EXECUTION COPY
EXHIBIT 10.1
CREDIT AGREEMENT
BY AND AMONG
NRP (OPERATING) LLC, AS BORROWER,
THE LENDERS PARTY HERETO,
PNC BANK, NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT,
BRANCH BANKING AND TRUST COMPANY, AS SYNDICATION AGENT, AND
BANK OF MONTREAL
AND
BNP PARIBAS,
AS DOCUMENTATION AGENTS,
DATED AS OF OCTOBER 17, 2002
PNC CAPITAL MARKETS, INC., AS LEAD ARRANGER
TABLE OF CONTENTS
Page
----
1. DEFINITIONS......................................................................................... 1
1.1 DEFINED TERMS................................................................................ 1
1.2 ACCOUNTING PRINCIPLES........................................................................ 16
1.3 OTHER DEFINITIONAL CONVENTIONS AND RULES OF CONSTRUCTION..................................... 16
2. THE REVOLVING CREDIT LOANS.......................................................................... 17
2.1 REVOLVING CREDIT LOANS....................................................................... 17
2.1a REVOLVING CREDIT FACILITY.................................................................... 17
2.1b REVOLVING CREDIT COMMITMENT OF EACH LENDER................................................... 17
2.1c REVOLVING CREDIT NOTES....................................................................... 17
2.1d REVOLVING CREDIT LOAN REQUEST................................................................ 17
2.1e MAKING REVOLVING CREDIT LOANS................................................................ 18
2.2 INTEREST RATES, INTEREST PAYMENT AND CERTAIN PROVISIONS RELATING TO INTEREST AND FEES........ 18
2.2a PAYMENTS OF INTEREST......................................................................... 18
2.2b INTEREST RATE OPTIONS........................................................................ 19
2.2c INTEREST PERIODS; LIMITATIONS ON ELECTIONS................................................... 19
2.2d ELECTION, CONVERSION OR RENEWAL OF INTEREST RATE OPTIONS..................................... 20
2.2e NOTIFICATION OF ELECTION OF AN INTEREST RATE OPTION.......................................... 20
2.2f INTEREST AFTER DEFAULT....................................................................... 20
2.3 YIELD-PROTECTION, CAPITAL ADEQUACY AND MISCELLANEOUS PROVISIONS RELATING TO EURO-RATE........ 21
2.3a YIELD PROTECTION............................................................................. 21
2.3b CAPITAL ADEQUACY............................................................................. 22
2.3c EURO-RATE UNASCERTAINABLE.................................................................... 23
2.3d ILLEGALITY................................................................................... 23
2.4 FEES......................................................................................... 24
2.4a COMMITMENT FEE............................................................................... 24
2.4b AGENT'S FEE.................................................................................. 24
2.4c LETTER OF CREDIT FEE AND FRONTING FEE........................................................ 24
2.5 CALCULATION OF INTEREST AND CERTAIN FEES..................................................... 24
2.6 LETTER OF CREDIT SUB-FACILITY................................................................ 24
2.6a ISSUANCE OF LETTERS OF CREDIT................................................................ 25
2.6b LETTER OF CREDIT FEES........................................................................ 25
2.6c LETTER OF CREDIT FEES UPON DEFAULT........................................................... 25
2.6d DISBURSEMENTS, REIMBURSEMENT................................................................. 25
2.6e REPAYMENT OF PARTICIPATION ADVANCES.......................................................... 27
2.6f DOCUMENTATION................................................................................ 27
2.6g DETERMINATIONS TO HONOR DRAWING REQUESTS..................................................... 27
2.6h NATURE OF PARTICIPATION AND REIMBURSEMENT OBLIGATIONS........................................ 27
2.6i INDEMNITY.................................................................................... 29
2.6j LIABILITY FOR ACTS AND OMISSIONS............................................................. 29
2.6k UNIFORM CUSTOMS.............................................................................. 29
2.7 SUBSTITUTION OR REPLACEMENT OF A LENDER...................................................... 30
2.8 LOAN REPAYMENT AND PREPAYMENT................................................................ 30
- i -
TABLE OF CONTENTS
Page
----
2.8a VOLUNTARY PREPAYMENTS........................................................................ 30
2.8b SCHEDULED REPAYMENT.......................................................................... 31
2.9 ADDITIONAL PAYMENTS BY THE BORROWER.......................................................... 31
2.10 CHANGES OF COMMITMENTS; VOLUNTARY REDUCTION OF AVAILABILITY.................................. 31
2.11 LOAN ACCOUNT................................................................................. 32
2.12 PAYMENT FROM ACCOUNTS MAINTAINED BY BORROWER................................................. 32
2.13 TIME, PLACE AND MANNER OF PAYMENTS........................................................... 32
2.14 GUARANTY..................................................................................... 33
3. REPRESENTATIONS AND WARRANTIES...................................................................... 33
3.1 EXISTENCE.................................................................................... 33
3.2 CAPITALIZATION: OWNERSHIP.................................................................... 33
3.3 SUBSIDIARIES AND OTHER INVESTMENTS........................................................... 33
3.4 CORPORATE AUTHORITY.......................................................................... 33
3.5 ENFORCEABILITY............................................................................... 34
3.6 NO RESTRICTIONS, NO DEFAULT.................................................................. 34
3.7 FINANCIAL MATTERS............................................................................ 34
3.7a FINANCIAL STATEMENTS......................................................................... 34
3.7b PRO FORMA FINANCIALS......................................................................... 35
3.8 ABSENCE OF LITIGATION........................................................................ 35
3.9 TAX RETURNS AND PAYMENTS..................................................................... 35
3.10 PENSION PLANS................................................................................ 35
3.11 FISCAL YEAR.................................................................................. 36
3.12 CONDITION OF AND TITLE TO ASSETS............................................................. 36
3.13 INSURANCE.................................................................................... 36
3.14 LABOR AND EMPLOYMENT MATTERS................................................................. 36
3.15 COMPLIANCE WITH APPLICABLE LAWS.............................................................. 36
3.16 ENVIRONMENTAL MATTERS........................................................................ 36
3.17 CONSENTS AND APPROVALS....................................................................... 37
3.18 REGULATIONS T, U AND X....................................................................... 37
3.19 INVESTMENT COMPANY ACT....................................................................... 37
3.20 PUBLIC UTILITY HOLDING COMPANY ACT........................................................... 37
3.21 SENIOR DEBT STATUS........................................................................... 37
3.22 INTELLECTUAL PROPERTY........................................................................ 37
3.23 LEASES....................................................................................... 37
3.24 SOLVENCY..................................................................................... 38
3.25 TAX TREATMENT................................................................................ 38
3.26 DISCLOSURE................................................................................... 38
3.27 TRANSACTIONS WITH AFFILIATES................................................................. 38
4. AFFIRMATIVE COVENANTS............................................................................... 38
4.1 USE OF PROCEEDS.............................................................................. 38
4.2 FURNISHING INFORMATION....................................................................... 39
4.3 VISITATION................................................................................... 42
4.4 PRESERVATION OF EXISTENCE; QUALIFICATION..................................................... 42
4.5 COMPLIANCE WITH LAWS AND CONTRACTS........................................................... 42
- ii -
TABLE OF CONTENTS
Page
----
4.6 PAYMENT OF TAXES AND OTHER LIABILITIES....................................................... 42
4.7 INSURANCE.................................................................................... 42
4.8 MAINTENANCE OF PROPERTIES.................................................................... 43
4.9 PLANS AND BENEFIT ARRANGEMENT................................................................ 43
4.10 SENIOR DEBT STATUS........................................................................... 43
4.11 LEASES; MATERIAL CONTRACTS................................................................... 43
4.12 CLEAN-DOWN PERIOD............................................................................ 43
4.13 ENVIRONMENTAL INDEMNIFICATION................................................................ 44
5. NEGATIVE COVENANTS.................................................................................. 44
5.1 DIVIDENDS, ETC............................................................................... 44
5.2 ENCUMBRANCES................................................................................. 44
5.3 FINANCIAL COVENANTS.......................................................................... 45
5.3a LEVERAGE RATIO............................................................................... 45
5.3b INTEREST COVERAGE RATIO...................................................................... 45
5.3c CALCULATION OF CONSOLIDATED EBITDDA.......................................................... 45
5.4 ACQUISITIONS................................................................................. 45
5.5 INDEBTEDNESS................................................................................. 46
5.6 LOANS, ACQUISITIONS AND INVESTMENTS.......................................................... 46
5.7 SALES OF ASSETS.............................................................................. 47
5.8 MERGER....................................................................................... 47
5.9 REGULATION T, U AND X COMPLIANCE............................................................. 47
5.10 ERISA........................................................................................ 47
5.11 NO LIMITATION ON DIVIDENDS AND DISTRIBUTIONS................................................. 48
5.12 NEGATIVE PLEDGES............................................................................. 48
5.13 CHANGES IN ORGANIZATIONAL DOCUMENTS.......................................................... 48
5.14 CHANGE IN NATURE OF BUSINESS................................................................. 48
5.15 CHANGES IN OMNIBUS AGREEMENT................................................................. 48
5.16 TRANSACTIONS WITH AFFILIATES................................................................. 49
6. CONDITIONS PRECEDENT TO DISBURSEMENTS AND ISSUANCE OF LETTERS OF CREDIT............................. 49
6.1 ALL DISBURSEMENTS............................................................................ 49
6.1a NO DEFAULT................................................................................... 49
6.1b REPRESENTATIONS CORRECT...................................................................... 49
6.1c NO MATERIAL ADVERSE CHANGE................................................................... 49
6.1d LOAN REQUEST/APPLICATION..................................................................... 49
6.1d LOAN REQUEST/APPLICATION..................................................................... 49
6.2 CONDITIONS PRECEDENT TO INITIAL BORROWINGS................................................... 49
7. DEFAULTS............................................................................................ 52
7.1 PAYMENT DEFAULT.............................................................................. 52
7.2 NONPAYMENT OF OTHER INDEBTEDNESS............................................................. 52
7.3 INSOLVENCY................................................................................... 52
7.3a INVOLUNTARY PROCEEDINGS...................................................................... 52
7.3b VOLUNTARY PROCEEDINGS........................................................................ 52
- iii -
TABLE OF CONTENTS
Page
----
7.4 TERMINATION OF EXISTENCE..................................................................... 52
7.5 FAILURE TO COMPLY WITH LOAN DOCUMENTS........................................................ 53
7.5a FAILURE TO COMPLY WITH ARTICLE V COVENANTS AND CERTAIN ARTICLE IV COVENANTS.................. 53
7.5b FAILURE TO COMPLY WITH OTHER COVENANTS AND LOAN DOCUMENTS.................................... 53
7.6 MISREPRESENTATION............................................................................ 53
7.7 ADVERSE JUDGMENTS, ETC....................................................................... 53
7.8 INVALIDITY OR UNENFORCEABILITY............................................................... 53
7.9 ERISA........................................................................................ 53
7.10 CHANGE IN CONTROL............................................................................ 53
7.11 CONSEQUENCES OF AN EVENT OF DEFAULT.......................................................... 54
7.12 REMEDIES UPON DEFAULT........................................................................ 54
7.13 CASH COLLATERAL.............................................................................. 54
8. AGREEMENT AMONG LENDERS............................................................................. 55
8.1 APPOINTMENT AND GRANT OF AUTHORITY........................................................... 55
8.2 DELEGATION OF DUTIES......................................................................... 55
8.3 RELIANCE BY AGENT ON LENDERS FOR FUNDING..................................................... 55
8.4 NON-RELIANCE ON AGENT........................................................................ 56
8.5 RESPONSIBILITY OF AGENT AND OTHER MATTERS.................................................... 56
8.5a MINISTERIAL NATURE OF DUTIES................................................................. 56
8.5b LIMITATION OF LIABILITY...................................................................... 56
8.5c RELIANCE..................................................................................... 57
8.6 ACTIONS IN DISCRETION OF AGENT: INSTRUCTIONS FROM THE LENDERS................................ 57
8.7 INDEMNIFICATION.............................................................................. 57
8.8 AGENT'S RIGHTS AS A LENDER................................................................... 58
8.9 PAYMENT TO LENDERS........................................................................... 58
8.10 PRO RATA SHARING............................................................................. 58
8.11 SUCCESSOR AGENT.............................................................................. 58
8.11a RESIGNATION OF AGENT......................................................................... 58
8.11b RIGHTS OF THE FORMER AGENT................................................................... 59
8.12 NOTICE OF DEFAULT............................................................................ 59
8.13 NOTICES...................................................................................... 59
8.14 HOLDERS OF REVOLVING CREDIT NOTES............................................................ 59
8.15 CALCULATIONS................................................................................. 59
8.16 BENEFICIARIES................................................................................ 59
9. GENERAL PROVISIONS.................................................................................. 60
9.1 AMENDMENTS AND WAIVERS....................................................................... 60
9.2 EXPENSES..................................................................................... 61
9.3 NOTICES...................................................................................... 61
9.3a NOTICE TO THE BORROWER....................................................................... 62
9.3b NOTICE TO THE AGENT.......................................................................... 62
9.3c NOTICE TO THE LENDERS........................................................................ 63
9.4 TAX WITHHOLDING.............................................................................. 63
9.5 SUCCESSORS AND ASSIGNS....................................................................... 64
- iv -
TABLE OF CONTENTS
Page
----
9.6 ASSIGNMENTS AND PARTICIPATIONS............................................................... 64
9.6a ASSIGNMENTS.................................................................................. 64
9.6b ASSIGNMENT REGISTER.......................................................................... 66
9.6c PARTICIPATIONS............................................................................... 66
9.6d PROVISIONS FOR SPECIAL PURPOSE FUNDING VEHICLES.............................................. 66
9.7 SEVERABILITY................................................................................. 67
9.8 SURVIVAL..................................................................................... 67
9.9 GOVERNING LAW................................................................................ 67
9.10 NON-BUSINESS DAYS............................................................................ 67
9.11 INTEGRATION.................................................................................. 67
9.12 HEADINGS, ETC................................................................................ 68
9.13 SET-OFF...................................................................................... 68
9.14 CONSENT TO FORUM............................................................................. 68
9.15 WAIVER OF JURY TRIAL......................................................................... 68
9.16 INDEMNITY.................................................................................... 68
9.17 COUNTERPARTS................................................................................. 69
9.18 LIMITATION ON RECOURSE TO GENERAL PARTNER.................................................... 69
9.19 CONFIDENTIALITY.............................................................................. 69
Exhibit A - Form of Revolving Credit Notes
Exhibit B - Form of Revolving Credit Loan Request
Exhibit C - Form of Compliance Certificate
Exhibit D-1 - Form of Guaranty Agreement (Parent)
Exhibit D-2 - Form of Guaranty Agreement (Subsidiary)
Exhibit E - Form of Opinion of Special Counsel to the Borrower
Exhibit F - Form of Assignment and Assumption Agreement
Exhibit G - Form of Pro Forma Compliance Certificate
- v -
CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 17, 2002, by and among NRP
(OPERATING) LLC, a Delaware limited liability company (as further defined below,
the "Borrower"), the financial institutions listed on the signature pages
hereto, and each other financial institution which, from time to time, becomes a
party hereto in accordance with Subsection 9.6a (individually, a "Lender" and
collectively, the "Lenders") and PNC BANK, NATIONAL ASSOCIATION, a national
banking association, as Administrative Agent for the Lenders (in such capacity,
and as further defined below, the "Agent"), BANK OF MONTREAL and BNP PARIBAS, as
Documentation Agents for the Lenders, and BRANCH BANKING AND TRUST COMPANY, as
Syndication Agent for the Lenders.
WITNESSETH:
WHEREAS, the Borrower desires to obtain a Revolving Credit Commitment (as
defined below) from each of the Lenders pursuant to which Revolving Credit
Loans, in a maximum aggregate principal amount at any one time outstanding not
to exceed $100,000,000, will be made to the Borrower from time to time prior to
the Termination Date (as defined below); and
WHEREAS, each Lender is willing, on the terms and subject to the
conditions hereinafter set forth, to extend such Revolving Credit Commitment and
make such Revolving Credit Loans to the Borrower.
NOW, THEREFORE, in consideration of mutual promises contained herein and
other valuable consideration and with the intent to be legally bound hereby, the
parties hereto agree as follows:
1. DEFINITIONS.
1.1 DEFINED TERMS. As used herein the following terms shall have the meaning
specified unless the context otherwise requires:
"Adjusted Euro-Rate" has the meaning set forth in item (ii) of Subsection
2.2b.
"Affiliate" as to any Person shall mean any other Person (i) which
directly or indirectly controls, is controlled by, or is under common control
with such Person, (ii) which beneficially owns or holds 10% or more of any class
of the voting or other equity interests of such Person, or (iii) 10% or more of
any class of voting interests or other equity interests of which is beneficially
owned or held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, including
the power to elect a majority of the directors or trustees of a corporation or
trust, as the case may be.
"Agent" means PNC Bank, National Association in its capacity as
Administrative Agent or its successor appointed pursuant to Section 8.11 hereof
and as the issuer of Letters of Credit.
"Agent's Fees" means those certain fees for the sole account of the Agent
set forth in the Agent's Letter.
"Agent's Letter" has the meaning set forth in Subsection 2.4b.
"Agreement" means this Credit Agreement, together with the exhibits and
schedules hereto and all extensions, renewals, amendments, modifications,
substitutions and replacements hereto and hereof.
"Applicable Euro-Rate Margin" means for each Euro-Rate Portion of all
Revolving Credit Loans, the percentage expressed in basis points per annum
determined from time to time based upon the ratio of the Parent's Consolidated
Total Indebtedness as at the end of each Fiscal Quarter to the Parent's
Consolidated EBITDDA for the four most recently completed Fiscal Quarters
treated as a single accounting period set forth under the relevant column
heading below, all as determined by the Parent's financial statements and
Compliance Certificate for the preceding Fiscal Quarter or Fiscal Year delivered
to the Agent pursuant to Section 4.2 below:
RATIO OF CONSOLIDATED TOTAL
INDEBTEDNESS TO CONSOLIDATED
EBITDDA APPLICABLE EURO-RATE MARGIN
---------------------------- ---------------------------
LEVEL I
Less than or equal to 1.25 to 1.00 125 Basis Points
LEVEL II
Greater than 1.25 to 1.00 but less than or equal 150 Basis Points
to 1.75 to 1.00
LEVEL III
Greater than 1.75 to 1.00 175 Basis Points
Adjustments to the Applicable Euro-Rate Margin resulting from changes in the
ratio of the Parent's Consolidated Total Indebtedness to Consolidated EBITDDA
shall be made without notice to the Borrower. Such adjustments will be effective
on the date on which the Parent's financial statements and Compliance
Certificate are due to be delivered to the Lenders pursuant to Section 4.2;
provided, however, that if the Borrower has failed to deliver, or caused to be
delivered, such financial statements and Compliance Certificate on or before the
date such delivery is due, then the ratio of the Parent's Consolidated Total
Indebtedness to Consolidated EBITDDA shall be deemed, solely for the purposes of
this definition, to be greater than 1.75 to 1.00 until such time as they are
actually delivered.
"Arch Coal" means Arch Coal, Inc., a Delaware corporation.
"Ark Land " means Ark Land Company, a Delaware corporation.
"Assignment and Assumption Agreement" means an Assignment and Assumption
Agreement in the form of Exhibit "F" hereto.
- 2 -
"Authorized Officer" means the President, any Vice President, the Chief
Financial Officer, the Treasurer or the principal accounting officer of the
respective Loan Party or general partner if such Loan Party is a partnership or
managing member if such Loan Party is a limited liability company. The Agent and
the Lenders shall be entitled to rely on the incumbency certificates delivered
pursuant to Section 6.2 for the initial designation of each Authorized Officer.
Additions or deletions to the list of Authorized Officers may be made by the
respective Loan Party at any time by delivering to the Agent for redelivery to
each Lender a revised incumbency certificate.
"Available Cash" has the meaning set forth in Section 1.1 of the MLP
Agreement as in effect on the Closing Date with the following clarifications:
(i) in clause (a)(ii) the words "Working Capital Borrowings" are intended to
refer to "any Distribution Loan," and (ii) cash reserves necessary to comply
with clause (b)(ii) are intended to include without limitation any General
Revolving Loan then outstanding.
"Bank Indebtedness" means (i) the Revolving Credit Loans then outstanding,
together with all increases or refinancings thereof, (ii) the aggregate stated
amount of Letters of Credit outstanding hereunder, (iii) the aggregate amount of
unreimbursed draws on Letters of Credit issued hereunder, (iv) all interest,
fees and any other amounts due hereunder or under any of the other Loan
Documents, including by reason of advances by the Lenders, made to, or for the
account of, the Borrower pursuant to this Agreement or any other Loan Document,
and (v) all reasonable out-of-pocket expenses incurred by the Lenders and the
Agent (including but not limited to fees and expenses of counsel).
"Base Rate" means, for any day, the higher of (i) the sum of (A) the
Federal Funds Effective Rate for such day plus (B) fifty (50) basis points
(.50%) per annum and (ii) the Prime Rate, as of such day.
"Base Rate Option" means the interest rate option described in item (i) of
Subsection 2.2b.
"Base Rate Portion" means a Revolving Credit Loan or a portion thereof
which bears, or is to bear, interest at the Base Rate.
"Borrower" means NRP (Operating) LLC, a Delaware limited liability company
and its successors and permitted assigns.
"Borrowing Date" means the date on which any Disbursements are to be made
hereunder.
"Business Day" means, any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required to be closed for
business in Pittsburgh, Pennsylvania or New York, New York and, if the
applicable Business Day relates to any Disbursement to which the Euro-Rate
Option applies, such day must also be a day on which dealings are carried on in
the London interbank market.
"Capital Adequacy Event" has the meaning given it in Subsection 2.3b.
- 3 -
"Capital Compensation Amount" has the meaning given it in Subsection 2.3b.
"Cash Collateral Account" has the meaning given it in Section 7.13.
"Change in Control" means (i) such time as the Parent ceases to own
directly all of the member interests of the Borrower, (ii) such time as the
General Partner ceases to own directly all of the general partner interests of
the Parent, or (iii) such time as Xxxxxx X. Xxxxxxxxx, Xx., the WPP Group and/or
one or more of their direct or indirect, wholly-owned Subsidiaries cease to own
more than 50% of the partnership interests of the General Partner.
"Closing" means the execution and delivery of this Agreement which
execution and delivery shall occur at the offices of Xxxxxxxx Ingersoll
Professional Corporation in Pittsburgh, Pennsylvania, at 10:00 A.M. (eastern
time) on October 17, 2002, or such other date and time as is mutually agreeable
to the parties hereto.
"Closing Date" means the day on which the Closing occurs.
"Coal" shall mean all types of marketable coal, including without
limitation, bituminous and sub-bituminous coal, and lignite.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation thereto, together with all regulations
promulgated and rulings issued thereunder.
"Commitment Fee" means the fee described in Subsection 2.4a.
"Commitment Fee Rate" means a rate per annum equal to fifty basis points
(0.50%).
"Compliance Certificate" means a Compliance Certificate substantially in
the form of Exhibit "C".
"Consolidated" means the consolidation of the accounts of any two or more
Persons in accordance with GAAP.
"Consolidated EBITDDA" means, for any period, Consolidated Net Income for
such period, (x) excluding therefrom (A) any non-cash extraordinary items of
gain or loss (including without limitation those items created by mandated
changes in accounting treatment) and (B) any gain or loss of any other Person
accounted for on the equity method, except to the extent of cash distributions
received during the relevant period (y) plus the aggregate amounts deducted in
determining Consolidated Net Income for such period in respect of (i)
Consolidated Interest Expense, (ii) income taxes, (iii) depletion expense, (iv)
depreciation expense and (iv) amortization expense. Notwithstanding the
foregoing, in the calculation of Consolidated EBITDDA for each of the Fiscal
Quarters ending September 30, 2002, December 31, 2002, March 31, 2003, June 30,
2003 and September 30, 2003, respectively, Consolidated EBITDDA shall be
determined as follows: (i) for the Fiscal Quarter ending September 30, 2002,
Consolidated EBITDDA shall be Historical EBITDDA, (ii) for the Fiscal Quarter
ending December 31, 2002, Consolidated EBITDDA shall be the Historical EBITDDA
multiplied by the
- 4 -
sum of 365 minus the number of days elapsed from the Closing Date until December
31, 2002 divided by 365, plus Consolidated EBITDDA of the Parent for the period
beginning on the Closing Date and ending December 31, 2002, (iii) for the Fiscal
Quarter ending March 31, 2003, Consolidated EBITDDA shall be the Historical
EBITDDA of the Parent multiplied by the sum of 365 minus the number of days
elapsed from the Closing Date until March 31, 2002 divided by 365, plus
Consolidated EBITDDA of the Parent for the period beginning on the Closing Date
and ending March 31, 2003, (iv) for the Fiscal Quarter ending June 30, 2003,
Consolidated EBITDDA shall be Historical EBITDDA multiplied by the sum of 365
minus the number of days elapsed from the Closing Date until June 30, 2003, plus
Consolidated EBITDDA of the Parent for the period beginning on the Closing Date
and ending June 30, 2003, and (v) for the Fiscal Quarter ending September 30
2003, Consolidated EBITDDA shall be Historical EBITDDA multiplied by the sum of
365 minus the number of days elapsed from the Closing Date until September 30,
2003, plus Consolidated EBITDDA of the Parent for the period beginning on the
Closing Date and ending September 30, 2003.
"Consolidated Interest Expense" means, for the relevant period, on a
Consolidated basis, the sum of all interest (including the interest portion of
any capitalized lease obligations) and letter of credit fees or commissions due
and payable by the Parent and its Consolidated Subsidiaries with regard to
Indebtedness for such period.
"Consolidated Net Income" means the net income (or deficit) of the Parent
and its Consolidated Subsidiaries, for the period in question, after deducting
all operating expenses, provisions for all taxes and reserves (including
reserves for all deferred income taxes, if applicable) and all other proper
deductions, all determined on a Consolidated basis.
"Consolidated Subsidiaries" shall mean the Subsidiaries of the Borrower
whose accounts are consolidated in accordance with GAAP.
"Consolidated Total Indebtedness" means the Indebtedness of the Parent and
its Consolidated Subsidiaries determined on a Consolidated basis.
"Contamination" means the uncontained presence of Hazardous Substances at
any real property of the Borrower or any Subsidiary of the Borrower, whether
owned or leased, which may require clean-up or remediation under any applicable
Environmental Law.
"Contributors" has the meaning given it in Section 3.7a.
"Disbursement" means each advance of funds by a Lender hereunder of a
Revolving Credit Loan.
"Distribution Loan" has the meaning given it in Subsection 2.1a.
"Dollars" or "$" means the legal tender of the United States of America.
"Drawing Date" has the meaning given it in Subsection 2.6d(ii).
- 5 -
"Encumbrance" means any encumbrance, mortgage, lien, charge, pledge,
security interest, priority payment, conditional sales agreement right, or other
title retention agreement right (including any right under a lease which, in
accordance with GAAP, would be treated as a capitalized item) in, upon or
against any asset of any Person.
"Environmental Claim" means any claim, suit, notice, order, demand or
other written communication made by any Person with respect to the Borrower or
any Subsidiary of the Borrower or any of their respective properties, whether
owned or leased, that: (i) asserts a violation of an applicable Environmental
Law; (ii) asserts a liability under an applicable Environmental Law; (iii)
orders investigation, corrective action, remediation or other legally
enforceable response under an applicable Environmental Law; (iv) demands
information under an applicable Environmental Law; (v) alleges personal injury
or property damage resulting from exposure to or the presence of Hazardous
Substances; or (vi) alleges that there is or may be Contamination.
"Environmental Law(s)" means any and all Governmental Rules and any and
all decrees, permits, licenses, agreements, authorizations or other governmental
restrictions of any Governmental Authority relating to the environment or the
release of any Hazardous Substances into the environment, whether now in
existence or hereafter enacted, agreed to, adopted, issued or otherwise becoming
effective.
"ERISA" means the Employee Retirement Income Security Act of 1974,
together with the regulations thereunder, as now in effect and as hereafter from
time to time amended or any successor statute.
"ERISA Affiliate" means, as of any date, the Borrower and any member of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities, which, together with
the Borrower, are treated as of such date as a single employer under Section 414
of the Code.
"Euro-Rate" means, with respect to portions of the Revolving Credit Loans
to which the Euro-Rate Option applies for any Interest Period, the interest rate
per annum determined by the Agent by dividing (the resulting quotient rounded
upwards, if necessary, to the nearest 1/100th of 1% per annum) (i) the rate of
interest determined by the Agent in accordance with its usual procedures (which
determination shall be conclusive, absent manifest error) to be the average of
the London interbank offered rates for U.S. Dollars quoted by the British
Bankers' Association as set forth on Dow Xxxxx Markets Service (formerly known
as Telerate) display page 3750 (or appropriate successor or, if British Bankers'
Association or its successor ceases to provide such quotes, a comparable
replacement determined by the Agent), two (2) Business Days prior to the first
day of such Interest Period for an amount comparable to such Revolving Credit
Loan and having a Borrowing Date and a maturity comparable to such Interest
Period by (ii) a number equal to 1.00 minus the Euro-Rate Reserve Percentage.
The Euro-Rate may also be expressed by the following formula:
- 6 -
Average of London interbank offered rates on
Dow Xxxxx Markets Service display page 3750
Euro-Rate = as quoted by BBA or appropriate successor
--------------------------------------------
1.00 - Euro-Rate Reserve Percentage
"Euro-Rate Option" means the interest rate option described in item (ii)
of Subsection 2.2b.
"Euro-Rate Portion" means a Revolving Credit Loan, or portion thereof,
which bears, or is to bear, interest at the Adjusted Euro-Rate.
"Euro-Rate Reserve Percentage" means, as of any day, the maximum effective
percentage (expressed as a decimal, rounded upward to the nearest 1/100th of
1%), as determined in good faith by the Agent (which determination shall be
conclusive), which is in effect on such day as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
reserve requirements (including, without limitation, supplemental, marginal and
emergency reserve requirements) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities").
"Event of Default" has the meaning given it in Article VII.
"Federal Funds Effective Rate" means, for any day, the rate per annum
(based on a year of 360 days and the actual days elapsed and rounded upward to
the nearest 1/100th of 1%) announced by the Federal Reserve Bank of New York (or
any successor) on such day as being the weighted average of the rates on
overnight federal funds transactions arranged by federal funds brokers on the
previous trading day, as computed and announced by Federal Reserve Bank New York
(or any successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; provided, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day for which such rate was announced.
"Fees" means collectively the Agent's Fee, the Fronting Fee, the Letter of
Credit Fee and the Commitment Fee.
"Fiscal Quarter" means the three month fiscal period of the Parent or the
Borrower, as the case may be, beginning on each October 1, January 1, April 1
and July 1 and ending on the succeeding December 31, March 31, June 30 and
September 30, respectively.
"Fiscal Year" means each fiscal period of the Parent or the Borrower, as
the case may be, beginning January 1 and ending on the next succeeding December
31.
"Form S-1" means the Parent's Form S-1 Registration Statement No.
333-86582, as amended.
"Fronting Fee" has the meaning given it in Subsection 2.6b.
- 7 -
"GAAP" means generally accepted accounting principles as are in effect
from time to time in the United States of America, subject to the provision of
Section 1.2, which shall include, but not be limited to, the official
interpretations thereof as defined by the Financial Accounting Standards Board,
its predecessors and its successors, and applied on a consistent basis both as
to classification of items and amounts.
"General Partner" means NRP (GP) LP, a Delaware limited partnership and
the sole general partner of the Parent.
"General Revolving Loan" " has the meaning given it in Subsection 2.1a.
"Governmental Acts" has the meaning given it in Subsection 2.6i.
"Governmental Authority" means the government of the United States or the
government of any state or locality therein, any political subdivision or any
governmental, quasi-governmental, judicial, public or statutory instrumentality,
authority, body or entity, or other regulatory bureau, authority, body or entity
of the United States or any state or locality therein, including the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the Currency and
the Board of Governors of the Federal Reserve System, and any central bank of
any other country or any comparable authority.
"Governmental Rule" means any law, statute, rule, regulation, ordinance,
order, judgment, guideline or decision of any Governmental Authority.
"Granting Lender" has the meaning given it in Subsection 9.6d.
"Guarantor" means the Parent and each Subsidiary of the Parent (other than
the Borrower) in existence on the Closing Date and each Person which becomes a
Subsidiary of the Parent after the Closing Date.
"Guaranty" or "Guarantee" means any obligation, direct or indirect, by
which a Person undertakes to guaranty, assume or remain liable for the payment
or performance of another Person's obligations, including but not limited to (i)
endorsements of negotiable instruments, (ii) discounts with recourse, (iii)
agreements to pay or perform upon a second Person's failure to pay or perform,
(iv) remaining liable on obligations assumed by a second Person, (v) agreements
to maintain the capital, working capital solvency or general financial condition
of a second Person and (vi) agreements for the purchase or other acquisition of
products, materials, supplies or services, if in any case payment therefor is to
be made regardless of the non-delivery of such products, materials or supplies
or the non-furnishing of such services.
"Guaranty Agreement" means any guaranty agreement executed by a Guarantor
in favor of the Agent and the Lenders and in the form of Exhibit "D-1 or "D-2"
hereto, as applicable, together with all extensions, renewals, amendments,
substitutions and replacements thereof or thereto.
"Hazardous Substances" means any (i) hazardous, toxic or polluting
substances or wastes as defined by any Environmental Law or (ii) petroleum
products.
- 8 -
"Hedging Obligation" means, with respect to any Person, all liabilities of
such Person under interest rate swap agreements, interest rate cap agreements
and interest rate collar agreements, and all other agreements or arrangements
designed to protect such Person against fluctuations in interest rates or
currency exchange rates.
"Historical EBITDDA" means $40,250,000.
"Indebtedness" as applied to any Person means, without duplication, all
liabilities of such Person for borrowed money (other than trade accounts payable
arising in the ordinary course of business), direct or contingent (excluding any
FASB 5 adjustments or accruals), whether evidenced by a bond, note, debenture,
book entry or otherwise, and all obligations and liabilities in the nature of a
capitalized lease obligation, deferred purchase price arrangement, title
retention device, letter of credit obligation, Hedging Obligation, reimbursement
agreement, or Guaranty, however evidenced.
"Interest Period" means, subject to the provisions of Subsection 2.2c, any
individual period of one (1), two (2), three (3) or six (6) months selected by
the Borrower commencing on the Borrowing Date, conversion date or renewal date
of a Euro-Rate Portion to which such period shall apply.
"Lease" means any lease, mineral lease, mining agreement or other
agreement to which the Borrower or any Subsidiary is a party and pursuant to
which one Person transfers or grants to another Person the right to extract,
mine or otherwise remove coal.
"Lender" has the meaning given in the preamble to this Agreement.
"Letter of Credit" has the meaning given it in Subsection 2.6a.
"Letter of Credit Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been reimbursed on the
date when made and shall not have been converted into a Revolving Credit Loan
under Subsection 2.6d(ii).
"Letter of Credit Fee" has the meaning given it in Subsection 2.6b.
"Letters of Credit Outstanding" means at any time the sum of (i) the
aggregate undrawn face amount of outstanding Letters of Credit and (ii) the
aggregate amount of all unpaid and outstanding Reimbursement Obligations.
"Loan Account" means the loan account maintained by the Agent as more
fully described in Section 2.11.
"Loan Documents" means collectively this Agreement, the Revolving Credit
Notes, each Guaranty Agreement, each Letter of Credit and any application
relating thereto, and any other documents executed and delivered in connection
herewith.
"Loan Party" means the Borrower and each Guarantor.
- 9 -
"Margin Stock" is defined herein as defined in Regulation U.
"Material Adverse Change" means any set of circumstances or events which
(a) has or could reasonably be expected to have any material adverse effect upon
the validity or enforceability of this Agreement or any of the other Loan
Documents, (b) is or could reasonably be expected to be material and adverse to
the business, properties, assets, financial condition or results of operations
of the Parent, the Borrower and its Subsidiaries, taken as a whole, (c) impairs
materially or could reasonably be expected to impair materially the ability of
the Parent, the Borrower and its Subsidiaries taken as a whole to duly and
punctually pay their Indebtedness, or (d) impairs materially or could reasonably
be expected to impair materially the ability of the Agent or any of the Lenders
to enforce their legal remedies pursuant to this Agreement or any other Loan
Document.
"Material Contract" means any individual Lease or, collectively, group of
Leases, from the Borrower or any of its Subsidiaries to a single operator or
such operator's Affiliates which either (i) accounted for fifteen percent (15%)
or more of the gross revenues from royalties of the Borrower and its
Subsidiaries for the previous Fiscal Year, or (ii) is projected to account for
fifteen percent (15%) or more of the gross revenues from royalties of the
Borrower and its Subsidiaries for the current Fiscal Year, as shown on the
projections delivered to the Agent by the Borrower pursuant to Section 4.2(x)
below.
"MLP Agreement" means the First Amended and Restated Partnership Agreement
of the Parent dated October 17, 2002, as amended, restated, or replaced from
time to time to the extent permitted under the Loan Documents.
"Multiemployer Plan" means any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to
which the Borrower or any ERISA Affiliate is then making or accruing an
obligation to make contributions or, within the preceding five Plan years, has
made or had an obligation to make such contributions.
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
"Omnibus Agreement" means that certain Omnibus Agreement, dated October
17, 2002, by and among the General Partner, the Parent, the Borrower, GP Natural
Resource Partners LLC, WPP Group, Arch Coal, Ark Land Company, and Xxxxxxxxx
Coal Management LLC, which provides, among other things, certain non-competition
provisions and indemnities for environmental and tax liabilities.
"Option" means any one or both of the Base Rate Option or the Euro-Rate
Option.
"Parent" means Natural Resource Partners L.P., a Delaware limited
partnership and its successors and permitted assigns.
"Participant" means any financial institution or other Person to which a
Lender sells a Participation in its Revolving Credit Loan in accordance with
Subsection 9.6c.
- 10 -
"Participation" means the sale by a Lender to any Participant of an
undivided interest in all or any part of such Lender's Revolving Credit Loan.
"Participation Advance" means, with respect to any Lender, such Lender's
payment in respect of its participation in a Letter of Credit Borrowing
according to its Ratable Share pursuant to Subsection 2.6d.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
Person.
"Permitted Acquisition" has the meaning given it in Section 5.4.
"Permitted Assets" means (i) Property substantially of the type owned by,
and commonly used in the lines of business engaged by, the general and limited
partners of the General Partner, the Parent, the Borrower and their respective
Subsidiaries on the date hereof, (ii) any property interests in Coal and related
rights and interests, (iii) creation and/or restoration of wetlands and wetlands
credits, and (iv) any and all Property, real or personal, held for use or useful
in connection with the operating, working or development of any of the foregoing
and including any and all surface leases, rights-of-way, easements and
servitudes.
"Permitted Encumbrance" means, as to any Person, any of the following:
(i) Encumbrances for taxes, assessments, governmental charges or
levies on any of such Person's properties, which taxes, assessments,
governmental charges or levies are at the time not due and payable or if
they can thereafter be paid without penalty or are being contested in good
faith by appropriate proceedings diligently conducted and with respect to
which the affected Person has created adequate reserves;
(ii) Pledges or deposits to secure payment of workers' compensation
obligations, unemployment insurance, deposits or indemnities to secure
public or statutory obligations or for similar purposes;
(iii) Encumbrances arising out of judgments or awards against such
Person not giving rise to an Event of Default, provided that such judgment
or award is paid within thirty (30) days of its entry unless such judgment
is subject to an appeal in which case adequate reserves shall have been
set aside for the payment thereof;
(iv) Mechanics', carriers', workmen's, repairmen's, operator's,
vendor's, warehousemen's, supplier's, worker's, materialmen's,
construction, securities intermediaries or other similar Encumbrances
arising by operation of law and incurred in the ordinary course of such
Person's business, so long as the obligation secured is not overdue or, if
overdue, is being contested in good faith by appropriate actions or
proceedings diligently conducted;
(v) Security interests in favor of lessors of personal property,
which property is the subject of a true lease between such lessor and such
Person:
- 11 -
(vi) Encumbrances securing Indebtedness existing on the Closing Date
without enlargement or extension of the Indebtedness secured thereby or
the assets encumbered thereby (any such Encumbrance securing Indebtedness
on the Closing Date is listed on Schedule 5.2);
(vii) Easements, rights-of-way, restrictions, leases or subleases to
others or other similar Encumbrances created in the ordinary course of
business which Encumbrances do not interfere in any material respect with
the ordinary conduct of the business of the Borrower or any of its
Subsidiaries;
(viii) Encumbrances arising solely by virtue of any statutory or
common law provision relating to banker's liens, rights of set-off or
similar rights and remedies and burdening only deposit accounts or other
funds maintained with a creditor depository institution, provided that (a)
no such deposit account is a dedicated cash collateral account or is
subject to restrictions against access by the depositor in excess of those
set forth by regulations promulgated by the Board of Governors of the
Federal Reserve System, and (b) no such deposit account is intended by the
Borrower or any of its Subsidiaries to provide collateral to the
depository institution;
(ix) Encumbrances (other than to secure the payment of borrowed
money or the deferred purchase price of property or services), easements,
restrictions, servitudes, permits, conditions, covenants, exceptions or
reservations in any property of the Borrower or any Subsidiary, for the
purpose of roads, pipelines, transmission lines, transportation lines,
distribution lines for the removal of gas, oil, coal or other minerals or
timber, and other like purposes, or for the joint or common use of real
estate, rights of way, facilities and equipment and defects,
irregularities, zoning restrictions and deficiencies in title of any
property that in the aggregate do not materially impair the use of such
property for the purposes of which such property is held by the Borrower
or any Subsidiary or materially impair the value of such property subject
thereto; and
(x) Encumbrances securing (i) the performance (not more than 60 days
delinquent) of bids, trade contracts (other than for borrowed money),
leases, statutory obligations, (ii) contingent obligations on surety and
appeal bonds, and (iii) other obligations of a like nature (so long as the
performance of such obligations is not more than 60 days delinquent); in
each case, incurred in the ordinary course of business, provided all such
Encumbrances in the aggregate does not or could not (even if enforced)
reasonably be expected to cause a Material Adverse Change.
"Permitted Investments" means the following:
(i) Readily marketable direct obligations of the Government of the
United States or any agency or instrumentality thereof or obligations
unconditionally guaranteed by the full faith and credit of the Government
of the United States and having a maturity not greater than twelve (12)
months;
- 12 -
(ii) Commercial paper maturing in 180 days or less rated not lower
than A-1 by S&P or P-1 by Moody's on the date of acquisition; and
(iii) Dollar denominated demand deposits, time deposits or
certificates of deposit maturing within one year in domestic commercial
banks of recognized standing having capital and surplus in excess of
$250,000,000 and whose commercial paper or other short-term unsecured debt
obligations are rated A-1 or the equivalent or better by S&P or P-1 or the
equivalent or better by Moody's on the date of acquisition.
"Person" means any individual, partnership, corporation, trust, joint
venture, banking association, unincorporated organization or any other entity or
enterprise or government or department or agency thereof.
"Plan" means at any time an employee pension benefit plan (not including a
Multiemployer Plan) which is covered by Title IV of ERISA or is subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained by the Borrower or any ERISA Affiliate for employees of
the Borrower or any ERISA Affiliate or (ii) has at any time within the preceding
five years been maintained by any entity which was at such time an ERISA
Affiliate for employees of any entity which was an ERISA Affiliate.
"Portion" means either the Base Rate Portion, the Euro-Rate Portion, or
both of the foregoing, as the case may be.
"Potential Default" means an event which, with the passage of time or the
giving of notice or both, shall be an Event of Default.
"Prime Rate" means the interest rate per annum announced from time to time
by the PNC Bank, National Association as its prime rate, which rate may not be
the lowest rate of interest then being charged by the PNC Bank, National
Association to its commercial borrowers.
"Pro Forma Compliance Certificate" means a Pro Forma Compliance
Certificate substantially in the form of Exhibit "G".
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Purchasing Lender" has the meaning given it in Subsection 9.6a.
"Quarterly Distributions" means the distributions by the Parent of
Available Cash.
"Ratable Share" means the proportion that a Lender's Revolving Credit
Commitment bears to the aggregate Revolving Credit Commitments of the Lenders.
"Register" has the meaning given it in Subsection 9.6b.
- 13 -
"Regulation D" means Regulation D promulgated by the Board of Governors of
the Federal Reserve System (12 C.F.R. Part 204 et seq.) as such regulation is
now in effect and as may hereafter be amended.
"Regulation T" means Regulation T promulgated by the Board of Governors of
the Federal Reserve System (12 C.F.R. Part 204 et seq.) as such regulation is
now in effect and as may hereafter be amended.
"Regulation U" means Regulation U promulgated by the Board of Governors of
the Federal Reserve System (12 C.F.R. Part 221 et seq.) as such regulation is
now in effect and as may hereafter be amended.
"Regulation X" means Regulation X promulgated by the Board of Governors of
the Federal Reserve System (12 C.F.R. Part 224 et seq.) as such regulation is
now in effect and as may hereafter be amended.
"Reimbursement Obligation" has the meaning given it in Subsection
2.6d(ii).
"Reportable Event" means any one or more event, defined in Section 4043(b)
of ERISA and in 29 C.F.R. Part 2615, other than an event for which the
requirement for the thirty (30) day notice to the PBGC is waived.
"Required Lenders" means as of a particular date, the Lenders then holding
at least sixty-six and two-thirds percent (66-2/3%) of the sum of the aggregate
Revolving Credit Commitments (whether or not utilized) of all of the Lenders
then in effect and, after the termination of the Revolving Credit Commitments,
the Lenders then holding at least sixty-six and two-thirds percent (66-2/3%) of
the sum of the aggregate principal amount of the Revolving Credit Loans and the
Letters of Credit Outstanding, both at the particular time outstanding; provided
that in any event if one Lender holds at least the minimum percentages set forth
above at the time of any determination of Required Lenders, the term "Required
Lenders" shall be adjusted to include both the minimum percentage requirement
plus the vote of two Lenders if there is more than one Lender.
"Restricted Payment" has the meaning given it in Section 5.1.
"Revolving Credit Commitment" means, as to each Lender, the obligation of
such Lender to make Revolving Credit Loans available to the Borrower pursuant to
Section 2.1 in an aggregate principal amount not to exceed the amount captioned
"Revolving Credit Commitment" set opposite such Lender's name on the signature
pages hereto and thereafter on Schedule 1 of any relevant Assignment and
Assumption Agreement (as the same may be reduced at any time or from time to
time pursuant to Section 2.10) and, as to all Lenders, the obligation of the
Lenders to make Revolving Credit Loans available to the Borrower in an aggregate
amount equal to the Revolving Credit Commitments of all of the Lenders.
"Revolving Credit Commitment Percentage" means, as to each Lender, the
percentage of the Revolving Credit Commitment set forth opposite such Lender's
name on the signature pages hereto as such amount may change from time to time
in accordance with the terms hereof.
- 14 -
"Revolving Credit Loan" means a Disbursement by a Lender to the Borrower
pursuant to Section 2.1.
"Revolving Credit Loan Request" has the meaning given it in Subsection
2.1d.
"Revolving Credit Notes" means any one or all of the several promissory
notes of the Borrower evidencing Indebtedness of the Borrower under the
Revolving Credit Commitments which notes are substantially in the form of
Exhibit "A" to the Agreement, together with all extensions, renewals,
amendments, modifications, substitutions and replacements thereto and thereof.
"S&P" means Standard & Poor's Rating Group, a division of XxXxxx-Xxxx,
Inc. and its successors.
"Solvent" means, with respect to any Person on a particular date, that on
such date (i) the fair value of the property of such Person is greater than the
total amount of liabilities, including, without limitation, contingent
liabilities, of such Person, (ii) the present fair salable value of the assets
of such Person is not less than the amount that will be required to pay the
probable liability of such Person on its debts as they become absolute and
matured, (iii) such Person is able to realize upon its assets and pay its debts
and other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (iv) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature, and (v) such
Person is not engaged in business or a transaction, and is not about to engage
in business or a transaction, for which such Person's property would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged or proposes to engage.
In computing the amount of contingent liabilities at any time, it is intended
that such liabilities will be computed at the amount which, in light of all the
facts and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability.
"SPC" has the meaning given it in Subsection 9.6d.
"Subsidiary" of any Person at any time means (i) any corporation or trust
of which more than 50% (by number of shares or number of votes) of the
outstanding capital stock or shares of beneficial interest normally entitled to
vote for the election of one or more directors or trustees (regardless of any
contingency which does or may suspend or dilute the voting rights) is at such
time owned directly or indirectly by such Person or one or more of such Person's
Subsidiaries, (ii) any partnership of which such Person is a general partner or
of which more than 50% of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person's Subsidiaries, or
(iii) any limited liability company of which such Person is a member or of which
more than 50% of the limited liability company interests is at the time directly
or indirectly owned by such Person or one or more of such Person's Subsidiaries.
Unless otherwise specified, all references herein to a "Subsidiary" or to
"Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.
- 15 -
"Termination Date" means the date which is three (3) years after the
Closing Date.
"Termination Proceedings" means any action taken by the PBGC under ERISA
to terminate any plan.
"Transaction" means, collectively, (i) the formations, mergers,
contributions and other transfers of interests in certain corporations, limited
liability companies and/or partnerships, (ii) the conveyances of assets and
properties, (iii) the sale to the public of 4,500,000 common units in the Parent
by the Parent and Arch Coal, (iv) the disposition of the proceeds of such sale,
and (v) those certain other actions to occur on or before the Closing Date as
contemplated and described in the Form S-1.
"Transfer Effective Date" has the meaning given it in each respective
Assignment and Assumption Agreement.
"Transferor Lender" has the meaning given it in Subsection 9.6a.
"WPP Group" means, collectively, Western Pocahontas Properties Limited
Partnership, a Delaware limited partnership, Great Northern Properties Limited
Partnership, a Delaware limited partnership, and New Gauley Coal Corporation, a
West Virginia corporation.
1.2 ACCOUNTING PRINCIPLES. Except as otherwise provided in this Agreement, all
computations and determinations as to accounting or financial matters and all
financial statements to be delivered pursuant to this Agreement shall be made
and prepared in accordance with GAAP (including principles of consolidation
where appropriate), and all accounting or financial terms shall have the
meanings ascribed to such terms by GAAP; provided, however, that all accounting
terms used in Section 5.3 (and all defined terms used in the definition of any
accounting term used in Section 5.3) shall have the meaning given to such terms
(and defined terms) under GAAP as in effect on the date hereof applied on a
basis consistent with those used in preparing the financial statements referred
to in Subsection 3.7a. In the event of any change after the date hereof in GAAP,
and if such change would result in the inability to determine compliance with
the financial covenants set forth in Section 5.3 based upon the Parent's
regularly prepared financial statements by reason of the preceding sentence,
then the parties hereto agree to endeavor, in good faith, to agree upon an
amendment to this Agreement that would adjust such financial covenants in a
manner that would not affect the substance thereof, but would allow compliance
therewith to be determined in accordance with the Parent's financial statements
at that time.
1.3 OTHER DEFINITIONAL CONVENTIONS AND RULES OF CONSTRUCTION. (i) The words
"hereof," "herein" and "hereunder" and words of similar import when used in this
Agreement shall, unless otherwise expressly specified, refer to this Agreement
as a whole and not to any particular provision of this Agreement, and Article,
Section and Subsection references are to this Agreement unless otherwise
expressly specified.
(ii) All terms defined in this Agreement in the singular shall have
comparable meanings when used in plural, and vice versa, unless otherwise
specified.
- 16 -
(iii) The word "or" as used herein shall mean and connote nonexclusive
alternatives, unless expressly stated or the context clearly requires otherwise.
2. THE REVOLVING CREDIT LOANS
2.1 REVOLVING CREDIT LOANS.
2.1a REVOLVING CREDIT FACILITY . Subject to the terms and conditions hereof and
relying upon the representations and warranties herein set forth, each Lender
severally agrees to make Revolving Credit Loans to the Borrower at any time from
time to time on or after the date hereof to, but not including, the Termination
Date, provided that the aggregate principal amount of each Lender's Revolving
Credit Loans outstanding hereunder to the Borrower shall not exceed at any one
time an amount equal to such Lender's Revolving Credit Commitment Percentage of
the aggregate Revolving Credit Commitments minus such Lender's Ratable Share of
the Letters of Credit Outstanding. Within such limits of time and amount and
subject to the other provisions of this Agreement, the Borrower may borrow,
repay and reborrow pursuant to this Subsection 2.1a. The aggregate amount of the
Revolving Credit Commitments on the Closing Date is $100,000,000. Each Revolving
Credit Loan shall be designated at the time of borrowing by the Borrower, based
upon its intended use, as either a General Revolving Loan or a Distribution
Loan. General Revolving Credit Loans shall be available to the Borrower solely
for the purposes set forth in Section 4.1(i) (each such Revolving Credit Loan, a
"General Revolving Credit Loan"). Distribution Loans shall be available for the
purposes set forth in Section 4.1(ii) and shall not exceed $12,000,000 in the
aggregate at any one time outstanding (each such Revolving Credit Loan, a
"Distribution Loan"), subject to the requirements of Section 4.12 hereof.
2.1b REVOLVING CREDIT COMMITMENT OF EACH LENDER. The obligations of each Lender
to make Revolving Credit Loans hereunder are several. The failure of any Lender
to make Revolving Credit Loans hereunder shall not affect the obligations of the
Borrower, or any other Lender, to any other party nor shall the Borrower, or any
other Lender, be liable for the failure of such Lender to make Revolving Credit
Loans hereunder. The Lenders shall have no obligation to make Revolving Credit
Loans hereunder on or after the Termination Date.
2.1c REVOLVING CREDIT NOTES. The obligation of the Borrower to repay, on or
before the Termination Date, the aggregate unpaid principal amount of all
Revolving Credit Loans shall be evidenced by the several Revolving Credit Notes,
each substantially in the form of Exhibit "A" hereto, drawn by the Borrower to
the order of a Lender in the maximum amount of such Lender's Revolving Credit
Commitment. The principal amount actually due and owing to a Lender at any time
with respect to its Revolving Credit Commitment shall be the then aggregate
unpaid principal amount of all Revolving Credit Loans made by such Lender as
shown on the Loan Account established and maintained by the Agent in accordance
with Section 2.11. Each Revolving Credit Note shall be dated the date hereof (or
such other date as provided in Section 9.6) and shall be delivered to the
Lenders on such date.
2.1d REVOLVING CREDIT LOAN REQUEST. Except as otherwise provided herein, the
Borrower may from time to time prior to the Termination Date request the Lenders
to make Revolving
- 17 -
Credit Loans to the Borrower by the delivery to the Agent, not later than 11:00
A.M. (eastern time) (i) three (3) Business Days prior to the proposed Borrowing
Date with respect to the making of Revolving Credit Loans to which the Euro-Rate
Option applies; and (ii) on the Business Day of the proposed Borrowing Date with
respect to the making of Revolving Credit Loans to which the Base Rate Option
applies of a duly completed request therefor substantially, in the form of
Exhibit "B" hereto or a request by telephone immediately confirmed in writing by
letter or facsimile in such form (each, a "Revolving Credit Loan Request"), it
being understood that the Agent may rely on the authority of any person making
such a telephonic request without the necessity of receipt of such written
confirmation. Each Revolving Credit Loan Request shall be irrevocable and shall
specify (i) the proposed Borrowing Date; (ii) whether the Revolving Credit Loan
is a General Revolving Loan or a Distribution Loan; (iii) the aggregate amount
of the proposed Revolving Credit Loans to be made on such Borrowing Date, which
amount, as to Base Rate Portions of Revolving Credit Loans, shall be in integral
multiples of $100,000 and not less than $300,000, and, as to Euro-Rate Portions
of Revolving Credit Loans, shall be in integral multiples of $1,000,000 and not
less than $3,000,000; (iv) whether the Euro-Rate Option or the Base Rate Option
shall apply to the proposed Revolving Credit Loans to be made on such Borrowing
Date; and (v) in the case of Revolving Credit Loans to which the Euro-Rate
Option applies, an appropriate Interest Period for each Euro-Rate Portion of the
Revolving Credit Loans to be made on such Borrowing Date.
2.1e MAKING REVOLVING CREDIT LOANS. The Agent shall, promptly after receipt by
it of a Revolving Credit Loan Request pursuant to Subsection 2.1d (but not later
than noon (eastern time) on the Borrowing Date for same day funding and 2:00
P.M. (eastern time) on the second Business Day preceding any Borrowing Date for
which any Portion of the Revolving Credit Loans to be made on such Borrowing
Date bears interest at the Euro-Rate Option), notify the Lenders of its receipt
of such Revolving Credit Loan Request specifying: (i) the proposed Borrowing
Date and the time and method of disbursement of such Revolving Credit Loan; (ii)
the amount and type of such Revolving Credit Loan and the applicable Euro-Rate
Portions and Interest Periods (if any); and (iii) the apportionment among the
Lenders of the Revolving Credit Loans as determined by the Agent in accordance
with Subsection 2.1a hereof. Each Lender shall remit the principal amount of
each Revolving Credit Loan to the Agent such that the Agent is able to, and the
Agent shall, to the extent the Lenders have made funds available to it for such
purpose, fund such Revolving Credit Loan to the Borrower in Dollars and
immediately available funds at the principal office of the Agent in Pittsburgh,
Pennsylvania prior to 2:00 P.M. (eastern time) on the Borrowing Date, provided
that if any Lender fails to remit such funds to the Agent in a timely manner, or
any Lender fails to advise the Agent of its intention not to fund, then the
Agent may elect in its sole discretion to fund with its own funds the Revolving
Credit Loan of such Lender on the Borrowing Date, subject to the provisions of
Section 8.3 below.
2.2 INTEREST RATES, INTEREST PAYMENT AND CERTAIN PROVISIONS RELATING TO INTEREST
AND FEES.
2.2a PAYMENTS OF INTEREST. The Borrower shall pay interest on the principal
amount of the Revolving Credit Loans from time to time outstanding hereunder,
from the date thereof until paid in full, at the rates of interest determined
pursuant to this Section 2.2. The Borrower shall pay accrued interest on the
unpaid principal balance of the Revolving Credit Loans in arrears:
- 18 -
(i) with respect to each Base Rate Portion, at the Base Rate on the last day of
each Fiscal Quarter during the term thereof; (ii) with respect to each Euro-Rate
Portion, at the Adjusted Euro-Rate on the last day of each Interest Period as
provided for in Subsection 2.3c (provided, however, if the Interest Period
chosen for a Euro-Rate Portion exceeds three (3) months, interest on that
Euro-Rate Portion shall be due and payable on the day which is (A) three months
after the first day of such Interest Period and (B) the last day of such
Interest Period); and (iii) with respect to all such Portions, at the applicable
interest rate (A) when due, at maturity, whether by acceleration or otherwise,
and (B) after maturity, on demand until paid in full.
2.2b INTEREST RATE OPTIONS. The unpaid principal amount of the Revolving Credit
Loans shall bear interest, for each day until due, at one or more rates of
interest selected by the Borrower from among the Options set forth below; it
being understood that, subject to the provisions of this Agreement, the Borrower
may select different Options to apply simultaneously to different Portions of
the Revolving Credit Loans and may select different Interest Periods to apply
simultaneously to different Portions of the Euro-Rate Portions of the Revolving
Credit Loans.
(i) Base Rate Option: A rate of interest per annum (computed upon
the basis of a year of 365 or 366 days, as the case may be, and the actual
number of days elapsed) equal to the Base Rate. The rate of interest per
annum under the Base Rate Option shall be adjusted automatically, from
time to time, upon each change in the Base Rate.
(ii) Euro-Rate Option: A rate of interest per annum (computed on the
basis of a year of 360 days and the actual number of days elapsed) equal
to the sum of (A) the Euro-Rate plus (B) the Applicable Euro-Rate Margin
from time to time in effect (the "Adjusted Euro-Rate"). The Adjusted
Euro-Rate for each Euro-Rate Portion then outstanding shall be adjusted
automatically, from time to time, effective upon each change in the
Applicable Euro-Rate Margin resulting from an increase or decrease in the
Parent's ratio of Consolidated Total Indebtedness to Consolidated EBITDDA.
2.2c INTEREST PERIODS; LIMITATIONS ON ELECTIONS. At any time when the Borrower
shall select, convert to or renew at the Euro-Rate Option with respect to all or
any Portion of the outstanding Revolving Credit Loans, it shall fix one or more
Interest Periods during which such Option(s) shall apply. All of the foregoing,
however, is subject to the following:
(i) any Interest Period which would otherwise end on a day which is
not a Business Day shall be extended to the next Business Day unless such
Business Day falls in the succeeding calendar month in which case such
Interest Period shall end on the next preceding Business Day; and
(ii) any Interest Period which begins on the last day of a calendar
month or on a day for which there is no numerically corresponding day in
the subsequent calendar month during which such Interest Period is to end
shall end on the last Business Day of such subsequent month.
- 19 -
In addition, elections by the Borrower of the Euro-Rate Option shall
be subject to the following further limitations:
(A) The Euro-Rate Portions for each Interest Period shall be in
integral multiples of $1,000,000 and not less than $3,000,000;
(B) If an Interest Period is elected and such Interest Period would
end after the Termination Date, such Interest Period shall end on the
Termination Date; and
(C) At no time may there be more than six (6) Interest Periods in
effect relating to Revolving Credit Loans; provided, however if a Base
Rate Portion is outstanding there shall be not more than five (5) Interest
Periods in effect relating to Revolving Credit Loans.
2.2d ELECTION, CONVERSION OR RENEWAL OF INTEREST RATE OPTIONS. Elections of or
conversions to the Base Rate Option shall continue in effect until converted to
the Euro-Rate Option as hereinafter provided. Elections of, conversions to or
renewals of the Euro-Rate Option shall expire as to each Euro-Rate Portion at
the expiration of the applicable Interest Period.
At any time, with respect to any Base Rate Portion, or at the expiration
of the applicable Interest Period, with respect to any Euro-Rate Portion, the
Borrower (subject to Subsection 2.2c) may cause all or any part of the principal
amount of such Portion to be converted to and/or (in the case of a Euro-Rate
Portion) to be renewed under the Euro-Rate Option by notice to each of the
Lenders as hereinafter provided. Such notice (i) shall be irrevocable; (ii)
shall be given not later than 11:00 A.M. (eastern time) in the case of a
conversion to or renewal of, either in whole or in part, the Euro-Rate Option on
the third Business Day prior to the proposed effective date for the conversion
or renewal; and (iii) shall set forth:
(A) the effective date of such conversion or renewal, which shall be
a Business Day;
(B) the new Interest Period(s) selected; and
(C) with respect to each such Interest Period, the aggregate
principal amount of the corresponding Euro-Rate Portion.
At the expiration of each Interest Period, any part (including the whole)
of the principal amount of the corresponding Euro-Rate Portion as to which no
notice of conversion or renewal has been received as provided above, shall
automatically be converted to the Base Rate Option.
2.2e NOTIFICATION OF ELECTION OF AN INTEREST RATE OPTION. Any communication
under Subsection 2.1d, 2.2b or 2.2d may be oral or written and if oral, it shall
be followed immediately by written confirmation of such Option election executed
by an Authorized Officer.
2.2f INTEREST AFTER DEFAULT. (A) Any amount not paid when due (including
interest), whether by acceleration or otherwise and whether or not judgment has
been entered against the Borrower
- 20 -
thereon, shall bear interest at a rate per annum which shall be two hundred
(200) basis points (2%) per annum above the rate otherwise in effect with
respect to such amount.
(B) Upon the occurrence of an Event of Default, and during the
continuance of such Event of Default, upon notice from the Agent (acting
upon the instructions of the Required Lenders) to the Borrower: (i) all
Base Rate Portions shall bear interest at a rate per annum which shall be
two hundred (200) basis points (2%) per annum above the rate otherwise in
effect under the Base Rate Option, such interest rate to change
automatically from time to time, effective as of the effective date of
each change in the Base Rate; and (ii) all Euro-Rate Portions shall bear
interest (i) until the end of the then current Interest Period, at a rate
per annum which shall be two hundred (200) basis points (2%) per annum
above the rate otherwise in effect under the Euro-Rate Option, and (ii) at
the end of the then current Interest Period, and thereafter at the sum of
(A) the Base Rate plus (B) two hundred (200) basis points (2%) per annum.
2.3 YIELD-PROTECTION, CAPITAL ADEQUACY AND MISCELLANEOUS PROVISIONS RELATING TO
EURO-RATE.
2.3a YIELD PROTECTION. Notwithstanding other provisions of this Section 2.3:
(a) With respect to any Lender, if, after the date hereof, any
adoption of or any change in or in the interpretation of any Governmental
Rule, shall:
(i) subject such Lender to any tax, levy, impost charge,
fee, duty, deduction or withholding of any kind with respect to payments
of principal or interest or other amounts due hereunder (other than any
tax imposed or based upon the income, gross receipts or capital or
franchise taxes of such Lender and payable to any Governmental Authority
in the United States of America or any state thereof and other than taxes
due by a failure of such Lender to comply with Section 9.4); or
(ii) change the basis of taxation of such Lender with
respect to payments of principal or interest or other amounts due
hereunder (other than any change which affects, and only to the extent
that it affects, the taxation by the United States or any state thereof of
the total net income of such Lender); or
(iii) impose, modify or deem applicable any reserve,
special deposit or similar requirements against assets held by such Lender
applicable to its Revolving Credit Commitment or Revolving Credit Loans
made hereunder (other than such requirements which are included in the
determination of the applicable rate of interest hereunder); or
(iv) impose upon such Lender any other obligation or
condition with respect to this Agreement.
and the result of any of the foregoing is to increase the cost to the
affected Lender, reduce the income receivable by the affected Lender,
reduce the rate of return on the affected Lender's capital, or impose any
expenses upon the affected Lender, all with respect to any of the
- 21 -
Revolving Credit Loans (or any portion thereof) by an amount which the
affected Lender reasonably deems material, and if the affected Lender is
then demanding similar compensation for such occurrences from other
borrowers who are similarly situated and who have a similar relationship
with the affected Lender and from which the affected Lender has the right
to demand such compensation, then and in any such case:
(A) the affected Lender shall promptly notify the
Borrower of the happening of such event;
(B) the Borrower shall pay to the affected Lender,
within two (2) Business Days of demand, such
amount as will compensate the affected Lender for
such reduction in its rate of return; and
(C) the Borrower may pay the affected portion of the
affected Lender's Revolving Credit Loans in full
without the payment of any additional amount,
including prepayment penalties, other than amounts
payable on account of the affected Lender's
out-of-pocket losses (including funding loss, if
any, as provided in Section 2.9) which are not
otherwise provided for in subparagraph (B)
immediately above.
Notwithstanding the foregoing, if any Lender demands compensation from the
Borrower under this Section 2.3a more than 180 days after such Lender had
knowledge of the occurrence of the event giving rise to such claim for
compensation, the Borrower shall not be obligated to reimburse such Lender for
amounts incurred as a result of the occurrence of such event more than 180 days
prior to the date on which the Lender made such demand (provided that if the
event giving rise to claim for compensation or indemnification is retroactive,
then such 180 day period shall be extended to include the period of retroactive
effect).
(b) A certificate as to the increased cost or reduced amount
as a result of any event mentioned in this Subsection 2.3a shall be
promptly submitted by the affected Lender to the Borrower in accordance
with the provisions hereof. Such certificate shall be prima facie evidence
as to the amount of such increased cost or reduced amount.
2.3b CAPITAL ADEQUACY. If, after the date hereof, (i) any adoption of or any
change in or in the interpretation of any Governmental Rule, or (ii) compliance
with any Governmental Rule of any Governmental Authority exercising control over
banks or financial institutions generally or any court of competent
jurisdiction, requires that the Revolving Credit Commitment (including, without
limitation, obligations in respect of any Revolving Credit Loans) hereunder be
treated as an asset or otherwise be included for purposes of calculating the
appropriate amount of capital to be maintained by any Lender or any corporation
controlling any Lender (a "Capital Adequacy Event") the result of which is to
reduce the rate of return on a Lender's capital as a consequence of its
Revolving Credit Commitment to a level below that which the affected Lender
could have
- 22 -
achieved but for such Capital Adequacy Event, taking into consideration the
Lender's policies with respect to capital adequacy, by an amount which the
affected Lender reasonably deems to be material, the affected Lender shall
promptly deliver to the Borrower a statement of the amount necessary to
compensate the affected Lender or the reduction in the rate of return on its
capital attributable to its Revolving Credit Commitment (the "Capital
Compensation Amount"). The affected Lender shall determine the Capital
Compensation Amount in good faith, using reasonable attribution and averaging
methods. Each affected Lender shall from time to time notify the Borrower of the
amount so determined. Each such notification shall be prima facie evidence of
the amount of the Capital Compensation Amount set forth therein, and such
Capital Compensation Amount shall be due and payable by the Borrower to the
affected Lender thirty (30) days after such notice is given. As soon as
practicable after any Capital Adequacy Event, the affected Lender shall submit
to the Borrower estimates of the Capital Compensation Amounts that would be
payable as a function of the affected Lender's Revolving Credit Commitment
hereunder. Notwithstanding the foregoing, if any Lender demands compensation
from the Borrower under this Section 2.3b more than 180 days after such Lender
had knowledge of the occurrence of the event giving rise to such claim for
compensation, the Borrower shall not be obligated to reimburse such Lender for
amounts incurred as a result of the occurrence of such event more than 180 days
prior to the date on which the Lender made such demand (provided that if the
event giving rise to claim for compensation or indemnification is retroactive,
then such 180 day period shall be extended to include the period of retroactive
effect).
2.3c EURO-RATE UNASCERTAINABLE. If, on any date on which the Adjusted Euro-Rate
would otherwise be set, the Agent reasonably shall have determined (which
determination shall be final and conclusive) that by reason of circumstances
affecting the interbank Eurodollar market, adequate and reasonable means do not
exist for ascertaining the Euro-Rate, the Agent shall give prompt notice of such
determination to the Borrower and the Lenders and, until the Agent notifies the
Borrower and the Lenders that the circumstances giving rise to such
determination no longer exist, the right of the Borrower to borrow under,
convert to or renew the Euro-Rate Option shall be suspended with respect to any
period for which the Euro-Rate is not ascertainable, and with respect to any
such period, any notice of borrowing under, conversion to or renewal of the
Euro-Rate Option which was to become effective during the period of such
suspension shall be treated as a request to borrow under, convert to or renew at
the Base Rate Option with respect to the principal amount therein specified.
2.3d ILLEGALITY. If a Lender shall determine in good faith (which determination
shall be final and conclusive) that compliance by such Lender with any
applicable law, treaty or other Governmental Rule (whether or not having the
force of law), or the interpretation or application thereof by any Governmental
Authority, has made it unlawful for such Lender to make or maintain the
Revolving Credit Loans under the Euro-Rate Option (including but not limited to
acquiring Eurodollar liabilities to fund such Revolving Credit Loans), such
Lender shall give notice of such determination to the Borrower and the other
Lenders. Notwithstanding any provision of this Agreement to the contrary, unless
and until the affected Lender shall have given notice to the Borrower and the
other Lenders that the circumstances giving rise to such determination no longer
apply:
- 23 -
(i) with respect to any Interest Periods thereafter commencing,
interest on the Revolving Credit Loans bearing interest at the Adjusted
Euro-Rate (whichever one or more have been determined by the affected
Lender to be unlawful) shall, unless the Borrower shall have selected a
different Option which is then available, be computed and payable under
the Base Rate Option; and
(ii) on such date, if any, as shall be required by law, any
Revolving Credit Loans bearing interest at the Adjusted Euro-Rate then
outstanding shall be automatically converted to the Base Rate Option, and
the Borrower shall pay to the affected Lender the accrued and unpaid
interest on such Revolving Credit Loans to (but not including) the date of
such conversion at the applicable interest rate or rates in effect for
such Revolving Credit Loans prior to such conversion.
2.4 FEES.
2.4a COMMITMENT FEE. The Borrower agrees to pay to the Agent on behalf of the
Lenders, on a pro rata basis, beginning on December 31, 2002, and continuing
quarterly in arrears thereafter on the last day of each March, June, September
and December during the term hereof to and including the Termination Date, a
Commitment Fee calculated at a rate per annum equal to the Commitment Fee Rate
on the average daily unused portion of the Revolving Credit Commitment for the
quarter then ending; provided, however, the first payment under this Subsection
2.4a shall be only for the actual number of days elapsed between the Closing
Date and December 31, 2002, and the last payment under this Subsection 2.4a
shall be only for the actual number of days elapsed between the last quarterly
payment date and the Termination Date.
2.4b AGENT'S FEE. The Borrower agrees to pay to the Agent for its own account
the non-refundable Agent's Fees for the Agent's services hereunder under the
terms of that certain letter (the "Agent's Letter") between the Borrower and the
Agent dated as of the Closing Date.
2.4c LETTER OF CREDIT FEE AND FRONTING FEE. The Borrower shall pay to the Agent,
from time to time, for the benefit of the Lenders, the Letter of Credit Fee as
set forth in Subsection 2.6b. The Borrower shall pay to the Agent, from time to
time, for its sole account, the Fronting Fee as set forth in Subsection 2.6b.
2.5 CALCULATION OF INTEREST AND CERTAIN FEES. The calculation of the amount of
interest due and owing to each Lender shall be made by the Agent and shall be
evidenced by the Agent posting the amount of interest due under such Lender's
Revolving Credit Loans to the Loan Account established pursuant to Section 2.11.
The Commitment Fee shall be calculated on the basis of a 360 day year and actual
number of days elapsed. The calculation of the amount of the Commitment Fee due
and owing to each Lender shall be made by the Agent and shall be evidenced by
posting such amount due under the Loan Account established pursuant to Section
2.11.
2.6 LETTER OF CREDIT SUB-FACILITY.
- 24 -
2.6a ISSUANCE OF LETTERS OF CREDIT. The Borrower may request the issuance of a
letter of credit (each a "Letter of Credit") by delivering to the Agent a
completed application and agreement for letters of credit in such form as the
Agent may specify from time to time by no later than 10:00 A.M., Pittsburgh,
Pennsylvania time, at least five (5) business Days, or such shorter period as
may be agreed to by the Agent, in advance of the proposed date of issuance. Each
Letter of Credit shall be denominated in Dollars. Subject to the terms and
conditions hereof and in reliance on the agreements of the other Lenders set
forth in this Section 2.6, the Agent will issue a Letter of Credit provided that
each Letter of Credit shall (A) have a maximum maturity of one year from the
date of issuance, and (B) in no event expire later than ten (10) Business Days
prior to the Termination Date and provided that in no event shall the aggregate
amount of Letters of Credit Outstanding exceed, at any one time, $2,000,000. The
amount of Letters of Credit Outstanding at any time shall reduce the maximum
amount otherwise available for Revolving Credit Loans under the Revolving Credit
Commitments. No Letters of Credit may be issued hereunder to the extent that
such issuance would cause the sum of (i) the Letters of Credit Outstanding plus
(ii) the aggregate amount of Revolving Credit Loans outstanding to exceed the
aggregate amount of Revolving Credit Commitments then in effect.
2.6b LETTER OF CREDIT FEES. The Borrower shall pay to the Agent for the ratable
account of the Lenders a fee (the "Letter of Credit Fee") equal to the
Applicable Euro-Rate Margin for Revolving Credit Loans (computed on the basis of
a year of 360 days and actual days elapsed), which fees shall be computed on the
daily average amount of the Letters of Credit Outstanding and shall be payable
quarterly in arrears commencing with the last day of each September, December,
March and June following issuance of each Letter of Credit. The Borrower shall
also pay to the Agent for the Agent's sole account (i) one-eighth of one percent
(.125%) per annum of the amount of any Letters of Credit Outstanding (the
"Fronting Fee") quarterly in arrears, and (ii) as incurred, the Agent's then
current customary fees and administrative expenses payable with respect to the
Letters of Credit as the Agent may generally charge or incur from time to time
in connection with the issuance, maintenance, modification (if any), assignment
or transfer (if any), negotiation, and administration of Letters of Credit.
2.6c LETTER OF CREDIT FEES UPON DEFAULT. (A) Upon the occurrence of an Event of
Default, and during the continuance of such Event of Default, upon notice from
the Agent (acting upon the instructions of the Required Lenders) to the
Borrower, or (B) upon the acceleration of the Bank Indebtedness for any reason
hereunder, the Letter of Credit Fee shall be automatically increased by two
percent (2%) in excess of the applicable Letter of Credit Fee then in effect.
2.6d DISBURSEMENTS, REIMBURSEMENT.
(i) Immediately upon the issuance of each Letter of Credit,
each Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the Agent a participation in such Letter of Credit and
each drawing thereunder in an amount equal to such Lender's Ratable Share of the
maximum amount available to be drawn under such Letter of Credit and the amount
of such drawing, respectively.
(ii) In the event of any request for a drawing under a Letter
of Credit by the beneficiary or transferee thereof, the Agent will promptly
notify the Borrower of the
- 25 -
amount of such drawing and the date such payment shall be made. The Borrower
shall reimburse (such obligation to reimburse the Agent shall sometimes be
referred to as a "Reimbursement Obligation") the Agent for any amount paid by
the Agent under any Letter of Credit (each such date of a payment by the Agent
under a Letter of Credit, a "Drawing Date") in an amount equal to the amount so
paid by the Agent. Such Reimbursement Obligation shall be paid prior to 12:00
noon, Pittsburgh, Pennsylvania time, on the Drawing Date. In the event the
Borrower fails to reimburse the Agent for the full amount of any drawing under
any Letter of Credit by 12:00 noon, Pittsburgh, Pennsylvania time, on the
Drawing Date, the Agent will promptly notify each Lender thereof, and the
Borrower shall be deemed to have requested that Revolving Credit Loans be made
by the Lenders under the Base Rate Option to be disbursed on the Drawing Date
under such Letter of Credit, subject to the amount of the unutilized portion of
the Revolving Credit Commitments and subject to the conditions set forth in
Section 6.1 other than any notice requirements. Any notice given by the Agent
pursuant to this Subsection 2.6d(ii) may be oral if immediately confirmed in
writing; provided that the lack of such an immediate confirmation shall not
affect the conclusiveness or binding effect of such notice.
(iii) Each Lender shall upon any notice pursuant to Subsection
2.6d(ii) make available to the Agent an amount in immediately available funds
equal to its Ratable Share of the amount of the drawing, whereupon the
participating Lenders shall (subject to Subsection 2.6d(iv)) each be deemed to
have made a Revolving Credit Loan under the Base Rate Option to the Borrower in
that amount. If any Lender so notified fails to make available to the Agent for
the account of the Agent the amount of such Lender's Ratable Share of such
amount by no later than 2:00 P.M., Pittsburgh, Pennsylvania time on the Drawing
Date, then interest shall accrue on such Lender's obligation to make such
payment, from the Drawing Date to the date on which such Lender makes such
payment (i) at a rate per annum equal to the Federal Funds Effective Rate during
the first three days following the Drawing Date and (ii) at a rate per annum
equal to the rate applicable to Revolving Credit Loans under the Base Rate
Option on and after the fourth day following the Drawing Date. The Agent will
promptly give notice of the occurrence of the Drawing Date to each Lender, but
failure of the Agent to give any such notice on the Drawing Date or in
sufficient time to enable any Lender to effect such payment on such date shall
not relieve such Lender from its obligation to make available its Ratable Share
of the amount of the drawing under this Subsection 2.6d(iii).
(iv) With respect to any unreimbursed drawing that is not converted
into Revolving Credit Loans under the Base Rate Option to the Borrower in whole
or in part as contemplated by Subsection 2.6d(ii), because of the Borrower's
failure to satisfy the conditions set forth in Section 6.1 other than any notice
requirements or for any other reason, the Borrower shall be deemed to have
incurred from the Agent a Letter of Credit Borrowing in the amount of such
drawing. Such Letter of Credit Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the rate per annum
applicable to the Revolving Credit Loans under the Base Rate Option as adjusted
to reflect the default rate provisions set forth in Subsection 2.2f. Each
Lender's payment to the Agent pursuant to Subsection 2.6d(iii) shall be deemed
to be a payment in respect of its participation in such Letter of Credit
Borrowing and shall constitute a Participation Advance from such Lender in
satisfaction of its participation obligation under this Subsection 2.6d. The
provisions of this Subsection (iv) are solely for the benefit of the Agent as
issuer of the Letters of Credit, and shall not be deemed to excuse, waive
- 26 -
or consent to an Event of Default under Section 7.1 arising from an unreimbursed
drawing giving rise to a Participation Advance.
2.6e REPAYMENT OF PARTICIPATION ADVANCES.
(A) Upon (and only upon) receipt by the Agent for its account of
immediately available funds from the Borrower (i) in reimbursement of any
payment made by the Agent under the Letter of Credit with respect to which any
Lender has made a Participation Advance to the Agent, or (ii) in payment of
interest on such a payment made by the Agent under such a Letter of Credit, the
Agent will pay to each Lender in the same funds as those received by the Agent,
the amount of such Lender's Ratable Share of such funds, except the Agent shall
retain the amount of the Ratable Share of such funds of any Lender that did not
make a Participation Advance in respect of such payment by Agent.
(B) If the Agent is required at any time to return to the Borrower,
or to a trustee, receiver, liquidator, custodian, or any official in any
proceeding described in Section 7.3. any portion of the payments made by the
Borrower to the Agent pursuant to Subsection 2.6d(ii) in reimbursement of a
payment made under the Letter of Credit or interest or fee thereon, each Lender
shall, on demand of the Agent, forthwith return to the Agent the amount of its
Ratable Share of any amounts so returned by the Agent plus interest thereon from
the date such demand is made to the date such amounts are returned by such
Lender to the Agent, at a rate per annum equal to the Federal Funds Effective
Rate in effect from time to time.
2.6f DOCUMENTATION. The Borrower agrees to be bound by the terms of the Agent's
application and agreement for letters of credit and the Agent's written
regulations and customary practices and interpretations relating to letters of
credit, though such practices and interpretation may be different from the
Borrower's own. In the event of a conflict between such application or agreement
and this Agreement, this Agreement shall govern. It is understood and agreed
that, except in the case of gross negligence or willful misconduct, the Agent
shall not be liable for any error and/or mistakes, whether of omission or
commission, in following the Borrower's instructions or those contained in the
Letters of Credit or any modifications, amendments or supplements thereto.
2.6g DETERMINATIONS TO HONOR DRAWING REQUESTS. In determining whether to honor
any request for drawing under any Letter of Credit by the beneficiary thereof,
the Agent shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been
delivered and that they comply on their face with the requirements of such
Letter of Credit.
2.6h NATURE OF PARTICIPATION AND REIMBURSEMENT OBLIGATIONS. Each Lender's
obligation in accordance with this Agreement to make the Revolving Credit Loans
or Participation Advances, as contemplated by Subsection 2.6d, as a result of a
drawing under a Letter of Credit, and the obligation of the Borrower to
reimburse the Agent upon a draw under a Letter of Credit, shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance
with the terms of this Section 2.6 under all circumstances, including the
following circumstances:
- 27 -
(i) any set-off, counterclaim, recoupment, defense or other
right which such Lender may have against the Agent, the Borrower or any other
Person for any reason whatsoever;
(ii) the failure of the Borrower or any other Person to
comply, in connection with a Letter of Credit Borrowing, with the conditions set
forth in Sections 2.1, 2.2 or 6.1 or as otherwise set forth in this Agreement
for the making of a Revolving Credit Loan, it being acknowledged that such
conditions are not required for the making of a Letter of Credit Borrowing and
the obligation of the Lenders to make Participation Advances under Subsection
2.6d; provided, however the aggregate amount thereof shall in no event exceed
the unutilized Revolving Credit Commitments;
(iii) any lack of validity or enforceability of any Letter of
Credit;
(iv) the existence of any claim, set-off, defense or other
right which the Borrower or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons for whom
any such transferee may be acting), the Agent or any Lender or any other Person,
whether in connection with this Agreement, the transactions contemplated herein
or any unrelated transaction (including any, underlying transaction between the
Borrower and the beneficiary for which any Letter of Credit was procured);
(v) any draft, demand, certificate or other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect even if the Agent has been notified thereof;
(vi) payment by the Agent under any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit;
(vii) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or prospects of the
Borrower;
(viii) any breach of this Agreement or any other Loan Document
by any party thereto;
(ix) the occurrence or continuance of any proceeding described
in Section 7.3 with respect to the Borrower;
(x) the fact that an Event of Default shall have occurred and
be continuing;
(xi) the fact that the Termination Date shall have passed or
this Agreement or the Revolving Credit Commitments hereunder shall have been
terminated; and
(xii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing.
- 28 -
2.6i INDEMNITY. In addition to amounts payable as provided in Section 9.16, the
Borrower hereby, agrees to protect, indemnify, pay and save harmless the Agent
from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable fees, expenses and
disbursements of counsel and allocated costs of internal counsel) which the
Agent may incur or be subject to as a consequence, direct or indirect, of (i)
the issuance of any Letter of Credit, other than as a result of (A) gross
negligence or willful misconduct of the Agent as determined by a final judgment
of a court of competent jurisdiction or (B) subject to the following clause
(ii), the wrongful dishonor by the Agent of a proper demand for payment made
under any Letter of Credit, or (ii) the failure of the Agent to honor a drawing
under any such Letter of Credit as a result of any act or omission, whether
rightful or wrongful, of any present or future de jure or de facto Governmental
Authority (all such acts or omissions herein called "Governmental Acts").
2.6j LIABILITY FOR ACTS AND OMISSIONS. As between the Borrower and the Agent,
the Borrower assumes all risks of the acts and omission of, or misuse of the
Letters of Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, the Agent shall not be
responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any party in connection with the
application for an issuance of any such Letter of Credit, even if it should in
fact prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent or forged; (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any such Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (iii) the
failure of the beneficiary of any such Letter of Credit, or any other party, to
which such Letter of Credit may be transferred, to comply fully with any
conditions required in order to draw upon such Letter of Credit so long as the
documents presented in connection with such draw appear on their face to
substantially comply with the terms and conditions of the relevant Letter of
Credit; (iv) any claim of the Borrower against any beneficiary of any such
Letter of Credit, or any transferee of such Letter of Credit, or any dispute
between or among the Borrower and any beneficiary of any Letter of Credit or any
such transferee; (v) errors, omissions, interruptions or delays in transmission
or delivery of any messages, by mail, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (vi) errors in interpretation of technical
terms; (vii) any loss or delay in the transmission or otherwise of any document
required in order to make a drawing under any such Letter of Credit or of the
proceeds thereof; (viii) the misapplication by the beneficiary of any such
Letter of Credit of the proceeds of any drawing under such Letter of Credit; or
(ix) any consequences arising from causes beyond the control of the Agent,
including any Governmental Acts, and none of the above shall affect or impair,
or prevent the vesting of, any of the Agent's rights or powers hereunder.
Nothing in the preceding sentence shall relieve the Agent from liability for the
Agent's gross negligence or willful misconduct in connection with actions or
omissions described in such clauses (i) through (ix) of such sentence.
2.6k UNIFORM CUSTOMS. Except and to the extent inconsistent with the specific
provisions hereof, this Agreement, each Letter of Credit hereunder and all
transactions in connection therewith shall be interpreted, construed and
enforced according to: (i) the "Uniform Customs and Practice for Documentary
Credits" (1993 Revision), International Chamber of Commerce Publication No. 500
or the "International Standby Practices 1998," International Chamber of
- 29 -
Commerce Publication No. 590, as applicable, and in each case subsequent
revisions thereof, which shall supersede inconsistent provisions of applicable
law to the extent not prohibited by applicable law and (ii) the laws of the
jurisdiction in which the office of the Agent is located for purposes of issuing
Letters of Credit hereunder including, without limitation, the Uniform
Commercial Code, excluding conflict of laws rules.
2.7 SUBSTITUTION OR REPLACEMENT OF A LENDER. The Borrower shall have the right
(provided that at such time, no Event of Default and no Potential Default has
occurred and is continuing), in its sole discretion, to either:
(i) repay, (A) at any time if either no Revolving Credit Loans are
outstanding or if Revolving Credit Loans bearing interest under the Base
Rate Option are the only Revolving Credit Loans outstanding, (B) subject
to Section 2.9, upon three (3) days prior notice if the Revolving Credit
Loans outstanding include Revolving Credit Loans bearing interest under
the Euro-Rate Option, the outstanding Revolving Credit Loans of any Lender
in whole, together with interest thereon and any other fees, expenses or
other sums payable to such Lender pursuant to the terms of this Agreement,
all whether then due and payable or accrued and unpaid, and to terminate
the Revolving Credit Commitment of such Lender; or
(ii) seek a substitute lending institution or institutions (which
may be one or more of the other Lenders) to purchase the Revolving Credit
Note and assume the Revolving Credit Loans, the Revolving Credit
Commitment and the other obligations of such Lender under this Agreement,
if any of the following conditions occur with respect to such Lender:
(i) such Lender shall have delivered a notice or certificate
pursuant to Subsection 2.3a or 2.3b;
(ii) the obligation of such Lender to make or renew Revolving Credit
Loans which bear or are to bear interest under the Euro-Rate Option has
been suspended pursuant to Subsection 2.3d; or
(iii) such Lender shall have defaulted under Section 9.4 or failed
to fund a Disbursement;
provided, any proposed substitute lending institution, which is not a Lender
prior to the Borrower's selection thereof, must be acceptable to the Agent,
whose consent shall not be unreasonably withheld or delayed, and provided,
further that all of the provisions of Section 9.6 (with respect to any Lender)
and Section 8.11 (if the affected Lender is the Agent) must be complied with.
2.8 LOAN REPAYMENT AND PREPAYMENT.
2.8a VOLUNTARY PREPAYMENTS. Each repayment of the Revolving Credit Loans shall
be in the minimum amount of $1,000,000, in the aggregate, or, in excess thereof,
in an integral multiple of
- 30 -
$100,000 thereof, or such lesser amount as is actually outstanding thereunder.
The Borrower, upon (i) oral or written notice to Agent by 11:00 A.M. (eastern
time) on the day of the proposed repayment, in the case of Revolving Credit
Loans bearing interest at the Base Rate or (ii) three (3) Business Days' prior
oral or written notice to the Agent, in the case of Revolving Credit Loans
bearing interest at the Adjusted Euro-Rate, followed immediately thereafter by
the Borrower's written confirmation to the Agent of any oral notice, may repay
the outstanding amount of the Revolving Credit Loans in whole or in part with
accrued interest, fees and other amounts then due and payable on the amount
repaid to the date of such repayment, subject to the payment of any additional
amounts under Section 2.9 below. The Borrower may prepay any Portion of the
Revolving Credit Loans without premium or penalty subject to Section 2.9. The
Borrower shall notify the Agent whether any such repayment applies to General
Revolving Loans or Distribution Loans. If no such notice is given, such
repayment shall be deemed to be first a repayment of Distribution Loans and
second a repayment of General Revolving Loans.
Subject to Section 5.7, any repayment of the Revolving Credit Loans shall
increase, by the amount of that repayment, the unborrowed balance of the
Revolving Credit Commitments; it being contemplated that the Borrower may repay
and reborrow from time-to-time under the Revolving Credit Commitments until the
Termination Date.
2.8b SCHEDULED REPAYMENT. All Revolving Credit Loans outstanding on the
Termination Date shall become due and payable in full on such date.
2.9 ADDITIONAL PAYMENTS BY THE BORROWER. If (i) the Borrower shall fail to make
any payment due hereunder on the due date thereof, (ii) the Borrower shall make
a payment, prepayment or conversion of any Euro-Rate Portion of the Revolving
Credit Loans on a day other than the last day of the applicable Interest Period,
or (iii) the Borrower shall fail on the date specified therefor to consummate
any borrowing, conversion or renewal after giving a request for a Disbursement
or notice of conversion or renewal, and, as a result of any such action or
inaction, a Lender reasonably incurs any losses and expenses which it would not
have incurred but for such action or inaction, the Borrower shall pay such
additional amounts as will compensate the affected Lender for such losses and
expenses, including the cost of reemployment of any funds prepaid at rates lower
than the cost to the affected Lender of such funds. Such losses and expenses,
which the affected Lender shall exercise reasonable efforts to minimize, shall
be specified in writing (setting forth, in reasonable detail, the basis of
calculation) to the Borrower by the affected Lender, which writing shall be
prima facie evidence of the amounts set forth therein, and such amounts shall be
payable within thirty (30) days of demand therefor.
2.10 CHANGES OF COMMITMENTS; VOLUNTARY REDUCTION OF AVAILABILITY . At any time
and from time to time upon no less than five (5) Business Day's prior written
notice to the Agent, the Borrower may terminate, in whole or in part, without
penalty, the then unused portion of the Revolving Credit Commitments, thereby
causing a corresponding abatement of the Commitment Fee; provided, however, that
the Borrower may not terminate an unused portion of the Revolving Credit
Commitments such that the aggregate Revolving Credit Commitments are reduced
below the Letters of Credit Outstanding. Each such reduction shall be in a
minimum principal amount of $1,000,000 or in integral multiples thereof. Notice
of termination once given shall be
- 31 -
irrevocable and the portion of the Revolving Credit Commitments so terminated
shall not be available for borrowing once such notice has been given under the
terms hereof. The Agent shall promptly notify each Lender of its pro rata share
of such terminated unused portion and the date of each such termination.
2.11 LOAN ACCOUNT. The Agent shall open and maintain on its books a Loan Account
in the name of the Borrower, with respect to (i) the amounts and types of
Disbursements made, repayments and prepayments of the principal thereof, and the
computation and payment of interest thereon, (ii) Letters of Credit issued, or
participated in, as the case may be, and draws and reimbursements thereon or
thereof, (iii) the computation and payment of the Fees due hereunder to the
Lenders and the Agent, and (iv) the computation of other amounts due and sums
paid and payable to the Lenders and the Agent hereunder. The Loan Account shall
be prima facie evidence as to the amount at any time due to the Lenders and the
Agent from the Borrower hereunder; provided, however, that the failure to make
notations, or to make accurate notations, on such Loan Account including without
limitation notations with respect to interest and Fees pursuant to Section 2.5
or otherwise shall not limit, expand or otherwise affect any obligations of the
Borrower hereunder.
2.12 PAYMENT FROM ACCOUNTS MAINTAINED BY BORROWER. In the event that any payment
of principal, interest, Fees or any other amount due to the Lenders or the Agent
under the Agreement, the Revolving Credit Notes or the other Loan Documents is
not paid when due, the Agent is hereby authorized to effect such payment by
debiting any demand deposit account of the Borrower maintained with the Agent
(excluding however any special purpose fiduciary accounts, which are designated
as such at the time of their creation, or mandated by applicable statutes,
regulations or rules) and distributing such payment to the party to whom such
amounts are due. The Agent shall provide prompt notice to the Borrower
subsequent to any exercise of its right to debit accounts of the Borrower to
effect such payments. This right of debiting accounts of the Borrower is in
addition to any right of set-off accorded the Lenders or the Agent hereunder or
by operation of law.
2.13 TIME, PLACE AND MANNER OF PAYMENTS. All payments and prepayments to be made
by the Borrower in respect of principal, interest or other costs relating to the
Revolving Credit Loans, Reimbursement Obligations and all Fees and any other
amounts due hereunder (excepting those amounts due under Sections 2.3 and 2.9
hereof) shall be made at the principal office of the Agent for the ratable
account of the Lenders or the Agent, as the case may be. The Agent will promptly
pay each such payment received to each Lender or its order in accordance with
Section 8.9 hereof. All payments due a Lender by reason of Sections 2.3 or 2.9
hereof shall be paid at the principal office of the Lender which invoices the
Borrower for such payment. All payments to be made by the Borrower under this
Agreement shall be paid in Dollars and in immediately available funds no later
than 12:00 noon (eastern time) on the date such payment is due, without
presentment, demand, protest or notice of any kind, all of which are hereby
expressly waived by the Borrower, and without setoff, counterclaim or other
deduction of any nature. Notwithstanding anything herein to the contrary, (i)
the Agent's Fee, (ii) the Fronting Fee, and (iii) any interest paid with respect
to any Revolving Credit Loan or any unreimbursed draw on the Letter of Credit to
the extent a Lender has not been required to honor or has not honored its
funding obligation with respect thereto shall be solely for the account of the
Agent.
- 32 -
2.14 GUARANTY. To secure the repayment of the Bank Indebtedness, each of the
Guarantors shall execute and deliver to the Agent for the benefit of the Lenders
a Guaranty Agreement substantially in the form of Exhibit "D-1 or "D-2" attached
hereto, as applicable, (i) on the Closing Date in the case of each Guarantor in
existence on such date, and (ii) within ten (10) days after the formation or
acquisition of any entity which meets the definition of a Guarantor.
3. REPRESENTATIONS AND WARRANTIES.
To induce the Agent and the Lenders to enter into this Agreement and
to make the Revolving Credit Loans, and to issue, renew or extend the Letters of
Credit, as herein provided for, the Borrower represents and warrants to the
Agent and the Lenders that:
3.1 EXISTENCE. Each Loan Party, and each general partner or managing member of
each Loan Party, is a corporation, limited partnership or limited liability
company, as the case may be, duly organized, validly existing and in good
standing under the laws of its respective jurisdiction of organization or
formation, and it is duly qualified and in good standing as a foreign
corporation, limited partnership or limited liability company, as the case may
be, authorized to do business in each jurisdiction where, because of the nature
of its respective properties or businesses, such qualification is required or,
if not so qualified or in good standing in any state, the lack of such
qualification or good standing could not reasonably be expected to result in a
Material Adverse Change.
3.2 CAPITALIZATION: OWNERSHIP. The Parent is the sole member of the Borrower.
The issued and outstanding securities of the Parent as of the Closing Date
consist of approximately 12,005,000 common units of limited partnership interest
and approximately 12,005,000 subordinated units of limited partnership interest,
all of which have been validly issued and are fully, paid and nonassessable, and
the general partnership interests held by the General Partner. The General
Partner is the sole general partner of the Parent and owned as described on
Schedule 3.2.
3.3 SUBSIDIARIES AND OTHER INVESTMENTS. On the Closing Date, neither the Parent
nor the Borrower has any Subsidiaries or any direct or indirect ownership
interests in any other Person, except as set forth on Schedule 3.3. The Parent,
the Borrower, and each Subsidiary of the Borrower, has good and marketable title
to all the securities of the Subsidiaries issued to it, free and clear of all
liens and encumbrances and all such securities have been duly and validly issued
and are fully paid and nonassessable. The authorized securities of such
Subsidiaries and the ownership thereof, in each case on the Closing Date, are as
shown on Schedule 3.3 attached hereto.
3.4 CORPORATE AUTHORITY. Each Loan Party is duly authorized to execute and
deliver this Agreement, the Revolving Credit Notes and the other Loan Documents
to which it is or will become a party; all necessary corporate, partnership or
limited liability company action necessary to authorize the execution and
delivery of this Agreement, the Revolving Credit Notes and the other Loan
Documents to which it is or will become a party has been properly taken; the
Borrower is and will continue to be duly authorized to borrow hereunder; and
each Loan Party is and will continue to be duly authorized to perform all of the
other terms and provisions of this
- 33 -
Agreement, the Revolving Credit Notes and the other Loan Documents to which it
is or will become a party.
3.5 ENFORCEABILITY. This Agreement, the Revolving Credit Notes, and each other
Loan Document has been, and will be, duly and validly executed and delivered by
each Loan Party which is or will become a party thereto, and each constitutes or
will constitute a valid and legally binding agreement of such Loan Party
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, or other laws affecting creditor's
rights generally and subject to general principles of equity, regardless of
whether considered in a proceeding in equity or at law.
3.6 NO RESTRICTIONS, NO DEFAULT. Neither the execution and delivery of this
Agreement, the Revolving Credit Notes and the other Loan Documents to which it
is or will become a party, the consummation of the transactions herein
contemplated nor compliance with the terms and provisions hereof or of the
Revolving Credit Notes or any other Loan Document, will conflict with or result
in a breach of any of the terms, conditions or provisions of the certificate of
incorporation, by-laws, partnership agreement, operating agreement or other
organizational, formation or governing document of any Loan Party or of any law
or of any regulation, order, writ, injunction or decree of any court or
governmental agency or of any agreement, indenture or other instrument to which
any Loan Party is a party or by which any of them is bound or to which any of
them is subject, or constitute a default thereunder or result in the creation or
imposition of any Encumbrance of any nature whatsoever upon any of the property
or assets of any Loan Party pursuant to the terms of any agreement, indenture or
other instrument, except those items described above that, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Change. No event has occurred and is continuing and no condition exists or will
exist after giving effect to the borrowings hereunder to be made on the Closing
Date which constitutes an Event of Default or Potential Default.
3.7 FINANCIAL MATTERS.
3.7a FINANCIAL STATEMENTS. The Borrower has furnished, or caused to be
furnished, to the Lenders and the Agent (i) the audited balance sheets as of
December 31, 2000 and 2001 and the related statements of income, changes in
partners' capital or stockholders' equity, as the case may be, and cash flows
for the three (3) Fiscal Years ending December 31, 2001 for each of Western
Pocahontas Properties Limited Partnership, Great Northern Properties Limited
Partnership, and New Gauley Coal Corporation, (ii) the audited balance sheets as
of December 31, 2000 and 2001 and the related statements of revenues and direct
costs and expenses for each of the three (3) Fiscal Years ending December 31,
2001 for Arch Coal, Inc., Contributed Properties (as defined in such financial
statements) (each of the entities described in clause (i) and (ii) above are
referred to as a "Contributor" and collectively as the "Contributors") and (iii)
the unaudited balance sheet and other financial information of the Contributors
through June 30, 2002 as set forth in the Form S-1. All such financial
statements, including the related notes, have been prepared in accordance with
GAAP, except as expressly noted therein, and fairly present the financial
position of the respective Contributors as of the dates thereof and the results
of the respective Contributor's operations and the changes in financial position
for the periods ended on such dates. There were no material liabilities of the
respective Contributors, contingent or
- 34 -
otherwise, not reflected in such financial statements. Except as has been fully
disclosed in writing to the Lenders and the Agent prior to the date hereof
(including the formation of the Parent and the completion of the Transaction),
there has been no Material Adverse Change in the assets, leases, properties,
business, condition or operations (financial or otherwise) of the respective
Contributors since December 31, 2001.
3.7b PRO FORMA FINANCIALS. The Borrower has delivered, or caused to be
delivered, to the Lenders and the Agent (i) an unaudited pro forma balance sheet
for the Parent as of June 30, 2002 which is set forth in the Form S-1 (as in
effect on the Closing Date) and giving effect to the Transaction and (ii) its
projections through December 31, 2006. Such pro forma balance sheet is complete
and correct in all material respects and fairly presents the financial condition
of the Parent and its Subsidiaries, on a Consolidated basis, in all material
respects, and has been prepared in accordance with GAAP (except that such
financial statements do not contain all of the footnote disclosures required by
GAAP). The Parent and its Subsidiaries have no material liabilities, whether
direct or indirect, fixed or contingent, and no liability for taxes, long-term
leases or unusual forward or long-term commitments as of the date of such
financial statements which are not reflected in such financial statements or in
any notes thereto or in such projections.
3.8 ABSENCE OF LITIGATION. Except as described in the Form S-1, there are no
actions, suits, investigations, litigation or governmental proceedings pending
or, to the Borrower's knowledge, threatened against the Parent or any Subsidiary
of the Parent or any of their respective properties, which could reasonably be
expected to result in a Material Adverse Change, or which purport to affect the
legality, validity or enforceability of this Agreement, the Revolving Credit
Notes or any other Loan Document.
3.9 TAX RETURNS AND PAYMENTS. As of the date hereof, the Parent and its
Subsidiaries have filed all Federal and other material tax returns required by
law to be filed and have paid all material taxes, material assessments and other
material governmental charges levied upon the Parent and its Subsidiaries taken
as a whole, or any of the respective properties, assets, income or franchises of
the Parent and its Subsidiaries taken as a whole, which are due and payable,
other than those currently payable or deferrable without penalty or interest or
those which are being contested in good faith and by appropriate proceedings
diligently conducted for which reserves in accordance with GAAP have been
provided. As of the date hereof, the charges, accruals and reserves on the books
of the Parent and its Subsidiaries in respect of Federal, state and local income
taxes for all fiscal periods are adequate, and the Borrower knows of no unpaid
assessments for additional Federal, state or local income taxes for any such
fiscal period or any basis therefor.
3.10 PENSION PLANS. (i) Each Plan has been and will be maintained and funded, in
all material respects, in accordance with its terms and with all provisions of
ERISA and the Code applicable, thereto; (ii) no Reportable Event has occurred
and is continuing with respect to any Plan; (iii) no liability to PBGC has been
incurred with respect to any Plan, other than for premiums due and payable; (iv)
no Plan has been terminated, no proceedings have been instituted to terminate
any Plan, and there exists no intent to terminate or institute proceedings to
terminate any Plan, which has caused or would cause the Borrower or any ERISA
Affiliate to incur any liability to the PBGC under Title IV of ERISA which could
reasonably be expected to result in a Material
- 35 -
Adverse Change; (v) no withdrawal, either complete or partial, has occurred or
commenced with respect to any Multiemployer Plan, and there exists no intent to
withdraw either completely or partially from any Multiemployer Plan where such
withdrawal could reasonably be expected to result in a Material Adverse Change
and (vi) the Borrower is not subject to any liability for unpaid penalties or
taxes imposed under Section 502(i) of ERISA or Section 4975 of the Code and has
not engaged in a prohibited transaction as defined in Section 406 of ERISA and
Section 4975 of the Code.
3.11 FISCAL YEAR. The Fiscal Year of the Parent and the Borrower ends on
December 31 of each year.
3.12 CONDITION OF AND TITLE TO ASSETS. The Borrower and each of its Subsidiaries
has good title to its properties and assets except for Permitted Encumbrances
and defects in title which, taken as a whole, are not material. None of the
assets of the Borrower or any Subsidiary of the Borrower is subject to any
Encumbrances except for Permitted Encumbrances. All material assets and
properties of the Borrower and its Subsidiaries that are necessary for the
operation of their respective businesses are in good working condition in
accordance with industry standards, ordinary wear and tear excepted, and are
able to serve the functions for which they are currently being used.
3.13 INSURANCE. The Borrower and its Subsidiaries currently maintain insurance
of such types and at least in such amounts as are customarily carried by, and
insures against such risks as are customarily insured against by similar
businesses similarly situated and owning, leasing and operating similar
properties to those owned, leased and operated by the Borrower and its
Subsidiaries. All of such insurance policies are valid and in full force and
effect. No notice has been given or claim made and no grounds exist to cancel or
avoid any, of such policies or to reduce the coverage provided thereby.
3.14 LABOR AND EMPLOYMENT MATTERS. Neither the Borrower nor any Subsidiary of
the Borrower is a party to any collective bargaining agreement.
3.15 COMPLIANCE WITH APPLICABLE LAWS. The Borrower and each Subsidiary (i) is
not in default with respect to any order, writ, injunction or decree of any
court or of any Federal, state, municipal or other Governmental Authority and
(ii) is substantially complying with all applicable statutes and regulations of
each Governmental Authority having jurisdiction over its activities; except for
those orders, writs, injunctions, decrees, statutes and regulations, default
under or non-compliance with which, individually or collectively, could not
reasonably be expected to result in a Material Adverse Change.
3.16 ENVIRONMENTAL MATTERS. Except as described in the Form S-1, the Borrower
and its Subsidiaries are in material compliance with all applicable
Environmental Laws. Except for any of the following that could not reasonably be
expected to result in a Material Adverse Change, there are no past, pending or,
to the best of the Borrower's knowledge, threatened Environmental Claims of any
material respect against the Borrower or its Subsidiaries or any of the property
of the Borrower or any of its Subsidiaries, and there is no condition or
occurrence on any property owned or leased by the Borrower or any of its
Subsidiaries, to the knowledge of the Borrower,
- 36 -
that could reasonably be anticipated (i) to form the basis of a material
Environmental Claim against the Borrower, such Subsidiary or its properties or
(ii) to cause any property owned or leased by the Borrower or any such
Subsidiary to be subject to any material restrictions on its ownership,
occupancy or transferability under any applicable Environmental Law.
3.17 CONSENTS AND APPROVALS. No order, authorization, consent, license,
validation or approval of, or notice to, filing, recording, or registration
with, any Governmental Authority or any other Person, or exemption by any
Governmental Authority, is required to authorize, or is required in connection
with, (i) the execution, delivery and performance of this Agreement, the
Revolving Credit Notes or any other Loan Document, (ii) the legality, binding
effect or enforceability of this Agreement, the Revolving Credit Notes or any
other Loan Document or (iii) the consummation of the Transaction, which has not
been duly obtained and which is not in full force and effect (unless the failure
to obtain any of the same could not reasonably be expected, individually or
collectively, to result in a Material Adverse Change).
3.18 REGULATIONS T, U AND X. The Borrower is not engaged in the business of
purchasing or selling Margin Stock or extending credit to others for the purpose
of purchasing or carrying Margin Stock and no part of the proceeds of the
Revolving Credit Loans will be used to purchase or carry any Margin Stock or for
any other purpose which would violate or be inconsistent with Regulations T, U
or X.
3.19 INVESTMENT COMPANY ACT. The Borrower is not an "investment company", or a
company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended.
3.20 PUBLIC UTILITY HOLDING COMPANY ACT. The Borrower is not a "holding
company", or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
3.21 SENIOR DEBT STATUS. On the Closing Date and on the date of each
Disbursement and the issuance of each Letter of Credit, all Bank Indebtedness
outstanding under the Loan Documents will constitute senior Indebtedness of the
Borrower and will rank at least pari passu in priority of payment with all other
Indebtedness owed by the Borrower from time to time, except Indebtedness of the
Borrower which may be secured by Encumbrances permitted pursuant to Section 5.2.
3.22 INTELLECTUAL PROPERTY. The Borrower and each Subsidiary of the Borrower
owns, is licensed or otherwise possesses the right to use all patents, patent
rights, trademarks, trade names, service marks, copyrights, intellectual
property, technology, know-how and processes necessary for the conduct of its
business as currently conducted that are material to the condition (financial or
otherwise), business or operations of the Borrower and its Subsidiaries.
3.23 LEASES. All Leases in effect on the Closing Date are listed on Schedule
3.23 attached hereto. Each such Lease is in full force and effect and there is
no default thereunder and no event has occurred or is occurring which after
notice or lapse of time or both will result in such
- 37 -
default, except for defaults which could not reasonably be expected to result in
a Material Adverse Change. Prior to the Closing Date, the Borrower has made
available to the Agent a true, correct and complete copy of each of the Leases.
Each lessee under the Coal Leases is paying royalties currently due under its
respective Coal Lease directly to Borrower and, with the exception of payment of
the minimum royalties required thereunder, lessee has not prepaid any sums
payable by any lessee under any of the Coal Leases. To the Borrower's knowledge,
no material amount of royalties are currently past due under any of the Leases.
There is no consent or approval required under any Lease with respect to this
Agreement or the consummation of the Transaction which has not been obtained.
3.24 SOLVENCY. On the Closing Date, and as of the date of each advance of a
Revolving Credit Loan or the issuance, renewal or extension of any Letter of
Credit, as the case may be, and after giving effect to such advance or the
issuance, renewal or extension of a Letter of Credit, and after giving effect to
the consummation of the transactions contemplated by this Agreement (including
the Transaction), the Borrower is, and will be (individually and together with
its Subsidiaries), Solvent.
3.25 TAX TREATMENT. The Parent will be treated as a partnership for federal
income tax purposes.
3.26 DISCLOSURE. Neither this Agreement nor any other document, certificate or
statement furnished to the Lenders or the Agent by or on behalf of any Loan
Party pursuant to this Agreement contains any untrue statement of a material
fact. There is no fact known to any Loan Party which could reasonably be
expected to result in a Material Adverse Change that has not been set forth in
this Agreement or in the other documents, certificates and statements (financial
or otherwise) furnished to the Lenders or the Agent or otherwise disclosed in
writing to the Lenders or the Agent by or on behalf of any Loan Party prior to
or on the date hereof.
3.27 TRANSACTIONS WITH AFFILIATES. Except as set forth in Schedule 3.27 or as
permitted in Section 5.16 herein, there are no loans, leases, royalty agreements
or other agreements, arrangements or other transactions between any Loan Party
and any Affiliate, including between Loan Parties.
4. AFFIRMATIVE COVENANTS.
From the date hereof and thereafter until the termination of the Revolving
Credit Commitments and until all of the Bank Indebtedness is paid in full, the
Borrower agrees that:
4.1 USE OF PROCEEDS. (i) The proceeds of the General Revolving Loans will be
used by the Borrower solely for general corporate, limited liability company or
partnership purposes of the Borrower and its Subsidiaries, including for working
capital, capital expenditures and for Permitted Acquisitions, but will not be
used to fund any Restricted Payment. (ii) The proceeds of the Distribution Loans
will be used by the Borrower solely for funding Quarterly Distributions by the
Parent to the extent permitted by Section 5.1. (iii) The Letters of Credit will
be used for general business purposes in the ordinary course of business or for
such other purposes as may be approved by the Required Lenders.
- 38 -
4.2 FURNISHING INFORMATION. The Borrower shall:
(i) deliver (or cause to be delivered) to the Agent in electronic
format or hard copy (with copies for each Lender which Agent shall
promptly distribute to each Lender) within sixty (60) days after the end
of each of the first three (3) Fiscal Quarters in each Fiscal Year of the
Parent, the Parent's Form 10-Q filed with the Securities and Exchange
Commission, together with (A) consolidated balance sheet as at the end of
such period for the Parent and its Subsidiaries, (B) consolidated
statements of income for such period for the Parent and its Subsidiaries
and, in the case of the second and third quarterly periods, for the period
from the beginning of the current Fiscal Year to the end of such quarterly
period, and (C) consolidated statements of cash flow for such period for
the Parent and its Subsidiaries and, in the case of the second and third
quarterly periods, for the period from the beginning of the current Fiscal
Year to the end of such quarterly period; and each such statement shall
set forth, in comparative form, corresponding figures for the
corresponding period in the immediately preceding Fiscal Year; and all
such statements shall be prepared in reasonable detail in accordance with
GAAP and certified, subject to changes resulting from year-end adjustments
and the absence of footnotes, by the chief financial officer or treasurer
of the Parent;
(ii) deliver (or cause to be delivered) to the Agent in electronic
format or hard copy (with copies for each Lender which Agent shall
promptly distribute to each Lender) within one hundred twenty (120) days
after the end of each Fiscal Year of the Parent, the Parent's Form 10-K
filed with the Securities and Exchange Commission, together with (A)
consolidated balance sheets as at the end of such year for the Parent and
its Subsidiaries, (B) consolidated statements of income for such year for
the Parent and its Subsidiaries, (C) consolidated statements of cash flow
for such year for the Parent and its Subsidiaries, and (D) consolidated
statements of owners' equity for such year for the Parent and its
Subsidiaries; and each such statement shall set forth, in comparative
form, corresponding figures for the immediately preceding Fiscal Year; and
all such financial statements shall present fairly in all material
respects the financial position of the Parent and its consolidated
Subsidiaries, as at the dates indicated and the results of its operations
and its cash flow for the periods indicated, in conformity with GAAP; and
the Borrower shall cause each of the consolidated financial statements
described in the foregoing clauses (A) through (D) to be certified without
limitation as to scope or material qualification by nationally-recognized
independent certified public accountants;
(iii) deliver to the Agent in electronic format or hard copy (with
copies for each Lender which Agent shall promptly distribute to each
Lender), together with each delivery of financial statements pursuant to
items (i) and (ii) above, a Compliance Certificate of the Parent and the
Borrower substantially in the form of Exhibit "C" hereto, properly
completed and signed by an Authorized Officer of the Borrower and the
Parent, (A) stating (1) that such officer has reviewed the terms of the
Loan Documents and has made, or caused to be made under his supervision, a
review of the transactions and condition of the Parent and its
Subsidiaries during the accounting period covered by such financial
statements and that such review has not disclosed the existence during
such accounting period, (2) that neither the Parent nor the Borrower has
knowledge of the
- 39 -
existence, as at the date of such Compliance Certificate, of any condition
or event which constitutes an Event of Default or a Potential Default, or,
if any such condition or event existed or exists, specifying the nature
and period of existence thereof and what action the Borrower has taken or
is taking or proposes to take with respect thereto and (3) that the
insurance required to be maintained by the Borrower and its Subsidiaries
by Section 4.7 hereof is in force and is adequate in nature and amount,
and (B) demonstrating in reasonable detail compliance as at the end of
such accounting period with the covenants contained in Section 5.3 hereof;
(iv) promptly give electronic or written notice to the Agent (a copy
of which Agent shall promptly distribute to each Lender) of any pending
or, to the knowledge of the Borrower, overtly threatened claim in writing,
litigation or threat of litigation which arises between the Parent, the
General Partner, the Borrower, or any of its Subsidiaries, and any other
party or parties (including, without limitation, any Governmental
Authority) which claim, litigation or threat of litigation, individually
or in the aggregate, is reasonably likely to result in a Material Adverse
Change, any such notice to be given not later than five (5) Business Days
after the Borrower becomes aware of the occurrence of any such claim,
litigation or threat of litigation and has ascertained it is reasonably
likely to result in Material Adverse Change;
(v) deliver (or cause to be delivered) to the Agent in electronic
format or hard copy (with copies for each Lender which Agent shall
promptly distribute to each Lender) promptly upon their becoming
available, copies of all financial statements, reports, notices and
information statements sent or made available generally by the Parent to
its security holders (including, without limitation, proxy materials) and
copies of all other regular and periodic reports (including, without
limitation, Form 8-K) filed by the Parent with the Securities and Exchange
Commission or any Governmental Authority succeeding to any of its
functions, and of all press releases and other statements made available
generally by the Parent to the public concerning material developments in
the business of the Parent and any of its Subsidiaries taken as a whole;
(vi) promptly after receipt thereof by the Borrower or the
administrator of any Plan, deliver to the Agent a copy of any notice (a
copy of which Agent shall promptly distribute to each Lender) from the
PBGC that the PBGC is instituting Termination Proceedings if such
Termination Proceedings could reasonably be expected to result in a
Material Adverse Change;
(vii) promptly after the underlying material information is made
available to the public, but in no event later than sixty (60) days
following the end of each Fiscal Quarter of the Parent, deliver (or cause
to be delivered) to the Agent in electronic format or hard copy (with
copies for each Lender which Agent shall promptly distribute to each
Lender), a report of Available Cash, cash reserves and other related items
of the Parent and its Subsidiaries as of the end of the immediately
preceding Fiscal Quarter in form and substance satisfactory to the Agent;
- 40 -
(viii) promptly and in any event within thirty (30) days after the
Borrower or the administrator of any Plan knows or has reason to know that
any Reportable Event has occurred which would cause the PBGC to institute
Termination Proceedings, give notice thereof (a copy of which Agent shall
promptly distribute to each Lender) to the Agent if such Termination
Proceedings could reasonably be expected to result in a Material Adverse
Change;
(ix) promptly, but not later than five (5) Business Days after any
officer obtains knowledge of the happening of any event which constitutes
an Event of Default or a Potential Default, give written notice, either in
electronic format or hard copy, thereof to the Agent (a copy of which
Agent shall promptly distribute to each Lender);
(x) deliver to the Agent in electronic format or hard copy (with
copies for each Lender which Agent shall promptly distribute to each
Lender) within one hundred twenty (120) days following the end of each
Fiscal Year of the Borrower, an operational report in form and substance
satisfactory to the Agent, showing (A) five-year projections, (B) tons of
coal mined and sold by lessee, including actual tons mined and sold
compared to the previous Fiscal Year and to budget, (C) royalty income by
lessee, and, upon the reasonable request of the Agent, (D) a coal reserve
summary and (E) a lease summary, including individual lease profiles and
lease property maps;
(xi) in the event the Borrower or any of its Subsidiaries gives to
or receives notice from any Governmental Authority of any Contamination or
receives any Environmental Claim from any Person, including any state
agency responsible in whole or in part for environmental matters in the
state in which its properties are located or the United States
Environmental Protection Agency which in either case could reasonably be
expected to result in a Material Adverse Change, then Borrower shall,
within five (5) Business Days, give written notice, either in electronic
format or hard copy, of same to the Agent (a copy of which Agent shall
promptly distribute to each Lender) detailing non-privileged and
non-confidential facts and circumstances giving rise to the Contamination
or Environmental Claim. Such information is to be provided to allow the
Agent and the Lenders to protect their interests hereunder and is not
intended to create any obligation upon the Agent or any Lender with
respect thereto;
(xii) promptly after receipt thereof, deliver to the Agent copies,
either in electronic format or hard copy for each Lender which Agent shall
promptly distribute to each Lender, of any statement or report regarding
the rating of the Parent's or the Borrower's debt furnished by any rating
agency to any Loan Party;
(xiii) promptly, but not later than five (5) Business Days after any
sale, transfer or disposition of assets permitted by Section 5.7(iv),
deliver to the Agent written notice, either in electronic format or hard
copy, of such transaction, including the amount of proceeds (a copy of
which Agent shall promptly distribute to each Lender); and
(xiv) promptly, deliver to the Lenders such other publicly available
information and data with respect to the Parent, the Borrower or any of
its Subsidiaries as from time
- 41 -
to time may be reasonably requested by any Lender. Each document or
certificate provided by the Borrower under this Section in electronic
format shall for all intents and purposes be treated as an original
version of the same document, all as if delivered in hard copy with an
original signature appended thereto.
4.3 VISITATION. The Borrower will permit, and will cause each of its
Subsidiaries to permit, the Lenders and the Lenders' designated employees and
agents to have access, from time to time, and, prior to the occurrence of an
Event of Default, upon reasonable notice and during normal business hours at
reasonable intervals, to visit any of the properties of the Borrower or any such
Subsidiary, to examine and make copies of any of its books of record and account
and such reports and returns as the Borrower or any such Subsidiary may file
with any Governmental Authority and discuss the Borrower's or any such
Subsidiary's affairs and accounts with, and be advised about them, by any
Authorized Officer.
4.4 PRESERVATION OF EXISTENCE; QUALIFICATION. At its own cost and expense, the
Borrower will do all things necessary to preserve and keep in full force and
effect its and each of its Subsidiaries' corporate, partnership or limited
liability company existence and qualification under the laws of their respective
states of organization and each state where, due to the nature of their
respective activities or the ownership of their respective properties,
qualification to do business is required except where (i) the lack of corporate,
partnership or limited liability company existence of a Subsidiary, or (ii) the
failure to be so qualified, could not reasonably be expected to result in a
Material Adverse Change or except as permitted by Sections 5.8 and 7.4.
4.5 COMPLIANCE WITH LAWS AND CONTRACTS. The Borrower shall and shall cause each
Subsidiary to comply with all applicable Governmental Rules including, but not
limited to, Environmental Laws, except where failure to comply, individually or
in the aggregate, could not reasonably be expected to result in a Material
Adverse Change.
4.6 PAYMENT OF TAXES AND OTHER LIABILITIES. The Borrower shall and shall cause
each Subsidiary to promptly pay and discharge all obligations, accounts and
liabilities to which it is subject or which are asserted against it and which
obligations, accounts and liabilities are, to the Borrower and the Subsidiaries
taken as a whole, material, including but not limited to all taxes, assessments
and governmental charges and levies upon it or upon any of its income, profits,
or property prior to the date on which penalties attach thereto; provided,
however, that for purposes of this Agreement, neither the Borrower nor the
relevant Subsidiary shall be required to pay any tax, assessment, charge or levy
(i) the payment of which is being contested in good faith by appropriate
proceedings diligently conducted and (ii) as to which the Borrower shall have
set aside on its books reserves for such claims as are determined to be adequate
pursuant to the accounting procedures employed by the Borrower, but only to the
extent that failure to discharge any such liabilities upon the conclusion of
such proceedings or at any other applicable time would not result in any
additional liability which could reasonably be expected to result in a Material
Adverse Change.
4.7 INSURANCE. The Borrower will keep and maintain, and cause each Subsidiary to
keep and maintain, insurance with responsible insurance companies, in such
amounts and against such risks as is customarily maintained by similar
businesses similarly situated and owning, leasing or
- 42 -
operating similar properties. The Borrower may satisfy the requirements of the
preceding sentence with self insurance and deductibles consistent with customary
and prudent industry standards, all as reasonably satisfactory to the Agent. The
Borrower will furnish to the Agent at the Closing and together with the annual
reports delivered pursuant to Subsection 4.2(ii) hereof, a certificate of an
Authorized Officer of the Borrower certifying that such insurance is in force,
is adequate in nature and amount and complies with the Borrower's and each
Subsidiary's obligations under this Section 4.7.
4.8 MAINTENANCE OF PROPERTIES. The Borrower shall and shall cause its
Subsidiaries to maintain, preserve, protect and keep their respective properties
in good repair, working order and condition (ordinary, wear and tear excepted),
and make all necessary and proper repairs, renewals and replacements so that
their business carried on in connection therewith may be properly and
advantageously conducted at all times, except where the failure to maintain,
preserve, protect or keep such properties could not reasonably be expected to
result in a Material Adverse Change.
4.9 PLANS AND BENEFIT ARRANGEMENT. The Borrower shall, and shall cause each
ERISA Affiliate to, comply with ERISA, the Code and all other applicable laws
which are applicable to Plans, except where the failure to do so, alone or in
conjunction with any other failure to do so, could not reasonably be expected to
result in a Material Adverse Change.
4.10 SENIOR DEBT STATUS. The Bank Indebtedness will rank at least pari passu in
priority of payment with all other Indebtedness of the Borrower, except
Indebtedness of the Borrower which may be secured by Encumbrances permitted
pursuant to Section 5.2.
4.11 LEASES; MATERIAL CONTRACTS. (i) The Borrower will perform and observe, or
cause to be performed and observed, all of the covenants and conditions required
to be performed by it or any of its Subsidiaries under each Lease, except where
such failure could not reasonably be expected to result in a Material Adverse
Change.
(ii) The Borrower will promptly notify the Agent in writing of the receipt
by the Borrower or any Subsidiary of any notice from any third party to the
Borrower or any Subsidiary of any material default under, or the termination of,
any Material Contract pursuant to the provisions of such Material Contract, and
will promptly cause a copy of each such notice received by the Borrower or any
Subsidiary from any third party to be delivered to the Agent.
(iii) The Borrower will not, nor will it permit any Subsidiary to, without
the prior written consent of the Required Lenders, terminate or surrender, or
suffer or permit any termination or surrender, of any Material Contract during
the initial term thereof or any valid extension thereto, other than the
termination of such Material Contract as the result of the exhaustion of the
coal reserves subject thereto as shown on the reports delivered to the Agent
pursuant to Section 4.2(x) or otherwise in accordance with the terms of such
Material Contract.
4.12 CLEAN-DOWN PERIOD. The Borrower will cause the aggregate outstanding
principal balance of Distribution Loans to be zero for a period of at least
fifteen (15) consecutive days during each twelve month period.
- 43 -
4.13 ENVIRONMENTAL INDEMNIFICATION. The Borrower shall defend and indemnify the
Agent and each Lender and hold them harmless from and against all loss,
liability, damage, expense, claims, costs, fines, penalties, assessments
(including interest on any of the foregoing) and reasonable attorneys' fees,
suffered or incurred by the Agent or any Lender which arise, result from or in
any way relate to a breach or violation by the Borrower or any Guarantor of any
applicable Environmental Law, either prior to or subsequent to the date hereof,
including the assertion or imposition of any Encumbrance on the Borrower's or
any Guarantor's assets, or which relate to or arise out of an Environmental
Claim. The Borrower's obligations hereunder shall survive the termination of
this Agreement and the repayment of the Bank Indebtedness.
5. NEGATIVE COVENANTS.
From the date hereof and thereafter until the Revolving Credit Commitments
are terminated and until the Bank Indebtedness is paid in full, the Borrower
agrees that:
5.1 DIVIDENDS, ETC.. The Borrower will not declare or make any dividend payment
or other distribution of assets, properties, cash, rights, obligations or
securities on account of any member interests or other equity of the Borrower,
or purchase, redeem or otherwise acquire for value (or permit any of its
Subsidiaries to do so) any member interests or other equity of the Borrower or
any warrants, rights or options to acquire any such interests, now or hereafter
outstanding (each of the foregoing being a "Restricted Payment"), except that,
so long as no Event of Default or Potential Default shall have occurred and be
continuing at such time or could reasonably be expected to result therefrom, (a)
the Borrower may declare, make or incur a liability to make distributions to the
Parent to fund Quarterly Distributions provided that (i) such Quarterly
Distributions are made in accordance with the provisions of the MLP Agreement
(as in effect on the Closing Date), and (ii) the aggregate amount of Quarterly
Distributions made by the Parent with respect to any Fiscal Quarter shall not
exceed Available Cash for such Fiscal Quarter; and (b) the Borrower may make
payments to the Parent in such amounts as required to pay the general and
administrative costs and expenses of the Parent incurred in connection with the
operation of its business as permitted pursuant to the terms of its Guaranty
Agreement.
5.2 ENCUMBRANCES. The Borrower will not create or suffer to exist, or permit any
of its Subsidiaries to create or suffer to exist, any Encumbrance or any other
type of preferential arrangement, upon or with respect to any of its properties,
whether now owned or hereafter acquired, or assign, or permit any of its
Subsidiaries to assign, any right to receive income, in each case to secure or
provide for the payment of any Indebtedness of any Person, other than (a)
Encumbrances created under the Loan Documents, (b) purchase money liens or
purchase money security interests upon or in any property acquired or held by
the Borrower or any Subsidiary in the ordinary course of business to secure the
purchase price of such property or to secure indebtedness incurred solely for
the purpose of financing the acquisition of such property, so long as such
indebtedness does not exceed 100% of the purchase price of such property, (c)
Encumbrances existing on such property at the time of the acquisition of such
property or the acquisition of such Subsidiary (other than any such Encumbrance
created as a result of such acquisition), (d) Permitted Encumbrances, or (e)
extensions or renewals of any Encumbrance described in clauses (b) through (d)
above, provided, that (i) any such extension or renewal shall be limited to the
property theretofore subject to such Encumbrance, (ii) the principal amount of
- 44 -
the Indebtedness secured by such Encumbrance shall not be increased and (iii)
the aggregate principal amount of Indebtedness secured by Encumbrances referred
to in clauses (b) through (d) above shall not exceed $1,000,000 at any time
outstanding (it being expressly agreed that any refinanced Indebtedness shall
not be considered new Indebtedness hereunder).
5.3 FINANCIAL COVENANTS.
5.3a LEVERAGE RATIO. At no time shall the ratio of the Parent's Consolidated
Total Indebtedness to its Consolidated EBITDDA for the four (4) most recently
completed Fiscal Quarters, taken as a single accounting period, exceed 2.50 to
1.00.
5.3b INTEREST COVERAGE RATIO. At no time shall the ratio of the Parent's
Consolidated EBITDDA for the four (4) most recently completed Fiscal Quarters,
taken as a single accounting period, to its Consolidated Interest Expense for
the four (4) most recently completed Fiscal Quarters, taken as a single
accounting period, be less than 4.00 to 1.00.
5.3c CALCULATION OF CONSOLIDATED EBITDDA. For purposes of calculating
Consolidated EBITDDA of the Parent and its Consolidated Subsidiaries for any
period for the purposes of this Section 5.3 only, the earnings before interest,
taxes, depletion, depreciation and amortization calculated as set forth in the
definition of "Consolidated EBITDDA" above of any Person or assets acquired by
the Borrower or its Subsidiaries during such period shall be included on a pro
forma basis for such period as if such acquisition and the incurrence or
assumption of any Indebtedness in connection therewith had occurred on the first
day of such period and based upon the financial statements and other information
delivered to the Agent pursuant to Section 5.4.
5.4 ACQUISITIONS. The Borrower shall not, except as otherwise permitted or
required in this Agreement, purchase or otherwise acquire, or permit any
Subsidiary to purchase or acquire, any obligations or stock of, or any other
interest in, or all or substantially all of the assets of, any Person
whatsoever, other than (i) pursuant to a merger permitted under Section 5.8
below or (ii) other non-hostile acquisitions of the equity securities or assets
of any domestic Person, provided that (a) immediately prior to and after giving
effect to any such acquisition, no Event of Default or Potential Default shall
have occurred or be continuing or will result therefrom, (b) such acquisition is
consummated in accordance with applicable law, except where any non-compliance
with applicable law could not reasonably be expected to result in a Material
Adverse Change, (c) if such acquisition is of equity securities of a Person,
such Person complies with Section 2.14 above, and substantially all of the
assets held by such Person are Permitted Assets, (d) if such acquisition is of
assets, substantially all such assets are Permitted Assets, (e) the Borrower
shall be in pro forma compliance with this Agreement and shall deliver to the
Agent no less than three (3) Business Days prior to the date of the proposed
acquisition (A) a certificate which indicates pro forma compliance with the
financial covenants set forth in Section 5.3, in each case after giving effect
to such acquisition and (B) if available, financial statements with respect to
such Person or assets supporting the calculations set forth in such certificate
and, in the case of the foregoing clauses (A) and (B), in form and substance
satisfactory to the Agent, and (f) such acquired Person or assets shall not be
subject to any material liabilities or Encumbrances
- 45 -
except as permitted by this Agreement. A transaction meeting the requirements of
clause (ii) above shall be referred to herein as a "Permitted Acquisition."
5.5 INDEBTEDNESS. The Borrower shall not and shall not permit its Subsidiaries
to create, incur, assume or permit to exist or remain outstanding any
Indebtedness, except for:
(i) the Indebtedness owed by the Loan Parties under the Loan Documents;
(ii) Indebtedness of the Borrower to any Subsidiary and of any Subsidiary
to the Borrower or any other Subsidiary;
(iii) Indebtedness of the Borrower and its Subsidiaries secured by
Encumbrances permitted under Section 5.2;
(iv) performance Guarantees entered into in the ordinary course of
business with respect to the performance of any obligation of any Subsidiary of
the Borrower;
(v) Indebtedness of the Borrower incurred pursuant to a Hedging Obligation
with a Lender or an affiliate of a Lender entered into in the ordinary course of
the business of the Borrower and not for speculative purposes; and
(vi) other unsecured Indebtedness owed by the Borrower and its
Subsidiaries pursuant to a sale of notes in a public offering or a private
placement in an aggregate principal amount not to exceed $100,000,000 at any one
time outstanding, provided (a) the terms and provisions of such Indebtedness are
no more restrictive than the terms and provisions of this Agreement as
determined by the Agent in its sole discretion and such terms and provisions are
otherwise satisfactory to the Agent in its sole discretion, (b) the final
maturity date of such Indebtedness is after the Termination Date and (c) after
giving effect to the issuance of such Indebtedness, the Borrower shall be in pro
forma compliance with the covenants set forth in Section 5.3 as demonstrated by
the delivery of a Pro Forma Compliance Certificate to the Agent not less than
ten (10) Business Days prior to the closing of such Indebtedness.
5.6 LOANS, ACQUISITIONS AND INVESTMENTS. The Borrower and its Subsidiaries shall
not at any time make any loan or advance to, or purchase or otherwise acquire
any stock, bonds, notes or securities of, or any partnership interest (whether
general or limited) or other equity interest in, or assets of, or any other
investment or interest in or make any capital contribution to, any other Person,
or agree to or become liable to do any of the foregoing, except for:
(a) trade credit extended on usual and customary terms in the
ordinary course of business;
(b) fixed assets, equipment or inventory acquired in the ordinary
course of business;
(c) loans and advances to employees to meet expenses incurred by
such employees in the ordinary course of business, including without limitation
relocation expenses;
- 46 -
(d) Permitted Investments;
(e) loans, advances and capital contributions by a Subsidiary of the
Borrower to the Borrower or any of the Borrower's other Subsidiaries or loans,
advances and capital contributions by the Borrower to any of its Subsidiaries;
(f) Permitted Acquisitions; and
(g) loans and/or investments listed on Schedule 5.6.
5.7 SALES OF ASSETS. Neither the Borrower nor any Subsidiary shall enter into
any arrangement, direct or indirect, pursuant to which the Borrower or any
Subsidiary shall sell or otherwise transfer or dispose of any property, real,
personal or mixed, whether now owned or hereafter acquired, except (i) sales,
transfers or dispositions in the ordinary course of business, (ii) sales,
transfers or dispositions not in the ordinary course of business provided that
the aggregate proceeds of all such sales, transfers and dispositions permitted
by this item (ii) shal1 not exceed, (A) from the date hereof during any period
of twelve (12) consecutive months more than $10,000,000 and (B) during the term
hereof more than $25,000,000, (iii) sales of wetlands credits, and (iv) sales,
transfers or dispositions not in the ordinary course of business and in excess
of the amounts permitted under Section 5.7(ii), provided that the proceeds of
the sale, transfer or disposition (a) represent the fair market value of the
assets and (b) within 180 days after the date of such transaction, and at the
Borrower's election, are applied to either (1) the purchase or acquisition of
Permitted Assets or (2) the repayment of the Revolving Credit Loans and
permanent reduction of the Revolving Credit Commitments in the amount of such
proceeds, provided further until the Borrower makes its election under Section
5.8(iv)(b), the Revolving Credit Commitment shall be temporarily reduced by the
amount of the proceeds received by the Borrower.
5.8 MERGER. The Borrower shall not merge or consolidate with any other Person or
permit any of its Subsidiaries to do so, except, so long as no Event of Default
or Potential Default then exists or would result therefrom, (A) a merger or
consolidation of any Subsidiary with or into any other Subsidiary or the
Borrower or (B) a merger or consolidation constituting a Permitted Acquisition,
provided that in any merger or consolidation involving the Borrower, the
Borrower is the surviving entity.
5.9 REGULATION T, U AND X COMPLIANCE. The Borrower shall not and shall not
permit any Subsidiary to use the proceeds of a Revolving Credit Loan to purchase
or carry Margin Stock or otherwise act so as to cause any Lender, in extending
credit hereunder, to be in contravention of Regulations T, U or X.
5.10 ERISA. The Borrower shall not and shall not permit any ERISA Affiliate to
permit any Plan to:
(i) engage in any "prohibited transaction", as such term is defined
in Section 406 of ERISA and Section 4975 of the Code;
- 47 -
(ii) incur any "accumulated funding deficiency", as such term is
defined in Section 302 of ERISA, whether or not waived;
(iii) be terminated in a manner which could result in liability to
the PBGC under Title IV of ERISA or the imposition of a lien on the
property of the Borrower or any ERISA Affiliate pursuant to Section 4068
of ERISA; or
(iv) partially or completely withdraw from any Multiemployer Plan,
which withdrawal shall subject the Borrower or any ERISA Affiliate to
multiemployer withdrawal liability pursuant to Section 4201 of ERISA,
if any such event could reasonably be expected to result in a Material Adverse
Change.
5.11 NO LIMITATION ON DIVIDENDS AND DISTRIBUTIONS. The Borrower shall not permit
its Subsidiaries to enter into or otherwise be bound by any agreement, or any
provision of any certificate of incorporation, by-laws, partnership agreement,
operating agreement or other organizational, formation or governing document,
not to pay dividends or make distributions to the Borrower, except as imposed by
any Governmental Rule or Governmental Authority.
5.12 NEGATIVE PLEDGES. The Borrower shall not directly or indirectly enter into
or assume, or permit any Subsidiary to enter into or assume, any agreement
(other than this Agreement and the other Loan Documents), or any provision of
any certificate of incorporation, by-laws, partnership agreement, operating
agreement or other organizational, formation or governing document, prohibiting
the creation or assumption of any lien or Encumbrance upon any of the Borrower's
or its Subsidiaries' properties, whether now owned or hereafter created or
acquired, or otherwise prohibiting or restricting any transaction contemplated
hereby; provided that the foregoing shall not apply to (i) restrictions and
conditions imposed by any Governmental Rule or by any Loan Document, (ii)
restrictions or conditions imposed by any agreement relating to secured
Indebtedness or other obligations permitted by this Agreement but only to the
extent such restriction or condition is limited to the specific assets subject
to a Permitted Encumbrance, or (iii) customary provisions in leases or other
agreements restricting the assignment thereof.
5.13 CHANGES IN ORGANIZATIONAL DOCUMENTS. The Borrower shall not permit or
suffer to exist any amendment or modification in any respect of the Borrower's
or any of its Subsidiaries' organizational documents or the MLP Agreement
without providing at least fifteen (15) days prior written notice to the Agent
and the Lenders and, in the event such change could reasonably be expected to
materially adversely affect the interests of the Lenders as determined by the
Agent in its sole discretion, obtaining the prior written consent of the
Required Lenders.
5.14 CHANGE IN NATURE OF BUSINESS. The Borrower shall not make, or permit any of
its Subsidiaries to make, any material change in the nature of their businesses,
taken as a whole, as carried on at the Closing Date.
5.15 CHANGES IN OMNIBUS AGREEMENT. Without the prior written consent of the
Agent, which consent shall not be unreasonably withheld or delayed, neither the
Parent, the Borrower nor any of its Subsidiaries shall (i) make any material
change to the terms of Omnibus Agreement, (ii) release any party from its
obligations under the Omnibus Agreement or (iii) fail
- 48 -
to diligently enforce the Omnibus Agreement and avail itself of the rights and
indemnities available thereunder.
5.16 TRANSACTIONS WITH AFFILIATES. Neither the Borrower nor any Loan Party shall
enter into or carry out any transaction with an Affiliate (including purchasing
property or services from or selling property or services to any Affiliate of
Borrower or other Person) unless such transaction is not otherwise prohibited by
this Agreement, is entered into in the ordinary course of business upon fair and
reasonable arm's-length terms and conditions.
6. CONDITIONS PRECEDENT TO DISBURSEMENTS AND ISSUANCE OF LETTERS OF CREDIT
6.1 ALL DISBURSEMENTS. The obligation of the Lenders to make any Disbursements
hereunder, or of the Agent to issue, renew or extend any Letters of Credit
hereunder, is subject to the performance by the Borrower of its obligations to
be performed hereunder at or prior to the making of any such Disbursement or the
issuance, renewal or extension of any such Letter of Credit, as the case may be,
and to the satisfaction of each of the following conditions precedent:
6.1a NO DEFAULT. The Borrower shall have performed and complied, in all material
respects, with all agreements and conditions herein required to be performed or
complied with by it prior to any Disbursements or to the issuance, renewal or
extension of any Letter of Credit, and, at the time of such Disbursements or
such issuance, renewal or extension, no Potential Default or Event of Default
shall exist.
6.1b REPRESENTATIONS CORRECT. The representations and warranties contained in
Article III hereof and in the other Loan Documents shall be correct in all
material respects (i) when made and (ii) at the time of each Disbursement or
issuance, renewal or extension of a Letter of Credit except for such
representations and warranties which relate solely to an earlier date (in which
case such representations and warranties shall have been true and correct in all
material respects as of such date).
6.1c NO MATERIAL ADVERSE CHANGE. At the time of the making of any Disbursement
or the issuance, renewal or extension of any Letter of Credit, no Material
Adverse Change shall have occurred and be continuing.
6.1d LOAN REQUEST/APPLICATION. The Borrower shall have complied (i) with the
requirements of Section 2.1 or Section 2.2, as appropriate, with respect to a
requested Disbursement, and (ii) with the requirements of Section 2.6 with
respect to the issuance of a Letter of Credit.
Each request for Disbursement and each request for the issuance, renewal or
extension of a Letter of Credit shall constitute, as at the time made, a
representation and warranty by the Borrower that the matters set forth in
Subsections 0.xx, 6.1b and 6.1c above are true and correct.
6.2 CONDITIONS PRECEDENT TO INITIAL BORROWINGS. The obligation of the Lenders to
make the initial Disbursements is subject to the satisfaction of each of the
following conditions precedent in addition to the applicable conditions
precedent set forth in Section 6.1 above:
- 49 -
(i) Receipt by the Agent on behalf of each Lender of a counterpart
original of this Agreement executed by the other Lenders and the Borrower.
(ii) Receipt by the Agent on behalf of each Lender of a Revolving
Credit Note, substantially in the form of Exhibit "A" attached hereto,
made payable to such Lender in the amount of such Lender's Revolving
Credit Commitment and otherwise properly completed and executed by the
Borrower.
(iii) Receipt by the Agent of all schedules to this Agreement, in
form and substance satisfactory to the Lenders.
(iv) Receipt by the Agent of a Guaranty Agreement duly executed by
each of the Guarantors.
(v) Receipt by the Agent of the following formation, governance or
other documents for each Loan Party and the General Partner:
(a) a copy of its partnership agreement, operating agreement,
articles and/or certificate of incorporation, and other formation or
governmental documents, certified as true and correct by the secretary of
the respective Loan Party or the General Partner, as the case may be;
(b) good standing or subsistence certificates relating to each
Loan Party and the General Partner executed by the Secretary of State of
each state in which such Loan Party or the General Partner, as the case
may be, conducts its business;
(c) resolutions or other evidence of approval of the partners,
board of directors or other governing body authorizing the execution of
the Loan Documents and the performance by the Loan Parties pursuant
thereto, certified by the secretary or other officer of the respective
Loan Party (or, if applicable, of the respective Loan Party's general
partner or managing member) as being true, correct, complete and in effect
and in form and substance satisfactory to the Agent:
(d) a copy of the by-laws (or equivalent documents), if any,
and all amendments thereto, certified by the secretary or other officer of
each Loan Party and the General Partner as being true, correct, complete
and in effect; and
(e) an incumbency certificate for each Loan Party and the
General Partner, showing the names of the Authorized Officers of each Loan
Party and the General Partner, their titles and containing their true
signatures.
(vi) Receipt by the Agent of a certificate of an Authorized Officer
of the Borrower certifying that the insurance required to be maintained by
the Borrower and its Subsidiaries by Section 4.7 hereof is in force and is
adequate in nature and amount.
(vii) Receipt by the Agent of written instructions addressed to the
Agent and executed by an Authorized Officer of the Borrower relating to
the initial Disbursements.
- 50 -
(viii) Receipt by the Agent on behalf of each Lender of a signed
favorable opinion of Xxxxxx & Xxxxxx L.L.P, special counsel to the
Borrower, dated as of the Closing Date and in form and substance
satisfactory to Agent and its counsel as to the matters set forth on
Exhibit "E" attached hereto.
(ix) Receipt by the Agent, for the benefit of each Lender and the
Agent, of a certificate of the Borrower, dated the Closing Date and signed
by an Authorized Officer of the Borrower, regarding the satisfaction of
the conditions set forth in Subsections 6.1a, 6.1b and 6.1c.
(x) Receipt by the Agent on its own behalf and on behalf of the
Lenders of all Fees due and payable on or prior to the Closing Date and
all reimbursable expenses incurred on or prior to the Closing Date for
which invoices (in reasonable detail) have been furnished to the Borrower.
(xi) The Lenders shall have received satisfactory evidence that (a)
the Transaction has been completed, including without limitation the sale
of 4,500,000 common units of the Parent by the Parent and Arch Coal
pursuant to the Transaction and receipt by the Parent and Arch Coal of
gross cash proceeds in a minimum amount of $80,000,000 and (b) the Parent
shall have received (1) cash from the proceeds of such offering in an
amount at least equal to $50,100,000 (after deducting underwriting
discounts but before paying estimated offering expenses) and (2) cash from
Arch Coal in an amount at least equal to $800,000, and such cash proceeds
have been applied up to the amount needed to repay the Indebtedness
assumed by the Parent from the WPP Group in the approximate amount of
$46,500,000.
(xii) Receipt by the Agent of true and correct copies of the Leases
listed on Schedule 3.23 and satisfactory review thereof by the Agent and
its counsel.
(xiii) The Agent and the Lenders (a) shall have completed and be
satisfied with all requested due diligence with respect to the Borrower
and the other Loan Parties, including without limitation, (1) a review of
Lease files, title files, record searches and Encumbrances affecting
Leases, (2) an independent reserve report, (3) an analysis of
environmental liabilities with respect to properties owned or to be
acquired at Closing, and (4) the financial statements and pro forma
financial statements delivered pursuant to Section 3.7; (b) shall be
satisfied as to the amount and nature of all environmental, tax, ERISA,
employee retirement benefit and other contingent liabilities to which the
Borrower and the other Loan Parties may be subject; and (c) shall be
satisfied that, as of the Closing, neither the Borrower nor any other Loan
Party has any outstanding Indebtedness except for the Bank Indebtedness or
as otherwise expressly permitted under Section 5.5.
(xiv) The Agent and the Lenders shall have received a true, correct
and complete copy of the Omnibus Agreement and all other documents
transferring the Leases and any other material agreements from the
Contributors to the Loan Parties, all of which shall be satisfactory to
the Agent and the Lenders.
- 51 -
7. DEFAULTS
Each of the events or occurrences described in Sections 7.1 to and
including 7.10 below shall constitute an "Event of Default" hereunder.
7.1 PAYMENT DEFAULT. Default in the payment of (i) interest on any Revolving
Credit Loan, any Fee, or any other amount due hereunder or under any other Loan
Document, and continuance of any such nonpayment of such interest, Fee or other
amount for three (3) Business Days, or (ii) principal of any Revolving Credit
Loan when due.
7.2 NONPAYMENT OF OTHER INDEBTEDNESS. Any Loan Party shall fail to pay any
Indebtedness of such Loan Party, other than the Bank Indebtedness, in an
aggregate amount as to the Loan Parties collectively of $1,000,000 or more, as
and when the same shall become due, or the occurrence of any default under any
agreement or instrument under or pursuant to which such Indebtedness is incurred
or issued and continuance of such default beyond the period of grace, if any,
allowed with respect thereto, if such default permits or causes the acceleration
of such Indebtedness or the termination of any commitment to lend with respect
thereto.
7.3 INSOLVENCY.
7.3a INVOLUNTARY PROCEEDINGS. A proceeding shall have been instituted in a court
having jurisdiction seeking a decree or order for relief in respect of the
Parent, the General Partner, the Borrower or any Subsidiary of the Borrower in
an involuntary case under the Federal bankruptcy laws, or any other similar
applicable Federal or state law, now or hereafter in effect, or for the
appointment of a receiver, liquidator, trustee, sequestrator or similar official
for the Parent, the General Partner, the Borrower or any of its Subsidiaries or
for a substantial part of its or their property, or for the winding up or
liquidation of its or their affairs, and the same shall remain undismissed or
unstayed and in effect for a period of sixty (60) days.
7.3b VOLUNTARY PROCEEDINGS. The Parent, the General Partner, the Borrower or any
Subsidiary of the Borrower shall institute proceedings to be adjudicated a
voluntary bankrupt, or any of them shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent seeking
reorganization under the Federal bankruptcy laws, or any other similar
applicable Federal or state law now or hereinafter in effect, or shall consent
to the filing of any such petition or shall consent to the appointment of a
receiver, liquidator, trustee, sequestrator or similar official for the Parent,
the General Partner, the Borrower or any of its Subsidiaries or for a
substantial part of its or their property, or shall make an assignment for the
benefit of creditors, or shall admit in writing its or their inability to pay
its or their debts generally as they become due, or corporate action shall be
taken by the Parent, the General Partner, the Borrower or any of its
Subsidiaries in furtherance of any of the aforesaid purposes.
7.4 TERMINATION OF EXISTENCE. The Borrower, the Parent, the General Partner or
any Subsidiary of the Borrower shall terminate its existence or cease to exist
(i) except by reason of a permitted merger or liquidation of a Subsidiary into
or a consolidation of a Subsidiary with the Borrower or another Subsidiary of
the Borrower, or (ii) except where a Subsidiary's termination
- 52 -
or cessation of its existence could not reasonably be expected to result in a
Material Adverse Change.
7.5 FAILURE TO COMPLY WITH LOAN DOCUMENTS.
7.5a FAILURE TO COMPLY WITH ARTICLE V COVENANTS AND CERTAIN ARTICLE IV
COVENANTS. The Borrower shall default in the observance or performance of
Section 4.3, Section 4.4, Section 4.10, Section 4.11 or of any covenant
contained in Article V.
7.5b FAILURE TO COMPLY WITH OTHER COVENANTS AND LOAN DOCUMENTS. Any Loan Party
shall default in the due performance or observance of any other covenant,
condition or provision set forth herein or in any of the other Loan Documents to
which it is a party and such default shall not be remedied (i) with respect to
any default under Section 4.2(ix) hereunder for a period of ten (10) days, and
(ii) with respect to any other such default for a period of thirty (30) days
after such default is known to any Authorized Officer of the Borrower or notice
thereof has been given to the Borrower by the Agent.
7.6 MISREPRESENTATION. Any representation or warranty made by any Loan Party
herein or in any other Loan Document proves to have been untrue in any material
respect as of the date when made, or any certificate or other document furnished
by the Borrower or any other Loan Party to the Agent or any Lender pursuant to
the provisions hereof proves to have been untrue in any material respect on the
date as of which the facts set forth therein are stated or certified.
7.7 ADVERSE JUDGMENTS, ETC.. Entry or filing of any one or more judgments, writs
or warrants of attachment or of any similar process in an aggregate amount, as
to the Parent, the Borrower and its Subsidiaries or any one or more of them, of
$1,000,000 or more in excess of any third-party insurance protecting against
such liability against the Parent, the Borrower and its Subsidiaries or against
any of their respective properties and failure of the Borrower or its
Subsidiaries to vacate, pay, bond, stay or contest in good faith such judgments,
writs, warrants of attachment or other process within a period of thirty (30)
days.
7.8 INVALIDITY OR UNENFORCEABILITY. This Agreement, the Revolving Credit Notes
or any other Loan Document ceases to be valid and binding on any Loan Party in
any material respect or is declared null and void in any material respect, or
the validity or enforceability thereof is contested by any Loan Party or any
Loan Party denies it has any or further liability under this Agreement, any
Revolving Credit Note or under the other Loan Documents to which it is a party.
7.9 ERISA. (i) A trustee shall be appointed by a court of competent jurisdiction
to administer any Plan of the Borrower or any ERISA Affiliate; (ii) the PBGC
shall terminate any Plan of the Borrower or any ERISA Affiliate or appoint a
trustee to administer any such Plan; or (iii) the Borrower or any ERISA
Affiliate shall incur any liability to the PBGC in connection with any Plan,
which, in any such case of clauses (i), (ii) or (iii), could reasonably be
expected to result in a Material Adverse Change.
7.10 CHANGE IN CONTROL. Any Change in Control shall occur.
- 53 -
7.11 CONSEQUENCES OF AN EVENT OF DEFAULT. If one or more of the Events of
Default occur then (a) if such Event of Default is set forth in Sections 7.3 or
7.4, the Revolving Credit Commitments shall automatically terminate and the
Revolving Credit Notes then outstanding shall become immediately due and
payable, without necessity of demand, presentation, protest, notice of dishonor
or notice of default, and the Agent shall be under no further obligation to
issue, renew, extend or amend Letters of Credit hereunder; or (b) if such Event
of Default is set forth in any Sections of this Article VII other than Sections
7.3 or 7.4, then the Agent, upon the direction of the Required Lenders, and
without notice to the Borrower, shall declare the Borrower in default hereunder,
and upon such declaration, shall, upon the direction of the Required Lenders,
terminate the Revolving Credit Commitments and/or terminate the obligation of
the Agent to issue, renew, extend or amend Letters of Credit and/or declare the
unpaid principal amount of the Revolving Credit Notes then outstanding and all
interest accrued thereon, any unpaid Fees and all other Bank Indebtedness
immediately due and payable, without necessity of any further demand,
presentation, protest, notice of dishonor or further notice of default,
whereupon such amounts shall be immediately due and payable.
7.12 REMEDIES UPON DEFAULT. Upon the termination of the Revolving Credit
Commitments and the obligation to issue Letters of Credit and the acceleration
of the Revolving Credit Notes and the other Bank Indebtedness following the
occurrence of an Event of Default, the Lenders shall, unless such termination
and acceleration have subsequently been rescinded by the Agent at the direction
of the Required Lenders, have the full panoply of rights and remedies granted to
them under this Agreement and the other Loan Documents and all those rights and
remedies granted by law to creditors, and the Agent, at the direction of the
Required Lenders, shall proceed to protect and enforce the Lenders' rights by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein, in the Revolving Credit
Notes or in any of the other Loan Documents, or for an injunction against a
violation of any of the terms hereof or thereof, or in aid of the exercise of
any power granted hereby or thereby or by law. No right, power or remedy
conferred by this Agreement, in the Revolving Credit Notes, or by any other Loan
Document, upon the Agent or the Lenders shall be exclusive of any other right,
power or remedy referred to herein or therein or now or hereafter available at
law, in equity, by statute or otherwise. No exercise of any one right or remedy
shall be deemed a waiver of other rights or remedies. The rights and remedies of
the Agent and the Lenders specified herein are for the sole and exclusive
benefit, use and protection of the Agent and the Lenders, and the Agent and the
Lenders shall be entitled, but shall have no duty or obligation, to exercise or
to refrain from exercising any right or remedy reserved to the Agent or the
Lenders hereunder.
7.13 CASH COLLATERAL. Upon the occurrence of any Event of Default described in
Sections 7.3 or 7.4 or upon the declaration by the Required Lenders of any other
Event of Default and the termination of the Revolving Credit Commitments, the
obligation of the Agent to issue or amend Letters of Credit shall terminate, and
an amount equal to the maximum amount which may at any time be drawn under the
Letters of Credit then outstanding (whether or not any beneficiary of such
Letters of Credit shall have presented, or shall be entitled at such time to
present, the drafts or other documents required to draw under such Letters of
Credit) shall automatically become immediately due and payable, without
presentment, demand, protest or other requirements of any kind, all of which are
hereby expressly waived by the Borrower; provided that the foregoing
- 54 -
shall not affect in any way the obligations of the Lenders to purchase from the
Agent participations in the unreimbursed amount of any drawings under the
Letters of Credit issued by it as provided in Subsection 2.6d. So long as the
Letters of Credit shall remain outstanding, any amounts declared due pursuant to
this Section 7.13 with respect to the outstanding Letters of Credit when
received by the Agent shall be deposited and held by the Agent in an interest
bearing account denominated in the name of the Agent for the benefit of the
Agent and the Lenders over which the Agent shall have sole dominion and control
of withdrawals (the "Cash Collateral Account") as cash collateral for the
obligation of the Borrower to reimburse the Agent in the event of any drawing
under the Letters of Credit and upon any drawing under such Letters of Credit in
respect of which the Agent has deposited in the Cash Collateral Account any
amounts declared due pursuant to this Section 7.13, the Agent shall apply such
amounts held by the Agent to reimburse the Agent for the amount of such drawing.
In the event that any Letter of Credit in respect of which the Agent has
deposited in the Cash Collateral Account any amounts described above is
cancelled or expires or in the event of any reduction in the maximum amount
available at any time for drawing under any of the Letters of Credit
outstanding, the Agent shall apply the amount then in the Cash Collateral
Account designated to reimburse the Agent for any drawings under the Letters of
Credit issued by it less the maximum amount available at any time for drawing
under the Letters of Credit remaining outstanding immediately after such
cancellation, expiration or reduction, if any, to the payment in full of the
outstanding Bank Indebtedness, and second, to the payment of any excess, to the
Borrower.
8. AGREEMENT AMONG LENDERS.
8.1 APPOINTMENT AND GRANT OF AUTHORITY. Each of the Lenders hereby appoints PNC
Bank, National Association, and PNC Bank, National Association hereby agrees to
act, as the Agent under this Agreement, the Revolving Credit Notes and the other
Loan Documents. As such Agent, PNC Bank, National Association shall have and may
exercise such powers under this Agreement and the other Loan Documents as are
specifically delegated to the Agent, by the terms hereto or thereof, together
with such other powers as are incidental thereto. Without limiting the
foregoing, the Agent, on behalf of the Lenders, is authorized to execute all of
the Loan Documents, to accept all of the Loan Documents and all other
agreements, documents or instruments reasonably required to carry out the intent
of the parties to this Agreement and to release any Guarantor from its
obligations under its Guaranty Agreement in the event of the disposition of such
Guarantor as permitted in this Agreement.
8.2 DELEGATION OF DUTIES. The Agent may perform any of its duties hereunder by
or through agents or employees (provided such delegation does not constitute a
relinquishment of duties as the Agent hereunder) and, subject to Sections 8.7
and 9.2 hereof, shall be entitled to engage and pay for the advice or services
of any attorneys, accountants, or other experts concerning all matters
pertaining to duties hereunder and to rely upon any advice so obtained.
8.3 RELIANCE BY AGENT ON LENDERS FOR FUNDING. Unless the Agent shall have
received notice from a Lender prior to any Borrowing Date that such Lender will
not make available to the Agent such Lender's portion of disbursements of
Revolving Credit Loans, the Agent may assume that such Lender has made such
portion available to the Agent and the Agent may, in reliance upon such
assumption, make Revolving Credit Loans to the Borrower. If and to the
- 55 -
extent that such Lender has not made such portion available to the Agent on or
prior to any Borrowing Date, such Lender and the Borrower severally agree to
repay to the Agent immediately upon demand, in immediately available funds, such
unpaid amount, together with interest thereon for each day from the applicable
Borrowing Date until such amount is repaid to the Agent, (i) in the case of the
Borrower, at the rate of interest then in effect for such Revolving Credit Loan
and (ii) in the case of such Lender, at the Federal Funds Effective Rate. If
such Lender shall repay to the Agent such corresponding amount, such amount
shall constitute a Revolving Credit Loan made by such Lender for purposes of
this Agreement. The failure by any Lender to pay its portion of a Revolving
Credit Loan made by the Agent shall not relieve any other Lender of the
obligation to pay its portion of disbursements of Revolving Credit Loans on any
Borrowing Date, but no Lender shall be responsible for the failure of any other
Lender to make its share of Revolving Credit Loans to be made by such other
Lender on such Borrowing Date.
8.4 NON-RELIANCE ON AGENT. Each Lender agrees that it has, independently and
without reliance on the Agent, based on such documents and information as it has
deemed appropriate, made its own credit analysis and evaluation of the Borrower
and its operations and decision to enter into this Agreement and that it will,
independently and without reliance upon the Agent, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own analysis and decisions in taking or not taking action under this Agreement.
Except as otherwise provided herein, the Agent shall have no duty to keep the
Lenders informed as to the performance or observance by the Borrower of this
Agreement or any other Loan Document or to inspect the properties or books of
the Borrower. The Agent, in the absence of gross negligence or willful
misconduct, shall not be liable to any Lender for its failure to relay or
furnish to the Lender any information.
8.5 RESPONSIBILITY OF AGENT AND OTHER MATTERS.
8.5a MINISTERIAL NATURE OF DUTIES. As among the Lenders and the Agent, the Agent
shall have no duties or responsibilities except those expressly set forth in
this Agreement, the Revolving Credit Notes or in the other Loan Documents, and
those duties and responsibilities shall be subject to the limitations and
qualifications set forth in this Article VIII. The duties of the Agent shall be
ministerial and administrative in nature.
8.5b LIMITATION OF LIABILITY. As among the Lenders and the Agent, neither the
Agent nor any of its directors, officers, employees or agents shall be liable
for any action taken or omitted (whether or not such action taken or omitted is
within or without the Agent's responsibilities and duties expressly set forth in
this Agreement) under or in connection with this Agreement or any other
instrument or document in connection herewith except (notwithstanding anything
else contained in this Agreement) for gross negligence or willful misconduct.
Without limiting the foregoing, neither the Agent nor any of its directors,
officers or employees shall be responsible for, or have any duty to examine (i)
the genuineness, execution, validity, effectiveness, enforceability, value or
sufficiency of (A) this Agreement, the Revolving Credit Notes or any of the
other Loan Documents or (B) any other document or instrument furnished pursuant
to or in connection with this Agreement, (ii) the collectibility of any amounts
owed by the Borrower to the Lenders, (iii) the truthfulness of any recitals,
statements, representations or warranties made
- 56 -
to the Agent or the Lenders in connection with this Agreement, (iv) any failure
of any party to this Agreement to receive any communication sent, including any
telegram, teletype, facsimile transmission or telephone message or any writing,
application, notice, report, statement, certificate, resolution, request, order,
consent letter or other instrument or paper or communication entrusted to the
mails or to a delivery service, or (v) the assets, liabilities, financial
condition, results of operations or business, or creditworthiness of the
Borrower or any other Loan Party.
8.5c RELIANCE. The Agent shall be entitled to act, and shall be fully protected
in acting upon, any telegram, teletype, facsimile transmission or any writing,
application, notice, report, statement, certificate, resolution, request, order,
consent, letter or other instrument, paper or communication believed by the
Agent in good faith to be genuine and correct and to have been signed or sent or
made by a proper Person. The Agent may consult counsel and shall be entitled to
act, and shall be fully protected in any action taken in good faith, in
accordance with advice given by counsel. The Agent may employ agents and
attorneys-in-fact and shall not be liable for the default or misconduct of any
such agents or attorneys-in-fact selected by the Agent with reasonable care. The
Agent shall not be bound to ascertain or inquire as to the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any of the other Loan Documents on the part of the Borrower or any other party
hereto or thereto.
8.6 ACTIONS IN DISCRETION OF AGENT: INSTRUCTIONS FROM THE LENDERS. The Agent
agrees, upon the written request of the Required Lenders, to take or refrain
from taking any action of the type specified as being within the Agent's rights,
powers or discretion herein or under any Loan Documents, provided that the Agent
shall not be required to take any action which exposes the Agent to personal
liability or which is contrary to this Agreement or any other Loan Document or
applicable law. In the absence of a request by the Required Lenders, the Agent
shall have authority, in its sole discretion, to take or not to take any such
action, unless this Agreement specifically requires the consent of the Required
Lenders or all of the Lenders. Any action taken or failure to act pursuant to
such instructions or discretion shall be binding on the Lenders, subject to
Subsection 8.5b hereof. Subject to the provisions of Subsection 8.5b, no Lender
shall have any right of action whatsoever against the Agent as a result of the
Agent acting or refraining from acting hereunder in accordance with the
instructions of the Required Lenders.
8.7 INDEMNIFICATION. To the extent the Borrower does not reimburse and save
harmless the Agent according to the terms hereof for and from all costs,
expenses and disbursements in connection herewith, such costs, expenses and
disbursements shall be borne by the Lenders ratably in accordance with their
respective Revolving Credit Commitment. Each Lender hereby agrees on such basis
(i) to reimburse the Agent for such Lender's pro rata share of all such
reasonable costs, expenses and disbursements on request and (ii) to the extent
of each such Lender's pro rata share, to indemnify and save harmless the Agent
against and from any and all losses, obligations, penalties, actions, judgments
and suits and other costs, expenses and disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against the Agent,
other than as a consequence of gross negligence or willful misconduct on the
part of the Agent, arising out of or in connection with (a) this Agreement, the
Revolving Credit Notes, the other Loan Documents or any other agreement,
instrument or document executed or delivered in connection herewith or
therewith, or (b) any action taken at
- 57 -
the request of the Required Lenders or all of the Lenders hereunder, as the case
may be, including without limitation the reasonable costs, expenses and
disbursements in connection with defending themselves against any claim or
liability, or answering any subpoena or other process related to the exercise or
performance of any of their powers or duties under this Agreement, the other
Loan Documents, or any of the other agreements, instruments or documents
executed or delivered in connection herewith or the taking or refraining from
any action under or in connection with any of the foregoing.
8.8 AGENT'S RIGHTS AS A LENDER. With respect to the Revolving Credit Commitment
of the Agent as a Lender hereunder, and any Revolving Credit Loans of the Agent
under this Agreement, the other Loan Documents and any other agreements,
instruments and documents delivered pursuant hereto and any other amounts due to
the Agent under this Agreement, the Agent shall have the same rights and powers,
duties and obligations under this Agreement, the Revolving Credit Notes, the
other Loan Documents or other agreement, instrument or document as any Lender
and may exercise such rights and powers and shall perform such duties and
fulfill such obligations as though it were not the Agent. The Agent and its
affiliates may accept deposits from, lend money to, issue letters of credit for
the account of, and generally engage, and continue to engage, in any kind of
business with the Borrower and the other Loan Parties as if it were not the
Agent.
8.9 PAYMENT TO LENDERS. Except as otherwise set forth in Section 8.3 hereof,
promptly after receipt from the Borrower of any principal repayment of the
Revolving Credit Loans, interest due on the Revolving Credit Loans, any Fees or
any other amounts owing to the Lenders or other amounts due under any of the
Loan Documents (except for such amounts which are payable for the sole account
of any Lender or the Agent), the Agent shall distribute to each Lender that
Lender's share of the funds so received.
8.10 PRO RATA SHARING. Except as otherwise set forth in Section 8.3 hereof (x)
all interest and principal payments on the Revolving Credit Loans are to be
divided pro rata among the Lenders in proportion to the Revolving Credit Loans
outstanding from each Lender and (y) all payments of the Commitment Fee and the
Letter of Credit Fee are to be divided pro rata among the Lenders in accordance
with their respective Revolving Credit Commitment Percentages. Any sums obtained
from the Borrower by any Lender by reason of the exercise of its rights of
set-off, banker's lien or in collection shall be shared (net of costs) pro rata
among the Lenders on the basis of the principal amount of Revolving Credit Loans
outstanding. Nothing in this Section 8.10 shall be deemed to require the sharing
among the Lenders of collections specifically relating to, or of the proceeds of
any collateral securing, any other Indebtedness of the Borrower to any Lender.
8.11 SUCCESSOR AGENT.
8.11a RESIGNATION OF AGENT. The Agent may resign as Agent hereunder by giving
thirty (30) days' prior written notice to the Lenders and the Borrower. If such
notice shall be given, the Lenders shall appoint a successor agent for the
Lenders during such thirty (30) day period, which successor agent shall be
reasonably satisfactory to the Borrower, to serve as agent hereunder and under
the several Loan Documents. If at the end of such thirty (30) day period, the
Lenders have
- 58 -
not appointed such a successor, the Agent shall use reasonable commercial
efforts to procure a successor, reasonably satisfactory to the Lenders and the
Borrower, to serve as agent for the Lenders hereunder and under the several Loan
Documents. Any such successor agent shall succeed to the rights, powers and
duties of the Agent.
8.11b RIGHTS OF THE FORMER AGENT. Upon the appointment of such successor agent
or upon the expiration of such thirty (30) day period (or any longer period to
which the Agent has agreed), the former Agent's rights, powers and duties as
Agent shall be terminated, without any other or further act or deed on the part
of such former Agent or any of the parties to this Agreement. After any retiring
Agent's resignation hereunder as Agent hereunder, the provisions of this Article
VIII shall inure to the benefit of such retiring Agent as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
8.12 NOTICE OF DEFAULT. The Agent shall not be deemed to have knowledge or
notice of the occurrence of an Event of Default unless the Agent has received
written notice from a Lender or the Borrower referring to this Agreement,
describing such Event of Default and stating that such notice is a "notice of
default."
8.13 NOTICES. The Agent shall send to each Lender a copy of all notices received
from any Loan Party pursuant to the provisions of this Agreement or the other
Loan Documents promptly upon receipt thereof. The Agent shall promptly notify
the Borrower and the other Lenders of each change in the Base Rate and the
effective date thereof.
8.14 HOLDERS OF REVOLVING CREDIT NOTES. The Agent may deem and treat any payee
of any Revolving Credit Note as the owner thereof for all purposes hereof unless
and until written notice of the assignment or transfer thereof shall have been
recorded in the Register as contemplated by Section 9.6. Any request, authority
or consent of any Person who at the time of making such request or giving such
authority or consent is the holder of any Revolving Credit Note shall be
conclusive and binding on any subsequent holder, transferee or assignee of such
Revolving Credit Note or of any Revolving Credit Note or Revolving Credit Notes
issued in exchange therefor.
8.15 CALCULATIONS. In the absence of gross negligence or willful misconduct, the
Agent shall not be liable for any error in computing the amount payable to any
Lender whether in respect of the Revolving Credit Loans, Fees or any other
amounts due to the Lenders under this Agreement or any other Loan Documents. In
the event an error in computing any amount payable to any Lender is made, the
Agent, the Borrower and each affected Person shall, forthwith upon discovery of
such error, make such adjustments as shall be required to correct such error,
and any compensation therefor will be calculated at the Federal Funds Effective
Rate.
8.16 BENEFICIARIES. Except as expressly provided herein and in Sections 8.1,
8.3, 8.6, 8.1la, 8.14 and 8.15, the provisions of this Article VIII are solely
for the benefit of the Agent and the Lenders, and the Borrower shall not have
any rights to rely on or enforce any of the provisions hereof. In performing its
functions and duties under this Agreement, the Agent shall act solely as agent
of the Lenders and does not assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with or for the Borrower.
- 59 -
9. GENERAL PROVISIONS
9.1 AMENDMENTS AND WAIVERS. Subject to the remaining provisions of this Section
9.1, the Agent, the Lenders, the Guarantors and the Borrower may, from time to
time, enter into amendments, extensions, renewals, modifications, supplements
and replacements to and of this Agreement, the Revolving Credit Notes or the
other Loan Documents and the Lenders or the Required Lenders, as the case may
be, may, from time to time, waive compliance with a provision thereof. No
amendment, extension, renewal, modification, supplement, replacement, waiver or
consent of any provision of the Agreement, the Revolving Credit Notes or the
other Loan Documents or consent to any departure therefrom by the Borrower or
any Guarantor shall be effective unless it is in writing and is signed by the
Required Lenders (or the Agent with the written consent of the Required
Lenders), and then such waiver or consent shall be effective only for the
specific instance and for the specific purpose for which it is given; provided,
however, that no amendment, extension, renewal, modification, supplement,
replacement, waiver or consent, unless in writing and signed by all of the
Lenders (or the Agent with the written consent of all of the Lenders), shall do
any of the following:
(A) increase the Revolving Credit Commitment of any Lender or
subject any Lender to any additional obligations hereunder;
(B) except for changes permitted by Sections 2.7 or 2.10
hereof or changes made pursuant to an Assignment and Assumption Agreement,
change any Lender's Revolving Credit Commitment Percentage or the
aggregate or individual unpaid principal amount of any Lender's Revolving
Credit Note, or forgive the payment of the principal or interest payable
on any Lender's Revolving Credit Note;
(C) waive an Event of Default in the payment of principal
and/or interest due hereunder and under any of the Revolving Credit Notes;
(D) decrease the interest rate relating to the Revolving
Credit Loans;
(E) postpone any date fixed for any payment of principal of or
interest on the Revolving Credit Loans, the Commitment Fee, the Letter of
Credit Fee, or any other obligations of the Borrower set forth in Article
II;
(F) reduce the Commitment Fee or the Letter of Credit Fee; or
(G) amend the definition of the term "Required Lenders" or
amend or waive the provisions of this Section 9.1.
Any such amendment, extension, renewal, modification, supplement, replacement,
waiver or consent shall apply equally to the Borrower and each of the Lenders
and shall be binding upon the Borrower, the Lenders, the Agent and all future
holders of the Revolving Credit Notes. In the case of any waiver, the Borrower,
the Lenders and the Agent shall be restored to their former positions and
rights, and any Event of Default waived shall be deemed to be cured and not
continuing, but no such waiver shall extend to any subsequent or other Event of
Default, or impair any right consequent thereon.
- 60 -
9.2 EXPENSES. The Borrower shall pay:
(i) All reasonable costs and expenses of the Agent (including
without limitation the reasonable fees and disbursements of the Agent's
special counsel, Xxxxxxxx Xxxxxxxxx Professional Corporation, incurred in
connection with the preparation, negotiation, execution and delivery of
this Agreement and the other Loan Documents and any and all other
documents and instruments prepared in connection herewith, including but
not limited to all amendments, extensions, modifications, replacements,
waivers, consents and other documents and instruments prepared or entered
into from time to time; and
(ii) All reasonable costs and expenses of the Agent and the
Lenders (including without limitation the reasonable fees and
disbursements of the Agent's and the Lenders' counsels, which may be in
house counsel) in connection with (A) the enforcement of this Agreement
and the other Loan Documents arising pursuant to a breach by any Loan
Party of any of the terms, conditions, representations, warranties or
covenants of any Loan Document to which it is a party (including without
limitation the reasonable fees and expenses of any workout counsel for the
Agent and the Lenders), and (B) defending or prosecuting any actions,
suits or proceedings relating to any of the Loan Documents.
All of such costs and expenses shall be payable by the Borrower to the Lenders
or the Agent, as the case may be, upon demand or as otherwise agreed upon by the
Lenders or the Agent and the Borrower, and shall constitute Bank Indebtedness
under this Agreement. The Borrower further agrees to pay and save the Agent and
the Lenders harmless from any and all liability for, any stamp or other taxes
which may be payable with respect to the execution or delivery of this Agreement
or the issuance of the Revolving Credit Notes or of any Letters of Credit. The
Borrower's obligation to pay such costs and expenses shall survive the
termination of this Agreement and the repayment of the Bank Indebtedness.
9.3 NOTICES. Any notice, request, demand, direction or other communication (for
purposes of this Section 9.3 only, a "Notice") to be given to or made upon any
party hereto or any other Loan Document under any provision of this Agreement or
any other Loan Document shall be given or made by telephone or in writing (which
includes by means of electronic transmission (i.e., "e-mail") or facsimile
transmission or by setting forth such Notice on site the World Wide Web (a
"Website Posting") if Notice of such Website Posting (including the information
necessary to access such site) has previously been delivered to the applicable
parties hereto by another means set forth in this Section 9.3) in accordance
with this Section 9.3. Any such Notice must be delivered to the applicable
parties hereto at the addresses and numbers set forth below or in accordance
with any subsequent unrevoked Notice from any such party that is given in
accordance with this Section 9.3. Any Notice shall be effective:
(i) In the case of hand-delivery, when delivered;
- 61 -
(ii) If given by mail, four days after such Notice is
deposited with the United States Postal Service, certified or registered
mail postage prepaid, return receipt requested;
(iii) In the case of a telephonic Notice, when a party is
contacted by telephone, if delivery of such telephonic Notice is confirmed
no later than the next Business Day by hand-delivery, a facsimile or
electronic transmission, a Website Posting or an overnight courier
delivery of a confirmatory Notice (received before the close of business
on such next Business Day);
(iv) In the case of a facsimile transmission, when sent to the
applicable party's facsimile machine's telephone number, if the party
sending such Notice receives confirmation of the delivery thereof from its
own facsimile machine;
(v) In the case of electronic transmission, when actually
received;
(vi) In the case of a Website Posting, upon delivery of a
Notice of such posting (including the information necessary to access such
site) by another means set forth in this Section 9.3; and
(vii) If given by any other means (including by overnight
courier), when actually received.
Any Lender giving a Notice to the Borrower shall concurrently send a copy
thereof to the Agent, and the Agent shall promptly notify the other Lenders of
its receipt of such Notice.
9.3a NOTICE TO THE BORROWER.
NRP (Operating) LLC
000 Xxxxxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
0000 Xxxxx Xxxxxx
Xxxxx 000
P.O. Box 2827
Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
9.3b NOTICE TO THE AGENT.
- 62 -
PNC Bank, National Association
Agency Services
One PNC Plaza - 22nd Floor
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to:
PNC Bank, National Association
Energy, Metals and Mining Group
One PNC Plaza, 3rd Floor
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxxxxxxx Xxxxxxx
Senior Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
9.3c NOTICE TO THE LENDERS. All notices required to be delivered to the Lenders
pursuant to this Agreement shall be sent to the addresses set forth on the
signature pages of the Agreement or such Lender's signature page to the
Assignment and Assumption Agreement executed by it as a Purchasing Lender.
9.4 TAX WITHHOLDING. Each Lender or assignee or Participant of a Lender that is
not incorporated under the laws of the United States of America or a state
thereof (and, upon the written request of the Agent, each other Lender or
assignee or Participant of a Lender) agrees that it will deliver to each of the
Borrower and the Agent two (2) duly completed appropriate valid Withholding
Certificates (as defined under Section 1.1441-1 (c)(16) of the Income Tax
Regulations (the "Regulations")) certifying its status (i.e., United States or
foreign person) and, if appropriate, making a claim of reduced, or exemption
from, United States withholding tax on the basis of an income tax treaty or an
exemption provided by the Internal Revenue Code (the "Code"). Such delivery may
be made by electronic transmission as described in Section 1.1441- 1 (e)(4)(iv)
of the Regulations if the Agent establishes an electronic delivery system. The
term "Withholding Certificate" means a Form W-9, a Form W-8BEN, a Form W-8ECI, a
Form W- 8IMY and the related statements and certifications as required under
Section 1.1441-1(e)(3) of the Regulations, a statement described in Section
1.871-14(c)(2)(v) of the Regulations, or any other certificates under the Code
or Regulations that certify or establish the status of a payee or beneficial
owner as a United States or foreign person. Each Lender, assignee or Participant
required to deliver to the Borrower and the Agent a valid Withholding
Certificate pursuant to the preceding sentence shall deliver such valid
Withholding Certificate as follows; (A) each Lender which is a party hereto on
the Closing Date shall deliver such valid Withholding Certificate at least five
(5) Business Days prior to the first date on which any interest or Fees are
payable by the Borrower hereunder for the account of such Lender; (B) each
assignee or Participant shall
- 63 -
deliver such valid Withholding Certificate at least five (5) Business Days
before the effective date of such assignment or Participation (unless the Agent
in its sole discretion shall permit such assignee or Participant to deliver such
Withholding Certificate less than five (5) Business Days before such date in
which case it shall be due on the date specified by the Agent). Each Lender,
assignee or Participant which so delivers a valid Withholding Certificate
further undertakes to deliver to each of the Borrower and the Agent two (2)
additional copies of such Withholding Certificate (or a successor form) on or
before the date that such Withholding Certificate expires or becomes obsolete or
after the occurrence of any event requiring a change in the most recent
Withholding Certificate so delivered by it, and such amendments thereto or
extensions or renewals thereof as may be reasonably requested by the Borrower or
the Agent. Notwithstanding the submission of a Withholding Certificate claiming
a reduced rate of, or exemption from United States withholding taxes, the Agent
shall be entitled to withhold United States federal income taxes at the full 30%
withholding rate if in its reasonable judgment it is required to do so under the
due diligence requirements imposed upon a withholding agent under Section
1.1441-7(b) of the Regulations. Further, the Agent is indemnified under Section
1.1461-1(e) of the Regulations against any claims and demands of any Lender or
assignee or Participant of a Lender for the amount of any tax it deducts and
withholds in accordance with regulations under Section 1441 of the Internal
Revenue Code.
9.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Borrower,
the Agent and the Lenders and their respective successors and assigns, and shall
inure to the benefit of the Borrower, the Agent and the Lender and the
successors and assigns of the Agent and the Lender, provided, that the Borrower
shall not assign its rights or duties hereunder or under any of the other Loan
Documents without the prior written consent of the Lenders.
9.6 ASSIGNMENTS AND PARTICIPATIONS.
9.6a ASSIGNMENTS. Subject to the remaining provisions of this Subsection 9.6a,
any Lender (a "Transferor Lender"), at any time, in the ordinary course of its
commercial banking business and in accordance with applicable law, may sell to
one or more financial institutions (individually a "Purchasing Lender") a
portion or all of its rights and obligations under this Agreement and the
Revolving Credit Notes then held by it, pursuant to an Assignment and Assumption
Agreement substantially in the form of Exhibit "F" executed by the Transferor
Lender, such Purchasing Lender, the Borrower and the Agent; subject, however to
the following requirements:
(i) Each such assignment must be in a minimum amount of
$5,000,000, or, in excess thereof, in integral multiples of $1,000,000,
unless such Lender's Revolving Credit Commitment is less than $5,000,000,
in which case such assignment shall be in the full amount of such Lender's
Revolving Credit Commitment;:
(ii) During the first ninety (90) days following the Closing
Date, each assignment made shall become effective only on a date which
coincides with the expiration date of any Interest Period then in effect,
unless the Agent agrees to waive this provision;
- 64 -
(iii) The Agent and the Borrower must each give its prior
consent to any such assignment which consent shall not be unreasonably
withheld; it being agreed that it shall not be deemed unreasonable for the
Borrower to decline to consent to such assignment if (A) such assignment
would result in incurrence of additional costs to the Borrower under
Article II, or (B) the proposed assignee has not provided to the Borrower
any tax forms required under Section 9.4, provided, however, no consent is
required for the transfer by a Lender to its Affiliate or to another
Lender so long as the conditions in clauses (i) and (ii) immediately above
are satisfied; and
(iv) The Transferor Lender shall pay to the Agent a $3,500
service fee for each such transfer at the time of each such transfer;
provided, however the restrictions set forth in item (i) above shall not apply
(x) in the case of an assignment by a Lender to an Affiliate of such Lender or
(y) in the case of any assignment by any Transferor Lender upon the occurrence
and during the continuation of an Event of Default; and provided further, that
upon the occurrence and during the continuance of an Event of Default the
consent of the Borrower to any assignment is not required.
Upon the execution, delivery, acceptance and recording of any such Assignment
and Assumption Agreement, from and after the Transfer Effective Date determined
pursuant to such Assignment and Assumption Agreement, all parties hereto agree
that (a) the Purchasing Lender thereunder shall be a party hereto as a Lender
and, to the extent provided in such Assignment and Assumption Agreement, shall
have the rights and obligations of a Lender hereunder with the Revolving Credit
Commitments as set forth therein, and (b) the Transferor Lender thereunder
shall, to the extent provided in such Assignment and Assumption Agreement, be
released from its obligations as a Lender under this Agreement. Such Assignment
and Assumption Agreement shall be deemed to amend this Agreement (without
further action) to the extent, and only to the extent, necessary to reflect the
addition of such Purchasing Lender as a Lender and the resulting adjustment of
Revolving Credit Commitment Percentages arising from the purchase by such
Purchasing Lender of all or a portion of the rights and obligations of such
Transferor Lender under this Agreement and its Revolving Credit Notes. On or
prior to the Transfer Effective Date, the Borrower shall execute and deliver to
the Agent, in exchange for the surrendered Revolving Credit Notes held by the
Transferor Lender, new Revolving Credit Notes to the order of such Purchasing
Lender in amounts equal to the Revolving Credit Commitment or the Revolving
Credit Loans assumed by it and purchased by it pursuant to such Assignment and
Assumption Agreement, and new Revolving Credit Notes to the order of the
Transferor Lender in amounts equal to the Revolving Credit Commitment or the
Revolving Credit Loans retained by it hereunder, in each case dated as of the
date of the last payment in full of interest on the surrendered Revolving Credit
Notes.
In addition to the assignments permitted above, any Lender may assign and pledge
all or any portion of its Revolving Credit Loans and Revolving Credit Notes to
any Federal Reserve Bank as collateral security pursuant to Regulation A of the
Board of Governors of the Federal Reserve System and any Operating Circular
issued by such Federal Reserve Bank. No such assignment shall release the
assigning Lender from its obligations and duties hereunder.
- 65 -
9.6b ASSIGNMENT REGISTER. The Agent shall maintain, at its address referred to
in Subsection 9.3b, a copy of each Assignment and Assumption Agreement delivered
to it and a register (the "Register") for the recordation of the name, address
and Revolving Credit Commitment of each Lender and the amount of the Revolving
Credit Loans owing to each Lender from time to time. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Agent and the Lenders may treat each Person whose name is recorded in the
Register as the owner of the Revolving Credit Notes and the Revolving Credit
Loans and the holder of the Revolving Credit Commitment recorded therein for all
purposes of this Agreement and the other Loan Documents. The Register shall be
available at the office of the Agent set forth in Subsection 9.3b for inspection
by either Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice.
9.6c PARTICIPATIONs. Each Lender, in the ordinary course of its commercial
banking business and in accordance with applicable law, may sell to one or more
Participants a participating interest in any Revolving Credit Loan or Letter of
Credit owing to such Lender, the interest of such Lender in any Revolving Credit
Note, Letter of Credit or the Revolving Credit Commitment of such Lender. In the
event of any such sale by a Lender of a participating interest to a Participant,
such Lender's obligations under this Agreement to the other parties to this
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of its
Revolving Credit Notes for all purposes under this Agreement and the Borrower,
the other Lenders and the Agent shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under this
Agreement or its Revolving Credit Notes and the Participants shall have voting
rights only with respect to matters described in clauses (B), (D), (E) and (F)
of Section 9.1, but only with respect to the Revolving Credit Loans and
Revolving Credit Commitments in which such Participant participates.
9.6d PROVISIONS FOR SPECIAL PURPOSE FUNDING VEHICLES. Notwithstanding anything
to the contrary contained herein, any Lender (a "Granting Lender") may grant to
a special purpose funding vehicle (an "SPC") of such Granting Lender, identified
as such in writing from time to time by the Granting Lender to the Agent and the
Borrower, the option to provide to the Borrower all or any part of any Revolving
Credit Loan that such Granting Lender would otherwise be obligated to make to
the Borrowers; provided that (i) nothing herein shall constitute a commitment to
make any Revolving Credit Loan by such SPC and (ii) if an SPC elects not to
exercise such option or otherwise fails to provide all or any part of such
Revolving Credit Loan, the Granting Lender shall be obligated to make such
Revolving Credit Loan pursuant to the terms hereof. The making of a Revolving
Credit Loan by an SPC hereunder shall utilize the relevant Revolving Credit
Commitment of the Granting Lender to the same extent, and as if, such Revolving
Credit Loan were made by the Granting Lender. Each party hereto hereby agrees
that no SPC shall be liable for any payment under this Agreement for which a
Lender would otherwise be liable, for so long as, and to the extent, the related
Granting Lender makes such payment. In furtherance of the foregoing, each party
hereto hereby agrees that, prior to the date that is one year and one day after
the later of (i) the payment in full of all outstanding senior indebtedness of
such SPC and (ii) the Termination Date, it will not institute against, or join
any other person in instituting against such SPC any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or similar proceedings under
the laws of the United States
- 66 -
or any State thereof. In addition, notwithstanding anything to the contrary
contained in this Subsection 9.6d, such SPC may (i) with prior written consent
of the Borrower and the Agent (such consent not to be unreasonably withheld) and
without paying any processing fee therefor, assign all or a portion of its
interests in any Revolving Credit Loans to its Granting Lender or to any
financial institutions providing liquidity and or credit facilities to or for
the account of such SPC to fund the Revolving Credit Loans made by such SPC or
to support the securities (if any) issued by such SPC to fund such Revolving
Credit Loans and (ii) disclose on a confidential basis consistent with Section
9.19 any non-public information relating to its Revolving Credit Loans to any
rating agency, commercial paper dealer or provider of a surety, guarantee or
credit or liquidity enhancement to such SPC. In no event shall the Borrower be
obligated to pay an SPC that has made a Revolving Credit Loan in a greater
amount than the Borrower would have been obligated to pay under this Agreement
if the Granting Lender had made such Revolving Credit Loan. Each Granting Lender
shall indemnify and hold harmless the Borrower and its directors, officers,
employees and agents from and against any and all losses, liabilities, claims,
damages and expenses arising from or attributable to the making of a Revolving
Credit Loan by an SPC of such Granting Lender.
9.7 SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining portions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
9.8 SURVIVAL. All representations, warranties, covenants and agreements of the
Borrower contained herein, in the Revolving Credit Notes or in the other Loan
Documents or made in writing in connection herewith or therewith shall survive
the issuance of the Revolving Credit Notes and the Letters of Credit and shall
continue in full force and effect so long as the Borrower may borrow hereunder
and so long thereafter until payment in full of all the Revolving Credit Notes
and the Bank Indebtedness. Notwithstanding the terms of the foregoing sentence,
the representations, warranties, covenants, agreements and indemnities set forth
in Sections 2.6i, 4.13, 8.7, 9.4, 9.16 and 9.18 shall survive the termination of
the Revolving Credit Commitments hereunder and the payment in full of the
Revolving Credit Notes and the Bank Indebtedness.
9.9 GOVERNING LAW. This Agreement, each Revolving Credit Note and each other
Loan Document shall be a contract made under, governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania without reference
to the provision thereof regarding conflicts of law except where such law is
superseded by applicable Federal law.
9.10 NON-BUSINESS DAYS. Except as otherwise specifically required pursuant to
the terms of this Agreement, whenever any payment hereunder or under the
Revolving Credit Notes is due and payable on a day which is not a Business Day,
such payment may be made on the next succeeding Business Day.
9.11 INTEGRATION. This Agreement constitutes the entire agreement between the
parties relating to this financing transaction and it supersedes all prior
understandings and agreements, whether written or oral, between the parties
hereto concerning the subject matter of this Agreement.
- 67 -
9.12 HEADINGS, ETC.. Article, Section and other headings and Section and
Subsection references used in this Agreement are intended for convenience only
and shall not, and are not intended to, in any way or manner affect the meaning
or construction of this Agreement.
9.13 SET-OFF. The Borrower hereby grants to the Lenders a lien and security
interest for the amount of any Bank Indebtedness upon and in any property,
credits, securities or money of the Borrower which may at any time be delivered
to, or be in the possession of, or owed by any Lender in any capacity whatever,
including the balance of any deposit account but excluding any trust or
fiduciary accounts, in each case maintained by the Borrower with such Lender.
The Borrower hereby authorizes each Lender in case of an Event of Default, at
such Lender's option, at any time and from time to time, to apply, at the
discretion of such Lender, to the payment of Bank Indebtedness, any and all such
property, credits, securities or money now or hereafter in the hands of such
Lender belonging or owed to the Borrower. Nothing herein shall restrict any
Lender's ability to set off any property, credits, securities or money of the
Borrower which may at any time be delivered to, or be in possession or owed to
any Lender in any capacity whatever to satisfy an independent obligation of the
Borrower to the Lender.
9.14 CONSENT TO FORUM. The parties hereto each hereby irrevocably consents to
the exclusive jurisdiction of the Court of Common Pleas of Allegheny County,
Pennsylvania, or in the District Court of the United States for the Western
District of Pennsylvania in any action or proceeding arising out of or relating
to this Agreement, the Revolving Credit Notes or the other Loan Documents, and
each party, agrees that a summons and complaint commencing an action or
proceeding in either of such courts shall be properly served and shall confer
personal jurisdiction if served personally or by certified mail to the party, at
its respective address set forth in Section 9.3, or as otherwise provided under
the laws of the Commonwealth of Pennsylvania. Further, the parties hereby
specifically waive and hereby acknowledge that the parties are estopped from
raising any claim that any such court lacks personal jurisdiction over such
party so as to prohibit either such court from adjudicating any issues raised in
a complaint filed with any such court against the Borrower or the Lenders
concerning this Agreement, the Revolving Credit Notes or the other Loan
Documents.
9.15 WAIVER OF JURY TRIAL. Each of the Agent, the Lenders and the Borrower
hereby knowingly, voluntarily and intentionally waive any rights they may have
to a trial by jury in respect of any litigation based hereon, or arising out of,
under, or in connection with, this Agreement or any other Loan Document, or any
course of conduct, course of dealing, statements (whether verbal or written) or
actions of the Agent, the Lenders or the Borrower relating hereto or thereto.
The Borrower acknowledges and agrees that it has received full and sufficient
consideration for this provision (and each other provision of each other Loan
Document to which it is a party) and that this provision is a material
inducement for the Lenders to enter into this Agreement and each such other Loan
Document.
9.16 INDEMNITY. The Borrower hereby agrees to indemnify the Agent, the Lenders
and each of their respective directors, officers, employees, attorneys, agents
and Affiliates against, and hold each of them harmless from, any loss,
liabilities, damages, claims, and reasonable costs and expenses, joint or
several (including reasonable attorneys' fees and disbursements reasonably
incurred by any such Person in connection with the preparation for or defense of
any pending or
- 68 -
threatened claim, action or proceeding) suffered or incurred by any of them
under any applicable federal or state law or otherwise caused by, arising out
of, resulting from or in any manner connected with the execution, delivery and
performance of each of the Loan Documents, the Revolving Credit Loans and any
and all transactions related to or consummated in connection with the Revolving
Credit Loans. The indemnity set forth in this Section 9.16 shall be in addition
to any other obligations or liabilities of the Borrower to the Agents or the
Lenders, or at common law or otherwise. The provisions of this Section 9.16
shall survive the payment of the Bank Indebtedness and the termination of this
Agreement. The foregoing provisions of this Section 9.16 to the contrary
notwithstanding, the Borrower shall not be obligated to indemnify the Agent or
any Lender pursuant to this Section 9.16 for (i) any losses, liabilities,
damages, claims or costs suffered or incurred by any of them in connection with
the administrative transfer of funds in connection with this Agreement and which
arise directly from the Agent's or such Lender's gross negligence or willful
misconduct, or (ii) any other losses, liabilities, damages, claims, or costs
which arise directly from the Agent's, or such Lender's gross negligence or
willful misconduct. All amounts owed pursuant to this Section 9.16 shall be part
of the Bank Indebtedness.
9.17 COUNTERPARTS. This Agreement and any amendment, modification, extension or
renewal hereto or hereof may be executed in several counterparts and by each
party on a separate counterpart, each of which, when so executed and delivered,
shall be an original, but all of which together shall constitute but one and the
same instrument. In proving this Agreement or any amendment, modification,
extension or renewal, it shall not be necessary to produce or account for more
than one such counterpart signed by the other party against whom enforcement is
sought.
9.18 LIMITATION ON RECOURSE TO GENERAL PARTNER. Except as set forth below, the
Agent and the Lenders shall not look to the General Partner for the payment of
the Bank Indebtedness and the performance of the Borrower's (or the Parent's)
other obligations hereunder and under the other Loan Documents; provided,
however, that the Agent and the Lenders shall have the right to look to the
General Partner on a joint and several basis for, and the General Partner on a
joint and several basis shall indemnify, and hold harmless, the Agent and the
Lenders from, any loss, damage, liability, claim, cost or expense (including
reasonable attorneys' fees) which the Agent or any Lender may incur as a result
of and to the extent caused by (i) any representation or warranty made by the
Parent, the Borrower, any Guarantor or the General Partner herein or in any
other Loan Document or in any, certificate, schedule, statement, report, notice
or other writing furnished or made to the Agent or the Lenders in connection
with the transactions contemplated by this Agreement is untrue in any material
respect, or (ii) any assets, rights, rents, profits, issues, income or other
properties or revenues of the Parent, the Borrower or any of its Subsidiaries
are misappropriated by the General Partner and the Agent or any Lender sustains
a loss therefrom.
9.19 CONFIDENTIALITY. Each of the Agent and each Lender agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its, its affiliates and its affiliates' directors,
officers, employees and agents, including accountants, legal counsel and other
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed
- 69 -
to keep such Information confidential), (b) to the extent requested by any
regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section,
to any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement, (g) with
the consent of Borrower or (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section by any
Person or (ii) becomes available to the Agent or any Lender on a nonconfidential
basis from a source other than Borrower or any of its Subsidiaries. For the
purposes of this Section, "Information" means all information received from
Borrower or its Subsidiaries relating to Borrower and its Subsidiaries or their
business, other than any such information that is available to the Agent or any
Lender on a nonconfidential basis prior to disclosure by Borrower or any of its
Subsidiaries; provided that, in the case of information received from Borrower
after the date of this Agreement, such information is clearly identified at the
time of delivery as confidential. Any, Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
- 70 -
[SIGNATURE PAGE 1 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
NRP (OPERATING) LLC, a Delaware limited
liability company
By: Natural Resource Partners L.P., a Delaware
limited partnership, its sole member
By: NRP (GP) LP, a Delaware limited
partnership, its general member
By: GP Natural Resource Partners LLC,
a Delaware limited liability company,
its general member
By: /s/ Xxxx Xxxxxx (SEAL)
-----------------------------
Name: Xxxx Xxxxxx
Title: President and COO
[SIGNATURE PAGE 2 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
PNC BANK, NATIONAL ASSOCIATION,
Revolving Credit Commitment: individually and as Administrative Agent
$21,250,000
Revolving Credit Commitment By: /s/ Xxxxxxxxxxx X. Xxxxxxx
21.25% -------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Senior Vice President
Addresses for notice purposes:
PNC Bank, National Association
Agency Services
One PNC Plaza - 22nd Floor
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
With a copy to:
PNC Bank, National Association
Energy Metals and Mining Group
Xxx XXX Xxxxx - 0xx Xxxxx
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxxxxxxx Xxxxxxx,
Senior Vice President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
Address for Euro-Rate Loan Funding if different from above:
N/A
------------------------------
------------------------------
------------------------------
Telephone:
-------------------
Telecopier:
-------------------
Telex:
------------------------
[SIGNATURE PAGE 3 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
BRANCH BANKING AND TRUST COMPANY,
Revolving Credit Commitment: individually and as Syndication Agent
$21,250,000
Revolving Credit Commitment By: /s/ Xxxxx X. Xxxxxxxxx
21.25% ---------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Vice President
Addresses for notice purposes:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
--------------------------------
With a copy to:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
--------------------------------
Address for Euro-Rate Loan Funding if different from above:
N/A
------------------------------
------------------------------
------------------------------
Telephone:
--------------------
Telecopier:
-------------------
Telex:
------------------------
[SIGNATURE PAGE 4 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
BANK OF MONTREAL, individually and as
Revolving Credit Commitment: Documentation Agent
$21,250,000
Revolving Credit Commitment By: /s/ Xxxxx X. Xxxxxx
21.25% -------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
Addresses for notice purposes:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
-------------------------------
With a copy to:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
-------------------------------
Address for Euro-Rate Loan Funding if different from above:
N/A
------------------------------
------------------------------
------------------------------
Telephone:
--------------------
Telecopier:
-------------------
Telex:
------------------------
[SIGNATURE PAGE 5 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
BNP PARIBAS, individually and as
Revolving Credit Commitment: Documentation Agent
$21,250,000
Revolving Credit Commitment By: /s/ Xxxxx X. Xxxxx
21.25% -------------------------------------
Name: Xxxxx X. Xxxxx
Title: Director
By: /s/ Xxxx Xxxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxxx
Title: Vice President
Addresses for notice purposes:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
--------------------------------
With a copy to:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
Attention:
--------------------------------
Telephone:
--------------------------------
Telecopier:
--------------------------------
Address for Euro-Rate Loan Funding if different from above:
N/A
------------------------------
------------------------------
------------------------------
Telephone:
--------------------
Telecopier:
--------------------
Telex:
------------------------
[SIGNATURE PAGE 6 OF 6 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, intending to be legally bound hereby, the undersigned
have caused this Credit Agreement by and among NRP (OPERATING) LLC, THE LENDERS
PARTY HERETO, PNC BANK, NATIONAL ASSOCIATION, as the Administrative Agent,
BRANCH BANKING AND TRUST COMPANY, as Syndication Agent and BANK OF MONTREAL and
BNP PARIBAS, as Documentation Agents, to be executed by their respective duly
authorized officer as of the date first written above.
Revolving Credit Commitment: THE HUNTINGTON NATIONAL BANK
$15,000,000
Revolving Credit Commitment By: /s/ Xxxx X. Xxxxxx
15% -------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
Addresses for notice purposes:
Huntington National Bank
Huntington Center
00 X. Xxxx Xxxxxx XX0000
Xxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxx
Telephone: 000-000-0000
Telecopier: 000-000-0000
With a copy to:
L. Xxxxx XxXxx
Vice President
Huntington National Bank
Xxx Xxxxxxxxxx Xxxxxx XX0000
Xxxxxxxxxx, XX
Attention:
--------------------------------
Telephone: 000-000-0000
Telecopier: 000-000-0000
Address for Euro-Rate Loan Funding if different from above:
N/A
------------------------------
------------------------------
------------------------------
Telephone:
--------------------
Telecopier:
-------------------
Telex:
------------------------
