Exhibit 10.20
AMENDMENT NO. 1 to CREDIT AGREEMENT
Dated as of April 30, 2001
This AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "Agreement") is among
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PEABODY ENERGY CORPORATION (formerly known as P&L Coal Holdings Corporation), a
Delaware corporation (the "Borrower"), the Lenders (as defined below), and BANK
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ONE, NA (formerly known as The First National Bank of Chicago), as
administrative agent (in such capacity, the "Administrative Agent").
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PRELIMINARY STATEMENTS:
1. The Borrower, the Lenders and the Administrative Agent have
entered into that certain Amended and Restated Credit Agreement, dated as of
June 9, 1998, by and among the Borrower, the several lenders from time to time
parties thereto (the "Lenders"), ▇▇▇▇▇▇ Commercial Paper Inc., as syndication
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agent, ▇▇▇▇▇▇ Brothers Inc., as arranger, the Administrative Agent, and Bank of
America National Trust & Savings Association and The Fuji Bank, Limited, as
documentation agents (the "Credit Agreement"; capitalized terms used and not
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otherwise defined herein have the meanings assigned to such terms in the Credit
Agreement).
2. The Borrower has informed the Lenders that it wishes to amend
certain provisions of the Credit Agreement, as more particularly described
below, in connection with the Borrower's recently announced initial public
offering of common stock (the "IPO").
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3. Subject to the terms and conditions set forth below, and in
consideration of certain agreements of the Borrower and the other Credit Parties
set forth herein, the Required Lenders are willing to agree to the amendments
described below.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Amendments to Credit Agreement. Upon the terms and subject to
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the conditions set forth in this Agreement and in reliance on the
representations and warranties of the Borrower set forth in this Agreement, the
Borrower and the Required Lenders hereby agree to the following amendments to
the Credit Agreement:
a. Section 1.1 of the Credit Agreement is hereby amended by
adding the following definitions in proper alphabetical order:
1. ""Amendment No. 1" means that certain Amendment
No. 1 to Credit Agreement, dated as of April 30, 2001, among the
Borrower, the Lenders, and the Administrative Agent."
2. ""Amendment No.1 Effective Date" means the date
on which all of the conditions precedent to the effectiveness of
Amendment No. 1 have been satisfied."
3. ""IPO" means the initial public offering of
common stock by the Borrower."
b. Section 1.1 of the Credit Agreement is hereby further
amended as follows:
1. The definition of "Consolidated Cash Interest
Expense" is hereby amended by adding the following to the end thereof:
"; provided, further, that for purposes of determining compliance with
Section 7.1(b), Consolidated Cash Interest Expense shall be calculated
after giving pro forma effect to any repayments of Indebtedness made
with proceeds of the IPO."
2. The definition of "Revolving Loan Sublimit" is
hereby amended by deleting the figure "$200,000,000" and replacing it
with the figure "$350,000,000" on the second line thereof.
c. Section 6.10(d) of the Credit Agreement is hereby
amended by adding the following proviso to the end thereof: "; provided,
further, that from and after the Amendment No. 1 Effective Date, Title
Policies and Title Opinions not yet delivered to the Administrative
Agent as of the Amendment No. 1 Effective Date will no longer be
required to be delivered to the Administrative Agent in connection with
Mortgages required to be delivered pursuant to Sections 6.10(c)(i),
(ii), (iii) and (iv), it being understood that existing Title Policies
must remain in full force and effect."
d. Section 7.1(a) of the Credit Agreement is hereby amended
by replacing the chart contained therein with the following chart:
Fiscal Quarter Ending Ratio
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6/30/01 4.00
9/30/01 4.00
12/31/01 4.00
3/31/02 4.00
6/30/02 4.00
9/30/02 4.00
12/31/02 4.00
3/31/03 3.75
6/30/03 3.75
9/30/03 3.75
12/31/03 3.75
3/31/04 3.50
Thereafter 3.50
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e. Section 7.1(b) of the Credit Agreement is hereby amended
by replacing the chart therein with the following chart:
Fiscal Quarter Ending Ratio
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6/30/01 2.25
9/30/01 2.25
12/31/01 2.25
3/31/02 2.25
6/30/02 2.25
9/30/02 2.25
12/31/02 2.25
3/31/03 2.50
Thereafter 2.50
f. Section 7.7(a) of the Credit Agreement is hereby amended
and restated in its entirety as follows:
"(a) Declare or pay, directly or indirectly, any
dividend or make any other distribution (by reduction of capital or
otherwise), whether in cash, property, securities or a combination
thereof, with respect to any shares of its Capital Stock or directly or
indirectly redeem, purchase, retire or otherwise acquire for value (or
permit any Subsidiary to purchase or acquire) any shares of any class of
its Capital Stock or set aside any amount for any such purpose, except
that, following consummation of the IPO, so long as no Default or Event
of Default has occurred and is continuing, the Borrower may pay
dividends on its common stock in an amount not to exceed (i) $25,000,000
during fiscal year 2002 and (ii) for each fiscal year thereafter, the
greater of (x) 10% of Consolidated EBITDA for such fiscal year and (y)
$25,000,000; provided, however, that any Restricted Subsidiary may
declare and pay dividends or make other distributions to the Borrower or
another Subsidiary that is a Credit Party."
g. Section 7.9(k) of the Credit Agreement is hereby amended
by adding the clause "(i) Investments in Joint Ventures in existence on the
Amendment No. 1 Effective Date and set forth on Schedule 1(f) to Amendment No.1
and (ii) in addition to the Investments permitted under clause (i) hereof," at
the beginning thereof.
h. Section 7.9 of the Credit Agreement is hereby further
amended by deleting the "and" at the end of clause (p) thereof and adding at the
end of such Section, immediately after the figure "$50,000,000" in clause (q),
the following: "; and (r) so long as no Event of Default has occurred and is
continuing, Investments consisting of purchases of Senior Notes and Subordinated
Notes pursuant to the provisions of Section 7.10(a)"
i. Section 7.10(a) of the Credit Agreement is hereby
amended and restated in its entirety as follows:
"(a) Make any optional payment or prepayment on or
redemption or purchase of, or deliver any funds to any trustee for the
prepayment, redemption or
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defeasance of, the Senior Notes or the Subordinated Notes (whether upon
acceleration of the maturity thereof, upon a "Change of Control" (as defined
in the Senior Notes Indenture or the Subordinated Notes Indenture) or
otherwise), provided, however, that proceeds from the IPO in excess of an
amount necessary to repay in full all Term Loans then outstanding may be used
to prepay, redeem, purchase, repurchase, defease or discharge the Senior Notes
and/or the Subordinated Notes; provided that the Term Loans are previously or
simultaneously repaid in full in cash, or (b) amend, modify or change, or
consent or agree to any amendment, modification or change to any of the
material terms of any Senior Notes Documents or Subordinated Notes Documents
(other than any such amendment, modification or change which would extend the
maturity or reduce the amount of any payment of principal thereof or which
would reduce the rate or extend the date for payment of interest thereon)."
2. Conditions to Effectiveness. The effectiveness of this Agreement is
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conditioned upon satisfaction of the following conditions precedent:
a. the Administrative Agent shall have received signed written
authorization from the Required Lenders to execute this Agreement, and shall
have received counterparts of this Agreement signed by the Borrower and of the
Consent of Credit Parties attached hereto (the "Consent") signed by the Credit
Parties;
b. each of the representations and warranties in Section 3 below
shall be true and correct in all material respects;
c. after giving effect to the amendments set forth in Section 1
hereof, no Default or Event of Default shall have occurred and be continuing
under the Credit Agreement or any other Credit Document;
d. the Administrative Agent shall have received payment in
immediately available funds of all expenses incurred by the Administrative Agent
(including, without limitation, legal fees) for which invoices have been
presented, on or before the Amendment No. 1 Effective Date;
e. the Administrative Agent shall have received legal opinions from
the general counsel to the Borrower and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, New York
counsel to the Borrower, in form and substance reasonably satisfactory to the
Administrative Agent, dated as of the Amendment No. 1 Effective Date and
addressed to each of the Administrative Agent, the Syndication Agent, the
Arranger, the Documentation Agents and the Lenders, as to the enforceability of
this Agreement and the Credit Agreement (as amended hereby) and related
corporate matters;
f. the Administrative Agent shall have received satisfactory
evidence that the execution, delivery and performance of this Agreement
(including, without limitation, the amendments to the Credit Agreement contained
herein) have been duly approved by all necessary corporate action of the
Borrower;
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g. the Administrative Agent shall have received written
confirmation from the Persons issuing the existing Title Policies that such
Title Policies shall remain in full force and effect after giving effect to this
Agreement;
h. the Borrower shall have received at least $250,000,000 in gross
cash proceeds from the IPO; and
i. the Administrative Agent shall have received, for the account of
each Lender who consents to this Agreement in writing on or prior to April 30,
2001, a consent fee equal to 0.25% of the sum of the Revolving Credit
Commitments and Term Loans of such Lender outstanding on such date.
3. Representations and Warranties. The Borrower represents and warrants
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to the Administrative Agent and the Lenders as follows:
a. Authority. Each of the Credit Parties has the requisite
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corporate power and authority to execute and deliver this Agreement and the
Consent, as applicable, and to perform its obligations hereunder and under the
Credit Agreement (as modified hereby). The execution, delivery and performance
by the Borrower and each other Credit Party of this Agreement, the Consent (as
applicable), the Credit Agreement (as modified hereby) and the transactions
contemplated hereby and thereby have been duly approved by all necessary
corporate action of such Person and no other corporate proceedings on the part
of each such Person are necessary to consummate such transactions (except as
expressly contemplated hereby and thereby).
b. Enforceability. This Agreement has been duly executed and
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delivered by the Borrower. The Consent has been duly executed and delivered by
each Credit Party. This Agreement, the Consent and each Credit Document (as
modified hereby) is the legal, valid and binding obligation of each Credit Party
hereto and thereto, enforceable against such Credit Party in accordance with its
terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing, and is in full force and effect.
c. Representations and Warranties. The representations and
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warranties contained in each Credit Document (other than any such
representations and warranties that, by their terms, are specifically made as of
a date other than the date hereof) are true and correct in all material respects
on and as of the date hereof as though made on and as of the date hereof.
d. No Default. After giving effect to the amendments set forth in
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Section 1 hereof, no event has occurred and is continuing that constitutes a
Default or Event of Default.
4. Reference to and Effect on Credit Agreement.
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a. Upon and after the effectiveness of this Agreement, each
reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or
words of like import referring to the Credit Agreement, and each reference in
the other Credit Documents to "the Credit
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Agreement", "thereunder", "thereof" or words of like import referring to the
Credit Agreement, shall mean and be a reference to the Credit Agreement as
modified hereby.
b. Except as specifically modified above, the Credit Agreement and
the other Credit Documents are and shall continue to be in full force and effect
and are hereby in all respects ratified and confirmed. Without limiting the
generality of the foregoing, the Security Documents and all of the Collateral
described therein do and shall continue to secure the payment of all Obligations
under and as defined therein, in each case as modified hereby.
c. The execution, delivery and effectiveness of this Agreement
shall not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of the Administrative Agent or any Lender under any of
the Credit Documents, nor, except as expressly provided herein, constitute a
waiver or amendment of any provision of any of the Credit Documents.
5. Counterparts. This Agreement may be executed in any number of
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counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all
of which taken together shall constitute one and the same agreement. Delivery
of an executed counterpart of a signature page to this Agreement by facsimile
shall be effective as delivery of a manually executed counterpart of this
Agreement.
6. Severability. Any provision of this Agreement that is prohibited or
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unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
7. Governing Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of the State of New York.
[Signature Pages Follow]
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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 written above.
PEABODY ENERGY CORPORATION (f/k/a P&L Coal
Holdings Corporation),
a Delaware corporation
By:
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Name:
Title:
BANK ONE, NA (f/k/a The First National Bank of
Chicago),
as Administrative Agent, on behalf of the
Required Lenders
By:
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Name:
Title:
Schedule 1(f)
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JOINT VENTURES EXISTING
AS OF AMENDMENT NO. 1 EFFECTIVE DATE
Black Beauty Coal Company and Affiliates (see note below):
. Black Beauty Coal Company
[ ] Black Beauty Underground, Inc.
[ ] Black Beauty Mining, Inc.
[ ] GIBCO Motor Express, Inc.
[ ] GIBCO Motor Express, LLC
[ ] United Minerals Company, LLC
[_] Kentucky United, LLC (▇▇▇▇▇▇)
[ ] Enterprise Mine, LLC
[ ] SCC Holding LLC
[ ] Sugar Camp Coal, LLC
[_] Black Beauty Illinois, LLC
[_] Arclar Company, LLC
. Black Beauty Equipment Company
[ ] Sugar Camp Properties
. Eagle Coal Company
. Falcon Coal Company
Kanawha Eagle Coal, LLC
Note: Black Beauty Coal Company and affiliates were treated as joint venture
investments for purposes of Section 7.9(k) pursuant to the Consent and Waiver
dated as of March 2, 1999.
CONSENT OF CREDIT PARTIES
Dated as of April 30, 2001
The undersigned, as Guarantors and as Grantors under the "Guarantee and
Collateral Agreement" and as Grantors under the "Trademark Security Agreement"
and each "Patent Security Agreement" (as such terms are defined in and under the
Credit Agreement referred to in the foregoing Amendment No. 1), each hereby
consents and agrees to the foregoing Amendment No. 1 and hereby confirms and
agrees that (i) each of the Guarantee and Collateral Agreement, Trademark
Security Agreement and each Patent Security Agreement is, and shall continue to
be, in full force and effect and is hereby ratified and confirmed in all
respects except that, upon the effectiveness of, and on and after the date of,
said Amendment No. 1, each reference in the Guarantee and Collateral Agreement,
the Trademark Security Agreement and each Patent Security Agreement to the
"Credit Agreement", "thereunder", "thereof" and words of like import referring
to the Credit Agreement, shall mean and be a reference to the Credit Agreement
as modified by said Amendment No. 1, (ii) the Guarantee and Collateral Agreement
and all of the Collateral described therein does, and shall continue to, secure
the payment of all of the Obligations as defined in the Guarantee and Collateral
Agreement, (iii) the Trademark Security Agreement and all of the Collateral
described therein does, and shall continue to, secure the payment of all of the
Obligations as defined in the Guarantee and Collateral Agreement and (iv) each
Patent Security Agreement and all of the Collateral described therein does, and
shall continue to, secure the payment of all of the Obligations as defined in
the Guarantee and Collateral Agreement.
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have caused this Consent of
Credit Parties to be executed by their respective officers thereunto duly
authorized, as of the date first written above.
PEABODY ENERGY CORPORATION (f/k/a P&L Coal Holdings
Corporation)
AFFINITY MINING COMPANY
ARID OPERATIONS, INC.
BIG SKY COAL COMPANY
BLUEGRASS COAL COMPANY
CABALLO COAL COMPANY
▇▇▇▇▇▇▇ COAL COMPANY
▇▇▇▇▇▇▇ COAL COMPANY
COAL PROPERTIES CORP.
COLONY BAY COAL COMPANY
▇▇▇▇ MOUNTAIN COAL COMPANY
COTTONWOOD LAND COMPANY
DARIUS GOLD MINE, INC.
EACC CAMPS, INC.
EASTERN ASSOCIATED COAL CORP.
EASTERN ROYALTY CORP.
▇▇▇▇▇ FINANCE COMPANY
GOLD FIELDS CHILE, S.A.
GOLD FIELDS MINING CORPORATION
GOLD FIELDS OPERATING COMPANY ▇▇▇▇▇
GRAND EAGLE MINING, INC.
HAYDEN GULCH TERMINAL, INC.
HIGHLAND MINING COMPANY
HILLSIDE MINING COMPANY
INDEPENDENCE MATERIAL HANDLING
COMPANY
INTERIOR HOLDINGS CORP.
▇▇▇▇▇ RIVER COAL TERMINAL COMPANY
JUNIPER COAL COMPANY
KAYENTA MOBILE HOME PARK, INC.
▇▇▇▇▇▇▇▇ COAL COMPANY
MIDCO SUPPLY AND EQUIPMENT
CORPORATION
MIDWEST COAL RESOURCES, INC.
MOUNTAIN VIEW COAL COMPANY
NORTH PAGE COAL CORPORATION
By:______________________________________
Name:
Title:
OHIO COUNTY COAL COMPANY
PATRIOT COAL COMPANY, ▇.▇.
▇▇▇▇▇▇▇ AMERICA, INC.
PEABODY COAL COMPANY
PEABODY COAL SALES COMPANY
PEABODY COALTRADE, INC.
PEABODY DEVELOPMENT COMPANY
PEABODY DEVELOPMENT LAND HOLDINGS,
LLC
PEABODY ENERGY SOLUTIONS, INC
PEABODY HOLDING COMPANY, INC.
PEABODY NATURAL GAS, LLC
PEABODY NATURAL RESOURCES COMPANY
PEABODY SOUTHWESTERN COAL COMPANY
PEABODY TERMINALS, INC.
PEABODY WESTERN COAL COMPANY
PEABODY VENEZUELA COAL CORP.
PINE RIDGE COAL COMPANY
PORCUPINE PRODUCTION, LLC
PORCUPINE TRANSPORTATION, LLC
POWDER RIVER COAL COMPANY
RIO ESCONDIDO COAL CORP.
RIVERS EDGE MINING, INC.
SENECA COAL COMPANY
SENTRY MINING COMPANY
SNOWBERRY LAND COMPANY
STERLING SMOKELESS COAL COMPANY
By:______________________________________
Name:
Title:
THOROUGHBRED, L.L.C.
By: Peabody Holding Company, its Manager
By:______________________________________
Name:
Title:
