FS Energy and Power Fund 8-K [fsep-8k_112515.htm]

 

Exhibit 10.1

 

 

 FIRST AMENDMENT TO TERM LOAN AND SECURITY AGREEMENT

 

This FIRST AMENDMENT TO TERM LOAN AND SECURITY AGREEMENT, is made as of November
25, 2015 (this “Amendment”), among FOXFIELDS FUNDING LLC, a Delaware limited
liability company (“Company”), FORTRESS CREDIT CO LLC, as Administrative Agent
for Lenders (“Administrative Agent”), and the Lenders signatory hereto.

WHEREAS, the Company, Administrative Agent and the Lenders signatory thereto
from time to time are party to that certain Term Loan and Security Agreement,
dated as of November 6, 2015 (as the same may be amended, restated, supplemented
or otherwise modified from time to time, and as amended herein, the “Loan
Agreement;” capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to such terms in the Loan Agreement), pursuant to
which Lenders have extended to the Company certain Term Loans and other
financial accommodations;

WHEREAS, the Company has requested that Administrative Agent and Lenders make
certain amendments to the Loan Agreement, as more fully-described herein; and

WHEREAS, Administrative Agent and Lenders are willing to agree to such
amendments to the Loan Agreement on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the foregoing premises, and other good and
valuable consideration, the receipt and legal sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

1.

Amendments to the Loan Agreement. The Loan Agreement is hereby amended as
follows as of the date hereof:

(a)

The second “WHEREAS” clause of the Recitals to the Loan Agreement is hereby
amended by deleting the reference to the number “$125,000,000” from the first
line thereof and inserting the number “$155,000,000” in lieu thereof.

(b)

Section 1.01 of the Loan Agreement is hereby amended by deleting clause (b)(i)
of the definition of the term “Permitted Dispositions” in its entirety and
inserting the following in lieu thereof: “no Event of Default then exists (or
would be caused thereby), and no violation of Section 7.16(a)(iv) has occurred
that has not been cured in accordance with the terms of Section 7.16(b).”

(c)

Section 1.01 of the Loan Agreement is hereby further amended by deleting clause
(a)(i) of the definition of the term “Permitted Distributions” in its entirety
and inserting the following in lieu thereof: “no Event of Default has occurred
and is continuing or would be caused thereby, and no violation of Section
7.16(a)(iv) has occurred that has not been cured in accordance with the terms of
Section 7.16(b).”

(d)

Section 1.01 of the Loan Agreement is hereby further amended by deleting the
last sentence of the definition of the term “Term Loan Commitment” in its
entirety and inserting the following in lieu thereof: “The aggregate amount of
the Term Loan Commitments as of the First Amendment Effective Date is
$155,000,000.”

 

 

 

(e)

Section 1.01 of the Loan Agreement is hereby further amended by adding the
following defined term thereto (in the correct alphabetical order):

“First Amendment Effective Date” means November 25, 2015.

(f)

Section 2.03 of the Loan Agreement is hereby amended by adding the phrase “, for
the account of Lenders,” immediately following the term “Administrative Agent”
in lines 16 and 19 of clause (b) thereof.

(g)

Section 2.03 of the Loan Agreement is hereby further amended by deleting
subsection (i) of clause (c) in its entirety and inserting the following in lieu
thereof:

(i) the average daily difference between (x) (A) prior to the First Amendment
Effective Date, $125,000,000 and (B) on or after the First Amendment Effective
Date, $155,000,000 and (y) the aggregate principal amount of Term Loans extended
prior to the date of calculation,

(h)

Section 2.08 of the Loan Agreement is hereby amended by deleting the reference
to the number “$75,000,000” from the first line thereof and inserting the number
“$45,000,000” in lieu thereof.

(i)

Section 4.02 of the Loan Agreement is hereby amended by deleting clause (d)
thereof in its entirety and inserting the following in lieu thereof:

(d) No Event of Default shall have occurred and be continuing, or would result
therefrom, and no violation of Section 7.16(a)(iv) shall have occurred that has
not been cured in accordance with the terms of Section 7.16(b).

(j)

Section 5.11 of the Loan Agreement is hereby amended by deleting clause (a)
thereof in its entirety and inserting the following in lieu thereof:

(a) The Company intends to use the proceeds of the Term Loans solely as provided
in the Recitals hereto without violation of the terms hereof and does not intend
to (and will not) use all or any portion of the proceeds of the Term Loans (x)
to purchase any margin stock or (y) for any purpose that would constitute a
violation of Regulation T, U or X of the FRB.

(k)

Section 6.01 of the Loan Agreement is hereby amended by adding the following
parenthetical to the lead-in thereof immediately following the term
“Administrative Agent”:

(and Administrative Agent shall thereafter make available to each Lender,
including, for clarity, by e-mail)

(l)

Section 6.02 of the Loan Agreement is hereby amended by adding the following
parenthetical to the lead-in thereof immediately following the term
“Administrative Agent”:

(and Administrative Agent shall thereafter make available to each Lender,
including, for clarity, by e-mail)

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(m)

Section 7.10 of the Loan Agreement is hereby deleted in its entirety and the
following is inserted in lieu thereof:

7.10     Use of Proceeds. Use the proceeds of Term Loans (x) to purchase margin
stock or (y) for any purpose that (a) constitutes a violation of Regulations T,
U or X promulgated by the FRB or (b) is otherwise prohibited by this Agreement.

 

(n)

Section 11.07 of the Loan Agreement is hereby amended by deleting the first
proviso of clause (a) thereof in its entirety and inserting the following
proviso in lieu thereof:

provided, however, that no Lender shall be liable for the payment to any
Agent-Related Person of any portion of such Indemnified Liabilities to the
extent (x) such Indemnified Liabilities result solely from a cure by the
Administrative Agent, pursuant to Section 10.01, of a default by a Loan Party
under any Portfolio Investment Document but only to the extent the
Administrative Agent has not received prior approval with respect to such cure
by such Lender or (y) determined in a final, nonappealable Judgment by a court
of competent jurisdiction to have resulted from such Agent-Related Person’s own
gross negligence or willful misconduct;

(o)

Section 12.02 of the Loan Agreement is hereby amended by adding the following
new clause (d) immediately following clause (c) thereof:

(d) Distribution of Materials to Lenders. The Loan Parties acknowledge and agree
that the Loan Documents and all reports, notices, communications and other
information or materials provided or delivered by, or on behalf of, the Loan
Parties, including pursuant to Section 6.01 or 6.02, may be disseminated by, or
on behalf of, Administrative Agent, and made available, to the Lenders.

(p)

Appendix A to the Loan Agreement is hereby deleted in its entirety and the
Appendix A attached hereto is inserted in lieu thereof.

(q)

Exhibit E to the Loan Agreement is hereby replaced in its entirety with the
Exhibit E attached hereto as Exhibit A.

2.

Acknowledgment. Administrative Agent’s and Lenders’ agreement to the amendments
and agreements contained herein does not and shall not create (nor shall FSEP,
the Company or any other Loan Party rely upon the existence of or claim or
assert that there exists) any obligation of Administrative Agent or any Lender
to consider or agree to any further amendments or agreements. In the event
Administrative Agent and Lenders subsequently agree to consider any further
amendments or agreements, neither the amendments and agreements contained herein
nor any other conduct of Administrative Agent or any Lender shall be of any
force or effect on Administrative Agent’s or any Lender’s consideration or
decision with respect to any such requested amendment or agreement, and
Administrative Agent and Lenders shall have no further obligation whatsoever to
consider or agree to further amendments or agreements.

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3.

Representations, Warranties, Covenants and Acknowledgments. To induce
Administrative Agent and Lenders to enter into this Amendment:

(a)

The Company does hereby represent and warrant that (i) as of the date hereof,
all of the representations and warranties made or deemed to be made under the
Loan Documents are true and correct in all material respects (provided, that any
representation or warranty that is qualified by materiality or by reference to
Material Adverse Effect shall be true and correct in all respects), except such
representations and warranties which, by their express terms, are applicable
only to the Closing Date, (ii) as of the date hereof, there exists no Default or
Event of Default under the Loan Agreement or any of the other Loan Documents,
(iii) the Company has the power and is duly authorized to enter into, deliver
and perform this Amendment, and (iv) this Amendment and each of the Loan
Documents is the legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.

(b)

The Company does hereby reaffirm each of the agreements, covenants, and
undertakings set forth in the Loan Agreement and each and every other Loan
Document executed in connection therewith or pursuant thereto, as amended and
modified hereby, as if the Company were making said agreements, covenants and
undertakings on the date hereof.

(c)

The Company does hereby acknowledge and agree that no right of offset, defense,
counterclaim, claim, cause of action or objection in favor of the Company
against Administrative Agent or any Lender exists arising out of or with respect
to (i) the Obligations, this Amendment, the Loan Agreement or any of the other
Loan Documents, or (ii) any other documents now or heretofore evidencing,
securing or in any way relating to the foregoing.

(d)

The Company acknowledges and agrees that this Amendment shall be deemed a Loan
Document for all purposes under the Loan Agreement.

(e)

The parties hereto acknowledge and agree that, notwithstanding the requirement
in Section 2.01(b) of the Loan Agreement that a Funding Notice be delivered no
later than 2:00 p.m. at least two (2) Business Days prior to any requested Term
Loan, a Funding Notice with respect to any Term Loan requested on the First
Amendment Effective Date shall be effective if delivered to Administrative Agent
by 2:00 p.m. one (1) Business Day prior to such requested Term Loan (or such
later time as Administrative Agent and ORIX Finance, LP shall agree).

(f)

The parties hereto acknowledge and agree that, notwithstanding any provision of
the Loan Agreement, including the terms of Section 2.01(c) thereof, (i) funding
of the Term Loan requested on the First Amendment Effective Date shall not be
based on each Lender’s Pro Rata Share and (ii) ORIX Finance, LP shall fund the
entire $9,600,000 Term Loan requested on the First Amendment Effective Date.

4.

Indemnification. The Company and each other Loan Party hereby agree to indemnify
and hold Administrative Agent, the Lenders, each Agent-Related Person and each
other Indemnitee in accordance with Section 12.05 of the Loan Agreement. The
foregoing indemnity shall survive the payment in full of the Obligations and the
termination of this Amendment, the Loan Agreement and the other Loan Documents.

 

4

 

5.

Conditions Precedent. The effectiveness of this Amendment is subject to the
following conditions precedent:

(a)

Delivery of Documents. On or before the date hereof, the Company shall have
delivered to Administrative Agent, all in form and substance acceptable to
Administrative Agent in its reasonable discretion, (i) counterparts of this
Amendment executed by each party hereto, together with counterparts of an
Acknowledgment and Consent substantially in the form attached hereto, (ii) a
Term Loan Note, dated the First Amendment Effective Date, in favor of ORIX
Finance, LP reflecting its Term Loan Commitment, to the extent requested by such
Lender, (iii) a Secretary’s Certificate, with all customary attachments (or
certifications that no changes have been made to such Person’s Organizational
Documents since the Closing Date), for each of the Company and FSEP, (iv)
favorable written opinions from outside counsel to the Company and FSEP and (v)
any and all other documents reasonably requested by Administrative Agent.

(b)

Accuracy of Representations and Warranties. All of the representations and
warranties made or deemed to be made in this Amendment and under the Loan
Documents shall be true and correct in all material respects (provided, that any
representation or warranty that is qualified by materiality or by reference to
Material Adverse Effect shall be true and correct in all respects) as of the
date of this Amendment, except such representations and warranties which, by
their terms, are applicable to a prior specific date or period.

(c)

Expenses. The Loan Parties shall have paid on or before the date hereof to
Administrative Agent any and all outstanding fees and other charges owing
pursuant to Section 12.04 of the Loan Agreement, to the extent invoiced at least
one (1) Business Day prior to the date hereof.

6.

Effect; Relationship of Parties. Except as expressly amended hereby, the Loan
Agreement shall be and remain in full force and effect as originally written,
and shall constitute the legal, valid, binding and enforceable obligations of
the Company to Administrative Agent and each Lender. The relationship of
Administrative Agent and Lenders, on the one hand, and the Loan Parties, on the
other hand, has been and shall continue to be, at all times, that of creditor
and debtor and not as joint venturers or partners. Nothing contained in this
Amendment, any instrument, document or agreement delivered in connection
herewith or in the Loan Agreement or any of the other Loan Documents shall be
deemed or construed to create a fiduciary relationship between or among the
parties.

 

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7.

Miscellaneous. This Amendment may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same instrument.
Delivery of an executed counterpart of a signature page to this Amendment by
facsimile or other electronic transmission shall be as effective as delivery of
a manually executed counterpart of this Amendment. Any party delivering an
executed counterpart of this consent via facsimile or electronic mail shall also
deliver a manually executed original to Administrative Agent or its counsel, but
the failure to do so does not and will not affect the validity, enforceability
or binding effect of this Amendment or result in a Default or Event of Default
under any Loan Document. This Amendment shall be binding upon and inure to the
benefit of the successors and permitted assigns of the parties hereto. This
Amendment shall be governed by, and construed in accordance with, the laws of
the State of New York without regard to conflict of laws principles (other than
Sections 5-1401 and 5-1402 of the New York General Obligations Law) thereof.
This Amendment embodies the entire agreement and understanding between the
parties hereto with respect to the subject matter hereof and supersedes all
prior oral or written negotiations, agreements and understandings of the parties
with respect to the subject matter hereof, except the agreements embodied in the
Loan Agreement and the other Loan Documents (as modified herein).

[Remainder of Page Intentionally Blank]

 

 

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IN WITNESS WHEREOF, the Company, Administrative Agent and Lenders have caused
this Amendment to be duly executed as of the date first above written.

  FOXFIELDS FUNDING LLC,   as the Company           By: /s/ Stephen S. Sypherd  
Name: Stephen S. Sypherd   Title: Vice President, Treasurer and Secretary

 

 

 

  FORTRESS CREDIT CO LLC,   as Administas the Company               By: /s/
Constantine M. Dakolias   Name: Constantine M. Dakolias   Title: President      
              FORTRESS CREDIT OPPORTUNITIES III CLO
LP, as a Lender   By: FCO III CLO GP LLC, its general partner               By:
/s/ Constantine M. Dakolias   Name: Constantine M. Dakolias   Title: President  
                  FORTRESS CREDIT OPPORTUNITIES V CLO
LIMITED, as a Lender   By: FCO V CLO CM LLC, its collateral manager            
  By: /s/ Constantine M. Dakolias   Name: Constantine M. Dakolias   Title:
President               FORTRESS CREDIT OPPORTUNITIES VII CLO
LIMITED, as a Lender   By: FCO VII CLO CM LLC, its collateral manager          
    By: /s/ Constantine M. Dakolias   Name: Constantine M. Dakolias   Title:
President                     FORTRESS CREDIT FUNDING V LP, as a Lender    By:
Fortress Credit Funding V GP LLC, its general partner               By: /s/
Constantine M. Dakolias   Name: Constantine M. Dakolias   Title: President      
              DRAWBRIDGE SPECIAL OPPORTUNITIES
FUND LP, as a Lender   By: Drawbridge Special Opportunities GP, LLC, its general
partner               By: /s/ Constantine M. Dakolias   Name: Constantine M.
Dakolias   Title: President

 

 

  ORIX FINANCE, LP, as a Lender   By: ORIX Corporate Capital Inc., its General
Partner               By: /s/ Mark Campbell  

Name:

Mark Campbell   Title: Authorized Representative