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Exhibit 10.13
AMENDMENT NO. 3 AND WAIVER
AMENDMENT No. 3 AND WAIVER (this "Amendment and
Waiver") dated as of November 7, 2006, to the CREDIT AGREEMENT
dated as of May 3l, 2005, as amended by that certain Amendment No.
1 and Waiver dated February 22, 2006, as further amended by that
certain Amendment No. 2 and Waiver dated May 30, 2006 (as may be
further amended, restated, modified or replaced, the "Credit
Agreement"), among JAMES RIVER COAL COMPANY (the "Borrower"), the
LENDERS from time to time party thereto, PNC BANK, NATIONAL
ASSOCIATION, as Administrative Agent.
A. Pursuant to the Credit Agreement, the Lenders
have extended credit to the Borrower, and have agreed to extend
credit to the Borrower, in each case pursuant to the terms and
subject to the conditions set forth therein.
B. The Borrower has requested that the Lenders
agree to waive and amend certain provisions of the Credit
Agreement, in each case pursuant to the terms and subject to the
applicable conditions set forth herein.
C. The undersigned Lenders are willing, pursuant
to the terms and subject to the applicable conditions set forth
herein, to grant such waivers and approve such
amendments.
D. Capitalized terms used but not defined herein
shall have the respective meanings assigned to them in the Credit
Agreement (as amended hereby).
Accordingly, in consideration of the mutual
agreements herein contained and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, and subject to the applicable conditions set forth
herein, the parties hereto hereby agree as follows:
SECTION 1. Waivers . Subject to the
applicable conditions set forth herein, the undersigned Lenders
hereby waive compliance with Sections 6.12 [Fixed Charge Covenant
Ratio], Section 6.13 [Leverage Ratio] and Section 6.14 [Senior
Secured Leverage Ratio] for the period from September 30, 2006, to
and including December 30, 2006.
SECTION 2. Amendment of the Definition of
Applicable Rate . The defined term "Applicable Rate" contained
in Section 1.01 [Defined Terms] of the Credit Agreement is amended
by adding the following sentence at the end of the definition
thereto:
"Notwithstanding anything herein to the contrary,
from October 1, 2006 and thereafter, the Applicable Rate with
respect to the Loan ABR Spread shall be 2.50% and the Applicable
Rate with respect to the Loan Eurodollar Spread shall be
3.50%."
SECTION 3. Amendment of the Definition of Pro
Forma Basis . The defined term "Pro Forma Basis" contained in
Section 1.01 [Defined Terms] of the Credit Agreement is amended by
replacing the phrase "Sections 6.12, 6.13, 6.14 and 6.15" with the
phrase "Sections 6.12, 6.13, 6.14, 6.15, 6.18 and 6.19."
SECTION 4. Amendment of Section 1.01[Defined
Terms] . Section 1.01 [Defined Terms] of the Credit Agreement
is amended by inserting the following new definition into Section
1.01 in alphabetical order thereto:
"" Liquidity " means the sum of the
Borrower’s liquid assets at any time in the form of (a) cash
on hand, (b) cash equivalents, (c) marketable securities traded on
a national exchange or on NASDAQ and (d) the difference between the
Revolving Commitment and the Revolving Exposure."
SECTION 5. Amendment of Section 2.12(c) .
Section 2.12(c) is amended by adding the following sentence at the
end of the paragraph:
"Notwithstanding anything contrary contained in
the Credit Agreement, the interest rate referenced in Section
2.12(c)(i)(a) shall increase to 3.50% for the period commencing on
October 1, 2006 and thereafter."
SECTION 6. Amendment of Article VI [Negative
Covenants] . Article VI [Negative Covenants] of the
Credit Agreement is hereby amended by adding the following Section
6.18 thereto:
"SECTION 6.18. Minimum Consolidated EBITDA
. The Borrower shall generate Consolidated EBITDA in an amount
greater than or equal to $8,000,000 for the fiscal quarter ending
September 30, 2006."
SECTION 7. Amendment of Article VI [Negative
Covenants] . Article VI [Negative Covenants] of the
Credit Agreement is hereby amended by adding the following Section
6.19 thereto:
"SECTION 6.19. Minimum Liquidity . The
Borrower shall not permit Liquidity to be less than $7,500,000.00
at any time, including on a Pro Forma Basis prior to the Borrower
making the December 1, 2006 interest payment on the Senior
Notes."
SECTION 8. Representations and Warranties
. The Borrower represents and warrants to the Administrative Agent
and the Lenders that:
(a) This Amendment and Waiver has been duly
authorized, executed and delivered by the Borrower and constitutes
a legal, valid and binding obligation of the Borrower, enforceable
in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting
creditors’ fights generally and subject to general principles
of equity, regardless of whether considered in a proceeding in
equity or at law.
(b) None of the execution, delivery or
performance by the Borrower of this Amendment and Waiver or the
compliance by the Borrower with the terms and provisions hereof (i)
will contravene any material provision of any applicable law,
statute, rule or regulation, or any order, writ, injunction or
decree of any Governmental Authority, (ii) will conflict or be
inconsistent with, or result in any breach of, any of the terms,
covenants, conditions or provisions of, or constitute a default
under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property
or assets of Borrower or any of its respective Subsidiaries
pursuant to the terms of any indenture, mortgage, deed of trust,
loan agreement, credit agreement or any other material agreement or
instrument to which Borrower or any of its respective Subsidiaries
is a party or by which Borrower or any of its respective
Subsidiaries or any of the property or assets of Borrower or any of
its respective Subsidiaries are bound or to which Borrower or any
of its respective Subsidiaries may be subject or (iii) will violate
any provision of the certificate or articles of incorporation,
by-laws, certificate of partnership, par
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