Attached files
| file | filename |
|---|---|
| 10-K/A - 10-K/A - VIDLER WATER RESOURCES, INC. | pico10-ka12312012.htm |
| EX-31.2 - CERTIFICATION OF CFO PER SARBANES-OXLEY ACT - VIDLER WATER RESOURCES, INC. | picoexhibit31210-ka2012.htm |
| EX-10.26 - FOURTH AMENDMENT TO CREDIT AGREEMENT DATED AUGUST 14, 2012 - VIDLER WATER RESOURCES, INC. | fourthamendmenttocreditagr.htm |
| EX-10.25 - THIRD AMENDMENT TO CREDIT AGREEMENT DATED MAY 25, 2012 - VIDLER WATER RESOURCES, INC. | thirdamendmenttocreditagre.htm |
| EX-10.23 - FIRST AMENDMENT TO CREDIT AGREEMENT DATED OCTOBER 14, 2011 - VIDLER WATER RESOURCES, INC. | firstamendmenttocreditagre.htm |
| EX-10.27 - FIFTH AMENDMENT TO CREDIT AGREEMENT DATED OCTOBER 17, 2012 - VIDLER WATER RESOURCES, INC. | fifthamendmenttocreditagre.htm |
| EX-31.1 - CERTIFICATION OF CEO PER SARBANES-OXLEY ACT - VIDLER WATER RESOURCES, INC. | picoexhibit31110-ka2012.htm |
EXECUTION COPY
SECOND AMENDMENT TO
CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made and entered into as of February 8, 2012, by and among PICO Northstar Hallock, LLC, a Delaware limited liability company (the “Borrower”), PICO Northstar, LLC, a Delaware limited liability company (the “Parent Guarantor”), the lenders from time to time party to the Credit Agreement, as defined below (the “Lenders”), and ING Capital LLC, a Delaware limited liability company, as agent for the Lenders (the “Agent”).
W I T N E S S E T H:
WHEREAS, the Borrower, the Parent Guarantor, the Lenders and the Agent are parties to that certain Credit Agreement dated as of June 13, 2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”; capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement), pursuant to which the Lenders have made certain financial accommodations available to the Borrower; and
WHEREAS, the Borrower has requested that the Credit Agreement be amended as set forth herein, and the Required Lenders have agreed to so amend the Credit Agreement as set forth herein, subject to the terms and conditions hereof;
NOW, THEREFORE, for good and valuable consideration, the sufficiency and receipt of all of which are acknowledged, the Borrower, the Parent Guarantor, the Required Lenders and the Agent hereby agree as follows:
1.Amendment to Section 1.1 of the Credit Agreement. The Credit Agreement is hereby amended by replacing clause (b) of the definition of “Change of Control” in their entirety with the following:
(b) the failure of the Sponsor to own and hold, directly or indirectly, beneficially and of record, not less than (i) eighty-eight percent (88%) of the Common Stock, other than as a result of any Additional Equity Issuance (2012), and (ii) 100% of the Qualified Preferred Equity Interests of the Parent Guarantor;
2.Amendment to Section 1.1 of the Credit Agreement. The Credit Agreement is hereby amended by replacing the definition of “Permitted Hedge Contract” in its entirety with the following:
“Permitted Hedge Contract” means (a) any Hedge Contract that is required to be entered into pursuant to the terms hereof on or subsequent to the Closing Date, (b) the Qualified Commodity Hedge Contract, and (c) any other Hedge Contract that
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has been approved by the Required Lenders and the Agent; provided, however, that “Permitted Hedge Contract” shall not include a Permitted Exchange-Traded Commodity Contract.
3.Amendment to Section 1.1 of the Credit Agreement. The Credit Agreement is hereby amended by adding, or replacing existing defined terms with, as the case may be, the following new defined terms in alphabetical order:
“Additional Equity Issuance (2012)” shall mean the issuance by the Parent Guarantor of additional common equity membership interests to the Original Member after January 1, 2012 and on or prior to December 31, 2012, provided that (i) the terms and conditions applicable to such issuance and common equity membership interests are reasonably acceptable to the Agent, (ii) the aggregate amount of Net Issuance Proceeds resulting from all such issuances does not exceed $10,000,000, and (iii) the aggregate amount of Net Issuance Proceeds resulting from all such issuances are contributed by the Parent Guarantor to the equity capital of the Borrower and are used by the Borrower for working capital purposes.
“Approved Commodity Intermediary” shall mean a Commodity Intermediary approved by the Agent in writing and acting in its capacity as Commodity Intermediary of a Permitted Commodity Account.
“Commodity Account” shall mean a “commodity account” as such term is defined in the Uniform Commercial Code of any relevant State of the United States or a “futures account” as defined in the Personal Property Security Act of any relevant Province of Canada, as applicable.
“Commodity Contract” shall mean a “commodity contract” as such term is defined in the Uniform Commercial Code of any relevant State of the United States or a “futures contract” as defined in the Personal Property Security Act of any relevant Province of Canada, as applicable.
“Commodity Customer” shall mean a “commodity customer” as such term is defined in the Uniform Commercial Code of any relevant State of the United States or a “futures customer” as defined in the Personal Property Security Act of any relevant Province of Canada, as applicable.
“Commodity Intermediary” shall mean a “commodity intermediary” as such term is defined in the Uniform Commercial Code of any relevant State of the United States or a “futures intermediary” as defined in the Personal Property Security Act of any relevant Province of Canada, as applicable.
“Permitted Exchange-Traded Commodity Contract” means any exchange-traded Commodity Contract credited to or carried in a Permitted Commodity
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Account, provided that such Commodity Contract is acquired by the Borrower solely for bona fide hedging purposes and not for speculative purposes.
“Permitted Commodity Account” means any Commodity Account maintained by an Approved Commodity Intermediary for the Borrower as Commodity Customer and to which is credited or in which is carried Permitted Exchange-Traded Commodity Contracts, provided that the Agent has “control” (within the meaning of Section 8-106 of the Uniform Commercial Code of any relevant State of the United States or Section 1.1 of the Personal Property Security Act of any relevant Province of Canada, as applicable) of such Commodity Account pursuant to a Commodity Account Control Agreement in form and substance satisfactory to the Agent.
“Qualified Commodity Hedge Contract Account” means a Deposit Account established by the Borrower on or prior to the Project Construction Completion Date, into which the Borrower shall deposit all proceeds that it receives pursuant to the Qualified Commodity Hedge Contract in accordance with Section 6.2.21, which Deposit Account shall be subject to a Deposit Account Control Agreement.
“Sponsor Temporary Working Capital Loan” means one or more loans made to the Borrower by the Sponsor prior to the Project Construction Completion Date, the proceeds of which are solely for use by the Borrower to purchase canola seed for processing at the Project and for related hedging activities (including, without limitation, the posting of margin collateral in a Permitted Commodity Account for the purpose of hedging the price of canola seed, canola oil, canola meal and natural gas), which loan or loans may be secured solely by the Borrower’s interest in the Sponsor Temporary Working Capital Loan Collateral, and which loan or loans shall have terms, including interest rates and tenor, satisfactory to the Agent and shall be subject to documentation and an intercreditor agreement in form and substance satisfactory to the Agent; provided, however, that the outstanding principal amount of such loan or loans shall not exceed in the aggregate at any time $10,500,000.
“Sponsor Temporary Working Capital Loan Collateral” means
(i) all canola seed purchased as Inventory by the Borrower with the proceeds of the Sponsor Temporary Working Capital Loan (the “Canola Inventory”);
(ii) all products made from the Canola Inventory, including, but not limited to, canola seed oil and canola seed meal, whether in their final state as finished goods or in an intermediate, work-in-process state and being of any grade or character, crude or otherwise (the “Canola Products”);
(iii) all “accounts” (as defined in the UCC) arising from the sale or other disposition of such Canola Inventory or Canola Products (the “Canola Accounts”);
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(iv) all rights and remedies of the Borrower under contracts between the Borrower and third parties for (A) the purchase by the Borrower of the Canola Inventory, (B) the sale or other disposition by the Borrower of the Canola Inventory or the Canola Products, or (C) the transportation, storage or handling of the Canola Inventory or the Canola Products;
(v) all “chattel paper” and “instruments” (each as defined in the UCC) evidencing a monetary obligation to pay the Borrower arising from the sale or other disposition by the Borrower of the Canola Inventory or the Canola Products;
(vi) all “documents” (as defined in the UCC) acknowledging possession of the Canola Inventory or the Canola Products;
(vii) all Commodity Accounts and “commodity contracts” (as defined in the UCC) of the Borrower, other than a Qualified Commodity Hedge Contract;
(viii) all rights under insurance contracts, and all insurance proceeds paid to or collectable by the Borrower, with respect to the Canola Inventory or the Canola Products; and
(ix) all identifiable cash proceeds from the Canola Inventory, the Canola Products or the Canola Accounts, and Deposit Account number #XXXXXXXXXX (ABA #122000496) maintained by the Borrower at Union Bank, 1980 Saturn Street, Monterey Park, CA 91755 (tel: 800-418-6466) for the sole purpose of depositing identifiable cash proceeds of the Canola Inventory, the Canola Products and the Canola Accounts;
provided, however, that “Sponsor Temporary Working Capital Loan Collateral” shall in no event include (a) the Project Site, the Project Improvements or any other real estate, fixtures or equipment of the Borrower, (b) the Major Project Documents, (c) any other documents or agreements entered into by the Borrower with respect to the design, development, procurement or construction of the Project, (d) any documents or agreements entered into by the Borrower with respect to the operation of the Project other than those specifically identified in clauses (iii) through (viii) above, (e) the Loan Documents, (f) any Contribution Documents, including, without limitation, the Agreement to Contribute Capital, (g) the proceeds of any Contribution, including, without limitation, the proceeds of any PICO Equity Contribution, Financial Covenant Default Contribution or Cost Overrun Contribution, (h) the proceeds of any Qualified Preferred Equity Issuance or any other equity issuance by or capital contribution to the Borrower or the Parent Guarantor, (i) the Debt Service Reserve Account or the Cost Overrun Account, (j) any Deposit Account of the Borrower other than the Deposit Account specifically identified in clause (ix) above, or (k) any Qualified Commodity Hedge Contract.
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4.Amendment to Section 3.3.1 of the Credit Agreement. The Credit Agreement is hereby amended by replacing subsection (j) of Section 3.3.1 in its entirety with the following:
(j) shall, promptly after (and in any event within two (2) Business Days following) receipt by the Borrower or any Subsidiary or the Agent of any Net Securities Proceeds (excluding Net Securities Proceeds resulting from any Additional Equity Issuance (2012)), make a payment to the Agent in an amount equal to such Net Securities Proceeds; provided, that this clause (j) of Section 3.3.1 shall not in any event be deemed a consent to any issuance or sale of Stock by any Loan Party that is otherwise prohibited by the terms of this Agreement or of any of the other Loan Documents;
5.Amendment to Article 4 of the Credit Agreement. The Credit Agreement is hereby amended by adding a new Section 4.6 to Article 4 as follows:
SECTION 4.6 Working Capital Loans . Without duplication of any conditions precedent required to be satisfied on or before the Closing Date pursuant to Section 4.1, the obligations of the Lenders to make any Working Capital Facility Loans, or to cause or participate in the issuance of Letters of Credit, shall be subject to each of the additional conditions precedent: (i) the Project Construction Completion Date shall have occurred, (ii) after giving effect such Working Capital Facility Loans and the issuance of such Letters of Credit, the aggregate of all Working Capital Facility Loans plus the aggregate outstanding amount of all Letter of Credit Obligations does not exceed the Borrowing Base, and (iii) all Sponsor Temporary Working Capital Loans shall have been (or contemporaneously with the making of such Working Capital Facility Loans and Letters of Credit shall be) repaid in full, all commitments to provide Sponsor Temporary Working Capital Loans shall have been (or contemporaneously with the making of such Working Capital Facility Loans and Letters of Credit shall be) terminated, and all Liens securing Sponsor Temporary Working Capital Loans shall have been (or contemporaneously with the making of such Working Capital Facility Loans and Letters of Credit shall be) terminated and released.
6.Amendment to Section 6.2.2 of the Credit Agreement. The Credit Agreement is hereby amended by replacing subsection (d) of Section 6.2.2 in its entirety with the following:
(d) Permitted Hedge Contracts and Permitted Exchange-Traded Commodity Contracts;
7.Amendment to Section 6.2.3 of the Credit Agreement. The Credit Agreement is hereby amended by replacing subsection (l) of Section 6.2.3 in its entirety with the following:
(l) Liens in favor of an Approved Commodity Intermediary on cash and Permitted Exchange-Traded Commodity Contracts credited to or carried in a Permitted Commodity Account maintained by such Approved Commodity
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Intermediary for the Borrower, provided that such Liens secure only obligations of the Borrower to the Approved Commodity Intermediary in respect of such Permitted Commodity Account;
8.Amendment to Section 6.2.7 of the Credit Agreement. The Credit Agreement is hereby amended by replacing subsection (e) of Section 6.2.7 in its entirety with the following:
(e) cash and Permitted Exchange-Traded Commodity Contracts credited to or carried in a Permitted Commodity Account, and Permitted Hedge Contracts.
9.Amendment to Section 6.2 of the Credit Agreement. The Credit Agreement is hereby amended by adding a new Section 6.2.21 as follows:
SECTION 6.2.21 Qualified Commodity Hedge Contract. The Borrower shall not amend the Qualified Commodity Hedge Contract in any manner that is inconsistent with the terms specified in Schedule 1.1(g) attached hereto and by this reference made a part hereof, and shall cause all amounts payable to the Borrower under the Qualified Commodity Hedge Contract to be payable in cash, in immediately available funds, and to be deposited into the Qualified Commodity Hedge Contract Account. Subject to Section 7.4 of this Agreement, the Borrower shall use all proceeds of the Qualified Commodity Hedge Contract deposited in the Qualified Commodity Hedge Contract Account solely (i) to pay accrued and unpaid fees that are due and payable under Section 2.3 of this Agreement, (ii) to pay accrued and unpaid interest on outstanding Loans that are due and payable under Section 3.4 of this Agreement, (iii) to pay scheduled principal installments on the Term Loan as provided in Section 3.3.1(c) of this Agreement, and (iv) to pay any amount that is due and payable by the Borrower under the Qualified Commodity Hedge Contract.
10.Amendment to Schedule 1.1(g) of the Credit Agreement. The Credit Agreement is hereby amended by replacing in its entirety Schedule 1.1(g) to the Credit Agreement, entitled “Terms of Qualified Commodity Hedge Contract and Qualified Commodity Hedge Intercreditor Agreement”, with Schedule 1.1(g) attached hereto and by this reference made a part hereof.
11.Conditions to Effectiveness of this Amendment. Notwithstanding any other provision of this Amendment, this Amendment shall not become effective, and the Borrower and the Parent Guarantor shall have no rights under this Amendment, until the Agent shall have received duly authorized, executed and delivered counterparts to this Amendment from each of the Borrower, the Parent Guarantor and the Required Lenders.
12.Representations and Warranties. To induce the Lenders and the Agent to enter into this Amendment, each of the Borrower and the Parent Guarantor hereby represents and warrants to the Lenders and the Agent as follows:
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(a) The execution, delivery and performance by it of this Amendment are within its organizational powers and have been duly authorized by all necessary organizational, and if required, shareholder, partner or member action.
(b) The execution, delivery and performance by it of this Amendment have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of any of its Organizational Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which it is a party or affecting it or its properties or any of its Subsidiaries or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which it or its property is subject; or (c) violate any applicable law.
(c) This Amendment has been duly executed and delivered by it, and the Credit Agreement, as amended by this Amendment, constitutes its legal, valid and binding obligation, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity.
(d) The representations and warranties of the Borrower contained in the Credit Agreement and the other Loan Documents (i) were true and correct in all material respects as of the date initially made, and (ii) are true and correct in all material respects with the same effect as if made on the date hereof and both before and after giving effect to this Amendment and the transactions contemplated hereby (except to the extent expressly stated to be as of an earlier date).
(e) No material adverse development has occurred in any litigation, arbitration or governmental investigation or proceeding which renders such litigation, arbitration or governmental investigation or proceeding likely to succeed and, which, if successful could reasonably be expected to result in a Material Adverse Change, a Cost Overrun or a Project Delay.
(f) No Default or Event of Default has occurred and is continuing or would result from this Amendment or the transactions contemplated hereby.
(g) Since the Closing Date, no event has occurred which has had, or could reasonable be expected to have, a material adverse effect on the property, assets, nature of assets, business, operations, liabilities, condition (financial or otherwise) or prospects of the Borrower or the Project or (b) has resulted, or could reasonable be expected to result, in a Material Adverse Change, a Cost Overrun or a Project Delay.
13.Reaffirmations and Acknowledgments. The Borrower hereby acknowledges that, as of the date hereof, the security interests and Liens granted to the Agent and the Secured Parties under the Credit Agreement and the other Loan Documents are in full force and effect, are properly perfected and are enforceable in accordance with the terms of the Credit Agreement and the other Loan Documents, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity.
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14.Effect of Amendment. Except as expressly set forth herein, all terms of the Credit Agreement and the other Loan Documents shall be and remain in full force and effect and shall constitute the legal, valid, binding and enforceable obligations of the Borrower and the Parent Guarantor to the Lenders, the Agent and the other Secured Parties, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity. The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders or the Agent under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement or any Loan Document. This Amendment shall constitute a Loan Document for all purposes of the Credit Agreement.
15.Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
16.No Novation. This Amendment is not intended by the parties to be, and shall not be construed to be, a novation of the Credit Agreement or an accord and satisfaction in regard thereto.
17.Costs and Expenses. The Borrower agrees to pay all costs and expenses of the Agent in connection with this Amendment in accordance with Section 9.3 of the Credit Agreement, including without limitation, the reasonable costs and fees of King & Spalding LLC, counsel to the Agent.
18.Counterparts. This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment constitutes the entire contract among the parties relating to the subject matter hereof and supersedes any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. This Amendment shall become effective when it shall have been executed by the Agent and when the Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Amendment by facsimile, pdf or other electronic means shall be effective as delivery of a manually executed counterpart of this Amendment.
19.Binding Nature. This Amendment shall be binding upon and inure to the benefit of the parties hereto, their respective successors, successors-in-titles, and assigns.
[signature pages follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.
PICO NORTHSTAR HALLOCK, LLC
By: /s/ Neil C. Juhnke
Name: Neil C. Juhnke
Title: President
PICO NORTHSTAR, LLC
By: /s/ Neil C. Juhnke
Name: Neil C. Juhnke
Title: President
ING CAPITAL LLC
By: /s/ Dan Lamprecht
Name: Dan Lamprecht
Title: Managing Director
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
AGCOUNTRY FARM CREDIT SERVICES, FLCA,
as a Lender
By: /s/ James F. Baltezore
Name: James F. Baltezore
Title: Vice President
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
AGFIRST FARM CREDIT BANK,
as a Lender
By: /s/ Steven J. O'Shea
Name: Steven J. O'Shea
Title: Vice President
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
FARM CREDIT SERVICES OF AMERICA, PCA,
as a Lender
By: /s/ Curt A. Brown
Name: Curt A. Brown
Title: Vice President
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
FARM CREDIT WEST, FLCA,
as a Lender
By: /s/ Ben Madonna
Name: Ben Madonna
Title: Vice President
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
MACQUARIE BANK LIMITED,
as a Lender
By: /s/ Mark Topfer
Name: Mark Topfer
Title: Division Director
(Macquarie POA Ref: #594/10 dated 25 November 2010)
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
BANK OF NORTH DAKOTA,
as a Lender
By:______________________________
Name:
Title:
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
STATE BANK & TRUST,
as a Lender
By:______________________________
Name:
Title:
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
KODABANK,
as a Lender
By: ______________________________________
Name:
Title:
[SIGNATURE PAGE TO SECOND AMENDMENT TO CREDIT AGREEMENT]
SCHEDULE 1.1(g)
Terms
of
Qualified Commodity Hedge Contract
and
Qualified Commodity Hedge Intercreditor Agreement
Capitalized terms used below without definition are defined in the Credit Agreement dated as of June 13, 2011 (the “Credit Agreement”) among PICO Northstar Hallock, LLC (the “Borrower”), PICO Northstar, LLC (together with Borrower, the “Loan Parties”), the Lenders, and ING Capital LLC, as agent (the “Agent”).
Qualified Commodity Hedge Contract
Crush Spread Swap
Transaction Date: | Within 365 days from the Closing Date or such later date as the Agent shall approve in its sole and absolute discretion |
Product: | Financial Settled Spread Swap (the “Swap Transaction”) |
Term: | Up to three years |
Notional Quantity: | Up to the maximum expected output of the Project |
Floating Price Payer: | Borrower |
Fixed Price Payer: | Qualified Counterparty |
Floating Spread: | Index A + Index B - Index C |
Index A: | 75% x Soybean Meal CBOT Prompt Month Futures x 56.4%, specified in USD per Short Ton |
Index B: | Soybean Oil CBOT Prompt Month Futures x 41.7%, specified in USD per Short Ton |
Index C: | WCE Canola Seed Prompt Month Futures, specific USD per Short Ton |
Fixed Spread: | An amount (specified in USD per Short Ton) to be determined and agreed upon by the Fixed Price Payer and Floating Price Payer |
Calculation Period: | Each Calendar Quarter, Calendar Month, or Calendar Week during the Term, as agreed upon by the Fixed Price Payer and Floating Price Payer |
Settlement Amount: | If the Fixed Spread exceeds the Floating Spread, the Fixed Price Payer would pay the Floating Price Payer the difference between the two such amounts multiplied by the Notional Quantity per Calculation Period. |
If the Floating Price exceeds the Fixed Price, the Floating Price Payer would pay the Fixed Price Payer the difference between the two such amounts multiplied by the Notional Quantity per Calculation Period. If the Floating Price is equal to the Fixed Price, then no payment would be made. | |
The Settlement Amount shall be payable in cash, in immediately available funds, on each Payment Date. | |
Payment Date: | With respect to a Calculation Period that is a Calendar Quarter or Calendar Month, the 10th business day following the end of such period, and with respect to a Calculation Period that is a Calendar Week, the 2nd business day following the end of such period. |
Credit Support: | The Swap Transaction shall constitute a Qualified Commodity Hedge Contract. Accordingly, the Fixed Price Payer would have a perfected, first priority lien on assets and funds, pari passu in right of security and payment with the Lenders and other Secured Parties, subject to the terms of the Credit Agreement and the Qualified Commodity Hedge Intercreditor Agreement. |
Other Considerations: | 1. Fixed Price Payer, in its capacity as such, and as a Qualified Counterparty to a Qualified Commodity Hedge Contract, will constitute a Secured Party under the Credit Agreement and the Security Documents, will be a party to and a beneficiary of the Qualified Commodity Hedge Intercreditor Agreement, and will have consents rights provided in Section 9.1(f) of the Credit Agreement. These rights would be in addition to any rights the Fixed Price Payer or any of its Affiliates may have in its capacity as a Lender under the Credit Agreement. 2. The Swap Transaction shall be documented under an ISDA Master Agreement which would include, in addition to the standard ISDA terms, provisions relevant for a transaction of this type, including provisions related to the pari passu nature of the lien and a cross default to the indebtedness under the Credit Agreement. 3. The Swap Transaction documentation shall provide for covenants (including a covenant prohibiting speculative trading), events of default (including a termination event if the Borrower enters into Qualified Commodity Hedge Contracts with other Qualified Counterparties) and termination events reasonably acceptable to the Agent, but in no event shall the Swap Transaction documentation provide for an event of default or termination event for failure to satisfy the Project Construction Completion Requirements with a deadline prior to April 15, 2014. 4. The Swap Transaction documentation will include a right for the Qualified Counterparty to delay the start of the term and re-price the Swap Transaction to reflect the Qualified Counterparty's losses (including mark-to-market losses) in respect of such delay if the Project Construction Completion Requirements are not expected to be satisfied prior to the start date of the Swap Transaction. |
Qualified Commodity Hedge Intercreditor Agreement
Parties: | The Agent, each Loan Party, and each Qualified Counterparty that is a party to a commodities-based Secured Hedge Agreement. |
Purpose: | To establish the relative rights and privileges of the Secured Parties with respect to the Collateral. |
Secured Parties: | As defined in the Credit Agreement, including the Qualified Counterparty. |
Obligations: | As defined in the Credit Agreement , including all obligations of every nature of any Loan Party from time to time owed to the Qualified Counterparty for ordinary course settlement payments and payments for early termination of or under the Qualified Commodity Hedge Contract. |
Remedies: | The Agent may, and at the direction of the Required Lenders, shall exercise remedies with respect to the Collateral as provided in Section 7.2 and Section 7.3 of the Credit Agreement. The Qualified Counterparty shall be entitled to participate in the directing of the Agent with respect to remedies relating to the Collateral as if the Qualified Counterparty were a Lender, as more particularly provided in Section 9.1(f) of the Credit Agreement. |
No Contest of Liens or Right to Credit Bid: | No Secured Party will contest or support any other person in contesting, in any proceeding (including any bankruptcy or insolvency proceeding), the priority, validity or enforceability of any lien held by or on behalf of any of the Secured Parties in the Collateral. Additionally, no Secured Party will oppose or otherwise contest any lawful exercise by the Agent of the right to credit bid the Obligations at any sale in foreclosure of the liens granted to the Agent for the benefit of the Secured Parties so long as such bid is approved separately by the Required Lenders. |
Avoidance of Liens or Obligations: | The terms of the Intercreditor Agreement shall govern even if part or all of the Obligations or the liens securing payment and performance thereunder are not perfected or are avoided, disallowed, set aside or otherwise invalidated in any judicial proceeding or otherwise. |
Amendments; Waivers; Consents: | As provided in Section 9.1 of the Credit Agreement. The consent of each Qualified Counterparty shall be required (i) with respect to any amendment, modification or waiver of the Qualified Hedge Related Provisions of the Credit Agreement that is adverse to the interest of the Qualified Counterparty in its capacity as such, and (ii) to the extent any amendment, modification or waiver of any provision of any Security Document would disproportionately impact a Qualified Counterparty (or the Qualified Counterparties as a class) relative to the Lenders, provided that such Qualified Counterparty notifies the Agent of such disproportionate impact reasonably promptly after receiving written notice of such proposed amendment, modification or waiver. Each Secured Party shall have the right to call for a vote on the decision to initiate remedies with respect to the Collateral following an Event of Default. The Secured Party calling such vote shall be responsible for issuing all notices to the other Secured Parties, collecting the results of such vote and presenting such results to the Agent and any written direction of the Required Lenders resulting from such vote. For the avoidance of doubt, the Agent shall have no responsibilities in providing notices of such vote, causing any Secured Party to respond or receiving responses, provided however, that the Agent shall be required to act in accordance with the written direction of the Required Lenders resulting from such vote to the extent it is otherwise required to so act under the Credit Agreement. |
Waterfall Application; Distributions of Collateral: | As provided in Section 7.4 of the Credit Agreement. The Agent shall give each Qualified Counterparty to a Qualified Commodity Hedge Contract notice of acceleration of the Obligations pursuant to Section 7.3 of the Credit Agreement and shall permit such Qualified Counterparty a commercially reasonable period (not to exceed 60 days following receipt of such notice of acceleration or such longer period as shall be acceptable to the Agent in its sole discretion) to terminate and calculate a termination payment due under its Qualified Commodity Hedge Contract before distributing any proceeds of Collateral or other amounts pursuant to Section 7.4 of the Credit Agreement. The amount of Obligations in respect of such Qualified Commodity Hedge Contract then due to such Qualified Counterparty shall be calculated after expiration of such period for purposes of Section 7.4 of the Credit Agreement. If, following acceleration of any Obligations, the Qualified Counterparty shall be precluded at the time of any distribution of Collateral that would otherwise occur pursuant to in accordance with Section 7.4 of the Credit Agreement from terminating the Qualified Commodity Hedge Contract as a consequence of the undertakings made in any third party consent given by Qualified Counterparty in favor of the Secured Parties, the Secured Parties shall cause any such requirement to be waived and permit the Qualified Counterparty sufficient time to terminate and calculate a termination payment due under its Qualified Commodity Hedge Contract before any Collateral is distributed. |
Turnover Provisions: | Each of the Secured Parties will agree to turn over any payments received in contravention of the Intercreditor Agreement. If, for any reason, a Secured Party does not have a valid and perfected lien (either directly or through the Agent) on any portion of the Collateral, proceeds on such portion received by the other Secured Parties will be paid over to the extent necessary to reflect the distribution provisions above as if all Secured Parties held such a lien. |
Acknowledgments: | The Intercreditor Agreement shall provide that each of the Secured Parties recognizes the existence and the permissibility of the other Secured Parties and their respective debt and/or lien obligations and rights. |
Releases: | The Intercreditor Agreement will provide the Agent with the ability to release its lien on any portion of Collateral in accordance with Section 8.8 of the Credit Agreement. |
Bankruptcy: | In the event of an insolvency or liquidation proceeding of any Loan Party, whether voluntary or involuntary, if the Agent shall desire to permit the use of cash collateral or to permit such Loan Party to obtain debtor-in-possession financing (a “DIP Financing”), then the other Secured Parties will agree that they will raise no objection to such use of cash collateral or DIP Financing and will not request adequate protection or any other relief in connection therewith; provided that (a) each Secured Party retains the right to object to any ancillary agreements or arrangements regarding the DIP Financing that are materially prejudicial to their interests (unless such ancillary agreements or arrangements, including, without limitation, any adequate protection orders, are equally materially prejudicial to all Secured Parties, in which case there shall be no independent right of a Secured Party to object), (b) the DIP Financing (i) does not compel any Loan Party to seek confirmation of a specific plan of reorganization for which all or substantially all of the material terms are set forth in the DIP Financing documentation or a related document and (ii) does not expressly require the liquidation of any Collateral prior to a default under the DIP Financing documentation, and (c) if any cash collateral order contemplates the liquidation of Collateral, such order provides that the liens of the Secured Parties will attach to the proceeds of such liquidation equally and ratably. To the extent any amounts advanced under the Credit Agreement prior to filing are granted the status or otherwise treated as debtor-in-possession financing, the Secured Parties agree that the provisions of the Intercreditor Agreement (including the distribution waterfall and the turnover provisions) will apply to payments received in respect of such debtor-in-possession financing. |
Rights as Unsecured Creditors: | All Secured Parties may exercise rights and remedies as unsecured creditors against any Loan Party. |
Purchase Right: | If a termination event or event of default under the Qualified Commodity Hedge Contract has been declared and the amount of the Qualified Counterparty’s claim or claims in respect of any termination payments has been established, the other Secured Parties will be permitted within an agreed exercise period to purchase the entire amount of such claim or claims at par (together with any accrued and unpaid interest) from the Qualified Counterparty. |
Governing Law; Jurisdiction: | The State of New York. |
Provision of Information: | The Loan parties authorize the Agent to provide to Qualified Counterparties all information related to the Collateral that the Agent is required or permitted to provide to the Lenders. The Agent shall not be prohibited in providing to the Secured Parties contact information and the amount of the respective Commitments and outstanding Obligations of the Secured Parties. |
Joinder: | Each new Qualified Counterparty that is party to a commodities-based Secured Hedge Contract will join the Qualified Commodity Hedge Intercreditor Agreement pursuant to joinder procedures to be included therein. |
Other Terms: | Such other terms as shall be reasonably satisfactory to the Agent and the Qualified Counterparty. |
Incorporated Terms: | To the extent any terms or provisions of any Loan Document are incorporated by reference into the Intercreditor Agreement, any modifications to such terms or provisions shall not apply in interpreting the Intercreditor Agreement to the extent such terms and provisions affect the rights and interests of the Qualified Counterparty, unless the Qualified Counterparty shall have consented to such modifications. |
Termination: | The Intercreditor Agreement will terminate as to any Qualified Counterparty on the later of (i) the date upon which all Secured Hedge Contracts with such Qualified Counterparty have been terminated or expired in accordance with their terms, and (ii) the date all Obligations in respect of such Secured Hedge Contracts have been satisfied. |