Exhibit 4.9

 

 

   

 

Pursuant to 17 CFR 229.601(b)(2)(ii), confidential information (indicated by [***]) has been omitted from this exhibit because it is both not material and would likely cause competitive harm to the registrant if publicly disclosed.


Agreement

 

  Poplar Grove Coal Mine  
     
  Term facility agreement  
     
 

Hartshorne Mining Group, LLC. (as Borrower)

 

Paringa Resources Limited (as Parent)

 

Each party listed in Schedule 1 (as Guarantors)

 

Each party listed in Schedule 2 (as Original Lenders)

 

Tribeca Global Resources Credit Pty Ltd (as Agent)

 

Global Loan Agency Services Australia Nominees Pty Ltd (as Security Trustee) 

 

 

 

ANZ Tower 161 Castlereagh Street Sydney NSW 2000 Australia
GPO Box 4227 Sydney NSW 2001 Australia 

T +61 2 9225 5000 F +61 2 9322 4000
herbertsmithfreehills.com DX 361 Sydney 

 


 

 

   

 

Contents

 

  Table of contents  
     
     
1 Definitions and interpretation 2
     
1.1 Agreement components 2
1.2 Definitions 2
1.3 Interpretation 44
1.4 Inclusive expressions 46
1.5 Business Day 46
1.6 PPSA incorporated definitions 46
1.7 Accounting Standards 46
1.8 Limitation on liability of Equity Trustees Limited 46
1.9 Security Trust Deed 47
1.10 Capacity of Security Trustee 47
     
2 Conditions precedent 48
     
2.1 Conditions precedent to Financial Close and Tranche One 48
2.2 Conditions precedent to Tranche Two 52
2.3 Alternative lender for Tranche Two 52
2.4 Conditions precedent to all Funding Portions 53
2.5 Certified copies 53
2.6 Benefit of conditions precedent 53
     
3 Commitment, purpose and availability of Term Loan Facility 54
     
3.1 Provision of Commitment 54
3.2 Several obligations and rights of Lenders 54
3.3 Purpose 54
3.4 Cancellation of Commitment during Availability Period 54
3.5 Cancellation at end of Availability Period 54
3.6 Voluntary prepayment 55
3.7 Prepayment date 55
3.8 Mandatory prepayment – Equity Cure 55
3.9 Mandatory prepayment – Compulsory acquisition 55
3.10 Mandatory prepayment – Debt Service Reserve Account 56
     
4 Funding and rate setting procedures 56
     
4.1 Delivery of Funding Notice 56
4.2 Requirements for a Funding Notice 56
4.3 Irrevocability of Funding Notice 57
4.4 Funding Portions 57
4.5 Funding Periods 57
4.6 Consolidation and division of Funding Portions under Term Loan Facility 57
4.7 Determination of Funding Rate 57
4.8 Market disruption – Term Loan Facility 57
4.9 Alternative basis of interest or funding 58
4.10 Agent's role and confidentiality 58
4.11 Prepayment of Affected Lender 59
     
5 Term Loan Facility 59
     
5.1 Provision of Funding Portions 59
5.2 Payment to Borrower 59

Term facility agreement       Contents 1

 

 

   

 

5.3 Repayment 59
5.4 Interest 60
     
6 Payments 60
     
6.1 Manner of payment 60
6.2 Payments on a Business Day 60
6.3 Payments in gross 60
6.4 Additional payments 61
6.5 Taxation deduction procedures 61
6.6 Tax Credit 61
6.7 Tax affairs 61
6.8 FATCA Deduction 62
6.9 FATCA Information 62
6.10 Amounts payable on demand 63
6.11 Appropriation of payments 63
6.12 Distribution by Agent 63
6.13 Non-receipt of funds by Agent 64
6.14 Redistribution of payments 64
6.15 Rounding 64
6.16 Currency exchanges 65
6.17 Anti-money laundering 65
     
7 Representations and warranties 65
     
7.1 Representations and warranties 65
7.2 Survival and repetition of representations and warranties 71
7.3 Reliance by Finance Parties 71
     
8 Undertakings 71
     
8.1 Provision of information and reports 71
8.2 Proper accounts 72
8.3 Notices to the Agent 72
8.4 Compliance 74
8.5 Maintenance of capital 74
8.6 Compliance with laws and Authorisations 74
8.7 Payment of Taxes and outgoings 75
8.8 Project Documents 75
8.9 Amendments to constitution; maintenance of corporate existence 77
8.10 Negative pledge and Disposal of assets 77
8.11 Financial Indebtedness 78
8.12 No change to business 78
8.13 Financial accommodation 78
8.14 Restrictions on dealings 78
8.15 Restrictions on acquisitions, investments and capital expenditures 78
8.16 Subsidiaries 79
8.17 Restricted Payments 79
8.18 Secured Property 79
8.19 Insurance 80
8.20 Key personnel 82
8.21 Conduct of Project 82
8.22 Hedging 83
8.23 Inspection and assistance 83
8.24 Financial undertakings 83
8.25 Consent to security 85
8.26 Term of undertakings 86

 

Term facility agreement       Contents 2


 

   

 

9 Options 86
9.1 Issue of Options 86
9.2 Option exercise 87
9.3 Option terms 87
     
10 Forecast Documents 88
     
10.1 Calculations 88
10.2 Calculations in Dollars 88
10.3 Update of Forecast Documents 88
10.4 Factors since commencement of production 89
10.5 Determination is binding 89
     
11 Accounts and proceeds 89
     
11.1 Account Bank Deed 89
11.2 Establishment and maintenance of Accounts 89
11.3 Operating Accounts 91
11.4 Restricted Accounts 91
11.5 Debt Service Reserve Account 91
11.6 Term Deposit Account 92
     
12 Events of Default 92
     
12.1 Events of Default 92
12.2 Effect of Event of Default 97
12.3 Obligors to continue to perform 97
12.4 Enforcement 97
12.5 Review Event 97
     
13 Increased costs and illegality 99
     
13.1 Increased costs 99
13.2 Illegality 100
13.3 Minimisation 100
     
14 Guarantee and indemnity 101
     
14.1 Guarantee 101
14.2 Payment 101
14.3 Securities for other money 101
14.4 Amount of Secured Moneys 101
14.5 Proof by Agent 101
14.6 Avoidance of payments 102
14.7 Indemnity for avoidance of Secured Moneys 102
14.8 No obligation to marshal 103
14.9 Non-exercise of Guarantors’ rights 103
14.10 Principal and independent obligation 103
14.11 Suspense account 103
14.12 Unconditional nature of obligations 104
14.13 No competition 105
14.14 Continuing guarantee 106
14.15 Variation 106
14.16 Judgments 106
     
15 Indemnities 107
     
15.1 General indemnity 107
15.2 Early Prepayment Fee 107
15.3 Foreign currency indemnity 107
15.4 Conversion of currencies 108
15.5 Continuing indemnities and evidence of loss 108

 

Term facility agreement       Contents 3


 

 

   

 

16 Fees, Tax, costs and expenses 108
     
16.1 Fee Letters 108
16.2 Term Loan Facility Commitment Fee 109
16.3 Option Fee 109
16.4 Tax 109
16.5 Costs and expenses 109
16.6 GST 110
     
17 Interest on overdue amounts 110
     
17.1 Payment of interest 110
17.2 Accrual of interest 110
17.3 Rate of interest 111
     
18 Relations between Agent and Lender 111
     
18.1 Appointment of Agent 111
18.2 Agent’s capacity 111
18.3 Agent’s obligations 111
18.4 Agent’s powers 112
18.5 Instructions to Agent 112
18.6 Assumptions as to authority 112
18.7 Agent’s liability 112
18.8 Delegation 113
18.9 Agent entitled to rely 113
18.10 Provision of information 113
18.11 Indemnity by Lenders 114
18.12 Independent appraisal by Lenders 114
18.13 Resignation and removal of Agent 115
18.14 Institution of actions by Lenders 115
18.15 Identity of Lenders 116
18.16 Electronic transmission of notices 116
18.17 Security Trustee’s capacity 116
18.18 Disclosure of Information by Lenders 116
     
19 Assignment, substitution and accession 116
     
19.1 Assignment by Obligor 116
19.2 Assignment by Lenders 117
19.3 Substitution Certificate 117
19.4 Accession Certificate 118
19.5 Assist 118
19.6 Securitisation Permitted 118
19.7 Participation permitted 119
19.8 Lending Office 119
19.9 No increase in costs 119
19.10 Conduct of loan transfers 119
19.11 No increase in costs (Alternative T2 Lender) 120
     
20 Saving provisions 120
     
20.1 No merger of security 120
20.2 Exclusion of moratorium 120
20.3 Exclusion of PPSA provisions 120
20.4 Conflict 121
20.5 Consents 121
20.6 Principal obligations 121
20.7 Non-avoidance 121
20.8 Set-off authorised 122

 

Term facility agreement       Contents 4



 

   

 

20.9 Agent’s certificates and approvals 122
20.10 No reliance or other obligations and risk assumption 122
20.11 Power of attorney 122
     
21 General 123
     
21.1 Confidential information and publicity 123
21.2 Obligor to bear cost 124
21.3 Notices 124
21.4 Governing law and jurisdiction 124
21.5 Prohibition and enforceability 125
21.6 Waivers 125
21.7 Variation 125
21.8 Cumulative rights 126
21.9 Attorneys 126
21.10 Counterparts 126
21.11 Process agent 126

 

  Schedules  
     
  Schedule 1  
  Guarantors 128
     
  Schedule 2  
  Original Lenders and Commitments 129
     
  Schedule 3  
  Notice details 130
     
  Schedule 4  
  Officer’s certificate for entities incorporated in Australia 132
     
  Schedule 5  
  Officer’s certificate for entities incorporated in the United States of America 134
     
  Schedule 6  
  Funding Notice 138
     
  Schedule 7  
  Group Structure Diagram 140
     
  Schedule 8  
  Compliance Certificate 141

 

Term facility agreement       Contents 5


 

 

   

 

  Schedule 9  
  Option Terms 144
     
  Schedule 10  
  Part 1 - Project Tenements and Project Owned Property 148
  Part 2 – Cypress Project Tenements and Cypress Owned Property 156
     
  Schedule 11  
  Material Authorisations 171
     
  Schedule 12  
  Project Documents 173
     
  Schedule 13  
  Map of Project Area, Cypress Project Area and Dock Area 174
     
  Signing page 176
     
  Attachment 1  
  Substitution certificate  
     
  Attachment 2  
  Accession Certificate  

 

Term facility agreement       Contents 6


 

 

   

 

Term facility agreement

 

 

Date

 

Between the parties  
Borrower

Hartshorne Mining Group, LLC 

 

(Borrower)

 

Parent

Paringa Resources Limited 

 

(Parent)

 

Guarantors Each party listed in Schedule 1 (Guarantors)
Original Lenders Each party listed in Schedule 2 (Original Lenders)
Agent

Tribeca Global Resources Credit Pty Ltd 

 

ABN 18 630 267 337 

 

(Agent)

 

Security Trustee

Global Loan Agency Services Australia Nominees Pty Ltd 

 

ACN 608 945 008 

 

(Security Trustee)

 

Background The Lenders have agreed to provide the Term Loan 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.
   

 

Term facility agreement       page 1



 

   

 

1 Definitions and interpretation

 

1.1 Agreement components

 

This agreement includes any schedule.

 

1.2 Definitions

 

The meanings of the terms used in this agreement are set out below.

 

Term Meaning
Accession Certificate a certificate substantially in the form of Attachment 2 which is executed pursuant to clause 19.3.
Account Bank

1    [***], provided that it has entered into an Account Bank Deed;

 

2    [***], 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 Operating Accounts; and

 

2    the Debt Service Reserve Account.

 

Additional Requirements has the meaning given to it in clause 12.5.
AEP Supply Agreement the coal supply agreement between Indiana Kentucky Electric Corporation and the Borrower dated 1 October 2018.
Agent Fee Letter the fee letter titled ‘Poplar Grove Coal Mine Term Facility Agreement – Agent Fee Letter’ dated on or about the date of this agreement between the Borrower and the Agent.

 

Term facility agreement       page 2


 

 

  21  General

 

  Term Meaning
  Aggregate Costs

the aggregate cash operating costs of the Project Obligors, including:

 

1    mining costs;

 

2    processing costs;

 

3    transportation and other costs;

 

4    royalties and taxes;

 

5    equipment lease costs;

 

6    sustaining capital expenditure;

 

7    corporate overhead costs for the Group;

 

8    labour costs;

 

9    equipment rental and support services;

 

10  supplies and maintenance costs,

 

but excluding:

 

11  initial capital expenditure;

 

12  capital expenditure related to mining equipment; and

 

13  Financing Costs, but including any equipment finance costs to the extent not already included in mining costs, down payments and reimbursements).

 

  All in Unit Costs
in relation to any relevant period, Aggregate Costs incurred during that relevant period divided by the number of tons of Product produced for sale or marketable during that relevant period.
 
  Alternative T2 Lender
has the meaning given to that term in clause 2.3(a)
 
  Annual Budget

the annual budget in form and substance satisfactory to the Agent incorporating a corporate budget for the Parent and its consolidated group entities and the operating budget for the Project which:

 

1    is approved by the board of directors of the Parent and the Borrower;

 

2    is to be provided initially in accordance with clause 2.1(h), as updated and amended from time to time in accordance with clause 10.3;

 

3    reflects the next calendar year and is broken down into monthly periods;

 

4    separates Australian and US expenditures; and

 

5    is based on the Resources and Reserves Statement;

 

6    is consistent with the Life of Mine Plan.

 

The Agent may in its discretion elect to accept receipt of the Annual Budget as incorporated in, and part of, the Life of Mine Plan.

 

 

Term facility agreement       page 3


 

 

  21  General

 

  Term Meaning
  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, lease, sublease, easement, entitlement, right, licence, approval, permit or authority which is described in the definitions of Project Tenement and Cypress Project Tenement.

 

  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 2.1 are satisfied or waived by the Agent in writing and ending on the earlier of:

 

(a)     the date which is [***] Business Days after the date on which all of the conditions precedent set out in clause 2.1 are satisfied or waived by the Agent in writing; and

 

(b)     the date on which the Tranche One Commitments are cancelled in full under this agreement; and

 

2    in respect of Tranche Two, subject to clause 2.2(a), the period commencing on the date on which all of the conditions precedent set out in clause 2.2(b) are satisfied or waived by the Agent in writing and ending on the earlier of:

 

(a)     the date which is [***] Business Days after the date on which all of the conditions precedent set out in clause 2.2(b) are satisfied or waived by the Agent in writing; and

 

(b)     the date on which the Tranche Two Commitments are cancelled in full under this agreement.

 

 

Term facility agreement       page 4


 

 

  21  General

 

  Term Meaning
  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

1    in respect of a Lender (other than an Alternative T2 Lender), on any day, the greater of:

 

   the United States Prime Rate on that day appearing on Bloomberg page PRIM (or any replacement Bloomberg page which displays that rate) or on the appropriate page of such other information service which publishes that rate from time to time in place of Bloomberg. If such page or service ceases to be available, the Agent may specify another page or service displaying the relevant rate after consultation with the Borrower; and

 

   the Federal Funds Target Rate on that day plus [***], provided that if the Federal Funds Target Rate on that day is a range then the highest rate in that range on that day will be the Federal Funds Target Rate; and

 

2    in respect of an Alternative T2 Lender, as set out in its Accession Certificate.

 

All calculations of rates for the purposes of this definition will be expressed as a yield percent per annum to maturity.

 

  Bill a bill of exchange as defined in the Bills of Exchange Act 1909 (Cth).
  Big River Supply Agreement the coal supply agreement between the Borrower and Big River Electric Corporation dated 28 January 2019
  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;

 

 

Term facility agreement       page 5


 

 

  21  General

 

  Term Meaning
   

2    for the purposes of the definition of Rate Set Date, a day on which banks are open for business in New York excluding a Saturday, Sunday or public holiday;

 

3    for the purposes of clause 9 and Schedule 9, a day on which banks are open for business in Sydney excluding a Saturday, Sunday or public holiday; and

 

4    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 (without double counting):

 

(a)     Project Costs (other than those costs referred to in paragraph (2) of the definition of Interest Cover Ratio); and

 

(b)     head office and discretionary expenditure in relation to the Project as detailed in the Life of Mine Plan,

 

for that period.

 

  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 on the Project Area.

 

Term facility agreement       page 6


 

 

  21  General

 

  Term Meaning
  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.

 

  Compliance Certificate a certificate in the form of Schedule 8.
  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.
  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 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).
  Current Ratio

on any Calculation Date, the ratio of:

 

1    Total Current Assets of the Obligors; to

 

2    Total Current Liabilities of the Obligors,

 

as of the close of that Calculation Date.

 

  Cypress Coal Mine the coal mine located in the Cypress Project Area and on the Cypress Project Tenements.

 

Term facility agreement       page 7


 

 

  21  General

 

  Term Meaning
  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 13.
  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.

 

  Debt Service Reserve Account the Dollar account opened or to be opened by the Borrower with an Account Bank, as renumbered, redesignated or replaced from time to time and as contemplated by clause 11.
  Default

1    an Event of Default; or

 

2    a Potential Event of Default.

 

  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.
  Dock Agreement the agreement dated 8 May 2015 between E.T. Woosley Farms, LLC and Hartshorne Land.

 

Term facility agreement       page 8


 

 

  21  General

 

  Term Meaning
  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 13.

 

  Dollars, US$, USD and $ the lawful currency of the US.
  Due Diligence Report

the following reports in respect of the Project:

 

1    the “Independent Technical Review of the Poplar Grove Mine” dated February 2017 and prepared by William G Meister; and

 

the following able to be relied on by the Finance Parties:

 

2    the legal due diligence report dated 5 May 2018 as updated and dated on or about the date of this agreement and prepared by Wyatt, Tarrant & Combs, LLP.

 

  Early Repayment Fee

in respect of the prepayment of any of the Principal Outstanding in relation to an outstanding Funding Portion, other than as a result of the exercise of the Equity Cure under clause 8.24 or as a result of any mandatory prepayment under clause 3.9:

 

1    at any time during the period commencing on the date of this agreement and ending on the date that is 1 year after the date of this agreement, [***];

 

2    at any time during the period commencing on the day after the date that is 1 year after the date of this agreement and ending on the date that is 2 years after the date of this agreement, [***]; or

 

3    at any time during the period commencing on the day after the date that is 2 years after the date of this agreement and ending on the date that is 3 years after the date of this agreement, [***],

 

calculated on the amount prepaid.

 

  EBITDA

for any period, an amount equal to net income of the Obligors for such period:

 

1    minus, to the extent included in such net income (but without duplication):

 

(a)   interest revenues; 

 

 

Term facility agreement       page 9


 

 

  21  General

 

  Term Meaning
   

(b)   any extraordinary, non-recurring or unusual income and gains (including, whether or not otherwise includable as a separate item in the calculation of net income, gains on sales outside of the ordinary course of business or on sale lease back transactions); and

 

(c)    any expense or payment in the nature of interest relating to any Equipment Finance Facility,

 

of the Obligors; and

 

2    plus, to the extent deducted from such net income (but without duplication):

 

(a)   Financing Costs;

 

(b)   income tax expense of the Obligors;

 

(c)    depreciation and amortization expense of the Obligors;

 

(d)   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

 

(e)   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;

 

 

Term facility agreement       page 10

 


 

  21  General

 

  Term Meaning
   

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 responsible under any Environmental Law or Mining Law; or

 

5    any agreement between an Obligor and any:

 

(a)     owner or occupier of land; or

 

(b)     Government Agency,

 

of or in respect of Reclamation, any Environmental Law or Mining Law, or Contamination of any Premises.

 

  Equipment Finance Facility* any equipment finance facility or facilities entered into by Hartshorne Mining with Komatsu Financial Limited Partnership and/or any other similar type of equipment supplier or equipment finance provider up to a maximum aggregate amount of [***] across all such facilities which is only secured against the relevant equipment and which is subject to an Equipment Finance Tripartite Agreement.
  Equipment Finance Tripartite Agreement

any of the following:

 

1    the document titled ‘Intercreditor Agreement’ to be entered into after the date of this agreement between the Security Trustee, Hartshorne Mining and Komatsu Financial Limited Partnership; and/or

 

2    any other tripartite or intercreditor agreement that is entered into between the Security Trustee, Hartshorne Mining and the provider of an Equipment Finance Facility.

 

  Equity equity or Subordinated Debt provided, directly or indirectly through another Obligor, to the Borrower by the Parent.
  Equity Cure has the meaning given to it in clause 8.24(b).
  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;

 

2    imposed as a result of a Finance Party being a resident of, or organised or doing business in, the jurisdiction imposing the tax; or 

 

 

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  Term Meaning
   

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 [***] 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 has the meaning given to it in clause 9.2(a)(1).
  Exercise Price has the meaning given to it in clause 9.1(e).
  Existing Facility Agreement the facility agreement dated 17 May 2018, between each Obligor and Macquarie Bank Limited, as amended from time to time and including on 31 August 2018 and 8 September 2018.
  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; or 

 

 

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  Term Meaning
   

2    in relation to a ‘passthru payment’ described in section 1471(d)(7) of the Code not falling within paragraph 1 of this definition, the first date from which such payment may become subject to a deduction or withholding required by FATCA.

 

  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.
  Federal Funds Target Rate means, for any day, the target rate on that day as determined by the Federal Open Market Committee. Where the target rate is a range, the Federal Funds Target Rate will be the higher of the rates quoted.
  Fee Letter

1    the Term Loan Facility Fee Letter;

 

2    the Security Trustee Fee Letter;

 

3    the Agent Fee Letter; or

 

4    any letter or letters on or after the date of this agreement between a Lender, the Agent or the Security Trustee and an Obligor setting out the fees payable by that Obligor 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 Account Bank Deed;

 

4    the Refinancing Deed;

 

5    each Security;

 

6    the Security Trust Deed;

 

7    each Substitution Certificate;

 

8    each Holding Statement;

 

9    each Tripartite Agreement;

 

10  each Irrevocable Payment Direction;

 

11  each LTE Appointment Deed;

 

12  each Subordination Deed; and

 

13  any other document which at any time the Agent and the Borrower agree is a Finance Document for the purposes of this agreement,

 

 

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  21  General

 

  Term Meaning
    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 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);

 

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; or

 

11  Guarantee in respect of any of the items referred to above,

 

and irrespective of whether the debt or liability:

 

(a)     is present or future;

 

(b)     is actual, prospective, contingent or otherwise;

 

(c)     is at any time ascertained or unascertained;

 

(d)     is owed or incurred alone or severally or jointly or both with any other person; or

 

(e)     comprises any combination of the above.

 

 

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  21  General

 

  Term Meaning
  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 Term Loan Facility, Principal Outstanding) or any amount 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 of the public enemy, strikes, lockouts, industry-wide labour shortages, labour disputes which cause work stoppages, industry-wide shortages of materials and supplies, fires, flood or earthquakes, and other similar events or occurrences; 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; and

 

2    the Annual 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 4.5.

 

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  Term Meaning
  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.
  Gregory Thomas Debt means the indebtedness owing by Hartshorne Land, LLC to Gregory Wayne Thomas under a property deed of conveyance dated 28 February 2018, such indebtedness not to exceed [***] plus accrued interest.
  Gregory Thomas Lien means the Encumbrance granted by Hartshorne Land, LLC in favour of Gregory Wayne Thomas over the property referred to in the deed of conveyance dated 28 February 2018 between Hartshorne Land, LLC and Gregory Wayne Thomas.
  Gross Debt

all Financial Indebtedness of the Obligors, including:

 

1    amounts drawn under the Term Loan Facility;

 

2    indebtedness under any Permitted Financial Indebtedness; and

 

3    any other amounts treated as Financial Indebtedness or its equivalent in the Parent’s audited consolidated financial statements,

 

but excluding:

 

4    indebtedness described in paragraph 1 of the definition of Permitted Financial Indebtedness;

 

5    Financial Indebtedness incurred in respect of any Equipment Finance Facility; and

 

6    any obligations owed to another Obligor.

 

  Group the group comprising each Obligor.
  Group Structure Diagram the group structure diagram in Schedule 7 as amended or updated by the delivery of a new diagram to the Agent under clause 8.1(h).

 

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  21  General

 

  Term Meaning
  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 (Cth).
  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.
  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 any 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 in favour of each Option Holder.

 

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  21  General

 

  Term Meaning
  Insolvency Event the occurrence of any event specified in clause 12.1(i).
  Interest Cover Ratio

in relation to any Calculation Date on or after [***], the ratio of:

 

1    CFADS for the Quarter ending on that Calculation Date; to

 

2    the aggregate of:

 

(a)     Interest Expense; and

 

(b)     interest and amounts in the nature of interest incurred in relation to any Permitted Financial Indebtedness other than interest and amounts in the nature of interest incurred under any Equipment Finance Facility,

 

for the Quarter ending on that Calculation Date.

 

  Interest Expense for any period, interest and amounts in the nature of interest incurred under or in relation to the Term Loan Facility for that period.
  Interest Payment Date the last day of each Quarter.
  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 Borrower’s Operating Account.
  IWT Cap on any day, the amount which is equal to [***] of the total interest paid or payable under this agreement in respect of half of the Total Commitments (but excluding any Tranche Two Commitment which, at the relevant time, is not or has not become an unconditional commitment under clause 2.2(a)), up to and including that day.
  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

1    the Original Lenders;

 

2    any person who is a Substitute Lender; and

 

3    any Alternative T2 Lender who has acceded to this agreement as a party by executing an Accession Certificate in accordance with clause 19.4.

 

  Lenders’ Technical Expert any technical engineer appointed by the Agent in accordance with clause 8.23(a).

 

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  Term Meaning
  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.
  Leverage Ratio

in relation to any Calculation Date on or after [***], the ratio of:

 

1    Gross Debt on that date; to

 

2    EBITDA for the 6 calendar months prior to that date, annualised.

 

  LGE/KU Louisville Gas and Electric Company and Kentucky Utilities Company.
  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

a life of mine plan which provides a summary of the forecast operation of the Project which:

 

1    is based on mining the Number 9 Seam first, as indicated in the applicable projections;

 

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;

 

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:

 

(a)     capital expenditure schedules and drawdown requirements;

 

(b)     mine plan and schedule for run of mine tons and Saleable Product;

 

(c)     bypass, washing and key Product specification assumptions;

 

(d)     capital, production and Project Costs;

 

(e)     Reclamation schedule;

 

(f)      cash flow; and

 

(g)     Taxes, royalties, administration costs and expenses; and

 

7    is divided into monthly periods for the first two years and Quarterly periods for the subsequent three years, and then annual periods for each subsequent year thereafter of the Project,

 

 

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  21  General

 

  Term Meaning
    as updated and amended from time to time as required under clause 8.1(f) and in accordance with clause 10.3. At the date of this agreement the Life of Mine Plan is Microsoft excel file named “Paringa Life of Mine Plan.xlsx”.
  Loss any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment.
  LTE Appointment Deed any deed entered into between any Lenders’ Technical Expert, the Borrower and the Agent.
  Majority Lenders Lenders whose Exposures aggregate more than 66 2/3rds of the aggregate Exposures.
  Margin

1    in respect of a Lender (other than an Alternative T2 Lender), [***] per annum; or

 

2    in respect of an Alternative T2 Lender, as set out in its Accession Certificate.

 

  Market Study the “Market Study for Paringa’s Poplar Grove Mine” dated February 2018 as updated following the date of this agreement and prepared by Energy Ventures Analysis.
  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 (individually or 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:

 

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  21  General

 

  Term Meaning
   

1    the development, operation or financing of the Project and the Project Assets as planned and required in accordance with the Life of Mine Plan and the Annual Budget; or

 

2    the conduct by the Obligor of its businesses, operations or the Project (including under Environmental Law and Mining Law),

 

at that time and includes each Authorisation referred to in Schedule 11 that is required at that time based on the Life of Mine Plan.

 

  Material Project Document

each of the following:

 

1    the Slope Contract;

 

2    the Dock Agreement;

 

3    any Supply Agreement;

 

4    any agreement relating to any Equipment Finance Facility;

 

5    each deed representing each Project Owned Property;

 

6    any document or contract which is material to the development, operation or financing of the Project and the Project Assets where the failure of such document or contract to have been executed, or the breach or non-performance of the terms and conditions of such document or contract would have, or would reasonably be expected to have, a Material Adverse Effect; and

 

7    any other document that the Agent and the Borrower agree in writing to be a Material Project Document.

 

  Maturity Date the date that is [***] years after the first Funding Date.
  Minimum Account Balance at any time, [***].
  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;

 

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; and

 

6    the Coal Industry Retiree Health Benefits Act of 1992,

 

 

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  21  General

 

   Term  Meaning
    and any comparable state and local laws or regulations.
  Nasdaq the Nasdaq Stock Market.
  Number 9 Seam the WKY number 9 coal seam located on the Project Area.
  Number 11 Seam the WKY 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, a director or a secretary of any person whose title includes the word ‘‘Director’, ‘Managing Director’, ‘Counsel’, ‘Attorney’, ‘President’, ‘Manager’ or ‘Vice President’, any officer (as that expression is defined in the Corporations Act) 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;

 

3    the Dollar account opened by the Borrower with an Account Bank; and

 

4    the Term Deposit Account,

 

in each case, as renumbered, redesignated or replaced from time to time.

 

  Option Expiry Date in respect of Options, the date [***] years from the Option Issue Date for those Options.
  Option Issue Date

1    in relation to the Options (First Issuance) has the meaning given to it in clause 9.1(a)(1); and

 

2    in relation to the Options (Second Issuance), has the meaning given to it in clause 9.1(a)(2).

 

 

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  21  General

 

  Term Meaning
  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 [***] 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 (or at the direction of) the Original Lenders rateably in accordance with their Pro Rata Share as at the date of this agreement in consideration of the Original Lenders providing the Term Loan Facility to the Borrower; and

 

4    the issue of which has been evidenced in a Holding Statement issued to each Option Holder on the same day as any Funding Portion under Tranche One is provided.

 

  Options (Second Issuance)

the [***] 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 (or at the direction of) the Original Lenders rateably in accordance with their Pro Rata Share as at the date of this agreement in consideration of the Original Lenders providing the Term Loan Facility to the Borrower; and

 

4    the issue of which will be evidenced in a Holding Statement issued to each Option Holder on the same day as the Options (Second Issuance) are granted in accordance with clause 9.1(a)(2).

 

  Option 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;

 

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:

 

 

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  Term Meaning
   

    ‘Funding Period’ are references to a period of the same length as any Funding Portion then outstanding or if no Funding Portion is then outstanding a period of [***] months;

 

    ‘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.

 

  Paringa Accounts

each of:

 

1    the Dollar account opened by the Parent with [***] with account number [***];

 

2    the Australian dollar accounts opened by the Parent with [***] with account numbers [***] and [***]; and

 

any other accounts opened by the Parent with another Account Bank.

 

  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 [***];

 

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 [***] 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;

 

 

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  Term Meaning
   

8    by way of an adjustment, discount or compromise made in the 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:

 

(a)   resolving any dispute with that third party; or

 

(b)   expediting the payment of any such accounts receivable having an original payment term of greater than [***] days,

 

provided that the aggregate of all such adjustments, discounts or compromises by Obligors does not exceed [***] 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:

 

(a)     the mineable and merchantable coal underlying such property has been exhausted;

 

(b)     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

 

(c)     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:

 

(a)   any resulting insurance proceeds are applied in accordance with clause 8.19; and

 

(b)   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:

 

(a)     the compensation is applied in accordance with clause 3.9; and

 

(b)     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 one of the Accounts.

 

 

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  Term Meaning
  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 the date of this agreement and any future coal royalties granted 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 any 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 [***];

 

 

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  Term Meaning
   

(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 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:

 

    the aggregate amount of all cash covered by Encumbrances falling within this paragraph is equal to or less than [***] at any time; and

 

    the Encumbrance is granted or exists in relation to Permitted Financial Indebtedness as described in paragraph 7 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 6 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 Gregory Thomas Lien;

 

9    the Encumbrances granted in favour of:

 

(a)     [***] as set forth in the Option Agreement for Purchase of Real Estate dated 20 December 2017 between Bryan Miles Stratton and Harshorne Land; and 

 

 

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  Term Meaning
   

(b)     [***] as set forth in the Option Agreement for Purchase of Real Estate dated 11 December 2017 between Miles Farms, LLC and Hartshorne Land; and

 

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:

 

(a)     perfected statutory landlord’s liens;

 

(b)     statutory liens for unpaid wages; and

 

(c)     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 to another Obligor;

 

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 any 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 [***] days (other than where payment is deferred because the amount to be paid is being contested by an Obligor in good faith on reasonable grounds to the Agent’s satisfaction (acting reasonably)) and where the aggregate of all such Financial Indebtedness for all Obligors outstanding at any time does not exceed [***] at any time;

 

2    any Financial Indebtedness incurred or permitted to be incurred under any Finance Document;

 

3    any Financial Indebtedness owing under Subordinated Debt where the aggregate of all such Financial Indebtedness owing under Subordinated Debt at any time does not exceed [***];

 

4    Financial Indebtedness incurred in respect of any Equipment Finance Facility;

 

5    any Financial Indebtedness owed by an Obligor to another Obligor;

 

6    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 [***] at any time, and provided that no overdraft facility will be permitted in respect of any bank account which is held with the Agent; 

 

 

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  Term Meaning
   

7    any Financial Indebtedness owing under the Surety Facility or in respect of any indemnity or reimbursement obligations in respect 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 [***];

 

8    unsecured Financial Indebtedness not falling within paragraphs 1 to 7 of this definition which in aggregate with the Financial Indebtedness of each other Obligor not falling within paragraphs 1 to 7 of this definition is equal to or less than [***] at any time;

 

9    the Gregory Thomas Debt; or

 

10  any other Financial Indebtedness approved by the Agent,

 

and includes a Guarantee of any amounts referred to in paragraphs 1 to 8 of this definition, inclusive.

 

  Permitted Sales Agreement

any agreement entered into by an Obligor for the sale of any Product from the Project which is entered into on terms:

 

1    that provide for a fixed price for Product sold of at least [***] per ton on a [***] BTU basis (and the parties agree that the fixed Price per ton for Product sold may be adjusted on a linear basis in accordance with the BTU content per ton of that Product); and

 

2    which are market standard and not unusually onerous on the Obligor.

 

  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.

 

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  Term Meaning
  PPSA the Personal Property Securities Act 2009 (Cth).
  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.
  Principal Outstanding in relation to the Term Loan Facility at any time, the aggregate principal amount of all outstanding Funding Portions under the Term Loan Facility at that time.
  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 13, 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:

 

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; 

 

 

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  21  General

 

  Term Meaning
   

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, 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;

 

10  Financing Costs;

 

11  amounts payable in connection with any Equipment Finance Facility;

 

12  discretionary capital expenditure related to the expansion of the Projects from [***] tons per annum to [***] tons per annum as set out in the Life of Mine Plan; and 

 

 

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  21  General

 

  Term Meaning
    13 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 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:

 

(a)     contract mining, earthmoving and crushing;

 

(b)     access and use of land in relation to the Project and infrastructure; or

 

(c)     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 ton of reserve will be received as projected in the Life of Mine Plan.
  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 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; 

 

 

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  21  General

 

  Term Meaning
   

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

1    when used in the context of a Lender’s participation in Tranche One at any time, the Tranche One Commitment of that Lender expressed as a percentage of the aggregate Tranche One Commitments of all Lenders at that time;

 

2    when used in the context of a Lender’s participation in Tranche Two at any time, the Tranche Two Commitment of any Lender that has given a written confirmation under clause 2.2(a) or of any Alternative T2 Lender, in each case expressed as a percentage of the aggregate Tranche Two Commitments of all such Lenders at that time;

 

3    when used in the context of a Lender’s participation in the Term Loan Facility more generally at any time, the Commitment of that Lender expressed as a percentage of the Total Commitments at that time, including any conditional Tranche Two Commitment notwithstanding that no Lender has provided any written confirmation under clause 2.2(a) at the relevant time; and

 

4    when used in the context of clause 6.12(b) at any time, the Commitment of that Lender expressed as a percentage of the Total Commitments at that time, but excluding any conditional Tranche Two Commitment of a Lender to the extent that Lender has not provided the written confirmation under clause 2.2(a) at the relevant time.

 

  Quarter a period of 3 months ending on a Quarter Date.
  Quarter Date each 31 March, 30 June, 30 September and 31 December.

 

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  21  General

 

  Term Meaning
  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.

 

  Ramp Up Test

the Project has demonstrated for [***] consecutive months of operation that:

 

1    Product sales meeting the requirements of the Supply Agreements exceed [***] tons in each month in that [***] month period;

 

2    Product sales in the second month exceed Product sales in the first month (adjusted for the number of days on which Product is or is scheduled to be produced at the Project);

 

3    the all-in unit costs in respect of each month are not more than [***] of those forecast in the Annual Budget;

 

4    the Total Product Yield is not less than [***] in each month; and

 

5    the Illinois Basin [***] BTU spot coal price is greater than [***] per ton.

 

  Rate Set Date in relation to a Funding Period, two Business Days before the first day of that Funding Period.
  Ratio

1    the Current Ratio;

 

2    the Interest Cover Ratio;

 

3    the Reserve Tail Ratio; or

 

4    the Leverage 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.

 

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  21  General

 

  Term Meaning
  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.
  Refinancing Deed the deed to be entered into by Macquarie Bank Limited and the Finance Parties in relation to the refinancing of the amounts owing under the Existing Facility Agreement.
  Related Body Corporate a related body corporate as defined in section 50 of the Corporations Act.
  Related Fund In relation for a fund (the first fund) means a fund which is managed or advised by the Agent, Tribeca Investment Partners Pty Ltd or an entity Controlled by Tribeca Investment Partners Pty Ltd.
  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).
  Relevant Supply Date

the later of:

 

1    the first day of the calendar month following the date that is [***] months after the Borrower has made the initial capital expenditure related to the Third Production Unit; and

 

2    1 January 2020.

 

  Remedy Period has the meaning given to it in clause 12.5(c)(1).
  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 divided by:

 

1    the total proved and probable reserves at the commencement of the Project (as stated in the Life of Mine Plan at Financial Close); or 

 

 

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  21  General

 

  Term Meaning
   

2    the total proved and probable reserves in a subsequent revision of the Life of Mine Plan (which has been approved by the Agent for use in this calculation).

 

  Resources and Reserves Statement the statement prepared by Marshall, Miller & Associates as updated in March 2017 including the Project’s coal resources and reserves prepared in accordance with the JORC Code 2012.
  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 (other than payments for goods supplied or services rendered to an Obligor on arms’ length terms) to any holder of share capital of the Parent.

 

  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;

 

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), 

 

 

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  Term Meaning
    but excluding (i) any insurance proceeds (other than from business interruption insurance cover); (ii) any proceeds of Financial Indebtedness and Equity; and (iii) any amounts received by an Obligor under any Equipment Finance Facility, in each case received in that period.
  Review Event has the meaning given in clause 12.5(a).
  Saleable Product Product that is, or is eligible to be, sold pursuant to Permitted Sales Agreement, or any Product that is not earmarked to be sold under a specific Permitted Sales Agreement but which would satisfy the coal specifications under an existing Permitted Sales Agreement at that time.
  Same Day Funds a bank cheque or other immediately available (and freely transferable) funds.
  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

 

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  Term Meaning
    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;

 

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.
  Security Trustee Fee Letter the fee letter dated on or about the date of this agreement between the Borrower and the Security Trustee for the purpose of clause 6.24 (Fees) of the Security Trust Deed.
  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.

 

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  Term Meaning
  Slope Contractor Frontier-Kemper Constructors, Inc.
  Subordinated Debt any Financial Indebtedness made available to an Obligor which is subordinated to the Term Loan Facility pursuant to a Subordination Deed.
  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 entity (the holding company) if:

 

(a)     the holding company owns, directly or indirectly, more than 50% of the equity or ordinary voting power in that entity; or

 

(b)     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;

 

2    the AEP Supply Agreement;

 

3    the Big River Supply Agreement; and

 

4    any other Permitted Sales Agreement.

 

  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; 

 

 

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   Term  Meaning
   

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 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.
  Term Deposit Account the Dollar term deposit account opened by the Borrower with any Account Bank, as renumbered, re-designated or replaced from time to time.
  Term Loan Facility

the $56,000,000 loan facility made available by the Lenders to the Borrower under this agreement in 2 tranches:

 

1    Tranche One; and

 

2    Tranche Two.

 

  Third Production Unit means the third production unit to be constructed for the Project.
  Term Loan Facility Fee Letter the fee letter titled ‘Poplar Grove Coal Mine Term Facility Agreement – Term Loan Facility Fee Letter’ dated on or about the date of this agreement between the Borrower and the Agent.
  Threshold All in Unit Costs

the aggregate of the amounts calculated in accordance with this definition:

 

1    for each month during the relevant period prior to [***], [***] of the forecast All in Unit Costs for producing Saleable Product as set out in the Life of Mine Plan for that month; and 

 

 

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   Term  Meaning
   

2    for each month during the relevant period after [***], [***] of the forecast All in Unit Costs for producing Saleable Product as set out in the Life of Mine Plan for that month.

 

  Threshold Saleable Product

the aggregate of the amounts calculated in accordance with this definition:

 

1    for each month during the relevant period prior to [***], [***] of the forecast Saleable Product to be produced from the Project for that month as set out in the Life of Mine Plan; and

 

2    for each month during the relevant period after [***], [***] of the forecast Saleable Product to be produced from the Project for that month as set out in the Life of Mine Plan.

 

  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 Current Assets the aggregate amount of the total current assets of each Obligor as of the applicable Calculation Date, as shown in or determined by reference to (as applicable) the most recent Financial Report given to the Agent or other financial statements prepared by the Obligors in accordance with this agreement, but excluding any cash of an Obligor which collateralises obligations in respect of surety bonds, performance bonds, letters of credit, bank guarantees or other similar instruments.
  Total Current Liabilities

the aggregate amount of the total current liabilities of each Obligor as of the applicable Calculation Date, as shown in or determined by reference to (as applicable) the most recent Financial Report given to the Agent or other financial statements prepared by the Obligors in accordance with this agreement, excluding:

 

1    Principal Outstanding under the Term Loan Facility;

 

2    any principal amount outstanding as described in paragraph 3 of the definition of Permitted Financial Indebtedness; and

 

3    amounts payable under any Equipment Finance Facility for the [***] – [***] month (inclusive) of the following 12 month period.

 

  Total Product Yield

in respect of a calendar month, the ratio of:

 

1     Marketable Product Tons, being the number of tons that are capable of being used to satisfy sales of Product under any of the Supply Agreements for that month; to 

 

 

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   Term  Meaning
   

2     Raw Coal Production Tons, being the run of mine coal production delivered to the raw coal stockpile for that month.

 

  Total Undrawn Commitments at any time, the aggregate of the Undrawn Commitment (Term Loan) of the Lenders at that time.
  Total Undrawn Tranche One Commitments at any time, the aggregate of the Undrawn Commitment (Tranche One) of the Lenders at that time.
  Total Undrawn Tranche Two Commitments at any time, the aggregate of the Undrawn Commitment (Tranche Two) of the Lenders at that time.
  Tranche One the $40,000,000 tranche of the Term Loan Facility made available under this agreement.
  Tranche One Commitment

1     in relation an Original Lender, the Tranche One Commitment set out in Schedule 2 in respect of that Original Lender; 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 subject to clause 2.2(a), the uncommitted $16,000,000 tranche of the Term Loan Facility made available under this agreement.
  Tranche Two Commitment

subject to clause 2.2(a):

 

1     in relation to an Original Lender, the Tranche Two Commitment set out in Schedule 2 in respect of that Original Lender;

 

2     in relation to an Alternative T2 Lender, the Tranche Two Commitment set out in its Accession Certificate; and

 

3     in relation to any other Lender, the amount of Tranche Two Commitment transferred to it under this agreement,

 

to the extent not cancelled, reduced or transferred by it under this agreement.

 

  Tranche Two Funding Gap

at any time, an amount which is equal to the difference (if any) between: 

 

 

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   Term  Meaning
   

1    the Tranche Two Commitment; and

 

2    the aggregate sum of:

 

    the Tranche Two Commitment of each Lender that has provided the written confirmation contemplated under clause 2.2(a); and

 

    the Tranche Two Commitment of each Alternative T2 Lender.

 

  Tripartite Agreement

1    the Equipment Finance Tripartite Agreement; and

 

2    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 (Term Loan) in respect of a Lender at any time, the Commitment of that Lender at that time less the Principal Outstanding provided by that Lender under the Term 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.
  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 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; 

 

 

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   Term  Meaning
   

4    UCC-1s from each Obligor organised in the State of Delaware and registered with the Delaware Secretary of State; and

 

5    each Account Bank Deed in favour of the Security Trustee.

 

  US Obligor

1    Hartshorne Holdings, LLC;

 

2    Hartshorne Mining Group, LLC;

 

3    Hartshorne Mining; and

 

4    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;

 

(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;

 

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(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; and

 

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

 

(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).

 

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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 Accounting Standards

 

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

 

1.8 Limitation on liability of Equity Trustees Limited

 

(a) Equity Trustees Limited (ABN 46 004 031 298) (Trustee) has entered into this agreement in its capacity as trustee of the Tribeca Global Natural Resources Credit Fund (Fund) and not in its personal capacity, or in its capacity as trustee of any trust other than the Fund.

 

(b) A liability of the Trustee arising under or in connection with this agreement is strictly limited, and can only be enforced against the Trustee, to the extent to which it can be satisfied out of the assets of the Fund or the Trustee is actually indemnified for the liability. This limitation will not apply to any obligation or liability of the Trustee only to the extent that it is not so satisfied because there is a reduction in the extent of the Trustee's indemnification out of the assets of the Fund caused by the Trustee's fraud, wilful default or gross negligence.

 

(c) Subject to clause 1.8(e), a party may not take any step to:

 

(1) have an administrator appointed to the Trustee;

 

(2) have a receiver appointed to the Trustee, other than a receiver of all or part of the assets of the Fund only;

 

(3) have the Trustee wound up, or prove in any winding up of the Trustee;

 

(4) obtain a judgment against the Trustee for the payment of money;

 

(5) carry out any distress or execution on any property of the Trustee; or

 

(6) exercise any:

 

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  21  General

 

(A) right of set-off;

 

(B) right to combine or consolidate accounts; or

 

(C) banker's lien,

 

against the Trustee in connection with the Trustee's obligations under or in connection with this agreement.

 

(d) Subject to clause 1.8(e), a party to this agreement has no rights against or recourse to any related body corporate, shareholder, director, officer, employee, attorney, agent or other controlling person of the Trustee in connection with the Trustee's obligations under or in connection with this agreement.

 

(e) The other provisions of this clause do not affect a right to:

 

(1) proceed against the Trustee or the Fund to the extent necessary to obtain the benefit of the recourse allowed by this clause;

 

(2) obtain an injunction, restraining order or declaration concerning the Fund or the Trustee's obligations under or in connection with this agreement; and

 

(3) proceed against the Trustee or the Fund following, or the liability of the Trustee in respect of, any fraud, wilful default or gross negligence of the Trustee.

 

(f) Nothing in clause 1.8(e) shall make the Trustee liable to any claim for an amount greater than the amount which the other parties would have been able to claim and recover from the assets of the Fund in relation to the relevant liability if the Trustee's right of indemnification out of the assets of the Fund had not been prejudiced by the Trustee's fraud, wilful default or gross negligence.

 

(g) This clause applies despite any other provisions of this agreement or any principle of equity or law to the contrary.

 

1.9 Security Trust Deed

 

(a) This agreement is entered into subject to, and with the benefit of, the terms of the Security Trust Deed.

 

(b) Notwithstanding anything to the contrary in this agreement, the terms of the Security Trust Deed will prevail if there is a conflict between the terms of this agreement and the terms of the Security Trust Deed.

 

(c) The fact that a provision of this agreement is expressed to be subject to the terms of the Security Trust Deed does not mean, and will not be taken to mean, that any other provision of this agreement is not so subject.

 

1.10 Capacity of Security Trustee

 

(a) The Security Trustee enters into this agreement as trustee of the Security Trust established under the Security Trust Deed.

 

(b) Clause 1.7 (Security Trustee’s limitation of liability) of the Security Trust Deed is incorporated in this agreement as if set out in full, mutatis mutandis.

 

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2 Conditions precedent

 

2.1 Conditions precedent to Financial Close and Tranche One

 

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 under Tranche One 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 [***] Business Days before the first Funding Date;

 

(b) Finance Documents: originals of each of the following Finance Documents:

 

(1) this agreement;

 

(2) each Fee Letter;

 

(3) each Account Bank Deed;

 

(4) the Refinancing Deed;

 

(5) each Security;

 

(6) the Security Trust Deed;

 

(7) each Tripartite Agreement; and

 

(8) each Irrevocable Payment Direction,

 

in each case duly executed by all parties to them other than the Finance Parties and, where applicable:

 

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

 

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

 

(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 on or before the date which is [***] days after Financial Close in accordance with clause 8.18(c);

 

(d) Project Documents: a certified copy of each Project Document other than each Project Tenement and Cypress Project Tenement, 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 or, in the case of title documents in the possession of Macquarie Bank Limited, evidence that those Title Documents will be delivered to the relevant Finance Party at or within an agreed period after Financial Close;

 

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

 

(g) Financial Reports: a certified copy of the most recent Financial Report and semi-annual consolidated financial statements of the Parent and the Obligors on a combined basis;

 

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  21  General

 

(h) Annual Budget: a certified copy of the initial Annual Budget;

 

(i) Life of Mine Plan: a certified copy of the current Life of Mine Plan;

 

(j) Ratios: the Life of Mine Plan demonstrates that the Obligors are in compliance with clause 8.24;

 

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

 

(l) enquiries: results of searches, enquiries and requisitions in respect of each Obligor and the Secured Property;

 

(m) 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;

 

(n) opinions: a legal opinion addressed to the Agent, the Security Trustee and each 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 any 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 any LTE Appointment Deed to which it is a party and which is entered into on or before Financial Close;

 

(o) 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;

 

(p) Supply Agreements: the Borrower has provided a representation in its officer's certificate provided under clause 2.1(a) stating that it is in compliance with its obligations under the LGE/KU Supply Agreement as at the date of such certificate;

 

(q) Irrevocable Payment Direction: evidence that the Borrower has delivered, or will deliver within an agreed period after Financial Close, an Irrevocable Payment Direction to the purchaser under any Supply Agreement requiring payment into the Borrower’s Operating Account;

 

(r) 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;


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  21  General

 

(s) 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;

 

(t) 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;

 

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

 

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

 

(v) Project Tenements: evidence that:

 

(1) the Project Obligors have entered into and hold (i) [***] of all applicable Project Tenements applicable to the first [***] years of mineable Product for the Project and (ii) [***] of the applicable Project Tenements for the first [***] years of mineable production for the Project; and

 

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

 

(A) have expiry dates after the year [***]; and

 

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

 

(w) 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 development, operation or financing of the Project and the Project Assets as planned and required in accordance with the Life of Mine Plan that:

 

(i) will not be obtained as and when required in the ordinary course and in a timely manner in accordance with the Life of Mine Plan;

 

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  21  General

 

(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 Budget or the Life of Mine Plan as at Financial Close;

 

(x) 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 7 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;

 

(y) no Encumbrance: evidence that no Encumbrance has been granted over any of the assets of the Obligors other than the Permitted Encumbrances and any Encumbrance which was granted by an Obligor to secure obligations under the Existing Facility Agreement;

 

(z) no Financial Indebtedness: evidence that the Obligors have not incurred any Financial Indebtedness other than Permitted Financial Indebtedness and Financial Indebtedness incurred under the Existing Facility Agreement;

 

(aa) establishment of the Accounts: evidence that the Accounts (other than the Debt Service Reserve Account and the Term Deposit Account) have been established and that the Minimum Account Balance has been deposited into or otherwise stands to the credit of those Accounts (or will be funded from first drawdown);

 

(bb) 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 the date of the Financial Report delivered under clause 2.1(g) or from the information provided to the Lenders prior to the date of this agreement;

 

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

 

(dd) Existing Facility Agreement: evidence that:

 

(1) the Commitment (as defined in the Existing Facility Agreement) has been cancelled and repaid in full or will be cancelled and repaid in full; and

 

(2) any Encumbrance which was granted by an Obligor to secure obligations under the Existing Facility Agreement has been released or will be released,

 

contemporaneously with first drawdown under this agreement in accordance with the terms of the Refinancing Deed; and

 

(ee) 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 Two

 

(a) The parties acknowledge and agree that, notwithstanding any other term of this agreement, Tranche Two of the Term Loan Facility is a conditional facility and each Lender (other than an Alternative T2 Lender) will not be obliged to participate in Tranche Two of the Term Loan Facility unless that Lender has provided written confirmation to the Agent and the Borrower that the relevant Lender has available to it sufficient funds prior to the first Funding Portion under Tranche Two in order for the relevant Lender to provide its Commitment or its Pro Rata Share of any Funding Portion under Tranche Two of the Term Loan Facility. Upon a Lender providing such written confirmation under this clause 2.2(a), its obligation to provide its Commitment or its Pro Rata Share of any Funding Portion under Tranche Two of the Term Loan Facility shall become unconditional subject only to the conditions specified in clause 2.2(b).

 

(b) Without limiting clause 2.2(a), 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:

 

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

 

(2) the Borrower has provided a representation in its Funding Notice in respect of Tranche Two that it is in compliance with its obligations under each Supply Agreement as at the date of that Funding Notice;

 

(3) evidence that the Borrower has satisfied the Ramp Up Test;

 

(4) evidence that the Debt Service Reserve Account has been established;

 

(5) confirmation from the Borrower that no amendments or variations are required to be made to the Annual Budget or the Life of Mine Plan provided to the Agent under clause 2.1 or, to the extent that the Annual Budget or the Life of Mine Plan have been amended in accordance with clause 10.3, are in form and substance satisfactory to the Agent;

 

(6) Tranche One of the Term Loan Facility has been fully drawn; and

 

(7) a copy of the Market Study in a form and substance satisfactory to the Agent.

 

2.3 Alternative lender for Tranche Two

 

Notwithstanding anything to the contrary in any Finance Document, the parties acknowledge and agree as follows:

 

(a) Until such time that the Tranche Two Funding Gap is zero, the Borrower shall have the right to obtain a binding loan commitment from another lender or lenders (each such lender, an Alternative T2 Lender) for an amount up to the Tranche Two Funding Gap at that time provided that each Alternative T2 Lender who chooses to participate in Tranche Two accedes as a party to this agreement by executing an Accession Certificate in accordance with clause 19.4 and accedes as a party to the Security Trust Deed in accordance with the terms of that document.

 

(b) The Borrower may agree separate pricing terms in relation to each Alternative T2 Lender’s participation in Tranche Two, notwithstanding that those separate pricing terms may be different to the existing pricing terms that apply to Tranche Two under this agreement.

 

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(c) To the extent that an Alternative T2 Lender has acceded as a party to this agreement, the Commitment of each Lender (other than each Alternative T2 Lender) under Tranche Two who has not provided a notice under clause 2.2(a) will be reduced rateably in accordance with each Alternative T2 Lender’s participation in Tranche Two.

 

(d) The parties agree to enter into such documentation as may be reasonably requested by the Borrower in order to give effect to this clause 2.3 (including to enable any Alternative T2 Lender to accede to this agreement and the Security Trust Deed).

 

2.4 Conditions precedent to all Funding Portions

 

Without limiting clause 2.1 or 2.2, 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) Funding Date: the Funding Date for the Funding Portion is a Business Day within the Availability Period;

 

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

 

(d) 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;

 

(e) 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

 

(f) 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 and 2.2 to be a true copy of the original document. The certification must be made no more than [***] 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.

 

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3 Commitment, purpose and availability of Term Loan Facility

 

3.1 Provision of Commitment

 

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

 

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 Term Loan Facility only for:

 

(a) refinancing the Financial Indebtedness of the Obligors under the Existing Facility Agreement;

 

(b) payment of Project Costs; and

 

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

 

3.4 Cancellation of Commitment during Availability Period

 

(a) The Borrower may cancel:

 

(1) prior to the date on which Tranche One of the Term Loan Facility has been drawn, that part of the Total Undrawn Commitments which exceeds [***]; or

 

(2) on or after the date on which Tranche One of the Term Loan Facility has been drawn, all or part of the Total Undrawn Tranche Two Commitments,

 

by giving the Agent at least [***] Business Days’ notice.

 

(b) The Commitment of a Lender is cancelled to the extent of its Pro Rata Share of the Total Undrawn Commitments that are cancelled.

 

(c) 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.

 

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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 [***] Business Days’ prior notice specifying:

 

(1) the prepayment date; and

 

(2) the relevant Funding Portion which is to be prepaid in whole or in part (provided that any prepayment must be applied to the Funding Portion under Tranche One until there is no outstanding Funding Portion under Tranche One).

 

(b) Prepayment of part of the Principal Outstanding under clause 3.6(a) may only be made in a minimum amount of [***].

 

(c) The Borrower must prepay the Principal Outstanding specified in the prepayment notice on the prepayment date specified in the notice together with:

 

(1) all unpaid interest or fees accrued to the prepayment date in respect of the prepaid amount; and

 

(2) the Early Repayment Fee required to be paid under clause 15.2(a).

 

(d) The Commitment of a Lender under the Term 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.

 

(e) 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 – Equity Cure

 

(a) 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 Term Loan Facility.

 

(b) The Borrower is not required to pay any Early Repayment Fee under clause 15.2(a) in respect of a prepayment under this clause 3.8.

 

(c) The Commitment of a Lender under the Term Loan Facility is reduced by its Pro Rata Share of any amount of Principal Outstanding prepaid under this clause 3.8 and accordingly a prepaid amount may not be redrawn.

 

3.9 Mandatory prepayment – Compulsory acquisition

 

(a) 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 Term Loan Facility together with all unpaid interest or fees accrued to the prepayment date in respect of the prepaid amount.

 

(b) The Borrower is not required to pay any Early Repayment Fee under clause 15.2(a) in respect of a prepayment under this clause 3.9.

 

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(c) The Commitment of a Lender under the Term Loan Facility is reduced by its Pro Rata Share of any amount of Principal Outstanding prepaid under this clause 3.9 and accordingly a prepaid amount may not be redrawn.

 

3.10 Mandatory prepayment – Debt Service Reserve Account

 

(a) If the balance standing to the credit of the Debt Service Reserve Account is equal to or greater than the Principal Outstanding in respect of Tranche Two, the Borrower may request the withdrawal of the balance standing to the credit of the Debt Service Reserve Account to prepay any of the Principal Outstanding under the Term Loan Facility by giving the Agent at least [***] Business Days’ prior notice specifying:

 

(1) the amount to be withdrawn, which amount must be in accordance with clause 11.5(d)(2);

 

(2) the prepayment date; and

 

(3) the relevant Funding Portion which is to be prepaid in whole or in part.

 

(b) The amount withdrawn from the Debt Service Reserve Account in accordance with clause 11.5(d)(2) must be applied to prepay the Principal Outstanding under the Term Loan Facility together with:

 

(1) all unpaid interest or fees accrued to the prepayment date in respect of the prepaid amount; and

 

(2) the Early Repayment Fee required to be paid under clause 15.2(a).

 

(c) The Commitment of a Lender under the Term Loan Facility is reduced by its Pro Rata Share of any amount of Principal Outstanding prepaid under this clause 3.10 and accordingly a prepaid amount may not be redrawn.

 

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 [***] 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 6; and

 

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


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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 Funding Portions

 

The Borrower may only draw one Funding Portion under Tranche One and one Funding Portion under Tranche Two.

 

4.5 Funding Periods

 

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

 

(1) the first Funding Period for a Funding Portion under the Term 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 Term 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 Term Loan Facility may end after the Maturity Date.

 

4.6 Consolidation and division of Funding Portions under Term Loan Facility

 

If two Funding Portions under the Term 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.

 

4.7 Determination of Funding Rate

 

(a) The Agent must notify each Lender and the Borrower of the Funding Rate for a Funding Period under the Term Loan Facility as soon as reasonably practicable, and in any event within [***] 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.

 

4.8 Market disruption – Term Loan Facility

 

(a) If the Agent determines that a Market Disruption Event occurs in relation to a Funding Portion under the Term 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

 

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(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.

 

(b) Each Lender shall determine the rate notified by it under clause 4.8(a)(2) in good faith. The rate so notified will be conclusive and binding on the parties in the absence of manifest error.

 

(c) Definitions relevant for this clause 4.8:

 

(1) In this agreement Market Disruption Event means before [***] 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 [***] 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).

 

(2) In this clause 4.8, each reference to Lender shall be a reference to a Lender (as defined in clause 1.2) which funds itself in the interbank market.

 

4.9 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 [***] days) with a view to agreeing a substitute basis for determining the rate of interest.

 

(b) Any alternative basis agreed under clause 4.9(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 4.9.

 

4.10 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 4.8 or 4.9; and

 

(2) if there is a Market Disruption Event under clause 4.8, the identity of any Lender or Lenders giving a notification under that clause.

 

(b) Subject to clause 4.10(d), 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 clause 4.10(a).

 

(c) Subject to clause 4.10(d), 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.

 

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(d) The Agent, the Borrower or (in either case) its officers or employees may disclose such information:

 

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

 

(2) to the extent it reasonably deems necessary in connection with any actual or contemplated proceedings or a claim with respect to clauses 4.8 or 4.9.

 

(e) A Lender who gives a notification under clause 4.8(c) at any time before [***] 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 4.8(c) (without giving details) and the Agent shall promptly comply with the request.

 

4.11 Prepayment of Affected Lender

 

(a) If any Lender gives notice under clause 4.8(c) in respect of a Market Disruption Event (Affected Lender), the Borrower may, at any time before the expiry of the Availability Period for the Term 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 clause 4.11(a), the Commitment of that Lender shall immediately be reduced to zero.

 

(c) The Borrower must prepay the relevant Principal Outstanding of that Lender within [***] Business Days of giving notice in accordance with clause 4.11(a).

 

(d) Clauses 3.6(c) to (e) (inclusive) and 3.7 will apply to any amount prepaid in accordance with this clause 4.11 as if such amount were a prepayment for the purposes of clause 3.6.

 

5 Term Loan Facility

 

5.1 Provision of Funding Portions

 

If the Borrower gives a Funding Notice in respect of the Term Loan Facility, each Lender must provide to the Agent its Pro Rata Share of each specified Funding Portion under the Term Loan Facility in Same Day Funds in Dollars no later than 11 am 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 Term 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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(b) 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 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:

 

(1) but excluding, the last day of the Funding Period; or

 

(2) if earlier than the last day of the Funding Period, the date of prepayment or repayment of the Funding Portion under this agreement.

 

(c) The Borrower must pay accrued interest in arrears to the Agent on each Interest Payment Date.

 

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 [***] 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.

 

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).

 

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6.4 Additional payments

 

If:

 

(a) any Obligor is required to make a deduction or withholding in respect of Tax (other than an 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 an 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 [***] 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:

 

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

 

(b) the Finance Party has obtained, utilised and retained that Tax Credit,

 

then the Finance Party must pay an amount to the Obligor which the Finance Party determines will leave it (after that payment) in the same after-Tax position as it would have been in had the additional payment not been made by the Obligor.

 

6.7 Tax affairs

 

Nothing in clause 6.6:

 

(a) interferes with the right of any Finance Party to arrange its tax affairs in any manner it thinks fit;

 

(b) obliges any Finance Party to investigate the availability of, or claim, any Tax Credit; or

 

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(c) obliges any Finance Party to disclose any information relating to its tax affairs or any tax computations.

 

6.8 FATCA Deduction

 

(a) Each party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no party will be required to increase any payment in respect of which it makes a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

 

(b) Each party must as soon as reasonably practicable after it becomes aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of the FATCA Deduction) notify the party to whom it is making the payment and, in addition, must notify the Borrower, the Agent and the other Finance Parties.

 

6.9 FATCA Information

 

(a) Each party will, within [***] Business Days of a reasonable request by another party:

 

(1) confirm to that other party whether or not it is a FATCA Exempt Party; and

 

(2) provide to that other party the information relating to its status under FATCA which the other party reasonably considers necessary to comply with or to demonstrate compliance with FATCA;

 

(b) If a party confirms to another party under clause 6.9(a) that it is a FATCA Exempt Party that party must notify the other party as soon as reasonably practical after it becomes aware that it is not, or has ceased to be, a FATCA Exempt Party.

 

(c) Clause 6.9(a)(2) will not oblige a Finance Party to do anything which may in its reasonable opinion constitute a breach of:

 

(1) any law or regulation;

 

(2) any fiduciary duty; or

 

(3) any duty of confidentiality.

 

(d) If a party fails to confirm whether or not it is a FATCA Exempt Party or to supply documentation or other information requested in accordance with clause 6.9(a) (including where clause 6.9(c) applies), then that party will be treated for the purposes of the Finance Documents as if it is not a FATCA Exempt Party until the party provides the requested confirmation, documentation or other information.

 

(e) If the Borrower is a US Tax Obligor or the Agent reasonably believes that its obligations under FATCA or any other applicable law or regulation require it, each Lender will, within [***] Business Days of:

 

(1) where the Borrower is a US Tax Obligor and the relevant Lender is an Original Lender, the date of this agreement;

 

(2) where the Borrower is a US Tax Obligor on a Transfer Date and the relevant Lender is a Substitute Lender, the relevant Transfer Date; or

 

(3) where the Borrower is not a US Tax Obligor, the date of a request from the Agent,

 

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supply to the Agent:

 

(4) a withholding certificate on Form W-8, Form W-9 or any other relevant form; or

 

(5) any withholding statement or other document, authorisation or waiver as the Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation.

 

(f) The Agent will provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender in accordance with clause 6.9(e) to the Borrower.

 

(g) If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Agent by a Lender under clause 6.9(e) is or becomes materially inaccurate or incomplete, the Lender will promptly update it and provide such updated withholding certificate, withholding statement, document, authorisation or waiver to the Agent unless it is unlawful for the Lender to do so (in which case the Lender will promptly notify the Agent). The Agent will provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the Borrower.

 

(h) The Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from the Lender under clauses 6.9(e) or (g) above without further verification. The Agent will not be liable for any action taken by it under or in connection with clauses 6.9(e), (f) or (g) above.

 

6.10 Amounts payable on demand

 

If any amount payable by an Obligor under any Finance Document is not expressed to be payable on a specified date, that amount is payable by the Obligor on or before the date which is [***] Business Days of demand by the Agent.

 

6.11 Appropriation of payments

 

(a) Except where clause 6.11(b) applies, all payments made by an Obligor under a Finance Document may be appropriated as between principal, interest and other amounts as the Agent determines or, failing any determination, in the following order:

 

(1) first, towards reimbursement of all fees, costs, expenses, charges, damages and indemnity payments due and payable by the Obligors under the Finance Documents;

 

(2) second, towards payment of interest due and payable under the Finance Documents; and

 

(3) third, towards repayment or prepayment of the Principal Outstanding.

 

(b) Any money recovered by a Finance Party as a result of the exercise of a Power under a Security must be appropriated in the manner provided in that Security.

 

(c) Any appropriation under clauses 6.11(a) or (b) overrides any appropriation made by an Obligor.

 

6.12 Distribution by Agent

 

(a) A payment received by the Agent under a Finance Document is received by the Agent on account of the Lenders unless:


 

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(1) the payment is made to the Agent for its own account; or

 

(2) a provision in a Finance Document expressly provides otherwise.

 

(b) The Agent must promptly distribute amounts received on account of the Lenders among them in their respective Pro Rata Shares and in the same type of funds as received by the Agent.

 

6.13 Non-receipt of funds by Agent

 

(a) If:

 

(1) the Agent elects to make a payment (Agent Payment) to any party (Payee) that is to be made out of a payment (Payer Payment) due to the Agent by another party (Payer) before the Agent has received the Payer’s Payment; and

 

(2) the Payer does not in fact make the Payer’s Payment to the Agent on the due date,

 

the Payee must repay the Agent Payment to the Agent on demand.

 

(b) The Payer indemnifies the Agent and the Payee against any Loss suffered or incurred by the Agent or the Payee as a result of any failure by the Payer to make the Payer Payment when due.

 

6.14 Redistribution of payments

 

(a) If a Lender receives or recovers an amount from an Obligor under the Finance Documents other than in accordance with clause 6.12:

 

(1) the Lender must advise the Agent that it has received or recovered the amount within [***] Business Days after the receipt or recovery;

 

(2) the Lender must within [***] Business Days after demand by the Agent pay to the Agent the amount determined by the Agent to be equal to the amount (excess amount) by which the amount received or recovered exceeds the amount the Lender would have received if the amount had been paid to the Agent and distributed in accordance with clause 6.12;

 

(3) the Agent must treat the payment of the excess amount as if it were a payment by the Obligor to the Agent on account of all the Lenders and promptly distribute the excess amount to the other Lenders in accordance with clause 6.12; and

 

(4) as between each Obligor and the Finance Parties, the excess amount is to be treated as not having been paid to the Lender, but as having been paid to all the Lenders in accordance with their respective entitlements.

 

(b) If an amount to which clause 6.14(a) applies is subsequently required to be repaid by the Lender who originally received or recovered it to an Obligor, each Finance Party which has received any part of it must repay that part to the Lender who originally received or recovered it, and the adjustments under clause 6.14(a)(4) will be reversed.

 

6.15 Rounding

 

The Agent may round amounts to the nearest unit of Relevant Currency in making any allocation or appropriation under the Finance Documents.

 

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6.16 Currency exchanges

 

If the Agent receives an amount under a Finance Document in a currency which is not in the Relevant Currency, the Agent:

 

(a) may convert the amount received into the Relevant Currency in accordance with its normal procedures; and

 

(b) is only regarded as having received the amount that it has converted into the Relevant Currency.

 

6.17 Anti-money laundering

 

(a) A Finance Party may delay, block or refuse to process any payment or other transaction without incurring any liability if the Finance Party knows or reasonably suspects that the transaction or the application of its proceeds will:

 

(1) breach, or cause a Finance Party to breach, any applicable laws or regulations of any jurisdiction (including any sanctions); or

 

(2) allow the imposition of any penalty on the Finance Party or its Related Bodies Corporate under any such law or regulation,

 

including where the transaction or the application of its proceeds involves any entity or activity the subject of any applicable sanctions of any jurisdiction binding on the Finance Party or its Related Body Corporate, or the direct or indirect proceeds of unlawful activity.

 

(b) As soon as practicable after a Finance Party becomes aware that it will delay, block or refuse to process a transaction under clause 6.17(a), it will notify the Borrower and the Agent and consult in good faith but in each case only to the extent the Finance Party determines it is legally permitted to do so. In making that determination the Finance Party shall act reasonably.

 

(c) The Borrower must promptly advise the Agent if any Obligor enters into any Finance Document in the capacity as agent and promptly supply, or procure the supply of, such information as may be reasonably requested by the Agent (for itself or on behalf of any Finance Party) from time to time in relation to any principal for which an Obligor may be acting.

 

(d) Each Obligor undertakes to exercise its rights and perform its obligations under the Finance Documents in accordance with all applicable laws or regulations relating to anti-money laundering, counter-terrorism financing or sanctions.

 

7 Representations and warranties

 

7.1 Representations and warranties

 

Each Obligor represents and warrants to and for the benefit of each Finance Party that:

 

(a) registration: it is a corporation or a limited liability company, as applicable, registered (or taken to be registered) and validly existing under the Corporations Act or otherwise under the laws of its jurisdiction of incorporation;

 

(b) corporate power: it has the corporate power or a limited liability company power, as applicable, to own its assets and to carry on its business as it is now being conducted;

 

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(c) authority: it has power and authority to enter into and perform its obligations under the Relevant Documents to which it is expressed to be a party;

 

(d) Authorisations and Material Authorisation:

 

(1) all:

 

(A) Authorisations required for, or in connection with the execution, delivery and performance by it, and the validity and the enforceability against it, (and in the case of a Finance Document which is a Security, its intended priority) of each Finance Document to which it is a party and the transactions contemplated by those documents; and

 

(B) Material Authorisations,

 

have:

 

(C) been obtained or effected and are maintained in full force and effect (in accordance with their terms);

 

(D) been validly issued under applicable law;

 

(E) not been cancelled, revoked or suspended and no process has been commenced in respect of the cancellation, revocation or suspension of that Authorisation or Material Authorisation (as the case may be);

 

(F) if required, been renewed on or before their respective expiry (or replaced immediately after expiry); and

 

(G) not been materially and adversely modified or transferred;

 

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

 

(3) it is not aware of any Material Authorisation or other Authorisation that will subsequently be required for the development, operation or financing of the Project and the Project Assets as planned and required in accordance with the Life of Mine Plan that:

 

(A) will not be obtained as and when required in the ordinary course and in a timely manner in accordance with the Life of Mine Plan;

 

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

 

(C) will be granted on terms which necessitate an Obligor expending amounts materially in excess of the amounts set out in the Annual Budget or the Life of Mine Plan as at Financial Close;

 

(e) binding obligations: each Relevant Document to which it is expressed to be a party, when executed and delivered by it, will constitute a legal, valid and binding obligation of it, enforceable against it in accordance with its terms, subject to:

 

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(1) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other laws affecting creditors’ rights generally; and

 

(2) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law);

 

(f) transaction permitted: the execution, delivery and performance by it of the Relevant Documents to which it is expressed to be a party will not breach, or result in a contravention of:

 

(1) any law, regulation or Authorisation;

 

(2) its constitution or other constituent documents; or

 

(3) any Encumbrance or agreement which is binding on it or its assets,

 

in any material respect, and will not result in:

 

(4) the creation or imposition of any Encumbrance on any of its assets other than as permitted under a Finance Document; or

 

(5) the acceleration of the date for payment of any obligation under any agreement which is binding on it;

 

(g) no default: no event has occurred or is continuing that constitutes an Event of Default;

 

(h) financial information: its most recent Financial Reports or accounts which it has provided to the Agent under clause 8.1:

 

(1) give a true and fair view of the financial condition and state of affairs of it and its Subsidiaries as at the date they were prepared; and

 

(2) were prepared in accordance with the Accounting Standards;

 

(i) no Material Adverse Effect: except as disclosed to and accepted in writing by the Agent, nothing has occurred which has had or is reasonably likely to have a Material Adverse Effect;

 

(j) Laws:

 

(1) it has complied in all material respects with all applicable laws (including laws relating to Tax, Environmental Law and Mining Law) applicable to it, its assets and the business carried on by it;

 

(2) the Project and its occupation, use and development of the Project and the Project Area complies in all material respects with all Environmental Law and Mining Law; and

 

(3) the Cypress Coal Mine and its occupation, use and development of the Cypress Project Area complies in all material respects with all Environmental Law and Mining Law;

 

(k) no proceedings pending:

 

(1) no litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency which, if adversely determined, might reasonably be expected to involve a potential liability in excess of [***] has or have, been started or to the best of its knowledge and belief are threatened against it unless:

 

(A) in the case of threatened proceedings, the Agent has been given notice outlining details relating to the proceedings which are known at that time by the relevant Obligor; and

 

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(B) in the case of commenced proceedings:

 

1. the Agent has been given notice outlining details relating to the proceedings; and

 

2. the relevant Obligor is defending or contesting those proceedings;

 

(2) no litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency which, if adversely determined, might reasonably be expected to have a Material Adverse Effect, has or have, been started or to the best of its knowledge and belief are threatened against it;

 

(3) no judgment or order of a court, arbitral tribunal or other tribunal or any order of any government, Government Agency or other regulatory body which involves a potential liability in excess of [***] or is reasonably likely to have a Material Adverse Effect has been made against it;

 

(4) no litigation, arbitration, claim, dispute or administrative proceedings or other investigation or proceeding has been commenced, is pending or threatened and no judgement or award has been given, made or is pending that in any way questions:

 

(A) its power or authority to enter into or perform its obligations under any Finance Document; or

 

(B) the power or authority of an Obligor to enter into and perform its obligations under any Project Document,

 

which:

 

(C) in the case of a claim or dispute, is not frivolous or vexatious; and

 

(D) has or, if adversely determined, is reasonably likely to have a Material Adverse Effect;

 

(l) no immunity: it does not, nor do its assets, enjoy immunity from any suit or execution;

 

(m) representations true: each of its representations and warranties contained in the Finance Documents is correct and not misleading when made or repeated;

 

(n) disclosure: all information provided to any Finance Party by or on its behalf in relation to it, its assets, business or affairs or the Relevant Documents was correct and not misleading (by omission or otherwise) as at the time it was provided;

 

(o) no failure to disclose: it has fully disclosed in writing to each Finance Party all facts relating to it, the Relevant Documents and anything in connection with them which are material to the assessment of the nature and amount of the risk undertaken by the Finance Parties in entering into the Finance Documents;

 

(p) legal and beneficial owner: it is the legal and beneficial owner of its Secured Property;

 

(q) no Encumbrances or other interests:

 

(1) there is no Encumbrance or Quasi-Security over any of its assets other than a Permitted Encumbrance;

 

(2) except as disclosed to and accepted by the Agent in writing prior to the date of this agreement, no caveats, land claims, sacred site applications or claims of any other nature whatsoever have been lodged or made by a person or persons other than an Obligor in respect of the Project, the Project Area or the Cypress Project Area except for Permitted Encumbrances; and

 

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(3) on or after the date of this agreement, no caveats, land claims, listings on the US national register of historic places, conservation easements, sacred site applications or claims of any other nature whatsoever have been lodged or made by a person or persons other than an Obligor in respect of the Project, the Project Area or the Cypress Project Area except:

 

(A) as disclosed to the Agent in writing where such lodgement or application does not have and is not reasonably likely to have a Material Adverse Effect;

 

(B) as disclosed to the Agent in writing and accepted by the Agent where such lodgement or application has or is reasonably likely to have a Material Adverse Effect; or

 

(C) for Permitted Encumbrances;

 

(r) constitutional documents: its constitutional documents do not prohibit or otherwise restrict the granting, or exercise, of the Options or the issue of Shares on the exercise of the Options and the constitutional documents of each entity in which Marketable Securities forming part of the Secured Property are held do not restrict the transfer of those Marketable Securities on enforcement of a Security;

 

(s) not a trustee: it does not enter into any Relevant Document as trustee of any trust or settlement;

 

(t) Insolvency Event: no Insolvency Event has occurred and is continuing in relation to it or will occur as a result of it entering into any Finance Document to which it is a party;

 

(u) Project Documents:

 

(1) the copies of the Project Documents delivered by or on behalf of it to the Agent are accurate and complete in all respects;

 

(2) except as notified to the Agent in writing, each Material Project Document to which it is a party is in full force and effect and no event has occurred or condition exists which would permit the cancellation, termination, forfeiture or suspension of any Material Project Document nor, to the best of the knowledge and belief of the relevant Obligor party, is any party to any Material Project Document in default under any material term in a manner that would entitle the counterparty to terminate or suspend that Material Project Document;

 

(3) as at the date of this agreement, each Project Tenement and Cypress Project Tenement to which it is a party is in full force and effect and no event has occurred or condition exists which would permit the cancellation, termination, forfeiture or suspension of any Project Tenement or Cypress Project Tenement, nor to the best of the knowledge and belief of the relevant Obligor party is any party to any Project Tenement or Cypress Project Tenement in default under any material term;

 

(4) Schedule 10 contains a true, accurate and complete list of all Project Owned Property, Project Tenements, Cypress Project Tenements and Cypress Owned Property as at the date of this agreement; and

 

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(5) it is not in default under any other Project Document, contract or agreement which has, or is reasonably likely to have, a Material Adverse Effect;

 

(v) commercial benefit: the entering into and performance by it of its obligations under the Relevant Documents to which it is expressed to be a party is for its commercial benefit and is in its commercial interests;

 

(w) Tax:

 

(1) it has promptly filed, or caused to be filed, all tax returns, business activity statements and other tax filings which are required to be filed under applicable Tax law, including the Tax Act and GST Act;

 

(2) other than as disclosed to the Agent in writing, no claims are or are likely to be asserted against it with respect to Taxes; and

 

(3) it has paid all Taxes payable by it when due (except for Contested Taxes);

 

(x) insurances: all of the insurances required for the Project have been effected in accordance with the requirements of clause 8.19 and are valid and binding, and all premiums due have been paid and nothing has been done or omitted to be done which has made or could make any such policy void or voidable or reduce the insurer’s liability under them;

 

(y) business: no Project Obligor carries on any business other than:

 

(1) the Project and activities incidental to the Project (including entering into the Relevant Documents and the transactions contemplated by them); and

 

(2) the Cypress Coal Mine;

 

(z) Group Structure:

 

(1) its only Subsidiaries are listed in the Group Structure Diagram; and

 

(2) the Group Structure Diagram is true and correct in all respects and does not omit any material information or details;

 

(aa) Environmental Liabilities:

 

(1) there are no:

 

(A) pending or, to the best of its knowledge and belief, threatened lawsuits, arbitrations or other proceedings relating to material Environmental Liabilities relating to any Obligor, the Project Assets, the Project Area, the Cypress Project Area, the Cypress Coal Mine or the Cypress Project Assets and, to the best of its knowledge and belief, there are no material conditions, occurrences, or Contaminations which could reasonably be expected to form the basis of such a lawsuit, arbitration or other proceeding; or

 

(B) failures to comply with applicable Environmental Laws or Mining Laws which have resulted in material Environmental Liabilities;

 

(2) there are no material Black Lung liabilities affecting any Obligor;

 

(3) all environmental bonding for the Project that is required to be in place at the time is in place and collateralised in the amount represented in the Life of Mine Plan; and

 

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(4) no Obligor nor any of its officers, directors or Subsidiaries, has been barred for a period of [***] or more consecutive days from receiving surface or underground Authorisations pursuant to the permit blockage provisions of the Surface Mining Control and Reclamation Act, 30 U.S.C. §§1201 et seq., and the regulations promulgated thereunder, or any corresponding state laws or regulations; and

 

(bb) Listing Rules: the Parent is complying with:

 

(1) all applicable ASX Rules; and

 

(2) the listing rules of Nasdaq.

 

7.2 Survival and repetition of representations and warranties

 

The representations and warranties given under this agreement are made on the date of this agreement:

 

(a) survive the execution of each Finance Document; and

 

(b) (except for the representation in clause 7.1(o)) are repeated (with each representation and warranty so repeated, a Repeating Representation) on each Funding Date and each Quarterly Date with respect to the facts and circumstances then subsisting.

 

7.3 Reliance by Finance Parties

 

Each Obligor and the Parent acknowledges that each Finance Party has entered into each Finance Document to which it is a party in reliance on the representations and warranties given under this agreement.

 

8 Undertakings

 

8.1 Provision of information and reports

 

Each Obligor must provide in a form acceptable to the Agent the following:

 

(a) Annual Financial Reports: no later than [***] days after the end of each financial year, copies of the annual audited consolidated Financial Report of the Parent and its Subsidiaries for that financial year;

 

(b) Half-year Financial Reports: no later than [***] days after the end of the first half of each financial year, copies of the unaudited consolidated semi-annual Financial Report of the Parent and its Subsidiaries for that half financial year;

 

(c) Monthly management reports: no later than [***] days after the end of each month, copies of the management reports with respect to the development, operating performance and management of the Project, including a comparison of (i) actual expenses for that month; (ii) budgeted expenses for that month as set out in the Annual Budget and (ii) management forecasts for those expenses or for expenses in that month, if applicable;

 

(d) Management accounts: no later than [***] days after the end of each month, copies of the financial statements of the Parent and its Subsidiaries on a consolidated basis for that month (including cumulative management accounts for the financial year to date);

 

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(e) Compliance Certificate: within [***] days after each Calculation Date, a Compliance Certificate;

 

(f) Forecast Documents: an updated version of each Forecast Document when required in accordance with clause 10.3;

 

(g) directors’ certificate: at the Agent’s request, a certificate signed by at least 2 directors of the Borrower stating:

 

(1) whether a Default or Review Event has occurred; and

 

(2) if so, full details of the relevant Default or Review Event and the remedial action being taken or proposed;