due March 31, 2018
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SECTION 1. AUTHORIZATION OF NOTES | 1 | |||
SECTION 2. Sale and Purchase of Notes | 1 | |||
SECTION 3. Closing | 1 | |||
SECTION 4. Conditions to Closing | 2 | |||
Section 4.1 Representations and Warranties | 2 | |||
Section 4.2 Performance; No Default | 2 | |||
Section 4.3 Compliance Certificates | 2 | |||
Section 4.4 Opinions of Counsel | 3 | |||
Section 4.5 Purchase Permitted By Applicable Law, Etc. | 4 | |||
Section 4.6 Sale of Other Notes | 4 | |||
Section 4.7 Payment of Special Counsel Fees | 4 | |||
Section 4.8 Private Placement Number | 4 | |||
Section 4.9 Changes in Corporate Structure | 5 | |||
Section 4.10 Bankruptcy Remote Entities; Separateness | 5 | |||
Section 4.11 Subordination Agreements | 5 | |||
Section 4.12 Security Documents; Recording | 5 | |||
Section 4.13 Delivery of Pledged Collateral | 5 | |||
Section 4.14 Mortgage Support Documents | 5 | |||
Section 4.15 Bank Financing Documents | 6 | |||
Section 4.16 Intercreditor Agreement | 6 | |||
Section 4.17 Insurance; Certificates of Insurance; Endorsements | 6 | |||
Section 4.18 Solvency Certificate | 6 | |||
Section 4.19 Proceedings and Documents | 6 | |||
Section 4.20 Management Agreement | 6 | |||
Section 4.21 Consents | 7 | |||
Section 4.22 Retirement of Certain Debt | 7 | |||
Section 4.23 Funding Instructions | 7 | |||
Section 4.24 No Material Adverse Change | 7 | |||
Section 4.25 No Material Litigation | 7 | |||
Section 4.26 Disclosure of Contingent Liabilities | 8 | |||
Section 4.27 Projected Consolidated Financials | 8 | |||
Section 4.28 NRGT Documents | 8 | |||
SECTION 5. Representations and Warranties of the Company and the Guarantors | 8 | |||
Section 5.1 Organization and Qualification | 8 | |||
Section 5.2 Capitalization and Ownership | 9 | |||
Section 5.3 Subsidiaries | 9 | |||
Section 5.4 Power and Authority | 9 | |||
Section 5.5 Validity and Binding Effect | 9 | |||
Section 5.6 No Conflict | 10 |
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Section 5.7 Litigation | 10 | |||
Section 5.8 Title to Properties | 10 | |||
Section 5.9 Financial Statements | 11 | |||
Section 5.10 Use of Proceeds; Margin Stock | 12 | |||
Section 5.11 Disclosure | 12 | |||
Section 5.12 Taxes | 13 | |||
Section 5.13 Consents and Approvals | 13 | |||
Section 5.14 No Event of Default; Compliance with Instruments | 13 | |||
Section 5.15 Patents, Trademarks, Copyrights, Licenses, Etc. | 14 | |||
Section 5.16 Security Interests | 14 | |||
Section 5.17 Mortgage Liens | 14 | |||
Section 5.18 Status of the Pledged Collateral | 15 | |||
Section 5.19 Insurance | 15 | |||
Section 5.20 Compliance with Laws | 15 | |||
Section 5.21 Material Contracts; Burdensome Restrictions | 15 | |||
Section 5.22 Status Under Certain Statutes | 16 | |||
Section 5.23 Plans and Benefit Arrangements | 16 | |||
Section 5.24 Employment Matters | 17 | |||
Section 5.25 Environmental Matters | 18 | |||
Section 5.26 Senior Debt Status | 19 | |||
Section 5.27 Coal Leases | 20 | |||
Section 5.28 Transactions with Affiliates | 20 | |||
Section 5.29 Permit Blocks | 20 | |||
Section 5.30 Qualifications as Lessee; Coal Acreage Limitations | 20 | |||
Section 5.31 Private Offering by the Company | 20 | |||
Section 5.32 Foreign Assets Control Regulations, Etc. | 21 | |||
Section 5.33 Additional Representations and Warranties | 21 | |||
Section 5.34 Pari Passu Collateral | 21 | |||
Section 5.35 Single Purpose Entities | 21 | |||
Section 5.36 Surface Mine Reclamation Bonds | 24 | |||
SECTION 6. Representations of Purchasers | 24 | |||
Section 6.1 Purchase For Investment | 24 | |||
Section 6.2 Source of Funds | 25 | |||
Section 6.3 Exemption from Withholding | 26 | |||
SECTION 7. Information as to the Obligors | 27 | |||
Section 7.1 Reporting | 27 | |||
Section 7.2 Visitation | 32 | |||
SECTION 8. Payment and Prepayment of the Notes | 32 | |||
Section 8.1 Regularly Scheduled Prepayments; Payment at Final Maturity | 32 | |||
Section 8.2 Optional Prepayments with Make-Whole Amount | 33 | |||
Section 8.3 Required Prepayment of Notes Upon Prepayment Event | 33 | |||
Section 8.4 Allocation of Certain Partial Prepayments | 34 | |||
Section 8.5 Maturity; Surrender, etc. | 34 | |||
Section 8.6 Purchase of Notes | 35 |
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Section 8.7 Make-Whole Amount | 35 | |||
SECTION 9. Affirmative Covenants | 36 | |||
Section 9.1 Miscellaneous Affirmative Covenants | 36 | |||
Section 9.2 Subsidiaries; Additional Security Arrangements | 46 | |||
SECTION 10. Negative and Financial Covenants | 48 | |||
Section 10.1 Indebtedness | 48 | |||
Section 10.2 Liens | 49 | |||
Section 10.3 Guaranties | 49 | |||
Section 10.4 Loans and Investments | 49 | |||
Section 10.5 Dividends and Related Distributions | 50 | |||
Section 10.6 Liquidations, Mergers, Consolidations, Acquisitions | 52 | |||
Section 10.7 Dispositions of Assets or Subsidiaries | 53 | |||
Section 10.8 Affiliate Transactions | 53 | |||
Section 10.9 Subsidiaries, Partnerships and Joint Ventures | 54 | |||
Section 10.10 Continuation of or Change in Business | 54 | |||
Section 10.11 Plans and Benefit Arrangements | 54 | |||
Section 10.12 Fiscal Year | 55 | |||
Section 10.13 Issuance of Stock | 55 | |||
Section 10.14 Changes in Organizational Documents | 55 | |||
Section 10.15 Changes in Material Contracts, Performance under Coal Supply Contracts | 55 | |||
Section 10.16 Capital Expenditures and Leases | 56 | |||
Section 10.17 Minimum Debt Service Coverage Ratio | 56 | |||
Section 10.18 Maximum Leverage Ratio | 56 | |||
SECTION 11. Events of Default | 56 | |||
SECTION 12. Remedies on Default, etc. | 59 | |||
Section 12.1 Acceleration | 59 | |||
Section 12.2 Other Remedies | 60 | |||
Section 12.3 Rescission | 60 | |||
Section 12.4 No Waivers or Election of Remedies, Expenses, etc. | 61 | |||
SECTION 13. Registration; Exchange; Substitution of Notes | 61 | |||
Section 13.1 Registration of Notes | 61 | |||
Section 13.2 Transfer and Exchange of Notes | 61 | |||
Section 13.3 Replacement of Notes | 62 | |||
SECTION 14. Payments on Notes | 62 | |||
Section 14.1 Place of Payment | 62 | |||
Section 14.2 Home Office Payment | 62 | |||
SECTION 15. Expenses, Etc. | 63 | |||
Section 15.1 Transaction Expenses | 63 | |||
Section 15.2 Survival | 63 |
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SECTION 16. Survival of Representations and Warranties; Entire Agreement | 64 | |||
SECTION 17. Amendment and Waiver | 64 | |||
Section 17.1 Requirements | 64 | |||
Section 17.2 Solicitation of Holders of Notes | 64 | |||
Section 17.3 Binding Effect, etc. | 65 | |||
Section 17.4 Notes Held by an Obligor, etc. | 65 | |||
SECTION 18. Notices | 65 | |||
SECTION 19. Reproduction of Documents | 66 | |||
SECTION 20. Confidential Information | 66 | |||
SECTION 21. Substitution of a Purchaser | 67 | |||
SECTION 22. Miscellaneous | 68 | |||
Section 22.1 Successors and Assigns | 68 | |||
Section 22.2 Set Off | 68 | |||
Section 22.3 Payments Due on Non-Business Days | 68 | |||
Section 22.4 Severability | 68 | |||
Section 22.5 Construction | 69 | |||
Section 22.6 Counterparts | 69 | |||
Section 22.7 Governing Law | 69 | |||
Section 22.8 Withholding | 69 | |||
Section 22.9 Environmental Indemnity | 70 | |||
Section 22.10 Jurisdiction And Process | 71 | |||
Section 22.11 Waiver Of Jury Trial | 72 |
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Schedule A | — | Information Relating to Purchasers | ||
Schedule B | — | Definitions | ||
Schedule 1.1(L) | — | Coal Leases | ||
Schedule 5.1 | — | Organization and Qualification | ||
Schedule 5.2 | — | Capitalization and Ownership | ||
Schedule 5.3 | — | Subsidiaries | ||
Schedule 5.7 | — | Litigation | ||
Schedule 5.8 | — | Owned and Leased Property | ||
Schedule 5.9 | — | Financial Statements | ||
Schedule 5.12 | — | Tax Matters | ||
Schedule 5.13 | — | Consents and Approvals | ||
Schedule 5.15 | — | Patents, Trademarks, Copyrights, Licenses, Etc. | ||
Schedule 5.18 | — | Status of the Pledged Collateral | ||
Schedule 5.19 | — | Insurance Policies | ||
Schedule 5.21 | — | Material Leases, Contracts, Etc. | ||
Schedule 5.23 | — | Employee Benefit Plan Disclosures | ||
Schedule 5.25 | — | Environmental Matters | ||
Schedule 5.27 | — | Coal Lease Royalties | ||
Schedule 5.28 | — | Transactions with Affiliates | ||
Schedule 5.30 | — | Qualifications as Lessee | ||
Schedule 8.1 | — | Regularly Scheduled Prepayments | ||
Schedule 10.1 | — | Existing Indebtedness | ||
Schedule 10.3 | — | Guaranteed TWCC Lease Obligations | ||
Schedule 10.16 | — | Capital Expenditures and Leases | ||
Exhibit 1 | — | Form of Note | ||
Exhibit 4.4 | — | Matters for Opinion of Counsel | ||
Exhibit 7.1(d) | — | Form of Compliance Certificate | ||
Exhibit 7.1(l) | — | Fiscal Year Reports | ||
Exhibit (C)(1) | — | Form of Collateral Assignment | ||
Exhibit (G)(1) | — | Form of Guarantor Joinder Agreement | ||
Exhibit (G)(2) | — | Form of Guaranty Agreement | ||
Exhibit (I)(1) | — | Form of Intercompany Subordination Agreement | ||
Exhibit (I)(2) | — | Form of Intercreditor Agreement | ||
Exhibit (M)(1) | — | Form Management Fee Subordination Agreement | ||
Exhibit (M)(2) | — | Form of Mortgage | ||
Exhibit (P)(1) | — | Form of Patent, Trademark and Copyright Security Agreement | ||
Exhibit (P)(2) | — | Form of Pledge Agreement | ||
Exhibit (S)(1) | — | Form of Security Agreement |
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2 North Cascade Avenue
Colorado Springs, Colorado 80903
Schedule AAttached Hereto
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SECTION 5. | REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE GUARANTORS. |
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Period | Ratio | |||
Closing Date through June 30, 2010 | 3.00 to 1.00 | |||
July 1, 2010 through December 31, 2010 | 2.75 to 1.00 | |||
January 1, 2011 through December 31, 2011 | 2.50 to 1.00 | |||
January 1, 2012 through December 31, 2012 | 2.25 to 1.00 | |||
January 1, 2013 and thereafter | 1.50 to 1.00 |
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Very truly yours, WESTMORELAND MINING LLC | ||||
By: | /s/ Douglas P. Kathol | |||
Title: Douglas P. Kathol | ||||
Name: Vice President | ||||
WESTERN ENERGY COMPANY, as a Guarantor | ||||
By: | /s/ Douglas P. Kathol | |||
Title: Douglas P. Kathol | ||||
Name: Vice President | ||||
DAKOTA WESTMORELAND CORPORATION, as a Guarantor | ||||
By: | /s/ Douglas P. Kathol | |||
Title: Douglas P. Kathol | ||||
Name: Vice President | ||||
WESTMORELAND SAVAGE CORPORATION, as a Guarantor | ||||
By: | /s/ Douglas P. Kathol | |||
Title: Douglas P. Kathol | ||||
Name: Vice President | ||||
to as of the date thereof.
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA | ||||
By | /s/ Lisa M. Ferraro | |||
Title Director | ||||
NEW YORK LIFE INSURANCE COMPANY | ||||
By | /s/ Kathleen A. Haberkern | |||
Title: Corporate Vice President | ||||
NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION | ||||
By: New York Life Investment Management | ||||
LLC, Its Investment Manager | ||||
By | /s/ Kathleen A. Haberkern | |||
Title: Director | ||||
NATIONWIDE MUTUAL FIRE INSURANCE COMPANY | ||||
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY | ||||
NATIONWIDE LIFE INSURANCE COMPANY | ||||
By | /s/ Thomas A. Gleason | |||
Title: Authorized Signatory |
PRINCIPAL LIFE INSURANCE COMPANY | ||||
By: | Principal Global Investors, LLC A Delaware limited liability Company, its authorized signatory | |||
By | /s/ Alan P. Kress | |||
Title: Counsel | ||||
By | /s/ James C. Fifield | |||
Title: Assistant General Counsel | ||||
GENWORTH LIFE AND ANNUITY INSURANCE COMPANY | ||||
By | /s/ Estelle Simsolo | |||
Title: Investment Officer | ||||
GENWORTH LIFE INSURANCE COMPANY OF NEW YORK | ||||
By | /s/ Estelle Simsolo | |||
Title: Investment Officer | ||||
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY | ||||
By: | Babson Capital Management LLC As Investment Adviser | |||
By | /s/ Emeka O. Onukwugha | |||
Title: Managing Director |
C.M. LIFE INSURANCE COMPANY | ||||||
By: | Babson Capital Management LLC As Investment Sub-Advisor | |||||
By | /s/ Emeka O. Onukwugha | |||||
Title: Managing Director |
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Payment Dates | Amount | |
each Payment Date occurring during the years 2008 and 2009 | $1,000,000 | |
each Payment Date occurring during the year 2010 | $750,000 |
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each Payment Date occurring during the year 2011 and thereafter | $1,000,000, or such lesser amount as shall cause the aggregate amount of Retained Cash retained by the Company to equal the Retained Cash Limit with respect to such Payment Date |
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