AMENDED AND RESTATED CREDIT AGREEMENT dated as of June 26, 2008 among NEW EARTH LNG, LLC, as Borrower, PNG VENTURES, INC., as Parent and APPLIED LNG TECHNOLOGIES USA, L.L.C. FLEET STAR, INC. EARTH LEASING, INC. ARIZONA LNG, L.L.C. as Loan Parties, THE...
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____________________________________________________
AMENDED
AND RESTATED CREDIT AGREEMENT
dated as
of June 26, 2008
among
NEW EARTH
LNG, LLC,
as
Borrower,
PNG
VENTURES, INC.,
as
Parent
and
APPLIED
LNG TECHNOLOGIES USA, L.L.C.
FLEET
STAR, INC.
EARTH
LEASING, INC.
ARIZONA
LNG, L.L.C.
as Loan
Parties,
THE
FINANCIAL INSTITUTIONS PARTY HERETO,
as
Lenders,
and
FOURTH
THIRD LLC
as Agent
and Sole Lead Arranger
____________________________________________________
____________________________________________________
TABLE
OF CONTENTS
Page
Section
1. Definitions;
Interpretation.
1.1. Definitions.
1.2. Interpretation.
Section
2. Credit
Facilities.
2.1. Commitments.
2.2. Omitted.
2.3. Loan
Accounting.
2.3.1. Recordkeeping.
2.3.2. Notes.
2.4. Interest.
2.4.1. Interest
Rates.
2.4.2. Interest Payment
Dates.
2.4.3. Setting and Notice of LIBOR
Rates.
2.4.4. Computation of
Interest.
2.5. Fees.
2.5.1. Fourth Third’s
Fees.
2.6. Prepayment.
2.6.1. Voluntary
Prepayment.
2.6.2. Mandatory
Prepayment.
2.6.3. All
Prepayments.
2.7. Repayment
2.8. Payment.
2.8.1. Making of
Payments.
2.8.2. Application of Payments and
Proceeds.
2.8.3. Payment
Dates.
2.8.4. Set-off. [
2.8.5. Proration of
Payments.
Section
3. Yield
Protection.
3.1. Taxes.
3.2. Increased
Cost.
3.3. Funding
Losses.
3.4. Manner of Funding; Alternate
Funding Offices.
3.5. Mitigation of Circumstances;
Replacement of Lenders.
3.6. Conclusiveness of
Statements; Survival.
Section
4. Conditions
Precedent.
4.1. Credit
Extension.
4.1.1. Omitted.
4.1.2. Omitted.
4.1.3. Interest and
Fees.
4.1.4. Delivery of Loan
Documents.
4.1.5. Representations and
Warranties
4.1.6. No
Default
4.1.7. Diligence
4.1.8. No Material Adverse
Change
4.1.9. Reservation of
Shares
4.1.10. Drop Down and Share
Exchange
Section
5. Representations and
Warranties.
5.1. Organization.
5.2. Authorization; No
Conflict.
5.3. Validity; Binding
Nature.
5.4. Financial
Condition.
5.5. No Material Adverse
Change.
5.6. Litigation
5.7. Ownership of Properties;
Liens.
5.8. Capitalization.
5.9. Pension
Plans.
5.10. Compliance with Law;
Investment Company Act; Other Regulated Entities.
5.11. Margin
Stock.
5.12. Taxes.
5.13. Solvency.
5.14. Environmental
Matters.
5.15. Insurance.
5.16. Information.
5.17. Intellectual
Property.
5.18. Labor
Matters.
5.19. No
Default.
5.20. Foreign Assets Control
Regulations and Anti-Money Laundering.
5.20.1. OFAC.
5.20.2. Patriot
Act
5.21. Gas Supply and Hedge
Contracts.
Section
6. Affirmative
Covenants.
6.1. Information.
6.1.1. Annual
Report.
6.1.2. Interim
Reports.
6.1.3. Compliance
Certificate.
6.1.4. Reports to SEC and
Shareholders.
6.1.5. Notice of Default;
Litigation; ERISA Matters.
6.1.6. Management
Report.
6.1.7. Projections.
6.1.8. Other
Information.
6.2. Books; Records;
Inspections.
6.3. Maintenance of Property;
Insurance.
6.4. Compliance with Laws;
Payment of Taxes and Liabilities.
6.5. Maintenance of
Existence.
6.6. Employee Benefit
Plans.
6.7. Environmental
Matters.
6.8. Further
Assurances.
6.9. Collateral Access
Agreements.
6.10. Board Observation
Rights.
Section
7. Negative
Covenants.
7.1. Debt.
7.2. Liens.
7.3. Subsidiaries.
7.4. Restricted
Payments.
7.5. Mergers; Consolidations;
Asset Sales.
7.6. Modification of
Organizational Documents.
7.7. Use of
Proceeds.
7.8. Transactions with Affiliates
and Former Affiliates.
7.9. Inconsistent
Agreements.
7.10. Business
Activities.
7.11. Investments.
7.12. Omitted.
7.13. Fiscal
Year.
7.14. Financial
Covenants.
7.14.1. Fixed Charge Coverage
Ratio.
7.14.2. EBITDA.
7.14.3. Capital
Expenditures
7.15. Deposit Accounts and
Securities Accounts.
7.16. Sale-Leasebacks
7.17. Hazardous
Substances
Section
8. Events of Default;
Remedies.
8.1. Events of
Default.
8.1.1. Non-Payment of
Credit.
8.1.2. Default Under Other
Debt.
8.1.3. Bankruptcy;
Insolvency.
8.1.4. Non-Compliance with Loan
Documents.
8.1.5. Representations;
Warranties.
8.1.6. Pension
Plans.
8.1.7. Judgments.
8.1.8. Invalidity of Collateral
Documents.
8.1.9. Invalidity of Intercreditor
Provisions.
8.1.10. Change of
Control.
8.1.11. Gas Supply and Hedge
Contracts.
8.2. Remedies.
Section
9. Agent.
9.1. Appointment;
Authorization.
9.2. Delegation of
Duties.
9.3. Limited
Liability.
9.4. Reliance.
9.5. Notice of
Default.
9.6. Credit
Decision.
9.7. Indemnification.
9.8. Agent
Individually.
9.9. Successor
Agent.
9.10. Collateral
Matters.
Section
10.
Miscellaneous.
10.1. Waiver;
Amendments.
10.2. Notices.
10.3. Computations.
10.4. Costs;
Expenses.
10.5. Indemnification by
Borrower.
10.6. Marshaling; Payments Set
Aside.
10.7. Nonliability of
Lenders.
10.8. Assignments;
Participations.
10.8.1. Assignments.
10.8.2. Participations
10.9. Confidentiality.
10.10. Captions.
10.11. Nature of
Remedies.
10.12. Counterparts.
10.13. Severability.
10.14. Entire
Agreement.
10.15. Successors;
Assigns.
10.16. Governing
Law.
10.17. Forum Selection; Consent to
Jurisdiction.
10.18. Waiver of Jury
Trial.
10.19. Collateral
Agent.
Annexes
Annex
I Commitments
and Pro Rata Shares
Annex
II Addresses
Exhibits
Exhibit
A Form
of Assignment Agreement
Exhibit
B Form
of Compliance Certificate
Exhibit
C Form
of Note
Exhibit
D Form
of Excess Cash Flow Certificate
Schedules
Schedule
4.1 Prior
Debt
Schedule
5.6 Litigation
Schedule
5.8 Capitalization
Schedule
5.12 Taxes
Schedule
5.14 Environmental
Matters
Schedule
5.15 Insurance
Schedule
5.18 Labor
Matters
Schedule
7.1 Existing
Debt
Schedule
7.2 Existing
Liens
Schedule
7.11 Existing
Investments
Schedule
7.15 Bank
Accounts
AMENDED
AND RESTATED CREDIT AGREEMENT
Amended and Restated Credit Agreement
dated as of June __, 2008 (as amended, restated or otherwise modified from time
to time, this “Agreement”) among NEW
EARTH LNG, LLC, a Delaware limited liability company (“Borrower”), PNG
VENTURES, INC., a Nevada corporation (“PNG” or “Parent”), the other
Loan Parties named herein, the financial institutions party hereto from time to
time (“Lenders”) and Fourth
Third LLC, a Delaware limited liability company (in its individual capacity,
“Fourth
Third”), as Sole Lead Arranger and Agent for all Lenders.
Heretofore, Earth LNG, Inc., a Texas
corporation (“Old
Earth”), its then parent company, EARTH BIOFUELS, INC., a Delaware
corporation (“EBOF”), certain
Subsidiaries of Old Earth, Lenders and Agent made and entered into a certain
Credit Agreement, dated as of February 28, 2007 (which, as amended or modified
to date, is herein called the “Original Credit
Agreement”) pursuant to which Lenders, acting through Agent, agreed to
extend credit to Old Earth subject to the terms and conditions set forth
therein, including a continuing guaranty from EBOF and the pledge of its capital
stock in Old Earth. Effective this date, Old Earth has transferred
all, or substantially all, of its assets, inclusive of all of its membership
interests in its existing Subsidiaries, to Borrower, and Borrower has assumed
all liabilities of Old Earth to Lenders and Agent under the Original Credit
Agreement (the “Drop
Down”), which Borrower acknowledges pursuant hereto; and, in connection
therewith, PNG, EBOF and Old Earth have entered into a Share Exchange Agreement,
dated as of June __, 2008 (which, as amended or modified from time to time, is
called herein the “Share Exchange
Agreement”) pursuant to which, effective this date, Old Earth has
exchanged all of its membership interests in Borrower for certain capital stock
in PNG (the “Share
Exchange”), resulting in Events of Default under the Original Credit
Agreement unless the Drop Down and the Share Exchange are consented to by
Lenders. Borrower has requested that Lenders give their consent to
the Drop Down and the Share Exchange, and to the release of EBOF, Old Earth and
▇▇▇▇▇▇ from their obligations under the Original Credit Agreement and the
Amended and Restated Guarantee and Collateral Agreement; and, in addition
thereto, that Lenders extend additional credit to Borrower and that the Lenders
make certain other modifications to the terms of the Original Credit Agreement,
all of which Lenders have agreed to do, subject, however, to the terms
and conditions herein contained. The parties hereto have agreed to
amend and restate, in its entirety, the Original Credit Agreement in order to
give effect to the foregoing.
Now,
therefore, in consideration of the foregoing premises and the mutual agreements
herein contained, the Lenders hereby consent to the Drop Down and the Share
Exchange, and the release of EBOF and ▇▇▇▇▇▇ from their obligations under the
Original Credit Agreement and the Amended and Restated Guarantee and Collateral
Agreement; and the parties hereto agree to amend and restate the Original Credit
Agreement in its entirety as follows:
|
Section
1.
|
Definitions;
Interpretation.
|
1.1. Definitions.
When used
herein the following terms shall have the following meanings:
Acceleration Event
means the occurrence of any of the following: (i) an Event of Default
under Section
8.1.3; (ii) an Event of Default under Section 8.1.1 and the
termination of the Commitments pursuant to Section 8.2; or (iii)
any other Event of Default under Section 8.1 and the
election by the Required Lenders to declare the Obligations to be due and
payable pursuant to Section
8.2.
Acquisition means any
transaction or series of related transactions for the purpose of or resulting,
directly or indirectly, in (a) the acquisition of all or a substantial portion
of the assets of a Person, or of all or a substantial portion of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is already a Subsidiary).
Adjusted Working
Capital means the remainder of (a) the consolidated current assets of
Borrower and its Subsidiaries minus the amount of cash and cash equivalents
included in such consolidated current assets, minus (b) the consolidated current
liabilities of Borrower and its Subsidiaries minus the amount of consolidated
short-term Debt (including current maturities of long-term Debt) of Borrower and
its Subsidiaries included in such consolidated current liabilities.
Affiliate of any
Person means (a) any other Person which, directly or indirectly, controls or is
controlled by or is under common control with such Person, (b) any officer or
director of such Person and (c) with respect to any Lender, any entity
administered or managed by such Lender or an Affiliate or investment advisor
thereof which is engaged in making, purchasing, holding or otherwise investing
in commercial loans. A Person shall be deemed to be “controlled by”
any other Person if such Person possesses, directly or indirectly, power to vote
10% or more of the securities (on a fully diluted basis) having ordinary voting
power for the election of directors or managers or power to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise. Unless expressly stated otherwise herein, neither Agent
nor any Lender shall be deemed an Affiliate of any Loan Party.
Agent means Fourth
Third LLC in its capacity as agent for all Lenders hereunder and any successor
thereto in such capacity.
Agreement has the
meaning set forth in the Preamble.
Applicable Margin
means 7.25% per annum.
Approved Fund means
(a) any fund, trust or similar entity that invests in commercial loans in the
ordinary course of business and is advised or managed by (i) a Lender, (ii) an
Affiliate of a Lender, (iii) the same investment advisor that manages a Lender
or (iv) an Affiliate of an investment advisor that manages a Lender or (b) any
finance company, insurance company or other financial institution which
temporarily warehouses loans for any Lender or any Person described in clause
(a) above.
Arizona LNG means
Arizona LNG, L.L.C., a Nevada limited liability company.
Assignee has the
meaning set forth in Section
10.8.1.
Assignment Agreement
means an agreement substantially in the form of Exhibit A.
Black Forest means
Black Forest International, LLC, or its registered assigns in respect of the
Black Forest Note.
Black Forest Debt
means the Indebtedness of PNG to Black Forest in the original principal amount
of $628,250, evidenced by the Black Forest Note.
Black Forest Guaranty
means the Guaranty Agreement, dated on or about the Closing Date, given by the
Loan Parties (other than Parent) in respect of the Black Forest Debt
guaranteeing the payment thereof.
Black Forest Note
means the 12% Subordinated Secured Convertible Promissory Note, dated June 3,
2008, issued by PNG to the order of Black Forest to evidence the Black Forest
Debt.
Black Forest Security
means the Lien given by the Loan Parties pursuant to the Black Forest Security
Agreement on all or certain of their assets to secure payment of the Black
Forest Debt.
Black Forest Security
Agreement means the General Security Agreement, dated on or about the
Closing Date, given by the Loan Parties in respect of the Black Forest Debt to
secure the payment thereof.
Black Forest Subordination
Agreement means the Subordination Agreement, dated the Closing Date, made
among Agent, the Loan Parties and Black Forest, evidencing the subordination of
the Black Forest Debt to the Obligations.
Board of Directors
has the meaning ascribed to it in Section
6.10.
Borrower has the
meaning set forth in the Preamble.
Business Day means
any day on which commercial banks are open for commercial banking business in
San Francisco, California and New York, New York, and on which dealings are
carried on in the London interbank eurodollar market.
Calculation Date
means each of the Closing Date and the 15th day of each calendar month
thereafter.
Capital Expenditures
means all expenditures which, in accordance with GAAP, would be required to be
capitalized and shown on the consolidated balance sheet of Borrower, but
excluding expenditures made in connection with the replacement, substitution or
restoration of assets to the extent financed (a) from insurance proceeds (or
other similar recoveries) paid on account of the loss of or damage to the assets
being replaced or restored, (b) with cash awards of compensation arising from
the taking by eminent domain or condemnation of the assets being
replaced,
or (c) with cash proceeds of Dispositions that are reinvested in accordance with
this Agreement.
Capital Lease means,
with respect to any Person, any lease of (or other agreement conveying the right
to use) any real or personal property by such Person that, in conformity with
GAAP, is accounted for as a capital lease on the balance sheet of such
Person.
Cash Equivalent
Investment means, at any time, (a) any evidence of Debt, maturing not
more than one year after such time, issued or guaranteed by the United States
Government or any agency thereof, (b) commercial paper, or corporate demand
notes, in each case (unless issued by a Lender or its holding company) rated at
least A-l by Standard & Poor’s Ratings Group or P-l by ▇▇▇▇▇’▇ Investors
Service, Inc., (c) any certificate of deposit (or time deposit represented by a
certificate of deposit) or banker’s acceptance maturing not more than one year
after such time, or any overnight Federal Funds transaction that is issued or
sold by any Lender (or by a commercial banking institution that is a member of
the Federal Reserve System and has a combined capital and surplus and undivided
profits of not less than $500,000,000), (d) any repurchase agreement entered
into with any Lender (or commercial banking institution of the nature referred
to in clause (c) above) which (i) is secured by a fully perfected security
interest in any obligation of the type described in any of clauses (a) through
(c) above and (ii) has a market value at the time such repurchase agreement is
entered into of not less than 100% of the repurchase obligation of such Lender
(or other commercial banking institution) thereunder, (e) money market accounts
or mutual funds which invest predominantly in assets satisfying the foregoing
requirements and (f) other short term liquid investments approved in writing by
Agent.
Closing Date means
the date on which the conditions set forth in Section 4.1 have been
satisfied or waived by the Lenders.
Collateral means all
property and interests in property and proceeds thereof now owned or hereafter
acquired by any Loan Party and any other Person who has granted a Lien to the
Agent, in or upon which a Lien now or hereafter exists in favor of any Lender or
the Agent for the benefit of the Agent and Lenders, whether under this Agreement
or under any other documents executed by any such Persons and delivered to the
Agent; provided, however, that with
respect to Parent, the term “Collateral” includes only (i) all capital stock of
the Borrower now owned or hereafter acquired by Parent and (ii) all proceeds and
products of any and all of the property listed in clause (i) and all collateral
security and guarantees given by any Person with respect to any of such
property, and excludes all other property or proceeds thereof now owned or
hereafter acquired by Parent.
Collateral Access
Agreement means an agreement in form and substance reasonably
satisfactory to Agent pursuant to which a mortgagee or lessor of real property
on which Collateral is stored or otherwise located, or a warehouseman, processor
or other bailee of Inventory or other property owned by any Loan Party,
acknowledges the Liens of Agent and waives (or, if approved by Agent,
subordinates) any Liens held by such Person on such property, and, in the case
of any such agreement with a mortgagee or lessor, permits Agent reasonable
access to and use of such real property during the continuance of an Event of
Default to assemble, complete and sell any Collateral stored or otherwise
located thereon.
Collateral Documents
means, collectively, the Guarantee and Collateral Agreement, each Mortgage, and
each other agreement or instrument pursuant to or in connection with which any
Loan Party or any other Person grants a security interest in any Collateral to
Agent for the benefit of Lenders, each as amended, restated or otherwise
modified from time to time.
Commitment means, as
to any Lender, such Lender’s Pro Rata Share of the Loan Commitment.
Compliance
Certificate means a certificate substantially in the form of Exhibit
B.
Computation Period
means each period of four consecutive Fiscal Quarters ending on the last day of
a Fiscal Quarter, beginning with the Fiscal Quarter ending June 30,
2008.
Consolidated Net
Income means, with respect to Borrower and its Subsidiaries for any
period, the consolidated net income (or loss) of Borrower and its Subsidiaries
for such period, excluding (i) consolidated net income of any Person for any
period prior to such Person becoming a Subsidiary, (ii) any gains or losses from
Dispositions, (iii) any extraordinary gains or extraordinary losses, (iv) any
net income of any Subsidiary to the extent that such Subsidiary is unable, by
virtue of any legal or contractual prohibition, from distributing such net
income to the Borrower, and (iv) any gains or losses from discontinued
operations.
Contingent Obligation
means any agreement, undertaking or arrangement by which any Person guarantees,
endorses or otherwise becomes or is contingently liable upon (by direct or
indirect agreement, contingent or otherwise, to provide funds for payment, to
supply funds to or otherwise to invest in a debtor, or otherwise to assure a
creditor against loss) any indebtedness, obligation or other liability of any
other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the shares of any other Person. The amount of any Person’s obligation
in respect of any Contingent Obligation shall (subject to any limitation set
forth therein) be deemed to be the principal amount of the debt, obligation or
other liability supported thereby.
Control Agreement
means a tri-party deposit account, securities account or commodities account
Control Agreements by and among the applicable Loan Party, Agent and the
depository, securities intermediary or commodities intermediary, and each in
form and substance reasonably satisfactory in all respects to Agent and in any
event providing to Agent “control” of such deposit account, securities or
commodities account within the meaning of Articles 8 and 9 of the
UCC.
Controlled Group
means all members of a controlled group of corporations and all members of a
controlled group of trades or businesses (whether or not incorporated) under
common control which, together with a Loan Party, are treated as a single
employer under Section
414 of the IRC or Section 4001 of ERISA.
Debt of any Person
means, without duplication, (a) all indebtedness of such Person for borrowed
money, (b) all indebtedness evidenced by bonds, debentures, notes or similar
instruments, (c) all obligations of such Person as lessee under Capital Leases
which have been or should be recorded as liabilities on a balance sheet of such
Person in accordance with GAAP, (d) all obligations of such Person to pay the
deferred purchase price of property or services
(excluding
trade accounts payable in the ordinary course of business), (e) all indebtedness
secured by a Lien on the property of such Person, whether or not such
indebtedness shall have been assumed by such Person (with the amount thereof
being measured as the fair market value of such property), (f) all obligations,
contingent or otherwise, with respect to letters of credit (whether or not
drawn), banker’s acceptances and surety bonds issued for the account of such
Person, (g) all Hedging Obligations of such Person, (h) all Contingent
Obligations of such Person, (i) all non-compete payment obligations and earn-out
and similar obligations, (j) all obligations of such Person in respect of
capital stock issued by such Person, to the extent that such Person is obligated
to redeem, retire or repurchase such capital stock or set apart any funds
therefor, on or prior to the date one year after the Maturity Date, (k) all
indebtedness of the types listed in (a) through (j) or (l) of any partnership of
which such Person is a general partner and (k) all obligations of such Person
under any synthetic lease transaction, where such obligations are considered
borrowed money indebtedness for tax purposes but the transaction is classified
as an operating lease in accordance with GAAP.
Default means any
event that, if it continues uncured, will, with the lapse of time or the giving
of notice or both, constitute an Event of Default.
Default Rate has the
meaning set forth in Section
2.4.1.
Disposition means, as
to any asset or right of any Loan Party, (a) any sale, lease, assignment or
other transfer (other than to Borrower or any of its Wholly-Owned Domestic
Subsidiaries), (b) any loss, destruction or damage thereof or (c) any
condemnation, confiscation, requisition, seizure or taking thereof, excluding
(i) Dispositions in any Fiscal Year, the Net Cash Proceeds of which do not in
the aggregate exceed $250,000, or in the case of any Disposition described in
clause (b) above, $150,000, (ii) the sale or other transfer of Inventory in the
ordinary course of business and (iii) any transfers of cash.
Dollar and $ mean lawful money
of the United States of America.
Domestic Loan Party
Subsidiary means Borrower and each Domestic Subsidiary of
Borrower.
Domestic Subsidiary
means any Subsidiary that is incorporated or organized under the laws of a State
within the United States of America or the District of Columbia.
▇▇▇▇▇▇ means ▇▇▇▇▇▇
Biofuels, LLC, an Oklahoma limited liability company and wholly-owned Subsidiary
of EBOF, but, for avoidance of doubt, not a Loan Party hereunder.
EBITDA means, for any
period, Consolidated Net Income for such period plus, to the extent deducted in
determining such Consolidated Net Income for such period, (i) Interest Expense,
(ii) income tax expense, (iii) depreciation and amortization,
(iv) transaction expenses incurred in connection with the financing
contemplated by this Agreement, and (v) Restricted Payments paid pursuant to
Section
7.4.
EBOF has the meaning
set forth in the Preamble.
Environmental Claims
means all claims, however asserted, by any governmental, regulatory or judicial
authority or other Person alleging potential liability or responsibility under
or for violation of any Environmental Law, or for release or injury to the
environment or any Person or property or natural resources.
Environmental Laws
means all present or future federal, state or local laws, statutes, common law
duties, rules, regulations, ordinances and codes, including all amendments,
together with all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case relating to any matter arising out of or relating to health and
safety, or pollution or protection of the environment, natural resources or
workplace, including any of the foregoing relating to the presence, use,
production, recycling, reclamation, generation, handling, transport, treatment,
storage, disposal, distribution, discharge, release, emission, control, cleanup
or investigation or management of any Hazardous Substance.
ERISA means the
Employee Retirement Income Security Act of 1974, as amended.
Event of Default
means any of the events described in Section
8.1.
Excess Cash Flow
means, for any Fiscal Quarter, the remainder of (a) the sum of
(i) EBITDA for such Fiscal Quarter, plus (ii) any
net decrease in Adjusted Working Capital during such Fiscal Quarter, minus (b) the
sum, without duplication, of (i) scheduled repayments of principal of the
Loan and other Debt of Borrower and its Subsidiaries permitted by Section 7.1 made
during such Fiscal Quarter, plus (ii) any
voluntary prepayments of the Loan pursuant to Section 2.5.1 during
such Fiscal Quarter, plus (iii) all
federal, state, local and foreign income taxes paid in cash by Borrower and its
Subsidiaries during such Fiscal Quarter, plus (iv) all
Interest Expense in respect of Debt permitted in accordance with Section 7.1 paid in
cash by Borrower and its Subsidiaries during such Fiscal Quarter, plus (v) any
net increase in Adjusted Working Capital during such Fiscal Quarter, all as
determined by Agent for such period.
Excluded Taxes has
the meaning set forth in Section
3.1(a).
Executive Order 13224
has the meaning set forth in Section
5.21.1.
Exercisable Shares
has the meaning set forth in Section
6.11.
Existing Loan means
the “Loan” (as defined in the Original Credit Agreement) equal in amount to
$26,700,000 on the Closing Date.
Fee Letter means,
that certain letter agreement dated as of even date herewith between Agent and
Borrower, as amended, restated or otherwise modified from time to time, which
supersedes and replaces the Original Fee Letter.
First Interest Reserve
Period has the meaning set forth in Section
2.4.2.
Fiscal Quarter means
a fiscal quarter of a Fiscal Year.
Fiscal Year means the
fiscal year of Borrower and its Subsidiaries, which period shall be the 12-month
period ending on December 31 of each year.
Fixed Charge Coverage
Ratio means, for any Computation Period, the ratio of (a) the total for
such Computation Period of EBITDA minus all Capital
Expenditures to (b) the sum for such Computation Period of (i) Interest Expense
of Borrower and its
Subsidiaries accrued during such period and payable in cash, plus (ii) required
payments of principal of Debt (including the Loan), (iii) income tax expense,
plus (iv) dividends paid by Earth Leasing, Inc. during such period except as
then permitted to be paid pursuant to Section
7.4(iii).
Foreign Lender means
any Lender that is not a United States person under and as defined in Section
7701(a)(30) of the IRC.
Foreign Subsidiary
means any Subsidiary that is not a Domestic Subsidiary.
Fourth Third has the
meaning set forth in the preamble hereto.
FRB means the Board
of Governors of the Federal Reserve System or any successor
thereto.
GAAP means generally
accepted accounting principles in effect in the United States of America set
forth from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the circumstances as of the
date of determination.
Gas Supply and Hedge
Contracts, means, collectively, the Gas Price Hedge Agreement, dated June
2006, between Apollo Resources International, Inc. and Arizona LNG and the Gas
Sale Purchase and Service Agreement, dated November 1, 2005, between BP Energy
Company and Arizona LNG, as each may be amended, restated or otherwise modified
from time to time.
Governmental
Authority means any nation or government, any state or other political
subdivision thereof, any central bank (or similar monetary or regulatory
authority) thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
Guarantee and Collateral
Agreement means the Guarantee and Collateral Agreement, dated as of the
Closing Date, made by each Loan Party and other grantor or pledgor signatory
thereto in favor of Agent, as amended, restated or otherwise modified from time
to time.
Hazardous Substances
means any waste, chemical, substance, or material listed, defined, classified,
or regulated as a hazardous waste, hazardous substance, pollutant, contaminant,
toxic substance, or hazardous, dangerous or radioactive material, chemical or
waste or otherwise regulated by any Environmental Law, including, without
limitation, any petroleum or any derivative, waste, or byproduct thereof, radon,
asbestos, and polychlorinated biphenyls.
Hedging Obligation
means, with respect to any Person, any liability of such Person under any
interest rate, currency or commodity swap agreement, cap agreement or collar
agreement, and any other agreement or arrangement designed to protect a Person
against fluctuations in interest rates, currency exchange rates or commodity
prices. The amount of any Person’s obligation in respect of any
Hedging Obligation shall be deemed to be the incremental obligation that would
be reflected in the financial statements of such Person in accordance with
GAAP.
Indemnified
Liabilities has the meaning set forth in Section
10.5.
Initial Loan has the
meaning provided in Section
2.1(a).
Intercreditor
Agreement means the intercreditor agreement, dated as of the Original
Closing Date, between Agent and the holder of Senior Debt (or a representative
thereof), in form and substance satisfactory to Agent, as amended or modified
from time to time.
Interest Expense
means for any period the consolidated interest expense of Borrower and its
Subsidiaries for such period (including all imputed interest on Capital
Leases).
Inventory means all
the “inventory” (as such term is defined in the UCC) of the Borrower and its
Subsidiaries, including, but not limited to, all merchandise, raw materials,
parts, supplies, work-in-process and finished goods intended for sale, together
with all the containers, packing, packaging, shipping and similar materials
related thereto, and including such inventory as is temporarily out of the
Borrower’s or such Subsidiary’s custody or possession, including inventory on
the premises of others and items in transit.
Investment means,
with respect to any Person, (a) the purchase of any debt or equity security of
any other Person, (b) the making of any loan or advance to any other Person, (c)
becoming obligated with respect to a Contingent Obligation in respect of
obligations of any other Person (other than travel and similar advances to
employees in the ordinary course of business) or (d) the making of an
Acquisition.
IRC means the
Internal Revenue Code of 1986, as amended.
Key Employees means
(i) ▇▇▇▇ ▇▇▇▇▇▇, as Chief Executive Officer of Borrower, and (ii) ▇▇▇▇ ▇▇▇▇▇▇▇,
as Chief Financial Office of Borrower.
Key Employment
Agreements means employment agreements, to be in form and substance
satisfactory to Agent, executed on or before the Closing Date between the Key
Employees and Borrower respecting the employment of the Key Employees by
Borrower.
Last Pre Closing Audit
Date means December 31, 2007.
Legal Costs means,
with respect to any Person, (a) all reasonable fees and charges of any counsel,
accountants, auditors, appraisers, consultants and other professionals to such
Person, (b) the reasonable allocable cost of internal legal services of such
Person and all reasonable disbursements of such internal counsel and (c) all
court costs and similar legal expenses.
Lender Party has the
meaning set forth in Section
10.5.
Lenders has the
meaning set forth in the Preamble.
LIBOR Rate means, as
of any Calculation Date, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) equal to (i) the offered rate for deposits in Dollars
for the period of one month commencing on such Calculation Date and for the
amount of the Loan, that appears on Dow ▇▇▇▇▇ Market Service (formerly known as
the Telerate Service) at 11:00 a.m. London time (or, if not so appearing, as
published in the “Money Rates” section of The Wall Street
Journal or another national publication selected by Agent) on such
Calculation Date, divided by (ii) the sum of one minus the daily average during
such period of one month of the aggregate maximum reserve requirement (expressed
as a decimal) then imposed under Regulation D of the FRB for “Eurocurrency
Liabilities” (as defined therein); provided, however, that in no
event shall the LIBOR Rate be a rate equal to less than 2.50% per
annum.
Lien means, with
respect to any Person, any interest granted by such Person in any real or
personal property, asset or other right owned or being purchased or acquired by
such Person which secures payment or performance of any obligation and shall
include any mortgage, lien, encumbrance, charge or other security interest of
any kind, whether arising by contract, as a matter of law, by judicial process
or otherwise.
Loan has the meaning
provided in Section
2.1(b).
Loan Commitment means
a commitment to make a loan pursuant to Section 2.1 on the
Closing Date in the aggregate principal amount for all Lenders of
$34,000,000. The Loan Commitment shall terminate upon the making of
the Loan.
Loan Documents means
this Agreement, the Notes, the Collateral Documents, the Fee Letter, the
Intercreditor Agreement, the Black Forest Subordination Agreement, the Original
Loan Documents (to the extent not superseded or replaced pursuant hereto) and
all other documents, instruments and agreements delivered in connection with the
foregoing, all as amended, restated or otherwise modified from time to
time.
Loan Party means
Parent, Borrower and each Subsidiary of Borrower.
Loan Party Subsidiary
means Borrower and each Subsidiary of Borrower.
Margin Stock means
any “margin stock” as defined in Regulation T, U or X of the FRB.
Material Adverse
Effect means (a) a material adverse change in, or a material adverse
effect upon, the operations, assets, business, prospects, properties or
condition (financial or otherwise) of Loan Parties taken as a whole, (b) a
material impairment of the ability of any Loan Party to perform in any material
respect any of its Obligations under any Loan Document or (c) a material adverse
effect upon any substantial portion of the Collateral under the Collateral
Documents or upon the legality, validity, binding effect or enforceability
against any Loan Party of any Loan Document.
Maturity Date means
June __, 2010.
Mortgage means a
mortgage, deed of trust, leasehold mortgage or similar instrument granting Agent
a Lien on a real property interest of any Loan Party, each as amended, restated
or otherwise modified from time to time.
Multiemployer Pension
Plan means a multiemployer plan, as defined in Section 4001(a)(3) of
ERISA, to which Borrower or any member of the Controlled Group may have any
liability.
Net Cash Proceeds
means:
(a) with
respect to any Disposition, the aggregate cash proceeds (including cash proceeds
received pursuant to policies of insurance and by way of deferred payment of
principal pursuant to a note, installment receivable or otherwise, but only as
and when received) received by any Loan Party pursuant to such Disposition net
of (i) the reasonable direct costs relating to such Disposition (including sales
commissions and legal, accounting and investment banking fees, commissions and
expenses), (ii) any portion of such proceeds deposited in an escrow account
pursuant to the documentation relating to such Disposition (provided that such
amounts shall be treated as Net Cash Proceeds upon their release from such
escrow account to the applicable Loan Party), (iii) taxes paid or reasonably
estimated by Borrower to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), (iv) amounts required to be applied to the repayment of any Debt
secured by a Lien (permitted hereunder) prior to the Lien of Agent on the asset
subject to such Disposition, and (v) so long as no Event of Default exists (or
if an Event of Default exists, only with the prior written consent of Required
Lenders) (A) with respect to any Disposition described in clause (a) of the
definition thereof, all money actually applied within 180 days, or within 360
days pursuant to a binding agreement executed within 180 days, to replace such
assets with assets performing the same or similar functions, and (B) with
respect to any Disposition described in clause (b) or (c) of the definition
thereof, all money actually applied within 180 days, or within 360 days pursuant
to a binding agreement executed within 180 days, to repair, replace or
reconstruct damaged property or property affected by loss, destruction, damage,
condemnation, confiscation, requisition, seizure or taking; and
(b) with
respect to any issuance of equity securities, the aggregate cash proceeds
received by Parent, Borrower or any Subsidiary of Borrower or of ▇▇▇▇▇▇ Fuels,
LLC pursuant to such issuance, net of the reasonable direct costs relating to
such issuance (including reasonable sales and underwriter’s
commission).
Non-Excluded Taxes
has the meaning set forth in Section
3.1(a).
Note means a
promissory note substantially in the form of Exhibit C, as the
same may be replaced, substituted, amended, restated or otherwise modified from
time to time.
Obligations means all
liabilities, indebtedness and obligations (monetary (including interest accrued
at the rate provided in the applicable Loan Document after the commencement of a
bankruptcy proceeding whether or not a claim for such interest is allowed) or
otherwise) of
any Loan
Party under this Agreement, any other Loan Document, any Collateral Document or
any other document or instrument executed in connection herewith or therewith
and all Hedging Obligations permitted hereunder which are owed to any Lender or
its Affiliate, in each case howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, now or hereafter existing, or due or
to become due.
OFAC has the meaning
set forth in Section
6.4(a).
Original Closing Date
means February 28, 2007.
Original Credit
Agreement has the meaning set forth in the Preamble.
Original Fee Letter
means the Fee Letter, dated the Original Closing Date, between Borrower and
Agent, as amended pursuant to a letter agreement, dated June 21, 2007, between
Borrower and Agent.
Original Loan
Documents shall mean all “Loan Documents” (as that term is defined in the
Original Loan Agreement) existing on the Closing Date.
Paid in Full means,
with respect to any Obligations, the payment in full in cash and performance of
all such Obligations.
Parent has the
meaning set forth in the Preamble.
Participant has the
meaning set forth in Section
10.8.2.
PBGC means the
Pension Benefit Guaranty Corporation and any entity succeeding to any or all of
its functions under ERISA.
Pension Plan means a
“pension plan”, as such term is defined in Section 3(2) of ERISA, which is
subject to Title IV of ERISA (other than a Multiemployer Pension Plan), and to
which Borrower or any member of the Controlled Group may have any liability,
including any liability by reason of having been a substantial employer within
the meaning of Section 4063 of ERISA at any time during the preceding five
years, or by reason of being deemed to be a contributing sponsor under Section
4069 of ERISA.
Person means any
natural person, corporation, partnership, trust, limited liability company,
association, Governmental Authority or unit, or any other entity, whether acting
in an individual, fiduciary or other capacity.
Pro Rata Share means,
with respect to any Lender, the applicable percentage (as adjusted from time to
time in accordance with the terms hereof) specified opposite such Lender’s name
on Annex I (or
in such Lender’s Assignment Agreement) which corresponds to the Loan Commitment,
which percentage shall be with respect to the Loan if the Loan Commitment has
terminated.
Replacement Lender
has the meaning set forth in Section
3.5(b).
Required Lenders
means Lenders having Pro Rata Shares the aggregate Dollar equivalent amount of
which equals or exceeds more than 50% of the outstanding Loan,
collectively.
Securitization has
the meaning set forth in Section
10.9.
Senior Debt shall
mean indebtedness that is incurred by the Borrower under a revolving credit
facility that has been approved by Agent and that is subject to, and the Liens,
if any, securing which are subject to, the Intercreditor Agreement.
Senior Debt Documents
means the “Revolving Credit Documents” as defined in the Interecreditor
Agreement.
Share Exchange has
the meaning set forth in the Preamble.
Share Exchange
Agreement has the meaning set forth in the Preamble.
Share Rights
Agreement means that certain Master Rights Agreement, dated as of the
Closing Date, made between Parent and Medley, as it may be supplemented,
modified or amended from time to time.
Subsidiary means,
with respect to any Person, a corporation, partnership, limited liability
company or other entity of which such Person owns, directly or indirectly, such
number of outstanding shares or other equity interests as to have more than 50%
of the ordinary voting power for the election of directors or other managers of
such corporation, partnership, limited liability company or other
entity. Unless the context otherwise requires, each reference to
Subsidiaries herein shall be a reference to Subsidiaries of
Borrower.
Tax Returns has the
meaning set forth in Section
5.12.
Titled Vehicle means
a vehicle owned by a Loan Party for which a certificate of title has been issued
by any jurisdiction pursuant to a statute described in section 9-311(a)(2) or
9-311(a)(3) of the UCC, a security interest in which against such Loan Party can
be perfected only by notation on the certificate of title.
UCC means the Uniform
Commercial Code as in effect in from time to time in the State of New
York.
Wholly-Owned Domestic
Subsidiary means any Wholly-Owned Subsidiary that is a Domestic
Subsidiary.
Wholly-Owned
Subsidiary means, as to any Subsidiary, all of the equity interests of
which (except directors’ qualifying shares) are at the time directly or
indirectly owned by Borrower and/or another Wholly-Owned Subsidiary of
Borrower.
1.2. Interpretation.
In the
case of this Agreement and each other Loan Document, (a) the meanings of defined
terms are equally applicable to the singular and plural forms of the defined
terms; (b)
Annex,
Exhibit, Schedule and Section references are to such Loan Document unless
otherwise specified; (c) the term “including” is not limiting and means
“including but not limited to”; (d) in the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including”; the words “to” and “until” each mean “to but excluding”, and the
word “through” means “to and including”; (e) unless otherwise expressly provided
in such Loan Document, (i) references to agreements and other contractual
instruments shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and (ii)
references to any statute or regulation shall be construed as including all
statutory and regulatory provisions amending, replacing, supplementing or
interpreting such statute or regulation; (f) this Agreement and the other Loan
Documents may use several different limitations, tests or measurements to
regulate the same or similar matters, all of which are cumulative and each shall
be performed in accordance with its terms; and (g) this Agreement and the other
Loan Documents are the result of negotiations among and have been reviewed by
counsel to Agent, Borrower, Lenders and the other parties hereto and thereto and
are the products of all parties; accordingly, they shall not be construed
against Agent or Lenders merely because of Agent’s or Lenders’ involvement in
their preparation.
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Section
2.
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Credit
Facilities.
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2.1. Commitments.
On the terms and subject to the
conditions of this Agreement, each Lender, severally and for itself alone,
agrees to lend to Borrower on the Closing Date such Lender’s applicable Pro Rata
Share of the Loan Commitment (the “Loan”). Any
portion of the Loan which is repaid or prepaid, in whole or in part, may not be
reborrowed. A portion of the proceeds of the Loan, equal in amount to
the then unpaid principal balance of the Existing Loan, together with all
accrued interest thereon, shall be retained by Agent and used by Agent to
refinance the Existing Loan by its extension and renewal pursuant hereto; a
portion of such proceeds shall be returned by Agent for its own account to pay
certain fees owing to it in the Closing Date pursuant to the Fee Letter; and the
remainder of the proceeds of the Loan shall be disbursed to a deposit account of
Borrower with JPMorgan Chase Bank, N.A. specified by Borrower in writing to
Agent, thereafter to be used by Borrower to pay closing costs associated
herewith, to pay certain accounts payable, to finance the making of certain
Capital Expenditures, and for working capital.
2.2. Omitted.
2.3. Loan
Accounting.
2.3.1. Recordkeeping.
Agent, on
behalf of each Lender, shall record in its records the date and amount of the
share of the Loan made by each Lender and each repayment thereof. The
aggregate unpaid principal amount so recorded shall be rebuttably presumptive
evidence of the principal amount of the Loan owing and unpaid. The
failure to so record any such amount or any error in so recording any such
amount shall not, however, limit or otherwise affect the Obligations
of
Borrower
hereunder or under any Note to repay the principal amount of the Loan hereunder,
together with all interest accruing thereon.
2.3.2. Notes.
At the
request of any Lender, the share of the Loan made by such Lender shall be
evidenced by a Note, with appropriate insertions, payable to the order of such
Lender in a face principal amount equal to the sum of such Lender’s Pro Rata
Share of the Loan Commitment and payable in such amounts and on such dates as
are set forth herein.
2.4. Interest.
2.4.1. Interest
Rates.
Borrower
promises to pay interest on the unpaid principal amount of the Loan for the
period commencing on the Closing Date until the Loan is Paid in Full at a rate
per annum equal to the sum of the LIBOR Rate as in effect on the Calculation
Date coinciding with (in the case of the Closing Date) or immediately preceding
(in the case of any other Calculation Date), the interest payment date on which
such interest is payable plus the Applicable Margin; provided, that (i) at any
time an Event of Default exists, if requested by the Agent or the Required
Lenders, the Applicable Margin corresponding to the Loan shall be increased by
two percentage points per annum (and, in the case of Obligations other than the
Loan, such Obligations shall bear interest at the LIBOR Rate plus the Applicable
Margin plus two percentage points per annum) (any such increased rate, the
“Default
Rate”), (ii) any such increase may thereafter be rescinded by Required
Lenders, notwithstanding Section 10.1, and
(iii) upon the occurrence of an Event of Default under Section 8.1.1 or
8.1.3, any such
increase described in the foregoing clause (i) shall occur
automatically. In no event shall interest payable by Borrower to
Agent and Lenders hereunder exceed the maximum rate permitted under applicable
law, and if any such provision of this Agreement is in contravention of any such
law, such provision shall be deemed modified to limit such interest to the
maximum rate permitted under such law.
2.4.2. Interest Payment
Dates.
Accrued
interest on the Loan shall be payable in advance on the Closing Date (for the
period beginning on the Closing Date and ending on June 30, 2008 and thereafter
on the first day of each calendar month (for such calendar month), and, to the
extent not paid in advance, upon a prepayment of the Loan in accordance with
Section 2.6 and
at maturity, in each case, in cash and, during the Interest Reserve Periods, as
provided in Section
2.4.2(b). After maturity and at any time an Event of Default
exists, all accrued interest on the Loan shall be payable in cash on demand at
the rates specified in Section
2.4.1.
2.4.3. Setting and Notice of LIBOR
Rates.
The
applicable LIBOR Rate as of each Calculation Date shall be determined by Agent,
and notice thereof shall be given by Agent promptly to Borrower and each
Lender. Each determination of the applicable LIBOR Rate by Agent
shall be conclusive and binding upon the parties hereto, in the absence of
demonstrable error. Agent shall, upon written request of
Borrower
or any Lender, deliver to Borrower or such Lender a statement showing the
computations used by Agent in determining any applicable LIBOR Rate
hereunder
2.4.4. Computation of
Interest.
Interest
shall be computed for the actual number of days elapsed on the basis of a year
of 360 days.
2.5. Fees.
2.5.1. Fourth Third’s
Fees.
Borrower
agrees to pay to Fourth Third, for Fourth Third’s account, the fees set forth in
the Fee Letter.
2.6. Prepayment.
2.6.1. Voluntary
Prepayment.
Borrower
may from time to time at any time, on at least ninety (90) days’ written notice
to Agent (which shall promptly advise each Lender thereof) not later than 12:00
noon New York time on such day, prepay the Loan in whole or in part without
penalty or premium so long as any such prepayment is on the first day of a
calendar month, and is accompanied by all accrued and unpaid interest on the
Loan. Such notice to Agent shall specify the date and amount of
prepayment. Any such partial prepayment shall be in an amount greater
than or equal to $1,000,000 or a higher integral multiple of
$500,000.
2.6.2. Mandatory
Prepayment.
Borrower
shall prepay the Loan until Paid in Full at the following times and in the
following amounts:
(i) concurrently
with the receipt by any Loan Party of any Net Cash Proceeds from any
Disposition, in an amount equal to such Net Cash Proceeds; and
(ii) concurrently
with the receipt by any Loan Party of any Net Cash Proceeds from any issuance of
its equity securities (other than equity securities that are issued to (x)
Parent, (y) management of Parent, or (z) to Persons that as of the date hereof
hold equity in Parent; but, without limitation of the foregoing, and for
avoidance of any doubt, inclusive of any equity securities issued pursuant to
the contemplated PIPE or any similar offering whether to Persons that as of the
date hereof hold equity in Parent or otherwise) in an amount equal to such Net
Cash Proceeds; and
(iii) within
forty-five (45) days after the end of each Fiscal Quarter (commencing with the
Fiscal Quarter ending September 30, 2008), in an amount equal to fifty percent
(50%) of the Excess Cash Flow earned during such prior Fiscal Quarter, until the
Loan is reduced in principal amount to $30,000,000, and, thereafter, in an
amount equal to twenty-five percent (25%) of the Excess Cash Flow earned during
such prior Fiscal Quarter.
Notwithstanding clause (ii) above, in
the event that Parent issues equity securities pursuant to the contemplated PIPE
or enters into any similar transaction involving the sale or exchange of equity
securities, debt or convertible debt of Parent subsequent to the Closing Date,
after Borrowers have caused the Loan to be reduced in principal amount to not
less than $30,000,000 from the Net Cash Proceeds therefrom, Borrowers shall, to
the extent provided in and permitted by the Black Forest Subordination
Agreement, pay the then outstanding principal amount of the Black Forest Note
from any remaining Net Cash Proceeds, until it is paid in full, after which any
remaining Net Cash Proceeds may be used by Borrower to prepay further the Loan,
to repay Senior Debt or for any other corporate purpose not in contravention of
any terms of this Agreement.
2.6.3. All
Prepayments.
Any
prepayment of the Loan on any day other than the first day of a calendar
month shall include interest on the principal amount being repaid to
the extent not paid in advance and shall be subject to Section
3.3.
2.7. Repayment.
The
outstanding principal balance of the Loan shall be Paid in Full, for the account
of each Lender according to its Pro Rata Share thereof, on the Maturity Date
unless accelerated sooner pursuant to Section
8.2.
2.8. Payment.
2.8.1. Making of
Payments.
All
payments of principal of or interest on the Notes, and of all fees, shall be
made by Borrower to Agent without setoff, recoupment or counterclaim and in
immediately available funds at the deposit account of Agent in New York, New
York set forth on Annex II or at such other deposit account in New York
specified by Agent, in any case, not later than 1:00 p.m. New York time on the
date due, and funds received after that hour shall be deemed to have been
received by Agent on the following Business Day. Agent shall promptly
remit to each Lender its share of all principal, interest and fee payments
received in collected funds by Agent for the account of such
Lender. All payments under Section 3.2 shall be
made by Borrower directly to Lender entitled thereto.
2.8.2. Application of Payments and
Proceeds.
(a) Except
as set forth in Section 2.6.2, and
subject to the provisions of Sections 2.8.2(b)
below, each payment by Borrower hereunder shall be applied to such Obligations
as Borrower shall direct by notice to be received by Agent on or before the date
of such payment or, in the absence of such notice, as Agent shall determine in
its discretion. Concurrently with each remittance to any Lender of
its share of any such payment, Agent shall advise such Lender as to the
application of such payment.
(b) If
an Event of Default or an Acceleration Event shall have occurred and be
continuing, notwithstanding anything herein or in any other Loan Document to the
contrary, Agent shall apply all or any part of payments in respect of the
Obligations and proceeds of Collateral, in each case as received by Agent, to
the payment of the Obligations in the following order:
(i) FIRST,
to the payment of all fees, costs, expenses and indemnities due and owing to
Agent under this Agreement or any other Loan Document, and any other Obligations
owing to Agent in respect of sums advanced by Agent to preserve or protect the
Collateral or to preserve or protect its security interest in the Collateral
(whether or not such Obligations are then due and owing to Agent), until Paid in
Full;
(ii) SECOND,
to the payment of all fees, costs, expenses and indemnities due and owing to
Lenders, pro rata based on each Lender’s Pro Rata Share thereof, until Paid in
Full;
(iii) THIRD,
to the payment of all accrued and unpaid interest due and owing to Lenders, pro
rata based on each Lender’s Pro Rata Share thereof, until Paid in
Full;
(iv) FOURTH,
to the payment of all principal of the Loan due and owing, pro rata based on
each Lender’s Pro Rata Share thereof, until Paid in Full; and
(v) FIFTH,
to the payment of all other Obligations owing to each Lender, pro rata based on
each Lender’s Pro Rata Share thereof, until Paid in Full.
2.8.3. Payment
Dates.
If any
payment of principal of or interest on the Loan, or of any fees, falls due on a
day which is not a Business Day, then such due date shall be extended to the
immediately following Business Day (unless such immediately following Business
Day is the first Business Day of a calendar month, in which case such due date
shall be the immediately preceding Business Day) and, in the case of principal,
additional interest shall accrue and be payable for the period of any such
extension.
2.8.4. Set-off.
Borrower
agrees that Agent and each Lender and its Affiliates have all rights of set-off
and bankers’ lien provided by applicable law, and in addition thereto, Borrower
agrees that at any time an Event of Default has occurred and is continuing,
Agent and each Lender may apply to the payment of any Obligations of Borrower
hereunder, whether or not then due, any and all balances, credits, deposits,
accounts or moneys of Borrower then or thereafter with Agent or such
Lender. Notwithstanding the foregoing, no Lender shall exercise any
rights described in the preceding sentence without the prior written consent of
Agent.
2.8.5. Proration of
Payments.
If any
Lender shall obtain any payment or other recovery (whether voluntary,
involuntary, by application of set-off or otherwise, on account of principal of
or interest on the Loan, but excluding (i) any payment of principal or interest
made in accordance with the terms
of this
Agreement, and (ii) any payment pursuant to Section 3.1, 3.2, 3.5 or 10.8, then such
Lender shall purchase from the other Lenders such participations in the Loan
held by them as shall be necessary to cause such purchasing Lender to share the
excess payment or other recovery ratably with each of them; provided that if all
or any portion of the excess payment or other recovery is thereafter recovered
from such purchasing Lender, the purchase shall be rescinded and the purchase
price restored to the extent of such recovery.
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Section
3.
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Yield
Protection.
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3.1. Taxes.
(a) Except
as otherwise provided in this Section 3.1, all
payments of principal and interest on the Loan and all other amounts payable
under any Loan Document shall be made free and clear of and without deduction
for any present or future income, excise, stamp, documentary, property or
franchise taxes and other taxes, fees, duties, levies, withholdings or other
charges of any nature whatsoever imposed by any taxing authority (“Taxes”), excluding
(i) taxes imposed on or measured by any Lender’s net income by the jurisdiction
under which such Lender is organized or conducts business, (ii) any branch
profit taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which a Lender is located and (iii) in the case of
any Foreign Lender (other than a Replacement Lender under Section 3.7(b)), any
withholding tax that (x) is in effect and would apply to amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement, except to the extent of any additional amounts to which such Foreign
Lender’s assignor, if any, was entitled, at the time of such assignment, to
receive from the Borrower with respect to any withholding tax pursuant to this
Section 3.1, or
(y) would not have been imposed but for Foreign Lender’s failure (other than as
a result of a change in law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority) to comply with Section 3.1(c)
(collectively, “Excluded Taxes” and
all such non-Excluded Taxes, “Non-Excluded
Taxes”). If any withholding or deduction from any payment to
be made by Borrower hereunder is required in respect of any Taxes pursuant to
any applicable law, rule or regulation, then Borrower shall: (i) pay
directly to the relevant authority the full amount required to be so withheld or
deducted; (ii) within thirty (30) days after the date of any such payment of
Taxes, forward to Agent an official receipt or other documentation satisfactory
to Agent evidencing such payment to such authority; and (iii) in the case of
Non-Excluded Taxes, pay to Agent for the account of Lenders such additional
amount or amounts as is necessary to ensure that the net amount actually
received by each Lender will equal the full amount such Lender would have
received had no such withholding or deduction (including deductions applicable
to any increase to any amount under this Section 3.1) been
required.
(b) The
Borrower shall reimburse and indemnify, within 30 days after receipt of demand
therefor (with copy to the Agent), Agent and each Lender for all Non-Excluded
Taxes (including any net additional Taxes imposed by any jurisdiction on amounts
payable under this Section 3.1) paid by
such Agent or such Lender and any liabilities arising therefrom or with respect
thereto (including any penalty, interest or expense), whether or not such Taxes
were correctly or legally asserted. A certificate of the Agent or
such Lender (or of the Agent on behalf of such Lender) claiming any compensation
under this clause (c), setting forth the amounts to be
paid
thereunder and delivered to the Borrower with copy to the Agent, shall be
conclusive, binding and final for all purposes, absent manifest
error.
(c) Each
Foreign Lender that (i) is a party hereto on the Closing Date or (ii) becomes an
assignee of an interest under this Agreement under Section 10.8.1 after
the Closing Date (unless such Lender was already a Lender hereunder immediately
prior to such assignment) shall execute and deliver to Borrower and Agent one or
more (as Borrower or Agent may reasonably request) properly and duly completed
and executed Forms W 8ECI, W 8BEN, W 8IMY (as applicable) or successor form or
other applicable form, certificate or document prescribed by the United States
Internal Revenue Service certifying as to such Lender’s entitlement to an
exemption from or reduction in U.S. withholding taxes with respect to payments
to be made to such Foreign Lender under the Loan
Documents. Notwithstanding any other provision of this Section 3.1 to the
contrary, no Lender shall be required to deliver any form, certificate or
document pursuant to this paragraph that it is not legally able to
deliver.
(d) Each
Lender that is not a Foreign Lender (other than any such Lender that is may be
treated as an “exempt recipient” under IRC Section 1.6049-4(c)(1)) that (i) is a
party hereto on the Closing Date or (ii) becomes an assignee of an interest
under this Agreement under Section 10.8.1 after
the Closing Date (unless such Lender was already a Lender hereunder immediately
prior to such assignment) shall execute and deliver to Borrower and Agent one or
more (as Borrower or Agent may reasonably request) properly and duly completed
and executed Form W 9 (or any successor form), certifying as to such Lender’s
entitlement to an exemption from U.S. backup withholding tax with respect to
payments to be made to such Foreign Lender under the Loan
Documents. Notwithstanding any other provision of this Section 3.1 to the
contrary, no Lender shall be required to deliver any form, certificate or
document pursuant to this paragraph that it is not legally able to
deliver.
3.2. Increased
Cost.
(a) If,
after the Closing Date, the adoption of, or any change in, any applicable law,
rule or regulation, or any change in the interpretation or administration of any
applicable law, rule or regulation by any Governmental Authority, central bank
or comparable agency charged with the interpretation or administration thereof,
or compliance by any Lender with any request or directive (whether or not having
the force of law) of any such authority, central bank or comparable
agency: (i) shall impose, modify or deem applicable any reserve
(including any reserve imposed by the FRB, but excluding any reserve included in
the determination of the LIBOR Rate pursuant to Section 2.4), special
deposit or similar requirement against assets of, deposits with or for the
account of, or credit extended by any Lender; or (ii) shall impose on any Lender
any other condition affecting its Loan, its Note or its obligation to make the
Loan; and the result of anything described in clauses (i) above and (ii) is to
increase the cost to (or to impose a cost on) such Lender of making or
maintaining the Loan, or to reduce the amount of any sum received or receivable
by such Lender under this Agreement or under its Note with respect thereto, then
upon demand by such Lender (which demand shall be accompanied by a statement
setting forth the basis for such demand and a calculation of the amount thereof
in reasonable detail, a copy of which shall be furnished to Agent), Borrower
shall pay directly to such Lender such additional amount as will compensate such
Lender for such increased cost or such reduction, so long as such amounts have
accrued on or after the day which is 180 days prior to the date on which such
Lender first made demand therefor; provided, that if the event giving rise to
such costs or reductions has retroactive effect, such 180 day period shall be
extended to include the period of retroactive effect.
(b) If
any Lender shall reasonably determine that any change in, or the adoption or
phase-in of, any applicable law, rule or regulation regarding capital adequacy,
or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or the compliance by any Lender or any
Person controlling such Lender with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender’s or such controlling Person’s capital as a consequence of
such Lender’s Commitments hereunder to a level below that which such Lender or
such controlling Person could have achieved but for such change, adoption,
phase-in or compliance (taking into consideration such Lender’s or such
controlling Person’s policies with respect to capital adequacy) by an amount
deemed by such Lender or such controlling Person to be material, then from time
to time, upon demand by such Lender (which demand shall be accompanied by a
statement setting forth the basis for such demand and a calculation of the
amount thereof in reasonable detail, a copy of which shall be furnished to
Agent), Borrower shall pay to such Lender such additional amount as will
compensate such Lender or such controlling Person for such reduction, so long as
such amounts have accrued on or after the day which is 180 days prior to the
date on which such Lender first made demand therefor; provided, that if the
event giving rise to such costs or reductions has retroactive effect, such 180
day period shall be extended to include the period of retroactive
effect.
3.3. Funding
Losses.
Borrower
hereby agrees that upon demand by any Lender (which demand shall be accompanied
by a statement setting forth the basis for the amount being claimed, a copy of
which shall be furnished to Agent), Borrower will indemnify such Lender against
any net loss or expense which such Lender may sustain or incur (including any
net loss or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund or maintain the Loan),
as reasonably determined by such Lender, as a result of (a) any payment or
prepayment of the Loan of such Lender on a date other than first day of a
calendar month or (b) the failure of Borrower to borrow the Loan on the Closing
Date. For the purposes of this Section 3.3, all
determinations shall be made as if such Lender had actually funded and
maintained the Loan during each one month period for the Loan through the
purchase of deposits having a maturity corresponding to such one month period
and bearing an interest rate equal to the LIBOR Rate for such one month
period.
3.4. Manner of Funding; Alternate
Funding Offices.
Notwithstanding
any provision of this Agreement to the contrary, each Lender shall be entitled
to fund and maintain its funding of all or any part of its Pro Rata Share of the
Loan in any manner it may determine at its sole discretion. Each
Lender may, if it so elects, fulfill its commitment to make its advance of the
Loan by causing any office, branch or Affiliate of such Lender to make such
advance of the Loan; provided that in such event for the purposes of this
Agreement such advance of the Loan shall be deemed to have been made by such
Lender and the obligation of Borrower to repay such advance of the Loan shall
nevertheless be to such Lender and shall be deemed held by it, to the extent of
such Loan, for the account of such office, branch or Affiliate.
3.5. Mitigation of Circumstances;
Replacement of Lenders.
(a) Each
Lender shall promptly notify Borrower and Agent of any event of which it has
knowledge which will result in, and will use reasonable commercial efforts
available to it (and not, in such Lender’s sole judgment, otherwise
disadvantageous to such Lender) to mitigate or avoid, any obligation by Borrower
to pay any amount pursuant to Section 3.1 or 3.2. Without
limiting the foregoing, each Lender will designate a different funding office if
such designation will avoid (or reduce the cost to Borrower of) any event
described above and such designation would not, in such Lender’s sole judgment,
be otherwise disadvantageous to such Lender.
(b) If
(i) Borrower becomes obligated to pay additional amounts to any Lender pursuant
to Section 3.1
or 3.2, or (ii)
any Lender does not consent to any matter requiring its consent under Section 10.1 when the
Required Lenders have otherwise consented to such matter, then Borrower may
within 90 days thereafter designate another bank which is acceptable to Agent in
its reasonable discretion (such other bank being called a “Replacement Lender”)
to purchase the Pro Rata Share of the Loan of such Lender and such Lender’s
rights hereunder, without recourse to or warranty by, or expense to, such
Lender, for a purchase price equal to the outstanding principal amount of the
Pro Rata Share of the Loan payable to such Lender plus any accrued but unpaid
interest on such Pro Rata Share of the Loan and all accrued but unpaid
fees
owed to
such Lender and any other amounts payable to such Lender under this Agreement,
and to assume all the obligations of such Lender hereunder, and, upon such
purchase and assumption (pursuant to an Assignment Agreement), such Lender shall
no longer be a party hereto or have any rights hereunder (other than rights with
respect to indemnities and similar rights applicable to such Lender prior to the
date of such purchase and assumption) and shall be relieved from all obligations
to Borrower hereunder, and the Replacement Lender shall succeed to the rights
and obligations of such Lender hereunder.
3.6. Conclusiveness of
Statements; Survival.
(a) Determinations
and statements of any Lender pursuant to Section 3.1, 3.2, or 3.3 shall be
conclusive absent demonstrable error. Lenders may use reasonable
averaging and attribution methods in determining compensation under Sections 3.1, 3.2 and 3.3, and the
provisions of such Sections shall survive repayment of the Loan, cancellation of
the Notes and termination of this Agreement.
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Section
4.
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Conditions
Precedent.
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The
obligation of each Lender to make its Pro Rata Share of the Loan is subject to
the following conditions precedent, each of which shall be satisfactory in all
respects to Agent:
4.1. Credit
Extension.
The
obligation of Lenders to fund the Loan is subject to the following conditions
precedent, each of which shall be satisfactory in all respects to
Agent:
4.1.1. Omitted.
4.1.2. Omitted.
4.1.3. Interest and
Fees.
Borrower
shall have paid all interest, fees, costs and expenses due and payable under
this Agreement and the other Loan Documents on the Closing Date.
4.1.4. Delivery of Loan
Documents.
Borrower
shall have delivered the following documents in form and substance satisfactory
to Agent (and, as applicable, duly executed by all Persons named as parties
thereto and dated the Closing Date or an earlier date satisfactory to
Agent):
(a) Agreement. This
Agreement.
(b) Notes. A
Note, for each Lender requesting a Note.
(c) Collateral
Documents. The Guarantee and Collateral Agreement, all other
Collateral Documents, and all instruments, documents, certificates and
agreements executed or delivered pursuant thereto (including intellectual
property assignments and pledged equity
interests
in the Borrower and the Borrower’s Subsidiaries), with undated irrevocable
transfer powers executed in blank), in each case, executed and delivered by each
Loan Party and each other Person named as a party thereto.
(d) Financing
Statements. To the extent not completed pursuant to the
Original Credit Agreement, properly completed Uniform Commercial Code financing
statements and other filings and documents required by law or the Loan Documents
to provide Agent perfected Liens (subject only to Liens permitted pursuant to
Section 7.2) in
the Collateral.
(e) Lien
Searches. Copies of Uniform Commercial Code search reports
listing all effective financing statements filed against any Loan Party, with
copies of such financing statements.
(f) Omitted.
(g) Omitted.
(h) Omitted.
(i) Intercreditor
Agreement. An amendment to the Intercreditor Agreement,
executed and delivered by Agent, the holder of Senior Debt and the Loan Parties,
recognizing and giving effect to this Agreement.
(j) Omitted.
(k) Fee
Letter. The Fee Letter, executed and delivered by the Borrower
and Agent.
(l) Omitted.
(m) Authorization
Documents. For each Loan Party, such Person’s (i) charter (or
similar formation document), certified by the appropriate Governmental
Authority, (ii) good standing certificates in its state of incorporation (or
formation) and in each other state requested by Agent, (iii) limited liability
company agreement, partnership agreement, bylaws (and similar governing
document), (iv) resolutions of its board of directors (or similar governing
body) approving and authorizing such Person’s execution, delivery and
performance of the Loan Documents to which it is party and the transactions
contemplated thereby, and (v) signature and incumbency certificates of its
officers executing any of the Loan Documents, all certified by its secretary or
an assistant secretary (or similar officer) as being in full force and effect
without modification.
(n) Opinions of
Counsel. Opinions of counsel for each Loan Party, including
local Nevada and Arizona counsel, each in form and substance requested by
Agent.
(o) Insurance. Certificates
or other evidence of insurance in effect as required by Section 6.3(b), with
endorsements naming Agent as lenders’ loss payee and/or additional insured, as
applicable.
(p) Omitted.
(q) Omitted.
(r) Consents. Evidence
that all necessary consents, permits and approvals (governmental or otherwise)
required for the execution, delivery and performance by each Loan Party of the
Loan Documents have been duly obtained and are in full force and
effect.
(s) Omitted.
(t) Omitted.
(u) Subordination
Agreements. The Black Forest Subordination Agreement, executed
by Agent, the Loan Parties and Black Forest.
(v) Issuance of
Shares. Issuance to Fourth Third of the common stock of Parent
contemplated to be issued pursuant to the Share Exchange Agreement and the Share
Rights Agreement on the Closing Date in conformity with Section
4.1.9.
(w) Key Employment
Agreements. The Key Employees and Borrower shall have executed
the Key Employment Agreements.
(x) EBOF
Release. EBOF, together with ▇▇▇▇▇▇, shall have joined with
Agent in the execution of an acknowledgement, consent and release in respect
hereof.
(y) Castlerigg
Release. Castlerigg Master Investments, Ltd., as collateral
agent, shall have released its Liens on all assets of the Loan
Parties.
(z) Other
Documents. Such other certificates, documents and agreements
that may be listed on the closing checklist provided by Agent to the Borrower or
as Agent or any Lender may reasonably request.
4.1.5. Representations and
Warranties
. Each
representation and warranty by each Loan Party contained herein or in any other
Loan Document shall be true and correct in all material respects (without
duplication of any materiality qualifier contained therein) as of the Closing
Date.
4.1.6. No
Default
. No
Default or Event of Default shall have occurred and be continuing.
4.1.7. Diligence
. The
Agent shall have completed, to its satisfaction, its remaining due diligence,
which includes review of equipment appraisals, obtaining management background
checks, and legal diligence, with the results thereof satisfactory to the
Agent.
4.1.8. No Material Adverse
Change
. Since
the applicable Last Pre Closing Audit Date, there has been no material adverse
change in the operations, assets, business, properties, prospects or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole
or the Parent and its Subsidiaries taken as a whole.
4.1.9. Reservation
of Shares
. Parent
shall have authorized and reserved for issuance to Fourth Third that number of
shares of the common stock of Parent necessary for the purpose of issuance to
Fourth Third the amount thereof contemplated by the Share Exchange Agreement and
the Share Rights Agreement at and after the Closing Date (as applicable),
representing at least 1,100,000 such shares, as of the Closing
Date. Parent shall take all such actions as may be necessary to
assure that all such shares of common stock may be issued without violation of
any applicable law or governmental regulation or any requirements of any
domestic securities exchange upon which such shares are or will be
listed.
4.1.10. Drop Down and Share
Exchange
. The
Agent shall have received evidence satisfactory to it that: (i) the
Drop Down and the Share Exchange have occurred on terms satisfactory to the
Agent; and (ii) all consents of all Persons, including the holder of the Senior
Debt and Black Forest, have been obtained.
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Section
5.
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Representations and
Warranties.
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To induce
Agent and Lenders to enter into this Agreement and to induce Lenders to make
their Pro Rata Shares of the Loan hereunder, Borrower represents and warrants to
Agent and Lenders as follows.
5.1. Organization.
Borrower
is a limited liability company validly existing and in good standing under the
laws of the State of Delaware; each other Loan Party is validly existing and in
good standing under the laws of the jurisdiction of its organization; and each
Loan Party is duly qualified to do business in each jurisdiction where, because
of the nature of its activities or properties, such qualification is required,
except for such jurisdictions where the failure to so qualify could not
reasonably be expected to have a Material Adverse Effect.
5.2. Authorization; No
Conflict.
Each of
Borrower and each other Loan Party is duly authorized to execute and deliver
each Loan Document to which it is a party, Borrower is duly authorized to borrow
monies hereunder, and each of Borrower and each other Loan Party is duly
authorized to perform its Obligations under each Loan Document to which it is a
party. The execution, delivery and performance by Borrower of this
Agreement and by each of Borrower, each Loan Party of each Loan Document to
which it is a party, and the borrowings by Borrower hereunder, do not and will
not (a) require any consent or approval of any governmental agency or authority
(other than any consent or approval which has been obtained and is in full force
and effect), (b) conflict with (i) any provision of applicable law, (ii) the
charter, by-laws, limited liability company agreement, partnership agreement or
other organizational documents of any Loan Party or (iii) any agreement,
indenture, instrument or other document, or any judgment, order or decree, which
is binding upon any Loan Party or any of their respective properties or (c)
require, or result in, the creation or imposition of any Lien on any asset of
Borrower, any Loan Party (other than Liens in favor of Agent created pursuant to
the Collateral Documents).
5.3. Validity;
Binding Nature.
Each of
this Agreement and each other Loan Document to which Borrower or any other Loan
Party is a party is the legal, valid and binding obligation of such Person,
enforceable against such Person in accordance with its terms, subject to
bankruptcy, insolvency and similar laws affecting the enforceability of
creditors’ rights generally and to general principles of equity.
5.4. Financial
Condition.
(a) The
audited consolidated financial statements of Borrower and its Subsidiaries
(presented on a consolidated basis with the audited financial statements of
Apollo Resources International, Inc.) as at December 31, 2007, copies of each of
which have been delivered pursuant hereto, were prepared in accordance with GAAP
(subject, in the case of such unaudited statements, to the absence of footnotes
and to normal year-end adjustments) and present fairly the consolidated
financial condition of such Persons as at such dates and the results of their
operations for the periods then ended.
(b) The
consolidated financial projections (including an operating budget and a cash
flow budget) of Parent and Borrower and their respective
Subsidiaries for the 2 year period commencing June 1, 2008 delivered to Agent
and Lenders on or prior to the Closing Date (i) were prepared by Parent
and Borrower, respectively, in good faith and (ii)
were prepared in accordance with assumptions for which Parent and Borrower,
respectively, has a
reasonable basis, and the accompanying consolidated pro forma balance sheets of
Parent and Borrower and their respective
Subsidiaries as at the Closing Date, adjusted to give effect to the consummation
of the financing contemplated hereby as if such transactions had occurred on
such date, is consistent in all material respects with such
projections.
5.5. No Material Adverse
Change.
Since the
applicable Last Pre Closing Audit Date, there has been no material adverse
change in the operations, assets, business, properties, prospects or condition
(financial or otherwise) of the Borrower and its Subsidiaries taken as a whole
or of the Parent and its Subsidiaries taken as a whole.
5.6. Litigation
. No
litigation (including derivative actions), arbitration proceeding or
governmental investigation or proceeding is pending or, to Borrower’s knowledge,
threatened against any Loan Party which could reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect, except as
set forth in Schedule
5.6. As of the Closing Date and the Amendment No. 2 Effective
Date, other than any liability incident to such litigation or proceedings,
neither Borrower nor any other Loan Party has any material Contingent
Obligations not listed on Schedule
7.1.
5.7. Ownership of Properties;
Liens.
Each of
Borrower and each other Loan Party owns good and, in the case of real property,
marketable title to all of its properties and assets, real and personal,
tangible and intangible, of any nature whatsoever (including patents,
trademarks, trade names, service marks and copyrights), free and clear of all
Liens, charges and claims (including infringement claims with
respect
to patents, trademarks, service marks, copyrights and the like), except as
permitted by Section
7.2.
5.8. Capitalization.
All
issued and outstanding equity securities of the Loan Parties are duly authorized
and validly issued, fully paid and non-assessable, and such securities were
issued in compliance with all applicable state and federal laws concerning the
issuance of securities. All issued and outstanding equity securities
of the Loan Party Subsidiaries are free and clear of all Liens other than those
in favor of Agent. Schedule 5.8 sets
forth the authorized equity securities of each Loan Party as of the Closing
Date. All of the issued and outstanding equity of Borrower is owned
by Parent, and all of the issued and outstanding equity of each of the
Borrower’s Subsidiaries is, directly or indirectly, owned by
Borrower. As of the Closing Date, except as set forth on Schedule 5.8, there
are no pre-emptive or other outstanding rights, options, warrants, conversion
rights or other similar agreements or understandings for the purchase or
acquisition of any equity interests of any Loan Party.
5.9. Pension
Plans.
During
the twelve-consecutive-month period prior to the Closing Date or the making of
the Loan, (i) no steps have been taken to terminate any Pension Plan and (ii) no
contribution failure has occurred with respect to any Pension Plan sufficient to
give rise to a Lien under Section 302(f) of ERISA. No condition
exists or event or transaction has occurred with respect to any Pension Plan
which could result in the incurrence by Borrower or any other Loan Party of any
material liability, fine or penalty. All contributions (if any) have
been made to any Multiemployer Pension Plan that are required to be made by any
Loan Party or any other member of the Controlled Group under the terms of the
plan or of any collective bargaining agreement or by applicable law; neither any
Loan Party nor any member of the Controlled Group has withdrawn or partially
withdrawn from any Multiemployer Pension Plan, incurred any withdrawal liability
with respect to any such plan or received notice of any claim or demand for
withdrawal liability or partial withdrawal liability from any such plan, and no
condition has occurred which, if continued, could result in a withdrawal or
partial withdrawal from any such plan, and neither any Loan Party nor any member
of the Controlled Group has received any notice that any Multiemployer Pension
Plan is in reorganization, that increased contributions may be required to avoid
a reduction in plan benefits or the imposition of any excise tax, that any such
plan is or has been funded at a rate less than that required under Section 412
of the IRC, that any such plan is or may be terminated, or that any such plan is
or may become insolvent.
5.10. Compliance with Law;
Investment Company Act; Other Regulated Entities.
Borrower
and each other Loan Party possesses all necessary authorizations, permits,
licenses and approvals from all Governmental Authorities in order to conduct
their respective businesses as presently conducted. All business and
operations of the Borrower and each other Loan Party complies with all
applicable federal, state and local laws and regulations, except where the
failure so to comply could not reasonably be expected to result in a Material
Adverse Effect. Neither the Borrower nor any other Loan Party is
operating any aspect of its business
under any
agreement, settlement, order or other arrangement with any Governmental
Authority. Neither Borrower nor any other Loan Party is an “investment company”
or a company “controlled” by an “investment company” or a “subsidiary” of an
“investment company”, within the meaning of the Investment Company Act of
1940. None of any Loan Party, any Person controlling any Loan Party,
or any Subsidiary of any Loan Party, is subject to regulation under the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal or state statute, rule or regulation limiting its ability to incur
Indebtedness, pledge its assets or perform its Obligations under the Loan
Documents.
5.11. Margin
Stock.
Neither
Borrower nor any Loan Party is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock. No portion of the Obligations is secured
directly or indirectly by Margin Stock.
5.12. Taxes.
Each of
Borrower and each other Loan Party and each Non-Loan Party has filed all
federal, state, local and foreign income and franchise and other material tax
returns, reports and statements (collectively, the “Tax Returns”) with
the appropriate governmental authorities in all jurisdictions in which such Tax
Returns are or were required to be filed. All such Tax Returns are true and
correct in all material respects. All Taxes, charges and other impositions
reflected therein or otherwise due and payable have been paid prior to the date
on which any liability may be added thereto for non-payment thereof, except for
those contested in good faith by appropriate proceedings diligently conducted
and for which adequate reserves are maintained on the books of the appropriate
Loan Party or Non-Loan Party, as applicable, in accordance with
GAAP. Except as specifically disclosed in Schedule 5.12, no Tax
Return is 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 have been withheld by each Loan Party or Non-Loan Party, as applicable,
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. No Loan Party or
Non-Loan Party has participated in a “reportable transaction” within the meaning
of Treasury Regulation Section 1.6011-4(b) or has been a member of an
affiliated, combined or unitary group other than the group of which a Loan Party
is the common parent.
5.13. Solvency.
On the
Closing Date, with respect to each of Borrower and each other Loan Party,
individually, (a) the fair value of its assets is greater than the amount of its
liabilities (including disputed, contingent and unliquidated liabilities) as
such value is established and liabilities evaluated, (b) the present fair
saleable value of its assets is not less than the amount that will be required
to pay the probable liability on its debts as they become absolute and matured,
(c) it is able to realize upon its assets and pay its debts and other
liabilities (including disputed, contingent and unliquidated liabilities) as
they mature in the normal course of business, (d) it does not intend to, and
does not believe that it will, incur debts or liabilities beyond its ability
to
pay as
such debts and liabilities mature and (e) it is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for which
its property would constitute unreasonably small capital.
5.14. Environmental
Matters.
The
on-going operations of Borrower and each other Loan Party comply in all respects
with all Environmental Laws, except such non-compliance which could not (if
enforced in accordance with applicable law) reasonably be expected to result in
a Material Adverse Effect. Borrower and each other Loan Party have
obtained, and maintained in good standing, all licenses, permits, authorizations
and registrations required under any Environmental Law and necessary for their
respective ordinary course operations, and Borrower and each other Loan Party
are in compliance with all material terms and conditions thereof, except where
the failure to do so could not reasonably be expected to result in material
liability to Borrower or any other Loan Party and could not reasonably be
expected to result in a Material Adverse Effect. Except as set forth
on Schedule
5.14, none of Borrower, any other Loan Party or any of their respective
properties or operations is subject to any outstanding written order from or
agreement with any Federal, state or local Governmental Authority, nor subject
to any judicial or docketed administrative proceeding, nor subject to any
indemnification agreement or other contractual obligation, respecting any
Environmental Law, Environmental Claim or Hazardous Substance. There
are no Hazardous Substances or other conditions or circumstances existing with
respect to any property, or arising from operations prior to the Closing Date
and the Amendment No. 2 Effective Date, of Borrower or any other Loan Party that
could reasonably be expected to result in a Material Adverse
Effect. Neither Borrower nor any other Loan Party has any underground
or above ground storage tanks that are not properly registered or permitted
under applicable Environmental Laws or that are leaking or disposing of
Hazardous Substances.
5.15. Insurance.
Borrower
and each other Loan Party and their respective properties are insured with
financially sound and reputable insurance companies which are not Affiliates of
Borrower, in such amounts, with such deductibles and covering such risks as are
customarily carried by companies engaged in similar businesses and owning
similar properties in localities where Borrower or such other Loan Party
operates. A true and complete listing of such insurance as of the
Closing Date, including issuers, coverages and deductibles, is set forth on
Schedule
5.15.
5.16. Information.
All
information heretofore or contemporaneously herewith furnished in writing by
Borrower or any other Loan Party to Agent or any Lender for purposes of or in
connection with this Agreement and the transactions contemplated hereby is, and
all written information hereafter furnished by or on behalf of Borrower or any
Loan Party to Agent or any Lender pursuant hereto or in connection herewith will
be, true and accurate in every material respect on the date as of which such
information is dated or certified, and none of such information is or will be
incomplete by omitting to state any material fact necessary to make such
information not misleading in light of the circumstances under which made (it
being recognized by Agent and Lenders that any projections and forecasts
provided by Borrower are based on good faith
estimates
and assumptions believed by Borrower to be reasonable as of the date of the
applicable projections or assumptions and that actual results during the period
or periods covered by any such projections and forecasts may differ from
projected or forecasted results).
5.17. Intellectual
Property.
Borrower
and each other Loan Party owns and possesses or has a license or other right to
use all patents, patent rights, trademarks, trademark rights, trade names, trade
name rights, service marks, service ▇▇▇▇ rights and copyrights as are necessary
for the conduct of the business of Borrower and the other Loan Parties, without
any infringement upon rights of others which could reasonably be expected to
have a Material Adverse Effect.
5.18. Labor
Matters.
Except as
set forth on Schedule
5.18, neither Borrower nor any other Loan Party is subject to any labor
or collective bargaining agreement. There are no existing or
threatened strikes, lockouts or other labor disputes involving Borrower or any
other Loan Party that singly or in the aggregate could reasonably be expected to
have a Material Adverse Effect. Hours worked by and payment made to
employees of Borrower and the other Loan Parties are not in violation of the
Fair Labor Standards Act or any other applicable law, rule or regulation dealing
with such matters.
5.19. No
Default.
No Event
of Default or Default exists or would result from the incurrence by any Loan
Party of any Debt hereunder or under any other Loan Document.
5.20. Foreign Assets Control
Regulations and Anti-Money Laundering.
5.20.1. OFAC.
Neither
any Loan Party nor any Subsidiary of any Loan Party (i) is a person whose
property or interest in property is blocked or subject to blocking pursuant to
Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism (66 Fed. Reg. 49079 (2001) (“Executive Order
13224”), (ii) engages in any dealings or transactions prohibited by
Section 2 of such executive order, or is otherwise associated with any such
person in any manner violative of Section 2, or (iii) is a person on the list of
Specially Designated Nationals and Blocked Persons or subject to the limitations
or prohibitions under any other U.S. Department of Treasury’s Office of Foreign
Assets Control regulation or executive order.
5.20.2. Patriot
Act.
Each Loan
Party and each of their respective Subsidiaries is in compliance, in all
material respects, with the Patriot Act. No part of the proceeds of
the Loan will be used, directly or indirectly, for any payments to any
governmental official or employee, political party, official of a political
party, candidate for political office, or anyone else acting in an official
capacity, in
order to
obtain, retain or direct business or obtain any improper advantage, in violation
of the United States Foreign Corrupt Practices Act of 1977, as
amended.
5.21. Gas Supply and Hedge
Contracts.
Each of
the Gas Supply and Hedge Contracts is in full force and effect and constitutes
the legal, valid, binding and enforceable obligation of each party
thereto.
|
Section
6.
|
Affirmative
Covenants.
|
Until all
Obligations (other than contingent indemnification obligations to the extent no
claim giving rise thereto has been asserted) are Paid in Full, each Loan Party
agrees that, unless at any time Required Lenders shall otherwise expressly
consent in writing, it will:
6.1. Information.
Furnish
to Agent and each Lender:
6.1.1. Annual
Report.
Promptly
when available and in any event within 90 days after the close of each Fiscal
Year: a copy of the annual audit report of Parent and its Subsidiaries for
such Fiscal Year, including therein a consolidated balance sheet and statement
of earnings and cash flows of Borrower and the Subsidiaries as at the end of
such Fiscal Year, certified without qualification by independent auditors of
recognized standing selected by Borrower and reasonably acceptable to
Agent.
6.1.2. Interim
Reports.
Promptly
when available and in any event within 30 days after the end of each month,
consolidated balance sheets of Parent and Borrower and their respective
Subsidiaries as of the end of such month, together with consolidated statements
of earnings and a consolidated statement of cash flows for such month and for
the period beginning with the first day of such Fiscal Year and ending on the
last day of such month, together with a comparison with the corresponding period
of the previous Fiscal Year and a comparison with the budget for such period of
the current Fiscal Year, certified by the chief financial officers of Parent and
Borrower.
6.1.3. Compliance
Certificate.
Contemporaneously
with the furnishing of a copy of each annual audit report pursuant to Section 6.1.1 and
each set of statements pursuant to Section 6.1.2 for the
last month of each calendar quarter (beginning with the calendar quarter ending
June 30, 2008) a duly completed Compliance Certificate, with appropriate
insertions, dated the date of such annual report or such monthly statements, and
signed by the chief financial officer of Borrower, containing a computation of
each of the financial ratios and restrictions set forth in Section 7.14 and to
the effect that such officer has not become aware of any Event of Default or
Default that has occurred and is continuing or, if there is any such event,
describing it and the steps, if any, being taken to cure it.
6.1.4. Reports
to SEC and Shareholders.
Promptly
upon the filing or sending thereof, copies of (a) all regular, periodic or
special reports of each Loan Party filed with the Securities Exchange
Commission, (b) all registration statements of each Loan Party filed with the
Securities Exchange Commission (other than on Form S-8) and (c) all proxy
statements or other communications made to security holders
generally.
6.1.5. Notice of Default;
Litigation; ERISA Matters.
Promptly
upon becoming aware of any of the following, written notice describing the same
and the steps being taken by Borrower or the applicable Loan Party affected
thereby with respect thereto:
(a) the
occurrence of an Event of Default or a Default;
(b) any
litigation, arbitration or governmental investigation or proceeding not
previously disclosed by Borrower to Lenders which has been instituted or, to the
knowledge of Borrower, is threatened against Borrower or any other Loan Party or
to which any of the properties of any thereof is subject which could reasonably
be expected to have a Material Adverse Effect;
(c) the
institution of any steps by any member of the Controlled Group or any other
Person to terminate any Pension Plan, or the failure of any member of the
Controlled Group to make a required contribution to any Pension Plan (if such
failure is sufficient to give rise to a Lien under Section 302(f) of ERISA) or
to any Multiemployer Pension Plan, or the taking of any action with respect to a
Pension Plan which could result in the requirement that Borrower or any other
Loan Party furnish a bond or other security to the PBGC or such Pension Plan, or
the occurrence of any event with respect to any Pension Plan or Multiemployer
Pension Plan which could result in the incurrence by any member of the
Controlled Group of any material liability, fine or penalty (including any claim
or demand for withdrawal liability or partial withdrawal from any Multiemployer
Pension Plan), or any material increase in the contingent liability of Borrower
or any other Loan Party with respect to any post-retirement welfare plan
benefit, or any notice that any Multiemployer Pension Plan is in reorganization,
that increased contributions may be required to avoid a reduction in plan
benefits or the imposition of an excise tax, that any such plan is or has been
funded at a rate less than that required under Section 412 of the IRC, that any
such plan is or may be terminated, or that any such plan is or may become
insolvent;
(d) any
cancellation or material adverse change in any insurance maintained by Borrower
or any other Loan Party; or
(e) any
other event (including (i) any violation of any Environmental Law or the
assertion of any Environmental Claim or (ii) the enactment or effectiveness of
any law, rule or regulation) which could reasonably be expected to have a
Material Adverse Effect.
6.1.6. Management
Report.
Promptly
upon receipt thereof, copies of all detailed financial and management reports
submitted to Borrower or any other Loan Party by independent auditors in
connection with each annual or interim audit made by such auditors of the books
of Borrower or any other Loan Party.
6.1.7. Projections.
As soon
as practicable, and in any event not later than 30 days after the commencement
of each Fiscal Year, financial projections for Parent and Borrower and their
respective Subsidiaries for such Fiscal Year (including monthly operating and
cash flow budgets) prepared in a manner consistent with the projections
delivered by Parent and Borrower, respectively, to Agent prior to the Closing
Date or otherwise in a manner reasonably satisfactory to Agent, accompanied by a
certificate of a chief financial officers of Parent and Borrower to the effect that (a)
such projections were prepared by Parent and Borrower, respectively, in good faith, (b)
Parent and Borrower, respectively, has a reasonable basis for the assumptions
contained in such projections and (c) such projections have been prepared in
accordance with such assumptions.
6.1.8. Other
Information.
Promptly
from time to time, such other information concerning Borrower and any other Loan
Party as any Lender or Agent may reasonably request.
6.2. Books; Records;
Inspections.
Keep, and
cause each other Loan Party to keep, its books and records in accordance with
sound business practices sufficient to allow the preparation of financial
statements in accordance with GAAP; permit, and cause each other Loan Party to
permit, Agent (accompanied by any Lender) or any representative thereof to
inspect the properties and operations of Borrower or such other Loan Party; and
permit, and cause each other Loan Party to permit, at any reasonable time and
with reasonable notice (or at any time without notice if an Event of Default
exists), Agent (accompanied by any Lender) or any representative thereof to
visit any or all of its offices, to discuss its financial matters with its
officers and its independent auditors (and Borrower hereby authorizes such
independent auditors to discuss such financial matters with any Lender or Agent
or any representative thereof), and to examine (and, at the expense of Borrower
or the applicable Loan Party, photocopy extracts from) any of its books or other
records; and permit, and cause each other Loan Party to permit, Agent and its
representatives to inspect the Collateral and other tangible assets of Borrower
or such Loan Party, to perform appraisals of the equipment of Borrower or such
Party, and to inspect, audit, check and make copies of and extracts from the
books, records, computer data, computer programs, journals, orders, receipts,
correspondence and other data relating to any Collateral.
6.3. Maintenance of Property;
Insurance.
(a) Keep,
and cause each other Loan Party to keep, all property useful and necessary in
the business of Borrower or such other Loan Party in good working order and
condition, ordinary wear and tear excepted.
(b) Maintain,
and cause each other Loan Party to maintain, with responsible insurance
companies, such insurance coverage as shall be required by all laws,
governmental regulations and court decrees and orders applicable to it and such
other insurance, to such extent and against such hazards and liabilities, as is
customarily maintained by companies similarly situated; provided that in any
event, such insurance shall insure against all risks and liabilities of the type
insured against as of the Closing Date and shall have insured amounts no less
than, and deductibles no higher than, those amounts provided for as of the
Closing Date. Upon request of Agent or any Lender, Borrower shall
furnish to Agent or such Lender a certificate setting forth in reasonable detail
the nature and extent of all insurance maintained by Borrower and each other
Loan Party. Borrower shall cause each issuer of an insurance policy
to provide Agent with an endorsement (i) showing Agent as a loss payee with
respect to each policy of property or casualty insurance and naming Agent as an
additional insured with respect to each policy of liability insurance, (ii)
providing that 30 days’ notice will be given to Agent prior to any cancellation
of, or reduction or change in coverage provided by or other material
modification to such policy and (iii) reasonably acceptable in all other
respects to Agent. Borrower shall execute and deliver to Agent a
collateral assignment, in form and substance satisfactory to Agent, of each
business interruption insurance policy maintained by the Loan
Parties.
(c) Unless
Borrower provides Agent with evidence of the continuing insurance coverage
required by this Agreement, Agent may purchase insurance at Borrower’s expense
to protect Agent’s and Lenders’ interests in the Collateral. This
insurance may, but need not, protect Borrower’s and each other Loan Party’s
interests. The coverage that Agent purchases may, but need not, pay
any claim that is made against Borrower or any other Loan Party in connection
with the Collateral. Borrower may later cancel any insurance
purchased by Agent, but only after providing Agent with evidence that Borrower
has obtained the insurance coverage required by this Agreement. If
Agent purchases insurance for the Collateral, as set forth above, Borrower will
be responsible for the costs of that insurance, including interest and any other
charges that may be imposed with the placement of the insurance, until the
effective date of the cancellation or expiration of the insurance and the costs
of the insurance may be added to the principal amount of the Loan owing
hereunder.
6.4. Compliance with Laws;
Payment of Taxes and Liabilities.
(a) Comply,
and cause each other Loan Party to comply, in all material respects with all
applicable laws, rules, regulations, decrees, orders, judgments, licenses and
permits, except where failure to comply could not reasonably be expected to have
a Material Adverse Effect; (b) without limiting clause (a) above, ensure, and
cause each other Loan Party to ensure, that no person who owns a controlling
interest in or otherwise controls a Loan Party is or shall be (i) listed on the
Specially Designated Nationals and Blocked Person List maintained by the Office
of Foreign Assets Control (“OFAC”), Department of
the Treasury, and/or any other similar lists maintained by OFAC pursuant to any
authorizing statute, Executive Order or regulation or (ii) a person designated
under Section
1(b), (c) or (d) or Executive
Order 13224, any related enabling legislation or any other similar Executive
Orders; (c) without limiting clause (a) above, comply and cause each other Loan
Party to comply, with all applicable Bank Secrecy Act and anti-money laundering
laws and regulations and (d) timely prepare and file all Tax Returns required to
be filed by applicable law and pay, and cause each other Loan Party to pay,
prior to delinquency, all taxes and other governmental charges against it or any
of its property, as
well as
claims of any kind which, if unpaid, could become a Lien on any of its property;
provided that the foregoing shall not require Borrower or any other Loan Party
to pay any such tax or charge so long as it shall contest the validity thereof
in good faith by appropriate proceedings and shall set aside on its books
adequate reserves with respect thereto in accordance with GAAP.
6.5. Maintenance of
Existence.
Maintain
and preserve, and (subject to Section 7.5) cause
each other Loan Party to maintain and preserve, (a) its existence and good
standing in the jurisdiction of its organization and (b) its qualification to do
business and good standing in each jurisdiction where the nature of its business
makes such qualification necessary, other than any such jurisdiction where the
failure to be qualified or in good standing could not reasonably be expected to
have a Material Adverse Effect.
6.6. Employee Benefit
Plans.
Maintain,
and cause each other Loan Party to maintain, each Pension Plan in substantial
compliance with all applicable requirements of law and regulations.
6.7. Environmental
Matters.
If any
release or disposal of Hazardous Substances shall occur or shall have occurred
on or from any real property or any other assets of Borrower or any other Loan
Party, cause, or direct the applicable Loan Party to cause, the prompt
containment and removal of such Hazardous Substances and the remediation of such
real property or other assets as is necessary to comply with all Environmental
Laws and to preserve the value of such real property or other
assets. Without limiting the generality of the foregoing, Borrower
shall, and shall cause each other Loan Party to, comply with each valid Federal
or state judicial or administrative order requiring the performance at any real
property by Borrower or any other Loan Party of activities in response to the
release or threatened release of a Hazardous Substance. If any
violation of any Environmental Law shall occur or shall have occurred at any
real property or any other assets of Borrower or any other Loan Party or
otherwise in connection with their operations, cause, or direct the applicable
Loan Party to cause, the prompt correction of such violation.
6.8. Further
Assurances.
(a) Promptly
upon request by the Agent, the Loan Parties shall (and, subject to the
limitations hereinafter set forth, shall cause each of their Subsidiaries to)
take such additional actions as the Agent may reasonably require from time to
time in order (i) to carry out more effectively the purposes of this Agreement
or any other Loan Document, (ii) to subject to the Liens created by any of the
Collateral Documents any of the properties, rights or interests covered by any
of the Collateral Documents, (iii) to perfect and maintain the validity,
effectiveness and priority of any of the Collateral Documents and the Liens
intended to be created thereby, and (iv) to better assure, convey, grant,
assign, transfer, preserve, protect and confirm to the Agent and Lenders the
rights granted or now or hereafter intended to be granted to the Agent and the
Lenders under any Loan Document or under any other document executed in
connection therewith. Without limiting the generality of the
foregoing and except as otherwise
approved
in writing by Required Lenders, the Loan Parties shall cause each of their
Domestic Loan Party Subsidiaries to guaranty the Obligations and cause each such
Subsidiary to grant to the Agent, for the benefit of the Agent and Lenders, a
security interest in, subject to the limitations hereinafter set forth, all of
such Subsidiary’s Property to secure such guaranty. Furthermore and
except as otherwise approved in writing by Required Lenders, Parent shall pledge
the Stock and Stock Equivalents of Borrower, and each Loan Party Subsidiary
shall, and shall cause (x) each of its Domestic Loan Party Subsidiaries to,
pledge all of the Stock and Stock Equivalents of each of its Domestic Loan Party
Subsidiaries and sixty-five percent (65%) of the outstanding voting Stock and
Stock Equivalents and one hundred percent (100%) of the outstanding non-voting
Stock and Stock Equivalents) of Foreign Subsidiaries owned directly by a Loan
Party Subsidiary, in each instance, to the Agent, for the benefit of the Agent
and Lenders, to secure the Obligations. In connection with each
pledge of Stock and Stock Equivalents, such Loan Party Subsidiary shall deliver,
or cause to be delivered, to the Agent, irrevocable proxies and stock powers
and/or assignments, as applicable, duly executed in blank. In the
event any Loan Party (other than Parent) acquires or leases as lessee any real
Property, simultaneously with such acquisition, such Person shall execute and/or
deliver, or cause to be executed and/or delivered, to the Agent, (x) a fully
executed Mortgage, in form and substance reasonably satisfactory to the Agent
together with in the case of a lease, such lease amendments, consents and/or
estoppels as Agent may reasonably request, and in any event, together with an
A.L.T.A. lender’s title insurance policy issued by a title insurer reasonably
satisfactory to the Agent, in form and substance and in an amount reasonably
satisfactory to the Agent insuring that the Mortgage is a valid and enforceable
first priority Lien on the respective property, free and clear of all defects,
encumbrances and Liens, (y) then current A.L.T.A. surveys, certified to the
Agent and the Lenders by a licensed surveyor sufficient to allow the issuer of
the lender’s title insurance policy to issue such policy without a survey
exception and (z) an environmental site assessment prepared by a qualified firm
reasonably acceptable to the Agent, in form and substance satisfactory to the
Agent.
(b) Within
thirty (30) days after the Closing Date, to the extent not heretofore delivered
to Agent pursuant to the Original Credit Agreement, the Loan Parties shall
deliver to Agent a deposit account or securities account, as applicable, Control
Agreement for each deposit account and securities account maintained by any Loan
Party Subsidiary (other than zero balance payroll and similar accounts and other
than the “Lock-Box Account” (as such term is defined in the Intercreditor
Agreement)), in form and substance satisfactory to the Agent.
(c) Within
thirty (30) days following the Closing Date, the Borrower shall execute and
deliver an amendment to the Mortgage, dated as of February 28, 2007 (as
heretofore amended), by Borrower to Agent, in form and substance satisfactory to
Agent, to the extent necessary in the opinion of Agent to insure that the Loan
is secured by such Mortgage and to obtain at Borrower’s expense, an endorsement,
in form and substance satisfactory to Agent, to the title insurance policy
issued to Agent as to such Mortgage, which among other things insures that such
Mortgage secures such Loan.
(d) Within
thirty (30) days after the Closing Date, to the extent not heretofore delivered
to Agent pursuant to the Original Credit Agreement, at their own cost and
expense, the Loan Parties shall cause applications to be filed with the
appropriate motor vehicle authorities to
cause all
certificates of title for Titled Vehicles owned as of the Closing Date by any
Loan Party Subsidiary to indicate the name of the Agent as sole
lienholder.
6.9. Collateral Access
Agreements.
To the
extent not heretofore completed pursuant to the Original Credit Agreement, each
Loan Party Subsidiary shall use commercially reasonable efforts to obtain a
Collateral Access Agreement from the lessor of each leased property, bailee in
possession of any Collateral or mortgage of any owned property with respect to
each location where any Collateral is stored or located, which Collateral Access
Agreement shall be reasonably satisfactory in form and substance to
Agent.
6.10. Board Observation
Rights.
Fourth
Third shall have the right to appoint a single observer to the board of
directors or similar governing body of each Loan Party (the “Board of Directors”),
who shall be entitled to attend (or at the option of such observer, monitor by
telephone) all meetings of such Board of Directors and each committee of such
Board of Directors, but shall not be entitled to vote, or to influence any vote,
and who shall receive all reports, meeting materials, notices, written consents,
and other materials as and when provided to the members of such Board of
Directors. The Loan Parties shall reimburse Fourth Third for the
reasonable travel expenses incurred by any such observer appointed by Fourth
Third in connection with attendance at or participation in meetings of such Loan
Party’s Board of Directors to the extent consistent with such Loan Party’s
policies of reimbursing directors generally for such expenses.
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Section
7.
|
Negative
Covenants.
|
Until the
Obligations (other than contingent indemnification obligations to the extent no
claim giving rise thereto has been asserted) are Paid in Full, each Domestic
Loan Party Subsidiary agrees that, unless at any time Required Lenders shall
otherwise expressly consent in writing, it will:
7.1. Debt.
Not, and
not suffer or permit any other Loan Party Subsidiary to, create, incur, assume
or suffer to exist any Debt, except:
(a) Obligations
under this Agreement and the other Loan Documents;
(b) Debt
secured by Liens permitted by Section 7.2(d), and
extensions, renewals and refinancings thereof; provided that the aggregate
principal amount of all such Debt at any time outstanding shall not exceed
$1,000,000;
(c) Debt
of Borrower to any Wholly-Owned Domestic Subsidiary of Borrower or Debt of any
Wholly-Owned Domestic Subsidiary of Borrower to Borrower or another Wholly-Owned
Domestic Subsidiary of Borrower; provided that all such Debt shall be evidenced
by a demand note in form and substance reasonably satisfactory to Agent and
pledged and (subject to any contrary provision of the Intercreditor Agreement)
delivered to Agent
pursuant
to the Guarantee and Collateral Agreement as additional collateral security for
the Obligations, and the obligations under such demand note shall be
subordinated to the Obligations hereunder in a manner reasonably satisfactory to
Agent;
(d) Debt
described on Schedule
7.1 as of the Closing Date, and any extension, renewal or refinancing
thereof so long as the principal amount thereof is not increased;
(e) Senior
Debt of Borrower and its Subsidiaries in an aggregate principal amount not
exceeding that permitted by the Intercreditor Agreement.
(f) Contingent
Obligations arising with respect to customary indemnification obligations in
favor of purchasers in connection with dispositions permitted under Section
7.5;
(g) Debt
arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument drawn against insufficient funds in the ordinary
course of business, provided that such Debt is extinguished within two (2)
Business Days of notice to Borrower or the relevant Subsidiary of its
incurrence;
(h) Debt
incurred in connection with the financing of insurance premiums in the ordinary
course of business;
(i) guaranties
by Borrower of the Debt of any Wholly-Owned Domestic Subsidiary of Borrower or
guaranties by any Subsidiary thereof of the Debt of Borrower in each case so
long as such Debt is permitted under this Section
7.1;
(j) Omitted;
(k) the
Black Forest Debt, inclusive of the Contingent Obligations arising under the
Black Forest Guaranty; and
(l) other
unsecured Debt, in addition to the Debt listed above, in an aggregate principal
outstanding amount not at any time exceeding $2,000,000.
7.2. Liens.
Not, and
not suffer or permit any other Loan Party Subsidiary to, create or permit to
exist any Lien on any of its real or personal properties, assets or rights of
whatsoever nature (whether now owned or hereafter acquired),
except:
(a) Liens
for taxes or other governmental charges not at the time delinquent or thereafter
payable without penalty or being diligently contested in good faith by
appropriate proceedings and, in each case, for which it maintains adequate
reserves in accordance with GAAP and the execution or other enforcement of which
is effectively stayed;
(b) Liens
arising in the ordinary course of business (such as (i) Liens of carriers,
warehousemen, mechanics, landlords and materialmen and other similar Liens
imposed by law and (ii) Liens consisting of pledges or deposits incurred in
connection with worker’s compensation, unemployment compensation and other types
of social security (excluding Liens
arising
under ERISA) or in connection with surety bonds, bids, performance bonds and
similar obligations) for sums not overdue or being diligently contested in good
faith by appropriate proceedings and not involving any deposits or advances or
borrowed money or the deferred purchase price of property or services and, in
each case, for which it maintains adequate reserves in accordance with GAAP and
the execution or other enforcement of which is effectively stayed;
(c) Liens
described on Schedule
7.2 as of the Closing Date;
(d) subject
to the limitation set forth in Section 7.1(c), (i)
Liens arising in connection with Capital Leases (and attaching only to the
property being leased), (ii) Liens existing on property at the time of the
acquisition thereof by Borrower or any Subsidiary (and not created in
contemplation of such acquisition) and (iii) Liens that constitute purchase
money security interests on any property securing debt incurred for the purpose
of financing all or any part of the cost of acquiring such property, provided
that any such Lien attaches to such property within 60 days of the acquisition
thereof and attaches solely to the property so acquired;
(e) attachments,
appeal bonds, judgments and other similar Liens, for sums not exceeding $250,000
arising in connection with court proceedings; provided that the execution or
other enforcement of such Liens is effectively stayed and the claims secured
thereby are being actively contested in good faith and by appropriate
proceedings;
(f) easements,
encroachments, rights of way, leases, subleases, restrictions, minor defects or
irregularities in title and other similar Liens not interfering in any material
respect with the ordinary conduct of the business of Borrower or any
Subsidiary;
(g) any
interest or title of a lessor, sublessor under any lease (other than a Capital
Lease) permitted by this Agreement;
(h) Liens
arising from precautionary uniform commercial code financing statements filed
under any lease (other than a Capital Lease) permitted by this
Agreement;
(i) Liens
arising under the Loan Documents;
(j) Liens
on property of Borrower and its Subsidiaries securing the Senior Debt and
subject to the terms of the Intercreditor Agreement;
(k) Omitted;
(l) Omitted;
(m) the
Black Forest Security, subject to the terms of the Black Forest Subordination
Agreement; and
(n) the
replacement, extension or renewal of any Lien permitted by clause (c) above upon
or in the same property subject thereto arising out of the extension, renewal or
replacement of the Debt secured thereby (without increase in the amount
thereof).
7.3. Subsidiaries.
Not, and
not suffer or permit any other Loan Party Subsidiary to establish or acquire any
Subsidiary.
7.4. Restricted
Payments.
Not, and
not suffer or permit any other Loan Party Subsidiary to, (a) make any dividend
or other distribution to any of its equity holders, (b) purchase or redeem any
of its equity interests or any warrants, options or other rights in respect
thereof, (c) pay any management or consulting fees or similar fees to any of its
equity holders or any Affiliate thereof, (d) make any redemption, prepayment
(whether mandatory or optional), defeasance, repurchase or any other payment in
respect of any Debt that is subordinated to the Obligations, or (e) set aside
funds for any of the foregoing. Notwithstanding the foregoing, (i)
any Subsidiary of the Borrower may pay dividends or make other distributions to
Borrower or to a Wholly-Owned Domestic Subsidiary of Borrower; (ii) any Loan
Party may make distributions to Parent that are used by Parent to pay federal,
state and local income taxes then due and owing in respect of income from such
Loan Party or any Subsidiary of such Loan Party, franchise taxes and other
similar licensing expenses incurred in the ordinary course of business; provided that each
Loan Party’s aggregate contribution to taxes as a result of the filing of a
consolidated or combined return by Parent shall not be greater, nor the
aggregate receipt of tax benefits less, than they would have been had such Loan
Party not filed a consolidated or combined return with Parent, in each case, so
long as no Default or Event of Default is continuing or would arise as a
consequence thereof and (iii) Earth Leasing, Inc. may continue to pay
semi-annual dividends with respect to shares of its Series A Preferred Stock
(non-voting) that are outstanding on the date hereof and at a rate of not more
than $0.021852 per share; provided, that no
Event of Default is continuing or would occur as a result thereof.
7.5. Mergers; Consolidations;
Asset Sales.
(a) Not,
and not suffer or permit any other Loan Party Subsidiary to, be a party to any
merger or consolidation, except for any such merger or consolidation of any
Subsidiary of Borrower into Borrower (so long as the Borrower survives such
merger) or any Wholly-Owned Domestic Subsidiary of Borrower, as applicable (so
long such Wholly-Owned Domestic Subsidiary survives such merger).
(b) Not,
and not suffer or permit any other Loan Party Subsidiary to, sell, transfer,
dispose of, convey or lease any of its assets or equity interests, or sell or
assign with or without recourse any receivables, except for (i) sales of
inventory or used, worn-out or surplus equipment, all in the ordinary course of
business, and (ii) sales and dispositions of assets (excluding any equity
interests of Borrower or any Subsidiary of Borrower) for at least fair market
value (as determined by the Board of Directors of Borrower) so long as at least
75% of the purchase price therefor is in cash and the net book value of all
assets sold or otherwise disposed of in any Fiscal Year does not exceed
$500,000.
7.6. Modification
of Organizational Documents.
Not, and
not suffer or permit the charter, limited liability agreement, partnership
agreement, by-laws or other organizational documents of, Parent, Borrower or any
other Loan Party to be amended or modified in any way which could reasonably be
expected to materially adversely affect the interests of Agent or any
Lender.
7.7. Use of
Proceeds.
Use the
proceeds of the Loan solely to refinance the Existing Loan, to finance its
Capital Expenditures, to finance its working capital needs, to finance
investments in Subsidiaries of Parent that are permitted by Section 7.11 and to
pay any financing fees and expenses associated herewith, including those
described in the Fee Letter; and not use or permit any proceeds of the Loan to
be used, either directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of “purchasing or carrying” any Margin
Stock.
7.8. Transactions with Affiliates
and Former Affiliates.
(a) Not,
and not suffer or permit any other Loan Party Subsidiary to, enter into any
transaction with any Affiliate of the Borrower or of any such Subsidiary,
except:
(i) as
expressly permitted by this Agreement; or
(ii) in
the ordinary course of business and pursuant to the reasonable requirements of
the business of such Loan Party or such Subsidiary provided that, in the
case of this clause (ii), upon fair and reasonable terms no less favorable to
such Loan Party or such Subsidiary than would be obtained in a comparable arm’s
length transaction with a Person not an Affiliate of the Borrower or such
Subsidiary and which are disclosed in writing to the Agent.
(b) Effective
from and after the Closing Date, the Loan Parties shall cease and desist all
existing transactions with EBOF and ▇▇▇▇▇▇ (other than, in the case of PNG, the
transactions contemplated under the Share Exchange Agreement) and shall not
enter into any new transactions of any sort whatsoever with EBOF or ▇▇▇▇▇▇
subsequent to the Closing Date except upon first obtaining the prior written
consent of Agent and Lenders thereto.
7.9. Inconsistent
Agreements.
Not, and
not suffer or permit any other Loan Party (including Parent) to, enter into any
agreement containing any provision which would (a) be violated or breached by
any borrowing by Borrower hereunder or by the performance by Borrower or any
other Loan Party (including Parent) of any of its Obligations hereunder or under
any other Loan Document, (b) prohibit Borrower or any other Loan Party
(including Parent) from granting to Agent and Lenders a Lien on any of its
assets that constitute Collateral or (c) other than pursuant to any agreement in
effect on the Closing Date, or pursuant to the Senior Debt Documents, create or
permit to exist or become effective any encumbrance or restriction on the
ability of any other Loan Party Subsidiary to (i) pay dividends or make other
distributions to Borrower or any other Loan Party Subsidiary, or pay any Debt
owed to Borrower or any other Loan Party Subsidiary, (ii) make
loans or
advances to Borrower or any other Loan Party Subsidiary or (iii) transfer any of
its assets or properties to Borrower or any other Loan Party
Subsidiary.
7.10. Business
Activities.
Not, and
not suffer or permit any other Loan Party Subsidiary to, engage in any line of
business other than the businesses engaged in on the Closing Date and businesses
reasonably related thereto.
7.11. Investments.
Not, and
not suffer or permit any other Loan Party Subsidiary to, make or permit to exist
any Investment in any other Person, except the following:
(a) contributions
by Borrower to the common equity of any Wholly-Owned Domestic Subsidiary of
Borrower in existence on the Closing Date, or by any Subsidiary that is a Loan
Party to the capital of any other Wholly-Owned Domestic Subsidiary of Borrower
in existence on the Closing Date, so long as the recipient of any such common
equity contribution is the Borrower or at such time is a guarantor of the
Obligations and such guaranty or the Obligations is secured by a pledge of all
of its equity interests and substantially all of its real and personal property,
in each case in accordance with Section
6.8;
(b) Investments
constituting Debt permitted by Section
7.1(c);
(c) Contingent
Obligations constituting Debt permitted by Section 7.1 or Liens
permitted by Section
7.2;
(d) Cash
Equivalent Investments;
(e) loans
and advances to employees in the ordinary course of business not to exceed
$100,000 in aggregate principal amount at any time outstanding;
(f) Omitted;
and
(g) Investments
listed on Schedule
7.11 as of the Closing Date.
7.12. Omitted.
7.13. Fiscal
Year.
Not, and
not suffer or permit any other Loan Party Subsidiary or Parent to, change its
Fiscal Year.
7.14. Financial
Covenants.
7.14.1. Fixed Charge Coverage
Ratio.
Not and
not suffer or permit the Fixed Charge Coverage Ratio for any Computation Period
to be less than the applicable amount set forth below for such Computation
Period:
|
Computation Period
|
Ratio
|
|
Fiscal
Quarters Ending June 30, 2008
through
June 30, 2009
|
1.10:1
|
|
Fiscal
Quarters Ending September 30, 2009
and
thereafter
|
1.15:1
|
7.14.2. EBITDA.
Not and
not suffer or permit EBITDA for any Fiscal Quarter to be less than the
$1,050,000 for each Fiscal Quarter ending on or after December 31,
2008.
7.14.3. Capital
Expenditures.
Not make,
and not suffer or permit to be made, Capital Expenditures during each fiscal
period described below to exceed the amount specified below corresponding
thereto:
|
Fiscal Period
|
Capital Expenditures
|
|
Closing
Date through December 31, 2008
|
$750,000
|
|
January
1, 2009 through December 31, 2009
|
$1,000,000
|
|
January
1, 2010 through Maturity Date
|
$500,000
|
7.15. Deposit Accounts and
Securities Accounts.
Not, and
not suffer or permit any other Domestic Loan Party Subsidiary to, maintain or
establish any deposit account or securities account other than the deposit
accounts and securities accounts set forth on Schedule 7.15 without
prior written notice to Agent and unless Agent, Borrower or such other Loan
Party and the bank or securities intermediary at which such deposit account or
securities account, as applicable, is to be opened or maintained enter into a
Control Agreement regarding such deposit account or securities account, as
applicable, on terms satisfactory to Agent.
7.16. Sale-Leasebacks
. Not
and not suffer or permit any other Loan Party Subsidiary to, engage in a sale
leaseback, synthetic lease or similar transaction involving any of its
assets.
7.17. Hazardous
Substances
. Not,
and not suffer or permit any other Loan Party Subsidiary or Parent to, cause or
suffer to exist any release of any Hazardous Substances at, to or from any real
property owned, leased, subleased or otherwise operated or occupied by any Loan
Party Subsidiary or Parent that would violate any Environmental Law, form the
basis for any Environmental Claims or otherwise adversely affect the value or
marketability of any real property (whether or not owned by any Loan Party
Subsidiary or Parent), other than such violations, Environmental Claims and
effects that would not, in the aggregate, be reasonably be expected to have a
Material Adverse Effect. Notwithstanding the foregoing, under no
circumstances will any Domestic Loan Party Subsidiary cause or suffer to exist
any disposal of any Hazardous Substances at, on, under or in any real property
owned, leased, subleased, or otherwise operated or occupied by any Loan Party
Subsidiary or Parent.
|
Section
8.
|
Events of Default;
Remedies.
|
8.1. Events of
Default.
Each of
the following shall constitute an Event of Default under this
Agreement:
8.1.1. Non-Payment of
Credit.
Default,
in the payment when due of the principal of the Loan shall occur; or default,
and continuance thereof for 5 days, in the payment when due of any interest,
fee, or other amount payable by any Loan Party hereunder or under any other Loan
Document shall occur.
8.1.2. Default Under Other
Debt.
(a) Any
default shall occur under the terms applicable to any Debt (other than the
Obligations) of any Loan Party in an aggregate amount (for all such Debt so
affected and including undrawn committed or available amounts and amounts owing
to all creditors under any combined or syndicated credit arrangement) exceeding
$1,000,000 and such default shall result in the acceleration of the maturity of
such Debt or permit the holder or holders thereof, or any trustee or agent for
such holder or holders, to cause such Debt to become due and payable (or require
Borrower or any other Loan Party to purchase or redeem such Debt or post cash
collateral in respect thereof) prior to its expressed maturity.
8.1.3. Bankruptcy;
Insolvency.
Any Loan
Party becomes insolvent or generally fails to pay, or admits in writing its
inability or refusal to pay, debts as they become due; or any Loan Party applies
for, consents to, or acquiesces in the appointment of a trustee, receiver or
other custodian for such Loan Party or any property thereof, or makes a general
assignment for the benefit of creditors; or, in the absence of such application,
consent or acquiescence, a trustee, receiver or other custodian is appointed for
any Loan Party or for a substantial part of the property of any thereof and is
not discharged within 60 days; or any bankruptcy, reorganization, debt
arrangement, or other case or proceeding under any bankruptcy or insolvency law,
or any dissolution or liquidation proceeding, is commenced in respect of any
Loan Party, and if such case or proceeding is not commenced by such Loan Party,
it is consented to or acquiesced in by such Loan Party, or
remains
for 60 days undismissed; or any Loan Party takes any action to authorize, or in
furtherance of, any of the foregoing.
8.1.4. Non-Compliance with Loan
Documents.
(a) (a)
Failure by Borrower or any other Loan Party to comply with or to perform any
covenant set forth in Sections 6.1.1, 6.1.2, 6.1.3, 6.1.4, 6.1.5(a), 6.1.7, 6.3(b) and (c), 6.5, 6.7, and 7; or (b) failure by
Borrower or any other Loan Party to comply with or to perform any other
provision of this Agreement or any other Loan Document applicable to it (and not
constituting an Event of Default under any other provision of this Section 8) and
continuance of such failure described in this clause (b) for 30
days.
8.1.5. Representations;
Warranties.
Any
representation or warranty made by any Loan Party herein or any other Loan
Document is breached or is false or misleading in any material respect, or any
schedule, certificate, financial statement, report, notice or other writing
furnished by any Loan Party to Agent or any Lender in connection herewith is
false or misleading in any material respect on the date as of which the facts
therein set forth are stated or certified.
8.1.6. Pension
Plans.
(a) Institution
of any steps by any Person to terminate a Pension Plan if as a result of such
termination any Loan Party or any member of the Controlled Group could be
required to make a contribution to such Pension Plan, or could incur a liability
or obligation to such Pension Plan, in excess of $250,000; (b) a contribution
failure occurs with respect to any Pension Plan sufficient to give rise to a
Lien under Section 302(f) of ERISA; or (c) there shall occur any withdrawal or
partial withdrawal from a Multiemployer Pension Plan and the withdrawal
liability (without unaccrued interest) to Multiemployer Pension Plans as a
result of such withdrawal (including any outstanding withdrawal liability that
Borrower or any other Loan Party or any member of the Controlled Group have
incurred on the date of such withdrawal) exceeds $250,000.
8.1.7. Judgments.
(a) Final
judgments which exceed an aggregate of $250,000 shall be rendered against any
Loan Party and shall not have been paid, discharged or vacated or had execution
thereof stayed pending appeal within 30 days after entry or filing of such
judgments; or
(b) One
or more non-monetary judgments, orders or decrees shall be rendered against any
one or more of the Loan Parties or any of their respective Subsidiaries which
has had or would reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect, and there shall be any period of ten (10)
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.
8.1.8. Invalidity of Collateral
Documents.
Any
Collateral Document shall cease to be in full force and effect; or any Loan
Party or other grantor or pledgor (or any Person by, through or on behalf of any
Loan Party, grantor or pledgor) shall contest in any manner the validity,
binding nature or enforceability of any Collateral Document.
8.1.9. Invalidity of Intercreditor
Provisions.
Any
subordination provision in any document or instrument governing Debt that is
intended to be subordinated to the Obligations or any subordination provision in
any subordination agreement that relates to any such Debt, or any subordination
provision in any guaranty by any Loan Party of any such Debt, shall cease to be
in full force and effect, or any Person (including the holder of any applicable
Debt) shall contest in any manner the validity, binding nature or enforceability
of any such provision.
8.1.10. Change of
Control.
(a) Parent
shall cease to directly own and control 100% of each class of the outstanding
equity interests of Borrower, (b) Borrower shall cease to, directly or
indirectly, own and control 100% of each class of the outstanding equity
interests of each Subsidiary of the Borrower, or (c) a “Change of Control” or
other similar event shall occur, as defined in, or under, the Senior Debt
Documents or any other documentation evidencing or otherwise relating to any
Senior Debt.
8.1.11. Gas Supply and Hedge
Contracts.
Any Gas
Supply and Hedge Contract shall be terminated, cancelled or modified in a manner
that is materially adverse to Arizona LNG; provided, that
notwithstanding the foregoing, any Gas Supply and Hedge Contract may be replaced
by a similar agreement with terms no less favorable to Arizona LNG.
8.2. Remedies.
If any
Event of Default described in Section 8.1.3 shall
occur, the Loan and all other Obligations shall become immediately due and
payable, all without presentment, demand, protest or notice of any kind; and, if
any other Event of Default shall occur and be continuing, Agent (upon the
written request of Required Lenders) shall declare all or any part of the Loan
and other Obligations to be due and payable, whereupon the Loan and other
Obligations shall become immediately due and payable (in whole or in part, as
applicable), all without presentment, demand, protest or notice of any
kind. Agent shall promptly advise Borrower of any such declaration,
but failure to do so shall not impair the effect of such
declaration. Notwithstanding the foregoing, the effect as an Event of
Default of any event described in Section 8.1.1 may only be waived by the
written concurrence of each Lender, and the effect as an Event of Default of any
other event described in this Section 8 may be
waived by the written concurrence of Required Lenders. Any cash
collateral delivered hereunder shall be applied by Agent to any remaining
Obligations and any excess remaining after the Obligations shall have been Paid
in Full shall be delivered to Borrower or as a court of competent jurisdiction
may elect.
Section
9. Agent.
9.1. Appointment;
Authorization.
(a) Each
Lender hereby irrevocably appoints, designates and authorizes Agent to take such
action on its behalf under the provisions of this Agreement and each other Loan
Document and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary contained
elsewhere in this Agreement or in any other Loan Document, Agent shall not have
any duty or responsibility except those expressly set forth herein, nor shall
Agent have or be deemed to have any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against Agent.
9.2. Delegation of
Duties.
Agent may
execute any of its duties under this Agreement or any other Loan Document by or
through agents, employees or attorneys in fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. Agent
shall not be responsible for the negligence or misconduct of any agent or
attorney in fact that it selects with reasonable care.
9.3. Limited
Liability.
None of
Agent or any of its directors, officers, employees or agents shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except to the extent resulting from its own gross
negligence or willful misconduct as determined by a court of competent
jurisdiction), or (b) be responsible in any manner to any Lender for any
recital, statement, representation or warranty made by any Loan Party or
Affiliate of any Loan Party, or any officer thereof, contained in this Agreement
or in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document (or the creation, perfection or priority of any Lien or
security interest therein), or for any failure of any Loan Party or any other
party to any Loan Document to perform its Obligations hereunder or
thereunder. Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
Affiliate of any Loan Party.
9.4. Reliance.
Agent
shall be entitled to rely, and shall be fully protected in relying, upon any
writing, resolution, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, statement or other document believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel (including
counsel to any Loan Party), independent accountants and other
experts
selected
by Agent. Agent shall be fully justified in failing or refusing to
take any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of Required Lenders (or all Lenders if
expressly required hereunder) as it deems appropriate and, if it so requests,
confirmation from Lenders of their obligation to indemnify Agent against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of Required Lenders
(or all Lenders if expressly required hereunder) and such request and any action
taken or failure to act pursuant thereto shall be binding upon each
Lender.
9.5. Notice of
Default.
Agent
shall not be deemed to have knowledge or notice of the occurrence of any Event
of Default or Default except with respect to defaults in the payment of
principal, interest and fees required to be paid to Agent for the account of
Lenders, unless Agent shall have received written notice from a Lender or
Borrower referring to this Agreement, describing such Event of Default or
Default and stating that such notice is a “notice of default”. Agent
will notify Lenders of its receipt of any such notice or any such default in the
payment of principal, interest and fees required to be paid to Agent for the
account of Lenders. Agent shall take such action with respect to such
Event of Default or Default as may be requested by Required Lenders in
accordance with Section 8; provided
that unless and until Agent has received any such request, Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Event of Default or Default as it shall deem advisable or in the
best interest of Lenders.
9.6. Credit
Decision.
Each
Lender acknowledges that Agent has not made any representation or warranty to
it, and that no act by Agent hereafter taken, including any review of the
affairs of Borrower and the other Loan Parties, shall be deemed to constitute
any representation or warranty by Agent to any Lender. Each Lender
represents to Agent that it has, independently and without reliance upon Agent
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrower and the
other Loan Parties, and made its own decision to enter into this Agreement and
to extend credit to Borrower hereunder. Each Lender also represents
that it will, independently and without reliance upon Agent and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Agreement and the other Loan Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties. Except for notices, reports and
other documents expressly herein required to be furnished to Lenders by Agent,
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial or other condition or creditworthiness of any Loan Party
which may come into the possession of Agent.
9.7. Indemnification.
Whether
or not the transactions contemplated hereby are consummated, each Lender shall
indemnify upon demand Agent and its directors, officers, employees and agents
(to the extent not reimbursed by or on behalf of Borrower and without limiting
the obligation of Borrower to do so), based on such Lender’s Pro Rata Share,
from and against any and all actions, causes of action, suits, losses,
liabilities, damages and expenses, including Legal Costs, except to the extent
any thereof result from the applicable Person’s own gross negligence or willful
misconduct, as determined by a court of competent
jurisdiction. Without limitation of the foregoing, each Lender shall
reimburse Agent upon demand for its ratable share of any costs or out of pocket
expenses (including Legal Costs) incurred by 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 rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that Agent is not reimbursed for such expenses by or on behalf of
Borrower. The undertaking in this Section 9.7 shall survive repayment
of the Loan, cancellation of the Notes, any foreclosure under, or modification,
release or discharge of, any or all of the Collateral Documents, termination of
this Agreement and the resignation or replacement of Agent.
9.8. Agent
Individually.
Agent and
its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other business with
any Loan Party and any Affiliate of any Loan Party as though Agent were not
Agent hereunder and without notice to or consent of any Lender. Each
Lender acknowledges that, pursuant to such activities, Agent or its Affiliates
may receive information regarding Loan Parties or their Affiliates (including
information that may be subject to confidentiality obligations in favor of any
such Loan Party or such Affiliate) and acknowledge that Agent shall be under no
obligation to provide such information to them. With respect to their
portions of the Loan (if any), Agent and its Affiliates shall have the same
rights and powers under this Agreement as any other Lender and may exercise the
same as though Agent were not Agent, and the terms “Lender” and “Lenders”
include Agent and its Affiliates, to the extent applicable, in their individual
capacities.
9.9. Successor
Agent.
Agent may
resign as Agent at any time upon 30 days’ prior notice to Lenders. If
Agent resigns under this Agreement, Required Lenders shall, with (so long as no
Event of Default exists) the consent of Borrower (which shall not be
unreasonably withheld or delayed), appoint from among Lenders a successor agent
for Lenders. If no successor agent is appointed prior to the
effective date of the resignation of Agent, Agent may appoint, on behalf after
consulting with Lenders and (so long as no Event of Default exists) Borrower, a
successor agent from among Lenders. Upon the acceptance of its
appointment as successor agent hereunder, such successor agent shall succeed to
all the rights, powers and duties of the retiring Agent and the term “Agent”
shall mean such successor agent, and the retiring Agent’s appointment, powers
and duties as Agent shall be terminated. After any retiring Agent’s
resignation hereunder as Agent, the
provisions
of this Section
9 and Sections
10.4 and 10.5 shall continue
to inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement. If no successor agent has
accepted appointment as Agent by the date which is 30 days following a retiring
Agent’s notice of resignation, the retiring Agent’s resignation shall
nevertheless thereupon become effective and Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as Required Lenders appoint a
successor agent as provided for above.
9.10. Collateral
Matters.
Lenders
irrevocably authorize Agent, at its option and in its discretion, (a) to release
any Lien granted to or held by Agent under any Collateral Document (i) when all
Obligations have been Paid in Full; (ii) constituting property sold or to be
sold or disposed of as part of or in connection with any sale or other
disposition permitted hereunder (it being agreed and understood that Agent may
conclusively rely without further inquiry on a certificate of an officer of
Borrower as to the sale or other disposition of property being made in
compliance with this Agreement); or (iii) subject to Section 10.1, if
approved, authorized or ratified in writing by Required Lenders; or (b) to
subordinate its interest in any Collateral to any holder of a Lien on such
Collateral which is permitted by clause (d)(i) or (d)(iii) of Section 7.2 (it being
understood that Agent may conclusively rely on a certificate from Borrower in
determining whether the Debt secured by any such Lien is permitted by Section
7.1(b)). Upon request by Agent at any time, Lenders will confirm in
writing Agent’s authority to release, or subordinate its interest in, particular
types or items of Collateral pursuant to this Section
9.10.
|
Section
10.
|
Miscellaneous.
|
10.1. Waiver;
Amendments.
No delay
on the part of Agent or any Lender in the exercise of any right, power or remedy
shall operate as a waiver thereof, nor shall any single or partial exercise by
any of them of any right, power or remedy preclude other or further exercise
thereof, or the exercise of any other right, power or remedy. No
amendment, modification or waiver of, or consent with respect to, any provision
of this Agreement, the Notes or any of the other Loan Documents (or any
subordination and intercreditor agreement or other subordination provisions
relating to any other Debt) shall in any event be effective unless the same
shall be in writing and approved by Lenders having aggregate Pro Rata Shares of
not less than the aggregate Pro Rata Shares expressly designated herein with
respect thereto or, in the absence of such designation as to any provision of
this Agreement, by Required Lenders, and then any such amendment, modification,
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. No amendment, modification, waiver
or consent shall increase any Commitment, extend the date scheduled for payment
of any principal of (except as set forth below) or interest on the Loan or any
fees or other amounts payable hereunder or under the other Loan Documents or
reduce the principal amount of the Loan, the amount or rate of interest thereon
(provided, that Required Lenders may rescind an imposition of default interest
pursuant to Section
2.4.1) or any fees or other amounts payable hereunder or under the other
Loan Documents, without, in each case, the consent of each Lender directly
affected thereby. No amendment, modification, waiver or consent shall
release any party from its guaranty under the Guarantee and
Collateral
Agreement
or all or any substantial part of the Collateral granted under the Collateral
Documents, change the definition of Required Lenders, change any provision of
this Section
10.1, change the provisions of Section 2.8.2 or
reduce the aggregate Pro Rata Share required to effect any amendment,
modification, waiver or consent, without, in each case, the consent of all
Lenders. No provision of Section 9 or other provision of this
Agreement affecting Agent in its capacity as such shall be amended, modified or
waived without the consent of Agent.
10.2. Notices.
All
notices hereunder shall be in writing (including facsimile transmission) and
shall be sent to the applicable party at its address shown on Annex II or at such
other address as such party may, by written notice received by the other
parties, have designated as its address for such purpose. Notices
sent by facsimile transmission shall be deemed to have been given when sent;
notices sent by mail shall be deemed to have been given three Business Days
after the date when sent by registered or certified mail, postage prepaid; and
notices sent by hand delivery or overnight courier service shall be deemed to
have been given when received. Borrower and Lenders each hereby
acknowledge that, from time to time, Agent may deliver information and notices
to Lenders using the internet service “Intralinks” or any similar
service. Each of Borrower and each Lender hereby agree that Agent
may, in its discretion, utilize Intralinks or any similar service for such
purpose.
10.3. Computations.
Unless
otherwise specifically provided herein, any accounting term used in this
Agreement (including in Section 7.14 or any
related definition) shall have the meaning customarily given such term in
accordance with GAAP, and all financial computations (including pursuant to
Section 7.14
and the related definitions, and with respect to the character or amount of any
asset or liability or item of income or expense, or any consolidation or other
accounting computation) hereunder shall be computed in accordance with GAAP
consistently applied; provided that if Borrower notifies Agent that Borrower
wishes to amend any covenant in Section 7.14 (or any
related definition) to eliminate or to take into account the effect of any
change after the Closing Date in GAAP on the operation of such covenant (or if
Agent notifies Borrower that Required Lenders wish to amend Section 7.14 (or any
related definition) for such purpose), then Borrower’s compliance with such
covenant shall be determined on the basis of GAAP in effect immediately before
the relevant change in GAAP became effective, until either such notice is
withdrawn or such covenant (or related definition) is amended in a manner
satisfactory to Borrower and Required Lenders. The explicit
qualification of terms or computations by the phrase “in accordance with GAAP”
shall in no way be construed to limit the foregoing.
10.4. Costs;
Expenses.
Borrower
agrees to pay on demand all reasonable out-of-pocket costs and expenses of Agent
(including Legal Costs) in connection with the preparation, execution,
syndication, delivery and administration (including perfection and protection of
Collateral) of this Agreement, the other Loan Documents and all other documents
provided for herein or delivered or to be delivered hereunder or in connection
herewith (including any proposed or actual amendment,
supplement
or waiver to any Loan Document), and all reasonable out-of-pocket costs and
expenses (including Legal Costs) incurred by Agent and each Lender after an
Event of Default in connection with the collection of the Obligations and
enforcement of this Agreement, the other Loan Documents or any such other
documents; provided, however, that notwithstanding the foregoing, the Borrower
shall not be required to reimburse the Agent or Lenders for expenses incurred on
or prior to the Closing Date by the Agent and Lenders in connection with the
preparation, execution and delivery of the Loan Documents in an aggregate amount
in excess of $100,000. In addition, Borrower agrees to pay, and to
save Agent and Lenders harmless from all liability for, any fees of Borrower’s
auditors in connection with any reasonable exercise by Agent and Lenders of
their rights pursuant to Section
6.2. All Obligations provided for in this Section 10.4 shall
survive repayment of the Loan, cancellation of the Notes and termination of this
Agreement.
10.5. Indemnification by
Borrower.
In
consideration of the execution and delivery of this Agreement by Agent and
Lenders and the agreement to extend the Commitments provided hereunder, Borrower
hereby agrees to indemnify, exonerate and hold Agent, each Lender and each of
the officers, directors, employees, Affiliates and agents of Agent and each
Lender (each a “Lender
Party”) free and harmless from and against any and all actions, causes of
action, suits, losses, liabilities (including, without limitation, strict
liabilities), damages, fines, penalties and expenses, including Legal Costs
(collectively, the “Indemnified
Liabilities”), incurred by Lender Parties or any of them as a result of,
or arising out of, or relating to (a) any repayment of Debt, tender offer,
merger, purchase of equity interests, purchase of assets or other similar or
dissimilar transaction financed or proposed to be financed in whole or in part,
directly or indirectly, with the proceeds of the Loan, (b) the generation, use,
handling, recycling, reclamation, release, emission, discharge, transportation,
storage, treatment or disposal of any Hazardous Substance at any property owned
or leased by Borrower or any other Loan Party, (c) any violation of or liability
under any Environmental Laws or any Environmental Claim with respect to
conditions at any property owned or leased by any Loan Party or the operations
conducted thereon, (d) the investigation, cleanup or remediation of offsite
locations at which any Loan Party or their respective predecessors are alleged
to have directly or indirectly released or disposed of Hazardous Substances and
any related Environmental Claims or (e) the execution, delivery, performance or
enforcement of this Agreement or any other Loan Document by any Lender Party,
except to the extent any such Indemnified Liabilities result from the applicable
Lender Party’s own gross negligence or willful misconduct as determined by a
court of competent jurisdiction. If and to the extent that the
foregoing undertaking may be unenforceable for any reason, Borrower hereby
agrees to make the maximum contribution to the payment and satisfaction of each
of the Indemnified Liabilities which is permissible under applicable
law. All Obligations provided for in this Section 10.5 shall
survive repayment of the Loan, cancellation of the Notes, any foreclosure under,
or any modification, release or discharge of, any or all of the Collateral
Documents and termination of this Agreement.
10.6. Marshaling; Payments Set
Aside.
Neither
Agent nor any Lender shall be under any obligation to marshal any assets in
favor of Borrower or any other Person or against or in payment of any or all of
the Obligations.
To the
extent that Borrower makes a payment or payments to Agent or any Lender, or
Agent or any Lender enforces its Liens or exercises its rights of set-off, and
such payment or payments or the proceeds of such enforcement or set-off or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required (including pursuant to any settlement
entered into by Agent or any Lender in its discretion) to be repaid to a
trustee, receiver or any other party in connection with any bankruptcy,
insolvency or similar proceeding, or otherwise, then (a) to the extent of such
recovery, the obligation hereunder or part thereof originally intended to be
satisfied 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 and (b)
each Lender severally agrees to pay to Agent upon demand its ratable share of
the total amount so recovered from or repaid by Agent to the extent paid to such
Lender.
10.7. Nonliability of
Lenders.
The
relationship between Borrower on the one hand and Lenders and Agent on the other
hand shall be solely that of borrower and lender. Neither Agent nor
any Lender shall have any fiduciary responsibility to
Borrower. Neither Agent nor any Lender undertakes any responsibility
to Borrower to review or inform Borrower of any matter in connection with any
phase of Borrower’s business or operations. Execution of this
Agreement by Borrower constitutes a full, complete and irrevocable release of
any and all claims which Borrower may have at law or in equity in respect of all
prior discussions and understandings, oral or written, relating to the subject
matter of this Agreement and the other Loan Documents. Neither Agent
nor any Lender shall have any liability with respect to, and Borrower hereby
waives, releases and agrees not to ▇▇▇ for, any special, indirect, punitive or
consequential damages or liabilities.
10.8. Assignments;
Participations.
10.8.1. Assignments.
(a) Any
Lender may at any time assign to one or more Persons (any such Person, an “Assignee”) all or any
portion of such Lender’s share of the Loan, with the prior written consent of
Agent and, so long as no Event of Default exists, Borrower (which consents shall
not be unreasonably withheld or delayed and shall not be required for an
assignment by a Lender to a Lender or an Affiliate of a Lender or an Approved
Fund of a Lender). Except as Agent may otherwise agree, any such
assignment (other than any assignment by a Lender to a Lender or an Affiliate or
Approved Fund of a Lender) shall be in a minimum aggregate amount equal to
$2,500,000 or, if less, the entire principal amount of the Loan being
assigned. Borrower and Agent shall be entitled to continue to deal
solely and directly with such Lender in connection with the interests so
assigned to an Assignee until Agent shall have received and accepted an
effective Assignment Agreement executed, delivered and fully completed by the
applicable parties thereto and a processing fee of $3,500 to be paid by the
Lender to whom such interest is assigned; provided, that no such fee shall be
payable in connection with any assignment by a Lender to a Lender or an
Affiliate or Approved Fund of a Lender. Any attempted assignment not
made in accordance with this Section 10.8.1 shall
be treated as the sale of a participation under Section
10.8.2. Borrower shall be deemed to have granted its consent
to any assignment requiring its consent hereunder unless Borrower has expressly
objected to such assignment within three Business Days after notice
thereof.
(b) From
and after the date on which the conditions described above have been met, (i)
such Assignee shall be deemed automatically to have become a party hereto and,
to the extent that rights and obligations hereunder have been assigned to such
Assignee pursuant to such Assignment Agreement, shall have the rights and
obligations of a Lender hereunder and (ii) the assigning Lender, to the extent
that rights and obligations hereunder have been assigned by it pursuant to such
Assignment Agreement, shall be released from its rights (other than its
indemnification rights) and obligations hereunder. Upon the request
of the Assignee (and, as applicable, the assigning Lender) pursuant to an
effective Assignment Agreement, Borrower shall execute and deliver to Agent for
delivery to the Assignee (and, as applicable, the assigning Lender) a Note in
the principal amount of the Assignee’s Pro Rata Share of the
Loan. Each such Note shall be dated the effective date of such
assignment. Upon receipt by the assigning Lender of such Note, the
assigning Lender shall return to Borrower any prior Note held by
it.
(c) Agent,
acting solely for this purpose as an agent of Borrower, shall maintain at one of
its offices in the United States a copy of each Assignment Agreement delivered
to it and a register for the recordation of the names and addresses of each
Lender, and principal amount of the Loan owing to, such Lender pursuant to the
terms hereof. The entries in such register shall be conclusive, and
Borrower, Agent and Lenders may treat each Person whose name is recorded therein
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. Such register
shall be available for inspection by Borrower and any Lender, at any reasonable
time upon reasonable prior notice to Agent.
(d) Notwithstanding
the foregoing provisions of this Section 10.8.1 or any
other provision of this Agreement, any Lender may at any time assign all or any
portion of its Pro Rata Share of the Loan and its Note (i) as collateral
security to a Federal Reserve Bank or, as applicable, to such Lender’s trustee
for the benefit of its investors (but no such assignment shall release any
Lender from any of its obligations hereunder) and (ii) to (w) an Affiliate of
such Lender which is at least 50% owned (directly or indirectly) by such Lender
or by its direct or indirect parent company, (x) its direct or indirect parent
company, (y) to one or more other Lenders or (z) to a Approved
Fund.
10.8.2. Participations.
Any
Lender may at any time with, so long as no Event of Default is continuing and
such Lender intends to sell more than 50% of its Pro Rata Share (as of such
date) of the Loan, Commitments or other interests hereunder, the consent of the
Borrower sell to one or more Persons participating interests in its Pro Rata
Share of the Loan, Commitments or other interests hereunder (any such Person, a
“Participant”). In
the event of a sale by a Lender of a participating interest to a Participant,
(a) such Lender’s obligations hereunder shall remain unchanged for all purposes,
(b) Borrower and Agent shall continue to deal solely and directly with such
Lender in connection with such Lender’s rights and obligations hereunder and (c)
all amounts payable by Borrower shall be determined as if such Lender had not
sold such participation and shall be paid directly to such
Lender. Borrower agrees that if amounts outstanding under this
Agreement are due and payable (as a result of acceleration or otherwise), each
Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly
to
it as a
Lender under this Agreement; provided that such right of set-off shall be
subject to the obligation of each Participant to share with Lenders, and Lenders
agree to share with each Participant, as provided in Section
2.8.5. Borrower also agrees that each Participant shall be
entitled to the benefits of Section 3 and Section 10.5 as if it
were a Lender.
10.9. Confidentiality.
Agent and
each Lender agree to use commercially reasonable efforts (equivalent to the
efforts Agent or such Lender applies to maintain the confidentiality of its own
confidential information) to maintain as confidential all information provided
to them by any Loan Party and designated as confidential, except that Agent and
each Lender may disclose such information (a) to Persons employed or engaged by
Agent or such Lender or any of their Affiliates (including collateral managers
of Lenders) in evaluating, approving, structuring or administering the Loan and
the Commitments; (b) to any assignee or participant or potential assignee or
participant that has agreed to comply with the covenant contained in this
Section 10.9 (and any such assignee or participant or potential assignee or
participant may disclose such information to Persons employed or engaged by them
as described in clause (a) above); (c) as required or requested by any federal
or state regulatory authority or examiner, or any insurance industry
association, or as reasonably believed by Agent or such Lender to be compelled
by any court decree, subpoena or legal or administrative order or process; (d)
as, on the advice of Agent’s or such Lender’s counsel, is required by law; (e)
in connection with the exercise of any right or remedy under the Loan Documents
or in connection with any litigation to which Agent or such Lender is a party;
(f) to any nationally recognized rating agency or investor of a Lender that
requires access to information about a Lender’s investment portfolio in
connection with ratings issued or investment decisions with respect to such
Lender; (g) that ceases to be confidential through no fault of Agent or any
Lender; (h) to a Person that is an investor or prospective investor in a
Securitization that agrees that its access to information regarding Borrower and
the Loan and Commitments is solely for purposes of evaluating an investment in
such Securitization and who agrees to treat such information as confidential;
(i) to a Person that is a trustee, collateral manager, servicer, noteholder or
secured party in a Securitization in connection with the administration,
servicing and reporting on the assets serving as collateral for such
Securitization; or (j) to a Person that is an investor or prospective investor
in Fourth Third or any of its Affiliates. For purposes of this
Section, “Securitization” means
a public or private offering by a Lender or any of its Affiliates or their
respective successors and assigns, of securities which represent an interest in,
or which are collateralized, in whole or in part, by the Loan or the
Commitments. Notwithstanding the foregoing, Borrower consents to the
publication by Agent or any Lender of a tombstone or similar advertising
material relating to the financing transactions contemplated by this Agreement,
and Agent reserves the right to provide to industry trade organizations
information necessary and customary for inclusion in league table
measurements.
10.10. Captions.
Captions
used in this Agreement are for convenience only and shall not affect the
construction of this Agreement.
10.11. Nature
of Remedies.
All
Obligations of Borrower and rights of Agent and Lenders expressed herein or in
any other Loan Document shall be in addition to and not in limitation of those
provided by applicable law. No failure to exercise and no delay in
exercising, on the part of Agent or any Lender, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege.
10.12. Counterparts.
This
Agreement may be executed in any number of counterparts and by the different
parties hereto on separate counterparts and each such counterpart shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same Agreement. Receipt by telecopy of any executed
signature page to this Agreement or any other Loan Document shall constitute
effective delivery of such signature page.
10.13. Severability.
The
illegality or unenforceability of any provision of this Agreement or any
instrument or agreement required hereunder shall not in any way affect or impair
the legality or enforceability of the remaining provisions of this Agreement or
any instrument or agreement required hereunder.
10.14. Entire
Agreement.
Subject
to the succeeding paragraph, this Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the parties
hereto and supersedes all prior or contemporaneous agreements and understandings
of such Persons, verbal or written, relating to the subject matter hereof and
thereof (except as relates to the fees described in Section 2.5.1) and
any prior arrangements made with respect to the payment by Borrower of (or any
indemnification for) any fees, costs or expenses payable to or incurred (or to
be incurred) by or on behalf of Agent or Lenders
From and
after the Closing Date: (a) all terms and conditions of the Original Credit
Agreement and the Original Loan Documents, as amended by this Agreement and the
other Loan Documents being executed and delivered on the Closing Date, shall be
and remain in full force and effect, as so amended, and shall constitute the
legal, valid, binding and enforceable obligations of the Borrower and the other
Loan Parties party thereto to Agent and Lenders; (b) the terms and conditions of
the Original Credit Agreement shall be amended as set forth herein and, as so
amended, shall be restated in their entirety; (c) this Agreement shall not in
any way release or impair the rights, duties, Obligations or Liens created
pursuant to the Original Credit Agreement or any other Original Loan Document or
affect the relative priorities thereof, in each case to the extent in force and
effect thereunder as of the Closing Date, except as modified hereby or by
documents, instruments and agreements executed and delivered in connection
herewith, and all of such rights, duties, Obligations and Liens (as so modified)
are assumed, ratified and affirmed by the Borrower and the other Loan Parties;
(d) all indemnification obligations of Borrower and the other Loan Parties under
the Original Credit Agreement and the
Original
Loan Documents shall survive the execution and delivery of this Agreement and
shall continue in full force and effect for the benefit of Agent and Lenders and
any other Person indemnified under the Original Credit Agreement or any other
Existing Loan Document at any time prior to the Closing Date but not to the
extent that any such indemnification obligations shall relate to any Indemnified
Liabilities resulting from any action or inaction by, or otherwise shall have
been caused by, any of Old Earth, EBOF or ▇▇▇▇▇▇; (e) the amendment and
restatement contained herein shall not, in any manner, be construed to
constitute payment of, or impair, limit, cancel or extinguish, or constitute a
novation in respect of, the Obligations evidenced by or arising under the
Original Credit Agreement and the other Original Loan Documents (as amended by
this Agreement and the other Loan Documents being executed on the Closing Date)
and the Liens and security interests securing such Obligations granted by
Borrower and the other Loan Parties in the Original Credit Agreement and the
other Loan Documents (as amended by this Agreement and the other Loan Documents
being executed on the Closing Date), which shall not in any manner be impaired,
limited, terminated, waived or released; (f) the execution, delivery and
effectiveness of this Agreement shall not operate as a waiver of any right,
power or remedy of Agent and Lenders under the Original Credit Agreement or any
other Original Loan Document, nor constitute a waiver of any covenant, agreement
or obligation under the Original Credit Agreement or any other Original Loan
Document, except to the extent that any such covenant, agreement or obligation
is no longer set forth herein or is modified hereby; and (g) any and all
references in the Original Loan Documents to the Original Credit Agreement
shall, without further action of the parties, be deemed a reference to the
Original Credit Agreement, as amended and restated by this Agreement, and as
this Agreement shall be further amended or amended and restated from time to
time hereafter.
For avoidance of doubt, under the terms
and conditions of (i) the Original Credit Agreement and the Original Loan
Documents, as amended by this Agreement and the other Loan Documents being
executed and delivered on the Closing Date, or (ii) any other agreement,
instrument, court order or judgment, or other writing heretofore executed and
delivered to any Lender Party and relating to any of the Obligations, (A) no
Loan Party shall be deemed to guaranty or otherwise be responsible or liable in
any respect for, and no asset of any Loan Party or Lien with respect thereto or
other Collateral shall be deemed to secure, support or otherwise constitute
collateral or security for, any liability, indebtedness or other obligation of
any of Old Earth, EBOF or ▇▇▇▇▇▇ with respect to the Obligations and (B) no
Default or Event of Default shall be deemed to occur or exist as a result of any
action or inaction by, or to be otherwise caused by any matter of circumstance
to the extent relating to, any of Old Earth, EBOF or ▇▇▇▇▇▇ in their capacities
as “Loan Parties” under the Original Credit Agreement or any other Original Loan
Documents.
10.15. Successors;
Assigns.
This
Agreement shall be binding upon Borrower, Lenders and Agent and their respective
successors and assigns, and shall inure to the benefit of Borrower, Lenders and
Agent and the successors and assigns of Lenders and Agent. No other
Person shall be a direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with, this Agreement or any of
the other Loan Documents. Borrower may not assign or transfer any of
its rights or Obligations under this Agreement without the prior written consent
of Agent and each Lender.
10.16. Governing
Law.
THIS
AGREEMENT AND EACH NOTE SHALL BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW).
10.17. Forum Selection; Consent to
Jurisdiction.
ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT, SHALL BE BROUGHT AND MAINTAINED
EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED THAT ANY SUIT
SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT
AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. EACH LOAN PARTY HEREBY EXPRESSLY AND
IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORKAND OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW
YORK FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE. EACH
LOAN PARTY FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED
MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW
YORK. EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
10.18. Waiver of Jury
Trial.
EACH LOAN
PARTY, AGENT AND EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY
NOTE, ANY OTHER LOAN DOCUMENT AND ANY AMENDMENT, INSTRUMENT, DOCUMENT OR
AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION
HEREWITH OR THEREWITH OR ARISING FROM ANY LENDING RELATIONSHIP EXISTING IN
CONNECTION WITH ANY OF THE FOREGOING, AND AGREES THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
10.19. Collateral
Agent.
Each
Lender hereby appoints Fourth Third LLC as its collateral agent under the
Guarantee and Collateral Agreement and agrees that in so acting Fourth Third LLC
will have all
the
rights, protections, exculpations, indemnities and other benefits provided to
Fourth Third LLC under Section 9 hereof, and
authorizes and directs Fourth Third LLC to take or refrain from taking any and
all action that it deems necessary or advisable in fulfilling its role as
Collateral Agent under the Guarantee and Collateral Agreement.
[signature
pages follow]
The
parties hereto have caused this Agreement to be duly executed and delivered by
their duly authorized officers as of the date first set forth
above.
PNG
VENTURES, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: Chief
Executive Officer
NEW EARTH
LNG, LLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: President
APPLIED
LNG TECHNOLOGIES USA, L.L.C.
By: NEW
EARTH LNG, LLC,
its
sole member
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: President
FLEET
STAR, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, III
Name: ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇, III
Title: Chief
Executive Officer
EARTH
LEASING, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, III
Name: ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇, III
Title: Chief
Executive Officer
ARIZONA
LNG, L.L.C.
By: NEW
EARTH LNG, LLC,
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: President
FOURTH
THIRD LLC,
as Agent
and a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Title:
Authorized Signatory
ANNEX
I
Commitments and Pro Rata
Shares
|
Lender
|
Loan Commitment
|
Pro Rata Share
|
|
Fourth
Third LLC
|
$34,000,000
|
100%
|
I-1
Annex
II
Addresses
Loan
Parties
Address
for Notices:
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▇▇▇▇▇▇,
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Attention: ▇▇▇▇▇▇
▇. ▇▇▇▇▇
Telephone: (214)
[389-9800]
Telecopy: (214)
[389-9805]
FOURTH
THIRD LLC,
as Agent
and a Lender
Address
for Notices:
Fourth
Third Capital LLC
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▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Chief
Financial Officer
Telephone: (▇▇▇)
▇▇▇-▇▇▇▇
Telecopier: (▇▇▇)
▇▇▇-▇▇▇▇
copies
to
King
& Spalding LLP
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▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇)
▇▇▇-▇▇▇▇
Telecopier: (▇▇▇)
▇▇▇-▇▇▇▇
Address
for Payments:
Bank: [REDACTED]
ABA: [REDACTED]
FFC: [REDACTED]
A/C: [REDACTED]
Address: ▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Exhibit
A
Form of Assignment
Agreement
This
Assignment Agreement (this “Assignment
Agreement”) is entered into as of __________ by and between the Assignor
named on the signature page hereto (“Assignor”) and the
Assignee named on the signature page hereto (“Assignee”). Reference
is made to the Amended and Restated Credit Agreement dated as of June __,
2008 (as amended, supplemented, restated or otherwise modified from
time to time, the “Credit Agreement”)
among NEW EARTH LNG, LLC (“Borrower”), the other
Loan Parties named therein, the financial institutions party thereto from time
to time, as Lenders, and FOURTH THIRD LLC, as Agent. Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
them in the Credit Agreement.
Assignor
and Assignee agree as follows:
1. Assignor
hereby sells and assigns to Assignee, and Assignee hereby purchases and assumes
from Assignor the interests set forth on the schedule attached hereto, in and to
Assignor’s rights and obligations under the Credit Agreement and the other Loan
Documents as of the Effective Date (as defined below). Such purchase
and sale is made without recourse, representation or warranty except as
expressly set forth herein.
2. Assignor
(i) represents that as of the Effective Date, that it is the legal and
beneficial owner of the interests assigned hereunder free and clear of any
adverse claim, (ii) makes no other representation or warranty and assumes no
responsibility with respect to any statement, warranties or representations made
in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement, any Loan Documents or any other instrument or document furnished
pursuant thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Loan Party or any
other Person or the performance or observance by any Loan Party of its
Obligations under the Credit Agreement or the Loan Documents or any other
instrument or document furnished pursuant thereto.
3. Assignee
(i) represents and warrants that it is legally authorized to enter into this
Assignment Agreement; (ii) confirms that it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered pursuant thereto and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment Agreement; (iii) agrees that it will, independently and without
reliance upon Agent, Assignor 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 the Credit Agreement;
(iv) appoints and authorizes Agent to take such action as agent on its behalf
and to exercise such powers under the Credit Agreement as are delegated to Agent
by the terms thereof, together with such powers as are reasonably incidental
thereto; (v) agrees that it will perform in accordance with their terms all
obligations which by the terms of the Credit Agreement are required to be
performed by it as a Lender; (vi) represents that on the date of this Assignment
Agreement it is not presently aware of any facts that would cause it to make a
claim under the Credit Agreement; and (vii) if organized under the
laws of a
jurisdiction outside the United States, attaches the forms prescribed by the
Internal Revenue Service of the United States, which have been duly executed,
certifying as to Assignee’s exemption from United States withholding taxes with
respect to all payments to be made to Assignee under the Agreement or such other
documents as are necessary to indicate that all such payments are subject to
such tax at a rate reduced by an applicable tax treaty.
4. The
effective date for this Assignment Agreement shall be as set forth on the
schedule attached hereto (the “Effective
Date”). Following the execution of this Assignment Agreement,
it will be delivered to Agent for acceptance and recording by Agent pursuant to
the Credit Agreement.
5. Upon
such acceptance and recording, from and after the Effective Date, (i) Assignee
shall be a party to the Credit Agreement and, to the extent provided in this
Assignment Agreement, have the rights and obligations of a Lender thereunder and
(ii) Assignor shall, to the extent provided in this Assignment Agreement,
relinquish its rights (other than indemnification rights) and be released from
its obligations under the Credit Agreement.
6. Upon
such acceptance and recording, from and after the Effective Date, Agent shall
make all payments in respect of the interest assigned hereby (including payments
of principal, interest, fees and other amounts) to Assignee. Assignor
and Assignee shall make all appropriate adjustments in payments for periods
prior to the Effective Date with respect to the making of this assignment
directly between themselves.
7. THIS
ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES.
8. This
Assignment may be executed in any number of counterparts and by the different
parties hereto on separate counterparts and each such counterpart shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same Assignment. Receipt by telecopy of any executed
signature page to this Assignment shall constitute effective delivery of such
signature page.
The
parties hereto have caused this Agreement to be executed and delivered as of the
date first written above.
ASSIGNOR:
___________________________
By:
Title:
ASSIGNEE:
___________________________
By:
Title:
[Consented
to:
FOURTH
THIRD LLC,
as
Agent
By:
Title: ]
[___________________________
By:
Title: ]
Schedule to Assignment
Agreement
Assignor: ____________________
Assignee: ____________________
Effective
Date: ____________________
Amended
and Restated Credit Agreement dated as of June __, 2008 among NEW EARTH LNG,
LLC, as Borrower, the other Loan Parties named therein, the financial
institutions party thereto from time to time, as Lenders, and FOURTH THIRD LLC,
as Agent
Interests
Assigned:
|
Loan
|
Loan
|
|
Assignor
Amounts
|
$
|
|
Amounts
Assigned
|
$
|
|
Assignee
Amounts (post-assignment)
|
$
|
Assignee
Information:
|
Address
for Notices:
___________________________
___________________________
Attention: _______________
Telephone: _______________
Telecopy: _______________
|
Address
for Payments:
Bank: _____________________
ABA
#: _____________________
Account
#: _____________________
Reference: _____________________
|
Exhibit
B
Form of Compliance
Certificate
Please
refer to the Amended and Restated Credit Agreement dated as of June __,
2008 (as amended, supplemented, restated or otherwise modified from
time to time, the “Credit Agreement”)
among the undersigned (“Borrower”), the other
Loan Parties named therein, the financial institutions party thereto and FOURTH
THIRD LLC, as Agent. This certificate (this “Certificate”), together
with supporting calculations attached hereto, is delivered to Agent and Lenders
pursuant to the terms of the Credit Agreement. Terms used but not
otherwise defined herein are used herein as defined in the Credit
Agreement.
[Enclosed
herewith is a copy of the [annual audited/monthly] report of Borrower as at
________________ (the “Computation Date”),
which report fairly presents in all material respects the financial condition
and results of operations [(subject to the absence of footnotes and to normal
year-end adjustments)] of Borrower as of the Computation Date and has been
prepared in accordance with GAAP consistently applied.]
Borrower
hereby certifies and warrants that the computations set forth on the schedule
attached hereto correspond to the ratios and/or financial restrictions contained
in the Credit Agreement and such computations are true and correct as at the
[Computation
Date].
Borrower
further certifies that no Event of Default or Default has occurred and is
continuing.
Borrower
has caused this Certificate to be executed and delivered by its officer
thereunto duly authorized on _____________.
NEW EARTH
LNG, LLC
By:
Title:
Schedule
to Compliance Certificate
Dated as
of _________________
A. Section
7.14.1 – Minimum Fixed Charge Coverage Ratio
1. Consolidated
Net
Income $________
2. Plus: Interest
Expense $________
income tax
expense $________
depreciation
$________
amortization
$________
management
fees $________
3. Total
(EBITDA)
$________
4. Income
taxes paid/tax
distributions $________
5. Capital
Expenditures $________
6. Sum
of (4) and
(5) $________
7. Remainder
of (3) minus
(6) $________
8. Interest
Expense accrued and payable in
cash $________
9. Required
payments of principal of
Debt (including The
Loan) $________
10. Management
Fees
$________
11. Sum
of (8), (9) and
(10) $________
12. Ratio
of (7) to
(11) ____
to 1
13. Minimum
Required ____
to 1
B. Section
7.14.2-Minimum EBITDA
1. EBITDA $________
(from Item A(3) above)
2. Minimum
required $________
Exhibit
C
Form of
Note
$__________________ New
York, New York
The
undersigned (“Borrower”), for value
received, promises to pay to the order of _____________ (“Lender”) at the
principal office of FOURTH THIRD LLC (the “Agent”) in New York
City, New York the aggregate unpaid amount of the Loan made to
Borrower by Lender pursuant to the Credit Agreement referred to below, such
principal amount to be payable on the dates set forth in the Credit
Agreement.
Borrower
further promises to pay interest on the unpaid principal amount of the Loan from
the date of such Loan until such Loan is Paid in Full, payable at the rate(s)
and at the time(s) set forth in the Credit Agreement. Payments of
both principal and interest are to be made in lawful money of the United States
of America to the deposit account located in New York City and identified in the
Credit Agreement..
This Note
evidences indebtedness incurred under, and is subject to the terms and
provisions of, the Amended and Restated Credit Agreement, dated as of June __,
2008 (as amended, supplemented, restated or otherwise modified from time to
time, the “Credit
Agreement”; terms not otherwise defined herein are used herein as defined
in the Credit Agreement), among Borrower, Earth Biofuels, Inc., a Delaware
corporation, the other Loan Parties named therein, the financial institutions
(including Lender) party thereto from time to time and Agent, to which Credit
Agreement reference is hereby made for a statement of the terms and provisions
under which this Note may or must be paid prior to its due date or its due date
accelerated.
This Note
is made under and governed by the laws of the State of New York applicable to
contracts made and to be performed entirely within such State.
NEW EARTH
LNG, LLC
By:
Title:
Exhibit
D
Form of Excess Cash Flow
Certificate
Date:
_______________, 200_
Please
refer to the Amended and Restated Credit Agreement dated as of June __, 2008 (as
amended, restated, supplemented or otherwise modified from time to time, the
"Credit Agreement") among the undersigned (together with its respective
successors and assigns, the "Borrower"), the other Loan Parties party thereto,
the financial institutions party thereto, as Lenders, and Fourth Third, LLC, as
Agent. This certificate (this "Certificate"), together with
supporting calculations attached hereto, is delivered to Agent and Lenders
pursuant to the terms of the Credit Agreement. Terms used but not
otherwise defined herein are used herein as defined in the Credit
Agreement.
The
officer executing this Certificate is a chief financial officer of Borrower and
as such is duly authorized to execute and deliver this Certificate on behalf of
Borrower. By executing this Certificate such officer hereby certifies
to Agent and Lenders that:
(a) set
forth on Schedule
1 attached hereto is a correct calculation of Excess Cash Flow for the
Fiscal Quarter period ended __________, _____ and a correct calculation of the
required prepayment of
$__________________;
(b) Schedule 1 attached
hereto is based on the financial statements which [have been delivered to Agent
in accordance with Section 6.1.1 of the
Credit Agreement] [are attached hereto as Annex A].
IN
WITNESS WHEREOF, Borrower has caused this Certificate to be executed by its
chief financial officer this _____ day of _______________, 200_.
|
NEW
EARTH LNG, LLC
By:
Title:
|
Schedule
1
to
Excess
Cash Flow Certificate
Excess
Cash Flow is defined as follows:
|
EBITDA
(from item A(3) of Exhibit B)
|
$___________
|
|
Plus: Any
Net Decrease in Adjusted Working Capital
|
$___________
|
|
Less: Scheduled
principal payments made with respect to the Loan and other Debt of
Borrower and its Subsidiaries
|
$___________
|
|
Voluntary
principal payments made with respect to the Loan
|
$___________
|
|
Federal,
state, local and foreign income taxes paid in cash for
taxes
|
$___________
|
|
Interest
Expense paid in cash
|
$___________
|
|
Increase
in Adjusted Working Capital
|
$___________
|
|
Excess
Cash Flow
|
$___________
|
|
Prepayment
percent
|
__________%
|
|
Prepayment
amount
|
$___________
|
Decrease
(increase) in Adjusted Working Capital, for the purposes of the calculation of
Excess Cash Flow, means the following:
|
Beg.
of Period
|
End
of Period
|
|
|
Consolidated
current assets:
|
$__________
|
$__________
|
|
Less: cash
|
___________
|
___________
|
|
cash equivalents
|
___________
|
___________
|
|
Adjusted
current assets
|
$___________
|
$___________
|
|
Consolidated
current liabilities:
|
$___________
|
$___________
|
|
Less:short-term
Debt (including current portion of long-term Debt)
|
___________
|
___________
|
|
Adjusted
current liabilities
|
$__________
|
$__________
|
|
Adjusted
Working Capital (adjusted consolidated current assets minus adjusted
consolidated current liabilities)
|
$__________
|
$__________
|
|
Decrease
(Increase) in Adjusted Working Capital (beginning of period minus end of
period Adjusted Working Capital)
|
$__________
|