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
Date of Report (Date of earliest event reported): April 18, 2016
FORESIGHT ENERGY LP
(Exact name of registrant as specified in its charter)
Delaware
|
|
001-36503 |
|
80-0778894
|
(State or other jurisdiction
|
|
(Commission
|
|
(IRS Employer
|
211 North Broadway
Suite 2600
Saint Louis, MO 63102
(Address, including zip code, of principal executive offices)
Registrant’s telephone number, including area code: (314) 932-6160
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))
Item 1.01. Entry into a Material Definitive Agreement.
On April 18, 2016, Foresight Energy LLC (“ FELLC ”) and Foresight Energy LP (together with FELLC and certain subsidiaries of FELLC, the “ Partnership ”) entered into a Transaction Support Agreement (the “ Support Agreement ”), with certain of the lenders (the “ Consenting Lenders ”) under the Partnership’s Second Amended and Restated Credit Agreement dated as of August 23, 2013 (the “ Credit Agreement ”), pursuant to which the Consenting Lenders have agreed (subject to the terms and conditions set forth therein) to support a proposed global restructuring of the Partnership’s indebtedness (the “ Restructuring ”), including a proposed amendment and restatement (the “ Amendment ”) of the Credit Agreement.
Terms of the Support Agreement and the Proposed Amendment and Restatement of the Credit Agreement.
Pursuant to the Support Agreement (subject to the terms and conditions set forth therein):
|
· |
The parties have agreed to support and seek to consummate the Restructuring in a timely manner, including (subject to the negotiation of definitive terms and documentation) amending and restating the Credit Agreement to effect the following amendments set forth in the Amendment term sheet (the “ Amendment Term Sheet ”) (incorporated into the Support Agreement as Exhibit A thereto): (i) a $75 million reduction in aggregate lender commitments under the revolving credit facility (with an additional $25 million reduction to occur on December 31, 2016); (ii) a 1.00% increase in the interest rates applicable to borrowings under the Credit Agreement; (iii) the implementation of an “excess cash flow sweep” provision (to be applicable in the second half of 2016 and in 2017), requiring prepayment of the term loans thereunder with 50% of “excess cash flow” (to be defined in a manner consistent with the existing Credit Agreement definition, subject to any mutually agreed upon modifications); (iv) the amendment of the consolidated interest coverage ratio and senior secured leverage ratio financial covenants to make such covenants applicable to both the term loan facility and the revolving credit facility (instead of only the revolving credit facility); (v) the amendment of the senior secured leverage ratio applicable to the financial maintenance covenant to be as follows: (a) 3.8 to 1 through the end of 2016; (b) 4.0 to 1 during 2017; (c) 3.8 to 1 during 2018; (d) 3.5 to 1 during 2019; and (e) 3.25 to 1 during 2020; (vi) the prohibition of certain restricted payments in 2016, 2017 and the first six months of 2018 (or such later date as the revolving credit facility is refinanced) (subject to limited tax-related exceptions in 2017 and thereafter); (vii) the implementation of an “anti-hoarding” covenant, prohibiting borrowings under the revolving credit facility (other than letters of credit) when FELLC’s unrestricted cash exceeds $35 million; (viii) other amendments to the Credit Agreement for the purpose of implementing the other transactions contemplated in the proposed Restructuring; and (ix) other amendments to the covenants, representations and warranties, events of default and other provisions of the Credit Agreement described in the Amendment Term Sheet; |
|
· |
The Partnership has agreed with the Consenting Lenders that it will seek to enter into a transaction support agreement or similar agreement with holders of at least 66.67% of the principal amount of FELLC’s 7.875% Senior Notes due 2021 (the “ Notes ”) in support of the transactions contemplated in the proposed Restructuring on or before May 6, 2016; |
|
· |
The Consenting Lenders have agreed to a restriction on their right to transfer their claims under the Credit Agreement for so long as the Support Agreement is in effect unless the transferee agrees to be bound by the terms of the Support Agreement; |
|
· |
FELLC has agreed to pay each Consenting Lender (on the effective date of the proposed Amendment) an amendment fee in an aggregate amount (after giving effect to transactions contemplated in the proposed Restructuring) equal to 1.0% of the aggregate amount of revolving credit facility commitments of, and, without duplication, 1.0% of all loans, including term loans, owed to, such Consenting Lender under the Credit Agreement at such date (after giving effect to the revolving credit facility reduction); |
|
· |
The Consenting Lenders have agreed that as of the effective date of the Amendment of the Credit Agreement, the Consenting Lenders will waive defaults and events of default under the Credit Agreement specified in: (i) the Notice of Events of Default and Reservation of Rights dated December 9, 2015; (ii) the notice of payment default dated February 16, 2016; (iii) the Compliance Certificate dated March 23, 2016 for the period ending December 31, 2015; and (iv) any other defaults or events of default continuing immediately prior to the consummation of the transactions contemplated in the proposed Restructuring; and |
|
Agreement on or before July 15, 2016; or (c) failure to consummate the transactions contemplated by the Support Agreement by an outside date of November 4, 2016; (i i i) automatically after thre e business days upon (a) the commencement of an in voluntary bankruptcy proceeding against the Partnership; (b) the Partnership’s proposal or support of a proposal to pursue an alternative restructuring; (c) the Partnership failing to enter into a transacti on support agreement or similar agreement with holders of at least 66.67% of the principal amount of the Notes on or before May 6, 2016; (d) notice from the Administrative Agent regarding a payment default under the Credit Agreement; or (e) the termination or expiration of the forbearance agreement dated January 27, 2016 (as amended) relating to Foresight Receivables LLC’s receivables financing agreement or the termination or expiration of any other transaction support agreement or similar agreement entered into by the Partnership in supp ort of the Restructuring; or (iv ) upon three business days’ notice upon: (a) any deviation from the material terms of the transactions contemplated by the Support Agreement in any definitive document for the Restructuring th at is adverse to the Consenting Lenders or a material breach by the Partnership of the Support Agreement; (b) any material breach by the Partnership of its obligations under the Support Agreement that are not cured; (c) the termination or expiration of the forbearance agreement dated December 18, 2015 (as amended) with certain holders of the Notes; (d) the occurrence of an Event of Default under the Credit Agreement (other than a payment default or in respect of financial covenants); and ( e ) a final, non-ap pealable governmental or regulatory order materially preventing or prohibiting the transactions contemplated by the Support Agreement in a way that cannot be reasonably remedied by the parties. Certain of the foregoing termination events may be waived or modified by a majority of the Consenting Lenders; other termination events, including the outside date of November 4, 2016, may not be waived or modified without the consent of each Consenting Lender. |
Terms of the Proposed Restructuring.
The proposed Restructuring (of which the foregoing proposed Amendment forms a component) consists of a series of proposed transactions which are the subject of ongoing negotiations amongst the various stakeholders of the Partnership and its affiliates and which are set forth in the proposed Restructuring term sheet (the “ Restructuring Term Sheet ”) (incorporated into the Support Agreement as Exhibit B thereto), including (among other things) the following additional proposed transactions:
|
· |
The proposed purchase by investors in Foresight Reserves LP of up to $106 million aggregate principal amount of outstanding Notes currently held by non-affiliates of the Partnership, in a cash tender offer at a price equal to 100% of the principal amount thereof; |
|
· |
The proposed exchange (the “ Notes Exchange ”) of the outstanding Notes for: (i) up to $300 million aggregate principal amount of second-lien senior convertible PIK notes (with a term no greater than one year and a 15.0% per annum PIK coupon); and (ii) up to $300 million aggregate principal amount of second-lien senior secured notes due August 2021 (with a a 9.0% per annum cash coupon for the first two years, a 10.0% per annum cash coupon thereafter plus an additional 1.0% per annum PIK coupon), of which approximately $180 million in aggregate principal amount would be issued to the Partnership’s principal equityholders in exchange for Notes held (or purchased from other holders of the Notes in the tender offer described above) by such equityholders; with each such class of proposed new notes to have covenants and events of default substantially similar to the Notes (subject to revisions to implement the second-lien nature of such notes). The second-lien senior convertible PIK notes, if not redeemed under the circumstances described in the Restructuring Term Sheet by their maturity date, will convert into 75% of the fully diluted equity of the Partnership (in the form of common units). If the second-lien senior convertible PIK notes are redeemed under the circumstances described in the Restructuring Term Sheet by their maturity date, the Partnership will issue warrants to purchase up to 7.5% of the Company’s common equity (in the form of common units). Additional proposed terms of the second-lien senior convertible PIK notes and second-lien senior secured notes due 2021 are described in the Restructuring Term Sheet; |
|
· |
Certain proposed amendments and waivers to Foresight Receivables LLC’s receivables financing agreement to (among other things) address existing defaults; |
|
· |
The proposed execution of a new intercreditor agreement among the first-lien creditors and the proposed new second-lien creditors; |
|
· |
The proposed execution of one or more release agreements among the Partnership, its principal equityholders and holders of the Notes; |
|
· |
Proposed modifications or amendments to the Partnership’s other operational or financing documents, including equipment financings, as may be necessary to address existing defaults and/or events of default and permit the other proposed Restructuring transactions. |
The foregoing descriptions of the Support Agreement, the Amendment Term Sheet and the Restructuring Term Sheet are qualified in their entirety by reference to the full text of the Support Agreement (including the Amendment Term Sheet and the Restructuring Term Sheet, which are included as Exhibits A and B thereto, respectively), filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference herein.
The negotiations between the Partnership and its affiliates and the creditors, equityholders and other stakeholders of the Partnership concerning the terms of the proposed Restructuring transactions are ongoing and are not finalized. Accordingly:
|
· |
The holders of the Notes are not party to the Support Agreement and have not approved nor agreed (either implicitly or explicitly) to the terms of the proposed Notes Exchange contemplated as part of the proposed Restructuring, nor have they agreed to the terms of any other proposed Restructuring transactions, nor are they bound to take (or refrain from taking) any actions as a result of the effectiveness of the Support Agreement; |
|
· |
The equityholders of the Partnership are not party to the Support Agreement. While the principal equityholders of the Partnership support the transactions contemplated by the Restructuring Term Sheet, certain key terms remain subject to further negotiation and are not yet agreed upon. The equityholders of the Partnership are not bound to take (or refrain from taking) any actions as a result of the effectiveness of the Support Agreement; and |
|
· |
The other creditors and stakeholders of the Partnership and its affiliates who are not party to the Support Agreement have not approved nor agreed (either implicitly or explicitly) to the terms of the Support Agreement, the Amendment Term Sheet, the Restructuring Term Sheet or the Restructuring transactions contemplated thereby, nor are they bound to take (or refrain from taking) any actions as a result of the effectiveness of the Support Agreement. |
There can be no assurances that any of the foregoing parties to whom such Restructuring transactions have been proposed will agree to the terms of any such transactions in accordance with the terms described herein, if at all.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Certain statements and information in this Current Report on Form 8-K may constitute “forward-looking statements.” The words “propose,” “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “outlook,” “estimate,” “potential,” “continues,” “may,” “will,” “seek,” “approximately,” “predict,” “anticipate,” “should,” “would,” “could” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that the future developments affecting us will be those that we anticipate. All comments concerning the proposed Restructuring described herein are based on the current state of the ongoing related negotiations.
The successful consummation of the transactions contemplated by the Support Agreement, which are currently being negotiated with various stakeholders as part of the proposed Restructuring, are subject to various conditions, including the successful negotiation of definitive documentation and other conditions that are not within the control of the Partnership or its affiliates. There can be no assurances that the Partnership or any of its affiliates will be able to successfully negotiate or implement any of the proposed Restructuring transactions contemplated by the Support Agreement, or if they are able to do so, that such negotiation or implementation will be consistent with the terms described herein.
We continue to experience substantial financial, business, operational and reputational risks that threaten our ability to continue as a going concern and could materially affect our present expectations and projections. For additional information regarding known material factors that could cause our actual results to differ from those contained in or implied by
forward-looking statements, please see the section entitled “Risk Factors ” in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the Securities and Exchange Commission on March 15, 2016.
You are cautioned not to place undue reliance on forward-looking statements, which are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except as required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
|
Exhibit Description |
|
|
|
10.1 |
|
Transaction Support Agreement, dated as of April 18, 2016, by and among Foresight Energy LLC, certain of its subsidiaries, Foresight Energy LP and the banks and financial institutions from time to time party thereto. |
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.
Foresight Energy LP |
By: Foresight Energy GP LLC, its general partner |
|
By: /s/ Robert D. Moore |
Robert D. Moore President and Chief Executive Officer |
|
Date: April 18, 2016
|
EXHIBIT INDEX
Exhibit No. |
|
Exhibit Description |
|
|
|
10.1 |
|
Transaction Support Agreement, dated as of April 18, 2016, by and among Foresight Energy LLC, certain of its subsidiaries, Foresight Energy LP and the banks and financial institutions from time to time party thereto. |
Exhibit 10.1
EXECUTION VERSION
TRANSACTION SUPPORT AGREEMENT
This TRANSACTION SUPPORT AGREEMENT (as amended from time to time, this “ Agreement ”) is made and entered into as of April 18, 2016 by and among (i) Foresight Energy LLC, a Delaware limited liability company (“ Borrower ”), certain subsidiaries of Borrower, and Foresight Energy LP, a Delaware limited partnership (collectively, the “ Partnership ”) and (ii) each of the banks and financial institutions from time to time party hereto (each a “ Consenting Lender ”, collectively, the “ Consenting Lenders ”). The Partnership and the Consenting Lenders shall each be referred to as a “ Party ” and collectively as the “ Parties .”
Except as otherwise set forth herein, each capitalized term used but not otherwise defined herein shall have the meaning ascribed to such term in the term sheet titled “ Foresight Energy LLC Third Amended and Restated Credit Agreement Summary of Principal Terms and Conditions ”, attached hereto as Exhibit A , which term sheet and all exhibits, schedules and annexes thereto are expressly incorporated by reference herein and made a part of this Agreement as if fully set forth herein (as may be amended, supplemented or modified from time to time in accordance with the terms hereof, the “ Amendment Term Sheet ”).
RECITALS
WHEREAS , the Borrower entered into that certain Second Amended and Restated Credit Agreement dated as of August 12, 2010 and amended and restated as of August 23, 2013, with Citibank, N.A. (the “ Administrative Agent ”), the lenders party thereto (the “ Lenders ”) and the guarantors party thereto (as amended, the “ Credit Agreement ”, and loans and commitments under such Credit Agreement, the “ Debt ”, and claims related to such Debt, collectively, the “ Debt Claims ”, it being understood that Secured Cash Management Agreements (as that term is defined in the Credit Agreement) shall not constitute Debt Claims for purposes of this Agreement);
WHEREAS , the Borrower and Foresight Energy Finance Corporation (collectively, the “ Issuers ”) are party to that certain Indenture, dated as of August 23, 2013, with Wilmington Savings Fund Society, FSB (the “ Trustee ”), the holders thereunder (the “ Noteholders ”) and the guarantors party thereto (as amended, the “ Notes Indenture ”, and such notes issued under such Notes Indenture, the “ Notes ” and claims related to such Notes, collectively, the “ Note Claims ”);
WHEREAS , the Consenting Lenders, the Partnership, certain Noteholders and certain other parties in interest (collectively, the “ Transaction Parties ”) have engaged in arm’s-length, good faith discussions regarding a restructuring of the Partnership’s indebtedness and other obligations, including the Partnership’s indebtedness and obligations under the Notes Indenture and the Credit Agreement; and
WHEREAS , each Party desires to amend and restate the Credit Agreement (the “ Amendment ”) on the terms set forth in the Amendment Term Sheet and enter into the various agreements and transactions in furtherance of a global restructuring of the Partnership’s indebtedness (the “ Transaction ”), substantially on the terms set forth in the term sheet, attached
hereto as Exhibit B , which term sheet and all exhibits, schedules and annexes thereto are expressly incorporated by reference herein and made a part of this Agreement as if fully set forth herein ( as may be amended , supplemented or modifi ed from time to time in accordance with this Agreement , the “ Transaction Term Sheet ” and, together with the Amendment Term Sheet , the “ Term Sheets ” ).
NOW, THEREFORE , in consideration of the covenants and agreements contained herein, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Party, intending to be legally bound hereby, agrees as follows:
AGREEMENT
1. Commitment of the Partnership.
Subject to the Partnership’s fiduciary duties under applicable law and governing documents, as of the TSA Effective Date (as defined below), and for so long as the Termination Date (as defined below) has not occurred, the Partnership agrees to:
|
a. |
support the Transaction, including the Amendment, as contemplated under this Agreement and the Term Sheets; |
|
b. |
implement and consummate the Transaction, including the Amendment, in a timely manner and take any and all commercially reasonable and appropriate actions in furtherance of the Transaction and the Amendment as contemplated under this Agreement and the Term Sheets; |
|
c. |
negotiate in good faith with the Consenting Lenders the Amendment and other definitive documents that are contemplated in the Amendment Term Sheet and/or that are necessary or desirable for the consummation of the Amendment (collectively, the “ Definitive Documents ”), which shall contain provisions that are consistent with this Agreement, the Term Sheets, and such other provisions as are agreed to by the Required Lenders (as that term is defined in the Credit Agreement) and the Partnership (it being understood and agreed that any terms therefore contained in the Amendment Term Sheet shall be deemed to be so acceptable); |
2
|
are consistent with th e Term Sheet s and shall otherwise be reasonably satisfactory to the Required Lenders (as that term is defined in the Credit Agreement) to the extent such documents directly impact the Consenting Lenders ; |
|
e. |
obtain any and all required regulatory and third-party approvals for the Transaction, including the Amendment; |
|
f. |
not directly or indirectly (i) seek, solicit, support, encourage, propose, assist, consent to, or participate in any discussions regarding the negotiation or formulation of any proposal, offer, dissolution, winding up, liquidation, reorganization, merger, consolidation, business combination, joint venture, partnership, sale of assets, or restructuring of the Partnership other than the Transaction (including the Amendment) (each, an “ Alternative Proposal ”), (ii) publicly announce its intention not to pursue the Transaction and/or the Amendment or (iii) take any other action that is inconsistent with, or that would reasonably be expected to prevent, interfere with or delay the proposal, solicitation, confirmation, or consummation of the Transaction and/or the Amendment; |
|
g. |
take no actions inconsistent with this Agreement or the Term Sheets; |
|
h. |
at the request of any Consenting Lender, promptly deliver to such Lender a list of all Consenting Lenders and appropriate contact information for such Consenting Lenders; and |
|
i. |
provide the Consenting Lenders or their professional advisors with reasonable access to management upon reasonable notice and keep the Consenting Lenders reasonably apprised of any material adverse developments regarding the Partnership’s business operations. |
2. Commitment of Consenting Lenders.
As of the TSA Effective Date, and for so long as the Termination Date has not occurred, each Consenting Lender (severally and not jointly) agrees to:
|
a. |
support the Transaction, including the Amendment, as contemplated under this Agreement and the Term Sheets; |
|
b. |
implement and consummate the Transaction, including the Amendment, in a timely manner and take any and all commercially reasonable and appropriate actions in furtherance of the Transaction and the Amendment as contemplated under this Agreement and the Term Sheets; provided , however , that such actions shall be limited to review and negotiation of the applicable Definitive Documents and execution of the same; |
3
|
Amendment or the Definitive Documents, and not exercise or seek to exercise any rights (including rights of acceleration or payment) or remedies or assert or bring any claims under or with respect to the Debt or the Credit Agreement against the Partnership that is inconsistent with this Agreement or the Term Sheet s ; |
|
d. |
negotiate in good faith with (i) the Partnership and, as necessary, the other Transaction Parties the Amendment and the Definitive Documents (each of which shall be consistent in all material respects with this Agreement or the Amendment Term Sheet, as applicable, or otherwise in form and substance reasonably acceptable to the Partnership and the Required Lenders (as that term is defined in the Credit Agreement) (it being understood and agreed that any terms therefor contained in the Amendment Term Sheet shall be deemed to be acceptable) and (ii) if required by any such Consenting Lender, any third parties and/or contract counterparties (in each case unaffiliated with the Consenting Lenders) as may be necessary or appropriate under the circumstances in furtherance of the Transaction; and |
provided that except as expressly provided herein, this Agreement and all communications and negotiations among the Transaction Parties with respect hereto or any of the transactions contemplated hereunder are without waiver or prejudice to such Parties’ rights and remedies and the Parties hereby expressly reserve all claims, defenses and positions that they may have with respect to each other; and provided further that, except as otherwise expressly set forth in this Agreement, the foregoing provisions will not limit the rights of any Party to appear and participate as a party in interest in any matter to be adjudicated in any case under the Bankruptcy Code (or otherwise) concerning the Partnership. For the avoidance of doubt, each Consenting Lender agrees to support the Transaction, including the Amendment, as set forth herein solely in its capacity as a Lender under the Credit Agreement and not in any other capacity, including as a provider of treasury services to the Partnership or a lender or contract counterparty under any of the Partnership’s other financing or contractual arrangements, and references to Debt Claims herein shall not be deemed to include claims arising in such other capacities.
3. Representations and Warranties.
|
a. |
Representations and Warranties of Consenting Lenders . Each Consenting Lender identified on the signature pages hereto as a holder of Debt, represents and |
4
|
warrants on a several (but not joint) basis to the Partnership , that the following are true, correct, and complete as of the TSA Effective Date (or such later date on which a Consenting Lender becomes a party to this Agreement by executing and delivering a Joinder Agreement (as defined below)) : |
|
i. |
Organization; Authority . Such Consenting Lender, if an entity, is duly organized, validly existing and in good standing under the laws of its jurisdiction of formation or incorporation. Such Consenting Lender has all requisite power and authority to execute and deliver this Agreement and to carry out the transactions contemplated by, and perform its obligations under, this Agreement. |
|
ii. |
Binding Obligation . This Agreement constitutes the legally valid and binding obligation of such Consenting Lender, enforceable against it in accordance with its terms. |
|
iii. |
No Other Representations ; No Reliance . Except for (a) the representations and warranties made by the Partnership in this Agreement, (b) the representations and warranties made in the Credit Agreement as of the date thereof (as such representations and warranties are modified or supplemented by that certain compliance certificate dated March 23, 2016), and (c) the good faith statements and representations made by the Partnership in materials posted to the Lenders in connection with negotiation of the Transaction and the Amendment, no party has made to such Consenting Lender any express or implied representation or warranty with respect to the Partnership or its subsidiaries or their respective businesses, operations, assets, liabilities, conditions (financial or otherwise) or prospects, and such Consenting Lender hereby disclaims any such other representations or warranties. Subject to the foregoing exceptions, such Consenting Lender is not relying upon any warranty or representation by, or information from, the Partnership of any sort, oral or written, except the warranties and representations expressly set forth in this Agreement. In particular, and without limiting the generality of the foregoing, such Consenting Lender acknowledges that no representation and warranty is made hereunder with respect to any financial projection. |
5
|
page and to dispose of, exchange, assign, and transfer such Debt and, if applicable, such other interests in the Partnership, including the power and authority to execute and deliver this Agreement and to perform its obligations hereunder. |
|
i. |
Indebtedness. As of April 14, 2016, the aggregate outstanding indebtedness (x) under the Credit Agreement is $656.8 million, comprised of $352.5 million of borrowings under the revolving credit facility, $297.8 million of principal amount of term loans, and $6.5 million in letters of credit, (y) under the Notes Indenture is $600 million, and (z) under the A/R Securitization is $20.0 million, and such amounts (together with accrued interest and fees thereon) are outstanding and justly and truly owing by the Borrower without defense, offset or counterclaim. |
|
ii. |
Financial Condition. The financial condition of the Partnership has not materially and adversely changed from that set forth in the Form 10-K for the year ended December 31, 2015. |
|
iii. |
Organization; Authority . The Partnership is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation. The Partnership has all requisite power and authority to, and all necessary action on such entity’s part has been taken to authorize it to, execute and deliver this Agreement and to carry out the transactions contemplated by, and perform its obligations under, this Agreement. |
|
iv. |
Binding Obligation . This Agreement is the legally valid and binding obligation of the Partnership and is enforceable against the Partnership in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, or other similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability. |
|
v. |
Governmental Consents . Except as expressly provided in this Agreement, the execution, delivery, and performance by it of this Agreement do not and shall not require any registration or filing with, consent or approval of, or notice to, or other action to, with or by, any federal, state, or other governmental authority or regulatory body other than the Securities Exchange Commission. |
|
vi. |
Review; Fiduciary Duties . The Partnership acknowledges that it has reviewed this Agreement and has decided to enter into this Agreement on the terms and conditions set forth in the exercise of its fiduciary duties. |
6
4. Covenants of the Parties.
|
a. |
Subject to the terms and conditions hereof, as of the TSA Effective Date and for so long as the Termination Date has not occurred, and unless compliance is waived in writing by the Required Consenting Lenders (as defined herein), the Partnership agrees as follows: |
|
i. |
it shall use its commercially reasonable efforts to (A) complete and satisfy the conditions necessary to consummate the Transaction, including the Amendment, as contemplated under this Agreement within the timeframes contemplated under Section 7 herein; and (B) take any and all necessary and appropriate actions in furtherance of the Transaction and the Amendment as contemplated under the Term Sheet; |
|
ii. |
it shall cooperate fully with the Consenting Lenders and their respective advisors and shall promptly provide updates to such parties (and promptly respond to any written or oral requests) regarding (A) any potential bankruptcy proceeding to be commenced by the Partnership (including but not limited to issues related to valuation of the Partnership or its assets, asset disposition, bankruptcy-related costs and expenses and creditor recoveries); (B) any contingency planning or any other material actions to be taken by or agreements to be entered into by the Partnership; and (C) any discussions or negotiations regarding any of the foregoing; |
|
iii. |
it shall enter into a transaction support agreement or similar agreement substantially in the form of this Agreement in support of the Transaction on or before May 6, 2016 with Noteholders holding at least 66.67% of the principal amount of the Notes; |
|
iv. |
subject to the Partnership’s fiduciary duties under applicable law and governing documents, it shall take no actions inconsistent with this Agreement or the Term Sheets; and |
7
|
Consenting Lenders (under a reasonably acceptable confidentiality agreement) the information contemplated herein . |
|
b. |
Subject to the terms and conditions hereof, as of the TSA Effective Date and for so long as the Termination Date has not occurred, and unless compliance is waived in writing by the Partnership, each Consenting Lender (severally and not jointly) agrees as follows: |
|
i. |
it shall use its commercially reasonable efforts to (A) support, complete, and satisfy the conditions necessary to consummate the Transaction and the Amendment as contemplated under this Agreement and the Term Sheets within the timeframes contemplated under Section 7 ; (B) take any and all necessary and appropriate actions in furtherance of the Transaction and the Amendment as contemplated under the Term Sheets; and (C) to the extent required by such Consenting Lender, obtain, file, submit or register any and all required regulatory and/or third-party filings, approvals, registrations or notices that are necessary or advisable to implement and consummate the Transaction and the Amendment; |
|
ii. |
it shall take no actions inconsistent with this Agreement or the Term Sheets; and |
|
iii. |
it shall execute and deliver the Definitive Documents to which it is to be a party, consummate the Amendment contemplated thereby and perform its obligations thereunder. |
5. Transfer of Debt or Other Interests in the Partnership.
As of the TSA Effective Date and until and unless the Termination Date has occurred, no Consenting Lender shall assign or otherwise transfer (“ Transfer ”) any Debt Claims or other rights and obligations under the Credit Agreement (including all or a portion of its commitments and the loans at the time owing to it), and any purported Transfer shall be null and void and without effect, unless the transferee is a Party to this Agreement or has executed a Joinder Agreement, the form of which is attached hereto as Exhibit C , prior to the time any such Transfer is effective and delivered a copy thereof to the Partnership in accordance with the notice provisions set forth herein. Any Transfer that does not comply with the foregoing shall be deemed void ab initio and each Party hereto shall have the right to enforce the voiding of such Transfer. Any Consenting Lender that effectuates a Transfer in compliance with the terms hereof shall have no liability under this Agreement arising from or related to the failure of the transferee to comply with the terms of this Agreement. This Agreement shall in no way be construed to preclude any Consenting Lender from acquiring additional Debt or other claims against or interests in the Partnership; provided that any such additional Debt shall, upon acquisition, automatically be deemed to be subject to all the terms of this Agreement.
Notwithstanding anything to the contrary set forth in this Section 5 , (i) the foregoing provisions shall not preclude any Consenting Lender from settling or delivering any Debt Claims to settle any confirmed transaction pending as of the date of such Consenting Lender’s entry into
8
this Agreement (subject to compliance with applicable securities laws and it being understood that such Debt Claims so acquired and held shall be subject to the terms of this Agreement), (ii) a Qualified Marketmaker that acquires any Debt Claims from a Consenting Lender with the purpose and intent of acting as a Qualified Marketmaker for such Debt Claims shall not be required to execute and deliver to counsel a Joinder Agreement or otherwise agree to be bound by the terms and conditions set forth in this Agreement if such Qualified Marketmaker transfers such Debt Claims (by purchase, sale, assignment, participation, or otherwise) within five (5) business days of its acquisition to a Consenting Lender or permitted transferee and the T ransfer otherwise is a permitted Transfer , including that such transferee delivers an executed Joinder Agreement to the Partnership no later than two (2) business days after consummation of the Transfer ; and (iii) to the extent any Party is acting solely in its capacity as a Qualified Marketmaker, it may Transfer any ownership interests in the Debt Claims that it acquires from a Lender that is not or has not been a Consenting Lender to a transferee that is not a Consenting Lender at the time of such Transfer without the requirement that the transferee be or become a signatory to this Agreement or execute a Joinder Agreement.
As used herein, “Qualified Marketmaker” means an entity that (a) holds itself out to the public or the applicable private markets as standing ready in the ordinary course of business to purchase from customers and sell to customers claims against the Partnership (or enter with customers into long and short positions in claims against the Partnership), in its capacity as a dealer or market maker in claims against the Partnership and (b) is, in fact, regularly in the business of making a market in claims against issuers or borrowers (including debt securities or other debt).
On the effective date of the Amendment, Borrower shall pay an amendment fee to each Consenting Lender that has executed this Agreement and the Amendment in an aggregate amount equal to (i) 1.00% of such Consenting Lender’s Revolving Credit Commitment (as that term is defined in the Credit Agreement) after giving effect to the reduction of such commitment as contemplated in the Amendment Term Sheet and, without duplication, (ii) 1.00% of all Revolving Loans, Term Loans, Swing Line Loans and L/C Obligations (as each term as defined in the Credit Agreement) owed to such Consenting Lender after giving effect to the modifications contemplated in the Amendment Term Sheet.
7. Termination.
This Agreement shall terminate (a) at any time by the mutual written consent of the Partnership and the Required Consenting Lenders, (b) automatically upon the occurrence of the event set forth in (iv) hereof, unless waived or otherwise agreed to by the Required Consenting Lenders, (c) automatically upon the occurrence of the event set forth in (iii) hereof, unless waived or otherwise agreed to by Required Consenting Lenders constituting Required Lenders (as that term is defined in the Credit Agreement), (d) automatically upon the occurrence of any of the events set forth in (i), (ii), (v) or (xv) hereof, unless waived or otherwise agreed to by each Consenting Lender, (e) automatically, three (3) business days’ after the occurrence of any of the events set forth in (vi) – (ix) hereof, unless waived or otherwise agreed to by the Required Consenting Lenders, and (f) by the Partnership or the Required Consenting Lenders, as
9
applicable, upon three (3) business days’ written notice delivered in accordance herewith of the occurrence of an event set forth in ( x ) – (xi v ) hereof , unless subsequently waived or otherwise agreed to by the Partnership or the Required Consenting Lenders , as applicable (each of the following events , a “ Termination Event ”):
Automatic Termination - Immediate.
|
i. |
the Partnership consents to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Partnership or any substantial part of the property of the Partnership; |
|
ii. |
the Partnership commences a voluntary case filed under the Bankruptcy Code; |
|
iii. |
the Partnership fails to consummate the Transaction, including the Amendment, on or before July 15, 2016; |
|
iv. |
the Transaction is consummated on the effective date thereof; |
Automatic Termination – After Three Business Days.
|
v. |
the commencement of an involuntary case against the Partnership under the Bankruptcy Code (as defined below); |
|
vi. |
the Partnership receives written notice from the Administrative Agent of the occurrence of any Event of Default pursuant to section 8.01(a) of the Credit Agreement; |
|
viii. |
the Partnership fails to enter into a transaction support agreement or similar agreement substantially in the form of this Agreement with Noteholders holding at least 66.67% of the principal amount of the Notes in support of the Transaction on or before May 6, 2016; |
|
ix. |
(x) the forbearance agreement dated January 27, 2016 (as amended, extended or otherwise modified from time to time) with certain lenders (the “ Consenting A/R Lenders ”) in respect of the A/R Securitization is terminated or is otherwise no longer in effect or (y) any other transaction support agreement or similar agreement entered into by the Partnership and any of the other Transaction Parties (other than the Lenders) in support of the Transaction terminates or is otherwise no longer in effect; |
Termination Upon Three Business Days’ Notice.
10
|
xii. |
the forbearance agreement dated December 18, 2015 (as amended, extended or otherwise modified from time to time) with certain Noteholders in respect of the Notes Indenture is terminated or is otherwise no longer in effect; |
|
xiii. |
the occurrence of any Event of Default under section 8.01 of the Credit Agreement after the TSA Effective Date based on events occurring after the TSA Effective Date (but excluding section 8.01(a) thereof and any Event of Default in respect of financial covenants as set forth in section 7.11 thereof); |
|
xiv. |
the Partnership or the Required Consenting Lenders deliver written notice of termination following any court of competent jurisdiction or other competent governmental or regulatory authority issuing a final, nonappealable order making illegal or otherwise restricting, preventing, or prohibiting the Transaction in a material way that cannot be reasonably remedied by the Parties; provided , that in no case shall the Partnership or the Required Consenting Lenders be entitled to terminate this Agreement pursuant to this Section 7 (xiv) if (A) such Party’s failure to comply with this Agreement was the primary reason that such order was entered or such restriction, prevention, or prohibition imposed or (B) such Party requested or commenced the action that led to such order; and |
Outside Date.
|
xv. |
the Partnership fails to consummate the Transaction, including the Amendment, on or before November 4, 2016. |
The date on which the Agreement terminates shall be referred to as the “ Termination Date ” and the provisions of this Agreement and the Term Sheets shall terminate on the Termination Date, except as otherwise provided in this Agreement, unless, prior to the Termination Date, the Termination Event is waived, amended or modified in writing on the terms set forth in this Section 7 . The first paragraph of this Section 7 and clause (xv) of this Section 7 shall not be amended without the consent of each Consenting Lender.
Upon the Termination Date, (i) this Agreement shall forthwith become void and of no further force or effect, (ii) each Party shall (except as otherwise expressly provided in this
11
Agreement) be immediately be released from its commitments, obligations, undertakings, and agreements under or related to this Agreement, (iii) there shall be no liability or obligation on the part of any Party under this Agreement , and (iv) each Party shall have all the rights and remedies that it would have had and shall be entitled to take all actions that it would have been entitled to take had it not entered this Agreement ; provided that in no event shall any such termination relieve a Party from (A) liability for its breach or non-performance of its obligations hereunder prior to the date of such termination and (B) obligations under this Agreement which by their terms expressly survive termination of the Agreement.
It is understood and agreed by the Parties that money damages would be an insufficient remedy for any breach of this Agreement by any Party and each non-breaching Party shall be entitled to specific performance and injunctive or other equitable relief, including attorneys’ fees and costs, as a remedy of any such breach without the necessity of proving the inadequacy of money damages as a remedy, in addition to any other remedy to which such non-breaching Party may be entitled at law or in equity; provided , however , that each Party agrees to waive any requirement for the securing or posting of a bond in connection with such remedy; and provided , further , that other than with respect to the remedy of specific performance, the liability of each Consenting Lender hereunder is subject to section 10.04 of the Credit Agreement.
9. Relationship Among Parties.
Notwithstanding anything herein to the contrary, the duties and obligations of the Parties under this Agreement shall be several and not joint. It is understood and agreed that any Consenting Lender may trade in the Debt Claims or other debt or equity securities of the Partnership without the consent of the Partnership, subject to applicable securities laws and Section 5 hereof. No Party hereto shall have any responsibility with respect to the Transfer of any of the Debt by any other entity by virtue of this Agreement. No prior history, pattern or practice of sharing confidences among or between the Parties shall in any way affect or negate this understanding and agreement. The Consenting Lenders hereby represent and warrant that they have no agreement, arrangement or understanding with respect to acting together for the purpose of acquiring, holding, voting or disposing of any equity securities of the Partnership and do not constitute a “group” within the meaning of Rule 13d-5 under the Securities Exchange Act of 1934, as amended. No action taken by a Consenting Lender pursuant to this Agreement shall be deemed to constitute or to create a presumption by any of the Parties that the Consenting Lenders are in any way acting in concert or as such a “group”. For the avoidance of doubt, the execution of this Agreement by any Consenting Lender shall not create, or be deemed to create, any fiduciary or other duties (actual or implied) to any other Consenting Lender other than as expressly set forth in this Agreement.
10. Entire Agreement; Prior Negotiations.
This Agreement, including the Term Sheets, constitutes the entire agreement of the Parties and supersedes all prior agreements (oral or written), negotiations, and documents reflecting such prior negotiations between and among the Parties (and their respective advisors),
12
with respect to the subject matter hereof , except for any confidentiality agreements heretofore executed between or among any of the Parties , which shall continue in full force and effect .
In the event of any conflict among the terms and provisions of (i) either of the Term Sheets and (ii) this Agreement, the terms and provisions of the applicable Term Sheet shall control. In the event of any conflict among the terms and provisions of (i) the Amendment Term Sheet and (ii) the Transaction Term Sheet, the terms and provisions of the Amendment Term Sheet shall control. Notwithstanding the foregoing, nothing contained in this Section 11 shall affect, in any way, the requirements set forth herein for the amendment of this Agreement.
12. Survival.
Notwithstanding the termination of this Agreement pursuant to Section 7 hereof, the acknowledgements, agreements and obligations of the Parties in this Section 12 and Sections 9 and 22 hereof (and any defined terms used in any such Sections), and the proviso in the last paragraph of Section 7, shall survive such termination and shall continue in full force and effect in accordance with the terms hereof.
13. Amendments and Waivers.
|
a. |
Except as otherwise provided herein, this Agreement (but not the Term Sheets) may not be modified, amended, supplemented or waived without the prior written consent of the Partnership and the Required Consenting Lenders. As used in this Agreement, “Required Consenting Lenders” means the Consenting Lenders holding more than 50% in aggregate outstanding principal amount of the Debt Claims that are held by all Consenting Lenders (excluding any Consenting Lenders who may be affiliates of the Partnership) as of the date of determination. No course of dealing between or among the Parties shall be deemed effective to modify, amend, or discharge any part of this Agreement or any rights or obligations of any such Party or such holder under or by reason of this Agreement. In determining whether any consent or approval has been given or obtained by the Required Consenting Lenders, the Debt held by any Consenting Lenders that is, at the time of determination, in material breach of its covenants, obligations or representations under this Agreement shall be excluded from such determination. |
|
b. |
No amendment, modification or supplement to (i) the Amendment Term Sheet or (ii) this Section 13(b) shall be effective without the prior written consent of Consenting Lenders constituting “Required Lenders”, “Required Revolving Lenders” and “each Lender”, as applicable, as each of those terms is defined in the Credit Agreement and as proscribed by section 10.01 of the Credit Agreement. |
13
|
Agreement; provided , however , that upon execution of a transaction support agreement or similar agreement with Noteholders holding at least 66.67% of the principal amount of the Notes , the Partnership may replace the Transaction Term Sheet attached hereto as Exhibit B with a long-form term sheet documenting the terms set forth therein without the consent of the “ Required Lenders ”, unless such term sheet includes modification s , amendment s or supplement s that are materially inconsistent with the Transaction Term Sheet annexed hereto in a manner that is adverse to the Lenders. |
14. Independent Analysis.
Each Consenting Lender hereby confirms that it has made its own decision to execute this Agreement based upon its own independent assessment of documents and information available to it, as it deemed appropriate.
15. Cooperation; Further Assurances.
The Parties shall cooperate with each other in good faith and shall coordinate their activities with each other (to the extent practicable and subject to the terms hereof) in respect of (a) all matters concerning the drafting and execution of the Definitive Documents and the implementation of the Transaction and the Amendment, and (b) the pursuit and support of the Transaction and the Amendment. The Parties agree to execute and deliver such other instruments and perform such acts, in addition to the matters herein specified, as may be reasonably appropriate or necessary, from time to time, to effectuate the agreements and understandings of the Parties, whether the same occurs before or after the date of this Agreement.
16. GOVERNING LAW . THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401), WITHOUT REGARD TO ANY CONFLICTS OF LAW PROVISIONS WHICH WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.
17. WAIVER OF JURY TRIAL . EACH PARTY HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
18. Consent to Jurisdiction .
Each of the Parties hereby irrevocably and unconditionally submits to the non-exclusive jurisdiction of (a) the Delaware Court of Chancery (and any state appellate court therefrom within the State of Delaware), the United States District Court for the District of Delaware and any appellate court from any thereof or, if either such court declines to accept jurisdiction over a particular matter, any other state or federal court in Delaware generally, or (b) the United States District Court for the Southern District of New York and any appellate court from any thereof or,
14
if either such court declines to accept jurisdiction over a particular matter, any other state or federal court in New York generally , in any action or proceeding arising out of or relating to this Agreement or the Credit Agreement , or for recognition or enforcement of any judgment arising therefrom, and further irrevocably and unconditionally agrees that all claims arising out of or relating to this Agreement or the Credit Agreement brought by them shall be brought, and shall be heard and determined, exclusively in the aforementioned Delaware or New York c ourts. Each Party irrevocably waives any objection as to venue or inconvenient forum. Each Party 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.
19. TSA Effective Date; Conditions to Effectiveness.
This Agreement shall become effective and binding upon each of the Parties at 12:01 a.m. prevailing Eastern Time on the date on which all of the following conditions are satisfied (the “ TSA Effective Date ”):
|
a. |
the Consenting Lenders shall have received duly executed signature pages for this Agreement signed by the Partnership; |
|
b. |
the Partnership shall have received duly executed signature pages for this Agreement from Consenting Lenders constituting “Required Lenders” and “Required Revolving Lenders”, as each of those terms is defined in the Credit Agreement; and |
|
c. |
each of the representations and warranties made by the Partnership in Section 3 hereof or elsewhere in this Agreement shall be true and correct as of the TSA Effective Date. |
Upon the TSA Effective Date, the Term Sheets shall be deemed effective for the purposes of this Agreement, and thereafter the terms and conditions therein may only be amended, modified, waived, or otherwise supplemented as set forth in Section 13 .
20. No Solicitation.
Notwithstanding anything to the contrary, this Agreement is not and shall not be deemed to be an offer for the issuance, purchase, sale, exchange, hypothecation, or other transfer of securities or a solicitation of an offer to purchase or otherwise acquire securities for purposes of the Securities Act and the Securities Exchange Act.
21. Third-Party Beneficiary.
The terms and provisions of this Agreement are intended solely for the benefit of the Parties hereto and their respective successors and permitted assigns, and it is not the intention of the Parties to confer third-party beneficiary rights upon any other Person.
15
22. Successors and Assigns ; Severability .
Except as otherwise provided in this Agreement, this Agreement is intended to bind and inure to the benefit of each of the Parties and each of their respective successors, assigns, heirs, executors, administrators and representatives. If any provision of this Agreement or the application of any such provision to any person or circumstance shall be held invalid or unenforceable in whole or in part, such invalidity or unenforceability shall attach only to such provision or part thereof and the remaining part of such provision hereof and this Agreement shall continue in full force and effect, provided , however , that nothing in this Section 22 shall be deemed to amend, supplement or otherwise modify, or constitute a waiver of, any Termination Event.
23. Counterparts.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same agreement. Execution copies of this Agreement may be delivered by electronic mail (in “.pdf” or “.tif” format), facsimile or otherwise, which shall be deemed to be an original for the purposes of this Agreement.
24. Headings.
The section headings of this Agreement are for convenience of reference only and shall not, for any purpose, be deemed a part of this Agreement.
25. No Waiver of Participation and Preservation of Rights.
Except as provided in this Agreement, nothing herein is intended to, does, or shall be deemed in any manner to waive, limit, impair, or restrict the ability of each of the Lenders to (i) protect and preserve its rights, remedies, and interests, including, but not limited to, its claims against any other Party and any liens or security interests it may have in any assets of the Partnership, (ii) purchase, sell or enter into any transactions in connection with the Debt, subject to the restrictions provided for herein in respect of such Transfers, (iii) enforce any right under the Credit Agreement, subject to the terms hereof, (iv) consult with other Consenting Lenders, the Partnership or any other Transaction Party, or (v) enforce any right, remedy, condition, consent or approval requirement under this Agreement or in any of the Definitive Documents. Without limiting the foregoing sentence in any way, if this Agreement is terminated in accordance with its terms for any reason (other than consummation of the Transaction), the Parties each fully and expressly reserve any and all of their respective rights, remedies, claims, defenses and interests, subject to Sections 7 and 8 in the case of any claim for breach of this Agreement arising prior to termination.
26. Consideration.
The Parties hereby acknowledge that no consideration, other than that specifically described herein and in the Term Sheet and the Definitive Documents shall be due or paid to any Party for its agreement to support the Transaction in accordance with the terms and conditions of this Agreement.
16
This Agreement is the product of negotiations among the Parties, and the enforcement or interpretation of this Agreement is to be interpreted in a neutral manner. Any presumption with regard to interpretation for or against any Party by reason of that Party having drafted or caused to be drafted this Agreement or any portion of this Agreement, shall not be effective in regard to the interpretation of this Agreement.
28. Several, Not Joint, Claims.
The agreements, representations, warranties and obligations of the Parties to this Agreement are, in all respects, several and not joint.
29. Notices.
All notices, requests, demands, document deliveries and other communications hereunder shall be deemed given if in writing and delivered, if sent by email, facsimile, courier or by registered or certified mail (return receipt requested) to the following addresses, email addresses and facsimile numbers (or at such other addresses, email addresses or facsimile numbers as shall be specified by like notice):
If to the Partnership, to counsel at the following address:
Foresight Energy LP
211 North Broadway, Suite 2600
Saint Louis, MO 63102
Attn: Rashda Buttar, General Counsel
Email: rashda.buttar@foresight.com
with a copy (which shall not constitute notice) to:
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019
Facsimile: (212) 492-0158
Attn: Kelley A. Cornish, Alice Belisle Eaton and Lauren Shumejda
Email: kcornish@paulweiss.com , aeaton@paulweiss.com, lshumejda@paulweiss.com
If to any Consenting Lender, to the address set forth on its signature page.
[Remainder of page intentionally left blank]
17
Exhibit 10.1
EXECUTION VERSION
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered by their respective duly authorized officers or other agents, solely in their respective capacity as officers or other agents of the undersigned and not in any other capacity, as of the date first set forth above.
FORESIGHT ENERGY LLC
Title:President and Chief Executive Officer |
[ signature page to Transaction Support Agreement]
GUARANTORS
:
FORESIGHT ENERGY FINANCE CORPORATION
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
FORESIGHT ENERGY SERVICES LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
FORESIGHT COAL SALES LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
FORESIGHT SUPPLY COMPANY LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
HILLSBORO ENERGY LLC
By: /s/ Robert D. Moore |
2
MACOUPIN ENERGY LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
OENEUS LLC D/B/A SAVATRAN LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
SUGAR CAMP ENERGY, LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
WILLIAMSON ENERGY, LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
AMERICAN CENTURY MINERALS LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
3
AMERICAN CENTURY TRANSPORT LLC
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
|
|
FORESIGHT ENERGY LP
|
By: /s/ Robert D. Moore |
Name: Robert D. Moore Title: President and Chief Executive Officer |
[ signature page to Transaction Support Agreement]
4
AGREED BY EACH OF THE
FOLLOWING
PARTIES:
[ ]
Authorized Signatory:
By: |
Name: Title: |
Aggregate Principal Amount of Debt under the Credit Agreement: $_______________________
Name and Address of Contact for Notices:
Name: |
|
Address: |
|
Facsimile: |
|
Email: |
|
[ signature page to Transaction Support Agreement]
5
Exhibit 10.1
EXECUTION VERSION
Amendment Term Sheet
CONFIDENTIAL
TERM SHEET
Foresight Energy LLC
Third Amended and Restated Credit Agreement
Summary of Principal Terms and Conditions
Set forth below is a summary of the principal terms and conditions for the amendment and restatement of the Second Amended and Restated Credit Agreement dated as of August 23, 2013 among Foresight Energy LLC, the letter of credit issuing banks party thereto, the lenders party thereto and Citibank, N.A., as administrative agent and collateral agent (as amended, restated, supplemented or otherwise modified prior to the date hereof, the “ Existing Credit Agreement ”). This summary does not purport to summarize all the terms, conditions, representations and other provisions with respect to the amendment and restatement of the Existing Credit Agreement, which, to the extent not specified herein, will be set forth in the Third Amended and Restated Credit Agreement and include additional corrections and modifications to reflect the operational and strategic requirements of the Borrower and its subsidiaries, as may be mutually agreed by the parties, and to include LSTA contractual bail-in language. Any capitalized terms used herein and not otherwise defined shall have the meanings give such terms in the Existing Credit Agreement.
Borrower : |
Foresight Energy LLC, a Delaware limited liability company (the “ Borrower ”). |
|
Agent : |
Citibank, N.A., as administrative agent and collateral agent for the Senior Facilities (in such capacities, the “ Agent ”). |
|
Senior Facilities : |
(A) Senior secured term loans in an aggregate outstanding principal amount of $[297.8 million] (the “ Term Facility ” and the loans thereunder, the “ Term Loans ”), subject to any reductions prior to the Effective Date (as defined below) as a result of prepayments by the Borrower (including any amortization payments). |
2
3
4
Same as Existing Credit Agreement. |
||
Affirmative Covenants : |
Same as Existing Credit Agreement, except that (i) as an additional requirement, within 30 days after the end of each of the first two months of each fiscal quarter, the Borrower shall provide to the Agent for distribution to those Lenders that are not Public Lenders an unaudited monthly management consolidated balance sheet and income statement of the Borrower and its Subsidiaries (in a form consistent with the Borrower’s current practice and, for the avoidance of doubt, subject to normal quarterly or year-end adjustments and the absence of footnotes) and (ii) the requirement that audit opinion not be qualified by a “going concern” or like qualification or exception shall not apply to the financial statements of the Borrower delivered for the fiscal year ended December 31, 2015. |
5
6
7
8
9
Applicable Rate
The first clause of the definition of Applicable Rate in Section 1.01 of the Credit Agreement (prior to the proviso therein) will be amended and restated as follows:
“ Applicable Rate ” means (a) in the case of Term Loans, (i) 5.50% per annum for Eurocurrency Rate Loans and (ii) 4.50% per annum for Base Rate Loans and (b) in the case of the Revolving Loans and Swing Line Loans, the applicable percentage per annum set forth below determined by reference to the Consolidated Net Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 6.02(b) :
provided that (a) the Applicable Rate will be determined as of the last day of the immediately preceding fiscal quarter, (b) the Applicable Rate determined for any Adjustment Date (including the first Adjustment Date) shall remain in effect until a subsequent Adjustment Date for which the Consolidated Net Leverage Ratio falls within a different level, and (c) if the financial statements and related Compliance Certificate for any fiscal period are not delivered by the date due pursuant to Sections 6.01 and 6.02 , the Applicable Rate shall be set at Level V until the date of delivery of such financial statements and Compliance Certificate, after which the Applicable Rate shall be based on the Consolidated Net Leverage Ratio set forth in such Compliance Certificate.
Annex I-1
Intercreditor Term Sheet
Transaction Term Sheet
CONFIDENTIAL
Foresight: Intercreditor Agreement Term Sheet
Reference is made to (i) that certain Credit Agreement, dated as of August 12, 2010, amended and restated on December 15, 2011 and August 23, 2013, and amended by Incremental Amendment No. 1 dated as of May 27, 2015, and as further amended, amended and restated, modified or supplemented in connection with the Restructuring (as defined below) and from time to time (the “ First Lien Credit Agreement ”), between Foresight Energy LLC (the “ Borrower ”) and certain other parties; and (ii) (A) certain second lien senior convertible notes (the “ Second Lien Convertible Notes ”) to be issued by [_______] (the “ Issuer ”), and (B) certain second lien senior secured notes (the “ Second Lien Secured Notes ” and, together with the Second Lien Convertible Notes, the “ Second Lien Notes ”) to be issued by the Issuer, all of which Second Lien Notes will be guaranteed by, among others, the Borrower and secured by a junior lien on the Collateral (as defined below).
“ Restructuring ” means the transactions related to the restructuring of outstanding indebtedness of the Borrower and its affiliates arising as a result of the occurrence of certain events of default thereunder, including, without limitation, indebtedness outstanding under the First Lien Credit Agreement and under the Senior Notes (as defined in the First Lien Credit Agreement). For purposes of this term sheet, the Facilities (as defined in the First Lien Credit Agreement) under the First Lien Credit Agreement (and the facilities provided in any refinancings, substitutions, extensions or replacements thereof) are herein referred to collectively as the “ First Lien Credit Facility ” and the First Lien Credit Facility together with the Second Lien Notes (and any refinancings, substitutions, extensions or replacements thereof) are referred to herein individually as a “ Debt Facility ” and collectively as the “ Debt Facilities ”. Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the First Lien Credit Agreement as in effect as of the date hereof.
Each of the Second Lien Claimholders will waive any claim such Second Lien Claimholders may have against the First Lien Administrative Agent, the First Lien Collateral Agent or any other First Lien Claimholders (or their representatives) arising out of any election by the First Lien Administrative Agent, First Lien Collateral Agent or any First Lien Claimholders, in any proceeding instituted under the Bankruptcy Code, of the application of Section 1111(b) of the Bankruptcy Code.
|
|
Plan support: |
Without the consent of the First Lien Claimholders, the Second Lien Claimholders will not propose or support any plan that does not contemplate payment of the First Lien Obligations in full in cash or is otherwise inconsistent with the Intercreditor Agreement.
|
Separate grants: |
Each of the First Lien Claimholders and the Second Lien Claimholders will agree that (a) the grants of liens under the First Lien Collateral Documents and the Second Lien Collateral Documents are separate and distinct grants and (b) First Lien Obligations and Second Lien Obligations must be separately classified in any bankruptcy.
|
Rights As Unsecured Creditors: |
The First Lien Claimholders may exercise rights and remedies as unsecured creditors against any of the Loan Parties.
|
Insurance: |
The First Lien Collateral Agent shall have the sole right (subject to the Borrower’s rights under the First Lien Credit Agreement, and the other documents relating thereto) to adjust and settle insurance claims with respect to the Collateral and approve awards granted with respect to the Collateral in any condemnation or similar proceeding.
|
Purchase Right: |
If an Event of Default under and as defined in the First Lien Credit Agreement has occurred and is continuing and the amount of any claim or claims in respect of any First Lien Obligations has been determined, the Second Lien Claimholders will be permitted within an agreed exercise period to purchase the entire amount of such claim or claims at par plus any accrued interest (and payment of any outstanding fees and expenses) from such First Lien Claimholders during a call period to be agreed.
|
Interpretation: |
For the avoidance of doubt, any determinations as to whether a First Lien Obligation has been paid in full in cash hereunder shall be made without taking into account any limitations on such obligations imposed by the United States Bankruptcy Code or other applicable insolvency law. |
|
|
Governing Law; Jurisdiction: |
The State of New York.
|
Form of Joinder
The undersigned hereby acknowledges that it has reviewed and understands the Transaction Support Agreement, dated as of April 18, 2016 (as amended, supplemented or otherwise modified from time to time, the “ Agreement ”) 1 by and among by and among Foresight Energy LLC, a Delaware limited liability company (“ Foresight Energy ”), certain subsidiaries of Foresight Energy, and Foresight Energy LP (collectively, the “ Partnership ”) and the undersigned Lenders (as defined therein, and together with their permitted successors and assigns, each a “ Consenting Lenders ” and, collectively, the “ Consenting Lenders ”), and agrees to be bound as a Consenting Lender by the terms and conditions thereof binding on the Consenting Lenders for as long as the Agreement is in place.
The undersigned hereby makes the representations and warranties of the Consenting Lender set forth in Section 3(a) of the Agreement to each other Party, effective as of the date hereof.
This joinder agreement shall be governed by the governing law set forth in the Transaction Support Agreement.
Date: _________________, 2016
[Consenting Lender]
By:_________________________________
Name:
Title:
Debt held (in principal face value) under the Credit Agreement: $
Attention:
Fax:
Email:
|
1 |
Defined terms used but not otherwise defined herein shall have the meanings ascribed to them in the Agreement. |