Core Natural Resources, Inc 8-K, filed Jan 15, 2025
Core Natural Resources, Inc. (CNR)
About this 8-K
Core Natural Resources, Inc filed this 8-K on January 15, 2025, reporting on events of January 13, 2025.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.01: Completed an acquisition or sale of assets
- Item 2.03: New debt or off-balance-sheet obligation
- Item 3.03: Change to shareholders' rights
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 7.01: Regulation FD disclosure
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Introductory Note
On January 14, 2025 (the “Closing Date”), Core Natural Resources, Inc. (formerly known as CONSOL Energy Inc.), a Delaware corporation (the “Company”), completed its previously announced merger of equals transaction with Arch Resources, Inc., a Delaware corporation (“Arch”), pursuant to that certain Agreement and Plan of Merger, dated as of August 20, 2024 (the “Merger Agreement”), by and among the Company, Mountain Range Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of the Company (“Merger Sub”), and Arch. Pursuant to the terms of the Merger Agreement, Merger Sub merged with and into Arch (the “Merger”), with Arch continuing as the surviving corporation and as a wholly owned subsidiary of the Company.
| Item 1.01 | Entry into a Material Definitive Agreement. |
Amendment to Revolving Credit Facility
On January 14, 2025, and in connection with the Merger, the Company entered into Amendment No. 6 (the “Credit Facility Amendment”), which amends its existing Credit Agreement, dated as of November 28, 2017 (as amended, restated, amended and restated, supplemented or otherwise modified, the “Credit Agreement”), by and among the Company, the subsidiary guarantors party thereto, PNC Bank, National Association (“PNC Bank”), as administrative agent (the “Administrative Agent”), PNC Bank, as collateral agent (the “Collateral Agent”), and the several banks and other financial institutions or entities from time to time party thereto as lenders (the “Financial Institutions”).
The Credit Agreement, as amended by the Credit Facility Amendment, increases the available revolving commitments from $355 million to $600 million (the “Revolving Facility”). Borrowings under the Revolving Facility may be used for general corporate purposes, including working capital, capital expenditures and permitted acquisitions. Amounts repaid under the Revolving Facility may be reborrowed, subject to satisfaction of the conditions to each credit extension. The Credit Agreement provides that up to the full amount of the Revolving Facility will be available for the issuance of letters of credit (the “Letters of Credit”) by each lender under the Revolving Facility, including certain Arch letters of credit that are deemed to be issued under the Revolving Facility. The Company may increase the Revolving Credit Commitments on the same terms or incur term “A” loans in an aggregate amount of up to $150 million.
The maturity date of the Revolving Facility, as amended by the Credit Facility Amendment, is April 30, 2029, provided that if any Maryland Economic Development Corporation Port Facilities 5.75% Refunding Revenue Bonds due September 2025 (the “MEDCO Bonds”) or Pennsylvania Economic Development Financing Authority 9.00% Solid Waste Disposal Revenue Bonds due April 2028 (the “PEDFA Bonds”) are outstanding on the date that is 91 days prior to the maturity date applicable to the MEDCO Bonds or PEDFA Bonds (the “Springing Maturity Date”), and Specified Liquidity (as defined in the Credit Agreement) is less than $250 million as of such Springing Maturity Date, then the maturity date for the Revolving Facility shall be such Springing Maturity Date. Borrowings under the Revolving Facility bear interest at a floating rate that is, at the Company’s option, either (i) SOFR plus a SOFR adjustment of 0.10% plus an applicable margin or (ii) an alternate base rate plus an applicable margin. The applicable margin for the Revolving Facility depends on the total net leverage ratio and ranges from 3.00% to 3.75% (for SOFR loans) and 2.00% to 2.75% (for alternate base rate loans), depending on the total net leverage ratio.
The Company’s obligations under the Credit Agreement are fully and unconditionally guaranteed by subsidiaries of the Company that own any portion of the Company’s Pennsylvania Mining Complex, its marine terminal at the Port of Baltimore and specified coal reserves. The Credit Agreement also provides that existing or future direct or indirect wholly owned material restricted subsidiaries of the Borrower will be Guarantors under the Credit Agreement, including significant subsidiaries acquired pursuant to the Merger, subject to certain customary exceptions. The Credit Facility Amendment provides for a post-closing period during which subsidiaries acquired pursuant to the Merger will become Guarantors under the Credit Agreement. The obligations under the Credit Agreement are secured by, subject to certain exceptions (including a limitation of pledges of equity interests in certain subsidiaries and certain thresholds with respect to real property), a first-priority lien on, among other things, (i) the Company’s interest in the PAMC, (ii) the equity interests in PA Mining Complex LP held by the Company, (iii) the CONSOL Marine Terminal, (iv) the Itmann Mining Complex and (v) the 1.3 billion tons of Greenfield Reserves and Resources.
The Credit Agreement contains a number of customary affirmative covenants and a number of negative covenants, including (subject to certain exceptions) limitations on (among other things): indebtedness, liens, investments, acquisitions, asset dispositions, restricted payments, mergers, consolidations, divisions and other fundamental changes, transactions with affiliates and prepayments of junior indebtedness. The Credit Agreement will require prepayment of Revolving Credit Loans and/or Swing Loans if (x) Excess Balance Sheet Cash is greater than $125 million and (y) the sum of Revolving Credit Loans, Swing Loans and Letter of Credit Obligations (other than in respect of undrawn Letters of Credit) is greater than 25% of the Revolving Credit Commitments, in each case as of the last day of any calendar month.
The Credit Agreement also includes financial covenants, including (i) a maximum first lien gross leverage ratio, (ii) a maximum total net leverage ratio, and (iii) a minimum interest coverage ratio. Under the Revolving Facility, the maximum first lien gross leverage ratio is 1.50 to 1.00, the maximum total net leverage ratio is 2.50 to 1.00 and the minimum interest coverage ratio is 3.00 to 1.00. The Credit Agreement contains customary events of default, including with respect to a failure to make payments when due, cross-default and cross-judgment default and certain bankruptcy and insolvency events.
The foregoing description of the Credit Facility Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Facility Amendment, which is filed as Exhibit 10.1 hereto and incorporated herein by reference.
Amendment to Arch Securitization Facility
On the Closing Date and in connection with the Merger, a subsidiary of Arch, Arch Receivable Company, LLC, as seller, another subsidiary of Arch, Arch Coal Sales Company, Inc., as initial servicer, PNC Bank, National Association, as administrator and issuer of letters of credit thereunder, and the other parties party thereto, as securitization purchasers, entered into that certain Ninth Amendment to the Third Amended and Restated Receivables Purchase Agreement (the “Securitization Facility Amendment”), which amends that certain Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016, as amended (the “Receivables Purchase Agreement”). The Securitization Facility Amendment permits the Receivables Purchase Agreement to remain outstanding following consummation of the Merger, including by amending the change of control provisions thereunder.
The foregoing description of the Securitization Facility Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Securitization Facility Amendment, which is filed as Exhibit 10.2 hereto and incorporated herein by reference.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
The information set forth in the “Introductory Note” above is incorporated into this Item 2.01 by reference.
At the effective time of the Merger (the “Effective Time”), each share of Class A common stock, par value $0.01 per share, and Class B common stock, par value $0.01 per share, of Arch issued and outstanding immediately prior to the Effective Time (other than certain excluded shares as described in the Merger Agreement) was automatically converted into the right to receive 1.326 shares of common stock, par value $0.01 per share (the “Exchange Ratio”), of the Company (“Company Common Stock”).
In connection with the Merger, the Company issued approximately 25 million shares of Company Common Stock, which represents approximately 46% of the issued and outstanding shares of Company Common Stock after giving effect to such issuance.
At the Effective Time, the Company changed its name to “Core Natural Resources, Inc.” and retained the Company’s headquarters in Canonsburg, Pennsylvania, with the Company Common Stock continuing to trade on the New York Stock Exchange (“NYSE”). In addition, in connection with the Merger, the Company changed its NYSE ticker symbol from “CEIX” to “CNR” and the Company Common Stock is trading through a new CUSIP (218937100). The Company Common Stock began trading under the new NYSE ticker symbol and CUSIP at the open of trading on January 15, 2025.
At the Effective Time, each restricted stock unit award of Arch that was outstanding immediately prior to the Effective Time fully vested, was cancelled and automatically converted into the right to receive a number of shares of Company Common Stock equal to the product (rounded to the nearest whole number) of (x) the number of shares of Arch common stock subject to such award as of immediately prior to the Effective Time, multiplied by (y) the Exchange Ratio. Also at the Effective Time, each performance-based restricted stock unit award of Arch that was outstanding immediately prior to the Effective Time fully vested, was cancelled and automatically converted into the right to receive a number of shares of Company Common Stock equal to the product (rounded to the nearest whole number) of (I) the number of shares of Arch common stock subject to such award as of immediately prior to the Effective Time equal to the greater of (x) 100% of the target number of shares of Arch common stock subject to the award or (y) the number of shares of Arch common stock subject to the portion of the award that would have vested as of the Effective Time based on actual achievement of the performance goals related to such award as of the Effective Time, multiplied by (II) the Exchange Ratio.
In addition, at the Effective Time, each restricted stock unit award of the Company that was outstanding immediately prior to the Effective Time fully vested, was cancelled and converted into the right to receive the number of shares of Company Common Stock subject to such award as of immediately prior to the Effective Time. Also at the Effective Time, each performance-based restricted stock unit award of the Company that was outstanding immediately prior to the Effective Time fully vested, was cancelled and converted into the right to receive the number of shares of Company Common Stock equal to the number of shares of Company Common Stock subject to such award as of immediately prior to the Effective Time equal to the greater of (x) 100% of the target number of shares of Company Common Stock subject to the award or (y) the number of shares of Company Common Stock subject to the portion of the award that would have vested as of the Effective Time based on actual achievement of the performance goals related to such award as of the Effective Time.
The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, which is included as Exhibit 2.1 hereto and incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 is incorporated into this Item 2.03 by reference.
| Item 3.03 | Material Modification to Rights of Security Holders. |
The information set forth in Item 2.01 and Item 5.03 is incorporated into this Item 3.03 by reference.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Director Resignations and Appointments
In accordance with the director selection process set forth in the Merger Agreement, as of the Effective Time, the Board of Directors of the Company (the “Company Board”) was increased to eight members, consisting of (a) four directors who were members of the Company Board immediately prior to the Effective Time, and (b) four directors who were members of the Board of Directors of Arch (the “Arch Board”) immediately prior to the Effective Time.
Messrs. James A. Brock and Joseph P. Platt, and Mses. Cassandra Pan and Valli Perera, each of whom were members of the Company Board immediately prior to the Effective Time, continued to serve as directors of the Company Board as of the Effective Time.
On January 13, 2025, Mr. John T. Mills submitted his resignation from the Company Board and any and all committees thereof, effective as of the Effective Time. Such resignation was not the result, in whole or in part, of any disagreement with the Company or the Company’s management.
As of the Effective Time, Messrs. Paul A. Lang, Richard A. Navarre and Patrick A. Kriegshauser, and Ms. Holly Keller Koeppel, each of whom were members of the Arch Board immediately prior to the Effective Time, were appointed to the Company Board. In addition, as of the Effective Time, in accordance with the provisions governing post-closing corporate governance set forth in the Fourth Amended and Restated Bylaws of the Company (the “Company Bylaws”), Mr. Brock was appointed as Executive Chairman of the Company Board and Mr. Navarre was appointed as Lead Independent Director of the Company Board.
The initial term of Mr. Brock as Executive Chair of the Company Board will expire effective as of the earlier of (i) the two-year anniversary of the Effective Time or (ii) any date as of which Mr. Brock ceases to serve as a member of the Company Board for any reason in accordance with the Company Bylaws. Each other person designated as a director of the Company will serve as a director until such person’s successor has been appointed and qualified or elected or such person’s earlier death, resignation or removal in accordance with the organizational documents of the Company.
On the Closing Date and in accordance with the Merger Agreement, each non-employee director of the Company Board immediately prior to the Effective Time was paid his or her unpaid cash director fees for his or her service on the Company Board from the Company’s 2024 annual meeting of stockholders until the Company’s 2025 annual meeting of stockholders, without proration. Each of the non-employee directors of the Company Board may receive compensation for his or her services on the Company Board as determined by the Company Board following the Effective Time.
Other than as described above, there are no other arrangements or understandings between Messrs. Lang, Navarre or Kriegshauser or Ms. Koeppel and the Company or any other person pursuant to which Messrs. Lang, Navarre or Kriegshauser or Ms. Koeppel was appointed as a director of the Company. There are no related party transactions between Messrs. Lang, Navarre or Kriegshauser or Ms. Koeppel and the Company that are required to be disclosed under Item 404(a) of Regulation S-K.
As of the Effective Time, the Company Board reconstituted its Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Health, Safety and Environmental Committee as described below:
| Audit Committee
Patrick A. Kriegshauser (Chair) Valli Perera Holly Keller Koeppel |
Compensation Committee
Joseph P. Platt (Chair) Richard A. Navarre Cassandra Pan |
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| Nominating and Corporate Governance Committee
Richard A. Navarre (Chair) Joseph P. Platt Valli Perera |
Health, Safety and Environmental Committee
Cassandra Pan (Chair) Holly Keller Koeppel Patrick A. Kriegshauser |
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Officer Appointments
As of the Effective Time, Mr. Brock was appointed as Executive Chair of the Company Board and ceased to serve as Chief Executive Officer of the Company.
In accordance with the officer selection process set forth in the Merger Agreement, the following executive officers of the Company immediately prior to the Effective Time will continue to serve as executive officers of the Company as of the Effective Time in the positions indicated:
| • | James A. Brock | Executive Chair | ||
| • | Miteshkumar B. Thakkar | President and Chief Financial Officer | ||
| • | Kurt R. Salvatori | Senior Vice President and Chief Administrative Officer | ||
| • | Robert J. Braithwaite, Jr. | Senior Vice President, Marketing and Sales | ||
In addition, as of the Effective Time, in accordance with the officer selection process set forth in the Merger Agreement, the following executive officers of the Company were appointed to serve in the positions indicated, each of whom were executive officers of Arch immediately prior to the Effective Time:
| • | Paul A. Lang | Chief Executive Officer | ||
| • | Rosemary L. Klein | Senior Vice President, Chief Legal Officer and Corporate Secretary | ||
| • | George J. Schuller Jr. | Senior Vice President and Chief Operating Officer | ||
| • | Deck S. Slone | Senior Vice President, Strategy and Public Policy | ||
Each such officer will serve until such officer’s successor is appointed or such officer’s earlier death, resignation, retirement, disqualification or removal in accordance with the organizational documents of the Company. Additional information relating to the executive officers is set forth below:
Paul A. Lang, 64, served as Chief Executive Officer of Arch from April 2020 until the Effective Time and served as a director on the Arch Board from February 2020 until the Effective Time. He also served as President of Arch from April 2015 to February 2024.
Rosemary L. Klein, 57, served as Senior Vice President — Law, General Counsel and Secretary of Arch from October 2020 until the Effective Time. Prior to that, she served as special counsel in Arch’s legal department since 2015.
George J. Schuller Jr., 61, served as Senior Vice President and Chief Operating Officer of Arch from March 2024 until the Effective Time. He joined Arch after serving as Chief Operations Officer of Compass Minerals, Inc., a publicly-held global provider of essential minerals for consumer, industrial and agricultural uses, from September 2019 to February 2024.
Deck S. Slone, 61, served as Senior Vice President-Strategy and Public Policy of Arch from June 2012 until the Effective Time.
At the Effective Time, the change in control agreements between Arch and each of Messrs. Lang, Schuller and Slone and Ms. Klein, as described in the Company’s definitive joint proxy statement/prospectus filed with the Securities and Exchange Commission (the “SEC”) on November 26, 2024 (the “Joint Proxy Statement/Prospectus”) under the heading “The Merger—Interests of Arch Directors and Executive Officers in the Merger—Executive Change in Control Agreements,” were assumed by the Company. Each of the executive officers of the Company will receive compensation as determined by the Company Board following the Effective Time.
Except as described above, there are no other arrangements or understandings between Messrs. Lang, Schuller or Slone or Ms. Klein and the Company or any other person pursuant to which Messrs. Lang, Schuller or Slone or Ms. Klein was selected as an officer of the Company. There are no family relationships between Messrs. Lang, Schuller or Slone or Ms. Klein and any director or executive officer of the Company. There are no related party transactions between Messrs. Lang, Schuller or Slone or Ms. Klein and the Company that are required to be disclosed under Item 404(a) of Regulation S-K.
Entry into Indemnification Agreements
The officers and directors of the Company have entered or will enter into indemnification agreements with the Company (the “Indemnification Agreements”). Pursuant to the Indemnification Agreements, subject to the exceptions and limitations provided therein, the Company will indemnify each officer and director of the Company for obligations he or she may incur in his or her capacity as an officer or director. The foregoing description of the Indemnification Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of the Form of Indemnification Agreement, which is filed as Exhibit 10.3 hereto and incorporated herein by reference.
| Item 5.03 | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
On January 14, 2025, the Company filed an amendment to its Amended and Restated Certificate of Incorporation, as amended, with the Secretary of State of the State of Delaware (the “Charter Amendment”) to (i) change its name to “Core Natural Resources, Inc.” and (ii) increase the number of authorized shares of Company Common Stock from 62,500,000 shares to 125,000,000 shares. The Charter Amendment was authorized and adopted by the Company Board in accordance with Section 242(b)(1) of the General Corporation Law of the State of Delaware. Company stockholders approved the Charter Amendment at a Special Meeting of Stockholders held on January 9, 2025. The Charter Amendment became effective upon filing.
The foregoing description of the Charter Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Charter Amendment, which is filed as Exhibit 3.1 hereto and incorporated herein by reference.
Effective upon the Effective Time, the Company adopted the Company Bylaws to (i) update the Company’s name to “Core Natural Resources, Inc.,” (ii) add certain corporate governance provisions as described in the Joint Proxy Statement/Prospectus under the heading “Amended and Restated Bylaws of the Combined Company” and (iii) make certain other updates and conforming changes.
The foregoing description of the Company Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Company Bylaws, which is filed as Exhibit 3.2 hereto and incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. |
On January 14, 2025, the Company issued a press release announcing the completion of the previously announced Merger. A copy of that press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
The information included in this Item 7.01 and Exhibit 99.1 attached hereto is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall the information included in this Item 7.01 and Exhibit 99.1 attached hereto be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 8.01 | Other Matters. |
On January 13, 2025, the Company purchased an aggregate principal amount of $98.1 million of the outstanding (i) Solid Waste Disposal Facility Revenue Bonds (Arch Resources Project), Series 2020, and (ii) Solid Waste Disposal Facility Revenue Bonds (Arch Resources Project), Series 2021 (together, the “Arch Bonds”), which were issued by the West Virginia Economic Development Authority for the benefit of Arch. The Company also consented to the release of all liens, mortgages and security interests granted or purported to be granted pursuant to the security documents relating to the Arch Bonds and to the termination of all such security documents. The $98.1 million of Arch Bonds purchased by the Company on January 13, 2025 constitute all of the outstanding Arch Bonds.
On the Closing Date and in connection with the Merger, Arch terminated all outstanding obligations under (i) the Credit Agreement, dated as of February 8, 2024, by and among Arch, as borrower, the guarantors party thereto, the lenders from time to time party thereto and PNC Bank, National Association, in its capacity as administrative agent, as amended, and (ii) the Credit Agreement, dated as of April 27, 2017, by and among Arch and
certain of its subsidiaries, as borrowers, the lenders from time to time party thereto and Regions Bank, in its capacities as administrative agent and as collateral agent, as amended.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| † | Schedules (or similar attachments) have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish supplementally copies of any of the omitted schedules upon request by the SEC. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CORE NATURAL RESOURCES, INC. | ||
| By: | /s/ Miteshkumar B. Thakkar | |
| Miteshkumar B. Thakkar | ||
| President and Chief Financial Officer | ||
Date: January 15, 2025
Exhibit 3.1
CERTIFICATE OF AMENDMENT
TO AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
CONSOL ENERGY INC.
CONSOL Energy Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware (the “DGCL”), hereby adopts this Certificate of Amendment (this “Certificate of Amendment”), which amends its Amended and Restated Certificate of Incorporation, as heretofore amended (the “Certificate of Incorporation”), as described below, and does hereby further certify that:
FIRST: The Board of Directors of the Corporation has duly adopted a resolution proposing and declaring advisable the amendment to the Certificate of Incorporation described herein (the “Amendment”) and directing that the Amendment be submitted for consideration by the stockholders of the Corporation, and the holders of a majority of the outstanding Common Stock, par value of $0.01 per share, of the Corporation entitled to vote at the special meeting of the stockholders called and held upon notice in accordance with Section 222 of the DGCL for the purpose of voting on the Amendment have voted in favor of the Amendment.
SECOND: Article I of the Certificate of Incorporation is amended and restated to read in its entirety as follows:
(a) The name of the corporation is Core Natural Resources, Inc.
THIRD: Article IV, Section 4.1, paragraph (a) of the Certificate of Incorporation is amended and restated to read in its entirety as follows:
(a) The total number of shares of capital stock which the Corporation shall have authority to issue is 125,500,000, which shall be divided into two classes, consisting of 125,000,000 shares of Common Stock, par value of $0.01 per share (the “Common Stock”), and 500,000 shares of Preferred Stock, par value of $0.01 per share (the “Preferred Stock”).
FOURTH: That said amendments were duly adopted in accordance with the provisions of Section 242 of the DGCL. The foregoing amendments shall be effective upon filing with the Secretary of State of the State of Delaware.
FIFTH: All other provisions of the Amended and Restated Certificate of Incorporation shall remain in full force and effect.
[Signature Page Follows]
IN WITNESS WHEREOF, this Certificate of Amendment has been executed by an authorized officer of the Corporation as of this 14th day of January, 2025.
| CONSOL ENERGY INC. | ||
| By: | /s/ James A. Brock | |
| Name: James A. Brock | ||
| Title: Chairman and Chief Executive Officer | ||
Exhibit 3.2
FOURTH AMENDED AND RESTATED
BYLAWS
OF
CORE NATURAL RESOURCES, INC.
Incorporated under the Laws of the State of Delaware
(effective January 14, 2025)
ARTICLE I
OFFICES AND RECORDS
SECTION 1.1. Delaware Office. The registered office of Core Natural Resources, Inc. (the “Corporation”) in the State of Delaware shall be located in the City of Wilmington, County of New Castle, and the name and address of its registered agent is The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.
SECTION 1.2. Other Offices. The Corporation may have such other offices, either inside or outside the State of Delaware, as the Board of Directors of the Corporation (the “Board of Directors”) may from time to time designate or as the business of the Corporation may require.
SECTION 1.3. Books and Records. The books and records of the Corporation may be kept inside or outside the State of Delaware at such place or places as may from time to time be designated by the Board of Directors.
ARTICLE II
STOCKHOLDERS
SECTION 2.1. Annual Meeting. An annual meeting of the stockholders of the Corporation for the purpose of electing directors and conducting such other proper business as may come before the meeting shall be held at such date, time and place (if any) as may be fixed by resolution of the Board of Directors.
SECTION 2.2. Special Meetings. Subject to the rights of the holders of any then outstanding series of stock having a preference over the Common Stock of the Corporation as to dividends, voting or upon liquidation (“Preferred Stock”) with respect to such series of Preferred Stock, special meetings of the stockholders may be called only by or at the direction of (i) the Chair of the Board of Directors, the Chief Executive Officer or the Board of Directors pursuant to a resolution adopted by a majority of the total number of directors which the Corporation would have if there were no vacancies (the “Whole Board”), and any power of stockholders to call a special meeting is specifically denied. The record date for, and the date, time, and place (if any) of, any special meeting, shall be fixed by the Board of Directors.
SECTION 2.3. Place of Meeting. The Board of Directors or the Chair of the Board of Directors, as the case may be, may designate the place of meeting for any annual or special meeting of the stockholders. If no designation is so made, the place of meeting shall be the principal office of the Corporation. The Board of Directors may also, in its sole discretion, determine that any meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication in accordance with the General Corporation Law of the State of Delaware (the “DGCL”). If authorized by the Board of Directors in its sole discretion, and subject to such guidelines and procedures as the Board of Directors may adopt and in accordance with the DGCL, stockholders and proxy holders not physically present at a meeting of stockholders may, by means of remote communication (a) participate in a meeting of stockholders; and (b) be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated place or solely by means of remote communication.
SECTION 2.4. Notice of Meeting. Whenever stockholders are required or permitted to take action at a meeting, written or printed notice stating the place (if any), date, time, the means of remote communications (if any) by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of special meetings, the purpose or purposes, of such meeting, shall be given to each stockholder of record entitled to vote at such meeting as of the record date for determining stockholders entitled to notice of the meeting not less than ten (10) nor more than sixty (60) days before the date of the meeting. All such notices shall be delivered, either personally or by mail, or by electronic transmission in the manner provided in Section 232 of the DGCL (except to the extent prohibited by Section 232(e) of the DGCL) by or at the direction of the Board of Directors, the Chair of the Board of Directors, the Chief Executive Officer or the Corporate Secretary, and if mailed, such notice shall be deemed to be delivered when deposited in the United States mail, postage prepaid, addressed to the stockholder at his, her or its address as the same appears on the records of the Corporation. In the case of notice given by commercial delivery service, such notice shall be deemed to be given when delivered into the control of the persons charged with effecting such delivery, the delivery charge to be paid by the Corporation or the person sending such notice and not by the addressee. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the stockholder attends for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened. A stockholder may also waive notice of a meeting as provided in Section 7.4 of these Bylaws. Any previously scheduled meeting of the stockholders may be postponed, and (unless the Amended and Restated Certificate of Incorporation of the Corporation (as amended from time to time, the “Certificate of Incorporation”) otherwise provides) any special meeting of the stockholders may be cancelled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders.
SECTION 2.5. Quorum; Adjournment and Postponement. Except as otherwise provided by law or by the Certificate of Incorporation, the holders of a majority in voting power of the outstanding shares of capital stock entitled to vote at the meeting, present in person or by proxy, shall constitute a quorum at all meetings of stockholders. Except as otherwise provided by applicable law or the Certificate of Incorporation or these Bylaws, when a specified item of business requires a separate vote by a class or series or classes or series of stock, the holders of a majority of the outstanding shares of such class or series or classes or series entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum for the transaction of such business. The Chair of the Board of Directors, the Chief Executive Officer or chair of a meeting may adjourn or postpone the meeting for any purpose (including due to a technical failure to convene or continue a meeting using remote communication) and to any other time and other place (if any) at which a meeting may be held under these Bylaws. When a meeting is adjourned to another time or place (if any), notice need not be given of the adjourned meeting if: (a)(i) the time, the place (if any), and the means of remote communication, if any, by which stockholders may be deemed to be present and vote at the meeting, are: (A) announced at the meeting at which the adjournment is taken; (B) displayed during the time for the meeting, on the same electronic network used to enable stockholders to participate in the meeting by means of remote communication; or (C) set forth in the notice of the meeting given in accordance with these Bylaws; and (ii) the date of the adjourned meeting is not more than thirty (30) days after the date for which the meeting was originally noticed, or if a new record date is fixed for the adjourned meeting, notice stating the place (if any), date, time, and means of remote communication, if any, will be sent as provided in Section 2.4 of these Bylaws or (b) otherwise permitted by applicable law. The stockholders present at a duly called meeting at which a quorum is present may continue to transact business until adjournment or postponement, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.
SECTION 2.6. Conduct of Meetings. Meetings of stockholders shall be presided over by such person as the Board of Directors may designate as chair of the meeting, or in the absence of such a person, the Chair of the Board of Directors, or if none or in the Chair of the Board of Directors’ absence or inability to act, the Chief Executive Officer, or if none or in the Chief Executive Officer’s absence or inability to act, the President, or if none or in the President’s absence or inability to act, a Vice President, or, if none of the foregoing is present or able to act, by a chair to be chosen by the holders of a majority of the shares entitled to vote who are present in person or by proxy at the meeting. The Secretary, or in the Secretary’s absence, an Assistant Secretary, shall act as secretary of every meeting, but if neither the Secretary nor an Assistant Secretary is present, the chair of the meeting shall appoint any person present to act as secretary of the meeting. The Board of Directors shall be entitled to make such rules or regulations for the conduct of meetings of stockholders as it shall deem necessary, appropriate or convenient. Subject to such rules and regulations of the Board of Directors, if any, the chair of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such
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chair, are necessary, appropriate or convenient for the proper conduct of the meeting, including, without limitation, establishing an agenda or order of business for the meeting, rules and procedures for maintaining order at the meeting and the safety of those present, limitations on participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies and such other persons as the chair shall permit, restrictions on entry to the meeting after the time fixed for the commencement thereof, limitations on the time allotted to questions or comments by participants and regulation of the opening and closing of the polls for balloting and matters which are to be voted on by ballot. Unless and to the extent determined by the Board of Directors or the person presiding over the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
SECTION 2.7. Proxies. At all meetings of stockholders, a stockholder may vote by proxy executed in writing (or in such manner prescribed by the DGCL) by the stockholder, or by such stockholder’s duly authorized attorney in fact.
SECTION 2.8. Notice of Nominations and Stockholder Business.
(A) Annual Meetings of Stockholders. At any annual meeting of the stockholders, only such nominations of individuals for election to the Board of Directors shall be made, and only such other business shall be conducted or considered, as shall have been properly brought before the meeting. For nominations to be properly made at an annual meeting, and for proposals of other business to be properly brought before an annual meeting, such nominations and proposals of other business must be: (a) specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (b) otherwise properly made at the annual meeting by or at the direction of the Board of Directors or (c) otherwise properly requested to be brought before the annual meeting by a stockholder of the Corporation in accordance with these Bylaws. For nominations of individuals for election to the Board of Directors or proposals of other business to be properly requested by a stockholder to be made at an annual meeting, a stockholder must (i) be a stockholder of record at the time of giving of notice of such annual meeting by or at the direction of the Board of Directors and at the time of the annual meeting, (ii) be entitled to vote at such annual meeting and (iii) comply with the procedures set forth in these Bylaws as to such business or nomination. The immediately preceding sentence shall be the exclusive means for a stockholder to make nominations or bring other business proposals (other than matters properly brought under Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and included in the Corporation’s notice of meeting) before an annual meeting of stockholders.
(B) Special Meetings of Stockholders. At any special meeting of the stockholders, only such business shall be conducted or considered as shall have been properly brought before the meeting. To be properly brought before a special meeting, proposals of business must be (i) specified in the Corporation’s notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors or (ii) otherwise properly brought before the special meeting by or at the direction of the Board of Directors; provided, however, that nothing herein shall prohibit the Board of Directors from submitting additional matters to stockholders at any such special meeting.
Nominations of individuals for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting (a) by or at the direction of the Board of Directors or (b) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any stockholder of the Corporation who (1) is a stockholder of record at the time of giving notice with respect to such special meeting and at the time of the special meeting, (2) is entitled to vote at the meeting, and (3) complies with the procedures set forth in these Bylaws as to such nomination. This Section 2.8(B) shall be the exclusive means for a stockholder to make nominations or bring other business proposals (other than matters properly brought under Rule 14a-8 under the Exchange Act and included in the Corporation’s notice of meeting) before a special meeting of stockholders.
(C) General. Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, the chair of any annual or special meeting shall have the power to determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with these Bylaws and, if any proposed nomination or other business is not in compliance with these Bylaws, to declare that no action shall be taken on such nomination or other proposal and such nomination or other proposal shall be disregarded. Unless otherwise required by law, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or proposed business, such nomination shall be disregarded and such proposed business shall not be transacted,
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notwithstanding that proxies in respect of such vote may have been received by the Corporation. For purposes of this paragraph, to be considered a qualified representative of the stockholder, a person must be a duly authorized officer, manager or partner of such stockholder or must be authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders.
SECTION 2.9. Advance Notice of Stockholder Business and Nominations.
(A) Annual Meeting of Stockholders. Without qualification or limitation, subject to Section 2.9(C)(4) of these Bylaws, for any nominations or any other business to be properly brought before an annual meeting by a stockholder pursuant to Section 2.8(A) of these Bylaws, the stockholder must have given timely notice thereof (including, in the case of nominations, the completed and signed questionnaire, representation and agreement required by Section 2.10 of these Bylaws), and timely updates and supplements thereof, in each case in proper form, in writing to the Secretary, and such other business must otherwise be a proper matter for stockholder action.
To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the one hundred and twentieth (120th) day and not later than the close of business on the ninetieth (90th) day prior to the first anniversary of the preceding year’s annual meeting. Notwithstanding the foregoing, if the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after the first anniversary of the preceding year’s annual meeting, then, to be timely, notice by the stockholder must be so delivered not earlier than the close of business on the one hundred and twentieth (120th) day prior to the date of such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to the date of such annual meeting or, if the first public announcement of the date of such annual meeting is less than one hundred (100) days prior to the date of such annual meeting, the tenth (10th) day following the day on which public announcement of the date of such meeting is first made by the Corporation. In no event shall any adjournment or postponement of an annual meeting, or the public announcement thereof, commence a new time period for the giving of a stockholder’s notice as described above.
Notwithstanding anything in the immediately preceding paragraph to the contrary, in the event that the number of directors to be elected to the Board of Directors is increased by the Board of Directors, and there is no public announcement by the Corporation naming all of the nominees for director or specifying the size of the increased Board of Directors at least one hundred (100) days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 2.9(A) shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the tenth (10th) day following the day on which such public announcement is first made by the Corporation.
In addition, to be considered timely, a stockholder’s notice shall further be updated and supplemented, if necessary, so that the information provided or required to be provided in such notice shall be true and correct as of the record date for the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for the meeting in the case of the update and supplement required to be made as of the record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof. For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these Bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or under any other provision of the Bylaws or enable or be deemed to permit a stockholder who has previously submitted notice hereunder or under any other provision of the Bylaws to amend or update any proposal or to submit any new proposal, including by changing or adding nominees, matters, business and/or resolutions proposed to be brought before a meeting of the stockholders.
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(B) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been properly brought before the meeting pursuant to Section 2.8(B) of these Bylaws. Subject to Section 2.9(C)(4) of these Bylaws, in the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any stockholder may nominate an individual or individuals (as the case may be) for election to such position(s) as specified in the Corporation’s notice of meeting, provided that the stockholder gives timely notice thereof (including the completed and signed questionnaire, representation and agreement required by Section 2.10 of these Bylaws), and timely updates and supplements thereof in each case in proper form, in writing, to the Secretary. To be timely, a stockholder’s notice pursuant to the preceding sentence shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the one hundred twentieth (120th) day prior to the date of such special meeting and not later than the close of business on the later of the ninetieth (90th) day prior to the date of such special meeting or, if the first public announcement of the date of such special meeting is less than one hundred (100) days prior to the date of such special meeting, the tenth (10th) day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall any adjournment or postponement of a special meeting of stockholders, or the public announcement thereof, commence a new time period for the giving of a stockholder’s notice as described above. In addition, to be considered timely, a stockholder’s notice pursuant to the first sentence of this paragraph shall further be updated and supplemented, if necessary, so that the information provided or required to be provided in such notice shall be true and correct as of the record date for the meeting and as of the date that is ten (10) business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to the Secretary at the principal executive offices of the Corporation not later than five (5) business days after the record date for the meeting in the case of the update and supplement required to be made as of the record date, and not later than eight (8) business days prior to the date for the meeting or any adjournment or postponement thereof in the case of the update and supplement required to be made as of ten (10) business days prior to the meeting or any adjournment or postponement thereof.
(C) Disclosure Requirements.
(1) To be in proper form, a stockholder’s notice given pursuant to this Section 2.9 to the Secretary must include the following, as applicable:
(a) As to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made: (i) the name and address of such stockholder, as they appear on the Corporation’s books, of such beneficial owner, if any, and of their respective affiliates or associates or others acting in concert therewith, (ii) (A) the class or series and number of shares of the Corporation which are, directly or indirectly, owned beneficially and of record by such stockholder, such beneficial owner and/or their respective affiliates or associates or others acting in concert therewith, (B) any option, warrant, convertible security, stock appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the Corporation or with a value derived in whole or in part from the value of any class or series of shares of the Corporation, any derivative or synthetic arrangement having the characteristics of a long position in any class or series of shares of the Corporation, or any contract, derivative, swap or other transaction or series of transactions designed to produce economic benefits and risks that correspond substantially to the ownership of any class or series of shares of the Corporation, including due to the fact that the value of such contract, derivative, swap or other transaction or series of transactions is determined by reference to the price, value or volatility of any class or series of shares of the Corporation, whether or not such instrument, contract or right shall be subject to settlement in the underlying class or series of shares of the Corporation, through the delivery of cash or other property, or otherwise, and without regard to whether the stockholder of record, the beneficial owner, if any, or any affiliates or associates or others acting in concert therewith, may have entered into transactions that hedge or mitigate the economic effect of such instrument, contract or right, or any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the Corporation (any of the foregoing, a “Derivative Instrument”) directly or indirectly owned beneficially by such stockholder, the beneficial owner, if any, and/or any affiliates or associates or others acting in concert therewith, (C) any proxy, contract, arrangement, understanding, or relationship pursuant to which such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith has any right to vote any class or series of shares of the Corporation, (D) any agreement, arrangement, understanding, relationship or otherwise, including any repurchase or similar so-called “stock borrowing” agreement or arrangement (regardless of the purpose or effect of such repurchase or “stock borrowing” agreement or arrangement), involving such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith, directly or indirectly, the purpose or effect of which is to mitigate loss to, reduce the economic risk (of
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ownership or otherwise) of any class or series of the shares of the Corporation by, manage the risk of share price changes for, or increase or decrease the voting power of, such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith with respect to any class or series of the shares of the Corporation, or which provides, directly or indirectly, the opportunity to profit or share in any profit derived from any decrease in the price or value of any class or series of the shares of the Corporation (any of the foregoing, a “Short Interest”), (E) any rights to dividends on the shares of the Corporation owned beneficially by such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith that are separated or separable from the underlying shares of the Corporation, (F) any proportionate interest in shares of the Corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith is a general partner or, directly or indirectly, beneficially owns an interest in a general partner of such general or limited partnership, (G) any performance-related fees (other than an asset-based fee) to which such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith is entitled based on any increase or decrease in the value of shares of the Corporation or Derivative Instruments, if any, including without limitation any such interests held by members of the immediate family sharing the same household of such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith, (H) any significant equity interests or any Derivative Instruments or Short Interests in any principal competitor of the Corporation held by such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith and (I) any direct or indirect interest of such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith in any contract with the Corporation, any affiliate of the Corporation or any principal competitor of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement), (iii) all information that would be required to be set forth in a Schedule 13D filed pursuant to Rule 13d-1(a) or an amendment pursuant to Rule 13d-2(a) if such a statement were required to be filed under the Exchange Act and the rules and regulations promulgated thereunder by such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith, if any, and (iv) any other information relating to such stockholder, such beneficial owner and/or any of their respective affiliates or associates or others acting in concert therewith, if any, that would be required to be disclosed in a proxy statement and form of proxy or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder;
(b) If the notice relates to any business other than a nomination of a director or directors that the stockholder proposes to bring before the meeting, a stockholder’s notice must, in addition to the matters set forth in paragraph (a) above, also set forth: (i) a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest of such stockholder, such beneficial owner and each of their respective affiliates or associates or others acting in concert therewith, if any, in such business, (ii) the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such proposal or business includes a proposal to amend the Bylaws of the Corporation, the text of the proposed amendment), and (iii) a description of all agreements, arrangements and understandings between or among any of such stockholder, such beneficial owner and each of their respective affiliates or associates or others acting in concert therewith, if any, and any other person or persons (including their names) in connection with the proposal of such business by such stockholder;
(c) As to each individual, if any, whom the stockholder proposes to nominate for election or reelection to the Board of Directors, a stockholder’s notice must, in addition to the matters set forth in paragraph (a) above, also set forth: (i) all information relating to such individual that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder (including such individual’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected) and (ii) a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three (3) years, and any other material relationships, between or among such stockholder and beneficial owner, if any, and their respective affiliates and associates, or others acting in concert therewith, on the one hand, and each proposed nominee, and his or her respective affiliates and associates, or others acting in concert therewith, on the other hand, including, without limitation all information that would be required to be disclosed pursuant to Rule 404 of Regulation S-K or any successor provision promulgated under the Exchange Act if the stockholder making the nomination and any beneficial owner on whose behalf the nomination is made, if any, or any affiliate or associate thereof or person acting in concert therewith, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant;
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(d) With respect to each individual, if any, whom the stockholder proposes to nominate for election or reelection to the Board of Directors, a stockholder’s notice must, in addition to the matters set forth in paragraphs (a) and (c) above, also include a completed and signed questionnaire, representation and agreement as required by Section 2.10 of these Bylaws. The Corporation may require any proposed nominee to furnish such other information as may reasonably be required by the Corporation to determine the eligibility of such proposed nominee to serve as an independent director of the Corporation or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such nominee. Notwithstanding anything to the contrary, only persons who are nominated in accordance with the procedures set forth in these Bylaws, including without limitation Sections 2.9, 2.10 and 2.11 hereof, shall be eligible for election as directors;
(e) In addition to the requirements set forth in this Section 2.9 with respect to any nomination proposed to be made at a meeting, any stockholder, beneficial owner, if any, on whose behalf the nomination is being made, or their respective affiliates and associates, or others working in concert therewith, if any, intending to solicit proxies pursuant to Rule 14a-19 of the Exchange Act shall deliver notice to the Corporation in accordance with this Section 2.9 and such notice shall include: (i) the names, business addresses, and, if known, residence addresses of all nominees for whom the stockholder, beneficial owner, if any, or their respective affiliates and associates, or others acting in concert therewith, if any, intends to solicit proxies; (ii) the names, business addresses, and, if known, residence addresses of all nominees who would be presented for election at the meeting of stockholders in the event of a need to change the stockholder’s, beneficial owner’s, if any, or their respective affiliates’ and associates’, or others’ acting in concert therewith, if any, original slate; and (iii) a representation that the stockholder, beneficial owner, if any, or their respective affiliates and associates, or others acting in concert therewith intends to solicit proxies in support of director nominees other than the Corporation’s nominees in accordance with Rule 14a-19 promulgated under the Exchange Act, including the solicitation of the holders of shares representing at least 67% of the voting power of shares entitled to vote on the election of directors;
(f) Upon request of the Corporation, if a stockholder, beneficial owner, if any, on whose behalf the nomination is being made, or their respective affiliates and associates, or others acting in concert therewith, if any, provides notice pursuant to Rule 14a-19(b) of the Exchange Act, such stockholder, beneficial owner, if any, or their respective affiliates and associates, or others acting in concert therewith, if any, shall deliver to the Corporation, no later than five (5) business days prior to the applicable meeting of stockholders, reasonable evidence that it has met requirements of Rule 14a-19(a)(3) of the Exchange Act; and
(g) Unless otherwise required by applicable law, if any stockholder, beneficial owner, if any, on whose behalf the nomination is being made, or their respective affiliates and associates, or others acting in concert therewith, if any, provides notice pursuant to Rule 14a-19(b) of the Exchange Act and such stockholder, beneficial owner, or their respective affiliates and associates, or others working in concert therewith subsequently fails to comply with any requirements of Rule 14a-19 of the Exchange Act, any other rules or regulations thereunder, or these Bylaws, then the Corporation will disregard any proxies or votes solicited for such nominees and such nomination will be disregarded.
(2) For purposes of these Bylaws, “public announcement” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of these Bylaws, “affiliate” and “associate” shall have the meanings ascribed thereto in Rule 405 under the Exchange Act; provided, however, that the term “partner” as used in the definition of “associate” shall not include any limited partner that is not involved in the management of the relevant partnership.
(3) Notwithstanding the provisions of these Bylaws, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Bylaw; provided, however, that any references in these Bylaws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the separate and additional requirements set forth in these Bylaws with respect to nominations or proposals as to any other business to be considered.
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(4) Nothing in this Section 2.9 shall be deemed to affect any rights (i) of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act or (ii) of the holders of any series of Preferred Stock if and to the extent provided for under law, the Certificate of Incorporation or these Bylaws. Subject to Rule 14a-8 and Rule 14a-19 under the Exchange Act, nothing in this Section 2.9 shall be construed to permit any stockholder, or give any stockholder the right, to include or have disseminated or described in the Corporation’s proxy statement any nomination of director or directors or any other business proposal.
SECTION 2.10. Submission of Questionnaire, Representation and Agreement. To be eligible to be a nominee for election or reelection as a director of the Corporation, a person nominated by a stockholder for election or reelection to the Board of Directors must deliver (in accordance with the time periods prescribed for delivery of notice under Section 2.9 of these Bylaws) to the Secretary at the principal executive offices of the Corporation a written questionnaire with respect to the background and qualification of such individual and the background of any other person or entity on whose behalf, directly or indirectly, the nomination is being made (which questionnaire shall be provided by the Secretary upon written request), and a written representation and agreement (in the form provided by the Secretary upon written request) that such individual (A) is not and will not become a party to (1) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the Corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed to the Corporation, or (2) any Voting Commitment that could limit or interfere with such individual’s ability to comply, if elected as a director of the Corporation, with such individual’s fiduciary duties under applicable law, (B) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the Corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed therein, (C) will comply with the Corporation’s corporate governance guidelines and other policies applicable to its directors, and has disclosed therein whether all any portion of securities of the Corporation were purchased with any financial assistance provided by any other person and whether any other person has any interest in such securities, (D) in such individual’s personal capacity and on behalf of any person or entity on whose behalf, directly or indirectly, the nomination is being made, would be in compliance, if elected as a director of the Corporation, and will comply, with all applicable corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines of the Corporation publicly disclosed from time to time, (E) consents to being named as a nominee in any proxy statement pursuant to Rule 14a-4(d) under the Exchange Act and any associated proxy card and agrees to serve if elected as a director and (F) will abide by the requirements of Section 2.11 of these Bylaws.
SECTION 2.11. Procedure for Election of Directors; Required Vote.
(A) Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, a plurality of the votes cast at any meeting for the election of directors at which a quorum is present shall elect directors. The Board of Directors or chair of the meeting may, in their or his or her sole discretion, require that any votes cast for the election of directors at such meeting be cast by written ballot.
(B) If a nominee for director who is an incumbent director receives a greater number of votes “withheld” from his or her election than votes “for” such director nominee’s election, he or she shall promptly tender his or her resignation to the Board of Directors following certification of the election results. The Nominating and Corporate Governance Committee shall make a recommendation to the Board of Directors as to whether to accept or reject the tendered resignation, or whether other action should be taken. The Board of Directors shall act on the tendered resignation, taking into account the Nominating and Corporate Governance Committee’s recommendation, and publicly disclose (by a press release, a filing with the Securities and Exchange Commission or other broadly disseminated means of communication) its decision regarding the tendered resignation and the rationale behind the decision within ninety (90) days from the date of the certification of the election results. The Nominating and Corporate Governance Committee in making its recommendation, and the Board of Directors in making its decision, may each consider any factors or other information that it considers appropriate and relevant. The director who tenders his or her resignation shall not participate in the recommendation of the Nominating and Corporate Governance Committee or the decision of the Board of Directors with respect to his or her resignation. If such incumbent director’s resignation is not accepted by the Board of Directors, such director shall continue to serve until the next annual meeting and until his or her successor is duly elected, or his or her earlier resignation or removal. If a director’s resignation is accepted by the Board of Directors pursuant to these Bylaws, or if a nominee for director is not elected and the nominee is not an incumbent director, then the Board of Directors, in its sole discretion, may fill any resulting vacancy pursuant to the provisions of Section 3.10.
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(C) Except as otherwise provided by law, the Certificate of Incorporation, or these Bylaws, in all matters other than the election of directors, the affirmative vote of a majority of the shares present in person or represented by proxy at a meeting at which is quorum is present and entitled to vote on the matter shall be the act of the stockholders. The Board of Directors or chair of a meeting may, in their or his or her sole discretion, require that any votes cast at such meeting shall be cast by written ballot.
(D) Any individual who is nominated for election to the Board of Directors at an annual meeting shall, if requested by the Corporation, tender an irrevocable resignation in advance of the annual meeting. Such resignation shall become effective upon a determination by the Board of Directors or any committee thereof that (1) the information provided to the Corporation by such individual or, if applicable, by any stockholder who nominated such individual, was untrue in any material respect or omitted to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading or (2) such individual or, if applicable, any stockholder who nominated such individual, shall have breached any representations or obligations owed to the Corporation under these Bylaws.
SECTION 2.12. Inspectors of Elections; Opening and Closing the Polls. The Board of Directors by resolution shall appoint one or more inspectors, which inspector or inspectors may, but does not need to, include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives, to act at the meetings of stockholders and make a written report thereof. One or more persons may be designated as alternate inspectors to replace any inspector who fails to act. If no inspector or alternate has been appointed to act or is able to act at a meeting of stockholders, the chair of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspectors shall have the duties prescribed by law. The chair of the meeting shall be appointed by the inspector or inspectors to fix and announce at the meeting the date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting.
SECTION 2.13. Stockholder Action by Written Consent. Subject to the rights of the holders of any then outstanding series of Preferred Stock with respect to such series of Preferred Stock, any action required or permitted to be taken by the stockholders of the Corporation at an annual or special meeting of stockholders of the Corporation may be taken without a meeting, without prior notice, and without a vote, only if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the stockholders entitled to vote with respect to the action that is the subject of the consent.
ARTICLE III
BOARD OF DIRECTORS
SECTION 3.1. General Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authorities by these Bylaws expressly conferred upon it, the Board of Directors shall have and may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these Bylaws required to be exercised or done by the stockholders.
SECTION 3.2. Number and Tenure of Directors.
(A) Subject to the rights of the holders of any series of Preferred Stock to elect directors, the number of directors shall be fixed from time to time exclusively pursuant to a resolution adopted by the affirmative vote of a majority of the total number of directors that the Corporation would have if there were no vacancies (the “Whole Board”); provided that prior to the Expiration Date (as defined below), the number of directors shall be fixed in accordance with, and shall require the approvals set forth in, Article X of these Bylaws. No decrease in the number of authorized directors constituting the Whole Board shall shorten the term of any incumbent director.
(B) Subject to the rights of any holders of any class or any series of Preferred Stock to elect directors, all directors up for election shall be elected for a term expiring at the next annual meeting of stockholders.
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SECTION 3.3. Election of Directors. The directors shall be elected at the annual meetings of stockholders as specified in the Certificate of Incorporation, except as otherwise provided in the Certificate of Incorporation or in these Bylaws, and each director of the Corporation shall hold office until such director’s successor is elected and qualified or until such director’s earlier death, resignation or removal.
SECTION 3.4. Regular Meetings. A regular meeting of the Board of Directors shall be held immediately after, and at the same place, if any, as, the annual meeting of stockholders, or such other date, time and place as the Board of Directors may provide by resolution without other notice than this Bylaw, or such resolution, as applicable. The Board of Directors may, by resolution, provide the date, time and place, if any, for the holding of additional regular meetings without other notice than such resolution.
SECTION 3.5. Special Meetings. Special meetings of the Board of Directors shall be called at the request of the Chair of the Board of Directors, the Chief Executive Officer or a majority of the Board of Directors then in office. The person or persons authorized to call special meetings of the Board of Directors may fix the place, if any, date and time of the meetings.
SECTION 3.6. Notice of Meeting. Notice of any special meeting of directors shall be given to each director at such person’s business or residence in writing by hand delivery, first-class or overnight mail or courier service, email or facsimile transmission, or orally by telephone. If mailed by first-class mail, such notice shall be deemed adequately delivered when deposited in the United States mail so addressed, with postage thereon prepaid, at least five (5) days before such meeting. If by overnight mail or courier service, such notice shall be deemed adequately delivered when the notice is delivered to the overnight mail or courier service company at least twenty-four (24) hours before such meeting. If by email, facsimile transmission, telephone or by hand, such notice shall be deemed adequately delivered when the notice is transmitted at least twelve (12) hours before such meeting. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice of such meeting. A meeting may be held at any time without notice if all the directors are present or if those not present waive notice of the meeting in accordance with Section 7.4 of these Bylaws.
SECTION 3.7. Action by Consent of Board of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board of Directors or committee, as the case may be, consent thereto in writing, or by electronic transmission and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board of Directors or applicable committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.
SECTION 3.8. Conference Telephone Meetings. Members of the Board of Directors, or any committee thereof, may participate in a meeting of the Board of Directors or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.
SECTION 3.9. Quorum. Subject to Section 3.10 of these Bylaws, a whole number of directors equal to at least a majority of the directors then in office shall constitute a quorum for the transaction of business, provided that such directors represent at least one-third of the Whole Board. If at any meeting of the Board of Directors there shall be less than a quorum present, a majority of the directors present may adjourn the meeting from time to time without further notice. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless otherwise provided by the Certificate of Incorporation, these Bylaws or the DGCL. The directors present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough directors to leave less than a quorum.
SECTION 3.10. Vacancies. Subject to applicable law and the rights of the holders of any series of Preferred Stock with respect to such series of Preferred Stock, and unless the Board of Directors otherwise determines, vacancies resulting from death, resignation, retirement, disqualification, removal from office or other cause, and newly created directorships resulting from any increase in the authorized number of directors, may be filled only by the affirmative vote of a majority of the remaining directors, though less than a quorum of the Board of Directors, or by a sole remaining director, and each director so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of office of the class to which they have been appointed expires and until such director’s successor shall have been duly elected and qualified; provided that prior to the Expiration Date, the filling of vacancies shall also be subject to the applicable provisions of Article X of these Bylaws. No decrease in the number of authorized directors constituting the Whole Board shall shorten the term of any incumbent director.
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SECTION 3.11. Chair of the Board. Subject to the applicable provisions of Article X, the Board of Directors may appoint, by the affirmative vote of the majority of the directors then in office, a Chair of the Board of Directors (who may be an Executive Chair or the Chief Executive Officer) from among the directors. The Chair of the Board of Directors shall preside over all meetings of the Board of Directors and stockholders at which he or she is present. The Chair of the Board of Directors may also be an executive officer of the Corporation. If the Chair of the Board of Directors is an Executive Chair, the Executive Chair shall be an executive officer of the Corporation and shall perform such duties and possess such powers as are customarily vested in the office of the Chair of the Board of Directors of a corporation or as may be vested in him or her by the Board of Directors from time to time. The Executive Chair and Chief Executive Officer shall have joint responsibilities over the strategy, policy making, capital allocation and personnel matters of the Corporation. The Executive Chair shall have broad access to the records, management and personnel of the Corporation and its subsidiaries, including without limitation the power and authority to obtain any information about the Corporation and its operations. The Executive Chair is authorized to execute bonds, mortgages and other contracts requiring a seal, under the seal of the Corporation, except where required by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly and exclusively delegated by the Board of Directors to some other officer or agent of the Corporation. During the time of any vacancy in the office of Chief Executive Officer or in the event of the absence or disability of the Chief Executive Officer, the Executive Chair shall have the duties and powers of the Chief Executive Officer unless otherwise determined by the Board of Directors or otherwise specified herein. In no event shall any third party having dealings with the Corporation be bound to inquire as to any facts required by the terms of this Section 3.11 for the exercise by the Executive Chair of the powers of the Executive Chair.
SECTION 3.12. Committees. The Board of Directors may designate any such committee as the Board of Directors considers appropriate, which shall consist of one or more directors of the Corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Any such committee may to the extent permitted by law exercise such powers and shall have such responsibilities as shall be specified in the designating resolution. Each committee shall keep written minutes of its proceedings and shall report such proceedings to the Board of Directors as appropriate.
A majority of any committee may determine its action and fix the time and place of its meetings, unless the Board of Directors shall otherwise provide. Notice of such meetings shall be given to each member of the committee in the manner provided for in Section 3.6 of these Bylaws. The Board of Directors shall have power at any time to fill vacancies in, to change the membership of, or to dissolve, any such committee. Nothing herein shall be deemed to prevent the Board of Directors from appointing one or more committees consisting in whole or in part of persons who are not directors of the Corporation; provided, however, that no such committee shall have or may exercise any authority of the Board of Directors.
SECTION 3.13. Removal. Subject to any rights granted to the holders of shares of any series of Preferred Stock then outstanding and the applicable requirements of Article X of these Bylaws, any director may be removed at any time, either with or without cause, upon the affirmative vote of the holders of a majority of the outstanding shares of capital stock of the Corporation then entitled to vote in an election of such director.
SECTION 3.14. Records. The Board of Directors shall cause to be kept a record containing the minutes of the proceedings of the meetings of the Board and of the stockholders, appropriate stock books and registers and such books of records and accounts as may be necessary for the proper conduct of the business of the Corporation.
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ARTICLE IV
OFFICERS
SECTION 4.1. Elected Officers. The officers of the Corporation shall be appointed by the Board of Directors, or as otherwise provided in this Article IV, and shall include a Chief Executive Officer, a President, a Chief Financial Officer, a Secretary, and such other officers as the Board of Directors from time to time may deem proper, which may include an Executive Chair, one or more Vice Presidents (including, without limitation, Senior Vice Presidents) and a Treasurer. Any number of offices may be held by the same person. All officers appointed in accordance with these Bylaws shall each have such powers and duties as generally pertain to their respective offices, subject to the specific provisions of this Article IV. Such officers shall also have such powers and duties as from time to time may be conferred by the Board of Directors or by any committee thereof, or (subject to Article X) the Chief Executive Officer in the case of any Vice President, Senior Vice President or Treasurer appointed by the Chief Executive Officer pursuant to Section 4.3. The Board or any committee thereof may from time to time elect, or the Chief Executive Officer may appoint, such other officers (including one or more Assistant Vice Presidents, Assistant Secretaries, and Assistant Treasurers) and such agents, as may be necessary or desirable for the conduct of the business of the Corporation. Such other officers and agents shall have such duties and shall hold their offices for such terms as shall be provided in these Bylaws or as may be prescribed by the Board of Directors or such committee, or by the Chief Executive Officer, as the case may be. For the avoidance of doubt, such other officers and agents shall have the powers and perform the duties as are customarily incident to the position they hold.
SECTION 4.2. Term of Office. Each officer shall hold office until such officer’s successor shall have been duly appointed and shall have qualified or until such officer’s earlier death, resignation or removal.
SECTION 4.3. Chief Executive Officer. The Chief Executive Officer shall have the powers and perform the duties incident to that position. Subject to the powers of the Board of Directors and Section 3.11, he or she shall be in the general and active charge of the entire business and affairs of the Corporation and shall be its chief policy- making officer. The Chief Executive Officer shall report to the Executive Chair so long as there is an Executive Chair. The Chief Executive Officer is authorized to execute bonds, mortgages and other contracts requiring a seal, under the seal of the Corporation, except where required by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly and exclusively delegated by the Board of Directors to some other officer or agent of the Corporation. Subject to the authority of the Board of Directors, the Executive Chair and the provisions of the Certificate of Incorporation and these Bylaws, including Article X, the Chief Executive Officer is authorized to appoint one or more Vice Presidents (including, without limitation, Senior Vice Presidents) and/or a Treasurer. The Chief Executive Officer shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or as may be provided in these Bylaws. The Chief Executive Officer of the Corporation may also serve as President, if so appointed by the Board of Directors.
SECTION 4.4. President. The President of the Corporation shall have general charge of the business, affairs and property of the Corporation, and control over its officers, agents and employees; and shall see that all orders and resolutions of the Board of Directors, the Executive Chair and the Chief Executive Officer are carried into effect. The President shall, in the absence or disability of the Chief Executive Officer and the Executive Chair, act with all of the powers and be subject to all the restrictions of the Chief Executive Officer. The President is authorized to execute bonds, mortgages and other contracts requiring a seal, under the seal of the Corporation, except where required by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly and exclusively delegated by the Board of Directors to some other officer or agent of the Corporation. The President shall have such other powers and perform such other duties as may be prescribed by the Executive Chair, Chief Executive Officer or the Board of Directors or as may be provided in these Bylaws.
SECTION 4.5. Chief Financial Officer. The Chief Financial Officer shall act in an executive financial capacity. The Chief Financial Officer shall assist the Executive Chair, the Chief Executive Officer and the President in the general supervision of the Corporation’s financial policies and affairs.
SECTION 4.6. Secretary. The Secretary shall keep or cause to be kept in one or more books provided for that purpose, the minutes of all meetings of the Board of Directors, the committees of the Board of Directors and the stockholders; the Secretary shall see that all notices are duly given in accordance with the provisions of these Bylaws and as required by applicable law; the Secretary shall be custodian of the records and the seal of the Corporation and affix and attest the seal to all stock certificates of the Corporation (unless the seal of the Corporation on such certificates shall be a facsimile, as hereinafter provided) and affix and attest the seal to all other documents to be executed on behalf of the Corporation under its seal; and the Secretary shall see that the books, reports, statements, certificates and other documents and records required by applicable law to be kept and filed are properly kept and filed; and in general, the Secretary shall perform all the duties incident to the office of Secretary and such other duties as from time to time may be assigned to such Secretary by the Board of Directors, the Executive Chair, the Chief Executive Officer or the President.
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SECTION 4.7. Vice Presidents. Any Vice President shall have such powers and shall perform such duties as shall be assigned to such Vice President by the Board of Directors, the Executive Chair, the Chief Executive Officer or the President.
SECTION 4.8. Treasurer. Any Treasurer shall exercise general supervision over the receipt, custody and disbursement of corporate funds, shall cause the funds of the Corporation to be deposited in such banks as may be authorized by the Board of Directors, or in such banks as may be designated as depositaries in the manner provided by resolution of the Board of Directors, and shall have such further powers and duties as shall be prescribed from time to time by the Board of Directors, the Executive Chair, the Chief Executive Officer or the President.
SECTION 4.9. Removal. Any officer or agent appointed by the Board of Directors may be removed from office at any time with or without cause by the affirmative vote of a majority of the Board of Directors then in office. Subject to Article X, any officer or agent appointed by the Chief Executive Officer may be removed by the Chief Executive Officer at any time with or without cause. No elected officer shall have any contractual rights against the Corporation for compensation by virtue of such election beyond the date of the election of his or her successor, his or her death, or his or her resignation or removal, whichever event shall first occur, except as otherwise provided in an employment contract or under an employee deferred compensation plan.
SECTION 4.10. Vacancies. Subject to Article X, a newly created elected office and a vacancy in any elected office because of death, resignation, or removal may be filled by the Board of Directors. Subject to Article X, any vacancy in an office appointed by the Chief Executive Officer because of death, resignation, or removal may be filled by the Chief Executive Officer.
ARTICLE V
STOCK CERTIFICATES AND TRANSFERS
SECTION 5.1. Form. Shares of stock of the Corporation shall be represented by certificates, provided that the Board of Directors may provide by resolution that some or all of any or all classes or series of stock shall be uncertificated. Any such resolution shall not apply to shares represented by a certificate until such certificate is presented to the Corporation. If any shares of stock of the Corporation are represented by a certificate, every holder of stock in the Corporation represented by a certificate shall be entitled to have the certificate signed by, or in the name of, the Corporation by any two authorized officers of the Corporation representing the number of shares registered in certificate form. If the Board of Directors shall direct that any shares of stock of the Corporation shall be represented by certificates, the Chair of the Board, the Chief Executive Officer, the President, any Vice President, the Treasurer, if any, any Assistant Treasurer, the Corporate Secretary, any Assistant Corporate Secretary and any other officer designated by the Board of Directors shall be deemed to be authorized for purposes of this Section 5.1 to sign certificates representing shares of the Corporation’s capital stock. Any or all of the signatures on any certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed, or whose facsimile signature or signatures have been placed on, any such certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, such certificate may nevertheless be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.
SECTION 5.2. Transfers. Stock of the Corporation shall be transferable in the manner prescribed by law and in these Bylaws. In the case of any shares represented by certificates, transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by his, her or its attorney lawfully constituted in writing and upon the surrender of the certificate therefor, which shall be canceled before a new certificate shall be issued. Upon the receipt of proper transfer instructions from the registered owner of uncertificated shares, such uncertificated shares shall be cancelled, issuance of new equivalent uncertificated shares shall be made to the stockholder entitled thereto and the transaction shall be recorded upon the books of the Corporation. If the Corporation has a transfer agent or registrar acting on its behalf, the signature of any officer or representative thereof may be in facsimile. The Board of Directors or the Chief Executive Officer may appoint a transfer agent and one or more co-transfer agents and registrar and one or more co-registrars and may make or authorize such agent to make all such rules and regulations deemed expedient concerning the issue, transfer and registration of shares of the Corporation’s capital stock.
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SECTION 5.3. Lost, Stolen or Destroyed Certificates. The Corporation may issue a new certificate or certificates or uncertificated shares in place of any certificate or certificates previously issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate to be lost, stolen, or destroyed. When authorizing such issue of a new certificate or certificates or uncertificated shares, the Corporation may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen, or destroyed certificate or certificates, or his or her legal representative, to give the Corporation a bond sufficient to indemnify the Corporation against any claim that may be made against the Corporation on account of the loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.
SECTION 5.4. Fixing a Record Date for Stockholder Meetings. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty (60) days nor less than ten (10) days before the date of such meeting. If the Board of Directors so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board of Directors determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the next day preceding the day on which notice is first given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting; and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance herewith at the adjourned meeting.
SECTION 5.5. Fixing a Record Date for Other Purposes. In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment or any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of capital stock, or for the purposes of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.
SECTION 5.6. Registered Stockholders. The Corporation may treat the registered owner of any shares of its stock as the person entitled to receive dividends, to vote, to receive notifications, and otherwise to exercise all the rights and powers of an owner. The Corporation shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof.
ARTICLE VI
INDEMNIFICATION
SECTION 6.1. Indemnification.
(A) Each person who was or is a party to, or is otherwise threatened to be made a party to or is otherwise involved (including involvement as a witness) in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “Proceeding”), by reason of the fact that he or she or a person of whom he or she is the legal representative is or was, at any time during which this Bylaw is in effect (whether or not such person continues to serve in such capacity at the time any indemnification or advancement of expenses pursuant hereto is sought or at the time any Proceeding relating thereto exists or is
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brought), a director or officer of the Corporation or, while serving as a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, employee or agent of another corporation, or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans maintained or sponsored by the Corporation (each such director or officer, a “Covered Person”), whether the basis of such Proceeding is alleged action in an official capacity as a director, officer, trustee, employee or agent or in any other capacity while serving as a director, officer, trustee, employee or agent, shall be (and shall be deemed to have a contractual right to be) indemnified and held harmless by the Corporation (and any successor of the Corporation by merger or otherwise) to the fullest extent permitted by the DGCL as the same exists or may hereafter be amended or modified from time to time (but, in the case of any such amendment or modification, only to the extent that such amendment or modification permits the Corporation to provide greater indemnification rights than the DGCL permitted the Corporation to provide prior to such amendment or modification), against all expenses, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) actually and reasonably incurred or suffered by such person in connection with such Proceeding if the person acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful; provided, however, that, except as provided in Section 6.3, the Corporation shall indemnify any such Covered Person seeking indemnification in connection with a Proceeding (or part thereof) initiated by such Covered Person only if such Proceeding (or part thereof) was authorized by the Board of Directors of the Corporation. The termination of any Proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the person’s conduct was unlawful.
(B) To obtain indemnification under this Article VI, a Covered Person shall submit to the Corporation a written request, including therein or therewith such documentation and information as is reasonably available to the Covered Person and as is reasonably necessary to determine whether and to what extent the Covered Person is entitled to indemnification. Upon written request by a Covered Person for indemnification pursuant to the first sentence of this Section 6.1(B), a determination, if required by applicable law, with respect to the Covered Person’s entitlement thereto shall be made in the specific case (i) if a Change of Control (as defined in the Corporation’s current equity compensation plan) shall have occurred, by Independent Counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to the Covered Person, or (ii) if a Change in Control shall not have occurred, (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors, (B) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors, (C) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to the Covered Person, or (D) if so directed by the Board of Directors, by the stockholders of the Corporation. In the event the determination of entitlement to indemnification is to be made by Independent Counsel, the Independent Counsel shall be selected by (i) the Board of Directors if a Change of Control shall not have occurred or (ii) by the Covered Person if a Change of Control shall have occurred, unless the Covered Person shall request that such selection be made by the Board of Directors. If it is so determined that the Covered Person is entitled to indemnification, payment to the Covered Person shall be made within 10 days after such determination.
(C) To the extent that a Covered Person is a party to or a participant in and is successful (on the merits or otherwise) in defense of any action, suit or proceeding, the Corporation shall indemnify the Covered Person against all expenses actually and reasonably incurred by the Covered Person or on the Covered Person’s behalf in connection therewith. To the extent permitted by applicable law, if the Covered Person is not wholly successful in such action, suit or proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such action, suit or proceeding, the Corporation shall indemnify the Covered Person to the fullest extent permitted by applicable law against all expenses actually and reasonably incurred by the Covered Person or on the Covered Person’s behalf in connection with or related to each successfully resolved claim, issue or matter.
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SECTION 6.2. Advance of Expenses. To the fullest extent permitted by the DGCL as the same exists or may hereafter be amended or modified from time to time (but, in the case of any such amendment or modification, only to the extent that such amendment or modification permits the Corporation to provide greater rights to advancement of expenses than the DGCL permitted the Corporation to provide prior to such amendment or modification), each Covered Person shall have (and shall be deemed to have a contractual right to have) the right, without the need for any action by the Board of Directors, to be paid by the Corporation (and any successor of the Corporation by merger or otherwise) the expenses incurred in connection with any Proceeding in advance of its final disposition, such advances to be paid by the Corporation within twenty (20) days after the receipt by the Corporation of a statement or statements from the claimant requesting such advance or advances from time to time; provided, that if the DGCL requires, the payment of such expenses incurred by a director or officer in his or her capacity as a director or officer (and not, except to the extent specifically required by applicable law, in any other capacity in which service was or is rendered by such person while a director or officer, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter, the “Undertaking”) by or on behalf of such director or officer, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right of appeal (a “final disposition”) that such director or officer is not entitled to be indemnified for such expenses under this Bylaw or otherwise.
SECTION 6.3. Claims. If a determination by the Corporation that the Covered Person is entitled to indemnification pursuant to this Article VI is required, and the Corporation fails to respond within sixty (60) days to a written request for indemnification, the Corporation shall be deemed to have approved the request. If the Corporation denies a written request for indemnification or advance of expenses to a Covered Person, in whole or in part, or if payment in full pursuant to such request is not made within forty-five (45) days after a written claim submitted pursuant to Section 6.1(b) of these Bylaws (or, in the case of an advance of expenses, twenty (20) days after provision of a statement pursuant to Section 6.2 of these Bylaws and any required Undertaking), the right to indemnification or advances as granted by this Article VI shall be enforceable by such Covered Person in any court of competent jurisdiction. Such Covered Person’s costs and expenses incurred in connection with successfully establishing his or her right to indemnification, in whole or in part, in any such action shall also be indemnified by the Corporation. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of expenses where the Undertaking, if required by the DGCL, has been tendered to the Corporation) that the Covered Person has not met the standards of conduct which make it permissible under the DGCL for the Corporation to indemnify the Covered Person for the amount claimed, but the burden of such defense shall be on the Corporation. Neither the failure of the Corporation (including by its Board of Directors, Independent Counsel or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the Covered Person is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including by its Board of Directors, Independent Counsel or its stockholders) that the Covered Person has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the Covered Person has not met the applicable standard of conduct.
SECTION 6.4. Non-Exclusivity of Rights. The rights conferred on any person in this Article VI, shall not be exclusive of any other right that such person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, Bylaws, agreement, vote or consent of stockholders or the Board of Directors. In addition, nothing in this Article VI shall limit the ability of the Corporation, in its discretion, to indemnify or advance expenses to persons whom the Corporation is not obligated to indemnify or advance expenses pursuant to this Article VI. The Board of Directors shall have the power to delegate to such officer or other person as the Board of Directors shall specify the determination of whether indemnification shall be given to any person pursuant to this Section 6.4.
SECTION 6.5. Insurance. The Corporation may purchase and maintain insurance on its own behalf and on behalf of any person who is or was a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss asserted against him or her and incurred by him or her in any such capacity, whether or not the Corporation would have the power to indemnify such person against such expenses, liability or loss under the DGCL.
SECTION 6.6. Indemnification Contracts. The Board of Directors is authorized to cause the Corporation to enter into indemnification contracts with any director, officer, employee or agent of the Corporation, or any person serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, including employee benefit plans, providing indemnification rights to such person. Such rights may be greater than those provided in this Article VI.
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SECTION 6.7. Continuation of Indemnification. The rights to indemnification and to advancement of expenses provided by, or granted pursuant to, this Article VI shall continue notwithstanding that the person has ceased to be a Covered Person and shall inure to the benefit of his or her estate, heirs, executors, administrators, legatees and distributees; provided, however, that, except as set forth in Section 6.3, the Corporation shall indemnify any such person seeking indemnity in connection with a Proceeding (or part thereof) initiated by such person only if such Proceeding (or part thereof) was authorized by the Board of Directors.
SECTION 6.8. Effect of Amendment or Repeal. The provisions of this Article VI shall constitute a contract between the Corporation, on the one hand, and, on the other hand, each individual who serves or has served as a Covered Person (whether before or after the adoption of these Bylaws), in consideration of such person’s performance of such services, and pursuant to this Article VI, the Corporation intends to be legally bound to each such current or former Covered Person. With respect to current and former Covered Persons, the rights conferred under this Article VI are present contractual rights and such rights are fully vested, and shall be deemed to have vested fully, immediately upon adoption of these Bylaws. With respect to any Covered Persons who commence service following adoption of these Bylaws, the rights conferred under this Article VI shall be present contractual rights, and such rights shall fully vest, and be deemed to have vested fully, immediately upon such Covered Person’s service in the capacity which is subject to the benefits of this Article VI.
SECTION 6.9. Notice. Any notice, request or other communication required or permitted to be given to the Corporation under this Article VI shall be in writing and either delivered in person or sent by telecopy, overnight mail or courier service, or certified or registered mail, postage prepaid, return receipt requested, to the Secretary of the Corporation and shall be effective only upon receipt by the Secretary.
SECTION 6.10. Severability. If any provision or provisions of this Article VI shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (1) the validity, legality and enforceability of the remaining provisions of this Article VI (including, without limitation, each portion of any paragraph of this Article VI containing any such provision held to be invalid, illegal or unenforceable, that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (2) to the fullest extent possible, the provisions of this Article VI (including, without limitation, each such portion of any paragraph of this Article VI containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.
SECTION 6.11. Definitions. For purposes of this Article VI:
(A) “Disinterested Director” means a director of the Corporation who is not and was not a party to the matter in respect of which indemnification is sought by the Covered Person;
(B) “Independent Counsel” means a law firm, a member of a law firm, or an independent practitioner, that is experienced in matters of corporation law and shall include any person who, under the applicable standards of professional conduct then prevailing, would not have a conflict of interest in representing either the Corporation or the Covered Person in an action to determine the Covered Person’s rights under this Article VI.
ARTICLE VII
MISCELLANEOUS PROVISIONS
SECTION 7.1. Fiscal Year. The fiscal year of the Corporation shall begin on the first (1st) day of January and end on the thirty-first (31st) day of December of each year. The Board of Directors shall have the power, from time to time, to fix the fiscal year of the Corporation by a duly adopted resolution.
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SECTION 7.2. Dividends. The Board of Directors may from time to time declare, and the Corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and the Certificate of Incorporation.
SECTION 7.3. Seal. The corporate seal, if the Corporation shall have a corporate seal, shall have inscribed thereon the words “Corporate Seal, Delaware,” the name of the Corporation and the year of its organization. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.
SECTION 7.4. Waiver of Notice. Whenever any notice is required to be given to any stockholder or director of the Corporation under the provisions of the DGCL, the Certificate of Incorporation or these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to such notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Neither the business to be transacted at, nor the purpose of, any annual or special meeting of the stockholders or the Board of Directors or committee thereof need be specified in any waiver of notice of such meeting.
SECTION 7.5. Resignations. Any director or any officer, whether elected or appointed, may resign at any time by giving written notice of such resignation to the Chair of the Board of Directors, the Chief Executive Officer, or the Secretary, and such resignation shall be deemed to be effective as of the close of business on the date said notice is received by the Chair of the Board of Directors, the Chief Executive Officer, or the Secretary, or at such later time as is specified therein. Except to the extent specified in such notice, no formal action shall be required of the Board of Directors or the stockholders to make any such resignation effective.
ARTICLE VIII
CONTRACTS, PROXIES, ETC.
SECTION 8.1. Contracts. In addition to the powers otherwise granted to officers pursuant to Article IV hereof, the Board of Directors or Chief Executive Officer may authorize any officer or officers, or any agent or agents, of the Corporation to enter into any contract or to execute and deliver any instrument in the name of and on behalf of the Corporation, and such authority may be general or confined to specific instances. Without limiting the foregoing, unless otherwise provided by resolution adopted by the Board of Directors, the Chief Executive Officer, the President, the Secretary and the Treasurer may enter into any contract or execute and deliver any instrument in the name and on behalf of the Corporation.
SECTION 8.2. Proxies. Unless otherwise provided by resolution adopted by the Board of Directors, the Chief Executive Officer, the President or any other officer delegated such power by the Board of Directors may from time to time appoint an attorney or attorneys or agent or agents of the Corporation, in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as the holder of stock or other securities in any other corporation, any of whose stock or other securities may be held by the Corporation, at meetings of the holders of the stock or other securities of such other corporation, or to consent in writing, in the name of the Corporation as such holder, to any action by such other corporation, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, all such written proxies or other instruments as he or she may deem necessary or proper in the premises. Any stockholder directly or indirectly soliciting proxies from other stockholders must use a proxy card color other than white, which shall be reserved for the exclusive use by the Board of Directors.
ARTICLE IX
AMENDMENTS
Unless otherwise provided by the Certificate of Incorporation, the Board of Directors shall have the power without the assent or vote of the stockholders to adopt, amend, alter or repeal these Bylaws. Unless otherwise provided by the Certificate of Incorporation, the stockholders shall have the power to adopt, amend, alter or repeal these Bylaws by an affirmative vote of shares representing a majority of the voting power of all the outstanding shares of capital stock of the Corporation entitled to vote thereon, voting together as a single class.
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ARTICLE X
CERTAIN CORPORATE GOVERNANCE MATTERS
SECTION 10.1. Executive Chair; President and CEO. Effective as of the Effective Time (for all purposes of this Article X, as defined in the Agreement and Plan of Merger, dated as of August 20, 2024, by and among the Corporation, Mountain Range Merger Sub Inc., a Delaware corporation and Arch Resources, Inc., a Delaware corporation (“Arch”), as the same may be amended from time to time (the “Merger Agreement”)), (a) James A. Brock shall serve as the Executive Chair of the Board of Directors and (b)Paul A. Lang shall serve as the Chief Executive Officer of the Corporation and as a member of the Board of Directors. The initial term of James A. Brock as Executive Chair of the Board of Directors shall expire effective as of the earlier of (i) the two-year anniversary of the Effective Time (the “Expiration Date”) or (ii) any date as of which James A. Brock ceases to serve as a member of the Board of Directors for any reason in accordance with these Bylaws (such date, the “Chairman Succession Date”). James A. Brock’s service as a member of the Board of Directors need not cease upon the cessation of his term as Executive Chair of the Board of Directors pursuant to clause (i) of the immediately preceding sentence. From and after the Chairman Succession Date, the Board of Directors shall select a member of the Board of Directors (which may be James A. Brock if still a member of the Board of Directors) to serve as Chair or Executive Chair of the Board of Directors. The Executive Chair may voluntarily resign from his or her position at any time. The initial term of Paul A. Lang as Chief Executive Officer of the Corporation shall expire no earlier than the two-year anniversary of the Effective Time other than in the case of (and limited to) (1) the Chief Executive Officer’s resignation or death prior to such date or (2) the Chief Executive Officer’s removal from such office by the Board of Directors in accordance with the applicable requirements of Article X of these Bylaws.
SECTION 10.2. Board Size and Composition. Effective as of the Effective Time, the Board of Directors shall be comprised of four Continuing CONSOL Directors (as defined below), including James A. Brock, and four Continuing Arch Directors (as defined below), including Paul A. Lang and Richard A. Navarre. From and after the Effective Time until the Expiration Date: (i) the number of directors that comprises the full Board of Directors shall be eight; (ii) any Continuing CONSOL Director and any Continuing Arch Director who is then serving as a member of the Board of Directors and whose term is expiring at an annual meeting of shareholders held on a date that is prior to the Expiration Date shall be nominated by the Board of Directors for election to the Board of Directors at such annual meeting, subject to applicable stock exchange, legal and other applicable requirements, in each case provided that if the Continuing CONSOL Director or Continuing Arch Director, as applicable, was an independent director of the Corporation, such individual continues to be an independent director of the Corporation, and unless such Continuing CONSOL Director or Continuing Arch Director, as applicable, notifies the Board of Directors of his or her desire not to be so nominated; (iii) no vacancy on the Board created by the cessation of service of a director shall be filled by the Board of Directors, and the Board of Directors shall not appoint or nominate any individual to fill such vacancy, unless (x) if the predecessor director leading to the creation of such vacancy was an independent director of the Corporation, such individual would be an independent director of the Corporation, (y) in the case of a vacancy created by the cessation of service of a Continuing CONSOL Director, not less than a majority of the Continuing CONSOL Directors have approved the appointment or nomination (as applicable) of the individual appointed or nominated (as applicable) to fill such vacancy, and (z) in the case of a vacancy created by the cessation of service of a Continuing Arch Director, not less than a majority of the Continuing Arch Directors have approved the appointment or nomination (as applicable) of the individual appointed or nominated (as applicable) to fill such vacancy; provided, that any such appointment or nomination pursuant to clause (y) or (z) shall be made in accordance with applicable Law and the rules of the New York Stock Exchange (or other national securities exchange on which the Corporation’s securities are then listed). For purposes of this Article X, the term “Continuing CONSOL Directors” shall mean the directors of the Corporation who were designated by the Corporation to be directors of the Corporation as of the Effective Time pursuant to Section 2.7(a) of the Merger Agreement, and any directors of the Corporation who were subsequently appointed or nominated and elected to fill a vacancy created by the cessation of service of any such director (or any successor thereto) pursuant to clause (y) of the second sentence of this Section 10.2, and the term “Continuing Arch Directors” shall mean the directors of Arch who were designated by Arch to be directors of the Corporation as of the Effective Time pursuant to Section 2.7(a) of the Merger Agreement, and any directors of the Corporation who were subsequently appointed or nominated and elected to fill a vacancy created by the cessation of service of any such director (or any successor thereto) pursuant to clause (z) of the second sentence of this Section 10.2.
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SECTION 10.3. Lead Independent Director. From the Effective Time through the Chairman Succession Date, or any subsequent time when the Chair of the Board of Directors is not an independent director, the Board of Directors shall have a lead independent director who shall be elected by a majority of the members of the Board of Directors. The initial lead independent director of the Board of Directors shall be Richard A. Navarre.
Section 10.4. Officer Appointment and Removal. While the Corporation has an Executive Chair, the consent of both the Executive Chair and the Chief Executive Officer shall be required for the appointment or removal of any officer with a position of Senior Vice President or above. In the event the Chief Executive Officer and Executive Chair are unable to agree, such decision shall be made instead by the Board of Directors; provided however, that if such disagreement occurs prior to the Expiration Date, then such decision shall be made by the affirmative vote of at least 75% of the directors then in office.
SECTION 10.5. Certain Actions; Amendments; Interpretation. The following actions shall require the affirmative vote of at least 75% of the Whole Board (rounded to the nearest whole number): (i) prior to the Expiration Date, the removal of James A. Brock from his position as the Executive Chair of the Board of Directors, or any diminution in or modification of the duties of the Executive Chair of the Board of Directors or the other matters set forth in Section 3.11 of these Bylaws, or any election or appointment of a replacement Chair or Executive Chair of the Board of Directors (including to fill a vacancy in any such position); (ii) prior to the Expiration Date, the failure to appoint or re-nominate James A. Brock or Paul A. Lang as a member of the Board of Directors; (iii) prior to the Expiration Date, the removal of Paul A. Lang from his position as the Chief Executive Officer of the Corporation, or any diminution in or modification of the duties of the Chief Executive Officer set forth in Section 4.3 of these Bylaws or the other matters set forth in Section 3.11 of these Bylaws, or any election or appointment of a replacement Chief Executive Officer (including to fill a vacancy in any such position); and (iv) prior to the Expiration Date, any change in the size or composition of the Board of Directors as set forth in Section 10.2 of these Bylaws. Effective as of the Effective Time until the Expiration Date, the provisions of this Article X may be modified, amended or repealed, and any bylaw provision or other resolution (including any proposed corresponding modification, amendment or repeal of any provision of the Corporation’s other constituent documents) inconsistent with this Article X may be adopted, only by (and any such modification, amendment, repeal or inconsistent bylaw provision or other resolution may be proposed or recommended by the Board of Directors only by) the affirmative vote of at least 75% of the Whole Board (rounded to the nearest whole number). In the event that the size of the Board of Directors is increased, then any provision in Section 10.4 or this Section 10.5 which requires the approval of a specific number of directors will be deemed amended to adjust such requirement proportionately so that 75% of the Whole Board (rounded to the nearest whole number) is required for any such approval. In the event of any inconsistency between any provision of this Article X and any other provision of these Bylaws, including Article III or Article IX of these Bylaws, the provisions of this Article X shall control to the fullest extent permitted by law.
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Exhibit 10.1
Execution Version
AMENDMENT NO. 6
This AMENDMENT NO. 6, dated as of January 14, 2025 (this “Amendment”), amends the Credit Agreement, dated as of November 28, 2017 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”), by and among CORE NATURAL RESOURCES, INC. (f/k/a CONSOL ENERGY INC.) (the “Borrower”), the guarantors party thereto, the lenders and agents party thereto and PNC Bank, National Association, as administrative agent (the “Administrative Agent”). Capitalized terms used but not defined herein shall have the meanings given them in the Credit Agreement as amended by this Amendment (the “Amended Credit Agreement”).
WITNESSETH
WHEREAS, on August 20, 2024, the Borrower entered into an agreement and plan of merger with Mountain Range Merger Sub Inc. and Arch Resources, Inc. (“Arch”), which provides for the combination of the Borrower and Arch in an all-stock merger of equals transaction (the “Merger”).
WHEREAS, the Merger shall be consummated substantially concurrently with this Amendment and in connection therewith Arch shall become a wholly owned subsidiary of Borrower and the Borrower shall be renamed from CONSOL Energy Inc. to Core Natural Resources, Inc.;
WHEREAS, in connection with the Merger, the Borrower desires to amend the Credit Agreement on the terms set forth herein;
WHEREAS, the consents of the Lenders are required for certain amendments to the Credit Agreement set forth herein;
WHEREAS, the Borrower, the Loan Parties and the Administrative Agent entered into that certain Security Agreement, dated as of November 28, 2017 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Security Agreement”);
WHEREAS, the Borrower, the Administrative Agent and the Lenders party hereto, which constitute the Required Lenders, desire to amend and restate the Security Agreement on the terms set forth herein;
WHEREAS, PNC Capital Markets LLC, Axos Bank, Burke & Herbert Bank, Dollar Bank, Federal Savings Bank, EverBank, N.A., First National Bank of Pennsylvania, KeyBank National Association, Manufacturers and Traders Trust Company, Northwest Bank and Regions Capital Markets, a division of Regions Bank, are acting as joint lead arrangers and joint bookrunners for this Amendment.
NOW, THEREFORE, the parties hereto, in consideration of the mutual covenants and agreements herein contained and intending to be legally bound hereby, covenant and agree as follows:
1. Amendments to the Credit Agreement and Loan Documents.
(a) Effective as of the Amendment No. 6 Effective Date (as defined below):
(i) the Credit Agreement is hereby amended to be as set forth in the conformed copy of the Credit Agreement as amended by this Amendment attached as Exhibit A hereto;
(ii) Schedule I attached hereto hereby amends and restates each of the Schedules attached to the Credit Agreement, including Schedule 1.1(B) attached to the Credit Agreement (as so amended, the “Amended Commitment Schedule”);
(iii) Exhibit B attached hereto hereby amends and restates Exhibit 2.5.1 attached to the Credit Agreement;
(iv) Exhibit C attached hereto hereby amends and restates Exhibit 2.5.2 attached to the Credit Agreement;
(v) Exhibit D-1, D-2, D-3 and D-4 attached hereto hereby amend and restate Exhibits 5.9.5-1, 5.9.5-2, 5.9.5-3 and 5.9.5-4, respectively attached to the Credit Agreement;
(vi) Exhibit E attached hereto hereby amends and restates Exhibit 8.2.6 attached to the Credit Agreement; and
(vii) Exhibit F attached hereto hereby amends and restates Exhibit 8.3.4 attached to the Credit Agreement.
(viii) Exhibits G-1 and G-2 hereto hereby amend and restate Exhibits 1.1(P)(1) and 1.1(P)(2), respectively attached to the Credit Agreement.
(b) Each Revolving Lender, by execution of this Amendment, agrees that, upon effectiveness of this Amendment, its Revolving Credit Commitment is as set forth on the Amended Commitment Schedule. Any Revolving Lender that was not a Revolving Lender immediately prior to the Amendment No. 6 Effective Date (any such Revolving Lender, a “New Revolving Lender”) hereby agrees to become a Revolving Lender for all purposes under the Amended Credit Agreement and the other Loans Documents. Each New Revolving Lender, and if any existing Revolving Lender’s Revolving Credit Commitment as set forth on the Amended Commitment Schedule is higher than such Revolving Lender’s Revolving Credit Commitment immediately prior to the effectiveness of this Amendment (any such Revolving Lenders, an “Increasing Revolving Lender” and the amount of such increase in the Revolving Credit Commitments for any such Increasing Revolving Lender, the “Increased Commitment”), each such Increasing Revolving Lender agrees, subject to the terms and conditions set forth in Section 2 of this Amendment, to fund such amounts to the Administrative Agent to the extent necessary so that its Revolving Credit Loans and Participation Advances have been funded by such Revolving Lender in accordance with its Ratable Share and to acquire participations in Letters of Credit and Swing Loans so that such Revolving Lender’s participations therein are in accordance with its Ratable Share. Any such amounts received by the Administrative Agent shall be disbursed to Revolving Lenders whose Revolving Credit Commitment is unchanged, so that after such fundings and disbursements the Revolving Credit Loans and Participation Advances have been funded in accordance with each Revolving Lender’s Ratable Share. Each Revolving Lender, by execution of this Amendment, consents in its capacity as Issuing Lender to this Amendment, including changes to the Revolving Credit Commitments as set forth on the Amended Commitment Schedule.
(c) The Borrower, the Administrative Agent and the Lenders party hereto consent to the amendment and restatement of the Security Agreement in the form attached as Exhibit H hereto.
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2. Conditions Precedent. This Amendment shall be effective upon satisfaction of each of the following conditions (the date of such effectiveness, the “Amendment No. 6 Effective Date”):
(a) Execution and Delivery of Amendment. The Borrower, the Guarantors, the Administrative Agent, the New Revolving Lenders, the Increasing Revolving Lenders, the other Lenders (together with the Increasing Revolving Lenders, constituting the Lenders (immediately prior to the Amendment No. 6 Effective Date)) and the Issuing Lenders shall have executed and delivered this Amendment.
(b) Officer’s Certificate.
1. (i) The representations and warranties of each of the Loan Parties contained in the Loan Documents shall be true and correct in all material respects on and as of the Amendment No. 6 Effective Date with the same effect as though such representations and warranties had been made on and as of such date (except (x) that any representation and warranty that is already qualified as to materiality shall be true and correct in all respects as so qualified and (y) representations and warranties which relate solely to an earlier date or time, which representations and warranties shall be true and correct on and as of the specific dates or times referred to therein); (ii) no Event of Default or Potential Default shall have occurred and be continuing; (iii) since December 31, 2023, there shall not have occurred any event or condition that has had or could be reasonably expected, either individually or in the aggregate, to constitute a Material Adverse Change; (iv) after giving effect to this Amendment, the aggregate amount of Indebtedness under the Credit Agreement shall not exceed the Applicable Other Indebtedness Cap; (v) the conditions set forth in Section 7.2 of the Credit Agreement shall be satisfied and (vi) the Borrower shall have delivered to the Administrative Agent for the benefit of each Lender a certificate of the Borrower, dated the Amendment No. 6 Effective Date and signed by a Responsible Officer or Authorized Officer of the Borrower, to each effect in clauses (i) through (v).
2. Pursuant to Section 5.03(a) of the Junior Lien Intercreditor Agreement, the Borrower shall have delivered to the Administrative Agent for the benefit of each Lender a certificate of the Borrower, dated the Amendment No. 6 Effective Date and signed by a Responsible Officer or Authorized Officer of the Borrower stating that this Amendment does not contravene any Secured Debt Document (as defined in the Intercreditor Agreement).
(c) Secretary’s Certificates. The Administrative Agent shall have received:
1. a certificate dated the Amendment No. 6 Effective Date and signed by an Authorized Officer of the Borrower, certifying (A) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of the Borrower authorizing the execution, delivery and performance of this Amendment and the other Loan Documents to be executed and delivered in connection herewith, and that such resolutions have not been modified, rescinded or amended and are in full force and effect on the Amendment No. 6 Effective Date; (B) the names of the officer or officers authorized to sign this Amendment and the other Loan Documents to be executed and delivered in connection herewith and the true signatures of such officer or officers and specifying the Authorized Officers permitted to act on behalf of the Borrower for purposes of this Amendment and such other Loan Documents and the true signatures of such officers, on which the Administrative Agent and each Lender party hereto may conclusively rely; and (C) copies of its certificate of incorporation (recently certified by the Secretary of State of the State of Delaware) and bylaws as in effect on the Amendment No. 6 Effective Date, together with recently dated certificates from the Secretary of State of the State of Delaware as to the continued existence and good standing of the Borrower; and
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2. a certificate dated the Amendment No. 6 Effective Date and signed by an Authorized Officer of each of the Loan Parties (other than the Borrower), certifying (A) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of such Loan Party (or its managing general partner, managing member or equivalent) authorizing the execution, delivery and performance of this Amendment and the other Loan Documents to be executed and delivered in connection herewith, and that such resolutions have not been modified, rescinded or amended and are in full force and effect on the Amendment No. 6 Effective Date; (B) the names of the officer or officers authorized to sign this Amendment and the other Loan Documents to be executed and delivered in connection herewith and the true signatures of such officer or officers and specifying the Authorized Officers permitted to act on behalf of such Loan Party for purposes of this Amendment and such other Loan Documents and the true signatures of such officers, on which the Administrative Agent and each Lender party hereto may conclusively rely; and (C) copies of its organizational documents, including its certificate of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation, and limited liability company agreement as in effect on the Amendment No. 6 Effective Date, recently certified by the appropriate state official where such documents are filed in a state office (or, in the alternative, certifying that such organizational documents have not been amended since the latest delivery of such organizational documents pursuant to Section 7.1.1(b)(iii) of the Credit Agreement or pursuant to a condition precedent to effectiveness of an amendment to the Credit Agreement, and that such organizational documents are in full force and effect), together with recently dated certificates from the appropriate state officials as to the continued existence and good standing of such Loan Party in each state where organized.
(d) Opinions of Counsel. The Administrative Agent shall have received:
1. A written opinion of counsel covering corporate matters under the laws of Delaware, who shall be selected by the Loan Parties and reasonably acceptable to the Administrative Agent, dated the Amendment No. 6 Effective Date, addressed to the Administrative Agent and the Lenders party hereto, substantially in the form agreed with the Administrative Agent prior to the Amendment No. 6 Effective Date.
2. A written opinion of Latham & Watkins LLP, counsel to the Loan Parties (who may rely on the opinions of such other counsel as may be acceptable to the Administrative Agent), dated the Amendment No. 6 Effective Date, addressed to the Administrative Agent and the Lenders party hereto, substantially in the form agreed with the Administrative Agent prior to the Amendment No. 6 Effective Date.
3. Written opinions of counsel covering corporate matters under the laws of Pennsylvania, Virginia and West Virginia, who shall be selected by the Loan Parties and reasonably acceptable to the Administrative Agent, dated the Amendment No. 6 Effective Date, addressed to the Administrative Agent and the Lenders party hereto, substantially in the form agreed with the Administrative Agent prior to the Amendment No. 6 Effective Date.
(e) Lien Searches. The Collateral Agent shall have received bring-down lien searches with a scope substantially similar to those delivered on the Closing Date, and shall be satisfied with the results thereof.
(f) Upfront Fee. The Borrower shall have paid to the Administrative Agent, for the account of each New Revolving Lender and each Increasing Lender, an upfront fee in the amount separately communicated to the Lenders of such New Revolving Lender’s and Increasing Lender’s, as the case may be, Revolving Credit Commitment and Increased Commitment, respectively.
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(g) Promissory Notes. The Borrower shall deliver, substantially concurrently with the effectiveness of this Amendment, to the Administrative Agent for further delivery to each Lender that requests at least two Business Days prior to the Amendment No. 6 Effective Date, a Revolving Credit Note reflected its Revolving Credit Commitment as set forth on the Amended Commitment Schedule.
(h) Solvency Certificate. The Administrative Agent shall have received a certificate of the chief financial officer of the Borrower stating that, after giving effect to this Amendment, the Borrower and its Subsidiaries, taken as a whole, are Solvent.
(i) Fees and Expenses. All fees and expenses payable on or before the Amendment No. 6 Effective Date by the Borrower to the Administrative Agent, the Lead Arrangers or the Lenders party hereto (or their respective Affiliates) in connection with this Amendment shall have been paid in accordance with Section 11.3 of the Credit Agreement, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent.
(j) PATRIOT Act. The Administrative Agent and the Lenders party hereto shall have received, at least three (3) Business Days prior to the Amendment No. 6 Effective Date, (i) all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including but not restricted to the USA PATRIOT Act and (ii) a Beneficial Ownership Certification, in each case to the extent requested at least ten business days prior to the Amendment No. 6 Effective Date.
(k) Required Flood Materials. The Lenders party hereto shall have received the Required Flood Materials not less than five (5) Business Days prior to the Amendment No. 6 Effective Date.
(l) Perfection Certificate. The Lenders party hereto shall have received a Perfection Certificate, substantially in the form agreed with the Administrative Agent prior to the Amendment No. 6 Effective Date.
(m) Mortgage Amendments. With respect to the existing Mortgages encumbering the Pennsylvania Mining Complex and the Baltimore Dock Facility, the Collateral Agent shall have received an amendment to such existing Mortgages to update the Encumbered Building and Excluded Assets schedules thereto.
(n) Receivables Subsidiary Designation. The Administrative Agent shall have received (i) a Board Resolution designating each of ARCH RECEIVABLE COMPANY, LLC, a Delaware limited liability company and CONSOL FUNDING LLC, a Delaware limited liability company, as a Receivables Subsidiary and (ii) an Officer’s Certificate certifying that such designation complies with the conditions to such designation specified in Section 1.1 of the Amended Credit Agreement.
3. Post-Closing Real Estate Deliverables. Not later than sixty (60) days after the Amendment No. 6 Effective Date, unless extended by the Collateral Agent in its sole discretion upon reasonable request of the Borrower, the Borrower shall deliver (or cause to be delivered) to the Collateral Agent, with respect to each existing Mortgage, the following, each in form and substance reasonably acceptable to the Collateral Agent:
-5-
(a) an amendment to such Mortgage (each, a “Mortgage Amendment”), duly executed and acknowledged by the applicable Loan Party, and in proper form for recording in the land records in the jurisdiction in which the applicable mortgaged property is located and sufficient to create a valid and enforceable mortgage lien on such mortgaged property, in favor of the Collateral Agent for the benefit of the Secured Parties (as defined in such Mortgage), securing the Secured Debt (as defined in such Mortgage);
(b) a datedown endorsement (or such other title product as acceptable to the Collateral Agent if a datedown endorsement is not available in the applicable jurisdiction) (each, a “Title Endorsement”) to the existing title insurance policy for such Mortgage, insuring the Collateral Agent that the lien of such Mortgage, as amended by the applicable Mortgage Amendment, is a valid and enforceable first priority lien on the mortgaged property described therein, in favor of the Collateral Agent for the benefit of the Secured Parties (as defined in such Mortgage) free and clear of all defects, encumbrances and liens except for Permitted Liens;
(c) evidence that the Borrower has delivered to the title company such affidavits, certificates, information, instruments of indemnification and other documents as may be reasonably necessary to cause the title company to issue the Title Endorsements contemplated by clause (b) above; and
(d) evidence of payment by the Borrower of all title premiums, search and examination charges, escrow charges and related charges, mortgage recording taxes, fees, charges, costs and expenses required for the recording of the Mortgage Amendments contemplated by clause (a) above and issuance of the Title Endorsements contemplated by clause (b) above.
4. Full Force and Effect; Reaffirmation. All of the terms, conditions, representations, warranties and covenants contained in the Loan Documents shall continue in full force and effect except, in each case, as expressly modified by this Amendment. This Amendment shall constitute a Loan Document for purposes of the Credit Agreement. All references to the Credit Agreement in any Loan Document, unless expressly provided otherwise, shall mean and be a reference to the Credit Agreement as amended by this Amendment. Each Loan Party, by its signature below, hereby affirms and confirms (i) its obligations under each of the Loan Documents to which it is a party and (ii) its guarantee of the Obligations and the prior pledge of and/or grant of a security interest in its assets as Collateral to secure the Obligations, and acknowledges and agrees that such guarantee, pledge and/or grant continue in full force and effect in respect of, and to secure, the Obligations. This Amendment, the amendment of the Credit Agreement pursuant to this Amendment and all other Loan Documents amended and/or executed and delivered in connection herewith shall not constitute a novation of the Credit Agreement and the other Loan Documents as in effect prior to the Amendment No. 6 Effective Date.
5. Joinder. By their execution of this Amendment, each of ITMANN MINING COMPANY LP, a Delaware limited partnership, CONSOL PENNSYLVANIA MINE HOLDING LLC, a Delaware limited liability company and CONSOL MET COAL HOLDING COMPANY LLC, a Delaware limited liability company (collectively, the “New Guarantors”) hereby becomes a Guarantor under the terms of the Credit Agreement and in consideration of the value of the synergistic and other benefits received by each New Guarantor as a result of being or becoming affiliated with the Borrower and the Guarantors, each New Guarantor hereby agrees that effective as of the date hereof it hereby is, and shall be deemed to be, and assumes the obligations (i) of a “Loan Party” and a “Guarantor” under the Credit Agreement, a “Guarantor” under the Continuing Agreement of Guaranty and Suretyship, dated as of November 28, 2017 (as the same may be amended, restated, supplemented or modified from time to time, the “Guaranty”), of the Loan Parties, as guarantors, given to the Administrative Agent for the benefit of the
-6-
Lenders, and (ii) a “Company” under the Intercompany Subordination Agreement, a “Loan Party” under the Regulated Substances Certificate and Indemnity Agreement, dated as of November 28, 2017 (as the same may be amended, restated, supplemented or modified from time to time, the “Indemnity Agreement”), among the Loan Parties and the Collateral Agent for the benefit of the Secured Parties and a Loan Party or Guarantor, as the case may be, under each of the other Loan Documents to which the Loan Parties or Guarantors are required to become a party pursuant to the terms of Section 8.1.9 of the Credit Agreement; and each New Guarantor hereby agrees that, from the date hereof and until Payment In Full, such New Guarantor shall perform, comply with, and be subject to and bound by each of the terms and provisions of the Credit Agreement, Guaranty, Intercompany Subordination Agreement, Indemnity Agreement and each of the other Loan Documents to which Loan Parties are required to become parties pursuant to the terms of Section 8.1.9 of the Credit Agreement. Without limiting the generality of the foregoing, each New Guarantor hereby represents and warrants that (i) each of the representations and warranties set forth in Section 6 of the Credit Agreement applicable to such Loan Party is true and correct as to such New Guarantor on and as of the date hereof and (ii) such New Guarantor has heretofore received a true and correct copy of the Credit Agreement, Guaranty, Intercompany Subordination Agreement, Indemnity Agreement and each of the other Loan Documents (including any modifications thereof or supplements or waivers thereto) in effect on the date hereof to which such New Guarantor is required to become a party. Each New Guarantor hereby makes, affirms, and ratifies in favor of the Lenders and the Administrative Agent the Credit Agreement, Guaranty, Intercompany Subordination Agreement, Indemnity Agreement and each of the other Loan Documents to which such New Guarantor is becoming a party pursuant to the terms of the preceding sentence.
6. Counterparts. This Amendment may be executed by different parties hereto in any number of separate counterparts, each of which, when so executed and delivered shall be an original and all such counterparts shall together constitute one and the same instrument. Delivery of an executed counterpart of this Amendment by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment. The words “execution,” “signed,” “signature,” and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state Laws based on the Uniform Electronic Transactions Act.
7. Severability. If any term of this Amendment or any application thereof shall be held to be invalid, illegal or unenforceable, the validity of other terms of this Amendment or any other application of such term shall in no way be affected thereby.
8. Entire Agreement. This Amendment sets forth the entire agreement and understanding of the parties with respect to the amendments to the Loan Documents contemplated hereby and supersedes all prior understandings and agreements, whether written or oral, between the parties hereto relating to such amendments. No representation, promise, inducement or statement of intention has been made by any party that is not embodied in this Amendment, and no party shall be bound by or liable for any alleged representation, promise, inducement or statement of intention not set forth herein.
9. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of New York without regard to its conflict of laws principles. The provisions of Section 11.11.2 through 11.11.5 of the Credit Agreement shall apply to this Amendment mutatis mutandis.
[SIGNATURE PAGES FOLLOW]
-7-
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Amendment as of the day and year first above written.
| CORE NATURAL RESOURCES, INC., AS BORROWER | ||
| By: | /s/ Mitesh Thakkar | |
| Name: | Mitesh Thakkar | |
| Title: | President and Chief Financial Officer | |
[Signature Page to Amendment No. 6 to Credit Agreement]
| GUARANTORS: | ||
| AMVEST LLC | ||
| AMVEST GAS RESOURCES, LLC | ||
| AMVEST WEST VIRGINIA COAL, L.L.C. | ||
| BRAXTON-CLAY LAND & MINERAL, LLC | ||
| CONSOL MARINE TERMINALS LLC | ||
| CONSOL RCPC LLC | ||
| CONRHEIN COAL COMPANY | ||
| CONSOL AMONATE FACILITY LLC | ||
| CONSOL AMONATE MINING COMPANY LLC | ||
| CONSOL ENERGY SALES COMPANY LLC | ||
| CONSOL MINING COMPANY LLC | ||
| CONSOL MINING HOLDING COMPANY LLC | ||
| CONSOL OF CANADA LLC | ||
| CONSOL OF KENTUCKY LLC | ||
| CONSOL PENNSYLVANIA COAL COMPANY LLC | ||
| FOLA COAL COMPANY, L.L.C. | ||
| HELVETIA COAL COMPANY LLC | ||
| ISLAND CREEK COAL COMPANY LLC | ||
| LAUREL RUN MINING COMPANY LLC | ||
| LEATHERWOOD, LLC | ||
| LITTLE EAGLE COAL COMPANY, L.L.C. | ||
| MTB LLC | ||
| NICHOLAS-CLAY LAND & MINERAL, LLC | ||
| R&PCC LLC | ||
| TECPART LLC | ||
| TERRY EAGLE COAL COMPANY, L.L.C. | ||
| TERRY EAGLE LIMITED PARTNERSHIP | ||
| VAUGHAN RAILROAD COMPANY LLC | ||
| WINDSOR COAL COMPANY LLC | ||
| WOLFPEN KNOB DEVELOPMENT COMPANY LLC | ||
| PA MINING COMPLEX GP LLC | ||
| CONSOL OPERATING LLC | ||
| CONSOL THERMAL HOLDINGS LLC | ||
| CONSOL COAL FINANCE CORP. | ||
| TRANSFORMER LP HOLDINGS INC. | ||
| CONSOL PENNSYLVANIA MINE HOLDING LLC | ||
| CONSOL MET COAL HOLDING COMPANY LLC | ||
| By: | /s/ Steven T. Aspinall | |
| Name: | Steven T. Aspinall | |
| Title: | Authorized Officer | |
[Signature Page to Amendment No. 6 to Credit Agreement]
| PA MINING COMPLEX LP | ||
| By: PA MINING COMPLEX GP LLC, its general partner | ||
| By: | /s/ Steven T. Aspinall | |
| Name: | Steven T. Aspinall | |
| Title: | Authorized Officer | |
| ITMANN MINING COMPANY LP | ||
| By: CORE NATURAL RESOURCES, INC., its general partner | ||
| By: | /s/ Steven T. Aspinall | |
| Name: | Steven T. Aspinall | |
| Title: | Authorized Officer | |
[Signature Page to Amendment No. 6 to Credit Agreement]
| PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent | ||
| By: | /s/ Kyle T. Helfrich | |
| Name: | Kyle T. Helfrich | |
| Title: | Senior Vice President | |
[Signature Page to Amendment No. 6 to Credit Agreement]
| PNC Bank, National Association, as a Lender and an Issuing Lender | ||
| By: | /s/ Daniel Scherling | |
| Name: | Daniel Scherling | |
| Title: | Vice President | |
[Signature Page to Amendment No. 6 to Credit Agreement]
| Axos Bank, as a Lender and an Issuing Lender | ||||
| By: | /s/ David Park | |||
| Name: | David Park | |||
| Title: | Executive Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Burke & Herbert Bank, as a Lender | ||||
| By: | /s/ Lisa Dennison | |||
| Name: | Lisa Dennison | |||
| Title: | Market President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Dollar Bank, Federal Savings Bank, as a Lender and an Issuing Lender | ||||
| By: | /s/ Mark Woleslagle | |||
| Name: | Mark Woleslagle | |||
| Title: | Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| EverBank, N.A., as a Lender and an Issuing Lender | ||||
| By: | /s/ Aric Graham | |||
| Name: | Aric Graham | |||
| Title: | Head of Corporate Banking | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| First National Bank of Pennsylvania, as a Lender and an Issuing Lender | ||||
| By: | /s/ Paul Wargo | |||
| Name: | Paul Wargo | |||
| Title: | Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| KeyBank National Association, as a Lender and an Issuing Lender | ||||
| By: | /s/ Deanna Clayson | |||
| Name: | Deanna Clayson | |||
| Title: | Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Manufacturers and Traders Trust Company as a Lender and an Issuing Lender | ||||
| By: | /s/ Stephen Hoffman | |||
| Name: | Stephen Hoffman | |||
| Title: | Managing Director | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| NORTHWEST BANK, as a Lender and an Issuing Lender | ||||
| By: | /s/ Stephen J. Orban | |||
| Name: | Stephen J. Orban | |||
| Title: | Senior Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| REGIONS BANK, as a Lender and an Issuing Lender | ||||
| By: | /s/ Tom Scheinzbach | |||
| Name: | Tom Scheinzbach | |||
| Title: | Director | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Old National Bank, as a Lender and an Issuing Lender | ||||
| By: | /s/ Rhoads Hall | |||
| Name: | Rhoads Hall | |||
| Title: | Senior Vice President | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Texas Capital Bank, as a Lender and an Issuing Lender | ||
| By: | /s/ Kurt Steves | |
| Name: Kurt Steves | ||
| Title: Managing Director | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| City National Bank of West Virginia, as a Lender | ||
| By: | /s/ Brian Parrott | |
| Name: Brian Parrott | ||
| Title: Senior Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| FIRST FOUNDATION BANK, as a Lender and an Issuing Lender | ||
| By: | /s/ Joe Kucik | |
| Name: Joe Kucik | ||
| Title: Senior Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Independent Bank, as a Lender and an Issuing Lender | ||
| By: | /s/ David Dunlay | |
| Name: David Dunlay | ||
| Title: Senior Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Mid Penn Bank, as a Lender and an Issuing Lender | ||
| By: | /s/ Dan M. Baronick | |
| Name: Dan M. Baronick | ||
| Title: Senior Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| FIRST FIDELITY BANK, as a Lender and an Issuing Lender | ||
| By: | /s/ James W. Finch | |
| James W. Finch | ||
| Executive Vice-President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| GOLDMAN SACHS BANK USA, as a Lender and an Issuing Lender | ||
| By: | /s/ Andrew Vernon | |
| Name: Andrew Vernon | ||
| Title: Authorized Signatory | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| ICICI Bank Canada, as a Lender and an Issuing Lender | ||||
| By: | /s/ Jigar Jain | |||
| Name: | Jigar Jain | |||
| Title: | Chief Risk Officer ICICI Bank Canada | |||
| By: | /s/ Lester Fernandes | |||
| Name: | Lester Fernandes | |||
| Title: | Head - Corporate & Commercial Banking ICICI Bank Canada | |||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Somerset Trust Company, as a Lender and an Issuing Lender | ||
| By: | /s/ Parke Kreinbrook | |
| Name: Parke Kreinbrook | ||
| Title: Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| S&T Bank, as a Lender and an Issuing Lender | ||
| By: | /s/ Gregory R. Boyer | |
| Name: Gregory R. Boyer | ||
| Title: Senior Vice President | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
| Washington Financial bank, as a Lender and an Issuing Lender | ||
| By: | /s/ William J. King, Jr. | |
| Name: William J. King, Jr. | ||
| Title: EVP, Chief Lending Officer | ||
[Signature Page to Amendment No. 6 to Credit Agreement]
EXHIBIT A
CONFORMED CREDIT AGREEMENT
[see attached]
EXHIBIT A TO AMENDMENT NO. 6
BORROWER CUSIP #20855DAM7
REVOLVING CREDIT FACILITY CUSIP #20855DAN5
CREDIT AGREEMENT
by and among
CORE NATURAL RESOURCES, INC.
(formerly known as CONSOL ENERGY INC.),
as Borrower
THE GUARANTORS PARTY HERETO
THE LENDERS PARTY HERETO
PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent
PNC BANK, NATIONAL ASSOCIATION,
as Collateral Agent
OLD NATIONAL BANK and
TEXAS CAPITAL BANK,
as Co-Documentation Agents
PNC CAPITAL MARKETS LLC,
AXOS BANK,
BURKE & HERBERT BANK,
DOLLAR BANK, FEDERAL SAVINGS BANK,
EVERBANK, N.A.,
FIRST NATIONAL BANK OF PENNSYLVANIA,
KEYBANK NATIONAL ASSOCIATION,
MANUFACTURERS AND TRADERS TRUST COMPANY,
NORTHWEST BANK and
REGIONS CAPITAL MARKETS, A DIVISION OF REGIONS BANK,
as Joint Lead Arrangers and Joint Bookrunners
Dated as of November 28, 2017,
as amended as of January 14, 2025
TABLE OF CONTENTS
| Page | ||||
| 1. CERTAIN DEFINITIONS |
1 | |||
| 1.1 Certain Definitions |
1 | |||
| 1.2 Construction/Calculations |
58 | |||
| 1.3 Accounting Principles |
59 | |||
| 1.4 Valuations |
59 | |||
| 1.5 Letter of Credit Amounts |
60 | |||
| 1.6 Pro Forma Financial Covenant Compliance |
60 | |||
| 1.7 Interest Rates |
60 | |||
| 2. FACILITIES |
61 | |||
| 2.1 Commitments |
61 | |||
| 2.1.1 Revolving Credit Loans |
61 | |||
| 2.1.2 Swing Loans |
61 | |||
| 2.2 Lenders’ Obligations Several |
61 | |||
| 2.3 Commitment Fees |
61 | |||
| 2.4 Commitment Reductions and Terminations |
62 | |||
| 2.4.1 Revolving Credit Commitments |
62 | |||
| 2.4.2 Term Loan Commitments |
62 | |||
| 2.5 Loan Requests |
63 | |||
| 2.5.1 Loan Requests |
63 | |||
| 2.5.2 Swing Loan Requests |
63 | |||
| 2.6 Making Loans; Presumptions by Administrative Agent; Repayment of Revolving Credit Loans; Borrowings to Repay Swing Loans |
64 | |||
| 2.6.1 Making Loans. |
64 | |||
| 2.6.2 Presumptions by the Administrative Agent |
64 | |||
| 2.6.3 Making Swing Loans |
65 | |||
| 2.6.4 Repayment of Loans |
65 | |||
| 2.7 Notes |
65 | |||
| 2.7.1 Revolving Credit Notes |
65 | |||
| 2.7.2 Swing Loan Note |
65 | |||
| 2.7.3 Term Notes |
65 | |||
| 2.8 Use of Proceeds |
66 | |||
| 2.9 Letters of Credit |
66 | |||
| 2.9.1 Issuance of Letters of Credit |
66 | |||
| 2.9.2 Letter of Credit Fees |
68 | |||
| 2.9.3 Participations, Disbursements, Reimbursement |
68 | |||
| 2.9.4 Repayment of Participation Advances |
69 | |||
| 2.9.5 Documentation |
70 | |||
| 2.9.6 Determinations to Honor Drawing Requests |
70 | |||
| 2.9.7 Nature of Participation and Reimbursement Obligations |
70 | |||
| 2.9.8 Indemnity |
71 | |||
| 2.9.9 Liability for Acts and Omissions |
72 | |||
| 2.9.10 Cash Collateral Prior to the Revolving Maturity Date |
73 | |||
| 2.9.11 Issuing Lender Reporting Requirements |
73 | |||
| 2.10 Borrowings to Repay Swing Loans |
74 | |||
| Page | ||||
| 2.11 Incremental Facilities |
74 | |||
| 2.11.1 Establishment of Incremental Facilities |
74 | |||
| 2.11.2 Conditions |
74 | |||
| 2.11.3 Terms of Revolving Commitment Increases |
75 | |||
| 2.11.4 Terms of Incremental Term Loan Commitments |
75 | |||
| 2.11.5 Notes |
76 | |||
| 2.11.6 Approval of Incremental Lenders |
76 | |||
| 2.11.7 Documentation |
76 | |||
| 2.11.8 Syndication |
76 | |||
| 2.11.9 Treatment of Outstanding Loans and Letters of Credit |
77 | |||
| 2.12 Extended Term Loans and Extended Revolving Credit Commitments |
77 | |||
| 2.13 Refinancing Term Loans |
80 | |||
| 2.14 Replacement Revolving Credit Commitments |
81 | |||
| 2.15 Defaulting Lenders |
83 | |||
| 3. [RESERVED] |
85 | |||
| 4. INTEREST RATES |
85 | |||
| 4.1 Interest Rate Options |
85 | |||
| 4.1.1 Interest Rate Options; Swing Line Interest Rate |
85 | |||
| 4.1.2 Rate Quotations |
85 | |||
| 4.1.3 [Reserved] |
85 | |||
| 4.1.4 Conforming Changes Relating to Term SOFR Rate or Daily Simple SOFR |
85 | |||
| 4.2 Interest Periods |
86 | |||
| 4.3 Interest After Default |
86 | |||
| 4.4 Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs |
86 | |||
| 4.4.1 Term SOFR Rate Unascertainable |
86 | |||
| 4.4.2 Daily Simple SOFR Unascertainable |
87 | |||
| 4.4.3 Illegality; Increased Costs |
87 | |||
| 4.4.4 Administrative Agent’s and Lender’s Rights |
87 | |||
| 4.5 Selection of Interest Rate Options |
88 | |||
| 4.6 Benchmark Replacement Setting |
88 | |||
| 5. PAYMENTS |
92 | |||
| 5.1 Payments |
92 | |||
| 5.2 Pro Rata Treatment of Lenders |
93 | |||
| 5.3 Sharing of Payments by Lenders. |
93 | |||
| 5.4 Presumptions by Administrative Agent |
93 | |||
| 5.5 Interest Payment Dates |
94 | |||
| 5.6 Voluntary Prepayments |
94 | |||
| 5.6.1 Right to Prepay |
94 | |||
| 5.6.2 Replacement of a Lender |
95 | |||
| 5.6.3 Designation of a Different Lending Office |
96 | |||
| 5.7 Mandatory Prepayments |
96 | |||
| 5.7.1 Revolving Credit Commitments |
96 | |||
| 5.7.2 [Reserved] |
97 | |||
ii
| Page | ||||
| 5.7.3 [Reserved] |
97 | |||
| 5.7.4 [Reserved] |
97 | |||
| 5.7.5 [Reserved] |
97 | |||
| 5.7.6 Application of Payments; Application Among Interest Rate Options |
97 | |||
| 5.8 Increased Costs |
97 | |||
| 5.8.1 Increased Costs Generally |
97 | |||
| 5.8.2 Capital Requirements |
98 | |||
| 5.8.3 Certificates for Reimbursement; Repayment of Outstanding Loans; Borrowing of New Loans |
98 | |||
| 5.8.4 Delay in Requests |
98 | |||
| 5.9 Taxes |
98 | |||
| 5.9.1 Payments Free of Taxes |
98 | |||
| 5.9.2 Payment of Other Taxes by the Borrower |
99 | |||
| 5.9.3 Indemnification by the Borrower |
99 | |||
| 5.9.4 Evidence of Payments |
99 | |||
| 5.9.5 Status of Lenders |
99 | |||
| 5.9.6 Refunds |
101 | |||
| 5.9.7 Definition of Lender |
101 | |||
| 5.9.8 Administrative Agent Forms |
101 | |||
| 5.10 Indemnity |
102 | |||
| 5.11 Settlement Date Procedures |
102 | |||
| 6. REPRESENTATIONS AND WARRANTIES |
103 | |||
| 6.1 Organization and Qualification |
103 | |||
| 6.2 EEA Financial Institutions |
103 | |||
| 6.3 Subsidiaries |
103 | |||
| 6.4 Power and Authority |
103 | |||
| 6.5 Validity and Binding Effect |
104 | |||
| 6.6 No Conflict |
104 | |||
| 6.7 Litigation |
104 | |||
| 6.8 Title to Properties |
104 | |||
| 6.9 Financial Statements |
105 | |||
| 6.10 Use of Proceeds |
105 | |||
| 6.11 Liens in the Collateral |
105 | |||
| 6.12 Full Disclosure |
106 | |||
| 6.13 Taxes |
106 | |||
| 6.14 Consents and Approvals |
107 | |||
| 6.15 No Event of Default; Compliance with Instruments |
107 | |||
| 6.16 Patents, Trademarks, Copyrights, Licenses, Permits, Etc. |
107 | |||
| 6.17 Solvency |
107 | |||
| 6.18 Real Property |
107 | |||
| 6.19 Insurance |
108 | |||
| 6.20 Compliance with Laws |
108 | |||
| 6.21 Burdensome Restrictions |
108 | |||
| 6.22 Investment Companies; Regulated Entities |
108 | |||
| 6.23 ERISA Compliance |
108 | |||
| 6.24 Employment Matters; Coal Act; Black Lung Act |
109 | |||
| 6.25 Environmental Matters |
109 | |||
| 6.26 Anti-Terrorism Laws; Anti-Corruption Laws |
110 | |||
iii
| Page | ||||
| 6.27 Margin Regulations |
110 | |||
| 6.28 Surety Bonds |
110 | |||
| 6.29 Coal Supply Agreements |
111 | |||
| 7. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT |
111 | |||
| 7.1 [Reserved] |
111 | |||
| 7.2 Each Additional Loan or Letter of Credit |
111 | |||
| 8. COVENANTS |
112 | |||
| 8.1 Affirmative Covenants |
112 | |||
| 8.1.1 Preservation of Existence, Etc. |
112 | |||
| 8.1.2 Payment of Liabilities, Including Taxes, Etc. |
112 | |||
| 8.1.3 Maintenance of Insurance |
112 | |||
| 8.1.4 Maintenance of Properties and Equipment |
113 | |||
| 8.1.5 Maintenance of Patents, Trademarks, Etc. |
113 | |||
| 8.1.6 Visitation Rights |
114 | |||
| 8.1.7 Keeping of Records and Books of Account |
114 | |||
| 8.1.8 Further Assurances |
114 | |||
| 8.1.9 Additional Guarantors |
114 | |||
| 8.1.10 Compliance with Laws |
115 | |||
| 8.1.11 Use of Proceeds; Margin Regulations |
115 | |||
| 8.1.12 Subordination of Intercompany Loans |
115 | |||
| 8.1.13 Anti-Terrorism Laws; Anti-Corruption Laws |
115 | |||
| 8.1.14 [Reserved] |
116 | |||
| 8.1.15 Accounts |
116 | |||
| 8.1.16 ERISA Compliance |
116 | |||
| 8.1.17 Collateral |
116 | |||
| 8.1.18 Title |
120 | |||
| 8.1.19 Maintenance of Permits |
120 | |||
| 8.1.20 Preparation of Environmental Reports |
120 | |||
| 8.1.21 Post-Closing Matters |
121 | |||
| 8.2 Negative Covenants |
121 | |||
| 8.2.1 Indebtedness |
121 | |||
| 8.2.2 Liens |
123 | |||
| 8.2.3 Designation of Unrestricted Subsidiaries |
123 | |||
| 8.2.4 Loans and Investments |
124 | |||
| 8.2.5 Restricted Payments |
127 | |||
| 8.2.6 Liquidations, Mergers, Consolidations, Acquisitions |
128 | |||
| 8.2.7 Dispositions |
130 | |||
| 8.2.8 Affiliate Transactions |
131 | |||
| 8.2.9 Change in Business |
133 | |||
| 8.2.10 Fiscal Year |
133 | |||
| 8.2.11 Amendments to Certain Documents |
133 | |||
| 8.2.12 Swaps |
133 | |||
| 8.2.13 Financial Covenants |
133 | |||
| 8.2.14 Restrictions on Distributions from Restricted Subsidiaries |
134 | |||
| 8.2.15 Negative Pledge Agreements |
135 | |||
| 8.2.16 [Reserved] |
137 | |||
iv
| Page | ||||
| 8.2.17 [Reserved] |
137 | |||
| 8.2.18 Anti-Hoarding |
137 | |||
| 8.3 Reporting Requirements |
137 | |||
| 8.3.1 Quarterly Financial Statements |
138 | |||
| 8.3.2 Annual Financial Statements |
138 | |||
| 8.3.3 SEC Website |
138 | |||
| 8.3.4 Certificate of the Borrower |
138 | |||
| 8.3.5 Notice of Default |
139 | |||
| 8.3.6 Certain Events |
139 | |||
| 8.3.7 Budgets, Forecasts, Other Reports and Information |
139 | |||
| 8.3.8 Lender Calls |
140 | |||
| 9. DEFAULT |
140 | |||
| 9.1 Events of Default |
140 | |||
| 9.1.1 Payments Under Loan Documents |
141 | |||
| 9.1.2 Breach of Warranty |
141 | |||
| 9.1.3 Breach of Certain Covenants |
141 | |||
| 9.1.4 Breach of Other Covenants |
141 | |||
| 9.1.5 Defaults in Other Agreements or Indebtedness |
141 | |||
| 9.1.6 Final Judgments or Orders |
142 | |||
| 9.1.7 Loan Document Unenforceable |
142 | |||
| 9.1.8 Inability to Pay Debts |
142 | |||
| 9.1.9 ERISA |
142 | |||
| 9.1.10 Change of Control |
142 | |||
| 9.1.11 [Reserved] |
143 | |||
| 9.1.12 Involuntary Proceedings |
143 | |||
| 9.1.13 Voluntary Proceedings |
143 | |||
| 9.2 Consequences of Event of Default |
143 | |||
| 9.2.1 Events of Default Other Than Bankruptcy, Insolvency or Reorganization Proceedings |
143 | |||
| 9.2.2 Bankruptcy, Insolvency or Reorganization Proceedings |
144 | |||
| 9.2.3 Set-off |
144 | |||
| 9.2.4 [Reserved] |
145 | |||
| 9.2.5 Application of Proceeds |
145 | |||
| 9.2.6 Collateral Agent |
146 | |||
| 9.2.7 Other Rights and Remedies |
146 | |||
| 9.3 Notice of Sale |
146 | |||
| 10. THE AGENTS |
146 | |||
| 10.1 Appointment and Authority |
146 | |||
| 10.2 Rights as a Lender |
147 | |||
| 10.3 Exculpatory Provisions |
147 | |||
| 10.4 Reliance by Agents |
148 | |||
| 10.5 Delegation of Duties |
148 | |||
| 10.6 Resignation of Agents |
148 | |||
| 10.7 Non-Reliance on Administrative Agent and Other Lenders |
150 | |||
| 10.8 No Other Duties, Etc. |
150 | |||
| 10.9 Administrative Agent’s Fee |
150 | |||
v
| Page | ||||
| 10.10 Authorization to Release Collateral and Guarantors |
150 | |||
| 10.11 No Reliance on Administrative Agent’s Customer Identification Programs |
151 | |||
| 10.12 Withholding Tax |
151 | |||
| 10.13 Certain ERISA Matters |
151 | |||
| 10.14 [Reserved] |
152 | |||
| 10.15 Certain Payments |
152 | |||
| 11. MISCELLANEOUS |
154 | |||
| 11.1 Modifications, Amendments or Waivers |
154 | |||
| 11.1.1 Required Consents |
154 | |||
| 11.1.2 Certain Amendments |
155 | |||
| 11.1.3 Amendments Affecting the Agents, Etc. |
155 | |||
| 11.1.4 Non-Consenting Lenders |
155 | |||
| 11.1.5 Defaulting Lenders |
156 | |||
| 11.2 No Implied Waivers; Cumulative Remedies |
156 | |||
| 11.3 Expenses; Indemnity; Damage Waiver |
156 | |||
| 11.3.1 Costs and Expenses |
156 | |||
| 11.3.2 Indemnification by the Borrower |
156 | |||
| 11.3.3 Reimbursement by Lenders |
157 | |||
| 11.3.4 Waiver of Consequential Damages, Etc. |
157 | |||
| 11.3.5 Payments |
158 | |||
| 11.4 Holidays |
158 | |||
| 11.5 Notices; Effectiveness; Electronic Communication |
158 | |||
| 11.5.1 Notices Generally |
158 | |||
| 11.5.2 Electronic Communications |
158 | |||
| 11.5.3 Change of Address, Etc. |
159 | |||
| 11.6 Severability |
159 | |||
| 11.7 Duration; Survival |
159 | |||
| 11.8 Successors and Assigns |
159 | |||
| 11.8.1 Successors and Assigns Generally |
159 | |||
| 11.8.2 Assignments by Lenders |
160 | |||
| 11.8.3 Register |
163 | |||
| 11.8.4 Participations |
163 | |||
| 11.8.5 Certain Pledges; Successors and Assigns Generally |
164 | |||
| 11.9 Confidentiality |
164 | |||
| 11.9.1 General |
164 | |||
| 11.9.2 Sharing Information With Affiliates of the Lenders |
165 | |||
| 11.10 Counterparts; Integration; Effectiveness |
165 | |||
| 11.11 Governing Law, Etc. |
166 | |||
| 11.11.1 Governing Law |
166 | |||
| 11.11.2 SUBMISSION TO JURISDICTION |
166 | |||
| 11.11.3 WAIVER OF VENUE |
166 | |||
| 11.11.4 SERVICE OF PROCESS |
167 | |||
| 11.11.5 WAIVER OF JURY TRIAL |
167 | |||
| 11.12 Mutual Negotiations |
167 | |||
| 11.13 Certain Collateral Matters |
167 | |||
| 11.14 USA PATRIOT Act Notice |
168 | |||
| 11.15 No Fiduciary Duty |
168 | |||
| 11.16 Acknowledgment and Consent to Bail-In of Affected Financial Institutions |
168 | |||
| 11.17 Acknowledgement Regarding Any Supported QFCs |
169 | |||
vi
LIST OF SCHEDULES AND EXHIBITS
SCHEDULES
| Schedule 1.1(A) | Pricing Grid | |
| Schedule 1.1(B) | Commitments of Lenders | |
| Schedule 1.1(C) | Existing Letters of Credit | |
| Schedule 1.1(D) | Litigation | |
| Schedule 6.1 | Qualifications To Do Business | |
| Schedule 6.3 | Subsidiaries | |
| Schedule 8.1.17 | Material Buildings | |
| Schedule 8.1.18 | Title Requirements | |
| Schedule 8.1.21 | Post-Closing Matters | |
| Schedule 8.2.1 | Existing Indebtedness | |
| Schedule 8.2.2 | Existing Liens | |
| Schedule 8.2.4(x) | Existing Investments | |
| Schedule 8.2.4(y) | Existing Investments by GasCo | |
| Schedule 8.2.8 | Existing Affiliate Transactions | |
| Schedule 8.2.14 | Existing Restrictions on Subsidiaries | |
| Schedule 8.2.15 | Existing Negative Pledge Agreements | |
| Schedule 8.2.16 | [Reserved] | |
| Schedule 11.5.1 | Notice Information |
EXHIBITS
| Exhibit 1.1(A)(1) | [Reserved] | |
| Exhibit 1.1(A)(2) | Assignment and Assumption Agreement | |
| Exhibit 1.1(G)(1) | Guarantor Joinder | |
| Exhibit 1.1(G)(2) | Guaranty Agreement | |
| Exhibit 1.1(I)(1) | Indemnity | |
| Exhibit 1.1(I)(2) | Intercompany Subordination Agreement | |
| Exhibit 1.1(M) | Mortgage | |
| Exhibit 1.1(N)(1) | Revolving Credit Note | |
| Exhibit 1.1(N)(2) | Swing Loan Note | |
| Exhibit 1.1(N)(3) | Term Note | |
| Exhibit 1.1(P)(1) | Perfection Certificate | |
| Exhibit 1.1(P)(2) | Perfection Certificate Supplement | |
| Exhibit 2.5.1 | Loan Request | |
| Exhibit 2.5.2 | Swing Loan Request | |
| Exhibit 5.9.5 | United States Tax Compliance Certificate | |
| Exhibit 8.2.6 | Acquisition Certificate | |
| Exhibit 8.3.4 | Quarterly Compliance Certificate |
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the “Agreement”) is dated as of November 28, 2017, as amended as of January 14, 2025, and is made by and among CORE NATURAL RESOURCES, INC. (formerly known as CONSOL ENERGY INC.), a Delaware corporation (the “Borrower”), EACH OF THE GUARANTORS (as hereinafter defined), the LENDERS (as hereinafter defined), PNC BANK, NATIONAL ASSOCIATION, as administrative agent (the “Administrative Agent”) and PNC BANK, NATIONAL ASSOCIATION, as collateral agent for the Lenders and the other Secured Parties (in such capacity, the “Collateral Agent”).
WHEREAS, the Borrower has requested the Lenders to provide a revolving credit facility to the Borrower;
NOW, THEREFORE, in consideration of their mutual covenants and agreements hereinafter set forth and intending to be legally bound hereby, the parties hereto covenant and agree as follows:
1. CERTAIN DEFINITIONS
1.1 Certain Definitions.
In addition to words and terms defined elsewhere in this Agreement, the following words and terms shall have the following meanings, respectively, unless the context hereof clearly requires otherwise:
“Account” shall have the meaning set forth in the Security Agreement.
“Additional Credit Extension Amendment” shall mean an amendment to this Agreement (which may, at the option of the Administrative Agent in consultation with the Borrower, be in the form of an amendment and restatement of this Agreement) providing for any Incremental Facilities pursuant to Section 2.11 [Incremental Facilities], Extended Term Loans and/or Extended Revolving Credit Commitments pursuant to Section 2.12 [Extended Term Loans and Extended Revolving Credit Commitments], Refinancing Term Loans pursuant to Section 2.13 [Refinancing Term Loans], and/or Replacement Revolving Credit Commitments pursuant to Section 2.14 [Replacement Revolving Credit Commitments], which shall be consistent with the applicable provisions of this Agreement and otherwise reasonably satisfactory to the parties thereto. Each Additional Credit Extension Amendment shall be executed by (i) the Administrative Agent, (ii) in the case of any Revolving Commitment Increase, Extended Revolving Credit Commitment or Replacement Revolving Credit Commitment, the Issuing Lenders that would be entitled, under Section 11.8.2(c) [Assignments by Lenders], to consent to an assignment to the Lenders providing such Revolving Commitment Increase, Extended Revolving Credit Commitment or Replacement Revolving Credit Commitment as if such transaction were an assignment, (iii) in the case of any Revolving Commitment Increase, Extended Revolving Credit Commitment or Replacement Revolving Credit Commitment, the Swingline Lender, (iv) the Loan Parties and (v) the other parties specified in the applicable Section of this Agreement (but not any other Lender not specified in the applicable Section of this Agreement) and acknowledged by the Collateral Agent, but shall not effect any amendments that would require the consent of each affected Lender or all Lenders pursuant to the proviso in Section 11.1.1 [Required Consents] (other than amendments relating to provisions of Incremental Term Loans, Extended Revolving Credit Commitments, Extended Term Commitments, Extended Term Loans or Refinancing Term Loans that are expressly permitted to be different from those of the Loans or Commitments under the terms of Section 2.11 [Incremental Facilities], Section 2.12 [Extended Term Loans and Extended Revolving Credit Commitments] or Section 2.13 [Refinancing Term Loans], as applicable). Any Additional Credit Extension Amendment may include conditions for delivery of customary opinions of counsel and
other documentation consistent with the conditions in Section 7.1.1 [Deliveries] of this Agreement as in effect on the Closing Date and certificates confirming satisfaction of conditions consistent with Section 7.2 [Each Additional Loan or Letter of Credit], all to the extent reasonably requested by any applicable Agent or the other parties to such Additional Credit Extension Amendment; provided that the effectiveness of each Additional Credit Extension Amendment shall be subject to the Required Flood Materials having been made available to the Lenders not less than five (5) Business Days prior to the effective date of such Additional Credit Extension Amendment. In addition, each Additional Credit Extension Amendment shall include a certification by an Authorized Officer of the Borrower that, after giving effect to such Additional Credit Extension Amendment and assuming that any Revolving Commitment Increase is fully drawn (and, notwithstanding the definition of “Indebtedness,” all letters of credit (including Letters of Credit) being deemed to have a principal amount of outstanding Indebtedness equal to the maximum potential liability of the Borrower and its Restricted Subsidiaries thereunder), the aggregate amount of Indebtedness under this Agreement shall not exceed the Applicable Other Indebtedness Cap; provided that (x) at the Administrative Agent’s request, the Borrower shall provide the Administrative Agent calculations and supporting information reasonably satisfactory to the Administrative Agent showing compliance with the Applicable Other Indebtedness Cap and (y) notwithstanding the foregoing clause (x), the Administrative Agent shall have no obligation to request such calculation or information or to determine compliance with the Applicable Other Indebtedness Cap, and shall be fully entitled to assume (without any further investigation) that each borrowing of Loans and each issuance, amendment, extension or increase of a Letter of Credit complies with the Applicable Other Indebtedness Cap if the Borrower makes a Loan Request for such borrowing or application or request with respect to any such Letter of Credit.
“Adjusted Term SOFR” shall mean the Term SOFR Rate as determined as provided in the definition thereof plus the SOFR Adjustment. If Adjusted Term SOFR would be less than the SOFR Floor, then Adjusted Term SOFR shall be deemed to be the SOFR Floor.
“Administrative Agent” shall have the meaning specified in the preamble hereto.
“Administrative Agent’s Fee” shall have the meaning specified in Section 10.9 [Administrative Agent’s Fee].
“Administrative Agent’s Letter” shall have the meaning specified in Section 10.9 [Administrative Agent’s Fee].
“Affected Financial Institution” shall mean (a) any EEA Financial Institution or (b) any UK Financial Institution.
“Affiliate” of any specified Person shall mean any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of Voting Stock, by agreement or otherwise. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.
“Affiliate Transaction” shall have the meaning assigned to such term in Section 8.2.8 [Affiliate Transactions].
“Agents” shall mean, collectively, the Administrative Agent and the Collateral Agent. The term “Agent” shall mean any of the Agents.
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“Agreement” shall have the meaning specified in the preamble hereto.
“Amendment No. 1” shall mean that certain Amendment No. 1 to this Agreement, dated as of the Amendment No. 1 Effective Date.
“Amendment No. 1 Effective Date” shall mean March 28, 2019.
“Amendment No. 2” shall mean that certain Amendment No. 2 to this Agreement, dated as of the Amendment No. 2 Effective Date.
“Amendment No. 2 Effective Date” shall mean June 5, 2020.
“Amendment No. 4” shall mean that certain Amendment No. 4 to this Agreement, dated as of the Amendment No. 4 Effective Date.
“Amendment No. 4 Effective Date” shall mean July 18, 2022.
“Amendment No. 5” shall mean that certain Amendment No. 5 to this Agreement, dated as of the Amendment No. 5 Effective Date.
“Amendment No. 5 Effective Date” shall mean June 12, 2023.
“Amendment No. 6” shall mean that certain Amendment No. 6 to this Agreement, dated as of the Amendment No. 6 Effective Date.
“Amendment No. 6 Effective Date” shall mean January 14, 2025.
“Anti-Corruption Laws” shall mean (a) the U.S. Foreign Corrupt Practices Act and rules and regulations thereunder, (b) the UK Bribery Act and (c) other anti-corruption and anti-bribery laws and regulations of any applicable jurisdiction.
“Anti-Terrorism Laws” shall mean any Laws relating to terrorism, trade sanctions programs and embargoes, import/export licensing, money laundering or bribery, and any regulation, order, or directive promulgated, issued or enforced pursuant to such Laws, including the USA PATRIOT Act and regulations of OFAC.
“Applicable Account” shall mean a Deposit Account, a Securities Account or a Commodity Account (each as defined in the UCC), but excluding any Deposit Account that is an Excluded Account.
“Applicable Letter of Credit Fee Rate” shall mean the percentage rate per annum based on the Total Net Leverage Ratio according to the applicable table on Schedule 1.1(A) below the heading “Term SOFR Loans.”
“Applicable Margin” shall mean
(A) for Revolving Credit Loans:
(a) the percentage spread to be added to the Base Rate applicable to such Loans under the Base Rate Option based on the Total Net Leverage Ratio according to the applicable table on Schedule 1.1(A) below the heading “Base Rate Loans,” or
-3-
(b) the percentage spread to be added to the Term SOFR Rate or Daily Simple SOFR, as applicable, applicable to such Loans under the Term SOFR Rate Option or Daily Simple SOFR Option, as applicable, based on the Total Net Leverage Ratio according to the applicable table on Schedule 1.1(A) below the heading “Term SOFR Loans / Daily Simple SOFR Loans”; and
(B) and with respect to Term Loans, as set forth in the Additional Credit Extension Amendment relating thereto.
“Applicable Maturity Date” shall mean (i) with respect to the CONSOL BMT Bonds, September 1, 2025, (ii) with respect to the CONSOL CRDA Bonds, April 13, 2028 and (iii) with respect to any Applicable Refinancing Debt, the scheduled maturity of such Applicable Refinancing Debt.
“Applicable Other Indebtedness Cap” shall mean the maximum amount of Indebtedness (and, notwithstanding the definition of “Indebtedness,” with letters of credit (including Letters of Credit) being deemed to have an outstanding principal amount of Indebtedness equal to the maximum potential liability of the Borrower and its Restricted Subsidiaries thereunder) permitted under indebtedness covenants under indentures or other documentation governing Indebtedness incurred pursuant to Section 8.2.1(i) or (m), as such provisions are in effect from time to time; provided that if any such provision in any such indentures or documentation permits different amounts of Indebtedness, the most restrictive provision shall govern for purposes of this definition.
“Applicable Refinancing Debt” shall have the meaning assigned to such term in the definition of “Revolving Maturity Date.”
“Approved Fund” shall mean any fund that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
“Arch” shall mean Arch Resources, Inc., a Delaware corporation.
“Arch Accession Date” shall have the meaning assigned to such term in Section 8.1.9.
“Arch Acquired Entity” shall mean any Person comprising Arch or one of its Subsidiaries that shall have been acquired by the Borrower pursuant to the Arch Merger that is not within the meaning of the definition of “Excluded Subsidiaries”.
“Arch Merger” shall mean the combination of the Borrower and Arch in an all stock-merger of equals transaction pursuant to the Arch Merger Agreement, pursuant to which Arch and its Subsidiaries shall become Subsidiaries of Borrower.
“Arch Merger Agreement” shall mean that certain Agreement and Plan of Merger, dated as of August 20, 2024, by and among CONSOL Energy Inc., Mountain Range Merger Sub Inc. and Arch, as in effect on August 20, 2024.
“Arch Tax Exempt Bonds” shall mean those certain Waste Disposable Facility Revenue Bonds (Arch Resources Project), Series 2020 and Series 2021 issued pursuant the Arch Tax Exempt Bonds Indenture in an aggregate principal amount not to exceed $98,075,000.
-4-
“Arch Tax Exempt Bonds Indenture” shall mean that certain Indenture of Trust, dated as of June 1, 2020, between the West Virginia Economic Development Authority and the Arch Tax Exempt Bonds Trustee, as in effect on the Amendment No. 6 Effective Date.
“Arch Tax Exempt Bonds Trustee” shall mean Citibank, N.A., as trustee under the Arch Tax Exempt Bonds Indenture.
“Assignment and Assumption Agreement” shall mean an assignment and assumption agreement entered into by a Lender and an assignee permitted under Section 11.8 [Successors and Assigns], in substantially the form of Exhibit 1.1(A)(2).
“Authorized Officer” shall mean, with respect to any Loan Party, the chief executive officer, president, chief financial officer, treasurer or assistant treasurer of such Loan Party or such other individuals, designated by written notice to each Agent from the Borrower, authorized to execute notices, reports and other documents on behalf of the Loan Parties required hereunder. The Borrower may amend such list of individuals from time to time by giving written notice of such amendment to each Agent.
“Auto-Extension Letter of Credit” shall have the meaning assigned to such term in Section 2.9.1(c) [Issuance of Letters of Credit].
“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” shall mean, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation, rule or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
“Balance Sheet Cash” shall mean cash, Temporary Cash Investments and any other amounts of the Borrower and its Restricted Subsidiaries that would be reflected as “cash and cash equivalents” on a consolidated balance sheet of the Borrower and its Subsidiaries.
“Baltimore Dock Facility” shall mean that certain terminal, storage, loading and dock facility, including all facilities and equipment supporting such facility, located in Baltimore, Maryland owned as of the Closing Date by CONSOL Marine Terminals, Inc. (f/k/a CNX Marine Terminals, Inc.), including all related easements, rights of way and the similar interests used in connection with such facility.
“Bankruptcy Code” shall mean Title 11 of the United States Code.
“Base Rate” shall mean, for any day, a fluctuating per annum rate of interest equal to the highest of (a) the Federal Funds Open Rate, plus 0.5%, (b) the Prime Rate, (c) the Daily Simple SOFR, so long as Daily Simple SOFR is offered, ascertainable and not unlawful, plus 100 basis points (1.0%) and (d) 1.00% per annum; provided, however, if the Base Rate as determined above would be less than zero, then such rate shall be deemed to be zero. Any change in the Base Rate (or any component thereof) shall take effect at the opening of business on the day such change occurs.
-5-
“Base Rate Option” shall mean the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 4.1.1(a)(i) [Base Rate Option].
“Benchmark Replacement” shall have the meaning specified in Section 4.6(f) [Benchmark Replacement Setting].
“Beneficial Owner” shall have the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “Person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “Person” will be deemed to have beneficial ownership of all securities that such “Person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the passage of time. The terms “Beneficially Owns” and “Beneficially Owned” have corresponding meanings. For purposes of this definition, a Person shall be deemed not to Beneficially Own securities that are the subject of a stock purchase agreement, merger agreement, amalgamation agreement, arrangement agreement or similar agreement until consummation of the transactions or, as applicable, series of related transactions contemplated thereby.
“Beneficial Ownership Certification” shall mean a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.
“Beneficial Ownership Regulation” shall mean 31 C.F.R. § 1010.230.
“Benefit Plan” shall mean any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” (as defined in Section 4975 of the Code) or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan.”
“Black Lung Act” shall mean, collectively, the Black Lung Benefits Revenue Act of 1977, as amended and the Black Lung Benefits Reform Act of 1977, as amended.
“Board of Directors” shall mean, with respect to any Person, (a) if the Person is a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board or a similar governing body, (b) if the Person is a partnership, the board of directors of the general partner of the partnership or any committee thereof duly authorized to act on behalf of such board or a similar governing body and (c) with respect to any other Person, the functional equivalent of the foregoing.
“Board Resolution” shall mean a copy of a resolution certified by the Secretary or an Assistant Secretary of the Borrower to have been duly adopted by the Board of Directors of the Borrower and to be in full force and effect on the date of such certification.
“Bookrunners” shall mean PNC Capital Markets LLC, Axos Bank, Burke & Herbert Bank, Dollar Bank, Federal Savings Bank, EverBank, N.A., First National Bank of Pennsylvania, KeyBank National Association, Manufacturers and Traders Trust Company, Northwest Bank and Regions Capital Markets, a division of Regions Bank, in their capacities as bookrunners of the revolving credit facility hereunder.
“Borrower” shall have the meaning specified in the preamble hereto.
“Borrowing Date” shall mean, with respect to any Loan, the date for the making thereof or the renewal or conversion thereof at or to the same or a different Interest Rate Option, which shall be a Business Day.
-6-
“Borrowing Tranche” shall mean specified portions of Loans of any Class outstanding as follows: (a) any Loans of such Class to which a Term SOFR Rate Option applies which become subject to the same Interest Rate Option under the same Loan Request by the Borrower and which have the same Interest Period shall constitute one Borrowing Tranche, (b) all Loans to which a Daily Simple SOFR Option applies shall constitute one Borrowing Tranche, (c) all Revolving Credit Loans of such Class to which a Base Rate Option applies shall constitute one Borrowing Tranche and (d) all Swing Loans to which a Base Rate Option applies shall constitute one Borrowing Tranche.
“Building” shall mean a walled and roofed structure, other than a gas or liquid storage tank, that is principally above ground and affixed to a permanent site, and a walled and roofed structure while in the course of construction, alteration or repair or shall have such other meaning ascribed to such term in the Flood Laws.
“Business Day” shall mean any day other than a Saturday or Sunday or a legal holiday on which commercial banks are authorized or required to be closed for business in Pittsburgh, Pennsylvania (or, if otherwise, the lending office of the Administrative Agent); provided that for purposes of any direct or indirect calculation or determination of, or when used in connection with any interest rate settings, fundings, disbursements, settlements, payments or other dealings with respect to SOFR, the term “Business Day” shall mean any such day that is also a U.S. Government Securities Business Day.
“Capital Lease Obligation” shall mean, subject to Section 1.3 [Accounting Principles], an obligation that is required to be classified and accounted for as a capital lease or financing lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty.
“Capital Stock” of any Person shall mean (a) in the case of a corporation, corporate stock; (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (c) in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membership interests; and (d) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person, but excluding from all of the foregoing any debt securities exercisable for, exchangeable for or convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.
“Cash Collateralize” shall mean to pledge and deposit with or deliver to the Administrative Agent, for the benefit of each applicable Issuing Lender, as collateral for the Letter of Credit Obligations, cash or deposit account balances pursuant to documentation reasonably satisfactory to the Administrative Agent and each applicable Issuing Lender (which documents are hereby consented to by the Lenders). Such cash collateral shall be maintained in blocked deposit accounts at the Administrative Agent. At the option of the applicable Issuing Lender, in lieu of cash collateral, the applicable Letter of Credit Obligations may be supported by one or more back-to-back letters of credit in form and from institutions reasonably satisfactory to such Issuing Lender, and such arrangement shall also be within the meaning of Cash Collateralize. The term “Cash Collateral” shall have a correlative meaning.
“Cash on Hand” shall mean, as of any date of determination, an amount equal to the sum of (i) the aggregate amount of unrestricted cash and Temporary Cash Investments of the Loan Parties as of such date and (ii) the aggregate amount of cash and Temporary Cash Investments of the Loan Parties pledged solely (x) to the Collateral Agent for the benefit of the Secured Parties to secure the Obligations
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as of such date and (y) subject to the Intercreditor Agreements, to the collateral agent for the benefit of the secured parties under Indebtedness incurred under Section 8.2.1(i) [Indebtedness], in each case, after giving effect to all incurrences and repayments of Indebtedness, issuances of Equity Interests, Investments and Restricted Payments to occur on such date; provided that Cash on Hand shall exclude any Cash Collateral or any other cash collateral pledged to secure obligations under any letters of credit.
“Casualty Event” shall mean, with respect to any assets of the Borrower or any Restricted Subsidiary, any damage to or destruction of, or any condemnation or other taking (including by any Official Body) of, any such assets that occurs after the Closing Date for which the Borrower or any Restricted Subsidiary receives insurance proceeds or proceeds of a condemnation award or any other compensation. Casualty Event shall include but not be limited to any taking of all or any part of any real property of the Borrower or any Restricted Subsidiary in or by condemnation or other eminent domain proceedings pursuant to any Law, or by reason of the temporary requisition or the use or occupancy of all or any part of any real property by any Official Body, civil or military.
“CFC” shall mean a Subsidiary of the Borrower that is a “controlled foreign corporation” as defined in Section 957 of the Code.
“CFC Holdco” shall mean a Subsidiary of the Borrower that owns no material assets other than Equity Interests in one or more Foreign Subsidiaries that are CFCs.
“Change in Law” shall mean the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any Law, (b) any change in any Law or in the administration, interpretation, implementation or application thereof by any Official Body or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of Law) by any Official Body; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, regulations, guidelines, interpretations or directives thereunder or issued in connection therewith (whether or not having the force of Law) and (y) all requests, rules, regulations, guidelines, interpretations or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities (whether or not having the force of Law), in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” regardless of the date enacted, adopted, issued, promulgated or implemented.
“Change of Control” shall mean:
(a) the consummation of any transaction (including any merger or consolidation or the acquisition of any Capital Stock) the result of which is that any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the Beneficial Owner, directly or indirectly, of more than 35% of the total voting power of the Voting Stock of the Borrower;
(b) the holders of Capital Stock of the Borrower shall have approved any plan of liquidation or dissolution of the Borrower;
(c) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Borrower (including Equity Interests of Restricted Subsidiaries) and the Restricted Subsidiaries, taken as a whole, to any Person other than a Loan Party; or
(d) a “change of control” or similar event occurred under any agreement governing any Indebtedness incurred under Section 8.2.1(i) or (m) [Indebtedness].
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“CIP Regulations” shall have the meaning assigned to such term in Section 10.11 [No Reliance on Administrative Agent’s Customer Identification Programs].
“Class” shall mean (a) with respect to any Commitment, its character as a Revolving Credit Commitment or any other group of Commitments (whether established by way of new Commitments or by way of conversion or extension of existing Commitments or Loans) designated as a “Class” in an Additional Credit Extension Amendment and (b) with respect to any Loans, its character as a Revolving Credit Loan, a Swing Loan, or any other group of Loans (whether made pursuant to new Commitments or by way of conversion or extension of existing Loans) designated as a “Class” in an Additional Credit Extension Amendment; provided that (i) in no event shall there be more than two Classes of Revolving Credit Commitments or Revolving Credit Loans outstanding at any time, (ii) notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, the borrowing and repayment of Revolving Credit Loans shall be made on a pro rata basis across all Classes of Revolving Credit Loans (except to the extent that any applicable Additional Credit Extension Amendment provides that the Class of Revolving Credit Loans established thereunder shall be entitled to less than pro rata repayments), and any termination of Revolving Credit Commitments shall be made on a pro rata basis across all Classes of Revolving Credit Commitments (except to the extent that any applicable Additional Credit Extension Amendment provides that the Class of Revolving Credit Commitments established thereunder shall be entitled to less than pro rata treatment) and (iii) the repayment of the Term Loans of any Class shall be made on a pro rata basis among Term Loans of such Class except as specifically set forth in Section 2.12 [Extended Term Loans and Extended Revolving Credit Commitments] or 2.13 [Refinancing Term Loans]. Commitments or Loans that have different maturity dates, pricing (other than upfront fees or original issue discount), other terms shall be designated as separate Classes.
“Closing Date” shall mean November 28, 2017.
“Coal” shall mean all types of solid naturally occurring hydrocarbons (other than oil shale or Gilsonite), including bituminous and sub-bituminous coal, and lignite.
“Coal Act” shall mean the Coal Industry Retiree Health Benefits Act of 1992.
“Coal Gas” shall mean occluded methane gas and all associated natural gas and other hydrocarbons of whatever quality or quantity, whether known or unknown, that are, can be, or historically have been produced or emitted from coalbeds, coal formations, coal seams, mined out areas, gob areas, or any related, associated, or adjacent rock material or strata, together with all substances produced with each of the foregoing or refined therefrom. For the avoidance of doubt, the term “Coal Gas” shall expressly include all substances commonly known as “coalbed methane,” “coal mine methane,” and “gob gas.”
“Coal Supply Agreement” means with respect the Borrower or any of its Subsidiaries an agreement or contract in effect on the Amendment No. 6 Effective Date or thereafter entered into for the sale, purchase, exchange, processing or handling of coal with an initial term of more than one year.
“Code” shall mean the Internal Revenue Code of 1986.
“Collateral” shall mean the property of whatever kind and nature subject or purported to be subject from time to time to a Lien under any Security Document, but shall not include (i) any asset that shall have been released, pursuant to Section 10.10 [Authorization to Release Collateral and Guarantors] or Section 11.1.1(d) [Required Consents], from the Liens created under such Security Document or (ii) any Excluded Assets.
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“Collateral Agent” shall have the meaning specified in the preamble hereto, and shall include any successor collateral agent.
“Commercial Letter of Credit” shall mean any letter of credit which is a commercial letter of credit issued in respect of the purchase of goods or services by the Borrower or any of its Subsidiaries.
“Commitment” shall mean as to any Lender its Revolving Credit Commitment, commitment to provide a Revolving Commitment Increase, Extended Revolving Credit Commitment, Replacement Revolving Credit Commitment, Incremental Term Loan Commitment, Extended Revolving Credit Commitment, Extended Term Commitment, commitment to provide Refinancing Term Loans or any combination thereof (as the context requires), and “Commitments” shall mean the aggregate Commitments of the appropriate Class or any combinations thereof (as the context requires) of all of the Lenders.
“Commitment Fee” shall have the meaning specified in Section 2.3 [Commitment Fees].
“Commitment Fee Rate” shall mean 0.50% per annum.
“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.).
“Compliance Certificate” shall have the meaning specified in Section 8.3.4 [Certificate of the Borrower].
“Conforming Changes” shall mean, with respect to the Term SOFR Rate or Daily Simple SOFR or any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and implementation of the Term SOFR Rate or Daily Simple SOFR or such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of the Term SOFR Rate or Daily Simple SOFR or the Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).
“Consideration” shall mean, with respect to any acquisition, without duplication, the aggregate of (i) the cash paid by the Borrower or any Restricted Subsidiary, directly or indirectly, to the seller in connection therewith, (ii) the Indebtedness assumed by the Borrower or any Restricted Subsidiary in connection therewith and (iii) any other consideration given by the Borrower or any Restricted Subsidiary in connection therewith.
“CONSOL BMT Bonds” shall mean those certain 5.75% Port Facilities Refunding Revenue Bonds (CONSOL Marine Terminals LLC. (f/k/a CNX Marine Terminals Inc.) Port of Baltimore Facility) Series 2010 due September 2025 issued pursuant to the CONSOL BMT Bonds Indenture in an aggregate principal amount not exceeding $102,865,000.
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“CONSOL BMT Bonds Indenture” shall mean that certain indenture of trust, dated as of September 1, 2010 by and among Maryland Economic Development Corporation and Wells Fargo Bank, N.A., as trustee.
“CONSOL CRDA Bonds” shall mean those certain Solid Waste Disposal Revenue Bonds, Series 2021A (CONSOL Energy Inc. Project) due April 2028 issued pursuant to the CONSOL CRDA Bonds Indenture in an aggregate principal amount not exceeding $75,000,000.
“CONSOL CRDA Bonds Indenture” shall mean that certain Indenture, dated as of April 1, 2021, between the Pennsylvania Economic Development Financing Authority and the CONSOL CRDA Bonds Trustee.
“CONSOL CRDA Bonds Trustee” shall mean, Wilmington Trust, N.A., as trustee under the CONSOL CRDA Bonds Indenture.
“CONSOL Innovations” shall mean CONSOL Innovations LLC, a Delaware limited liability company, individually, and collectively, together with its subsidiary CFOAM LLC, a Delaware limited liability company.
“Consolidated Cash Interest Expense” shall mean, for any period, Consolidated Interest Expense for such period, net of any cash interest income, excluding the portion thereof not paid or payable in cash.
“Consolidated EBITDA” shall mean, for any period, the sum of Consolidated Net Income, plus (a) other than in the case of clause (7) below, to the extent deducted in calculating such Consolidated Net Income (without duplication):
(1) Consolidated Interest Expense, net of interest income;
(2) provision for taxes based on income or profits (including state franchise taxes accounted for as income taxes in accordance with GAAP) of the Borrower and the Restricted Subsidiaries for such period;
(3) depletion, depreciation and impairment charges and expenses of the Borrower and the Restricted Subsidiaries for such period;
(4) amortization expense (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) of the Borrower and the Restricted Subsidiaries for such period;
(5) losses (or minus gains) for such period from the early extinguishment of Indebtedness;
(6) to the extent permitted hereunder, any (A) amendments, restatements and other modifications of the Loan Documents, (B) acquisition, investment, disposition, issuance or repayment of debt, issuance of equity securities, refinancing transaction or amendment or other modification of any debt instrument (in each case, including any such transaction undertaken but not completed) and (C) charges or non-recurring merger costs incurred during such period as a result of any such transaction, in each case whether or not successful, in an aggregate amount under this clause (6) not to exceed, in any four-quarter period, $10,000,000;
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(7) net cash proceeds of insurance received, or recognized as a receivable in accordance with GAAP, for such period in respect of a casualty event (to the extent such amount is reducing an expense on the statement of operations of the Borrower for such period relating to such casualty event) or business interruption; provided that to the extent such amount is actually not received in cash, the amount not received that increased Consolidated EBITDA shall be deducted from Consolidated EBITDA in the period in which it is determined that such amount has not been or is not likely to be received;
(8) write-offs of legacy receivables outstanding on the Amendment No. 2 Effective Date in an aggregate amount during the term of this Agreement not to exceed $14,000,000; provided that if the Borrower or any Restricted Subsidiary receives any amount in respect of a legacy receivable previously written-off and added back to Consolidated EBITDA pursuant to this clause (8), such amount so received will be deducted from Consolidated EBITDA for the period in which such amount so received is realized;
(9) transaction-related expenses, costs and charges incurred by the Borrower or any Restricted Subsidiary in each case in connection with the Arch Merger and related financing fees and expenses, in each case, incurred within 24 months of the date of the consummation of the Arch Merger, in an aggregate amount under this clause (9) not to exceed, in any four-quarter period, 10.0% of Consolidated EBITDA (such 10.0% limit to be calculated prior to giving effect to any amounts added back pursuant to this clause (9));
(10) non-cash impairment charges or asset write-offs and non-cash charges, including non-cash charges due to cumulative effects of changes in accounting principles (but excluding any such non-cash charge that represents an accrual or reserve for potential cash items in any future period or amortization of a prepaid cash item that was paid in a prior period); and
(11) settlement payments arising from litigation set forth on Schedule 1.1(D) and any related expenses, costs and charges arising from such litigation incurred by the Borrower or any Restricted Subsidiary, in an aggregate amount under this clause (11) during the term of this Agreement not to exceed (without duplication) the greater of (i) $100,000,000 and (ii) 10.0% of Consolidated EBITDA (such limitation in this clause (ii) to be calculated prior to giving effect to any amounts added back pursuant to this clause (11));
minus (b) to the extent increasing Consolidated Net Income for such period, gains for such period from the early extinguishment of Indebtedness. Consolidated EBITDA shall be calculated on a Pro Forma Basis (including, without limitation, for the Arch Merger) except for purposes of calculating Interest Coverage Ratio for purposes of compliance with Section 8.2.13(c) [Minimum Interest Coverage Ratio] or as otherwise set forth in Section 1.6(e).
“Consolidated First Lien Debt” shall mean Consolidated Indebtedness other than any Consolidated Indebtedness that is (i) unsecured or (ii) secured by a Lien on the Collateral that is contractually junior to the Lien securing the Obligations. For the avoidance of doubt, Consolidated First Lien Debt includes the Obligations under the documents described in clause (i) of the definition of “Obligations” and the obligations under any Qualified Receivables Transaction.
“Consolidated Indebtedness” shall mean the sum (without duplication) of (a) the aggregate principal amount of Indebtedness of the Borrower and the Restricted Subsidiaries of the type referenced under the first instances of clause (1), (2) or (3) of the definition of “Indebtedness” outstanding on such date and (b) all obligations of Borrower and the Restricted Subsidiaries under (i) any drawn letters of credit, bankers’ acceptances or similar credit transactions that are not reimbursed within one Business
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Day following receipt by Borrower or the relevant Restricted Subsidiary of a demand for reimbursement following payment on such letter of credit, bankers’ acceptance or similar credit transaction and (ii) to the extent that the aggregate face amount thereof exceeds $250,000,000, undrawn letters of credit (including Letters of Credit issued hereunder), undrawn bankers’ acceptances or similar undrawn credit transactions, but excluding any letters of credit issued pursuant to a Qualified Receivables Transaction, in each case of the Borrower and the Restricted Subsidiaries outstanding as of such date, in each case under clause (a) or (b), after giving effect to all incurrences and repayments of such Indebtedness occurring on such date, provided, for the avoidance of doubt, such undrawn letters of credit, undrawn bankers’ acceptances and similar undrawn credit transactions by reason of clause (ii) hereof shall not constitute Consolidated Indebtedness to the extent (x) the aggregate face amount thereof is $250,000,000 or less or (y) issued pursuant to a Qualified Receivables Transaction.
“Consolidated Interest Expense” shall mean, for any period, the total interest expense of the Borrower and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP (excluding (i) write-off of deferred financing costs and (ii) accretion of interest charges on future plugging and abandonment obligations, future retirement benefits and other obligations that do not constitute Indebtedness), plus, to the extent not included in such total interest expense, and to the extent incurred by the Borrower or any Restricted Subsidiary, without duplication:
(1) interest expense attributable to Capital Lease Obligations;
(2) capitalized interest;
(3) non-cash interest expense; and
(4) net costs (including amortization of fees and up-front payments) associated with Interest Rate Agreements and Currency Agreements that, at the time entered into, resulted in the Borrower and the Restricted Subsidiaries being net payees as to future payouts under such Interest Rate Agreements or Currency Agreements, and Interest Rate Agreements and Currency Agreements for which the Borrower or any Restricted Subsidiary has paid a premium;
provided that “Consolidated Interest Expense” shall not include any amortization of costs relating to original debt issuances other than the amortization of debt discount related to the issuance of zero coupon securities or other securities with an original issue price of not more than 90% of the principal thereof. Consolidated Interest Expense shall be calculated on a Pro Forma Basis (except as set forth in Section 1.6(e)).
“Consolidated Net Income” shall mean the aggregate net income (loss) attributable to the Borrower and its Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that there shall not be included in such Consolidated Net Income:
(1) any net income of any other Person if such other Person is not a Restricted Subsidiary, except that: (a) subject to the exclusion contained in clause (4) of this definition, the Borrower’s equity in the net income of such other Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such other Person during such period to the Borrower or any Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to a Restricted Subsidiary, to the limitations contained in clause (2) of this definition); and
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(b) the Borrower’s equity in a net loss of any such other Person for such period shall be included in determining such Consolidated Net Income;
(2) any net income of any Restricted Subsidiary (other than a Guarantor) if such Restricted Subsidiary is subject to restrictions, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Borrower, except that:
(a) subject to the exclusion contained in clause (4) below, the Borrower’s equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Restricted Subsidiary during such period to the Borrower or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to another Restricted Subsidiary, to the limitation contained in this clause); and
(b) the Borrower’s equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income;
(3) any income or loss attributed to discontinued operations;
(4) any extraordinary gains or losses, together with any related provision for taxes on such gains or losses;
(5) any gain or loss, together with any related provision for taxes on such gains or losses, on Dispositions outside the ordinary course of business;
(6) any non-cash compensation expense realized for grants of performance shares, stock, stock options or other equity-based awards;
(7) unrealized losses and gains under derivative instruments included in the determination of Consolidated Net Income, including those resulting from the application of FASB ASC 815;
(8) any non-cash asset impairment or write-downs (other than of any current assets) under GAAP or SEC guidelines; provided that any reversal or other benefit of any such impairment or write-down in any future period shall be excluded from Consolidated Net Income in such future period; and
(9) the cumulative effect of a change in accounting principles.
“Contractual Requirement” shall have the meaning assigned to that term in Section 6.6 [No Conflict].
“Covered Entity” shall mean (a) the Borrower, each of the Borrower’s Subsidiaries, all Guarantors and all pledgors of Collateral, and (b) each Person that, directly or indirectly, is an Affiliate of a Person described in clause (a) above.
“Covered Party” shall have the meaning assigned to such term in Section 11.17(a) [Acknowledgement Regarding Any Supported QFCs].
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“CPCC” shall mean CONSOL Pennsylvania Coal Company LLC, a Delaware limited liability company.
“CTA” shall mean, at any time, the amount which, in accordance with GAAP, would be set forth under the caption “Total Assets” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries, excluding the accounts of Unrestricted Subsidiaries and all assets that are considered to be intangible assets under GAAP, as of (unless otherwise specified) the end of the latest fiscal period for which financial statements have been delivered pursuant to Section 8.3.1 [Quarterly Financial Statements] or 8.3.2 [Annual Financial Statements] at or prior to such time.
“Currency Agreement” shall mean in respect of a Person any foreign exchange contract, currency swap agreement or other similar agreement to which such Person is a party or a beneficiary.
“Current Lender” shall have the meaning assigned to such term in Section 2.11.1 [Establishment of Incremental Facilities].
“Customary Recourse Exceptions” shall mean, with respect to any Non-Recourse Debt of any Person, exclusions from the exculpation provisions with respect to such Non-Recourse Debt for the voluntary bankruptcy of such Person, fraud, misapplication of cash, environmental claims, waste, willful destruction and other circumstances customarily excluded by lenders from exculpation provisions or included in separate indemnification agreements in non-recourse financings.
“Daily Simple SOFR” shall mean, for any day (a “SOFR Rate Day”), the interest rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, at the Administrative Agent’s discretion, to the nearest 1/100th of 1%) (A) SOFR for the day (the “SOFR Determination Date”) that is 2 Business Days prior to (i) such SOFR Rate Day if such SOFR Rate Day is a Business Day or (ii) the Business Day immediately preceding such SOFR Rate Day if such SOFR Rate Day is not a Business Day, by (B) a number equal to 1.00 minus the SOFR Reserve Percentage, in each case, as such SOFR is published by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source identified by the Federal Reserve Bank of New York or its successor administrator for the secured overnight financing rate from time to time. If Daily Simple SOFR as determined above would be less than the SOFR Floor, then Daily Simple SOFR shall be deemed to be the SOFR Floor. If SOFR for any SOFR Determination Date has not been published or replaced with a Benchmark Replacement by 5:00 p.m. (Pittsburgh, Pennsylvania time) on the second Business Day immediately following such SOFR Determination Date, then SOFR for such SOFR Determination Date will be SOFR for the first Business Day preceding such SOFR Determination Date for which SOFR was published in accordance with the definition of “SOFR”; provided that SOFR determined pursuant to this sentence shall be used for purposes of calculating Daily Simple SOFR for no more than 3 consecutive SOFR Rate Days. If and when Daily Simple SOFR as determined above changes, any applicable rate of interest based on Daily Simple SOFR will change automatically without notice to the Borrower, effective on the date of any such change.
“Daily Simple SOFR Loan” shall mean a Loan that bears interest at a rate based on Daily Simple SOFR.
“Daily Simple SOFR Option” shall mean the option of the Borrower to have Swing Loans bear interest at the rate and under the terms specified in Section 4.1(a)(iii) [Swing Loan Interest Rate].
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“Debtor Relief Laws” means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.
“Defaulting Lender” shall mean any Lender that (a) has failed, within three Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) in the case of a Revolving Lender, fund any portion of its participations in Letters of Credit or Swing Loans or (iii) pay over to any Agent, any Issuing Lender, the Swingline Lender or any Lender any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) has not been satisfied, (b) has notified the Borrower or the Administrative Agent in writing, or has made a public statement to the effect, that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular default, if any) to funding a Loan under this Agreement cannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by the Administrative Agent or the Borrower, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations) to fund prospective Loans and, if applicable, participations in then outstanding Letters of Credit and Swing Loans under this Agreement; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon the Administrative Agent’s or the Borrower’s receipt of such certification in form and substance satisfactory to the Administrative Agent or the Borrower, as the case may be, (d) has become the subject of a Bankruptcy Event or (e) has, or has a direct or indirect parent company that has, become the subject of a Bail-In Action.
As used in this definition and in Section 2.15 [Defaulting Lenders], the term “Bankruptcy Event” shall mean, with respect to any Person, such Person or such Person’s direct or indirect parent company becoming the subject of a bankruptcy or insolvency proceeding, or having had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment; provided that a Bankruptcy Event shall not result solely by virtue of (i) any ownership interest, or the acquisition of any ownership interest, in such Person or such Person’s direct or indirect parent company by an Official Body or instrumentality thereof if, and only if, such ownership interest does not result in or provide such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Person (or such Official Body or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person or (ii) the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official by a supervisory authority or regulator with respect to a Person or a Person’s direct or indirect parent company under the Dutch Financial Supervision Act 2007 (as amended from time to time and including any successor legislation) if applicable law prohibits the public disclosure of such appointment and so long as such appointment has in fact not been publicly disclosed.
“Deposit Accounts” shall have the meaning given to such term in the UCC.
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“Designated Non-Cash Consideration” shall mean the Fair Market Value of non-cash Consideration received by the Borrower or a Restricted Subsidiary of the Borrower in connection with a Disposition that is so designated as Designated Non-Cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation, less the amount of cash or Temporary Cash Investments received in connection with a subsequent sale of or collection on such Designated Non-Cash Consideration.
“Disposition” or “Dispose” shall mean the sale, conveyance, assignment, lease, sale and leaseback, abandonment or other transfer or disposal of, voluntarily or involuntarily, of any property or assets, tangible or intangible, including the sale, assignment, discount or other disposition of Accounts, equipment or general intangibles with or without recourse, the issuance or sale of Capital Stock of a Subsidiary or granting of options or rights of first refusal in such assets. In the case of the grant of an option or right of first refusal with respect to any asset, the date of such grant shall be deemed to be the date of Disposition of such asset.
“Disqualified Person” shall mean (a) a Person whose primary business competes with that of the Borrower and is identified by the Borrower in writing prior to the Amendment No. 6 Effective Date, to the Administrative Agent as a “Disqualified Person” and (b) any Affiliate of a Person referred to in clause (a), which Affiliate is identified by the Borrower in writing prior to the Amendment No. 6 Effective Date to the Administrative Agent as a “Disqualified Person” or identified by the Administrative Agent as an Affiliate of a Person referred to in clause (a) solely on the basis of its name; provided that any Affiliate of a Disqualified Person that is (i) a bank, (ii) a bona fide diversified debt fund or (iii) an investment vehicle that is engaged in the making, purchasing, holding or investing in, acquiring or trading commercial loans, bonds or similar extensions of credit in the ordinary course, is not, and shall not be deemed to be, a Disqualified Person. The Borrower may supplement the list of Disqualified Persons to add competitors (and their respective Affiliates) of the Borrower from time to time in writing to the Administrative Agent; provided that (a) each supplement shall only be given effect two Business Days after it is provided to the Lenders and (b) the Borrower may not supplement the list of Disqualified Persons to add any Person that is referred to in clause (i), (ii) or (iii) above.
“Disqualified Stock” shall mean any Equity Interests of a Person or any Restricted Subsidiary that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable, in either case at the option of the holder thereof) or otherwise (a) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (b) is or may become redeemable or repurchaseable at the option of the holder thereof, in whole or in part or (c) is convertible or exchangeable at the option of the holder thereof for Indebtedness or Disqualified Stock, on or prior to the earlier of, in the case of clause (a), (b) or (c) above, (i) 91 days after the then Latest Maturity Date and (ii) upon Payment In Full (provided that only the portion of Equity Interests which is mandatorily redeemable or matures or is redeemable at the option of the holder thereof prior to such date will be deemed to be Disqualified Stock), in each case other than in exchange for Equity Interests of the Borrower (other than Disqualified Stock).
Notwithstanding the preceding sentence:
(1) any Equity Interests that would constitute Disqualified Stock solely because the holders thereof have the right to require the Borrower to repurchase such Equity Interests upon the occurrence of a change of control or an asset disposition will not constitute Disqualified Stock if such Equity Interests provide that the issuer thereof will not redeem any such Equity Interests pursuant to such provisions prior to the repayment in full of the Obligations (other than unasserted contingent obligations);
(2) any Equity Interests issued to any plan for the benefit of employees of the Borrower or its Subsidiaries or by any such plan to such employees, such Equity Interests shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Borrower or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations; and
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(3) any Equity Interests held by any future, current or former employee, director, manager or consultant (or their respective trusts, estates, investment funds, investment vehicles or immediate family members) of the Borrower or any of its Subsidiaries, in each case upon the termination of employment or death of such person pursuant to any stock option plan or any other management or employee benefit plan or agreement shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Borrower or its Subsidiaries.
“Documentation Agent” means the entity listed as Documentation Agent on the cover page to this Agreement.
“Dollars,” “U.S. Dollars” and the symbol “$” shall each mean lawful money of the United States of America.
“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clause (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway, or any other country that is a member of the European Economic Area.
“EEA Resolution Authority” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Electronic Signature” shall have the meaning assigned thereto in Section 11.10 [Counterparts; Integration; Effectiveness].
“Eligibility Date” shall mean, with respect to each Loan Party and each Swap, the date on which this Agreement or any other Loan Document becomes effective with respect to such Swap (for the avoidance of doubt, the Eligibility Date shall be the effective date of such Swap if this Agreement or any other Loan Document is then in effect with respect to such Loan Party, and otherwise it shall be the Closing Date).
“Eligible Contract Participant” shall mean an “eligible contract participant” as defined in the Commodity Exchange Act and regulations thereunder.
“Environment” shall mean ambient air, indoor air, surface water, groundwater, drinking water, land surface and sub-surface strata and natural resources such as wetlands, flora and fauna.
“Environmental Laws” shall mean any and all applicable current and future federal, state, local and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or other governmental restrictions or common law causes of action relating to (a) protection of the Environment or to emissions, discharges, Releases or threatened Releases of Hazardous Materials, (b) human health as affected by Hazardous Materials, or (c)
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mining operations and activities to the extent relating to protection of the Environment or reclamation, including the Surface Mining Control and Reclamation Act or to occupational or miner health and safety, provided that “Environmental Laws” do not include any laws relating to worker or retiree benefits, including benefits arising out of occupational diseases.
“Environmental Liability” shall mean any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities) directly or indirectly resulting from or based upon (a) actual or alleged violation of any Environmental Law, (b) the generation, use, handling, transportation, storage or treatment of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release or threatened Release of any Hazardous Materials or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“Equity Interests” of any Person shall mean (1) any and all Capital Stock of such Person and (2) all rights to purchase, warrants or options (whether or not currently exercisable), participations or other equivalents of or interests in (however designated) such Capital Stock of such Person, but excluding from all of the foregoing any debt securities exercisable for, exchangeable for or convertible into Equity Interests, regardless of whether such debt securities include any right of participation with Equity Interests.
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended or supplemented from time to time, and any successor statute of similar import, and the rules and regulations thereunder, as from time to time in effect.
“ERISA Affiliate” shall mean, at any relevant time, any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).
“ERISA Event” shall mean (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification to the Borrower or any ERISA Affiliate that a Multiemployer Plan is insolvent or in reorganization within the meaning of Title IV of ERISA or experienced a mass withdrawal within the meaning of Section 4219 of ERISA; (d) the filing of a notice of intent to terminate a Pension Plan, or the treatment of a plan amendment as a termination of a Pension Plan or a Multiemployer Plan under Sections 4041 or 4041A of ERISA, respectively; (e) the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (f) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (g) the determination that any Pension Plan is considered an at-risk plan within the meaning of Section 430 of the Code or Section 303 of ERISA; (h) Borrower or an ERISA Affiliate is informed that any Multiemployer Plan to which Borrower or the ERISA Affiliate contributes is in endangered or critical status within the meaning of Section 432 of the Code or Section 305 of ERISA; (i) the failure by the Borrower or any ERISA Affiliate to meet all applicable requirements under the Pension Funding Rules in respect of a Pension Plan, whether or not waived, or a failure by the Borrower or any ERISA Affiliate to make any required contribution to a Multiemployer Plan; or (j) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon Borrower or any ERISA Affiliate.
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“Erroneous Payment” shall have the meaning specified in Section 10.15(a) [Certain Payments].
“Erroneous Payment Notice” shall have the meaning specified in Section 10.15(b) [Certain Payments].
“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.
“Event of Default” shall mean any of the events described in Section 9.1 [Events of Default] and referred to therein as an “Event of Default.”
“Excess Balance Sheet Cash” shall mean, as of any date of determination, Balance Sheet Cash as of such date minus, to the extent included in Balance Sheet Cash and without duplication, each of the following:
(i) to the extent the payment of such amounts are not prohibited by this Agreement, amounts in respect of which the Borrower or any Restricted Subsidiary has issued checks or has initiated wires or ACH transfers to Persons that are not Affiliates of a Loan Party but have not yet been subtracted from the balance in the relevant account of the Borrower or any Restricted Subsidiary;
(ii) any amounts of the Borrower and its Restricted Subsidiaries constituting pledges and/or deposits securing any binding and enforceable purchase and sale agreement with any Persons who are not Affiliates of a Loan Party, in each case to the extent permitted by this Agreement;
(iii) amounts in Deposit Accounts described in clause (i) (to the extent constituting amounts for employee wage and benefit payments and accrued and unpaid employee compensation (including salaries, wages, bonuses, benefits and expense reimbursements), in each case to the extent then due and owing or due and owing within five (5) Business Days of such date), (ii) or (iii) of the definition of “Excluded Account”;
(iv) cash deposited with (x) any Issuing Lender to cash collateralize Letters of Credit in accordance with this Agreement or (y) any issuing lender under a Qualified Receivables Transaction to cash collateralize letters of credit issued thereunder;
(v) any cash allocated for, reserved or otherwise set aside to pay production taxes, royalty obligations, vendor payments and lease payments or similar payments as are customary in the coal industry, of the Borrower or any Restricted Subsidiary then due and owing to third parties (or to be due and owing to third parties within five (5) Business Days of such date) and for which the Borrower or such Restricted Subsidiary either (x) has issued checks or has initiated wires or ACH transfers or (y) reasonably anticipates in good faith that it will issue checks or initiate wires or ACH transfers within five (5) Business Days of such date; and
(vi) any cash allocated for, reserved or otherwise set aside to make regularly scheduled payments of principal of, and interest on, Indebtedness due within thirty (30) days of such date to the extent otherwise permitted by this Agreement; and
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(vii) cash constituting net proceeds from the incurrence of Indebtedness in respect of revenue bonds issued by any Official Body, to the extent and so long as the use of such proceeds is restricted by the documentation governing such Indebtedness.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
“Excluded Account” shall mean a Deposit Account (i) which is used solely for making payroll and withholding tax payments related thereto and other employee wage and benefit payments and accrued and unpaid employee compensation (including salaries, wages, bonuses, benefits and expense reimbursements), (ii) which is used solely for paying or remitting taxes, including sales taxes, (iii) which is used solely as an escrow account or as a fiduciary or trust account, in each case, for the benefit of unaffiliated third parties, (iv) zero-balance accounts, so long as the balance in such account is zero at the end of each Business Day or (v) the aggregate average daily balance in which (in each case determined for the most recently completed calendar month) does not at any time exceed $1,000,000; provided that the average daily balance in all Deposit Accounts referred to in this clause (v) shall not exceed $5,000,000.
“Excluded Assets” shall have the meaning specified in Section 8.1.17(b) [Collateral].
“Excluded Subsidiaries” shall mean (a) each Unrestricted Subsidiary, (b) each Foreign Subsidiary, CFC and each CFC Holdco, (c) each Immaterial Subsidiary, (d) each Receivables Subsidiary, (e) prior to the date that is twelve (12) months after the Amendment No. 6 Effective Date (as such date may be extended by the Borrower so long as there shall have been executed by all parties thereto a definitive agreement to Dispose all of the Equity Interests in, or all assets of, such Powder River Basin Entity, until the date such agreement has been consummated or such transaction or such definitive agreement has expired or been terminated), any Powder River Basin Entity, (f) each Restricted Subsidiary of the Borrower that is not directly or indirectly wholly-owned by the Borrower and (g) CONSOL Innovations, so long as CONSOL Innovations does not hold any coal or mining assets; provided that (i) a Restricted Subsidiary that is a Loan Party shall not become an Excluded Subsidiary by virtue of a transfer of a portion of the equity in such Restricted Subsidiary (except pursuant to a bona fide joint venture transaction permitted hereunder) until a majority of the Equity Interests in such Restricted Subsidiary are Disposed of in accordance with the provisions of Section 8.2.4 [Loans and Investments] or Section 8.2.7 [Dispositions] and (ii) in no event shall any owner of any portion of the Required Collateral be an Excluded Subsidiary. Notwithstanding the foregoing, any Person that is an obligor or guarantor under any Indebtedness permitted under Section 8.2.1(i) or (m) [Indebtedness] shall not be an Excluded Subsidiary and, if not already a Guarantor, shall become a Guarantor pursuant to Section 8.1.9 [Additional Guarantors].
“Excluded Swap Obligation” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an Eligible Contract Participant at the time the Guaranty of such Guarantor or the grant by such Guarantor of a security interest becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps of such Guarantor for which such Guaranty or security interest is or becomes illegal.
“Excluded Taxes” shall mean, with respect to any Agent, any Lender, any Issuing Lender or any other recipient of any payment to be made by or on account of any obligation of any Loan Party hereunder or under any other Loan Document, (a) Taxes imposed on or measured by such recipient’s net income or profits (however denominated), and franchise Taxes imposed on it (in lieu of net income
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Taxes), by a jurisdiction (or any political subdivision thereof) as a result of such recipient being organized or having its principal office located or, in the case of any Lender, applicable lending office in such jurisdiction or that are Other Connection Taxes, (b) any branch profits Taxes imposed under section 884(a) of the Code, or any similar Tax, imposed by any jurisdiction described in clause (a) above, (c) in the case of a Lender, any U.S. federal withholding Tax that is imposed on amounts payable to such Lender pursuant to a Law in effect at the time such Lender becomes a party hereto (other than pursuant to an assignment request by the Borrower made under Section 5.6.2 [Replacement of Lender]) or designates a new lending office, except, in each case, to the extent that such Lender (or its assignor, as applicable) was entitled, immediately prior to the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding Tax pursuant to Section 5.9.1 [Payments Free of Taxes], (d) any withholding Tax attributable to such Lender’s failure to comply with Section 5.9.5 [Status of Lenders] and (e) any Tax imposed pursuant to FATCA.
“Existing Class” shall mean a Class of Existing Term Loans or a Class of Existing Revolving Credit Commitments.
“Existing Letter of Credit” shall mean the Letters of Credit set forth on Schedule 1.1(C).
“Existing Revolving Credit Commitments” shall have the meaning set forth in Section 2.12(b) [Extended Term Loans and Extended Revolving Credit Commitments].
“Existing Term Loans” shall have the meaning set forth in Section 2.12(a) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extended Class” shall mean a Class of Extended Term Loans or a Class of Extended Revolving Credit Commitments.
“Extended Revolving Credit Commitments” shall have the meaning set forth in Section 2.12(b) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extended Term Commitment” shall mean as to any Lender its commitment to provide Extended Term Loans pursuant to Section 2.12 [Extended Term Loans and Extended Revolving Credit Commitments].
“Extended Term Loans” shall have the meaning set forth in Section 2.12(a) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extending Lender” shall have the meaning set forth in Section 2.12(c) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extension Effective Date” shall have the meaning set forth in Section 2.12(c) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extension Election” shall have the meaning set forth in Section 2.12(c) [Extended Term Loans and Extended Revolving Credit Commitments].
“Extension Request” shall mean a Revolving Extension Request or a Term Extension Request.
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“Fair Market Value” shall mean the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involving distress or necessity of either party, determined in good faith by the Board of Directors of the Borrower in the case of amounts of at least the Threshold Amount and otherwise by a Responsible Officer, any such determination being conclusive for all purposes under this Agreement. In determining the Fair Market Value of any Real Property, a subsurface interest of a Loan Party shall be deemed part of the same Real Property as other subsurface interests of such Loan Party or other Loan Parties when such subsurface interest is, or could reasonably be, part of the same operating complex as such other subsurface interests.
“FATCA” shall mean Sections 1471 through 1474 of the Code as of the date hereof (and any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to the current Section 1471(b)(1) of the Code (and any amended or successor version described above), and any intergovernmental agreements (and any related laws or official administrative guidance) implementing the foregoing.
“Federal Funds Effective Rate” for any day shall mean the rate per annum (based on a year of 360 days and actual days elapsed and rounded upward to the nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted average of the rates on overnight federal funds transactions on the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor) in substantially the same manner as such Federal Reserve Bank computes and announces the weighted average it refers to as the “Federal Funds Effective Rate” as of the date of this Agreement; provided, if such Federal Reserve Bank (or its successor) does not announce such rate on any day, the “Federal Funds Effective Rate” for such day shall be the Federal Funds Effective Rate for the last day on which such rate was announced. Notwithstanding anything to the contrary set forth above, in the event the rate determined pursuant to the preceding sentence shall be less than zero, then (for the avoidance of doubt) the Federal Funds Effective Rate shall be deemed to be zero for purposes of this Agreement.
“Federal Funds Open Rate” for any day shall mean the rate per annum (based on a year of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other substitute Bloomberg Screen that displays such rate), or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen), as set forth on such other recognized electronic source used for the purpose of displaying such rate as selected by the Administrative Agent (for the purposes of this definition only, an “Alternate Source”) or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error); provided, however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the immediately preceding Business Day. If and when the Federal Funds Open Rate changes, the rate of interest with respect to any advance to which the Federal Funds Open Rate applies will change automatically without notice to the Borrower, effective on the date of any such change.
“Finance Co.” shall mean any direct, wholly-owned Subsidiary of the Borrower incorporated to become or otherwise serving as a co-issuer or co-borrower of Indebtedness permitted by this Agreement, which Subsidiary meets the following conditions at all times: (a) the provisions of Section 8.1.9 [Additional Guarantors] have been complied with in respect of such Subsidiary, and such Subsidiary is a Restricted Subsidiary and a Loan Party, (b) such Subsidiary shall be a domestic Subsidiary that is a corporation, and (c) such Subsidiary does not (i) incur, directly or indirectly any Indebtedness or any other obligation or liability whatsoever other than Indebtedness of the Borrower for which it serves as co-issuer or co-borrower, (ii) engage in any business, activity or transaction, or own any property, assets or
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Equity Interests, other than (A) performing its obligations and activities incidental to the co-issuance or co-borrowing of Indebtedness of the Borrower and (B) other activities incidental to the maintenance of its existence, including legal, tax and accounting administration, (iii) consolidate with or merge with or into any Person, or (iv) fail to hold itself out to the public as a legal entity separate and distinct from all other Persons.
“Financial Covenants” shall mean the covenants set forth in Section 8.2.13 [Financial Covenants].
“Financial Projections” shall have the meaning assigned to that term in Section 6.9(b) [Financial Projections].
“First Lien Gross Leverage Ratio” shall mean, as of any date of determination, the ratio of (without duplication): (A) (x) Consolidated First Lien Debt as of such date to (B) Consolidated EBITDA of the Borrower and the Restricted Subsidiaries for the period of four fiscal quarters of the Borrower most recently ended on or prior to the date of determination.
“Flood Laws” shall mean (i) the National Flood Insurance Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto, (iii) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto, and (iv) all other applicable Laws relating to policies and procedures that address requirements placed on federally regulated lenders relating to flood matters, in each case, as now or hereafter in effect or any successor statute thereto.
“Foreign Lender” shall mean any Lender that is not a “United States person” as defined in section 7701 of the Code.
“Foreign Subsidiaries” shall mean, for any Person, each Subsidiary of such Person that is incorporated or organized under the laws of any jurisdiction other than the United States of America, any state thereof or the District of Columbia.
“GAAP” shall mean generally accepted accounting principles as are in effect from time to time, subject to the provisions of Section 1.3 [Accounting Principles], and applied on a consistent basis both as to classification of items and amounts.
“Guarantor” shall mean each of the parties to this Agreement that is designated as a “Guarantor” on the signature page hereof and each other Person that joins this Agreement as a Guarantor after the date hereof, in each case, until such Person ceases to be a Guarantor in accordance with this Agreement.
“Guarantor Joinder” shall mean a joinder by a Person as a Guarantor under the Loan Documents in the form of Exhibit 1.1(G)(1).
“Guaranty” of any Person shall mean any obligation of such Person guarantying or in effect guarantying any liability or obligation of any other Person in any manner, whether directly or indirectly, including any agreement to indemnify or hold harmless any other Person, any performance bond or other suretyship arrangement and any other form of assurance against loss, including letters of credit issued for the account of Persons other than Loan Parties, except endorsement of negotiable or other instruments for deposit or collection in the ordinary course of business. “Guarantied” shall have a correlative meaning.
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“Guaranty Agreement” shall mean the Continuing Agreement of Guaranty and Suretyship in substantially the form of Exhibit 1.1(G)(2) executed and delivered by the Borrower and each of the Guarantors.
“Hazardous Materials” shall mean (i) any explosive substances or wastes and (ii) any chemicals, pollutants or contaminants, substances, materials or wastes, in any form, regulated under, or that could reasonably be expected to give rise to liability under, any applicable Environmental Law, including asbestos and asbestos containing materials, polychlorinated biphenyls, urea-formaldehyde insulation, mining waste (including tailings), gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any Coal Gas, coal ash, coal combustion by-products or waste, boiler slag, scrubber residue or flue desulphurization residue.
“Hedging Obligations” of any Person shall mean the obligations of such Person pursuant to any Swap Agreement.
“Historical Statements” shall have the meaning specified in Section 6.9(a) [Historical Statements].
“Hydrocarbon Swap Agreement” shall mean any cap, floor, collar, exchange transaction, hedging contract, forward contract, swap agreement, futures contract, call or put option or any other similar agreement or other exchange or protection agreement relating to Hydrocarbons or power or any other inputs in the production or processing processes for Hydrocarbons (specifically excluding contracts entered into in the ordinary course of business for the future sale and delivery of commodities, including but not limited to take-or-pay contracts).
“Hydrocarbons” shall mean coal, oil, natural gas, casing head gas, drip gasoline, natural gasoline, diesel, condensate, distillate, liquid hydrocarbons, gaseous hydrocarbons and all constituents, elements or compounds thereof and products refined or processed therefrom.
“Immaterial Real Property” shall mean Real Property (other than coal reserves) with a Fair Market Value less than $10,000,000.
“Immaterial Subsidiary” shall mean as of any date, any Restricted Subsidiary that does not (i) have assets having an aggregate book value, as of the end of the most recently ended fiscal year of the Borrower, exceeding $10,000,000 or Consolidated Net Income exceeding $5,000,000 for the most recently ended fiscal year of the Borrower, in each case, that is certified in the Perfection Certificate delivered as of the Closing Date or shown in the most recently delivered Compliance Certificate; (ii) have, in the aggregate with all other Immaterial Subsidiaries existing as of such date, (A) assets having an aggregate book value, as of the end of the most recently ended fiscal year of the Borrower, exceeding $25,000,000 or (B) Consolidated Net Income exceeding $10,000,000 for the most recently ended fiscal year of the Borrower, in each case, as shown in the most recently delivered combined or consolidated annual financial statements of the Borrower; provided that, solely with respect to any Restricted Subsidiary that has been acquired or created by the Borrower or any of its Restricted Subsidiaries subsequent to the Closing Date or the most recently delivered Compliance Certificate, (x) the assets and Consolidated Net Income determinations set forth in clauses (i) and (ii) shall be made by the Borrower based on information concerning such Restricted Subsidiary that is reasonably available to the Borrower at the date of determination and (y) the certification referred to in clause (i) above may take the form of an Officer’s
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Certificate delivered to the Administrative Agent at any time during the fiscal year in which such Restricted Subsidiary was acquired or created (as applicable) and subsequent to the Closing Date or the most recently delivered Compliance Certificate; provided, further, that if any of the thresholds in clause (i) or (ii) would be exceeded, the Borrower shall give written notice to the Administrative Agent that Subsidiaries specified in such notice shall no longer be deemed Immaterial Subsidiaries so that none of the thresholds in clause (i) or (ii) shall be exceeded (and, with respect to any such Subsidiary that no longer shall be an Immaterial Subsidiary and that is otherwise not an Excluded Subsidiary, such Subsidiary shall become a Guarantor pursuant to the provisions pursuant to the provisions of Section 8.1.9 [Additional Guarantors]); or (iii) directly or indirectly Guaranty or otherwise provide credit support for any Indebtedness of a Loan Party. For the avoidance of doubt, the designation of a Restricted Subsidiary pursuant to an Officer’s Certificate in accordance with the first proviso to the immediately preceding sentence shall not be required to include a recertification with respect to Restricted Subsidiaries designated as Immaterial Subsidiaries in the Perfection Certificate delivered as of the Closing Date or as shown the most recently delivered Compliance Certificate.
“Incremental Effective Date” shall have the meaning specified in Section 2.11.1 [Establishment of Incremental Facilities].
“Incremental Facilities” shall have the meaning assigned to such term in Section 2.11.1 [Establishment of Incremental Facilities].
“Incremental Lender” shall mean any Person that provides an Incremental Facility.
“Incremental Term Lender” shall mean any Person with an Incremental Term Loan Commitment.
“Incremental Term Loan Commitment” shall have the meaning assigned to such term in Section 2.11.1 [Establishment of Incremental Facilities].
“Incremental Term Loans” shall mean term loans established pursuant to an Incremental Term Loan Commitment.
“Indebtedness” shall mean, with respect to any Person on any date of determination (without duplication):
(1) the principal of and premium (if any) in respect of (a) indebtedness of such Person for money borrowed, (b) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable and (c) cash borrowings under any Qualified Receivables Transaction;
(2) all Capital Lease Obligations of such Person;
(3) all obligations of such Person issued or assumed as the deferred purchase price of property (which purchase price is due more than six months after the date of taking delivery of title to such property), including all obligations of such Person for the deferred purchase price of property under any title retention agreement (but excluding trade accounts payable arising in the ordinary course of business);
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(4) all obligations of such Person for the reimbursement of any obligor on any letter of credit, bankers’ acceptance or similar credit transaction (other than obligations with respect to letters of credit securing obligations (other than obligations described in clauses (1) through (3) of this paragraph) entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the first Business Day following receipt by such Person of a demand for reimbursement following payment on the letter of credit);
(5) Hedging Obligations; and
(6) all obligations of the type referred to in clauses (1) through (5) of this paragraph of other Persons and all dividends of other Persons with respect to Preferred Stock and Disqualified Stock for the payment of which, in either case, such Person is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise, including by means of any Guaranty.
The “amount” or “principal amount” of any Indebtedness or Disqualified Stock or other Preferred Stock outstanding at any time of determination as used herein shall be as set forth below or, if not set forth below, determined in accordance with GAAP:
(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any other Indebtedness;
(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of: (a) the Fair Market Value of such assets at the date of determination; and (b) the amount of the Indebtedness of the other Person;
(4) in the case of any Capital Lease Obligation, the amount determined in accordance with the definition thereof;
(5) in the case of any Preferred Stock, (a) if other than Disqualified Stock, the greater of its voluntary or involuntary liquidation preference and its maximum fixed redemption price or repurchase price or (b) if Disqualified Stock, as specified in the definition thereof;
(6) in the case of any Swap Agreements permitted by Section 8.2.1(f) [Indebtedness], zero;
(7) in the case of all other unconditional obligations, the amount of the liability thereof determined in accordance with GAAP;
(8) in the case of all other contingent obligations, the maximum liability at such date of such Person; and
(9) in the case of a Qualified Receivables Transaction, solely the aggregate amount of cash borrowings thereunder.
For purposes of determining any particular amount of Indebtedness, Guaranties of, or obligations in respect of letters of credit relating to, Indebtedness otherwise included in the determination of such amount shall not also be included to the extent that such inclusion would represent a double-counting of such Indebtedness. If Indebtedness is secured by a letter of credit that serves only to secure such Indebtedness, then the total amount deemed incurred shall be equal to the greater of (a) the principal of such Indebtedness and (b) the amount that may be drawn under such letter of credit.
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None of the following shall constitute Indebtedness:
(1) Indebtedness arising from agreements providing for indemnification or adjustment of purchase price or from Guaranties securing any obligations of the Borrower or any of its Subsidiaries pursuant to such agreements, incurred or assumed in connection with the disposition of any business, assets or Subsidiary of the Borrower, other than Guaranties or similar credit support by the Borrower or any of its Subsidiaries of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition;
(2) obligations to pay accrued expenses, any trade payables or other similar liabilities to trade creditors and other accrued current liabilities incurred in the ordinary course of business as the deferred purchase price of property;
(3) any liability for Federal, state, local or other taxes owed or owing by such Person;
(4) obligations to pay royalties and other amounts due in the ordinary course of business to royalty and working interest owners;
(5) obligations arising from Guaranties to suppliers, lessors, licensees, contractors, franchisees or customers incurred in the ordinary course of business;
(6) obligations (other than express Guaranties of Indebtedness for borrowed money) in respect of Indebtedness of other Persons arising in connection with (a) trade acceptances and (b) endorsements of instruments for deposit in the ordinary course of business;
(7) obligations 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 obligation is extinguished within two Business Days of its incurrence;
(8) obligations in respect of any obligations under workers’ compensation laws and similar legislation;
(9) any unrealized losses or charges in respect of Hedging Obligations (including those resulting from the application of FASB ASC 815);
(10) Indebtedness consisting of the financing of insurance premiums in customary amounts consistent with the operations and business of the Borrower and the Restricted Subsidiaries;
(11) any repayment or reimbursement obligation of such Person or any Restricted Subsidiary with respect to Customary Recourse Exceptions, unless and until an event or circumstance occurs that triggers the Person’s or such Restricted Subsidiary’s direct repayment or reimbursement obligation (as opposed to contingent or performance obligations) to the lender or other Person to whom such obligation is actually owed, in which case the amount of such direct payment or reimbursement obligation shall constitute Indebtedness; and
(12) earn-out obligations in respect of Consideration in an acquisition permitted hereunder until such obligations would be required to be reflected on a balance sheet in accordance with GAAP (provided that the amount of such earn-out obligations reflected on a balance sheet shall be counted in the Consideration at such time).
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“Indemnified Taxes” shall mean (a) all Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a) above, all Other Taxes.
“Indemnitee” shall have the meaning specified in Section 11.3.2 [Indemnification by the Borrower].
“Indemnity” shall mean the Regulated Substances Certificate and Indemnity Agreement, in substantially the form of Exhibit 1.1(I)(1), executed and delivered by each of the Loan Parties to the Administrative Agent for the benefit of the Secured Parties.
“Information” shall mean all information received from the Loan Parties or any of their Subsidiaries relating to the Loan Parties or any of such Subsidiaries or any of their respective businesses, other than any such information that is available to any Agent, any Lender or any Issuing Lender on a non-confidential basis prior to disclosure by the Loan Parties or any of their Subsidiaries.
“Insolvency Proceeding” shall mean, with respect to any Person, (a) a case, action or proceeding with respect to such Person (i) before any court or any other Official Body under any bankruptcy, insolvency, reorganization or other similar Law now or hereafter in effect, or (ii) for the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar official) of any Loan Party or otherwise relating to the liquidation, dissolution, winding-up or relief of such Person, or (b) any general assignment for the benefit of creditors, composition, marshaling of assets for creditors, or other, similar arrangement in respect of such Person’s creditors generally or any substantial portion of its creditors undertaken under any Law.
“Intercompany Subordination Agreement” shall mean the Subordination Agreement among the Loan Parties and the Restricted Subsidiaries, dated as of the Closing Date, in substantially the form of Exhibit 1.1(I)(2), executed and delivered by the Loan Parties and the Restricted Subsidiaries.
“Intercreditor Agreements” shall mean, collectively, the Junior Lien Intercreditor Agreement and the Pari Passu Intercreditor Agreement.
“Interest Coverage Ratio” shall mean, on any date of determination, the ratio of (1) Consolidated EBITDA of the Borrower and the Restricted Subsidiaries for the most recently ended four quarter period ending on or prior to such date to (2) Consolidated Cash Interest Expense for such corresponding four quarter period.
“Interest Period” shall mean the period of time selected by the Borrower in connection with (and to apply to) any election permitted hereunder by the Borrower to have Loans bear interest under the Term SOFR Rate Option. Subject to the last sentence of this definition, such period shall be, in each case, subject to the availability thereof, one month, three months or six months. Such Interest Period shall commence on the effective date of such Term SOFR Rate Option, which shall be (i) the Borrowing Date if the Borrower is requesting new Loans or (ii) the date of renewal of or conversion to the Term SOFR Rate Option if the Borrower is renewing or converting to the Term SOFR Rate Option applicable to outstanding Loans. Notwithstanding the second sentence hereof: (a) any Interest Period which would otherwise end on a date which is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) the Borrower shall not select, convert to or renew an Interest Period for any portion of any Loans that would end after the Maturity Date of such Loans and (c) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.
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“Interest Rate Agreement” shall mean any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement relating to fluctuations in interest rates.
“Interest Rate Option” shall mean any Term SOFR Rate Option or Base Rate Option or, solely with respect to Swing Loans, the Daily Simple SOFR Option.
“Investment” in any Person shall mean any (1) direct or indirect advance, loan or other extensions of credit (including by way of Guaranty or similar arrangement), or capital contribution to such Person (including any transfer of cash or other property to others or any payment for property or services for the account or use of others but excluding (a) advances to customers and contract miners or joint interest partners in the ordinary course of business that are recorded as accounts receivable on the balance sheet of the lender, and (b) trade payables and extensions of trade credit on commercially reasonable terms in accordance with normal trade practices), (2) all items that are or would be classified as investments on a balance sheet or (3) any purchase or acquisition of Capital Stock, Indebtedness or other similar securities issued by such Person. Except as otherwise provided for in this Agreement, the amount of an Investment shall be its Fair Market Value at the time the Investment is made and without giving effect to subsequent changes in value. If the Borrower or any Restricted Subsidiary sells or otherwise Disposes of any Capital Stock of any Restricted Subsidiary, or any Restricted Subsidiary issues any Capital Stock, in either case, such that, after giving effect to any such sale or Disposition, such Person is no longer a Subsidiary, the Borrower shall be deemed to have made an Investment on the date of any such sale or other disposition equal to the Fair Market Value of the Capital Stock of and all other Investments in such Person retained.
For purposes of Section 8.2.4 [Loans and Investments] with respect to Investments in Unrestricted Subsidiaries:
(1) “Investment” shall include the portion (proportionate to the Borrower’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of any Subsidiary of the Borrower at the time that such Subsidiary is designated an Unrestricted Subsidiary; and upon a redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, the aggregate amount of Investments outstanding under Section 8.2.4(h) [Loans and Investments] shall be reduced (but not below zero) by an amount equal to the Fair Market Value of the Borrower’s proportionate interest in such Subsidiary immediately following such redesignation; and
(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer.
“IRS” shall mean the Internal Revenue Service.
“ISP” shall mean, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance of such Letter of Credit).
“Issuer Documents” shall mean with respect to any Letter of Credit, the Letter of Credit application, and any other document, agreement and instrument entered into by the applicable Issuing Lender and any Loan Party or in favor of the applicable Issuing Lender and relating to such Letter of Credit.
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“Issuing Lenders” shall mean each Revolving Lender (or Affiliate thereof designated as an Issuing Lender by such Revolving Lender); provided that neither City National Bank of West Virginia nor Burke & Herbert Bank shall be required to be an Issuing Lender.
“Joint Venture” shall mean any Person that is not a direct or indirect Subsidiary of the Borrower in which the Borrower or any Restricted Subsidiary makes any equity Investment.
“Junior Lien Intercreditor Agreement” shall mean (a) the Intercreditor Agreement dated as of the Closing Date, among the Collateral Agent and the CONSOL CRDA Bonds Trustee and (b) one or more junior lien intercreditor agreements in a form to be agreed among the Collateral Agent and, as applicable, the trustee or agent under any Indebtedness constituting Specified Junior Obligations.
“Labor Contracts” shall mean all employment agreements, employment contracts, collective bargaining agreements and other agreements among the Borrower or any Restricted Subsidiary and its employees.
“Latest Maturity Date” shall mean, at any date of determination, the latest Maturity Date applicable to any Loan or Commitment hereunder at such time, including after giving effect to any Additional Credit Extension Amendment.
“Law” shall mean any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, opinion, issued guidance, release, ruling, order, executive order, injunction, writ, decree, bond, judgment, authorization or approval, lien or award of or any settlement arrangement, by agreement, consent or otherwise, with any Official Body, foreign or domestic.
“LC Disbursement” shall mean a payment made by an Issuing Lender pursuant to a Letter of Credit issued by such Issuing Lender.
“Lead Arrangers” shall mean PNC Capital Markets LLC, Axos Bank, Burke & Herbert Bank, Dollar Bank, Federal Savings Bank, EverBank, N.A., First National Bank of Pennsylvania, KeyBank National Association, Manufacturers and Traders Trust Company, Northwest Bank and Regions Capital Markets, a division of Regions Bank, in their capacities as joint lead arrangers and joint bookrunners of the revolving credit facility hereunder.
“Lenders” shall mean the Revolving Lenders, the Swingline Lenders and the holders of any Class of Term Loans or Commitments established after the Amendment No. 6 Effective Date.
“Letter of Credit” shall have the meaning assigned to that term in Section 2.9.1(a) [Issuance of Letters of Credit] and shall include the Existing Letters of Credit.
“Letter of Credit Aggregate Sublimit” shall mean, at any time, the amount equal to 100% of the Revolving Credit Commitments at such time.
“Letter of Credit Fee” shall have the meaning assigned to that term in Section 2.9.2 [Letter of Credit Fees].
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“Letter of Credit Issuing Lender Sublimit” shall mean, with respect to each Issuing Lender, an amount equal to such Issuing Lender’s (or its designated Affiliate’s) Ratable Share of the Letter of Credit Aggregate Sublimit or, if lesser, the Revolving Credit Commitment of such Issuing Lender (or its Affiliate that is the Revolving Lender).
“Letter of Credit Maturity Date” shall mean the date which is 10 Business Days prior to the Revolving Maturity Date (assuming for this purpose that the Applicable Maturity Date is the earliest possible date that it may be pursuant to the definition thereof), but, as to any Letter of Credit issued or to be issued by any Issuing Lender, without giving effect to clause (y) of the definition of “Revolving Maturity Date” unless the applicable Additional Credit Extension Amendment has been consented to in writing by such Issuing Lender.
“Letter of Credit Obligations” shall mean, as of any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit on such date (if any Letter of Credit shall increase in amount automatically in the future, such aggregate amount available to be drawn shall currently give effect to any such future increase) plus the aggregate outstanding Reimbursement Obligations on such date. The Letter of Credit Obligations of any Revolving Lender at any time shall be its Ratable Share of the total Letter of Credit Obligations at such time. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.5 [Letter of Credit Amounts]. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.13 or Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.
“Lien” shall mean any mortgage, deed of trust, pledge, lien, security interest, charge or other similar encumbrance or security arrangement of any nature whatsoever, whether voluntarily or involuntarily given, including any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing), but shall not include any operating lease.
“LLC Interests” shall have the meaning specified in Section 6.3 [Subsidiaries].
“Loan Documents” shall mean this Agreement, the Administrative Agent’s Letter, the Guaranty Agreement, the Indemnity, the Intercompany Subordination Agreement, the Notes, the Security Documents and amendments, supplements, joinders or assignments to the foregoing and any other instruments, certificates or documents (expressly excluding any Other Lender Provided Financial Service Product, any Specified Swap Agreements or any other Swap Agreements) delivered or contemplated to be delivered hereunder or thereunder or in connection herewith or therewith, and Loan Document shall mean any of the Loan Documents.
“Loan Parties” shall mean the Borrower and the Guarantors.
“Loan Request” shall have the meaning specified in Section 2.5.1 [Loan Requests].
“Loans” shall mean the loans made to the Borrower under this Agreement.
“Margin Stock” shall have the meaning provided in Regulation U.
“Margin Stock Regulation” shall mean Regulation U, T or X as promulgated by the Board of Governors of the Federal Reserve System, as amended from time to time.
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“Material Acquisition/Disposition” shall mean any Investment, Permitted Acquisition or Disposition that involves (a) an acquisition or disposition of assets, the Fair Market Value of which assets exceeds $25,000,000 or (b) a change in Consolidated EBITDA that exceeds $10,000,000 per four fiscal quarter period.
“Material Adverse Change” shall mean any set of circumstances or events that (a) has or would reasonably be expected to have a material adverse effect on the business, properties, financial condition or results of operations of the Borrower and its Subsidiaries, taken as a whole, (b) has a material adverse effect on the ability of the Loan Parties to fully and timely pay the Obligations when due or (c) has or would reasonably be expected to have a material adverse effect on the validity or enforceability of the Loan Documents or the rights or remedies of the Agents or the Lenders thereunder.
“Maturity Date” shall mean with respect to the Revolving Credit Commitments, Swing Loans and Revolving Credit Loans of any Class, the applicable Revolving Maturity Date.
“Month,” with respect to an Interest Period under the Term SOFR Rate Option, shall mean the interval between the days in consecutive calendar months numerically corresponding to the first day of such Interest Period. If any Interest Period begins on a day of a calendar month for which there is no numerically corresponding day in the month in which such Interest Period is to end, the final month of such Interest Period shall be deemed to end on the last Business Day of such final month.
“Moody’s” shall mean Moody’s Investors Service, Inc. and its successors.
“Mortgages” shall mean collectively, (i) the mortgages or deeds of trust with respect to Real Property in which a security interest has been granted on the Closing Date (if any) and (ii) the mortgages or deeds of trust with respect to Real Property in which a security interest is granted after the Closing Date in substantially the form of Exhibit 1.1(M), in each case, executed and delivered by the applicable Loan Parties to the Collateral Agent to secure the Obligations, for the benefit of the Secured Parties, and “Mortgage” shall mean, individually, any of the Mortgages.
“Multiemployer Plan” shall mean any employee benefit plan which is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA and to which the Borrower or any ERISA Affiliate is then making or accruing an obligation to make contributions or, within the preceding five plan years, has made or had an obligation to make such contributions or has any ongoing obligation with respect to withdrawal liability (within the meaning of Title IV of ERISA).
“Non-Consenting Lender” shall have the meaning specified in Section 11.1.4 [Non-Consenting Lenders].
“Non-Extension Notice Date” shall have the meaning assigned to such term in Section 2.9.1(c) [Issuance of Letters of Credit].
“Non-Recourse Debt” shall mean, with respect to Indebtedness of any Unrestricted Subsidiary or Joint Venture, Indebtedness:
(1) as to which neither the Borrower nor any Restricted Subsidiary (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness) or (b) is directly or indirectly liable as a guarantor or otherwise, except for Customary Recourse Exceptions and except by the pledge of (or a Guaranty limited in recourse solely to) the Equity Interests of such Unrestricted Subsidiary or Joint Venture; and
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(2) as to which the lenders will not have any recourse to the Capital Stock or assets of the Borrower or any Restricted Subsidiary (other than the Equity Interests of such Unrestricted Subsidiary or Joint Venture), except for Customary Recourse Exceptions.
“Notes” shall mean Revolving Credit Notes, the Swing Loan Notes and the Term Notes.
“Obligation” shall mean any obligation or liability of any of the Loan Parties, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due (including interest, fees, premiums and other monetary obligations accruing and/or incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), under or in connection with (i) this Agreement, the Loans, the Notes, the Letters of Credit, the Administrative Agent’s Letter or any other Loan Document whether to any Agent, any Issuing Lender, any of the Lenders or their Affiliates or other Persons provided for under such Loan Documents, (ii) any Specified Swap Agreement (other than, with respect to any Guarantor that is not a Qualified ECP Loan Party, Excluded Swap Obligations of such Guarantor) or (iii) any Other Lender Provided Financial Service Product.
“OFAC” shall mean the United States Department of the Treasury’s Office of Foreign Assets Control.
“Officer’s Certificate” shall mean a certificate signed by an Authorized Officer of the Borrower.
“Official Body” shall mean the government of the United States of America or any other nation, or in each case any political subdivision thereof, whether state, local, county, provincial or otherwise, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank) and any group or body charged with setting financial accounting or regulatory capital rules or standards (including the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).
“Order” shall have the meaning specified in Section 2.9.9(b) [Liability for Acts and Omissions].
“Other Connection Taxes” shall mean, with respect to any recipient, Taxes imposed as a result of a present or former connection between such recipient and the jurisdiction imposing such Tax (other than connections arising from such recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to and/or enforced any Loan Document, or sold or assigned an interest in any Note or Loan Document).
“Other Lender Provided Financial Service Product” shall mean agreements or other arrangements under which any Agent, any Lender or Affiliate of any Agent or a Lender (or any Person that was an Agent or a Lender or Affiliate of an Agent or Lender at the time such agreement or arrangement was entered into) provides any of the following products or services to any of the Loan Parties: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) purchase cards, (e) ACH transactions, (f) cash management, including controlled disbursement, accounts or services, or (g) foreign currency exchange.
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“Other Taxes” shall mean all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 5.6.2 [Replacement of a Lender]).
“Pari Passu Intercreditor Agreement” shall mean one or more pari passu intercreditor agreements in a form to be agreed among the Collateral Agent and, as applicable, the Arch Tax Exempt Bonds Trustee or the trustee or agent under any Permitted Pari Passu Indebtedness.
“Participant” shall have the meaning specified in Section 11.8.4 [Participations].
“Participation Advance” shall have the meaning specified in Section 2.9.4(a) [Repayment of Participation Advances].
“Partnership Interests” shall have the meaning specified in Section 6.3 [Subsidiaries].
“Patent, Trademark and Copyright Security Agreement” shall mean the Patent, Trademark and Copyright Security Agreement, dated as of the Closing Date, executed and delivered by each of the Loan Parties to the Collateral Agent for the benefit of the Secured Parties.
“Payment Date” shall mean the first Business Day of each calendar quarter after the date hereof and on the Maturity Date for the applicable Loans or Commitments or upon termination of the Commitments.
“Payment In Full” and “Paid in Full” shall mean the payment in full in cash of the Loans and other Obligations (other than contingent indemnity obligations not then due) under the Loan Documents, termination of the Commitments and expiration or termination of all Letters of Credit (or with respect to any Letter of Credit with an expiration date that extends beyond the latest Revolving Maturity Date, the pledge of Cash Collateral for such Letter of Credit pursuant to Section 2.9.10 [Cash Collateral Prior to the Revolving Maturity Date]).
“PBGC” shall mean the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA or any successor.
“Pennsylvania Mining Complex” shall mean those certain coal mines in Greene and Washington Counties, Pennsylvania and Marshall County, West Virginia, commonly known as the Bailey Mine, the Enlow Fork Mine, the Harvey Mine, and the related preparation plant commonly known as the Bailey preparation plant.
“Pension Funding Rules” shall mean the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in Sections 412 and 430 of the Code and Sections 302 and 303 of ERISA.
“Pension Plan” shall mean any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA, that is subject to Title IV of ERISA or the Pension Funding Rules and is sponsored or maintained by Borrower or any ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064(a) of ERISA, has made contributions at any times during the immediately preceding five plan years.
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“Perfection Certificate” shall mean a certificate in the form of Exhibit 1.1(P)(1) or any other form reasonably acceptable to the Collateral Agent.
“Perfection Certificate Supplement” shall mean a certificate supplement in the form of Exhibit 1.1(P)(2) or any other form reasonably acceptable to the Collateral Agent.
“Permitted Acquisition” shall have the meaning assigned to such term in Section 8.2.6(b) [Liquidations, Mergers, Consolidations, Acquisitions]. For the avoidance of doubt, the consummation of the Arch Merger and the acquisition of the Arch Acquired Entities and other entities pursuant thereto shall be deemed to be a Permitted Acquisition.
“Permitted Arch Rollover Indebtedness” shall mean the Indebtedness of Arch and its Subsidiaries in existence immediately prior to the Amendment No. 6 Effective Date and identified as such on Schedule 8.2.1 [Existing Indebtedness].
“Permitted Business” shall mean the businesses conducted by the Borrower and its Subsidiaries on the Amendment No. 6 Effective Date and any activity that is ancillary or complementary to or necessary or desirable for, or otherwise reasonably related to, such businesses.
“Permitted Liens” shall mean:
(1) Liens existing on the Amendment No. 6 and described on Schedule 8.2.2;
(2) Liens securing the Obligations in favor of the Collateral Agent for the benefit of the Secured Parties;
(3) Liens on cash or Temporary Cash Investments securing Letter of Credit Obligations with respect to Letters of Credit that have an expiration date that extends beyond the Letter of Credit Maturity Date in favor of the applicable Issuing Lender of such Letters of Credit;
(4) Liens in favor of (a) the Borrower or a Guarantor or (b) by a Restricted Subsidiary that is not a Guarantor in favor of any other Restricted Subsidiary that is not a Guarantor;
(5) Liens on Collateral securing obligations in respect of Indebtedness incurred or outstanding pursuant to Section 8.2.1(h)(B) [Indebtedness] or 8.2.1(h)(D); provided that such Liens are subordinated to the Liens of the Collateral Agent on the Collateral securing the Obligations pursuant to the Intercreditor Agreements; provided further that (A) prior to the Arch Accession Date, other than pursuant to after-acquired assets clauses in the agreements governing such Indebtedness as in effect immediately prior to the Amendment No. 6 Effective Date, assets that did not secure the CONSOL BMT Bonds, the CONSOL CRDA Bonds or the Arch Tax Exempt Bonds may not secure Refinancing Indebtedness pursuant to Section 8.2.1(h)(D) in respect to the CONSOL BMT Bonds, the CONSOL CRDA Bonds or the Arch Tax Exempt Bonds, respectively, and (B) such Indebtedness shall not have any financial maintenance covenant.
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(6) Liens for taxes, assessments and governmental charges not yet delinquent or the validity of which are being contested in good faith by appropriate proceedings, promptly instituted and diligently conducted, and for which adequate reserves have been established to the extent required by GAAP as in effect at such time, and which proceedings (or orders entered in connection with such proceedings) have the effect of suspending the enforcement or collection of such Liens;
(7) Liens incurred to secure appeal bonds and judgment Liens not constituting an Event of Default or Potential Default, in each case in connection with litigation or legal proceedings that are being contested in good faith by appropriate proceedings;
(8) Liens upon real or personal property other than the Collateral, including any attachment of personal property or real property or other legal process prior to adjudication of a dispute on the merits, (a) if the validity or amount thereof is being contested in good faith by appropriate and lawful proceedings diligently conducted so long as levy and execution thereon have been stayed or bonded and continue to be stayed or bonded, (b) if a final judgment is entered and such judgment is discharged within thirty (30) days of entry, or (c) the payment of which is covered in full (subject to customary deductible) by insurance;
(9) inchoate Liens arising by operation of law;
(10) Liens securing Capital Lease Obligations, mortgage financings, equipment leases, purchase money obligations or other Indebtedness incurred pursuant to Section 8.2.1(d) [Indebtedness] and Capital Lease Obligations set forth on Schedule 8.2.1 [Existing Indebtedness]; provided that such Liens shall attach only to the property (a) acquired with the proceeds of such Indebtedness or (b) which is the subject of such Capital Lease Obligations;
(11) Liens on Collateral securing obligations in respect of Indebtedness incurred or outstanding pursuant to Section 8.2.1(i) [Indebtedness]; provided that, (a) in the case of Indebtedness incurred or outstanding pursuant to Section 8.2.1(i)(x), such Liens shall (i) be secured on a pari passu basis with the Obligations; (ii) secure Indebtedness in an amount not to exceed $100,000,000 in the aggregate; and (iii) be subject to the Pari Passu Intercreditor Agreement or another intercreditor agreement reasonably satisfactory to the Administrative Agent and the other debtholders required to become party thereto and (b) in the case of Indebtedness incurred or outstanding pursuant to Section 8.2.1(i)(z), such Liens (i) are subordinated to the Liens on the Collateral securing the Obligations pursuant to the Intercreditor Agreements and (ii) secure Indebtedness with an aggregate principal amount not to exceed the greater of (A) $150,000,000 and (B) 3.0% of CTA at such time;
(12) Liens on the Equity Interests of a Person that is not a Restricted Subsidiary to secure obligations of such Person;
(13) claims, Liens or encumbrances upon, and defects of title to, real or personal property, including any attachment of personal or real property or real property or other legal process prior to adjudication of a dispute on the merits, (a) if the validity or amount thereof is being contested in good faith by appropriate and lawful proceedings diligently conducted so long as levy and execution thereon have been stayed and continue to be stayed, (b) if a final judgment is entered and such judgment is discharged within thirty (30) days of entry, or (c) the payment of which is covered in full (subject to customary deductible) by insurance;
(14) precautionary filings under the UCC by a lessor with respect to personal property leased to such Person;
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(15) Liens on insurance policies and proceeds thereof, or other deposits, to secure insurance premium financings;
(16) Liens on Qualified Receivables Assets securing obligations under Indebtedness permitted by Section 8.2.1(j) [Indebtedness];
(17) Liens on cash or Temporary Cash Investments arising in connection with the defeasance, discharge or redemption of Indebtedness permitted hereunder;
(18) Liens securing obligations in respect of Indebtedness incurred or outstanding pursuant to Section 8.2.1(h)(C) [Indebtedness]; provided that (i) prior to the Arch Accession Date, such Liens shall be limited to the assets or property that secure such Indebtedness immediately prior to the Amendment No. 6 Effective Date or pursuant to after-acquired clauses, if applicable, in the Arch Tax Exempt Bonds Indenture or other documents governing such Indebtedness as in effect immediately prior to the Amendment No. 6 Effective Date and (ii) on and after the date the Arch Acquired Entities become Guarantors, such Liens shall only secure assets that constitute Collateral and such Indebtedness shall subordinated to the Liens securing the Obligations and pursuant to the Intercreditor Agreements;
(19) other Liens not otherwise permitted hereunder with respect to Indebtedness or other obligations that do not in the aggregate exceed at any one time outstanding the greater of (i) $50,000,000 and (ii) 1.0% of CTA at such time;
(20) Liens to renew, extend, refinance or refund a Lien referred to in clause (1) above; provided that (i) such new Lien shall be limited to all or part of the same property (including future improvements thereon and accessions thereto) subject to the original Lien and (ii) the obligations secured by such Lien at such time is not increased to any amount greater than the amount permitted by Refinancing Indebtedness;
(21) statutory and common law banker’s Liens and rights of setoff on bank deposits;
(22) option agreements and rights of first refusal granted with respect to assets that are permitted to be Disposed of pursuant to the terms of Section 8.2.7 [Dispositions];
(23) Liens securing Permitted Arch Rollover Indebtedness so long as the collateral securing such indebtedness is comprised of only collateral securing such indebtedness (including in respect of any proceeds, replacement renewal of and improvement and accession to such collateral, in each case so long as such proceeds, replacements, renewals, improvements and accessions are not of a different type of asset than such collateral, as determined in good faith by the Borrower, or any collateral pursuant to after-acquired property clauses in the agreements governing such indebtedness as in effect immediately prior to the Amendment No. 6 Effective Date, to the extent any such items secured or would have secured such indebtedness) immediately prior to the Arch Merger;
(24) any leases of assets permitted by Section 8.2.7 [Dispositions];
(25) [reserved];
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(26) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary use of such property;
(27) pledges, deposits or bonds made in the ordinary course of business to secure payment of reclamation liabilities or workers’ compensation, or to participate in any fund in connection with workers’ compensation, unemployment insurance or other social security programs (including pledges or deposits of cash securing letters of credit that secure payment of such workers’ compensation, unemployment insurance or other social security programs);
(28) Liens of mechanics, materialmen, warehousemen, carriers, or other like Liens (including any other statutory nonconsensual or common law Liens), securing obligations incurred in the ordinary course of business that are not yet due and payable and Liens of landlords securing obligations to pay lease payments that are not yet due and payable or in default (including pledges or deposits of cash securing letters of credit that secure such Liens of landlords securing obligations to make lease payments that are not yet due and payable or in default) or, with respect to any of the foregoing, that are being contested in good faith by appropriate proceedings and as to which appropriate reserves have been established in accordance with GAAP and which proceedings (or orders entered in connection with such proceedings) have the effect of suspending the enforcement or collection of such Liens;
(29) good-faith pledges or deposits made or other Liens granted in the ordinary course of business to secure performance of bids, tenders, contracts (other than for the repayment of borrowed money) or leases, not in excess of the aggregate amount due thereunder or other amounts as may be customary, or to secure statutory obligations, or surety, appeal, indemnity, performance or other similar bonds required in the ordinary course of business (including pledges or deposits of cash securing letters of credit that secure such performance of bids, tenders, contracts (other than for the repayment of borrowed money) or leases, not in excess of the aggregate amount due thereunder or other amounts as may be customary, or that secure such statutory obligations, or such surety, appeal, indemnity, performance or other similar bonds required in the ordinary course of business);
(30) Liens on cash and Temporary Cash Investments securing Indebtedness permitted by Section 8.2.1(f) [Indebtedness] in an aggregate amount not to exceed $25,000,000 at any one time outstanding; and
(31) deposits and escrows of cash pursuant to customary purchase price adjustment, indemnity or similar obligations under agreements related to acquisitions and Dispositions permitted hereunder;
provided that Permitted Liens shall not include any Liens on the Equity Interests of PA Mining Complex LP or PA Mining Complex GP LLC other than Liens pursuant to clauses (2) and (11) above.
“Permitted Pari Passu Indebtedness” shall mean (i) any Indebtedness that Refinances the CONSOL BMT Bonds, CONSOL CRDA Bonds and/or Arch Tax Exempt Bonds (in each case pursuant to this clause (i), to the extent that the CONSOL BMT Bonds, the CONSOL CRDA Bonds or Arch Tax Exempt Bonds, as the case may be, have not been Refinanced pursuant to 8.2.1(h)(D)) and (ii) other tax-exempt municipal bonds and revenue bonds, in an aggregate principal amount under clauses (i) and (ii) not to exceed $100,000,000 in the aggregate; provided that (i) such Indebtedness has a Stated Maturity no
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earlier than the Revolving Maturity Date, (ii) such Indebtedness shall not have any interim amortization payments, (iii) no Person that is a Restricted Subsidiary that is not a Guarantor shall be an obligor with respect to such Indebtedness, (iv) such Indebtedness is not secured by any asset of the Borrower or a Subsidiary of the Borrower that does not constitute Collateral, (v) the covenants and events of default applicable to such Indebtedness are not more onerous, taken as a whole, to the Borrower and its Subsidiaries than those contained in this Agreement, as determined by the Borrower in good faith, (vi) such Indebtedness is not subject to mandatory prepayments or mandatory offers to purchase other than those customary for high yield debt securities; (vii) such Indebtedness is subject to a valid and enforceable Pari Passu Intercreditor Agreement; provided, further, that notwithstanding clauses (ii), (v) and (vi), Indebtedness issued by any Official Body may contain (A) mandatory redemption or similar requirements upon customary tax or invalidity events as determined in good faith by the Borrower, (B) covenants (but not financial maintenance covenants) and (C) events of default and remedies, in each case, customary for Indebtedness of such type, as certified in good faith, after consultation with bond counsel, in an Officer’s Certificate delivered to the Administrative Agent prior to the incurrence of such Indebtedness.
“Permitted Unsecured Notes” shall mean any unsecured notes issued by the Borrower and/or Finance Co. in one or more transactions; provided that (i) no payment of principal in respect of such notes shall be required prior to six months after the Latest Maturity Date in effect at the time of issuance (except for customary offers to purchase with proceeds of asset sales or upon the occurrence of a change of control), (ii) such notes shall not include any financial maintenance covenants, and the covenants and events of default shall be customary for high yield debt securities, and (iii) no Subsidiary of the Borrower shall Guaranty such notes unless such Subsidiary is (or concurrently with any such Guaranty becomes) a Guarantor hereunder; provided, further, that notwithstanding clauses (i) and (ii), Indebtedness in respect of revenue bonds and tax-exempt municipal bonds issued by any Official Body may contain (A) in the case of revenue bonds, mandatory redemption or similar requirements upon certain tax or invalidity events and, in the case of tax-exempt municipal bonds, redemption or offer to purchase or interim amortization requirements solely related to customary sinking funds and customary tax or other customary invalidity events as determined in good faith by the Borrower, (B) covenants (but not financial maintenance covenants) and (C) events of default and remedies, in each case, customary for Indebtedness of such type, as certified in good faith, after consultation with bond counsel, in an Officer’s Certificate delivered to the Administrative Agent prior to the incurrence of such Indebtedness.
“Person” shall mean any individual, corporation, partnership, limited liability company, association, joint-stock company, trust, unincorporated organization, joint venture, Official Body, or any other entity.
“Pledged Securities” shall mean all of the property described as “Pledged Securities” in the Security Agreement.
“Pledgor” shall have the meaning set forth in the Security Agreement.
“PNC” shall mean PNC Bank, National Association, its successors and assigns.
“Potential Default” shall mean any event or condition which with notice or passage of time, or any combination of the foregoing, would constitute an Event of Default.
“Powder River Basin” means the coal mines of Arch as of the date of the Arch Merger constituting Black Thunder and Coal Creek.
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“Powder River Basin Entities” shall mean Ark Land LT LLC, Thunder Basin Coal Company, L.L.C. and Triton Coal Company LLC, so long each such Person owns only the Powder River Basin and no other assets (other than de minimis assets).
“Preferred Stock” shall mean, with respect to any Person, Capital Stock of such Person of any class or classes (however designated) which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over Capital Stock of any other class of such Person.
“Prime Rate” shall mean the interest rate per annum announced from time to time by the Administrative Agent at its Principal Office as its then prime rate, which rate may not be the lowest or most favorable rate then being charged to commercial borrowers or others by the Administrative Agent. Any change in the Prime Rate shall take effect at the opening of business on the day such change is announced.
“Principal Office” shall mean the main banking office of the Administrative Agent in Pittsburgh, Pennsylvania.
“Pro Forma Basis” shall mean:
(1) any Material Acquisition/Disposition and any dividend or distribution on, or repurchases or redemptions of, Capital Stock of the Borrower made or to be made by the Borrower or any Restricted Subsidiary during the applicable reference period or subsequent to such reference period and on or prior to the date of determination will be given pro forma effect as if it had occurred on the first day of the applicable reference period;
(2) any Person that is a Restricted Subsidiary on the date of determination will be deemed to have been a Restricted Subsidiary at all times during such reference period;
(3) any Person that is not a Restricted Subsidiary on the date of determination will be deemed not to have been a Restricted Subsidiary at any time during such reference period;
(4) other than for purposes of testing actual compliance with Section 8.2.13(c) [Minimum Interest Coverage Ratio] (but not when calculating compliance with a Financial Covenant on a Pro Forma Basis for determining the permissibility of any action, or the level of such Financial Covenant is used in reference to a test or covenant hereunder), Consolidated Cash Interest Expense shall be calculated after giving pro forma effect to incurrences and repayments of Indebtedness (other than ordinary course working capital borrowings and repayments under revolving credit facilities) during the applicable reference period or subsequent to such reference period and on or prior to the date of determination to the extent in connection with any transaction referred to in clause (1) above as if it had occurred on the first day of the applicable reference period; and
(5) if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the calculation date had been the applicable rate for the entire period (taking into account the effect on such interest rate of any Specified Swap Agreement applicable to such Indebtedness).
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For purposes of this definition, whenever pro forma effect is given to a transaction, the pro forma calculations shall be made in good faith by a Responsible Officer of the Borrower and in a manner consistent with Article 11 of Regulation S-X of the Securities Act (as such Regulation S-X was in effect prior to January 1, 2021), as set forth in a certificate of an Authorized Officer of the Borrower (with supporting calculations) and reasonably acceptable to the Administrative Agent. For purposes of making the computation referred to above, interest on any Indebtedness under a revolving credit facility (to the extent required to be computed on a pro forma basis) shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Borrower may designate. For the avoidance of doubt, the Interest Coverage Ratio for purposes of compliance with Section 8.2.13(c) [Minimum Interest Coverage Ratio] shall not be calculated on a Pro Forma Basis.
“Properties” shall have the meaning assigned to such term in Section 6.25(b) [Environmental Matters].
“PTE” shall mean a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
“QFC Credit Support” shall have the meaning assigned to such term in Section 11.17 [Acknowledgement Regarding Any Supported QFCs].
“Qualified ECP Loan Party” shall mean each Loan Party that on the Eligibility Date is (a) an Eligible Contract Participant (after giving effect to Section 22 of the Guaranty Agreement and any and all other Guaranties of such Guarantor’s Swap Obligations by the Borrower and any other Guarantor), or (b) an Eligible Contract Participant that can cause another Person to qualify as an Eligible Contract Participant on the Eligibility Date under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act by entering into or otherwise providing a “letter of credit or keepwell, support, or other agreement” for purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
“Qualified Receivables Assets” shall mean Receivables (whether now existing or arising in the future) of the Borrower or any Restricted Subsidiary and any Related Security and proceeds of such Receivables and Related Security that are customarily transferred or in which security interests are granted in connection with asset securitization or factoring transactions involving Receivables.
“Qualified Receivables Transaction” shall mean any transaction or series of transactions that may be entered into by the Borrower or any Restricted Subsidiary in which the Borrower or any such Restricted Subsidiary may sell, contribute, convey or otherwise transfer to a Receivables Subsidiary or any other Person (in the case of a transfer by a Receivables Subsidiary), or may grant a security interest in, any Qualified Receivables Assets, including, for the avoidance of doubt, the Specified Receivables Transactions.
“Ratable Share” shall mean:
(i) with respect to a Lender’s obligation to make Revolving Credit Loans, participate in Swing Loans, issue Letters of Credit, participate in Letters of Credit and other Letter of Credit Obligations, and receive payments, interest, and fees related thereto and for purposes of Section 2.15(a)(iii) and (b) [Defaulting Lenders], (a) the proportion that such Lender’s Revolving Credit Commitment bears to the Revolving Credit Commitments of all of the Lenders, (b) the proportion that the aggregate principal amount of such Lender’s participation in Swing Loans bears to the aggregate Swingline Exposure or (c) as such term is used in the definition of “Letter of Credit Issuing Lender Sublimit,” the proportion that a Lender’s Commitment bears to the Commitments of all the Issuing Lenders (or of their Affiliates that are the Revolving Lenders); provided that in the
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case of Section 2.15 [Defaulting Lenders] when a Defaulting Lender shall exist, “Ratable Share” shall mean (x) the percentage of the aggregate Commitments (disregarding any Defaulting Lender’s Commitment) represented by such Lender’s Commitment and (y) the percentage of the aggregate principal amount of the Swing Loans (disregarding any Defaulting Lender’s Swing Loans) represented by such Lenders’ participation in Swing Loans. If the Commitments have terminated or expired, the Ratable Shares for purposes of this clause shall be determined based upon the Revolving Credit Commitments most recently in effect, giving effect to any assignments;
(ii) [reserved];
(iii) [reserved]; and
(iv) with respect to all other matters as to a particular Lender, the percentage obtained by dividing (x) such Lender’s Revolving Credit Commitment plus Term Loans, by (y) the sum of the aggregate amount of the Revolving Credit Commitments plus the Term Loans of all Lenders; provided, however, that if the Revolving Credit Commitments have terminated or expired, the computation in this clause shall be determined based upon the Revolving Credit Commitments most recently in effect, giving effect to any assignments.
“Real Property” shall mean, individually as the context requires, real property that is owned or leased by any Loan Party, including, but not limited to, the surface, Coal, methane gas and other mineral rights, interests and coal leases associated with such property, and “Real Properties” shall mean, collectively, as the context requires, all of the foregoing.
“Receivable Contract” shall mean, with respect to any Receivable, any and all contracts, instruments, agreements, leases, invoices, notes or other writings pursuant to which such Receivable arises or that evidence such Receivable or under which the Person obligated to make payments pursuant to such contracts, instruments, agreements, leases, invoices, notes or other writings relating to such Receivable becomes or is obligated to make payment in respect of such Receivable.
“Receivables” shall mean any right to payment of a monetary obligation, whether or not earned by performance, owed to the Borrower, any Restricted Subsidiary or any Receivables Subsidiary, whether constituting an account, as-extracted collateral, chattel paper, payment intangible, instrument or general intangible, in each instance arising in connection with the sale of goods that have been or are to be sold or for services rendered or to be rendered by the Borrower or any Restricted Subsidiary, and includes the obligation to pay any finance charges, fees and other charges with respect thereto. Any such right to payment arising from any one transaction, including any such right to payment represented by an individual invoice or agreement, shall constitute a Receivable separate from a Receivable consisting of any such right to payment arising from any other transaction.
“Receivables Related Standstill Agreement” shall mean an agreement in form and substance reasonably satisfactory to the Collateral Agent, pursuant to which the Collateral Agent shall agree with the collateral agent (or person serving a similar function) in respect of the Qualified Receivables Transaction on limitations on Collateral Agent’s exercise of remedies or foreclosure on Collateral constituting Equity Interests of, or subordinated notes issued by, any Receivables Subsidiary.
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“Receivables Subsidiary” shall mean a wholly owned Subsidiary of the Borrower (or another Person formed for the purpose of engaging in a Qualified Receivables Transaction with the Borrower or a Restricted Subsidiary in which the Borrower or any Restricted Subsidiary makes an Investment and to which the Borrower or any Restricted Subsidiary transfers Receivables) that engages in no activities other than in connection with the financing of Receivables, all proceeds thereof and all rights (contractual or other), collateral and other assets, in each case, relating to such Receivables, and any business or activities incidental or related to such business, and that is designated by the Borrower’s Board of Directors (as provided below) as a Receivables Subsidiary and
(1) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which:
(a) is Guarantied by the Borrower or any Restricted Subsidiary (excluding Guaranties of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings);
(b) is recourse to or obligates the Borrower or any Restricted Subsidiary in any way other than pursuant to Standard Securitization Undertakings; or
(c) subjects any property or asset of the Borrower or of any Restricted Subsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings;
(2) with which neither the Borrower nor any Restricted Subsidiary has any material contract, agreement, arrangement or understanding other than on terms no less favorable to the Borrower or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Borrower, other than agreements entered into in the ordinary course of business in connection with servicing Receivables; and
(3) with which neither the Borrower nor any Restricted Subsidiary has any obligation to maintain or preserve such Receivables Subsidiary’s financial condition or cause such Receivables Subsidiary to achieve certain levels of operating results.
Any designation of a Receivables Subsidiary by the Borrower’s Board of Directors after the Closing Date shall be evidenced to the Administrative Agent by delivering to the Administrative Agent a Board Resolution giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the preceding conditions. For the avoidance of doubt, as of the Amendment No. 6 Effective Date, ARCH RECEIVABLE COMPANY, LLC, a Delaware limited liability company, and CONSOL FUNDING LLC, a Delaware limited liability company, shall each be deemed to be a Receivables Subsidiary.
“Recipient” shall mean (i) the Administrative Agent, (ii) any Lender and (iii) any Issuing Lender, as applicable.
“Refinance” shall mean, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, redeem, replace, defease or retire, or to issue other Indebtedness in exchange or replacement for, such Indebtedness. “Refinanced” and “Refinancing” shall have correlative meanings. With respect to the CONSOL BMT Bonds, the CONSOL CRDA Bonds and the Arch Tax Exempt Bonds, the term “Refinance” shall not preclude any Indebtedness issued to refinance or replace the CONSOL BMT Bonds, the CONSOL CRDA Bonds or the Arch Tax Exempt Bonds merely because it is not incurred concurrently, but rather at a later date.
“Refinanced Term Loans” has the meaning specified in Section 2.13.1(i) [Refinancing Term Loans].
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“Refinanced Term Loan Class” has the meaning specified in Section 2.13.1(i) [Refinancing Term Loans].
“Refinancing Indebtedness” shall mean Indebtedness that Refinances any Indebtedness of the Borrower or any Restricted Subsidiary existing on the Closing Date or incurred in compliance with this Agreement, including Indebtedness that Refinances Refinancing Indebtedness; provided that:
(1) such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced;
(2) such Refinancing Indebtedness has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being Refinanced;
(3) such Refinancing Indebtedness has an aggregate principal amount (or if incurred with original issue discount, an aggregate issue price) that is equal to or less than the aggregate principal amount (or if incurred with original issue discount, the aggregate accreted value) then outstanding (plus fees and expenses, including any premium and defeasance costs) under the Indebtedness being Refinanced (provided that, with respect to Refinancing the CONSOL BMT Bonds, the CONSOL CRDA Bonds, and the Arch Tax Exempt Bonds, the aggregate principal amount of such Refinancing Indebtedness may be calculated based on the total principal amount of Indebtedness of the CONSOL BMT Bonds, the CONSOL CRDA Bonds, and the Arch Tax Exempt Bonds that is being so Refinanced, so long as, for the avoidance of doubt, once Refinancing Indebtedness has been issued or incurred in respect of any principal amount of any CONSOL BMT Bonds, CONSOL CRDA Bonds or Arch Tax Exempt Bonds, as the case may be, such principal amount of such CONSOL BMT Bonds, CONSOL CRDA Bonds or Arch Tax Exempt Bonds, as the case may be, shall not again serve as the basis for any Refinancing Indebtedness of CONSOL BMT Bonds, CONSOL CRDA Bonds or the Arch Tax Exempt Bonds, as the case may be);
(4) if the refinanced Indebtedness was (A) subordinated in right of payment to the Obligations or the Guaranties thereof, as the case may be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Obligations or the Guaranties thereof, as the case may be, at least to the same extent as the Indebtedness being Refinanced or (B) secured by a Lien on Collateral that was contractually junior to the Lien on such Collateral securing the Obligations, then such Refinancing Indebtedness (i) may be secured by such Collateral only to the extent the Liens on such Collateral securing such Refinancing Indebtedness are contractually junior to the Liens on such Collateral securing the Obligations to at least the same extent as in the Indebtedness being Refinanced and (ii) if so secured, must be subject to an Intercreditor Agreement that is reasonably satisfactory to the Collateral Agent; and
(5) if the refinanced Indebtedness is purchase money obligations, (a) the holders of such Refinancing Indebtedness agree that they will look solely to the fixed assets so acquired which secure such Refinancing Indebtedness, and neither the Borrower nor any Restricted Subsidiary (i) is directly or indirectly liable for such Refinancing Indebtedness or (ii) provides credit support, including any undertaking, Guaranty, agreement or instrument, related to such Refinancing Indebtedness that would constitute Indebtedness (other than the grant of a Lien on such acquired fixed assets) and (b) no default or event of default with respect to such Refinancing Indebtedness would cause, or permit (after notice or passage of time or otherwise), any holder of any other Indebtedness of the Borrower or a Guarantor to declare a default or event of default on such other Indebtedness or cause the payment, repurchase, redemption, defeasance or other acquisition or retirement for value thereof to be accelerated or payable prior to any scheduled principal payment, scheduled sinking fund payment or maturity;
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provided further, however, that Refinancing Indebtedness shall not include:
(a) Indebtedness of a Subsidiary that Refinances Indebtedness of the Borrower;
(b) Indebtedness of the Borrower or a Restricted Subsidiary of the Borrower that Refinances Indebtedness of an Unrestricted Subsidiary; or
(c) Indebtedness of a Restricted Subsidiary of the Borrower that is not a Loan Party which Refinances Indebtedness of a Loan Party.
“Refinancing Term Lender” shall have the meaning specified in Section 2.13.2 [Refinancing Term Loans].
“Refinancing Term Loan Effective Date” shall have the meaning specified in Section 2.13.2 [Refinancing Term Loans].
“Refinancing Term Loans” shall have the meaning specified in Section 2.13.1 [Refinancing Term Loans].
“Reimbursement Date” shall have the meaning specified in Section 2.9.3(b) [Participations, Disbursements, Reimbursement].
“Reimbursement Obligation” shall have the meaning specified in Section 2.9.3(b) [Participations, Disbursements, Reimbursement].
“Related Parties” shall mean, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, advisors, trustees, administrators, managers and representatives of such Person and of such Person’s Affiliates.
“Related Security” shall mean, with respect to any Receivable subject to a Qualified Receivables Transaction:
(1) all of the Loan Parties’ interests in any goods (including returned goods), and documentation of title evidencing the shipment or storage of any goods (including returned goods), relating to any sale giving rise to such Receivable,
(2) all instruments and chattel paper that may evidence such Receivable,
(3) all other security interests or liens and property subject thereto from time to time purporting to secure payment of such Receivable, whether pursuant to the contract related to such Receivable or otherwise, together with all UCC financing statements or similar filings relating thereto,
(4) all of the Loan Parties’ rights, interests and claims under the contracts and all guaranties, indemnities, insurance and other agreements (including the related contract) or arrangements of whatever character from time to time supporting or securing payment of such Receivable or otherwise relating to such Receivable, whether pursuant to the contract related to such Receivable or otherwise;
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(5) all of the Loan Parties’ rights, remedies, powers, privileges, title and interest (but not obligations) under any agreement pursuant to which such Loan Party purchases Receivables from any of the Borrower’s Subsidiaries in connection with a Qualified Receivables Transaction;
(6) all books and records of the Loan Parties to the extent related to any of the foregoing, and all rights, remedies, powers, privileges, title and interest (but not obligations) in and to each lockbox account and collection account used solely for depositing proceeds of such Receivables, and any related investment property acquired with any such proceeds (as such term is defined in the applicable UCC); and
(7) all proceeds (as defined in the UCC) of any of the foregoing that are or were received by any Loan Party, including all funds which either are received by a Loan Party from or on behalf of the Person(s) obligated to make payments pursuant to the Receivable Contract relating to such Receivable in payment of any amounts owed (including invoice price, finance charges, interest and all other charges) in respect of any of the above Receivables or are applied to such amounts owed by such Person(s) (including any insurance payments that any Loan Party applies in the ordinary course of its business to amounts owed in respect of any of the above Receivables, and net proceeds of sale or other disposition of repossessed goods or other collateral or property of such Person(s) in respect of any of the above Receivables or any other parties directly or indirectly liable for payment of such Receivables).
“Release” shall mean any spilling, leaking, pumping, pouring, emitting, emptying, discharge, injecting, escaping, leaching, dumping, disposing, depositing into or migration into or through the Environment, or into, from or through any building or structure.
“Removal Effective Date” shall have the meaning assigned to it in Section 10.6 [Resignation of Agents].
“Reorganization Plan” shall have the meaning assigned to it in Section 11.8.2(f)(ii) [No Assignment to Disqualified Person].
“Replaced Revolving Credit Commitments” shall have the meaning specified in Section 2.14.1 [Replacement Revolving Credit Commitments].
“Replacement Revolving Credit Commitments” shall have the meaning specified in Section 2.14.1 [Replacement Revolving Credit Commitments].
“Replacement Revolving Lender” has the meaning specified in Section 2.14.2 [Replacement Revolving Credit Commitments].
“Reportable Compliance Event” shall mean that any Covered Entity becomes a Sanctioned Person, or is charged by indictment, criminal complaint or similar charging instrument, arraigned, or custodially detained in connection with any Anti-Terrorism Law or any predicate crime to any Anti-Terrorism Law, or has knowledge of facts or circumstances to the effect that it is reasonably likely that any aspect of its operations is in violation of any Anti-Terrorism Law.
“Reportable Event” shall mean a reportable event described in Section 4043 of ERISA or regulations thereunder with respect to a Pension Plan.
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“Required Class Lenders” shall mean, with respect to any Class, (i) in the case of any Class of Term Loans, the Lenders of such Class holding more than 50% of the aggregate principal amount of Term Loans of such Class then outstanding and (ii) in the case of any Class of Revolving Credit Commitments, the Lenders of such Class holding more than 50% of the Revolving Credit Commitments of such Class or, after the termination of the Revolving Credit Commitments of such Class, the outstanding Revolving Credit Loans and Ratable Share of Letter of Credit Obligations of such Class; provided that the Revolving Credit Commitment, Loans and Ratable Share of Letter of Credit Obligations of any Defaulting Lender shall be disregarded.
“Required Collateral” shall mean (a) all Equity Interests in PA Mining Complex LP and PA Mining Complex GP LLC owned by the Borrower or any of its Subsidiaries, (b) (A) the Undivided Interests in the Pennsylvania Mining Complex owned by the Borrower or any of its Subsidiaries and (B) the Pennsylvania Mining Complex, (c) the Baltimore Dock Facility and (d) the Specified Coal Reserves.
“Required Flood Materials” shall mean, at any time of determination, with respect to each Real Property that is improved with a Building and is subject to a Mortgage at such time, or is the subject of a Mortgage to be delivered at such time, (i) a “Life-of-Loan” flood hazard determination with respect to such Real Property and (ii) if such Real Property is located in a special flood hazard area, (a) a notification to the Borrower of that fact and evidence of the receipt by the Borrower of such notice and (b) evidence of flood insurance on such Real Property that complies with Section 8.1.3 [Maintenance of Insurance].
“Required Lenders” shall mean, collectively, Lenders holding more than 50% of the sum of (i) the Revolving Credit Commitments or, after the termination of the Revolving Credit Commitments, the outstanding Revolving Credit Loans and Ratable Share of Letter of Credit Obligations and (ii) the aggregate principal amount of any Term Loans then outstanding; provided that the Revolving Credit Commitment, Revolving Credit Loans and Ratable Share of Letter of Credit Obligations of any Defaulting Lender shall be disregarded.
“Required Permits” shall mean all permits, licenses, authorizations, plans, approvals and bonds necessary under the applicable Laws for the Loan Parties to continue to conduct coal mining and related operations on, in or under such parties’ real property, and any and all other mining properties owned or leased by the Borrower or any such Loan Party (collectively, “Mining Property”) substantially in the manner as such operations had been authorized immediately prior to such Loan Party’s acquisition of its interests in such real property and as may be necessary for such Loan Party to conduct, in all material respects, coal mining and related operations on, in or under the Mining Property as described in any plan of operation.
“Required Revolving Lenders” shall mean Lenders holding more than 50% of the Revolving Credit Commitments or, after the termination of the Revolving Credit Commitments, the outstanding Revolving Credit Loans and Ratable Share of Letter of Credit Obligations; provided that the Revolving Credit Commitment, Revolving Credit Loans and Ratable Share of Letter of Credit Obligations of any Defaulting Lender shall be disregarded.
“Required Share” shall have the meaning assigned to such term in Section 5.11 [Settlement Date Procedures].
“Resolution Authority” shall mean an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
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“Responsible Officer” shall mean, with respect to any Loan Party, each of the chief executive officer, president, vice president, chief financial officer, chief administrative officer, general counsel, secretary, treasurer and assistant treasurer of such Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.
“Restricted Payment” shall mean:
(1) the declaration or payment of any dividends or any other distributions of any sort in respect of Equity Interests of the Borrower or any Restricted Subsidiary (including any payment in connection with any merger or consolidation involving the Borrower or any Restricted Subsidiary) or similar payment to the direct or indirect holders of such Equity Interests, other than:
(a) dividends or distributions payable solely in Equity Interests of the Borrower (other than Disqualified Stock);
(b) dividends or distributions payable solely to the Borrower or a Restricted Subsidiary; and
(c) pro rata dividends or other distributions made by a Restricted Subsidiary to minority stockholders (or owners of an equivalent interest in the case of a Subsidiary that is an entity other than a corporation);
(2) the purchase, repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Borrower or any Restricted Subsidiary held by any other Person (other than any acquisition or retirement for value from, or payment to, the Borrower or any Restricted Subsidiary); or
(3) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment of any Specified Junior Obligations (other than any intercompany Indebtedness between or among the Borrower and any Restricted Subsidiary).
“Restricted Subsidiary” shall mean any Subsidiary of the Borrower that is not an Unrestricted Subsidiary.
“Revolving Commitment Increase” shall have the meaning assigned to such term in Section 2.11.1 [Establishment of Incremental Facilities].
“Revolving Credit Commitment” shall mean, as to any Lender at any time, the aggregate amount initially set forth opposite its name on Schedule 1.1(B) (as amended by Amendment No. 6) in the column labeled “Revolving Credit Commitment” as such Commitments are thereafter assigned pursuant to an Assignment and Assumption Agreement, increased pursuant to Section 2.11 [Incremental Facilities], extended pursuant to Section 2.12 [Extended Term Loans and Extended Revolving Credit Commitments], replaced pursuant to Section 2.14 [Replacement Revolving Credit Commitments] or decreased pursuant to Section 2.4 [Commitment Reductions and Terminations], and “Revolving Credit Commitments” shall mean the aggregate Revolving Credit Commitments of all of the Lenders.
“Revolving Credit Loans” shall mean collectively all Revolving Credit Loans and “Revolving Credit Loan” shall mean separately any Revolving Credit Loan made by the Revolving Lenders or one of the Revolving Lenders to the Borrower pursuant to Section 2.1.1 [Revolving Credit Loans] or Section 2.9.3 [Participations, Disbursements, Reimbursement].
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“Revolving Credit Notes” shall mean collectively and “Revolving Credit Note” shall mean separately all the promissory notes of the Borrower in the form of Exhibit 1.1(N)(1) evidencing the Revolving Credit Loans.
“Revolving Exposure” shall mean, with respect to any Revolving Lender at any time, the sum of the outstanding principal amount of such Revolving Lender’s Revolving Credit Loans and its Letter of Credit Obligations and Swingline Exposure at such time.
“Revolving Extension Request” shall have the meaning set forth in Section 2.12(b) [Extended Term Loans and Extended Revolving Credit Commitments].
“Revolving Facility Usage” shall mean at any time the sum of the outstanding Revolving Credit Loans, the outstanding Swing Loans, and the Letter of Credit Obligations.
“Revolving Lender” shall mean a Person with a Revolving Credit Commitment or, if the Revolving Credit Commitments have terminated or expired, a Person with Revolving Exposure.
“Revolving Maturity Date” shall mean (x) April 30, 2029; provided that if (A) any CONSOL BMT Bonds or CONSOL CRDA Bonds or any other Indebtedness incurred to Refinance any of such CONSOL BMT Bonds or CONSOL CRDA Bonds (the “Applicable Refinancing Debt”), is or are outstanding on the date that is 91 days prior to the Applicable Maturity Date (the “Springing Maturity Test Date”) and (B) after giving effect to any payment of CONSOL BMT Bonds or CONSOL CRDA Bonds or Applicable Refinancing Debt on the Springing Maturity Test Date, Specified Liquidity as of the Springing Maturity Test Date is less than $250,000,000, then the Revolving Maturity Date shall be the date that is 91 days prior to the Applicable Maturity Date or (y) with respect to any Revolving Credit Commitments established pursuant to an Additional Credit Extension Amendment, the maturity date established for such Revolving Credit Commitments as specified therein; provided that if the applicable Revolving Maturity Date is not a Business Day, such date shall be the immediately preceding Business Day.
“S&P” shall mean Standard and Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business, and any successor thereto.
“Sanctioned Country” shall mean a country, territory or region subject to a sanctions program maintained under any Anti-Terrorism Law.
“Sanctioned Person” shall mean any individual person, group, regime, entity or thing listed or otherwise recognized as a specially designated, prohibited, sanctioned or debarred person, group, regime, entity or thing, or subject to any limitations or prohibitions (including but not limited to the blocking of property or rejection of transactions), under any Anti-Terrorism Law.
“SEC” shall mean the Securities and Exchange Commission, or any Official Body succeeding to any of its principal functions.
“Secured Parties” shall mean collectively, the Collateral Agent, the Administrative Agent, the Swingline Lender, the Issuing Lenders, the Lenders, the Indemnitees and any provider of a Specified Swap Agreement or Other Lender Provided Financial Service Product.
“Securities Act” shall mean the Securities Act of 1933.
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“Security Agreement” shall mean the Security Agreement, dated as of the Closing Date, executed and delivered by each of the Loan Parties to the Collateral Agent for the benefit of the Secured Parties.
“Security Documents” shall mean, collectively, the Security Agreement, the Mortgages, the Patent, Trademark and Copyright Security Agreement, the Intercreditor Agreements and each other security document or pledge agreement delivered in accordance with applicable local Law to grant a valid, perfected security interest in any property as Collateral for the Obligations, and all UCC or other financing statements or instruments of perfection required by this Agreement or any other such security document or pledge agreement to be filed with respect to the security interests in property and fixtures created pursuant to any document or instrument utilized to pledge or grant or purport to pledge or grant a security interest or lien on any property as Collateral for the Obligations, and amendments, supplements or joinders to the foregoing.
“Settlement Date” shall mean the Business Day on which the Administrative Agent elects to effect settlement pursuant to Section 5.11 [Settlement Date Procedures].
“SOFR” shall mean, for any day, a rate equal to the secured overnight financing rate as administered by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).
“SOFR Adjustment” shall mean ten basis points (0.10%).
“SOFR Floor” shall mean a rate of interest per annum equal to 0.00%.
“SOFR Reserve Percentage” shall mean, for any day, the maximum effective percentage in effect on such day, if any, as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the reserve requirements (including, without limitation, supplemental, marginal and emergency reserve requirements) with respect to SOFR funding.
“Solvent” shall mean, with respect to any Person on any date of determination, taking into account such right of reimbursement, contribution or similar right available to such Person from other Persons, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person, (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay such debts and liabilities as they mature, (d) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s property would constitute unreasonably small capital after giving due consideration to the prevailing practice in the industry in which such Person is engaged, and (e) such Person is able to pay its debts and liabilities, contingent obligations and other commitments as they mature in the ordinary course of business. In computing the amount of contingent liabilities at any time, it is intended that such liabilities will be computed at the amount which, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.
“Specified Coal Reserves” shall mean the properties set forth on Schedule 3(c) of the Perfection Certificate.
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“Specified Issuing Lenders” shall mean any Person that becomes an Issuing Lender after the Closing Date and has provided written notice (prior to becoming an Issuing Lender) to the Administrative Agent and the Borrower that it does not issue Commercial Letters of Credit.
“Specified Junior Obligations” shall mean (i) any Indebtedness that is incurred or outstanding pursuant to Section 8.2.1(h)(A), (B) and (D), (i)(z) or (m) [Indebtedness] and (ii) any Subordinated Obligations.
“Specified Leased Properties” shall mean any Real Property leased by a Loan Party for which the lease requires consent from the landlord in order for such Loan Party to grant a first priority lien, security interest and assignment in its leasehold interest therein.
“Specified Liquidity” shall mean the sum at any time of (a) Cash on Hand at such time plus (b) the excess of the Revolving Credit Commitments over the Revolving Exposure of all Revolving Lenders at such time plus (c) if a Qualified Receivables Transaction is effective at such time, the aggregate available commitments under such Qualified Receivables Transaction (as limited by the borrowing base thereunder).
“Specified Receivables Transactions” shall mean the transactions contemplated by (a) that certain Receivables Financing Agreement, dated the Specified Receivables Transaction Closing Date (as the same may be amended, supplemented, restated or otherwise modified from time to time), by and among CONSOL Funding LLC, as borrower, PNC Bank, National Association, as administrative agent, CPCC, as initial servicer, and the lenders and other entities from time to time party thereto, so long as such Receivables Financing Agreement and the other documentation, filings and instruments entered into and/or delivered in connection therewith are in form and substance reasonably satisfactory to the Administrative Agent and (b) that certain Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016, by and among Arch Receivable Company, LLC, Arch Coal Sales Company, Inc., the purchasers and other agents party thereto from time to time and PNC Bank, National Association, as administrator.
“Specified Receivables Transaction Closing Date” shall mean November 30, 2017.
“Specified Swap Agreement” shall mean any Swap Agreement entered into for the purpose of hedging risk between (a) any Loan Party and (b) any counterparty that is, or was at the Closing Date or at the time such Swap Agreement was entered into, an Agent, a Lender or an Affiliate of an Agent or a Lender.
“Springing Maturity Test Date” shall have the meaning assigned to such term in the definition of “Revolving Maturity Date.”
“Standard Securitization Undertakings” shall mean representations, warranties, covenants and indemnities customarily entered into in connection with accounts receivables financings.
“Standby Letter of Credit” shall mean a Letter of Credit that is not a Commercial Letter of Credit.
“Stated Maturity” shall mean, with respect to any Indebtedness, the maturity date (or specified date on which the final payment of principal on such Indebtedness is due) applicable thereto including as such maturity date (or specified date) may be changed to an earlier date pursuant to the provisions of the documents governing such Indebtedness including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such Indebtedness at the option of the holder thereof upon the happening of any contingency unless such contingency has occurred).
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“Subordinated Obligation” shall mean any Indebtedness of the Borrower or any Guarantor (whether outstanding on the Closing Date or thereafter incurred) which is subordinate or junior in right of payment to, in the case of the Borrower, the Obligations or, in the case of a Guarantor, its Guaranty of the Obligations pursuant to a written agreement to that effect.
“Subsidiary” shall mean, with respect to any Person, any corporation, association, partnership or other business entity of which more than 50% of the total voting power of the Voting Stock thereof is at the time owned or controlled, directly or indirectly, by:
(1) such Person;
(2) such Person and one or more Subsidiaries of such Person; or
(3) one or more Subsidiaries of such Person.
“Subsidiary Shares” shall have the meaning specified in Section 6.3 [Subsidiaries].
“Supported QFC” shall have the meaning assigned to such term in Section 11.17 [Acknowledgement Regarding Any Supported QFCs].
“Swap” shall mean any “swap” as defined in Section 1a(47) of the Commodity Exchange Act and regulations thereunder, other than (a) a swap entered into, or subject to the rules of, a board of trade designated as a contract market under Section 5 of the Commodity Exchange Act, or (b) a commodity option entered into pursuant to Commodity Futures Trading Commission Regulation 32.3(a).
“Swap Agreement” shall mean (i) any Interest Rate Agreement, (ii) any Currency Agreement, (iii) any Hydrocarbon Swap Agreement or (iv) any cap, floor, collar, exchange transaction, hedging contract, forward contract, swap agreement, futures contract, call or put option or any other similar agreement or other exchange or protection agreement relating to commodity prices, securities prices or financial market conditions.
“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a Swap.
“Swing Loan Note” shall mean a promissory note of the Borrower in the form of Exhibit 1.1(N)(2) evidencing the Swing Loans.
“Swing Loan Request” shall mean a request for Swing Loans made in accordance with Section 2.5.2 [Swing Loan Requests].
“Swing Loans” shall mean collectively and “Swing Loan” shall mean separately all Swing Loans or any Swing Loan made by the Swingline Lender to the Borrower pursuant to Section 2.6.3 [Making Swing Loans].
“Swingline Cap” shall mean, at any time, the lesser of (i) $25,000,000 and (ii) the Revolving Credit Commitments at such time.
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“Swingline Exposure” shall mean, at any time, the aggregate principal amount of all Swing Loans outstanding at such time. The Swingline Exposure of any Revolving Lender at any time shall be its Ratable Share of the total Swingline Exposure at such time.
“Swingline Lender” shall mean the Administrative Agent in its capacity as the lender of Swing Loans.
“Taxes” shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Official Body, including any interest, additions to tax or penalties applicable thereto. “Taxation” shall have a correlative meaning.
“Temporary Cash Investments” shall mean any of the following:
(1) any Investment in direct obligations of the United States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof, in each case maturing not later than 18 months following acquisition thereof;
(2) Investments in time deposit accounts, certificates of deposit and money market deposits maturing within 18 months of the date of acquisition thereof issued by (I) a bank or trust company which is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States, and which bank or trust company (A) has capital, surplus and undivided profits aggregating in excess of $250.0 million (or the foreign currency equivalent thereof) and (B) has outstanding debt which is rated “A-” (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Section 3(a)(62) of the Exchange Act) (provided that the requirement in this clause (2)(I)(B) shall not apply to any such bank or trust company which is a Lender) or (II) any money-market fund sponsored by a registered broker dealer or mutual fund distributor whose assets consist of obligations of the types described in clauses (1), (2), (3), (4) and (5) of this definition;
(3) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) of this definition entered into with a bank meeting the qualifications described in clause (2) of this definition;
(4) Investments in commercial paper, maturing not more than 365 days after the date of acquisition, issued by a Person (other than an Affiliate of the Borrower) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any Investment therein is made of “P-2” (or higher) according to Moody’s or “A-2” (or higher) according to S&P or “R-1” (or higher) by Dominion Bond Rating Service Limited or Canadian Bond Rating Service, Inc. (in the case of a Canadian issuer);
(5) Investments in securities with maturities of 18 months or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, in each case rated at least “A” by S&P or “A-2” by Moody’s;
(6) Investments in asset-backed securities maturing within 18 months of the date of acquisition thereof with a long-term rating at the time as of which any Investment therein is made of “A” (or higher) by Dominion Bond Rating Service Limited or Canadian Bond Rating Service, Inc. (in the case of a Canadian issuer);
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(7) obligations of any foreign government or obligations that possess a guaranty of the full faith and credit of any foreign government maturing not later than 18 months after acquisition thereof;
(8) obligations of United States government-sponsored enterprises, Federal agencies, and Federal financing banks that are not otherwise authorized including, but not limited to, (i) United States government-sponsored enterprises such as instrumentalities of the Federal Credit System (Bank for Cooperatives, Federal Land Banks), Federal Home Loan Banks and Federal National Mortgage Association and (ii) Federal agencies such as instrumentalities of the Department of Housing and Urban Development (Federal Housing Administration, Government National Mortgage Association), Export-Import Bank, Farmers Home Administration and Tennessee Valley Authority, in each case maturing not later than one year following acquisition thereof;
(9) debt obligations (other than commercial paper obligations) of domestic or foreign corporations maturing not later than 18 months after acquisition thereof;
(10) preferred stock obligations with a floating rate dividend that is reset periodically at auction maturing not later than one year after acquisition thereof;
(11) Investments in repurchase agreements collateralized by any of the above securities eligible for outright purchase; provided that the collateral is delivered to a bank custody account in accordance with the terms of a written repurchase agreement with a dealer or bank;
(12) Investments in shares of institutional mutual funds whose investment policies are essentially in agreement with the type and criteria for Investments otherwise set forth in this definition;
(13) securities with maturities of 18 months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank meeting the qualifications described in clause (2) of this definition; and
(14) money market auction rate notes with auctions scheduled no less frequently than every 49 days;
provided that Investments described in clauses (7) through (14) of this definition are restricted to obligations rated no lower than “A3” or “P-1” by Moody’s or “A-“ or “A-1” by S&P.
“Term Extension Request” shall have the meaning set forth in Section 2.12(a) [Extended Term Loans and Extended Revolving Credit Commitments].
“Term Lender” shall mean a Person with a Term Loan Commitment or an outstanding Term Loan.
“Term Loan Commitment” shall mean any Incremental Term Loan Commitment or any other commitments to make Extended Term Loans or Refinancing Term Loans.
“Term Loans” shall mean, collectively, the Incremental Term Loans, the Extended Term Loans and Refinancing Term Loans.
“Term Note” shall mean a promissory note of the Borrower in the form of Exhibit 1.1(N)(3) evidencing a Term Loan.
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“Term SOFR Administrator” shall mean CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Administrative Agent in its reasonable discretion).
“Term SOFR Rate” shall mean, with respect to any amount to which the Term SOFR Rate Option applies, for any Interest Period, the interest rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, at the Administrative Agent’s discretion, to the nearest 1/100th of 1%) (A) the Term SOFR Reference Rate for a tenor comparable to such Interest Period, as such rate is published by the Term SOFR Administrator on the day (the “Term SOFR Determination Date”) that is two (2) Business Days prior to the first day of such Interest Period, by (B) a number equal to 1.00 minus the SOFR Reserve Percentage. If the Term SOFR Reference Rate for the applicable tenor has not been published or replaced with a Benchmark Replacement by 5:00 p.m. (Pittsburgh, Pennsylvania time) on the Term SOFR Determination Date, then the Term SOFR Reference Rate, for purposes of clause (A) in the preceding sentence, shall be the Term SOFR Reference Rate for such tenor on the first Business Day preceding such Term SOFR Determination Date for which such Term SOFR Reference Rate for such tenor was published in accordance herewith, so long as such first preceding Business Day is not more than three (3) Business Days prior to such Term SOFR Determination Date. If the Term SOFR Rate, determined as provided above, would be less than the SOFR Floor, then the Term SOFR Rate shall be deemed to be the SOFR Floor. The Term SOFR Rate shall be adjusted automatically without notice to the Borrower on and as of (i) the first day of each Interest Period, and (ii) the effective date of any change in the SOFR Reserve Percentage.
“Term SOFR Rate Loan” shall mean a Loan that bears interest based on Term SOFR Rate.
“Term SOFR Rate Option” shall mean the option of the Borrower to have Loans bear interest at the rate and under the terms set forth in Section 4.1.1(a)(ii) [Term SOFR Rate Option].
“Term SOFR Reference Rate” shall mean the forward-looking term rate based on SOFR.
“Threshold Amount” shall mean $65,000,000.
“Total Liquidity” shall mean the sum at any time of (a) Cash on Hand at such time plus (b) the excess of the Revolving Credit Commitments over the Revolving Exposure of all Revolving Lenders at such time that would be permitted to be drawn as Revolving Credit Loans at such time without breaching the Financial Covenants set forth in Section 8.2.13(a) or (b) (determined as if they were in effect as of the end of the most recent fiscal quarter ended) plus (c) if a Qualified Receivables Transaction is effective at such time, the aggregate available commitments under such Qualified Receivables Transaction (as limited by the borrowing base thereunder) without breaching any financial covenants that may be applicable thereunder as of the most recently ended fiscal quarter at such time (assuming such available commitments were drawn at such quarter end).
“Total Net Leverage Ratio” shall mean, as of any date, the ratio of (without duplication), (A) (x) Consolidated Indebtedness as of such date minus (y) Cash on Hand as of such date to (B) Consolidated EBITDA of the Borrower and the Restricted Subsidiaries for the period of four fiscal quarters of the Borrower most recently ended on or prior to the date of determination.
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“Trade Date” shall mean (a) with respect to any assignment of Loans or Commitments, the “Trade Date” specified in the applicable Assignment and Assumption Agreement (or if not so specified, the date the Assignment and Assumption Agreement with respect an assignment is delivered to the Administrative Agent) and (b) with respect to any participation, the date on which the assigning Lender entered into a binding agreement to sell such participation.
“U.S. Special Resolution Regimes” shall have the meaning assigned to such term in Section 11.17 [Acknowledgement Regarding Any Supported QFCs].
“UCP” shall have the meaning assigned to such term in Section 11.11.1 [Governing Law].
“UK Financial Institution” shall mean any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended form time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
“UK Resolution Authority” shall mean the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
“Undivided Interests” shall mean the undivided co-ownership interests in the Pennsylvania Mining Complex.
“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code as in effect in each applicable jurisdiction or other applicable Law entitled to all the rights, benefits and priorities provided by the Uniform Commercial Code or such Law.
“United States Tax Compliance Certificate” shall have the meaning assigned to such term in Section 5.9.5(b)(i)(C) [Status of Lenders].
“Unrestricted Subsidiary” shall mean any Subsidiary of the Borrower that is designated by the Board of Directors of the Borrower as an Unrestricted Subsidiary pursuant to a Board Resolution in accordance with Section 8.2.3 [Designation of Unrestricted Subsidiaries]. All Subsidiaries of an Unrestricted Subsidiary shall also be Unrestricted Subsidiaries.
“U.S. Government Securities Business Day” shall mean any day except for (a) a Saturday or Sunday or (b) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
“USA PATRIOT Act” shall mean the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed, extended, amended or replaced.
“Voting Stock” of a Person shall mean all classes of Capital Stock of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.
“Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness at any date, the number of years obtained by dividing: (a) the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by (b) the then outstanding principal amount of such Indebtedness.
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“Wholly-Owned Subsidiary” of any specified Person shall mean a Subsidiary of such Person all of the outstanding Equity Interests or other ownership interest of which (other than directors’ qualifying shares) will at that time be owned by such Person or by one or more Wholly-Owned Subsidiaries of such Person.
“Write-Down and Conversion Powers” shall mean, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.
1.2 Construction/Calculations.
Unless the context of this Agreement otherwise clearly requires, the following rules of construction shall apply to this Agreement and each of the other Loan Documents: (i) references to the plural include the singular, the plural, the part and the whole and the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; (ii) the words “hereof,” “herein,” “hereunder,” “hereto” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document as a whole; (iii) article, section, subsection, clause, schedule and exhibit references are to this Agreement or other Loan Document, as the case may be, unless otherwise specified; (iv) reference to any Person includes such Person’s permitted successors and assigns; (v) unless otherwise provided, reference to any agreement, including this Agreement and any other Loan Document together with the schedules and exhibits hereto or thereto, document or instrument, order, declaration, understanding or other arrangement means such agreement, document, instrument, order, declaration, understanding or other arrangement as amended, restated, supplemented, modified, extended, renewed, refunded, superseded, substituted for, replaced, refinanced or increased in whole or in part, from time to time, to the extent not prohibited hereunder; (vi) any reference to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such Law and any reference to any Law shall, unless otherwise specified, refer to such Law as amended, modified, supplemented or replaced from time to time; (vii) relative to the determination of any period of time, “from” means “from and including,” “to” means “to but excluding,” and “through” means “through and including”; (viii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights; (ix) section headings herein and in each other Loan Document are included for convenience and shall not affect the interpretation of this Agreement or such Loan Document; (x) unless otherwise specified, all references herein to times of day shall be references to Eastern time and (xi) references to the “date hereof” or “date of this Agreement” shall be to the Closing Date.
For the avoidance of doubt, if any minimum Total Liquidity test or maximum Total Net Leverage Ratio test applicable to the making of an Investment or Restricted Payment or an incurrence of Indebtedness is satisfied (on a Pro Forma Basis if applicable) as of the time of the making of such Investment or Restricted Payment or incurrence of such Indebtedness in accordance with the terms of such test, the making of such Investment or Restricted Payment or incurrence of such Indebtedness will not be deemed to violate the applicable covenant or restriction contained herein solely because at a later date such minimum Total Liquidity level or maximum Total Net Leverage Ratio test is unable to be satisfied (it being understood that this sentence shall not be construed to excuse any inaccurate certification as to the satisfaction of any such test or the failure to make all pro forma adjustments or proper calculations applicable to such test).
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1.3 Accounting Principles.
Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principles of consolidation where appropriate), and all accounting or financial terms shall have the meanings ascribed to such terms by GAAP; provided, however, that all accounting terms used in Section 8.2 [Negative Covenants] (and all defined terms used in the definition of any accounting term used in Section 8.2 [Negative Covenants] shall have the meaning given to such terms (and defined terms) under GAAP as in effect on the date hereof applied on a basis consistent with those used in preparing the Historical Statements referred to in Section 6.9(a) [Historical Statements]). For the avoidance of doubt, (i) in no event shall any lease be deemed a capital lease for purposes of this Agreement if such lease would have been categorized as an operating lease as determined in accordance with GAAP prior to giving effect to the Accounting Standards Codification Topic 842, Leases and (ii) all lease liabilities and right of use assets in each case related to operating leases shall be excluded from all calculations made under this Agreement. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.
1.4 Valuations.
Whenever this Agreement requires the determination of the monetary value of “other consideration,” a Guaranty, “other obligations” or an Investment and the computation method to determine such monetary value is not already addressed by GAAP, (i) the monetary value of “other consideration” or an Investment of tangible property shall be calculated as the Fair Market Value of such consideration or tangible property, (ii) the monetary value of any Guaranty at any time of a fixed monetary obligation shall be the amount of such fixed monetary obligation at such time, (iii) the monetary value of any Guaranty of a fixed stream of monetary obligations at any time shall be the present value of the remaining amounts of such stream of monetary obligations at such time discounted at a rate equal to the Borrower’s cost of funds at such time, (iv) the monetary value of a Guaranty of performance or of contingent liabilities at any time shall be the amount which, in light of all the facts and circumstances existing at the time, represent the amount which would reasonably be expected to become an actual or matured monetary obligation or liability of the Person making such Guaranty determined by such Person in good faith, or (v) the monetary value of “other obligations,” contingent or otherwise, at any time shall be the amount which, in light of all the facts and circumstances existing at the time, represent the amount which would reasonably be expected to become an actual or matured monetary obligation or liability of the Person who is obligated for such “other obligations.”
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1.5 Letter of Credit Amounts.
Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such times.
1.6 Pro Forma Financial Covenant Compliance.
Whenever compliance with a Financial Covenant is required to be made on a Pro Forma Basis for determining the permissibility of any action, or the level of such Financial Covenant is used in reference to a test or covenant hereunder (but not, for the avoidance of doubt, for the purposes of determining actual compliance with Section 8.2.13 [Financial Covenants]): (a) if such compliance is required prior to a date on which there is a level applicable to such Financial Covenant in such Section 8.2.13 [Financial Covenants], the level for the first date for which there is a level so applicable in such Section shall be used in determining such compliance or whether such test or covenant is satisfied, (b) if such compliance is required on a date on which there is no level applicable to such Financial Covenant in Section 8.2.13 [Financial Covenants] and which follows a date on which there is a level applicable to such Financial Covenant in such Section, the level for the latest date for which there is a level so applicable in such Section shall be used in determining such compliance or whether such test or covenant is satisfied, (c) the levels set forth in this Agreement as applicable to such Financial Covenants in such Section shall not give effect to any amendment, modification or waiver with respect to such Section (or any amendment, modification or waiver of a definition as applied in such Section) that is not approved by the Required Lenders, and (d) for purposes of determining actual compliance with a Financial Covenant (but not for purposes of determining compliance on a Pro Forma Basis to determine the permissibility of any action or the level of such Financial Covenant is used in reference to a test or covenant hereunder) Consolidated EBITDA and Consolidated Interest Expense solely for the fiscal quarter ended December 31, 2024 shall not be calculated on a Pro Forma Basis insofar as such calculation would require giving pro forma effect to the consummation of the Arch Merger.
1.7 Interest Rates.
Section 4.6(d) [Benchmark Replacement Setting] of this Agreement provides a mechanism for determining an alternative rate of interest in the event that any Benchmark is no longer available or in certain other circumstances. The Administrative Agent does not warrant or accept any responsibility for and shall not have any liability with respect to, (a) the continuation of, administration of, submission of or calculation of, or any other matter related to, any Benchmark or any component definition thereof or rates referred to in the definition thereof, or any alternative or successor rate thereto, or replacement rate therefor (including any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement) will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, such Benchmark prior to its discontinuance or unavailability, or (b) the effect, implementation or composition of any Conforming Changes. The Administrative Agent and its affiliates or other related entities may engage in transactions that affect the calculation of any Benchmark, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto, in each case, in a manner adverse to the Borrower or any other person or entity. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain any Benchmark, any component definition thereof or rates referred to in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrower, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.
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2. FACILITIES
2.1 Commitments.
2.1.1 Revolving Credit Loans.
Subject to the terms and conditions hereof and relying upon the representations and warranties herein set forth, each Lender severally agrees to make Revolving Credit Loans to the Borrower under each Class for which it has a Revolving Credit Commitment at any time or from time to time after the Closing Date to, but not including, the applicable Revolving Maturity Date; provided that after giving effect to each such Loan, (i) such Lender’s Revolving Exposure shall not exceed such Lender’s Revolving Credit Commitment and (ii) the Revolving Facility Usage shall not exceed the Revolving Credit Commitments. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.1.1 [Revolving Credit Loans].
2.1.2 Swing Loans.
Subject to the terms and conditions hereof and relying upon the representations and warranties herein set forth, and in order to facilitate loans and repayments between Settlement Dates, the Swingline Lender may, at its option, cancelable at any time for any reason whatsoever, make swing loans (the “Swing Loans”) to the Borrower at any time or from time to time after the Closing Date to, but not including, the Revolving Maturity Date, in an aggregate principal amount up to but not in excess of the Swingline Cap; provided that, after giving effect to each such Loan, the Revolving Facility Usage shall not at any time exceed the Revolving Credit Commitments. Within such limits of time and amount and subject to the other provisions of this Agreement, the Borrower may borrow, repay and reborrow pursuant to this Section 2.1.2 [Swing Loans].
2.2 Lenders’ Obligations Several.
Each applicable Lender shall be obligated to participate in each request for Revolving Credit Loans and Term Loans of any Class pursuant to Section 2.5 [Loan Requests] in accordance with its Ratable Share. The obligations of each Lender hereunder are several. The failure of any Lender to perform its obligations hereunder shall not affect the Obligations of the Borrower to any other party nor shall any other party be liable for the failure of such Lender to perform its obligations hereunder.
2.3 Commitment Fees.
Accruing from the Closing Date until the Revolving Maturity Date, the Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender, as consideration for such Lender’s Revolving Credit Commitment hereunder, a nonrefundable commitment fee (the “Commitment Fee”) equal to the Commitment Fee Rate (computed on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed) on the average daily difference between the amount of (a) such Lender’s Revolving Credit Commitment as the same may be constituted from time to time and (b) such Lender’s Revolving Exposure (for purposes of this computation, Swing Loans shall not be deemed to be borrowed amounts under its Revolving Credit Commitment); provided, however, that any Commitment Fee accrued
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with respect to the Revolving Credit Commitment of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall not be payable by the Borrower so long as such Lender shall be a Defaulting Lender except to the extent that such Commitment Fee shall otherwise have been due and payable by the Borrower prior to such time; and provided further that no Commitment Fee shall accrue with respect to the Revolving Credit Commitment of a Defaulting Lender so long as such Lender shall be a Defaulting Lender. Subject to the proviso in the directly preceding sentence, all Commitment Fees shall be payable in arrears on each Payment Date. For the avoidance of doubt, all Commitment Fees which have accrued but are unpaid as of the Amendment No. 6 Effective Date shall be payable on the Payment Date next occurring following the Amendment No. 6 Effective Date.
2.4 Commitment Reductions and Terminations.
2.4.1 Revolving Credit Commitments.
(a) The Borrower shall have the right any time and from time to time, without premium or penalty, upon three (3) Business Days’ prior written notice to the Administrative Agent to permanently reduce, in whole multiples of $5,000,000, or terminate the Revolving Credit Commitments; provided that the Revolving Credit Commitments may not be reduced pursuant to this Section 2.4.1 below the Revolving Facility Usage. All notices to reduce Revolving Credit Commitments shall be irrevocable, except that any such notice may state that it is conditional upon the consummation of a financing transaction, in which case such notice may be revoked or delayed by the Borrower (by notice to the Administrative Agent on or prior to the specified date of reduction) if such condition is not satisfied.
(b) Each reduction of Revolving Credit Commitments shall ratably reduce the Revolving Credit Commitments of the Lenders, except as otherwise provided in an Additional Credit Extension Amendment as permitted in the definition of “Class.” Any reduction or termination of the Revolving Credit Commitments shall be accompanied by (a) the payment in full of any Commitment Fee then accrued on the amount of such reduction or termination and (b) to the extent that the Revolving Facility Usage exceeds the Revolving Credit Commitment as so reduced or terminated, first, the prepayment of Swing Loans, second, the prepayment of Revolving Credit Loans and third, the Cash Collateralization for the benefit of the Issuing Lenders (ratably among the Issuing Lenders) of the Borrower’s obligation under Letter of Credit Obligations (in an aggregate amount under the foregoing first, second and third clauses, equal to such excess), together with the full amount of interest accrued on the principal sum of Revolving Credit Loans to be prepaid (and all amounts referred to in Section 5.10 [Indemnity] hereof). At the request of any Revolving Lender, the Administrative Agent shall promptly distribute to the Borrower, each Issuing Lender and each Revolving Lender a copy of Schedule 1.1(B) as revised to reflect the reduction of Revolving Credit Commitments.
(c) The Revolving Credit Commitments of each Class shall terminate on the applicable Maturity Date.
2.4.2 Term Loan Commitments.
Each Commitment with respect to a Term Loan shall terminate upon the funding of such Term Loan.
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2.5 Loan Requests.
2.5.1 Loan Requests.
Except as otherwise provided herein, subject to the notice requirements set forth in this Section 2.5.1 and the other terms and conditions hereof, (a) the Borrower may from time to time prior to the Revolving Maturity Date request the Lenders of each Class to make Revolving Credit Loans of such Class and (b) the Borrower may from time to time prior to the applicable Maturity Date renew or convert the Interest Rate Option applicable to existing Loans pursuant to Section 4.1 [Interest Rate Options] and Section 4.2 [Interest Periods], by delivering to the Administrative Agent, not later than 11:00 a.m., (i) three (3) Business Days prior to the proposed Borrowing Date with respect to the making of Loans (other than Swing Loans) to which the Term SOFR Rate Option applies or the conversion to or the renewal of the Term SOFR Rate Option for any Loans (other than Swing Loans); and (ii) the same Business Day of the proposed Borrowing Date with respect to the making of a Loan (other than Swing Loans) to which the Base Rate Option applies or the last day of the preceding Interest Period with respect to the conversion to the Base Rate Option for any Loan, of a duly completed request therefor substantially in the form of Exhibit 2.5.1 or a request by telephone immediately confirmed in writing in such form and delivered by facsimile or email (in “pdf,” “tif” or similar format) (each, a “Loan Request”); it being understood that the Administrative Agent may rely on the authority of any individual making such a telephonic request without the necessity of receipt of such written confirmation. Each Loan Request shall be irrevocable and shall specify or certify, as applicable (i) the proposed Borrowing Date; (ii) the aggregate amount of the proposed Loans comprising each Borrowing Tranche, which amount shall be in (x) the an integral multiple of $1,000,000 and not less than $5,000,000 for each Borrowing Tranche under the Term SOFR Rate Option and (y) an integral multiple of $50,000 and not less than the lesser of $500,000 or the maximum amount available for Borrowing Tranches to which the Base Rate Option applies; (iii) whether the Term SOFR Rate Option or Base Rate Option shall apply to the proposed Loans comprising the applicable Borrowing Tranche; and (iv) in the case of a Borrowing Tranche to which the Term SOFR Rate Option applies, an appropriate Interest Period for the Loans comprising such Borrowing Tranche. In addition, each Loan Request shall include a certification by the Borrower that, after giving effect to the borrowing contemplated by such Loan Request, the aggregate amount of Indebtedness (and, notwithstanding the definition of “Indebtedness,” all letters of credit (including Letters of Credit) being deemed to have an outstanding principal amount of Indebtedness equal to the maximum potential liability of the Borrower and its Restricted Subsidiaries thereunder) under this Agreement shall not exceed the Applicable Other Indebtedness Cap; provided that (x) at the Administrative Agent’s request, the Borrower shall provide the Administrative Agent calculations and supporting information reasonably satisfactory to the Administrative Agent showing compliance with the Applicable Other Indebtedness Cap and (y) notwithstanding the foregoing clause (x), the Administrative Agent shall not have any obligation to request such calculation or information or to determine compliance with the Applicable Other Indebtedness Cap, and shall be fully entitled to assume (without any further investigation) that each borrowing of Loans complies with the Applicable Other Indebtedness Cap if the Borrower makes a Loan Request for such borrowing.
2.5.2 Swing Loan Requests.
Except as otherwise provided herein, the Borrower may from time to time prior to the Revolving Maturity Date request the Swingline Lender to make Swing Loans by delivery to the Swingline Lender not later than 2:00 p.m. on the proposed Borrowing Date of a duly completed request therefor substantially in the form of Exhibit 2.5.2 hereto or a request by telephone immediately confirmed in writing in such form and delivered by facsimile or email (in “pdf,” “tif” or similar format) (each, a “Swing Loan Request”); it being understood that the Swingline Lender may rely on the authority of any individual making such a telephonic request without the necessity of receipt of such written confirmation. Each
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Swing Loan Request shall be irrevocable and shall specify (a) the proposed Borrowing Date, (b) the principal amount of such Swing Loan, which shall be in integral multiples of $50,000 and shall be not less than $100,000 and (c) whether such Swing Loan is at the Base Rate Option or the Daily Simple SOFR Option. In addition, each Swing Loan Request shall include a certification by the Borrower that, after giving effect to the borrowing contemplated by such Swing Loan Request, the aggregate amount of Indebtedness (and, notwithstanding the definition of “Indebtedness,” all letters of credit (including Letters of Credit) being deemed to have an outstanding principal amount of Indebtedness equal to the maximum potential liability of the Borrower and its Restricted Subsidiaries thereunder) under this Agreement shall not exceed the Applicable Other Indebtedness Cap; provided that (x) at the Administrative Agent’s request, the Borrower shall provide the Administrative Agent calculations and supporting information reasonably satisfactory to the Administrative Agent showing compliance with the Applicable Other Indebtedness Cap and (y) notwithstanding the foregoing clause (x), the Administrative Agent shall not have any obligation to request such calculation or information or to determine compliance with the Applicable Other Indebtedness Cap, and shall be fully entitled to assume (without any further investigation) that each borrowing of Loans complies with the Applicable Other Indebtedness Cap if the Borrower makes a Swing Loan Request for such borrowing.
2.6 Making Loans; Presumptions by Administrative Agent; Repayment of Revolving Credit Loans; Borrowings to Repay Swing Loans.
2.6.1 Making Loans.
The Administrative Agent shall, promptly after receipt by it of a Loan Request pursuant to Section 2.5.1 [Loan Requests], notify the applicable Lenders of its receipt of such Loan Request specifying the information provided by the Borrower and the apportionment among such Lenders of the requested Loans as determined by the Administrative Agent in accordance with Section 2.2 [Lenders’ Obligations Several]. Each Lender shall remit the principal amount of each Loan of the applicable Class to the Administrative Agent such that the Administrative Agent is able to, and the Administrative Agent shall, to the extent the applicable Lenders have made funds available to it for such purpose and subject to Section 7.2 [Each Additional Loan or Letter of Credit], fund such Loans to the Borrower in U.S. Dollars and immediately available funds at the Principal Office prior to 2:00 p.m. on the applicable Borrowing Date; provided that if any Lender fails to remit such funds to the Administrative Agent in a timely manner, the Administrative Agent may elect in its sole discretion to fund with its own funds the Loans of such Lender on such Borrowing Date, and such Lender shall be subject to the repayment obligation in Section 2.6.2 [Presumptions by the Administrative Agent]. Each Lender may, at its option, make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect in any manner the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
2.6.2 Presumptions by the Administrative Agent.
Unless the Administrative Agent shall have received notice from a Lender prior to 1:00 p.m. on the proposed Borrowing Date of any Loan that such Lender will not make available to the Administrative Agent such Lender’s share of such Loan, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.6.1 [Making Loans] and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Loan available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of a payment to be made by such Lender, the greater of the Federal
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Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (ii) in the case of a payment to be made by the Borrower, the interest rate applicable to Loans of the applicable Class, under the Base Rate Option. If such Lender pays its share of the applicable Loan to the Administrative Agent, then the amount so paid shall constitute such Lender’s Loan. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.
2.6.3 Making Swing Loans.
So long as the Swingline Lender elects to make Swing Loans, the Swingline Lender shall, after receipt by it of a Swing Loan Request pursuant to Section 2.5.2 [Swing Loan Requests], fund such Swing Loan to the Borrower in U.S. Dollars and immediately available funds at the Principal Office prior to 3:00 p.m. on the Borrowing Date.
2.6.4 Repayment of Loans.
The Borrower shall repay all Loans together with all outstanding interest thereon on the Maturity Date with respect thereto (provided that in the case of any Swing Loans, clause (y) of the definition of “Revolving Maturity Date” shall not be given effect unless the applicable Additional Credit Extension Amendment has been consented to by the Swingline Lender). On each date that a Revolving Credit Loan is made, the Borrower shall repay all Swing Loans then outstanding.
2.7 Notes.
2.7.1 Revolving Credit Notes.
If requested by any Revolving Lender, the obligation of the Borrower to repay the aggregate unpaid principal amount of the Revolving Credit Loans of each Class made to it by such Revolving Lender, together with interest thereon, shall be evidenced by a Revolving Credit Note payable to the order of such Revolving Lender in a face amount equal to the Revolving Credit Commitment of such Class of such Revolving Lender. The Revolving Credit Loans of each Class shall mature, and the Borrower unconditionally agrees to pay in full the unpaid principal amount and all amounts outstanding and unpaid in respect of the Revolving Credit Loans of such Class to the Administrative Agent for the account of each applicable Revolving Lender, on the applicable Revolving Maturity Date.
2.7.2 Swing Loan Note.
The obligation of the Borrower to repay the unpaid principal amount of the Swing Loans made to it by the Swingline Lender, together with interest thereon, shall be evidenced by a Swing Loan Note payable to the order of the Swingline Lender in a face amount equal to the Swingline Cap.
2.7.3 Term Notes.
If requested by any Term Lender, the obligation of the Borrower to repay the aggregate unpaid principal amount of Term Loans of each Class made to it by such Term Lender, together with interest thereon, shall be evidenced by a Term Note payable to the order of such Term Lender in a face amount equal to the Term Loans of each Class made by such Term Lender.
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2.8 Use of Proceeds.
The proceeds of the Loans will be used in accordance with Section 8.1.11 [Use of Proceeds; Margin Regulations].
2.9 Letters of Credit.
2.9.1 Issuance of Letters of Credit.
(a) The Borrower may at any time prior to the Letter of Credit Maturity Date request the issuance of a letter of credit (each, a “Letter of Credit”), for its own account or the account of any of the Borrower’s Subsidiaries, or the amendment or extension of an existing Letter of Credit, by delivering or transmitting by facsimile or email (in “pdf,” “tif” or similar format), to an Issuing Lender selected by the Borrower (with a copy to the Administrative Agent) a completed application for letter of credit, or request for such amendment or extension, as applicable, signed by the Borrower (and, in the case of a Letter of Credit issued for the account of any of the Borrower’s Subsidiaries, also signed by such Subsidiary) and otherwise in such form as such Issuing Lender may specify from time to time by no later than 10:00 a.m. at least five (5) Business Days, or such shorter period as may be agreed to by such Issuing Lender, in advance of the proposed date of issuance. The Borrower shall authorize and direct each Issuing Lender to name the Borrower as the “Applicant” or “Account Party” of each Letter of Credit and, in the case of a Letter of Credit issued for the account of any of the Borrower’s Subsidiaries, to name such Subsidiary as the “Co-Applicant” of such Letter of Credit. Promptly after receipt of any letter of credit application, such Issuing Lender shall confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit application and if not, such Issuing Lender will provide the Administrative Agent with a copy thereof. Letters of Credit may be issued in the form of a Standby Letter of Credit or a Commercial Letter of Credit; provided that the Specified Issuing Lenders shall not be required to issue any Commercial Letter of Credit. Letters of Credit shall be issued only in U.S. Dollars.
(b) Unless an Issuing Lender has received notice from any Lender, the Administrative Agent or any Loan Party, at least one day prior to the requested date of issuance, amendment or extension of the applicable Letter of Credit, that one or more applicable conditions in Section 7 [Conditions of Lending and Issuance of Letters of Credit] are not satisfied, then, subject to the terms and conditions hereof and in reliance on (among other things) the agreements of the other Lenders set forth in this Section 2.9, such Issuing Lender or any of such Issuing Lender’s Affiliates will issue the proposed Letter of Credit or agree to such amendment or extension; provided that after giving effect thereto:
(i) no Letter of Credit shall expire later than the earlier of (x) subject to Section 2.9.1(c), twelve (12) months from the date of issuance or extension, unless the applicable Issuing Lender agrees, and (y) with respect to any Issuing Lender, the Letter of Credit Maturity Date for such Issuing Lender, unless such Issuing Lender agrees and the Borrower complies with the requirements of Section 2.9.10 [Cash Collateral Prior to the Revolving Maturity Date]; and
(ii) in no event shall (x) the aggregate amount of Letter of Credit Obligations exceed the Letter of Credit Aggregate Sublimit at any one time outstanding, (y) the aggregate amount of Letter of Credit Obligations with respect to Letters of Credit issued and outstanding by any Issuing Lender exceed its Letter of Credit Issuing Lender Sublimit at any one time (unless otherwise agreed to by such Issuing Lender) or (z) the Revolving Facility Usage exceed the Revolving Credit Commitments that would be in effect at any time prior to the expiration of all Letters of Credit outstanding at such time (after giving effect to the Maturity Date of any Revolving Credit Commitment occurring prior to the expiration of all such Letters of Credit).
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Each request for the issuance, amendment or extension of a Letter of Credit shall be deemed to be a representation by the Borrower that it shall be in compliance with the preceding sentence and with Section 7 [Conditions of Lending and Issuance of Letters of Credit] after giving effect to the requested issuance, amendment or extension of such Letter of Credit. Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to the beneficiary thereof, the applicable Issuing Lender will also deliver to the Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment.
(c) If the Borrower so requests in any applicable request for a Letter of Credit, the Issuing Lender may, in its discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the Issuing Lender to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the Issuing Lender, the Borrower shall not be required to make a specific request to the Issuing Lender for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Revolving Lenders shall be deemed to have authorized (but may not require) the Issuing Lender to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Maturity Date; provided, however, that the Issuing Lender shall not permit any such extension if (A) the Issuing Lender has determined that it would not be permitted to issue such Letter of Credit in its revised form (as extended) under the terms hereof, or (B) it has received notice (which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Revolving Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Revolving Lender or the Borrower that one or more of the applicable conditions specified in Section 7.2 [Each Additional Loan or Letter of Credit] are not then satisfied, and in each such case directing the Issuing Lender not to permit such extension.
(d) Notwithstanding Section 2.9.1(a), no Issuing Lender shall be under any obligation to issue any Letter of Credit if (i) any order, judgment or decree of any Official Body or arbitrator shall by its terms purport to enjoin or restrain such Issuing Lender from issuing the Letter of Credit, or any Law applicable to such Issuing Lender or any request or directive (whether or not having the force of law) from any Official Body with jurisdiction over such Issuing Lender shall prohibit, or request that such Issuing Lender refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon such Issuing Lender with respect to the Letter of Credit any restriction, reserve or capital requirement (for which such Issuing Lender is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such Issuing Lender any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such Issuing Lender in good faith deems material to it, or (ii) the issuance of the Letter of Credit would violate one or more policies of such Issuing Lender applicable to letters of credit generally.
(e) All Existing Letters of Credit shall be deemed to have been issued pursuant hereto and shall be subject to and governed by the terms and conditions hereof; provided that the Borrower, each Revolving Lender and each Loan Party hereby confirm that, notwithstanding the fact that the Borrower is not an account party or obligor on any of the Existing Letters of Credit, the Borrower, each Loan Party and each Revolving Lender remains liable and responsible for all obligations in respect of the Existing Letters of Credit as if the Existing Letters of Credit were newly issued Letters of Credit hereunder and none of Borrower, any Loan Party or any Revolving Lender shall object to any Existing Letter of Credit constituting a Letter of Credit in all respects hereunder; provided further that no Existing Letter of Credit may be amended, renewed, increased or extended and any replacements, renewals, amendments, increases or extensions thereof shall be effectuated with a new Letter of Credit complying with the terms hereof and under which Borrower is an applicant or co-applicant and account party or co-account party with respect thereto.
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2.9.2 Letter of Credit Fees.
The Borrower shall pay (i) to the Administrative Agent for the ratable account of the Revolving Lenders a fee (the “Letter of Credit Fee”) equal to the Applicable Letter of Credit Fee Rate on the daily amount available to be drawn under each Letter of Credit, and (ii) to each Issuing Lender for its own account a fronting fee equal to 0.125% per annum on the daily amount available to be drawn under each Letter of Credit issued by such Issuing Lender. All Letter of Credit Fees and fronting fees shall be computed on the basis of a year of 360 days and actual days elapsed and shall be payable in arrears on each Payment Date following issuance of each Letter of Credit; provided, however, that fronting fees on Commercial Letters of Credit shall be payable at the time of issuance. The Borrower shall also pay to each Issuing Lender for such Issuing Lender’s sole account such Issuing Lender’s then in effect customary fees and administrative expenses payable with respect to the Letters of Credit issued by such Issuing Lender as such Issuing Lender may generally charge or incur from time to time in connection with the issuance, maintenance, extension, renewal, amendment (if any), assignment or transfer (if any), negotiation, and administration of Letters of Credit. For the avoidance of doubt, all Letter of Credit Fees that shall have been accrued but have not been paid as of the Amendment No. 6 Effective Date shall be payable on the next occurring Payment Date following the Amendment No. 6 Effective Date.
2.9.3 Participations, Disbursements, Reimbursement.
(a) Immediately upon the issuance of each Letter of Credit, each Revolving Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from such Issuing Lender a participation in such Letter of Credit and each drawing thereunder in an amount equal to such Revolving Lender’s Ratable Share of the maximum amount available to be drawn under such Letter of Credit and the amount of such drawing, respectively.
(b) In the event of any request for a drawing under a Letter of Credit by the beneficiary or transferee thereof, the applicable Issuing Lender will promptly notify the Borrower and the Administrative Agent thereof. Provided that it shall have received such notice, the Borrower shall reimburse (such obligation to reimburse such Issuing Lender shall sometimes be referred to as a “Reimbursement Obligation”) such Issuing Lender prior to 12:00 noon on the next Business Day following each date that an amount is paid by such Issuing Lender under any Letter of Credit (each such date, a “Reimbursement Date”) by paying to the Administrative Agent for the account of such Issuing Lender an amount equal to the amount so paid by such Issuing Lender plus interest at the interest rate applicable to Revolving Credit Loans under the applicable Base Rate Option from the date on which the amount was paid by such Issuing Lender to the date such Issuing Lender is reimbursed, unless otherwise required by the Administrative Agent or such Issuing Lender. In the event the Borrower fails to reimburse such Issuing Lender (through the Administrative Agent) for the full amount of any drawing under any Letter of Credit by 12:00 noon on the Reimbursement Date, the Administrative Agent will promptly notify each Revolving Lender thereof of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and each such Revolving Lender’s Ratable Share of the amount of such drawing. Any notice given by the Administrative Agent or Issuing Lender pursuant to this Section 2.9.3(b) may be oral if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.
(c) Each Revolving Lender shall upon any notice pursuant to Section 2.9.3(b) make available to the Administrative Agent for the account of the applicable Issuing Lender immediately available funds equal to its Ratable Share of the amount of the drawing, whereupon the Administrative Agent
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shall promptly pay to the Issuing Lender the amounts so received by it from the Revolving Lenders. If any Revolving Lender so notified fails to make available to the Administrative Agent for the account of such Issuing Lender the amount of such Revolving Lender’s Ratable Share of such amount by no later than 2:00 p.m. on the Reimbursement Date, then interest shall accrue on such Revolving Lender’s obligation to make such payment, from the Reimbursement Date to the date on which such Revolving Lender makes such payment (i) at a rate per annum equal to the Federal Funds Effective Rate during the first three (3) days following the Reimbursement Date and (ii) at a rate per annum equal to the rate applicable to Revolving Credit Loans under the applicable Base Rate Option on and after the fourth day following the Reimbursement Date. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this Section 2.9.3, the Administrative Agent shall distribute such payment to the Issuing Lender or, to the extent that Revolving Lenders have made payments pursuant to this Section 2.9.3(c) to reimburse the Issuing Lender, then to such Revolving Lender and the Issuing Lender as their interests may appear. Any payment made by a Revolving Lender pursuant to this Section 2.9.3(c) to reimburse the Issuing Lender for any LC Disbursement shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement. The Administrative Agent and the applicable Issuing Lender will promptly give notice (as described in Section 2.9.3(b) above) of the occurrence of the Reimbursement Date, but failure of the Administrative Agent or such Issuing Lender to give any such notice on the Reimbursement Date or in sufficient time to enable any Revolving Lender to effect such payment on such date shall not relieve such Revolving Lender from its obligation under this Section 2.9.3(c).
(d) If the Issuing Lender shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full as set forth in Section 2.9.3(b), the unpaid amount thereof shall bear interest, for each day from and including the first Business Day after receipt of notice to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum then applicable to Revolving Credit Loans under the applicable Base Rate Option; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to Section 2.9.3(b), then Section 4.3 [Interest After Default] shall apply. Interest accrued pursuant to this paragraph shall be for the account of the Issuing Lender, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to Section 2.9.3(b) to reimburse the Issuing Lender shall be for the account of such Lender to the extent of such payment.
2.9.4 Repayment of Participation Advances.
(a) Upon (and only upon) receipt by the Administrative Agent for the account of an Issuing Lender of immediately available funds from the Borrower (i) in reimbursement of any payment made by such Issuing Lender under the Letter of Credit with respect to which any Revolving Lender has made a payment to the Administrative Agent for the account of such Issuing Lender pursuant to this Section 2.9.4 (each such payment by a Revolving Lender, a “Participation Advance”) to the Administrative Agent, or (ii) in payment of interest on such a payment made by such Issuing Lender under such a Letter of Credit, the Administrative Agent on behalf of such Issuing Lender will pay to each Revolving Lender, in the same funds as those received by the Administrative Agent, the amount of such Revolving Lender’s Ratable Share of such funds, except the Administrative Agent shall retain for the account of such Issuing Lender the amount of the Ratable Share of such funds of any Revolving Lender that did not make a Participation Advance in respect of such payment by such Issuing Lender.
(b) If an Issuing Lender or the Administrative Agent is required at any time to return to any Loan Party, or to a trustee, receiver, liquidator, custodian, or any official in any Insolvency Proceeding, any portion of any payment made by any Loan Party to the Administrative Agent for the account of the Issuing Lender pursuant to this Section in reimbursement of a payment made under any Letter of Credit or interest or fees thereon, each Revolving Lender shall, on demand of the Administrative Agent or
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such Issuing Lender, forthwith return to the Administrative Agent for the account of such Issuing Lender the amount of its Ratable Share of any amounts so returned by the Administrative Agent plus interest thereon from the date such demand is made to the date such amounts are returned by such Revolving Lender to the Administrative Agent, at a rate per annum equal to the Federal Funds Effective Rate in effect from time to time.
2.9.5 Documentation.
Each Loan Party agrees to be bound by the terms of each Issuing Lender’s Issuer Documents and written regulations and customary practices relating to letters of credit, though such interpretation may be different from such Loan Party’s own. In the event of a conflict between an Issuer Document and this Agreement, this Agreement shall govern. It is understood and agreed that, except in the case of gross negligence or willful misconduct, no Issuing Lender shall be liable for any error, negligence and/or mistakes, whether of omission or commission, in following any Loan Party’s instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.
2.9.6 Determinations to Honor Drawing Requests.
In determining whether to honor any request for drawing under any Letter of Credit by the beneficiary thereof, the applicable Issuing Lender shall be responsible only to determine that the documents and certificates required to be delivered under such Letter of Credit have been delivered and that they substantially comply on their face with the requirements of such Letter of Credit.
2.9.7 Nature of Participation and Reimbursement Obligations.
Each Revolving Lender’s obligation in accordance with this Agreement to make Participation Advances, as contemplated by Section 2.9.3 [Participations, Disbursements, Reimbursement] and the Obligations of the Borrower to reimburse each respective Issuing Lender upon a draw under a Letter of Credit shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Section 2.9 [Letters of Credit] under all circumstances, including the following circumstances:
(a) any set-off, counterclaim, recoupment, defense or other right which such Revolving Lender may have against the applicable Issuing Lender or any of its Affiliates, the Borrower or any other Person for any reason whatsoever, or which any Loan Party may have against the applicable Issuing Lender or any of its Affiliates, any Lender or any other Person for any reason whatsoever;
(b) any lack of validity or enforceability of any Letter of Credit;
(c) any claim of breach of warranty that might be made by any Loan Party or any Lender against any beneficiary of a Letter of Credit, or the existence of any claim, set-off, recoupment, counterclaim, crossclaim, defense or other right which any Loan Party or any Lender may have at any time against a beneficiary, successor beneficiary any transferee or assignee of any Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), any Issuing Lender or its Affiliates or any Lender or any other Person or, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Loan Party or Subsidiaries of a Loan Party and the beneficiary for which any Letter of Credit was procured);
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(d) the lack of power or authority of any signer of (or any defect in or forgery of any signature or endorsement on) or the form of or lack of validity, sufficiency, accuracy, enforceability or genuineness of any draft, demand, instrument, certificate or other document presented under or in connection with any Letter of Credit, or any fraud or alleged fraud in connection with any Letter of Credit, or the transport of any property or provisions of services relating to a Letter of Credit, in each case even if such Issuing Lender or any of such Issuing Lender’s Affiliates has been notified thereof;
(e) payment by such Issuing Lender or any of its Affiliates under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not strictly comply with the terms of such Letter of Credit;
(f) the solvency of, or any acts or omissions by, any beneficiary of any Letter of Credit, or any other Person having a role in any transaction or obligation relating to a Letter of Credit, or the existence, nature, quality, quantity, condition, value or other characteristic of any property or services relating to a Letter of Credit;
(g) any failure by such Issuing Lender or any of such Issuing Lender’s Affiliates to issue any Letter of Credit in the form requested by any Loan Party, unless such Issuing Lender has received written notice from such Loan Party of such failure within three (3) Business Days after such Issuing Lender shall have furnished such Loan Party and the Administrative Agent a copy of such Letter of Credit and such error is material and no drawing has been made thereon prior to receipt of such notice;
(h) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Borrower or any of its Subsidiaries;
(i) any breach of this Agreement or any other Loan Document by any party thereto;
(j) the occurrence or continuance of an Insolvency Proceeding with respect to any Loan Party;
(k) the fact that an Event of Default or a Potential Default shall have occurred and be continuing;
(l) the fact that the Revolving Maturity Date shall have passed or this Agreement or the Revolving Credit Commitments or other Commitments hereunder shall have been terminated; and
(m) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing.
2.9.8 Indemnity.
The Borrower hereby agrees to protect, indemnify, pay and save harmless each Issuing Lender and any of its Affiliates that has issued a Letter of Credit from and against any and all claims, demands, liabilities, damages, taxes (subject to the last sentence of this Section 2.9.8 [Indemnity]), penalties, interest, judgments, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which such Issuing Lender or any of such Issuing Lender’s Affiliates may incur or be subject to as a consequence, direct or indirect, of the issuance of any Letter of Credit issued by it, other than as a result of the gross negligence or willful misconduct of such Issuing Lender as determined by a final non-appealable judgment of a court of competent jurisdiction. This Section 2.9.8 [Indemnity] shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.
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2.9.9 Liability for Acts and Omissions.
(a) As between any Loan Party and an Issuing Lender, or such Issuing Lender’s Affiliates, such Loan Party assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit. In furtherance and not in limitation of the foregoing, no Issuing Lender shall be responsible for any of the following including any losses or damages to any Loan Party or other Person or property relating therefrom: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document (including all sight drafts, certificates and all other instruments) submitted by any party in connection with the application for an issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if such Issuing Lender or such Issuing Lender’s Affiliates shall have been notified thereof); (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of any Loan Party against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among any Loan Party and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of such Issuing Lender or such Issuing Lender’s Affiliates, as applicable, including any acts of any Official Body, and none of the above shall affect or impair, or prevent the vesting of, any of such Issuing Lender’s or such Issuing Lender’s Affiliates rights or powers hereunder. Nothing in the preceding sentence shall relieve the Issuing Lender from liability for such Issuing Lender’s gross negligence or willful misconduct in connection with actions or omissions described in clauses (i) through (viii) of such sentence, as determined by a final non-appealable judgment of a court of competent jurisdiction. In no event shall any Issuing Lender or any Issuing Lender’s Affiliates be liable to any Loan Party for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses (including attorneys’ fees), or for any damages resulting from any change in the value of any property relating to a Letter of Credit.
(b) Without limiting the generality of the foregoing, each Issuing Lender and each of its Affiliates (i) may rely on any oral or other communication believed in good faith by such Issuing Lender or such Affiliate to have been authorized or given by or on behalf of the applicant for a Letter of Credit or any beneficiary, transferee, or assignee of proceeds thereof; (ii) may honor any presentation if the documents presented appear on their face substantially to comply with the terms and conditions of the relevant Letter of Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit, whether such dishonor was pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had initially been honored, together with any interest paid by such Issuing Lender or its Affiliate; (iv) may honor any drawing that is payable upon presentation of a statement advising negotiation or payment, upon receipt of such statement (even if such statement indicates that a draft or other document is being delivered separately), and shall not be liable for any failure of any such draft or other document to arrive, or to
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conform in any way with the relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming that it rightfully honored under the laws or practices of the place where such bank is located; and (vi) may settle or adjust any claim or demand made on such Issuing Lender or its Affiliate in any way related to any order issued at the applicant’s request to an air carrier, a letter of guarantee or of indemnity issued to a carrier or any similar document (each, an “Order”) and honor any drawing in connection with any Letter of Credit that is the subject to such Order, notwithstanding that any drafts or other documents presented in connection with such Letter of Credit fail to conform in any way with such Letter of Credit. In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by such Issuing Lender or such Issuing Lender’s Affiliates under or in connection with the Letters of Credit issued by it, the Issuer Documents or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall not put such Issuing Lender or such Issuing Lender’s Affiliates under any resulting liability to the Borrower or any Lender, unless such action taken or omitted is found in a final and nonappealable judgment by a court of competent jurisdiction to have constituted gross negligence or willful misconduct.
2.9.10 Cash Collateral Prior to the Revolving Maturity Date.
If the Borrower or any other Loan Party requests the issuance, extension or renewal of any Letter of Credit and such Letter of Credit would have an expiration date which is after the Letter of Credit Maturity Date, no Issuing Lender shall be required to issue, extend or renew such Letter of Credit, but may elect to do so if the requirements of this Section 2.9.10 are satisfied. The Borrower shall, on or before the issuance, extension or renewal of such Letter of Credit, deposit and pledge Cash Collateral for each such Letter of Credit in an amount equal to 103% of the face value of such outstanding Letter of Credit plus the amount of fees that would be due under such Letter of Credit through the expiry date of such Letter of Credit. Such Cash Collateral shall be deposited pursuant to documentation reasonably satisfactory to the Administrative Agent and such Issuing Lender and the Borrower and shall be maintained in blocked deposit accounts at such Issuing Lender. The Borrower hereby grants to the applicable Issuing Lender and the Administrative Agent, on behalf of such Issuing Lender, a security interest in all Cash Collateral pledged to such Issuing Lender pursuant to this Section or otherwise under this Agreement. The Cash Collateral related to a particular Letter of Credit shall be released by the applicable Issuing Lender upon termination or expiration of such Letter of Credit and the reimbursement by the Loan Parties of all amounts drawn thereon and the payment in full of all fees accrued thereon through the date of such expiration or termination. After the Revolving Maturity Date, the Borrower shall pay any and all fees associated with any such Letter of Credit with an expiration date that extends beyond the Revolving Maturity Date directly to the applicable Issuing Lender.
2.9.11 Issuing Lender Reporting Requirements.
Each Issuing Lender shall, on the first Business Day of each month, provide to the Administrative Agent and the Borrower a schedule of the Letters of Credit issued by it, in form and substance satisfactory to the Administrative Agent, showing the date of issuance of each Letter of Credit, the account party, the original face amount (if any), and the expiration date of any Letter of Credit outstanding at any time during the preceding month, and any other information relating to such Letter of Credit that the Administrative Agent may request.
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2.10 Borrowings to Repay Swing Loans.
Upon the making of a Swing Loan (whether before or after the occurrence of a Potential Default or an Event of Default and regardless of whether a settlement has been requested with respect to such Swing Loan), each Revolving Lender shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably purchased from the Swingline Lender, without recourse or warranty, an undivided interest and participation in such Swing Loan in proportion to its Ratable Share. The Swingline Lender may, at its option, exercisable at any time for any reason whatsoever, demand repayment of the Swing Loans, and each Revolving Lender shall immediately either (A) make a Revolving Credit Loan in an amount equal to such Revolving Lender’s Ratable Share of the aggregate principal amount of the outstanding Swing Loans, plus, if the Swingline Lender so requests, accrued interest thereon; provided that no Revolving Lender shall be obligated in any event to make Revolving Credit Loans in excess of the amount that would cause its Revolving Exposure to exceed its Revolving Credit Commitment or (B) during the continuance of an Insolvency Proceeding with respect to the Borrower, fund such Swing Loan participations by paying the Swingline Lender such Revolving Lender’s Ratable Share of the outstanding Swing Loans. Revolving Credit Loans made pursuant to the preceding sentence shall bear interest at the applicable Base Rate Option and shall be deemed to have been properly requested in accordance with Section 2.5.1 [Loan Requests] without regard to any of the requirements of that provision. The Administrative Agent on behalf of the Swingline Lender shall provide notice to the Revolving Lenders (which may be telephonic or written notice by letter, facsimile or email (in “pdf,” “tif” or similar format)) no later than 11:00 a.m. on any Business Day that such Revolving Credit Loans are to be made under this Section 2.10 [Borrowing to Repay Swing Loans] and of the apportionment among the Revolving Lenders, and the Revolving Lenders shall be unconditionally obligated to fund such Revolving Credit Loans (whether or not the conditions specified in Section 2.5 [Loan Requests] or Section 7.2 [Each Additional Loan or Letter of Credit] are then satisfied) to the Administrative Agent on behalf of the Swingline Lender, no later than 3:00 p.m. on the Settlement Date.
2.11 Incremental Facilities.
2.11.1 Establishment of Incremental Facilities.
The Borrower may by written notice to the Administrative Agent from time to time on or after the Amendment No. 6 Effective Date elect to seek (a) commitments to increase the Revolving Credit Commitments (any such increase a “Revolving Commitment Increase”) or (b) commitments to establish a Class of Term Loans or increase any then-existing Class of Term Loans that are “A” loans and that are, as reasonably determined by the Administrative Agent, primarily syndicated to, or made by, regulated commercial banks (an “Incremental Term Loan Commitment”; each Incremental Term Loan Commitment and Revolving Commitment Increase, an “Incremental Facility”) by an aggregate amount for all Incremental Facilities not in excess of $150,000,000. Each such notice shall specify the date (each, an “Incremental Effective Date”) on which the Borrower proposes that the applicable Incremental Facility shall be effective, which shall be a date not less than five (5) Business Days after the date on which such notice is delivered to the Administrative Agent.
No Person that is a Lender prior to the effectiveness of any applicable Additional Credit Extension Amendment (a “Current Lender”) with respect to any Incremental Facility shall be obligated to provide any such Incremental Facility and any commitment of any Current Lender to provide an Incremental Facility shall be in the sole discretion of such Current Lender.
2.11.2 Conditions.
Each Incremental Facility shall become effective, as of the applicable Incremental Effective Date; provided that:
(a) before and after giving effect to such Incremental Facility, each of the conditions set forth in Section 7.2 [Each Additional Loan or Letter of Credit] shall be satisfied;
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(b) before and after giving effect to such Incremental Facility, no Potential Default or Event of Default has occurred and is continuing;
(c) the Loan Parties shall deliver to each Agent on or before the effective date of such Incremental Facility the following documents in a form reasonably acceptable to the Administrative Agent and the Collateral Agent: (1) certifications of their corporate secretaries with attached resolutions certifying that the Incremental Facility has been approved by the Loan Parties, (2) opinions of counsel, addressed to the Administrative Agent and the Lenders addressing the authorization, execution and enforceability of the Loan Documents executed in connection with such Incremental Facility, and (3) if requested by the Collateral Agent, amendments to the Mortgages executed and delivered by the applicable Loan Parties to the Collateral Agent for the benefit of the Secured Parties to reflect the Incremental Facility, in form and substance reasonably satisfactory to the Collateral Agent, together with (A) the Required Flood Materials and (B) local counsel opinions regarding the due authorization, execution, delivery, and enforceability of such mortgage amendments. The Loan Parties shall cause the amendments described in clause (3) above to be properly recorded and/or filed in the applicable filing or recording offices; and
(d) the Borrower shall deliver to each Agent a certificate dated as of the Incremental Effective Date signed by an Authorized Officer of the Borrower certifying that the conditions set forth in clauses (a) and (b) above are satisfied.
2.11.3 Terms of Revolving Commitment Increases.
Each Revolving Commitment Increase shall be documented as an increase to the existing Class of Revolving Credit Commitments and shall be on the same terms (other than with respect to any upfront fees) as the existing Class. Each Revolving Commitment Increase shall be not less than $5,000,000 (or such lesser amount that shall be reasonably satisfactory to the Administrative Agent) and shall be in integral multiples of $1,000,000 (or such lesser amount that shall be reasonably satisfactory to the Administrative Agent) in excess thereof.
2.11.4 Terms of Incremental Term Loan Commitments.
The terms and provisions of the Incremental Term Loan Commitments and the Term Loans made pursuant thereto shall be as follows:
(a) any Term Loans shall be secured on a pari passu basis on the Collateral with the Revolving Credit Loans and any other Incremental Facilities and shall not be guaranteed by any Subsidiaries of the Borrower that are not Guarantors and all Liens granted to secure such Term Loans shall be granted pursuant to the Security Documents;
(b) the final maturity date of all Term Loans shall be no earlier than the latest Revolving Maturity Date;
(c) the amount of any Incremental Term Loans shall not be less than $10,000,000 (or such lesser amount that shall be reasonably satisfactory to the Administrative Agent) and shall be in integral multiples of $1,000,000 (or such lesser amount that shall be reasonably satisfactory to the Administrative Agent) in excess thereof;
(d) the pricing and amortization of the Incremental Term Loans shall be determined by the Borrower and the relevant Incremental Lenders;
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(e) other than the amortization described above, Incremental Term Loans shall not be subject to mandatory prepayments, except that, at the determination of the Borrower and the relevant Incremental Lenders, Incremental Term Loans may be subject to usual and customary mandatory prepayments for asset sales, casualty events and incurrence of non-permitted Indebtedness as may be mutually agreed with between the Borrower and such Incremental Lenders; provided, further, that in the case of any such mandatory prepayment, such mandatory prepayment shall apply equally to the Revolving Credit Loans and the proceeds thereof shall be applied ratably to outstanding Term Loans, Revolving Credit Loans and Swing Loans (but for the avoidance of doubt, such application to Revolving Credit Loans and Swing Loans shall not require a reduction in Revolving Credit Commitments);
(f) all other terms of the Term Loans shall be reasonably satisfactory to the Borrower, the relevant Incremental Lenders and the Administrative Agent; provided Incremental Term Loans shall not have any prepayment premiums applicable thereto.
2.11.5 Notes.
The Borrower shall execute and deliver (1) to each Current Lender with a Revolving Commitment Increase that requests a Revolving Credit Note, a replacement Revolving Credit Note reflecting the new amount of such Revolving Lender’s Revolving Credit Commitment of such Class after giving effect to its Revolving Commitment Increase (and the prior Note issued to such Lender shall be deemed to be canceled and shall be returned to the Borrower as soon as practicable), (2) to each new Revolving Lender with an Revolving Commitment Increase that requests a Revolving Credit Note, a Revolving Credit Note reflecting the amount of such Revolving Lender’s Revolving Credit Commitment of such Class, (3) and (3) to each Incremental Term Lender that requests a Term Note evidencing its Incremental Term Loans, a Term Note reflecting the amount of such Term Lender’s Incremental Term Loans, as applicable.
2.11.6 Approval of Incremental Lenders.
Each Incremental Lender shall be subject to the consents specified in Section 11.8.2(c) [Required Consents] as if the Incremental Facility were an assignment.
2.11.7 Documentation.
Each Incremental Facility shall be documented by an Additional Credit Extension Amendment executed by the relevant Incremental Lenders providing such Incremental Facility (and the other Persons specified in the definition of “Additional Credit Extension Amendment” but no other existing Lender), and the Additional Credit Extension Amendment may provide for such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section 2.11. This Section 2.11 shall supersede any provisions in Section 5.2 [Pro Rata Treatment of Lenders], Section 5.3 [Sharing of Payments by Lenders] or Section 11.1 [Modifications, Amendments or Waivers] to the contrary (but shall be in addition to and not in lieu of the first proviso of Section 11.1 [Modifications, Amendments or Waivers]).
2.11.8 Syndication.
In the event that the Borrower elects to request an Incremental Facility, the Borrower and the Administrative Agent agree to mutually develop a syndication strategy, including timelines for commitments, to the extent the Administrative Agent agrees to assist in such syndication.
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2.11.9 Treatment of Outstanding Loans and Letters of Credit.
(i) Repayment of Outstanding Revolving Credit Loans; Borrowing of New Revolving Credit Loans. On the effective date of each Revolving Commitment Increase, the Borrower shall (x) repay the Revolving Credit Loans then outstanding to each of the Current Lenders to the extent necessary so that after giving effect to the Revolving Commitment Increases each Current Lender that is a Revolving Lender will have its Ratable Share of the outstanding Revolving Credit Loans, subject to the Borrower’s indemnity obligations under Section 5.10 [Indemnity] and (y) borrow Revolving Credit Loans from Incremental Lenders to the extent necessary so that after giving effect to the Revolving Commitment Increases, each such Revolving Lender will have its Ratable Share of the outstanding Revolving Credit Loans. To facilitate the foregoing, the Borrower may, subject to its compliance with the other terms of this Agreement, borrow new Revolving Credit Loans on the effective date of such increase. The Administrative Agent is hereby authorized to update Schedule 1.1(B) to reflect the increase in Revolving Credit Commitments.
(ii) Outstanding Letters of Credit; Repayment of Outstanding Revolving Credit Loans; Borrowing of New Revolving Credit Loans. On the effective date of each Revolving Commitment Increase, (a) each Current Lender that is a Revolving Lender shall be deemed to have sold its existing participation in each then outstanding Letter of Credit and purchased a participation in each then outstanding Letter of Credit equal to its Ratable Share of such Letters of Credit, and (b) each Incremental Lender will be deemed to have purchased a participation in each then outstanding Letter of Credit equal to its Ratable Share of such Letter of Credit. All fees shall accrue and be paid on the Letters of Credit based upon each Revolving Lender’s participation therein over the relevant period of time. To the extent necessary to enable each of the Current Lenders and the Incremental Lenders to own a Ratable Share of the Participation Advances after any increase in the Revolving Credit Commitments, (a) the Current Lenders that are Revolving Lenders will sell a portion of its Participation Advances, and (b) the Incremental Lenders with commitments to make Revolving Commitment Increases will acquire Participation Advances (and will pay to the Administrative Agent, for the account of each selling Revolving Lender, in immediately available funds, an amount) equal to its Ratable Share of all outstanding Participation Advances. All fees and interest on Participation Advances shall be allocated based upon each Revolving Lender’s ownership therein from time to time.
(iii) Making of Incremental Term Loans. On any Incremental Effective Date on which new Incremental Term Loan Commitments are effective, subject to the satisfaction of the foregoing terms and conditions, each Term Lender of such new Incremental Term Loan Commitments shall make a Term Loan to the Borrower in an amount equal to its Incremental Term Loan Commitment.
(iv) Equal and Ratable Benefit. The Incremental Facilities established pursuant to this paragraph shall constitute Loans and Commitments under, and shall be entitled to all the benefits afforded by, this Agreement and the other Loan Documents, and shall, without limiting the foregoing, benefit equally and ratably from the Guaranties under the Guaranty Agreement and security interests created by the Security Documents. The Loan Parties shall take any actions reasonably required by the Collateral Agent to ensure and/or demonstrate that the Lien and security interests granted by the Security Documents continue to be perfected under the UCC or otherwise after giving effect to the establishment of any such Class of Term Loans or any such new Commitments.
2.12 Extended Term Loans and Extended Revolving Credit Commitments.
(a) The Borrower may at any time and from time to time request that all or a portion of the Term Loans of any Class (the Loans of such applicable Class, the “Existing Term Loans”) be converted into a new Class of Term Loans (the Loans of such applicable Class, the “Extended Term Loans”)
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with terms consistent with this Section 2.12. In order to establish any Extended Term Loans, the Borrower shall provide a notice to the Administrative Agent (a “Term Extension Request”) setting forth the proposed terms of the Extended Term Loans to be established, which shall be identical to those applicable to the Existing Term Loans from which such Extended Term Loans are to be converted except that:
(i) the maturity date of the Extended Term Loans shall be later than the maturity date of the Existing Term Loans and the Weighted Average Life to Maturity of such Extended Term Loans shall be longer than the then remaining Weighted Average Life to Maturity of the Existing Term Loans;
(ii) all or any of the scheduled amortization payments of principal of the Extended Term Loans may be delayed to later dates than the scheduled amortization payments of principal of the Existing Term Loans;
(iii) (A) the interest rates (including through fixed interest rates), interest margins, rate floors, upfront fees, funding discounts, original issue discounts and premiums with respect to the Extended Term Loans may be different than those for the Existing Term Loans and (B) additional fees and/or premiums may be payable to the Extending Lenders providing such Extended Term Loans in addition to any of the items contemplated by the preceding clause (A);
(iv) the Extended Term Loans may have optional prepayment terms (but no call protection or prepayment premiums) and mandatory prepayment terms as may be agreed between the Borrower and the Extending Lenders (so long as such mandatory prepayments would have been permitted by Section 2.11.4(e) [Terms of Incremental Term Loan Commitments]) so long as such Extended Term Loans do not participate on a greater than pro rata basis in any such mandatory prepayments as compared to Lenders of existing Term Loans; provided that in the case of any such mandatory prepayment, such mandatory prepayment shall apply equally to the Revolving Credit Loans and the proceeds thereof shall be applied ratably to outstanding Term Loans, Revolving Credit Loans and Swing Loans (but for the avoidance of doubt, such application to Revolving Credit Loans and Swing Loans shall not require a reduction in Revolving Credit Commitments)and
(v) the Borrower and its Subsidiaries may be subject to covenants and other terms for the benefit of the Extending Lenders that apply only after the Latest Maturity Date (before giving effect to the Extended Term Loans).
(b) The Borrower may at any time and from time to time request that all or a portion of the Revolving Credit Commitments of any Class (the Commitments of such applicable Class, the “Existing Revolving Credit Commitments”) be converted into a new Class of Revolving Credit Commitments (the Commitments of such applicable Class, the “Extended Revolving Credit Commitments”) with terms consistent with this Section 2.12(b). In order to establish any Extended Revolving Credit Commitments, the Borrower shall provide a notice to the Administrative Agent (a “Revolving Extension Request”) setting forth the proposed terms of the Extended Revolving Credit Commitments to be established, which terms shall be identical to those applicable to the Existing Revolving Credit Commitments except that:
(i) the maturity date of the Extended Revolving Credit Commitments shall be later than the maturity date of the Existing Revolving Credit Commitments;
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(ii) (A) the interest rates, interest margins, rate floors, upfront fees, funding discounts, original issue discount and premiums with respect to the Extended Revolving Credit Commitments may be different than those for the Existing Revolving Credit Commitments and/or (B) additional fees and/or premiums may be payable to the Extending Lenders in addition to or in lieu of any of the items contemplated by the preceding subclause (A) and/or (C) the undrawn revolving credit commitment fee rate with respect to the Extended Revolving Credit Commitments may be different than those for the Existing Revolving Credit Commitments; and
(iii) the Borrower and its Subsidiaries may be subject to covenants and other terms for the benefit of the Extending Lenders that apply only after the Latest Maturity Date (before giving effect to the Extended Revolving Credit Commitments).
(c) Each Extension Request shall specify the date (the “Extension Effective Date”) on which the Borrower proposes that the conversion of any Existing Term Loans or Existing Revolving Credit Commitments into Extended Term Loans or Extended Revolving Credit Commitments, as applicable, shall be effective, which shall be a date reasonably satisfactory to the Administrative Agent. Each Lender of Loans of an Existing Class that are requested to be extended shall be offered the opportunity to convert its Existing Term Loans or Existing Revolving Credit Commitments into Extended Term Loans or Extended Revolving Credit Commitments, as applicable, on the same basis as each other Lender of Loans or Commitments of the same Existing Class. Any Lender (to the extent applicable, an “Extending Lender”) wishing to have all or a portion of its Existing Term Loans or Existing Revolving Credit Commitments subject to such Extension Request converted into Extended Term Loans or Extended Revolving Credit Commitments, as applicable, shall notify the Administrative Agent (an “Extension Election”) on or prior to the date specified in such Extension Request of the amount of its Existing Term Loans or Existing Revolving Credit Commitments subject to such Extension Request that it has elected to convert into Extended Term Loans or Extended Revolving Credit Commitments, as applicable. In the event that the aggregate portion of the Existing Term Loans or Existing Revolving Credit Commitments subject to Extension Elections exceeds the amount of the Extended Term Loans or Extended Revolving Credit Commitments, as applicable, requested pursuant to the Extension Request, the portion of the Existing Term Loans or Existing Revolving Credit Commitments converted shall be allocated on a pro rata basis based on the amount of the Existing Term Loans or Existing Revolving Credit Commitments, as applicable, included in each such Extension Election. Notwithstanding the conversion of any Existing Revolving Credit Commitment into an Extended Revolving Credit Commitment, such Extended Revolving Credit Commitment shall be treated identically with all Existing Revolving Credit Commitments for purposes of the obligations of a Revolving Lender in respect of Swing Loans under Section 2.10 [Borrowings to Repay Swing Loans] and Letters of Credit under Section 2.9 [Letters of Credit], except that the applicable Additional Credit Extension Amendment may provide that the maturity date for Swing Loans and/or the Letters of Credit may be extended and the related obligations to make Swing Loans and issue Letters of Credit may be continued so long as the Swingline Lender and/or the applicable Issuing Lender, as applicable, have consented to such extensions in their sole discretion (it being understood that no consent of any other Lender shall be required in connection with any such extension).
(d) An Extended Class shall be established pursuant to an Additional Credit Extension Amendment as described in Section 2.12(f) below. No Additional Credit Extension Amendment shall provide for any Class of (x) Extended Term Loans in an aggregate principal amount that is less than $10,000,000 or (y) Extended Revolving Credit Commitments in an aggregate principal amount that is less than $5,000,000. In addition to any terms and changes required or permitted by Section 2.12(a), the Additional Credit Extension Amendment shall amend the scheduled amortization payments with respect to the Existing Term Loans from which the Extended Term Loans were converted to reduce each scheduled principal repayment amounts for the Existing Term Loans in the same proportion as the amount of Existing Term Loans to be converted pursuant to such Additional Credit Extension Amendment.
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(e) Notwithstanding anything to the contrary contained in this Agreement, on the Extension Effective Date, (i) the principal amount of each Existing Term Loan shall be deemed reduced by an amount equal to the principal amount converted into an Extended Term Loan, (ii) the amount of each Existing Revolving Credit Commitment shall be deemed reduced by an amount equal to the amount converted into an Extended Revolving Credit Commitment and (iii) if, on any Extension Effective Date, any Revolving Credit Loans of any Extending Lender are outstanding under the applicable Existing Revolving Credit Commitments, such Loans (and any related participations) shall be deemed to be converted into Revolving Credit Loans (and related participations) made pursuant to the Extended Revolving Credit Commitments in the same proportion as such Extending Lender’s Existing Revolving Credit Commitments are converted to Extended Revolving Credit Commitments.
(f) This Section 2.12 shall supersede any provisions in Section 5.2 [Pro Rata Treatment of Lenders], Section 5.3 [Sharing of Payments by Lenders] or Section 11.1 [Modifications, Amendments or Waivers] to the contrary. Each Extended Class shall be documented by an Additional Credit Extension Amendment executed by the Extending Lenders providing such Extended Class (and the other Persons specified in the definition of “Additional Credit Extension Amendment” but no other existing Lender), and the Additional Credit Extension Amendment may provide for such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section 2.12.
2.13 Refinancing Term Loans
2.13.1 The Borrower may at any time and from time to time, by written notice to Administrative Agent, request the establishment of one or more additional Classes of Term Loans under this Agreement or an increase to an existing Class of Term Loans under this Agreement (“Refinancing Term Loans”); provided that:
(i) the proceeds of such Refinancing Term Loans shall be used, concurrently or substantially concurrently with the incurrence thereof, solely to refinance all or any portion of any outstanding Term Loans of any Class (such refinanced Term Loans, the “Refinanced Term Loans” and such Class, the “Refinanced Term Loan Class”);
(ii) each Class of Refinancing Term Loans shall be in an aggregate amount of at least $25,000,000 (or such lesser amount necessary to repay the Refinanced Term Loan Class in full);
(iii) such Refinancing Term Loans shall be in an aggregate principal amount not greater than the aggregate principal amount of Refinanced Term Loans plus any accrued interest, premiums, fees, costs and expenses related thereto (including any original issue discount or upfront fees);
(iv) the maturity date of such Refinancing Term Loans shall be later than the Maturity Date of the Refinanced Term Loans, and the Weighted Average Life to Maturity of such Refinancing Term Loans shall be longer than the then remaining Weighted Average Life to Maturity of each Refinanced Term Loan Class;
(v) (A) the rate floors, upfront fees, funding discounts, original issue discounts and premiums with respect to the Refinancing Term Loans may be different than those for the Refinanced Term Loans and (B) additional fees and/or premiums may be payable to the Refinancing Term Lenders providing such Refinancing Term Loans in addition to any of the items contemplated by the preceding clause (A);
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(vi) the Refinancing Term Loans may have optional prepayment terms (but no call protection or prepayment premiums) and mandatory prepayment terms as may be agreed between the Borrower and the Refinancing Term Lenders so long as such Refinancing Term Loans do not participate on a greater than pro rata basis in any such voluntary or mandatory prepayments as compared to the Refinanced Term Loan Class;
(vii) the covenants and other terms applicable to such Refinancing Term Loans (excluding those terms described in the clauses (i), (iii), (iv), (v) and (vi) above), which shall be as agreed between the Borrower and the Refinancing Term Lenders, shall not be more favorable (when taken as a whole) to the Refinancing Term Lenders than those applicable to Lenders of the Refinanced Term Loan Class, except to the extent such covenants and other terms apply solely to any period after the Latest Maturity Date (before giving effect to the Refinancing Term Loans);
(viii) no Person that is a Current Lender prior to the effectiveness of any applicable Additional Credit Extension Amendment with respect to any Refinancing Term Loans shall be obligated to provide any such Refinancing Term Loans, and any commitment of any Current Lender to provide a Refinancing Term Loans shall be in the sole discretion of such Current Lender; and
(ix) the Refinancing Term Loans shall rank pari passu in right of payment and of security with the existing Loans, on terms and pursuant to documentation applicable to the Term Loans being refinanced; provided, however, that such Refinancing Term Loans shall be secured on a pari passu basis with the Term Loans by the same assets that secure the existing Obligations and shall not be guaranteed by any Subsidiaries of Borrower that are not Guarantors.
2.13.2 Each such notice shall specify (x) the date (each, a “Refinancing Term Loan Effective Date”) on which the Borrower proposes that the Refinancing Term Loans be made, which shall be a date reasonably acceptable to the Administrative Agent and (y) the identity of the Persons (each of which shall be an assignee permitted pursuant to Section 11.8.2 [Assignments by Lenders] (for this purpose treating a Lender of Refinancing Term Loans as if it were an assignee)) whom the Borrower proposes would provide the Refinancing Term Loans and the portion of the Refinancing Term Loans to be provided by each such Person. On each Refinancing Term Loan Effective Date, each Person with a commitment for a Refinancing Term Loan (each such Person, a “Refinancing Term Lender”) shall make a Refinancing Term Loan to the Borrower in a principal amount equal to such Person’s Commitment therefor.
2.13.3 This Section 2.13 shall supersede any provisions in Section 5.2 [Pro Rata Treatment of Lenders], Section 5.3 [Sharing of Payments by Lenders] or Section 11.1 [Modifications, Amendments or Waivers] to the contrary (but shall be in addition to and not in lieu of the first proviso of Section 11.1 [Modifications, Amendments or Waivers]). The Refinancing Term Loans shall be documented by an Additional Credit Extension Amendment executed by the Persons providing the Refinancing Term Loans (and the other Persons specified in the definition of “Additional Credit Extension Amendment” but no other existing Lender), and the Additional Credit Extension Amendment may provide for such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent, the Collateral Agent and the Borrower, to effect the provisions of this Section 2.13.
2.14 Replacement Revolving Credit Commitments.
2.14.1 The Borrower may at any time and from time to time, by written notice to the Administrative Agent, request the establishment of one or more additional Classes of Revolving Credit Commitments (“Replacement Revolving Credit Commitments”) to replace all or a portion of any existing Classes of Revolving Credit Commitments under this Agreement (“Replaced Revolving Credit Commitments”); provided that:
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(i) substantially concurrently with the effectiveness of the Replacement Revolving Credit Commitments, all or an equivalent portion of the Revolving Credit Commitments in effect immediately prior to such effectiveness shall be terminated, and all or an equivalent portion of the Revolving Credit Loans then outstanding, together with all interest thereon, and all other amounts accrued for the benefit of the Revolving Lenders, shall be repaid or paid (it being understood, however, than any Letters of Credit issued and outstanding under the Replaced Revolving Credit Commitments shall be deemed to have been issued under the Replacement Revolving Credit Commitments if the amount of such Letters of Credit would exceed the remaining amount of commitments under the Replaced Revolving Credit Commitments after giving effect to the reduction contemplated hereby);
(ii) such Replacement Revolving Credit Commitments shall be in an aggregate amount not greater than the aggregate amount of Replaced Revolving Credit Commitments to be replaced plus any accrued interest, fees, costs and expenses related thereto (including any upfront fees);
(iii) the maturity date of such Replacement Revolving Credit Commitments shall be no earlier than the Maturity Date of the Replaced Revolving Credit Commitments;
(iv) the Letter of Credit Aggregate Sublimit and the Swingline Cap under such Replacement Revolving Credit Commitments shall be as agreed between the Borrower, the Lenders providing such Replacement Revolving Credit Commitments, the Administrative Agent, the Issuing Lender (or any replacement Issuing Lenders) and the Swingline Lender (or any replacement Swingline Lender);
(v) (A) the rate floors, upfront fees, funding discounts, original issue discounts and premiums with respect to the Replacement Revolving Credit Commitments may be different than those for the Replaced Revolving Credit Commitments and (B) additional fees and/or premiums may be payable to the Replacement Revolving Lenders providing such Replacement Revolving Credit Commitments in addition to any of the items contemplated by the preceding clause (A);
(vi) the Replacement Revolving Credit Commitments may have optional prepayment or commitment reduction terms (including call protection) and mandatory prepayment or commitment reduction terms as may be agreed between the Borrower and the Replacement Revolving Lenders so long as such Replacement Revolving Credit Commitments do not participate on a greater than pro rata basis in any such voluntary or mandatory prepayments or commitment reductions as compared to the Replaced Revolving Credit Commitments;
(vii) the covenants and other terms applicable to such Replacement Revolving Credit Commitment (excluding those terms described in the clauses (i), (iii), (iv), (v) and (vi) above), which shall be as agreed between the Borrower and the Replacement Revolving Lenders, shall not be more favorable (when taken as a whole) to the Replacement Revolving Lenders than those applicable to the Lenders with Replaced Revolving Credit Commitments, except to the extent such covenants and other terms apply solely to any period after the Revolving Maturity Date (before giving effect to the Replacement Revolving Credit Commitments);
(viii) no Person that is a Lender prior to the effectiveness of any applicable Additional Credit Extension Amendment with respect to any Replacement Revolving Credit Commitments shall be obligated to provide any such Replacement Revolving Credit Commitments, and any commitment of any Current Lender to provide a Replacement Revolving Credit Commitments shall be in the sole discretion of such Current Lender; and
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(ix) the Revolving Credit Loans made pursuant to Replacement Revolving Credit Commitments shall rank pari passu in right of payment and of security with the Revolving Credit Loans made pursuant to the Replaced Revolving Credit Commitments.
2.14.2 Each such notice shall specify (x) the date on which the Borrower proposes that the Replacement Revolving Credit Commitments become effective, which shall be a date reasonably acceptable to the Administrative Agent and (y) the identity of the Persons (each of which shall be an assignee permitted pursuant to Section 11.8.2 [Assignments by Lenders] (for this purpose treating a Lender of Replacement Revolving Credit Commitments as if it were an assignee)) whom the Borrower proposes would provide the Replacement Revolving Credit Commitments (each such Person, a “Replacement Revolving Lender”) and the portion of the Replacement Revolving Credit Commitments to be provided by each such Person.
2.14.3 This Section 2.14 shall supersede any provisions in Section 5.2 [Pro Rata Treatment of Lenders], Section 5.3 [Sharing of Payments by Lenders] or Section 11.1 [Modifications, Amendments or Waivers] to the contrary. The Replacement Revolving Credit Commitments shall be documented by an Additional Credit Extension Amendment executed by the Persons providing the Replacement Revolving Credit Commitments (and the other Persons specified in the definition of “Additional Credit Extension Amendment” but no other existing Lender), and the Additional Credit Extension Amendment may provide for such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent, the Collateral Agent and the Borrower, to effect the provisions of this Section 2.14.
2.15 Defaulting Lenders.
(a) Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(i) fees shall cease to accrue on the unfunded portion of the Commitment of such Defaulting Lender pursuant to Section 2.3 [Commitment Fees];
(ii) the Commitment and outstanding Loans of such Defaulting Lender shall not be included in any vote of Lenders except as required by Section 11.1.5 [Defaulting Lenders];
(iii) if any Swing Loans are outstanding or any Letter of Credit Obligations exist at the time such Lender becomes a Defaulting Lender, then:
(A) all or any part of the outstanding Swing Loans and Letter of Credit Obligations of such Defaulting Lender shall be reallocated among the non-Defaulting Lenders with a Revolving Credit Commitment in accordance with their respective Ratable Shares but only to the extent that (x) the Revolving Facility Usage does not exceed the total of all non-Defaulting Lenders’ Revolving Credit Commitments, and (y) no Potential Default or Event of Default has occurred and is continuing at such time;
(B) if the reallocation described in clause (A) above cannot, or can only partially, be effected, the Borrower shall within one Business Day following notice by the Administrative Agent (x) first, prepay such outstanding Swing Loans, and (y) second, Cash Collateralize for the benefit of the Issuing Lenders (ratably among the Issuing Lenders) the Borrower’s obligations corresponding to such Defaulting Lender’s Letter of Credit Obligations (after giving effect to any partial reallocation pursuant to clause (A) above) in a deposit account held at the Administrative Agent for so long as such Letter of Credit Obligations are outstanding;
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(C) if the Borrower Cash Collateralizes any portion of such Defaulting Lender’s Letter of Credit Obligations pursuant to clause (B) above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.9.2 [Letter of Credit Fees] with respect to such Defaulting Lender’s Letter of Credit Obligations during the period such Defaulting Lender’s Letter of Credit Obligations are cash collateralized;
(D) if the Letter of Credit Obligations of the non-Defaulting Lenders are reallocated pursuant to clause (A) above, then the fees payable to the Revolving Lenders pursuant to Section 2.9.2 [Letter of Credit Fees] shall be adjusted in accordance with such non-Defaulting Lenders’ Ratable Share; and
(E) if all or any portion of such Defaulting Lender’s Letter of Credit Obligations are neither reallocated nor Cash Collateralized pursuant to clause (A) or (B) above, then, without prejudice to any rights or remedies of the Issuing Lender or any other Revolving Lender hereunder, all Letter of Credit Fees payable under Section 2.9.2 [Letter of Credit Fees] with respect to such Defaulting Lender’s Letter of Credit Obligations shall be payable to the Issuing Lenders ((ratably among them) and not to such Defaulting Lender) until and to the extent that such Letter of Credit Obligations are reallocated and/or Cash Collateralized; and
(iv) so long as such Lender is a Defaulting Lender, (x) no Issuing Lender shall be required to issue, amend or increase any Letter of Credit, unless such Issuing Lender is satisfied that the related exposure and the Defaulting Lender’s then outstanding Letter of Credit Obligations will be 100% covered by the Revolving Credit Commitments of the non-Defaulting Lenders and/or cash collateral will be provided by the Borrower in accordance with Section 2.13(a)(iii)(B), and (y) participating interests in any newly made Swing Loan or any newly issued or increased Letter of Credit shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.13(a)(iii)(A) (and such Defaulting Lender shall not participate therein).
(b) In the event that the Administrative Agent, the Borrower, the Swingline Lender and the Issuing Lenders agree in writing that a Defaulting Lender has adequately remedied all matters that caused such Revolving Lender to be a Defaulting Lender, then the Administrative Agent will so notify the parties hereto, and the Ratable Share of the Swing Loans and Letter of Credit Obligations of the Revolving Lenders shall be readjusted to reflect the inclusion of such Revolving Lender’s Commitment, and on such date such Revolving Lender shall purchase at par such of the Loans of the other Revolving Lenders (other than Swing Loans) as the Administrative Agent shall determine may be necessary in order for such Revolving Lender to hold such Loans in accordance with its Ratable Share.
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3. [RESERVED].
4. INTEREST RATES
4.1 Interest Rate Options.
The Borrower shall pay interest in respect of the outstanding unpaid principal amount of the Loans as selected by it from the Base Rate Option or Term SOFR Rate Option set forth below applicable to the Revolving Credit Loans, or the Base Rate Option or the Daily Simple SOFR Option set forth below applicable to the Swing Loans, respectively, it being understood that, subject to the provisions of this Agreement, the Borrower may select different Interest Rate Options and different Interest Periods to apply simultaneously to the Loans comprising different Borrowing Tranches and may convert to or renew one or more Interest Rate Options with respect to all or any portion of the Loans comprising any Borrowing Tranche; provided that (i) there shall not be at any one time outstanding more than ten (10) Borrowing Tranches in the aggregate among all of the Loans and (ii) if an Event of Default or Potential Default exists and is continuing, the Borrower may not request, convert to, or renew the Term SOFR Rate Option for any Loans and the Required Class Lenders of any Class may demand that all existing Borrowing Tranches of such Class bearing interest under the Term SOFR Rate Option shall be converted immediately to the Base Rate Option, subject to the obligation of the Borrower to pay any indemnity under Section 5.10 [Indemnity] in connection with such conversion. If at any time the designated rate applicable to any Loan made by any Lender exceeds such Lender’s highest lawful rate, the rate of interest on such Lender’s Loan shall be limited to such Lender’s highest lawful rate.
4.1.1 Interest Rate Options; Swing Line Interest Rate.
(a) The Borrower shall have the right to select from the following Interest Rate Options applicable to the Loans:
(i) Base Rate Option: A fluctuating rate per annum (computed on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed) equal to the Base Rate plus the Applicable Margin, such interest rate to change automatically from time to time effective as of the effective date of each change in the Base Rate; or
(ii) Term SOFR Rate Option: A rate per annum (computed on the basis of a year of 360 days and actual days elapsed) equal to Adjusted Term SOFR as determined for each applicable Interest Period plus the Applicable Margin.
(iii) Swing Loan Interest Rate: The Swing Loans shall bear interest at (i) the Base Rate Option or (ii) a fluctuating rate per annum (computed on the basis of a year of 360 days and actual days elapsed) equal to Daily Simple SOFR plus the SOFR Adjustment, in each case, plus the Applicable Margin.
4.1.2 Rate Quotations.
The Borrower may call the Administrative Agent on or before the date on which a Loan Request is to be delivered to receive an indication of the rates then in effect, but it is acknowledged that such projection shall not be binding on the Administrative Agent or the applicable Lenders nor affect the rate of interest which thereafter is actually in effect when the election is made.
4.1.3 [Reserved].
4.1.4 Conforming Changes Relating to Term SOFR Rate or Daily Simple SOFR.
With respect to the Term SOFR Rate or Daily Simple SOFR, the Administrative Agent may make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document; provided that, the Administrative Agent shall provide notice to the Borrower and the Lenders of each amendment implementing Conforming Changes reasonably promptly after such amendment becomes effective.
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4.2 Interest Periods.
At any time when the Borrower shall select, convert to or renew a Term SOFR Rate Option, the Borrower shall notify the Administrative Agent thereof at least three (3) Business Days prior to the effective date of such Term SOFR Rate Option by delivering a Loan Request. The notice shall specify an Interest Period during which such Interest Rate Option shall apply. Notwithstanding the preceding sentence, the following provisions shall apply to any selection of, renewal of, or conversion to a Term SOFR Rate Option:
(a) each Borrowing Tranche of Loans under the Term SOFR Rate Option shall be in integral multiples and not less than the respective amounts set forth in Section 2.5.1 [Loan Requests] for borrowings;
(b) in the case of the renewal of a Term SOFR Rate Option at the end of an Interest Period, the first day of the new Interest Period shall be the last day of the preceding Interest Period, without duplication in payment of interest for such day; and
(c) Section 4.5 [Selection of Interest Rate Options] shall apply to any Loan under the Term SOFR Rate Option as to which an interest election has not been made prior to the deadline for delivery of a notice set forth above.
4.3 Interest After Default.
To the extent permitted by Law, upon the occurrence of an Event of Default under Section 9.1.1 [Payments Under Loan Documents], Section 9.1.12 [Involuntary Proceedings] or Section 9.1.13 [Voluntary Proceedings] and until such time such Event of Default under Section 9.1.1 [Payments Under Loan Documents], Section 9.1.12 [Involuntary Proceedings] or Section 9.1.13 [Voluntary Proceedings] shall have been cured or waived, the overdue principal amount of the outstanding Loans and other overdue amounts under this Agreement shall bear interest at a rate per annum equal to the sum of the then-applicable rate of interest plus an additional 2.0% per annum from the time such Obligation or amount becomes due and payable and until it is paid in full.
The Borrower acknowledges that the increase in rates referred to in this Section 4.3 reflects, among other things, the fact that such Loans or other amounts have become a substantially greater risk given their default status and that the Lenders are entitled to additional compensation for such risk; and all such interest shall be payable by the Borrower upon demand by the Administrative Agent.
4.4 Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs.
4.4.1 Term SOFR Rate Unascertainable.
If on any date on which a Term SOFR Rate would otherwise be determined with respect to the applicable Loans and/or Commitments of any Class, the Administrative Agent shall have determined that:
(a) adequate and reasonable means do not exist for ascertaining such Term SOFR Rate, or
(b) a fundamental change has occurred with respect to the Term SOFR Rate (including, without limitation, changes in national or international financial, political or economic conditions), the Administrative Agent shall have the rights specified in Section 4.4.4 [Administrative Agent’s and Lender’s Rights].
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4.4.2 Daily Simple SOFR Unascertainable.
If on any date on which Daily Simple SOFR would otherwise be determined with respect to the applicable Loans and/or Commitments of any Class, the Administrative Agent shall have determined that:
(a) adequate and reasonable means do not exist for ascertaining such Daily Simple SOFR, or
(b) a fundamental change has occurred with respect to Daily Simple SOFR (including, without limitation, changes in national or international financial, political or economic conditions),
the Administrative Agent shall have the rights specified in Section 4.4.4 [Administrative Agent’s and Lender’s Rights].
4.4.3 Illegality; Increased Costs.
If at any time any Lender shall have determined that:
(a) the making, maintenance or funding of any Loan to which a Term SOFR Rate Option or Daily Simple SOFR Option applies has been made impracticable or unlawful by compliance by such Lender in good faith with any Law or any interpretation or application thereof by any Official Body or with any request or directive of any such Official Body (whether or not having the force of Law), or
(b) such Term SOFR Rate Option or Daily Simple SOFR Option will not adequately and fairly reflect the cost to such Lender of the establishment or maintenance of any such Loan,
then the Administrative Agent shall have the rights specified in Section 4.4.4 [Administrative Agent’s and Lender’s Rights].
4.4.4 Administrative Agent’s and Lender’s Rights.
In the case of any event specified in Section 4.4.1 [Term SOFR Rate Unascertainable] or Section 4.4.2 [Daily Simple SOFR Unascertainable] above, the Administrative Agent shall promptly so notify the applicable Lenders and the Borrower thereof, and in the case of an event specified in Section 4.4.3 [Illegality; Increased Costs] above, the applicable Lender shall promptly so notify the Administrative Agent and endorse a certificate to such notice as to the specific circumstances of such notice, and the Administrative Agent shall promptly send copies of such notice and certificate to the other applicable Lenders and the Borrower. Upon such date as shall be specified in such notice (which shall not be earlier than the date such notice is given), the obligation of (A) the Lenders, in the case of such given by the Administrative Agent or (B) such Lender, in the case of such notice given by such Lender, to allow the Borrower to select, convert to or renew a Term SOFR Rate Loan or Daily Simple SOFR Loan shall be suspended until the Administrative Agent shall have later notified the Borrower, or such Lender shall have later notified the Administrative Agent, of the Administrative Agent’s or such Lender’s, as the case may be, determination that the circumstances giving rise to such previous determination no longer exist. If at
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any time the Administrative Agent makes a determination under Section 4.4.1 [Term SOFR Rate Unascertainable] or Section 4.4.2 [Daily Simple SOFR Unascertainable] and the Borrower has previously notified the Administrative Agent of its selection of, conversion to or renewal of a Term SOFR Rate Option or Daily Simple SOFR Option and such Term SOFR Rate Option or Daily Simple SOFR Option, as applicable, has not yet gone into effect, such notification shall be deemed to provide for selection of, conversion to or renewal of the Base Rate Option otherwise available with respect to such Loans. If any Lender notifies the Administrative Agent of a determination under Section 4.4.3 [Illegality; Increased Costs], the Borrower shall, subject to the Borrower’s indemnification Obligations under Section 5.10 [Indemnity], as to any Loan of such Lender to which a Term SOFR Rate Option or Daily Simple SOFR Option applies, on the date specified in such notice either convert such Loan to the Base Rate Option otherwise available with respect to such Loan or prepay such Loan in accordance with Section 5.6 [Voluntary Prepayments]. Absent due notice from the Borrower of conversion or prepayment, such Loan shall automatically be converted to the Base Rate Option otherwise available with respect to such Loan upon such specified date.
4.5 Selection of Interest Rate Options.
If the Borrower fails to select a new Interest Period to apply to any Borrowing Tranche of Loans under the Term SOFR Rate Option at the expiration of an existing Interest Period applicable to such Borrowing Tranche in accordance with the provisions of Section 4.2 [Interest Periods], the Borrower shall be deemed to have selected the Term SOFR Rate Option with an Interest Period of one month, commencing upon the last day of the existing Interest Period. If the Borrower provides any Loan Request related to a Loan at the Term SOFR Rate Option but fails to identify an Interest Period therefor, such Loan Request shall be deemed to request an Interest Period of one (1) month. Any Loan Request that fails to select an Interest Rate Option shall be deemed to be a request for the Base Rate Option.
4.6 Benchmark Replacement Setting.
(a) Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document (and, for the avoidance of doubt, any agreement executed in connection with a Specified Swap Agreement shall be deemed not to be a “Loan Document” for purposes of this Section 4.6), if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent have not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.
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(b) Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, the Administrative Agent may make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.
(c) Notices; Standards for Decisions and Determinations. The Administrative Agent will promptly notify the Borrower and the Lenders of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. The Administrative Agent will notify the Borrower of (x) the removal or reinstatement of any tenor of a Benchmark pursuant to paragraph (d) below and (y) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 4.6, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 4.6.
(d) Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including Term SOFR) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in their reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative, then the Administrative Agent may modify the definition of “Interest Period” (or any similar or analogous provision) for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative for a Benchmark (including a Benchmark Replacement), then the Administrative Agent may modify the definition of “Interest Period” (or any similar or analogous provision) for all Benchmark settings at or after such time to reinstate such previously removed tenor.
(e) Benchmark Unavailability Period. Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any pending request for a Loan bearing interest based on the Term SOFR Rate or Daily Simple SOFR, conversion to or continuation of Loans bearing interest based on the Term SOFR Rate or Daily Simple SOFR to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any such request into a request for a Loan of or conversion to Loans bearing interest under the Base Rate Option. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of the Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of the Base Rate.
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(f) Certain Defined Terms. As used in this Section 4.6:
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate or is based on a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an Interest Period pursuant to this Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark pursuant to this Agreement, in each case, as of such date and not including, for the avoidance of doubt, any tenor of such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 4.6(d).
“Benchmark” means, initially, either the Term SOFR Rate or Daily Simple SOFR; provided that if a Benchmark Transition Event and its related Benchmark Replacement Date has occurred with respect to the Term SOFR Rate or Daily Simple SOFR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 4.6(a).
“Benchmark Replacement” means, with respect to any Benchmark Transition Event, (a) in the case of the replacement of the Term SOFR Rate, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date:
| (1) | the sum of: (A) Daily Simple SOFR and (B) the SOFR Adjustment; |
| (2) | the sum of: (A) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower, giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated syndicated credit facilities at such time and (B) the related Benchmark Replacement Adjustment; |
| (b) | in the case of the replacement of Daily Simple SOFR, the sum of: (A) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower, giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated syndicated credit facilities at such time and (B) the related Benchmark Replacement Adjustment; |
provided that, if the Benchmark Replacement as determined pursuant to clause (a)(2) or (b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents; and, provided, further, that any Benchmark Replacement shall be administratively feasible as determined by the Administrative Agent in its sole discretion.
“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower, giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities at such time.
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“Benchmark Replacement Date” means a date and time determined by the Administrative Agent, which date shall be no later than the earlier to occur of the following events with respect to the then-current Benchmark:
| (1) | in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or |
| (2) | in the case of clause (3) of the definition of “Benchmark Transition Event,” the date determined by the Administrative Agent, which date shall promptly follow the date of the public statement or publication of information referenced therein. |
For the avoidance of doubt, the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:
| (1) | a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); |
| (2) | a public statement or publication of information by an Official Body having jurisdiction over the Administrative Agent, the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or |
| (3) | a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) or an Official Body having jurisdiction over the Administrative Agent announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative. |
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For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Unavailability Period” means the period (if any) (x) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with this Section 4.6 and (y) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with this Section 4.6.
“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the modification, amendment or renewal of this Agreement or otherwise) with respect to the Term SOFR Rate or Daily Simple SOFR, as applicable, or, if no floor is specified, zero.
“Relevant Governmental Body” means the Federal Reserve Board or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board or the Federal Reserve Bank of New York, or any successor thereto.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
5. PAYMENTS
5.1 Payments.
All payments and prepayments to be made in respect of principal, interest, Commitment Fees, Letter of Credit Fees, the Administrative Agent’s Fee or other fees or amounts due from the Borrower hereunder shall be payable prior to 1:00 p.m. on the date when due without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived by the Borrower, and without set-off, counterclaim or other deduction of any nature, and an action therefor shall immediately accrue. All payments shall be made in U.S. Dollars and in immediately available funds. Except as otherwise expressly provided herein, all such payments shall be made to the Administrative Agent at its Principal Office for the account of the Swingline Lender with respect to the Swing Loans and for the ratable accounts of the applicable Lenders with respect to the Revolving Credit Loans or Term Loans, and the Administrative Agent shall promptly distribute such amounts to the appropriate Lenders in immediately available funds; provided that in the event payments are received by 1:00 p.m. by the Administrative Agent with respect to the Loans and such payments are not distributed to the applicable Lenders on the same day received by the Administrative Agent, the Administrative Agent shall pay the appropriate Lenders interest at the Federal Funds Effective Rate with respect to the amount of such payments for each day held by the Administrative Agent and not distributed to the Lenders. The Administrative Agent’s and each applicable Lender’s statement of account, ledger or other relevant record shall, in the absence of manifest error, be conclusive as the statement of the amount of principal of and interest on the Loans and other amounts owing under this Agreement and shall be deemed an “account stated.”
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5.2 Pro Rata Treatment of Lenders.
Each Borrowing Tranche shall be allocated to each Lender according to its Ratable Share, and each selection of, conversion to or renewal of any Interest Rate Option and each payment or prepayment by the Borrower with respect to principal, interest, Commitment Fees, Letter of Credit Fees, or other fees (except for the Administrative Agent’s Fee and the fees payable to the Issuing Lender pursuant to Section 2.9.2 [Letter of Credit Fees]) or amounts due from the Borrower hereunder to the Lenders with respect to the Revolving Credit Commitments and the Loans, shall (except as otherwise may be provided with respect to a Defaulting Lender and except as provided in Section 4.4.4 [Administrative Agent’s and Lender’s Rights] in the case of an event specified in Section 4.4 [Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs], Section 5.6.2 [Replacement of a Lender] or Section 5.8 [Increased Costs]) be payable ratably among the Lenders of the applicable Class entitled to such payment in accordance with the amount of principal, interest, Commitment Fees, Letter of Credit Fees, and other fees or amounts then due to such Lender as set forth in this Agreement. Notwithstanding any of the foregoing, each borrowing or payment or prepayment by the Borrower of principal, interest, fees or other amounts from the Borrower with respect to Swing Loans shall be made by or to the Swingline Lender according to Section 2.10 [Borrowings to Repay Swing Loans].
5.3 Sharing of Payments by Lenders.
If any Lender shall, by exercising any right of setoff, counterclaim or banker’s lien, by receipt of voluntary payment, by realization upon security, or by any other non-pro rata source, obtain payment in respect of any principal of or interest on any of its Loans or other obligations hereunder resulting in such Lender’s receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other such obligations greater than the pro rata share of the amount such Lender is entitled thereto, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them, provided that:
(i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, together with interest or other amounts, if any, required by Law (including court order) to be paid by the Lender or the holder making such purchase; and
(ii) the provisions of this Section 5.3 shall not be construed to apply to (x) any payment made by the Loan Parties pursuant to and in accordance with the express terms of the Loan Documents or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or Participation Advances to any assignee or participant, other than to the Borrower or any Subsidiary thereof (as to which the provisions of this Section 5.3 shall apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against each Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Loan Party in the amount of such participation.
5.4 Presumptions by Administrative Agent.
Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the applicable Lenders or, in the case of the Administrative Agent, the Issuing Lender hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the applicable
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Lenders or, in the case of the Administrative Agent, the Issuing Lender, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the applicable Lenders or, in the case of the Administrative Agent, the Issuing Lender, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or, in the case of the Administrative Agent, the Issuing Lender, with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
5.5 Interest Payment Dates.
Interest on Loans to which the Base Rate Option or Daily Simple SOFR Option applies shall be due and payable in arrears on each Payment Date. Interest on Loans to which the Term SOFR Rate Option applies shall be due and payable on the last day of each Interest Period for those Loans and, if such Interest Period is longer than three (3) Months, also on each date that falls every three (3) Months after the beginning of such Interest Period. Mandatory prepayments of Term Loans under Section 5.7 [Mandatory Prepayments] shall be accompanied by accrued interest on the principal prepaid. Interest on the principal amount of each Loan or other monetary Obligation shall be due and payable on demand after such principal amount or other monetary Obligation becomes due and payable (whether on the stated Maturity Date, upon acceleration or otherwise). For the avoidance of doubt, all interest on Loans which have accrued but are unpaid as of the Amendment No. 6 Effective Date shall be payable on the Payment Date next occurring following the Amendment No. 6 Effective Date.
5.6 Voluntary Prepayments.
5.6.1 Right to Prepay.
So long as the Borrower has repaid any unreimbursed LC Disbursements, the Borrower shall have the right at its option from time to time to prepay the Loans in whole or part, without premium or penalty (except as provided in Section 5.6.2 [Replacement of a Lender] below, in Section 5.8 [Increased Costs] or Section 5.10 [Indemnity]). Whenever the Borrower desires to prepay any part of the Loans, it shall provide a prepayment notice to the Administrative Agent by 1:00 p.m. at least three (3) Business Days prior to the date of prepayment of the Loans to which the Term SOFR Rate Option applies or no later than 11:00 a.m. on the date of prepayment of Loans to which the Base Rate Option applies, setting forth the following information:
(a) the date, which shall be a Business Day, on which the proposed prepayment is to be made;
(b) a statement indicating the application of the prepayment among the Classes of Loans;
(c) a statement indicating the application of the prepayment between Loans to which the Base Rate Option applies, Loans to which the Term SOFR Rate Option applies and, solely with respect to Swing Loans, Loans to which the Daily Simple SOFR Option applies; and
(d) the total principal amount of such prepayment; provided that any partial prepayment of the Loans of any Class shall be in an amount not less than (i) with respect to Swing Loans, $100,000 and (ii) in the case of Loans of any other Class, $5,000,000.
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All prepayment notices shall be irrevocable, except that any notice of voluntary prepayment may state that such notice is conditional upon the consummation of a financing transaction, in which case such notice of prepayment may be revoked or delayed by the Borrower (by notice to the Administrative Agent on or prior to the specified date of prepayment) if such condition is not satisfied. The principal amount of the Loans for which a prepayment notice is given, together with interest on such principal amount, shall be due and payable on the date specified in such prepayment notice as the date on which the proposed prepayment is to be made. All Term Loan prepayments permitted pursuant to this Section 5.6.1 [Right to Prepay] shall be applied to the remaining amortization payments as set forth in the applicable Additional Credit Extension Amendment of each Class as directed in writing by the Borrower to the Administrative Agent (or if no such direction, ratably to the remaining amortization payments of such Class). Except as provided in Section 4.4.4 [Administrative Agent’s and Lender’s Rights], if the Borrower prepays a Loan under this Section 5.6.1 but fails to specify the applicable Borrowing Tranche which the Borrower is prepaying, the prepayment shall be applied (i) first to Swing Loans, second to Revolving Credit Loans and third to Term Loans; and (ii) after giving effect to the allocations in clause (i) above and in the preceding two sentences, first to Loans to which the Base Rate Option applies, then to Loans to which the Daily Simple SOFR Option applies, then to Loans to which the Term SOFR Rate Option applies. Any prepayment hereunder shall be subject to the Borrower’s obligation to indemnify the Lenders under Section 5.10 [Indemnity].
5.6.2 Replacement of a Lender.
In the event any Lender (a) gives notice under Section 4.4 [Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs], (b) requests compensation under Section 5.8 [Increased Costs], or requires the Borrower to pay any Indemnified Taxes or additional amount to any Lender or any Official Body for the account of any Lender pursuant to Section 5.9 [Taxes], (c) is a Defaulting Lender, or (d) is a Non-Consenting Lender referred to in Section 11.1.4 [Non-Consenting Lenders], then in any such event the Borrower may, at its sole expense, upon notice to such Lender and the Administrative Agent, either:
(a) prepay the Loans and Participation Advances of such Lender in whole, together with all interest accrued thereon and any accrued fees and all other amounts payable to such Lender hereunder and under the other Loan Documents (including any amounts under Section 5.10 [Indemnity]), and terminate such Lender’s Commitment; or
(b) at its sole expense, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 11.8 [Successors and Assigns]), all of its interests, rights (other than existing rights to payments pursuant to Section 5.8 [Increased Costs] or 5.9 [Taxes]) and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:
(i) the Borrower or such assignee shall have paid to the Administrative Agent the assignment fee specified in Section 11.8 [Successors and Assigns];
(ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and Participation Advances, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the Loan Documents (including any amounts under Section 5.10 [Indemnity]) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);
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(iii) in the case of any such assignment resulting from a claim for compensation under Section 5.8.1 [Increased Costs Generally] or payments required to be made pursuant to Section 5.9 [Taxes], such assignment will result in a reduction in such compensation or payments thereafter; and
(iv) such assignment does not conflict with applicable Law.
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply. Each Lender agrees that, if the Borrower elects to replace such Lender in accordance with this Section 5.6.2 [Replacement of a Lender], it shall promptly execute and deliver to the Administrative Agent an Assignment and Assumption Agreement to evidence the assignment and shall deliver to the Administrative Agent any Note (if Notes have been issued in respect of such Lender’s Loans) subject to such Assignment and Assumption Agreement; provided that the failure of any such Lender to execute an Assignment and Assumption Agreement shall not render such assignment invalid, and such assignment shall be recorded in the Register if all other requirements of such assignments have been satisfied.
5.6.3 Designation of a Different Lending Office.
If any Lender requests compensation under Section 5.8 [Increased Costs], or the Borrower is or will be required to pay any Indemnified Taxes or additional amounts to any Lender or any Official Body for the account of any Lender pursuant to Section 5.9 [Taxes], then such Lender shall (at the request of the Borrower) use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 5.8 [Increased Costs] or Section 5.9 [Taxes], as the case may be, in the future, and (ii) would not subject such Lender to any material unreimbursed cost or expense and would not otherwise be materially disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
5.7 Mandatory Prepayments.
5.7.1 Revolving Credit Commitments.
If at any time the Revolving Facility Usage is in excess of the Revolving Credit Commitments (as used in this Section 5.7.1, a “deficiency”), the Borrower shall immediately make a principal payment on the Revolving Credit Loans and Swing Loans sufficient to cause the principal balance of such Loans then outstanding to be equal to or less than the Revolving Credit Commitments then in effect. If a deficiency cannot be eliminated pursuant to this Section 5.7.1 by prepayment of the Revolving Credit Loans and Swing Loans as a result of outstanding Letter of Credit Obligations, the Borrower shall also deposit cash collateral with the Administrative Agent, to be held by the Administrative Agent to secure such outstanding Letter of Credit Obligations.
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5.7.2 [Reserved].
5.7.3 [Reserved].
5.7.4 [Reserved].
5.7.5 [Reserved].
5.7.6 Application of Payments; Application Among Interest Rate Options.
Within each Class of Term Loans, prepayments of Term Loans under this Section 5.7 shall be applied to the amortization of the Incremental Term Loans as specified in the applicable Additional Credit Extension Amendment. All prepayments required pursuant to this Section 5.7 shall first be applied among the Interest Rate Options to the principal amount of the Loans subject to the Base Rate Option, then to Loans subject to a Term SOFR Rate Option. In accordance with Section 5.10 [Indemnity], the Borrower shall indemnify the Lenders for any loss or expense, including loss of margin, incurred with respect to any such prepayments applied against Loans subject to a Term SOFR Rate Option on any day other than the last day of the applicable Interest Period.
5.8 Increased Costs.
5.8.1 Increased Costs Generally.
If any Change in Law shall:
(a) impose, modify or deem applicable any reserve, special deposit, liquidity, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender or the Issuing Lender;
(b) subject any Lender or the Issuing Lender to any Tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Loan under the Term SOFR Rate Option made by it, or its other obligations, deposits, reserves, other liabilities or capital attributable thereto, or change the basis of Taxation of payments to such Lender or the Issuing Lender in respect thereof (except for Indemnified Taxes and any Excluded Taxes); or
(c) impose on any Lender, the Issuing Lender or the relevant market any other condition, cost or expense (other than Taxes) affecting this Agreement or any Loan under the Term SOFR Rate Option made by such Lender or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such Recipient of making, converting to, continuing or maintaining any Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Recipient of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Recipient hereunder (whether of principal, interest or any other amount) then, upon request of such Recipient, the Borrower will pay to such Recipient such additional amount or amounts as will compensate such Recipient for such additional costs incurred or reduction suffered; provided that upon the occurrence of any Change in Law imposing a reserve percentage on any interest rate based on SOFR, the Administrative Agent, in its reasonable discretion, may modify the calculation of each such SOFR-based interest rate to add (or otherwise account for) such reserve percentage.
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5.8.2 Capital Requirements.
If any Lender or the Issuing Lender determines that any Change in Law affecting such Lender or the Issuing Lender or any lending office of such Lender or such Lender’s or the Issuing Lender’s holding company, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Lender’s capital or on the capital of such Lender’s or the Issuing Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the Issuing Lender, to a level below that which such Lender or the Issuing Lender or such Lender’s or the Issuing Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the Issuing Lender’s policies and the policies of such Lender’s or the Issuing Lender’s holding company with respect to capital adequacy and liquidity), then from time to time the Borrower will pay to such Lender or the Issuing Lender, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Lender or such Lender’s or the Issuing Lender’s holding company for any such reduction suffered.
5.8.3 Certificates for Reimbursement; Repayment of Outstanding Loans; Borrowing of New Loans.
A certificate of a Lender or the Issuing Lender setting forth the amount or amounts necessary to compensate such Lender or the Issuing Lender or its holding company, as the case may be, as specified in Section 5.8.1 [Increased Costs Generally] or Section 5.8.2 [Capital Requirements] and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender or the Issuing Lender, as the case may be, the amount shown as due on any such certificate within ten (10) Business Days after receipt thereof.
5.8.4 Delay in Requests.
Failure or delay on the part of any Lender or the Issuing Lender to demand compensation pursuant to this Section 5.8 shall not constitute a waiver of such Lender’s or the Issuing Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or the Issuing Lender pursuant to this Section 5.8 for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that such Lender or the Issuing Lender, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the Issuing Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine (9) month period referred to above shall be extended to include the period of retroactive effect thereof).
5.9 Taxes.
5.9.1 Payments Free of Taxes.
All payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Taxes; provided that if any Loan Party or any other applicable withholding agent shall be required by applicable Law to deduct any Taxes from such payments, then (i) if the Tax in question is an Indemnified Tax, the sum payable by the applicable Loan Party shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 5.9) each Lender (or, in the case of a payment made to the Administrative Agent for its own account, the Administrative Agent) receives an amount equal to the sum it would have received had no such deductions been made (provided that, if the applicable withholding agent in respect of an Indemnified Tax or Other
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Tax is a Person other than a Loan Party or the Administrative Agent (e.g., a Lender), the additional amounts required to be paid by a Loan Party under this clause (i) in respect of such Tax shall not be greater than the additional amounts such Loan Party would have been obligated to pay had such Loan Party made payment of such sum directly to the applicable beneficial owner of such payment, provided further, that such Tax would not have been an Excluded Tax had such beneficial owner been a Lender hereunder and had complied with Section 5.9.5 [Status of Lenders]), (ii) the applicable withholding agent shall make such deductions and (iii) the applicable withholding agent shall timely pay the full amount deducted to the relevant Official Body in accordance with applicable Law.
5.9.2 Payment of Other Taxes by the Borrower.
Without limiting the provisions of Section 5.9.1 [Payments Free of Taxes] above, the Borrower shall timely pay any Other Taxes to the relevant Official Body in accordance with applicable Law.
5.9.3 Indemnification by the Borrower.
The Borrower shall indemnify the Administrative Agent and each Lender, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 5.9) paid by the Administrative Agent or such Lender, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Official Body. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
5.9.4 Evidence of Payments.
As soon as practicable after any payment of any Taxes by the Borrower to an Official Body, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Official Body evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
5.9.5 Status of Lenders.
(a) Each Lender that is entitled to an exemption from or reduction of withholding Tax with respect to any payments hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable Law as will permit such payments to be made without withholding or at a reduced rate of withholding. Each such Lender shall, whenever a lapse in time or change in circumstances renders any such documentation (including any specific documentation required below in this Section 5.9.5) obsolete, expired or inaccurate in any respect, deliver promptly to the Borrower and the Administrative Agent updated or other appropriate documentation (including any new documentation reasonably requested by the Borrower or the Administrative Agent) or promptly notify the Borrower and the Administrative Agent in writing of its legal ineligibility to do so. In addition, any Lender, if requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Each Revolving Lender and Term Lender hereby authorizes the Administrative Agent to deliver to the Borrower and to any successor Administrative Agent with respect to the applicable Class of Lenders any documentation provided to the Administrative Agent pursuant to this Section 5.9.5.
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(b) Without limiting the generality of the foregoing:
(i) Each Foreign Lender shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent), whichever of the following is applicable:
(A) two (2) duly completed valid originals of IRS Form W-8BEN or W-8BEN-E (or any successor forms) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party,
(B) two (2) duly completed valid originals of IRS Form W-8ECI (or any successor forms),
(C) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit 5.9.5 to the effect that such Foreign Lender is not (A) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and that no payments in connection with any Loan Document are effectively connected with such Foreign Lender’s conduct of a U.S. trade or business (a “United States Tax Compliance Certificate”) and (y) two duly completed valid originals of IRS Form W-8BEN or W-8BEN-E (or any successor forms),
(D) to the extent a Foreign Lender is not the beneficial owner (for example, where the Foreign Lender is a partnership or a participating Lender), two (2) duly completed valid originals of IRS Form W-8IMY (or any successor forms) of the Foreign Lender, accompanied by a Form W-8ECI, W-8BEN or W-8BEN-E, United States Tax Compliance Certificate, Form W-9, Form W-8IMY or any other required information (or any successor forms) from each beneficial owner that would be required under this Section 5.9.5 [Status of Lenders] if such beneficial owner were a Lender, as applicable (provided that if the Foreign Lender is a partnership (and not a participating Lender) and one or more direct or indirect partners are claiming the portfolio interest exemption, the United States Tax Compliance Certificate may be provided by such Foreign Lender on behalf of such direct or indirect partner(s)), or
(E) two (2) duly completed valid originals of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in United States federal withholding Tax duly completed together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower to determine the withholding or deduction required to be made.
(ii) Each Lender that is a “United States person” as defined in section 7701 of the Code shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent) two (2) originals of an IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding.
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(iii) If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Sections 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their FATCA obligations, to determine whether such Lender has or has not complied with such Lender’s FATCA obligations and to determine the amount, if any, to deduct and withhold from such payment.
(c) Notwithstanding any other provision of this Section 5.9.5, a Lender shall not be required to deliver any documentation that such Lender is not legally eligible to deliver.
5.9.6 Refunds.
If the Administrative Agent or any Lender receives a refund of any Indemnified Taxes as to which it has been indemnified by any Loan Party or with respect to which any Loan Party has paid additional amounts pursuant to this Section 5.9, it shall pay to such Loan Party an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by such Loan Party under this Section 5.9 with respect to the Indemnified Taxes giving rise to such refund), net of all out-of-pocket expenses (including any Taxes imposed with respect to such refund) of the Administrative Agent or such Lender, as the case may be, and without interest (other than any interest paid by the relevant Official Body with respect to such refund); provided that such Loan Party, upon the request of the Administrative Agent or such Lender, shall repay the amount paid over to such Loan Party (plus any penalties, interest or other charges imposed by the relevant Official Body) to the Administrative Agent or such Lender in the event the Administrative Agent or such Lender is required to repay such refund to such Official Body. This Section 5.9 shall not be construed to require the Administrative Agent or any Lender to make available its Tax returns (or any other information relating to its taxes that it deems confidential) to the Borrower or any other Person.
5.9.7 Definition of Lender.
For the avoidance of doubt, the term “Lender” shall, for purposes of this Section 5.9, include any Issuing Lender and any Swingline Lender.
5.9.8 Administrative Agent Forms.
The Administrative Agent (and any assignee or successor) will deliver, to the Borrower, on or prior to the date on which it becomes a party to this Agreement, either (i) (A) two (2) executed copies of IRS Form W-8ECI with respect to any amounts payable to the Administrative Agent for its own account and (B) two (2) duly completed copies of IRS Form W-8IMY (certifying that it is either a “qualified intermediary” or a “U.S. branch” that agrees to be treated as a United States person with respect to payments made to and on behalf of the Lenders) for the amounts the Administrative Agent receives for the account of others, or (ii) two (2) executed copies of IRS Form W-9, whichever is applicable. Notwithstanding anything to the contrary in this Section 5.9.8, the Administrative Agent shall not be required to deliver any documentation that the Administrative Agent is not legally eligible to deliver as a result of any Change in Law after the date hereof.
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5.10 Indemnity.
In addition to the compensation or payments required by Section 5.8 [Increased Costs] or Section 5.9 [Taxes], the Borrower shall indemnify each Lender against all liabilities, losses, claims, damages or expenses (including loss of anticipated profits, any foreign exchange losses and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain any Loan, from fees payable to terminate the deposits from which such funds were obtained or from the performance of any foreign exchange contract) which such Lender sustains or incurs as a consequence of any:
(a) payment, prepayment, conversion or renewal of any Loan to which a Term SOFR Rate Option applies on a day other than the last day of the corresponding Interest Period (whether or not any such payment or prepayment is mandatory, voluntary or automatic and whether or not any such payment or prepayment is then due),
(b) attempt by the Borrower to revoke (expressly, by later inconsistent notices or otherwise) in whole or part any Loan Requests under Section 2.5 [Loan Requests] or Section 4.2 [Interest Periods] or notice relating to prepayments under Section 5.6 [Voluntary Prepayments],
(c) default by the Borrower in the performance or observance of any covenant or condition contained in this Agreement or any other Loan Document, including any failure of the Borrower to pay when due (by acceleration or otherwise) any principal, interest, Commitment Fee or any other amount due hereunder, or
(d) the assignment of any Loans under the Term SOFR Rate Option other than on the last day of the Interest Period as a result of a request by the Borrower pursuant to Section 5.6.2 [Replacement of a Lender]; provided, however, that with respect to this clause (d), the Borrower shall not be required to indemnify any Defaulting Lender whose Loans are being replaced as a result of a request by the Borrower pursuant to Section 5.6.2 [Replacement of a Lender].
If any Lender sustains or incurs any such loss or expense, it shall from time to time notify the Borrower of the amount determined in good faith by such Lender (which determination may include such assumptions, allocations of costs and expenses and averaging or attribution methods as such Lender shall deem reasonable) to be necessary to indemnify such Lender for such loss or expense. Such notice shall set forth in reasonable detail the basis for such determination. Such amount shall be due and payable by the Borrower to such Lender ten (10) Business Days after such notice is given.
5.11 Settlement Date Procedures.
In order to minimize the transfer of funds between the Revolving Lenders and the Administrative Agent, the Borrower may borrow, repay and reborrow Swing Loans and the Swingline Lender may make Swing Loans as provided in Section 2.1.2 [Swing Loans] hereof during the period between Settlement Dates. The Administrative Agent shall notify each Revolving Lender of its Ratable Share of the total of the Revolving Credit Loans and the Swing Loans (each a “Required Share”). On such Settlement Date, each Revolving Lender shall pay to the Administrative Agent the amount equal to the difference between its Required Share and its Revolving Credit Loans, and the Administrative Agent shall pay to each Revolving Lender its Ratable Share of all payments made by the Borrower to the Administrative Agent with respect to the Revolving Credit Loans. The Administrative Agent shall also effect settlement in accordance with the foregoing sentence on the proposed Borrowing Dates for Revolving
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Credit Loans and on dates on which mandatory prepayments of Revolving Credit Loans are due under Section 5.7 [Mandatory Prepayments] and may at its option effect settlement on any other Business Day. These settlement procedures are established solely as a matter of administrative convenience, and nothing contained in this Section 5.11 shall relieve the Revolving Lenders of their obligations to fund Revolving Credit Loans on dates other than a Settlement Date pursuant to Section 2.1.2 [Swing Loans]. The Administrative Agent may at any time at its option for any reason whatsoever require each Revolving Lender to pay immediately to the Administrative Agent such Revolving Lender’s Ratable Share of the outstanding Revolving Credit Loans and each Revolving Lender may at any time require the Administrative Agent to pay immediately to such Revolving Lender its Ratable Share of all payments made by the Borrower to the Administrative Agent with respect to the Revolving Credit Loans.
6. REPRESENTATIONS AND WARRANTIES
The Loan Parties, jointly and severally, represent and warrant to each Agent and each of the Lenders as follows:
6.1 Organization and Qualification.
Each Loan Party is a corporation, partnership or limited liability company duly organized, validly existing and in good standing (if the concept of “good standing” is recognized under the laws of the applicable jurisdiction with respect to such Loan Party) under the laws of its jurisdiction of organization. Each Loan Party has the lawful power to own or lease its properties and to conduct its business in which it is currently engaged, except where the failure to have such power would not reasonably be expected to result in any Material Adverse Change. Each Loan Party is duly licensed or qualified and in good standing in each jurisdiction listed on Schedule 6.1 and in all other jurisdictions where the property owned or leased by it or the nature of the business transacted by it or both makes such licensing or qualification necessary except to the extent that the failure to be so duly licensed or qualified or in good standing would not reasonably be expected to result in any Material Adverse Change.
6.2 EEA Financial Institutions.
No Loan Party is an EEA Financial Institution.
6.3 Subsidiaries.
As of the Amendment No. 6 Effective Date, Schedule 6.3 states the name of each Subsidiary of the Borrower, its jurisdiction of incorporation, the issued and outstanding shares (referred to herein as the “Subsidiary Shares”) and the owners thereof if it is a corporation, its outstanding partnership interests (the “Partnership Interests”) if it is a partnership, its outstanding limited liability company interests, interests assigned to managers thereof and the voting rights associated therewith (the “LLC Interests”) if it is a limited liability company, identifies each Subsidiary as either a Restricted Subsidiary or an Unrestricted Subsidiary and for each Restricted Subsidiary whether or not it is a Guarantor and, if it is not a Guarantor, the clause in the definition of “Excluded Subsidiaries” applicable to such Restricted Subsidiary. There are no options, warrants or other rights outstanding to purchase any such Subsidiary Shares, Partnership Interests or LLC Interests except as indicated on Schedule 6.3. As of the Amendment No. 6 Effective Date, CONSOL Innovations does not hold any coal or mining assets.
6.4 Power and Authority.
Each Loan Party has full power to enter into, execute, deliver and carry out this Agreement and the other Loan Documents to which it is a party, to incur the Indebtedness contemplated by the Loan Documents and to perform its Obligations under the Loan Documents to which it is a party, and all such actions have been duly authorized by all necessary proceedings on its part.
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6.5 Validity and Binding Effect.
This Agreement has been duly and validly executed and delivered by each Loan Party, and each other Loan Document which any Loan Party is required to execute and deliver has been duly executed and delivered by such Loan Party. This Agreement and each other Loan Document constitutes legal, valid and binding obligations of each Loan Party which is a party thereto, enforceable against such Loan Party in accordance with its terms, except to the extent that enforceability of any of such Loan Document may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or other similar laws affecting the enforceability of creditors’ rights generally or limiting the right of specific performance.
6.6 No Conflict.
Neither the execution and delivery of this Agreement or the other Loan Documents to which it is a party by any Loan Party nor the consummation of the transactions herein or therein contemplated or compliance with the terms and provisions hereof or thereof by any of them will conflict with, constitute a default under or result in any breach of (i) the terms and conditions of the certificate of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation, limited liability company agreement or other organizational documents of any Loan Party, (ii) any material Law, instrument, order, writ, judgment, injunction or decree to which any Loan Party is a party or by which it is bound or to which it is subject, or result in the creation or enforcement of any Lien, charge or encumbrance whatsoever upon any property (now or hereafter acquired) of any Loan Party (other than Liens granted under the Loan Documents), or (iii) the terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or imposition of (or the obligation to create or impose) any Lien upon any material property or assets of such Loan Party or any of the Restricted Subsidiaries (other than Liens created under the Loan Documents and Liens permitted hereunder) pursuant to the terms of any material indenture, loan agreement, lease agreement, mortgage, deed of trust, agreement or other instrument to which such Loan Party or any of the Restricted Subsidiaries is a party or by which it or any of its property or assets is bound (any such term, covenant, condition or provision, a “Contractual Requirement”), except that certain consents may be required under various contracts and agreements in connection with any attempt to assign such various contracts and agreements pursuant to the assertion of remedies under the Loan Documents.
6.7 Litigation.
There are no actions, suits, proceedings or investigations pending or, to the knowledge of any Responsible Officer of the Borrower, threatened against any Loan Party at law or equity before any Official Body or arbitrator that (a) relate to this Agreement or any other Loan Document or (b) individually or in the aggregate would reasonably be expected to result in any Material Adverse Change. To the knowledge of any Responsible Officer of the Borrower, none of the Loan Parties is in violation of any order, writ, injunction or any decree of any Official Body that (a) relate to this Agreement or any other Loan Document or (b) would reasonably be expected to result in any Material Adverse Change.
6.8 Title to Properties.
Each Loan Party has good and marketable title to or valid leasehold interest in all properties, assets and other rights, which it purports to own or lease or which are reflected as owned or leased on its books and records, free and clear of all Liens and encumbrances except Permitted Liens, and subject to the terms and conditions of the applicable leases or conveyance instrument, except to the extent that the failure to hold such title or interest, either alone or together with all other title defects, would not reasonably be expected to result in a Material Adverse Change.
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6.9 Financial Statements.
(a) Historical Statements. The Borrower has delivered to the Administrative Agent copies of audited combined year-end financial statements as of December 31, 2023 and December 31, 2022 and for the fiscal years then ended (the “Historical Statements”). The Historical Statements were compiled from the books and records maintained by management of the Borrower and its Subsidiaries, are correct and complete in all material respects and fairly represent the combined financial condition of the Borrower and its Subsidiaries as of their dates and their results of operations and cash flows for the fiscal periods specified and have been prepared in accordance with GAAP consistently applied.
(b) Financial Projections. The Borrower has delivered to the Administrative Agent financial projections (including balance sheets and statements of operation and cash flows) for the period 2025 through 2029 (broken out on an annual basis) derived from various assumptions of the Borrower’s management (the “Financial Projections”). The Financial Projections have been prepared in good faith based upon reasonable assumptions; it being understood that such Financial Projections are subject to significant uncertainties and contingencies, many of which are beyond the Borrower’s control, and that no assurance can be given that the Financial Projections will be realized.
(c) Accuracy of Financial Statements. Neither the Borrower nor any of its Subsidiaries has any material liabilities, contingent or otherwise, or forward or long-term commitments that are not disclosed in the Historical Statements or in the notes thereto, and except as disclosed therein there are no unrealized or anticipated losses from any commitments of the Borrower or any of its Subsidiaries that would reasonably be expected to cause a Material Adverse Change. Since December 31, 2023, no event, circumstance or condition has occurred or exists that has resulted in or could be reasonably expected, either individually or in the aggregate, to result in a Material Adverse Change.
6.10 Use of Proceeds.
The Loan Parties intend to use the proceeds of the Loans in accordance with Section 8.1.11 [Use of Proceeds; Margin Regulations].
6.11 Liens in the Collateral.
(a) Security Interests. Except to the extent that the Loan Parties are not required to perfect Liens in certain Collateral pursuant to the Security Documents or any other Loan Document, the Liens and security interests granted to the Collateral Agent for the benefit of the Secured Parties pursuant to the Security Agreement in the Collateral (of the type that can be perfected by filing under the Uniform Commercial Code), subject to the actions described in the following sentence, constitute and will continue to constitute first-priority security interests, subject to Permitted Liens, under the Uniform Commercial Code as in effect in each applicable jurisdiction or other applicable Law entitled to all the rights, benefits and priorities provided by the Uniform Commercial Code or such Law. Upon the due filing of financing statements relating to said security interests in each office and in each jurisdiction where required in order to perfect the security interests described above, the filing of the Patent, Trademark and Copyright Security Agreement with the United States Patent and Trademark Office and United States Copyright Office and taking possession of any stock certificates or other certificates evidencing the Pledged Securities, all such action as is necessary or advisable to perfect the Lien in favor of the Collateral Agent with respect to the Collateral described above will have been taken except to the extent that the Loan Parties are not required to perfect Liens in certain Collateral pursuant to the Security Documents or any other Loan Document. All filing fees and other expenses in connection with each such action have been or will be paid by the Borrower.
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(b) Mortgage Liens. Subject to the qualifications and limitations set forth expressly in the Mortgages, upon execution and delivery thereof, the Liens granted to the Collateral Agent pursuant to each Mortgage will constitute a valid first priority Lien on the Real Property under applicable law, subject only to Permitted Liens.
(c) Pledged Securities. All Equity Interests included in the Pledged Securities to be pledged pursuant to the Security Agreement are or will be upon issuance validly issued and nonassessable and owned beneficially and of record by the pledgor free and clear of any Lien or restriction on transfer, except for nonconsensual Permitted Liens, Liens contemplated by clause (11) of the definition of “Permitted Liens” and inchoate Permitted Liens that do not have priority over the Liens granted under the Loan Documents and as otherwise provided by the Security Agreement and except as the right of the Lenders to Dispose of such Equity Interests may be limited by the Securities Act and the regulations promulgated by the SEC thereunder and by applicable state securities laws. There are no shareholder or other agreements or understandings other than partnership agreements, limited liability company agreements or operating agreements, with respect to the Equity Interests included in the Pledged Securities. The Loan Parties have delivered true and correct copies of such partnership agreements and limited liability company agreements to the Collateral Agent pursuant to Section 7.1.1(b)(iii) [Secretary’s Certificate] of this Agreement as in effect on the Closing Date.
6.12 Full Disclosure.
(a) Neither this Agreement nor any other Loan Document, nor any certificate, statement, agreement or other documents furnished to any Agent or any Lender in connection herewith or therewith, contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein and therein, in light of the circumstances under which they were made, not misleading. There is no fact known to any Loan Party which materially adversely affects the business, property, assets, financial condition, or results of operations of the Loan Parties taken as a whole that has not been set forth in this Agreement or in the certificates, statements, agreements or other documents furnished in writing to the Agents and the Lenders prior to or at the date hereof in connection with the transactions contemplated hereby or prior to the Amendment No. 6 Effective Date in connection with the transactions contemplated by Amendment No. 6.
(b) As of the Amendment No. 6 Effective Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.
6.13 Taxes.
All material federal, state, local and other Tax returns required to have been filed with respect to each Loan Party have been filed, and payment or adequate provision has been made for the payment of all material Taxes, fees, assessments and other governmental charges (including in its capacity as withholding agent), except to the extent that such Taxes, fees, assessments and other charges are being contested in good faith by appropriate proceedings diligently conducted and for which such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made. There are no agreements or waivers extending the statutory period of limitations applicable to any material federal income Tax return of any Loan Party for any period.
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6.14 Consents and Approvals.
Except for the filings or recordings required pursuant to Section 7.1.1(c) [Delivery of Loan Documents] of this Agreement as in effect on the Closing Date, no consent, approval, exemption, order or authorization of, or a registration or filing with, any Official Body or any other Person is necessary to authorize or permit the execution, delivery or performance of this Agreement and the other Loan Documents or for the validity or enforceability hereof or thereof.
6.15 No Event of Default; Compliance with Instruments.
No event has occurred and is continuing and no condition exists or will exist after giving effect to the borrowings or other extensions of credit to be made on the Closing Date under or pursuant to the Loan Documents or after giving effect to the amendments to the Loan Documents on the Amendment No. 6 Effective Date which constitutes an Event of Default or Potential Default. None of the Loan Parties is in violation of (i) any term of its certificate of incorporation, bylaws, certificate of limited partnership, partnership agreement, certificate of formation, limited liability company agreement or other organizational documents, or (ii) any material agreement or instrument to which it is a party or by which it or any of its properties may be subject or bound where such violation would reasonably be expected to result in a Material Adverse Change.
6.16 Patents, Trademarks, Copyrights, Licenses, Permits, Etc.
The Borrower and the Restricted Subsidiaries own or possess all the material patents, trademarks, service marks, trade names, copyrights, licenses, registrations, franchises, Required Permits and rights, without known or actual conflict with the rights of others, necessary for the Borrower and the Restricted Subsidiaries, taken as a whole, to own and operate their properties and to carry on their businesses as presently conducted and planned to be conducted by them, except where the failure to so own or possess with or without such conflict would reasonably be expected to result in a Material Adverse Change.
6.17 Solvency.
The Borrower and its Subsidiaries, taken as a whole, are Solvent. On the Closing Date, on the Amendment No. 1 Effective Date, on the Amendment No. 6 Effective Date, at the time of each borrowing of the Loans, the issuance of the Letters of Credit (including extensions, renewals and amendments thereof) and at the time of selection of, renewal of or conversion to an Interest Rate Option, the Borrower and its Subsidiaries, taken as a whole, shall be Solvent after giving effect to the transactions contemplated by the Loan Documents and any incurrence of Indebtedness and all other Obligations.
6.18 Real Property.
(a) Schedule 3(a) to the Amendment No. 6 Perfection Certificate sets forth a complete and accurate list as of the Amendment No. 6 Effective Date of all Real Properties of any Loan Party other than Excluded Assets (other than Specified Leased Properties identified on Schedule 3(d) to the Perfection Certificate) and indicates whether any such Real Property has a Building thereon. All Real Properties of any Loan Party not set forth on Schedule 3(a) or Schedule 3(d) to the Amendment No. 6 Perfection Certificate are Excluded Assets.
(b) Schedule 3(d) to the Amendment No. 6 Perfection Certificate sets forth a complete and accurate list of all Specified Leased Properties that, with landlord consent, would be subject to Mortgage.
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6.19 Insurance.
Schedule 12 to the Amendment No. 6 Perfection Certificate lists all material insurance policies of the Borrower and the Restricted Subsidiaries as of the Amendment No. 6 Effective Date, all of which are valid and in full force and effect as of the Amendment No. 6 Effective Date. Such policies provide adequate insurance coverage from reputable and financially sound insurers in amounts sufficient to insure the assets and risks of the Borrower and the Restricted Subsidiaries in accordance with prudent business practice in the industry of the Borrower and the Restricted Subsidiaries.
6.20 Compliance with Laws.
The Borrower and its Subsidiaries are in compliance with all applicable Laws (other than Environmental Laws which are specifically addressed in Section 6.25 [Environmental Matters]) in all jurisdictions in which the Borrower or any of its Subsidiaries is presently or will be doing business, except where the failure to do so would not reasonably be expected to result in a Material Adverse Change.
6.21 Burdensome Restrictions.
None of the Loan Parties is bound by any contractual obligation, or subject to any restriction in any organization document, or any requirement of Law which would reasonably be expected to result in a Material Adverse Change.
6.22 Investment Companies; Regulated Entities.
None of the Loan Parties is an “investment company” registered or required to be registered under the Investment Company Act of 1940 or under the “control” of an “investment company” as such terms are defined in the Investment Company Act of 1940 and shall not become such an “investment company” or under such “control.” None of the Loan Parties is subject to any other Law limiting its ability to incur Indebtedness for borrowed money.
6.23 ERISA Compliance.
Except as could not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Change:
(a) each Pension Plan and Multiemployer Plan is in compliance with the applicable provisions of ERISA, the Code and other Federal or state Laws (except that with respect to any Multiemployer Plan, such representation is deemed made only to the knowledge of the Borrower);
(b) the Borrower and each ERISA Affiliate have met all applicable minimum funding requirements under the Pension Funding Rules in respect of each Pension Plan, and no waiver of the minimum funding standards under the Pension Funding Rules has been applied for or obtained;
(c) as of the most recent valuation date for any Pension Plan, the funding target attainment percentage (as defined in Section 430(d)(2) of the Code and Section 303(d)(2) of ERISA) is 80% or higher and neither the Borrower nor any ERISA Affiliate knows of any facts or circumstances which would cause the funding target attainment percentage for any such plan to drop below 80% as of the most recent valuation date;
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(d) with respect to any Multiemployer Plan to which the Borrower or its ERISA Affiliates contribute, the Borrower has not been notified of an “accumulated funding deficiency” (within the meaning of Section 412 of the Code) or that application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made;
(e) there has been no nonexempt “prohibited transaction” (as defined in Section 406 of ERISA) or violation of the fiduciary responsibility rules with respect to any Pension Plan;
(f) no ERISA Event has occurred or is reasonably expected to occur; and
(g) neither the Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.
6.24 Employment Matters; Coal Act; Black Lung Act.
Each of the Loan Parties is, and for the past five years has been, in compliance with the Labor Contracts and all applicable federal, state and local labor and employment Laws including those related to equal employment opportunity and affirmative action, labor relations, minimum wage, overtime, child labor, medical insurance continuation, worker adjustment and relocation notices, immigration controls and worker and unemployment compensation, except where the failure to comply would not reasonably be expected to constitute a Material Adverse Change. There are no outstanding grievances, arbitration awards or appeals therefrom arising out of the Labor Contracts or current or threatened strikes, picketing, handbilling or other work stoppages or slowdowns at facilities of any of the Loan Parties which in any case would constitute a Material Adverse Change. The Borrower, the Restricted Subsidiaries and its “related persons” (as defined in the Coal Act) are in compliance in all material respects with the Coal Act and none of the Borrower, the Restricted Subsidiaries or its related persons has any liability under the Coal Act except with respect to premiums or other payments required thereunder which have been paid when due and except to the extent that the liability thereunder would not reasonably be expected to result in a Material Adverse Change. The Borrower and its Subsidiaries are in compliance in all material respects with the Black Lung Act, and neither the Borrower nor any of its Subsidiaries has any liability under the Black Lung Act except with respect to premiums, contributions or other payments required thereunder which have been paid when due and except to the extent that the liability thereunder would not reasonably be expected to result in a Material Adverse Change.
6.25 Environmental Matters.
Except as could not reasonably be expected, either individually or in the aggregate, to result in a Material Adverse Change:
(a) The Borrower and its Subsidiaries, their operations, facilities and properties are and for the past five years have been in compliance with all Environmental Laws.
(b) The facilities and properties currently owned, leased or operated by the Borrower or any of its Subsidiaries or, to the knowledge of the Borrower or any of its Subsidiaries, formerly owned, leased or operated by the Borrower or any of its Subsidiaries or their predecessors in interest (the “Properties”), do not contain any Hazardous Materials in amounts or concentrations which (i) constitute or constituted a violation of Environmental Law by, or (ii) could reasonably be expected to give rise to any Environmental Liability for, the Borrower or any of its Subsidiaries.
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(c) Neither the Borrower nor any of its Subsidiaries has received any written notice of violation, alleged violation, non-compliance, liability or potential liability regarding compliance with or other liabilities under Environmental Laws or knows of any basis for any such written notices under Environmental Laws, including any with regard to their activities at any of the Properties or the business currently or formerly operated by the Borrower or any of its Subsidiaries, or any prior business for which the Borrower or any of its Subsidiaries is subject to liability under any Environmental Law.
(d) Hazardous Materials have not been transported or Released from the Properties in violation of, or in a manner or to a location which could reasonably be expected to give rise to liability for the Borrower or any of its Subsidiaries under, any applicable Environmental Law, nor have any Hazardous Materials been generated, treated, stored or Released of by or on behalf of the Borrower or any of its Subsidiaries at, on, from or under any of the Properties in violation of any Environmental Law or in a manner that could reasonably be expected to give rise to Environmental Liability for the Borrower or any of its Subsidiaries.
6.26 Anti-Terrorism Laws; Anti-Corruption Laws.
(a) (i) No Covered Entity, any directors or officers of any Covered Entity, nor, to the knowledge of the Borrower, any employees or agents of any Covered Entity, is a Sanctioned Person, and (ii) no Covered Entity, any directors or officers of any Covered Entity, nor, to the knowledge of the Borrower, any employees or agents of any Covered Entity, either in its own right or through any third party, (x) has any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law, (y) does business in or with, or derives any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law or (z) engages in any dealings or transactions prohibited by any Anti-Terrorism Law.
(b) No Covered Entity, any directors or officers of any Covered Entity, nor, to the knowledge of the Borrower, any employees or agents of any Covered Entity, are doing business in violation of any Anti-Corruption Laws.
6.27 Margin Regulations.
None of the Loan Parties is engaged, and none of the Loan Parties will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of the Margin Stock Regulation issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock.
6.28 Surety Bonds.
All surety, reclamation and similar bonds required to be maintained by the Borrower or any of its Subsidiaries under any Environmental Law or contractual obligation are in full force and effect except for any failure which individually or when taken together with all failures under such bonds would not reasonably be expected to result in a Material Adverse Change, and were not and will not be terminated, suspended, revoked or otherwise adversely affected by virtue of the consummation of the financing (including the making of all Loans and issuance of all Letters of Credit) contemplated by this Agreement; provided that certain of such bonds may be terminated, suspended or revoked so long as, taken together, such events could not reasonably be expected to result in a Material Adverse Change. All required guaranties of, and letters of credit with respect to, such surety, reclamation and similar bonds are in full force and effect except where failure to be in full force and effect could not reasonably be expected to result in a Material Adverse Change.
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6.29 Coal Supply Agreements.
As of the Amendment No. 6 Effective Date, all Coal Supply Agreements to which the Borrower or any of its Subsidiaries is subject or by which it is bound are in full force and effect, except for any failure which individually or when taken together with all failures under all Coal Supply Agreements would not reasonably be expected to result in a Material Adverse Change.
7. CONDITIONS OF LENDING AND ISSUANCE OF LETTERS OF CREDIT
The obligation of each Lender to make Loans, of an Issuing Lender to issue Letters of Credit hereunder, and of the Swingline Lender to make Swing Loans is subject to the following conditions:
7.1 [Reserved].
7.2 Each Additional Loan or Letter of Credit.
At the time of making any Loans or issuing any Letters of Credit (or amendments or extensions thereto) and after giving effect to the proposed extensions of credit:
(a) the representations and warranties of the Loan Parties contained in Section 6 [Representations and Warranties] and in the other Loan Documents shall be true and correct in all material respects on and as of the date of the making of any Loan Request, any Swing Loan Request and the making of such additional Loan or the issuance such Letter of Credit (or amendments or extensions thereto) with the same effect as though such representations and warranties had been made on and as of such date (except that (i) any representation and warranty that is already qualified as to materiality shall be true and correct in all respects as so qualified and (ii) representations and warranties which expressly relate solely to an earlier date or time, which representations and warranties shall be true and correct on and as of the specific dates or times referred to therein);
(b) no Event of Default or Potential Default shall have occurred and be continuing;
(c) the Borrower shall have delivered to the Administrative Agent a duly executed and completed Loan Request or to the applicable Issuing Lender the Issuer Documents for a Letter of Credit, as the case may be; and
(d) the aggregate amount of Excess Balance Sheet Cash will not exceed $125,000,000 if the aggregate amount of outstanding Revolving Credit Loans, Swing Loan and Letter of Credit Obligations (excluding the aggregate undrawn amount of Letters of Credit) exceeds 25.0% of the Revolving Credit Commitments.
Each request for the making of any Loans or issuance of any Letters of Credit and each issuance, amendment, renewal, increase or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in clauses (a) and (b) of this Section 7.2.
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8. COVENANTS
8.1 Affirmative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until payment in full of the Loans and Reimbursement Obligations, and interest thereon, expiration or termination of all Letters of Credit, and satisfaction of all of the Loan Parties’ other Obligations under the Loan Documents and termination of the Commitments, the Loan Parties shall comply at all times with the following affirmative covenants:
8.1.1 Preservation of Existence, Etc.
Each of the Borrower and the Restricted Subsidiaries shall maintain its legal existence as a corporation, limited partnership or limited liability company and its license or qualification and good standing in each jurisdiction in which its failure to so qualify, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Change, except as otherwise expressly permitted by Section 8.2.6 [Liquidations, Mergers, Consolidations, Acquisitions].
8.1.2 Payment of Liabilities, Including Taxes, Etc.
Each of the Borrower and the Restricted Subsidiaries shall duly pay and discharge all liabilities to which it is subject or which are asserted against it, promptly as and when the same shall become due and payable (including extensions), including all Taxes, assessments and governmental charges upon it or any of its properties, assets, income or profits, prior to the date on which penalties attach thereto, except to the extent that such liabilities, including Taxes, assessments or charges, are being contested in good faith and by appropriate and lawful proceedings diligently conducted and for which such reserve or other appropriate provisions, if any, as shall be required by GAAP shall have been made, but only to the extent that failure to pay or discharge any such liabilities would not result in any additional liability which would adversely affect to a material extent the financial condition of the Borrower and the Restricted Subsidiaries, taken as a whole, or which would materially and adversely affect the Collateral; provided that the Loan Parties will pay all such liabilities forthwith upon the commencement of proceedings to enforce any Lien which may have attached as security therefor or take other action as is required to suspend such enforcement action unless such Lien otherwise qualifies as a Permitted Lien.
8.1.3 Maintenance of Insurance.
(a) The Borrower and the Restricted Subsidiaries shall insure their properties and assets against loss or damage by fire and such other insurable hazards (including flood, fire, property damage, workers’ compensation and public liability insurance) and against other risks, and in such amounts as similar properties and assets, as are commonly insured by prudent companies in similar circumstances carrying on similar businesses, and with reputable and financially sound insurers, including self-insurance to the extent customary. At the request of the Collateral Agent, the Borrower shall deliver to the Collateral Agent (x) annually an original certificate of insurance signed by its independent insurance broker describing and certifying as to the existence of the insurance on the Collateral required to be maintained by this Agreement and the other Loan Documents, together with a copy of the endorsement described in the next sentence attached to such certificate and (y) from time to time a summary schedule indicating all commercial insurance then in force with respect to the Borrower and the Restricted Subsidiaries. Such policies of insurance shall contain the necessary endorsements or policy language, which shall (i) specify the Collateral Agent on behalf of the Secured Parties as an additional insured on the liability policies and mortgagee and lender loss payee as their interests may appear on the property policies,
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with the understanding that any obligation imposed upon the insured (including the liability to pay premiums) shall be the sole obligation of the Borrower and the Restricted Subsidiaries and not that of the additional insured, (ii) provide that the interest of the Lenders, under the lender’s loss payable endorsement in a form similar to the form provided on the Closing Date or pursuant to Section 8.1.21 [Post-Closing Matters], shall be insured regardless of any breach or violation by the Borrower or any of its Subsidiaries of any warranties, declarations or conditions contained in such policies or any action or inaction of the Borrower or any of its Subsidiaries, (iii) provide a waiver of any right of the insurers to set off or counterclaim or any other deduction, whether by attachment or otherwise (to the extent that the Loan Parties are able on a commercially reasonable efforts basis to obtain such waiver from the insurers), (iv) provide that no cancellation of such policies for any reason (including non-payment of premium) nor any change therein shall be effective until at least ten (10) days after notification to the Collateral Agent of such cancellation or change, (v) be primary without right of contribution of any other liability insurance carried by or on behalf of any additional insureds with respect to their respective interests in the Collateral, and (vi) provide that inasmuch as any liability policy covers more than one insured, all terms, conditions, insuring agreements and endorsements (except limits of liability) shall operate as if there were a separate policy covering each insured.
(b) Each Loan Party shall take all actions required under the Flood Laws and otherwise reasonably requested by the Collateral Agent to assist in ensuring that each Lender is in compliance with the Flood Laws applicable to the Collateral, including, but not limited to, (i) maintaining such flood insurance in full force and effect and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Laws and otherwise reasonably requested by the Collateral Agent, (ii) delivering to the Collateral Agent evidence of such compliance in form and substance reasonably acceptable to the Collateral Agent and (iii) delivering to the Collateral Agent an executed acknowledgment of each “Life-of-Loan” flood hazard determination delivered to the Borrower promptly following receipt of each such determination.
(c) If one or more Casualty Events occurs with respect to which the proceeds or other compensation in respect thereof could reasonably be expected to equal or exceed $10,000,000 in the aggregate in any fiscal year, the Borrower shall promptly notify the Collateral Agent of such event(s) and the estimated (or actual, if available) amount of such loss.
8.1.4 Maintenance of Properties and Equipment.
The Borrower and the Restricted Subsidiaries shall (x) maintain in good repair, working order and condition (ordinary wear and tear excepted) in accordance with the general practice of other businesses of similar character and size, all of those material properties and equipment useful or necessary to their businesses and (y) make or cause to be made, in a reasonably diligent fashion, all appropriate repairs, renewals or replacements thereof, in each case if the failure to so maintain, repair, renew or replace the same would reasonably be expected to constitute a Material Adverse Change.
8.1.5 Maintenance of Patents, Trademarks, Etc.
The Borrower and the Restricted Subsidiaries shall maintain in full force and effect all patents, trademarks, service marks, trade names, copyrights, licenses, franchises, permits and other authorizations necessary for the ownership and operation of their properties and business if the failure so to maintain the same would constitute a Material Adverse Change.
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8.1.6 Visitation Rights.
The Borrower and the Restricted Subsidiaries shall permit any of the officers or authorized employees or representatives of any Agent or any of the Lenders (so long as no Event of Default has occurred and is continuing, at the applicable Agent’s or such Lender’s expense) to visit and inspect their properties during normal business hours and to examine (including, without limitation, any field examinations) and make excerpts from their books and records and discuss their business affairs, finances and accounts with their officers, all in such detail and at such times and as often as any of the Lenders may reasonably request; provided that each Lender shall provide the Borrower and the Administrative Agent with reasonable notice prior to any visit or inspection, all such visits and inspections shall be made in accordance with the standard safety, visit, and inspection procedures of the Borrower and the Restricted Subsidiaries and no such visit or inspection shall interfere with their normal business operation. In the event any Lender desires to conduct an audit of the Borrower or any Restricted Subsidiary, such Lender shall make a reasonable effort to conduct such audit contemporaneously with any audit to be performed by the applicable Agent.
8.1.7 Keeping of Records and Books of Account.
The Borrower and the Restricted Subsidiaries shall maintain and keep proper books of record and account which enable the Borrower to issue financial statements in accordance with GAAP and as otherwise required by applicable Laws, and in which full, true and correct entries shall be made in all material respects of all their dealings and business and financial affairs. Without limiting the generality of the foregoing, the Borrower and the Restricted Subsidiaries shall maintain adequate allowances on their books in accordance with GAAP for (i) future costs associated with any lung disease claim alleging pneumoconiosis or silicosis or arising out of exposure or alleged exposure to coal dust or the coal mining environment, (ii) future costs associated with retiree and health care benefits, (iii) future costs associated with reclamation of disturbed acreage, removal of facilities and other closing costs in connection with its mining activities and (iv) future costs associated with other potential Environmental Liabilities.
8.1.8 Further Assurances.
Each Loan Party shall, from time to time, at its expense, faithfully preserve and protect the Lien on the Collateral in favor of the Collateral Agent for the benefit of the Secured Parties as a continuing first priority perfected Lien, subject only to Permitted Liens, and shall do such other acts and things as the Collateral Agent in its reasonable discretion may deem necessary or advisable from time to time in order to preserve, perfect and protect the Liens granted under the Loan Documents and to exercise and enforce the Collateral Agent’s rights and remedies thereunder with respect to the Collateral.
8.1.9 Additional Guarantors.
If (i) the Borrower forms or acquires following the Closing Date (including, for the avoidance of doubt any Arch Acquired Entity), directly or indirectly, any Subsidiary (other than an Excluded Subsidiary) or (ii) any Subsidiary that was an Excluded Subsidiary ceases to be an Excluded Subsidiary (x) within 30 days (or such later date as the Administrative Agent may agree) after the date of acquisition or formation of such Subsidiary (or within 90 days after the Amendment No. 6 Effective Date with respect to any Arch Acquired Entity (or such later date as the Administrative Agent may agree)), or within 30 days after the date (or such later date as the Administrative Agent may agree) any Subsidiary that was an Excluded Subsidiary (other than pursuant to clause (a) or (e) of the definition of “Excluded Subsidiaries”) ceases to be an Excluded Subsidiary and (y) within 15 days after the date (or such later date as the Administrative Agent may agree) any Subsidiary that was an Excluded Subsidiary pursuant to
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clause (a) or (e) of the definition of “Excluded Subsidiaries” ceases to be an Excluded Subsidiary by delivering to the Agents (A) a signed Guarantor Joinder, (B) documents in the forms described in Sections 7.1.1(b), (c), (d) (in the case of clause (i) or (ii) of this Section 8.1.9, if requested by any Agent), (f), (g), (i) and (j) [Deliveries], and 8.1.17 [Collateral], of this Agreement as in effect on the Closing Date and as modified as appropriate, and, in the case of clause (iii) of this Section 8.1.9, any other opinions of local counsel reasonably requested by the Collateral Agent and (C) documents necessary to grant and perfect Liens to the Collateral Agent for the benefit of the Secured Parties in the Collateral held by such Subsidiary or Person. The date that the Arch Acquired Entities shall have become Guarantors shall be referred to as the “Arch Accession Date.”
8.1.10 Compliance with Laws.
The Borrower and its Subsidiaries shall comply with all applicable Laws, including all Environmental Laws, in all material respects, except where the failure to so comply would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change.
8.1.11 Use of Proceeds; Margin Regulations.
(a) The proceeds of Revolving Credit Loans shall be used for general corporate purposes of the Borrower and the Restricted Subsidiaries.
(b) The Letters of Credit issued hereunder shall be used for general corporate purposes including to support surety bond obligations but not to support indebtedness for borrowed money.
(c) None of the Loan Parties engages or will engage principally, or as one of its important activities, in the business of extending credit for the purpose, immediately, incidentally or ultimately, of purchasing or carrying margin stock (within the meaning of the Margin Stock Regulation). No part of the proceeds of any Loan has been or shall be used for any purpose which entails a violation of or which is inconsistent with the provisions of the Margin Stock Regulations, and the Borrower shall execute and deliver to the Lenders appropriate completed forms (including, without limitation, Forms G-3 and U-1, as appropriate) and shall otherwise assist the Lenders, as reasonably requested by the Administrative Agent, with the Lenders’ compliance with the Margin Stock Regulation as such compliance relates to the Borrower and the Loans, including by providing the Administrative Agent with all other documents, forms and certificates reasonably requested by the Administrative Agent in relation thereto.
8.1.12 Subordination of Intercompany Loans.
Each Loan Party shall cause any Indebtedness, loans or advances owed by any Loan Party to any Restricted Subsidiary that is not a Guarantor to be subordinated pursuant to the terms of the Intercompany Subordination Agreement.
8.1.13 Anti-Terrorism Laws; Anti-Corruption Laws.
(a) No Covered Entity, nor to the knowledge of the Borrower, any directors, officers or employees of any Covered Entity, will become a Sanctioned Person, (b) no Covered Entity, either in its own right or through any third party, nor to the knowledge of the Borrower, any of a Covered Entity’s directors, officers or employees, will (i) have any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law; (ii) do business in or with, or derive any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law; (iii) engage in any dealings or transactions prohibited by any Anti-Terrorism Law or (iv) use the Loans or Letters of Credit to fund any operations in,
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finance any investments or activities in, or, make any payments to, a Sanctioned Country or Sanctioned Person or in any manner that would cause a violation of the Anti-Terrorism Laws by any party to this Agreement, (c) the funds used to repay the Obligations will not be derived from any unlawful activity, (d) each Covered Entity shall comply with all Anti-Terrorism Laws in all material respects and (e) the Borrower shall promptly notify the Administrative Agent in writing upon the occurrence of a Reportable Compliance Event.
(b) No part of the proceeds of any Loans shall 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 any Anti-Corruption Laws.
8.1.14 [Reserved].
8.1.15 Accounts.
As of the Amendment No. 6 Effective Date, no Loan Party has any Deposit Accounts, Commodities Accounts or Securities Accounts (each as defined in the UCC) other than the accounts listed on Schedule 8 to the Amendment No. 6 Perfection Certificate, which schedule indicates for each account whether such account is an Excluded Account and the reason for the exclusion, if any. No Loan Party shall establish or maintain an Applicable Account unless it is subject to a control agreement; provided, with respect to any Applicable Account maintained by a Loan Party as of the Closing Date, the Loan Parties shall cause such Applicable Account to be subject to control agreements within sixty (60) days of the Closing Date (or such later date as the Collateral Agent may agree in its discretion). Other than Applicable Accounts as to which the time limit set forth in the proviso in the immediately preceding sentence has not expired, none of the Loan Parties will deposit or maintain Collateral (including the proceeds thereof) in an Applicable Account that is not subject to a control agreement.
8.1.16 ERISA Compliance.
The Borrower shall, and shall cause each of its ERISA Affiliates to: (a) maintain each Pension Plan in compliance with the applicable provisions of ERISA and the Code and (b) make all required contributions to any Pension Plan or Multiemployer Plan when due, except in the case of each of the foregoing clauses, to the extent such failure to do so could not reasonably be expected to result in a Material Adverse Change.
8.1.17 Collateral.
(a) Pursuant to the Loan Documents, the Loan Parties shall grant, or cause to be granted, to the Collateral Agent, for the benefit of the Secured Parties, a first priority lien and security interest, subject only to Permitted Liens:
(i) on the Closing Date, in all Equity Interests owned by the Loan Parties on the Closing Date, and within 15 days after the date of acquisition thereof, all Equity Interests issued after the Closing Date by PA Mining Complex LP, PA Mining Complex GP LLC and each Receivables Subsidiary to the Borrower or any of its Subsidiaries;
(ii) in all Equity Interests acquired by a Loan Party after the Closing Date (to the extent not covered by clause (i) above), not later than 30 days after such acquisition or after any such Equity Interests cease to be an Excluded Asset (or 90 days after the Amendment No. 6 Effective Date with respect the Equity Interests of any Arch Acquired Entity) (or such later date as the Administrative Agent may agree);
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(iii) (x) in all Real Property owned or leased by a Loan Party as of the Closing Date, (y) within 60 days following the acquisition or lease thereof, or within 60 days following the joinder of a Guarantor entity that owns or leases Real Property (or such later date as the Administrative Agent may agree), in all Real Property (other than Excluded Assets) acquired or leased by a Loan Party after the Closing Date and (z) within 60 days following any Real Property ceasing to be an Excluded Asset (or such later date as the Administrative Agent may agree), in such Real Property, in each case by delivering a Mortgage or, in the case of clause (y) or (z), an amendment to an existing Mortgage, as applicable; provided that (A) each Mortgage or amendment delivered pursuant to this Section 8.1.17(a)(iii) shall be accompanied by (1) local counsel opinions with respect thereto as reasonably requested by the Collateral Agent, (2) the Required Flood Materials and (3) title work, if any, as required pursuant to Section 8.1.18 [Title], (B) with respect to Specified Leased Properties, if the applicable Loan Party is not able to, after the use of commercially reasonable efforts and delivery of an Officer’s Certificate stating that such efforts have been made, obtain the consent of the landlord to grant a first priority lien, security interest and assignment in the leasehold interest of the applicable Specified Leased Property, such Specified Leased Property shall not be Collateral, and (C) the applicable Loan Party shall not execute and deliver any Mortgage in respect of any Real Property acquired by any Loan Party after the Closing Date or in respect of Real Property that has ceased to constitute an Excluded Asset after the Closing Date until the date that occurs thirty (30) days after the Collateral Agent has made available to the Lenders a copy of the Required Flood Materials; provided that if any deadline specified in clause (y) or (z) above would pass prior to the end of the 30-day period described in this clause (C), such deadline shall be extended to the end of such 30-day period; and
(iv) on the date hereof and with respect to any Subsidiary that becomes a Loan Party after the Closing Date in accordance with Section 8.1.9 [Additional Guarantors], not later than 30 days after the acquisition or formation of such Subsidiary (or 90 days after the Amendment No. 6 Effective Date with respect to any Arch Acquired Entity) or such Subsidiary ceasing to be an Excluded Subsidiary (or in the case of Applicable Accounts, within the period provided under Section 8.1.15 [Accounts]), in all of the other assets of the Loan Parties in which a security interest may be perfected by the filing of a UCC-1 financing statement with the secretary of state or similar agency in the applicable Loan Party’s jurisdiction of organization, by filing of a short form security agreement with the United States Patent and Trademark Officer or United States Copyright Office or, in the case of Applicable Accounts, by taking the actions required under Section 8.1.15 [Accounts].
provided that any of the deadlines in this Section 8.1.17(a) may be extended (by notice to the Borrower in writing) by the Collateral Agent in its sole discretion upon reasonable request of the Borrower.
(b) Notwithstanding the foregoing, Liens will not be required on any of the following (collectively, the “Excluded Assets”):
(i) any Equity Interests in ARCH RECEIVABLE COMPANY, LLC, a Delaware limited liability company, to the extent not permitted by the terms of a Qualified Receivables Transaction;
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(ii) any right, title and interests in and to any Manufactured (Mobile) Home (as defined in the applicable Flood Laws), and all Buildings other than those specifically set forth on Schedule 8.1.17 hereto;
(iii) (1) undeveloped coal reserves owned or leased by a Loan Party as of the Closing Date that are not Specified Coal Reserves, (2) undeveloped coal reserves acquired by a Loan Party after the Closing Date the Fair Market Value of which does not exceed $30,000,000 in the aggregate or $10,000,000 individually and (3) developed coal reserves (other than Specified Coal Reserves or any portion of the Pennsylvania Mining Complex), whether owned on the Closing Date or subsequently acquired, the Fair Market Value of which does not exceed $30,000,000 in the aggregate or $10,000,000 individually;
(iv) leased motor vehicles (including bulldozers and other heavy equipment);
(v) except to the extent the security interest in such assets can be perfected by the filing of a UCC financing statement, owned motor vehicles (including bulldozers and other heavy equipment) and other assets the ownership of which is evidenced by certificates of title, to the extent the Fair Market Value thereof does not exceed $30,000,000 in the aggregate or $4,000,000 individually;
(vi) except to the extent constituting supporting obligations of other Collateral, Letter-of-Credit Rights (as defined in the UCC) that do not exceed $30,000,000 in the aggregate or $10,000,000 individually;
(vii) Commercial Tort Claims (as defined in the UCC) that do not exceed $10,000,000 in the aggregate for all Pledgors; provided that none of the Commercial Tort Claims described in Schedule 7 of the Perfection Certificate on the Closing Date shall be Excluded Assets;
(viii) assets owned by any Pledgor on the Closing Date or that are acquired after the Closing Date and any proceeds thereof that are subject to a Lien permitted by clause (10) in the definition of “Permitted Liens” to the extent and for so long as the contract or other agreement in which such Lien is granted (or the documentation providing for the Capital Lease Obligations, equipment lease, purchase money obligation or substantially similar obligation subject to such Lien) validly prohibits the creation of any other Lien on such assets and proceeds;
(ix) those assets over which the granting of security interests in such assets would be prohibited by (1) any contract in effect on the Amendment No. 6 Effective Date and listed on Schedule 8.2.15 (or, as to any assets acquired after the Amendment No. 6 Effective Date in an acquisition permitted hereunder, in effect at the time of acquisition thereof and not entered into in contemplation thereof) or (2) applicable law or regulation or to the extent that such security interests would require obtaining the consent of any governmental or regulatory authority, but only to the extent and for so long as a grant of a security interest therein in favor of the Collateral Agent would (x) violate or invalidate such contract, cause the acceleration or the termination thereof or create a right of termination in favor of any other party thereto (other than the Borrower or any of its Subsidiaries) or (y) violate such applicable law or regulation or require such consent;
(x) any intent-to-use trademark application to the extent and for so long as creation by a Pledgor of a security interest therein would result in the loss by such Pledgor of any material rights therein;
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(xi) any Equity Interests in any Person that is not a Wholly-Owned Subsidiary of the Borrower to the extent not permitted by the terms of such Person’s organizational or joint venture documents;
(xii) any Voting Stock of any CFC or CFC Holdco in excess of 65% of the total voting power of all outstanding Voting Stock of such Subsidiary, it being understood that any Equity Interests constituting “stock entitled to vote” within the meaning of Treasury Regulation Section 1.956-2(c)(2) shall be treated as Voting Stock for purposes of this clause (xii);
(xiii) assets owned by any Pledgor on the Closing Date or hereafter acquired and any proceeds thereof as to which the Borrower reasonably determines (and the Collateral Agent agrees in writing (which may be by e-mail)) that the cost of obtaining such a security interest or perfection thereof are excessive in relation to the benefit to the Secured Parties of the security to be afforded thereby;
(xiv) any lease, permit, license or other agreement permitted to be entered into under this Agreement, in each case, only to the extent and for so long as a grant of a security interest therein in favor of the Collateral Agent would violate or invalidate such lease, permit, license or agreement, cause the acceleration or the termination thereof or create a right of termination in favor of any other party thereto (other than the Borrower or any of its Subsidiaries);
(xv) Qualified Receivables Assets to the extent subject to a Qualified Receivables Transaction;
(xvi) all locomotives, rail cars and rolling stock now or hereafter leased by the Loan Parties;
(xvii) the Loan Parties’ timber to be cut other than to the extent encumbered by any Mortgage;
(xviii) Immaterial Real Property;
(xix) Specified Leased Properties excluded from the Collateral pursuant to clause (B) of the proviso to Section 8.1.17(a)(iii);
(xx) Excluded Accounts described in clauses (i), (ii) and (iii) of the definition of “Excluded Accounts”;
(xxi) Equity Interests in, and assets of, CONSOL Innovations so long as CONSOL Innovations does not hold any coal or mining assets; and
(xxii) prior to the date that is twelve (12) months after the Amendment No. 6 Effective Date, the Equity Interests in, and assets of, the Powder River Basin Entities (provided that such date shall be extended so long as a definitive agreement to sell all such Equity Interests or all such assets and shall be extended until the date such agreement has been consummated or such agreement has expired or been terminated) (such date, as may be so extended, the “Powder River End Date”); provided that, unless such Equity Interests and assets referred to in this clause (xxii) would otherwise constitute Excluded Assets, upon the Powder River Basin End Date, such Equity Interests and assets shall be required to become Collateral in accordance with Section 8.1.17(a);
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provided that (x) clauses (viii), (ix), (xi) and (xiv) shall be after giving effect to applicable provisions of the Uniform Commercial Code of any applicable jurisdiction or other applicable law, and shall not include proceeds and receivables of assets described in such clauses, the assignment of which is expressly deemed effective under the Uniform Commercial Code of any applicable jurisdiction notwithstanding the prohibition described in such clause, (y) in no event shall any Required Collateral constitute Excluded Assets, except (A) any Manufactured (Mobile) Home or Building excluded from the Collateral by operation of Section 8.1.17(b)(ii) and (B) any Specified Leased Property that is excluded from the Collateral pursuant to clause (B) of the proviso to Section 8.1.17(a)(iii) and (z) Excluded Assets shall not include any Proceeds (as defined in the UCC), substitutions or replacements of any assets referred to in any of the foregoing clauses (i) through (xviii) unless such Proceeds (as defined in the UCC), substitutions or replacements would constitute assets expressly referred to in any such clause.
(c) No actions shall be required to perfect security interests in locomotive, rail cars and rolling stock owned by the Loan Parties until the aggregate Fair Market Value of such assets exceeds $10,000,000.
(d) No actions in any non-U.S. jurisdiction or required by the laws of any non-U.S. jurisdiction shall be required to be taken (x) to create any security interests in assets located or titled outside of the U.S. or (y) to perfect or make enforceable any security interests in any assets (other than delivery of Equity Interests pursuant to Section 8.1.17(a)(i) and Section 8.1.17(a)(ii)) (it being understood that no security agreements or pledge agreements governed under the laws of any non-U.S. jurisdiction shall be required).
(e) No Loan Party shall effect any change (i) in any Loan Party’s legal name, (ii) in the location of any Loan Party’s chief executive office, (iii) in any Loan Party’s identity or organizational structure, (iv) in any Loan Party’s Federal Taxpayer Identification Number or organizational identification number, if any, or (v) in any Loan Party’s jurisdiction of organization (in each case, including by merging with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction), until (A) it shall have given the Collateral Agent written notice within 30 days after such change, clearly describing such change and providing such other information in connection therewith as the Collateral Agent may reasonably request and (B) within 30 days after such change, it shall have taken all action reasonably satisfactory to the Collateral Agent to maintain the perfection and priority of the security interest of the Collateral Agent for the benefit of the Secured Parties in the Collateral, if applicable. Each Loan Party agrees to promptly provide the Collateral Agent with certified organizational documents reflecting any of the changes described in the preceding sentence.
8.1.18 Title.
The Loan Parties shall comply with the requirements set forth on Schedule 8.1.18.
8.1.19 Maintenance of Permits.
The Borrower and the Restricted Subsidiaries shall maintain all Required Permits in full force and effect in accordance with their terms except where the failure to do so would not reasonably be expected to result in a Material Adverse Change.
8.1.20 Preparation of Environmental Reports.
If an Event of Default caused by reason of a breach under Section 8.1.10 [Compliance with Laws] with respect to compliance with Environmental Laws shall have occurred and be continuing, at the reasonable request of the Required Lenders through the Administrative Agent, provide, in the case
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of the Borrower, to the Lenders within 60 days after such request, at the expense of the Borrower, an environmental or mining site assessment or audit report for the properties, which are the subject of such breach prepared by an environmental or mining consulting firm reasonably acceptable to each Agent and indicating the presence or absence of Hazardous Materials and the estimated cost of any compliance or corrective action in connection with such properties and the estimated cost of curing any violation of or non-compliance with any Environmental Law.
8.1.21 Post-Closing Matters.
The Loan Parties will execute and deliver to the applicable Agent the documents and complete the tasks set forth on Schedule 8.1.21, within the time frames set forth therein, unless otherwise waived or extended by the applicable Agent in its sole discretion.
8.2 Negative Covenants.
The Loan Parties, jointly and severally, covenant and agree that until payment in full of the Loans and Reimbursement Obligations and interest thereon, expiration or termination of all Letters of Credit, satisfaction of all of the Loan Parties’ other Obligations hereunder and termination of the Commitments, the Loan Parties shall comply with the following negative covenants:
8.2.1 Indebtedness.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, directly or indirectly, incur, assume or otherwise become liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness, and the Borrower will not issue any Disqualified Stock and will not permit any Restricted Subsidiary to issue any Preferred Stock, except:
(a) Indebtedness under the Loan Documents;
(b) (A) Indebtedness existing on the Amendment No. 6 Effective Date (other than the Permitted Arch Rollover Indebtedness) and (B) the Permitted Arch Rollover Indebtedness, in each case set forth on Schedule 8.2.1, and in each case Refinancing Indebtedness of such Indebtedness;
(c) Indebtedness owed by (i) a Loan Party to another Loan Party, (ii) a Restricted Subsidiary that is not a Loan Party to another Restricted Subsidiary that is not a Loan Party, (iii) a Restricted Subsidiary to a Loan Party and (iv) any Loan Party to a Restricted Subsidiary that is not a Loan Party; provided that (x) any Indebtedness pursuant to clause (iii) is permitted by Section 8.2.4(h), (l) or (r) [Loans and Investments] and (y) any Indebtedness pursuant to clause (iv) is subordinated to the extent required by, and in accordance with, Section 8.1.12 [Subordination of Intercompany Loans];
(d) Indebtedness represented by mortgage financings, purchase money obligations or other Indebtedness, in each case incurred for the purpose of financing all or any part of the price or cost of design, construction, installation, development, repair or improvement of plant, property or equipment used in the business of the Borrower or any Restricted Subsidiary, and Capital Lease Obligations, and Refinancing Indebtedness of any of the foregoing, in an aggregate amount, when taken together with the outstanding amount of all other Indebtedness or Refinancing Indebtedness incurred pursuant to this clause (d), not to exceed at any time outstanding under this clause (d), the greater of (i) $250,000,000 and (ii) 5.0% of CTA at such time;
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(e) Indebtedness of any Person that becomes a Restricted Subsidiary after the Closing Date as permitted by this Agreement, which Indebtedness is existing at the time such Person becomes a Restricted Subsidiary (and was not incurred in connection with or in contemplation of such Person’s becoming a Subsidiary of the Borrower) in an aggregate amount not to exceed $100,000,000 at any time outstanding;
(f) Indebtedness under Swap Agreements permitted under Section 8.2.12 [Swaps];
(g) Indebtedness in respect of self-insurance obligations or bid, plugging and abandonment, appeal, reimbursement, performance, reclamation, employment, surety and similar obligations and completion guarantees provided by or for the account of the Borrower or any Restricted Subsidiary in the ordinary course of business, and any Guaranties and letters of credit functioning as or supporting any of the foregoing in the ordinary course of business;
(h) (A) the CONSOL BMT Bonds (and any guaranty thereof provided by the Borrower), (B) the CONSOL CRDA Bonds (and any guaranty thereof provided by the Borrower), (C) the Arch Tax Exempt Bonds (and any guaranty thereof provided by the Borrower); provided that (x) prior to the Arch Accession Date, no Arch Acquired Entity shall be an obligor under any Indebtedness referred to in this clause (h) other than the Arch Tax Exempt Bonds and (y) on and after the Arch Accession Date, only Persons that are Loan Parties may be obligors on the CONSOL BMT Bonds, the CONSOL CRDA Bonds and Arch Tax Exempt Bonds, and (D) in each case of clauses (A), (B) or (C) any Refinancing Indebtedness in respect thereof; provided that no Indebtedness under this clause (h) shall have any financial maintenance covenant;
(i) (x) Permitted Pari Passu Indebtedness, (y) [reserved] and (z) other Indebtedness of the Borrower (and Guaranties of such Indebtedness by the Guarantors); provided that in the case of Indebtedness under this subclause (z), (1) the aggregate principal amount outstanding shall not exceed the greater of (i) $150,000,000 and (ii) 3.0% of CTA at such time, (2) no payment of principal in respect of such Indebtedness shall be required prior to six months after the Latest Maturity Date in effect at the time of issuance (except for customary offers to purchase with proceeds of asset sales or upon the occurrence of a change of control), (3) the Indebtedness shall not include any financial maintenance covenants, (4) in the case of notes, the covenants and events of default shall be customary for high yield debt securities and (5) in the case of loans, the covenants and events of default shall be customary for second lien loans but in any event shall be less restrictive than the covenants and events of default hereunder (with cushions to the negative covenants and events of default that are customary for Indebtedness of such type and which cushions are reasonably satisfactory to the Administrative Agent); provided, further, that notwithstanding clauses (2) and (5), Indebtedness in respect of revenue bonds or tax-exempt municipal bonds issued by any Official Body may contain (A) in the case of revenue bonds, mandatory redemption or similar requirements upon certain tax or invalidity events and, in the case of tax-exempt municipal bonds, redemption or offer to purchase or interim amortization requirements solely related to customary sinking funds and customary tax or other customary invalidity events, (B) covenants (but not financial maintenance covenants) and (C) events of default and remedies, in each case, customary for Indebtedness of such type, as certified in good faith, after consultation with bond counsel, in an Officer’s Certificate delivered to the Administrative Agent prior to the incurrence of such Indebtedness;
(j) Indebtedness incurred in a Qualified Receivables Transaction in an aggregate amount not to exceed $350,000,000 at any time outstanding;
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(k) liability in respect of the Indebtedness of any Unrestricted Subsidiary or any Joint Venture in an aggregate amount not to exceed $20,000,000 at any time outstanding; provided that, in the case of Indebtedness of an Unrestricted Subsidiary, (i) such liability shall arise only as a result of the pledge of (or a Guaranty limited in recourse solely to) Equity Interests in such Unrestricted Subsidiary held by the Borrower or a Restricted Subsidiary to secure such Indebtedness and (ii) such Indebtedness shall be Non-Recourse Debt;
(l) Indebtedness of the Borrower or any Restricted Subsidiary or the issuance of any Disqualified Stock by the Borrower or Preferred Stock by any Restricted Subsidiary in an aggregate amount not exceeding, at any one time outstanding, $50,000,000; and
(m) (x) Permitted Unsecured Notes and (y) Refinancing Indebtedness thereof; provided that the Borrower is in compliance, on a Pro Forma Basis, with the Financial Covenants immediately after giving effect to such Indebtedness;
provided that in the case of clause (j), (l) or (m), at the time of and after giving effect to the incurrence of any such Indebtedness no Potential Default or Event of Default shall exist.
In the event that an item of Indebtedness meets the criteria of more than one of the categories of Indebtedness described in the clauses of the preceding paragraph, the Borrower shall, in its sole discretion, divide, classify or reclassify (or later divide, classify, redivide or reclassify) such item of Indebtedness in any manner that complies with this covenant (including splitting into multiple exceptions) and will only be required to include the amount and type of such Indebtedness in one of such clauses of the preceding paragraph.
The accrual of interest or Preferred Stock or Disqualified Stock dividends or distributions, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of Preferred Stock or Disqualified Stock as Indebtedness due to a change in accounting principles, and the payment of dividends or distributions on Preferred Stock or Disqualified Stock in the form of additional securities of the same class of Preferred Stock or Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Preferred Stock or Disqualified Stock for purposes of this covenant; provided that the amount thereof shall be included in the calculation of Consolidated Interest Expense of the Borrower as accrued to the extent required by the definition of such term.
8.2.2 Liens.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, at any time, directly or indirectly, create, incur, assume or suffer to exist any Lien on any property or assets of the Borrower or any Restricted Subsidiary, tangible or intangible, now owned or hereafter acquired, or agree or become liable to do so, except Permitted Liens.
8.2.3 Designation of Unrestricted Subsidiaries.
(a) Except as otherwise provided in the definition of “Unrestricted Subsidiary,” the Board of Directors of the Borrower may at any time designate any Restricted Subsidiary as an Unrestricted Subsidiary (including any newly acquired or newly formed Restricted Subsidiary at or prior to the time it is so acquired or formed but excluding any Restricted Subsidiary that was previously an Unrestricted Subsidiary), or any Unrestricted Subsidiary as a Restricted Subsidiary; provided that (i) immediately before and after such designation, no Potential Default or Event of Default shall have occurred and
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be continuing, (ii) immediately after giving effect to such designation, the Borrower shall be in compliance, on a Pro Forma Basis, with the Financial Covenants, (iii) no Subsidiary may be designated as an Unrestricted Subsidiary if it is a “Restricted Subsidiary” for the purpose of any Indebtedness incurred pursuant to Section 8.2.1(i) or (m) [Indebtedness] (unless it is substantially concurrently being designated as an Unrestricted Subsidiary under such Indebtedness) and (iv) no Arch Acquired Entity shall be designated as an Unrestricted Subsidiary prior to the Arch Accession Date (unless otherwise agreed to in writing by the Administrative Agent). Any (x) designation of a Subsidiary as an Unrestricted Subsidiary or (y) redesignation as a Restricted Subsidiary will be evidenced to the Administrative Agent by delivering to the Administrative Agent a copy of a Board Resolution giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the requirements of this Section 8.2.3. The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower or the relevant Restricted Subsidiary (as applicable) therein at the date of designation in an amount equal to the Fair Market Value of the Borrower’s or such relevant Restricted Subsidiary’s (as applicable) investment therein, as determined in good faith by such Borrower or such relevant Restricted Subsidiary, and the Investment resulting from such designation must otherwise be permitted under Section 8.2.4 [Loans and Investments]. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such time.
(b) No Unrestricted Subsidiary shall:
(1) have any Indebtedness other than Non-Recourse Debt;
(2) except as permitted by Section 8.2.8 [Affiliate Transactions], be party to any agreement, contract, arrangement or understanding with the Borrower or any Restricted Subsidiary unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Borrower or such Restricted Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Borrower;
(3) be a Person with respect to which either the Borrower or any Restricted Subsidiary has any direct or indirect obligation (x) to subscribe for additional Equity Interests (except pursuant to an Investment that would be permitted hereunder at the time such obligation is incurred and such Investment is made) or (y) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results;
(4) Guaranty or otherwise directly or indirectly provide credit support for any Indebtedness of the Borrower or any Restricted Subsidiary, except to the extent such Guaranty would be and is released upon such designation as an Unrestricted Subsidiary; or
(5) hold any interest in any Required Collateral.
8.2.4 Loans and Investments.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, at any time, directly or indirectly, make or suffer to remain outstanding any Investment or become or remain liable for any Investments, except:
(a) (i) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business and (ii) loans or advances to officers, directors or employees made in the ordinary course of business; provided that such loans and advances to all such officers, directors and employees do not exceed an aggregate amount of $5,000,000 outstanding at any time;
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(b) Temporary Cash Investments;
(c) any transaction permitted under Section 8.2.6 [Liquidations, Mergers, Consolidations, Acquisitions] (including any Permitted Acquisition);
(d) such Investments consisting of prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar deposits made in the ordinary course of business by the Borrower or any Restricted Subsidiary;
(e) (x) any Investment existing on, or made pursuant to binding commitments existing on, the Amendment No. 6 Effective Date and described on Schedule 8.2.4(x), and (y) any Investment of GasCo or any of its Subsidiaries existing on the Amendment No. 6 Effective Date and described on Schedule 8.2.4(y) that relates to the coal business and is assumed by the Borrower or any Restricted Subsidiary after the Amendment No. 6 Effective Date and, in each case, any Investment consisting of an extension, modification or renewal of any such Investment described in the foregoing clause (x) or (y); provided that any increase in the amount of any such Investment will be permitted only to the extent such increase is otherwise permitted under this Section 8.2.4 [Loans and Investments];
(f) Investments (i) in any Loan Party or (ii) by any Restricted Subsidiary that is not a Loan Party in any other Restricted Subsidiary that is not a Loan Party;
(g) any Investments received in compromise or resolution of (i) obligations of trade creditors or customers that were incurred in the ordinary course of business of the Borrower or any Restricted Subsidiary, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer or (ii) litigation, arbitration or other disputes;
(h) other Investments that do not in the aggregate exceed at any one time outstanding the greater of (i) $150,000,000 and (ii) 3.0% of CTA at such time; provided that (x) the Total Net Leverage Ratio at such time, calculated on a Pro Forma Basis, shall not be greater than 1.50:1.00 and (y) after giving effect thereto, Total Liquidity shall be at least $300,000,000; provided, further that no more than an aggregate of $150,000,000 of all such Investments made pursuant to this clause (h) together with Investments made pursuant to clause (l) below may be made in a form other than cash or Temporary Cash Investments (with all such Investments valued at the Fair Market Value at the time of such Investment); provided that the Borrower shall deliver to the Administrative Agent prior to the making of any Investment pursuant to this clause (h) an Officer’s Certificate certifying compliance with the requirements of this clause (h) and setting forth calculations in reasonable detail showing such compliance;
(i) other Investments that do not in the aggregate exceed at any one time outstanding the greater of (i) $100,000,000 and (ii) 2.0% of CTA at such time;
(j) [reserved];
(k) [reserved];
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(l) other Investments; provided that (x) the Total Net Leverage Ratio at such time, calculated on a Pro Forma Basis, shall not be greater than 1.00:1.00 and (y) after giving effect thereto, Total Liquidity shall be at least $300,000,000; provided, further that no more than an aggregate of $150,000,000 of all such Investments made pursuant to this clause (l) together with Investments made pursuant to clause (h) above (when taken together) may be made other than in the form or cash or Temporary Cash Investments (with all such Investments valued at the Fair Market Value at the time of such Investment); provided that the Borrower shall deliver to the Administrative Agent prior to the making of any Investment pursuant to this clause (l) an Officer’s Certificate certifying compliance with the requirements of this clause (l) and setting forth calculations in reasonable detail showing such compliance;
(m) an Investment in receivables owing to the Borrower or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms, including such concessionary trade terms as the Borrower or any such Restricted Subsidiary deems reasonable under the circumstances;
(n) Swap Agreements permitted under Section 8.2.12 [Swaps];
(o) Investments in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connection with a Qualified Receivables Transaction permitted under Section 8.2.1(j) [Indebtedness], including Investments of funds held in accounts permitted or required by the arrangements governing such Qualified Receivables Transaction or any related Indebtedness;
(p) endorsements of negotiable instruments and documents in the ordinary course of business;
(q) guarantees by the Borrower or a Restricted Subsidiary of performance of obligations incurred in the ordinary course of business (other than for payment of Indebtedness or letter of credit reimbursement obligations); provided guarantees pursuant to this clause (q) of such obligations of Persons that are not Loan Parties shall not exceed $10,000,000 in the aggregate at any time;
(r) so long as no Potential Default or Event of Default shall have occurred and be continuing or shall result therefrom, Investments in and by any water treatment trust, energy transition fund or captive insurance company not to exceed (without duplication) $50,000,000 in the aggregate; and
(s) any Investment made as a result of the receipt of Designated Non-Cash Consideration in an aggregate amount not to exceed the Threshold Amount at any one time outstanding.
Notwithstanding anything to the contrary herein, no assets shall be Disposed to any Arch Acquired Entity by Borrower or any Subsidiary of Borrower on or following the Amendment No. 6 Effective Date and prior to the Arch Accession Date, except by any Subsidiary of Borrower that is another Arch Acquired Entity that shall have also been acquired by Borrower pursuant to the Arch Merger and that itself has not been the recipient of assets Disposed of by Borrower or any Subsidiary of Borrower on or following the Amendment No. 6 Effective Date and prior to the Arch Accession Date.
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8.2.5 Restricted Payments.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, directly or indirectly, make a Restricted Payment, except:
(a) [reserved];
(b) payments of cash, dividends, distributions, advances or other Restricted Payments by the Borrower or any Restricted Subsidiary to allow the payment of cash in lieu of the issuance of fractional shares upon (i) the exercise of options or warrants or (ii) the conversion or exchange of Equity Interests of any such Person;
(c) the repurchase, redemption or other acquisition or retirement for value of Equity Interests of the Borrower or any of the Restricted Subsidiaries held by any current or former officer, director or employee of the Borrower or any of the Restricted Subsidiaries (to the extent granted to such Person in respect of performance of services for the Borrower or any of the Restricted Subsidiaries) (or their respective estates, heirs, family members, spouses, former spouses or beneficiaries under their estates or other permitted transferees), pursuant to the terms of any equity subscription agreement, stock option agreement, shareholders’ agreement, compensation agreement or arrangement or similar agreement; provided that the aggregate amount of such acquisitions or retirements (excluding amounts representing cancellation of Indebtedness) shall not exceed $4,000,000 in any calendar year (with any portion of such $4,000,000 amount that is unused in any calendar year to be carried forward to successive calendar years, in each case, added to such amount, provided that the amount so carried forward shall not exceed $12,000,000 at any time (it being agreed and acknowledged that as of the Amendment No. 6 Effective Date, the available amount of the carry-forward is $6,000,000)); provided further that such amount in any calendar year may be increased by an amount not to exceed the cash proceeds of key man life insurance policies received by the Borrower after the Closing Date;
(d) the Borrower and each of the Restricted Subsidiaries may purchase, redeem or otherwise acquire its Equity Interests or make other Restricted Payments with the net cash proceeds received by the Borrower from the substantially concurrent issuance and sale of common stock of the Borrower;
(e) the repurchase of Equity Interests deemed to occur upon the exercise of stock or other equity options to the extent such Equity Interests represent a portion of the exercise price of those stock or other equity options and any repurchase or other acquisition of Equity Interests made in lieu of withholding taxes in connection with any exercise or exchange of stock options, warrants, incentives or other rights to acquire Equity Interests;
(f) prepayment of any Specified Junior Obligations with Refinancing Indebtedness thereof;
(g) repurchases of Specified Junior Obligations of the Borrower or any Restricted Subsidiary at a purchase price not greater than 100% of the principal amount of such Specified Junior Obligations in the event of an asset disposition, in each case plus accrued and unpaid interest thereon, to the extent required by the terms of such Specified Junior Obligations;
(h) so long as no Potential Default or Event of Default shall have occurred and be continuing or shall result therefrom, purchases, repurchases or redemptions of any Specified Junior Obligations in an aggregate amount not to exceed $50,000,000 per calendar year (with any portion of such $50,000,000 amount that is unused in any calendar year to be carried forward to successive calendar years and added to such amount, provided that the aggregate amount of such purchases, repurchases or redemptions made in any calendar year shall not exceed $100,000,000);
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(i) so long as no Potential Default or Event of Default shall have occurred and be continuing or shall result therefrom, additional Restricted Payments so long as (i) after giving effect thereto Total Liquidity shall be at least $300,000,000 and (ii) as calculated on a Pro Forma Basis, the Total Net Leverage Ratio at such time shall not be greater than (x) in the case of Restricted Payments within the meaning of clause (1) or (2) of the definition of “Restricted Payment”, 1.00:1.00 and (y) in the case of Restricted Payments within the meaning of clause (3) of the definition of “Restricted Payment”, 1.50:1.00; provided that the Borrower shall deliver to the Administrative Agent prior to the making of any Restricted Payment pursuant to this Section 8.2.5(i) [Restricted Payments] an Officer’s Certificate certifying compliance with the requirements of this Section 8.2.5(i) [Restricted Payments] and setting forth calculations in reasonable detail showing such compliance; and
(j) Restricted Payments within the meaning of clause (1) or (2) of the definition of “Restricted Payment” in an aggregate amount (measured at the time of each such Restricted Payment) not to exceed $100,000,000 per calendar year (with any portion of such $100,000,000 amount that is unused in any calendar year to be carried forward to successive calendar years and added to such amount; provided that the aggregate amount of such Restricted Payments made in any calendar year should not exceed $150,000,000).
8.2.6 Liquidations, Mergers, Consolidations, Acquisitions.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, dissolve, liquidate or wind-up its affairs, or become a party to any merger or consolidation, effect a division or make any acquisition described in subclause (y) or (z) of clause (b) below (including by acquisition of the Equity Interests of another Person); provided that:
(a) (i) any Restricted Subsidiary may consolidate or merge into any other Restricted Subsidiary or acquire Equity Interests in any Restricted Subsidiary; provided that in the case of a consolidation or merger involving a Loan Party, a Loan Party is the surviving entity, (ii) any Restricted Subsidiary may consolidate or merge into the Borrower; provided that the Borrower is the surviving entity and (iii) any Restricted Subsidiary may effect a division; provided that (x) in the event of any division involving a Loan Party, (1) the dividing Loan Party (if surviving) and any other Person resulting from such division shall be a Loan Party after giving effect to such division and (2) any assets or other property held by any Loan Party immediately prior to such division shall continue to be held by a Loan Party after giving effect to such division and (y) in the event of any division involving a Restricted Subsidiary that is not a Loan Party, (1) such dividing Restricted Subsidiary (if surviving) and any other Person resulting from such division shall be a Restricted Subsidiary after giving effect to such division and (2) any assets or other property held by any Restricted Subsidiary immediately prior to such division shall continue to be held by a Restricted Subsidiary after giving effect to such division;
(b) the Borrower or any Restricted Subsidiary may acquire whether by purchase or by merger or consolidation, (x) Equity Interests of another Person, (y) substantially all of the assets of another Person or the assets constituting a business or division of another Person or (z) the material assets of another Person (each, a “Permitted Acquisition”); provided that each of the following requirements is met:
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(i) no Potential Default or Event of Default shall exist immediately prior to and after giving effect to such Permitted Acquisition;
(ii) after giving effect to such Permitted Acquisition, (x) Total Liquidity shall be at least $300,000,000 and (y) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Covenants;
(iii) to the extent that the acquisition includes the acquisition of Equity Interests in any Person that is not a Loan Party or that does not become a Loan Party in connection with such acquisition, or of assets by any Restricted Subsidiary that is not a Loan Party, such acquisition shall be subject to Section 8.2.4 [Loans and Investments] (without giving effect to clause (c) thereof) and the aggregate Consideration attributable to such Equity Interests or assets shall count against availability under Section 8.2.4 [Loans and Investments] (other than clause (c) thereof);
(iv) if the Consideration to be paid by the Restricted Subsidiaries for such Permitted Acquisition exceeds the Threshold Amount, the Restricted Subsidiaries shall deliver to the Administrative Agent before or contemporaneously with such Permitted Acquisition: (1) a certificate of the Borrower in substantially the form of Exhibit 8.2.6 evidencing (x) compliance, on a Pro Forma Basis, with the Financial Covenants and (y) compliance with the applicable requirements of clauses (b)(i), (ii) and (iii) of this Section 8.2.6 and (2) to the extent reasonably requested by the Administrative Agent and not subject to confidentiality obligations owed to any Person, copies of any agreements entered into or proposed to be entered into by the Borrower or any Restricted Subsidiary in connection with such Permitted Acquisition and such other information about such Person or its assets, and the Administrative Agent may, to the extent they receive any such copies of agreements or information, provide such copies of agreements or information to the Lenders; and
(v) the Borrower shall be the surviving entity to any merger or consolidation to which it is a party;
(c) Dispositions permitted by Section 8.2.7 [Dispositions] and any liquidation, merger, consolidation or acquisition to effect such Disposition; provided that in the case of a consolidation or merger, the requirements of Section 8.2.6(a) are complied with, to the extent applicable;
(d) any Restricted Subsidiary that holds only de minimis assets and is not conducting any material business may dissolve;
(e) any liquidation, merger, consolidation or acquisition of any Restricted Subsidiary with or into another Restricted Subsidiary effected in accordance with an agreement described on Schedule 8.2.8 shall be permitted;
(f) the Borrower may consummate the Arch Merger; provided that (i) the Arch Merger shall have been consummated on the Amendment No. 6 Effective Date in all material respects in accordance with the terms of the Arch Merger Agreement and without waiver of any condition precedent thereto to the extent such waiver could be reasonably expected to materially and adversely affect the interests of the Lenders and (ii) substantially concurrently with the Arch Merger, Arch shall have become a wholly-owned Subsidiary of the Borrower; and
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(g) the Borrower or any Restricted Subsidiary may acquire up to $100,000,000 in the aggregate of Arch Tax Exempt Bonds; provided that (i) the collateral securing such Arch Tax Exempt Bonds is released promptly, but in any event within 30 days, after acquisition by the Borrower or such Restricted Subsidiary; (ii) such Arch Tax Exempt Bonds shall not be transferred to an Unrestricted Subsidiary, (iii) the terms of such Arch Tax Exempt Bonds are not changed in a manner adverse to the Lenders and (iv) such Arch Tax Exempt Bonds become Collateral.
8.2.7 Dispositions.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, make any Disposition, except:
(a) any Disposition between or among the Borrower and the Restricted Subsidiaries; provided that in the case of a consolidation or merger, the requirements of Section 8.2.6(a) [Liquidations, Mergers, Consolidations, Acquisitions] are complied with, to the extent applicable;
(b) any Disposition that constitutes a Restricted Payment permitted by Section 8.2.5 [Restricted Payments] or an Investment permitted by Section 8.2.4 [Loans and Investments];
(c) an issuance or sale of Equity Interests by a Restricted Subsidiary to the Borrower or to a Restricted Subsidiary;
(d) the sale of extracted Coal, other mineral products or other inventory in the ordinary course of business;
(e) a sale, contribution, conveyance or other disposition of Receivables and related assets of the type specified in the definition of “Qualified Receivables Transaction” in a Qualified Receivables Transaction permitted by Section 8.2.1(j) [Indebtedness];
(f) any Disposition of surplus, damaged, worn-out or obsolete assets in the ordinary course of business (including the abandonment or other disposition of intellectual property, including seismic data and interpretations thereof, that is, in the reasonable judgment of the Borrower, no longer economically practicable to maintain or useful in the conduct of the business of the Borrower and the Restricted Subsidiaries taken as whole);
(g) licenses and sublicenses by the Borrower or any Restricted Subsidiary of software or intellectual property, including seismic data and interpretations thereof, in the ordinary course of business;
(h) any surrender or waiver of contract rights or settlement, release, recovery on or surrender of contract, tort or other claims in the ordinary course of business;
(i) the granting of Permitted Liens and dispositions in connection with Permitted Liens;
(j) the sale or other disposition of cash or Temporary Cash Investments or other financial instruments;
(k) the early termination or unwinding of any Swap Agreement;
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(l) any Disposition; provided that the Fair Market Value of all assets Disposed of under this clause (l) in any given fiscal year (other than transfers of property subject to a Casualty Event) shall not exceed the greater of (i) $150,000,000 and (ii) 3.0% of CTA at such time;
(m) leases or subleases of subsurface interests in Real Property that are not part of the Pennsylvania Mining Complex and are in the reasonable judgment of the Borrower not economically practical for the Borrower or any of its Subsidiaries to mine or operate;
(n) any Disposition made in accordance with an agreement described on Schedule 8.2.8;
(o) to the extent such a Disposition would not require a consent pursuant to Section 11.1.1(d), any Disposition that is not permitted by the other clauses of this Section 8.2.7 [Dispositions], which is approved by the Required Lenders; and
(p) any sale or disposition of the Equity Interests of any Powder River Basin Entity or CONSOL Innovations and any of their respective assets;
provided that (i) in the case of clauses (e) and (l), no Potential Default or Event of Default is then in existence or will result therefrom and (ii) in the cause of clause (p), (A) no Event of Default is then in existence or would result therefrom and (B) the Borrower shall be in compliance on a Pro Forma Basis with the Financial Covenants after giving effect to any such sale or disposition.
8.2.8 Affiliate Transactions.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, enter into or permit to exist any transaction or series of transactions (including the purchase, sale, lease or exchange of any property, employee compensation arrangements or the rendering of any service) with, or for the benefit of, any Affiliate of the Borrower (an “Affiliate Transaction”) unless the terms thereof, taken as a whole, are not materially less favorable to the Borrower or such Restricted Subsidiary than those that could reasonably be obtained at the time of such transaction in arm’s-length dealings with a Person who is not such an Affiliate or, if in the good faith judgment of the Board of Directors of the Borrower, no comparable transaction is available with which to compare such Affiliate Transaction, such Affiliate Transaction is otherwise fair to the Borrower or the relevant Restricted Subsidiary from a financial point of view.
The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of foregoing paragraph:
(a) any employment agreement, employee benefit plan, officer or director indemnification agreement or any similar arrangement entered into by the Borrower or any Restricted Subsidiary in the ordinary course of business and payments pursuant thereto;
(b) any sale of Hydrocarbons or other mineral products to an Affiliate of the Borrower or the entering into or performance of Hydrocarbon Swap Agreements, contracts for exploring for, producing, gathering, marketing, processing, storing or otherwise handling Hydrocarbons, or activities or services reasonably related or ancillary thereto, or other operational contracts entered into in the ordinary course of business which are fair to the Borrower and the Restricted Subsidiaries taken as a whole, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated party, as determined in good faith by the Borrower;
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(c) the sale or issuance to an Affiliate of the Borrower of Capital Stock of the Borrower that does not constitute Disqualified Stock, and the sale to an Affiliate of the Borrower of Indebtedness (including Disqualified Stock) of the Borrower in connection with an offering of such Indebtedness in a market transaction and on terms substantially identical to those of other purchasers in such market transaction;
(d) transactions between the Borrower or any Restricted Subsidiary with a Person that is an Affiliate of the Borrower (other than an Unrestricted Subsidiary of the Borrower) solely because of the ownership by the Borrower or any Restricted Subsidiary of Equity Interests in such Person (including the transaction pursuant to which the Borrower or any Restricted Subsidiary acquired such Equity Interests);
(e) transactions between the Borrower or any Restricted Subsidiary and any Person, a director of which is also a director of the Borrower and such director is the sole cause for such Person to be deemed an Affiliate of the Borrower or such Restricted Subsidiary; provided that such director shall abstain from voting as a director of the Borrower on any matter involving such other Person;
(f) the payment of reasonable fees to and reimbursements of expenses (including travel and entertainment expenses and similar expenditures in the ordinary course of business) of employees, officers, directors or consultants of the Borrower or any of its Subsidiaries;
(g) transactions between or among the Borrower and the Restricted Subsidiaries;
(h) payments that are permitted under Section 8.2.5 [Restricted Payments];
(i) sales, contributions, conveyances and other transfers of Receivables and related assets of the type specified in the definition of “Qualified Receivables Transaction” to a Receivables Subsidiary or any other similar transactions in connection with any Indebtedness permitted by Section 8.2.1(j) [Indebtedness];
(j) transactions effected, and payments made, in accordance with the terms of any agreement to which the Borrower or any Restricted Subsidiary is a party as of the Amendment No. 6 Effective Date and described on Schedule 8.2.8;
(k) any transaction in which the Borrower or any Restricted Subsidiary, as the case may be, delivers to the Administrative Agent a letter from an accounting, appraisal or investment banking firm of national standing (or otherwise reasonably acceptable to the Administrative Agent) stating that such transaction is fair to the Borrower or such Restricted Subsidiary from a financial point of view or that such transaction meets the requirements of the preceding paragraph;
(l) loans or advances to employees, officers or directors in the ordinary course of business and approved by the Borrower’s Board of Directors in an aggregate principal amount not to exceed $5,000,000 outstanding at any one time;
(m) any Investment in the Arch Tax Exempt Bonds permitted by Section 8.2.6; provided that the purchase of any Arch Tax Exempt Bonds by the Borrower or any of its Restricted Subsidiaries shall be at a price no greater than the redemption price in effect at such time under the Arch Tax Exempt Bonds Indenture; and
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(n) pledges by the Borrower or any Restricted Subsidiary of (or any Guaranty by the Borrower or any Restricted Subsidiary limited in recourse solely to) Equity Interests in Unrestricted Subsidiaries for the benefit of lenders or other creditors of the Borrower’s Unrestricted Subsidiaries.
8.2.9 Change in Business.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, engage in any business other than a Permitted Business.
8.2.10 Fiscal Year.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, change its fiscal year from the twelve-month period beginning January 1 and ending December 31.
8.2.11 Amendments to Certain Documents.
(a) The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, amend its certificate of incorporation (including any provisions or resolutions relating to Capital Stock), by-laws, certificate of limited partnership, partnership agreement, certificate of formation, limited liability company agreement or other organizational documents in a manner that would be adverse in any material respect to the Lenders. The Borrower shall not, through merger or otherwise, reincorporate under the laws of a jurisdiction other than a State of the United States or the District of Columbia.
(b) The Borrower shall not, and shall not cause or permit any Subsidiary to, amend or modify or grant any waiver or release under any agreement governing or evidencing any Specified Junior Obligation, in each case in any manner that would be adverse in any material respect to the Lenders.
8.2.12 Swaps.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, enter into any Swap Agreement, other than those entered into to hedge or mitigate risks to which the Borrower or any Restricted Subsidiary is exposed in the conduct of its business or the management of its liabilities, in each case, for non-speculative purposes.
8.2.13 Financial Covenants.
The Borrower shall comply with the following covenants:
(a) Maximum First Lien Gross Leverage Ratio. Commencing with the fiscal quarter ending June 30, 2022, the Borrower shall not permit the First Lien Gross Leverage Ratio, calculated as of the last day of each fiscal quarter of the Borrower, to be greater than 1.50:1.00.
(b) Maximum Total Net Leverage Ratio. Commencing with the fiscal quarter ending June 30, 2022, the Borrower shall not permit the Total Net Leverage Ratio, calculated as of the last day of each fiscal quarter of the Borrower, to be greater than 2.50:1.00.
(c) Minimum Interest Coverage Ratio. Commencing with the fiscal quarter ending June 30, 2022, the Borrower shall not permit the Interest Coverage Ratio, calculated as of the last day of each fiscal quarter of the Borrower, to be less than 3.00:1.00.
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8.2.14 Restrictions on Distributions from Restricted Subsidiaries.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, create or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its Capital Stock or pay any Indebtedness owed to the Borrower or any Restricted Subsidiary (provided that (x) the priority that any series of Preferred Stock of a Restricted Subsidiary has in receiving dividends or liquidating distributions shall not be deemed to be a restriction on the ability to pay dividends or make other distributions on its Capital Stock for purposes of this covenant and (y) the subordination of Indebtedness owed to the Borrower or any Restricted Subsidiary to other Indebtedness incurred by any Restricted Subsidiary shall not be deemed a restriction on the ability to pay Indebtedness);
(2) make any loans or advances to the Borrower or a Restricted Subsidiary (it being understood that the subordination of loans or advances made to the Borrower or any Restricted Subsidiary to other Indebtedness incurred by the Borrower or any Restricted Subsidiary shall not be deemed a restriction on the ability to make loans or advances); or
(3) sell, lease or transfer any of its property or assets to the Borrower or a Restricted Subsidiary.
The foregoing restrictions of this Section 8.2.14 [Restrictions on Distributions from Restricted Subsidiaries] will not apply to encumbrances or restrictions existing under or by reason of:
(a) any encumbrance or restriction in any agreement in effect on the Closing Date and set forth on Schedule 8.2.14;
(b) any encumbrance or restriction with respect to a Restricted Subsidiary pursuant to an agreement relating to any Indebtedness incurred by such Restricted Subsidiary on or prior to the date on which such Restricted Subsidiary was acquired by the Borrower or became a Restricted Subsidiary (other than Indebtedness incurred as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired by the Borrower) and outstanding on such date;
(c) any encumbrance or restriction pursuant to an agreement effecting a Refinancing of Indebtedness incurred pursuant to an agreement referred to in clause (a) or (b) of this paragraph or this clause (c) or contained in any amendment to an agreement referred to in clause (a) or (b) of this paragraph or this clause (c); provided that the encumbrances and restrictions with respect to such Restricted Subsidiary contained in any such refinancing agreement or amendment are no less favorable to the Lenders than encumbrances and restrictions with respect to such Restricted Subsidiary contained in such agreements, as determined in good faith by the Borrower;
(d) (i) customary non-assignment provisions in any contract, license, lease or sale or exchange agreement and (ii) cash, other deposits, or net worth or similar requirements, in each case, imposed by suppliers, customers or lessors under contracts or leases, in the case of each of clauses (i) and (ii), entered into in the ordinary course of business;
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(e) in the case of clause (3) of the preceding paragraph, restrictions contained in Capital Lease Obligations, purchase money obligations, security agreements or mortgages securing Indebtedness of a Restricted Subsidiary to the extent such restrictions restrict the transfer of the property subject to such Capital Lease Obligations, purchase money obligations, security agreements or mortgages;
(f) any restriction with respect to a Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Capital Stock or assets of such Restricted Subsidiary pending the closing of such sale or disposition;
(g) any encumbrance or restriction in any agreement or instrument in connection with a Qualified Receivables Transaction customary for transactions of such type applicable to the Qualified Receivables Assets or the applicable Receivables Subsidiary;
(h) Liens otherwise permitted to be incurred under the provisions of Section 8.2.2 [Liens] that limit the right of the debtor to Dispose of the assets subject to such Liens;
(i) provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, sale-leaseback agreements, stock sale agreements and other similar agreements (including, without limitation, agreements entered into in connection with an Investment) entered into with the approval of the Borrower’s Board of Directors, which limitation is applicable only to the assets that are the subject of such agreements;
(j) encumbrances or restrictions applicable only to a Foreign Subsidiary;
(k) Swap Agreements permitted under Section 8.2.12 [Swaps];
(l) any encumbrance or restriction with respect to an Unrestricted Subsidiary pursuant to or by reason of an agreement that the Unrestricted Subsidiary is a party to or entered into before the date on which such Unrestricted Subsidiary became a Restricted Subsidiary; provided that such agreement was not entered into in anticipation of the Unrestricted Subsidiary becoming a Restricted Subsidiary and any such encumbrance or restriction does not extend to any assets or property of the Borrower or any other Restricted Subsidiary other than the assets and property of such Unrestricted Subsidiary; and
(m) any encumbrances or restrictions imposed by any amendments of the contracts, instruments or obligations referred to in clauses (a) through (l) of this paragraph; provided that such amendments are not materially more restrictive with respect to such encumbrances and restrictions than those prior to such amendment or refinancing, as determined in good faith by the Borrower.
8.2.15 Negative Pledge Agreements.
The Borrower shall not, and shall not cause or permit any Restricted Subsidiary to, enter into or permit to exist any Contractual Requirement (other than this Agreement or any other Loan Document) that limits the ability of the Borrower or any Restricted Subsidiary to create, incur, assume or suffer to exist Liens on property of such Person (other than property specifically excluded from the Collateral requirements pursuant to Section 8.1.17(b) [Collateral]) for the benefit of the Secured Parties with respect to the Obligations or under the Loan Documents; provided that the foregoing shall not apply to each of the following Contractual Requirements that:
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(a) (i) exist on the Amendment No. 6 Effective Date and (to the extent not otherwise permitted by this Section 8.2.15) are listed on Schedule 8.2.15 and (ii) to the extent Contractual Requirements permitted by subclause (i) are set forth in an agreement evidencing Indebtedness or other obligations, are set forth in any agreement evidencing any Refinancing Indebtedness of such Indebtedness or obligation so long as such Refinancing Indebtedness does not expand the scope of such Contractual Requirement;
(b) are binding on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a Restricted Subsidiary, so long as such Contractual Requirements were not entered into solely in contemplation of such Person becoming a Restricted Subsidiary;
(c) arise pursuant to agreements entered into with respect to any Disposition permitted by Section 8.2.7 [Dispositions] and applicable solely to assets under such Disposition;
(d) are customary provisions in joint venture agreements and other similar agreements permitted by Section 8.2.4 [Loans and Investments] and applicable to the joint ventures owned by the Borrower or any Restricted Subsidiary;
(e) are negative pledges and restrictions on Liens in favor of any holder of Indebtedness permitted under Section 8.2.1 [Indebtedness], but solely to the extent any negative pledge relates to the property financed by or the subject of such Indebtedness;
(f) are customary restrictions on leases, subleases, licenses or asset sale agreements otherwise permitted hereby so long as such restrictions relate to the assets subject thereto;
(g) [reserved];
(h) are customary provisions restricting subletting or assignment of any lease governing a leasehold interest of the Borrower or any Restricted Subsidiary;
(i) are customary provisions restricting assignment of any agreement entered into in the ordinary course of business;
(j) restrict the use of cash or other deposits imposed by customers under contracts entered into in the ordinary course of business;
(k) are imposed by requirements of Law;
(l) customary net worth provisions contained in real property leases entered into by any Restricted Subsidiary, so long as the Borrower has determined in good faith that such net worth provisions would not reasonably be expected to impair the ability of the Borrower and the Restricted Subsidiaries to meet their ongoing obligation;
(m) are customary restrictions and conditions contained in the document relating to any Lien, so long as (i) such Lien is a Permitted Lien that does not secure Indebtedness for borrowed money and such restrictions or conditions relate only to the specific asset subject to such Lien and (ii) such restrictions and conditions are not created for the purpose of avoiding the restrictions imposed by this Section 8.2.15;
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(n) are restrictions imposed by any agreement relating to Indebtedness incurred pursuant to Section 8.2.1 [Indebtedness] or Refinancing Indebtedness in respect thereof, to the extent such restrictions are not materially more restrictive, taken as a whole, than the restrictions contained in the Loan Documents as determined by the Borrower in good faith and do not restrict Liens on the Collateral to secure the Obligations;
(o) are restrictions regarding licenses or sublicenses by the Borrower and the Restricted Subsidiaries of intellectual property in the ordinary course of business (in which case such restriction shall relate only to such intellectual property);
(p) are encumbrances or restrictions contained in an agreement or other instrument of a Person acquired by or merged or consolidated with or into the Borrower or any Restricted Subsidiary, or of an Unrestricted Subsidiary that is designated a Restricted Subsidiary, or that is assumed in connection with the acquisition of assets from such Person, in each case that is in existence at the time of such transaction (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person and its Subsidiaries, or the property or assets of the Person and its Subsidiaries, so acquired or designated; and
(q) are encumbrances or restrictions imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (a) through (p) above; provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Borrower’s Board of Directors, no more restrictive in any material respect with respect to such encumbrance and other restrictions taken as a whole than those prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.
8.2.16 [Reserved].
8.2.17 [Reserved].
8.2.18 Anti-Hoarding.
If any Revolving Credit Loans or Swing Loans are outstanding and (x) the aggregate amount of Excess Balance Sheet Cash exceeds $125,000,000 and (y) the aggregate amount of outstanding Revolving Credit Loans, Swing Loan and Letter of Credit Obligations (excluding the aggregate undrawn amount of Letters of credit) exceeds 25.0% of the Revolving Credit Commitments, in each case as of the last day of any calendar month, then not later than the following Business Day, the Borrower shall prepay Revolving Credit Loans and/or Swing Loans in an aggregate amount equal to the lesser of (i) the outstanding amount of the Revolving Credit Loans and Swing Loans at such time and (ii) the aggregate amount of Excess Balance Sheet Cash in excess of $125,000,000 at the end of such calendar month.
8.3 Reporting Requirements.
The Loan Parties, jointly and severally, covenant and agree that until payment in full of the Loans and Reimbursement Obligations and interest thereon, expiration or termination of all Letters of Credit, satisfaction of all of the Loan Parties’ other Obligations hereunder and under the other Loan Documents and termination of the Commitments, the Loan Parties will furnish or cause to be furnished to the Administrative Agent and each of the Lenders:
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8.3.1 Quarterly Financial Statements.
Commencing with the fiscal quarter ending September 30, 2017, as soon as available and in any event within 45 calendar days after the end of each of the first three fiscal quarters in each fiscal year (or by December 15, 2017, in the case of the fiscal quarter ending September 30, 2017), (i) financial statements of the Borrower, consisting of a consolidated balance sheet as of the end of such fiscal quarter and related consolidated statements of operations, shareholders’ equity and cash flows for the fiscal quarter then ended and the fiscal year through that date, all in reasonable detail and certified (subject to normal year-end audit adjustments) by the Chief Financial Officer or Treasurer of the Borrower as having been prepared in accordance with GAAP, consistently applied, and setting forth in comparative form the respective financial statements for the corresponding date and period in the previous fiscal year and (ii) a management’s discussion and analysis of financial condition and results of operations for each period for which financial statements are delivered pursuant to clause (i) above.
8.3.2 Annual Financial Statements.
As soon as available and in any event within 90 days after the end of each fiscal year of the Borrower, (i) financial statements of the Borrower consisting of a consolidated balance sheet as of the end of such fiscal year, and related consolidated statements of operations, shareholders’ equity and cash flows for the fiscal year then ended, all in reasonable detail and setting forth in comparative form the respective financial statements for the corresponding date and period in the previous fiscal year, and certified by independent certified public accountants of nationally recognized standing reasonably satisfactory to the Administrative Agent and (ii) a management’s discussion and analysis of financial condition and results of operations for each fiscal year for which financial statements are delivered pursuant to clause (i) above. The certificate or report of accountants shall be free of qualifications (other than any consistency qualification that may result from a change in the method used to prepare the financial statements as to which such accountants concur) or explanation statement as to “going concern” or similar matter or the scope of such audit, in each case, other than any “going concern” qualification or explanation resulting solely from a maturity scheduled to occur within twelve months of such audit of any Class of Loans or Commitments hereunder, the CONSOL BMT Bonds, the CONSOL CRDA Bonds, the Arch Tax Exempt Bonds, any Refinancing of the foregoing or a Qualified Receivables Transaction.
8.3.3 SEC Website.
Reports or other information required to be delivered pursuant to Section 8.3.1 [Quarterly Financial Statements], Section 8.3.2 [Annual Financial Statements] and Sections 8.3.7(b) and (c) [Budgets, Forecasts, Other Reports and Information] shall be deemed to have been delivered on the date on which such report or other information is posted on the SEC’s website at www.sec.gov, and such posting shall be deemed to satisfy the reporting and delivery requirements of Sections 8.3.1 [Quarterly Financial Statements], 8.3.2 [Annual Financial Statements] and 8.3.7(b) and (c) [Budgets, Forecasts, Other Reports and Information].
8.3.4 Certificate of the Borrower.
On the date that the financial statements of the Borrower furnished to the Administrative Agent and to the Lenders pursuant to Section 8.3.1 [Quarterly Financial Statements] and Section 8.3.2 [Annual Financial Statements] are required to be furnished, a certificate (each a “Compliance Certificate”) of the Borrower signed by the Chief Financial Officer or Treasurer of the Borrower, in the form of Exhibit 8.3.4, to the effect that, except as described pursuant to Section 8.3.5 [Notice of Default], (i) no Event of Default or Potential Default exists and is continuing on the date of such certificate, (ii) containing calculations in reasonable detail to demonstrate compliance as of the date of such financial statements
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with the Financial Covenants, (iii) [reserved], (iv) in the case of a Compliance Certificate delivered with respect to any fiscal year, identifying each Immaterial Subsidiary and setting forth the assets and Consolidated Net Income attributable to each Immaterial Subsidiary and (v) describing the commodity Swap Agreements in place to which any Loan Party is a party and confirming that all such Swap Agreements are Swap Agreements that the Loan Parties are permitted to enter under Section 8.2.12 [Swaps].
8.3.5 Notice of Default.
Promptly after any Responsible Officer of the Borrower has learned of the occurrence of an Event of Default or Potential Default, a certificate signed by an Authorized Officer of the Borrower setting forth the details of such Event of Default or Potential Default and the action that the Borrower proposes to take with respect thereto.
8.3.6 Certain Events.
Written notice to the Administrative Agent, for provision to the Lenders:
(a) promptly after any Responsible Officer of the Borrower has learned of the commencement thereof, notice of all actions, suits, proceedings or investigations before or by any Official Body or any other Person against the Borrower or any of its Subsidiaries (that would reasonably be expected to result in a liability against such Person) (i) relating to the Collateral involving a claim or series of claims in excess of the Threshold Amount or (ii) which if adversely determined would constitute a Material Adverse Change;
(b) promptly after any Responsible Officer of the Borrower has knowledge thereof, any event which could reasonably be expected to result in a Material Adverse Change;
(c) promptly after any Responsible Officer of the Borrower has knowledge thereof, any event of default under any Indebtedness incurred or outstanding pursuant to Section 8.2.1(h), (i), (j) or (m) [Indebtedness];
(d) promptly after any Loan Party incurs obligations or liabilities that are due and payable arising in connection with or as a result of the early or premature termination of Swap Agreements (whether or not occurring as a result of a default thereunder), which would exceed the Threshold Amount in the aggregate;
(e) within five (5) Business Days after any Responsible Officer of the Borrower has knowledge thereof, of the occurrence of any ERISA Event that would reasonably be expected to constitute a Material Adverse Change; and
(f) any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in parts (c) or (d) of such certification.
8.3.7 Budgets, Forecasts, Other Reports and Information.
Delivery to the Administrative Agent, for provision to the Lenders:
(a) Concurrently with or prior to the delivery of financial statements pursuant to Section 8.3.2 [Annual Financial Statements] for any fiscal year, the budget for the succeeding fiscal year;
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(b) Any reports, notices or proxy statements generally distributed by the Borrower to its stockholders on a date no later than the date supplied to such stockholders;
(c) Regular or periodic reports, including Forms 10-K, 10-Q and 8-K, registration statements and prospectuses, filed by the Borrower or any of its Subsidiaries with the SEC;
(d) Simultaneously with each delivery of financial statements referred to in Sections 8.3.1 [Quarterly Financial Statements] and 8.3.2 [Annual Financial Statements], the related consolidating financial statements reflecting the adjustments necessary to eliminate the accounts of Unrestricted Subsidiaries (if any) from such consolidated financial statements;
(e) Simultaneously with each delivery of financial statements referred to in Section 8.3.2 [Annual Financial Statements], a certificate of an Authorized Officer of the Borrower setting forth the information required pursuant to the Perfection Certificate Supplement or confirming that there has been no change in such information since the date of the Perfection Certificate or latest Perfection Certificate Supplement;
(f) [reserved];
(g) Promptly upon their becoming available to the Borrower, a copy of any order in any proceeding to which the Borrower or any of its Subsidiaries is a party issued by any Official Body to the extent it could reasonably be expected to result in a Material Adverse Change; and
(h) Promptly upon request, such other reports and information as any of the Lenders may from time to time reasonably request, including (i) five year projections of the Borrower and (ii) information and documentation for purposes of compliance with the applicable “know your customer” requirements under the USA PATRIOT Act or other applicable anti-money laundering laws.
8.3.8 Lender Calls.
On a Business Day within 20 days following each date financial statements of the Borrower are required to be delivered pursuant to Section 8.3.1 [Quarterly Financial Statements] or 8.3.2 [Annual Financial Statements], the Borrower shall conduct a conference call during normal business hours (which may be a public earnings call for the shareholders of the Borrower that is open to the Lenders) with the Lenders to discuss the results and the financial condition of Borrower and the Restricted Subsidiaries for such fiscal period. At least three Business Days prior to any such call, Borrower shall provide the Administrative Agent written notice of the time and date of such call, as well as all relevant information such as the telephone dial-in number and any materials to be discussed on such call.
9. DEFAULT
9.1 Events of Default.
An Event of Default shall mean the occurrence or existence of any one or more of the following events or conditions (whatever the reason therefor and whether voluntary, involuntary or effected by operation of Law):
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9.1.1 Payments Under Loan Documents.
(a) The Borrower shall fail to make (i) any payment of principal on any Loan when due or (ii) payment of any Reimbursement Obligation within one (1) Business Day after such amount becomes due;
(b) The Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation within three (3) Business Days after such interest becomes due in accordance with the terms hereof; or
(c) The Borrower shall fail to pay any other amount owing hereunder (specifically excluding amounts that are addressed in subparagraphs (a) and (b) above) or under the other Loan Documents within three (3) Business Days after the time period specified herein or therein and, if no time period is specified, then within ten (10) Business Days after a demand or notice has been provided to the Borrower requesting payment of such amount;
9.1.2 Breach of Warranty.
Any representation or warranty (x) made at any time by any of the Loan Parties herein or by any of the Loan Parties in any other Loan Document, or in any certificate, other instrument or statement furnished pursuant to the provisions hereof or thereof or (y) in the certificate delivered pursuant to Section 7.1.1(h)(ii) [Deliveries] of this Agreement as in effect on the Closing Date, shall prove to have been false or incorrect in any material respect as of the time it was made or furnished;
9.1.3 Breach of Certain Covenants.
(a) Any of the Loan Parties shall default in the observance or performance of any covenant contained in Section 8.1.1 [Preservation of Existence, Etc.] (with respect to the legal existence of the Borrower only), Section 8.1.6 [Visitation Rights], Section 8.1.11 [Use of Proceeds; Margin Regulations], Section 8.1.13 [Anti-Terrorism Laws; Anti-Corruption Laws], Section 8.2 [Negative Covenants] (other than Section 8.2.13 [Financial Covenants]) or Section 8.3.5 [Notice of Default];
(b) Any of the Loan Parties shall default in the observance or performance of any covenant contained in Section 8.2.13 [Financial Covenants];
9.1.4 Breach of Other Covenants.
Any of the Loan Parties shall default in the observance or performance of any covenant, condition or provision hereof or of any other Loan Document that is not covered by any other subsection of this Section 9.1 and such default shall continue unremedied for a period of 30 days after any Responsible Officer of any Loan Party becomes aware of the occurrence thereof;
9.1.5 Defaults in Other Agreements or Indebtedness.
A breach, default or event of default shall occur at any time under the terms of any agreement (other than any Loan Document) involving borrowed money or the extension of credit or any other Indebtedness under which the Borrower or any Restricted Subsidiary for all such Indebtedness may be obligated as a borrower or guarantor in excess of $65,000,000 in the aggregate for such Indebtedness and such breach, default or event of default consists of the failure to pay (beyond any period of grace permitted with respect thereto) any Indebtedness when due (whether at stated maturity, by acceleration or otherwise) or such breach or default permits or causes the acceleration of any Indebtedness or the termination of any commitment to lend, in excess of $65,000,000 in the aggregate for all such Indebtedness and commitments;
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9.1.6 Final Judgments or Orders.
Any final judgments, awards or orders not covered by insurance for the payment of money in excess of $85,000,000 in the aggregate shall be entered against the Borrower or any Restricted Subsidiary by a court having jurisdiction in the premises, which judgment is not discharged, vacated, bonded or stayed pending appeal within a period of sixty (60) days from the date of entry;
9.1.7 Loan Document Unenforceable.
(a) Any of the Loan Documents to which any Loan Party is a party (i) shall cease to be a legal, valid and binding agreement enforceable against such Person executing the same or such Person’s successors and assigns (as permitted under the Loan Documents) in accordance with the respective terms thereof or shall cease to be in full force and effect (in either case except by operation of its terms), or (ii) shall be contested or challenged by any Loan Party or any agent thereof or (iii) cease to give or provide the respective Liens, security interests, rights, titles, interests, remedies, powers or privileges intended to be created thereby on assets with an aggregate value (for all assets as to which an event described in this clause (iii) or the clause (b) below has occurred and is continuing) in excess of the Threshold Amount (except by operation of its terms) or (b) any security interest and Lien purported to be created by any Security Document on assets with an aggregate value (for all assets as to which an event described in this clause (b) or the clause (a)(iii) above has occurred and is continuing) in excess of the Threshold Amount shall cease to be in full force and effect, or shall cease to give the Collateral Agent, for the benefit of the Secured Parties, the Liens, rights, powers and privileges purported to be created and granted under such Security Document (except as otherwise expressly provided in such Security Document);
9.1.8 Inability to Pay Debts.
(i) The Borrower or any Restricted Subsidiary becomes unable or admits in writing its inability or fails generally to pay its debts as they become due or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any substantial part of the property of any such Person with an aggregate value (for all property described in this clause (ii)) in excess of the Threshold Amount and is not released, vacated, stayed, dismissed or fully bonded within 60 days after its issue or levy;
9.1.9 ERISA.
The occurrence of any of the following events that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change: (i) an ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan;
9.1.10 Change of Control.
A Change of Control shall occur;
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9.1.11 [Reserved].
9.1.12 Involuntary Proceedings.
A proceeding shall have been instituted in a court having jurisdiction in the premises seeking a decree or order for relief in respect of the Borrower or any Restricted Subsidiary in an involuntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect, or for the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator (or similar official) of the Borrower or any Restricted Subsidiary for any substantial part of its property, or for the winding-up or liquidation of its affairs, and such proceeding shall remain undismissed or unstayed and in effect for a period of sixty (60) consecutive days or such court shall enter a decree or order granting any of the relief sought in such proceeding;
9.1.13 Voluntary Proceedings.
The Borrower or any Restricted Subsidiary shall commence a voluntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator (or other similar official) of itself or for any substantial part of its property, or shall make a general assignment for the benefit of creditors, or shall fail generally to pay its debts as they become due, or shall take any action in furtherance of any of the foregoing;
9.2 Consequences of Event of Default.
9.2.1 Events of Default Other Than Bankruptcy, Insolvency or Reorganization Proceedings.
(a) If an Event of Default (other than under Section 9.1.12 [Involuntary Proceedings] or 9.1.13 [Voluntary Proceedings] or, unless the actions described in clause (i) or (ii) of clause (b) below have occurred, an Event of Default under Section 9.1.3(b) [Breach of Certain Covenants]) shall occur and be continuing, the Administrative Agent may, and upon the request of the Required Lenders, shall, (i) terminate all obligations on the part of the Lenders to make Loans or any Issuing Lender to issue Letters of Credit, as the case may be, (ii) by written notice to the Borrower, declare the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Obligations (other than Obligations under Specified Swap Agreements and Other Lender Provided Financial Service Products) to be forthwith due and payable, and the same shall thereupon become and be immediately due and payable to the Administrative Agent for the benefit of the Persons entitled thereto without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, and (iii) require the Borrower to, and the Borrower shall thereupon, Cash Collateralize all Letter of Credit Obligations comprised of the aggregate undrawn amount of Letters of Credit (to the extent not otherwise Cash Collateralized by the Borrower pursuant to this Agreement).
(b) If an Event of Default under Section 9.1.3(b) [Breach of Certain Covenants] shall occur and be continuing, the Administrative Agent may, and upon the request of the Required Lenders, shall, (i) terminate all obligations on the part of the applicable Lenders to make Revolving Credit Loans, Swing Loans or Term Loans or any Issuing Lender to issue Letters of Credit, as the case may be, (ii) by written notice to the Borrower, declare the unpaid principal amount of the Revolving Credit Loans, Swing Loans and Term Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Obligations relating to the Revolving Credit Loans, Swing Loans, Letters of Credit and Term Loans to be forthwith due and payable, and the same shall thereupon become and be immediately due and payable to
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the Administrative Agent for the benefit of the Persons entitled thereto without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, and (iii) require the Borrower to, and the Borrower shall thereupon, Cash Collateralize all Letter of Credit Obligations comprised of the aggregate undrawn amount of Letters of Credit (to the extent not otherwise Cash Collateralized by the Borrower pursuant to this Agreement).
9.2.2 Bankruptcy, Insolvency or Reorganization Proceedings.
If an Event of Default specified under Section 9.1.12 [Involuntary Proceedings] or Section 9.1.13 [Voluntary Proceedings] shall occur, no further obligation shall exist on the Lenders to make any Loans or any Issuing Lender to issue any Letters of Credit hereunder, and the unpaid principal amount of the Loans then outstanding and all interest accrued thereon, any unpaid fees and all other Obligations (other than Obligations under Specified Swap Agreements and Other Lender Provided Financial Service Products) shall be immediately due and payable, and the Borrower shall immediately Cash Collateralize all Letter of Credit Obligations comprised of the aggregate undrawn amount of Letters of Credit (to the extent not otherwise Cash Collateralized by the Borrower pursuant to this Agreement), in each case, without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived.
9.2.3 Set-off.
If an Event of Default shall occur and be continuing, any Secured Party to whom any Obligation is owed by any Loan Party hereunder or under any other Loan Document or any participant of any Lender which has agreed in writing to be bound by the provisions of Section 5.3 [Sharing of Payments by Lenders] and any branch, Subsidiary or Affiliate of such Secured Party anywhere in the world shall have the right (to the extent permitted by applicable Law), in addition to all other rights and remedies available to it, without notice to such Loan Party, to set-off against and apply to the then unpaid balance of all the Loans and all other Obligations of the Borrower and the other Loan Parties hereunder or under any other Loan Document any debt owing to, and any other funds held in any manner for the account of, the Borrower or such other Loan Party by such Secured Party or participant or by such branch, Subsidiary or Affiliate, including all funds in all deposit accounts (whether time or demand, general or special, provisionally credited or finally credited, or otherwise) now or hereafter maintained by the Borrower or such other Loan Party for its own account (but not including funds held in custodian or trust accounts or funds not otherwise beneficially owned by the Borrower or such other Loan Party) with such Secured Party or participant or such branch, Subsidiary or Affiliate; provided, that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.15 [Defaulting Lenders] and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) such Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. Such right shall exist whether or not any Secured Party shall have made any demand under this Agreement or any other Loan Document, whether or not such debt owing to or funds held for the account of the Borrower or such other Loan Party is or are matured or unmatured and regardless of the existence or adequacy of any Collateral, Guaranty or any other security, right or remedy available to any Secured Party.
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9.2.4 [Reserved].
9.2.5 Application of Proceeds.
From and after the date on which the Administrative Agent has taken any action pursuant to this Section 9.2 [Consequences of Event of Default] and until all Obligations of the Loan Parties have been Paid in Full, any and all proceeds received by any Agent from any sale or other disposition of the Collateral, or any part thereof, or the exercise of any other remedy by any Agent, shall be applied as follows:
(a) First, to payment of that portion of the Obligations constituting fees, indemnities, out-of-pocket expenses and other amounts (including reasonable fees, charges and disbursements of counsel to the Administrative Agent and the Collateral Agent) payable to the Administrative Agent or the Collateral Agent in their respective capacities as such;
(b) Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest. Letter of Credit Fees) payable to the Lenders and the Issuing Lenders (including fees, charges and disbursements of counsel to the respective Lenders and the Issuing Lenders) arising under the Loan Documents, ratably among them in proportion to the respective amounts described in this clause (b) payable to them;
(c) Third, to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit Fees and interest on the Loans, Reimbursement Obligations and other Obligations arising under the Loan Documents, ratably among the Lenders and the Issuing Lenders in proportion to the respective amounts described in this clause (c) payable to them;
(d) Fourth, to the Administrative Agent for the account of the Issuing Lenders, to Cash Collateralize that portion of Letter of Credit Obligations comprised of the aggregate undrawn amount of Letters of Credit to the extent not otherwise Cash Collateralized by the Borrower pursuant to this Agreement;
(e) Fifth, to payment of that portion of the Obligations constituting unpaid principal of the Loans, Reimbursement Obligations and Obligations then owing under Specified Swap Agreements and Other Lender Provided Financial Service Products, ratably among the Lenders, the Issuing Lenders and the providers of Specified Swap Agreements and Other Lender Provided Financial Service Products in proportion to the respective amounts described in this clause (e) held by them;
(f) Sixth, [reserved]; and
(g) Last, the balance, if any, after all of the Obligations have been indefeasibly Paid in Full, to the Borrower or as otherwise required by Law.
Notwithstanding the foregoing, (a) amounts received from the Borrower or any Guarantor that is not a Qualified ECP Loan Party shall not be applied to the Obligations that are Excluded Swap Obligations (it being understood, that in the event that any amount is applied to Obligations other than Excluded Swap Obligations as a result of this clause (a), the Administrative Agent shall make such adjustments as they determine are appropriate to distributions pursuant to clause Fifth above from amounts received from a Qualified ECP Loan Party to ensure, as nearly as possible, that the proportional aggregate recoveries with respect to Obligations described in clause Fifth above by the holders of any Excluded Swap Obligations are the same as the proportional aggregate recoveries with respect to other Obligations pursuant to clause
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Fifth above) and (b) Obligations arising under Specified Swap Agreements and Other Lender Provided Financial Service Products shall be excluded from the application described above if the Administrative Agent has not received written notice thereof, together with such supporting documentation as the Administrative Agent may request, from the counterparty to such Specified Swap Agreement or Other Lender Provided Financial Service Product, as the case may be. Each counterparty to a Specified Swap Agreements and Other Lender Provided Financial Service Products not a party to this Agreement that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of Section 10 [The Agents] hereof for itself and its Affiliates as if a “Lender” party hereto.
9.2.6 Collateral Agent.
All Liens granted as security for the Obligations under the Security Documents and any other Loan Document shall secure the Obligations ratably and on a pari passu basis in favor of the Collateral Agent for the benefit of the Secured Parties. No Indemnitee or provider of a Specified Swap Agreement or Other Lender Provided Financial Service Product (except in its capacity as a Lender hereunder (to the extent that this Agreement or any other Loan Document empowers the Lenders to direct the Administrative Agent)) shall be entitled or have the power to direct or instruct the Collateral Agent on any such matters or to control or direct in any manner the maintenance or disposition of the Collateral.
9.2.7 Other Rights and Remedies.
In addition to all of the rights and remedies contained in this Agreement or in any of the other Loan Documents (including each Mortgage), the Administrative Agent and the Collateral Agent shall have all of the rights and remedies of a secured party under the Uniform Commercial Code or other applicable Law, all of which rights and remedies shall be cumulative and non-exclusive to the extent permitted by Law. The Administrative Agent and the Collateral Agent may, and upon the request of the Required Lenders shall, exercise all post-default rights granted to the Administrative Agent and the Lenders under the Loan Documents or applicable Law.
9.3 Notice of Sale.
Any notice required to be given by the Collateral Agent of a sale, lease, or other disposition of the Collateral or any other intended action by the Collateral Agent, if given to the Borrower at least ten (10) days prior to such proposed action, shall constitute commercially reasonable and fair notice thereof to the Borrower.
10. THE AGENTS
10.1 Appointment and Authority.
Each Revolving Lender, Term Lender and Issuing Lender (including each in its capacity as a counterparty to a Specified Swap Agreement or Other Lender Provided Financial Service Product or an Affiliate of such counterparty on behalf of such Affiliate) hereby irrevocably designates, appoints and authorizes (subject to the Required Lenders’ removal rights set forth in Section 10.6 [Resignation of Agents]) (a) PNC to act as Administrative Agent and (b) PNC to act as Collateral Agent, in each case, for such Lender under the Loan Documents and to execute and deliver or accept on behalf of each of the Lenders the other Loan Documents. Each Lender hereby irrevocably authorizes, and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to authorize (subject to the Required Lenders’ removal rights set forth in Section 10.6 [Resignation of Agents]), the Administrative Agent and the Collateral Agent to take such action on its behalf under the provisions of this Agreement and the other
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Loan Documents and any other instruments and agreements referred to herein, and to exercise such powers and to perform such duties hereunder as are specifically delegated to or required of the Administrative Agent and the Collateral Agent or any of them by the terms hereof, together with such powers as are reasonably incidental thereto. PNC agrees to act as the Administrative Agent and PNC agrees to act as the Collateral Agent on behalf of the Lenders to the extent provided in the Loan Documents. The provisions of this Section 10 are solely for the benefit of the Agents, the Lenders and the Issuing Lender, and neither the Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions, except as set forth in Section 10.10 [Authorization to Release Collateral and Guarantors].
10.2 Rights as a Lender.
Each Person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not an Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Persons serving as an Agent hereunder in its individual capacity. Such Persons and their Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Persons were not an Agent hereunder and without any duty to account therefor to the Lenders.
10.3 Exculpatory Provisions.
The Agents shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, the Agents:
(a) shall not be subject to any fiduciary or other implied duties, regardless of whether a Potential Default or Event of Default has occurred and is continuing;
(b) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Agents are required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall such Agent in good faith believe is provided for herein or in the other Loan Documents); provided that each Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable Law;
(c) shall be entitled to seek the direction or confirmation from the Required Lenders (or other applicable group of Lenders) before taking any action under the Loan Documents;
(d) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by any Person serving as an Agent any of its Affiliates in any capacity.
No Agent shall be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as such Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 11.1 [Modifications, Amendments or Waivers] and 9.2 [Consequences of Event of Default]) or (ii) in the absence of its own gross negligence or willful misconduct. No Agent shall be deemed to have knowledge of any Potential Default or Event of Default unless and until notice describing such Potential Default or Event of Default is given to such Agent by the Borrower, a Lender or the Issuing Lender.
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No Agent shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Potential Default or Event of Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, (v) the validity, priority, perfection or continued perfection of any security interest (or purported security interest) in the Collateral or (vi) the satisfaction of any condition set forth in Section 7 [Conditions of Lending and Issuance of Letters of Credit] or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to such Agent.
10.4 Reliance by Agents.
Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender or the Issuing Lender unless the Administrative Agent shall have received notice to the contrary from such Lender or the Issuing Lender prior to the making of such Loan or the issuance of such Letter of Credit. Each Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
10.5 Delegation of Duties.
Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by such Agent. Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Section 10 shall apply to any such sub-agent and to the Related Parties of each Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Agent.
10.6 Resignation of Agents.
The Administrative Agent may at any time give notice of its resignation to the Revolving Lenders, the Term Lenders, the Issuing Lenders, the other Agents and the Borrower. The Collateral Agent may at any time give notice of its resignation to the Lenders, the Issuing Lenders, the other Agents and the Borrower. Upon receipt of any such notice of resignation, Required Class Lenders with respect to each Class represented by such Agent (or in the case of a resignation by the Collateral Agent, the Required Lenders) shall have the right, with approval from the Borrower (so long as no Event of Default has
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occurred and is continuing), to appoint a successor, such approval not to be unreasonably withheld or delayed. If no such successor to the applicable retiring Agent shall have been so appointed by the Required Class Lenders of each applicable Class (or in the case of a resignation by the Collateral Agent, the Required Lenders) and shall have accepted such appointment within thirty (30) days after the retiring Agent gives notice of its resignation, then such retiring Agent may on behalf of the applicable Lenders and, if the retiring Agent is the Administrative Agent, the Issuing Lender, appoint a successor Agent meeting the qualifications set forth above; provided that if such retiring Agent shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (i) the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that, in the case of a resignation by the Collateral Agent, in the case of any collateral security held by the Collateral Agent on behalf of the Lenders or the Administrative Agent on behalf of the Issuing Lender under any of the Loan Documents, the retiring Collateral Agent shall continue to hold such collateral security until such time as a successor Collateral Agent is appointed) and (ii) all payments, communications and determinations provided to be made by, to or through such retiring Agent shall instead be made by or to each applicable Lender and, if the retiring Agent is the Administrative Agent, the Issuing Lender directly, until such time as the Required Class Lenders of each applicable Class with respect to such retiring Agent appoint a successor Agent as provided for above in this Section 10.6. Upon the acceptance of a successor’s appointment as Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section 10.6). The fees payable by the Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Section 10.6 and Section 11.3 [Expenses; Indemnity; Damage Waiver] shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Agent was acting as Agent.
If PNC resigns as Administrative Agent under this Section 10.6, PNC shall also resign as Swingline Lender and as an Issuing Lender. If PNC resigns as an Issuing Lender, it shall retain all the rights, powers, privileges and duties of an Issuing Lender with respect to all Letters of Credit issued by it that remain outstanding as of the effective date of its resignation as Issuing Lender and all Letter of Credit Obligations with respect thereto, including the right to require the Lenders to make Participation Advances pursuant to Section 2.9.3 [Participations, Disbursements, Reimbursement]. If PNC resigns as Swingline Lender, the Borrower shall repay any outstanding Swing Loans on or prior to the effective date of such resignation and, to the extent any Swing Loans remain outstanding as of the effective date of its resignation as Swingline Lender, PNC shall retain all the rights, powers, privileges and duties of a Swingline Lender with respect to such Swing Loans, including the right to require the Lenders to make Base Rate Loans pursuant to Section 2.10 [Borrowings to Repay Swing Loans]. Upon the appointment of a successor Administrative Agent hereunder, such successor shall (i) succeed to all of the rights, powers, privileges and duties of PNC as a retiring Swingline Lender and Issuing Lender, Administrative Agent and Collateral Agent and PNC shall be discharged from all of its respective duties and obligations as Swingline Lender and Issuing Lender, Administrative Agent and Collateral Agent under the Loan Documents and (ii) issue letters of credit in substitution for the Letters of Credit issued by PNC, if any, outstanding at the time of such succession or make other arrangements satisfactory to PNC to effectively assume the obligations of PNC with respect to such Letters of Credit.
If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by applicable law, by notice in writing to the Borrower and such Person remove such Person as Administrative Agent and, in consultation with the Borrower, appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.
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10.7 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender and the Issuing Lender acknowledges that it has, independently and without reliance upon any Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and the Issuing Lender also acknowledges that it will, independently and without reliance upon any Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.
10.8 No Other Duties, Etc.
Anything herein to the contrary notwithstanding, none of the “Joint Lead Arrangers,” “Joint Bookrunners,” “Bookrunners,” or “Co-Documentation Agents” listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, the Collateral Agent, a Co-Documentation Agent, the Swingline Lender, a Lender or an Issuing Lender hereunder.
10.9 Administrative Agent’s Fee.
The Borrower shall pay to the Administrative Agent a nonrefundable fee (the “Administrative Agent’s Fee”) under the terms of a letter (each, an “Administrative Agent’s Letter”) between the Borrower and the Administrative Agent, as amended from time to time.
10.10 Authorization to Release Collateral and Guarantors.
Each Secured Party expressly agrees that, upon the written request of the Borrower (accompanied by such certificates and other documentation as the applicable Agent may reasonably request), the applicable Agent shall, so long as no Event of Default exists after giving effect thereto:
(a) in the case of the Administrative Agent, execute a release in a form reasonably satisfactory to it of any Person from the Guaranty Agreement if such Person ceases to be a Subsidiary of the Borrower or if such Person is or becomes an Excluded Subsidiary, in either case, pursuant to a transaction permitted by the Loan Documents; and
(b) in the case of the Collateral Agent, (i) execute any document in a form reasonably satisfactory to it, evidencing the release of any asset from the Lien of the Security Document upon the Disposition (other than any lease) of such asset permitted by the Loan Documents (other than a Disposition to a Loan Party) or upon such asset becoming an Excluded Asset, (ii) enter into any subordination agreement, non-disturbance agreement or grant of an option with respect to assets, in each case, in a form reasonably satisfactory to it, in connection with any easements, permits, licenses, rights of way, options, surface leases or other surface rights or interests permitted by the Loan Documents to be granted or a Disposition permitted by the Loan Documents and (iii) enter into the Intercreditor Agreements and a Receivables Related Standstill Agreement.
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Each Secured Party agrees to be bound by the Intercreditor Agreements and the Receivables Related Standstill Agreement.
The Borrower shall deliver to the Administrative Agent or the Collateral Agent such certificates and other documentation as such Agent(s) may reasonably request to evidence compliance with the applicable provisions of the Loan Documents.
10.11 No Reliance on Administrative Agent’s Customer Identification Programs.
Each Lender acknowledges and agrees that neither such Lender, nor any of its Affiliates, participants or assignees, may rely on the Administrative Agent to carry out such Lender’s, Affiliate’s, participant’s or assignee’s customer identification program, or other obligations required or imposed under or pursuant to the USA PATRIOT Act or the regulations thereunder, including the regulations contained in 31 CFR 103.121 (as hereafter amended or replaced, the “CIP Regulations”), or any other Anti-Terrorism Law, including any programs involving any of the following items relating to or in connection with any of the Loan Parties, their Affiliates or their agents, the Loan Documents or the transactions hereunder or contemplated hereby: (i) any identity verification procedures, (ii) any recordkeeping, (iii) comparisons with government lists, (iv) customer notices or (v) other procedures required under the CIP Regulations or such other Laws.
10.12 Withholding Tax.
To the extent required by any applicable Law (as determined in good faith by the Administrative Agent), the Administrative Agent may withhold from any payment to any Lender under any Loan Document an amount equivalent to any applicable withholding Tax. Without limiting or expanding the provisions of Section 5.9 [Taxes], each Lender shall indemnify and hold harmless the Administrative Agent against, and shall make payable in respect thereof within 10 days after demand therefor, all Taxes and all related losses, claims, liabilities and expenses (including fees, charges and disbursements of any counsel for the Administrative Agent) incurred by or asserted against the Administrative Agent by the IRS or any other Official Body as a result of the failure of the Administrative Agent to properly withhold Tax from amounts paid to or for the account of such Lender for any reason (including because the appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reduction of withholding Tax ineffective). A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document against any amount due the Administrative Agent under this Section 10.12 [Withholding Tax]. The agreements in this Section 10.12 [Withholding Tax] shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all other obligations. For the avoidance of doubt, the term “Lender” shall, for purposes of this Section 10.12 [Withholding Tax], include any Issuing Lender and any Swingline Lender.
10.13 Certain ERISA Matters.
(a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Collateral Agent and any Lead Arranger and their respective Affiliates and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:
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(i) such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit Plans with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit or the Commitments,
(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or
(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
In addition, unless either (1) sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or (2) a Lender has provided another representation, warranty and covenant in accordance with sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and any Lead Arranger and their respective Affiliates and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that none of the Administrative Agent or any Lead Arranger or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender involved in such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).
10.14 [Reserved].
10.15 Certain Payments.
(a) Each Lender hereby agrees that (i) if the Administrative Agent notifies such Lender that the Administrative Agent has determined in its sole discretion that any funds received by such Lender from the Administrative Agent or any of its Affiliates were erroneously transmitted to, or otherwise erroneously or mistakenly received by, such Lender (whether or not known to such Lender (whether
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as a payment, prepayment or repayment of principal, interest, fees or otherwise), individually and collectively, an “Erroneous Payment”) and demands the return of such Erroneous Payment (or a portion thereof), such Lender shall forthwith return to the Administrative Agent the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made, in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Lender to the date such amount is repaid to the Administrative Agent in same day funds at the greater of the Federal Funds Open Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect, and (ii) such Lender shall not assert any right or claim to the Erroneous Payment, and hereby waives any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by the Administrative Agent for the return of any Erroneous Payments received, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine. A notice by the Administrative Agent to any Lender under this Section 10.15(a) shall be conclusive, absent manifest error.
(b) Without limiting immediately Section 10.15(a), each Lender hereby further agrees that if it receives an Erroneous Payment from the Administrative Agent (or any of its Affiliates) (i) that is in an amount different than (other than a de minimis difference), or on a different date from, that specified in a notice of payment sent by the Administrative Agent (or any of its Affiliates) with respect to such Erroneous Payment (an “Erroneous Payment Notice”), or (ii) that was not preceded or accompanied by an Erroneous Payment Notice, it shall be on notice that, in each such case, an error has been made with respect to such Erroneous Payment. Each Lender further agrees that, in each such case, or if it otherwise becomes aware an Erroneous Payment (or portion thereof) may have been sent in error, such Lender shall promptly notify the Administrative Agent of such occurrence and, upon demand from the Administrative Agent, it shall forthwith return to the Administrative Agent the amount of any such Erroneous Payment (or portion thereof) that was received by such Lender to the date such amount is repaid to the Administrative Agent in same day funds at the greater of the Federal Funds Open Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect.
(c) The Borrower and each other Loan Party hereby agree that (i) in the event an Erroneous Payment (or portion thereof) is not recovered from any Lender that has received such Erroneous Payment (or portion thereof) for any reason, the Administrative Agent shall be subrogated to all the rights of such Lender with respect to such amount and (ii) an Erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by the Borrower or any other Loan Party.
(d) References in this Section 10.15 to “Lender” includes each Issuing Lender.
(e) Each party’s obligations under this Section 10.15 shall survive the resignation or replacement of the Administrative Agent or any transfer of rights or obligations by, or the replacement of, a Lender, the termination of the Commitments or the repayment, satisfaction or discharge of all Obligations (or any portion thereof) under any Loan Document.
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11. MISCELLANEOUS
11.1 Modifications, Amendments or Waivers.
11.1.1 Required Consents.
With the written consent of the Required Lenders (but subject to the last sentence hereof and the provisions of Section 4.1.4 [Conforming Changes Relating to Term SOFR Rate or Daily Simple SOFR], Section 4.6 [Benchmark Replacement Setting], Section 10.10 [Authorization to Release Collateral and Guarantors], Section 11.1.2 [Certain Amendments] and Section 11.1.3 [Amendments Affecting the Agents, Etc.]), the Administrative Agent, acting on behalf of all the Lenders, and the Borrower, on behalf of the Loan Parties, may from time to time enter into written agreements amending or changing any provision of this Agreement or any other Loan Document or the rights of the Lenders or the Loan Parties hereunder or thereunder, or may grant written waivers or consents hereunder or thereunder; provided that no consent of any Lender is required for actions authorized by Section 10.10 [Authorization to Release Collateral and Guarantors]. Any such agreement, waiver or consent made with such written consent shall be effective to bind all the Lenders and the Loan Parties; provided that no such agreement, waiver or consent may be made which will:
(a) increase the amount of the Revolving Credit Commitments of any Class or commitment to make Term Loans of any Lender hereunder without the consent of such Lender;
(b) whether or not any Loans are outstanding, extend any Maturity Date or the time for payment of principal, premium or interest of any Loan, the Commitment Fee or any other fee payable to any Lender, or reduce the principal amount of, premium of or the rate of interest borne by any Loan or reduce the Commitment Fee or any other fee payable to any Lender, or reduce, remove or shorten the period of applicability of any prepayment premium, without the consent of each Lender directly affected thereby (it being understood that the waiver of (or amendment to the terms of) any mandatory prepayment of the Loans, changes to Section 8.2.13 [Financial Covenants] or definitions used therein or the application (or waiver of application) of any rate increase described in Section 4.3 [Interest After Default] shall not constitute a postponement of any date scheduled for the payment of principal or interest or a reduction of principal, interest or fees);
(c) except as otherwise provided in or permitted by this Agreement, without the written consent of all the Lenders (other than Defaulting Lenders), release all or substantially all of the Guarantors (as measured by fair market value of their assets) from their Obligations under the Guaranty Agreement;
(d) except as otherwise provided in or permitted by this Agreement, without the written consent of all the Lenders (other than Defaulting Lenders), release all or substantially all of the Collateral (as measured by fair market value of the Collateral); provided that in the event that the Borrower provides any applicable Issuing Lender with Cash Collateral to secure any Letters of Credit with an expiry date beyond the Revolving Maturity Date pursuant to Section 2.9.10 [Cash Collateral Prior to the Revolving Maturity Date], such Issuing Lender is permitted to release such Cash Collateral without the consent of any Lender once such Letter of Credit has terminated, expired or has otherwise been returned to such Issuing Lender undrawn;
(e) amend Section 2.4.1 [Revolving Credit Commitments] with respect to the provision regarding ratable reduction of Revolving Credit Commitments, Section 5.2 [Pro Rata Treatment of Lenders], Section 5.3 [Sharing of Payments by Lenders] or Section 9.2.5 [Application of Proceeds] or requiring all Lenders to authorize the taking of any action or reduce any percentage specified in the definitions of “Required Class Lenders,” “Required Lenders,” “Required Revolving Lenders” or “Ratable Share,” in each case without the consent of all affected Lenders;
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(f) amend this Section 11.1 [Modifications, Amendments or Waivers] in a manner that would reduce the voting rights of any Lender without consent of such affected Lender; or
(g) except to the extent expressly otherwise permitted pursuant to this Agreement and the other Loan Documents, without the consent of each affected Lender: (A) subordinate any Obligations in right of payment to any other Indebtedness or (B) subordinate any Lien on a material portion of the Collateral securing the Obligations to any Lien securing any other Indebtedness.
Notwithstanding the foregoing, any condition precedent set forth in Section 7.2 [Each Additional Loan or Letter of Credit] to any extension of credit under the Revolving Credit Commitments may be amended or waived only with the consent of the Required Revolving Lenders (and the consent of no other Person shall be required).
11.1.2 Certain Amendments.
Notwithstanding Section 11.1.1(a) [Required Consents] or any other provision in any Loan Document to the contrary, the Borrower and the Administrative Agent (or to the extent relating to Collateral, the Collateral Agent), on behalf of the Lenders and without any consent or action by any Lender, may amend, modify, supplement or restate in whole or in part any of the Loan Documents from time to time or consent to such action by the Collateral Agent to (i) cure any defect or error, (ii) comply with any provision hereunder or under any other Loan Document, (iii) add Guarantors of the Obligations, (iv) add property or other assets as Collateral, (v) add covenants of the Borrower or the other Loan Parties for the benefit of the Lenders or to surrender any right or power herein conferred upon the Borrower or any of the other Loan Parties, (vi) approve of any correction or update to any Schedule hereto or to any other Loan Document to the extent such Schedule is being corrected in any manner that is not material or is being updated to reflect the consummation of any transaction or exercise of any rights of the Loan Parties permitted hereunder for which no consent is required or for which the required consent has been received, (vii) release from perfection any Lien created by any Loan Document that is no longer required by the terms hereof or such Loan Document to be perfected, or (viii) share Collateral on a pro rata basis with any counterparty to a Specified Swap Agreement described in clause (b) of the definition of “Specified Swap Agreement.”
11.1.3 Amendments Affecting the Agents, Etc.
No agreement, waiver or consent which would modify the interests, rights or obligations of any Agent, the Swingline Lender or any Issuing Lender may be made without the written consent of such Agent, the Swingline Lender or such Issuing Lender, as applicable. Furthermore, notwithstanding anything contained in any Loan Document, each fee letter entered into between the Borrower and an Agent may only be amended, waived, consented to or otherwise modified with the consent of each such Agent and the Borrower and no other Person shall be required to or have the right to consent to any such amendment, waiver, consent or modification of such fee letter.
11.1.4 Non-Consenting Lenders.
If in connection with any proposed waiver, amendment or modification referred to in any of the clauses (a) through (f) in Section 11.1.1 [Required Consents], the consent of the Required Lenders, Required Revolving Lenders or Required Class Lenders, as applicable, is obtained but the consent of one or more of other Lenders whose consent is required is not obtained (each a “Non-Consenting Lender”), then the Borrower shall have the right to replace any such Non-Consenting Lender with one or more replacement Lenders pursuant to Section 5.6.2 [Replacement of a Lender].
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11.1.5 Defaulting Lenders.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (i) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender and (ii) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.
11.2 No Implied Waivers; Cumulative Remedies.
No course of dealing and no delay or failure of any Agent or any Lender in exercising any right, power, remedy or privilege under this Agreement or any other Loan Document shall affect any other or future exercise thereof or operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any further exercise thereof or of any other right, power, remedy or privilege. The rights and remedies of the Agents and the Lenders under this Agreement and any other Loan Documents are cumulative and not exclusive of any rights or remedies which they would otherwise have.
11.3 Expenses; Indemnity; Damage Waiver.
11.3.1 Costs and Expenses.
The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Lead Arrangers, the Agents and their respective Affiliates (including the reasonable fees, charges and disbursements of outside counsel and land professionals for the Agents), and shall pay all reasonable fees in connection with the syndication of the credit facilities provided for herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by any Issuing Lender in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, (iii) all reasonable out-of-pocket expenses incurred by any Agent, any Lender or any Issuing Lender (including the reasonable fees, charges and disbursements of any counsel for any Agent, any Lender or any Issuing Lender), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section 11.3 [Expenses; Indemnity; Damage Waiver], or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such reasonable out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit, (iv) [reserved] and (v) all reasonable out-of-pocket expenses of any Agent’s regular employees and agents engaged periodically to perform audits of the Loan Parties’ books, records and business properties.
11.3.2 Indemnification by the Borrower.
The Borrower shall indemnify the Lead Arrangers, the Bookrunners, each Agent (and any sub-agent thereof), each Lender and each Issuing Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and reasonable out-of-pocket related expenses (including the fees, charges and disbursements of any outside counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower or any other Loan Party or any Subsidiary of Borrower arising out of, in connection with, or as a result of (i) the execution,
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enforcement or delivery of this Agreement, any other Loan Document, or any agreement or instrument contemplated hereby or thereby, the performance or nonperformance by the Loan Parties of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Lender to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any breach of representations, warranties or covenants of any Loan Party under the Loan Documents or any breach of any representation or warranty in the certificate delivered pursuant to Section 7.1.1(h)(ii) [Deliveries], (iv) any actual or alleged presence or Release of Hazardous Materials at, on, under or from any facility currently or formerly owned or operated by the Borrower or any of its Subsidiaries or any Environmental Liability relating in any way to the Borrower or any of its Subsidiaries, (v) [reserved] or (vi) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any of its Subsidiaries, and regardless of whether any Indemnitee is a party thereto; provided that the Borrower shall not be liable for any portion of any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements with respect to an Indemnitee (A) if the same is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnitee’s gross negligence or willful misconduct or (B) results from a dispute solely among Indemnitees (other than any claims against an Indemnitee in its capacity or in fulfilling its role as an Agent or arranger, bookrunner or any similar role under this Agreement and other than any claims arising out of any act or omission of the Borrower or any of its Affiliates). The Indemnitees will attempt to minimize the fees and expenses of legal counsel for the Indemnitees which are subject to reimbursement by the Borrower hereunder by considering the usage of one law firm to represent the Indemnitees if appropriate under the circumstances. This Section 11.3.2 shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.
11.3.3 Reimbursement by Lenders.
To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under Section 2.9.8 [Indemnity], Section 11.3.1 [Costs and Expenses] or Section 11.3.2 [Indemnification by the Borrower] to be paid by it to any Agent (or any sub-agent thereof), the Issuing Lenders or any Related Party of any of the foregoing, each Lender severally agrees to pay to such Agent (or any such sub-agent), the Issuing Lenders or such Related Party, as the case may be, such Lender’s Ratable Share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against an Agent (or any such sub-agent) or an Issuing Lender in its capacity as such, or against any Related Party of any of the foregoing acting for such Agent (or any such sub-agent) or such Issuing Lender in connection with such capacity.
11.3.4 Waiver of Consequential Damages, Etc.
No Indemnitee shall be liable for any damages arising from the use by others of any information or other materials obtained through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby, except to the extent such damages are found to be a final, non-appealable judgment of a court to arise from the gross negligence or willful misconduct of such Indemnitee, nor shall any Indemnitee, Loan Party or any Subsidiary have any liability for any special, punitive, indirect or consequential damages (as opposed to direct or actual damages) relating to this Agreement or any other Loan Document or arising out of its activities in connection herewith or therewith (whether before or after the Closing Date); it being agreed that this sentence shall not limit the indemnification obligations of the Loan Parties pursuant to Section 11.3.2 [Indemnification by the Borrower].
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11.3.5 Payments.
All amounts due under this Section 11.3 [Expenses; Indemnity; Damage Waiver] shall be payable not later than ten (10) days after demand therefor.
11.4 Holidays.
Whenever payment of a Loan to be made or taken hereunder shall be due on a day which is not a Business Day, such payment shall be due on the next Business Day (except as provided in Section 4.2 [Interest Periods]) and such extension of time shall be included in computing interest and fees, except that the Loans shall be due on the Business Day preceding the applicable Maturity Date if such Maturity Date is not a Business Day. Whenever any payment or action to be made or taken hereunder (other than payment of the Loans) shall be stated to be due on a day which is not a Business Day, such payment or action shall be made or taken on the next following Business Day, and such extension of time shall not be included in computing interest or fees, if any, in connection with such payment or action.
11.5 Notices; Effectiveness; Electronic Communication.
11.5.1 Notices Generally.
Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in Section 11.5.2 [Electronic Communications]), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier (i) if to a Lender, to it at its address set forth in its administrative questionnaire, or (ii) if to any other Person, to it at its address set forth on Schedule 11.5.1.
Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient). Notices delivered through electronic communications to the extent provided in Section 11.5.2 [Electronic Communications], shall be effective as provided in such Section.
11.5.2 Electronic Communications.
Notices and other communications to the Lenders and the Issuing Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender or any Issuing Lender if such Lender or Issuing Lender, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication and the Administrative Agent shall have notified the Borrower of the same. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications. Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement); provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.
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11.5.3 Change of Address, Etc.
Any party hereto may change its address, e-mail address or telecopier number for notices and other communications hereunder by notice to the other parties hereto.
11.6 Severability.
The provisions of this Agreement are intended to be severable. If any provision of this Agreement shall be held invalid or unenforceable in whole or in part in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without in any manner affecting the validity or enforceability thereof in any other jurisdiction or the remaining provisions hereof in any jurisdiction.
11.7 Duration; Survival.
All representations and warranties of the Loan Parties contained herein or made in connection herewith shall survive the execution and delivery of this Agreement, the completion of the transactions hereunder and Payment In Full. All covenants and agreements of the Loan Parties contained herein relating to the payment of principal, interest, premiums, additional compensation or expenses and indemnification, including those set forth in the Notes, Section 2.9.8 [Indemnity], Section 2.9.10 [Cash Collateral Prior to the Revolving Maturity Date], Section 5 [Payments] and Section 11.3 [Expenses; Indemnity; Damage Waiver], shall survive payment in full of all principal and interest under the Notes, the termination of the Commitments and the expiration or termination or cash collateralization of all Letters of Credit. All other covenants and agreements of the Loan Parties shall continue in full force and effect from and after the date hereof and until Payment In Full.
11.8 Successors and Assigns.
11.8.1 Successors and Assigns Generally.
The provisions of this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Agents and each Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of Section 11.8.2 [Assignments by Lenders], (ii) by way of participation in accordance with the provisions of Section 11.8.4 [Participations], or (iii) by way of pledge or assignment of a security interest subject to the restrictions of Section 11.8.5 [Certain Pledges; Successors and Assigns Generally] (and, except as set forth in Section 11.8.2(f) [No Assignment to Disqualified Person], any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in Section 11.8.4 [Participations], the Lead Arrangers, the Bookrunners and, to the extent expressly contemplated hereby, the Related Parties of each of the Agents, the Issuing Lenders and the Lenders, and as set forth in Section 11.13 [Certain Collateral Matters]) any legal or equitable right, remedy or claim under or by reason of this Agreement or any other Loan Document.
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11.8.2 Assignments by Lenders.
Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it); provided that any such assignment shall be subject to the following conditions:
(a) Minimum Amounts.
(i) in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and
(ii) in any case not described in clause (a)(i) of this Section 11.8.2, the aggregate amount of the Revolving Credit Commitment of any Class (which for this purpose includes Revolving Credit Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Revolving Credit Loans of such Class of the assigning Lender and the principal outstanding balance of the Term Loans of the assigning Lender, in each case, subject to each such assignment (determined as of the Trade Date) shall not be less than $5,000,000, in the case of any assignment in respect of the Revolving Credit Commitment of any Class, Revolving Credit Loans or Term Loans, unless the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed).
(b) Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loan or the Commitment assigned.
(c) Required Consents. Each assignment shall be subject to the consent of the following Persons (which shall not be unreasonably withheld or delayed):
(i) the Administrative Agent;
(ii) the Borrower, unless an Event of Default under Section 9.1.1 [Payments Under Loan Documents], Section 9.1.12 [Involuntary Proceedings] or Section 9.1.13 [Voluntary Proceedings] has occurred and is continuing at the time of such assignment; provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received notice thereof; provided that in no event shall the Borrower be deemed to have consented to any assignment to a Disqualified Person pursuant to this sentence;
(iii) in the case of an assignment of Revolving Credit Commitments of any Class, each Issuing Lender with a Letter of Credit Issuing Lender Sublimit that is, at the time of such proposed assignment, among the five highest Letter of Credit Issuing Lender Sublimits at such time;
(iv) in the case of an assignment of Revolving Credit Commitments of any Class, the Swingline Lender;
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provided that no consent of the Administrative Agent or the Borrower shall be required in the case of an assignment to a Lender, an Affiliate of a Lender or, in the case of an assignment of Term Loans, an Approved Fund.
(d) Assignment and Assumption Agreement. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption Agreement, together with a processing and recordation fee of $3,500 from the assignor or the assignee, and the assignee, if it is not a Lender, shall deliver to the Administrative Agent an administrative questionnaire provided by the Administrative Agent.
(e) Prohibited Assignments. No such assignment or participation shall be made to (i) the Borrower or any of the Borrower’s Affiliates or Subsidiaries, (ii) any natural person, or (iii) any Defaulting Lender.
(f) No Assignment to Disqualified Person. No assignment or participation shall be made to any Person that was a Disqualified Person as of the applicable Trade Date with respect to such assignment or participation (unless the Borrower has consented to such assignment in writing in its sole and absolute discretion, in which case such Person will not be considered a Disqualified Person for the purpose of such assignment or participation). For the avoidance of doubt, with respect to any assignee that becomes a Disqualified Person after the applicable Trade Date, such assignee shall not retroactively be disqualified from being a Lender. Any assignment in violation of this clause (f) shall not be void, but the other provisions of this clause (f) shall apply:
(i) if any assignment is made to any Disqualified Person without the Borrower’s prior written consent in violation of this Section 11.8.2(f), the Borrower may, at its sole expense and effort, upon notice to the applicable Disqualified Person and the Administrative Agent, (A) in the case of outstanding Loans held by Disqualified Persons, purchase or prepay such Loan (and cancel such Commitment) by paying the lesser of (x) the outstanding principal amount of such Loans and (y) the amount that such Disqualified Person paid to acquire such Loans, in each case plus accrued interest, accrued fees and all other amounts (other than principal amounts) payable to it hereunder and under the other Loan Documents, without premium, penalty, prepayment fee or brokerage and/or (B) require such Disqualified Person to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in this Section 11.8.2(h)), all of its interest, rights and obligations under this Agreement and the other Loan Documents to one or more assignees permitted hereunder at the lesser of (x) the principal amount thereof and (y) the amount that such Disqualified Person paid to acquire such interests, rights and obligations, in each case plus accrued interest, accrued fees and all other amounts (other than principal amounts) payable to it hereunder and under the other Loan Documents, without premium, penalty, prepayment fee or brokerage; provided that (i) the Borrower shall have paid to the Administrative Agent any required assignment fee (if any) and (ii) such assignment does not conflict with applicable Laws.
(ii) Notwithstanding anything to the contrary contained in this Agreement, Disqualified Persons (A) will not (x) have the right to receive information, reports or other materials provided to Lenders by the Borrower, any Agent or any other Lender, (y) attend or participate in meetings attended by the Lenders and/or any Agent, or (z) access any electronic site established for the Lenders or confidential communications from counsel to or financial advisors of the Agents or the Lenders, (B) (x) for purposes of any consent to any amendment, waiver or modification of, or any action under, and for the purpose of any direction to the Agents or any Lender to undertake any action (or refrain from taking any action) under this Agreement or any other Loan Document, each Disqualified Person will be deemed to have consented in the same proportion as
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the Lenders that are not Disqualified Persons consented to such matter, and (y) for purposes of voting on any plan of reorganization or plan of liquidation pursuant to any Debtor Relief Laws (a “Reorganization Plan”), each Disqualified Person party hereto hereby agrees (1) not to vote on such Reorganization Plan, (2) if such Disqualified Person does vote on such Reorganization Plan notwithstanding the restriction in the foregoing clause (1), such vote will be deemed not to be in good faith and shall be “designated” pursuant to Section 1126(e) of the Bankruptcy Code (or any similar provision in any other Debtor Relief Laws), and such vote shall not be counted in determining whether the applicable “class” has accepted or rejected such Reorganization Plan in accordance with Section 1126(c) of the Bankruptcy Code (or any similar provision in any other Debtor Relief Laws) and (3) not to contest any request by any party for a determination by the bankruptcy court (or other applicable court of competent jurisdiction) effectuating the foregoing clause (2), and (C) will not be entitled to any expense reimbursement or indemnification rights; it being understood and agreed that the foregoing provisions shall only apply to a Disqualified Person and not to any assignee of such Disqualified Person that becomes a Lender so long as such assignee is not a Disqualified Person or an Affiliate thereof.
(iii) The Administrative Agent shall have the right, and the Borrower hereby expressly authorizes the Administrative Agent, to (A) post the list of Disqualified Persons provided by the Borrower and any updates thereto from time to time to the Lenders (including “public side” Lenders) (it being understood that the list of Disqualified Persons shall not be effective until it has been posted to “public side” Lenders) or (B) provide the list of Disqualified Persons to each Lender requesting the same.
(iv) All parties hereto acknowledge and agree that the Administrative Agent shall not have any responsibility or liability for monitoring the list of or processing assignments to Disqualified Persons or compliance with the terms of any of the provisions set forth herein with respect to Disqualified Persons. Notwithstanding the foregoing or anything else to the contrary in this Agreement, each of the parties hereto acknowledges and agrees that the Administrative Agent (x) shall not have any responsibility or obligation to determine whether any Lender or any potential assignee Lender is a Disqualified Person or (y) shall have any liability with respect to any assignment or participation made to a Disqualified Person.
(g) Each assignment of the Revolving Credit Commitments of any Class by any Revolving Lender pursuant to this Section 11.8.2 shall automatically constitute and be deemed an assignment of its Letter of Credit Issuing Lender Sublimit to the assignee with respect to such Revolving Credit Commitments of such Class. If an Issuing Lender (or its Affiliate that is the Revolving Lender) assigns all of its Revolving Credit Commitments, such Issuing Lender shall retain all the rights, powers, privileges and duties of an Issuing Lender with respect to all Letters of Credit issued by it that remain outstanding as of the effective date of its resignation as Issuing Lender and all Letter of Credit Obligations with respect thereto, including the right to require the Lenders to make Participation Advances pursuant to Section 2.9.3 [Participations, Disbursements, Reimbursement], but shall not have any obligation to renew, extend, amend or increase any such Letter of Credit or issue any other Letter of Credit.
(h) Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 11.8.3 [Register], from and after the effective date specified in each Assignment and Assumption Agreement, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption Agreement, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption Agreement, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption Agreement covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but
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shall continue to be entitled to the benefits of Section 4.4 [Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs], Section 5.8 [Increased Costs], Section 5.9 [Taxes] and Section 11.3 [Expenses, Indemnity; Damage Waiver] with respect to facts and circumstances occurring prior to the effective date of such assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 11.8.2 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 11.8.4 [Participations].
11.8.3 Register.
The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain a record of the names and addresses of the applicable Lenders, and the Commitments of, and principal amounts (and related interest amounts) of the Loans owing to, each applicable Lender pursuant to the terms hereof from time to time (the “Register”). The Register shall be conclusive (absent manifest error), and the Borrower, the Administrative Agent, the Issuing Lenders and the Lenders shall treat each Person whose name is in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, the Agents and any Lender (in the case of such Lender, as to such Lender’s own interest only), at any reasonable time and from time to time upon reasonable prior notice.
11.8.4 Participations.
Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, the Borrower or any of the Borrower’s Affiliates or Subsidiaries or, solely to the extent provided in and subject to Section 11.8.2(f) [No Assignment to Disqualified Person], any Disqualified Person) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Agents, the Lenders and the Issuing Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.
Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver with respect to any of clause (a), (b), (c), (d), (e) or (f) of Section 11.1.1 [Required Consents]. The Borrower agrees that each Participant shall be entitled to the benefits of Section 4.4 [Term SOFR Rate or Daily Simple SOFR Unascertainable; Illegality; Increased Costs], Section 5.8 [Increased Costs] and Section 5.9 [Taxes] (subject to the requirements and limitations of such Sections and Sections 5.6.3 [Designation of a Different Lending Office] and 5.6.2 [Replacement of a Lender], and it being understood that the documentation required under Section 5.9.5 [Status of Lenders] shall be delivered solely to the participating Lender) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 11.8.2 [Assignments by Lenders]; provided that such Participant (A) shall be subject to the provisions of Section 5.6.2 [Replacement of a Lender] and Section 5.6.3 [Designation of a Different Lending Office] as if it were an assignee under Section 11.8.2 [Assignments by Lenders]; and (B) shall not be entitled to receive any greater payment under Section 5.8 [Increased Costs] or 5.9 [Taxes], with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. Each Lender that
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sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 5.6.2 [Replacement of a Lender] and Section 5.6.3 [Designation of Different Lending Office] with respect to any Participant. To the extent permitted by Law, each Participant also shall be entitled to the benefits of Section 9.2.3 [Set-off] as though it were a Lender; provided such Participant agrees to be subject to Section 5.3 [Sharing of Payments by Lenders] as though it were a Lender.
Each Lender that sells participations to a Participant, acting solely for this purpose as a non-fiduciary agent of the Borrower, shall maintain a register of all such Participants on which it enters the name and address of each Participant and the principal amounts (and related interest amounts) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”). The entries in the Participant Register shall be conclusive (absent manifest error), and the Borrower and the Lenders shall treat each Person whose name is recorded in the Participant Register pursuant to the terms hereof as a Participant for all purposes of this Agreement, notwithstanding notice to the contrary; provided that no Lender shall have the obligation to disclose all or a portion of the Participant Register (including the identity of the Participant or any information relating to a Participant’s interest in any Loans or other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary in connection with a Tax audit or other proceeding to establish that any loans are in registered form for U.S. federal income tax purposes. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
11.8.5 Certain Pledges; Successors and Assigns Generally.
Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or any central bank having jurisdiction; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
11.9 Confidentiality.
11.9.1 General.
Each of the Agents, the Lenders and the Issuing Lenders agrees to maintain the confidentiality of the Information, except that Information may be disclosed (i) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, advisors and other representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (ii) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (iii) to the extent required by applicable Laws or regulations or by any subpoena or similar legal process, (iv) to any other party hereto, (v) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (vi) subject to an agreement containing provisions substantially the same as those of this Section 11.9, to (a) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement (it being understood that any such prospective assignee or Participant may be provided the list of Disqualified Persons) or (b) any actual or prospective counterparty (or its advisors) to any Swap Agreement or derivative transaction relating to the Borrower and its obligations, (vii) with the consent of the Borrower, (viii) to the extent such Information (a) becomes publicly available other than as a result of a breach of this Section 11.9 or (b) becomes available
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to any Agent, any Lender, any Issuing Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower, the other Loan Parties or any other Person that has obtained such confidential information pursuant to this Section 11.9 or (ix) on a confidential basis to (a) any rating agency in connection with rating the Borrower or its Subsidiaries or the credit facilities provided hereunder, (b) information regarding the credit facilities provided hereunder to (x) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities provided hereunder or (y) market data collectors and service providers to the Agents and the Lenders in connection with the administration, settlement and management of this Agreement and the credit facilities provided hereunder. Any Person required to maintain the confidentiality of Information as provided in this Section 11.9 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
11.9.2 Sharing Information With Affiliates of the Lenders.
Each Loan Party acknowledges that from time to time financial advisory, investment banking and other services may be offered or provided to the Borrower or one or more of its Affiliates (in connection with this Agreement or otherwise) by any Lender or by one or more Subsidiaries or Affiliates of such Lender, and each of the Loan Parties hereby authorizes each Lender to share any information delivered to such Lender by such Loan Party and its Subsidiaries pursuant to this Agreement to any such Subsidiary or Affiliate subject to the provisions of Section 11.9.1 [General].
11.10 Counterparts; Integration; Effectiveness.
This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to a Lender or any Affiliate of a Lender, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof including any prior confidentiality agreements and commitments. Except as provided in Section 7 [Conditions of Lending and Issuance of Letters of Credit], this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Agreement.
The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to any document to be signed in connection with this Agreement, any Assignment and Assumption Agreement or any other Loan Document and the transactions contemplated hereby or thereby shall be deemed to include an electronic symbol or process attached to a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record (each an “Electronic Signature”), deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that nothing in any Loan Document shall require any Agent to accept Electronic Signatures from any Loan Party in any form or format without such Agent’s prior written consent. Each Loan Party represents and warrants that it has the corporate capacity and authority to execute the Loan Documents through electronic means and there are no restrictions for doing so in such Loan
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Party’s constitutive documents. Without limiting the generality of the foregoing, each Loan Party (i) agrees that, for all purposes, including without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceedings or litigation among any Agent, the Lenders and the Loan Parties, electronic images of this Agreement or any other Loan Documents (in each case, including with respect to any signature pages thereto) shall have the same legal effect, validity and enforceability as any paper original, and (ii) waives any argument, defense or right to contest the validity or enforceability of the Loan Documents based solely on the lack of paper original copies of any Loan Documents, including with respect to any signature pages thereto.
11.11 Governing Law, Etc.
11.11.1 Governing Law.
This Agreement shall be deemed to be a contract under the Laws of the State of New York without regard to its conflict of laws principles. Each Standby Letter of Credit issued under this Agreement shall be subject either to the rules of the Uniform Customs and Practice for Documentary Credits, as most recently published by the International Chamber of Commerce at the time of issuance (“UCP”) or the rules of the International Standby Practices (ICC Publication Number 590), as determined by the Issuing Lender, and each Commercial Letter of Credit shall be subject to UCP, and in each case to the extent not inconsistent therewith, the Laws of the State of New York without regard to its conflict of laws principles.
11.11.2 SUBMISSION TO JURISDICTION.
THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ANY AGENT, ANY LENDER OR ANY ISSUING LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.
11.11.3 WAIVER OF VENUE.
THE BORROWER AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
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ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN SECTION 11.11.2 [SUBMISSION TO JURISDICTION]. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT AND AGREES NOT TO ASSERT ANY SUCH DEFENSE.
11.11.4 SERVICE OF PROCESS.
EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 11.5 [NOTICES; EFFECTIVENESS; ELECTRONIC COMMUNICATION]. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
11.11.5 WAIVER OF JURY TRIAL.
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.11.5.
11.12 Mutual Negotiations.
This Agreement and the other Loan Documents are the product of mutual negotiations by the parties thereto and their counsel, and no party shall be deemed the draftsperson of this Agreement or any other Loan Document or any provision hereof or thereof or to have provided the same. Accordingly, in the event of any inconsistency or ambiguity of any provision of this Agreement or any other Loan Document, such inconsistency or ambiguity shall not be interpreted against any party because of such party’s involvement in the drafting thereof.
11.13 Certain Collateral Matters.
The benefit of the Loan Documents and of the provisions of this Agreement relating to any Collateral securing the Obligations shall also extend to and be available to the Secured Parties. No Lender or any Affiliate of a Lender shall have any voting rights under any Loan Document as a result of the existence of obligations owed to it under any Specified Swap Agreement or any Other Lender Provided Financial Service Product, and no Person shall have any voting rights under any Loan Document solely because of such Person’s status as an Indemnitee.
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11.14 USA PATRIOT Act Notice.
Each Lender that is subject to the USA PATRIOT Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Loan Parties that pursuant to the requirements of the USA PATRIOT Act, it is required to obtain, verify and record information that identifies the Loan Parties, which information includes the name and address of Loan Parties and other information that will allow such Lender or Administrative Agent, as applicable, to identify the Loan Parties in accordance with the USA PATRIOT Act.
11.15 No Fiduciary Duty.
Each Loan Party agrees and acknowledges that: (i) each Secured Party is acting solely as a principal and is not a financial advisor, agent or fiduciary, for the Loan Parties or any of their respective Affiliates, stockholders, creditors or employees or any other party; (ii) no Secured Party has assumed or will assume an advisory, agency or fiduciary responsibility in any Loan Party’s or their respective Affiliates’ favor with respect to any of the transactions contemplated hereby (irrespective of whether any Secured Party has advised or is currently advising any Loan Party or its Affiliates on other matters) and no Secured Party has any obligation to the Loan Parties or their respective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein; (iii) the Secured Parties and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from the Loan Parties or their respective Affiliates and the Secured Parties have no obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (iv) the Lenders have not provided any legal, accounting, regulatory or tax advice in any jurisdiction with respect to any of the transactions contemplated hereby and the Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate. Each Loan Party acknowledges and agrees that it will consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and neither any Secured Party nor its Affiliates shall have any responsibility or liability to any Loan Party with respect thereto. Each Loan Party hereby waives and releases, to the fullest extent permitted by law, any claims that such Loan Party may have against the Secured Parties or their respective Affiliates with respect to any breach or alleged breach of agency or fiduciary duty.
11.16 Acknowledgment and Consent to Bail-In of Affected Financial Institutions.
Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an Affected Financial Institution; and
(b) the effects of any Bail-In Action on any such liability, including, if applicable:
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
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(iii) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.
11.17 Acknowledgement Regarding Any Supported QFCs.
To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Hedging Obligations or any other agreement or instrument that is a QFC (such support, “QFC Credit Support” and each such QFC, a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):
(a) In the event a Covered Entity/Bank/FSI that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.
(b) As used in this Section 11.17, the following terms have the following meanings:
“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.
“Covered Entity/Bank/FSI” shall mean any of the following:
| i. | a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); |
| ii. | a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or |
| iii. | a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b). |
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.
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“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).
[SIGNATURE PAGES INTENTIONALLY OMITTED]
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SCHEDULE 1.1(A)
PRICING GRID
| Applicable Margin | ||||||||||
| Level |
Total Net Leverage Ratio | Term SOFR Loans / Daily Simple SOFR Loans |
Base Rate Loans |
|||||||
| I |
< 0.50:1.00 | 3.00 | % | 2.00 | % | |||||
| II |
≥ 0.50:1.00 and < 1.00:1.00 | 3.25 | % | 2.25 | % | |||||
| III |
≥ 1.00:1.00 and < 1.50:1.00 | 3.50 | % | 2.50 | % | |||||
| V |
≥ 1.50:1.00 | 3.75 | % | 2.75 | % | |||||
For purposes of determining the Applicable Margin and the Applicable Letter of Credit Fee Rate:
(a) From and including the Amendment No. 6 Effective Date through the date on which the Compliance Certificate is required to be delivered hereunder in respect of the period ending December 31, 2024 (the “Initial Period”), the Applicable Margin and the Applicable Letter of Credit Fee Rate with respect to Revolving Credit Loans shall be the respective amounts set forth under Level I of the table set forth immediately above.
(b) It is expressly agreed that after the Initial Period, the Applicable Margin and the Applicable Letter of Credit Fee Rate with respect to Revolving Credit Loans shall be determined based upon the table set forth immediately above and change on each date on which a Compliance Certificate is required to be delivered hereunder.
(c) If, as a result of any restatement of or other adjustment to the financial statements of the Borrower or for any other reason, the Borrower or the Lenders determine that (i) the Total Net Leverage Ratio as calculated by the Borrower as of any applicable date was inaccurate and (ii) a proper calculation of the Total Net Leverage Ratio would have resulted in higher pricing for such period, the Borrower shall immediately and retroactively be obligated to pay to the Administrative Agent for the account of the Revolving Lenders, promptly on demand by the Administrative Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, automatically and without further action by the Administrative Agent, any Revolving Lender or Issuing Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period. This paragraph shall not limit the rights of the Administrative Agent, any Revolving Lender or Issuing Lender, as the case may be, under Section 2.9 [Letters of Credit] or Section 4.3 [Interest After Default] or Section 9 [Default]. The Borrower’s obligations under this paragraph shall survive the termination of the Commitments and the repayment of all other Obligations hereunder.
SCHEDULE 1.1(B)
COMMITMENTS OF LENDERS
| Lender | Revolving Credit Commitment | |
| PNC Bank, National Association |
$ 60,000,000.00 | |
| Axos Bank |
$ 40,000,000.00 | |
|
Burke & Herbert Bank |
$ 40,000,000.00 | |
| Dollar Bank, Federal Savings Bank |
$ 40,000,000.00 | |
| EverBank, N.A. |
$ 40,000,000.00 | |
| First National Bank of Pennsylvania |
$ 40,000,000.00 | |
| KeyBank National Association |
$ 40,000,000.00 | |
|
Manufacturers and Traders Trust Company |
$ 40,000,000.00 | |
| Northwest Bank |
$ 40,000,000.00 | |
| Regions Bank |
$ 40,000,000.00 | |
| Old National Bank |
$ 28,000,000.00 | |
| Texas Capital Bank |
$ 28,000,000.00 | |
| City National Bank of West Virginia |
$ 20,000,000.00 | |
| First Foundation Bank |
$ 20,000,000.00 | |
|
Independent Bank |
$ 17,000,000.00 | |
| Mid Penn Bank |
$ 13,000,000.00 | |
| First Fidelity Bank |
$ 9,000,000.00 | |
| Goldman Sachs Bank USA |
$ 9,000,000.00 | |
| ICICI Bank Canada |
$ 9,000,000.00 | |
| Somerset Trust Company |
$ 9,000,000.00 | |
| S&T Bank |
$ 9,000,000.00 | |
|
Washington Financial Bank |
$ 9,000,000.00 | |
|
TOTAL |
$ 600,000,000.00 |
EXHIBIT B
EXHIBIT 2.5.1
LOAN REQUEST
[see attached]
EXHIBIT C
EXHIBIT 2.5.2
SWING LOAN REQUEST
[see attached]
EXHIBIT D-1
EXHIBIT 5.9.5-1
FORM OF UNITED STATES TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Not Treated As Partnerships For U.S. Federal Income Tax Purposes)
[see attached]
EXHIBIT D-2
EXHIBIT 5.9.5-2
FORM OF UNITED STATES TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Treated As Partnerships For U.S. Federal Income Tax Purposes)
[see attached]
EXHIBIT D-3
EXHIBIT 5.9.5-3
FORM OF UNITED STATES TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Not Treated As Partnerships For U.S. Federal Income Tax Purposes)
[see attached]
EXHIBIT D-4
EXHIBIT 5.9.5-4
FORM OF UNITED STATES TAX COMPLIANCE CERTIFICATE
(For Foreign Participants That Are Treated As Partnerships For U.S. Federal Income Tax Purposes)
[see attached]
EXHIBIT E
EXHIBIT 8.2.6
FORM OF ACQUISITION CERTIFICATE
[see attached]
EXHIBIT F
EXHIBIT 8.3.4
QUARTERLY COMPLIANCE CERTIFICATE
[see attached]
EXHIBIT G-1
EXHIBIT 1.1(P)(1)
PERFECTION CERTIFICATE
[see attached]
EXHIBIT G-2
EXHIBIT 1.1(P)(2)
PERFECTION CERTIFICATE SUPPLEMENT
[see attached]
EXHIBIT H
AMENDED AND RESTATED SECURITY AGREEMENT
[see attached]
Exhibit 10.2
EXECUTION VERSION
NINTH AMENDMENT TO THIRD AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
THIS NINTH AMENDMENT TO THIRD AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (this “Amendment”), dated as of January 14, 2025, is entered into among ARCH RECEIVABLE COMPANY, LLC (the “Seller”), ARCH COAL SALES COMPANY, INC. (the “Servicer”), the various financial institutions party to the Agreement (as defined below) as Conduit Purchasers (the “Conduit Purchasers”), as Related Committed Purchasers (the “Related Committed Purchasers”), as LC Participants (the “LC Participants”), and as Purchaser Agents (the “Purchaser Agents”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as Administrator (the “Administrator”) and as LC Bank (the “LC Bank”; together with the Conduit Purchasers, the Related Committed Purchasers and the LC Participants, the “Purchasers”).
RECITALS
1. The parties hereto are parties to the Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 (as amended, restated, supplemented or otherwise modified through the date hereof, the “Agreement”).
2. Pursuant to the Arch Merger Agreement (as such term is defined in the Credit Agreement, the “Arch Merger Agreement”), on the date hereof, the Arch Merger (as such term is defined in the Credit Agreement, the “Arch Merger”) shall occur on the date hereof.
3. On or about the date on which the Arch Merger occurs, Arch Coal Sales Company, Inc. will change its registered name to Core Sales, Inc., and Arch Energy Resources, LLC will change its registered name to Core Global LLC (such name changes, the “Subject Name Changes”).
4. The parties hereto desire to amend the Agreement as hereinafter set forth.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1. Certain Defined Terms. Capitalized terms that are used but not defined herein shall have the meanings set forth in the Agreement.
SECTION 2. Amendments to the Agreement. The Agreement is hereby amended to incorporate the changes shown on the marked pages of the Agreement attached hereto as Exhibit A.
SECTION 3. Representations and Warranties. Each of the Seller and the Servicer hereby represents and warrants to the Administrator, the Purchaser Agents and the Purchasers as follows:
(a) Representations and Warranties. The representations and warranties made by such Person in the Agreement and each of the other Transaction Documents are true and correct as of the date hereof (unless stated to relate solely to an earlier date, in which case such representations or warranties were true and correct as of such earlier date).
(b) Enforceability. The execution and delivery by such Person of this Amendment, and the performance of each of its obligations under this Amendment and the Agreement, as amended hereby, are within each of its organizational powers and have been duly authorized by all necessary action on its part. This Amendment and the Agreement, as amended hereby, are such Person’s valid and legally binding obligations, enforceable in accordance with their respective terms.
(c) No Default. Both before and immediately after giving effect to this Amendment and the transactions contemplated hereby, no Termination Event or Unmatured Termination Event exists or shall exist.
SECTION 4. Effect of Amendment; Ratification. All provisions of the Agreement, as expressly amended and modified by this Amendment, shall remain in full force and effect. After this Amendment becomes effective, all references in the Agreement (or in any other Transaction Document) to “the Receivables Purchase Agreement”, “this Agreement”, “hereof”, “herein” or words of similar effect, in each case referring to the Agreement shall be deemed to be references to the Agreement as amended by this Amendment. This Amendment shall not be deemed, either expressly or impliedly, to waive, amend or supplement any provision of the Agreement other than as specifically set forth herein. The Agreement, as amended by this Amendment, is hereby ratified and confirmed in all respects.
SECTION 5. Effectiveness. This Amendment shall become effective as of the date hereof, when:
(a) the Administrator has received duly executed counterparts of this Amendment by each of the parties hereto; and
(b) the Arch Merger shall have occurred pursuant to the terms of the Arch Merger Agreement.
SECTION 6. Consent to Subject Name Changes. Each of the parties hereto hereby consents to the Subject Name Changes. For the avoidance of doubt, such consent shall not (i) apply to any change in the registered name, location, identity or corporate structure of any Originator, other than the Subject Name Changes as expressly described herein, and (ii) other than as provided herein, waive any requirement or provision of any Transaction Document applicable to the Subject Name Changes.
SECTION 7. Post-Closing Covenants.
(a) Within thirty (30) days following the date hereof (or any such other subsequent date as the Administrator may approve in writing in its sole discretion), each of the Seller, the Servicer and each Originator covenants and agrees to deliver to the Administrator:
(i) completed UCC search reports listing the financing statements filed in all applicable jurisdictions that name “Core Sales, Inc.” or “Core Global LLC” as debtor, together with copies of such other financing statements, and similar search reports with respect to judgment liens, federal tax liens and liens of the Pension Benefit Guaranty Corporation in such jurisdictions, as the Administrator may reasonably request, showing no Adverse Claims on any Pool Assets; and
2
(ii) such certificates, copies of organization documents of each Person affected by a Subject Name Change, resolutions or other action and incumbency certificates and/or other certificates of responsible officers of each such Person as the Administrator may reasonably require evidencing the identity, authority and capacity of each responsible officer thereof authorized to act as a responsible officer in connection with the Agreement and the other Transaction Documents to which such Person is a party.
(b) Within sixty (60) days following the date hereof (or any such other subsequent date as the Administrator may approve in writing in its sole discretion), each of the Seller, the Servicer and each Originator covenants and agrees to deliver to the Administrator:
(i) an executed assignment of the Performance Guaranty from ACI to Core Natural Resources, Inc. as Performance Guarantor and an amendment, amendment and restatement or other modification to the Performance Guaranty which replaces ACI with Core Natural Resources, Inc. as Performance Guarantor and names Core Natural Resources, Inc. as performance guarantor in each case in form and substance reasonably acceptable to the Administrator; and
(ii) one or more written opinions of counsel to Core Natural Resources, Inc. as to corporate and enforceability matters, (including, without limitation, opinions with respect to due authorization, enforceability, no conflicts with material agreements for borrowed money, New York law or organizational documents) in form and substance reasonably acceptable to the Administrator.
SECTION 8. Counterparts. This Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile or electronic transmission shall be effective as delivery of a manually executed counterpart hereof.
SECTION 9. Governing Law. This Amendment shall be governed by, and construed in accordance with, the internal laws of the State of New York (including for such purposes Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York).
SECTION 10. Section Headings. The various headings of this Amendment are included for convenience only and shall not affect the meaning or interpretation of this Amendment, the Agreement or any provision hereof or thereof.
SECTION 11. Successors and Assigns. This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns.
SECTION 12. Transaction Document. For the avoidance of doubt, each party hereto agrees that this Amendment constitutes a Transaction Document.
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SECTION 13. Severability. Each provision of this Amendment shall be severable from every other provision of this Amendment for the purpose of determining the legal enforceability of any provision hereof, and the unenforceability of one or more provisions of this Amendment in one jurisdiction shall not have the effect of rendering such provision or provisions unenforceable in any other jurisdiction.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
4
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above.
| ARCH RECEIVABLE COMPANY, LLC, as Seller | ||
| By: |
/s/ Matthew C. Giljum | |
| Name: | Matthew C. Giljum | |
| Title: | Treasurer and Vice President | |
| ARCH COAL SALES COMPANY, INC., as Servicer | ||
| By: |
/s/ Matthew C. Giljum | |
| Name: | Matthew C. Giljum | |
| Title: | Treasurer and Vice President | |
| S-1 | Ninth Amendment to Third A&R RPA (Arch Coal) |
| PNC BANK, NATIONAL ASSOCIATION, as Administrator | ||||
| By: | /s/ Christopher Blaney | |||
| Name: | Christopher Blaney Senior Vice President | |||
| Title: | ||||
| PNC BANK, NATIONAL ASSOCIATION, as a Purchaser Agent | ||||
| By: | /s/ Christopher Blaney | |||
| Name: | Christopher Blaney | |||
| Title: | Senior Vice President | |||
| PNC BANK, NATIONAL ASSOCIATION, as the LC Bank and as an LC Participant | ||||
| By: | /s/ Christopher Blaney | |||
| Name: | Christopher Blaney | |||
| Title: | Senior Vice President | |||
| PNC BANK, NATIONAL ASSOCIATION, as a Related Committed Purchaser | ||||
| By: | /s/ Christopher Blaney | |||
| Name: | Christopher Blaney | |||
| Title: | Senior Vice President | |||
| S-2 | Ninth Amendment to Third A&R RPA (Arch Coal) |
| REGIONS BANK, as a Purchaser Agent | ||
| By: | /s/ Mimi Bulow | |
| Name: | Mimi Bulow | |
| Title: | Assistant Vice President | |
| REGIONS BANK, as a Related Committed Purchaser | ||
| By: | /s/ Mimi Bulow | |
| Name: | Mimi Bulow | |
| Title: | Assistant Vice President | |
| REGIONS BANK, as an LC Participant | ||
| By: | /s/ Mimi Bulow | |
| Name: | Mimi Bulow | |
| Title: | Assistant Vice President | |
| S-3 | Ninth Amendment to Third A&R RPA (Arch Coal) |
[EXHIBIT A]
AMENDMENTS TO RECEIVABLES PURCHASE AGREEMENT
ATTACHED
EXECUTION VERSION
EXHIBIT A to EighthNinth Amendment, dated as of February 8January 14, 20242025
THIRD AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT
DATED AS OF OCTOBER 5, 2016
BY AND AMONG
ARCH RECEIVABLE COMPANY, LLC,
as Seller,
ARCH COAL SALES COMPANY, INC.,
as initial Servicer,
THE VARIOUS CONDUIT PURCHASERS, RELATED COMMITTED PURCHASERS, LC PARTICIPANTS AND PURCHASER AGENTS FROM TIME TO TIME PARTY HERETO,
AND
PNC BANK, NATIONAL ASSOCIATION,
as Administrator and as LC Bank
TABLE OF CONTENTS
| Page | ||||||
| ARTICLE I. | AMOUNTS AND TERMS OF THE PURCHASES |
2 | ||||
| Section 1.1 |
Purchase Facility |
2 | ||||
| Section 1.2 |
Making Purchases; Assignment and Assumption |
3 | ||||
| Section 1.3 |
Purchased Interest Computation |
6 | ||||
| Section 1.4 |
Settlement Procedures |
6 | ||||
| Section 1.5 |
Fees |
12 | ||||
| Section 1.6 |
Payments and Computations, Etc |
12 | ||||
| Section 1.7 |
Increased Costs |
13 | ||||
| Section 1.8 |
Requirements of Law; Funding Losses |
14 | ||||
| Section 1.9 |
Daily 1M SOFR or Term SOFR Rate Unascertainable; Increased Costs; Illegality |
|||||
| Section 1.10 |
Taxes |
17 | ||||
| Section 1.11 |
Letters of Credit |
17 | ||||
| Section 1.12 |
Issuance of Letters of Credit |
17 | ||||
| Section 1.13 |
Requirements For Issuance of Letters of Credit |
18 | ||||
| Section 1.14 |
Disbursements, Reimbursement |
18 | ||||
| Section 1.15 |
Repayment of Participation Advances |
19 | ||||
| Section 1.16 |
Documentation |
20 | ||||
| Section 1.17 |
Determination to Honor Drawing Request |
20 | ||||
| Section 1.18 |
Nature of Participation and Reimbursement Obligations |
|||||
| Section 1.19 |
Indemnity |
22 | ||||
| Section 1.20 |
Liability for Acts and Omissions |
|||||
| Section 1.21 |
Benchmark Replacement Setting |
24 | ||||
| Section 1.22 |
Conforming Changes Relating to Daily 1M SOFR and the Term SOFR Rate |
28 | ||||
|
Section 1.23 |
Selection of Daily 1M SOFR and Term SOFR Rate; Rate Quotations |
28 | ||||
| ARTICLE II. | REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION EVENTS |
29 | ||||
| Section 2.1 |
Representations and Warranties; Covenants |
29 | ||||
| Section 2.2 |
Termination Events |
29 | ||||
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TABLE OF CONTENTS
(continued)
| Page | ||||||
| ARTICLE III. | INDEMNIFICATION |
29 | ||||
| Section 3.1 |
Indemnities by the Seller |
29 | ||||
| Section 3.2 |
Indemnities by the Servicer |
32 | ||||
| ARTICLE IV. | ADMINISTRATION, COLLECTIONS AND INSURANCE RECEIVABLES |
32 | ||||
| Section 4.1 |
Appointment of the Servicer |
32 | ||||
| Section 4.2 |
Duties of the Servicer |
33 | ||||
| Section 4.3 |
Lock-Box Account and LC Collateral Account Arrangements |
34 | ||||
| Section 4.4 |
Enforcement Rights |
35 | ||||
| Section 4.5 |
Responsibilities of the Seller |
36 | ||||
| Section 4.6 |
Servicing Fee |
36 | ||||
| Section 4.7 |
Authorization and Action of the Administrator and Purchaser Agents |
37 | ||||
| Section 4.8 |
Nature of Administrator’s Duties; Delegation of Administrator’s Duties; Exculpatory Duties |
38 | ||||
| Section 4.9 |
UCC Filings |
39 | ||||
| Section 4.10 |
Agent’s Reliance, Etc |
39 | ||||
| Section 4.11 |
Administrator and Affiliates |
40 | ||||
| Section 4.12 |
Notice of Termination Events |
40 | ||||
| Section 4.13 |
Non-Reliance on Administrator, Purchaser Agents and other Purchasers; Administrators and Affiliates |
41 | ||||
| Section 4.14 |
Indemnification |
42 | ||||
| Section 4.15 |
Successor Administrator |
42 | ||||
| Section 4.16 |
Credit Insurance Policies |
43 | ||||
| ARTICLE V. | MISCELLANEOUS |
45 | ||||
| Section 5.1 |
Amendments, Etc |
45 | ||||
| Section 5.2 |
Notices, Etc |
45 | ||||
| Section 5.3 |
Successors and Assigns; Assignability; Participations |
46 | ||||
| Section 5.4 |
Costs, Expenses and Taxes |
49 | ||||
| Section 5.5 |
No Proceedings; Limitation on Payments |
50 | ||||
| Section 5.6 |
Confidentiality |
51 | ||||
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TABLE OF CONTENTS
(continued)
| Page | ||||||
| Section 5.7 |
GOVERNING LAW AND JURISDICTION |
|||||
| Section 5.8 |
Execution in Counterparts |
52 | ||||
| Section 5.9 |
Survival of Termination; Non-Waiver |
52 | ||||
| Section 5.10 |
WAIVER OF JURY TRIAL |
52 | ||||
| Section 5.11 |
Entire Agreement |
53 | ||||
| Section 5.12 |
Headings |
53 | ||||
| Section 5.13 |
Right of Setoff |
53 | ||||
| Section 5.14 |
Purchaser Groups’ Liabilities |
53 | ||||
| Section 5.15 |
Sharing of Recoveries |
|||||
| Section 5.16 |
USA Patriot Act |
54 | ||||
| Section 5.17 |
Tax Matters |
54 | ||||
| Section 5.18 |
Severability |
|||||
| Section 5.19 |
Mutual Negotiations |
55 | ||||
-iii-
TABLE OF CONTENTS
| Page | ||||||
| EXHIBIT I | DEFINITIONS |
|||||
| EXHIBIT II | CONDITIONS PRECEDENT |
|||||
| EXHIBIT III | REPRESENTATIONS AND WARRANTIES |
|||||
| EXHIBIT IV | COVENANTS |
|||||
| EXHIBIT V | TERMINATION EVENTS |
|||||
| SCHEDULE I | CREDIT AND COLLECTION POLICY |
|||||
| SCHEDULE II | LOCK-BOX BANK, BLOCKED ACCOUNT AND LOCK-BOX ACCOUNT |
|||||
| SCHEDULE III | ACTIONS AND PROCEEDINGS |
|||||
| SCHEDULE IV | GROUP COMMITMENTS |
|||||
| ANNEX A | FORM OF INFORMATION PACKAGE |
|||||
| ANNEX B-1 | FORM OF PURCHASE NOTICE |
|||||
| ANNEX B-2 | FORM OF ISSUANCE NOTICE |
|||||
| ANNEX C | FORM OF PAYDOWN NOTICE |
|||||
| ANNEX D | FORM OF COMPLIANCE CERTIFICATE |
|||||
| ANNEX E | FORM OF LETTER OF CREDIT APPLICATION |
|||||
| ANNEX F | FORM OF ASSUMPTION AGREEMENT |
|||||
| ANNEX G | FORM OF TRANSFER SUPPLEMENT |
|||||
| ANNEX H-1 | FORM OF WEEKLY REPORT |
|||||
| ANNEX H-2 | FORM OF DAILY REPORT |
|||||
| ANNEX I | [RESERVED] |
|||||
| ANNEX J | FORM OF CASH FLOW FORECAST |
|||||
-i-
This THIRD AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time, this “Agreement”) is entered into as of October 5, 2016, by and among ARCH RECEIVABLE COMPANY, LLC, a Delaware limited liability company, as seller (the “Seller”), ARCH COAL SALES COMPANY, INC., a Delaware corporation (“Arch Sales”), as initial servicer (in such capacity, together with its successors and permitted assigns in such capacity, the “Servicer”), the various CONDUIT PURCHASERS, RELATED COMMITTED PURCHASERS, LC PARTICIPANTS and PURCHASER AGENTS from time to time party hereto and PNC BANK, NATIONAL ASSOCIATION, a national banking association (“PNC”), as administrator (in such capacity, together with its successors and assigns in such capacity, the “Administrator”) and as issuer of Letters of Credit (in such capacity, together with its successors and assigns in such capacity, the “LC Bank”).
PRELIMINARY STATEMENTS. Certain terms that are capitalized and used throughout this Agreement are defined in Exhibit I. References in the Exhibits hereto to the “Agreement” refer to this Agreement, as amended, supplemented or otherwise modified from time to time.
This Agreement amends and restates in its entirety, as of the Closing Date, the Second Amended and Restated Receivables Purchase Agreement, dated as of January 13, 2016 (as amended, restated, supplemented or otherwise modified prior to the date hereof, the “Prior Agreement”), among each of the parties hereto. Upon the effectiveness of this Agreement, the terms and provisions of the Prior Agreement shall, subject to this paragraph, be superseded hereby in their entirety. Notwithstanding the amendment and restatement of the Prior Agreement by this Agreement, (i) the Seller and Servicer shall continue to be liable to PNC, Regions and any other Indemnified Party or Affected Person (as such terms are defined in the Prior Agreement) for fees and expenses which are accrued and unpaid under the Prior Agreement on the date hereof (collectively, the “Prior Agreement Outstanding Amounts”) and all agreements to indemnify such parties in connection with events or conditions arising or existing prior to the effective date of this Agreement and (ii) the security interest created under the Prior Agreement shall remain in full force and effect as security for such Prior Agreement Outstanding Amounts until such Prior Agreement Outstanding Amounts shall have been paid in full. Upon the effectiveness of this Agreement, each reference to the Prior Agreement in any other document, instrument or agreement shall mean and be a reference to this Agreement. Nothing contained herein, unless expressly herein stated to the contrary, is intended to amend, modify or otherwise affect any other instrument, document or agreement executed and/or delivered in connection with the Prior Agreement.
The Seller (i) desires to sell, transfer and assign an undivided percentage interest in a pool of receivables, and the Purchasers desire to acquire such undivided percentage interest, as such percentage interest shall be adjusted from time to time based upon, in part, reinvestment payments that are made by such Purchasers and (ii) may, subject to the terms and conditions hereof, request that the LC Bank issue or cause the issuance of one or more Letters of Credit.
In consideration of the mutual agreements, provisions and covenants contained herein, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1 Purchase Facility.
(a) On the terms and subject to the conditions hereof, the Seller may, from time to time before the Facility Termination Date, (i) ratably (based on the aggregate Commitments of the Related Committed Purchasers in their respective Purchaser Groups) request that the Conduit Purchasers, or, only if a Conduit Purchaser denies such request or is unable to fund, ratably request that the Related Committed Purchasers, make purchases of and reinvestments in undivided percentage ownership interests with regard to the Purchased Interest from the Seller pursuant to Section 1.1(b) and (ii) request that the LC Bank issue or cause the issuance of Letters of Credit, in each case subject to the terms hereof (each such purchase, reinvestment or issuance is referred to herein as a “Purchase”). Subject to Section 1.4(b) concerning reinvestments, at no time will a Conduit Purchaser have any obligation to make a Purchase. Each Related Committed Purchaser severally hereby agrees, on the terms and subject to the conditions hereof, to make purchases of and reinvestments in undivided percentage ownership interests with regard to the Purchased Interest from the Seller from time to time from the date hereof to the Facility Termination Date, based on the applicable Purchaser Group’s Ratable Share of each Purchase (and, in the case of each Related Committed Purchaser, its Commitment Percentage of its Purchaser Group’s Ratable Share of such Purchase) and, on the terms of and subject to the conditions of this Agreement, the LC Bank hereby agrees to issue Letters of Credit in return for (and each LC Participant hereby severally agrees to make participation advances in connection with any draws under such Letters of Credit equal to such LC Participant’s Pro Rata Share of such draws), undivided percentage ownership interests with regard to the Purchased Interest from the Seller from time to time from the date hereof to the Facility Termination Date. Notwithstanding anything set forth in this paragraph (a) or otherwise herein to the contrary, under no circumstances shall any Purchaser make any purchase or reinvestment (including, without limitation, any mandatory deemed Purchases pursuant to Section 1.1(b)) or issue any Letters of Credit hereunder, as applicable, if, after giving effect to such Purchase, the (i) aggregate outstanding amount of the Capital funded by such Purchaser, when added to all other Capital funded by all other Purchasers in such Purchaser’s Purchaser Group would exceed (A) its Purchaser Group’s Group Commitment (as the same may be reduced from time to time pursuant to Section 1.1(c)) minus (B) the related LC Participant’s Pro Rata Share of the LC Participation Amount, (ii) the Aggregate Capital plus the LC Participation Amount would exceed the Purchase Limit or (iii) the LC Participation Amount would exceed the aggregate of the Commitments of the LC Participants.
The Seller may, subject to this paragraph (a) and the other requirements and conditions herein, use the proceeds of any purchase by the Purchasers hereunder to satisfy its Reimbursement Obligation to the LC Bank and the LC Participants (ratably, based on the outstanding amounts funded by the LC Bank and each such LC Participant) pursuant to Section 1.14 below.
Each of the parties hereto hereby acknowledges and agrees that from and after the Closing Date, the Purchaser Groups that includes PNC and Regions, as a Purchaser Agent and as a Purchaser, shall not include a Conduit Purchaser, and each request by the Seller for ratable Purchases by the Conduit Purchasers pursuant to Section 1.1(a)(i) shall be deemed to be a request that the Related Committed Purchasers in PNC’s and Regions’ Purchaser Group make their ratable share of such Purchases.
2
(b) In the event the Seller fails to reimburse the LC Bank for the full amount of any drawing under any Letter of Credit on the applicable Drawing Date (out of its own funds available therefor) pursuant to Section 1.14, then the Seller shall, automatically (and without the requirement of any further action on the part of any Person hereunder), be deemed to have requested a new purchase from the Conduit Purchasers or Related Committed Purchasers, as applicable, on such date, on the terms and subject to the conditions hereof, in an amount equal to the amount of such Reimbursement Obligation at such time. Subject to the limitations on funding set forth in paragraph (a) above (and the other requirements and conditions herein), the Conduit Purchasers or Related Committed Purchasers, as applicable, shall fund such deemed purchase request and deliver the proceeds thereof directly to the Administrator to be immediately distributed (ratably) to the LC Bank and the applicable LC Participants in satisfaction of the Seller’s Reimbursement Obligation pursuant to Section 1.14, below, to the extent of the amounts permitted to be funded by the Conduit Purchasers or Related Committed Purchasers, as applicable, at such time, hereunder.
(c) The Seller may, upon at least 15 days’ written notice to the Administrator, terminate the Purchase Facility in whole or, upon at least 15 days’ written notice to the Administrator, from time to time, irrevocably reduce in part the unused portion of the Purchase Limit (but not below the amount that would cause the Aggregate Capital plus the LC Participation Amount to exceed the Purchase Limit or would cause the Group Capital of any Purchaser Group to exceed its Group Commitment, in each case after giving effect to such reduction); provided, that each partial reduction shall be in the amount of at least $5,000,000, or an integral multiple of $1,000,000 in excess thereof, and that, unless terminated in whole, the Purchase Limit shall in no event be reduced below $50,000,000. Each reduction in the Commitments hereunder shall be made ratably among the Purchasers in accordance with their respective Commitment Percentages and their respective Commitments. The Administrator shall promptly advise the Purchaser Agents of any notice received by it pursuant to this Section 1.1(c); it being understood that (in addition to and without limiting any other requirements for termination, prepayment and/or the funding of the LC Collateral Account hereunder) no such termination or reduction shall be effective unless and until (i) in the case of a termination, the amount on deposit in the LC Collateral Account is at least equal to the then outstanding LC Participation Amount and (ii) in the case of a partial reduction, the amount on deposit in the LC Collateral Account is at least equal to the positive difference between the then outstanding LC Participation Amount and the Purchase Limit as so reduced by such partial reduction.
Section 1.2 Making Purchases; Assignment and Assumption.
(a) Each Funded Purchase (but not reinvestment) of undivided percentage ownership interests with regard to the Purchased Interest hereunder may be made on any day upon the Seller’s irrevocable written notice in the form of Annex B-1 (each, a “Purchase Notice”) delivered to the Administrator and each Purchaser Agent in accordance with Section 5.2 (which notice must be received by the Administrator and each Purchaser Agent before 11:00 a.m., New York City time) at least two Business Days before the requested Purchase Date, which notice shall specify: (A) solely in the case of a Funded Purchase maintained by Capital (other than one made pursuant
3
to Section 1.14(b)), the amount requested to be paid to the Seller (such amount, which shall not be less than $300,000 (or such lesser amount as agreed to by the Administrator and each Purchaser Agent) and shall be in integral multiples of $100,000 in excess thereof, being the Capital relating to the undivided percentage ownership interest then being purchased with respect to each Purchaser Group), (B) the date of such Funded Purchase (which shall be a Business Day), and (C) the pro forma calculation of the Purchased Interest after giving effect to the increase in the Aggregate Capital.
(b) Subject to the following paragraphs of this Section 1.2(b), on the date of each Funded Purchase (but not reinvestment, issuance of a Letter of Credit or a Funded Purchase pursuant to Section 1.2(e)) of undivided percentage ownership interests with regard to the Purchased Interest hereunder, each applicable Conduit Purchaser or Related Committed Purchaser, as the case may be, shall, upon satisfaction of the applicable conditions set forth in Exhibit II, make available to the Seller in same day funds, at such account as may from time to time be designated in writing by the Seller to the Administrator and each Purchaser Agent), an amount equal to the portion of Capital relating to the undivided percentage ownership interest then being purchased by such Purchaser.
(c) Effective on the date of each Funded Purchase or other Purchase pursuant to this Section 1.2 and each reinvestment pursuant to Section 1.4, other than as provided under Section 5.17(a), the Seller hereby sells and assigns to the Administrator for the benefit of the Purchasers (ratably, based on the sum of the Capital plus the LC Participation Amount outstanding at such time for each such Purchaser’s Capital) an undivided percentage ownership interest in: (i) each Pool Receivable then existing, (ii) all Related Security with respect to such Pool Receivables, and (iii) all Collections with respect to, and other proceeds of, such Pool Receivables and Related Security.
(d) To secure all of the Seller’s obligations (monetary or otherwise) under this Agreement and the other Transaction Documents to which it is a party, whether now or hereafter existing or arising, due or to become due, direct or indirect, absolute or contingent, the Seller hereby grants to the Administrator (for the benefit of the Secured Parties) a security interest in all of the Seller’s right, title and interest (including any undivided interest of the Seller) in, to and under all of the following, whether now or hereafter owned, existing or arising: (i) all Pool Receivables, (ii) all Related Security with respect to such Pool Receivables, (iii) all Collections with respect to such Pool Receivables, (iv) the Lock-Box Accounts and all amounts on deposit therein, and all certificates and instruments, if any, from time to time evidencing such Lock-Box Accounts and amounts on deposit therein, (v) the LC Collateral Account and all amounts on deposit therein, and all certificates and instruments, if any, from time to time evidencing such LC Collateral Account and amounts on deposit therein, (vi) all rights (but none of the obligations) of the Seller under the Sale Agreements, (vii) all proceeds of, and all amounts received or receivable under any or all of, the foregoing (other than Seller’s Permitted Payments) and (viii) all of its other property (collectively, the “Pool Assets”). For the avoidance of doubt, Seller’s Permitted Payments when made shall be automatically excluded and released from the Pool Assets. The Seller hereby authorizes the Administrator to file financing statements describing the collateral covered thereby as “all of the debtor’s personal property or assets” or words to that effect, notwithstanding that such wording may be broader in scope than the collateral described in this
4
Agreement. The Administrator (on behalf of the Secured Parties) shall have, with respect to the Pool Assets, and in addition to all the other rights and remedies available to the Administrator and the Purchasers, all the rights and remedies of a secured party under any applicable UCC. The Seller hereby acknowledges and agrees that pursuant to the Prior Agreement, the Seller granted to the Administrator a security interest in all of the Seller’s right, title and interest in, to and under the Pool Assets (as defined in the Prior Agreement). The Seller hereby confirms such security interest and acknowledges and agrees that such security interest is continuing and is supplemented and restated by the security interest granted by the Seller pursuant to this Section 1.2(d).
(e) Whenever the LC Bank issues a Letter of Credit pursuant to Section 1.12 hereof, each LC Participant shall, automatically and without further action of any kind upon the effective date of issuance of such Letter of Credit, have irrevocably been deemed to make a Funded Purchase hereunder in the event that such Letter of Credit is subsequently drawn and such drawn amount shall not have been reimbursed pursuant to Section 1.14 upon such draw in an amount equal to its Pro Rata Share of such unreimbursed draw. All such Funded Purchases shall be made ratably by the LC Participants according to their Pro Rata Shares and shall accrue Discount from the date of such draw. In the event that any Letter of Credit expires or is surrendered without being drawn (in whole or in part) then, in such event, the foregoing commitment to make Funded Purchases shall expire with respect to such Letter of Credit and the LC Participation Amount shall automatically reduce by the amount of the Letter of Credit which is no longer outstanding.
(f) The Seller may, with the prior written consent of the Administrator and each Purchaser Agent (and, in the case of a new related LC Participant, the LC Bank), which consent may be granted or withheld in their sole and absolute discretion, add additional Persons as Purchasers (either to an existing Purchaser Group or by creating new Purchaser Groups) or cause an existing Related Committed Purchaser or related LC Participant to increase its Commitment; provided, that the Commitment of any Related Committed Purchaser or related LC Participant may only be increased with the prior written consent of such Purchaser; provided, further, that neither the Commitment of any new Purchaser Group nor the aggregate increase in the Commitment of existing Related Committed Purchasers shall exceed $50,000,000 and in connection with any such increase or addition shall be a corresponding increase in the Purchase Limit. Each new Conduit Purchaser, Related Committed Purchaser or related LC Participant (or Purchaser Group) shall become a party hereto, by executing and delivering to the Administrator, each Purchaser Agent and the Seller, an Assumption Agreement in the form of Annex F hereto (which Assumption Agreement shall, in the case of any new Conduit Purchaser, Related Committed Purchaser or related LC Participant, be executed by each Person in such new Purchaser’s Purchaser Group).
(g) Each Related Committed Purchaser’s and related LC Participant’s obligations hereunder shall be several, such that the failure of any Related Committed Purchaser or related LC Participant to make a payment in connection with any purchase hereunder, or drawing under a Letter of Credit hereunder, as the case may be, shall not relieve any other Related Committed Purchaser or related LC Participant of its obligation hereunder to make payment for any Funded Purchase or such drawing. Further, in the event any Related Committed Purchaser or related LC Participant fails to satisfy its obligation to make a purchase or payment with respect to such drawing as required hereunder, upon receipt of notice of such failure from the Administrator (or
5
any relevant Purchaser Agent), subject to the limitations set forth herein, the non-defaulting Related Committed Purchasers or related LC Participants in such defaulting Related Committed Purchaser’s or related LC Participant’s Purchaser Group shall fund the defaulting Related Committed Purchaser’s or related LC Participant’s Commitment Percentage of the related Purchase or drawing pro rata in proportion to their relative Commitment Percentages (determined without regard to the Commitment Percentage of the defaulting Related Committed Purchaser or related LC Participant; it being understood that a defaulting Related Committed Purchaser’s or related LC Participant’s Commitment Percentage of any Purchase or drawing shall be first funded by the Related Committed Purchasers or related LC Participants in such defaulting Related Committed Purchaser’s or related LC Participant’s Purchaser Group and thereafter if there are no other Related Committed Purchasers or related LC Participants in such Purchaser Group or if such other Related Committed Purchasers or related LC Participants are also defaulting Related Committed Purchasers or related LC Participants, then such defaulting Related Committed Purchaser’s or related LC Participant’s Commitment Percentage of such Purchase or drawing shall be funded by each other Purchaser Group ratably and applied in accordance with this paragraph (g)). Notwithstanding anything in this paragraph (g) to the contrary and for the avoidance of doubt, each Related Committed Purchaser’s and LC Participant’s obligation to make a Purchase or payment with respect to any drawing shall be subject in all respects to the limitations set forth in the last sentence of the first paragraph of Section 1.1(a).
Section 1.3 Purchased Interest Computation. The Purchased Interest shall be initially computed on the Closing Date. Thereafter, until the Facility Termination Date, such Purchased Interest shall be automatically recomputed (or deemed to be recomputed) on each Business Day other than a Termination Day. From and after the occurrence of any Termination Day, the Purchased Interest shall (until the event(s) giving rise to such Termination Day are satisfied or are waived by the Administrator in accordance with Section 5.1) be deemed to be 100%. The Purchased Interest shall become zero when (a) the Aggregate Capital thereof and Aggregate Discount thereon shall have been paid in full, (b) an amount equal to 100% of the LC Participation Amount and the LC Fee Expectation shall have been deposited in the LC Collateral Account, or all Letters of Credit shall have expired or otherwise been terminated and (c) all the amounts owed by the Seller and the Servicer hereunder to each Purchaser, the Administrator and any other Indemnified Party or Affected Person are paid in full (other than indemnification and other contingent obligations not yet due and owing), and the Servicer shall have received the accrued Servicing Fee thereon.
Section 1.4 Settlement Procedures.
(a) The collection of the Pool Receivables shall be administered by the Servicer in accordance with this Agreement. The Seller shall provide to the Servicer on a timely basis all information needed for such administration, including notice of the occurrence of any Termination Day and current computations of the Purchased Interest.
6
(b) The Servicer shall, on each day on which Collections of Pool Receivables are received (or deemed received) by the Seller or the Servicer in accordance with this Agreement, including Section 1.4(g):
(i) set aside and hold in trust (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator) for the benefit of the Secured Parties, out of such Collections, first, an amount equal to the Aggregate Discount accrued through such day for each Portion of Capital and not previously set aside, second, an amount equal to the fees set forth in each Fee Letter accrued and unpaid through such day, and third, to the extent funds are available therefor, an amount equal to the aggregate of the Purchasers’ Share of the Servicing Fee accrued through such day and not previously set aside;
(ii) subject to Section 1.4(f), if such day is not a Termination Day, remit to the Seller, ratably, on behalf of the Purchasers, the remainder of such Collections. Such remainder shall, to the extent representing a return on the Aggregate Capital, be automatically reinvested, ratably, according to each Purchaser’s Capital, in Pool Receivables and in the Related Security, Collections and other proceeds with respect thereto; provided, that if the Purchased Interest would exceed 100%, then the Servicer shall not remit such remainder to the Seller or reinvest, but shall set aside and hold in trust for the Administrator (for the benefit of the Secured Parties) (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator) a portion of such Collections that, together with the other Collections set aside pursuant to this paragraph, shall equal the amount necessary to reduce the Purchased Interest to 100% (determined as if such Collections set aside had been applied to reduce the Aggregate Capital or LC Participation Amount, as applicable, at such time), which amount shall either (x) be deposited ratably to each Purchaser Agent’s account (for the benefit of its related Purchasers) or (y) be deposited in the LC Collateral Account, in each case, as applicable, on the next Settlement Date in accordance with Section 1.4(c); provided, further, that (x) in the case of any Purchaser that is a Conduit Purchaser, if such Purchaser has provided notice (a “Declining Notice”) to its Purchaser Agent and the Administrator that such Purchaser (a “Declining Conduit Purchaser”) no longer wishes Collections with respect to any Portion of Capital funded or maintained by such Purchaser to be reinvested pursuant to this clause (ii) or (y) in the case of any Purchaser that has provided notice (an “Exiting Notice”) to its Purchaser Agent and the Administrator of its refusal, following any request by the Seller to extend the then Facility Termination Date, to extend its Commitment hereunder (an “Exiting Purchaser”), then in either case set forth in clause (x) or (y) above, such Purchaser’s ratable share (determined according to outstanding Capital) of Collections shall not be reinvested or remitted to the Seller and shall instead be held in trust for the benefit of such Purchaser and applied in accordance with clause (iii) below;
(iii) if such day is a Termination Day (or any day following the provision of a Declining Notice or an Exiting Notice), set aside, segregate and hold in trust for the benefit of the Purchasers (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator), the entire remainder of such Collections (or in the case of a Declining Conduit Purchaser or an Exiting Purchaser, an amount equal to such Purchaser’s ratable share of such Collections based on its Capital; provided, that solely for purposes of determining such Purchaser’s ratable share of such Collections, such Purchaser’s Capital shall be deemed to remain constant from the date of the provision of a Declining Notice or an Exiting Notice, as the case may be, until the date such Purchaser’s
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Capital has been paid in full; it being understood that if such day is also a Termination Day, such Declining Conduit Purchaser’s or Exiting Purchaser’s Capital shall be recalculated taking into account amounts received by such Purchasers in respect of this parenthetical and thereafter Collections shall be set aside for such Purchaser ratably in respect of its Capital (as recalculated)); provided, further, that if amounts are set aside and held in trust on any Termination Day of the type described in clause (a) of the definition of “Termination Day” (or any day following the provision of a Declining Notice or an Exiting Notice) and, thereafter, the conditions set forth in Section 2 of Exhibit II are satisfied or waived by the Administrator and the Majority Purchaser Agents (or, in the case of a Declining Notice or an Exiting Notice, such Declining Notice or Exiting Notice, as the case may be, has been revoked by the related Declining Conduit Purchaser or Exiting Purchaser, respectively, and written notice thereof has been provided to the Administrator, the related Purchaser Agent and the Servicer), such previously set-aside amounts shall, to the extent representing a return on the Aggregate Capital (or the Capital of the Declining Conduit Purchaser or Exiting Purchaser, as the case may be) and ratably in accordance with each Purchaser’s Capital, be reinvested in accordance with clause (ii) on the day of such subsequent satisfaction or waiver of conditions or revocation of Declining Notice or Exiting Notice, as the case may be; and
(iv) release to the Seller (subject to Section 1.4(f)) for its own account any Collections in excess of: (w) amounts required to be reinvested in accordance with clause (ii) or the proviso to clause (iii) plus (x) the amounts that are required to be set aside pursuant to clause (i), the provisos to clause (ii) and clause (iii) plus (y) the Seller’s Share of the Servicing Fee accrued and unpaid through such day and all reasonable and appropriate out-of-pocket costs and expenses of the Servicer for servicing, collecting and administering the Pool Receivables plus (z) all other amounts then due and payable by the Seller under this Agreement to the Purchasers, the Purchaser Agents, the Administrator, and any other Indemnified Party or Affected Person.
(c) The Servicer shall, in accordance with the priorities set forth in Section 1.4(d), deposit into each Purchaser Agent’s account, on each Settlement Date, Collections held for such Purchaser Agent (for the benefit of its related Purchasers) pursuant to clause (b)(i) or (f) plus the amount of Collections then held for such Purchaser Agent (for the benefit of its related Purchasers) pursuant to clauses (b)(ii) and (iii) of Section 1.4; provided, that if Arch Sales or an Affiliate thereof is the Servicer, such day is not a Termination Day and the Administrator has not notified Arch Sales (or such Affiliate) that such right is revoked, Arch Sales (or such Affiliate) may retain the portion of the Collections set aside pursuant to clause (b)(i) that represents the aggregate of each Purchasers’ Share of the Servicing Fee. On or prior to the last day of each Settlement Period, each Purchaser Agent will notify the Servicer by facsimile of the amount of Discount accrued with respect to each Portion of Capital during such Settlement Period or portion thereof.
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(d) The Servicer shall distribute the amounts described (and at the times set forth) in clause (c) above as follows:
(i) if such distribution occurs on a day that is not a Termination Day and the Purchased Interest does not exceed 100%, first to each Purchaser Agent ratably according to the Discount accrued during such Settlement Period (for the benefit of the relevant Purchasers within such Purchaser Agent’s Purchaser Group) in payment in full of all accrued Discount with respect to each Portion of Capital maintained by such Purchasers and all accrued Fees; it being understood that each Purchaser Agent shall distribute such amounts to the Purchasers within such Purchaser Agent’s Purchaser Group ratably according to Discount and Fees, respectively, and second, if the Servicer has set aside amounts in respect of the Servicing Fee pursuant to clause (b)(i) and has not retained such amounts pursuant to clause (c), to the Servicer (payable in arrears on each Settlement Date) in payment in full of the aggregate of the Purchasers’ Share of accrued Servicing Fees so set aside, and
(ii) if such distribution occurs on a Termination Day or on a day when the Purchased Interest exceeds 100%, first, if Arch Sales or an Affiliate thereof is not the Servicer, to the Servicer in payment in full of the Purchasers’ Share of all accrued Servicing Fees, second, to each Purchaser Agent ratably (based on the aggregate accrued and unpaid Discount and Fees payable to all Purchasers at such time) (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) in payment in full of all accrued Discount with respect to each Portion of Capital funded or maintained by the Purchasers within such Purchaser Agent’s Purchaser Group and all accrued Fees, third, to each Purchaser Agent ratably according to the aggregate of the Capital of each Purchaser in each such Purchaser Agent’s Purchaser Group (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) in payment in full of each Purchaser’s Capital (or, if such day is not a Termination Day, the amount necessary to reduce the Purchased Interest to 100%) (determined as if such Collections had been applied to reduce the Aggregate Capital); it being understood that each Purchaser Agent shall distribute the amounts described in the first, second and third clauses of this Section 1.4(d)(ii) to the Purchasers within such Purchaser Agent’s Purchaser Group ratably according to Discount, Fees and Capital, respectively, fourth, to the LC Collateral Account for the benefit of the LC Bank and the LC Participants (x) the amount necessary to cash collateralize the LC Participation Amount until the amount of cash collateral held in such LC Collateral Account (other than amount representing LC Fee Expectation) equals 100% of the LC Participation Amount (or, if such day is not a Termination Day, the amount necessary to reduce the Purchased Interest to 100%) (determined as if such Collections had been applied to reduce the aggregate outstanding amount of the LC Participation Amount) and (y) if such day is a Termination Day of the type described in clause (b) of the definition thereof or a Termination Event is continuing, an amount equal to the LC Fee Expectation at such time (or such portion thereof not currently on deposit in the LC Collateral Account), fifth, if the Aggregate Capital and accrued Aggregate Discount with respect to each Portion of Capital for all Purchaser Groups have been reduced to zero, and the aggregate of the Purchasers’ Share of all accrued Servicing Fees payable to the Servicer (if other than Arch Sales or an Affiliate thereof) have been paid in full, to each Purchaser Agent ratably, based on the amounts payable to each Purchaser in such Purchaser Agent’s Purchaser Group (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group), the Administrator and any other Secured Party in payment in full of any other amounts owed thereto by the Seller or the Servicer hereunder, and sixth, to the Servicer (if the Servicer is Arch Sales or an Affiliate thereof) in payment in full of the aggregate of the Purchasers’ Share of all accrued Servicing Fees.
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After the Aggregate Capital, Aggregate Discount, fees payable pursuant to the Fee Letters and Servicing Fees with respect to the Purchased Interest, and any other amounts payable by the Seller and the Servicer to each Purchaser Group, the Administrator or any other Indemnified Party or Affected Person hereunder, have been paid in full, and (on and after a Termination Day) after an amount equal to 100% of the LC Participation Amount and the LC Fee Expectation has been deposited in the LC Collateral Account, all additional Collections with respect to the Purchased Interest shall be paid to the Seller for its own account.
(e) For the purposes of this Section 1.4:
(i) if on any day the Outstanding Balance of any Pool Receivable is reduced or adjusted as a result of any defective, rejected, returned, repossessed or foreclosed goods or services, or any revision, cancellation, allowance, rebate, discount or other adjustment made by the Seller, any Affiliate of the Seller, any Originator, the Transferor, the Servicer or any Affiliate of the Servicer, or any setoff, netting of obligations or dispute between the Seller, any Affiliate of the Seller, any Originator, the Transferor, the Servicer or any Affiliate of the Servicer and an Obligor, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in the amount of such reduction or adjustment and shall immediately pay any and all such amounts in respect thereof to a Lock-Box Account for the benefit of the Secured Parties pursuant to Section 1.4;
(ii) if on any day any of the representations or warranties in Sections l(j) or 3(a) of Exhibit III is not true with respect to any Pool Receivable, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in full and shall immediately pay any and all such amounts in respect thereof to a Lock-Box Account (or as otherwise directed by the Administrator at such time) for the benefit of the Secured Parties and for application pursuant to Section 1.4;
(iii) except as provided in clause (i) or (ii), or as otherwise required by Applicable Law or the relevant Contract, all Collections of any Receivable shall be applied to the Receivables of the applicable Obligor in the order of the age of such Receivables, starting with the oldest such Receivable, unless such Obligor designates in writing its payment for application to specific Receivables; and
(iv) if and to the extent the Administrator, any Purchaser Agent or any Purchaser shall be required for any reason to pay over to an Obligor (or any trustee, receiver, custodian or similar official in any Insolvency Proceeding) any amount received by it hereunder, such amount shall be deemed not to have been so received by such Person but rather to have been retained by the Seller and, accordingly, such Person shall have a claim against the Seller for such amount, payable when and to the extent that any distribution from or on behalf of such Obligor is made in respect thereof.
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(f) If at any time the Seller shall wish to cause the reduction of Aggregate Capital (but not to commence the liquidation, or reduction to zero, of the entire Aggregate Capital), the Seller may do so as follows:
(i) the Seller shall give the Administrator, each Purchaser Agent and the Servicer written notice in substantially the form of Annex C (each, a “Paydown Notice”) (A) at least two Business Days prior to the date of such reduction for any reduction of the Aggregate Capital less than or equal to $20,000,000 and (B) at least five Business Days prior to the date of such reduction for any reduction of the Aggregate Capital greater than $20,000,000, in each case such Paydown Notice shall include, among other things, the amount of such proposed reduction and the proposed date on which such reduction will commence;
(ii) (A) on the proposed date of the commencement of such reduction and on each day thereafter, the Servicer shall cause Collections not to be reinvested until the amount thereof not so reinvested shall equal the desired amount of reduction or (B) the Seller shall remit to each Purchaser Agent’s account (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group), in immediately available funds, an amount equal to the desired amount of such reduction together with accrued and unpaid Aggregate Discount, and Aggregate Discount to accrue through the next Settlement Date, with respect to such Aggregate Capital, ratably (based on such Purchaser Agent’s Purchasers’ portion of the Aggregate Capital reduced thereby and portion of the related Aggregate Discount); and
(iii) the Servicer shall hold such Collections in trust for the benefit of the Purchasers ratably (based on their respective Portions of Capital funded thereby) for payment to each such Purchaser Agent (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) on the next Settlement Date immediately following the current Settlement Period or such other date approved by the Administrator and each such Purchaser Agent, and the Aggregate Capital (together with the Capital of any related Purchaser) shall be deemed reduced in the amount to be paid to each such Purchaser Agent (on behalf of its related Purchasers) only when in fact finally so paid;
provided, that the amount of any such reduction shall be not less than $300,000 and shall be an integral multiple of $100,000 in excess thereof.
(g) The Servicer may, in its sole discretion, and shall at the direction of the Administrator or any Purchaser Agent (which direction may be given no more than once per week unless a Termination Event has occurred and is continuing), deliver an Interim Report to the Administrator on any Business Day during a Minimum Liquidity Period. Upon receipt of such Interim Report, the Administrator shall promptly review such Interim Report to determine if such Interim Report constitutes a Qualifying Interim Report. In the event that the Administrator reasonably determines that such Interim Report constitutes a Qualifying Interim Report, so long as no Termination Event or Unmatured Termination Event has occurred and is continuing and the Administrator is then exercising exclusive dominion and control over the Lock-Box Accounts, the Administrator shall promptly remit to the Servicer from the Lock-Box Accounts (or the LC
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Collateral Account, if applicable) the lesser of (i) the amount identified on such Qualifying Interim Report as Collections on deposit in the Lock-Box Accounts and/or LC Collateral Account in excess of the amount necessary to ensure that the Purchased Interest does not exceed 100% and (ii) the aggregate amount of available Collections then on deposit in the Lock-Box Accounts and the LC Collateral Account. For purposes of this clause (g), “Qualifying Interim Report” shall mean any Interim Report that satisfies each of the following conditions: (A) the Purchased Interest as set forth in such Interim Report shall not exceed 100%; (B) such Interim Report is calculated as of the immediately prior Business Day and (C) the Administrator does not in good faith reasonably believe that any of the information or calculations set forth in such Interim Report are false or incorrect in any material respect (and notice of any such determination shall be provided promptly to the Servicer).
Section 1.5 Fees.
The Seller shall pay to the Administrator, the Purchaser Agents and the Purchasers certain fees in the amounts and on the dates set forth in one or more fee letter agreements for each Purchaser Group, in each case entered into from time to time by and among the Servicer, the Seller and the applicable Purchaser Agent and/or the Administrator (as any such fee letter agreement may be amended, restated, supplemented or otherwise modified from time to time, each, a “Fee Letter”).
Section 1.6 Payments and Computations, Etc.
(a) All amounts to be paid or deposited by the Seller or the Servicer hereunder or under any other Transaction Document shall be made without reduction for offset or counterclaim and shall be paid or deposited no later than 2:00 p.m. (New York City time) on the day when due in same day funds to each account designated by the Purchaser Agents (for the benefit of the Purchasers in such Purchaser Agent’s Purchaser Group) and/or the Administration Account, as applicable. All amounts received after 2:00 p.m.(New York City time) will be deemed to have been received on the next Business Day. Amounts payable hereunder to or for the benefit of the Administrator, the Purchasers or the Purchaser Agents (or their related Affected Persons or Indemnified Parties) shall be distributed as follows:
(i) Any amounts to be distributed by or on behalf of the Administrator hereunder to any Purchaser Agent, Purchaser or Purchaser Group shall be distributed to the account specified in writing from time to time by the applicable Purchaser Agent to the Administrator, and the Administrator shall have no obligation to distribute any such amounts unless and until it actually receives payment of such amounts by the Seller or the Servicer, as applicable, in the Administration Account. Except as expressly set forth herein (including, without limitation, as set forth in Section 1.4(b)(iii) with respect to Collections held in trust for Declining Conduit Purchasers and Exiting Purchasers), the Administrator shall distribute (or cause to be distributed) such amounts to the Purchaser Agents for the Purchasers within their respective Purchaser Groups ratably (x) in the case of such amounts paid in respect of Discount and Fees, according to the Discount and Fees payable to the Purchasers and (y) in the case of such amounts paid in respect of Capital (or in respect of any other obligations other than Discount and Fees), according to the outstanding Capital funded by the Purchasers.
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(ii) Except as expressly set forth herein (including, without limitation, as set forth in Section 1.4(b)(iii) with respect to Collections held in trust for Declining Conduit Purchasers and Exiting Purchasers), each Purchaser Agent shall distribute the amounts paid to it hereunder for the benefit of the Purchasers in its Purchaser Group to the Purchasers within its Purchaser Group ratably (x) in the case of such amounts paid in respect of Discount and Fees, according to the Discount and Fees payable to such Purchasers and (y) in the case of such amounts paid in respect of Capital (or in respect of any other obligations other than Discount and Fees), according to the outstanding Capital funded by such Purchasers.
(b) The Seller or the Servicer, as the case may be, shall, to the extent permitted by law, pay interest on any amount not paid or deposited by the Seller or the Servicer, as the case may be, when due hereunder, at an interest rate equal to 2.0% per annum above the Base Rate, payable on demand.
(c) All computations of interest under clause (b) and all computations of Discount, fees and other amounts hereunder shall be made on the basis of a year of 360 (or 365 or 366, as applicable, with respect to Discount or other amounts calculated by reference to the Base Rate) days for the actual number of days elapsed. Whenever any payment or deposit to be made hereunder shall be due on a day other than a Business Day, such payment or deposit shall be made on the next Business Day and such extension of time shall be included in the computation of such payment or deposit.
Section 1.7 Increased Costs.
(a) If the Administrator, any Purchaser Agent, any Purchaser, any Liquidity Provider or any other Program Support Provider or any of their respective Affiliates (each an “Affected Person”) reasonably determines that the existence of or compliance with: (i) any law, rule, regulation or generally accepted accounting principle or any change therein or in the interpretation or application thereof, or (ii) any request, guideline or directive from Financial Accounting Standards Board (“FASB”) (including, without limitation, FAS 166/167), or any central bank or other Governmental Authority (whether or not having the force of law), affects or would affect the amount of capital required or expected to be maintained by such Affected Person, and such Affected Person determines that the amount of such capital is increased by or based upon the existence of any commitment to make purchases of (or otherwise to maintain the investment in) Pool Receivables or issue any Letter of Credit related to this Agreement or any related liquidity facility, credit enhancement facility and other commitments of the same type, then, upon demand by such Affected Person (with a copy to the Administrator), the Seller shall promptly pay to the Administrator, for the account of such Affected Person, from time to time as specified by such Affected Person, additional amounts sufficient to compensate such Affected Person for increased costs in the light of such circumstances, to the extent that such Affected Person reasonably determines such increase in capital to be allocable to the existence of any of such commitments. A certificate as to such amounts submitted to the Seller and the Administrator by such Affected Person shall be conclusive and binding for all purposes, absent manifest error.
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(b) If, due to either: (i) the introduction of or any change in or in the interpretation of any law, rule, regulation or generally accepted accounting principle or (ii) compliance with any request, guideline or directive from FASB (including, without limitation, FAS 166/167) or any central bank or other Governmental Authority (whether or not having the force of law), there shall be any increase in the cost to any Affected Person of agreeing to purchase or purchasing, or maintaining the ownership of, the Purchased Interest (or its portion thereof), then, upon demand by such Affected Person, the Seller shall promptly pay to such Affected Person, from time to time as specified by such Affected Person, additional amounts sufficient to compensate such Affected Person for increased costs. A certificate as to such amounts submitted to the Seller and the Administrator by such Affected Person shall be conclusive and binding for all purposes, absent manifest error.
(c) For the avoidance of doubt, and not in limitation of the foregoing, any increase in cost and/or reduction in yield caused by regulatory capital allocation adjustments due to Statements of Financial Accounting Standards Nos. 166 and 167 (or any future statements or interpretations issued by FASB or any successor thereto) (collectively, “FAS 166/167”) shall be covered by this Section 1.7.
(d) Notwithstanding anything to the contrary, for purposes of this Section 1.7, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act, and all requests, rules, guidelines and directives promulgated thereunder and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or any Governmental Authority, any central bank of any jurisdiction, comparable agency or other Person, in each case pursuant to, or implementing, the accord known as Basel III, are, in the case of each of clause (i) and clause (ii) above, deemed to have been introduced or adopted after the date hereof, regardless of the date enacted, adopted, issued, promulgated or implemented.
Section 1.8 Requirements of Law; Funding Losses.
(I) If any Affected Person reasonably determines that the existence of or compliance with: (a) any law, rule or regulation or any change therein or in the interpretation or application thereof, or (b) any guideline, request or directive from any central bank or other Governmental Authority (whether or not having the force of law), in either case, adopted, issued or occurring after the date hereof:
(i) does or shall subject such Affected Person to any tax of any kind whatsoever with respect to this Agreement, any increase in the Purchased Interest (or its portion thereof) or in the amount of Capital relating thereto, or does or shall change the basis of taxation of payments to such Affected Person on account of Collections, Discount or any other amounts payable hereunder (excluding taxes imposed on the overall income of such Affected Person, and franchise taxes imposed on such Affected Person, by the jurisdiction under the laws of which such Affected Person is organized or a political subdivision thereof), or
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(ii) does or shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or for the account of, purchases, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Affected Person in respect to the SOFR Reserve Percentage or the Base Rate hereunder, or
(iii) does or shall impose on such Affected Person any other condition,
and the result of any of the foregoing is: (A) to increase the cost to such Affected Person of acting as Administrator, or of agreeing to purchase or purchasing or maintaining the ownership of undivided percentage ownership interests with regard to, or issuing any Letter of Credit in respect of, the Purchased Interest (or interests therein) or any Portion of Capital, or (B) to reduce any amount receivable hereunder (whether directly or indirectly), then, in any such case, upon demand by such Affected Person, the Seller shall promptly pay to such Affected Person additional amounts necessary to compensate such Affected Person for such additional cost or reduced amount receivable. All such amounts shall be payable as incurred. A certificate as to such amounts from such Affected Person to the Seller and the Administrator shall be conclusive and binding for all purposes, absent manifest error; provided, however, that notwithstanding anything to the contrary, for purposes of this Section 1.8, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act, and all requests, rules, guidelines and directives promulgated thereunder, and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or any Governmental Authority, any central bank of any jurisdiction, comparable agency or other Person, in each case pursuant to, or implementing, the accord known as Basel III, are, in the case of each of clause (i) and clause (ii) above, deemed to have been introduced or adopted after the date hereof, regardless of the date enacted, adopted, issued, promulgated or implemented.
(II) The Seller shall compensate each Affected Person, upon written request by such Person for all losses, expenses and liabilities (including any interest paid by such Affected Person to lenders of funds borrowed by it to fund or maintain any Portion of Capital hereunder and any loss sustained by such Person in connection with the re-employment of such funds), which such Affected Person may sustain with respect to funding or maintaining such Portion of Capital if, for any reason, funding or maintaining such Portion of Capital does not occur on a date specified therefor.
Section 1.9 Daily 1M SOFR or Term SOFR Rate Unascertainable; Increased Costs; Illegality.
(a) Unascertainable; Increased Costs. If, on or prior to the first day of a Settlement Period:
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(i) the Administrator shall have determined (which determination shall be conclusive and binding absent manifest error) that (x) Daily 1M SOFR or the Term SOFR Rate cannot be determined pursuant to the definition thereof; or (y) a fundamental change has occurred with respect to Daily 1M SOFR or the Term SOFR Rate (including, without limitation, changes in national or international financial, political or economic conditions); or
(ii) any Purchaser Agent determines for any reason that Daily 1M SOFR or the Term SOFR Rate for any requested Settlement Period does not adequately and fairly reflect the cost to any such Purchaser in such Purchaser Agent’s Group of funding such Purchaser’s Investments, and such Purchaser Agent has provided notice of such determination to the Administrator;
then the Administrator shall have the rights specified in Section 1.9(c).
(b) Illegality. If at any time any Purchaser Agent shall have determined that the making, maintenance or funding of any Purchase (or Portion of Capital thereof) accruing yield by reference to Daily 1M SOFR or the Term SOFR Rate has been made impracticable or unlawful, by compliance by such Purchaser Agent in good faith with any law or any interpretation or application thereof by any Governmental Authority or with any request or directive of any such Governmental Authority (whether or not having the force of law), then the Administrator shall have the rights specified in Section 1.9(c).
(c) Administrator’s and Purchaser Agent’s Rights. In the case of any event specified in Section 1.9(a), the Administrator shall promptly so notify the Purchaser Agents and the Seller thereof, and in the case of an event specified in Section 1.9(b), such Purchaser Agent shall promptly so notify the Administrator and the Administrator or such Purchase Agent, as applicable, shall endorse a certificate to such notice as to the specific circumstances of such notice, and the Administrator shall promptly send copies of such notice and certificate to the other Purchaser Agents and the Seller (or such Purchaser Agent shall promptly send a copy of such notice and certificate to the Administrator).
Upon such date as shall be specified in such notice (which shall not be earlier than the date such notice is given), the obligation of (i) the Purchaser Agents, in the case of such notice given by the Administrator, or (ii) such Purchaser Agent, in the case of such notice given by such Purchaser Agent, to allow the Seller to select, convert to or renew any Purchase (or Portion of Capital thereof) accruing yield by reference to Daily 1M SOFR or the Term SOFR Rate shall be suspended (to the extent of the affected Alternate Rate or the applicable Settlement Period) until the Administrator shall have later notified the Seller, or such Purchaser Agent shall have later notified the Administrator, of the Administrator’s or such Purchaser Agent’s, as the case may be, determination that the circumstances giving rise to such previous determination no longer exist.
If at any time the Administrator makes a determination under Section 1.9(a), (A) if the Seller has delivered a Purchase Notice for an affected Purchase (or Portion of Capital thereof) that has not yet been made, such Purchase Request shall be deemed to request a Purchase accruing yield at the Base Rate, and (B) any outstanding affected Purchases (or Portions of Capital thereof) shall be deemed to have been converted into Purchases (or Portions of Capital thereof) accruing yield at the Base Rate at the end of the applicable Settlement Period until the Administrator shall have later notified the Seller, or such Purchaser Agent shall have later notified the Administrator, of the Administrator’s or such Purchaser Agent’s, as the case may be, determination that the circumstances giving rise to such previous determination no longer exist.
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Section 1.10 Taxes.
The Seller agrees that any and all payments by the Seller under this Agreement shall be made free and clear of and without deduction for any and all current or future taxes, stamp or other taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding overall income or franchise taxes, in either case, imposed on the Person receiving such payment by the Seller hereunder by the jurisdiction under whose laws such Person is organized, operates or where its principal executive office is located or any political subdivision thereof (all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as “Taxes”). If the Seller shall be required by law to deduct any Taxes from or in respect of any sum payable hereunder to any Purchaser, Purchaser Agent, Liquidity Provider, Program Support Provider or the Administrator, then the sum payable shall be increased by the amount necessary to yield to such Person (after payment of all Taxes) an amount equal to the sum it would have received had no such deductions been made. Whenever any Taxes are payable by the Seller, the Seller agrees that, as promptly as possible thereafter, the Seller shall send to the Administrator for its own account or for the account of any Purchaser, Purchaser Agent, Liquidity Provider or other Program Support Provider, as the case may be, a certified copy of an original official receipt showing payment thereof or such other evidence of such payment as may be available to the Seller and acceptable to the taxing authorities having jurisdiction over such Person. If the Seller fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Administrator the required receipts or other required documentary evidence, the Seller shall indemnify the Administrator and/or any other Affected Person, as applicable, for any incremental taxes, interest or penalties that may become payable by such party as a result of any such failure.
Section 1.11 Letters of Credit.
Subject to the terms and conditions hereof and the satisfaction of the applicable conditions set forth in Exhibit II, the LC Bank shall issue or cause the issuance of Letters of Credit (“Letters of Credit”) on behalf of Seller (and, if applicable, on behalf of, or for the account of, the Transferor or any Subsidiary thereof) in favor of such beneficiaries as the Seller or the Transferor, as applicable may elect. All amounts drawn upon Letters of Credit shall accrue Discount. Letters of Credit that have not been drawn upon shall not accrue Discount.
Section 1.12 Issuance of Letters of Credit.
(a) The Seller may request the LC Bank, upon two (2) Business Days’ prior written notice submitted on or before 11:00 a.m., New York time, to issue a Letter of Credit by delivering to the Administrator, the LC Bank’s form of Letter of Credit Application (the “Letter of Credit Application”), substantially in the form of Annex E attached hereto and an Issuance Notice, substantially in the form of Annex B-2 (each, an “Issuance Notice”), in each case completed to the satisfaction of the Administrator and the LC Bank; and, such other certificates, documents and
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other papers and information as the Administrator may reasonably request. The Seller also has the right to give instructions and make agreements with respect to any Letter of Credit Application and the disposition of documents, and to agree with the Administrator upon any amendment, extension or renewal of any Letter of Credit.
(b) Each Letter of Credit shall, among other things, (i) provide for the payment of sight drafts or other written demands for payment when presented for honor thereunder in accordance with the terms thereof and when accompanied by the documents described therein and (ii) have an expiry date not later than twelve (12) months after such Letter of Credit’s date of issuance, extension or renewal, as the case may be, and in no event later than twelve (12) months after the Facility Termination Date. For the avoidance of doubt, no Letter of Credit may be extended or renewed to a date that is later than twelve (12) months after the Facility Termination Date. Each Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication No. 600, and any amendments or revisions thereof adhered to by the LC Bank or the International Standby Practices (ISP98-International Chamber of Commerce Publication Number 590), and any amendments or revisions thereof adhered to by the LC Bank, as determined by the LC Bank.
(c) The Administrator shall promptly notify the LC Bank and each LC Participant, at such Person’s address for notices hereunder, of the request by the Seller for a Letter of Credit hereunder, and shall provide the LC Bank and LC Participants with the Letter of Credit Application and Issuance Notice delivered to the Administrator by the Seller pursuant to paragraph (a) above, by the close of business on the day received or if received on a day that is not a Business Day or on any Business Day after 11:00 a.m., New York time, on such day, on the next Business Day.
Section 1.13 Requirements For Issuance of Letters of Credit.
The Seller shall authorize and direct the LC Bank to name the Seller or the Transferor as the “Applicant” or “Account Party” of each Letter of Credit.
Section 1.14 Disbursements, Reimbursement.
(a) Immediately upon the issuance of each Letter of Credit, each LC Participant shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the LC Bank a participation in such Letter of Credit and each drawing thereunder in an amount equal to such LC Participant’s Pro Rata Share of the face amount of such Letter of Credit and the amount of such drawing, respectively.
(b) In the event of any request for a drawing under a Letter of Credit by the beneficiary or transferee thereof, the LC Bank will promptly notify the Administrator and the Seller of such request. Provided that it shall have received such notice prior to 10:00 a.m., New York time, the Seller shall reimburse (such obligation to reimburse the LC Bank shall sometimes be referred to as a “Reimbursement Obligation” and the required date of reimbursement, the “Reimbursement Date”) the LC Bank prior to 12:00 p.m., New York time, on each Business Day that an amount is paid by the LC Bank under any Letter of Credit (each such date, a “Drawing Date”) (or, otherwise, by 12:00 p.m., New York time, on the Business Day immediately following such notice) in an
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amount equal to the amount so paid by the LC Bank. Such Reimbursement Obligation shall be satisfied by the Seller (i) first, by the remittance by the Administrator to the LC Bank of any available amounts then on deposit in the LC Collateral Account and (ii) second, by the remittance by or on behalf of the Seller to the LC Bank of any other funds of the Seller then available for disbursement. In the event the Seller fails to reimburse the LC Bank for the full amount of any drawing under any Letter of Credit by the applicable time on the Reimbursement Date, the LC Bank will promptly notify each LC Participant thereof, and the Seller shall be deemed to have requested that a Funded Purchase be made by the Purchasers in the Purchaser Groups for the LC Bank and the LC Participants to be disbursed on the Drawing Date under such Letter of Credit, subject to the amount of the unutilized portion of the Purchase Limit. Any notice given by the LC Bank pursuant to this Section may be oral if immediately confirmed in writing; provided that the lack of such an immediate written confirmation shall not affect the conclusiveness or binding effect of such oral notice.
(c) Each LC Participant shall upon any notice pursuant to subclause (b) above make available to the LC Bank an amount in immediately available funds equal to its Pro Rata Share of the amount of the drawing, whereupon the LC Participants shall each be deemed to have made a Funded Purchase in that amount. If any LC Participant so notified fails to make available to the LC Bank the amount of such LC Participant’s Pro Rata Share of such amount by no later than 2:00 p.m., New York time on the Drawing Date, then interest shall accrue on such LC Participant’s obligation to make such payment, from the Drawing Date to the date on which such LC Participant makes such payment (i) at a rate per annum equal to the Federal Funds Rate during the first three days following the Drawing Date and (ii) at a rate per annum equal to the rate applicable to Capital on and after the fourth day following the Drawing Date. The LC Bank will promptly give notice of the occurrence of the Drawing Date, but failure of the LC Bank to give any such notice on the Drawing Date or in sufficient time to enable any LC Participant to effect such payment on such date shall not relieve such LC Participant from its obligation under this subclause (c), provided that such LC Participant shall not be obligated to pay interest as provided in subclauses (i) and (ii) above until and commencing from the date of receipt of notice from the LC Bank or the Administrator of a drawing. Each LC Participant’s Commitment shall continue until the last to occur of any of the following events: (A) the LC Bank ceases to be obligated to issue or cause to be issued Letters of Credit hereunder; (B) no Letter of Credit issued hereunder remains outstanding and uncancelled or (C) all Persons (other than the Seller) have been fully reimbursed for all payments made under or relating to Letters of Credit.
Section 1.15 Repayment of Participation Advances.
(a) Upon (and only upon) receipt by the LC Bank for its account of immediately available funds from or for the account of the Seller (i) in reimbursement of any payment made by the LC Bank under a Letter of Credit with respect to which any LC Participant has made a participation advance to the LC Bank, or (ii) in payment of Discount on the Funded Purchases made or deemed to have been made in connection with any such draw, the LC Bank will pay to each LC Participant, ratably (based on the outstanding drawn amounts funded by each such LC Participant in respect of such Letter of Credit), in the same funds as those received by the LC Bank; it being understood, that the LC Bank shall retain a ratable amount of such funds that were not the subject of any payment in respect of such Letter of Credit by any LC Participant.
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(b) If the LC Bank is required at any time to return to the Seller, or to a trustee, receiver, liquidator, custodian, or any official in any insolvency proceeding, any portion of the payments made by the Seller to the LC Bank pursuant to this Agreement in reimbursement of a payment made under the Letter of Credit or interest or fee thereon, each LC Participant shall, on demand of the LC Bank, forthwith return to the LC Bank the amount of its Pro Rata Share of any amounts so returned by the LC Bank plus interest at the Federal Funds Rate, from the date the payment was first made to such LC Participant through, but not including, the date the payment is returned by such LC Participant.
(c) If any Letters of Credit are outstanding and undrawn on the Facility Termination Date, the LC Collateral Account shall be funded from Collections (or, in the Seller’s sole discretion, by other cash available to the Seller) in an amount equal to the aggregate undrawn face amount of such Letters of Credit plus all applicable fees to accrue through the stated expiration dates thereof (such fees to accrue, as reasonably estimated by the LC Bank, the “LC Fee Expectation”).
Section 1.16 Documentation.
The Seller agrees to be bound by the terms of the Letter of Credit Application and by the LC Bank’s interpretations of any Letter of Credit issued for the Seller and by the LC Bank’s written regulations and customary practices relating to letters of credit, though the LC Bank’s interpretation of such regulations and practices may be different from the Seller’s own. In the event of a conflict between the Letter of Credit Application and this Agreement, this Agreement shall govern. It is understood and agreed that, except in the case of gross negligence or willful misconduct by the LC Bank, the LC Bank shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following the Seller’s instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.
Section 1.17 Determination to Honor Drawing Request.
In determining whether to honor any request for drawing under any Letter of Credit by the beneficiary thereof, the LC Bank shall be responsible only to determine that the documents and certificates required to be delivered under such Letter of Credit have been delivered and that they comply on their face with the requirements of such Letter of Credit and that any other drawing condition appearing on the face of such Letter of Credit has been satisfied in the manner so set forth.
Section 1.18 Nature of Participation and Reimbursement Obligations.
Each LC Participant’s obligation in accordance with this Agreement to make participation advances as a result of a drawing under a Letter of Credit, and the obligations of the Seller to reimburse the LC Bank upon a draw under a Letter of Credit, shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Article I under all circumstances, including the following circumstances:
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(i) any set-off, counterclaim, recoupment, defense or other right which such LC Participant may have against the LC Bank, the Administrator, the Purchaser Agents, the Purchasers, the Seller or any other Person for any reason whatsoever;
(ii) the failure of the Seller or any other Person to comply with the conditions set forth in this Agreement for the making of a purchase, reinvestments, requests for Letters of Credit or otherwise, it being acknowledged that such conditions are not required for the making of participation advances hereunder;
(iii) any lack of validity or enforceability of any Letter of Credit or any set-off, counterclaim, recoupment, defense or other right which Seller, an Originator, the Transferor or any Affiliate thereof on behalf of which a Letter of Credit has been issued may have against the LC Bank, the Administrator, any Purchaser, any Purchaser Agent or any other Person for any reason whatsoever;
(iv) any claim of breach of warranty that might be made by the Seller, the Transferor, an Originator or an Affiliate thereof, the LC Bank or any LC Participant against the beneficiary of a Letter of Credit, or the existence of any claim, set-off, defense or other right which the Seller, the LC Bank or any LC Participant may have at any time against a beneficiary, any successor beneficiary or any transferee of any Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), the LC Bank, any LC Participant, the Administrator, any Purchaser or any Purchaser Agent or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Seller or any Subsidiaries of the Seller or any Affiliates of the Seller and the beneficiary for which any Letter of Credit was procured);
(v) the lack of power or authority of any signer of, or lack of validity, sufficiency, accuracy, enforceability or genuineness of, any draft, demand, instrument, certificate or other document presented under any Letter of Credit, or any such draft, demand, instrument, certificate or other document proving to be forged, fraudulent, invalid, defective or insufficient in any respect or any statement therein being untrue or inaccurate in any respect, even if the Administrator or the LC Bank has been notified thereof;
(vi) payment by the LC Bank under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit other than as a result of the gross negligence or willful misconduct of the LC Bank;
(vii) the solvency of, or any acts or omissions by, any beneficiary of any Letter of Credit, or any other Person having a role in any transaction or obligation relating to a Letter of Credit, or the existence, nature, quality, quantity, condition, value or other characteristic of any property or services relating to a Letter of Credit;
(viii) any failure by the LC Bank or any of the LC Bank’s Affiliates to issue any Letter of Credit in the form requested by the Seller, unless the LC Bank has
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received written notice from the Seller of such failure within three Business Days after the LC Bank shall have furnished the Seller a copy of such Letter of Credit and such error is material and no drawing has been made thereon prior to receipt of such notice;
(ix) any Material Adverse Effect on the Seller, the Transferor, any Originator or any Affiliates thereof;
(x) any breach of this Agreement or any Transaction Document by any party thereto;
(xi) the occurrence or continuance of an Insolvency Proceeding with respect to the Seller, the Transferor, any Originator or any Affiliate thereof;
(xii) the fact that a Termination Event or an Unmatured Termination Event shall have occurred and be continuing;
(xiii) the fact that this Agreement or the obligations of Seller or Servicer hereunder shall have been terminated; and
(xiv) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing.
Section 1.19 Indemnity.
In addition to other amounts payable hereunder, the Seller hereby agrees to protect, indemnify, pay and save harmless the Administrator, the LC Bank, each LC Participant and any of the LC Bank’s Affiliates that have issued a Letter of Credit from and against any and all claims, demands, liabilities, damages, taxes, penalties, interest, judgments, losses, costs, charges and expenses (including Attorney Costs) which the Administrator, the LC Bank, any LC Participant or any of their respective Affiliates may incur or be subject to as a consequence, direct or indirect, of the issuance of any Letter of Credit, except to the extent resulting from (a) the gross negligence or willful misconduct of the party to be indemnified as determined by a final non-appealable judgment of a court of competent jurisdiction or (b) the wrongful dishonor by the LC Bank of a proper demand for payment made under any Letter of Credit, except if such dishonor resulted from any act or omission, whether rightful or wrongful, of any present or future de jure or de facto Governmental Authority (all such acts or omissions herein called “Governmental Acts”).
Section 1.20 Liability for Acts and Omissions.
As between the Seller, on the one hand, and the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers, on the other, the Seller assumes all risks of the acts and omissions of, or misuse of any Letter of Credit by, the respective beneficiaries of such Letter of Credit. In furtherance and not in limitation of the respective foregoing, none of the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers shall be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient,
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inaccurate, fraudulent or forged (even if the LC Bank or any LC Participant shall have been notified thereof); (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of the Seller against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among the Seller and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, electronic mail, cable, telegraph, telex, facsimile or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers, including any Governmental Acts, and none of the above shall affect or impair, or prevent the vesting of, any of the LC Bank’s rights or powers hereunder. Nothing in the preceding sentence shall relieve the LC Bank from liability for its gross negligence or willful misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction, in connection with actions or omissions described in such clauses (i) through (viii) of such sentence. In no event shall the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers or their respective Affiliates, be liable to the Seller or any other Person for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses (including without limitation attorneys’ fees), or for any damages resulting from any change in the value of any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers and each of its Affiliates (i) may rely on any written communication believed in good faith by such Person to have been authorized or given by or on behalf of the applicant for a Letter of Credit; (ii) may honor any presentation if the documents presented appear on their face to comply with the terms and conditions of the relevant Letter of Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit, whether such dishonor was pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had initially been honored, together with any interest paid by the LC Bank or its Affiliates; (iv) may honor any drawing that is payable upon presentation of a statement advising negotiation or payment, upon receipt of such statement (even if such statement indicates that a draft or other document is being delivered separately), and shall not be liable for any failure of any such draft or other document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming that it rightfully honored under the laws or practices of the place where such bank is located; and (vi) may settle or adjust any claim or demand made on the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers or their respective Affiliates, in any way related to any order issued at the applicant’s request to an air carrier, a letter of guarantee or of indemnity issued to a carrier or any similar document (each an “Order”) and may honor any drawing in connection with any Letter of Credit that is the subject of such Order, notwithstanding that any drafts or other documents presented in connection with such Letter of Credit fail to conform in any way with such Letter of Credit.
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In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by the LC Bank under or in connection with any Letter of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith and without gross negligence or willful misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction, shall not put the LC Bank under any resulting liability to the Seller, any LC Participant or any other Person.
Section 1.21 Benchmark Replacement Setting.
(a) Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Transaction Document, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Transaction Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Transaction Document and (y) if a Benchmark Replacement is determined in accordance with clause (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Transaction Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Purchaser Agents without any amendment to, or further action or consent of any other party to, this Agreement or any other Transaction Document so long as the Administrator has not received, by such time, written notice from Purchaser Agents comprising the Majority Purchaser Agents of objection to such Benchmark Replacement determined in accordance with clause (2) of the definition of “Benchmark Replacement”.
(b) Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, the Administrator may make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Transaction Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Transaction Document.
(c) Notices; Standards for Decisions and Determinations. The Administrator will promptly notify the Seller and the Purchaser Agents of (i) the implementation of any Benchmark Replacement, and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. The Administrator will notify the Seller of (x) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (d) below and (y) the commencement of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrator or, if applicable, any Purchaser Agent (or group of Purchaser Agents) pursuant to this Section 1.21, including any
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determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Transaction Document except, in each case, as expressly required pursuant to this Section 1.21.
(d) Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Transaction Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrator in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative for a Benchmark (including a Benchmark Replacement), then the Administrator may modify the definition of “Yield Period” (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor; and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative for a Benchmark (including a Benchmark Replacement), then the Administrator may modify the definition of “Yield Period” (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate such previously removed tenor.
(e) Benchmark Unavailability Period. Upon the Seller’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Seller may revoke any pending request for a Purchase (or Portion of Capital thereof) accruing yield based on Daily 1M SOFR or the Term SOFR Rate, conversion to or continuation of any Portions of Capital accruing yield based on Daily 1M SOFR or the Term SOFR Rate to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Seller will be deemed to have converted any such request into a request for a Purchase accruing yield at the Base Rate. During a Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of the Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of the Base Rate.
Notwithstanding anything to the contrary contained herein, the “LC Participation Fee” (as defined in the applicable Fee Letter) shall not be amended solely in connection with selecting any replacement index in accordance with this Section 1.21.
(f) Certain Defined Terms. As used in this Section 1.21:
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate or is based on a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of a Settlement Period pursuant to this Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark pursuant to this Agreement, in each case, as of such date and not including, for the avoidance of doubt, any tenor of such Benchmark that is then-removed from the definition of “Settlement Period” pursuant to clause (d) of this Section 1.21.
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“Benchmark” means, initially, Daily 1M SOFR and the Term SOFR Rate; provided that if a Benchmark Transition Event has occurred with respect to the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to this Section 1.21.
“Benchmark Replacement” means, with respect to any Benchmark Transition Event, the first applicable alternative set forth in the order below that can be determined by the Administrator for the applicable Benchmark Replacement Date:
(1) the sum of: (A) Daily Simple SOFR and (B) the SOFR Adjustment; and
(2) the sum of (A) the alternate benchmark rate that has been selected by the Administrator and the Seller, giving due consideration to (x) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (y) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement to the then-current Benchmark for dollar-denominated syndicated credit facilities at such time and (B) the related Benchmark Replacement Adjustment;
provided, that if the Benchmark Replacement as determined pursuant to clause (2) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Transaction Documents; and provided further, that any Benchmark Replacement shall be administratively feasible as reasonably determined by the Administrator.
“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrator and the Seller, giving due consideration to (A) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention for determining such spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities at such time.
“Benchmark Replacement Date” means a date and time determined by the Administrator, which date shall be no later than the earliest to occur of the following events with respect to the then-current Benchmark:
(1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or
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(2) in the case of clause (3) of the definition of “Benchmark Transition Event,” the date determined by the Administrator, which date shall promptly follow the date of the public statement or publication of information referenced therein.
For the avoidance of doubt, the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
“Benchmark Transition Event” means, the occurrence of one or more of the following events, with respect to the then-current Benchmark:
(1) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);
(2) a public statement or publication of information by a Governmental Authority having jurisdiction over the Administrator, the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component thereof), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component thereof) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component thereof), which states that the administrator of such Benchmark (or such component thereof) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or
(3) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) or a Governmental Authority having jurisdiction over the Administrator announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative.
For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).
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“Benchmark Unavailability Period” means the period (if any) (x) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Transaction Document in accordance with this Section 1.21 and (y) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Transaction Document in accordance with this Section 1.21.
“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System of the United States and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System of the United States or the Federal Reserve Bank of New York, or any successor thereto.
“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.
Section 1.22 Conforming Changes Relating to Daily 1M SOFR and the Term SOFR Rate.
With respect to Daily 1M SOFR and the Term SOFR Rate, the Administrator will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Transaction Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Transaction Document; provided that, with respect to any such amendment effected, the Administrator shall provide notice to the Seller and each Purchaser Agent of each such amendment implementing such Conforming Changes reasonably promptly after such amendment becomes effective.
Section 1.23 Selection of Daily 1M SOFR and Term SOFR Rate; Rate Quotations.
(a) So long as no Termination Event is continuing, the Seller may, by written notice to the Administrator, elect for all or any portion of the Aggregate Capital to accrue Discount by reference to the Term SOFR Rate (rather than Daily 1M SOFR) during any Settlement Period. Any such notice must specify the amount of the Aggregate Capital subject of such election and must be delivered not later than two (2) Business Days prior to the first day of the affected Settlement Period. Any such portion of the Aggregate Capital that is subject to such an election shall be apportioned among the respective Purchasers’ Capital ratably. Notwithstanding the foregoing, (x) the Seller shall not make such an election if, as a result thereof, more than five Capital Tranches would exist and (y) each Capital Tranche accruing interest by reference to the Term SOFR Rate shall be not be less than the lower of (i) $300,000 and (ii) the aggregate amount of Purchases outstanding. For the avoidance of doubt, if a Termination Event is then continuing, the Discount for any Portion of Capital shall be determined pursuant to the definition of Discount notwithstanding any otherwise applicable election by the Seller.
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(b) The Seller may call the Administrator on or before the date on which an Purchase Notice is to be delivered to receive an indication of the rates then in effect, but it is acknowledged that such projection shall not be binding on the Administrator or the Purchasers nor affect the rate of interest which thereafter is actually in effect when the election is made.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1 Representations and Warranties; Covenants.
Each of the Seller and the Servicer hereby makes the representations and warranties, and hereby agrees to perform and observe the covenants, applicable to it as set forth in Exhibits III and IV, respectively.
Section 2.2 Termination Events.
If any of the Termination Events set forth in Exhibit V shall occur, the Administrator may (with the consent of the Majority Purchaser Agents) and shall (at the direction of the Majority Purchaser Agents), by notice to the Seller, declare the Facility Termination Date to have occurred (in which case the Facility Termination Date shall be deemed to have occurred); provided, that automatically upon the occurrence of any event (without any requirement for the passage of time or the giving of notice) described in paragraph (f) of Exhibit V, the Facility Termination Date shall occur. Upon any such declaration, occurrence or deemed occurrence of the Facility Termination Date, the Purchasers, the Purchaser Agents and the Administrator shall have, in addition to the rights and remedies that they may have under this Agreement, all other rights and remedies provided after default under the UCC and under other Applicable Law, which rights and remedies shall be cumulative.
ARTICLE III.
INDEMNIFICATION
Section 3.1 Indemnities by the Seller.
Without limiting any other rights that the Administrator, the Purchasers, the Purchaser Agents, the Liquidity Providers, any Program Support Provider or any of their respective Affiliates, employees, officers, directors, agents, counsel, successors, transferees or permitted assigns (each, an “Indemnified Party”) may have hereunder or under Applicable Law, the Seller hereby agrees to indemnify each Indemnified Party from and against any and all claims, damages, expenses, costs, losses, liabilities, penalties and taxes (including Attorney Costs) (all of the foregoing being collectively referred to as “Indemnified Amounts”) at any time imposed on or incurred by any Indemnified Party arising out of or otherwise relating to any Transaction Document, the transactions contemplated thereby or the acquisition of any portion of the Purchased Interest, or any action taken or omitted by any of the Indemnified Parties (including any action taken by the Administrator as attorney-in-fact for the Seller, the Transferor or any Originator hereunder or under any other Transaction Document) whether arising by reason of the acts to be performed by the Seller hereunder or otherwise, excluding only Indemnified Amounts to the
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extent: (a) a final judgment of a court of competent jurisdiction holds that such Indemnified Amounts resulted from gross negligence or willful misconduct of the Indemnified Party seeking indemnification, (b) due to the credit risk of the Obligor and for which reimbursement would constitute recourse to the Transferor, any Originator or the Servicer for uncollectible Receivables or (c) other than in the case of clause (xiii) below, such Indemnified Amounts include taxes imposed or based on, or measured by, the gross or net income or receipts of such Indemnified Party by the jurisdiction under the laws of which such Indemnified Party is organized, operates or where its principal executive office is located (or any political subdivision thereof); provided, however, that nothing contained in this sentence shall limit the liability of the Seller or the Servicer or limit the recourse of any Indemnified Party to the Seller or the Servicer for any amounts otherwise specifically provided to be paid by the Seller or the Servicer hereunder. Without limiting the foregoing indemnification, and subject to the exclusions in the preceding sentence, the Seller shall indemnify each Indemnified Party for Indemnified Amounts (including losses in respect of uncollectible Receivables regardless for purposes of these specific matters whether reimbursement therefor would constitute recourse to the Seller or the Servicer, except as set forth in subclause (viii) below) relating to or resulting from any of the following:
(i) the failure of any Receivable included in the calculation of the Net Receivables Pool Balance as an Eligible Receivable to be an Eligible Receivable, the failure of any information contained in any Information Package or any Interim Report to be true and correct, or the failure of any other information provided in writing to any Purchaser or the Administrator with respect to the Receivables or this Agreement to be true and correct;
(ii) the failure of any representation, warranty or statement made or deemed made by the Seller (or any employee, officer or agent of the Seller) under or in connection with this Agreement, any other Transaction Document, any Information Package, any Interim Report or any other information or report delivered by or on behalf of the Seller pursuant hereto to have been true and correct as of the date made or deemed made when made;
(iii) the failure by the Seller to comply with any Applicable Law related to any Receivable or the related Contract or the non-conformity of any Receivable or the related Contract with any such Applicable Law;
(iv) the failure of the Seller to vest and maintain vested in the Administrator (on behalf of the Secured Parties) a first priority perfected ownership interest or security interest in the Purchased Interest and the property conveyed hereunder, free and clear of any Lien;
(v) any commingling of funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled hereunder with any other funds;
(vi) the failure to have filed, in accordance with the requirements of this Agreement or any other Transaction Document, financing statements (including as-extracted collateral filings) or other similar instruments or documents under the UCC of each applicable jurisdiction or other Applicable Laws with respect to any Receivables in, or purporting to be in, the Receivables Pool and the other Pool Assets, whether at the time of any Purchase or at any subsequent time;
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(vii) any failure of a Lock-Box Bank to comply with the terms of the applicable Lock-Box Agreement;
(viii) any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including without limitation a defense based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale or lease of goods or the rendering of services related to such Receivable or the furnishing or failure to furnish any such goods or services or other similar claim or defense not arising from the financial inability of any Obligor to pay undisputed indebtedness;
(ix) any failure of the Seller to perform its duties or obligations in accordance with the provisions of this Agreement or any other Transaction Document to which it is a party;
(x) any action taken by the Administrator as attorney-in-fact for the Seller, the Transferor or any Originator pursuant to this Agreement or any other Transaction Document;
(xi) any environmental liability claim or products liability claim or other claim, investigation, litigation or proceeding, arising out of or in connection with merchandise, insurance or services that are the subject of any Contract;
(xii) the failure by the Seller to pay when due any taxes, including, without limitation, sales, excise or personal property taxes;
(xiii) any taxes arising because a Purchase or the Purchased Interest is not treated for U.S. federal, state and local income and franchise tax purposes as intended under Section 5.17(a);
(xiv) the use of proceeds of purchases or reinvestments or the issuance of any Letter of Credit;
(xv) any reduction in Capital as a result of the distribution of Collections pursuant to Section 1.4(d), if all or a portion of such distributions shall thereafter be rescinded or otherwise must be returned for any reason;
(xvi) any failure by the Seller to pay any premium or other amount when due under the terms of any Credit Insurance Policy in respect of Insured Receivables, to keep any Credit Insurance Policy in respect of Insured Receivables in force or to make or perfect any claim for reimbursement under any Credit Insurance Policy in respect of Insured Receivables; or
(xvii) any insurance premium payments paid by the Administrator on any Credit Insurance Policy in respect of Insured Receivables in accordance with this Agreement.
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Section 3.2 Indemnities by the Servicer.
Without limiting any other rights that any Indemnified Party may have hereunder or under Applicable Law, the Servicer hereby agrees to indemnify each Indemnified Party from and against any and all Indemnified Amounts arising out of or resulting from (whether directly or indirectly): (a) the failure of any information contained in an Information Package or any Interim Report to be true and correct, or the failure of any other information provided to any such Indemnified Party by, or on behalf of, the Servicer to be true and correct, (b) the failure of any representation, warranty or statement made or deemed made by the Servicer (or any of its officers) under or in connection with this Agreement or any other Transaction Document to which it is a party to have been true and correct as of the date made or deemed made when made, (c) the failure by the Servicer to comply with any Applicable Law with respect to any Pool Receivable or the related Contract, (d) any dispute, claim, offset or defense of the Obligor (other than as a result of discharge in bankruptcy with respect to such Obligor) to the payment of any Receivable in, or purporting to be in, the Receivables Pool resulting from or related to the collection activities with respect to such Receivable, (e) any commingling (other than as a result of actions taken by the Administrator, any Purchaser Agent or any Purchaser) of funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled hereunder with any other funds or (f) any failure of the Servicer to perform its duties or obligations in accordance with the provisions hereof or any other Transaction Document to which it is a party.
ARTICLE IV.
ADMINISTRATION, COLLECTIONS AND INSURANCE RECEIVABLES
Section 4.1 Appointment of the Servicer.
(a) The servicing, administering and collection of the Pool Receivables shall be conducted by the Person so designated from time to time as the Servicer in accordance with this Section. Until the Administrator gives notice to Arch Sales (in accordance with this Section) of the designation of a new Servicer, Arch Sales is hereby designated as, and hereby agrees to perform the duties and obligations of, the Servicer pursuant to the terms hereof. Upon the occurrence of a Termination Event, the Administrator may (with the consent of the Majority Purchaser Agents) and shall (at the direction of the Majority Purchaser Agents) designate as Servicer any Person (including itself) to succeed Arch Sales or any successor Servicer, on the condition in each case that any such Person so designated shall agree to perform the duties and obligations of the Servicer pursuant to the terms hereof.
(b) Upon the designation of a successor Servicer as set forth in clause (a), Arch Sales agrees that it will terminate its activities as Servicer hereunder in a manner that the Administrator determines will facilitate the transition of the performance of such activities to the new Servicer, and Arch Sales shall cooperate with and assist such new Servicer. Such cooperation shall include access to and transfer of related records (including all Contracts) and use by the new Servicer of all licenses, hardware or software necessary or desirable to collect the Pool Receivables and the Related Security.
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(c) Arch Sales acknowledges that, in making their decision to execute and deliver this Agreement, the Administrator, the Purchaser Agents and the Purchasers have relied on Arch Sales’ agreement to act as Servicer hereunder. Accordingly, Arch Sales agrees that it will not voluntarily resign as Servicer without the prior written consent of the Administrator and the Purchasers.
(d) The Servicer may delegate its duties and obligations hereunder to any subservicer (each a “Sub-Servicer”); provided, that, in each such delegation: (i) each such Sub-Servicer shall agree in writing to perform the delegated duties and obligations of the Servicer pursuant to the terms hereof, (ii) the Servicer shall remain liable for the performance of the duties and obligations so delegated, (iii) the Seller, the Administrator, the Purchaser Agents and the Purchasers shall have the right to look solely to the Servicer for performance, and (iv) the terms of any agreement with any Sub-Servicer shall provide that the Administrator may terminate such agreement upon the termination of the Servicer hereunder by giving notice of its desire to terminate such agreement to the Servicer (and the Servicer shall provide appropriate notice to each such Sub-Servicer); provided, however, that if any such delegation is to any Person other than an Originator or the Transferor, the Administrator and the Majority Purchaser Agents shall have consented in writing in advance to such delegation.
Section 4.2 Duties of the Servicer.
(a) The Servicer shall take or cause to be taken all such action as may be necessary or advisable to service, administer and collect each Pool Receivable from time to time, all in accordance with this Agreement and all Applicable Law, with reasonable care and diligence, and in accordance with the Credit and Collection Policies. The Servicer shall set aside, for the accounts of the Seller and the Purchasers, the amount of the Collections to which each is entitled in accordance with Article I. The Servicer may, in accordance with the applicable Credit and Collection Policy, take such action, including modifications, waivers or restructurings of Pool Receivables and the related Contracts as the Servicer may determine to be appropriate to maximize Collections thereof or reflect adjustments permitted under the Credit and Collection Policy or required under Applicable Laws or the applicable Contract; provided, however, that for the purposes of this Agreement (i) such action shall not change the number of days such Pool Receivable has remained unpaid from the date of the original due date related to such Pool Receivable, (ii) such action shall not alter the status of such Pool Receivable as a Delinquent Receivable or a Defaulted Receivable under this Agreement or limit the rights of any of the Purchasers, Purchaser Agents or the Administrator under this Agreement or any other Transaction Document and (iii) if a Termination Event has occurred and is continuing and Arch Sales or an Affiliate thereof is serving as the Servicer, Arch Sales or such Affiliate may take such action only upon the prior written approval of the Administrator. The Seller shall deliver to the Servicer and the Servicer shall hold for the benefit of the Seller and the Administrator (individually and for the benefit of the Purchasers), in accordance with their respective interests, all records and documents (including computer tapes or disks) with respect to each Pool Receivable. Notwithstanding anything to the contrary contained herein, if a Termination Event has occurred and is continuing, the Administrator may direct the Servicer (whether the Servicer is Arch Sales or any other Person) to commence or settle any legal action to enforce collection of any Pool Receivable or to foreclose upon or repossess any Related Security.
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(b) The Servicer shall, as soon as practicable following actual receipt of collected funds, turn over to the Seller the collections of any indebtedness that is not a Pool Receivable, less, if Arch Sales or an Affiliate thereof is not the Servicer, all reasonable and appropriate out-of-pocket costs and expenses of such Servicer of servicing, collecting and administering such collections. The Servicer, if other than Arch Sales or an Affiliate thereof, shall, as soon as practicable upon demand, deliver to the Seller all records in its possession that evidence or relate to any indebtedness that is not a Pool Receivable, and copies of records in its possession that evidence or relate to any indebtedness that is a Pool Receivable.
(c) The Servicer’s obligations hereunder shall terminate on the Final Payout Date. After such termination, if Arch Sales or an Affiliate thereof was not the Servicer on the date of such termination, the Servicer shall promptly deliver to the Seller all books, records and related materials that the Seller previously provided to the Servicer, or that have been obtained by the Servicer, in connection with this Agreement.
Section 4.3 Lock-Box Account and LC Collateral Account Arrangements.
Prior to the Closing Date, the Seller shall have entered into Lock-Box Agreements with all of the Lock-Box Banks and delivered original counterparts thereof to the Administrator. During the continuance of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, the Administrator may (and shall, at the direction of the Majority Purchaser Agents), at any time give notice to each Lock-Box Bank that the Administrator is exercising its rights under the Lock-Box Agreements to do any or all of the following: (a) to exercise exclusive dominion and control (for the benefit of the Secured Parties) over each of the Lock-Box Accounts and all funds on deposit therein and (b) to take any or all other actions permitted under the applicable Lock-Box Agreement. The Seller and the Servicer each hereby agree that if the Administrator at any time takes any action set forth in the preceding sentence, the Administrator shall have exclusive control (for the benefit of the Secured Parties) of each Lock-Box Account and of the proceeds (including Collections) of all Pool Receivables in such Lock-Box Accounts and the Seller and the Servicer hereby further agree to take any other action that the Administrator may reasonably request to transfer such control or to ensure that the Administrator maintains such control. Any proceeds of Pool Receivables received by the Seller or the Servicer thereafter shall be sent immediately to, or as otherwise instructed by, the Administrator. The Seller and the Servicer hereby irrevocably instruct the Administrator on each Business Day during the Minimum Liquidity Period, so long as the Administrator has taken exclusive dominion and control over each of the Lock-Box Accounts and no Termination Event or Unmatured Termination Event exists, to transfer all available amounts on deposit in the Lock-Box Accounts as of the end of each Business Day and after giving effect to any distributions to the Servicer on such day pursuant to Section 1.4(g), to the LC Collateral Account. The parties hereto hereby acknowledge that if it at any time takes control of any Lock-Box Accounts, the Administrator shall not have any rights to the funds therein in excess of the unpaid amounts due to the Administrator, the Purchaser Agents, the Purchasers, any Indemnified Party, any Affected Person or any other Person hereunder or under any other Transaction Document, and the Administrator shall distribute or cause to be distributed such funds in accordance with Section 4.2(b) and Article I (in each case as if such funds were held by the Servicer thereunder).
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The Administrator shall have exclusive dominion and control, including the exclusive right of withdrawal, over the LC Collateral Account and the Seller hereby grants the Administrator a security interest in the LC Collateral Account and all money or other assets on deposit therein or credited thereto. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrator and at the Seller’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in the LC Collateral Account. Moneys in the LC Collateral Account shall be applied by the Administrator to reimburse the LC Bank for each drawing under a Letter of Credit and for repayment of amounts owing by the Seller hereunder and under each of the other Transaction Documents to each of the other Secured Parties, it being understood and agreed that certain amounts on deposit in the LC Collateral Account may, from time to time, be remitted to the Servicer pursuant to Section 1.4(g). Amounts, if any, on deposit in the LC Collateral Account on the Final Payout Date shall be remitted by the Administrator to the Seller.
The Administrator shall, on each Settlement Date (if such date occurs on a Termination Day), remove any available amounts then on deposit in the LC Collateral Account and deposit such amounts into each Purchaser Agent’s account in accordance with the priorities set forth in Section 1.4(d), to the extent that any amounts are then due and owing under clauses first through third of Section 1.4(d)(ii) after giving effect to the distribution, if any, by the Servicer on such date in accordance with Section 1.4(d).
Section 4.4 Enforcement Rights.
(a) At any time following the occurrence and during the continuation of a Termination Event:
(i) the Administrator (at the Seller’s expense) may direct the Obligors that payment of all amounts payable under any Pool Receivable is to be made directly to the Administrator or its designee;
(ii) the Administrator may instruct the Seller or the Servicer to give notice of the Purchasers’ interest in Pool Receivables to each Obligor, which notice shall direct that payments be made directly to the Administrator or its designee (on behalf of the Secured Parties), and the Seller or the Servicer, as the case may be, shall give such notice at the expense of the Seller or the Servicer, as the case may be; provided, that if the Seller or the Servicer, as the case may be, fails to so notify each Obligor within two (2) Business Days following instruction by the Administrator, the Administrator (at the Seller’s or the Servicer’s, as the case may be, expense) may so notify the Obligors;
(iii) the Administrator may request the Servicer to, and upon such request the Servicer shall: (A) assemble all of the records necessary or desirable to collect the Pool Receivables and the Related Security, and transfer or license to a successor Servicer the use of all software necessary or desirable to collect the Pool Receivables and
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the Related Security, and make the same available to the Administrator or its designee (for the benefit of the Purchasers) at a place selected by the Administrator, and (B) segregate all cash, checks and other instruments received by it from time to time constituting Collections in a manner acceptable to the Administrator and, promptly upon receipt, remit all such cash, checks and instruments, duly endorsed or with duly executed instruments of transfer, to the Administrator or its designee; and
(iv) the Administrator may replace the Person then acting as Servicer.
(b) The Seller hereby authorizes the Administrator (on behalf of each Purchaser Group), and irrevocably appoints the Administrator as its attorney-in-fact with full power of substitution and with full authority in the place and stead of the Seller, which appointment is coupled with an interest, to take any and all steps in the name of the Seller and on behalf of the Seller necessary or desirable, in the determination of the Administrator, following the occurrence and during the continuation of a Termination Event, to collect any and all amounts or portions thereof due under any and all Pool Assets, including endorsing the name of the Seller on checks and other instruments representing Collections and enforcing such Pool Assets. Notwithstanding anything to the contrary contained in this subsection, none of the powers conferred upon such attorney-in-fact pursuant to the preceding sentence shall subject such attorney-in-fact to any liability if any action taken by it shall prove to be inadequate or invalid, nor shall they confer any obligations upon such attorney-in-fact in any manner whatsoever.
Section 4.5 Responsibilities of the Seller.
(a) Anything herein to the contrary notwithstanding, the Seller shall: (i) perform all of its obligations, if any, under the Contracts related to the Pool Receivables to the same extent as if interests in such Pool Receivables had not been transferred hereunder, and the exercise by the Administrator, any Purchaser Agent or any Purchaser of their respective rights hereunder shall not relieve the Seller from such obligations, and (ii) pay when due any taxes, including any sales taxes payable in connection with the Pool Receivables and their creation and satisfaction. None of the Administrator, the Purchaser Agents and the Purchasers shall have any obligation or liability with respect to any Pool Asset, nor shall any of them be obligated to perform any of the obligations of the Seller, the Transferor, ACI or any Originator thereunder.
(b) Arch Sales hereby irrevocably agrees that if at any time it shall cease to be the Servicer hereunder, it shall act (if the then-current Servicer so requests) as the data-processing agent of the Servicer and, in such capacity, Arch Sales shall conduct the data-processing functions of the administration of the Receivables and the Collections thereon in substantially the same way that Arch Sales conducted such data-processing functions while it acted as the Servicer.
Section 4.6 Servicing Fee.
(a) Subject to clause (b), the Servicer shall be paid a fee (the “Servicing Fee”) equal to 1.00% per annum (the “Servicing Fee Rate”) of the daily average aggregate Outstanding Balance of the Pool Receivables. The Purchasers’ Share of such fee shall be paid through the distributions contemplated by Section 1.4(d), and the Seller’s Share of such fee shall be paid by the Seller on each Settlement Date.
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(b) If the Servicer ceases to be Arch Sales or an Affiliate thereof, the servicing fee shall be the greater of: (i) the amount calculated pursuant to clause (a), and (ii) an alternative amount specified by the successor Servicer not to exceed 110% of the aggregate reasonable costs and expenses incurred by such successor Servicer in connection with the performance of its obligations as Servicer hereunder.
Section 4.7 Authorization and Action of the Administrator and Purchaser Agents.
(a) Each Purchaser and Purchaser Agent hereby accepts the appointment of and irrevocably authorizes the Administrator to take such actions as agent on its behalf and to exercise such powers as are delegated to the Administrator hereby and to exercise such other powers as are reasonably incidental thereto (including, without limitation, the Administrator’s entry into and execution of the No Proceedings Agreements). The Administrator shall hold, in its name, for the benefit of each Purchaser, ratably, the Purchased Interest. The Administrator shall not have any duties other than those expressly set forth herein or any fiduciary relationship with any Purchaser or Purchaser Agent, and no implied obligations or liabilities shall be read into this Agreement, or otherwise exist, against the Administrator. The Administrator does not assume, nor shall it be deemed to have assumed, any obligation to, or relationship of trust or agency with, the Seller or Servicer. Notwithstanding any provision of this Agreement or any other Transaction Document to the contrary, in no event shall the Administrator ever be required to take any action which exposes the Administrator to personal liability or which is contrary to the provisions of this Agreement, any other Transaction Document or Applicable Law. The appointment and authority of the Administrator hereunder shall terminate on the Final Payout Date.
(b) Each Purchaser hereby accepts the appointment of the respective institution identified as the Purchaser Agent for such Purchaser’s Purchaser Group on Schedule IV hereto or in the Assumption Agreement or Transfer Supplement pursuant to which such Purchaser becomes a party hereto, and irrevocably authorizes such Purchaser Agent to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to such Purchaser Agent by the terms of this Agreement, if any, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, no Purchaser Agent shall have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Purchaser or other Purchaser Agent or the Administrator, and no implied obligations or liabilities shall be read into this Agreement, or otherwise exist, against any Purchaser Agent.
(c) Except as otherwise specifically provided in this Agreement, the provisions of this Section 4.7 are solely for the benefit of the Administrator, the Purchaser Agents and the Purchasers, and none of the Seller or the Servicer shall have any rights as a third party beneficiary or otherwise under any of the provisions of this Section 4.7, except that this Section 4.7 shall not affect any obligations which the Administrator, any Purchaser Agent or any Purchaser may have to the Seller or the Servicer under the other provisions of this Agreement. Furthermore, no Purchaser shall have any rights as a third-party beneficiary or otherwise under any of the provisions hereof in respect of a Purchaser Agent that is not the Purchaser Agent for such Purchaser.
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(d) In performing its functions and duties hereunder, the Administrator shall act solely as the agent of the Purchasers and the Purchaser Agents and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller or Servicer or any of their successors and assigns. In performing its functions and duties hereunder, each Purchaser Agent shall act solely as the agent of its respective Purchasers and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller, the Servicer, any Purchaser not in such Purchaser Agent’s Purchaser Group, any other Purchaser Agent or the Administrator, or any of their respective successors and assigns.
Section 4.8 Nature of Administrator’s Duties; Delegation of Administrator’s Duties; Exculpatory Duties.
(a) The Administrator shall have no duties or responsibilities except those expressly set forth in this Agreement or in the other Transaction Documents. The duties of the Administrator shall be mechanical and administrative in nature. The Administrator shall not have, by reason of this Agreement, a fiduciary relationship in respect of any Purchaser. Nothing in this Agreement or any of the Transaction Documents, express or implied, is intended to or shall be construed to impose upon the Administrator any obligations in respect of this Agreement or any of the Transaction Documents except as expressly set forth herein or therein. The Administrator shall not have any duty or responsibility, either initially or on a continuing basis, to provide any Purchaser or Purchaser Agent with any credit or other information with respect to the Seller, any Originator, the Transferor, any Sub-Servicer or the Servicer, whether coming into its possession before the date hereof or at any time or times thereafter. If the Administrator seeks the consent or approval of the Purchasers or the Purchaser Agents to the taking or refraining from taking any action hereunder, the Administrator shall send notice thereof to each Purchaser (or such Purchaser’s Purchaser Agent, on its behalf) or each Purchaser Agent, as applicable. The Administrator shall promptly notify each Purchaser Agent any time that the Purchasers and/or Purchaser Agents, as the case may be, have instructed the Administrator to act or refrain from acting pursuant hereto.
(b) The Administrator may execute any of its duties through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrator shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.
(c) None of the Administrator and the Purchaser Agent, nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted (i) with the consent or at the direction of the Majority Purchaser Agents (or, in the case of any Purchaser Agent, the Purchasers within such Purchaser Agent’s Purchaser Group that have a majority of the aggregate Commitments of such Purchaser Group) or (ii) in the absence of such Person’s gross negligence or willful misconduct. The Administrator shall not be responsible to any Purchaser, Purchaser Agent or other Person for (i) any recitals, representations, warranties or other statements made by the Seller, any Sub-Servicer, the Servicer, the Transferor, any Originator or any of their
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Affiliates, (ii) the value, validity, effectiveness, genuineness, enforceability or sufficiency of any Transaction Document, (iii) any failure of the Seller, any Sub-Servicer, the Servicer, the Transferor, any Originator or any of their Affiliates to perform any obligation hereunder or under the other Transaction Documents to which it is a party (or under any Contract), or (iv) the satisfaction of any condition specified in Exhibit II. The Administrator shall not have any obligation to any Purchaser Agent or Purchaser to ascertain or inquire about the observance or performance of any agreement contained in any Transaction Document or to inspect the properties, books or records of the Seller, the Servicer, the Transferor, any Originator or any of their respective Affiliates.
Section 4.9 UCC Filings.
Each of the Seller and the Purchasers expressly recognizes and agrees that the Administrator may be listed as the assignee or secured party of record on the various UCC filings required to be made hereunder in order to perfect the transfer of the Purchased Interest from the Seller to the Purchasers, that such listing shall be for administrative convenience only in creating a record or nominee owner to take certain actions hereunder on behalf of the Purchasers and that such listing will not affect in any way the status of the Purchasers as the beneficial owners of the Purchased Interest. In addition, such listing shall impose no duties on the Administrator other than those expressly and specifically undertaken in accordance with this Section 4.9.
Section 4.10 Agent’s Reliance, Etc.
None of the Administrator and the Purchaser Agents, nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it as Administrator or as Purchaser Agent, as the case may be, under or in connection with this Agreement except for such Person’s own gross negligence or willful misconduct. Each of the Administrator and each Purchaser Agent: (i) may consult with legal counsel (including counsel for the Seller), independent public accountants and other experts selected by the Administrator and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (ii) makes no warranty or representation to any Purchaser or Purchaser Agent and shall not be responsible to any Purchaser or Purchaser Agent for any statements, warranties or representations made in or in connection with this Agreement; (iii) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement on the part of the Seller, the Servicer, any Sub-Servicer, the Transferor or any Originator or to inspect the property (including the books and records) of the Seller, the Servicer, any Sub-Servicer, the Transferor or any Originator; (iv) shall not be responsible to any Purchaser or Purchaser Agent for the due execution, legality, validity, enforceability, genuineness, sufficiency, or value of this Agreement, or any other instrument or document furnished pursuant hereto; and (v) shall incur no liability under or in respect of this Agreement or any other Transaction Document by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by telex) believed by it to be genuine and signed or sent by the proper party or parties. The Administrator may at any time request instructions from the Purchasers and/or Purchaser Agents, and the Purchaser Agents may at any time request instructions from the Purchasers in their Purchaser Groups, with respect to any actions or approvals which by the terms of this Agreement or of any of the other Transaction
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Documents the Administrator or such Purchaser Agent is permitted or required to take or to grant, and if such instructions are promptly requested, the Administrator and/or such Purchaser Agent shall be absolutely entitled to refrain from taking any action or to withhold any approval and shall not be under any liability whatsoever to any Person for refraining from any action or withholding any approval under any of the Transaction Documents until it shall have received such instructions from the Majority Purchaser Agents, in the case of the Administrator or Purchasers holding the majority of the aggregate of the Commitments in such Purchaser Agent’s Purchaser Group, in the case of any Purchaser Agent (or, in either case, where expressly required hereunder, from the Majority LC Participants, the LC Bank, all of the Purchasers and/or all of the LC Participants). Without limiting the foregoing, (x) none of the Purchasers and the Purchaser Agents shall have any right of action whatsoever against the Administrator as a result of the Administrator acting or refraining from acting under this Agreement or any of the other Transaction Documents in accordance with the instructions of the Majority Purchaser Agents and (y) none of the Purchasers in a Purchaser Agent’s Purchaser Group shall have any right of action whatsoever against such Purchaser Agent as a result of such Purchaser Agent acting or refraining from acting under this Agreement or any of the other Transaction Documents in accordance with the instructions of the Purchasers within such Purchaser Agent’s Purchaser Group with a majority of the Commitments of such Purchaser Group. The Administrator shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement in accordance with a request of the required Purchasers or required Purchaser Agents, and such request and any action taken or failure to act pursuant thereto shall be binding upon all Purchasers, all Purchaser Agents and the Administrator. Each Purchaser Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement in accordance with a request of the Purchasers in such Purchaser Agent’s Purchaser Group with a majority of the Commitments of such Purchaser Group, and any such request and any action taken or failure to act pursuant thereto shall be binding upon all the Purchasers in such Purchaser Agent’s Purchaser Group and such Purchaser Agent.
Section 4.11 Administrator and Affiliates.
To the extent that the Administrator or any of its Affiliates is or shall become an LC Participant hereunder, the Administrator or such Affiliate, in such capacity, shall have the same rights and powers under this Agreement as would any other LC Participant hereunder and may exercise the same as though it were not the Administrator. The Administrator and its Affiliates may generally engage in any kind of business with the Seller, the Transferor, any Originator, ACI, any Sub-Servicer or the Servicer, any of their respective Affiliates and any Person who may do business with or own securities of the Seller, the Transferor, any Originator, ACI, any Sub-Servicer or the Servicer or any of their respective Affiliates, all as if it were not the Administrator hereunder and without any duty to account therefor to any Purchaser Agent, or Purchaser.
Section 4.12 Notice of Termination Events.
Neither the Administrator nor any Purchaser Agent shall be deemed to have knowledge or notice of the occurrence of any Termination Event or Unmatured Termination Event unless it has received notice from, in the case of the Administrator, any Purchaser Agent, any Purchaser, the Servicer or the Seller and, in the case of any Purchaser Agent, the Administrator, any other Purchaser Agent, any Purchaser, the Servicer or the Seller, in each case stating that a
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Termination Event or an Unmatured Termination Event has occurred hereunder and describing such Termination Event or Unmatured Termination Event. In the event that the Administrator receives such a notice, it shall promptly give notice thereof to each Purchaser Agent. In the event that a Purchaser Agent receives such a notice, it shall promptly give notice thereof to the Administrator (unless such Purchaser Agent first received notice of such Termination Event or Unmatured Termination Event from the Administrator) and to each of its related Purchasers. The Administrator shall take such action concerning a Termination Event or an Unmatured Termination Event as may be directed by the Majority Purchaser Agents (unless such action otherwise requires the consent of the required Purchasers, all Purchaser Agents or the LC Bank), but until the Administrator receives such directions, the Administrator may (but shall not be obligated to) take such action, or refrain from taking such action, as the Administrator deems advisable and in the best interests of the Purchasers and Purchaser Agents.
Section 4.13 Non-Reliance on Administrator, Purchaser Agents and other Purchasers; Administrators and Affiliates.
(a) Each Purchaser and Purchaser Agent expressly acknowledges that none of the Administrator and the Purchaser Agents, in the case of such Purchaser, and none of the Administrator or any other Purchaser Agent, in the case of such Purchaser Agent, nor in either case any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrator or any Purchaser Agent hereafter taken, including any review of the affairs of the Seller, the Transferor, ACI, the Servicer or any Originator, shall be deemed to constitute any representation or warranty by the Administrator or such Purchaser Agent. Each Purchaser and Purchaser Agent represents and warrants to the Administrator and such Purchaser’s Purchaser Agent, in the case of such Purchaser, and Administrator, in the case of such Purchaser Agent, that it has, independently and without reliance upon the Administrator, the LC Bank, any Purchaser Agent or any Purchaser and based on such documents and information as it has deemed appropriate, made and will continue to make its own appraisal of any investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Seller, the Transferor, ACI, the Servicer or the Originators, and made its own evaluation and decision to enter into this Agreement. Except for terms specifically required to be delivered hereunder, the Administrator shall not have any duty or responsibility to provide any Purchaser or Purchaser Agent, and no Purchaser Agent have any duty or responsibility to provide any Purchaser, with any information concerning the Seller, the Transferor, ACI, the Servicer or the Originators or any of their Affiliates that comes into the possession of the Administrator or such Purchaser Agent, respectively, or any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates.
(b) Each of the Purchasers, the Purchaser Agents and the Administrator and any of their respective Affiliates may extend credit to, accept deposits from and generally engage in any kind of banking, trust, debt, entity or other business with the Seller, the Transferor, ACI, the Servicer or any Originator or any of their Affiliates. With respect to the acquisition of the Eligible Receivables pursuant to this Agreement, each of the Purchaser Agents and the Administrator shall have the same rights and powers under this Agreement as any Purchaser and may exercise the same as though it were not such an agent, and the terms “Purchaser” and “Purchasers” shall include, to the extent applicable, each of the Purchaser Agents and the Administrator in their individual capacities.
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Section 4.14 Indemnification.
Each LC Participant and Related Committed Purchaser agrees to indemnify and hold harmless the Administrator and its officers, directors, employees, representatives and agents and the LC Bank (to the extent not reimbursed by the Seller, the Transferor, the Servicer or any Originator and without limiting the obligation of the Seller, the Transferor, the Servicer, or any Originator to do so), ratably according to its Pro Rata Share, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, settlements, costs, expenses and, or disbursements of any kind or nature whatsoever (including, in connection with any investigative or threatened proceeding, whether or not the Administrator, the LC Bank or such Person shall be designated a party thereto) that may at any time be imposed on, incurred by, or asserted against the Administrator, LC Bank or such Person as a result of, or related to, any of the transactions contemplated by the Transaction Documents or the execution, delivery or performance of the Transaction Documents or any other document furnished in connection therewith; provided, however, that no LC Participant or Related Committed Purchaser shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, or disbursements resulting from the Administrator’s or the LC Bank’s gross negligence or willful misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction. Without limiting the generality of the foregoing, each LC Participant agrees to reimburse the Administrator and the LC Bank, ratably according to their Pro Rata Shares, promptly upon demand, for any out-of-pocket expenses (including reasonable counsel fees) incurred by the Administrator or the LC Bank in connection with the administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of its rights or responsibilities under, this Agreement.
Section 4.15 Successor Administrator.
The Administrator may, upon at least thirty (30) days’ notice to the Seller, the Purchaser Agents and the Servicer, resign as Administrator. Such resignation shall not become effective until a successor Administrator is appointed by the Majority Purchaser Agents and the LC Bank (subject to the consent of the Seller, so long as no Termination Event exists, such consent not to be unreasonably withheld, conditioned or delayed) and has accepted such appointment. If no successor Administrator shall have been so appointed by the Majority Purchaser Agents and the LC Bank within sixty (60) days after the resigning Administrator’s giving of notice of resignation, the resigning Administrator may, on behalf of the Secured Parties, petition a court of competent jurisdiction to appoint a successor Administrator. Upon such acceptance of its appointment as Administrator hereunder by a successor Administrator, such successor Administrator shall succeed to and become vested with all the rights and duties of the resigning Administrator, and the resigning Administrator shall be discharged from its duties and obligations under the Transaction Documents. After any resigning Administrator’s resignation hereunder, the provisions of Sections 3.1 and 3.2 and this Article IV shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrator.
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Section 4.16 Credit Insurance Policies.
| (a) | At all times prior to the Final Payout Date while any Pool Receivables are being reported as Insured Receivables: |
| (i) | the Seller shall maintain the Credit Insurance Policy with respect thereto in full force and effect; |
| (ii) | the Seller shall pay all premiums and other amounts due by the Seller from time to time under such Credit Insurance Policy when due in accordance with the terms thereof; |
| (iii) | the Seller and the Servicer shall refrain from taking any action or omitting to take any action which could reasonably be expected to prejudice or limit the Seller’s or the Administrator’s rights to payment under such Credit Insurance Policy with respect to the Pool Receivables insured thereby; |
| (iv) | the Seller and the Servicer shall enforce the obligations of the applicable Credit Insurer under such Credit Insurance Policy; |
| (v) | the Seller and the Servicer shall maintain all records and documents that may be necessary to make claims for reimbursement under such Credit Insurance Policy; |
| (vi) | the Seller and the Servicer shall, and the Servicer shall cause the Seller to, perform all its other obligations under such Credit Insurance Policy in accordance with the terms thereof (including, without limitation, delivering information regarding the relevant Pool Receivables and notices of insolvency with respect to Obligors when required pursuant to the terms of such Credit Insurance Policy); |
| (vii) | the Seller and Servicer shall advise promptly the Administrator of any payment the Seller receives directly under any Credit Insurance Policy, any denial of coverage under any such policy, any cancelation of such policy or any other information received in connection with any such policy which is material to the payment of any claim thereunder; |
| (viii) | neither the Seller nor Servicer shall amend, modify or waive (or consent to any such amendment, modification or waiver of) any provision of any Credit Insurance Policy in respect of Insured Receivables, which is material to the payment of any claim thereunder, without the prior written consent of the Administrator and Majority Purchaser Agents; and |
| (ix) | the Seller and Servicer shall deliver any additional instruments, certificates and documents, provide such other information and take such other actions as may be necessary or desirable, in the reasonable opinion of the Administrator, to give further assurances of any of the rights granted or provided for herein or under any Credit Insurance Policy (including, without limitation, providing copies of invoices, purchase orders, and the proof of delivery of products as may be requested by the insurer thereunder). |
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| (b) | If the Seller fails to pay any premium or other amount due under any Credit Insurance Policy, the Administrator may (in its sole discretion) pay such premium or other amount from the Pool Assets or Collections thereon or from its own funds in order to keep such Credit Insurance Policy in force. Any amount so paid by the Administrator from its own funds shall constitute an Indemnified Amount payable by the Seller to the Administrator hereunder. |
| (c) | As to any Insured Designated Receivables only, in the event that any Obligor defaults on the payment of any of its Pool Receivables, becomes subject to an Insolvency Proceeding or becomes subject to any other event that gives rise to a claim for reimbursement under a Credit Insurance Policy, the Seller and the Servicer shall, promptly (but not later than the later of (x) ten (10) Business Days after such event or (y) the first date on which such a claim may be filed pursuant to the terms of such Credit Insurance Policy), file a claim for such reimbursement (with a copy thereof to the Administrator) in accordance with the terms of such Credit Insurance Policy and shall take any other actions required under the terms of such Credit Insurance Policy to obtain such reimbursement (including, without limitation, providing the applicable Credit Insurer with itemized statements, invoices, bills of lading, purchase orders, summaries of collections efforts, evidence of debt or other documentation that may be required under the terms of such Credit Insurance Policy). The Seller and the Servicer shall cause any amounts paid by a Credit Insurer under any Credit Insurance Policy to be paid directly to a Lock-Box Account owned by the Seller and to be applied as a Collection in accordance with the terms of this Agreement. |
| (d) | In the event that a Credit Insurer pays a claim under a Credit Insurance Policy with respect to a Pool Receivable and the Seller is required to subrogate its rights, claims, guaranties, security, collateral or defenses to such Credit Insurer in respect of such Pool Receivable, the Seller shall (and the Servicer shall cause Seller to) so subrogate such rights, claims, guaranties, security, collateral or defenses in accordance with the terms of such Credit Insurance Policy. Simultaneously with receipt of such a payment in a Lock-Box Account and upon such subrogation, the Administrator shall be automatically deemed to have released to the Seller any ownership or security interest it may have hereunder (on behalf of itself and the Purchasers) in such rights, claims, guaranties, security, collateral or defenses so subrogated, to the extent necessary to permit such subrogation; provided, however, that the Administrator shall not be deemed to have released any such ownership or security interest it may have in related rights under such Credit Insurance Policy (including, without limitation, any right of the Seller to receive ratable or other allocations of Collections or other recoveries in respect of the related Pool Receivables). |
| (e) | If any Credit Insurance Policy ceases to be Eligible Credit Insurance, the Seller and the Servicer shall furnish to the Administrator and each Purchaser Agent written notice thereof, together with a statement of the actions the Seller plans to take to remedy such situation, if any, promptly but not later than five (5) Business Days thereafter. |
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| (f) | Any Collections received by the Administrator pursuant to the Credit Insurance Policy (including as an additional insured thereunder) shall be distributed in accordance with the priority of payments set forth in Section 1.4(d). |
ARTICLE V.
MISCELLANEOUS
Section 5.1 Amendments, Etc.
No amendment or waiver of any provision of this Agreement or any other Transaction Document, or consent to any departure by the Seller or the Servicer therefrom, shall be effective unless in a writing signed by the Administrator, the Majority Purchaser Agents and the LC Bank and, in the case of an amendment, by the other parties thereto (other than the Secured Parties); provided, however, that no such amendment shall, (a) without the consent of each affected Purchaser, (i) extend the date of any payment or deposit of Collections by the Seller or the Servicer or decrease the outstanding amount of or rate of Discount or extend the repayment of or any scheduled payment date for the payment of any Discount in respect of any Portion of Capital or any fees owed to a Purchaser; (ii) reduce any fees payable pursuant to the applicable Fee Letter, (iii) forgive or waive or otherwise excuse any repayment of Capital or change either the amount of Capital of any Purchaser or any Purchaser’s pro rata share of the Purchased Interest; (iii) increase the Commitment of any Purchaser; (iv) amend or modify the Pro Rata Share of any LC Participant; (v) amend or modify the provisions of this Section 5.1 or of Section 4.3, Exhibit V or the definition of “Eligible Receivables”, “Eligible Credit Insurance”, “Eligible Supporting Letter of Credit”, “Net Receivables Pool Balance”, “Majority LC Participants”, “Majority Purchaser Agents”, “Minimum Liquidity”, “Minimum Liquidity Period”, “Purchased Interest”, “Scheduled Commitment Termination Date”, “Termination Day”, “Termination Event” or “Total Reserves” or (vi) amend or modify any defined term (or any term used directly or indirectly in such defined term) used in clauses (i) through (v) above in a manner that would circumvent the intention of the restrictions set forth in such clauses and (b) without the consent of the Majority Purchaser Agents and/or Majority LC Participants, as applicable, amend, waive or modify any provision expressly requiring the consent of such Majority Purchaser Agents and/or Majority LC Participant. Each such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. The Administrator hereby agrees to provide executed copies of any material amendment or waiver of any provision of this Agreement or any other Transaction Document to the Rating Agencies if requested by any party hereto. No failure on the part of any Purchaser Agent, any Purchaser or the Administrator to exercise, and no delay in exercising any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right.
Section 5.2 Notices, Etc.
All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile or electronic mail communication) and shall be personally delivered or sent by facsimile, electronic mail or by overnight mail, to the intended party at the mailing address or electronic mail address or facsimile number of such party
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set forth under its name on the signature pages hereof (or in any other document or agreement pursuant to which it is or became a party hereto), or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective (i) if delivered by overnight mail, when received, and (ii) if transmitted by facsimile or electronic mail, when sent, receipt confirmed by telephone or electronic means.
Section 5.3 Successors and Assigns; Assignability; Participations.
(a) Successors and Assigns. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party; all covenants, promises and agreements by or on behalf of any parties hereto that are contained in this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns. Except as otherwise provided in Section 4.1(d) or Section 4.4(a)(iv), neither the Seller nor the Servicer may assign or transfer any of its rights or delegate any of its duties hereunder or under any Transaction Document without the prior written consent of the Administrator, each Purchaser Agent and the LC Bank.
(b) Participations. (i) Except as otherwise specifically provided herein, any Purchaser may sell to one or more Persons (each a “Participant”) participating interests in the interests of such Purchaser hereunder; provided, that no Purchaser shall grant any participation under which the Participant shall have rights to approve any amendment to or waiver of this Agreement or any other Transaction Document. Such Purchaser shall remain solely responsible for performing its obligations hereunder, and the Seller, the Servicer, each Purchaser Agent and the Administrator shall continue to deal solely and directly with such Purchaser in connection with such Purchaser’s rights and obligations hereunder. A Purchaser shall not agree with a Participant to restrict such Purchaser’s right to agree to any amendment, waiver or modification hereto, except amendments, waivers or modifications that require the consent of all Purchasers. (ii) Notwithstanding anything contained in paragraph (a) or clause (i) of paragraph (b) of this Section 5.3, each of the LC Bank and each LC Participant may sell participations in all or any part of any Funded Purchase made by such LC Participant to another bank or other entity so long as (x) no such grant of a participation shall, without the consent of the Seller, require the Seller to file a registration statement with the SEC and (y) no holder of any such participation shall be entitled to require such LC Participant to take or omit to take any action hereunder except that such LC Participant may agree with such participant that, without such Participant’s consent, such LC Participant will not consent to an amendment, modification or waiver that requires the consent of all LC Participants. Any such Participant shall not have any rights hereunder or under the Transaction Documents. (iii) Each Purchaser that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Seller, maintain a register on which it enters the name and address of each Participant and the interest in a Purchased Interest (and Discount, fees and other similar amounts under this Agreement) of each Participant’s interest in a Purchased Interest or other obligations under the Transaction Documents (the “Participant Register”); provided that no Purchaser shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in a Purchased Interest) to any Person except to the extent that such disclosure is necessary to establish that a Purchased Interest is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The
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entries in the Participant Register shall be conclusive absent manifest error, and such Purchaser shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrator (in its capacity as Administrator) shall have no responsibility for maintaining a Participant Register.
(c) Assignments by Related Committed Purchasers. Any Related Committed Purchaser may assign to one or more Persons (each a “Purchasing Related Committed Purchaser”), reasonably acceptable to each of the Administrator, the LC Bank and the related Purchaser Agent in each such Person’s sole and absolute discretion, its rights and obligations herein (including its Commitment (which shall be inclusive of its Commitment as an LC Participant)) in whole or in part, pursuant to a supplement hereto, substantially in the form of Annex G with any changes as have been approved by the parties thereto (each, a “Transfer Supplement”), executed by each such Purchasing Related Committed Purchaser, such selling Related Committed Purchaser, such related Purchaser Agent and the Administrator and with the consent of the Seller (provided, that the consent of the Seller shall not be unreasonably withheld, conditioned or delayed and that no such consent shall be required if (i) a Termination Event or Unmatured Termination Event has occurred and is continuing or (ii) such assignment is made by any Related Committed Purchaser to (A) the Administrator, (B) any other Related Committed Purchaser, (C) any Affiliate of the Administrator or any Related Committed Purchaser, (D) any commercial paper conduit or similar financing vehicle sponsored or administered by such Purchaser and for whom such Purchaser acts as a program support provider or through which (directly or indirectly) such Purchaser does or may fund Purchases hereunder (each, a “Conduit”), (E) any Liquidity Provider, (F) any Program Support Provider or (G) any Person that (1) is in the business of issuing commercial paper notes and (2) is associated with or administered by the Administrator or such Related Committed Purchaser or any Affiliate of the Administrator or such Related Committed Purchaser). Upon (i) the execution of the Transfer Supplement, (ii) delivery of an executed copy thereof to the Seller, the Servicer, such related Purchaser Agent and the Administrator and (iii) payment by the Purchasing Related Committed Purchaser to the selling Related Committed Purchaser of the agreed purchase price, if any, such selling Related Committed Purchaser shall be released from its obligations hereunder to the extent of such assignment and such Purchasing Related Committed Purchaser shall for all purposes be a Related Committed Purchaser party hereto and shall have all the rights and obligations of a Related Committed Purchaser hereunder to the same extent as if it were an original party hereto. The amount of the Commitment of the selling Related Committed Purchaser allocable to such Purchasing Related Committed Purchaser shall be equal to the amount of the Commitment of the selling Related Committed Purchaser transferred regardless of the purchase price, if any, paid therefor. The Transfer Supplement shall be an amendment hereof only to the extent necessary to reflect the addition of such Purchasing Related Committed Purchaser as a “Related Committed Purchaser” and a related “LC Participant” and any resulting adjustment of the selling Related Committed Purchaser’s Commitment and, if applicable, selling related LC Participant’s Pro Rata Share of the LC Participation Amount.
(d) Assignments to Liquidity Providers and other Program Support Providers. Any Conduit Purchaser may at any time grant to one or more of its Liquidity Providers or other Program Support Providers participating interests in its portion of the Purchased Interest. In the event of any such grant by such Conduit Purchaser of a participating interest to a Liquidity Provider or other Program Support Provider, such Conduit Purchaser shall remain responsible for the performance of its obligations hereunder. The Seller agrees that each Liquidity Provider and Program Support Provider shall be entitled to the benefits of Sections 1.7 and 1.8.
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(e) Other Assignment by Conduit Purchasers. Each party hereto agrees and consents (i) to any Conduit Purchaser’s assignment, participation, grant of security interests in or other transfers of any portion of, or any of its beneficial interest in, the Purchased Interest (or portion thereof), including without limitation to any collateral agent in connection with its commercial paper program and (ii) to the complete assignment by any Conduit Purchaser of all of its rights and obligations hereunder to any other Person, and upon such assignment such Conduit Purchaser shall be released from all obligations and duties, if any, hereunder; provided, that such Conduit Purchaser may not, without the prior consent of its Related Committed Purchasers, make any such transfer of its rights hereunder unless the assignee (x) is a Conduit or (y) (i) is principally engaged in the purchase of assets similar to the assets being purchased hereunder, (ii) has as its Purchaser Agent the Purchaser Agent of the assigning Conduit Purchaser and (iii) issues commercial paper or other Notes with credit ratings substantially comparable to the ratings of the assigning Conduit Purchaser. Any assigning Conduit Purchaser shall deliver to any assignee a Transfer Supplement with any changes as have been approved by the parties thereto, duly executed by such Conduit Purchaser, assigning any portion of its interest in the Purchased Interest to its assignee. Such Conduit Purchaser shall promptly (i) notify each of the other parties hereto of such assignment and (ii) take all further action that the assignee reasonably requests in order to evidence the assignee’s right, title and interest in such interest in the Purchased Interest and to enable the assignee to exercise or enforce any rights of such Conduit Purchaser hereunder. Upon the assignment of any portion of its interest in the Purchased Interest, the assignee shall have all of the rights hereunder with respect to such interest (except that the Discount therefor shall thereafter accrue at the rate, determined with respect to the assigning Conduit Purchaser unless the Seller, the related Purchaser Agent and the assignee shall have agreed upon a different Discount).
(f) Certain Pledges. Without limiting the right of any Purchaser to sell or grant interests, security interests or participations to any Person as otherwise described in this Article V, above, any Purchaser may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure its obligations as a Purchaser hereunder, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Purchaser from any of its obligations hereunder or substitute any such pledge or assignee for such Purchaser as a party hereto.
(g) Assignment by Administrator. Subject to Section 4.15 (if applicable), this Agreement and the rights and obligations of the Administrator hereunder shall be assignable, in whole or in part, by the Administrator and its successors and assigns; provided, that unless: (i) such assignment is to an Affiliate of PNC, (ii) it becomes unlawful for PNC to serve as the Administrator or (iii) a Termination Event exists, the Seller has consented to such assignment, which consent shall not be unreasonably withheld, conditioned or delayed.
(h) Agents. Without limiting any other rights that may be available under Applicable Law, the rights of the Purchasers and each Liquidity Provider may be enforced through it or by its agents.
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(i) Disclosure; Notice. Each assignor may, in connection with an assignment permitted hereunder, disclose to the applicable assignee (that shall have agreed to be bound by Section 5.6) any information relating to the Servicer, the Seller or the Pool Receivables furnished to such assignor by or on behalf of the Servicer, the Seller, any Purchaser, any Purchaser Agent or the Administrator. Such assignor shall give prior written notice to Seller of any assignment of such assignor’s rights and obligations (including ownership of the Purchased Interest) to any Person other than a Program Support Provider.
(j) Opinions of Counsel. If required by the Administrator or the applicable Purchaser Agent or to maintain the ratings of the Notes of any Conduit Purchaser, each Transfer Supplement or other assignment and acceptance agreement must be accompanied by an opinion of counsel of the assignee as to matters as the Administrator or such Purchaser Agent may reasonably request.
Section 5.4 Costs, Expenses and Taxes.
(a) By way of clarification, and not of limitation, of Sections 1.7, 1.19 or 3.1, the Seller shall pay to the Administrator, any Purchaser Agent and/or any Purchaser on demand all costs and expenses in connection with (i) the preparation, execution, delivery and administration (including amendments or waivers of any provision) of this Agreement and the other Transaction Documents along with all related documents and agreements (including the Confirmation Order and any other court filings in connection therewith), (ii) the sale of the Purchased Interest (or any portion thereof), (iii) the perfection (and continuation) of the Administrator’s rights (on behalf of the Secured Parties) in the Receivables, Collections and other Pool Assets, (iv) the enforcement by the Administrator, the Purchaser Agents or the Purchasers of the obligations of the Seller, the Transferor, the Servicer or the Originators under the Transaction Documents or of any Obligor under a Receivable and (v) the maintenance by the Administrator of the Lock-Box Accounts (and any related lock-box or post office box), including Attorney Costs relating to any of the foregoing or to advising the Administrator, any Purchaser Agent, any Purchaser, any Liquidity Provider or any other Program Support Provider about its rights and remedies under any Transaction Document and all costs and expenses (including Attorney Costs) of the Administrator, the Purchaser Agents, the Purchasers, any Liquidity Provider or Program Support Provider in connection with the enforcement of the Transaction Documents and in connection with the administration of the Transaction Documents. Subject to Section 1(e) of Exhibit IV of this Agreement, the Seller shall reimburse the Administrator, each Purchaser Agent and each Purchaser for the cost of such Person’s auditors (which may be employees of such Person) auditing the books, records and procedures of the Seller or the Servicer. The Seller shall reimburse each Conduit Purchaser for any amounts such Conduit Purchaser must pay to any Liquidity Provider or other Program Support Provider on account of any Tax. The Seller shall reimburse each Conduit Purchaser on demand for all reasonable costs and expenses incurred by such Conduit Purchaser or any holder of membership interests of such Conduit Purchaser in connection with the Transaction Documents or the transactions contemplated thereby, including costs related to the auditing of the Conduit Purchaser’s books by certified public accountants, Rating Agency fees and fees and out of pocket expenses of counsel of the Administrator, any Purchaser Agent and any Purchaser, or any membership interest holder, or administrator, of such for advice relating to such Conduit Purchaser’s operation.
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(b) All payments made by the Seller to the Administrator, any Purchaser Agent, any Purchaser, Liquidity Provider or other Program Support Provider hereunder shall be made without withholding for or on account of any present or future taxes (other than those imposed or based on the gross or net income or receipts of the recipient by the jurisdiction under the laws of which such Person is organized, operates or where its principal executive office is located or any political subdivision thereof). If any such withholding is so required, the Seller shall make the withholding, pay the amount withheld to the appropriate authority before penalties attach thereto or interest accrues thereon and pay such additional amount as may be necessary to ensure that the net amount actually received by such Person free and clear of such taxes (including such taxes on such additional amount) is equal to the amount that such Person would have received had such withholding not been made. If any such Person pays any such taxes, penalties or interest the Seller shall reimburse such Person for that payment on demand. If the Seller pays any such taxes, penalties or interest, it shall deliver official tax receipts evidencing that payment or certified copies thereof to such Person on whose account such withholding was made on or before the thirtieth day after payment.
(c) In addition, the Seller shall pay on demand any and all stamp and other taxes and fees payable in connection with the execution, delivery, filing and recording of this Agreement, the other Transaction Documents or the other documents or agreements to be delivered hereunder or thereunder, and agrees to save each Indemnified Party and Affected Person harmless from and against any liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees.
Section 5.5 No Proceedings; Limitation on Payments.
(a) Each of the Seller, ACI, the Servicer, the Administrator, the LC Bank, the Purchaser Agents and the Purchasers and each assignee of the Purchased Interest or any interest therein, and each Person that enters into a commitment to purchase the Purchased Interest or interests therein, hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, any Conduit Purchaser any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and one day after the latest maturing Note issued by such Conduit Purchaser is paid in full. The provisions of this paragraph shall survive any termination of this Agreement.
(b) Each of the Seller, ACI, the Servicer, the Administrator, the LC Bank, the Purchaser Agents and the Purchasers and each assignee of the Purchased Interest or any interest therein, and each Person that enters into a commitment to purchase the Purchased Interest or interests therein, hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, the Seller any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and one day after the Final Payout Date; provided, that the Administrator may take any such action with the prior written consent of the Majority Purchaser Agents and the LC Bank. The provisions of this paragraph shall survive any termination of this Agreement.
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(c) Notwithstanding any provisions contained in this Agreement to the contrary, no Conduit Purchaser shall, or shall be obligated to, pay any amount, if any, payable by it pursuant to this Agreement or any other Transaction Document unless (i) such Conduit Purchaser has received funds which may be used to make such payment and which funds are not required to repay such Conduit Purchaser’s Notes when due and (ii) after giving effect to such payment, either (x) such Conduit Purchaser could issue Notes to refinance all of its outstanding Notes (assuming such outstanding Notes matured at such time) in accordance with the program documents governing such Conduit Purchaser’s securitization program or (y) all such Conduit Purchaser’s Notes are paid in full. Any amount which a Conduit Purchaser does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in §101 of the Bankruptcy Code) against or company obligation of such Conduit Purchaser for any such insufficiency unless and until such Conduit Purchaser satisfies the provisions of clauses (i) and (ii) above. The provisions of this paragraph shall survive any termination of this Agreement.
Section 5.6 Confidentiality.
Unless otherwise required by Applicable Law, each of the Seller and the Servicer agrees to maintain the confidentiality of this Agreement and the other Transaction Documents (and all drafts thereof) in communications with third parties and otherwise; provided, that this Agreement may be disclosed: (a) to third parties to the extent such disclosure is made pursuant to a written agreement of confidentiality in form and substance reasonably satisfactory to the Administrator and each Purchaser Agent, (b) to the Seller’s legal counsel and auditors if they agree to hold it confidential, subject to Applicable Law, (c) in connection with any legal proceeding arising out of or in connection with this Agreement or any other Transaction Document or the preservation or maintenance of that party’s rights hereunder or thereunder, (d) if required to do so by a court of competent jurisdiction whether in pursuance of any procedure for discovering documents or otherwise, (e) pursuant to any law in accordance with which that party is required or accustomed to act (including applicable SEC requirements), (f) to any Governmental Authority, and (g) to any Person in connection with any credit agreement or other financing transaction. The restrictions in the preceding sentence shall not apply to disclosures to any party to this Agreement by any other party hereto, information already known to a recipient otherwise than in breach of this Section, information also received from another source on terms not requiring it to be kept confidential, or information that is or becomes publicly available otherwise than in breach of this Section. Unless otherwise required by Applicable Law, each of the Administrator, the Purchaser Agents and the Purchasers agrees to maintain the confidentiality of non-public financial information regarding ACI, the Seller, the Transferor, the Servicer and the Originators; provided, that such information may be disclosed to: (i) third parties to the extent such disclosure is made pursuant to a written agreement of confidentiality in form and substance reasonably satisfactory to ACI, (ii) legal counsel and auditors of the Purchasers, the Purchaser Agents or the Administrator if they agree to hold it confidential, (iii) any nationally recognized statistical rating organization or if applicable, the Rating Agencies rating the Notes of any Conduit Purchaser, (iv) any Program Support Provider or potential Program Support Provider (if they agree to hold it confidential), (v) any placement agency placing the Notes and (vi) any regulatory authorities or Governmental Authority having jurisdiction over the Administrator, any Purchaser Agent, any Purchaser, any Program Support Provider or any Liquidity Provider.
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Section 5.7 GOVERNING LAW AND JURISDICTION.
(a) THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK; AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH SERVICE MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
Section 5.8 Execution in Counterparts.
This Agreement may be executed in any number of counterparts, each of which, when so executed, shall be deemed to be an original, and all of which, when taken together, shall constitute one and the same agreement. Delivery of an executed counterpart hereof by facsimile or other electronic means shall be equally effective as delivery of an originally executed counterpart.
Section 5.9 Survival of Termination; Non-Waiver.
The provisions of Sections 1.7, 1.8, 1.18, 1.19, 3.1, 3.2, 5.4, 5.5, 5.6, 5.7, 5.10 and 5.14 shall survive any termination of this Agreement.
Section 5.10 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES HERETO WAIVES ITS RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. EACH OF THE PARTIES HERETO AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY.
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WITHOUT LIMITING THE FOREGOING, EACH OF THE PARTIES HERETO FURTHER AGREES THAT ITS RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING THAT SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
Section 5.11 Entire Agreement.
This Agreement and the other Transaction Documents embody the entire agreement and understanding between the parties hereto, and supersede all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating to the subject matter hereof and thereof.
Section 5.12 Headings.
The captions and headings of this Agreement and any Exhibit, Schedule or Annex hereto are for convenience of reference only and shall not affect the interpretation hereof or thereof.
Section 5.13 Right of Setoff.
Each Secured Party is hereby authorized (in addition to any other rights it may have) to setoff, appropriate and apply (without presentment, demand, protest or other notice which are hereby expressly waived) any deposits and any other indebtedness held or owing by such Secured Party (including by any branches or agencies of such Secured Party) to, or for the account of, (i) the Seller against amounts owing by the Seller hereunder (even if contingent or unmatured) and (ii) the Servicer against amounts owing by the Servicer hereunder (even if contingent or unmatured); provided that such Secured Party shall notify the Seller or the Servicer, as applicable, promptly following such setoff; provided further, that no Secured Party shall exercise any setoff against the Servicer pursuant to this Agreement with respect to any deposits of the Servicer held by such Secured Party, if such exercise is in contravention of any deposit account control agreement or other similar agreement with the Servicer that is then in effect and to which such Secured Party or an Affiliate of such Secured Party is a party in the capacity of the bank maintaining the Servicer’s relevant account.
Section 5.14 Purchaser Groups’ Liabilities.
The obligations of each Purchaser Agent and each Purchaser under the Transaction Documents are solely the corporate obligations of such Person. No recourse shall be had for any obligation or claim arising out of or based upon any Transaction Document against any member, employee, officer, director or incorporator of any such Person; provided, however, that this Section shall not relieve any such Person of any liability it might otherwise have for its own gross negligence or willful misconduct.
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Section 5.15 Sharing of Recoveries.
Each Purchaser agrees that if it receives any recovery, through set-off, judicial action or otherwise, on any amount payable or recoverable hereunder in a greater proportion than should have been received hereunder or otherwise inconsistent with the provisions hereof, then the recipient of such recovery shall purchase for cash an interest in amounts owing to the other Purchasers (as return of Capital or otherwise), without representation or warranty except for the representation and warranty that such interest is being sold by each such other Purchaser free and clear of any Adverse Claim created or granted by such other Purchaser, in the amount necessary to create proportional participation by the Purchaser in such recovery. If all or any portion of such amount is thereafter recovered from the recipient, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.
Section 5.16 USA Patriot Act.
Each of the Administrator and each of the other Secured Parties hereby notifies the Seller and the Servicer that pursuant to the requirements of the USA Patriot Act, the Administrator and the other Secured Parties may be required to obtain, verify and record information that identifies the Seller, the Originators, the Transferor, the Servicer and the Performance Guarantor, which information includes the name, address, tax identification number and other information regarding the Seller, the Originators, the Transferor, the Servicer and the Performance Guarantor that will allow the Administrator and the other Secured Parties to identify the Seller, the Originators, the Transferor, the Servicer and the Performance Guarantor in accordance with the USA Patriot Act. This notice is given in accordance with the requirements of the USA Patriot Act. Each of the Seller and the Servicer agrees to provide the Administrator and each other Secured Parties, from time to time, with all documentation and other information required by bank regulatory authorities under “know your customer” and anti-money laundering rules and regulations, including, without limitation, the USA Patriot Act.
Section 5.17 Tax Matters.
(a) It is the intention of the parties hereto that for U.S. federal, state and local income and franchise tax purposes, each Purchase is not treated as a sale of the Purchased Interest or otherwise.
(b) The Administrator, on Seller’s behalf, shall maintain a register for the recordation of the names and addresses of the Purchasers, and the Purchases (and Discount, fees and other similar amounts under this Agreement) pursuant to the terms hereof from time to time (the “Register”), including any assignee. The entries in the Register shall be conclusive absent manifest error, and to the extent applicable, the parties hereto shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a lender solely for U.S. federal income tax purposes. The Register shall be available for inspection by each Purchaser, at any reasonable time and from time to time upon reasonable prior notice.
Section 5.18 Severability.
Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
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Section 5.19 Mutual Negotiations.
This Agreement and the other Transaction Documents are the product of mutual negotiations by the parties thereto and their counsel, and no party shall be deemed the draftsperson of this Agreement or any other Transaction Document or any provision hereof or thereof or to have provided the same. Accordingly, in the event of any inconsistency or ambiguity of any provision of this Agreement or any other Transaction Document, such inconsistency or ambiguity shall not be interpreted against any party because of such party’s involvement in the drafting thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.
| ARCH RECEIVABLE COMPANY, LLC, as Seller | ||
| By: | ||
| Name: | ||
| Title: |
| Address: |
One CityPlace Drive, Suite 300 St. Louis, MO 63141 | |
| Attention: | Robert G. Jones | |
| Telephone: | 314-994-2716 | |
| Facsimile: | 314-994-2736 | |
| Email: | bjones@archcoal.com | |
| ARCH COAL SALES COMPANY, INC., as initial Servicer | ||
| By: | ||
| Name: | ||
| Title: |
| Address: |
One CityPlace Drive, Suite 300 St. Louis, MO 63141 | |
| Attention: | Robert G. Jones | |
| Telephone: | 314-994-2716 | |
| Facsimile: | 314-994-2736 | |
| Email: | bjones@archcoal.com | |
| S-1 | Third A&R RPA (Arch) |
| PNC BANK, NATIONAL ASSOCIATION, as Administrator | ||
| By: | ||
| Name: | Michael Brown | |
| Title: | Senior Vice President | |
| Address: | PNC Bank, National Association 300 Fifth Avenue | |
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
| Attention: | Brian Stanley | |
| Telephone: | 412-768-2001 | |
| Facsimile: | 412-768-5151 | |
| S-2 | Third A&R RPA (Arch) |
| PNC BANK, NATIONAL ASSOCIATION, as a Related Committed Purchaser | ||
| By: | ||
| Name: | Michael Brown | |
| Title: | Senior Vice President | |
| Address: | PNC Bank, National Association 300 Fifth Avenue | |
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
| Attention: | Brian Stanley | |
| Telephone: | 412-768-2001 | |
| Facsimile: | 412-768-5151 | |
| S-3 | Third A&R RPA (Arch) |
| PNC BANK, NATIONAL ASSOCIATION, as the LC Bank and as an LC Participant | ||
| By: | ||
| Name: | Michael Brown | |
| Title: | Senior Vice President | |
| Address: | PNC Bank, National Association 300 Fifth Avenue | |
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
| Attention: | Brian Stanley | |
| Telephone: | 412-768-2001 | |
| Facsimile: | 412-768-5151 | |
| S-4 | Third A&R RPA (Arch) |
| PNC BANK, NATIONAL ASSOCIATION, as a Purchaser Agent | ||
| By: | ||
| Name: | Michael Brown | |
| Title: | Senior Vice President | |
| Address: | PNC Bank, National Association 300 Fifth Avenue | |
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
| Attention: | Brian Stanley | |
| Telephone: | 412-768-2001 | |
| Facsimile: | 412-768-5151 | |
| S-5 | Third A&R RPA (Arch) |
| REGIONS BANK, as a Purchaser Agent | ||
| By: | ||
| Name: | ||
| Title: | ||
| Address: |
Regions Bank 1180 West Peachtree Street NW | |
| Suite 1000 | ||
| Atlanta, GA 30309 | ||
| Attention: Mark Kassis or Linda Harris | ||
| Telephone: 404-221-4366 or 404-221-4354 | ||
| Facsimile: 404-805-0841 | ||
| REGIONS BANK, as a Related Committed Purchaser | ||
| By: | ||
| Name: | ||
| Title: | ||
| Address: |
Regions Bank 1180 West Peachtree Street NW | |
| Suite 1000 | ||
| Atlanta, GA 30309 | ||
| Attention: Mark Kassis or Linda Harris | ||
| Telephone: 404-221-4366 or 404-221-4354 | ||
| Facsimile: 404-805-0841 | ||
| S-6 | Third A&R RPA (Arch) |
| REGIONS BANK, as an LC Participant | ||
| By: | ||
| Name: | ||
| Title: | ||
| Address: |
Regions Bank 1180 West Peachtree Street NW | |
| Suite 1000 | ||
| Atlanta, GA 30309 | ||
| Attention: Mark Kassis or Linda Harris | ||
| Telephone: 404-221-4366 or 404-221-4354 | ||
| Facsimile: 404-805-0841 | ||
| S-7 | Third A&R RPA (Arch) |
EXHIBIT I
DEFINITIONS
As used in the Agreement (including its Exhibits, Schedules and Annexes), the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined). Unless otherwise indicated, all Section, Annex, Exhibit and Schedule references in this Exhibit are to Sections of and Annexes, Exhibits and Schedules to the Agreement.
“ABL Agent” has the meaning set forth in the definition of Credit Agreement.
“ACI” means Arch Resources, Inc. (f/k/a Arch Coal, Inc.), a Delaware corporation.
“Adjusted LC Participation Amount” means, at any time, the greater of (i) LC Participation Amount less the amount of cash collateral held in the LC Collateral Account at such time and (ii) zero ($0).
“Administration Account” means the account number 1002422076 of the Administrator maintained at the office of PNC at 300 Fifth Avenue, Pittsburgh, Pennsylvania 15222, or such other account as may be so designated in writing by the Administrator to the Servicer.
“Administrator” has the meaning set forth in the preamble to the Agreement.
“Adverse Claim” means any Lien other than a Permitted Lien; it being understood that any Lien in favor of, or assigned to, the Administrator (for the benefit of the Secured Parties) shall not constitute an Adverse Claim.
“Affected Person” has the meaning set forth in Section 1.7 of the Agreement.
“Affiliate” means, as to any Person: (a) any Person that, directly or indirectly, is in control of, is controlled by or is under common control with such Person, or (b) who is a director or officer: (i) of such Person or (ii) of any Person described in clause (a), except that, in the case of each Conduit Purchaser, Affiliate shall mean the holder(s) of its capital stock or membership interests, as the case may be. For purposes of this definition, control of a Person shall mean the power, direct or indirect: (x) to vote 25% or more of the securities having ordinary voting power for the election of directors or managers of such Person, or (y) to direct or cause the direction of the management and policies of such Person, in either case whether by ownership of securities, contract, proxy or otherwise.
“Agents” has the meaning set forth in the definition of Credit Agreement.
“Aggregate Capital” means at any time the aggregate outstanding Capital of all Purchasers at such time.
“Aggregate Discount” means, at any time, the sum of the aggregate for each Purchaser of the accrued and unpaid Discount with respect to each such Purchaser’s Capital at such time.
“Agreement” has the meaning set forth in the preamble to the Agreement.
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“Alternate Rate” means an interest rate per annum selected in accordance with Section 1.23, for any Settlement Period for any Capital (or portion thereof) funded by any Purchaser other than through the issuance of Notes equal to: (a)(i) the Benchmark that is the Term SOFR Rate for such Settlement Period plus the SOFR Adjustment, (ii) the Benchmark that is Daily 1M SOFR for such Settlement Period plus the SOFR Adjustment or (iii) the Base Rate for such Settlement Period; provided, however, that the “Alternate Rate” for any day while a Termination Event exists shall be an interest rate equal to the greater of (i) 3.0% per annum above the Base Rate as in effect on such day and (ii) the “Alternate Rate” as calculated in above.
“Anti-Terrorism Laws” means any applicable laws or regulation relating to terrorism, trade sanctions programs and embargoes, import/export licensing, money laundering or bribery, and any regulation, order, or directive promulgated, issued or enforced pursuant to such applicable laws or regulations, all as amended, supplemented or replaced from time to time.
“Applicable Law” means, with respect to any Person, (x) all provisions of law, statute, treaty, constitution, ordinance, rule, regulation, ordinance, requirement, restriction, permit, executive order, certificate, decision, directive or order of any Governmental Authority applicable to such Person or any of its property and (y) all judgments, injunctions, orders, writs, decrees and awards of all courts and arbitrators in proceedings or actions in which such Person is a party or by which any of its property is bound.
“Arch Group” has the meaning set forth in paragraph 3(c) of Exhibit IV to the Agreement.
“Arch Sales” has the meaning set forth in the preamble to the Agreement.
“Assumption Agreement” means an agreement substantially in the form set forth in Annex F to this Agreement.
“Attorney Costs” means and includes all reasonable fees, costs, expenses and disbursements of (i) prior to the occurrence of a Termination Event, one law firm for the Administrator, the Indemnified Parties and the Secured Parties (and one local law firm in each applicable jurisdiction), taken as a whole, and, in the case of any actual conflict of interest, one additional law firm to the affected parties similarly situated (and one local law firm in each applicable jurisdiction), taken as a whole and (ii) on and after the occurrence of any Termination Event, any law firm or other external counsel and all reasonable disbursements of internal counsel.
“Bankruptcy Code” means the United States Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq.), as amended from time to time.
“Bankruptcy Court” means the United States Bankruptcy Court for the Eastern District of Missouri or such other court as shall have jurisdiction over the Chapter 11 Cases.
I-2
“Base Rate” means, with respect to any Purchaser, for any day, a fluctuating interest rate per annum as shall be in effect from time to time, which rate shall be at all times equal to the highest of:
(a) the rate of interest in effect for such day as publicly announced from time to time by the applicable Purchaser Agent (or applicable Related Committed Purchaser or, in the case of determining the Base Rate for purposes of calculating the Yield Reserve, the Administrator) as its “reference rate” or “prime rate”, as applicable. Such “reference rate” or “prime rate” is set by the applicable Purchaser Agent (or the applicable Related Committed Purchaser or the Administrator) based upon various factors, including such Person’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above or below such announced rate); and
(b) 0.50% per annum above the latest Federal Funds Rate.
“Benefit Plan” means any employee benefit pension plan as defined in Section 3(2) of ERISA in respect of which the Seller, the Transferor, any Originator, ACI or any ERISA Affiliate is, or at any time during the immediately preceding six years was, an “employer” as defined in Section 3(5) of ERISA.
“Business Day” means any day other than a Saturday or Sunday or a legal holiday on which commercial banks are authorized or required by law to be closed for business in Pittsburgh, Pennsylvania or New York City, New York; provided that, for purposes of any direct or indirect calculation or determination involving SOFR, the term “Business Day” means any such day that is also a U.S. Government Securities Business Day.
“Capital” means, with respect to any Purchaser, the aggregate amounts paid to the Seller in connection with Funded Purchases in respect of the Purchased Interest by such Purchaser pursuant to Section 1.2 of the Agreement (including such Purchaser’s Pro Rata Share of the aggregate amount of all unreimbursed draws deemed to be Funded Purchases pursuant to Section 1.2(e)), as reduced from time to time by Collections distributed and applied on account of such Capital pursuant to Section 1.4(d) of the Agreement; provided, that if such Capital shall have been reduced by any distribution and thereafter all or a portion of such distribution is rescinded or must otherwise be returned for any reason, such Capital shall be increased by the amount of such rescinded or returned distribution as though it had not been made.
“Capital Tranche” means specified portions of the Purchases outstanding as follows: (a) any Purchase (or Portions of Capital thereof) for which the applicable Discount is determined by reference to the Term SOFR Rate and which have the same Settlement Period shall constitute one Capital Tranche, (b) all Purchases (or Portions of Capital thereof) for which the applicable Discount is determined by reference to Daily 1M SOFR shall constitute one Capital Tranche, and (c) all Purchases (or Portions of Capital thereof) for which the applicable Discount is determined by reference to Base Rate shall constitute one Capital Tranche.
“Cash Flow Forecast” has the meaning set forth in Section 1(a)(iii) of Exhibit IV.
“Change in Control” means (a) from and after the consummation of the Subject Merger, Core Natural Resources ceases to own, directly or indirectly, 100% of the issued and outstanding capital stock of ACI free and clear of all Adverse Claims (other than any Adverse Claim in favor of either Agent); (b) ACI ceases to own, directly or indirectly, (1) 100% of the issued and outstanding capital stock of Arch Sales free and clear of all Adverse Claims (other than any Adverse Claim in favor of either Agent), (2) 100% of the issued and outstanding
I-3
capital stock or other equity interests of each Originator (it being understood that the foregoing clause (2) shall not prohibit the disposition of equity interests in any Originator to
the extent (x) after giving effect to such disposition, the Person so sold is no longer party to the Purchase and Sale Agreement and (y) such disposition is not otherwise prohibited by the Transaction Documents), (3) 100% of each
Company Note free and clear of all Adverse Claims (other than any Adverse Claim in favor of either Agent (so long as such Person is then party to a No Proceedings Agreement) or (4) 100% of the membership interests of the Seller free and clear
of all Adverse Claims (other than any Adverse Claim in favor of either Agent (so long as such Person is then party to a No Proceedings Agreement); or (bc) any person or group of persons (within
the meaning of Sections 13(d) or 14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the SEC under said Act) 35% or more of the voting capital
stock of ACICore Natural Resources;
or (cd) within a period of
twelve (12) consecutive calendar months, individuals who (1) were directors of
ACICore Natural Resources on the
first day of such period, (2) were nominated for election by the
ACICore Natural Resources, or (3) were approved for appointment by the board shall cease to
constitute a majority of the board of directors of
ACICore Natural Resources; provided
that the appointment of any directors of ACI pursuant to the Plan of
ReorganizationCore Natural Resources in connection with the Subject Merger shall not result in a Change
of Control. Notwithstanding the foregoing, the occurrence of the Subject Merger shall not constitute a Change in Control so long as
it is undertaken in accordance with the Subject Merger Agreement. Notwithstanding anything to the contrary herein or in any other Transaction Document, for purposes of this definition, “Agent” shall have the meaning given to such term in
that certain Credit Agreement, dated as of November 28, 2017, by and among Core Natural Resources, as borrower, the guarantors thereunder, the lenders thereunder, PNC Bank, National Association, as administrative agent, PNC Bank, National
Association, as collateral agent and the joint lead arrangers and joint bookrunners party thereto, as extended, renewed, amended, amended and restated, supplemented or otherwise modified.
“Chapter 11 Cases” means the Chapter 11 cases of ACI and all of its Subsidiaries jointly administered under Case No. 16-40120-705 in the U.S. Bankruptcy Court for the Eastern District of Missouri.
“Chapter 11 Debtors” means ACI and certain of its Subsidiaries that are debtors in any of the Chapter 11 Cases.
“Chapter 11 Obligor” means, at any time, an Obligor that either (a) is a debtor in a case commenced under Chapter 11 of the Bankruptcy Code and for which such case has not been converted to Chapter 7 of the Bankruptcy Code or (b) is a resident of Canada and is subject to an Insolvency Proceeding.
“Chapter 11 Obligor Receivable” means, at any time, any Receivable the Obligor of which is a Chapter 11 Obligor.
“Closing Date” means October 5, 2016.
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“Collections” means, with respect to any Pool Receivable: (a) all funds that are received by any Originator, the Transferor, ACI, the Seller or the Servicer in payment of any amounts owed in respect of such Receivable (including purchase price, finance charges, interest and all other charges), or applied to amounts owed in respect of such Receivable (including insurance payments and net proceeds of the sale or other disposition of repossessed goods or other collateral or property of the related Obligor or any other Person directly or indirectly liable for the payment of such Pool Receivable and available to be applied thereon), (b) all amounts deemed to have been received pursuant to Section 1.4(e) of the Agreement, (c) all other proceeds of such Pool Receivable (including payments by guarantors and drawings under any Eligible Supporting Letter of Credit or any other letter of credit in favor of any Originator, the Seller or the Servicer with respect to such Receivable), and (d) all amounts paid by or on behalf of a Credit Insurer under any Credit Insurance Policy or in respect of any claim thereunder.
“Commitment” means, with respect to any Related Committed Purchaser, LC Participant or LC Bank, as applicable, the maximum aggregate amount which such Purchaser is obligated to pay hereunder on account of all Funded Purchases and all drawings under all Letters of Credit, on a combined basis, as set forth on Schedule IV or in the Assumption Agreement or other agreement pursuant to which it became a Purchaser, as such amount may be modified in connection with any subsequent assignment pursuant to Section 5.3 or in connection with a change in the Purchase Limit pursuant to Section 1.1(b) of the Agreement). For the avoidance of doubt, in no event shall the sum of the aggregate Commitments of all Purchasers in a Purchaser Group exceed such Purchaser Group’s Group Commitment.
“Commitment Percentage” means, for each Related Committed Purchaser or related LC Participant in a Purchaser Group, the Commitment of such Related Committed Purchaser or related LC Participant, as the case may be, divided by the total of all Commitments of all Related Committed Purchasers or related LC Participants, as the case may be, in such Purchaser Group.
“Commodity Hedge” means a price protection agreement: (i) related to crude oil, diesel fuel, heating oil, coal, SO2 allowances or other commodities used in the ordinary course of business of ACI and its Affiliates and (ii) entered into by ACI and its Affiliates for hedging purposes in the ordinary course of the operations of their business.
“Company Note” has the meaning set forth in Section 3.1 of the Sale and Contribution Agreement.
“Concentration Percentage” means: (a) except as provided in clause (b) below, (i) for any Group A Obligor, 25%, (ii) for any Group B Obligor, 20%, (iii) for any Group C Obligor, 10% and (iv) for any Group D Obligor, 5%, and (b) for each of the Obligors listed in the chart below (each, a “Special Obligor”), the percentage specified in the chart below for such Special Obligor (the applicable “Special Concentration Limit”); provided, however, that the Administrator (with the prior written consent of the Majority Purchaser Agents) may approve higher “Concentration Percentages” for selected Obligors; provided, further, that the Administrator may (or, at the direction of the Majority Purchaser Agents shall), upon not less than five (5) Business Days’ notice to the Seller, (i) solely with respect to ArcelorMittal S.A., and its Subsidiaries, cancel or reduce the Special Concentration Limit in the event that ArcelorMittal S.A.’s long-term debt rating falls below investment grade or (ii) with respect to any other Special Obligors, cancel or reduce the Special Concentration Limit, and in each case, the Concentration Percentage for such Special Obligor(s) shall be determined pursuant to clause (a) above (or if reduced, shall be no less than the
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percentage determined pursuant to clause (a) above). In the event that any other Obligor is or becomes an Affiliate of a Special Obligor, the Special Concentration Limit shall apply to both such Obligor and such Special Obligor and shall be calculated as if such Obligor and such Special Obligor were a single Obligor.
| Special Obligor |
Special Concentration Limit |
|||
| ArcerlorMittal S.A., and Subsidiaries |
15 | % | ||
“Concentration Reserve” means at any time, the product of (a) the Aggregate Capital plus the Adjusted LC Participation Amount, and (b)(i) the Concentration Reserve Percentage divided by (ii) 1 minus the Concentration Reserve Percentage.
“Concentration Reserve Percentage” means, at any time, the largest of the following: (i) the sum of the five (5) largest Obligor Percentages of Group D Obligors, (ii) the sum of the three (3) largest Obligor Percentages of Group C Obligors, (iii) the sum of the two (2) largest Obligor Percentages of Group B Obligors and (iv) the largest Obligor Percentage of Group A Obligors; provided, that, for purposes of determining the Concentration Reserve Percentage, with respect to any Eligible Receivable that is supported by an Eligible Supporting Letter of Credit or any Eligible Receivable that is an Insured Designated Receivable, the “Obligor” thereof (including for purposes of determining such Obligor’s Obligor Percentage and status as a Group A Obligor, Group B Obligor, Group C Obligor or Group D Obligor) shall be deemed to be the related Eligible Supporting Letter of Credit Provider or Eligible Credit Insurance Provider, as applicable; provided, further that (x) if any Pool Receivable is partially supported by an Eligible Supporting Letter of Credit, then the “Obligor” thereof shall be deemed to be (i) with respect to the Unsupported Outstanding Balance of such Pool Receivable, the Obligor of such Pool Receivable and (ii) with respect to the Supported Outstanding Balance of such Pool Receivable, the related Eligible Supporting Letter of Credit Provider and (y) with respect to any Eligible Receivable that is an Insured Designated Receivable, the “Obligor” thereof shall be deemed to be (i) with respect to the Insured Amount of such Insured Designated Receivable, the related Eligible Credit Insurance Provider and (ii) with respect to the remaining Outstanding Balance of such Insured Designated Receivable, the Obligor of such Insured Receivable.
“Conduit” has the meaning set forth in Section 5.3(c) of the Agreement.
“Conduit Purchaser” means each commercial paper conduit that is a party to this Agreement, as a purchaser, or that becomes a party to this Agreement as a purchaser pursuant to an Assumption Agreement or otherwise.
“Confirmation Order” means the final order confirming the Plan of Reorganization entered by the Bankruptcy Court on September 13, 2016, which, among other things, approves the transactions described in this Agreement and the other Transaction Documents.
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“Conforming Changes” means, with respect to Daily 1M SOFR, the Term SOFR Rate or any Benchmark Replacement in relation thereto, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Business Day,” the definition of “Yield Period,” the definition of “Settlement Period”, the definition of “U.S. Government Securities Business Day,” timing and frequency of determining rates and the timing of making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, and other technical, administrative or operational matters) that the Administrator, in consultation with the Seller, decides may be appropriate to reflect the adoption and implementation of Daily 1M SOFR, the Term SOFR Rate or such Benchmark Replacement and to permit the administration thereof by the Administrator in a manner substantially consistent with market practice (or, if the Administrator decides that adoption of any portion of such market practice is not administratively feasible or if the Administrator determines that no market practice for the administration of Daily 1M SOFR, the Term SOFR Rate or the Benchmark Replacement exists, in such other manner of administration as the Administrator decides is reasonably necessary in connection with the administration of this Agreement and the other Transaction Documents).
“Contract” means, with respect to any Receivable, any and all contracts, instruments, agreements, leases, invoices, notes or other writings pursuant to which such Receivable arises or that evidence such Receivable or under which an Obligor becomes or is obligated to make payment in respect of such Receivable.
“Core Natural Resources” means Core Natural Resources, Inc. (formerly known as CONSOL Energy Inc.).
“Covered Entity” means (a) the Seller, the Servicer, the Performance Guarantor, the Transferor and each Originator and (b) each Person that, directly or indirectly, is in control of a Person described in clause (a) above. For purposes of this definition, control of a Person shall mean the direct or indirect (x) ownership of, or power to vote, 25% or more of the issued and outstanding equity interests having ordinary voting power for the election of directors of such Person or other Persons performing similar functions for such Person, or (y) power to direct or cause the direction of the management and policies of such Person whether by ownership of equity interests, contract or otherwise.
“CP Rate” means, for any Conduit Purchaser and for any Settlement Period for any Portion of Capital (a) the per annum rate equivalent to the weighted average cost (as determined by the applicable Purchaser Agent and which shall include commissions of placement agents and dealers, incremental carrying costs incurred with respect to Notes of such Person maturing on dates other than those on which corresponding funds are received by such Conduit Purchaser, other borrowings by such Conduit Purchaser (other than under any Program Support Agreement) and any other costs associated with the issuance of Notes) of or related to the issuance of Notes that are allocated, in whole or in part, by the applicable Conduit Purchaser to fund or maintain such Portion of Capital (and which may be also allocated in part to the funding of other assets of such Conduit Purchaser); provided, however, that if any component of such rate is a discount rate, in calculating the “CP Rate” for such Portion of Capital for such Settlement Period, the applicable Purchaser Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum; provided, further, that notwithstanding
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anything in this Agreement or the other Transaction Documents to the contrary, the Seller agrees that any amounts payable to Conduit Purchasers in respect of Discount for any Settlement Period with respect to any Portion of Capital funded by such Conduit Purchasers at the CP Rate shall include an amount equal to the portion of the face amount of the outstanding Notes issued to fund or maintain such Portion of Capital that corresponds to the portion of the proceeds of such Notes that was used to pay the interest component of maturing Notes issued to fund or maintain such Portion of Capital, to the extent that such Conduit Purchaser had not received payments of interest in respect of such interest component prior to the maturity date of such maturing Notes (for purposes of the foregoing, the “interest component” of Notes equals the excess of the face amount thereof over the net proceeds received by such Conduit Purchaser from the issuance of Notes, except that if such Notes are issued on an interest-bearing basis its “interest component” will equal the amount of interest accruing on such Notes through maturity) or (b) any other rate designated as the “CP Rate” for such Conduit Purchaser in an Assumption Agreement or Transfer Supplement or other document pursuant to which such Person becomes a party as a Conduit Purchaser to this Agreement, or any other writing or agreement provided by such Conduit Purchaser to the Seller, the Servicer and the applicable Purchaser Agent from time to time. The “CP Rate” for any day while a Termination Event or an Unmatured Termination Event exists shall be an interest rate equal to the greater of (a) 3.0% per annum above the Base Rate as in effect on such day and (b) the Alternate Rate as calculated in the definition thereof.
“Credit Agreement” means (i) that certain Term Loan Credit Agreement, dated as of February 8, 2024 (as
extended, renewed, amended, amended and restated, supplemented or otherwise modified, the “Original Term Loan Credit Agreement”), by and among ACI, PNC Capital Markets LLC, as sole lead arranger and sole bookrunner, the lenders from
time to time party thereto, and PNC, as administrative agent (in such capacities, together with its successors, the “Original Term Loan Agent” and, together with the administrative agent or collateral agent under any other agreement
referred to in clause (iii) below, the “Term Loan Agent”), (ii) that certain Credit Agreement, dated as of April 27, 2017 (as extended, renewed, amended, amended and restated, supplemented or otherwise modified, the
“Original ABL Credit Agreement”), by and among ACI, the lenders from to time party thereto, and Regions Bank, as administrative agent (in such capacity, together with its successors, the “Original ABL Agent” and,
together with the administrative agent or collateral agent under any other agreement referred to in clause (iii) below, the “ABL Agent”; the ABL Agent together with the Term Loan Agent, the “Agents”), or
(iii) any other loan agreement, credit agreement, indenture or other agreement from time to time entered into by ACI, any Originator and/or any Affiliate thereof in connection with the incurrence or issuance of Debt (or commitments in respect
thereof) in exchange or replacement for or to refinance the Original Term Loan Credit Agreement or the Original ABL Credit Agreement, in each case, in whole or in part, whether or not with the same or different lenders, arrangers, agents or other
investors and whether with a larger or smaller aggregate principal amount and/or a longer or shorter maturity, that provides for or is secured by, in whole or in part, among other things, a mortgage, security interest or other Adverse Claim on any
interest in real property or as-extracted collateral (or any proceeds thereof) of any Originator related to such Originator’s mining operations or a minehead.; provided, that, in the event any Credit Agreement is terminated or repaid in full, any reference thereto in this Agreement shall be deemed
to be a reference to such Credit Agreement as in effect immediately prior to such termination or repayment in full.
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“Credit and Collection Policy” means, as the context may require, those receivables credit and collection policies and practices of the Originators and the Transferor in effect on the Closing Date and described in Schedule I to the Agreement, as modified in compliance with the Agreement.
“Credit Insurance Policy” means a credit insurance policy naming the Seller as insured and the Administrator as an additional insured or a loss payee, which policy insures the payment of Pool Receivables owing by one or more Obligors.
“Credit Insurer” means each insurance company that provides a Credit Insurance Policy to the Seller.
“Cut-off Date” has the meaning set forth in the Sale Agreements.
“Daily 1M SOFR” means, for any day, the rate per annum determined by the applicable Purchaser Agent by dividing (the resulting quotient rounded upwards, at such Purchaser Agent’s discretion, to the nearest 1/100th of 1%) (a) the Term SOFR Reference Rate for such day for a term of the Yield Period, as published by the Term SOFR Administrator, by (b) a number equal to 1.00 minus the SOFR Reserve Percentage; provided, that if Daily 1M SOFR, determined as provided above, would be less than the SOFR Floor, then Daily 1M SOFR shall be deemed to be the SOFR Floor. The rate of interest will be adjusted automatically as of each Business Day based on changes in Daily 1M SOFR without notice to the Seller.
“Daily Report” has the meaning set forth in Section 1(a)(ii) of Exhibit IV to this Agreement.
“Daily Simple SOFR” means, for any day (a “SOFR Rate Day”), the interest rate per annum determined by the applicable Purchaser Agent by dividing (the resulting quotient rounded upwards, at such Purchaser Agent’s discretion, to the nearest 1/100th of 1%) (A) SOFR for the day (the “SOFR Determination Date”) that is 2 Business Days prior to (i) such SOFR Rate Day if such SOFR Rate Day is a Business Day or (ii) the Business Day immediately preceding such SOFR Rate Day if such SOFR Rate Day is not a Business Day, by (B) a number equal to 1.00 minus the SOFR Reserve Percentage, in each case, as such SOFR is published by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source identified by the Federal Reserve Bank of New York or its successor administrator for the secured overnight financing rate from time to time. If Daily Simple SOFR as determined above would be less than the SOFR Floor, then Daily Simple SOFR shall be deemed to be the SOFR Floor. If SOFR for any SOFR Determination Date has not been published or replaced with a Benchmark Replacement by 5:00 p.m. (Pittsburgh, Pennsylvania time) on the second Business Day immediately following such SOFR Determination Date, then SOFR for such SOFR Determination Date will be SOFR for the first Business Day preceding such SOFR Determination Date for which SOFR was published in accordance with the definition of “SOFR”; provided that SOFR determined pursuant to this sentence shall be used for purposes of calculating Daily Simple SOFR for no more than 3 consecutive SOFR Rate Days. If and when Daily Simple SOFR as determined above changes, any applicable rate of interest based on Daily Simple SOFR will change automatically without notice to the Seller, effective on the date of any such change.
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“Days’ Sales Outstanding” means, for any calendar month, an amount computed as of the last day of such calendar month equal to: (a) the average of the Outstanding Balance of all Pool Receivables as of the last day of each of the three most recent calendar months ended on the last day of such calendar month divided by (b) (i) the aggregate credit sales made by the Originators and the Transferor during the three calendar months ended on the last day of such calendar month, divided by (ii) 90.
“Debt” means, as to any Person at any time, any and all indebtedness, obligations or liabilities (whether matured or unmatured, liquidated or unliquidated, direct or indirect, absolute or contingent, or joint or several) of such Person for or in respect of: (i) borrowed money, (ii) amounts raised under or liabilities in respect of any bonds, debentures, notes, note purchase, acceptance or credit facility, or other similar instruments or facilities, (iii) reimbursement obligations (contingent or otherwise) under any letter of credit, (iv) any other transaction (including production payments (excluding royalties), installment purchase agreements, forward sale or purchase agreements, capitalized leases and conditional sales agreements) having the commercial effect of a borrowing of money entered into by such Person to finance its operations or capital requirements (but not including trade payables and accrued expenses incurred in the ordinary course of business which are not represented by a promissory note or other evidence of indebtedness), or (v) any Guaranty of any such Debt. It is understood that obligations in respect of any Hedging Transaction shall not be deemed to be Debt.
“Declining Conduit Purchaser” has the meaning set forth in Section 1.4(b)(ii) of this Agreement.
“Declining Notice” has the meaning set forth in Section 1.4(b)(ii) of this Agreement.
“Default Ratio” means the ratio (expressed as a percentage and rounded to the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each calendar month by dividing: (a) the aggregate Outstanding Balance of all Pool Receivables that became Defaulted Receivables during such month; provided, however, that such amount may, from time to time, exclude the aggregate Outstanding Balance of Eligible Chapter 11 Receivables if consented to in writing by the Administrator and the Majority Purchaser Agents by (b) the aggregate credit sales made by the Originators and the Transferor during the month that is seven calendar months before such month.
“Defaulted Receivable” means a Receivable:
(a) as to which any payment, or part thereof, remains unpaid for more than 150 days from the original due date for such payment, or
(b) without duplication (i) so long as such Receivable is not an Eligible Chapter 11 Receivable, as to which an Insolvency Proceeding shall have occurred with respect to the Obligor thereof or any other Person obligated thereon or owning any Related Security with respect thereto, (ii) that has been written off the applicable Originator’s, the Seller’s or the Transferor’s books as uncollectible or (iii) that, consistent with the Credit and Collection Policy, should be written off the applicable Originator’s, the Seller’s or the Transferor’s books as uncollectible;
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provided, however, that for purposes of calculating the Default Ratio, no Receivable will be deemed to have become a Defaulted Receivable more than once.
“Delinquency Ratio” means the ratio (expressed as a percentage and rounded to the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each calendar month by dividing: (a) the aggregate Outstanding Balance of all Pool Receivables that were Delinquent Receivables on such day by (b) the aggregate Outstanding Balance of all Pool Receivables on such day.
“Delinquent Receivable” means a Receivable as to which any payment, or part thereof, remains unpaid for more than 60 days from the original due date for such payment.
“Dilution Horizon” means, for any calendar month, the ratio (expressed as a percentage and rounded to the nearest 1/100th of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of such calendar month of: (a) the aggregate credit sales made by the Originators and the Transferor during the two most recent calendar months to (b) the Net Receivables Pool Balance at the last day of the most recent calendar month.
“Dilution Ratio” means the ratio (expressed as a percentage and rounded to the nearest 1/100th of 1%, with 5/1000th of 1% rounded upward), computed as of the last day of each calendar month by dividing: (a) the aggregate amount of payments made or owed by the Seller pursuant to Section 1.4(e)(i) of the Agreement during such calendar month by (b) the aggregate credit sales made by the Originators and the Transferor during the calendar month that is one month prior to such calendar month.
“Dilution Reserve” means, on any day, an amount equal to: (a) the sum of the Aggregate Capital plus the Adjusted LC Participation Amount at the close of business of the Servicer on such day multiplied by (b) (i) the Dilution Reserve Percentage on such day, divided by (ii) 100% minus the Dilution Reserve Percentage on such day.
“Dilution Reserve Percentage” means, on any day, the product of (a) the Dilution Horizon multiplied by (b) the sum of (i) 2.5 times the average of the Dilution Ratios for the twelve most recent calendar months and (ii) the Spike Factor.
“Discount” means, with respect to any Purchaser:
(a) for any Portion of Capital for any Settlement Period with respect to any Purchaser to the extent such Portion of Capital will be funded by such Purchaser during such Settlement Period through the issuance of Notes:
CPR x C x ED/360
(b) for any Portion of Capital for any Settlement Period with respect to any Purchaser to the extent such Portion of Capital will not be funded by such Purchaser during such Settlement Period through the issuance of Notes or, if the LC Bank and/or any LC Participant has made, or has deemed to have made, a Funded Purchase in connection with any drawing under a Letter of Credit which accrues Discount pursuant to Section 1.2(e) of the Agreement:
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AR x C x ED/Year + TF
where:
| AR | = | the Alternate Rate for such Portion of Capital for such Settlement Period with respect to such Purchaser, | ||
| C | = | the Portion of Capital during such Settlement Period with respect to such Purchaser, | ||
| CPR | = | the CP Rate for the Portion of Capital for such Settlement Period with respect to such Purchaser, | ||
| ED | = | the actual number of days during such Settlement Period, | ||
| Year | = | if such Portion of Capital is funded based upon: (i) SOFR, 360 days, and (ii) the Base Rate, 365 or 366 days, as applicable, and | ||
| TF | = | the Termination Fee, if any, for the Portion of Capital for such Settlement Period with respect to such Purchaser; | ||
provided, that no provision of the Agreement shall require the payment or permit the collection of Discount in excess of the maximum permitted by Applicable Law; and provided further, that Discount for any Portion of Capital shall not be considered paid by any distribution to the extent that at any time all or a portion of such distribution is rescinded or must otherwise be returned for any reason.
“Drawing Date” has the meaning set forth in Section 1.14 of the Agreement.
“Eligible Assignee” means any bank or financial institution acceptable to the LC Bank and the Administrator.
“Eligible Chapter 11 Receivable” means, at any time, any Chapter 11 Obligor Receivable for which both (a) either (I) a final order has been entered by the applicable United States Bankruptcy Court having jurisdiction over the related Chapter 11 Obligor (x) authorizing and approving assumption of the Contract that gave rise to such Chapter 11 Obligor Receivable, (y) authorizing the related Chapter 11 Obligor to perform (prior to assumption) post-petition under the terms of the Contract that gave rise to such Chapter 11 Obligor Receivable or (z) providing for a critical vendor order authorizing payment of such Chapter 11 Obligor Receivable to the extent such Receivable arises with respect to shipments of coal occurring pre-petition and, in each case, such order has not been subsequently stayed, reversed or vacated or (II) the related Obligor of which is a resident of Canada and (b) the Administrator and the Majority Purchaser Agents have in their sole and absolute discretion provided written consent to the Seller that such Chapter 11 Obligor Receivable shall constitute an “Eligible Chapter 11 Receivable”; provided, however, that the Administrator or the Majority Purchaser Agents may, upon not less than five (5) Business Days’ notice to the Seller, cancel any or all designations of Chapter 11 Obligor Receivables as Eligible Chapter 11 Receivables and thereafter such Chapter 11 Obligor Receivable(s) shall not constitute Eligible Chapter 11 Receivables for purposes of this Agreement or any other Transaction Document.
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“Eligible Credit Insurance” means a Credit Insurance Policy issued by an Eligible Credit Insurance Provider, which policy (a) is a Credit Insurance Policy that the Administrator and the Purchaser Agents (in their sole discretion) have agreed in writing constitutes “Eligible Credit Insurance,” (b) such Credit Insurance Policy’s designation as “Eligible Credit Insurance” has not been revoked in writing by the Administrator or any Purchaser Agent; provided that any such designation may only be revoked at a time when the long-term unsecured and uncredit-enhanced senior debt obligation of the related Eligible Credit Insurance Provider is withdrawn or falls below a rating of (i) “AA-” by Standard & Poor’s, or (ii) “Aa3” by Moody’s, (c) is in full force and effect and is the legal, valid and binding obligation of the related Eligible Credit Insurance Provider, and (d) with respect to which, all due and payable premiums have been paid in full. For the avoidance of doubt, if the Credit Insurer of such a Credit Insurance Policy ceases to be an Eligible Credit Insurance Provider, such policy shall cease to constitute Eligible Credit Insurance.
“Eligible Credit Insurance Provider” means an insurance company in the business of issuing commercial credit insurance (a) which company is not an Affiliate of ACI, the Transferor, the Servicer or any other Originator, (b) which is not a Sanctioned Person, and (c) with respect to which, it has not had any credit rating assigned by any of Moody’s, Standard Poor’s or A.M. Best Company, Inc. to it reduced by two or more ratings “notches” since the time any Credit Insurance Policy written by such Credit Insurer became Eligible Credit Insurance hereunder.
“Eligible Foreign Obligor” means an Obligor which is a resident of any country (other than the United States of America) that is not a Sanctioned Country.
“Eligible Receivable” means, at any time, a Pool Receivable:
(a) the Obligor of which is: (i) (A) United States resident or (B) an Eligible Foreign Obligor; (ii) not (A) a United States Federal Government Authority or (B) a governmental entity within the State of Ohio; provided that TVA shall not be subject to the restriction set forth in clause (ii)(A) above; (iii) (A) not subject to any Insolvency Proceeding or (B) the Obligor of an Eligible Chapter 11 Receivable; (iv) not an Affiliate of ACI, the Transferor, the Servicer or any other Originator; and (v) not a natural person (in each case, unless consented to in writing by the Administrator and the Majority Purchaser Agents); provided that, with respect to clauses (i) and (iii) above, in respect of any Pool Receivable that either (x) is fully supported by an Eligible Supporting Letter of Credit or (y) is an Insured Designated Receivable and substantially all of the Outstanding Balance thereof is an Insured Amount, the “Obligor” thereof shall be deemed to be the related Eligible Supporting Letter of Credit Provider or Eligible Credit Insurance Provider, as applicable, and such Obligor shall be deemed to be organized under the laws of the country in which the office from which it is obligated to make payment with respect to such Eligible Supporting Letter of Credit or Eligible Credit Insurance is located;
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(b) that is denominated and payable only in U.S. dollars in the United States, and the Obligor with respect to which has been instructed to remit Collections in respect thereof to a Lock-Box Account (or so long as the Exception Account Conditions are then satisfied, an Exception Account) in the United States of America;
(c) the Obligor of which is not a Sanctioned Person;
(d) that arises under a duly authorized Contract for the sale and delivery of goods or services in the ordinary course of the applicable Originator’s or the Transferor’s business;
(e) that arises under a duly authorized Contract that is in full force and effect and that is a legal, valid and binding obligation of the related Obligor, enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforceability of creditors’ rights generally or limiting the right of specific performance;
(f) that, together with the Contract related thereto, conforms in all material respects with all Applicable Laws;
(g) that is not the subject of any asserted dispute, offset, hold back, defense, Adverse Claim or other claim, provided that, with respect to any Pool Receivable which is subject to any such claim, the amount of such Pool Receivable which shall be treated as an Eligible Receivable shall equal the excess of the amount of such Pool Receivable over the amount of such claim asserted by or available to the related Obligor;
(h) that satisfies all applicable requirements of the applicable Credit and Collection Policy;
(i) that, together with the Contract related thereto, has not been modified, waived or restructured since its creation, except as permitted pursuant to Section 4.2 of the Agreement;
(j) in which the Seller owns good and marketable title, free and clear of any Adverse Claims, and that is freely assignable by the Seller (including without any consent of the related Obligor or any Governmental Authority);
(k) for which the Administrator (on behalf of the Secured Parties) shall have a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, and a valid and enforceable first priority perfected security interest therein and in the Related Security and Collections with respect thereto, in each case free and clear of any Adverse Claim;
(l) that constitutes an account as defined in the UCC, and that is not evidenced by instruments or chattel paper;
(m) that is neither a Defaulted Receivable nor a Delinquent Receivable;
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(n) for which neither the Originator thereof, the Transferor, the Seller nor the Servicer has established any offset or netting arrangements with the related Obligor;
(o) for which the sum of the Outstanding Balances of all Receivables of the related Obligor with respect to which any payment, or part thereof, remains unpaid for more than 90 days from the original due date for such payment do not exceed 35.00% of the Outstanding Balance of all such Obligor’s Receivables;
(p) that represents amounts earned and payable by the Obligor that are not subject to the performance of additional services by the Originator thereof or the Transferor;
(q) that (i) does not arise from a sale of accounts made as part of a sale of a business or constitute an assignment for the purpose of collection only, (ii) is not a transfer of a single account made in whole or partial satisfaction of a preexisting indebtedness or an assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract and (iii) is not a transfer of an interest in or an assignment of a claim under a policy of insurance;
(r) that if such Receivable has not yet been billed, the related coal has been shipped within the last 60 days;
(s) that does not have a due date which is more than 90 days after the original invoice date of such Receivable; and
(t) that if such Receivable is a Rio Tinto Receivable, a Rio Tinto Trigger Event has not occurred with respect to any Rio Tinto Receivable (it being understood that upon the occurrence of a Rio Tinto Trigger Event with respect to any Receivable, then on and after such time, no Rio Tinto Receivables, whether or not then in the Receivables Pool prior to such Rio Tinto Trigger Event, shall be an Eligible Receivable).
“Eligible Supporting Letter of Credit” means, with respect to any Pool Receivables of an Obligor, an unconditional (except for any draft or documentation required to be presented as a condition to drawings thereunder), irrevocable standby or commercial letter of credit, in form and substance reasonably acceptable to the Administrator, issued or confirmed by an Eligible Supporting Letter of Credit Provider, which letter of credit (i) supports the payment of such Pool Receivables, (ii) names the Originator of such Pool Receivables as the sole beneficiary thereof, (iii) is payable in U.S. Dollars, (iv) is in full force and effect and is the legal, valid and binding obligation of the related Eligible Supporting Letter of Credit Provider and (v) unless otherwise agreed in writing by the Administrator, by its terms requires proceeds of all drawings thereunder to be sent by the issuer thereof (or, if applicable, the confirming bank) directly to a Lock-Box Account designated therein.
“Eligible Supporting Letter of Credit Provider” means a bank so designated in writing by the Administrator to the Servicer (in the reasonable discretion of the Administrator); provided that at any time after the long-term unsecured and uncredit-enhanced senior debt obligation of such bank is withdrawn or falls below a rating of (a) “BBB-” by Standard & Poor’s, or (b) “Baa3” by Moody’s, the Administrator may revoke (in the sole discretion of the Administrator) any such
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designation by written notice, which revocation shall be effective on the date so designated, and on such effective date, each letter of credit issued or confirmed by such bank shall cease to be an Eligible Supporting Letter of Credit; provided, however, that no bank shall constitute an “Eligible Supporting Letter of Credit Provider” if at any time it is any of the following: (a) a Sanctioned Person or (b) an Affiliate of ACI, the Transferor, the Servicer or any Originator.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any successor statute of similar import, together with the rulings and regulations thereunder, in each case as in effect from time to time. References to sections of ERISA also refer to any successor sections.
“ERISA Affiliate” means: (a) any corporation that is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Internal Revenue Code) as the Seller, the Transferor, any Originator or ACI, (b) a trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the Internal Revenue Code) with the Seller, the Transferor, any Originator or ACI, or (c) a member of the same affiliated service group (within the meaning of Section 414(m) of the Internal Revenue Code) as the Seller, the Transferor, any Originator, ACI, any corporation described in clause (a) or any trade or business described in clause (b).
“Exception Account”: means the deposit account maintained at PNC in the name of Arch Coal Sales Company, Inc. with the following account number: 1082061214.
“Exception Account Conditions” means, as of any date of determination, the satisfaction of each of the following: (a) no Termination Event has occurred and is continuing, (b) all Collections on Pool Receivables received in any Exception Account are then being swept directly to a Collection Account no later than one (1) Business Day following receipt and identification thereof pursuant to a zero account balance arrangement or an automatic daily sweep arrangement established with PNC, (c) each Exception Account is maintained at PNC and subject to a Lock-Box Agreement in favor of the Administrator, (d) no Exception Account is subject to any account control agreement or similar agreement granting (or purporting to grant) any Person (other than the Administrator) “control” (as defined in Section 9-104 of the UCC) over such Exception Account and (e) no amounts other than Collections on Receivables the Obligor of which is Hyundai Steel Company or another Obligor approved in writing by the Administrator in its sole discretion are being deposited in any Exception Account.
“Excess Concentration” means the sum, without duplication, of the following amounts:
(i) the amount by which the Outstanding Balance of Eligible Receivables of each Obligor then in the Receivables Pool exceeds an amount equal to the Concentration Percentage for such Obligor multiplied by the Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(ii) the sum of (a) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool that have a stated maturity which is more than 45 days but not more than 60 days from the original invoice date of such Eligible Receivables exceeds 35% (or solely during a Minimum Liquidity Period, such lesser percentage (not to be reduced below
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10%) from time to time designated by the Administrator or any Purchaser Agent in its sole discretion in a written notice delivered to Seller and each Purchaser Agent) of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool plus (b) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool that have a stated maturity which is more than 60 days after the original invoice date of such Eligible Receivables exceeds 20% (or solely during a Minimum Liquidity Period, such lesser percentage from time to time designated by the Administrator or any Purchaser Agent in its sole discretion in a written notice delivered to Seller and each Purchaser Agent) of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(iii) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool the Obligor of which is a Tier 1 Eligible Foreign Obligor exceeds 40% (or, solely during a Level I Liquidity Trigger Period, 35%) of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(iv) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool the Obligor of which is a Tier 2 Eligible Foreign Obligor exceeds 7% (or, solely during a Level I Liquidity Trigger Period, 3%) of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(v) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool the coal with respect to which has been shipped but not yet billed for more than 30 days but not more than 60 days from shipment exceeds 10% of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(vi) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool the coal with respect to which has been shipped but not yet billed exceeds 50% of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool; plus
(vii) the amount by which the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool the Collections with respect thereto were deposited in an Exception Account exceeds 12.5% (or such lesser percentage from time to time designated by the Administrator or any Purchaser Agent in its sole discretion in a written notice delivered to Seller and each Purchaser Agent) of the aggregate Outstanding Balance of all Eligible Receivables then in the Receivables Pool;
provided, that, for purposes of determining the “Excess Concentration” pursuant to clause (i) above, with respect to any Eligible Receivable that is supported by an Eligible Supporting Letter of Credit or any Eligible Receivable that is an Insured Designated Receivable, the “Obligor” thereof shall be deemed to be the related Eligible Supporting Letter of Credit Provider or Eligible Credit Insurance Provider, as applicable, provided, further that, for purposes of determining the “Excess Concentration” pursuant to clause (iii) or (iv) above, with respect to any Eligible Receivable that is supported by an Eligible Supporting Letter of Credit or any Eligible Receivable that is an Insured Designated Receivable, the “Obligor” thereof shall be deemed to be the related Eligible Supporting Letter of Credit Provider or Eligible Credit Insurance Provider, as applicable (and, with respect to any Eligible Receivable that is supported by an Eligible Supporting Letter of
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Credit or any Eligible Receivable that is an Insured Designated Receivable, such Obligor shall be deemed to be organized under the laws of the country in which the office from which it is obligated to make payment with respect to such Eligible Supporting Letter of Credit or Eligible Credit Insurance is located) and provided, further that (x) if any Pool Receivable is partially supported by an Eligible Supporting Letter of Credit, then the “Obligor” thereof shall be deemed to be (i) with respect to the Unsupported Outstanding Balance of such Pool Receivable, the Obligor of such Pool Receivable and (ii) with respect to the Supported Outstanding Balance of such Pool Receivable, the related Eligible Supporting Letter of Credit Provider and (y) if any Pool Receivable is an Insured Designated Receivable, the “Obligor” thereof shall be deemed to be (i) with respect to the Insured Amount of such Insured Designated Receivable, the related Eligible Credit Insurance Provider and (ii) with respect to the remaining Outstanding Balance of such Insured Designated Receivable, the Obligor of such Insured Receivable.
“Exiting Notice” has the meaning set forth in Section 1.4(b)(ii) of this Agreement.
“Exiting Purchaser” has the meaning set forth in Section 1.4(b)(ii) of this Agreement.
“Facility Termination Date” means the earliest to occur of: (a) the date determined pursuant to Section 2.2 of this Agreement, (b) the date the Purchase Limit reduces to zero pursuant to Section 1.1(b) of this Agreement, (c) with respect to each Purchaser Group, the earliest to occur of (i) the date that the commitments of the related Liquidity Providers, if any, terminate under the Liquidity Agreement and (ii) the date that the Commitments of all Related Committed Purchasers in such Purchaser Group terminate hereunder, (d) the date which is 15 days after the date on which the Administrator has received written notice from the Seller of its election to terminate the Purchase Facility, and (e) with respect to the LC Bank, any LC Participant or any Related Committed Purchaser, the LC Bank’s, such LC Participant’s or such Related Committed Purchaser’s Scheduled Commitment Termination Date.
“FAS 166/167” has the meaning set forth in Section 1.7(c) of the Agreement.
“FASB” has the meaning set forth in Section 1.7(a) of the Agreement.
“Federal Funds Rate” means, for any day, the per annum rate set forth in the weekly statistical release designated as H.15(519), or any successor publication, published by the Federal Reserve Board (including any such successor, “H.15(519)”) for such day opposite the caption “Federal Funds (Effective).” If on any relevant day such rate is not yet published in H. 15(519), the rate for such day will be the rate set forth in the daily statistical release designated as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or any successor publication, published by the Federal Reserve Bank of New York (including any such successor, the “Composite 3:30 p.m. Quotations”) for such day under the caption “Federal Funds Effective Rate.” If on any relevant day the appropriate rate is not yet published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate for such day will be the arithmetic mean as determined by the Administrator of the rates for the last transaction in overnight Federal funds arranged before 9:00 a.m. (New York time) on that day by each of three leading brokers of Federal funds transactions in New York City selected by the Administrator.
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“Federal Reserve Board” means the Board of Governors of the Federal Reserve System, or any entity succeeding to any of its principal functions.
“Fee Letters” has the meaning set forth in Section 1.5 of the Agreement.
“Fees” means the fees payable by the Seller pursuant to the applicable Fee Letter.
“Fifth Amendment Effective Date” shall mean December 4, 2020.
“Final Payout Date” means the latest of (i) the Facility Termination Date, (ii) the date on which no Capital of or Discount in respect of the Purchased Interest shall be outstanding, (iii) the LC Participation Amount has been reduced to zero ($0) and no Letters of Credit issued hereunder remain outstanding and undrawn (unless backstopped in a manner agreed to in writing by the LC Bank and the Majority LC Participants in their sole and absolute discretion), (iv) the date all other amounts owing to the Purchaser Agents, the Purchasers, the Administrator and the other Indemnified Parties and Affected Person under this Agreement and each of the other Transaction Documents have been paid in full (other than indemnification or other contingent obligations not yet due and owing) and (v) all accrued Servicing Fees have been paid in full.
“Floor” means a rate of interest equal to zero (0.00%) per annum.
“Fresh Start Reporting” means the preparation of consolidated financial statements of ACI in accordance with the American Institute of Certified Public Accountants Statement of Position (90-7), which reflects the consummation of the transactions contemplated by the Plan of Reorganization on a presumed effective date of October 5, 2016.
“Funded Purchase” means a purchase or deemed purchase of undivided percentage ownership interests in the Purchased Interest under the Agreement which (i) is paid for in cash, including pursuant to Section 1.1(b) (other than through reinvestment of Collections pursuant to Section 1.4(b) of the Agreement) or (ii) is treated as a Funded Purchase pursuant to Section 1.2(e) of the Agreement and/or any of the provisions set forth in Sections 1.11 through 1.20 of the Agreement.
“Governmental Acts” has the meaning set forth in Section 1.19 of the Agreement.
“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 agency, authority, instrumentality, body or entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, including any court and any supra-national bodies such as the European Union or the European Central Bank.
“Group A Obligor” means any Obligor with a short-term rating of at least: (a) “A1” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “A+” or better by Standard & Poor’s on its long-term senior unsecured and uncredit-enhanced debt securities, and (b) “P-1” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Al” or better by Moody’s on its long-term senior unsecured and uncredit-enhanced debt securities.
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“Group B Obligor” means an Obligor, not a Group A Obligor, with a short-term rating of at least: (a) “A-2” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “BBB+” to “A” by Standard & Poor’s on its long-term senior unsecured and uncredit-enhanced debt securities, and (b) “P-2” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Baal” to “A2” by Moody’s on its long-term senior unsecured and uncredit-enhanced debt securities.
“Group Capital” means, with respect to any Purchaser Group, an amount equal to the aggregate outstanding Capital of all Purchasers within such Purchaser Group.
“Group C Obligor” means an Obligor, not a Group A Obligor or a Group B Obligor, with a short-term rating of at least: (a) “A-3” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “BBB-” to “BBB” by Standard & Poor’s on its long-term senior unsecured and uncredit-enhanced debt securities, and (b) “P-3” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Baa3” to “Baa2” by Moody’s on its long-term senior unsecured and uncredit-enhanced debt securities; provided, that T S Global Procurement Company Pte. Ltd., and its Subsidiaries need only satisfy the requirements set forth in either of clauses (a) or (b) above to be a Group C Obligor.
“Group Commitment” means, with respect to any Purchaser Group, the aggregate of the Commitments of each Related Committed Purchaser within such Purchaser Group, which amount is set forth on Schedule IV hereto.
“Group D Obligor” means any Obligor that is not a Group A Obligor, Group B Obligor or Group C Obligor.
“Guaranty” of any Person means any obligation of such Person guarantying or in effect guarantying any liability or obligation of any other Person in any manner, whether directly or indirectly, including any such liability arising by virtue of partnership agreements, including any agreement to indemnify or hold harmless any other Person, any performance bond or other suretyship arrangement and any other form of assurance against loss, except endorsement of negotiable or other instruments for deposit or collection in the ordinary course of business.
“Hedging Transaction” means any of the following transactions by ACI or any of its Subsidiaries: any rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction or any combination of the foregoing transactions, including, without limitation, any Interest Rate Hedge or any Commodity Hedge.
“Indemnified Amounts” has the meaning set forth in Section 3.1 of the Agreement.
“Indemnified Party” has the meaning set forth in Section 3.1 of the Agreement.
“Independent Director” has the meaning set forth in paragraph 3(c) of Exhibit IV to the Agreement.
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“Information Package” means a report, in substantially the form of Annex A to the Agreement, furnished to the Administrator pursuant to the Agreement.
“Insolvency Proceeding” means (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors of a Person, composition, marshaling of assets for creditors of a Person, or other similar arrangement in respect of its creditors generally or any substantial portion of its creditors, in each of cases (a) and (b) undertaken under U.S. Federal, state or foreign law, including the Bankruptcy Code.
“Insured Amount” means, with respect to any Insured Designated Receivable, the excess, if any, of (a) the portion of the Outstanding Balance of such Insured Designated Receivable that is insured (based on the allocation rules set forth in the definition of Insured Designated Receivable), over (b) the total amount of deductibles and coinsurance with respect to a claim and such other amounts as determined by the Administrator (in its reasonable discretion) likely to diminish any recovery for a related claim under the related Eligible Credit Insurance (including, without limitation, fees associated with claims, any discount to present value based on the expected timing of such recovery or other “haircut” amounts based on the likelihood of recovery under the related Eligible Credit Insurance).
“Insured Obligor” means each Obligor for which all or a portion of its Receivables are insured pursuant to Eligible Credit Insurance.
“Insured Receivable” means each Receivable for which the Obligor thereof is an Insured Obligor; provided, that no Receivable shall constitute an Insured Receivable at any time the Credit Insurance Policy relating thereto shall cease to constitute Eligible Credit Insurance.
“Insured Designated Receivable” means each Insured Receivable for which all or a portion of the Outstanding Balance thereof is insured pursuant to Eligible Credit Insurance; provided, however, that in allocating Eligible Credit Insurance for any Insured Obligor to the related Insured Receivables, such Eligible Credit Insurance shall be allocated to Receivables based on the date such Receivable was originated and starting with the oldest outstanding Receivable.
“Interest Rate Hedge” means an interest rate exchange, collar, cap, swap, adjustable strike cap, adjustable strike corridor or similar agreements entered into by ACI or any of its Affiliates in the ordinary course operations of their business.
“Interim Report” means each Daily Report and Weekly Report.
“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time. References to sections of the Internal Revenue Code also refer to any successor sections.
“Issuance Notice” has the meaning set forth in Section 1.12(a) of the Agreement.
“LC Bank” has the meaning set forth in the preamble to the Agreement.
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“LC Collateral Account” means the account designated as the LC Collateral Account established and maintained by the Administrator (for the benefit of the LC Bank and the LC Participants), or such other account as may be so designated as such by the Administrator.
“LC Fee Expectation” has the meaning set forth in Section 1.15(c) of the Agreement.
“LC Participant” means each Person listed as such (and its respective Commitment) for each Purchaser Group as set forth on the signature pages of this Agreement or in any Assumption Agreement or Transfer Supplement.
“LC Participation Amount” means, at any time, the then sum of the undrawn amounts of all outstanding Letters of Credit.
“Letter of Credit” means any stand-by letter of credit issued by the LC Bank for the account of the Seller (or for the account of the Transferor or any Subsidiary thereof, as applicable) pursuant to the Agreement.
“Letter of Credit Application” has the meaning set forth in Section 1.12 of the Agreement.
“Level I Liquidity Trigger Period” means each period, if any, commencing on any date that the Liquidity shall be less than $250,000,000 and ending on (but not including) any succeeding date, if any, that the Liquidity shall be greater than $250,000,000.
“Lien” means any ownership interest or claim, mortgage, deed of trust, pledge, lien, security interest, hypothecation, charge or other encumbrance or security arrangement of any nature whatsoever, whether voluntarily or involuntarily given, including, but not limited to, any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease intended as, or having the effect of, security and any filed financing statement or other notice of any of the foregoing (whether or not a lien or other encumbrance is created or exists at the time of the filing) or any hypothetical lien that would give a trustee superior rights to the Administrator or any of the Secured Parties.
“Liquidity” means the sum of (i) unrestricted cash or Permitted Investments of ACI and its Subsidiaries (other than the Securitization Subsidiaries and Bonding Subsidiaries) that are not Foreign Subsidiaries, (ii) withdrawable funds from brokerage accounts of ACI and its Subsidiaries (other than the Securitization Subsidiaries and Bonding Subsidiaries) that are not Foreign Subsidiaries and (iii) any unused commitments that are available to be drawn by ACI pursuant to the terms of this Agreement and any Working Capital Facility. For purposes of this definition, the terms “Securitization Subsidiaries,” “Bonding Subsidiaries,” “Foreign Subsidiaries” and “Working Capital Facility” have the following meanings:
“Bonding Subsidiary” means a Subsidiary of ACI the sole purpose of which is to own a leasehold interest in a coal lease where the lessor thereof is a Person who is not an Affiliate of ACI (but not to operate any mining operations thereon) and to enter into surety or similar arrangements to provide payment assurances to the lessor thereof related to the cost of acquiring such leasehold interest and any bonus bid and royalty payments thereunder, and Bonding Subsidiaries shall mean, collectively, each and every Bonding Subsidiary.
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“Foreign Subsidiaries” means, for any Person, each Subsidiary (other than a Loan Party) of such Person that is (a) a “controlled foreign corporation” (a “CFC”) within the meaning of Section 957 of the Internal Revenue Code of 1986, (b) a Subsidiary of a CFC or (c) a Subsidiary substantially all of the assets of which constitute equity interests (or equity interests and indebtedness) of CFCs or of Subsidiaries described in this clause (c).
“Securitization Subsidiary” means a Subsidiary of ACI (all of the outstanding equity interests of which, other than de minimis preferred stock and director’s qualifying shares, if any, are owned, directly or indirectly, by ACI) that is established for the limited purpose of acquiring and financing accounts receivable (including any bills of exchange) and related assets and property from time to time originated, acquired or otherwise owned by ACI or any Subsidiary of ACI and interests therein of ACI or any Subsidiary of ACI and engaging in activities ancillary thereto.
“Working Capital Facility” shall mean any revolving credit facility entered into by ACI for general working capital purposes, including the Original ABL Credit Agreement solely to the extent such Original ABL Credit Agreement has not been terminated.
“Liquidity Agent” means any bank or other financial institution acting as agent for the various Liquidity Providers under each Liquidity Agreement.
“Liquidity Agreement” means any agreement entered into in connection with the Agreement pursuant to which a Liquidity Provider agrees to make purchases or advances to, or purchase assets from, any Conduit Purchaser in order to provide liquidity for such Conduit Purchaser’s Purchases.
“Liquidity Provider” means each bank or other financial institution that provides liquidity support to any Conduit Purchaser pursuant to the terms of a Liquidity Agreement.
“LLC Agreement” means the limited liability company agreement of Seller.
“Loan Documents” has the meaning set forth in the Original Term Loan Credit Agreement.
“Lock-Box Account” means each account listed on Schedule II to this Agreement (in each case, in the name of the Seller and maintained at a Lock-Box Bank pursuant to a Lock-Box Agreement for the purpose of receiving Collections.
“Lock-Box Agreement” means each agreement, in form and substance reasonably satisfactory to the Administrator, among the Seller, the Servicer, the Administrator and a Lock-Box Bank, governing the terms of the related Lock-Box Accounts.
“Lock-Box Bank” means any of the banks or other financial institutions holding one or more Lock-Box Accounts; provided, however, that such bank or other financial institution shall be either PNC or an Affiliate thereof so long as PNC is the Administrator.
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“Loss Reserve” means, on any date, an amount equal to: (a) the sum of the Aggregate Capital plus the Adjusted LC Participation Amount at the close of business of the Servicer on such date multiplied by (b) (i) the Loss Reserve Percentage on such date divided by (ii) 100% minus the Loss Reserve Percentage on such date.
“Loss Reserve Percentage” means, on any date, (i) the product of (A) 2.5 times (B) the highest average of the Default Ratios for any three consecutive calendar months during the twelve most recent calendar months times (C) (x) the aggregate credit sales made by the Originators and the Transferor during the 5 most recent calendar months plus (y) 97.5% times the aggregate credit sales made by the Originators and the Transferor during the 6th most recent calendar month divided by (ii) the Net Receivables Pool Balance as of such date.
“Majority LC Participants” means, at any time, (i) if fewer than three (3) LC Participants are then a party to this Agreement, all LC Participants and (ii) otherwise, the LC Participants whose Commitments aggregate more than 66 2/3% of the Commitments of all LC Participants at such time; provided that so long as Regions’ Pro Rata Share of the Commitments are not less than its Pro Rata Share of the Commitments as of the Closing Date, the Majority LC Participants shall include Regions.
“Majority Purchaser Agents” means, at any time, (i) if fewer than three (3) Purchaser Agents are then a party to this Agreement, all Purchaser Agents and (ii) otherwise, the Purchaser Agents for the Purchaser Groups with Related Committed Purchasers whose Commitments aggregate more than 66 2/3% of the aggregate of the Commitments of all Related Committed Purchasers in all Purchaser Groups; provided that so long as Regions’ Ratable Share of the Commitments are not less than its Ratable Share of the Commitments as of the Closing Date, the Majority Purchaser Agents shall be required to include Regions.
“Material Adverse Effect” means relative to any Person with respect to any event or circumstance, a material adverse effect on:
(a) the assets, operations, business or financial condition of such Person;
(b) the ability of any such Person to perform its obligations under the Agreement or any other Transaction Document to which it is a party;
(c) the validity or enforceability of the Agreement or any other Transaction Document, or the validity, enforceability, value or collectibility of any of the Pool Receivables;
(d) the status, perfection, enforceability or priority of any Secured Party’s or the Seller’s interest in the Pool Assets; or
(e) the rights and remedies of any Secured Party under the Transaction Documents.
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“Minimum Dilution Reserve” means, on any day, an amount equal to: (a) the sum of the Aggregate Capital plus the Adjusted LC Participation Amount at the close of business of the Servicer on such day, multiplied by (b)(i)the Minimum Dilution Reserve Percentage divided by (ii) 100% minus the Minimum Dilution Reserve Percentage on such day.
“Minimum Dilution Reserve Percentage” means, on any day, the product of (a) the average of the Dilution Ratios for the twelve most recent calendar months multiplied by (b) the Dilution Horizon.
“Minimum Liquidity” means $275,000,000.
“Minimum Liquidity Period” means each period, if any, commencing on the date that the Liquidity is less than the Minimum Liquidity and ending on (but not including) the date, if any, that the Liquidity is no longer less than the Minimum Liquidity.
“Monthly Settlement Date” means the 21st day of each calendar month (or if such day is not a Business Day, the next occurring Business Day); provided, however, that on and after the occurrence and continuation of any Termination Event, the Monthly Settlement Date shall be the date selected as such by the Administrator (with the consent or at the direction of the Majority Purchaser Agents) from time to time (it being understood that the Administrator (with the consent or at the direction of the Majority Purchaser Agents) may select such Monthly Settlement Date to occur as frequently as daily) or, in the absence of any such selection, the date which would be the Monthly Settlement Date pursuant to this definition).
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.
“Mortgage” means a mortgage or deed of trust in favor of any Person on any real property of any Originator for which all, or any portion thereof, is a location of such Originator’s mining operations or a minehead.
“Net Receivables Pool Balance” means, at any time: (a) the Outstanding Balance of Eligible Receivables then in the Receivables Pool, minus (b) the Excess Concentration.
“No Proceedings Agreement” means each of (a) that certain no proceedings letter agreement, dated as of February 8, 2024, among the Administrator, the Term Loan Agent, Seller and ACI, (b) that certain no proceedings letter agreement, dated as of April 27, 2017, among the Administrator, the ABL Agent, Seller and ACI and (c) any additional replacement or successor agreement consented to in writing by the Administrator in its reasonable discretion and entered into by the agent under any Credit Agreement and ACI.
“Notes” means short-term promissory notes issued, or to be issued, by any Conduit Purchaser to fund its investments in accounts receivable or other financial assets.
“Obligor” means, with respect to any Receivable, the Person obligated to make payments pursuant to the Contract relating to such Receivable.
“Obligor Percentage” means, at any time of determination, for each Obligor, a fraction, expressed as a percentage, (a) the numerator of which is the aggregate Outstanding Balance of the Eligible Receivables of such Obligor less the amount (if any) then included in the calculation of
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the Excess Concentration with respect to such Obligor and (b) the denominator of which is the aggregate Outstanding Balance of all Eligible Receivables at such time.
“Order” has the meaning set forth in Section 1.20 of the Agreement.
“Originator” and “Originators” have the meaning set forth in the Purchase and Sale Agreement, as the same may be modified from time to time by adding new Originators or removing Originators, in each case with the prior written consent of the Administrator.
“Originator Performance Guaranty” means the Amended and Restated Originator Performance Guaranty, dated as of the Closing Date, by each Originator in favor of the Administrator for the benefit of the Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“Outstanding Balance” of any Receivable at any time means the then outstanding principal balance thereof.
“Participant” has the meaning set forth in Section 5.3(b) of the Agreement.
“Participant Register” has the meaning set forth in Section 5.3(b) of the Agreement.
“Paydown Notice” has the meaning set forth in Section 1.4(f)(i) of the Agreement.
“Performance Guarantor” means ACI and its permitted successors and assigns.
“Performance Guaranty” means the Third Amended and Restated Performance Guaranty, dated as of the Closing Date, by the Performance Guarantor in favor of the Administrator for the benefit of the Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“Permitted Lien” means any Lien (a) as to which no enforcement collection, execution, levy or foreclosure proceeding shall have been commenced or threatened and that solely secure the payment of taxes, assessments and/or governmental charges or levies, if and to the extent the same are either (x) not yet due and payable or (y) being contested in good faith and as to which adequate reserves have been provided in accordance with GAAP, but, in any case, only to the extent that such Lien securing payment of such taxes or assessments or other governmental charges constitutes an inchoate tax lien, and (b) inchoate and unperfected workers’, mechanics’, suppliers’ or similar Liens arising in the ordinary course of business, in any case, as to which no enforcement collection, execution, levy or foreclosure proceeding shall have been commenced or threatened; provided, however, that no Lien(s) that could (individually or in the aggregate) be expected to result in a Material Adverse Effect shall constitute a Permitted Lien.
“Permitted Investments” means:
| i. | securities with maturities of 18 months or less from the date of acquisition issued or fully guaranteed or insured by the United States government or any agency thereof; |
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| ii. | certificates of deposit and time deposits with maturities of 18 months or less from the date of acquisition and overnight bank deposits of any commercial bank having capital and surplus in excess of $500,000,000; |
| iii. | repurchase obligations of any commercial bank satisfying the requirements of clause (ii) of this definition with respect to securities issued or fully guaranteed or insured by the United States government; |
| iv. | commercial paper of a domestic issuer rated at least A-2 by Standard & Poor’s or P-2 by Moody’s, or carrying an equivalent rating by a nationally recognized rating agency if both of Standard & Poor’s and Moody’s cease publishing ratings of investments; |
| v. | securities with maturities of 18 months or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by Standard & Poor’s or A by Moody’s; |
| vi. | securities with maturities of 18 months or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (ii) of this definition; |
| vii. | corporate obligations such as notes, bonds, loan participation certificates, master notes, and variable rate demand notes rated at least A by Standard & Poor’s or A2 by Moody’s; |
| viii. | asset backed and mortgage backed securities and collateralized mortgage obligations rated AAA by Standard & Poor’s or Aaa by Moody’s; |
| ix. | money market auction rate preferred securities and auction rate notes with auctions scheduled no less frequently than every 49 days; and |
| x. | shares of money market mutual or similar funds which invest principally in assets satisfying the requirements of clauses (i) through (ix) of this definition. |
“Permitted Merger” means (i) any merger of any existing Originator into any other existing Originator or (ii) any merger of any existing Originator into ACI.
“Person” means an individual, partnership, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, limited liability company or other entity, or a government or any political subdivision or agency thereof.
“Plan of Reorganization” shall mean the chapter 11 plan of reorganization of the Chapter 11 Debtors confirmed by the Confirmation Order.
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“PNC” has the meaning set forth in the preamble to the Agreement.
“Pool Assets” has the meaning set forth in Section 1.2(d) of the Agreement.
“Pool Receivable” means a Receivable in the Receivables Pool.
“Portion of Capital” means, with respect to any Purchaser and its related Capital, the portion of such Capital being funded or maintained by such Purchaser by reference to a particular interest rate basis.
“Prior Agreement” has the meaning set forth in the preamble to the Agreement.
“Prior Agreement Outstanding Amounts” has the meaning set forth in the preamble to the Agreement.
“Program Support Agreement” means and includes any Liquidity Agreement and any other agreement entered into by any Program Support Provider providing for: (a) the issuance of one or more letters of credit for the account of any Conduit Purchaser, (b) the issuance of one or more surety bonds for which any Conduit Purchaser is obligated to reimburse the applicable Program Support Provider for any drawings thereunder, (c) the sale by any Conduit Purchaser to any Program Support Provider of the Purchased Interest (or portions thereof) maintained by such Conduit Purchaser and/or (d) the making of loans and/or other extensions of credit to any Conduit Purchaser in connection with such Conduit Purchaser’s receivables-securitization program contemplated in the Agreement, together with any letter of credit, surety bond or other instrument issued thereunder.
“Program Support Provider” means and includes, with respect to any Conduit Purchaser, any Liquidity Provider and any other Person (other than any customer of such Conduit Purchaser) now or hereafter extending credit or having a commitment to extend credit to or for the account of, or to make purchases from, such Conduit Purchaser pursuant to any Program Support Agreement.
“Pro Rata Share” means, as to any LC Participant, a fraction, the numerator of which equals the Commitment of such LC Participant at such time and the denominator of which equals the aggregate of the Commitments of all LC Participants at such time.
“Purchase” has the meaning set forth in Section 1.1(a) of this Agreement.
“Purchase and Sale Agreement” means the Second Amended and Restated Purchase and Sale Agreement, dated as of the Closing Date, between the Originators and the Transferor, as such agreement may be amended, supplemented or otherwise modified from time to time.
“Purchase and Sale Indemnified Amounts” has the meaning set forth in Section 9.1 of the Purchase and Sale Agreement.
“Purchase and Sale Indemnified Party” has the meaning set forth in Section 9.1 of the Purchase and Sale Agreement.
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“Purchase and Sale Termination Date” has the meaning set forth in Section 1.4 of the Purchase and Sale Agreement.
“Purchase and Sale Termination Event” has the meaning set forth in Section 8.1 of the Purchase and Sale Agreement.
“Purchase Date” means the date on which a Funded Purchase or a reinvestment is made pursuant to this Agreement.
“Purchase Facility” has the meaning set forth in Section 1.1 of the Purchase and Sale Agreement.
“Purchase Limit” means $150,000,000, as such amount may be reduced pursuant to Section 1.1 (b) of the Agreement or otherwise in connection with any Exiting Purchaser, or increased pursuant to Section 1.1(f) of this Agreement. References to the unused portion of the Purchase Limit shall mean, at any time, the Purchase Limit minus the sum of the then Aggregate Capital plus the LC Participation Amount.
“Purchase Notice” has the meaning set forth in Section 1.2(a) of the Agreement.
“Purchase Price” has the meaning set forth in Section 2.1 of the Purchase and Sale Agreement.
“Purchase Report” has the meaning set forth in Section 2.1 of the Purchase and Sale Agreement.
“Purchased Interest” means, at any time, the undivided percentage ownership interest in: (a) each and every Pool Receivable now existing or hereafter arising, (b) all Related Security with respect to such Pool Receivables and (c) all Collections with respect to, and other proceeds of, such Pool Receivables and Related Security (but excluding, for the avoidance of doubt, any Seller’s Permitted Payments). Such undivided percentage interest shall be computed as:
Aggregate Capital + Adjusted LC
Participation Amount + Total Reserves
Net Receivables Pool Balance
The Purchased Interest shall be determined from time to time pursuant to Section 1.3 of the Agreement.
“Purchaser” means each Conduit Purchaser, Related Committed Purchaser, LC Participant and the LC Bank.
“Purchaser Agent” means each Person acting as agent on behalf of a Purchaser Group and designated as a Purchaser Agent for such Purchaser Group on the signature pages to this Agreement or any other Person who becomes a party to the Agreement as a Purchaser Agent pursuant to an Assumption Agreement or a Transfer Supplement.
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“Purchaser Group” means, (i) for any Conduit Purchaser, such Conduit Purchaser, together with such Conduit Purchaser’s Related Committed Purchasers, related Purchaser Agent and related LC Participants, (ii) for Regions, Regions as a Purchaser Agent, a Related Committed Purchaser and an LC Participant and (iii) for PNC, PNC as a Purchaser Agent, a Related Committed Purchaser, the LC Bank and an LC Participant.
“Purchasers’ Share” of any amount, at any time, means such amount multiplied by the Purchased Interest at such time.
“Purchasing Related Committed Purchaser” has the meaning set forth in Section 5.3(c) of the Agreement.
“Ratable Share’ means, for each Purchaser Group, such Purchaser Group’s Group Commitment divided by the aggregate Group Commitments of all Purchaser Groups.
“Rating Agency” mean each of Standard & Poor’s and Moody’s (and/or each other rating agency then rating the Notes of any Conduit Purchaser).
“Receivable” means any indebtedness and other obligations owed to any Originator, the Transferor or the Seller by, or any right of the Seller, the Transferor or any Originator to payment from or on behalf of, an Obligor, whether constituting an account, as-extracted collateral, chattel paper, a payment intangible, an instrument or a general intangible, in each instance arising in connection with the sale of goods or the rendering of services, and includes, without limitation, the obligation to pay any finance charges, fees and other charges with respect thereto. Indebtedness and other obligations arising from any one transaction, including, without limitation, indebtedness and other obligations represented by an individual invoice or agreement, shall constitute a Receivable separate from a Receivable consisting of the indebtedness and other obligations arising from any other transaction.
“Receivables Pool” means, at any time, all of the then outstanding Receivables purchased by the Seller pursuant to the Sale and Contribution Agreement prior to the Facility Termination Date.
“Regions” means Regions Bank.
“Register” has the meaning set forth in Section 5.17 of the Agreement.
“Reimbursement Obligation” has the meaning set forth in Section 1.14 of the Agreement.
“Related Committed Purchaser” means each Person listed as such for each Conduit Purchaser as set forth on the signature pages of the Agreement or in any Assumption Agreement or Transfer Supplement.
“Related Rights” has the meaning set forth in Section 1.1 of the Purchase and Sale Agreement.
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“Related Security” means, with respect to any Receivable:
(a) all of the Seller’s, the Transferor’s and each Originator’s interest in any goods (including returned goods), and documentation of title evidencing the shipment or storage of any goods (including returned goods), the sale of which gave rise to such Receivable;
(b) all instruments and chattel paper that may evidence such Receivable;
(c) all other security interests or liens and property subject thereto from time to time purporting to secure payment of such Receivable (including any Eligible Credit Insurance or Eligible Supporting Letter of Credit and any other supporting letter of credit or any proceeds of any drawings thereunder), whether pursuant to the Contract related to such Receivable or otherwise, together with all UCC financing statements or similar filings relating thereto;
(d) all of the Seller’s, the Transferor’s and each Originator’s rights, interests and claims under the Contracts and all guaranties, indemnities, insurance and other agreements (including the related Contract) or arrangements of whatever character from time to time supporting or securing payment of such Receivable or otherwise relating to such Receivable, whether pursuant to the Contract related to such Receivable or otherwise including, without limitation, any Credit Insurance Policy covering all or any portion of such Receivable; and
(e) all of the Seller’s rights, interests and claims under the Sale Agreements and the other Transaction Documents.
“Reportable Compliance Event” means that any Covered Entity becomes a Sanctioned Person, or is charged by indictment, criminal complaint or similar charging instrument, arraigned, or custodially detained in connection with any Anti-Terrorism Law or any predicate crime to any Anti-Terrorism Law, or has knowledge of facts or circumstances to the effect that it is reasonably likely that any aspect of its operations is in actual or probable violation of any Anti-Terrorism Law.
“Restricted Payments” has the meaning set forth in Section 1(n) of Exhibit IV of the Agreement.
“Rio Tinto” means Rio Tinto Energy America Inc.
“Rio Tinto Receivable” means a Receivable (a) arising under the “SRP Contract” (as such term is defined in the Coal Sales Agreement, dated October 1, 2009, by and among ACI and Kennecott Coal Sales Company (the “SRP Agreement”) and acquired by ACI pursuant to the terms and conditions of such SRP Agreement or (b) arising under a “Coal Sales Agreement” (as such term is defined in the Arch Coal Supply Agreement, dated October 1, 2009, between ACI and Rio Tinto (the “Rio Tinto Agreement”) and acquired by ACI pursuant to the terms and conditions of such Rio Tinto Agreement.
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“Rio Tinto Trigger Event” means, with respect to all Rio Tinto Receivables, the first to occur of (a) Rio Tinto shall fail to maintain a long term debt rating of at least “BBB-” by Standard & Poor’s and “Baa3” by Moody’s and (b) the aggregate amount of any asserted dispute, offset, hold back, defense, or Adverse Claim outstanding against all Rio Tinto Receivables shall be greater than $50,000.
“Sale Agreements” means, collectively the Purchase and Sale Agreement and the Sale and Contribution Agreement.
“Sale and Contribution Agreement” means the Second Amended and Restated Sale and Contribution Agreement, dated as of the Closing Date, between the Transferor and the Seller, as such agreement may be amended, supplemented or otherwise modified from time to time.
“Sale and Contribution Indemnified Amounts” has the meaning set forth in Section 9.1 of the Sale and Contribution Agreement.
“Sale and Contribution Indemnified Party” has the meaning set forth in Section 9.1 of the Sale and Contribution Agreement.
“Sale and Contribution Termination Date” has the meaning set forth in Section 1.4 of the Sale and Contribution Agreement.
“Sale and Contribution Termination Event” has the meaning set forth in Section 8.1 of the Sale and Contribution Agreement.
“Sales Agency Agreements” means each of (i) the Customer Relations and Marketing Services Agreement, dated as of January 1, 2006, between Arch Sales and the Originators from time to time party thereto, as amended, restated, supplemented or otherwise modified from time to time and (ii) the Customer Relations and Marketing Services Agreement, dated as of June 15, 2011, between Arch Sales and the Originators from time to time party thereto, as amended, restated, supplemented or otherwise modified from time to time.
“Sanctioned Country” means a country subject to a sanctions program maintained under any Anti-Terrorism Law.
“Sanctioned Person” means any individual person, group, regime, entity or thing listed or otherwise recognized as a specially designated, prohibited, sanctioned or debarred person, group, regime, entity or thing, or subject to any limitations or prohibitions (including but not limited to the blocking of property or rejection of transactions), under any Anti-Terrorism Law.
“Scheduled Commitment Termination Date” means with respect to the LC Bank, any LC Participant or any Related Committed Purchaser, August 1, 2025, as such date may be extended from time to time in the sole and absolute discretion of the LC Bank, such LC Participant or such Related Committed Purchaser, as the case may be.
“SEC” shall mean the U.S. Securities and Exchange Commission or any governmental agencies substituted therefor.
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“Secured Parties” means the Administrator, each Purchaser, each Purchaser Agent, each Indemnified Party and each Affected Person.
“Seller” has the meaning set forth in the preamble to the Agreement.
“Seller’s Permitted Payments” means amounts paid to the Seller for its own account by (or on behalf of) the Administrator, the Purchaser Agents and the Purchasers as proceeds of Purchases or pursuant to Section 1.4, in each case, in accordance with the terms of this Agreement and the other Transaction Documents, solely to the extent such amounts have been used by the Seller to (i) pay the “Purchase Price” due by the Seller to the Transferor under the Sale and Contribution Agreement, (ii) make payments of principal or interest due to the Transferor under the Company Note or (iii) make other Restricted Payments, in each case, solely to the extent such payments were permitted (and not prohibited) when made by the terms of this Agreement and the other Transaction Documents.
“Seller’s Share” of any amount means the greater of: (a) $0 and (b) such amount minus the Purchasers’ Share.
“Servicer” has the meaning set forth in the preamble to the Agreement.
“Servicing Fee” means the fee referred to in Section 4.6 of the Agreement.
“Servicing Fee Rate” means the rate referred to in Section 4.6 of the Agreement.
“Settlement Date” means with respect to any Portion of Capital for any Settlement Period, (i) prior to the Facility Termination Date, the Monthly Settlement Date and (ii) on and after the Facility Termination Date, each day selected from time to time by the Administrator (with the consent or at the direction of the Majority Purchaser Agents) (it being understood that the Administrator (with the consent or at the direction of the Majority Purchaser Agents) may select such Settlement Date to occur as frequently as daily), or, in the absence of such selection, the Monthly Settlement Date.
“Settlement Period” means: (a) before the Facility Termination Date: (i) initially the period commencing on the date of the initial purchase pursuant to Section 1.2 of the Agreement (or in the case of any fees payable hereunder, commencing on the Closing Date) and ending on (but not including) the next Monthly Settlement Date, and (ii) thereafter, each period commencing on such Monthly Settlement Date and ending on (but not including) the next Monthly Settlement Date, and (b) on and after the Facility Termination Date, such period (including a period of one day) as shall be selected from time to time by the Administrator (with the consent or at the direction of the Majority Purchaser Agents) or, in the absence of any such selection, each period of 30 days from the last day of the preceding Settlement Period.
“SOFR” means, for any day, a rate equal to the secured overnight financing rate as administered by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).
“SOFR Adjustment” means ten basis points (0.10%).
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“SOFR Determination Date” has the meaning set forth in the definition of “Daily Simple SOFR”.
“SOFR Floor” means a rate of interest per annum equal to zero basis points (0.00%).
“SOFR Rate Day” has the meaning set forth in the definition of “Daily Simple SOFR”.
“SOFR Reserve Percentage” means, for any day, the maximum effective percentage in effect on such day, if any, as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the reserve requirements (including, without limitation, supplemental, marginal and emergency reserve requirements) with respect to SOFR funding.
“Solvent” means, with respect to any Person at any time, a condition under which:
(i) the fair value and present fair saleable value of such Person’s total assets is, on the date of determination, greater than such Person’s total liabilities (including contingent and unliquidated liabilities) at such time;
(ii) the fair value and present fair saleable value of such Person’s assets is greater than the amount that will be required to pay such Person’s probable liability on its existing debts as they become absolute and matured (“debts,” for this purpose, includes all legal liabilities, whether matured or unmatured, liquidated or unliquidated, absolute, fixed, or contingent);
(iii) such Person is and shall continue to be able to pay all of its liabilities as such liabilities mature; and
(iv) such Person does not have unreasonably small capital with which to engage in its current and in its anticipated business.
For purposes of this definition:
(A) the amount of a Person’s contingent or unliquidated liabilities at any time shall be that amount which, in light of all the facts and circumstances then existing, represents the amount which can reasonably be expected to become an actual or matured liability;
(B) the “fair value” of an asset shall be the amount which may be realized within a reasonable time either through collection or sale of such asset at its regular market value;
(C) the “regular market value” of an asset shall be the amount which a capable and diligent business person could obtain for such asset from an interested buyer who is willing to purchase such asset under ordinary selling conditions; and
(D) the “present fair saleable value” of an asset means the amount which can be obtained if such asset is sold with reasonable promptness in an arm’s-length transaction in an existing and not theoretical market.
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“Special Concentration Limit” has the meaning set forth in the definition of Concentration Percentage.
“Special Obligor” has the meaning set forth in the definition of Concentration Percentage.
“Spike Factor” means, for any calendar month, (a) the positive difference, if any, between: (i) the highest Dilution Ratio for any one calendar month during the twelve most recent calendar months and (ii) the arithmetic average of the Dilution Ratios for such twelve months times (b) (i) the highest Dilution Ratio for any one calendar month during the twelve most recent calendar months divided by (ii) the arithmetic average of the Dilution Ratios for such twelve months.
“Standard & Poor’s” means S&P Global Ratings and any successor thereto.
“Subject Merger” shall mean the transaction involving Core Natural Resources and ACI as set forth in the Subject Merger Agreement.
“Subject Merger Agreement” shall mean that certain Agreement and Plan of Merger, dated as of August 20, 2024, by and among CONSOL Energy Inc., Mountain Range Merger Sub Inc. and ACI, as in effect on August 20, 2024.
“Sub-Servicer” has the meaning set forth in Section 4.1(d) of this Agreement.
“Subsidiary” means, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock of each class or other interests having ordinary voting power (other than stock or other interests having such power only by reason of the happening of a contingency) to elect a majority of the Board of Directors or other managers of such entity are at the time owned, or management of which is otherwise controlled: (a) by such Person, (b) by one or more Subsidiaries of such Person or (c) by such Person and one or more Subsidiaries of such Person.
“Supported Outstanding Balance” means, for any Receivable at any time that is supported in whole or in part by an Eligible Supporting Letter of Credit, the lesser of (a) the Outstanding Balance of such Receivable and (b) the face amount of such Eligible Supporting Letter of Credit.
“Tangible Net Worth” means, with respect to any Person, the tangible net worth of such Person as determined in accordance with generally accepted accounting principles, consistently applied.
“Taxes” has the meaning set forth in Section 1.10 of the Agreement.
“Term Loan Agent” has the meaning set forth in the definition of Credit Agreement.
“Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Administrator in its reasonable discretion).
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“Term SOFR Determination Date” has the meaning set forth in the definition of “Term SOFR Rate”.
“Term SOFR Rate” shall mean, with respect to any amount for which the Term SOFR Reference Rate applies, for any day in any Settlement Period, the interest rate per annum determined by the applicable Purchaser Agent by dividing (the resulting quotient rounded upwards, at such Purchaser Agent’s discretion, to the nearest 1/100th of 1%) (A) the Term SOFR Reference Rate for a term of the Yield Period on the day (the “Term SOFR Determination Date”) that is two (2) Business Days prior to the first day of such Settlement Period, as such rate is published by the Term SOFR Administrator, by (B) a number equal to 1.00 minus the SOFR Reserve Percentage. If the Term SOFR Reference Rate for the applicable tenor has not been published or replaced with a Benchmark Replacement by 5:00 p.m. (Pittsburgh, Pennsylvania time) on the Term SOFR Determination Date, then the Term SOFR Reference Rate, for purposes of clause (A) in the preceding sentence, shall be the Term SOFR Reference Rate for such tenor on the first Business Day preceding such Term SOFR Determination Date for which such Term SOFR Reference Rate for such tenor was published in accordance herewith, so long as such first preceding Business Day is not more than three (3) Business Days prior to such Term SOFR Determination Date. If the Term SOFR Rate, determined as provided above, would be less than the SOFR Floor, then the Term SOFR Rate shall be deemed to be the SOFR Floor.
“Term SOFR Reference Rate” shall mean the forward-looking term rate based on SOFR.
“Termination Day” means: (a) each day on which the conditions set forth in Section 2(b) of Exhibit II to the Agreement are not satisfied or (b) each day that occurs on or after the Facility Termination Date.
“Termination Event” has the meaning specified in Exhibit V to the Agreement.
“Termination Fee” means, for any Settlement Period during which a Termination Day occurs, the amount, if any, by which: (a) the additional Discount (calculated without taking into account any Termination Fee or any shortened duration of such Settlement Period pursuant to the definition thereof) that would have accrued during such Settlement Period on the reductions of Capital relating to such Settlement Period had such reductions not been made, exceeds (b) the income, if any, received by the applicable Purchaser from investing the proceeds of such reductions of Capital, as determined by the applicable Purchaser Agent, which determination shall be binding and conclusive for all purposes, absent manifest error.
“Tier 1 Eligible Foreign Obligor” means an Obligor which is a resident of any country (other than the United States of America) that has a short-term foreign currency rating (or, if such country does not have such a short-term foreign currency rating, a long-term foreign currency rating) of at least “A2” (or “A”) by Standard & Poor’s and “P-1” (or “A2”) by Moody’s.
“Tier 2 Eligible Foreign Obligor” means any Eligible Foreign Obligor that is not a Tier 1 Eligible Foreign Obligor.
“Total Reserves” means, at any time, the sum of: (a) the Yield Reserve, plus (b) the greater of (i) the Concentration Reserve plus the Minimum Dilution Reserve and (ii) the Loss Reserve plus the Dilution Reserve.
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“Transaction Documents” means the Agreement, the Lock-Box Agreements, each Fee Letter, the Purchase and Sale Agreement, the Sale and Contribution Agreement, each Company Note, the Performance Guaranty, the Originator Performance Guaranty, each Sales Agency Agreement, any No Proceedings Agreement and all Information Packages, Interim Reports, other certificates, instruments, UCC financing statements, reports, notices, agreements and documents executed or delivered under or in connection with the Agreement, in each case as the same may be amended, supplemented or otherwise modified from time to time in accordance with the Agreement.
“Transfer Supplement” has the meaning set forth in Section 6.3(c) of this Agreement.
“Transferor” has the meaning set forth in the Sale and Contribution Agreement.
“TVA” means Tennessee Valley Authority, an Obligor of the Originators and the Transferor.
“U.S. Government Securities Business Day” means any day except for (A) a Saturday, (B) a Sunday or (C) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.
“UCC” means the Uniform Commercial Code as from time to time in effect in the applicable jurisdiction.
“Unmatured Purchase and Sale Termination Event” means any event which, with the giving of notice or lapse of time, or both, would become a Purchase and Sale Termination Event.
“Unmatured Sale and Contribution Termination Event” means any event which, with the giving of notice or lapse of time, or both, would become a Sale and Contribution Termination Event.
“Unmatured Termination Event” means an event that, with the giving of notice or lapse of time, or both, would constitute a Termination Event.
“Unsupported Outstanding Balance” means, for any Receivable at any time that is supported in part by an Eligible Supporting Letter of Credit, (a) the then Outstanding Balance of such Receivable, less (b) the Supported Outstanding Balance for such Receivable.
“USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, as the same has been, or shall hereafter be, renewed, extended, amended or replaced.
“Weekly Report” has the meaning set forth in Section 1(a)(ii) of Exhibit IV to the Agreement.
“Yield Period” means one month.
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“Yield Reserve” means, on any date, an amount equal to: (a) the sum of the Aggregate Capital plus the Adjusted LC Participation Amount at the close of business of the Servicer on such date multiplied by (b) (i) the Yield Reserve Percentage on such date divided by (ii) 100% minus the Yield Reserve Percentage on such date.
“Yield Reserve Percentage” means at any time:
| (BR+SFR) | x l.5 x DSO | |||
| 360 |
where:
| BR | = | the Base Rate computed for the most recent Settlement Period, | ||||
| DSO | = | Days’ Sales Outstanding, and | ||||
| SFR | = | the Servicing Fee Rate | ||||
Other Terms. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles. As the context requires, all terms used in Article 9 of the UCC in the State of New York, and not specifically defined herein, are used herein as defined in such Article 9. Unless the context otherwise requires, “or” means “and/or,” and “including” (and with correlative meaning “include” and “includes”) means including without limiting the generality of any description preceding such term.
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EXHIBIT II
CONDITIONS PRECEDENT
1. Conditions Precedent to Effectiveness. The effectiveness of the Agreement is subject to the condition precedent that (I) the Confirmation Order shall have been entered and shall not be subject to a stay or have been reversed, modified or amended (other than as otherwise consented to in writing by the Administrator and each Purchaser), (II) the Plan of Reorganization shall have become effective and (III) the Administrator and each Purchaser Agent shall have received, on or before the Closing Date, each of the following, each in form and substance (including the date thereof) reasonably satisfactory to the Administrator and each Purchaser Agent:
(a) Counterparts of (i) the Agreement, (ii) each Sale Agreement, (iii) the Performance Guaranty, (iv) each Fee Letter and (v) the Originator Performance Guaranty, in each case, duly executed by the parties thereto.
(b) Certified copies of: (i) the resolutions of the board of directors of each of the Seller, the Originators, the Transferor, and ACI authorizing the execution, delivery and performance by the Seller, the Originators, the Transferor and ACI, as the case may be, of the Agreement and the other Transaction Documents to which it is a party; (ii) all documents evidencing other necessary corporate or organizational action and governmental approvals, if any, with respect to the Agreement and the other Transaction Documents and (iii) the certificate of incorporation and by-laws or limited liability company agreement, as applicable, of the Seller, the Originators, the Transferor and ACI.
(c) A certificate of the Secretary or Assistant Secretary of the Seller, each of the Originators, the Transferor and ACI certifying the names and true signatures of its officers who are authorized to sign this Agreement and the other Transaction Documents to which it is a party. Until the Administrator receives a subsequent incumbency certificate from the Seller, the Originators, the Transferor or ACI, as the case may be, the Administrator shall be entitled to rely on the last such certificate delivered to it by the Seller, the Originators, the Transferor or ACI, as the case may be.
(d) Completed UCC search reports, dated the Closing Date or no earlier than 30 days prior thereto, listing the financing statements filed in all applicable jurisdictions that name any Originator, Transferor or the Seller as debtor, together with copies of such other financing statements, and similar search reports with respect to judgment liens, federal tax liens and liens of the Pension Benefit Guaranty Corporation in such jurisdictions, as the Administrator may reasonably request, showing no Adverse Claims on any Pool Assets other than any security interests that are released as of the Closing Date pursuant to the Confirmation Order or the Plan of Reorganization.
(e) Favorable opinions, addressed to the Administrator, each Purchaser Agent and each Purchaser, in form and substance reasonably satisfactory to the Administrator, of external counsel for the Seller, the Originators, the Servicer and ACI, covering such matters as the Administrator may reasonably request, including, without limitation, (i) certain Delaware corporate and no conflict matters, (ii) certain organizational and New York enforceability matters (iii) certain bankruptcy matters, and (iv) certain UCC creation and Delaware perfection matters.
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(f) Evidence of payment by the Seller of all accrued and unpaid fees (including those contemplated by the Fee Letters), costs and expenses to the extent then due and payable on the date thereof, including any such costs, fees and expenses arising under or referenced in Section 5.4 of the Agreement (including all Attorney Costs that have been invoiced at least one (1) Business Day prior to the Closing Date and payment of reasonable costs and expenses to counsel for Regions in an amount not to exceed $15,000) and the Fee Letters.
(g) Each Fee Letter duly executed by the Seller and ACI.
(h) Good standing certificates with respect to each of the Seller, the Originators, the Transferor and ACI issued by the Secretary of State (or similar official) of the state of each such Person’s organization or formation and principal place of business.
(i) All information with respect to the Receivables as the Administrator or the Purchasers may reasonably request.
(j) A copy of the Confirmation Order.
2. Conditions Precedent to All Funded Purchases, Issuances of Letters of Credit and Reinvestments. Each Funded Purchase (including the initial Funded Purchase) and the issuance of any Letters of Credit and each reinvestment shall be subject to the further conditions precedent that:
(a) in the case of each Funded Purchase and the issuance of any Letters of Credit, the Servicer shall have delivered to the Administrator and each Purchaser Agent on or before such purchase or issuance, as the case may be, in form and substance reasonably satisfactory to the Administrator and each Purchaser Agent, a completed pro forma Information Package to reflect the level of the Aggregate Capital, the LC Participation Amount and related reserves and the calculation of the Purchased Interest after such subsequent purchase or issuance, as the case may be, and a completed Purchase Notice or Issuance Notice, as applicable, in the form of Annex B-1 or B-2, as applicable; and
(b) on the date of such Funded Purchase, issuance or reinvestment, as the case may be, the following statements shall be true (and acceptance of the proceeds of such Funded Purchase, issuance or reinvestment shall be deemed a representation and warranty by the Seller that such statements are then true):
(i) the representations and warranties contained in Exhibit III to the Agreement are true and correct in all material respects on and as of the date of such Funded Purchase, issuance or reinvestment as though made on and as of such date except for representations and warranties which apply as to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such earlier date);
(ii) no event has occurred and is continuing, or would result from such Funded Purchase, issuance or reinvestment, that constitutes a Termination Event or an Unmatured Termination Event;
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(iii) the sum of the Aggregate Capital plus the LC Participation Amount, after giving effect to any such Funded Purchase, issuance or reinvestment, as the case may be, shall not exceed the Purchase Limit, and the Purchased Interest shall not exceed 100%; and
(iv) the Facility Termination Date has not occurred.
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EXHIBIT III
REPRESENTATIONS AND WARRANTIES
1. Representations and Warranties of the Seller. The Seller represents and warrants to the Administrator, each Purchaser Agent and each Purchaser as of the Closing Date that:
(a) Existence and Power. The Seller is a limited liability company duly organized, validly existing and in good standing under the laws of Delaware, and has all organizational power and all governmental licenses, authorizations, consents and approvals required to carry on its business in each jurisdiction in which its business is conducted except if failure to have such licenses, authorizations, consents or approvals could not reasonably be expected to have a Material Adverse Effect.
(b) Company and Governmental Authorization, Contravention. The execution, delivery and performance by the Seller of this Agreement and each other Transaction Document to which it is a party (i) are within the Seller’s organizational powers, have been duly authorized by all necessary organizational action, require no action by or in respect of, or filing with (other than the filing of UCC financing statements and continuation statements), any governmental body, agency or official, (ii) except as would not reasonably be expected to have a Material Adverse Effect, do not contravene, or constitute a default under, any provision of Applicable Law or of the operating agreement of the Seller or of any agreement, judgment, injunction, order, decree or other instrument binding upon the Seller and (iii) do not result in the creation or imposition of any lien (other than liens in favor of the Administrator) on assets of the Seller.
(c) Binding Effect of Agreement. This Agreement and each other Transaction Document to which it is a party constitutes the legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its respective terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether enforceability is considered in a proceeding in equity or at law.
(d) Accuracy of Information. All information heretofore furnished in writing by the Seller to the Administrator, any Purchaser Agent or any Purchaser pursuant to or in connection with this Agreement or any other Transaction Document is, and all such information hereafter furnished by the Seller to the Administrator, any Purchaser Agent or any Purchaser in writing pursuant to this Agreement or any Transaction Document will be, taken as a whole, true and accurate in all material respects on the date such information is stated or certified; provided that with respect to projected financial information and information of a general economic or industry specific nature, the Seller represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time made.
(e) Actions, Suits. Except as set forth in Schedule III, there are no actions, suits or proceedings pending or, to the best of the Seller’s knowledge, threatened against or affecting the Seller or its properties, in or before any court, arbitrator or other body, which could reasonably be expected to have a Material Adverse Effect upon the ability of the Seller to perform its obligations under this Agreement or any other Transaction Document to which it is a party.
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(f) Accuracy of Exhibits; Lock-Box Arrangements. The names and addresses of all the Lock-Box Banks together with the account numbers of the Lock-Box Accounts at such Lock-Box Banks, are specified in Schedule II to this Agreement (or at such other Lock-Box Banks and/or with such other Lock-Box Accounts as have been notified to the Administrator), and all Lock-Box Accounts are subject to Lock-Box Agreements. All information on each Exhibit, Schedule or Annex to this Agreement or the other Transaction Documents (as updated by the Seller from time to time) is true and complete in all material respects. The Seller has delivered a copy of all Lock-Box Agreements to the Administrator. The Seller has not granted any interest in any Lock-Box Account (or any related lock-box or post office box) to any Person other than the Administrator and, upon delivery to a Lock-Box Bank of the related Lock-Box Agreement, the Administrator will have exclusive ownership and control of the Lock-Box Account at such Lock-Box Bank.
(g) No Material Adverse Effect. Since the date of formation of Seller as set forth in its certificate of formation, there has been no Material Adverse Effect with respect to the Seller.
(h) Names and Location. The Seller has not used any company names, trade names or assumed names other than its name set forth on the signature pages of this Agreement. The Seller is “located” (as such term is defined in the applicable UCC) in Delaware. The office where the Seller keeps its records concerning the Receivables is at the address set forth below its signature to this Agreement.
(i) Margin Stock. The Seller is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T, U and X, as issued by the Board of Governors of the Federal Reserve System), and no proceeds of any purchase or reinvestment hereunder will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock.
(j) Eligible Receivables. Each Pool Receivable included as an Eligible Receivable in the calculation of the Net Receivables Pool Balance is an Eligible Receivable.
(k) Credit and Collection Policy. The Seller has complied in all material respects with the Credit and Collection Policy of each Originator and the Transferor with regard to each Receivable originated by such Originator or the Transferor, as applicable.
(l) Investment Company Act. The Seller is neither (i) required to register as an “investment company,” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended nor (ii) is a “covered fund” under Section 13 of the U.S. Bank Holding Company Act of 1956, as amended, and the applicable rules and regulations thereunder.
(m) Mortgages Covering As-Extracted Collateral. There are no mortgages that are effective as financing statements covering as-extracted collateral that constitutes Pool Assets and that name any Originator (or, if such Originator is not the “record owner” of the underlying property, any “record owner” with respect to such as-extracted collateral, as such term is used in the UCC) as grantor, debtor or words of similar effect filed or recorded in any jurisdiction.
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(n) Anti-Money Laundering/International Trade Law Compliance. No Covered Entity is a Sanctioned Person. No Covered Entity, either in its own right or through any third party, (a) has any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law; (b) does business in or with, or derives any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law; or (c) engages in any dealings or transactions prohibited by any Anti-Terrorism Law.
2. Representations and Warranties of the Servicer. The Servicer represents and warrants to the Administrator, each Purchaser Agent and each Purchaser as of the Closing Date that:
(a) Existence and Power. The Servicer is a corporation duly formed, validly existing and in good standing under the laws of the State of Delaware, and has all company power and all governmental licenses, authorizations, consents and approvals required to carry on its business in each jurisdiction in which its business is conducted, except if failure to have such licenses, authorizations, consents or approvals would not reasonably be expected to have a Material Adverse Effect.
(b) Company and Governmental Authorization, Contravention. The execution, delivery and performance by the Servicer of this Agreement and each other Transaction Document to which it is a party (i) are within the Servicer’s organizational powers, have been duly authorized by all necessary organizational action, require no action by or in respect of, or filing with, any governmental body, agency or official, (ii) except as would not reasonably be expected to have a Material Adverse Effect, do not contravene, or constitute a default under, any provision of Applicable Law or of the certificate of incorporation or bylaws of the Servicer or of any judgment, injunction, order or decree or agreement or other instrument binding upon the Servicer and (iii) do not result in the creation or imposition of any lien on assets of the Servicer (other than in favor of the Administrator under the Transaction Documents) or any of its Subsidiaries.
(c) Binding Effect of Agreement. This Agreement and each other Transaction Document to which it is a party constitutes the legal, valid and binding obligation of the Servicer enforceable against the Servicer in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity, regardless of whether enforceability is considered in a proceeding in equity or at law.
(d) Accuracy of Information. All information heretofore furnished in writing by the Servicer to the Administrator, any Purchaser Agent or any Purchaser pursuant to or in connection with this Agreement or any other Transaction Document is, and all such information hereafter furnished by the Servicer to the Administrator, any Purchaser Agent or any Purchaser in writing pursuant to this Agreement or any other Transaction Document will be, taken as a whole, true and accurate in all material respects on the date such information is stated or certified; provided that with respect to projected financial information and information of a general economic or industry specific nature, the Servicer represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time made.
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(e) Actions, Suits. Except as set forth in Schedule III, there are no actions, suits or proceedings pending or, to the best of the Servicer’s knowledge, threatened against or affecting the Servicer or ACI or any of its Subsidiaries or their respective properties, in or before any court, arbitrator or other body, which could reasonably be expected to have a Material Adverse Effect upon the ability of the Servicer (or such Affiliate) to perform its obligations under this Agreement or any other Transaction Document to which it is a party.
(f) No Material Adverse Effect. Since the Closing Date, there has been no Material Adverse Effect on the Servicer.
(g) Credit and Collection Policy. The Servicer has complied in all material respects with the Credit and Collection Policy of each Originator and the Transferor with regard to each Receivable originated by such Originator or the Transferor, as applicable.
(h) Investment Company Act. The Servicer is not an “investment company,” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.
(i) Lock-Box Accounts. On or prior to the Closing Date, the Servicer has transferred and assigned all of its right, title and interest in and to, and remedies, powers and privileges under, the Lock-Box Accounts to the Seller.
(j) Anti-Money Laundering/International Trade Law Compliance. No Covered Entity is a Sanctioned Person. No Covered Entity, either in its own right or through any third party, (a) has any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law; (b) does business in or with, or derives any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law; or (c) engages in any dealings or transactions prohibited by any Anti-Terrorism Law.
(k) Effectiveness of Orders. The Confirmation Order is in full force and effect and has not been vacated or reversed, is not subject to a stay, and has not been modified or amended (other than any amendment or modification approved in writing by the Administrator and the Majority Purchaser Agents in their sole discretion).
3. Representations, Warranties and Agreements Relating to the Security Interest. The Seller hereby makes the following representations, warranties and agreements with respect to the Receivables and Related Security:
(a) The Receivables.
(i) Creation. This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables included in the Receivables Pool in favor of the Administrator (for the benefit of the Secured Parties), which security interest is prior to all other Adverse Claims, and is enforceable as such as against creditors of and purchasers from the Seller.
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(ii) Nature of Receivables. The Receivables included in the Receivables Pool constitute either “accounts” (including, without limitation, “accounts” constituting “as-extracted collateral”), “general intangibles” or “tangible chattel paper” within the meaning of the applicable UCC.
(iii) Ownership of Receivables. The Seller owns and has good and marketable title to the Receivables included in the Receivables Pool and Related Security free and clear of any Adverse Claim.
(iv) Perfection and Related Security. The Seller has caused (and shall have caused each Originator and the Transferor to cause) the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions under Applicable Law in order to perfect the sale of the Receivables and Related Security from such Originator to the Transferor pursuant to the Purchase and Sale Agreement and in order to perfect the sale from the Transferor to the Seller pursuant to the Sale and Contribution Agreement, and the sale and security interest therein from the Seller to the Administrator under this Agreement, to the extent that such collateral constitutes “accounts” (including, without limitation, “accounts” constituting “as-extracted collateral”), “general intangibles,” or “tangible chattel paper.”
(v) Tangible Chattel Paper. With respect to any Receivables included in the Receivables Pool that constitute “tangible chattel paper”, if any, the Seller (or the Servicer on its behalf) has in its possession the original copies of such tangible chattel paper that constitute or evidence such Receivables. The Receivables to the extent they are evidenced by “tangible chattel paper” do not have any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person other than the Seller or the Administrator.
| (b) | The Lock-Box Accounts. |
(i) Nature of Accounts. Each Lock-Box Account constitutes a “deposit account” within the meaning of the applicable UCC.
(ii) Ownership. The Seller owns and has good and marketable title to the Lock-Box Accounts free and clear of any Adverse Claim.
(iii) Perfection. The Seller has delivered to the Administrator a fully executed Lock-Box Agreement relating to each Lock-Box Account, pursuant to which each applicable Lock-Box Bank, respectively, has agreed, following the occurrence and continuation of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, to comply with all instructions originated by the Administrator (on behalf of the Secured Parties) directing the disposition of funds in such Lock-Box Account without further consent by the Seller or the Servicer.
| (c) | Priority. |
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(i) Other than the transfer of the Receivables to the Transferor, the Seller and the Administrator under the Purchase and Sale Agreement, the Sale and Contribution Agreement and this Agreement, respectively, and/or the security interest granted to the Transferor, the Seller and the Administrator pursuant to the Purchase and Sale Agreement, the Sale and Contribution Agreement and this Agreement, respectively, neither the Transferor, the Seller nor any Originator has pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Receivables transferred or purported to be transferred under the Transaction Documents, the Lock-Box Accounts or any subaccount thereof, except for any such pledge, grant or other conveyance which has been or will be released or terminated. Neither the Seller, the Transferor nor any Originator has authorized the filing of, or is aware of any financing statements against any of the Seller, the Transferor or such Originator that include a description of Receivables transferred or purported to be transferred under the Transaction Documents, the Lock-Box Accounts or any subaccount thereof, other than any financing statement (i) relating to the sale thereof by such Originator to the Transferor under the Purchase and Sale Agreement or relating to the sale thereof by the Transferor to the Seller under the Sale and Contribution Agreement or (ii) relating to the security interest granted to the Administrator under this Agreement.
(ii) The Seller is not aware of any judgment, ERISA or tax lien filings against either the Seller, the Servicer, the Transferor, any Originator, ACI, or any of their ERISA Affiliates other than such judgment, ERISA or tax lien filing that (x)(A) has not been outstanding for greater than 30 days from the earlier of such Person’s knowledge or notice thereof, (B) is less than $250,000 and (C) does not otherwise give rise to a Termination Event under clause (l) of Exhibit V hereto or (y) as to which no enforcement collection, execution, levy or foreclosure proceeding shall have been commenced or threatened and that solely secures the payment of taxes, if and to the extent the taxes are either (A) not yet due and payable or (B) being contested in good faith and as to which adequate reserves have been provided in accordance with generally accepted accounting principles, but, in any case, only to the extent such lien securing payment of such taxes constitutes an inchoate tax lien.
(iii) The Lock-Box Accounts are not in the name of any person other than the Seller or the Administrator. Neither the Seller nor the Servicer has consented to any bank maintaining such account to comply with instructions of any person other than the Administrator.
(d) Survival of Supplemental Representations. Notwithstanding any other provision of this Agreement or any other Transaction Document, the representations contained in this Section shall be continuing, and remain in full force and effect until the Final Payout Date.
(e) No Waiver. To the extent required pursuant to the securitization program of any Conduit Purchaser, the parties to this Agreement: (i) shall not, without obtaining a confirmation of the then-current rating of the Notes, waive any of the representations set forth in this Section;
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(ii) shall provide the Ratings Agencies with prompt written notice of any breach of any representations set forth in this Section, and shall not, without obtaining a confirmation of the then-current rating of the Notes (as determined after any adjustment or withdrawal of the ratings following notice of such breach) waive a breach of any of the representations set forth in this Section.
(f) Servicer to Maintain Perfection and Priority. In order to evidence the interests of the Administrator under this Agreement, the Servicer shall, from time to time take such action, or execute and deliver such instruments as may be necessary (including, without limitation, such actions as are reasonably requested by the Administrator) to maintain and perfect, as a first-priority interest, the Administrator’s security interest in the Receivables, Related Security and Collections. The Servicer shall, from time to time and within the time limits established by law, prepare and present to the Administrator for the Administrator’s authorization and approval, all financing statements, amendments, continuations or initial financing statements in lieu of a continuation statement, or other filings necessary to continue, maintain and perfect the Administrator’s security interest as a first-priority interest. The Administrator’s approval of such filings shall authorize the Servicer to file such financing statements under the UCC without the signature of the Seller, any Originator, the Transferor or the Administrator where allowed by Applicable Law. Notwithstanding anything else in the Transaction Documents to the contrary, the Servicer shall not have any authority prior to the Final Payout Date to file a termination, partial termination, release, partial release, or any amendment that deletes the name of a debtor or excludes collateral of any such financing statements filed in connection with the Transaction Documents, without the prior written consent of the Administrator.
(g) Mining Operations and Mineheads. The Servicer shall (and shall cause each applicable Originator to) promptly, and in any event within 30 days of any change, deletion or addition to the location of any Originator’s mining operations or mineheads set forth on Schedule V to the Purchase and Sale Agreement, (i) notify the Administrator and each Purchaser Agent of such change, deletion or addition, (ii) cause the filing or recording of such financing statements and amendments and/or releases to financing statements, mortgages or other instruments, if any, necessary to preserve and maintain the perfection and priority of the security interest of the Transferor, Seller and Administrator (on behalf of the Secured Parties) in the Pool Assets pursuant to this Agreement, in each case in form and substance reasonably satisfactory to the Administrator and (iii) deliver to the Administrator and each Purchaser Agent an updated Schedule V to the Purchase and Sale Agreement reflecting such change, deletion or addition; it being understood that no Receivable the related location of mining operations and/or mineheads of which is not as set forth on Schedule V to the Purchase and Sale Agreement as of the Closing Date shall be an Eligible Receivable until such time as each condition under this clause (g) shall have been satisfied (and upon such satisfaction, the Purchase and Sale Agreement shall be deemed amended to reflect such updated Schedule V to the Purchase and Sale Agreement).
(h) Additional Mortgages Under Credit Agreement. The Servicer shall (and shall cause each applicable Originator to) (x) provide written notice promptly, and in any event within 30 days, to the Seller, the Administrator and each Purchaser Agent of each new Mortgage or amendment or modification of an existing Mortgage under any Credit Agreement covering as-extracted collateral and (y) file or record all amendments and/or releases to such new, amended or modified Mortgages necessary to release and remove of record any such security interest, lien or other interest of the related grantee or beneficiary in the Receivables, Contracts and Related Security, in each case in form and substance satisfactory to the Administrator.
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4. Ordinary Course of Business. Seller represents and warrants that each remittance of Collections by or on behalf of the Seller to the Purchasers under this Agreement will have been (i) in payment of a debt incurred by the Seller in the ordinary course of business or financial affairs of the Seller and (ii) made in the ordinary course of business or financial affairs of the Seller.
5. Reaffirmation of Representations and Warranties. On the date of each purchase and/or reinvestment and issuance of a Letter of Credit hereunder, and on the date each Information Package or Interim Report is delivered to the Administrator, any Purchaser Agent or any Purchaser hereunder, the Seller and the Servicer, by accepting the proceeds of such purchase reinvestment or Letter of Credit, as applicable and/or the provision of such Information Package or Interim Report, shall each be deemed to have certified that (i) all representations and warranties of the Seller and the Servicer, as applicable, described in this Exhibit III, as from time to time amended in accordance with the terms hereof, are correct in all material respects on and as of such day as though made on and as of such day, except for representations and warranties which apply as to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such date), and (ii) no event has occurred and is continuing, or would result from any such purchase, reinvestment or issuance, which constitutes a Termination Event or an Unmatured Termination Event.
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EXHIBIT IV
COVENANTS
1. Covenants of the Seller. At all times from the date hereof until the Final Payout Date:
(a) Financial Reporting. The Seller will maintain a system of accounting established and administered in accordance with generally accepted accounting principles as in effect in the appropriate jurisdiction, and the Seller (or the Servicer on its behalf) shall furnish to the Administrator and each Purchaser Agent:
(i) Annual Reporting. Promptly upon completion and in no event later than 90 days after the close of each fiscal year of the Seller, annual unaudited financial statements of the Seller certified by a designated financial or other officer of the Seller.
(ii) Reports. (A) As soon as available and in any event not later than two Business Days prior to the Monthly Settlement Date, an Information Package as of the most recently completed calendar month, (B) if requested by the Administrator or any Purchaser at any time following the occurrence and during the continuance of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, a report substantially in the form of Annex H-1 (each, a “Weekly Report”) no later than the second Business Day of each calendar week as of the most recently completed calendar week, which shall include, among other things, the Liquidity as of the last day of such calendar week, and (C) if requested by the Administrator or any Purchaser at any time following the occurrence and during the continuance of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, a report substantially in the form of Annex H-2 (each, a “Daily Report”) on each Business Day as of the date that is one Business Day prior to such date.
(iii) Cash Flow Forecasts. During each Minimum Liquidity Period, from time to time a report substantially in the form of Annex J (a “Cash Flow Forecast”) promptly (but in any event no later than 10 Business Days) following the request therefore from the Administrator or any Purchaser.
(iv) Other Information. Such other information (including non-financial information) as the Administrator or any Purchaser Agent may from time to time reasonably request.
(b) Notices. The Seller will notify the Administrator and each Purchaser Agent in writing of any of the following events promptly upon (but in no event later than three Business Days after) a financial or other officer learning of the occurrence thereof, with such notice describing the same, and if applicable, the steps being taken by the Person(s) affected with respect thereto:
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(i) Notice of Termination Events or Unmatured Termination Events. A statement of the chief financial officer or chief accounting officer of the Seller setting forth details of any Termination Event or Unmatured Termination Event and the action which the Seller proposes to take with respect thereto.
(ii) Representations and Warranties. The failure of any representation or warranty to be true and correct (when made or at any time thereafter) with respect to the Receivables included in the Receivables Pool.
(iii) Litigation. The institution of any litigation, arbitration proceeding or governmental proceeding which may have a Material Adverse Effect on the Seller.
(iv) Adverse Claim. (A) Any Person shall obtain an Adverse Claim upon the Pool Receivables or Collections with respect thereto, (B) any Person other than the Seller, the Servicer or the Administrator shall obtain any rights or direct any action with respect to any Lock-Box Account (or related lock-box or post office box) or (C) any Obligor shall receive any change in payment instructions with respect to Pool Receivable(s) from a Person other than the Servicer or the Administrator.
(v) ERISA and Other Claims. Promptly after the filing or receiving thereof, copies of all reports and notices that the Seller or any ERISA Affiliate files under ERISA with the Internal Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department of Labor or that the Seller or any ERISA Affiliate receives from any of the foregoing or from any multiemployer plan (within the meaning of Section 4001(a)(3) of ERISA) to which the Seller or any of its ERISA Affiliates is or was, within the preceding five years, a contributing employer, in each case in respect of the assessment of withdrawal liability or an event or condition that could, in the aggregate, result in the imposition of liability on the Seller and/or any such ERISA Affiliate.
(vi) Name Changes. At least ten days before any change in the Seller’s name, jurisdiction of organization or any other change requiring the amendment of UCC financing statements, a notice setting forth such changes and the effective date thereof.
(vii) Material Adverse Change. Promptly after the occurrence thereof, notice of a material adverse change in the business, operations, property or financial or other condition of the Seller, the Servicer, the Transferor or any Originator.
(c) Conduct of Business. The Seller will carry on and conduct its business in substantially the same manner and in substantially the same fields of enterprise as it is presently conducted and will do all things necessary to remain duly organized, validly existing and in good standing as a domestic organization in its jurisdiction of organization and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted.
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(d) Compliance with Laws. The Seller will comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to which it may be subject, except where failure to do so would not reasonably be expected to have a Material Adverse Effect.
(e) Furnishing of Information and Inspection of Receivables. The Seller will furnish to the Administrator and each Purchaser Agent from time to time such information with respect to the Pool Receivables as the Administrator or any Purchaser Agent may reasonably request. The Seller will, at the Seller’s expense, during regular business hours with prior written notice (i) permit the Administrator and/or any Purchaser Agent, or their respective agents or representatives, (A) to examine and make copies of and abstracts from all books and records relating to the Pool Receivables or other Pool Assets and (B) to visit the offices and properties of the Seller for the purpose of examining such books and records, and to discuss matters relating to the Pool Receivables, other Pool Assets or the Seller’s performance hereunder or under the other Transaction Documents to which it is a party with any of the officers, directors, employees or independent public accountants of the Seller (provided that representatives of the Seller are present during such discussions) having knowledge of such matters and (ii) without limiting the provisions of clause (i) above, during regular business hours, at the Seller’s expense, upon prior written notice from the Administrator and/or such Purchaser Agent, permit certified public accountants or other auditors acceptable to the Administrator to conduct a review of its books and records with respect to such Receivables; provided, that unless a Termination Event has occurred and is continuing, the Seller shall be required to reimburse the Administrator and Purchaser Agents for only one (1) such audit per year.
(f) Payments on Receivables, Accounts. The Seller will, and will cause each Originator and the Transferor to, at all times instruct all Obligors to deliver payments on the Pool Receivables to (A) a Lock-Box Account or (B) so long as each of the Exception Account Conditions are then satisfied, an Exception Account. The Servicer shall, and shall cause each Originator to, remit all Collections received in any Exception Account directly to a Lock-Box Account no later than one (1) Business Day following receipt thereof. If any such payments or other Collections are received by the Seller, an Originator or the Transferor, it shall hold such payments in trust for the benefit of the Administrator and the Purchasers and promptly (but in any event within two Business Days after receipt) remit such funds into a Lock-Box Account; provided that any Collections received in an Exception Account shall be directly transferred to a Lock-Box Account no later than one (1) Business Day following receipt thereof. The Seller will cause each Lock-Box Bank to comply with the terms of each applicable Lock-Box Agreement. The Seller will, unless otherwise agreed in writing by the Administrator, instruct each Originator, in its capacity as the beneficiary (or prospective beneficiary) of an Eligible Supporting Letter of Credit, to instruct the related Eligible Supporting Letter of Credit Provider to make payments in respect of Eligible Supporting Letters of Credit issued (or confirmed by) such Eligible Supporting Letter of Credit Provider directly to a Lock-Box Account if the Servicer fails to do so and, if an Eligible Supporting Letter of Credit Provider fails to so deliver payments to a Lock-Box Account, the Seller will, unless otherwise agreed in writing by the Administrator, use all reasonable efforts to cause the applicable Originator to cause such Eligible Supporting Letter of Credit Provider to deliver subsequent payments (if any) in respect of Eligible Supporting Letters of Credit issued (or confirmed by) such Eligible Supporting Letter of Credit Provider directly to a Lock-Box Account if the Servicer fails to do so. The Seller will not permit the funds other than Collections on Pool
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Receivables and other Pool Assets to be deposited into any Lock-Box Account. If such funds are nevertheless deposited into any Lock-Box Account, the Seller will within two Business Days identify such funds for segregation. The Seller will not, and will not permit the Servicer, any Originator or the Transferor or other Person to, commingle Collections or other funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled with any other funds. The Seller shall only add, and shall only permit an Originator or the Transferor to add, a Lock-Box Bank (or the related lock-box or post office box), or Lock-Box Account to those listed on Schedule II to this Agreement, if the Administrator has received notice of such addition, a copy of any new Lock-Box Agreement and an executed and acknowledged copy of a Lock-Box Agreement (or an amendment thereto) in form and substance reasonably acceptable to the Administrator from the applicable Lock-Box Bank. The Seller shall only terminate a Lock-Box Bank or close a Lock-Box Account (or the related lock-box or post office box), with the prior written consent of the Administrator.
(g) Sales, Liens, etc. Except as otherwise provided herein, the Seller will not sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim upon (including, without limitation, the filing of any financing statement) or with respect to, any Pool Receivable or other Pool Asset, or assign any right to receive income in respect thereof.
(h) Extension or Amendment of Pool Receivables. Except as otherwise permitted in Section 4.2 of this Agreement, the Seller will not, and will not permit the Servicer to, alter the delinquency status or adjust the Outstanding Balance or otherwise modify the terms of any Pool Receivable in any material respect, or amend, modify or waive, in any material respect, any term or condition of any related Contract (which term or condition relates to payments under, or the enforcement of, such Contract). The Seller shall at its expense, timely and fully perform and comply with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Pool Receivables, and timely and fully comply with the Credit and Collection Policy with regard to each Receivable and the related Contract (which term or condition relates to payments under, or the enforcement of, such Contract).
(i) Change in Business. The Seller will not (i) make any change in the character of its business or (ii) make any change in any Credit and Collection Policy that could reasonably be expected to have a Material Adverse Effect, in the case of either clause (i) or (ii) above, without the prior written consent of the Administrator and the Majority Purchaser Agents. The Seller shall not make any other written change in any Credit and Collection Policy without giving prior written notice thereof to the Administrator and each Purchaser Agent.
(j) Fundamental Changes. The Seller shall not, without the prior written consent of the Administrator and the Majority Purchaser Agents, permit itself (i) to merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person or (ii) to be owned by any Person other than ACI and thereby cause ACI’s percentage of ownership or control of the Seller to be reduced. The Seller shall provide the Administrator and each Purchaser with at least 10 days’ prior written notice before making any change in the Seller’s name, location or making any other change in the Seller’s identity or corporate structure that could
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impair or otherwise render any UCC financing statement filed in connection with this Agreement or any other Transaction Document “seriously misleading” as such term (or similar term) is used in the applicable UCC; each notice to the Administrator and the Purchaser Agents pursuant to this sentence shall set forth the applicable change and the proposed effective date thereof. The Seller will also maintain and implement (or cause the Servicer to maintain and implement) administrative and operating procedures (including an ability to recreate records evidencing Pool Receivables and related Contracts in the event of the destruction of the originals thereof), and keep and maintain (or cause the Servicer to keep and maintain) all documents, books, records, computer tapes and disks and other information reasonably necessary or advisable for the collection of all Pool Receivables (including records adequate to permit the daily identification of each Pool Receivable and all Collections of and adjustments to each existing Pool Receivable).
(k) Change in Payment Instructions to Obligors. The Seller shall not (and shall not cause the Servicer or any Sub-Servicer to) add to, replace or terminate any of the Lock-Box Accounts (or any related lock-box or post office box) listed in Schedule II hereto or make any change in its (or their) instructions to the Obligors regarding payments to be made to the Lock-Box Accounts (or any related lock-box or post office box), unless the Administrator shall have received (x) prior written notice of such addition, termination or change and (y) a signed and acknowledged Lock-Box Agreement (or amendment thereto) with respect to such new Lock-Box Accounts (or any related lock-box or post office box).
(l) Ownership Interest, Etc. The Seller shall (and shall cause the Servicer to), at its expense, take all action necessary or reasonably desirable to establish and maintain a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, in the Pool Receivables, the Related Security and Collections with respect thereto, and a first priority perfected security interest in the Pool Assets, in each case free and clear of any Adverse Claim, in favor of the Administrator (on behalf of the Secured Parties), including taking such action to perfect, protect or more fully evidence the interest of the Administrator (on behalf of the Secured Parties) as the Administrator or any Purchaser may reasonably request.
(m) Certain Agreements. Without the prior written consent of the Administrator and the Majority Purchaser Agents, the Seller will not (and will not permit the Originators or the Transferor to) amend, modify, waive, revoke or terminate any Transaction Document to which it is a party or any provision of the Seller’s organizational documents which requires the consent of the “Independent Director” (as defined in the Seller’s LLC Agreement).
(n) Restricted Payments. (i) Except pursuant to clause (ii) below, the Seller will not: (A) purchase or redeem any shares of its capital stock, (B) declare or pay any dividend or set aside any funds for any such purpose, (C) prepay, purchase or redeem any Debt, (D) lend or advance any funds or (E) repay any loans or advances to, for or from any of its Affiliates (the amounts described in clauses (A) through (E) being referred to as “Restricted Payments”).
(ii) Subject to the limitations set forth in clause (iii) below, the Seller may make Restricted Payments so long as such Restricted Payments are made only in one or more of the following ways: (A) the Seller may make cash payments (including prepayments) on the Company Notes in accordance with their respective terms, and (B) if no amounts are then outstanding under any Company Note, the Seller may declare and pay dividends.
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(iii) The Seller may make Restricted Payments only out of the funds, if any, it receives pursuant to Sections 1.4(b)(ii) and (iv) and 1.4(d) of this Agreement. Furthermore, the Seller shall not pay, make or declare: (A) any dividend if, after giving effect thereto, the Tangible Net Worth of the Seller would be less than $5,000,000, or (B) any Restricted Payment (including any dividend) if, after giving effect thereto, any Termination Event or Unmatured Termination Event shall have occurred and be continuing.
(o) Other Business. The Seller will not: (i) engage in any business other than the transactions contemplated by the Transaction Documents, (ii) create, incur or permit to exist any Debt of any kind (or cause or permit to be issued for its account any letters of credit or bankers’ acceptances) other than pursuant to this Agreement or the Company Notes, or (iii) form any Subsidiary or make any investments in any other Person.
(p) Use of Seller’s Share of Collections. The Seller shall apply the Seller’s Share of Collections to make payments in the following order of priority: (i) the payment of its expenses (including all obligations payable to the Purchasers, Purchaser Agents and the Administrator under this Agreement and under the Fee Letters), (ii) the payment of accrued and unpaid interest on the Company Notes and (iii) other legal and valid organizational purposes.
(q) Further Assurances; Change in Name or Jurisdiction of Origination, etc. (i) The Seller hereby authorizes and hereby agrees from time to time, at its own expense, promptly to execute (if necessary) and deliver all further instruments and documents, and to take all further actions, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or more fully evidence the purchases or issuances made under this Agreement and/or security interest granted pursuant to this Agreement or any other Transaction Document, or to enable the Administrator (on behalf of the Secured Parties) to exercise and enforce the Purchasers’ rights and remedies under this Agreement and any other Transaction Document. Without limiting the foregoing, the Seller hereby authorizes, and will, upon the request of the Administrator, at the Seller’s own expense, execute (if necessary) and file such financing or continuation statements (including fixture filings and as extracted collateral filings), or amendments thereto, and such other instruments and documents, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or evidence any of the foregoing.
(i) The Seller authorizes the Administrator to file financing or continuation statements, and amendments thereto and assignments thereof, relating to the Receivables and the Related Security, the related Contracts and the Collections with respect thereto and the other collateral subject to a lien under any Transaction Document without the signature of the Seller. A photocopy or other reproduction of this Agreement shall be sufficient as a financing statement where permitted by law.
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(ii) The Seller shall at all times be organized under the laws of the State of Delaware and shall not take any action to change its jurisdiction of organization.
(iii) The Seller will not change its name, location, identity or corporate structure unless (x) the Administrator and each Purchaser Agent shall have received at least thirty (30) days’ advance written notice of such change, (y) the Seller, at its own expense, shall have taken all action necessary or appropriate to perfect or maintain the perfection of the lien under this Agreement (including, without limitation, the filing of all financing statements and the taking of such other action as the Administrator may request in connection with such change or relocation), and (z) if requested by the Administrator or any Purchaser, the Seller shall cause to be delivered to the Administrator or any Purchaser Agent, an opinion, in form and substance reasonably satisfactory to the Administrator and such Purchaser Agent as to such UCC perfection and priority matters as such Person may request at such time.
(r) Tangible Net Worth. The Seller will not permit its Tangible Net Worth, at any time, to be less than $5,000,000.
(s) Anti-Money Laundering/International Trade Law Compliance. No Covered Entity will become a Sanctioned Person. No Covered Entity, either in its own right or through any third party, will (a) have any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law; (b) do business in or with, or derive any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law; (c) engage in any dealings or transactions prohibited by any Anti-Terrorism Law or (d) use the proceeds of any Purchase to fund any operations in, finance any investments or activities in, or, make any payments to, a Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law. The funds used to repay Seller’s obligations under this Agreement and each of the other Transaction Documents will not be derived from any unlawful activity. Each Covered Entity shall comply with all Anti-Terrorism Laws. Seller shall promptly notify the Administrator in writing upon the occurrence of a Reportable Compliance Event.
(t) Seller’s Tax Status. The Seller will remain a wholly-owned subsidiary of a United States person (within the meaning of Section 7701(a)(30) of the Internal Revenue Code) and not be subject to withholding under Section 1446 of the Internal Revenue Code. No action will be taken that would cause the Seller to (i) be treated other than as a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3 for U.S. federal income tax purposes or (ii) become an association taxable as a corporation or a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes.
(u) Other Additional Information. The Seller will provide to the Administrator and each Purchaser Agent such information and documentation as may reasonably be requested by the Administrator and each Purchaser Agent from time to time for purposes of compliance by the Administrator and each Purchaser Agent with applicable laws (including without limitation the USA Patriot Act and other “know your customer” and anti-money laundering rules and regulations), and any policy or procedure implemented by the Administrator and each Purchaser Agent to comply therewith.
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2. Covenants of the Servicer. At all times from the date hereof until the Final Payout Date:
(a) Financial Reporting. The Servicer will maintain a system of accounting established and administered in accordance with generally accepted accounting principles as in effect in the appropriate jurisdiction, and the Servicer shall furnish to the Administrator and each Purchaser Agent:
(i) Compliance Certificates. (a) A compliance certificate promptly upon completion of the annual report of the Performance Guarantor and in no event later than 90 days after the close of the Performance Guarantor’s fiscal year, in form and substance substantially similar to Annex D signed by its chief accounting officer or treasurer solely in their capacities as officers of the Servicer stating that no Termination Event or Unmatured Termination Event exists, or if any Termination Event or Unmatured Termination Event exists, stating the nature and status thereof, and (b) within 45 days after the close of each fiscal quarter of the Servicer, a compliance certificate in form and substance substantially similar to Annex D.
(ii) Reports. (A) As soon as available and in any event not later than two Business Days prior to the Monthly Settlement Date, an Information Package as of the most recently completed calendar month, (B) if requested by the Administrator or any Purchaser at any time following the occurrence and during the continuance of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, a Weekly Report no later than the second Business Day of each calendar week as of the most recently completed calendar week, which shall include, among other things, the Liquidity as of the last day of such calendar week, and (C) if requested by the Administrator or any Purchaser at any time following the occurrence and during the continuance of a Termination Event or Unmatured Termination Event or during a Minimum Liquidity Period, a Daily Report on each Business Day as of the date that is one Business Day prior to such date.
(iii) Cash Flow Forecasts. During each Minimum Liquidity Period, a Cash Flow Forecast from time to time promptly (but in any event no later than 5 Business Days) following the request therefore from the Administrator or any Purchaser.
(iv) Other Information. Such other information (including non-financial information) as the Administrator or any Purchaser Agent may from time to time reasonably request.
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(v) Annual Reporting. Promptly upon completion and in no event later than 90 days after the close of each fiscal year of ACI, the annual audited financial statements of ACI and its consolidated Subsidiaries certified by independent certified public accountants of nationally recognized standing (which shall be free of qualifications (other than any consistency qualification that may result from a change in the method used to prepare the financial statements as to which such accountants concur)), prepared in accordance with GAAP (after giving effect to Fresh Start Reporting, as applicable), including consolidated balance sheets as of the end of such period, consolidated statements of income, related profit and loss and reconciliation of surplus statements, and a statement of changes in financial position.
(b) Notices. The Servicer will notify the Administrator and each Purchaser Agent in writing of any of the following events promptly upon (but in no event later than three Business Days after) a financial or other officer learning of the occurrence thereof, with such notice describing the same, and if applicable, the steps being taken by the Person(s) affected with respect thereto:
(i) Notice of Termination Events or Unmatured Termination Events. A statement of the chief financial officer or chief accounting officer of the Servicer setting forth details of any Termination Event or Unmatured Termination Event and the action which the Servicer proposes to take with respect thereto.
(ii) Representations and Warranties. The failure of any representation or warranty to be true and correct (when made or at any time thereafter) with respect to the Receivables included in the Receivables Pool.
(iii) Litigation. The institution of any litigation, arbitration proceeding or governmental proceeding which could reasonably be expected to have a Material Adverse Effect on the Servicer.
(iv) Adverse Claim. (A) Any Person shall obtain an Adverse Claim upon the Pool Receivables or Collections with respect thereto, (B) any Person other than the Seller, the Servicer or the Administrator shall obtain any rights or direct any action with respect to any Lock-Box Account (or related lock-box or post office box) or (C) any Obligor shall receive any change in payment instructions with respect to Pool Receivable(s) from a Person other than the Servicer or the Administrator.
(v) ERISA. Promptly after the filing or receiving thereof notice of and, upon the request of the Administrator, copies of all reports and notices that ACI or any ERISA Affiliate of ACI files under ERISA with the Internal Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department of Labor or that such Person or any of its ERISA Affiliates receives from any of the foregoing or from any multiemployer plan (within the meaning of Section 4001(a)(3) of ERISA) to which such Person or any ERISA Affiliate of ACI is or was, within the preceding five years, a contributing employer, in each case in respect of the assessment of withdrawal liability or an event or condition that could, in the aggregate, result in the imposition of liability on ACI and/or any such ERISA Affiliate.
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(vi) Name Changes. At least ten days before any change in ACI’s, any Originator’s or the Transferor’s name or any other change requiring the amendment of UCC financing statements, a notice setting forth such changes and the effective date thereof.
(vii) Material Adverse Change. A material adverse change in the business, operations, property or financial or other condition of ACI or any Originator or the Transferor or any of their respective Subsidiaries.
(viii) Other Debt Default. A default or any event of default under (x) any Credit Agreement, or (y) any other financing arrangement evidencing $35,000,000 or more of indebtedness pursuant to which ACI, Arch Sales, any Originator, the Transferor or any of their Subsidiaries is a debtor or an obligor.
(ix) Permitted Merger. No later than 10 Business Days after the effective date of any Permitted Merger, a notice setting forth, in reasonable detail, the terms, conditions and Persons involved therein.
(c) Conduct of Business. The Servicer will carry on and conduct its business in substantially the same manner and in substantially the same fields of enterprise as it is presently conducted and will do all things necessary to remain duly incorporated, validly existing and in good standing as a domestic corporation in its jurisdiction of incorporation and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted if the failure to have such authority could reasonably be expected to have a Material Adverse Effect.
(d) Compliance with Laws. The Servicer will comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to which it may be subject if the failure to comply could reasonably be expected to have a Material Adverse Effect.
(e) Furnishing of Information and Inspection of Receivables. The Servicer will furnish to the Administrator and each Purchaser Agent from time to time such information with respect to the Pool Receivables as the Administrator or any Purchaser Agent may reasonably request. The Servicer will, at the Servicer’s expense, during regular business hours with prior written notice, (i) permit the Administrator and/or any Purchaser Agent, or their respective agents or representatives, (A) to examine and make copies of and abstracts from all books and records relating to the Pool Receivables or other Pool Assets, (B) to visit the offices and properties of the Servicer for the purpose of examining such books and records, and (C) to discuss matters relating to the Pool Receivables, other Pool Assets or the Servicer’s performance hereunder or under the other Transaction Documents to which it is a party with any of the officers, directors, employees or independent public accountants of the Servicer (provided that representatives of the Servicer are present during such discussions) having knowledge of such matters and (ii) without limiting the provisions of clause (i) above, during regular business hours, at the Servicer’s expense, upon prior
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written notice from the Administrator or such Purchaser Agent, permit certified public accountants or other auditors acceptable to the Administrator to conduct, a review of its books and records with respect to such Receivables; provided, that unless a Termination Event has occurred and is continuing, that the Servicer shall be required to reimburse the Administrator and the Purchaser Agents for only one (1) such audit per year.
(f) Payments on Receivables, Accounts. The Servicer will at all times instruct all Obligors to deliver payments on the Pool Receivables to (A) a Lock-Box Account or (B) so long as each of the Exception Account Conditions are then satisfied, an Exception Account. The Seller (or the Servicer on its behalf) shall, and shall cause each Originator to remit all Collections received in any Exception Account directly to a Lock-Box Account no later than one (1) Business Day following receipt thereof. The Servicer will, at all times, maintain such books and records necessary to identify Collections received from time to time on Pool Receivables and to segregate such Collections from other property of the Servicer, the Transferor and the Originators. If any such payments or other Collections are received by the Servicer, it shall hold such payments in trust for the benefit of the Administrator and the Purchasers and promptly (but in any event within two Business Days after receipt) remit such funds into a Lock-Box Account. The Servicer will cause each Lock-Box Bank to comply with the terms of each applicable Lock-Box Agreement. The Servicer will (on behalf of the Seller), unless otherwise agreed in writing by the Administrator, instruct each Originator, in its capacity as the beneficiary of an Eligible Supporting Letter of Credit, to instruct each Eligible Supporting Letter of Credit Provider to make payments in respect of Eligible Supporting Letters of Credit issued (or confirmed by) such Eligible Supporting Letter of Credit Provider directly to a Lock-Box Account if the applicable Originator fails to do so and, if an Eligible Supporting Letter of Credit Provider fails to so deliver payments to a Lock-Box Account, the Servicer will, unless otherwise agreed in writing by the Administrator, use all reasonable efforts to cause the applicable Originator to cause such Eligible Supporting Letter of Credit Provider to deliver subsequent payments (if any) in respect of Eligible Supporting Letters of Credit issued (or confirmed by) such Eligible Supporting Letter of Credit Provider directly to a Lock-Box Account if the applicable Originator fails to do so. The Servicer will not permit the funds other than Collections on Pool Receivables and other Pool Assets to be deposited into any Lock-Box Account. If such funds are nevertheless deposited into any Lock-Box Account, the Servicer will within two Business Days identify such funds for segregation. The Servicer will not commingle Collections or other funds to which the Administrator or any other Secured Party is entitled with any other funds. The Servicer shall only add, a Lock-Box Bank (or the related lock-box or post office box), or Lock-Box Account to those listed on Schedule II to this Agreement, if the Administrator has received notice of such addition, a copy of any new Lock-Box Agreement and an executed and acknowledged copy of a Lock-Box Agreement (or an amendment thereto) in form and substance acceptable to the Administrator from any such new Lock-Box Bank. The Servicer shall only terminate a Lock-Box Bank or close a Lock-Box Account (or the related lock-box or post office box) with the prior written consent of the Administrator.
(g) Extension or Amendment of Pool Receivables. Except as otherwise permitted in Section 4.2 of this Agreement, the Servicer will not alter the delinquency status or adjust the Outstanding Balance or otherwise modify the terms of any Pool Receivable in any material respect, or amend, modify or waive, in any material respect any term or condition of any related Contract (which term or condition relates to payments under, or the enforcement of, such Contract). The
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Servicer shall at its expense, timely and fully perform and comply with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Pool Receivables, and timely and fully comply with the Credit and Collection Policy with regard to each Pool Receivable and the related Contract (which term or condition relates to payments under, or the enforcement of, such Contract).
(h) Change in Business. The Servicer will not (i) make any material change in the character of its business or (ii) make any change in any Credit and Collection Policy that could reasonably be expected to have a Material Adverse Effect, in the case of either (i) or (ii) above, without the prior written consent of the Administrator and the Majority Purchaser Agents. The Servicer shall not make any written change in any Credit and Collection Policy without giving prior written notice thereof to the Administrator and each Purchaser Agent.
(i) Records. The Servicer will maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Pool Receivables and related Contracts in the event of the destruction of the originals thereof), and keep and maintain all documents, books, records, computer tapes and disks and other information reasonably necessary or advisable for the collection of all Pool Receivables (including records adequate to permit the daily identification of each Pool Receivable and all Collections of and adjustments to each existing Pool Receivable).
(j) Change in Payment Instructions to Obligors. The Servicer shall not (and shall not permit any Sub-Servicer to) add to, replace or terminate any of the Lock-Box Accounts (or any related lock-box or post office box) listed in Schedule II hereto or make any change in its instructions to the Obligors regarding payments to be made to the Lock-Box Accounts (or any related lock-box or post office box), unless the Administrator shall have received (x) prior written notice of such addition, termination or change and (y) a signed and acknowledged Lock-Box Agreement (or an amendment thereto) with respect to such new Lock-Box Accounts (or any related lock-box or post office box).
(k) Ownership Interest, Etc. The Servicer shall, at its expense, take all action necessary or reasonably desirable to establish and maintain a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, in the Pool Receivables, the Related Security and Collections with respect thereto, and a first priority perfected security interest in the Pool Assets, in each case free and clear of any Adverse Claim, in favor of the Administrator (on behalf of the Secured Parties), including taking such action to perfect, protect or more fully evidence the interest of the Administrator (on behalf of the Secured Parties) as the Administrator may reasonably request.
(l) Further Assurances; Change in Name or Jurisdiction of Origination, etc. The Servicer hereby authorizes and hereby agrees from time to time, at its own expense, promptly to execute (if necessary) and deliver all further instruments and documents, and to take all further actions, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or more fully evidence the purchases or issuances made under this Agreement and/or security interest granted pursuant to this Agreement or any other Transaction Document, or to enable the Administrator (on behalf of the Secured Parties) to exercise and enforce their
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respective rights and remedies under this Agreement or any other Transaction Document. Without limiting the foregoing, the Servicer hereby authorizes, and will, upon the request of the Administrator, at the Servicer’s own expense, execute (if necessary) and file such financing or continuation statements (including fixture filings and as extracted collateral filings), or amendments thereto, and such other instruments and documents, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or evidence any of the foregoing.
(i) The Servicer authorizes the Administrator to file financing or continuation statements, and amendments thereto and assignments thereof, relating to the Receivables and the Related Security, the related Contracts and the Collections with respect thereto and the other collateral subject to a lien under any Transaction Document without the signature of the Servicer. A photocopy or other reproduction of this Agreement shall be sufficient as a financing statement where permitted by law.
(ii) The Servicer shall at all times be organized under the laws of the State of Delaware and shall not take any action to change its jurisdiction of organization.
(iii) The Servicer will not change its name, location, identity or corporate structure unless (x) the Administrator and each Purchaser Agent shall have received at least ten (10) days’ advance written notice of such change, (y) the Servicer, at its own expense, shall have taken all action necessary or appropriate to perfect or maintain the perfection of the lien under this Agreement (including, without limitation, the filing of all financing statements and the taking of such other action as the Administrator may request in connection with such change or relocation), and (z) if requested by the Administrator or any Purchaser Agent, the Servicer shall cause to be delivered to the Administrator and each Purchaser Agent, an opinion, in form and substance satisfactory to the Administrator and each such Purchaser Agent as to such UCC perfection and priority matters as such Person may request at such time.
(m) Anti-Money Laundering/International Trade Law Compliance. No Covered Entity will become a Sanctioned Person. No Covered Entity, either in its own right or through any third party, will (a) have any of its assets in a Sanctioned Country or in the possession, custody or control of a Sanctioned Person in violation of any Anti-Terrorism Law; (b) do business in or with, or derive any of its income from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law; (c) engage in any dealings or transactions prohibited by any Anti-Terrorism Law or (d) use the proceeds of any Purchase to fund any operations in, finance any investments or activities in, or, make any payments to, a Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law. The funds used to repay Servicer’s obligations under this Agreement and each of the other Transaction Documents will not be derived from any unlawful activity. Each Covered Entity shall comply with all Anti-Terrorism Laws. Servicer shall promptly notify the Administrator in writing upon the occurrence of a Reportable Compliance Event.
IV-13
(n) Identifying of Records. The Servicer shall identify its master data processing records relating to Pool Receivables and related Contracts with a legend that indicates that the Pool Receivables have been pledged in accordance with this Agreement.
(o) Seller’s Tax Status. The Servicer shall not take or cause any action to be taken that could result in the Seller (i) being treated other than as a “disregarded entity” within the meaning of U.S. Treasury Regulation § 301.7701-3 for U.S. federal income tax purposes or (ii) becoming an association taxable as a corporation or a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes.
(p) Other Additional Information. The Servicer will provide to the Administrator and each Purchaser Agent such information and documentation as may reasonably be requested by the Administrator and each Purchaser Agent from time to time for purpose of compliance by the Administrator and each Purchaser Agent with applicable laws (including without limitation the USA Patriot Act and other “know your custom” and anti-money laundering rules and regulations), and any policy or procedure implemented by the Administrator and each Purchaser Agent to comply therewith.
3. Separate Existence. Each of the Seller and the Servicer hereby acknowledges that the Purchasers, the Purchaser Agents and the Administrator are entering into the transactions contemplated by this Agreement and the other Transaction Documents in reliance upon the Seller’s identity as a legal entity separate from ACI and its Affiliates. Therefore, from and after the date hereof, each of the Seller and ACI shall take all steps specifically required by this Agreement or reasonably required by the Administrator, any Purchaser Agent or any Purchaser to continue the Seller’s identity as a separate legal entity and to make it apparent to third Persons that the Seller is an entity with assets and liabilities distinct from those of ACI and any other Person, and is not a division of ACI, its Affiliates or any other Person. Without limiting the generality of the foregoing and in addition to and consistent with the other covenants set forth herein, each of the Seller and ACI shall take such actions as shall be required in order that:
(a) The Seller will be a limited liability company whose primary activities are restricted in its LLC Agreement to: (i) purchasing or otherwise acquiring from the Transferor, owning, holding, granting security interests or selling interests in Pool Assets, (ii) entering into agreements for the selling and servicing of the Receivables Pool, and (iii) conducting such other activities as it deems necessary or appropriate to carry out its primary activities;
(b) The Seller shall not engage in any business or activity except as set forth in this Agreement nor incur any indebtedness or liability other than as expressly permitted by the Transaction Documents;
(c) (i) Not less than one member of the Seller’s board of directors (the “Independent Director”) shall be a natural person (A) who is not, and has not been at any time during the five (5) years preceding such person’s initial appointment: (1) a direct, indirect or beneficial stockholder, equityholder, officer, director (other than the Independent Director), employee, member, manager, attorney, partner, affiliate, or supplier of Seller, ACI, Arch Sales, any Originator, the Transferor or any of their respective Subsidiaries (the “Arch Group”); provided,
IV-14
that indirect stock ownership of any member of the Arch Group by any person through a mutual fund or similar diversified investment pool shall not disqualify such person from being an Independent Director unless such person maintains direct or indirect control of the investment decisions of such mutual fund or similar diversified investment pool, (2) a customer of, supplier to or other person who derives more than 1% of its purchases or revenues from its activities with any member of the Arch Group; (3) a trustee, conservator or receiver for any member of the Arch Group; (4) a person or other entity controlling, controlled by or under common control with any such equity holder, partner, member, manager, customer, supplier or other person; or (5) a member of the immediate family of any such equityholder, director, officer, employee, member, manager, partner, customer, supplier or other person and (B) (1) who has (x) prior experience as an independent director for a corporation or an independent manager of a limited liability company whose charter documents required the unanimous consent of all independent director or independent managers thereof before such corporation could consent to the institution of bankruptcy or insolvency proceedings against it or could file a petition seeking relief under any applicable federal or state law relating to bankruptcy and (y) at least three years of employment experience with one or more entities that provide, in the ordinary course of their respective businesses, advisory, management or placement services to issuers of securitization or structured finance instruments, agreements or securities and (2) is reasonably acceptable to the Administrator and each Purchaser Agent (such acceptability of any Independent Director appointed after the date hereof must be evidenced in writing signed by the Administrator and each Purchaser Agent). Under this clause (c), the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise. (ii) The operating agreement of the Seller shall provide that: (A) the Seller’s board of managers or other governing body shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with respect to the Seller unless the Independent Director shall approve the taking of such action in writing before the taking of such action, and (B) such provision and each other provision requiring an Independent Director cannot be amended without the prior written consent of the Independent Director.
(d) The Independent Director shall not at any time serve as a trustee in bankruptcy for the Seller, ACI, any Originator, the Transferor or any of their respective Affiliates;
(e) The Seller shall maintain its organizational documents in conformity with this Agreement, such that it does not amend, restate, supplement or otherwise modify its ability to comply with the terms and provisions of any of the Transaction Documents, including, without limitation, clause (i) of Exhibit V;
(f) The Seller shall conduct its affairs strictly in accordance with its organizational documents and observe all necessary, appropriate and customary company formalities, including, but not limited to, holding all regular and special members’ and board of directors’ meetings appropriate to authorize all limited liability company action, keeping separate and accurate minutes of its meetings, passing all resolutions or consents necessary to authorize actions taken or to be taken, and maintaining accurate and separate books, records and accounts, including, but not limited to, payroll and intercompany transaction accounts;
IV-15
(g) Any employee, consultant or agent of the Seller will be compensated from the Seller’s funds for services provided to the Seller, and to the extent that Seller shares the same officers or other employees as ACI (or any other Affiliate thereof), the salaries and expenses relating to providing benefits to such officers and other employees shall be fairly allocated among such entities, and each such entity shall bear its fair share of the salary and benefit costs associated with such common officers and employees. The Seller will not engage any agents other than its attorneys, auditors and other professionals, and a servicer and any other agent contemplated by the Transaction Documents for the Receivables Pool, which servicer will be fully compensated for its services by payment of the Servicing Fee, and a manager, which manager will be fully compensated from the Seller’s funds;
(h) The Seller will contract with the Servicer to perform for the Seller all operations required on a daily basis to service the Receivables Pool. The Seller will pay the Servicer the Servicing Fee pursuant hereto. The Seller will not incur any indirect or overhead expenses for items shared with ACI (or any other Affiliate thereof) that are not reflected in the Servicing Fee. To the extent, if any, that the Seller (or any Affiliate thereof) shares items of expenses not reflected in the Servicing Fee or the manager’s fee, such as legal, auditing and other professional services, such expenses will be allocated to the extent practical on the basis of actual use or the value of services rendered, and otherwise on a basis reasonably related to the actual use or the value of services rendered; it being understood that ACI shall pay all expenses relating to the preparation, negotiation, execution and delivery of the Transaction Documents, including legal, agency and other fees;
(i) The Seller’s operating expenses will not be paid by ACI, the Transferor or any Originator or any Affiliate thereof;
(j) The Seller will have its own separate stationery;
(k) The Seller’s books and records will be maintained separately from those of ACI and any other Affiliate thereof and in a manner such that it will not be difficult or costly to segregate, ascertain or otherwise identify the assets and liabilities of Seller;
(l) All financial statements of ACI or any Affiliate thereof that are consolidated to include the Seller will disclose that (i) the Seller’s sole business consists of the purchase or acceptance through capital contributions of the Receivables and Related Rights from the Transferor and the subsequent retransfer of or granting of a security interest in such Receivables and Related Rights to certain purchasers party to this Agreement, (ii) the Seller is a separate legal entity with its own separate creditors who will be entitled, upon its liquidation, to be satisfied out of the Seller’s assets prior to any assets or value in the Seller becoming available to the Seller’s equity holders and (iii) the assets of the Seller are not available to pay creditors of ACI or any other Affiliates of ACI or the Originators or the Transferor;
(m) The Seller’s assets will be maintained in a manner that facilitates their identification and segregation from those of ACI or any Affiliates thereof;
IV-16
(n) The Seller will strictly observe corporate formalities in its dealings with ACI or any Affiliates thereof, and funds or other assets of the Seller will not be commingled with those of ACI or any Affiliates thereof except as permitted by this Agreement in connection with servicing the Pool Receivables. The Seller shall not maintain joint bank accounts or other depository accounts to which ACI or any Affiliate thereof (other than ACI in its capacity as the Servicer) has independent access. The Seller is not named, and has not entered into any agreement to be named, directly or indirectly, as a direct or contingent beneficiary or loss payee on any insurance policy with respect to any loss relating to the property of ACI or any Subsidiaries or other Affiliates thereof. The Seller will pay to the appropriate Affiliate the marginal increase or, in the absence of such increase, the market amount of its portion of the premium payable with respect to any insurance policy that covers the Seller and such Affiliate;
(o) The Seller will maintain arm’s-length relationships with ACI (and any Affiliates thereof). Any Person that renders or otherwise furnishes services to the Seller will be compensated by the Seller at market rates for such services it renders or otherwise furnishes to the Seller. Neither the Seller on the one hand, nor ACI, on the other hand, will be or will hold itself out to be responsible for the debts of the other or the decisions or actions respecting the daily business and affairs of the other. The Seller and ACI will immediately correct any known misrepresentation with respect to the foregoing, and they will not operate or purport to operate as an integrated single economic unit with respect to each other or in their dealing with any other entity;
(p) The Seller shall have a separate area from ACI for its business (which may be located at the same address as such entities) and to the extent that any other such entity have offices in the same location, there shall be a fair and appropriate allocation of overhead costs between them, and each shall bear its fair share of such expenses; and
(q) To the extent not already covered in paragraphs (a) through (o) above, Seller shall comply and/or act in accordance with the provisions of Section 6.4 of the Sale and Contribution Agreement.
4. Certain Post-Closing Requirements. As soon as practicable and in any event not later than 120 days following the Closing Date, the Servicer shall (or shall cause the Seller to) deliver to the Administrator favorable opinions, addressed to the Administrator, each Purchaser Agent and each Purchaser, in form and substance reasonably satisfactory to the Administrator, of external counsel for the Seller, Originators, the Servicer and ACI, covering certain corporate and UCC perfection matters relating to the Originators organized in Kentucky, West Virginia and Virginia as well as certain UCC perfection matters with respect to county-level filings made by each Originator.
IV-17
EXHIBIT V
TERMINATION EVENTS
Each of the following shall be a “Termination Event”:
(a) (i) the Seller, ACI, any Originator, the Transferor or the Servicer shall fail to perform or observe any term, covenant or agreement under the Agreement or any other Transaction Document, and, except as otherwise provided herein, such failure, solely to the extent capable of cure, shall continue for 30 days, (ii) the Seller or the Servicer shall fail to make when due any payment or deposit to be made by it under the Agreement or any other Transaction Document and such failure shall continue unremedied for one Business Day, or (iii) Arch Sales shall resign as Servicer, and no successor Servicer reasonably satisfactory to the Administrator shall have been appointed;
(b) Arch Sales (or any Affiliate thereof) shall fail to transfer to any successor Servicer when required any rights pursuant to the Agreement that Arch Sales (or such Affiliate) then has as Servicer;
(c) any representation or warranty made or deemed made by the Seller, ACI, any Originator, the Transferor or the Servicer (or any of their respective officers) under or in connection with the Agreement or any other Transaction Document, or any information or report delivered by the Seller, ACI, any Originator, the Transferor or the Servicer pursuant to the Agreement or any other Transaction Document, shall prove to have been incorrect or untrue when made or deemed made or delivered, and shall remain incorrect or untrue for 10 Business Days;
(d) the Seller or the Servicer shall fail to deliver any Information Package or Interim Report pursuant to the Agreement, and such failure shall remain unremedied for two Business Days;
(e) the Agreement or any purchase or reinvestment pursuant to the Agreement shall for any reason: (i) cease to create, or the Purchased Interest shall for any reason cease to be, a valid and enforceable perfected undivided percentage ownership or security interest to the extent of the Purchased Interest in each Pool Receivable, the Related Security and Collections with respect thereto, free and clear of any Adverse Claim, or (ii) cease to create with respect to the Pool Assets, or the interest of the Administrator with respect to such Pool Assets shall cease to be, a valid and enforceable first priority perfected security interest, free and clear of any Adverse Claim;
(f) the Seller, ACI, the Transferor or any Originator shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against the Seller, ACI the Transferor or any Originator seeking to adjudicate it as bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it), either such proceeding shall remain undismissed or unstayed for a period of 60 days, or any of the actions
V-1
sought in such proceeding (including the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or for any substantial part of the property) shall occur, or the Seller, ACI and the Transferor or any Originator shall take any corporate or organizational action to authorize any of the actions set forth above in this paragraph;
(g) (i) the (A) Default Ratio shall exceed 3% or (B) the Delinquency Ratio shall exceed 6%, or (ii) the average for three consecutive calendar months of: (A) the Default Ratio shall exceed 2%, (B) the Delinquency Ratio shall exceed 4% or (C) the Dilution Ratio shall exceed 3%, or (iii) Days’ Sales Outstanding shall exceed 48 days;
(h) a Change in Control shall occur;
(i) at any time (i) the sum of (A) the Aggregate Capital, plus the Adjusted LC Participation Amount, plus (B) the Total Reserves exceeds (ii) the sum of (A) the Net Receivables Pool Balance at such time, plus (B) the Purchasers’ Share of the amount of Collections then on deposit in the Lock-Box Accounts (other than amounts set aside therein representing Discount and fees), and such circumstance shall not have been cured within two Business Days;
(j) (i) ACI or any of its Subsidiaries shall fail to pay any principal of or premium or interest under (x) any Credit Agreement or (y) on any of its other Debt that is outstanding in a principal amount of at least $35,000,000 in the aggregate when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement, mortgage, indenture or instrument relating to such Debt (whether or not such failure shall have been waived under the related agreement), (ii) any other event shall occur or condition shall exist under any Credit Agreement or any agreement, mortgage, indenture or instrument relating to any such other Debt and shall continue after the applicable grace period, if any, specified in any Credit Agreement or such agreement, mortgage, indenture or instrument (whether or not such failure shall have been waived under the related agreement), if the effect of such event or condition is to give the applicable debtholders the right (whether acted upon or not) to accelerate the maturity of any Credit Agreement or such other Debt, or (iii) any Credit Agreement or any such other Debt shall be declared to be due and payable, or required to be prepaid (other than by a regularly scheduled required prepayment), redeemed, purchased or defeased, or an offer to repay, redeem, purchase or defease any Credit Agreement or such other Debt shall be required to be made, in each case before the stated maturity thereof;
(k) (i) ACI shall fail to perform any of its obligations under the Performance Guaranty or (ii) any Originator shall fail to perform any of its obligations under the Originator Performance Guaranty;
(l) (i) a contribution failure shall occur with respect to any Benefit Plan sufficient to give rise to a lien on any of the assets of Seller, any Originator, the Transferor, ACI or any ERISA Affiliate under Section 303(k) of ERISA and such failure is not cured and any related lien released within 10 days or (ii) either the Internal Revenue Service or the Pension Benefit Guaranty Corporation shall have filed one or more notices of lien asserting a claim or claims pursuant to the Internal Revenue Code, or ERISA, as applicable, against the assets of (a) the Seller or (b) the Servicer, the Transferor, any Originator, ACI or any ERISA Affiliate (other than the Seller) in an amount in excess of $250,000 and such lien is not released within 10 days;
V-2
(m) the Seller or ACI shall fail to (x) provide the Administrator and each Purchaser Agent with at least ten days’ prior written notice of any replacement or appointment of any director that is to serve as an Independent Director on the Seller’s board of directors or (y) obtain the prior written consent of the Administrator and each Purchaser Agent for any replacement or appointment of any director that is to serve as an Independent Director on the Seller’s board of directors and, in either case, such failure shall continue for ten days;
(n) any Letter of Credit is drawn upon and, unless as a result of the LC Bank’s failure to provide the notice required by Section 1.14(b), not fully reimbursed pursuant to Section 1.14 (including, if applicable, with the proceeds of any funding by any Purchaser) within two Business Days from the date of such draw;
(o) an order of the Bankruptcy Court shall be entered in any of the Chapter 11 Cases staying, reversing, vacating, amending, supplementing or otherwise modifying the Confirmation Order or any member of the Arch Group shall apply for authority to do so, in each case without the prior written consent of the Administrator and the Majority Purchaser Agents;
(p) a member of the Arch Group shall file a pleading seeking or consenting to the matters described in clause (o) above;
(q) the filing by any member of the Arch Group of any motion or proceeding that could reasonably be expected to result in material impairment of the Administrator’s or any Secured Party’s rights under the Transaction Documents; or a final determination by the Bankruptcy Court (or any court of competent jurisdiction) with respect to any motion or proceeding brought by any other party that results in any material impairment of the Administrator’s or any Secured Party’s rights under the Transaction Documents; or
(r) the existence of any Adverse Claim on any Pool Assets; or
(s) clause (b) of the Exception Account Conditions shall cease to be satisfied without the prior written consent of the Administrator (not to be unreasonably withheld, conditioned or delayed) unless, promptly after the Servicer obtains knowledge thereof, the Servicer shall have delivered a revised Information Package identifying each Receivable the Obligor of which has been instructed to make payments to an Exception Account or made its most recent remittance of Collections to an Exception Account with information sufficient to re-determine the Purchased Interest without such Receivables included as Eligible Receivables.
V-3
SCHEDULE I
CREDIT AND COLLECTION POLICY
[Attached]
Schedule I-1
SCHEDULE II
LOCK-BOX BANK, BLOCKED ACCOUNT AND LOCK-BOX ACCOUNT
| Lock-Box Bank |
Blocked Account |
Lock-Box Account | ||
| PNC Bank, National Association | 1019291244 | 642545 | ||
| PNC Bank, National Association | 1077763916 |
Schedule II-1
SCHEDULE III
ACTIONS AND PROCEEDINGS
[NONE]
Schedule III
SCHEDULE IV
GROUP COMMITMENTS
| Purchaser Group |
||||||||||
| Name |
Capacity | Commitment | Group Commitment |
|||||||
| PNC Purchaser Group |
Purchaser Group |
N/A | $ | 102,500,000 | ||||||
| PNC |
Related Committed Purchaser |
$ | 102,500,000 | |||||||
| PNC |
LC Participant | $ | 102,500,000 | |||||||
| PNC |
Purchaser Agent |
N/A | ||||||||
| PNC |
LC Bank | N/A | ||||||||
| Regions Purchaser Group |
Purchaser Group |
N/A | $ | 47,500,000 | ||||||
| Regions |
Related Committed Purchaser |
$ | 47,500,000 | |||||||
| Regions |
LC Participant | $ | 47,500,000 | |||||||
| Regions |
Purchaser Agent |
N/A | ||||||||
Schedule III
ANNEX A
to Receivables Purchase Agreement
FORM OF INFORMATION PACKAGE
[Attached]
Annex A-1
ANNEX B-1
to Receivables Purchase Agreement
FORM OF PURCHASE NOTICE
, [201 ]
PNC Bank, National Association
300 Fifth Avenue
11th Floor
Pittsburgh, PA 15222
[Each other Purchaser Agent]
Ladies and Gentlemen:
Reference is hereby made to the Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 (as heretofore amended, restated, supplemented or otherwise modified, the “Receivables Purchase Agreement”), among Arch Receivable Company, LLC, (“Seller”), Arch Coal Sales Company, Inc., as Servicer, the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto and PNC Bank, National Association (“PNC”, as administrator (in such capacity, the “Administrator”) and as the issuer of letters of credit thereunder (in such capacity, the “LC Bank”). Capitalized terms used in this Purchase Notice and not otherwise defined herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.
This letter constitutes a Purchase Notice pursuant to Section 1.2(a) of the Receivables Purchase Agreement. Seller desires to sell an undivided percentage interest in a pool of receivables on , [201 ], for a purchase price of $ 1 (of which $ will be funded by PNC and $ will be funded by Regions). Subsequent to this Purchase, the Aggregate Capital will be $ .
Seller hereby represents and warrants as of the date hereof, and as of the date of such purchase, as follows:
(i) the representations and warranties contained in Exhibit III of the Receivables Purchase Agreement are correct in all material respects on and as of such dates as though made on and as of such dates and shall be deemed to have been made on such dates (except for representations and warranties that apply solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date);
| 1 | Such amount, which shall not be less than $300,000 (or such lesser amount as agreed to by the Administrator and each Purchaser Agent) and shall be in integral multiples of $100,000 in excess thereof. |
Annex B-2-1
(ii) no Termination Event or Unmatured Termination Event has occurred and is continuing, or would result from such purchase;
(iii) after giving effect to the purchase proposed hereby, the sum of the Aggregate Capital plus the LC Participation Amount shall not exceed the Purchase Limit, and the Purchased Interest shall not exceed 100%; and
(iv) the Facility Termination Date shall not have occurred.
Annex B-2-2
IN WITNESS WHEREOF, the undersigned has caused this Purchase Notice to be executed by its duly authorized officer as of the date first above written.
| ARCH RECEIVABLE COMPANY, LLC | ||
| By: | ||
| Name: |
||
| Title: |
||
Annex B-2-3
ANNEX B-2
to Receivables Purchase Agreement
FORM OF ISSUANCE NOTICE
, [201 ]
PNC Bank, National Association
300 Fifth Avenue
11th Floor
Pittsburgh, PA 15222
[Each other Purchaser Agent]
Ladies and Gentlemen:
Reference is hereby made to the Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 (as heretofore amended, restated, supplemented or otherwise modified, the “Receivables Purchase Agreement”), among Arch Receivable Company, LLC, (“Seller”), Arch Coal Sales Company, Inc., as Servicer, the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto and PNC Bank, National Association (“PNC”, as administrator (in such capacity, the “Administrator”) and as the issuer of letters of credit thereunder (in such capacity, the “LC Bank”). Capitalized terms used in this Issuance Notice and not otherwise defined herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.
This letter constitutes a notice pursuant to Section 1.12(a) of the Receivables Purchase Agreement. Seller desires that LC Bank issue a Letter of Credit with a face amount of $ . Subsequent to this issuance, the LC Participation Amount will be $ [and the Aggregate Capital will be $ ].
Seller hereby represents and warrants as of the date hereof, and as of the date of such issuance, as follows:
(i) the representations and warranties contained in Exhibit III of the Receivables Purchase Agreement are correct in all material respects on and as of such dates as though made on and as of such dates and shall be deemed to have been made on such dates (except for representations and warranties that apply solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date);
(ii) no Termination Event or Unmatured Termination Event has occurred and is continuing, or would result from such issuance;
Annex B-2-1
(iii) after giving effect to the issuance proposed hereby, the sum of the Aggregate Capital plus the LC Participation Amount shall not exceed the Purchase Limit, and the Purchased Interest shall not exceed 100%; and
(iv) the Facility Termination Date shall not have occurred.
Annex B-2-2
IN WITNESS WHEREOF, the undersigned has caused this Issuance Notice to be executed by its duly authorized officer as of the date first above written.
| ARCH RECEIVABLE COMPANY, LLC | ||
| By: |
||
| Name: |
||
| Title: |
||
Annex B-2-3
ANNEX C
to Receivables Purchase Agreement
FORM OF PAYDOWN NOTICE
, 200
PNC Bank, National Association
300 Fifth Avenue
11th Floor
Pittsburgh, PA 15222
[Each other Purchaser Agent]
Ladies and Gentlemen:
Reference is hereby made to the Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 (as amended, restated, supplemented or otherwise modified from time to time, the “Receivables Purchase Agreement”), among Arch Receivable Company, LLC, as Seller, Arch Coal Sales Company, Inc., as Servicer, the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto and PNC Bank, National Association (“PNC”), as Administrator and as the LC Bank. Capitalized terms used in this paydown notice and not otherwise defined herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.
This letter constitutes a Paydown Notice pursuant to Section 1.4(f)(i) of the Receivables Purchase Agreement. The Seller desires to reduce the Aggregate Capital on , 1 by the application of $ (of which $ will reduce Capital funded by the PNC Purchaser Group and $ will reduce Capital funded by the Regions Purchaser Group) in cash to pay Aggregate Capital and Aggregate Discount to accrue (until such cash can be used to pay commercial paper notes) with respect to such Aggregate Capital, together with all costs related to such reduction of Aggregate Capital. Subsequent to this paydown, the Aggregate Capital will be $ .
| 1 | Notice must be given at least five (5) Business Days’ prior to the requested paydown date, in the case of reductions in excess of $20,000,000, or at least two (2) Business Days’ prior to the requested paydown date, in the case of reductions of $20,000,000 or less. |
Annex C-1
IN WITNESS WHEREOF, the undersigned has caused this paydown notice to be executed by its duly authorized officer as of the date first above written.
| ARCH RECEIVABLE COMPANY, LLC | ||
| By: | ||
| Name: |
||
| Title: |
||
Annex C-2
ANNEX D
to Receivables Purchase Agreement
FORM OF COMPLIANCE CERTIFICATE
To: PNC Bank, National Association, as Administrator
[Each Purchaser Agent]
This Compliance Certificate is furnished pursuant to that certain Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 by and among Arch Receivable Company, LLC (“Seller”), Arch Coal Sales Company, Inc. (the “Servicer”), the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto and PNC Bank, National Association (the “Administrator”) and as the LC Bank (as amended, restated, supplemented or otherwise modified from time to time, the “Agreement”). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Agreement.
THE UNDERSIGNED, SOLELY IN [HIS] [HER] CAPACITY AS OF SELLER, HEREBY CERTIFIES ON BEHALF OF SELLER THAT:
1. I am the duly elected of Seller.
2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under my supervision, a detailed review of the transactions and condition of Seller during the accounting period covered by the attached financial statements.
3. The examinations described in paragraph 2 did not disclose, and I have no knowledge of, the existence of any condition or event which constitutes a Termination Event or an Unmatured Termination Event, as each such term is defined under the Agreement, during or at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate, except as set forth in paragraph 5 below.
4. Described below are the exceptions, if any, to paragraph 3 by listing, in detail, the nature of the condition or event, the period during which it has existed and the action which Seller has taken, is taking, or proposes to take with respect to each such condition or event:
Annex D-1
The foregoing certifications, together with the computations set forth in Schedule I hereto and the financial statements delivered with this Certificate in support hereof, are made and delivered this day of , 20 .
| ARCH RECEIVABLE COMPANY, LLC | ||
| By: |
||
| Name: |
||
| Title: |
||
Annex D-2
ANNEX E
to Receivables Purchase Agreement
FORM OF LETTER OF CREDIT APPLICATION
[Attached]
Annex E-1
ANNEX F
to Receivables Purchase Agreement
FORM OF ASSUMPTION AGREEMENT
Dated as of [ , 20__]
THIS ASSUMPTION AGREEMENT (this “AGREEMENT”), dated as of [ , ], is among ARCH RECEIVABLE COMPANY, LLC (the “Seller”), [ ], as purchaser (the “[ ] Conduit Purchaser”), [ ], as the related committed purchaser (the “[ ] Related Committed Purchaser”), [ ], as related lc participant (the “[ ] LC Participant” and together with the Conduit Purchaser and the Related Committed Purchaser, the “[ ] Purchasers”), and [ ], as agent for the [ ] Purchasers (the “[ ] Purchaser Agent” and together with the [ ] Purchasers, the “[ ] Purchaser Group”).
BACKGROUND
The Seller and various others are parties to that certain Third Amended and Restated Receivables Purchase Agreement dated as of October 5, 2016 (as amended, restated, supplemented or otherwise modified through the date hereof, the “Receivables Purchase Agreement”). Capitalized terms used and not otherwise defined herein have the respective meaning assigned to such terms in the Receivables Purchase Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. This letter constitutes an Assumption Agreement pursuant to Section 1.2(f) of the Receivables Purchase Agreement. The Seller desires [the [ ] Purchasers] [the [ ] Related Committed Purchaser] [the [ ] related LC Participant] to [become Purchasers under] [increase its existing Commitment under] the Receivables Purchase Agreement and upon the terms and subject to the conditions set forth in the Receivables Purchase Agreement, the [ ] Purchasers agree to [become Purchasers thereunder] [increase its Commitment in an amount equal to the amount set forth as the “Commitment” under the signature of such [ ] Related Committed Purchaser hereto] [increase its Commitment in an amount equal to the amount set forth as the “Commitment” under the signature of such [ ] related LC Participant hereto].
Seller hereby represents and warrants to the [ ] Purchasers as of the date hereof, as follows:
(i) the representations and warranties of the Seller contained in Exhibit III of the Receivables Purchase Agreement are true and correct in all material respects on and as the date of such purchase or reinvestment as though made on and as of such date (except for representations and warranties which apply as to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date);
Annex F-1
(ii) no event has occurred and is continuing, or would result from such purchase or reinvestment, that constitutes a Termination Event or an Unmatured Termination Event; and
(iii) the Facility Termination Date has not occurred.
SECTION 2. Upon execution and delivery of this Agreement by the Seller and each member of the [ ] Purchaser Group, satisfaction of the other conditions to assignment specified in Section 1.2(e) of the Receivables Purchase Agreement (including the written consent of the Administrator and each Purchaser Agent) and receipt by the Administrator and Seller of counterparts of this Agreement (whether by facsimile or otherwise) executed by each of the parties hereto, [the [ ] Purchasers shall become a party to, and have the rights and obligations of Purchasers under, the Receivables Purchase Agreement][the [ ] Related Committed Purchaser shall increase its Commitment in the amount set forth as the “Commitment” under the signature of the [ ] Related Committed Purchaser hereto][the [ ] related LC Participant shall increase its Commitment in the amount set forth as the “Commitment” under the signature of the [ ] related LC Participant hereto].
SECTION 3. Each party hereto hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, any Conduit Purchaser, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and one day after the latest maturing Note issued by such Conduit Purchaser is paid in full. The covenant contained in this paragraph shall survive any termination of the Receivables Purchase Agreement.
SECTION 4. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. This Agreement may not be amended, supplemented or waived except pursuant to a writing signed by the party to be charged. This Agreement may be executed in counterparts, and by the different parties on different counterparts, each of which shall constitute an original, but all together shall constitute one and the same agreement.
(continued on following page)
Annex F-2
IN WITNESS WHEREOF, the parties hereto have executed this Agreement by their duly authorized officers as of the date first above written.
| [ ], as a Conduit Purchaser | ||
| By: | ||
| Name Printed: | ||
| Title: | ||
| [Address] | ||
| [ ], as a Related Committed Purchaser | ||
| By: | ||
| Name Printed: | ||
| Title: | ||
| [Address] | ||
| [Commitment] | ||
| [ ], as a related LC Participant | ||
| By: | ||
| Name Printed: | ||
| Title: | ||
| [Address] | ||
| [Commitment] | ||
| [ ], as Purchaser Agent for [ ] | ||
| By: | ||
| Name Printed: | ||
| Title: | ||
| [Address] | ||
Annex F-3
| ARCH RECEIVABLE COMPANY, LLC, as Seller | ||
| By: | ||
| Name Printed: |
|
| Title: |
| |
| Consented and Agreed: | ||
| PNC BANK, NATIONAL ASSOCIATION, as Administrator | ||
| By: | ||
| Name Printed: |
|
| Title: |
| |
| Address: | PNC Bank, National Association | |
| 300 Fifth Avenue | ||
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
| PNC BANK, NATIONAL ASSOCIATION, as LC Bank | ||
| By: | ||
| Name Printed: |
|
| Title: |
| |
| Address: | PNC Bank, National Association | |
| 300 Fifth Avenue | ||
| 11th Floor | ||
| Pittsburgh, Pennsylvania 15222 | ||
Annex F-4
| [THE PURCHASER AGENTS] | ||
| By: | ||
| Name Printed: | ||
| Title: | ||
| [Address] | ||
Annex F-5
ANNEX G
to Receivables Purchase Agreement
FORM OF TRANSFER SUPPLEMENT
Dated as of [ , 20__]
Section 1.
Commitment assigned: $
Assignor’s remaining Commitment: $
Capital allocable to Commitment assigned: $
Assignor’s remaining Capital: $
Discount (if any) allocable to
Capital assigned: $
Discount(if any) allocable to Assignor’s
remaining Capital: $
Section 2.
Effective Date of this Transfer Supplement: [ ]
Upon execution and delivery of this Transfer Supplement by transferee and transferor and the satisfaction of the other conditions to assignment specified in Section 5.3(c) of the Receivables Purchase Agreement (as defined below), from and after the effective date specified above, the transferee shall become a party to, and have the rights and obligations of a Related Committed Purchaser under, the Third Amended and Restated Receivables Purchase Agreement, dated as of October 5, 2016 (as amended, restated, supplemented or otherwise modified through the date hereof, the “Receivables Purchase Agreement”), among Arch Receivable Company, LLC, as Seller, Arch Coal Sales Company, Inc., as initial Servicer, the various Conduit Purchasers, Related Committed Purchasers, Purchaser Agents and LC Participants from time to time parties thereto and PNC Bank, National Association, as Administrator and as LC Bank.
Annex G-1
| ASSIGNOR: [_________], as a Related Committed Purchaser | ||
| By: | ||
| Name: | ||
| Title: | ||
| ASSIGNEE: [_________], as a Purchasing Related Committed Purchaser | ||
| By: | ||
| Name: | ||
| Title: | ||
| [Address] | ||
| Accepted as of date first above written: | ||
| [ ], as Purchaser Agent for the [ ] Purchaser Group | ||
| By: | ||
| Name: | ||
| Title: | ||
Annex G-2
ANNEX H-1
to Receivables Purchase Agreement
FORM OF WEEKLY REPORT
[Attached]
Annex H-1-1
ANNEX H-2
to Receivables Purchase Agreement
FORM OF DAILY REPORT
[Attached]
Annex H-2-1
ANNEX I
to Receivables Purchase Agreement
[Reserved]
Annex I-1
ANNEX J
to Receivables Purchase Agreement
FORM OF CASH FLOW FORECAST
[Attached]
Annex J-1
Exhibit 10.3
INDEMNIFICATION AND ADVANCEMENT AGREEMENT
This Indemnification and Advancement Agreement (“Agreement”) is made as of ________ __, 20__ by and between Core Natural Resources, Inc., a Delaware corporation (the “Company”), and ______________, [a member of the Board of Directors/an officer] of the Company (“Indemnitee”). This Agreement supersedes and replaces any and all previous Agreements between the Company and Indemnitee covering indemnification and advancement of expenses.
RECITALS
WHEREAS, the Board of Directors of the Company (the “Board”) believes that highly competent persons have become more reluctant to serve publicly-held corporations as directors or officers unless they are provided with adequate protection through insurance or adequate indemnification and advancement of expenses against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;
WHEREAS, the Board has determined that, in order to attract and retain qualified individuals, the Company should maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions. At the same time, directors and officers are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the Company or business enterprise itself. The Company’s Bylaws require indemnification of the officers and directors of the Company and the Company’s Certificate of Incorporation provides for limitation of liability for directors and officers. Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (the “DGCL”). The Bylaws and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Company and members of the board of directors and officers with respect to indemnification and advancement of expenses;
WHEREAS, the uncertainties relating to such insurance, to indemnification, and to advancement of expenses may increase the difficulty of attracting and retaining such persons;
WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified;
WHEREAS, this Agreement is a supplement to and in furtherance of the Bylaws, Certificate of Incorporation and any resolutions adopted pursuant thereto, as well as any rights of Indemnitee under any directors’ and officers’ liability insurance policy, and is not a substitute therefor, and does not diminish or abrogate any rights of Indemnitee thereunder; and
WHEREAS, Indemnitee does not regard the protection available under the Bylaws and insurance as adequate in the present circumstances, and may not be willing to serve or continue to serve as an officer or director without adequate additional protection, and the Company desires Indemnitee to serve or continue to serve in such capacity. Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that Indemnitee be so indemnified and advanced expenses.
NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:
Section 1. Services to the Company. Indemnitee agrees to serve[, or to continue to serve] as [a/an] [director/officer] of the Company. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law). This Agreement does not create any obligation on the Company to continue Indemnitee in such position and is not an employment contract between the Company (or any of its subsidiaries or any Enterprise) and Indemnitee.
Section 2. Definitions. As used in this Agreement:
(a) “Agent” means any person who is authorized by the Company or an Enterprise to act for or represent the interests of the Company or an Enterprise, respectively.
(b) A “Change in Control” occurs upon the earliest to occur after the date of this Agreement of any of the following events:
i. Acquisition of Stock by Third Party. Any Person (as defined below) is or becomes the Beneficial Owner (as defined below), directly or indirectly, of securities of the Company representing fifteen percent (15%) or more of the combined voting power of the Company’s then outstanding securities unless the change in relative beneficial ownership of the Company’s securities by any Person results solely from a reduction in the aggregate number of outstanding shares of securities entitled to vote generally in the election of directors;
ii. Change in Board of Directors. During any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in Sections 2(b)(i), 2(b)(iii) or 2(b)(iv)) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Board;
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iii. Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;
iv. Liquidation. The approval by the stockholders of the Company of a complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets; and
v. Other Events. There occurs any other event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or a response to any similar item on any similar schedule or form) promulgated under the Exchange Act (as defined below), whether or not the Company is then subject to such reporting requirement.
vi. For purposes of this Section 2(b), the following terms have the following meanings:
| 1 | “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. |
| 2 | “Person” has the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person excludes (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any entity owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company. |
| 3 | “Beneficial Owner” has the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner excludes any Person otherwise becoming a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company with another entity. |
(c) “Corporate Status” describes the status of a person who is or was acting as a director, officer, employee, fiduciary, or Agent of the Company or an Enterprise.
(d) “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.
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(e) “Enterprise” means any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other entity for which Indemnitee is or was serving at the request of the Company as a director, officer, employee, fiduciary, or Agent.
(f) “Expenses” includes all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees and other costs of experts and other professionals, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, ERISA excise taxes and penalties, and all other disbursements, obligations, or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also include (i) Expenses incurred in connection with any appeal resulting from any Proceeding, including, without limitation, the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent, and (ii) for purposes of Section 14(d) only, Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise. Expenses, however, do not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.
(g) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” does not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. The Company agrees to pay the reasonable fees and expenses of the Independent Counsel.
(h) The term “Proceeding” includes any threatened, pending or completed action, suit, claim, counterclaim, cross claim, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought in the right of the Company or otherwise and whether of a civil, criminal, administrative, legislative, regulatory, or investigative (formal or informal) nature, including any appeal therefrom, in which Indemnitee was, is or will be involved as a party, potential party, non-party witness or otherwise by reason of Indemnitee’s Corporate Status or by reason of any action taken by Indemnitee (or a failure to take action by Indemnitee) or of any action (or failure to act) on Indemnitee’s part while acting pursuant to Indemnitee’s Corporate Status, in each case whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification, reimbursement, or advancement of Expenses can be provided under this Agreement. A Proceeding also includes a situation the Indemnitee believes in good faith may lead to or culminate in the institution of a Proceeding.
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Section 3. Indemnity in Third-Party Proceedings. The Company will indemnify Indemnitee in accordance with the provisions of this Section 3 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding, other than a Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 3, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses, judgments, fines and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses, judgments, fines and amounts paid in settlement) actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and, in the case of a criminal Proceeding had no reasonable cause to believe that Indemnitee’s conduct was unlawful.
Section 4. Indemnity in Proceedings by or in the Right of the Company. The Company will indemnify Indemnitee in accordance with the provisions of this Section 4 if Indemnitee is, or is threatened to be made, a party to or a participant in any Proceeding by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 4, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company. The Company will not indemnify Indemnitee for Expenses under this Section 4 related to any claim, issue or matter in a Proceeding for which Indemnitee has been finally adjudged by a court to be liable to the Company, unless, and only to the extent that, the Court of Chancery of the state of Delaware (the “Delaware Court”) or any court in which the Proceeding was brought determines upon application by Indemnitee that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification.
Section 5. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. To the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding to the extent that Indemnitee is successful, on the merits or otherwise. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with or related to each successfully resolved claim, issue or matter to the fullest extent permitted by law. For purposes of this Section 5 and, without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, will be deemed to be a successful result as to such claim, issue or matter.
Section 6. Indemnification for Expenses of a Witness. To the fullest extent permitted by applicable law, the Company will indemnify Indemnitee against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding to which Indemnitee is not a party but to which Indemnitee is a witness, deponent, interviewee, or otherwise asked to participate or provide information.
Section 7. Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company will indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
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Section 8. Additional Indemnification. Notwithstanding any limitation in Sections 3, 4, or 5, the Company will indemnify Indemnitee to the fullest extent permitted by applicable law (including, but not limited to, the DGCL and any amendments to or replacements of the DGCL adopted after the date of this Agreement that expand the Company’s ability to indemnify its officers and directors) if Indemnitee is a party to or threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Company to procure a judgment in its favor).
Section 9. Exclusions. Notwithstanding any provision in this Agreement, the Company is not obligated under this Agreement to make any indemnification payment to Indemnitee in connection with any Proceeding:
(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except to the extent provided in Section 16(b) and except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision; or
(b) for (i) an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act (as defined in Section 2(b) hereof) or similar provisions of state statutory law or common law, (ii) any reimbursement of the Company by the Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act), or (iii) any reimbursement of the Company by Indemnitee of any compensation pursuant to any compensation recoupment or clawback policy adopted by the Board or the compensation committee of the Board, including, but not limited to, any such policy adopted to comply with stock exchange listing requirements implementing Section 10D of the Exchange Act; or
(c) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to indemnification or advancement, of Expenses, including a Proceeding (or any part of any Proceeding) initiated pursuant to Section 14 of this Agreement, (ii) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation or (iii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law.
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Section 10. Advances of Expenses.
(a) The Company will advance, to the extent not prohibited by law, the Expenses incurred by Indemnitee in connection with any Proceeding (or any part of any Proceeding) not initiated by Indemnitee or any Proceeding (or any part of any Proceeding) initiated by Indemnitee if (i) the Proceeding or part of any Proceeding is to enforce Indemnitee’s rights to obtain indemnification or advancement of Expenses from the Company or Enterprise, including a proceeding initiated pursuant to Section 14 or (ii) the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation. The Company will advance the Expenses within ten (10) days after the receipt by the Company of a statement or statements requesting such advances from time to time, whether prior to or after final disposition of any Proceeding.
(b) Advances will be unsecured and interest free. Indemnitee hereby undertakes to repay any amounts so advanced (without interest) to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company, thus Indemnitee qualifies for advances upon the execution of this Agreement and delivery to the Company. No other form of undertaking is required other than the execution of this Agreement. The Company will make advances without regard to Indemnitee’s ability to repay the Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement.
Section 11. Procedure for Notification of Claim for Indemnification or Advancement.
(a) Indemnitee will notify the Company in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification or advancement of Expenses hereunder as soon as reasonably practicable following the receipt by Indemnitee of written notice thereof. Indemnitee will include in the written notification to the Company a description of the nature of the Proceeding and the facts underlying the Proceeding and provide such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of such Proceeding. Indemnitee’s failure to notify the Company will not relieve the Company from any obligation it may have to Indemnitee under this Agreement, and any delay in so notifying the Company will not constitute a waiver by Indemnitee of any rights under this Agreement. The Secretary of the Company will, promptly upon receipt of such a request for indemnification or advancement, advise the Board in writing that Indemnitee has requested indemnification or advancement.
(b) The Company will be entitled to participate in the Proceeding at its own expense.
Section 12. Procedure Upon Application for Indemnification.
(a) Unless a Change of Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made:
i. by a majority vote of the Disinterested Directors, even though less than a quorum of the Board;
ii. by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum of the Board; or
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iii. if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by written opinion provided by Independent Counsel selected by the Board;
(b) If a Change in Control has occurred, the determination of Indemnitee’s entitlement to indemnification will be made by written opinion provided by Independent Counsel selected by Indemnitee (unless Indemnitee requests such selection be made by the Board).
(c) The party selecting Independent Counsel pursuant to subsection (a)(iii) or (b) of this Section 12 will provide written notice of the selection to the other party. The notified party may, within ten (10) days after receiving written notice of the selection of Independent Counsel, deliver to the selecting party a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 2 of this Agreement, and the objection will set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the person so selected will act as Independent Counsel. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or the Delaware Court has determined that such objection is without merit. If, within thirty (30) days after the later of submission by Indemnitee of a written request for indemnification pursuant to Section 11(a) hereof and the final disposition of the Proceeding, Independent Counsel has not been selected or, if selected, any objection to has not been resolved, either the Company or Indemnitee may petition the Delaware Court for resolution of any objection made by the Company or Indemnitee to the other’s selection or Independent Counsel and/or for the appointment as Independent Counsel of a person selected by such court or by such other person as such court designates. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 14(a) of this Agreement, Independent Counsel will be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).
(d) Indemnitee will cooperate with the person, persons or entity making the determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. The Company will advance and pay any Expenses incurred by Indemnitee in so cooperating with the person, persons or entity making the indemnification determination irrespective of the determination as to Indemnitee’s entitlement to indemnification and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Company promptly will advise Indemnitee in writing of the determination that Indemnitee is or is not entitled to indemnification, including a description of any reason or basis for which indemnification has been denied and providing a copy of any written opinion provided to the Board by Independent Counsel.
(e) If it is determined that Indemnitee is entitled to indemnification, the Company will make payment to Indemnitee within ten (10) days after such determination.
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Section 13. Presumptions and Effect of Certain Proceedings.
(a) In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination will, to the fullest extent not prohibited by law, presume Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 11(a) of this Agreement, and the Company will, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption. Neither the failure of the Company (including by its directors or Independent Counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or Independent Counsel) that Indemnitee has not met such applicable standard of conduct, will be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.
(b) If the determination of the Indemnitee’s entitlement to indemnification has not been made pursuant to Section 12 within sixty (60) days after the later of (i) receipt by the Company of Indemnitee’s request for indemnification pursuant to Section 11(a) and (ii) the final disposition of the Proceeding for which Indemnitee requested Indemnification (the “Determination Period”), the requisite determination of entitlement to indemnification will, to the fullest extent not prohibited by law, be deemed to have been made and Indemnitee will be entitled to such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law. The Determination Period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto; and provided, further, the Determination Period will not apply if the determination of entitlement to indemnification is to be made by Independent Counsel.
(c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, will not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.
(d) For purposes of any determination of good faith, Indemnitee will be deemed to have acted in good faith if Indemnitee acted based on the records or books of account of the Company, its subsidiaries, or an Enterprise, including financial statements, or on information supplied to Indemnitee by the directors or officers of the Company, its subsidiaries, or an Enterprise in the course of their duties, or on the advice of legal counsel for the Company, its subsidiaries, or an Enterprise or on information or records given or reports made to the Company or an Enterprise by an independent certified public accountant or by an appraiser, financial advisor or other expert selected with reasonable care by or on behalf of the Company, its subsidiaries, or an Enterprise. Further, Indemnitee will be deemed to have acted in a manner “not opposed to the best interests of the Company,” as referred to in this Agreement if Indemnitee acted in good faith
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and in a manner Indemnitee reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan. The provisions of this Section 13(d) is not exclusive and do not limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.
(e) The knowledge and/or actions, or failure to act, of any director, officer, trustee, partner, managing member, fiduciary, agent or employee of the Enterprise may not be imputed to Indemnitee for purposes of determining Indemnitee’s right to indemnification under this Agreement.
Section 14. Remedies of Indemnitee.
(a) Indemnitee may commence litigation against the Company in the Delaware Court to obtain indemnification or advancement of Expenses provided by this Agreement in the event that (i) a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) the Company does not advance Expenses pursuant to Section 10 of this Agreement, (iii) the determination of entitlement to indemnification is not made pursuant to Section 12 of this Agreement within the Determination Period, (iv) the Company does not indemnify Indemnitee pursuant to Section 5 or 6 or the second to last sentence of Section 12(d) of this Agreement within thirty (30) days after receipt by the Company of a written request therefor, (v) the Company does not indemnify Indemnitee pursuant to Section 3, 4, 7, or 8 of this Agreement within thirty (30) days after a determination has been made that Indemnitee is entitled to indemnification, or (vi) in the event that the Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or Proceeding designed to deny, or to recover from, the Indemnitee the benefits provided or intended to be provided to the Indemnitee hereunder. Alternatively, the Indemnitee or Company, at either the Indemnitee’s or Company’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The Company will not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.
(b) If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 14 will be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee may not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 14 the Company will have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be, and will not introduce evidence of the determination made pursuant to Section 12 of this Agreement.
(c) If a determination is made pursuant to Section 12 of this Agreement that Indemnitee is entitled to indemnification, the Company will be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 14, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.
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(d) The Company is, to the fullest extent not prohibited by law, precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 14 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and will stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement.
(e) It is the intent of the Company that, to the fullest extent permitted by law, the Indemnitee not be required to incur legal fees or other Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Indemnitee hereunder. The Company, to the fullest extent permitted by law, will (within ten (10) days after receipt by the Company of a written request therefor) advance to Indemnitee such Expenses which are incurred by Indemnitee in connection with any action concerning this Agreement, Indemnitee’s right to indemnification or advancement of Expenses from the Company, or concerning any directors’ and officers’ liability insurance policies maintained by the Company, and will indemnify Indemnitee against any and all such Expenses unless the court determines that Indemnitee’s claims in such action were made in bad faith or were frivolous or are prohibited by law.
Section 15. Non-exclusivity; Survival of Rights; Insurance; Subrogation.
(a) The indemnification and advancement of Expenses provided by this Agreement are not exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. The indemnification and advancement of Expenses provided by this Agreement may not be limited or restricted by any amendment, alteration or repeal of this Agreement in any way with respect to any action taken or omitted by Indemnitee in Indemnitee’s Corporate Status occurring prior to any amendment, alteration or repeal of this Agreement. To the extent that a change in Delaware law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Bylaws, Certificate of Incorporation, or this Agreement, it is the intent of the parties hereto that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy is cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, will not prevent the concurrent assertion or employment of any other right or remedy.
(b) To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees, or agents of the Company, the Company will obtain a policy or policies covering Indemnitee to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies, including coverage in the event the Company does not or cannot, for any reason, indemnify or advance Expenses to Indemnitee as required by this Agreement. If, at the time of the receipt of a notice of a claim pursuant to this Agreement, the Company has director and officer liability insurance in effect, the Company will give prompt notice of such claim or of the commencement of a Proceeding, as the case may be, to the insurers in accordance with the procedures set forth in
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the respective policies. The Company will thereafter take all reasonable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies. Indemnitee agrees to assist the Company efforts to cause the insurers to pay such amounts and will comply with the terms of such policies, including selection of approved panel counsel, if required.
(c) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee for any Proceeding concerning Indemnitee’s Corporate Status with an Enterprise will be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such Enterprise. The Company and Indemnitee intend that any such Enterprise (and its insurers) be the indemnitor of first resort with respect to indemnification and advancement of Expenses for any Proceeding related to or arising from Indemnitee’s Corporate Status with such Enterprise. The Company’s obligation to indemnify and advance Expenses to Indemnitee is secondary to the obligations the Enterprise or its insurers owe to Indemnitee. Indemnitee agrees to take all reasonably necessary and desirable action to obtain from an Enterprise indemnification and advancement of Expenses for any Proceeding related to or arising from Indemnitee’s Corporate Status with such Enterprise.
(d) In the event of any payment made by the Company under this Agreement, the Company will be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee from any Enterprise or its insurance carrier. Indemnitee will execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
Section 16. Duration of Agreement. This Agreement continues until and terminates upon the later of: (a) ten (10) years after the date that Indemnitee ceases to have a Corporate Status, (b) one (1) year after the final termination of any Proceeding then pending in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any Proceeding commenced by Indemnitee pursuant to Section 14 of this Agreement relating thereto, or (c) the date following the expiry of any applicable statute of limitations period. The indemnification and advancement of Expenses rights provided by or granted pursuant to this Agreement are binding upon and enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or of any other Enterprise, and inure to the benefit of Indemnitee and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.
Section 17. Severability. If any provision or provisions of this Agreement is held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will not in any way be affected or impaired thereby and remain enforceable to the fullest extent permitted by law; (b) such provision or provisions will be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) will be construed so as to give effect to the intent manifested thereby.
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Section 18. Interpretation. Any ambiguity in the terms of this Agreement will be resolved in favor of Indemnitee and in a manner to provide the maximum indemnification and advancement of Expenses permitted by law. The Company and Indemnitee intend that this Agreement provide to the fullest extent permitted by law for indemnification and advancement in excess of that expressly provided, without limitation, by the Certificate of Incorporation, the Bylaws, or Disinterested Directors, or applicable law.
Section 19. Enforcement.
(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve, or continue to serve, as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving or continuing to serve as a director or officer of the Company.
(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws, any directors’ and officers’ insurance maintained by the Company and applicable law, and is not a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder.
Section 20. Modification and Waiver. No supplement, modification or amendment of this Agreement is binding unless executed in writing by the parties hereto. No waiver of any of the provisions of this Agreement will be deemed or constitutes a waiver of any other provisions of this Agreement nor will any waiver constitute a continuing waiver.
Section 21. Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder. The failure of Indemnitee to so notify the Company does not relieve the Company of any obligation which it may have to the Indemnitee under this Agreement or otherwise.
Section 22. Notices. All notices, requests, demands and other communications under this Agreement will be in writing and will be deemed to have been duly given if (a) delivered by hand to the other party, (b) sent by reputable overnight courier to the other party or (c) sent by facsimile transmission or electronic mail, with receipt of oral confirmation that such communication has been received:
(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee provides to the Company.
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(b) If to the Company to:
| Core Natural Resources, Inc. | ||
| Address: | 275 Technology Drive, Suite 101 | |
| Canonsburg, Pennsylvania 15317 | ||
| Attention: | Office of the Chief Legal Officer | |
| Fax: | [ ⚫ ] | |
| Email: | [ ⚫ ] | |
or to any other address as may have been furnished to Indemnitee by the Company.
Section 23. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, will contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).
Section 24. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties are governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. Except with respect to any arbitration commenced pursuant to Section 14(a) of this Agreement, the Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action, claim, or proceeding between the parties arising out of or in connection with this Agreement may be brought only in the Delaware Court and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action, claim, or proceeding arising out of or in connection with this Agreement, (iii) waive any objection to the laying of venue of any such action, claim, or proceeding in the Delaware Court, and (iv) waive, and agree not to plead or to make, any claim that any such action, claim, or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.
Section 25. Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which will for all purposes be deemed to be an original but all of which together constitutes one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.
Section 26. Headings. The headings of this Agreement are inserted for convenience only and do not constitute part of this Agreement or affect the construction thereof.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.
| CORE NATURAL RESOURCES, INC. | INDEMNITEE | |
| By: | ||
| Name: | Name: | |
| Office: | Address: | |
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Exhibit 99.1
FOR IMMEDIATE RELEASE
Successful Completion of Merger Creating Core Natural Resources
CANONSBURG, Pa., January 14, 2025 – Core Natural Resources, Inc. (“Core” or the “Company”) today announced the successful completion of the merger of equals between CONSOL Energy Inc. (“CONSOL”) and Arch Resources, Inc. (“Arch”) to form Core, effective January 14, 2025. The proposals required to consummate the merger received the support of more than 99% of the companies’ respective stockholders present and entitled to vote at the stockholder meetings held last week.
Shares of Arch ceased trading prior to market open on January 14, 2025. It is expected that shares of Core will start trading on the New York Stock Exchange under the ticker symbol “CNR” beginning tomorrow, January 15, 2025, and under the ticker symbol “CEIX” until then. Pursuant to the merger agreement, Arch stockholders received 1.326 shares of Core for each issued and outstanding Arch share.
“Today marks a milestone in the proud histories of two great companies,” said Jimmy Brock, Core’s executive chair. “Through this transformational combination, we have created a global leader exceptionally well-positioned to compete and succeed in two significant, high-potential market segments – the global metallurgical and global high-rank thermal coal markets. Through these two core lines of business, the Core team expects to play an essential role in meeting the world’s growing steel, infrastructure, and energy requirements while driving long-term value for its many stakeholders, including stockholders, customers, employees, and the communities in which we live and work.”
“This combination joins two proven leadership teams and best-in-sector operating platforms to create a premier North American coal producer with worldwide reach and world-class mining and logistics capabilities,” said Paul A. Lang, Core’s chief executive officer. “Since the merger’s announcement, the Arch and CONSOL teams have collaborated to lay the foundation for a swift, efficient, and value-creating integration, and we fully intend to hit the ground running in capturing the combination’s substantial synergies and realizing the full potential of the new enterprise. At the same time, we will be building upon the central principles that have served as the bedrock of both Arch’s and CONSOL’s corporate cultures – a deep and unwavering commitment to safety; environmental and social stewardship; integrity; and operational excellence.”
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Potential for Expanded Value Creation
Among many projected benefits, we expect Core to boast:
| • | Best-in-sector metallurgical and thermal coal operating platforms anchored by world-class, high-quality, low-cost, long-lived longwall coal-mining assets |
| • | A broad, diverse slate of coal qualities and blends capable of serving multiple growth markets and geographies |
| • | Industry-leading North American logistics and export capabilities via ownership interests in two East Coast terminals and longstanding relationships with West Coast and Gulf Coast ports |
| • | A visible revenue stream via a strong contracted thermal coal position, coupled with meaningful upside opportunities via its high-value and more market-exposed metallurgical coal platform |
| • | Projected substantial adjusted EBITDA and free cash flow generation across a range of market environments |
| • | Projected operating synergies estimated to deliver $110 million to $140 million of annual cost savings and synergies |
| • | The potential to return significant capital to stockholders while simultaneously making strategic investments in innovation and growth, underpinned by industry-leading cash generation and a strong balance sheet |
Significantly Increased Liquidity
In conjunction with the closing of the merger, Core successfully amended and extended the previous CONSOL revolving credit facility (RCF), upsizing the facility commitments to $600 million from the previous $355 million while extending the maturity to April 30, 2029. Based on its asset diversification, synergy potential, and strong balance sheet, Core received exceptionally strong support for the transaction, with participation from 22 banks including nine new lenders. The facility received strong lender support, with 37% of commitments coming from new lenders and 63% from existing lenders. Additionally, Core successfully reduced the annual interest rate by 75 bps while further enhancing financial flexibility.
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Core Board and Governance Structure
The Core board of directors is comprised of eight members – four directors formerly on the CONSOL board and four directors formerly on the Arch board. As previously disclosed, Jimmy Brock – the former board chair and chief executive officer of CONSOL – will serve as executive chair of Core’s board, and Paul A. Lang – the former chief executive officer and a board member of Arch – will serve as Core’s chief executive officer and as a member of the Core board. Core’s other directors are as follows:
| • | Holly Keller Koeppel (former Arch director) |
| • | Patrick A. Kriegshauser (former Arch director) |
| • | Richard A. Navarre (lead independent director and former Arch board chair) |
| • | Cassandra Pan (former CONSOL director) |
| • | Valli Perera (former CONSOL director) |
| • | Joseph P. Platt (former CONSOL director) |
Core Officers
Core will be led by a proven and highly experienced leadership team. Along with Messrs. Brock and Lang, Core will be led by the following executives:
| • | Mitesh B. Thakkar, President and Chief Financial Officer |
| • | Robert J. Braithwaite, Jr., Senior Vice President, Marketing and Sales |
| • | Rosemary L. Klein, Senior Vice President, Chief Legal Officer, and Corporate Secretary |
| • | Kurt R. Salvatori, Senior Vice President and Chief Administrative Officer |
| • | George J. Schuller Jr., Senior Vice President and Chief Operating Officer |
| • | Deck S. Slone, Senior Vice President, Strategy and Public Policy |
2025 Operating and Financial Guidance
Core expects to provide guidance on key operating and financial metrics at the time of its fourth quarter earnings release.
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About Core
Core Natural Resources is a world-class producer and exporter of high-quality, low-cost coals, including metallurgical and high calorific value thermal coals. The company operates a best-in-sector portfolio, including the Pennsylvania Mining Complex, Leer, Leer South, and West Elk mines. With a focus on seaborne markets, Core plays an essential role in meeting the world’s growing need for steel, infrastructure, and energy, and has ownership interests in two marine export terminals. The company was created in January 2025 via the merger of long-time industry leaders CONSOL Energy and Arch Resources and is based in Canonsburg, Pennsylvania.
Cautionary Statement Regarding Forward-Looking Information
This communication contains certain “forward-looking statements” within the meaning of federal securities laws. Forward-looking statements may be identified by words such as “anticipates,” “believes,” “could,” “continue,” “estimate,” “expects,” “intends,” “will,” “should,” “may,” “plan,” “predict,” “project,” “would” and similar expressions. Forward-looking statements are not statements of historical fact and reflect Core’s current views about future events. Such forward-looking statements include, without limitation, statements about the benefits of the merger, including future financial and operating results, Core’s plans, objectives, expectations and intentions, and other statements that are not historical facts, including estimates of coal reserves, estimates of future production, assumptions regarding future coal pricing, planned delivery of coal to markets and the associated costs, future results of operations, projected cash flow and liquidity, business strategy and other plans and objectives for future operations. No assurances can be given that the forward-looking statements contained in this communication will occur as projected, and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, without limitation, the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the merger may not be fully realized or may take longer to realize than expected; the risk that the credit ratings of Core or its subsidiaries may be different from what Core expects; the risk of adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger; changes in coal prices, which may be caused by numerous factors, including changes in the domestic and foreign supply of and demand for coal and the domestic and foreign demand for steel and electricity; the volatility in commodity and capital equipment prices for coal mining operations; the presence or recoverability of estimated reserves; the ability to replace reserves; environmental and geological risks; mining and operating risks; the risks related to the availability, reliability and cost-effectiveness of transportation facilities and fluctuations in transportation costs; foreign currency, competition, government regulation or other actions; the ability of management to execute its plans to meet its goals; risks associated with the evolving legal, regulatory and tax regimes; changes in economic, financial, political and regulatory conditions; natural and man-made disasters; civil unrest, pandemics, and conditions that may result from legislative, regulatory, trade and policy changes; and other risks inherent in Core’s business.
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All such factors are difficult to predict, are beyond Core’s control, and are subject to additional risks and uncertainties, including those detailed in CONSOL’s annual report on Form 10-K for the year ended December 31, 2023, quarterly reports on Form 10-Q, and current reports on Form 8-K that are available on Core’s website at www.corenaturalresources.com and on the SEC’s website at http://www.sec.gov and those detailed in Arch’s annual report on Form 10-K for the year ended December 31, 2023, quarterly reports on Form 10-Q and current reports on Form 8-K that are available on the SEC’s website at http://www.sec.gov.
Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Core does not undertake any obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
Core Natural Resources, Inc. Contacts
Investors
Deck Slone
314-994-2766
Media
Erica Fisher
724-416-8292
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