loan Party in each state where organized
or qualified to do business; provided, however, that the Loan Parties may, in lieu of
delivering copies of the foregoing organizational documents and good standing certificates,
certify that the organizational documents and good standing certificates previously
delivered by the Loan Parties to the Administrative Agent remain in full force and effect
and have not been modified, amended, or rescinded.
(d) Opinions of Counsel. There shall be delivered to the Administrative Agent for the
benefit of each Lender a written opinion of counsel for the Loan Parties, dated the First Amendment
Date, and in form and substance satisfactory to the Administrative Agent and its counsel as to such
matters with respect to the transactions contemplated herein as the Administrative Agent may
reasonably request.
(e) Material Adverse Change; Litigation. Each of the Loan Parties shall provide a
certificate that represents and warrants to the Administrative Agent and the Lenders that by its
execution and delivery hereof to the Administrative Agent, after giving effect to this Amendment
and the transactions contemplated herein:
(i) no Material Adverse Change shall have occurred with respect to the Borrowers or any
of the Loan Parties since the Closing Date of the Credit Agreement;
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(ii) no default shall have occurred with respect to any note or credit agreement
governing existing indebtedness of the Borrowers or Guarantors as a result of any of the
transactions contemplated herein; and
(iii) there are no actions, suits, investigations, litigation or governmental
proceedings pending or, to the Loans Parties’ knowledge, threatened against any of the Loan
Parties that could reasonably be expected to result in a Material Adverse Change or relate
to any of the transactions contemplated herein.
(f) Consents and Approvals. No consent, approval, exemption, order or authorization
of, or a registration or filing with, any Official Body or any other Person is required by any Law
or any agreement in connection with the execution, delivery and carrying out of this Amendment by
any Loan Party other than such consents, approvals, exemptions, orders or authorizations that have
already been obtained.
(g) Fees. The Borrowers shall have paid to the Administrative Agent any reasonable
fees due and payable to the Administrative Agent and the Lenders in connection with this Amendment.
5. Miscellaneous.
(a) Representations and Warranties. By its execution and delivery hereof to the
Administrative Agent, each of the Loan Parties represents and warrants to the Administrative Agent
and the Lenders that such Loan Party has duly authorized, executed and delivered this Amendment.
(b) Full Force and Effect. All provisions of the Credit Agreement remain in full
force and effect on and after the date hereof except as expressly amended hereby. The parties do
not amend any provisions of the Credit Agreement except as expressly amended hereby.
(c) Counterparts. This Amendment may be signed in counterparts (by facsimile
transmission or otherwise) but all of such counterparts together shall constitute one and the same
instrument.
(d) Incorporation into Credit Agreement. This Amendment (including all Schedules and
Exhibits) shall be incorporated into the Credit Agreement by this reference. All representations,
warranties, Events of Default and covenants set forth herein shall be a part of the Credit
Agreement as if originally contained therein.
(e) Governing Law. This Amendment and the rights and obligations of the parties
hereunder shall be governed by, and construed in accordance with, the laws of the State of New York
without regard to its conflict of laws principles.
(f) Payment of Fees and Expenses. The Borrowers unconditionally agree to pay and
reimburse the Administrative Agent and save the Administrative Agent harmless against liability for
the payment of all reasonable out-of-pocket costs, expenses and disbursements of the Administrative
Agent, including, without limitation, the reasonable fees and expenses of counsel
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incurred by the Administrative Agent in connection with the development, preparation,
execution, administration, interpretation or performance of this Amendment, any mortgage recording
fees and mortgage or recording taxes, and all other documents or instruments to be delivered in
connection herewith.
(g) No Novation. Except as amended hereby, all of the terms and conditions of the
Credit Agreement and the other Loan Documents shall remain in full force and effect. The
Borrowers, the Guarantors, each Lender, and the Administrative Agent acknowledge and agree that
this Amendment is not intended to constitute, nor does it constitute, a novation, interruption,
suspension of continuity, satisfaction, discharge or termination of the obligations, loans,
liabilities, or indebtedness under the Credit Agreement or the other Loan Documents.
[SIGNATURE PAGES FOLLOW]
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[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have
executed this First Amendment as of the day and year first above written.
REVOLVER AND TERM BORROWER:
| XXXXXXXXX COAL COMPANY, INC. |
||||
| By: | /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President | |||
REVOLVER BORROWER AND TERM GUARANTOR:
| XXXXXXXXX LAND COMPANY, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
TERM BORROWERS AND REVOLVER GUARANTORS
| WESTERN MINERAL DEVELOPMENT, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | Manager | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| WESTERN DIAMOND LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | Manager | |||
| WESTERN LAND COMPANY, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | Manager | |||
| ELK CREEK L.P. |
||||
| By: | ELK CREEK GP, LLC, as General Partner | |||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
REVOLVER AND TERM GUARANTORS:
| XXXXXXXXX ENERGY, INC. |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| XXXXXXXXX RESOURCES HOLDINGS, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
| ELK CREEK GP, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
| ELK CREEK OPERATING GP, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
| ELK CREEK OPERATING, L.P. |
||||
| By: | Elk Creek Operating GP, LLC, as General Partner | |||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | President and Chief Financial Officer | |||
| CERALVO HOLDINGS, LLC |
||||
| By: | : /s/ Xxxxxx X. Xxxxxx | |||
| Name: | Xxxxxx X. Xxxxxx | |||
| Title: | Manager | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| PNC BANK, NATIONAL ASSOCIATION, individually and as Administrative Agent |
||||
| By: | /s/ Xxxx X. Xxxxx | |||
| Name: | Xxxx X. Xxxxx | |||
| Title: | Senior Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| U.S. BANK NATIONAL ASSOCIATION |
||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxx X. Xxxxxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| UNION BANK, N.A. |
||||
| By: | /s/ Yangling Xxxxxx Si | |||
| Name: | Yangling Xxxxxx Si | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| FIRST COMMONWEALTH BANK |
||||
| By: | /s/ C. Xxxxxxx Xxxxx | |||
| Name: | C. Xxxxxxx Xxxxx | |||
| Title: | Executive Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| REGIONS BANK |
||||
| By: | /s/ Xxxx Xxxxxxx | |||
| Name: | Xxxx Xxxxxxx | |||
| Title: | Senior Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| THE HUNTINGTON NATIONAL BANK |
||||
| By: | /s/ Xxxx X. Xxxx | |||
| Name: | Xxxx X. Xxxx | |||
| Title: | Vice President | |||
[SIGNATURE PAGE TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| XXXXXXX XXXXX BANK, FSB |
||||
| By: | /s/ Xxxxxxx XxXxxxxx | |||
| Name: | Xxxxxxx XxXxxxxx | |||
| Title: | Senior Vice President | |||
SCHEDULE 1.1(A)
PRICING GRID—
VARIABLE PRICING AND FEES BASED ON LEVERAGE RATIO
VARIABLE PRICING AND FEES BASED ON LEVERAGE RATIO
| Letter of Credit | Base Rate | LIBOR Rate | ||||||||||||
| Level | Leverage Ratio | Fee | Spread | Spread | ||||||||||
I
|
Greater than or equal to 4.0 to 1.0 | 4.75 | % | 3.75 | % | 4.75 | % | |||||||
II
|
Greater than or equal to 3.0 to 1.0 but less than 4.0 to 1.0 | 4.25 | % | 3.25 | % | 4.25 | % | |||||||
III
|
Greater than or equal to 2.5 to 1.0 but less than 3.0 to 1.0 | 3.75 | % | 2.75 | % | 3.75 | % | |||||||
IV
|
Greater than or equal to 2.0 to 1.0 but less than 2.5 to 1.0 | 3.50 | % | 2.50 | % | 3.50 | % | |||||||
V
|
Greater than or equal to 1.5 to 1.0 but less than 2.0 to 1.0 | 3.25 | % | 2.25 | % | 3.25 | % | |||||||
VI
|
Less than 1.5 to 1.0 | 3.00 | % | 2.00 | % | 3.00 | % | |||||||
For purposes of determining the Applicable Margin and the Applicable Letter of Credit Fee
Rate:
(a) The Applicable Margin and the Applicable Letter of Credit Fee Rate shall be set on the
First Amendment Effective Date to the fees and spreads associated with “Level I” pricing and shall
remain at such level until the earlier of (i) the delivery of a pro forma Compliance Certificate
evidencing the Net Cash Proceeds obtained from the AE Equity Offerings and Elk Creek Equity
Offerings, or (ii) the Compliance Certificate for the fiscal quarter ending September 30, 2011.
(b) The Applicable Margin and the Applicable Letter of Credit Fee Rate shall be recomputed on
the earlier of (i) the delivery of a pro forma Compliance Certificate evidencing the Net Cash
Proceeds obtained from the AE Equity Offerings and Elk Creek Equity Offerings, or (ii) the
Compliance Certificate for the fiscal quarter ending September 30, 2011, and for each fiscal
quarter thereafter based on the Leverage Ratio as of such quarter end. Any increase or decrease in
the Applicable Margin or the Applicable Letter of Credit Fee Rate computed as of a quarter end
shall be effective on the date on which the Compliance Certificate evidencing such computation is
due to be delivered under Section 8.3.3 [Certificate of Borrowers]. If a Compliance Certificate is
not delivered when due in accordance with such Section 8.3.3 , then the rates in Level I shall
apply as of the first Business Day after the date on which such Compliance Certificate was required
to have been delivered and shall remain in effect until the date on which such Compliance
Certificate is delivered.
(c) If, as a result of any restatement of or other adjustment to the financial statements of
the Borrowers or for any other reason, the Borrowers or the Lenders determine that (i) the Leverage
Ratio as calculated by the Borrowers as of any applicable date was inaccurate and (ii) a proper
calculation of the Leverage Ratio would have resulted in higher pricing for such period, the
Borrowers shall immediately and retroactively be obligated to pay to the Administrative Agent for
the account of the applicable Lenders, promptly on demand by the Administrative Agent (or, after
the occurrence of an actual or deemed entry of an order for relief with respect to the Borrowers
under the Bankruptcy Code of the United States, automatically and without further action by the
Administrative Agent, any Lender or the Issuing Lender), an amount equal to the excess of the
amount of interest and fees that should have been paid for such period over the amount of interest
and fees actually paid for such period. This paragraph shall not limit the rights of the
Administrative Agent, any Lender or the Issuing Lender, as the case may be, under Section 2.9
[Letter of Credit Subfacility] or 4.3 [Interest After Default] or 9 [Default]. The Borrowers’
obligations under this paragraph shall survive the termination of the Commitments and the repayment
of all other Obligations hereunder.
Schedule 1.1(R)
See attached.
