Pursuant to 17 CFR 240.24b-2, confidential information (indicated by [***]) has been omitted from this exhibit and has been filed separately with the Securities and Exchange Commission pursuant to a Confidential Treatment Application filed with the Commission.
 
Exhibit 4.3
 
 
 
 
Agreement
   
Poplar Grove Coal Mine
 
   
Project facility agreement
 
 
Hartshorne Mining Group, LLC. (as Borrower)
 
Paringa Resources Limited (as Parent)
 
Each party listed in Schedule 1 (as Guarantors)
 
Macquarie Bank Limited (as Original Lender, Agent and Security Trustee)
 
 
Project facility agreement
page 1

 
   
Contents
     
Table of contents   
     
1
Definitions and interpretation
8
     
1.1
Agreement components
8
1.2
Definitions
8
1.3
Interpretation
53
1.4
Inclusive expressions
55
1.5
Business Day
55
1.6
PPSA incorporated definitions
55
1.7
Original Lender
55
1.8
Accounting Standards
55
1.9
Security Trustee’s limitation of liability protection
55
     
2
Conditions precedent
56
     
2.1
Conditions precedent to Financial Close
56
2.2
Conditions precedent to Tranche One
61
2.3
Conditions precedent to Tranche Two
61
2.4
Conditions precedent to all Funding Portions
62
2.5
Certified copies
62
2.6
Benefit of conditions precedent
62
     
3
Commitment, purpose and availability of Project Loan Facility
62
     
3.1
Provision of Commitment
62
3.2
Several obligations and rights of Lenders
63
3.3
Purpose
63
3.4
Cancellation of Commitment during Availability Period
63
3.5
Cancellation at end of Availability Period
63
3.6
Voluntary prepayment
63
3.7
Prepayment date
64
3.8
Mandatory prepayment – exercise of Option
64
3.9
Mandatory prepayment – Equity Cure
65
3.10
Mandatory prepayment – Compulsory acquisition
65
     
4
Funding and rate setting procedures
65
     
4.1
Delivery of Funding Notice
65
4.2
Requirements for a Funding Notice
65
4.3
Irrevocability of Funding Notice
65
4.4
Number of Funding Portions
65
4.5
Amount of Funding Portions
65
4.6
Funding Periods
66
4.7
Consolidation and division of Funding Portions under Project Loan Facility
66
4.8
Determination of Funding Rate
66
4.9
Market disruption – Project Loan Facility
66
4.10
Alternative basis of interest or funding
67
4.11
Agent’s role and confidentiality
67
4.12
Prepayment of Affected Lender
68
     
5
Project Loan Facility
68
 
Project facility agreement
page 1

 
5.1
Provision of Funding Portions
68
5.2
Payment to Borrower
68
5.3
Repayment
68
5.4
Interest
69
     
6
Payments
69
     
6.1
Manner of payment
69
6.2
Payments on a Business Day
70
6.3
Payments in gross
70
6.4
Additional payments
70
6.5
Taxation deduction procedures
70
6.6
Tax Credit
70
6.7
Tax affairs
71
6.8
FATCA Deduction
71
6.9
FATCA Information
71
6.10
Amounts payable on demand
72
6.11
Appropriation of payments
72
6.12
Distribution by Agent
73
6.13
Non‑receipt of funds by Agent
73
6.14
Redistribution of payments
73
6.15
Rounding
74
6.16
Currency exchanges
74
     
7
Representations and warranties
74
     
7.1
Representations and warranties
74
7.2
Survival and repetition of representations and warranties
80
7.3
Reliance by Finance Parties
80
     
8
Undertakings
80
     
8.1
Provision of information and reports
80
8.2
Proper accounts
81
8.3
Notices to the Agent
81
8.4
Compliance
82
8.5
Maintenance of capital
82
8.6
Compliance with laws and Authorisations
83
8.7
Payment of Taxes and outgoings
83
8.8
Project Documents
84
8.9
Amendments to constitution; maintenance of corporate existence
85
8.10
Negative pledge and Disposal of assets
86
8.11
Financial Indebtedness
87
8.12
No change to business
87
8.13
Financial accommodation
87
8.14
Restrictions on dealings
87
8.15
Restrictions on acquisitions, investments and capital expenditures
87
8.16
Subsidiaries
87
8.17
Restricted Payments
87
8.18
Secured Property
88
8.19
Insurance
89
8.20
Key personnel
91
8.21
Conduct of Project
91
8.22
Hedging
92
8.23
Inspection and assistance
92
8.24
Financial undertakings
93
8.25
Additional Equity
94
8.26
Consent to security
94
8.27
Term of undertakings
95
 
Project facility agreement
page 2

 
9
Options
95
     
9.1
Issue of Options
95
9.2
Option exercise
95
9.3
Option terms
96
     
10
Forecast Documents
96
     
10.1
Price Determination Mechanism
96
10.2
Calculations
97
10.3
Calculations in Dollars
97
10.4
Maintenance
97
10.5
Update of Forecast Documents
98
10.6
Factors since commencement of production
98
10.7
Determination is binding
98
     
11
Accounts and proceeds
99
     
11.1
Establishment and maintenance of Accounts
99
11.2
Proceeds Account
100
11.3
Lock up, Restricted Payment and management fees
101
11.4
Operating Accounts
101
11.5
Restricted Accounts
102
12
Events of Default
102
12.1
Events of Default
102
12.2
Effect of Event of Default
106
12.3
Obligors to continue to perform
106
12.4
Enforcement
107
12.5
Review Event
107
     
13
Increased costs and illegality
108
     
13.1
Increased costs
108
13.2
Illegality
109
13.3
Minimisation
109
     
14
Guarantee and indemnity
109
     
14.1
Guarantee
109
14.2
Payment
109
14.3
Securities for other money
110
14.4
Amount of Secured Moneys
110
14.5
Proof by Agent
110
14.6
Avoidance of payments
110
14.7
Indemnity for avoidance of Secured Moneys
111
14.8
No obligation to marshal
111
14.9
Non‑exercise of Guarantors’ rights
111
14.10
Principal and independent obligation
112
14.11
Suspense account
112
14.12
Unconditional nature of obligations
112
14.13
No competition
114
14.14
Continuing guarantee
115
14.15
Variation
115
14.16
Judgments
115
     
15
Indemnities and Break Costs
115
     
15.1
General indemnity
115
15.2
Break Costs
116
15.3
Foreign currency indemnity
116
15.4
Conversion of currencies
116
 
Project facility agreement
page 3

 
15.5
Continuing indemnities and evidence of loss
117
     
16
Fees, Tax, costs and expenses
117
     
16.1
Agent’s fees
117
16.2
Security Trustee’s fees
117
16.3
Lenders’ fees
117
16.4
Project Loan Facility Line Fee
117
16.5
Tax
118
16.6
Costs and expenses
118
16.7
GST
118
     
17
Interest on overdue amounts
119
     
17.1
Payment of interest
119
17.2
Accrual of interest
119
17.3
Rate of interest
119
     
18
Relations between Agent and Lender
119
     
18.1
Appointment of Agent
119
18.2
Agent’s capacity
120
18.3
Agent’s obligations
120
18.4
Agent’s powers
120
18.5
Instructions to Agent
120
18.6
Assumptions as to authority
121
18.7
Agent’s liability
121
18.8
Delegation
122
18.9
Agent entitled to rely
122
18.10
Provision of information
122
18.11
Indemnity by Lenders
123
18.12
Independent appraisal by Lenders
123
18.13
Resignation and removal of Agent
123
18.14
Institution of actions by Lenders
124
18.15
Identity of Lenders
124
18.16
Electronic transmission of notices
124
18.17
Security Trustee’s capacity
125
18.18
Disclosure of Information by Lenders
125
     
19
Assignment and substitution
125
     
19.1
Assignment by Obligor
125
19.2
Assignment by Lenders
125
19.3
Substitution certificate
125
19.4
Assist
126
19.5
Securitisation Permitted
126
19.6
Participation permitted
126
19.7
Lending Office
126
19.8
No increase in costs
127
     
20
Saving provisions
127
     
20.1
No merger of security
127
20.2
Exclusion of moratorium
127
20.3
Exclusion of PPSA provisions
127
20.4
Conflict
128
20.5
Consents
128
20.6
Principal obligations
128
20.7
Non‑avoidance
128
20.8
Set‑off authorised
129
20.9
Agent’s certificates and approvals
129
 
Project facility agreement
page 4

 
20.10
No reliance or other obligations and risk assumption
129
20.11
Power of attorney
129
     
21
General
130
     
21.1
Confidential information and publicity
130
21.2
Obligor to bear cost
131
21.3
Notices
131
21.4
Governing law and jurisdiction
131
21.5
Prohibition and enforceability
131
21.6
Waivers
132
21.7
Variation
132
21.8
Cumulative rights
132
21.9
Attorneys
132
21.10
Counterparts
132
21.11
Process agent
132
 
Schedules
 
   
Schedule 1
 
Guarantors
135
   
Schedule 2
 
Lenders and Commitments
137
   
Schedule 3
 
Notice details
138
   
Schedule 4
 
Officer’s certificate for entities incorporated in Australia
140
Officer’s certificate for entities incorporated in the United States of America
142
   
Schedule 5
 
Funding Notice
146
   
Schedule 6
 
Group Structure Diagram
148
   
Schedule 7
 
Compliance Certificate
149
   
Schedule 8
 
Repayments
151
 
Project facility agreement
page 5

 
 
Schedule 9
 
 
Schedule 10
 
Part 1 - Project Tenements and Project Owned Property
160
   
Schedule 11
 
Material Authorisations
191
   
Schedule 12
 
Project Documents
193
   
Schedule 13
 
[***]
194
   
Schedule 14
 
Map of Project Area, Cypress Project Area and Dock Area
199
   
Signing page
201
   
Attachment 1
Substitution certificate
 
 
 
Project facility agreement
page 6

 
 
 
 
 Project facility agreement
 
 
     
   Date ►  17 May 2018  
     
 
Between the parties
 
 
 
 
Borrower
 
 
Hartshorne Mining Group, LLC
 
(Borrower)
 
 
 
Parent
 
 
Paringa Resources Limited
 
(Parent)
 
 
 
Guarantors
 
 
Each party listed in Schedule 1
 
 
 
Original Lender
 
 
Macquarie Bank Limited
 
ABN 46 008 583 542
 
(Lender)
 
 
 
Agent and Security Trustee
 
 
Macquarie Bank Limited
 
ABN 46 008 583 542
 
(Agent and Security Trustee)
 
 
 
Background
 
 
The Lenders have agreed to provide the Facility to the Borrower on the terms of this agreement.
 
 
 
The parties agree
 
 
as set out in the Operative part of this agreement, in consideration of, among other things, the mutual promises contained in this agreement.
 
 
1
Definitions and interpretation

1
Definitions and interpretation

Project facility agreement
page 7

1    Definitions and interpretation 
 
1
Definitions and interpretation

 
1.1
Agreement components

This agreement includes any schedule.

1.2
Definitions

The meanings of the terms used in this document are set out below.
 
 
 
Term
 
 
Meaning
 
 
 
Account Bank
 
 
1 Macquarie Bank Limited ABN 46 008 583 542;
 
2 Old National Bank, provided that it has entered into an Account Bank Deed; or
 
3 any bank or financial institution approved by the Agent which has entered into an Account Bank Deed.
 
 
 
Account Bank Deed
 
 
an account bank agreement or deed in favour of the Security Trustee on terms acceptable to the Agent.
 
 
 
Accounting Standards
 
 
generally accepted accounting principles in Australia.
 
 
 
Accounts
 
 
1 the Proceeds Account; and
 
2 the Operating Accounts.
 
 
 
Additional Requirements
 
 
has the meaning given to it in clause 12.5.
 
 
 
AEP Supply Contact
 
 
[***]
 
 
Project facility agreement
page 8

1    Definitions and interpretation 
 
 
Annual Construction and Operating Budget
 
the consolidated construction and operating budget for the Project in form and substance satisfactory to the Agent which:
 
1 is approved by the board of directors of the Borrower;
 
2 is to be provided initially in accordance with clause 2.1(m), as updated and amended from time to time as required under clause 10.5 and in accordance with clause 10.4(b)(1);
 
3 reflects the next calendar year and is broken down into monthly periods;
 
4 is based on the Resources and Reserves Statement;
 
5 sets out in detail the information and amounts described in the Life of Mine Plan and the Base Case Financial Model; and
 
6 prior to Completion, includes a detailed monthly Cost to Complete analysis and forecast schedule for the withdrawal of funds from the Proceeds Account.
 
The Lenders may in their discretion elect to accept receipt of the Annual Construction and Operating Budget as incorporated in, and part of, the Base Case Financial Model.
 
 
 
Annual Corporate Budget
 
 
the corporate budget for the Parent and its consolidated group entities in form and substance satisfactory to the Agent which:
 
1 is approved by the board of directors of the Parent;
 
2 is to be provided initially in accordance with clause 2.1(l), as updated and amended from time to time as required under clause 10.5 and in accordance with clause 10.4(b)(1);
 
3 reflects the next calendar year and is broken down into monthly periods;
 
4 separates Australian and US expenditures; and
 
5 is consistent with the Annual Construction and Operating Budget, the Life of Mine Plan and the Base Case Financial Model.
 
The Lenders may in their discretion elect to accept receipt of the Annual Corporate Budget as incorporated in, and part of, the Base Case Financial Model.
 
 
 
Approved US Stock Exchange
 
 
any US stock exchange approved by the Agent.
 
 
 
Associate
 
 
an associate as defined in section 11 of the Corporations Act.
 
Project facility agreement
page 9

1    Definitions and interpretation 

 
 
ASX Rules
 
 
means each of:
 
1 the ASX Listing Rules;
 
2 ASX Operating Rules;
 
3 ASX Clear Operating Rules; and
 
4 ASX Settlement Operating Rules,
 
each published and distributed by ASX Limited.
 
 
 
Attorney
 
an attorney appointed under a Finance Document.
 
 
Australian Obligor
 
1 Paringa Resources Limited (ABN 44 155 933 010);
 
2 Hartshorne Coal Mining Pty Ltd (ABN 95 155 302 211); and
 
3 HCM Resources Pty Ltd (ABN 35 155 327 521).
 
 
 
Authorisation
 
 
 
 
1 any consent, registration, filing, agreement, notice of non‑objection, notarisation, certificate, licence, approval, permit, authority or exemption; or
 
2 in relation to anything which a Government Agency may prohibit or restrict within a specific period, the expiry of that period without intervention or action or notice of intended intervention or action,
 
and includes any consent, registration, agreement, licence, approval, permit or authority which is described in the definitions of Project Tenement and Cypress Project Tenement.
 
   
Available Funding
 
funds available to the Borrower for the development of the Project and the achievement of Completion, being the aggregate of:
 
1 the aggregate of the Total Undrawn Tranche One Commitments and Total Undrawn Tranche Two Commitments at that time;
 
2 the balance in the Proceeds Account at that time;
 
3 the amount of any other funding source approved by the Agent;
 
4 any insurance proceeds payable to the Obligors in relation to loss or damage to property, delay in start-up or business interruption which has not been paid, provided the claim has been accepted by the insurer in writing and the Agent is satisfied (acting reasonably) that the claim will be paid on a fixed date and in time to meet scheduled Project Costs, Construction Costs and Financing Costs; and
 
5 (a)        subject to paragraph 5(b) below, any revenue amounts that are projected in the Base Case Financial Model to be received by the Borrower in respect of the Project prior to scheduled Date for Completion; and
 
      (b)        in the event that any Cost to Complete Schedule
 
Project facility agreement
page 10

1    Definitions and interpretation 
 
   
indicates that Completion will not be achieved by the scheduled Date for Completion, the Available Funding will only include such revenue amounts that are projected in the Base Case Financial Model to be received by the Borrower that the Lenders’ Technical Expert confirms are consistent with the forecast ramp-up schedule and working capital requirements of the Project based on that Cost to Complete Schedule, and taking into account the performance actually achieved at the Project at that time.
 
 
 
Availability Period
 
 
1 in respect of Tranche One, the period commencing on the date on which all of the conditions precedent set out in clause 2.2 are satisfied or waived by the Agent in writing and ending on the earlier of:
 
     ●   31 August 2018; and
 
●   the date on which the Tranche One Commitment is cancelled in full under this agreement; and
 
2 in respect of Tranche Two, the period commencing on the date on which all of the conditions precedent set out in clause 2.3 are satisfied or waived by the Agent in writing and ending on the earlier of:
 
 ●  if the Condition Precedent to Tranche Two set out in section 2.3(b) is not satisfied by 31 October 2018, 31 October 2018;
 
 if the Condition Precedent to Tranche Two set out in section 2.3(b) is satisfied by 31 October 2018, 31 December 2018; and
 
●   the date on which the Tranche Two Commitment is cancelled in full under this agreement.
 
 
Bank Feasibility Study
 
 
the updated bank feasibility study for the Project based on mining the Number 9 Seam.
 
 
 
Base Case Financial Model and BCFM
 
 
the pro forma computer spreadsheet financial model which is prepared to carry out the financial assessment of the Project and which:
 
1 is based on mining the Number 9 Seam;
 
2 is in form and substance satisfactory to the Agent;
 
3 is approved by the Board of the Borrower;
 
4 contains projections of mine level physicals, revenue, expenses, cash flows, compliance with clause 8.24 and sources and uses of funds analysis for the Project over a period ending no sooner than the last year of production in accordance with the LOMP;
 
5 is based on the Forecast Documents (other than the Base Case Financial Model), Bank Feasibility Study and the Resources and Reserve Statement;
 
 
 
Project facility agreement
page 11

1    Definitions and interpretation 
 
   
 
6 is prepared using the Price Determination Mechanism;
 
7 provides for settlement of all payments under the Buck Creek Asset Purchase Agreements; and
 
8 is divided into monthly periods for the first year and quarterly periods for each subsequent year of the Project,
 
as updated and amended from time to time as required under clause 10.5 and in accordance with clause 10.4.
 
 
 
Basel III Requirement
 
 
any capital requirements, leverage ratio, liquidity standards or other standards, rules or requirements under any of the following published by the Basel Committee on Banking Supervision (as amended, supplemented or restated):
 
1 ‘Basel III: A global regulatory framework for more resilient banks and banking systems’, ‘Basel III: International framework for liquidity risk measurement, standards and monitoring’ and ‘Guidance for national authorities operating the countercyclical capital buffer’, published in December 2010;
 
2 ‘Globally systematically important banks: assessment methodology and the additional loss absorbency requirement - Rules text’, published in November 2011; and
 
any further guidance standards relating to the above or known as Basel III.
 
 
 
Base Rate
 
 
[***]
 
Project facility agreement
page 12

1    Definitions and interpretation 

 
 
Bill
 
a bill of exchange as defined in the Bills of Exchange Act 1909 (Cth).
 
 
 
Bi-monthly Date
 
 
each of 28 February, 30 April, 30 June, 31 August, 31 October and 31 December.
 
 
 
Break Costs
 
 
for any repayment or prepayment the amount (if any) by which:
 
1 the interest on the amount repaid or prepaid which a Lender should have received under this agreement (had the repayment or prepayment not occurred),
 
exceeds:
 
2 the return which that Lender would be able to obtain by placing the amount repaid or prepaid to it on deposit with a Reference Bank,
 
in each case for the period from the date of repayment or prepayment until the last day of the then current Funding Period applicable to the repaid or prepaid amount.
 
 
 
Buck Creek Asset Purchase Agreements
 
1 the Asset Purchase Agreement in relation to the acquisition of the Project dated 28 March 2013, as amended pursuant to: (a) that certain Amendment to Asset Purchase Agreement dated 15 May 2015; and (b) that certain Second Amendment to Asset Purchase Agreement dated 10 April 2017, in each case by and among Buck Creek Resources, LLC, L. Stanley Pigman, Allan Adams, the Borrower, Hartshorne Mining, Hartshorne Land and Hartshorne Coal Mining Limited;
 
2 the Leasehold Mortgage, Security Agreement and Fixture Filing (Hopkins County) dated 28 March 2013, as amended pursuant to: (a) that certain Amendment to Leasehold Mortgage, Security Agreement and Fixture Filing (Hopkins County) dated 15 May 2015; and (b) that certain Second Amendment to Leasehold Mortgage, Security Agreement and Fixture Filing (Hopkins County) dated 10 April 2017, in each case by and between the Borrower, Hartshorne Mining, Hartshorne Land and Buck Creek Resources, LLC;
 
3 the Leasehold Mortgage, Security Agreement and Fixture Filing (McLean County) dated 28 March 2013, as amended and restated pursuant to: (a) that certain Amended and Restated Leasehold Mortgage, Security Agreement and Fixture Filing (McLean County) with an effective date of 15 May 2015; and (b) that certain Amendment to Amended and Restated Leasehold Mortgage, Security Agreement and Fixture Filing (McLean County) dated 10 April 2017, in each case by and between the Borrower, Hartshorne Mining, Hartshorne Land and Buck Creek Resources, LLC;
 
4 the Overriding Royalty Agreement dated 28 March 2013, as amended pursuant to: (a) that certain Amendment to Overriding Royalty Agreement dated 15 May 2015; and (b) that certain Second Amendment to Overriding Royalty Agreement dated 10
 
 
 
Project facility agreement
page 13

1    Definitions and interpretation 
 
   
 
April 2017, in each case by and between Hartshorne Land and Buck Creek Resources, LLC;
 
5 the Reversionary Agreement dated 28 March 2013, as amended pursuant to: (a) that certain Amendment to Reversionary Agreement dated 15 May 2015; and (b) that certain Second Amendment to Reversionary Agreement dated 10 April 2017, in each case by and between Hartshorne Land and Buck Creek Resources, LLC;
 
6 the Promissory Note dated 28 March 2013, in the face principal amount of $[***] as amended from time to time), which was amended and restated by that certain Amended and Restated Promissory Note dated 15 May 2015, in the face principal amount of $[***], which was further amended and restated by that certain Second Amended and Restated Promissory Note dated 10 April 2017, in the face principal amount of $[***], in each case issued by the Borrower, Hartshorne Mining and Hartshorne Land to Buck Creek Resources, LLC;
 
7 the other “Related Agreements” (as defined in the document referred to in paragraph 1 of this definition); and
 
8 all other agreements relating to the acquisition of the Project and the Cypress Coal Mine to be determined during due diligence.
 
 
 
Business Day
 
 
1 for the purposes of clause 21.3, a day on which banks are open for business in the city where the notice or other communication is received excluding a Saturday, Sunday or public holiday;
 
2 for the purposes of the definition of Rate Set Date, a day on which banks are open for business in New York and London excluding a Saturday, Sunday or public holiday; and
 
3 for all other purposes, a day on which banks are open for business in Sydney, Kentucky, New York and London excluding a Saturday, Sunday or public holiday.
 
 
 
Calculation Date
 
 
each Quarter Date.
 
 
 
CFADS
 
 
in respect of any period, an amount equal to:
 
1 the aggregate amount of Revenues for that period; less
 
2 the aggregate amount of:
 
(a)  Project Costs; and
 
        (b)  head office and discretionary expenditure in relation to the Project as detailed in the Life of Mine Plan and the Base Case Financial Model,
 
for that period.
 
Project facility agreement
page 14

1    Definitions and interpretation 

 
 
Change in Law
 
any present or future law, regulation, treaty, order or official directive or request (which, if not having the force of law, would be complied with by a responsible financial institution) which:
 
1 is introduced, or changes, after the date of this agreement; and
 
2 does not relate to a change in the effective rate at which Tax is imposed on the overall net income of a Finance Party or to a FATCA Deduction required to be made by a party,
 
including any such law, regulation, treaty, order or official request relating to capital adequacy, prudential limits, liquidity, reserve asset, Tax or to any Basel III Requirement.
 
 
 
Change of Control
 
 
1 the acquisition, without the prior written consent of the Agent, by any person or a combination of persons acting jointly or in concert of more than 50% of the shares having ordinary voting power for the election of the directors of the Parent; or
 
2 more than a majority of the members of the board of directors of the Parent are changed within any consecutive 12 month period.
 
 
 
CHPP
 
 
the coal handling and processing facility to be constructed at the Project.
 
 
 
Code
 
 
the US Internal Revenue Code of 1986.
 
 
 
Collateral Security
 
 
any present or future Encumbrance, Guarantee or other document or agreement created or entered into by an Obligor as security for, or to credit enhance, the payment of any of the Secured Moneys.
 
 
 
Commitment
 
 
in respect of a Lender at any time, the aggregate of:
 
1 its Tranche One Commitment; and
 
2 its Tranche Two Commitment.
 
 
 
Completion
 
 
occurs when:
 
1 the Agent has received a certificate in form and substance satisfactory to it (acting reasonably) from the Lenders’ Technical Expert confirming that the technical components of the Completion Tests have been passed; and
 
2 the Agent confirms to the Borrower in writing that the Completion Tests have been passed (and the Agent agrees to issue such confirmation promptly after it determines (acting reasonably) that the financial components of the Completion Tests have been passed).
 
Project facility agreement
page 15

1    Definitions and interpretation 

 
 
Completion Date
 
the date on which Completion occurs.
 
 
 
Completion Tests
 
 
the completion tests set out in Schedule 13.
 
 
 
Compliance Certificate
 
 
a certificate in the form of Schedule 7.
 
 
 
Consent Document
 
 
a consent letter, deed of covenant, tripartite deed or other document entered into by the Security Trustee, an Obligor and any other person in relation to the grant of Security.
 
 
 
Contractor
 
 
Fricke Management and Contracting, Inc.
 
 
 
Construction Contract
 
 
the construction agreement in respect of the CHPP dated 23 June 2017 between the Hartshorne Mining and the Contractor.
 
 
 
Construction Costs
 
 
costs incurred by a Project Obligor in connection with the development and construction of the Project in amounts set out in the Annual Construction and Operating Budget and the Base Case Financial Model and including amounts:
 
1 paid or payable by Hartshorne Mining under the Construction Contract;
 
2 paid or payable by Hartshorne Mining under the Slope Contract; and
 
3 paid or payable by the Borrower under the Equipment Finance Facility.
 
To the extent any calculation of Construction Costs is made in conjunction with any calculation of Project Costs, amounts paid or payable by the Borrower under the Equipment Finance Facility shall not be included in the calculation of Construction Costs.
 
 
 
Construction Schedule
 
 
the schedule for the construction of the CHPP in Schedule B of the Construction Contract.
 
 
 
Contamination
 
 
in respect of a property, the presence of Pollutants:
 
1 in, on or under the property; or
 
2 in the ambient air and emanating from the property.
 
 
 
Contested Tax
 
 
a Tax payable by an Obligor where the Obligor is contesting its liability to pay that Tax in good faith and with reasonable grounds
 
 
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and for which it has set aside sufficient reserves.
 
 
 
Controller
 
 
a controller as defined in section 9 of the Corporations Act or a person or entity having the same or similar capacity, authority or rights under US law.
 
 
 
Corporations Act
 
 
the Corporations Act 2001 (Cth).
 
 
 
Cost to Complete
 
 
on any date, the aggregate of (without double counting):
 
1 Project Costs, Construction Costs and Financing Costs, and other fees, legal costs, contingencies and working capital requirements at that time payable but unpaid, in respect of services performed or assets purchased but in respect of which an invoice has not yet been received, in respect of services performed or assets purchased but in respect of which the invoice is not yet payable, or reasonably likely to be incurred by the Obligors from that date until and including the later of the Completion Date and the date on which the Project demonstrates positive CFADS each month consecutively for a 3 month period; and
 
2 the Minimum Proceeds Account Balance.
 
 
 
Cost to Complete Schedule
 
 
the schedule prepared by the Borrower:
 
1 to the extent it is being delivered in connection with a Funding Notice:
 
· outlining the exact purpose for and amount of the proposed Funding Portion;
 
· attaching all relevant invoices to be paid in respect of that Funding Portion;
 
2 outlining the amount of Construction Costs previously advised by the Lenders’ Technical Expert;
 
3 outlining the Cost to Complete at that date;
 
4 outlining the remaining amounts of Available Funding;
 
5 outlining the status of the development and construction of the Project relative to the Project Execution Plan;
 
6 outlining the Project Costs (other than Construction Costs) incurred to date; and
 
7 including an assessment of the likely timing for achieving: (a) the Completion Tests, and detailing any expected delay to the Date for Completion; and (b) the LGE/KU Project Milestones and the potential impact of any expected delay in achieving the LGE/KU Project Milestones.
 
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1    Definitions and interpretation 

 
 
Cypress Coal Mine
 
the coal mine located in the Cypress Project Area and on the Cypress Project Tenements.
 
 
 
Cypress Owned Property
 
 
the real property interests in the Cypress Project Area owned by any Project Obligor listed in part B of part 2 of Schedule 10.
 
 
 
Cypress Project Area
 
 
the area in the McLean and Hopkins Counties, Kentucky, United States of America, that is delineated as the “Cypress Mine Project Area” on the map set out in part A of Schedule 14.
 
 
 
Cypress Project Tenements
 
 
1 the coal lease and sublease agreements and any other leases and licenses in respect of the Cypress Project Area including those listed in part A of part 2 of Schedule 10;
 
2 all entitlements of any Obligor to conduct exploration, prospecting, transporting, mining or processing activities with respect to the Cypress Project Area including under the Dock Agreement and all coal lease and sublease agreements and any other leases and licenses in respect of the Cypress Project Area;
 
3 any present or future interest from time to time held by or on behalf of any Obligor in any present or future right, lease, licence, claim, easement, permit or other authority which confers or may confer a right to prospect, transport or explore for or mine any metals or minerals in respect of the Cypress Project Area;
 
4 any present or future renewal, extension, modification, substitution, amalgamation or variation of any of the mineral and/or surface rights described above (whether extending over the same or a greater or lesser area); and
 
5 any present or future application for or an interest in any of the above which confers or which, when operated, will confer the same or similar rights in relation to the Cypress Project Area.
 
 
 
Date for Completion
 
 
[***].
 
 
 
Debt Service Cover Ratio
 
 
in relation to any Calculation Date on or after 30 September 2019, the ratio of:
 
1 CFADS for the Quarter ending on that Calculation Date; to
 
2 Senior Debt Service for the Quarter ending on that Calculation Date.
 
 
 
Default
 
 
1 an Event of Default; or
 
2 a Potential Event of Default.
 
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1    Definitions and interpretation 

 
 
Dispose
sell, assign, transfer, or otherwise dispose of or cease to hold, or part with possession of, or create a right to or an interest in an asset.
 
 
Distribution
 
 
a withdrawal from the Proceeds Account in accordance with clause 11.2(c)(7)(B) which is permitted under clause 11.3 and Distributed is to be construed accordingly.
 
 
 
Dock Agreement
 
 
the agreement dated 8 May 2015 between E.T. Woosley Farms, LLC and Hartshorne Land.
 
 
 
Dock Area
 
means the aggregate of the areas to which Hartshorne Land has rights under the terms of the Dock Agreement or otherwise in connection with the Dock including:
 
1 the easement for the conveyor belt from a coal mining complex to the dock facility;
 
2 the lease of the surface estate for the dock facility property; and
 
3 the lease of the property along the river bank for the riparian and fleeting rights,
 
located at milepost 61 on the Green River in McLean County, Kentucky, United States of America, which areas are delineated on the map in part B of Schedule 14.
 
 
 
Dollars, US$, USD and $
 
 
the lawful currency of the US.
 
 
 
Due Diligence Report
 
 
the following reports addressed to and able to be relied on by the Finance Parties in respect of the Project and, in each case, prepared in accordance with a scope of work agreed between the Borrower and the Agent:
 
1 the “Independent Technical Review of the Poplar Grove Mine” dated February 2017 and prepared by William G Meister;
 
2 the legal due diligence report dated 5 May 2018 and prepared by Wyatt, Tarrant & Combs, LLP; and
 
3 the “Market Study for Paringa’s .Poplar Grove Mine” dated February 2018 and prepared by Energy Ventures Analysis.
 
 
 
EBITDA
 
 
for any period, an amount equal to net income of the Obligors for such period minus, to the extent included in such net income (but without duplication):
 
1 interest revenues; and
 
2 any extraordinary, non-recurring or unusual income and gains (including, whether or not otherwise includable as a separate
 
 
 
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1    Definitions and interpretation 
 
   
 
item in the calculation of net income, gains on sales outside of the ordinary course of business or on sale lease back transactions), of the Obligors plus, to the extent deducted from such net income (but without duplication):
 
3 Financing Costs;
 
4 income tax expense of the Obligors;
 
5 depreciation expense of the Obligors;
 
6 any extraordinary, non-recurring or unusual charges, expenses or losses incurred by the Obligors (or non-recurring charges, expenses or losses including, whether or not otherwise includable as a separate item in the calculation of net income, losses on sales outside of the ordinary course of business or on sale lease back transactions); and
 
7 compensation to employees, officers and directors of any Obligor paid in equity securities of an Obligor.
 
 
 
Encumbrance
 
 
an interest or power:
 
1 reserved in or over an interest in any asset or property interest, including any retention of title; or
 
2 created or otherwise arising in or over any interest in any asset or property interest under a security agreement, bill of sale, mortgage, charge, lien, pledge, trust or power or any other agreement having similar effect,
 
by way of, or having similar commercial effect to, security for the payment of a debt, any other monetary obligation or the performance of any other obligation, and includes any agreement to grant or create any of the above and includes a security interest within the meaning of section 12(1) of the PPSA and a security interest within the meaning of Section 1-201(35) of the New York Uniform Commercial Code.
 
 
 
Environmental Law
 
 
any legislation regulating Pollutants in connection with the protection of the environment or health and safety.
 
 
 
Environmental Liability
 
 
any actual or potential Loss incurred or which may be incurred in connection with:
 
1 the investigation or remediation;
 
2 a claim by any third party including a subsidence claim;
 
3 any action, order, declaration, notice, notice of violation, suit or abatement order by a Government Agency under an Environmental Law or Mining Law;
 
4 the Reclamation or alleged need for Reclamation of any future, current, former or abandoned areas affected by surface mining activities or other surface disturbance for which any Obligor is
 
 
 
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responsible under any Environmental Law or Mining Law; or
 
5 any agreement between an Obligor and any:
 
· owner or occupier of land; or
 
· Government Agency;
 
of or in respect of Reclamation, any Environmental Law or Mining Law, or Contamination of any Premises
 
 
 
Equipment Finance Facility
 
 
an equipment finance facility or facilities entered into by the Borrower up to a maximum aggregate amount of $[***] which is only secured against the relevant equipment.
 
 
 
Equity
 
 
equity or Subordinated Debt provided, directly or indirectly through another Obligor, to the Borrower by the Parent.
 
 
 
Event of Default
 
 
any event specified in clause 12.1.
 
 
 
Excluded Tax
 
 
a Tax:
 
1 imposed on, or calculated having regard to, the net income of a Finance Party; or
 
2 imposed as a result of a Finance Party being a resident of, or organised or doing business in, the jurisdiction imposing the tax ,
 
3 imposed by way of deduction or withholding where such deduction or withholding arises as a result of a Finance Party who could lawfully avoid (but within 10 Business Days of receipt of a written request from an Obligor or the Agent to do so, has not so avoided) such deduction or withholding by complying with any statutory requirements in force at the present time or in the future to quote its name, address, Australian tax file number, Australian Business Number, tax identification number or similar details to an Obligor or the Agent,
 
but not a Tax:
 
4 calculated on or by reference to the gross amount of any payment (without allowance for any deduction) derived by a Finance Party under a Finance Document or any other document referred to in a Finance Document; or
 
5 imposed as a result of a Finance Party being considered a resident of or organised or doing business in that jurisdiction solely as a result of it being a party to a Finance Document or any transaction contemplated by a Finance Document.
 
 
 
Exercise Notice
 
 
1 in relation to the Options (First Issuance), has the meaning given to “Notice of Exercise” in the terms and conditions of the Options (First Issuance); and
 
 
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1    Definitions and interpretation 
 
   
 
2 in relation to the Options (Second Issuance),has the meaning given to it in clause 9.2(a)(1).
 
 
 
Exercise Price
 
 
1 in relation to the Options (First Issuance), AU$0.66; and
 
2 in relation to the Options (Second Issuance), has the meaning given to it in clause 9.1(e).
 
 
 
Exposure
 
 
at any time in respect of a Lender (but without double counting) the Commitment of that Lender.
 
 
 
FATCA
 
 
1 sections 1471 to 1474 of the Code;
 
2 any treaty, law, regulation or official guidance enacted in any jurisdiction other than the US, or relating to an intergovernmental agreement between the government of the US and any other jurisdiction, which (in either case) facilitates the implementation of Sections 1471 to 1474 of the Code; or
 
3 any agreement pursuant to the implementation of paragraphs 1 or 2 of this definition with the Internal Revenue Service of the US, the government of the US or any Authority in any other jurisdiction.
 
 
 
FATCA Application Date
 
 
1 in relation to a ‘withholdable payment’ described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014;
 
2 in relation to a ‘withholdable payment’ described in section 1473(1)(A)(ii) of the Code (which relates to ‘gross proceeds’ from the disposition of property of a type that can produce interest from sources within the US), 1 January 2019; or
 
3 in relation to a ‘passthru payment’ described in section 1471(d)(7) of the Code not falling within paragraphs 1 or 2 above, 1 January 2019,
 
or, in each case, such other date from which that payment may become subject to a deduction or withholding required by FATCA as a result of any change in FATCA after the date of this agreement.
 
 
 
FATCA Deduction
 
 
a deduction or withholding required by FATCA from a payment under a Finance Document.
 
 
 
FATCA Exempt Party
 
 
a party that is entitled to receive payments free from any FATCA Deduction.
 
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Fee Letter
 
any letter or letters on or after the date of this agreement between a Lender, the Agent or the Security Trustee and the Borrower setting out the fees payable by the Borrower to a Lender, the Agent or the Security Trustee (as the case may be) in respect of the Finance Documents.
 
 
 
Finance Document
 
 
1 this agreement;
 
2 each Fee Letter;
 
3 each Security;
 
4 the Security Trust Deed;
 
5 each Substitution Certificate;
 
6 each Holding Statement;
 
7 each Tripartite Agreement;
 
8 each Irrevocable Payment Direction;
 
9 each LTE Appointment Deed;
 
10  each Subordination Deed; and
 
11   any other document which at any time the Agent and the Borrower agree is a Finance Document for the purposes of this agreement,
 
or any document or agreement entered into or given under any of the above.
 
 
 
Finance Party
 
 
1 the Agent;
 
2 the Security Trustee; and
 
3 each Lender.
 
 
 
Financial Close
 
 
the date that all the conditions precedent set out in clause 2.1 are satisfied or waived by the Agent in writing.
 
 
 
Financial Indebtedness
 
 
any debt or other monetary liability in respect of moneys borrowed or raised or any financial accommodation including under or in respect of any:
 
1 cash advance or debit balance at any financial institution;
 
2 Bill, bond, debenture, note or similar instrument;
 
3 acceptance, endorsement or discounting arrangement;
 
4 finance or capital Lease;
 
5 agreement for the deferral of a purchase price or other payment in relation to the acquisition of any asset or service;
 
6 obligation to deliver goods or provide services paid for in
 
 
 
 
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1    Definitions and interpretation 
 
   
advance by any financier;
 
7 any redeemable shares where the holder has the right, or the right in certain conditions, to require redemption;
 
8 receivables sold or discounted (other than any receivables to the extent they are sold on a non-recourse basis); or
 
9 Hedge Obligations;
 
10  any amount raised under any other transaction (including any forward sale or purchase agreement) of a type not referred to in any other paragraph of this definition having the commercial effect of a borrowing;
 
11   Guarantee in respect of any of the items referred to above,
 
and irrespective of whether the debt or liability:
 
· is present or future;
 
· is actual, prospective, contingent or otherwise;
 
· is at any time ascertained or unascertained;
 
· is owed or incurred alone or severally or jointly or both with any other person; or
 
· comprises any combination of the above.
 
 
Financial Report
 
 
in relation to an entity, the following financial statements and information in relation to the entity, prepared for its financial half year or financial year:
 
1 a statement of financial performance;
 
2 a statement of financial position; and
 
3 a statement of cashflows,
 
together with any notes to those documents and any accompanying reports, statements, declarations and other documents or information.
 
 
 
Financing Costs
 
 
the aggregate of all interest, fees and other finance payments paid or payable by the Obligors in respect of Financial Indebtedness, but not including amounts payable in respect of repayment or prepayment of principal (including, in respect of the Project Loan Facility, Principal Outstanding) or the capital element in respect of any finance leases.
 
 
 
Force Majeure Event
 
 
an event or occurrence which prevents performance in whole or part, provided such event is both:
 
1 beyond the reasonable control of the affected party; and
 
2 not the result of fault or negligence of the affected party,
 
which:
 
3 includes acts of God, war, terrorism, riots, civil insurrection, acts
 
 
 
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of the public enemy, strikes, lockouts, industry-wide labor shortages, labor disputes which cause work stoppages, industry-wide shortages of materials and supplies, fires, flood or earthquakes, and other similar or dissimilar events or occurrences that otherwise satisfy the definition of a Force Majeure Event and a ‘Force Majeure Occurrence’ (as defined in the Construction Contract); and
 
4 does not include changes in market conditions, commercial frustration, commercial impracticability or the occurrence of unforeseen events rendering performance uneconomical.
 
 
 
Forecast Documents
 
 
1 the Life of Mine Plan;
 
2 the Base Case Financial Model;
 
3 the Project Execution Plan;
 
4 the Annual Construction and Operating Budget; and
 
5 the Annual Corporate Budget.
 
 
 
Funding Date
 
 
the date on which a Funding Portion is, or is to be, or is regarded as, advanced, provided or issued, as the case may be, under this agreement.
 
 
 
Funding Notice
 
 
a notice given under clause 4.1.
 
 
 
Funding Period
 
 
a period determined under clause 4.6.
 
 
 
Funding Portion
 
 
each portion of the Commitment provided under this agreement: which has the same Funding Date and the same Funding Period.
 
 
 
Funding Rate
 
 
in respect of a Funding Period, the aggregate of:
 
1 the Base Rate on the Rate Set Date for that Funding Period; and
 
2 the Margin.
 
 
 
Government Agency
 
 
any government or any governmental, semi‑governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or entity.
 
 
 
Gross Debt
 
 
all Financial Indebtedness of the Obligors, including:
 
1 amounts drawn under the Project Loan Facility;
 
2 indebtedness under any Unsecured Subordinated Notes or other Permitted Financial Indebtedness; and
 
 
 
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any other amounts treated as Financial Indebtedness or its equivalent in the Parent’s audited consolidated financial statements,
 
but excluding:
 
3 the marked-to-market exposure under any Hedge Arrangement; and
 
4 any obligations owed to another Obligor.
 
 
 
Gross Debt to EBITDA Ratio
 
 
on any date on or after 30 September 2019, the ratio of:
 
1 Gross Debt on that date; to
 
2 EBITDA for the 6 calendar months prior to that date annualised.
 
 
 
Group
 
 
the group comprising each Obligor.
 
 
 
Group Structure Diagram
 
 
the group structure diagram in Schedule 6, as amended or updated by the delivery of a new diagram to the Agent under clause 8.1(h).
 
 
 
GST
 
 
1 the goods and services tax levied under the GST Act; and
 
2 any sale or use tax imposed by any state or local government in the United States of America.
 
 
GST Act
 
 
 
the A New Tax System (Goods and Services Tax) Act 1999.
 
 
 
Guarantee
 
 
any guarantee, suretyship, letter of credit, letter of comfort or any other obligation:
 
1 to provide funds (whether by the advance or payment of money, the purchase of or subscription for shares or other securities, the purchase of assets or services, or otherwise) for the payment or discharge of;
 
2 to indemnify any person against the consequences of default in the payment of; or
 
3 to be responsible for,
 
any debt or monetary liability of another person or the assumption of any responsibility or obligation in respect of the insolvency or the financial condition of any other person.
 
 
 
Hartshorne Land
 
 
Hartshorne Land, LLC.
 
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Hartshorne Mining
 
Hartshorne Mining, LLC.
 
 
 
Hedge Arrangement
 
 
each interest rate, foreign exchange transaction, equity or equity index option, bond option, commodity swap, commodity option, cap transaction, currency swap transaction, cross-currency swap rate transaction or any other hedge or derivative agreement entered into by an Obligor, including any master agreement and any transaction or confirmation under it.
 
 
 
Hedge Obligations
 
 
 
in respect of Hedge Arrangements, the aggregate (without duplication) at the relevant time, whether or not due at such time, of:
 
1 the net marked-to-market obligations under all Hedge Arrangements; and
 
2 the net amount owing or deliverable under all Hedging Arrangements.
 
 
 
Holding Statement
 
 
 
1 in respect of the Options (First Issuance), the document titled ‘Issuer Sponsored Holding Statement as at 7 April 2017’ prepared by Computershare Investor Services Pty Limited and evidencing the issue of 4,444,444 American style call options in favour of the Original Lender; and
 
2 in respect of the Options (Second Issuance), any other document or statement prepared by Computershare Investor Services Pty Limited (or other entity performing a similar role or service) evidencing the issue of the Options (Second Issuance) in favour of the Original Lender.
 
 
 
Initial Equity Commitment
 
 
[***]
 
 
 
Insolvency Event
 
 
the occurrence of any event specified in clause 12.1(i).
 
 
 
Interest Payment Date
 
 
the last day of each Funding Period unless a Funding Period is greater than 3 months in which case interest will be paid at the end of each Quarter.
 
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Irrevocable Payment Direction
 
an irrevocable direction from the relevant Obligor to any purchaser under a Supply Agreement to pay all amounts under the relevant Supply Agreement to the Proceeds Account.
 
 
 
Lease
 
 
a lease, sublease, charter, hire purchase, hiring agreement or any other agreement or authorisation under which any property is or may be used or operated by a person other than the owner, including any coal or surface lease or sublease.
 
 
 
Lender
 
 
the Original Lender and any person who is a Substitute Lender.
 
 
 
Lenders’ Technical Expert
 
 
any technical engineer appointed by the Agent (following consultation with the Borrower) at the cost of the Borrower under an LTE Appointment Deed.
 
 
 
Lending Office
 
 
in respect of a Lender, the office of that Lender set out opposite its name in Schedule 2 or any other office notified by the Lender under this agreement or in a Substitution Certificate.
 
 
 
LGE/KU
 
 
Louisville Gas and Electric Company and Kentucky Utilities Company.
 
 
 
LGE/KU Project Milestones
 
 
the milestones in the LGE/KU Supply Agreement.
 
 
 
LGE/KU Relevant Date
 
 
the date on which each of the following has occurred under the LGE/KU Supply Agreement:
 
1 the Borrower has achieved the LGE/KU Supply Agreement Project Milestone #12 as set out in Exhibit A – Milestones to the LGE/KU Supply Agreement; and
 
2 the Borrower is producing Product from the Project Area in compliance with section 2.3 of the LGE/KU Supply Agreement.
 
 
LGE/KU Specification Coal
 
 
coal meeting the specifications provided under the LGE/KU Supply Agreement.
 
 
 
LGE/KU Supply Agreement
 
 
the coal supply agreement between the Borrower and LGE/KU dated 15 October 2015, as subsequently amended or varied from time to time including on 16 May 2016.
 
 
 
Life of Mine Plan and
 
 
a life of mine plan which provides a summary of the forecast
 
 
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LOMP
 
construction and operation of the Project which:
 
1 is based on mining the Number 9 Seam;
 
2 is in form and substance satisfactory to the Agent;
 
3 is approved by the board of directors of the Borrower;
 
4 is based on the Resources and Reserves Statement, the Bank Feasibility Study and the Project Execution Plan;
 
5 is supported by appropriately detailed studies and evidence of availability and suitability of resources including power, water, labour and equipment;
 
6 includes the following details and forecasts:
 
 – capital expenditure schedules and drawdown requirements including Construction Costs;
 
 mine plan and schedule for run of mine tonnes and saleable Product;
 
 bypass, washing and key Product specification assumptions;
 
 capital, production and Project Costs;
 
 Reclamation schedule;
 
 cash flow; and
 
 Taxes, royalties, administration costs and expenses; and
 
7 is divided into monthly periods for the first year and Quarterly periods for each subsequent year of the Project,
 
as updated and amended from time to time as required under clause 8.1(f) and in accordance with clauses 10.4 and 10.5.
 
The Lenders may in their discretion elect to accept receipt of the Life of Mine Plan as incorporated in, and part of, the Base Case Financial Model.
 
 
 
Loan Life Cover Ratio
 
 
 
as at a Calculation Date, the ratio of:
 
1 the net present value of the CFADS projected in the Base Case Financial Model for the period from that Calculation Date to the Maturity Date of the Project Loan Facility discounted at the effective Funding Rate on that Calculation Date taking into account the effect of any interest rate hedging; to
 
2 the aggregate of:
 
(a) each outstanding Funding Portion under the Project Loan Facility; and
 
(b) the Total Undrawn PLF Commitments,
 
(without double counting) on the relevant Calculation Date.
 
 
 
Lock Up Hurdle
 
 
on any date, on the Calculation Date preceding that date:
 
1 the Debt Service Cover Ratio is greater than 1.25:1;
 
 
 
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1    Definitions and interpretation 
 
   
 
2 the Loan Life Cover Ratio is greater than 1.50:1; and
 
3 the Project Life Cover Ratio is greater than 2.00:1.
 
 
 
Longstop Date
 
 
[***]
 
 
 
Loss
 
 
any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment.
 
 
 
LTE Appointment Deed
 
 
a deed entered into between the Lenders’ Technical Expert, the Borrower and the Agent.
 
 
 
 
Majority Lenders
 
 
Lenders whose Exposures aggregate more than 51% of the aggregate Exposures.
 
 
 
Margin
 
 
1 prior to the Completion Date, [***]% per annum; and
 
2 on and from the Completion Date, [***]% per annum.
 
 
 
Marketable Securities
 
 
marketable securities as defined in section 9 of the Corporations Act and marketable securities in any limited liability company incorporated in the United States of America.
 
 
 
Material Adverse Effect
 
 
a material adverse effect on:
 
1 the ability of the Obligors (taken as a whole) to perform their obligations under the Finance Documents;
 
2 the validity or enforceability of the Finance Parties’ rights and benefits under the Relevant Documents;
 
3 the validity or perfection or priority of any of the security interests created under the Security; or
 
4 the business, assets, operations or financial condition of the Obligors (taken as a whole).
 
 
 
Material Authorisation
 
 
 
 
at any time, each Authorisation which is necessary to be obtained and maintained by an Obligor for:
 
1 the construction, development, operation or financing of the Project and the Project Assets as planned and required in accordance with the development and operational schedule as set out in the Project Execution Plan, the Life of Mine Plan and the Base Case Financial Model; or
 
2 the conduct by the Obligor of its businesses, operations or the Project (including under Environmental Law and Mining Law),
 
 
 
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at that time and includes each Authorisation referred to in Schedule 11 that is required at that time based on the development and operational schedule for the Project as set out in the Project Execution Plan, the Life of Mine Plan and the Base Case Financial Model.
 
 
 
Material Project Document
 
 
each of the following:
 
[***]
 
 
 
Maturity Date
 
 
 
with respect to the Project Loan Facility:
 
1 if only Tranche One of the Project Loan Facility is drawn, 31 December 2021; and
 
2 if Tranche One and Tranche Two of the Project Loan Facility are drawn, 30 December 2022.
 
 
 
Minimum Proceeds Account Balance
 
 
on any date, the greater of:
 
1 $[***]; and
 
2 at any time, the budgeted Project Costs, Financing Costs and Construction Costs for the 4 weeks following that date as set out in the Annual Construction and Operating Budget and the Base Case Financial Model.
 
 
 
Mining Law
 
 
any and all current or future foreign or domestic, federal, state or local (or any other subdivision) statutes, ordinances, orders, rules, regulations, judgments of a Government Agency, or any other requirements of a Government Agency relating to surface or subsurface mining operations and activities including:
 
1 the Federal Coal Leasing Amendments Act;
 
 
 
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2 the Surface Mining Control and Reclamation Act;
 
3 all other applicable land reclamation and use statutes and regulations;
 
4 the Federal Mine Safety Act of 1977;
 
5 the Black Lung Act;
 
6 the Coal Industry Retiree Health Benefits Act of 1992;
 
7 and any comparable state and local laws or regulations.
 
 
 
Number 9 Seam
 
 
the number 9 coal seam located on the Project Area.
 
 
 
Number 11 Seam
 
 
the number 11 coal seam located on the Project Area.
 
 
 
Obligor
 
 
1 the Borrower; and
 
2 each Guarantor.
 
 
 
Officer
 
 
1 in relation to an Obligor, a director or a secretary, or a person notified to be an authorised officer, of the Obligor; or
 
2 in relation to a Finance Party, any person whose title includes the word ‘Director’ or ‘Managing Director’, and any other person appointed by the Finance Party to act as its authorised officer for the purposes of this agreement.
 
 
 
Operating Accounts
 
 
1 the Dollar account opened by Hartshorne Land with an Account Bank;
 
2 the Dollar account opened by Hartshorne Mining with an Account Bank; and
 
3 the Dollar account opened by the Borrower with an Account Bank,
 
in each case, as renumbered, redesignated or replaced from time to time.
 
 
 
Option Exercise Date
 
 
1 in respect of the Options (First Issuance), the date of exercise of that Option in accordance with the terms and conditions of the Options (First Issuance); and
 
2 in respect of the Options (Second Issuance), the date of exercise of that Option in accordance with the Options (Second Issuance) Terms.
 
 
 
Option Expiry Date
 
 
in respect of Options, the date 4 years from the Option Issue Date
 
 
 
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1    Definitions and interpretation 
 
   
 
for those Options.
 
 
 
Option Issue Date
 
 
1 in relation to the Options (First Issuance) means 7 April 2017; and
 
2 in relation to the Options (Second Issuance), has the meaning given to it in clause 9.1(a).
 
 
 
Option Holder
 
 
in respect of an Option, the holder of that Option.
 
 
 
Options
 
 
1 the Options (First Issuance); and
 
2 the Options (Second Issuance).
 
 
 
Options (First Issuance)
 
 
the 4,444,444 American style call options:
 
1 each expiring on the Option Expiry Date;
 
2 each of which entitle the Option Holder to purchase one Share at the applicable Exercise Price,
 
3 issued by the Parent to the Original Lender in consideration of the Original Lender providing the Facility to the Borrower, and
 
the issue of which has been evidenced in a Holding Statement issued to the Original Lender and dated 7 April 2017.
 
 
 
Options (Second Issuance)
 
 
the 4,444,444 American style call options:
 
1 each expiring on the Option Expiry Date;
 
2 each of which entitle the Option Holder to purchase one Share at the applicable Exercise Price,
 
3 issued by the Parent to the Original Lender in consideration of the Original Lender providing the Facility to the Borrower, and
 
the issue of which will be evidenced in a Holding Statement issued to the Original Lender.
 
 
 
Options (Second Issuance) Terms
 
 
has the meaning given to it in clause 9.3(a).
 
 
 
Overdue Margin
 
 
[***]% per annum.
 
 
 
Overdue Rate
 
 
the aggregate of:
 
1 the Overdue Margin;
 
 
 
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1    Definitions and interpretation 
 
   
 
2 the Margin; and
 
3 the Base Rate on the relevant date on which the Overdue Rate is calculated under clause 17, as determined by the Agent in accordance with the definition of “Base Rate” except that in making the determination all references in that definition to:
 
· ‘Funding Period’ are references to a period of 30 days;
 
· ‘Rate Set Date’ are to the relevant date on which the Overdue Rate is calculated under clause 17; and
 
· ‘Funding Portion’ are to the relevant overdue amount.
 
 
 
Payment Currency
 
 
the currency in which any payment is actually made.
 
 
 
Permitted Disposal
 
 
a Disposal:
 
1 of Product on arm’s length terms in the ordinary course of its ordinary business pursuant to a Supply Agreement or a Permitted Sales Agreement;
 
2 of assets other than Product on arm’s length terms in the ordinary course of business provided that the aggregate book value of, or consideration paid for, all assets Disposed of by each Obligor under this paragraph in any 12 month period does not exceed $1,000,000;
 
3 of assets or property which is expressly permitted by a provision of a Finance Document;
 
4 of assets which have become worn, obsolete or redundant;
 
5 of assets which are to be replaced by newly-acquired assets that perform substantially similar functions;
 
6 of cash solely for the purpose of exchange for the equivalent amount of cash in other currencies;
 
7 where the asset or property is sold, disposed or transferred to another Obligor and, after such sale, disposal or transfer, the Security Trustee continues to hold the benefit of an Encumbrance or Encumbrances over such asset or property that is the same in all material respects as each Encumbrance held prior to such sale, disposal or transfer; provided that prompt written notice of such sale, disposal or transfer shall be provided to the Security Trustee; provided further that such notice shall be given at least 30 days prior to such sale, disposal or transfer if, in connection with such sale, disposal or transfer, the Obligors must execute and deliver (and the relevant Obligors covenant to execute and deliver, prior to or concurrently with such sale, disposal or transfer, all necessary) additional documents or instruments to the Security Trustee in order to maintain an Encumbrance or Encumbrances over the asset or property sold, disposed or transferred that is the same in all material respects as each Encumbrance held prior to such sale, disposal or transfer;
 
8 by way of an adjustment, discount or compromise made in the
 
 
 
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ordinary course of its ordinary business in respect of accounts receivable owed by a third party arising as a consequence or for the purpose of:
 
· resolving any dispute with that third party; or
 
· expediting the payment of any such accounts receivable having an original payment term of greater than 30 days,
 
provided that the aggregate of all such adjustments, discounts or compromises by Obligors does not exceed $250,000 in any 12 month period;
 
9 of mineral and/or surface rights through a lease or sub-lease made in the ordinary course of its ordinary business to a third party, but only if:
 
· the mineable and merchantable coal underlying such property has been exhausted;
 
· such lease or sublease (individually or collectively with other such Disposals) will not materially diminish the quantity, quality or mineability of the mineable and merchantable coal available for the Project; and
 
· the lease or sub-lease will not materially and adversely affect the current or future planned operation of the Project;
 
10   resulting from a casualty or other insured damage to any Secured Property or any part thereof, but only if:
 
· any resulting insurance proceeds are applied in accordance with clause 8.19; and
 
· the loss of the Secured Property (or the affected part thereof) will not materially and adversely affect the current or future planned operation of the Project;
 
11   as a result of the expropriation, compulsory acquisition or condemnation by a Government Agency of a portion of the business or the assets of an Obligor in respect of which the Obligor is compensated, but only if:
 
· the compensation is applied in accordance with clause 3.10; and
 
· the loss of the business or assets of the Obligor (or the affected part thereof) will not materially and adversely affect the current or future planned operation of the Project; or
 
12 approved by the Agent in writing,
 
provided that, unless a contrary intention is expressly set out in one of the preceding paragraphs, each Disposal referenced above will only be a Permitted Disposal if the proceeds of such Disposal are deposited into the Proceeds Account.
 
 
 
Permitted Encumbrance
 
 
1 the Security;
 
2 existing royalty interests with respect to coal on the Project Tenements or the Cypress Project Tenements disclosed to the Agent prior to 4 April 2017 and any future coal royalties granted
 
 
 
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1    Definitions and interpretation 
 
   
 
in connection with the acquisition of any additional Project Tenements or Cypress Project Tenements provided those royalty interests are entered into in the ordinary course of business of the relevant Obligor or Obligors;
 
     
3 an Encumbrance to secure obligations under the Equipment Finance Facility provided that it is limited to an Encumbrance in respect of the equipment being financed;
 
4 servitudes, easements, rights of way, restrictions and other similar Encumbrances on real property imposed by law or incurred in the ordinary course of business and Encumbrances consisting of zoning or building restrictions, easements, licenses, restrictions on the use of property or minor imperfections in title which, in the aggregate, are not material, and which do not in any case materially detract from the value of the property subject to the Encumbrance or interfere with the ordinary conduct of the business of any Obligor or the Project;
 
5 any of the following:
 
(a)  as to assets in Australia, an Encumbrance arising by operation of law in the ordinary course of ordinary business and not securing Financial Indebtedness;
 
(b)  a right of title retention over goods acquired in the ordinary course of ordinary business on the supplier’s usual terms (or on terms more favourable to an Obligor);
 
(c)  an Encumbrance granted under any hire purchase, conditional sale arrangement, consignment or any similar arrangement entered into in the ordinary course of ordinary business in respect of goods supplied to an Obligor on the supplier’s usual terms (or on terms more favourable to an Obligor);
 
(d)  under US law, Encumbrances for Taxes, assessments, charges or levies for which it has set aside sufficient reserves;
 
(e)  as to assets in the US, Encumbrances related to statutory liens arising by operation of law, such as carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s liens, but only while and to the extent such liens are inchoate and are not the subject of any enforcement action;
 
(f)  as to assets in the US, Encumbrances related to statutory liens arising by operation of law, such as carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s liens for which filing has been made or enforcement is being pursued, provided the aggregate amount of all such Encumbrances is less than $500,000;
 
(g)  Encumbrances on cash used (whether directly or as collateral provided to a surety or for a letter of credit or similar instrument, including Encumbrances on cash granted to Argonaut Insurance Company with respect to the Surety Facility) for bonds or other letters of credit and guarantees related to the Project, surface mining and related permits, black lung insurance or self-insurance, supersedeas bonds, workers’ compensation insurance or self-insurance or other
 
 
 
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bonds or guaranties required by a Government Agency in the ordinary course of the Obligors’ ordinary business in connection with their ongoing operations, provided that:
 
  o     the aggregate amount of all cash covered by Encumbrances falling within this paragraph is equal to or less than $2,000,000 at any time; and
 
  o     the Encumbrance is granted or exists in relation to Permitted Financial Indebtedness as described in paragraph 8 of the definition of Permitted Financial Indebtedness;
 
(h)  Encumbrances incurred in the ordinary course of ordinary business arising solely on any cash earnest money deposits made in connection with any letter of intent or purchase agreement in respect of an acquisition of property or assets provided such acquisition is expressly permitted under this agreement; or
 
(i)   purported Encumbrances evidenced by the filing of precautionary UCC financing statements relating solely to operating leases of personal property entered into in the ordinary course of its ordinary business,
 
provided in each case that the secured amount is paid when due or is being contested in good faith on reasonable grounds and any secured amount which remains due after final determination or settlement of the contest is paid promptly;
 
6 any netting or set-off arrangement entered into by an Obligor in the ordinary course of banking arrangements for the purpose of netting or setting off debit and credit balances of its bank accounts in respect of reasonable fees charged by the bank at which the account is held in connection with the maintenance of that bank account or overdraft facilities permitted under paragraph 7 of the definition of Permitted Financial Indebtedness;
 
7 an Encumbrance arising as a consequence of a judgment if the judgment is satisfied promptly or its execution or enforcement is effectively stayed pursuant to a supersedeas or other bond, if required, and the claim to which it relates is being contested in good faith and any amount which remains due after final determination or settlement of the contest is paid promptly;
 
8 the Encumbrances granted in favor of Gregory W. Thomas over Tract 36-38 to secure a portion of the purchase price in an amount not to exceed $424,500 in relation to the acquisition of Tract 36-38;
 
9 the Encumbrances granted in favour of:
 
(a)  Bryan Miles Stratton over Tracts 19-5 and 27-14 as set forth in the Option Agreement for Purchase of Real Estate dated 20 December 2017 between Bryan Miles Stratton and Harshorne Land; and
 
(b)  Mles Farms, LLC over Tract 27-15 as set forth in the Option Agreement for Purchase of Real Estate dated 11 December 2017 between Miles Farms, LLC and Hartshorne Land; and
 
 
 
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10 any other Encumbrance approved by the Agent in writing.
 
Notwithstanding anything in this definition of Permitted Encumbrance to the contrary, the following statutory super-priority liens shall not be considered a Permitted Encumbrance:
 
· perfected statutory landlord’s liens;
 
· statutory liens for unpaid wages; and
 
· liens imposed in connection with reclamation performed by a third party following a bond forfeiture.
 
 
 
Permitted Financial Accommodation
 
 
any financial accommodation or any Guarantee provided by an Obligor in respect of financial accommodation:
 
1 under the Finance Documents;
 
2 provided by an Obligor which is used to effect a payment that is permitted under clause 8.17(b) or clause 8.17(c);
 
3 where such Guarantee is provided in respect of Permitted Financial Indebtedness; or
 
4 with the Agent’s prior written consent.
 
 
 
Permitted Financial Indebtedness
 
 
1 any liability under any agreement (other than the Equipment Finance Facility) entered into in the ordinary course of its ordinary business for the acquisition of any asset or service the acquisition of which is expressly permitted by this agreement where payment for the asset or service is deferred for a period of not more than 90 days and where the aggregate of all such Financial Indebtedness for all Obligors outstanding at any time does not exceed $15,000,000 at any time prior to the Completion Date or $9,000,000 at any time on or after the Completion Date;
 
2 any Financial Indebtedness incurred or permitted to be incurred under any Finance Document;
 
3 any Financial Indebtedness owing under Subordinated Debt;
 
4 Financial Indebtedness incurred in respect of the Equipment Finance Facility;
 
5 any Financial Indebtedness owed by an Obligor to another Obligor;
 
6 any Financial Indebtedness under any Hedge Arrangement entered into in compliance with this agreement;
 
7 any Financial Indebtedness under any unsecured overdraft facilities entered into in the ordinary course of its banking arrangements provided that the aggregate of all such Financial Indebtedness of the Obligors falling within this paragraph is equal to or less than $200,000 at any time, and provided that no overdraft facility will be permitted in respect of any bank account which is held with the Agent;
 
8 any Financial Indebtedness owing under the Surety Facility or in respect of any indemnity or reimbursement obligations in respect
 
 
 
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of any bonding facilities, letters of credit or similar instruments provided that the Financial Indebtedness outstanding at any time under any such facility or arrangement does not, in aggregate, exceed $2,000,000;
 
9 unsecured Financial Indebtedness not falling within paragraphs 1 to 8 above which in aggregate with the Financial Indebtedness of each other Obligor not falling within paragraphs 1 to 8 above is equal to or less than $250,000 at any time; or
 
10   any other Financial Indebtedness approved by the Agent,
 
and includes a Guarantee of any amounts referred to in paragraphs 1 to 9 above, inclusive.
 
 
 
Permitted Sales Agreement
 
 
any agreement entered into by an Obligor for the sale of any Product from the Project:
 
1. which has a term of no longer than 6 months; or
 
2. which has a term of longer than 6 months and is for the sale of no more than 200,000 tonnes of Product.
 
 
 
Phase 1 Environmental Audit
 
 
as per the requirements of the American Society for Testing and Materials: Standard Practice for Environmental Site Assessments: Phase 1 Environmental Site Assessment Process (ASTM Standard Practice E1527-05).
 
 
 
Pollutant
 
 
a pollutant, contaminant, dangerous, toxic or hazardous substance, petroleum or petroleum product, chemical, solid, special liquid, industrial or other waste, which is prohibited, limited or regulated by any Government Agency or which may or could pose a hazard to health and safety or to the indoor or outdoor environment.
 
 
 
Poplar Grove Coal Mine
 
 
the coal mine located in the Project Area and on the Project Tenements in the McLean and Hopkins Counties, Kentucky, United States of America.
 
 
 
Potential Event of Default
 
 
any thing which would become an Event of Default on the giving of notice (whether or not notice is actually given), the expiry of time, the making of any determination, or any combination of the above.
 
 
 
Power
 
 
any right, power, authority, discretion or remedy conferred on a Finance Party, a Receiver or an Attorney by any Finance Document or any applicable law.
 
 
 
PPSA
 
 
the Personal Property Securities Act 2009 (Cth).
 
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PPS Regulations
 
the regulations made under the PPSA.
 
 
 
PPSA Secured Party
 
 
a secured party as defined in the PPSA.
 
 
 
PPSA Security Interest
 
 
a security interest as defined in the PPSA and to which that Act applies.
 
 
 
Premises
 
 
any property owned or occupied by an Obligor or which is used by an Obligor to carry on any activities including the Project.
 
 
 
Price Determination Mechanism
 
 
has the meaning given to it in clause 10.1.
 
 
 
Principal Outstanding
 
 
in relation to the Project Loan Facility at any time, the aggregate principal amount of all outstanding Funding Portions under the Project Loan Facility at that time.
 
 
 
Proceeds Account
 
 
the Dollar account opened or to be opened by the Borrower with the Security Trustee, as renumbered, redesignated or replaced from time to time and as contemplated by clause 11.
 
 
 
Product
 
 
all extracted coal, coal by-products and minerals extracted with coal or as a consequence of the extraction of coal and derived from the Project Area and the Cypress Project Area.
 
 
 
Project
 
 
the development and operation by the Project Obligors of:
 
1 a mine to exploit the Product resources at the Poplar Grove Coal Mine; and
 
2 the Dock Area.
 
 
 
Project Area
 
 
the aggregate area of the areas in the McLean and Hopkins Counties, Kentucky, United States of America, that are delineated as the “Poplar Grove Project Area” and the “Dock Area” on the maps set out in parts A and B of Schedule 14, respectively.
 
 
 
Project Assets
 
 
all the right, title and interest both present and future of the Project Obligors which is attributable to the Project and includes all the right, title and interest both present and future of the Project Obligors in, to, under or derived from:
 
 
 
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1 the Project Tenements;
 
2 the Project Owned Property;
 
3 the Product;
 
4 the Project Area and the Dock Area, including any title to or interest in land in the Project Area now or at a later time held any Project Obligor;
 
5 every contract for the use by any third party of any of the assets and property included in the Project;
 
6 the Material Authorisations and all other Authorisations in relation to the Project;
 
7 the Project Documents relating to the Project;
 
8 the proceeds of any insurance in respect of the Secured Property;
 
9 all exploration and mining information, documents, maps, reports, records, studies and other written data, including all data stored on magnetic tapes, disks or diskettes or any other computer storage media, relating to geological, geochemical and geophysical work, feasibility studies and other operations conducted with respect to the Project Area; and
 
10  all buildings, improvements, conveyor structure and belts, structures, systems, fixtures, trade fixtures, plant, machinery, tools and other personal property at any time used or intended for use in connection with or incidental to the exploration, mining, storage, transporting and processing of Product from the Project Area and all associated facilities and infrastructure.
 
 
 
Project Costs
 
 
for any applicable period, all costs and expenses incurred and paid (or in respect of a future period, projected to be payable) by the Project Obligors in relation to the operation and maintenance of the Project and the holding of, and maintaining compliance with applicable law and agreements with respect to, the Cypress Project Tenements, the Cypress Owned Property and the Cypress Coal Mine in that period, excluding Construction Costs but including:
 
1 operating and routine maintenance expenses;
 
2 royalties in respect of the Project Assets, the Cypress Project Tenements, the Cypress Owned Property or any Product from the Cypress Coal Mine;
 
3 payments under or in respect of any Project Tenement or Cypress Project Tenement;
 
4 essential or non discretionary capital expenditure;
 
5 payments under or in respect of any Project Documents;
 
6 wages, salary and other management and overhead costs;
 
7 taxes;
 
8 rates and charges;
 
9 Reclamation costs;
 
 
 
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10   Financing Costs (other than Senior Debt Service); and
 
11   exploration and other expenditures agreed between the Borrower and the Agent (acting on the instructions of the Majority Lenders).
 
 
 
Project Documents
 
 
1 each document referred to in Schedule 12;
 
2 any contract, agreement, memorandum of understanding or other arrangement relating to the construction, development, operation or financing of the Project and the Project Assets;
 
3 any contract, agreement, memorandum of understanding or other arrangement for or in connection with the Project relating to:
 
· contract mining, earthmoving and crushing;
 
· access and use of land in relation to the Project and infrastructure; or
 
· transportation, barging, handling or ship loading;
 
4 any contract, agreement, memorandum of understanding, lease or licence relating to the Cypress Coal Mine, the Cypress Project Area or the Cypress Project Tenements; and
 
5 any other document that the Agent and the Borrower agree in writing to be a Project Document.
 
 
 
Project End Date
 
 
the date on which the last revenue from the last tonne of reserve will be received as projected in the Base Case Financial Model.
 
 
 
Project Execution Plan
 
 
the final plan for the development, construction and implementation of the Project which is in a form and substance satisfactory to the Agent (in consultation with the Lenders’ Technical Expert) and includes:
 
1 the Construction Schedule, and a detailed monthly schedule for the completion of the development and construction of all relevant infrastructure, the barge load out, the box-cut, the shafts, the decline and the ramp-up of the Project that is consistent with the LGE/KU Project Milestones and demonstrating actual and forecast compliance with the LGE/KU Project Milestones;
 
2 construction design and management plans for the decline, shafts and mains bottom, supported by a geotechnical review by Dr. David Newman or such other geotechnical expert acceptable to the Agent;
 
3 CHPP and surface infrastructure construction design plans (including water management and levee infrastructure);
 
4 ventilation study results and the consequent mine planning for the first 3 years of production;
 
5 the mining plan required under section 4.4 of the LGE/KU Supply
 
 
 
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Agreement which demonstrates that all requirements under the LGE/KU Supply Agreement will be achieved; and
 
6 copies of the Project environmental management plan and workplace health and safety plans,
 
each of which must be consistent with the Life of Mine Plan.
 
 
 
Project Life Cover Ratio
 
 
as at a Calculation Date, the ratio of:
 
1 the net present value of the CFADS projected in the Base Case Financial Model for the period from that Calculation Date to the Project End Date discounted at the effective Funding Rate on that Calculation Date taking into account the effect of any interest rate hedging; to
 
2 the aggregate of:
 
(a) each outstanding Funding Portion under the Project Loan Facility; and
 
(b) the Total Undrawn PLF Commitments,
 
(without double counting) on the relevant Calculation Date.
 
 
 
Project Loan Facility
 
 
the loan facility made available by the Lenders to the Borrower under this agreement in 2 tranches:
 
1 Tranche One; and
 
2 Tranche Two.
 
 
 
Project Obligor
 
 
1 the Borrower;
 
2 Hartshorne Mining;
 
3 Hartshorne Land; and
 
4 any other Obligor that holds or owns any Project Assets.
 
 
 
Project Owned Property
 
 
the real property interests in the Project Area owned by any Project Obligor listed in part B of part 1 of Schedule 10.
 
 
 
Project Tenements
 
1 the coal lease and sublease agreements and any other leases and licenses in respect of the Project Area including those listed in part A of part 1 of Schedule 10;
 
2 any leases, licenses and other rights in respect of, and all entitlements of a Project Obligor to access and use, the surface area of the Project Area whether listed in Schedule 10 or otherwise including, without limitation, the Project Owned Property and the Dock Agreement;
 
3 all entitlements of a Project Obligor to conduct exploration, prospecting, mining, transportation or processing activities with
 
 
 
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respect to the Project Area including in respect of Project Owned Property and under all coal lease and sublease agreements and any other leases and licenses in respect of the Project Area;
 
4 any present or future interest from time to time held by or on behalf of a Project Obligor in any present or future right, lease, licence, claim, easement, permit or other authority which confers or may confer a right to prospect, transport or explore for or mine any metals or minerals in respect of the Project Area;
 
5 any present or future renewal, extension, modification, substitution, amalgamation or variation of any of the mineral and/ or surface rights described above (whether extending over the same or a greater or lesser area); and
 
6 any present or future application for or an interest in any of the above which confers or which, when operated, will confer the same or similar rights in relation to the Project Area.
 
 
 
Project Tenements Dataroom
 
 
the electronic document compilation maintained on “Sharefile” which contains executed copies of each Project Tenement and Cypress Project Tenement, is operated and maintained by the Obligors and in respect of which the Agent and the Lenders and their legal advisers are given free and unfettered access.
 
 
 
Pro Rata Share
 
 
in respect of a Lender, the Commitment of that Lender expressed as a percentage of the Total Commitments.
 
 
 
Quarter
 
 
a period of 3 months ending on a Quarter Date.
 
 
 
Quarter Date
 
 
each 31 March, 30 June, 30 September and 31 December.
 
 
 
Quasi-Security
 
 
any transaction or arrangement whereby an Obligor:
 
1 sells, transfers or otherwise disposes of any of its assets on terms whereby they are or may be leased to or re acquired by an Obligor or any other member of the Group;
 
2 sells, transfers or otherwise disposes of any of its receivables on recourse terms;
 
3 enters into any title retention arrangement in circumstances where the arrangement or transaction is entered into primarily as a method of raising Financial Indebtedness or of financing the acquisition of an asset;
 
4 enters into any arrangement under which money or the benefit of a bank or other account may be applied, set off or made subject to a combination of accounts; or
 
5 enters into any other preferential arrangement having a similar effect.
 
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Rate Set Date
 
in relation to a Funding Period, two Business Days before the first day of that Funding Period.
 
 
 
Ratio
 
 
1 the Debt Service Cover Ratio;
 
2 the Loan Life Cover Ratio;
 
3 the Project Life Cover Ratio;
 
4 the Reserve Tail Ratio; or
 
5 the Gross Debt to EBITDA Ratio.
 
 
 
Receiver
 
 
a receiver or receiver and manager appointed under a Security or a person or entity having the same or similar capacity, authority or rights under US law.
 
 
 
Reclamation
 
 
the reclamation and restoration of land, water and any future, current or former mines, and any other environmental effect of such mines or coal mining operations, as required pursuant to any Mining Law.
 
 
 
Reference Bank
 
 
the principal London offices of four major British banks selected by the Agent in consultation with the Borrower or in any case, such other banks as may be nominated by the Agent in consultation with the Borrower.
 
 
 
Related Body Corporate
 
 
a related body corporate as defined in section 50 of the Corporations Act.
 
 
 
Relevant Currency
 
 
the currency in which a payment is required to be made under the Finance Documents and, if not expressly stated to be another currency, is Dollars.
 
 
 
Relevant Documents
 
 
1 the Project Documents; and
 
2 the Finance Documents.
 
 
 
Relevant Number
 
 
has the meaning given to it in clause 9.2(a)(1).
 
 
 
Remedy Period
 
 
has the meaning given to it in clause 12.5(c)(1).
 
 
 
Repayment Date
 
 
in respect of the Project Loan Facility, each Quarter Date specified in the column headed ‘Quarter Date’ in Schedule 8 in respect of
 
 
 
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1    Definitions and interpretation 
 
   
 
each Repayment Instalment (or as otherwise agreed in writing by the Agent and the Borrower).
 
 
 
Repayment Instalment
 
 
for a Repayment Date:
 
1 if Funding Portions have been provided under each of Tranche One and Tranche Two, the amount specified in the column headed ‘Repayment Instalment’ for the corresponding column headed ‘Quarter Date’ in Part A of Schedule 8; and
 
2 if Funding Portions have been provided under Tranche One only, the amount specified in the column headed ‘Repayment Instalment’ for the corresponding column headed ‘Quarter Ending’ in Part B of Schedule 8.
 
 
 
Repeating Representation
 
 
has the meaning given in to it in clause 7.2(b).
 
 
Reserve Tail Ratio
 
 
the percentage of proved and probable reserves that remain to be mined or treated following the Maturity Date compared to:
 
1 the total proved and probable reserves at the commencement of the Project (as stated in the Life of Mine Plan and the Base Case Financial Model at Financial Close); or
 
2 the total proved and probable reserves in a subsequent revision of the Life of Mine Plan and the Base Case Financial Model (which has been approved by the Agent for use in this calculation).
 
 
 
Resources and Reserve Statement
 
 
a statement prepared by Marshall, Miller & Associates as updated in February 2017 including the Project’s coal resources and reserves, prepared in accordance with the JORC Code 2012 and in a form and substance satisfactory to the Agent.
 
 
 
Restricted Payment
 
 
any:
 
1 dividend, charge, interest, payment or other distribution in respect of, or redemption, repurchase, defeasance or retirement of, the share capital of an Obligor;
 
2 redemption, repurchase, defeasance, retirement or repayment of principal or payment of interest or other amounts on or under any loans to;
 
3 Financial Accommodation provided; or
 
4 any payment,
 
to or for the benefit of an Obligor or any holder of share capital of an Obligor (or any Associate of an Obligor or any such holder).
 
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Retiring Lender
 
a Lender which substitutes a Substitute Lender under clause 19.3 for any of its Commitment.
 
 
 
Revenue
 
 
for any applicable period, all revenues and other amounts in the nature of revenues, received (or in respect of a future period, projected to be received) by the Project Obligors in relation to the Project in that period including:
 
1 all revenues received in respect of the Project including all proceeds under any Supply Agreement and Permitted Sales Agreement, and receipts under any Hedge Arrangement;
 
2 proceeds from business interruption insurance, provided the claim has been accepted by the insurer in writing and the Agent is satisfied (acting reasonably) that the claim will be paid or payable on a fixed date within that applicable period;
 
3 interest on the Accounts and any other interest income;
 
4 net proceeds from the sale or Disposal of assets permitted under the Finance Documents; and
 
5 other income of a revenue nature or a revenue substitution nature (including any (i) amounts payable to an Obligor arising under or in connection with the performance warranty provisions (including performance liquidated damages) of the Project Documents (excluding liquidated damages for delay not actually received by a Project Obligor), and (ii) proceeds of any bank guarantee, performance bond and other security given to an Obligor under any Project Document),
 
but excluding any insurance proceeds (other than from business interruption insurance cover) and proceeds of Financial Indebtedness and Equity, in each case received in that period.
 
 
 
Review Event
 
 
has the meaning given in clause 12.5(a).
 
 
 
Same Day Funds
 
 
a bank cheque or other immediately available (and freely transferable) funds.
 
 
 
Screen Rate
 
 
[***]
 
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Secondary Project Document
 
each Project Document other than a Material Project Document.
 
 
 
Secured Moneys
 
 
all debts and monetary liabilities of each Obligor to the Finance Parties under or in relation to any Finance Document and in any capacity, irrespective of whether the debts or liabilities:
 
1 are present or future;
 
2 are actual, prospective, contingent or otherwise;
 
3 are at any time ascertained or unascertained;
 
4 are owed or incurred by or on account of any Obligor alone, or severally or jointly with any other person;
 
5 are owed to or incurred for the account of any Finance Party alone, or severally or jointly with any other person;
 
6 are owed to any other person as agent (whether disclosed or not) for or on behalf of any Finance Party;
 
7 are owed or incurred as principal, interest, fees, charges, Taxes, damages (whether for breach of contract or tort or incurred on any other ground), losses, costs or expenses, or on any other account;
 
8 are owed to or incurred for the account of any Finance Party directly or as a result of:
 
(a)  the assignment or transfer to any Finance Party of any debt or liability of any Obligor (whether by way of assignment, transfer or otherwise); or
 
(b)  any other dealing with any such debt or liability;
 
9 are owed to or incurred for the account of a Finance Party before the date of this agreement or before the date of any assignment of this agreement to any Finance Party by any other person or otherwise; or
 
10  comprise any combination of the above.
 
 
 
Secured Property
 
 
the property subject to a Security.
 
 
 
Security
 
 
1 a general security agreement granted in favour of the Security Trustee by each Obligor incorporated in Australia;
 
2 a share mortgage granted in favour of the Security Trustee by each Obligor in respect of the shares of each other Obligor registered in Australia;
 
3 any Encumbrance granted by an Obligor in favour of the Security Trustee under this agreement or the benefit of which the Security Trustee acquires from an Obligor after the date of this agreement as security for, among other things, the payment of any of the Secured Moneys including any Security as defined in a Finance Document;
 
 
 
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4 each US Law Security;
 
5 any Collateral Security; or
 
6 any other document which the Security Trustee and the Borrower agree is a Security for the purposes of this agreement.
 
 
 
Security Provider
 
 
a person who has granted a Security.
 
 
 
Security Trust
 
 
the security trust constituted under the Security Trust Deed.
 
 
 
Security Trust Deed
 
 
the security trust deed dated on or about the date of this agreement between the Borrower, the Security Trustee and the initial Security Providers.
 
 
 
Senior Debt Service
 
 
for any applicable period, the aggregate amount of scheduled principal, interest and fees paid or, in respect of a future period, projected to be paid in respect of the Project Loan Facility under the Finance Documents during that period.
 
 
 
Settlement Price
 
 
has the meaning given to it in clause 9.2(a)(2).
 
 
 
Shares
 
 
ordinary shares of the Parent.
 
 
 
Slope Contract
 
 
the unit price contract for the “Poplar Grove Slope” between the Slope Contractor and Hartshorne Mining dated 26 October 2017.
 
 
 
Slope Contractor
 
 
Frontier-Kemper Constructors, Inc.
 
 
 
Subordinated Debt
 
 
any Financial Indebtedness made available to an Obligor which is subordinated to the Project Loan Facility pursuant to a Subordination Deed including the Unsecured Subordinated Notes.
 
 
 
Subordination Deed
 
 
a subordination deed on terms satisfactory to the Agent (acting reasonably).
 
 
 
Subsidiary
 
 
1 in respect of any entity incorporated or established in Australia, a subsidiary as defined in section 46 of the Corporations Act; or
 
2 in respect of any entity incorporated or established in the United States of America, that entity will be a subsidiary of another
 
 
 
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entity (the holding company) if:
 
· the holding company owns, directly or indirectly, more than 50% of the equity or ordinary voting power in that entity; or
 
· the holding company has the power to direct or cause the direction of the management and policies of that entity, whether through ownership of voting, by contract or otherwise.
 
 
 
Substitution Certificate
 
 
a certificate in the form of Attachment 1 which is executed pursuant to clause 19.3.
 
 
 
Substitute Lender
 
 
a person substituted by a Lender under clause 19.3 for any of the Lender’s Commitment.
 
 
 
Supply Agreement
 
 
1 the LGE/KU Supply Agreement; and
 
2 any other agreement entered into by an Obligor for the sale of any Product from the Project (other than a Permitted Sales Agreement) which is in a form and substance and with a counterparty satisfactory to the Agent (acting reasonably).
 
 
 
Surety Facility
 
 
the surety and bonding facility provided by Argonaut Insurance Company to the Borrower and Hartshorne Mining pursuant to the following agreements:
 
1 the General Indemnity Agreement made between the Borrower, Hartshorne Mining and Argonaut Insurance Company dated 17 September 2015;
 
2 the Parent Company Guarantee granted by the Parent in favour of Argonaut Insurance Company dated 17 September 2015;
 
3 the account control agreement between Texas Capital Bank, N.A., Argonaut Insurance Company and Hartshorne Mining dated 11 May 2017; and
 
4 the Collateral Security Agreement between Hartshorne Mining and Argonaut Insurance Company dated 11 May 2017.
 
 
 
Tax
 
 
1 any tax including the GST, levy, charge, impost, duty, fee, deduction, assessment, compulsory loan or withholding; or
 
2 any income, stamp or transaction duty, tax or charge,
 
which is assessed, levied, imposed or collected by any Government Agency and includes any interest, fine, penalty, charge, fee or other amount imposed on or in respect of any of the above.
 
 
 
Tax Act
 
 
the Income Tax Assessment Act 1936 (Cth) or the Income Tax
 
 
 
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Assessment Act 1997 (Cth) as applicable.
 
 
 
Tax Invoice
 
 
includes any document or record treated by the Commissioner of Taxation as a tax invoice or as a document entitling a recipient to an input tax credit.
 
 
 
Title Document
 
 
any original, duplicate or counterpart certificate or document that creates or reflects an ownership or leasehold interest or use right in real property or personal property.
 
 
 
Total Commitments
 
 
at any time, the aggregate of the Commitments of the Lenders at that time.
 
 
 
Total Undrawn PLF Commitments
 
 
at any time, the aggregate of the Undrawn Commitment (Project Loan) of the Lenders at that time.
 
 
 
Total Undrawn Tranche One Commitments
 
 
at any time, the aggregate of the Undrawn Commitments (Tranche One) of the Lenders at that time.
 
 
 
Total Undrawn Tranche Two Commitments
 
 
at any time, the aggregate of the Undrawn Commitments (Tranche Two) of the Lenders at that time.
 
 
 
Tranche One
 
 
the tranche of the Project Loan Facility made available under this agreement in an aggregate amount equal to the Tranche One Commitment.
 
 
 
Tranche One Commitment
 
 
1 in relation to the Original Lender, $15,000,000; and
 
2 in relation to any other Lender, the amount of Tranche One Commitment transferred to it under this agreement,
 
to the extent not cancelled, reduced or transferred by it under this agreement.
 
 
 
Tranche Two
 
 
the tranche of the Project Loan Facility made available under this agreement in an aggregate amount equal to the Tranche Two Commitment.
 
 
 
Tranche Two Commitment
 
 
1 in relation to the Original Lender, $6,700,000; and
 
2 in relation to any other Lender, the amount of Tranche Two
 
 
 
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Commitment transferred to it under this agreement,
 
to the extent not cancelled, reduced or transferred by it under this agreement.
 
 
 
Tripartite Agreement
 
 
1 the tripartite to be entered into on or about the date of this agreement between the Security Trustee, the Borrower and the provider of the Equipment Finance Facility in respect of the Equipment Finance Facility;
 
2 the tripartite agreement entered into or to be entered into on or about the date of this agreement between, amongst others, the Security Trustee, Hartshorne Mining, the Borrower and the Contractor in respect of the Construction Contract; and
 
3 any other document which at any time the Agent and the Borrower agree is a Tripartite Agreement for the purposes of this agreement.
 
 
 
 
Undrawn Commitment (Project Loan)
 
 
in respect of a Lender at any time, the Commitment (Project Loan) of that Lender at that time less the Principal Outstanding provided by that Lender under the Project Loan Facility at that time.
 
 
 
Undrawn Commitment (Tranche One)
 
 
in respect of a Lender at any time, the Tranche One Commitment of that Lender at that time less the Principal Outstanding provided by that Lender under Tranche One at that time.
 
 
 
Undrawn Commitment (Tranche Two)
 
 
in respect of a Lender at any time, the Tranche Two Commitment of that Lender at that time less the Principal Outstanding provided by that Lender under Tranche Two at that time.
 
 
 
Unsecured Subordinated Notes
 
 
unsecured notes issued by the Borrower on terms and conditions acceptable to the Agent (acting reasonably) up to a maximum of $10,000,000 and subordinated on terms acceptable to the Agent.
 
 
 
US
 
 
the United States of America.
 
 
 
US Law Security
 
 
1 a pledge and security agreement granted in favour of the Security Trustee by HCM Resources Pty Ltd (ACN 155 327 521) and each Obligor incorporated in the US evidencing a first priority security interest in the personal property collateral of each Obligor (including over shares or other ownership interests of any other Obligor incorporated in the US);
 
2 an unconditional guaranty by each Obligor incorporated in the US in favour of the Finance Parties;
 
3 a fee and leasehold mortgage, fixture filing and as-extracted collateral filing granted in favour of the Security Trustee by each
 
 
 
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US Obligor owning or maintaining any (a) real property interests or any of the Project Tenements within the Project Area; or (b) real property interests or any of the Cypress Project Tenements within the Cypress Project Area, and such mortgage, fixture filing and as-extracted collateral filing to be registered in County Clerk’s office of Hopkins and McLean Counties, Kentucky evidencing a first priority security interest in the real property collateral, fixtures and the as-extracted collateral of each US Obligor; and
 
4 UCC-1s from each Obligor organised in the State of Delaware and registered with the Delaware Secretary of State.
 
 
 
US Obligor
 
 
1 Hartshorne Holdings, LLC;
 
2 Hartshorne Mining Group, LLC;
 
3 HCM Operations, LLC;
 
4 Hartshorne Mining; and
 
5 Hartshorne Land.
 
 
 
US Tax Obligor
 
 
the Borrower where:
 
1 it is resident for tax purposes in the US; or
 
2 some or all of its payments under the Finance Documents are from sources within the US for US federal income tax purposes or otherwise subject to withholding or backup withholding tax in the United States of America.
 

 
1.3
Interpretation
 
In this agreement headings and bold type are for convenience only and do not affect the interpretation of this agreement and, unless the context requires otherwise:

(a)
words importing the singular include the plural and vice versa;

(b)
words importing a gender include any gender;

(c)
other parts of speech and grammatical forms of a word or phrase defined in this agreement have a corresponding meaning;

(d)
an expression suggesting or referring to a natural person or an entity includes any company, partnership, joint venture, association, corporation or other body corporate and any Government Agency;

(e)
a reference to any thing (including any right) includes a part of that thing but nothing in this clause 1.3(e) implies that performance of part of an obligation constitutes performance of the obligation;

(f)
a reference to a clause, party, attachment, exhibit or schedule is a reference to a clause of, and a party, attachment, exhibit and schedule to, this agreement and a reference to this agreement includes any attachment, exhibit and schedule;

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(g)
a reference to a statute, regulation, proclamation, ordinance or by‑law includes all statutes, regulations, proclamations, ordinances or by‑laws amending, consolidating or replacing it, whether passed by the same or another Government Agency with legal power to do so, and a reference to a statute includes all regulations, proclamations, ordinances and by‑laws issued under that statute;

(h)
a reference to a document includes all amendments or supplements to, or replacements or novations of, that document;

(i)
a reference to liquidation includes official management, appointment of an administrator, compromise, arrangement, merger, amalgamation, reconstruction, winding up, dissolution, deregistration, assignment for the benefit of creditors, scheme, composition or arrangement with creditors, insolvency, bankruptcy, or a similar procedure or, where applicable, changes in the constitution of any partnership or person, or death;

(j)
a reference to a party to any document includes that party’s successors and permitted assigns;

(k)
a reference to an agreement other than this agreement includes an undertaking, deed, agreement or legally enforceable arrangement or understanding whether or not in writing;

(l)
a reference to an asset includes all property of any nature, including a business, and all rights, revenues and benefits;

(m)
a reference to a document includes any agreement in writing, or any certificate, notice, deed, instrument or other document of any kind;

(n)
no provision of this agreement may be construed adversely to a party solely on the ground that the party was responsible for the preparation of this agreement or that provision;

(o)
a reference to drawing, accepting, endorsing or other dealing with a Bill refers to drawing, accepting, endorsing or dealing within the meaning of the Bills of Exchange Act 1909 (Cth);

(p)
a reference to a body, other than a party to this agreement (including an institute, association or authority), whether statutory or not:

(1)
which ceases to exist; or

(2)
whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions;

(q)
a statement by a person that any information or matter is the case ‘to the best of its knowledge and belief’ means that such person has taken all reasonable care to ensure that such information or matter is in fact the case and that such person is not aware of any other information or matter that could affect the accuracy of such information or matter;

(r)
a reference to st is to short tonne;

(s)
references to time are to Sydney time;

(t)
where an act is required to be performed ‘promptly’, it shall be performed within as short a period as reasonably possible from the moment when the act could reasonably be performed, taking into account all of the circumstances;

(u)
an Event of Default is ‘continuing’ or ‘subsisting’ if it has not been:

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(1)
remedied to the satisfaction of the Agent (acting on the instructions of the Majority Lenders) before a Power relating to that Event of Default is exercised; or

(2)
waived in writing by the Agent (acting on the instructions of the Majority Lenders).

1.4
Inclusive expressions

Specifying anything in this agreement after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included unless there is express wording to the contrary.

1.5
Business Day

Except where clause 6.2 applies, where the day on or by which any thing is to be done is not a Business Day, that thing must be done on or by the preceding Business Day.

1.6
PPSA incorporated definitions

The following words and phrases defined in the PPSA have the same meaning in this agreement when used in this agreement with initial capital letters. Where used in this agreement without capital letters, they have their ordinary meaning:

(a)
Accession;

(b)
Chattel Paper;

(c)
Commingled;

(d)
Investment Instrument; and

(e)
Negotiable Instrument.

1.7
Original Lender

While the Original Lender is the only Lender:

(a)
all references to the Agent are taken to be references to Original Lender; and

(b)
the necessity for the Agent to act on the instructions of the Majority Lenders or all Lenders will not apply.

1.8
Accounting Standards

Any accounting practice or concept relevant to this agreement is to be construed or determined in accordance with the Accounting Standards.

1.9
Security Trustee’s limitation of liability protection

(a)
Limitation of liability

(1)
The Security Trustee enters into this agreement only in its capacity as security trustee of the Security Trust and in no other capacity.

(2)
A liability arising under or in connection with this agreement (whether that liability arises under a specific provision of this agreement, for breach of contract or otherwise) can be enforced against the Security Trustee only to the extent to which it can be satisfied out of property of

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the Security Trust out of which the Security Trustee is actually indemnified for the liability.
 
(3)
The limitation of the Security Trustee’s liability under this clause 1.9 applies despite any other provision of this agreement (other than clause 1.9(c)) and extends to all liabilities and obligations of the Security Trustee in relation to any representation, warranty, conduct, omission, agreement or transaction related to this agreement.

(b)
No action against the Security Trustee personally

The parties may not:

(1)
sue the Security Trustee personally;

(2)
seek the appointment of a liquidator, administrator, receiver or similar person to the Security Trustee; or

(3)
prove in any liquidation, administration or arrangement of or affecting the Security Trustee.

(c)
Exception

The provisions of this clause 1.9 will not apply to any obligation or liability of the Security Trustee to the extent that it is not satisfied because there is a reduction in the extent, or an extinguishment, of the Security Trustee’s indemnification out of the assets of the Security Trust, as a result of the Security Trustee’s fraud, gross negligence or breach of trust.

2
Conditions precedent


2.1
Conditions precedent to Financial Close

Financial Close will not occur, and a Lender is not obliged to provide its Commitment or its Pro Rata Share of the first Funding Portion until the Agent has received all of the following in form and of substance satisfactory to the Agent:

(a)
officer’s certificate: an officer’s certificate in the form of Schedule 4 given in respect of each Obligor and dated no more than 5 Business Days before the first Funding Date;

(b)
Finance Documents: originals of each Finance Document listed below, duly executed by all parties to them other than the Finance Parties and, where applicable:

(1)
duly stamped or, if not duly stamped, evidence satisfactory to the Agent that they will be duly stamped; and

(2)
(if relevant) in registrable form together with all executed documents necessary to register them:

(A)
this agreement;

(B)
each Fee Letter;

(C)
each Security;

(D)
the Security Trust Deed;

(E)
each Tripartite Agreement;

(F)
each Irrevocable Payment Direction;

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(G)
each LTE Appointment Deed;

(H)
each Subordination Deed;

(c)
security perfection: evidence that each Security has been perfected in a manner satisfactory to the Agent (other than in respect of:

(1)
any registration that is customarily carried out by a Finance Party; and

(2)
any registrations of Security over any real property interests located in the US, which registrations must be carried out within 10 days after Financial Close and in any event prior to first drawdown under the Project Loan Facility);

(d)
Project Documents: a certified copy of each document referred to in paragraphs 1 to 6 (inclusive) of the definition of Material Project Document in each case duly executed by all parties to it;

(e)
Title Documents: each Title Document required to be lodged with a Finance Party under any Finance Document;

(f)
Obligor agreements: a certified copy of all agreements (and any amendments) entered into between the Obligors;

(g)
Due Diligence Report: a copy of each Due Diligence Report and otherwise satisfactory completion of legal due diligence;

(h)
Lenders’ Technical Expert: evidence of the appointment and the Borrower’s acceptance of the scope of the role of the Lenders’ Technical Expert;

(i)
Bank Feasibility Study: a copy of the Bank Feasibility Study;

(j)
Project Execution Plan: evidence of completion of each of the elements comprising the Project Execution Plan provided at least 60 days before the date of the first Funding Portion under Tranche One;

(k)
Financial Reports: a certified copy of the most recent Financial Report and semi-annual financial statements of the Parent and each of the Obligors;

(l)
Annual Corporate Budget: a certified copy of the initial Annual Corporate Budget initialled by the Borrower and the Agent for identification purposes;

(m)
Annual Construction and Operating Budget: a certified copy of the initial Annual Construction and Operating Budget initialled by the Borrower and the Agent for identification purposes;

(n)
Life of Mine Plan: a certified copy of the initial Life of Mine Plan initialled by the Borrower and the Agent for identification purposes;

(o)
Base Case Financial Model: a certified copy of the independently audited Base Case Financial Model initialled by the Borrower and the Agent for identification purposes, inclusive of a tax opinion in relation to the tax calculations and forecasts set out in the Base Case Financial Model;

(p)
Ratios: the Base Case Financial Model demonstrates that the Obligors are in compliance with clause 8.24;

(q)
Resources and Reserve Statement: a certified copy of the Resources and Reserve Statement;

(r)
enquiries: results of searches, enquiries and requisitions in respect of each Obligor and the Secured Property;
 
(s)
insurance: copies of certificates of currency in relation to insurance satisfying the requirements in clause 8.19 and naming the Security Trustee as loss payee and the Finance Parties as additional insureds;

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(t)
Initial Equity Commitment: evidence, verified and confirmed by the Lenders’ Technical Expert that the Parent has contributed (directly or indirectly) to the Borrower as Equity an amount, in aggregate, at least equal to the Initial Equity Commitment and that an amount at least equal to the Initial Equity Commitment has been spent on Construction Costs (as verified by the Lenders’ Technical Expert);

(u)
Available Funding: a copy of the Cost to Complete Schedule showing that Available Funding is greater than the Cost to Complete so that the Project is fully funded;

(v)
opinions: a legal opinion addressed to the Agent, the Security Trustee and the Original Lender from:

(1)
Herbert Smith Freehills in respect of:

(A)
due execution by each Australian Obligor of each Finance Document (other than each Fee Letter, Holding Statement and Irrevocable Payment Direction) to which it is a party and which is entered into on or before Financial Close; and

(B)
enforceability as against each Obligor of each Finance Document (other than each Fee Letter, US Law Security, Holding Statement, Tripartite Agreement, Irrevocable Payment Direction and LTE Appointment Deed) to which it is a party and which is entered into on or before Financial Close; and

(2)
Frost Brown Todd in respect of:

(A)
due execution by each US Obligor of each Finance Document to which it is a party and which is entered into on or before Financial Close; and

(B)
enforceability as against each Obligor of each US Law Security, Tripartite Agreement and LTE Appointment Deed to which it is a party and which is entered into on or before Financial Close;

(w)
fees: the Agent is satisfied that there are satisfactory arrangements in place in respect of the payment of all fees and expenses due to the Agent, the Security Trustee and the Lenders (including fees of their consultants and advisors) up to Financial Close;

(x)
LGE/KU Supply Agreement: evidence that the Borrower is in compliance with its obligations under the LGE/KU Supply Agreement including compliance and forecast compliance with the LGE/KU Supply Agreement Project Milestones;

(y)
Irrevocable Payment Direction: evidence that the Borrower has delivered an Irrevocable Payment Direction to LGE/KU in respect of the LGE/KU Supply Agreement or to the purchaser under any other Supply Agreement;

(z)
know your client: documentation and other evidence requested by the Agent in relation to each Obligor to satisfy the ‘know your customer’, ‘know your client’, ‘client vetting’ or similar procedures of any Finance Party;

(aa)
no Default or Review Event: no Default or Review Event has occurred which is continuing and no Default or Review Event will result from the Funding Portion being provided;
 
(bb)
warranties correct: each representation and warranty set out in clause 7 is true, correct and not misleading (whether by omission or otherwise) in any material respect;

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(cc)
Environmental Audit: a copy of the Phase 1 Environmental Audit on the Project Area;

(dd)
Options: evidence of issuance of the Options;

(ee)
Ownership interest: evidence of the Project Obligor’s ownership interest in the Project and the Project Area, and in the Cypress Coal Mine and the Cypress Project Area including evidence that:

(1)
all amounts outstanding under the Buck Creek Asset Purchase Agreements have been paid and all related mortgages and encumbrances have been discharged;

(2)
the Project Obligors own all of the Project Owned Property and the Cypress Owned Property; and

(3)
that the Project Obligors have all necessary rights to access the Project Area and the Cypress Project Area;

(ff)
Project Tenements: evidence that:

(1)
the Project Obligors have entered into and hold all applicable Project Tenements applicable to the first 7 years of mineable Product for the Project; and

(2)
the Project Tenements referred to in sub-paragraph (1) above:

(A)
have expiry dates after the year 2035; and

(B)
remain valid and in good standing without any breaches of conditions;

(gg)
Authorisations and Material Authorisations:

(1)
evidence that all Material Authorisations have been obtained and are in full force and effect; and

(2)
confirmation that:

(A)
there has been no default or non-compliance by any Obligor in the performance of any of the terms or conditions of any Material Authorisation which would be likely to result in the cancellation, revocation or suspension of any Material Authorisation, and it is not aware of any fact or circumstance which is reasonably likely to cause any Material Authorisation to be suspended, revoked or cancelled before its normal expiry date;

(B)
no Obligor has received any notice of violation or other fine or penalty with respect to any Material Authorisation from any Government Agency; and

(C)
it is not aware of any Material Authorisation or other Authorisation that will subsequently be required for the construction, development, operation or financing of the Project and the Project Assets as planned and required in accordance with the development and operational schedule as set out in the Project Execution Plan, the Life of Mine Plan and the Base Case Financial Model that:
 
(i)
will not be obtained as and when required in the ordinary course and in a timely manner in accordance with the development and operational schedule as set out in the Project Execution Plan,

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the Life of Mine Plan and the Base Case Financial Model;

(ii)
will be granted on terms more burdensome than customarily applicable to other mining projects in the relevant jurisdiction; and

(iii)
will be granted on terms which necessitate an Obligor expending amounts materially in excess of the amounts set out in the Annual Construction and Operating Budget and the Base Case Financial Model as at Financial Close;

(hh)
Environmental Bonding: evidence that:

(1)
all environmental bonding for the Project required to be in place at the time of Financial Close is in place;

(2)
if required by the issuer of the bonding, the bonding described in paragraph (1) is collateralised;

(3)
the amount of the bonding described in paragraph (1) does not exceed the amount referred to in paragraph 8 of the definition of Permitted Financial Indebtedness; and

(4)
any Encumbrance in respect of collateral provided in respect of the bonding described in paragraph (1) is a Permitted Encumbrance;

(ii)
No Encumbrance: evidence that no Encumbrance has been granted over any of the assets of the Obligors other than the Permitted Encumbrances;

(jj)
No Financial Indebtedness: evidence that the Obligors have not incurred any Financial Indebtedness other than Permitted Indebtedness;

(kk)
Establishment of the Accounts: evidence that the Accounts have been established and that the Minimum Proceeds Account Balance has been deposited into the Proceeds Account (or will be funded from first drawdown);

(ll)
No Material Adverse Effect: evidence that there has been no material adverse change in the business, assets, financial condition or operations of the Obligors since 4 April 2017 or from the information provided to the Lenders prior to the date of this agreement;

(mm)
Project management personnel: evidence that the Obligors have employed senior management and financial, operational, mining and technical staff with appropriate experience and qualifications for the construction, development and operation of the Project;

(nn)
Completion Tests: evidence that the Completion Tests have been agreed;

(oo)
Obligor ownership interest: evidence of the Parent’s ownership interest in the Borrower and each other Obligor;

(pp)
Monitoring Program: a copy of a construction and ramp-up monitoring program agreed by the Agent, the Lenders’ Technical Expert and the Borrower; and

(qq)
Further information: documentation and other information, certificates, Authorisations as the Agent may reasonably request and which has been notified to the Borrower prior to the date of this agreement.

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2.2
Conditions precedent to Tranche One

A Lender is not obliged to provide its Commitment or its Pro Rata Share of any Funding Portion under Tranche One until the Agent has received all of the following in a form and substance satisfactory to the Agent:

(a)
confirmation from the Borrower that no amendments or variations are required to be made to the Life of Mine Plan or the Base Case Financial Model provided to the Agent under clause 2.1, or, to the extent that the Life of Mine Plan or the Base Case Financial Model have been amended in accordance with clauses 10.4 and 10.5, the Lenders’ Technical Expert’s technical review of the revised Life of Mine Plan and Base Case Financial Model has been completed to the Agent’s satisfaction;

(b)
Financial Close has occurred;

(c)
Confirmation that all registrations referred to in clause 2.1(c) have been completed and that the mortgages constitute first ranking perfected Encumbrances subject only to Permitted Encumbrances; and

(d)
where the first Funding Portion under Tranche One will be provided after the date which is 30 days after Financial Close, confirmation that each document and Authorisation produced to the Agent under clause 2.1 remain in full force and effect.

2.3
Conditions precedent to Tranche Two

A Lender is not obliged to provide its Commitment or its Pro Rata Share of any Funding Portion under Tranche Two until the Agent has received all of the following in form and substance satisfactory to the Agent:

(a)
confirmation that each document and Authorisation produced to the Agent under clause 2.1 remains in full force and effect;

(b)
evidence that the Borrower is in compliance with its obligations under the LGE/KU Supply Agreement including compliance and forecast compliance with the LGE/KU Supply Agreement Project Milestones;

(c)
either:

(1)
certified copies of any additional Supply Agreements (or amendments to any existing Supply Agreements) evidencing the agreement to purchase an additional 750,000st of coal on terms and pricing materially consistent with the LGE/KU Supply Agreement; or

(2)
a certified copy of the AEP Supply Contract duly executed by all parties to it;

(d)
confirmation from the Borrower that no amendments or variations are required to be made to the Base Case Financial Model or the Life of Mine Plan provided to the Agent under clause 2.1 or clause 2.2, or, to the extent that the Base Case Financial Model or the Life of Mine Plan have been amended in accordance with clauses 10.4 and 10.5, the Lenders’ Technical Expert’s technical review of the revised Base Case Financial Model or the Life of Mine Plan has been completed to the Agent’s satisfaction; and

(e)
Tranche One of the Project Loan Facility has been fully drawn.

For the avoidance of doubt, if the condition precedent to Tranche Two in clause 2.3(b) is not satisfied by 31 October 2018, Tranche Two will no longer be available and the undertaking in clause 8.25 will apply.

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2.4
Conditions precedent to all Funding Portions

Without limiting clause 2.1, 2.2 or 2.3, a Lender is not obliged to provide its Pro Rata Share of any Funding Portion until the following conditions are fulfilled to the Agent’s satisfaction:

(a)
Funding Notice: the Borrower has delivered a Funding Notice to the Agent requesting the Funding Portion;

(b)
Cost to Complete Schedule: a Cost to Complete Schedule showing that Available Funding is greater than the Cost to Complete so that the Project is fully funded, has been provided by the Borrower to the Lenders’ Technical Expert, in form and substance satisfactory to the Lenders’ Technical Expert, for presentation to the Agent;

(c)
Funding Date: the Funding Date for the Funding Portion is a Business Day within the Availability Period;

(d)
Commitment: the Commitment of that Lender will not be exceeded by providing the Funding Portion;

(e)
Repeating Representations correct: each Repeating Representation is true, correct and not misleading (whether by omission or otherwise) on and as of the date of the relevant Funding Notice and the proposed Funding Date as if it had been made on and as of those dates in respect of the facts and circumstances existing at those times;

(f)
fees: the Agent is satisfied all fees and expenses due to the Finance Parties (including fees of their consultants and advisors) have been paid in full and are not outstanding; and

(g)
no Default or Review Event: no Default or Review Event has occurred which is continuing and no Default or Review Event will result from the Funding Portion being provided.

2.5
Certified copies

An Officer of the relevant Obligor must certify a copy of a document given to a Finance Party under clauses 2.1 to 2.3(e) to be a true copy of the original document. The certification must be made no more than 5 Business Days before the date on which it is provided.

2.6
Benefit of conditions precedent

A condition in this clause 2 is for the benefit only of the Finance Parties and only the Agent acting on the instructions of all Lenders may waive it.

3
Commitment, purpose and availability of Project Loan Facility

3.1
Provision of Commitment

Each Lender must make its Commitment available to the Borrower on the terms of this agreement.

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3.2
Several obligations and rights of Lenders

(a)
The obligations and rights of the Lenders under each Finance Document are several.

(b)
Failure of a Lender to perform its obligations under a Finance Document does not relieve any other Lender from any of its obligations under a Finance Document.

(c)
No Lender is responsible for the obligations of any other Lender under a Finance Document.

(d)
Each Lender may separately enforce its rights under any Finance Document, unless a Finance Document provides otherwise.

3.3
Purpose

The Borrower must use the net proceeds of a Funding Portion under the Project Loan Facility only for:

(a)
payment of Constructions Costs, Financing Costs and Project Costs as set out in the Base Case Financial Model including, subject to clauses 5.4(d) and (e) an amount of up to $1,000,000 for capitalised interest; and

(b)
any other purpose that the Agent approves in writing.

3.4
Cancellation of Commitment during Availability Period

(a)
Subject to clause 3.4(b), the Borrower may cancel all (but not part) of the Tranche Two Commitment by giving the Agent at least 5 Business Days’ notice.

(b)
If the Tranche Two Commitment is cancelled in full, the undertaking at clause 8.25 will apply.

(c)
The Borrower may cancel the Tranche Two Commitment or the Total Undrawn PLF Commitments by giving the Agent at least 5 Business Days’ notice.

(d)
The Commitment of a Lender is cancelled to the extent of its Pro Rata Share of the Tranche Two Commitment or the Total Undrawn PLF Commitments that are cancelled.

(e)
A notice given under clause 3.4(a) is irrevocable.

3.5
Cancellation at end of Availability Period

On the last day of the Availability Period for a Facility, the Commitment of each Lender in respect of that Facility is cancelled to the extent of its Undrawn Commitment in respect of that Facility.

3.6
Voluntary prepayment

(a)
The Borrower may prepay any of the Principal Outstanding in relation to an outstanding Funding Portion by giving the Agent at least 5 Business Days’ prior notice specifying:

(1)
the prepayment date; and

(2)
the relevant Funding Portions which are to be prepaid in whole or in part.

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(b)
Prepayment of part of the Principal Outstanding under clause 3.6(a) may only be made in a minimum amount of $500,000.

(c)
The Borrower must prepay the Principal Outstanding specified in the prepayment notice on the prepayment date specified in the notice together with all unpaid interest or fees accrued to the prepayment date in respect of the prepaid amount and any amount required to be paid under clause 15.2.

(d)
Amounts voluntarily prepaid under the Project Loan Facility will be applied to the Repayment Instalments in inverse order of maturity.

(e)
The Commitment of a Lender under the Project Loan Facility is reduced by its Pro Rata Share of any amount of Principal Outstanding prepaid under this clause 3.6 and accordingly a prepaid amount may not be redrawn.

(f)
A notice given under clause 3.6(a) is irrevocable.

3.7
Prepayment date

The Borrower may make a prepayment under clause 3.6 on any Business Day.

3.8
Mandatory prepayment – exercise of Option

(a)
If the Original Lender notifies the Parent at least 5 Business Days prior to the Option Exercise Date that it requires the Settlement Price for an Option held by it to be applied to prepayment of the Principal Outstanding:

(1)
the Parent irrevocably directs:

(A)
the Original Lender to pay the Settlement Price for that Option to the Agent; and

(B)
the Agent to apply the Settlement Price for that Option to repayment or prepayment of the Principal Outstanding under the Project Loan Facility in respect of the Original Lender;

(2)
the Principal Outstanding in respect of the Original Lender will be reduced by an amount equal to the Settlement Price of that Option and will be applied to Repayment Instalments owing to the Original Lender on a pro rata basis; and

(3)
the obligation of the Original Lender to pay the Settlement Price in respect of that Option will be satisfied and discharged to the extent of any reduction in the Principal Outstanding in accordance with this clause 3.8.

(b)
The Commitment of the Original Lender is reduced by the amount of Principal Outstanding prepaid to it under clause 3.8(a).

(c)
On the date of any prepayment under clause 3.8(a), the Borrower must pay to the Agent (for the account of the Original Lender) all unpaid interest accrued to that prepayment date in respect of the Principal Outstanding prepaid to the Original Lender.

(d)
Notwithstanding clauses 3.8(a) to 3.8(c) above, the Borrower may at its option defer the date of the prepayment referred to in clause 3.8(a) so that it occurs on the last day of the then current Funding Period.

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3.9
Mandatory prepayment – Equity Cure

Immediately following receipt, the Borrower must apply an amount equal to 100% of the contribution received by the Borrower in respect of an Equity Cure under clause 8.24 to prepay the Principal Outstanding under the Project Loan Facility against the remaining Repayment Instalments on a pro rata basis.

3.10
Mandatory prepayment – Compulsory acquisition

Immediately following receipt, the Borrower must apply an amount equal to 100% of the compensation received by it as a result of the expropriation, compulsory acquisition or resumption by a Government Agency of any part of the business or the assets of an Obligor to prepay the Principal Outstanding under the Project Loan Facility against the remaining Repayment Instalments on a pro rata basis.

4
Funding and rate setting procedures


4.1
Delivery of Funding Notice

(a)
If the Borrower requires the provision of a Funding Portion it must deliver to the Agent a Funding Notice.

(b)
The Agent must notify each Lender of the contents of each Funding Notice, and of each Lender’s Pro Rata Share of each Funding Portion requested as soon as reasonably practicable and in any event within 1 Business Day after the Agent receives the Funding Notice.

4.2
Requirements for a Funding Notice

A Funding Notice to be effective must:

(a)
be in writing in the form of, and specify the matters required in, Schedule 5; and

(b)
be received by the Agent before 11.00am on a Business Day at least 4 Business Days before the proposed Funding Date (or any shorter period that the Agent agrees in writing).

4.3
Irrevocability of Funding Notice

The Borrower is irrevocably committed to draw Funding Portions from the Lenders in accordance with each Funding Notice given to the Agent.

4.4
Number of Funding Portions

(a)
The Borrower may only draw 3 times under Tranche One and once under Tranche Two.

(b)
The Borrower must ensure that no more than 4 Funding Portions under the Project Loan Facility are outstanding at any time.

4.5
Amount of Funding Portions

The Borrower may only draw an amount:

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(a)
equal to the Total Undrawn Tranche One Commitments under Tranche One in 3 drawings of $5,000,000 each; and

(b)
up to the Total Undrawn Tranche Two Commitments under Tranche Two.

4.6
Funding Periods

(a)
Unless the Borrower and the Agent otherwise agree:

(1)
the first Funding Period for a Funding Portion under the Project Loan Facility commences on the first Funding Date for that Funding Portion and ends on the next Quarter Date; and

(2)
each subsequent Funding Period for a Funding Portion under the Project Loan Facility commences on the last day of the immediately preceding Funding Period for that Funding Portion and ends on the next Quarter Date.

(b)
If a Funding Period ends on a day which is not a Business Day, it is regarded as ending on the next Business Day in the same calendar month or, if none, the preceding Business Day.

(c)
No Funding Period under the Project Loan Facility may end after the Maturity Date.

4.7
Consolidation and division of Funding Portions under Project Loan Facility

If two Funding Portions under the Project Loan Facility have Funding Periods which are of the same duration and end on the same date, then those Funding Portions will be consolidated into, and treated as, a single Funding Portion on and from the last day of that Funding Period.

4.8
Determination of Funding Rate

(a)
The Agent must notify each Lender and the Borrower of the Funding Rate for a Funding Period under the Project Loan Facility as soon as reasonably practicable, and in any event within 2 Business Days, after it has made its determination of the applicable Base Rate.

(b)
In the absence of manifest error, each determination of the Base Rate by the Agent is conclusive evidence of that rate against the Borrower.

4.9
Market disruption – Project Loan Facility

(a)
If the Agent determines that a Market Disruption Event occurs in relation to a Funding Portion under the Project Loan Facility for any Funding Period, then it shall promptly notify the Lenders and the Borrower and the rate of interest on each Affected Lender’s participation in that Funding Portion for the Funding Period shall be the rate per annum which is the sum of:

(1)
the Margin; and

(2)
the rate notified to the Agent by that Affected Lender as soon as practicable and in any event no later than the Business Day before interest is due to be paid in respect of that Funding Period, to be that which expresses as a percentage rate per annum the cost to that Affected Lender of funding its participation in that Funding Portion from whatever source or sources it may reasonably select.

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(b)
Each Lender shall determine the rate notified by it under clause 4.9(a)(2) in good faith. The rate so notified will be conclusive and binding on the parties in the absence of manifest error.

(c)
In this agreement, “Market Disruption Event” means:

(1)
at or about noon on the Rate Set Date for the relevant Funding Period, the Screen Rate for a term equivalent to the relevant Funding Period is not available and fewer than 3 of the Reference Banks supplies a rate to the Agent to determine the Base Rate for the relevant period (in which case each Lender will be an “Affected Lender”); or

(2)
before 5pm on the Business Day after the Rate Set Date for the relevant Funding Period, the Agent receives notification from a Lender or Lenders whose participation in that Funding Portion exceed 30% of that Funding Portion, that as a result of market circumstances not limited to it (whether or not those circumstances, or their effect on the Lender’s cost of funds, subsist on the date of this agreement or the date that it becomes a Lender) the cost to it on the Rate Set Date of funding its participation in that Funding Portion (from the wholesale market for Dollars) would be in excess of the Base Rate (in which case an “Affected Lender” will be each Lender which gives such a notification).

4.10
Alternative basis of interest or funding

(a)
If a Market Disruption Event occurs and the Agent or the Borrower so requires, the Agent and the Borrower shall enter into negotiations (for a period of not more than 30 days) with a view to agreeing a substitute basis for determining the rate of interest.

(b)
Any alternative basis agreed under clause 4.10(a) above shall only apply with the prior consent of each Lender and the Borrower, and then shall be binding on all parties.

(c)
The Agent shall promptly inform the Borrower and each Lender of any alternative basis agreed under this clause 4.10.

4.11
Agent’s role and confidentiality

(a)
The Agent shall promptly notify the Borrower on request:

(1)
any rate, or other information notified or specified by a Lender under clauses 4.9 or 4.10; and
 
(2)
if there is a Market Disruption Event under clause 4.9(c)(2), the identity of any Lender or Lenders giving a notification under that clause.

(b)
Each of the Agent and the Borrower shall keep confidential and not disclose to any other Lender or any other person except the Borrower, any information relating to a Lender described in paragraph (a) above. The Agent shall ensure that its officers and employees involved in performing its functions as Agent keep that information confidential and do not disclose it or allow it to be available to any other person or office within the Agent.

However, the Agent, the Borrower, or its officers or employees may disclose such information:

(1)
to the extent required by any applicable law or regulation; or

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(2)
to the extent it reasonably deems necessary in connection with any actual or contemplated proceedings or a claim with respect to clauses 4.9 or 4.10.

(c)
A Lender who gives a notification under clause 4.9(c)(2) at any time before 5pm on the Business Day after the relevant Rate Set Date may in that notification request the Agent to notify each other Lender that it has received a notification under clause 4.9(c)(2) (without giving details) and the Agent shall promptly comply with the request.

4.12
Prepayment of Affected Lender

(a)
If any Lender gives notice under clause 4.9(c)(2) in respect of a Market Disruption Event (Affected Lender), the Borrower may, at any time before the expiry of the Availability Period for the Project Loan Facility and while the Market Disruption Event continues, give the Agent notice of cancellation of the Commitment of the Affected Lender and of its intention to procure the repayment of the Principal Outstanding owing to the Affected Lender.

(b)
On receipt of a notice referred to in paragraph (a) above, the Commitment of that Lender shall immediately be reduced to zero.

(c)
The Borrower must prepay the relevant Principal Outstanding of that Lender within 5 Business Days of giving notice in accordance with paragraph (a) above.

(d)
Clauses 3.6(c) to (f) and 3.7 will apply to any amount prepaid in accordance with this clause 4.12 as if such amount were a prepayment for the purposes of clause 3.6.

5
Project Loan Facility


5.1
Provision of Funding Portions

If the Borrower gives a Funding Notice in respect of the Project Loan Facility, each Lender must provide to the Agent its Pro Rata Share of each specified Funding Portion under the Project Loan Facility in Same Day Funds in Dollars no later than 12 noon on the specified Funding Date and in accordance with that Funding Notice.

5.2
Payment to Borrower

On receipt of the amounts paid to it by the Lenders under clause 5.1, the Agent must pay those amounts in Same Day Funds in Dollars to the Borrower or as directed by the Borrower in the relevant Funding Notice.

5.3
Repayment

(a)
The Borrower must repay each Funding Portion under the Project Loan Facility in instalments on each Repayment Date by paying the Repayment Instalment for that Repayment Date.

(b)
The Borrower must repay each Funding Portion under the Project Loan Facility and all other Secured Moneys:

(1)
in full on the relevant Maturity Date; and

(2)
otherwise as required under this agreement.

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(c)
The Commitment of a Lender is reduced by its Pro Rata Share of any amount of Principal Outstanding repaid under this clause 5.3 and accordingly a repaid amount may not be redrawn:

5.4
Interest

(a)
The Borrower must pay interest on the principal amount of each Funding Portion under the Project Loan Facility for each Funding Period at the Funding Rate for the Funding Period.

(b)
Interest is calculated on daily balances on the basis of a 360 day year and for the actual number of days elapsed from and including the first day of each Funding Period to, but excluding, the last day of the Funding Period or, if earlier, the date of prepayment or repayment of the Funding Portion under this agreement.

(c)
Subject to clause 5.4(d), the Borrower must pay accrued interest in arrears to the Agent on each Interest Payment Date.

(d)
Subject to clause 5.4(e), interest payable by the Borrower under the Project Loan Facility prior to the first Repayment Date under Schedule 8, will, if not elected to be paid in cash by the Borrower in accordance with clause 5.4(c), be automatically capitalised on the relevant Interest Payment Date and:

(1)
will form part of the Funding Portion in respect of which it accrued and the Undrawn Commitment of each Lender will be reduced by its Pro Rata Share of the amount capitalised; and

(2)
will form part of the Principal Outstanding of the Project Loan Facility.

(e)
The capitalisation of interest under clause 5.4(d) is subject to:

(1)
a limit of $1,000,000 over the life of the Project Loan Facility;

(2)
the Principal Outstanding under the Project Loan Facility after the capitalisation not exceeding the Commitment of all Lenders; and

(3)
no Event of Default subsisting.

6
Payments


6.1
Manner of payment

All payments by an Obligor under the Finance Documents must be made:

(a)
in Same Day Funds;

(b)
in Dollars; and

(c)
no later than 11.00am on the due date,

to the Agent’s account as specified by the Agent to the Borrower (unless a contrary indication appears in a Finance Document) or in any other manner the Agent or the Security Trustee directs from time to time.

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6.2
Payments on a Business Day

If a payment is due on a day which is not a Business Day, the due date for that payment is the next Business Day in the same calendar month or, if none, the preceding Business Day, and interest must be adjusted accordingly.

6.3
Payments in gross

All payments which an Obligor is required to make under any Finance Document must be without:

(a)
any set‑off, counterclaim or condition; or

(b)
any deduction or withholding for any Tax or any other reason unless the Obligor is required to make a deduction or withholding by applicable law including FATCA.

6.4
Additional payments

If:

(a)
any Obligor is required to make a deduction or withholding in respect of Tax (other than Excluded Tax or a FATCA Deduction) from any payment to be made to a Finance Party under any Finance Document; or

(b)
a Finance Party is required to pay any Tax (other than Excluded Tax or a FATCA Deduction) in respect of any payment it receives from an Obligor or the Agent under any Finance Document,

the Obligor:

(c)
indemnifies each Finance Party against that Tax; and

(d)
must pay to each Finance Party an additional amount which is necessary to ensure that each Finance Party receives when due a net amount (after payment of any Tax in respect of each additional amount) that is equal to the full amount it would have received if a deduction or withholding or payment of Tax had not been made.

6.5
Taxation deduction procedures

If clause 6.4(a) applies:

(a)
the Obligor must pay the amount deducted or withheld to the appropriate Government Agency as required by law; and

(b)
the Obligor must:

(1)
use reasonable endeavours to obtain a payment receipt from the Government Agency (and any other documentation ordinarily provided by the Government Agency in connection with the payment); and

(2)
within 2 Business Days after receipt of the documents referred to in clause 6.5(b)(1), deliver copies of them to the Agent.

6.6
Tax Credit

If an Obligor makes an additional payment under clause 6.4 for the benefit of a Finance Party, and the Finance Party determines that:

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(a)
a credit against, relief or remission for, or repayment of any Tax (Tax Credit) is attributable to that additional payment; and