Exhibit 10.1

 

EXECUTION VERSION

 

AMENDMENT NO. 3 TO FORBEARANCE AGREEMENT

 

THIS AMENDMENT No. 3 TO FORBEARANCE AGREEMENT (this “Agreement”) is made and
entered into as of September 20, 2016 by and among DAKOTA PLAINS TRANSLOADING,
LLC, a Minnesota limited liability company (“Dakota Transloading”), DAKOTA
PLAINS SAND, LLC, a Minnesota limited liability company (“Dakota Sand”), DAKOTA
PLAINS MARKETING, LLC, a Minnesota limited liability company (“Dakota Marketing”
and, together with Dakota Transloading and Dakota Sand, the “Borrowers”), DAKOTA
PLAINS HOLDINGS, INC., a Nevada corporation (“Holdings”), DPTS MARKETING LLC, a
Minnesota limited liability company (“DPTSM”), DAKOTA PETROLEUM TRANSPORT
SOLUTIONS, LLC, a Minnesota limited liability company (“DPTS”), DPTS SAND, LLC,
a Minnesota limited liability company (“DPTS Sand” and, together with Holdings,
DPTSM and DPTS, the “Guarantors”), the Lenders (the “Lenders”) from time to time
party to the Credit Agreement (defined below) and SUNTRUST BANK, in its capacity
as Administrative Agent for the Lenders (in such capacity, “Administrative
Agent”) and as Issuing Bank. Capitalized terms used herein but not otherwise
defined shall have the meanings ascribed to such terms in the Credit Agreement
(defined below).

 

RECITALS

 

A.          The Borrowers, Holdings, the Lenders and the Administrative Agent
are parties to that certain Revolving Credit and Term Loan Agreement, dated as
of December 5, 2014 (as amended by that certain Amendment No. 1 to Revolving
Credit and Term Loan Agreement dated as of August 6, 2015, as amended by that
certain Amendment No. 2 and Waiver to Revolving Credit and Term Loan Agreement
dated as of December 4, 2015, as amended by that certain Amendment No. 3 to
Revolving Credit and Term Loan Agreement, Amendment No. 1 to Forbearance
Agreement and One Time Waiver of Revolving Loan Borrowing Requirements dated as
of July 5, 2016, as amended by that certain Amendment No. 4 to Revolving Credit
and Term Loan Agreement and One Time Waiver of Revolving Loan Borrowing
Requirements dated as of August 5, 2016, and as further amended, restated,
supplemented, replaced, refinanced or otherwise modified from time to time, the
“Credit Agreement”).

 

B.          The Loan Parties, the Administrative Agent and the Lenders are party
to that certain Forbearance Agreement dated as of May 3, 2016 (as amended by
that certain Amendment No. 3 to Revolving Credit and Term Loan Agreement,
Amendment No. 1 to Forbearance Agreement and One Time Waiver of Revolving Loan
Borrowing Requirements dated as of July 5, 2016, as amended by that certain
Amendment No. 2 to Forbearance Agreement dated as of September 1, 2016, and as
further amended, restated, supplemented, replaced or otherwise modified from
time to time, the “Forbearance Agreement”), pursuant to which the Administrative
Agent and Lenders are presently forbearing from exercising certain rights and
remedies available to them under the Credit Agreement, Loan Documents and
applicable law, which rights and remedies arose exclusively as a result of the
occurrence, existence or continuation of the Anticipated Events of Default (as
defined in the Forbearance Agreement).

 

C.          The Loan Parties have requested that the Administrative Agent and
the Lenders amend the Forbearance Agreement as set forth herein.

 

D.          The Administrative Agent and the Lenders have agreed to do so, but
only pursuant to the terms and conditions set forth herein.

 

 

 

 

AGREEMENT

NOW, THEREFORE, IN CONSIDERATION of the premises contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

 

1.          Estoppel, Acknowledgement and Reaffirmation. Each of the Loan
Parties acknowledges and agrees that, as of September 20, 2016: the aggregate
outstanding principal amount of the Tranche A Term Loan was not less than
$12,925,000; the aggregate outstanding principal amount of the Tranche B Term
Loan was not less than $22,500,000; the aggregate outstanding principal amount
of all Revolving Loan was not less than $21,500,000; and the LC Exposure was $0;
each of which constitutes a valid and subsisting obligation of the Loan Parties
to the Lenders that is not subject to any credits, offsets, defenses, claims,
counterclaims or adjustments of any kind.

2.          Consent, Reaffirmation and Ratification. By its signature below,
each of the undersigned Loan Parties hereby: (a) acknowledges and consents to
this Agreement and the terms and provisions hereof; (b) reaffirms the covenants
and agreements contained in each Loan Document to which it is a party,
including, in each case, as such covenants and agreements may be modified by
this Agreement and the transactions contemplated hereby; (c) reaffirms that each
of the Liens created and granted in, or pursuant to, the Loan Documents in favor
of the Administrative Agent, for the benefit of the holders of the Obligations,
is valid and subsisting and acknowledges and agrees that this Agreement shall in
no manner impair or otherwise adversely affect such Liens, except as explicitly
set forth herein; and (d) confirms that each Loan Document to which it is a
party is and shall continue to be in full force and effect and the same is
hereby ratified and confirmed in all respects, except that upon the
effectiveness of this Agreement, all references in such Loan Documents to the
“Credit Agreement”, “thereunder”, “thereof” or words of like import shall mean
the Credit Agreement and the Loan Documents, as the case may be, as in effect
and modified by this Agreement.

3.         Amendments to Forbearance Agreement. 

            (a)        The penultimate sentence of Section 3 of the Forbearance
Agreement is hereby amended and restated in its entirety as follows:

As used herein, a “Forbearance Termination Event” shall mean the earliest of the
following to occur: (a) any Default or Event of Default under the Credit
Agreement or the other Loan Documents other than the Anticipated Events of
Default; (b) a breach by any Loan Party of any obligation or covenant under this
Agreement; and (c) November 30, 2016 (such date, the “Forbearance Termination
Date”).

 

            (b)          Clause (ii) of Section 7 of the Forbearance Agreement
is hereby amended and restated in its entirety as follows:

(ii) conduct, at such times and on such dates as reasonably requested by the
Administrative Agent, a status update (in the form of a conference call with the
Administrative Agent) regarding the Loan Parties’ business operations, financial
performance, liquidity position, sale process and the status of any material
events or litigation.

 

4.         Agent Financial Advisor/Restructuring Officer. The Administrative
Agent may engage (or direct its counsel to engage) a financial or restructuring
advisor (the “Agent Advisor”) to, among other things, perform a review of the
Loan Parties’ financial performance, financial reporting, financial forecasts,
accounting details, operations and other related matters. In connection
therewith, the Loan Parties shall cooperate with the Agent Advisor and provide
the Agent Advisor with reasonable access to such of the Loan Parties’
facilities, employees, management and financial information as is necessary for
the Agent Advisor perform the services within the scope of its engagement, which
access shall include without limitation all visitation and inspection rights of
the Administrative Agent under Section 5.7 of the Credit Agreement.

 

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5.         Forbearance Period Milestones. The Loan Parties shall satisfy the
following milestones on or before the date specified therefore:

 

(a)           on or before October 30, 2016, the Loan Parties shall have
received one or more executed letters of intent for the purchase of all or
substantially all of the Loan Parties’ equity or assets (such transaction, a
“Potential Transaction”) from potential purchasers with demonstrated ability to
close a Potential Transaction (each such potential purchaser, a “Potential
Purchaser”); and 

(b)          on or before November 20, 2016, the Loan Parties and one or more
Potential Purchasers shall have entered into a definitive asset purchase
agreement for the sale of all or substantially all of the Loan Parties’ equity
or assets. 

6.         Costs and Expenses. The Borrowers shall pay all reasonable and
documented out-of-pocket fees, costs and expenses incurred by the Administrative
Agent and the Lenders (including, without limitation, the reasonable and
documented fees and out-of-pocket costs and expenses of counsel) incurred in
connection with the Credit Agreement, this Agreement and the other Loan
Documents through the Effective Date (defined below).

 

7.         Conditions Precedent. This Agreement shall be effective as of the
date hereof (the “Effective Date”) when, and only when, each of the following
conditions shall have been satisfied or waived, in the sole discretion of the
Administrative Agent: 

 

(a)          The Administrative Agent shall have received counterparts of this
Agreement duly executed by each of the Loan Parties, the Lenders and the
Administrative Agent. 

(b)          The Administrative Agent shall have received such certificates of
resolutions or other action, incumbency certificates and/or other certificates
of Responsible Officers of each Loan Party as the Administrative Agent may
require evidencing the identity, authority and capacity of each Responsible
Officer thereof authorized to act as a Responsible Officer in connection with
this Agreement and the other Loan Documents to which such Loan Party is a
party. 

(c)          Counsel to the Administrative Agent shall have received
reimbursement from the Loan Parties for all reasonable fees, costs and expenses
charged the Administrative Agent and the Lenders in connection with the Credit
Agreement, this Agreement and the other Loan Documents through the Effective
Date. 

8.         Incorporation of Agreement. Except as specifically modified herein,
the terms of the Loan Documents shall remain in full force and effect. The
execution, delivery and effectiveness of this Agreement shall not operate as a
waiver of any right, power or remedy of the Administrative Agent under the Loan
Documents, or constitute a waiver or amendment of any provision of the Loan
Documents, except as expressly set forth herein. The breach in any material
respect of any provision or representation under this Agreement shall constitute
an immediate Event of Default under the Credit Agreement, and this Agreement
shall constitute a Loan Document.

 

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9.         Representations of the Loan Parties. Each of the Loan Parties
represents and warrants to the Administrative Agent and the Lenders as follows:

 

(a)          Except as acknowledged herein, no Default or Event of Default
exists under the Loan Documents on and as of the date hereof. 

(b)          It has taken all necessary action to authorize the execution,
delivery and performance of this Agreement and any other documents delivered by
it in connection herewith.

(c)          This Agreement and each other document delivered by it in
connection herewith has been duly executed and delivered by such Person and
constitutes such Person’s legal, valid and binding obligation, enforceable in
accordance with its terms, except as such enforceability may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors’ rights generally and (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity). 

(d)          No consent, approval, authorization or order of, registration or
qualification with, any court or Governmental Authority or third party is
required in connection with the execution, delivery or performance by such
Person of this Agreement. 

(e)          The execution and delivery of this Agreement or any other document
delivered by it in connection herewith does not (i) violate, contravene or
conflict with any provision of its organizational documents or (ii) materially
violate, contravene or conflict with any laws applicable to it or any of its
Subsidiaries. 

(f)          After giving effect to this Agreement, the representations and
warranties of the Loan Parties contained in the Loan Documents, as supplemented
by the disclosures on Schedule 11(f) to the Forbearance Agreement, are true,
accurate and complete in all materials respects on and as of the date hereof to
the same extent as though made on and as of such date except to the extent such
representations and warranties specifically relate to an earlier date. 

10.       Release; No Action, Claims, Etc.. In consideration of the
Administrative Agent’s, the Lenders’ and the Issuing Bank’s willingness to enter
into this Agreement, each of the Loan Parties hereby releases and forever
discharges the Administrative Agent, the Lenders, the Issuing Bank and each of
the Administrative Agent’s, Lenders’ and Issuing Bank’s respective predecessors,
successors, assigns, officers, managers, directors, employees, agents,
attorneys, representatives, and affiliates (hereinafter all of the above
collectively referred to as the “Lender Group”), from any and all claims,
counterclaims, demands, damages, debts, suits, liabilities, actions and causes
of action of any nature whatsoever, in each case to the extent arising in
connection with the Loan Documents through the date of this Agreement, whether
arising at law or in equity, whether known or unknown, whether liability be
direct or indirect, liquidated or unliquidated, whether absolute or contingent,
foreseen or unforeseen, and whether or not heretofore asserted, which each of
the Loan Parties may have or claim to have against any of the Lender Group. As
of the date hereof, each of the Loan Parties hereby acknowledges and confirms
that it has no knowledge of any actions, causes of action, claims, demands,
damages and liabilities of whatever kind or nature, in law or in equity, against
any member of the Lender Group arising from any action by such Person, or
failure of such Person to act under the Loan Documents on or prior to the date
hereof.

 

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11.       Further Assurances. Each of the parties hereto agrees to execute and
deliver, or to cause to be executed and delivered, all such instruments as may
reasonably be requested to effectuate the intent and purposes, and to carry out
the terms, of this Agreement.

 

12.       No Third Party Beneficiaries. This Agreement and the rights and
benefits hereof shall inure to the benefit of each of the parties hereto and
their respective successors and assigns. No other Person shall have or be
entitled to assert rights or benefits under this Agreement.

 

13.       Governing Law; Jurisdiction; Consent to Service of Process; Waiver of
Jury Trial. The governing law, jurisdiction, consent to service of process and
waiver of jury trial provisions set forth in Sections 10.5 and 10.6 of the
Credit Agreement are hereby incorporated by reference, mutatis mutandis.

 

14.       Entirety. This Agreement and the other Loan Documents embody the
entire agreement between the parties and supersede all prior agreements and
understandings, if any, relating to the subject matter hereof. This Agreement
and the other Loan Documents represent the final agreement between the parties
and may not be contradicted by evidence of prior, contemporaneous or subsequent
oral agreements of the parties.

 

15.       Miscellaneous

 

(a)          This Agreement shall be binding on and shall inure to the benefit
of the Loan Parties, the Administrative Agent, the Lenders and their respective
successors and permitted assigns. It is the intent of the undersigned Lenders
that any third party acquiring any such Lender’s rights and obligations under
the Credit Agreement shall, with respect to such Lender’s portion of the Loan,
be subject to, and bound by, the terms and conditions of this Agreement. The
terms and provisions of this Agreement are for the purpose of defining the
relative rights and obligations of the Loan Parties, the Administrative Agent,
the Issuing Bank and the Lenders with respect to the transactions contemplated
hereby and there shall be no third party beneficiaries of any of the terms and
provisions of this Agreement. 

(b)          Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose. 

(c)          Wherever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement. 

(d)          Except as otherwise expressly provided in this Agreement, if any
provision contained in this Agreement is in conflict with, or inconsistent with,
any provision in the Loan Documents, the provision contained in this Agreement
shall govern and control. 

(e)          This Agreement may be executed in any number of separate
counterparts, each of which shall collectively and separately constitute one
agreement. Delivery of an executed counterpart of this Agreement by telecopy or
other electronic means shall be effective as an original. 

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(f)          This Agreement does not represent a commitment by the Lenders
and/or the Administrative Agent to make any new loans, restructure the
Obligations or grant or extend any financial accommodations to the Loan Parties,
except for the agreements expressly set forth herein. 

 

16.       No Waiver. Nothing herein shall constitute a waiver of the Anticipated
Events of Default, as such term is defined in the Forbearance Agreement.

 

[Signature pages follow.]

 

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered as of the date first above written. 

        BORROWERS: DAKOTA PLAINS TRANSLOADING, LLC             By: /s/ Gabriel
G. Claypool     Name: Gabriel G. Claypool     Title: President, CEO and
Secretary             DAKOTA PLAINS SAND, LLC             By: /s/ Gabriel G.
Claypool     Name: Gabriel G. Claypool     Title: President, CEO and Secretary  
          DAKOTA PLAINS MARKETING, LLC             By: /s/ Gabriel G. Claypool  
  Name: Gabriel G. Claypool     Title: President, CEO and Secretary          
HOLDINGS: DAKOTA PLAINS HOLDINGS, INC.             By: /s/ Gabriel G. Claypool  
  Name: Gabriel G. Claypool     Title: President and COO           SUBSIDIARY
LOAN PARTIES: DPTS MARKETING LLC             By: /s/ Gabriel G. Claypool    
Name: Gabriel G. Claypool     Title: Manager             DAKOTA PETROLEUM
TRANSPORT SOLUTIONS, LLC           By:  /s/ Gabriel G. Claypool     Name:
Gabriel G. Claypool     Title: Manager             DPTS SAND, LLC,            
By: /s/ Gabriel G. Claypool     Name: Gabriel G. Claypool     Title: Manager  

 

SIGNATURE PAGE
DAKOTA PLAINS – AMENDMENT NO. 3 TO FORBEARANCE AGREEMENT

 

 

 

 

ADMINISTRATIVE       AGENT: SUNTRUST BANK,     as Administrative Agent          
  By:  /s/ Janet R. Naifeh     Name: Janet R. Naifeh     Title: Senior Vice
President           LENDERS: SUNTRUST BANK,     as a Lender and Issuing Bank    
        By: /s/ Janet R. Naifeh     Name: Janet R. Naifeh     Title: Senior Vice
President  

 

SIGNATURE PAGE
DAKOTA PLAINS – AMENDMENT NO. 3 TO FORBEARANCE AGREEMENT