Arch Coal,Inc. (OTCMKTS:ACIIQ) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive
Agreement.
On March7, 2017, Arch Coal,Inc. (Arch Coal) entered into a new
senior secured term loan credit agreement in an aggregate
principal amount of $300 million (the New Term Loan Debt
Facility) with Credit Suisse AG, Cayman Islands Branch, as
administrative agent and collateral agent (in such capacities,
the Agent), and the other financial institutions from time to
time party thereto (collectively, the Lenders). Credit Suisse
Securities (USA) LLC and Citigroup Global Markets Inc. arranged
the New Term Loan Debt Facility.
The New Term Loan Debt Facility will mature on March7, 2024.
Borrowings under the New Term Loan Debt Facility bear interest at
a per annum rate equal to, at the option of Arch Coal, either
(i)a London interbank offered rate plus an applicable margin of
4%, subject to a 1% LIBOR floor (the LIBOR Rate), or (ii)a base
rate plus an applicable margin of 3%. Interest payments will be
payable in cash. The term loans provided under the New Term Loan
Debt Facility (the Term Loans) are subject to quarterly principal
amortization payments in an amount equal to $750,000.
The New Term Loan Debt Facility is guaranteed by all existing and
future wholly owned domestic subsidiaries of Arch Coal
(collectively, the Subsidiary Guarantors and, together with Arch
Coal, the Loan Parties), subject to customary exceptions, and is
secured by first priority security interests on substantially all
assets of the Loan Parties, including 50% of the voting equity
interests of directly owned domestic subsidiaries and 65% of the
voting equity interests of directly owned foreign subsidiaries,
subject to customary exceptions.
Arch Coal has the right to prepay Term Loans at any time and from
time to time in whole or in part without premium or penalty, upon
written notice, except that any prepayment of Term Loans that
bear interest at the LIBOR Rate other than at the end of the
applicable interest periods therefor shall be made with
reimbursement for any funding losses and redeployment costs of
the Lenders resulting therefrom.
The New Term Loan Debt Facility is subject to certain usual and
customary mandatory prepayment events, including 50% of net cash
proceeds of (i)debt issuances (other than debt permitted to be
incurred under the terms of the New Term Loan Debt Facility) and
(ii)non-ordinary course asset sales or dispositions, subject to
customary thresholds, exceptions and reinvestment rights.
The New Term Loan Debt Facility contains customary affirmative
covenants and representations.
The New Term Loan Debt Facility also contains customary negative
covenants, which, among other things, and subject to certain
exceptions, include restrictions on (i)indebtedness, (ii)liens,
(iii)liquidations, mergers, consolidations and acquisitions,
(iv)disposition of assets or subsidiaries, (v)affiliate
transactions, (vi)creation or ownership of certain subsidiaries,
partnerships and joint ventures, (vii)continuation of or change
in business, (viii)restricted payments, (ix)prepayment of
subordinated and junior lien indebtedness, (x)restrictions in
agreements on dividends, intercompany loans and granting liens on
the collateral, (xi)loans and investments, (xii)sale and
leaseback transactions, (xiii)changes in organizational documents
and fiscal year and (xiv)transactions with respect to bonding
subsidiaries. The New Term Loan Debt Facility does not contain
any financial maintenance covenant.
The New Term Loan Debt Facility permits the existing $200 million
trade accounts receivable securitization facility provided to
Arch Receivable Company, LLC, a special-purpose entity that is a
wholly owned subsidiary of Arch Coal, to remain in place.
The New Term Loan Debt Facility contains customary events of
default, subject to customary thresholds and exceptions,
including, among other things, (i)non-payment of principal and
non-payment of interest and fees, (ii)a material inaccuracy of a
representation or warranty at the time made, (iii)a failure to
comply with any covenant, subject to customary grace periods in
the case of certain affirmative covenants, (iv)cross-events of
default to indebtedness of at least $50,000,000, (v)cross-events
of default to surety, reclamation or similar bonds securing
obligations with an aggregate face amount of at least
$50,000,000, (vi)uninsured judgments in excess of $50,000,000,
(vii)any loan document shall cease to be a legal, valid and
binding agreement, (viii)uninsured losses
or proceedings against assets with a value in excess of
$50,000,000, (ix)ERISA events, (x)a change of control or
(xi)bankruptcy or insolvency proceedings relating to the Arch
Coal or any material subsidiary of the Arch Coal.
The description of the New Term Loan Debt Facility is qualified
in its entirety by reference to the full text of the New Term
Loan Debt Facility, which is incorporated by reference herein.
A copy of the New Term Loan Debt Facility is included herein as
Exhibit10.1.
On the effective date of the New Term Loan Debt Facility, all
outstanding obligations under Arch Coals previously existing
term loan credit agreement, dated as of October5, 2016, among
Arch Coal, as borrower, the lender party thereto and Wilmington
Trust, National Association, as administrative agent and
collateral agent (the Previous First Lien Debt Facility), other
than indemnification and other contingent obligations, were
paid in cash in full and the related transaction documents were
terminated (other than with respect to certain provisions that
customarily survive termination). All liens on property of Arch
Coal and the guarantors thereunder arising out of or related to
the Previous First Lien Debt Facility were terminated.
Item 1.02 Termination of a Material
Definitive Agreement.
The information regarding the Previous First Lien Debt Facility
set forth in Item 1.01 of this Current Report on Form8-K (the
Report) is incorporated by reference herein.
Item 2.03 Creation of a Direct
Financial Obligation or an Obligation under an Off-Balance
Sheet Arrangement of a Registrant.
The information regarding the New Term Loan Debt Facility set
forth in Item 1.01 of this Report is incorporated by reference
herein.
Item 7.01 Regulation FD
Disclosure.
On March7, 2017, Arch Coal issued two press releases announcing
(1)its increased equity ownership in Dominion Terminal
Associates and (2)the closing of its $300 million senior
secured term loan facility. Copies of the press releases are
attached hereto as Exhibits 99.1 and 99.2 and are incorporated
herein by reference.
The information set forth in this Item 7.01, including
Exhibits99.1 and 99.2, is being furnished and shall not be
deemed filed for purposes of Section18 of the Securities
Exchange Act of 1934, as amended (the Exchange Act) or
otherwise subject to the liabilities of that Section. The
information in this Item 7.01, including Exhibits99.1 and 99.2,
shall not be incorporated by reference into any filing under
the Securities Act of 1933, as amended, or the Exchange Act
except as shall be expressly set forth by specific reference in
such a filing.
Item 9.01 Financial Statements and
Exhibits.
(d) Exhibits
The following exhibits are attached hereto and filed herewith.
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Exhibit No. |
|
Description |
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10.1 |
Credit Agreement, dated as of March7, 2017, among Arch |
|
|
99.1 |
Press Release dated March7, 2017 |
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99.2 |
Press Release dated March7, 2017 |
About Arch Coal, Inc. (OTCMKTS:ACIIQ)
Arch Coal, Inc. is a coal producer. The Company is engaged in the production of thermal and metallurgical coal from surface and underground mines located throughout the United States, for sale to utility, industrial and steel producers both in the United States and around the world. The Company operates mining complexes in West Virginia, Kentucky, Maryland, Virginia, Illinois, Wyoming and Colorado. The Company’s segments include the Powder River Basin and Appalachia. The Powder River Basin segment includes operations in Wyoming. The Appalachia segment includes operations in West Virginia, Kentucky, Maryland and Virginia. The Company also sells coal from operations in Colorado and Illinois. Powder River Basin consists of Black Thunder and Coal Creek mines. The Company’s mines in Appalachia include Coal-Mac, Lone Mountain, Mountain Laurel, Beckley, Vindex, Sentinel and Leer. The Company operates, or contracts out the operation of approximately 10 active mines in the United States. Arch Coal, Inc. (OTCMKTS:ACIIQ) Recent Trading Information
Arch Coal, Inc. (OTCMKTS:ACIIQ) closed its last trading session 00.0000 at 0.0000 with shares trading hands.
