EXHIBIT 4.9
AMENDMENT NO. 1 TO CREDIT AGREEMENT
This Amendment No. 1 to Credit Agreement (the "Amendment") is dated as of
January 21, 2000 and is made by and among ARCH COAL, INC., a Delaware
corporation (the "Borrower"), the LENDERS party to the Credit Agreement (as
hereinafter defined), XXXXXX GUARANTY TRUST COMPANY OF NEW YORK, in its capacity
as Syndication Agent, FIRST UNION NATIONAL BANK, in its capacity as
Documentation Agent and PNC BANK, NATIONAL ASSOCIATION, in its capacity as
Administrative Agent (the Syndication Agent, Documentation Agent and
Administrative Agent are hereinafter collectively referred to as the "Agents").
WHEREAS, the parties hereto are parties to that certain Credit Agreement
dated as of June 1, 1998 (the "Credit Agreement"), pursuant to which the Lenders
provided a $600,000,000 revolving credit facility and a $300,000,000 term loan
facility to the Borrower (the outstanding amount of such term loan facility as
of the date hereof being $135,000,000); and
WHEREAS, the Borrower, the Lenders and the Agents desire to amend the
Credit Agreement as hereinafter provided.
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. Definitions.
Defined terms used herein unless otherwise defined herein shall have
the meanings ascribed to them in the Credit Agreement, as amended by this
Amendment.
2. Amendments to Credit Agreement.
(a) Section 1.1 [Certain Definitions] of the Credit Agreement is
hereby amended by the addition of the following new definitions:
"Apogee Synthetic Lease shall mean the lease dated as of January
15, 1998 among Apogee Coal Company, Catenary Coal Company, Hobet Mining, Inc.,
collectively as Lessees, First Security Bank, National Association, as Lessor,
and certain other Persons listed therein, as Certificate Purchasers, as amended
by the Omnibus Amendment Agreement, dated as of June 1, 1998."
"Collateral shall mean the Pledged Collateral, the UCC
Collateral, the Intellectual Property Collateral and the Real Property."
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"Collateral Documents shall mean collectively, the Indemnity
Agreements, the Mortgages, the Pledge Agreements, the Security Agreements, the
Patent, Trademark and Copyright Assignments, the Intercreditor Agreements and
each other agreement providing for a security interest in and/or lien on the
Collateral."
"Environmental Complaint shall mean any written complaint by any
Person or Official Body setting forth a cause of action for personal injury or
property damage, natural resource damage, contribution or indemnity for response
costs, civil or administrative penalties, criminal fines or penalties, or
declaratory or equitable relief arising under any Environmental Laws or any
order, notice of violation, citation, subpoena, request for information or other
written notice or demand of any type issued by an Official Body pursuant to any
Environmental Laws."
"Environmental Condition shall mean any conditions of the
environment, including the workplace, the ocean, natural resources (including
flora or fauna), soil, surface, water groundwater, any actual or potential
drinking water supply sources, substrata or the ambient air, relating to or
arising out of, or caused by, the use, handling, storage, treatment, recycling,
generation, transportation, release, spilling, leaking, pumping, emptying,
discharging, injecting, escaping, leaching, disposal, dumping, threatened
release or other management or mismanagement of Regulated Substances resulting
from the use of, or operations on, any owned or leased real property of the
Borrower or any Subsidiary."
"First Amendment Effective Date shall mean January 21, 2000,
which is the effective date of Amendment No. 1 to the Credit Agreement."
"Hobet Dragline Lease shall mean the lease dated as of March 1,
1983, between Kanawha Valley Bank, N.A., as Owner Trustee, Lessor, and Hobet
Mining & Construction Co., Inc., as Lessee, as amended through the Sixth
Amendment thereto, dated as of June 1, 1998."
"Indemnity Agreements shall mean collectively the Indemnity
Agreements with respect to the Real Property subject to a Mortgage, in form and
substance acceptable to the Administrative Agent, executed and delivered by each
of the applicable Loan Parties to the Administrative Agent for the benefit of
the Lenders, and Indemnity Agreement shall mean any of the Indemnity
Agreements."
"Intellectual Property Collateral shall mean all of the property
described in the Patent, Trademark and Copyright Assignments."
"Intercreditor Agreements shall mean collectively the
Intercreditor Agreements in form and substance acceptable to the Administrative
Agent, and Intercreditor Agreement shall mean any of the Intercreditor
Agreements."
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"Mortgages shall mean collectively all of the mortgages and
leasehold mortgages in form and substance acceptable to the Administrative
Agent, with respect to certain Real Property of the Borrower and its Significant
Subsidiaries, executed and delivered by Borrower and each other applicable Loan
Party to the Administrative Agent for the benefit of the Lenders, and Mortgage
shall mean any of the Mortgages."
"Patent, Trademark and Copyright Assignments shall mean
collectively the Patent, Trademark and Copyright Collateral Assignments in form
and substance acceptable to the Administrative Agent, executed and delivered by
each of the Loan Parties to the Administrative Agent for the benefit of the
Lenders, and Patent Trademark and Copyright Assignment shall mean any of the
Patent Trademark and Copyright Assignments."
"Pledge Agreements shall mean collectively the Pledge Agreements
in form and substance acceptable to the Administrative Agent, as executed and
delivered by the applicable Loan Parties to the Administrative Agent for the
benefit of the Lenders, and Pledge Agreement shall mean any of the Pledge
Agreements."
"Pledged Collateral shall mean the property of the applicable
Loan Parties in which security interests are to be granted under the Pledge
Agreements."
"Prior Security Interest shall mean a valid and enforceable
perfected first-priority security interest under the Uniform Commercial Code in
the UCC Collateral and the Pledged Collateral which is subject only to Liens for
taxes not yet due and payable to the extent such prospective tax payments are
given priority by statute or, in the case of the UCC Collateral, Purchase Money
Security Interests as permitted hereunder."
"Real Property shall mean the real estate owned or leased by
certain of the Loan Parties, which is encumbered by the Mortgages."
"Security Agreements shall mean collectively the Security
Agreements in form and substance acceptable to the Administrative Agent,
executed and delivered by each of the applicable Loan Parties to the
Administrative Agent for the benefit of the Lenders and Security Agreement shall
mean any of the Security Agreements."
"Subordination Agreement shall mean the Subordination Agreement
(Intercompany) in form and substance acceptable to the Administrative Agent
executed and delivered by each Loan Party to the Administrative Agent for the
benefit of the Lenders."
"UCC Collateral shall mean the property of the Loan Parties in
which security interests are to be granted under the Security Agreements."
"Uniform Commercial Code shall have the meaning assigned to that
term in Section 5.1.24."
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(b) The definitions of Base Net Worth, Guaranty Agreement and Loan
Documents contained in Section 1.1 [Certain Definitions] of the Credit Agreement
are hereby amended and restated in their entirety as follows:
"Base Net Worth shall mean the sum of $163,000,000, plus 50% of
consolidated net income of the Borrower and its Subsidiaries (before the after-
tax effect of changes in accounting principles) for each fiscal quarter in which
net income was earned plus 80% of the net increase in Consolidated Tangible Net
Worth resulting from the issuance of any equity securities by the Borrower, for
the period from January 1, 2000 through the date of determination. In no event
shall Base Net Worth be reduced on account of a consolidated net loss for any
fiscal period."
"Guaranty Agreement shall mean the continuing Guaranty and
Suretyship Agreement in substantially the form of Exhibit 1.1(G)(2) executed and
delivered by each of the Guarantors to the Administrative Agent for the benefit
of the Lenders, as such agreement may be amended, restated, supplemented or
replaced from time to, with such amendment, restatement, supplement or
replacement to be in form and substance satisfactory to the Administrative
Agent."
"Loan Documents shall mean this Agreement, the Administrative
Agent's Letter, the Guaranty Agreement, the Notes, the Pledge Agreements, the
Mortgages, the Security Agreements, the Indemnity Agreements, the Intercreditor
Agreements, the Patent, Trademark and Copyright Assignment, Subordination
Agreement, and any other instruments, certificates or documents delivered or
contemplated to the delivered hereunder or thereunder or in connection herewith
or therewith as the same may be supplemented, amended, modified, restated or
replaced from time to time in accordance herewith or therewith, and Loan
Document shall mean any of the Loan Documents."
(c) Section 4.4.5 [Mandatory Prepayment Upon Issuance of Certain Debt
and Certain Equity] is hereby amended and restated in its entirety as follows:
"4.4.5 Mandatory Prepayment Upon Issuance of Certain Debt and
Certain Equity; Mandatory Reduction of Revolving Credit
Commitments.
Within five (5) Business Days of the issuance by the Borrower or
any Subsidiary of the Borrower (other than Excluded Subsidiaries), of any debt
or equity securities for cash proceeds (including any hybrid equity securities),
the Borrower shall make a mandatory prepayment of principal on the Term Loans
equal to 100% of the Net Cash Proceeds of any debt securities and equal to 50%
of the Net Cash Proceeds of any equity securities (each a "Mandatory
Prepayment"). Each Mandatory Prepayment first 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
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inverse order of scheduled maturities and second to the payment of the principal
amount of the Revolving Credit Loans (with the Revolving Credit Commitments
automatically and permanently reduced simultaneously with and in an amount equal
to the amount of Revolving Credit Loans prepaid), provided, however that the
Revolving Credit Commitments shall not be required to be reduced below
$150,000,000 with respect to prepayments pursuant to this Section 4.4.5. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Banks under Section 4.5.2 [Indemnity]. If the Borrower's senior unsecured
long-term debt, on a consolidated basis, is rated Investment Grade, then at any
time thereafter when the Borrower issues debt or equity securities if the senior
unsecured long-term debt of the Borrower is rated, as of the date of issuance of
such debt or equity securities, by either Xxxxx'x at Baa3 or better or Standard
& Poor's at BBB- or better, no Mandatory Prepayment pursuant to this Section
4.4.5 will be required to be made."
(d) Section 4.4.6 [Mandatory Prepayment Upon Sale of Assets.] is
hereby amended and restated in its entirety as follows:
"4.4.6 Mandatory Prepayment Upon Sale of Assets, Mandatory
Reduction of Revolving Credit Commitments.
Within five (5) Business Days of any sale of assets by any member
of the Arch Coal Group authorized by Section 7.2.4(v) [Disposition of Assets or
Subsidiaries], the Borrower shall make a mandatory prepayment in an amount equal
to the Net Cash Proceeds of such sale (as estimated in good faith by the
Borrower), with such prepayment to be applied first, 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 and second to the payment
of the principal amount of the Revolving Credit Loans (with the Revolving Credit
Commitments automatically and permanently reduced simultaneously with and in an
amount equal to the amount of Revolving Credit Loans prepaid), in either case,
together with accrued interest on such principal amount, provided, however that
the Revolving Credit Commitments shall not be required to be reduced below
$150,000,000 with respect to prepayments pursuant to this Section 4.4.6.. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Banks under Section 4.5.2 [Indemnity]. If the Borrower's senior unsecured
long-term debt, on a consolidated basis, is rated Investment Grade, then at any
time thereafter when any member of the Arch Coal Group sells assets in
accordance with Section 7.2.4(v), if the senior unsecured long-term debt of the
Borrower is rated, as of the date of such asset sale, by either Xxxxx'x at Baa3
or better or by Standards & Poor's at BBB- or better, no prepayment pursuant to
this Section 4.4.6 will be required to be made."
(e) The first sentence of Section 5.1.6 [Litigation] is hereby amended
and restated in its entirety as follows:
"Except as set forth on Schedule 5.1.6, there are no actions,
suits, proceedings or investigations pending or, to the knowledge of any Loan
Party, threatened against
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such Loan Party or any Subsidiary of such Loan Party at law or equity before any
Official Body which individually or in the aggregate could reasonably be
expected to result in a Material Adverse Change."
(f) The second sentence of clause (ii)(a) [Accuracy of Financial
Statements] of Section 5.1.7 [Financial Statements] is hereby amended and
restated in its entirety as follows:
"Since December 31, 1997, no Material Adverse Change has
occurred, except as set forth on Schedule 5.1.7."
(g) Section 5.1.18 [Environmental Matters] is hereby amended and
restated in its entirety as follows:
"5.1.18 Environmental Matters.
Except as set forth on Schedule 5.1.18:
(a) the Loan Parties and their Subsidiaries are and have been in
substantial compliance with all Environmental Laws, except where the failure to
so comply could not reasonably be expected to result in a Material Adverse
Change;
(b) neither any property of any Loan Party or any Subsidiary of
any Loan Party nor their respective operations conducted thereon violates any
order of any court of governmental authority made pursuant to Environmental Laws
except for noncompliance with respect thereto which could not reasonably be
expected to result in a Material Adverse Change;
(c) there are no threatened or pending Environmental Claims
against any Loan Party or any Subsidiary of any Loan Party which could
reasonably be expected to result in a Material Adverse Change; and
(d) neither any Loan Party nor any Subsidiary of any Loan Party
has received any notice from any governmental or regulatory authority regarding
actual or contingent liability in connection with any release or threatened
release of any Hazardous Substance into the environment which actual or
contingent liability could reasonably be expected to result in a Material
Adverse Change."
(h) The following new Sections 5.1.23 through 5.1.27 are hereby added
to Section 5 [Representations and Warranties] of the Credit Agreement:
"5.1.23 Patents, Trademarks, Copyrights, Licenses, Etc.
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Each Loan Party and each Subsidiary of each Loan Party owns or
possesses all the material patents, trademarks, service marks, trade names,
copyrights, licenses, registrations and franchises necessary to own and operate
its properties and to carry on its business as presently conducted and planned
to be conducted by such Loan Party or Subsidiary, without known possible,
alleged or actual conflict with the rights of others. All material patents,
trademarks, service marks, trade names, copyrights, licenses, registrations and
franchises of each Loan Party and each Subsidiary of each Loan Party are listed
and described on Schedule 5.1.23.
5.1.24 Security Interests.
The Liens and security interests granted to the Administrative
Agent for the benefit of the Lenders pursuant to the Patent, Trademark and
Copyright Assignment, the Pledge Agreements and the Security Agreements in the
Collateral (other than the Real Property) constitute and will continue to
constitute Prior Security Interests under the Uniform Commercial Code as in
effect in each applicable jurisdiction (the "Uniform Commercial Code") or other
applicable Law entitled to all the rights, benefits and priorities provided by
the Uniform Commercial Code or such Law. Upon the filing of financing statements
relating to said security interests in each office and in each jurisdiction
where required in order to perfect the security interests described above,
taking possession of any stock certificates or other certificates evidencing the
Pledged Collateral and recordation of the Patent, Trademark and Copyright
Assignment in the United States Patent and Trademark Office and United States
Copyright Office, as applicable, all such action as is necessary or advisable to
establish such rights of the Agent will have been taken, and there will be upon
execution and delivery of the Patent, Trademark and Copyright Assignment, the
Pledge Agreements and the Security Agreements, such filings and such taking of
possession, no necessity for any further action in order to preserve, protect
and continue such rights, except the filing of continuation statements with
respect to such financing statements within six months prior to each five-year
anniversary of the filing of such financing statements or within not less than
six months prior to such other longer anniversary date in any jurisdiction (and
the Borrower shall notify the Administrative Agent, in writing if such
anniversary date is other than five years). All filing fees and other expenses
in connection with each such action have been or will be paid by the Borrower.
5.1.25 Mortgage Liens.
The Liens granted to the Administrative Agent for the benefit of
the Lenders pursuant to the Mortgages constitute valid first priority Liens
under applicable law. All such action as will be necessary or advisable to
establish such Liens of the Administrative Agent and their priority as described
in the preceding sentence will be taken at or prior to the time required for
such purpose, and there will be as of the date of execution and delivery of the
Mortgages no necessity for any further action in order to protect, preserve and
continue such Liens and such priority, except for the approval of the U.S.
Bureau of Land Management necessary for the Lenders to exercise their rights and
remedies under the Mortgage for the Thundercloud property.
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5.1.26 Status of Pledged Collateral.
All the shares of capital stock, Partnership Interests or LLC
Interests included in the Pledged Collateral to be pledged pursuant to the
Pledge Agreements are or will be upon issuance validly issued and nonassessable
and owned beneficially and of record by the pledgor free and clear of any Lien
or restriction on transfer, except as otherwise provided by the Pledge
Agreements and except as the right of the Lenders to dispose of the shares of
capital stock, Partnership Interests or LLC Interests may be limited by the
Securities Act of 1933, as amended, and the regulations promulgated by the SEC
thereunder and by applicable state securities laws. There are no shareholder,
partnership, limited liability company or other agreements or understandings
with respect to the shares of capital stock, Partnership Interests or LLC
Interests included in the Pledged Collateral except for the partnership
agreements and limited liability company agreements described on Schedule
5.1.26. The Loan Parties have delivered true and correct copies of such
partnership agreements and limited liability company agreements to the
Administrative Agent.
5.1.27 Maintenance of Patents and Trademarks
Except as set forth on Schedule 5.1.27, each Loan Party shall,
and shall cause each of its Subsidiaries to, maintain in full force and effect
all patents, trademarks, service marks, trade names, copyrights, licenses and
franchises necessary for the ownership and operation of its properties and
business if the failure so to maintain the same would constitute a Material
Adverse Change."
(i) Section 7.1.3 [Maintenance of Insurance] is hereby amended and
restated in its entirety as follows:
"7.1.3 Maintenance of Insurance.
Each Loan Party shall, and shall cause each of its Subsidiaries
to, insure its properties and assets against loss or damage by fire and such
other insurable hazards as such assets are commonly insured (including fire,
extended coverage, property damage, workers' compensation, public liability and
business interruption insurance) and against other risks (including errors and
omissions) in such amounts as similar properties and assets are insured by
prudent companies in similar circumstances carrying on similar businesses, and
with reputable and financially sound insurers, including self-insurance to the
extent customary. At the request of the Administrative Agent, the Loan Parties
shall deliver to the Administrative Agent and each of the Lenders (x) on each
anniversary of the Closing Date and such other date as the Administrative Agent
shall reasonably request an original certificate of insurance signed by the Loan
Parties' independent insurance broker describing and certifying as to the
existence of the insurance on the Collateral required to be maintained by this
Agreement and the other Loan Documents, together with a copy of the endorsement
described in the next sentence attached to such certificate and (y) from time to
time a summary schedule indicating all insurance then in
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force with respect to each of the Loan Parties. Such policies of insurance shall
contain special endorsements required by the provisions of the Collateral
Documents and shall be in form and substance acceptable to the Administrative
Agent, including, without limitation, specifying the Collateral Agent as an
additional insured, mortgagee and lender loss payee as its interests may appear,
with the understanding that any obligation imposed upon the insured (including
the liability to pay premiums) shall be the sole obligation of the applicable
Loan Parties and not that of the insured. The applicable Loan Parties shall
notify the Administrative Agent promptly of any occurrence causing a material
loss or decline in value of the Collateral and the estimated (or actual, if
available) amount of such loss or decline. If no Event of Default exists, any
monies received by the Loan Parties constituting insurance proceeds or
condemnation proceeds (pursuant to the Mortgages) may, at the option of the
Borrower (i) be applied by the Borrower to the payment of the Loans in such
manner as the Borrower may reasonably determine, or (ii) be disbursed for the
repair or restoration of such property and/or replacement with other operating
assets. If an Event of Default exists, any monies received by the Loan Parties
or the Administrative Agent constituting insurance proceeds or condemnation
proceeds (pursuant to the Mortgages) may, at the option of the Administrative
Agent, (i) be applied by the Administrative Agent to the payment of the Loans in
such manner as the Administrative Agent may reasonably determine, or (ii) be
disbursed to the applicable Loan Parties on such terms as are deemed appropriate
by the Administrative Agent for the repair, restoration and/or replacement of
property in respect of which such proceeds were received."
(j) Section 7.1 [Affirmative Covenants] is hereby amended to add the
following new Sections 7.1.12 through 7.1.14:
"7.1.12 Execution and Delivery of Collateral Documents.
The Borrower shall, and shall cause each of its Significant
Subsidiaries to use its best efforts to complete the following on or before
March 17, 2000, but if after so endeavoring such matters are not completed by
March 17, 2000, the Borrower shall, and shall cause each of its Significant
Subsidiaries to complete the following as promptly as possible thereafter, but
no later than May 17, 2000:
(a) grant to the Collateral Agent for the benefit of the Lenders
a Prior Security Interest in the accounts receivable, inventory and the material
patents, trademarks and copyrights of the Borrower and each Significant
Subsidiary (other than a pledge of such assets of Apogee Coal Company, a
Delaware corporation), and in the equity interests of the Subsidiaries of the
Borrower set forth on Schedule 7.1.12, including, without limitation, by
executing a Security Agreement, a Pledge Agreement, the Subordination Agreement,
and a Patent, Trademark and Copyright Assignment;
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(b) cause the Borrower to grant to the Collateral Agent for the
benefit of the Lenders a Prior Security Interest in all of the outstanding
capital stock of AWAC, including, without limitation, by executing a Pledge
Agreement;
(c) as applicable, execute and deliver Mortgages on a first
priority perfected basis and Indemnity Agreements, with respect to the Real
Property set forth on Schedule 7.1.12 hereto;
(d) execute and deliver Intercreditor Agreements (i) required by
any other creditor of the Borrower or any of its Significant Subsidiaries under
the Apogee Synthetic Lease and the Hobet Dragline Lease, (ii) to the extent
necessary for the Borrower and its Significant Subsidiaries to provide the
Collateral to the Collateral Agent in accordance with the requirements of this
Section 7.1.12, and (iii) necessary to share the Collateral on a pro-rata, pari
passu basis with any lender entering into, on a secured basis, any interest rate
swap or similar transaction with the Borrower or any Significant Subsidiary of
the Borrower;
(e) amend, restate, ratify and confirm the Guaranty Agreement to
which such Significant Subsidiary is a party to give effect to the Prior
Security Interest of the Collateral Agent for the benefit of the Lenders in the
Collateral pursuant to the Collateral Documents;
(f) provide such UCC, lien, judgment, and tax lien searches with
respect to the properties and assets of the Borrower and its Significant
Subsidiaries as the Administrative Agent may request, all at the expense of the
Borrower, with all such searches and the results thereof to be in scope, form
and substance satisfactory to the Administrative Agent;
(g) in connection with the granting of the liens and security
interests under the Collateral Documents and the execution, delivery and
performance of the Intercreditor Agreements, provide such opinions of counsel as
the Administrative Agent may request, with such opinions to be satisfactory in
form and substance to the Administrative Agent;
(h) deliver to the Administrative Agent copies of all filing
receipts and acknowledgments issued by any governmental authority to evidence
any recordation or filing necessary to perfect the Lien of the Lenders on the
Collateral or other satisfactory evidence of such recordation and filing,
together with evidence in a form acceptable to the Administrative Agent that
such Lien constitutes a Prior Security Interest for the benefit of the Lenders
and, in the case of the Mortgages, a valid and perfected first priority Lien;
(i) deliver to the Administrative Agent copies of all consents
and approvals of third parties or any Official Body required for the Borrower
and its Significant Subsidiaries to grant the Liens and security interests
required by this Section 7.1.12, other than approvals and consents from the U.S.
Bureau of Land Management necessary for the Lenders to exercise their rights and
remedies with respect to the Mortgage applicable to Borrower's Thundercloud
tract.;
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(j) make available to the Administrative Agent a list of all Real
Property of the Borrower and its Significant Subsidiaries together with a copy
of all lease agreements with respect to their respective leased Real Property
and make available to the Administrative Agent the books and records of the
Borrower and its Significant Subsidiaries with respect to such Real Property,
including without limitation, copies of any property maps, surveys, title
commitments, title reports, mining permits and title insurance;
(k) deliver to the Administrative Agent a list of all Significant
Subsidiaries of the Borrower specifying the authorized and outstanding equity
interests thereof, the owner of such equity interests, the jurisdiction of
formation thereof, and each jurisdiction where such Significant Subsidiary owns
assets or operates its business;
(l) deliver to the Administrative Agent (i) an original
certificate of insurance signed by the Loan Parties' independent insurance
broker describing and certifying as to the existence of the insurance on the
Collateral required to be maintained by this Agreement and the other Loan
Documents, together with a copy attached thereto of the endorsements required by
the provisions of the Collateral Documents, all in form and substance acceptable
to the Administrative Agent, including, without limitation, an endorsement
specifying the Collateral Agent as an additional insured, mortgagee and lender
loss payee as its interests may appear, and (ii) a summary schedule indicating
all insurance then in force with respect to each of the Loan Parties; and
(m) deliver to the Administrative Agent such reports and
assessments as the Administrative Agent reasonably requests with respect to the
environmental condition of the Loan Parties' and their Significant Subsidiaries'
assets and shall cause an Authorized Officer of the applicable Loan Parties to
deliver to the Administrative Agent, in form and substance satisfactory to the
Administrative Agent, a certificate from the Borrower's General Counsel to the
effect that to his best knowledge, the Loan Parties have made known to the
Administrative Agent all information known to them and their Significant
Subsidiaries concerning material Environmental Conditions and Environmental
Complaints which could reasonably be expected to result in a Material Adverse
Change.
7.1.13 Further Assurances.
Each Loan Party shall, from time to time, at its expense,
faithfully preserve and protect the Collateral Agent's Lien on and Prior
Security Interest in the Collateral as a continuing first priority perfected
Lien, subject only to Permitted Liens, and shall do such other acts and things
as the Administrative Agent or the Collateral Agent in their sole discretion may
deem necessary or advisable from time to time in order to preserve, perfect and
protect the Liens granted under the Loan Documents and to exercise and enforce
its rights and remedies thereunder with respect to the Collateral, including,
without limitation, obtaining necessary approvals and consents from the U.S.
Bureau of Land Management necessary for the Lenders to
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exercise their rights and remedies with respect to the Mortgage applicable to
Borrower's Thundercloud tract.
7.1.14 Subordination of Intercompany Loans.
Each Loan Party shall cause any intercompany Indebtedness, loans
or advances owed by any Loan Party to any other Loan Party to be subordinated
pursuant to the terms of the Subordination Agreement."
(k) Clause (ii) of Section 7.2.1 [Indebtedness] is hereby amended to
delete "$300,000,000" therein and insert in lieu thereof "$150,000,000".
(l) Section 7.2.2 [Liens] of the Credit Agreement is hereby amended
and restated in its entirety as follows:
"7.2.2 Liens.
The Borrower shall not, and shall not permit AWAC or any member
of the Arch Coal Group to, (i) at any time create, incur, assume or suffer to
exist any Lien on any of its respective property or assets, tangible or
intangible, now owned or hereafter acquired, or agree or become liable to do so,
except Liens in favor of the Collateral Agent for the benefit of the Lenders
under the Loan Documents and, in the case of the Borrower and the Arch Coal
Group, except Permitted Liens so long as the aggregate amount of all payments by
any such Person in respect of all Indebtedness secured by such Permitted Liens
does not at any time exceed five percent (5%) of the total assets of the Arch
Coal Group (exclusive of Investment in the Arch Western Group), as determined
and consolidated in accordance with GAAP; or (ii) at any time, directly or
indirectly, enter into any agreement (other than the Apogee Synthetic Lease and
the Hobet Dragline Lease), understanding or other arrangement which purports to
prohibit or limit in any manner the ability of AWAC or any member of the Arch
Coal Group to grant security interests or Liens with respect to any of its
respective property or assets that have not theretofore been encumbered or made
subject to the grant of a security interest."
(m) Subclause (ii) of Clause (3) of Section 7.2.3 [Liquidations,
Mergers, Consolidations, Acquisitions.] is hereby amended and restated in its
entirety as follows:
"(ii) the business acquired, or the business conducted by the
Person whose ownership interests are being acquired, as applicable, shall be
substantially the same as one or more line or lines of business conducted by the
Loan Parties and shall comply with Section 7.2.7 [Continuation of or Change in
Business], all of the accounts receivable, inventory, owned real property,
material patents, trademarks and copyrights and equity interests of the business
or Person acquired shall be pledged to the Administrative Agent for the benefit
of the Lenders on a first priority perfected basis pursuant to Pledge
Agreements, Mortgages, Security Agreements, Patent, Trademark and Copyright
Assignments, and such other Collateral
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Documents as are necessary to create a Prior Security Interest in such assets,
to the extent that a Significant Subsidiary is acquired or formed in connection
with or as a result of such acquisition, the Loan Parties shall comply with the
provisions of Section 7.2.6 [Subsidiaries, Partnerships and Joint Ventures] and
Section 10.18 [Joinder of Guarantors], and in connection with such acquisition
and the granting of such Liens and security interests, the Borrower shall
deliver to the Administrative Agent for the benefit of the Lenders such opinions
of counsel, certificates and such other Loan Documents as the Administrative
Agent may reasonably request;"
(n) Clause (c) of subsection (iv) of Section 7.2.4 [Dispositions of
Assets or Subsidiaries.] is hereby amended and restated in its entirety as
follows:
"(c) the aggregate net book value, as determined in accordance
with GAAP, of all assets so sold by the Borrower and its Subsidiaries shall not
exceed in any calendar year $40,000,000;"
(o) Section 7.2.6 [Subsidiaries, Partnership, and Joint Ventures] of
the Credit Agreement is hereby amended and restated in its entirety as follows:
"7.2.6 Subsidiaries, Partnerships and Joint Ventures.
The Borrower shall not, and shall not permit any of its
Subsidiaries to, own or create directly or indirectly any Subsidiaries other
than (i) the Excluded Subsidiaries, (ii) Subsidiaries which are not Significant
Subsidiaries and (iii) any Significant Subsidiary which has joined the Guaranty
Agreement as Guarantor, whose accounts receivable, inventory, owned real
property, material patents, trademarks and copyrights and equity interests owned
in any other Person (other than any member of the Arch Western Group) are
pledged to the Collateral Agent for the benefit of the Lenders on a first
priority perfected basis pursuant to a Security Agreement, Mortgage(s), Patent,
Trademark and Copyright Assignment, and Pledge Agreement, who has executed all
other Loan Documents, who has also delivered to the Administrative Agent such
opinions of counsel and other documents in connection therewith as the
Administrative Agent may reasonably request, and who has caused all of the
issued and outstanding capital stock, partnership interests, member interests or
other equity interest of such Significant Subsidiary that are owned by the
Borrower or another Subsidiary of the Borrower to be pledged on a first priority
perfected basis to the Collateral Agent for the benefit of the Lenders pursuant
to the Pledge Agreement, all in form and substance satisfactory to the
Administrative Agent. Neither the Borrower nor any Subsidiary of the Borrower
shall become or agree to become a general or limited partner in any general or
limited partnership or become a member or manager of, or hold a limited
liability company interest in, a limited liability company, except that (1) the
Loan Parties may make an Investment in a Permitted Joint Venture; provided,
however, that the aggregate permitted Investments in all Permitted Joint
Ventures shall not at any time exceed, for all Loan Parties and their
Subsidiaries, $50,000,000, or (2) the Loan Parties may be general or limited
partners in other Loan Parties or be members or managers of, or hold limited
liability company interests in, other Loan Parties and except that the Borrower
may hold a limited
-13-
liability company interest in Arch Western and Arch Western may hold limited
liability company interests in its Subsidiaries which are members of the Arch
Western Group."
(p) Section 7.2.9 [Off-Balance Sheet Financing] is hereby amended by
deleting in the first sentence thereof "7.5%" and inserting in lieu thereof
"5%".
(q) Section 7.2.10 [Maximum Leverage Ratio] of the Credit Agreement is
hereby amended and restated in its entirety as follows:
"7.2.10 Maximum Leverage Ratio.
The Borrower shall not at any time permit the Leverage Ratio to
exceed the ratio set forth below for the periods specified below:
Period Ratio
------ -----
Closing Date through and including
December 31, 1998 4.50 to 1.00
January 1, 1999 through and including
September 30, 2000 4.25 to 1.00
October 1, 2000 through and including
December 31, 2001 4.00 to 1.00
January 1, 2002 and thereafter 3.00 to 1.00"
(r) Section 7.2.11 [Minimum Fixed Charge Coverage Ratio] is hereby
amended and restated in its entirety as follows:
"7.2.11 Minimum Fixed Charge Coverage Ratio.
The Borrower shall not permit the Fixed Charge Coverage Ratio to
be less than the ratio set forth below for the periods specified below:
Period Ratio
------ -----
Closing Date through and including
December 31, 1998 2.50 to 1.00
January 1, 1999 through and including
September 30, 2000 2.75 to 1.00
-14-
October 1, 2000 through and including
December 31, 2000 3.00 to 1.00
January 1, 2001 and thereafter 3.25 to 1.00"
(s) Section 7.2. [Negative Covenants] is hereby amended to add the
following new Section 7.2.16 [Prohibited Transactions With Respect to AWAC]:
"7.2.16 Prohibited Transactions With Respect to AWAC
The Borrower shall not permit AWAC to: (i) incur any indebtedness or
other obligation or liabilities (whether matured or unmatured, liquidated or
unliquidated, direct or indirect, absolute or contingent, or joint or several);
and (ii) own any asset other than its member interest in Arch Western."
(t) Section 10.18 [Joinder of Guarantors] is hereby amended and
restated in its entirety to read as follows:
"10.18 Joinder of Guarantors.
Any Significant Subsidiary of the Borrower which is required to become
a Guarantor pursuant to Section 7.2.6. [Subsidiaries, Partnerships and Joint
Ventures] shall execute and deliver to the Administrative Agent (i) a Guarantor
Joinder in substantially the form attached hereto as Exhibit 1.1(G)(1) pursuant
to which it shall join as a Guarantor each of the documents to which the
Guarantors are parties; (ii) all of the other Loan Documents required by Section
7.2.6, and (iii) documents in the forms described in Section 6.1 [First Loans
and Letters of Credit] modified as appropriate to relate to such Subsidiary."
(u) Schedule 1.1(A) Part A- Pricing Grid of the Credit Agreement is
hereby amended and restated in its entirety as set forth on the schedule titled
as Schedule 1.1(A) Part A attached hereto.
(v) Schedule 1.1(B) of the Credit Agreement [Commitments of Banks and
Addresses for Notices] is hereby amended and restated in its entirety as set
forth on the schedule titled as Schedule 1.1(B) attached hereto.
(w) Exhibit 7.3.3 of the Credit Agreement [Quarterly Compliance
Certificate] is hereby amended and restated in its entirety as set forth on the
exhibit titled as Exhibit 7.3.3 attached hereto.
(x) The following new schedules and exhibits attached hereto are
hereby added as new schedules and exhibits to the Credit Agreement:
-15-
Schedules
---------
5.1.6 Litigation
5.1.7 Certain Disclosures Regarding Financial Statements
5.1.18 Certain Disclosures Regarding Environmental Matters
5.1.23 Patents, Trademarks, Copyrights, Licenses, etc.
5.1.26 Partnership Agreements; LLC Agreements
7.1.12 Owned and Leased Real Property of Loan Parties; Certain
Equity Interests of Subsidiaries to be Pledged
3. Conditions of Effectiveness of Amendments.
The effectiveness of the Amendments of Credit Agreement set forth in
Section 2 hereof is expressly conditioned upon satisfaction of each of the
following conditions precedent:
(a) Officer's Certificate.
The representations and warranties of the Borrower contained in
Section 5 of the Credit Agreement including as amended by the modifications and
additional representations and warranties of this Amendment, and of each Loan
Party in each of the other Loan Documents shall be true and accurate on and as
of the date hereof with the same effect as though such representations and
warranties had been made on and as of such date (except representations and
warranties which relate solely to an earlier date or time, which representations
and warranties shall be true and correct on and as of the specific dates or
times referred to therein), and each of the Loan Parties shall have performed
and complied with all covenants and conditions hereof and thereof, no Event of
Default or Potential Default shall have occurred and be continuing or shall
exist; and there shall be delivered to the Administrative Agent for the benefit
of each Lender a certificate of the Borrower dated the date hereof and signed by
the Chief Executive Officer, President or Chief Financial Officer of the
Borrower to each such effect.
(b) 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 or an Assistant Secretary of each of the Loan Parties, certifying as
appropriate as to:
(1) all action taken by each Loan Party in connection with this
Amendment and the other Loan Documents;
(2) the names of the officer or officers authorized to sign this
Amendment and the other Loan Documents and the true signatures of such officer
or officers and specifying the Authorized Officers permitted to act on behalf of
each Loan Party for purposes of
-16-
this Agreement and the true signatures of such officers, on which the
Administrative Agent and each Lender may conclusively rely; and
(3) copies of its organizational documents, including its
certificate of incorporation and bylaws as in effect on the date hereof and, in
the case of the certificate of incorporation of the Borrower, 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 Borrower in the state of its
formation and the state of its principal place of business.
(c) Opinion of Counsel.
There shall be delivered to the Administrative Agent for the
benefit of each Lender a written opinion of Xxxxxx Xxxxx, the General Counsel
for the Loan Parties (who may rely on the opinions of such other counsel as may
be acceptable to the Administrative Agent), dated the date hereof and in form
and substance satisfactory to the Administrative Agent and its counsel as to
such matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request.
(d) No Actions or Proceedings.
No action, proceeding, investigation, regulation or legislation
shall have been instituted, threatened or proposed before any court,
governmental agency or legislative body to enjoin, restrain or prohibit, or to
obtain damages in respect of, this Amendment, the other Loan Documents or the
consummation of the transactions contemplated hereby or thereby or which, in the
Administrative Agent's sole discretion, would make it inadvisable to consummate
the transactions contemplated by this Agreement or any of the other Loan
Documents.
(e) Payment of Fees.
The Borrower shall pay or cause to be paid to the Administrative
Agent for itself and for the account of the Lenders an amendment fee (the
"Amendment Fee") payable to those Lenders which approve this Amendment on or
before noon (Pittsburgh, Pennsylvania time) on Friday, January 21, 2000, in the
amount of the product of 25 basis points multiplied by the amount of such
Lender's Commitments and the other fees, costs and expenses payable to the
Administrative Agent or for which the Administrative Agent is entitled to be
reimbursed, including but not limited to the fees and expenses of the
Administrative Agent's legal counsel.
(f) Consents.
All material consents required to effectuate the transactions
contemplated by the Amendment and the other Loan Documents and shall have been
obtained.
-17-
(g) Officer's Certificate.
There shall have been delivered to the Administrative Agent for
the benefit of each Lender a certificate dated the date hereof, in form and
substance satisfactory to the Administrative Agent and signed by the Chief
Executive Officer, President or Chief Financial Officer of the Borrower
certifying the accuracy of all representations and warranties by the Loan
Parties under the Loan Documents, the compliance with all covenants under the
Loan Documents and the absence of any Event of Default or Potential Default.
(h) Legal Details.
All legal details and proceedings in connection with the
transactions contemplated by this Amendment and the other Loan Documents shall
be in form and substance satisfactory to the Administrative Agent and counsel
for the Administrative Agent, and the Administrative Agent shall have received
all such other counterpart originals or certified or other copies of such
documents and proceedings in connection with such transactions, in form and
substance satisfactory to the Administrative Agent and its counsel, as the
Administrative Agent or its counsel may reasonably request.
4. Consent to Negotiation, Execution and Delivery of the Collateral
Documents by the Administrative Agent. By execution of this Amendment, each
Agent and each Lender acknowledges that it has reviewed a copy of the Credit
Agreement as amended hereby and hereby consents and agrees to: (a) the
acceptance by the Administrative Agent on behalf of each Lender of the
Collateral from the Loan Parties to secure the Obligations of the Borrower, AWAC
and each Significant Subsidiary of the Borrower to the Lenders; (b) the service
by the Administrative Agent as Collateral Agent (as defined in the Intercreditor
Agreements) on behalf of each Agent and each Lender with respect to the
Collateral Documents and the Collateral; and (c) the negotiation, execution and
delivery or acceptance, as applicable, of the Collateral Documents by the
Administrative Agent on behalf of each Agent and each Lender.
5. Force and Effect. Except as otherwise expressly modified by this
Amendment, the Credit Agreement and the other Loan Documents are hereby ratified
and confirmed and shall remain in full force and effect after the date hereof.
6. Governing Law. This Amendment shall be deemed to be a contract
under the laws of the Commonwealth of Pennsylvania and for all purposes shall be
governed by and construed and enforced in accordance with the internal laws of
the Commonwealth of Pennsylvania without regard to its conflict of laws
principles.
7. Effective Date; Certification of the Borrower. This Amendment
shall be dated as of and shall be binding, effective and enforceable upon the
date of (i) satisfaction of all conditions set forth in Section 3 hereof and
(ii) receipt by the Administrative Agent of duly executed original counterparts
of this Amendment from the Borrower and the Required Banks,
-18-
and from and after such date this Amendment shall be binding upon the Borrower,
each Lender and the Agents, and their respective successors and assigns
permitted by the Credit Agreement. The Borrower by executing this Amendment,
hereby certifies that this Amendment has been duly executed and that as of the
date hereof no Event of Default or Potential Default exists under the Credit
Agreement or the other Loan Documents.
8. No Novation. This Amendment amends the Credit Agreement, but is
not intended to constitute, and does not constitute, a novation of the
Obligations of the Loan Parties under the Credit Agreement.
[Intentionally Blank]
-19-
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly
authorized, have executed this Amendment No. 1 to Credit Agreement as of the day
and year first above written.
ARCH COAL, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
--------------------------------
Title: Senior Vice President
-------------------------------
PNC BANK, NATIONAL ASSOCIATION,
individually and as Administrative Agent
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------
Title: Vice President
-------------------------------
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK, individually
and as Syndication Agent
By: /s/ Xxxxxx Xxxxxxxxx
----------------------------------
Title: Vice President
-------------------------------
FIRST UNION NATIONAL BANK,
individually and as Documentation Agent
By: /s/ Xxxxx Xxxxx
----------------------------------
Title: Vice President
-------------------------------
BANK OF AMERICA, N.A. (formerly
NationsBank, N.A.)
By: /s/ Xxxx X. Xxxxx
----------------------------------
Title: Vice President
-------------------------------
BANK OF MONTREAL
By: /s/ Xxx X. Xxxxxxx
----------------------------------
Title: Director
-------------------------------
-00-
XXX XXXX XX XXX XXXX
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------------
Title: Vice President
--------------------------------------
THE BANK OF NOVA SCOTIA
By: /s/ F. C. H. Xxxxx
-----------------------------------------
Title: Senior Manager Loan Operations
--------------------------------------
BARCLAYS BANK PLC
By: /s/ Xxxxxxxx X. Xxxx
-----------------------------------------
Title: Director, Loan Transaction Management
-------------------------------------
THE CHASE MANHATTAN BANK
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Title: Vice President
--------------------------------------
THE BANK OF TOKYO-MITSUBISHI,
LTD., CHICAGO BRANCH
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------------
Title: Deputy General Manager
--------------------------------------
CREDIT LYONNAIS NEW YORK
BRANCH
By: /s/ Illegible Signature
-----------------------------------------
Title: Vice President
--------------------------------------
NATIONAL BANK OF KUWAIT, SAK
By: /s/ Xxxxxx X. XxXxxxx
-----------------------------------------
Title: Executive Manager
--------------------------------------
By: /s/ Xxxxxxxx Xxxxx
-----------------------------------------
Title: General Manager
--------------------------------------
-21-
BANQUE NATIONALE DE PARIS
By: /s/ Xxxxxx Xxxxxx du Xxxxxx
----------------------------------------
Title: Executive Vice President and
-------------------------------------
General Manager
-------------------------------------
BANK ONE, NA (formerly known as The
First National Bank of Chicago)
By: /s/ Xxxx Xx X. Xxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
THE DAI-ICHI KANGYO BANK, LTD.
By: /s/ Nobuyasu Fukatsu
----------------------------------------
Title: General Manager
-------------------------------------
THE INDUSTRIAL BANK OF JAPAN,
LIMITED
By: /s/ Xxxxxx Xxxxx
----------------------------------------
Title: Joint General Manager
-------------------------------------
MERCANTILE BANK NATIONAL
ASSOCIATION
By: /s/ Xxxxxxx Xxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
ABN AMRO BANK, N.V.
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Xxxxx X. XxXxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
-22-
DRESDNER BANK A.G. NEW YORK
AND GRAND CAYMAN BRANCHES
By: /s/ P. Xxxxxxx Xxxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
BANK HAPOALIM B.M.
By: /s/ Illegible Signature
----------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Illegible Signature
----------------------------------------
Title: Vice President
-------------------------------------
CIBC, INC.
By: /s/ Xxxxxx Xxxxxx
----------------------------------------
Title: Executive Director
-------------------------------------
FLEET NATIONAL BANK
By:
----------------------------------------
Title:
-------------------------------------
KEYBANK NATIONAL BANK
By: /s/ Xxxxx Xxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxxx
----------------------------------------
Title: Duly Authorized Signatory
-------------------------------------
-23-
GULF INTERNATIONAL BANK
By: /s/ Abdel-Fattah Tahoun
----------------------------------------
Title: Senior Vice President
-------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------
Title: Vice President
-------------------------------------
BANK POLSKA KASA OPIEKI S.A.,
NEW YORK BRANCH (formerly Bank
Polska Kasa Opieki S.A. Pekao S.A. Group,
New York Branch)
By: /s/ Illegible Signature
----------------------------------------
Title: Vice President
-------------------------------------
ARAB BANK PLC
By: /s/ Illegible Signature
----------------------------------------
Title: Executive Vice President &
-------------------------------------
Regional Manager
-------------------------------------
CREDIT INDUSTRIEL ET
COMMERCIAL (formerly Compagnie
Financiere de Cic et de L'Union
Europeenne)
By: /s/ Xxxxx X'Xxxxx
----------------------------------------
Title: Vice President
-------------------------------------
By: /s/ Xxxxxxx Xxxx
----------------------------------------
Title: Vice President
-------------------------------------
BANK LEUMI USA
By: /s/ Xxxxx Xxx Hong
----------------------------------------
Title: Vice President
-------------------------------------
-24-
SCHEDULE 1.1(A)
PART (A)
PRICING GRID
Applicable Facility Revolving Credit Letter of Term Loan
Level Leverage Ratio Fee Euro-Rate Spread Credit Fee Euro-Rate Spread
---------------------------------------------------------------------------------------------------------
Less than or
I equal to 2.0 to .20% .675% .675% .875%
1.0
---------------------------------------------------------------------------------------------------------
Greater than
2.0 to 1.0 .225% .75% .750% .975%
II but less than or
equal
to 2.5 to 1.0
---------------------------------------------------------------------------------------------------------
Greater than
2.5 to 1.0 .25% .775% .775% 1.025%
III but less than or
equal
to 3.0 to 1.0
---------------------------------------------------------------------------------------------------------
Greater than
3.0 to 1.0 .275% .975% .975% 1.250%
IV but less than or
equal
to 3.5 to 1.0
---------------------------------------------------------------------------------------------------------
Greater than
3.5 to 1.0 .30% 1.20% 1.20% 1.500%
V but less than or
equal
to 4.0 to 1.0
---------------------------------------------------------------------------------------------------------
Greater than
VI 4.0 to 1.0 .40% 1.35% 1.35% 1.750%
---------------------------------------------------------------------------------------------------------
(a) Applicable Leverage Ratio means, at any date, the Leverage Ratio as at
the last day of the fiscal quarter of the Borrower most recently ended prior to
such date, for which the Borrower has delivered financial statements pursuant to
Section 7.3.1 or 7.3.2, as the case may be, together with the duly executed
compliance certificate required by Section 7.3.3; provided that if the Borrower
shall fail to timely deliver the financial statements required to be delivered
by it pursuant to Section 7.3.1 or 7.3.2, as the case may be, together with the
duly executed compliance certificate required by Section 7.3.3, the Applicable
Leverage Ratio for each date from and including the date on which such
statements are required to be delivered until the date on which such statements
are delivered shall be deemed to be greater than 4.0:1.
(b) It is expressly agreed that through and including the Initial Delivery
Date, the Applicable Margin, Applicable Facility Fee Rate and Applicable Letter
of Credit Fee Rate shall be such rates as determined in accordance with
paragraph (a) above but shall be no less than the respective amounts set forth
under Level IV of Part (A) of Schedule 1.1(A). It is expressly agreed that after
the Initial Delivery Date until such time as the Borrower's senior unsecured
long-term debt, on a consolidated basis, has been rated Investment Grade, the
Applicable Margin, Applicable Facility Fee Rate and Applicable Letter of Credit
Fee Rate shall be determined based upon Part (A) of Schedule 1.1(A), and for any
period thereafter when a Debt Rating is in effect, the Applicable Margin,
Applicable Facility Fee Rate and Applicable Letter of Credit Fee Rate shall be
the respective amounts determined under Part (B) of Schedule 1.1(A). If, at any
time during any period when Applicable Margin, Applicable Facility Fee Rate and
Applicable Letter of Credit Fee Rate are determined based upon this Part (A) of
Schedule 1.1(A), the Borrower's "senior corporate credit rating" is rated either
BB- or lower by Standard & Poor's or the Borrower's "senior implied issuer
rating" is rated Ba3 or lower by Xxxxx'x, the Applicable Margin and the
Applicable Letter of Credit Rate set forth above will be increased by .50%.
SCHEDULE 1.1(B)
COMMITMENTS OF BANKS AND ADDRESSES FOR NOTICES
ARCH COAL, INC. CREDIT FACILITY
Part 1 - Commitments of Banks and Addresses for Notices to Banks
----------------------------------------------------------------
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- ------------- ---------------- --------------- --------------
Name: PNC Bank, National Association 79,398,305.03 13.233051% 14,677,118.56 10.871940%
Address: One PNC Plaza
3rd Floor
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Xxxxxx Guaranty Trust 33,290,743.15 5.548457% 12,948,750.54 9.591667%
Company of New York
Address: 00 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxxxxxx, Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: First Union National Bank 47,457,627.12 7.909605% 10,677,966.09 7.909605%
Address: 000 Xxxxx Xxxxxxxxx Xx.
15th Floor
Mail Code VA7406
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-1-
Amount of
Commitment for Revolving Amount of
Revolving Credit Ratable Commitment for Term Loan
Bank Credit Loans Share Term Loans Ratable Share
---- --------------- -------------- --------------- --------------
Name: Bank of America, N.A. 50,847,457.63 8.474576% 11,440,677.96 8.474576%
(formerly NationsBank, N.A.)
Address: 000 Xxxx Xxxxxx
00xx xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxx, Managing
Director
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Bank of Montreal 30,508,474.58 5.000000% 6,864,406.79 5.084746%
Address: 000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxxxx, Director
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: The Bank of New York 30,508,474.58 5.084746% 6,864,406.79 5.084746%
Address: The Energy Industries Division
Xxx Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: The Bank of Nova Scotia 30,508,474.58 5.000000% 6,864,406.79 5.084746%
Address: 000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-2-
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- -------------- --------------- --------------- --------------
Name: The Bank of Tokyo-Mitsubishi, 14,039,548.03 2.339925% 2,033,898.30 1.506591%
Ltd., Chicago Branch
Address: 000 Xxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Barclays Bank PLC 30,508,474.58 5.084746% 6,864,406.79 5.084746%
Address: 000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx X. Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: The Chase Manhattan Bank 30,508,474.58 5.084746% 6,864,406.79 5.084746%
Address: 000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: ABN AMRO Bank, N.V. 20,338,983.05 3.389831% 4,576,271.19 3.389831%
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-3-
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- -------------- -------------- -------------- -------------
Name: Credit Lyonnais New York Branch 20,338,983.05 3.389831% 4,576,271.19 3.389831%
Address: 000 Xxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Dresdner Bank A.G. New York 20,338,983.05 3.389831% 4,576,271.19 3.389831%
and Grand Cayman Branches
Address: 00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Bank One, NA (formerly known 30,508,474.58 5.084746% 6,864,406.79 5.084746%
as The First National Bank of
Chicago)
Address: 1 Bank One Plaza
Mail Code IL1-0363
Xxxxxxx, XX 00000
Attention: Xxxx Xx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Bank Hapoalim B.M. 10,169,491.53 1.694915% 2,288,135.60 1.694915%
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-4-
Amount of
Commitment for Revolving Amount of
Revolving Credit Ratable Commitment for Term Loan
Bank Credit Loans Share Term Loans Ratable Share
---- -------------- -------------- --------------- --------------
Name: The Industrial Bank of Japan, 10,169,491.53 1.694915% 2,288,135.60 1.694915%
Limited
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Mercantile Bank National 10,169,491.53 1.694915% 2,288,135.60 1.694915%
Association
Address: #0 Xxxxxxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: The Dai-Ichi Kangyo Bank, Ltd. 10,000,000.00 1.666667% 2,250,000.00 1.666667%
Address: 00 X. Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, Vice
President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: CIBC, Inc. 10,169,491.53 1.694915% 2,288,135.60 1.694915%
Address: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-5-
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- -------------- ------------- -------------- --------------
Name: Fleet National Bank 8,333,333.33 1.388889% 1,875,000.00 1.388889%
Address: 000 Xxxxxxx Xxxxxx
Mail Stop 01-08-04
Xxxxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxxxxxx, Director
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Bank Polska Kasa Opieki S.A., 3,333,333.33 0.555556% 750,000.00 0.555556%
New York Branch (formerly
Bank Polska Kasa Opieki S.A.
Pekao S.A. Group, New York
Branch)
Address: 000 Xxxx Xxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Hussein B. El-Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Banque Nationale de Paris 8,135,593.22 1.355932% 1,830,508.47 1.355932%
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Jo Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Arab Bank Plc 5,000,000.00 0.833333% 2,250,000.00 1.666667%
Address: 000 Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-6-
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- -------------- --------------- --------------- --------------
Name: Bank Leumi USA 3,389,830.51 0.564972% 762,711.87 0.564972%
Address: 000 Xxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Credit Industriel et Commercial 7,692,307.70 1.282051% 1,730,769.23 1.282051%
(formerly Compagnie Financiere
de Cic et de L'Union Europeene)
Address: 000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X'Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: National Bank of Kuwait, SAK 2,500,00.00 0.416667% 3,750,000.00 2.777778%
Address: 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: Gulf International Bank 6,666,666.67 1.111111% 1,666,666.67 1.234568%
Address: 000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-7-
Amount of
Commitment for Revolving Amount of
Revolving Credit Commitment for Term Loan
Bank Credit Loans Ratable Share Term Loans Ratable Share
---- -------------- --------------- --------------- --------------
Name: KeyBank National Bank 25,000,000.00 4.166667% -0- -0-
Address: 000 Xxxxxx Xxxxxx
XX-00-00-0000
Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Name: General Electric Capital 10,169,491.53 1.694915% 2,288,135.60 1.694915%
Corporation
Address: 00 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
TOTAL $ 600,000,000 100% $ 135,000,000 100%
===== ============== ==== ============== ====
-8-
Part 2 - Addresses for Notices to Administrative Agent and to Borrower:
----------------------------------------------------------------------
ADMINISTRATIVE AGENT
Name: PNC Bank, National Association
Address: One PNC Plaza
3rd Floor
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Vice President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
BORROWER:
Name: Arch Coal, Inc.
Address: CityPlace Xxx
XxxxXxxxx Xxxxx
Xx. Xxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-9-
SCHEDULE 5.1.6
LITIGATION
Without regard to whether a Material Adverse Change has occurred, Borrower
hereby discloses the information in its Form 10-K for the period ending December
31, 1998 and Form 10-Q's for the periods ending March 31, 1999, June 30, 1999
and September 30, 1999 with respect to its Dal-Tex property.
SCHEDULE 5.1.7
CERTAIN DISCLOSURES REGARDING
FINANCIAL STATEMENTS
Without regard to whether a Material Adverse Change has occurred, Borrower
hereby discloses (i) the information in its Form 10-K for the period ending
December 31, 1998 and Form 10-Q's for the periods ending March 31, 1999, June
30, 1999 and September 30, 1999 with respect to its Dal-Tex property and (ii)
the one-time charges to Borrower's financial statements for the period ending
December 31, 1999 due to the restructuring of its administrative work force and
to the write-down of assets at its Dal-Tex and Hobet 21 operations and certain
coal reserves in central Appalachia.
SCHEDULE 5.1.18
CERTAIN DISCLOSURES REGARDING
ENVIRONMENTAL MATTERS
Without regard to whether a Material Adverse Change has occurred, Borrower
hereby discloses the information in its Form 10-K for the period ending December
31, 1998 and Form 10-Q's for the periods ending March 31, 1999, June 30, 1999
and September 30, 1999 with respect to its Dal-Tex property.
SCHEDULE 5.1.23
PATENTS, TRADEMARKS,
COPYRIGHTS, LICENSES, ETC.
None
SCHEDULE 5.1.26
PARTNERSHIP AGREEMENTS; LLC AGREEMENTS
Limited Liability Company Agreement of Arch Western Resources, LLC, a Delaware
Limited Liability Company, dated as of June 1, 1998
Limited Liability Company Agreement of Arch of Wyoming, LLC, a Delaware Limited
Liability Company, dated as of April 15, 1998
Limited Liability Company Agreement of Arch Uinta, LLC, a Delaware Limited
Liability Company, dated as of April 29, 1998
Limited Liability Company Agreement of AU Sub, LLC, a Delaware Limited Liability
Company, dated as of April 8, 1998
Third Amended and Restated Limited Liability Company Agreement of Canyon Fuel
Company, LLC, a Delaware Limited Liability Company, dated as of June 1, 1998
Limited Liability Company Agreement of Mountain Coal Company, L.L.C., a Delaware
Limited Liability Company, dated as of March 6, 1998
Limited Liability Company Agreement of State Leases LLC, a Delaware Limited
Liability Company, dated as of April 8, 1998
Limited Liability Company Agreement of Thunder Basin Coal Company, L.L.C., a
Delaware Limited Liability Company, dated as of July 10, 1997, as amended
SCHEDULE 7.1.12
OWNED AND LEASED REAL PROPERTY;
CERTAIN EQUITY INTERESTS OF SUBSIDIARIES TO BE PLEDGED
Owned Real Property. Borrower's fee interest in the coal reserves with
respect to the following properties:
RP-9729 at Hobet Mine/Allegheny Land (West Ridge/Xxxxxx Xxxxxx)
RP-9238 at Hobet Mine (Borrower has an undivided partial interest in the
coal reserves with respect to this property.)
RP-9117 (Borrower has an undivided partial interest in the coal reserves
with respect to this property.)
RP-9123
RP-9124
RP-9154 (Borrower has an undivided partial interest in the coal reserves
with respect to this property.)
H21-004213-3
RP-9729
Leasehold Property: Thundercloud Tract
Subsidiaries:
Ark Land Company
Arch Western Acquisition Corp.
Mountaineer Land Company
Mountain Mining, Inc.
Xxxxxx Xxxxxx, Inc.
Hobet Mining, Inc.
Mountain Gem Land, Inc.
Allegheny Land Company
Catenary Coal Holdings, Inc.
Xxxxx Xxxxx Coal Company
Arch Coal Sales Company, Inc.
EXHIBIT 7.3.3
form of
QUARTERLY COMPLIANCE CERTIFICATE
____________________,_____
PNC Bank, National Association, as Administrative Agent
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Ladies and Gentlemen:
I refer to the Credit Agreement dated as of _______________, 1998 (as
amended, restated, modified or supplemented from time to time, the "Credit
Agreement") between Arch Coal, Inc. (the "Borrower"), the Lenders party thereto,
Xxxxxx Guaranty Trust Company of New York as syndication agent, First Union
National Bank as documentation agent and PNC Bank, National Association, as
administrative agent (the "Administrative Agent"). Unless otherwise defined
herein, terms defined in the Credit Agreement are used herein with the same
meanings.
I, ______________________, [Chief Executive Officer/President/Chief
Financial Officer] of the Borrower, do hereby certify in my capacity as [Chief
Executive Officer/President/Chief Financial Officer] as of the [quarter/year
ended ______________, ____] (the "Report Date"), as follows (each calculation
determined in accordance with GAAP):
(1) Off Balance-Sheet Financing/1/. The aggregate amount of off-balance sheet
transactions (i.e., the liabilities in respect of which do not appear on
the liability side of the balance sheet) for the Borrower and its
Subsidiaries, providing the functional equivalent of borrowed money
(including asset securitizations [other than accounts receivable or
inventory securitizations], sale/leasebacks or Synthetic Leases) is
$____________, which amount does not exceed the amount shown in item (iv)
below, each determined as of the Report Date.
(i) total consolidated assets of Borrower and its Subsidiaries $__________
(ii) sum of the total assets of each Special Subsidiary,
each multiplied by the Appropriate Percentage /2/ $__________
(iii) sum of (i) and (ii), without duplication $__________
(iv) 5% of item (iii) $__________
-----------------
/1/ See Section 7.2.9 of the Credit Agreement.
/2/ For each Special Subsidiary, attach a detailed schedule showing the
applicable Appropriate Percentage and calculation of "total assets" for each.
PNC Bank, National Association Report for the
Page 2 Fiscal Quarter Ending_______
(2) Maximum Leverage Ratio/3/. The ratio of (A) Debt to (B) EBITDDA is ________
to 1.00, determined as of the end of each fiscal quarter of the Borrower
for the four fiscal quarters then ended, which ratio does not exceed the
permitted ratio for the period as set forth in Section 7.2.10 of the Credit
Agreement, Debt and EBITDDA being determined as in (A) and (B) below.
(A) Debt of the Borrower and its Subsidiaries/4/, computed as follows:
(i) all indebtedness for borrowed money (including without
limitation all subordinated indebtedness but excluding
obligations under any interest rate swap, cap, collar or floor
agreement or other interest rate management device)
$_____________________________________________________________
(ii) all amounts raised under or liabilities in respect of any note
purchase or acceptance credit facility
$_____________________________________________________________
(iii) all indebtedness in respect of any other transaction (including
production payments [excluding royalties], installment
purchase agreements, forward sale or purchase agreements,
capitalized leases and conditional sale agreements) having the
commercial effect of a borrowing of money entered into by the
Borrower or any of its Subsidiaries to finance its operations or
capital requirements
$_____________________________________________________________
(iv) reimbursement obligations (contingent or otherwise) under any
letter of credit EXCLUDING (a) contingent reimbursement
obligations aggregating at any time up to $10,000,000 and (b)
contingent reimbursement obligations in respect of the Letter of
Credit issued to support the Port Bond
$_____________________________________________________________
(v) all indebtedness (whether matured or unmatured, liquidated or
unliquidated, direct or indirect, absolute or contingent or
joint or several) in respect of all Guarantees by the Borrower
--------------
/3/ See Section 7.2.10 and the definition of "Leverage Ratio" in Section 1.1 of
the Credit Agreement.
/4/ See definition of "Debt" in Section 1.1 of the Credit Agreement and attach a
schedule for each Special Subsidiary showing the applicable Appropriate
Percentage and calculation of Debt for each.
PNC Bank, National Association Report for the
Page 3 Fiscal Quarter Ending_______
and its Subsidiaries of Debt of other Persons EXCLUDING
indebtedness in respect of the Guaranty by the Borrower of the
Port Bond
$_____________________________________________________________
(vi) adjustment for the difference between actual funded indebtedness
and the fair market value of funded indebtedness recorded as
required by Accounting Principles Board Opinion No. 16 as in
effect on the Closing Date
$_____________________________________________________________
(vii) sum of items (i) through (v) as adjusted by item (vi) equals
Debt $__________
(B) EBITDDA of Borrower and its Subsidiaries/5/ for the four fiscal
quarters ending as of the Report Date, computed as follows:
(i) income from operations before the effect of changes in
accounting principles, nonrecurring charges, and extraordinary
items
$_____________________________________________________________
(ii) net interest expense $__________
(iii) income taxes $__________
(iv) depreciation $__________
(v) depletion $__________
(vi) amortization $__________
(vii) sum of items (i) through (vi) equals EBITDDA $__________
--------------
/5/ See definition of "EBITDDA" in Section 1.1 of the Credit Agreement for
assumptions regarding (1) calculation of EBITDDA of the Special Subsidiaries and
(2) calculation of EBITDDA for the fiscal quarters ending March 31, 1998, June
30, 1998, and September 30, 1998, attaching a detailed schedule showing the
calculation of EBITDDA for Arch Western Resources, LLC and its Subsidiaries for
each of those three fiscal quarters. To each Compliance Certificate submitted,
attach a schedule showing the applicable Appropriate Percentage and calculation
of EBITDDA for each Special Subsidiary.
PNC Bank, National Association Report for the
Page 4 Fiscal Quarter Ending_______
(3) Minimum Fixed Charge Coverage Ratio/6/. The ratio of (A) fixed charges to
(B) consolidated net interest expense of the Borrower and its Subsidiaries,
in each case determined on a consolidated basis as of the last day of each
fiscal quarter for the four fiscal quarters of the Borrower then ended, is
_____ to 1.00, which is not less than the minimum required ratio for the
period, as set forth in Section 7.2.11 of the Credit Agreement, fixed
charges and interest expense being calculated as in (A) and (B) below.
(A) Fixed charges are computed as follows:
(i) operating lease expense of the Borrower and its
Subsidiaries/7/ $________
(ii) EBITDDA of Borrower and its Subsidiaries (from item
(2)(B)(vii) above) $________
(iii) item (i) plus (ii) without duplication equals fixed
charges $________
(B) Interest expense of the Borrower and its Subsidiaries for the four
fiscal quarters ending as of the Report Date is computed as follows:
(i) operating lease expense (from item (3)(A)(i) above) $________
(ii) interest expense of Borrower and its Subsidiaries/8/ $________
(iii) Permitted Loan Origination Expense
$_____________________________________________________
(iv) sum of items (i) and (ii) less item (iii) equals interest
expense
$_____________________________________________________
-------------
/6/ See Section 7.2.11 of the Credit Agreement.
/7/ See definition of "Fixed Charge Coverage Ratio" in Section 1.1 of the Credit
Agreement for assumptions regarding (1) calculation of "operating lease expense"
of the Special Subsidiaries and (2) calculation of operating lease expense for
the fiscal quarters ending June 30, 1998, September 30, 1998, and December 31,
1998, attaching a detailed schedule hereto showing the calculation of operating
lease expense for Arch Western Resources, LLC and its Subsidiaries for each of
those three fiscal quarters. To each Compliance Certificate submitted, attach a
schedule showing the applicable Appropriate Percentage and calculation of
operating lease expense for each Special Subsidiary.
/8/ See definition of "Fixed Charge Coverage Ratio" in Section 1.1 of the Credit
Agreement for assumptions regarding (1) calculation of "interest expense" of the
Special Subsidiaries and (2) calculation of interest expense for the fiscal
quarters ending June 30, 1998, September 30, 1998, and December 31, 1998,
attaching a detailed schedule hereto showing the calculation of interest expense
for Arch Western Resources, LLC and its Subsidiaries for each of those three
fiscal quarters. To each Compliance Certificate submitted, attach a schedule
showing the applicable Appropriate Percentage and calculation of interest
expense for each Special Subsidiary.
PNC Bank, National Association Report for the
Page 5 Fiscal Quarter Ending_______
(4) Minimum Net Worth/9/. The Borrower's Consolidated Tangible Net Worth as of
the Report Date is $___________, which is not less than the Borrower's Base
Net Worth of $_______________, as calculated in (A) and (B) below.
(A) Consolidated Tangible Net Worth of the Borrower and its Subsidiaries
as of the Report Date, computed as follows:
(i) total stockholders' equity
$_____________________________________________________________
(ii) intangible assets of the Borrower and its Subsidiaries
$_____________________________________________________________
(iii) the amount of the Investment by the Borrower and its
Subsidiaries in Permitted Joint Ventures in excess of
$30,000,000, adjusted to exclude the after-tax effect of any
changes in accounting principles subsequent March 31, 1998
$_____________________________________________________________
(iv) item (i) less items (ii) and (iii) equals Consolidated Tangible
Net Worth
$_____________________________________________________________
(B) Base Net Worth, computed as follows:
(i) [fixed amount]
$_____________________________________________________________
(ii) 50% of consolidated net income of the Borrower and its
Subsidiaries (before the after-tax effects of changes in
accounting principles) for each fiscal quarter in which net
income was earned (but not to be less than $0 if the Borrower
and its Subsidiaries experienced a consolidated net loss during
any fiscal quarter)
$_____________________________________________________________
-------------------
/9/ See Section 7.2.12 of the Credit Agreement.
PNC Bank, National Association Report for the
Page 6 Fiscal Quarter Ending_______
(iii) 80% of net increase in Consolidated Tangible Net Worth resulting
from the issuance of equity securities by the Borrower for the
period from January 1, 2000, through the Report Date
$_____________________________________________________________
(iv) sum of items (i) through (iii) equals Base Net Worth
$_____________________________________________________________
(5) Liens/10/. The consolidated aggregate amount of all payments in respect to
all Indebtedness of the Arch Coal Group secured by Permitted Liens as of
the Report Date is $__________, which amount is not greater than item (iv)
below, each determined as of the Report Date.
(i) total assets of Arch Coal Group $________
(ii) Investment of Arch Coal Group in Arch Western Group $________
(iii) item (i) less item (ii) $________
(iv) 5% of item (iii) $________
(6) Investments in Permitted Joint Ventures. As of the date hereof, the
aggregate of all permitted Investments in Permitted Joint Ventures of the
Borrower and its Subsidiaries (each such Investment being listed on the
attached schedule, showing the name and nature of the Joint Venture, amount
of the Investment, the Person making such Investment, and the other
Person(s) party to the Joint Venture), totals $______________, which amount
does not exceed, for the Borrower and all Significant Subsidiaries, the
amount set forth in Section 7.2.6 of the Credit Agreement.
(7) Permitted Investments in Arch Western. The Borrower's Permitted Investment
in Arch Western totals as of the Report Date totals $____________________,
which amount does not exceed the limit on such Investments set forth in
Section 7.2.14(v) of the Credit Agreement.
(8) As of the date hereof, the Borrower has performed and complied with all
covenants and conditions of the Credit Agreement; all of the
representations and warranties contained in Section 5 of the Credit
Agreement and in the other Loan Documents are true on and as of the date
hereof with the same effect as though such representations and warranties
had been made on the date hereof (except representations and warranties
which expressly relate solely
-----------------
/10/ See Section 7.2.2 of the Credit Agreement.
PNC Bank, National Association Report for the
Page 7 Fiscal Quarter Ending_______
to an earlier date or time, which representations and warranties shall be
true and correct on and as of the specific dates or times referred to
therein); no Event of Default or Potential Default exists and is
continuing.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
_____ day of ____________, _____.
ARCH COAL, INC.
By:
---------------------------------------
Name:
Title: [Chief Executive Officer/
President/Chief Financial Officer]
