FIRST AMENDMENT TO SECOND AMENDED AND RESTATED FINANCING AGREEMENT
FIRST
AMENDMENT TO SECOND AMENDED
AND
RESTATED FINANCING AGREEMENT
THIS
FIRST AMENDMENT TO SECOND AMENDED AND RESTATED FINANCING
AGREEMENT
(“this
Agreement”)
entered into on this 20th day of September, 2007, to be
effective, unless another effective date is otherwise herein specified, as
of
the date hereof, is by and among The CIT Group/Business Credit, Inc.
(“CIT”),
SunTrust Bank (“SunTrust”),
Wachovia Bank, N.A. (“Wachovia”)
and
PNC Bank National Association (“PNC”),
as
Lenders, CIT as administrative and collateral agent (“Agent”),
United Fuel & Energy Corporation, a Texas corporation (“United”),
and
Three D Oil Co. of Xxxxxxx, Inc., a Texas corporation (“Three
D”)
(United and Three D being herein individually referred to as a “Company”
and
collectively referred to as the “Companies”),
and
United Fuel & Energy Corporation, a Nevada corporation (“Parent”).
RECITALS
A. Companies,
Agent and Lenders entered into that certain Second Amended and Restated
Financing Agreement, dated as of March 27, 2007, together with all riders,
addenda, exhibits and other documents relating thereto (collectively, as amended
from time to time, the “Financing
Agreement”).
B. Pursuant
to the terms and conditions of this Agreement, each of Companies, Agent and
Lenders are willing to amend the Financing Agreement.
NOW,
THEREFORE,
in
consideration of the premises herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties, intending to be legally bound, agree as follows, as hereinafter set
forth:
ARTICLE
I
Definitions
1.01 Capitalized
terms used in this Agreement are defined in the Financing Agreement, as amended
hereby, unless otherwise stated.
ARTICLE
II
Agreements
2.01 Amendment
to Section 1 of Financing Agreement; Amendments to Definition of “Applicable
LIBOR Margin”.
Effective as of August 31, 2007, the definition of “Applicable LIBOR
Margin” contained in Section
1
of the
Financing Agreement is amended as follows:
(a) Clause
(i)
of
paragraph
(a)
of the
definition of “Applicable LIBOR Margin” is amended and restated to read in its
entirety as follows:
“(i) (A)
during the period from the Closing Date through August 31, 2007 - 1.75% and
(B)
during the period beginning on September 1, 2007 until the Initial
Adjustment Date - 2.25%; and”
(b) The
pricing table contained in the definition of “Applicable LIBOR Margin” is
amended and restated to read in its entirety as follows:
“APPLICABLE
LIBOR MARGIN
PRICING
TABLE
|
Fixed
Charge Coverage Ratio
|
Applicable
LIBOR Margin
|
|
(A) Greater
than or equal to 2.25 to 1.00
|
(A) 1.25%
|
|
(B) Less
than 2.25 to 1.00, but equal to or greater than 1.75 to
1.00
|
(B) 1.50%
|
|
(C) Less
than 1.75 to 1.00, but equal to or greater than 1.40 to
1.00
|
(C) 1.75%
|
|
(D) Less
than 1.40 to 1.00, but equal to or greater than 1.20 to
1.00
|
(D) 2.00%
|
|
(E) Less
than 1.20 to 1.00
|
(E) 2.25%”
|
2.02 Amendment
to Section 1 of the Financing Agreement; Amendment and Restatement of Definition
of “Initial Adjustment Date”.
Effective as of August 31, 2007, the definition of “Initial Adjustment Date”
contained in Section
1
of the
Financing Agreement is amended and restated to read in its entirety as
follows:
“Initial
Adjustment Date
shall
mean the later of (a) November 1, 2007 or (b) the tenth day after the delivery
to Agent pursuant to Section 7.8(c)
hereof
of the financial statements of the Companies for the month ending September
30,
2007.”
2.03 Amendment
to Section 7.8(b) of the Financing Agreement; New Due Date for Delivery of
Quarterly Financial Statements for the Quarter Ended June 30,
2007.
Effective as of August 29, 2007, Agent, Lenders and Companies agree that the
date by which Companies need to furnish to Agent the financial statements for
the fiscal quarter ended June 30, 2007 required by Section 7.8(b) of the
Financing Agreement shall be changed to September 30, 2007.
2.04 Amendment
to Section 7.8(c) of the Financing Agreement; New Due Date for Delivery of
July
2007 Financial Statements.
Effective as of August 30, 2007, Agent, Lenders and Companies agree that the
date by which Companies need to furnish to Agent the financial statements for
July 2007 required by Section
7.8(c)
of the
Financing Agreement shall be changed to September 30, 2007.
2
2.05 Amendment
to Section 7.10(a) of the Financing Agreement.
Effective as of May 30, 2007, Section
7.10(a)
of the
Financing Agreement is amended and restated to read in its entirety as
follows:
“(a) Maintain
as of the last day of each calendar month indicated below for the number of
calendar months indicated below, a Fixed Charge Coverage Ratio for such period
of not less than the ratio indicated below:
|
(i)
|
Calendar
months ending May 31, 2007, June 30, 2007, July 31, 2007,
August 31, 2007 and September 30, 2007
|
(i)
|
There
shall be no Fixed Charge Coverage Ratio test.
|
|
|
(ii)
|
One
calendar month period ending on October 31, 2007
|
(ii)
|
1.00
to 1.00
|
|
|
(iii)
|
Two
calendar month period ending on November 30, 2007
|
(iii)
|
1.00
to 1.00
|
|
|
(iv)
|
Three
calendar month period ending on December 31, 2007
|
(iv)
|
1.05
to 1.00
|
|
|
(v)
|
Four
calendar month period ending on January 31, 2008
|
(v)
|
1.05
to 1.00
|
|
|
(vi)
|
Five
calendar month period ending on February 29, 2008
|
(vi)
|
1.05
to 1.00
|
|
|
(vii)
|
Six
calendar month period ending on March 31, 2008
|
(vii)
|
1.05
to 1.00
|
|
|
(viii)
|
Seven
calendar month period ending on April 30, 2008
|
(viii)
|
1.05
to 1.00
|
|
| (ix) |
Eight
calendar month period ending on May 31, 2008
|
(ix)
|
1.05
to 1.00
|
|
|
(x)
|
Nine
calendar month period ending on June 30, 2008
|
(x)
|
1.05
to 1.00
|
|
|
(xi)
|
Ten
calendar month period ending on July 31, 2008
|
(xi)
|
1.05
to 1.00
|
|
|
(xii)
|
Eleven
calendar month period ending on August 31, 2008
|
(xii)
|
1.05
to 1.00
|
|
|
(xiii)
|
Twelve
calendar month period ending on September 30, 2008, and on the last
day of each succeeding calendar month
|
(xiii)
|
1.05
to 1.00”
|
3
2.06 Amendment
to Section 7 of the Financing Agreement; Addition of New Section
7.10(c).
Effective as of the date hereof, Section
7
of the
Financing Agreement is amended by adding to Section
7,
a new
Section
7.10(c)
to read
in its entirety as follows:
“(c) Maintain
for the month of December, 2007, Average Monthly Availability of at least
$4,000,000. ‘Average Monthly Availability’ shall be determined by adding the
Availability at the end of each day during December 2007 and by dividing such
sum by 31.”
2.07 Amendment
Fee.
In
consideration for the agreements set forth herein, Companies shall pay to Agent,
for the pro rata benefit of Lenders, an amendment fee of $45,000, which
amendment fee (i) shall be deemed fully earned on the date of execution of
this
Agreement, (ii) shall be non-refundable, and (iii) shall be due and payable
in
full on the date of execution of this Agreement.
ARTICLE
III
Waiver
3.01 Waiver.
The
Lenders hereby waive (i) any breach of the representations and warranties of
the
Companies set forth in Section 7.15(p) of the Financing Agreement as a result
of
the restatement by Parent of its financial statements for the quarter ended
March 31, 2007, and the year ended December 31, 2006; (ii) any Event of Default
arising out of any breach described under clause (i) of this Section 3.01;
and
(iii) any Event of Default caused by failures to satisfy conditions precedent
set forth in Section 2 of the Financing Agreement (including conditions
precedent to any further borrowing under the Financing Agreement) resulting
from
any breach described in clause (i) of this Section 3.01.
3.02 No
Other Waivers.
Except
as expressly set forth in Section
3.01
above,
nothing contained herein shall be construed as a waiver by Agent or any Lender
of any covenant or provision of the Loan Agreement, or any other Loan Document
or any other contract or instrument between any Company and/or Parent and Agent
and/or any Lender, and neither Agent’s nor any Lender’s failure at any time or
times hereafter to require strict performance by any Company and/or Parent
of
any provision thereof shall waive, affect or diminish any right of Agent or
any
Lender thereafter to demand strict compliance therewith. Each of Agent and
each
Lender hereby reserves all rights granted under the Loan Agreement, and each
other Loan Document and any other contract or instrument between any Company
and/or Parent and Agent and/or any Lender.
4
ARTICLE
IV
Conditions
Precedent
4.01 Conditions
to Effectiveness.
The
effectiveness of this Agreement is subject to the satisfaction of the following
conditions precedent, unless specifically waived in writing by
Agent:
(a) Agent
shall have received all of the following, each in form and substance
satisfactory to Agent (each of which shall be deemed to be a “Loan
Document”
for
purposes of the Financing Agreement):
(i) This
Agreement, duly executed by Companies, Parent and Lenders; and
(ii) Such
additional documents, instruments and information as Agent may
request.
(b) The
representations and warranties contained herein and in the Financing Agreement,
and the other Loan Documents, as each is amended hereby, shall be true and
correct as of the date hereof, as if made on the date hereof.
(c) No
Default or Event of Default shall have occurred and be continuing, unless such
Event of Default has been otherwise specifically waived in writing by Agent
and
Lenders.
(d) All
corporate proceedings taken in connection with the transactions contemplated
by
this Agreement and all documents, instruments and other legal matters incident
thereto shall be satisfactory to Agent and its legal counsel.
(e) Agent
shall have received payment, in immediately available funds, of the amendment
fee described in Section
2.07
hereof.
ARTICLE
V
Ratifications,
Representations and Warranties
5.01 Ratifications.
The
terms and provisions set forth in this Agreement shall modify and supersede
all
inconsistent terms and provisions set forth in the Financing Agreement and
the
other Loan Documents, and, except as expressly modified and superseded by this
Agreement, the terms and provisions of the Financing Agreement and the other
Loan Documents are ratified and confirmed and shall continue in full force
and
effect. Each of the parties hereto agrees that the Financing Agreement and
the
other Loan Documents, as amended hereby, shall continue to be legal, valid,
binding and enforceable in accordance with their respective terms.
5.02 Representations
and Warranties.
Each of
each Company and Parent hereby represents and warrants to Agent and each Lender
that (a) the execution, delivery and performance of this Agreement and any
and
all other Loan Documents executed and/or delivered in connection herewith have
been authorized by all requisite corporate action on the part of each of each
Company and Parent and will not violate the Articles of Incorporation or Bylaws
of any Company or Parent; (b) the representations and warranties contained
in
the Financing Agreement, as amended hereby, and any other Loan Document are
true
and correct on and as of the date hereof and on and as of the date of execution
hereof as though made on and as of each such date; and (c) no Default or Event
of Default under the Financing Agreement, as amended hereby, has occurred and
is
continuing, unless such Default or Event of Default has been specifically waived
in writing by Agent and each Lender. Each of each Company and Parent hereby
represents and warrants to Agent and each Lender that it is in full compliance
with all covenants and agreements contained in the Financing Agreement, and
the
other Loan Documents, as amended hereby.
5
ARTICLE
VI
Miscellaneous
Provisions
6.01 Survival
of Representations and Warranties.
All
representations and warranties made in the Financing Agreement or any other
Loan
Document, including, without limitation, any document furnished in connection
with this Agreement, shall survive the execution and delivery of this Agreement
and the other Loan Documents, and no investigation by Agent or any Lender or
any
closing shall affect the representations and warranties or the right of Agent
or
any Lender to rely upon them.
6.02 Reference
to Financing Agreement.
Each of
the Financing Agreement and the other Loan Documents and any and all other
agreements, documents or instruments now or hereafter executed and delivered
pursuant to the terms hereof or pursuant to the terms of the Financing
Agreement, as amended hereby, is hereby amended so that any reference in the
Financing Agreement and such other Loan Documents to the Financing Agreement
shall mean a reference to the Financing Agreement as amended
hereby.
6.03 Expenses
of Agent.
Each of
each Company and Parent agrees to pay on demand all costs and expenses incurred
by Agent in connection with the preparation, negotiation and execution of this
Agreement and the other Loan Documents executed pursuant hereto, and any and
all
amendments, modifications, and supplements thereto, including, without
limitation, the costs and fees of Agent’s legal counsel, and all costs and
expenses incurred by Agent in connection with the enforcement or preservation
of
any rights under the Financing Agreement, as amended hereby, or any other Loan
Document, including, without limitation, the costs and fees of Agent’s legal
counsel.
6.04 Severability.
Any
provision of this Agreement held by a court of competent jurisdiction to be
invalid or unenforceable shall not impair or invalidate the remainder of this
Amendment and the effect thereof shall be confined to the provision so held
to
be invalid or unenforceable.
6.05 Successors
and Assigns.
This
Agreement is binding upon and shall inure to the benefit of the parties hereto
and their respective successors and assigns, except neither any Company nor
Parent may assign or transfer any of its rights or obligations hereunder without
the prior written consent of Agent and each Lender.
6
6.06 Counterparts.
This
Agreement may be executed in one or more counterparts, each of which when so
executed shall be deemed to be an original, but all of which when taken together
shall constitute one and the same instrument.
6.07 Effect
of Waiver.
No
consent or waiver, express or implied, by Agent or any Lender to or for any
breach of or deviation from any covenant or condition by any Company or Parent
shall be deemed a consent to or waiver of any other breach of the same or any
other covenant, condition or duty.
6.08 Headings.
The
headings, captions, and arrangements used in this Agreement are for convenience
only and shall not affect the interpretation of this Agreement
6.09 Applicable
Law.
THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED PURSUANT HERETO SHALL
BE
DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN AND SHALL BE GOVERNED BY
AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS.
6.10 Final
Agreement.
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES, AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE
NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
6.11 Release.
EACH OF EACH COMPANY AND PARENT HEREBY ACKNOWLEDGES THAT IT HAS NO DEFENSE,
COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE
WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF ITS
LIABILITY TO REPAY THE “OBLIGATIONS” OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF
ANY KIND OR NATURE FROM AGENT OR ANY LENDER. EACH OF EACH COMPANY AND PARENT
HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES EACH OF AGENT
AND EACH LENDER, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS,
FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS,
EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR
UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL,
AT
LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS
AGREEMENT IS EXECUTED, WHICH ANY COMPANY OR PARENT MAY NOW OR HEREAFTER HAVE
AGAINST AGENT OR ANY LENDER, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND
ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF
CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING
FROM
ANY “LOANS”, INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR, CHARGING,
TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE HIGHEST
LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE
FINANCING AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION
OF THIS AGREEMENT.
[REMAINDER
OF THIS PAGE INTENTIONALLY LEFT BLANK]
7
Executed
on this 20th day of September, 2007, to be effective as of the
respective date indicated above.
|
UNITED
FUEL & ENERGY CORPORATION,
a
Texas corporation
|
||
|
By:
|
/s/
Xxxxx X. Page
|
|
|
Name:
|
Xxxxx
X. Page
|
|
|
Title:
|
Vice
President and Chief Financial Officer
|
|
|
THREE
D OIL CO. OF XXXXXXX, INC.,
a
Texas corporation
|
||
|
By:
|
/s/
Xxxxx X. Page
|
|
|
Name:
|
Xxxxx
X. Page
|
|
|
Title:
|
Vice
President and Chief Financial Officer
|
|
|
UNITED
FUEL & ENERGY CORPORATION,
|
||
|
a
Nevada corporation
|
||
|
By:
|
/s/
Xxxxx X. Page
|
|
|
Name:
|
Xxxxx
X. Page
|
|
|
Title:
|
Vice
President and Chief Financial Officer
|
|
ACCEPTED
at Dallas, Texas, this 20th day of September, 2007, to be
effective as of the respective date indicated above.
|
THE
CIT GROUP/ BUSINESS CREDIT, INC.,
as
Agent and Lender
|
||
| By: |
/s/
Xxxx Xxxxxxxx
|
|
| Name: | Xxxx Xxxxxxxx | |
| Title: |
Vice
President
|
|
| SUNTRUST
BANK,
as
Lender
|
||
| By: |
/s/
Xxxxx X X’Xxxxxx
|
|
| Name: | Xxxxx X X’Xxxxxx | |
| Title: |
Director
|
|
| WACHOVIA
BANK, N.A.,
as
Lender
|
||
| By: |
/s/
Xxxxxx X. Xxxxx
|
|
| Name: | Xxxxxx X. Xxxxx | |
| Title: |
Vice
President
|
|
| PNC
BANK NATIONAL ASSOCIATION,
as
Lender
|
||
| By: |
/s/
Xxx Xxxxxxx
|
|
| Name: | Xxx Xxxxxxx | |
| Title: |
Vice
President
|
|
