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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): June 27, 2006 (June 23, 2006)
Arch Coal, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 1-13105 | 43-0921172 | ||
| (State or other jurisdiction of | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
| incorporation) |
CityPlace One
One CityPlace Drive, Suite 300
St. Louis, Missouri 63141
(Address, including zip code, of principal executive offices)
One CityPlace Drive, Suite 300
St. Louis, Missouri 63141
(Address, including zip code, of principal executive offices)
Registrant’s telephone number, including area code: (314) 994-2700
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions:
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Item 1.01 Entry Into a Material Definitive Agreement.
Amendment to Credit Agreement
On June 23, 2006, Arch Coal, Inc. (the “Company”) entered into an amendment (the “Credit
Amendment”) to its credit agreement, dated December 22, 2004 (the “Credit Agreement”) with the
banks named in the Credit Agreement and PNC Bank, National Association, as administrative agent for
the banks party thereto.
The purpose of the Credit Amendment was to change the pricing grid upon which the interest
rate on borrowings under the credit facility is determined and to extend the maturity dated from
December 22, 2009 to June 23, 2011. Prior to the Credit Amendment, the interest rate on borrowings
under the credit facility was a floating rate based on LIBOR determined by reference to the
Company’s credit rating. As amended, the floating interest rate on borrowings is determined by
reference to the Company’s leverage ratio, as calculated in accordance with the Credit Amendment.
The Credit Amendment also revised certain negative covenants and other provisions to provide
the Company with greater flexibility to pursue strategic investments
and provided the Company the option to increase the maximum amount of
the credit facility from $700.0 million to $800.0 million.
The Company exercised its option concurrently with the closing of the
Credit Amendment. Except as set forth in the
Credit Amendment, the Credit Agreement remains in full force and effect in accordance with its
terms.
As of May 31, 2006, the Company had approximately $25.0 million and $40.3 million of
borrowings and letters of credit, respectively, outstanding under the Credit Agreement.
Some of the banks under the Credit Agreement and/or their affiliates have or may have had
various relationships with the Company and its subsidiaries involving the provision of a variety of
financial services, including investment banking, underwriting and commercial banking services,
including issuances of letters of credit, for which the financial institutions and/or affiliates
receive customary fees, and, in some cases, out-of-pocket expenses.
The Company described the material terms of the Credit Agreement in Item 1.01 of its Current
Report on Form 8-K filed on December 28, 2004, and incorporates that description herein by this
reference, appropriately modified as set forth above.
The foregoing description is only a summary and is qualified in its entirety by the provisions
of the Credit Amendment. Since the terms of the Credit Amendment may differ from the general
information contained herein, you should rely on the actual terms of the Credit Amendment, which is
filed with this report as Exhibit 10.1 and is incorporated by reference herein.
Amendment to Receivables Securitization Program
On June 23, 2006, the Company also entered into an amendment (the “Securitization Amendment”)
to its accounts receivable securitization program (the “Receivables Program”) increasing the size
of the program from $100.0 million to $150.0 million and changing the payments on amounts funded
under the Receivables Program. Prior to the Securitization Amendment, the Company paid fees at
rates that varied with the Company’s debt ratings. As amended, these fees will be determined based
on rates that vary with the Company’s leverage ratio, as calculated in accordance with the
Securitization Amendment. Except as set forth in the Securitization Amendment, the Receivables
Program remains in full force and effect in accordance with its terms.
As of May 31, 2006, the Company had approximately $40.0 million and $56.1 million of
borrowings and letters of credit, respectively, outstanding under the Receivables Program.
The Company described the material terms of the Receivables Program in Item 1.01 of its
Current Report on Form 8-K filed on February 16, 2006, and incorporates that description herein by
this reference, appropriately modified as set forth above.
The foregoing description is only a summary and is qualified in its entirety by the provisions
of the Securitization Amendment. Since the terms of the Securitization Amendment may differ from
the general information contained herein, you should rely on the actual terms of the Securitization
Amendment, which is filed with this report as Exhibit 10.2 and is incorporated by reference herein.
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Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
Information
concerning the amounts for which the Company has become obligated
under the Credit Agreement, as amended by the Credit Amendment, and
under the Receivables Program, as amended by the Securitization
Amendment, set forth above under Item 1.01 is hereby
incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
The following exhibit is attached hereto and filed herewith.
| Exhibit | ||
| No. | Description | |
10.1
|
First Amendment to Credit Agreement, dated as of June 23, 2006, by and among Arch Coal, Inc., the banks party thereto, Citicorp USA, Inc., JPMorgan Chase Bank, N.A. and Wachovia Bank, National Association, each in its capacity as syndication agent, Bank of America, N.A. (as successor-by-merger to Fleet National Bank), as documentation agent, and PNC Bank, National Association, as administrative agent for the banks. | |
10.2
|
Second Amendment to Receivables Purchase Agreement, dated as of June 23, 2006, among Arch Receivable Company, LLC, Arch Coal Sales Company, Inc., Market Street Funding LLC, the various financial institutions party thereto and PNC Bank, National Association, as administrator and as LC Bank. | |
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Signatures
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.
| Dated: June 27, 2006 | Arch Coal, Inc. | |||
| By: | /s/ Robert G. Jones | |||
| Robert G. Jones Vice President – Law, General Counsel and Secretary |
||||
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Exhibit Index
| Exhibit | ||
| No. | Description | |
10.1
|
First Amendment to Credit Agreement, dated as of June 23, 2006, by and among Arch Coal, Inc., the banks party thereto, Citicorp USA, Inc., JPMorgan Chase Bank, N.A. and Wachovia Bank, National Association, each in its capacity as syndication agent, Bank of America, N.A. (as successor-by-merger to Fleet National Bank), as documentation agent, and PNC Bank, National Association, as administrative agent for the banks. | |
10.2
|
Second Amendment to Receivables Purchase Agreement, dated as of June 23, 2006, among Arch Receivable Company, LLC, Arch Coal Sales Company, Inc., Market Street Funding LLC, the various financial institutions party thereto and PNC Bank, National Association, as administrator and as LC Bank. | |
Exhibit 10.1
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the “Amendment”) is dated as of June 23, 2006 and is
made by and among ARCH COAL, INC., a Delaware corporation (the “Borrower”), the BANKS party to the
Credit Agreement (as hereinafter defined), CITICORP USA, INC., JPMORGAN CHASE BANK, N.A. and
WACHOVIA BANK, NATIONAL ASSOCIATION, each in its capacity as co-syndication agent, and BANK OF
AMERICA, N.A. (successor by merger to FLEET NATIONAL BANK), as documentation agent, and PNC BANK,
NATIONAL ASSOCIATION, in its capacity as administrative agent for the Banks.
WHEREAS, the parties hereto are parties to that certain Credit Agreement dated as of December
22, 2004 (the “Credit Agreement”), pursuant to which the Banks provided a $700,000,000 revolving
credit facility to the Borrower; and
WHEREAS, the Borrower, the Banks and the Administrative Agent desire to amend the Credit
Agreement as hereinafter provided.
NOW, THEREFORE, the parties hereto, in consideration of their mutual covenants and agreements
hereinafter set forth and intending to be legally bound hereby, covenant and agree as follows:
1. Definitions.
Capitalized terms used herein unless otherwise defined herein shall have the meanings ascribed
to them in the Credit Agreement, as amended by this Amendment.
2. Amendments to Credit Agreement.
(a) Existing Definitions. Section 1.1 [Certain Definitions] of the Credit Agreement
is hereby amended as follows:
(i) The definition of “Applicable Commitment Fee Rate” is hereby amended and restated in its
entirety as follows:
“Applicable Commitment Fee Rate shall mean, as applicable:
(A) for periods prior to the First Amendment Effective Date:
(i) a rate of .50% per annum for any period when Revolving
Usage is less than 33% of the aggregate Revolving Credit
Commitments,
(ii) a rate of .375% per annum for any period when Revolving
Usage is greater than or equal to 33% of the aggregate
Revolving Credit Commitments but less than 66% of the
aggregate Revolving Credit Commitments, and
(iii) a rate of .250% per annum for any period when Revolving
Usage is greater than or equal to 66% of the aggregate
Revolving Credit Commitments; and
(B) for periods on and after the First Amendment Effective Date, the
rate per annum at the indicated rating level of Leverage Ratio in effect
from time to time as set forth in the pricing grid on Part II of
Schedule 1.1(A) below the heading ‘Commitment Fee’.
Notwithstanding the foregoing, it is expressly agreed that the
Applicable Commitment Fee Rate shall be such amount as set forth in the
pricing grid on Part II of Schedule 1.1(A) in Rating Level
III thereof for the period beginning on the First Amendment Effective Date
and ending on and including the date of the delivery of the financial
statements and related Compliance Certificate as required pursuant to
Section 7.3.3 [Certificate of the Borrower] hereof with respect to the
fiscal quarter of the Borrower ended June 30, 2006, and thereafter the
Applicable Commitment Fee Rate shall be the amount determined under clause
(B) above, as determined in accordance with the parameters set forth on
Part II of Schedule 1.1(A).”
(ii) The definition of “Applicable Letter of Credit Fee Rate” is hereby amended and restated
in its entirety as follows:
“Applicable Letter of Credit Fee Rate shall mean, as
applicable:
(A) for periods prior to the First Amendment Effective Date, the rate
per annum at the indicated rating level of Debt Rating in effect from time
to time as set forth in the pricing grid on Part I of Schedule
1.1(A) below the heading ‘Letter of Credit Fee’, and
(B) for periods on and after the First Amendment Effective Date, the
rate per annum at the indicated rating level of Leverage Ratio in effect
from time to time as set forth in the pricing grid on Part II of
Schedule 1.1(A) below the heading ‘Letter of Credit Fee.’
Notwithstanding the foregoing, it is expressly agreed that for the period
commencing on the Closing Date and through and including June 30, 2005, the
Applicable Letter of Credit Fee Rate shall be such amount as determined in
accordance with Part I of Schedule 1.1(A) but no less than
the amount set forth in the pricing grid in Rating Level III thereof.
Commencing on July 1, 2005 and through but not including the First Amendment
Effective Date the Applicable Letter of Credit Fee Rate shall be the amount
determined under clause (A) above, as determined in accordance with the
parameters set forth on Part I of Schedule 1.1(A). For the
period beginning on the First Amendment Effective Date and ending on and
including the date of the delivery of the financial statements and related
Compliance Certificate as required pursuant to Section 7.3.3 [Certificate of
the Borrower] hereof with respect to the fiscal quarter of the Borrower
ended June 30, 2006, it is expressly agreed that the Applicable Letter of
Credit Fee Rate shall be the amount set forth on Part II of
Schedule 1.1(A) in the pricing grid in Rating Level III thereof, and
thereafter the Applicable Letter of Credit Fee Rate shall be the amount
determined under clause (B) above, as determined in accordance with the
parameters set forth on Part II of Schedule 1.1(A).”
(iii) The definition of “Applicable Margin” is hereby amended and restated in its entirety as
follows:
“Applicable Margin shall mean, as applicable:
(A) for periods prior to the First Amendment Effective Date:
(i) the percentage spread to be added to Euro-Rate under the
Euro-Rate Option at the indicated rating level of Debt Rating
in effect from time to time as set forth in the pricing grid
on Part I of Schedule 1.1(A) below the
heading ‘Revolving Credit Euro-Rate Spread,’ or
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(ii) the percentage spread to be added to the Base Rate under
the Base Rate Option at the indicated rating level of Debt
Rating in effect from time to time as set forth in the
pricing grid on Part I of Schedule 1.1(A)
below the heading ‘Revolving Credit Base Rate Spread’; and
(B) for periods on and after the First Amendment Effective Date:
(i) the percentage spread to be added to Euro-Rate under the
Euro-Rate Option at the indicated rating level of Leverage
Ratio in effect from time to time as set forth in the pricing
grid on Part II of Schedule 1.1(A) below the
heading ‘Revolving Credit Euro-Rate Spread,’ or
(ii) the percentage spread to be added to the Base Rate under
the Base Rate Option at the indicated rating level of
Leverage Ratio in effect from time to time as set forth in
the pricing grid on Part II of Schedule
1.1(A) below the heading ‘Revolving Credit Base Rate
Spread’.
The Applicable Margin shall be computed in accordance with the parameters
set forth on Schedule 1.1(A).
Notwithstanding the foregoing, it is expressly agreed that for the period
commencing on the Closing Date and through and including June 30, 2005, the
Applicable Margin shall be such amount as determined in accordance with
Part I of Schedule 1.1(A) but no less than the amount set
forth in the pricing grid in Rating Level III thereof. Commencing on July
1, 2005 and through but not including the First Amendment Effective Date the
Applicable Margin shall be the amount determined under clause (A) above, as
determined in accordance with the parameters set forth on Part I of
Schedule 1.1(A). For the period beginning on the First Amendment
Effective Date and ending on and including the date of the delivery of the
financial statements and related Compliance Certificate as required pursuant
to Section 7.3.3 [Certificate of the Borrower] hereof with respect to the
fiscal quarter of the Borrower ended June 30, 2006, it is expressly agreed
that the Applicable Margin shall be the amount set forth on Part II
of Schedule 1.1(A) in the pricing grid in Rating Level III thereof,
and thereafter the Applicable Margin shall be the amount determined under
clause (B) above, as determined in accordance with the parameters set forth
on Part II of Schedule 1.1(A).”
(iv) The definition of “Documentation Agent” is hereby amended and restated in its entirety as
follows:
“Documentation Agent shall mean Bank of America, N.A. (as successor by
merger to Fleet National Bank) in its capacity as documentation agent for the Banks
under this Agreement.”
(v) The definition of “Expiration Date” is hereby amended and restated in its entirety as
follows:
“Expiration Date shall mean, with respect to the Revolving Credit
Commitments and Swing Loan Commitment, June 23, 2011.”
(vi) The definition of “Permitted Joint Venture” is hereby amended and restated in its
entirety as follows:
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“Permitted Joint Venture shall mean any Person (i) with respect to
which the ownership of equity interests thereof by the Borrower or any Subsidiary of
the Borrower is accounted for in accordance with the “equity method” in accordance
with GAAP; (ii) engaged in a line of business permitted by Section 7.2.7
[Continuation of or Change in Business]; and (iii) with respect to which the equity
interests thereof were acquired by the Borrower or Subsidiary of the Borrower in an
arms-length transaction; provided that any such Person shall be treated for purposes
of this Agreement as a Subsidiary and not a Permitted Joint Venture if (A) the
Borrower has management control over the operations of such Person and (B) the
Borrower owns directly or indirectly at least fifty percent (50%) of the economic
equity interest in such Person.”
(vii) The definition of “Permitted Receivables Financing” is hereby amended and restated in
its entirety as follows:
“Permitted Receivables Financing shall mean a transaction or series of
transactions pursuant to which a Securitization Subsidiary purchases Receivables
Assets or interests therein from the Borrower or any Subsidiary of the Borrower and
finances such Receivables Assets or interests therein through the issuance of
Indebtedness or equity interests or through the sale of such Receivables Assets or
interests therein; provided that (a) the Board of Directors of the Borrower
shall have approved such transaction, (b) no portion of the Indebtedness of a
Securitization Subsidiary is guarantied by or is recourse to the Borrower or any of
its other Subsidiaries (other than recourse for customary representations,
warranties, covenants and indemnities, none of which shall related to the
collectibility of such Receivables Assets), and (c) neither the Borrower nor any of
its other Subsidiaries has any obligation to maintain or preserve such
Securitization Subsidiary’s financial condition. The February, 2006 Receivables
Financing is a Permitted Receivables Financing.”
(viii) The definition of “Revolving Credit Commitment” is hereby amended and restated in its
entirety as follows:
“Revolving Credit Commitment shall mean, as to any Bank at any time,
the amount initially set forth opposite its name on Schedule 1.1(B) in the
column labeled ‘Amount of Commitment for Revolving Credit Loans,’ and thereafter as
determined by the Administrative Agent after giving effect to each applicable Bank
Joinder and Assignment and Assumption Agreement executed by such Bank and delivered
to the Administrative Agent, and Revolving Credit Commitments shall mean the
aggregate Revolving Credit Commitments of all of the Banks.”
(b) New Definitions. Section 1.1 [Certain Definitions] of the Credit Agreement is
hereby further amended to add the following new definitions with each new definition to be inserted
in correct alphabetical order therein:
“Additional Bank shall have the meaning assigned to that term in
Section 10.11.5 [Joinder of an Additional Bank, etc.].”
“Bank Joinder shall mean a Bank Joinder and Assumption Agreement
substantially in the form of Exhibit 1.1(B)(1).”
“February, 2006 Receivables Financing shall mean the receivables
financing pursuant to the following agreements each dated February 3, 2006, as
subsequently amended: (1) Purchase and Sale Agreement by and among Arch Coal Sales
Company, Inc., certain of the Borrower’s Subsidiaries as the Originators thereunder
and the Borrower, (2) the Sale and Contribution Agreement by and among the Borrower
and Arch Receivable Company, LLC, (3) the Receivables Purchase Agreement by and
among Arch Receivable Company, LLC, Arch Coal Sales Company, Inc., Market Street
Funding LLC, as issuer, certain financial institutions from time to time parties
thereto, as LC Participants (as defined therein), and PNC Bank, National
Association, as
5
Administrator on behalf of the Purchasers and as LC Bank, and (4) other related
agreements and documents.”
“First Amendment shall mean that certain First Amendment to Credit
Agreement, dated as of June 23, 2006, among the Borrower, the Banks, the
Administrative Agent and the other Agents.”
“First Amendment Effective Date shall mean the effective date of the
First Amendment, which date is June 23, 2006.”
“Special Joint Venture shall have the meaning assigned to that term in
Section 7.1.12 [Collateral; Further Assurances].”
(c) Issuance of Letters of Credit. Section 2.9.1 [Issuance of Letters of Credit] of
the Credit Agreement is hereby amended by deleting the Dollar amount of “$600,000,000” appearing in
clause (B) (i) of the first paragraph of such section and inserting in lieu thereof the Dollar
amount “$700,000,000”.
(d) Right to Increase Revolving Credit Commitments. Article 2 [Revolving Credit and
Swing Loan Facilities] of the Credit Agreement is hereby amended by inserting the following new
Section 2.10 immediately after Section 2.9 [Letter of Credit Subfacility] appearing therein:
“2.10 Right to Increase Commitments.
Provided that there is no Event of Default or Potential Default, if on
or after the First Amendment Effective Date the Borrower wishes to increase
the Revolving Credit Commitments, the Borrower shall notify the
Administrative Agent thereof, provided that any such increase shall be in a
minimum of $25,000,000 and the aggregate of all such increases in the
Revolving Credit Commitments shall not exceed $100,000,000. The increased
commitments shall be available to Banks and to any additional bank proposed
by the Borrower, which is approved by the Administrative Agent (which
approval shall not be unreasonably withheld) and allocated in such a manner
as the Borrower, the Administrative Agent and those increasing Banks and new
banks shall agree, provided, however, that each new bank shall become a
party to this Agreement pursuant to Section 10.11 [Successors and Assigns].
In the event of any such increase in the aggregate Revolving Credit
Commitments effected pursuant to the terms of this Section 2.10, new
Revolving Credit Notes shall, to the extent necessary, be executed and
delivered by the Borrower in exchange for the surrender of the existing
Revolving Credit Notes. Without limiting the generality of Section 7.1.12
[Collateral; Further Assurances], in the event the Borrower exercises its
rights under this Section 2.10, the Borrower shall and shall cause each Loan
Party, at its expense and within sixty (60) days following the date of the
increase of the Revolving Credit Commitments, to execute, deliver and record
amendments to each Mortgage (with such amendments to be in form and
substance reasonably satisfactory to the Administrative Agent), to reflect
any such increase in the Revolving Credit Commitments as required by
applicable Law or as the Administrative Agent, in its reasonable discretion,
may require.”
(e) Interest Rate Options. Section 3.1.1 [Interest Rate Options] of the Credit
Agreement is hereby amended by deleting the second and third to last sentences thereof and
inserting in lieu thereof the following:
“Notwithstanding the foregoing, for the period commencing on the Closing Date
through and including June 30, 2005, the Applicable Margin shall be the amount
determined in accordance with the parameters set forth in Part I of
Schedule 1.1(A) but shall be no less than the amount set forth in the
pricing grid under Rating Level III thereof. Commencing on July 1, 2005 and
thereafter through but not including the First Amendment Effective Date, the
Applicable Margin shall be determined based upon the applicable Debt Rating in
effect from time to time, as set forth
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in Part I of Schedule 1.1(A). For the period commencing on the
First Amendment Effective Date through and including the date of the delivery of the
financial statements and related Compliance Certificate as required by Section 7.3.3
[Certificate of the Borrower] hereof with respect to the fiscal quarter of the
Borrower ended June 30, 2006, the Applicable Margin shall be the amount set forth on
Part II of Schedule 1.1(A) in the pricing grid in Rating Level III
thereof, and thereafter the Applicable Margin shall be determined based upon the
applicable Leverage Ratio in effect from time to time, as set forth in Part
II of Schedule 1.1(A) in accordance with the parameters thereof.”
(f) Change in Fees or Interest Rates. The first paragraph of Section 3.1.3 [Change in
Fees or Interest Rates] of the Credit Agreement is hereby amended and restated in its entirety to
read as follows:
“If the Applicable Margin or Applicable Commitment Fee Rate is increased or
reduced with respect to any period prior to the First Amendment Effective Date for
which the Borrower has already paid interest or Commitment Fees, the Administrative
Agent shall recalculate the additional interest or Commitment Fees due from or to
the Borrower and shall, within fifteen (15) Business Days after the Borrower
notifies the Administrative Agent of any change in the Debt Rating, give the
Borrower and the Banks notice of such recalculation. If the Applicable Margin or
Applicable Commitment Fee Rate is increased or reduced with respect to any period on
or after the First Amendment Effective Date for which the Borrower has already paid
interest or Commitment Fees, the Administrative Agent shall recalculate the
additional interest or Commitment Fees due from or to the Borrower and shall, within
fifteen (15) Business Days after the Borrower notifies the Administrative Agent of
such increase or decrease, give the Borrower and the Banks notice of such
recalculation.”
(g) Mandatory Reduction of Commitments. Section 4.4.5 [Mandatory Reduction of
Commitments] of the Credit Agreement is hereby amended by deleting the Dollar amount “$100,000,000”
appearing in the last sentence thereof and inserting in lieu thereof the Dollar amount
“$200,000,000”.
(h) Financial Projections. Clause (iii) [Financial Projections] of Section 5.1.7
[Financial Statements] of the Credit Agreement is hereby amended and restated in its entirety as
follows:
“(iii) Financial Projections.
On or before the Closing Date, the Borrower has delivered to the
Administrative Agent financial projections of the Borrower and its
Subsidiaries, on a consolidated and consolidating basis, for the period
January 1, 2004 through and including December 31, 2008 derived from various
assumptions of the Borrower’s management (the ‘Original Financial
Projections’). On or before the First Amendment Effective Date, the
Borrower has delivered to the Administrative Agent updated financial
projections of the Borrower and its Subsidiaries, on a consolidated and
consolidating basis, for the period January 1, 2006 through and including
December 31, 2008 derived from various assumptions of the Borrower’s
management (the ‘Updated Financial Projections’ and together with the
Original Financial Projections, sometimes collectively referred to as the
‘Financial Projections’). The Financial Projections represent a reasonable
range of possible results in light of the history of the business, present
and foreseeable conditions and the intentions of the Borrower’s management.
The Financial Projections accurately reflect, in all material respects on a
consolidated basis, the liabilities of the Borrower and its Subsidiaries
upon consummation of the transactions contemplated hereby, including,
without limitation the transactions contemplated as of the Closing Date and
as of the First Amendment Effective Date.”
(i) Use of Proceeds. Section 7.1.9 [Use of Proceeds] of the Credit Agreement is
hereby amended and restated in its entirety as follows:
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“7.1.9 Use of Proceeds.
The Borrower will use the Letters of Credit and the proceeds of the
Loans only (i) to refinance indebtedness under the Existing Credit
Agreement, and (ii) for general corporate purposes and for working capital
of the Loan Parties, including, without limitation, that: (A) proceeds of
Loans may be used by the Borrower to make loans to or investments in the
Arch Western Group or any Bonding Subsidiary, (B) proceeds of Loans may be
used, subject to Section 7.1.16 [Purchase, Redemption or Defeasance of AWR
Senior Notes], for purchase, redemption or defeasance of the AWR Senior
Notes, and (C) Letters of Credit may be issued for the benefit or the use of
any member of the Arch Western Group or any Bonding Subsidiary. The use of
the Letters of Credit and the proceeds of the Loans shall not be for any
purpose which contravenes any applicable Law or any provision of this
Agreement or any other Loan Document.”
(j) Collateral; Further Assurances. Section 7.1.12 [Collateral; Further Assurances] of the
Credit Agreement is hereby amended by inserting at the end thereof the following new paragraphs:
“Without limiting the generality of any of the foregoing in this
Section 7.1.12, the Borrower shall and shall cause each Loan Party, within
sixty (60) days following the First Amendment Effective Date, or such later
date as reasonably acceptable to the Administrative Agent, at the Borrower’s
and such Loan Party’s expense to record such amendments to each Mortgage as
required by applicable Law, with such amendments to be in form and substance
reasonably satisfactory to the Administrative Agent, to reflect the extended
Expiration Date, as amended by the First Amendment.
Notwithstanding the foregoing provisions of this Section 7.1.12, if a
Person becomes a Significant Subsidiary of the Borrower either: (i) as a
result of any Investment in such Person as a Permitted Joint Venture
permitted by Section 7.2.6 [Subsidiaries, Partnerships and Joint Ventures],
or (ii) as a result of any Investment in such Person pursuant to an
Investment permitted by clause (viii) of Section 7.2.14 [Loans and
Investments] (a Person described in the immediately preceding clause (i) or
clause (ii) is sometimes referred to as a ‘Special Joint Venture’), such
Special Joint Venture shall not be required to become a Loan Party
(including, without limitation such Special Joint Venture shall not be
required to provide the Collateral required pursuant to this Section 7.1.12)
nor shall the Borrower or any Subsidiary of the Borrower be required to
pledge the equity interests of such Special Joint Venture if and only if and
to the extent that the limited liability company agreement, limited
partnership agreement, joint venture agreement, general partnership
agreement or other constituent documents of such Special Joint Venture or
other material agreement related to the Investment in such Special Joint
Venture would prohibit the granting of such Liens or prohibit such Special
Joint Venture from being a Loan Party under the Loan Documents.”
(k) Commitment Reduction Related to Certain Permitted Receivables Financing. Section
7.1.15 [Commitment Reduction Related to Certain Permitted Receivables Financing] of the Credit
Agreement is hereby amended by deleting the Dollar amount “$100,000,000” appearing in clause (i) of
such Section and inserting in lieu thereof the Dollar amount “$200,000,000.”
(l) Purchase, Redemption or Defeasance of AWR Senior Notes. The Credit Agreement is
hereby amended to add to Section 7.1 [Affirmative Covenants] the following new Section 7.1.16
[Purchase, Redemption or Defeasance of AWR Senior Notes] immediately following Section 7.1.15
[Commitment Reduction Related to Certain Permitted Receivables Financing]:
“7.1.16 Purchase, Redemption or Defeasance of AWR Senior Notes.
Subject to the terms and conditions of this Agreement, proceeds of the
Loans may be used to purchase, redeem or defease the AWR Senior Notes, so
long as:
8
(i) after giving effect to such Loans the Revolving Credit
Commitments shall exceed the Revolving Facility Usage by at
least $100,000,000 and no Potential Default or Event of
Default shall exist or be continuing;
(ii) all of the proceeds of such Loans are used to reduce the
outstanding principal amount of the Eligible Note Receivable;
and
(iii) the Borrower shall cause Arch Western and Arch Western
Finance LLC to use the amount of each repayment of principal
of the Eligible Note Receivable required by clause (ii)
immediately above to purchase, redeem or defease the AWR
Senior Notes.”
(m) Liens, Guaranties. Section 7.2.2 [Liens; Guaranties] of the Credit Agreement is
hereby amended by deleting the first paragraph thereof and inserting in lieu thereof the following:
“The Borrower shall not, and shall not permit any of its Subsidiaries to, (i)
at any time create, incur, assume or suffer to exist any Lien on any of its
respective property or assets, tangible or intangible, now owned or hereafter
acquired, or agree or become liable to do so, except, in the case of the Borrower,
any Bonding Subsidiary, the Arch Coal Group, Arch Western, any Securitization
Subsidiary or any Subsidiary of Arch Western, Permitted Liens, and (ii) at any time,
directly or indirectly, enter into any agreement (other than (A) the AWR Senior
Notes Indenture, and (B) agreements relating to Permitted Receivables Financing),
understanding or other arrangement which purports to prohibit or limit in any manner
the ability of the Borrower or any Subsidiary of the Borrower to grant security
interests or Liens with respect to any of its respective property or assets.”
(n) Acquisitions, Etc. Section 7.2.3 [Liquidations, Mergers, Consolidations,
Acquisitions] of the Credit Agreement is hereby amended by inserting immediately after clause (3)
thereof and immediately before the period (“.”) therein the following:
”, and
(4) the Borrower or any of its Subsidiaries may acquire by purchase, lease or
otherwise all or substantially all of the assets or equity interests of a
Securitization Subsidiary, and a Securitization Subsidiary may dissolve, liquidate
or wind-up its affairs or become a party to any merger or consolidation”
(o) Disposition of Assets. Section 7.2.4 is hereby amended by: (1) deleting the very
last word (such word being the word “and”) in clause (iv) immediately following the “;” in the last
line of such clause; and (2) amending and restating clause (v) in its entirety to read as set forth
below and adding, immediately thereafter, new clause (vi):
”(v) any sale, transfer or lease of assets, other than those specifically
excepted pursuant to clauses (i) through (iv) above or pursuant to clause(vi) below,
provided, that with respect to any sale any sale, transfer or lease of assets,
pursuant to this Section 7.2.4(v): (a) at the time of any such disposition, no Event
of Default shall exist or shall result from such disposition, (b) the Borrower and
its Subsidiaries shall be in compliance with the covenants contained in Sections
7.2.10 [Maximum Leverage Ratio], 7.2.11 [Maximum Senior Secured Leverage Ratio], and
7.2.12 [Minimum Interest Coverage Ratio] determined on a pro forma basis after
giving effect to each such sale, transfer or lease of assets, and (c) the aggregate
net book value, as determined in accordance with GAAP, of all assets so sold,
transferred, or leased by the Borrower and its Subsidiaries as permitted by this
clause (v) shall not exceed in any calendar year $75,000,000; and
(vi) any sale, transfer, lease or disposition of assets for fair value as part
of an Investment which is either (y) an Investment in a Permitted Joint Venture
which is permitted by
9
clause (1) or clause (2) of Section 7.2.6 [Subsidiaries, Partnerships and
Joint Ventures], or (z) an Investment permitted by clause (viii) of Section 7.2.14
[Loans and Investments].”
(p) Affiliate Transactions. Section 7.2.5 [Affiliate Transactions] of the Credit
Agreement is hereby amended by deleting the word “and” appearing immediately before clause (iii)
thereof and inserting immediately after clause (iii) thereof and immediately before the period
(“.”) therein the following:
”, and (iv) this Section 7.2.5 shall not prohibit any transaction provided for
in, or in connection with, a Permitted Receivables Financing”
(q) Joint Ventures, Etc. Section 7.2.6 [Subsidiaries, Partnerships and Joint
Ventures] of the Credit Agreement is hereby amended and restated in its entirety as follows:
“7.2.6 Subsidiaries, Partnerships and Joint Ventures.
The Borrower shall not, and shall not permit any of its Subsidiaries to, own or
create directly or indirectly any Subsidiaries other than (i) Subsidiaries (other
than any Securitization Subsidiary which is the subject of clause (iii) below) which
are not Significant Subsidiaries, (ii) any Significant Subsidiary which has complied
with Section 10.18 [Requirements for Significant Subsidiaries], and (iii) any
Securitization Subsidiary whose equity interests are pledged to the Collateral Agent
for the benefit of the Banks (with the Pledge Agreement therefor to be in form and
substance satisfactory to the Administrative Agent) and which has otherwise complied
with Section 10.18 [Requirements for Significant Subsidiaries]. Neither the
Borrower nor any Subsidiary of the Borrower shall become or agree to become a
general or limited partner in any general or limited partnership, a member or
manager of, or hold a limited liability company interest in, a limited liability
company or a joint venturer or hold a joint venture interest in any joint venture,
except that:
(1) the Loan Parties may, prior to the First Amendment
Effective Date, make an Investment (as a general or limited
partner in a partnership, as a member or manager of a limited
liability company, as a holder of a limited liability company
interest in a limited liability company, or as a joint
venturer or holder of a joint venture interest in a joint
venture) in a Permitted Joint Venture; provided,
however, that the aggregate Investments permitted by
this clause (1) of Section 7.2.6 in all such Permitted Joint
Ventures shall not at any time exceed, for all Loan Parties
and their Subsidiaries, the aggregate amount of $150,000,000;
(2) the Loan Parties may, on or after the First Amendment
Effective Date, make an Investment in a Permitted Joint
Venture, so long as the Borrower and its Subsidiaries at all
times are in compliance with all requirements of the
following clauses (A) through (H):
(A) the Permitted Joint Venture is either a limited liability
company or a limited partnership;
(B) the Investment made in a Permitted Joint Venture permitted
under clause(2)(A) immediately above is either (y) of the type
described in clauses (i), (ii) or (iv) of the definition of
Investment, or (z) of the type described in clauses (iii) or (v) of
the definition of Investment and, on the date such Investment is
made, the amount of the Guaranty or other obligation, as the case may
be, is reasonably estimable;
10
(C) other than the amount of an Investment permitted under
clause (2)(B) immediately above of the type described in clause (iii)
or clause (v) of the definition of Investment, there is no recourse
to any Loan Party or any Subsidiary of any Loan Party for any
Indebtedness or other liabilities or obligations (contingent or
otherwise) of the Permitted Joint Venture;
(D) at least five (5) Business Days prior to making any
Investment in a Permitted Joint Venture which is otherwise permitted
by this clause (2) of this Section 7.2.6, the Borrower shall have
delivered to the Administrative Agent all material agreements,
documents and instruments in connection with or related to such
Investment;
(E) the Borrower and its Subsidiaries shall be in compliance
with the covenants contained in Sections 7.2.10 [Maximum Leverage
Ratio], 7.2.11 [Maximum Senior Secured Leverage Ratio], and 7.2.12
[Minimum Interest Coverage Ratio] determined on a pro forma basis
after giving effect to each Investment permitted by this clause (2)
of this Section 7.2.6 (including in such computation Indebtedness or
other liabilities assumed or incurred in connection with such
Investment as if such liabilities were incurred as of the first day
of the applicable period of determination and, if the Permitted Joint
Venture in which the Investment is made is a Special Subsidiary, then
including in such computation the Appropriate Percentage of EBITDA of
such Special Subsidiary as of the first day of the period of
determination (with EBITDA of such Special Subsidiary based upon
financial statements reasonably acceptable to the Administrative
Agent)), and the Borrower shall have delivered to the Administrative
Agent and each Bank a compliance certificate demonstrating such
pro-forma compliance (such certificate to be in form and substance
reasonably acceptable to the Administrative Agent) prior to making
any Investment otherwise permitted by this clause (2) of this Section
7.2.6;
(F) after giving effect to each Investment in a Permitted Joint
Venture which is otherwise permitted by this clause (2) of this
Section 7.2.6, the Revolving Credit Commitments shall exceed the
Revolving Facility Usage by at least $75,000,000;
(G) no Potential Default or Event of Default shall exist
immediately prior to and after giving effect to each Investment in a
Permitted Joint Venture which is otherwise permitted by this clause
(2) of this Section 7.2.6; and
(H) without limiting the generality of clause (G) immediately
above, after giving effect to each Investment otherwise permitted by
this clause (2) of this Section 7.2.6, the Borrower and its
Subsidiaries shall be in compliance with clause (v) of Section 7.2.14
[Loans and Investments];
(3) the Loan Parties may be general or limited partners in
other Loan Parties or be members or managers of, or hold
limited liability company interests in, other Loan Parties
and except that the Borrower may hold a limited liability
company interest in Arch Western and Arch Western may hold
limited liability company interests in its Subsidiaries which
are members of the Arch Western Group; and
(4) the Borrower and its Subsidiaries may be general or
limited partners in, or be members or managers of, or hold
limited liability company interests in, any Securitization
Subsidiary.”
11
(r) No Restriction in Agreements on Dividends, Loans. Section 7.2.13 [No Restriction
in Agreements on Dividends or Certain Loans] of the Credit Agreement is hereby amended and restated
in its entirety as follows:
“7.2.13 No Restriction in Agreements on Dividends or Certain Loans.
The Borrower shall not, and shall not permit any of its Subsidiaries
to, enter into or be bound by any agreement which prohibits or restricts, in
any manner, the payment of dividends (whether in cash, securities, property
or otherwise), other than: (i) restrictions applicable to Arch Western set
forth in the Arch Western LLC Agreement, (ii) restrictions that are
applicable to the Arch Western Group as set forth in the AWR Senior Notes
Indenture, and (iii) restrictions applicable to a Securitization Subsidiary
in connection with a Permitted Receivables Financing. The Borrower shall
not, and shall not permit any of its Subsidiaries to, enter into or be bound
by any agreement which prohibits or restricts, in any manner the making of
any loan to the Borrower by any member of the Arch Western Group, other than
(i) restrictions applicable to Arch Western set forth in the Arch Western
LLC Agreement, (ii) restrictions that are applicable to the Arch Western
Group as set forth in the AWR Senior Notes Indenture, and (iii) restrictions
applicable to a Securitization Subsidiary in connection with a Permitted
Receivables Financing.”
(s) Certain Investments. Clause (vi) of Section 7.2.14 [Loans and Investments] of the
Credit Agreement is hereby amended and restated in its entirety as follows:
"(vi) loans by the Borrower to any Bonding Subsidiary or
reimbursement obligations by the Borrower to an Issuing Bank
with respect to any Letter of Credit issued for the direct or
indirect benefit of, any member of the Arch Western Group or
any Bonding Subsidiary; provided, however,
that: (x) prior to any Letter of Credit being issued for the
direct or indirect benefit of any member of the Arch Western
Group or any Bonding Subsidiary, the applicable member of the
Arch Western Group or applicable Bonding Subsidiary, as the
case may be, shall have entered into a customary
reimbursement agreement with Borrower with respect to such
Letter of Credit, and Borrower shall have provided a copy of
such reimbursement agreement to the Administrative Agent; (y)
prior to any loan being made to any Bonding Subsidiary, such
loan shall be evidenced by a note, reasonably satisfactory to
the Administrative Agent, and such note shall be pledged
pursuant to the applicable Collateral Document to the
Collateral Agent for the benefit of the Banks, and (z) any
loans by the Borrower to any Bonding Subsidiary or any
reimbursement obligations by the Borrower to an Issuing Bank
with respect to any Letter of Credit issued for the benefit
of any Bonding Subsidiary shall in each and every case be
subject to Section 7.2.17 [Transactions with Respect to AWAC;
Transactions With Respect to the Bonding Subsidiaries];”
(t) Certain Investments. Clause (viii) of Section 7.2.14 [Loans and Investments] of
the Credit Agreement is hereby amended and restated in its entirety as follows:
"(viii) other Investments, in connection with or related to
the operations of the Borrower and its Subsidiaries, not
exceeding $100,000,000 in the aggregate in any fiscal year
(the “Annual Maximum Investment”) of the Borrower (it being
expressly understood and agreed that Investments of the type
described in clause (iii) or clause (v) of the definition of
Investment shall be included in the calculation of the Annual
Maximum Investment solely in the fiscal year of the Borrower
in which the Borrower or its Subsidiary, as the case
12
may be, enters into an agreement (whether written or oral) or
otherwise incurs an obligation to provide an Investment of
either such type for the benefit of the Person in which such
an Investment is made and the amount of the Guaranty or other
obligation, as the case may be, is reasonably estimable);”
(u) Changes in Organizational Documents. Section 7.2.16 [Changes in Organizational
Documents] of the Credit Agreement is hereby amended and restated in its entirety as follows:
“7.2.16 Changes in Organizational Documents.
The Borrower shall not, and shall not permit any of its Subsidiaries
to, amend in any respect 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
without providing at least ten (10) calendar days’ prior written notice to
the Administrative Agent and the Banks and, in the event such change would
be adverse to the Banks as determined by the Administrative Agent in its
sole discretion, obtaining the prior written consent of the Required Banks,
provided, however, that this Section 7.2.16 shall not
require the consent of the Required Banks to any such change to the limited
liability company agreement or other organizational documents of any
Securitization Subsidiary made to facilitate any Permitted Receivables
Financing.”
(v) Joinder of Banks. Section 10.11 [Successors and Assigns] of the Credit Agreement
is hereby amended by inserting the following new Section 10.11.5 immediately following Section
10.11.4 [Assignments by Banks to Federal Reserve Banks] appearing therein:
“10.11.5 Joinder of an Additional Bank and Increased
Commitment.
A bank which is to become a party to this Agreement pursuant to Section
2.10 hereof (each an ‘Additional Bank’) and each existing Bank which
increases its Revolving Credit Commitment in accordance with Section 2.10
[Right to Increase Commitments] shall execute and deliver to Administrative
Agent a Bank Joinder to this Agreement in substantially the form attached
hereto as Exhibit 1.1(B)(1). Upon execution and delivery of a Bank
Joinder, such Additional Bank shall be a party hereto and a Bank under each
of the Loan Documents for all purposes. Immediately prior to the effective
date of such Bank Joinder, the Borrower shall either convert Loans subject
to the Euro-Rate Option to Loans subject to the Base Rate Option or prepay,
in accordance with the provisions of Section 4.4 [Prepayments], such Loans
subject to the Euro-Rate Option (subject, in either case, to the payment and
indemnity provisions of the Credit Agreement, including, without limitation,
the provisions of Section 4.5.2 [Indemnity]) so that on the effective date
of such Bank Joinder there shall be no Loans outstanding that are subject to
the Euro-Rate Option. Schedule 1.1(B) shall be deemed to be
automatically amended and restated on the effective date of such Bank
Joinder to revise the information contained therein as appropriate to
reflect the information on the attachment to such Bank Joinder.
Simultaneously with the execution and delivery of such Bank Joinder, the
Borrower shall execute a Revolving Credit Note and deliver it to such
Additional Bank, or an amended and restated Revolving Credit Note and
deliver it to such existing Bank, to provide for the increase in such
existing Bank’s Revolving Credit Commitment, together with originals of such
other documents described in Section 6.1 [First Loans and Letters of Credit]
hereof as such Additional Bank or such existing Bank may reasonably
require.”
(w) Collateral. Section 10.18.2 [Collateral] of the Credit Agreement is hereby
amended by deleting the last paragraph thereof and inserting in lieu thereof the following:
13
“With respect to each Securitization Subsidiary (including each Securitization
Subsidiary which is formed after the Closing Date) the Borrower shall within thirty
(30) days following the date such Person becomes a Securitization Subsidiary: (i)
cause all of the issued and outstanding capital stock, partnership interests, member
interests or other equity interests of such Securitization Subsidiary that are owned
by the Borrower or another Loan Party to be pledged on a first priority perfected
basis to the Collateral Agent for the benefit of the Banks pursuant to the Pledge
Agreements, (ii) deliver opinions of legal counsel, with respect to such
Securitization Subsidiary, including opinions of local counsel in each applicable
jurisdiction, as such opinions may be reasonably required by the Administrative
Agent and with such opinions to be satisfactory in form, scope and substance to the
Administrative Agent in its reasonable discretion, and (iii) obtain Uniform
Commercial Code, lien, tax, and judgment searches (including searches of the
applicable real estate indexes), with the results, form scope and substance of such
searches to be satisfactory to the Administrative Agent.”
(x) Requirements for Significant Subsidiaries. Section 10.18 [Requirements for
Significant Subsidiaries] of the Credit Agreement is hereby further amended to add, immediately
following Section 10.18.2 [Collateral] the following new Section 10.18.3 [Requirements for Special
Joint Ventures]:
“10.18.3 Requirements for Special Joint Ventures.
Notwithstanding the foregoing provisions of this Section 10.18, no
Special Joint Venture shall be required to become a Loan Party (including,
without limitation such Special Joint Venture shall not be required to
provide a Guarantor Joinder or provide the Collateral required pursuant to
Section 7.1.12 [Collateral; Further Assurances] or this Section 10.18) nor
shall the Borrower or any Subsidiary of the Borrower be required to pledge
the equity interests of such Special Joint Venture if and only if and to the
extent that the limited liability company agreement, limited partnership
agreement, joint venture agreement, general partnership agreement or other
constituent documents of such Special Joint Venture or other material
agreement related to the Investment in such Special Joint Venture would
prohibit the granting of such Liens or prohibit such Special Joint Venture
from being a Loan Party under the Loan Documents.”
(y) Pricing Grid. Schedule 1.1(A) — Pricing Grid of the Credit Agreement
is hereby amended and restated in its entirety as set forth on the schedule titled as Schedule
1.1(A) — Pricing Grid attached hereto.
(z) Assignment and Assumption Agreement. Exhibit 1.1(A) —Assignment and
Assumption Agreement of the Credit Agreement is hereby amended and restated in its entirety as
set forth on the exhibit titled Exhibit 1.1(A) —Assignment and Assumption
Agreement attached hereto.
(aa) Bank Joinder. New Exhibit 1.1(B)(1) — Bank Joinder is hereby
added to the Credit Agreement in the form as set forth on the exhibit titled as Exhibit
1.1(B)(1) — Bank Joinder attached hereto.
(bb) Quarterly Compliance Certificate. Exhibit 7.3.3 — Quarterly
Compliance Certificate to the Credit Agreement is hereby amended and restated in its entirety
as set forth on the exhibit titled as Exhibit 7.3.3 — Quarterly Compliance
Certificate attached hereto.
3. Conditions of Effectiveness of Amendments.
The effectiveness of this Amendment is expressly conditioned upon satisfaction of each of the
following conditions precedent:
(a) Officer’s Certificate.
The representations and warranties of the Borrower contained in Section 5 of the Credit
Agreement including as amended by the modifications and additional representations and warranties
of this Amendment, and of
14
each Loan Party in each of the other Loan Documents shall be true and accurate on and as of
the date hereof with the same effect as though such representations and warranties had been made on
and as of such date (except 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), and each of the Loan Parties shall have performed and complied
with all covenants and conditions hereof and thereof, no Event of Default or Potential Default
shall have occurred and be continuing or shall exist; and there shall be delivered to the
Administrative Agent for the benefit of each Bank a certificate of the Borrower dated the date
hereof and signed by the Chief Executive Officer, President, Treasurer or Chief Financial Officer
of the Borrower to each such effect.
(b) Secretary’s Certificate.
There shall be delivered to the Administrative Agent for the benefit of each Bank a
certificate dated the date hereof and signed by the Secretary or an Assistant Secretary of each of
the Loan Parties, certifying as appropriate as to:
(1) all action taken by each Loan Party in connection with this Amendment and the other
Loan Documents;
(2) the names of the officer or officers authorized to sign this Amendment and the
other Loan Documents and the true signatures of such officer or officers and specifying the
Authorized Officers permitted to act on behalf of each Loan Party for purposes of this
Amendment and the true signatures of such officers, on which the Administrative Agent and
each Bank may conclusively rely; and
(3) copies of its organizational documents, including its certificate of incorporation
and bylaws, certificate of limited partnership and limited partnership agreement or limited
liability company certificate and operating agreement, as the case may be, as in effect on
the date hereof and, in the case of the certificate of incorporation of the Borrower,
certified by the appropriate state official where such document is filed in a state office,
together with certificates from the appropriate state officials as to the continued
existence and good standing of the Borrower in the state of its formation and the state of
its principal place of business.
(c) Opinions of Counsel.
There shall be delivered to the Administrative Agent for the benefit of each Bank a written
opinion of Kirkpatrick & Lockhart Nicholson Graham LLP (who may rely on the opinions of such other
counsel as may be acceptable to the Administrative Agent) and a written opinion of Gregory A.
Billhartz, the Assistant General Counsel for the Loan Parties (who may rely on the opinions of such
other counsel as may be acceptable to the Administrative Agent), each dated the date hereof and in
form and substance satisfactory to the Administrative Agent and its counsel as to such matters
incident to the transactions contemplated herein as the Administrative Agent may reasonably
request.
(d) No Actions or Proceedings.
No action, proceeding, investigation, regulation or legislation shall have been instituted,
threatened or proposed before any court, governmental agency or legislative body to enjoin,
restrain or prohibit, or to obtain damages in respect of, this Amendment, the other Loan Documents
or the consummation of the transactions contemplated hereby or thereby or which, in the
Administrative Agent’s sole discretion, would make it inadvisable to consummate the transactions
contemplated by this Amendment or any of the other Loan Documents.
(e) Payment of Fees.
The Borrower shall pay or cause to be paid to the Administrative Agent for itself and for the
account of the Banks all fees as required by that certain fee letter dated May 23, 2006, between
the Administrative Agent and the Borrower, and all other fees, costs and expenses payable to the
Administrative Agent or any Bank or for which the
15
Administrative Agent or any Bank is entitled to be reimbursed, including but not limited to
the fees and expenses of the Administrative Agent’s legal counsel.
(f) Consents.
All material consents required to effectuate the transactions contemplated by this Amendment
and the other Loan Documents and shall have been obtained.
(g) Financial Projections.
There shall have been delivered to the Administrative Agent copies of the Updated Financial
Projections.
(h) Confirmation of Guaranty.
Each of the Guarantors shall have executed and delivered to the Administrative Agent the
Confirmation of Guaranty in substantially the form attached hereto as Exhibit A.
(i) Legal Details.
All legal details and proceedings in connection with the transactions contemplated by this
Amendment and the other Loan Documents shall be in form and substance satisfactory to the
Administrative Agent and counsel for the Administrative Agent, and the Administrative Agent shall
have received all such other counterpart originals or certified or other copies of such documents
and proceedings in connection with such transactions, in form and substance satisfactory to the
Administrative Agent and its counsel, as the Administrative Agent or its counsel may reasonably
request.
4. Consent.
By execution of this Amendment, each Agent and each Bank acknowledges that it has reviewed a
copy of the Credit Agreement, as amended hereby, and hereby acknowledges and confirms that the
February, 2006 Receivables Financing, as amended through the date hereof, is a Permitted
Receivables Financing and hereby consents to such February, 2006 Receivables Financing, as so
amended.
5. Force and Effect.
Except as otherwise expressly modified by this Amendment, the Credit Agreement and the other
Loan Documents are hereby ratified and confirmed and shall remain in full force and effect after
the date hereof.
6. Governing Law.
This Amendment shall be deemed to be a contract under the Laws of the Commonwealth of
Pennsylvania and for all purposes shall be governed by and construed and enforced in accordance
with the internal laws of the Commonwealth of Pennsylvania without regard to its conflict of laws
principles.
7. Effective Date; Certification of the Borrower.
This Amendment shall be dated as of and shall be binding, effective and enforceable upon the
date of (i) satisfaction of all conditions set forth in Section 3 hereof and (ii) receipt by the
Administrative Agent of duly executed original counterparts of this Amendment from the Borrower and
all Banks, and from and after such date this Amendment shall be binding upon the Borrower, each
Bank and the Agents, and their respective successors and assigns permitted by the Credit Agreement.
The Borrower by executing this Amendment, hereby certifies that this Amendment has been duly
executed and that as of the date hereof no Event of Default or Potential Default exists under the
Credit Agreement or the other Loan Documents.
16
8. No Novation.
This Amendment amends the Credit Agreement, but is not intended to constitute, and does not
constitute, a novation of the Obligations of the Loan Parties under the Credit Agreement or any
other Loan Document.
[Intentionally Blank]
17
[SIGNATURE PAGE 1 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have
executed this First Amendment to Credit Agreement as of the day and year first above written.
| ARCH COAL, INC. | ||||||
| By: | /s/ James E. Florczak | |||||
| Name: James E. Florczak Title: Treasurer |
||||||
[SIGNATURE PAGE 2 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| BANK LEUMI USA | ||||||
| By: | /s/ Joung Hee Hong | |||||
| Name: Joung Hee Hong Title: Vice President |
||||||
[SIGNATURE PAGE 3 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| BANK OF MONTREAL | ||||||
| By: | /s/ Bruce A. Pietka | |||||
| Name: Bruce A. Pietka Title: Vice President |
||||||
[SIGNATURE PAGE 4 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| CALYON NEW YORK BRANCH | ||||||
| By: | /s/ Lee Greve | |||||
| Name: Lee Greve Title: Managing Director |
||||||
| By: | /s/ Joe Philbin | |||||
| Name: Joe Philbin Title: Director |
||||||
[SIGNATURE PAGE 5 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| CITICORP USA, INC., individually and as Syndication Agent | ||||||
| By: | /s/ Daniel J. Miller | |||||
| Name: Daniel J. Miller Title: Vice President |
||||||
[SIGNATURE PAGE 6 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| COMMERCE BANK N.A. | ||||||
| By: | /s/ Douglas P. Best | |||||
| Name: Douglas P. Best Title: Vice President |
||||||
[SIGNATURE PAGE 7 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| BANK OF AMERICA, N.A. (as successor by merger to Fleet National Bank), individually and as Documentation Agent |
||||||
| By: | /s/ Robert D. Valbona | |||||
| Name: Robert D. Valbona Title: Managing Director |
||||||
[SIGNATURE PAGE 8 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| JPMORGAN CHASE BANK, N.A., individually and as Syndication Agent | ||||||
| By: | /s/ Stacey Haimes | |||||
| Name: Stacey Haimes Title: Vice President |
||||||
[SIGNATURE PAGE 9 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| LASALLE BANK NATIONAL ASSOCIATION | ||||||
| By: | /s/ Margaret C. Dierkes | |||||
| Name: Margaret C. Dierkes Title: Vice President |
||||||
[SIGNATURE PAGE 10 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| MIZUHO CORPORATE BANK, LTD. | ||||||
| By: | /s/ Raymond Ventura | |||||
| Name: Raymond Ventura Title: Deputy General Manager |
||||||
[SIGNATURE PAGE 11 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| MORGAN STANLEY BANK | ||||||
| By: | /s/ Daniel Twenge | |||||
| Name: Daniel Twenge Title: Vice President |
||||||
[SIGNATURE PAGE 12 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| NATEXIS BANQUES POPULAIRES | ||||||
| By: | /s/ Timothy L. Polvado | |||||
| Name: Timothy L. Polvado Title: Vice President and Group Manager |
||||||
| By: | /s/ Daniel Payer | |||||
| Name: Daniel Payer Title: Vice President |
||||||
[SIGNATURE PAGE 13 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| NATIONAL CITY BANK OF THE MIDWEST | ||||||
| By: | /s/ Eric Hartman | |||||
| Name: Eric Hartman Title: Vice President |
||||||
[SIGNATURE PAGE 14 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| PNC BANK, NATIONAL ASSOCIATION, individually and as Administrative Agent |
||||||
| By: | /s/ Richard C. Munsick | |||||
| Name: Richard C. Munsick Title: Senior Vice President |
||||||
[SIGNATURE PAGE 15 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| THE BANK OF NEW YORK | ||||||
| By: | /s/ Craig J. Anderson | |||||
| Name: Craig J. Anderson Title: Vice President |
||||||
[SIGNATURE PAGE 16 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| UBS LOAN FINANCE LLC | ||||||
| By: | /s/ Richard L. Tavrow | |||||
| Name: Richard L. Tavrow Title: Director |
||||||
| By: | /s/ Irja R. Otsa | |||||
| Name: Irja R. Otsa Title: Associate Director |
||||||
[SIGNATURE PAGE 17 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| UMB BANK, N.A. | ||||||
| By: | /s/ Cecil G. Wood | |||||
| Name: Cecil G. Wood Title: Executive Vice President |
||||||
[SIGNATURE PAGE 18 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| UNION BANK OF CALIFORNIA, N.A. | ||||||
| By: | /s/ Bryan Read | |||||
| Name: Bryan Read Title: Vice President |
||||||
[SIGNATURE PAGE 19 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| REGIONS BANK (Formerly Union Planters Bank, N.A.) |
||||||
| By: | /s/ Steven A. Linton | |||||
| Name: Steven A. Linton Title: Senior Vice President |
||||||
[SIGNATURE PAGE 20 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| US BANK NATIONAL ASSOCIATION | ||||||
| By: | /s/ Karen Meyer | |||||
| Name: Karen Meyer Title: Vice President |
||||||
[SIGNATURE PAGE 21 OF 21 TO FIRST AMENDMENT TO CREDIT AGREEMENT]
| WACHOVIA BANK,
NATIONAL ASSOCIATION, individually and as Syndication Agent |
||||||
| By: | /s/ William F. Fox | |||||
| Name: William F. Fox Title: Director |
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Exhibit 10.2
SECOND AMENDMENT TO
RECEIVABLES PURCHASE AGREEMENT
RECEIVABLES PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT (this “Amendment”), dated as
of June 23, 2006, is entered into among ARCH RECEIVABLE COMPANY, LLC (the “Seller”), ARCH
COAL SALES COMPANY, INC. (the “Servicer”), MARKET STREET FUNDING LLC (the
“Issuer”), the various financial institutions party to the Agreement (as defined below) as
LC Participants (the “LC Participants”), and PNC BANK, NATIONAL ASSOCIATION, as
Administrator (the “Administrator”) and as LC Bank (the “LC Bank”).
RECITALS
1. The parties hereto are parties to the Receivables Purchase Agreement, dated as of February
3, 2006 (as amended, amended and restated, supplemented or otherwise modified through the date
hereof, the “Agreement”); and
2. 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.
(a) The amount specified as the “Purchase Limit” in the definition of such term set
forth in Exhibit I to the Agreement is hereby amended by changing such amount from
“$100,000,000” to “150,000,000”.
(b) The Commitment of each of the Issuer and the LC Participant is hereby amended to be
the amount set forth as the “Commitment” under its name on its respective signature page to
this Amendment.
SECTION 3. Representations and Warranties. Each of the Seller and the Servicer hereby
represents and warrants to the Administrator and the Purchasers as follows:
(a) Representations and Warranties. The representations and warranties made by
it in the 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 corporate powers and have been duly
authorized by all necessary organizational 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. 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 “this
Agreement”, “hereof”, “herein” or
words of similar effect 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 set forth
herein.
SECTION 5. Effectiveness. This Amendment shall become effective as of the date hereof
upon receipt by the Administrator of (a) counterparts of this Amendment (whether by facsimile or
otherwise) executed by each of the parties hereto and (b) counterparts of that certain amended and
restated fee letter by and among the Seller, Issuer, Administrator and Arch Coal, Inc. and dated as
of the date hereof (whether by facsimile or otherwise), executed by each of the parties thereto,
and receipt by the Administrator of the full amount of the “Amendment Fee” referred to therein.
SECTION 6. 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.
SECTION 7. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the internal laws of the State of New York.
SECTION 8. 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.
[Signatures begin on next page]
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written
above.
| ARCH RECEIVABLE COMPANY, LLC, as Seller |
||||||
| By: | /s/ James E. Florczak | |||||
| Name: James E. Florczak Title: Vice President and Treasurer |
||||||
| ARCH COAL SALES COMPANY, LLC, as Servicer | ||||||
| By: | /s/ James E. Florczak | |||||
| Name: James E. Florczak Title: Vice President and Treasurer |
||||||
| MARKET STREET FUNDING LLC, as Issuer |
||||||
| By: | /s/ Doris J. Hearn | |||||
| Name: Doris J. Hearn Title: Vice President |
||||||
| Commitment: $150,000,000 | ||||||
| PNC BANK, NATIONAL ASSOCIATION, as Administrator |
||||||
| By: | /s/ John T. Smathers | |||||
| Name: John T. Smathers Title: Vice President |
||||||
| PNC BANK, NATIONAL ASSOCIATION, as the LC Bank and as an LC Participant |
||||||
| By: | /s/ Richard C. Munsick | |||||
| Name: Richard C. Munsick Title: Senior Vice President |
||||||
| Commitment: $150,000,000 Pro-Rata Share: 100% |
||||||