FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND WAIVER
Exhibit
10.1
EXECUTION
VERSION
FIRST AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT
AND
WAIVER
This
FIRST AMENDMENT TO AMENDED AND
RESTATED CREDIT AGREEMENT AND WAIVER (this “Amendment”), dated as of
January 14, 2009, among RENTECH ENERGY MIDWEST CORPORATION, a Delaware
corporation (“Borrower”), RENTECH, INC., a
Colorado corporation (“Holdings”), the Lenders and
the Agents (each as defined below) is entered into in connection with the Credit
Agreement referred to in the first recital below.
RECITALS
WHEREAS,
Borrower and Holdings are parties to that certain Amended and Restated Credit
Agreement, dated as of June 13, 2008 (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”; unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement), among Borrower,
Holdings, the banks, financial institutions and other entities party to the
Credit Agreement as lenders (the “Lenders”), Credit Suisse,
Cayman Islands Branch, as administrative agent (in such capacity, the “Administrative Agent”) and as
collateral agent (in such capacity, the “Collateral
Agent”);
WHEREAS, as of the date hereof,
Borrower has requested from Administrative Agent certain amendments and waivers
with respect to, inter
alia, (i) the mandatory prepayment requirements under Section 2.10(a) of
the Credit Agreement and (ii) the Minimum Liquidity Threshold requirement under
Section 6.16 of the Credit Agreement.
WHEREAS,
the Lenders and Agents have agreed to amend and waive certain provisions under
the Credit Agreement to the extent set forth herein and subject to the terms and
conditions set forth in this Amendment.
NOW, THEREFORE, in
consideration of the premises made hereunder, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as
follows:
Section
1. Amendment of Section 1.01 of
the Credit Agreement. Section 1.01 of the Credit Agreement is
hereby amended by amending and restating the following definitions:
“Applicable
Margin” shall
mean, for any day with respect to any Loan, (a) accruing interest at the
Alternate Base Rate, 9.0% per annum, or (b) accruing interest at the Adjusted
LIBO Rate, 10.0% per annum.
“Cash
Outlay” shall
have the meaning assigned to such term in Section 2.10(a).
“Deferral
Facility” shall
have the meaning assigned to such term in Section 2.10(f).
“Deferral Interest
Rate” shall have
the meaning assigned to such term in Section 2.10(f).
“Fee
Letter” shall mean, collectively, each of the Fee Letters dated May 30,
2008, June 13, 2008, and January 14 , 2009 (the “January 2009 Fee
Letter”) among the Borrower, the Administrative Agent, and an affiliate
of the Administrative Agent.
“First Amendment
Effective Date”
shall mean January 14 , 2009, the date on which the First Amendment to
Amended and Restated Credit Agreement and Waiver became effective.
Section
2. Amendment of Section 2.10
and Section 5.13 of the Credit Agreement. Section 2.10 and
Section 5.13 of the Credit Agreement are hereby amended as follows:
(a) Section
2.10(a) of the Credit Agreement is hereby amended and restated as
follows:
(a) In
the event that Borrower shall make a distribution (including for purposes of
payments under the Management Agreement) to any holder of Equity Interests of
Borrower (other than any Permitted Distributions/Loans and payments permitted
under Sections 6.06(a)(ii) and (iii)) or an intercompany loan to, or other
Investment in, Holdings or any other Subsidiary, concurrently with such
distribution, intercompany loan or other Investment by Borrower (each, a “Cash
Outlay”), the Borrower shall deliver, or cause to be delivered, to
Lenders, subject to the provisions of Section 2.10(f), an amount to prepay
outstanding Loans in accordance with Section 2.10(e) as follows (provided,
that such Cash Outlays may only be made in compliance with Section 6.04 and
Section 6.06):
(i)
beginning and including December 23, 2008, on the first $22,000,000 in aggregate
Cash Outlays, an amount equal to 25% of the amount of each such Cash Outlay to
prepay outstanding Loans in accordance with Section 2.10(e);
(ii)
through and including September 30, 2009, on all Cash Outlays above the
$22,000,000 in aggregate Cash Outlays referenced in subsection (i), an amount
equal to 75% of the amount of each such Cash Outlay to prepay outstanding Loans
in accordance with Section 2.10(e); and
(iii)
beginning and including October 1, 2009, on all Cash Outlays, an amount equal to
the amount of such Cash Outlay to prepay outstanding Loans in accordance with
Section 2.10(e).
(b) Section
2.10(e) of the Credit Agreement is hereby amended and restated as
follows:
(e) The
Borrower shall deliver to the Administrative Agent, at the time of each
prepayment required under this Section 2.10 or any voluntary prepayment
under Section 2.10(f), (i) a certificate signed by a Financial Officer of the
Borrower, setting forth in reasonable detail the calculation of the amount of
such prepayment, including, to the extent applicable, all accrued and unpaid
interest under subsection (f) herein; and (ii) to the extent practicable, at
least three Business Days prior written notice of such prepayment. Each notice
of prepayment shall specify the prepayment date and the principal amount of each
Loan (or portion thereof) to be prepaid. All prepayments of Loans under this
Section 2.10 shall be accompanied by (i) accrued and unpaid interest (at
the Deferral Interest Rate, if applicable) on the principal amount to be prepaid
to but excluding the date of payment and (ii) the applicable Payment
Premium. In the event of a prepayment made under subsections
2.10(a)(i) or 2.10(a)(ii), the certificate signed by a Financial Officer of the
Borrower shall also set forth: (i) the amount of the corresponding
Cash Outlay, (ii) the amount of the aggregate Cash Outlays to date from December
23, 2008, and (iii) that such Cash Outlay shall only be used to fund the
business plan of Holdings.
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(c) Section
2.10(f) is hereby amended and restated as Section 2.10(g) and the following
subsection (f) is hereby added to Section 2.10 of the Credit
Agreement:
(f) Beginning
and including February 1, 2009, Borrower may defer matching prepayments required
under Section 2.10(a) up to an outstanding principal aggregate amount of
$5,000,000 (the “Deferral
Facility”) through April 30, 2009 at which time the outstanding balance
of the Deferral Facility shall be paid. Borrower may make voluntary
prepayments (no more frequently than weekly) and re-incur the amount of the
Deferral Facility during the above three-month period provided, that at no time
shall the aggregate outstanding principal amount of the Deferral Facility exceed
$5,000,000. All outstanding balances on the Deferral Facility shall
bear interest (computed on the basis of the actual number of days elapsed over a
year of 360 days) at a rate per annum equal to the Adjusted LIBO Rate plus the
Applicable Margin plus an additional 2.0% per annum (the “Deferral Interest
Rate”). In order to exercise the Deferral Facility, the
Borrower shall deliver to the Administrative Agent, at least three Business Days
prior written notice of such exercise, which notice of exercise shall specify
the date the related Cash Outlay is to be made and the amount of the prepayment
otherwise required in connection with the Cash Outlay which is being
deferred. The calculation of the Deferral Interest Rate shall be
subject to the provisions of Section 2.20.
(d) Section
5.13 is hereby amended by adding the following sentences to the end of that
section:
Not more
than 10 days after the earlier of (i) notice thereof from one of more of the
Lenders to Holdings and (ii) knowledge thereof of Holdings, that the aggregate
amount of the outstanding shares of common stock of Holdings was greater
than 166,445,972 as of the First Amendment Effective Date, Holdings shall
deliver incremental warrants, on substantially the same terms as the warrants
dated the First Amendment Effective Date, to the Lenders or their designees and
permitted assigns exercisable for such number of shares of common stock as
necessary for the Lenders or their designees or permitted assigns, as
applicable, to hold warrants exercisable for shares of common stock that, in the
aggregate, equal 3% of the actual aggregate number of shares of common stock
outstanding as of the First Amendment Effective Date. Until the
incremental warrants are delivered in accordance with the preceding sentence,
Borrower shall not be permitted to make any Cash Outlays.
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Section
3. Amendment of Section 6.04
and Section 6.06 of the Credit Agreement. Section 6.04 and
Section 6.06 of the Credit Agreement are hereby amended by adding the following
provision to the end of each section:
Notwithstanding
Section 5.08 or anything else to the contrary herein, from the First Amendment
Effective Date, all distributions (including for purposes of payments under the
Management Agreement) made by the Borrower to any holder of Equity Interests of
Borrower (other than any Permitted Distributions/Loans and payments permitted
under Sections 6.06(a)(ii) and (iii)), and all intercompany loans to, or other
Investments in, Holdings or any other Subsidiary made by Borrower, constituting
the aggregate Cash Outlays referenced in Section 2.10(a), may only be made by
Borrower no more frequently than weekly. Furthermore, all Cash
Outlays referenced in subsections 2.10(a)(i) and 2.10(a)(ii), may only be used
to fund the business plan of Holdings.
Section
4. Amendment of Section 6.16 of
the Credit Agreement. Section 6.16 of the Credit Agreement is
hereby amended and restated as follows:
Section
6.16 Minimum Liquidity
Threshold. At all times after the Closing Date Borrower shall
maintain an amount of unencumbered (other than pursuant to the Security
Documents) cash on deposit (or in Permitted Investments) on any day including
the Maturity Date of at least $7,500,000 (the “Minimum Liquidity
Threshold”); provided however that solely during the months of February
through and including April of any fiscal year, the Minimum Liquidity Threshold
for the Borrower shall be $5,000,000.
Section
5. Conditions
Precedent. This Amendment shall become effective upon
satisfaction of each of the following conditions precedent:
(a) The
Administrative Agent shall have received originals of this Amendment duly
executed by each of the Agents, the Loan Parties, and the Lenders.
(b) The
Administrative Agent shall have received originals of (i) one or more Warrants,
dated as of the date hereof (together, the “Warrants”),
issued by Holdings to each of the Lenders or such Lender’s designated affiliate
(each, a “Warrant
Holder” and together, the “Warrant
Holders”) in the form attached hereto as Exhibit A and (ii)
the January 2009 Fee Letter duly executed by the parties thereto. In
addition, Holdings shall have received $49,933.79 in cash from the Warrant
Holders as the aggregate cash consideration for the Warrants.
(c) The
Administrative Agent shall have received originals of a promissory note and
allonge in accordance with Section 6.04(c) of the Credit Agreement evidencing
the intercompany loans made by Borrower to Holdings on December 29, 2008 and
January 5, 2009 as permitted by the Limited Waiver Letter (as hereinafter
defined).
(d) The
Administrative Agent shall have received, on behalf of the Warrant
Holders, favorable written opinions of (i) Xxxxxx & Xxxxxxx LLP,
counsel for Holdings, in form and substance satisfactory to the Warrant Holders
and (ii) Holland & Xxxx LLP, local counsel for Holdings, in form and
substance satisfactory to the Warrant Holders, in each
case, (A) dated the date of this Amendment (the “Amendment Closing
Date”), (B)
addressed to the Warrant Holders, and (C) covering such matters relating to the
Warrants as the Warrant Holders shall reasonably request, and Holdings and the
Borrower hereby request such counsel to deliver such opinions.
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(e) The
Administrative Agent shall have received, on behalf of the Warrant Holders
(i) a copy of the articles of incorporation, including all amendments
thereto, of Holdings, certified as of a recent date by the Secretary of State of
the state of its organization, or, if there has been no change in such document
since the Closing Date, a certificate of the Secretary or other appropriate
officer acceptable to the Warrant Holders of Holdings to that effect, and a
certificate as to the good standing of Holdings as of a recent date, from such
Secretary of State; (ii) a certificate of the Secretary or Assistant
Secretary of Holdings dated the Amendment Closing Date and certifying
(A) that attached thereto is a true and complete copy of the by-laws of
Holdings as in effect on the Amendment Closing Date and at all times since a
date prior to the date of the resolutions described in clause (B) below,
or, if there has been no change in such document since the Closing Date, a
statement to that effect, (B) that attached thereto is a true and complete
copy of resolutions duly adopted by the Board of Directors of Holdings
authorizing the execution, delivery and performance of the Warrants to which
such Person is a party, and that such resolutions have not been modified,
rescinded or amended and are in full force and effect, (C) that the
articles of incorporation of Holdings have not been amended since the date of
the last amendment thereto shown on the certificate of good standing furnished
pursuant to clause (i) above, and (D) as to the incumbency and
specimen signature of each officer executing the Warrants or any other document
delivered in connection therewith on behalf of Holdings; (iii) a
certificate of another officer as to the incumbency and specimen signature of
the Secretary or Assistant Secretary executing the certificate pursuant to
clause (ii) above and (iv) such other documents as the Warrant Holders may
reasonably request.
(f) The
representations and warranties contained herein shall be true and correct in all
material respects, as of the date hereof as if made on the date
hereof.
(g) No
Default or Event of Default shall have occurred and be continuing after giving
effect to this Amendment, except with respect to the delivery of (i) the
compliance certificates relating to financial statements for the fiscal year end
September 30, 2008 and month end November 30, 2008, pursuant to Section 5.04(d)
of the Credit Agreement; (ii) the accounting firm certificate relating to the
fiscal year end September 30, 2008 certifying that no Event of Default or
Default has occurred, with respect to Sections 6.10 and 6.11 or, if such an
Event of Default or Default has occurred, specifying the extent thereof in
reasonable detail, pursuant to Section 5.04(e) of the Credit Agreement; and
(iii) the final budget (including a projected consolidated balance sheet and
related statements of projected operations and cash flows for the fiscal year
end September 30, 2009) pursuant to Section 5.04(f) (where (i), (ii) and (iii)
are collectively referred to herein as the “Financial Deliverables”),
each of which shall be delivered within 10 days after the Amendment Closing
Date.
(h) The
Administrative Agent shall have received a certificate, dated
the Amendment Closing Date and signed by a Financial Officer of the
Borrower, confirming compliance with the conditions precedent set forth in
paragraphs (f) and (g) of this Section 5.
(i) except
as provided for in Section 14 of this Amendment, Borrower shall have paid all
Fees due and payable on the First Amendment Effective Date and other amounts
incurred in connection with the preparation, execution and delivery of this
Amendment and the Limited Waiver Letter, on or prior to the date of this
Amendment, including all reasonable fees and expenses of Proskauer Rose LLP,
and, to the extent invoiced, reimbursement or payment of all reasonable
out-of-pocket expenses required to be reimbursed or paid by the
Borrower.
Section
6. Representations and
Warranties. Each of Holdings and the Borrower hereby
represents and warrants to the Agents and the Lenders that, as of the date
hereof and after giving effect to this Amendment, (a) all representations and
warranties set forth in the Credit Agreement and in any other Loan Document are
true and correct in all material respects as if made again on and as of such
date (except those, if any, which by their terms specifically relate only to an
earlier date, in which case such representations and warranties shall have been
true and correct in all material respects as of such earlier date), (b) no
Default or Event of Default has occurred and is continuing except with respect
to the delivery of the Financial Deliverables, each of which shall be delivered
within 10 days after the Amendment Closing Date (c) as to Holdings,
the aggregate amount of the outstanding shares of common stock of
Holdings is 166,445,972, and (d) the Credit Agreement (as amended by this
Amendment), and all other Loan Documents are and remain legal, valid, binding
and enforceable obligations of the Loan Parties in accordance with the terms
thereof except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by equitable principles (regardless of whether enforcement is sought in
equity or at law).
5
Section
7. Survival of Representations
and Warranties. All representations and warranties made in
this Amendment or any other Loan Document shall survive the execution and
delivery of this Amendment, and no investigation by any Agent or any Lender
shall affect the representations and warranties or the right of the Agents and
the Lenders to rely upon them.
Section
8. Reference to
Agreement. Each of the Loan Documents, including the Credit
Agreement, and any and all other agreements, documents or instruments now or
hereafter executed and/or delivered pursuant to the terms hereof or pursuant to
the terms of the Credit Agreement as amended hereby, are hereby amended so that
any reference in such Loan Documents to the Credit Agreement, whether direct or
indirect, shall mean a reference to the Credit Agreement as amended
hereby. This Amendment shall constitute a Loan Document under the
Credit Agreement.
Section
9. Governing
Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION.
Section
10. Execution. This
Amendment may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement. Delivery of an executed counterpart of a signature
page to this Amendment by telecopier or electronic transmission shall be
effective as delivery of a manually executed counterpart of this
Amendment.
Section
11. Waivers.
(a) The
Agents and Lenders hereby permanently waive the 100% mandatory prepayment
requirements under Section 2.10(a) of the Credit Agreement (prior to the
effectiveness of this Amendment) that were temporarily granted under the limited
waiver letter dated as of December 30, 2008 among the Borrower, Holdings, the
Lenders, and the Agents (the “Limited Waiver
Letter”) solely
with respect to the December/January Intercompany Loans (as defined
therein).
(b) The
Agents and Lenders hereby temporarily waive the existing Defaults arising in
connection with the Borrower’s non-delivery of the Financial Deliverables when
due, until 10 days after the Amendment Closing Date provided, that during such
time (until the waivers become permanent in accordance with the following
sentence) the Borrower may only make intercompany loans to Holdings up to an
aggregate amount of $5,000,000 (including the scheduled intercompany loan of
$2,500,000 to be made immediately upon the effectiveness of this
Amendment). Upon delivery of such Financial Deliverables in
accordance with Section 14 herein, such temporary waivers shall become permanent
waivers without any further action from the parties hereto.
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Section
12. Limited
Effect. This Amendment relates only to the specific matters
expressly covered herein, shall not be considered to be a waiver (except as
expressly covered in Section 11) of any rights or remedies any Agent or Lender
may have under the Credit Agreement or under any other Loan Document, and shall
not be considered to create a course of dealing or to otherwise obligate in any
respect any Agent or Lender to execute similar or other amendments or grant any
waivers under the same or similar or other circumstances in the
future.
Section
13. Ratification by Subsidiary
Guarantors. Each Subsidiary Guarantor acknowledges that its
consent to this Amendment is not required, but each Subsidiary Guarantor
nevertheless hereby agrees and consents to this Amendment and to the documents
and agreements referred to herein. Each Subsidiary Guarantor agrees
and acknowledges that (i) notwithstanding the effectiveness of this Amendment,
such Subsidiary Guarantor’s Guarantee shall remain in full force and effect
without modification thereto and (ii) nothing herein shall in any way limit any
of the terms or provisions of any Subsidiary Guarantor’s Guarantee or any other
Loan Document executed by any Subsidiary Guarantor (as the same may be amended,
amended and restated, supplemented or otherwise modified from time to time), all
of which are hereby ratified, confirmed and affirmed in all
respects. Each Subsidiary Guarantor hereby agrees and acknowledges
that no other agreement, instrument, consent or document shall be required to
give effect to this Section
13. Each Subsidiary Guarantor hereby further acknowledges that
the Borrower, Holdings, the Agents and any Lender may from time to time enter
into any further amendments, modifications, terminations and/or waivers of any
provisions of the Loan Documents without notice to or consent from any
Subsidiary Guarantor and without affecting the validity or enforceability of any
Subsidiary Guarantor’s Guarantee or giving rise to any reduction, limitation,
impairment, discharge or termination of any Subsidiary Guarantor’s
Guarantee.
Section
14. Post Closing
Covenants. At Borrower’s cost and expense, Borrower shall,
without limiting and notwithstanding any other provision of any Loan
Document:
(a)
execute and deliver, or cause to be executed and delivered, the Financial
Deliverables, within 10 days after the Amendment Closing Date;
(b) pay
all reasonable fees and expenses of Proskauer Rose LLP related to this
Amendment, to the extent invoiced with reasonably detailed back-up, within ten
days of the Borrower’s receipt of such invoice; and
(c) pay
all reasonable out-of-pocket expenses of Credit Suisse related to this
Amendment, to the extent invoiced with reasonably detailed back-up, within ten
days of the Borrower’s receipt of such invoice.
In case
of the Borrower’s default in the due observance or performance of either of the
above covenants, there shall be an immediate Event of Default under the Credit
Agreement and the Agents and the Lenders shall be entitled to all rights and
remedies thereunder and under the other Loan Documents.
[signature pages
follow]
7
IN
WITNESS WHEREOF, the parties hereto have caused this First Amendment to Credit
Agreement and Waiver to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
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RENTECH
ENERGY MIDWEST CORPORATION,
as
Borrower
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| By: /s/ Xxx X. Xxxxx | |
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Name: Xxx X.
Xxxxx
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Title: VP &
Treasurer
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RENTECH,
INC.,
as
Holdings
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| By: /s/ Xxx X. Xxxxx | |
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Name: Xxx X.
Xxxxx
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Title: EVP
& CFO
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[Signature Pages to First
Amendment to Amended and Restated Credit Agreement and Waiver]
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CREDIT
SUISSE, CAYMAN ISLANDS BRANCH,
as
Administrative Agent and Collateral Agent
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By: /s/ Xxxxxxx
Xxxxx
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Name: Xxxxxxx
Xxxxx
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Title: Director
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By: /s/ Xxxxx
Xxxxx
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Name: Xxxxx
Xxxxx
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Title:
Associate
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CREDIT
SUISSE LOAN FUNDING LLC,
as
Lender
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By: /s/
Xxx Xxxxx
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Name: Xxx
Xxxxx
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Title: Authorized
Signatory
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By: /s/
Xxxxxxxxxx Xxxx
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Name: Xxxxxxxxxx
Xxxx
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Title: Authorized
Signatory
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BLT II
LLC,
as
Lender
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By: /s/ Xxxxxx
Xxxxxx
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Name: Xxxxxx
Xxxxxx
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Title: Authorized
Signatory
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SOLUS
CORE OPPORTUNITY MASTER FUND LTD.,
as
Lender
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By: /s/
illegible
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Name:
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Title:
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[Signature Pages to First
Amendment to Amended and Restated Credit Agreement and Waiver]
AGREEMENT
AND CONSENT OF SUBSIDIARY GUARANTORS
In
accordance with Section 13 herein the amendments set forth herein are agreed and
consented to by each of the below named Subsidiary Guarantors and each such
Subsidiary Guarantor affirms the obligations of such Subsidiary Guarantor under
the Guarantee and Collateral Agreement.
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RENTECH
DEVELOPMENT CORPORATION,
as
Subsidiary Guarantor
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| By: /s/ Xxx X. Xxxxx | |
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Name: Xxx X.
Xxxxx
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Title: CFO,
EVP & Treasurer
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RENTECH
SERVICES CORPORATION,
as
Subsidiary Guarantor
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| By: /s/ Xxx X. Xxxxx | |
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Name: Xxx
X. Xxxxx
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Title: CFO, EVP
& Treasurer
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RENTECH
ENERGY TECHNOLOGY CENTER, LLC,
as
Subsidiary Guarantor
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| By: /s/ Xxx X. Xxxxx | |
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Name: Xxx X.
Xxxxx
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Title: CFO, EVP
& Treasurer
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[Signature Pages to First
Amendment to Amended and Restated Credit Agreement and Waiver]
EXHIBIT
A
WARRANT
