Exhibit 10.1
Execution Copy
$355,000,000
CREDIT AGREEMENT
Dated as of July 2, 2003
among
A.T. ▇▇▇▇▇▇ Coal Company, Inc.
as Borrower
▇▇▇▇▇▇ Energy Company
as Holdings
and
The Lenders and Issuers Party Hereto
Citicorp North America, Inc.
as Administrative Agent
UBS Securities LLC
PNC Bank, National Association
as Co-Syndication Agents
Citigroup Global Markets Inc.
UBS Securities LLC
PNC Capital Markets
as Joint Lead Book Managers and Arrangers
Weil, Gotshal & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
TABLE OF CONTENTS
Page
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Article I Definitions, Interpretation And Accounting Terms.................................1
Section 1.1 Defined Terms................................................................1
Section 1.2 Computation of Time Periods.................................................34
Section 1.3 Accounting Terms and Principles.............................................34
Section 1.4 Certain Terms...............................................................35
Article II The Facilities..................................................................36
Section 2.1 The Commitments.............................................................36
Section 2.2 Borrowing Procedures........................................................36
Section 2.3 Letters of Credit...........................................................37
Section 2.4 Reduction and Termination of the Revolving Credit Commitments...............42
Section 2.5 Repayment of Loans..........................................................42
Section 2.6 Evidence of Debt............................................................43
Section 2.7 Optional Prepayments........................................................44
Section 2.8 Mandatory Prepayments.......................................................44
Section 2.9 Interest....................................................................46
Section 2.10 Conversion/Continuation Option..............................................47
Section 2.11 Fees........................................................................47
Section 2.12 Payments and Computations...................................................48
Section 2.13 Special Provisions Governing Eurodollar Rate Loans..........................51
Section 2.14 Capital Adequacy............................................................53
Section 2.15 Taxes.......................................................................53
Section 2.16 Substitution of Lenders.....................................................56
Section 2.17 Facility Increase...........................................................57
Article III Conditions To Loans And Letters Of Credit.......................................58
Section 3.1 Conditions Precedent to Initial Loans and Letters of Credit.................58
Section 3.2 Conditions Precedent to Each Loan and Letter of Credit......................61
Section 3.3 Determinations of Initial Borrowing Conditions..............................62
Article IV Representations and Warranties..................................................62
Section 4.1 Corporate Existence; Compliance with Law....................................62
Section 4.2 Corporate Power; Authorization; Enforceable Obligations.....................63
Section 4.3 Ownership of Borrower; Subsidiaries.........................................63
Section 4.4 Financial Statements........................................................64
Section 4.5 Material Adverse Change.....................................................65
TABLE OF CONTENTS
(continued)
Page
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Section 4.6 Solvency....................................................................65
Section 4.7 Litigation..................................................................65
Section 4.8 Taxes.......................................................................65
Section 4.9 Full Disclosure.............................................................66
Section 4.10 Margin Regulations..........................................................66
Section 4.11 No Burdensome Restrictions; No Defaults.....................................66
Section 4.12 Investment Company Act; Public Utility Holding Company Act..................67
Section 4.13 Use of Proceeds.............................................................67
Section 4.14 Insurance...................................................................67
Section 4.15 Labor Matters...............................................................67
Section 4.16 ERISA.......................................................................68
Section 4.17 Coal Act; Black Lung Act....................................................68
Section 4.18 Environmental Matters.......................................................68
Section 4.19 Intellectual Property.......................................................69
Section 4.20 Coal Supply Agreements......................................................70
Section 4.21 Surety Bonds................................................................70
Section 4.22 Title; Real Property; Titled Personal Equipment.............................70
Article V Financial Covenants.............................................................71
Section 5.1 Maximum Leverage Ratio......................................................72
Section 5.2 Maximum Secured Leverage Ratio..............................................72
Section 5.3 Minimum Interest Coverage Ratio.............................................72
Section 5.4 Capital Expenditures........................................................72
Article VI Reporting Covenants.............................................................73
Section 6.1 Financial Statements........................................................73
Section 6.2 Default Notices.............................................................75
Section 6.3 Litigation..................................................................75
Section 6.4 Asset Sales.................................................................75
Section 6.5 SEC Filings; Press Releases.................................................76
Section 6.6 Labor Relations.............................................................76
Section 6.7 Tax Returns.................................................................76
Section 6.8 Insurance...................................................................76
Section 6.9 ERISA Matters...............................................................76
Section 6.10 Environmental Matters.......................................................77
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TABLE OF CONTENTS
(continued)
Page
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Section 6.11 Customer Contracts..........................................................78
Section 6.12 Other Information...........................................................78
Article VII Affirmative Covenants...........................................................78
Section 7.1 Preservation of Corporate Existence, Etc....................................78
Section 7.2 Compliance with Laws, Etc...................................................78
Section 7.3 Conduct of Business.........................................................79
Section 7.4 Payment of Taxes, Etc.......................................................79
Section 7.5 Maintenance of Insurance....................................................79
Section 7.6 Access......................................................................80
Section 7.7 Keeping of Books............................................................80
Section 7.8 Maintenance of Properties, Etc..............................................80
Section 7.9 Material Contracts..........................................................81
Section 7.10 Application of Proceeds.....................................................81
Section 7.11 Environmental...............................................................81
Section 7.12 Mining......................................................................81
Section 7.13 Real Property...............................................................82
Section 7.14 Bailee's Letters............................................................83
Section 7.15 Approved Deposit Accounts; Control Accounts.................................83
Section 7.16 Additional Collateral and Guaranties........................................84
Article VIII Negative Covenants..............................................................86
Section 8.1 Indebtedness................................................................86
Section 8.2 Liens, Etc..................................................................87
Section 8.3 Investments.................................................................89
Section 8.4 Sale of Assets..............................................................90
Section 8.5 Restricted Payments.........................................................91
Section 8.6 Prepayment and Cancellation of Indebtedness.................................92
Section 8.7 Restriction on Fundamental Changes; Permitted Acquisitions..................93
Section 8.8 Change in Nature of Business................................................93
Section 8.9 Transactions with Affiliates................................................93
Section 8.10 Limitations on Restrictions on Subsidiary Distributions; No New
Negative Pledge..........................................................94
Section 8.11 Modification of Constituent Documents.......................................94
Section 8.12 Breach of Coal Supply Agreements; Mining Leases and Prep Plant Leases.......94
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TABLE OF CONTENTS
(continued)
Page
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Section 8.13 Modification of Material Debt Agreements....................................94
Section 8.14 Accounting Changes; Fiscal Year.............................................95
Section 8.15 Margin Regulations..........................................................95
Section 8.16 Operating Leases; Sale/Leasebacks...........................................95
Section 8.17 No Speculative Transactions.................................................95
Section 8.18 Compliance with ERISA.......................................................95
Article IX Events of Default...............................................................96
Section 9.1 Events of Default...........................................................96
Section 9.2 Remedies....................................................................98
Section 9.3 Actions in Respect of Letters of Credit.....................................98
Section 9.4 Rescission..................................................................99
Article X The Administrative Agent........................................................99
Section 10.1 Authorization and Action....................................................99
Section 10.2 Administrative Agent's Reliance, Etc.......................................100
Section 10.3 Posting of Approved Electronic Communications..............................100
Section 10.4 The Administrative Agent Individually......................................101
Section 10.5 Lender Credit Decision.....................................................101
Section 10.6 Indemnification............................................................102
Section 10.7 Successor Administrative Agent.............................................102
Section 10.8 Concerning the Collateral and the Collateral Documents.....................103
Section 10.9 Collateral Matters Relating to Related Obligations.........................104
Article XI Miscellaneous..................................................................105
Section 11.1 Amendments, Waivers, Etc...................................................105
Section 11.2 Assignments and Participations.............................................107
Section 11.3 Costs and Expenses.........................................................110
Section 11.4 Indemnities................................................................111
Section 11.5 Limitation of Liability....................................................113
Section 11.6 Right of Set-off...........................................................113
Section 11.7 Sharing of Payments, Etc...................................................114
Section 11.8 Notices, Etc...............................................................114
Section 11.9 No Waiver; Remedies........................................................116
Section 11.10 Binding Effect.............................................................116
Section 11.11 Governing Law..............................................................116
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TABLE OF CONTENTS
(continued)
Page
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Section 11.12 Submission to Jurisdiction; Service of Process.............................116
Section 11.13 Waiver of Jury Trial.......................................................117
Section 11.14 Marshaling; Payments Set Aside.............................................117
Section 11.15 Section Titles.............................................................117
Section 11.16 Execution in Counterparts..................................................118
Section 11.17 Entire Agreement...........................................................118
Section 11.18 Confidentiality............................................................118
Schedules
Schedule I - Commitments
Schedule II - Applicable Lending Offices and Addresses for Notices
Schedule 4.3 - Ownership of Subsidiaries
Schedule 4.8 Taxes
Schedule 4.15 - Labor Matters
Schedule 4.16 - List of Plans
Schedule 4.18 - Environmental Matters
Schedule 4.20 - Coal Supply Agreements
Schedule 4.22(b) - Owned Real Property
Schedule 4.22(c) - Mining Leases and Prep Plant Leases
Schedule 4.22(d) - Mines
Schedule 4.22(e) - Fixture Filing Locations
Schedule 4.22(f) - Material Mortgaged Leases
Schedule 8.1 - Existing Indebtedness
Schedule 8.2 - Existing Liens
Schedule 8.3 - Existing Investments
Exhibits
Exhibit A - Form of Assignment and Acceptance
Exhibit B-1 - Form of Revolving Credit Note
Exhibit B-2 - Form of Term Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Letter of Credit Request
Exhibit E - Form of Notice of Conversion or Continuation
Exhibit F-1 - Form of Opinion of Counsel for the Loan Parties
Exhibit F-2 - Form of Opinion of Local Counsel for the Loan Parties
Exhibit G - Form of Guaranty
Exhibit H - Form of Pledge and Security Agreement
v
Credit Agreement, dated as of July 2, 2003, among A.T. ▇▇▇▇▇▇ Coal
Company, INC., a Virginia corporation (the "Borrower"), ▇▇▇▇▇▇ Energy Company, a
Delaware corporation ("Holdings"), the Lenders (as defined below), the Issuers
(as defined below), Citicorp North America, INC. ("CNAI"), as agent for the
Lenders and the Issuers (in such capacity, the "Administrative Agent"), and UBS
Securities LLC ("UBS") and PNC Bank, National Association ("PNC"), as joint
syndication agents for the Lenders and the Issuers (in such capacity, UBS and
PNC, together, the "Co-Syndication Agents").
W i t n e s s e t h:
Whereas, the Borrower has requested that the Lenders and Issuers make
available for the purposes specified in this Agreement a term loan, revolving
credit and letter of credit facility; and
Whereas, the Lenders and Issuers are willing to make available to the
Borrower such term loan, revolving credit and letter of credit facility upon the
terms and subject to the conditions set forth herein;
Now, Therefore, in consideration of the premises and the covenants and
agreements contained herein, the parties hereto hereby agree as follows:
ARTICLE I
Definitions, Interpretation And Accounting Terms
Section 1.1 Defined Terms
As used in this Agreement, the following terms have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Account" has the meaning specified in the Pledge and Security
Agreement.
"Account Debtor" has the meaning specified in the Pledge and Security
Agreement.
"Administrative Agent" has the meaning specified in the preamble to
this Agreement.
"Affected Lender" has the meaning specified in Section 2.16
(Substitution of Lenders).
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling or that is controlled by or is under common
control with such Person, each officer, director, general partner or
joint-venturer of such Person, and each Person that is the beneficial owner of
10% or more of any class of Voting Stock of such Person. The term "control"
(including the terms "controlled by" or "under common control with") means the
possession, direct or indirect, of the power to vote 50% or more of the
securities having ordinary voting power for the election of directors of such
Person or to direct or cause the direction of the
management and policies of such Person, whether through ownership of voting
securities or by contract or otherwise.
"Agents" means, collectively, the Administrative Agent, Co-Syndication
Agents, and the Joint Lead Book Managers and Arrangers.
"Agent Affiliate" has the meaning specified in Section 10.3(c)(Posting
of Approved Electronic Communications).
"Agreement" means this Credit Agreement.
"Applicable Lending Office" means, with respect to each Lender, its
Domestic Lending Office in the case of a Base Rate Loan, and its Eurodollar
Lending Office in the case of a Eurodollar Rate Loan.
"Applicable Margin" means:
(a) with respect to Revolving Loans, (i) during the period commencing
on the Closing Date and ending three Business Days after the receipt by the
Administrative Agent of the Financial Statements for the second full Fiscal
Quarter ending after the Closing Date required to be delivered pursuant to
Section 6.1(a) or (b) (Financial Statements), as applicable, (A) with respect to
the Revolving Loans maintained as Base Rate Loans, a rate equal to 1.50% per
annum and (B) with respect to the Revolving Loans maintained as Eurodollar Rate
Loans, a rate equal to 2.50% per annum and (ii) thereafter, as of any date of
determination, a per annum rate equal to the rate set forth below opposite the
applicable type of Loan and the then applicable Leverage Ratio (determined on
the last day of the most recent Fiscal Period for which Financial Statements
have been delivered pursuant to Section 6.1(a) or (b) (Financial Statements))
set forth below:
---------------------------------------------------------------------
Eurodollar Rate Base Rate
Leverage Ratio Loans Loans
---------------------------------------------------------------------
Greater than or equal to 3.75 to 1 3.25% 2.25%
---------------------------------------------------------------------
Less than 3.75 to 1 and greater than or
equal to 3.50 to 1 3.00% 2.00%
---------------------------------------------------------------------
Less than 3.50 to 1 and greater than or
equal to 3.25 to 1 2.75% 1.75%
---------------------------------------------------------------------
Less than 3.25 to 1 and greater than or
equal to 3.00 to 1 2.50% 1.50%
---------------------------------------------------------------------
Less than 3.00 to 1 and greater than or
equal to 2.75 to 1 2.25% 1.25%
---------------------------------------------------------------------
Less than 2.75 to 1 1.75% 0.75%
---------------------------------------------------------------------
Changes in the Applicable Margin resulting from a change in the Leverage Ratio
on the last day of any subsequent Fiscal Period shall become effective as to all
Revolving Loans three Business Days after delivery by the Borrower to the
Administrative Agent of new Financial Statements pursuant to Section 6.1(a) or
(b) (Financial Statements), as applicable. Notwithstanding anything
2
to the contrary set forth in this Agreement (including the then effective
Leverage Ratio), if the Borrower shall fail to deliver such Financial Statements
within any of the time periods specified in Section 6.1(a) and (b) (Financial
Statements), the Applicable Margin from and including the 56th day after the end
of such Fiscal Quarter or the 101st day after the end of such Fiscal Year, as
the case may be, to but not including the date the Borrower delivers to the
Administrative Agent such Financial Statements shall equal the highest possible
Applicable Margin provided for by this definition; and
(b) with respect to the Term Loans, means 2.50% per annum, in the case
of Term Loans maintained as Base Rate Loans, and 3.50% per annum, in the case of
Term Loans maintained as Eurodollar Rate Loans.
"Applicable Unused Commitment Fee Rate" means, as of any date of
determination, a per annum rate equal to 0.50%.
"Approved Deposit Account" has the meaning specified in the Pledge and
Security Agreement.
"Approved Electronic Communications" means each notice, demand,
communication, information, document and other material that any Loan Party is
obligated to, or otherwise chooses to, provide to the Administrative Agent
pursuant to any Loan Document or the transactions contemplated therein,
including (a) any supplement to the Guaranty, any joinder to the Pledge and
Security Agreement and any other written Contractual Obligation delivered or
required to be delivered in respect of any Loan Document or the transactions
contemplated therein and (b) any Financial Statement, financial and other
report, notice, request, certificate and other information material; provided,
however, that, "Approved Electronic Communication" shall exclude (x) any Notice
of Borrowing, Letter of Credit Request, Notice of Conversion or Continuation,
and any other notice, demand, communication, information, document and other
material relating to a request for a new, or a conversion of an existing,
Borrowing, (ii) any notice pursuant to Section 2.7 (Optional Repayments) and
Section 2.8 (Mandatory Prepayments) and any other notice relating to the payment
of any principal or other amount due under any Loan Document prior to the
scheduled date therefor, (iii) all notices of any Default or Event of Default
and (iv) any notice, demand, communication, information, document and other
material required to be delivered to satisfy any of the conditions set forth in
Article III (Conditions to Loans and Letters of Credit) or Section 2.3(a)
(Letters of Credit) or any other condition to any Borrowing or other extension
of credit hereunder or any condition precedent to the effectiveness of this
Agreement.
"Approved Electronic Platform" has the meaning specified in Section
10.3(a) (Posting of Approved Electronic Communications).
"Approved Fund" means any Fund that is advised or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or Affiliate of an entity
that administers or manages a Lender.
"Arranger" means Citigroup Global Markets Inc., UBS Securities LLC or
PNC Capital Markets, each in its capacity as a joint arranger and joint book
runner.
"Asset Sale" has the meaning specified in Section 8.4 (Sale of
Assets).
3
"Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an Eligible Assignee, and accepted by the Administrative
Agent, in substantially the form of Exhibit A (Form of Assignment and
Acceptance).
"Attributable Receivables Securitization Indebtedness" means, in
respect of any factoring or receivables securitization arrangements of a Person,
the aggregate amount paid to such Person in connection with such factoring or
receivables securitization arrangements in respect of the Accounts subject to
such arrangement, as such amount may be reduced from time to time by any
collections received and distributed to such Person (or extinguishing the
obligation to repay or repurchase such Accounts in respect of which such
collections are received) pursuant to such factoring or securitization
arrangements.
"Available Credit" means, at any time, (a) the then effective
Revolving Credit Commitments minus (b) the aggregate Revolving Credit
Outstandings at such time.
"Bailee's Letter" means a letter in form and substance acceptable to
the Administrative Agent and executed by any Person (other than a Loan Party)
that is in possession of Inventory on behalf of a Loan Party pursuant to which
such Person acknowledges, among other things, the Administrative Agent's Lien
with respect thereto.
"Bankruptcy Code" means title 11, United States Code.
"Base Rate" means, for any period, a fluctuating interest rate per
annum as shall be in effect from time to time, which rate per annum shall be
equal at all times to the highest of (a) the rate of interest announced publicly
by Citibank in New York, New York, from time to time, as Citibank's base rate
and (b) 0.5% per annum plus the Federal Funds Rate.
"Base Rate Loan" means any Loan during any period in which it bears
interest based on the Base Rate.
"Black Lung Act" means collectively, the Black Lung Benefits Revenue
Act of 1977, as amended and the Black Lung Benefits Reform Act of 1977, as
amended.
"Blockage Notice" has the meaning specified in each Deposit Account
Control Agreement.
"Blue Ridge Securitization" means the asset-backed securitization
program pursuant to the Credit and Security Agreement, dated as of January 31,
2003, among ▇▇▇▇▇▇ Receivables Corporation, as borrower, A.T. ▇▇▇▇▇▇ Coal
Company, Inc., as servicer, Blue Ridge Asset Funding Corporation, the liquidity
banks party thereto and Wachovia Bank, National Association, as agent.
"Borrower" has the meaning specified in the preamble to this
Agreement.
"Borrowing" means a borrowing consisting of Revolving Loans or Term
Loans made on the same day by the Lenders ratably according to their respective
Commitments. A Borrowing may be a Revolving Credit Borrowing or a Term Loan
Borrowing.
"Business Day" means a day of the year on which banks are not required
or authorized to close in New York and, if the applicable Business Day relates
to notices,
4
determinations, fundings and payments in connection with the Eurodollar Rate or
any Eurodollar Rate Loans, a day on which dealings in Dollar deposits are also
carried on in the London interbank market.
"Capital Expenditures" means, for Holdings for any period (a) the
aggregate of amounts that would be reflected as additions to property, plant or
equipment on a Consolidated balance sheet of Holdings and its Subsidiaries,
excluding interest capitalized during construction and any capitalized non-cash
liabilities assumed minus (b)(i) the aggregate of amounts that would be
reflected as additions to property, plant or equipment on a Consolidated balance
sheet of Holdings and its Subsidiaries in respect of any Subsidiary that
Holdings does not own, directly or indirectly, 80% or more of such Subsidiary's
Voting Stock, excluding interest capitalized during construction and any
capitalized non-cash liabilities of such Subsidiary, and (ii) without
duplication of clause (i), amounts captured in clause (a) to the extent paid for
with proceeds arising from an Asset Sale or Property Loss Event (to the extent
permitted by clause (d) of Section 2.8 (Mandatory Prepayments)), in each case
with respect to property, plant or equipment.
"Capital Lease" means, with respect to any Person, any lease of, or
other arrangement conveying the right to use, property by such Person as lessee
that would be accounted for as a capital lease on a balance sheet of such Person
prepared in conformity with GAAP.
"Capital Lease Obligations" means, with respect to any Person, the
capitalized amount of all Consolidated obligations of such Person or any of its
Subsidiaries under Capital Leases.
"Cash Collateral Account" has the meaning specified in the Pledge and
Security Agreement.
"Cash Equivalents" means (a) securities issued or fully guaranteed or
insured by the United States government or any agency thereof, (b) certificates
of deposit, eurodollar time deposits, overnight bank deposits and bankers'
acceptances of any commercial bank organized under the laws of the United
States, any state thereof, the District of Columbia, any foreign bank, or its
branches or agencies (fully protected against currency fluctuations) that, at
the time of acquisition, are rated at least "A-1" by S&P or "P-1" by Moody's,
(c) commercial paper of an issuer rated at least "A-1" by S&P or "P-1" by
Moody's and (d) shares of any money market fund that (i) has at least 95% of its
assets invested continuously in the types of investments referred to in clauses
(a), (b) and (c) above, (ii) has net assets of not less than $500,000,000 and
(iii) is rated at least "A-1" by S&P or "P-1" by Moody's; provided, however,
that the maturities of all obligations of the type specified in clauses (a), (b)
and (c) above shall not exceed 180 days.
"Cash Interest Expense" means, with respect to any Person for any
period, the Interest Expense of such Person for such period less the Non-Cash
Interest Expense of such Person for such period.
"Cash Management Document" means any certificate, agreement or other
document executed by any Loan Party in respect of the Cash Management
Obligations of any Loan Party.
"Cash Management Obligation" means, as applied to any Person, any
direct or indirect liability, contingent or otherwise, of such Person in respect
of cash management services
5
(including treasury, depository, overdraft, credit or debit card, electronic
funds transfer and other cash management arrangements) provided after the date
hereof (regardless of whether these or similar services were provided prior to
the date hereof by the Administrative Agent, any Lender or any Affiliate or any
of them) by the Administrative Agent in connection with this Agreement or any
Loan Document (other than Cash Management Documents), including obligations for
the payment of fees, interest, charges, expenses, attorneys' fees and
disbursements in connection therewith.
"Change of Control" means the occurrence of any of the following: (a)
any person or group of persons (within the meaning of the Securities Exchange
Act of 1934, as amended) shall have acquired beneficial ownership (within the
meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended) of 25 % or more of the issued and
outstanding Voting Stock of Holdings, (b) during any period of twelve
consecutive calendar months, individuals who at the beginning of such period
constituted the board of directors of Holdings (together with any new directors
whose election by the board of directors of Holdings or whose nomination for
election by the stockholders of Holdings was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at
the beginning of such period or whose elections or nomination for election was
previously so approved) cease for any reason other than death or disability to
constitute a majority of the directors then in office or (c) Holdings shall
cease to own and control all of the economic and voting rights associated with
all of the outstanding Stock of the Borrower or, other than as permitted
hereunder, any Subsidiary Guarantor.
"Chattel Paper" has the meaning specified in the Pledge and Security
Agreement.
"Citibank" means Citibank, N.A., a national banking association.
"Closing Date" means the first date on which any Loan is made or any
Letter of Credit is Issued.
"CNAI" has the meaning specified in the preamble to this Agreement.
"Co-Syndication Agents" has the meaning specified in the preamble to
this Agreement.
"Coal" means all of the coal owned or leased by any ▇▇▇▇▇▇ Entity and
(i) located on, under, or within, or (ii) produced and severed from, the
properties owned or leased by any ▇▇▇▇▇▇ Entity.
"Coal Act" means the Coal Industry Retiree Health Benefits Act of
1992, as amended.
"Coal Handling Facility" means any coal handling facility, including,
all necessary electrical, water and plumbing lines and systems necessary to
operate such coal handling facility, all coal storage and transportation
facilities, administrative facilities and vehicle parking facilities related
thereto and all leases in respect of the foregoing.
6
"Coal Supply Agreements" means those contracts now in effect or
hereafter entered into by any ▇▇▇▇▇▇ Entity for the sale, purchase, exchange,
processing or handling of Coal with an initial term of more than one year.
"Code" means the Internal Revenue Code of 1986.
"Collateral" means all property and interests in property and proceeds
thereof now owned or hereafter acquired by any Loan Party in or upon which a
Lien is granted under any Collateral Document.
"Collateral Documents" means the Pledge and Security Agreement,
Control Account Agreements, the Mortgages, the Deposit Account Control
Agreements and any other document executed and delivered by a Loan Party
granting a Lien on any of its property to secure payment of the Secured
Obligations.
"Commitment" means, with respect to any Lender, such Lender's
Revolving Credit Commitment, if any, and Term Loan Commitment, if any, and
"Commitments" means the aggregate Revolving Credit Commitments and Term Loan
Commitments of all Lenders.
"Compliance Certificate" has the meaning specified in Section 6.1(c)
(Financial Statements).
"Consolidated" means, with respect to any Person, the consolidation of
accounts of such Person and its Subsidiaries in accordance with GAAP.
"Consolidated Current Assets" means, with respect to any Person at any
date, the total Consolidated current assets of such Person and its Subsidiaries
at such date.
"Consolidated Current Liabilities" means, with respect to any Person
at any date, all liabilities of such Person and its Subsidiaries at such date
that should be classified as current liabilities on a Consolidated balance sheet
of such Person and its Subsidiaries but excluding the principal amount of any
current portion of any long term Indebtedness.
"Consolidated Net Income" means, for any Person for any period, the
Consolidated net income (or loss) of such Person and its Subsidiaries for such
period; provided, however, that (a) the net income of any other Person in which
such Person or one of its Subsidiaries has a joint interest with a third party
(which interest does not cause the net income of such other Person to be
Consolidated into the net income of such Person) shall be included only to the
extent of the amount of dividends or distributions paid to such Person or
Subsidiary, (b) the net income of any Subsidiary of such Person that is subject
to any restriction or limitation on the payment of dividends or the making of
other distributions shall be excluded to the extent of such restriction or
limitation and (c) nonrecurring extraordinary or unusual gains and losses and
any one-time increase or decrease to net income that is required to be recorded
because of the adoption of new accounting policies, practices or standards
required by GAAP shall be excluded.
"Constituent Documents" means, with respect to any Person, (a) the
articles of incorporation, certificate of incorporation or certificate of
formation (or the equivalent organizational documents) of such Person, (b) the
by-laws, operating agreement (or the equivalent governing documents) of such
Person and (c) any document setting forth the manner of election and duties of
the directors or managing members of such Person (if any) and the
7
designation, amount or relative rights, limitations and preferences of any class
or series of such Person's Stock.
"Contaminant" means any material, substance or waste that is
classified, regulated or otherwise characterized under any Environmental Law as
hazardous, toxic, a contaminant or a pollutant or by other words of similar
meaning or regulatory effect, including any petroleum or petroleum-derived
substance or waste, asbestos and polychlorinated biphenyls.
"Contractual Obligation" of any Person means any obligation,
agreement, undertaking or similar provision of any Security issued by such
Person or of any agreement, undertaking, contract, lease, indenture, mortgage,
deed of trust or other instrument (excluding a Loan Document) to which such
Person is a party or by which it or any of its property is bound or to which any
of its property is subject.
"Control Account Agreement" has the meaning specified in the Pledge
and Security Agreement.
"Convertible Note Indenture" means the Indenture, dated as of May 29,
2003, among Holdings, as issuer, the Borrower, as guarantor and Wilmington Trust
Company, as Trustee, as may be supplemented from time to time in accordance with
the terms hereof.
"Convertible Notes" means Holdings' 4.75% Convertible Senior Notes due
May 15, 2023 issued under the Convertible Note Indenture in an aggregate
original principal amount of $132,000,000.
"Corporate Chart" means a corporate organizational chart, list or
other similar document in each case in form reasonably acceptable to the
Administrative Agent and setting forth, for each Person that is a Loan Party,
that is subject to Section 7.16 (Additional Collateral and Guaranties) or that
is a Subsidiary of any of them, (a) the full legal name of such Person (and any
trade name, fictitious name or other name such Person may have had or operated
under), (b) the jurisdiction of organization, the organizational number (if any)
and the tax identification number (if any) of such Person, (c) the location of
such Person's chief executive office (or sole place of business) and (d) the
number of shares of each class of such Person's Stock authorized (if
applicable), the number outstanding as of the date of delivery and the number
and percentage of such outstanding shares for each such class owned (directly or
indirectly) by any Loan Party or any Subsidiary of any of them.
"Customary Permitted Liens" means, with respect to any Person, any of
the following Liens:
(a) Liens with respect to the payment of taxes, assessments or
governmental charges or levies in each case that are not yet due and
payable or that are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves or other
appropriate provisions are being maintained to the extent required by GAAP;
(b) Liens of landlords arising by statute and liens of suppliers,
mechanics, carriers, materialmen, warehousemen or workmen and other liens
imposed by law or pursuant to customary reservations or retentions of title
arising in the ordinary course of business for amounts not yet due and
payable or that are being contested in good faith by
8
appropriate proceedings and with respect to which adequate reserves or
other appropriate provisions are being maintained to the extent required by
GAAP;
(c) Liens incurred or deposits made in the ordinary course of business
in connection with unemployment insurance or to secure the performance of
bids, tenders, sales, leases, contracts (other than for the repayment of
borrowed money) and customs, performance or return-of-money bonds and
similar obligations;
(d) any matters that are or would be shown on an accurate survey, any
encumbrances arising by reason of zoning restrictions, any and all matters
and exceptions to title that would be shown on a title insurance commitment
or in a lawyer's title opinion (excluding monetary liens), including
without limitation, any easements, licenses, defects or irregularities in
title, reservations (including severances, leases or reservations of oil,
gas, coal, minerals or water rights), covenants, rights-of-way, utility
easements, building restrictions and other similar encumbrances on title to
or on the use of real property not materially interfering with the ordinary
conduct of the business conducted and proposed to be conducted at such real
property;
(e) encumbrances arising under leases or subleases of property that do
not, in the aggregate, interfere with the ordinary conduct of the business
conducted and proposed to be conducted at such property;
(f) any interest of title (and any encumbrances or other matters
listed in clause (d) above affecting title) of a lessor under, and liens
arising from financing statements with respect to a lessor's or consignor's
rights in and to real or personal property leased or consigned to such
Person in the ordinary course of such Person's business;
(g) normal customary rights of setoff in favor of banks;
(h) Liens of sellers of goods under Article 2 of the UCC; and
(i) Liens of a collection bank under Section 4-210 of the UCC.
"Debt Issuance" means the incurrence of Indebtedness of the type
specified in clause (a) or (b) of the definition of "Indebtedness" by any ▇▇▇▇▇▇
Entity.
"Default" means any event that, with the passing of time or the giving
of notice or both, would become an Event of Default.
"Deposit Account" has the meaning specified in the Pledge and Security
Agreement.
"Deposit Account Bank" has the meaning specified in the Pledge and
Security Agreement.
"Deposit Account Control Agreement" has the meaning specified in the
Pledge and Security Agreement.
9
"Disclosure Documents" means (i) the Confidential Information
Memorandum dated May 2003 provided to each lender and (ii) the annual report on
form 10-K, as amended, filed by Holdings with the Securities and Exchange
Commission for Fiscal Year ended December 31, 2002.
"Documentary Letter of Credit" means any Letter of Credit that is
drawable upon presentation of documents evidencing the sale or shipment of goods
purchased by any ▇▇▇▇▇▇ Entity in the ordinary course of its business.
"Dollars" and the sign "$" each mean the lawful money of the United
States of America.
"Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office" opposite its
name on Schedule II (Applicable Lending Offices and Addresses for Notices) or on
the Assignment and Acceptance by which it became a Lender or such other office
of such Lender as such Lender may from time to time specify to the Borrower and
the Administrative Agent.
"Domestic Person" means any "United States person" under and as
defined in Section 7701(a)(30) of the Code.
"Domestic Subsidiary" means any Subsidiary of Holdings organized under
the laws of any state of the United States of America or the District of
Columbia.
"Eastman" means the TEC System (as such term is defined in the
Construction and Ownership Agreement made as of March 1, 2001 between ▇▇▇▇▇▇▇
Chemical Company and Tennessee Energy Corp.) which is the portion of the Coal
Handling Facility constructed by Tennessee Energy Corp. at ▇▇▇▇▇▇▇ Chemical
Company's Kingsport, Tennessee plant, and includes, all locomotive(s), all
equipment, parts and supplies incorporated into the Coal Handling Facility by
Tennessee Energy Corp. and all integrally related tangible and intangible
assets, including leases, coal handling agreements, service agreements and
transportation agreements. "Eastman" is located on certain land areas located in
the 11th and 13th Civil Districts of ▇▇▇▇▇▇▇▇ County, Tennessee, within ▇▇▇▇▇▇▇
Chemical Company's plant site at Kingsport, Tennessee, lying partly within and
partly without the City of Kingsport.
"EBITDA" means, with respect to any Person for any period, (a)
Consolidated Net Income of such Person for such period plus (b) the sum of, in
each case to the extent included in the calculation of such Consolidated Net
Income but without duplication, (i) any provision for income taxes, (ii)
Interest Expense, (iii) loss from extraordinary items, (iv) any aggregate loss
from the sale, exchange or other disposition of capital assets by such Person
(excluding, in the case of Holdings and its Subsidiaries, any such loss
attributable to the sale of Appalachian Synfuels, LLC), (v) depreciation,
depletion and amortization expenses and (vi) all other non-cash charges and
non-cash losses for such period, including the amount of any compensation
deduction as the result of any grant of Stock or Stock Equivalents to employees,
officers, directors or consultants minus (c) the sum of, in each case to the
extent included in the calculation of such Consolidated Net Income but without
duplication, (i) any credit for income tax, (ii) interest income, (iii) gains
from extraordinary items for such period, (iv) any aggregate gain from the sale,
exchange or other disposition of capital assets by such Person (excluding, in
the case of Holdings and its Subsidiaries, any such gain attributable to the
sale of Appalachian Synfuels, LLC) and (v) any other non-cash gains or other
items which have been added in
10
determining Consolidated Net Income, including any reversal of a change referred
to in clause (b)(v) above by reason of a decrease in the value of any Stock or
Stock Equivalent.
"Eligible Assignee" means (a) a Lender or any Affiliate or Approved
Fund of such Lender, (b) a commercial bank having total assets in excess of
$5,000,000,000, (c) a finance company, insurance company or any other financial
institution or fund, in each case reasonably acceptable to the Administrative
Agent and, if such Person is acquiring a Revolving Credit Commitment or a
Revolving Loan, the Borrower, and regularly engaged in making, purchasing or
investing in loans and having a net worth, determined in accordance with GAAP,
in excess of $250,000,000 or, to the extent net worth is less than such amount,
a finance company, insurance company, other financial institution or fund,
reasonably acceptable to the Administrative Agent or (d) a savings and loan
association or savings bank organized under the laws of the United States or any
State thereof having a net worth, determined in accordance with GAAP, in excess
of $250,000,000.
"Environmental Laws" means all applicable Requirements of Law relating
to pollution or the regulation and protection of human health, the environment
or natural resources, including the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended (42 U.S.C.(S) 9601 et seq.);
the Hazardous Material Transportation Act, as amended (49 U.S.C.(S) 1801 et
seq.); the Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7
U.S.C.(S) 136 et seq.); the Resource Conservation and Recovery Act, as amended
(42 U.S.C. (S) 6901 et seq.); the Toxic Substances Control Act, as amended (15
U.S.C.(S) 2601 et seq.); the Clean Air Act, as amended (42 U.S.C.(S) 7401 et
seq.); the Federal Water Pollution Control Act, as amended (33 U.S.C.(S) 1251 et
seq.); the Safe Drinking Water Act, as amended (42 U.S.C.(S) 300f et seq.); the
Surface Mining Control and Reclamation Act and each of their state and local
counterparts or equivalents and any transfer of ownership notification or
approval statute.
"Environmental Liabilities and Costs" means, with respect to any
Person, all liabilities, obligations, responsibilities, Remedial Actions,
losses, damages, punitive damages, consequential damages, treble damages, costs
and expenses (including all fees, disbursements and expenses of counsel, experts
and consultants and costs of investigation and feasibility studies), fines,
penalties, sanctions and interest incurred as a result of any claim or demand by
any other Person, whether based in contract, tort, implied or express warranty,
strict liability, criminal or civil statute and whether arising under any
Environmental Law, Permit, order or agreement with any Governmental Authority or
other Person, in each case relating to any environmental or health condition or
to any Release or threatened Release and resulting from the past, present or
future operations of, or ownership of property by, such Person or any of its
Subsidiaries.
"Environmental Lien" means any Lien in favor of any Governmental
Authority for Environmental Liabilities and Costs.
"Equity Issuance" means the issue or sale of any Stock of Holdings,
the Borrower or any Subsidiary of the Borrower by Holdings, the Borrower or any
Subsidiary of the Borrower to any Person other than Holdings, the Borrower or
any Subsidiary of the Borrower.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control or treated as a single employer with Holdings
or any of its Subsidiaries within the meaning of Section 414(b), (c), (m) or (o)
of the Code.
11
"ERISA Event" means (a) a reportable event described in Section
4043(b) or 4043(c)(1), (2), (3), (5), (6), (8) or (9) of ERISA with respect to a
Title IV Plan or a Multiemployer Plan, (b) the withdrawal of Holdings, any of
its Subsidiaries or any ERISA Affiliate from a Title IV Plan subject to Section
4063 of ERISA during a plan year in which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA, (c) the complete or partial withdrawal
of Holdings, any of its Subsidiaries or any ERISA Affiliate from any
Multiemployer Plan, (d) notice of reorganization or insolvency of a
Multiemployer Plan, (e) the filing of a notice of intent to terminate a Title IV
Plan or the treatment of a plan amendment as a termination under Section 4041 of
ERISA, (f) the institution of proceedings to terminate a Title IV Plan or
Multiemployer Plan by the PBGC, (g) the failure to make any required
contribution to a Title IV Plan or Multiemployer Plan, (h) the imposition of a
lien under Section 412 of the Code or Section 302 of ERISA on Holdings or any of
its Subsidiaries or any ERISA Affiliate or (i) any other event or condition that
might reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any Title
IV Plan or Multiemployer Plan or the imposition of any liability under Title IV
of ERISA, other than for PBGC premiums due but not delinquent under Section 4007
of ERISA.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Federal Reserve Board.
"Eurodollar Base Rate" means, with respect to any Interest Period for
any Eurodollar Rate Loan, the rate determined by the Administrative Agent to be
the offered rate for deposits in Dollars for the applicable Interest Period
appearing on the Dow ▇▇▇▇▇ Markets Telerate Page 3750 as of 11:00 a.m., London
time, on the second full Business Day next preceding the first day of each
Interest Period. In the event that such rate does not appear on the Dow ▇▇▇▇▇
Markets Telerate Page 3750 (or otherwise on the Dow ▇▇▇▇▇ Markets screen), the
Eurodollar Base Rate for the purposes of this definition shall be determined by
reference to such other comparable publicly available service for displaying
eurodollar rates as may be selected by the Administrative Agent, or, in the
absence of such availability, the Eurodollar Base Rate shall be the rate of
interest determined by the Administrative Agent to be the rate per annum at
which deposits in Dollars are offered by the principal office of Citibank in
London to major banks in the London interbank market at 11:00 a.m. (London time)
two Business Days before the first day of such Interest Period in an amount
substantially equal to the Eurodollar Rate Loan of Citibank for a period equal
to such Interest Period.
"Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule II (Applicable Lending Offices and Addresses for Notices) or on
the Assignment and Acceptance by which it became a Lender (or, if no such office
is specified, its Domestic Lending Office) or such other office of such Lender
as such Lender may from time to time specify to the Borrower and the
Administrative Agent.
"Eurodollar Rate" means, with respect to any Interest Period for any
Eurodollar Rate Loan, an interest rate per annum equal to the rate per annum
obtained by dividing (a) the Eurodollar Base Rate by (b)(i) a percentage equal
to 100% minus (ii) the reserve percentage applicable two Business Days before
the first day of such Interest Period under regulations issued from time to time
by the Federal Reserve Board for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve requirement)
for a member bank of the Federal Reserve System in New York City with respect to
liabilities or assets
12
consisting of or including Eurocurrency Liabilities (or with respect to any
other category of liabilities that includes deposits by reference to which the
Eurodollar Rate is determined) having a term equal to such Interest Period.
"Eurodollar Rate Loan" means any Loan that, for an Interest Period,
bears interest based on the Eurodollar Rate.
"Event of Default" has the meaning specified in Section 9.1 (Events of
Default).
"Excess Cash Flow" means, for Holdings for any period, the sum of
"Cash provided (utilized) by operating activities" and the amount attributable
to the sale of Appalachian Synfuels, LLC in "Proceeds from sale of assets", each
as reflected on Holdings' audited Consolidated statements of cash flows
furnished to the Administrative Agent pursuant to Section 6.1(b) (Annual
Reports), minus the sum of the following items (without duplication) for the
Fiscal Year then ended: (i) Capital Expenditures, (ii) cash dividends declared
and paid on the Common Stock of Holdings as permitted by Section 8.5 (Restricted
Payments), (iii) principal payments on the Loans (but only, in the case of a
payment in respect of Revolving Loans, to the extent that the Revolving Credit
Commitments are permanently reduced by the amount of such payments during such
period) and (iv) principal payments by Holdings or its Subsidiaries on
Indebtedness (other than the Secured Obligations) permitted by Section 8.1
(Indebtedness), including the principal portion of Capital Lease Obligations.
"Existing Credit Agreements" means (i) that certain amended and
restated multi-year revolving credit agreement, dated as of November 26, 2002
and as amended on January 30, 2003, among Holdings, each domestic subsidiary
thereof set forth on the signature pages thereto, the institutions party thereto
as lenders and issuing banks, Citicorp USA, Inc., in its capacity as
administrative agent for the Existing Lenders, PNC, as syndication agent for the
Existing Lenders, and Wachovia Bank, National Association, as documentation
agent for the Existing Lenders and (ii) that certain amended and restated
364-day revolving credit agreement, dated as of November 26, 2002 and as amended
on January 30, 2003, among Holdings, each domestic subsidiary thereof set forth
on the signature pages thereto, the institutions party thereto as lenders and
issuing banks, Citicorp USA, Inc., in its capacity as administrative agent for
the Existing Lenders, PNC, as syndication agent for the Existing Lenders, and
Wachovia Bank, National Association, as documentation agent for the Existing
Lenders.
"Existing Lenders" means the financial institutions party to the
Existing Credit Agreements, in their capacity as lenders thereunder.
"Facilities" means (a) the Term Loan Facility and (b) the Revolving
Credit Facility.
"Fair Market Value" means (a) with respect to any asset or group of
assets (other than a marketable Security) at any date, the value of the
consideration obtainable in a sale of such asset at such date assuming a sale by
a willing seller to a willing purchaser dealing at arm's length and arranged in
an orderly manner over a reasonable period of time having regard to the nature
and characteristics of such asset (which, in the case of assets which have a net
book value in excess of $10,000,000, such fair market value shall be as
reasonably approved by the Board of Directors of the Borrower) or, if such asset
shall have been the subject of a relatively contemporaneous appraisal by an
independent third party appraiser, the basic assumptions underlying which have
not materially changed since its date, the value set forth in such appraisal
13
and (b) with respect to any marketable Security at any date, the closing sale
price of such Security on the Business Day next preceding such date, as
appearing in any published list of any national securities exchange or the
NASDAQ Stock Market or, if there is no such closing sale price of such Security,
the final price for the purchase of such Security at face value quoted on such
business day by a financial institution of recognized standing regularly dealing
in securities of such type and selected by the Administrative Agent.
"Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.
"Federal Reserve Board" means the Board of Governors of the United
States Federal Reserve System, or any successor thereto.
"Fee Letter" shall mean the letter dated as of May 7, 2003 (as amended
as of June 30, 2003) addressed to the Borrower from CNAI, Citigroup Global
Markets Inc., UBS and UBS AG, Cayman Islands Branch and accepted by the Borrower
on May 7, 2003, with respect to certain fees to be paid by the Borrower from
time to time to the other parties thereto.
"Financial Covenant Debt" of any Person means (a)(i) Indebtedness of
the type specified in clauses (a), (b), (d), (e), (f), (h) and (j) of the
definition of "Indebtedness" (subject to Section 1.3 (Accounting Terms and
Principles)), plus (ii) all obligations under standby letters of credit (whether
or not issued under this Agreement) and non-contingent reimbursement obligations
of the type specified in clause (c) of the definition of "Indebtedness" minus
(b) in each case to the extent included in clause (a) above but without
duplication, (i) all obligations under undrawn standby letters of credit
(whether or not issued under this Agreement) issued with respect to performance
obligations under sales contracts, and performance obligations with respect to
mine reclamation and black lung requirements, workers compensation and other
employee benefit liabilities, (ii) all obligations under other letters of credit
in respect of which the Borrower has provided Letter of Credit Support, but only
in an amount equal to such Letter of Credit Support, and (iii) Restricted Cash.
"Financial Statements" means the financial statements of Holdings and
its Subsidiaries delivered in accordance with Sections 4.4 (Financial
Statements) and 6.1 (Financial Statements).
"Fiscal Period" means any Fiscal Quarter or Fiscal Year.
"Fiscal Quarter" means each of the three month periods ending on March
31, June 30, September 30 and December 31.
"Fiscal Year" means the twelve month period ending on December 31.
14
"Fund" means any Person (other than a natural Person) that is or will
be engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and the statements and pronouncements of the
Financial Accounting Standards Board, or in such other statements by such other
entity as may be in general use by significant segments of the accounting
profession, that are applicable to the circumstances as of the date of
determination.
"General Intangible" has the meaning specified in the Pledge and
Security Agreement.
"Governmental Authority" means any nation, sovereign or government,
any state or other political subdivision thereof and any entity or authority
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including any central bank or stock
exchange.
"Guarantor" means Holdings and each Subsidiary Guarantor.
"Guaranty" means the guaranty, in substantially the form of Exhibit G
(Form of Guaranty), executed by the Guarantors.
"Guaranty Obligation" means, as applied to any Person, any direct or
indirect liability, contingent or otherwise, of such Person with respect to any
Indebtedness of another Person, if the purpose or intent of such Person in
incurring the Guaranty Obligation is to provide assurance to the obligee of such
Indebtedness that such Indebtedness will be paid or discharged, or that any
agreement relating thereto will be complied with, or that any holder of such
Indebtedness will be protected (in whole or in part) against loss in respect
thereof, including (a) the direct or indirect guaranty, endorsement (other than
for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of Indebtedness
of another Person and (b) any liability of such Person for Indebtedness of
another Person through any agreement (contingent or otherwise) (i) to purchase,
repurchase or otherwise acquire such Indebtedness or any security therefor, or
to provide funds for the payment or discharge of such Indebtedness (whether in
the form of a loan, advance, stock purchase, capital contribution or otherwise),
(ii) to maintain the solvency or any balance sheet item, level of income or
financial condition of another Person, (iii) to make take-or-pay or similar
payments, if required, regardless of non-performance by any other party or
parties to an agreement, (iv) to purchase, sell or lease (as lessor or lessee)
property, or to purchase or sell services, primarily for the purpose of enabling
the debtor to make payment of such Indebtedness or to assure the holder of such
Indebtedness against loss or (v) to supply funds to, or in any other manner
invest in, such other Person (including to pay for property or services
irrespective of whether such property is received or such services are
rendered), if in the case of any agreement described under clause (b)(i), (ii),
(iii), (iv) or (v) above the primary purpose or intent thereof is to provide
assurance that Indebtedness of another Person will be paid or discharged, that
any agreement relating thereto will be complied with or that any holder of such
Indebtedness will be protected (in whole or in part) against loss in respect
thereof. The amount of any Guaranty Obligation shall be equal to the amount of
the Indebtedness so guaranteed or otherwise supported.
15
"▇▇▇▇▇▇ Case" means post trial proceedings, including appeals, with
respect to the August 1, 2002 jury verdict in favor of ▇▇▇▇▇▇ Mining Corp., et
al., against the Borrower and certain of its Subsidiaries.
"Hedging Contracts" means all Interest Rate Contracts, foreign
exchange contracts, currency swap or option agreements, forward contracts,
commodity swap, purchase or option agreements, other commodity price hedging
arrangements, and all other similar agreements or arrangements designed to alter
the risks of any Person arising from fluctuations in interest rates, currency
values or commodity prices.
"Holdings" has the meaning specified in the preamble to this
Agreement.
"Holdings' Accountants" means Ernst & Young LLP or other independent
nationally-recognized public accountants selected by Holdings and acceptable to
the Administrative Agent.
"Indebtedness" of any Person means without duplication (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person evidenced by notes, bonds, debentures or similar instruments or that bear
interest, (c) all reimbursement and other obligations with respect to letters of
credit, bankers' acceptances, surety bonds and performance bonds, whether or not
matured, (d) all indebtedness for the deferred purchase price of property or
services, other than trade payables incurred in the ordinary course of business
that are not overdue for more than 90 days unless contested in good faith and by
appropriate proceedings if adequate reserves have been established on the books
of such Person, (e) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (f) all Capital Lease Obligations of such Person, (g)
all Guaranty Obligations of such Person, (h) all obligations of such Person to
purchase, redeem, retire, defease or otherwise acquire for value any Stock or
Stock Equivalents of such Person, valued, in the case of redeemable preferred
stock, at the greater of its voluntary liquidation preference and its
involuntary liquidation preference plus accrued and unpaid dividends, (i) all
payments that such Person would have to make in the event of an early
termination on the date Indebtedness of such Person is being determined in
respect of Hedging Contracts of such Person, (j) the Attributable Receivables
Securitization Indebtedness of such Person, and (k) all Indebtedness of the type
referred to above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien upon or
in property (including accounts and general intangibles) owned by such Person,
even though such Person has not assumed or become liable for the payment of such
Indebtedness, but only to the extent of the fair market value of such property.
"Indemnified Matter" has the meaning specified in Section 11.4
(Indemnities).
"Indemnitee" has the meaning specified in Section 11.4 (Indemnities).
"Insolvent Lender" means any Lender (i) which generally does not pay
its debts as such debts become due, admits in writing its inability to pay its
debts generally or which has made a general assignment for the benefit of
creditors, (ii) in respect of which any proceeding shall be instituted by or
against seeking to adjudicate it bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
16
composition of it or its debts, under any Requirement of Law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a custodian, receiver,
trustee or other similar official for it or for any substantial part of its
property; or (iii) which takes any corporate action to authorize any action set
forth in clauses (i) and (ii) above.
"Instrument" has the meaning specified in the Pledge and Security
Agreement
"Interest Coverage Ratio" means, with respect to any Person for any
period, the ratio of (a) Consolidated EBITDA of such Person for such period to
(b) Cash Interest Expense of such Person for such period.
"Interest Expense" means, for any Person for any period, (a)
Consolidated total interest expense (including any yield or similar amounts
payable in connection with a Permitted Securitization) of such Person and its
Subsidiaries for such period plus (b) , in any event, interest capitalized
during such period and Consolidated net costs and net losses under Interest Rate
Contracts for such period minus (c), in all cases, (i) Consolidated net gains of
such Person and its Subsidiaries under Interest Rate Contracts for such period
and (ii) any Consolidated interest income of such Person and its Subsidiaries
for such period.
"Interest Period" means, in the case of any Eurodollar Rate Loan, (a)
initially, the period commencing on the date such Eurodollar Rate Loan is made
or on the date of conversion of a Base Rate Loan to such Eurodollar Rate Loan
and ending, in the case of clause (i) below, 7 days thereafter and otherwise
one, two, three or six months thereafter, as selected by the Borrower in its
Notice of Borrowing or Notice of Conversion or Continuation given to the
Administrative Agent pursuant to Section 2.2 (Borrowing Procedures) or 2.10
(Conversion/Continuation Option) and (b) thereafter, if such Loan is continued,
in whole or in part, as a Eurodollar Rate Loan pursuant to Section 2.10
(Conversion/Continuation Option), a period commencing on the last day of the
immediately preceding Interest Period therefor and ending, in the case of clause
(i) below, 7 days thereafter and otherwise one, two, three or six months
thereafter, as selected by the Borrower in its Notice of Conversion or
Continuation given to the Administrative Agent pursuant to Section 2.10
(Conversion/Continuation Option); provided, however, that all of the foregoing
provisions relating to Interest Periods in respect of Eurodollar Rate Loans are
subject to the following:
(i) prior to the Syndication Completion Date each Interest Period
shall be for seven days (or such shorter period acceptable to the
Administrative Agent);
(ii) if any Interest Period would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day, unless the result of such extension would be to
extend such Interest Period into another calendar month, in which event
such Interest Period shall end on the immediately preceding Business Day;
(iii) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of a calendar month;
17
(iv) the Borrower may not select any Interest Period that ends
after the date of a scheduled principal payment on the Loans as set forth
in Article II (The Facilities) unless, after giving effect to such
selection, the aggregate unpaid principal amount of the Loans for which
Interest Periods end after such scheduled principal payment shall be equal
to or less than the principal amount to which the Loans are required to be
reduced after such scheduled principal payment is made;
(v) the Borrower may not select any Interest Period in respect of
Loans having an aggregate principal amount of less than $5,000,000; and
(vi) there shall be outstanding at any one time no more than 10
Interest Periods in the aggregate.
"Interest Rate Contracts" means all interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements and interest rate
insurance.
"Investment" means, with respect to any Person, (a) any purchase or
other acquisition by such Person of (i) any Security issued by, (ii) a
beneficial interest in any Security issued by, or (iii) any other equity
ownership interest in, any other Person, (b) any purchase by such Person of all
or a significant part of the assets of a business conducted by any other Person,
or all or substantially all of the assets constituting the business of a
division, branch or other unit operation of any other Person (other than an
acquisition of assets constituting a Capital Expenditure), (c) any loan, advance
(other than deposits with financial institutions available for withdrawal on
demand, prepaid expenses (including deferred longwall panel costs), prepaid
royalties, accounts receivable and similar items made or incurred in the
ordinary course of business) or capital contribution by such Person to any other
Person, including all Indebtedness of any other Person to such Person arising
from a sale of property by such Person other than in the ordinary course of its
business, and (d) any Guaranty Obligation incurred by such Person in respect of
Indebtedness of any other Person.
"Inventory" has the meaning specified in the Pledge and Security
Agreement.
"IRS" means the Internal Revenue Service of the United States or any
successor thereto.
"Issue" means, with respect to any Letter of Credit, to issue, extend
the expiry of, renew or increase the maximum face amount (including by deleting
or reducing any scheduled decrease in such maximum face amount) of, such Letter
of Credit. The terms "Issued" and "Issuance" shall have a corresponding meaning.
"Issuer" means each Lender or Affiliate of a Lender that (a) is listed
on the signature pages hereof as an "Issuer" or (b) hereafter becomes an Issuer
with the approval of the Administrative Agent and the Borrower by agreeing
pursuant to an agreement with and in form and substance satisfactory to the
Administrative Agent and the Borrower to be bound by the terms hereof applicable
to Issuers.
"Land" of any Person means all of those plots, pieces or parcels of
land now owned, leased or hereafter acquired or leased or purported to be owned,
leased or hereafter acquired or leased (including, in respect of the Loan
Parties, as reflected in the most recent Financial Statements) by such Person.
18
"Leases" means, with respect to any Person, all of those leasehold
estates in real property of such Person, as lessee, as such may be amended,
supplemented or otherwise modified from time to time.
"Lender" means each other financial institution or other entity that
(a) is listed on the signature pages hereof as a "Lender" or (b) from time to
time becomes a party hereto by execution of an Assignment and Acceptance.
"Letter of Credit" means any letter of credit issued or deemed issued
pursuant to Section 2.3 (Letters of Credit).
"Letter of Credit Obligations" means, at any time, the aggregate of
all liabilities at such time of the Borrower to all Issuers with respect to
Letters of Credit, whether or not any such liability is contingent, including,
without duplication, the sum of (a) the Reimbursement Obligations at such time
and (b) the Letter of Credit Undrawn Amounts at such time.
"Letter of Credit Reimbursement Agreement" has the meaning specified
in Section 2.3(f) (Letters of Credit).
"Letter of Credit Request" has the meaning specified in Section 2.3(d)
(Letters of Credit).
"Letter of Credit Sublimit" means $55,000,000, or in the event the
Revolving Credit Commitments are increased pursuant to Section 2.17 (Facility
Increase), an amount equal to $55,000,000 plus the amount of the Facility
Increase that constitutes Revolving Credit Commitments to the extent a Lender or
an Affiliate of a Lender agrees to become an Issuer with respect to such
increased amount.
"Letter of Credit Support" means all cash or Cash Equivalents of any
▇▇▇▇▇▇ Entity on which an issuer of a letter of credit (other than a Letter of
Credit issued under this Agreement) issued for the account of such ▇▇▇▇▇▇ Entity
has a first priority perfected Lien as security for the obligations of a ▇▇▇▇▇▇
Entity in respect of such letter of credit.
"Letter of Credit Undrawn Amounts" means, at any time, the aggregate
undrawn face amount of all Letters of Credit outstanding at such time.
"Leverage Ratio" means, with respect to any Person as of any date, the
ratio of (a) Consolidated Financial Covenant Debt of such Person and its
Subsidiaries outstanding as of such date to (b) Consolidated EBITDA for such
Person for the last four Fiscal Quarter period ending on or before such date.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, charge, deposit arrangement, encumbrance, lien (statutory or other),
security interest or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever intended to assure
payment of any Indebtedness or the performance of any other obligation,
including any conditional sale or other title retention agreement, the interest
of a lessor under a Capital Lease and any financing lease having substantially
the same economic effect as any of the foregoing, and the filing of any
financing statement under the UCC or comparable law of any jurisdiction naming
the owner of the asset to which such Lien relates as debtor.
19
"Loan" means any loan made by any Lender pursuant to this Agreement.
"Loan Documents" means, collectively, this Agreement, the Notes (if
any), the Guaranty, the Fee Letter, each Letter of Credit Reimbursement
Agreement, the Securitization Intercreditor Agreement, each Hedging Contract
between any Loan Party and any Lender or any Affiliate of any Lender entered
into after the date hereof in connection herewith, each agreement evidencing
Cash Management Obligations, the Collateral Documents and each certificate,
agreement or document executed by a Loan Party and delivered to the
Administrative Agent or any Lender in connection with or pursuant to any of the
foregoing.
"Loan Party" means the Borrower, each Guarantor and each other ▇▇▇▇▇▇
Entity (other than a Securitization Subsidiary) that executes and delivers a
Loan Document.
"▇▇▇▇▇▇ Entity" means Holdings or any Subsidiary thereof.
"Material Adverse Change" means a material adverse change in any of
(a) the business, condition (financial or otherwise), operations, performance,
properties, contingent liabilities, material agreements, or prospects of the
▇▇▇▇▇▇ Entities taken as a whole, (b) the legality, validity or enforceability
of any Loan Document, (c) the perfection or priority of the Liens granted
pursuant to the Collateral Documents with respect to the Collateral, taken as a
whole, (d) the ability of the Borrower to repay the Obligations or of the other
Loan Parties to perform their respective obligations under the Loan Documents or
(e) the rights and remedies of the Administrative Agent, the Lenders or the
Issuers under the Loan Documents.
"Material Adverse Effect" means an effect that results in or causes,
or could reasonably be expected to result in or cause, a Material Adverse
Change.
"Material Mortgaged Lease" means those Mine Leases and Prep Plant
Leases identified on Schedule 4.22(f) hereto.
"Mine" means any excavation or opening into the earth now and
hereafter made from which Coal is or can be extracted on or from any of the
properties owned or leased by any ▇▇▇▇▇▇ Entity, together with all
appurtenances, fixtures, structures, improvements, and all tangible property of
whatsoever kind or nature in connection therewith.
"Mining Laws" means any and all applicable current and future federal,
state, local and foreign statutes, laws, regulations, guidances, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions or common law causes of
action relating to mining operations and activities. Mining Laws shall include,
but not be limited to the Federal Coal Leasing Amendments Act, the Surface
Mining Control and Reclamation Act, all other land reclamation and use statutes
and regulations, the Federal Coal Mine Health and Safety Act, the Black Lung Act
and the Coal Act, each as amended, and their state and local counterparts or
equivalents.
"Mining Lease" shall mean a Lease which provides a ▇▇▇▇▇▇ Entity the
right to mine coal reserves.
"Mining Permits" means any and all permits, licenses, registrations,
notifications, exemptions and any other authorization required under any
applicable Mining Law or otherwise necessary to recover Coal from any Mine being
operated by a ▇▇▇▇▇▇ Entity.
20
"▇▇▇▇▇'▇" means ▇▇▇▇▇'▇ Investors Services, Inc.
"Mortgage Supporting Documents" means, with respect to a Mortgage for
a parcel of Real Property, each the following:
(a) (i) lien searches in the land records for each of the Prep Plant
Leases listed on Part B of Schedule 4.22(c) (Leases) hereto and (ii) an
opinion of counsel in each state in which any such Mortgage is to be
recorded in form and substance and from counsel reasonably satisfactory to
the Administrative Agent;
(b) limited title opinions on each owned preparation plant listed on
Part A of Schedule 4.22(b) (Owned Property) hereto reasonably satisfactory
to the Administrative Agent and in substantially the same form as those
limited title opinions delivered to the Existing Lenders under the Existing
Credit Agreements;
(c) maps or plats of a current as-built survey of the parcels of Real
Property listed Part A of Schedule 4.22(b) (Owned Property) and Part B of
Schedule 4.22(c) (Leases) hereto reasonably satisfactory to the
Administrative Agent and in substantially the same form as those delivered
to the Existing Lenders under the Existing Credit Agreements dated a date
reasonably satisfactory to the Administrative Agent which maps or plats and
the surveys on which they are based shall be otherwise made in form and
substance reasonably satisfactory to the Administrative Agent;
(d) evidence in form and substance reasonably satisfactory to the
Administrative Agent that all recording fees and stamp, documentary,
intangible or mortgage taxes, if any, in connection with the Mortgage have
been paid; and
(e) such other agreements, documents and instruments in form and
substance reasonably satisfactory to the Administrative Agent as the
Administrative Agent deems necessary or appropriate to create, register or
otherwise perfect, maintain, evidence the existence, substance, form or
validity of, or enforce a valid and enforceable first priority lien on such
parcel of Real Property in favor of the Administrative Agent for the
benefit of the Secured Parties (or in favor of such other trustee as may be
required or desired under local law) subject only to (A) Liens permitted
under Section 8.2 (Liens) and (B) such other Liens as the Administrative
Agent may reasonably approve.
"Mortgages" means the mortgages, deeds of trust or other real estate
security documents made or required herein to be made by the Borrower or any
other Loan Party, each in form and substance satisfactory to the Administrative
Agent.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower, any of its Subsidiaries or any ERISA
Affiliate has any obligation or liability, contingent or otherwise.
"Net Cash Proceeds" means proceeds received by any ▇▇▇▇▇▇ Entity after
the Closing Date in cash or Cash Equivalents from any (a) Asset Sale, other than
an Asset Sale permitted under Section 8.4 (a), (b), (d), (e), (f), (g), (h), or
(j) (Sale of Assets), net of (i) the reasonable cash costs of sale, assignment
or other disposition, (ii) taxes paid or reasonably estimated to be payable as a
result thereof and (iii) any amount required to be paid or prepaid on
Indebtedness (other than the Obligations) secured by the assets subject to such
Asset Sale,
21
provided, however, that evidence of each of (i), (ii) and (iii) above is
provided to the Administrative Agent in form and substance satisfactory to it,
(b) Property Loss Event, (c) Restricted Cash Release or (d)(i) Equity Issuance
(other than any such issuance of common Stock of Holdings occurring in the
ordinary course of business to any director, member of the management or
employee of Holdings or its Subsidiaries) or (ii) any Debt Issuance other than a
Debt Issuance permitted under Section 8.1(a), Section 8.1(b), Section 8.1(c),
Section 8.1(d), Section 8.1(f), Section 8.1(h), Section 8.1(i), Section 8.1(j),
Section 8.1(n), Section 8.1(k), Section 8.1(l), Section 8.1(m)or Section 8.1(p)
(Indebtedness), in each case net of brokers' and advisors' fees and other costs
incurred in connection with such transaction; provided, however, that in the
case of this clause (c), evidence of such costs is provided to the
Administrative Agent in form and substance reasonably satisfactory to it.
"New Securities Documents" means, collectively, any indenture
governing the issuance of any unsecured notes issued as New Securities, any
unsecured notes issued as New Securities, any Constituent Document governing, or
any or shareholders agreement relating to, the issuance of any equity securities
issued as New Securities, and each other certificate, agreement or document
executed and delivered by a ▇▇▇▇▇▇ Entity to a holder of a New Security or a
trustee therefor, or otherwise in connection with or pursuant to any of the
foregoing, in each case, with market terms and conditions and pursuant to
documentation that is satisfactory to the Administrative Agent and the
Co-Syndication Agents.
"New Securities" means unsecured debt securities that are issued
and/or guaranteed solely by Holdings and/or the Borrower or any equity
securities that are issued by Holdings, in each case on market terms that are
reasonably satisfactory to the Administrative Agent and the Co-Syndication
Agents.
"Non-Cash Interest Expense" means, with respect to any Person for any
period, the sum of the following amounts to the extent included in the
definition of Interest Expense (a) the amount of debt discount and debt issuance
costs amortized, (b) charges relating to write-ups or write-downs in the book or
carrying value of existing Financial Covenant Debt, (c) interest (including
yield or similar amounts payable in connection with a Permitted Securitization)
payable in evidences of Indebtedness or by addition to the principal of the
related Indebtedness and (d) other non-cash interest.
"Non-Consenting Lender" has the meaning specified in Section 11.1(c)
(Amendments, Waivers, Etc.).
"Non-Funding Lender" has the meaning specified in Section 2.2(e)
(Borrowing Procedures).
"Non-Material Acquisition" means any Proposed Acquisition in
connection with which the aggregate consideration (as determined pursuant to
clause (e) of the definition of "Permitted Acquisition") paid by all ▇▇▇▇▇▇
Entities does not exceed $20,000,000.
"Non-Recourse Indebtedness" means Indebtedness:
(a) as to which no ▇▇▇▇▇▇ Entity (other than the Proposed Acquisition
Target) (i) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (ii) is
directly or indirectly liable as a guarantor or otherwise or (iii)
constitutes the lender;
22
(b) no default with respect to which (including any rights that the
holders of the Indebtedness may have to take enforcement action with
respect thereto) would permit upon notice, lapse of time or both any holder
of any other Indebtedness (other than the Obligations hereunder) of any
▇▇▇▇▇▇ Entity (other than the Proposed Acquisition Target) to declare a
default on such other Indebtedness or cause the payment of the Indebtedness
to be accelerated or payable prior to its stated maturity; and
(c) as to which the lenders have been notified in writing that they
will not have any recourse to the stock or assets of any ▇▇▇▇▇▇ Entity
(other than the Proposed Acquisition Target).
"Non-U.S. Lender" means each Lender or Issuer (or the Administrative
Agent) that is not a United States person as defined in Section 7701(a)(30) of
the Code.
"Non-U.S. Subsidiary" means each Subsidiary of Holdings that is not a
Domestic Person.
"Note" means any Revolving Credit Note or Term Loan Note.
"Notice of Borrowing" has the meaning specified in Section 2.2(a)
(Borrowing Procedures).
"Notice of Conversion or Continuation" has the meaning specified in
Section 2.10 (Conversion/Continuation Option).
"Obligations" means the Loans, the Letter of Credit Obligations and
all other amounts, obligations, covenants and duties owing by the Borrower to
the Administrative Agent, any Lender, any Issuer, any Affiliate of any of them
or any Indemnitee, of every type and description (whether by reason of an
extension of credit, opening or amendment of a letter of credit or payment of
any draft drawn or other payment thereunder, loan, guaranty, indemnification,
foreign exchange or currency swap transaction, interest rate hedging transaction
or otherwise), present or future, arising under this Agreement, any other Loan
Document (including Cash Management Documents and Hedging Contracts that are
Loan Documents), whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired and whether or not evidenced by any note,
guaranty or other instrument or for the payment of money, including all letter
of credit, cash management and other fees, interest, charges, expenses,
attorneys' fees and disbursements, Cash Management Obligations and other sums
chargeable to the Borrower under this Agreement, any other Loan Document
(including Cash Management Documents and Hedging Contracts that are Loan
Documents) and all obligations of the Borrower under any Loan Document to
provide cash collateral for Letter of Credit Obligations.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Permit" means any permit, approval, authorization, license, variance
or permission required from a Governmental Authority under an applicable
Requirement of Law.
"Permitted Acquisition" means any Proposed Acquisition subject to the
satisfaction of each of the following conditions:
23
(a) the Administrative Agent shall receive at least 15 days' (or such
later date as shall be consented to by the Administrative Agent) prior
written notice of any such Proposed Acquisition (other than a Non-Material
Acquisition), which notice shall include, without limitation, a reasonably
detailed description of such Proposed Acquisition;
(b) such Proposed Acquisition shall only involve assets located in the
United States and comprising a business, or assets of a business, of the
type engaged in by the Borrower and its Subsidiaries as of the Closing Date
or any Similar Business;
(c) such Proposed Acquisition shall be consensual and if legally
required shall have been approved by the Proposed Acquisition Target's
board of directors;
(d) no additional Indebtedness or other liabilities shall be incurred,
assumed or otherwise be reflected on a Consolidated balance sheet of
Holdings and the Proposed Acquisition Target after giving effect to such
Proposed Acquisition, except (i) Loans made hereunder, (ii) ordinary course
trade payables, and accrued expenses, (iii) ordinary course reclamation,
black lung, workers compensation and other employee benefits and (iv)
Indebtedness permitted under Section 8.1 (Indebtedness);
(e) all consideration paid in connection with such acquisition
(including all transaction costs and all Indebtedness, Working Capital (to
the extent negative), non-current liabilities and Guaranty Obligations
incurred or assumed in connection therewith or otherwise reflected in a
Consolidated balance sheet of Holdings and the Proposed Acquisition Target)
shall not exceed, together with all other Permitted Acquisitions, an
aggregate amount equal to 7.5% of Holdings' Consolidated Total Assets
during the term of the Facilities; provided, however, that at any time that
Holdings has a Leverage Ratio of 3.0:1 or less (determined for the most
recent Fiscal Period for which Financial Statements have been delivered
pursuant to Section 6.1 (Financial Statements)), the foregoing 7.5% shall
be increased to 12.5%; provided further, however, that such increase shall
be eliminated at any time that Holdings' Leverage Ratio exceeds 3.0:1
(determined for the most recent Fiscal Period for which Financial
Statements have been delivered pursuant to Section 6.1 (Financial
Statements));
(f) at or prior to the closing of such Proposed Acquisition, the
▇▇▇▇▇▇ Entity making such Proposed Acquisition and the Proposed Acquisition
Target shall have executed such documents and taken such actions as may be
required under Section 7.16 (Additional Collateral and Guaranties);
(g) the Borrower shall have delivered to the Administrative Agent, in
form and substance satisfactory to the Administrative Agent and the
Requisite Lenders and sufficiently in advance and in any case no later than
10 days prior to such Proposed Acquisition (other than a Non-Material
Acquisition) (or such earlier date as shall be consented to by the
Administrative Agent), such other financial information, financial
analysis, documentation or other information relating to such Proposed
Acquisition as the Administrative Agent or any Lender shall reasonably
request;
(h) on or prior to the date of such Proposed Acquisition (other than a
Non-Material Acquisition), the Administrative Agent shall have received, in
form and substance reasonably satisfactory to the Administrative Agent,
copies of the acquisition
24
agreement, related Contractual Obligations and instruments and all
opinions, certificates, lien search results and other documents reasonably
requested by the Administrative Agent; and
(i) at the time of such Proposed Acquisition and after giving effect
thereto, (i) no Default or Event of Default shall have occurred and be
continuing and (ii) all representations and warranties contained in Article
IV (Representations and Warranties) and in the other Loan Documents shall
be true and correct in all material respects.
"Permitted Joint Venture" means a Person (a) that is a corporation,
limited liability company, limited partnership, joint venture or similar limited
liability legal entity hereafter formed or entered into by the Borrower or any
of its Subsidiaries with another Person in order to conduct a common venture or
enterprise; (b) that is engaged in the same business as the Borrower or such
Subsidiary on the Closing Date or a Similar Business; and (c) in respect of
which the maximum amount of all obligations (in each case whether contingent or
otherwise), including any contractually binding commitment to make future
capital contributions, assumed by any Loan Party in respect thereof can be
quantified.
"Permitted Reorganization" means (a) the merger or consolidation of
any Wholly-Owned Subsidiary of Holdings with any other Wholly-Owned Subsidiary
of Holdings, or (b) the acquisition of all or substantially all of the Stock or
Stock Equivalents of any Wholly-Owned Subsidiary of Holdings, or all or
substantially all of the assets of any Wholly-Owned Subsidiary of Holdings or
all or substantially all of the assets constituting the business of a division,
branch or other unit operation of any Wholly-Owned Subsidiary of Holdings, in
each case by another Wholly-Owned Subsidiary of Holdings, provided, that in each
case, after giving effect to such merger, consolidation or acquisition, each
such Subsidiary is a Wholly-Owned Subsidiary of Holdings, in the case of any
merger with the Borrower, the Borrower is the surviving entity, Holdings and the
Borrower are in compliance with Section 7.16 (Additional Collateral and
Guaranties), the Investment in such Subsidiary is permitted under Section 8.3(e)
(Investments) and the interests of the Administrative Agent or the Lenders under
the Loan Documents are not otherwise impaired.
"Permitted Securitization" means one or more financings of not more
than $100,000,000 in aggregate principal amount at any one time outstanding
obtained by Holdings or any of its Subsidiaries through (i) the Blue Ridge
Securitization and (ii) any other asset-backed securitizations provided by an
arranger selected by Holdings or the relevant Subsidiary and reasonably
acceptable to the Administrative Agent.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, estate, trust, limited liability company,
unincorporated association, joint venture or other entity, or a Governmental
Authority.
"Pledge and Security Agreement" means an agreement, in substantially
the form of Exhibit H (Form of Pledge and Security Agreement), executed by the
Borrower and each Guarantor.
"Pledged Notes" has the meaning specified in the Pledge and Security
Agreement.
25
"Pledged Stock" has the meaning specified in the Pledge and Security
Agreement.
"PNC" has the meaning specified in the preamble to this Agreement.
"Prep Plant Lease" means each Lease entered into by a ▇▇▇▇▇▇ Entity in
respect of a preparation plant and/or related property or Real Property on which
a preparation plant is situated.
"Pro Forma Basis" means, with respect to any determination for any
period, that such determination shall be made giving pro forma effect to each
acquisition consummated during such period, together with all transactions
relating thereto consummated during such period (including any incurrence,
assumption, refinancing or repayment of Indebtedness), as if such acquisition
and related transactions had been consummated on the first day of such period,
in each case based on historical results accounted for in accordance with GAAP
and, to the extent applicable, reasonable assumptions that are specified in
details in the relevant Compliance Certificate, Financial Statement or other
document provided to the Administrative Agent or any Lender in connection
herewith in accordance with Regulation S-X of the Securities Act of 1933.
"Projections" means those financial projections dated May 2003,
covering the fiscal years ending in 2003 through 2007 inclusive, delivered to
the Lenders by the Borrower.
"Property Loss Event" means (a) any loss of or damage to property of
Holdings or any of its Subsidiaries that results in the receipt by such Person
of proceeds of insurance (excluding, in any event, (i) proceeds of casualty
insurance received after the date of this Agreement relating to the ▇▇▇▇▇▇
County Coal Corporation impoundment breach in October 2000 in an aggregate
amount not in excess of $5,000,000 and (ii) proceeds of business interruption
and liability insurance) in excess of $5,000,000 individually or $10,000,000 in
the aggregate or (b) any taking of property of Holdings or any of its
Subsidiaries that results in the receipt by such Person of a compensation
payment in respect thereof in excess of $5,000,000 individually or $10,000,000
in the aggregate.
"Proposed Change" has the meaning specified in Section 11.1(c)
(Amendments, Waivers, Etc.).
"Proposed Acquisition" means the proposed acquisition by the Borrower
or any of its Subsidiaries of all or any part of the assets or Stock of any
Proposed Acquisition Target, or the merger of any Proposed Acquisition Target
with or into the Borrower or any Subsidiary of the Borrower (and, in the case of
a merger with the Borrower, with the Borrower being the surviving corporation).
"Proposed Acquisition Target" means any Person or any operating
division thereof subject to a Proposed Acquisition.
"Protective Advances" means all expenses, disbursements and advances
incurred by the Administrative Agent pursuant to the Loan Documents after the
occurrence and during the continuance of an Event of Default that the
Administrative Agent, in its sole discretion, deems necessary or desirable to
preserve or protect the Collateral or any portion thereof or to enhance the
likelihood, or maximize the amount, of repayment of the Obligations.
26
"Purchasing Lender" has the meaning specified in Section 11.7 (Sharing
of Payments, Etc.).
"Ratable Portion" or "ratably" (other than in the expression "equally
and ratably") means, with respect to any Lender, (a) with respect to the
Revolving Credit Facility, the percentage obtained by dividing (i) the Revolving
Credit Commitment of such Lender by (ii) the aggregate Revolving Credit
Commitments of all Lenders (or, at any time after the Revolving Credit
Termination Date, the percentage obtained by dividing the aggregate outstanding
principal balance of the Revolving Credit Outstandings owing to such Lender by
the aggregate outstanding principal balance of the Revolving Credit Outstandings
owing to all Lenders) and (b) with respect to the Term Loan Facility, the
percentage obtained by dividing (i) the Term Loan Commitment of such Lender by
(ii) the aggregate Term Loan Commitments of all Lenders (or, at any time after
the Closing Date, the percentage obtained by dividing the principal amount of
such Lender's Term Loans by the aggregate Term Loans of all Lenders).
"Real Property" of any Person means the Land of such Person, together
with the right, title and interest of such Person, if any, in and to the
streets, the Land lying in the bed of any streets, roads or avenues, opened or
proposed, in front of, the air space and development rights pertaining to the
Land and the right to use such air space and development rights, all rights of
way, privileges, liberties, tenements, hereditaments and appurtenances belonging
or in any way appertaining thereto, all fixtures, all easements now or hereafter
benefiting the Land and all royalties and rights appertaining to the use and
enjoyment of the Land, including all alley, vault, drainage, mineral, water, oil
and gas rights, together with all of the buildings and other improvements now or
hereafter erected on the Land and any fixtures appurtenant thereto.
"Receivable" means any indebtedness and other obligations owed to any
Loan Party as assignee of any Loan Party, or any right of any Loan Party to
payment from or on behalf of, an Account Debtor), whether constituting an
Account, Chattel Paper, Instrument or General Intangible arising in connection
with the sale of goods or the rendering of services by any Loan Party or any
Subsidiary thereof, and includes the obligation to pay any finance charges, fees
and other charges with respect thereto.
"Register" has the meaning specified in Section 11.2(c) (Assignments
and Participations).
"Reimbursement Date" has the meaning specified in Section 2.3(i)
(Letters of Credit).
"Reimbursement Obligations" means, as and when matured, the obligation
of the Borrower to pay, on the date payment is made or scheduled to be made to
the beneficiary under each such Letter of Credit (or at such other date as may
be specified in the applicable Letter of Credit Reimbursement Agreement) and in
the currency drawn (or in such other currency as may be specified in the
applicable Letter of Credit Reimbursement Agreement), all amounts of each drafts
and other requests for payments drawn under Letters of Credit, and all other
matured reimbursement or repayment obligations of the Borrower to any Issuer
with respect to amounts drawn under Letters of Credit.
"Reinvestment Deferred Amount" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the portion of such Net Cash Proceeds
subject to a Reinvestment Notice.
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"Reinvestment Event" means any Asset Sale (other than in connection
with a sale and lease/back transaction) or Property Loss Event in respect of
which the Borrower has delivered a Reinvestment Notice.
"Reinvestment Notice" means a written notice executed by a Responsible
Officer of the Borrower stating that no Default or Event of Default has occurred
and is continuing and that the Borrower (directly or indirectly through one of
its Subsidiaries) intends and expects to use all or a specified portion of the
Net Cash Proceeds of an Asset Sale or Property Loss Event to acquire replacement
assets useful in its or one of its Subsidiaries' businesses or, in the case of a
Property Loss Event, to effect repairs.
"Reinvestment Prepayment Amount" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the Reinvestment Deferred Amount for such
Net Cash Proceeds less any amount expended or required to be expended pursuant
to a Contractual Obligation entered into prior to the relevant Reinvestment
Prepayment Date for such Net Cash Proceeds to acquire, to the extent otherwise
permitted hereunder, replacement assets useful in the business of the Borrower
or any of its Subsidiaries or, in the case of a Property Loss Event, to effect
repairs.
"Reinvestment Prepayment Date" means, with respect to any Net Cash
Proceeds of any Reinvestment Event, the earlier of (a) the date occurring 270
days after such Reinvestment Event and (b) the date that is five Business Days
after the date on which the Borrower shall have notified the Administrative
Agent of the Borrower's determination not to acquire replacement assets useful
in the Borrower's or a Subsidiary's business (or, in the case of a Property Loss
Event, not to effect repairs) with all or any portion of the relevant
Reinvestment Deferred Amount for such Net Cash Proceeds.
"Related Security" means, with respect to any Receivable: (a) all of
each Loan Party's interest in any goods (including returned goods), and
documentation of title evidencing the shipment or storage of any goods
(including returned goods), relating to any sale giving rise to such Receivable,
(b) all Instruments and Chattel Paper that may evidence such Receivable, (c) all
other Liens and property subject thereto from time to time purporting to secure
payment of such Receivable, whether pursuant to the Sales Contract related to
such Receivable or otherwise, together with all UCC financing statements or
similar filings relating thereto, and (d) all of each Loan Party's rights,
interests and claims under the Sales Contracts and all guaranties, indemnities
and other agreements (including the related Sales Contract) or arrangements of
whatever character from time to time supporting or securing payment of such
Receivable or otherwise relating to such Receivable, whether pursuant to the
Sales Contract related to such Receivable or otherwise.
"Release" means, with respect to any Person, any release, spill,
emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal,
leaching or migration, in each case, of any Contaminant into the environment or
into or out of any property owned by such Person, including the movement of
Contaminants through or in the air, soil, surface water, ground water or
property.
"Remedial Action" means all actions required to (a) clean up, remove,
treat or in any other way address the Release of any Contaminant in the
environment, (b) prevent the Release or threat of Release or minimize the
further Release so that a Contaminant does not
28
migrate or endanger or threaten to endanger public health or welfare or the
environment or (c) perform pre-remedial studies and investigations and
post-remedial monitoring and care.
"Requirement of Law" means, with respect to any Person, the common law
and all federal, state, local and foreign laws, rules and regulations, orders,
judgments, decrees and other determinations of any Governmental Authority or
arbitrator, applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.
"Requisite Lenders" means, collectively, Lenders having more than
fifty percent (50%) of the sum of (a) the aggregate outstanding amount of the
Revolving Credit Commitments or, after the Revolving Credit Termination Date,
the aggregate Revolving Credit Outstandings and (b) the aggregate outstanding
amount of the Term Loan Commitments or, after the Closing Date, the principal
amount of all Term Loans then outstanding. A Non-Funding Lender shall not be
included in the calculation of "Requisite Lenders."
"Requisite Revolving Credit Lenders" shall mean Revolving Credit
Lenders having more than fifty percent (50%) of the aggregate outstanding amount
of the Revolving Credit Commitments or, after the Revolving Credit Termination
Date, fifty percent (50 %) of the aggregate Revolving Credit Outstandings. A
Non-Funding Lender shall not be included in the calculation of "Requisite
Revolving Credit Lenders."
"Requisite Term Loan Lenders" means Term Loan Lenders having more than
50% of the aggregate outstanding amount of the Term Loan Commitments or, after
the Closing Date, fifty percent (50%) of the principal amount of all Term Loans
then outstanding.
"Responsible Officer" means, with respect to any Person, any of the
principal executive officers, managing members or general partners of such
Person but, in any event, with respect to financial matters, the chief financial
officer, treasurer or controller of such Person.
"Restricted Cash" means cash or Cash Equivalents which are proceeds of
the Term Loans and which have been segregated from all other cash and Cash
Equivalents of the Borrower and placed on deposit in an Approved Deposit Account
or a Control Account (which accounts shall not contain any other funds) in
respect of which the Administrative Agent has a first priority perfected Lien to
secure payment of the Secured Obligations. For the avoidance of doubt, it is
acknowledged and agreed that in no event shall "Restricted Cash" include any
Letter of Credit Support.
"Restricted Cash Release" means the release of (a) Restricted Cash
from the Deposit Account or Control Account in respect of which the
Administrative Agent has a first priority perfected Lien or (b) cash or Cash
Equivalents that constitute Letter of Credit Support from the first priority
perfected Lien of a letter of credit issuer, to the extent such cash or Cash
Equivalents do not, or no longer, constitute Collateral or Letter of Credit
Support, up to an aggregate amount equal to $100,000,000.
"Restricted Payment" means (a) any dividend, distribution or any other
payment whether direct or indirect, on account of any Stock or Stock Equivalents
of Holdings or any of its Subsidiaries now or hereafter outstanding and (b) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any Stock or Stock Equivalents of
Holdings or any of its Subsidiaries now or hereafter outstanding.
29
"Retiree Medical Plan" means any employee welfare benefit plan, as
defined in Section 3(1) of ERISA, which provides benefits to retirees or their
dependents with the exception of any plan where such benefits are provided
solely pursuant to the Consolidated Omnibus Reconciliation Act of 1985.
"Revolving Credit Borrowing" means Revolving Loans made on the same
day by the Revolving Credit Lenders ratably according to their respective
Revolving Credit Commitments.
"Revolving Credit Commitment" means, with respect to each Revolving
Credit Lender, the commitment of such Revolving Credit Lender to make Revolving
Loans and acquire interests in other Revolving Credit Outstandings in the
aggregate principal amount outstanding not to exceed the amount set forth
opposite such Revolving Credit Lender's name on Schedule I (Commitments) under
the caption "Revolving Credit Commitment," as amended to reflect each Assignment
and Acceptance executed by such Revolving Credit Lender and as such amount may
be reduced pursuant to this Agreement.
"Revolving Credit Facility" means the Revolving Credit Commitments and
the provisions herein related to the Revolving Loans and Letters of Credit.
"Revolving Credit Lender" means each Lender having a Revolving Credit
Commitment.
"Revolving Credit Note" means a promissory note of the Borrower
payable to the order of any Revolving Credit Lender in a principal amount equal
to the amount of such Revolving Credit Lender's Revolving Credit Commitment
evidencing the aggregate Indebtedness of the Borrower to such Revolving Credit
Lender resulting from the Revolving Loans owing to such Revolving Credit Lender.
"Revolving Credit Outstandings" means, at any particular time, the sum
of (a) the principal amount of the Revolving Loans outstanding at such time and
(b) the Letter of Credit Obligations outstanding at such time.
"Revolving Credit Termination Date" shall mean the earliest of (a) the
Scheduled Termination Date, (b) the date of termination of the Revolving Credit
Commitments pursuant to Section 2.4 (Reduction and Termination of the Revolving
Credit Commitments) and (c) the date on which the Obligations become due and
payable pursuant to Section 9.2 (Remedies).
"Revolving Loan" has the meaning specified in Section 2.1(a) (The
Commitments).
"S&P" means Standard & Poor's Rating Services.
"Sales Contract" means, with respect to any Receivable, any and all
sales contracts, purchase orders, instruments, agreements, leases, invoices,
notes or other writings pursuant to which such Receivable arises or that
evidence such Receivable or under which an Account Debtor becomes or is
obligated to make payment in respect of such Receivable.
"▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act" means the Federal ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
30
"Scheduled Termination Date" means January 1, 2007.
"Secured Financial Covenant Debt" of any Person means Financial
Covenant Debt of such Person to the extent a ▇▇▇▇▇▇ Entity has granted a Lien to
secure such Indebtedness; provided that, in no event, shall Secured Financial
Covenant Debt include Indebtedness incurred in connection with any Permitted
Securitization.
"Secured Leverage Ratio" means, with respect to any Person as of any
date, the ratio of (a) Consolidated Secured Financial Covenant Debt of such
Person and its Subsidiaries outstanding as of such date to (b) Consolidated
EBITDA for such Person for the last four Fiscal Quarter period ending on or
before such date.
"Secured Obligations" means, in the case of the Borrower, the
Obligations, and, in the case of any other Loan Party, the obligations of such
Loan Party under the Guaranty and the other Loan Documents to which it is a
party.
"Secured Parties" means the Lenders, the Issuers, the Administrative
Agent and any other holder of any Secured Obligation.
"Securitization Assets" means all existing or hereafter acquired or
arising (i) Receivables of the Borrower or any of its Subsidiaries that are
sold, assigned or otherwise transferred pursuant to a Permitted Securitization
Facility, (ii) the Related Security with respect to the Receivables referred to
in clause (i) above, (iii) the collections and proceeds of the Receivables and
Related Security referred to in clauses (i) and (ii) above, (iv) all lockboxes,
lockbox accounts, collection accounts or other deposit accounts into which such
collections are deposited and which have been specifically identified and
consented to by the Administrative Agent, and (v) all other rights and payments
which relate solely to such Receivables.
"Securitization Intercreditor Agreement" means the intercreditor
agreement dated as of July 2, 2003 and entered into by the Borrower, Holdings,
▇▇▇▇▇▇ Coal Sales Company, Inc., Central West Virginia Energy Company, Central
Penn Energy Company, Inc., ▇▇▇▇▇▇ Receivables Corporation, Wachovia Bank,
National Association, as receivables agent, and the Administrative Agent.
"Securitization Subsidiary" means ▇▇▇▇▇▇ Receivables Corporation, a
Delaware corporation or any other special purpose financing subsidiary
established by Holdings for the sole purpose of consummating one or more
Permitted Securitization Facilities and in respect of which neither Holdings nor
any Subsidiary of Holdings has any obligation to maintain or preserve such
Securitization Subsidiary's financial condition or cause such Securitization
Subsidiary to achieve specified levels of operating results.
"Security" means any Stock, Stock Equivalent, voting trust
certificate, bond, debenture, note or other evidence of Indebtedness, whether
secured, unsecured, convertible or subordinated, or any certificate of interest,
share or participation in, any temporary or interim certificate for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire, any of the
foregoing, but shall not include any evidence of the Obligations.
"Selling Lender" has the meaning specified in Section 11.7 (Sharing of
Payments, Etc.).
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"6.95% Indenture" means the Indenture, dated as of February 18, 1997,
between Holdings (formerly Fluor Corporation) and Deutsche Bank Trust Company
Americas, as Trustee, as supplemented in accordance with the terms hereof.
"6.95% Notes" means Holdings' 6.95% Senior Notes due March 1, 2007
issued under the 6.95% Indenture in an aggregate outstanding principal amount of
$283,000,000.
"Similar Business" means coal production, mining, power/energy sales,
other energy businesses, and businesses reasonably similar thereto or a
reasonable extension, development or expansion thereof or ancillary thereto.
"Solvent" means, with respect to any Person as of any date of
determination, that, as of such date, (a) the value of the assets of such Person
(both at fair value and present fair saleable value) is greater than the total
amount of liabilities (including contingent and unliquidated liabilities) of
such Person, (b) such Person is able to pay all liabilities of such Person as
such liabilities mature and (c) such Person does not have unreasonably small
capital. In computing the amount of contingent or unliquidated liabilities at
any time, such liabilities shall be computed at the amount that, 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.
"Special Purpose Vehicle" means any special purpose funding vehicle
identified as such in writing by any Lender to the Administrative Agent.
"Standby Letter of Credit" means any Letter of Credit that is not a
Documentary Letter of Credit.
"Stock" means shares of capital stock (whether denominated as common
stock or preferred stock), beneficial, partnership or membership interests,
participations or other equivalents (regardless of how designated) of or in a
corporation, partnership, limited liability company or equivalent entity,
whether voting or non-voting.
"Stock Equivalents" means all securities convertible into or
exchangeable for Stock and all warrants, options or other rights to purchase or
subscribe for any Stock, whether or not presently convertible, exchangeable or
exercisable.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, limited liability company or other business entity of which an
aggregate of 50% or more of the outstanding Voting Stock is, at the time,
directly or indirectly, owned or controlled by such Person or one or more
Subsidiaries of such Person.
"Subsidiary Guarantor" means each Subsidiary of the Borrower (other
than a Securitization Subsidiary and Coalsolv, LLC) party to or that becomes
party to the Guaranty.
"Substitute Institution" has the meaning specified in Section 2.16
(Substitution of Lenders).
"Substitution Notice" has the meaning specified in Section 2.16
(Substitution of Lenders).
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"Syndication Completion Date" means the earlier to occur of (a) the
21st day following the Closing Date and (b) the date upon which the
Administrative Agent determines in its sole discretion that the primary
syndication of the Term Loans has been completed.
"Tax Affiliate" means, with respect to any Person, (a) any Subsidiary
of such Person, and (b) any Affiliate of such Person with which such Person
files or is eligible to file consolidated, combined or unitary tax returns.
"Tax Return" has the meaning specified in Section 4.8(a) (Taxes).
"Taxes" has the meaning specified in Section 2.15 (Taxes).
"Term Loan" has the meaning specified in Section 2.1(b) (The
Commitments).
"Term Loan Borrowing" means Term Loans made on the same day by the
Term Loan Lenders ratably according to their respective Term Loan Commitments.
"Term Loan Commitment" means, with respect to each Term Loan Lender,
the commitment of such Lender to make Term Loans to the Borrower in the
aggregate principal amount outstanding not to exceed the amount set forth
opposite such Lender's name on Schedule I (Commitments) under the caption "Term
Loan Commitment" as amended to reflect each Assignment and Acceptance executed
by such Lender and as such amount may be reduced pursuant to this Agreement.
"Term Loan Facility" means the Term Loan Commitments and the
provisions herein related to the Term Loans.
"Term Loan Lender" means each Lender having a Term Loan Commitment.
"Term Loan Maturity Date" means January 1, 2007; provided, however,
that if on or prior to January 1, 2007, the 6.95% Notes shall have been
refinanced on terms and conditions reasonably satisfactory to the Agents, the
"Term Loan Maturity Date" shall be the date which is the 5th anniversary of the
Closing Date.
"Term Loan Note" means a promissory note of the Borrower payable to
the order of any Term Loan Lender in a principal amount equal to the amount of
such Lender's Term Loan Commitment evidencing the Indebtedness of the Borrower
to such Lender resulting from the Term Loan owing to such Lender.
"Title IV Plan" means a pension plan, other than a Multiemployer Plan,
covered by Title IV of ERISA and to which the Borrower any of its Subsidiaries
or any ERISA Affiliate has any obligation or liability (contingent or
otherwise).
"Total Assets" means the total assets of Holdings as shown on the most
recent Consolidated balance sheet that has been delivered to the Lenders
pursuant to Section 6.1 (Financial Statements).
"UBS" has the meaning specified in the preamble to this Agreement.
"UCC" has the meaning specified in the Pledge and Security Agreement.
33
"Unfunded Pension Liability" means, with respect to Holdings or any of
its Subsidiaries at any time, the sum of (a) the amount, if any, by which the
present value of all accrued benefits under each Title IV Plan (other than any
Title IV Plan subject to Section 4063 of ERISA) exceeds the fair market value of
all assets of such Title IV Plan allocable to such benefits in accordance with
Title IV of ERISA, as determined as of the most recent valuation date for such
Title IV Plan using the actuarial assumptions in effect under such Title IV
Plan, (b) the aggregate amount of withdrawal liability that could be assessed
under Section 4063 with respect to each Title IV Plan subject to such section,
separately calculated for each such Title IV Plan as of its most recent
valuation date and (c) for a period of five years following a transaction
reasonably likely to be covered by Section 4069 of ERISA, the liabilities
(whether or not accrued) that could be avoided by Holdings, any of its
Subsidiaries or any ERISA Affiliate as a result of such transaction.
"Unused Commitment Fee" has the meaning specified in Section 2.11(a)
(Fees).
"Voting Stock" means Stock of any Person having ordinary power to vote
in the election of members of the board of directors, managers, trustees or
other controlling Persons, of such Person (irrespective of whether, at the time,
Stock of any other class or classes of such entity shall have or might have
voting power by reason of the happening of any contingency).
"Westvaco" means the Coal Handling Facility constructed at Westvaco
Corporation's Covington, Virginia plant and all integrally related tangible and
intangible assets, including leases, coal handling agreements, service
agreements and transportation agreements.
"Wholly-Owned Subsidiary" means, in respect of any Person, any
Subsidiary of such Person, all of the Stock of which (other than director's
qualifying shares, as may be required by law) is owned by such Person, either
directly or indirectly through one or more Wholly-Owned Subsidiaries of such
Person.
"Withdrawal Liability" means, with respect to Holdings or any of its
Subsidiaries at any time, the aggregate liability incurred (whether or not
assessed) with respect to all Multiemployer Plans pursuant to Section 4201 of
ERISA or for increases in contributions required to be made pursuant to Section
4243 of ERISA.
"Working Capital" means, for any Person at any date, the Consolidated
Current Assets of such Person less the Consolidated Current Liabilities of such
Person.
Section 1.2 Computation of Time Periods
In this Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each mean "to but excluding" and the
word "through" means "to and including."
Section 1.3 Accounting Terms and Principles
(a) Except as set forth below, all accounting terms not specifically
defined herein shall be construed in conformity with GAAP and all accounting
determinations required to be made pursuant hereto (including for purpose of
measuring compliance with Article V (Financial Covenants)) shall, unless
expressly otherwise provided herein, be made in conformity with GAAP.
34
(b) If any change in the accounting principles used in the preparation
of the most recent Financial Statements referred to in Section 6.1 (Financial
Statements) is hereafter required or permitted by the rules, regulations,
pronouncements and opinions of the Financial Accounting Standards Board or the
American Institute of Certified Public Accountants (or any successors thereto)
and such change is adopted by Holdings with the agreement of the Holdings'
Accountants and results in a change in any of the calculations required by
Article V (Financial Covenants) or VIII (Negative Covenants) had such accounting
change not occurred, the parties hereto agree to enter into negotiations in
order to amend such provisions so as to equitably reflect such change with the
desired result that the criteria for evaluating compliance with such covenants
by Holdings shall be the same after such change as if such change had not been
made; provided, however, that no change in GAAP that would affect a calculation
that measures compliance with any covenant contained in Article V (Financial
Covenants) or VIII (Negative Covenants) shall be given effect until such
provisions are amended to reflect such changes in GAAP.
(c) For purposes of making all financial calculations to determine
compliance with Article V (Financial Covenants), all components of such
calculations shall be adjusted to include or exclude, as the case may be,
without duplication, such components of such calculations attributable to any
business or assets that have been acquired by Holdings or any of its
Subsidiaries (including through Permitted Acquisitions) after the first day of
the applicable period of determination and prior to the end of such period, as
determined in good faith by Holdings on a Pro Forma Basis.
Section 1.4 Certain Terms
(a) The terms "herein," "hereof," "hereto" and "hereunder" and similar
terms refer to this Agreement as a whole, and not to any particular Article,
Section, subsection or clause in, this Agreement.
(b) Unless otherwise expressly indicated herein, (i) references in
this Agreement to an Exhibit, Schedule, Article, Section, clause or sub-clause
refer to the appropriate Exhibit or Schedule to, or Article, Section, clause or
sub-clause in this Agreement and (ii) the words "above" and "below", when
following a reference to a clause or a sub-clause of any Loan Document, refer to
a clause or sub-clause within, respectively, the same Section or clause.
(c) Each agreement defined in this Article I shall include all
appendices, exhibits and schedules thereto. Unless the prior written consent of
the Requisite Lenders is required hereunder for an amendment, restatement,
supplement or other modification to any such agreement and such consent is not
obtained, references in this Agreement to such agreement shall be to such
agreement as so amended, restated, supplemented or modified.
(d) References in this Agreement to any statute shall be to such
statute as amended or modified from time to time and to any successor
legislation thereto, in each case as in effect at the time any such reference is
operative.
(e) The term "including" when used in any Loan Document means
"including without limitation" except when used in the computation of time
periods.
(f) The terms "Lender," "Issuer," "Administrative Agent," "Agents,"
"Co-Syndication Agents" and "Arranger" include, without limitation, their
respective successors.
35
(g) Upon the appointment of any successor Administrative Agent
pursuant to Section 10.7 (Successor Administrative Agent), references to CNAI in
Section 10.3 (Posting of Approved Electronic Communications) and to Citibank in
the definitions of Base Rate, Eurodollar Rate shall be deemed to refer to the
financial institution then acting as the Administrative Agent or one of its
Affiliates if it so designates.
ARTICLE II
The Facilities
Section 2.1 The Commitments
(a) Revolving Credit Commitments. On the terms and subject to the
conditions contained in this Agreement, each Revolving Credit Lender severally
agrees to make loans (each a "Revolving Loan") in Dollars to the Borrower from
time to time on any Business Day during the period from the date hereof until
the Revolving Credit Termination Date in an aggregate principal amount at any
time outstanding for all such loans by such Revolving Credit Lender not be
exceed such Revolving Credit Lender's Revolving Credit Commitment; provided,
however, that at no time shall any Revolving Credit Lender be obligated to make
a Revolving Loan in excess of such Revolving Credit Lender's Ratable Portion of
the Available Credit. Within the limits of the Revolving Credit Commitment of
each Revolving Credit Lender, amounts of Revolving Loans repaid may be
reborrowed under this Section 2.1.
(b) Term Loan Commitments. On the terms and subject to the conditions
contained in this Agreement, each Term Loan Lender severally agrees to make a
loan (each a "Term Loan") in Dollars to the Borrower on the Closing Date, in an
amount not to exceed such Lender's Term Loan Commitment. Amounts of Term Loans
prepaid may not be reborrowed.
Section 2.2 Borrowing Procedures
(a) Each Revolving Credit Borrowing shall be made on notice given by
the Borrower to the Administrative Agent not later than 11:00 a.m. (New York
time) (i) the same Business Day, in the case of a Revolving Credit Borrowing of
Base Rate Loans and (ii) three Business Days, in the case of a Revolving Credit
Borrowing of Eurodollar Rate Loans, prior to the date of the proposed Revolving
Credit Borrowing. Each such notice shall be in substantially the form of Exhibit
C (Form of Notice of Borrowing) (a "Notice of Borrowing"), specifying (A) the
date of such proposed Revolving Credit Borrowing, (B) the aggregate amount of
such proposed Revolving Credit Borrowing, (C) whether any portion of the
proposed Revolving Credit Borrowing will be of Base Rate Loans or Eurodollar
Rate Loans, and (D) the initial Interest Period or Periods for any such
Eurodollar Rate Loans. The Revolving Loans shall be made as Base Rate Loans
unless, in the case of a Revolving Credit Borrowing occurring after the Closing
Date and subject to Section 2.13 (Special Provisions Governing Eurodollar Rate
Loans), the Notice of Borrowing specifies that all or a portion thereof shall be
Eurodollar Rate Loans. Each Revolving Credit Borrowing shall be in an aggregate
amount of not less than $5,000,000 or an integral multiple of $1,000,000 in
excess thereof.
(b) The Term Loan Borrowing shall be made upon receipt of a Notice of
Borrowing given by the Borrower to the Administrative Agent not later than 11:00
a.m. (New York City time) one Business Day prior to the Closing Date. The Notice
of Borrowing shall specify (A) the Closing Date, (B) the aggregate amount of
such proposed Term Loan Borrowing,
36
and (C) the initial Interest Period or Periods for any such Eurodollar Rate
Loans. The Term Loans shall be made initially as Base Rate Loans.
(c) The Administrative Agent shall give to each Lender prompt notice
of the Administrative Agent's receipt of a Notice of Borrowing and, if
Eurodollar Rate Loans are properly requested in such Notice of Borrowing, the
applicable interest rate determined pursuant to Section 2.13(a) (Determination
of Interest Rate). Each Lender shall, before 2:00 p.m. (New York time) on the
date of the proposed Borrowing, make available to the Administrative Agent at
its address referred to in Section 11.8 (Notices, Etc.), in immediately
available funds, such Lender's Ratable Portion of such proposed Borrowing. Upon
fulfillment (or due waiver in accordance with Section 11.1 (Amendments, Waivers,
Etc.)) (i) on the Closing Date, of the applicable conditions set forth in
Section 3.1 (Conditions Precedent to Initial Loans and Letters of Credit) and
(ii) at any time (including the Closing Date), of the applicable conditions set
forth in Section 3.2 (Conditions Precedent to Each Loan and Letter of Credit),
and after the Administrative Agent's receipt of such funds, the Administrative
Agent shall make such funds available to the Borrower.
(d) Unless the Administrative Agent shall have received notice from a
Lender prior to the date of any proposed Borrowing that such Lender will not
make available to the Administrative Agent such Lender's Ratable Portion of such
Borrowing (or any portion thereof), the Administrative Agent may assume that
such Lender has made such Ratable Portion available to the Administrative Agent
on the date of such Borrowing in accordance with this Section 2.2 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such
Lender shall not have so made such Ratable Portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay to
the Administrative Agent forthwith on demand such corresponding amount together
with interest thereon, for each day from the date such amount is made available
to the Borrower until the date such amount is repaid to the Administrative
Agent, at (i) in the case of the Borrower, the interest rate applicable at the
time to the Loans comprising such Borrowing and (ii) in the case of such Lender,
the Federal Funds Rate for the first Business Day and thereafter at the interest
rate applicable at the time to the Loans comprising such Borrowing. If such
Lender shall repay to the Administrative Agent such corresponding amount, such
corresponding amount so repaid shall constitute such Lender's Loan as part of
such Borrowing for purposes of this Agreement. If the Borrower shall repay to
the Administrative Agent such corresponding amount, such payment shall not
relieve such Lender of any obligation it may have hereunder to the Borrower.
(e) The failure of any Lender to make the Loan or any payment required
by it on the date specified (a "Non-Funding Lender"), including any payment in
respect of its participation in Letter of Credit Obligations, shall not relieve
any other Lender of its obligations to make such Loan or payment on such date
but no such other Lender shall be responsible for the failure of any Non-Funding
Lender to make a Loan or payment required under this Agreement.
Section 2.3 Letters of Credit
(a) On the terms and subject to the conditions contained in this
Agreement, each Issuer agrees to Issue at the request of the Borrower and for
the account of the Borrower one or more Letters of Credit from time to time on
any Business Day during the period commencing on the Closing Date and ending on
the earlier of the Revolving Credit Termination Date and 30
37
days prior to the Scheduled Termination Date; provided, however, that no Issuer
shall be under any obligation to Issue any Letter of Credit upon the occurrence
of any of the following:
(i) any order, judgment or decree of any Governmental Authority
or arbitrator shall purport by its terms to enjoin or restrain such Issuer
from Issuing such Letter of Credit or any Requirement of Law applicable to
such Issuer or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over such Issuer
shall prohibit, or request that such Issuer refrain from, the Issuance of
letters of credit generally or such Letter of Credit in particular or shall
impose upon such Issuer with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such Issuer is not
otherwise compensated) not in effect on the date of this Agreement or
result in any unreimbursed loss, cost or expense that was not applicable,
in effect or known to such Issuer as of the date of this Agreement and that
such Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(ii) such Issuer shall have received any written notice of the
type described in clause (e) below;
(iii) after giving effect to the Issuance of such Letter of
Credit, the aggregate Revolving Credit Outstandings would exceed the
aggregate of the Revolving Credit Commitments in effect at such time;
(iv) after giving effect to the Issuance of such Letter of
Credit, the sum of (i) the Letter of Credit Undrawn Amounts at such time
and (ii) the Reimbursement Obligations at such time exceeds the Letter of
Credit Sublimit;
(v) after giving effect to the Issuance of such Letter of Credit,
the sum of (i) the Letter of Credit Undrawn Amounts at such time with
respect to all Letters of Credit issued by such Issuer and (ii) the
Reimbursement Obligations with respect to all Letters of Credit issued by
such Issuer at such time exceeds the Letter of Credit Sublimit committed to
by such Issuer;
(vi) any fees due in connection with a requested Issuance have
not been paid;
(vii) such Letter of Credit is requested to be Issued in a form
that is not acceptable to such Issuer; or
(viii) such Letter of Credit is requested to be denominated in
any currency other than Dollars.
None of the Revolving Credit Lenders (other than the Issuers in their capacity
as such) shall have any obligation to Issue any Letter of Credit.
(b) In no event shall the expiration date of any Letter of Credit (i)
be more than one year after the date of issuance thereof or (ii) be less than 5
days prior to the Scheduled Termination Date; provided, however, that any Letter
of Credit with a one-year term may provide for the renewal thereof for
additional one-year periods (which shall in no event extend beyond the expiry
date referred to in clause (ii) above).
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(c) At any time after (i) a letter of credit (whether or not issued
under this Agreement) has been posted to support an appeal bond in respect of
the ▇▇▇▇▇▇ Case or (ii) the ▇▇▇▇▇▇ case has been finally settled or dismissed or
the ▇▇▇▇▇▇ Parties have otherwise satisfied substantially all of their
obligations in respect of the ▇▇▇▇▇▇ Case, no Issuer shall issue a Standby
Letter of Credit under this Section 2.3 unless the Borrower has provided a
written notice to the Agents and such Issuer confirming that the aggregate
amount of the Restricted Cash then on hand is zero (or will be zero after giving
effect to the issuance of any letter of credit issued under Section 8.1(m)
(Indebtedness) concurrently with the issuance of such Standby Letter of Credit
and the transfer of all unused Letter of Credit Support to an account in respect
of which the Administrative Agent has a perfected security interest which
transfer is required to be made in order to maintain compliance with Section
8.2(f) (Liens, Etc.)).
(d) In connection with the Issuance of each Letter of Credit, the
Borrower shall give the relevant Issuer and the Administrative Agent at least
two Business Days' prior written notice, in substantially the form of Exhibit D
(Form of Letter of Credit Request) (or in such other written or electronic form
as is acceptable to the Issuer), of the requested Issuance of such Letter of
Credit (a "Letter of Credit Request"). Such notice shall be irrevocable and
shall specify the Issuer of such Letter of Credit, and face amount of the Letter
of Credit requested, the date of Issuance of such requested Letter of Credit,
the date on which such Letter of Credit is to expire (which date shall be a
Business Day) and, in the case of an issuance, the Person for whose benefit the
requested Letter of Credit is to be issued. Such notice, to be effective, must
be received by the relevant Issuer and the Administrative Agent not later than
11:00 a.m. (New York time) on the second Business Day prior to the requested
Issuance of such Letter of Credit.
(e) Subject to the satisfaction of the conditions set forth in this
Section 2.3, the relevant Issuer shall, on the requested date, Issue a Letter of
Credit on behalf of the Borrower in accordance with such Issuer's usual and
customary business practices. No Issuer shall Issue any Letter of Credit in the
period commencing on the first Business Day after it receives written notice
from the Agent or the Requisite Lenders that one or more of the conditions
precedent contained in Section 3.2 (Conditions Precedent to Each Loan and Letter
of Credit) shall not on such date be satisfied or duly waived and ending when
such conditions are satisfied or duly waived. The relevant Issuer shall not
otherwise be required to determine that, or take notice whether, the conditions
precedent set forth in Section 3.2 (Conditions Precedent to Each Loan and Letter
of Credit) have been satisfied in connection with the Issuance of any Letter of
Credit.
(f) If requested by the relevant Issuer, prior to the issuance of each
Letter of Credit by such Issuer, and as a condition of such Issuance and of the
participation of each Revolving Credit Lender in the Letter of Credit
Obligations arising with respect thereto, the Borrower shall have delivered to
such Issuer a letter of credit reimbursement agreement, in such form as the
Issuer may employ in its ordinary course of business for its own account (a
"Letter of Credit Reimbursement Agreement"), signed by the Borrower, and such
other documents or items as may be required pursuant to the terms thereof. In
the event of any conflict between the terms of any Letter of Credit
Reimbursement Agreement and this Agreement, the terms of this Agreement shall
govern.
(g) Each Issuer shall comply with the following:
(i) give the Administrative Agent written notice (or telephonic
notice confirmed promptly thereafter in writing, which writing may be a
telecopy or electronic mail, of the Issuance or renewal of a Letter of
Credit issued by it, of all
39
drawings under a Letter of Credit issued by it and the payment (or the
failure to pay when due) by the Borrower of any Reimbursement Obligation
when due (which notice the Administrative Agent shall promptly transmit by
telecopy, electronic mail or similar transmission to each Revolving Credit
Lender);
(ii) upon the request of any Revolving Credit Lender, furnish to
such Revolving Credit Lender copies of any Letter of Credit Reimbursement
Agreement to which such Issuer is a party and such other documentation as
may reasonably be requested by such Revolving Credit Lender; and
(iii) no later than 10 Business Days following the last day of
each calendar month, provide to the Administrative Agent (and the
Administrative Agent shall provide a copy to each Revolving Credit Lender
requesting the same) and the Borrower separate schedules for Documentary
Letters of Credit and Standby Letters of Credit issued by it, in form and
substance reasonably satisfactory to the Administrative Agent, setting
forth the aggregate Letter of Credit Obligations outstanding at the end of
each month and any information requested by the Borrower or the
Administrative Agent relating thereto.
(h) Immediately upon the issuance by an Issuer of a Letter of Credit
in accordance with the terms and conditions of this Agreement, such Issuer shall
be deemed to have sold and transferred to each Revolving Credit Lender, and each
Revolving Credit Lender shall be deemed irrevocably and unconditionally to have
purchased and received from such Issuer, without recourse or warranty, an
undivided interest and participation, to the extent of such Revolving Credit
Lender's Ratable Portion of the Revolving Credit Commitments, in such Letter of
Credit and the obligations of the Borrower with respect thereto (including all
Letter of Credit Obligations with respect thereto) and any security therefor and
guaranty pertaining thereto.
(i) The Borrower agrees to pay to the Issuer of any Letter of Credit
the amount of all Reimbursement Obligations owing to such Issuer under any
Letter of Credit issued for its account no later than the date that is the next
succeeding Business Day after the Borrower receives written notice from such
Issuer that payment has been made under such Letter of Credit (the
"Reimbursement Date"), irrespective of any claim, set-off, defense or other
right that the Borrower may have at any time against such Issuer or any other
Person. In the event that any Issuer makes any payment under any Letter of
Credit and the Borrower shall not have repaid such amount to such Issuer
pursuant to this clause (i) or any such payment by the Borrower is rescinded or
set aside for any reason, such Reimbursement Obligation shall be payable on
demand with interest thereon computed (i) from the date on which such
Reimbursement Obligation arose to the Reimbursement Date, at the rate of
interest applicable during such period to Revolving Loans that are Base Rate
Loans and (ii) from the Reimbursement Date until the date of repayment in full,
at the rate of interest applicable during such period to past due Revolving
Loans that are Base Rate Loans, and such Issuer shall promptly notify the
Administrative Agent, which shall promptly notify each Revolving Credit Lender
of such failure, and each Revolving Credit Lender shall promptly and
unconditionally pay to the Administrative Agent for the account of such Issuer
the amount of such Revolving Credit Lender's Ratable Portion of such payment in
Dollars and in immediately available funds. If the Administrative Agent so
notifies such Revolving Credit Lender prior to 11:00 a.m. (New York time) on any
Business Day, such Revolving Credit Lender shall make available to the
Administrative Agent for the account of such Issuer its Ratable Portion of the
amount of such payment on such Business Day in immediately available funds. Upon
such payment by a Revolving Credit Lender, such Revolving Credit
40
Lender shall, except during the continuance of a Default or Event of Default
under Section 9.1(g) (Events of Default) and notwithstanding whether or not the
conditions precedent set forth in Section 3.2 (Conditions Precedent to Each Loan
and Letter of Credit) shall have been satisfied (which conditions precedent the
Revolving Credit Lenders hereby irrevocably waive), be deemed to have made a
Revolving Loan to the Borrower in the principal amount of such payment. Whenever
any Issuer receives from the Borrower a payment of a Reimbursement Obligation as
to which the Administrative Agent has received for the account of such Issuer
any payment from a Revolving Credit Lender pursuant to this clause (i), such
Issuer shall pay to the Administrative Agent and the Administrative Agent shall
promptly pay to each Revolving Credit Lender, in immediately available funds, an
amount equal to such Revolving Credit Lender's Ratable Portion of the amount of
such payment adjusted, if necessary, to reflect the respective amounts the
Revolving Credit Lenders have paid in respect of such Reimbursement Obligation.
(j) If and to the extent such Revolving Credit Lender shall not have
so made its Ratable Portion of the amount of the payment required by clause (i)
above available to the Administrative Agent for the account of such Issuer, such
Revolving Credit Lender agrees to pay to the Administrative Agent for the
account of such Issuer forthwith on demand any such unpaid amount together with
interest thereon, for the first Business Day after payment was first due at the
Federal Funds Rate and, thereafter until such amount is repaid to the
Administrative Agent for the account of such Issuer, at the rate per annum
applicable to Base Rate Loans under the Facility.
(k) The Borrower's obligation to pay each Reimbursement Obligation and
the obligations of the Revolving Credit Lenders to make payments to the
Administrative Agent for the account of the Issuers with respect to Letters of
Credit shall be absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Agreement, under any and all
circumstances whatsoever, including the occurrence of any Default or Event of
Default, and irrespective of any of the following:
(i) any lack of validity or enforceability of any Letter of
Credit or any Loan Document, or any term or provision therein;
(ii) any amendment or waiver of or any consent to departure from
all or any of the provisions of any Letter of Credit or any Loan Document;
(iii) the existence of any claim, set off, defense or other right
that the Borrower, any other party guaranteeing, or otherwise obligated
with, the Borrower, any Subsidiary or other Affiliate thereof or any other
Person may at any time have against the beneficiary under any Letter of
Credit, any Issuer, the Administrative Agent or any Lender or any other
Person, whether in connection with this Agreement, any other Loan Document
or any other related or unrelated agreement or transaction;
(iv) any draft or other document presented under a 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;
(v) payment by the Issuer under a Letter of Credit against
presentation of a draft or other document that does not comply with the
terms of such Letter of Credit; and
41
(vi) any other act or omission to act or delay of any kind of the
Issuer, the Lenders, the Administrative Agent or any other Person or any
other event or circumstance whatsoever, whether or not similar to any of
the foregoing, that might, but for the provisions of this Section 2.3,
constitute a legal or equitable discharge of the Borrower's obligations
hereunder.
Any action taken or omitted to be taken by the relevant Issuer under or in
connection with any Letter of Credit, if taken or omitted in the absence of
gross negligence or willful misconduct, shall not put such Issuer under any
resulting liability to the Borrower or any Lender. In determining whether drafts
and other documents presented under a Letter of Credit comply with the terms
thereof, the Issuer may accept documents that appear on their face to be in
order, without responsibility for further investigation, regardless of any
notice or information to the contrary and, in making any payment under any
Letter of Credit, the Issuer may rely exclusively on the documents presented to
it under such Letter of Credit as to any and all matters set forth therein,
including reliance on the amount of any draft presented under such Letter of
Credit, whether or not the amount due to the beneficiary thereunder equals the
amount of such draft and whether or not any document presented pursuant to such
Letter of Credit proves to be insufficient in any respect, if such document on
its face appears to be in order, and whether or not any other statement or any
other document presented pursuant to such Letter of Credit proves to be forged
or invalid or any statement therein proves to be inaccurate or untrue in any
respect whatsoever and any noncompliance in any immaterial respect of the
documents presented under such Letter of Credit with the terms thereof shall, in
each case, be deemed not to constitute willful misconduct or gross negligence of
the Issuer.
Section 2.4 Reduction and Termination of the Revolving Credit
Commitments
(a) The Borrower may, upon at least three Business Days' prior notice
to the Administrative Agent, terminate in whole or reduce in part ratably the
unused portions of the respective Revolving Credit Commitments of the Revolving
Credit Lenders; provided, however, that each partial reduction shall be in an
aggregate amount of not less than $5,000,000 or an integral multiple of
$1,000,000 in excess thereof.
(b) The then current Revolving Credit Commitments shall be reduced on
each date on which a prepayment of Revolving Loans is made pursuant to Section
2.8(a) or (b) (Mandatory Prepayments) or would be required to be made had the
outstanding Revolving Loans equaled the Revolving Credit Commitments then in
effect, in each case in the amount of such prepayment (or deemed prepayment)
(and the Revolving Credit Commitment of each Lender shall be reduced by its
Ratable Portion of such amount).
Section 2.5 Repayment of Loans
(a) The Borrower promises to repay the entire unpaid principal amount
of the Revolving Loans on the Scheduled Termination Date or earlier, if
otherwise required by the terms hereof.
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(b) The Borrower promises to repay the Term Loans at the dates and in
the amounts set forth below:
Date Amount
---- ------
September 30, 2003 and each December 31, March 31, $ 625,000
June 30 and September 30 thereafter until the Term
Loan Maturity Date
Term Loan Maturity Date (if January 1, 2007) $241,875,000
Term Loan Maturity Date (if the 5th anniversary of $238,125,000;
the Closing Date)
provided, however, that the Borrower shall repay the entire unpaid principal
amount of the Term Loans on the Term Loan Maturity Date.
Section 2.6 Evidence of Debt
(a) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing Indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(b) The Administrative Agent shall maintain accounts in accordance
with its usual practice in which it shall record (i) the amount of each Loan
made and, if a Eurodollar Rate Loan, the Interest Period applicable thereto,
(ii) the amount of any principal or interest due and payable by the Borrower to
each Lender hereunder and (iii) the amount of any sum received by the
Administrative Agent hereunder from the Borrower, whether such sum constitutes
principal or interest (and the type of Loan to which it applies), fees, expenses
or other amounts due under the Loan Documents and each Lender's share thereof,
if applicable.
(c) The entries made in the accounts maintained pursuant to clauses
(a) and (b) above shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations recorded therein;
provided, however, that the failure of any Lender or the Administrative Agent to
maintain such accounts or any error therein shall not in any manner affect the
obligations of the Borrower to repay the Loans in accordance with their terms.
(d) Notwithstanding any other provision of the Agreement, in the event
that any Lender requests that the Borrower execute and deliver a promissory note
or notes payable to such Lender in order to evidence the Indebtedness owing to
such Lender by the Borrower hereunder, the Borrower shall promptly execute and
deliver a Note or Notes to such Lender evidencing any Term Loans and Revolving
Loans, as the case may be, of such Lender, substantially in the forms of Exhibit
B-1 (Form of Revolving Credit Note) or Exhibit B-2 (Form of Term Note),
respectively.
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Section 2.7 Optional Prepayments
(a) Revolving Loans. The Borrower may, at any time, upon at least one
Business Days' prior notice to the Administrative Agent, prepay the outstanding
principal amount of the Revolving Loans in whole or in part; provided, however,
that if any prepayment of any Eurodollar Rate Loan is made by the Borrower other
than on the last day of an Interest Period for such Loan, the Borrower shall
also pay any amount owing pursuant to Section 2.13(e) (Breakage Costs); and,
provided, further, that each partial prepayment shall be in an aggregate
principal amount not less than $5,000,000 or integral multiples of $1,000,000 in
excess thereof. Upon the giving of such notice of prepayment, the principal
amount of Revolving Loans specified to be prepaid shall become due and payable
on the date specified for such prepayment.
(b) Term Loans. The Borrower may, upon at least three Business Days'
prior notice to the Administrative Agent or at the end of any applicable
Interest Period (or at any other time with the payment of any amount then owing
pursuant to Section 2.13(e) (Breakage Costs), stating the proposed date and
aggregate principal amount of the prepayment, prepay the outstanding principal
amount of the Term Loans, in whole or in part, together with accrued interest to
the date of such prepayment on the principal amount prepaid; provided, however,
that if any prepayment of any Eurodollar Rate Loan is made by the Borrower other
than on the last day of an Interest Period for such Loan, the Borrower shall
also pay any amounts owing pursuant to Section 2.13(e) (Breakage Costs); and,
provided, further, that each partial prepayment shall be in an aggregate amount
not less than $5,000,000 or integral multiples of $1,000,000 in excess thereof
and that any such partial prepayment shall be applied to reduce ratably the
remaining installments of such outstanding principal amount of the Term Loans.
Upon the giving of such notice of prepayment, the principal amount of the Term
Loans specified to be prepaid shall become due and payable on the date specified
for such prepayment.
(c) The Borrower shall have no right to prepay the principal amount of
any Revolving Loan or any Term Loan other than as provided in this Section 2.7.
Section 2.8 Mandatory Prepayments
(a) Subject to clauses (d) and (e) below, upon receipt by any ▇▇▇▇▇▇
Entity of Net Cash Proceeds arising from an Asset Sale, Property Loss Event,
Debt Issuance, Restricted Cash Release or Equity Issuance, the Borrower shall
immediately prepay the Loans (or, to the extent there are no Loans then
outstanding, provide cash collateral in respect of Letters of Credit) in an
amount equal to 100% of such Net Cash Proceeds. Any such mandatory prepayment
shall be applied in accordance with clause (c) below.
(b) The Borrower shall prepay the Loans (or, to the extent there are
no Loans then outstanding, provide cash collateral in respect of Letters of
Credit) within 105 days after the last day of each Fiscal Year, in an amount
equal to 50% of Holdings' Excess Cash Flow for such Fiscal Year; provided, that
(i) if as of the last day of such Fiscal Year, Holdings' Leverage Ratio is less
than 3.5:1, the foregoing 50% shall be reduced to 20%, and (ii) at any time
Holdings' Leverage Ratio is less than 2:1, the Borrower shall not be required to
make any prepayments under this clause (b). Any such mandatory prepayment shall
be applied in accordance with clause (c) below.
(c) Subject to the provisions of Section 2.12(f) (Payments and
Computations), any prepayments made by the Borrower required to be applied in
accordance with
44
this clause (c) shall be applied as follows: first, to repay the outstanding
principal balance of the Term Loans, until such Term Loans shall have been
prepaid in full; second, to repay the outstanding principal balance of the
Revolving Loans until such Revolving Loans shall have been paid in full; and
then, to provide cash collateral for any Letter of Credit Obligations in the
manner set forth in Section 9.3 (Actions in Respect of Letters of Credit) until
all such Letter of Credit Obligations have been fully cash collateralized in the
manner set forth therein. All repayments of the Term Loans made pursuant to this
clause (c) shall be applied to reduce ratably the remaining installments of such
outstanding principal amounts of the Term Loans. All repayments of Revolving
Loans required to be made pursuant to this clause (c) shall result in a
permanent reduction of the Revolving Credit Commitments to the extent provided
in Section 2.4(b) (Reduction and Termination of the Revolving Credit
Commitments).
(d) Notwithstanding anything in this Section 2.8 to the contrary, the
Reinvestment Deferred Amount arising from a Reinvestment Event shall, at the
election of the Borrower, either (i) be applied to prepay the Revolving Loans
pending reinvestment thereof by the applicable ▇▇▇▇▇▇ Entity (which prepayment
shall not result in a permanent reduction of the Revolving Credit Commitments)
or (ii) be held by the applicable ▇▇▇▇▇▇ Entity; provided, that, in each case:
(A) such ▇▇▇▇▇▇ Entity shall use or commit to use such Reinvestment Deferred
Amount to repair, restore or replace the assets which were the subject of such
Reinvestment Event with assets that are useful in the ▇▇▇▇▇▇ Entities' business
no later than 270 days after receipt thereof, and (B) if, at any time prior to
the applicable Reinvestment Prepayment Date, an Event of Default has occurred
and is continuing, the aggregate amount of such Reinvestment Deferred Amount
shall be applied to repay the Loans as set forth in clause (c) above; provided
further, that, to the extent that any amount of such Reinvestment Deferred
Amount is not used or committed to be used prior to the applicable Reinvestment
Prepayment Date, such Reinvestment Prepayment Amount shall be applied on the
Reinvestment Prepayment Date to repay the Loans as set forth in clause (c)
above. Notwithstanding the foregoing, to the extent any Reinvestment Deferred
Amount that the Borrower elects to reinvest pursuant to this clause (d) arises
from the sale or loss of Collateral, such Reinvestment Deferred Amount shall be
applied to acquire replacement assets constituting Collateral.
(e) Notwithstanding anything else in this Section 2.8, as long as no
Event of Default shall have occurred or be continuing:
(i) the Borrower shall only be required to apply 50% of the Net
Cash Proceeds arising from Asset Sales of all or any portion of Westvaco or
▇▇▇▇▇▇▇ to prepay the Loans (or, to the extent there are no Loans then
outstanding, provide cash collateral in respect of Letters of Credit)
pursuant to this Section 2.8;
(ii) the Borrower shall not be required to apply Net Cash
Proceeds from a Debt Issuance of New Securities to prepay the Loans (or, to
the extent there are no Loans then outstanding, provide cash collateral in
respect of Letters of Credit) pursuant to this Section 2.8 to the extent
the Net Cash Proceeds thereof are applied to permanently repay, redeem,
defease or repurchase the 6.95% Notes (plus any interest owed under the
6.95% Notes and any cash costs associated with the issuance of any New
Securities (including underwriting fees, attorneys' fees, advisors' fees,
investment bank fees and taxes)) in an amount equal to such Net Cash
Proceeds; and
(iii) the Borrower shall not be required to apply Net Cash
Proceeds from an Equity Issuance of common stock of Holdings to prepay the
Loans (or, to the
45
extent there are no Loans then outstanding, provide cash collateral in
respect of Letters of Credit) pursuant to this Section 2.8 to the extent
the Net Cash Proceeds thereof are applied to finance a Permitted
Acquisition by a ▇▇▇▇▇▇ Entity; provided that prior to the consummation of
any such Equity Issuance the Borrower has given notice to the
Administrative Agent that Holdings intends to invest the Net Cash Proceeds
thereof pursuant to this clause (iii) and Holdings does so invest such Net
Cash Proceeds within 45 days after the receipt thereof.
(f) If at any time, the aggregate principal amount of Revolving Credit
Outstandings exceeds the Revolving Credit Commitments at such time, the Borrower
shall forthwith prepay the Revolving Loans then outstanding in an amount equal
to such excess. If any such excess remains after repayment in full of the
aggregate outstanding Revolving Loans, the Borrower shall provide cash
collateral for the Letter of Credit Obligations in the manner set forth in
Section 9.3 (Actions in respect of Letters of Credit) in an amount equal to 105%
of such excess.
Section 2.9 Interest
(a) Rate of Interest. All Loans and the outstanding amount of all
other Obligations (other than pursuant to Hedging Contracts that are Loan
Documents, to the extent such Hedging Contracts provide for the accrual of
interest on unpaid obligations) shall bear interest, in the case of Loans, on
the unpaid principal amount thereof from the date such Loans are made and, in
the case of such other Obligations, from the date such other Obligations are due
and payable until, in all cases, paid in full, except as otherwise provided in
clause (c) below, as follows:
(i) if a Base Rate Loan or such other Obligation, at a rate per
annum equal to the sum of (A) the Base Rate as in effect from time to time
and (B) the Applicable Margin; and
(ii) if a Eurodollar Rate Loan, at a rate per annum equal to the
sum of (A) the Eurodollar Rate determined for the applicable Interest
Period and (B) the Applicable Margin in effect from time to time during
such Eurodollar Interest Period.
(b) Interest Payments. (i) Interest accrued on each Base Rate Loan
shall be payable in arrears (A) on the first Business Day of each calendar
quarter, commencing on the first such day following the making of such Base Rate
Loan, (B) in the case of Base Rate Loans that are Term Loans, upon the payment
or prepayment thereof in full or in part and (C) if not previously paid in full,
at maturity (whether by acceleration or otherwise) of such Base Rate Loan, (ii)
interest accrued on each Eurodollar Rate Loan shall be payable in arrears (A) on
the last day of each Interest Period applicable to such Loan and, if such
Interest Period has a duration of more than three months, on each day during
such Interest Period occurring every three months from the first day of such
Interest Period, (B) upon the payment or prepayment thereof in full or in part
and (C) if not previously paid in full, at maturity (whether by acceleration or
otherwise) of such Eurodollar Rate Loan and (iii) interest accrued on the amount
of all other Obligations shall be payable on demand from and after the time such
Obligation becomes due and payable (whether by acceleration or otherwise).
(c) Default Interest. Notwithstanding the rates of interest specified
in clause (a) above or elsewhere herein, effective immediately upon the
occurrence of an Event of Default and for as long thereafter as such Event of
Default shall be continuing, the principal
46
balance of all Loans and the amount of all other Obligations then due and
payable shall bear interest at a rate that is two percent per annum in excess of
the rate of interest applicable to such Loans or other Obligations from time to
time. Such interest shall be payable on demand.
Section 2.10 Conversion/Continuation Option
(a) The Borrower may elect (i) at any time on any Business Day to
convert Base Rate Loans or any portion thereof to Eurodollar Rate Loans and (ii)
at the end of any applicable Interest Period, to convert Eurodollar Rate Loans
or any portion thereof into Base Rate Loans or to continue such Eurodollar Rate
Loans or any portion thereof for an additional Interest Period; provided,
however, that the aggregate amount of the Eurodollar Loans for each Interest
Period must be in the amount of at least $5,000,000 or an integral multiple of
$1,000,000 in excess thereof. Each conversion or continuation shall be allocated
among the Loans of each Lender in accordance with such Lender's Ratable Portion.
Each such election shall be in substantially the form of Exhibit E (Form of
Notice of Conversion or Continuation) (a "Notice of Conversion or Continuation")
and shall be made by giving the Administrative Agent at least three Business
Days' prior written notice specifying (A) the amount and type of Loan being
converted or continued, (B) in the case of a conversion to or a continuation of
Eurodollar Rate Loans, the applicable Interest Period and (C) in the case of a
conversion, the date of conversion.
(b) The Administrative Agent shall promptly notify each Lender of its
receipt of a Notice of Conversion or Continuation and of the options selected
therein. Notwithstanding the foregoing, no conversion in whole or in part of
Base Rate Loans to Eurodollar Rate Loans, and no continuation in whole or in
part of Eurodollar Rate Loans upon the expiration of any applicable Interest
Period, shall be permitted at any time at which (i) a Default or an Event of
Default shall have occurred and be continuing or (ii) the continuation of, or
conversion into, a Eurodollar Rate Loan would violate any provision of Section
2.13 (Special Provisions Governing Eurodollar Rate Loans). If, within the time
period required under the terms of this Section 2.10, the Administrative Agent
does not receive a Notice of Conversion or Continuation from the Borrower
containing a permitted election to continue any Eurodollar Rate Loans for an
additional Interest Period or to convert any such Loans, then, upon the
expiration of the applicable Interest Period, such Loans shall be automatically
converted to Base Rate Loans. Each Notice of Conversion or Continuation shall be
irrevocable.
Section 2.11 Fees
(a) Unused Commitment Fee. The Borrower agrees to pay to each
Revolving Credit Lender a commitment fee on the actual daily amount by which the
Revolving Credit Commitment of such Lender exceeds such Lender's Ratable Portion
of the sum of (i) the outstanding principal amount of Revolving Loans and (ii)
the outstanding amount of the Letter of Credit Obligations (the "Unused
Commitment Fee") from the date hereof through the Revolving Credit Termination
Date at the Applicable Unused Commitment Fee Rate, payable in arrears (x) on the
first Business Day of each calendar quarter, commencing on the first such
Business Day following the Closing Date and (y) on the Revolving Credit
Termination Date.
(b) Letter of Credit Fees. The Borrower agrees to pay the following
amounts with respect to Letters of Credit issued by any Issuer:
(i) to the Administrative Agent for the account of each Issuer of
a Letter of Credit, with respect to each Letter of Credit issued by such
Issuer, an issuance
47
fee in an amount agreed by such Issuer and the Borrower (but in any event
not greater than 0.25% per annum of the maximum undrawn face amount of such
Letter of Credit), payable in arrears (A) on the first Business Day of each
calendar quarter, commencing on the first such Business Day following the
issuance of such Letter of Credit and (B) on the Revolving Credit
Termination Date;
(ii) to the Administrative Agent for the ratable benefit of the
Revolving Credit Lenders, with respect to each Letter of Credit, a fee
accruing at a rate per annum equal to the Applicable Margin for Revolving
Loans that are Eurodollar Rate Loans on the maximum undrawn face amount of
such Letter of Credit, payable in arrears (A) on the first Business Day of
each calendar quarter, commencing on the first such Business Day following
the issuance of such Letter of Credit and (B) on the Revolving Credit
Termination Date; provided, however, that during the continuance of an
Event of Default, such fee shall be increased by two percent per annum and
shall be payable on demand; and
(iii) to the Issuer of any Letter of Credit, with respect to the
issuance, amendment or transfer of each Letter of Credit and each drawing
made thereunder, documentary and processing charges in accordance with such
Issuer's standard schedule for such charges in effect at the time of
issuance, amendment, transfer or drawing, as the case may be.
(c) Additional Fees. The Borrower has agreed to pay to the
Administrative Agent and the Arranger additional fees, the amount and dates of
payment of which are embodied in the Fee Letter.
Section 2.12 Payments and Computations
(a) The Borrower shall make each payment hereunder (including fees and
expenses) not later than 11:00 a.m. (New York time) on the day when due, in
Dollars, to the Administrative Agent at its address referred to in Section 11.8
(Notices Etc.) in immediately available funds without set-off or counterclaim.
The Administrative Agent shall promptly thereafter cause to be distributed
immediately available funds relating to the payment of principal, interest or
fees to the Lenders, in accordance with the application of payments set forth in
Section 2.8(c) (Mandatory Prepayments) and in clauses (e) or (f) below, as
applicable, for the account of their respective Applicable Lending Offices;
provided, however, that amounts payable pursuant to Section 2.14 (Capital
Adequacy), Section 2.15 (Taxes) or Section 2.13(c) (Increased Costs) or (d)
(Illegality) shall be paid only to the affected Lender or Lenders. Payments
received by the Administrative Agent after 11:00 a.m. (New York time) shall be
deemed to be received on the next Business Day.
(b) All computations of interest on Base Rate Loans calculated based
on clause (i) of the definition of Alternate Base Rate shall be made by the
Administrative Agent on the basis of a year of 365 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest and fees are payable. All other
computations of interest and of fees shall be made by the Administrative Agent
on the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest and fees are payable. Each determination by the
Administrative Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
48
(c) Whenever any payment hereunder shall be stated to be due on a day
other than a Business Day, the due date for such payment shall be extended to
the next succeeding Business Day, and such extension of time shall in such case
be included in the computation of payment of interest or fees, as the case may
be; provided, however, that if such extension would cause payment of interest on
or principal of any Eurodollar Rate Loan to be made in the next calendar month,
such payment shall be made on the immediately preceding Business Day. All
repayments of any Revolving Loans or Term Loans shall be applied as follows:
first, to repay such Loans outstanding as Base Rate Loans and then, to repay
such Loans outstanding as Eurodollar Rate Loans, with those Eurodollar Rate
Loans having earlier expiring Eurodollar Interest Periods being repaid prior to
those having later expiring Eurodollar Interest Periods.
(d) Unless the Administrative Agent shall have received notice from
the Borrower to the Lenders prior to the date on which any payment is due
hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such
due date an amount equal to the amount then due such Lender. If and to the
extent that the Borrower shall not have made such payment in full to the
Administrative Agent, each Lender shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Lender together with
interest thereon at the Federal Funds Rate, for the first Business Day, and,
thereafter, at the rate applicable to Base Rate Loans, for each day from the
date such amount is distributed to such Lender until the date such Lender repays
such amount to the Administrative Agent.
(e) Except for payments and other amounts received by the
Administrative Agent and applied in accordance with the provisions of clause (f)
below (or required to be applied in accordance with Section 2.8 (Mandatory
Prepayments)), all payments and any other amounts received by the Administrative
Agent from or for the benefit of the Borrower shall be applied as follows:
first, to pay principal of, and interest on, any portion of the Loans the
Administrative Agent may have advanced pursuant to the express provisions of
this Agreement on behalf of any Lender, for which the Administrative Agent has
not then been reimbursed by such Lender or the Borrower, second, to pay all
other Obligations then due and payable and third, as the Borrower so designates.
Payments in respect of Revolving Loans received by the Administrative Agent
shall be distributed to each Revolving Credit Lender in accordance with such
Lender's Ratable Portion of the Revolving Credit Commitments; payments in
respect of the Term Loans received by the Administrative Agent shall be
distributed to each Term Loan Lender in accordance with such Lender's Ratable
Portion of the Term Loans; and all payments of fees and all other payments in
respect of any other Obligation shall be allocated among such of the Lenders and
Issuers as are entitled thereto and, for such payments allocated to the Lenders,
in proportion to their respective Ratable Portions.
(f) The Borrower hereby irrevocably waives the right to direct the
application of any and all payments in respect of the Obligations and any
proceeds of Collateral after the occurrence and during the continuance of an
Event of Default and agrees that, notwithstanding the provisions of Section 2.8
(Mandatory Prepayments) and clause (e) above, the Administrative Agent may, and,
upon either (A) the written direction of the Agents or the Requisite Lenders or
(B) the acceleration of the Obligations pursuant to Section 9.2 (Remedies),
shall, deliver a Blockage Notice to each Deposit Account Bank and apply all
payments in respect
49
of any Obligations and all funds on deposit in any Cash Collateral Account
(including all proceeds arising from a Reinvestment Event that are held in the
Cash Collateral Account pending application of such proceeds as specified in a
Reinvestment Notice) and all other proceeds of Collateral in the following
order:
First, to pay interest on and then principal of any portion of
the Revolving Loans that the Administrative Agent may have advanced on
behalf of any Lender for which the Administrative Agent has not then been
reimbursed by such Lender or the Borrower;
Second, to pay Obligations in respect of any expense
reimbursements or indemnities and Cash Management Obligations then due to
the Administrative Agent;
Third, to pay Obligations in respect of any expense
reimbursements or indemnities then due to the Lenders and the Issuers;
Fourth, to pay Obligations in respect of any fees then due to the
Administrative Agent, the Lenders and the Issuers;
Fifth, to pay interest then due and payable in respect of the
Loans and Reimbursement Obligations;
Sixth, to pay or prepay principal amounts on the Loans and
Reimbursement Obligations and to provide cash collateral for outstanding
Letter of Credit Undrawn Amounts in the manner described in Section 9.3
(Actions in Respect of Letters of Credit), ratably to the aggregate
principal amount of such Loans, Reimbursement Obligations and Letter of
Credit Undrawn Amounts, and Obligations owing with respect to Hedging
Contracts;
Seventh, to the ratable payment of all other Obligations; and
Eighth, any excess to the Borrower;
provided, however, that if sufficient funds are not available to fund all
payments to be made in respect of any Obligation described in any of clauses
first, second, third, fourth, fifth, sixth and seventh above, the available
funds being applied with respect to any such Obligation (unless otherwise
specified in such clause) shall be allocated to the payment of such Obligations
ratably, based on the proportion of the Administrative Agent's and each Lender's
or Issuer's interest in the aggregate outstanding Obligations described in such
clauses. The order of priority set forth in clauses first, second, third,
fourth, fifth, sixth and seventh above may at any time and from time to time be
changed by the agreement of the Requisite Lenders without necessity of notice to
or consent of or approval by the Borrower, any Secured Party that is not a
Lender or Issuer or by any other Person that is not a Lender or Issuer. The
order of priority set forth in clauses first, second, and fourth above may be
changed only with the prior written consent of the Administrative Agent in
addition to that of the Requisite Lenders.
(g) At the option of the Administrative Agent, principal on the
Reimbursement Obligations, interest, fees, expenses and other sums due and
payable in respect of the Revolving Loans and Protective Advances may be paid
from the proceeds of Revolving Loans. The Borrower hereby authorizes the
Revolving Credit Lenders to make Revolving Loans
50
pursuant to Section 2.2(a) (Borrowing Procedures) from time to time in such
Revolving Credit Lender's discretion, that are in the amounts of any and all
interest, fees, expenses and other sums payable in respect of the Revolving
Loans and Protective Advances, and further authorizes the Administrative Agent
to give the Revolving Credit Lenders notice of any Borrowing with respect to
such Revolving Loans and to distribute the proceeds of such Revolving Loans to
pay such amounts. The Borrower agrees that all such Revolving Loans so made
shall be deemed to have been requested by it (irrespective of the satisfaction
of the conditions in Section 3.2 (Conditions Precedent to Each Loan and Letter
of Credit), which conditions the Revolving Credit Lenders irrevocably waive) and
directs that all proceeds thereof shall be used to pay such amounts.
Section 2.13 Special Provisions Governing Eurodollar Rate Loans
(a) Determination of Interest Rate
The Eurodollar Rate for each Interest Period for Eurodollar Rate Loans
shall be determined by the Administrative Agent pursuant to the procedures set
forth in the definition of "Eurodollar Rate." The Administrative Agent's
determination shall be presumed to be correct absent manifest error and shall be
binding on the Borrower.
(b) Interest Rate Unascertainable, Inadequate or Unfair
In the event that (i) the Administrative Agent determines that
adequate and fair means do not exist for ascertaining the applicable interest
rates by reference to which the Eurodollar Rate then being determined is to be
fixed or (ii) any Lender notifies the Administrative Agent that the Eurodollar
Rate for any Interest Period will not adequately reflect the cost to such Lender
of making or maintaining such Loans for such Interest Period, the Administrative
Agent shall forthwith so notify the Borrower and the Lenders, whereupon each
Eurodollar Loan shall automatically, on the last day of the current Interest
Period for such Loan, convert into a Base Rate Loan and the obligations of the
Lenders to make Eurodollar Rate Loans or to convert Base Rate Loans into
Eurodollar Rate Loans shall be suspended until the Administrative Agent shall
notify the Borrower that the Lenders have determined that the circumstances
causing such suspension no longer exist.
(c) Increased Costs
If at any time any Lender determines that the introduction of, or any
change in or in the interpretation of, any law, treaty or governmental rule,
regulation or order (other than any change by way of imposition or increase of
reserve requirements included in determining the Eurodollar Rate) or the
compliance by such Lender with any guideline, request or directive from any
central bank or other Governmental Authority (whether or not having the force of
law), in each case after the date of this Agreement, shall have the effect of
increasing the cost (other than any taxes) to such Lender of agreeing to make or
making, funding or maintaining any Eurodollar Rate Loans then the Borrower shall
from time to time, upon demand by such Lender (with a copy of such demand to the
Administrative Agent), pay to the Administrative Agent for the account of such
Lender additional amounts sufficient to compensate such Lender for such
increased cost provided, that before making any such demand, each Lender agrees
to use reasonable efforts (consistent with its internal policy and legal and
regulatory restrictions and so long as such efforts would not be disadvantageous
to it, in its reasonable discretion, in any legal, economic or regulatory
manner) to designate a different Eurodollar Lending Office if the making of such
designation would allow the Lender or its Eurodollar Lending Office to continue
to perform its
51
obligations to make Eurodollar Rate Loans or to continue to fund or maintain
Eurodollar Rate Loans and avoid the need for, or reduce the amount of, such
increased cost. A certificate in reasonable detail as to the amount of such
increased cost, submitted to the Borrower and the Administrative Agent by such
Lender, shall be conclusive and binding for all purposes, absent manifest error.
(d) Illegality
Notwithstanding any other provision of this Agreement, if any Lender
determines that the introduction of, or any change in or in the interpretation
of, any law, treaty or governmental rule, regulation or order after the date of
this Agreement shall make it unlawful, or any central bank or other Governmental
Authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to make Eurodollar Rate Loans or to continue to fund or maintain
Eurodollar Rate Loans, then, on notice thereof and demand therefor by such
Lender to the Borrower through the Administrative Agent, (i) the obligation of
such Lender to make or to continue Eurodollar Rate Loans and to convert Base
Rate Loans into Eurodollar Rate Loans shall be suspended, and each such Lender
shall make a Base Rate Loan as part of any requested Borrowing of Eurodollar
Rate Loans and (ii) if the affected Eurodollar Rate Loans are then outstanding,
the Borrower shall immediately convert each such Loan into a Base Rate Loan. If,
at any time after a Lender gives notice under this Section 2.13(d), such Lender
determines that it may lawfully make Eurodollar Rate Loans, such Lender shall
promptly give notice of that determination to the Borrower and the
Administrative Agent, and the Administrative Agent shall promptly transmit the
notice to each other Lender. The Borrower's right to request, and such Lender's
obligation, if any, to make Eurodollar Rate Loans shall thereupon be restored.
(e) Breakage Costs
In addition to all amounts required to be paid by the Borrower
pursuant to Section 2.9 (Interest), the Borrower shall compensate each Lender,
upon demand, for all losses, expenses and liabilities (including any loss or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by such Lender to fund or maintain such Lender's Eurodollar
Rate Loans to the Borrower but excluding any lost profits or loss of the
Applicable Margin on the relevant Loans) that such Lender may sustain (i) if for
any reason a proposed Borrowing, conversion into or continuation of Eurodollar
Rate Loans does not occur on a date specified therefor in a Notice of Borrowing
or a Notice of Conversion or Continuation given by the Borrower or in a
telephonic request by it for borrowing or conversion or continuation or a
successive Interest Period does not commence after notice therefor is given
pursuant to Section 2.10 (Conversion/Continuation Option), (ii) if for any
reason any Eurodollar Rate Loan is prepaid (excluding, however, mandatory
prepayments pursuant to Section 2.8 (Mandatory Prepayments)) on a date that is
not the last day of the applicable Interest Period, (iii) as a consequence of a
required conversion of a Eurodollar Rate Loan to a Base Rate Loan as a result of
any of the events indicated in clause (d) above or (iv) as a consequence of any
failure by the Borrower to repay Eurodollar Rate Loans when required by the
terms hereof. The Lender making demand for such compensation shall deliver to
the Borrower concurrently with such demand a written statement in reasonable
detail as to such losses, expenses and liabilities, and this statement shall be
conclusive as to the amount of compensation due to such Lender, absent manifest
error.
52
Section 2.14 Capital Adequacy
If at any time any Lender determines that (a) the adoption of, or any
change in or in the interpretation of, any law, treaty or governmental rule,
regulation or order after the date of this Agreement regarding capital adequacy,
(b) compliance with any such law, treaty, rule, regulation or order or (c)
compliance with any guideline or request or directive from any central bank or
other Governmental Authority (whether or not having the force of law) issued
after the date of this Agreement shall have the effect of reducing the rate of
return on such Lender's (or any corporation controlling such Lender's) capital
as a consequence of its obligations hereunder or under or in respect of any
Letter of Credit to a level below that which such Lender or such corporation
could have achieved but for such adoption, change, compliance or interpretation,
then, upon demand from time to time by such Lender (with a copy of such demand
to the Administrative Agent), the Borrower shall pay to the Administrative Agent
for the account of such Lender, from time to time as specified by such Lender,
additional amounts sufficient to compensate such Lender for such reduction. A
certificate in reasonable detail as to such amounts submitted to the Borrower
and the Administrative Agent by such Lender shall be conclusive and binding for
all purposes absent manifest error.
Section 2.15 Taxes
(a) Any and all payments by any Loan Party under each Loan Document
shall be made free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto imposed by the United States of America or any
political subdivision or taxing authority thereof or therein, excluding, in the
case of each Lender, Issuer and the Administrative Agent, taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto: (A) that are measured by or imposed upon its gross or net income, and
any franchise taxes imposed on it, by the jurisdiction (or any political
subdivision thereof) under the laws of which such Lender, Issuer or the
Administrative Agent (as the case may be) is organized or in which its principal
office or Applicable Lending Office are located (or any political subdivision
thereof), (B) that are imposed upon or measured by its income (including branch
profits taxes) by the United States of America or any political subdivision or
taxing authority thereof or therein (including, without limitation, any state in
the United States and any political subdivision of any such state), (C) that are
payable with respect to payments under the Loan Documents (including United
States withholding taxes) under laws (including any statute, treaty or
regulation) in effect on the Closing Date (or, in the case of an Eligible
Assignee, the date of the Assignment and Acceptance) applicable to such Lender,
Issuer or the Administrative Agent, as the case may be, but not excluding any
United States withholding taxes payable solely as a result of any change in such
laws occurring after the Closing Date (or the date of such Assignment and
Acceptance) and (D) that are imposed on it as a result of a trade or business, a
permanent establishment, or a present or former connection between such Lender,
Issuer or Administrative Agent (as the case may be) and the jurisdiction of the
Governmental Authority imposing such tax or any taxing authority thereof or
therein (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities, excluding, with respect to each Lender, Issuer and
the Administrative Agent, liabilities attributable to the gross negligence or
willful misconduct of such Lender, Issuer or Administrative Agent, being
hereinafter referred to as "Taxes"). If any Taxes shall be required by law to be
deducted from or in respect of any sum payable under any Loan Document to any
Lender, any Issuer or the Administrative Agent (w) the sum payable shall be
increased as may be necessary so that, after making all required deductions on
account of Taxes (including deductions
53
on account of Taxes applicable to additional sums payable under this Section
2.15, such Lender, Issuer or the Administrative Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (x) the relevant Loan Party shall make such deductions,
(y) the relevant Loan Party shall pay the full amount deducted to the relevant
taxing authority or other authority in accordance with applicable law.
(b) In addition, each Loan Party agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies of the United States or any political subdivision thereof, and
all liabilities with respect thereto, in each case arising from the execution,
delivery or registration of, or otherwise similarly with respect to, any Loan
Document (collectively, "Other Taxes").
(c) Without duplication of its obligation to make additional payments
on account of Taxes pursuant to clause (a) above each Loan Party shall, jointly
and severally, indemnify each Lender, Issuer and the Administrative Agent for
the full amount of Taxes with respect to payments by any Loan Party under any
Loan Document and Other Taxes (including any Taxes and Other Taxes imposed by
any jurisdiction on amounts payable under this Section 2.15 paid by such Lender,
Issuer or the Administrative Agent (as the case may be) and any liability
(including for penalties, interest and expenses) arising therefrom or with
respect thereto (except, with respect to each Lender, Issuer and the
Administrative Agent to the extent arising from the gross negligence or willful
misconduct of such Lender, Issuer or the Administrative Agent, including the
failure of such Lender, Issuer or the Administrative Agent to make any filing or
payment within such person's control, but only if such failure is the result of
gross negligence or willful misconduct), whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be made
within 30 days from the date such Lender, Issuer or the Administrative Agent (as
the case may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes by any Loan Party to a Governmental Authority, the Borrower shall furnish
to the Administrative Agent, at its address referred to in Section 11.8
(Notices, Etc.), the original or a certified copy of a receipt evidencing
payment thereof or, if no such receipt is available, other documentation
evidencing such payment.
(e) Without prejudice to the survival of any other agreement of any
Loan Party hereunder or under the Guaranty, the agreements and obligations of
such Loan Party contained in this Section 2.15 shall survive the payment in full
of the Obligations.
(f) Prior to the Closing Date in the case of each Lender or Issuer
that is a signatory hereto, and on the date of the Assignment and Acceptance
pursuant to which it becomes a Lender or Issuer in the case of each other Lender
or Issuer and from time to time thereafter if requested by the Borrower or the
Administrative Agent (but, in any event, once every three years), each Lender or
Issuer shall provide the Administrative Agent and the Borrower with two
completed originals of each of the following: (i) Form W-8ECI (in the case of a
Non-U.S. Lender claiming exemption from withholding because the income is
effectively connected with a U.S. trade or business) or any successor form, (ii)
Form W-8BEN (in the case of a Non-U.S. Lender claiming exemption from, or a
reduction of, withholding tax under an income tax treaty) or any successor form,
(iii) in the case of a Non-U.S. Lender claiming exemption under Sections 871(h)
or 881(c) of the Code, a Form W-8BEN (claiming exemption from withholding under
the portfolio interest exemption) or with respect to any Loan Documents in which
a participation has been sold, a Form W-8IMY along with accompanying Forms
W-8BEN
54
(claiming exemption from withholding under the portfolio interest exemption) or
any successor forms, (iv) any other applicable form, certificate or document
prescribed by the IRS certifying as to such Non-U.S. Lender's entitlement to
such exemption from United States withholding tax or reduced rate with respect
to all payments to be made to such Non-U.S. Lender under the Loan Documents, or
(v) in the case of any other Lender or Issuer, Form W-9 (claiming exemption from
United States backup withholding tax) or any successor form. Unless the Borrower
and the Administrative Agent have received forms or other documents satisfactory
to them indicating that payments under any Loan Document to or for a Lender or
Issuer are not subject to United States withholding tax or are subject to such
tax at a rate reduced by an applicable tax treaty, the Loan Parties and the
Administrative Agent shall, notwithstanding anything in this Section 2.15 to the
contrary, withhold amounts required to be withheld by applicable Requirements of
Law from such payments at the applicable statutory rate and the Loan Parties
shall have no indemnification obligations pursuant to this Agreement or any
other Loan Document or be required to pay additional amounts pursuant to this
Section 2.15, with respect to amounts so withheld or any related amounts.
(g) Any Lender or Issuer claiming any additional amounts payable
pursuant to this Section 2.15 shall use its reasonable efforts (consistent with
its internal policies and Requirements of Law) to change the jurisdiction of its
Applicable Lending Office if the making of such a change would avoid the need
for, or reduce the amount of, any such additional amounts that would be payable
or may thereafter accrue and would not, in the sole reasonable determination of
such Lender or Issuer, be otherwise disadvantageous to such Lender or Issuer.
(h) If a Lender, Issuer or the Administrative Agent receives a refund
or realizes the benefit of a credit or reduction (including a refund of, credit
against, or reduction in any tax excluded from Taxes) in respect of any Taxes or
Other Taxes for which it has received an indemnity payment from (or an
additional amount has been paid by) a Loan Party, such Lender, Issuer or the
Administrative Agent shall within 45 days from the date of such receipt or
realization pay over the amount of such refund, credit or reduction to the Loan
Party (but only to the extent of indemnity payments made or other amounts paid
by the Loan Party under this Section 2.15 with respect to such Taxes or Other
Taxes), net of all reasonable out-of-pocket expenses of such Lender, Issuer or
the Administrative Agent incurred to apply for such refund, credit or reduction
and without interest (other than interest paid by the relevant Governmental
Authority with respect to such refund, credit or reduction), provided that the
Loan Party (upon written request of such Lender, Issuer or the Administrative
Agent) agrees to repay the amount paid over to the Loan Party to such Lender,
Issuer or the Administrative Agent in the event such Lender, Issuer or the
Administrative Agent is required to repay such refund, credit or reduction to
such Governmental Authority. Nothing in this paragraph shall require any Lender,
Issuer or the Administrative Agent to file for a refund credit or reduction or
to make available to a Loan Party any tax return or other information that the
Lender, Issuer or the Administrative Agent deems to be confidential or
proprietary.
(i) Notwithstanding anything to the contrary in this Section 2.15 or
in Section 11.2 (Assignments and Participations), a Loan Party shall not be
required to indemnify any Lender or Issuer (including, for purposes of this
paragraph, any participant or other transferee of any rights of a Lender or
Issuer) or the Administrative Agent, or to pay any additional amount to any
Lender, Issuer or the Administrative Agent, in respect of any Taxes pursuant to
this Section 2.15 to the extent that such Taxes were applicable on the date such
Lender, Issuer or the Administrative Agent became a party to this Agreement or,
with respect to payments to a new
55
Applicable Lending Office, the date such Lender or Issuer designated such
Applicable Lending Office.
Section 2.16 Substitution of Lenders
(a) In the event that (i) any Lender makes a claim under Section
2.13(c) (Increased Costs) or Section 2.14 (Capital Adequacy), (ii) it becomes
illegal for any Lender to continue to fund or make any Eurodollar Rate Loan and
such Lender notifies the Borrower pursuant to Section 2.13(d) (Illegality),
(iii) the Borrower is required to make any payment pursuant to Section 2.15
(Taxes) that is attributable to a particular Lender or (iv) any Lender becomes a
Non-Funding Lender, a Non-Consenting Lender or an Insolvent Lender, (any such
Lender, an "Affected Lender"), the Borrower may substitute any Lender and, if
reasonably acceptable to the Administrative Agent, any other Eligible Assignee
(a "Substitute Institution") for such Affected Lender hereunder, after delivery
of a written notice (a "Substitution Notice") within a reasonable time (in any
case not to exceed 90 days) following the occurrence of any of the events
described in clauses (i), (ii), (iii) or (iv) above by the Borrower to the
Administrative Agent and the Affected Lender that the Borrower intends to make
such substitution; provided, however, that, if more than one Lender claims
increased costs, illegality or right to payment arising from the same act or
condition and such claims are received by the Borrower within 30 days of each
other, then the Borrower may substitute all, but not (except to the extent the
Borrower has already substituted one of such Affected Lenders before the
Borrower's receipt of the other Affected Lenders' claim) less than all, Lenders
making such claims.
(b) If the Substitution Notice was properly issued under this Section
2.16, the Affected Lender shall sell, and the Substitute Institution shall
purchase, all rights and claims of such Affected Lender under the Loan Documents
and the Substitute Institution shall assume, and the Affected Lender shall be
relieved of, the Affected Lender's Revolving Credit Commitments and all other
prior unperformed obligations of the Affected Lender under the Loan Documents
(other than in respect of any damages (other than exemplary or punitive damages,
to the extent permitted by applicable law) in respect of any such unperformed
obligations). Such purchase and sale (and the corresponding assignment of all
rights and claims hereunder) shall be effective on (and not earlier than) the
later of (i) the receipt by the Affected Lender of its Ratable Portion of the
Revolving Credit Outstandings, the Term Loans, together with any other
Obligations owing to it, (ii) the receipt by the Administrative Agent of an
agreement in form and substance satisfactory to it and the Borrower whereby the
Substitute Institution shall agree to be bound by the terms hereof and (ii) the
payment in full to the Affected Lender in cash of all fees, unreimbursed costs
and expenses and indemnities accrued and unpaid through such effective date.
Upon the effectiveness of such sale, purchase and assumption, the Substitute
Institution shall become a "Lender" hereunder for all purposes of this Agreement
having a Commitment in the amount of such Affected Lender's Commitment assumed
by it and such Commitment of the Affected Lender shall be terminated; provided,
however, that all indemnities under the Loan Documents shall continue in favor
of such Affected Lender.
(c) Each Lender agrees that, if it becomes an Affected Lender and its
rights and claims are assigned hereunder to a Substitute Institution pursuant to
this Section 2.16, it shall execute and deliver to the Administrative Agent an
Assignment and Acceptance to evidence such assignment, together with any Note
(if such Loans are evidenced by a Note) evidencing the Loans subject to such
Assignment and Acceptance; provided, however, that the failure of any Affected
Lender to execute an Assignment and Acceptance shall not render such assignment
invalid.
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Section 2.17 Facility Increase.
(a) The Borrower may (no more frequently than once during the term of
the Facilities) request the Lenders or other institutions that would be Eligible
Assignees to provide additional Commitments (with respect to either the Term
Loan Facility or the Revolving Credit Facility, at the option of the Borrower)
up to an aggregate amount not in excess of $100,000,000 (a "Facility Increase");
provided, however, that (i) the Borrower shall have given the Administrative
Agent at least 60 days notice of its intention to effect the Facility Increase
and the desired amount of such Facility Increase, (ii) the conditions precedent
to a Borrowing set forth in Section 3.2 are satisfied as of the Facility
Increase Effective Date (as defined below), (iii) the Administrative Agent shall
have received on or prior to the Facility Increase Effective Date, a certificate
of the Secretary or an Assistant Secretary of each Loan Party, in form and
substance satisfactory to the Administrative Agent, certifying the resolutions
of such Loan Party's board of directors (or equivalent governing body) approving
and authorizing the Facility Increase to the extent of the stated desired amount
of such Facility Increase, and (iv) an opinion of counsel to the Loan Parties in
form and substance and from counsel satisfactory to the Administrative Agent and
addressed to the Administrative Agent, the Issuers and the Lenders dated the
Facility Increase Effective Date and addressing such matters as the
Administrative Agent may reasonably request shall be delivered to the
Administrative Agent.
(b) The Borrower shall have the right to offer such increase to (x)
the Lenders, and each Lender will have the right, but not the obligation, to
commit to all or a portion of the proposed Facility Increase or (y) any
institution that would be an Eligible Assignee; provided, however, that the
minimum additional Commitment of each Eligible Assignee in respect of Revolving
Credit Commitments equals or exceeds $5,000,000 and the minimum additional
Commitment of each Eligible Assignee in respect of Term Loans Commitments equals
or exceeds $2,000,000 and such Lender or Eligible Assignee executes an
Assumption Agreement pursuant to which such Lender or Eligible Assignee agrees
to commit to all or a portion of such Facility Increase and, in the case of an
Eligible Assignee, to be bound by the terms of this Agreement as a Lender.
(c) On the effective date provided for in the Assumption Agreements
providing for a Facility Increase (each a "Facility Increase Effective Date"),
(i) the Commitments will be increased by the additional amount committed to by
each Lender or Eligible Assignee on the Facility Increase Date, (ii) the Letter
of Credit Sublimit, to the extent agreed in writing by each applicable Issuer,
shall be increased as set forth in the definition thereof, on the Facility
Increase Date and (iii) to the extent the Facility Increase results in any
Revolving Credit Lender owning less than its Ratable Portion of the Revolving
Loans, such Revolving Credit Lender shall purchase from each other Revolving
Credit Lender Revolving Loans such that after giving effect to such purchases,
each Revolving Credit Lender owns Revolving Loans is an amount equal to its
Ratable Portion of all Revolving Loans.
(d) In the event there are Lenders and Eligible Assignees that have
committed to a Facility Increase in excess of the maximum amount requested (or
permitted), then the Agents (with the consent of the Borrower which shall not be
unreasonably withheld) shall have the right to allocate such commitments, first
to Lenders and then to Eligible Assignees.
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ARTICLE III
Conditions To Loans And Letters Of Credit
Section 3.1 Conditions Precedent to Initial Loans and Letters of
Credit
The obligation of each Lender to make the Loans requested to be made
by it on the Closing Date and the obligation of each Issuer to Issue Letters of
Credit on the Closing Date is subject to the satisfaction or due waiver in
accordance with Section 11.1 (Amendments, Waivers, Etc.) of each of the
following conditions precedent:
(a) Certain Documents. The Administrative Agent shall have received on
or prior to the Closing Date each of the following, each dated the Closing Date
unless otherwise indicated or agreed to by the Administrative Agent, in form and
substance satisfactory to the Administrative Agent and in sufficient copies for
each Lender that requests same:
(i) this Agreement, duly executed and delivered by the Borrower
and Holdings and, for the account of each Lender requesting the same, a
Note or Notes of the Borrower conforming to the requirements set forth
herein;
(ii) the Guaranty, duly executed by each Guarantor;
(iii) the Pledge and Security Agreement, duly executed by the
Borrower and each Guarantor, together with each of the following:
(A) evidence satisfactory to the Administrative Agent that,
upon the filing and recording of instruments delivered at the Closing,
the Administrative Agent (for the benefit of the Secured Parties)
shall have a valid and perfected first priority (subject, other than
in the case of Stock of a ▇▇▇▇▇▇ Entity, to Liens permitted by Section
8.2(b), Section 8.2(c), Section 8.2(d), Section 8.2(h), or Section
8.2(j) (Liens. Etc.) security interest in the Collateral, including
(x) such documents duly executed by each Loan Party as the
Administrative Agent may request with respect to the perfection of its
security interests in the Collateral (including financing statements
under the UCC, patent, trademark and copyright security agreements
suitable for filing with the Patent and Trademark Office or the
Copyright Office, as the case may be, and other applicable documents
under the laws of any jurisdiction with respect to the perfection of
Liens created by the Pledge and Security Agreement), (y) copies of UCC
search reports as of a recent date listing all effective financing
statements that name any Loan Party as debtor, together with copies of
such financing statements, none of which shall cover the Collateral
except for those that shall be terminated on the Closing Date or are
otherwise permitted hereunder, and (z) UCC insurance policies insuring
proper perfection covering "as extracted" coal, if requested by the
Administrative Agent;
(B) all certificates, instruments and other documents
representing all Pledged Stock being pledged pursuant to such Pledge
and Security Agreement and stock powers for such certificates,
instruments and other documents executed in blank;
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(C) all instruments representing Pledged Debt Instruments
being pledged pursuant to such Pledge and Security Agreement duly
endorsed in favor of the Administrative Agent or in blank;
(D) all Deposit Account Control Agreements, duly executed by
the corresponding Deposit Account Bank and Loan Party, that, in the
reasonable judgment of the Administrative Agent, shall be required for
the Loan Parties to comply with Section 7.15 (Approved Deposit
Accounts; Securities Accounts); and
(E) Control Account Agreements duly executed by the
appropriate Loan Party and (1) all securities intermediaries with
respect to all Securities Accounts and securities entitlements of the
Borrower and each Guarantor and (2) all futures commission agents and
clearing houses with respect to all commodities contracts and
commodities accounts held by the Borrower and each Guarantor;
(iv) Mortgages for all of the Real Properties of the Loan Parties
identified on Schedule 4.22(b) (Owned Real Property), and for all of the
leasehold interests of the Loan Parties in the Real Properties identified
on Schedule 4.22(c) (Mining Leases and Prep Plant Leases) (other than those
Leases constituting part of ▇▇▇▇▇▇▇ or Westvaco), in each case, except as
may be agreed to by the Administrative Agent, together with all applicable
Mortgage Supporting Documents relating thereto; provided, however, that
such Mortgages, by their express terms, shall not be effective as to any
such leasehold interests of the Loan Parties (notwithstanding the
execution, delivery and recordation of any Mortgage related thereto) to the
extent such leasehold interest is not mortgageable or assignable without
the applicable lessor's consent and such consent has not been obtained;
(v) the Securitization Intercreditor Agreement in form and
substance satisfactory to the Administrative Agent, duly executed by the
parties thereto;
(vi) a favorable opinion of (A) Hunton & ▇▇▇▇▇▇▇▇, counsel to the
Loan Parties, in substantially the form of Exhibit F-1 (Form of Opinion of
Counsel for the Loan Parties), (B) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, general counsel to
the Loan Parties, in substantially the form of Exhibit F-2 (Form of Opinion
of Counsel for the Loan Parties), (C) counsel to the Loan Parties in each
of Kentucky, Louisiana and Tennessee and West Virginia,, in each case
addressed to the Administrative Agent and the Lenders and addressing such
other matters as any Lender through the Administrative Agent may reasonably
request and (D) counsel to the Administrative Agent as to the
enforceability of this Agreement and the other Loan Documents to be
executed on the Closing Date;
(vii) a copy of the articles or certificate of incorporation (or
equivalent Constituent Document) of each Loan Party, certified as of a
recent date by the Secretary of State of the state of organization of such
Loan Party, together with certificates of such official attesting to the
good standing of each such Loan Party;
(viii) a certificate of the Secretary or an Assistant Secretary
of each Loan Party certifying (A) the names and true signatures of each
officer of such Loan Party that has been authorized to execute and deliver
any Loan Document or other
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document required hereunder to be executed and delivered by or on behalf of
such Loan Party, (B) the by-laws (or equivalent Constituent Document) of
such Loan Party as in effect on the date of such certification, (C) the
resolutions of such Loan Party's Board of Directors (or equivalent
governing body) approving and authorizing the execution, delivery and
performance of this Agreement and the other Loan Documents to which it is a
party and (D) that there have been no changes in the certificate of
incorporation (or equivalent Constituent Document) of such Loan Party from
the certificate of incorporation (or equivalent Constituent Document)
delivered pursuant to clause (vii) above;
(ix) a certificate of the chief financial officer of Holdings,
stating that the Borrower is Solvent after giving effect to the initial
Loans and Letters of Credit, the application of the proceeds thereof in
accordance with Section 7.10 (Application of Proceeds) and the payment of
all estimated legal, accounting and other fees related hereto and thereto;
(x) a certificate of a Responsible Officer of Holdings to the
effect that (A) the condition set forth in Section 3.2(b) (Conditions
Precedent to Each Loan and Letter of Credit) has been satisfied and (B) no
litigation shall have been commenced against any Loan Party or any of its
Subsidiaries that, if adversely determined, would have a Material Adverse
Effect;
(xi) evidence satisfactory to the Administrative Agent that the
insurance policies required by Section 7.5 (Maintenance of Insurance) and
any Collateral Document are in full force and effect, together with
endorsements naming the Administrative Agent, on behalf of the Secured
Parties, as an additional insured or loss payee under all insurance
policies maintained with respect to the properties of Holdings, the
Borrower and its Subsidiaries; and
(xii) such other certificates, documents, agreements and
information respecting any Loan Party as any Lender through the
Administrative Agent may reasonably request.
(b) Bailee's Letters. The Administrative Agent shall have received
such Bailee's Letters from each third party on whose premises any Loan Party has
stored coal valued at in excess of $1,000,000.
(c) Financial Information. The Lenders shall have received and be
satisfied with (i) a pro forma estimated balance sheet of Holdings and its
Subsidiaries as of the Closing Date and after giving effect to the Facilities,
(ii) interim unaudited quarterly financial statements of Holdings and its
Subsidiaries through the most recently completed Fiscal Quarter which ended 45
days or more prior to the Closing Date, and (iii) Holdings' business plan which
shall include a financial forecast on a quarterly basis for the first fiscal
year ending December 2003 and on an annual basis thereafter through the Term
Loan Maturity Date prepared by Holdings' management.
(d) Fees and Expenses Paid. There shall have been paid to the
Administrative Agent, for the account of the Administrative Agent, the Arrangers
and the Lenders, as applicable, all fees and expenses (including reasonable fees
and expenses of counsel)
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due and payable on or before the Closing Date (including all such fees described
in the Fee Letter).
(e) Refinancing of Existing Credit Agreement. (i) All obligations
under the Existing Credit Agreements shall have been repaid in full, (ii) the
Existing Credit Agreements and all Loan Documents (as defined therein) shall
have been terminated on terms satisfactory to the Administrative Agent and (iii)
the Administrative Agent shall have received a payoff letter duly executed and
delivered by Holdings and each Existing Lender or other evidence of such
termination in each case in form and substance satisfactory to the
Administrative Agent.
(f) Consents, Etc. Each of Holdings and its Subsidiaries shall have
received all consents and authorizations required pursuant to any material
Contractual Obligation with any other Person (other than the consents of
lessors, as described in Section 3.1(a)(iv) above, the receipts of such consents
shall not be conditions precedent under this Section 3.1(f)) and shall have
obtained all Permits of, and effected all notices to and filings with, any
Governmental Authority, in each case, as may be necessary to allow each of
Holdings and its Subsidiaries lawfully (i) to execute, deliver and perform, in
all material respects, their respective obligations hereunder and under the Loan
Documents to which each of them, respectively, is, or shall be, a party and each
other agreement or instrument to be executed and delivered by each of them,
respectively, pursuant thereto or in connection therewith, and (ii) to create
and perfect the Liens on the Collateral to be owned by each of them in the
manner and for the purpose contemplated by the Loan Documents.
Section 3.2 Conditions Precedent to Each Loan and Letter of Credit
The obligation of each Lender on any date (including the Closing Date)
to make any Loan and of each Issuer on any date (including the Closing Date) to
Issue any Letter of Credit is subject to the satisfaction of each of the
following conditions precedent:
(a) Request for Borrowing or Issuance of Letter of Credit. With
respect to any Loan, the Administrative Agent shall have received a duly
executed Notice of Borrowing, and, with respect to any Letter of Credit, the
Administrative Agent and the Issuer shall have received a duly executed Letter
of Credit Request.
(b) Representations and Warranties; No Defaults. The following
statements shall be true on the date of such Loan or Issuance, both before and
after giving effect thereto and, in the case of any Loan, to the application of
the proceeds therefrom:
(i) the representations and warranties set forth in Article IV
(Representations and Warranties) and in the other Loan Documents shall be
true and correct on and as of the Closing Date and shall be true and
correct in all material respects on and as of any such date after the
Closing Date with the same effect as though made on and as of such date,
except to the extent such representations and warranties expressly relate
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; and
(ii) no Default or Event of Default shall have occurred and be
continuing.
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(c) No Legal Impediments. The making of the Loans or the Issuance of
such Letter of Credit on such date does not violate any Requirement of Law on
the date of or immediately following such Loan or Issuance of such Letter of
Credit and is not enjoined, temporarily, preliminarily or permanently.
Each submission by the Borrower to the Administrative Agent of a Notice of
Borrowing and the acceptance by the Borrower of the proceeds of each Loan
requested therein, and each submission by the Borrower to an Issuer of a Letter
of Credit Request, and the Issuance of each Letter of Credit requested therein,
shall be deemed to constitute a representation and warranty by the Borrower as
to the matters specified in clause (b) above on the date of the making of such
Loan or the Issuance of such Letter of Credit.
Section 3.3 Determinations of Initial Borrowing Conditions
For purposes of determining compliance with the conditions specified
in Section 3.1 (Conditions Precedent to Initial Loans and Letters of Credit),
each Lender shall be deemed to have consented to, approved, accepted or be
satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to the Lenders unless
an officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
prior to the initial Borrowing or Issuance hereunder specifying its objection
thereto and such Lender shall not have made available to the Administrative
Agent such Lender's Ratable Portion of such Borrowing.
ARTICLE IV
Representations and Warranties
To induce the Lenders, the Issuers and the Administrative Agent to
enter into this Agreement, each of Holdings and the Borrower represents and
warrants each of the following to the Lenders, the Issuers and the
Administrative Agent, on and as of the Closing Date and after giving effect to
the making of the Loans and the other financial accommodations on the Closing
Date and on and as of each date as required by Section 3.2(b)(i) (Conditions
Precedent to Each Loan and Letter of Credit):
Section 4.1 Corporate Existence; Compliance with Law
Each of Holdings, the Borrower and their respective Subsidiaries (a)
is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (b) is duly qualified to do business as a
foreign corporation and in good standing under the laws of each jurisdiction
where such qualification is necessary, except where the failure to be so
qualified or in good standing would not, in the aggregate, have a Material
Adverse Effect, (c) has all requisite power and authority and the legal right to
own, pledge, mortgage and operate its properties, to lease the property it
operates under lease and to conduct its business as now conducted, (d) is in
compliance with its Constituent Documents, (e) is in compliance with all
applicable Requirements of Law except where the failure to be in compliance
would not, in the aggregate, have a Material Adverse Effect and (f) has all
necessary licenses, Permits (including Mining Permits), consents or approvals
from or by, has made all necessary filings with, and has given all necessary
notices to, each Governmental Authority having jurisdiction, to the extent
required to carry out its business as presently conducted, except for licenses,
permits, consents,
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approvals or filings that can be obtained or made by the taking of ministerial
action to secure the grant or transfer thereof or the failure to obtain or make
would not, in the aggregate, have a Material Adverse Effect.
Section 4.2 Corporate Power; Authorization; Enforceable Obligations
(a) The execution, delivery and performance by each Loan Party of the
Loan Documents to which it is a party and the consummation of the transactions
contemplated thereby:
(i) are within such Loan Party's corporate, limited liability
company, partnership or other powers;
(ii) have been or, at the time of delivery thereof pursuant to
Article III (Conditions To Loans And Letters Of Credit) will have been duly
authorized by all necessary action, including the consent of shareholders,
partners and members where required;
(iii) do not and will not (A) contravene such Loan Party's or any
of its Subsidiaries' respective Constituent Documents, (B) violate any
other Requirement of Law applicable to such Loan Party (including
Regulations T, U and X of the Federal Reserve Board), or any order or
decree of any Governmental Authority or arbitrator applicable to such Loan
Party, (C) conflict with or result in the breach of, or constitute a
default under, or result in or permit the termination or acceleration of,
any Contractual Obligation of such Loan Party or any of its Subsidiaries or
(D) result in the creation or imposition of any Lien upon any property of
such Loan Party or any of its Subsidiaries, other than those in favor of
the Secured Parties pursuant to the Collateral Documents; and
(iv) do not require the consent of, authorization by, approval
of, notice to, or filing or registration with, any Governmental Authority
or any other Person other than those that have been or will be, prior to
the Closing Date, obtained or made, copies of which have been or will be
delivered to the Administrative Agent pursuant to Section 3.1 (Conditions
Precedent to Initial Loans and Letters of Credit), and each of which on the
Closing Date will be in full force and effect and, with respect to the
Collateral, filings required to perfect the Liens created by the Collateral
Documents.
(b) This Agreement has been, and each of the other Loan Documents will
have been upon delivery thereof pursuant to the terms of this Agreement, duly
executed and delivered by each Loan Party party thereto. This Agreement is, and
the other Loan Documents will be, when delivered hereunder, the legal, valid and
binding obligation of each Loan Party party thereto, enforceable against such
Loan Party in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally, and subject, as to
enforceability to general principles of equity, including principles of
commercial reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity).
Section 4.3 Ownership of Borrower; Subsidiaries
(a) Set forth on Schedule 4.3 (Ownership of Subsidiaries) is a
complete and accurate list showing, as of the Closing Date, all Subsidiaries of
Holdings and, as to each such Subsidiary, the jurisdiction of its organization,
the number of shares of each class of Stock
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authorized (if applicable), the number outstanding on the Closing Date and the
number and percentage of the outstanding shares of each such class owned
(directly or indirectly) by a ▇▇▇▇▇▇ Entity.
(b) No Stock of any Subsidiary of Holdings is subject to any
outstanding option, warrant, right of conversion or purchase of any similar
right.
(c) All of the outstanding Stock of each Subsidiary of Holdings owned
(directly or indirectly) by Holdings has been validly issued, is fully paid and
non-assessable (to the extent applicable) and is owned by Holdings or a
Subsidiary of Holdings, free and clear of all Liens (other than the Lien in
favor of the Secured Parties created pursuant to the Pledge and Security
Agreement), options, warrants, rights of conversion or purchase or any similar
rights. Neither Holdings nor any such Subsidiary is a party to, or has knowledge
of, any agreement restricting the transfer or hypothecation of any Stock of any
such Subsidiary, other than the Loan Documents.
(d) There are no agreements or understandings to which any ▇▇▇▇▇▇
Entity is a party with respect to the voting, sale or transfer of any shares of
Stock of any ▇▇▇▇▇▇ Entity.
(e) No ▇▇▇▇▇▇ Entity owns or holds, directly or indirectly, any Stock
of any Person other than such Subsidiaries and Investments permitted by Section
8.3 (Investments).
Section 4.4 Financial Statements
(a) The Consolidated balance sheet of Holdings and its Subsidiaries as
at December 31, 2002, and the related Consolidated statements of income,
retained earnings and cash flows of Holdings and its Subsidiaries for the fiscal
year then ended, certified by Ernst &Young LLP, and the Consolidated unaudited
balance sheets of Holdings and its Subsidiaries as at March 31, 2003, copies of
which have been furnished to each Lender, fairly present, subject, in the case
of said unaudited balance sheets as at March 31, 2003, and said statements of
income, retained earnings and cash flows for the three-month period then ended,
to the absence of footnote disclosure and normal year-end audit adjustments, the
Consolidated financial condition of Holdings and its Subsidiaries as at such
dates and the Consolidated results of the operations of Holdings and its
Subsidiaries for the period ended on such dates, all in conformity with GAAP.
(b) Neither Holdings, the Borrower nor any of their respective
Subsidiaries has any material obligation, contingent liability or liability for
taxes, long-term leases or unusual forward or long-term commitment that is not
reflected in the Financial Statements referred to in clause (a) above or in the
notes thereto and not otherwise permitted by this Agreement.
(c) The Projections have been prepared by Holdings in light of the
past operations of its business, and reflect projections for the Fiscal Year
period beginning on January 1, 2003 on a quarter by quarter basis for the first
year and on a year by year basis thereafter. The Projections are based upon
estimates and assumptions stated therein, all of which Holdings believes to be
reasonable and fair in light of current conditions and current facts known to
Holdings and, as of the Closing Date, reflect Holdings' good faith and
reasonable estimates of the future financial performance of Holdings and its
Subsidiaries and of the other information projected therein for the periods set
forth therein.
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(d) The unaudited pro forma Consolidated balance sheet of Holdings and
its Subsidiaries, a copy of which has been delivered to each Lender pursuant to
Section 3.1 (Conditions Precedent to Initial Loans and Letters of Credit), has
been prepared as of June 30, 2003, on a pro forma basis, the Consolidated
financial condition of Holdings and its Subsidiaries, and the assumptions
expressed therein were reasonable based on the information available to Holdings
at the time so furnished and on the Closing Date.
(e) To the extent required by GAAP, Holdings and its Subsidiaries
maintain adequate reserves for (i) future costs associated with any lung disease
claim alleging pneumoconiosis or silicosis or arising out of exposure or alleged
exposure to coal dust or the coal mining environment, (ii) future costs
associated with retiree and health care benefits, (iii) future costs associated
with reclamation of disturbed acreage, removal of facilities and other closing
costs in connection with its mining operations and (iv) future costs associated
with other potential environmental liabilities.
Section 4.5 Material Adverse Change
Since December 31, 2002, there has been no Material Adverse Change and
there have been no events or developments that, in the aggregate, have had a
Material Adverse Effect.
Section 4.6 Solvency
Both before and after giving effect to (a) the Loans and Letter of
Credit Obligations to be made or extended on the Closing Date or such other date
as Loans and Letter of Credit Obligations requested hereunder are made or
extended, (b) the disbursement of the proceeds of such Loans pursuant to the
instructions of the Borrower, and (c) the payment and accrual of all transaction
costs in connection with the foregoing, Holdings and its Subsidiaries, taken
together as a single entity, are Solvent.
Section 4.7 Litigation
There are no pending or, to the knowledge of Holdings or the Borrower,
overtly threatened actions, investigations or proceedings as to which there is a
reasonable probability of an adverse determination affecting any ▇▇▇▇▇▇ Entity
before any court, Governmental Authority or arbitrator other than those that, in
the aggregate, would not have a Material Adverse Effect. The performance by any
Loan Party required of its payment or guaranty obligations under any Loan
Document is not restrained or enjoined (either temporarily, preliminarily or
permanently).
Section 4.8 Taxes
(a) All federal, state, local and foreign income and franchise and
other material tax returns, reports and statements (collectively, the "Tax
Returns") required to be filed by Holdings or any of its Tax Affiliates have
been filed with the appropriate Governmental Authorities in all jurisdictions in
which such Tax Returns are required to be filed, all such Tax Returns are true
and correct in all material respects, and all material taxes, charges and other
impositions reflected therein or otherwise due and payable pursuant to any
assessment have been paid prior to the date on which any fine, penalty,
interest, late charge or loss may be added thereto for non-payment thereof
except where contested in good faith and by appropriate proceedings if adequate
reserves therefor have been established on the books of Holdings or such Tax
Affiliate in conformity with GAAP. Except as set forth on Schedule 4.8(a)
(Taxes), no Tax Return is
65
under audit or examination by any Governmental Authority and no notice of such
an audit or examination or any assertion of any claim for Taxes has been given
or made by any Governmental Authority. Proper and accurate amounts (other than
those that in the aggregate do not exceed $1,000,000 at any time) have been
withheld by Holdings and each of its Tax Affiliates from their respective
employees for all periods in full and complete compliance with the tax, social
security and unemployment withholding provisions of applicable Requirements of
Law and such withholdings have been timely paid to the respective Governmental
Authorities.
(b) Except as disclosed on Schedule 4.8(b) (Taxes) and except for
extensions of six months or less for the time to file federal income and state
income (or franchise) tax returns, none of Holdings or any of its Tax Affiliates
has (i) executed or filed with the IRS or any other Governmental Authority any
agreement or other document extending, or having the effect of extending, the
period for the filing of any Tax Return for any open taxable period or the
assessment or collection of any charges for any open taxable period, (ii)
incurred any unpaid obligation under any tax sharing agreement or arrangement
other than those of which the Administrative Agent has received a copy prior to
the date hereof or (iii) been a member of an affiliated, combined or unitary
group other than the group of which Holdings or Borrower (or its Tax Affiliate)
is the common parent for any open taxable period.
Section 4.9 Full Disclosure
(a) The information prepared or furnished by or on behalf of Holdings
or the Borrower in connection with this Agreement or the consummation of the
transactions contemplated hereunder and thereunder taken as a whole, including
the information contained in the Disclosure Documents, does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements contained therein or herein not misleading.
(b) Holdings has delivered to each Lender a true, complete and correct
copy of the Disclosure Document. The Disclosure Document complies as to form in
all material respects with all applicable requirements of all applicable state
and Federal securities laws.
Section 4.10 Margin Regulations
Neither Holdings nor the Borrower is engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulation U of the Federal Reserve Board), and no proceeds of
any Loan will be used to purchase or carry any such margin stock or to extend
credit to others for the purpose of purchasing or carrying any such margin stock
in contravention of Regulation T, U or X of the Federal Reserve Board.
Section 4.11 No Burdensome Restrictions; No Defaults
(a) Neither Holdings, the Borrower nor any of their respective
Subsidiaries (i) is a party to any Contractual Obligation the compliance with
one or more of which would have, in the aggregate, a Material Adverse Effect or
the performance of which by any thereof, either unconditionally or upon the
happening of an event, would result in the creation of a Lien (other than a Lien
permitted under Section 8.2 (Liens, Etc.)) on the assets of any thereof or (ii)
is subject to one or more charter or corporate restrictions that would, in the
aggregate, have a Material Adverse Effect.
66
(b) Neither Holdings, the Borrower nor any of their respective
Subsidiaries is in default under or with respect to any Contractual Obligation
owed by it and, to the knowledge of Holdings and the Borrower, no other party is
in default under or with respect to any Contractual Obligation owed to any Loan
Party or to any Subsidiary of a Loan Party, other than, in either case, those
defaults that, in the aggregate, would not have a Material Adverse Effect.
(c) No Default or Event of Default has occurred and is continuing.
(d) To the best knowledge of each of Holdings and the Borrower, there
are no Requirements of Law applicable to any ▇▇▇▇▇▇ Entity the compliance with
which by such ▇▇▇▇▇▇ Entity, as the case may be, would, in the aggregate, have a
Material Adverse Effect.
Section 4.12 Investment Company Act; Public Utility Holding Company
Act
Neither Holdings, the Borrower nor any of their respective
Subsidiaries is (a) an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended or (b) a
"holding company," or an "affiliate" or a "holding company" or a "subsidiary
company" of a "holding company," as each such term is defined and used in the
Public Utility Holding Company Act of 1935, as amended.
Section 4.13 Use of Proceeds
The proceeds of the Loans and the Letters of Credit are being used by
the Borrower solely (a) to fund a dividend or intercompany loan to Holdings
solely for the purpose of refinancing all Indebtedness of Holdings and other
obligations (including those of the Borrower as a guarantor) outstanding under
the Existing Credit Agreements, (b) for the payment of transaction costs, fees
and expenses incurred in connection with this Agreement and the transactions
contemplated hereby, (c) for working capital and general corporate purposes of
Holdings and its Subsidiaries (provided, that $100,000,000 of the Term Loans
shall be maintained as either Restricted Cash or Letter of Credit Support until
such time as it is applied to repay the Loans in accordance with Section 2.8
(Mandatory Prepayments)).
Section 4.14 Insurance
All policies of insurance of any kind or nature of any ▇▇▇▇▇▇ Entity,
including policies of life, fire, theft, product liability, public liability,
property damage, other casualty, employee fidelity, workers' compensation and
employee health and welfare insurance, are in full force and effect and are of a
nature and provide such coverage as is sufficient for the business and
operations of the ▇▇▇▇▇▇ Entities and which coverage is not significantly less
coverage than is customarily carried by businesses of the size and character of
such Person. No ▇▇▇▇▇▇ Entity has been refused insurance for any material
coverage for which it had applied or had any policy of insurance terminated
(other than at its request).
Section 4.15 Labor Matters
(a) There are no strikes, work stoppages, slowdowns or lockouts
pending or, to the best knowledge of Holdings or the Borrower, overtly
threatened against or involving any ▇▇▇▇▇▇ Entity, other than those that, in the
aggregate, would not have a Material Adverse Effect.
67
(b) There are no unfair labor practices, grievances or complaints
pending, or, to either Holdings' or the Borrower's knowledge, threatened,
against or involving any ▇▇▇▇▇▇ Entity, nor are there any arbitrations or
grievances threatened involving any ▇▇▇▇▇▇ Entity, other than those that, in the
aggregate, would not have a Material Adverse Effect.
(c) Except as set forth on Schedule 4.15 (Labor Matters), as of the
Closing Date, there is no collective bargaining agreement covering any employee
of any ▇▇▇▇▇▇ Entity.
(d) Holdings has delivered to the Lenders all material consulting
agreements, executive employment agreements, executive compensation plans,
deferred compensation agreements, employee stock purchase and stock option plans
and severance plans of the ▇▇▇▇▇▇ Entities.
Section 4.16 ERISA
(a) Schedule 4.16 (List of Plans) separately identifies as of the date
hereof all Title IV Plans, all Multiemployer Plans and all Retiree Medical Plans
to which any ▇▇▇▇▇▇ Entity has any obligation or liability, contingent or
otherwise have been provided to the Lenders.
(b) Each Title IV Plan is in compliance in all material respects with
applicable provisions of ERISA, the Code and other Requirements of Law except
for non-compliances that, in the aggregate, would not have a Material Adverse
Effect.
(c) There has been no, nor is there reasonably expected to occur, any
ERISA Event other than those that, in the aggregate, would not have a Material
Adverse Effect.
(d) Except as set forth on Schedule 4.16 (List of Plans), no ▇▇▇▇▇▇
Entity or any ERISA Affiliate would have any Withdrawal Liability as a result of
a complete withdrawal as of the date hereof from any Multiemployer Plan.
Section 4.17 Coal Act; Black Lung Act
Each ▇▇▇▇▇▇ Entity and each of its "related persons" (as defined in
the Coal Act) are in compliance in all material respects with the Coal Act and
no ▇▇▇▇▇▇ Entity or any of its related persons has any liability under the Coal
Act except with respect to premiums or other payments required thereunder which
have been paid when due and except to the extent that the liability thereunder
would not reasonably be expected to have a Material Adverse Effect. Each ▇▇▇▇▇▇
Entity is in compliance in all material respects with the Black Lung Act, and no
▇▇▇▇▇▇ Entity has any liability under the Black Lung Act except with respect to
premiums, contributions or other payments required thereunder which have been
paid when due and except to the extent that the liability thereunder would not
reasonably be expected to have a Material Adverse Effect.
Section 4.18 Environmental Matters
(a) The operations of each ▇▇▇▇▇▇ Entity have been and are in
compliance with all Environmental Laws, including obtaining and complying with
all Permits required under Environmental Laws, other than non-compliances that,
in the aggregate, would not have a reasonable likelihood of the ▇▇▇▇▇▇ Entities
incurring Environmental Liabilities and Costs after the date hereof that, in the
aggregate, would be reasonably likely to have a Material Adverse Effect.
68
(b) No ▇▇▇▇▇▇ Entity or any real property currently or, to the
knowledge of Holdings or the Borrower, previously owned, operated or leased by
or for any ▇▇▇▇▇▇ Entity is subject to any pending or, to the knowledge of
Holdings or the Borrower, threatened, claim, order, agreement, notice of
violation, notice of potential liability or is the subject of any pending or, to
the knowledge of Holdings or the Borrower, threatened proceeding or governmental
investigation under or pursuant to Environmental Laws other than those that, in
the aggregate, are not reasonably likely to result in the ▇▇▇▇▇▇ Entities
incurring Environmental Liabilities and Costs that, in the aggregate, would be
reasonably likely to have a Material Adverse Effect.
(c) Except as disclosed on Schedule 4.18 (Environmental Matters), no
▇▇▇▇▇▇ Entity is a treatment, storage or disposal facility requiring a Permit
under the Resource Conservation and Recovery Act, 42 U.S.C.(S) 6901 et seq., the
regulations thereunder or any state counter part equivalent.
(d) There are no facts, circumstances or conditions arising out of or
relating to the operations or ownership of any ▇▇▇▇▇▇ Entity or of real property
owned, operated or leased by any ▇▇▇▇▇▇ Entity, including, but not limited to,
any Release of Hazardous Materials, that are not specifically included in the
financial information furnished to the Lenders other than those that, in the
aggregate, would not have a reasonable likelihood of the ▇▇▇▇▇▇ Entities
incurring Environmental Liabilities and Costs that, in the aggregate, would be
reasonably likely to have a Material Adverse Effect.
(e) As of the date hereof, no Environmental Lien has attached to any
property of any ▇▇▇▇▇▇ Entity and, to the knowledge of Holdings or the Borrower,
no facts, circumstances or conditions exist that could reasonably be expected to
result in any such Lien attaching to any such property.
(f) Holdings and the Borrower have made available to the Lenders
copies of all environmental, health or safety audits, studies, assessments,
inspections, investigations or other environmental health and safety reports
relating to the operations of the ▇▇▇▇▇▇ Entities or any real property of any of
them that are in the possession, custody or control of any ▇▇▇▇▇▇ Entity.
Section 4.19 Intellectual Property
The ▇▇▇▇▇▇ Entities own or license or otherwise have the right to use
all licenses, permits, patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, copyright applications,
franchises, authorizations and other intellectual property rights (including all
Intellectual Property as defined in the Pledge and Security Agreement) that are
necessary for the operations of their respective businesses as currently
conducted, without, to Holdings' knowledge, infringement upon or conflict with
the rights of any other Person with respect thereto, including all trade names
associated with any private label brands of any ▇▇▇▇▇▇ Entity except for those
failures and infringements that would not have a Material Adverse Effect. To
Holdings' and the Borrower's knowledge, no Intellectual Property, no slogan or
other advertising device, product, process, method, substance, part or
component, or other material now employed, or now contemplated to be employed,
by any ▇▇▇▇▇▇ Entity infringes upon or conflicts with any rights owned by any
other Person, and no claim or litigation regarding any of the foregoing is
pending or threatened other than those which, in the aggregate, would not have a
Material Adverse Effect.
69
Section 4.20 Coal Supply Agreements
Schedule 4.20 (Coal Supply Agreements) sets forth a complete and
accurate list of each Coal Supply Agreement to which any ▇▇▇▇▇▇ Entity is a
party as of the Closing Date, including the counterparty to each such agreement.
As of the Closing Date, each such Coal Supply Agreement is in full force and
effect, except to the extent that the failure to be in full force and effect
would not reasonably be expected to have a Material Adverse Effect.
Section 4.21 Surety Bonds
All surety, reclamation and similar bonds required to be maintained by
any ▇▇▇▇▇▇ Entity under any Requirement of Law, including any Mining Law, or
Contractual Obligation are in full force and effect and were not and will not be
terminated, suspended, revoked or otherwise adversely affected by virtue of the
execution and delivery of the Loan Documents and the funding of the Facilities
thereunder; provided that (i) self-bonding permitted under Requirements of Law
prior to the Closing Date may be required to be replaced following the Closing
Date with surety bonds, (ii) the cost of such bonds may be increased and (iii)
certain of such bonds may be terminated, suspended or revoked, provided that,
taken together, the events specified in clauses (i), (ii) and (iii) above would
not reasonably be expected to have a Material Adverse Effect. All required
guarantees of, and letters of credit with respect to, such surety, reclamation
and similar bonds are in full force and effect except where such failure to be
in full force and effect would not reasonably be expected to have a Material
Adverse Effect.
Section 4.22 Title; Real Property; Titled Personal Equipment
(a) Subject to Customary Permitted Liens which would not have a
Material Adverse Effect on the operation and use of such property, each ▇▇▇▇▇▇
Entity has good and marketable title to, or valid leasehold interests in, all
Real Property (including surface rights and coal and other mineral rights and
Mining Permits) and good title to all personal property, in each case that is
purported to be owned or leased by it, including those reflected on the most
recent Financial Statements delivered by Holdings hereunder, and none of such
properties and assets is subject to any Lien, except Liens permitted under
Section 8.2 (Liens, Etc.). Each ▇▇▇▇▇▇ Entity has received all deeds,
assignments, waivers, consents, non-disturbance and recognition or similar
agreements, bills of sale and other documents, and have duly effected all
recordings, filings and other actions necessary to establish, protect and
perfect such ▇▇▇▇▇▇ Entity's right, title and interest in and to all such
material owned Real Property and, with respect to all other owned and leased
real Property, to the extent required for the conduct of its business as
presently conducted.
(b) Schedule 4.22(b) (Owned Real Property) lists substantially and in
all material respects as of the Closing Date all Real Property (including
surface rights and coal and other mineral rights) owned by any ▇▇▇▇▇▇ Entity.
(c) Schedule 4.22(c) (Mining Leases and Prep Plant Leases) lists
substantially all and in all material respects as of the Closing Date (i) all
Leases for material Real Property, including all Prep Plant Leases and Mining
Leases, and (ii) the lessee and the lessor of each such Lease.
(d) Schedule 4.22(d) (Mines) sets forth a complete and accurate list
of all Mines (including addresses and the owner and operator thereof) owned or
operated by any Loan
70
Party as of the Closing Date and indicates whether each such Mine is owned or
leased by such ▇▇▇▇▇▇ Entity.
(e) Schedule 4.22(e) (Fixture Filing Locations) sets forth the county
and state in which the properties are located for which a Mortgage or fixture
filing has been granted to the Administrative Agent for the benefit of the
Secured Parties.
(f) Other than as permitted pursuant to Section 8.4 (Sale of Assets)
and Section 8.3 (Investments), no ▇▇▇▇▇▇ Entity owns or holds, or is obligated
under or a party to, any option, right of first refusal or other contractual
right to purchase, acquire, sell, assign, or dispose of any Real Property of
such ▇▇▇▇▇▇ Entity in respect of Real Property that in the aggregate has a fair
market value of greater than $10,000,000.
(g) No portion of any Real Property owned or leased by any ▇▇▇▇▇▇
Entity has suffered any material damage by fire, explosion, accident, drought,
storm, hail, earthquake, embargo, act of God or of the public enemy or other
casualty loss (whether or not covered by insurance) and no business of any
▇▇▇▇▇▇ Entity has been affected by any such casualty loss which could reasonably
be expected to have a Material Adverse Effect.
(h) No portion of any building or structure located on the surface of
any Real Property owned by any ▇▇▇▇▇▇ Entity is located in a special flood
hazard area as designated by any federal Governmental Authority except in such
instance where the ▇▇▇▇▇▇ Entity is fully insured for such risk by flood
insurance.
(i) With respect to each Mining Lease and each Prep Plant Lease, the
applicable ▇▇▇▇▇▇ Entity possesses the leasehold interest(s) mining rights and
Mining Permits necessary for the operation of the applicable Mine(s) currently
being operated on such parcel, and each of its rights under the applicable
lease(s), contracts, rights-of-way and easements necessary for the operation of
such Mine(s) is in full force and effect and no default exists thereunder,
except to the extent that such defaults or the failure to maintain such
lease(s), mining rights, Mining Permits, contracts, rights of way and easements
in full force and effect does not and will not have a material adverse effect on
the operation and intended use of such parcel by such ▇▇▇▇▇▇ Entity.
(j) No ▇▇▇▇▇▇ Entity has received any notice, or has any knowledge, of
any pending, threatened or contemplated condemnation proceeding affecting any
Real Property owned or leased by any ▇▇▇▇▇▇ Entity or any part thereof, except
those that, in the aggregate, would not have a Material Adverse Effect.
(k) The value of all vehicles, rolling stock and other operating
equipment owned by the Loan Parties as of the Closing Date and covered by
certificates of title is not, in the aggregate, material to the Loan Parties,
taken as a whole.
ARTICLE V
Financial Covenants
Each of Holdings and the Borrower agrees with the Lenders and the
Administrative Agent to each of the following as long as any Obligation or any
Commitment remains outstanding and, in each case, unless the Requisite Lenders
otherwise consent in writing:
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Section 5.1 Maximum Leverage Ratio
Holdings shall maintain, on the last day of each Fiscal Quarter set
forth below, a Leverage Ratio of not more than the maximum ratio set forth below
opposite such Fiscal Quarter:
----------------------------------------------------------------------
Fiscal Quarter Ending Maximum Leverage Ratio
----------------------------------------------------------------------
Each Fiscal Quarter ending on or prior to
December 31, 2004 4.25 to 1
----------------------------------------------------------------------
Each Fiscal Quarter ending after December 31,
2004 and on or prior to December 31, 2006 4.00 to 1
----------------------------------------------------------------------
Each Fiscal Quarter ending after December 31,
2006 and on or prior to December 31, 2007 3.75 to 1
----------------------------------------------------------------------
Each Fiscal Quarter ending after December 31,
2007 3.50 to 1
----------------------------------------------------------------------
Section 5.2 Maximum Secured Leverage Ratio
Holdings shall maintain, on the last day of each Fiscal Quarter set forth below,
a Secured Leverage Ratio of not more than the maximum ratio set forth below
opposite such Fiscal Quarter:
----------------------------------------------------------------------
Fiscal Quarter Ending Maximum Leverage Ratio
----------------------------------------------------------------------
Each Fiscal Quarter on or prior to December
31, 2003 2.25 to 1
----------------------------------------------------------------------
Each Fiscal Quarter ending after December
31, 2003 2.00 to 1
----------------------------------------------------------------------
Section 5.3 Minimum Interest Coverage Ratio
Holdings shall maintain an Interest Coverage Ratio of not less than
3.25 to 1, as determined as of the last day of each Fiscal Quarter ending after
the Closing Date, for the four Fiscal Quarters ending on such day.
Section 5.4 Capital Expenditures
(a) The ▇▇▇▇▇▇ Entities shall not make or incur, or permit to be made
or incurred, Capital Expenditures during each of the Fiscal Years set forth
below to be, in the aggregate, in excess of the maximum amount set forth below
for such Fiscal Year:
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------------------------------
Maximum Capital
Fiscal Year Expenditures
------------------------------
2003 $140,000,000
------------------------------
2004 $135,000,000
------------------------------
2005 $150,000,000
------------------------------
2006 $135,000,000
------------------------------
2007 $125,000,000
------------------------------
2008 $125,000,000;
------------------------------
provided, however, that to the extent that actual Capital Expenditures for any
such Fiscal Year shall be less than the maximum amount set forth above for such
Fiscal Year (without giving effect to the carryover permitted by this proviso),
the difference between said stated maximum amount and such actual Capital
Expenditures shall, in addition, be available for Capital Expenditures in the
next succeeding Fiscal Year.
(b) Notwithstanding clause (a) above, the ▇▇▇▇▇▇ Entities may make
additional Capital Expenditures with respect to Coal Handling Facilities in an
aggregate maximum amount not to exceed (i) $25,000,000 prior to the second
anniversary of the Closing Date and (i) $40,000,000 in the aggregate during the
term of the Facilities.
(c) Additions to property, plant and equipment recorded upon the
consummation of a Permitted Acquisition shall not be included for purposes of
calculating compliance with clause (a) above to the extent that any
consideration therefor is included as part of the consideration for such
Permitted Acquisition.
ARTICLE VI
Reporting Covenants
Each of the Borrower and Holdings agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding and, in each case, unless the Requisite Lenders
otherwise consent in writing:
Section 6.1 Financial Statements
The Borrower shall furnish to the Administrative Agent one electronic
copy (with sufficient paper copies for each Lender requesting same) of each of
the following:
(a) Quarterly Reports. Within 55 days after the end of each of the
first three Fiscal Quarters of each Fiscal Year, financial information regarding
Holdings and its Subsidiaries consisting of Consolidated unaudited balance
sheets as of the close of such quarter and the related statements of income and
cash flow for such quarter and that portion of the Fiscal Year ending as of the
close of such quarter, setting forth in comparative form the figures for the
corresponding
73
period in the prior Fiscal Year, in each case certified by a Responsible Officer
of Holdings as fairly presenting the Consolidated financial position of Holdings
and its Subsidiaries as at the dates indicated and the results of their
operations and cash flow for the periods indicated in accordance with GAAP
(subject to the absence of footnote disclosure and normal year-end audit
adjustments).
(b) Annual Reports. Within 100 days after the end of each Fiscal Year,
financial information regarding Holdings and its Subsidiaries consisting of
Consolidated balance sheets of Holdings and its Subsidiaries as of the end of
such year and related statements of income and cash flows of Holdings and its
Subsidiaries for such Fiscal Year, all prepared in conformity with GAAP, and
setting forth in comparative form the figures for the corresponding Fiscal Year
and the figures contained in the Projections or, if applicable, the latest
business plan provided pursuant to clause (e) below for such Fiscal Year, in
each case certified, in the case of such Consolidated Financial Statements,
without qualification as to the scope of the audit or as to the Borrower being a
going concern by Holdings' Accountants, together with the report of such
accounting firm stating that (i) such Financial Statements fairly present the
Consolidated financial position of Holdings and its Subsidiaries as at the dates
indicated and the results of their operations and cash flow for the periods
indicated in conformity with GAAP applied on a basis consistent with prior years
(except for changes with which the Holdings' Accountants shall concur and that
shall have been disclosed in the notes to the Financial Statements) and (ii) the
examination by the Holdings' Accountants in connection with such Consolidated
Financial Statements has been made in accordance with generally accepted
auditing standards, and accompanied by a certificate stating that in the course
of the regular audit of the business of Holdings and its Subsidiaries such
accounting firm has obtained no knowledge that a Default or Event of Default in
respect of the financial covenants contained in Article V (Financial Covenants)
has occurred and is continuing, or, if in the opinion of such accounting firm, a
Default or Event of Default has occurred and is continuing in respect of such
financial covenants, a statement as to the nature thereof.
(c) Compliance Certificate. Together with each delivery of any
financial statement pursuant to clause (a) or (b) above, a certificate of a
Responsible Officer of Holdings (each, a "Compliance Certificate") (i) showing
in reasonable detail the calculations used in determining the Leverage Ratio
(for purposes of determining the Applicable Margin) and demonstrating compliance
with each of the financial covenants contained in Article V (Financial
Covenants) that is tested on a quarterly basis and (ii) stating that no Default
or Event of Default has occurred and is continuing or, if a Default or an Event
of Default has occurred and is continuing, stating the nature thereof and the
action that Holdings or the Borrower (or another ▇▇▇▇▇▇ Entity) proposes to take
with respect thereto.
(d) Corporate Chart and Other Collateral Updates. Together with each
delivery of any Financial Statement pursuant to clause (a) or (b) above, (i) a
certificate of a Responsible Officer of Holdings certifying that the Corporate
Chart attached thereto (or the last Corporate Chart delivered pursuant to this
clause (d)) is true, correct, complete and current as of the date of such
Financial Statement and (ii) a certificate of a Responsible Officer of Holdings
in form and substance satisfactory to the Administrative Agent certifying that
all certificates, statements, updates and other documents (including updated
schedules) required to be delivered pursuant to the Pledge and Security
Agreement by any Loan Party in the preceding Fiscal Quarter have been delivered
thereunder (or such delivery requirement was otherwise duly waived or extended).
The reporting requirements set forth in this clause (d) are in addition to, and
are not
74
intended to and shall not replace or otherwise modify, any obligation of any
Loan Party under any Loan Document (including other notice or reporting
requirements). Compliance with the reporting obligations in this clause (d)
shall only provide notice to the Administrative Agent and shall not, by itself,
modify any obligation of any Loan Party under any Loan Document, update any
Schedule to this Agreement or any schedule to any other Loan Document or cure,
or otherwise modify in any way, any failure to comply with any covenant, or any
breach of any representation or warranty, contained in any Loan Document or any
other Default or Event of Default.
(e) Business Plan. Not later than 30 days before the end of each
Fiscal Year, and containing substantially the types of financial information
contained in the Projections, (i) the annual business and financial plans of
Holdings for the next succeeding Fiscal Year approved by the Board of Directors
of Holdings, and (ii) forecasts prepared by management of Holdings for each of
the succeeding Fiscal Years through the Fiscal Year in which the Term Loan
Maturity Date is scheduled to occur, including (x) a projected year-end
Consolidated balance sheet and income statement and statement of cash flows and
(y) a statement of all of the material assumptions on which such forecasts are
based.
(f) Management Letters, Etc. Within five Business Days after receipt
thereof by any Loan Party, copies of each management letter, exception report or
similar letter or report received by such Loan Party from its independent
certified public accountants (including the Holdings' Accountants).
Section 6.2 Default Notices
As soon as practicable, and in any event within five Business Days
after a Responsible Officer of any Loan Party has actual knowledge of the
existence of any Default, Event of Default or other event having had a Material
Adverse Effect or having any reasonable likelihood of causing or resulting in a
Material Adverse Change, Holdings shall give the Administrative Agent notice
specifying the nature of such Default or Event of Default or other event,
including the anticipated effect thereof, which notice, if given by telephone,
shall be promptly confirmed in writing on the next Business Day.
Section 6.3 Litigation
Promptly after any Responsible Officer of Holdings or the Borrower has
knowledge thereof, Holdings shall give the Administrative Agent written notice
of the commencement of each action, suit and proceeding before any domestic or
foreign Governmental Authority or arbitrator, affecting Holdings or any of its
Subsidiaries that (i) seeks injunctive or similar relief that, if granted, would
have a Material Adverse Effect or (ii) alone or together with each other action,
suit and proceeding arising from any single event or series of related events,
in the reasonable judgment of Holdings or such Subsidiary, exposes Holdings or
such Subsidiary to liability in an amount in excess of $5,000,000.
Section 6.4 Asset Sales
Prior to any Asset Sale anticipated to generate in excess of
$10,000,000 in Net Cash Proceeds, Holdings shall send the Administrative Agent a
notice (a) describing such Asset Sale or the nature and material terms and
conditions of such transaction and (b) stating the estimated Net Cash Proceeds
anticipated to be received by Holdings or any of its Subsidiaries.
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Section 6.5 SEC Filings; Press Releases
Promptly after the sending or filing thereof, Holdings shall send the
Administrative Agent one electronic copy (with sufficient paper copies for each
Lender requesting the same) of (a) all reports that Holdings sends to its
security holders generally, (b) all reports and registration statements (other
than the exhibits thereto and any registration statements on Form S-8 or its
equivalent) that Holdings or any of its Subsidiaries files with the Securities
and Exchange Commission or any national or foreign securities exchange or the
National Association of Securities Dealers, Inc., (c) all press releases and (d)
all other statements concerning material changes or developments in the business
of such Loan Party made available by any Loan Party to the public or any other
creditor.
Section 6.6 Labor Relations
Promptly after becoming aware of the same, Holdings shall give the
Administrative Agent written notice of (a) any material labor dispute to which
Holdings or any of its Subsidiaries is or may become a party, including any
strikes, lockouts or other disputes relating to any of such Person's plants and
other facilities, and (b) any material Worker Adjustment and Retraining
Notification Act or related material liability incurred with respect to the
closing of any plant or other facility of any such Person.
Section 6.7 Tax Returns
Upon the request of the Administrative Agent, Holdings shall provide
access to all federal, state, or local tax returns and reports filed by Holdings
or any of its Subsidiaries in respect of taxes measured by income (excluding
sales, use and like taxes).
Section 6.8 Insurance
As soon as is practicable and in any event within 100 days after the
end of each Fiscal Year, Holdings shall furnish the Administrative Agent with an
insurance broker's statement that all premiums then due and payable with respect
to all insurance coverage then maintained under Section 7.5 (Maintenance of
Insurance) have been paid and confirming that the Administrative Agent has been
named as loss payee or additional insured, as applicable, on any casualty or
general liability insurance.
Section 6.9 ERISA Matters
Holdings shall furnish the Administrative Agent (with sufficient
copies for each of the Lenders) each of the following:
(a) promptly and in any event within 30 days after Holdings, any of
its Subsidiaries or any ERISA Affiliate knows or has reason to know that any
material ERISA Event has occurred, a written statement of a Responsible Officer
of Holdings describing such ERISA Event or waiver request and the action, if
any, Holdings, its Subsidiaries and ERISA Affiliates propose to take with
respect thereto and a copy of any notice filed with the PBGC or the IRS
pertaining thereto;
(b) promptly and in any event within 10 days after Holdings, any of
its Subsidiaries or any ERISA Affiliate knows or has reason to know that a
request for a minimum
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funding waiver under Section 412 of the Code has been filed with respect to any
Title IV Plan or Multiemployer Plan, a written statement of a Responsible
Officer of Holdings describing such waiver request and the action, if any,
Holdings, its Subsidiaries and ERISA Affiliates propose to take with respect
thereto and a copy of any notice filed with the PBGC or the IRS pertaining
thereto; and
(c) simultaneously with the date that Holdings, any of its
Subsidiaries or any ERISA Affiliate files a notice of intent to terminate any
Title IV Plan, if such termination would require material additional
contributions in order to be considered a standard termination within the
meaning of Section 4041(b) of ERISA, a copy of each notice.
Section 6.10 Environmental Matters
Holdings shall provide written notice to the Administrative Agent
promptly after any Responsible Officer of Holdings or any of its Subsidiaries
learns of any of the following:
(a) that any Loan Party is or may be liable to any Person as a result
of a Release or threatened Release that could reasonably be expected to subject
such Loan Party to Environmental Liabilities and Costs of $2,500,000 or more
individually or $10,000,000 in the aggregate in any Fiscal Year;
(b) the receipt by any Loan Party of notification that a Governmental
Authority is reasonably likely to take action that will subject any real or
personal property of such Loan Party to an Environmental Lien;
(c) the receipt by any Loan Party of any notice of violation of or
potential liability under, or knowledge by such Loan Party that there exists a
condition or conditions that could reasonably be expected to result in a
violation of or liability under, any Environmental Law, where the consequences
of the violations and liabilities would reasonably be expected to subject such
Loan Party to Environmental Liabilities and Costs of $2,500,000 or more
individually or $10,000,000 in the aggregate in any Fiscal Year;
(d) the commencement of any judicial or administrative proceeding or
investigation against any Loan Party alleging a violation of or liability under
any Environmental Law, that, if adversely determined, would have a reasonable
likelihood of subjecting such Loan Party to Environmental Liabilities and Costs
of $2,500,000 or more individually or $10,000,000 in the aggregate in any Fiscal
Year;
(e) any proposed acquisition of stock, assets or real estate, any
proposed leasing of property or any other action by any Loan Party or any of its
Subsidiaries other than those the consequences of which, in the aggregate, have
reasonable likelihood of subjecting the Loan Parties collectively to
Environmental Liabilities and Costs of $2,500,000 or less;
(f) any proposed action by any Loan Party or any change in
Environmental Laws that has a reasonable likelihood of requiring the Loan Party
to obtain additional Permits required by Environmental Laws or make additional
capital improvements to assure compliance with Environmental Laws that, in the
aggregate, would cost $5,000,000 or more or subject such Loan Party to
Environmental Liabilities and Costs of $5,000,000 or more individually;
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(g) the commencement of any judicial proceeding against any Loan
Party, arising out of or related to asserted criminal violations of
Environmental Law; and
(h) upon written request by any Lender through the Administrative
Agent, a report providing an update of the status of any environmental, health
or safety compliance, hazard or liability issue identified in any notice or
report delivered pursuant to this Agreement. Notwithstanding the foregoing, on a
quarterly basis, Holdings shall provide Administrative Agent with a status
report regarding any pending litigation or investigation arising out of or
related to the release of coal slurry at the ▇▇▇▇▇▇ County Site and any criminal
investigation or proceeding associated with any criminal violation of
Environmental Laws.
Section 6.11 Customer Contracts
Promptly after any Responsible Officer of Holdings or the Borrower has
knowledge of the same, the Borrower shall give the Administrative Agent prior to
the Closing Date written notice of any cancellation, termination or loss of any
material Contractual Obligation, Coal Supply Agreement, Mining Lease or Prep
Plant Lease of any ▇▇▇▇▇▇ Entity.
Section 6.12 Other Information
Holdings and the Borrower shall provide the Administrative Agent or
any Lender with such other information respecting the business, properties,
condition, financial or otherwise, or operations of Holdings or any of its
Subsidiaries as the Administrative Agent or such Lender through the
Administrative Agent may from time to time reasonably request.
ARTICLE VII
Affirmative Covenants
Each of Holdings and the Borrower agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding and, in each case, unless the Requisite Lenders
otherwise consent in writing:
Section 7.1 Preservation of Corporate Existence, Etc.
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to, preserve and maintain its legal existence, rights
(charter and statutory) and franchises, except (a) that any ▇▇▇▇▇▇ Entity which
is inactive or dormant (meaning that on the date of determination and on a
consolidated basis with its Subsidiaries, it has assets with an aggregate Fair
Market Value of less than $100,000) may be dissolved, provided that if such
▇▇▇▇▇▇ Entity is a Loan Party, all assets distributed upon dissolution shall be
distributed to another Loan Party or (b) as permitted by Sections 8.3
(Investments), 8.4 (Sale of Assets) and Section 8.7 (Restriction on Fundamental
Changes; Permitted Acquisitions).
Section 7.2 Compliance with Laws, Etc.
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to:
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(a) comply with all applicable Requirements of Law (including Mining
Laws), Contractual Obligations and Permits (including Mining Permits), except
where the failure so to comply would not, in the aggregate, have a Material
Adverse Effect; and
(b) to the extent required by GAAP, maintain adequate reserves for (i)
future costs associated with any lung disease claim alleging pneumoconiosis or
silicosis or arising out of exposure or alleged exposure to coal dust or the
coal mining environment, (ii) future costs associated with retiree and health
care benefits, (iii) future costs associated with reclamation of disturbed
acreage, removal of facilities and other closing costs in connection with its
mining operations and (iv) future costs associated with other potential
environmental liabilities.
Section 7.3 Conduct of Business
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to, (a) conduct its business in the ordinary course and
consistent with past practice, and (b) use its reasonable efforts, in the
ordinary course and consistent with past practice, to preserve its business and
the goodwill and business of the customers, advertisers, suppliers and others
having business relations with any ▇▇▇▇▇▇ Entity, except in each case where the
failure to comply with the covenants in each of clauses (a) and (b) above would
not, in the aggregate, have a Material Adverse Effect.
Section 7.4 Payment of Taxes, Etc.
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to, pay and discharge before the same shall become
delinquent, all lawful governmental claims, taxes, assessments, charges and
levies, except amounts which in the aggregate do not exceed $500,000 at any time
or where contested in good faith, by proper proceedings and adequate reserves
therefor are established on the books of Holdings or the appropriate Subsidiary
in conformity with GAAP.
Section 7.5 Maintenance of Insurance
Each of Holdings and the Borrower shall (a) maintain for, itself, and
cause to be maintained for each of its Subsidiaries, the insurance with
responsible and reputable insurance companies or associations in such amounts
and covering such risks that Holdings and the Borrower deem necessary to provide
sufficient coverage for its businesses and which amounts and coverage shall not
be materially less than the amounts or coverage usually carried by companies
engaged in similar businesses and owning similar properties in the same general
areas in which such ▇▇▇▇▇▇ Entity operates, and such other insurance as may be
reasonably requested by the Administrative Agent (provided that any such request
is accompanied by an insurance broker's statement that such insurance is
available at commercially reasonable rates), and, in any event, all insurance
required by any Collateral Documents and (b) cause any casualty or general
liability insurance to name the Administrative Agent on behalf of the Secured
Parties as additional insured or loss payee, as appropriate, and to provide that
no cancellation, material addition in amount or material change in coverage
shall be effective until after 30 days' written notice thereof to the
Administrative Agent.
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Section 7.6 Access
(a) Holdings and the Borrower shall from time to time permit the
Administrative Agent and the Lenders, or any agents or representatives thereof,
within two Business Days after written notification of the same during normal
business hours (except that during the continuance of an Event of Default, no
such notice shall be required) to (a) examine and make copies of and abstracts
from the records and books of account of any ▇▇▇▇▇▇ Entity, (b) visit the
properties of any ▇▇▇▇▇▇ Entity and (c) discuss the affairs, finances and
accounts of any ▇▇▇▇▇▇ Entity with any of its Responsible Officers or directors.
(b) All primary and basic exploration data and information pertaining
to the Mines, together with all other reserve reports and maps, analysis and,
upon reasonable notice, engineering and operating data and similar information
pertaining to the Mines being operated by any ▇▇▇▇▇▇ Entity shall be available
at all reasonable times for inspection and review by authorized representatives
of the Administrative Agent except to the extent (i) any such access is
restricted by a Requirement of Law or (ii) any such data, information or the
like are subject to a written confidentiality agreement with a non-Affiliate
that prohibits any ▇▇▇▇▇▇ Entity from granting such access to the Lenders;
provided that a Responsible Officer of Holdings is made available to such Lender
to discuss such confidential information to the extent permitted.
Section 7.7 Keeping of Books
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to (a) keep, proper books of record and account, in
which full and correct entries shall be made in conformity with GAAP of all
financial transactions and the assets and business of such ▇▇▇▇▇▇ Entity, and
(b) preserve all primary and basic exploration data and information pertaining
to the Mines will be preserved where reasonable in accordance with customary
industry practice and in a sound and careful manner for future use and review.
Section 7.8 Maintenance of Properties, Etc.
(a) Each of Holdings and the Borrower shall, and shall cause each of
their respective Subsidiaries to, maintain (a) in good working order and
condition (ordinary wear and tear and damage from casualty and condemnation
excepted) all of its properties necessary in the conduct of its business, (b)
all rights, Permits, licenses, approvals and privileges (including all Mining
Permits) used or useful or necessary in the conduct of its business as then
being conducted, (c) all registered patents, trademarks, trade names, copyrights
and service marks with respect to its business as then being conducted, and (d)
Coal reserves, or the rights to acquire coal from third parties, sufficient to
fulfill its requirements under its Coal Supply Agreements, except where failure
to so maintain the items set forth in clauses (a), (b), or (c) above would not,
in the aggregate, have a Material Adverse Effect.
(b) Each of Holdings and the Borrower shall, and shall cause each of
their respective Subsidiaries to, cause each Mine being operated by a ▇▇▇▇▇▇
Entity to be operated, maintained, developed and mined and cause the associated
processing plants and other fixed and operating assets to be operated and
maintained, in a workmanlike manner, as would a prudent coal mine operator, and
in accordance with generally accepted mining practices and all applicable
Requirements of Law, including but not limited to applicable Mining Laws and
Environmental Laws, except where the failure to do so would not reasonably be
expected to have a Material Adverse Effect.
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Section 7.9 Material Contracts
Each of Holdings and the Borrower shall, and shall cause each of their
Subsidiaries to:
(a) at all times comply fully with all of the terms and conditions of
its material Contractual Obligations, including, Coal Supply Agreements, the
nonperformance with which would reasonably be expected to have a Material
Adverse Effect and, to the extent practicable, perform any and all actions
necessary to maintain all Coal Supply Agreements material to its business in
full force and effect;
(b) keep in full force and effect all of its Mining Leases, Prep Plant
Leases and other contract rights, and all rights of way, easements and
privileges necessary or appropriate for the proper operation of the Mines being
operated by any ▇▇▇▇▇▇ Entity to the extent the failure to do so would
reasonably be expected to have a Material Adverse Effect; and
(c) use commercially reasonable efforts (to the extent practicable,
provided that in no circumstance shall Holdings or any Subsidiary be required to
incur any additional cost or impair any existing or potential business
relationship) to ensure that each Mining Lease, each Prep Plant Lease and each
Coal Supply Agreement entered into after the Effective Date does not prohibit
the assignability thereof to the Administrative Agent for the benefit of the
Secured Parties without the consent of any other party.
Section 7.10 Application of Proceeds
The Borrower (and, to the extent distributed to them, each ▇▇▇▇▇▇
Entity) shall use the entire amount of the proceeds of the Loans as provided in
Section 4.13 (Use of Proceeds).
Section 7.11 Environmental
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to, comply in all material respects with Environmental
Laws. Without limiting the foregoing, the Borrower shall, at its sole cost and
expense, upon receipt of any notification or otherwise obtaining knowledge of
any Release or other event that has any reasonable likelihood of the ▇▇▇▇▇▇
Entities incurring Environmental Liabilities and Costs undertake such Remedial
Action as required by Environmental Laws or as any Governmental Authority
requires to address the Release or event and otherwise ensure compliance with
Environmental Laws. Borrower shall not be in breach of this Section 7.11 unless
the Environmental Liabilities and Costs exceed $2,5000,000 individually or
$10,000,000 in the aggregate in any Fiscal Year.
Section 7.12 Mining
Each of Holdings and the Borrower shall, and shall cause each of their
respective Subsidiaries to:
(a) take all commercially reasonable efforts to ensure that all of its
tenants, subtenants, contractors, subcontractors, and invitees comply in all
material respects with all applicable Mining Laws, and obtain, comply in all
respects with and maintain any and all material Mining Permits, applicable to
any of them; and
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(b) conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions in each case required under
applicable Mining Laws and promptly comply in all respects with all lawful
orders and directives of all Governmental Authorities regarding applicable
Mining Laws except to the extent that the same are being contested in good faith
by appropriate proceedings and the pendency of such proceedings would not be
reasonably expected to have a Material Adverse Effect.
Section 7.13 Real Property
(a) Each of Holdings and the Borrower shall, and shall cause each of
their respective Subsidiaries to, (i) comply in all material respects with all
of their respective obligations under all of their respective Mining Leases and
Prep Plant Leases now or hereafter held respectively by them, (ii) not modify,
amend, cancel, extend or otherwise change in any materially adverse manner any
term, covenant or condition of any Material Mortgaged Lease, (iii) not assign or
sublet any Lease if such assignment or sublet would have a Material Adverse
Effect, (iv) provide the Administrative Agent with a copy of each notice of
default under any Material Mortgaged Lease received by a ▇▇▇▇▇▇ Entity
immediately upon receipt thereof and deliver to the Administrative Agent a copy
of each notice of default sent by a ▇▇▇▇▇▇ Entity under any Material Mortgaged
Lease simultaneously with its delivery of such notice under such Lease and (v)
notify the Administrative Agent at least 14 days prior to the date a ▇▇▇▇▇▇
Entity takes possession of, or becomes liable under, any new material Mining
Lease or Prep Plant Lease, whichever is earlier.
(b) Within 15 Business Days after (i) entering into any Mining Lease,
Prep Plant Lease or any other Lease (other than a renewal of an existing Lease)
in which the Dollar Equivalent of the annual rental or royalty payments are
anticipated to equal or exceed $1,000,000 or (ii) acquiring any owned Real
Property with a fair market value in excess of $1,000,000 Holdings and the
Borrower shall, and shall cause each other Loan Party to, provide the
Administrative Agent written notice thereof (subject, however, to the provisions
of clause (c)(ii) below).
(c) In each case, to the extent not previously delivered to the
Administrative Agent, upon written request of the Administrative Agent, Holdings
and the Borrower shall, and shall cause each Subsidiary Guarantor to, execute
and deliver to the Administrative Agent, for the benefit of the Secured Parties,
promptly and in any event not later than 45 days after receipt of such notice
(or, if such notice is given by the Administrative Agent prior to the
acquisition of such Real Property or Lease, contemporaneously with the
consummation of such acquisition):
(i) a Mortgage on all owned Real Property of such Loan Party; and
(ii) a Mortgage on any Mining Lease or Prep Plant Lease for which
the annual rental or royalty payments are anticipated to equal or exceed
$2,000,000; provided, however, that once the aggregate value of all Mining
Leases and Prep Plant Leases excepted from the application of this clause
(ii) exceeds $10,000,000, the Loan Parties shall provide a Mortgage on any
Mining Lease or Prep Plant Lease thereafter entered into for which the
annual rental or royalty payments are anticipated to equal or exceed
$1,000,000;
(d) Each Mortgage provided pursuant to clause (c) above shall be
delivered to the Administrative Agent together with (A) if requested by the
Administrative Agent and such
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Real Property is located in the United States, such Lease is subject to the laws
of the United States (including any state thereof) or is a Lease of Real
Property located in the United States, all Mortgage Supporting Documents
relating thereto or (B) otherwise, documents similar to Mortgage Supporting
Documents deemed by the Administrative Agent to be appropriate in the applicable
jurisdiction to obtain the equivalent in such jurisdiction of a first-priority
mortgage on such Real Property or Lease. Each Mortgage on a Mining Lease or Prep
Plant Lease shall contain the language described in Section 3.1(a)(iv)
(Conditions Precedent to Initial Loans and Letters of Credit) regarding the
applicable lessor's consent to such Mortgage.
(e) With respect to all Mining Leases and Prep Plant Leases for which
landlord consents to leasehold Mortgages have been obtained after the recording
of the applicable Deed of Trust and for which a memorandum of lease has not
already been recorded prior thereto, Holdings shall, or shall cause the
applicable Loan Party, to cause the respective landlord to execute such
memorandum of lease and have such memorandum of lease, together with a Deed of
Trust, recorded as a first priority lien.
Section 7.14 Bailee's Letters
At any time that any Loan Party has coal valued at in excess of
$1,000,000 stored on any third party's premises, Holdings and the Borrower
shall, and shall cause the applicable Loan Party to use commercially reasonable
efforts to deliver a Bailee Letter, as applicable, with respect thereto.
Section 7.15 Approved Deposit Accounts; Control Accounts
(a) Each of Holdings and the Borrower shall, and shall cause each of
their respective Subsidiaries (other than Subsidiaries that are Permitted Joint
Ventures) to, (i) deposit in an Approved Deposit Account all cash they receive,
(ii) not establish or maintain any Securities Account that is not a Control
Account and (iii) not establish or maintain any Deposit Account other than with
a Deposit Account Bank; provided, however, that the Loan Parties may (i)
maintain payroll, withholding tax, employee benefit and other fiduciary
accounts, (ii) maintain accounts with the Administrative Agent, (iii) maintain
other accounts as long as the aggregate average daily balance in all such
accounts for a 30 day period does not exceed $1,000,000, (iv) maintain other
accounts that are automatically (without further instruction) swept no less
frequently than once each week into an Approved Deposit Account and (v) maintain
cash or Cash Equivalents constituting Letter of Credit Support Obligations in
other Deposit Accounts or Securities Accounts to the extent permitted pursuant
to Section 8.2(f) (Liens Etc.).
(b) Subject to the terms of the Securitization Intercreditor
Agreement, each of Holdings and the Borrower shall, and shall cause each of
their respective Subsidiaries (other than Subsidiaries that are Permitted Joint
Ventures), to (i) instruct each Account Debtor or other Person obligated to make
a payment to any of them under any Account or General Intangible to make
payment, or to continue to make payment, to an Approved Deposit Account and (ii)
deposit in an Approved Deposit Account immediately upon receipt all Proceeds of
such Accounts and General Intangibles received by Holdings, the Borrower or any
of their Subsidiaries from any other Person.
(c) Subject to the terms of the Securitization Intercreditor
Agreement, in the event (i) Holdings, the Borrower, any Subsidiary of Holdings
(other than Subsidiaries that are Permitted Joint Ventures) or any Deposit
Account Bank shall, after the date hereof, terminate an
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agreement with respect to the maintenance of an Approved Deposit Account for any
reason, (ii) the Administrative Agent shall demand such termination as a result
of the failure of a Deposit Account Bank to comply with the terms of the
applicable Deposit Account Control Agreement or (iii) the Administrative Agent
determines in its sole discretion that the financial condition of a Deposit
Account Bank has materially deteriorated, each of Holdings and the Borrower
shall, and shall cause each Subsidiary of Holdings to, notify all of their
respective obligors that were making payments to such terminated Approved
Deposit Account to make all future payments to another Approved Deposit Account.
(d) In the event (i) any Loan Party or any Approved Securities
Intermediary shall, after the date hereof, terminate an agreement with respect
to the maintenance of a Control Account for any reason, (ii) the Administrative
Agent shall demand such termination as a result of the failure of an Approved
Securities Intermediary to comply with the terms of the applicable Control
Account Agreement or (iii) the Administrative Agent determines in its sole
discretion that the financial condition of an Approved Securities Intermediary
has materially deteriorated, each of Holdings and the Borrower shall, and shall
cause each Subsidiary of Holdings to, notify all of its obligors that were
making payments to such terminated Control Account to make all future payments
to another Control Account.
(e) The Administrative Agent may establish one or more Cash Collateral
Accounts with such depositaries and Securities Intermediaries as it in its sole
discretion shall determine. Each of Holdings and the Borrower agrees that each
such Cash Collateral Account shall be under the control of the Administrative
Agent and that the Administrative Agent shall be the Entitlement Holder with
respect to each such Cash Collateral Account that is a Securities Account and
the only Person authorized to give Entitlement Orders with respect to each such
Securities Account. Without limiting the foregoing, funds on deposit in any Cash
Collateral Account may be invested (but the Administrative Agent shall be under
no obligation to make any such investment) in Cash Equivalents at the direction
of the Administrative Agent and, except during the continuance of an Event of
Default, the Administrative Agent agrees with the Borrower to issue Entitlement
Orders for such investments in Cash Equivalents as requested by the Borrower;
provided, however, that the Administrative Agent shall not have any
responsibility for, or bear any risk of loss of, any such investment or income
thereon. No ▇▇▇▇▇▇ Entity or Person claiming on behalf of or through a ▇▇▇▇▇▇
Entity shall have any right to demand payment of any funds held in any Cash
Collateral Account at any time prior to the termination of all outstanding
Letters of Credit and the payment in full of all then outstanding and payable
monetary Obligations. The Administrative Agent shall apply all funds on deposit
in a Cash Collateral Account as provided in Section 2.12(f) (Payments and
Computations).
Section 7.16 Additional Collateral and Guaranties
To the extent not delivered to the Administrative Agent on or before
the Closing Date (including in respect of after-acquired property and Persons
that become Wholly-Owned Subsidiaries of any Loan Party after the Closing Date),
each of Holdings and the Borrower agrees promptly to do, or cause each ▇▇▇▇▇▇
Entity (other than a Securitization Subsidiary) to do, each of the following,
unless otherwise agreed by the Administrative Agent:
(a) deliver to the Administrative Agent such duly-executed supplements
and amendments to the Guaranty (or, in the case of any Non-U.S. Subsidiary,
foreign guarantees and related documents), in each case in form and substance
reasonably satisfactory to the
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Administrative Agent and as the Administrative Agent deems necessary or
advisable in order to ensure that each Wholly-Owned Subsidiary of any ▇▇▇▇▇▇
Entity planning to enter or having entered into Guaranty Obligations of the
Indebtedness of any Loan Party guaranties, as primary obligor and not as surety,
the full and punctual payment when due of the Obligations or any part thereof;
provided, however, that, unless (x) the Borrower and the Administrative Agent
otherwise agree, (y) such Non U.S. Subsidiary has entered into Guaranty
Obligations in respect of other Indebtedness having substantially similar tax
consequences, or (z) such guaranty can be given without resulting in any
material adverse tax consequences for the ▇▇▇▇▇▇ Entities, taken as a whole
(including any Person that becomes a Loan Party as a result of such pledge or
grant), in no event shall any Non-U.S. Subsidiary be required to guaranty,
directly or indirectly, the payment of any of the Obligations;
(b) deliver to the Administrative Agent such duly-executed joinder and
amendments to the Pledge and Security Agreement and, if applicable, other
Collateral Documents (or, in the case of any such Non-U.S. Subsidiary or any
Domestic Subsidiary that holds shares in any Person that is a Non-U.S.
Subsidiary, foreign charges, pledges, security agreements and other Collateral
Documents), in each case in form and substance reasonably satisfactory to the
Administrative Agent and as the Administrative Agent deems necessary or
advisable in order to (i) effectively grant to the Administrative Agent, for the
benefit of the Secured Parties, a valid, perfected and enforceable
first-priority security interest (subject, other than in the case of Stock and
Stock Equivalents, to Liens permitted pursuant to Section 8.2 (Liens Etc.)) in
the Stock and Stock Equivalents and other debt Securities owned by any ▇▇▇▇▇▇
Entity planning to enter or having entered into Guaranty Obligations of the
Indebtedness of any Loan Party under the 6.95% Indenture or New Securities
Documents and (ii) effectively grant to the Administrative Agent, for the
benefit of the Secured Parties, a valid, perfected and enforceable
first-priority security interest in all property interests and other assets of
any ▇▇▇▇▇▇ Entity planning to enter or having entered into Guaranty Obligations
of the Indebtedness of any Loan Party under the 6.95% Indenture or New
Securities Documents; provided, however, that, unless (x) the Borrower and the
Administrative Agent otherwise agree or (y) such pledge or grant can be made
without resulting in any material adverse tax consequences for the ▇▇▇▇▇▇
Entities, taken as a whole (including any Person that becomes a Loan Party as a
result of such pledge or grant), in no event shall any Loan Party be required to
pledge (i) in excess of a total of 65% (or such lesser percentage as may be
specified under Treasury Regulation (S) 1.956-2(c), or any similar or successor
regulation or law, at the time such pledge is to be made) of the combined voting
power of all outstanding Voting Stock of any Non-U.S. Subsidiary, or (ii) unless
such Stock or Stock Equivalents is directly held by Holdings or a Domestic
Subsidiary thereof, any of the Stock or Stock Equivalents of any Non-U.S.
Subsidiary and no Non-U.S. Subsidiary shall be required to pledge any interest
in any of its real or personal property;
(c) deliver to the Administrative Agent all certificate, instruments
and other documents representing all Pledged Stock, Pledged Debt Instruments and
all other Stock, Stock Equivalents and other debt Securities being pledged
pursuant to the joinders, amendments and foreign agreements executed pursuant to
clause (b) above, together with (i) in the case of Pledged Certificated Stock
and other certificated Stock and Stock Equivalents, undated stock powers
endorsed in blank and (ii) in the case of Pledged Debt Instruments and other
certificated debt Securities, endorsed in blank, in each case executed and
delivered by a Responsible Officer of the applicable ▇▇▇▇▇▇ Entity;
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(d) to take such other actions necessary or advisable to ensure the
validity or continuing validity of the guaranties required to be given pursuant
to clause (a) above or to create, maintain or perfect the security interest
required to be granted pursuant to clause (b) above, including the filing of UCC
financing statements in such jurisdictions as may be required by the Collateral
Documents or by law or as may be reasonably requested by the Administrative
Agent;
(e) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Agent.
ARTICLE VIII
Negative Covenants
Each of Holdings and the Borrower agrees with the Lenders and the
Administrative Agent to each of the following, as long as any Obligation or any
Commitment remains outstanding and, in each case, unless the Requisite Lenders
otherwise consent in writing:
Section 8.1 Indebtedness
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, directly or indirectly create, incur, assume
or otherwise become or remain directly or indirectly liable with respect to any
Indebtedness except for the following:
(a) the Secured Obligations;
(b) Indebtedness existing on the date of this Agreement and disclosed
on Schedule 8.1 (Existing Indebtedness);
(c) the 6.95% Notes;
(d) the Convertible Notes;
(e) New Securities (to the extent they constitute Indebtedness);
provided, that the Net Cash Proceeds of such Indebtedness are applied to
permanently repay the 6.95% Notes and/or the Obligations in accordance with
Section 2.8(a) (Mandatory Prepayments);
(f) Indebtedness of a Securitization Subsidiary arising from a
Permitted Securitization and Guaranty Obligations incurred by Holdings in
connection with such Permitted Securitization;
(g) Guaranty Obligations and indemnities incurred by the Borrower or
any Guarantor in respect of Indebtedness of the Borrower or any Guarantor that
is permitted by this Section 8.1;
(h) Capital Lease Obligations and purchase money Indebtedness incurred
by the Borrower or a Subsidiary of the Borrower to finance the acquisition of
fixed assets; provided, however, that the Capital Expenditure related thereto is
otherwise permitted by Section 5.4
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(Capital Expenditures) and that the aggregate outstanding principal amount of
all such Capital Lease Obligations and purchase money Indebtedness shall not
exceed $10,000,000 at any time;
(i) Renewals, extensions, and refinancings of Indebtedness permitted
by clause (f) or (h) above or this clause (i); provided, however, that (A) any
such renewal, extension, or refinancing is in an aggregate principal amount not
greater than the principal amount of, and is on terms no less favorable to the
Borrower or such Subsidiary, including as to weighted average maturity, than the
Indebtedness being renewed, extended, refinanced or refunded; and (B) in the
case of any refinancing or refunding of a Securitization, such refinancing or
refunding meets the requirements of a Permitted Securitization as set forth in
the definition thereof;
(j) Indebtedness arising from intercompany loans to the extent such
Investment in the intercompany loan is permitted under Section 8.3 (Investments)
and ordinary course intercompany current liabilities incurred in connection with
cash management operations;
(k) Indebtedness of a ▇▇▇▇▇▇ Entity under a Hedging Contract not
prohibited by Section 8.7 (Speculative Transactions);
(l) Indebtedness of a Proposed Acquisition Target (other than a
Proposed Acquisition Target that is merged into any ▇▇▇▇▇▇ Entity); provided (i)
such Indebtedness was not incurred by the Proposed Acquisition Target in
contemplation of the acquisition thereof by a ▇▇▇▇▇▇ Entity, (ii) such
Indebtedness is Non-Recourse Indebtedness, (iii) all such Indebtedness does not
exceed $100,000,000 outstanding at any one time, (iv) not more than $25,000,000
of such Indebtedness is secured, and (v) the terms of such Indebtedness are
reasonably acceptable to the Agents;
(m) Indebtedness pursuant to letters of credit not issued under this
Agreement and used to support any obligations in respect of unemployment
insurance, black lung or other types of social security benefits, other
insurance or self insurance arrangements, reclamation, the performance of bids,
tenders, statutory obligations, sales, leases, contracts (other than for the
repayment of borrowed money) and surety, appeal, customs, performance or return
of money bonds and workers' compensation or other types of social security
benefits or to secure the performance of statutory obligations, surety, appeal
and other similar obligations up to an aggregate principal amount not to exceed
$150,000,000 at any time;
(n) Indebtedness arising under any performance, appeal or surety bond
or similar obligation entered into in the ordinary course of business or
pursuant to a Requirement of Law;
(o) a sale and leaseback transaction permitted pursuant to Section
8.16(b) (Operating Leases; Sale/Leasebacks), to the extent such transaction
would constitute Indebtedness; provided, that the Net Cash Proceeds of such
Indebtedness are applied to the Obligations in accordance with Section 2.8(a)
(Mandatory Prepayments); and
(p) unsecured Indebtedness not otherwise permitted under this Section
8.1; provided, however, that the aggregate outstanding principal amount of all
such unsecured Indebtedness shall not exceed $25,000,000 at any time.
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Section 8.2 Liens, Etc.
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, create or suffer to exist, any Lien upon or
with respect to any of their respective properties or assets, whether now owned
or hereafter acquired, or assign, or permit any of its Subsidiaries to assign,
any right to receive income, except for the following:
(a) Liens created pursuant to the Loan Documents;
(b) Liens existing on the date of this Agreement and disclosed on
Schedule 8.2 (Existing Liens);
(c) Customary Permitted Liens of any ▇▇▇▇▇▇ Entity;
(d) purchase money Liens granted by the Borrower or any Subsidiary of
the Borrower (including the interest of a lessor under a Capital Lease and
purchase money Liens to which any property is subject at the time, on or after
the date hereof, of the Borrower's or such Subsidiary's acquisition thereof)
securing Indebtedness permitted under Section 8.1(h) (Indebtedness) and limited
in each case to the property purchased with the proceeds of such purchase money
Indebtedness or subject to such Capital Lease;
(e) any Lien securing the renewal, extension, refinancing or refunding
of any Indebtedness secured by any Lien permitted by clause (d) above or this
clause (e) without any change in the assets subject to such Lien and to the
extent such renewal, extension, refinancing or refunding is permitted by Section
8.1 (Indebtedness);
(f) Liens on cash or Cash Equivalents (i) constituting Letter of
Credit Support to the extent required by the applicable issuers to be provided
to secure a ▇▇▇▇▇▇ Entity's obligations in respect of letters of credit
permitted to be issued pursuant to Section 8.1(m)(Indebtedness), up to an
aggregate amount not in excess of 105% of the face amount of such letters of
credit and (ii) supporting obligations of the ▇▇▇▇▇▇ Entities in respect of
unemployment insurance, black lung or other types of social security benefits,
other insurance or self insurance arrangements, reclamation, the performance of
bids, tenders, statutory obligations, sales, leases, contracts (other than for
the repayment of borrowed money) and surety, appeal, customs, performance or
return of money bonds and workers' compensation or other types of social
security benefits or to secure the performance of statutory obligations, surety,
appeal and other similar obligations; provided that the aggregate amount of all
cash or Cash Equivalents in respect of which Liens are granted under this clause
(f) shall not exceed $150,000,000 at any time;
(g) Liens on real or personal property of a Proposed Acquisition
Target in respect of Indebtedness permitted to be incurred pursuant to Section
8.1(l) (Indebtedness), up to an aggregate amount not in excess of $25,000,000;
(h) Liens on the assets of (A) one or more Securitization
Subsidiaries, which Liens are created or deemed to exist in connection with the
related Permitted Securitization (including any related filings or any financing
statements) and (B) any ▇▇▇▇▇▇ Entity which assets are contributed or
transferred by such ▇▇▇▇▇▇ Entity, as the originator thereof, to such
Securitization Subsidiary, which Liens are created or deemed to exist in
connection with the related Permitted Securitization (including any related
filings or any financing statements);
88
provided that the aggregate attributed principal amount secured by all such
Liens shall not exceed $100,000,000 at any time; and
(i) Liens in favor of lessors securing operating leases or, to the
extent such transactions create a Lien hereunder, sale and leaseback
transactions, in each case to the extent such operating leases or sale and
leaseback transactions are permitted pursuant to Section 8.16 (Operating Leases;
Sale/Leasebacks); and
(j) Liens in the nature of royalties, dedications of reserves under
Coal Supply Agreements or similar rights or interests granted, taken subject to,
or otherwise imposed on properties consistent with normal practices in the
mining industry; and
(k) Liens not otherwise permitted by the foregoing clauses of this
Section 8.2 securing obligations or other liabilities (other than Indebtedness)
of any ▇▇▇▇▇▇ Entity; provided, however, that the aggregate outstanding amount
of all such obligations and liabilities shall not exceed $5,000,000 at any time.
Section 8.3 Investments
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, directly or indirectly make or maintain any
Investment except for the following:
(a) Investments existing on the date of this Agreement and disclosed
on Schedule 8.3 (Existing Investments) and Investments made after the date
hereof solely to the extent financed using the proceeds of any return of
originally invested capital or principal to the ▇▇▇▇▇▇ Entities on the
Investment described as "Purchase of 25% interest in ▇▇▇▇▇▇▇ #1 gas well" or the
Investment described as "Investment in WACO Oil & Gas Company;"
(b) Investments in cash and Cash Equivalents held in a Deposit Account
or a Control Account with respect to which the Administrative Agent for the
benefit of the Secured Parties has a first priority perfected Lien;
(c) Investments in accounts, payment intangibles and chattel paper
(each as defined in the UCC), notes receivable and similar items arising or
acquired in the ordinary course of business consistent with the past practice of
Holdings and its Subsidiaries;
(d) Investments received in settlement of amounts due to any ▇▇▇▇▇▇
Entity effected in the ordinary course of business;
(e) Investments by (i) any Loan Party in any other Loan Party (other
than Holdings), (ii) a ▇▇▇▇▇▇ Entity that is not a Loan Party in any Loan Party
(other than Holdings), (iii) any ▇▇▇▇▇▇ Entity in Holdings by way of
intercompany loans, provided that if such investment were made as a cash
dividend by a Loan Party it would be permitted to be made pursuant to Section
8.5 (Restricted Payments) or (iv) any Loan Party in a ▇▇▇▇▇▇ Entity that is not
a Loan Party; provided, however, that the aggregate outstanding amount of all
Investments permitted pursuant to this clause (iv) shall not exceed $10,000,000
at any time;
89
(f) Investments in any Securitization Subsidiary consisting of assets
contributed or transferred by any ▇▇▇▇▇▇ Entity as the originator thereof to
such Securitization Subsidiary in connection with any Permitted Securitization;
(g) Investments by the Borrower or any Subsidiary Guarantor in a
Permitted Acquisition;
(h) Investments by the Borrower or any Subsidiary Guarantor in a
Permitted Joint Venture; provided, however, that (i) the aggregate outstanding
amount of all such Investments permitted by this clause (h) shall not exceed
$25,000,000 at any time of which amount no more than $10,000,000 may be made in
cash or Cash Equivalents and (ii) to the extent any Investment is made in the
form of a contribution of real or personal property of a Loan Party, such
Investment shall be calculated based on the Fair Market Value of such property;
(i) Investments constituting Guaranty Obligations permitted by Section
8.1 (Indebtedness);
(j) Investments in the nature of royalties, dedications of reserves
under Coal Supply Agreements or similar rights or interests granted, taken
subject to, or otherwise imposed on properties consistent with normal practices
in the mining industry;
(k) Loans or advances to employees of any ▇▇▇▇▇▇ Entity in the
ordinary course of business as presently conducted other than any loans or
advances that would be in violation of Section 402 of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act;
provided, however, that the Dollar Equivalent of the aggregate principal amount
of all loans and advances permitted pursuant to this clause (k) shall not exceed
$1,000,000 at any time;
(l) Investments constituting trade credit extended in the ordinary
course of business consistent with past practice; and
(m) Investments not otherwise permitted hereby; provided, however,
that (i) the aggregate outstanding amount of all such Investments shall not
exceed $15,000,000 at any time, and (ii) to the extent any Investment is made in
the form of a contribution of real or personal property of a Loan Party, such
Investment shall be calculated based on the Fair Market Value of such property.
Section 8.4 Sale of Assets
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, sell, convey, transfer, lease or otherwise
dispose of, any of their respective assets or any interest therein (including
the sale or factoring at maturity or collection of any accounts) to any Person,
or permit or suffer any other Person to acquire any interest in any of their
respective assets or, in the case of any Subsidiary, issue or sell any shares of
such Subsidiary's Stock or Stock Equivalent (any such disposition being an
"Asset Sale"), except for the following:
(a) the sale or disposition of inventory in the ordinary course of
business;
(b) the sale or disposition of equipment that has become obsolete or
is replaced or exchanged in the ordinary course of business;
90
(c) the sale or transfer of real or personal property to the extent
constituting an Investment permitted under Section 8.3(h) or Section 8.3(m)
(Investments);
(d) assignments and licenses of intellectual property of Holdings and
its Subsidiaries in the ordinary course of business;
(e) any Asset Sale to the Borrower or any Subsidiary Guarantor;
(f) the grant of licenses or easements or the lease or sublease of
real property or coal, oil or gas reserves not constituting a sale and
leaseback, to the extent not otherwise prohibited by this Agreement;
(g) any sale of accounts, payment intangibles and related collateral
pursuant to a Permitted Securitization;
(h) sale or discount of overdue accounts arising in the ordinary
course of business in connection with the compromise or collection thereof;
(i) any Property Loss Event (without giving effect to any threshold
contained in the definition of such term); provided, that the Net Cash Proceeds
thereof are applied as set forth in, and to the extent required by, Section 2.8
(Mandatory Prepayments);
(j) the sale of non-strategic coal reserves of up to $3,000,000 during
any Fiscal Year and exchanges of other coal, oil or gas reserves in the ordinary
course of business; provided, however, that reserves which constitute Collateral
shall only be exchanged for reserves which will constitute Collateral upon the
acquisition thereof by a ▇▇▇▇▇▇ Entity;
(k) any Asset Sale consummated as part of a sale and leaseback
transaction permitted by Section 8.16 (Operating Leases; Sale/Leasebacks);
provided, that (i) the Net Cash Proceeds thereof are applied as set forth in
Section 2.8 (Mandatory Prepayments), (ii) such Asset Sale is for Fair Market
Value; and
(l) as long as no Default or Event of Default is continuing or would
result therefrom, any other Asset Sale for Fair Market Value, payable in cash
upon such sale; provided, however, that with respect to any such Asset Sale
pursuant to this clause (l), (i) the aggregate consideration received during any
Fiscal Year for all such Asset Sales shall not exceed $10,000,000 and (ii) all
Net Cash Proceeds of such Asset Sale are applied as set forth in, and to the
extent required by, Section 2.8 (Mandatory Prepayments).
Section 8.5 Restricted Payments
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, directly or indirectly, declare, order, pay,
make or set apart any sum for any Restricted Payment except for the following:
(a) Restricted Payments by any Subsidiary of the Borrower to the
Borrower or any Subsidiary Guarantor;
(b) dividends and distributions declared and paid on the common Stock
of Holdings and payable only in common Stock of Holdings;
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(c) as long as no Default or Event of Default is continuing or would
result therefrom, cash dividends declared and paid on the common Stock (prior to
giving effect to any stock split after the date hereof) of Holdings not in
excess of $0.16 per share in any Fiscal Year;
(d) cash dividends or other distributions on the Stock of any Loan
Party to Holdings paid and declared in any Fiscal Year solely for the purpose of
funding the following:
(i) ordinary operating expenses of Holdings, including payments
in an amount necessary to permit Holdings to satisfy its obligation as a
reporting company under securities laws of the United States and to pay
regulatory compliance costs, salaries and other director or employee
compensation to officers or directors of Holdings, legal fees and expenses
and other miscellaneous administrative expenses;
(ii) liabilities (other than ordinary operating expenses included
in clause (i) above), judgments and settlements required to be paid by
Holdings in an amount not to exceed $10,000,000 in the aggregate in any
Fiscal Year;
(iii) (A) scheduled payments of interest by Holdings in respect
of its Indebtedness permitted under Section 8.1 (Indebtedness) and (B) the
repurchase of the 6.95% Notes to the extent permitted pursuant to Section
8.6(b) (Prepayment and Cancellation of Indebtedness); and
(iv) payments by Holdings in respect of foreign, federal, state
or local taxes owing by Holdings in respect of Holdings and its
Subsidiaries; provided, however, if Holdings forms a new Wholly-Owned
Subsidiary, all of the Stock of which is held by Holdings directly, such
payments shall not be materially greater than the amount that would be
payable by the Borrower, on a consolidated basis, if the Borrower were the
taxpayer;
provided, however, that the Restricted Payments described in this clause (d)
shall not be permitted if either (A) an Event of Default or Default shall have
occurred and be continuing at the date of declaration or payment thereof or
would result therefrom or (B) such Restricted Payment is prohibited under the
terms of any Indebtedness (other than the Obligations) of any ▇▇▇▇▇▇ Entity.
Section 8.6 Prepayment and Cancellation of Indebtedness
(a) Neither Holdings nor the Borrower shall, nor shall they permit any
of their respective Subsidiaries to, cancel any claim or Indebtedness owed to
any of them except (i) in the ordinary course of business consistent with past
practice and (ii) in respect of intercompany indebtedness of the Loan Parties.
(b) Neither Holdings nor the Borrower shall, nor shall they permit any
of their respective Subsidiaries to, prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner, or make
any payment in violation of any subordination terms of, any Indebtedness;
provided, however, that Holdings may (i) refinance in whole or in part the 6.95%
Notes with the proceeds of the issuance of New Securities to the extent the
issuance of such New Securities is permitted under Section 8.1(c)
(Indebtedness), (ii) repurchase the 6.95% Notes in an aggregate purchase amount
not to exceed $10,000,000, (iii) prepay the Secured Obligations in accordance
with the terms of this Agreement, (iv) make
92
regularly scheduled or otherwise required repayments or redemptions of existing
Indebtedness, (v) prepay any Indebtedness payable to any Loan Party by any
▇▇▇▇▇▇ Entity and (vi) renew, extend, refinance and refund Indebtedness, so long
as such renewal, extension, refinancing or refunding is permitted under Section
8.1(i) (Indebtedness).
Section 8.7 Restriction on Fundamental Changes; Permitted Acquisitions
Except in connection with a Permitted Acquisition, a Permitted
Reorganization or a dissolution permitted by Section 7.1 (Preservation of
Corporate Existence, Etc.), neither Holdings nor the Borrower shall, nor shall
they permit any of their respective Subsidiaries to, (a) merge with any Person,
(b) consolidate with any Person, (c) acquire all or substantially all of the
Stock or Stock Equivalents of any Person, (d) acquire all or substantially all
of the assets of any Person or all or substantially all of the assets
constituting the business of a division, branch or other unit operation of any
Person, (e) enter into any joint venture or partnership with any Person other
than in connection with a Permitted Joint Venture, the investment in which is
permitted by Section 8.3(h) or Section 8.3(m) (Investments) or (f) acquire or
create any Subsidiary unless, after giving effect to such creation or
acquisition, such Subsidiary is a Wholly-Owned Subsidiary of the Borrower, the
Borrower is in compliance with Section 7.16 (Additional Collateral and
Guaranties) and the Investment in such Subsidiary is permitted under Section
8.3(e) (Investments).
Section 8.8 Change in Nature of Business
(a) Neither Holdings nor the Borrower shall, nor shall they permit any
of their respective Subsidiaries to, make any material change in the nature or
conduct of its business as carried on at the date hereof, whether in connection
with a Permitted Acquisition or otherwise; provided that this clause (a) shall
not preclude a Proposed Acquisition of a Proposed Acquisition Target engaged in
a Similar Business or the formation of a Subsidiary of Holdings to be engaged in
a Similar Business.
(b) Holdings shall not engage in any business or activity other than
(i) holding shares in the Stock of the Borrower or one or more Guarantors, (ii)
incurrence and maintenance of Indebtedness pursuant to the 6.95% Notes and/or
the New Securities, as the case may be, and the performance of all activity
necessary in connection with either of the foregoing, (ii) paying taxes, (iii)
preparing reports to Governmental Authorities and to its shareholders and (iv)
holding directors and shareholders meetings, preparing corporate records and
other corporate activities required to maintain its separate corporate
structure.
Section 8.9 Transactions with Affiliates
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, except as otherwise expressly permitted
herein, do any of the following: (a) make any Investment in an Affiliate of the
Borrower that is not a Subsidiary of Holdings, (b) transfer, sell, lease, assign
or otherwise dispose of any asset to any Affiliate of the Borrower that is not a
Subsidiary of Holdings, (c) merge into or consolidate with or purchase or
acquire assets from any Affiliate of the Borrower that is not a Subsidiary of
Holdings, (d) repay any Indebtedness to any Affiliate of the Borrower that is
not a Subsidiary of Holdings or (e) enter into any other transaction directly or
indirectly with or for the benefit of any Affiliate of the Borrower that is not
a Guarantor (including guaranties and assumptions of obligations of any such
Affiliate), except for (i) transactions in the ordinary course of business on a
basis no less
93
favorable to the Borrower or such Guarantor as would be obtained in a comparable
arm's length transaction with a Person not an Affiliate and (ii) salaries and
other director or employee compensation to officers or directors of Holdings or
any of its Subsidiaries commensurate with current compensation levels.
Section 8.10 Limitations on Restrictions on Subsidiary Distributions;
No New Negative Pledge
Except pursuant to the Loan Documents, the 6.95% Indenture, the
Convertible Note Indenture, the New Securities Documents and any agreements
governing purchase money Indebtedness or Capital Lease Obligations permitted by
Section 8.1(b), (h) or (i) (Indebtedness) (in which latter case, any prohibition
or limitation shall only be effective against the assets financed thereby) or
Permitted Securitizations (in which case, any prohibition or limitation shall
only be effective against the receivables sold or financed pursuant thereto),
neither Holdings nor the Borrower shall, nor shall they permit any of their
respective Subsidiaries to, (a) agree to enter into or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of such Subsidiary to pay dividends or make any other distribution or transfer
of funds or assets or make loans or advances to or other Investments in, or pay
any Indebtedness owed to, the Borrower or any other Subsidiary of the Borrower
or (b) enter into or suffer to exist or become effective any agreement
prohibiting or limiting the ability of Holdings or any Subsidiary to create,
incur, assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, to secure the Obligations,
including any agreement requiring any other Indebtedness or Contractual
Obligation to be equally and ratably secured with the Obligations.
Section 8.11 Modification of Constituent Documents
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, change its capital structure (including in the
terms of its outstanding Stock) or otherwise amend its Constituent Documents,
except for changes and amendments that do not materially affect the rights and
privileges of any ▇▇▇▇▇▇ Entity and do not materially adversely affect the
interests of the Administrative Agent, the Lenders and the Issuers under the
Loan Documents or in the Collateral.
Section 8.12 Breach of Coal Supply Agreements; Mining Leases and Prep
Plant Leases
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to permit any breach or default attributable to
them to exist under any Coal Supply Agreement, Mining Lease or Prep Plant Lease
or take or fail to take any action thereunder, if to do so would reasonably be
expected to have a Material Adverse Effect.
Section 8.13 Modification of Material Debt Agreements
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, change or amend the terms of the 6.95% Notes,
the Convertible Notes or, following the issuance thereof, the New Securities (or
any indenture or agreement or other material document entered into in connection
therewith) if the effect of such amendment is to (a) increase the interest rate
on such Indebtedness, (b) change the dates upon which payments of principal or
interest are due on such Indebtedness other than to extend such dates, (c)
change any
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default or event of default other than to delete or make less restrictive any
default provision therein, or add any covenant with respect to such
Indebtedness, (d) change the redemption or prepayment provisions of such
Indebtedness other than to extend the dates therefor or to reduce the premiums
payable in connection therewith or (e) change or amend any other term if such
change or amendment would materially increase the obligations of the obligor or
confer additional material rights to the holder of such Indebtedness in a manner
adverse to a ▇▇▇▇▇▇ Entity, the Administrative Agent or any Lender.
Section 8.14 Accounting Changes; Fiscal Year
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, change its (a) accounting treatment and
reporting practices or tax reporting treatment, except as required or permitted
by GAAP or any Requirement of Law and disclosed to the Lenders and the
Administrative Agent or (b) Fiscal Year.
Section 8.15 Margin Regulations
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, use all or any portion of the proceeds of any
credit extended hereunder to purchase or carry margin stock (within the meaning
of Regulation U of the Federal Reserve Board) in contravention of Regulation U
of the Federal Reserve Board.
Section 8.16 Operating Leases; Sale/Leasebacks
(a) Neither Holdings nor the Borrower shall, nor shall they permit any
of their respective Subsidiaries to, become or remain liable as lessee or
guarantor or other surety with respect to any operating lease, unless that
aggregate amount of all rents paid or accrued under all such operating leases
shall not exceed $85,000,000 in any Fiscal Year.
(b) Neither Holdings nor the Borrower shall, nor shall they permit any
of their respective Subsidiaries to, enter into any sale and leaseback
transaction if, after giving effect to such sale and leaseback transaction, the
aggregate Fair Market Value of all properties covered by sale and leaseback
transactions would exceed $50,000,000; provided, however, that the Net Cash
Proceeds thereof are applied to the Obligations in accordance with Section
2.8(a) or Section 2.8(d) (Mandatory Prepayments) or, in connection with a sale
and leaseback of Westvaco or ▇▇▇▇▇▇▇, 50% of such Net Cash Proceeds are applied
in accordance with Section 2.8(e)(i) (Mandatory Prepayments).
Section 8.17 No Speculative Transactions
Neither Holdings nor the Borrower shall, nor shall they permit any of
their respective Subsidiaries to, engage in any speculative transaction or in
any transaction involving Hedging Contracts except for the sole purpose of
hedging in the normal course of business and consistent with industry practices.
Section 8.18 Compliance with ERISA
Neither Holdings nor the Borrower shall cause or permit to occur, nor
shall they permit any of their respective Subsidiaries or ERISA Affiliates to
cause or permit to occur, an event that could result in the imposition of a Lien
under Section 412 of the Code or Section 302
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or 4068 of ERISA or any other ERISA Events that in the aggregate would
reasonably be expected to result in a Material Adverse Effect.
ARTICLE IX
Events of Default
Section 9.1 Events of Default
Each of the following events shall be an Event of Default:
(a) the Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when the same becomes due and payable; or
(b) the Borrower shall fail to pay any interest on any Loan, any fee
under any of the Loan Documents or any other Obligation (other than one referred
to in clause (a) above) and such non-payment continues for a period of three
Business Days after the due date therefor; or
(c) any representation or warranty made or deemed made by any Loan
Party in any Loan Document or by any Loan Party (or any of its officers) in
connection with any Loan Document shall prove to have been incorrect in any
material respect when made or deemed made; or
(d) any Loan Party shall fail to perform or observe (i) any term,
covenant or agreement contained in Article V (Financial Covenants), Section 6.1
(Financial Statements), 6.2 (Default Notices), 7.1 (Preservation of Corporate
Existence, Etc.), 7.6 (Access), 7.9 (Material Contracts), or Article VIII
(Negative Covenants) or (ii) any other term, covenant or agreement contained in
this Agreement or in any other Loan Document if such failure under this clause
(ii) shall remain unremedied for 30 days after the earlier of (A) the date on
which a Responsible Officer of the Borrower becomes aware of such failure and
(B) the date on which written notice thereof shall have been given to the
Borrower by the Administrative Agent or any Lender; or
(e) (i) Holdings or any of its Subsidiaries shall fail to make any
payment on any Indebtedness (including, but not limited to, any Permitted
Securitization) of Holdings or any such Subsidiary (other than the Obligations)
or any Guaranty Obligation in respect of Indebtedness of any other Person, and,
in each case, such failure relates to Indebtedness having a principal amount of
$20,000,000 or more, when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), (ii) any
other event shall occur or condition shall exist under any agreement or
instrument relating to any such Indebtedness, if the effect of such event or
condition is to accelerate, or to permit the acceleration of, the maturity of
such Indebtedness or (iii) any such Indebtedness shall become or be declared to
be due and payable, or required to be prepaid or repurchased (other than by a
regularly scheduled required prepayment), prior to the stated maturity thereof;
or
(f) Holdings or any of its Subsidiaries shall default in any payment
under any Mining Lease or Prep Plant Lease, or shall default in the observance
or performance of any other agreement or condition relating to any Mining Lease
or Prep Plant Lease, or any other event shall occur or condition exist, the
effect of which default or other event or condition is to cause, or to permit
the lessor under such Mining Lease or such Prep Plant Lease to terminate such
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Mining Lease or such Prep Plant Lease, such default continues for a period in
excess of 15 days and the termination of such Mining Lease or Prep Plant Lease
would result in a Material Adverse Effect; or
(g) (i) Holdings or any of its Subsidiaries shall generally not pay
its debts as such debts become due, shall admit in writing its inability to pay
its debts generally or shall make a general assignment for the benefit of
creditors, (ii) any proceeding shall be instituted by or against Holdings or any
of its Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts, under any Requirement of Law relating
to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a custodian, receiver,
trustee or other similar official for it or for any substantial part of its
property; provided, however, that, in the case of any such proceedings
instituted against Holdings or any of its Subsidiaries (but not instituted by
Holdings or any of its Subsidiaries), either such proceedings shall remain
undismissed or unstayed for a period of 60 days or more or any action sought in
such proceedings shall occur or (iii) Holdings or any of its Subsidiaries shall
take any corporate action to authorize any action set forth in clauses (i) and
(ii) above; or
(h) one or more judgments or orders (or other similar process)
involving, in the case of money judgments, an aggregate amount in excess of
$20,000,000, to the extent not covered by insurance, bonded or paid shall be
rendered against one or more of Holdings and its Subsidiaries and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or
(i) an ERISA Event shall occur and the amount of all liabilities and
deficiencies resulting therefrom, whether or not assessed would exceed
$20,000,000 in the aggregate; or
(j) any provision of any Collateral Document or the Guaranty after
delivery thereof pursuant to this Agreement or any other Loan Document shall for
any reason cease to be valid and binding on, or enforceable against, any Loan
Party thereto, or any Loan Party shall so state in writing; or
(k) except (i) as otherwise set forth in Section 3.1(a)(iv)
(Conditions Precedent to Initial Loans and Letters of Credit) with respect to
leasehold Mortgages or (ii) with respect Collateral that in the aggregate does
not have a fair market value in excess of $1,000,000, any Collateral Document
shall for any reason fail or cease to create a valid Lien on any Collateral
purported to be covered thereby or, except as permitted by the Loan Documents,
such Lien shall fail or cease to be a perfected and first priority Lien or any
Loan Party shall so state in writing unless such failure relates to Collateral
that in the aggregate does not have a fair market value in excess of $20,000,000
and such failure is remedied within 10 days after the earlier of (A) the date on
which a Responsible Officer of the Borrower becomes aware of such failure and
(B) the date on which written notice thereof shall have been given to the
Borrower by the Administrative Agent or any Lender; or
(l) there shall occur any Change of Control; or
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(m) one or more of Holdings and its Subsidiaries shall have entered
into one or more consent or settlement decrees or agreements or similar
arrangements with a Governmental Authority or one or more judgments, orders,
decrees or similar actions shall have been entered against one or more of
Holdings and its Subsidiaries based on or arising from the violation of or
pursuant to any Environmental Law, or the generation, storage, transportation,
treatment, disposal or Release of any Contaminant and, in connection with all
the foregoing, Holdings and its Subsidiaries are likely to incur Environmental
Liabilities and Costs that in the aggregate would reasonably be expected to
result in a Material Adverse Effect.
Section 9.2 Remedies
During the continuance of any Event of Default, the Administrative
Agent (a) may, and, at the request of the Requisite Lenders, shall, by notice to
the Borrower declare that all or any portion of the Commitments be terminated,
whereupon the obligation of each Lender to make any Loan and each Issuer to
Issue any Letter of Credit shall immediately terminate and (b) may and, at the
request of the Requisite Lenders, shall, by notice to the Borrower, declare the
Loans, all interest thereon and all other amounts and Obligations payable under
this Agreement to be forthwith due and payable, whereupon the Loans, all such
interest and all such amounts and Obligations shall become and be forthwith due
and payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by the Borrower; provided, however,
that upon the occurrence of the Events of Default specified in Section 9.1(g)
(Events of Default), (x) the Commitments of each Lender to make Loans and the
commitments of each Lender and Issuer to Issue or participate in Letters of
Credit shall each automatically be terminated and (y) the Loans, all such
interest and all such amounts and Obligations shall automatically become and be
due and payable, without presentment, demand, protest or any notice of any kind,
all of which are hereby expressly waived by the Borrower. In addition to the
remedies set forth above, the Administrative Agent may exercise any remedies
provided for by the Collateral Documents in accordance with the terms thereof or
any other remedies provided by applicable law.
Section 9.3 Actions in Respect of Letters of Credit
At any time (i) upon the Revolving Credit Termination Date, (ii) after
the Revolving Credit Termination Date when the aggregate funds on deposit in
Cash Collateral Accounts shall be less than 105% of the Letter of Credit
Obligations, (iii) as may be required by Section 2.8(c) or Section 2.8(d)
(Mandatory Prepayments), the Borrower shall pay to the Administrative Agent in
immediately available funds at the Administrative Agent's office referred to in
Section 11.8 (Notices, Etc.), for deposit in a Cash Collateral Account, (x) in
the case of clauses (i) and (ii) above, the amount required to that, after such
payment, the aggregate funds on deposit in the Cash Collateral Accounts equals
or exceeds 105% of the sum of all outstanding Letter of Credit Obligations and
(y) in the case of clause (iii) above, the amount required by Section 2.8(c)or
Section 2.8(e)(iii) (Mandatory Prepayments). The Administrative Agent may, from
time to time after funds are deposited in any Cash Collateral Account, apply
funds then held in such Cash Collateral Account to the payment of any amounts,
in accordance with Section 2.8(c) (Mandatory Prepayments) and Section 2.12(g)
(Payments and Computations), as shall have become or shall become due and
payable by the Borrower to the Issuers or Lenders in respect of the Letter of
Credit Obligations. The Administrative Agent shall promptly give written notice
of any such application; provided, however, that the failure to give such
written notice shall not invalidate any such application.
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Section 9.4 Rescission
If at any time after termination of the Commitments or acceleration of
the maturity of the Loans, the Borrower shall pay all arrears of interest and
all payments on account of principal of the Loans and Reimbursement Obligations
that shall have become due otherwise than by acceleration (with interest on
principal and, to the extent permitted by law, on overdue interest, at the rates
specified herein) and all Events of Default and Defaults (other than non-payment
of principal of and accrued interest on the Loans due and payable solely by
virtue of acceleration) shall be remedied or waived pursuant to Section 11.1
(Amendments, Waivers, Etc.), then upon the written consent of the Requisite
Lenders and written notice to the Borrower, the termination of the Commitments
or the acceleration and their consequences may be rescinded and annulled;
provided, however, that such action shall not affect any subsequent Event of
Default or Default or impair any right or remedy consequent thereon. The
provisions of the preceding sentence are intended merely to bind the Lenders and
the Issuers to a decision that may be made at the election of the Requisite
Lenders, and such provisions are not intended to benefit the Borrower and do not
give the Borrower the right to require the Lenders to rescind or annul any
acceleration hereunder, even if the conditions set forth herein are met.
ARTICLE X
The Administrative Agent
Section 10.1 Authorization and Action
(a) Each Lender and each Issuer hereby appoints CNAI as the
Administrative Agent hereunder and each Lender and each Issuer authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement and the other Loan Documents as are delegated
to the Administrative Agent under such agreements and to exercise such powers as
are reasonably incidental thereto. Without limiting the foregoing, each Lender
and each Issuer hereby authorizes the Administrative Agent to execute and
deliver, and to perform its obligations under, each of the Loan Documents to
which the Administrative Agent is a party, to exercise all rights, powers and
remedies that the Administrative Agent may have under such Loan Documents and,
in the case of the Collateral Documents, to act as agent for the Lenders,
Issuers and the other Secured Parties under such Collateral Documents.
(b) As to any matters not expressly provided for by this Agreement and
the other Loan Documents (including enforcement or collection), the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Requisite Lenders, and such instructions shall be binding upon all Lenders
and each Issuer; provided, however, that the Administrative Agent shall not be
required to take any action that (i) the Administrative Agent in good faith
believes exposes it to personal liability unless the Administrative Agent
receives an indemnification satisfactory to it from the Lenders and the Issuers
with respect to such action or (ii) is contrary to this Agreement or applicable
law. The Administrative Agent agrees to give to each Lender and each Issuer
prompt notice of each notice given to it by any Loan Party pursuant to the terms
of this Agreement or the other Loan Documents.
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(c) In performing its functions and duties hereunder and under the
other Loan Documents, the Administrative Agent is acting solely on behalf of the
Lenders and the Issuers and its duties are entirely administrative in nature.
The Administrative Agent does not assume and shall not be deemed to have assumed
any obligation other than as expressly set forth herein and in the other Loan
Documents or any other relationship as the agent, fiduciary or trustee of or for
any Lender, Issuer or holder of any other Obligation. The Administrative Agent
may perform any of its duties under any Loan Document by or through its agents
or employees.
(d) No Co-Syndication Agent or Arranger shall have any obligations or
duties whatsoever in such capacity under this Agreement or any other Loan
Document and shall incur no liability hereunder or thereunder in such capacity.
Section 10.2 Administrative Agent's Reliance, Etc.
None of the Administrative Agent, any of its Affiliates or any of
their respective directors, officers, agents or employees shall be liable for
any action taken or omitted to be taken by it, him, her or them under or in
connection with this Agreement or the other Loan Documents, except for its, his,
her or their own gross negligence or willful misconduct. Without limiting the
foregoing, the Administrative Agent (a) may treat the payee of any Note as its
holder until such Note has been assigned in accordance with Section 11.2
(Assignments and Participations), (b) may rely on the Register to the extent set
forth in Section 11.2(c) (Assignments and Participations), (c) may consult with
legal counsel (including counsel to the Borrower or any other Loan Party),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts, (d) makes no
warranty or representation to any Lender or Issuer and shall not be responsible
to any Lender or Issuer for any statements, warranties or representations made
by or on behalf of Holdings or any of its Subsidiaries in or in connection with
this Agreement or any other Loan Document, (e) shall not have any duty to
ascertain or to inquire either as to the performance or observance of any term,
covenant or condition of this Agreement or any other Loan Document, as to the
financial condition of any Loan Party or as to the existence or possible
existence of any Default or Event of Default, (f) shall not be responsible to
any Lender or Issuer for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of, or the attachment, perfection or priority
of any Lien created or purported to be created under or in connection with, this
Agreement, any other Loan Document or any other instrument or document furnished
pursuant hereto or thereto and (g) shall incur no liability under or in respect
of this Agreement or any other Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which writing may be a telecopy or
electronic mail) or any telephone message believed by it to be genuine and
signed or sent by the proper party or parties.
Section 10.3 Posting of Approved Electronic Communications
(a) Each of the Lenders, the Issuers, Holdings and the Borrower agree,
and the Borrower shall cause each Subsidiary Guarantor to agree, that the
Administrative Agent may, but shall not be obligated to, make the Approved
Electronic Communications available to the Lenders and Issuers by posting such
Approved Electronic Communications on "e-Disclosure", the Agent's internet
delivery system that is part of Fixed Income Direct, Citigroup Global Fixed
Income's primary web portal, IntraLinks(TM) or a successor electronic platform
chosen by the Administrative Agent to be its internet delivery system (the
"Approved Electronic Platform").
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(b) Although the Approved Electronic Platform and its primary web
portal are secured with generally-applicable security procedures and policies
implemented or modified by the Administrative Agent from time to time
(including, as of the Closing Date, a dual firewall and a User ID/Password
Authorization System) and the Approved Electronic Platform is secured through a
single-user-per-deal authorization method whereby each user may access the
Approved Electronic Platform only on a deal-by-deal basis, each of the Lenders,
the Issuers, Holdings and the Borrower acknowledges and agrees, and the Borrower
shall cause each Subsidiary Guarantor to acknowledge and agree, that the
distribution of material through an electronic medium is not necessarily secure
and that there are confidentiality and other risks associated with such
distribution. In consideration for the convenience and other benefits afforded
by such distribution and for the other consideration provided hereunder, the
receipt and sufficiency of which is hereby acknowledged, each of the Lenders,
the Issuers, Holdings and the Borrower hereby approves, and the Borrower shall
cause each Subsidiary Guarantor to approve, distribution of the Approved
Electronic Communications through the Approved Electronic Platform and
understands and assumes, and the Borrower shall cause each Subsidiary Guarantor
to understand and assume, the risks of such distribution.
(c) The Approved Electronic Communications and the Approved Electronic
Platform are provided "as is" and "as available". None of the Administrative
Agent or any of its Affiliates or any of their respective officers, directors,
employees, agents, advisors or representatives (the "Agent Affiliates") warrant
the accuracy, adequacy or completeness of the Approved Electronic Communications
and the Approved Electronic Platform and each expressly disclaims liability for
errors or omissions in the Approved Electronic Communications and the Approved
Electronic Platform. No warranty of any kind, express, implied or statutory
(including any warranty of merchantability, fitness for a particular purpose,
non-infringement of third party rights or freedom from viruses or other code
defects) is made by the Agent's Affiliates in connection with the Approved
Electronic Communications.
(d) Each of the Lenders, the Issuers, Holdings and the Borrower agree,
and the Borrower shall cause each Subsidiary Guarantor to agree, that the
Administrative Agent may, but (except as may be required by applicable law)
shall not be obligated to, store the Approved Electronic Communications on the
Approved Electronic Platform in accordance with the Administrative Agent's
generally-applicable document retention procedures and policies.
Section 10.4 The Administrative Agent Individually
With respect to its Ratable Portion, CNAI shall have and may exercise
the same rights and powers hereunder and is subject to the same obligations and
liabilities as and to the extent set forth herein for any other Lender. The
terms "Lenders", "Revolving Credit Lenders", "Term Loan Lenders", "Requisite
Lenders" and any similar terms shall, unless the context clearly otherwise
indicates, include, without limitation, the Administrative Agent in its
individual capacity as a Lender, a Revolving Credit Lender, Term Loan Lender or
as one of the Requisite Lenders. CNAI and its Affiliates may accept deposits
from, lend money to, and generally engage in any kind of banking, trust or other
business with, any Loan Party as if CNAI were not acting as the Administrative
Agent.
Section 10.5 Lender Credit Decision
Each Lender and each Issuer acknowledges that it shall, independently
and without reliance upon the Administrative Agent or any other Lender conduct
its own independent
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investigation of the financial condition and affairs of the Borrower and each
other Loan Party in connection with the making and continuance of the Loans and
with the issuance of the Letters of Credit. Each Lender and each Issuer also
acknowledges that it shall, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement and other
Loan Documents.
Section 10.6 Indemnification
Each Lender agrees to indemnify the Administrative Agent and each of
its Affiliates, and each of their respective directors, officers, employees,
agents and advisors (to the extent not reimbursed by the Borrower), from and
against such Lender's aggregate Ratable Portion of any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and disbursements (including fees, expenses and disbursements of
financial and legal advisors) of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against, the Administrative Agent or any of
its Affiliates, directors, officers, employees, agents and advisors in any way
relating to or arising out of this Agreement or the other Loan Documents or any
action taken or omitted by the Administrative Agent under this Agreement or the
other Loan Documents; provided, however, that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the
Administrative Agent's or such Affiliate's gross negligence or willful
misconduct. Without limiting the foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including fees, expenses and disbursements of financial
and legal advisors) incurred by the Administrative Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of its rights or responsibilities under, this
Agreement or the other Loan Documents, to the extent that the Administrative
Agent is not reimbursed for such expenses by the Borrower or another Loan Party.
Section 10.7 Successor Administrative Agent
The Administrative Agent may resign at any time by giving written
notice thereof to the Lenders and the Borrower. Upon any such resignation, the
Requisite Lenders shall have the right to appoint a successor Administrative
Agent. If no successor Administrative Agent shall have been so appointed by the
Requisite Lenders, and shall have accepted such appointment, within 30 days
after the retiring Administrative Agent's giving of notice of resignation, then
the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent, selected from among the Lenders. In either case,
such appointment shall be subject to the prior written approval of the Borrower
(which approval may not be unreasonably withheld and shall not be required upon
the occurrence and during the continuance of an Event of Default). Upon the
acceptance of any appointment as Administrative Agent by a successor
Administrative Agent, such successor Administrative Agent shall succeed to, and
become vested with, all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents. Prior to any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the retiring Administrative Agent shall take
such action as may be reasonably necessary to assign to the successor
Administrative Agent its rights as Administrative Agent under the Loan
Documents. After such resignation, the retiring Administrative Agent shall
continue to have the benefit of this Article X as to any actions taken or
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omitted to be taken by it while it was Administrative Agent under this Agreement
and the other Loan Documents.
Section 10.8 Concerning the Collateral and the Collateral Documents
(a) Each Lender and each Issuer agrees that any action taken by the
Administrative Agent or the Requisite Lenders (or, where required by the express
terms of this Agreement, a greater proportion of the Lenders) in accordance with
the provisions of this Agreement or of the other Loan Documents, and the
exercise by the Administrative Agent or the Requisite Lenders (or, where so
required, such greater proportion) of the powers set forth herein or therein,
together with such other powers as are reasonably incidental thereto, shall be
authorized and binding upon all of the Lenders, Issuers and other Secured
Parties. Without limiting the generality of the foregoing, the Administrative
Agent shall have the sole and exclusive right and authority to (i) act as the
disbursing and collecting agent for the Lenders and the Issuers with respect to
all payments and collections arising in connection herewith and with the
Collateral Documents, (ii) execute and deliver each Collateral Document and
accept delivery of each such agreement delivered by Holdings or any of its
Subsidiaries, (iii) act as collateral agent for the Lenders, the Issuers and the
other Secured Parties for purposes of the perfection of all security interests
and Liens created by such agreements and all other purposes stated therein,
provided, however, that the Administrative Agent hereby appoints, authorizes and
directs each Lender and Issuer to act as collateral sub-agent for the
Administrative Agent, the Lenders and the Issuers for purposes of the perfection
of all security interests and Liens with respect to any item of Collateral
(including, but not limited to, Deposit Accounts), (iv) manage, supervise and
otherwise deal with the Collateral, (v) take such action as is necessary or
desirable to maintain the perfection and priority of the security interests and
Liens created or purported to be created by the Collateral Documents and (vi)
except as may be otherwise specifically restricted by the terms hereof or of any
other Loan Document, exercise all remedies given to the Administrative Agent,
the Lenders, the Issuers and the other Secured Parties with respect to the
Collateral under the Loan Documents relating thereto, applicable law or
otherwise.
(b) Each of the Lenders and the Issuers hereby consents to the release
of, and hereby directs, in accordance with the terms hereof, the Administrative
Agent to release (or, with respect to Liens described clause (ii) below, the
release of or subordination to) any Lien held by the Administrative Agent for
the benefit of the Lenders and the Issuers on any of the following:
(i) all of the Collateral and all of the Loan Parties, upon
termination of the Commitments and payment and satisfaction in full of all
Loans, Reimbursement Obligations and all other Obligations that the
Administrative Agent has been notified in writing are then due and payable
(and, in respect of contingent Letter of Credit Obligations, with respect
to which cash collateral has been deposited or a back-up letter of credit
has been issued, in either case on terms satisfactory to the Administrative
Agent and the applicable Issuers);
(ii) any assets that are or may become subject to Liens permitted
by Section 8.2(c) or Section 8.2(d) (Liens); and
(iii) any part of the Collateral (A) sold or disposed of by a
Loan Party if such sale or disposition is permitted by this Agreement (or
permitted pursuant to a waiver or consent of a transaction otherwise
prohibited by this Agreement) (other than an Asset Sale pursuant to Section
8.4(e) (Asset Sales)) or (B) that constitutes Stock or
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intercompany Indebtedness of a Subsidiary Guarantor if such Subsidiary
Guarantor has been dissolved pursuant to Section 7.1 (Preservation of
Corporate Existence, Etc.) or sold or disposed of pursuant to Section 8.4
(Sale of Assets).
Each of the Lenders and the Issuers hereby consents to the release and
hereby directs, in accordance with the terms hereof, the Administrative Agent to
release any Subsidiary Guarantor from its obligations under the Guaranty if the
Stock of such Subsidiary Guarantor is being dissolved pursuant to Section 7.1
(Preservation of Corporate Existence, Etc.) or sold or disposed of, if such sale
or disposition is permitted by this Agreement (or permitted pursuant to a waiver
or consent of a transaction otherwise prohibited by this Agreement) (other than
an Asset Sale pursuant to Section 8.4(e) (Asset Sales)), or, if not pursuant to
such sale or disposition, if such release is consented to by the Lenders
required to consent thereto under Section 11.1 (Amendments, Waivers, Etc.).
Each of the Lenders and the Issuers hereby directs the Administrative Agent to
execute and deliver or file such termination and partial release statements and
do such other things as are necessary to release Liens to be released pursuant
to this Section 10.8 promptly upon the effectiveness of any such release.
Section 10.9 Collateral Matters Relating to Related Obligations
The benefit of the Loan Documents and of the provisions of this
Agreement relating to the Collateral shall extend to and be available in respect
of any Secured Obligation arising under any Hedging Contract or Cash Management
Obligation or that is otherwise owed to Persons other than the Administrative
Agent, the Lenders and the Issuers (collectively, "Related Obligations") solely
on the condition and understanding, as among the Administrative Agent and all
Secured Parties, that (a) the Related Obligations shall be entitled to the
benefit of the Loan Documents and the Collateral to the extent expressly set
forth in this Agreement and the other Loan Documents and to such extent the
Administrative Agent shall hold, and have the right and power to act with
respect to, the Guaranty and the Collateral on behalf of and as agent for the
holders of the Related Obligations, but the Administrative Agent is otherwise
acting solely as agent for the Lenders and the Issuers and shall have no
fiduciary duty, duty of loyalty, duty of care, duty of disclosure or other
obligation whatsoever to any holder of Related Obligations, (b) all matters,
acts and omissions relating in any manner to the Guaranty, the Collateral, or
the omission, creation, perfection, priority, abandonment or release of any
Lien, shall be governed solely by the provisions of this Agreement and the other
Loan Documents and no separate Lien, right, power or remedy shall arise or exist
in favor of any Secured Party under any separate instrument or agreement or in
respect of any Related Obligation, (c) each Secured Party shall be bound by all
actions taken or omitted, in accordance with the provisions of this Agreement
and the other Loan Documents, by the Administrative Agent and the Requisite
Lenders, each of whom shall be entitled to act at its sole discretion and
exclusively in its own interest given its own Commitments and its own interest
in the Loans, Letter of Credit Obligations and other Obligations to it arising
under this Agreement or the other Loan Documents, without any duty or liability
to any other Secured Party or as to any Related Obligation and without regard to
whether any Related Obligation remains outstanding or is deprived of the benefit
of the Collateral or becomes unsecured or is otherwise affected or put in
jeopardy thereby, (d) no holder of Related Obligations and no other Secured
Party (except the Administrative Agent, the Lenders and the Issuers, to the
extent set forth in this Agreement) shall have any right to be notified of, or
to direct, require or be heard with respect to, any action taken or omitted in
respect of the Collateral or under this Agreement or the Loan Documents and (e)
no holder of any Related Obligation shall
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exercise any right of setoff, banker's lien or similar right except to the
extent provided in Section 11.6 (Right of Set-off) and then only to the extent
such right is exercised in compliance with Section 11.7 (Sharing of Payments,
Etc.).
ARTICLE XI
Miscellaneous
Section 11.1 Amendments, Waivers, Etc.
(a) No amendment or waiver of any provision of this Agreement or any
other Loan Document nor consent to any departure by any Loan Party therefrom
shall in any event be effective unless the same shall be in writing and signed
by the Administrative Agent (with the consent of the Requisite Lenders) and, in
the case of any amendment, by the Borrower, and then any such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given; provided, however, that no amendment, waiver or consent shall,
unless in writing and signed by the Administrative Agent (with the consent of
each Lender directly affected thereby, in addition to the Requisite Lenders), do
any of the following:
(i) waive any condition specified in Section 3.1 (Conditions
Precedent to Initial Loans and Letters of Credit) or 3.2(b) (Conditions
Precedent to Each Loan and Letter of Credit), except with respect to a
condition based upon another provision hereof, the waiver of which requires
only the concurrence of the Requisite Lenders and, in the case of the
conditions specified in Section 3.1 (Conditions Precedent to Initial Loans
and Letters of Credit), subject to the provisions of Section 3.3
(Determinations of Initial Borrowing Conditions);
(ii) increase the Commitment of such Lender or subject such
Lender to any additional obligation; provided, however, that any such
increase with respect to the Term Loan Commitment or the Revolving Credit
Commitment shall require the consent of the Requisite Term Loan Lenders or
the Requisite Revolving Credit Lenders, as the case may be;
(iii) extend the scheduled final maturity of any Loan owing to
such Lender, or waive, reduce or postpone any scheduled date fixed for the
payment or reduction of principal of any such Loan (it being understood
that Section 2.8 (Mandatory Prepayments) does not provide for scheduled
dates fixed for payment) or for the reduction of such Lender's Commitment;
(iv) reduce the principal amount of any Loan or Reimbursement
Obligation owing to such Lender (other than by the payment or prepayment
thereof);
(v) reduce the rate of interest on any Loan or Reimbursement
Obligations outstanding to such Lender or any fee payable hereunder to such
Lender;
(vi) postpone any scheduled date fixed for payment of such
interest or fees owing to such Lender;
(vii) change the aggregate Ratable Portions of Lenders required
for any or all Lenders to take any action hereunder;
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(viii) release all or substantially all of the Collateral except
as provided in Section 10.8(b) (Concerning the Collateral and the
Collateral Documents) or release the Borrower from its payment obligation
to such Lender under this Agreement or the Notes owing to such Lender (if
any) or release any Guarantor from its obligations under the Guaranty
except in connection with the dissolution, sale or other disposition of a
Subsidiary Guarantor (or all or substantially all of the assets thereof)
permitted by this Agreement (or permitted pursuant to a waiver or consent
of a transaction otherwise prohibited by this Agreement); or
(ix) amend this Section 11.1 or either definition of the terms
"Requisite Lenders" or "Ratable Portion";
and provided, further, that (A) any modification of the application of payments
to the Term Loans (in a manner which is disproportionately adverse to the Term
Loan Lenders) pursuant to Section 2.8 (Mandatory Prepayments) or Section 2.12(f)
(Payments and Computations) shall require the consent of the Requisite Term Loan
Lenders and any such modification of the application of payments to the
Revolving Loans (in a manner which is disproportionately adverse to the
Revolving Lenders) pursuant to Section 2.8 (Mandatory Prepayments) or Section
2.12(f) (Payments and Computations) or the reduction of the Revolving Credit
Commitments pursuant to Section 2.4(b) (Reduction and Termination of the
Revolving Credit Commitments) shall require the consent of the Requisite
Revolving Credit Lenders, (B) no amendment, waiver or consent shall, unless in
writing and signed by any Special Purpose Vehicle that has been granted an
option pursuant to Section 11.2(f) (Assignments and Participations) affect the
grant or nature of such option or the right or duties of such Special Purpose
Vehicle hereunder, (C) no amendment, waiver or consent shall, unless in writing
and signed by the Administrative Agent in addition to the Lenders required above
to take such action, affect the rights or duties of the Administrative Agent
under this Agreement or the other Loan Documents, and (D) no amendment, waiver
or consent shall, unless in writing and signed by an Issuer in addition to the
Lenders required above to take such action, affect the rights or duties of such
Issuer under this Agreement or the other Loan Documents.
(b) The Administrative Agent may, but shall have no obligation to,
with the written concurrence of any Lender, execute amendments, modifications,
waivers or consents on behalf of such Lender. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on the Borrower in any case shall entitle
the Borrower to any other or further notice or demand in similar or other
circumstances.
(c) If, in connection with any proposed amendment, modification,
waiver or termination (a "Proposed Change") requiring the consent of all
affected Lenders, the consent of Requisite Lenders is obtained but the consent
of other Lenders whose consent is required is not obtained (any such Lender
whose consent is not obtained as described in this Section 11.1 being referred
to as a "Non-Consenting Lender"), then, so long as the Lender acting as the
Administrative Agent is not a Non-Consenting Lender, at the Borrower's request,
an Eligible Assignee acceptable to the Administrative Agent shall have the right
with the Administrative Agent's consent and in the Administrative Agent's sole
discretion (but shall have no obligation) to purchase from such Non-Consenting
Lender, and such Non-Consenting Lender agrees that it shall, upon the
Administrative Agent's request, sell and assign to the Lender acting as the
Administrative Agent or such Eligible Assignee, all of the Commitments, Term
Loans and Revolving Credit Outstandings of such Non-Consenting Lender for an
amount equal to the
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principal balance of all Loans held by the Non-Consenting Lender and all accrued
interest and fees with respect thereto through the date of sale; provided,
however, that such purchase and sale shall not be effective until (x) the
Administrative Agent shall have received from such Eligible Assignee an
agreement in form and substance satisfactory to the Administrative Agent and the
Borrower whereby such Eligible Assignee shall agree to be bound by the terms
hereof and (y) such Non-Consenting Lender shall have received payments of all
Loans held by it and all accrued and unpaid interest and fees with respect
thereto through the date of the sale. Each Lender agrees that, if it becomes a
Non-Consenting Lender, it shall execute and deliver to the Administrative Agent
an Assignment an Acceptance to evidence such sale and purchase and shall deliver
to the Administrative Agent any Note (if the assigning Lender's Loans are
evidenced by Notes) subject to such Assignment and Acceptance; provided,
however, that the failure of any Non-Consenting Lender to execute an Assignment
and Acceptance shall not render such sale and purchase (and the corresponding
assignment) invalid.
Section 11.2 Assignments and Participations
(a) Each Lender may sell, transfer, negotiate or assign to one or more
Eligible Assignees all or a portion of its rights and obligations hereunder
(including all of its rights and obligations with respect to the Term Loans, the
Revolving Loans and the Letters of Credit); provided, however, that (i)(A) if
any such assignment shall be of the assigning Lender's Revolving Credit
Outstandings and Revolving Credit Commitments, such assignment shall cover the
same percentage of such Lender's Revolving Credit Outstandings and Revolving
Credit Commitment and (B) if any such assignment shall be of the assigning
Lender's Term Loans and Term Loan Commitment, such assignment shall cover the
same percentage of such Lender's Term Loans and Term Loan Commitment, (ii) the
aggregate amount being assigned pursuant to each such assignment (determined as
of the date of the Assignment and Acceptance with respect to such assignment)
shall in no event (if less than the Assignor's entire interest), in respect of
the Revolving Credit Facility, be less than $5,000,000 or an integral multiple
of $1,000,000 in excess thereof, and, in respect of the Term Loan Facility, be
less than $1,000,000 or an integral multiple of $1,000,000 in excess thereof,
except, in either case, (A) with the consent of the Administrative Agent or (B)
if such assignment is being made to a Lender or an Affiliate or Approved Fund of
such Lender, and (iii) if such Eligible Assignee is not, prior to the date of
such assignment, a Lender or an Affiliate or Approved Fund of a Lender, such
assignment shall be subject to the prior consent of the Administrative Agent and
the Borrower (which consent shall not be unreasonably withheld or delayed); and
provided, further, that, notwithstanding any other provision of this Section
11.2, the consent of the Borrower shall not be required for any assignment
occurring when any Event of Default shall have occurred and be continuing and
shall not in any case be required with respect to assignments of Term Loans. Any
such assignment need not be ratable as among the Term Loan Facility and the
Revolving Credit Facility.
(b) The parties to each such assignment shall execute and deliver to
the Administrative Agent, for its acceptance and recording, an Assignment and
Acceptance, together with any Note (if the assigning Lender's Loans are
evidenced by a Note) subject to such assignment. Upon the execution, delivery,
acceptance and recording of any Assignment and Acceptance and, other than in
respect of assignments made pursuant to Section 2.16 (Substitution of Lenders)
and Section 11.1(c) (Amendments, Waivers, Etc.), the receipt by the
Administrative Agent from the assignee of an assignment fee in the amount of
$3,500 from and after the effective date specified in such Assignment and
Acceptance, (i) the assignee thereunder shall become a party hereto and, to the
extent that rights and obligations under the Loan Documents have been
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assigned to such assignee pursuant to such Assignment and Acceptance, have the
rights and obligations of a Lender, and if such Lender were an Issuer, of such
Issuer hereunder and thereunder, (ii) Notes (if any) corresponding to the Loans
assigned thereby shall be transferred to such assignee by notification in the
Register and (iii) the assignor thereunder shall, to the extent that rights and
obligations under this Agreement have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights (except for those surviving the
payment in full of the Obligations) and be released from its obligations under
the Loan Documents, other than those relating to events or circumstances
occurring prior to such assignment (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under the Loan Documents, such Lender shall cease to be a party
hereto).
(c) The Administrative Agent shall maintain at its address referred to
in Section 11.8 (Notices, Etc.) a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recording of the names
and addresses of the Lenders and the Commitments of and principal amount of the
Loans and Letter of Credit Obligations owing to each Lender from time to time
(the "Register"). Any assignment pursuant to this Section 11.2 shall not be
effective until such assignment is recorded in the Register. The entries in the
Register shall be conclusive and binding for all purposes, absent manifest
error, and the Loan Parties, the Administrative Agent and the Lenders may treat
each Person whose name is recorded in the Register as a Lender for all purposes
of this Agreement. The Register shall be available for inspection by the
Borrower and the Administrative Agent at any reasonable time and from time to
time upon reasonable prior notice.
(d) Notwithstanding anything to the contrary contained in clause (b)
above, the Loans (including the Notes evidencing such Loans) are registered
obligations and the right, title, and interest of the Lenders and their
assignees in and to such Loans shall be transferable only upon notation of such
transfer in the Register. A Note shall only evidence the Lender's or an
assignee's right, title and interest in and to the related Loan, and in no event
is any such Note to be considered a bearer instrument or obligation. This
Section 11.2 shall be construed so that the Loans are at all times maintained in
"registered form" within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2)
of the Code and any related regulations (or any successor provisions of the Code
or such regulations). Solely for purposes of this and for tax purposes only, the
Administrative Agent shall act as the Borrower's agent for purposes of
maintaining such notations of transfer in the Register.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee, the Administrative Agent shall, if such
Assignment and Acceptance has been completed, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower. Within five Business Days
after its receipt of such notice, the Borrower, at its own expense, shall, if
requested by such assignee, execute and deliver to the Administrative Agent new
Notes to the order of such assignee in an amount equal to the Commitments and
Loans assumed by it pursuant to such Assignment and Acceptance and, if the
assigning Lender has surrendered any Note for exchange in connection with the
assignment and has retained Commitments or Loans hereunder, new Notes to the
order of the assigning Lender in an amount equal to the Commitments and Loans
retained by it hereunder. Such new Notes shall be dated the same date as the
surrendered Notes and be in substantially the form of Exhibit B-1 (Form of
Revolving Credit Note) or Exhibit B-2 (Form of Term Note), as applicable.
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(f) In addition to the other assignment rights provided in this
Section 11.2 each Lender may do each of the following:
(i) grant to a Special Purpose Vehicle the option to make all or
any part of any Loan that such Lender would otherwise be required to make
hereunder and the exercise of such option by any such Special Purpose
Vehicle and the making of Loans pursuant thereto shall satisfy (once and to
the extent that such Loans are made) the obligation of such Lender to make
such Loans thereunder, provided, however, that (x) nothing herein shall
constitute a commitment or an offer to commit by such a Special Purpose
Vehicle to make Loans hereunder and no such Special Purpose Vehicle shall
be liable for any indemnity or other Obligation (other than the making of
Loans for which such Special Purpose Vehicle shall have exercised an
option, and then only in accordance with the relevant option agreement) and
(y) such Lender's obligations under the Loan Documents shall remain
unchanged, such Lender shall remain responsible to the other parties for
the performance of its obligations under the terms of this Agreement and
shall remain the holder of the Obligations for all purposes hereunder; and
(ii) assign, as collateral or otherwise, any of its rights under
this Agreement, whether now owned or hereafter acquired (including rights
to payments of principal or interest on the Loans), to (A) without notice
to or consent of the Administrative Agent or the Borrower, any Federal
Reserve Bank (pursuant to Regulation A of the Federal Reserve Board) and
(B) with notice to the Administrative Agent (but without consent of the
Administrative Agent or the Borrower) (1) any holder of, or trustee for the
benefit of, the holders of such Lender's Securities and (2) any Special
Purpose Vehicle to which such Lender has granted an option pursuant to
clause (i) above;
provided, however, that no such assignment or grant shall release such Lender
from any of its obligations hereunder except as expressly provided in clause (i)
above and except, in the case of a subsequent foreclosure pursuant to an
assignment as collateral, if such foreclosure is made in compliance with the
other provisions of this Section 11.2) other than this clause (f) or clause (g)
below. Each party hereto acknowledges and agrees that, prior to the date that is
one year and one day after the payment in full of all outstanding commercial
paper or other senior debt of any such Special Purpose Vehicle, such party shall
not institute against, or join any other Person in instituting against, any
Special Purpose Vehicle that has been granted an option pursuant to this clause
(f) any bankruptcy, reorganization, insolvency or liquidation proceeding (such
agreement shall survive the payment in full of the Obligations). The terms of
the designation of, or assignment to, such Special Purpose Vehicle shall not
restrict such Lender's ability to, or grant such Special Purpose Vehicle the
right to, consent to any amendment or waiver to this Agreement or any other Loan
Document or to the departure by the Borrower from any provision of this
Agreement or any other Loan Document without the consent of such Special Purpose
Vehicle except, as long as the Administrative Agent and the Lenders, Issuers and
other Secured Parties shall continue to, and shall be entitled to continue to,
deal solely and directly with such Lender in connection with such Lender's
obligations under this Agreement, to the extent any such consent would reduce
the principal amount of, or the rate of interest on, any Obligations, amend this
clause (f) or postpone any scheduled date of payment of such principal or
interest. Each Special Purpose Vehicle shall be entitled to the benefits of
Section 2.14 (Capital Adequacy), Section 2.15 (Taxes) and Section 2.13(d)
(Illegality) as if it were such Lender; provided, however, that anything herein
to the contrary notwithstanding, no Loan Party shall, at any time, be obligated
to
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make under Section 2.14 (Capital Adequacy), Section 2.15 (Taxes) or Section
2.13(d) (Illegality) to any such Special Purpose Vehicle and any such Lender any
payment in excess of the amount the Loan Party would have been obligated to pay
to such Lender in respect of such interest if such Special Purpose Vehicle had
not been assigned the rights of such Lender hereunder.
(g) Each Lender may sell participations to one or more Persons in or
to all or a portion of its rights and obligations under the Loan Documents
(including all its rights and obligations with respect to the Term Loans,
Revolving Loans and Letters of Credit). The terms of such participation shall
not, in any event, require the participant's consent to any amendments, waivers
or other modifications of any provision of any Loan Documents, the consent to
any departure by any Loan Party therefrom, or to the exercising or refraining
from exercising any powers or rights such Lender may have under or in respect of
the Loan Documents (including the right to enforce the obligations of the Loan
Parties), except if any such amendment, waiver or other modification or consent
would (i) reduce the amount, or postpone any date fixed for, any amount (whether
of principal, interest or fees) payable to such participant under the Loan
Documents, to which such participant would otherwise be entitled under such
participation or (ii) result in the release of all or substantially all of the
Collateral other than in accordance with Section 10.8(b) (Concerning the
Collateral and the Collateral Documents). In the event of the sale of any
participation by any Lender, (w) such Lender's obligations under the Loan
Documents shall remain unchanged, (x) such Lender shall remain solely
responsible to the other parties for the performance of such obligations, (y)
such Lender shall remain the holder of such Obligations for all purposes of this
Agreement and (z) the Borrower, the Administrative Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement. Each participant
shall be entitled to the benefits of Sections 2.14 (Capital Adequacy) and
Section 2.15 (Taxes) and of Section 2.13(d) (Illegality) as if it were a Lender
so long as such participant complies with the tax documentation requirements of
Section 2.15 (f) as if it were a Lender; provided, however, that anything herein
to the contrary notwithstanding, no Loan Party shall, at any time, be obligated
to make under Section 2.14 (Capital Adequacy), Section 2.15 (Taxes) or 2.13(d)
(Illegality) to the participants in the rights and obligations of any Lender
(together with such Lender) any payment in excess of the amount such Loan Party
would have been obligated to pay to such Lender thereunder had such
participation not been sold.
(h) Any Issuer may at any time assign its rights and obligations
hereunder to any other Lender by an instrument in form and substance
satisfactory to the Borrower, the Administrative Agent, such Issuer and such
Lender. If any Issuer ceases to be a Lender hereunder by virtue of any
assignment made pursuant to this Section 11.2, then, as of the effective date of
such cessation, such Issuer's obligations to Issue Letters of Credit pursuant to
Section 2.3 (Letters of Credit) shall terminate and such Issuer shall be an
Issuer hereunder only with respect to outstanding Letters of Credit issued prior
to such date.
Section 11.3 Costs and Expenses
(a) Each of Holdings and the Borrower agrees, jointly and severally,
upon demand to pay, or reimburse the Administrative Agent for, all of the
Administrative Agent's reasonable internal and external audit, legal, appraisal,
valuation, filing, document duplication and reproduction and investigation
expenses and for all other reasonable out-of-pocket costs and expenses of every
type and nature (including the reasonable fees, expenses and disbursements of
the Administrative Agent's counsel, Weil, Gotshal & ▇▇▇▇▇▇ LLP, local legal
counsel, auditors, accountants, appraisers, printers, insurance and
environmental advisors, and other consultants and
110
agents but excluding any taxes) incurred by the Administrative Agent in
connection with any of the following: (i) the Administrative Agent's audit and
investigation of Holdings and its Subsidiaries in connection with the
preparation, negotiation or execution of any Loan Document or the Administrative
Agent's periodic audits of Holdings or any of its Subsidiaries, as the case may
be, (ii) the preparation, negotiation, execution or interpretation of this
Agreement (including the satisfaction or attempted satisfaction of any condition
set forth in Article III (Conditions To Loans And Letters Of Credit), any Loan
Document or any proposal letter or commitment letter issued in connection
therewith, or the making of the Loans hereunder, (iii) the creation, perfection
or protection of the Liens under any Loan Document (including any reasonable
fees, disbursements and expenses for local counsel in various jurisdictions),
(iv) the ongoing administration of this Agreement and the Loans, including
consultation with attorneys in connection therewith and with respect to the
Administrative Agent's rights and responsibilities hereunder and under the other
Loan Documents, (v) the protection, collection or enforcement of any Obligation
or the enforcement of any Loan Document, (vi) the commencement, defense or
intervention in any court proceeding relating in any way to the Obligations, any
Loan Party, any of Holdings' Subsidiaries, this Agreement or any other Loan
Document, (vii) the response to, and preparation for, any subpoena or request
for document production with which the Administrative Agent is served or
deposition or other proceeding in which the Administrative Agent is called to
testify, in each case, relating in any way to the Obligations, any Loan Party,
any of Holdings' Subsidiaries, this Agreement or any other Loan Document or
(viii) any amendment, consent, waiver, assignment, restatement, or supplement to
any Loan Document or the preparation, negotiation, and execution of the same.
(b) Each of Holdings and the Borrower further agrees, jointly and
severally, to pay or reimburse the Administrative Agent, the Co-Syndication
Agents, the Arrangers, and each of the Lenders and Issuers upon demand for all
out-of-pocket costs and expenses (excluding any taxes), including reasonable
attorneys' fees (including allocated costs of internal counsel and costs of
settlement), incurred by the Administrative Agent, the Co-Syndication Agents,
the Arrangers, such Lenders or Issuers in connection with any of the following:
(i) in enforcing any Loan Document or Obligation or any security therefor or
exercising or enforcing any other right or remedy available by reason of an
Event of Default, (ii) in connection with any refinancing or restructuring of
the credit arrangements provided hereunder in the nature of a "work-out" or in
any insolvency or bankruptcy proceeding, (iii) in commencing, defending or
intervening in any litigation or in filing a petition, complaint, answer, motion
or other pleadings in any legal proceeding relating to the Obligations, any Loan
Party, any of Holdings' Subsidiaries and related to or arising out of the
transactions contemplated hereby or by any other Loan Document or (iv) in taking
any other action in or with respect to any suit or proceeding (bankruptcy or
otherwise) described in clause (i), (ii) or (iii) above.
Section 11.4 Indemnities
(a) Each of Holdings and the Borrower agrees to jointly and severally
indemnify and hold harmless the Administrative Agent, the Co-Syndication Agents,
the Arrangers, the Lenders and each Issuer and each of their respective
Affiliates, and each of the directors, trustees, officers, employees, agents,
representatives, attorneys, consultants and advisors of or to any of the
foregoing (including those retained in connection with the satisfaction or
attempted satisfaction of any condition set forth in Article III (Conditions To
Loans And Letters Of Credit)) (each such Person being an "Indemnitee") from and
against any and all claims, damages, liabilities, obligations, losses,
penalties, actions, judgments, suits, costs, disbursements
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and expenses of any kind or nature (including fees, disbursements and expenses
of financial and legal advisors to any such Indemnitee but excluding any taxes)
that may be imposed on, incurred by or asserted against any such Indemnitee in
connection with or arising out of any investigation, litigation or proceeding,
whether or not such investigation, litigation or proceeding is brought by any
such Indemnitee or any of its directors, security holders or creditors or any
such Indemnitee, director, security holder or creditor is a party thereto,
whether direct, indirect, or consequential and whether based on any federal,
state or local law or other statutory regulation, securities or commercial law
or regulation, or under common law or in equity, or on contract, tort or
otherwise, in any manner relating to or arising out of this Agreement, any other
Loan Document, any Obligation, any Letter of Credit, or any act, event or
transaction related or attendant to any thereof, or the use or intended use of
the proceeds of the Loans or Letters of Credit or in connection with any
investigation of any potential matter covered hereby (collectively, the
"Indemnified Matters"); provided, however, that neither Holdings nor the
Borrower shall have any obligation under this Section 11.4 to an Indemnitee with
respect to any Indemnified Matter caused by or resulting primarily from the
gross negligence or willful misconduct of that Indemnitee, as determined by a
court of competent jurisdiction in a final non-appealable judgment or order.
Without limiting the foregoing, "Indemnified Matters" include (i) all
Environmental Liabilities and Costs arising from or connected with the past,
present or future operations of Holdings or any of its Subsidiaries involving
any property subject to a Collateral Document, or damage to real or personal
property or natural resources or harm or injury alleged to have resulted from
any Release of Contaminants on, upon or into such property or any contiguous
real estate, (ii) any costs or liabilities incurred in connection with any
Remedial Action concerning Holdings or any of its Subsidiaries, (iii) any costs
or liabilities incurred in connection with any Environmental Lien and (iv) any
costs or liabilities incurred in connection with any other matter under any
Environmental Law, including the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, (49 U.S.C. (S) 9601 et seq.) and
applicable state property transfer laws, whether, with respect to any such
matter, such Indemnitee is a mortgagee pursuant to any leasehold mortgage, a
mortgagee in possession, the successor in interest to Holdings or any of its
Subsidiaries, or the owner, lessee or operator of any property of Holdings or
any of its Subsidiaries by virtue of foreclosure, except, with respect to those
matters referred to in clauses (i), (ii), (iii) and (iv) above, to the extent
(x) incurred following foreclosure by the Administrative Agent, the
Co-Syndication Agents, the Arrangers, the Lenders or any Issuer, or the
Administrative Agent, the Co-Syndication Agents, the Arrangers, the Lenders or
any Issuer having become the successor in interest to Holdings or any of its
Subsidiaries and (y) attributable solely to acts of the Administrative Agent,
the Co-Syndication Agents, the Arrangers, the Lenders or such Issuer or any
agent on behalf of the Administrative Agent, the Co-Syndication Agents, the
Arrangers, the Lenders or such Issuer.
(b) Each of Holdings and the Borrower shall, jointly and severally,
indemnify the Administrative Agent, the Co-Syndication Agents, the Arrangers,
the Lenders and each Issuer for, and hold the Administrative Agent, the
Co-Syndication Agents, the Arrangers, the Lenders and each Issuer harmless from
and against, any and all claims for brokerage commissions, fees and other
compensation made against the Administrative Agent, the Co-Syndication Agents,
the Arrangers, the Lenders and each Issuer for any broker, finder or consultant
with respect to any agreement, arrangement or understanding made by or on behalf
of any Loan Party or any of its Subsidiaries in connection with the transactions
contemplated by this Agreement.
112
(c) Each of Holdings and the Borrower, at the request of any
Indemnitee, shall have the obligation to defend against any investigation,
litigation or proceeding or requested Remedial Action and each of Holdings
and/or the Borrower, in any event, may participate in the defense thereof with
legal counsel of the Borrower's choice. In the event that such Indemnitee
requests Holdings or the Borrower to defend against such investigation,
litigation or proceeding or requested Remedial Action, Holdings and/or the
Borrower shall promptly do so and such Indemnitee shall have the right to have
legal counsel of its choice participate in such defense. No action taken by
legal counsel chosen by such Indemnitee in defending against any such
investigation, litigation or proceeding or requested Remedial Action, shall
vitiate or in any way impair Holdings' or the Borrower's obligation and duty
hereunder to indemnify and hold harmless such Indemnitee.
(d) Each of Holdings and the Borrower agrees that any indemnification
or other protection provided to any Indemnitee pursuant to this Agreement
(including pursuant to this Section 11.4) or any other Loan Document shall (i)
survive payment in full of the Obligations and (ii) inure to the benefit of any
Person that was at any time an Indemnitee under this Agreement or any other Loan
Document.
Section 11.5 Limitation of Liability
(a) Each of Holdings and the Borrower agrees that no Indemnitee shall
have any liability (whether in contract, tort or otherwise) to any Loan Party or
any of their respective Subsidiaries or any of their respective equity holders
or creditors for or in connection with the transactions contemplated hereby and
in the other Loan Documents and Related Documents, except for direct damages (as
opposed to special, indirect, consequential or punitive damages (including,
without limitation, any loss of profits, business or anticipated savings))
determined in a final non-appealable judgment by a court of competent
jurisdiction to have resulted primarily from such Indemnitee's gross negligence
or willful misconduct. Each of Holdings and the Borrower hereby waives, releases
and agrees (each for itself and on behalf of its Subsidiaries) not to ▇▇▇ upon
any such claim for any special, indirect, consequential or punitive damages,
whether or not accrued and whether or not known or suspected to exist in its
favor.
(b) In no event shall any Agent Affiliate have any liability to any
Loan Party, Lender, Issuer or any other Person for damages of any kind,
including direct or indirect, special, incidental or consequential damages,
losses or expenses (whether in tort or contract or otherwise) arising out of any
Loan Party or any Agent Affiliate's transmission of Approved Electronic
Communications through the Internet or any use of the Approved Electronic
Platform, except to the extent such liability of any Agent Affiliate is found in
a final non-appealable judgment by a court of competent jurisdiction to have
resulted primarily form such Agent Affiliate's gross negligence or willful
misconduct.
Section 11.6 Right of Set-off
Upon the occurrence and during the continuance of any Event of Default
each Lender and each Affiliate of a Lender is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender or its
Affiliates to or for the credit or the account of the Borrower against any and
all of the Obligations now or hereafter existing whether or not such Lender
shall have made any demand under this Agreement or any other Loan Document and
even though such Obligations
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may be unmatured. Each Lender agrees promptly to notify the Borrower after any
such set-off and application made by such Lender or its Affiliates; provided,
however, that the failure to give such notice shall not affect the validity of
such set-off and application. The rights of each Lender under this Section 11.6
are in addition to the other rights and remedies (including other rights of
set-off) that such Lender may have.
Section 11.7 Sharing of Payments, Etc.
(a) If any Lender (directly or through an Affiliate thereof) obtains
any payment (whether voluntary, involuntary, through the exercise of any right
of set-off (including pursuant to Section 11.6 (Right of Set-off) or otherwise)
of the Loans owing to it, any interest thereon, fees in respect thereof or
amounts due pursuant to Section 11.3 (Costs and Expenses) or Section 11.4
(Indemnities) (other than payments pursuant to Section 2.13 (Special Provisions
Governing Eurodollar Rate Loans), Section 2.14 (Capital Adequacy) or Section
2.15 (Taxes) or otherwise receives any Collateral or any "Proceeds" (as defined
in the Pledge and Security Agreement) of Collateral (other than payments
pursuant to Section 2.13 (Special Provisions Governing Eurodollar Rate Loans),
Section 2.14 (Capital Adequacy) or Section 2.15 (Taxes) (in each case, whether
voluntary, involuntary, through the exercise of any right of set-off or
otherwise (including pursuant to Section 11.6 (Right of Set-off)) in excess of
its Ratable Portion of all payments of such Obligations obtained by all the
Lenders, such Lender (a "Purchasing Lender") shall forthwith purchase from the
other Lenders (each, a "Selling Lender") such participations in their Loans or
other Obligations as shall be necessary to cause such Purchasing Lender to share
the excess payment ratably with each of them. If all or any portion of any
payment received by a Purchasing Lender is thereafter recovered from such
Purchasing Lender, such purchase from each Selling Lender shall be rescinded and
such Selling Lender shall repay to the Purchasing Lender the purchase price to
the extent of such recovery together with an amount equal to such Selling
Lender's ratable share (according to the proportion of (i) the amount of such
Selling Lender's required repayment in relation to (ii) the total amount so
recovered from the Purchasing Lender) of any interest or other amount paid or
payable by the Purchasing Lender in respect of the total amount so recovered.
(b) The Borrower agrees that any Purchasing Lender so purchasing a
participation from a Selling Lender pursuant to this Section 11.7 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of the Borrower in the amount of such
participation.
Section 11.8 Notices, Etc.
(a) Addresses for Notices. All notices, demands, requests, consents
and other communications provided for in this Agreement shall be given in
writing, or by any telecommunication device capable of creating a written record
(including electronic mail), and addressed to the party to be notified as
follows:
(i) if to Holdings or the Borrower:
A.T. ▇▇▇▇▇▇ Coal Company, Inc.
▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
114
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(ii) if to any Lender or Issuer, at its Domestic Lending Office
specified opposite its name on Schedule II (Applicable Lending Offices and
Addresses for Notices) or on the signature page of any applicable
Assignment and Acceptance; and
(iii) if to the Administrative Agent:
Citicorp North America, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy no: ▇▇▇-▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇.▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
with a copy to:
Weil, Gotshal & ▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy no: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇.▇▇▇
or at such other address as shall be notified in writing (x) in the case of
Holdings or the Borrower, the Administrative Agent, to the other parties and (y)
in the case of all other parties, to the Borrower and the Administrative Agent.
(b) Effectiveness of Notices. All notices, demands, requests, consents
and other communications described in clause (a) above shall be effective (i) if
delivered by hand, including any overnight courier service, upon personal
delivery, (ii) if delivered by mail, when deposited in the mails, (iii) if
delivered by posting to an Approved Electronic Platform, an Internet website or
a similar telecommunication device requiring a user prior access to such
Approved Electronic Platform, website or other device, when such notice, demand,
request, consent and other communication shall have been made generally
available on such Approved Electronic Platform, Internet website or similar
device to the class of Person being notified (regardless of whether any such
Person must accomplish, and whether or not any such Person shall have
accomplished, any action prior to obtaining access to such items, including
registration, disclosure of contact information, compliance with a standard user
agreement or undertaking a duty of confidentiality) and (iv) if delivered by
electronic mail or any other telecommunications device, when transmitted to an
electronic mail address (or by another means of electronic delivery) as provided
in clause (a) above; provided, however, that notices and communications to the
Administrative Agent pursuant to Article II (The Facilities) or Article X (The
Administrative Agent) shall not be effective until received by the
Administrative Agent.
(c) Use of Electronic Platform. Notwithstanding clauses (a) and (b)
above (unless the Administrative Agent requests that the provisions of clause
(a) and (b) above be
115
followed) and any other provision in this Agreement or any other Loan Document
providing for the delivery of, any Approved Electronic Communication by any
other means, the Loan Parties shall deliver all Approved Electronic
Communications to the Administrative Agent by properly transmitting such
Approved Electronic Communications electronically (in a format acceptable to the
Administrative Agent) to ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇ or such other electronic
mail address (or similar means of electronic delivery) as the Administrative
Agent may notify the Borrower. Nothing in this clause (c) shall prejudice the
right of the Administrative Agent or any Lender or Issuer to deliver any
Approved Electronic Communication to any Loan Party in any manner authorized in
this Agreement.
Section 11.9 No Waiver; Remedies
No failure on the part of any Lender, Issuer or the Administrative
Agent to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
Section 11.10 Binding Effect
This Agreement shall become effective when it shall have been executed
by Holdings, the Borrower and the Administrative Agent and when the
Administrative Agent shall have been notified by each Lender and Issuer that
such Lender or Issuer has executed it and thereafter shall be binding upon and
inure to the benefit of Holdings, the Borrower, the Administrative Agent and
each Lender and Issuer and, in each case, their respective successors and
assigns; provided, however, that neither Holdings nor the Borrower shall not
have the right to assign its rights hereunder or any interest herein without the
prior written consent of the Lenders.
Section 11.11 Governing Law
This Agreement and the rights and obligations of the parties hereto
shall be governed by, and construed and interpreted in accordance with, the law
of the State of New York.
Section 11.12 Submission to Jurisdiction; Service of Process
(a) Any legal action or proceeding with respect to this Agreement or
any other Loan Document may be brought in the courts of the State of New York or
of the United States of America for the Southern District of New York, and, by
execution and delivery of this Agreement, each of Holdings and the Borrower
hereby accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The parties hereto
hereby irrevocably waive any objection, including any objection to the laying of
venue or based on the grounds of forum non conveniens, that any of them may now
or hereafter have to the bringing of any such action or proceeding in such
respective jurisdictions.
(b) Each of Holdings and the Borrower hereby irrevocably consents to
the service of any and all legal process, summons, notices and documents in any
suit, action or proceeding brought in the United States of America arising out
of or in connection with this Agreement or any other Loan Document by the
mailing (by registered or certified mail, postage prepaid) or delivering of a
copy of such process to the Borrower at its address specified in Section 11.8
(Notice, Etc.). Each of Holdings and the Borrower agrees that a final judgment
in
116
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
(c) Nothing contained in this Section 11.12 shall affect the right of
the Administrative Agent, any Lender or any Issuer to serve process in any other
manner permitted by law or commence legal proceedings or otherwise proceed
against Holdings, the Borrower or any other Loan Party in any other
jurisdiction.
(d) If for the purposes of obtaining judgment in any court it is
necessary to convert a sum due hereunder in Dollars into another currency, the
parties hereto agree, to the fullest extent that they may effectively do so,
that the rate of exchange used shall be that at which in accordance with normal
banking procedures the Administrative Agent could purchase Dollars with such
other currency at the spot rate of exchange quoted by the Administrative Agent
at 11:00 a.m. (New York time) on the Business Day preceding that on which final
judgment is given, for the purchase of Dollars, for delivery two Business Days
thereafter.
Section 11.13 Waiver of Jury Trial
EACH OF THE ADMINISTRATIVE AGENT, THE LENDERS, THE ISSUERS, HOLDINGS
AND THE BORROWER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT.
Section 11.14 Marshaling; Payments Set Aside
None of the Administrative Agent, any Lender or any Issuer shall be
under any obligation to marshal any assets in favor of a Loan Party or any other
party or against or in payment of any or all of the Obligations. To the extent
that a Loan Party makes a payment or payments to the Administrative Agent, the
Lenders or the Issuers or any such Person receives payment from the proceeds of
the Collateral or exercise their rights of setoff, and such payment or payments
or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party, then to the
extent of such recovery, the obligation or part thereof originally intended to
be satisfied, and all Liens, right and remedies therefor, shall be revived and
continued in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.
Section 11.15 Section Titles
The section titles contained in this Agreement are and shall be
without substantive meaning or content of any kind whatsoever and are not a part
of the agreement between the parties hereto, except when used to reference a
section. Any reference to the number of a clause, sub-clause or subsection
hereof immediately followed by a reference in parenthesis to the title of the
Section containing such clause, sub-clause or subsection is a reference to such
clause, sub-clause or subsection and not to the entire Section; provided,
however, that, in case of direct conflict between the reference to the title and
the reference to the number of such Section, the reference to the title shall
govern absent manifest error. If any reference to the number of a Section (but
not to any clause, sub-clause or subsection thereof) is followed immediately by
a reference in parenthesis to the title of a Section, the title reference shall
govern in case of direct conflict absent manifest error.
117
Section 11.16 Execution in Counterparts
This Agreement may be executed in any number of counterparts and by
different parties 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. Signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are attached to the same document. Delivery of an executed signature page of
this Agreement by facsimile transmission shall be as effective as delivery of a
manually executed counterpart hereof. A set of the copies of this Agreement
signed by all parties shall be lodged with the Borrower and the Administrative
Agent.
Section 11.17 Entire Agreement
This Agreement, together with all of the other Loan Documents and all
certificates and documents delivered hereunder or thereunder, embodies the
entire agreement of the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof. In the event of any
conflict between the terms of this Agreement and any other Loan Document, the
terms of this Agreement shall govern.
Section 11.18 Confidentiality.
Neither the Lenders nor any of the Agents may disclose to any Person
any confidential, proprietary or non-public information of Holdings or the
Borrower either furnished to the Lenders or the Agents by either Holdings or the
Borrower (such information being referred to collectively herein as the
"Borrower Information"), except that each of the Lenders and the Agents may
disclose Borrower Information (i) to its and its Affiliates' employees,
officers, directors, agents and advisors (it being understood that the Persons
to whom such disclosure is made will be informed of the confidential nature of
such Borrower Information and instructed to keep such Borrower Information
confidential on substantially the same terms as provided herein), (ii) to the
extent requested by any regulatory authority, (iii) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (iv)
to any other party to this Agreement, (v) if reasonably necessary in connection
with the exercise of any remedies hereunder or under any other Loan Document or
any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (vi) subject to
an agreement containing provisions substantially the same as those of this
Section 11.18, to any assignee of or participant in, or any prospective assignee
of or participant in, any of its rights or obligations under this Agreement,
(vii) to the extent such Borrower Information (A) is or becomes generally
available to the public on a non-confidential basis other than as a result of a
breach of this Section 11.18 by such Agent or such Lender, or (B) is or becomes
available to such Agent or such Lender on a non-confidential basis from a source
other than the Holdings or the Borrower and (viii) with the prior written
consent of Holdings or the Borrower. Neither of Holdings nor the Borrower may
disclose to any Person the amount or terms of any fees payable to any of the
Agents or any Lender (such information being collectively referred to herein as
the "Facility Information"), except that either of Holdings or the Borrower may
disclose the Facility Information (i) to its and its respective Affiliates'
employees, officers, directors, agents and advisors who have a need to know the
Facility Information in connection with this Agreement and the transactions
contemplated hereby or (ii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process. Notwithstanding any
other provision in this Agreement, all parties hereto hereby agree that each
party (and each of their respective employees, representatives and agents and
each of the officers, directors, employees, accountants,
118
attorneys and other advisors of any of them) may disclose to any and all
persons, without limitation of any kind, the tax treatment and tax structure of
the Facilities and the transactions contemplated hereby and all materials of any
kind (including opinions and other tax analyses) that are provided to any of
them relating to such tax treatment and tax structure.
[Signature Pages Follow]
119
In Witness Whereof, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized, as of the
date first above written.
A.T. ▇▇▇▇▇▇ Coal Company, Inc.,
as Borrower
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Title: Vice President and Treasurer
▇▇▇▇▇▇ Energy Company,
as Holdings
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Title: Vice President and Treasurer
Citicorp North America, Inc.,
as Administrative Agent and Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
UBS Securities LLC,
as Co-Syndication Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
Title: Director
PNC Bank, National Association,
as Co-Syndication Agent, Lender and
Issuer
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: SVP
Lenders:
UBS AG, Cayman Islands Branch
By: /s/ ▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
Title: Director
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Associate Director